Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 22, 2019 | Jun. 29, 2018 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | FTS International, Inc. | ||
Entity Central Index Key | 1,529,463 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Public Float | $ 468.2 | ||
Entity Common Stock, Shares Outstanding | 109,794,386 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | 36 Months Ended | ||||||||||
Jan. 31, 2017 | Jan. 31, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | |
Revenue | ||||||||||||||
Revenue | $ 248.1 | $ 324.4 | $ 454.6 | $ 423.3 | $ 446.6 | $ 409.8 | $ 304.4 | $ 191.9 | $ 1,450.4 | $ 1,352.7 | $ 529.5 | |||
Revenue from related parties | 10 | 38.7 | 44.2 | 12.1 | 39.2 | 40.5 | 21.6 | 92.9 | 113.4 | 2.7 | ||||
Total revenue | 248.1 | 334.4 | 493.3 | 467.5 | 458.7 | 449 | 344.9 | 213.5 | 1,543.3 | 1,466.1 | 532.2 | |||
Operating expenses | ||||||||||||||
Costs of revenue (excluding depreciation of $75.9, $75.6 and $98.9, respectively, included in depreciation and amortization below) | 169.4 | 222.2 | 329.4 | 312.2 | 299.9 | 298.8 | 236.3 | 174.8 | 1,033.2 | 1,009.8 | 510.5 | |||
Selling, general and administrative | 21.6 | 19.7 | 20.8 | 25.8 | 19 | 21.7 | 20.8 | 19.5 | 87.9 | 81 | 64.4 | |||
Depreciation and amortization | 22.3 | 21.1 | 20.7 | 20.6 | 21.4 | 22.1 | 21.3 | 21.8 | 84.7 | 86.6 | 112.6 | |||
Impairments and other charges | 3.2 | 10 | 4 | 2 | 0.4 | 0.1 | 1.2 | 0.1 | 19.2 | 1.8 | 12.3 | |||
(Gain) loss on disposal of assets, net | (0.3) | (0.1) | (0.2) | 0.5 | 0.2 | (0.8) | (0.4) | (0.4) | (0.1) | (1.4) | 1 | |||
Gain on insurance recoveries | $ (2.9) | $ (15.1) | (0.3) | (2.6) | (2.9) | (15.1) | ||||||||
Total operating expenses | 216.2 | 272.9 | 374.7 | 361.1 | 340.9 | 341.9 | 278.9 | 213.2 | 1,224.9 | 1,174.9 | 685.7 | |||
Operating income (loss) | 31.9 | 61.5 | 118.6 | 106.4 | 117.8 | 107.1 | 66 | 0.3 | 318.4 | 291.2 | (153.5) | |||
Interest expense, net | (9.4) | (10.4) | (12.1) | (17.4) | (21.9) | (22.1) | (21.5) | (21.2) | (49.3) | (86.7) | (87.5) | |||
(Loss) gain on extinguishment of debt, net | 0.9 | (0.6) | (0.8) | (9.3) | (1.4) | (9.8) | (1.4) | 53.7 | ||||||
Equity in net income (loss) of joint venture affiliate | 3 | (0.7) | (1.2) | (0.9) | (1) | 0.2 | 0.9 | 1.1 | (0.8) | (2.8) | ||||
Income (loss) before income taxes | 26.4 | 49.8 | 104.5 | 79.7 | 93.6 | 84 | 44.7 | (20) | 260.4 | 202.3 | (190.1) | $ 272.6 | ||
Income tax expense (benefit) | (0.1) | 0.2 | 0.9 | 1 | 0.7 | 0.4 | 0.4 | 0.1 | 2 | 1.6 | (1.6) | |||
Net income (loss) | 26.5 | 49.6 | 103.6 | 78.7 | 92.9 | 83.6 | 44.3 | (20.1) | 258.4 | 200.7 | (188.5) | |||
Net income (loss) attributable to common stockholders | $ 26.5 | $ 49.6 | $ 103.6 | $ 501.9 | $ 30.9 | $ 25.1 | $ (10.5) | $ (71.4) | $ 681.6 | $ (25.9) | $ (370.1) | |||
Basic and diluted earnings (loss) per share attributable to common stockholders | $ 0.24 | $ 0.45 | $ 0.95 | $ 5.68 | $ 0.60 | $ 0.48 | $ (0.20) | $ (1.38) | $ 6.54 | $ (0.50) | $ (7.14) | |||
Shares used in computing basic and diluted earnings (loss) per share | 109.4 | 109.3 | 109.3 | 88.4 | 51.8 | 51.8 | 51.8 | 51.8 | 104.2 | 51.8 | 51.8 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Depreciation | |||
Depreciation | $ 75.9 | $ 75.6 | $ 98.9 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 177.8 | $ 208.1 |
Accounts receivable, net | 158.3 | 231.1 |
Accounts receivable from related parties | 3 | |
Inventories | 66.6 | 44.5 |
Prepaid expenses and other current assets | 7 | 19.9 |
Total current assets | 409.7 | 506.6 |
Property, plant, and equipment, net | 275.3 | 270.9 |
Intangible assets, net | 29.5 | 29.5 |
Investment in joint venture affiliate | 23.2 | 21 |
Other assets | 6 | 3 |
Total assets | 743.7 | 831 |
Current liabilities | ||
Accounts payable | 101.1 | 138.3 |
Accrued expenses and other current liabilities | 31.3 | 44.4 |
Total current liabilities | 132.4 | 182.7 |
Long-term debt | 503.2 | 1,116.4 |
Other liabilities | 1.2 | 0.4 |
Total liabilities | 636.8 | 1,299.5 |
Commitments and contingencies (Note 13) | ||
Series A convertible preferred stock, $0.01 par value, 350,000 shares authorized, issued and outstanding at December 31, 2017 | 349.8 | |
Stockholders’ equity (deficit) | ||
Preferred stock, $0.01 par value, 25,000,000 shares authorized at December 31, 2018 | ||
Common stock, $0.01 par value, 320,000,000 shares authorized, 109,434,841 shares issued and outstanding at December 31, 2018 and 51,782,735 shares issued and outstanding at December 31, 2017 | 36.4 | 35.9 |
Additional paid-in capital | 4,378.4 | 3,712.1 |
Accumulated deficit | (4,307.9) | (4,566.3) |
Total stockholders’ equity (deficit) | 106.9 | (818.3) |
Total liabilities and stockholders’ equity (deficit) | $ 743.7 | $ 831 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Temporary equity | ||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | |
Convertible preferred stock, authorized (in shares) | 350,000 | |
Convertible preferred stock, issued (in shares) | 350,000 | |
Convertible preferred stock, outstanding (in shares) | 350,000 | |
Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | |
Preferred stock, authorized (in shares) | 25,000,000 | |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 320,000,000 | 320,000,000 |
Common stock, issued (in shares) | 109,434,841 | 51,782,735 |
Common stock, outstanding (in shares) | 109,434,841 | 51,782,735 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities | |||
Net income (loss) | $ 258.4 | $ 200.7 | $ (188.5) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 84.7 | 86.6 | 112.6 |
Stock-based compensation | 15.2 | ||
Amortization of debt discounts and issuance costs | 2.5 | 3.9 | 3.8 |
Impairment of assets | 7 | ||
(Gain) loss on disposal of assets, net | (0.1) | (1.4) | 1 |
Loss (gain) on extinguishment of debt, net | 9.8 | 1.4 | (53.7) |
Gain on insurance recoveries | (2.9) | (15.1) | |
Other non-cash items | (1.6) | 0.5 | 2 |
Changes in operating assets and liabilities: | |||
Accounts receivable | 72.7 | (154.9) | 24 |
Accounts receivable from related parties | 3 | (2.9) | 3.4 |
Inventories | (22.6) | (20.1) | 5.3 |
Prepaid expenses and other assets | 2.8 | (4.4) | 2.6 |
Accounts payable | (27.7) | 65.2 | 2.8 |
Accrued expenses and other liabilities | (12.3) | 8.3 | (17) |
Net cash provided by (used in) operating activities | 384.8 | 180 | (109.8) |
Cash flows from investing activities | |||
Capital expenditures | (100.5) | (64) | (10.3) |
Proceeds from disposal of assets | 1.9 | 4.1 | 31.5 |
Proceeds from insurance recoveries | 4.2 | 19 | |
Other | 1.1 | ||
Net cash (used in) provided by investing activities | (98.6) | (54.6) | 40.2 |
Cash flows from financing activities | |||
Repayments of long-term debt | (625.1) | (77.6) | (37.6) |
Net proceeds from issuance of common stock | 303 | ||
Payments of revolving credit facility issuance costs | (2.4) | ||
Taxes paid related to net share settlement of equity awards | (1.1) | ||
Net cash used in financing activities | (325.6) | (77.6) | (37.6) |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (39.4) | 47.8 | (107.2) |
Cash, cash equivalents, and restricted cash at beginning of period | 217.2 | 169.4 | 276.6 |
Cash, cash equivalents, and restricted cash at end of period | 177.8 | 217.2 | 169.4 |
Supplemental cash flow information: | |||
Interest paid | 43.1 | 83.2 | 84.2 |
Income tax payments, net | 2.3 | ||
Supplemental disclosure of noncash investing activities: | |||
Capital expenditures included in accounts payable | $ 4 | $ 13.6 | $ 1.2 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Millions | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at beginning of period at Dec. 31, 2015 | $ 35.9 | $ 3,712.1 | $ (4,578.5) | $ (830.5) |
Balance at beginning of period (in shares) at Dec. 31, 2015 | 51,784,000 | |||
Net income (loss) | (188.5) | (188.5) | ||
Activity related to stock plans (in shares) | (1,000) | |||
Balance at end of period at Dec. 31, 2016 | $ 35.9 | 3,712.1 | (4,767) | (1,019) |
Balance at end of period (in shares) at Dec. 31, 2016 | 51,783,000 | |||
Net income (loss) | 200.7 | 200.7 | ||
Balance at end of period at Dec. 31, 2017 | $ 35.9 | 3,712.1 | (4,566.3) | $ (818.3) |
Balance at end of period (in shares) at Dec. 31, 2017 | 51,783,000 | 51,782,735 | ||
Net income (loss) | 258.4 | $ 258.4 | ||
Activity related to stock plans | 14 | 14 | ||
Activity related to stock plans (in shares) | 160,000 | |||
Recapitalization of convertible preferred stock to common stock | $ 0.4 | 349.4 | 349.8 | |
Recapitalization of convertible preferred stock to common stock (in shares) | 39,415,000 | |||
Issuance of common stock | $ 0.1 | 302.9 | 303 | |
Issuance of common stock (in shares) | 18,077,000 | |||
Balance at end of period at Dec. 31, 2018 | $ 36.4 | $ 4,378.4 | $ (4,307.9) | $ 106.9 |
Balance at end of period (in shares) at Dec. 31, 2018 | 109,435,000 | 109,434,841 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
DESCRIPTION OF BUSINESS | NOTE 1 — DESCRIPTION OF BUSINESS Throughout the notes to these consolidated financial statements, the terms “the Company,” “we,” “us,” “our” or “ours” refer to FTS International, Inc., together with its consolidated subsidiaries. We are one of the largest providers of hydraulic fracturing services in North America. Our services enhance hydrocarbon flow from oil and natural gas wells drilled by exploration and production (“E&P”), companies in shale and other unconventional resource formations. Our customers include leading E&P companies that specialize in unconventional oil and natural gas resources in North America. We operate in five of the most active major unconventional basins in the United States: the Permian Basin, the SCOOP/STACK Formation, the Marcellus/Utica Shale, the Eagle Ford Shale and the Haynesville Shale. Substantially all of our business activities support our well completion services. We manage our business, allocate resources, and assess our financial performance on a consolidated basis; therefore we do not have separate operating segments. In 2014, we entered into a joint venture agreement with the Sinopec Oilfield Service Corporation (“Sinopec”). This joint venture collaboration offers hydraulic stimulation services in China. The joint venture company, SinoFTS Petroleum Services Ltd. (“SinoFTS”), is owned 55% by Sinopec and 45% by the Company. SinoFTS serves both Sinopec and other exploration and production companies in China. On January 9, 2019, we filed an arbitration proceeding with the Singapore International Arbitration Centre to resolve a dispute related to the manner of operations by our JV partner. Recent Developments : In February 2018, the Company completed an initial public offering of its common stock and completed a number of other transactions. See Note 5 — “Stockholders’ Equity (Deficit)” for more information. Concentrations of Risk Our business activities are concentrated in the well completion services segment of the oilfield services industry in the United States. The market for these services is cyclical, and we depend on the willingness of our customers to make operating and capital expenditures to explore for, develop, and produce oil and natural gas in the United States. The willingness of our customers to undertake these activities depends largely upon prevailing industry conditions that are predominantly influenced by current and expected prices for oil and natural gas. Historically, a low commodity-price environment has caused our customers to significantly reduce their hydraulic fracturing activities and the prices they are willing to pay for those services. During these periods, these customer actions materially adversely affected our business, financial condition and results of operations. Our customer base has historically been concentrated. Our business, financial condition and results of operations could be materially adversely affected if one or more of our significant customers ceases to engage us for our services on favorable terms, or at all, or fails to pay, or delays in paying, us significant amounts of our outstanding receivables. The following table shows the customers who represented more than 10% of our total revenue in any one of the periods indicated below: Year Ended December 31, 2018 2017 2016 EQT Production Company 12 % * 12 % Devon Energy Corporation 12 % * * Newfield Exploration * * 18 % EP Energy Corporation * * 11 % Vine Oil and Gas, L.P. * * 10 % * Related Parties We have historically provided services and sold equipment to Chesapeake Energy Corporation and its affiliates (“Chesapeake”), which beneficially owned approximately 20% of our outstanding common stock as of December 31, 2018, and had the right to designate two individuals to serve on our board of directors during the periods presented. Revenue earned from Chesapeake was $92.9 million, $113.1 million and $2.4 million in 2018, 2017 and 2016, respectively. All revenue earned from Chesapeake is based on the prevailing market prices for our services at the time the work is performed. At December 31, 2018 and 2017, we had accounts receivable balances of zero and $2.7 million, respectively, from Chesapeake. We sold equipment to SinoFTS for $0.3 million and $0.3 million in 2017 and 2016, respectively. All revenue earned from SinoFTS is based on prevailing market prices. At December 31, 2018 and 2017, we had accounts receivable balances of zero and $0.3 million, respectively, from this related party. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation We prepared the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of the Company and all majority-owned domestic and foreign subsidiaries. Investments over which we have the ability to exercise significant influence over operating and financial policies, but do not hold a controlling interest, are accounted for using the equity method of accounting. All significant intercompany accounts and transactions have been eliminated in consolidation. There were no items of other comprehensive income in the periods presented. Use of Estimates The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, related revenues and expenses, and the disclosure of gain and loss contingencies at the date of the financial statements and during the periods presented. We base these estimates on historical results and various other assumptions believed to be reasonable, all of which form the basis for making estimates concerning the carrying values of assets and liabilities that are not readily available from other sources. Actual results could differ materially from those estimates. Cash and Cash Equivalents Cash equivalents include only investments with an original maturity of three months or less. We occasionally hold cash deposits in financial institutions that exceed federally insured limits. We monitor the credit ratings and our concentration of risk with these financial institutions on a continuing basis to safeguard our cash deposits. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at their invoiced amounts or amounts for which we have a right to invoice based on services completed. We establish an allowance for doubtful accounts to reduce the carrying value of our accounts receivable based on a number of factors, including the length of time that accounts receivable are past due, our previous loss history, and the customer’s creditworthiness. The provision for doubtful accounts was not significant for any period presented in the Consolidated Statements of Operations. Inventories Inventories consist of proppants and chemicals that are used to provide hydraulic fracturing services, maintenance parts that are used to service our hydraulic fracturing equipment, and explosives and perforating guns that are used to provide our wireline services. Proppants generally consist of raw sand, resin-coated sand or ceramic particles. Inventories are stated at the lower of cost or market value. The cost basis of our inventories is based on the average cost method and includes in-bound freight costs. As necessary, we record an adjustment to decrease the value of slow moving and obsolete inventory to its net realizable value. To determine the adjustment amount, we regularly review inventory quantities on hand and compare them to estimates of future product demand, market conditions, production requirements and technological developments. Restricted Cash We have pledged cash as collateral for letters of credit issued to our casualty and general liability insurance provider. Restricted cash totaled zero and $9.1 million at December 31, 2018 and 2017, respectively, and is included in prepaid expenses and other current assets in our Consolidated Balance Sheets. These amounts represent cash used to secure certain letters of credit. In February 2018, we closed on a new revolving credit facility, and issued replacement letters of credit under the new facility, which allowed us to cancel the cash secured letters of credit. Property, Plant, and Equipment Property, plant, and equipment is stated at cost less accumulated depreciation, which is generally provided by using the straight-line method over the estimated useful lives of the individual assets. We manufacture our hydraulic fracturing units and the cost of this equipment, which includes direct and indirect manufacturing costs, is capitalized and carried as construction-in-progress until it is completed. Expenditures for renewals and betterments that extend the lives of our service equipment, which includes the replacement of significant components of service equipment, are capitalized and depreciated. Other repairs and maintenance costs are expensed as incurred. We capitalize qualifying costs related to the acquisition or development of internal-use software. Capitalization of costs begins after the conceptual formulation stage has been completed. Capitalized costs are amortized over the estimated useful life of the software, which ranges between three and five years. The unamortized balance of capitalized software costs at December 31, 2018 and 2017, was $3.7 million and $7.5 million, respectively. Amortization of computer software was $4.2 million, $5.3 million and $5.7 million in 2018, 2017 and 2016, respectively. Goodwill and Intangible Assets We have historically acquired goodwill and indefinite-lived intangible assets related to business acquisitions. Goodwill is the amount by which the consideration transferred to acquire a business exceeds the fair value of the underlying individual assets and liabilities of that business. Goodwill and intangible assets with indefinite lives are not amortized. The amount of goodwill and indefinite-lived intangible assets recorded in our Consolidated Balance Sheets for the periods presented was zero and $29.5 million, respectively. Intangible assets with definite lives are amortized on a basis that reflects the pattern in which the economic benefits of the intangible assets are realized, which is generally on a straight-line basis over the asset’s estimated useful life. The amount of intangible assets with definite lives recorded in our Consolidated Balance Sheets for the periods presented was zero. Impairment of Long-Lived Assets, Goodwill and Other Intangible Assets Long-lived assets, such as property, plant, equipment and definite-lived intangible assets, are reviewed for impairment when events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Recoverability is assessed based on the undiscounted future cash flows generated by the asset or asset group. If the carrying amount of an asset or asset group is not recoverable, we recognize an impairment loss equal to the amount by which the carrying amount exceeds fair value. We estimate fair value based on the income, market, or cost valuation techniques. Goodwill and intangible assets with indefinite lives are reviewed at least annually for impairment, and in interim periods if certain events occur indicating that the carrying value of goodwill or intangible assets may be impaired. We estimate fair values utilizing valuation methods such as discounted cash flows and comparable market valuations. We perform our annual impairment tests at the beginning of the fourth quarter. Equity Method Investments Investments in which we have the ability to exercise significant influence, but not control, are accounted for pursuant to the equity method of accounting. We recognize our proportionate share of earnings or losses of our international affiliates three months after they occur. When events and circumstances warrant, investments accounted for under the equity method of accounting are evaluated for impairment. An impairment charge is recorded whenever a decline in value of an investment below its carrying amount is determined to be other-than-temporary. Income Taxes Income taxes are accounted for using the asset and liability method. Deferred taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The effect on deferred taxes for a change in tax rates is recognized in earnings in the period that includes the enactment date. We recognize future tax benefits to the extent that such benefits are more likely than not to be realized. We record a valuation allowance to reduce the value of a deferred tax asset if based on the consideration of all available evidence, it is more likely than not that all or some portion of the deferred tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. We evaluate our deferred income taxes quarterly to determine if a valuation allowance is required by considering all available evidence, including historical and projected taxable income and tax planning strategies. Any deferred tax asset subject to a valuation allowance is still available to us to offset future taxable income, subject to annual limitations in the event of an “ownership change” under Section 382 of the Internal Revenue Code. We will adjust a previously established valuation allowance if we change our assessment of the amount of deferred income tax asset that is more likely than not to be realized. Revenue Recognition The Company contracts with its customers to perform hydraulic fracturing services on one or more oil or natural gas wells. Under these arrangements, we satisfy our performance obligations as services are rendered, which is generally upon the completion of a fracturing stage. We typically complete one or more stages per day. A stage is considered complete when we have met the specifications set forth by the customer, at which time we have the right to invoice the customer and the customer is obligated to pay us for the services rendered. The price for our services typically includes an equipment charge and product charges for proppant, chemicals and other products actually consumed during the course of providing our services. The price for each stage of a particular well does not vary significantly. Payment terms average approximately two months from the date a stage is completed. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. We also contract with some customers to provide them with the exclusive use of a fracturing fleet for a period of time. We satisfy our performance obligation as services are rendered, which is based on the passage of time rather than the completion of a stage. Under these arrangements, we have the right to receive consideration from a customer even if circumstances outside of our control prevent us from performing our work. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. Pricing for our services is frequently negotiated with our customers and is based on prevailing market rates during each reporting period. The amounts we invoice our customers for services performed during a period are directly related to the value received by the customers for the period. There is no inherent uncertainty to the amount of consideration we will receive for services performed during a period and no judgment is required to allocate a portion of the transaction price to a future period. Accordingly, we are not required to identify any unsatisfied performance obligations nor attribute any revenue to them. During 2018 we acted as a principal, rather than as an agent, for all of the goods and services that we provided to our customers; our customer arrangements did not include obligations for refunds or warranties of our work; and we did not incur incremental costs to obtain or fulfill contracts with our customers. To comply with the FASB disclosure objective, we are required to disaggregate our revenue into categories if it will provide an enhanced understanding of how the nature, amount, timing, and uncertainty of our revenue and cash flows are affected by economic factors. To evaluate an appropriate level of disaggregation of revenue, we considered the following aspects of our business: · We provide a single service to our customers. · We only generate revenue in the U.S. onshore market. · We have a homogeneous customer base, which is comprised of large oil and gas exploration companies. · We provide our service over a short period of time. · We do not disaggregate our revenue into categories for any external communications or to make resource allocation decisions. · We do not have separate operating segments. Based on the above factors, we concluded that no additional disaggregation of revenue was necessary or meaningful to help depict the nature, amount, timing and uncertainty of our revenues and cash flows. Unconditional Purchase Obligations We have historically entered into inventory supply arrangements with our vendors, primarily for sand, that contain unconditional purchase obligations. These represent obligations to transfer funds in the future for fixed or minimum quantities of goods or services at fixed or minimum prices. We enter into these unconditional purchase obligation arrangements in the normal course of business to ensure that adequate levels of sourced product are available to us. To account for these arrangements, we must monitor whether we may be required to make a minimum payment to a vendor in a future period because our projected inventory purchases may not satisfy our minimum commitments. If we conclude that it is probable that we will make a minimum payment under these arrangements, we will record an estimated loss for these commitments in the current period. Stock-Based Compensation We measure all employee stock-based compensation awards using a fair value method and record this cost in the consolidated financial statements. Our stock-based compensation relates to restricted stock units issued to our employees. On the date that an equity-classified award is granted, we determine the fair value of the award and recognize the compensation cost over the requisite service period, which typically is the period over which the award vests. For liability-classified awards, we determine the fair value of the award at each reporting date and recognize a portion of the fair value equal to the amount of time that has passed in the requisite service period. For equity-classified awards with graded vesting based solely on the satisfaction of a service condition, we recognize compensation cost as a single award on a straight-line basis. We account for forfeited awards as forfeitures occur, which results in a reversal of stock-based compensation cost previously recognized up to the date of the forfeiture. For stock-based awards with performance conditions that affect vesting, we only recognize compensation cost when it is probable that the performance conditions will be met. Fair Value Measurements Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at a measurement date. We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: · Level One: The use of quoted prices in active markets for identical financial instruments. · Level Two: The use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or other inputs that are observable in the market or can be corroborated by observable market data. · Level Three: The use of significant unobservable inputs that typically require the use of management’s estimates of assumptions that market participants would use in pricing. New Accounting Standards Updates In May 2014, the Financial Accounting Standards Board (“FASB”), issued Accounting Standards Update (“ASU”), 2014-09, Revenue from Contracts with Customers . The FASB subsequently issued a number of additional ASUs to update this guidance. This guidance superseded substantially all existing accounting guidance related to the accounting for revenue transactions. This guidance establishes a core principle that an entity should record revenue when it transfers control of goods or services to customers at an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. We adopted this standard on January 1, 2018. Our approach to adopting this standard included performing a review of key contracts and comparing historical accounting policies and practices to the new accounting guidance. The accounting for revenue under the new ASU is materially consistent with our previous revenue recognition process. These consolidated financial statements have been prepared in accordance with the new ASU utilizing the modified retrospective method, which did not require a cumulative effect of accounting change at January 1, 2018. In February 2016, the FASB issued ASU 2016-02, Leases . The FASB subsequently issued a number of additional ASUs to update this guidance. This standard was issued to increase transparency and comparability among organizations by requiring that a right-of-use asset and corresponding lease liability be recorded on the balance sheet for leases with terms longer than 12 months. This standard is effective for our financial statements beginning on January 1, 2019. We transitioned to the new guidance using the modified retrospective transition method on the adoption date and we will recognize a cumulative-effect adjustment to our retained earnings for this accounting change on January 1, 2019. We plan to elect three practical expedients allowed under the guidance. According to these practical expedients we will not reassess whether existing contracts are or contain a lease; we will not reassess whether existing leases are operating or finance leases; and we will not reassess the accounting for initial direct costs for existing leases. We are in the process of determining the effects that the new standard will have on our consolidated financial statements. Our approach includes a review of existing leases and other executory contracts that may contain embedded leases and identifying the key terms that will be necessary for us to calculate the right-of-use asset and lease liability. We currently estimate that the adoption of this standard will increase our total assets and liabilities by approximately $40 million. These estimates could change before the completion of our adoption of this new guidance. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments . This standard was issued to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. We adopted this standard on January 1, 2018, and it had no effect on our consolidated statements of cash flows. In November 2016, the FASB issued ASU 2016-18, Restricted Cash . This standard was issued to change the presentation of amounts generally described as restricted cash and restricted cash equivalents to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted this standard on January 1, 2018, and the effects of this standard and related required disclosures have been reflected in our condensed consolidated statements of cash flows. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated statements of cash flows: December 31, (In millions) 2017 2016 Cash and cash equivalents $ 208.1 $ 160.3 Restricted cash included in prepaid expenses and other current assets 9.1 9.1 Total cash, cash equivalents, and restricted cash shown in the $ 217.2 $ 169.4 As of December 31, 2017 and 2016, we had amounts included in restricted cash that represented amounts required to be set aside by contractual agreement with our casualty and general liability insurance provider and corporate credit card provider. In February 2018, these contractual agreements to set aside cash were terminated. Therefore, as of December 31, 2018, we had no restricted cash balance. As a result of our adoption of ASU 2016-18, we recasted certain balances in our consolidated statement of cash flows for 2017 and 2016. The following table reflects the recasted balances: Year Ended December 31, 2017 (In millions) As Reported Adjustments Recasted Net cash used in investing activities $ (54.6) $ — $ (54.6) Cash, cash equivalents, and restricted cash at beginning of period $ 160.3 $ 9.1 $ 169.4 Cash, cash equivalents, and restricted cash at end of period $ 208.1 $ 9.1 $ 217.2 Year Ended December 31, 2016 (In millions) As Reported Adjustments Recasted Net cash provided by investing activities $ 43.1 $ (2.9) $ 40.2 Cash, cash equivalents, and restricted cash at beginning of period $ 264.6 $ 12.0 $ 276.6 Cash, cash equivalents, and restricted cash at end of period $ 160.3 $ 9.1 $ 169.4 |
SUPPLEMENTAL BALANCE SHEET INFO
SUPPLEMENTAL BALANCE SHEET INFORMATION | 12 Months Ended |
Dec. 31, 2018 | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | NOTE 3 — SUPPLEMENTAL BALANCE SHEET INFORMATION Accounts Receivable The following table summarizes our accounts receivable balance: December 31, (In millions) 2018 2017 Trade accounts receivable $ 159.2 $ 233.2 Allowance for doubtful accounts (0.9) (2.1) Accounts receivable, net $ 158.3 $ 231.1 The change in allowance for doubtful accounts is as follows: (In millions) 2018 2017 2016 Balance at beginning of year $ 2.1 $ 2.3 $ 1.7 Provision for bad debts, net included in selling, general, — 0.3 1.3 Uncollectible receivables written off (1.2) (0.5) (0.7) Balance at end of year $ 0.9 $ 2.1 $ 2.3 Inventories The following table summarizes our inventories: December 31, (In millions) 2018 2017 Maintenance parts $ 60.3 $ 34.5 Proppants and chemicals 4.3 7.5 Other 2.0 2.5 Total inventories $ 66.6 $ 44.5 Prepaid Expenses and Other Current Assets The following table summarizes our prepaid expenses and other current assets: December 31, (In millions) 2018 2017 Restricted cash $ — $ 9.1 Prepaid expenses 5.8 7.1 Other 1.2 3.7 Total prepaid expenses and other current assets $ 7.0 $ 19.9 Property, Plant, and Equipment, net The following table summarizes our property, plant, and equipment: Estimated December 31, Useful Life (Dollars in millions) 2018 2017 (in years) Service equipment $ 780.5 $ 745.1 2.5 – 10 Buildings and improvements 63.1 63.1 15 – 39 Office, software, and other equipment 44.7 43.7 3 – 7 Vehicles and transportation equipment 9.2 13.6 5 – 20 Land 7.7 7.7 N/A Construction-in-process and other 32.4 35.3 N/A Total property, plant, and equipment 937.6 908.5 Accumulated depreciation and amortization (662.3) (637.6) Total property, plant, and equipment, net $ 275.3 $ 270.9 Depreciation expense was $84.7 million, $86.6 million and $112.6 million in 2018, 2017 and 2016, respectively. Accrued Expenses and Other Current Liabilities The following table summarizes our accrued liabilities: December 31, (In millions) 2018 2017 Sales, use, and property taxes $ 12.5 $ 19.3 Employee compensation and benefits 6.1 13.6 Interest 4.3 5.7 Insurance 4.3 3.3 Other 4.1 2.5 Total accrued expenses and other current liabilities $ 31.3 $ 44.4 |
INDEBTEDNESS AND BORROWING FACI
INDEBTEDNESS AND BORROWING FACILITY | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
INDEBTEDNESS AND BORROWING FACILITY | NOTE 4 — INDEBTEDNESS AND BORROWING FACILITY The following table summarizes our long-term debt: December 31, (In millions) 2018 2017 Senior floating rate notes due June 2020 $ — $ 290.0 Term loan due April 2021 121.0 431.0 Senior notes due May 2022 386.9 409.0 Total principal amount 507.9 1,130.0 Less unamortized discount and debt issuance costs (4.7) (13.6) Total long-term debt $ 503.2 $ 1,116.4 Estimated fair value of long-term debt $ 461.2 $ 1,113.8 Estimated fair values for our term loan and senior notes were determined using recent trading activity and/or bid-ask spreads and are classified as Level 2 in the FASB’s fair value hierarchy. 2020 Senior Floating Rate Notes On June 1, 2015, we completed an offering of $350 million of senior secured floating rate notes due June 15, 2020, in a private offering to qualified institutional buyers (“2020 Senior Notes”). The 2020 Senior Notes bore interest at a three-month London Interbank Offered Rate (“LIBOR”) plus a margin of 7.5% per annum. Interest was payable quarterly, in arrears, on March 15, June 15, September 15 and December 15. The 2020 Senior Notes were issued at a discount of $3.5 million for aggregate consideration of $346.5 million and resulted in net proceeds to the Company of $340.5 million after debt issuance costs of $6.0 million. The obligation to pay principal and interest on the 2020 Senior Notes was jointly and severally guaranteed on a full and unconditional basis by all of our wholly owned domestic subsidiaries. The 2020 Senior Notes were secured on a first priority basis by our accounts receivable, inventory, deposit accounts, and certain hydraulic fracturing and other equipment. The 2020 Senior Notes were secured on a second priority basis by 100% of the equity interests of our existing and future domestic subsidiaries and 65% of the voting equity interests of our existing and future foreign subsidiaries. The 2020 Senior Notes were redeemable, at our option, beginning on June 15, 2016, at a premium of 3%. The redemption premium then declined each year until June 15, 2018, at which time we could redeem the notes at par value. The 2020 Senior Notes contained covenants that could, in certain circumstances, limit our ability to issue additional debt, repurchase or pay dividends on our common or preferred stock, sell substantially all of our assets, make certain investments, or enter into certain other transactions. In 2018, we repaid all $290.0 million of the remaining principal amount of 2020 Senior Notes. We recognized a loss on debt extinguishment of $8.3 million. In 2017, we repaid $60.0 million of aggregate principal amount of 2020 Senior Notes. We recognized a loss on debt extinguishment of $1.8 million. We were in compliance with all of the covenants in the indenture governing our 2020 Senior Notes for all periods that these notes were outstanding. 2022 Senior Notes On April 16, 2014, we completed an offering of $500 million of 6.25% senior secured notes due May 1, 2022, in a private offering to qualified institutional buyers (“2022 Senior Notes”). Interest is payable semiannually, in arrears, on May 1 and November 1. The Company received net proceeds of $489.7 million after debt issuance costs of $10.3 million, which resulted in an effective interest rate of 6.58% for these notes. The obligation to pay principal and interest on the 2022 Senior Notes is jointly and severally guaranteed on a full and unconditional basis by all of our wholly owned domestic subsidiaries. The 2022 Senior Notes are secured on a first priority basis by 100% of the equity interests of our existing and future domestic subsidiaries and 65% of the voting equity interests of our existing and future foreign subsidiaries. The 2022 Senior Notes are secured on a second priority basis by our accounts receivable, inventory, and deposit accounts, which also secure our 2020 Senior Notes as discussed above. All security requirements for the 2022 Senior Notes will cease upon the full repayment of our $550 million term loan discussed below. The 2022 Senior Notes are redeemable, at our option, beginning on May 1, 2017, at a premium of approximately 4.7%. The redemption premium then declines each year until May 1, 2020, at which time we may redeem the notes at par value. The 2022 Senior Notes contain covenants that could, in certain circumstances, limit our ability to issue additional debt, repurchase or pay dividends on our common or preferred stock, sell substantially all of our assets, make certain investments, or enter into certain other transactions. In 2018, we repurchased $22.1 million of aggregate principal amount of 2022 Senior Notes in the qualified institutional market. We recognized a gain on debt extinguishment of $1.2 million. In 2017, we repurchased $17.3 million of aggregate principal amount of 2022 Senior Notes in the qualified institutional market. We recognized a gain on debt extinguishment of $0.4 million. In 2016, we repurchased $43.7 million of aggregate principal amount of 2022 Senior Notes in the qualified institutional market. We recognized a gain on debt extinguishment of $25.4 million. We were in compliance with all of the covenants in the indenture governing our 2022 Senior Notes at December 31, 2018 and 2017. Term Loan On April 16, 2014, we entered into a $550 million term loan, which matures on April 16, 2021, (“Term Loan”) with a group of lenders with Wells Fargo Bank, N.A., as administrative agent. The Term Loan bears interest at LIBOR plus a margin of 4.75% per annum, with a 1.00% LIBOR floor. Interest is payable on interest rate reset dates, which generally will be on a three-month basis. The Term Loan was issued at a discount of $2.7 million for aggregate consideration of $547.3 million and resulted in net proceeds to the Company of $540.0 million after debt issuance costs of $7.3 million. The effective interest rate of the Term Loan was 7.6% at December 31, 2018. The obligation to pay principal and interest on the Term Loan is jointly and severally guaranteed on a full and unconditional basis by all of our wholly owned domestic subsidiaries. The Term Loan is secured on the same basis as the 2022 Senior Notes as discussed above. The Term Loan contains substantially the same covenants as the 2022 Senior Notes and the 2020 Senior Notes. None of the Term Loan, the 2022 Senior Notes, or the 2020 Senior Notes contain maintenance financial covenants. In 2018, we repaid $310.0 million of aggregate principal amount of Term Loan. We recognized a loss on debt extinguishment of $2.7 million. In 2016, we repaid $49.0 million of aggregate principal amount of Term Loan. We recognized a gain on debt extinguishment of $28.3 million. We were in compliance with all of the covenants in the Term Loan at December 31, 2018 and 2017. Revolving Credit Facility On February 22, 2018, we entered into a $250 million revolving credit facility, with an initial maturity date of February 22, 2023, with a group of lenders with Wells Fargo, N.A., as administrative agent. The maturity date of the facility could be accelerated to January 16, 2021 or January 31, 2022, if we do not repay or refinance our Term Loan or 2022 Senior Notes, respectively, before these dates. LIBOR borrowings under the credit facility bear interest at LIBOR plus a margin of 1.75% to 2.00% per annum, depending on facility utilization. Base rate loans are also available at our option. The credit facility includes a $50 million sub-limit for the issuance of letters of credit. The issuance of letters of credit reduces the amount available under the facility. We also pay a commitment fee on the unused amount of the facility of 0.25% to 0.375% per annum, depending on facility utilization. The obligations under the credit facility are secured by substantially all of our accounts receivable, inventory, deposit accounts, intellectual property and the equity of some current and future wholly-owned domestic and foreign subsidiaries. The maximum availability of credit under the credit facility is limited at any time to the lesser of $250 million or a borrowing base. The borrowing base is based on percentages of eligible accounts receivable and eligible inventory and is subject to certain reserves. In an event of default or if the amount available under the credit facility is less than either 10% of our maximum availability or $12.5 million, we will be required to maintain a minimum fixed charge coverage ratio of 1.0 to 1.0. If at any time borrowings and letters of credit issued under the credit facility exceed the borrowing base, we will be required to repay an amount equal to such excess. The credit facility contains covenants that could, in certain circumstances, limit our ability to issue additional debt, repurchase or pay dividends on our common stock, sell substantially all of our assets, make certain investments, or enter into certain other transactions. We were in compliance with all of the covenants in the credit facility at December 31, 2018. As of February 28, 2019, the borrowing base was $113.2 million and therefore our maximum availability under the credit facility was $113.2 million. As of February 28, 2019, there were no borrowings outstanding under the credit facility, and letters of credit totaling $7.1 million were issued, resulting in $106.1 million of availability under the credit facility. The following table summarizes the maturities of our long-term debt at December 31, 2018: (In millions) 2019 $ — 2020 — 2021 121.0 2022 386.9 2023 — 2024 and thereafter — Total principal amount of long-term debt $ 507.9 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 12 Months Ended |
Dec. 31, 2018 | |
STOCKHOLDERS’ EQUITY (DEFICIT) | |
STOCKHOLDERS' EQUITY (DEFICIT) | NOTE 5 — STOCKHOLDERS’ EQUITY (DEFICIT) Initial Public Offering of Common Stock We completed an initial public offering (“IPO”) of 22.4 million shares of common stock at a price to the public of $18.00 per share, of which 18.1 million shares were sold by the Company and 4.3 million shares were sold by one of our stockholders, a subsidiary of Chesapeake Energy Corporation. The shares began trading on The New York Stock Exchange on February 2, 2018, under the ticker symbol “FTSI.” The Company received net proceeds from the offering of $303.0 million, after offering costs. We used the net proceeds from the offering for general corporate purposes, primarily debt repayments. The Company did not receive any proceeds from the offering of shares by the selling stockholder. Reverse Stock Split In connection with the IPO, we amended and restated our certificate of incorporation to effect a 69.258777:1 reverse stock split of our common stock. Convertible Preferred Stock In September 2012, we issued and sold 350,000 shares of Series A convertible preferred stock, par value $0.01 per share (the “Preferred Stock”), to certain of our then existing common stockholders. The Preferred Stock was sold for aggregate consideration of $350 million, and resulted in net proceeds to the Company of $349.8 million after the payment of $0.2 million in issuance costs. Each share of Preferred Stock was convertible into 2,573 shares of our common stock, subject to adjustment upon the occurrence of specified events set forth under terms of the Preferred Stock. The Preferred Stock was redeemable at the Company’s option at any time after all of our debt was repaid. The redemption price per share was an amount in cash equal to the original price per share of the Preferred Stock, plus such additional amount as would give the holder an after-tax internal rate of return for investment in the Preferred Stock of 25% per annum (the “Accreted Amount”). At December 31, 2017, the Accreted Amount of the Preferred Stock was estimated to be $1,132.7 million. The Preferred Stock was mandatorily convertible into shares of our common stock in connection with an initial public offering of our common stock if both of the following conditions were met (a “Qualified IPO”): · Aggregate proceeds to the Company were at least $250 million ; and · The split-adjusted initial offering price to the public was not less than $1.50 per share. In connection with a Qualified IPO, each share of Preferred Stock would be convertible into the number of shares of common stock that had a market value (based on the initial offering price to the public) equal to the Accreted Amount. The Preferred Stock was mandatorily redeemable for cash upon a change of control, provided that all of our debt had been repaid. Each share of Preferred Stock would be redeemed for an amount in cash equal to the higher of: · The Accreted Amount; or · The original purchase price of the Preferred Stock plus an amount equal to 20% of the then outstanding equity value of the Company divided by the number of Preferred Stock shares then outstanding. The Preferred Stock ranked senior to our common stock with respect to dividend rights and distribution rights in the event of any liquidation, winding-up or dissolution of the Company. The amount that each share of Preferred Stock was entitled to in liquidation is equal to the Accreted Amount. The holders of the Preferred Stock were also common stockholders of the Company and, prior to the completion of our initial public offering, collectively appointed 100% of our board of directors. Therefore, the Preferred Stock holders could have directed the Company to redeem the Preferred Stock at any time after all of our debt had been repaid; however, we did not consider this to be probable for the periods presented due to the amount of debt outstanding. Therefore, we classified the Preferred Stock as temporary equity on our Consolidated Balance Sheets but did not record any accretion of the Preferred Stock in our consolidated financial statements. In connection with the IPO, a number of shares of our convertible Preferred Stock converted into common stock at the rate of 155.944841 shares of common stock per each share of Preferred Stock. All remaining shares of Preferred Stock were canceled. We refer to this conversion and the cancelation together as the recapitalization of the Preferred Stock. The conversion rate of the Preferred Stock and shares canceled were calculated so that following the recapitalization, stockholders that did not own Preferred Stock would own 7% of our common stock prior to the IPO. The recapitalization of all outstanding shares of our Preferred Stock resulted in 39.4 million new shares of common stock. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2018 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | NOTE 6 — STOCK-BASED COMPENSATION 2014 Long-Term Incentive Plan In 2014, our stockholders approved the 2014 Long-Term Incentive Plan (“2014 LTIP”). The 2014 LTIP authorized the grant of up to 55 million restricted stock units (“RSU”) to salaried employees of the Company, as determined by the compensation committee of the board of directors. This plan originally was set to expire on March 3, 2024. The 2014 LTIP allowed for the grant of stock-settled and cash-settled RSUs. The Company had the power to elect, at its sole discretion, to settle any or all of the stock-settled RSUs wholly or partly in cash. The awards that were granted in 2014 had three vesting conditions: a performance condition based on Company goals, a performance condition based on the occurrence of a qualifying liquidity event such as an initial public offering of our common stock, and a service-period condition. The performance condition was based on Company goals that provided for an upward or downward adjustment to the RSUs granted based on Company performance. The service-period condition provided that 50% of the number of adjusted RSUs vested on each of December 31, 2015, and December 31, 2016. Under generally accepted accounting principles for stock-based compensation, a performance condition that affects vesting and is based on a corporate liquidity event such as an initial public offering of common stock precludes the recognition of compensation expense related to the awards until this performance condition has been met. Therefore, no compensation expense for these awards was recognized until this performance condition was met. In February 2018, we completed an IPO of our common stock. This transaction qualified as the final vesting condition for these RSUs. The compensation expense recognized in 2018 for the stock-settled RSUs was $2.0 million. The compensation expense recognized in 2018 for the cash-settled RSUs was $1.7 million. The Company elected to settle the stock-settled RSUs in cash. The 2014 LTIP was terminated after the payout of the RSUs. 2018 Equity and Incentive Compensation Plan Our board of directors and stockholders adopted the 2018 Equity and Incentive Compensation Plan (“2018 Plan”) to attract and retain officers, employees, directors, consultants and other key personnel and to provide those persons incentives and awards for performance. The 2018 Plan allocated 2.8 million shares of common stock in the form of incentive stock options, non-qualified stock options, restricted stock, restricted stock units, stock appreciation rights, or other stock-based awards. Any shares that become available as a result of forfeiture, cancelation, expiration or cash settlement of an award are allowed to be granted again at a future date under the 2018 Plan. RSUs are valued at the market price of a share of our common stock on the date of grant. All awards granted to employees vest in 25% increments over a four-year period from the date of grant and are expensed on a straight-line basis over that period, which is considered to be the requisite service period. The following table summarizes the 2018 transactions related to the RSUs granted under the 2018 Plan. Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at January 1, 2018 — $ — Granted 3,000 19.67 Vested (250) 19.90 Forfeited (310) 19.90 Unvested balance at December 31, 2018 2,440 $ 19.62 The compensation committee of our board of directors granted 3.0 million restricted stock units (“RSUs”) to employees and a non-employee director in 2018. Some RSUs were forfeited during the year and subsequently granted again to other employees. As of December 31, 2018, 2.4 million unvested RSUs were outstanding under this plan, and up to approximately 131,000 shares were available for future grants under this plan. Stock-based compensation expense for these RSUs was $15.2 million 2018. The weighted-average grant-date fair value per share of RSUs granted was $19.67 in 2018. The grant-date fair value of these RSUs was based on the price of our common stock on the date of grant. The fair value of RSUs vested was $5.0 million in 2018. At December 31, 2018, there was $37.6 million of total unrecognized compensation cost related to unvested RSUs, which is expected to be recognized over a weighted average period of 3.2 years. The compensation cost charged against income for all stock-based compensation was $18.9 million, zero and zero in 2018, 2017 and 2016, respectively. The total income tax benefit for all stock-based compensation was $3.8 million in 2018; however, such benefit was substantially offset by the valuation allowance against our deferred tax assets. |
RETIREMENT PLAN
RETIREMENT PLAN | 12 Months Ended |
Dec. 31, 2018 | |
RETIREMENT PLAN | |
RETIREMENT PLAN | NOTE 7 — RETIREMENT PLAN We offer a 401(k) defined contribution retirement plan (“401(k) Plan”), which allows a participant to defer, by payroll deductions, from 0% to 100% of the participant’s annual compensation, limited to certain annual maximums set by the Internal Revenue Code. The 401(k) Plan has historically provided a discretionary matching contribution to each participant’s account. Company matching contributions to the 401(k) Plan are made in cash and were $4.1 million, $1.5 million, and zero in 2018, 2017 and 2016, respectively. The Company suspended matching contributions in July 2015 and resumed making contributions in July 2017. |
IMPAIRMENTS AND OTHER CHARGES
IMPAIRMENTS AND OTHER CHARGES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
IMPAIRMENTS AND OTHER CHARGES | NOTE 8 — IMPAIRMENTS AND OTHER CHARGES The following table summarizes our impairments and other charges: Year Ended December 31, (In millions) 2018 2017 2016 Supply commitment charges $ 19.2 $ 1.2 $ 2.5 Impairment of assets — — 7.0 Lease abandonment charges — 0.6 2.0 Employee severance costs — — 0.8 Total impairments and other charges $ 19.2 $ 1.8 $ 12.3 Supply Commitment Charges We incur supply commitment charges when our purchases of proppant from certain suppliers are less than the minimum purchase commitments in our supply contracts. According to the accounting guidance for firm purchase commitments, future charges that are considered likely are also required to be recorded in the current period. We recorded aggregate charges under these supply contracts of $19.2 million, $1.2 million and $2.5 million in 2018, 2017 and 2016, respectively. These charges related to actual purchase shortfalls incurred, as well as forecasted purchase shortfalls that are expected to be incurred and settled in future periods. Approximately $12 million of our 2018 supply commitment charges relate to estimated losses under these contracts for 2019. These purchase shortfalls are due to our customers choosing to provide their own proppant, our customers’ desire to purchase sand from sand mines closer to their operating areas, increased purchase commitments in 2019, and low activity levels in 2016. A significant majority of our contracted proppant is for sand types that are mined primarily in the Midwestern United States (“Northern White” sand). Since we executed these contracts, customer demand for sand has shifted away from Northern White sand and towards lower-cost sand that is available from sand mines closer in proximity to our customers’ operating locations. We are in discussions with our vendors to modify our supply contracts to better align with our customers’ volume requirements, preferred sand types, and preferred sand mine locations. Estimated losses related to these supply contracts contain uncertainties, such as future customer demand, future customer sand preferences, the legal defenses available to us, and the outcome of our ongoing vendor discussions. These uncertainties require us to use judgment to quantify the amount of these estimates. Actual results could materially differ from our estimate. While we have successfully worked with our vendors to minimize charges related to these purchase commitments in the past, if we do not meet the minimum purchase commitments in the future and we are unable to adjust or avoid our contracted amounts, we may incur additional supply commitment charges in future periods. Impairment of Assets During 2016, we recorded asset impairments of $7.0 million related to service equipment and real property that we no longer use and identified to sell. Lease Abandonment Charges During 2016, we vacated certain leased facilities to consolidate our operations. In 2017 and 2016, we recognized expense of $0.6 million and $2.0 million, respectively, in connection with these actions. Employee Severance Costs During 2016, we incurred employee severance costs of $0.8 million in connection with our corporate and operating restructuring initiatives. At December 31, 2016, we had paid substantially all severance payments owed to former employees. |
ASSET DISPOSALS
ASSET DISPOSALS | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
ASSET DISPOSALS | NOTE 9 — ASSET DISPOSALS During 2017 and 2016, we sold a number of surplus pieces of property and equipment. In 2017, we received $4.1 million of proceeds and recognized a $1.4 million net gain on the sale of these assets. In 2016, we received $23.5 million of proceeds and recognized a $1.3 million net loss on the sale of these assets. In February 2016, we sold substantially all of our remaining sand transportation equipment and related inventory. We received $8.0 million of proceeds and recognized a $0.3 million gain on this sale. |
GAIN ON INSURANCE RECOVERIES
GAIN ON INSURANCE RECOVERIES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
GAIN ON INSURANCE RECOVERIES | NOTE 10 — GAIN ON INSURANCE RECOVERIES In January 2017, a fire destroyed certain equipment in one of our fleets. These assets were insured at values greater than their carrying values. We received $4.2 million of insurance recovery proceeds for these assets, which exceeded their carrying values by $2.9 million. In January 2016, a fire at one of our job sites in Oklahoma destroyed substantially all of the equipment in one of our fleets. These assets were insured at values greater than their carrying values. We received $19.0 million of insurance recovery proceeds for these assets, which exceeded their carrying values by $15.1 million. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
INCOME TAXES | NOTE 11 — INCOME TAXES The following table summarizes the components of income tax expense (benefit): Year Ended December 31, (In millions) 2018 2017 2016 Current: Federal $ — $ — $ — State 2.0 1.6 (1.6) Total current 2.0 1.6 (1.6) Total deferred — — — Income tax expense (benefit) $ 2.0 $ 1.6 $ (1.6) Actual income tax expense (benefit) differed from the amount computed by applying the statutory federal income tax rate to income (loss) before income taxes as follows: Year Ended December 31, (In millions) 2018 2017 2016 Income (loss) before income taxes $ 260.4 $ 202.3 $ (190.1) Statutory federal income tax rate 21.0 % 35.0 % 35.0 % Federal income tax expense (benefit) at statutory rate 54.7 70.8 (66.5) State income tax expense (benefit), net of federal effect 5.5 7.2 (6.7) Effect of changes in income apportionment amongst states 6.1 8.2 — Effect of U.S. tax law change — 424.8 — Other items, net 0.2 1.7 0.1 Change in valuation allowance (64.5) (511.1) 71.5 Income tax expense (benefit) $ 2.0 $ 1.6 $ (1.6) Effective tax rate 0.8 % 0.8 % 0.8 % Due to the mobile nature of our operations, the apportionment of annual income that we earn in a state can change over time. States have different income tax rates and therefore the weighted-average state tax rate that we apply to our taxable and deductible temporary differences and net operating loss carryforwards can also change over time. The resulting effects on our deferred tax assets and deferred tax liabilities are recognized in the current period and affects our overall effective tax rate; however, these changes are offset by corresponding changes in our valuation allowance. In December 2017, the President of the United States signed into law H.R. 1, or commonly referred to as the Tax Cuts and Jobs Act of 2017 that, among other things, reduced the federal income tax rate from 35% to 21% beginning on January 1, 2018. Under generally accepted accounting principles for income taxes, we are required to recognize the effects of changes in tax laws and tax rates on deferred tax assets and liabilities in the period in which the new legislation is enacted. Accordingly, we remeasured our federal deferred tax assets as of December 31, 2017, to a 21% rate. This would have resulted in additional tax expense of $424.8 million in 2017; however, this amount was offset by a corresponding change in our valuation allowance. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below: December 31, (In millions) 2018 2017 Deferred tax assets: Goodwill and intangible assets $ 313.0 $ 365.3 Federal net operating loss carryforwards 319.4 338.0 State net operating loss carryforwards, net of federal benefit 41.0 39.7 Accrued liabilities 5.7 4.5 Stock-based compensation 2.4 — Other 1.8 2.3 Gross deferred tax assets 683.3 749.8 Valuation allowance (671.0) (735.5) Total deferred tax assets 12.3 14.3 Deferred tax liabilities: Property, plant, and equipment 12.3 14.3 Total deferred tax liabilities 12.3 14.3 Net deferred tax asset $ — $ — Because of our valuation allowance, our net deferred tax assets are zero and no deferred tax assets or liabilities are included in the Consolidated Balance Sheets. At December 31, 2018, our federal net operating loss carryforwards were $1,520.0 million, which will expire on various dates between 2032 and 2036. Our state net operating loss carryforwards will expire on various dates between 2019 and 2037. A reconciliation of the valuation allowance for deferred tax assets from January 1, 2016 to December 31, 2018 is as follows: (In millions) 2018 2017 2016 Balance at January 1 $ 735.5 $ 1,246.6 $ 1,175.1 Additions — — 71.5 Deductions (64.5) (511.1) — Balance at December 31 $ 671.0 $ 735.5 $ 1,246.6 In 2012, we established a full valuation allowance with respect to our net deferred tax assets. We have recorded a full valuation allowance for these net deferred tax assets for each year since 2012. As a result, we only recorded income tax expense for states that limit the deduction of net operating loss carryforwards. Deferred tax assets related to our U.S. federal and state tax net operating losses are still available to us to offset future taxable income, subject to limitations in the event of a change of control under Section 382 of the Internal Revenue Code. At December 31, 2018, we had not incurred such an ownership change. At each reporting date, we consider all available positive and negative evidence to evaluate whether our deferred tax assets are more likely than not to be realized. A significant piece of negative evidence that we consider is whether we have incurred cumulative losses (generally defined as losses before income taxes) in recent years. Such negative evidence weighs heavily against other more subjective positive evidence such as our projections for future taxable income. We noted that for the three years ended December 31, 2018, we recorded cumulative income before income taxes of $272.6 million. This is the first three-year period with cumulative income since we established the full valuation allowance in 2012. Notwithstanding the shift to three-year cumulative income, we concluded that a full valuation allowance was still required at December 31, 2018. We based this conclusion on the positive and negative evidence discussed below. The primary positive evidence we noted was: · Our income before income taxes in 2018 and 2017 was $260.4 million and $202.3 million. · We are forecasting that 2019 will be a profitable year. The primary negative evidence we noted was: · The cumulative income before income taxes for the three-year period ended December 31, 2018, was the only profitable three-year period since 2012. · The forecasts of our results and the consensus forecasts of the hydraulic fracturing industry have been historically volatile due to the up-and-down cycles experienced by the industry. · We have over $1.3 billion of deductible temporary differences that will reverse over the next seven years. These deductions will significantly limit the amount of net operating loss carryforwards that we will be able to realize over that time. These deductions also increase the likelihood that we could generate additional net operating losses in future periods. · The price of oil declined significantly in the fourth quarter of 2018. A significant decrease in the price of oil has historically resulted in a decrease in our customers’ activity levels and a corresponding decrease in our earnings. · We do not have prudent and feasible tax-planning strategies available to us to realize deferred tax assets. If we continue to generate income before income taxes in future periods and if our forecasts become more accurate due to the cycles of the hydraulic fracturing industry becoming less significant, we may be able to recognize a portion of our net deferred tax assets in future periods. We will adjust the valuation allowance based on our evaluation of new information as it becomes available and new circumstances as they occur. Due to the prevailing negative evidence cited above, we believe that the earliest period when we may adjust the valuation allowance is the fourth quarter of 2019. A reconciliation of the liability for gross unrecognized income tax benefits (excluding interest) from January 1, 2016 to December 31, 2018 is as follows: (In millions) 2018 2017 2016 Balance at January 1 $ — $ — $ 1.4 Lapse in applicable statute of limitations — — (1.4) Balance at December 31, $ — $ — $ — The amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was zero at December 31, 2018 and 2017, respectively. We recognize accrued interest and penalties related to any uncertain tax positions as part of the tax provision. At December 31, 2018 and 2017, we had no accrued interest expense associated with unrecognized tax benefits. Interest expense associated with unrecognized tax benefits was zero for all periods presented. FTS International, Inc. and its U.S. subsidiaries join in the filing of a U.S. federal consolidated income tax return. We do not currently have significant operations or undistributed earnings in foreign jurisdictions. Our income tax returns are currently subject to examination in federal and state jurisdictions primarily for tax years from 2014 through 2017. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure Text Block | |
COMMITMENTS AND CONTINGENCIES | NOTE 12 — COMMITMENTS AND CONTINGENCIES Operating Leases We lease certain administrative and sales offices, operational facilities and office equipment in various cities. We also lease some service equipment, light duty vehicles, and equipment used to transport sand and other proppants to our job locations. Some of our lease agreements include renewal or purchase options that we may choose to exercise at the end of the lease term. Total rental expense under our operating leases was $49.9 million, $26.8 million and $19.6 million in 2018, 2017 and 2016, respectively. At December 31, 2018, our future minimum rental commitments due under non-cancellable operating leases is summarized below: (In millions) 2019 2020 2021 2022 2023 Thereafter Operating leases $ 26.0 $ 14.9 $ 4.6 $ 1.5 $ 1.5 $ 1.1 Purchase Obligations We have purchase commitments with certain vendors to supply a significant portion of the proppant used in our operations. These agreements have remaining terms ranging from one to six years. Some of these agreements have minimum unconditional purchase obligations. These minimum purchase obligations could change based upon the vendors ability to supply a minimum requirement. Total purchases made under these agreements were $33.8 million, $38.8 million and $20.9 million in 2018, 2017 and 2016, respectively. At December 31, 2018, our future minimum purchase commitments due under these agreements is summarized below: (In millions) 2019 2020 2021 2022 2023 Thereafter Purchase obligations $ 56.5 $ 51.6 $ 48.3 $ 47.9 $ 47.9 $ 47.9 Litigation In the ordinary course of business, we are subject to various legal proceedings and claims, some of which may not be covered by insurance. Many of these legal proceedings and claims are in early stages, and many of them seek an indeterminate amount of damages. We estimate and provide for potential losses that may arise out of legal proceedings and claims to the extent that such losses are probable and can be reasonably estimated. Significant judgment is required in making these estimates and our final liabilities may ultimately be materially different from these estimates. When preparing our estimates, we consider, among other factors, the progress of each legal proceeding and claim, our experience and the experience of others in similar legal proceedings and claims, and the opinions and views of legal counsel. Legal costs related to litigation contingencies are expensed as incurred. With respect to the litigation matters below, if there is an adverse outcome individually or collectively, there could be a material adverse effect on the Company’s consolidated financial position or results of operations. These litigation matters are subject to inherent uncertainties and management’s view of these matters may change in the future. Therefore, there can be no assurance as to the ultimate outcome of these matters. Regardless of the outcome, any such litigation and claims can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Patterson v. FTS International Manufacturing, LLC and FTS International Services, LLC : On June 24, 2015, Joshua Patterson filed a lawsuit against the Company in the 115 th Judicial District Court of Upshur County, Texas, alleging, among other things, that the Company was negligent with respect to an automobile accident in 2013. Mr. Patterson sought monetary relief of more than $1 million. On July 19, 2018, a jury returned a verdict of approximately $100 million, including punitive damages, against the Company. The trial court reduced the judgment on November 12, 2018 to approximately $33 million. The Company’s insurance carriers have been defending the suit and are appealing the final judgment. While the outcome of this case is uncertain, the Company has met its insurance deductible for this matter and we do not expect the ultimate resolution of this case to have a material adverse effect on our consolidated financial statements. Securities Act Litigation : On February 22, 2019, Carol Glock filed a purported securities class action in the 160th Civil District Court of Dallas County, Texas (Cause No. DC-19-02668) against the Company, certain of our officers, directors and stockholders, and certain of the underwriters of our IPO. The complaint is brought on behalf of an alleged class of persons or entities who purchased our common stock in or traceable to our IPO, and purports to allege claims arising under Sections 11 and 15 of the Securities Act of 1933, as amended. The complaint generally alleges that the defendants violated federal securities laws relating to the disclosure in the registration statement and prospectus filed with the Securities and Exchange Commission in connection with our IPO. The complaint seeks, among other relief, class certification, damages in an amount in excess of $1.0 million, and reasonable costs and expenses, including attorneys’ fees. We are in the preliminary stages of reviewing the allegations made in the complaint and, as a result, we cannot predict the outcome or consequences of this case, which we intend to vigorously defend. We believe that costs associated with other legal matters will not have a material adverse effect on our consolidated financial statements. |
NONRECURRING FAIR VALUE MEASURE
NONRECURRING FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2018 | |
NONRECURRING FAIR VALUE MEASUREMENTS | |
NONRECURRING FAIR VALUE MEASUREMENTS | NOTE 13 — NONRECURRING FAIR VALUE MEASUREMENTS The following table represents the placement in the fair value hierarchy of assets that were measured at fair value on a nonrecurring basis. See Note 8 — “Impairments and Other Charges” for further discussion. Previous Total Carrying Fair Fair value measurements using Values (1) Value (1) Level 1 Level 2 Level 3 During 2016 Property no longer used $ 1.0 $ — $ — $ — $ — Long-lived assets held for sale (2) 12.4 6.4 — — 6.4 $ 13.4 $ 6.4 $ — $ — $ 6.4 (1) Represents the value on the date of the fair value measurement. (2) Equipment value based on pending contract price. |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 12 Months Ended |
Dec. 31, 2018 | |
EARNINGS (LOSS) PER SHARE | |
EARNINGS (LOSS) PER SHARE | NOTE 14 — EARNINGS (LOSS) PER SHARE The numerators and denominators of the basic and diluted earnings (loss) per share (“EPS”) computations for our common stock are calculated as follows: Year Ended December 31, (In millions, except per share amounts) 2018 2017 2016 Numerator: Net income (loss) $ 258.4 $ 200.7 $ (188.5) Convertible preferred stock accretion — (226.6) (181.6) Net reversal of convertible preferred stock 423.2 — — Net income (loss) attributable to common 681.6 (25.9) (370.1) Add back the effect of dilutive securities: Convertible preferred stock accretion (3) — — — Net income (loss) attributable to common $ 681.6 $ (25.9) $ (370.1) Denominator: Weighted average shares used for 104.2 51.8 51.8 Effect of dilutive securities: Convertible preferred stock (3) — — — Restricted stock units (4) (5) — — — Dilutive potential common shares — — — Number of shares used for 104.2 51.8 51.8 Basic and diluted EPS $ 6.54 $ (0.50) $ (7.14) (1) The weighted average shares outstanding has been adjusted to give effect to a 69.258777 : 1 reverse stock split that occurred in February 2018 in connection with the completion of our IPO. (2) The accreted value of our Preferred Stock was $1,132.7 million at December 31, 2017. In connection with our IPO, the Preferred Stock was recapitalized into 39.4 million shares of common stock. These shares of common stock had a value of $709.5 million at the IPO share price of $18.00, which resulted in a net reversal of $423.2 million of convertible preferred stock accretion previously recognized. (3) Dilutive securities in our diluted EPS calculation do not include the effects of converting the convertible preferred stock because the effect would be antidilutive. The number of common stock equivalents attributable to convertible preferred stock was 13.0 million shares as of December 31, 2017 and 2016. (4) Dilutive securities in our diluted EPS calculation do not include RSUs granted under our 2014 LTIP. Vesting of these RSUs was dependent upon the satisfaction of both a service condition and a corporate liquidity event such as an initial public offering of our common stock. As of December 31, 2017 and 2016, a corporate liquidity event had not occurred and the holders of these RSUs had no rights to our undistributed earnings. Therefore, they were excluded from the effect of dilutive securities. The number of common stock equivalents attributable to these RSUs was approximately 117,000 shares and 159,000 shares in 2017 and 2016, respectively. (5) Dilutive securities in our diluted EPS calculation for 2018 do not include RSUs granted under our 2018 Plan because the effect would be antidilutive. The number of common stock equivalents attributable to these RSUs was 2.4 million as of December 31, 2018. |
SELECTED QUARTERLY DATA (UNAUDI
SELECTED QUARTERLY DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2018 | |
SELECTED QUARTERLY DATA (UNAUDITED) | |
SELECTED QUARTERLY DATA (UNAUDITED) | NOTE 15 — SELECTED QUARTERLY DATA (UNAUDITED) Three Months Ended March 31, June 30, September 30, December 31, (In millions, except per share amounts) 2018 2018 2018 2018 Revenue Revenue $ 423.3 $ 454.6 $ 324.4 $ 248.1 Revenue from related parties 44.2 38.7 10.0 — Total revenue 467.5 493.3 334.4 248.1 Operating expenses Costs of revenue 312.2 329.4 222.2 169.4 Selling, general and administrative 25.8 20.8 19.7 21.6 Depreciation and amortization 20.6 20.7 21.1 22.3 Impairments and other charges 2.0 4.0 10.0 3.2 Loss (gain) on disposal of assets, net 0.5 (0.2) (0.1) (0.3) Total operating expenses 361.1 374.7 272.9 216.2 Operating income 106.4 118.6 61.5 31.9 Interest expense, net (17.4) (12.1) (10.4) (9.4) (Loss) gain on extinguishment of debt, net (9.3) (0.8) (0.6) 0.9 Equity in net income (loss) of joint venture affiliate — (1.2) (0.7) 3.0 Income before income taxes 79.7 104.5 49.8 26.4 Income tax expense (benefit) 1.0 0.9 0.2 (0.1) Net income $ 78.7 $ 103.6 $ 49.6 $ 26.5 Net income attributable to common stockholders $ 501.9 $ 103.6 $ 49.6 $ 26.5 Basic and diluted earnings per share $ 5.68 $ 0.95 $ 0.45 $ 0.24 Shares used in computing basic and 88.4 109.3 109.3 109.4 Three Months Ended March 31, June 30, September 30, December 31, (In millions, except per share amounts) 2017 2017 2017 2017 Revenue Revenue $ 191.9 $ 304.4 $ 409.8 $ 446.6 Revenue from related parties 21.6 40.5 39.2 12.1 Total revenue 213.5 344.9 449.0 458.7 Operating expenses Costs of revenue 174.8 236.3 298.8 299.9 Selling, general and administrative 19.5 20.8 21.7 19.0 Depreciation and amortization 21.8 21.3 22.1 21.4 Impairments and other charges 0.1 1.2 0.1 0.4 (Gain) loss on disposal of assets, net (0.4) (0.4) (0.8) 0.2 Gain on insurance recoveries (2.6) (0.3) — — Total operating expenses 213.2 278.9 341.9 340.9 Operating income 0.3 66.0 107.1 117.8 Interest expense, net (21.2) (21.5) (22.1) (21.9) Loss on extinguishment of debt, net — — — (1.4) Equity in net income (loss) of joint venture affiliate 0.9 0.2 (1.0) (0.9) (Loss) income before income taxes (20.0) 44.7 84.0 93.6 Income tax expense 0.1 0.4 0.4 0.7 Net (loss) income $ (20.1) $ 44.3 $ 83.6 $ 92.9 Net (loss) income attributable to common stockholders $ (71.4) $ (10.5) $ 25.1 $ 30.9 Basic and diluted (loss) earnings per share $ (1.38) $ (0.20) $ 0.48 $ 0.60 Shares used in computing basic and 51.8 51.8 51.8 51.8 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Policy Text Blocks | |
Basis of Presentation | Basis of Presentation We prepared the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of the Company and all majority-owned domestic and foreign subsidiaries. Investments over which we have the ability to exercise significant influence over operating and financial policies, but do not hold a controlling interest, are accounted for using the equity method of accounting. All significant intercompany accounts and transactions have been eliminated in consolidation. There were no items of other comprehensive income in the periods presented. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, related revenues and expenses, and the disclosure of gain and loss contingencies at the date of the financial statements and during the periods presented. We base these estimates on historical results and various other assumptions believed to be reasonable, all of which form the basis for making estimates concerning the carrying values of assets and liabilities that are not readily available from other sources. Actual results could differ materially from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents include only investments with an original maturity of three months or less. We occasionally hold cash deposits in financial institutions that exceed federally insured limits. We monitor the credit ratings and our concentration of risk with these financial institutions on a continuing basis to safeguard our cash deposits. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at their invoiced amounts or amounts for which we have a right to invoice based on services completed. We establish an allowance for doubtful accounts to reduce the carrying value of our accounts receivable based on a number of factors, including the length of time that accounts receivable are past due, our previous loss history, and the customer’s creditworthiness. The provision for doubtful accounts was not significant for any period presented in the Consolidated Statements of Operations. |
Inventories | Inventories Inventories consist of proppants and chemicals that are used to provide hydraulic fracturing services, maintenance parts that are used to service our hydraulic fracturing equipment, and explosives and perforating guns that are used to provide our wireline services. Proppants generally consist of raw sand, resin-coated sand or ceramic particles. Inventories are stated at the lower of cost or market value. The cost basis of our inventories is based on the average cost method and includes in-bound freight costs. As necessary, we record an adjustment to decrease the value of slow moving and obsolete inventory to its net realizable value. To determine the adjustment amount, we regularly review inventory quantities on hand and compare them to estimates of future product demand, market conditions, production requirements and technological developments. |
Restricted Cash | Restricted Cash We have pledged cash as collateral for letters of credit issued to our casualty and general liability insurance provider. Restricted cash totaled zero and $9.1 million at December 31, 2018 and 2017, respectively, and is included in prepaid expenses and other current assets in our Consolidated Balance Sheets. These amounts represent cash used to secure certain letters of credit. In February 2018, we closed on a new revolving credit facility, and issued replacement letters of credit under the new facility, which allowed us to cancel the cash secured letters of credit. |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment is stated at cost less accumulated depreciation, which is generally provided by using the straight-line method over the estimated useful lives of the individual assets. We manufacture our hydraulic fracturing units and the cost of this equipment, which includes direct and indirect manufacturing costs, is capitalized and carried as construction-in-progress until it is completed. Expenditures for renewals and betterments that extend the lives of our service equipment, which includes the replacement of significant components of service equipment, are capitalized and depreciated. Other repairs and maintenance costs are expensed as incurred. We capitalize qualifying costs related to the acquisition or development of internal-use software. Capitalization of costs begins after the conceptual formulation stage has been completed. Capitalized costs are amortized over the estimated useful life of the software, which ranges between three and five years. The unamortized balance of capitalized software costs at December 31, 2018 and 2017, was $3.7 million and $7.5 million, respectively. Amortization of computer software was $4.2 million, $5.3 million and $5.7 million in 2018, 2017 and 2016, respectively. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets We have historically acquired goodwill and indefinite-lived intangible assets related to business acquisitions. Goodwill is the amount by which the consideration transferred to acquire a business exceeds the fair value of the underlying individual assets and liabilities of that business. Goodwill and intangible assets with indefinite lives are not amortized. The amount of goodwill and indefinite-lived intangible assets recorded in our Consolidated Balance Sheets for the periods presented was zero and $29.5 million, respectively. Intangible assets with definite lives are amortized on a basis that reflects the pattern in which the economic benefits of the intangible assets are realized, which is generally on a straight-line basis over the asset’s estimated useful life. The amount of intangible assets with definite lives recorded in our Consolidated Balance Sheets for the periods presented was zero. |
Impairment of Long-Lived Assets, Goodwill and Other Intangible Assets | Impairment of Long-Lived Assets, Goodwill and Other Intangible Assets Long-lived assets, such as property, plant, equipment and definite-lived intangible assets, are reviewed for impairment when events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Recoverability is assessed based on the undiscounted future cash flows generated by the asset or asset group. If the carrying amount of an asset or asset group is not recoverable, we recognize an impairment loss equal to the amount by which the carrying amount exceeds fair value. We estimate fair value based on the income, market, or cost valuation techniques. Goodwill and intangible assets with indefinite lives are reviewed at least annually for impairment, and in interim periods if certain events occur indicating that the carrying value of goodwill or intangible assets may be impaired. We estimate fair values utilizing valuation methods such as discounted cash flows and comparable market valuations. We perform our annual impairment tests at the beginning of the fourth quarter. |
Equity Method Investments | Equity Method Investments Investments in which we have the ability to exercise significant influence, but not control, are accounted for pursuant to the equity method of accounting. We recognize our proportionate share of earnings or losses of our international affiliates three months after they occur. When events and circumstances warrant, investments accounted for under the equity method of accounting are evaluated for impairment. An impairment charge is recorded whenever a decline in value of an investment below its carrying amount is determined to be other-than-temporary. |
Income Taxes | Income Taxes Income taxes are accounted for using the asset and liability method. Deferred taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The effect on deferred taxes for a change in tax rates is recognized in earnings in the period that includes the enactment date. We recognize future tax benefits to the extent that such benefits are more likely than not to be realized. We record a valuation allowance to reduce the value of a deferred tax asset if based on the consideration of all available evidence, it is more likely than not that all or some portion of the deferred tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. We evaluate our deferred income taxes quarterly to determine if a valuation allowance is required by considering all available evidence, including historical and projected taxable income and tax planning strategies. Any deferred tax asset subject to a valuation allowance is still available to us to offset future taxable income, subject to annual limitations in the event of an “ownership change” under Section 382 of the Internal Revenue Code. We will adjust a previously established valuation allowance if we change our assessment of the amount of deferred income tax asset that is more likely than not to be realized. |
Revenue Recognition | Revenue Recognition The Company contracts with its customers to perform hydraulic fracturing services on one or more oil or natural gas wells. Under these arrangements, we satisfy our performance obligations as services are rendered, which is generally upon the completion of a fracturing stage. We typically complete one or more stages per day. A stage is considered complete when we have met the specifications set forth by the customer, at which time we have the right to invoice the customer and the customer is obligated to pay us for the services rendered. The price for our services typically includes an equipment charge and product charges for proppant, chemicals and other products actually consumed during the course of providing our services. The price for each stage of a particular well does not vary significantly. Payment terms average approximately two months from the date a stage is completed. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. We also contract with some customers to provide them with the exclusive use of a fracturing fleet for a period of time. We satisfy our performance obligation as services are rendered, which is based on the passage of time rather than the completion of a stage. Under these arrangements, we have the right to receive consideration from a customer even if circumstances outside of our control prevent us from performing our work. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. Pricing for our services is frequently negotiated with our customers and is based on prevailing market rates during each reporting period. The amounts we invoice our customers for services performed during a period are directly related to the value received by the customers for the period. There is no inherent uncertainty to the amount of consideration we will receive for services performed during a period and no judgment is required to allocate a portion of the transaction price to a future period. Accordingly, we are not required to identify any unsatisfied performance obligations nor attribute any revenue to them. During 2018 we acted as a principal, rather than as an agent, for all of the goods and services that we provided to our customers; our customer arrangements did not include obligations for refunds or warranties of our work; and we did not incur incremental costs to obtain or fulfill contracts with our customers. To comply with the FASB disclosure objective, we are required to disaggregate our revenue into categories if it will provide an enhanced understanding of how the nature, amount, timing, and uncertainty of our revenue and cash flows are affected by economic factors. To evaluate an appropriate level of disaggregation of revenue, we considered the following aspects of our business: · We provide a single service to our customers. · We only generate revenue in the U.S. onshore market. · We have a homogeneous customer base, which is comprised of large oil and gas exploration companies. · We provide our service over a short period of time. · We do not disaggregate our revenue into categories for any external communications or to make resource allocation decisions. · We do not have separate operating segments. Based on the above factors, we concluded that no additional disaggregation of revenue was necessary or meaningful to help depict the nature, amount, timing and uncertainty of our revenues and cash flows. |
Unconditional Purchase Obligations | Unconditional Purchase Obligations We have historically entered into inventory supply arrangements with our vendors, primarily for sand, that contain unconditional purchase obligations. These represent obligations to transfer funds in the future for fixed or minimum quantities of goods or services at fixed or minimum prices. We enter into these unconditional purchase obligation arrangements in the normal course of business to ensure that adequate levels of sourced product are available to us. To account for these arrangements, we must monitor whether we may be required to make a minimum payment to a vendor in a future period because our projected inventory purchases may not satisfy our minimum commitments. If we conclude that it is probable that we will make a minimum payment under these arrangements, we will record an estimated loss for these commitments in the current period. |
Stock-Based Compensation | Stock-Based Compensation We measure all employee stock-based compensation awards using a fair value method and record this cost in the consolidated financial statements. Our stock-based compensation relates to restricted stock units issued to our employees. On the date that an equity-classified award is granted, we determine the fair value of the award and recognize the compensation cost over the requisite service period, which typically is the period over which the award vests. For liability-classified awards, we determine the fair value of the award at each reporting date and recognize a portion of the fair value equal to the amount of time that has passed in the requisite service period. For equity-classified awards with graded vesting based solely on the satisfaction of a service condition, we recognize compensation cost as a single award on a straight-line basis. We account for forfeited awards as forfeitures occur, which results in a reversal of stock-based compensation cost previously recognized up to the date of the forfeiture. For stock-based awards with performance conditions that affect vesting, we only recognize compensation cost when it is probable that the performance conditions will be met. |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at a measurement date. We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: · Level One: The use of quoted prices in active markets for identical financial instruments. · Level Two: The use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or other inputs that are observable in the market or can be corroborated by observable market data. · Level Three: The use of significant unobservable inputs that typically require the use of management’s estimates of assumptions that market participants would use in pricing. |
New Accounting Standards Updates | New Accounting Standards Updates In May 2014, the Financial Accounting Standards Board (“FASB”), issued Accounting Standards Update (“ASU”), 2014-09, Revenue from Contracts with Customers . The FASB subsequently issued a number of additional ASUs to update this guidance. This guidance superseded substantially all existing accounting guidance related to the accounting for revenue transactions. This guidance establishes a core principle that an entity should record revenue when it transfers control of goods or services to customers at an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. We adopted this standard on January 1, 2018. Our approach to adopting this standard included performing a review of key contracts and comparing historical accounting policies and practices to the new accounting guidance. The accounting for revenue under the new ASU is materially consistent with our previous revenue recognition process. These consolidated financial statements have been prepared in accordance with the new ASU utilizing the modified retrospective method, which did not require a cumulative effect of accounting change at January 1, 2018. In February 2016, the FASB issued ASU 2016-02, Leases . The FASB subsequently issued a number of additional ASUs to update this guidance. This standard was issued to increase transparency and comparability among organizations by requiring that a right-of-use asset and corresponding lease liability be recorded on the balance sheet for leases with terms longer than 12 months. This standard is effective for our financial statements beginning on January 1, 2019. We transitioned to the new guidance using the modified retrospective transition method on the adoption date and we will recognize a cumulative-effect adjustment to our retained earnings for this accounting change on January 1, 2019. We plan to elect three practical expedients allowed under the guidance. According to these practical expedients we will not reassess whether existing contracts are or contain a lease; we will not reassess whether existing leases are operating or finance leases; and we will not reassess the accounting for initial direct costs for existing leases. We are in the process of determining the effects that the new standard will have on our consolidated financial statements. Our approach includes a review of existing leases and other executory contracts that may contain embedded leases and identifying the key terms that will be necessary for us to calculate the right-of-use asset and lease liability. We currently estimate that the adoption of this standard will increase our total assets and liabilities by approximately $40 million. These estimates could change before the completion of our adoption of this new guidance. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments . This standard was issued to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. We adopted this standard on January 1, 2018, and it had no effect on our consolidated statements of cash flows. In November 2016, the FASB issued ASU 2016-18, Restricted Cash . This standard was issued to change the presentation of amounts generally described as restricted cash and restricted cash equivalents to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted this standard on January 1, 2018, and the effects of this standard and related required disclosures have been reflected in our condensed consolidated statements of cash flows. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated statements of cash flows: December 31, (In millions) 2017 2016 Cash and cash equivalents $ 208.1 $ 160.3 Restricted cash included in prepaid expenses and other current assets 9.1 9.1 Total cash, cash equivalents, and restricted cash shown in the $ 217.2 $ 169.4 As of December 31, 2017 and 2016, we had amounts included in restricted cash that represented amounts required to be set aside by contractual agreement with our casualty and general liability insurance provider and corporate credit card provider. In February 2018, these contractual agreements to set aside cash were terminated. Therefore, as of December 31, 2018, we had no restricted cash balance. As a result of our adoption of ASU 2016-18, we recasted certain balances in our consolidated statement of cash flows for 2017 and 2016. The following table reflects the recasted balances: Year Ended December 31, 2017 (In millions) As Reported Adjustments Recasted Net cash used in investing activities $ (54.6) $ — $ (54.6) Cash, cash equivalents, and restricted cash at beginning of period $ 160.3 $ 9.1 $ 169.4 Cash, cash equivalents, and restricted cash at end of period $ 208.1 $ 9.1 $ 217.2 Year Ended December 31, 2016 (In millions) As Reported Adjustments Recasted Net cash provided by investing activities $ 43.1 $ (2.9) $ 40.2 Cash, cash equivalents, and restricted cash at beginning of period $ 264.6 $ 12.0 $ 276.6 Cash, cash equivalents, and restricted cash at end of period $ 160.3 $ 9.1 $ 169.4 |
DESCRIPTION OF BUSINESS (Tables
DESCRIPTION OF BUSINESS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Table Text Blocks | |
Schedule of customers who represented more than 10% of total revenue | Year Ended December 31, 2018 2017 2016 EQT Production Company 12 % * 12 % Devon Energy Corporation 12 % * * Newfield Exploration * * 18 % EP Energy Corporation * * 11 % Vine Oil and Gas, L.P. * * 10 % |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of cash and cash equivalents and restricted cash | December 31, (In millions) 2017 2016 Cash and cash equivalents $ 208.1 $ 160.3 Restricted cash included in prepaid expenses and other current assets 9.1 9.1 Total cash, cash equivalents, and restricted cash shown in the $ 217.2 $ 169.4 |
Schedule of restated cash balances | Year Ended December 31, 2017 (In millions) As Reported Adjustments Recasted Net cash used in investing activities $ (54.6) $ — $ (54.6) Cash, cash equivalents, and restricted cash at beginning of period $ 160.3 $ 9.1 $ 169.4 Cash, cash equivalents, and restricted cash at end of period $ 208.1 $ 9.1 $ 217.2 Year Ended December 31, 2016 (In millions) As Reported Adjustments Recasted Net cash provided by investing activities $ 43.1 $ (2.9) $ 40.2 Cash, cash equivalents, and restricted cash at beginning of period $ 264.6 $ 12.0 $ 276.6 Cash, cash equivalents, and restricted cash at end of period $ 160.3 $ 9.1 $ 169.4 |
SUPPLEMENTAL BALANCE SHEET IN_2
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | |
Schedule of Accounts Receivable | December 31, (In millions) 2018 2017 Trade accounts receivable $ 159.2 $ 233.2 Allowance for doubtful accounts (0.9) (2.1) Accounts receivable, net $ 158.3 $ 231.1 |
Schedule of change in allowance for doubtful accounts | (In millions) 2018 2017 2016 Balance at beginning of year $ 2.1 $ 2.3 $ 1.7 Provision for bad debts, net included in selling, general, — 0.3 1.3 Uncollectible receivables written off (1.2) (0.5) (0.7) Balance at end of year $ 0.9 $ 2.1 $ 2.3 |
Schedule of Inventories | December 31, (In millions) 2018 2017 Maintenance parts $ 60.3 $ 34.5 Proppants and chemicals 4.3 7.5 Other 2.0 2.5 Total inventories $ 66.6 $ 44.5 |
Schedule of Prepaid Expenses and Other Current Assets | December 31, (In millions) 2018 2017 Restricted cash $ — $ 9.1 Prepaid expenses 5.8 7.1 Other 1.2 3.7 Total prepaid expenses and other current assets $ 7.0 $ 19.9 |
Schedule of Property, Plant and Equipment, net | Estimated December 31, Useful Life (Dollars in millions) 2018 2017 (in years) Service equipment $ 780.5 $ 745.1 2.5 – 10 Buildings and improvements 63.1 63.1 15 – 39 Office, software, and other equipment 44.7 43.7 3 – 7 Vehicles and transportation equipment 9.2 13.6 5 – 20 Land 7.7 7.7 N/A Construction-in-process and other 32.4 35.3 N/A Total property, plant, and equipment 937.6 908.5 Accumulated depreciation and amortization (662.3) (637.6) Total property, plant, and equipment, net $ 275.3 $ 270.9 |
Schedule of Accrued Expenses and Other Current Liabilities | December 31, (In millions) 2018 2017 Sales, use, and property taxes $ 12.5 $ 19.3 Employee compensation and benefits 6.1 13.6 Interest 4.3 5.7 Insurance 4.3 3.3 Other 4.1 2.5 Total accrued expenses and other current liabilities $ 31.3 $ 44.4 |
INDEBTEDNESS AND BORROWING FA_2
INDEBTEDNESS AND BORROWING FACILITY (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Table Text Blocks | |
Summary of long-term debt | December 31, (In millions) 2018 2017 Senior floating rate notes due June 2020 $ — $ 290.0 Term loan due April 2021 121.0 431.0 Senior notes due May 2022 386.9 409.0 Total principal amount 507.9 1,130.0 Less unamortized discount and debt issuance costs (4.7) (13.6) Total long-term debt $ 503.2 $ 1,116.4 Estimated fair value of long-term debt $ 461.2 $ 1,113.8 |
Summary of maturities of the long-term debt | The following table summarizes the maturities of our long-term debt at December 31, 2018: (In millions) 2019 $ — 2020 — 2021 121.0 2022 386.9 2023 — 2024 and thereafter — Total principal amount of long-term debt $ 507.9 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of restricted stock and restricted stock units activity | Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at January 1, 2018 — $ — Granted 3,000 19.67 Vested (250) 19.90 Forfeited (310) 19.90 Unvested balance at December 31, 2018 2,440 $ 19.62 |
IMPAIRMENTS AND OTHER CHARGES (
IMPAIRMENTS AND OTHER CHARGES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Table Text Blocks | |
Schedule of impairments and other charges | Year Ended December 31, (In millions) 2018 2017 2016 Supply commitment charges $ 19.2 $ 1.2 $ 2.5 Impairment of assets — — 7.0 Lease abandonment charges — 0.6 2.0 Employee severance costs — — 0.8 Total impairments and other charges $ 19.2 $ 1.8 $ 12.3 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
INCOME TAXES | |
Schedule of components of income tax expense (benefit) | Year Ended December 31, (In millions) 2018 2017 2016 Current: Federal $ — $ — $ — State 2.0 1.6 (1.6) Total current 2.0 1.6 (1.6) Total deferred — — — Income tax expense (benefit) $ 2.0 $ 1.6 $ (1.6) |
Schedule of reconciliation of income tax expense (benefit) | Year Ended December 31, (In millions) 2018 2017 2016 Income (loss) before income taxes $ 260.4 $ 202.3 $ (190.1) Statutory federal income tax rate 21.0 % 35.0 % 35.0 % Federal income tax expense (benefit) at statutory rate 54.7 70.8 (66.5) State income tax expense (benefit), net of federal effect 5.5 7.2 (6.7) Effect of changes in income apportionment amongst states 6.1 8.2 — Effect of U.S. tax law change — 424.8 — Other items, net 0.2 1.7 0.1 Change in valuation allowance (64.5) (511.1) 71.5 Income tax expense (benefit) $ 2.0 $ 1.6 $ (1.6) Effective tax rate 0.8 % 0.8 % 0.8 % |
Schedule of deferred tax assets and deferred tax liabilities | December 31, (In millions) 2018 2017 Deferred tax assets: Goodwill and intangible assets $ 313.0 $ 365.3 Federal net operating loss carryforwards 319.4 338.0 State net operating loss carryforwards, net of federal benefit 41.0 39.7 Accrued liabilities 5.7 4.5 Stock-based compensation 2.4 — Other 1.8 2.3 Gross deferred tax assets 683.3 749.8 Valuation allowance (671.0) (735.5) Total deferred tax assets 12.3 14.3 Deferred tax liabilities: Property, plant, and equipment 12.3 14.3 Total deferred tax liabilities 12.3 14.3 Net deferred tax asset $ — $ — |
Schedule of reconciliation of the valuation allowance for deferred tax assets | (In millions) 2018 2017 2016 Balance at January 1 $ 735.5 $ 1,246.6 $ 1,175.1 Additions — — 71.5 Deductions (64.5) (511.1) — Balance at December 31 $ 671.0 $ 735.5 $ 1,246.6 |
Schedule of reconciliation of the liability for gross unrecognized income tax benefits (excluding interest) | (In millions) 2018 2017 2016 Balance at January 1 $ — $ — $ 1.4 Lapse in applicable statute of limitations — — (1.4) Balance at December 31, $ — $ — $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
COMMITMENTS AND CONTINGENCIES | |
Summary of future minimum rental commitments | (In millions) 2019 2020 2021 2022 2023 Thereafter Operating leases $ 26.0 $ 14.9 $ 4.6 $ 1.5 $ 1.5 $ 1.1 |
Summary of future minimum purchase commitments | (In millions) 2019 2020 2021 2022 2023 Thereafter Purchase obligations $ 56.5 $ 51.6 $ 48.3 $ 47.9 $ 47.9 $ 47.9 |
NONRECURRING FAIR VALUE MEASU_2
NONRECURRING FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
NONRECURRING FAIR VALUE MEASUREMENTS | |
Schedule of fair value hierarchy of assets that were measured at fair value on a nonrecurring basis | Previous Total Carrying Fair Fair value measurements using Values (1) Value (1) Level 1 Level 2 Level 3 During 2016 Property no longer used $ 1.0 $ — $ — $ — $ — Long-lived assets held for sale (2) 12.4 6.4 — — 6.4 $ 13.4 $ 6.4 $ — $ — $ 6.4 (1) Represents the value on the date of the fair value measurement. (2) Equipment value based on pending contract price. |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
EARNINGS (LOSS) PER SHARE | |
Schedule of computations for basic and diluted earnings (loss) per share | Year Ended December 31, (In millions, except per share amounts) 2018 2017 2016 Numerator: Net income (loss) $ 258.4 $ 200.7 $ (188.5) Convertible preferred stock accretion — (226.6) (181.6) Net reversal of convertible preferred stock 423.2 — — Net income (loss) attributable to common 681.6 (25.9) (370.1) Add back the effect of dilutive securities: Convertible preferred stock accretion (3) — — — Net income (loss) attributable to common $ 681.6 $ (25.9) $ (370.1) Denominator: Weighted average shares used for 104.2 51.8 51.8 Effect of dilutive securities: Convertible preferred stock (3) — — — Restricted stock units (4) (5) — — — Dilutive potential common shares — — — Number of shares used for 104.2 51.8 51.8 Basic and diluted EPS $ 6.54 $ (0.50) $ (7.14) (1) The weighted average shares outstanding has been adjusted to give effect to a 69.258777 : 1 reverse stock split that occurred in February 2018 in connection with the completion of our IPO. (2) The accreted value of our Preferred Stock was $1,132.7 million at December 31, 2017. In connection with our IPO, the Preferred Stock was recapitalized into 39.4 million shares of common stock. These shares of common stock had a value of $709.5 million at the IPO share price of $18.00, which resulted in a net reversal of $423.2 million of convertible preferred stock accretion previously recognized. (3) Dilutive securities in our diluted EPS calculation do not include the effects of converting the convertible preferred stock because the effect would be antidilutive. The number of common stock equivalents attributable to convertible preferred stock was 13.0 million shares as of December 31, 2017 and 2016. (4) Dilutive securities in our diluted EPS calculation do not include RSUs granted under our 2014 LTIP. Vesting of these RSUs was dependent upon the satisfaction of both a service condition and a corporate liquidity event such as an initial public offering of our common stock. As of December 31, 2017 and 2016, a corporate liquidity event had not occurred and the holders of these RSUs had no rights to our undistributed earnings. Therefore, they were excluded from the effect of dilutive securities. The number of common stock equivalents attributable to these RSUs was approximately 117,000 shares and 159,000 shares in 2017 and 2016, respectively. (5) Dilutive securities in our diluted EPS calculation for 2018 do not include RSUs granted under our 2018 Plan because the effect would be antidilutive. The number of common stock equivalents attributable to these RSUs was 2.4 million as of December 31, 2018. |
SELECTED QUARTERLY DATA (UNAU_2
SELECTED QUARTERLY DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
SELECTED QUARTERLY DATA (UNAUDITED) | |
Schedule of quarterly financial data | Three Months Ended March 31, June 30, September 30, December 31, (In millions, except per share amounts) 2018 2018 2018 2018 Revenue Revenue $ 423.3 $ 454.6 $ 324.4 $ 248.1 Revenue from related parties 44.2 38.7 10.0 — Total revenue 467.5 493.3 334.4 248.1 Operating expenses Costs of revenue 312.2 329.4 222.2 169.4 Selling, general and administrative 25.8 20.8 19.7 21.6 Depreciation and amortization 20.6 20.7 21.1 22.3 Impairments and other charges 2.0 4.0 10.0 3.2 Loss (gain) on disposal of assets, net 0.5 (0.2) (0.1) (0.3) Total operating expenses 361.1 374.7 272.9 216.2 Operating income 106.4 118.6 61.5 31.9 Interest expense, net (17.4) (12.1) (10.4) (9.4) (Loss) gain on extinguishment of debt, net (9.3) (0.8) (0.6) 0.9 Equity in net income (loss) of joint venture affiliate — (1.2) (0.7) 3.0 Income before income taxes 79.7 104.5 49.8 26.4 Income tax expense (benefit) 1.0 0.9 0.2 (0.1) Net income $ 78.7 $ 103.6 $ 49.6 $ 26.5 Net income attributable to common stockholders $ 501.9 $ 103.6 $ 49.6 $ 26.5 Basic and diluted earnings per share $ 5.68 $ 0.95 $ 0.45 $ 0.24 Shares used in computing basic and 88.4 109.3 109.3 109.4 Three Months Ended March 31, June 30, September 30, December 31, (In millions, except per share amounts) 2017 2017 2017 2017 Revenue Revenue $ 191.9 $ 304.4 $ 409.8 $ 446.6 Revenue from related parties 21.6 40.5 39.2 12.1 Total revenue 213.5 344.9 449.0 458.7 Operating expenses Costs of revenue 174.8 236.3 298.8 299.9 Selling, general and administrative 19.5 20.8 21.7 19.0 Depreciation and amortization 21.8 21.3 22.1 21.4 Impairments and other charges 0.1 1.2 0.1 0.4 (Gain) loss on disposal of assets, net (0.4) (0.4) (0.8) 0.2 Gain on insurance recoveries (2.6) (0.3) — — Total operating expenses 213.2 278.9 341.9 340.9 Operating income 0.3 66.0 107.1 117.8 Interest expense, net (21.2) (21.5) (22.1) (21.9) Loss on extinguishment of debt, net — — — (1.4) Equity in net income (loss) of joint venture affiliate 0.9 0.2 (1.0) (0.9) (Loss) income before income taxes (20.0) 44.7 84.0 93.6 Income tax expense 0.1 0.4 0.4 0.7 Net (loss) income $ (20.1) $ 44.3 $ 83.6 $ 92.9 Net (loss) income attributable to common stockholders $ (71.4) $ (10.5) $ 25.1 $ 30.9 Basic and diluted (loss) earnings per share $ (1.38) $ (0.20) $ 0.48 $ 0.60 Shares used in computing basic and 51.8 51.8 51.8 51.8 |
DESCRIPTION OF BUSINESS - (Deta
DESCRIPTION OF BUSINESS - (Details) - SinoFTS | Dec. 31, 2014 |
Percentage of ownership in joint venture | 45.00% |
Sinopec | |
Percentage of ownership in joint venture | 55.00% |
DESCRIPTION OF BUSINESS - Conce
DESCRIPTION OF BUSINESS - Concentrations of Risk (Details) - Total revenue - Customer risk | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2016 | |
EQT Production Company | ||
Concentrations of Risk | ||
Concentration risk (as a percent) | 12.00% | 12.00% |
Devon Energy Corporation | ||
Concentrations of Risk | ||
Concentration risk (as a percent) | 12.00% | |
Newfield Exploration | ||
Concentrations of Risk | ||
Concentration risk (as a percent) | 18.00% | |
EP Energy Corporation | ||
Concentrations of Risk | ||
Concentration risk (as a percent) | 11.00% | |
Vine Oil and Gas, L.P. | ||
Concentrations of Risk | ||
Concentration risk (as a percent) | 10.00% |
DESCRIPTION OF BUSINESS - Relat
DESCRIPTION OF BUSINESS - Related Parties (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | ||||||||||
Revenue from related parties | $ 10 | $ 38.7 | $ 44.2 | $ 12.1 | $ 39.2 | $ 40.5 | $ 21.6 | $ 92.9 | $ 113.4 | $ 2.7 |
Chesapeake | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Outstanding common stock held by related party (as a percent) | 20.00% | |||||||||
Revenue from related parties | $ 92.9 | 113.1 | 2.4 | |||||||
Accounts receivable from related parties | 2.7 | 0 | 2.7 | |||||||
SinoFTS | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Proceeds from sale of equipment | 0.3 | $ 0.3 | ||||||||
Accounts receivable from related parties | $ 0.3 | $ 0 | $ 0.3 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Restricted Cash, Goodwill and Intangible Assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Restricted cash included in prepaid expenses and other current assets | $ 0 | $ 9.1 |
Goodwill | 29.5 | 0 |
Amount of intangible assets with definite lives | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property, Plant and Equipment (Details) - Computer software - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment | |||
Unamortized balance of capitalized costs | $ 3.7 | $ 7.5 | |
Amortization | $ 4.2 | $ 5.3 | $ 5.7 |
Minimum | |||
Property, Plant and Equipment | |||
Estimated useful life | 3 years | ||
Maximum | |||
Property, Plant and Equipment | |||
Estimated useful life | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - New Accounting Standard Updates (Details) - USD ($) $ in Millions | Jan. 01, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Lessee assets and liabilities | |||
Assets | $ 743.7 | $ 831 | |
Liabilities | $ 636.8 | $ 1,299.5 | |
Accounting Standards Update 2016-02 | Proforma Adjustment | |||
Lessee assets and liabilities | |||
Assets | $ 40 | ||
Liabilities | $ 40 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash and Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Cash, restricted cash and cash equivalents | ||||
Cash and cash equivalents | $ 177.8 | $ 208.1 | ||
Restricted cash included in prepaid expenses and other current assets | 0 | 9.1 | ||
Total cash, cash equivalents and restricted cash shown on the condensed consolidated statements of cash flows | $ 177.8 | 217.2 | $ 169.4 | $ 276.6 |
Accounting Standards Update 2016-18 | ||||
Cash, restricted cash and cash equivalents | ||||
Cash and cash equivalents | 208.1 | 160.3 | ||
Restricted cash included in prepaid expenses and other current assets | 9.1 | 9.1 | ||
Total cash, cash equivalents and restricted cash shown on the condensed consolidated statements of cash flows | $ 217.2 | $ 169.4 | $ 276.6 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Restated Cash Balances (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash, restricted cash and cash equivalents | |||
Net cash used in investing activities | $ (98.6) | $ (54.6) | $ 40.2 |
Cash, cash equivalents, and restricted cash at beginning of period | 217.2 | 169.4 | 276.6 |
Cash, cash equivalents, and restricted cash at end of period | 177.8 | 217.2 | 169.4 |
Restricted cash | 0 | 9.1 | |
Accounting Standards Update 2016-18 | |||
Cash, restricted cash and cash equivalents | |||
Net cash used in investing activities | (54.6) | 40.2 | |
Cash, cash equivalents, and restricted cash at beginning of period | 217.2 | 169.4 | 276.6 |
Cash, cash equivalents, and restricted cash at end of period | 217.2 | 169.4 | |
Restricted cash | 9.1 | 9.1 | |
As Reported | Accounting Standards Update 2016-18 | |||
Cash, restricted cash and cash equivalents | |||
Net cash used in investing activities | (54.6) | 43.1 | |
Cash, cash equivalents, and restricted cash at beginning of period | 208.1 | 160.3 | 264.6 |
Cash, cash equivalents, and restricted cash at end of period | 208.1 | 160.3 | |
Adjustments | Accounting Standards Update 2016-18 | |||
Cash, restricted cash and cash equivalents | |||
Net cash used in investing activities | (2.9) | ||
Cash, cash equivalents, and restricted cash at beginning of period | $ 9.1 | 9.1 | 12 |
Cash, cash equivalents, and restricted cash at end of period | $ 9.1 | $ 9.1 |
SUPPLEMENTAL BALANCE SHEET IN_3
SUPPLEMENTAL BALANCE SHEET INFORMATION - (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounts receivable | |||
Trade accounts receivable | $ 159.2 | $ 233.2 | |
Allowance for doubtful accounts | (0.9) | (2.1) | |
Accounts receivable, net | 158.3 | 231.1 | |
Allowance for doubtful accounts | |||
Balance at beginning of year | 2.1 | 2.3 | $ 1.7 |
Provision for bad debts, net included in selling, general, and administrative expense | 0.3 | 1.3 | |
Uncollectible receivables written off | (1.2) | (0.5) | (0.7) |
Balance at end of year | 0.9 | 2.1 | $ 2.3 |
Inventories | |||
Maintenance parts | 60.3 | 34.5 | |
Proppants and chemicals | 4.3 | 7.5 | |
Other | 2 | 2.5 | |
Total inventories | 66.6 | 44.5 | |
Prepaid expenses and other current assets | |||
Restricted cash | 9.1 | ||
Prepaid expenses | 5.8 | 7.1 | |
Other | 1.2 | 3.7 | |
Total prepaid expenses and other current assets | $ 7 | $ 19.9 |
SUPPLEMENTAL BALANCE SHEET IN_4
SUPPLEMENTAL BALANCE SHEET INFORMATION - Property, Plant and Equipment - (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment | |||
Total property, plant, and equipment | $ 937.6 | $ 908.5 | |
Accumulated depreciation and amortization | (662.3) | (637.6) | |
Total property, plant, and equipment, net | 275.3 | 270.9 | |
Depreciation expense | 84.7 | 86.6 | $ 112.6 |
Equipment | |||
Property, Plant and Equipment | |||
Total property, plant, and equipment | $ 780.5 | 745.1 | |
Equipment | Minimum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 2 years 6 months | ||
Equipment | Maximum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 10 years | ||
Buildings and improvements | |||
Property, Plant and Equipment | |||
Total property, plant, and equipment | $ 63.1 | 63.1 | |
Buildings and improvements | Minimum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 15 years | ||
Buildings and improvements | Maximum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 39 years | ||
Office, software, and other equipment | |||
Property, Plant and Equipment | |||
Total property, plant, and equipment | $ 44.7 | 43.7 | |
Office, software, and other equipment | Minimum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 3 years | ||
Office, software, and other equipment | Maximum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 7 years | ||
Vehicles and transportation equipment | |||
Property, Plant and Equipment | |||
Total property, plant, and equipment | $ 9.2 | 13.6 | |
Vehicles and transportation equipment | Minimum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 5 years | ||
Vehicles and transportation equipment | Maximum | |||
Property, Plant and Equipment | |||
Estimated Useful Life (in years) | 20 years | ||
Land | |||
Property, Plant and Equipment | |||
Total property, plant, and equipment | $ 7.7 | 7.7 | |
Construction-in-process and other | |||
Property, Plant and Equipment | |||
Total property, plant, and equipment | $ 32.4 | $ 35.3 |
SUPPLEMENTAL BALANCE SHEET IN_5
SUPPLEMENTAL BALANCE SHEET INFORMATION - Accrued Expenses and Other Current Liabilities - (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
SUPPLEMENTAL BALANCE SHEET INFORMATION | ||
Sales, use, and property taxes | $ 12.5 | $ 19.3 |
Employee compensation and benefits | 6.1 | 13.6 |
Interest | 4.3 | 5.7 |
Insurance | 4.3 | 3.3 |
Other | 4.1 | 2.5 |
Total accrued expenses and other current liabilities | $ 31.3 | $ 44.4 |
INDEBTEDNESS AND BORROWING FA_3
INDEBTEDNESS AND BORROWING FACILITY - Summary of Long-term Debt (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
INDEBTEDNESS | ||
Total principal amount | $ 507.9 | $ 1,130 |
Less unamortized discount and debt issuance costs | (4.7) | (13.6) |
Total long-term debt | 503.2 | 1,116.4 |
Estimated fair value of long-term debt | 461.2 | 1,113.8 |
2020 Senior Floating Rate Notes | ||
INDEBTEDNESS | ||
Total principal amount | 290 | |
Term Loan | ||
INDEBTEDNESS | ||
Total principal amount | 121 | 431 |
2022 Senior notes | ||
INDEBTEDNESS | ||
Total principal amount | $ 386.9 | $ 409 |
INDEBTEDNESS AND BORROWING FA_4
INDEBTEDNESS AND BORROWING FACILITY - Senior Notes and Term Loan (Details) - USD ($) $ in Millions | Jun. 01, 2015 | Apr. 16, 2014 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument | ||||||||||
(Loss) gain on extinguishment of debt, net | $ 0.9 | $ (0.6) | $ (0.8) | $ (9.3) | $ (1.4) | $ (9.8) | $ (1.4) | $ 53.7 | ||
2020 Senior Floating Rate Notes | ||||||||||
Debt Instrument | ||||||||||
Debt instruments, Face amount | $ 350 | |||||||||
Margin rate | 7.50% | |||||||||
Interest payable period | P3M | |||||||||
Discount on debt instruments issued | $ 3.5 | |||||||||
Aggregate consideration | 346.5 | |||||||||
Net proceeds from debt | 340.5 | |||||||||
Debt issuance costs | $ 6 | |||||||||
Percentage of the Equity interests of existing and future domestic subsidiaries secured on a second priority basis for debt instruments | 100.00% | |||||||||
Percentage of the Equity interests of existing and future foreign subsidiaries secured on a second priority basis for debt instruments | 65.00% | |||||||||
Percentage of redemption premium on the debt issuance date | 3.00% | |||||||||
Principal amount repaid | 290 | 60 | ||||||||
(Loss) gain on extinguishment of debt, net | 8.3 | (1.8) | ||||||||
2022 Senior notes | ||||||||||
Debt Instrument | ||||||||||
Debt instruments, Face amount | $ 500 | |||||||||
Interest payable period | P6M | |||||||||
Net proceeds from debt | $ 489.7 | |||||||||
Debt issuance costs | $ 10.3 | |||||||||
Percentage of redemption premium on the debt issuance date | 4.70% | |||||||||
Percentage of the Equity interests of existing and future domestic subsidiaries secured on a first priority basis for debt instruments | 100.00% | |||||||||
Percentage of the Equity interests of existing and future foreign subsidiaries secured on a first priority basis for debt instruments | 65.00% | |||||||||
Principal amount repaid | 22.1 | 17.3 | 43.7 | |||||||
(Loss) gain on extinguishment of debt, net | 1.2 | $ 0.4 | 25.4 | |||||||
Interest rate | 6.25% | |||||||||
Effective interest rate | 6.58% | |||||||||
Amount of repayment of loan to cease security requirement upon senior notes | $ 550 | |||||||||
Term Loan | ||||||||||
Debt Instrument | ||||||||||
Debt instruments, Face amount | $ 550 | |||||||||
Margin rate | 4.75% | |||||||||
Interest payable period | P3M | |||||||||
Discount on debt instruments issued | $ 2.7 | |||||||||
Aggregate consideration | 547.3 | |||||||||
Net proceeds from debt | 540 | |||||||||
Debt issuance costs | $ 7.3 | |||||||||
Principal amount repaid | 310 | 49 | ||||||||
(Loss) gain on extinguishment of debt, net | $ 2.7 | $ 28.3 | ||||||||
Effective interest rate | 7.60% | 7.60% | ||||||||
LIBOR floor rate | 1.00% |
INDEBTEDNESS AND BORROWING FA_5
INDEBTEDNESS AND BORROWING FACILITY - Revolving Credit Facility (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Feb. 22, 2018 | |
Revolving credit facility | ||
Revolving Credit Facility | ||
Revolving credit | $ 0 | |
Credit facility sub limit amount | 50 | |
Maximum borrowing capacity | $ 250 | |
Minimum credit facility percentage | 10.00% | |
Minimum maintained credit facility | $ 12.5 | |
Fixed coverage ratio | 1.00% | |
Maximum availability under the credit facility | $ 113.2 | |
Maximum borrowing credit facility | $ 106.1 | |
Revolving credit facility | Minimum | ||
Revolving Credit Facility | ||
Margin rate | 1.75% | |
Percentage of commitment fee | 0.25% | |
Revolving credit facility | Maximum | ||
Revolving Credit Facility | ||
Margin rate | 2.00% | |
Percentage of commitment fee | 0.375% | |
Revolving credit facility | LIBOR | ||
Revolving Credit Facility | ||
Interest borrowing on credit facility | LIBOR | |
Revolving credit facility | Wells Fargo, N.A | ||
Revolving Credit Facility | ||
Maximum borrowing capacity | $ 250 | |
Letter of Credit | ||
Revolving Credit Facility | ||
Revolving credit | $ 7.1 |
INDEBTEDNESS AND BORROWING FA_6
INDEBTEDNESS AND BORROWING FACILITY - Maturities of Long-term Debt (Details) $ in Millions | Dec. 31, 2018USD ($) |
INDEBTEDNESS AND BORROWING FACILITY | |
2,021 | $ 121 |
2,022 | 386.9 |
Total principal amount of long-term debt | $ 507.9 |
STOCKHOLDERS_ EQUITY (DEFICIT)
STOCKHOLDERS’ EQUITY (DEFICIT) (Details) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Subsidiary, Sale of Stock | |
Shares sold by existing shareholder | 4.3 |
Net proceeds from issuance of common stock | $ | $ 303 |
Conversion ratio | 69.258777 |
IPO | |
Subsidiary, Sale of Stock | |
Total number of shares sold | 22.4 |
Issuance of common stock (in shares) | 18.1 |
Share price | $ / shares | $ 18 |
Net proceeds from issuance of common stock | $ | $ 303 |
Convertible preferred stock conversion ratio | 155.944841 |
Common stock holding percentage prior to IPO | 7.00% |
Recapitalization of convertible preferred stock to common stock (in shares) | 39.4 |
STOCKHOLDERS_ EQUITY (DEFICIT_2
STOCKHOLDERS’ EQUITY (DEFICIT) - Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | |
Sep. 30, 2012 | Dec. 31, 2018 | Dec. 31, 2017 | |
Aggregate consideration on sale of shares | |||
Internal rate of return on investment | 25.00% | ||
Estimated accreted amount | 1,132.7 | $ 1,132.7 | |
Qualified IPO for Preferred stock | |||
Aggregate proceeds | $ 303 | ||
Additional amount on redemption of preferred stock equal to outstanding equity value divided by number of preferred stock (as a percentage) | 20.00% | ||
Series A convertible preferred stock | |||
Preferred stock, issued (in shares) | 350,000 | ||
Par value (per share) | $ 0.01 | ||
Aggregate consideration on sale of shares | $ 350 | ||
Net proceeds | 349.8 | ||
Stock issuance costs | $ 0.2 | ||
Number of common stock equivalents attributable to convertible preferred stock | 2,573 | ||
IPO | |||
Qualified IPO for Preferred stock | |||
Aggregate proceeds | $ 303 | ||
IPO | Minimum | Series A convertible preferred stock | |||
Qualified IPO for Preferred stock | |||
Aggregate proceeds | $ 250 | ||
Split-adjusted price (per share) | $ 1.50 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Stock-based compensation expense | $ 18.9 | $ 0 | $ 0 | ||
2018 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares authorized for grant | 2,800 | ||||
2018 Plan | RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Vesting percentage | 25.00% | ||||
Vesting period | 4 years | ||||
Stock-based compensation expense | $ 15.2 | ||||
Weighted-average grant-date fair value | $ 19.67 | ||||
Unrecognized compensation cost | $ 37.6 | ||||
Weighted average period | 3 years 2 months 12 days | ||||
Unvested restricted stock awards | 2,440 | ||||
2014 LTIP | RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares authorized for grant | 55,000 | ||||
Vesting percentage | 50.00% | 50.00% | |||
2014 LTIP | Stock Settled RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Stock-based compensation expense | $ 2 | ||||
2014 LTIP | Cash Settled RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Stock-based compensation expense | $ 1.7 |
STOCK-BASED COMPENSATION - Rest
STOCK-BASED COMPENSATION - Restricted Stock Unit (Details) - RSUs - 2018 Plan shares in Thousands | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
Number of Units | |
Granted | shares | 3,000 |
Vested | shares | (250) |
Forfeited | shares | (310) |
Ending Balance | shares | 2,440 |
Weighted-Average Grant Date Fair Value | |
Granted | $ / shares | $ 19.67 |
Vested | $ / shares | 19.90 |
Forfeited | $ / shares | 19.90 |
Ending Balance | $ / shares | $ 19.62 |
STOCK-BASED COMPENSATION - Addi
STOCK-BASED COMPENSATION - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Stock-based compensation expense | $ 18.9 | $ 0 | $ 0 |
Income tax benefit for all share based compensation expense | 3.8 | ||
2018 Plan | RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Unrecognized compensation cost | $ 37.6 | ||
Shares available for grants | 131,000 | ||
Number of options outstanding | 2,440,000 | ||
Stock-based compensation expense | $ 15.2 | ||
Fair value of vestred awards | $ 5 |
RETIREMENT PLAN (Details)
RETIREMENT PLAN (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Contribution Plan | |||
Matching contribution by employer | $ 4.1 | $ 1.5 | $ 0 |
Maximum | |||
Defined Contribution Plan | |||
Matching contribution as a percentage | 100.00% | ||
Minimum | |||
Defined Contribution Plan | |||
Matching contribution as a percentage | 0.00% |
IMPAIRMENTS AND OTHER CHARGES -
IMPAIRMENTS AND OTHER CHARGES - Summary of Impairments and Other Charges (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Impairments and other charges | |||||||||||
Supply commitment charges | $ 19.2 | $ 1.2 | $ 2.5 | ||||||||
Impairment of assets | 7 | ||||||||||
Lease abandonment charges | 0.6 | 2 | |||||||||
Employee severance costs | 0.8 | ||||||||||
Total impairments and other charges | $ 3.2 | $ 10 | $ 4 | $ 2 | $ 0.4 | $ 0.1 | $ 1.2 | $ 0.1 | 19.2 | $ 1.8 | $ 12.3 |
Subsequent inventory firm purchase commitment loss recorded in current period | $ 12 |
IMPAIRMENTS AND OTHER CHARGES_2
IMPAIRMENTS AND OTHER CHARGES - Impairment of Assets and Goodwill (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Impairment of assets identified to sell or no longer in use | $ 7 |
Service equipment and real property | |
Impairment of assets identified to sell or no longer in use | $ 7 |
IMPAIRMENTS AND OTHER CHARGES_3
IMPAIRMENTS AND OTHER CHARGES - Lease Abandonment Charges (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Leases | ||
Lease abandonment charges | $ 0.6 | $ 2 |
IMPAIRMENTS AND OTHER CHARGES_4
IMPAIRMENTS AND OTHER CHARGES - Employee Severance Costs (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Restructuring Charges | |
Employee severance costs | $ 0.8 |
ASSET DISPOSALS (Details)
ASSET DISPOSALS (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |
Feb. 29, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |||
Proceeds from sale of property and equipment | $ 4.1 | $ 23.5 | |
Net gain (loss) on sale of property and equipment | $ 1.4 | $ (1.3) | |
Proceeds from sale of transportation equipment and related inventory | $ 8 | ||
Gain on sale of transportation equipment and related inventory | $ 0.3 |
GAIN ON INSURANCE RECOVERIES (D
GAIN ON INSURANCE RECOVERIES (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Jan. 31, 2017 | Jan. 31, 2016 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Gain on insurance recoveries | ||||||
Proceeds from insurance recoveries | $ 4.2 | $ 19 | $ 4.2 | $ 19 | ||
Gain on insurance recoveries | $ 2.9 | $ 15.1 | $ 0.3 | $ 2.6 | $ 2.9 | $ 15.1 |
INCOME TAXES - Components of in
INCOME TAXES - Components of income tax expense (benefit) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current: | |||||||||||
State | $ 2 | $ 1.6 | $ (1.6) | ||||||||
Total current | 2 | 1.6 | (1.6) | ||||||||
Income tax expense (benefit) | $ (0.1) | $ 0.2 | $ 0.9 | $ 1 | $ 0.7 | $ 0.4 | $ 0.4 | $ 0.1 | $ 2 | $ 1.6 | $ (1.6) |
INCOME TAXES - Income tax recon
INCOME TAXES - Income tax reconciliation (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 36 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | |
Income tax expense (benefit) reconciliation | ||||||||||||
Income (loss) before income taxes | $ 26.4 | $ 49.8 | $ 104.5 | $ 79.7 | $ 93.6 | $ 84 | $ 44.7 | $ (20) | $ 260.4 | $ 202.3 | $ (190.1) | $ 272.6 |
Statutory federal income tax rate (as a percent) | 21.00% | 35.00% | 35.00% | |||||||||
Federal income tax expense (benefit) at statutory rate | $ 54.7 | $ 70.8 | $ (66.5) | |||||||||
State income tax expense (benefit), net of federal effect | 5.5 | 7.2 | (6.7) | |||||||||
Effect of changes in income apportionment amongst states | 6.1 | 8.2 | ||||||||||
Effect of U.S. tax law change | 424.8 | |||||||||||
Other items, net | 0.2 | 1.7 | 0.1 | |||||||||
Change in valuation allowance | (64.5) | (511.1) | 71.5 | |||||||||
Income tax expense (benefit) | $ (0.1) | $ 0.2 | $ 0.9 | $ 1 | $ 0.7 | $ 0.4 | $ 0.4 | $ 0.1 | $ 2 | $ 1.6 | $ (1.6) | |
Effective tax rate (as a percent) | 0.80% | 0.80% | 0.80% | |||||||||
Additional tax expense on remeasurement of deferred tax assets | $ 424.8 |
INCOME TAXES - Deferred tax ass
INCOME TAXES - Deferred tax assets and deferred tax liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||||
Goodwill and intangible assets | $ 313 | $ 365.3 | ||
Federal net operating loss carryforwards | 319.4 | 338 | ||
State net operating loss carryforwards, net of federal benefit | 41 | 39.7 | ||
Accrued liabilities | 5.7 | 4.5 | ||
Stock-based compensation | 2.4 | |||
Other | 1.8 | 2.3 | ||
Gross deferred tax assets | 683.3 | 749.8 | ||
Valuation allowance | (671) | (735.5) | $ (1,246.6) | $ (1,175.1) |
Total deferred tax assets | 12.3 | 14.3 | ||
Deferred tax liabilities: | ||||
Property, plant, and equipment | 12.3 | 14.3 | ||
Total deferred tax liabilities | $ 12.3 | $ 14.3 |
INCOME TAXES - Operating loss c
INCOME TAXES - Operating loss carryforwards (Details) $ in Millions | Dec. 31, 2018USD ($) |
Federal | |
Operating loss carryforwards | |
Net operating loss carryforwards | $ 1,520 |
INCOME TAXES - Valuation allowa
INCOME TAXES - Valuation allowance (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of the valuation allowance for deferred tax assets | |||
Balance, beginning | $ 735.5 | $ 1,246.6 | $ 1,175.1 |
Additions | 71.5 | ||
Deductions | (64.5) | (511.1) | |
Balance, ending | $ 671 | $ 735.5 | $ 1,246.6 |
INCOME TAXES - Cumulative incom
INCOME TAXES - Cumulative income before income taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 36 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | |
INCOME TAXES | ||||||||||||
Cumulative income before income taxes | $ 26.4 | $ 49.8 | $ 104.5 | $ 79.7 | $ 93.6 | $ 84 | $ 44.7 | $ (20) | $ 260.4 | $ 202.3 | $ (190.1) | $ 272.6 |
Deductible temporary differences | 683.3 | $ 749.8 | 683.3 | $ 749.8 | 683.3 | |||||||
Minimum | ||||||||||||
INCOME TAXES | ||||||||||||
Deductible temporary differences | $ 1,300 | $ 1,300 | $ 1,300 |
INCOME TAXES - Unrecognized inc
INCOME TAXES - Unrecognized income tax benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reconciliation of unrecognized income tax benefits | |||
Balance, beginning | $ 1.4 | ||
Lapse in applicable statute of limitations | $ (1.4) | ||
Unrecognized income tax benefits | |||
Amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate | $ 0 | $ 0 | |
Accrued interest expense with unrecognized tax benefits | 0 | 0 | |
Interest expense associated with unrecognized tax benefits | $ 0 | $ 0 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | Feb. 22, 2019 | Nov. 12, 2018 | Jul. 19, 2018 | Jun. 30, 2015 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Future minimum rental commitments due in | |||||||
Total rental expenses | $ 49.9 | $ 26.8 | $ 19.6 | ||||
2,019 | 26 | ||||||
2,020 | 14.9 | ||||||
2,021 | 4.6 | ||||||
2,022 | 1.5 | ||||||
2,023 | 1.5 | ||||||
Thereafter | 1.1 | ||||||
Purchase obligations due | |||||||
Purchases made under agreement | 33.8 | $ 38.8 | $ 20.9 | ||||
2,019 | 56.5 | ||||||
2,020 | 51.6 | ||||||
2,021 | 48.3 | ||||||
2,022 | 47.9 | ||||||
2,023 | 47.9 | ||||||
Thereafter | $ 47.9 | ||||||
Patterson Case | |||||||
Litigation | |||||||
Damages sought | $ 1 | ||||||
Damages awarded value | $ 33 | $ 100 | |||||
Subsequent Event | Glock Case | |||||||
Litigation | |||||||
Damages sought | $ 1 | ||||||
Maximum | |||||||
Purchase obligations due | |||||||
Duration of purchase agreement (in years) | 6 years | ||||||
Minimum | |||||||
Purchase obligations due | |||||||
Duration of purchase agreement (in years) | 1 year |
NONRECURRING FAIR VALUE MEASU_3
NONRECURRING FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | $ 743.7 | $ 831 | |
Fair value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | $ 6.4 | ||
Fair value | Long-lived assets held for sale | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 6.4 | ||
Fair value | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 6.4 | ||
Fair value | Level 3 | Long-lived assets held for sale | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 6.4 | ||
Carrying value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 13.4 | ||
Carrying value | Property no longer used | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 1 | ||
Carrying value | Long-lived assets held for sale | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | $ 12.4 |
EARNINGS (LOSS) PER SHARE (Deta
EARNINGS (LOSS) PER SHARE (Details) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018USD ($)$ / shares | Sep. 30, 2018USD ($)$ / shares | Jun. 30, 2018USD ($)$ / shares | Mar. 31, 2018USD ($)$ / shares | Dec. 31, 2017USD ($)$ / shares | Sep. 30, 2017USD ($)$ / shares | Jun. 30, 2017USD ($)$ / shares | Mar. 31, 2017USD ($)$ / shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | |
Numerator: | |||||||||||
Net income (loss) | $ 26.5 | $ 49.6 | $ 103.6 | $ 78.7 | $ 92.9 | $ 83.6 | $ 44.3 | $ (20.1) | $ 258.4 | $ 200.7 | $ (188.5) |
Convertible preferred stock accretion | (226.6) | (181.6) | |||||||||
Net reversal of convertible preferred stock accretion due to recapitalization of convertible preferred stock to common stock | 423.2 | ||||||||||
Net income (loss) attributable to common stockholders used for basic EPS computation | $ 26.5 | $ 49.6 | $ 103.6 | $ 501.9 | $ 30.9 | $ 25.1 | $ (10.5) | $ (71.4) | 681.6 | (25.9) | (370.1) |
Add back the effect of dilutive securities: | |||||||||||
Net income (loss) attributable to common stockholders used for diluted EPS computation | $ 681.6 | $ (25.9) | $ (370.1) | ||||||||
Denominator: | |||||||||||
Weighted average shares used for basic EPS computation | shares | 104,200,000 | 51,800,000 | 51,800,000 | ||||||||
Effect of dilutive securities: | |||||||||||
Number of shares used for diluted EPS computation | shares | 104,200,000 | 51,800,000 | 51,800,000 | ||||||||
Basic and diluted EPS | $ / shares | $ 0.24 | $ 0.45 | $ 0.95 | $ 5.68 | $ 0.60 | $ 0.48 | $ (0.20) | $ (1.38) | $ 6.54 | $ (0.50) | $ (7.14) |
Reverse stock split ratio | 69.258777 | ||||||||||
Estimated accreted amount | $ 1,132.7 | $ 1,132.7 | $ 1,132.7 | $ 1,132.7 | |||||||
Recapitalization of convertible preferred stock to common stock | $ 349.8 | ||||||||||
IPO | |||||||||||
Effect of dilutive securities: | |||||||||||
Recapitalization of convertible preferred stock to common stock (in shares) | shares | 39,400,000 | ||||||||||
Recapitalization of convertible preferred stock to common stock | $ 709.5 | ||||||||||
Share price | $ / shares | $ 18 | $ 18 | |||||||||
RSUs | |||||||||||
Effect of dilutive securities: | |||||||||||
Common stock equivalents | shares | 2,400,000 | 117,000 | 159,000 | ||||||||
Convertible preferred stock | |||||||||||
Effect of dilutive securities: | |||||||||||
Common stock equivalents | shares | 13,000,000 | 13,000,000 |
SELECTED QUARTERLY DATA (UNAU_3
SELECTED QUARTERLY DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | 36 Months Ended | ||||||||||
Jan. 31, 2017 | Jan. 31, 2016 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | |
Revenue | ||||||||||||||
Revenue | $ 248.1 | $ 324.4 | $ 454.6 | $ 423.3 | $ 446.6 | $ 409.8 | $ 304.4 | $ 191.9 | $ 1,450.4 | $ 1,352.7 | $ 529.5 | |||
Revenue from related parties | 10 | 38.7 | 44.2 | 12.1 | 39.2 | 40.5 | 21.6 | 92.9 | 113.4 | 2.7 | ||||
Total revenue | 248.1 | 334.4 | 493.3 | 467.5 | 458.7 | 449 | 344.9 | 213.5 | 1,543.3 | 1,466.1 | 532.2 | |||
Operating Costs and Expenses [Abstract] | ||||||||||||||
Costs of revenue | 169.4 | 222.2 | 329.4 | 312.2 | 299.9 | 298.8 | 236.3 | 174.8 | 1,033.2 | 1,009.8 | 510.5 | |||
Selling, general and administrative | 21.6 | 19.7 | 20.8 | 25.8 | 19 | 21.7 | 20.8 | 19.5 | 87.9 | 81 | 64.4 | |||
Depreciation and amortization | 22.3 | 21.1 | 20.7 | 20.6 | 21.4 | 22.1 | 21.3 | 21.8 | 84.7 | 86.6 | 112.6 | |||
Impairments and other charges | 3.2 | 10 | 4 | 2 | 0.4 | 0.1 | 1.2 | 0.1 | 19.2 | 1.8 | 12.3 | |||
(Gain) loss on disposal of assets, net | (0.3) | (0.1) | (0.2) | 0.5 | 0.2 | (0.8) | (0.4) | (0.4) | (0.1) | (1.4) | 1 | |||
Gain on insurance recoveries | $ (2.9) | $ (15.1) | (0.3) | (2.6) | (2.9) | (15.1) | ||||||||
Total operating expenses | 216.2 | 272.9 | 374.7 | 361.1 | 340.9 | 341.9 | 278.9 | 213.2 | 1,224.9 | 1,174.9 | 685.7 | |||
Operating income (loss) | 31.9 | 61.5 | 118.6 | 106.4 | 117.8 | 107.1 | 66 | 0.3 | 318.4 | 291.2 | (153.5) | |||
Interest expense, net | (9.4) | (10.4) | (12.1) | (17.4) | (21.9) | (22.1) | (21.5) | (21.2) | (49.3) | (86.7) | (87.5) | |||
(Loss) gain on extinguishment of debt, net | 0.9 | (0.6) | (0.8) | (9.3) | (1.4) | (9.8) | (1.4) | 53.7 | ||||||
Equity in net income (loss) of joint venture affiliate | 3 | (0.7) | (1.2) | (0.9) | (1) | 0.2 | 0.9 | 1.1 | (0.8) | (2.8) | ||||
Income (loss) before income taxes | 26.4 | 49.8 | 104.5 | 79.7 | 93.6 | 84 | 44.7 | (20) | 260.4 | 202.3 | (190.1) | $ 272.6 | ||
Income tax expense (benefit) | (0.1) | 0.2 | 0.9 | 1 | 0.7 | 0.4 | 0.4 | 0.1 | 2 | 1.6 | (1.6) | |||
Net income (loss) | 26.5 | 49.6 | 103.6 | 78.7 | 92.9 | 83.6 | 44.3 | (20.1) | 258.4 | 200.7 | (188.5) | |||
Net income (loss) attributable to common stockholders | $ 26.5 | $ 49.6 | $ 103.6 | $ 501.9 | $ 30.9 | $ 25.1 | $ (10.5) | $ (71.4) | $ 681.6 | $ (25.9) | $ (370.1) | |||
Basic and diluted earnings (loss) per share attributable to common stockholders | $ 0.24 | $ 0.45 | $ 0.95 | $ 5.68 | $ 0.60 | $ 0.48 | $ (0.20) | $ (1.38) | $ 6.54 | $ (0.50) | $ (7.14) | |||
Shares used in computing basic and diluted earnings (loss) per share | 109.4 | 109.3 | 109.3 | 88.4 | 51.8 | 51.8 | 51.8 | 51.8 | 104.2 | 51.8 | 51.8 |