Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 25, 2016 | May. 09, 2016 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Delta Tucker Holdings, Inc. | |
Entity Central Index Key | 1,514,226 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 25, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 100 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Income Statement [Abstract] | ||
Revenue | $ 419,990 | $ 467,022 |
Cost of services | (372,498) | (424,158) |
Selling, general and administrative expenses | (34,090) | (31,223) |
Depreciation and amortization expense | (8,291) | (7,259) |
Earnings from equity method investees | 367 | 68 |
Operating income | 5,478 | 4,450 |
Interest expense | (15,968) | (16,055) |
Interest income | 60 | 17 |
Other income, net | 352 | 994 |
Loss before income taxes | (10,078) | (10,594) |
Provision for income taxes | (4,494) | (3,809) |
Net loss | (14,572) | (14,403) |
Noncontrolling interests | (187) | (431) |
Net loss attributable to Delta Tucker Holdings, Inc. | $ (14,759) | $ (14,834) |
Unaudited Condensed Consolidat3
Unaudited Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (14,572) | $ (14,403) |
Other comprehensive loss, net of tax: | ||
Foreign currency translation adjustment | 3 | (113) |
Other comprehensive income (loss), before tax | 3 | (113) |
Income tax (expense) benefit related to items of other comprehensive loss | (1) | 40 |
Other comprehensive income (loss) | 2 | (73) |
Comprehensive loss | (14,570) | (14,476) |
Comprehensive loss attributable to noncontrolling interests | (187) | (431) |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | $ (14,757) | $ (14,907) |
Unaudited Condensed Consolidat4
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 74,787 | $ 108,782 |
Restricted cash | 721 | 721 |
Accounts receivable, net of allowances of $16,364 and $16,283 respectively | 381,632 | 386,097 |
Prepaid expenses and other current assets | 50,973 | 55,683 |
Assets held for sale | 6,155 | 7,913 |
Total current assets | 514,268 | 559,196 |
Property and equipment, net | 15,688 | 15,694 |
Goodwill | 42,093 | 42,093 |
Tradenames, net | 28,536 | 28,536 |
Other intangibles, net | 107,211 | 113,479 |
Long-term deferred taxes | 0 | 13,364 |
Other assets, net | 15,756 | 12,327 |
Total assets | 723,552 | 784,689 |
Current liabilities: | ||
Current portion of long-term debt | 185,948 | 184,866 |
Accounts payable | 87,475 | 90,610 |
Accrued payroll and employee costs | 97,572 | 100,681 |
Deferred income taxes | 0 | 27,334 |
Accrued liabilities | 83,765 | 114,718 |
Liabilities held for sale | 426 | 784 |
Income taxes payable | 10,042 | 8,130 |
Total current liabilities | 465,228 | 527,123 |
Long-term debt | 452,605 | 452,165 |
Long-term deferred taxes | 16,495 | 0 |
Other long-term liabilities | 12,351 | 13,571 |
Total liabilities | 946,679 | 992,859 |
DEFICIT | ||
Common stock, $0.01 par value – 1,000 shares authorized and 100 shares issued and outstanding at March 25, 2016 and December 31, 2015, respectively | 0 | 0 |
Additional paid-in capital | 554,598 | 554,379 |
Accumulated deficit | (782,740) | (767,981) |
Accumulated other comprehensive loss | (358) | (360) |
Total deficit attributable to Delta Tucker Holdings, Inc. | (228,500) | (213,962) |
Noncontrolling interests | 5,373 | 5,792 |
Total deficit | (223,127) | (208,170) |
Total liabilities and deficit | $ 723,552 | $ 784,689 |
Unaudited Condensed Consolidat5
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 16,364 | $ 16,283 |
Common stock, par value (in dollars per share) | $ 0.01000 | $ 0.01000 |
Common stock, shares authorized (in shares) | 1,000 | 1,000 |
Common stock, shares issued (in shares) | 100 | 100 |
Common stock, shares outstanding (in shares) | 100 | 100 |
Unaudited Condensed Consolidat6
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Cash flows from operating activities | ||
Net loss | $ (14,572) | $ (14,403) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 8,516 | 7,798 |
Amortization of deferred loan costs | 1,522 | 1,540 |
Earnings from equity method investees | (367) | (517) |
Deferred income taxes | 2,525 | 2,140 |
Share based compensation | 17 | 193 |
Other | 125 | (1,049) |
Changes in assets and liabilities: | ||
Accounts receivable | 4,341 | (18,952) |
Prepaid expenses and other current assets | 4,608 | 3,737 |
Accounts payable and accrued liabilities | (39,313) | (13,032) |
Income taxes payable | 2,055 | (1,018) |
Net cash used in operating activities | (30,543) | (33,563) |
Cash flows from investing activities | ||
Purchase of property and equipment | (812) | (173) |
Purchase of software | (1,261) | (417) |
Return of capital from equity method investees | 0 | 1,822 |
Contributions to equity method investees | (1,225) | (500) |
Net cash (used in) provided by investing activities | (3,298) | 732 |
Cash flows from financing activities | ||
Borrowings on indebtedness | 0 | 34,900 |
Payments on indebtedness | 0 | (34,900) |
Payments under other financing arrangements | 0 | (1,023) |
Equity contribution from affiliates of Cerberus | 250 | 0 |
Payment of dividends to noncontrolling interests | (404) | (303) |
Net cash used in financing activities | (154) | (1,326) |
Net decrease in cash and cash equivalents | (33,995) | (34,157) |
Cash and cash equivalents, beginning of period | 108,782 | 94,004 |
Cash and cash equivalents, end of period | 74,787 | 59,847 |
Income tax (refund received) paid, net | (3) | 3,022 |
Interest paid | $ 26,916 | $ 24,202 |
Unaudited Condensed Consolidat7
Unaudited Condensed Consolidated Statements of Deficit - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ (208,170) | $ (77,277) |
Balance, Shares | 100 | |
Share based compensation, net | $ 9 | 171 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,570) | (14,476) |
Capital contribution | 250 | |
DIFZ financing, net of tax | (40) | (77) |
Dividends declared to noncontrolling interests | (606) | (303) |
Balance | $ (223,127) | (91,962) |
Balance, Shares | 100 | |
Common Stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ 0 | $ 0 |
Balance, Shares | 0 | 0 |
Balance | $ 0 | $ 0 |
Balance, Shares | 0 | 0 |
Additional Paid-in Capital | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | $ 554,379 | $ 552,894 |
Share based compensation, net | 9 | 171 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | 0 | 0 |
Capital contribution | 250 | |
DIFZ financing, net of tax | (40) | (77) |
Dividends declared to noncontrolling interests | 0 | 0 |
Balance | 554,598 | 552,988 |
Accumulated Deficit | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | (767,981) | (635,379) |
Share based compensation, net | 0 | 0 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,759) | (14,834) |
Capital contribution | 0 | |
DIFZ financing, net of tax | 0 | 0 |
Dividends declared to noncontrolling interests | 0 | 0 |
Balance | (782,740) | (650,213) |
Accumulated Other Comprehensive Loss | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | (360) | (281) |
Share based compensation, net | 0 | 0 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | 2 | (73) |
Capital contribution | 0 | |
DIFZ financing, net of tax | 0 | 0 |
Dividends declared to noncontrolling interests | 0 | 0 |
Balance | (358) | (354) |
Total Deficit Attributable to Delta Tucker Holdings, Inc. | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | (213,962) | (82,766) |
Share based compensation, net | 9 | 171 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,757) | (14,907) |
Capital contribution | 250 | |
DIFZ financing, net of tax | (40) | (77) |
Dividends declared to noncontrolling interests | 0 | 0 |
Balance | (228,500) | (97,579) |
Noncontrolling Interest | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Balance | 5,792 | 5,489 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | 187 | 431 |
Capital contribution | 0 | |
DIFZ financing, net of tax | 0 | 0 |
Dividends declared to noncontrolling interests | (606) | (303) |
Balance | $ 5,373 | $ 5,617 |
Basis of Presentation and Accou
Basis of Presentation and Accounting Policies | 3 Months Ended |
Mar. 25, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Accounting Policies | Basis of Presentation and Accounting Policies Basis of Presentation Delta Tucker Holdings, Inc. ("Holdings"), the parent of DynCorp International Inc., through its subsidiaries (together, "the Company"), provides defense and technical services and government outsourced solutions primarily to U.S. government agencies domestically and internationally. The Company was incorporated in the state of Delaware on April 1, 2010. Our customers include the U.S. Department of Defense ("DoD"), the U.S. Department of State ("DoS"), the U.S. Agency for International Development ("USAID"), foreign governments, commercial customers and certain other U.S. federal, state and local government departments and agencies. Unless the context otherwise indicates, references herein to "we," "our," "us," or "the Company" refer to Delta Tucker Holdings, Inc. and our consolidated subsidiaries. The unaudited condensed consolidated financial statements include the accounts of the Company and our domestic and foreign subsidiaries. These unaudited condensed consolidated financial statements have been prepared pursuant to accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that all disclosures are adequate and do not make the information presented misleading. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 . In the opinion of management, normal recurring adjustments necessary to fairly present our financial position as of March 25, 2016 and December 31, 2015 , the results of operations and statements of comprehensive loss for the three months ended March 25, 2016 and March 27, 2015 and the statements of deficit and cash flows for the three months ended March 25, 2016 and March 27, 2015 have been included. The results of operations and statements of comprehensive loss for the three months ended March 25, 2016 and March 27, 2015 and the statements of deficit and cash flows for the three months ended March 25, 2016 and March 27, 2015 are not necessarily indicative of the results to be expected for the full calendar year or for any future periods. We use estimates and assumptions required for preparation of the financial statements. The estimates are primarily based on historical experience and business knowledge and are revised as circumstances change. Our actual results may differ from these estimates. As described below and further in Note 7, our Senior Credit Facility matures on July 7, 2016. We are addressing our upcoming maturity under the Senior Credit Facility through the refinancing actions discussed below. However, there can be no assurances that we will be able to complete these transactions. For example, if a "Material Adverse Effect", as defined in Amendment No. 5 (as defined below), were to occur prior to closing the Refinancing Transactions, such as if we did not win the recompete on the INL Air Wing contract and such failure to win the recompete were to result in a "Material Adverse Effect" under Amendment No. 5, then the Company’s lenders may not be required to fund the New Senior Credit Facility (as defined below). If the lenders did not fund the New Senior Credit Facility, we would not be able to close the refinancing transactions. If we are unable to complete these transactions or otherwise refinance the Senior Credit Facility prior to its scheduled maturity date or prior to an event which could result in an acceleration of the maturity date (such as the expiration of the New Senior Credit Facility Waiver (as defined below)), then the failure to pay all amounts due under the Senior Credit Facility at maturity or upon acceleration would be an event of default under the Senior Credit Facility. This potential outcome results in significant doubt in the Company’s ability to continue as a going concern. Such an event of default to pay principal due at scheduled maturity under or upon acceleration of the Senior Credit Facility would also cause an event of default under our Senior Unsecured Notes (as defined below). The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern and do not include any adjustments that may result from the outcome of this uncertainty. Recent Developments / Refinancing Actions As further described in Note 7, on April 30, 2016 , the Company entered into a support agreement (the “Support Agreement”) with holders of approximately 69% of our Senior Unsecured Notes (as defined herein). The Support Agreement was entered into in connection with the Company’s (1) offer to exchange (the “Exchange Offer”) any and all of its outstanding $455,000,000 principal amount of our Senior Unsecured Notes for $45,000,000 cash and up to $410,000,000 principal amount of newly issued 11.875% Senior Secured Second Lien Notes due 2020 of DynCorp International Inc. (the “New Notes”) and (2) related solicitation (the “Consent Solicitation”) of consents from holders of Senior Unsecured Notes to the proposed amendments to the indenture governing the Senior Unsecured Notes. On May 2, 2016 , DynCorp International Inc. commenced the Exchange Offer and Consent Solicitation. The Exchange Offer and related Consent Solicitation are elements of a comprehensive refinancing of our outstanding secured and unsecured indebtedness to extend existing maturities (the “Refinancing Transactions”). If the Exchange Offer is consummated, interest on the New Notes will accrue at the rate of 11.875% per annum, comprised of 10.375% per annum in cash and 1.500% per annum payable in kind (“PIK”). In the Exchange Offer and Consent Solicitation, the Early Delivery Time (for receipt of the “Total Offer Consideration” as described in the Offering Memorandum and Consent Solicitation Statement, dated as of May 2, 2016 (the “Offering Memorandum”)), is 5:00 p.m., New York City time, on the later of (1) the fifth business day following the date that Holdings files its Quarterly Report on Form 10-Q for the period ended March 25, 2016 and (2) May 13, 2016 . Since we filed this Quarterly Report on Form 10-Q on May 9, 2016 , the Early Delivery Time is 5:00 p.m., New York City time, on May 16, 2016 . The Expiration Time for receiving the Exchange Offer Consideration (as described in the Offering Memorandum) is 5:00 p.m., New York City time, on June 10, 2016 . The Early Delivery Time and Expiration Time and other terms and conditions of the Exchange Offer and Consent Solicitation are subject to extension or amendment pursuant to the terms and conditions of the Offering Memorandum, the Support Agreement and applicable law. As part of the Refinancing Transactions, on April 30, 2016 , the Company entered into Amendment No. 5 and Waiver (“Amendment No. 5”) to our Senior Credit Facility. The independent registered public accounting firm that audited our financial statements for the year ended December 31, 2015 included an explanatory paragraph in its audit report regarding our ability to continue as a going concern. Pursuant to Amendment No. 5, required lenders under the Senior Credit Facility agreed to waive the Company’s requirement to comply with the covenant that the Company’s annual financial statements include a report from its independent registered public accounting firm without a qualification as to the Company’s ability to continue as a going concern until the earlier of the effectiveness of the New Senior Credit Facility (at which time the waiver of this requirement for the fiscal year ended December 31, 2015 would become permanent) and June 30, 2016 (the “Senior Credit Facility Waiver”). During the effectiveness of the Senior Credit Facility Waiver, unless the effectiveness of the New Senior Credit Facility has occurred, the aggregate amount of outstanding revolving loans and letters of credit may not exceed 50% of the aggregate revolving credit commitments under the Senior Credit Facility. In addition, during the waiver period, any proceeds of revolving loans may only be used for working capital purposes and in the ordinary course of business for other general corporate purposes. The Company may not use the proceeds of revolving loans for dividends, prepayments of any junior debt or acquisition financing. Upon the satisfaction of certain conditions, including consummation of the Exchange Offer and the other Refinancing Transactions, the New Senior Credit Facility shall become effective, and the Senior Credit Facility Waiver will become permanent. Pursuant to the terms of the New Senior Credit Facility, among other things, the maturity of certain of the revolving credit commitments shall be extended into the Extended Revolving Credit Facility and certain lenders will provide the New Term Loan Facility, the proceeds of which will be used to repay the existing term loans under the Senior Credit Facility in full. Upon the effectiveness of Amendment No. 5, the credit facilities under the New Senior Credit Facility will consist of (collectively, the “New Senior Credit Facility”): • a $207.3 million New Term Loan Facility (the “New Term Loan Facility”); • a $24.8 million class A revolving facility, with commitments to terminate on July 7, 2016 , as more fully described in Note 7; • a $107.3 million class B revolving facility, provided that each revolving lender’s class B revolving facility commitment shall be reduced by 20% on June 24, 2016 (or if the effective date of the New Senior Credit Facility occurs after June 24, 2016 , on the effective date of the New Senior Credit Facility), unless such lender declines such reduction (the “Extended Revolving Credit Facility”); and • up to $15.0 million in incremental revolving facilities provided by and at the discretion of certain non-debt fund affiliates that are controlled by Cerberus Capital Management, L.P. ("Cerberus"), which shall rank pari passu with, and be on the same terms as, the class B revolving facility. In addition, on April 30, 2016 , DynCorp Funding LLC, a limited liability company managed by Cerberus, delivered to us a commitment letter (the “Cerberus Investment Commitment Letter”) to provide $30 million (the “Cerberus Investment”) of third-lien secured loans (the “Cerberus 3L Notes”) upon satisfaction of certain conditions, including consummation of the Exchange Offer. The consummation of each of the elements of the Refinancing Transactions is a condition to the Exchange Offer and vice versa. In addition, the Exchange Offer is conditioned upon, among other things, the valid tender and acceptance by DynCorp International Inc. of at least $409.5 million (or 90% ) (the “Minimum Condition”) aggregate principal amount of Senior Unsecured Notes in the Exchange Offer. See Note 7 for a description of certain other terms of the Senior Credit Facility Waiver, New Term Loan Facility, Extended Revolving Credit Facility and Cerberus 3L Notes. Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of both our domestic and foreign subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The Company has investments in joint ventures that are variable interest entities ("VIEs"). The VIE investments are accounted for in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 810 — Consolidation . In cases where the Company has (i) the power to direct the activities of the VIE that most significantly impact its economic performance and (ii) the obligation to absorb losses of the VIE that could potentially be significant or the right to receive benefits from the entity that could potentially be significant to the VIE, the Company consolidates the entity. Alternatively, in cases where all of the aforementioned criteria are not met, the investment is accounted for under the equity method. The Company classifies its equity method investees in two distinct groups based on management’s day-to-day involvement in the operations of each entity and the nature of each joint venture’s business. If the joint venture is deemed to be an extension of one of our segments and operationally integral to the business, our share of the joint venture’s earnings is reported within operating loss in Earnings from equity method investees in the consolidated statement of operations. If the Company considers our involvement less significant, the share of the joint venture’s net earnings is reported in Other income, net in the consolidated statement of operations. Noncontrolling Interests We record the impact of our partners' interests in less than wholly owned consolidated joint ventures as noncontrolling interests. Currently, DynCorp International FZ-LLC ("DIFZ") is our only consolidated joint venture for which we do not own 100% of the entity. We hold 25% ownership interest in DIFZ. We continue to consolidate DIFZ as we still exercise power over activities that significantly impact DIFZ’s economic performance and have the obligation to absorb losses or receive benefits of DIFZ that could potentially be significant to DIFZ. Noncontrolling interests is presented on the face of the statements of operations as an increase or reduction in arriving at "Net loss attributable to Delta Tucker Holdings, Inc." Noncontrolling interests is located in the equity section on the consolidated balance sheets. See Note 10 for further discussion regarding DIFZ. Use of Estimates The preparation of the financial statements requires us to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. Our estimates and assumptions are reviewed periodically, and the effects of changes, if any, are reflected in the consolidated statements of operations in the period that they are determined. Changes in contract estimates related to certain types of contracts accounted for using the percentage of completion method of accounting are recognized in the period in which such changes are made for the inception-to-date effect of the changes. Changes in these estimates can occur over the life of a contract for a variety of reasons, including changes in scope, estimated incentive or award fees, cost estimates, level of effort and/or other assumptions impacting revenue or cost to perform a contract. The gross favorable and unfavorable adjustments below reflect these changes in contract estimates during each reporting period, excluding new or completed contracts where no comparative estimates exist between reporting periods. The following table presents the aggregate gross favorable and unfavorable adjustments to income before taxes resulting from changes in contract estimates for the three months ended March 25, 2016 and March 27, 2015 . Three Months Ended (Amounts in millions) March 25, 2016 March 27, 2015 Gross favorable adjustments $ 6.7 $ 3.2 Gross unfavorable adjustments (2.0 ) (5.8 ) Net adjustments $ 4.7 $ (2.6 ) Accounting Policies In January 2015, the FASB issued Accounting Standards Update ("ASU") No. 2015-01, Income Statement-Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. ASU 2015-01 eliminates from GAAP the concept of extraordinary items. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015, and may be applied either prospectively or retrospectively to all prior periods presented in the financial statements. We prospectively adopted ASU No. 2015-01 during the quarter ended March 25, 2016 . The adoption of this guidance did not have a material impact on our consolidated financial statements. In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. ASU 2015-02 changes the consolidation guidance to address concerns of stakeholders that current accounting for certain legal entities might require a reporting entity to consolidate another legal entity in situations in which the reporting entity’s contractual rights do not give it the ability to act primarily on its own behalf, the reporting entity does not hold a majority of the legal entity’s voting rights, or the reporting entity is not exposed to a majority of the legal entity’s economic benefits or obligations. ASU 2015-02 will be effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. We adopted ASU No. 2015-02 during the quarter ended March 25, 2016 . The adoption of this guidance did not have a material impact on our consolidated financial position, results of operations or cash flows. In April 2015, the FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 requires that deferred financing costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability instead of being presented as an asset, consistent with debt discounts. Debt disclosures will include the face amount of the debt liability and the effective interest rate. The update is effective for fiscal years beginning after December 15, 2015, and required retrospective application. We adopted ASU 2015-03 during the quarter ended March 25, 2016 and applied its provisions retrospectively. The adoption of ASU 2015-03 resulted in the reclassification of current deferred financing costs, net, of $2.4 million related to our Term Loan and Revolver from prepaid expenses and other current assets to the current portion of long-term debt and the reclassification of deferred financing costs, net, of $2.8 million related to our Senior Unsecured Notes from total other assets, net, to long-term debt within our Condensed Consolidated Balance Sheets as of December 31, 2015 . Adoption of this standard did not impact the results of operations, retained earnings, or cash flows in the current or previous interim and annual reporting periods. In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , which eliminates the current requirement to present deferred tax liabilities and assets as current and noncurrent amounts in a classified statement of financial position. Instead, entities will be required to classify all deferred tax assets and liabilities as noncurrent in a statement of financial position. This standard is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. We adopted ASU No. 2015-17 during the quarter ended March 25, 2016 and applied it prospectively to the period ended March 25, 2016 . Prior periods were not retroactively adjusted. Adoption of this standard did not impact the results of operations, retained earnings, or cash flows in the current or previous interim and annual reporting periods. Excluding the adoption of the accounting standards updates discussed above, there have been no material changes to our significant accounting policies from those described in our Annual Report on Form 10-K for the year ended December 31, 2015 . Accounting Developments In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , which outlines a single set of comprehensive principles for recognizing revenue under GAAP. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) . ASU 2016-08 clarifies the implementation guidance on principal versus agent considerations. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing . ASU 2016-10 clarifies the implementation guidance on identifying performance obligations. These ASUs apply to all entities that enter into contracts with customers to transfer goods or services. These ASUs are effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted, but not before interim and annual reporting periods beginning after December 15, 2016. Entities have the choice to apply these ASUs either retrospectively to each reporting period presented or by recognizing the cumulative effect of applying these standards at the date of initial application and not adjusting comparative information. We are currently evaluating both methods of adoption as well as the effect of these standards will have on our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. ASU 2015-11 requires an entity who measures inventory using FIFO or average cost to measure inventory at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs. The update is effective for fiscal years beginning after December 15, 2016 and interim periods within fiscal years beginning after December 15, 2016 and applied prospectively. Early adoption is permitted, including adoption in an interim period. We are currently evaluating the potential effects of the adoption of ASU 2015-11 on our consolidated financial position. In February 2016, the FASB issued ASU No. 2016-02, Leases . The guidance in ASU 2016-02 supersedes the lease recognition requirements in ASC Topic 840, Leases . ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the potential effects of the adoption of ASU 2016-02 on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-06, Derivatives and Hedging: Contingent Put and Call Options in Debt Instruments. ASU 2016-06 clarifies how to assess whether an embedded contingent put or call option is clearly and closely related to a debt host. The amendments are effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016. The amendments are effective for annual reporting periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the potential effects of the adoption of ASU 2016-06 on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, Investments - Equity Method and Joint Ventures: Simplifying the Transition to the Equity Method of Accounting. ASU 2016-07 simplifies the equity method by eliminating the requirement to apply it retrospectively to an investment that subsequently qualifies for such accounting as a result of an increase in the level of ownership interest or degree of influence. The amendments are effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016. Early adoption is permitted. We are currently evaluating the potential effects of the adoption of ASU 2016-07 on our consolidated financial statements. Other accounting standards updates effective after March 25, 2016 are not expected to have a material effect on our consolidated financial position or results of operations and cash flows for the period ended March 25, 2016 . |
Composition of Certain Financia
Composition of Certain Financial Statement Captions | 3 Months Ended |
Mar. 25, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Composition of Certain Financial Statement Caption | Composition of Certain Financial Statement Captions The following tables present financial information of certain consolidated balance sheet captions. Prepaid expenses and other current assets As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Prepaid expenses $ 31,583 $ 30,985 Income tax refunds receivable 63 204 Inventories 13,636 14,776 Work-in-process inventory 1,733 1,733 Joint venture receivables 351 460 Other current assets 3,607 7,525 Total prepaid expenses and other current assets $ 50,973 $ 55,683 Prepaid expenses include prepaid insurance, prepaid vendor deposits, and prepaid rent, none of which individually exceed 5% of current assets. We adopted ASU 2015-03 during the quarter ended March 25, 2016 and applied its provisions retrospectively. The adoption of ASU 2015-03 resulted in the reclassification of current deferred financing costs, net, of $2.4 million related to our Term Loan and Revolver from prepaid expenses and other current assets to the current portion of long-term debt within its consolidated balance sheets as of December 31, 2015 . See Note 7 for a tabular presentation of our deferred financing costs, net, reclassified by debt balance, as of March 25, 2016 and December 31, 2015 . See Note 1 for further discussion. Other current assets decreased from $7.5 million as of December 31, 2015 to $3.6 million as of March 25, 2016 primarily due to the collection of an insurance receivable. Held for Sale Assets and Liabilities During the third quarter of 2015, we took strategic actions to begin the sale of the remaining assets of Heliworks. The assets, excluding cash and cash equivalents, of Heliworks were classified as held for sale as of September 25, 2015. As of March 25, 2016 and December 31, 2015 , Assets held for sale of $6.2 million and $7.9 million , respectively, consisted primarily of accounts receivable, inventory, property and equipment, net, and intangible assets. Liabilities held for sale of $0.4 million and $0.8 million , respectively, as of March 25, 2016 and December 31, 2015 consist primarily of accounts payables and accruals. Property and equipment, net As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Helicopters $ 983 $ 983 Computers and other equipment 10,814 10,392 Leasehold improvements 20,169 19,639 Office furniture and fixtures 4,551 4,541 Gross property and equipment 36,517 35,555 Less accumulated depreciation (20,829 ) (19,861 ) Total property and equipment, net $ 15,688 $ 15,694 As of March 25, 2016 and December 31, 2015 , Property and equipment, net also included the accrual for property additions of $0.2 million and $0.3 million , respectively. Depreciation expense, including certain depreciation amounts classified as Cost of services, was $1.0 million and $1.5 million during the three months ended March 25, 2016 and March 27, 2015 , respectively. Other assets, net As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Investment in affiliates 8,304 6,712 Palm promissory note, long-term portion 1,708 2,079 Other 5,744 3,536 Total other assets, net $ 15,756 $ 12,327 We adopted ASU 2015-03 during the quarter ended March 25, 2016 and applied its provisions retrospectively. The adoption of ASU 2015-03 resulted in the reclassification of deferred financing costs, net, of $2.8 million related to our Senior Unsecured Notes from total other assets, net, to long-term debt within its consolidated balance sheets as of December 31, 2015 . See Note 7 for a tabular presentation of our deferred financing costs, net, reclassified by debt balance, as of March 25, 2016 and December 31, 2015 . See Note 1 for further discussion. Accrued payroll and employee costs As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Wages, compensation and other benefits $ 79,400 $ 85,216 Accrued vacation 16,943 14,433 Accrued contributions to employee benefit plans 1,229 1,032 Total accrued payroll and employee costs $ 97,572 $ 100,681 Accrued liabilities As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Customer liabilities $ 15,702 $ 21,183 Accrued insurance 27,472 35,530 Accrued interest 11,864 24,370 Contract losses 9,941 15,718 Legal reserves 4,638 5,063 Subcontractor retention 1,363 1,646 Other 12,785 11,208 Total accrued liabilities $ 83,765 $ 114,718 Customer liabilities represent amounts received from customers in excess of revenue recognized or for amounts due back to a customer. The decrease in customer liabilities was primarily due to payments to customers. The decrease in accrued insurance is primarily due to the timing of payments and the closing of certain insurance policies with our carriers. Contract losses represent our best estimate of forward losses using currently available information and could change in future periods as new facts and circumstances emerge. The decrease in contract losses was primarily due to the utilization of the contract loss liability. Legal matters include reserves related to various lawsuits and claims that arise in the normal course of business. See Note 8 for further discussion. Other is comprised primarily of accrued rent and workers' compensation related claims and other balances that are not individually material to the consolidated financial statements. Other long-term liabilities As of March 25, 2016 and December 31, 2015 , Other long-term liabilities were $12.4 million and $13.6 million , respectively. Other long-term liabilities are primarily due to our long-term incentive bonus plan and nonqualified unfunded deferred compensation plan of $3.5 million and $4.4 million as of March 25, 2016 and December 31, 2015 , respectively, and a long-term leasehold obligation related to our Tysons Corner facility in McLean, Virginia, of $3.7 million and $3.8 million as of March 25, 2016 and December 31, 2015 , respectively. Other long-term liabilities also include an uncertain tax benefit of $3.3 million and $3.3 million as of March 25, 2016 and December 31, 2015 , respectively. See Note 4 for further discussion. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 25, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets We have two operating and reporting segments: DynAviation and DynLogistics. DynAviation and DynLogistics provide services domestically and in foreign countries primarily under contracts primarily with the U.S. government. Our current structure includes five reporting units: two reporting units in DynAviation and three reporting units in DynLogistics. Of our five reporting units, only two had a goodwill balance as of March 25, 2016 of which we assess for potential goodwill impairment. We assess goodwill and other intangible assets with indefinite lives for impairment annually in October or when an event occurs or circumstances change that would suggest a triggering event. If a triggering event is identified, a step one assessment is performed to identify any possible impairment in the period in which the event is identified. In connection with our annual assessment of goodwill during the fourth quarter of each year, we update our key assumptions, including our forecasts of revenue and income for each reporting unit. The projections for these reporting units include significant estimates related to new business opportunities. If we are unsuccessful in obtaining these opportunities in 2016, a triggering event could be identified and a step one assessment would be performed to identify any possible goodwill impairment in the period in which the event is identified. There can be no assurance that the estimates and assumptions regarding forecasted earnings and cash flows, the period of strength of the U.S. defense spending, and other inputs used in forecasting the present value of forecasted cash flows will prove to be accurate projections of future performance. During the three months ended March 25, 2016 , we did not have a triggering event in any of our reporting units. The carrying amounts of goodwill for each of our segments as of March 25, 2016 were as follows: (Amounts in thousands) DynAviation DynLogistics Total Goodwill balance as of December 31, 2015 $ — $ 42,093 $ 42,093 Changes between January 1, 2016 and March 25, 2016 — — — Goodwill balance as of March 25, 2016 $ — $ 42,093 $ 42,093 The following tables provide information about changes relating to certain intangible assets: As of March 25, 2016 (Amounts in thousands, except years) Weighted Average Remaining Useful Life (Years) Gross Carrying Value Accumulated Amortization Impairment Transfer to Assets Held for Sale Net Other intangible assets: Customer-related intangible assets 3.7 $ 252,615 $ (149,119 ) $ — $ — $ 103,496 Other Finite-lived 0.9 14,580 (10,834 ) — (31 ) 3,715 Indefinite-lived — — — — — Total other intangibles $ 267,195 $ (159,953 ) $ — $ (31 ) $ 107,211 Tradenames: Finite-lived 0.0 $ 869 $ (869 ) $ — $ — $ — Indefinite-lived 28,536 — — — 28,536 Total tradenames $ 29,405 $ (869 ) $ — $ — $ 28,536 December 31, 2015 (Amounts in thousands, except years) Weighted Gross Accumulated Impairment Transfer to Assets Held for Sale Net Other intangible assets: Customer-related intangible assets 4.0 $ 252,615 $ (142,020 ) $ — $ — $ 110,595 Other Finite-lived 0.7 13,325 (10,430 ) — (11 ) 2,884 Indefinite-lived 5,059 — (5,059 ) — — Total other intangibles $ 270,999 $ (152,450 ) $ (5,059 ) $ (11 ) $ 113,479 Tradenames: Finite-lived 0.0 $ 869 $ (869 ) $ — $ — $ — Indefinite-lived 28,700 — (164 ) — 28,536 Total tradenames $ 29,569 $ (869 ) $ (164 ) $ — $ 28,536 Amortization expense for customer-related intangible assets, other intangible assets and finite-lived tradenames was $7.5 million and $6.3 million for the three months ended March 25, 2016 and March 27, 2015 , respectively. Other intangible assets are primarily representative of our capitalized software which had a net carrying value of $3.7 million and $2.9 million as of March 25, 2016 and December 31, 2015 , respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 25, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The domestic and foreign components of Loss before income taxes are as follows: Three Months Ended (Amounts in thousands) March 25, 2016 March 27, 2015 Domestic $ (10,592 ) $ (11,325 ) Foreign 514 731 Loss before income taxes $ (10,078 ) $ (10,594 ) Deferred tax liabilities, net consist of the following: As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Current deferred tax liabilities, net $ — $ (27,334 ) Non-current deferred tax (liabilities) assets, net (16,495 ) 13,364 Deferred tax liabilities, net $ (16,495 ) $ (13,970 ) During the quarter ended March 25, 2016 , we adopted ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , which eliminates the current requirement to present deferred tax liabilities and assets as current and noncurrent amounts in a classified statement of financial position and requires us to classify all deferred tax assets and liabilities as noncurrent in a statement of financial position. We applied ASU 2015-17 prospectively and prior periods were not retroactively adjusted. Our effective tax rate ("ETR") was (44.6)% for the three months ended March 25, 2016 and (35.9)% for the three months ended March 27, 2015 , respectively. For both the three months ended March 25, 2016 and March 27, 2015 , the ETR was primarily impacted by an increase in our valuation allowance for each respective period. Management assesses both the available positive and negative evidence to determine whether it is more likely than not that there will be sufficient sources of future taxable income to recognize deferred tax assets. We incurred cumulative losses over the three-year period ended December 31, 2015 . Cumulative losses in recent years are considered significant objective negative evidence in evaluating deferred tax assets under the more likely than not criteria for recognition of deferred tax assets. As a result of additional losses for which we could not recognize a tax benefit, we increased our valuation allowance from $71.6 million as of December 31, 2015 to $78.7 million as of March 25, 2016 . As of March 25, 2016 and December 31, 2015 , we had $2.6 million of total unrecognized tax benefits, respectively, of which $2.3 million would impact our effective tax rate if recognized. We do not expect the unrecognized tax benefit of $3.3 million , inclusive of penalties, as of March 25, 2016 to be settled within the next twelve months. During the three months ended March 25, 2016 , we made no estimated federal income tax payments. All of our income taxes paid or refunds received during the three months ended March 25, 2016 were related to state or foreign jurisdictions. |
Accounts Receivable
Accounts Receivable | 3 Months Ended |
Mar. 25, 2016 | |
Receivables [Abstract] | |
Accounts Receivable | Accounts Receivable Accounts receivable, net consisted of the following: As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Billed $ 162,367 $ 136,127 Unbilled 219,265 249,970 Total accounts receivable, net $ 381,632 $ 386,097 Unbilled receivables as of March 25, 2016 and December 31, 2015 include $29.5 million and $21.3 million , respectively, related to costs incurred on projects for which we have been requested by the customer to begin new work or extend work under an existing contract and for which formal contracts, contract modifications or other contract actions have not been executed as of the end of the respective periods. As of March 25, 2016 and December 31, 2015 , we had no significant accounts receivable balances associated with contract claims. The balance of unbilled receivables above consists of costs and fees billable immediately upon contract completion or other specified events, all of which are expected to be billed and collected within one year, except items that may result in a request for equitable adjustment or formal claim. We do not believe we have significant exposure to credit risk as our receivables are primarily with the U.S. government. Our allowance for doubtful accounts was $16.3 million as of December 31, 2015 compared to $16.4 million as of March 25, 2016 , and is primarily due to outstanding receivables of approximately $26.0 million , net of reserves, for which we have yet to be paid where we operated under a subcontract for a prime contractor on a U.S. government program that ended December 31, 2014 . We are currently seeking payment through legal action to resolve the matter. See Note 8 for further discussion. |
Fair Value of Financial Assets
Fair Value of Financial Assets and Liabilities | 3 Months Ended |
Mar. 25, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Assets and Liabilities | Fair Value of Financial Assets and Liabilities ASC 820 – Fair Value Measurements and Disclosures establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: • Level 1, defined as observable inputs such as quoted prices in active markets; • Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and • Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. Fair Value of Financial Instruments Our financial instruments include cash and cash equivalents, accounts receivable, accounts payable, and borrowings. Because of the short-term nature of cash and cash equivalents, accounts receivable, and accounts payable, the fair value of these instruments approximates the carrying value. Our estimate of the fair value of our debt is based on Level 1 and Level 2 inputs, as defined above. As Of March 25, 2016 December 31, 2015 (Amounts in thousands) Carrying Amount Fair Value Carrying Amount Fair Value 10.375% senior unsecured notes $ 455,000 $ 360,019 $ 455,000 $ 337,838 Term Loan 187,272 180,249 187,272 179,781 Total indebtedness 642,272 540,268 642,272 517,619 Less current portion of long-term debt (187,272 ) (180,249 ) (187,272 ) (179,781 ) Total long-term debt $ 455,000 $ 360,019 $ 455,000 $ 337,838 |
Debt
Debt | 3 Months Ended |
Mar. 25, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consisted of the following: As of March 25, 2016 (Amounts in thousands) Carrying Amount Deferred Financing Costs, Net Carrying Amount less Deferred Financing Costs, Net 10.375% senior unsecured notes $ 455,000 $ (2,395 ) $ 452,605 Term loan 187,272 (1,324 ) 185,948 Total indebtedness 642,272 (3,719 ) 638,553 Less current portion of long-term debt (187,272 ) 1,324 (185,948 ) Total long-term debt $ 455,000 $ (2,395 ) $ 452,605 As of December 31, 2015 (Amounts in thousands) Carrying Amount Deferred Financing Costs, Net Carrying Amount less Deferred Financing Costs, Net 10.375% senior unsecured notes $ 455,000 $ (2,835 ) $ 452,165 Term loan 187,272 (2,406 ) 184,866 Total indebtedness 642,272 (5,241 ) 637,031 Less current portion of long-term debt (187,272 ) 2,406 (184,866 ) Total long-term debt $ 455,000 $ (2,835 ) $ 452,165 We adopted ASU 2015-03 as of March 25, 2016 and applied its provisions retrospectively. The adoption of ASU 2015-03 resulted in the reclassification of current deferred financing costs, net, of $2.4 million related to our Term Loan and Revolver from Prepaid expenses and other current assets to the Current portion of long-term debt and the reclassification of deferred financing costs, net, of $2.8 million related to our Senior Unsecured Notes from Other assets, net, to Long-term debt within its consolidated balance sheets as of December 31, 2015 . See Note 1 for further discussion. Deferred financing costs are amortized through interest expense. Amortization related to deferred financing costs was $1.5 million and $1.5 million during the three months ended March 25, 2016 and March 27, 2015 , respectively. Senior Credit Facility On July 7, 2010 , we entered into a senior secured credit facility (the "Senior Credit Facility"), with a banking syndicate and Bank of America, NA as Administrative Agent (the "Agent"). On January 21, 2011 , August 10, 2011 , June 19, 2013 and November 5, 2014 , DynCorp International Inc. entered into amendments to the Senior Credit Facility. The Senior Credit Facility is secured by substantially all of our assets and is guaranteed by substantially all of our subsidiaries. As of March 25, 2016 , the Senior Credit Facility provided for a $187.3 million Term Loan and the $144.8 million Revolver, which includes a $100.0 million letter of credit subfacility. As of March 25, 2016 and December 31, 2015 , the available borrowing capacity under the Senior Credit Facility was approximately $102.2 million and $102.2 million , respectively, and includes $42.6 million and $42.6 million , respectively, in issued letters of credit. Amounts borrowed under the Revolver are used to fund operations. As of March 25, 2016 and December 31, 2015 there were no amounts borrowed under the Revolver. Giving effect to the Senior Credit Facility Waiver, available borrowing capacity under the Senior Credit Facility as of the date of this report (taking into account the existing $42.6 million in issued letters of credit) would be approximately $29.8 million . The current portion of long-term debt as of March 25, 2016 consisted of our Term Loan and the Revolver as both have a maturity date of July 7, 2016 (before giving effect to the New Senior Credit Facility and the Other Refinancing Transactions). As described in Note 1, on April 30, 2016 , the Company entered into Amendment No. 5 as part of the Refinancing Transactions. The independent registered public accounting firm that audited our financial statements for the year ended December 31, 2015 included an explanatory paragraph in its audit report regarding our ability to continue as a going concern. Pursuant to Amendment No. 5, required lenders under the Senior Credit Facility agreed to the Senior Credit Facility Waiver, which waives the requirement to comply with the covenant under the Senior Credit Facility that the Company’s annual financial statements include a report from its independent registered public accounting firm without a qualification as to the Company’s ability to continue as a going concern until the earlier of the effectiveness of the New Senior Credit Facility (at which time the waiver of this requirement for the fiscal year ended December 31, 2015 would become permanent) and June 30, 2016 . During the effectiveness of the Senior Credit Facility Waiver, unless the effectiveness of the New Senior Credit Facility has occurred, the aggregate amount of outstanding revolving loans and letters of credit may not exceed 50% of the aggregate revolving credit commitments under the Senior Credit Facility. In addition, during the waiver period, any proceeds of revolving loans may only be used for working capital purposes and in the ordinary course of business for other general corporate purposes. The Company may not use the proceeds of revolving loans for dividends, prepayments of any junior debt or acquisition financing. Upon the satisfaction of certain conditions, including consummation of the Exchange Offer and the other Refinancing Transactions, the New Senior Credit Facility shall become effective, and the Senior Credit Facility Waiver will become permanent. Pursuant to the terms of the New Senior Credit Facility, among other things, the maturity of certain of the revolving credit commitments shall be extended into the Extended Revolving Credit Facility and certain lenders will provide the New Term Loan Facility, the proceeds of which will be used to repay the existing term loans under the Senior Credit Facility in full. Upon its effectiveness, the New Senior Credit Facility will consist of: • a $207.3 million New Term Loan Facility; • a $24.8 million class A revolving facility, with commitments to terminate on July 7, 2016 , as more fully described below; • a $107.3 million Extended Revolving Credit Facility, a class B revolving facility, provided that each revolving lender’s class B revolving facility commitment shall be reduced by 20% on June 24, 2016 (or if the effective date of the New Senior Credit Facility occurs after June 24, 2016 , on the effective date of the New Senior Credit Facility), unless such lender declines such reduction; and • up to $15.0 million in incremental revolving facilities provided by and at the discretion of certain non-debt fund affiliates that are controlled by Cerberus, which shall rank pari passu with, and be on the same terms as, the class B revolving facility. Upon closing of the Exchange Offer and the other Refinancing Transactions, the term loans under the New Senior Credit Facility will be subject to a fee in the amount of 700 basis points, which fee will be reflected as original issue discount in the balance of the New Term Loan Facility, and each of the lenders holding class B revolving facility commitments on the effective date of the New Senior Credit Facility will be paid an upfront fee equal to 2.00% of the class B revolving facility commitment held by such lender. Availability under the class B revolving facility during the two years immediately after the effectiveness of the New Senior Credit Facility will be subject to a condition that, if, at the time of a request for revolving loans or an issuance of a letter of credit, the aggregate principal amount of revolving loans plus the face amount of outstanding letters of credit exceeds 50% of the aggregate amount of class B revolving facility commitments at such time, the aggregate amount of unrestricted cash and cash equivalents of DynCorp International Inc. and its subsidiaries (giving pro forma effect to requested revolving loans and any application of proceeds thereof or other cash on hand) may not exceed $60 million . Interest Rates on Term Loan & Revolver Under the Senior Credit Facility, both the Term Loan and Revolver bear interest at one of two options, based on our election, using either the (i) base rate ("Base Rate") as defined in the Senior Credit Facility plus an applicable margin or the (ii) London Interbank Offered Rate ("Eurocurrency Rate") as defined in the Senior Credit Facility plus an applicable margin. The applicable margin for the Term Loan is fixed at 3.5% for the Base Rate option and 4.5% for the Eurocurrency Rate option. The applicable margin for the Revolver ranges from 3.0% to 3.5% for the Base Rate option or 4.0% to 4.5% for the Eurocurrency Rate option based on our Secured Leverage Ratio at the end of the quarter. The Secured Leverage Ratio is calculated by the ratio of total secured consolidated debt (net of up to $75 million of unrestricted cash and cash equivalents) to consolidated earnings before interest, taxes, depreciation and amortization ("Consolidated EBITDA"), as defined in the Senior Credit Facility. Interest payments on both the Term Loan and Revolver are payable at the end of the interest period as defined in the Senior Credit Facility, but not less than quarterly. Under the Senior Credit Facility, the Base Rate is equal to the higher of (a) the Federal Funds Rate plus one half of one percent and (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its prime rate; provided that in no event shall the Base Rate be less than 1.00% plus the Eurocurrency Rate applicable to one month interest periods on the date of determination of the Base Rate. The variable Base Rate has a floor of 2.75% . Under the New Senior Credit Facility, upon closing of the Exchange Offer and the other Refinancing Transactions, the interest rate per annum applicable to the term loans will be, at our option, equal to either a base rate or a eurocurrency rate for a one-, two-, three- or six-month interest period, or a twelve-month period, if available from all relevant lenders, in each case, plus (i) 5.00% in the case of base rate loans and (ii) 6.00% in the case of eurocurrency loans. The interest rate per annum applicable to the class A revolving loans will be, at our option, equal to either a base rate or a eurocurrency rate for a one-, two-, three- or six-month interest period, or a twelve-month period, if available from all relevant lenders, in each case, plus (i) a range of 3.00% to 3.50% based on the Secured Leverage Ratio of DynCorp International Inc. in the case of base rate loans and (ii) a range of 4.00% to 4.50% based on the Secured Leverage Ratio of DynCorp International Inc. in the case of eurocurrency loans. The interest rate per annum applicable to the class B revolving loans will be, at our option, equal to either a base rate or a eurocurrency rate for a one-, two-, three- or six-month interest period, or a twelve-month period, if available from all relevant lenders, in each case, plus (i) a range of 4.50% to 5.00% based on the First-Lien Secured Leverage Ratio of DynCorp International Inc. in the case of base rate loans and (ii) a range of 5.50% to 6.00% based on the First-Lien Secured Leverage Ratio of DynCorp International Inc. in the case of eurocurrency loans. The First Lien Secured Leverage Ratio is calculated by the ratio of total first lien secured consolidated debt (net of up to $75 million of unrestricted cash and cash equivalents) to Consolidated EBITDA, as defined in the New Senior Credit Facility. Under the New Senior Credit Facility, upon closing of the Exchange Offer and the other Refinancing Transactions, the Eurocurrency loans will be based on LIBOR and will be no lower than 1.75% . The base rate means the greater of (i) Bank of America’s prime rate and (ii) one-half of 1.0% over the weighted average of rates on overnight Federal Funds as published by the Federal Reserve Bank of New York; however, in no event shall the base rate be lower than the applicable eurocurrency rate plus 1.00% . Under the Senior Credit Facility and under the New Senior Credit Facility, the Eurocurrency Rate is the rate per annum equal to the British Bankers Association London Interbank Offered Rate ("BBA LIBOR") as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by the Administrative Agent from time to time) two business days prior to the commencement of such interest period. The variable Eurocurrency Rate has a floor of 1.75% . As of March 25, 2016 and December 31, 2015 , the interest rate on the Term Loan was 6.25% . Interest Rates on Letter of Credit Subfacility and Unused Commitment Fees Under the Senior Credit Facility, the letter of credit subfacility bears interest at an applicable rate that ranges from 4.0% to 4.5% . The unused commitment fee on our Revolver ranges from 0.50% to 0.75% depending on the Secured Leverage Ratio. Interest payments on both the letter of credit subfacility and unused commitments are payable quarterly in arrears. The applicable interest rates for our letter of credit subfacility was 4.25% as of each of March 25, 2016 and December 31, 2015 . The applicable interest rate for our unused commitment fees was 0.50% as of each of March 25, 2016 and December 31, 2015 . All of our letters of credit are also subject to a 0.25% fronting fee. Under the New Senior Credit Facility, upon closing of the Exchange Offer and the other Refinancing Transactions, the letter of credit subfacility bears interest at an applicable rate that from 4.0% to 4.5% with respect to the class A revolving loans and ranges from 5.5% to 6.0% with respect to the class B revolving loans. The unused commitment fee on our Revolver ranges from 0.50% to 0.75% depending on the Secured Leverage Ratio with respect to the class A revolving loans and depending on the First Lien Secured Leverage Ratio with respect to the class B revolving loans. Interest payments on both the letter of credit subfacility and unused commitments are payable quarterly in arrears. Principal Payments Pursuant to our Term Loan under the Senior Credit Facility, quarterly principal payments are required. However, certain principal prepayments made during the year ended December 30, 2011 were applied to the future scheduled maturities and satisfied our responsibility to make quarterly principal payments through July 7, 2016 . During the three months ended March 25, 2016 and March 27, 2015 , we made no principal payments on the Term Loan, respectively. Our Senior Credit Facility contains an annual requirement to submit a portion of our Excess Cash Flow, as defined in the Senior Credit Facility, as additional principal payments. Based on our annual financial results for the year ended December 31, 2015 , we made an additional principal payment as required under the Excess Cash Flow provision of $4.6 million on April 6, 2016 . Certain other transactions can trigger mandatory principal payments such as tax refunds, a disposition of a portion of our business or a significant asset sale. We had no such transactions during the three months ended March 25, 2016 . After its effectiveness upon closing of the Exchange Offer and the other Refinancing Transactions, the New Senior Credit Facility will contain an annual requirement to submit 100% of Excess Cash Flow (as defined in Amendment No. 5) less the amount of certain voluntary prepayments as described in Amendment No. 5, as additional principal payments. Certain other transactions can trigger mandatory principal payments such as tax refunds, a disposition of a portion of our business or a significant asset sale. Under the New Senior Credit Facility, upon closing of the Exchange Offer and the other Refinancing Transactions, we will be required to make amortization payments with respect to the term loans under the New Senior Credit Facility of $22.5 million on or prior to the first anniversary of the effectiveness of the New Senior Credit Facility and $22.5 million on or prior to the second anniversary of the effectiveness of the New Senior Credit Facility, which amounts may be reduced as a result of the application of certain prepayments, with the remaining amount payable on July 7, 2020 ; provided that, if on May 8, 2017 , any Senior Unsecured Notes are outstanding, unless the maturity date of all of the Senior Unsecured Notes has been extended to a date that is at least 91 days after July 7, 2020 , the principal amounts outstanding under the New Term Loan Facility will be due and payable in full on, and the commitments in respect thereof will terminate on, May 8, 2017 . After the effectiveness of the New Senior Credit Facility upon closing of the Exchange Offer and the other Refinancing Transactions, principal amounts outstanding under the class A revolving facility will be due and payable in full on, and the commitments in respect thereof will terminate on, July 7, 2016 , and principal amounts outstanding under the class B revolving facility will be due and payable in full on, and the commitments in respect thereof will terminate on, July 7, 2019 ; provided that, with respect to the class B revolving facility, if on May 8, 2017 , any Senior Unsecured Notes are outstanding, unless the maturity date of all of the Senior Unsecured Notes has been extended to a date at least 91 days after July 7, 2020 , the principal amounts outstanding under the class B revolving facility will be due and payable in full on, and the commitments in respect thereof will terminate on, May 8, 2017 . Covenants The Senior Credit Facility contains, and the New Senior Credit Facility upon closing of the Exchange Offer and the other Refinancing Transactions will contain, financial, as well as non-financial, affirmative and negative covenants that we believe are usual and customary. These covenants, among other things, limit our ability to: • declare dividends and make other distributions; • redeem or repurchase our capital stock; • prepay, redeem or repurchase certain of our indebtedness; • grant liens; • make loans or investments (including acquisitions); • incur additional indebtedness; • modify the terms of certain debt; • restrict dividends from our subsidiaries; • change our business or business of our subsidiaries; • merge or enter into acquisitions; • sell our assets; • enter into transactions with our affiliates; and • make capital expenditures. In addition, the Senior Credit Facility contains, and the New Senior Credit Facility upon closing of the Exchange Offer and the other Refinancing Transactions will contain, two financial maintenance covenants, a maximum total leverage ratio and a minimum interest coverage ratio. In the Senior Credit Facility, the total leverage ratio is the Consolidated Total Debt, as defined in the Senior Credit Facility, less unrestricted cash and cash equivalents (up to $75.0 million ) to Consolidated EBITDA, as defined in the Senior Credit Facility, for the applicable period. The maximum total leverage ratios under the Senior Credit Facility are set forth below as follows: Period Ending Total Leverage Ratio March 25, 2016 7.60 to 1.0 June 24, 2016 6.90 to 1.0 June 25, 2016 and thereafter 6.60 to 1.0 The interest coverage ratio is the ratio of Consolidated EBITDA to Consolidated Interest Expense, as defined in the Senior Credit Facility. The minimum interest coverage ratios under the Senior Credit Facility are set forth below as follows: Period Ending Interest Coverage Ratio March 25, 2016 1.15 to 1.0 June 24, 2016 1.20 to 1.0 June 25, 2016 and thereafter 1.30 to 1.0 As of March 25, 2016 and December 31, 2015 , we were in compliance with our financial maintenance covenants. After the effectiveness of the New Senior Credit Facility upon closing of the Exchange Offer and the other Refinancing Transactions, the covenants in the New Senior Credit Facility will be more restrictive than the covenants in the Senior Credit Facility. The New Senior Credit Facility will also require, solely for the benefit of the lenders under the Extended Revolving Credit Facility, for us to maintain minimum liquidity (based on availability of revolving credit commitments under the New Senior Credit Facility plus unrestricted cash and cash equivalents) as of the end of each fiscal quarter of not less than $60 million through the fiscal quarter ending December 31, 2017 , and of not less than $50 million thereafter. After the effectiveness of the New Senior Credit Facility upon closing of the Exchange Offer and the other Refinancing Transactions, the total leverage ratio will be the Consolidated Total Debt, as defined in Amendment No. 5 (which definition excludes debt under the Cerberus 3L Notes), less unrestricted cash and cash equivalents (up to $75.0 million ) to Consolidated EBITDA, as defined in Amendment No. 5, for the applicable period. The maximum total leverage ratios under the New Senior Credit Facility are set forth below as follows: Period Ending Total Leverage Ratio March 25, 2016 7.60 to 1.0 June 24, 2016 7.40 to 1.0 September 30, 2016 7.50 to 1.0 December 31, 2016 7.40 to 1.0 March 31, 2017 7.30 to 1.0 June 30, 2017 6.75 to 1.0 September 29, 2017 6.50 to 1.0 December 31, 2017 5.75 to 1.0 March 30, 2018 5.75 to 1.0 June 29, 2018 5.50 to 1.0 September 28, 2018 5.40 to 1.0 September 29, 2018 and thereafter 4.75 to 1.0 After the effectiveness of the New Senior Credit Facility upon closing of the Exchange Offer and the other Refinancing Transactions, the interest coverage ratio will be the ratio of Consolidated EBITDA to Consolidated Interest Expense, as defined in Amendment No. 5 (which provides that interest expense with respect to the Cerberus 3L Notes is excluded). The minimum interest coverage ratios under the New Senior Credit Facility are set forth below as follows: Period Ending Interest Coverage Ratio March 25, 2016 1.15 to 1.0 June 24, 2016 1.15 to 1.0 September 30, 2016 1.15 to 1.0 December 31, 2016 1.15 to 1.0 March 31, 2017 1.20 to 1.0 June 30, 2017 1.20 to 1.0 September 29, 2017 1.30 to 1.0 December 31, 2017 1.40 to 1.0 March 30, 2018 1.50 to 1.0 June 29, 2018 1.60 to 1.0 June 30, 2018 and thereafter 1.70 to 1.0 Senior Unsecured Notes On July 7, 2010 , DynCorp International Inc. completed an offering of $455.0 million in aggregate principal of 10.375% senior unsecured notes due 2017 (the "Senior Unsecured Notes"). The initial purchasers were Bank of America Securities LLC, Citigroup Global Markets Inc., Barclays Capital Inc. and Deutsche Bank Securities Inc. The Senior Unsecured Notes were issued under an indenture dated July 7, 2010 (the "Indenture"), by and among us, the guarantors party thereto (the "Guarantors"), including DynCorp International Inc., and Wilmington Trust, National Association (as successor by merger to Wilmington Trust FSB) as Trustee. The Senior Unsecured Notes mature on July 1, 2017 . Interest on the Senior Unsecured Notes is payable on January 1 and July 1 of each year, and commenced on January 1, 2011 . The Senior Unsecured Notes contain various covenants that restrict our ability to: • incur additional indebtedness; • make certain payments, including declaring or paying certain dividends; • purchase or retire certain equity interests; • retire subordinated indebtedness; • make certain investments; • sell assets; • engage in certain transactions with affiliates; • create liens on assets; • make acquisitions; and • engage in mergers or consolidations. The aforementioned restrictions are considered to be in place unless we achieve investment grade ratings by both Moody’s Investor Services and Standard and Poor’s. An event of default under the Senior Credit Facility based on a failure to pay the principal due at the scheduled maturity or upon acceleration would also cause an event of default under the Senior Unsecured Notes. See Note 1 for a description of the Support Agreement, Exchange Offer and Consent Solicitation with respect to the Senior Unsecured Notes. Call and Put Options We can voluntarily settle all or a portion of the Senior Unsecured Notes at any time prior to maturity at an applicable redemption price plus the accrued and unpaid interest, if any, as of the applicable redemption date. The applicable redemption prices with respect to the Senior Unsecured Notes on any applicable redemption date if redeemed during the 12-month period commencing on July 1 of the years set forth below are as follows: Year Redemption Price 2015 102.6 % 2016 and thereafter 100.0 % The Indenture requires us to offer to repurchase the Senior Unsecured Notes at defined prices in the event of certain asset sales and change of control events. In the case of Asset Sales, as defined in the Indenture, we are required under the Indenture to use the proceeds from such asset sales to either (i) prepay secured debt or nonguarantor debt, (ii) reinvest in our business or (iii) to the extent asset sale proceeds not applied in accordance with clause (i) or (ii) exceed $15.0 million , make an offer to repurchase the Senior Unsecured Notes at 100% of the principal amount thereof. In the event of a change in control, each holder of the Senior Unsecured Notes will have the right to require the Company to repurchase some or all of the Senior Unsecured Notes at 101% of their face amount, plus accrued and unpaid interest to the repurchase date. The fair value of the Senior Unsecured Notes is based on their quoted market value. As of March 25, 2016 and December 31, 2015 , the quoted market value of the Senior Unsecured Notes was approximately 79.1% and 74.3% , respectively, of stated value. Cerberus 3L Notes As described in Note 1, on April 30, 2016 , DynCorp Funding LLC, a limited liability company managed by Cerberus, delivered to us the Cerberus Investment Commitment Letter to provide $30 million of the Cerberus 3L Notes upon satisfaction of certain conditions, including consummation of the Exchange Offer. We expect that the proceeds of the Cerberus 3L Notes will be used by DynCorp International Inc. solely to pay fees and expenses (including out-of-pocket expenses) in support of or related to the Company’s Global Advisory Group until the date that is two years after the funding of the Cerberus 3L Notes and, thereafter, for working capital and general corporate purposes. Interest Rate and Fees We expect the interest rate per annum applicable to the Cerberus 3L Notes will be 5.00% , payable in kind on a quarterly basis. Prepayments We expect that the Cerberus 3L Notes will not require any mandatory prepayments, and, subject to the terms of an intercreditor agreement, to be entered into by the collateral agent under the New Notes, the trustee under the New Notes, the Agent under the New Senior Credit Facility, and the lenders under the Cerberus 3L Notes (or a collateral agent on behalf of lenders thereunder), that we will be permitted to voluntarily repay outstanding loans under the Cerberus 3L Notes without premium or penalty. Maturity and Amortization We expect that the Cerberus 3L Notes will not require any mandatory amortization payments prior to maturity, and that the outstanding principal amounts shall be payable on the tenth anniversary of the funding of the Cerberus 3L Notes. Covenants We expect that the Cerberus 3L Notes will include covenants consistent with the covenants set forth in the New Notes; provided that each “basket” or “cushion” set forth in the covenants shall be at least 25% less restrictive than the corresponding provision set forth in the New Notes. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 25, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments We have operating leases for the use of real estate and certain property and equipment which are either non-cancelable, cancelable only by the payment of penalties or cancelable upon one month’s notice. All lease payments are based on the lapse of time but include, in some cases, payments for insurance, maintenance and property taxes. There are no purchase options on operating leases at favorable terms, but most leases have one or more renewal options. Certain real estate leases are subject to annual escalations for increases in base rents, utilities and property taxes. Lease rental expense was $8.2 million and $14.0 million for the three months ended March 25, 2016 and March 27, 2015 , respectively. We have no significant long-term purchase agreements with service providers. Contingencies General Legal Matters We are involved in various lawsuits and claims that arise in the normal course of business. We have established reserves for matters in which it is believed that losses are probable and can be reasonably estimated. Reserves related to these matters have been recorded in Other accrued liabilities totaling approximately $4.6 million and $5.1 million as of March 25, 2016 and December 31, 2015 , respectively. We believe that appropriate accruals have been established for such matters based on information currently available; however, some of the matters may involve compensatory, punitive, or other claims or sanctions that, if granted, could require us to pay damages or make other expenditures in amounts that could not be reasonably estimated at March 25, 2016 . These accrued reserves represent the best estimate of amounts believed to be our liability in a range of expected losses. In addition to matters that are considered probable and that can be reasonably estimated, we also have certain matters considered reasonably possible. Other than matters disclosed below, we believe the aggregate range of possible loss related to matters considered reasonably possible was not material as of March 25, 2016 . Litigation is inherently unpredictable and unfavorable resolutions could occur. Accordingly, it is possible that an adverse outcome from such proceedings could (i) exceed the amounts accrued for probable matters; or (ii) require a reserve for a matter we did not originally believe to be probable or could be reasonably estimated. Such changes could be material to our financial condition, results of operations and cash flows in any particular reporting period. Our view of the matters not specifically disclosed could possibly change in future periods as events thereto unfold. Pending Litigation and Claims On December 4, 2006 , December 29, 2006 , March 14, 2007 and April 24, 2007 , four lawsuits were served, seeking unspecified monetary damages against DynCorp International LLC and several of its former affiliates in the U.S. District Court for the Southern District of Florida, concerning the spraying of narcotic plant crops along the Colombian border adjacent to Ecuador. Three of the lawsuits, filed on behalf of the Provinces of Esmeraldas, Sucumbíos, and Carchi in Ecuador, allege violations of Ecuadorian law, International law, and statutory and common law tort violations, including negligence, trespass, and nuisance. The fourth lawsuit, filed on behalf of citizens of the Ecuadorian provinces of Esmeraldas and Sucumbíos, alleges personal injury, various counts of negligence, trespass, battery, assault, intentional infliction of emotional distress, violations of the Alien Tort Claims Act and various violations of International law. The four lawsuits were consolidated, and based on our motion granted by the court, the case was subsequently transferred to the U.S. District Court for the District of Columbia. On March 26, 2008 , a First Amended Consolidated Complaint was filed that identified 3,266 individual plaintiffs. As of January 12, 2010 , 1,256 of the plaintiffs were dismissed by court orders and, on September 15, 2010 , the Provinces of Esmeraldas, Sucumbíos, and Carchi were dismissed by court order. We filed multiple motions for summary judgment and, on February 15, 2013 , the court granted summary judgment and dismissed all claims. On March 18, 2013 , the plaintiffs filed a notice of appeal with the U.S. Court of Appeals for the District of Columbia. On May 30, 2014 , the U.S. Court of Appeals for the District of Columbia affirmed the dismissal of the majority of the case, but remanded the case to the trial court concerning a few remaining tort claims. At this time, we believe the likelihood of an unfavorable outcome in this case is remote. A lawsuit filed on September 11, 2001 , and amended on March 24, 2008 , seeking unspecified damages on behalf of twenty-six residents of the Sucumbíos Province in Ecuador, was brought against our operating company and several of its former affiliates in the U.S. District Court for the District of Columbia. The action alleges violations of the laws of nations and U.S. treaties, negligence, emotional distress, nuisance, battery, trespass, strict liability, and medical monitoring arising from the spraying of herbicides near the Ecuador-Colombia border in connection with the performance of the DoS, International Narcotics and Law Enforcement contract for the eradication of narcotic plant crops in Colombia. As of January 12, 2010 , fifteen of the plaintiffs have been dismissed by court order. We filed multiple motions for summary judgment and, on February 15, 2013 , the court granted summary judgment and dismissed all claims. On March 18, 2013 , the plaintiffs filed a notice of appeal with the U.S. Court of Appeals for the District of Columbia. On May 30, 2014, the U.S. Court of Appeals for the District of Columbia affirmed the dismissal of the majority of the case, but remanded the case to the trial court concerning a few remaining tort claims. We filed another motion for summary judgment, which is fully briefed and remains pending. The terms of the DoS contract provide that the DoS will indemnify our operating company against third party liabilities arising out of the contract, subject to available funding. We are also entitled to indemnification by Computer Sciences Corporation, the Company’s previous owners, in connection with this lawsuit, subject to certain limitations. Additionally, any damage award would have to be apportioned between the other defendants and our operating company. We believe that the likelihood of an unfavorable judgment in this matter is remote. Arising out of the litigation described in the preceding two paragraphs, on September 22, 2008 , we filed a separate lawsuit against our aviation insurance carriers seeking defense and coverage of the referenced claims. On November 9, 2009 , the court granted our Partial Motion for Summary Judgment regarding the duty to defend, and the carriers have paid the majority of the litigation expenses. In a related action, the carriers filed a lawsuit against us on February 5, 2009 , seeking rescission of certain aviation insurance policies based on an alleged misrepresentation by us concerning the existence of certain of the lawsuits relating to the eradication of narcotic plant crops. On May 19, 2010 , our aviation insurance carriers filed a complaint against us seeking reformation of previously provided insurance policies and the elimination of coverage for aerial spraying. We believe the claims asserted by the insurance carriers are without merit and the likelihood of an unfavorable judgment in this matter is remote. In October 2007 , we entered into a subcontract with Northrop Grumman Technical Services, Inc. (“Northrop”) to support Northrop’s prime contract with the DoD Counter Narcotics Terrorism Program Office ("CNTPO"). We performed the services requested by Northrop, the government determined that it received “intended quality and skills of personnel,” and Northrop paid our invoices until July 2014 . Subsequent to July 2014 , Northrop stopped paying our periodic invoices. The contract operations ended on December 31, 2014 . In March 2015 , Northrop filed a civil action against us to obtain documents regarding our invoices and now asserts approximately $5 million in damages. We believe the damages asserted by Northrop represent a loss contingency that is remote. In September 2015 , we filed an Answer and Counterclaim seeking approximately $41 million for unpaid invoices. An unfavorable judgment which denies us a substantial amount of the full amount owed to us could have a material effect on our performance. U.S. Government Investigations We primarily sell our services to the U.S. government. These contracts are subject to extensive legal and regulatory requirements, and we are occasionally the subject of investigations by various agencies of the U.S. government who investigate whether our operations are being conducted in accordance with these requirements. Such investigations, whether related to our U.S. government contracts or conducted for other reasons, could result in administrative, civil or criminal liabilities, including repayments, fines or penalties being imposed on us, or could lead to suspension or debarment from future U.S. government contracting. U.S. government investigations often take years to complete and many result in adverse action against us. We believe that any adverse actions arising from such matters could have a material effect on our ability to invoice and receive timely payment on our contracts, perform contracts or compete for contracts with the U.S. government and could have a material effect on our operating performance. On February 24, 2012, we were advised by the Department of Justice Civil Litigation Division that they are conducting an investigation regarding the CivPol and Department of State Advisor Support Mission ("DASM") contracts in Iraq and Corporate Bank, a former subcontractor. The issues include allowable hours worked under a specific task order and invoices to the Department of State for certain hotel leasing, labor rates and overhead within the 2003 to 2008 timeframe. The Department of Justice Civil Litigation Division has requested information from the Company, and we are fully cooperating with the government’s review. If our operations are found to be in violation of any laws or government regulations, we may be subject to penalties, damages or fines, any or all of which could adversely affect our financial results. At this time, an estimate or a range of potential damages is not possible as this matter is still under review by the Department of Justice and no formal complaint has been filed. U.S. Government Audits Our contracts are regularly audited by the Defense Contract Audit Agency ("DCAA") and other government agencies. These agencies review our contract performance, cost structure and compliance with applicable laws, regulations and standards. The government also reviews the adequacy of, and our compliance with, our internal control systems and policies, including our purchasing, property, estimating, accounting and material management business systems. Any costs found to be improperly allocated to a specific contract will not be reimbursed. The DCAA will in some cases issue a Form 1 representing the non-conformance of such costs or requirements as it relates to our government contracts. If we are unable to provide sufficient evidence of the costs in question, the costs could be suspended or disallowed which could be material to our financial statements. Government contract payments received by us for direct and indirect costs are subject to adjustment after government audit and repayment to the government if the payments exceed allowable costs as defined in the government regulations. On our CivPol program, we had received a series of audit reports and related Form 1s from the DCAA based on their examination of certain incurred, invoiced and reimbursed costs. Over the course of multiple years, we have worked extensively with the DoS to settle the outstanding issues. Through our efforts, which included a series of contract actions (e.g. modifications) and negotiations, the issues have been resolved, resulting in final settlements of all audited costs of approximately $1.4 million . On April 30, 2013 , we received several Form 1s from the DCAA for the periods ranging between 2000 to 2011 on the War Reserve Materiel program related to concerns on items such as the adequacy of documentation and reasonableness of costs. We are working with the Air Force to resolve these questions. Based on our recent correspondence with the customer, a substantial portion of these items represent loss contingencies that are remote. The remaining portion of these items totaling $1.8 million represent loss contingencies that we consider reasonably possible; however, we do anticipate resolving these contingencies for an immaterial amount as we continue to work with the customer. We have received a series of audit reports from the DCAA related to their examination of certain incurred, invoiced and reimbursed costs on the LOGCAP IV. In April 2016, we received two draft Form 1s from the DCAA questioning approximately $48.0 million and we believe more could be issued in the future. Over the past several years, we have been successful in working with the DCAA, Defense Contract Management Agency and our customer in resolving matters included in Form 1s as well as other transmittals. Specific to the LOGCAP IV audit reports, we have provided responses to the DCAA that have articulated our position on each issue and have attempted to answer their questions and provide clarification of the facts to resolve the issues raised. We are currently in process of reviewing and responding to the draft Form 1s recently received. While we believe that if final Form 1s are received we will be successful in defending our position, there can be no guarantees that we will be able to address all of their concerns or entirely avoid financial loss. Foreign Contingencies On January 22, 2014 , a tax assessment from the Large Tax Office of the Afghanistan Ministry of Finance (“MOF”) was received, seeking approximately $64.2 million in taxes and penalties specific to one of our business licenses in Afghanistan for periods between 2009 to 2012. The majority of this assessment was income tax related; however, $10.2 million of the assessed amount is non-income tax related and represents loss contingencies that we consider reasonably possible. We filed our initial appeal of the assessment with the MOF on February 19, 2014 . In May 2014 , the MOF ruled in our favor for the income tax related issue which totaled approximately $54.0 million . We are still working with the MOF to remove the assessment on the remaining non-income tax related items. As of March 25, 2016 , a reasonable estimate of loss or range of loss could not be made as we could not reasonably estimate the ultimate outcome related to the issues assessed. Credit Risk We are subject to concentrations of credit risk primarily by virtue of our accounts receivable. Departments and agencies of the U.S. federal government account for all but minor portions of our customer base, minimizing this credit risk. Furthermore, we continuously review all accounts receivable and record provisions for doubtful accounts when necessary. Risk Management Liabilities and Reserves We are insured for domestic workers' compensation liabilities and a significant portion of our employee medical costs. However, we bear risk for a portion of claims pursuant to the terms of the applicable insurance contracts. We account for these programs based on actuarial estimates of the amount of loss inherent in that period's claims, including losses for which claims have not been reported of $10.7 million and $11.0 million as of March 25, 2016 and December 31, 2015 , respectively. These loss estimates rely on actuarial observations of ultimate loss experience for similar historical events. We limit our risk by purchasing stop-loss insurance policies for significant claims incurred for both domestic workers' compensation liabilities and medical costs. Our exposure under the stop-loss policies for domestic workers' compensation and medical costs is limited based on fixed dollar amounts. For domestic workers' compensation and employers' liability under state and federal law, the fixed dollar amount of stop-loss coverage is $1.0 million per occurrence on most policies; but, $0.25 million on a California based policy. For medical costs, the fixed dollar amount of stop-loss coverage is from $0.25 million to $0.75 million for total costs per covered participant per calendar year. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 25, 2016 | |
Segment Reporting [Abstract] | |
Segment information | Segment Information We have two operating and reporting segments: DynAviation and DynLogistics. The DynAviation and DynLogistics segments operate principally within a regulatory environment subject to governmental contracting and accounting requirements, including Federal Acquisition Regulations, Cost Accounting Standards and audits by various U.S. federal agencies. The following is a summary of the financial information of the reportable segments reconciled to the amounts reported in the condensed consolidated financial statements: Three Months Ended (Amounts in thousands) March 25, 2016 March 27, 2015 Revenue DynAviation $ 288,510 $ 309,905 DynLogistics 131,189 156,400 Headquarters / Other (1) 291 717 Total revenue $ 419,990 $ 467,022 Operating income (loss) DynAviation $ 10,699 $ 4,598 DynLogistics 9,956 7,709 Headquarters / Other (2) (15,177 ) (7,857 ) Total operating income (loss) $ 5,478 $ 4,450 Depreciation and amortization DynAviation $ 163 $ 158 DynLogistics 62 820 Headquarters / Other 8,291 6,820 Total depreciation and amortization (3) $ 8,516 $ 7,798 (1) Headquarters revenue primarily represents revenue earned on shared services arrangements for general and administrative services provided to unconsolidated joint ventures and elimination of intercompany items between segments. (2) Headquarters operating expenses primarily relates to amortization of intangible assets and other costs that are not allocated to segments and are not billable to our U.S. government customers, partially offset by equity method investee income. (3) Includes amounts in Cost of services of $0.2 million and $0.5 million for the three months ended March 25, 2016 and March 27, 2015 , respectively. The following is a summary of the assets of the reportable segments reconciled to the amounts reported in the consolidated financial statements: As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Assets DynAviation $ 335,201 $ 351,627 DynLogistics 180,427 173,036 Headquarters / Other (1) 207,924 260,026 Total assets $ 723,552 $ 784,689 (1) Assets primarily include cash, investments in unconsolidated subsidiaries, and intangible assets (excluding goodwill). |
Related Parties, Joint Ventures
Related Parties, Joint Ventures and Variable Interest Entities | 3 Months Ended |
Mar. 25, 2016 | |
Related Party Transactions [Abstract] | |
Related Parties, Joint Ventures and Variable Interest Entities | Related Parties, Joint Ventures and Variable Interest Entities Consulting Fee We have a Master Consulting and Advisory Services agreement ("COAC Agreement") with Cerberus Operations and Advisory Company, LLC, where, pursuant to the terms of the agreement, they make personnel available to us for the purpose of providing reasonably requested business advisory services. The services are priced on a case by case basis depending on the requirements of the project and agreements in pricing. We incurred $1.8 million and $1.7 million of consulting fees on a gross basis before considering the effect of our contract mix which provides for partial recovery in conjunction with the COAC agreement during the three months ended March 25, 2016 and March 27, 2015 , respectively. We have two executives who are Cerberus Operations and Advisory Company, LLC (“COAC”) employees, who are seconded to us: (i) our Senior Vice President, Chief Administrative Officer, Chief Legal Officer and Corporate Secretary; and (ii) our Senior Vice President, DynGlobal. Inclusive of the $1.8 million and $1.7 million recognized during the three months ended March 25, 2016 and March 27, 2015 in COAC consulting fees, respectively, we recognized $0.6 million and $0.9 million of administrative expense in conjunction with these COAC employees for the three months ended March 25, 2016 and March 27, 2015 , respectively. Certain members of executive management and board members of the Company and seconded COAC individuals may have agreements and conduct business with Cerberus and its affiliates for which they receive compensation. We recognize such compensation as an expense in the consolidated financial statements. Joint Ventures and Variable Interest Entities We account for our investments in VIEs in accordance with ASC 810 - Consolidation . In cases where we have (i) the power to direct the activities of the VIE that most significantly impact its economic performance and (ii) the obligation to absorb losses of the VIE that could potentially be significant or the right to receive benefits from the entity that could potentially be significant to the VIE, we consolidate the entity. Alternatively, in cases where all of the aforementioned criteria are not met, the investment is accounted for under the equity method. As of March 25, 2016 , we accounted for PaTH, CRS, Babcock, GRS and GLS as equity method investments. Alternatively, we consolidated DIFZ based on the aforementioned criteria. We present our share of the PaTH, CRS, GRS and GLS earnings in Earnings from equity method investees as these joint ventures are considered operationally integral. Alternatively, we present our share of the Babcock earnings in Other income, net as it is not considered operationally integral. Receivables due from our unconsolidated joint ventures totaled $0.4 million and $0.5 million as of March 25, 2016 and December 31, 2015 , respectively. These receivables are a result of items purchased and services rendered by us on behalf of our unconsolidated joint ventures. We have assessed these receivables as having minimal collection risk based on our historic experience with these joint ventures and our inherent influence through our ownership interest. The related revenue we earned from our unconsolidated joint ventures totaled $0.0 million and $0.1 million during the three months ended March 25, 2016 and March 27, 2015 , respectively. The related cost of services was $0.2 million and $0.2 million during the three months ended March 25, 2016 and March 27, 2015 , respectively. Additionally, we earned $0.4 million and $0.5 million in equity method income (includes operationally integral and non-integral income) during the three months ended March 25, 2016 and March 27, 2015 , respectively. GLS’ revenue was $9.9 million and $6.7 million during the three months ended March 25, 2016 and March 27, 2015 , respectively. GLS’ operating and net loss was $0.8 million and $0.6 million during the three months ended March 25, 2016 and March 27, 2015 , respectively. We currently hold one promissory note included in Other assets on our consolidated balance sheet from Palm Trading Investment Corp, which had an aggregate initial value of $9.2 million . The loan balance outstanding was $2.4 million and $2.5 million as of March 25, 2016 and December 31, 2015 , respectively, reflecting the initial value plus accrued interest, less payments against the promissory note. The fair value of the note receivable is not materially different from its carrying value. As discussed above and in accordance with ASC 810 - Consolidation , we consolidate DIFZ. The following tables present selected financial information for DIFZ as of March 25, 2016 and December 31, 2015 and for the three months ended March 25, 2016 and March 27, 2015 : As Of (Amounts in millions) March 25, 2016 December 31, 2015 Assets $ 5.0 $ 4.7 Liabilities 2.0 1.1 Three Months Ended (Amounts in millions) March 25, 2016 March 27, 2015 Revenue $ 39.8 $ 51.7 The following tables present selected financial information for our equity method investees as of March 25, 2016 and December 31, 2015 and for the three months ended March 25, 2016 and March 27, 2015 : As Of (Amounts in millions) March 25, 2016 December 31, 2015 Current assets $ 36.8 $ 32.2 Total assets 37.4 32.2 Current liabilities 18.4 12.5 Total liabilities 18.4 12.5 Three Months Ended (Amounts in millions) March 25, 2016 March 27, 2015 Revenue $ 14.7 $ 45.8 Gross profit 0.3 5.1 Net income 0.4 4.0 Many of our joint ventures and VIEs only perform on a single contract. The modification or termination of a contract under a joint venture or VIE could trigger an impairment in the fair value of our investment in these entities. In the aggregate, our maximum exposure to losses as a result of our investment consists of our (i) $8.3 million investment in unconsolidated joint ventures, (ii) $0.4 million in receivables from our unconsolidated joint ventures, (iii) $2.4 million note receivable from Palm Trading Investment Corp. and (iv) contingent liabilities that were neither probable nor reasonably estimable as of March 25, 2016 . |
Consolidating Financial Stateme
Consolidating Financial Statements of Subsidiary Guarantors | 3 Months Ended |
Mar. 25, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidating Financial Statements of Subsidiary Guarantors | Consolidating Financial Statements of Subsidiary Guarantors The Senior Unsecured Notes issued by DynCorp International Inc. ("Subsidiary Issuer") and the Senior Credit Facility are fully and unconditionally guaranteed, jointly and severally, by the Company ("Parent") and all of the domestic subsidiaries of Subsidiary Issuer: DynCorp International LLC, DTS Aviation Services LLC, DynCorp Aerospace Operations LLC, DynCorp International Services LLC, DIV Capital Corporation, Dyn Marine Services of Virginia LLC, Services International LLC, Worldwide Management and Consulting Services LLC, Worldwide Recruiting and Staffing Services LLC, Heliworks LLC, Phoenix Consulting Group LLC and Casals & Associates Inc. ("Subsidiary Guarantors"). Each of the Subsidiary Issuer and the Subsidiary Guarantors is 100% owned by the Company. Under the indenture governing the Senior Unsecured Notes, a guarantee of a Subsidiary Guarantor will terminate upon the following customary circumstances: (i) the sale of the capital stock of such Subsidiary Guarantor if such sale complies with the indenture; (ii) the designation of such Subsidiary Guarantor as an unrestricted subsidiary; (iii) if such Subsidiary Guarantor no longer guarantees certain other indebtedness of the Subsidiary Issuer or (iv) the defeasance or discharge of the indenture. The following condensed consolidating financial statements present (i) unaudited condensed consolidating balance sheets as of March 25, 2016 and December 31, 2015 , (ii) unaudited condensed consolidating statements of operations and comprehensive loss for the three months ended March 25, 2016 and March 27, 2015 , (iii) unaudited condensed consolidating statements of cash flows for the three months ended March 25, 2016 and March 27, 2015 and (iii) elimination entries necessary to consolidate Parent and its subsidiaries. The Parent company, the Subsidiary Issuer, the combined Subsidiary Guarantors and the combined subsidiary non-guarantors account for their investments in subsidiaries using the equity method of accounting; therefore, the Parent column reflects the equity income of the subsidiary and its subsidiary guarantors, and subsidiary non-guarantors. Additionally, the Subsidiary Guarantors’ column reflects the equity income of its subsidiary non-guarantors. DynCorp International Inc. is considered the Subsidiary Issuer as it issued the Senior Unsecured Notes. Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Operations Information For the Three Months Ended March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Revenue $ — $ — $ 423,427 $ 44,818 $ (48,255 ) $ 419,990 Cost of services — — (375,778 ) (44,959 ) 48,239 (372,498 ) Selling, general and administrative expenses — — (34,082 ) (22 ) 14 (34,090 ) Depreciation and amortization expense — — (8,124 ) (169 ) 2 (8,291 ) Earnings from equity method investees — — 367 — — 367 Operating income (loss) — — 5,810 (332 ) — 5,478 Interest expense — (15,278 ) (690 ) — — (15,968 ) Interest income — — 59 1 — 60 Equity in loss of consolidated subsidiaries (14,759 ) (4,828 ) (547 ) — 20,134 — Other income (expense), net — — 359 (7 ) — 352 (Loss) income before income taxes (14,759 ) (20,106 ) 4,991 (338 ) 20,134 (10,078 ) Benefit (provision) for income taxes — 5,347 (9,819 ) (22 ) — (4,494 ) Net loss (14,759 ) (14,759 ) (4,828 ) (360 ) 20,134 (14,572 ) Noncontrolling interests — — — (187 ) — (187 ) Net loss attributable to Delta Tucker Holdings, Inc. $ (14,759 ) $ (14,759 ) $ (4,828 ) $ (547 ) $ 20,134 $ (14,759 ) Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Operations Information For the Three Months Ended March 27, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Revenue $ — $ — $ 471,525 $ 57,266 $ (61,769 ) $ 467,022 Cost of services — — (429,391 ) (56,520 ) 61,753 (424,158 ) Selling, general and administrative expenses — — (31,231 ) (8 ) 16 (31,223 ) Depreciation and amortization expense — — (6,683 ) (576 ) — (7,259 ) Earnings from equity method investees — — 68 — — 68 Operating income — — 4,288 162 — 4,450 Interest expense — (15,574 ) (481 ) — — (16,055 ) Interest income — — 16 1 — 17 Equity in loss of consolidated subsidiaries (14,834 ) (4,711 ) (502 ) — 20,047 — Other income, net — — 912 82 — 994 (Loss) income before income taxes (14,834 ) (20,285 ) 4,233 245 20,047 (10,594 ) Benefit (provision) for income taxes — 5,451 (8,943 ) (317 ) — (3,809 ) Net loss (14,834 ) (14,834 ) (4,710 ) (72 ) 20,047 (14,403 ) Noncontrolling interests — — — (431 ) — (431 ) Net loss attributable to Delta Tucker Holdings, Inc. $ (14,834 ) $ (14,834 ) $ (4,710 ) $ (503 ) $ 20,047 $ (14,834 ) Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Comprehensive Loss Information For the Three Months Ended March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net loss $ (14,759 ) $ (14,759 ) $ (4,828 ) $ (360 ) $ 20,134 $ (14,572 ) Other comprehensive income: Currency translation adjustment 3 3 — 3 (6 ) 3 Other comprehensive income, before tax 3 3 — 3 (6 ) 3 Income tax expense related to items of other comprehensive income (1 ) (1 ) — (1 ) 2 (1 ) Other comprehensive income 2 2 — 2 (4 ) 2 Comprehensive loss (14,757 ) (14,757 ) (4,828 ) (358 ) 20,130 (14,570 ) Noncontrolling interests — — — (187 ) — (187 ) Comprehensive loss attributable to Delta Tucker Holdings, Inc. $ (14,757 ) $ (14,757 ) $ (4,828 ) $ (545 ) $ 20,130 $ (14,757 ) Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Comprehensive (Loss) Income Information For the Three Months Ended March 27, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net loss $ (14,834 ) $ (14,834 ) $ (4,710 ) $ (72 ) $ 20,047 $ (14,403 ) Other comprehensive loss: Currency translation adjustment (113 ) (113 ) — (113 ) 226 (113 ) Other comprehensive loss, before tax (113 ) (113 ) — (113 ) 226 (113 ) Income tax benefit related to items of other comprehensive loss 40 40 — 40 (80 ) 40 Other comprehensive loss (73 ) (73 ) — (73 ) 146 (73 ) Comprehensive loss (14,907 ) (14,907 ) (4,710 ) (145 ) 20,193 (14,476 ) Noncontrolling interests — — — (431 ) — (431 ) Comprehensive loss attributable to Delta Tucker Holdings, Inc. $ (14,907 ) $ (14,907 ) $ (4,710 ) $ (576 ) $ 20,193 $ (14,907 ) Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Balance Sheet Information March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ — $ 57,491 $ 17,296 $ — $ 74,787 Restricted cash — — 721 — — 721 Accounts receivable, net — — 390,613 2,649 (11,630 ) 381,632 Intercompany receivables — — 196,832 4,464 (201,296 ) — Prepaid expenses and other current assets — — 49,139 2,228 (394 ) 50,973 Assets held for sale 6,155 6,155 Total current assets — — 700,951 26,637 (213,320 ) 514,268 Property and equipment, net — — 14,632 1,056 — 15,688 Goodwill — — 9,694 32,399 — 42,093 Tradenames, net — — 28,536 — — 28,536 Other intangibles, net — — 107,089 122 — 107,211 Investment in subsidiaries — 630,287 54,497 — (684,784 ) — Long-term deferred taxes — — — — — — Other assets, net — — 12,820 2,936 — 15,756 Total assets $ — $ 630,287 $ 928,219 $ 63,150 $ (898,104 ) $ 723,552 LIABILITIES & EQUITY Current liabilities: Current portion of long-term debt $ — $ 185,948 $ — $ — $ — $ 185,948 Accounts payable — — 87,054 1,962 (1,541 ) 87,475 Accrued payroll and employee costs — — 94,531 3,041 — 97,572 Intercompany payables 43,883 152,949 4,464 — (201,296 ) — Deferred income taxes — — (25 ) 25 — — Accrued liabilities 183,422 22,206 68,401 3,625 (193,889 ) 83,765 Liabilities held for sale — — 426 — — 426 Income taxes payable — — 10,058 — (16 ) 10,042 Total current liabilities 227,305 361,103 264,909 8,653 (396,742 ) 465,228 Long-term debt — 452,605 — — — 452,605 Long-term deferred taxes 1,196 — 15,299 — — 16,495 Other long-term liabilities — — 12,351 — — 12,351 Noncontrolling interests — — 5,373 — — 5,373 (Deficit) equity (228,501 ) (183,421 ) 630,287 54,497 (501,362 ) (228,500 ) Total liabilities and deficit $ — $ 630,287 $ 928,219 $ 63,150 $ (898,104 ) $ 723,552 Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Balance Sheet Information December 31, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ — $ 95,365 $ 13,417 $ — $ 108,782 Restricted cash — — 721 — — 721 Accounts receivable, net — — 389,773 11 (3,687 ) 386,097 Intercompany receivables — — 199,364 15,180 (214,544 ) — Prepaid expenses and other current assets — — 54,364 1,825 (506 ) 55,683 Assets held for sale — — 7,913 — — 7,913 Total current assets — — 747,500 30,433 (218,737 ) 559,196 Long-term restricted cash — — — — — — Property and equipment, net — — 14,617 1,077 — 15,694 Goodwill — — 9,694 32,399 — 42,093 Tradenames, net — — 28,536 — — 28,536 Other intangibles, net — — 113,256 223 — 113,479 Investment in subsidiaries — 650,005 55,460 — (705,465 ) — Long-term deferred taxes — — 13,364 — — 13,364 Other assets, net — — 10,616 1,711 — 12,327 Total assets $ — $ 650,005 $ 993,043 $ 65,843 $ (924,202 ) $ 784,689 LIABILITIES & EQUITY Current liabilities: Current portion of long-term debt $ — $ 184,866 $ — $ — $ — $ 184,866 Accounts payable — — 85,374 6,138 (902 ) 90,610 Accrued payroll and employee costs — — 96,800 3,881 — 100,681 Intercompany payables 45,079 154,285 15,180 — (214,544 ) — Deferred income taxes — — 27,310 24 — 27,334 Accrued liabilities 168,883 27,572 90,013 340 (172,090 ) 114,718 Liabilities held for sale — — 784 — — 784 Income taxes payable — — 8,214 — (84 ) 8,130 Total current liabilities 213,962 366,723 323,675 10,383 (387,620 ) 527,123 Long-term debt — 452,165 — — — 452,165 Other long-term liabilities — — 13,571 — — 13,571 Noncontrolling interests — — 5,792 — — 5,792 (Deficit) Equity (213,962 ) (168,883 ) 650,005 55,460 (536,582 ) (213,962 ) Total liabilities and deficit $ — $ 650,005 $ 993,043 $ 65,843 $ (924,202 ) $ 784,689 Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Cash Flow Information For the Three Months Ended March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net cash provided by (used in) operating activities $ 1,759 $ 35,267 $ (48,110 ) $ (19,056 ) $ (403 ) $ (30,543 ) Cash flows from investing activities: Purchase of property and equipment, net — — (788 ) (24 ) — (812 ) Purchase of software — — (1,261 ) — — (1,261 ) Contributions to equity method investees — — (1,225 ) — — (1,225 ) Transfers from (to) affiliates — — 37,277 23,767 (61,044 ) — Net cash provided by (used in) investing activities — — 34,003 23,743 (61,044 ) (3,298 ) Cash flows from financing activities: Equity contributions from affiliates to Cerberus — 250 — — — 250 Payments of dividends to Parent — — — (808 ) 404 (404 ) Transfers (to) from affiliates (1,759 ) (35,517 ) (23,767 ) — 61,043 — Net cash used in financing activities (1,759 ) (35,267 ) (23,767 ) (808 ) 61,447 (154 ) Net (decrease) increase in cash and cash equivalents — — (37,874 ) 3,879 — (33,995 ) Cash and cash equivalents, beginning of period — — 95,365 13,417 — 108,782 Cash and cash equivalents, end of period $ — $ — $ 57,491 $ 17,296 $ — $ 74,787 Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Cash Flow Information For The Three Months Ended March 27, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net cash provided by (used in) operating activities $ 1,571 $ (2,592 ) $ (20,968 ) $ (11,473 ) $ (101 ) $ (33,563 ) Cash flows from investing activities: Purchase of property and equipment, net — — (173 ) — — (173 ) Purchase of software — — (417 ) — — (417 ) Return of capital from equity method investees — — 1,822 — — 1,822 Contributions to equity method investees — — (500 ) — — (500 ) Transfers (to) from affiliates — — (1,021 ) 16,662 (15,641 ) — Net cash used in (provided by) investing activities — — (289 ) 16,662 (15,641 ) 732 Cash flows from financing activities: Borrowings on indebtedness — 34,900 — — — 34,900 Payments on indebtedness — (34,900 ) — — — (34,900 ) Payments under other financing arrangements — — (1,023 ) — — (1,023 ) Payments of dividends to Parent — — — (404 ) 101 (303 ) Transfers (to) from affiliates (1,571 ) 2,592 (16,662 ) — 15,641 — Net cash (used in) provided by financing activities (1,571 ) 2,592 (17,685 ) (404 ) 15,742 (1,326 ) Net (decrease) increase in cash and cash equivalents — — (38,942 ) 4,785 — (34,157 ) Cash and cash equivalents, beginning of period — — 87,300 6,704 — 94,004 Cash and cash equivalents, end of period $ — $ — $ 48,358 $ 11,489 $ — $ 59,847 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 25, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events We evaluated potential subsequent events occurring after the period end date through the date the financial statements were issued and concluded that there were no material subsequent events for the quarter ended March 25, 2016 , except as disclosed below and within the Notes to the unaudited condensed consolidated financial statements. INL Air Wing As previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, filed with the SEC on March 30, 2016 (the “2015 Annual Report”), the Company has been engaged in a recompete process related to the INL Air Wing contract. As stated in the 2015 Annual Report, in October 2015, the Company received notification of a new competitive range decision that reinstated the Company’s proposal back into the competitive range for the recompete regarding services after October 2016. Most recently, the DoS notified the Company that they have closed discussions and have requested the Company’ final proposal by May 4, 2016, which the Company submitted on May 4, 2016. If the Company does not win the recompete on the INL Air Wing contract, it would adversely affect the Company’s operating results, financial performance and cash flows. In addition, if the failure to win the recompete for the INL Air Wing contract results in a “Material Adverse Effect” as defined in Amendment No. 5, then the lenders under the New Senior Credit Facility may not be required to fund their commitments under the Extended Revolving Credit Facility, or if such event occurs prior to the closing of the Exchange Offer, to fund the New Term Loan Facility. Commencement of Exchange Offer and Consent Solicitation On May 2, 2016, the Company issued a press release announcing the commencement of the Exchange Offer and Consent Solicitation with respect to the outstanding Senior Unsecured Notes as described in Note 1. |
Basis of Presentation and Acc20
Basis of Presentation and Accounting Policies (Policies) | 3 Months Ended |
Mar. 25, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation Delta Tucker Holdings, Inc. ("Holdings"), the parent of DynCorp International Inc., through its subsidiaries (together, "the Company"), provides defense and technical services and government outsourced solutions primarily to U.S. government agencies domestically and internationally. The Company was incorporated in the state of Delaware on April 1, 2010. Our customers include the U.S. Department of Defense ("DoD"), the U.S. Department of State ("DoS"), the U.S. Agency for International Development ("USAID"), foreign governments, commercial customers and certain other U.S. federal, state and local government departments and agencies. Unless the context otherwise indicates, references herein to "we," "our," "us," or "the Company" refer to Delta Tucker Holdings, Inc. and our consolidated subsidiaries. The unaudited condensed consolidated financial statements include the accounts of the Company and our domestic and foreign subsidiaries. These unaudited condensed consolidated financial statements have been prepared pursuant to accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that all disclosures are adequate and do not make the information presented misleading. These unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 . In the opinion of management, normal recurring adjustments necessary to fairly present our financial position as of March 25, 2016 and December 31, 2015 , the results of operations and statements of comprehensive loss for the three months ended March 25, 2016 and March 27, 2015 and the statements of deficit and cash flows for the three months ended March 25, 2016 and March 27, 2015 have been included. The results of operations and statements of comprehensive loss for the three months ended March 25, 2016 and March 27, 2015 and the statements of deficit and cash flows for the three months ended March 25, 2016 and March 27, 2015 are not necessarily indicative of the results to be expected for the full calendar year or for any future periods. We use estimates and assumptions required for preparation of the financial statements. The estimates are primarily based on historical experience and business knowledge and are revised as circumstances change. Our actual results may differ from these estimates. |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of both our domestic and foreign subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The Company has investments in joint ventures that are variable interest entities ("VIEs"). The VIE investments are accounted for in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 810 — Consolidation . In cases where the Company has (i) the power to direct the activities of the VIE that most significantly impact its economic performance and (ii) the obligation to absorb losses of the VIE that could potentially be significant or the right to receive benefits from the entity that could potentially be significant to the VIE, the Company consolidates the entity. Alternatively, in cases where all of the aforementioned criteria are not met, the investment is accounted for under the equity method. The Company classifies its equity method investees in two distinct groups based on management’s day-to-day involvement in the operations of each entity and the nature of each joint venture’s business. If the joint venture is deemed to be an extension of one of our segments and operationally integral to the business, our share of the joint venture’s earnings is reported within operating loss in Earnings from equity method investees in the consolidated statement of operations. If the Company considers our involvement less significant, the share of the joint venture’s net earnings is reported in Other income, net in the consolidated statement of operations. Noncontrolling Interests We record the impact of our partners' interests in less than wholly owned consolidated joint ventures as noncontrolling interests. Currently, DynCorp International FZ-LLC ("DIFZ") is our only consolidated joint venture for which we do not own 100% of the entity. We hold 25% ownership interest in DIFZ. We continue to consolidate DIFZ as we still exercise power over activities that significantly impact DIFZ’s economic performance and have the obligation to absorb losses or receive benefits of DIFZ that could potentially be significant to DIFZ. Noncontrolling interests is presented on the face of the statements of operations as an increase or reduction in arriving at "Net loss attributable to Delta Tucker Holdings, Inc." Noncontrolling interests is located in the equity section on the consolidated balance sheets. See Note 10 for further discussion regarding DIFZ. |
Use of Estimates | Use of Estimates The preparation of the financial statements requires us to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. Our estimates and assumptions are reviewed periodically, and the effects of changes, if any, are reflected in the consolidated statements of operations in the period that they are determined. Changes in contract estimates related to certain types of contracts accounted for using the percentage of completion method of accounting are recognized in the period in which such changes are made for the inception-to-date effect of the changes. Changes in these estimates can occur over the life of a contract for a variety of reasons, including changes in scope, estimated incentive or award fees, cost estimates, level of effort and/or other assumptions impacting revenue or cost to perform a contract. The gross favorable and unfavorable adjustments below reflect these changes in contract estimates during each reporting period, excluding new or completed contracts where no comparative estimates exist between reporting periods. |
Accounting Policies | Accounting Policies In January 2015, the FASB issued Accounting Standards Update ("ASU") No. 2015-01, Income Statement-Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. ASU 2015-01 eliminates from GAAP the concept of extraordinary items. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015, and may be applied either prospectively or retrospectively to all prior periods presented in the financial statements. We prospectively adopted ASU No. 2015-01 during the quarter ended March 25, 2016 . The adoption of this guidance did not have a material impact on our consolidated financial statements. In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. ASU 2015-02 changes the consolidation guidance to address concerns of stakeholders that current accounting for certain legal entities might require a reporting entity to consolidate another legal entity in situations in which the reporting entity’s contractual rights do not give it the ability to act primarily on its own behalf, the reporting entity does not hold a majority of the legal entity’s voting rights, or the reporting entity is not exposed to a majority of the legal entity’s economic benefits or obligations. ASU 2015-02 will be effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. We adopted ASU No. 2015-02 during the quarter ended March 25, 2016 . The adoption of this guidance did not have a material impact on our consolidated financial position, results of operations or cash flows. In April 2015, the FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs. ASU 2015-03 requires that deferred financing costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability instead of being presented as an asset, consistent with debt discounts. Debt disclosures will include the face amount of the debt liability and the effective interest rate. The update is effective for fiscal years beginning after December 15, 2015, and required retrospective application. We adopted ASU 2015-03 during the quarter ended March 25, 2016 and applied its provisions retrospectively. The adoption of ASU 2015-03 resulted in the reclassification of current deferred financing costs, net, of $2.4 million related to our Term Loan and Revolver from prepaid expenses and other current assets to the current portion of long-term debt and the reclassification of deferred financing costs, net, of $2.8 million related to our Senior Unsecured Notes from total other assets, net, to long-term debt within our Condensed Consolidated Balance Sheets as of December 31, 2015 . Adoption of this standard did not impact the results of operations, retained earnings, or cash flows in the current or previous interim and annual reporting periods. In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , which eliminates the current requirement to present deferred tax liabilities and assets as current and noncurrent amounts in a classified statement of financial position. Instead, entities will be required to classify all deferred tax assets and liabilities as noncurrent in a statement of financial position. This standard is effective for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. We adopted ASU No. 2015-17 during the quarter ended March 25, 2016 and applied it prospectively to the period ended March 25, 2016 . Prior periods were not retroactively adjusted. Adoption of this standard did not impact the results of operations, retained earnings, or cash flows in the current or previous interim and annual reporting periods. Excluding the adoption of the accounting standards updates discussed above, there have been no material changes to our significant accounting policies from those described in our Annual Report on Form 10-K for the year ended December 31, 2015 . |
Accounting Developments | Accounting Developments In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) , which outlines a single set of comprehensive principles for recognizing revenue under GAAP. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) . ASU 2016-08 clarifies the implementation guidance on principal versus agent considerations. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing . ASU 2016-10 clarifies the implementation guidance on identifying performance obligations. These ASUs apply to all entities that enter into contracts with customers to transfer goods or services. These ASUs are effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted, but not before interim and annual reporting periods beginning after December 15, 2016. Entities have the choice to apply these ASUs either retrospectively to each reporting period presented or by recognizing the cumulative effect of applying these standards at the date of initial application and not adjusting comparative information. We are currently evaluating both methods of adoption as well as the effect of these standards will have on our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. ASU 2015-11 requires an entity who measures inventory using FIFO or average cost to measure inventory at the lower of cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs. The update is effective for fiscal years beginning after December 15, 2016 and interim periods within fiscal years beginning after December 15, 2016 and applied prospectively. Early adoption is permitted, including adoption in an interim period. We are currently evaluating the potential effects of the adoption of ASU 2015-11 on our consolidated financial position. In February 2016, the FASB issued ASU No. 2016-02, Leases . The guidance in ASU 2016-02 supersedes the lease recognition requirements in ASC Topic 840, Leases . ASU 2016-02 requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases, along with additional qualitative and quantitative disclosures. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the potential effects of the adoption of ASU 2016-02 on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-06, Derivatives and Hedging: Contingent Put and Call Options in Debt Instruments. ASU 2016-06 clarifies how to assess whether an embedded contingent put or call option is clearly and closely related to a debt host. The amendments are effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016. The amendments are effective for annual reporting periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. Early adoption is permitted. We are currently evaluating the potential effects of the adoption of ASU 2016-06 on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, Investments - Equity Method and Joint Ventures: Simplifying the Transition to the Equity Method of Accounting. ASU 2016-07 simplifies the equity method by eliminating the requirement to apply it retrospectively to an investment that subsequently qualifies for such accounting as a result of an increase in the level of ownership interest or degree of influence. The amendments are effective for annual reporting periods, and interim periods therein, beginning after December 15, 2016. Early adoption is permitted. We are currently evaluating the potential effects of the adoption of ASU 2016-07 on our consolidated financial statements. Other accounting standards updates effective after March 25, 2016 are not expected to have a material effect on our consolidated financial position or results of operations and cash flows for the period ended March 25, 2016 . |
Basis of Presentation and Acc21
Basis of Presentation and Accounting Policies (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Accounting Policies [Abstract] | |
Aggregate gross favorable and unfavorable adjustments to income before income taxes | The following table presents the aggregate gross favorable and unfavorable adjustments to income before taxes resulting from changes in contract estimates for the three months ended March 25, 2016 and March 27, 2015 . Three Months Ended (Amounts in millions) March 25, 2016 March 27, 2015 Gross favorable adjustments $ 6.7 $ 3.2 Gross unfavorable adjustments (2.0 ) (5.8 ) Net adjustments $ 4.7 $ (2.6 ) |
Composition of Certain Financ22
Composition of Certain Financial Statement Captions (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Prepaid expenses and other current assets | Prepaid expenses and other current assets As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Prepaid expenses $ 31,583 $ 30,985 Income tax refunds receivable 63 204 Inventories 13,636 14,776 Work-in-process inventory 1,733 1,733 Joint venture receivables 351 460 Other current assets 3,607 7,525 Total prepaid expenses and other current assets $ 50,973 $ 55,683 |
Property, plant and equipment | Property and equipment, net As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Helicopters $ 983 $ 983 Computers and other equipment 10,814 10,392 Leasehold improvements 20,169 19,639 Office furniture and fixtures 4,551 4,541 Gross property and equipment 36,517 35,555 Less accumulated depreciation (20,829 ) (19,861 ) Total property and equipment, net $ 15,688 $ 15,694 |
Other assets, net | Other assets, net As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Investment in affiliates 8,304 6,712 Palm promissory note, long-term portion 1,708 2,079 Other 5,744 3,536 Total other assets, net $ 15,756 $ 12,327 |
Accrued payroll and employee costs | Accrued payroll and employee costs As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Wages, compensation and other benefits $ 79,400 $ 85,216 Accrued vacation 16,943 14,433 Accrued contributions to employee benefit plans 1,229 1,032 Total accrued payroll and employee costs $ 97,572 $ 100,681 |
Accrued liabilities | Accrued liabilities As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Customer liabilities $ 15,702 $ 21,183 Accrued insurance 27,472 35,530 Accrued interest 11,864 24,370 Contract losses 9,941 15,718 Legal reserves 4,638 5,063 Subcontractor retention 1,363 1,646 Other 12,785 11,208 Total accrued liabilities $ 83,765 $ 114,718 |
Goodwill and Other Intangible23
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill balances for segments | The carrying amounts of goodwill for each of our segments as of March 25, 2016 were as follows: (Amounts in thousands) DynAviation DynLogistics Total Goodwill balance as of December 31, 2015 $ — $ 42,093 $ 42,093 Changes between January 1, 2016 and March 25, 2016 — — — Goodwill balance as of March 25, 2016 $ — $ 42,093 $ 42,093 |
Information about changes relating to certain intangible assets | The following tables provide information about changes relating to certain intangible assets: As of March 25, 2016 (Amounts in thousands, except years) Weighted Average Remaining Useful Life (Years) Gross Carrying Value Accumulated Amortization Impairment Transfer to Assets Held for Sale Net Other intangible assets: Customer-related intangible assets 3.7 $ 252,615 $ (149,119 ) $ — $ — $ 103,496 Other Finite-lived 0.9 14,580 (10,834 ) — (31 ) 3,715 Indefinite-lived — — — — — Total other intangibles $ 267,195 $ (159,953 ) $ — $ (31 ) $ 107,211 Tradenames: Finite-lived 0.0 $ 869 $ (869 ) $ — $ — $ — Indefinite-lived 28,536 — — — 28,536 Total tradenames $ 29,405 $ (869 ) $ — $ — $ 28,536 December 31, 2015 (Amounts in thousands, except years) Weighted Gross Accumulated Impairment Transfer to Assets Held for Sale Net Other intangible assets: Customer-related intangible assets 4.0 $ 252,615 $ (142,020 ) $ — $ — $ 110,595 Other Finite-lived 0.7 13,325 (10,430 ) — (11 ) 2,884 Indefinite-lived 5,059 — (5,059 ) — — Total other intangibles $ 270,999 $ (152,450 ) $ (5,059 ) $ (11 ) $ 113,479 Tradenames: Finite-lived 0.0 $ 869 $ (869 ) $ — $ — $ — Indefinite-lived 28,700 — (164 ) — 28,536 Total tradenames $ 29,569 $ (869 ) $ (164 ) $ — $ 28,536 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Income Tax Disclosure [Abstract] | |
Domestic and foreign components of Income (loss) before income taxes | The domestic and foreign components of Loss before income taxes are as follows: Three Months Ended (Amounts in thousands) March 25, 2016 March 27, 2015 Domestic $ (10,592 ) $ (11,325 ) Foreign 514 731 Loss before income taxes $ (10,078 ) $ (10,594 ) |
Deferred tax liabilities, net | Deferred tax liabilities, net consist of the following: As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Current deferred tax liabilities, net $ — $ (27,334 ) Non-current deferred tax (liabilities) assets, net (16,495 ) 13,364 Deferred tax liabilities, net $ (16,495 ) $ (13,970 ) |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Receivables [Abstract] | |
Accounts receivable | Accounts receivable, net consisted of the following: As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Billed $ 162,367 $ 136,127 Unbilled 219,265 249,970 Total accounts receivable, net $ 381,632 $ 386,097 |
Fair Value of Financial Asset26
Fair Value of Financial Assets and Liabilities (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Fair Value Disclosures [Abstract] | |
Estimate of fair value of long-term debt based on quoted prices in active markets | Our estimate of the fair value of our debt is based on Level 1 and Level 2 inputs, as defined above. As Of March 25, 2016 December 31, 2015 (Amounts in thousands) Carrying Amount Fair Value Carrying Amount Fair Value 10.375% senior unsecured notes $ 455,000 $ 360,019 $ 455,000 $ 337,838 Term Loan 187,272 180,249 187,272 179,781 Total indebtedness 642,272 540,268 642,272 517,619 Less current portion of long-term debt (187,272 ) (180,249 ) (187,272 ) (179,781 ) Total long-term debt $ 455,000 $ 360,019 $ 455,000 $ 337,838 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Debt consisted of the following: As of March 25, 2016 (Amounts in thousands) Carrying Amount Deferred Financing Costs, Net Carrying Amount less Deferred Financing Costs, Net 10.375% senior unsecured notes $ 455,000 $ (2,395 ) $ 452,605 Term loan 187,272 (1,324 ) 185,948 Total indebtedness 642,272 (3,719 ) 638,553 Less current portion of long-term debt (187,272 ) 1,324 (185,948 ) Total long-term debt $ 455,000 $ (2,395 ) $ 452,605 As of December 31, 2015 (Amounts in thousands) Carrying Amount Deferred Financing Costs, Net Carrying Amount less Deferred Financing Costs, Net 10.375% senior unsecured notes $ 455,000 $ (2,835 ) $ 452,165 Term loan 187,272 (2,406 ) 184,866 Total indebtedness 642,272 (5,241 ) 637,031 Less current portion of long-term debt (187,272 ) 2,406 (184,866 ) Total long-term debt $ 455,000 $ (2,835 ) $ 452,165 |
Schedule of maximum leverage ratios by period end | The maximum total leverage ratios under the New Senior Credit Facility are set forth below as follows: Period Ending Total Leverage Ratio March 25, 2016 7.60 to 1.0 June 24, 2016 7.40 to 1.0 September 30, 2016 7.50 to 1.0 December 31, 2016 7.40 to 1.0 March 31, 2017 7.30 to 1.0 June 30, 2017 6.75 to 1.0 September 29, 2017 6.50 to 1.0 December 31, 2017 5.75 to 1.0 March 30, 2018 5.75 to 1.0 June 29, 2018 5.50 to 1.0 September 28, 2018 5.40 to 1.0 September 29, 2018 and thereafter 4.75 to 1.0 The maximum total leverage ratios under the Senior Credit Facility are set forth below as follows: Period Ending Total Leverage Ratio March 25, 2016 7.60 to 1.0 June 24, 2016 6.90 to 1.0 June 25, 2016 and thereafter 6.60 to 1.0 |
Schedule of interest coverage ratios by period end | The minimum interest coverage ratios under the New Senior Credit Facility are set forth below as follows: Period Ending Interest Coverage Ratio March 25, 2016 1.15 to 1.0 June 24, 2016 1.15 to 1.0 September 30, 2016 1.15 to 1.0 December 31, 2016 1.15 to 1.0 March 31, 2017 1.20 to 1.0 June 30, 2017 1.20 to 1.0 September 29, 2017 1.30 to 1.0 December 31, 2017 1.40 to 1.0 March 30, 2018 1.50 to 1.0 June 29, 2018 1.60 to 1.0 June 30, 2018 and thereafter 1.70 to 1.0 The minimum interest coverage ratios under the Senior Credit Facility are set forth below as follows: Period Ending Interest Coverage Ratio March 25, 2016 1.15 to 1.0 June 24, 2016 1.20 to 1.0 June 25, 2016 and thereafter 1.30 to 1.0 |
Schedule of debt redemption prices | The applicable redemption prices with respect to the Senior Unsecured Notes on any applicable redemption date if redeemed during the 12-month period commencing on July 1 of the years set forth below are as follows: Year Redemption Price 2015 102.6 % 2016 and thereafter 100.0 % |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Segment Reporting [Abstract] | |
Summary of the financial information of the reportable segments reconciled | The following is a summary of the financial information of the reportable segments reconciled to the amounts reported in the condensed consolidated financial statements: Three Months Ended (Amounts in thousands) March 25, 2016 March 27, 2015 Revenue DynAviation $ 288,510 $ 309,905 DynLogistics 131,189 156,400 Headquarters / Other (1) 291 717 Total revenue $ 419,990 $ 467,022 Operating income (loss) DynAviation $ 10,699 $ 4,598 DynLogistics 9,956 7,709 Headquarters / Other (2) (15,177 ) (7,857 ) Total operating income (loss) $ 5,478 $ 4,450 Depreciation and amortization DynAviation $ 163 $ 158 DynLogistics 62 820 Headquarters / Other 8,291 6,820 Total depreciation and amortization (3) $ 8,516 $ 7,798 (1) Headquarters revenue primarily represents revenue earned on shared services arrangements for general and administrative services provided to unconsolidated joint ventures and elimination of intercompany items between segments. (2) Headquarters operating expenses primarily relates to amortization of intangible assets and other costs that are not allocated to segments and are not billable to our U.S. government customers, partially offset by equity method investee income. (3) Includes amounts in Cost of services of $0.2 million and $0.5 million for the three months ended March 25, 2016 and March 27, 2015 , respectively |
Schedule of assets allocation to segment | The following is a summary of the assets of the reportable segments reconciled to the amounts reported in the consolidated financial statements: As Of (Amounts in thousands) March 25, 2016 December 31, 2015 Assets DynAviation $ 335,201 $ 351,627 DynLogistics 180,427 173,036 Headquarters / Other (1) 207,924 260,026 Total assets $ 723,552 $ 784,689 (1) Assets primarily include cash, investments in unconsolidated subsidiaries, and intangible assets (excluding goodwill). |
Related Parties, Joint Ventur29
Related Parties, Joint Ventures and Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Related Party Transactions [Abstract] | |
Ownership percentage of Joint Ventures and Variable Interest Entities | The following tables present selected financial information for DIFZ as of March 25, 2016 and December 31, 2015 and for the three months ended March 25, 2016 and March 27, 2015 : As Of (Amounts in millions) March 25, 2016 December 31, 2015 Assets $ 5.0 $ 4.7 Liabilities 2.0 1.1 Three Months Ended (Amounts in millions) March 25, 2016 March 27, 2015 Revenue $ 39.8 $ 51.7 |
Selected financial information for related parties and equity method investees | The following tables present selected financial information for our equity method investees as of March 25, 2016 and December 31, 2015 and for the three months ended March 25, 2016 and March 27, 2015 : As Of (Amounts in millions) March 25, 2016 December 31, 2015 Current assets $ 36.8 $ 32.2 Total assets 37.4 32.2 Current liabilities 18.4 12.5 Total liabilities 18.4 12.5 Three Months Ended (Amounts in millions) March 25, 2016 March 27, 2015 Revenue $ 14.7 $ 45.8 Gross profit 0.3 5.1 Net income 0.4 4.0 |
Consolidating Financial State30
Consolidating Financial Statements of Subsidiary Guarantors (Tables) | 3 Months Ended |
Mar. 25, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Condensed statement of operations | Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Operations Information For the Three Months Ended March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Revenue $ — $ — $ 423,427 $ 44,818 $ (48,255 ) $ 419,990 Cost of services — — (375,778 ) (44,959 ) 48,239 (372,498 ) Selling, general and administrative expenses — — (34,082 ) (22 ) 14 (34,090 ) Depreciation and amortization expense — — (8,124 ) (169 ) 2 (8,291 ) Earnings from equity method investees — — 367 — — 367 Operating income (loss) — — 5,810 (332 ) — 5,478 Interest expense — (15,278 ) (690 ) — — (15,968 ) Interest income — — 59 1 — 60 Equity in loss of consolidated subsidiaries (14,759 ) (4,828 ) (547 ) — 20,134 — Other income (expense), net — — 359 (7 ) — 352 (Loss) income before income taxes (14,759 ) (20,106 ) 4,991 (338 ) 20,134 (10,078 ) Benefit (provision) for income taxes — 5,347 (9,819 ) (22 ) — (4,494 ) Net loss (14,759 ) (14,759 ) (4,828 ) (360 ) 20,134 (14,572 ) Noncontrolling interests — — — (187 ) — (187 ) Net loss attributable to Delta Tucker Holdings, Inc. $ (14,759 ) $ (14,759 ) $ (4,828 ) $ (547 ) $ 20,134 $ (14,759 ) Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Operations Information For the Three Months Ended March 27, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Revenue $ — $ — $ 471,525 $ 57,266 $ (61,769 ) $ 467,022 Cost of services — — (429,391 ) (56,520 ) 61,753 (424,158 ) Selling, general and administrative expenses — — (31,231 ) (8 ) 16 (31,223 ) Depreciation and amortization expense — — (6,683 ) (576 ) — (7,259 ) Earnings from equity method investees — — 68 — — 68 Operating income — — 4,288 162 — 4,450 Interest expense — (15,574 ) (481 ) — — (16,055 ) Interest income — — 16 1 — 17 Equity in loss of consolidated subsidiaries (14,834 ) (4,711 ) (502 ) — 20,047 — Other income, net — — 912 82 — 994 (Loss) income before income taxes (14,834 ) (20,285 ) 4,233 245 20,047 (10,594 ) Benefit (provision) for income taxes — 5,451 (8,943 ) (317 ) — (3,809 ) Net loss (14,834 ) (14,834 ) (4,710 ) (72 ) 20,047 (14,403 ) Noncontrolling interests — — — (431 ) — (431 ) Net loss attributable to Delta Tucker Holdings, Inc. $ (14,834 ) $ (14,834 ) $ (4,710 ) $ (503 ) $ 20,047 $ (14,834 ) |
Condensed statement of comprehensive income | Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Comprehensive Loss Information For the Three Months Ended March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net loss $ (14,759 ) $ (14,759 ) $ (4,828 ) $ (360 ) $ 20,134 $ (14,572 ) Other comprehensive income: Currency translation adjustment 3 3 — 3 (6 ) 3 Other comprehensive income, before tax 3 3 — 3 (6 ) 3 Income tax expense related to items of other comprehensive income (1 ) (1 ) — (1 ) 2 (1 ) Other comprehensive income 2 2 — 2 (4 ) 2 Comprehensive loss (14,757 ) (14,757 ) (4,828 ) (358 ) 20,130 (14,570 ) Noncontrolling interests — — — (187 ) — (187 ) Comprehensive loss attributable to Delta Tucker Holdings, Inc. $ (14,757 ) $ (14,757 ) $ (4,828 ) $ (545 ) $ 20,130 $ (14,757 ) Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Comprehensive (Loss) Income Information For the Three Months Ended March 27, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net loss $ (14,834 ) $ (14,834 ) $ (4,710 ) $ (72 ) $ 20,047 $ (14,403 ) Other comprehensive loss: Currency translation adjustment (113 ) (113 ) — (113 ) 226 (113 ) Other comprehensive loss, before tax (113 ) (113 ) — (113 ) 226 (113 ) Income tax benefit related to items of other comprehensive loss 40 40 — 40 (80 ) 40 Other comprehensive loss (73 ) (73 ) — (73 ) 146 (73 ) Comprehensive loss (14,907 ) (14,907 ) (4,710 ) (145 ) 20,193 (14,476 ) Noncontrolling interests — — — (431 ) — (431 ) Comprehensive loss attributable to Delta Tucker Holdings, Inc. $ (14,907 ) $ (14,907 ) $ (4,710 ) $ (576 ) $ 20,193 $ (14,907 ) |
Condensed consolidating balance sheet information | Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Balance Sheet Information March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ — $ 57,491 $ 17,296 $ — $ 74,787 Restricted cash — — 721 — — 721 Accounts receivable, net — — 390,613 2,649 (11,630 ) 381,632 Intercompany receivables — — 196,832 4,464 (201,296 ) — Prepaid expenses and other current assets — — 49,139 2,228 (394 ) 50,973 Assets held for sale 6,155 6,155 Total current assets — — 700,951 26,637 (213,320 ) 514,268 Property and equipment, net — — 14,632 1,056 — 15,688 Goodwill — — 9,694 32,399 — 42,093 Tradenames, net — — 28,536 — — 28,536 Other intangibles, net — — 107,089 122 — 107,211 Investment in subsidiaries — 630,287 54,497 — (684,784 ) — Long-term deferred taxes — — — — — — Other assets, net — — 12,820 2,936 — 15,756 Total assets $ — $ 630,287 $ 928,219 $ 63,150 $ (898,104 ) $ 723,552 LIABILITIES & EQUITY Current liabilities: Current portion of long-term debt $ — $ 185,948 $ — $ — $ — $ 185,948 Accounts payable — — 87,054 1,962 (1,541 ) 87,475 Accrued payroll and employee costs — — 94,531 3,041 — 97,572 Intercompany payables 43,883 152,949 4,464 — (201,296 ) — Deferred income taxes — — (25 ) 25 — — Accrued liabilities 183,422 22,206 68,401 3,625 (193,889 ) 83,765 Liabilities held for sale — — 426 — — 426 Income taxes payable — — 10,058 — (16 ) 10,042 Total current liabilities 227,305 361,103 264,909 8,653 (396,742 ) 465,228 Long-term debt — 452,605 — — — 452,605 Long-term deferred taxes 1,196 — 15,299 — — 16,495 Other long-term liabilities — — 12,351 — — 12,351 Noncontrolling interests — — 5,373 — — 5,373 (Deficit) equity (228,501 ) (183,421 ) 630,287 54,497 (501,362 ) (228,500 ) Total liabilities and deficit $ — $ 630,287 $ 928,219 $ 63,150 $ (898,104 ) $ 723,552 Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Balance Sheet Information December 31, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ — $ 95,365 $ 13,417 $ — $ 108,782 Restricted cash — — 721 — — 721 Accounts receivable, net — — 389,773 11 (3,687 ) 386,097 Intercompany receivables — — 199,364 15,180 (214,544 ) — Prepaid expenses and other current assets — — 54,364 1,825 (506 ) 55,683 Assets held for sale — — 7,913 — — 7,913 Total current assets — — 747,500 30,433 (218,737 ) 559,196 Long-term restricted cash — — — — — — Property and equipment, net — — 14,617 1,077 — 15,694 Goodwill — — 9,694 32,399 — 42,093 Tradenames, net — — 28,536 — — 28,536 Other intangibles, net — — 113,256 223 — 113,479 Investment in subsidiaries — 650,005 55,460 — (705,465 ) — Long-term deferred taxes — — 13,364 — — 13,364 Other assets, net — — 10,616 1,711 — 12,327 Total assets $ — $ 650,005 $ 993,043 $ 65,843 $ (924,202 ) $ 784,689 LIABILITIES & EQUITY Current liabilities: Current portion of long-term debt $ — $ 184,866 $ — $ — $ — $ 184,866 Accounts payable — — 85,374 6,138 (902 ) 90,610 Accrued payroll and employee costs — — 96,800 3,881 — 100,681 Intercompany payables 45,079 154,285 15,180 — (214,544 ) — Deferred income taxes — — 27,310 24 — 27,334 Accrued liabilities 168,883 27,572 90,013 340 (172,090 ) 114,718 Liabilities held for sale — — 784 — — 784 Income taxes payable — — 8,214 — (84 ) 8,130 Total current liabilities 213,962 366,723 323,675 10,383 (387,620 ) 527,123 Long-term debt — 452,165 — — — 452,165 Other long-term liabilities — — 13,571 — — 13,571 Noncontrolling interests — — 5,792 — — 5,792 (Deficit) Equity (213,962 ) (168,883 ) 650,005 55,460 (536,582 ) (213,962 ) Total liabilities and deficit $ — $ 650,005 $ 993,043 $ 65,843 $ (924,202 ) $ 784,689 |
Condensed consolidating statement of cash flow information | Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Cash Flow Information For the Three Months Ended March 25, 2016 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net cash provided by (used in) operating activities $ 1,759 $ 35,267 $ (48,110 ) $ (19,056 ) $ (403 ) $ (30,543 ) Cash flows from investing activities: Purchase of property and equipment, net — — (788 ) (24 ) — (812 ) Purchase of software — — (1,261 ) — — (1,261 ) Contributions to equity method investees — — (1,225 ) — — (1,225 ) Transfers from (to) affiliates — — 37,277 23,767 (61,044 ) — Net cash provided by (used in) investing activities — — 34,003 23,743 (61,044 ) (3,298 ) Cash flows from financing activities: Equity contributions from affiliates to Cerberus — 250 — — — 250 Payments of dividends to Parent — — — (808 ) 404 (404 ) Transfers (to) from affiliates (1,759 ) (35,517 ) (23,767 ) — 61,043 — Net cash used in financing activities (1,759 ) (35,267 ) (23,767 ) (808 ) 61,447 (154 ) Net (decrease) increase in cash and cash equivalents — — (37,874 ) 3,879 — (33,995 ) Cash and cash equivalents, beginning of period — — 95,365 13,417 — 108,782 Cash and cash equivalents, end of period $ — $ — $ 57,491 $ 17,296 $ — $ 74,787 Delta Tucker Holdings, Inc. and Subsidiaries Unaudited Condensed Consolidating Statement of Cash Flow Information For The Three Months Ended March 27, 2015 (Amounts in thousands) Parent Subsidiary Issuer Subsidiary Guarantors Subsidiary Non- Guarantors Eliminations Consolidated Net cash provided by (used in) operating activities $ 1,571 $ (2,592 ) $ (20,968 ) $ (11,473 ) $ (101 ) $ (33,563 ) Cash flows from investing activities: Purchase of property and equipment, net — — (173 ) — — (173 ) Purchase of software — — (417 ) — — (417 ) Return of capital from equity method investees — — 1,822 — — 1,822 Contributions to equity method investees — — (500 ) — — (500 ) Transfers (to) from affiliates — — (1,021 ) 16,662 (15,641 ) — Net cash used in (provided by) investing activities — — (289 ) 16,662 (15,641 ) 732 Cash flows from financing activities: Borrowings on indebtedness — 34,900 — — — 34,900 Payments on indebtedness — (34,900 ) — — — (34,900 ) Payments under other financing arrangements — — (1,023 ) — — (1,023 ) Payments of dividends to Parent — — — (404 ) 101 (303 ) Transfers (to) from affiliates (1,571 ) 2,592 (16,662 ) — 15,641 — Net cash (used in) provided by financing activities (1,571 ) 2,592 (17,685 ) (404 ) 15,742 (1,326 ) Net (decrease) increase in cash and cash equivalents — — (38,942 ) 4,785 — (34,157 ) Cash and cash equivalents, beginning of period — — 87,300 6,704 — 94,004 Cash and cash equivalents, end of period $ — $ — $ 48,358 $ 11,489 $ — $ 59,847 |
Basis of Presentation and Acc31
Basis of Presentation and Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Accounting Policies [Abstract] | ||
Gross favorable adjustments | $ 6.7 | $ 3.2 |
Gross unfavorable adjustments | (2) | (5.8) |
Net adjustments | $ 4.7 | $ (2.6) |
Basis of Presentation and Acc32
Basis of Presentation and Accounting Policies (Details Textual) - USD ($) | Apr. 30, 2016 | Mar. 25, 2016 | Dec. 31, 2015 | Jul. 10, 2010 |
Debt Instrument [Line Items] | ||||
Debt Instrument, Other Loans to Revolver Commitment, Percent Maximum | 50.00% | |||
Long-term Debt, Gross | $ 642,272,000 | $ 642,272,000 | ||
Percentage of interest in joint venture | 100.00% | |||
Ownership in DIFZ, percent | 25.00% | |||
Deferred financing costs, net | $ 3,719,000 | $ 5,241,000 | ||
Term loan | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, face amount | $ 187,272,000 | |||
10.375% senior unsecured notes | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate, percent | 10.375% | 10.375% | 10.375% | |
Long-term Debt, Gross | $ 455,000,000 | |||
Debt instrument, face amount | $ 455,000,000 | |||
Cerberus 3L Note | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Interest Rate, Stated Percentage, Payable In-Kind | 5.00% | |||
London Interbank Offered Rate (LIBOR) | ||||
Debt Instrument [Line Items] | ||||
Applicable margin for term loan, percent | 6.00% | |||
London Interbank Offered Rate (LIBOR) | Term loan | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate, percent | 4.50% | |||
Subsequent Event | Term loan | ||||
Debt Instrument [Line Items] | ||||
Percent of loans to be restructured, percent | 69.00% | |||
Subsequent Event | 10.375% senior unsecured notes | ||||
Debt Instrument [Line Items] | ||||
Repayments of Senior Debt | $ 45,000,000 | |||
Subsequent Event | Senior Secured Second Lien Notes Due 2020 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate, percent | 11.875% | |||
Debt Instrument, Interest Rate, Stated Percentage, Payable in Cash | 10.375% | |||
Debt Instrument, Interest Rate, Stated Percentage, Payable In-Kind | 1.50% | |||
Debt instrument, face amount | $ 410,000,000 | |||
Subsequent Event | Cerberus 3L Note | ||||
Debt Instrument [Line Items] | ||||
Proceeds from Notes Payable | $ 30,000,000 | |||
Subsequent Event | Minimum | Term loan | ||||
Debt Instrument [Line Items] | ||||
Percent of loans to be restructured, percent | 90.00% | |||
Long-Term Debt Refinanced, Amount | $ 409,500,000 | |||
Accounting Standards Update 2015-03 | Prepaid Expenses and Other Current Assets | ||||
Debt Instrument [Line Items] | ||||
Deferred financing costs, net | $ (2,400,000) | |||
Accounting Standards Update 2015-03 | Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Deferred financing costs, net | $ 2,800,000 | |||
Accounting Standards Update 2015-03 | Current Portion of Long Term Debt | ||||
Debt Instrument [Line Items] | ||||
Deferred financing costs, net | 2,400,000 | |||
Accounting Standards Update 2015-03 | Other Assets | ||||
Debt Instrument [Line Items] | ||||
Deferred financing costs, net | $ (2,800,000) |
Composition of Certain Financ33
Composition of Certain Financial Statement Captions (Details) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Prepaid expenses and other current assets | ||
Prepaid expenses | $ 31,583 | $ 30,985 |
Income tax refunds receivable | 63 | 204 |
Inventories | 13,636 | 14,776 |
Work-in-process inventory | 1,733 | 1,733 |
Joint venture receivables | 351 | 460 |
Other current assets | 3,607 | 7,525 |
Total prepaid expenses and other current assets | $ 50,973 | $ 55,683 |
Composition of Certain Financ34
Composition of Certain Financial Statement Captions (Details 1) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Helicopters | $ 983 | $ 983 |
Computers and other equipment | 10,814 | 10,392 |
Leasehold improvements | 20,169 | 19,639 |
Office furniture and fixtures | 4,551 | 4,541 |
Gross property and equipment | 36,517 | 35,555 |
Less accumulated depreciation | (20,829) | (19,861) |
Total property and equipment, net | $ 15,688 | $ 15,694 |
Composition of Certain Financ35
Composition of Certain Financial Statement Captions (Details 2) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Investment in affiliates | $ 8,304 | $ 6,712 |
Palm promissory note, long-term portion | 1,708 | 2,079 |
Other | 5,744 | 3,536 |
Total other assets, net | $ 15,756 | $ 12,327 |
Composition of Certain Financ36
Composition of Certain Financial Statement Captions (Details 3) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Wages, compensation and other benefits | $ 79,400 | $ 85,216 |
Accrued vacation | 16,943 | 14,433 |
Accrued contributions to employee benefit plans | 1,229 | 1,032 |
Total accrued payroll and employee costs | $ 97,572 | $ 100,681 |
Composition of Certain Financ37
Composition of Certain Financial Statement Captions (Details 4) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Customer liabilities | $ 15,702 | $ 21,183 |
Accrued insurance | 27,472 | 35,530 |
Accrued interest | 11,864 | 24,370 |
Contract losses | 9,941 | 15,718 |
Legal reserves | 4,638 | 5,063 |
Subcontractor retention | 1,363 | 1,646 |
Other | 12,785 | 11,208 |
Total accrued liabilities | $ 83,765 | $ 114,718 |
Composition of Certain Financ38
Composition of Certain Financial Statement Captions (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | |||
Maximum percentage of prepaid expense on current assets | 5.00% | ||
Deferred financing costs, net | $ 3,719 | $ 5,241 | |
Other current assets | 3,607 | 7,525 | |
Assets held for sale | 6,155 | 7,913 | |
Liabilities held for sale | 426 | 784 | |
Property, plant and equipment, additions | 200 | 300 | |
Depreciation expense | 1,000 | $ 1,500 | |
Other long-term liabilities | 12,400 | 13,600 | |
Deferred compensation liability, classified, noncurrent | 3,500 | 4,400 | |
Inclusive of penalties | 3,300 | 3,300 | |
Facility | |||
Restructuring Cost and Reserve [Line Items] | |||
Other long-term liabilities included in long-term leasehold obligations | 3,700 | 3,800 | |
Accounting Standards Update 2015-03 | Current Portion of Long Term Debt | |||
Restructuring Cost and Reserve [Line Items] | |||
Deferred financing costs, net | 2,400 | ||
Accounting Standards Update 2015-03 | Long-term Debt | |||
Restructuring Cost and Reserve [Line Items] | |||
Deferred financing costs, net | 2,800 | ||
Accounting Standards Update 2015-03 | Prepaid Expenses and Other Current Assets | |||
Restructuring Cost and Reserve [Line Items] | |||
Deferred financing costs, net | $ (2,400) | ||
Accounting Standards Update 2015-03 | Other Assets | |||
Restructuring Cost and Reserve [Line Items] | |||
Deferred financing costs, net | $ (2,800) |
Goodwill and Other Intangible39
Goodwill and Other Intangible Assets (Details) $ in Thousands | 3 Months Ended |
Mar. 25, 2016USD ($) | |
Goodwill balances for segments | |
Goodwill balance as of December 31, 2015 | $ 42,093 |
Goodwill balance as of March 25, 2016 | 42,093 |
Operating Segments | |
Goodwill balances for segments | |
Goodwill balance as of December 31, 2015 | 42,093 |
Changes between January 1, 2016 and March 25, 2016 | 0 |
Goodwill balance as of March 25, 2016 | 42,093 |
Operating Segments | DynAviation | |
Goodwill balances for segments | |
Goodwill balance as of December 31, 2015 | 0 |
Changes between January 1, 2016 and March 25, 2016 | 0 |
Goodwill balance as of March 25, 2016 | 0 |
Operating Segments | DynLogistics | |
Goodwill balances for segments | |
Goodwill balance as of December 31, 2015 | 42,093 |
Changes between January 1, 2016 and March 25, 2016 | 0 |
Goodwill balance as of March 25, 2016 | $ 42,093 |
Goodwill and Other Intangible40
Goodwill and Other Intangible Assets (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 25, 2016 | Dec. 31, 2015 | |
Information about changes relating to certain intangible assets | ||
Indefinite-lived assets | $ 28,536 | $ 28,536 |
Indefinite-lived assets, transfer to assets held for sale | 0 | |
Total finite-lived and definite-lived assets, transfer to assets held for sale | $ (11) | |
Customer-related intangible assets | ||
Information about changes relating to certain intangible assets | ||
Finite-lived assets, weighted average remaining useful years (in years) | 3 years 8 months 12 days | 4 years |
Finite-lived assets, gross carrying value | $ 252,615 | $ 252,615 |
Finite-lived assets, accumulated amortization | (149,119) | (142,020) |
Finite-lived assets, impairment | 0 | |
Total | $ 103,496 | $ 110,595 |
Other intangible assets | ||
Information about changes relating to certain intangible assets | ||
Finite-lived assets, weighted average remaining useful years (in years) | 10 months 24 days | 8 months 12 days |
Finite-lived assets, gross carrying value | $ 14,580 | $ 13,325 |
Finite-lived assets, accumulated amortization | (10,834) | (10,430) |
Finite-lived assets, impairment | 0 | (5,059) |
Finite-lived assets, transfer to assets held for sale | (31) | (11) |
Total | 3,715 | 2,884 |
Indefinite-lived assets, gross carrying value | 0 | 5,059 |
Indefinite-lived assets, impairment | 0 | (5,059) |
Indefinite-lived assets, transfer to assets held for sale | 0 | |
Indefinite Lived , Net of Impairment | 0 | 0 |
Total finite-lived and indefinite-lived assets, gross carrying value | 267,195 | 270,999 |
Total finite-lived and indefinite-lived assets, accumulated amortization | (159,953) | (152,450) |
Total finite-lived and definite-lived assets, transfer to assets held for sale | (31) | |
Total finite-lived and definite-lived assets, net | $ 107,211 | $ 113,479 |
Tradenames | ||
Information about changes relating to certain intangible assets | ||
Finite-lived assets, weighted average remaining useful years (in years) | 0 years | 0 years |
Finite-lived assets, gross carrying value | $ 869 | $ 869 |
Finite-lived assets, accumulated amortization | (869) | (869) |
Finite-lived assets, impairment | (164) | |
Total | 0 | |
Indefinite-lived assets | 28,536 | 28,700 |
Indefinite-lived assets, impairment | (164) | |
Indefinite-lived assets, transfer to assets held for sale | 0 | |
Indefinite Lived , Net of Impairment | 28,536 | 28,536 |
Total finite-lived and indefinite-lived assets, gross carrying value | 29,405 | 29,569 |
Total finite-lived and indefinite-lived assets, accumulated amortization | (869) | (869) |
Total finite-lived and definite-lived assets, transfer to assets held for sale | 0 | |
Total finite-lived and definite-lived assets, net | $ 28,536 | $ 28,536 |
Goodwill and Other Intangible41
Goodwill and Other Intangible Assets (Details Textual) $ in Millions | 3 Months Ended | ||
Mar. 25, 2016USD ($)reporting_unitoperating_and_reporting_segment | Mar. 27, 2015USD ($) | Dec. 31, 2015USD ($) | |
Subsidiary or Equity Method Investee [Line Items] | |||
Number of operating and reportable segment | operating_and_reporting_segment | 2 | ||
Number of reportable segments | 5 | ||
Number of reporting segments with recorded goodwill | 2 | ||
Amortization expense | $ | $ 7.5 | $ 6.3 | |
Capitalized software gross value | $ | $ 3.7 | $ 2.9 | |
DynAviation | |||
Subsidiary or Equity Method Investee [Line Items] | |||
Number of reportable segments | 2 | ||
DynLogistics | |||
Subsidiary or Equity Method Investee [Line Items] | |||
Number of reportable segments | 3 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Domestic and foreign components of Income (loss) before income taxes | ||
Domestic | $ (10,592) | $ (11,325) |
Foreign | 514 | 731 |
Loss before income taxes | $ (10,078) | $ (10,594) |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Deferred tax assets and liabilities | ||
Current deferred tax liabilities, net | $ 0 | $ (27,334) |
Non-current deferred tax (liabilities) assets, net | (16,495) | 0 |
Long-term deferred taxes | 0 | 13,364 |
Deferred tax liabilities, net | $ (16,495) | $ (13,970) |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 25, 2016 | Mar. 27, 2015 | Dec. 31, 2015 | |
Operating Loss Carryforwards [Line Items] | |||
Effective tax rate | (44.60%) | (35.90%) | |
Valuation allowance | $ 78,700,000 | $ 71,600,000 | |
Unrecognized tax benefit | 2,600,000 | 2,600,000 | |
Unrecognized tax benefits if recognized, affect effective tax rate | 2,300,000 | 2,300,000 | |
Inclusive of penalties | 3,300,000 | $ 3,300,000 | |
Income taxes paid, net | (3,000) | $ 3,022,000 | |
Domestic Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Income taxes paid, net | $ 0 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable, net | $ 381,632 | $ 386,097 |
Billed | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable, net | 162,367 | 136,127 |
Unbilled | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total accounts receivable, net | $ 219,265 | $ 249,970 |
Accounts Receivable (Details Te
Accounts Receivable (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 25, 2016 | Dec. 31, 2015 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unbilled receivables | $ 29.5 | $ 21.3 |
Allowance for Doubtful Accounts Receivable, Period Increase (Decrease) | $ 16.4 | 16.3 |
UNITED STATES | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts Receivable, Net | $ 26 |
Fair Value of Financial Asset47
Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 | Jul. 10, 2010 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Gross | $ 642,272 | $ 642,272 | |
Estimate of the fair value of long-term debt based on quoted prices in active markets | |||
Total indebtedness | 638,553 | 637,031 | |
Less current portion of long-term debt | (187,272) | (187,272) | |
Total long-term debt | 455,000 | $ 455,000 | |
10.375% senior unsecured notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Gross | $ 455,000 | ||
Stated interest rate, percent | 10.375% | 10.375% | 10.375% |
Fair Value, Measurements, Recurring | |||
Estimate of the fair value of long-term debt based on quoted prices in active markets | |||
Total indebtedness | $ 540,268 | $ 517,619 | |
Less current portion of long-term debt | (180,249) | (179,781) | |
Total long-term debt | 360,019 | 337,838 | |
Fair Value, Measurements, Recurring | 10.375% senior unsecured notes | |||
Estimate of the fair value of long-term debt based on quoted prices in active markets | |||
Total indebtedness | 360,019 | 337,838 | |
Fair Value, Measurements, Recurring | Term loan | |||
Estimate of the fair value of long-term debt based on quoted prices in active markets | |||
Total indebtedness | 180,249 | 179,781 | |
Fair Value, Measurements, Recurring | Reported Value Measurement | |||
Estimate of the fair value of long-term debt based on quoted prices in active markets | |||
Total indebtedness | 642,272 | 642,272 | |
Less current portion of long-term debt | (187,272) | (187,272) | |
Total long-term debt | 455,000 | 455,000 | |
Fair Value, Measurements, Recurring | Reported Value Measurement | 10.375% senior unsecured notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Gross | 455,000 | 455,000 | |
Estimate of the fair value of long-term debt based on quoted prices in active markets | |||
Total indebtedness | 452,605 | 452,165 | |
Fair Value, Measurements, Recurring | Reported Value Measurement | Term loan | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term Debt, Gross | 187,272 | 187,272 | |
Estimate of the fair value of long-term debt based on quoted prices in active markets | |||
Total indebtedness | $ 185,948 | $ 184,866 |
Debt (Details 1)
Debt (Details 1) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 | Jul. 10, 2010 |
Debt Instrument [Line Items] | |||
Total indebtedness | $ 642,272 | $ 642,272 | |
Deferred Financing Costs, Net | (3,719) | (5,241) | |
Carrying Amount less Deferred Financing Costs, Net | 638,553 | 637,031 | |
Less current portion of long-term debt | (187,272) | (187,272) | |
Deferred Finance Costs, Current, Net | 1,324 | 2,406 | |
Long-term Debt, Current Maturities, Net of Deferred Financing Costs | 185,948 | 184,866 | |
Total long-term debt | 455,000 | 455,000 | |
Deferred Finance Costs, Noncurrent, Net | (2,395) | (2,835) | |
Long-term Debt, Excluding Current Maturities, Net of Deferred Financing Costs | $ 452,605 | $ 452,165 | |
10.375% senior unsecured notes | |||
Debt Instrument [Line Items] | |||
Stated interest rate, percent | 10.375% | 10.375% | 10.375% |
Total indebtedness | $ 455,000 | ||
Fair Value, Measurements, Recurring | |||
Debt Instrument [Line Items] | |||
Carrying Amount less Deferred Financing Costs, Net | 540,268 | $ 517,619 | |
Less current portion of long-term debt | (180,249) | (179,781) | |
Total long-term debt | 360,019 | 337,838 | |
Fair Value, Measurements, Recurring | 10.375% senior unsecured notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount less Deferred Financing Costs, Net | 360,019 | 337,838 | |
Fair Value, Measurements, Recurring | Term loan | |||
Debt Instrument [Line Items] | |||
Carrying Amount less Deferred Financing Costs, Net | 180,249 | 179,781 | |
Fair Value, Measurements, Recurring | Reported Value Measurement | |||
Debt Instrument [Line Items] | |||
Carrying Amount less Deferred Financing Costs, Net | 642,272 | 642,272 | |
Less current portion of long-term debt | (187,272) | (187,272) | |
Total long-term debt | 455,000 | 455,000 | |
Fair Value, Measurements, Recurring | Reported Value Measurement | 10.375% senior unsecured notes | |||
Debt Instrument [Line Items] | |||
Total indebtedness | 455,000 | 455,000 | |
Deferred Financing Costs, Net | (2,395) | (2,835) | |
Carrying Amount less Deferred Financing Costs, Net | 452,605 | 452,165 | |
Fair Value, Measurements, Recurring | Reported Value Measurement | Term loan | |||
Debt Instrument [Line Items] | |||
Total indebtedness | 187,272 | 187,272 | |
Deferred Financing Costs, Net | (1,324) | (2,406) | |
Carrying Amount less Deferred Financing Costs, Net | $ 185,948 | $ 184,866 |
Debt (Details 2)
Debt (Details 2) | Apr. 30, 2016 | Mar. 25, 2016 |
Total Leverage Ratio | ||
December 31, 2016 | 7.60 | |
March 31, 2017 | 6.90 | |
June 30, 2017 | 6.60 | |
Interest Coverage Ratio | ||
March 25, 2016 | 1.15 | |
June 24, 2016 | 1.20 | |
September 30, 2016 | 1.30 | |
Scenario, Forecast | ||
Total Leverage Ratio | ||
June 24, 2016 | 7.40 | |
September 30, 2016 | 7.50 | |
December 31, 2016 | 7.40 | |
March 31, 2017 | 7.30 | |
June 30, 2017 | 6.75 | |
September 29, 2017 | 6.50 | |
December 31, 2017 | 5.75 | |
March 30, 2018 | 5.75 | |
June 29, 2018 | 5.50 | |
September 28, 2018 | 5.4 | |
September 29, 2018 | 4.75 | |
Interest Coverage Ratio | ||
June 24, 2016 | 1.15 | |
September 30, 2016 | 1.15 | |
December 31, 2016 | 1.15 | |
March 31, 2017 | 1.20 | |
June 30, 2017 | 1.20 | |
September 29, 2017 | 1.30 | |
December 31, 2017 | 1.40 | |
March 30, 2018 | 1.50 | |
June 29, 2018 | 1.60 | |
June 30, 2018 and thereafter | 1.70 | |
Subsequent Event | ||
Total Leverage Ratio | ||
March 25, 2016 | 7.6 | |
Interest Coverage Ratio | ||
March 25, 2016 | 1.15 |
Debt (Details 3)
Debt (Details 3) - 10.375% senior unsecured notes | 3 Months Ended |
Mar. 25, 2016 | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, percentage of principle | 101.00% |
2,015 | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, percentage of principle | 102.60% |
2016 and thereafter | |
Debt Instrument, Redemption [Line Items] | |
Redemption price, percentage of principle | 100.00% |
Debt (Details Textual)
Debt (Details Textual) | Apr. 30, 2016USD ($)covenant | Apr. 06, 2016USD ($) | Mar. 25, 2016USD ($) | Mar. 27, 2015USD ($) | Jun. 24, 2016 | May. 09, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Jul. 10, 2010USD ($) |
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio, December 31, 2016 | 7.60 | ||||||||
Deferred financing costs, net | $ 3,719,000 | $ 5,241,000 | |||||||
Amortization of financing costs | 1,500,000 | $ 1,500,000 | |||||||
Additional available borrowing capacity | $ 29,800,000 | 102,200,000 | |||||||
Debt Instrument, Other Loans to Revolver Commitment, Percent Maximum | 50.00% | ||||||||
Cash and Cash Equivalents, at Carrying Value | $ 74,787,000 | $ 59,847,000 | 108,782,000 | $ 94,004,000 | |||||
Long-term Debt, Gross | 642,272,000 | 642,272,000 | |||||||
Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility, maximum borrowing | 144,800,000 | ||||||||
Letter of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility, maximum borrowing | 100,000,000 | ||||||||
Additional available borrowing capacity | $ 42,600,000 | $ 42,600,000 | |||||||
Unused commitment fee on revolver, percent | 0.50% | ||||||||
Applicable interest rates for letter of credit sub-facility | 4.25% | 4.25% | |||||||
Line of credit fronting fee rate, percent | 0.25% | ||||||||
Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 187,272,000 | ||||||||
Applicable interest rate for term loan, percent | 6.25% | 6.253% | |||||||
Repayments of Debt | $ 0 | ||||||||
10.375% senior unsecured notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 455,000,000 | ||||||||
Long-term Debt, Gross | $ 455,000,000 | ||||||||
Stated interest rate, percent | 10.375% | 10.375% | 10.375% | ||||||
Maturity period of quarterly principle payments | Jul. 1, 2017 | ||||||||
Trigger amount of asset sales and change of control events for repurchase of notes at defined prices | $ 15,000,000 | ||||||||
Debt instrument, repurchase requirement, percentage of principal | 100.00% | ||||||||
Redemption price, percentage of principle | 101.00% | ||||||||
Market value of unsecured loans as percentage of stated value | 79.10% | 74.30% | |||||||
Cerberus 3L Note | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage, Payable In-Kind | 5.00% | ||||||||
Minimum | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Unused commitment fee on revolver, percent | 0.50% | ||||||||
Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt less unrestricted cash and cash equivalents | $ 75,000,000 | ||||||||
Maximum | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Unused commitment fee on revolver, percent | 0.75% | ||||||||
London Interbank Offered Rate (LIBOR) | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 6.00% | ||||||||
Floor for euro currency rate, percent | 1.75% | ||||||||
London Interbank Offered Rate (LIBOR) | Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Stated interest rate, percent | 4.50% | ||||||||
London Interbank Offered Rate (LIBOR) | Minimum | Letter of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 4.00% | ||||||||
London Interbank Offered Rate (LIBOR) | Maximum | Letter of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 4.50% | ||||||||
Base Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Minimum spread over other variable rates, percent | 1.00% | ||||||||
Floor variable base rate, percent | 2.75% | ||||||||
Base Rate | Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Stated interest rate, percent | 3.50% | ||||||||
Base Rate | Minimum | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 3.00% | ||||||||
Base Rate | Maximum | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 3.50% | ||||||||
Subsequent Event | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio, March 25, 2016 | 7.6 | ||||||||
Additional available borrowing capacity | $ 102,200,000 | ||||||||
Debt Instrument, Number of Covenants | covenant | 2 | ||||||||
Subsequent Event | Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of Credit Facility, Minimum Liquidity Requirement, Amount First Year | $ 60,000,000 | ||||||||
Line of Credit Facility, Minimum Liquidity Requirement, Amount Thereafter | 50,000,000 | ||||||||
Line of Credit Facility, Incremental Maximum Borrowing Capacity | $ 15,000,000 | ||||||||
Subsequent Event | Letter of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Unused commitment fee on revolver, percent | 0.50% | ||||||||
Subsequent Event | Revolving Credit Facility, Class A | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility, maximum borrowing | $ 24,800,000 | ||||||||
Subsequent Event | Revolving Credit Facility, Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility, maximum borrowing | $ 107,300,000 | ||||||||
Debt Instrument, Fee | 0.02 | ||||||||
Subsequent Event | Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, additional principal payment | $ 4,600,000 | ||||||||
Subsequent Event | New Term Loan Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Fee | 0.07 | ||||||||
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year | $ 22,500,000 | ||||||||
Long-term Debt, Maturities, Repayments of Principal in Year Two | $ 22,500,000 | ||||||||
Subsequent Event | 10.375% senior unsecured notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of Credit Facility, Excess Cash Flow Required to be Used Towards Principal Repayment, Percent | 100.00% | ||||||||
Subsequent Event | Cerberus 3L Note | |||||||||
Debt Instrument [Line Items] | |||||||||
Proceeds from Notes Payable | $ 30,000,000 | ||||||||
Debt Instrument, Covenant, Decrease in Covenant Restrictiveness | 25.00% | ||||||||
Subsequent Event | Maximum | Revolving Credit Facility, Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Cash and Cash Equivalents, at Carrying Value | $ 60,000,000 | ||||||||
Subsequent Event | Eurocurrency Rate | New Term Loan Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 6.00% | ||||||||
Subsequent Event | Eurocurrency Rate | Minimum | Revolving Credit Facility, Class A | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 4.00% | ||||||||
Subsequent Event | Eurocurrency Rate | Minimum | Revolving Credit Facility, Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 5.50% | ||||||||
Unused commitment fee on revolver, percent | 0.50% | ||||||||
Subsequent Event | Eurocurrency Rate | Maximum | Revolving Credit Facility, Class A | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 4.50% | ||||||||
Subsequent Event | Eurocurrency Rate | Maximum | Revolving Credit Facility, Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 6.00% | ||||||||
Unused commitment fee on revolver, percent | 0.75% | ||||||||
Subsequent Event | London Interbank Offered Rate (LIBOR) | |||||||||
Debt Instrument [Line Items] | |||||||||
Floor for euro currency rate, percent | 1.75% | ||||||||
Subsequent Event | Base Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Minimum spread over other variable rates, percent | 1.00% | ||||||||
Subsequent Event | Base Rate | New Term Loan Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 5.00% | ||||||||
Subsequent Event | Base Rate | Minimum | Revolving Credit Facility, Class A | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 3.00% | ||||||||
Subsequent Event | Base Rate | Minimum | Revolving Credit Facility, Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 4.50% | ||||||||
Subsequent Event | Base Rate | Maximum | Revolving Credit Facility, Class A | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 3.50% | ||||||||
Subsequent Event | Base Rate | Maximum | Revolving Credit Facility, Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable margin for term loan, percent | 5.00% | ||||||||
Fair Value, Measurements, Recurring | Reported Value Measurement | Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Deferred financing costs, net | $ 1,324,000 | $ 2,406,000 | |||||||
Long-term Debt, Gross | 187,272,000 | 187,272,000 | |||||||
Fair Value, Measurements, Recurring | Reported Value Measurement | 10.375% senior unsecured notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Deferred financing costs, net | 2,395,000 | 2,835,000 | |||||||
Long-term Debt, Gross | 455,000,000 | 455,000,000 | |||||||
Fair Value, Measurements, Recurring | Reported Value Measurement | Subsequent Event | New Term Loan Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term Debt, Gross | $ 207,300,000 | ||||||||
Scenario, Forecast | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum total leverage ratio, June 24, 2016 | 7.40 | ||||||||
Maximum total leverage ratio, September 30, 2016 | 7.50 | ||||||||
Maximum total leverage ratio, December 31, 2016 | 7.40 | ||||||||
Scenario, Forecast | Revolving Credit Facility, Class B | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of Credit Facility, Reduction of Credit Line, Percent | 20.00% | ||||||||
Accounting Standards Update 2015-03 | Prepaid Expenses and Other Current Assets | |||||||||
Debt Instrument [Line Items] | |||||||||
Deferred financing costs, net | $ (2,400,000) | ||||||||
Accounting Standards Update 2015-03 | Current Portion of Long Term Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Deferred financing costs, net | 2,400,000 | ||||||||
Accounting Standards Update 2015-03 | Long-term Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Deferred financing costs, net | 2,800,000 | ||||||||
Accounting Standards Update 2015-03 | Other Assets | |||||||||
Debt Instrument [Line Items] | |||||||||
Deferred financing costs, net | $ (2,800,000) |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Feb. 23, 2014USD ($) | Jan. 22, 2014USD ($) | Jan. 12, 2010plaintiff | Mar. 26, 2008plaintiff | Sep. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Mar. 25, 2016USD ($)lawsuitResident | Mar. 27, 2015USD ($) | Dec. 31, 2015USD ($) | May. 31, 2014USD ($) |
Loss Contingencies [Line Items] | ||||||||||
Lease rental expense | $ 8,200,000 | $ 14,000,000 | ||||||||
Other accrued liabilities | $ 4,638,000 | $ 5,063,000 | ||||||||
Number of lawsuits | lawsuit | 4 | |||||||||
Number of individual plaintiffs | plaintiff | 1,256 | 3,266 | ||||||||
Number of residents seeking unspecified damages | Resident | 26 | |||||||||
Number of individual plaintiffs, dismissed | plaintiff | 15 | |||||||||
Costs and Expenses, Audit Costs Settled | $ 1,400,000 | |||||||||
Period range on the war reserve material program | 2000 to 2011 | |||||||||
Liability for unpaid claims and claims adjustment expense, Incurred but not reported (IBNR) claims, amount | $ 10,700,000 | $ 11,000,000 | ||||||||
Fixed amount of stop loss coverage on policies | 1,000,000 | |||||||||
Maximum | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Fixed amount of stop loss coverage on policies | 750,000 | |||||||||
Minimum | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Fixed amount of stop loss coverage on policies | 250,000 | |||||||||
California Policy | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Fixed amount of stop loss coverage on policies | 250,000 | |||||||||
Foreign Tax Authority | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Contract limits to damages maximum amount | $ 64,200,000 | |||||||||
Income tax issue resolved in favor of company | $ 54,000,000 | |||||||||
Collectibility of Receivables | Pending Litigation | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Contract limits to damages maximum amount | $ 41,000,000 | |||||||||
Unfavorable Regulatory Action | Pending Litigation | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Estimate of possible loss | 1,800,000 | |||||||||
Other Matters | Foreign Tax Authority | Afghanistan | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Contract limits to damages maximum amount | $ 10,200,000 | |||||||||
Northrop Grumman Technical Services, Inc. | Performance Guarantee | Pending Litigation | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Contract limits to damages maximum amount | $ 5,000,000 | |||||||||
LOGCAP IV | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Costs and expenses | $ 48,000,000 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 25, 2016 | Mar. 27, 2015 | ||
Summary of the financial information of the reportable segments reconciled | |||
Total revenue | $ 419,990 | $ 467,022 | |
Total operating income (loss) | 5,478 | 4,450 | |
Total depreciation and amortization | 8,516 | 7,798 | |
Operating Segments | |||
Summary of the financial information of the reportable segments reconciled | |||
Total revenue | 419,990 | 467,022 | |
Total operating income (loss) | 5,478 | 4,450 | |
Total depreciation and amortization | [1] | 8,516 | 7,798 |
Operating Segments | DynAviation | |||
Summary of the financial information of the reportable segments reconciled | |||
Total revenue | 288,510 | 309,905 | |
Total operating income (loss) | 10,699 | 4,598 | |
Total depreciation and amortization | 163 | 158 | |
Operating Segments | DynLogistics | |||
Summary of the financial information of the reportable segments reconciled | |||
Total revenue | 131,189 | 156,400 | |
Total operating income (loss) | 9,956 | 7,709 | |
Total depreciation and amortization | 62 | 820 | |
Operating Segments | Headquarters / Other | |||
Summary of the financial information of the reportable segments reconciled | |||
Total revenue | [2] | 291 | 717 |
Total operating income (loss) | [3] | (15,177) | (7,857) |
Total depreciation and amortization | $ 8,291 | $ 6,820 | |
[1] | Includes amounts in Cost of services of $0.2 million and $0.5 million for the three months ended March 25, 2016 and March 27, 2015, respectively. | ||
[2] | Headquarters revenue primarily represents revenue earned on shared services arrangements for general and administrative services provided to unconsolidated joint ventures and elimination of intercompany items between segments. | ||
[3] | Headquarters operating expenses primarily relates to amortization of intangible assets and other costs that are not allocated to segments and are not billable to our U.S. government customers, partially offset by equity method investee income. |
Segment Information (Details 1)
Segment Information (Details 1) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 | |
ASSETS | |||
Assets | $ 723,552 | $ 784,689 | |
Operating Segments | |||
ASSETS | |||
Assets | 723,552 | 784,689 | |
Operating Segments | DynAviation | |||
ASSETS | |||
Assets | 335,201 | 351,627 | |
Operating Segments | DynLogistics | |||
ASSETS | |||
Assets | 180,427 | 173,036 | |
Operating Segments | Headquarters / Other | |||
ASSETS | |||
Assets | [1] | $ 207,924 | $ 260,026 |
[1] | Assets primarily include cash, investments in unconsolidated subsidiaries, and intangible assets (excluding goodwill). |
Segment Information (Details Te
Segment Information (Details Textual) $ in Millions | 3 Months Ended | |
Mar. 25, 2016USD ($)operating_and_reporting_segment | Mar. 27, 2015USD ($) | |
Segment Reporting [Abstract] | ||
Number of operating and reportable segment | operating_and_reporting_segment | 2 | |
Cost of services | $ | $ 0.2 | $ 0.5 |
Related Parties, Joint Ventur56
Related Parties, Joint Ventures and Variable Interest Entities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 25, 2016 | Mar. 27, 2015 | Dec. 31, 2015 | |
Variable Interest Entity [Line Items] | |||
Assets | $ 723,552 | $ 784,689 | |
Liabilities | 946,679 | 992,859 | |
Revenue | 419,990 | $ 467,022 | |
DynCorp International FZ-LLC | |||
Variable Interest Entity [Line Items] | |||
Assets | 5,000 | 4,700 | |
Liabilities | 2,000 | 1,100 | |
Revenue | 39,800 | 51,700 | |
Equity Method Investee | |||
Variable Interest Entity [Line Items] | |||
Current assets | 36,800 | 32,200 | |
Total assets | 37,400 | 32,200 | |
Current liabilities | 18,400 | 12,500 | |
Total liabilities | 18,400 | $ 12,500 | |
Revenue | 14,700 | 45,800 | |
Gross profit | 300 | 5,100 | |
Net income | $ 400 | $ 4,000 |
Related Parties, Joint Ventur57
Related Parties, Joint Ventures and Variable Interest Entities (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 25, 2016 | Mar. 27, 2015 | Dec. 31, 2015 | |
Variable Interest Entity [Line Items] | |||
Cerberus consulting fees | $ 1,800 | $ 1,700 | |
Administrative fees | 600 | 900 | |
Receivables due from related parties | 400 | $ 500 | |
Receivable from unconsolidated joint ventures | 0 | 100 | |
Related cost of services | 200 | 200 | |
Earnings from equity method investees | 367 | 68 | |
Revenue | 419,990 | 467,022 | |
GLS | |||
Variable Interest Entity [Line Items] | |||
Revenue | 9,900 | 6,700 | |
Net income | 800 | 600 | |
Palm Trading Investment Corp | |||
Variable Interest Entity [Line Items] | |||
Aggregate initial value of promissory note from Palm | 9,200 | ||
Outstanding balance of loan | 2,400 | $ 2,500 | |
Trading Investment Corp | |||
Variable Interest Entity [Line Items] | |||
Investment in unconsolidated subsidiaries | 8,300 | ||
Includes operationally integral and non-integral income | |||
Variable Interest Entity [Line Items] | |||
Earnings from equity method investees | $ 400 | $ 500 |
Consolidating Financial State58
Consolidating Financial Statements of Subsidiary Guarantors (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Condensed Financial Statements, Captions [Line Items] | ||
Revenue | $ 419,990 | $ 467,022 |
Cost of services | (372,498) | (424,158) |
Selling, general and administrative expenses | (34,090) | (31,223) |
Depreciation and amortization expense | (8,291) | (7,259) |
Earnings from equity method investees | 367 | 68 |
Operating income | 5,478 | 4,450 |
Interest expense | (15,968) | (16,055) |
Interest income | 60 | 17 |
Equity in loss of consolidated subsidiaries | 0 | 0 |
Other income, net | 352 | 994 |
Loss before income taxes | (10,078) | (10,594) |
Benefit (provision) for income taxes | (4,494) | (3,809) |
Net loss | (14,572) | (14,403) |
Noncontrolling interests | (187) | (431) |
Net loss attributable to Delta Tucker Holdings, Inc. | (14,759) | (14,834) |
Parent | ||
Condensed Financial Statements, Captions [Line Items] | ||
Revenue | 0 | 0 |
Cost of services | 0 | 0 |
Selling, general and administrative expenses | 0 | 0 |
Depreciation and amortization expense | 0 | 0 |
Earnings from equity method investees | 0 | 0 |
Operating income | 0 | 0 |
Interest expense | 0 | 0 |
Interest income | 0 | 0 |
Equity in loss of consolidated subsidiaries | (14,759) | (14,834) |
Other income, net | 0 | 0 |
Loss before income taxes | (14,759) | (14,834) |
Benefit (provision) for income taxes | 0 | 0 |
Net loss | (14,759) | (14,834) |
Noncontrolling interests | 0 | 0 |
Net loss attributable to Delta Tucker Holdings, Inc. | (14,759) | (14,834) |
Subsidiary Issuer | ||
Condensed Financial Statements, Captions [Line Items] | ||
Revenue | 0 | 0 |
Cost of services | 0 | 0 |
Selling, general and administrative expenses | 0 | 0 |
Depreciation and amortization expense | 0 | 0 |
Earnings from equity method investees | 0 | 0 |
Operating income | 0 | 0 |
Interest expense | (15,278) | (15,574) |
Interest income | 0 | 0 |
Equity in loss of consolidated subsidiaries | (4,828) | (4,711) |
Other income, net | 0 | 0 |
Loss before income taxes | (20,106) | (20,285) |
Benefit (provision) for income taxes | 5,347 | 5,451 |
Net loss | (14,759) | (14,834) |
Noncontrolling interests | 0 | 0 |
Net loss attributable to Delta Tucker Holdings, Inc. | (14,759) | (14,834) |
Subsidiary Guarantors | ||
Condensed Financial Statements, Captions [Line Items] | ||
Revenue | 423,427 | 471,525 |
Cost of services | (375,778) | (429,391) |
Selling, general and administrative expenses | (34,082) | (31,231) |
Depreciation and amortization expense | (8,124) | (6,683) |
Earnings from equity method investees | 367 | 68 |
Operating income | 5,810 | 4,288 |
Interest expense | (690) | (481) |
Interest income | 59 | 16 |
Equity in loss of consolidated subsidiaries | (547) | (502) |
Other income, net | 359 | 912 |
Loss before income taxes | 4,991 | 4,233 |
Benefit (provision) for income taxes | (9,819) | (8,943) |
Net loss | (4,828) | (4,710) |
Noncontrolling interests | 0 | 0 |
Net loss attributable to Delta Tucker Holdings, Inc. | (4,828) | (4,710) |
Subsidiary Non- Guarantors | ||
Condensed Financial Statements, Captions [Line Items] | ||
Revenue | 44,818 | 57,266 |
Cost of services | (44,959) | (56,520) |
Selling, general and administrative expenses | (22) | (8) |
Depreciation and amortization expense | (169) | (576) |
Earnings from equity method investees | 0 | 0 |
Operating income | (332) | 162 |
Interest expense | 0 | 0 |
Interest income | 1 | 1 |
Equity in loss of consolidated subsidiaries | 0 | 0 |
Other income, net | (7) | 82 |
Loss before income taxes | (338) | 245 |
Benefit (provision) for income taxes | (22) | (317) |
Net loss | (360) | (72) |
Noncontrolling interests | (187) | (431) |
Net loss attributable to Delta Tucker Holdings, Inc. | (547) | (503) |
Eliminations | ||
Condensed Financial Statements, Captions [Line Items] | ||
Revenue | (48,255) | (61,769) |
Cost of services | 48,239 | 61,753 |
Selling, general and administrative expenses | 14 | 16 |
Depreciation and amortization expense | 2 | 0 |
Earnings from equity method investees | 0 | 0 |
Operating income | 0 | 0 |
Interest expense | 0 | 0 |
Interest income | 0 | 0 |
Equity in loss of consolidated subsidiaries | 20,134 | 20,047 |
Other income, net | 0 | 0 |
Loss before income taxes | 20,134 | 20,047 |
Benefit (provision) for income taxes | 0 | 0 |
Net loss | 20,134 | 20,047 |
Noncontrolling interests | 0 | 0 |
Net loss attributable to Delta Tucker Holdings, Inc. | $ 20,134 | $ 20,047 |
Consolidating Financial State59
Consolidating Financial Statements of Subsidiary Guarantors (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Mar. 27, 2015 | |
Condensed Consolidating Statement of Comprehensive Income Information | ||
Net loss | $ (14,572) | $ (14,403) |
Other comprehensive income: | ||
Currency translation adjustment | 3 | (113) |
Other comprehensive income (loss), before tax | 3 | (113) |
Income tax expense related to items of other comprehensive income | (1) | 40 |
Other comprehensive income (loss) | 2 | (73) |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,570) | (14,476) |
Noncontrolling interests | (187) | (431) |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,757) | (14,907) |
Parent | ||
Condensed Consolidating Statement of Comprehensive Income Information | ||
Net loss | (14,759) | (14,834) |
Other comprehensive income: | ||
Currency translation adjustment | 3 | (113) |
Other comprehensive income (loss), before tax | 3 | (113) |
Income tax expense related to items of other comprehensive income | (1) | 40 |
Other comprehensive income (loss) | 2 | (73) |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,757) | (14,907) |
Noncontrolling interests | 0 | 0 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,757) | (14,907) |
Subsidiary Issuer | ||
Condensed Consolidating Statement of Comprehensive Income Information | ||
Net loss | (14,759) | (14,834) |
Other comprehensive income: | ||
Currency translation adjustment | 3 | (113) |
Other comprehensive income (loss), before tax | 3 | (113) |
Income tax expense related to items of other comprehensive income | (1) | 40 |
Other comprehensive income (loss) | 2 | (73) |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,757) | (14,907) |
Noncontrolling interests | 0 | 0 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (14,757) | (14,907) |
Subsidiary Guarantors | ||
Condensed Consolidating Statement of Comprehensive Income Information | ||
Net loss | (4,828) | (4,710) |
Other comprehensive income: | ||
Currency translation adjustment | 0 | 0 |
Other comprehensive income (loss), before tax | 0 | 0 |
Income tax expense related to items of other comprehensive income | 0 | 0 |
Other comprehensive income (loss) | 0 | 0 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (4,828) | (4,710) |
Noncontrolling interests | 0 | 0 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (4,828) | (4,710) |
Subsidiary Non- Guarantors | ||
Condensed Consolidating Statement of Comprehensive Income Information | ||
Net loss | (360) | (72) |
Other comprehensive income: | ||
Currency translation adjustment | 3 | (113) |
Other comprehensive income (loss), before tax | 3 | (113) |
Income tax expense related to items of other comprehensive income | (1) | 40 |
Other comprehensive income (loss) | 2 | (73) |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (358) | (145) |
Noncontrolling interests | (187) | (431) |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | (545) | (576) |
Eliminations | ||
Condensed Consolidating Statement of Comprehensive Income Information | ||
Net loss | 20,134 | 20,047 |
Other comprehensive income: | ||
Currency translation adjustment | (6) | 226 |
Other comprehensive income (loss), before tax | (6) | 226 |
Income tax expense related to items of other comprehensive income | 2 | (80) |
Other comprehensive income (loss) | (4) | 146 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | 20,130 | 20,193 |
Noncontrolling interests | 0 | 0 |
Comprehensive loss attributable to Delta Tucker Holdings, Inc. | $ 20,130 | $ 20,193 |
Consolidating Financial State60
Consolidating Financial Statements of Subsidiary Guarantors (Details 2) - USD ($) $ in Thousands | Mar. 25, 2016 | Dec. 31, 2015 | Mar. 27, 2015 | Dec. 31, 2014 |
Current assets: | ||||
Cash and cash equivalents | $ 74,787 | $ 108,782 | $ 59,847 | $ 94,004 |
Restricted cash | 721 | 721 | ||
Accounts receivable, net | 381,632 | 386,097 | ||
Intercompany receivables | 0 | 0 | ||
Prepaid expenses and other current assets | 50,973 | 55,683 | ||
Assets held for sale | 6,155 | 7,913 | ||
Total current assets | 514,268 | 559,196 | ||
Long-term restricted cash | 0 | |||
Property and equipment, net | 15,688 | 15,694 | ||
Goodwill | 42,093 | 42,093 | ||
Tradenames, net | 28,536 | 28,536 | ||
Other intangibles, net | 107,211 | 113,479 | ||
Investment in subsidiaries | 0 | 0 | ||
Long-term deferred taxes | 0 | 13,364 | ||
Other assets, net | 15,756 | 12,327 | ||
Total assets | 723,552 | 784,689 | ||
Current liabilities: | ||||
Current portion of long-term debt | 185,948 | 184,866 | ||
Accounts payable | 87,475 | 90,610 | ||
Accrued payroll and employee costs | 97,572 | 100,681 | ||
Intercompany payables | 0 | |||
Deferred income taxes | 0 | 27,334 | ||
Accrued liabilities | 83,765 | 114,718 | ||
Liabilities held for sale | 426 | 784 | ||
Income taxes payable | 10,042 | 8,130 | ||
Total current liabilities | 465,228 | 527,123 | ||
Long-term debt | 452,605 | 452,165 | ||
Long-term deferred taxes | 16,495 | 0 | ||
Other long-term liabilities | 12,351 | 13,571 | ||
Noncontrolling interests | 5,373 | 5,792 | ||
(Deficit) Equity | (228,500) | (213,962) | ||
Total liabilities and deficit | 723,552 | 784,689 | ||
Parent | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Restricted cash | 0 | 0 | ||
Accounts receivable, net | 0 | 0 | ||
Intercompany receivables | 0 | 0 | ||
Prepaid expenses and other current assets | 0 | 0 | ||
Assets held for sale | 0 | |||
Total current assets | 0 | 0 | ||
Long-term restricted cash | 0 | |||
Property and equipment, net | 0 | 0 | ||
Goodwill | 0 | 0 | ||
Tradenames, net | 0 | 0 | ||
Other intangibles, net | 0 | 0 | ||
Investment in subsidiaries | 0 | 0 | ||
Long-term deferred taxes | 0 | 0 | ||
Other assets, net | 0 | 0 | ||
Total assets | 0 | 0 | ||
Current liabilities: | ||||
Current portion of long-term debt | 0 | 0 | ||
Accounts payable | 0 | 0 | ||
Accrued payroll and employee costs | 0 | 0 | ||
Intercompany payables | 43,883 | 45,079 | ||
Deferred income taxes | 0 | |||
Accrued liabilities | 183,422 | 168,883 | ||
Liabilities held for sale | 0 | 0 | ||
Income taxes payable | 0 | 0 | ||
Total current liabilities | 227,305 | 213,962 | ||
Long-term debt | 0 | 0 | ||
Long-term deferred taxes | 1,196 | |||
Other long-term liabilities | 0 | 0 | ||
Noncontrolling interests | 0 | 0 | ||
(Deficit) Equity | (228,501) | (213,962) | ||
Total liabilities and deficit | 0 | 0 | ||
Subsidiary Issuer | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Restricted cash | 0 | 0 | ||
Accounts receivable, net | 0 | 0 | ||
Intercompany receivables | 0 | 0 | ||
Prepaid expenses and other current assets | 0 | 0 | ||
Assets held for sale | 0 | |||
Total current assets | 0 | 0 | ||
Long-term restricted cash | 0 | |||
Property and equipment, net | 0 | 0 | ||
Goodwill | 0 | 0 | ||
Tradenames, net | 0 | 0 | ||
Other intangibles, net | 0 | 0 | ||
Investment in subsidiaries | 630,287 | 650,005 | ||
Long-term deferred taxes | 0 | 0 | ||
Other assets, net | 0 | 0 | ||
Total assets | 630,287 | 650,005 | ||
Current liabilities: | ||||
Current portion of long-term debt | 185,948 | 184,866 | ||
Accounts payable | 0 | 0 | ||
Accrued payroll and employee costs | 0 | 0 | ||
Intercompany payables | 152,949 | 154,285 | ||
Deferred income taxes | 0 | |||
Accrued liabilities | 22,206 | 27,572 | ||
Liabilities held for sale | 0 | 0 | ||
Income taxes payable | 0 | 0 | ||
Total current liabilities | 361,103 | 366,723 | ||
Long-term debt | 452,605 | 452,165 | ||
Long-term deferred taxes | 0 | |||
Other long-term liabilities | 0 | 0 | ||
Noncontrolling interests | 0 | 0 | ||
(Deficit) Equity | (183,421) | (168,883) | ||
Total liabilities and deficit | 630,287 | 650,005 | ||
Subsidiary Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 57,491 | 95,365 | 48,358 | 87,300 |
Restricted cash | 721 | 721 | ||
Accounts receivable, net | 390,613 | 389,773 | ||
Intercompany receivables | 196,832 | 199,364 | ||
Prepaid expenses and other current assets | 49,139 | 54,364 | ||
Assets held for sale | 6,155 | 7,913 | ||
Total current assets | 700,951 | 747,500 | ||
Long-term restricted cash | 0 | |||
Property and equipment, net | 14,632 | 14,617 | ||
Goodwill | 9,694 | 9,694 | ||
Tradenames, net | 28,536 | 28,536 | ||
Other intangibles, net | 107,089 | 113,256 | ||
Investment in subsidiaries | 54,497 | 55,460 | ||
Long-term deferred taxes | 0 | 13,364 | ||
Other assets, net | 12,820 | 10,616 | ||
Total assets | 928,219 | 993,043 | ||
Current liabilities: | ||||
Current portion of long-term debt | 0 | 0 | ||
Accounts payable | 87,054 | 85,374 | ||
Accrued payroll and employee costs | 94,531 | 96,800 | ||
Intercompany payables | 4,464 | 15,180 | ||
Deferred income taxes | (25) | 27,310 | ||
Accrued liabilities | 68,401 | 90,013 | ||
Liabilities held for sale | 426 | 784 | ||
Income taxes payable | 10,058 | 8,214 | ||
Total current liabilities | 264,909 | 323,675 | ||
Long-term debt | 0 | 0 | ||
Long-term deferred taxes | 15,299 | |||
Other long-term liabilities | 12,351 | 13,571 | ||
Noncontrolling interests | 5,373 | 5,792 | ||
(Deficit) Equity | 630,287 | 650,005 | ||
Total liabilities and deficit | 928,219 | 993,043 | ||
Subsidiary Non- Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 17,296 | 13,417 | 11,489 | 6,704 |
Restricted cash | 0 | 0 | ||
Accounts receivable, net | 2,649 | 11 | ||
Intercompany receivables | 4,464 | 15,180 | ||
Prepaid expenses and other current assets | 2,228 | 1,825 | ||
Assets held for sale | 0 | |||
Total current assets | 26,637 | 30,433 | ||
Long-term restricted cash | 0 | |||
Property and equipment, net | 1,056 | 1,077 | ||
Goodwill | 32,399 | 32,399 | ||
Tradenames, net | 0 | 0 | ||
Other intangibles, net | 122 | 223 | ||
Investment in subsidiaries | 0 | 0 | ||
Long-term deferred taxes | 0 | 0 | ||
Other assets, net | 2,936 | 1,711 | ||
Total assets | 63,150 | 65,843 | ||
Current liabilities: | ||||
Current portion of long-term debt | 0 | 0 | ||
Accounts payable | 1,962 | 6,138 | ||
Accrued payroll and employee costs | 3,041 | 3,881 | ||
Intercompany payables | 0 | |||
Deferred income taxes | 25 | 24 | ||
Accrued liabilities | 3,625 | 340 | ||
Liabilities held for sale | 0 | 0 | ||
Income taxes payable | 0 | 0 | ||
Total current liabilities | 8,653 | 10,383 | ||
Long-term debt | 0 | 0 | ||
Long-term deferred taxes | 0 | |||
Other long-term liabilities | 0 | 0 | ||
Noncontrolling interests | 0 | 0 | ||
(Deficit) Equity | 54,497 | 55,460 | ||
Total liabilities and deficit | 63,150 | 65,843 | ||
Eliminations | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | $ 0 | $ 0 |
Restricted cash | 0 | 0 | ||
Accounts receivable, net | (11,630) | (3,687) | ||
Intercompany receivables | (201,296) | (214,544) | ||
Prepaid expenses and other current assets | (394) | (506) | ||
Assets held for sale | 0 | |||
Total current assets | (213,320) | (218,737) | ||
Long-term restricted cash | 0 | |||
Property and equipment, net | 0 | 0 | ||
Goodwill | 0 | 0 | ||
Tradenames, net | 0 | 0 | ||
Other intangibles, net | 0 | 0 | ||
Investment in subsidiaries | (684,784) | (705,465) | ||
Long-term deferred taxes | 0 | 0 | ||
Other assets, net | 0 | 0 | ||
Total assets | (898,104) | (924,202) | ||
Current liabilities: | ||||
Current portion of long-term debt | 0 | 0 | ||
Accounts payable | (1,541) | (902) | ||
Accrued payroll and employee costs | 0 | 0 | ||
Intercompany payables | (201,296) | (214,544) | ||
Deferred income taxes | 0 | |||
Accrued liabilities | (193,889) | (172,090) | ||
Liabilities held for sale | 0 | 0 | ||
Income taxes payable | (16) | (84) | ||
Total current liabilities | (396,742) | (387,620) | ||
Long-term debt | 0 | 0 | ||
Long-term deferred taxes | 0 | |||
Other long-term liabilities | 0 | 0 | ||
Noncontrolling interests | 0 | 0 | ||
(Deficit) Equity | (501,362) | (536,582) | ||
Total liabilities and deficit | $ (898,104) | $ (924,202) |
Consolidating Financial State61
Consolidating Financial Statements of Subsidiary Guarantors (Details 3) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 25, 2016 | Mar. 27, 2015 | Mar. 25, 2016 | Mar. 27, 2015 | |
Condensed Financial Statements, Captions [Line Items] | ||||
Net cash provided by (used in) operating activities | $ (30,543) | $ (33,563) | ||
Cash flows from investing activities: | ||||
Purchase of property and equipment, net | (812) | (173) | ||
Purchase of software | (1,261) | (417) | ||
Return of capital from equity method investees | 0 | 1,822 | ||
Contributions to equity method investees | (1,225) | (500) | ||
Transfers from (to) affiliates | 0 | 0 | ||
Net cash (used in) provided by investing activities | (3,298) | 732 | ||
Cash flows from financing activities: | ||||
Borrowings on indebtedness | 0 | 34,900 | ||
Payments on indebtedness | 0 | (34,900) | ||
Payments under other financing arrangements | 0 | (1,023) | ||
Equity contribution from affiliates of Cerberus | 250 | 0 | ||
Payments of dividends to Parent | (404) | (303) | ||
Transfers (to) from affiliates | 0 | 0 | ||
Net cash used in financing activities | (154) | (1,326) | ||
Net decrease in cash and cash equivalents | (33,995) | (34,157) | ||
Cash and cash equivalents, beginning of period | 108,782 | 94,004 | ||
Cash and cash equivalents, end of period | 108,782 | 94,004 | $ 74,787 | $ 59,847 |
Parent | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Net cash provided by (used in) operating activities | 1,759 | 1,571 | ||
Cash flows from investing activities: | ||||
Purchase of property and equipment, net | 0 | 0 | ||
Purchase of software | 0 | 0 | ||
Return of capital from equity method investees | 0 | |||
Contributions to equity method investees | 0 | 0 | ||
Transfers from (to) affiliates | 0 | 0 | ||
Net cash (used in) provided by investing activities | 0 | 0 | ||
Cash flows from financing activities: | ||||
Borrowings on indebtedness | 0 | |||
Payments on indebtedness | 0 | |||
Payments under other financing arrangements | 0 | |||
Equity contribution from affiliates of Cerberus | 0 | |||
Payments of dividends to Parent | 0 | 0 | ||
Transfers (to) from affiliates | (1,759) | (1,571) | ||
Net cash used in financing activities | (1,759) | (1,571) | ||
Net decrease in cash and cash equivalents | 0 | 0 | ||
Cash and cash equivalents, beginning of period | 0 | 0 | ||
Cash and cash equivalents, end of period | 0 | 0 | 0 | 0 |
Subsidiary Issuer | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Net cash provided by (used in) operating activities | 35,267 | (2,592) | ||
Cash flows from investing activities: | ||||
Purchase of property and equipment, net | 0 | 0 | ||
Purchase of software | 0 | 0 | ||
Return of capital from equity method investees | 0 | |||
Contributions to equity method investees | 0 | 0 | ||
Transfers from (to) affiliates | 0 | 0 | ||
Net cash (used in) provided by investing activities | 0 | 0 | ||
Cash flows from financing activities: | ||||
Borrowings on indebtedness | 34,900 | |||
Payments on indebtedness | (34,900) | |||
Payments under other financing arrangements | 0 | |||
Equity contribution from affiliates of Cerberus | 250 | |||
Payments of dividends to Parent | 0 | 0 | ||
Transfers (to) from affiliates | (35,517) | 2,592 | ||
Net cash used in financing activities | (35,267) | 2,592 | ||
Net decrease in cash and cash equivalents | 0 | 0 | ||
Cash and cash equivalents, beginning of period | 0 | 0 | ||
Cash and cash equivalents, end of period | 0 | 0 | 0 | 0 |
Subsidiary Guarantors | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Net cash provided by (used in) operating activities | (48,110) | (20,968) | ||
Cash flows from investing activities: | ||||
Purchase of property and equipment, net | (788) | (173) | ||
Purchase of software | (1,261) | (417) | ||
Return of capital from equity method investees | 1,822 | |||
Contributions to equity method investees | (1,225) | (500) | ||
Transfers from (to) affiliates | 37,277 | (1,021) | ||
Net cash (used in) provided by investing activities | 34,003 | (289) | ||
Cash flows from financing activities: | ||||
Borrowings on indebtedness | 0 | |||
Payments on indebtedness | 0 | |||
Payments under other financing arrangements | (1,023) | |||
Equity contribution from affiliates of Cerberus | 0 | |||
Payments of dividends to Parent | 0 | 0 | ||
Transfers (to) from affiliates | (23,767) | (16,662) | ||
Net cash used in financing activities | (23,767) | (17,685) | ||
Net decrease in cash and cash equivalents | (37,874) | (38,942) | ||
Cash and cash equivalents, beginning of period | 95,365 | 87,300 | ||
Cash and cash equivalents, end of period | 95,365 | 87,300 | 57,491 | 48,358 |
Subsidiary Non- Guarantors | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Net cash provided by (used in) operating activities | (19,056) | (11,473) | ||
Cash flows from investing activities: | ||||
Purchase of property and equipment, net | (24) | 0 | ||
Purchase of software | 0 | 0 | ||
Return of capital from equity method investees | 0 | |||
Contributions to equity method investees | 0 | 0 | ||
Transfers from (to) affiliates | 23,767 | 16,662 | ||
Net cash (used in) provided by investing activities | 23,743 | 16,662 | ||
Cash flows from financing activities: | ||||
Borrowings on indebtedness | 0 | |||
Payments on indebtedness | 0 | |||
Payments under other financing arrangements | 0 | |||
Equity contribution from affiliates of Cerberus | 0 | |||
Payments of dividends to Parent | (808) | (404) | ||
Transfers (to) from affiliates | 0 | 0 | ||
Net cash used in financing activities | (808) | (404) | ||
Net decrease in cash and cash equivalents | 3,879 | 4,785 | ||
Cash and cash equivalents, beginning of period | 13,417 | 6,704 | ||
Cash and cash equivalents, end of period | 13,417 | 6,704 | 17,296 | 11,489 |
Eliminations | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Net cash provided by (used in) operating activities | (403) | (101) | ||
Cash flows from investing activities: | ||||
Purchase of property and equipment, net | 0 | 0 | ||
Purchase of software | 0 | 0 | ||
Return of capital from equity method investees | 0 | |||
Contributions to equity method investees | 0 | 0 | ||
Transfers from (to) affiliates | (61,044) | (15,641) | ||
Net cash (used in) provided by investing activities | (61,044) | (15,641) | ||
Cash flows from financing activities: | ||||
Borrowings on indebtedness | 0 | |||
Payments on indebtedness | 0 | |||
Payments under other financing arrangements | 0 | |||
Equity contribution from affiliates of Cerberus | 0 | |||
Payments of dividends to Parent | 404 | 101 | ||
Transfers (to) from affiliates | 61,043 | 15,641 | ||
Net cash used in financing activities | 61,447 | 15,742 | ||
Net decrease in cash and cash equivalents | 0 | 0 | ||
Cash and cash equivalents, beginning of period | 0 | 0 | ||
Cash and cash equivalents, end of period | $ 0 | $ 0 | $ 0 | $ 0 |
Consolidating Financial State62
Consolidating Financial Statements of Subsidiary Guarantors (Details Textual) | Mar. 25, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Percentage of ownership | 100.00% |