Cover Page
Cover Page - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Mar. 01, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Interactive Data Current | Yes | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | MASTECH DIGITAL, INC. | ||
Entity Central Index Key | 0001437226 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Current Reporting Status | Yes | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | MHH | ||
Security Exchange Name | NYSE | ||
Entity Address, State or Province | PA | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 47,201,000 | ||
Entity Common Stock, Shares Outstanding | 11,526,705 | ||
ICFR Auditor Attestation Flag | false | ||
Auditor Name | UHY LLP | ||
Auditor Firm ID | 1195 | ||
Auditor Location | Farmington Hills, Michigan | ||
Entity File Number | 001-34099 | ||
Entity Incorporation, State or Country Code | PA | ||
Entity Address, Address Line One | 1305 Cherrington Parkway | ||
Entity Address, City or Town | Moon Township | ||
Entity Address, Postal Zip Code | 15108 | ||
Entity Tax Identification Number | 26-2753540 | ||
City Area Code | 412 | ||
Local Phone Number | 787-2100 | ||
Entity Address, Address Line Two | Building 210 | ||
Entity Address, Address Line Three | Suite 400 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 6,622 | $ 7,677 |
Accounts receivable, net of allowance for uncollectible accounts of $375 in 2021 and $413 in 2020 | 34,153 | 22,036 |
Unbilled receivables | 9,240 | 10,098 |
Prepaid and other current assets | 3,890 | 1,346 |
Total current assets | 53,905 | 41,157 |
Equipment, enterprise software, and leasehold improvements, at cost: | ||
Equipment | 2,356 | 1,931 |
Enterprise software | 3,753 | 2,730 |
Leasehold improvements | 842 | 563 |
Total equipment, enterprise software, and leasehold improvements | 6,951 | 5,224 |
Less – accumulated depreciation and amortization | (3,913) | (3,253) |
Net equipment, enterprise software, and leasehold improvements | 3,038 | 1,971 |
Operating lease right-of-use assets | 4,894 | 3,286 |
Deferred income taxes | 796 | |
Non-current deposits | 595 | 396 |
Goodwill, net of impairment | 32,510 | 32,510 |
Intangible assets, net of amortization | 18,760 | 21,930 |
Total assets | 113,702 | 102,046 |
Current liabilities: | ||
Current portion of long-term debt | 4,400 | 4,400 |
Accounts payable | 4,954 | 2,589 |
Accrued payroll and related costs | 14,240 | 12,374 |
Current portion of operating lease liability | 1,479 | 1,079 |
Other accrued liabilities | 1,227 | 1,051 |
Deferred revenue | 544 | 478 |
Total current liabilities | 26,844 | 21,971 |
Long-term liabilities: | ||
Long-term debt, less current portion, net | 8,334 | 12,875 |
Contingent consideration liability | 0 | 2,882 |
Long-term operating lease liability, less current portion | 3,706 | 2,325 |
Long-term accrued income taxes | 125 | 165 |
Deferred income taxes | 265 | |
Long-term payroll tax liabilities | 2,295 | |
Total liabilities | 39,274 | 42,513 |
Commitments and contingent liabilities (Note 9) | ||
Shareholders' equity: | ||
Preferred Stock, no par value; 20,000,000 shares authorized; none outstanding | ||
Common Stock, par value $.01; 250,000,000 shares authorized and 13,112,202 shares issued as of December 31, 2021 and 13,039,893 shares issued as of December 31, 2020 | 131 | 130 |
Additional paid-in-capital | 28,250 | 25,509 |
Retained earnings | 50,841 | 38,620 |
Accumulated other comprehensive income (loss) | (607) | (539) |
Treasury stock, at cost; 1,646,420 shares as of December 31, 2021 and as of December 31, 2020 | (4,187) | (4,187) |
Total shareholders' equity | 74,428 | 59,533 |
Total liabilities and shareholders' equity | $ 113,702 | $ 102,046 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for uncollectible accounts | $ 375 | $ 413 |
Preferred Stock, par value | $ 0 | $ 0 |
Preferred Stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred Stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 13,112,202 | 13,039,893 |
Treasury stock, shares | 1,646,420 | 1,646,420 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Statement [Abstract] | |||
Revenues | $ 222,012 | $ 194,101 | $ 193,574 |
Cost of revenues | 162,568 | 142,562 | 145,593 |
Gross profit | 59,444 | 51,539 | 47,981 |
Selling, general and administrative expenses: | |||
Operating expenses | 44,716 | 38,136 | 37,063 |
Revaluation of contingent consideration liability | (2,882) | (6,069) | |
Total selling, general and administrative expenses | 41,834 | 38,136 | 30,994 |
Income from operations | 17,610 | 13,403 | 16,987 |
Interest income (expense), net | (675) | (866) | (1,779) |
Other income (expense), net | (49) | 96 | 11 |
Income before income taxes | 16,886 | 12,633 | 15,219 |
Income tax expense | 4,665 | 2,772 | 4,074 |
Net income | $ 12,221 | $ 9,861 | $ 11,145 |
Earnings Per Share: | |||
Basic | $ 1.07 | $ 0.87 | $ 1.01 |
Diluted | $ 1.02 | $ 0.83 | $ 0.99 |
Weighted average common shares outstanding: | |||
Basic | 11,436 | 11,292 | 11,029 |
Diluted | 12,007 | 11,950 | 11,232 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Net income | $ 12,221 | $ 9,861 | $ 11,145 |
Other comprehensive income (loss): | |||
Net unrealized gain (loss) on interest rate swap contracts | 35 | 8 | (149) |
Foreign currency translation adjustments | (94) | (187) | (129) |
Total pretax net unrealized (loss) | (59) | (179) | (278) |
Income tax expense (benefit) | 9 | 2 | (39) |
Total other comprehensive (loss), net of taxes | (68) | (181) | (239) |
Total comprehensive income | $ 12,153 | $ 9,680 | $ 10,906 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Retained Earnings [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Income (loss) [Member] |
Beginning Balances at Dec. 31, 2018 | $ 34,276 | $ 126 | $ 20,829 | $ 17,614 | $ (4,174) | $ (119) |
Net income | 11,145 | 11,145 | ||||
Employee common stock purchases | 168 | 1 | 167 | |||
Other comprehensive (loss), net of taxes | (239) | (239) | ||||
Stock-based compensation expense | 936 | 936 | ||||
Stock options exercised | 7 | 7 | ||||
Purchase of treasury stock | (13) | (13) | ||||
Ending Balances at Dec. 31, 2019 | 46,280 | 127 | 21,939 | 28,759 | (4,187) | (358) |
Net income | 9,861 | 9,861 | ||||
Employee common stock purchases | 222 | 222 | ||||
Other comprehensive (loss), net of taxes | (181) | (181) | ||||
Stock-based compensation expense | 2,021 | 2,021 | ||||
Stock options exercised | 1,330 | 3 | 1,327 | |||
Ending Balances at Dec. 31, 2020 | 59,533 | 130 | 25,509 | 38,620 | (4,187) | (539) |
Net income | 12,221 | 12,221 | ||||
Employee common stock purchases | 301 | 0 | 301 | |||
Other comprehensive (loss), net of taxes | (68) | (68) | ||||
Stock-based compensation expense | 2,212 | 2,212 | ||||
Stock options exercised | 229 | 1 | 228 | |||
Ending Balances at Dec. 31, 2021 | $ 74,428 | $ 131 | $ 28,250 | $ 50,841 | $ (4,187) | $ (607) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
OPERATING ACTIVITIES: | |||
Net income | $ 12,221,000 | $ 9,861,000 | $ 11,145,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 3,979,000 | 3,589,000 | 3,434,000 |
Bad debt expense | 130,000 | 80,000 | |
Interest amortization / write-off of deferred financing costs | 82,000 | 284,000 | 104,000 |
Stock-based compensation expense | 2,212,000 | 2,021,000 | 936,000 |
Deferred income taxes, net | 1,061,000 | (1,821,000) | 1,322,000 |
Revaluation of contingent consideration liability | (2,882,000) | (6,069,000) | |
Operating lease assets and liabilities, net | 173,000 | 18,000 | 100,000 |
Loss on disposition of fixed assets | 9,000 | 4,000 | |
Long-term accrued income taxes | (40,000) | (20,000) | (19,000) |
Working capital items: | |||
Accounts receivable and unbilled receivables | (11,389,000) | 2,133,000 | 5,648,000 |
Prepaid and other current assets | (2,544,000) | 251,000 | (386,000) |
Accounts payable | 2,365,000 | (1,613,000) | (100,000) |
Accrued payroll and related costs | (429,000) | 6,287,000 | 174,000 |
Other accrued liabilities | 202,000 | 91,000 | (264,000) |
Deferred revenue | 66,000 | 146,000 | (21,000) |
Net cash flows provided by operating activities | 5,216,000 | 21,231,000 | 16,084,000 |
INVESTING ACTIVITIES: | |||
Acquisition of AmberLeaf (net of cash acquired and issuance of contingent consideration) | (9,345,000) | ||
Recovery of (payments for) non-current deposits | (199,000) | 9,000 | 135,000 |
Capital expenditures | (1,895,000) | (298,000) | (1,014,000) |
Proceeds from the sale of fixed assets | 10,000 | ||
Net cash flows (used in) investing activities | (2,084,000) | (9,634,000) | (879,000) |
FINANCING ACTIVITIES: | |||
(Repayments) borrowing on revolving credit facility, net | 0 | (9,551,000) | (3,976,000) |
Borrowing on term loan facility | 17,500,000 | ||
(Repayments) on term loan facility | (4,400,000) | (15,969,000) | (9,575,000) |
Proceeds from the issuance of common stock | 301,000 | 222,000 | 168,000 |
Payment of deferred financing costs | (223,000) | (246,000) | |
Purchase of treasury stock | 0 | (13,000) | |
Proceeds from the exercise of stock options | 229,000 | 1,330,000 | 7,000 |
Net cash flows (used in) financing activities | (4,093,000) | (6,714,000) | (13,389,000) |
Effect of exchange rate changes on cash and cash equivalents | (94,000) | (187,000) | (129,000) |
Net change in cash and cash equivalents | (1,055,000) | 4,696,000 | 1,687,000 |
Cash and cash equivalents, beginning of period | 7,677,000 | 2,981,000 | 1,294,000 |
Cash and cash equivalents, end of period | 6,622,000 | 7,677,000 | 2,981,000 |
SUPPLEMENTAL DISCLOSURE: | |||
Cash payments for interest expense | 623,000 | 779,000 | 1,780,000 |
Cash payments for income taxes | $ 3,831,000 | $ 2,681,000 | $ 2,634,000 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies: Basis of Presentation References in this Annual Report on Form 10-K Description of Business We are a provider of Digital Transformation IT Services to mostly large and medium-sized Our portfolio of offerings includes data management and analytics services; digital learning services; and IT staffing services. Reflective of our 2017 acquisition of the services division of Canada-based InfoTrellis, Inc., we have added specialized capabilities in delivering data and analytics services to our customers globally. This business offers project-based consulting services in the areas of data management, data engineering and data science, with such services delivered using on-site Our IT staffing business combines technical expertise with business process experience to deliver a broad range of staffing services in digital and mainstream technologies. Our digital technologies include data management, analytics, cloud, mobility, social and artificial intelligence. We work with businesses and institutions with significant IT spending and recurring staffing service needs. We also support smaller organizations with their “project focused” temporary IT staffing requirements. The COVID-19 roll-out COVID-19 COVID-19 Accounting Principles The Company’s Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Principles of Consolidation The Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results could differ from these estimates. Cash and Cash Equivalents Cash and cash equivalents are defined as cash and highly liquid debt investments with maturities of three months or less when purchased. Cash equivalents are stated at cost, which approximates market value. Accounts Receivable and Unbilled Receivables The Company extends credit to clients based upon management’s assessment of their creditworthiness. A substantial portion of the Company’s revenue, and the resulting accounts receivable, are from Fortune 1000 companies, major systems integrators and other staffing organizations. The Company does not generally charge interest on delinquent accounts receivable. Unbilled receivables represent amounts recognized as revenues based on services performed and, in accordance with the terms of the client contract, will be invoiced in a subsequent period. See Note 2 “Revenue from Contracts with Customers” for further details. Allowance for Uncollectible Accounts Accounts receivable are reviewed periodically to determine the probability of loss. The Company records an allowance for uncollectible accounts when it is probable that the related receivable balance will not be collected based on historical collection experience, client-specific collection issues, and other matters the Company identifies in its collection monitoring. The Allowance for Uncollectible Accounts was $375,000 and $413,000 at December 31, 2021 and 2020, respectively. There were $130,000, $0 and $80,000 of bad debt expense charges for the years ended December 31, 2021, 2020 and 2019, respectively, which amounts are reflected in the Consolidated Statements of Operations. Equipment, Enterprise Software and Leasehold Improvements Equipment, enterprise software and leasehold improvements are stated at historical cost. The Company provides for depreciation using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of (a) the remaining term of the lease or (b) the estimated useful life of the improvements. Repairs and maintenance, which do not extend the useful life of the respective assets, are charged to expense as incurred. Upon disposal, assets and related accumulated depreciation are removed from the Company’s accounts and the resulting gains or losses are reflected in the Company’s Consolidated Statement of Operations. The estimated useful lives of depreciable assets are primarily as follows: Laptop Computers 18 months Equipment 3- 5 Enterprise Software 3- 5 The Company capitalizes certain external and internal computer software and software development costs incurred during the application development stage. The application development stage generally includes software design and configuration, coding, testing and installation activities. Capitalized costs include only external direct cost of material and services consumed in developing or obtaining internal-use internal-use The Company implemented new enterprise software applications to its backbone systems environment. The Company has capitalized $2.4 million related to this endeavor for which the core system was placed in service on July 1, 2018. The Company started amortizing these costs commencing with this go-live Depreciation and amortization expense related to fixed assets totaled $809,000, $799,000 and $746,000 for the years ended December 31, 2021, 2020 and 2019, respectively. Goodwill and Intangible Assets Identifiable intangible assets are recorded at fair value as of the closing date when acquired in a business combination. Identifiable intangible assets related to acquisitions consisted of client relationships, covenants not-to-compete, Excess purchase price over the fair value of net tangible assets and identifiable intangible assets acquired are recorded as goodwill. Goodwill is not amortized but is tested for impairment at least on an annual basis. If impairment is indicated, a write-down to fair value is recorded based on the excess of the carrying value of the reporting unit over its fair market value. We review goodwill and intangible assets for impairment annually as of October 1 st In conducting our annual impairment testing, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not (more than 50%) that the estimated fair value of a reporting unit is less than its carrying amount. If not, no further goodwill impairment testing is required. If it is more likely than not that a reporting unit’s fair value is less than its carrying amount, we are then required to perform a quantitative impairment test. We also may elect not to perform the qualitative assessment, and instead, proceed directly to the quantitative impairment test. In 2021, 2020 and 2019, we performed quantitative impairment tests related to our June 2015 acquisition of Hudson Global Resources Management, Inc.’s U.S. IT staffing business (“Hudson IT”). The results of each of these testing’s indicated no impairment associated with the carrying amount of goodwill. Additionally in 2021, 2020 and 2019, we performed quantitative impairment tests related to our Data and Analytics segment which includes the July 2017 acquisition of InfoTrellis and the October 2020 acquisition of AmberLeaf. The results of each of these testing’s indicated no impairment associated with the carrying amount of goodwill. Business Combinations The Company accounts for acquisitions in accordance with guidance found in ASC 805, Business Combinations (1) in-process indefinite-lived intangible asset; (2) acquisition-related transaction costs will generally be expensed as incurred; (3) restructuring costs associated with a business combination will generally be expensed subsequent to the acquisition date; and (4) changes in deferred tax asset valuation allowances and income tax uncertainties after the acquisition date generally will effect income tax expense. ASC 805 requires that any excess purchase price over fair value of assets acquired (including identifiable intangibles) and liabilities assumed be recognized as goodwill. Additionally, any excess fair value of acquired net assets over acquisition consideration results in a bargain purchase gain. Prior to recording a gain, the acquiring entity must reassess whether all acquired assets and assumed liabilities have been identified and must perform re-measurements The AmberLeaf financial results are included in the Company’s Consolidated Financial Statements from the date of the acquisition of October 1, 2020. Leases Leases Right-of-use Income Taxes The Company records an estimated liability for income and other taxes based on what management determines will likely be paid in the various tax jurisdictions in which we operate. Management uses its best judgment in the determination of these amounts. However, the liabilities ultimately realized and paid are dependent on various matters, including the resolution of the tax audits in the various affected tax jurisdictions, and may differ from the amounts recorded. An adjustment to the estimated liability would be recorded through income in the period in which it becomes probable that the amount of the actual liability differs from the amount recorded. Management determines the Company’s income tax provision using the asset and liability method. Under this method, deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. The Company measures deferred tax assets and liabilities using enacted tax rates in effect for the year in which we expect to recover or settle the temporary differences. The effect of a change in tax rates on deferred taxes is recognized in the period that the change is enacted. The Company evaluates its deferred tax assets and records a valuation allowance when, in management’s opinion, it is more likely than not that some portion or all of the deferred tax assets will not be realized. As of December 31, 2021 and 2020, the Company provided a valuation allowance of $311,000 and $179,000, respectively, related to the uncertainty of the realization of foreign net operating losses (“NOL”). The Tax Cuts and Jobs Act of 2017 (“TCJA”) created a new requirement that certain income earned by foreign subsidiaries, known as global intangible low-tax The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, Accounting for Uncertainty in Income Taxes The Company’s 2018 federal income tax return was audited by the Internal Revenue Service (“IRS”) in 2021 with no adjustment to our original filing. In 2019, the Company and the IRS agreed to certain adjustments related to the Company’s 2015 and 2016 income tax returns. The impact of this settlement on the Company’s tax provision in 2019 was not material. Deferred Financing Costs The Company capitalizes expenses directly related to securing its credit facilities. These deferred costs are amortized as interest expense over the term of the underlying facilities. Unamortized deferred financing costs are included as reductions in the long-term debt in the Consolidated Balance Sheets. Contingent Consideration Liability In connection with the AmberLeaf acquisition, the Company has an obligation to pay consideration that is contingent upon the achievement of specified revenue growth and EBITA margin objectives. As of the acquisition date, the Company recorded a contingent consideration liability of $2.9 million representing the estimated fair value of the contingent consideration that is expected to be paid. The fair value of the contingent consideration liability was estimated by utilizing a probability weighted simulation model to determine the fair value of contingent consideration. In connection with the InfoTrellis acquisition, the Company had an obligation to pay consideration that was contingent upon the achievement of specified earnings before interest and taxes objectives (“EBIT”). As of the acquisition date, the Company recorded a contingent consideration liability representing the estimated fair value of the contingent consideration that was expected to be paid. The fair value of the contingent consideration liability was estimated by utilizing a probability weighted simulation model to determine the fair value of contingent consideration. We re-measured In 2021, the Company revalued the contingent consideration liability related to the AmberLeaf acquisition after determining that relevant conditions for payment of such liability were likely not to be satisfied. The revaluation resulted in a $2.9 million reduction in the contingent consideration liability. In 2019, the Company revalued the contingent consideration liability of the InfoTrellis acquisition after determining that relevant conditions for payment of such liability were not satisfied. The revaluation resulted in a $6.1 million reduction to the contingent consideration liability. No contingent consideration revaluation was recorded in 2020. Both of these credits are reflected in selling, general and administrative expenses in the Company’s Consolidated Statements of Operations, in Item 8, herein. No contingent consideration liability remained outstanding as of December 31, 2021. Segment Reporting The Company has two Revenue Recognition The Company recognizes revenue on time-and-material Time-and-material out-of-pocket Out-of-pocket The Company recognizes revenue on fixed price contracts over time as services are rendered and uses a cost-based input method to measure progress. Determining a measure of progress requires management to make judgments that affect the timing of recognizing revenue. Under the cost-based input method, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues, including estimated fees or profits, are recorded proportionally as costs are incurred. The Company has determined that the cost-based input method provides a faithful depiction of the transfer of goods or services to the customer. Estimated losses are recognized immediately in the period in which current estimates indicate a loss. We record deferred revenues when cash payments are received or due in advance of our performance, including amounts which may be refundable. The Company’s time-and-material In certain situations related to client direct hire assignments, where the Company’s fee is contingent upon the hired resources’ continued employment with the client, revenue is not fully recognized until such employment conditions are satisfied. Stock-Based Compensation Effective October 1, 2008, the Company adopted a Stock Incentive Plan (the “Plan”) which, as amended, provides that up to 4,900,000 shares (adjusted for the 2018 two-for-one three In October 2018, the Board of Directors of the Company approved the Mastech Digital, Inc. 2019 Employee Stock Purchase Plan (the “Stock Purchase Plan”). The Stock Purchase Plan is intended to meet the requirements of Section 423 of the Code and required the approval of the Company’s shareholders to be qualified under Section 423 of the Code. On May 15, 2019, the Company’s shareholders approved the Stock Purchase Plan. Under the Stock Purchase Plan, 600,000 shares of Common Stock (subject to adjustment upon certain changes in the Company’s capitalization) are available for purchase by eligible employees who become participants in the Stock Purchase Plan. The purchase price per share is 85% of the lesser of (1) the fair market value per share of Common Stock on the first day of the offering period, or (ii) the fair market value per share of Common Stock on the last day of the offering period. The Company accounts for stock-based compensation expense in accordance with ASC Topic 718 “ Share-based Payments Treasury Stock The Company maintained a stock repurchase program which expired on December 22, 2016. Under the program, the Company made treasury stock purchases in the open market, subject to market conditions and normal trading restrictions. Upon expiration, the program was not extended by the Company’s Board of Directors. Additionally, the Company makes stock purchases from time to time to satisfy employee tax obligations related to its Stock Incentive Plan. At December 31, 2021 and 2020, the Company held 1.6 million shares in its treasury at a cost of approximately $4.2 million. Comprehensive Income Comprehensive income as presented in the Consolidated Statements of Comprehensive Income consists of net income, unrealized gains or losses, net of tax, on cash flow hedging transactions and foreign currency translation adjustments. Derivative Instruments and Hedging Activities – Interest Rate Swap Contracts Concurrent with the Company’s borrowings on July 13, 2017 under its new credit facility, the Company entered into an interest-rate swap to convert the debt’s variable interest rate to a fixed rate of interest. These swap contracts, which matured on April 1, 2021, have been designated as cash flow hedging instruments and qualified as effective hedges at inception under ASC Topic 815, “Derivatives and Hedging”. These contracts are recognized on the balance sheet at fair value. The effective portion of the changes in fair value on these contracts is recorded in other comprehensive income (loss) and is reclassified into the Consolidated Statements of Operations as interest expense in the same period in which the underlying transaction affects earnings. With respect to derivatives designated as hedges, the Company formally documents all relationships between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking such transactions. The Company evaluates hedge effectiveness at the time a contract is entered into and on an ongoing basis. If a swap contract is deemed ineffective, the change in the fair value of the derivative is recorded in the Consolidated Statement of Operations as interest expense. Foreign Currency Translation The reporting currency of the Company and its subsidiaries is the U.S. dollar. The functional currency of the Company’s subsidiary in Canada is the U.S. dollar because the majority of its revenue is denominated in U.S. dollars. The functional currency of the Company’s Indian and European subsidiaries is their local currency. The results of operations of the Company’s Indian and European subsidiaries are translated at the monthly average exchange rates prevailing during the period. The financial position of the Company’s Indian and European subsidiaries is translated at the current exchange rates at the end of the period, and the related translation adjustments are recorded as a component of accumulated other comprehensive income (loss) within Shareholders’ Equity. Gains and losses resulting from foreign currency transactions are included as a component of other income (expense), net in the Consolidated Statements of Operations, and have not been material for all periods presented. Earnings Per Share Basic earnings per share are computed using the weighted-average number of common shares outstanding during the period. Diluted earnings per share are computed using the weighted-average number of common shares outstanding during the period, plus the incremental shares outstanding assuming the exercise of dilutive stock options and the vesting of restricted shares and performance shares, calculated using the treasury stock method. Recently Issued Accounting Standards Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, In March 2020, the FASB issued ASU 2020-04, Recent Accounting Pronouncements not yet adopted In October 2021, the FASB issued ASU 2021-08, In November 2021, the FASB issued ASU 2021-10, A variety of proposed or otherwise potential accounting standards are currently under consideration by standard-setting organizations and certain regulatory agencies. Because of the tentative and preliminary nature of such proposed standards, management has not yet determined the effect, if any that the implementation of such proposed standards would have on the Company’s consolidated financial statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 12 Months Ended |
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | 2. Revenue from Contracts with Customers The Company recognizes revenue on time-and-material Time-and-material out-of-pocket Out-of-pocket The Company’s time-and-material In certain situations related to client direct hire assignments, where the Company’s fee is contingent upon the hired resources continued employment with the client, revenue is not fully recognized until such employment conditions are satisfied. The Company recognizes revenue on fixed price contracts over time as services are rendered and uses a cost-based input method to measure progress. Determining a measure of progress requires management to make judgments that affect the timing of revenue recognized. Under the cost-based input method, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues, including estimated fees or profits, are recorded proportionally as costs are incurred. The Company has determined that the cost-based input method provides a faithful depiction of the transfer of goods or services to the customer. Estimated losses are recognized immediately in the period in which current estimates indicate a loss. We record deferred revenues when cash payments are received or due in advance of our performance, including amounts which may be refundable. We do not sell, lease or otherwise market computer software or hardware, and essentially 100% of our revenue is derived from the sale of data and analytics, IT staffing and digital transformation services. We expense sales commissions in the same period in which revenues are realized. These costs are recorded within selling, general and administrative expenses. Each contract the Company enters into is assessed to determine the promised services to be performed and includes identification of the performance obligations required by the contract. In substantially all of our contracts, we have identified a single performance obligation for each contract either because the promised services are distinct or the promised services are highly interrelated and interdependent and therefore represent a combined single performance obligation. Our Data and Analytics Services segment provides specialized capabilities in delivering data management and analytics services to customers globally. This business offers project-based consulting services in the areas of Master Data Management, Enterprise Data Integration, Big Data, Analytics and Digital Transformation, which can be delivered using onsite and offshore resources. Our IT staffing business combines technical expertise with business process experience to deliver a broad range of services in digital and mainstream technologies. Our digital technology stack includes data management and analytics, cloud, mobility, social and automation. Our mainstream technologies include business intelligence / data warehousing; web services; enterprise resource planning & customer resource management; and e-Business IT-spend The following table depicts the disaggregation of our revenues by contract type and operating segment: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Data and Analytics Services Segment Time-and-material $ 25,224 $ 18,541 $ 18,732 Fixed-price Contracts 13,115 11,685 7,931 Subtotal Data and Analytics Services $ 38,339 $ 30,226 $ 26,663 IT Staffing Services Segment Time-and-material $ 183,673 $ 163,875 $ 166,911 Fixed-price Contracts — — — Subtotal IT Staffing Services $ 183,673 $ 163,875 $ 166,911 Total Revenues $ 222,012 $ 194,101 $ 193,574 The Company had one client that exceeded 10% of total revenues in 2021, 2020 and 2019 (CGI = 15.0%, 15.0% and 11.3%, respectively). Additionally, CGI accounted for 19.5% and 11.7% of the Company’s accounts receivable balance at December 31, 2021 and 2020, respectively. The Company’s top ten clients represented approximately 48%, 47% and 45% of total revenues in 2021, 2020 and 2019, respectively. The following table presents our revenue from external customers disaggregated by geography, based on the work location of our customers: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) United States $ 214,379 $ 189,890 $ 188,710 Canada 4,543 3,603 2,918 India and Other 3,090 608 1,946 Total $ 222,012 $ 194,101 $ 193,574 |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Business Combinations | 3. Business Combinations On October 1, 2020, Mastech Digital, Inc., through its wholly-owned subsidiary Mastech Digital Data, Inc., acquired all of the outstanding shares of AmberLeaf Partners, Inc. (“AmberLeaf”). Under the terms of the Share Purchase Agreement executed in connection with the AmberLeaf acquisition (the “Purchase Agreement”), the Company paid at the closing of the acquisition approximately $9.7 million in cash. The Purchase Agreement also requires the Company to pay to the former shareholders of AmberLeaf up to $4.5 million in deferred cash payments, which payments are contingent upon the AmberLeaf business achieving specific revenue growth and EBITDA margin targets. The amount of these deferred cash payments, if any, is based upon the revenue growth and EBITDA margins of the AmberLeaf business for the 12-month 12-month To fund the acquisition, on October 1, 2020 the Company entered into a Third Amendment (the “Third Amendment”) to its Credit Agreement, as amended and dated April 20, 2018. The Third Amendment revised the Credit Agreement by, among other things, (1) increasing the aggregate commitment amount of the revolving credit facility to $30 million (an increase of $7.5 million); (2) providing for the Term Loan facility in the aggregate amount of $17.5 million (an increase of $10 million); (3) providing for an increase in the total commitment amount to the facility in an aggregate amount not to exceed $15 million, upon the satisfaction of certain conditions; and (4) amending the financial covenant in the Credit Agreement related to the Company’s Fixed Charge Coverage Ratio (as defined in the Credit Agreement) by increasing the minimum permitted Fixed Charge Coverage Ratio for each of the fiscal quarters ending on or after September 30, 2020. The acquisition was accounted for using the acquisition method of accounting. The acquisition method of accounting requires that the assets acquired and liabilities assumed be measured at their fair value as of the closing date. The following table summarizes the fair value of consideration for the acquired business on the October 1, 2020 closing date: (in thousands) Amounts Cash purchase price at closing $ 9,664 Working capital adjustments — Estimated payout of contingent consideration (1) 2,882 Total Fair Value of Consideration $ 12,546 (1) Based on a valuation conducted by an independent third party, the fair value of contingent consideration at the closing date was determined to be $2.9 million During 2021, the Company revalued the contingent conside rati The cash purchase price at closing was paid with funds obtained from the following sources: (in thousands) Amounts Cash balances on hand $ — Increase in term loan debt facility 10,000 Revolving line of credit (336 ) Cash Paid at Closing $ 9,664 The allocation of the purchase price was based on estimates of the fair value of assets acquired and liabilities assumed as of October 1, 2020, as set forth below. The excess purchase price over the fair values of the net tangible assets and identifiable intangible assets was recorded as goodwill, which includes value associated with the assembled workforce. Goodwill is expected to be largely deductible for tax purposes. The valuation of net assets acquired is as follows: (in thousands) Amounts Cash on hand $ 319 Working capital assets, net of liabilities 1,153 Identifiable intangible assets: Client relationships 2,970 Covenant not-to-compete 440 Trade name 490 Technology 770 Total identifiable intangible assets 4,670 Goodwill 6,404 Net Assets Acquired $ 12,546 The fair value of identifiable intangible assets has been estimated using the income approach through a discounted cash flow analysis. Specifically, the Company used the income approach through an excess earnings analysis to determine the fair value of client relationships. The value applied to the covenant not-to-compete The Company incurred $650,000 of transaction expenses related to the acquisition in 2020 inclusive of the write-off Included in the Consolidated Statement of Operations for year ended December 31, 2020 are revenues of $2.4 million and a net loss of approximately $0.4 million applicable to the Amber Leaf operations from our October 1, 2020 acquisition date through December 31, 2020. The following reflects the Company’s unaudited pro forma results had the results of AmberLeaf been included from January 1, 2018 for all periods presented: Years Ended December 31, 2021 2020 2019 (Amounts in thousands, except per share data) Revenue $ 222,012 $ 202,842 $ 204,846 Net income $ 12,221 $ 10,594 $ 12,119 Earnings per share—diluted $ 1.02 $ .89 $ 1.08 The information above does not reflect all of the operating efficiencies or inefficiencies that may have resulted from the AmberLeaf acquisition in those periods prior to the acquisition. Therefore, the unaudited pro forma information above is not necessarily indicative of results that would have been achieved had the business been combined during all periods presented. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets, net | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets, net | 4. Goodwill and Other Intangible Assets, net Goodwill related to our June 15, 2015 acquisition of Hudson IT totaled $8.4 million. Goodwill related to our July 13, 2017 acquisition of the services division of InfoTrellis totaled $27.4 million. Goodwill related to our October 1, 2020 acquisition of AmberLeaf totaled $6.4 million. During 2018, the Company recorded a goodwill impairment related to the InfoTrellis acquisition of $9.7 million. A reconciliation of the beginning and ending amounts of goodwill by operating segment for the three years ended December 31, 2021 is as follows: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) IT Staffing Services: Beginning balance $ 8,427 $ 8,427 $ 8,427 Goodwill recorded — — — Impairment — — — Ending balance $ 8,427 $ 8,427 $ 8,427 Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Data and Analytics Services: Beginning balance $ 24,083 $ 17,679 $ 17,679 Goodwill recorded — 6,404 — Impairment — — — Ending balance $ 24,083 $ 24,083 $ 17,679 The Company is amortizing the identifiable intangible assets on a straight-line basis over estimated average lives ranging from 3 to 12 years. Identifiable intangible assets were comprised of the following as of December 31, 2021 and 2020: As of December 31, 2021 (Amounts in thousands) Amortization Gross Carrying Accumulative Net Carrying IT Staffing Services: Client relationships 12 $ 7,999 $ 4,361 $ 3,638 Covenant-not-to-compete 5 319 319 — Trade name 3 249 249 — Data and Analytics Services: Client relationships 12 19,641 6,503 13,138 Covenant-not-to-compete 5 1,201 788 413 Trade name 5 1,711 1,211 500 Technology 7 1,979 908 1,071 Total Intangible Assets $ 33,099 $ 14,339 $ 18,760 As of December 31, 2020 (Amounts in thousands) Amortization Gross Carrying Accumulative Net Carrying IT Staffing Services: Client relationships 12 $ 7,999 $ 3,694 $ 4,305 Covenant-not-to-compete 5 319 319 — Trade name 3 249 249 — Data and Analytics Services: Client relationships 12 19,641 4,866 14,775 Covenant-not-to-compete 5 1,201 548 653 Trade name 5 1,711 869 842 Technology 7 1,979 624 1,355 Total Intangible Assets $ 33,099 $ 11,169 $ 21,930 Amortization expense for the years ended December 31, 2021, 2020 and 2019 totaled $3.2 million, $2.8 million and $2.7 million, respectively and is included in selling, general and administrative expenses in the Consolidated Statement of Operations. The estimated aggregate amortization expense for intangible assets for the years ending December 31, 2022 through 2026 is as follows: Years Ended December 31, 2022 2023 2024 2025 2026 (Amounts in thousands) Amortization expense $ 2,987 $ 2,772 $ 2,693 $ 2,553 $ 2,413 61 |
Cash and Cash Equivalents
Cash and Cash Equivalents | 12 Months Ended |
Dec. 31, 2021 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | 5. Cash and Cash Equivalents The Company had cash and cash equivalents consisting of cash balances on hand and money market funds that totaled $6.6 million at December 31 , 2021 and $7.7 million at December 31 , 2020 . There were no restrictions on the Company’s cash balances during the periods presented. |
Credit Facility
Credit Facility | 12 Months Ended |
Dec. 31, 2021 | |
Text Block [Abstract] | |
Credit Facility | 6. Credit Facility On July , , the Company entered into a Credit Agreement (the “Credit Agreement”) with PNC Bank, as administrative agent, swing loan lender and issuing lender, PNC Capital Markets LLC, as sole lead arranger and sole book-runner, and certain financial institution parties thereto as lenders (the “Lenders”). The Credit Agreement, as amended, provides for a total aggregate commitment of $ million, consisting of (i) a revolving credit facility (the “Revolver”) in an aggregate principal amount not to exceed $ million and; (ii) a $ million term loan facility (the “Term Loan), as more fully described in Exhibit to the Company’s Form 8-Ks filed with the SEC on July , , April , and October , , and Exhibit to the Form 8-K/A filed with the SEC on January , . Additionally, the facility includes an accordion feature for additional borrowing of up to $ million upon satisfaction of certain conditions. The Revolver expires in and includes swing loan and letter of credit sub-limits in the aggregate amount not to exceed $ million for swing loans and $ million for letters of credit. Borrowings under the Revolver may be denominated in U.S. dollars or Canadian dollars. The maximum borrowings in U.S. dollars may not exceed the sum of % of eligible U.S. accounts receivable and % of eligible U.S. unbilled receivables, less a reserve amount established by the administrative agent. The maximum borrowings in Canadian dollars may not exceed the lesser of (i) $ million; and (ii) the sum of % of eligible Canadian receivables, plus % of eligible Canadian unbilled receivables, less a reserve amount established by the administrative agent. Amounts borrowed under the Term Loan are required to be repaid in consecutive quarterly installments through and including the maturity date of October , . The principal amount of each quarterly installment payable on the Term Loan equals $ million through and including the maturity date, with the maturity date payment equal to the outstanding amount of the loan on that date. Borrowings under the revolver and the term loan, at the Company’s election, bear interest at either (a) the higher of PNC’s prime rate or the federal funds rate plus %, plus an applicable margin determined based upon the Company’s senior leverage ratio or (b) the Bloomberg Short-Term Bank Yield Index (“BSBY”), plus an applicable margin determined based upon the Company’s senior leverage ratio. The applicable margin on the base rate is between % and % on revolver borrowings and between % and % on term loans. The applicable margin on the BSBY is between % and % on revolver borrowings and between % and % on term loans. A to 30-basis point per annum commitment fee on the unused portion of the revolver facility is charged and due monthly in arrears. The applicable commitment fee is determined based upon the Company’s senior leverage ratio. The Company pledged substantially all of its assets in support of the Credit Agreement. The credit agreement contains standard financial covenants, including, but not limited to, covenants related to the Company’s senior leverage ratio and fixed charge ratio (as defined under the credit agreement) and limitations on liens, indebtedness, guarantees, contingent liabilities, loans and investments, distributions, leases, asset sales, stock repurchases and mergers and acquisitions. As of December , , the Company was in compliance with all provisions under the facility. In connection with securing the commitments under the Credit Agreement and the April , , October , and December , amendments to the Credit Agreement, the Company paid a commitment fee and incurred deferred financing costs totaling $975,000, which were capitalized and are being amortized as interest expense over the life of the facility. Deferred financing costs of $366,000 and $225,000 (net of amortization) as of December 31 , 2021 and December 31 , 2020 , respectively, are presented as reductions in long-term debt in the Company’s Consolidated Balance Sheets. As of December 31 , 2021 and 2020 , the Company’s outstanding borrowings under the Revolver totaled $0 million and $0 million, respectively; and unused borrowing capacity available was approximately As of December 31, 2021, the annual aggregate maturities of our outstanding debt (exclusive of deferred financing costs amortization) during each of the next five years are as follows: Total Amount (Amounts in thousands) 2022 $ 4,400 2023 4,400 2024 4,300 2025 — 2026 — Total $ 13,100 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Leases | 7. Leases The Company rents certain office facilities and equipment under noncancelable operating leases. As of December 31, 2021, approximately 97,000 square feet of office space is utilized for our sales and recruiting offices, delivery centers, and corporate headquarters. All of our leases are classified as operating leases. The average initial lease term is four years. Several leases have an option to renew, at our sole discretion, for an additional term. Our present lease terms range from less than one year to 5.2 years with a weighted average remaining term of 3.9 years. Leases with an initial term of twelve months or less are not recorded on the balance sheet. Leases Right-of-use The following table summarizes the balance sheet classification of the lease assets and related lease liabilities: December 31, 2021 December 31, 2020 ( in thousands) Assets: Long-term operating lease right-of-use $ 4,894 $ 3,286 Liabilities: Short-term operating lease liability $ 1,479 $ 1,079 Long-term operating lease liability 3,706 2,325 Total Liabilities $ 5,185 $ 3,404 Amount as of ( in thousands) 2022 $ 1,687 2023 1,639 2024 899 2025 629 2026 612 Thereafter 144 Total $ 5,610 Less: Imputed interest (425 ) Present value of operating lease liabilities $ 5,185 The weighted average discount rate used to calculate the present value of future lease payments was 4.2%. We recognize rent expense for these leases on a straight-line basis over the lease term. Rental expense for the years ended December 31, 2021, 2020 and 2019 totaled $1.8 million, $1.6 million and $1.6 million, respectively. Total cash paid for lease liabilities for the years ended December 31, 2021, 2020 and 2019 totaled $1.5 million, $1.7 million and $1.6 million, respectively. New leases entered into during the years ended December 31, 2021, 2020 and 2019 totaled $3.1 million, $0.2 million and $0.5 million, respectively, and are considered non cash transactions. |
Long-Term Payroll Tax Liability
Long-Term Payroll Tax Liability | 12 Months Ended |
Dec. 31, 2021 | |
Payroll Tax Liability [Abstract] | |
Long-Term Payroll Tax Liability | 8. Long-Term Payroll Tax Liability As allowed under the Coronavirus Aid, Relief and Economic Security (CARES) Act, the Company elected to defer payment of the employer’s share of social security tax. As of December 31, 2021 and 2020, the balance of this liability is $2.3 million and $4.6 million, respectively. The Company paid $2.3 million of the deferred amount in December 2021 and is required to repay the remaining $2.3 million by December 31, 2022 which is reflected as part of current liabilities under the caption accrued payroll and related costs. As of December 31, 2021 and 2020, the long-term liability balance, under the caption long-term payroll tax liabilities, is $0 and $2.3 million, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitment and Contingencies In the ordinary course of business, the Company is involved in a number of lawsuits and administrative proceedings. While uncertainties are inherent in the final outcome of these matters, management believes, after consultation with legal counsel, that the disposition of these proceedings should not have a material adverse effect on our financial position, results of operations or cash flows. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | 10. Employee Benefit Plan The Company provides an Employee Retirement Savings Plan (the “Retirement Plan”) under Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”), that covers substantially all U.S.-based salaried employees. Concurrent with the 2015 acquisition of Hudson IT, the Company expanded employee eligibility under the Retirement Plan to include all U.S.-based W-2 percentage of eligible compensation to the Retirement Plan, subject to certain limits under the Code. For Hudson IT employees enrolled in the Hudson Employee Retirement Savings Plan at the acquisition date, the Company provided a matching contribution of 50% of the first 6% of the participant’s contributed pay, subject to vesting based on their combined tenure with Hudson and Mastech. For all other employees, the Company did not provide for any matching contributions for the three years ended December 31, 2021. Effective January 1, 2020, the Company eliminated the 401(k) match for former Hudson IT employees. Mastech’s total contributions to the Retirement Plan related to the qualified Hudson IT employees totaled $0, $0 and $55,000 for the three years ended December 31, 2021, 2020 and 2019, respectively. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | 11. Stock-Based Compensation Effective October 1, 2008, the Company adopted a Stock Incentive Plan (the “Plan”) which, as amended, provides that up to 4,900,000 shares of the Company’s common stock shall be allocated for issuance to directors, executive management and key personnel. Grants under the Plan can be made in the form of stock options, stock appreciation rights, performance shares or stock awards. As of December 31, 2021, the Company had 3,836,000 outstanding and/or exercised stock options, 260,000 vested performance shares and 266,000 outstanding and/or released restricted stock units that were issued under the Plan. Thus, as of December 31, 2021, the Company has 538,000 shares available for future grants under the Plan. The Plan is administered by the Compensation Committee of the Board of Directors. All grants awarded under the Plan are recommended by the Committee to the Board of Directors for approval. The exercise price of stock options is set on the grant date and is not to be less than the fair market value per share of our closing stock price on that date. Grants of stock options and restricted stock awards generally vest over a three Following is a summary of the Company’s stock option activity for the three years ended December 31, 2021: Number of Weighted Average Outstanding at December 31, 2018 1,111,000 $ 4.95 Granted 683,000 6.48 Exercised (6,000 ) 1.18 Cancelled / forfeited (67,000 ) 6.35 Outstanding at December 31, 2019 1,721,000 5.52 Granted 800,000 15.49 Exercised (305,000 ) 4.36 Cancelled / forfeited (207,000 ) 8.04 Outstanding at December 31, 2020 2,009,000 9.40 Granted 501,000 17.58 Exercised (31,000 ) 7.34 Cancelled / forfeited (438,000 ) 13.04 Outstanding at December 31, 2021 2,041,000 $ 10.66 As of December 31, 2021, the Company’s outstanding “in the money” stock options using the year-end The table below summarizes information regarding the Company’s outstanding and exercisable stock options as of December 31, 2021: Range of Exercise Prices: Options Weighted Average Weighted Average $0.01 to $4.00 355,000 4.2 $ 3.56 $4.01 to $8.00 717,000 7.0 6.68 $8.01 to $12.00 — — — $12.01 to $16.00 628,000 8.2 15.49 $16.01 to $20.00 341,000 9.6 17.55 2,041,000 7.3 $ 10.66 Range of Exercise Prices: Options Weighted Average Weighted Average $0.01 to $4.00 355,000 4.2 $ 3.56 $4.01 to $8.00 268,000 6.8 6.80 $8.01 to $12.00 — — — $12.01 to $16.00 123,000 8.2 15.49 $16.01 to $20.00 — — — 746,000 5.8 $ 6.69 Stock options of 501,000 units were issued during the year ended December 31, 2021, of which 491,000 vest over a four-year period and 10,000 vest over a one-year during the year ended December , , of which vest over a period and vest over a one-year period. Stock options of units were issued during the year ended December , and vest over a period. Years Ended December 31, 2021 2020 2019 Stock option grants: Weighted-average risk-free interest rate 0.6 % 1.4 % 2.4 % Weighted-average dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 68.3 % 52.7 % 49.7 % Expected term (in years) 3.8 3.9 5.0 Weighted-average fair value $ 8.85 $ 6.36 $ 2.95 Risk-free interest rate Expected dividend yield Expected volatility Expected term Following is a summary of Mastech’s restricted stock activity for the three years ended December 31, 2021: Years Ended December 31, 2021 2020 2019 Beginning outstanding balance 30,843 33,285 34,380 Awarded 11,955 11,475 16,365 Released (17,739 ) (13,917 ) (17,460 ) Forfeited — — — Ending outstanding balance 25,059 30,843 33,285 The aggregate intrinsic value of restricted stock units outstanding at December 31, 2021 was $428,000. The total intrinsic value of restricted shares released during 2021 totaled $289,000. In October 2018, the Board of Directors of the Company approved the Mastech Digital, Inc. 2019 Employee Stock Purchase Plan (the “Stock Purchase Plan”). The Stock Purchase Plan is intended to meet the requirements of Section 423 of the Code and had to be approved by the Company’s shareholders to be qualified. On May 15, 2019, the Company’s shareholders approved the Stock Purchase Plan. Under the Stock Purchase Plan, 600,000 shares of Common Stock (subject to adjustment upon certain changes in the Company’s capitalization) are available for purchase by eligible employees who become participants in the Stock Purchase Plan. The purchase price per share is 85% of the lesser of (i) the fair market value per share of Common Stock on the first day of the offering period, or (ii) the fair market value per share of Common Stock on the last day of the offering period. During the year ended December 31, 2021 and December 31, 2020, the Company issued 23,492 and 20,459 shares under the Stock Purchase Plan at an average share of $12.84 and $10.91, respectively. At December 31, 2021, there were 515,549 shares available for purchases under the Plan. T he Company’s eligible full-time employees are able to contribute up to 15% of their base compensation into the employee stock purchase plan, subject to an annual limit of $25,000 per person. Employees are able to purchase Company common stock at a 15% discount to the lower of the fair market value of the Company’s common stock on the initial or final trading dates of each six -month offering period. Offering periods begin on January 1 and July 1 of each year. The Company uses the Black-Scholes option pricing model to determine the fair value of employee stock purchase plan share-based payments. The fair value of the six -month “look-back” option in the Company’s employee stock purchase plans is estimated by adding the fair value of 15% of one share of stock to the fair value of 85% of an option on one share of stock. six -month offering period. The Company utilized historical company data to develop its dividend yield and expected volatility assumptions. Stock-based compensation expense of $2.2 million, $2.0 million and $936,000 was recognized in the Consolidated Statements of Operations for the years ended December 31 , 2021 , 2020 , and 2019 , respectively. The Company has recognized related tax benefits associated with its stock-based compensation arrangements for the years ended December 31 , 2021 , 2020 , and 2019 of $622,000, $590,000, and $252,000, respectively. As of December 31 , 2021 , the total remaining unrecognized compensation expense related to non-vested stock options totaled $5.6 million and the total remaining unrecognized compensation expense related to restricted stock units amounted to $65,000 which will be amortized over the weighted-average remaining requisite service period of 0.4 years. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. Income Taxes Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Income before income taxes: Domestic $ 17,117 $ 11,476 $ 6,787 Foreign (231 ) 1,157 8,432 Income before income taxes $ 16,886 $ 12,633 $ 15,219 The Company has foreign subsidiaries which generate revenues from foreign clients. Additionally, the Company has foreign subsidiaries which provide services to its U.S. operations. Accordingly, the Company allocates a portion of its income to these subsidiaries based on a “transfer pricing” model and reports such income as foreign in the above table. The provision for income taxes, as shown in the accompanying Consolidated Statement of Operations, consisted of the following for the years ended December 31, 2021, 2020 and 2019: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Current provision: Federal $ 2,657 $ 3,044 $ 1,555 State 713 752 406 Foreign 234 797 751 Total current provision 3,604 4,593 2,712 Deferred provision (benefit): Federal 873 (1,340 ) (13 ) State 233 (327 ) (4 ) Foreign (177 ) (326 ) 1,372 Total deferred provision (benefit) 929 (1,993 ) 1,355 Change in valuation allowance 132 172 7 Total provision for income taxes $ 4,665 $ 2,772 $ 4,074 The reconciliation of income taxes computed using our statutory U.S. income tax rate and the provision for income taxes for the years ended December 31, 2021, 2020 and 2019 were as follows: Years Ended December 31, (Amounts in thousands) 2021 2020 2019 Income taxes computed at the federal statutory rate $ 3,546 21.0 % $ 2,653 21.0 % $ 3,196 21.0 % State income taxes, net of federal tax benefit 962 5.7 602 4.7 404 2.7 Excess tax benefits from stock options/restricted shares (82 ) (0.5 ) (920 ) (7.3 ) (9 ) (0.1 ) Charge for global intangible low-taxed — — (20 ) (0.2 ) 69 0.5 Difference in tax rate on foreign earnings/other 107 0.6 285 2.3 407 2.7 Change in valuation allowance 132 0.8 172 1.4 7 — $ 4,665 27.6 % $ 2,772 21.9 % $ 4,074 26.8 % The components of the deferred tax assets and liabilities were as follows: At December 31, 2021 2020 (Amounts in thousands) Deferred tax assets: Allowance for doubtful accounts $ 112 $ 101 Accrued vacation and bonuses 419 457 Stock-based compensation expense 1,274 738 COVID-19 628 1,207 Acquisition-related transaction costs 540 515 Net operating losses 311 179 Total deferred tax assets 3,284 3,197 Deferred tax liabilities: Prepaid expenses 233 217 Depreciation, intangibles and contingent consideration 3,005 2,005 Total deferred tax liabilities 3,238 2,222 Valuation allowance (311 ) (179 ) Net deferred tax asset (liability) $ (265 ) $ 796 A reconciliation of the beginning and ending amounts of unrecognized tax benefits related to uncertain tax positions, including interest and penalties, for the three years ended December 31, 2021 is as follows: Years Ended December 31, (Amounts in thousands) 2021 2020 2019 Unrecognized tax benefits, beginning balance $ — $ 20 $ 263 Additions related to current period — — — Additions related to prior periods — — — Reductions related to prior periods — (20 ) (243 ) Unrecognized tax benefits, ending balance $ — $ — $ 20 We evaluate deferred income taxes quarterly to determine if valuation allowances are required or should be adjusted. GAAP accounting guidance requires us to assess whether valuation allowances should be established against deferred tax assets based on all available evidence, both positive and negative using a “more likely than not” standard. Our assessment considers, among other things, the nature of cumulative losses; forecast of future profitability; the duration of statutory carry-forward periods and tax planning alternatives. At December 31, 2021, our valuation allowance was comprised of balances within locations of Singapore and the United Kingdom. The valuation allowance balances at these locations totaled $311,000 and $179,000 as of December 31, 2021 and 2020, respectively, and reflect net operating losses which may not be realizable in the future. The IRS’s audit of the Company’s 2018 tax return was completed in the third quarter of 2021 with no adjustments to our original filing. The Company’s Canadian subsidiary for years 2018 and 2019 are currently under audit. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | 13. Derivative Instruments and Hedging Activities Interest Rate Risk Management Concurrent with the Company’s July 13, 2017 borrowings under its new credit facility, the Company entered into a 44–month interest-rate swap to convert the debt’s variable interest rate to a fixed rate of interest. 70 Under the swap contracts, which matured on April 1, 2021, the Company paid interest at a fixed rate of 1.99% and received interest at a variable rate equal to the daily U.S. LIBOR on an initial notional amount of $15.0 million. Notional amounts were $0 and $8.1 million at December 31, 2021 and December 31, 2020, respectively. These swap contracts have been designated as cash flow hedging instruments and qualified as effective hedges at inception under ASC Topic 815, “Derivatives and Hedging”. These contracts are recognized on the balance sheet at fair value. The effective portion of the changes in fair value on these instruments is recorded in other comprehensive income (loss) and is reclassified into the Consolidated Statements of Operations as interest expense in the same period in which the underlying hedge transaction affects earnings. Changes in the fair value of interest-rate swap contracts deemed ineffective are recognized in the Consolidated Statements of Operations as interest expense. The fair value of the interest-rate swap contracts at December 31, 2021 and December 31, 2020 was $0 and a liability of $35,000, respectively, and is reflected in the Consolidated Balance Sheets as other current liabilities. The effect of derivative instruments on the Consolidated Statements of Operations and Comprehensive Income (“OCI”) for the year ended December 31, 2021 (in thousands): Derivatives in ASC Topic 815 Cash Flow Hedging Relationships Amount of Location of Amount of Location of Amount of (Effective Portion) (Effective Portion) (Effective Portion) (Ineffective Portion/Amounts excluded Interest-Rate Swap Contracts $35 Interest Expense $34 Interest Expense $— The effect of derivative instruments on the Consolidated Statements of Operations and Comprehensive Income (“OCI”) for the year ended December 31, 2020 (in thousands): Derivatives in ASC Topic 815 Cash Flow Hedging Relationships Amount of Location of Amount of Location of Amount of (Effective Portion) (Effective Portion) (Effective Portion) (Ineffective Portion/Amounts excluded Interest-Rate Swap Contracts $8 Interest Expense $121 Interest Expense $— Information on the location and amounts of derivative fair values in the Consolidated Balance Sheets (in thousands): December 31, 2021 December 31, 2020 Derivative Instruments Balance Sheet Location Fair Value Balance Sheet Location Fair Value Interest-Rate Swap Contracts Other Current Liabilities $ — Other Current Liabilities $ 35 The estimated amount of pretax income as of December 31, 2021 that is expected to be reclassified from other comprehensive income into earnings within the next 12 months is $0. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Shareholders' Equity | 14. Shareholders’ Equity The Company did not purchase any shares in 2021 and 2020 to satisfy employee tax obligations related to its Stock Incentive Plan. |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per Share | 15. Earnings per Share The computation of basic earnings per share (“EPS”) is based on the Company’s net income divided by the weighted average number of common shares outstanding. Diluted earnings per share reflects the potential dilution that could occur if outstanding stock options and restricted share units were exercised / released. The dilutive effect of stock options and restricted share units were calculated using the treasury stock method. For the years ended December 31, 2021, 2020 and 2019, there were 276,000, 0 and 518,000 anti-dilutive stock options that were excluded from the computation of diluted earnings per share, respectively. The following table sets forth the denominators of the basic and diluted EPS computations: Years Ended December 31, (Amounts in thousands) 2021 2020 2019 Weighted-average shares outstanding: Basic 11,436 11,292 11,029 Stock options and restricted share units 571 658 203 Diluted 12,007 11,950 11,232 The following table sets forth the computation of basic EPS utilizing net income and the Company’s weighted-average common stock outstanding: Years Ended December 31, (Amounts in thousands, except per share data) 2021 2020 2019 Net income $ 12,221 $ 9,861 $ 11,145 Basic weighted-average shares outstanding 11,436 11,292 11,029 Basic EPS $ 1.07 $ .87 $ 1.01 The following table sets forth the computation of diluted EPS utilizing net income and the Company’s weighted-average common stock outstanding plus the weighted-average of stock options, restricted shares and performance shares: Years Ended December 31, (Amounts in thousands, except per share data) 2021 2020 2019 Net income $ 12,221 $ 9,861 $ 11,145 Diluted weighted-average shares outstanding 12,007 11,950 11,232 Diluted EPS $ 1.02 $ .83 $ .99 |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2021 | |
Text Block [Abstract] | |
Other comprehensive income (loss) | 16. Other Comprehensive Income (Loss) The changes in accumulated other comprehensive income (loss) for the years ended December 31, 2021, 2020 and 2019 were as follows: Foreign Derivative Total (in thousands) Balance at December 31, 2018 $ (197 ) $ 78 $ (119 ) (Loss) arising during the period (129 ) (181 ) (310 ) Reclassification to earnings for gains realized — 32 32 Income tax benefit — 39 39 Net other comprehensive (loss) – year 2019 (129 ) (110 ) (239 ) Balance at December 31, 2019 $ (326 ) $ (32 ) $ (358 ) (Loss) arising during the period (187 ) (113 ) (300 ) Reclassification to earnings for gains realized — 121 121 Income tax (expense) — (2 ) (2 ) Net other comprehensive income (loss) – year 2020 (187 ) 6 (181 ) Balance at December 31, 2020 $ (513 ) $ (26 ) $ (539 ) Gain (Loss) arising during the period (94 ) 1 (93 ) Reclassification to earnings for gains realized — 34 34 Income tax (expense) — (9 ) (9 ) Net other comprehensive income (loss) – year 2021 (94 ) 26 (68 ) Balance at December 31, 2021 $ (607 ) $ — $ (607 ) Generally, the assets and liabilities of foreign operations are translated into U.S. dollars using the current exchange rate. For those operations, changes in exchange rates generally do not affect cash flows; therefore, resulting translation adjustments are made in shareholders’ equity rather than in net income. See Note 13 for information regarding hedging activities. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 17. Fair Value Measurements The Company has adopted the provisions of ASC 820, “ Fair Value Measurements and Disclosures • Level 1 – Inputs are observable quoted prices (unadjusted) in active markets for identical assets and liabilities. • Level 2 – Inputs are observable, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are directly or indirectly observable in the marketplace. • Level 3 – Inputs are unobservable that are supported by little or no market activity. The following table summarizes the basis used to measure financial assets and (liabilities) at fair value on a recurring basis: Fair Value as of December 31, 2021 (Amounts in thousands) Level 1 Level 2 Level 3 Total Interest-Rate Swap Contracts $ — $ — $ — $ — Contingent consideration liabilities $ — $ — $ — $ — Fair Value as of December 31, 2020 (Amounts in thousands) Level 1 Level 2 Level 3 Total Interest-Rate Swap Contracts $ — $ (35 ) $ — $ (35 ) Contingent consideration liabilities $ — $ — $ (2,882 ) $ (2,882 ) The fair value of interest rate swap contracts is based on quoted prices for similar instruments from a commercial bank, and therefore, the fair value measurement is considered to be within Level 2. The fair value of the contingent consideration liability was estimated by utilizing a probability weighted simulation model to determine the fair value of contingent consideration, and therefore, the fair value measurement is considered to be within Level 3. In 2020, the Company incurred a $2.9 million contingent consideration liability related to the AmberLeaf acquisition. In 2021 and 2019, the Company revalued the contingent consideration liability related to the AmberLeaf and InfoTrellis acquisitions after determining that relevant conditions for payment of such liabilities were not satisfied. The revaluation resulted in a $2.9 million and $6.1 million reduction to the contingent consideration liability in 2021 and 2019, respectively, which is reflected in selling and administrative expenses in the Company’s Consolidated Statements of Operations, in Item 8 herein. The following table provides information regarding changes in the Company’s Level 3 fair values for the contingent consideration liability for the three years ended December 31, 2021: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Beginning balance $ 2,882 $ — $ 6,069 Contingent consideration incurred 0 2,882 — Payments made — — — Revaluation (2,882 ) — (6,069 ) Ending balance $ — $ 2,882 $ — |
Business Segments and Geographi
Business Segments and Geographic Information | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Business Segments and Geographic Information | 18. Business Segments and Geographic Information Our reporting segments are: 1) Data and Analytics Services; and 2) IT Staffing Services. The Data and Analytics Services segment was acquired through the July 13, 2017 acquisition of the services division of Canada-based InfoTrellis, Inc. This segment is a project-based consulting services business with specialized capabilities in data management and analytics. The business is marketed as Mastech InfoTrellis and utilizes a dedicated sales team with deep subject matter expertise. Mastech InfoTrellis has offices in Atlanta, Toronto, London, Dublin and Singapore, and a global delivery center in Chennai, India. Project-based delivery reflects a combination of on-site consulting firm. This acquisition expands our capabilities in customer experience strategy and managed services offering for a variety of Cloud-based enterprise application across sales, marketing and customer service organizations. The IT Staffing Services segment offers staffing services in digital and mainstream technologies and uses digital methods to enhance organizational learning. These services are marketed using a common sales force and delivered via our domestic and global recruitment centers. While the vast majority of our assignments are based on time and materials, we do have the capabilities to deliver our digital learning services on a fixed price basis. Below are the operating results of our reporting segments: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Revenues: Data and Analytics Services $ 38,339 $ 30,226 $ 26,663 IT Staffing Services 183,673 163,875 166,911 Total revenues $ 222,012 $ 194,101 $ 193,574 Gross Margin %: Data and Analytics Services 48.4 % 50.5 % 46.7 % IT Staffing Services 22.3 % 22.1 % 21.3 % Total gross margin % 26.8 % 26.6 % 24.8 % Segment operating income: Data and Analytics Services $ 5,310 $ 5,455 $ 5,495 IT Staffing Services 12,728 11,388 8,001 Subtotal 18,038 16,843 13,496 Amortization of acquired intangible assets (3,170 ) (2,790 ) (2,688 ) Revaluation of contingent consideration liability 2,882 — 6,069 Acquisition-related transaction expenses (140 ) (650 ) 110 Interest expenses and other, net (724 ) (770 ) (1,768 ) Income before income taxes $ 16,886 $ 12,633 $ 15,219 Below is a reconciliation of total assets, depreciation and amortization and capital expenditures by segment: Total Assets Depreciation & Amortization Capital Expenditures Amounts in thousands 2021 2020 2019 2021 2020 2019 2021 2020 2019 Data and Analytics Services $ 56,634 $ 55,792 $ 41,527 $ 2,662 $ 2,245 $ 2,078 $ 1,692 $ 193 $ 203 IT Staffing Services 57,068 46,254 49,057 1,317 1,344 1,356 203 105 811 Total $ 113,702 $ 102,046 $ 90,584 $ 3,979 $ 3,589 $ 3,434 $ 1,895 $ 298 $ 1,014 Below is geographic information related to our revenues from external customers and fixed assets, net (equipment, enterprise software and leasehold improvements): Revenues Equipment, Enterprise Amounts in thousands 2021 2020 2019 2021 2020 2019 United States $ 212,356 $ 189,890 $ 188,710 $ 2,221 $ 1,613 $ 2,095 Canada 6,566 3,603 2,918 2 7 8 India and Other 3,090 608 1,946 815 351 373 Total $ 222,012 $ 194,101 $ 193,574 $ 3,038 $ 1,971 $ 2,476 75 |
Related-Party Transaction
Related-Party Transaction | 12 Months Ended |
Dec. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related-Party Transaction | 19. Related-Party Transaction During the third quarter of 2021, we purchased cybersecurity software licenses from CrowdStrike, Inc. for $98,000. One of our Board members is a Board member of CrowdStrike Inc. The purchase was completed as an arm’s length transaction. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation References in this Annual Report on Form 10-K |
Description of Business | Description of Business We are a provider of Digital Transformation IT Services to mostly large and medium-sized Our portfolio of offerings includes data management and analytics services; digital learning services; and IT staffing services. Reflective of our 2017 acquisition of the services division of Canada-based InfoTrellis, Inc., we have added specialized capabilities in delivering data and analytics services to our customers globally. This business offers project-based consulting services in the areas of data management, data engineering and data science, with such services delivered using on-site Our IT staffing business combines technical expertise with business process experience to deliver a broad range of staffing services in digital and mainstream technologies. Our digital technologies include data management, analytics, cloud, mobility, social and artificial intelligence. We work with businesses and institutions with significant IT spending and recurring staffing service needs. We also support smaller organizations with their “project focused” temporary IT staffing requirements. The COVID-19 roll-out COVID-19 COVID-19 |
Accounting Principles | Accounting Principles The Company’s Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). |
Principles of Consolidation | Principles of Consolidation The Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results could differ from these estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are defined as cash and highly liquid debt investments with maturities of three months or less when purchased. Cash equivalents are stated at cost, which approximates market value. |
Accounts Receivable and Unbilled Receivables | Accounts Receivable and Unbilled Receivables The Company extends credit to clients based upon management’s assessment of their creditworthiness. A substantial portion of the Company’s revenue, and the resulting accounts receivable, are from Fortune 1000 companies, major systems integrators and other staffing organizations. The Company does not generally charge interest on delinquent accounts receivable. Unbilled receivables represent amounts recognized as revenues based on services performed and, in accordance with the terms of the client contract, will be invoiced in a subsequent period. See Note 2 “Revenue from Contracts with Customers” for further details. |
Allowance for Uncollectible Accounts | Allowance for Uncollectible Accounts Accounts receivable are reviewed periodically to determine the probability of loss. The Company records an allowance for uncollectible accounts when it is probable that the related receivable balance will not be collected based on historical collection experience, client-specific collection issues, and other matters the Company identifies in its collection monitoring. The Allowance for Uncollectible Accounts was $375,000 and $413,000 at December 31, 2021 and 2020, respectively. There were $130,000, $0 and $80,000 of bad debt expense charges for the years ended December 31, 2021, 2020 and 2019, respectively, which amounts are reflected in the Consolidated Statements of Operations. |
Equipment, Enterprise Software and Leasehold Improvements | Equipment, Enterprise Software and Leasehold Improvements Equipment, enterprise software and leasehold improvements are stated at historical cost. The Company provides for depreciation using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of (a) the remaining term of the lease or (b) the estimated useful life of the improvements. Repairs and maintenance, which do not extend the useful life of the respective assets, are charged to expense as incurred. Upon disposal, assets and related accumulated depreciation are removed from the Company’s accounts and the resulting gains or losses are reflected in the Company’s Consolidated Statement of Operations. The estimated useful lives of depreciable assets are primarily as follows: Laptop Computers 18 months Equipment 3- 5 Enterprise Software 3- 5 The Company capitalizes certain external and internal computer software and software development costs incurred during the application development stage. The application development stage generally includes software design and configuration, coding, testing and installation activities. Capitalized costs include only external direct cost of material and services consumed in developing or obtaining internal-use internal-use The Company implemented new enterprise software applications to its backbone systems environment. The Company has capitalized $2.4 million related to this endeavor for which the core system was placed in service on July 1, 2018. The Company started amortizing these costs commencing with this go-live Depreciation and amortization expense related to fixed assets totaled $809,000, $799,000 and $746,000 for the years ended December 31, 2021, 2020 and 2019, respectively. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Identifiable intangible assets are recorded at fair value as of the closing date when acquired in a business combination. Identifiable intangible assets related to acquisitions consisted of client relationships, covenants not-to-compete, Excess purchase price over the fair value of net tangible assets and identifiable intangible assets acquired are recorded as goodwill. Goodwill is not amortized but is tested for impairment at least on an annual basis. If impairment is indicated, a write-down to fair value is recorded based on the excess of the carrying value of the reporting unit over its fair market value. We review goodwill and intangible assets for impairment annually as of October 1 st In conducting our annual impairment testing, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not (more than 50%) that the estimated fair value of a reporting unit is less than its carrying amount. If not, no further goodwill impairment testing is required. If it is more likely than not that a reporting unit’s fair value is less than its carrying amount, we are then required to perform a quantitative impairment test. We also may elect not to perform the qualitative assessment, and instead, proceed directly to the quantitative impairment test. In 2021, 2020 and 2019, we performed quantitative impairment tests related to our June 2015 acquisition of Hudson Global Resources Management, Inc.’s U.S. IT staffing business (“Hudson IT”). The results of each of these testing’s indicated no impairment associated with the carrying amount of goodwill. Additionally in 2021, 2020 and 2019, we performed quantitative impairment tests related to our Data and Analytics segment which includes the July 2017 acquisition of InfoTrellis and the October 2020 acquisition of AmberLeaf. The results of each of these testing’s indicated no impairment associated with the carrying amount of goodwill. |
Business Combinations | Business Combinations The Company accounts for acquisitions in accordance with guidance found in ASC 805, Business Combinations (1) in-process indefinite-lived intangible asset; (2) acquisition-related transaction costs will generally be expensed as incurred; (3) restructuring costs associated with a business combination will generally be expensed subsequent to the acquisition date; and (4) changes in deferred tax asset valuation allowances and income tax uncertainties after the acquisition date generally will effect income tax expense. ASC 805 requires that any excess purchase price over fair value of assets acquired (including identifiable intangibles) and liabilities assumed be recognized as goodwill. Additionally, any excess fair value of acquired net assets over acquisition consideration results in a bargain purchase gain. Prior to recording a gain, the acquiring entity must reassess whether all acquired assets and assumed liabilities have been identified and must perform re-measurements The AmberLeaf financial results are included in the Company’s Consolidated Financial Statements from the date of the acquisition of October 1, 2020. |
Leases | Leases Leases Right-of-use |
Income Taxes | Income Taxes The Company records an estimated liability for income and other taxes based on what management determines will likely be paid in the various tax jurisdictions in which we operate. Management uses its best judgment in the determination of these amounts. However, the liabilities ultimately realized and paid are dependent on various matters, including the resolution of the tax audits in the various affected tax jurisdictions, and may differ from the amounts recorded. An adjustment to the estimated liability would be recorded through income in the period in which it becomes probable that the amount of the actual liability differs from the amount recorded. Management determines the Company’s income tax provision using the asset and liability method. Under this method, deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of the Company’s assets and liabilities. The Company measures deferred tax assets and liabilities using enacted tax rates in effect for the year in which we expect to recover or settle the temporary differences. The effect of a change in tax rates on deferred taxes is recognized in the period that the change is enacted. The Company evaluates its deferred tax assets and records a valuation allowance when, in management’s opinion, it is more likely than not that some portion or all of the deferred tax assets will not be realized. As of December 31, 2021 and 2020, the Company provided a valuation allowance of $311,000 and $179,000, respectively, related to the uncertainty of the realization of foreign net operating losses (“NOL”). The Tax Cuts and Jobs Act of 2017 (“TCJA”) created a new requirement that certain income earned by foreign subsidiaries, known as global intangible low-tax The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, Accounting for Uncertainty in Income Taxes The Company’s 2018 federal income tax return was audited by the Internal Revenue Service (“IRS”) in 2021 with no adjustment to our original filing. In 2019, the Company and the IRS agreed to certain adjustments related to the Company’s 2015 and 2016 income tax returns. The impact of this settlement on the Company’s tax provision in 2019 was not material. |
Deferred Financing Costs | Deferred Financing Costs The Company capitalizes expenses directly related to securing its credit facilities. These deferred costs are amortized as interest expense over the term of the underlying facilities. Unamortized deferred financing costs are included as reductions in the long-term debt in the Consolidated Balance Sheets. Contingent Consideration Liability |
Contingent Consideration Liability | In connection with the AmberLeaf acquisition, the Company has an obligation to pay consideration that is contingent upon the achievement of specified revenue growth and EBITA margin objectives. As of the acquisition date, the Company recorded a contingent consideration liability of $2.9 million representing the estimated fair value of the contingent consideration that is expected to be paid. The fair value of the contingent consideration liability was estimated by utilizing a probability weighted simulation model to determine the fair value of contingent consideration. In connection with the InfoTrellis acquisition, the Company had an obligation to pay consideration that was contingent upon the achievement of specified earnings before interest and taxes objectives (“EBIT”). As of the acquisition date, the Company recorded a contingent consideration liability representing the estimated fair value of the contingent consideration that was expected to be paid. The fair value of the contingent consideration liability was estimated by utilizing a probability weighted simulation model to determine the fair value of contingent consideration. We re-measured In 2021, the Company revalued the contingent consideration liability related to the AmberLeaf acquisition after determining that relevant conditions for payment of such liability were likely not to be satisfied. The revaluation resulted in a $2.9 million reduction in the contingent consideration liability. In 2019, the Company revalued the contingent consideration liability of the InfoTrellis acquisition after determining that relevant conditions for payment of such liability were not satisfied. The revaluation resulted in a $6.1 million reduction to the contingent consideration liability. No contingent consideration revaluation was recorded in 2020. Both of these credits are reflected in selling, general and administrative expenses in the Company’s Consolidated Statements of Operations, in Item 8, herein. No contingent consideration liability remained outstanding as of December 31, 2021. |
Segment Reporting | Segment Reporting The Company has two |
Revenue Recognition | Revenue Recognition The Company recognizes revenue on time-and-material Time-and-material out-of-pocket Out-of-pocket The Company recognizes revenue on fixed price contracts over time as services are rendered and uses a cost-based input method to measure progress. Determining a measure of progress requires management to make judgments that affect the timing of recognizing revenue. Under the cost-based input method, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues, including estimated fees or profits, are recorded proportionally as costs are incurred. The Company has determined that the cost-based input method provides a faithful depiction of the transfer of goods or services to the customer. Estimated losses are recognized immediately in the period in which current estimates indicate a loss. We record deferred revenues when cash payments are received or due in advance of our performance, including amounts which may be refundable. The Company’s time-and-material In certain situations related to client direct hire assignments, where the Company’s fee is contingent upon the hired resources’ continued employment with the client, revenue is not fully recognized until such employment conditions are satisfied. |
Stock-Based Compensation | Stock-Based Compensation Effective October 1, 2008, the Company adopted a Stock Incentive Plan (the “Plan”) which, as amended, provides that up to 4,900,000 shares (adjusted for the 2018 two-for-one three In October 2018, the Board of Directors of the Company approved the Mastech Digital, Inc. 2019 Employee Stock Purchase Plan (the “Stock Purchase Plan”). The Stock Purchase Plan is intended to meet the requirements of Section 423 of the Code and required the approval of the Company’s shareholders to be qualified under Section 423 of the Code. On May 15, 2019, the Company’s shareholders approved the Stock Purchase Plan. Under the Stock Purchase Plan, 600,000 shares of Common Stock (subject to adjustment upon certain changes in the Company’s capitalization) are available for purchase by eligible employees who become participants in the Stock Purchase Plan. The purchase price per share is 85% of the lesser of (1) the fair market value per share of Common Stock on the first day of the offering period, or (ii) the fair market value per share of Common Stock on the last day of the offering period. The Company accounts for stock-based compensation expense in accordance with ASC Topic 718 “ Share-based Payments |
Treasury Stock | Treasury Stock The Company maintained a stock repurchase program which expired on December 22, 2016. Under the program, the Company made treasury stock purchases in the open market, subject to market conditions and normal trading restrictions. Upon expiration, the program was not extended by the Company’s Board of Directors. Additionally, the Company makes stock purchases from time to time to satisfy employee tax obligations related to its Stock Incentive Plan. At December 31, 2021 and 2020, the Company held 1.6 million shares in its treasury at a cost of approximately $4.2 million. |
Comprehensive Income | Comprehensive Income Comprehensive income as presented in the Consolidated Statements of Comprehensive Income consists of net income, unrealized gains or losses, net of tax, on cash flow hedging transactions and foreign currency translation adjustments. |
Derivative Instruments and Hedging Activities - Interest Rate Swap Contracts | Derivative Instruments and Hedging Activities – Interest Rate Swap Contracts Concurrent with the Company’s borrowings on July 13, 2017 under its new credit facility, the Company entered into an interest-rate swap to convert the debt’s variable interest rate to a fixed rate of interest. These swap contracts, which matured on April 1, 2021, have been designated as cash flow hedging instruments and qualified as effective hedges at inception under ASC Topic 815, “Derivatives and Hedging”. These contracts are recognized on the balance sheet at fair value. The effective portion of the changes in fair value on these contracts is recorded in other comprehensive income (loss) and is reclassified into the Consolidated Statements of Operations as interest expense in the same period in which the underlying transaction affects earnings. With respect to derivatives designated as hedges, the Company formally documents all relationships between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking such transactions. The Company evaluates hedge effectiveness at the time a contract is entered into and on an ongoing basis. If a swap contract is deemed ineffective, the change in the fair value of the derivative is recorded in the Consolidated Statement of Operations as interest expense. |
Foreign Currency Translation | Foreign Currency Translation The reporting currency of the Company and its subsidiaries is the U.S. dollar. The functional currency of the Company’s subsidiary in Canada is the U.S. dollar because the majority of its revenue is denominated in U.S. dollars. The functional currency of the Company’s Indian and European subsidiaries is their local currency. The results of operations of the Company’s Indian and European subsidiaries are translated at the monthly average exchange rates prevailing during the period. The financial position of the Company’s Indian and European subsidiaries is translated at the current exchange rates at the end of the period, and the related translation adjustments are recorded as a component of accumulated other comprehensive income (loss) within Shareholders’ Equity. Gains and losses resulting from foreign currency transactions are included as a component of other income (expense), net in the Consolidated Statements of Operations, and have not been material for all periods presented. |
Earnings Per Share | Earnings Per Share Basic earnings per share are computed using the weighted-average number of common shares outstanding during the period. Diluted earnings per share are computed using the weighted-average number of common shares outstanding during the period, plus the incremental shares outstanding assuming the exercise of dilutive stock options and the vesting of restricted shares and performance shares, calculated using the treasury stock method. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, In March 2020, the FASB issued ASU 2020-04, Recent Accounting Pronouncements not yet adopted In October 2021, the FASB issued ASU 2021-08, In November 2021, the FASB issued ASU 2021-10, A variety of proposed or otherwise potential accounting standards are currently under consideration by standard-setting organizations and certain regulatory agencies. Because of the tentative and preliminary nature of such proposed standards, management has not yet determined the effect, if any that the implementation of such proposed standards would have on the Company’s consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Accounting Policies [Abstract] | |
Estimated Useful Lives of Depreciable Assets | The estimated useful lives of depreciable assets are primarily as follows: Laptop Computers 18 months Equipment 3- 5 Enterprise Software 3- 5 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Summary of Disaggregation of Our Revenues by Contract Type and Operating Segment | The following table depicts the disaggregation of our revenues by contract type and operating segment: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Data and Analytics Services Segment Time-and-material $ 25,224 $ 18,541 $ 18,732 Fixed-price Contracts 13,115 11,685 7,931 Subtotal Data and Analytics Services $ 38,339 $ 30,226 $ 26,663 IT Staffing Services Segment Time-and-material $ 183,673 $ 163,875 $ 166,911 Fixed-price Contracts — — — Subtotal IT Staffing Services $ 183,673 $ 163,875 $ 166,911 Total Revenues $ 222,012 $ 194,101 $ 193,574 |
Summary of Revenue from External Customers | The following table presents our revenue from external customers disaggregated by geography, based on the work location of our customers: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) United States $ 214,379 $ 189,890 $ 188,710 Canada 4,543 3,603 2,918 India and Other 3,090 608 1,946 Total $ 222,012 $ 194,101 $ 193,574 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Business Combinations [Abstract] | |
Summary of Fair Value of Consideration for Acquired Business | The following table summarizes the fair value of consideration for the acquired business on the October 1, 2020 closing date: (in thousands) Amounts Cash purchase price at closing $ 9,664 Working capital adjustments — Estimated payout of contingent consideration (1) 2,882 Total Fair Value of Consideration $ 12,546 (1) Based on a valuation conducted by an independent third party, the fair value of contingent consideration at the closing date was determined to be $2.9 million During 2021, the Company revalued the contingent conside rati |
Schedule of Sources of Funds in Business Acquisition | The cash purchase price at closing was paid with funds obtained from the following sources: (in thousands) Amounts Cash balances on hand $ — Increase in term loan debt facility 10,000 Revolving line of credit (336 ) Cash Paid at Closing $ 9,664 |
Schedule of Fair Value of Net Assets Acquired | The valuation of net assets acquired is as follows: (in thousands) Amounts Cash on hand $ 319 Working capital assets, net of liabilities 1,153 Identifiable intangible assets: Client relationships 2,970 Covenant not-to-compete 440 Trade name 490 Technology 770 Total identifiable intangible assets 4,670 Goodwill 6,404 Net Assets Acquired $ 12,546 |
Summary of Unaudited Pro Forma Results | The following reflects the Company’s unaudited pro forma results had the results of AmberLeaf been included from January 1, 2018 for all periods presented: Years Ended December 31, 2021 2020 2019 (Amounts in thousands, except per share data) Revenue $ 222,012 $ 202,842 $ 204,846 Net income $ 12,221 $ 10,594 $ 12,119 Earnings per share—diluted $ 1.02 $ .89 $ 1.08 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets, net (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Reconciliation of Goodwill | A reconciliation of the beginning and ending amounts of goodwill by operating segment for the three years ended December 31, 2021 is as follows: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) IT Staffing Services: Beginning balance $ 8,427 $ 8,427 $ 8,427 Goodwill recorded — — — Impairment — — — Ending balance $ 8,427 $ 8,427 $ 8,427 Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Data and Analytics Services: Beginning balance $ 24,083 $ 17,679 $ 17,679 Goodwill recorded — 6,404 — Impairment — — — Ending balance $ 24,083 $ 24,083 $ 17,679 |
Components of Identifiable Intangible assets | The Company is amortizing the identifiable intangible assets on a straight-line basis over estimated average lives ranging from 3 to 12 years. Identifiable intangible assets were comprised of the following as of December 31, 2021 and 2020: As of December 31, 2021 (Amounts in thousands) Amortization Gross Carrying Accumulative Net Carrying IT Staffing Services: Client relationships 12 $ 7,999 $ 4,361 $ 3,638 Covenant-not-to-compete 5 319 319 — Trade name 3 249 249 — Data and Analytics Services: Client relationships 12 19,641 6,503 13,138 Covenant-not-to-compete 5 1,201 788 413 Trade name 5 1,711 1,211 500 Technology 7 1,979 908 1,071 Total Intangible Assets $ 33,099 $ 14,339 $ 18,760 As of December 31, 2020 (Amounts in thousands) Amortization Gross Carrying Accumulative Net Carrying IT Staffing Services: Client relationships 12 $ 7,999 $ 3,694 $ 4,305 Covenant-not-to-compete 5 319 319 — Trade name 3 249 249 — Data and Analytics Services: Client relationships 12 19,641 4,866 14,775 Covenant-not-to-compete 5 1,201 548 653 Trade name 5 1,711 869 842 Technology 7 1,979 624 1,355 Total Intangible Assets $ 33,099 $ 11,169 $ 21,930 |
Schedule of Estimated Amortization Expense | The estimated aggregate amortization expense for intangible assets for the years ending December 31, 2022 through 2026 is as follows: Years Ended December 31, 2022 2023 2024 2025 2026 (Amounts in thousands) Amortization expense $ 2,987 $ 2,772 $ 2,693 $ 2,553 $ 2,413 61 |
Credit Facility (Tables)
Credit Facility (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Text Block [Abstract] | |
Schedule of Annual Aggregate Outstanding Debt | As of December 31, 2021, the annual aggregate maturities of our outstanding debt (exclusive of deferred financing costs amortization) during each of the next five years are as follows: Total Amount (Amounts in thousands) 2022 $ 4,400 2023 4,400 2024 4,300 2025 — 2026 — Total $ 13,100 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Summary of Balance Sheet classification of lease assets and related lease liabilities | The following table summarizes the balance sheet classification of the lease assets and related lease liabilities: December 31, 2021 December 31, 2020 ( in thousands) Assets: Long-term operating lease right-of-use $ 4,894 $ 3,286 Liabilities: Short-term operating lease liability $ 1,479 $ 1,079 Long-term operating lease liability 3,706 2,325 Total Liabilities $ 5,185 $ 3,404 |
Schedule of Minimum Future Rental Payments | Future minimum rental payments for office facilities and equipment under the Company’s noncancelable operating leases are as follows: Amount as of ( in thousands) 2022 $ 1,687 2023 1,639 2024 899 2025 629 2026 612 Thereafter 144 Total $ 5,610 Less: Imputed interest (425 ) Present value of operating lease liabilities $ 5,185 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Company's Stock Option Activity | Following is a summary of the Company’s stock option activity for the three years ended December 31, 2021: Number of Weighted Average Outstanding at December 31, 2018 1,111,000 $ 4.95 Granted 683,000 6.48 Exercised (6,000 ) 1.18 Cancelled / forfeited (67,000 ) 6.35 Outstanding at December 31, 2019 1,721,000 5.52 Granted 800,000 15.49 Exercised (305,000 ) 4.36 Cancelled / forfeited (207,000 ) 8.04 Outstanding at December 31, 2020 2,009,000 9.40 Granted 501,000 17.58 Exercised (31,000 ) 7.34 Cancelled / forfeited (438,000 ) 13.04 Outstanding at December 31, 2021 2,041,000 $ 10.66 |
Summary of Information Regarding the Company's Outstanding and Exercisable Stock Options | Range of Exercise Prices: Options Weighted Average Weighted Average $0.01 to $4.00 355,000 4.2 $ 3.56 $4.01 to $8.00 717,000 7.0 6.68 $8.01 to $12.00 — — — $12.01 to $16.00 628,000 8.2 15.49 $16.01 to $20.00 341,000 9.6 17.55 2,041,000 7.3 $ 10.66 Range of Exercise Prices: Options Weighted Average Weighted Average $0.01 to $4.00 355,000 4.2 $ 3.56 $4.01 to $8.00 268,000 6.8 6.80 $8.01 to $12.00 — — — $12.01 to $16.00 123,000 8.2 15.49 $16.01 to $20.00 — — — 746,000 5.8 $ 6.69 |
Summary of Assumptions with Respect to the Black-Scholes Option Pricing Model | The Company used the following average assumptions with respect to the Black-Scholes option pricing model for Mastech Digital stock options issued during 2021, 2020 and 2019. Years Ended December 31, 2021 2020 2019 Stock option grants: Weighted-average risk-free interest rate 0.6 % 1.4 % 2.4 % Weighted-average dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 68.3 % 52.7 % 49.7 % Expected term (in years) 3.8 3.9 5.0 Weighted-average fair value $ 8.85 $ 6.36 $ 2.95 |
Summary of Mastech's Restricted Stock Unit Activity | Following is a summary of Mastech’s restricted stock activity for the three years ended December 31, 2021: Years Ended December 31, 2021 2020 2019 Beginning outstanding balance 30,843 33,285 34,380 Awarded 11,955 11,475 16,365 Released (17,739 ) (13,917 ) (17,460 ) Forfeited — — — Ending outstanding balance 25,059 30,843 33,285 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Components of Income Before Income Taxes | The components of income before income taxes as shown in the accompanying Consolidated Statement of Operations, consisted of the following for the years ended December 31, 2021, 2020 and 2019: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Income before income taxes: Domestic $ 17,117 $ 11,476 $ 6,787 Foreign (231 ) 1,157 8,432 Income before income taxes $ 16,886 $ 12,633 $ 15,219 |
Provision for Income Taxes | The provision for income taxes, as shown in the accompanying Consolidated Statement of Operations, consisted of the following for the years ended December 31, 2021, 2020 and 2019: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Current provision: Federal $ 2,657 $ 3,044 $ 1,555 State 713 752 406 Foreign 234 797 751 Total current provision 3,604 4,593 2,712 Deferred provision (benefit): Federal 873 (1,340 ) (13 ) State 233 (327 ) (4 ) Foreign (177 ) (326 ) 1,372 Total deferred provision (benefit) 929 (1,993 ) 1,355 Change in valuation allowance 132 172 7 Total provision for income taxes $ 4,665 $ 2,772 $ 4,074 |
Reconciliation of Income Taxes | The reconciliation of income taxes computed using our statutory U.S. income tax rate and the provision for income taxes for the years ended December 31, 2021, 2020 and 2019 were as follows: Years Ended December 31, (Amounts in thousands) 2021 2020 2019 Income taxes computed at the federal statutory rate $ 3,546 21.0 % $ 2,653 21.0 % $ 3,196 21.0 % State income taxes, net of federal tax benefit 962 5.7 602 4.7 404 2.7 Excess tax benefits from stock options/restricted shares (82 ) (0.5 ) (920 ) (7.3 ) (9 ) (0.1 ) Charge for global intangible low-taxed — — (20 ) (0.2 ) 69 0.5 Difference in tax rate on foreign earnings/other 107 0.6 285 2.3 407 2.7 Change in valuation allowance 132 0.8 172 1.4 7 — $ 4,665 27.6 % $ 2,772 21.9 % $ 4,074 26.8 % |
Components of Deferred Tax Assets and Liabilities | The components of the deferred tax assets and liabilities were as follows: At December 31, 2021 2020 (Amounts in thousands) Deferred tax assets: Allowance for doubtful accounts $ 112 $ 101 Accrued vacation and bonuses 419 457 Stock-based compensation expense 1,274 738 COVID-19 628 1,207 Acquisition-related transaction costs 540 515 Net operating losses 311 179 Total deferred tax assets 3,284 3,197 Deferred tax liabilities: Prepaid expenses 233 217 Depreciation, intangibles and contingent consideration 3,005 2,005 Total deferred tax liabilities 3,238 2,222 Valuation allowance (311 ) (179 ) Net deferred tax asset (liability) $ (265 ) $ 796 |
Unrecognized Tax Benefits Related to Uncertain Tax Positions | A reconciliation of the beginning and ending amounts of unrecognized tax benefits related to uncertain tax positions, including interest and penalties, for the three years ended December 31, 2021 is as follows: Years Ended December 31, (Amounts in thousands) 2021 2020 2019 Unrecognized tax benefits, beginning balance $ — $ 20 $ 263 Additions related to current period — — — Additions related to prior periods — — — Reductions related to prior periods — (20 ) (243 ) Unrecognized tax benefits, ending balance $ — $ — $ 20 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Effect of Derivative Instruments on Consolidated Statements of Operations and Comprehensive Income | The effect of derivative instruments on the Consolidated Statements of Operations and Comprehensive Income (“OCI”) for the year ended December 31, 2021 (in thousands): Derivatives in ASC Topic 815 Cash Flow Hedging Relationships Amount of Location of Amount of Location of Amount of (Effective Portion) (Effective Portion) (Effective Portion) (Ineffective Portion/Amounts excluded Interest-Rate Swap Contracts $35 Interest Expense $34 Interest Expense $— The effect of derivative instruments on the Consolidated Statements of Operations and Comprehensive Income (“OCI”) for the year ended December 31, 2020 (in thousands): Derivatives in ASC Topic 815 Cash Flow Hedging Relationships Amount of Location of Amount of Location of Amount of (Effective Portion) (Effective Portion) (Effective Portion) (Ineffective Portion/Amounts excluded Interest-Rate Swap Contracts $8 Interest Expense $121 Interest Expense $— |
Information on Location and Amounts of Derivative Fair Values in Consolidated Balance Sheets | Information on the location and amounts of derivative fair values in the Consolidated Balance Sheets (in thousands): December 31, 2021 December 31, 2020 Derivative Instruments Balance Sheet Location Fair Value Balance Sheet Location Fair Value Interest-Rate Swap Contracts Other Current Liabilities $ — Other Current Liabilities $ 35 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Denominators of Basic and Diluted EPS Computations | The following table sets forth the denominators of the basic and diluted EPS computations: Years Ended December 31, (Amounts in thousands) 2021 2020 2019 Weighted-average shares outstanding: Basic 11,436 11,292 11,029 Stock options and restricted share units 571 658 203 Diluted 12,007 11,950 11,232 |
Computation of Basic EPS | The following table sets forth the computation of basic EPS utilizing net income and the Company’s weighted-average common stock outstanding: Years Ended December 31, (Amounts in thousands, except per share data) 2021 2020 2019 Net income $ 12,221 $ 9,861 $ 11,145 Basic weighted-average shares outstanding 11,436 11,292 11,029 Basic EPS $ 1.07 $ .87 $ 1.01 |
Computation of Diluted EPS | The following table sets forth the computation of diluted EPS utilizing net income and the Company’s weighted-average common stock outstanding plus the weighted-average of stock options, restricted shares and performance shares: Years Ended December 31, (Amounts in thousands, except per share data) 2021 2020 2019 Net income $ 12,221 $ 9,861 $ 11,145 Diluted weighted-average shares outstanding 12,007 11,950 11,232 Diluted EPS $ 1.02 $ .83 $ .99 |
Other Comprehensive Income (L_2
Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Text Block [Abstract] | |
Summary of accumulated other comprehensive income (loss) | The changes in accumulated other comprehensive income (loss) for the years ended December 31, 2021, 2020 and 2019 were as follows: Foreign Derivative Total (in thousands) Balance at December 31, 2018 $ (197 ) $ 78 $ (119 ) (Loss) arising during the period (129 ) (181 ) (310 ) Reclassification to earnings for gains realized — 32 32 Income tax benefit — 39 39 Net other comprehensive (loss) – year 2019 (129 ) (110 ) (239 ) Balance at December 31, 2019 $ (326 ) $ (32 ) $ (358 ) (Loss) arising during the period (187 ) (113 ) (300 ) Reclassification to earnings for gains realized — 121 121 Income tax (expense) — (2 ) (2 ) Net other comprehensive income (loss) – year 2020 (187 ) 6 (181 ) Balance at December 31, 2020 $ (513 ) $ (26 ) $ (539 ) Gain (Loss) arising during the period (94 ) 1 (93 ) Reclassification to earnings for gains realized — 34 34 Income tax (expense) — (9 ) (9 ) Net other comprehensive income (loss) – year 2021 (94 ) 26 (68 ) Balance at December 31, 2021 $ (607 ) $ — $ (607 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Assets and (Liabilities) at Fair Value Measured on Recurring Basis | The following table summarizes the basis used to measure financial assets and (liabilities) at fair value on a recurring basis: Fair Value as of December 31, 2021 (Amounts in thousands) Level 1 Level 2 Level 3 Total Interest-Rate Swap Contracts $ — $ — $ — $ — Contingent consideration liabilities $ — $ — $ — $ — Fair Value as of December 31, 2020 (Amounts in thousands) Level 1 Level 2 Level 3 Total Interest-Rate Swap Contracts $ — $ (35 ) $ — $ (35 ) Contingent consideration liabilities $ — $ — $ (2,882 ) $ (2,882 ) |
Schedule of Changes in Contingent Consideration Liability | The following table provides information regarding changes in the Company’s Level 3 fair values for the contingent consideration liability for the three years ended December 31, 2021: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Beginning balance $ 2,882 $ — $ 6,069 Contingent consideration incurred 0 2,882 — Payments made — — — Revaluation (2,882 ) — (6,069 ) Ending balance $ — $ 2,882 $ — |
Business Segments and Geograp_2
Business Segments and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Summary of Operating Segments | Below are the operating results of our reporting segments: Years Ended December 31, 2021 2020 2019 (Amounts in thousands) Revenues: Data and Analytics Services $ 38,339 $ 30,226 $ 26,663 IT Staffing Services 183,673 163,875 166,911 Total revenues $ 222,012 $ 194,101 $ 193,574 Gross Margin %: Data and Analytics Services 48.4 % 50.5 % 46.7 % IT Staffing Services 22.3 % 22.1 % 21.3 % Total gross margin % 26.8 % 26.6 % 24.8 % Segment operating income: Data and Analytics Services $ 5,310 $ 5,455 $ 5,495 IT Staffing Services 12,728 11,388 8,001 Subtotal 18,038 16,843 13,496 Amortization of acquired intangible assets (3,170 ) (2,790 ) (2,688 ) Revaluation of contingent consideration liability 2,882 — 6,069 Acquisition-related transaction expenses (140 ) (650 ) 110 Interest expenses and other, net (724 ) (770 ) (1,768 ) Income before income taxes $ 16,886 $ 12,633 $ 15,219 |
Summary of Assets, Depreciation and Amortization and Capital Expenditures by Segment | Below is a reconciliation of total assets, depreciation and amortization and capital expenditures by segment: Total Assets Depreciation & Amortization Capital Expenditures Amounts in thousands 2021 2020 2019 2021 2020 2019 2021 2020 2019 Data and Analytics Services $ 56,634 $ 55,792 $ 41,527 $ 2,662 $ 2,245 $ 2,078 $ 1,692 $ 193 $ 203 IT Staffing Services 57,068 46,254 49,057 1,317 1,344 1,356 203 105 811 Total $ 113,702 $ 102,046 $ 90,584 $ 3,979 $ 3,589 $ 3,434 $ 1,895 $ 298 $ 1,014 |
Summary of Revenue from External Customers and Long-lived Assets | Below is geographic information related to our revenues from external customers and fixed assets, net (equipment, enterprise software and leasehold improvements): Revenues Equipment, Enterprise Amounts in thousands 2021 2020 2019 2021 2020 2019 United States $ 212,356 $ 189,890 $ 188,710 $ 2,221 $ 1,613 $ 2,095 Canada 6,566 3,603 2,918 2 7 8 India and Other 3,090 608 1,946 815 351 373 Total $ 222,012 $ 194,101 $ 193,574 $ 3,038 $ 1,971 $ 2,476 75 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | ||||
Dec. 31, 2021USD ($)Segmentshares | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($) | May 15, 2019shares | Jul. 01, 2018USD ($) | |
Significant Accounting Policies [Line Items] | |||||
Stock split description | two-for-one | ||||
Bad debt (credit) expense | $ 130,000 | $ 80,000 | |||
Number of reportable segment | Segment | 2 | ||||
Percentage of billing expense revenues | 2.00% | ||||
Stock Incentive Plan, shares available for issuance | shares | 4,900,000 | ||||
Treasury stock, shares | shares | 1,646,420 | 1,646,420 | |||
Treasury stock, at cost | $ 4,187,000 | $ 4,187,000 | |||
Expiration period of stock repurchase program | Dec. 22, 2016 | ||||
Allowance for uncollectible accounts | $ 375,000 | 413,000 | |||
Revaluation of contingent consideration liability | (2,882,000) | (6,069,000) | |||
Business combination contingent consideration liability | 0 | 2,882,000 | |||
Data And Analytics Segment [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Software development cost capitalized | $ 1,000,000 | ||||
Employee Stock Purchase Plan [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Shares available for future grants | shares | 515,549 | 600,000 | |||
Minimum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Vesting period | 3 years | ||||
Maximum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Vesting period | 5 years | ||||
Info Trellis Inc [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Bad debt (credit) expense | $ 130,000 | 0 | 80,000 | ||
Depreciation and amortization expense related to fixed assets | 809,000 | 799,000 | 746,000 | ||
Impairment on goodwill and intangible assets | 0 | ||||
Valuation allowance provided | 311,000 | 179,000 | |||
Uncertain tax positions | 0 | 0 | |||
Allowance for uncollectible accounts | 375,000 | 413,000 | |||
Revaluation of contingent consideration liability | $ 2,900,000 | 0 | $ 6,100,000 | ||
Info Trellis Inc [Member] | Enterprise Software [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Software development cost capitalized | $ 2,400,000 | ||||
Info Trellis Inc [Member] | Minimum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Estimated useful life, intangible assets | 3 years | ||||
Info Trellis Inc [Member] | Maximum [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Estimated useful life, intangible assets | 12 years | ||||
AmberLeaf [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Revaluation of contingent consideration liability | $ 2,900,000 | ||||
Business combination contingent consideration liability | $ 0 | $ 2,900,000 | |||
Accounting Standards Update 2014-09 [Member] | Info Trellis Inc [Member] | |||||
Significant Accounting Policies [Line Items] | |||||
Percentage of billing expense revenues | 2.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Estimated Useful Lives of Depreciable Assets (Detail) | 12 Months Ended |
Dec. 31, 2021 | |
Laptop Computers [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable assets | 18 months |
Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable assets | 3 years |
Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable assets | 5 years |
Enterprise Software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable assets | 3 years |
Enterprise Software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable assets | 5 years |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Additional Information (Detail) - Agreement | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Percentage of billing expense revenues | 2.00% | |||
Sales Revenue Net [Member] | Revenue from Rights Concentration Risk [Member] | CGI [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total accounts receivable | 15.00% | 15.00% | 11.30% | |
Number of customers | 1 | 1 | 1 | |
Accounts Receivable [Member] | Accounts Receivable Concentration Risk [Member] | CGI [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total accounts receivable | 19.50% | 11.70% | ||
Top Ten Customers [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue percentage of total revenue | 48.00% | 47.00% | 45.00% | |
Data and Analytics Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Percent of revenue from services | 100.00% |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Summary of Disaggregation of Our Revenues by Contract Type and Operating Segment (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Revenues by contract type and operating segment | $ 222,012 | $ 194,101 | $ 193,574 |
Data and Analytics Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues by contract type and operating segment | 38,339 | 30,226 | 26,663 |
Data and Analytics Services [Member] | Time-and-Material Contract [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues by contract type and operating segment | 25,224 | 18,541 | 18,732 |
Data and Analytics Services [Member] | Fixed-Price Contract [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues by contract type and operating segment | 13,115 | 11,685 | 7,931 |
IT Staffing Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues by contract type and operating segment | 183,673 | 163,875 | 166,911 |
IT Staffing Services [Member] | Time-and-Material Contract [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenues by contract type and operating segment | $ 183,673 | $ 163,875 | $ 166,911 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Summary of Revenue from External Customers (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue from External Customer [Line Items] | |||
Total | $ 222,012 | $ 194,101 | $ 193,574 |
United States [Member] | |||
Revenue from External Customer [Line Items] | |||
Total | 214,379 | 189,890 | 188,710 |
Canada [Member] | |||
Revenue from External Customer [Line Items] | |||
Total | 4,543 | 3,603 | 2,918 |
India and Other [Member] | |||
Revenue from External Customer [Line Items] | |||
Total | $ 3,090 | $ 608 | $ 1,946 |
Business Combinations - Additio
Business Combinations - Additional Information (Detail) - USD ($) | Oct. 01, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 04, 2022 |
Business Acquisition [Line Items] | |||||
Increase in Credit Facility | $ 15,000,000 | ||||
Revenues | $ 222,012,000 | $ 194,101,000 | $ 193,574,000 | ||
Net income (loss) | $ 12,221,000 | 9,861,000 | $ 11,145,000 | ||
Revolving Line of Credit [Member] | |||||
Business Acquisition [Line Items] | |||||
Credit agreement provides for total aggregate commitment | 30,000,000 | ||||
Term Loan Facility [Member] | |||||
Business Acquisition [Line Items] | |||||
Credit agreement provides for total aggregate commitment | 17,500,000 | $ 20,000,000 | |||
Maximum [Member] | Revolving Line of Credit [Member] | |||||
Business Acquisition [Line Items] | |||||
Increase in Credit Facility | 7,500,000 | ||||
Maximum [Member] | Term Loan Facility [Member] | |||||
Business Acquisition [Line Items] | |||||
Increase in Credit Facility | 10,000,000 | ||||
Amber Leaf Partners Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, description | On October 1, 2020, Mastech Digital, Inc., through its wholly-owned subsidiary Mastech Digital Data, Inc., acquired all of the outstanding shares of AmberLeaf Partners, Inc. (“AmberLeaf”). Under the terms of the Share Purchase Agreement executed in connection with the AmberLeaf acquisition (the “Purchase Agreement”) | ||||
Cash consideration | 9,664,000 | ||||
Contingent consideration in deferred cash payments | $ 4,500,000 | ||||
Transaction costs related to acquisition | $ 140,000,000 | 650,000 | |||
Write off of Deferred Finance Costs | 185,000 | ||||
Revenues | 2,400,000 | ||||
Net income (loss) | $ (400,000) |
Business Combinations - Summary
Business Combinations - Summary of Fair Value of Consideration for Acquired Business (Detail) - USD ($) $ in Thousands | Oct. 01, 2020 | Dec. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Estimated payout of contingent consideration | $ 0 | $ 2,882 | |
Amber Leaf Partners Inc [Member] | |||
Business Acquisition [Line Items] | |||
Cash purchase price at closing | $ 9,664 | ||
Working capital adjustments | |||
Estimated payout of contingent consideration | 2,882 | ||
Total Fair Value of Consideration | $ 12,546 |
Business Combinations - Summa_2
Business Combinations - Summary of Fair Value of Consideration for Acquired Business (Parenthetical) (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2020 | Oct. 01, 2020 | |
Business Acquisition [Line Items] | ||||
Fair value of contingent consideration | $ 0 | $ 2,882 | ||
Change in contingent consideration liability | (2,882) | $ (6,069) | ||
Amber Leaf Partners Inc [Member] | ||||
Business Acquisition [Line Items] | ||||
Fair value of contingent consideration | $ 2,882 | |||
Change in contingent consideration liability | $ (2,900) |
Business Combinations - Summa_3
Business Combinations - Summary of Source of Funds (Detail) $ in Thousands | Oct. 01, 2020USD ($) |
Business Acquisition [Line Items] | |
Increase in term loan debt facility | $ 15,000 |
Amber Leaf Partners Inc [Member] | |
Business Acquisition [Line Items] | |
Cash paid at Closing | 9,664 |
Amber Leaf Partners Inc [Member] | Term Loan Debt Facility [Member] | |
Business Acquisition [Line Items] | |
Increase in term loan debt facility | 10,000 |
Amber Leaf Partners Inc [Member] | Revolving Line of Credit [Member] | |
Business Acquisition [Line Items] | |
Revolving line of credit | $ (336) |
Business Combinations - Schedul
Business Combinations - Schedule of Valuation of Net Assets Acquired (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Oct. 01, 2020 |
Business Acquisition [Line Items] | |||
Cash on hand | $ 319 | ||
Working capital assets, net of liabilities | 1,153 | ||
Identifiable intangible assets: | |||
Identifiable intangible assets | 4,670 | ||
Goodwill | $ 32,510 | $ 32,510 | 6,404 |
Net Assets Acquired | 12,546 | ||
Client Relationships [Member] | |||
Identifiable intangible assets: | |||
Identifiable intangible assets | 2,970 | ||
Covenant Not-to-Compete [Member] | |||
Identifiable intangible assets: | |||
Identifiable intangible assets | 440 | ||
Trade Name [Member] | |||
Identifiable intangible assets: | |||
Identifiable intangible assets | 490 | ||
Technology [Member] | |||
Identifiable intangible assets: | |||
Identifiable intangible assets | $ 770 |
Business Combinations - Summa_4
Business Combinations - Summary of Unaudited Pro Forma Results (Detail) - Amber Leaf Partners Inc [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Business Acquisition [Line Items] | |||
Revenue | $ 222,012 | $ 202,842 | $ 204,846 |
Net income | $ 12,221 | $ 10,594 | $ 12,119 |
Earnings per share-diluted | $ 1.02 | $ 0.89 | $ 1.08 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets, net - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 01, 2020 | Jul. 13, 2017 | Jun. 15, 2015 | |
Goodwill and Intangible Assets [Line Items] | |||||||
Goodwill | $ 32,510 | $ 32,510 | $ 6,404 | ||||
Amortization expense | $ 3,170 | $ 2,790 | $ 2,688 | ||||
Hudson IT [Member] | |||||||
Goodwill and Intangible Assets [Line Items] | |||||||
Goodwill | $ 8,400 | ||||||
Info Trellis Inc [Member] | |||||||
Goodwill and Intangible Assets [Line Items] | |||||||
Goodwill | $ 27,400 | ||||||
Goodwill impairment | $ 9,700 | ||||||
Amber Leaf Partners Inc [Member] | |||||||
Goodwill and Intangible Assets [Line Items] | |||||||
Goodwill | $ 6,400 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets, net - Reconciliation of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Beginning balance | $ 32,510 | ||
Ending balance | 32,510 | $ 32,510 | |
IT Staffing Services [Member] | |||
Beginning balance | 8,427 | 8,427 | $ 8,427 |
Goodwill recorded | 0 | 0 | 0 |
Impairment | 0 | 0 | 0 |
Ending balance | 8,427 | 8,427 | 8,427 |
Data and Analytics Services [Member] | |||
Beginning balance | 24,083 | 17,679 | 17,679 |
Goodwill recorded | 0 | 6,404 | 0 |
Impairment | 0 | 0 | 0 |
Ending balance | $ 24,083 | $ 24,083 | $ 17,679 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Components of Identifiable Intangible assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Intangible Assets, Accumulated Amortization | $ 14,339 | $ 11,169 |
Total Intangible Assets, Gross Carrying Value | 33,099 | 33,099 |
Total Intangible Assets, Net Carrying Value | $ 18,760 | $ 21,930 |
Client Relationships [Member] | IT Staffing Services [Member] | ||
Amortization Period (In Years) | 12 years | 12 years |
Intangible Assets, Gross Carrying Value | $ 7,999 | $ 7,999 |
Intangible Assets, Accumulated Amortization | 4,361 | 3,694 |
Intangible Assets, Net Carrying Value | $ 3,638 | $ 4,305 |
Client Relationships [Member] | Data and Analytics Services [Member] | ||
Amortization Period (In Years) | 12 years | 12 years |
Intangible Assets, Gross Carrying Value | $ 19,641 | $ 19,641 |
Intangible Assets, Accumulated Amortization | 6,503 | 4,866 |
Intangible Assets, Net Carrying Value | $ 13,138 | $ 14,775 |
Covenant Not-to-Compete [Member] | IT Staffing Services [Member] | ||
Amortization Period (In Years) | 5 years | 5 years |
Intangible Assets, Gross Carrying Value | $ 319 | $ 319 |
Intangible Assets, Accumulated Amortization | 319 | 319 |
Intangible Assets, Net Carrying Value | $ 0 | $ 0 |
Covenant Not-to-Compete [Member] | Data and Analytics Services [Member] | ||
Amortization Period (In Years) | 5 years | 5 years |
Intangible Assets, Gross Carrying Value | $ 1,201 | $ 1,201 |
Intangible Assets, Accumulated Amortization | 788 | 548 |
Intangible Assets, Net Carrying Value | $ 413 | $ 653 |
Trade Name [Member] | IT Staffing Services [Member] | ||
Amortization Period (In Years) | 3 years | 3 years |
Intangible Assets, Gross Carrying Value | $ 249 | $ 249 |
Intangible Assets, Accumulated Amortization | 249 | 249 |
Intangible Assets, Net Carrying Value | $ 0 | $ 0 |
Trade Name [Member] | Data and Analytics Services [Member] | ||
Amortization Period (In Years) | 5 years | 5 years |
Intangible Assets, Gross Carrying Value | $ 1,711 | $ 1,711 |
Intangible Assets, Accumulated Amortization | 1,211 | 869 |
Intangible Assets, Net Carrying Value | $ 500 | $ 842 |
Technology [Member] | Data and Analytics Services [Member] | ||
Amortization Period (In Years) | 7 years | 7 years |
Intangible Assets, Gross Carrying Value | $ 1,979 | $ 1,979 |
Intangible Assets, Accumulated Amortization | 908 | 624 |
Intangible Assets, Net Carrying Value | $ 1,071 | $ 1,355 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets, net - Schedule of Estimated Amortization Expense (Detail) $ in Thousands | Dec. 31, 2021USD ($) |
Intangible Liability Disclosure [Abstract] | |
Estimated aggregate amortization expense for year ending 2022 | $ 2,987 |
Estimated aggregate amortization expense for year ending 2023 | 2,772 |
Estimated aggregate amortization expense for year ending 2024 | 2,693 |
Estimated aggregate amortization expense for year ending 2025 | 2,553 |
Estimated aggregate amortization expense for year ending 2026 | $ 2,413 |
Cash and Cash Equivalents - Add
Cash and Cash Equivalents - Additional Information (Detail) | Dec. 31, 2021USD ($) |
Cash and Cash Equivalents [Abstract] | |
Restrictions on the Company's cash balances | $ 0 |
Credit Facility - Additional in
Credit Facility - Additional information (Detail) - USD ($) $ in Thousands | Oct. 01, 2020 | Mar. 31, 2023 | Dec. 31, 2021 | Dec. 31, 2020 | Jan. 04, 2022 |
Line of Credit Facility [Line Items] | |||||
Current borrowing capacity under line of credit facility | $ 32,400 | $ 22,000 | |||
Payment of deferred financing costs | 223 | 246 | |||
Deferred financing costs | 366,000 | 225,000 | |||
Senior leverage ratio | 1.50% | ||||
Term Loan Facility [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | $ 17,500 | $ 20,000 | |||
Outstanding borrowings amount | $ 13,100 | $ 17,500 | |||
Revolving Line of Credit [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | 30,000 | ||||
Percentage of eligible accounts receivable | 85.00% | ||||
Revolving Line of Credit [Member] | United States [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Percentage of eligible unbilled accounts | 60.00% | ||||
Revolving Line of Credit [Member] | Canada [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | $ 10,000 | ||||
Percentage of eligible accounts receivable | 85.00% | ||||
Percentage of eligible unbilled accounts | 60.00% | ||||
Revolving Line of Credit [Member] | Line of Credit [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | $ 5,000 | ||||
Revolving Line of Credit [Member] | Swing Loans [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | $ 6,000 | ||||
Federal Funds Rate [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 0.50% | ||||
PNC Bank, N.A. [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | $ 53,100 | ||||
Payment of deferred financing costs | 975,000 | ||||
PNC Bank, N.A. [Member] | Term Loan Facility [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | 13,100 | ||||
Credit facility, periodic payment | $ 1,100 | ||||
PNC Bank, N.A. [Member] | Revolving Line of Credit [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Credit facility maximum borrowing capacity | $ 40,000 | ||||
Maximum [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Revolving credit facility percentage margin over base rate | 1.25% | ||||
Term loan percentage margin over base rate | 2.50% | ||||
Revolving credit facility percentage margin adjusted LIBOR rate | 2.25% | ||||
Term loan percentage margin adjusted LIBOR rate | 3.50% | ||||
Minimum [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Revolving credit facility percentage margin over base rate | 0.50% | ||||
Term loan percentage margin over base rate | 1.75% | ||||
Revolving credit facility percentage margin adjusted LIBOR rate | 1.50% | ||||
Term loan percentage margin adjusted LIBOR rate | 2.75% |
Credit Facility - Schedule of A
Credit Facility - Schedule of Annual Aggregate Outstanding Debt (Detail) $ in Thousands | Dec. 31, 2021USD ($) |
Maturities of Long-term Debt and Capital Lease Obligations [Abstract] | |
2022 | $ 4,400 |
2023 | 4,400 |
2024 | 4,300 |
2025 | 0 |
2026 | 0 |
Total | $ 13,100 |
Leases - Additional Information
Leases - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)ft² | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Square feet of office space | ft² | 97,000 | ||
Average initial lease term | 4 years | ||
Discount rate | 4.20% | ||
Operating leases, rent expense, net | $ 1.8 | $ 1.6 | $ 1.6 |
Total lease payments | 1.5 | 1.7 | 1.6 |
Lease obligation incurred | $ 3.1 | $ 0.2 | $ 0.5 |
Minimum [Member] | |||
Lease term range | 1 year | ||
Maximum [Member] | |||
Lease term range | 5 years 2 months 12 days | ||
Weighted Average [Member] | |||
Lease term range | 3 years 10 months 24 days |
Leases - Summary of Balance She
Leases - Summary of Balance Sheet classification of lease asset and related lease liability (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Assets: | ||
Long-term operating lease right-of-use assets | $ 4,894 | $ 3,286 |
Liabilities: | ||
Short-term operating lease liability | 1,479 | 1,079 |
Long-term operating lease liability | 3,706 | 2,325 |
Total Liabilities | $ 5,185 | $ 3,404 |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Rental Payments for Operating Leases (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
2022 | $ 1,687 | |
2023 | 1,639 | |
2024 | 899 | |
2025 | 629 | |
2026 | 612 | |
Thereafter | 144 | |
Total | 5,610 | |
Less: Imputed interest | (425) | |
Present value of operating lease liabilities | $ 5,185 | $ 3,404 |
Long-Term Payroll Tax Liabili_2
Long-Term Payroll Tax Liability - Additional Information (Detail) - Coronavirus Aid, Relief and Economic Security Act [Member] - Social Security Tax [Member] - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax Payment | $ 2,300 | $ 4,600 |
Accrued Payroll and Related Cost [Member] | ||
Repayment of Deferred Tax Liabilities | 2,300 | |
Long term Payroll Tax Liabilities [Member] | ||
Reclass of Deffered Tax Liabilities | 0 | $ 2,300 |
Deferred Current Liability | $ 2,300 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Matching contributions | $ 0 | $ 0 | $ 0 |
Hudson Employee Retirement Savings Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Percentage of company's matching contribution | 50.00% | ||
Percentage of employees eligible earnings for company's matching contribution | 6.00% | ||
Total contributions to the retirement plan | $ 0 | $ 0 | $ 55,000 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | May 15, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares allocated for issuance to directors, officers and key personnel | 4,900,000 | |||
Expiration period | 10 years | |||
Aggregate intrinsic value of stock options | $ 13,200,000 | |||
Intrinsic value of vested and expected to vest stock options | 7,700,000 | |||
Intrinsic value of options exercised | 355,000 | $ 4,300,000 | $ 44,000 | |
Measurement date fair value of stock options vested | $ 2,100,000 | $ 655,000 | $ 529,000 | |
Number of Options, Granted | 501,000 | 800,000 | 683,000 | |
Dividend yield assumption | 0.00% | 0.00% | 0.00% | |
Expected term (in years) | 3 years 9 months 18 days | 3 years 10 months 24 days | 5 years | |
Stock-based compensation expense | $ 2,212,000 | $ 2,021,000 | $ 936,000 | |
Tax benefits | 622,000 | $ 590,000 | $ 252,000 | |
Expenses related to non-vested stock options | $ 5,600,000 | |||
Weighted-average remaining requisite service period | 4 months 24 days | |||
Price per share | $ 17.07 | |||
Fair value estimation | The fair value of the six-month “look-back” option in the Company’s employee stock purchase plans is estimated by adding the fair value of 15% of one share of stock to the fair value of 85% of an option on one share of stock. | |||
Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Number of Options, Granted | 10,000 | 50,000 | ||
Expected term (in years) | 1 year | 1 year | ||
Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 5 years | |||
Number of Options, Granted | 491,000 | 750,000 | ||
Expected term (in years) | 4 years | 4 years | ||
Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares available for future grants | 515,549 | 600,000 | ||
Price per share | $ 12.84 | $ 10.91 | ||
Number of shares issued related to employee stock purchases | 23,492 | 20,459 | ||
Percentage of maximum contribution of salary towards plan | 15.00% | |||
Maximum contribution towards plan | $ 25,000 | |||
Discount on purchase of common stock | 15.00% | |||
Stock Incentive Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of outstanding and/or exercised stock options | 3,836,000 | |||
Shares available for future grants | 538,000 | |||
Performance Shares [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock units released or outstanding vested | 260,000 | |||
Restricted Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock units released or outstanding | 266,000 | |||
Restricted Stock Units Activity [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Aggregate intrinsic value of restricted stock units outstanding | $ 428,000 | |||
Intrinsic value of restricted shares released | 289,000 | |||
Unrecognized compensation expense | $ 65,000 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Company's Stock Option Activity (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Number of Options Outstanding, Beginning Balance | 2,009,000 | 1,721,000 | 1,111,000 |
Number of Options, Granted | 501,000 | 800,000 | 683,000 |
Number of Options, Exercised | (31,000) | (305,000) | (6,000) |
Number of Options, Cancelled / forfeited | (438,000) | (207,000) | (67,000) |
Number of Options Outstanding, Ending Balance | 2,041,000 | 2,009,000 | 1,721,000 |
Weighted Average Exercise Price, Beginning Balance | $ 9.40 | $ 5.52 | $ 4.95 |
Weighted Average Exercise Price, Granted | 17.58 | 15.49 | 6.48 |
Weighted Average Exercise Price, Exercised | 7.34 | 4.36 | 1.18 |
Weighted Average Exercise Price, Cancelled / forfeited | 13.04 | 8.04 | 6.35 |
Weighted Average Exercise Price, Ending Balance | $ 10.66 | $ 9.40 | $ 5.52 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Information Regarding the Company's Outstanding and Exercisable Stock Options (Detail) - $ / shares | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options Outstanding | 2,041,000 | 2,009,000 | 1,721,000 | 1,111,000 |
Weighted Average Remaining Contractual Life (in years) | 7 years 3 months 18 days | |||
Weighted Average Exercise Price | $ 10.66 | $ 9.40 | $ 5.52 | $ 4.95 |
Options Exercisable | 746,000 | |||
Weighted average remaining contractual life, options exercisable | 5 years 9 months 18 days | |||
Weighted average exercise price, options exercisable | $ 6.69 | |||
Range One [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options Outstanding | 355,000 | |||
Lower range of exercise price | $ 0.01 | |||
Upper range of exercise price | $ 4 | |||
Weighted Average Remaining Contractual Life (in years) | 4 years 2 months 12 days | |||
Weighted Average Exercise Price | $ 3.56 | |||
Options Exercisable | 355,000 | |||
Range of exercise prices, minimum, options exercisable | $ 0.01 | |||
Range of exercise price, maximum, options exercisable | $ 4 | |||
Weighted average remaining contractual life, options exercisable | 4 years 2 months 12 days | |||
Weighted average exercise price, options exercisable | $ 3.56 | |||
Range Two [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options Outstanding | 717,000 | |||
Lower range of exercise price | $ 4.01 | |||
Upper range of exercise price | $ 8 | |||
Weighted Average Remaining Contractual Life (in years) | 7 years | |||
Weighted Average Exercise Price | $ 6.68 | |||
Options Exercisable | 268,000 | |||
Range of exercise prices, minimum, options exercisable | $ 4.01 | |||
Range of exercise price, maximum, options exercisable | $ 8 | |||
Weighted average remaining contractual life, options exercisable | 6 years 9 months 18 days | |||
Weighted average exercise price, options exercisable | $ 6.80 | |||
Range Three [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options Outstanding | 0 | |||
Lower range of exercise price | $ 8.01 | |||
Upper range of exercise price | $ 12 | |||
Options Exercisable | 0 | |||
Range of exercise prices, minimum, options exercisable | $ 8.01 | |||
Range of exercise price, maximum, options exercisable | 12 | |||
Weighted average exercise price, options exercisable | $ 0 | |||
Range Four [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options Outstanding | 628,000 | |||
Lower range of exercise price | $ 12.01 | |||
Upper range of exercise price | $ 16 | |||
Weighted Average Remaining Contractual Life (in years) | 8 years 2 months 12 days | |||
Weighted Average Exercise Price | $ 15.49 | |||
Options Exercisable | 123,000 | |||
Range of exercise prices, minimum, options exercisable | $ 12.01 | |||
Range of exercise price, maximum, options exercisable | $ 16 | |||
Weighted average remaining contractual life, options exercisable | 8 years 2 months 12 days | |||
Weighted average exercise price, options exercisable | $ 15.49 | |||
Range Five [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options Outstanding | 341,000 | |||
Lower range of exercise price | $ 16.01 | |||
Upper range of exercise price | $ 20 | |||
Weighted Average Remaining Contractual Life (in years) | 9 years 7 months 6 days | |||
Weighted Average Exercise Price | $ 17.55 | |||
Range of exercise prices, minimum, options exercisable | 16.01 | |||
Range of exercise price, maximum, options exercisable | 20 | |||
Weighted average exercise price, options exercisable | $ 0 |
Stock-Based Compensation - Su_3
Stock-Based Compensation - Summary of Assumptions with Respect to the Black-Scholes Option Pricing Model (Detail) - $ / shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |||
Weighted-average risk-free interest rate | 0.60% | 1.40% | 2.40% |
Weighted-average dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility | 68.30% | 52.70% | 49.70% |
Expected term (in years) | 3 years 9 months 18 days | 3 years 10 months 24 days | 5 years |
Weighted-average fair value | $ 8.85 | $ 6.36 | $ 2.95 |
Stock-Based Compensation - Su_4
Stock-Based Compensation - Summary of Mastech's Restricted Stock Unit Activity (Detail) - Restricted Stock Units Activity [Member] - shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning outstanding balance | 30,843 | 33,285 | 34,380 |
Awarded | 11,955 | 11,475 | 16,365 |
Released | (17,739) | (13,917) | (17,460) |
Forfeited | 0 | ||
Ending outstanding balance | 25,059 | 30,843 | 33,285 |
Income Taxes - Components of In
Income Taxes - Components of Income Before Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income before income taxes: | |||
Domestic | $ 17,117 | $ 11,476 | $ 6,787 |
Foreign | (231) | 1,157 | 8,432 |
Income before income taxes | $ 16,886 | $ 12,633 | $ 15,219 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current provision: | |||
Federal | $ 2,657 | $ 3,044 | $ 1,555 |
State | 713 | 752 | 406 |
Foreign | 234 | 797 | 751 |
Total current provision | 3,604 | 4,593 | 2,712 |
Deferred provision (benefit): | |||
Federal | 873 | (1,340) | (13) |
State | 233 | (327) | (4) |
Foreign | (177) | (326) | 1,372 |
Total deferred provision (benefit) | 929 | (1,993) | 1,355 |
Change in valuation allowance | 132 | 172 | 7 |
Total provision for income taxes | $ 4,665 | $ 2,772 | $ 4,074 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Income taxes computed at the federal statutory rate, Value | $ 3,546 | $ 2,653 | $ 3,196 |
State income taxes, net of federal tax benefit, Value | 962 | 602 | 404 |
Excess tax benefits from stock options/restricted shares | (82) | (920) | (9) |
Charge for global intangible low-taxed income ("GILTI") | (20) | 69 | |
Difference in tax rate on foreign earnings/other | 107 | 285 | 407 |
Change in valuation allowance | 132 | 172 | 7 |
Total provision for income taxes | $ 4,665 | $ 2,772 | $ 4,074 |
Income taxes computed at the federal statutory rate | 21.00% | 21.00% | 21.00% |
State income taxes, net of federal tax benefit | 5.70% | 4.70% | 2.70% |
Excess tax benefit from stock options/restricted shares | (0.50%) | (7.30%) | (0.10%) |
Charge for global intangible low-taxed income ("GILTI") [Rate] | (0.20%) | 0.50% | |
Difference in tax rate on foreign earnings/other | 0.60% | 2.30% | 2.70% |
Change in valuation allowance[Percent] | 0.80% | 1.40% | |
Effective for income tax rate, Total | 27.60% | 21.90% | 26.80% |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 112 | $ 101 |
Accrued vacation and bonuses | 419 | 457 |
Stock-based compensation expense | 1,274 | 738 |
COVID-19 payroll tax deferment | 628 | 1,207 |
Acquisition-related transaction costs | 540 | 515 |
Net operating losses | 311 | 179 |
Total deferred tax assets | 3,284 | 3,197 |
Deferred tax liabilities: | ||
Prepaid expenses | 233 | 217 |
Depreciation, intangibles and contingent consideration | 3,005 | 2,005 |
Total deferred tax liabilities | 3,238 | 2,222 |
Valuation allowance | (311) | (179) |
Net deferred tax asset | $ 796 | |
Net deferred tax liability | $ (265) |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits Related to Uncertain Tax Positions (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Unrecognized tax benefits, beginning balance | $ 0 | $ 20 | $ 263 |
Additions related to current period | 0 | 0 | 0 |
Additions related to prior periods | 0 | 0 | 0 |
Reductions related to prior periods | 0 | (20) | (243) |
Unrecognized tax benefits, ending balance | $ 0 | $ 0 | $ 20 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred Tax Liabilities Valuation Allowance | $ 311 | $ 179 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Jul. 13, 2017 | |
Interest Rate Swap Contracts [Member] | |||
Derivative [Line Items] | |||
Liability of fair value of the interest rate swap contracts | $ 35,000 | ||
Interest Rate Swap Contracts [Member] | Other Current Liabilities [Member] | |||
Derivative [Line Items] | |||
Liability of fair value of the interest rate swap contracts | 0 | 35,000 | |
Interest Rate Risk Management [Member] | |||
Derivative [Line Items] | |||
Notional amount | 0 | 8,100,000 | |
Interest Rate Risk Management [Member] | Interest Rate Swap Contracts [Member] | |||
Derivative [Line Items] | |||
Notional amount | $ 15,000,000 | ||
Fixed rate of interest in swap contracts | 1.99% | ||
Interest Rate Risk Management [Member] | Interest Rate Swap Contracts [Member] | Other Current Liabilities [Member] | |||
Derivative [Line Items] | |||
Liability of fair value of the interest rate swap contracts | 0 | $ 35,000 | |
Designated as Hedging Instrument [Member] | Currency Hedge and Interest Rate Swap [Member] | |||
Derivative [Line Items] | |||
Estimated amount of pretax losses from other comprehensive income (loss) during the next 12-months | $ 0 |
Derivative Instruments and He_4
Derivative Instruments and Hedging Activities - Effect of Derivative Instruments on Consolidated Statements of Operations and Comprehensive Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain / (Loss) recognized in OCI on Derivatives | $ 35 | $ 8 | $ (149) |
Interest rate swap contracts [Member] | Cash Flow Hedging Relationships [Member] | Interest Expense [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain / (Loss) recognized in OCI on Derivatives | 35 | 8 | |
Amount of Gain / (Loss) reclassified from Accumulated OCI to Income | 34 | 121 | |
Amount of Gain / (Loss) recognized in Income on Derivatives | $ 0 | $ 0 |
Derivative Instruments and He_5
Derivative Instruments and Hedging Activities - Information on Location and Amounts of Derivative Fair Values in Consolidated Balance Sheets (Detail) - Interest Rate Swap Contracts [Member] - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | ||
Derivative Fair Value Liability | $ 35 | |
Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Fair Value Liability | $ 0 | $ 35 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Equity, Class of Treasury Stock [Line Items] | ||
Shares purchased to satisfy employee tax obligation | 0 | 0 |
Earnings per Share - Additional
Earnings per Share - Additional Information (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |||
Anti-dilutive securities not included in computation of earnings per share | 276,000 | 0 | 518,000 |
Earnings per Share - Schedule o
Earnings per Share - Schedule of Denominators of Basic and Diluted EPS Computations (Detail) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Weighted-average shares outstanding: | |||
Basic | 11,436 | 11,292 | 11,029 |
Stock options and restricted share units | 571 | 658 | 203 |
Diluted | 12,007 | 11,950 | 11,232 |
Earnings per Share - Computatio
Earnings per Share - Computation of Basic EPS (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |||
Net income | $ 12,221 | $ 9,861 | $ 11,145 |
Basic weighted-average shares outstanding | 11,436 | 11,292 | 11,029 |
Basic EPS | $ 1.07 | $ 0.87 | $ 1.01 |
Earnings per Share - Computat_2
Earnings per Share - Computation of Diluted EPS (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |||
Net income | $ 12,221 | $ 9,861 | $ 11,145 |
Diluted weighted-average shares outstanding | 12,007 | 11,950 | 11,232 |
Diluted EPS | $ 1.02 | $ 0.83 | $ 0.99 |
Other Comprehensive Income (L_3
Other Comprehensive Income (Loss) - Summary Of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning balance of Foreign Currency | $ (513) | $ (326) | $ (197) |
Gain (loss) arising during the period | (94) | (187) | (129) |
Reclassification to earnings for gain (loss) realized | 0 | 0 | 0 |
Income tax (expense) | 0 | 0 | 0 |
Net other comprehensive income (loss) – year | (94) | (187) | (129) |
Ending balance Foreign Currency | (607) | (513) | (326) |
Beginning balance of Derivative Financial Instrument | (26) | (32) | 78 |
Gain (loss) arising during the period | 1 | (113) | (181) |
Reclassification to earnings for gain (loss) realized | 34 | 121 | 32 |
Income tax (expense) | (9) | (2) | 39 |
Net other comprehensive income (loss) – year | 26 | 6 | (110) |
Ending balance of Derivative Financial Instrument | 0 | (26) | (32) |
Beginning balance of Total | (539) | (358) | (119) |
Gain (loss) arising during the period | (93) | (300) | (310) |
Reclassification to earnings for gain (loss) realized | 34 | 121 | 32 |
Income tax benefit | (9) | (2) | 39 |
Net other comprehensive income (loss) – year | (68) | (181) | (239) |
Ending balance of Total | $ (607) | $ (539) | $ (358) |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Line Items] | |||
Revaluation of contingent consideration liability | $ (2,882) | $ (6,069) | |
Fair value of contingent consideration | 0 | $ 2,882 | |
Info Trellis Inc [Member] | |||
Fair Value Disclosures [Line Items] | |||
Revaluation of contingent consideration liability | 2,900 | 0 | $ 6,100 |
AmberLeaf [Member] | |||
Fair Value Disclosures [Line Items] | |||
Revaluation of contingent consideration liability | 2,900 | ||
Fair value of contingent consideration | $ 0 | $ 2,900 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Financial Assets (Liabilities) at Fair Value Measured on Recurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration liabilities | $ 0 | $ (2,882) |
Interest Rate Swap Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of financial liability | (35) | |
Contingent consideration liabilities | (2,882) | |
Level 2 [Member] | Interest Rate Swap Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of financial liability | (35) | |
Level 3 [Member] | Interest Rate Swap Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration liabilities | $ (2,882) |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Changes in Contingent Consideration Liability (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |||
Beginning balance | $ 2,882 | $ 0 | $ 6,069 |
Contingent consideration liabilities | 0 | 2,882 | |
Payments made | 0 | 0 | 0 |
Revaluation | (2,882) | (6,069) | |
Ending balance | $ 0 | $ 2,882 | $ 0 |
Business Segments and Geograp_3
Business Segments and Geographic Information - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2021Segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | 2 |
Data and Analytics Services [Member] | Business Combination Credit Agreement [Member] | |
Segment Reporting Information [Line Items] | |
Business acquisition date | Jul. 13, 2017 |
Business Segments and Geograp_4
Business Segments and Geographic Information - Summary of Operating Segments (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 222,012 | $ 194,101 | $ 193,574 |
Total gross margin % | 26.80% | 26.60% | 24.80% |
Segment operating income | $ 17,610 | $ 13,403 | $ 16,987 |
Amortization of acquired intangible assets | (3,170) | (2,790) | (2,688) |
Revaluation of contingent consideration liability | 2,882 | 6,069 | |
Acquisition-related transaction expenses | (140) | (650) | 110 |
Interest expenses and other, net | (724) | (770) | (1,768) |
Income before income taxes | 16,886 | 12,633 | 15,219 |
Data and analytics services [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | $ 38,339 | $ 30,226 | $ 26,663 |
Total gross margin % | 48.40% | 50.50% | 46.70% |
IT staffing services [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | $ 183,673 | $ 163,875 | $ 166,911 |
Total gross margin % | 22.30% | 22.10% | 21.30% |
Operating Segments [Member] | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | $ 18,038 | $ 16,843 | $ 13,496 |
Operating Segments [Member] | Data and analytics services [Member] | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | 5,310 | 5,455 | 5,495 |
Operating Segments [Member] | IT staffing services [Member] | |||
Segment Reporting Information [Line Items] | |||
Segment operating income | $ 12,728 | $ 11,388 | $ 8,001 |
Business Segments and Geograp_5
Business Segments and Geographic Information - Summary of Assets by Segment (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | $ 113,702 | $ 102,046 | $ 90,584 |
Capital Expenditures | 1,895 | 298 | 1,014 |
Depreciation & Amortization | 3,979 | 3,589 | 3,434 |
Data and analytics services [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 56,634 | 55,792 | 41,527 |
Capital Expenditures | 1,692 | 193 | 203 |
Depreciation & Amortization | 2,662 | 2,245 | 2,078 |
IT Staffing Services [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 57,068 | 46,254 | 49,057 |
Capital Expenditures | 203 | 105 | 811 |
Depreciation & Amortization | $ 1,317 | $ 1,344 | $ 1,356 |
Business Segments and Geograp_6
Business Segments and Geographic Information - Summary of Revenue from External Customers (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 222,012 | $ 194,101 | $ 193,574 |
Equipment, Enterprise Software and Leasehold Improvements, net | 3,038 | 1,971 | 2,476 |
United States [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 212,356 | 189,890 | 188,710 |
Equipment, Enterprise Software and Leasehold Improvements, net | 2,221 | 1,613 | 2,095 |
Canada [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 6,566 | 3,603 | 2,918 |
Equipment, Enterprise Software and Leasehold Improvements, net | 2 | 7 | 8 |
India and Other [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 3,090 | 608 | 1,946 |
Equipment, Enterprise Software and Leasehold Improvements, net | $ 815 | $ 351 | $ 373 |
Related-Party Transaction - Add
Related-Party Transaction - Additional Information (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2021USD ($) | |
CrowdStrike Inc [Member] | |
Related Party Transaction [Line Items] | |
Related party purchases | $ 98,000 |