Document and Entity Information
Document and Entity Information - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 23, 2020 | Jun. 28, 2019 | |
Document and Entity Information | |||
Entity Registrant Name | Mistras Group, Inc. | ||
Entity Central Index Key | 0001436126 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Shell Company | false | ||
Entity Public Float | $ 255.7 | ||
Entity Common Stock, Shares Outstanding | 29,035 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Document Transition Report | false | ||
Entity Interactive Data Current | Yes |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current Assets | ||
Cash and cash equivalents | $ 15,016 | $ 25,544 |
Accounts receivable, net | 135,997 | 148,324 |
Inventories | 13,413 | 13,053 |
Prepaid expenses and other current assets | 14,729 | 15,870 |
Total current assets | 179,155 | 202,791 |
Property, plant and equipment, net | 98,607 | 93,895 |
Intangible assets, net | 109,537 | 111,395 |
Goodwill | 282,410 | 279,259 |
Deferred income taxes | 1,786 | 1,930 |
Other assets | 48,383 | 4,767 |
Total Assets | 719,878 | 694,037 |
Current Liabilities | ||
Accounts payable | 15,033 | 13,863 |
Accrued expenses and other current liabilities | 81,389 | 73,895 |
Current portion of long-term debt | 6,593 | 6,833 |
Current portion of finance lease obligations | 4,131 | |
Current portion of finance lease obligations | 3,922 | |
Income taxes payable | 2,094 | 1,958 |
Total current liabilities | 109,240 | 100,471 |
Long-term debt, net of current portion | 248,120 | 283,787 |
Obligations under finance leases, net of current portion | 13,043 | |
Obligations under finance leases, net of current portion | 9,075 | |
Deferred income taxes | 21,290 | 23,148 |
Other long-term liabilities | 42,163 | 6,482 |
Total Liabilities | 433,856 | 422,963 |
Commitments and contingencies | ||
Equity | ||
Preferred stock, 10,000,000 shares authorized | 0 | 0 |
Common stock, $0.01 par value, 200,000,000 shares authorized, 28,945,472 and 28,562,608 shares issued | 289 | 285 |
Additional paid-in capital | 229,205 | 226,616 |
Retained earnings | 77,613 | 71,553 |
Accumulated other comprehensive loss | (21,285) | (27,557) |
Total Mistras Group, Inc. stockholders’ equity | 285,822 | 270,897 |
Non-controlling interests | 200 | 177 |
Total Equity | 286,022 | 271,074 |
Total Liabilities and Equity | $ 719,878 | $ 694,037 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 28,945,472 | 28,562,608 |
Consolidated Statements of Inco
Consolidated Statements of Income (Loss) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement [Abstract] | |||
Revenue | $ 748,586 | $ 742,354 | $ 700,970 |
Cost of revenue | 509,489 | 512,024 | 492,238 |
Depreciation | 21,800 | 22,456 | 21,020 |
Gross profit | 217,297 | 207,874 | 187,712 |
Selling, general and administrative expenses | 168,621 | 165,702 | 151,825 |
Bad debt provision for troubled customers, net of recoveries | 3,038 | 650 | 1,200 |
Impairment charges | 0 | 0 | 15,810 |
Pension withdrawal expense | 848 | 5,886 | 0 |
Gain on sale of subsidiary | 0 | (2,384) | 0 |
Research and engineering | 3,045 | 3,310 | 2,272 |
Depreciation and amortization | 16,733 | 11,957 | 10,363 |
Acquisition-related expense, net | 875 | 532 | 482 |
Litigation charges | 0 | 0 | 1,600 |
Income from operations | 24,137 | 22,221 | 4,160 |
Interest expense | 13,698 | 7,950 | 4,386 |
Income (loss) before provision for income taxes | 10,439 | 14,271 | (226) |
Provision for income taxes | 4,359 | 7,426 | 1,942 |
Net income (loss) | 6,080 | 6,845 | (2,168) |
Less: net income attributable to noncontrolling interests, net of taxes | 20 | 9 | 7 |
Net income (loss) attributable to Mistras Group, Inc. | $ 6,060 | $ 6,836 | $ (2,175) |
Earnings (loss) per common share | |||
Basic (in dollars per share) | $ 0.21 | $ 0.24 | $ (0.08) |
Diluted (in dollars per share) | $ 0.21 | $ 0.23 | $ (0.08) |
Weighted average common shares outstanding: | |||
Basic (in shares) | 28,740 | 28,406 | 28,422 |
Diluted (in shares) | 29,046 | 29,427 | 28,422 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 6,080 | $ 6,845 | $ (2,168) |
Other comprehensive income (loss): | |||
Foreign currency translation adjustments | 6,272 | (10,752) | 12,919 |
Comprehensive income (loss) | 12,352 | (3,907) | 10,751 |
Less: net income attributable to noncontrolling interests | 20 | 9 | 7 |
Foreign currency translation adjustments attributable to noncontrolling interests | 3 | (5) | 4 |
Comprehensive income (loss) attributable to Mistras Group, Inc. | $ 12,335 | $ (3,921) | $ 10,748 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands | Total | Total Mistras Group, Inc. Stockholders’ Equity | Common Stock | Treasury Stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss) | Noncontrolling Interest |
Beginning Balance (in shares) at Dec. 31, 2016 | 29,217 | 420 | ||||||
Beginning Balance at Dec. 31, 2016 | $ 270,744 | $ 270,582 | $ 292 | $ (9,000) | $ 217,211 | $ 91,803 | $ (29,724) | $ 162 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) | (2,168) | (2,175) | (2,175) | 7 | ||||
Other comprehensive income, net of tax | 12,923 | 12,919 | 12,919 | 4 | ||||
Share-based payments | 6,588 | 6,588 | 6,588 | |||||
Net settlement on vesting of restricted stock units (in shares) | 187 | |||||||
Net settlement on vesting of restricted stock units | (1,647) | (1,647) | $ 2 | (1,649) | ||||
Retirement of treasury stock (in shares) | 1,146 | 1,146 | ||||||
Retirement of treasury stock | 0 | $ (12) | $ 24,923 | (24,911) | ||||
Purchase of treasury stock (in shares) | (726) | |||||||
Purchase of treasury stock | $ (15,923) | (15,923) | $ (15,923) | |||||
Exercise of stock options (in shares) | 37 | 37 | ||||||
Exercise of stock options | $ 275 | 275 | 275 | |||||
Ending Balance (in shares) at Dec. 31, 2017 | 28,295 | 0 | ||||||
Ending Balance at Dec. 31, 2017 | 270,792 | 270,619 | $ 282 | $ 0 | 222,425 | 64,717 | (16,805) | 173 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) | 6,845 | 6,836 | 6,836 | 9 | ||||
Other comprehensive income, net of tax | (10,757) | (10,752) | (10,752) | (5) | ||||
Share-based payments (in shares) | 243 | |||||||
Share-based payments | 6,109 | 6,109 | $ 3 | 6,106 | ||||
Net settlement on vesting of restricted stock units | $ (2,188) | (2,188) | (2,188) | |||||
Exercise of stock options (in shares) | 25 | 25 | ||||||
Exercise of stock options | $ 273 | 273 | 273 | |||||
Ending Balance (in shares) at Dec. 31, 2018 | 28,563 | 0 | ||||||
Ending Balance at Dec. 31, 2018 | 271,074 | 270,897 | $ 285 | $ 0 | 226,616 | 71,553 | (27,557) | 177 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income (loss) | 6,080 | 6,060 | 6,060 | 20 | ||||
Other comprehensive income, net of tax | 6,275 | 6,272 | 6,272 | 3 | ||||
Share-based payments (in shares) | 30 | |||||||
Share-based payments | 5,759 | 5,759 | $ 4 | 5,759 | ||||
Net settlement on vesting of restricted stock units (in shares) | 349 | |||||||
Net settlement on vesting of restricted stock units | $ (3,198) | (3,198) | (3,202) | |||||
Exercise of stock options (in shares) | 2,093 | 3 | ||||||
Exercise of stock options | $ 32 | 32 | 32 | |||||
Ending Balance (in shares) at Dec. 31, 2019 | 28,945 | 0 | ||||||
Ending Balance at Dec. 31, 2019 | $ 286,022 | $ 285,822 | $ 289 | $ 0 | $ 229,205 | $ 77,613 | $ (21,285) | $ 200 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | |||
Net income (loss) | $ 6,080 | $ 6,845 | $ (2,168) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | |||
Depreciation and amortization | 38,533 | 34,413 | 31,383 |
Deferred income taxes | (3,599) | 1,859 | (4,854) |
Share-based compensation expense | 5,766 | 6,107 | 6,574 |
Impairment charges | 0 | 0 | 15,810 |
Bad debt provision for troubled customers, net of recoveries | 3,038 | 650 | 1,200 |
Foreign currency (gain) loss | (535) | 1,311 | 604 |
Gain on sale of subsidiary | 0 | (2,384) | 0 |
Fair value adjustments to contingent consideration | 511 | (716) | (463) |
Other | 1,804 | 462 | (525) |
Changes in operating assets and liabilities, net of effect of acquisitions | |||
Accounts receivable | 8,298 | (10,349) | 2,490 |
Inventories | (302) | (2,764) | (117) |
Prepaid expenses and other assets | 3,289 | 1,400 | (1,904) |
Accounts payable | 1,138 | 2,948 | 2,574 |
Accrued expenses and other liabilities | (5,042) | 5,663 | 4,188 |
Income taxes payable | 131 | (3,781) | 1,007 |
Net cash provided by operating activities | 59,110 | 41,664 | 55,799 |
Cash flows from investing activities | |||
Purchase of property, plant and equipment | (22,047) | (20,584) | (19,314) |
Purchase of intangible assets | (873) | (541) | (1,255) |
Disposition of business | 0 | 4,239 | 0 |
Acquisition of businesses, net of cash acquired | (4,228) | (139,980) | (83,424) |
Proceeds from sale of equipment | 1,868 | 1,416 | 1,196 |
Net cash used in investing activities | (25,280) | (155,450) | (102,797) |
Cash flows from financing activities | |||
Repayment of finance lease obligations | (4,545) | (5,813) | (6,492) |
Proceeds from borrowings of long-term debt | 983 | 2,358 | 6,653 |
Repayment of long-term debt | (6,857) | (2,746) | (2,101) |
Proceeds from revolver | 32,000 | 175,176 | 124,000 |
Repayments of revolver | (61,700) | (49,991) | (50,600) |
Payments of debt issuance costs | 0 | (826) | (560) |
Payment of contingent consideration for business acquisitions | (852) | (2,277) | (560) |
Purchases of treasury stock | 0 | 0 | (15,923) |
Taxes paid related to net share settlement of share-based awards | (3,198) | (2,185) | (1,647) |
Proceeds from the exercise of stock options | 32 | 273 | 275 |
Net cash provided by (used in) financing activities | (44,137) | 113,969 | 53,045 |
Effect of exchange rate changes on cash and cash equivalents | (221) | (2,180) | 2,340 |
Net change in cash and cash equivalents | (10,528) | (1,997) | 8,387 |
Cash and cash equivalents: | |||
Beginning of period | 25,544 | 27,541 | 19,154 |
End of period | 15,016 | 25,544 | 27,541 |
Supplemental disclosure of cash paid | |||
Interest | 14,158 | 7,751 | 4,264 |
Income taxes | 6,096 | 10,983 | 3,063 |
Noncash investing and financing | |||
Equipment acquired through finance lease obligations | $ 9,502 | $ 4,845 | $ 3,185 |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Practices | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies and Practices | Summary of Significant Accounting Policies and Practices Description of Business Mistras Group, Inc. and subsidiaries (the Company) is a leading “one source” global provider of technology-enabled asset protection solutions used to evaluate the structural integrity and reliability of critical energy, industrial, public infrastructure and commercial aerospace components. The Company combines industry-leading products and technologies, expertise in mechanical integrity (MI), non-destructive testing (NDT) and mechanical services and proprietary data analysis software to deliver a comprehensive portfolio of customized solutions, ranging from routine inspections to complex, plant-wide asset integrity assessments and management. These mission critical solutions enhance customers’ ability to extend the useful life of their assets, increase productivity, minimize repair costs, comply with governmental safety and environmental regulations, manage risk and avoid catastrophic disasters. The Company serves a global customer base of companies with asset-intensive infrastructure, including companies in the oil and gas, commercial aerospace and defense, fossil and nuclear power, alternative and renewable energy, public infrastructure, chemicals, transportation, primary metals and metalworking, pharmaceutical/biotechnology and food processing industries, and research and engineering institutions. Principles of Consolidation The accompanying audited consolidated financial statements include the accounts of Mistras Group, Inc. and its wholly and majority-owned subsidiaries. For subsidiaries in which the Company’s ownership interest is less than 100%, the non-controlling interests are reported in stockholders’ equity in the accompanying consolidated balance sheets. The non-controlling interests in net income, net of tax, is classified separately in the accompanying consolidated statements of income (loss). All significant intercompany accounts and transactions have been eliminated in consolidation. Reclassifications Certain amounts in prior periods have been reclassified to conform to the current year presentation. Such reclassifications did not have a material effect on the Company's financial condition or results of operations as previously reported. Use of Estimates The preparation of financial statements in accordance with U.S. generally accepted accounting principles (GAAP) requires that the Company make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities at the date of financial statements. The Company bases its estimates and assumptions on historical experience, known or expected trends and various other assumptions that it believes to be reasonable. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates, which may cause the Company’s future results to be significantly affected. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Accounts Receivable Accounts receivable are stated net of an allowance for doubtful accounts and sales allowances. Outstanding accounts receivable balances are reviewed periodically, and allowances are provided at such time that management believes it is probable that such balances will not be collected within a reasonable period of time, to the extent reasonably estimable. The Company extends credit to its customers based upon credit evaluations in the normal course of business, primarily with 30-day terms. Bad debts are provided for based on historical experience and management’s evaluation of outstanding accounts receivable. Accounts are written off when they are deemed uncollectible under GAAP accounting standards. Concentration of Credit Risk For each of the years ended December 31, 2019 and 2018, no customer represented 10% or more of the Company's revenue. One customer represented 11% of the Company's revenue for the year ended December 31, 2017, which was primarily generated from the Services segment. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. At times, cash deposits may exceed the limits insured by the Federal Deposit Insurance Corporation. The Company believes it is not exposed to any significant credit risk or risk of nonperformance of financial institutions. Inventories Inventories are stated at the lower of cost or net realizable value, as determined by using the first-in, first-out method, or market. Work in process and finished goods inventory include material, direct labor, variable costs and overhead. Purchased and Internal-Use Software The Company capitalizes certain costs that are incurred to purchase or to create and implement internal-use software, which includes software coding, installation and testing. Capitalized costs are amortized on a straight-line basis over three years, the estimated useful life of the software. Property, Plant and Equipment Property, plant and equipment are recorded at cost. Depreciation of property, plant and equipment is computed utilizing the straight-line method over the estimated useful lives of the assets. Amortization of leasehold improvements is computed utilizing the straight-line method over the shorter of the remaining lease term or estimated useful life. Repairs and maintenance costs are expensed as incurred. Goodwill Goodwill represents the excess purchase price of acquired businesses over the fair values attributed to underlying net tangible assets and identifiable intangible assets. The Company tests goodwill for impairment at a “reporting unit” level (which for the Company is represented by (i) our Services segment, (ii) our Products and Systems segment, and (iii) the European component of our International segment and (iv) the Brazilian component of our International segment). Our annual impairment test is conducted on the first day of our fourth quarter, which is October 1. Goodwill is also tested for impairment whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. If the fair value of a reporting unit is less than its carrying value, this is an indicator that the goodwill assigned to that reporting unit may be impaired. As a result of the Company adopting Accounting Standards Update ("ASU") No. 2017-04, Intangibles-Goodwill and Other (Topic 350) , impairment will be recorded in the amount that fair value is less than carrying value, as the ASU eliminated step two of the goodwill impairment process. The Company considers the income and market approaches to estimating the fair value of our reporting units, which requires significant judgment in evaluation of economic and industry trends, estimated future cash flows, discount rates and other factors. Impairment of Long-lived Assets The Company reviews the recoverability of its long-lived assets (or asset groups) whenever events or changes in circumstances indicate that the carrying amount of the long-lived asset (group) might not be recoverable. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future undiscounted cash flows. If the total expected future undiscounted cash flows are less than the carrying amount of the assets, a loss is recognized for the difference between fair value (computed based upon the expected future discounted cash flows) and the carrying value of the assets. Acquisitions The Company allocates the purchase price of acquired businesses to their identifiable tangible assets and liabilities as well as identifiable intangible assets, such as customer relationships, technology, non-compete agreements and trade names. Certain estimates and judgments are required in the application of the fair value techniques, including estimates of the respective acquisition's future performance and related cash flows, selection of a discount rate and economic lives, and use of Level 3 measurements as defined in ASC No. 820, Fair Value Measurements and Disclosure. Deferred taxes are recorded for any differences between the assigned values and tax bases of assets and liabilities. Research and Engineering Research and product development costs are expensed as incurred. Advertising, Promotions and Marketing The costs for advertising, promotion and marketing programs are expensed as incurred and are included in selling, general and administrative expenses. Advertising expense was approximately $2.1 million, $2.1 million and $1.9 million for the years ended December 31, 2019, 2018 and 2017, respectively. Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and other financial current assets and liabilities approximate fair value based on the short-term nature of the items. Foreign Currency Translation The financial position and results of operations of the Company’s foreign subsidiaries are measured using their functional currencies, which are their local currencies. Assets and liabilities of foreign subsidiaries are translated into the U.S. Dollar at the exchange rates in effect at the balance sheet date. Income and expenses are translated at the average exchange rate during the period. Translation gains and losses are reported as a component of other comprehensive (loss) income for the period and included in accumulated other comprehensive (loss) income within stockholders’ equity. Foreign currency (gains) and losses arising from transactions denominated in currencies other than the functional currency are included in net income, reported in selling, general and administrative expenses, and were approximately $(0.5) million, $1.3 million, and $0.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. Self-Insurance The Company is self-insured for certain losses relating to workers’ compensation and health benefit claims. The Company maintains third-party excess insurance coverage for all workers' compensation and health benefit claims in excess of approximately $0.3 million per occurrence to reduce its exposure from such claims. Self-insured losses are accrued when it is probable that an uninsured claim has been incurred but not reported and the amount of the loss can be reasonably estimated at the balance sheet date. Share-based Compensation The value of services received from employees and directors in exchange for an award of an equity instrument is measured based on the grant-date fair value of the award. Such value is recognized as a non-cash expense on a straight-line basis over the period the individual provides services, which is typically the vesting period of the award with the exception of awards with graded vesting that contain an internal performance measure where each tranche is recognized on a straight-line basis over its vesting period subject to the probability of meeting the performance requirements and adjusted for the number of shares expected to be earned. As share-based compensation expense is based on awards ultimately expected to vest, the amount of expense is reduced for estimated forfeitures. The cost of these awards is recorded in selling, general and administrative expense in the Company’s consolidated statements of income. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided if it is more likely than not that some or all of a deferred income tax asset will not be realized. Financial accounting standards prescribe a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. These standards also provide guidance on de-recognition, measurement, and classification of amounts relating to uncertain tax positions, accounting for and disclosure of interest and penalties, accounting in interim periods and disclosures required. Interest and penalties related to unrecognized tax positions are recognized as incurred within “provision for income taxes” in the consolidated statements of income. Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-02, Leases (Topic 842) , which the Company adopted as of January 1, 2019. Topic 842 requires the recognition of lease rights and obligations as assets and liabilities on the balance sheet. The Company elected the modified retrospective method permitted by the standard, upon which prior-period information has not been restated. The standard provided for several practical expedient options for use in transition. The Company elected to utilize the “package of practical expedients,” which permits the Company not to reassess previous conclusions reached on lease identification, lease classification and initial direct costs. The Company also elected to utilize the practical expedient available to not separate lease and non-lease components within the lease and has therefore accounted for all lease components as a single lease component. Adoption of the new standard resulted in the recording of a right-of-use (ROU) asset and liability related to the Company’s operating leases of approximately $38 million as of January 1, 2019. The new standard did not have a material impact to our statements of income or cash flows. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350). This amendment eliminates Step Two of the goodwill impairment test. Under the amendments in this update, entities should perform the annual goodwill impairment test by comparing the carrying value of their reporting units to their fair value. An entity should record an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. Tax deductibility of goodwill should be considered in evaluating any reporting unit's impairment loss to be taken. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company early adopted ASU 2017-04 in the third quarter of 2017 for its consolidated financial statements and related disclosures. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities related to outside basis differences. The standard is effective for interim and annual periods beginning January 1, 2021, with certain amendments applied prospectively and others requiring retrospective application. Early adoption is permitted, with any adjustments reflected as of the beginning of the fiscal year of adoption. If early adoption is elected, all changes as a result of the standard must be adopted in the same period. The Company is currently evaluating the impact of this guidance on its consolidated financial position, results of operations, and cash flows. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue The majority of the Company's revenues are derived from providing services on a time and material basis and are short-term in nature. Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts and is, therefore, not distinct. The Company provides highly integrated and bundled inspection services to its customers. Some of our contracts have multiple performance obligations, most commonly due to the contract providing both goods and services. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. The primary method used to estimate standalone selling price is a relative selling price based on price lists. Contract modifications are not routine in the performance of our contracts. Generally, when contracts are modified, the modification is to account for changes in scope to the goods and services that are provided. In most instances, contract modifications are for goods or services that are distinct, and, therefore, are accounted for as a separate contract. Our performance obligations are satisfied over time as work progresses or at a point in time. The majority of our revenue recognized over time as work progresses is related to our service deliverables, which includes providing testing, inspection and mechanical services to our customers. Revenue is recognized over time based on time and material incurred to date which best portrays the transfer of control to the customer. The Company also utilizes an available practical expedient that provides for revenue to be recognized in an amount that corresponds directly with the value to the customer of the entity’s performance completed to date. Fixed fee arrangements are determined based on expected labor, material, and overhead to be consumed on fulfillment of such services. Revenue is recognized on a cost-to-cost method tracked on an input basis. The majority of our revenue recognized at a point in time is related to product sales when the customer obtains control of the asset, which is generally upon shipment to the customer. Contract costs include labor, material and overhead. The Company expects any significant remaining performance obligations to be satisfied within one Contract Estimates The majority of our revenues are short-term in nature. The Company has many Master Service Agreements (MSAs) that specify an overall framework and terms of contract when the Company and customers agree upon services or products to be provided. The actual contracting to provide services or furnish products are triggered by a work order, purchase order, or some similar document issued pursuant to a MSA which sets forth the scope of services and/or identifies the products to be provided. From time-to-time, the Company may enter into long-term contracts, which can range from several months to several years. Revenue on such long-term contracts is recognized as work is performed based on total costs incurred to date in relation to the total estimated costs for the performance of the contract at completion. This includes contract estimates of costs to be incurred for the performance of the contract. Cost estimation is based upon the professional knowledge and experience of our project managers, engineers and financial professionals. Factors that are considered in estimating the work to be completed include the availability of materials, the effect of any delays in our project performance and the recoverability of any claims. Whenever revisions of estimates, contract costs and/or contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period. Revenue by category The following series of tables present our disaggregated revenues: Revenue by industry was as follows: Year ended December 31, 2019 Services International Products & Systems Corp/Elim Total Oil & Gas $ 390,815 $ 44,447 $ 756 $ — $ 436,018 Aerospace & Defense 51,390 41,224 1,237 — 93,851 Industrials 64,622 21,405 3,187 — 89,214 Power generation & Transmission 30,300 10,289 2,726 — 43,315 Other Process Industries 28,495 10,196 418 — 39,109 Infrastructure, Research & Engineering 14,269 9,520 9,316 — 33,105 Other 15,239 7,190 943 (9,398) 13,974 Total $ 595,130 $ 144,271 $ 18,583 $ (9,398) $ 748,586 Year ended December 31, 2018 Services International Products & Systems Corp/Elim Total Oil & Gas $ 378,904 $ 37,953 $ 1,255 $ — $ 418,112 Aerospace & Defense 50,500 54,853 2,355 — 107,708 Industrials 60,594 26,209 3,097 — 89,900 Power generation & Transmission 30,687 8,522 4,904 — 44,113 Other Process Industries 26,425 9,497 124 — 36,046 Infrastructure, Research & Engineering 11,283 9,032 5,246 — 25,561 Other 16,226 7,382 6,445 (9,139) 20,914 Total $ 574,619 $ 153,448 $ 23,426 $ (9,139) $ 742,354 Revenue per key geographic location was as follows: Year ended December 31, 2019 Services International Products & Systems Corp/Elim Total United States $ 487,408 $ 631 $ 12,011 $ (4,918) $ 495,132 Other Americas 104,081 7,659 407 (407) 111,740 Europe 2,342 127,581 1,940 (3,978) 127,885 Asia-Pacific 1,299 8,400 4,225 (95) 13,829 Total $ 595,130 $ 144,271 $ 18,583 $ (9,398) $ 748,586 Year ended December 31, 2018 Services International Products & Systems Corp/Elim Total United States $ 478,853 $ 568 $ 11,493 $ (3,500) $ 487,414 Other Americas 90,823 7,995 1,068 (1,638) 98,248 Europe 4,252 138,948 3,958 (3,846) 143,312 Asia-Pacific 691 5,937 6,907 (155) 13,380 Total $ 574,619 $ 153,448 $ 23,426 $ (9,139) $ 742,354 Contract Balances The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and customer advances and deposits (contract liabilities) on the consolidated balance sheet. Amounts are generally billed as work progresses in accordance with agreed-upon contractual terms, generally at periodic intervals (e.g., weekly, bi-weekly or monthly). Generally, billing occurs subsequent to revenue recognition, resulting in contract assets. However, the Company sometimes receives advances or deposits from our customers before revenue is recognized, resulting in contract liabilities. These assets and liabilities are aggregated on an individual contract basis and reported on the consolidated balance sheet at the end of each reporting period within accounts receivables or accrued expenses and other current liabilities. |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted average number of shares outstanding during the period. Diluted earnings per share is computed by dividing net income attributable to common stockholders by the sum of (1) the weighted average number of shares of common stock outstanding during the period, and (2) the dilutive effect of assumed conversion of equity awards using the treasury stock method. With respect to the number of weighted average shares outstanding (denominator), diluted shares reflect: (i) only the exercise of options to acquire common stock to the extent that the options’ exercise prices are less than the average market price of common shares during the period and (ii) the pro forma vesting of restricted stock units. The following table sets forth the computations of basic and diluted earnings per share: For the year ended December 31, 2019 2018 2017 Basic earnings (loss) per share: Numerator: Net income (loss) attributable to Mistras Group, Inc. $ 6,060 $ 6,836 $ (2,175) Denominator Weighted average common shares outstanding 28,740 28,406 28,422 Basic earnings (loss) per share $ 0.21 $ 0.24 $ (0.08) Diluted earnings (loss) per share: Numerator: Net income (loss) attributable to Mistras Group, Inc. $ 6,060 $ 6,836 $ (2,175) Denominator Weighted average common shares outstanding 28,740 28,406 28,422 Dilutive effect of stock options outstanding 98 683 — Dilutive effect of restricted stock units outstanding 208 338 — 29,046 29,427 28,422 Diluted earnings (loss) per share $ 0.21 $ 0.23 $ (0.08) The following potential common shares were excluded from the computation of diluted earnings per share, as the effect would have been anti-dilutive: For the year ended December 31, 2019 2018 2017 Potential common stock attributable to restricted stock units (RSUs) and performance stock units (PSUs) outstanding (1) 42 1 353 Potential common stock attributable to stock options outstanding (1) 5 5 810 Total 47 6 1,163 (1) For the twelve months ended December 31, 2017, 805 and 351 shares related to stock options and RSUs/PSUs, respectively, were excluded from the calculation of diluted EPS due to the net loss for the period. |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts Receivable Accounts receivable consist of the following: December 31, 2019 2018 Trade accounts receivable $ 144,282 $ 152,511 Allowance for doubtful accounts (8,285) (4,187) Accounts receivable, net $ 135,997 $ 148,324 The Company had $22.2 million and $16.1 million of unbilled revenues accrued as of December 31, 2019 and December 31, 2018, respectively, which is included within the trade accounts receivable balance above. Unbilled revenues as of December 31, 2019 are expected to be billed in the first quarter of 2020. In the fourth quarter of 2018, the Company recorded a reserve of $0.7 million for a renewable energy industry customer, based in part on the available information about the financial difficulties of the customer. This customer filed for a voluntary insolvency proceeding on April 9, 2019 at which time payments under the previously agreed upon payment plan ceased. As a result, during the first quarter of 2019, the Company recorded an additional charge of $5.7 million to fully reserve for the amount of the exposure related to this customer. During the second quarter of 2019, the Company reversed $1.0 million of this reserve based on additional information obtained during the quarter. There were no changes during the third and fourth quarters of 2019. During 2019, the Company sold to an unaffiliated third party, without recourse, its remaining outstanding receivables owed from a customer which filed for bankruptcy, and for which the Company had initially recorded a charge during the second quarter of 2017. During the first quarter of 2019, the Company recorded a recovery of $0.2 million and during the second quarter of 2019, the Company recorded a recovery $1.7 million, related to a bad debt provision for the receivables due from this customer. This matter is considered fully resolved. The Company was contracted to perform inspections of welds on various pipeline projects in Texas for a customer. As of December 31, 2019, approximately $1.4 million of past due receivables were outstanding from this customer. The Company received notice from the customer in December 2019, alleging that the work performed was not in compliance with the contract. The Company filed a lawsuit to recover the $1.4 million and other amounts due to the Company and the customer filed a counterclaim, alleging breach of contract and seeking its damages. Accordingly, the Company recorded a full reserve in the amount of $1.4 million during 2019 for these past due receivables. See Note 18– Commitments and Contingencies for additional details. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following: December 31, 2019 2018 Raw materials $ 5,314 $ 6,975 Work in progress 1,549 1,019 Finished goods 3,957 2,640 Consumable supplies 2,593 2,419 Inventories $ 13,413 $ 13,053 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consist of the following: December 31, Useful Life 2019 2018 (Years) Land $ 2,672 $ 2,680 Building and improvements 30-40 24,537 24,338 Office furniture and equipment 5-8 17,227 16,170 Machinery and equipment 5-7 225,974 208,245 270,410 251,433 Accumulated depreciation and amortization (171,803) (157,538) Property, plant and equipment, net $ 98,607 $ 93,895 Depreciation expense was approximately $24.2 million, $24.2 million, and $22.4 million for the years ended December 31, 2019, 2018 and 2017, respectively. |
Acquisitions and Disposition
Acquisitions and Disposition | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisitions and Disposition | Acquisitions and Disposition Acquisitions During the year ended December 31, 2019, the Company completed one acquisition that provides pipeline integrity management software and services to energy transportation companies. The Company acquired all the equity interest of the acquiree in exchange for aggregate consideration of $4.4 million in cash, contingent consideration of up to $4.3 million to be earned based upon the acquired business achieving specific performance metrics over the initial three years of operations from the acquisition date and working capital adjustments. The goodwill recorded is primarily attributable to expected synergies and is generally fully deductible for tax purposes. The Company is still in the process of completing its valuation of the assets acquired and liabilities assumed. The following table summarizes the estimated fair value of the assets acquired and liabilities assumed, the Company's allocation of purchase price and any subsequent adjustments made during the year ended December 31, 2019 for the 2019 acquisition: 2019 Cash paid $ 4,380 Working capital adjustments (152) Fair value of contingent consideration 1,142 Total consideration $ 5,370 Current net assets $ 142 Other assets 34 Property, plant and equipment 65 Intangibles 3,594 Goodwill 1,535 Net assets acquired $ 5,370 The results of operations of the business acquired in September 2019 have been included in the Services segment within the Consolidated Statements of Income (Loss) from the transaction closing date and approximates $2.0 million of revenues and an operating loss of $0.4 million for the year ended December 31, 2019. During the year ended December 31, 2018, the Company completed one acquisition that performs inline inspection services, with headquarters in Canada and a location in the U.S. The acquired company has been included in the Services segment and primarily provides services to the midstream area within the oil and gas industry. The Company acquired 100% of the equity interests of the acquiree's Canadian and U.S. entities in exchange for aggregate consideration of $143.1 million in cash. The goodwill recorded is primarily attributable to expected synergies and the assembled workforce and is not deductible for tax purposes. The Company has filed a claim with the seller and the Company's insurance carrier. See Note 18– Commitments and Contingencies to these consolidated financial statements for further discussion. During 2019, the Company finalized valuations for of the assets acquired and liabilities assumed related to the 2018 acquisition and adjusted provisional amounts as follows: • The Company increased the $59.6 million provisional fair value of intangibles by $4.8 million with a corresponding decrease to goodwill. • The Company decreased the $8.5 million provisional fair value of property, plant and equipment by $0.7 million with a corresponding increase to goodwill. • The Company increased the $5.0 million provisional fair value of debt and other liabilities by $0.4 million with a corresponding increase to goodwill. • The Company increased the $12.7 million provisional fair value of the deferred tax liability by $1.4 million with a corresponding increase to goodwill. The Company accounted for the acquisitions completed in 2019 and 2018 in accordance with the acquisition method of accounting for business combinations. Assets and liabilities of the acquired businesses were included in the consolidated balance sheet based on their respective estimated fair value on the date of acquisition as determined in a purchase price allocation, using available information and making assumptions management believes are reasonable. The amortization period for the intangible assets acquired range from one Disposition During the third quarter of 2018, substantially all of the assets and liabilities of a subsidiary in the Products and Systems segment were sold for approximately $4.3 million. For the year ended December 31, 2018, the Company recognized a gain of approximately $2.4 million related to the sale, which is reported as a Gain on sale of subsidiary on the Consolidated Statements of Income (Loss). The sale also included a three Commitments and Contingencies ). Acquisition-Related expense In the course of its acquisition activities, the Company incurs costs in connection with due diligence, professional fees, and other expenses. Additionally, the Company adjusts the fair value of acquisition-related contingent consideration liabilities on a quarterly basis. These amounts are recorded as acquisition-related expense, net, on the consolidated statements of income and were as follows for the years ended December 31, 2019, 2018 and 2017: For the year ended December 31, 2019 2018 2017 Due diligence, professional fees and other transaction costs $ 364 $ 1,248 $ 945 Adjustments to fair value of contingent consideration liabilities 511 (716) (463) Acquisition-related expense, net $ 875 $ 532 $ 482 The Company’s contingent consideration liabilities are recorded on the Consolidated Balance Sheets in Accrued expenses and other current liabilities and Other long-term liabilities. |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The changes in the carrying amount of goodwill by segment is shown below: Services International Products and Systems Total Balance at December 31, 2017 $ 165,801 $ 37,637 $ — $ 203,438 Goodwill acquired during the year 83,163 — — 83,163 Adjustments to preliminary purchase price allocations (1,977) — — (1,977) Foreign currency translation (3,511) (1,854) — (5,365) Balance at December 31, 2018 $ 243,476 $ 35,783 $ — $ 279,259 Goodwill acquired during the year 1,535 — — 1,535 Adjustments to preliminary purchase price allocations (2,332) — — (2,332) Foreign currency translation 4,536 (588) — 3,948 Balance at December 31, 2019 $ 247,215 $ 35,195 $ — $ 282,410 The Company conducted its annual goodwill impairment test of its reporting units as of October 1, 2019 and concluded that there was no impairment. As of December 31, 2019, the Company did not identify any changes in circumstances that would indicate the remaining carrying value of goodwill may not be recoverable. |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets The gross carrying amount and accumulated amortization of intangible assets were as follows: December 31, 2019 2018 Useful Life (Years) Gross Accumulated Net Gross Accumulated Net Customer relationships 5-18 $ 113,861 $ (67,853) $ 46,008 $ 112,624 $ (60,993) $ 51,631 Software/Technology 3-15 77,914 (18,756) 59,158 67,240 (13,319) 53,921 Covenants not to compete 2-5 12,795 (11,630) 1,165 12,593 (10,825) 1,768 Other 2-12 10,813 (7,607) 3,206 10,317 (6,242) 4,075 Total $ 215,383 $ (105,846) $ 109,537 $ 202,774 $ (91,379) $ 111,395 Amortization expense for the years ended December 31, 2019, 2018 and 2017, was approximately $14.3 million, $10.2 million, and $9.0 million, respectively, including amortization of software/technology for these periods of $5.6 million, $1.4 million, and $1.2 million, respectively. Amortization expense in each of the five years and thereafter subsequent to December 31, 2019 related to the Company’s intangible assets is expected to be as follows: Expected Amortization Expense 2020 $ 13,864 2021 12,474 2022 12,042 2023 10,987 2024 9,870 Thereafter 50,300 Total $ 109,537 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: December 31, 2019 2018 Accrued salaries, wages and related employee benefits $ 30,072 $ 29,959 Contingent consideration 2,614 1,687 Accrued workers' compensation and health benefits 4,467 5,086 Deferred revenues 5,860 5,046 Right-of-use liability - Operating 10,133 — Pension accrual 2,519 5,585 Other accrued expenses 25,724 26,532 Total accrued expenses and other current liabilities $ 81,389 $ 73,895 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consists of the following: December 31, 2019 2018 Senior credit facility $ 151,773 $ 181,656 Senior secured term loan, net of debt issuance costs of $0.1 million 94,919 99,897 Notes payable — 68 Other 8,021 8,999 Total debt 254,713 290,620 Less: Current portion (6,593) (6,833) Long-term debt, net of current portion $ 248,120 $ 283,787 Senior Credit Facility The Company's revolving credit agreement with its banking group (“Credit Agreement”) provides the Company with a $300 million revolving line of credit, which, under certain circumstances, can be increased to $450 million with the approval of the banks. In addition, the Credit Agreement provides the Company with a $100 million senior secured term loan A facility. Both the revolving line of credit and the term loan A facility under the Credit Agreement have a maturity date of December 12, 2023. The Company may borrow up to $100 million in non-U.S. Dollar currencies and use up to $20 million of the credit limit for the issuance of letters of credit. At December 31, 2019, the Company had borrowings of $246.7 million and letters of credit of $3.7 million were outstanding under the Credit Agreement. The Company had remaining capitalized costs of $0.8 million associated with debt modifications as of December 31, 2019, included in Other assets within the accompanying Consolidated Balance Sheets. Loans under the Credit Agreement bear interest at the London Interbank Offered Rate ("LIBOR") plus an applicable LIBOR margin ranging from 1% to 2%, or a base rate less a margin of 1.25% to 0.375%, at the option of the Company, based upon the Company’s Funded Debt Leverage Ratio. Funded Debt Leverage Ratio is generally the ratio of (1) all outstanding indebtedness for borrowed money and other interest-bearing indebtedness as of the date of determination to (2) EBITDA (which is (a) net income, less (b) income (or plus loss) from discontinued operations and extraordinary items, plus (c) income tax expenses, plus (d) interest expense, plus (e) depreciation, depletion, and amortization (including non-cash loss on retirement of assets), plus (f) stock compensation expense, less (g) cash expense related to stock compensation, plus (h) certain amounts of EBITDA of acquired business for the prior twelve months, plus (i) certain expenses related to the closing of the Credit Agreement, plus (j) non-cash expenses which do not (in the current or any future period) represent a cash item (excluding non-cash gains which increase net income), plus (k) non-recurring charges (not to exceed $10 million in the four consecutive quarters immediately preceding the date of determination) for items such as severance, lease termination charges, asset write-offs and litigation settlements paid, and multi-employer pension plan withdrawal liabilities, all determined for the period of four consecutive fiscal quarters immediately preceding the date of determination of EBITDA. The Company has the benefit of the lowest margin if its Funded Debt Leverage Ratio is equal to or less than 1.0 to 1, and the margin increases as the ratio increases, to the maximum margin if the ratio is greater than 3.25 to 1. The Company will also bear additional costs for market disruption, regulatory changes affecting the lenders’ funding costs, and default pricing of an additional 2% interest rate margin on any amounts not paid when due. Amounts borrowed under the Credit Agreement are secured by liens on substantially all of the assets of the Company and is guaranteed by some of our subsidiaries. The Credit Agreement contains financial covenants requiring that the Company maintain a Funded Debt Leverage Ratio of no greater than 4.25 to 1 through December 31, 2018, reducing to a maximum permitted ratio of 3.50 to 1 as of March 31, 2020 and all quarterly periods thereafter, and a Fixed Charge Coverage Ratio of at least 1.25 to 1. Fixed Charge Coverage Ratio means the ratio, as of any date of determination, of (a) (i) EBITDA for the 12 month period immediately preceding the date of determination, taken together as one accounting period, less (ii) the aggregate amount of all capital expenditures made during the period, less (iii) taxes paid in cash during the period, less (iv) Restricted Payments (as defined in the Credit Agreement) paid in cash during the period, -to- (b) the sum of (i) all interest, premium payments, debt discount, fees, charges and related expenses of us and our subsidiaries in connection with borrowed money (including capitalized interest) or in connection with the deferred purchase price of assets, in each case, to the extent treated as interest in accordance with GAAP and to the extent paid in cash during the period, (ii) the aggregate principal amount of all redemptions or similar acquisitions for value of outstanding debt for borrowed money or regularly scheduled principal payments made during the period, but excluding any such payments to the extent refinanced through the incurrence of additional Indebtedness otherwise expressly permitted under the Credit Agreement, and (iii) payments made during the period under all leases that have been or should be, in accordance with GAAP as in effect for the Company's 2017 audited financial statement, recorded as capitalized leases. Beginning in 2020, the Company can elect to increase the maximum Funded Debt Leverage Ratio to 4.0 to 1 for four fiscal quarters immediately following the fiscal quarter in which the Company acquires another business, with the maximum permitted ratio reducing back to 3.5 to 1 in the fifth fiscal quarter following such acquisition. The Company can make this election twice during the term of the Credit Agreement. The Credit Agreement also limits the Company’s ability to, among other things, create liens, make investments, incur more indebtedness, merge or consolidate, make dispositions of property, pay dividends and make distributions to stockholders or repurchase our stock, enter into a new line of business, enter into transactions with affiliates and enter into burdensome agreements. The Credit Agreement does not limit the Company’s ability to acquire other businesses or companies except that the acquired business or company must be in the Company's line of business, the Company must be in compliance with the financial covenants on a pro forma basis after taking into account the acquisition, and, if the acquired business is a separate subsidiary, in certain circumstances the lenders will receive the benefit of a guaranty of the subsidiary and liens on its assets and a pledge of its stock. As of December 31, 2019, the Company was in compliance with the terms of the Credit Agreement, and has undertaken to continuously monitor compliance with these covenants. Subsequent Event On March 9, 2020, the Credit Agreement was amended to provide that the maximum Funded Debt Leverage Ratio is 4.0 to 1 for the quarters ended December 31, 2019 through June 30, 2020; 3.75 to 1 for the quarter ending September 30, 2020; and 3.5 to 1 for the quarter ending December 31, 2020 and or each quarter end thereafter, and increased the maximum LIBOR margin from 2.0% to 2.25% if the Funded Debt Leverage Ratio exceeds 3.75 to 1. The amendment also requires that prior to the first time the Company makes an election to increase the Funded Debt Leverage Ratio to 4.0 to 1 in connection with an acquisition, the Company must obtain the consent of lenders (in their sole discretion) holding at least 66-2/3% of the credit exposure under the Credit Agreement. The March 9, 2020 amendment to the Credit Agreement also provides that for acquisitions completed prior to April 1, 2021, (a) the aggregate consideration for all acquisitions made on or after March 9, 2020 and prior to April 1, 2021 shall not exceed $5,000,000, and (b) prior to the first of any such acquisition, the Company shall have demonstrated a Funded Debt Leverage Ratio of not greater than 3.0 to 1.0 for two consecutive fiscal quarters immediately prior to such acquisition. Notes Payable and Other Debt The Company's other debt includes local bank financing provided at the local subsidiary levels used to support working capital requirements and fund capital expenditures. At December 31, 2019, there was approximately $8.0 million outstanding, payable at various times through 2029. Monthly payments range from $1 thousand to $18 thousand. Interest rates range from 0.4% to 6.2%. Scheduled principal payments due under all borrowing agreements in each of the five years and thereafter subsequent to December 31, 2019 are as follows: 2020 $ 6,593 2021 8,864 2022 11,210 2023 225,343 2024 890 Thereafter 1,813 Total $ 254,713 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company performs fair value measurements in accordance with the guidance provided by ASC 820, Fair Value Measurements and Disclosures . ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a three level hierarchy that prioritizes the inputs used to measure fair value. The three levels of the hierarchy are defined as follows: Level 1 — Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 — Observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability and inputs derived principally from or corroborated by observable market data. Level 3 — Unobservable inputs reflecting the Company’s own assumptions about inputs that market participants would use in pricing the asset or liability based on the best information available. Financial instruments measured at fair value on a recurring basis The fair value of contingent consideration liabilities was estimated using a discounted cash flow technique with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC 820. The significant inputs in the Level 3 measurement not supported by market activity include the probability assessments of expected future cash flows related to the acquisitions, appropriately discounted considering the uncertainties associated with the obligation, and as calculated in accordance with the terms of the applicable acquisition agreements. The following table represents the changes in the fair value of Level 3 contingent consideration: Balance at December 31, 2017 $ 5,508 Acquisitions — Payments (2,277) Accretion of liability 175 Revaluation (891) Foreign currency translation (150) Balance at December 31, 2018 $ 2,365 Acquisitions 1,142 Payments (852) Accretion of liability 92 Revaluation 419 Foreign currency translation 50 Balance at December 31, 2019 $ 3,216 Financial instruments not measured at fair value on a recurring basis The Company has evaluated current market conditions and borrower credit quality and has determined that the carrying value of its long-term debt approximates fair value. The fair value of the Company’s notes payable and finance and operating lease obligations approximates their carrying amounts based on anticipated interest rates which management believes would currently be available to the Company for similar issuances of debt. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation The Company has share-based incentive awards outstanding to its eligible employees and directors under two employee stock ownership plans: (i) the 2009 Long-Term Incentive Plan (the "2009 Plan") and (ii) the 2016 Long-Term Incentive Plan (the "2016 Plan"). No further awards may be granted under the 2009 Plan, although awards granted under the 2009 Plan remain outstanding in accordance with their terms. Awards granted under the 2016 Plan may be in the form of stock options, restricted stock units and other forms of share-based incentives, including performance restricted stock units, stock appreciation rights and deferred stock rights. The 2016 Plan allows for the grant of awards of up to approximately 1,700,000 shares of common stock, of which 718,000 shares were available for future grants as of December 31, 2019. As of December 31, 2019, there was an aggregate of approximately 5,000 stock options outstanding and approximately 101,000 unvested restricted stock units outstanding under the 2009 Plan. Stock Options For the years ended December 31, 2019, 2018 and 2017, the Company did not have any share-based compensation expense related to stock option awards. No stock options were granted during the years ended December 31, 2019, 2018 and 2017. As of December 31, 2019, no unrecognized compensation costs remained related to stock option awards. Cash proceeds from, and the intrinsic value of, stock options exercised during the years ended December 31, 2019, 2018 and 2017 were as follows (in thousands): For the year ended December 31, 2019 1 2018 2017 Cash proceeds from options exercised $ 32 $ 273 $ 275 Aggregate intrinsic value of options exercised $ 4,530 $ 277 $ 580 ____________________ 1 During 2019, 2.1 million stock options were net exercised, wherein the option holders surrendered a portion of the underlying stock option awards to pay the exercise price and required minimum tax withholding. A summary of the stock option activity, weighted average exercise prices, and options outstanding and exercisable as of December 31, 2019, 2018 and 2017 is as follows (in thousands, except per share amounts and years): For the years ended December 31, 2019 2018 2017 Common Weighted Common Stock Options Weighted Average Exercise Price Common Weighted Outstanding at beginning of year: 2,105 $ 13.47 2,130 $ 13.43 2,167 $ 13.33 Granted — $ — — $ — — $ — Exercised (2,093) $ 13.45 (25) $ 10.75 (37) $ 7.39 Expired or forfeited (7) $ 10.00 — $ — — $ — Outstanding at end of year: 5 $ 22.35 2,105 $ 13.47 2,130 $ 13.43 December 31, 2019 Options Outstanding Options Exercisable Exercise Price Total Options Outstanding Weighted Average Remaining Life (Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $22.35 5 2.2 $ 22.35 5 $ 22.35 Aggregate Intrinsic Value $ — $ — Restricted Stock Unit Awards Restricted Stock Units generally vest ratably on each of the first four anniversary dates of issuance. The Company recognized approximately $4.0 million, $4.2 million and $4.5 million of share-based compensation for the years ended December 31, 2019, 2018 and 2017, respectively, related to restricted stock unit awards. As of December 31, 2019, there were approximately $6.7 million of unrecognized compensation costs, net of estimated forfeitures, related to restricted stock unit awards, which are expected to be recognized over a remaining weighted average period of 2.4 years. Upon vesting, restricted stock units are generally net share-settled to cover the required minimum withholding tax and the remaining amount is converted into an equivalent number of shares of common stock. A summary of the vesting activity of restricted stock unit awards, with the respective fair value of the awards, is as follows: (in thousands): For the year ended December 31, 2019 2018 2017 Restricted stock awards vested 172 258 185 Fair value of awards vested $ 2,495 $ 5,319 $ 3,429 A summary of the fully-vested common stock the Company issued to its six non-employee directors, in connection with its non-employee director compensation plan, is as follows (in thousands): For the year ended December 31, 2019 2018 2017 Awards issued 30 19 21 Grant date fair value of awards issued $ 450 $ 400 $ 438 A summary of the Company's outstanding, non-vested restricted share units is presented below (in thousands, except per share amounts): For the year ended December 31, 2019 2018 2017 Units Weighted Units Weighted Units Weighted Outstanding at beginning of period: 443 $ 20.55 532 $ 21.05 569 $ 20.81 Granted 339 $ 14.04 211 $ 19.20 183 $ 21.26 Released (172) $ 20.38 (258) $ 20.48 (185) $ 20.49 Forfeited (51) $ 17.71 (42) $ 20.52 (35) $ 21.45 Outstanding at end of period: 559 $ 16.92 443 $ 20.55 532 $ 21.05 Performance Restricted Stock Units The Company maintains Performance Restricted Stock Units (PRSUs) that have been granted to select executives and senior officers whose ultimate payout is based on the Company’s performance over a one four five PRSUs are equity-classified and compensation costs are initially measured using the fair value of the underlying stock at the date of grant, assuming that the target performance conditions will be achieved. Cumulative compensation costs related to the PRSUs are subsequently adjusted for changes in the expected outcomes of the performance conditions. Discretionary PRSUs are liability-classified and adjusted to fair value (with a corresponding adjustment to compensation expense) based upon the targeted number of shares to be awarded and the fair value of the underlying stock each reporting period until approved by the Compensation Committee, at which point they are classified as equity. A summary of the Company's PRSU activity is presented below (in thousands, except per share amounts): For the year ended December 31, 2019 2018 2017 Units Weighted Units Weighted Units Weighted Outstanding at beginning of period: 277 $ 17.80 278 $ 17.00 290 $ 16.01 Granted 190 $ 13.63 129 $ 19.46 128 $ 20.42 Performance condition adjustments, net (106) $ 13.77 (50) $ 19.48 (68) $ 20.55 Released (101) $ 17.19 (68) $ 16.03 (72) $ 15.82 Forfeited — $ — (12) $ 16.16 — $ — Outstanding at end of period: 260 $ 16.77 277 $ 17.80 278 $ 17.00 For the year ended December 31, 2019, 190,000 PRSUs were granted. There was a 103,000 unit reduction to these awards, which represents Company performance below target, during the year ended December 31, 2019. As of December 31, 2019, the aggregate liability related to 29,000 outstanding discretionary PRSUs was less than $0.1 million and is classified within Accrued expenses and other liabilities on the consolidated balance sheet. For the year ended December 31, 2018, 129,000 PRSUs were granted. There was a 54,000 unit reduction to these awards, which represents Company performance below target, during the year ended December 31, 2018. As of December 31, 2018, the aggregate liability related to 22,000 outstanding discretionary PRSUs was less than $0.1 million and is classified within Accrued expenses and other liabilities on the consolidated balance sheet. The Compensation Committee approved these PRSUs during the first quarter of 2019, which further reduced these awards by 3,000 units. The discretionary portion of these awards were reclassified from a liability to equity on the consolidated balance sheet upon Compensation Committee approval. For the year ended December 31, 2017, 128,000 PRSUs were granted. There was a 65,000 unit reduction to these awards, which represents Company performance below target, during the year ended December 31, 2017. The Compensation Committee approved these PRSUs in the first quarter of 2018, which increased them by 4,000 units. The discretionary portion of these awards were reclassified from a liability to equity on the consolidated balance sheet upon Compensation Committee approval. Compensation expense related to all PRSUs described above was $1.3 million, $1.5 million, and $1.7 million for the years ended December 31, 2019, 2018 and 2017, respectively. At December 31, 2019, there was $1.7 million of total unrecognized compensation costs related to approximately 260,000 unvested performance restricted stock units. These costs are expected to be recognized over a weighted-average period of approximately 2.0 years. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income before provision for income taxes is as follows: For the year ended December 31, 2019 2018 2017 Income (loss) before provision for income taxes from: U.S. operations $ 7,334 $ 9,853 $ (7,303) Foreign operations 3,105 4,418 7,077 Earnings (loss) before income taxes $ 10,439 $ 14,271 $ (226) The provision for income taxes consists of the following: For the year ended December 31, 2019 2018 2017 Current Federal $ 2,712 $ 790 $ 3,558 States and local 519 533 39 Foreign 4,572 3,824 3,131 Reserve for uncertain tax positions 99 337 71 Total current 7,902 5,484 6,799 Deferred Federal 315 2,966 (3,857) States and local (32) 399 (810) Foreign (4,095) (2,089) (159) Total deferred (3,812) 1,276 (4,826) Net change in valuation allowance 269 666 (31) Net deferred (3,543) 1,942 (4,857) Provision for income taxes $ 4,359 $ 7,426 $ 1,942 The provision for income taxes differs from the amount computed by applying the statutory federal tax rate to income tax as follows: For the years ended December 31, 2019 2018 2017 Federal tax at statutory rate $ 2,192 21.0 % $ 2,997 21.0 % $ (79) 35.0 % State taxes, net of federal benefit 377 3.6 % 737 5.1 % (502) 221.6 % Foreign tax 982 9.4 % 807 5.7 % 217 (95.8) % Contingent consideration 29 0.3 % (6) — % (63) 27.7 % Nondeductible compensation 1,581 15.2 % 183 1.3 % — — % US taxation of foreign earnings 213 2.0 % 228 1.6 % — — % Permanent differences 464 4.4 % 361 2.5 % 377 (166.4) % Transition tax, net of foreign tax credits — — % 1,158 8.1 % 3,942 (1,741.4) % Federal tax rate change due to the Tax Act — — % 87 0.6 % (1,956) 864.0 % Other 134 1.3 % 208 1.4 % 37 (16.3) % Change in valuation allowance 269 2.6 % 666 4.7 % (31) 13.7 % Impact of foreign tax rate changes (1,882) (18.0) % — — % — — % Total provision for income taxes $ 4,359 41.8 % $ 7,426 52.0 % $ 1,942 (857.9) % The permanent differences identified above include normal recurring differences, such as meals, entertainment and parking fringe benefits. On June 28, 2019, the Canadian province of Alberta enacted the Job Creation Tax Cut which reduced the Alberta corporate income tax rate from 12% to 11% starting in 2019 with further annual reductions to 10% in 2020, 9% in 2021, and 8% in 2022. This rate reduction had a favorable impact of approximately $1.9 million on the Company’s net deferred tax liabilities in this jurisdiction. On December 22, 2017, the United States enacted fundamental changes to the federal tax law following the passage of the Tax Cuts and Jobs Act (the "Tax Act"). The Tax Act is complex and significantly changes the U.S. corporate tax system by, among other things, (a) reducing the federal corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017, (b) replacing the prior system of taxing corporations on foreign earnings of their foreign subsidiaries when the earnings are repatriated with a partial territorial tax system that provides a 100% dividends-received deduction (DRD) to domestic corporations for foreign-sourced dividends received from 10%-or-more owned foreign corporations, (c) subjecting certain unrepatriated foreign earnings to a mandatory one-time transition tax on post-1986 earnings and profits ("the transition tax"), and (d) further limiting a public entity's ability to deduct compensation in excess of $1 million for covered employees. The United States enacted the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The CARES Act is an approximately $2 trillion emergency economic stimulus package in response to the Coronavirus outbreak, which among other things contains numerous income tax provisions. Some of these tax provisions are expected to be effective retroactively for years ending before the date of enactment. The Company is currently evaluating the impact of the CARES Act on its consolidated financial position, results of operations, and cash flows. For the financial statements for the year ended December 31, 2017, the Company had reasonably estimated the tax effects of the Tax Act. The effect of the change in federal corporate tax rate from 35% to 21% was subject to change based on resolution of estimates used in determining the amounts of deferred tax assets and liabilities that were remeasured. The Company's calculation of the transition tax was subject to further refinement as more information was gathered from its foreign subsidiaries, estimates used in the calculation were resolved, and as states provided guidance on how the transition tax may or may not apply in their respective jurisdictions. The Company also anticipated that the deferred tax asset related to executive compensation would change based upon actual 2018 compensation as compared to its projections of compensation that were limited. Finally, the Tax Act also imposes a minimum tax on certain foreign income deemed to be in excess of a routine return based on tangible asset investment, which is designed to discourage income shifting by subjecting certain foreign intangibles and other income to current US tax. Effective for tax years beginning after 2017, US shareholders of certain foreign corporations are subject to current U.S. tax on their global intangible low-taxed income (GILTI). As of December 31, 2017, the Company had not yet evaluated its potential liability, if any, under the minimum tax for GILTI in 2018 or future years. Accordingly, the Company had not yet made an accounting policy election either to account for these effects in the future period when the tax arises or to recognize them as part of the deferred taxes. The impact on income tax expense related to the Tax Act for 2017 was $1.9 million. This amount reflects a net tax benefit of $2.3 million as a result of the Tax Act due to the remeasurement of federal deferred tax assets and liabilities from 35% to 21%. This amount also includes a charge of $3.9 million due to the transition tax. Additionally, the Company incurred a charge attributable to reducing its deferred tax assets by $0.3 million due to changes made to executive compensation rules pursuant to the Tax Act. During the year ended December 31, 2018, the Company completed its accounting for the effects of the Tax Act on the period ended December 31, 2017, which resulted in income tax expense of $1.7 million. This consisted primarily of $0.1 million of an increase in the Company's net deferred tax liabilities due to the reduction in the federal corporate rate from 35% to 21%, an increase of $1.3 million in tax expense attributable to the transition tax and a decrease in deferred tax assets of $0.4 million due to changes made to executive compensation. Deferred income tax attributes resulting from differences between financial accounting amounts and income tax basis of assets and liabilities are as follows: December 31, 2019 2018 Deferred income tax assets Allowance for doubtful accounts $ 1,186 $ 951 Inventory 359 285 Intangible assets 1,795 1,230 Accrued expenses 4,421 4,408 Net operating loss carryforward 3,832 3,653 Finance lease obligations 1,067 731 Capital losses 463 462 Deferred share-based compensation 1,145 3,728 Interest carryforward 1,372 — Right-of-use liability 11,891 — Other 398 699 Deferred income tax assets 27,929 16,147 Valuation allowance (4,067) (3,999) Net deferred income tax assets 23,862 12,148 Deferred income tax liabilities Property and equipment (6,485) (7,597) Goodwill (10,652) (9,302) Intangible assets (14,311) (16,459) Right-of-use asset (11,891) — Other (27) (8) Deferred income tax liabilities (43,366) (33,366) Net deferred income taxes $ (19,504) $ (21,218) As of December 31, 2019, the Company had federal net operating loss carry forwards (NOLs) in the amount of approximately $0.2 million which may be utilized subject to limitation under Internal Revenue Code section 382. The federal NOLs expire at various times from 2032 to 2038. In addition, as of December 31, 2019, the Company had state and foreign NOLs of $7.2 million and $12.3 million, respectively. The state NOLs expire at various times from 2025 to 2039. Approximately $0.6 million of the foreign NOLs expire at various times from 2025 to 2039, while the remainder of the Company's foreign NOLs do not expire. In assessing the ability to realize deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. Valuation allowances are provided when management believes the Company's deferred tax assets are not recoverable based on an assessment of estimated future taxable income that incorporates ongoing, prudent and feasible tax planning strategies. At December 31, 2019 and December 31, 2018, the Company has a valuation allowance of approximately $4.1 million and $4.0 million, respectively, primarily against certain state and foreign NOLs, capital losses generated by the disposals of certain foreign subsidiaries and other specific deferred tax assets. The increase of $0.1 million is primarily attributable to foreign net operating losses. Except for those deferred tax assets subject to the valuation allowance, management believes that it will realize all deferred tax assets as a result of sufficient future taxable income in each tax jurisdiction in which the Company has deferred tax assets. The following table summarizes the changes in the Company’s gross unrecognized tax benefits, excluding interest and penalties: For the year ended December 31, 2019 2018 Balance at beginning of period $ 723 $ 156 Additions for tax positions related to the current fiscal period — 1 Additions for tax positions related to prior years 217 341 Decreases for tax positions related to prior years — (2) Current year acquisitions — 270 Impact of foreign exchange fluctuation 13 — Settlements (465) (4) Reductions related to the expiration of statutes of limitations (95) (39) Balance at end of period $ 393 $ 723 The Company has recorded the unrecognized tax benefits in other long-term liabilities in the consolidated balance sheets. As of December 31, 2019 and December 31, 2018, there were approximately $0.4 million and $0.7 million of unrecognized tax benefits, respectively, including penalties and interest. If the Company recognized these unrecognized tax benefits, approximately $0.1 million would favorably affect the effective tax rate for both December 31, 2019 and 2018. Interest and penalties related to unrecognized tax benefits are recorded in income tax expense and are not significant for the years ended December 31, 2019, 2018 and 2017. The Company anticipates a decrease to its unrecognized tax benefits of less than $0.1 million excluding interest and penalties within the next 12 months. The Company is subject to taxation in the United States and various states and foreign jurisdictions. The Company is no longer subject to U.S. federal income tax examinations for years ending before May 31, 2016 and generally is no longer subject to state, local or foreign income tax examinations by tax authorities for years ending before May 31, 2016. Net income (loss) of foreign subsidiaries was $2.5 million, $2.0 million, and $4.1 million for the years ended December 31, 2019, 2018 and 2017, respectively. Generally, it has been the Company's practice and intention to reinvest the earnings of its non-U.S. subsidiaries in those operations. As previously noted, the Tax Act made significant changes to the taxation of undistributed earnings, requiring that all previously untaxed earnings and profits of the Company's controlled foreign operations be subjected to the transition tax. Since these earnings have now been subjected to U.S. federal tax they would only be potentially subject to limited other taxes, including foreign withholding and certain state taxes. As of December 31, 2019, the Company has not recognized a deferred tax liability for foreign withholdings and state taxes on its undistributed international earnings or losses of its foreign subsidiaries since it intends to indefinitely reinvest the earnings outside the United States. The Company has estimated that the amount of the unrecorded deferred tax liability related to undistributed international earnings is approximately $1.1 million. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company provides a 401(k) savings plan for eligible U.S. based employees. Employee contributions are discretionary up to the IRS limits each year and catch up contributions are allowed for employees 50 years of age or older. Under the 401(k) plan, employees become eligible to participate on the first day of the month after three months of continuous service. Under this plan, the Company matches 50% of the employee’s contributions up to 6% of the employee’s annual compensation, as defined by the plan. There is a five The Company's subsidiary participated with other employers in contributing to the Boilermaker-Blacksmith National Pension Trust (EIN 48-6168020) (“Boilermakers”) and Plumbers and Pipefitters National Pension Fund (EIN 52-6152779) (“Pipefitters”), multi-employer defined benefit pension plans, which covers certain U.S. based union employees. The plans provide multiple plan benefits with corresponding contribution rates that are collectively bargained between participating employers and their affiliated Boilermakers and Pipefitters local unions. Both the Boilermakers and Pipefitters plans are between 65 percent and 80 percent funded as of the latest Form 5500 filed. The Company did not make any contributions to the Boilermakers or Pipefitters plans during the year ended December 31, 2019. The Company’s contributions to the Boilermakers and Pipefitters plans, collectively, were $0.6 million and $2.4 million for the years ended December 31, 2018 and 2017, respectively. See Note 18– Commitments and Contingencies, Pension Related Contingencies, for additional detail. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company leases its headquarters under an operating lease from a shareholder and officer of the Company. On August 1, 2014, the Company extended its lease at its headquarters requiring monthly payments through October 2024. Total rent payments made during the year ended December 31, 2019 were approximately $1.0 million. See Note 17– Leases for further detail. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company leases certain office and operating facilities, machinery, equipment, and vehicles. Concurrent with the adoption of ASC 842, the Company recognized a right-of-use (ROU) asset and lease liability based on the present value of the future lease payments over the lease term for each lease agreement. The Company has elected not to recognize a ROU asset and lease liability for leases with terms of 12 months or less and will continue to recognize lease expense for these leases on a straight-line basis over the lease term. The Company has leases with both lease components and non-lease components, such as common area maintenance, utilities, or other repairs and maintenance. For all asset classes, the Company decided to utilize the practical expedient to include both fixed lease components and fixed non-lease components in calculating the ROU asset and lease liability. The Company identified variable lease payments, such as maintenance payments based on actual activities performed or costs incurred, at lease commencement by assessing the nature of the payment provisions, including whether the payments are subject to a minimum charge. Many of our leases include one or more options to renew. When it is reasonably certain that we will exercise the option, we include the impact of the option in the lease term for purposes of determining future lease payments. As the Company is unable to determine the discount rate implicit in its lease agreements, the Company uses its incremental borrowing rate on the commencement date to calculate the present value of future payments. The Company’s Consolidated Balance Sheets include the following related to operating leases as of December 31, 2019: Leases Classification 2019 Assets: ROU assets Other Assets $ 45,817 Liabilities: ROU liability - current Accrued and other current liabilities $ 10,133 ROU liability - long-term Other liabilities 36,750 Total ROU liabilities $ 46,883 Included within the balance of operating leases is a lease for the Company’s headquarters which is with a related party. The ROU liability for this facility is approximately $4.5 million as of December 31, 2019 and total rent payments made during the year ended December 31, 2019 approximates $1.0 million. As of December 31, 2019, the total ROU assets attributable to finance leases are approximately $19.2 million, which is included in Property, plant, and equipment, net on the Consolidated Balance Sheets. The components of lease costs for the year ended December 31, 2019 is as follows: Classification 2019 Finance lease expense: Amortization of ROU assets Depreciation and amortization $ 5,091 Interest on lease liabilities Interest expense 824 Operating lease expense Cost of revenue; Selling, general & administrative expenses 12,937 Short-term lease expense Cost of revenue; Selling, general & administrative expenses 43 Variable lease expense Cost of revenue; Selling, general & administrative expenses 1,220 Total $ 20,115 Additional information related to leases as of December 31, 2019 is as follows: 2019 Cash paid for amounts included in the measurement of lease liabilities for finance leases: Finance - financing cash flows $ 4,545 Finance - operating cash flows 824 Operating - operating cash flows 12,773 ROU assets obtained in the exchange for lease liabilities: Finance leases $ 9,502 Operating leases 18,965 Weighted-average remaining lease term (in years): Finance leases 5.9 Operating leases 6.2 Weighted-average discount rate: Finance leases 5.8 % Operating leases 5.9 % Maturities of lease liabilities as of December 31, 2019 is as follows: Finance Operating 2020 $ 6,241 $ 12,466 2021 4,255 10,347 2022 3,381 8,193 2023 2,489 6,790 2024 1,607 5,224 Thereafter 891 13,265 Total 18,864 56,285 Less: Present value discount 1,690 9,402 Lease liability $ 17,174 $ 46,883 Pursuant to the Company’s adoption of the new lease accounting guidance using a modified retrospective transition approach, as permitted, comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. As previously disclosed in its 2018 Annual Report, the following table presents the Company’s future minimum operating lease commitments as of December 31, 2018: 2019 $ 10,939 2020 8,764 2021 6,327 2022 4,826 2023 4,239 Thereafter 10,667 Total $ 45,762 |
Leases | Leases The Company leases certain office and operating facilities, machinery, equipment, and vehicles. Concurrent with the adoption of ASC 842, the Company recognized a right-of-use (ROU) asset and lease liability based on the present value of the future lease payments over the lease term for each lease agreement. The Company has elected not to recognize a ROU asset and lease liability for leases with terms of 12 months or less and will continue to recognize lease expense for these leases on a straight-line basis over the lease term. The Company has leases with both lease components and non-lease components, such as common area maintenance, utilities, or other repairs and maintenance. For all asset classes, the Company decided to utilize the practical expedient to include both fixed lease components and fixed non-lease components in calculating the ROU asset and lease liability. The Company identified variable lease payments, such as maintenance payments based on actual activities performed or costs incurred, at lease commencement by assessing the nature of the payment provisions, including whether the payments are subject to a minimum charge. Many of our leases include one or more options to renew. When it is reasonably certain that we will exercise the option, we include the impact of the option in the lease term for purposes of determining future lease payments. As the Company is unable to determine the discount rate implicit in its lease agreements, the Company uses its incremental borrowing rate on the commencement date to calculate the present value of future payments. The Company’s Consolidated Balance Sheets include the following related to operating leases as of December 31, 2019: Leases Classification 2019 Assets: ROU assets Other Assets $ 45,817 Liabilities: ROU liability - current Accrued and other current liabilities $ 10,133 ROU liability - long-term Other liabilities 36,750 Total ROU liabilities $ 46,883 Included within the balance of operating leases is a lease for the Company’s headquarters which is with a related party. The ROU liability for this facility is approximately $4.5 million as of December 31, 2019 and total rent payments made during the year ended December 31, 2019 approximates $1.0 million. As of December 31, 2019, the total ROU assets attributable to finance leases are approximately $19.2 million, which is included in Property, plant, and equipment, net on the Consolidated Balance Sheets. The components of lease costs for the year ended December 31, 2019 is as follows: Classification 2019 Finance lease expense: Amortization of ROU assets Depreciation and amortization $ 5,091 Interest on lease liabilities Interest expense 824 Operating lease expense Cost of revenue; Selling, general & administrative expenses 12,937 Short-term lease expense Cost of revenue; Selling, general & administrative expenses 43 Variable lease expense Cost of revenue; Selling, general & administrative expenses 1,220 Total $ 20,115 Additional information related to leases as of December 31, 2019 is as follows: 2019 Cash paid for amounts included in the measurement of lease liabilities for finance leases: Finance - financing cash flows $ 4,545 Finance - operating cash flows 824 Operating - operating cash flows 12,773 ROU assets obtained in the exchange for lease liabilities: Finance leases $ 9,502 Operating leases 18,965 Weighted-average remaining lease term (in years): Finance leases 5.9 Operating leases 6.2 Weighted-average discount rate: Finance leases 5.8 % Operating leases 5.9 % Maturities of lease liabilities as of December 31, 2019 is as follows: Finance Operating 2020 $ 6,241 $ 12,466 2021 4,255 10,347 2022 3,381 8,193 2023 2,489 6,790 2024 1,607 5,224 Thereafter 891 13,265 Total 18,864 56,285 Less: Present value discount 1,690 9,402 Lease liability $ 17,174 $ 46,883 Pursuant to the Company’s adoption of the new lease accounting guidance using a modified retrospective transition approach, as permitted, comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. As previously disclosed in its 2018 Annual Report, the following table presents the Company’s future minimum operating lease commitments as of December 31, 2018: 2019 $ 10,939 2020 8,764 2021 6,327 2022 4,826 2023 4,239 Thereafter 10,667 Total $ 45,762 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Proceedings and Government Investigations The Company is subject to periodic lawsuits, investigations and claims that arise in the ordinary course of business. The Company cannot predict with certainty the ultimate resolution of lawsuits, investigations and claims asserted against it. Except possibly for certain of the matters described below, the Company does not believe that any currently pending legal proceeding to which the Company is a party will have a material adverse effect on its business, results of operations, cash flows or financial condition. The costs of defense and amounts that may be recovered against the Company may be covered by insurance for certain matters. Litigation and Commercial Claims The Company was contracted to perform inspections of welds on various pipeline projects in Texas for a customer. As of December 31, 2019, approximately $1.4 million of past due receivables were outstanding from this customer. The customer provided the Company with notice in December 2019, alleging that the Company’s inspection of 66 welds (out of approximately 16,000 welds inspected) were not in compliance with the contract, claimed approximately $7.6 million in damages, and requested that the Company pay these damages and any other damages incurred. The Company has filed a lawsuit in the District Court of Bexar County, Texas, 37th Judicial District, in an action captioned Mistras Group, Inc. v. Epic Y-Grade Pipeline LP, to recover the $1.4 million and other amounts due to the Company. The customer filed a counterclaim, alleging breach of contract and seeking recovery of its alleged damages. The Company believes that any successful claim by the customer regarding the Company’s workmanship will be covered by insurance, subject to payment of a deductible. At this time, the Company is unable to determine whether it has any liability in connection with this matter and if so, the amount or range of any such liability, and accordingly, has not established any accruals for this matter. A Company vehicle was involved in an accident in which individuals were injured, property was damaged, and businesses allegedly impacted by the accident have claimed economic losses. One lawsuit has been filed by one of the injured individuals in the U.S. District Court for the District of Colorado, McAllister v. Mistras Group, Inc . The Company has insurance for these types of matters. Most of the claims have been settled, including the claims covered by the McAllister case, with the two remaining unresolved claims being for economic loss and property damage. All of the claims, including the two that have not yet been resolved, have been or are expected to be fully covered by the Company's insurance. Government Investigations In May 2015, the Company received a notice from the U.S. Environmental Protection Agency (“EPA”) that it performed a preliminary assessment at a leased facility the Company operates in Cudahy, California and would be investigating the site. The purpose of the investigation was to determine whether any hazardous materials were released from the facility. The Company has been informed that certain hazardous materials and pollutants have been found in the ground water in the general vicinity of the site and the EPA is attempting to ascertain the origination or source of these materials and pollutants. Given the historic industrial use of the site, the EPA determined that the site of the Cudahy facility should be examined, along with numerous other sites in the vicinity. The Company has not received any further notices from EPA regarding this matter. In addition, in 2018, the California Department of Toxic Substances Control notified the owner of the property that it will be performing an additional investigation at the property. At this time, the Company is unable to determine whether it has any liability in connection with this matter and if so, the amount or range of any such liability, and accordingly, has not established any accruals for this matter. Pension Related Contingencies The workforce of certain of the Company’s subsidiaries are unionized and the terms of employment for these workers are governed by collective bargaining agreements, or CBAs. Under these CBAs, the Company’s subsidiaries are required to contribute to the national pension funds for the unions representing these employees, which are multi-employer pension plans. The Company was notified that a significant project was awarded to another contractor in January 2018, and as a result, one of the Company’s subsidiaries experienced a significant reduction in the number of its employees covered by one of the CBAs. Under certain circumstances, such a reduction in the number of employees participating in multi-employer pension plans pursuant to this CBA could result in a complete or partial withdrawal liability to these multi-employer pension plans under the Employee Retirement Income Security Act of 1974 ("ERISA"). Management explored options to retain a level of union work that would avoid withdrawal liability to the pension plans, but concluded during the third quarter of 2018 that the Company's subsidiaries probably would not obtain sufficient union work to avoid withdrawal liability. Therefore, the Company determined that it is probable that its subsidiary will incur a withdrawal liability related to these multi-employer pension plans. Accordingly, the Company recorded a charge of $5.9 million during 2018 and $0.8 million during 2019 for this potential withdrawal liability. The Company’s subsidiary reached an agreement with one of the pension funds in September 2019 and made a final payment of $0.9 million in complete satisfaction of the withdrawal liability of the subsidiary. Excluding the settlement payment, the Company has made monthly payments totaling $3.3 million through December 31, 2019. The balance of the estimated total amount of this potential liability as of December 31, 2019 is approximately $2.5 million. Severance and labor disputes The Company’s German subsidiary provides employees to customers under temporary staff leasing arrangements. In April 2017, the German Labor Lease Act was passed in Germany limiting the duration of temporary workers to eighteen During 2018, the Company recorded approximately $1.2 million in charges related to labor claims against its Brazilian subsidiary, which are included within Selling, general and administrative expenses. These claims related to employees in a company acquired by the Brazilian subsidiary in a prior period. The Company believes it is entitled to indemnification from the sellers of the acquired company for most of these charges but has not recorded the expected recovery of indemnification for these labor claims as the amount and timing of collection is uncertain as of December 31, 2019. Acquisition and disposition related contingencies The Company is liable for contingent consideration in connection with certain of its acquisitions. As of December 31, 2019, total potential acquisition-related contingent consideration ranged from zero to approximately $7.9 million and would be payable upon the achievement of specific performance metrics by certain of the acquired companies over the next 2.8 years. With respect to the acquisition made in 2018, the Company has filed a claim with the sellers and the Company's insurance carrier through which the Company has representations and warranty insurance concerning certain matters that may impact the purchase price. This matter is currently being investigated and discussed with the sellers and the Company's insurance carrier. During 2018, the Company sold a subsidiary in the Products and Systems segment. As part of the sale, the Company entered into a three |
Segment Disclosure
Segment Disclosure | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Disclosure | Segment Disclosure The Company’s three operating segments are: • Services. This segment provides asset protection solutions predominantly in North America, with the largest concentration in the United States, followed by Canada, consisting primarily of NDT and inspection and engineering services that are used to evaluate the safety, structural integrity and reliability of critical energy, industrial and public infrastructure and commercial aerospace components. • International. This segment offers services as well as products and systems, similar to those of the other segments, to select markets within Europe, the Middle East, Africa, Asia and South America, but not to customers in China and South Korea, which are served by the Products and Systems segment. • Products and Systems. This segment designs, manufactures, sells, installs and services the Company’s asset protection products and systems, including equipment and instrumentation, predominantly in the United States. Costs incurred for general corporate services, including finance, legal, and certain other costs that are provided to the segments are reported within Corporate and eliminations. Sales to the International segment from the Products and Systems segment and subsequent sales by the International segment of the same items are recorded and reflected in the operating performance of both segments. Additionally, engineering charges and royalty fees charged to the Services and International segments by the Products and Systems segment are reflected in the operating performance of each segment. All such intersegment transactions are eliminated in the Company’s consolidated financial reporting. The accounting policies of the reportable segments are the same as those described in Note 1– Summary of Significant Accounting Policies and Practices . Segment income from operations is one of the primary performance measures used by the Chief Executive Officer, who is the chief operating decision maker, to assess the performance of each segment and make resource allocation decisions. Certain general and administrative costs such as human resources, information technology and training are allocated to the segments. Segment income from operations excludes interest and other financial charges and income taxes. Corporate and other assets are comprised principally of cash, deposits, property, plant and equipment, domestic deferred taxes, deferred charges and other assets. Corporate loss from operations consists of administrative charges related to corporate personnel and other charges that cannot be readily identified for allocation to a particular segment. Selected financial information by segment for the periods shown was as follows (intercompany transactions are eliminated in Corporate and eliminations): For the year ended December 31, 2019 2018 2017 Revenues Services $ 595,130 $ 574,619 $ 543,565 International 144,271 153,448 144,265 Products and Systems 18,583 23,426 23,297 Corporate and eliminations (9,398) (9,139) (10,157) $ 748,586 $ 742,354 $ 700,970 For the year ended December 31, 2019 2018 2017 Gross profit Services $ 165,513 $ 151,974 $ 139,160 International 43,145 45,464 38,974 Products and Systems 8,639 10,560 9,798 Corporate and eliminations — (124) (220) $ 217,297 $ 207,874 $ 187,712 For the year ended December 31, 2019 2018 2017 Income from operations Services $ 49,593 $ 47,126 $ 46,677 International 5,856 3,953 3,537 Products and Systems (529) 2,368 (16,991) Corporate and eliminations (30,783) (31,226) (29,063) $ 24,137 $ 22,221 $ 4,160 For the year ended December 31, 2019 2018 2017 Depreciation and amortization Services $ 28,854 $ 24,079 $ 21,649 International 8,285 8,846 7,768 Products and Systems 1,213 1,429 2,180 Corporate and eliminations 181 59 (214) $ 38,533 $ 34,413 $ 31,383 December 31, 2019 2018 Intangible assets, net Services $ 98,284 $ 98,362 International 9,814 11,143 Products and Systems 1,181 1,438 Corporate and eliminations 258 452 $ 109,537 $ 111,395 December 31, 2019 2018 Total assets Services $ 537,518 $ 523,506 International 153,380 146,535 Products and Systems 16,028 12,264 Corporate and eliminations 12,952 11,732 $ 719,878 $ 694,037 December 31, 2019 2018 Long-lived assets United States $ 233,679 $ 230,140 Other Americas 181,550 177,628 Europe 75,325 76,781 $ 490,554 $ 484,549 December 31, 2017 Revenue United States $ 466,683 Other Americas 86,870 Europe 132,421 Asia-Pacific 14,996 $ 700,970 Refer to Note 2– Revenue , for revenues by geographic area for the years ended December 31, 2019 and 2018. |
Repurchase of Common Stock
Repurchase of Common Stock | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Repurchase of Common Stock | Repurchase of Common StockOn October 7, 2015, the Company's Board of Directors approved a $50 million stock repurchase plan. The Company retired all of its repurchased shares during the fourth quarter of 2017. The Board of Directors approved the termination of the stock repurchase plan effective April 1, 2019. There were no repurchases of common stock under the stock repurchase plan during 2019 and 2018. |
Selected Quarterly Financial In
Selected Quarterly Financial Information (unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Information (unaudited) | Selected Quarterly Financial Information (unaudited) The following is a summary of the quarterly results of operations for calendar years 2019, 2018 and 2017. Quarter ended December 31, 2019 September 30, 2019 June 30, 2019 March 31, 2019 Revenues $ 178,991 $ 192,192 $ 200,616 $ 176,787 Gross Profit 50,583 57,769 60,071 48,874 Income (loss) from operations 2,335 10,779 15,419 (4,396) Net income (loss) attributable to Mistras Group, Inc. $ 829 $ 3,093 $ 7,431 $ (5,293) Earnings (loss) per common share: Basic $ 0.03 $ 0.11 $ 0.26 $ (0.19) Diluted $ 0.03 $ 0.11 $ 0.26 $ (0.19) Quarter ended December 31, 2018 September 30, 2018 June 30, 2018 March 31, 2018 Revenues $ 180,762 $ 182,169 $ 191,793 $ 187,630 Gross Profit 52,315 52,332 55,083 48,144 Income from operations 2,502 3,017 10,304 6,398 Net income (loss) attributable to Mistras Group, Inc. $ (1,061) $ (1,011) $ 6,000 $ 2,908 Earnings (loss) per common share: Basic $ (0.04) $ (0.04) $ 0.21 $ 0.10 Diluted $ (0.04) $ (0.04) $ 0.20 $ 0.10 Quarter ended December 31, 2017 September 30, 2017 June 30, 2017 March 31, 2017 Revenues $ 187,643 $ 179,570 $ 170,439 $ 163,318 Gross Profit 50,319 47,897 46,343 43,153 Income (loss) from operations 6,282 (10,375) 5,003 3,250 Net income (loss) attributable to Mistras Group, Inc. $ 884 $ (6,968) $ 2,217 $ 1,692 Earnings (loss) per common share: Basic $ 0.03 $ (0.25) $ 0.08 $ 0.06 Diluted $ 0.03 $ (0.25) $ 0.07 $ 0.06 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsIn March 2020, the World Health Organization recognized the novel strain of coronavirus, COVID-19, as a pandemic. The coronavirus outbreak has severely restricted the level of economic activity around the world. In response to this coronavirus outbreak, the governments of many countries, states, cities and other geographic regions have taken preventative or protective actions, such as imposing restrictions on travel and business operations and advising or requiring individuals to limit or forgo their time outside of their homes. Temporary closures of businesses have been ordered and numerous other businesses have temporarily closed voluntarily or restricted access to their premises. Further, individuals’ ability to travel has been curtailed through mandated travel restrictions and may be further limited through additional voluntary or mandated closures of travel-related businesses. A significant portion of the Company’s business and revenue is derived from our technicians and service people being physically located on site at our customer’s facilities. It is unclear at this point, as a result of government impositions and those of our customers, whether our personnel will be able to travel and gain admittance to our customer’s sites. In addition, to the extent COVID-19 impacts the financial performance of our customers, these customers may likewise look to further control their outside expenditures, including with respect to services performed by and products of the Company. As a result, the coronavirus outbreak may have a material adverse impact on the Company’s financial position, operations and cash flows in 2020. Given the uncertainty regarding the spread of this coronavirus, the related financial impact cannot be reasonably predicted or estimated at this time. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies and Practices (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying audited consolidated financial statements include the accounts of Mistras Group, Inc. and its wholly and majority-owned subsidiaries. For subsidiaries in which the Company’s ownership interest is less than 100%, the non-controlling interests are reported in stockholders’ equity in the accompanying consolidated balance sheets. The non-controlling interests in net income, net of tax, is classified separately in the accompanying consolidated statements of income (loss). All significant intercompany accounts and transactions have been eliminated in consolidation. |
Reclassifications | Reclassifications Certain amounts in prior periods have been reclassified to conform to the current year presentation. Such reclassifications did not have a material effect on the Company's financial condition or results of operations as previously reported. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with U.S. generally accepted accounting principles (GAAP) requires that the Company make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities at the date of financial statements. The Company bases its estimates and assumptions on historical experience, known or expected trends and various other assumptions that it believes to be reasonable. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates, which may cause the Company’s future results to be significantly affected. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. |
Accounts Receivable | Accounts Receivable |
Concentrations of Credit Risk | Concentration of Credit Risk For each of the years ended December 31, 2019 and 2018, no customer represented 10% or more of the Company's revenue. One customer represented 11% of the Company's revenue for the year ended December 31, 2017, which was primarily generated from the Services segment. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. At times, cash deposits may exceed the limits insured by the Federal Deposit Insurance Corporation. The Company believes it is not exposed to any significant credit risk or risk of nonperformance of financial institutions. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value, as determined by using the first-in, first-out method, or market. Work in process and finished goods inventory include material, direct labor, variable costs and overhead. |
Purchased and Internal-Use Software | Purchased and Internal-Use Software The Company capitalizes certain costs that are incurred to purchase or to create and implement internal-use software, which includes software coding, installation and testing. Capitalized costs are amortized on a straight-line basis over three years, the estimated useful life of the software. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are recorded at cost. Depreciation of property, plant and equipment is computed utilizing the straight-line method over the estimated useful lives of the assets. Amortization of leasehold improvements is computed utilizing the straight-line method over the shorter of the remaining lease term or estimated useful life. Repairs and maintenance costs are expensed as incurred. |
Goodwill | Goodwill Goodwill represents the excess purchase price of acquired businesses over the fair values attributed to underlying net tangible assets and identifiable intangible assets. The Company tests goodwill for impairment at a “reporting unit” level (which for the Company is represented by (i) our Services segment, (ii) our Products and Systems segment, and (iii) the European component of our International segment and (iv) the Brazilian component of our International segment). Our annual impairment test is conducted on the first day of our fourth quarter, which is October 1. Goodwill is also tested for impairment whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. If the fair value of a reporting unit is less than its carrying value, this is an indicator that the goodwill assigned to that reporting unit may be impaired. As a result of the Company adopting Accounting Standards Update ("ASU") No. 2017-04, Intangibles-Goodwill and Other (Topic 350) |
Impairment of Long-lived Assets | Impairment of Long-lived Assets The Company reviews the recoverability of its long-lived assets (or asset groups) whenever events or changes in circumstances indicate that the carrying amount of the long-lived asset (group) might not be recoverable. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future undiscounted cash flows. If the total expected future undiscounted cash flows are less than the carrying amount of the assets, a loss is recognized for the difference between fair value (computed based upon the expected future discounted cash flows) and the carrying value of the assets. |
Acquisitions | Acquisitions The Company allocates the purchase price of acquired businesses to their identifiable tangible assets and liabilities as well as identifiable intangible assets, such as customer relationships, technology, non-compete agreements and trade names. Certain estimates and judgments are required in the application of the fair value techniques, including estimates of the respective acquisition's future performance and related cash flows, selection of a discount rate and economic lives, and use of Level 3 measurements as defined in ASC No. 820, Fair Value Measurements and Disclosure. |
Research and Engineering | Research and Engineering Research and product development costs are expensed as incurred. |
Advertising, Promotions and Marketing | Advertising, Promotions and Marketing |
Fair Value of Financial Instruments | Fair Value of Financial Instruments |
Foreign Currency Translation | Foreign Currency Translation The financial position and results of operations of the Company’s foreign subsidiaries are measured using their functional currencies, which are their local currencies. Assets and liabilities of foreign subsidiaries are translated into the U.S. Dollar at the exchange rates in effect at the balance sheet date. Income and expenses are translated at the average exchange rate during the period. Translation gains and losses are reported as a component of other comprehensive (loss) income for the period and included in accumulated other comprehensive (loss) income within stockholders’ equity. |
Self-Insurance | Self-Insurance The Company is self-insured for certain losses relating to workers’ compensation and health benefit claims. The Company maintains third-party excess insurance coverage for all workers' compensation and health benefit claims in excess of approximately $0.3 million per occurrence to reduce its exposure from such claims. Self-insured losses are accrued when it is probable that an uninsured claim has been incurred but not reported and the amount of the loss can be reasonably estimated at the balance sheet date. |
Share-based Compensation | Share-based Compensation The value of services received from employees and directors in exchange for an award of an equity instrument is measured based on the grant-date fair value of the award. Such value is recognized as a non-cash expense on a straight-line basis over the period the individual provides services, which is typically the vesting period of the award with the exception of awards with graded vesting that contain an internal performance measure where each tranche is recognized on a straight-line basis over its vesting period subject to the probability of meeting the performance requirements and adjusted for the number of shares expected to be earned. As share-based compensation expense is based on awards ultimately expected to vest, the amount of expense is reduced for estimated forfeitures. The cost of these awards is recorded in selling, general and administrative expense in the Company’s consolidated statements of income. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided if it is more likely than not that some or all of a deferred income tax asset will not be realized. Financial accounting standards prescribe a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. These standards also provide guidance on de-recognition, measurement, and classification of amounts relating to uncertain tax positions, accounting for and disclosure of interest and penalties, accounting in interim periods and disclosures required. Interest and penalties related to unrecognized tax positions are recognized as incurred within “provision for income taxes” in the consolidated statements of income. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-02, Leases (Topic 842) , which the Company adopted as of January 1, 2019. Topic 842 requires the recognition of lease rights and obligations as assets and liabilities on the balance sheet. The Company elected the modified retrospective method permitted by the standard, upon which prior-period information has not been restated. The standard provided for several practical expedient options for use in transition. The Company elected to utilize the “package of practical expedients,” which permits the Company not to reassess previous conclusions reached on lease identification, lease classification and initial direct costs. The Company also elected to utilize the practical expedient available to not separate lease and non-lease components within the lease and has therefore accounted for all lease components as a single lease component. Adoption of the new standard resulted in the recording of a right-of-use (ROU) asset and liability related to the Company’s operating leases of approximately $38 million as of January 1, 2019. The new standard did not have a material impact to our statements of income or cash flows. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350). This amendment eliminates Step Two of the goodwill impairment test. Under the amendments in this update, entities should perform the annual goodwill impairment test by comparing the carrying value of their reporting units to their fair value. An entity should record an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. Tax deductibility of goodwill should be considered in evaluating any reporting unit's impairment loss to be taken. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company early adopted ASU 2017-04 in the third quarter of 2017 for its consolidated financial statements and related disclosures. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities related to outside basis differences. The standard is effective for interim and annual periods beginning January 1, 2021, with certain amendments applied prospectively and others requiring retrospective application. Early adoption is permitted, with any adjustments reflected as of the beginning of the fiscal year of adoption. If early adoption is elected, all changes as a result of the standard must be adopted in the same period. The Company is currently evaluating the impact of this guidance on its consolidated financial position, results of operations, and cash flows. |
Revenue | Revenue The majority of the Company's revenues are derived from providing services on a time and material basis and are short-term in nature. Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The majority of our contracts have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts and is, therefore, not distinct. The Company provides highly integrated and bundled inspection services to its customers. Some of our contracts have multiple performance obligations, most commonly due to the contract providing both goods and services. For contracts with multiple performance obligations, the Company allocates the contract’s transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. The primary method used to estimate standalone selling price is a relative selling price based on price lists. Contract modifications are not routine in the performance of our contracts. Generally, when contracts are modified, the modification is to account for changes in scope to the goods and services that are provided. In most instances, contract modifications are for goods or services that are distinct, and, therefore, are accounted for as a separate contract. Our performance obligations are satisfied over time as work progresses or at a point in time. The majority of our revenue recognized over time as work progresses is related to our service deliverables, which includes providing testing, inspection and mechanical services to our customers. Revenue is recognized over time based on time and material incurred to date which best portrays the transfer of control to the customer. The Company also utilizes an available practical expedient that provides for revenue to be recognized in an amount that corresponds directly with the value to the customer of the entity’s performance completed to date. Fixed fee arrangements are determined based on expected labor, material, and overhead to be consumed on fulfillment of such services. Revenue is recognized on a cost-to-cost method tracked on an input basis. The majority of our revenue recognized at a point in time is related to product sales when the customer obtains control of the asset, which is generally upon shipment to the customer. Contract costs include labor, material and overhead. The Company expects any significant remaining performance obligations to be satisfied within one Contract Estimates The majority of our revenues are short-term in nature. The Company has many Master Service Agreements (MSAs) that specify an overall framework and terms of contract when the Company and customers agree upon services or products to be provided. The actual contracting to provide services or furnish products are triggered by a work order, purchase order, or some similar document issued pursuant to a MSA which sets forth the scope of services and/or identifies the products to be provided. From time-to-time, the Company may enter into long-term contracts, which can range from several months to several years. Revenue on such long-term contracts is recognized as work is performed based on total costs incurred to date in relation to the total estimated costs for the performance of the contract at completion. This includes contract estimates of costs to be incurred for the performance of the contract. Cost estimation is based upon the professional knowledge and experience of our project managers, engineers and financial professionals. Factors that are considered in estimating the work to be completed include the availability of materials, the effect of any delays in our project performance and the recoverability of any claims. Whenever revisions of estimates, contract costs and/or contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period. |
Fair Value Measurements | Fair Value Measurements The Company performs fair value measurements in accordance with the guidance provided by ASC 820, Fair Value Measurements and Disclosures . ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a three level hierarchy that prioritizes the inputs used to measure fair value. The three levels of the hierarchy are defined as follows: Level 1 — Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 — Observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability and inputs derived principally from or corroborated by observable market data. Level 3 — Unobservable inputs reflecting the Company’s own assumptions about inputs that market participants would use in pricing the asset or liability based on the best information available. Financial instruments measured at fair value on a recurring basis The fair value of contingent consideration liabilities was estimated using a discounted cash flow technique with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC 820. The significant inputs in the Level 3 measurement not supported by market activity include the probability assessments of expected future cash flows related to the acquisitions, appropriately discounted considering the uncertainties associated with the obligation, and as calculated in accordance with the terms of the applicable acquisition agreements. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregated Revenues by Industry and Key Geographic Location | The following series of tables present our disaggregated revenues: Revenue by industry was as follows: Year ended December 31, 2019 Services International Products & Systems Corp/Elim Total Oil & Gas $ 390,815 $ 44,447 $ 756 $ — $ 436,018 Aerospace & Defense 51,390 41,224 1,237 — 93,851 Industrials 64,622 21,405 3,187 — 89,214 Power generation & Transmission 30,300 10,289 2,726 — 43,315 Other Process Industries 28,495 10,196 418 — 39,109 Infrastructure, Research & Engineering 14,269 9,520 9,316 — 33,105 Other 15,239 7,190 943 (9,398) 13,974 Total $ 595,130 $ 144,271 $ 18,583 $ (9,398) $ 748,586 Year ended December 31, 2018 Services International Products & Systems Corp/Elim Total Oil & Gas $ 378,904 $ 37,953 $ 1,255 $ — $ 418,112 Aerospace & Defense 50,500 54,853 2,355 — 107,708 Industrials 60,594 26,209 3,097 — 89,900 Power generation & Transmission 30,687 8,522 4,904 — 44,113 Other Process Industries 26,425 9,497 124 — 36,046 Infrastructure, Research & Engineering 11,283 9,032 5,246 — 25,561 Other 16,226 7,382 6,445 (9,139) 20,914 Total $ 574,619 $ 153,448 $ 23,426 $ (9,139) $ 742,354 Revenue per key geographic location was as follows: Year ended December 31, 2019 Services International Products & Systems Corp/Elim Total United States $ 487,408 $ 631 $ 12,011 $ (4,918) $ 495,132 Other Americas 104,081 7,659 407 (407) 111,740 Europe 2,342 127,581 1,940 (3,978) 127,885 Asia-Pacific 1,299 8,400 4,225 (95) 13,829 Total $ 595,130 $ 144,271 $ 18,583 $ (9,398) $ 748,586 Year ended December 31, 2018 Services International Products & Systems Corp/Elim Total United States $ 478,853 $ 568 $ 11,493 $ (3,500) $ 487,414 Other Americas 90,823 7,995 1,068 (1,638) 98,248 Europe 4,252 138,948 3,958 (3,846) 143,312 Asia-Pacific 691 5,937 6,907 (155) 13,380 Total $ 574,619 $ 153,448 $ 23,426 $ (9,139) $ 742,354 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Computations of Basic and Diluted Earnings Per Share | The following table sets forth the computations of basic and diluted earnings per share: For the year ended December 31, 2019 2018 2017 Basic earnings (loss) per share: Numerator: Net income (loss) attributable to Mistras Group, Inc. $ 6,060 $ 6,836 $ (2,175) Denominator Weighted average common shares outstanding 28,740 28,406 28,422 Basic earnings (loss) per share $ 0.21 $ 0.24 $ (0.08) Diluted earnings (loss) per share: Numerator: Net income (loss) attributable to Mistras Group, Inc. $ 6,060 $ 6,836 $ (2,175) Denominator Weighted average common shares outstanding 28,740 28,406 28,422 Dilutive effect of stock options outstanding 98 683 — Dilutive effect of restricted stock units outstanding 208 338 — 29,046 29,427 28,422 Diluted earnings (loss) per share $ 0.21 $ 0.23 $ (0.08) |
Schedule of Potential Common Shares Excluded From the Computation of Diluted Earnings Per Share | The following potential common shares were excluded from the computation of diluted earnings per share, as the effect would have been anti-dilutive: For the year ended December 31, 2019 2018 2017 Potential common stock attributable to restricted stock units (RSUs) and performance stock units (PSUs) outstanding (1) 42 1 353 Potential common stock attributable to stock options outstanding (1) 5 5 810 Total 47 6 1,163 (1) For the twelve months ended December 31, 2017, 805 and 351 shares related to stock options and RSUs/PSUs, respectively, were excluded from the calculation of diluted EPS due to the net loss for the period. |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable, Net | Accounts receivable consist of the following: December 31, 2019 2018 Trade accounts receivable $ 144,282 $ 152,511 Allowance for doubtful accounts (8,285) (4,187) Accounts receivable, net $ 135,997 $ 148,324 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following: December 31, 2019 2018 Raw materials $ 5,314 $ 6,975 Work in progress 1,549 1,019 Finished goods 3,957 2,640 Consumable supplies 2,593 2,419 Inventories $ 13,413 $ 13,053 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment, Net | Property, plant and equipment consist of the following: December 31, Useful Life 2019 2018 (Years) Land $ 2,672 $ 2,680 Building and improvements 30-40 24,537 24,338 Office furniture and equipment 5-8 17,227 16,170 Machinery and equipment 5-7 225,974 208,245 270,410 251,433 Accumulated depreciation and amortization (171,803) (157,538) Property, plant and equipment, net $ 98,607 $ 93,895 |
Acquisitions and Disposition (T
Acquisitions and Disposition (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of Estimated Fair Value of Assets Acquired and Liabilities Assumed at the Date of Acquisition | The following table summarizes the estimated fair value of the assets acquired and liabilities assumed, the Company's allocation of purchase price and any subsequent adjustments made during the year ended December 31, 2019 for the 2019 acquisition: 2019 Cash paid $ 4,380 Working capital adjustments (152) Fair value of contingent consideration 1,142 Total consideration $ 5,370 Current net assets $ 142 Other assets 34 Property, plant and equipment 65 Intangibles 3,594 Goodwill 1,535 Net assets acquired $ 5,370 |
Schedule of Acquisition-related Expenses | These amounts are recorded as acquisition-related expense, net, on the consolidated statements of income and were as follows for the years ended December 31, 2019, 2018 and 2017: For the year ended December 31, 2019 2018 2017 Due diligence, professional fees and other transaction costs $ 364 $ 1,248 $ 945 Adjustments to fair value of contingent consideration liabilities 511 (716) (463) Acquisition-related expense, net $ 875 $ 532 $ 482 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill by Segment | The changes in the carrying amount of goodwill by segment is shown below: Services International Products and Systems Total Balance at December 31, 2017 $ 165,801 $ 37,637 $ — $ 203,438 Goodwill acquired during the year 83,163 — — 83,163 Adjustments to preliminary purchase price allocations (1,977) — — (1,977) Foreign currency translation (3,511) (1,854) — (5,365) Balance at December 31, 2018 $ 243,476 $ 35,783 $ — $ 279,259 Goodwill acquired during the year 1,535 — — 1,535 Adjustments to preliminary purchase price allocations (2,332) — — (2,332) Foreign currency translation 4,536 (588) — 3,948 Balance at December 31, 2019 $ 247,215 $ 35,195 $ — $ 282,410 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Gross Amount and Accumulated Amortization of Intangible Assets | The gross carrying amount and accumulated amortization of intangible assets were as follows: December 31, 2019 2018 Useful Life (Years) Gross Accumulated Net Gross Accumulated Net Customer relationships 5-18 $ 113,861 $ (67,853) $ 46,008 $ 112,624 $ (60,993) $ 51,631 Software/Technology 3-15 77,914 (18,756) 59,158 67,240 (13,319) 53,921 Covenants not to compete 2-5 12,795 (11,630) 1,165 12,593 (10,825) 1,768 Other 2-12 10,813 (7,607) 3,206 10,317 (6,242) 4,075 Total $ 215,383 $ (105,846) $ 109,537 $ 202,774 $ (91,379) $ 111,395 |
Schedule of Expected Amortization Expense of Intangible Assets | Amortization expense in each of the five years and thereafter subsequent to December 31, 2019 related to the Company’s intangible assets is expected to be as follows: Expected Amortization Expense 2020 $ 13,864 2021 12,474 2022 12,042 2023 10,987 2024 9,870 Thereafter 50,300 Total $ 109,537 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following: December 31, 2019 2018 Accrued salaries, wages and related employee benefits $ 30,072 $ 29,959 Contingent consideration 2,614 1,687 Accrued workers' compensation and health benefits 4,467 5,086 Deferred revenues 5,860 5,046 Right-of-use liability - Operating 10,133 — Pension accrual 2,519 5,585 Other accrued expenses 25,724 26,532 Total accrued expenses and other current liabilities $ 81,389 $ 73,895 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consists of the following: December 31, 2019 2018 Senior credit facility $ 151,773 $ 181,656 Senior secured term loan, net of debt issuance costs of $0.1 million 94,919 99,897 Notes payable — 68 Other 8,021 8,999 Total debt 254,713 290,620 Less: Current portion (6,593) (6,833) Long-term debt, net of current portion $ 248,120 $ 283,787 |
Schedule of Principal Payments Due Under All Borrowing Agreements | Scheduled principal payments due under all borrowing agreements in each of the five years and thereafter subsequent to December 31, 2019 are as follows: 2020 $ 6,593 2021 8,864 2022 11,210 2023 225,343 2024 890 Thereafter 1,813 Total $ 254,713 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Changes in Fair Value Level 3 Contingent Consideration | The following table represents the changes in the fair value of Level 3 contingent consideration: Balance at December 31, 2017 $ 5,508 Acquisitions — Payments (2,277) Accretion of liability 175 Revaluation (891) Foreign currency translation (150) Balance at December 31, 2018 $ 2,365 Acquisitions 1,142 Payments (852) Accretion of liability 92 Revaluation 419 Foreign currency translation 50 Balance at December 31, 2019 $ 3,216 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Cash Proceeds and Aggregate Fair Value of Stock Options Exercised | Cash proceeds from, and the intrinsic value of, stock options exercised during the years ended December 31, 2019, 2018 and 2017 were as follows (in thousands): For the year ended December 31, 2019 1 2018 2017 Cash proceeds from options exercised $ 32 $ 273 $ 275 Aggregate intrinsic value of options exercised $ 4,530 $ 277 $ 580 ____________________ |
Schedule of Stock Options Activity | A summary of the stock option activity, weighted average exercise prices, and options outstanding and exercisable as of December 31, 2019, 2018 and 2017 is as follows (in thousands, except per share amounts and years): For the years ended December 31, 2019 2018 2017 Common Weighted Common Stock Options Weighted Average Exercise Price Common Weighted Outstanding at beginning of year: 2,105 $ 13.47 2,130 $ 13.43 2,167 $ 13.33 Granted — $ — — $ — — $ — Exercised (2,093) $ 13.45 (25) $ 10.75 (37) $ 7.39 Expired or forfeited (7) $ 10.00 — $ — — $ — Outstanding at end of year: 5 $ 22.35 2,105 $ 13.47 2,130 $ 13.43 |
Schedule of Stock Options Outstanding and Exercisable | December 31, 2019 Options Outstanding Options Exercisable Exercise Price Total Options Outstanding Weighted Average Remaining Life (Years) Weighted Average Exercise Price Number Exercisable Weighted Average Exercise Price $22.35 5 2.2 $ 22.35 5 $ 22.35 Aggregate Intrinsic Value $ — $ — |
Schedule of Vesting Activity of Restricted Stock Units | A summary of the vesting activity of restricted stock unit awards, with the respective fair value of the awards, is as follows: (in thousands): For the year ended December 31, 2019 2018 2017 Restricted stock awards vested 172 258 185 Fair value of awards vested $ 2,495 $ 5,319 $ 3,429 |
Schedule of Fully-vested Common Stocks Issued to Non-employee Directors | A summary of the fully-vested common stock the Company issued to its six non-employee directors, in connection with its non-employee director compensation plan, is as follows (in thousands): For the year ended December 31, 2019 2018 2017 Awards issued 30 19 21 Grant date fair value of awards issued $ 450 $ 400 $ 438 |
Schedule of Non-vested Restricted Share Units | A summary of the Company's outstanding, non-vested restricted share units is presented below (in thousands, except per share amounts): For the year ended December 31, 2019 2018 2017 Units Weighted Units Weighted Units Weighted Outstanding at beginning of period: 443 $ 20.55 532 $ 21.05 569 $ 20.81 Granted 339 $ 14.04 211 $ 19.20 183 $ 21.26 Released (172) $ 20.38 (258) $ 20.48 (185) $ 20.49 Forfeited (51) $ 17.71 (42) $ 20.52 (35) $ 21.45 Outstanding at end of period: 559 $ 16.92 443 $ 20.55 532 $ 21.05 |
Schedule of Performance Shares Units Activity | A summary of the Company's PRSU activity is presented below (in thousands, except per share amounts): For the year ended December 31, 2019 2018 2017 Units Weighted Units Weighted Units Weighted Outstanding at beginning of period: 277 $ 17.80 278 $ 17.00 290 $ 16.01 Granted 190 $ 13.63 129 $ 19.46 128 $ 20.42 Performance condition adjustments, net (106) $ 13.77 (50) $ 19.48 (68) $ 20.55 Released (101) $ 17.19 (68) $ 16.03 (72) $ 15.82 Forfeited — $ — (12) $ 16.16 — $ — Outstanding at end of period: 260 $ 16.77 277 $ 17.80 278 $ 17.00 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Before Provision for Income Taxes | Income before provision for income taxes is as follows: For the year ended December 31, 2019 2018 2017 Income (loss) before provision for income taxes from: U.S. operations $ 7,334 $ 9,853 $ (7,303) Foreign operations 3,105 4,418 7,077 Earnings (loss) before income taxes $ 10,439 $ 14,271 $ (226) |
Schedule of Provision for Income Taxes | The provision for income taxes consists of the following: For the year ended December 31, 2019 2018 2017 Current Federal $ 2,712 $ 790 $ 3,558 States and local 519 533 39 Foreign 4,572 3,824 3,131 Reserve for uncertain tax positions 99 337 71 Total current 7,902 5,484 6,799 Deferred Federal 315 2,966 (3,857) States and local (32) 399 (810) Foreign (4,095) (2,089) (159) Total deferred (3,812) 1,276 (4,826) Net change in valuation allowance 269 666 (31) Net deferred (3,543) 1,942 (4,857) Provision for income taxes $ 4,359 $ 7,426 $ 1,942 |
Schedule of Provision for Income Taxes Computed by Applying Statutory Federal Tax Rate | The provision for income taxes differs from the amount computed by applying the statutory federal tax rate to income tax as follows: For the years ended December 31, 2019 2018 2017 Federal tax at statutory rate $ 2,192 21.0 % $ 2,997 21.0 % $ (79) 35.0 % State taxes, net of federal benefit 377 3.6 % 737 5.1 % (502) 221.6 % Foreign tax 982 9.4 % 807 5.7 % 217 (95.8) % Contingent consideration 29 0.3 % (6) — % (63) 27.7 % Nondeductible compensation 1,581 15.2 % 183 1.3 % — — % US taxation of foreign earnings 213 2.0 % 228 1.6 % — — % Permanent differences 464 4.4 % 361 2.5 % 377 (166.4) % Transition tax, net of foreign tax credits — — % 1,158 8.1 % 3,942 (1,741.4) % Federal tax rate change due to the Tax Act — — % 87 0.6 % (1,956) 864.0 % Other 134 1.3 % 208 1.4 % 37 (16.3) % Change in valuation allowance 269 2.6 % 666 4.7 % (31) 13.7 % Impact of foreign tax rate changes (1,882) (18.0) % — — % — — % Total provision for income taxes $ 4,359 41.8 % $ 7,426 52.0 % $ 1,942 (857.9) % |
Schedule of Deferred Income Tax Assets and Liabilities | Deferred income tax attributes resulting from differences between financial accounting amounts and income tax basis of assets and liabilities are as follows: December 31, 2019 2018 Deferred income tax assets Allowance for doubtful accounts $ 1,186 $ 951 Inventory 359 285 Intangible assets 1,795 1,230 Accrued expenses 4,421 4,408 Net operating loss carryforward 3,832 3,653 Finance lease obligations 1,067 731 Capital losses 463 462 Deferred share-based compensation 1,145 3,728 Interest carryforward 1,372 — Right-of-use liability 11,891 — Other 398 699 Deferred income tax assets 27,929 16,147 Valuation allowance (4,067) (3,999) Net deferred income tax assets 23,862 12,148 Deferred income tax liabilities Property and equipment (6,485) (7,597) Goodwill (10,652) (9,302) Intangible assets (14,311) (16,459) Right-of-use asset (11,891) — Other (27) (8) Deferred income tax liabilities (43,366) (33,366) Net deferred income taxes $ (19,504) $ (21,218) |
Schedule of Changes in Company's Gross Unrecognized Tax Benefits, Excluding Interest and Penalties | The following table summarizes the changes in the Company’s gross unrecognized tax benefits, excluding interest and penalties: For the year ended December 31, 2019 2018 Balance at beginning of period $ 723 $ 156 Additions for tax positions related to the current fiscal period — 1 Additions for tax positions related to prior years 217 341 Decreases for tax positions related to prior years — (2) Current year acquisitions — 270 Impact of foreign exchange fluctuation 13 — Settlements (465) (4) Reductions related to the expiration of statutes of limitations (95) (39) Balance at end of period $ 393 $ 723 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of Supplemental Balance Sheet Information | The Company’s Consolidated Balance Sheets include the following related to operating leases as of December 31, 2019: Leases Classification 2019 Assets: ROU assets Other Assets $ 45,817 Liabilities: ROU liability - current Accrued and other current liabilities $ 10,133 ROU liability - long-term Other liabilities 36,750 Total ROU liabilities $ 46,883 |
Schedule of Components of Lease Costs and Other Information Related to Leases | The components of lease costs for the year ended December 31, 2019 is as follows: Classification 2019 Finance lease expense: Amortization of ROU assets Depreciation and amortization $ 5,091 Interest on lease liabilities Interest expense 824 Operating lease expense Cost of revenue; Selling, general & administrative expenses 12,937 Short-term lease expense Cost of revenue; Selling, general & administrative expenses 43 Variable lease expense Cost of revenue; Selling, general & administrative expenses 1,220 Total $ 20,115 Additional information related to leases as of December 31, 2019 is as follows: 2019 Cash paid for amounts included in the measurement of lease liabilities for finance leases: Finance - financing cash flows $ 4,545 Finance - operating cash flows 824 Operating - operating cash flows 12,773 ROU assets obtained in the exchange for lease liabilities: Finance leases $ 9,502 Operating leases 18,965 Weighted-average remaining lease term (in years): Finance leases 5.9 Operating leases 6.2 Weighted-average discount rate: Finance leases 5.8 % Operating leases 5.9 % |
Schedule of Maturities of Operating Lease Liabilities | Maturities of lease liabilities as of December 31, 2019 is as follows: Finance Operating 2020 $ 6,241 $ 12,466 2021 4,255 10,347 2022 3,381 8,193 2023 2,489 6,790 2024 1,607 5,224 Thereafter 891 13,265 Total 18,864 56,285 Less: Present value discount 1,690 9,402 Lease liability $ 17,174 $ 46,883 |
Schedule of Maturities of Finance Lease Liabilities | Maturities of lease liabilities as of December 31, 2019 is as follows: Finance Operating 2020 $ 6,241 $ 12,466 2021 4,255 10,347 2022 3,381 8,193 2023 2,489 6,790 2024 1,607 5,224 Thereafter 891 13,265 Total 18,864 56,285 Less: Present value discount 1,690 9,402 Lease liability $ 17,174 $ 46,883 |
Schedule of Future Minimum Lease Payments Under Noncancelable Operating Leases | As previously disclosed in its 2018 Annual Report, the following table presents the Company’s future minimum operating lease commitments as of December 31, 2018: 2019 $ 10,939 2020 8,764 2021 6,327 2022 4,826 2023 4,239 Thereafter 10,667 Total $ 45,762 |
Segment Disclosure (Tables)
Segment Disclosure (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Financial Information by Segment | Selected financial information by segment for the periods shown was as follows (intercompany transactions are eliminated in Corporate and eliminations): For the year ended December 31, 2019 2018 2017 Revenues Services $ 595,130 $ 574,619 $ 543,565 International 144,271 153,448 144,265 Products and Systems 18,583 23,426 23,297 Corporate and eliminations (9,398) (9,139) (10,157) $ 748,586 $ 742,354 $ 700,970 For the year ended December 31, 2019 2018 2017 Gross profit Services $ 165,513 $ 151,974 $ 139,160 International 43,145 45,464 38,974 Products and Systems 8,639 10,560 9,798 Corporate and eliminations — (124) (220) $ 217,297 $ 207,874 $ 187,712 For the year ended December 31, 2019 2018 2017 Income from operations Services $ 49,593 $ 47,126 $ 46,677 International 5,856 3,953 3,537 Products and Systems (529) 2,368 (16,991) Corporate and eliminations (30,783) (31,226) (29,063) $ 24,137 $ 22,221 $ 4,160 For the year ended December 31, 2019 2018 2017 Depreciation and amortization Services $ 28,854 $ 24,079 $ 21,649 International 8,285 8,846 7,768 Products and Systems 1,213 1,429 2,180 Corporate and eliminations 181 59 (214) $ 38,533 $ 34,413 $ 31,383 December 31, 2019 2018 Intangible assets, net Services $ 98,284 $ 98,362 International 9,814 11,143 Products and Systems 1,181 1,438 Corporate and eliminations 258 452 $ 109,537 $ 111,395 December 31, 2019 2018 Total assets Services $ 537,518 $ 523,506 International 153,380 146,535 Products and Systems 16,028 12,264 Corporate and eliminations 12,952 11,732 $ 719,878 $ 694,037 |
Schedule of Revenue and Long-lived Assets by Geographic Area | December 31, 2019 2018 Long-lived assets United States $ 233,679 $ 230,140 Other Americas 181,550 177,628 Europe 75,325 76,781 $ 490,554 $ 484,549 December 31, 2017 Revenue United States $ 466,683 Other Americas 86,870 Europe 132,421 Asia-Pacific 14,996 $ 700,970 |
Selected Quarterly Financial _2
Selected Quarterly Financial Information (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Selected Quarterly Results of Operations | The following is a summary of the quarterly results of operations for calendar years 2019, 2018 and 2017. Quarter ended December 31, 2019 September 30, 2019 June 30, 2019 March 31, 2019 Revenues $ 178,991 $ 192,192 $ 200,616 $ 176,787 Gross Profit 50,583 57,769 60,071 48,874 Income (loss) from operations 2,335 10,779 15,419 (4,396) Net income (loss) attributable to Mistras Group, Inc. $ 829 $ 3,093 $ 7,431 $ (5,293) Earnings (loss) per common share: Basic $ 0.03 $ 0.11 $ 0.26 $ (0.19) Diluted $ 0.03 $ 0.11 $ 0.26 $ (0.19) Quarter ended December 31, 2018 September 30, 2018 June 30, 2018 March 31, 2018 Revenues $ 180,762 $ 182,169 $ 191,793 $ 187,630 Gross Profit 52,315 52,332 55,083 48,144 Income from operations 2,502 3,017 10,304 6,398 Net income (loss) attributable to Mistras Group, Inc. $ (1,061) $ (1,011) $ 6,000 $ 2,908 Earnings (loss) per common share: Basic $ (0.04) $ (0.04) $ 0.21 $ 0.10 Diluted $ (0.04) $ (0.04) $ 0.20 $ 0.10 Quarter ended December 31, 2017 September 30, 2017 June 30, 2017 March 31, 2017 Revenues $ 187,643 $ 179,570 $ 170,439 $ 163,318 Gross Profit 50,319 47,897 46,343 43,153 Income (loss) from operations 6,282 (10,375) 5,003 3,250 Net income (loss) attributable to Mistras Group, Inc. $ 884 $ (6,968) $ 2,217 $ 1,692 Earnings (loss) per common share: Basic $ 0.03 $ (0.25) $ 0.08 $ 0.06 Diluted $ 0.03 $ (0.25) $ 0.07 $ 0.06 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies and Practices (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | |
Concentration Risk [Line Items] | ||||
Foreign currency (gains) and losses | $ (500) | $ 1,300 | $ 600 | |
Minimum amount of excess self-insurance claims paid to reduce exposure | 300 | |||
Operating lease, right-to-use asset | 45,817 | |||
Lease liability | 46,883 | |||
ASC 842 | ||||
Concentration Risk [Line Items] | ||||
Operating lease, right-to-use asset | $ 38,000 | |||
Lease liability | $ 38,000 | |||
Selling, General and Administrative Expenses | ||||
Concentration Risk [Line Items] | ||||
Advertising expense | $ 2,100 | $ 2,100 | $ 1,900 | |
Software/Technology | ||||
Concentration Risk [Line Items] | ||||
Useful Life (Years) | 3 years | |||
Customer One | Customer concentration risk | Revenues | ||||
Concentration Risk [Line Items] | ||||
Percentage of concentration risk | 11.00% |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue recognized that was included in contract liability balance at the beginning of the year | $ 4.3 | $ 5.3 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue, remaining performance obligation, expected timing of satisfaction period | 1 year |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | $ 178,991 | $ 192,192 | $ 200,616 | $ 176,787 | $ 180,762 | $ 182,169 | $ 191,793 | $ 187,630 | $ 187,643 | $ 179,570 | $ 170,439 | $ 163,318 | $ 748,586 | $ 742,354 | $ 700,970 |
United States | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 495,132 | 487,414 | |||||||||||||
Other Americas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 111,740 | 98,248 | |||||||||||||
Europe | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 127,885 | 143,312 | |||||||||||||
Asia-Pacific | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 13,829 | 13,380 | |||||||||||||
Oil & Gas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 436,018 | 418,112 | |||||||||||||
Aerospace & Defense | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 93,851 | 107,708 | |||||||||||||
Industrials | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 89,214 | 89,900 | |||||||||||||
Power generation & Transmission | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 43,315 | 44,113 | |||||||||||||
Other Process Industries | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 39,109 | 36,046 | |||||||||||||
Infrastructure, Research & Engineering | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 33,105 | 25,561 | |||||||||||||
Other | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 13,974 | 20,914 | |||||||||||||
Operating segments | Services | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 595,130 | 574,619 | 543,565 | ||||||||||||
Operating segments | Services | United States | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 487,408 | 478,853 | |||||||||||||
Operating segments | Services | Other Americas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 104,081 | 90,823 | |||||||||||||
Operating segments | Services | Europe | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 2,342 | 4,252 | |||||||||||||
Operating segments | Services | Asia-Pacific | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 1,299 | 691 | |||||||||||||
Operating segments | Services | Oil & Gas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 390,815 | 378,904 | |||||||||||||
Operating segments | Services | Aerospace & Defense | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 51,390 | 50,500 | |||||||||||||
Operating segments | Services | Industrials | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 64,622 | 60,594 | |||||||||||||
Operating segments | Services | Power generation & Transmission | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 30,300 | 30,687 | |||||||||||||
Operating segments | Services | Other Process Industries | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 28,495 | 26,425 | |||||||||||||
Operating segments | Services | Infrastructure, Research & Engineering | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 14,269 | 11,283 | |||||||||||||
Operating segments | Services | Other | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 15,239 | 16,226 | |||||||||||||
Operating segments | International [Member] | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 144,271 | 153,448 | 144,265 | ||||||||||||
Operating segments | International [Member] | United States | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 631 | 568 | |||||||||||||
Operating segments | International [Member] | Other Americas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 7,659 | 7,995 | |||||||||||||
Operating segments | International [Member] | Europe | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 127,581 | 138,948 | |||||||||||||
Operating segments | International [Member] | Asia-Pacific | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 8,400 | 5,937 | |||||||||||||
Operating segments | International [Member] | Oil & Gas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 44,447 | 37,953 | |||||||||||||
Operating segments | International [Member] | Aerospace & Defense | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 41,224 | 54,853 | |||||||||||||
Operating segments | International [Member] | Industrials | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 21,405 | 26,209 | |||||||||||||
Operating segments | International [Member] | Power generation & Transmission | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 10,289 | 8,522 | |||||||||||||
Operating segments | International [Member] | Other Process Industries | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 10,196 | 9,497 | |||||||||||||
Operating segments | International [Member] | Infrastructure, Research & Engineering | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 9,520 | 9,032 | |||||||||||||
Operating segments | International [Member] | Other | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 7,190 | 7,382 | |||||||||||||
Operating segments | Products and Systems [Member] | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 18,583 | 23,426 | 23,297 | ||||||||||||
Operating segments | Products and Systems [Member] | United States | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 12,011 | 11,493 | |||||||||||||
Operating segments | Products and Systems [Member] | Other Americas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 407 | 1,068 | |||||||||||||
Operating segments | Products and Systems [Member] | Europe | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 1,940 | 3,958 | |||||||||||||
Operating segments | Products and Systems [Member] | Asia-Pacific | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 4,225 | 6,907 | |||||||||||||
Operating segments | Products and Systems [Member] | Oil & Gas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 756 | 1,255 | |||||||||||||
Operating segments | Products and Systems [Member] | Aerospace & Defense | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 1,237 | 2,355 | |||||||||||||
Operating segments | Products and Systems [Member] | Industrials | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 3,187 | 3,097 | |||||||||||||
Operating segments | Products and Systems [Member] | Power generation & Transmission | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 2,726 | 4,904 | |||||||||||||
Operating segments | Products and Systems [Member] | Other Process Industries | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 418 | 124 | |||||||||||||
Operating segments | Products and Systems [Member] | Infrastructure, Research & Engineering | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 9,316 | 5,246 | |||||||||||||
Operating segments | Products and Systems [Member] | Other | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 943 | 6,445 | |||||||||||||
Corporate and eliminations | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | (9,398) | (9,139) | $ (10,157) | ||||||||||||
Corporate and eliminations | United States | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | (4,918) | (3,500) | |||||||||||||
Corporate and eliminations | Other Americas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | (407) | (1,638) | |||||||||||||
Corporate and eliminations | Europe | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | (3,978) | (3,846) | |||||||||||||
Corporate and eliminations | Asia-Pacific | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | (95) | (155) | |||||||||||||
Corporate and eliminations | Oil & Gas | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 0 | 0 | |||||||||||||
Corporate and eliminations | Aerospace & Defense | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 0 | 0 | |||||||||||||
Corporate and eliminations | Industrials | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 0 | 0 | |||||||||||||
Corporate and eliminations | Power generation & Transmission | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 0 | 0 | |||||||||||||
Corporate and eliminations | Other Process Industries | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 0 | 0 | |||||||||||||
Corporate and eliminations | Infrastructure, Research & Engineering | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | 0 | 0 | |||||||||||||
Corporate and eliminations | Other | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Revenue | $ (9,398) | $ (9,139) |
Earnings per Share - Computatio
Earnings per Share - Computations of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic earnings (loss) per share: | |||||||||||||||
Net income (loss) attributable to Mistras Group, Inc. | $ 829 | $ 3,093 | $ 7,431 | $ (5,293) | $ (1,061) | $ (1,011) | $ 6,000 | $ 2,908 | $ 884 | $ (6,968) | $ 2,217 | $ 1,692 | $ 6,060 | $ 6,836 | $ (2,175) |
Denominator | |||||||||||||||
Weighted average common shares outstanding (in shares) | 28,740 | 28,406 | 28,422 | ||||||||||||
Basic earnings (loss) per share (in dollars per share) | $ 0.03 | $ 0.11 | $ 0.26 | $ (0.19) | $ (0.04) | $ (0.04) | $ 0.21 | $ 0.10 | $ 0.03 | $ (0.25) | $ 0.08 | $ 0.06 | $ 0.21 | $ 0.24 | $ (0.08) |
Denominator | |||||||||||||||
Weighted average common shares outstanding (in shares) | 28,740 | 28,406 | 28,422 | ||||||||||||
Dilutive effect of stock options outstanding (in shares) | 98 | 683 | 0 | ||||||||||||
Dilutive effect of restricted stock units outstanding (in shares) | 208 | 338 | 0 | ||||||||||||
Weighted average common shares outstanding, diluted (in shares) | 29,046 | 29,427 | 28,422 | ||||||||||||
Diluted earnings (loss) per share (in dollars per share) | $ 0.03 | $ 0.11 | $ 0.26 | $ (0.19) | $ (0.04) | $ (0.04) | $ 0.20 | $ 0.10 | $ 0.03 | $ (0.25) | $ 0.07 | $ 0.06 | $ 0.21 | $ 0.23 | $ (0.08) |
Earnings per Share - Potential
Earnings per Share - Potential Common Shares Excluded From Computation of Diluted Earnings (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potential common shares excluded from computation of diluted earnings per share (in shares) | 47 | 6 | 1,163 |
RSUs and PSUs | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potential common shares excluded from computation of diluted earnings per share (in shares) | 42 | 1 | 353 |
Potential common shares excluded from computation of diluted earnings per share due to net loss for the period (in shares) | 351 | ||
Stock Options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Potential common shares excluded from computation of diluted earnings per share (in shares) | 5 | 5 | 810 |
Potential common shares excluded from computation of diluted earnings per share due to net loss for the period (in shares) | 805 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Receivables [Abstract] | ||
Trade accounts receivable | $ 144,282 | $ 152,511 |
Allowance for doubtful accounts | (8,285) | (4,187) |
Accounts receivable, net | $ 135,997 | $ 148,324 |
Accounts Receivable - Narrative
Accounts Receivable - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2019 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Receivables [Abstract] | |||||||||
Unbilled revenues | $ 22,200,000 | $ 22,200,000 | $ 16,100,000 | $ 22,200,000 | $ 16,100,000 | ||||
Concentration Risk [Line Items] | |||||||||
Bad debt provision. net of (recoveries) | 3,038,000 | 650,000 | $ 1,200,000 | ||||||
Accounts receivable, net | 135,997,000 | 135,997,000 | 148,324,000 | 135,997,000 | $ 148,324,000 | ||||
Renewable Energy Industry Customer | Services | |||||||||
Concentration Risk [Line Items] | |||||||||
Bad debt provision. net of (recoveries) | 0 | $ 0 | $ (1,000,000) | $ 5,700,000 | $ 700,000 | ||||
Allowance for doubtful accounts recovery | $ 1,700,000 | 200,000 | |||||||
Texas Customer | |||||||||
Concentration Risk [Line Items] | |||||||||
Bad debt provision. net of (recoveries) | $ 1,400,000 | ||||||||
Accounts receivable, net | 1,400,000 | $ 1,400,000 | $ 1,400,000 | ||||||
Claim filed to recover past due receivables | $ 1,400,000 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 5,314 | $ 6,975 |
Work in progress | 1,549 | 1,019 |
Finished goods | 3,957 | 2,640 |
Consumable supplies | 2,593 | 2,419 |
Inventories | $ 13,413 | $ 13,053 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment, net | |||
Property, plant and equipment, gross | $ 270,410 | $ 251,433 | |
Accumulated depreciation and amortization | (171,803) | (157,538) | |
Property, plant and equipment, net | 98,607 | 93,895 | |
Depreciation expense | 24,200 | 24,200 | $ 22,400 |
Land | |||
Property, Plant and Equipment, net | |||
Property, plant and equipment, gross | 2,672 | 2,680 | |
Building and improvements | |||
Property, Plant and Equipment, net | |||
Property, plant and equipment, gross | $ 24,537 | 24,338 | |
Building and improvements | Minimum | |||
Property, Plant and Equipment, net | |||
Useful Life | 30 years | ||
Building and improvements | Maximum | |||
Property, Plant and Equipment, net | |||
Useful Life | 40 years | ||
Office furniture and equipment | |||
Property, Plant and Equipment, net | |||
Property, plant and equipment, gross | $ 17,227 | 16,170 | |
Office furniture and equipment | Minimum | |||
Property, Plant and Equipment, net | |||
Useful Life | 5 years | ||
Office furniture and equipment | Maximum | |||
Property, Plant and Equipment, net | |||
Useful Life | 8 years | ||
Machinery and equipment | |||
Property, Plant and Equipment, net | |||
Property, plant and equipment, gross | $ 225,974 | $ 208,245 | |
Machinery and equipment | Minimum | |||
Property, Plant and Equipment, net | |||
Useful Life | 5 years | ||
Machinery and equipment | Maximum | |||
Property, Plant and Equipment, net | |||
Useful Life | 7 years |
Acquisitions and Disposition -
Acquisitions and Disposition - Acquisitions Narrative (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)Entity | Dec. 31, 2018USD ($)Entity | |
Business Acquisition [Line Items] | ||
Period over which potential acquisition-related contingent consideration would be payable | 2 years 9 months 18 days | |
Acquiree That Provides Pipeline Integrity Management Software | ||
Business Acquisition [Line Items] | ||
Number of completed acquisitions | Entity | 1 | |
Cash consideration paid | $ 4,380 | |
Potential acquisition-related contingent consideration, high end of range | 4,300 | |
Revenue for the period subsequent to closing of the transaction | $ 2,000 | |
Period over which potential acquisition-related contingent consideration would be payable | 3 years | |
Aggregate income from operation for the period subsequent to closing of transaction | $ 400 | |
Fair value of intangibles | 3,594 | |
Fair value of property, plant and equipment | $ 65 | |
Minimum | ||
Business Acquisition [Line Items] | ||
Amortization period of intangible assets acquired | 1 year | |
Maximum | ||
Business Acquisition [Line Items] | ||
Amortization period of intangible assets acquired | 18 years | |
Canada and U.S. | ||
Business Acquisition [Line Items] | ||
Number of completed acquisitions | Entity | 1 | |
Cash consideration paid | $ 143,100 | |
Percentage of equity interest acquired | 100.00% | |
Fair value of intangibles | $ 59,600 | |
Adjustment to intangibles | $ 4,800 | |
Fair value of property, plant and equipment | 8,500 | |
Adjustment to property, plant and equipment | 700 | |
Fair value of debt and other liabilities | 5,000 | |
Adjustment to debt and other liabilities | 400 | |
Fair value of deferred tax liability | $ 12,700 | |
Adjustment to deferred tax liability | $ 1,400 |
Acquisitions and Disposition _2
Acquisitions and Disposition - Estimated Fair Value of the Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Estimated fair value of the assets acquired and liabilities assumed | |||
Goodwill | $ 282,410 | $ 279,259 | $ 203,438 |
Acquiree That Provides Pipeline Integrity Management Software | |||
Consideration transferred: | |||
Cash paid | 4,380 | ||
Working capital adjustments | (152) | ||
Fair value of contingent consideration | 1,142 | ||
Total consideration | 5,370 | ||
Estimated fair value of the assets acquired and liabilities assumed | |||
Current net assets | 142 | ||
Other assets | 34 | ||
Property, plant and equipment | 65 | ||
Intangibles | 3,594 | ||
Goodwill | 1,535 | ||
Net assets acquired | $ 5,370 |
Acquisitions and Disposition _3
Acquisitions and Disposition - Dispositions Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2018 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Gain on sale of subsidiary | $ 0 | $ 2,384 | $ 0 | |
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Disposal of Foreign Subsidiaries | Products and Systems | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Consideration received on sale of subsidiary | $ 4,300 | |||
Gain on sale of subsidiary | $ 2,400 | |||
Term of agreement to purchase products from buyer on sale of subsidiary | 3 years | 3 years | ||
Amount of purchase agreement with buyer on sale of subsidiary | $ 2,300 | $ 2,300 |
Acquisitions and Disposition _4
Acquisitions and Disposition - Acquisition-Related Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Business Combinations [Abstract] | |||
Due diligence, professional fees and other transaction costs | $ 364 | $ 1,248 | $ 945 |
Adjustments to fair value of contingent consideration liabilities | 511 | (716) | (463) |
Acquisition-related expense, net | $ 875 | $ 532 | $ 482 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Changes in the carrying amount of goodwill | ||
Balance at the beginning of the period | $ 279,259 | $ 203,438 |
Goodwill acquired during the year | 1,535 | 83,163 |
Adjustments to preliminary purchase price allocations | (2,332) | (1,977) |
Foreign currency translation | 3,948 | (5,365) |
Balance at the end of the period | 282,410 | 279,259 |
Services | ||
Changes in the carrying amount of goodwill | ||
Balance at the beginning of the period | 243,476 | 165,801 |
Goodwill acquired during the year | 1,535 | 83,163 |
Adjustments to preliminary purchase price allocations | (2,332) | (1,977) |
Foreign currency translation | 4,536 | (3,511) |
Balance at the end of the period | 247,215 | 243,476 |
International | ||
Changes in the carrying amount of goodwill | ||
Balance at the beginning of the period | 35,783 | 37,637 |
Goodwill acquired during the year | 0 | 0 |
Adjustments to preliminary purchase price allocations | 0 | 0 |
Foreign currency translation | (588) | (1,854) |
Balance at the end of the period | 35,195 | 35,783 |
Products and Systems | ||
Changes in the carrying amount of goodwill | ||
Balance at the beginning of the period | 0 | 0 |
Goodwill acquired during the year | 0 | 0 |
Adjustments to preliminary purchase price allocations | 0 | 0 |
Foreign currency translation | 0 | 0 |
Balance at the end of the period | $ 0 | $ 0 |
Goodwill - Narrative (Details)
Goodwill - Narrative (Details) - USD ($) | Oct. 01, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill | |||
Goodwill impairment charge | $ 0 | ||
Cumulative goodwill impairment | $ 23,100,000 | $ 23,100,000 | |
Products and Systems | |||
Goodwill | |||
Cumulative goodwill impairment | 13,200,000 | 13,200,000 | |
International | |||
Goodwill | |||
Cumulative goodwill impairment | $ 9,900,000 | $ 9,900,000 |
Intangible Assets - Gross Carry
Intangible Assets - Gross Carrying Amount and Accumulated Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 215,383 | $ 202,774 |
Accumulated Amortization | (105,846) | (91,379) |
Net Carrying Amount | 109,537 | 111,395 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 113,861 | 112,624 |
Accumulated Amortization | (67,853) | (60,993) |
Net Carrying Amount | $ 46,008 | 51,631 |
Customer relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 5 years | |
Customer relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 18 years | |
Software/Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 3 years | |
Gross Amount | $ 77,914 | 67,240 |
Accumulated Amortization | (18,756) | (13,319) |
Net Carrying Amount | $ 59,158 | 53,921 |
Software/Technology | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 3 years | |
Software/Technology | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 15 years | |
Covenants not to compete | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 12,795 | 12,593 |
Accumulated Amortization | (11,630) | (10,825) |
Net Carrying Amount | $ 1,165 | 1,768 |
Covenants not to compete | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 2 years | |
Covenants not to compete | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 5 years | |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 10,813 | 10,317 |
Accumulated Amortization | (7,607) | (6,242) |
Net Carrying Amount | $ 3,206 | $ 4,075 |
Other | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 2 years | |
Other | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (Years) | 12 years |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of expense of intangible assets | $ 14.3 | $ 10.2 | $ 9 |
Software/Technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of expense of intangible assets | $ 5.6 | $ 1.4 | $ 1.2 |
Intangible Assets - Expected Am
Intangible Assets - Expected Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2020 | $ 13,864 | |
2021 | 12,474 | |
2022 | 12,042 | |
2023 | 10,987 | |
2024 | 9,870 | |
Thereafter | 50,300 | |
Net Carrying Amount | $ 109,537 | $ 111,395 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Accrued salaries, wages and related employee benefits | $ 30,072 | $ 29,959 |
Contingent consideration | 2,614 | 1,687 |
Accrued workers' compensation and health benefits | 4,467 | 5,086 |
Deferred revenues | 5,860 | 5,046 |
Right-of-use liability - Operating | 10,133 | |
Pension accrual | 2,519 | 5,585 |
Other accrued expenses | 25,724 | 26,532 |
Total accrued expenses and other current liabilities | $ 81,389 | $ 73,895 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Total debt | $ 254,713 | $ 290,620 |
Less: Current portion | (6,593) | (6,833) |
Long-term debt, net of current portion | 248,120 | 283,787 |
Senior credit facility | ||
Debt Instrument [Line Items] | ||
Total debt | 151,773 | 181,656 |
Senior credit facility | Senior Secured Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt | 94,919 | 99,897 |
Debt issuance costs | 100 | |
Notes payable | ||
Debt Instrument [Line Items] | ||
Total debt | 0 | 68 |
Other | ||
Debt Instrument [Line Items] | ||
Total debt | $ 8,021 | $ 8,999 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) | Mar. 09, 2020USD ($)quarter | Dec. 31, 2019USD ($)quarter | Dec. 31, 2018USD ($) |
Long-Term Debt | |||
Other debt outstanding | $ 254,713,000 | $ 290,620,000 | |
Senior credit facility | |||
Long-Term Debt | |||
Maximum borrowing capacity | 300,000,000 | ||
Higher borrowing capacity option | 450,000,000 | ||
Maximum borrowing capacity in non-U.S. Dollar currencies | 100,000,000 | ||
Maximum amount available for the issuance of letters of credit | 20,000,000 | ||
Long-term Line of Credit | 246,700,000 | ||
Outstanding letters of credit | 3,700,000 | ||
Capitalized debt modification costs | 800,000 | ||
Non-recurring charges threshold used for calculation of funded debt leverage ratio | $ 10,000,000 | ||
Number of consecutive fiscal quarters used for calculating funded debt leverage ratio | quarter | 4 | ||
Funded debt leverage ratio at which the entity will bear the maximum interest rate margin | 3.25 | ||
Additional interest rate margin if funded debt leverage ratio exceeds threshold (as a percent) | 2.00% | ||
Preceding period used for calculating interest coverage ratio | 12 months | ||
Number of quarters for temporarily increase in funded debt leverage ratio following business acquisitions | quarter | 4 | ||
Other debt outstanding | $ 151,773,000 | 181,656,000 | |
Senior credit facility | Subsequent Event | |||
Long-Term Debt | |||
Number of quarters for temporarily increase in funded debt leverage ratio following business acquisitions | quarter | 2 | ||
Minimum credit exposure percentage | 0.6666 | ||
Aggregate consideration for all acquisitions | $ 5,000,000 | ||
Senior credit facility | Minimum | |||
Long-Term Debt | |||
Funded debt leverage ratio for additional interest payment | 3.50 | ||
Interest coverage ratio | 1.25 | ||
Funded debt leverage ratio temporarily increase due to business acquisitions | 3.5 | ||
Senior credit facility | Maximum | |||
Long-Term Debt | |||
Funded debt leverage ratio at which the entity will have the benefit of lowest interest margin | 1 | ||
Funded debt leverage ratio for additional interest payment | 4.25 | ||
Funded debt leverage ratio temporarily increase due to business acquisitions | 4 | ||
Senior credit facility | Maximum | Subsequent Event | |||
Long-Term Debt | |||
Funded debt leverage ratio temporarily increase due to business acquisitions | 3 | ||
Senior credit facility | Maximum | Subsequent Event | For quarters ended December 31, 2019 through June 30, 2020 | |||
Long-Term Debt | |||
Funded debt leverage ratio temporarily increase due to business acquisitions | 4 | ||
Senior credit facility | Maximum | Subsequent Event | For quarter ending September 30, 2020 | |||
Long-Term Debt | |||
Funded debt leverage ratio temporarily increase due to business acquisitions | 3.75 | ||
Senior credit facility | Maximum | Subsequent Event | For quarter ending December 31, 2020 and or each quarter end thereafter | |||
Long-Term Debt | |||
Funded debt leverage ratio temporarily increase due to business acquisitions | 3.5 | ||
Senior credit facility | LIBOR | Minimum | |||
Long-Term Debt | |||
Margin rate (as a percent) | 1.00% | ||
Senior credit facility | LIBOR | Maximum | |||
Long-Term Debt | |||
Margin rate (as a percent) | 2.00% | ||
Senior credit facility | LIBOR | Maximum | Subsequent Event | |||
Long-Term Debt | |||
Margin rate (as a percent) | 2.25% | ||
Senior credit facility | Base rate | Minimum | |||
Long-Term Debt | |||
Margin rate (as a percent) | (1.25%) | ||
Senior credit facility | Base rate | Maximum | |||
Long-Term Debt | |||
Margin rate (as a percent) | (0.375%) | ||
Senior credit facility | Term A Loan Facility | |||
Long-Term Debt | |||
Maximum borrowing capacity | $ 100,000,000 | ||
Other debt outstanding | 94,919,000 | 99,897,000 | |
Other | |||
Long-Term Debt | |||
Other debt outstanding | 8,021,000 | $ 8,999,000 | |
Other | Minimum | |||
Long-Term Debt | |||
Monthly debt payments | $ 1,000 | ||
Interest rate, minimum (as a percent) | 0.40% | ||
Other | Maximum | |||
Long-Term Debt | |||
Monthly debt payments | $ 18,000 | ||
Interest rate, minimum (as a percent) | 6.20% |
Long-Term Debt - Scheduled Prin
Long-Term Debt - Scheduled Principal Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
2020 | $ 6,593 | |
2021 | 8,864 | |
2022 | 11,210 | |
2023 | 225,343 | |
2024 | 890 | |
Thereafter | 1,813 | |
Total debt | $ 254,713 | $ 290,620 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Contingent Consideration Liability [Roll Forward] | |||
Revaluation | $ 511 | $ (716) | $ (463) |
Level 3 | |||
Contingent Consideration Liability [Roll Forward] | |||
Contingent consideration, beginning balance | 2,365 | 5,508 | |
Acquisitions | 1,142 | 0 | |
Payments | (852) | (2,277) | |
Accretion of liability | 92 | 175 | |
Revaluation | 419 | (891) | |
Foreign currency translation | 50 | (150) | |
Contingent consideration, ending balance | $ 3,216 | $ 2,365 | $ 5,508 |
Share-Based Compensation - Long
Share-Based Compensation - Long-term Incentive Plans (Details) | 12 Months Ended | |||
Dec. 31, 2019planshares | Dec. 31, 2018shares | Dec. 31, 2017shares | Dec. 31, 2016shares | |
Share-based compensation | ||||
Number of employee stock ownership plans | plan | 2 | |||
Stock options outstanding (in shares) | 5,000 | 2,105,000 | 2,130,000 | 2,167,000 |
2007 Plan and 2009 Plan | ||||
Share-based compensation | ||||
Number of awards authorized for grants (in shares) | 0 | |||
2016 Plan | ||||
Share-based compensation | ||||
Number of awards authorized for grants (in shares) | 1,700,000 | |||
Number of awards available for future grants (in shares) | 718,000 | |||
Stock options outstanding (in shares) | 5,000 | |||
Unvested restricted stock units outstanding (in shares) | 101,000 |
Share-Based Compensation - Stoc
Share-Based Compensation - Stock Options Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based compensation | |||
Stock options granted (in shares) | 0 | 0 | 0 |
Unrecognized compensation costs related to stock options | $ 0 | ||
Stock Options | |||
Share-based compensation | |||
Recognized share-based compensation expense | $ 0 | $ 0 | $ 0 |
Share-Based Compensation - Cash
Share-Based Compensation - Cash Proceeds and Intrinsic Value of Stock Options Exercised (Details) - USD ($) $ in Thousands, shares in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Payment Arrangement [Abstract] | |||
Cash proceeds from options exercised | $ 32 | $ 273 | $ 275 |
Aggregate intrinsic value of options exercised | $ 4,530 | $ 277 | $ 580 |
Options exercised, net (in shares) | 2.1 |
Share-Based Compensation - St_2
Share-Based Compensation - Stock Option Activity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Common Stock Options (shares) | |||
Outstanding at beginning of year: (in shares) | 2,105,000 | 2,130,000 | 2,167,000 |
Granted (in shares) | 0 | 0 | 0 |
Exercised (in shares) | (2,093,000) | (25,000) | (37,000) |
Expired or forfeited (in shares) | (7,000) | 0 | 0 |
Outstanding at end of year: (in shares) | 5,000 | 2,105,000 | 2,130,000 |
Weighted Average Exercise Price (in dollar per share) | |||
Outstanding at beginning of year: (in dollars per share) | $ 13.47 | $ 13.43 | $ 13.33 |
Granted (in dollars per share) | 0 | 0 | 0 |
Exercised (in dollars per share) | 13.45 | 10.75 | 7.39 |
Expired or forfeited (in dollars per share) | 10 | 0 | 0 |
Outstanding at end of year: (in dollars per share) | $ 22.35 | $ 13.47 | $ 13.43 |
Share-Based Compensation - St_3
Share-Based Compensation - Stock Options Outstanding and Exercisable (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | |
Aggregate Intrinsic Value | |
Options Outstanding (in dollars) | $ | $ 0 |
Options Exercisable (in dollars) | $ | $ 0 |
$22.35 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Prices, Lower Limit (in dollars per share) | $ 22.35 |
Range of Exercise Prices, Upper Limit (in dollars per share) | $ 22.35 |
Options Outstanding | |
Total Options Outstanding (in shares) | shares | 5 |
Weighted Average Remaining Life (Years) | 2 years 2 months 12 days |
Weighted Average Exercise Price (in dollars per share) | $ 22.35 |
Options Exercisable | |
Number Exercisable (in shares) | shares | 5 |
Weighted Average Exercise Price (in dollars per share) | $ 22.35 |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Stock Units Awards Narrative (Details) - Restricted Stock Units - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based compensation | |||
Recognized share-based compensation expense | $ 4 | $ 4.2 | $ 4.5 |
Unrecognized compensation cost, net of estimated forfeitures, related to restricted stock unit awards | $ 6.7 | ||
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years 4 months 24 days |
Share-Based Compensation - Vest
Share-Based Compensation - Vesting Activity of Restricted Stock Unit Awards (Details) - Restricted Stock Units - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based compensation | |||
Restricted stock awards vested | 172 | 258 | 185 |
Fair value of awards vested | $ 2,495 | $ 5,319 | $ 3,429 |
Share-Based Compensation - Comm
Share-Based Compensation - Common Stock Issued to Non-employee Directors (Details) - Non-employee directors - Common Stock shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($)directorshares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($)shares | |
Share-based compensation | |||
Number of non-employee directors to whom fully vested common stock is granted | director | 6 | ||
Awards issued (in shares) | shares | 30 | 19 | 21 |
Grant date fair value of awards issued (in dollars per share) | $ | $ 450 | $ 400 | $ 438 |
Share-Based Compensation - Re_2
Share-Based Compensation - Restricted Stock Unit Awards Outstanding (Details) - Restricted Stock Units - $ / shares shares in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Outstanding at beginning of period: (in shares) | 443 | 532 | 569 | |
Granted (in shares) | 339 | 211 | 183 | |
Released (in shares) | (172) | (258) | (185) | |
Forfeited (in shares) | (51) | (42) | (35) | |
Outstanding at end of period: (in shares) | 559 | 443 | 532 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Outstanding at beginning of period: (in dollars per share) | $ 16.92 | $ 20.55 | $ 21.05 | $ 20.81 |
Granted (in dollars per share) | 14.04 | 19.20 | 21.26 | |
Released (in dollars per share) | 20.38 | 20.48 | 20.49 | |
Forfeited (in dollars per share) | 17.71 | 20.52 | 21.45 | |
Outstanding at end of period: (in dollars per share) | $ 16.92 | $ 20.55 | $ 21.05 | $ 20.81 |
Share-Based Compensation - Perf
Share-Based Compensation - Performance Restricted Stock Units Narrative (Details) - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
PRSUs | ||||||
Share-based compensation | ||||||
Number of restricted stocks units granted (in shares) | 190 | 129 | 128 | |||
Unvested restricted stock units outstanding (in shares) | 260 | 277 | 278 | 290 | ||
PRSUs | Executive and senior officers | ||||||
Share-based compensation | ||||||
Unvested restricted stock units outstanding (in shares) | 260 | |||||
Recognized share-based compensation expense | $ 1.3 | $ 1.5 | $ 1.7 | |||
Unrecognized compensation cost, net of estimated forfeitures, related to restricted stock unit awards | $ 1.7 | |||||
Weighted-average period over which unrecognized compensation cost is expected to be recognized | 2 years | |||||
Income tax benefit recognized on share-based compensation | $ 2.1 | 1 | $ 2.2 | |||
PRSUs | Fiscal 2019 Grants | Executive and senior officers | ||||||
Share-based compensation | ||||||
Increase (reduction) in number of shares authorized for grant (in shares) | (103) | |||||
Unvested restricted stock units outstanding (in shares) | 29 | |||||
Aggregate liability related to performance shares outstanding | $ 0.1 | |||||
PRSUs | Fiscal 2018 Grants | ||||||
Share-based compensation | ||||||
Increase (reduction) in number of shares authorized for grant (in shares) | (3) | |||||
PRSUs | Fiscal 2018 Grants | Accrued Expenses and Other Current Liabilities | ||||||
Share-based compensation | ||||||
Aggregate liability related to performance shares outstanding | $ 0.1 | |||||
PRSUs | Fiscal 2018 Grants | Executive and senior officers | ||||||
Share-based compensation | ||||||
Number of restricted stocks units granted (in shares) | 129 | |||||
Increase (reduction) in number of shares authorized for grant (in shares) | (54) | |||||
Unvested restricted stock units outstanding (in shares) | 22 | |||||
PRSUs | Fiscal 2017 Grants | Executive and senior officers | ||||||
Share-based compensation | ||||||
Number of restricted stocks units granted (in shares) | 128 | |||||
Increase (reduction) in number of shares authorized for grant (in shares) | 4 | (65) | ||||
PRSUs with three years performance condition | Executive and senior officers | ||||||
Share-based compensation | ||||||
Payout performance period | 1 year | |||||
Vesting period | 4 years | |||||
Requisite service period | 5 years |
Share-Based Compensation - Pe_2
Share-Based Compensation - Performance Restricted Stock Units Activity (Details) - PRSUs - $ / shares shares in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Outstanding at beginning of period: (in shares) | 277 | 278 | 290 | |
Granted (in shares) | 190 | 129 | 128 | |
Performance condition adjustments, net (in shares) | (106) | (50) | (68) | |
Released (in shares) | (101) | (68) | (72) | |
Forfeited (in shares) | 0 | (12) | 0 | |
Outstanding at end of period: (in shares) | 260 | 277 | 278 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||
Outstanding at beginning of period: (in dollars per share) | $ 16.77 | $ 17.80 | $ 17 | $ 16.01 |
Granted (in dollars per share) | 13.63 | 19.46 | 20.42 | |
Performance condition adjustments, net (in dollars per share) | 13.77 | 19.48 | 20.55 | |
Released (in dollars per share) | 17.19 | 16.03 | 15.82 | |
Forfeited (in dollars per share) | 0 | 16.16 | 0 | |
Outstanding at end of period: (in dollars per share) | $ 16.77 | $ 17.80 | $ 17 | $ 16.01 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income (loss) before provision for income taxes from: | |||
U.S. operations | $ 7,334 | $ 9,853 | $ (7,303) |
Foreign operations | 3,105 | 4,418 | 7,077 |
Income (loss) before provision for income taxes | 10,439 | 14,271 | (226) |
Current | |||
Federal | 2,712 | 790 | 3,558 |
States and local | 519 | 533 | 39 |
Foreign | 4,572 | 3,824 | 3,131 |
Reserve for uncertain tax positions | 99 | 337 | 71 |
Total current | 7,902 | 5,484 | 6,799 |
Deferred | |||
Federal | 315 | 2,966 | (3,857) |
States and local | (32) | 399 | (810) |
Foreign | (4,095) | (2,089) | (159) |
Total deferred | (3,812) | 1,276 | (4,826) |
Net change in valuation allowance | 269 | 666 | (31) |
Net deferred | (3,543) | 1,942 | (4,857) |
Provision for income taxes | $ 4,359 | $ 7,426 | $ 1,942 |
Income Taxes - Tax Rate Reconci
Income Taxes - Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
Federal tax at statutory rate | $ 2,192 | $ 2,997 | $ (79) |
State taxes, net of federal benefit | 377 | 737 | (502) |
Foreign tax | 982 | 807 | 217 |
Contingent consideration | 29 | (6) | (63) |
Nondeductible compensation | 1,581 | 183 | 0 |
US taxation of foreign earnings | 464 | 228 | 0 |
Permanent differences | 213 | 361 | 377 |
Transition tax, net of foreign tax credits | 0 | 1,158 | 3,942 |
Federal tax rate change due to the Tax Act | 0 | 87 | (1,956) |
Other | 134 | 208 | 37 |
Change in valuation allowance | 269 | 666 | (31) |
Impact of foreign tax rate changes | (1,882) | 0 | 0 |
Provision for income taxes | $ 4,359 | $ 7,426 | $ 1,942 |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
Federal tax at statutory rate | 21.00% | 21.00% | 35.00% |
State taxes, net of federal benefit | 3.60% | 5.10% | 221.60% |
Foreign tax | 9.40% | 5.70% | (95.80%) |
Contingent consideration | 0.30% | 0.00% | 27.70% |
Nondeductible compensation | 15.20% | 1.30% | 0.00% |
US taxation of foreign earnings | 4.40% | 1.60% | 0.00% |
Permanent differences | 2.00% | 2.50% | (166.40%) |
Transition tax, net of foreign tax credits | 0.00% | 8.10% | (1741.40%) |
Federal tax rate change due to the Tax Act | 0 | 0.006 | 8.640 |
Other | 1.30% | 1.40% | (16.30%) |
Change in valuation allowance | 2.60% | 4.70% | 13.70% |
Impact of foreign tax rate changes | (18.00%) | 0.00% | 0.00% |
Provision for income taxes | 41.80% | 52.00% | (857.90%) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 3 Months Ended | 7 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Income tax expense related to Tax Act | $ 1,900,000 | |||||||||||||||
Provisional one-time benefit as result of re-measurement of deferred tax assets and liabilities | 2,300,000 | |||||||||||||||
Provisional one-time expense due to imposition of transition tax | 3,900,000 | |||||||||||||||
Provisional tax expense attributable to reduction in deferred tax assets | 300,000 | |||||||||||||||
Complete accounting, income tax expense for effects of Tax Act | $ 1,700,000 | |||||||||||||||
Complete accounting, tax expense due to increase of net deferred tax liabilities | 100,000 | |||||||||||||||
Complete accounting, tax expense due to transition tax | 1,300,000 | |||||||||||||||
Tax expense due to changes made to executive compensation rules pursuant Tax Act | 400,000 | |||||||||||||||
Deferred tax assets valuation allowance | $ 4,067,000 | $ 3,999,000 | $ 4,067,000 | 3,999,000 | ||||||||||||
Unrecognized tax benefits | 393,000 | 723,000 | $ 156,000 | 393,000 | 723,000 | 156,000 | ||||||||||
Unrecognized tax benefits that would favorably affect the effective tax rate, if recognized | 100,000 | 100,000 | 100,000 | 100,000 | ||||||||||||
Expected decrease in unrecognized tax benefits (less than) | 100,000 | 100,000 | ||||||||||||||
Net income (loss) of foreign subsidiaries | 829,000 | $ 3,093,000 | $ 7,431,000 | $ (5,293,000) | (1,061,000) | $ (1,011,000) | $ 6,000,000 | $ 2,908,000 | $ 884,000 | $ (6,968,000) | $ 2,217,000 | $ 1,692,000 | 6,060,000 | 6,836,000 | $ (2,175,000) | |
Recognized a deferred tax liability on undistributed international earnings (losses) of foreign subsidiaries | 0 | 0 | ||||||||||||||
Unrecorded deferred tax liability related to undistributed international earnings | 1,100,000 | 1,100,000 | ||||||||||||||
Federal | Internal Revenue Service (IRS) | ||||||||||||||||
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Net operating losses | 200,000 | 200,000 | ||||||||||||||
State | ||||||||||||||||
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Net operating losses | 7,200,000 | 7,200,000 | ||||||||||||||
Foreign | ||||||||||||||||
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Net operating losses | 12,300,000 | 12,300,000 | ||||||||||||||
Net income (loss) of foreign subsidiaries | $ 4,100,000 | 2,500,000 | 2,000,000 | |||||||||||||
Foreign | Expiration Period 2025-2038 | ||||||||||||||||
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Net operating losses | 600,000 | 600,000 | ||||||||||||||
Foreign | Canadian Province of Alberta | ||||||||||||||||
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Favorable impact in tax rate from revaluation of net assets and liabilities due to enactment of foreign Job Creation Tax Cut | 1,900,000 | |||||||||||||||
State and Foreign | ||||||||||||||||
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Increase in deferred tax assets valuation allowance | 100,000 | |||||||||||||||
State and Foreign | Disposal Group, Held-for-sale or Disposed of by Sale, Not Discontinued Operations | Disposal of Foreign Subsidiaries | ||||||||||||||||
Operating Loss Carryforwards [Line Items] | ||||||||||||||||
Deferred tax assets valuation allowance | $ 4,100,000 | $ 4,000,000 | $ 4,100,000 | $ 4,000,000 |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred income tax assets | ||
Allowance for doubtful accounts | $ 1,186 | $ 951 |
Inventory | 359 | 285 |
Intangible assets | 1,795 | 1,230 |
Accrued expenses | 4,421 | 4,408 |
Net operating loss carryforward | 3,832 | 3,653 |
Finance lease obligations | 1,067 | 731 |
Capital losses | 463 | 462 |
Deferred share-based compensation | 1,145 | 3,728 |
Interest carryforward | 1,372 | 0 |
Right-of-use liability | 11,891 | |
Other | 398 | 699 |
Deferred income tax assets | 27,929 | 16,147 |
Valuation allowance | (4,067) | (3,999) |
Net deferred income tax assets | 23,862 | 12,148 |
Deferred income tax liabilities | ||
Property and equipment | (6,485) | (7,597) |
Goodwill | (10,652) | (9,302) |
Intangible assets | (14,311) | (16,459) |
Right-of-use asset | (11,891) | |
Other | (27) | (8) |
Deferred income tax liabilities | (43,366) | (33,366) |
Net deferred income taxes | $ (19,504) | $ (21,218) |
Income Taxes - Changes in Unrec
Income Taxes - Changes in Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Balance at beginning of period | $ 723 | $ 156 |
Additions for tax positions related to the current fiscal period | 0 | 1 |
Additions for tax positions related to prior years | 217 | 341 |
Decreases for tax positions related to prior years | 0 | (2) |
Current year acquisitions | 0 | 270 |
Impact of foreign exchange fluctuation | 13 | 0 |
Settlements | (465) | (4) |
Reductions related to the expiration of statutes of limitations | (95) | (39) |
Balance at end of period | $ 393 | $ 723 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
401(k) savings plan | |||
Minimum age for employees to contribute catch up contributions under IRS limits | 50 years | ||
Continuous service period required for eligibility of employees to participate under the plan | 3 months | ||
Maximum Company match amount of employee contributions matched up to 6% of annual compensation (as a percent) | 50.00% | ||
Maximum percentage of employee's annual compensation for which the company contributes a matching contribution (as a percent) | 6.00% | ||
Vesting period for employer matching contribution | 5 years | ||
Contribution under 401(k) savings plan | $ 4,100,000 | $ 3,900,000 | $ 3,700,000 |
Multiemployer Plans, Pension | Boilermakers and Pipefitters Plans | |||
Multiemployer Defined Benefit Pension Plans | |||
Multiemployer plan funded status | Between 65 and less than 80 percent | ||
Multiemployer plan, amount of Company's contributions | $ 0 | $ 600,000 | $ 2,400,000 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($)director | |
Shareholder and officer | |
Related Party Transactions | |
Total rent payments | $ | $ 1 |
Non-employee directors | Capital Management Enterprise (“CME”) | Consulting Services | |
Related Party Transactions | |
Number of non-employee director | director | 1 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Assets: | |
ROU assets | $ 45,817 |
Liabilities: | |
ROU liability - current | 10,133 |
ROU liability - long-term | 36,750 |
Total ROU liabilities | $ 46,883 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Lessee, Lease, Description [Line Items] | |
ROU operating lease liabilities | $ 46,883 |
Operating rental payments | 12,773 |
Operating Lease Arrangement | |
Lessee, Lease, Description [Line Items] | |
ROU operating lease liabilities | 4,500 |
Operating rental payments | 1,000 |
ROU finance lease assets | $ 19,200 |
Leases - Components of Lease Co
Leases - Components of Lease Costs (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Finance lease expense: | |
Amortization of ROU assets | $ 5,091 |
Interest on lease liabilities | 824 |
Operating lease expense | 12,937 |
Short-term lease expense | 43 |
Variable lease expense | 1,220 |
Total | $ 20,115 |
Leases - Other Information Rela
Leases - Other Information Related to Leases (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities for finance leases: | |
Finance - financing cash flows | $ 4,545 |
Finance - operating cash flows | 824 |
Operating - operating cash flows | 12,773 |
ROU assets obtained in the exchange for lease liabilities: | |
Finance leases | 9,502 |
Operating leases | $ 18,965 |
Weighted-average remaining lease term (in years): | |
Finance leases | 5 years 10 months 24 days |
Operating leases | 6 years 2 months 12 days |
Weighted-average discount rate: | |
Finance leases | 5.80% |
Operating leases | 5.90% |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liabilities (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Finance | |
2020 | $ 6,241 |
2021 | 4,255 |
2022 | 3,381 |
2023 | 2,489 |
2024 | 1,607 |
Thereafter | 891 |
Total | 18,864 |
Less: Present value discount | 1,690 |
Lease liability | 17,174 |
Operating | |
2020 | 12,466 |
2021 | 10,347 |
2022 | 8,193 |
2023 | 6,790 |
2024 | 5,224 |
Thereafter | 13,265 |
Total | 56,285 |
Less: Present value discount | 9,402 |
Lease liability | $ 46,883 |
Leases - Future Minimum Operati
Leases - Future Minimum Operating Lease Commitments Under Previous Accounting Guidance (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 10,939 |
2020 | 8,764 |
2021 | 6,327 |
2022 | 4,826 |
2023 | 4,239 |
Thereafter | 10,667 |
Total | $ 45,762 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 1 Months Ended | 12 Months Ended | |||||
Dec. 31, 2019USD ($)Entitywelds | Sep. 30, 2019USD ($) | Apr. 30, 2017 | Dec. 31, 2019USD ($)Entityclaimwelds | Dec. 31, 2018USD ($) | Jan. 01, 2020USD ($) | Sep. 30, 2018USD ($) | |
Litigation | |||||||
Accounts receivable, net | $ 135,997,000 | $ 135,997,000 | $ 148,324,000 | ||||
Pension accrual | 2,519,000 | $ 2,519,000 | $ 5,585,000 | ||||
Period over which potential acquisition-related contingent consideration would be payable | 2 years 9 months 18 days | ||||||
Texas Customer | |||||||
Litigation | |||||||
Accounts receivable, net | 1,400,000 | $ 1,400,000 | |||||
Verbal demand for damages | 1,400,000 | ||||||
Right to Customer Contracts | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Subsequent Event | |||||||
Litigation | |||||||
Consideration received on sale of disposal | $ 100,000 | ||||||
Products and Systems | Disposal of Foreign Subsidiaries | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||
Litigation | |||||||
Consideration received on sale of disposal | $ 4,300,000 | ||||||
Term of agreement to purchase products from buyer on sale of subsidiary | 3 years | 3 years | |||||
Amount of purchase agreement with buyer on sale of subsidiary | $ 2,300,000 | $ 2,300,000 | |||||
Remaining amount of purchase agreement with buyer on sale of subsidiary | $ 1,400,000 | $ 1,400,000 | |||||
Various Pipeline Projects For Texas Customer | |||||||
Litigation | |||||||
Number of welds alleged not in compliance | welds | 66 | 66 | |||||
Number of welds inspected | welds | 16,000 | 16,000 | |||||
Verbal demand for damages | $ 7,600,000 | ||||||
Company vehicle accident | McAllister v. Mistras Group, Inc. | |||||||
Litigation | |||||||
Number of claims filed | claim | 1 | ||||||
Pending claims | Entity | 2 | 2 | |||||
Pension related contingencies | |||||||
Litigation | |||||||
Monthly payments, excluding settlement | $ 3,300,000 | ||||||
Charge for withdrawal liability | $ 900,000 | 800,000 | 5,900,000 | ||||
Acquisition-related contingencies | |||||||
Litigation | |||||||
Potential acquisition-related contingent consideration, low end of range | $ 0 | 0 | |||||
Potential acquisition-related contingent consideration, high end of range | $ 7,900,000 | 7,900,000 | |||||
Selling, General and Administrative Expenses | NDT Do Brazil, LTDA | Severance and labor disputes | |||||||
Litigation | |||||||
Contingency related charges | $ 1,200,000 | ||||||
GERMANY | Severance and labor disputes | French Subsidiary | |||||||
Litigation | |||||||
Period covered by temporary staff leasing contract | 18 months | ||||||
GERMANY | Selling, General and Administrative Expenses | Severance and labor disputes | French Subsidiary | |||||||
Litigation | |||||||
Contingency related charges | 800,000 | ||||||
Contingency payments | 200,000 | ||||||
Loss contingency reversals | $ 500,000 |
Segment Disclosure - Financial
Segment Disclosure - Financial Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2019USD ($)Operating_Segment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Segment Reporting [Abstract] | |||||||||||||||
Number of operating segments | Operating_Segment | 3 | ||||||||||||||
Financial information by segment | |||||||||||||||
Revenues | $ 178,991 | $ 192,192 | $ 200,616 | $ 176,787 | $ 180,762 | $ 182,169 | $ 191,793 | $ 187,630 | $ 187,643 | $ 179,570 | $ 170,439 | $ 163,318 | $ 748,586 | $ 742,354 | $ 700,970 |
Gross profit | 50,583 | 57,769 | 60,071 | 48,874 | 52,315 | 52,332 | 55,083 | 48,144 | 50,319 | 47,897 | 46,343 | 43,153 | 217,297 | 207,874 | 187,712 |
Operating Income (Loss) | 2,335 | $ 10,779 | $ 15,419 | $ (4,396) | 2,502 | $ 3,017 | $ 10,304 | $ 6,398 | $ 6,282 | $ (10,375) | $ 5,003 | $ 3,250 | 24,137 | 22,221 | 4,160 |
Depreciation and amortization | 38,533 | 34,413 | 31,383 | ||||||||||||
Intangible assets, net | 109,537 | 111,395 | 109,537 | 111,395 | |||||||||||
Total assets | 719,878 | 694,037 | 719,878 | 694,037 | |||||||||||
Operating segments | Services | |||||||||||||||
Financial information by segment | |||||||||||||||
Revenues | 595,130 | 574,619 | 543,565 | ||||||||||||
Gross profit | 165,513 | 151,974 | 139,160 | ||||||||||||
Operating Income (Loss) | 49,593 | 47,126 | 46,677 | ||||||||||||
Depreciation and amortization | 28,854 | 24,079 | 21,649 | ||||||||||||
Intangible assets, net | 98,284 | 98,362 | 98,284 | 98,362 | |||||||||||
Total assets | 537,518 | 523,506 | 537,518 | 523,506 | |||||||||||
Operating segments | International | |||||||||||||||
Financial information by segment | |||||||||||||||
Revenues | 144,271 | 153,448 | 144,265 | ||||||||||||
Gross profit | 43,145 | 45,464 | 38,974 | ||||||||||||
Operating Income (Loss) | 5,856 | 3,953 | 3,537 | ||||||||||||
Depreciation and amortization | 8,285 | 8,846 | 7,768 | ||||||||||||
Intangible assets, net | 9,814 | 11,143 | 9,814 | 11,143 | |||||||||||
Total assets | 153,380 | 146,535 | 153,380 | 146,535 | |||||||||||
Operating segments | Products and Systems | |||||||||||||||
Financial information by segment | |||||||||||||||
Revenues | 18,583 | 23,426 | 23,297 | ||||||||||||
Gross profit | 8,639 | 10,560 | 9,798 | ||||||||||||
Operating Income (Loss) | (529) | 2,368 | (16,991) | ||||||||||||
Depreciation and amortization | 1,213 | 1,429 | 2,180 | ||||||||||||
Intangible assets, net | 1,181 | 1,438 | 1,181 | 1,438 | |||||||||||
Total assets | 16,028 | 12,264 | 16,028 | 12,264 | |||||||||||
Corporate and eliminations | |||||||||||||||
Financial information by segment | |||||||||||||||
Revenues | (9,398) | (9,139) | (10,157) | ||||||||||||
Gross profit | 0 | (124) | (220) | ||||||||||||
Operating Income (Loss) | (30,783) | (31,226) | (29,063) | ||||||||||||
Depreciation and amortization | 181 | 59 | $ (214) | ||||||||||||
Intangible assets, net | 258 | 452 | 258 | 452 | |||||||||||
Total assets | $ 12,952 | $ 11,732 | $ 12,952 | $ 11,732 |
Segment Disclosure - Revenue an
Segment Disclosure - Revenue and Long-lived Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue and long-lived assets by geographic area | |||
Long-lived assets | $ 490,554 | $ 484,549 | |
Revenues | $ 700,970 | ||
United States | |||
Revenue and long-lived assets by geographic area | |||
Long-lived assets | 233,679 | 230,140 | |
Revenues | 466,683 | ||
Other Americas | |||
Revenue and long-lived assets by geographic area | |||
Long-lived assets | 181,550 | 177,628 | |
Revenues | 86,870 | ||
Europe | |||
Revenue and long-lived assets by geographic area | |||
Long-lived assets | $ 75,325 | $ 76,781 | |
Revenues | 132,421 | ||
Asia-Pacific | |||
Revenue and long-lived assets by geographic area | |||
Revenues | $ 14,996 |
Repurchase of Common Stock (Det
Repurchase of Common Stock (Details) - Stock Repurchase Plan - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Oct. 07, 2015 | |
Class of Stock [Line Items] | |||
Stock repurchase plan, amount approved | $ 50,000,000 | ||
Treasury stock repurchased (in shares) | 0 | 0 |
Selected Quarterly Financial _3
Selected Quarterly Financial Information (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||
Revenue | $ 178,991 | $ 192,192 | $ 200,616 | $ 176,787 | $ 180,762 | $ 182,169 | $ 191,793 | $ 187,630 | $ 187,643 | $ 179,570 | $ 170,439 | $ 163,318 | $ 748,586 | $ 742,354 | $ 700,970 |
Gross Profit | 50,583 | 57,769 | 60,071 | 48,874 | 52,315 | 52,332 | 55,083 | 48,144 | 50,319 | 47,897 | 46,343 | 43,153 | 217,297 | 207,874 | 187,712 |
Income (loss) from operations | 2,335 | 10,779 | 15,419 | (4,396) | 2,502 | 3,017 | 10,304 | 6,398 | 6,282 | (10,375) | 5,003 | 3,250 | 24,137 | 22,221 | 4,160 |
Net income (loss) attributable to Mistras Group, Inc. | $ 829 | $ 3,093 | $ 7,431 | $ (5,293) | $ (1,061) | $ (1,011) | $ 6,000 | $ 2,908 | $ 884 | $ (6,968) | $ 2,217 | $ 1,692 | $ 6,060 | $ 6,836 | $ (2,175) |
Earnings (loss) per common share: | |||||||||||||||
Basic (in dollars per share) | $ 0.03 | $ 0.11 | $ 0.26 | $ (0.19) | $ (0.04) | $ (0.04) | $ 0.21 | $ 0.10 | $ 0.03 | $ (0.25) | $ 0.08 | $ 0.06 | $ 0.21 | $ 0.24 | $ (0.08) |
Diluted (in dollars per share) | $ 0.03 | $ 0.11 | $ 0.26 | $ (0.19) | $ (0.04) | $ (0.04) | $ 0.20 | $ 0.10 | $ 0.03 | $ (0.25) | $ 0.07 | $ 0.06 | $ 0.21 | $ 0.23 | $ (0.08) |