Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 25, 2018 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | EVERTEC, Inc. | |
Trading Symbol | EVTC | |
Entity Central Index Key | 1,559,865 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding (in shares) | 72,741,417 |
Unaudited Consolidated Condense
Unaudited Consolidated Condensed Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current Assets: | ||
Cash and cash equivalents | $ 91,310 | $ 50,423 |
Restricted cash | 12,686 | 9,944 |
Accounts receivable, net | 82,865 | 83,328 |
Prepaid expenses and other assets | 29,671 | 25,011 |
Total current assets | 216,532 | 168,706 |
Investment in equity investee | 12,039 | 13,073 |
Property and equipment, net | 36,655 | 37,924 |
Goodwill | 396,035 | 398,575 |
Other intangible assets, net | 260,744 | 279,961 |
Deferred tax asset | 1,093 | 988 |
Other long-term assets | 5,500 | 3,561 |
Total assets | 928,598 | 902,788 |
Current Liabilities: | ||
Accrued liabilities | 45,174 | 38,451 |
Accounts payable | 37,397 | 41,135 |
Unearned income | 14,017 | 7,737 |
Income tax payable | 5,684 | 1,406 |
Current portion of long-term debt | 23,191 | 46,487 |
Short-term borrowings | 0 | 12,000 |
Total current liabilities | 125,463 | 147,216 |
Long-term debt | 541,949 | 557,251 |
Deferred tax liability | 11,509 | 13,820 |
Unearned income - long term | 24,217 | 23,486 |
Other long-term liabilities | 10,508 | 13,039 |
Total liabilities | 713,646 | 754,812 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity | ||
Preferred stock, par value $0.01; 2,000,000 shares authorized; none issued | 0 | 0 |
Common stock, par value $0.01; 206,000,000 shares authorized; 72,740,277 shares issued and outstanding at September 30, 2018 (December 31, 2017 - 72,393,933) | 727 | 723 |
Additional paid-in capital | 12,910 | 5,350 |
Accumulated earnings | 212,180 | 148,887 |
Accumulated other comprehensive loss, net of tax | (14,964) | (10,848) |
Total EVERTEC, Inc. stockholders’ equity | 210,853 | 144,112 |
Non-controlling interest | 4,099 | 3,864 |
Total equity | 214,952 | 147,976 |
Total liabilities and equity | $ 928,598 | $ 902,788 |
Unaudited Consolidated Conden_2
Unaudited Consolidated Condensed Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock issued (in shares) | 0 | 0 |
Common stock par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 206,000,000 | 206,000,000 |
Common stock issued (in shares) | 72,740,277 | 72,393,933 |
Common stock outstanding (in shares) | 72,740,277 | 72,393,933 |
Unaudited Consolidated Conden_3
Unaudited Consolidated Condensed Statements of Income and Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Statement [Abstract] | ||||
Revenues | $ 112,017 | $ 102,725 | $ 335,638 | $ 307,516 |
Revenues | 112,017 | 102,725 | 335,638 | 307,516 |
Operating costs and expenses | ||||
Cost of revenues, exclusive of depreciation and amortization shown below | 49,464 | 62,699 | 146,015 | 149,902 |
Selling, general and administrative expenses | 14,404 | 14,612 | 45,684 | 40,031 |
Depreciation and amortization | 15,788 | 16,606 | 47,383 | 48,189 |
Total operating costs and expenses | 79,656 | 93,917 | 239,082 | 238,122 |
Income from operations | 32,361 | 8,808 | 96,556 | 69,394 |
Non-operating income (expenses) | ||||
Interest income | 205 | 159 | 526 | 560 |
Interest expense | (7,557) | (8,012) | (22,901) | (22,454) |
Earnings of equity method investment | 238 | 155 | 612 | 413 |
Other income, net | 1,130 | 192 | 1,878 | 2,829 |
Total non-operating expenses | (5,984) | (7,506) | (19,885) | (18,652) |
Income before income taxes | 26,377 | 1,302 | 76,671 | 50,742 |
Income tax expense (benefit) | 3,302 | (4,840) | 10,349 | 1,248 |
Net income | 23,075 | 6,142 | 66,322 | 49,494 |
Less: Net income attributable to non-controlling interest | 78 | 40 | 251 | 274 |
Net income attributable to EVERTEC, Inc.’s common stockholders | 22,997 | 6,102 | 66,071 | 49,220 |
Other comprehensive income (loss), net of tax of $180, $2, $348 and $21 | ||||
Foreign currency translation adjustments | (4,325) | 2,083 | (6,225) | (518) |
Gain on cash flow hedge | 219 | 381 | 2,109 | 757 |
Total comprehensive income attributable to EVERTEC, Inc.’s common stockholders | $ 18,891 | $ 8,566 | $ 61,955 | $ 49,459 |
Net income per common share - basic attributable to EVERTEC, Inc.’s common stockholders (in usd per share) | $ 0.32 | $ 0.08 | $ 0.91 | $ 0.68 |
Net income per common share - diluted attributable to EVERTEC, Inc.’s common stockholders (in usd per share) | 0.31 | 0.08 | 0.89 | 0.67 |
Cash dividends declared per share (in usd per share) | $ 0.05 | $ 0.10 | $ 0.05 | $ 0.3 |
Unaudited Consolidated Conden_4
Unaudited Consolidated Condensed Statements of Income and Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Statement [Abstract] | ||||
Other comprehensive income, income tax (benefit) expense | $ 180 | $ 2 | $ 348 | $ 21 |
Unaudited Consolidated Conden_5
Unaudited Consolidated Condensed Statement of Changes in Stockholders' Equity - 9 months ended Sep. 30, 2018 - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Earnings | Accumulated Other Comprehensive Loss | Non-Controlling Interest |
Beginning balance (in shares) at Dec. 31, 2017 | 72,393,933 | 72,393,933 | ||||
Beginning balance at Dec. 31, 2017 | $ 147,976 | $ 723 | $ 5,350 | $ 148,887 | $ (10,848) | $ 3,864 |
Cumulative adjustment from implementation of ASC 606 at Dec. 31, 2017 | 842 | 858 | (16) | |||
Changes in Stockholders’ Equity | ||||||
Share-based compensation recognized | 9,692 | 9,692 | ||||
Restricted stock units delivered, net of cashless (in shares) | 346,344 | |||||
Restricted stock units delivered, net of cashless | (2,128) | $ 4 | (2,132) | |||
Net income | 66,322 | 66,071 | 251 | |||
Cash dividends declared on common stock | (3,636) | (3,636) | ||||
Other comprehensive loss | $ (4,116) | (4,116) | ||||
Ending balance (in shares) at Sep. 30, 2018 | 72,740,277 | 72,740,277 | ||||
Ending balance at Sep. 30, 2018 | $ 214,952 | $ 727 | $ 12,910 | $ 212,180 | $ (14,964) | $ 4,099 |
Unaudited Consolidated Conden_6
Unaudited Consolidated Condensed Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash flows from operating activities | ||
Net income | $ 66,322 | $ 49,494 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 47,383 | 48,189 |
Amortization of debt issue costs and accretion of discount | 3,410 | 3,828 |
Provision for doubtful accounts and sundry losses | 1,065 | 452 |
Deferred tax benefit | (2,734) | (6,338) |
Share-based compensation | 9,692 | 6,579 |
Loss on impairment of software | 0 | 6,473 |
Loss on disposition of property and equipment and other intangibles | 12 | 229 |
Earnings of equity method investment | (612) | (413) |
Dividend received from equity method investment | 390 | 0 |
(Increase) decrease in assets: | ||
Accounts receivable, net | (64) | 5,446 |
Prepaid expenses and other assets | (4,462) | (3,813) |
Other long-term assets | (280) | 1,447 |
(Decrease) increase in liabilities: | ||
Accounts payable and accrued liabilities | (3,674) | (9,127) |
Income tax payable | 4,278 | 2,990 |
Unearned income | 7,655 | 4,570 |
Other long-term liabilities | 62 | (1,571) |
Total adjustments | 62,121 | 58,941 |
Net cash provided by operating activities | 128,443 | 108,435 |
Cash flows from investing activities | ||
Additions to software | (15,385) | (15,955) |
Acquisitions, net of cash acquired | 0 | (42,836) |
Property and equipment acquired | (9,620) | (8,285) |
Proceeds from sales of property and equipment | 15 | 30 |
Net cash used in investing activities | (24,990) | (67,046) |
Cash flows from financing activities | ||
Statutory withholding taxes paid on share-based compensation | (2,128) | (1,576) |
Net (decrease) increase in short-term borrowings | (12,000) | 5,000 |
Repayment of short-term borrowing for purchase of equipment and software | (686) | (1,872) |
Dividends paid | (3,636) | (21,762) |
Repurchase of common stock | 0 | (7,671) |
Repayment of long-term debt | (41,374) | (14,748) |
Net cash used in financing activities | (59,824) | (42,629) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 43,629 | (1,240) |
Cash, cash equivalents and restricted cash at beginning of the period | 60,367 | 60,032 |
Cash, cash equivalents and restricted cash at end of the period | 103,996 | 58,792 |
Reconciliation of cash, cash equivalents and restricted cash | ||
Cash and cash equivalents | 91,310 | 48,440 |
Restricted cash | 12,686 | 10,352 |
Cash, cash equivalents and restricted cash | 60,367 | 60,032 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 19,923 | 18,991 |
Cash paid for income taxes | 7,150 | 7,493 |
Supplemental disclosure of non-cash activities: | ||
Payable due to vendor related to software acquired | $ 330 | $ 1,420 |
The Company and Basis of Presen
The Company and Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
The Company and Basis of Presentation | The Company and Basis of Presentation The Company EVERTEC, Inc. (formerly known as Carib Latam Holdings, Inc.) and its subsidiaries (collectively the “Company,” or “EVERTEC”) is a leading full-service transaction processing business in Latin America and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment processing and business process management. The Company provides services across 26 countries in the region. EVERTEC owns and operates the ATH network, one of the leading automated teller machine (“ATM”) and personal identification number (“PIN”) debit networks in Latin America. In addition, EVERTEC provides a comprehensive suite of services for core bank processing, cash processing and technology outsourcing in the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations and government agencies with solutions that are essential to their operations, enabling them to issue, process and accept transactions securely. Basis of Presentation The unaudited consolidated condensed financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of the accompanying unaudited consolidated condensed financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited consolidated condensed financial statements. Actual results could differ from these estimates. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted from these statements pursuant to the rules and regulations of the SEC and, accordingly, these consolidated condensed financial statements should be read in conjunction with the Audited Consolidated Financial Statements of the Company for the year ended December 31, 2017 , included in the Company’s 2017 Form 10-K. In the opinion of management, the accompanying consolidated condensed financial statements, prepared in accordance with GAAP, contain all adjustments necessary for a fair presentation. Intercompany accounts and transactions are eliminated in consolidation. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently issued accounting pronouncements In August 2018, the Financial Accounting Standards Board ("FASB") issued an updated disclosure framework for fair value measurements. The amendments in the issued update remove, modify and add disclosure requirements on fair value measurements in Topic 820 Fair Value Measurements. The amendments in this update are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Certain amendments in the update should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented. Early adoption is permitted upon issuance of this update. An entity is permitted to early adopt any removed or modified disclosures upon issuance of this update and delay adoption of the additional disclosures until their effective date. The Company is currently evaluating the impact of the adoption of this update on the notes to the consolidated financial statements. In August 2018, the FASB issued updated guidance for customer's accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The amendments in this update should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is currently evaluating the impact of the adoption of this update to the consolidated financial statements. Accounting pronouncements issued prior to 2018 and not yet adopted During 2016, the FASB issued a new standard related to Topic 842 Leases to increase transparency and comparability among organizations by recognizing Right of Use ("ROU") assets and lease liabilities on the balance sheet for all leases, other than leases that meet the definition of a short term lease, notwithstanding the lease classification. Under the standard, organizations are required to provide disclosures with the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. In July 2018, the FASB issued Accounting Standards Update ("ASU") 2018-10 and ASU 2018-11, to amend narrow aspects of the standard, to add a new and optional transition method for the adoption of the new standard and provide lessors with a practical expedient, among others. The Company will apply Accounting Standards Codification ("ASC") Topic 842 at the adoption date in accordance with the new and optional transition method available, as well as the package of practical expedients and the use of hindsight practical expedient available for transition. Accordingly, upon transition, the Company will account for its existing leases without reassessing (a) whether the contract contains a lease under ASC Topic 842, (b) whether the lease classification should be different in accordance with ASC Topic 842, or (c) whether initial direct costs before transition would have met the definition of the new leasing standard. In addition, the Company will recognize an ROU asset and a lease liability for all operating leases in its balance sheet. For financing leases, the Company will change the characterization of the asset (to an ROU asset) and the obligation (to a lease liability). The Company will not restate comparative periods. The Company is in the process of calculating the impact of the recognition of ROU assets and lease liabilities for operating leases, which is the most significant impact expected, assessing the potential impact of the new standards in other accounting areas and designing the internal controls to be implemented with the adoption of ASC Topic 842. During 2016, the FASB issued updated guidance for the measurement of credit losses on financial instruments. The amendments in this update require a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset or assets to present the net carrying value at the amount expected to be collected on the financial asset. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. The Company expects to adopt this guidance in the fiscal period required by this update and continues to evaluate if the adoption will have an impact on the consolidated financial statements. In August 2017, the FASB issued updated guidance to improve accounting for hedging activities. The amendments in this update better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amendments in this update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported and also include certain targeted improvements to ease the application of current guidance related to the assessment of hedge effectiveness. The Company expects to adopt this guidance in the required period and continues to evaluate if this update will have an impact on the consolidated financial statements. |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and Equipment, net Property and equipment, net consists of the following: (Dollar amounts in thousands) Useful life September 30, 2018 December 31, 2017 Buildings 30 $ 1,502 $ 1,531 Data processing equipment 3 - 5 109,694 103,426 Furniture and equipment 3 - 20 7,485 232 Leasehold improvements 5 -10 2,595 2,190 121,276 107,379 Less - accumulated depreciation and amortization (85,929 ) (70,793 ) Depreciable assets, net 35,347 36,586 Land 1,308 1,338 Property and equipment, net $ 36,655 $ 37,924 Depreciation and amortization expense related to property and equipment for the three and nine months ended September 30, 2018 amounted to $3.7 million and $10.9 million , respectively, compared to $3.8 million and $11.2 million , respectively, for the same periods in 2017 . |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The changes in the carrying amount of goodwill, allocated by reportable segments, were as follows (See Note 14): (In thousands) Payment Payment Merchant Business Total Balance at December 31, 2017 $ 160,972 $ 53,659 $ 138,121 $ 45,823 $ 398,575 Foreign currency translation adjustments — (2,540 ) — — (2,540 ) Balance at September 30, 2018 $ 160,972 $ 51,119 $ 138,121 $ 45,823 $ 396,035 Goodwill is tested for impairment on an annual basis as of August 31, or more often if events or changes in circumstances indicate there may be impairment. The Company may test for goodwill impairment using a qualitative or a quantitative analysis. In the quantitative analysis, the Company compares the estimated fair value of the reporting units to their carrying values, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired. If the fair value does not exceed the carrying value, an impairment loss equaling the excess amount is recorded, limited to the recorded balance of goodwill. No impairment losses were recognized for the nine months ended September 30, 2018 or 2017 . The carrying amount of other intangible assets at September 30, 2018 and December 31, 2017 was as follows: September 30, 2018 (Dollar amounts in thousands) Useful life in years Gross Accumulated Net carrying Customer relationships 8 - 14 $ 343,276 $ (188,027 ) $ 155,249 Trademark 2 - 15 41,671 (27,996 ) 13,675 Software packages 3 - 10 213,368 (147,933 ) 65,435 Non-compete agreement 15 56,539 (30,154 ) 26,385 Other intangible assets, net $ 654,854 $ (394,110 ) $ 260,744 December 31, 2017 (Dollar amounts in thousands) Useful life in years Gross Accumulated Net carrying Customer relationships 8 - 14 $ 344,175 $ (168,134 ) $ 176,041 Trademark 2 - 15 41,594 (25,241 ) 16,353 Software packages 3 - 10 195,262 (136,907 ) 58,355 Non-compete agreement 15 56,539 (27,327 ) 29,212 Other intangible assets, net $ 637,570 $ (357,609 ) $ 279,961 For the three and nine months ended September 30, 2018 , the Company recorded amortization expense related to other intangibles of $11.9 million and $36.4 million , respectively, compared to $12.7 million and $36.9 million for the corresponding 2017 periods. During the third quarter of 2017 , the Company recognized an impairment charge of $6.5 million through cost of revenues for a third party software solution that was no longer commercially viable. In connection with this exit activity, the Company accrued $5.3 million for ongoing contractual fees, also through cost of revenues and recognized maintenance expense of $1.0 million . Both the liability and the impairment charge affected the Company's Merchant Acquiring segment and Payment Processing segments. The estimated amortization expense of the balances outstanding at September 30, 2018 for the next five years is as follows: (Dollar amounts in thousands) Remaining 2018 $ 12,870 2019 45,128 2020 39,925 2021 35,202 2022 33,132 |
Debt and Short-Term Borrowings
Debt and Short-Term Borrowings | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt and Short-Term Borrowings | Debt and Short-Term Borrowings Total debt at September 30, 2018 and December 31, 2017 follows: (In thousands) September 30, 2018 December 31, 2017 Senior Secured Credit Facility (2018 Term A) due on April 17, 2018 paying interest at a variable interest rate (London InterBank Offered Rate (“LIBOR”) plus applicable margin (1)(3) ) $ — $ 26,690 Senior Secured Credit Facility (2020 Term A) due on January 17, 2020 paying interest at a variable interest rate (LIBOR plus applicable margin (3)(4) ) 189,974 200,653 Senior Secured Credit Facility (Term B) due on April 17, 2020 paying interest at a variable interest rate (LIBOR plus applicable margin (2)(3) ) 375,165 376,395 Senior Secured Revolving Credit Facility (6) — 12,000 Note Payable due on August 31, 2019 (5) — 584 Note Payable due on April 30, 2021 (3) 330 418 Total debt $ 565,469 $ 616,740 (1) Applicable margin of 2.25% at December 31, 2017 . (2) Subject to a minimum rate (“LIBOR floor”) of 0.75% plus applicable margin of 2.50% at September 30, 2018 and December 31, 2017 . (3) Net of unaccreted discount and unamortized debt issue costs, as applicable. (4) Applicable margin of 2.50% at September 30, 2018 and December 31, 2017 . (5) Fixed interest rate of 7.50% . The Company prepaid the outstanding principal balance of this note during the second quarter of 2018 without penalties. (6) Applicable margin of 2.50% at September 30, 2018 and December 31, 2017 . Senior Secured Credit Facilities On April 17, 2013, EVERTEC Group entered into a credit agreement (the “2013 Credit Agreement”) governing the senior secured credit facilities, consisting of a $300.0 million term loan A facility (the “Term A Loan”), a $400.0 million term loan B facility (the “Term B Loan”, together with the Term A Loan, the “Senior Secured term loans”) and a $100.0 million revolving credit facility (the "Revolving Facility"). During 2016, the Company entered into two separate amendments to the 2013 Credit Agreement. In the second quarter of 2016, EVERTEC Group, together with certain other direct and indirect subsidiaries of the Company, entered into a second amendment and waiver to the outstanding 2013 Credit Agreement (the “Second Amendment”). In the fourth quarter of 2016, EVERTEC Group, together with certain other direct and indirect subsidiaries of the Company, entered into a third amendment (the “Third Amendment”) to the 2013 Credit Agreement. The Third Amendment extends the maturity of (a) approximately $219 million of EVERTEC Group’s existing approximately $250 million of Term A loan facility to January 17, 2020 (the “2020 Term A Loan”) and (b) $65 million of EVERTEC Group’s existing $100 million of Revolving Facility to January 17, 2020. The remaining approximately $30 million of Term A loan (the “2018 Term A Loan”) and the $35 million of Revolving Facility were not extended and matured as originally scheduled on April 17, 2018. The Term B Loan will remain in place and mature as originally scheduled on April 17, 2020. The unpaid principal balance at September 30, 2018 of the 2020 Term A Loan and the Term B Loan was $191.4 million and $379.0 million , respectively. At September 30, 2018 , the 2018 Term A Loan had been fully repaid. The additional borrowing capacity for the Revolving Facility at September 30, 2018 was $65.0 million . Notes payable In May 2016, EVERTEC Group entered into a non-interest bearing financing agreement amounting to $0.7 million and in October 2016 entered into an interest bearing agreement of $1.1 million , to purchase software. As of September 30, 2018 and December 31, 2017 , the outstanding principal balance of the notes payable is $0.4 million and $1.0 million , respectively. The October 2016 interest bearing note payable outstanding principal balance was prepaid without penalties during the second quarter of 2018. The current portion of these notes is recorded as part of accounts payable and the long-term portion is included in other long-term liabilities. Interest Rate Swap As of September 30, 2018 , the Company has the following interest rate swap agreement converting a portion of the interest rate exposure on the Company's Term B Loan from variable to fixed: Effective date Maturity Date Notional Amount Variable Rate Fixed Rate January 2017 April 2020 $200 million 1-month LIBOR 1.9225% The Company has accounted for this transaction as a cash flow hedge. The fair value of the Company’s derivative instrument is determined using a standard valuation model. The significant inputs used in this model are readily available in public markets, or can be derived from observable market transactions, and therefore have been classified as Level 2 within the fair value hierarchy. Inputs used in this standard valuation model for derivative instruments include the applicable forward rates and discount rates. The discount rates are based on the historical LIBOR Swap rates. At September 30, 2018 and December 31, 2017 , the carrying amount of the derivative on the Company’s balance sheets is as follows: (Dollar amounts in thousands) September 30, 2018 December 31, 2017 Other long-term assets $ 2,546 $ 214 During the nine months ended September 30, 2018 , the Company reclassified losses of $0.1 million from accumulated other comprehensive loss into income through interest expense. Based on current LIBOR rates, the Company expects to reclassify gains of $0.5 million from accumulated other comprehensive loss into income through interest expense over the next 12 months. Refer to Note 6 for tabular disclosure of the fair value of derivatives and to Note 7 for tabular disclosure of gains recorded on cash flow hedging activities. The cash flow hedge is considered highly effective and no impact on earnings is expected due to hedge ineffectiveness. |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments and Fair Value Measurements | Financial Instruments and Fair Value Measurements Recurring Fair Value Measurements Fair value measurement provisions establish a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These provisions describe three levels of input that may be used to measure fair value: Level 1 : Inputs are unadjusted, quoted prices for identical assets or liabilities in an active market at the measurement date. Level 2 : Inputs, other than quoted prices included in Level 1, which are observable for the asset or liability through corroboration with market data at the measurement date. Level 3 : Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The Company uses observable inputs when available. Fair value is based upon quoted market prices when available. If market prices are not available, the Company may employ models that mostly use market-based inputs including yield curves, interest rates, volatilities, and credit curves, among others. The Company limits valuation adjustments to those deemed necessary to ensure that the financial instrument’s fair value adequately represents the price that would be received or paid in the marketplace. Valuation adjustments may include consideration of counterparty credit quality and liquidity as well as other criteria. The estimated fair value amounts are subjective in nature and may involve uncertainties and matters of significant judgment for certain financial instruments. Changes in the underlying assumptions used in estimating fair value could affect the results. The fair value measurement levels are not indicative of risk of investment. The fair value of financial instruments is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value estimates are made at a specific point in time based on the type of financial instrument and relevant market information. Many of these estimates involve various assumptions and may vary significantly from amounts that could be realized in actual transactions. The following table summarizes the fair value measurement by level at September 30, 2018 and December 31, 2017 for the asset measured at fair value on a recurring basis: (In thousands) Level 1 Level 2 Level 3 Total September 30, 2018 Financial asset: Interest rate swap $ — $ 2,546 $ — $ 2,546 December 31, 2017 Financial asset: Interest rate swap $ — $ 214 $ — $ 214 The following table presents the carrying value, as applicable, and estimated fair values for financial instruments at September 30, 2018 and December 31, 2017 : September 30, 2018 December 31, 2017 (In thousands) Carrying Fair Carrying Fair Financial assets: Interest rate swap $ 2,546 $ 2,546 $ 214 $ 214 Financial liabilities: Senior Secured Term B Loan 375,165 378,526 376,395 370,540 2018 Term A Loan — — 26,690 26,027 2020 Term A Loan 189,974 190,640 200,653 196,584 The fair values of the term loans at September 30, 2018 and December 31, 2017 were obtained using the prices provided by third party service providers. Their pricing is based on various inputs such as: market quotes, recent trading activity in a non-active market or imputed prices. Also, the pricing may include the use of an algorithm that could take into account movement in the general high yield market, among other variants. The Senior Secured term loans, which are not measured at fair value in the balance sheets, would be categorized as Level 3 in the fair value hierarchy. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Equity | Equity Accumulated Other Comprehensive Loss The following table provides a summary of the changes in the balances of accumulated other comprehensive loss for the nine months period ended September 30, 2018 : (In thousands) Foreign Currency Cash Flow Hedge Total Balance - December 31, 2017, net of tax $ (11,062 ) $ 214 $ (10,848 ) Other comprehensive (loss) income before reclassifications (6,225 ) 2,023 (4,202 ) Effective portion reclassified to Net Income — 86 86 Balance - September 30, 2018, net of tax $ (17,287 ) $ 2,323 $ (14,964 ) |
Share-based Compensation
Share-based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation | Share-based Compensation Long-term Incentive Plan ("LTIP") In the first quarter of 2016, 2017 and 2018, the Compensation Committee of the Board of Directors approved grants of restricted stock units (“RSUs”) to executives and certain employees pursuant to the 2016 LTIP, 2017 LTIP and 2018 LTIP, respectively, all under the terms of our 2013 Equity Incentive Plan. Additionally, in the fourth quarter of 2017, a special retention grant to certain executives and employees of the Company was approved. Under the LTIPs, the Company granted restricted stock units to eligible participants as time-based awards and/or performance-based awards. The vesting of the RSUs is dependent upon service, market, and/or performance conditions as defined in the grants. Employees that received time-based awards with service conditions are entitled to receive a specific number of shares of the Company’s common stock on the vesting date if the employee is providing services to the Company on the vesting date. Time-based awards vest over a period of three years in substantially equal installments commencing on the grant date and ending on February 19 of each year for the 2016 LTIP, on February 24 of each year for the 2017 LTIP and on February 28 of each year for the 2018 LTIP. Employees that received awards with market conditions under the 2016 LTIP are entitled to receive a specific number of shares of the Company’s common stock on the vesting date if the Company’s total shareholder return (“TSR”) target relative to a specified group of industry peer companies is achieved. Employees that received awards with performance conditions are entitled to receive a specific number of shares of the Company’s common stock on the vesting date if the Cumulative Annual Growth Rate (“CAGR”) of Diluted EPS target over one year is achieved for the 2016 LTIP. The shares earned according to the plan are further subject to a two -year service vesting period. For the performance-based awards under the 2017 LTIP and 2018 LTIP, the Compensation Committee established adjusted earnings before income taxes, depreciation and amortization ("Adjusted EBITDA") as the primary performance measure while maintaining focus on total shareholder return through the use of a market-based TSR performance modifier. The TSR modifier adjusts the shares earned based on the core Adjusted EBITDA performance upwards or downwards (+/- 25% ) based on the Company’s relative TSR at the end of the three -year performance period as compared to the companies in the Russell 2000 Index. The Adjusted EBITDA performance measure will be calculated for the one -year period commencing on January 1 of the year of the grant and ending on December 31 of the same year, relative to the goals set by the Compensation Committee for this same period. The shares earned will be subject to a further two -year service vesting period. Performance and market-based awards vest at the end of the performance period that commenced on February 19, 2016 for the 2016 LTIP, February 24, 2017 for the 2017 LTIP and February 28, 2018 for the 2018 LTIP. The periods end on February 19, 2019 for the 2016 LTIP, February 24, 2020 for the 2017 LTIP and February 28, 2021 for the 2018 LTIP. Awards are forfeited if the employee voluntarily ceases to be employed by the Company prior to vesting. The following table summarizes nonvested restricted shares and RSUs activity for the nine months ended September 30, 2018 : Nonvested restricted shares and RSUs Shares Weighted-average Nonvested at December 31, 2017 2,340,892 $ 15.08 Forfeited (382,371 ) 17.32 Vested (461,097 ) 18.29 Granted 636,322 17.07 Nonvested at September 30, 2018 2,133,746 $ 15.02 For the three and nine months ended September 30, 2018 , the Company recognized $2.4 million and $9.7 million of share based compensation expense, respectively, compared with $2.4 million and $6.6 million , respectively for the same periods in 2017 . As of September 30, 2018 , the maximum unrecognized cost for restricted stock and RSUs was $19.9 million . The cost is expected to be recognized over a weighted average period of 1.93 years. |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues Summary of Revenue Recognition Accounting Policy The Company's revenue recognition policy follows the guidance from Accounting Standards Codification ("ASC") 606 Revenue from Contracts with Customers , which provides guidance on the recognition, presentation and disclosure of revenue in consolidated financial statements. Revenue is measured on the consideration specified in a contract with a customer. Once the Company determines a contract's performance obligations and the transaction price, including an estimate of any variable consideration, the Company allocates the transaction price to each performance obligation in the contract using a relative stand-alone selling price. The Company recognizes revenue when it satisfies a performance obligation by transferring control of a product or service to a customer. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. Nature of goods and services The following is a description of principal revenue generating activities, described by operating segment, from which the Company generates its revenue. The Payment Services - Puerto Rico & Caribbean segment provides financial institutions, government entities and other issuers services to process credit, debit and prepaid cards; automated teller machines and electronic benefit transfer (“EBT”) card programs (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). Revenue is principally derived from fixed fees per transaction and time and material basis billing for professional service provided to enhance the existing hosted platforms. Professional services in these contracts are primarily considered non-distinct from the transactional services and accounted for as a single performance obligation. Revenue for these contracts is recognized over time in the amount in which the Company has right to consideration. The Payment Services - Latin America segment provides financial institutions, government entities and other issuers services to process credit, debit and prepaid cards, for which revenue is recognized in the same manner as described above, as well as licensed software solutions for risk and fraud management and card payment processing. Licensed software solutions are provided through licensing of software as a service ("SaaS") and on-premise perpetual licenses. Set-up fees related to SaaS are considered non-distinct from the license and accounted for as a single performance obligation. SaaS revenues are recognized over the time the customer benefits from the software. On-premises perpetual licenses primarily require significant customization and development. Professional services provided for significant customizations and development are non-distinct from the license and accounted for as a single performance obligation, recognized over time during the development of the license. Revenue is recognized based on the Company's efforts or inputs, measured in labor hours expended, relative to the total expected inputs to satisfy the performance obligation. Maintenance or support services are considered distinct and recognized over time. The Merchant Acquiring segment provides customers with the ability to accept and process debit and credit cards. Revenue is derived from fixed or identifiable fees charged to individual merchants per transaction, set-up fees, monthly membership fees and rental of POS terminals. Set-up fees are considered non-distinct from the transaction processing services and accounted for as a single performance obligation. Revenue for these contracts is recognized over time in the amount in which the Company has right to consideration. The Business Solutions segment consists of revenues from a full suite of business process management solutions. Revenue derived from core bank processing and other processing and transaction based services are generally recognized over time in the amount in which the Company has right to consideration. Hosting services generally represent a series of distinct months that are substantially the same, and has the same pattern of transfer. Professional services to enhance EVERTEC's platforms are generally considered non-distinct from the hosting service and accounted for as a single performance obligation. Hosting services are generally recognized over time once in production during the remaining term of the contract. Maintenance or support services are considered distinct and recognized over time. Hardware and software sales are recognized at a point in time when the control of the asset is transferred to the customer. Indicators of transfer of control include the Company's right to payment, or as the customer has legal title or physical possession of the asset. The Company’s service contracts may include service level arrangements (“SLA”) generally allowing the customer to receive a credit for part of the service fee when the Company has not provided the agreed level of services. If triggered, the SLA is deemed a consideration payable that may impact the transaction price of the contract, thus SLA performance is monitored and assessed for compliance with arrangements on a monthly basis, including determination and accounting for its economic impact, if any. Refer to Note 14 - Segment Information for further information, including revenue by products and services the Company provides and the geographic regions in which the Company operates. Significant Judgments Contracts with customers often include promises to transfer multiple products and services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. The Company exercises judgment in identifying a suitable method that depicts the entity’s performance in transferring control of the performance obligations satisfied over time, on a contract by contract basis. The principal criteria used for determining the measure of progress is the availability of reliable information that can be obtained without incurring undue cost, which usually results in the input method since, in the majority of cases, the outputs used to reasonably measure progress are not directly observable. The input method is applied based on labor hours expended, relative to the total expected labor hours to satisfy the performance obligation. Judgment is required in determining the stand alone selling price for each distinct performance obligation. Stand-alone selling price is mainly determined based on the price at which the good or service is sold separately. If the good or service is not sold separately, the Company estimates the stand-alone selling price by using the approach of expected cost plus a margin. If the stand-alone selling price is not observable through past transactions, the Company estimates the stand-alone selling price by considering all reasonably available information, including market conditions, trends or other company or customer specific factors. Impact of adoption of Topic 606 The tables below present a summary of the impacts of adopting Topic 606 on the Company's consolidated financial statements for the period ended September 30, 2018 . Balance Sheet September 30, 2018 (Dollar amounts in thousands) As reported Adjustments Balances without the adoption of Topic 606 Assets Prepaid expenses and other assets $ 35,171 $ (364 ) $ 34,807 Liabilities and stockholders' equity Unearned Income 38,234 870 39,104 The total effect of the adjustments to the Consolidated Condensed Statement of Income and Comprehensive Income, Consolidated Condensed Statements of Cash Flows and earnings per share is considered immaterial. Disaggregation of revenue The Company's operating segments are determined by the nature of the products and services the Company provides and the primary geographical markets in which the Company operates. Revenue disaggregated by segment is discussed in Note 14 - Segment Information. In the following table, revenue is disaggregated by timing of revenue recognition. Three months ended September 30, 2018 (In thousands) Payment Services - Puerto Rico & Caribbean Payment Services - Latin America Merchant Acquiring, net Business Solutions Total Timing of revenue recognition Products and services transferred at a point in time $ 114 $ 15 $ — $ 1,652 $ 1,781 Products and services transferred over time 19,679 18,892 24,486 47,179 110,236 $ 19,793 $ 18,907 $ 24,486 $ 48,831 $ 112,017 Nine months ended September 30, 2018 (In thousands) Payment Services - Puerto Rico & Caribbean Payment Services - Latin America Merchant Acquiring, net Business Solutions Total Timing of revenue recognition Products and services transferred at a point in time $ 307 $ 444 $ — $ 3,861 $ 4,612 Products and services transferred over time 56,983 58,090 73,829 142,124 331,026 $ 57,290 $ 58,534 $ 73,829 $ 145,985 $ 335,638 Contract balances The following table provides information about contract assets from contracts with customers. (In thousands) Contract Assets Balance at beginning of period $ 1,903 Services transferred to customers 1,053 Transfers to accounts receivable (1,253 ) September 30, 2018 $ 1,703 Contract assets primarily relate to the Company's right to consideration for work completed but not billed at the reporting date. The contract assets are transferred to accounts receivable when the rights to payment become unconditional. The current portion of these contract assets is recorded as part of prepaid expenses and other assets and the long-term portion is included in other long-term assets. Accounts receivable, net at September 30, 2018 amounted to $82.9 million . Unearned income and Unearned income - Long term, which refer to contract liabilities, at September 30, 2018 amounted to $14.0 million and $24.2 million , respectively, and arise when consideration is received or due in advance from customers prior to performance. Unearned income is mainly related to upfront fees for implementation or set up activities, including fees charged in pre-production periods in connection with hosting services. During the three and nine months ended September 30, 2018 , the Company recognized revenue of $1.2 million and $6.9 million that was included in unearned income at December 31, 2017 . Revenues from recurring transaction-based and processing services represent the majority of the Company's total revenue as of September 30, 2018 . The Company recognizes revenues from recurring transaction-based and processing services over time at the amounts in which the Company has right to invoice, which corresponds directly to the value to the customer of the Company’s performance completed to date. Therefore, the Company has elected to apply the practical expedient in paragraph 606-10-50-14. Under this practical expedient, the Company is not required to disclose information about remaining performance obligations if the contract has an original expected duration of one year or less or if the Company recognizes revenue at the amount to which it has a right to invoice. The Company also applies the practical expedient in paragraph 606-10-50-14A and does not disclose the information about remaining performance obligations for variable consideration when the following condition is met: the variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with paragraph 606-10-25-14(b). The estimated aggregate amount of the transaction price allocated to performance obligations that are unsatisfied or partially satisfied at September 30, 2018 is $249.0 million . This amount primarily consists of professional service fees for implementation or set up activities related to hosting services and maintenance services, which are typically recognized over the life of the contract which vary from 2 to 5 years, with the exception of one contract which represents the majority of the performance obligations under these professional services with a remaining life of 7 years. It also includes professional service fees for customizations or development of on-premise licensing agreements, which are recognized over time based on inputs relative to the total expected inputs to satisfy a performance obligation. This estimate excludes any contracts that are accounted for using the practical expedients noted above. |
Income Tax
Income Tax | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Income Tax The components of income tax expense for the three and nine months ended September 30, 2018 and 2017 , respectively, consisted of the following: Three months ended Nine months ended (In thousands) 2018 2017 2018 2017 Current tax provision (benefit) $ 4,923 $ (301 ) $ 13,083 $ 7,586 Deferred tax benefit (1,621 ) (4,539 ) (2,734 ) (6,338 ) Income tax expense (benefit) $ 3,302 $ (4,840 ) $ 10,349 $ 1,248 The Company conducts operations in Puerto Rico and certain countries in Latin America. As a result, the income tax expense includes the effect of taxes paid to the Puerto Rico government as well as foreign jurisdictions. The following table presents the components of income tax expense for the three and nine months ended September 30, 2018 and 2017 , respectively, and its segregation based on location of operations: Three months ended September 30, Nine months ended September 30, (In thousands) 2018 2017 2018 2017 Current tax provision (benefit) Puerto Rico $ 2,208 $ (1,440 ) $ 6,063 $ 3,420 United States (31 ) (10 ) 142 190 Foreign countries 2,746 1,149 6,878 3,976 Total current tax provision (benefit) $ 4,923 $ (301 ) $ 13,083 $ 7,586 Deferred tax benefit Puerto Rico $ (1,026 ) $ (4,098 ) $ (2,059 ) $ (5,150 ) United States (11 ) (107 ) (109 ) (190 ) Foreign countries (584 ) (334 ) (566 ) (998 ) Total deferred tax benefit $ (1,621 ) $ (4,539 ) $ (2,734 ) $ (6,338 ) Taxes payable to foreign countries by EVERTEC’s subsidiaries will be paid by such subsidiary and the corresponding liability and expense will be presented in EVERTEC’s consolidated financial statements. As of September 30, 2018 , the Company has $38.5 million of unremitted earnings from foreign subsidiaries. The Company has not recognized a deferred tax liability on undistributed earnings for the Company’s foreign subsidiaries because these earnings are intended to be indefinitely reinvested. As of September 30, 2018 , the gross deferred tax asset amounted to $8.8 million and the gross deferred tax liability amounted to $19.2 million , compared to $8.3 million and $21.1 million , respectively, as of December 31, 2017 . Income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following: Nine months ended September 30, (In thousands) 2018 2017 Computed income tax at statutory rates $ 29,902 $ 19,790 Differences in tax rates due to multiple jurisdictions (356 ) 2,237 Tax benefit due to a change in estimate — (334 ) Effect of income subject to tax-exemption grant (19,542 ) (16,421 ) Unrecognized tax expense (benefit) 754 (4,271 ) Other (benefit) expense (409 ) 247 Income tax expense $ 10,349 $ 1,248 |
Net Income Per Common Share
Net Income Per Common Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Income Per Common Share | Net Income Per Common Share The reconciliation of the numerator and denominator of the income per common share is as follows: Three months ended September 30, Nine months ended September 30, (Dollar amounts in thousands, except per share information) 2018 2017 2018 2017 Net income attributable to EVERTEC, Inc. $ 22,997 $ 6,102 $ 66,071 $ 49,220 Less: non-forfeitable dividends on restricted stock 2 4 2 7 Net income available to EVERTEC, Inc.’s common shareholders $ 22,995 $ 6,098 $ 66,069 $ 49,213 Weighted average common shares outstanding 72,721,414 72,386,947 72,590,679 72,509,742 Weighted average potential dilutive common shares (1) 1,935,686 706,771 1,532,752 580,270 Weighted average common shares outstanding - assuming dilution 74,657,100 73,093,718 74,123,431 73,090,012 Net income per common share - basic $ 0.32 $ 0.08 $ 0.91 $ 0.68 Net income per common share - diluted $ 0.31 $ 0.08 $ 0.89 $ 0.67 (1) Potential common shares consist of common stock issuable under the assumed exercise of stock options and restricted stock awards using the treasury stock method. On July 26, 2018, the Company's Board of Directors (the "Board") declared a quarterly cash dividend of $0.05 per share of common stock, which was paid on September 7, 2018 to stockholders of record as of the close of business on August 6, 2018. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Certain lease agreements contain provisions for future rent increases. The total amount of rental payments due over the lease term is being charged to rent expense on the straight-line method over the term of the lease. The difference between rent expense recorded and the amount paid is recorded as a deferred rent obligation. Rent expense of office facilities and real estate for the three months ended September 30, 2018 and 2017 amounted to $2.2 million and $2.1 million , respectively, and for the nine months ended September 30, 2018 and 2017 amounted $6.7 million and $6.1 million , respectively. Rent expense for telecommunications and other equipment for the three months ended September 30, 2018 and 2017 amounted to $1.8 million and $1.5 million , respectively, and for the nine months ended September 30, 2018 and 2017 amounted to $4.9 million and $4.5 million , respectively. EVERTEC is a defendant in a number of legal proceedings arising in the ordinary course of business. Based on the opinion of legal counsel and other factors, Management believes that the final disposition of these matters will not have a material adverse effect on the business, results of operations, financial condition, or cash flows of the Company. The Company has identified certain claims as a result of which a loss may be incurred, but in the aggregate the loss would be insignificant. For other claims regarding proceedings that are in an initial phase, the Company is unable to estimate the range of possible loss, if any, but at this time believes that any loss related to such claims will not be material. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The following table presents the Company’s transactions with related parties for the three and nine months ended September 30, 2018 and 2017 : Three months ended September 30, Nine months ended September 30, (Dollar amounts in thousands) 2018 2017 2018 2017 Total revenues (1)(2) $ 47,216 $ 44,090 $ 139,954 $ 134,045 Cost of revenues $ 840 $ 1,775 $ 2,192 $ 2,610 Rent and other fees $ 2,016 $ 1,962 $ 5,984 $ 5,810 Interest earned from affiliate Interest income $ 37 $ 41 $ 101 $ 119 (1) Total revenues from Popular as a percentage of revenues were 42% , 42% , 41% and 43% for the periods presented above, respectively. (2) Includes revenues generated from investee accounted for under the equity method of $0.3 million , $0.4 million , $1.0 million and $1.5 million for the periods presented above, respectively. At September 30, 2018 and December 31, 2017 , EVERTEC had the following balances arising from transactions with related parties: (Dollar amounts in thousands) September 30, 2018 December 31, 2017 Cash and restricted cash deposits in affiliated bank $ 52,953 $ 23,227 Other due/to from affiliate Accounts receivable $ 23,902 $ 18,073 Prepaid expenses and other assets $ 2,211 $ 1,216 Other long-term assets $ 199 $ 288 Accounts payable $ 5,831 $ 5,827 Unearned income $ 24,252 $ 19,768 |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company operates in four business segments: Payment Services - Puerto Rico & Caribbean, Payment Services - Latin America (collectively "Payment Services segments"), Merchant Acquiring, and Business Solutions. The Payment Services - Puerto Rico & Caribbean segment revenues are comprised of revenues related to providing access to the ATH debit network and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions) and EBT (which principally consist of services to the government of Puerto Rico for the delivery of benefits to participants). For ATH debit network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. For EBT services, revenues are primarily derived from the number of beneficiaries on file. The Payment Services - Latin America segment revenues consist of revenues related to providing access to the ATH network and other card networks to financial institutions, including related services such as authorization, processing, management and recording of ATM and POS transactions, and ATM management and monitoring. The segment revenues also include revenues from card processing services (such as credit and debit card processing, authorization and settlement and fraud monitoring and control to debit or credit issuers), payment processing services (such as payment and billing products for merchants, businesses and financial institutions), as well as, licensed software solutions for risk and fraud management and card payment processing. For ATH debit network and processing services, revenues are primarily driven by the number of transactions processed. Revenues are derived primarily from network fees, transaction switching and processing fees, and the leasing POS devices. For card issuer processing, revenues are primarily dependent upon the number of cardholder accounts on file, transactions and authorizations processed, the number of cards embossed and other processing services. The Merchant Acquiring segment consists of revenues from services that allow merchants to accept electronic methods of payment. In the Merchant Acquiring segment, revenues include a discount fee and membership fees charged to merchants, debit network fees and rental fees from POS devices and other equipment, net of credit card interchange and assessment fees charged by credit cards associations (such as VISA or MasterCard) or payment networks. The discount fee is generally a percentage of the transaction value. EVERTEC also charges merchants for other services that are unrelated to the number of transactions or the transaction value. The Business Solutions segment consists of revenues from a full suite of business process management solutions in various product areas such as core bank processing, network hosting and management, IT professional services, business process outsourcing, item processing, cash processing, and fulfillment. Core bank processing and network services revenues are derived in part from a recurrent fixed fee and from fees based on the number of accounts on file (i.e. savings or checking accounts, loans, etc.) or computer resources utilized. Revenues from other processing services within the Business Solutions segment are generally volume-based and depend on factors such as the number of accounts processed. In addition, EVERTEC is a reseller of hardware and software products and these resale transactions are generally non-recurring. In addition to the four operating segments described above, Management identified certain functional cost areas that operate independently and do not constitute businesses in themselves. These units could neither be concluded as operating segments nor could they be combined with any other operating segments. Therefore, these units are aggregated and presented as “Corporate and Other” category in the financial statements alongside the operating segments. The Corporate and other category consists of corporate overhead expenses, intersegment eliminations, certain leveraged activities and other non-operating and miscellaneous expenses that are not included in the operating segments. The overhead and leveraged costs relate to activities such as: • marketing, • corporate finance and accounting, • human resources, • legal, • risk management functions, • internal audit, • corporate debt related costs, • non-operating depreciation and amortization expenses generated as a result of the Merger, • intersegment revenues and expenses, and • other non-recurring fees and expenses that are not considered when management evaluates financial performance at a segment level The Chief Operating Decision Maker ("CODM") reviews the operating segments separate financial information to assess performance and to allocate resources. Management evaluates the operating results of each of its operating segments based upon revenues and Adjusted Earnings before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA"). Adjusted EBITDA is defined as EBITDA further adjusted to exclude unusual items and other adjustments. Adjusted EBITDA, as it relates to operating segments, is presented in conformity with Accounting Standards Codification Topic 280, "Segment Reporting" given that it is reported to the CODM for purposes of allocating resources. Segment asset disclosure is not used by the CODM as a measure of segment performance since the segment evaluation is driven by revenues and adjusted EBITDA performance. As such, segment assets are not disclosed in the notes to the accompanying consolidated financial statements. The following tables set forth information about the Company’s operations by its four business segments for the periods indicated: Three months ended September 30, 2018 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 28,951 $ 18,907 $ 24,486 $ 48,831 $ (9,158 ) $ 112,017 Operating costs and expenses 13,021 18,890 14,160 30,983 2,602 79,656 Depreciation and amortization 2,505 2,337 427 3,398 7,121 15,788 Non-operating income (expenses) 602 3,834 — 12 (3,080 ) 1,368 EBITDA 19,037 6,188 10,753 21,258 (7,719 ) 49,517 Compensation and benefits (2) 207 363 196 485 1,117 2,368 Transaction, refinancing and other fees (3) — — (1 ) 1 215 215 Adjusted EBITDA $ 19,244 $ 6,551 $ 10,948 $ 21,744 $ (6,387 ) $ 52,100 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $9.2 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received. Three months ended September 30, 2017 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 25,225 $ 17,432 $ 21,555 $ 46,275 $ (7,762 ) $ 102,725 Operating costs and expenses 16,219 21,396 19,444 31,620 5,238 93,917 Depreciation and amortization 2,259 2,608 618 4,024 7,097 16,606 Non-operating income (expenses) 567 1,732 — — (1,952 ) 347 EBITDA 11,832 376 2,729 18,679 (7,855 ) 25,761 Compensation and benefits (2) 205 139 216 781 1,007 2,348 Transaction, refinancing and other fees (3) 3,160 3,221 6,464 — 757 13,602 Adjusted EBITDA $ 15,197 $ 3,736 $ 9,409 $ 19,460 $ (6,091 ) $ 41,711 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $7.8 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received and an impairment charge and contractual fee accrual for a third party software solution that was determined to be commercially unviable. Nine months ended September 30, 2018 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 84,162 $ 58,534 $ 73,829 $ 145,985 $ (26,872 ) $ 335,638 Operating costs and expenses 39,084 55,357 41,413 90,349 12,879 239,082 Depreciation and amortization 7,230 7,035 1,268 10,437 21,413 47,383 Non-operating income (expenses) 1,969 7,048 8 378 (6,913 ) 2,490 EBITDA 54,277 17,260 33,692 66,451 (25,251 ) 146,429 Compensation and benefits (2) 885 1,080 746 1,609 6,350 10,670 Transaction, refinancing and other fees (3) (250 ) — — 1 2,986 2,737 Adjusted EBITDA $ 54,912 $ 18,340 $ 34,438 $ 68,061 $ (15,915 ) $ 159,836 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $26.9 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received. Nine months ended September 30, 2017 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 78,821 $ 43,369 $ 67,546 $ 142,944 $ (25,164 ) $ 307,516 Operating costs and expenses 39,703 47,265 46,545 90,985 13,624 238,122 Depreciation and amortization 6,677 6,327 1,813 12,120 21,252 48,189 Non-operating income (expenses) 1,676 7,187 1 3 (5,625 ) 3,242 EBITDA 47,471 9,618 22,815 64,082 (23,161 ) 120,825 Compensation and benefits (2) 429 446 432 1,293 3,951 6,551 Transaction, refinancing and other fees (3) 2,500 3,221 6,464 — 1,439 13,624 Adjusted EBITDA $ 50,400 $ 13,285 $ 29,711 $ 65,375 $ (17,771 ) $ 141,000 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $25.2 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received and an impairment charge and contractual fee accrual for a third party software solution that was determined to be commercially unviable. The reconciliation of EBITDA to consolidated net income is as follows: Three months ended September 30, Nine months ended September 30, (In thousands) 2018 2017 2018 2017 Total EBITDA $ 49,517 $ 25,761 $ 146,429 $ 120,825 Less: Income tax expense (benefit) 3,302 (4,840 ) 10,349 1,248 Interest expense, net 7,352 7,853 22,375 21,894 Depreciation and amortization 15,788 16,606 47,383 48,189 Net Income $ 23,075 $ 6,142 $ 66,322 $ 49,494 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On October 25, 2018 , the Board declared a regular quarterly cash dividend of $0.05 per share on the Company’s outstanding shares of common stock. The dividend will be paid on December 7, 2018 to stockholders of record as of the close of business on November 5, 2018 . The Board anticipates declaring this dividend in future quarters on a regular basis; however future declarations of dividends are subject to Board of Directors’ approval and may be adjusted as business needs or market conditions change. |
The Company and Basis of Pres_2
The Company and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
The Company | The Company EVERTEC, Inc. (formerly known as Carib Latam Holdings, Inc.) and its subsidiaries (collectively the “Company,” or “EVERTEC”) is a leading full-service transaction processing business in Latin America and the Caribbean. The Company is based in Puerto Rico and provides a broad range of merchant acquiring, payment processing and business process management. The Company provides services across 26 countries in the region. EVERTEC owns and operates the ATH network, one of the leading automated teller machine (“ATM”) and personal identification number (“PIN”) debit networks in Latin America. In addition, EVERTEC provides a comprehensive suite of services for core bank processing, cash processing and technology outsourcing in the regions the Company serves. EVERTEC serves a broad and diversified customer base of leading financial institutions, merchants, corporations and government agencies with solutions that are essential to their operations, enabling them to issue, process and accept transactions securely. |
Basis of Presentation | Basis of Presentation The unaudited consolidated condensed financial statements of EVERTEC have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of the accompanying unaudited consolidated condensed financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited consolidated condensed financial statements. Actual results could differ from these estimates. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted from these statements pursuant to the rules and regulations of the SEC and, accordingly, these consolidated condensed financial statements should be read in conjunction with the Audited Consolidated Financial Statements of the Company for the year ended December 31, 2017 , included in the Company’s 2017 Form 10-K. In the opinion of management, the accompanying consolidated condensed financial statements, prepared in accordance with GAAP, contain all adjustments necessary for a fair presentation. Intercompany accounts and transactions are eliminated in consolidation. |
Recent Accounting Pronouncements | Recently issued accounting pronouncements In August 2018, the Financial Accounting Standards Board ("FASB") issued an updated disclosure framework for fair value measurements. The amendments in the issued update remove, modify and add disclosure requirements on fair value measurements in Topic 820 Fair Value Measurements. The amendments in this update are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Certain amendments in the update should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented. Early adoption is permitted upon issuance of this update. An entity is permitted to early adopt any removed or modified disclosures upon issuance of this update and delay adoption of the additional disclosures until their effective date. The Company is currently evaluating the impact of the adoption of this update on the notes to the consolidated financial statements. In August 2018, the FASB issued updated guidance for customer's accounting for implementation costs incurred in a cloud computing arrangement that is a service contract. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The amendments in this update should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is currently evaluating the impact of the adoption of this update to the consolidated financial statements. Accounting pronouncements issued prior to 2018 and not yet adopted During 2016, the FASB issued a new standard related to Topic 842 Leases to increase transparency and comparability among organizations by recognizing Right of Use ("ROU") assets and lease liabilities on the balance sheet for all leases, other than leases that meet the definition of a short term lease, notwithstanding the lease classification. Under the standard, organizations are required to provide disclosures with the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. In July 2018, the FASB issued Accounting Standards Update ("ASU") 2018-10 and ASU 2018-11, to amend narrow aspects of the standard, to add a new and optional transition method for the adoption of the new standard and provide lessors with a practical expedient, among others. The Company will apply Accounting Standards Codification ("ASC") Topic 842 at the adoption date in accordance with the new and optional transition method available, as well as the package of practical expedients and the use of hindsight practical expedient available for transition. Accordingly, upon transition, the Company will account for its existing leases without reassessing (a) whether the contract contains a lease under ASC Topic 842, (b) whether the lease classification should be different in accordance with ASC Topic 842, or (c) whether initial direct costs before transition would have met the definition of the new leasing standard. In addition, the Company will recognize an ROU asset and a lease liability for all operating leases in its balance sheet. For financing leases, the Company will change the characterization of the asset (to an ROU asset) and the obligation (to a lease liability). The Company will not restate comparative periods. The Company is in the process of calculating the impact of the recognition of ROU assets and lease liabilities for operating leases, which is the most significant impact expected, assessing the potential impact of the new standards in other accounting areas and designing the internal controls to be implemented with the adoption of ASC Topic 842. During 2016, the FASB issued updated guidance for the measurement of credit losses on financial instruments. The amendments in this update require a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset or assets to present the net carrying value at the amount expected to be collected on the financial asset. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectibility of the reported amount. An entity must use judgment in determining the relevant information and estimation methods that are appropriate in its circumstances. The Company expects to adopt this guidance in the fiscal period required by this update and continues to evaluate if the adoption will have an impact on the consolidated financial statements. In August 2017, the FASB issued updated guidance to improve accounting for hedging activities. The amendments in this update better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. To meet that objective, the amendments expand and refine hedge accounting for both nonfinancial and financial risk components and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The amendments in this update require an entity to present the earnings effect of the hedging instrument in the same income statement line item in which the earnings effect of the hedged item is reported and also include certain targeted improvements to ease the application of current guidance related to the assessment of hedge effectiveness. The Company expects to adopt this guidance in the required period and continues to evaluate if this update will have an impact on the consolidated financial statements. |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and equipment, net consists of the following: (Dollar amounts in thousands) Useful life September 30, 2018 December 31, 2017 Buildings 30 $ 1,502 $ 1,531 Data processing equipment 3 - 5 109,694 103,426 Furniture and equipment 3 - 20 7,485 232 Leasehold improvements 5 -10 2,595 2,190 121,276 107,379 Less - accumulated depreciation and amortization (85,929 ) (70,793 ) Depreciable assets, net 35,347 36,586 Land 1,308 1,338 Property and equipment, net $ 36,655 $ 37,924 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill Allocated by Reportable Segments | The changes in the carrying amount of goodwill, allocated by reportable segments, were as follows (See Note 14): (In thousands) Payment Payment Merchant Business Total Balance at December 31, 2017 $ 160,972 $ 53,659 $ 138,121 $ 45,823 $ 398,575 Foreign currency translation adjustments — (2,540 ) — — (2,540 ) Balance at September 30, 2018 $ 160,972 $ 51,119 $ 138,121 $ 45,823 $ 396,035 |
Carrying Amount of Other Intangible Assets | The carrying amount of other intangible assets at September 30, 2018 and December 31, 2017 was as follows: September 30, 2018 (Dollar amounts in thousands) Useful life in years Gross Accumulated Net carrying Customer relationships 8 - 14 $ 343,276 $ (188,027 ) $ 155,249 Trademark 2 - 15 41,671 (27,996 ) 13,675 Software packages 3 - 10 213,368 (147,933 ) 65,435 Non-compete agreement 15 56,539 (30,154 ) 26,385 Other intangible assets, net $ 654,854 $ (394,110 ) $ 260,744 December 31, 2017 (Dollar amounts in thousands) Useful life in years Gross Accumulated Net carrying Customer relationships 8 - 14 $ 344,175 $ (168,134 ) $ 176,041 Trademark 2 - 15 41,594 (25,241 ) 16,353 Software packages 3 - 10 195,262 (136,907 ) 58,355 Non-compete agreement 15 56,539 (27,327 ) 29,212 Other intangible assets, net $ 637,570 $ (357,609 ) $ 279,961 |
Estimated Amortization Expenses | The estimated amortization expense of the balances outstanding at September 30, 2018 for the next five years is as follows: (Dollar amounts in thousands) Remaining 2018 $ 12,870 2019 45,128 2020 39,925 2021 35,202 2022 33,132 |
Debt and Short-Term Borrowings
Debt and Short-Term Borrowings (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Total Debt | Total debt at September 30, 2018 and December 31, 2017 follows: (In thousands) September 30, 2018 December 31, 2017 Senior Secured Credit Facility (2018 Term A) due on April 17, 2018 paying interest at a variable interest rate (London InterBank Offered Rate (“LIBOR”) plus applicable margin (1)(3) ) $ — $ 26,690 Senior Secured Credit Facility (2020 Term A) due on January 17, 2020 paying interest at a variable interest rate (LIBOR plus applicable margin (3)(4) ) 189,974 200,653 Senior Secured Credit Facility (Term B) due on April 17, 2020 paying interest at a variable interest rate (LIBOR plus applicable margin (2)(3) ) 375,165 376,395 Senior Secured Revolving Credit Facility (6) — 12,000 Note Payable due on August 31, 2019 (5) — 584 Note Payable due on April 30, 2021 (3) 330 418 Total debt $ 565,469 $ 616,740 (1) Applicable margin of 2.25% at December 31, 2017 . (2) Subject to a minimum rate (“LIBOR floor”) of 0.75% plus applicable margin of 2.50% at September 30, 2018 and December 31, 2017 . (3) Net of unaccreted discount and unamortized debt issue costs, as applicable. (4) Applicable margin of 2.50% at September 30, 2018 and December 31, 2017 . (5) Fixed interest rate of 7.50% . The Company prepaid the outstanding principal balance of this note during the second quarter of 2018 without penalties. (6) Applicable margin of 2.50% at September 30, 2018 and December 31, 2017 . |
Summary of Interest Rate Swap Transaction | As of September 30, 2018 , the Company has the following interest rate swap agreement converting a portion of the interest rate exposure on the Company's Term B Loan from variable to fixed: Effective date Maturity Date Notional Amount Variable Rate Fixed Rate January 2017 April 2020 $200 million 1-month LIBOR 1.9225% |
Carrying Amount of Derivative Instruments on Company's Balance Sheet | At September 30, 2018 and December 31, 2017 , the carrying amount of the derivative on the Company’s balance sheets is as follows: (Dollar amounts in thousands) September 30, 2018 December 31, 2017 Other long-term assets $ 2,546 $ 214 |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement for Liability at Fair Value on Recurring Basis | The following table summarizes the fair value measurement by level at September 30, 2018 and December 31, 2017 for the asset measured at fair value on a recurring basis: (In thousands) Level 1 Level 2 Level 3 Total September 30, 2018 Financial asset: Interest rate swap $ — $ 2,546 $ — $ 2,546 December 31, 2017 Financial asset: Interest rate swap $ — $ 214 $ — $ 214 |
Carrying Value and Estimated Fair Values for Financial Instruments | The following table presents the carrying value, as applicable, and estimated fair values for financial instruments at September 30, 2018 and December 31, 2017 : September 30, 2018 December 31, 2017 (In thousands) Carrying Fair Carrying Fair Financial assets: Interest rate swap $ 2,546 $ 2,546 $ 214 $ 214 Financial liabilities: Senior Secured Term B Loan 375,165 378,526 376,395 370,540 2018 Term A Loan — — 26,690 26,027 2020 Term A Loan 189,974 190,640 200,653 196,584 |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Summary of Changes in Balances of Accumulated Other Comprehensive Loss | The following table provides a summary of the changes in the balances of accumulated other comprehensive loss for the nine months period ended September 30, 2018 : (In thousands) Foreign Currency Cash Flow Hedge Total Balance - December 31, 2017, net of tax $ (11,062 ) $ 214 $ (10,848 ) Other comprehensive (loss) income before reclassifications (6,225 ) 2,023 (4,202 ) Effective portion reclassified to Net Income — 86 86 Balance - September 30, 2018, net of tax $ (17,287 ) $ 2,323 $ (14,964 ) |
Share-based Compensation (Table
Share-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Nonvested Restricted Shares and RSUs Activity | The following table summarizes nonvested restricted shares and RSUs activity for the nine months ended September 30, 2018 : Nonvested restricted shares and RSUs Shares Weighted-average Nonvested at December 31, 2017 2,340,892 $ 15.08 Forfeited (382,371 ) 17.32 Vested (461,097 ) 18.29 Granted 636,322 17.07 Nonvested at September 30, 2018 2,133,746 $ 15.02 |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Impact of Adoption of Topic 606 | The tables below present a summary of the impacts of adopting Topic 606 on the Company's consolidated financial statements for the period ended September 30, 2018 . Balance Sheet September 30, 2018 (Dollar amounts in thousands) As reported Adjustments Balances without the adoption of Topic 606 Assets Prepaid expenses and other assets $ 35,171 $ (364 ) $ 34,807 Liabilities and stockholders' equity Unearned Income 38,234 870 39,104 |
Disaggregation of Revenue | In the following table, revenue is disaggregated by timing of revenue recognition. Three months ended September 30, 2018 (In thousands) Payment Services - Puerto Rico & Caribbean Payment Services - Latin America Merchant Acquiring, net Business Solutions Total Timing of revenue recognition Products and services transferred at a point in time $ 114 $ 15 $ — $ 1,652 $ 1,781 Products and services transferred over time 19,679 18,892 24,486 47,179 110,236 $ 19,793 $ 18,907 $ 24,486 $ 48,831 $ 112,017 Nine months ended September 30, 2018 (In thousands) Payment Services - Puerto Rico & Caribbean Payment Services - Latin America Merchant Acquiring, net Business Solutions Total Timing of revenue recognition Products and services transferred at a point in time $ 307 $ 444 $ — $ 3,861 $ 4,612 Products and services transferred over time 56,983 58,090 73,829 142,124 331,026 $ 57,290 $ 58,534 $ 73,829 $ 145,985 $ 335,638 |
Summary of Contract Balances | The following table provides information about contract assets from contracts with customers. (In thousands) Contract Assets Balance at beginning of period $ 1,903 Services transferred to customers 1,053 Transfers to accounts receivable (1,253 ) September 30, 2018 $ 1,703 |
Income Tax (Tables)
Income Tax (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Components of Income Tax Expense (Benefit) | The components of income tax expense for the three and nine months ended September 30, 2018 and 2017 , respectively, consisted of the following: Three months ended Nine months ended (In thousands) 2018 2017 2018 2017 Current tax provision (benefit) $ 4,923 $ (301 ) $ 13,083 $ 7,586 Deferred tax benefit (1,621 ) (4,539 ) (2,734 ) (6,338 ) Income tax expense (benefit) $ 3,302 $ (4,840 ) $ 10,349 $ 1,248 |
Segregation of Income Tax Expense Based on Location of Operations | The following table presents the components of income tax expense for the three and nine months ended September 30, 2018 and 2017 , respectively, and its segregation based on location of operations: Three months ended September 30, Nine months ended September 30, (In thousands) 2018 2017 2018 2017 Current tax provision (benefit) Puerto Rico $ 2,208 $ (1,440 ) $ 6,063 $ 3,420 United States (31 ) (10 ) 142 190 Foreign countries 2,746 1,149 6,878 3,976 Total current tax provision (benefit) $ 4,923 $ (301 ) $ 13,083 $ 7,586 Deferred tax benefit Puerto Rico $ (1,026 ) $ (4,098 ) $ (2,059 ) $ (5,150 ) United States (11 ) (107 ) (109 ) (190 ) Foreign countries (584 ) (334 ) (566 ) (998 ) Total deferred tax benefit $ (1,621 ) $ (4,539 ) $ (2,734 ) $ (6,338 ) |
Schedule of Effective Income Tax Rate Reconciliation | Income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following: Nine months ended September 30, (In thousands) 2018 2017 Computed income tax at statutory rates $ 29,902 $ 19,790 Differences in tax rates due to multiple jurisdictions (356 ) 2,237 Tax benefit due to a change in estimate — (334 ) Effect of income subject to tax-exemption grant (19,542 ) (16,421 ) Unrecognized tax expense (benefit) 754 (4,271 ) Other (benefit) expense (409 ) 247 Income tax expense $ 10,349 $ 1,248 |
Net Income Per Common Share (Ta
Net Income Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerator and Denominator of Income Per Common Share | The reconciliation of the numerator and denominator of the income per common share is as follows: Three months ended September 30, Nine months ended September 30, (Dollar amounts in thousands, except per share information) 2018 2017 2018 2017 Net income attributable to EVERTEC, Inc. $ 22,997 $ 6,102 $ 66,071 $ 49,220 Less: non-forfeitable dividends on restricted stock 2 4 2 7 Net income available to EVERTEC, Inc.’s common shareholders $ 22,995 $ 6,098 $ 66,069 $ 49,213 Weighted average common shares outstanding 72,721,414 72,386,947 72,590,679 72,509,742 Weighted average potential dilutive common shares (1) 1,935,686 706,771 1,532,752 580,270 Weighted average common shares outstanding - assuming dilution 74,657,100 73,093,718 74,123,431 73,090,012 Net income per common share - basic $ 0.32 $ 0.08 $ 0.91 $ 0.68 Net income per common share - diluted $ 0.31 $ 0.08 $ 0.89 $ 0.67 (1) Potential common shares consist of common stock issuable under the assumed exercise of stock options and restricted stock awards using the treasury stock method. |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Transactions with Related Parties | The following table presents the Company’s transactions with related parties for the three and nine months ended September 30, 2018 and 2017 : Three months ended September 30, Nine months ended September 30, (Dollar amounts in thousands) 2018 2017 2018 2017 Total revenues (1)(2) $ 47,216 $ 44,090 $ 139,954 $ 134,045 Cost of revenues $ 840 $ 1,775 $ 2,192 $ 2,610 Rent and other fees $ 2,016 $ 1,962 $ 5,984 $ 5,810 Interest earned from affiliate Interest income $ 37 $ 41 $ 101 $ 119 (1) Total revenues from Popular as a percentage of revenues were 42% , 42% , 41% and 43% for the periods presented above, respectively. (2) Includes revenues generated from investee accounted for under the equity method of $0.3 million , $0.4 million , $1.0 million and $1.5 million for the periods presented above, respectively. |
Summary of Balances of Transactions with Related Parties | At September 30, 2018 and December 31, 2017 , EVERTEC had the following balances arising from transactions with related parties: (Dollar amounts in thousands) September 30, 2018 December 31, 2017 Cash and restricted cash deposits in affiliated bank $ 52,953 $ 23,227 Other due/to from affiliate Accounts receivable $ 23,902 $ 18,073 Prepaid expenses and other assets $ 2,211 $ 1,216 Other long-term assets $ 199 $ 288 Accounts payable $ 5,831 $ 5,827 Unearned income $ 24,252 $ 19,768 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Information about Operations by Business Segments | The following tables set forth information about the Company’s operations by its four business segments for the periods indicated: Three months ended September 30, 2018 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 28,951 $ 18,907 $ 24,486 $ 48,831 $ (9,158 ) $ 112,017 Operating costs and expenses 13,021 18,890 14,160 30,983 2,602 79,656 Depreciation and amortization 2,505 2,337 427 3,398 7,121 15,788 Non-operating income (expenses) 602 3,834 — 12 (3,080 ) 1,368 EBITDA 19,037 6,188 10,753 21,258 (7,719 ) 49,517 Compensation and benefits (2) 207 363 196 485 1,117 2,368 Transaction, refinancing and other fees (3) — — (1 ) 1 215 215 Adjusted EBITDA $ 19,244 $ 6,551 $ 10,948 $ 21,744 $ (6,387 ) $ 52,100 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $9.2 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received. Three months ended September 30, 2017 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 25,225 $ 17,432 $ 21,555 $ 46,275 $ (7,762 ) $ 102,725 Operating costs and expenses 16,219 21,396 19,444 31,620 5,238 93,917 Depreciation and amortization 2,259 2,608 618 4,024 7,097 16,606 Non-operating income (expenses) 567 1,732 — — (1,952 ) 347 EBITDA 11,832 376 2,729 18,679 (7,855 ) 25,761 Compensation and benefits (2) 205 139 216 781 1,007 2,348 Transaction, refinancing and other fees (3) 3,160 3,221 6,464 — 757 13,602 Adjusted EBITDA $ 15,197 $ 3,736 $ 9,409 $ 19,460 $ (6,091 ) $ 41,711 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $7.8 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received and an impairment charge and contractual fee accrual for a third party software solution that was determined to be commercially unviable. Nine months ended September 30, 2018 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 84,162 $ 58,534 $ 73,829 $ 145,985 $ (26,872 ) $ 335,638 Operating costs and expenses 39,084 55,357 41,413 90,349 12,879 239,082 Depreciation and amortization 7,230 7,035 1,268 10,437 21,413 47,383 Non-operating income (expenses) 1,969 7,048 8 378 (6,913 ) 2,490 EBITDA 54,277 17,260 33,692 66,451 (25,251 ) 146,429 Compensation and benefits (2) 885 1,080 746 1,609 6,350 10,670 Transaction, refinancing and other fees (3) (250 ) — — 1 2,986 2,737 Adjusted EBITDA $ 54,912 $ 18,340 $ 34,438 $ 68,061 $ (15,915 ) $ 159,836 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $26.9 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement and the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received. Nine months ended September 30, 2017 (In thousands) Payment Payment Merchant Business Corporate and Other (1) Total Revenues $ 78,821 $ 43,369 $ 67,546 $ 142,944 $ (25,164 ) $ 307,516 Operating costs and expenses 39,703 47,265 46,545 90,985 13,624 238,122 Depreciation and amortization 6,677 6,327 1,813 12,120 21,252 48,189 Non-operating income (expenses) 1,676 7,187 1 3 (5,625 ) 3,242 EBITDA 47,471 9,618 22,815 64,082 (23,161 ) 120,825 Compensation and benefits (2) 429 446 432 1,293 3,951 6,551 Transaction, refinancing and other fees (3) 2,500 3,221 6,464 — 1,439 13,624 Adjusted EBITDA $ 50,400 $ 13,285 $ 29,711 $ 65,375 $ (17,771 ) $ 141,000 (1) Corporate and Other consists of corporate overhead, certain leveraged activities, other non-operating expenses and intersegment eliminations. Intersegment eliminations predominantly reflect the $25.2 million processing fee from Payments Services - Puerto Rico and Caribbean to Merchant Acquiring and cost transfer fees from Corporate and Other to Payment Services Latin America for leveraged services and management fees. (2) Primarily represents share-based compensation, other compensation expense and severance payments. (3) Primarily represents fees and expenses associated with corporate transactions as defined in the Credit Agreement, the elimination of non-cash equity earnings from our 19.99% equity investment in Consorcio de Tarjetas Dominicanas S.A., net of cash dividends received and an impairment charge and contractual fee accrual for a third party software solution that was determined to be commercially unviable. |
Reconciliation of Income from Operations to Consolidated Net Income | The reconciliation of EBITDA to consolidated net income is as follows: Three months ended September 30, Nine months ended September 30, (In thousands) 2018 2017 2018 2017 Total EBITDA $ 49,517 $ 25,761 $ 146,429 $ 120,825 Less: Income tax expense (benefit) 3,302 (4,840 ) 10,349 1,248 Interest expense, net 7,352 7,853 22,375 21,894 Depreciation and amortization 15,788 16,606 47,383 48,189 Net Income $ 23,075 $ 6,142 $ 66,322 $ 49,494 |
The Company and Basis of Pres_3
The Company and Basis of Presentation (Detail) | Sep. 30, 2018country |
Accounting Policies [Abstract] | |
Number of countries where the Company provides a broad range of merchant acquiring, payment processing and business process management services (in country) | 26 |
Property and Equipment, net (De
Property and Equipment, net (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Property and Equipment, net | |||||
Property and equipment, gross | $ 121,276 | $ 121,276 | $ 107,379 | ||
Less - accumulated depreciation and amortization | (85,929) | (85,929) | (70,793) | ||
Depreciable assets, net | 35,347 | 35,347 | 36,586 | ||
Land | 1,308 | 1,308 | 1,338 | ||
Property and equipment, net | 36,655 | 36,655 | 37,924 | ||
Depreciation and amortization expense related to property and equipment | 3,700 | $ 3,800 | $ 10,900 | $ 11,200 | |
Buildings | |||||
Property and Equipment, net | |||||
Useful life in years | 30 years | ||||
Property and equipment, gross | 1,502 | $ 1,502 | 1,531 | ||
Data processing equipment | |||||
Property and Equipment, net | |||||
Property and equipment, gross | 109,694 | $ 109,694 | 103,426 | ||
Data processing equipment | Minimum | |||||
Property and Equipment, net | |||||
Useful life in years | 3 years | ||||
Data processing equipment | Maximum | |||||
Property and Equipment, net | |||||
Useful life in years | 5 years | ||||
Furniture and equipment | |||||
Property and Equipment, net | |||||
Property and equipment, gross | 7,485 | $ 7,485 | 232 | ||
Furniture and equipment | Minimum | |||||
Property and Equipment, net | |||||
Useful life in years | 3 years | ||||
Furniture and equipment | Maximum | |||||
Property and Equipment, net | |||||
Useful life in years | 20 years | ||||
Leasehold improvements | |||||
Property and Equipment, net | |||||
Property and equipment, gross | $ 2,595 | $ 2,595 | $ 2,190 | ||
Leasehold improvements | Minimum | |||||
Property and Equipment, net | |||||
Useful life in years | 5 years | ||||
Leasehold improvements | Maximum | |||||
Property and Equipment, net | |||||
Useful life in years | 10 years |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Goodwill by Segments (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Changes in the Carrying Amount of Goodwill | |
Beginning balance | $ 398,575 |
Foreign currency translation adjustments | (2,540) |
Ending balance | 396,035 |
Payment Services - Puerto Rico & Caribbean | |
Changes in the Carrying Amount of Goodwill | |
Beginning balance | 160,972 |
Foreign currency translation adjustments | 0 |
Ending balance | 160,972 |
Payment Services - Latin America | |
Changes in the Carrying Amount of Goodwill | |
Beginning balance | 53,659 |
Foreign currency translation adjustments | (2,540) |
Ending balance | 51,119 |
Merchant Acquiring, net | |
Changes in the Carrying Amount of Goodwill | |
Beginning balance | 138,121 |
Foreign currency translation adjustments | 0 |
Ending balance | 138,121 |
Business Solutions | |
Changes in the Carrying Amount of Goodwill | |
Beginning balance | 45,823 |
Foreign currency translation adjustments | 0 |
Ending balance | $ 45,823 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Impairment of goodwill | $ 6,500,000 | $ 0 | $ 0 | |
Amortization expense for intangible assets | $ 11,900,000 | 12,700,000 | $ 36,400,000 | $ 36,900,000 |
Contractual fees | 5,300,000 | |||
Maintenance expense | $ 1,000,000 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Other Intangible Assets (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $ 654,854 | $ 637,570 |
Accumulated amortization | (394,110) | (357,609) |
Net carrying amount | 260,744 | 279,961 |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | 343,276 | 344,175 |
Accumulated amortization | (188,027) | (168,134) |
Net carrying amount | $ 155,249 | $ 176,041 |
Customer relationships | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 8 years | 8 years |
Customer relationships | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 14 years | 14 years |
Trademark | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $ 41,671 | $ 41,594 |
Accumulated amortization | (27,996) | (25,241) |
Net carrying amount | $ 13,675 | $ 16,353 |
Trademark | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 2 years | 2 years |
Trademark | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 15 years | 15 years |
Software packages | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross amount | $ 213,368 | $ 195,262 |
Accumulated amortization | (147,933) | (136,907) |
Net carrying amount | $ 65,435 | $ 58,355 |
Software packages | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 3 years | 3 years |
Software packages | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 10 years | 10 years |
Non-compete agreement | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life in years | 15 years | 15 years |
Gross amount | $ 56,539 | $ 56,539 |
Accumulated amortization | (30,154) | (27,327) |
Net carrying amount | $ 26,385 | $ 29,212 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Estimated Amortization Expenses (Detail) $ in Thousands | Sep. 30, 2018USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remaining 2,018 | $ 12,870 |
2,019 | 45,128 |
2,020 | 39,925 |
2,021 | 35,202 |
2,022 | $ 33,132 |
Debt and Short-Term Borrowing_2
Debt and Short-Term Borrowings - Total Debt (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Total debt | $ 565,469 | $ 616,740 |
Notes Payable | ||
Debt Instrument [Line Items] | ||
Note payable | 400 | 1,000 |
Note Payable due on August 31, 2019 | Notes Payable | ||
Debt Instrument [Line Items] | ||
Note payable | $ 0 | 584 |
Fixed interest rate | 7.50% | |
Note Payable due on April 30, 2021 | Notes Payable | ||
Debt Instrument [Line Items] | ||
Note payable | $ 330 | 418 |
Term A due on April 17, 2018 | Credit Facility | ||
Debt Instrument [Line Items] | ||
Credit facility | 0 | $ 26,690 |
Term A due on April 17, 2018 | Credit Facility | LIBOR | ||
Debt Instrument [Line Items] | ||
Margin interest rate | 2.25% | |
Term A due on January 17, 2020 | Credit Facility | ||
Debt Instrument [Line Items] | ||
Credit facility | $ 189,974 | $ 200,653 |
Term A due on January 17, 2020 | Credit Facility | LIBOR | ||
Debt Instrument [Line Items] | ||
Margin interest rate | 2.50% | 2.50% |
Term B due on April 17, 2020 | Credit Facility | ||
Debt Instrument [Line Items] | ||
Credit facility | $ 375,165 | $ 376,395 |
Term B due on April 17, 2020 | Credit Facility | LIBOR | ||
Debt Instrument [Line Items] | ||
Margin interest rate | 2.50% | 2.50% |
Minimum variable rate | 0.75% | 0.75% |
Senior Secured Revolving Credit Facility | Credit Facility | ||
Debt Instrument [Line Items] | ||
Credit facility | $ 0 | $ 12,000 |
Senior Secured Revolving Credit Facility | Credit Facility | LIBOR | ||
Debt Instrument [Line Items] | ||
Margin interest rate | 2.50% | 2.50% |
Debt and Short-Term Borrowing_3
Debt and Short-Term Borrowings - Additional Information (Detail) - USD ($) | 9 Months Ended | |||||
Sep. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 31, 2016 | May 31, 2016 | Apr. 17, 2013 | |
Debt Instrument [Line Items] | ||||||
Losses reclassified from accumulated other comprehensive loss into income | $ 100,000 | |||||
Gains expected to be reclassified from accumulated other comprehensive loss into income in the next 12 months | 500,000 | |||||
Notes Payable | ||||||
Debt Instrument [Line Items] | ||||||
Non interest bearing financing agreement | $ 1,100,000 | $ 700,000 | ||||
Note payable | 400,000 | $ 1,000,000 | ||||
Term A due on April 17, 2018 | Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | $ 250,000,000 | $ 300,000,000 | ||||
Term A due on April 17, 2018 | Credit Facility | Maturity not extended | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | 30,000,000 | |||||
2013 Credit Agreement, Term B Loan | Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | 400,000,000 | |||||
2013 Credit Agreement, Revolving Facility | Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | $ 100,000,000 | |||||
Term A due on January 17, 2020 | Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Secured credit facilities | 191,400,000 | |||||
Term A due on January 17, 2020 | Credit Facility | Maturity extended | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | 219,000,000 | |||||
Term B due on April 17, 2020 | Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Secured credit facilities | 379,000,000 | |||||
Senior Secured Revolving Credit Facility | Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | 100,000,000 | |||||
Additional borrowing capacity available under the Revolving Facility | $ 65,000,000 | |||||
Senior Secured Revolving Credit Facility | Credit Facility | Maturity extended | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | 65,000,000 | |||||
Senior Secured Revolving Credit Facility | Credit Facility | Maturity not extended | ||||||
Debt Instrument [Line Items] | ||||||
Maximum amount under credit facilities | $ 35,000,000 |
Debt and Short-Term Borrowing_4
Debt and Short-Term Borrowings - Summary of Interest Rate Swap Transaction (Detail) - Interest Rate Swap | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Derivative [Line Items] | |
Notional Amount | $ 200,000,000 |
1-month LIBOR | |
Derivative [Line Items] | |
Fixed Rate | 1.9225% |
Debt and Short-Term Borrowing_5
Debt and Short-Term Borrowings - Carrying Amount of Derivative Instruments on Company's Balance Sheet (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure [Abstract] | ||
Other long-term assets | $ 2,546 | $ 214 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements - Recurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Financial assets | ||
Interest rate swap | $ 2,546 | $ 214 |
Recurring | Level 1 | ||
Financial assets | ||
Interest rate swap | 0 | 0 |
Recurring | Level 2 | ||
Financial assets | ||
Interest rate swap | 2,546 | 214 |
Recurring | Level 3 | ||
Financial assets | ||
Interest rate swap | $ 0 | $ 0 |
Financial Instruments and Fai_4
Financial Instruments and Fair Value Measurements - Carrying Value and Estimated Fair Values (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Financial assets | ||
Interest rate swap | $ 2,546 | $ 214 |
Carrying Amount | ||
Financial assets | ||
Interest rate swap | 2,546 | 214 |
Carrying Amount | Credit Facility | Senior Secured Term B Loan | ||
Financial liabilities | ||
Senior secured term loan | 375,165 | 376,395 |
Carrying Amount | Credit Facility | 2018 Term A Loan | ||
Financial liabilities | ||
Senior secured term loan | 0 | 26,690 |
Carrying Amount | Credit Facility | 2020 Term A Loan | ||
Financial liabilities | ||
Senior secured term loan | 189,974 | 200,653 |
Fair Value | ||
Financial assets | ||
Interest rate swap | 2,546 | 214 |
Fair Value | Credit Facility | Senior Secured Term B Loan | ||
Financial liabilities | ||
Senior secured term loan | 378,526 | 370,540 |
Fair Value | Credit Facility | 2018 Term A Loan | ||
Financial liabilities | ||
Senior secured term loan | 0 | 26,027 |
Fair Value | Credit Facility | 2020 Term A Loan | ||
Financial liabilities | ||
Senior secured term loan | $ 190,640 | $ 196,584 |
Equity (Detail)
Equity (Detail) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Changes in Accumulated Other Comprehensive Income (Loss) | |
Beginning balance | $ 147,976 |
Other comprehensive (loss) income before reclassifications | (4,202) |
Effective portion reclassified to Net Income | 86 |
Ending balance | 214,952 |
Foreign Currency Translation Adjustments | |
Changes in Accumulated Other Comprehensive Income (Loss) | |
Beginning balance | (11,062) |
Other comprehensive (loss) income before reclassifications | (6,225) |
Effective portion reclassified to Net Income | 0 |
Ending balance | (17,287) |
Cash Flow Hedge | |
Changes in Accumulated Other Comprehensive Income (Loss) | |
Beginning balance | 214 |
Other comprehensive (loss) income before reclassifications | 2,023 |
Effective portion reclassified to Net Income | 86 |
Ending balance | 2,323 |
Total | |
Changes in Accumulated Other Comprehensive Income (Loss) | |
Beginning balance | (10,848) |
Ending balance | $ (14,964) |
Share-based Compensation - Addi
Share-based Compensation - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expenses | $ 2.4 | $ 2.4 | $ 9.7 | $ 6.6 |
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Maximum unrecognized cost for stocks and RSU's | $ 19.9 | $ 19.9 | ||
Unrecognized compensation cost, weighted average period of recognition | 1 year 11 months 5 days | |||
Time Based Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Awards with Performance Conditions | 2015 LTIP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 1 year | |||
Awards with Performance Conditions | 2016 LTIP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Requisite service period | 2 years | |||
Awards with Performance Conditions | 2017 LTIP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Requisite service period | 2 years | |||
Performance adjustment percent | 25.00% | |||
Performance measurement period | 1 year |
Share-based Compensation - Nonv
Share-based Compensation - Nonvested Restricted Shares and RSUs Activity (Detail) - Restricted Shares and RSUs | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Shares | |
Beginning balance (in shares) | shares | 2,340,892 |
Forfeited (in shares) | shares | (382,371) |
Vested (in shares) | shares | (461,097) |
Granted (in shares) | shares | 636,322 |
Ending balance (in shares) | shares | 2,133,746 |
Weighted-average grant date fair value | |
Beginning balance (in usd per share) | $ / shares | $ 15.08 |
Forfeited (in usd per share) | $ / shares | 17.32 |
Vested (in usd per share) | $ / shares | 18.29 |
Granted (in usd per share) | $ / shares | 17.07 |
Ending balance (in usd per share) | $ / shares | $ 15.02 |
Revenues - Impact of Adoption o
Revenues - Impact of Adoption of Topic 606 (Details) $ in Thousands | Sep. 30, 2018USD ($) |
Assets | |
Prepaid expenses and other assets | $ 35,171 |
Liabilities and stockholders' equity | |
Unearned income | 38,234 |
Calculated under Revenue Guidance in Effect before Topic 606 | |
Assets | |
Prepaid expenses and other assets | 34,807 |
Liabilities and stockholders' equity | |
Unearned income | 39,104 |
Accounting Standards Update 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | |
Assets | |
Prepaid expenses and other assets | (364) |
Liabilities and stockholders' equity | |
Unearned income | $ 870 |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 112,017 | $ 102,725 | $ 335,638 | $ 307,516 |
Products and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,781 | 4,612 | ||
Products and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 110,236 | 331,026 | ||
Payment Services - Puerto Rico & Caribbean | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 19,793 | 57,290 | ||
Payment Services - Puerto Rico & Caribbean | Products and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 114 | 307 | ||
Payment Services - Puerto Rico & Caribbean | Products and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 19,679 | 56,983 | ||
Payment Services - Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 18,907 | 58,534 | ||
Payment Services - Latin America | Products and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 15 | 444 | ||
Payment Services - Latin America | Products and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 18,892 | 58,090 | ||
Merchant Acquiring, net | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 24,486 | 73,829 | ||
Merchant Acquiring, net | Products and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | ||
Merchant Acquiring, net | Products and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 24,486 | 73,829 | ||
Business Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 48,831 | 145,985 | ||
Business Solutions | Products and services transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,652 | 3,861 | ||
Business Solutions | Products and services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 47,179 | $ 142,124 |
Revenues - Contract Balances (D
Revenues - Contract Balances (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Balance at beginning of period | $ 1,903 |
Services transferred to customers | 1,053 |
Transfers to accounts receivable | (1,253) |
September 30, 2018 | $ 1,703 |
Revenues - Performance Obligati
Revenues - Performance Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Revenue from Contract with Customer [Abstract] | |||
Accounts receivable, net | $ 82,865 | $ 82,865 | $ 83,328 |
Unearned income | 14,017 | 14,017 | 7,737 |
Unearned income - long term | 24,217 | 24,217 | $ 23,486 |
Revenue recognized that was included in unearned income | 1,200 | 6,900 | |
Transaction price allocated to performance obligations that are unsatisfied or partially satisfied | $ 249,000 | $ 249,000 | |
Professional Services, All Other Contracts | Minimum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Revenue, remaining performance obligation, period of expected timing of satisfaction | 2 years | 2 years | |
Professional Services, All Other Contracts | Maximum | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Revenue, remaining performance obligation, period of expected timing of satisfaction | 5 years | 5 years | |
Professional Services, One Contract Representing Majority of Performance Obligations | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Revenue, remaining performance obligation, period of expected timing of satisfaction | 7 years | 7 years |
Income Tax - Components of Inco
Income Tax - Components of Income Tax Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Current tax provision (benefit) | $ 4,923 | $ (301) | $ 13,083 | $ 7,586 |
Deferred tax benefit | (1,621) | (4,539) | (2,734) | (6,338) |
Income tax expense (benefit) | $ 3,302 | $ (4,840) | $ 10,349 | $ 1,248 |
Income Tax - Tax Expense Based
Income Tax - Tax Expense Based on Location (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Current tax provision (benefit) | ||||
Puerto Rico | $ 2,208 | $ (1,440) | $ 6,063 | $ 3,420 |
United States | (31) | (10) | 142 | 190 |
Foreign countries | 2,746 | 1,149 | 6,878 | 3,976 |
Total current tax provision (benefit) | 4,923 | (301) | 13,083 | 7,586 |
Deferred tax benefit | ||||
Puerto Rico | (1,026) | (4,098) | (2,059) | (5,150) |
United States | (11) | (107) | (109) | (190) |
Foreign countries | (584) | (334) | (566) | (998) |
Total deferred tax benefit | $ (1,621) | $ (4,539) | $ (2,734) | $ (6,338) |
Income Tax - Additional Informa
Income Tax - Additional Information (Detail) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Unremitted earnings from foreign subsidiaries | $ 38.5 | |
Gross deferred tax asset | 8.8 | $ 8.3 |
Gross deferred tax liability | $ 19.2 | $ 21.1 |
Income Tax - Effective Income T
Income Tax - Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Computed income tax at statutory rates | $ 29,902 | $ 19,790 | ||
Differences in tax rates due to multiple jurisdictions | (356) | 2,237 | ||
Tax benefit due to a change in estimate | 0 | (334) | ||
Effect of income subject to tax-exemption grant | (19,542) | (16,421) | ||
Unrecognized tax expense (benefit) | 754 | (4,271) | ||
Other (benefit) expense | (409) | 247 | ||
Income tax expense (benefit) | $ 3,302 | $ (4,840) | $ 10,349 | $ 1,248 |
Net Income Per Common Share - R
Net Income Per Common Share - Reconciliation of Income Per Common Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to EVERTEC, Inc. | $ 22,997 | $ 6,102 | $ 66,071 | $ 49,220 |
Less: non-forfeitable dividends on restricted stock | 2 | 4 | 2 | 7 |
Net income available to EVERTEC, Inc.’s common shareholders | $ 22,995 | $ 6,098 | $ 66,069 | $ 49,213 |
Weighted average common shares outstanding (in shares) | 72,721,414 | 72,386,947 | 72,590,679 | 72,509,742 |
Weighted average potential dilutive common shares (in shares) | 1,935,686 | 706,771 | 1,532,752 | 580,270 |
Weighted average common shares outstanding - assuming dilution (in shares) | 74,657,100 | 73,093,718 | 74,123,431 | 73,090,012 |
Net income per common share - basic (in usd per share) | $ 0.32 | $ 0.08 | $ 0.91 | $ 0.68 |
Net income per common share - diluted (in usd per share) | 0.31 | 0.08 | 0.89 | 0.67 |
Cash dividends declared (in usd per share) | $ 0.05 | $ 0.10 | $ 0.05 | $ 0.3 |
Commitments and Contingencies (
Commitments and Contingencies (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Rent expense of office facilities and real estate | $ 2.2 | $ 2.1 | $ 6.7 | $ 6.1 |
Rent expense for telecommunications and other equipment | $ 1.8 | $ 1.5 | $ 4.9 | $ 4.5 |
Related Party Transactions - Tr
Related Party Transactions - Transactions with Related Parties (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Transactions with Third Party | ||||
Total revenues | $ 47,216 | $ 44,090 | $ 139,954 | $ 134,045 |
Cost of revenues | 840 | 1,775 | 2,192 | 2,610 |
Rent and other fees | 2,016 | 1,962 | 5,984 | 5,810 |
Interest earned from affiliate | ||||
Interest income | 37 | 41 | 101 | 119 |
Revenues generated from investee accounted for under equity method | $ 300 | $ 400 | $ 1,000 | $ 1,500 |
Popular | Customer Concentration Risk | Total Revenue | ||||
Interest earned from affiliate | ||||
Total percentage of revenues from Popular | 42.00% | 42.00% | 41.00% | 43.00% |
Related Party Transactions - Ba
Related Party Transactions - Balances of Transactions (Detail) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Related Party Transactions [Abstract] | ||
Cash and restricted cash deposits in affiliated bank | $ 52,953 | $ 23,227 |
Other due/to from affiliate | ||
Accounts receivable | 23,902 | 18,073 |
Prepaid expenses and other assets | 2,211 | 1,216 |
Other long-term assets | 199 | 288 |
Accounts payable | 5,831 | 5,827 |
Unearned income | $ 24,252 | $ 19,768 |
Segment Information - Operation
Segment Information - Operations by Segments (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)segment | Sep. 30, 2017USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of operating business segments (in segment) | segment | 4 | |||
Revenues | $ 112,017 | $ 102,725 | $ 335,638 | $ 307,516 |
Operating costs and expenses | 79,656 | 93,917 | 239,082 | 238,122 |
Depreciation and amortization | 15,788 | 16,606 | 47,383 | 48,189 |
Non-operating income (expenses) | 1,368 | 347 | 2,490 | 3,242 |
EBITDA | 49,517 | 25,761 | 146,429 | 120,825 |
Compensation and benefits | 2,368 | 2,348 | 10,670 | 6,551 |
Transaction, refinancing and other fees | 215 | 13,602 | 2,737 | 13,624 |
Adjusted EBITDA | $ 52,100 | $ 41,711 | $ 159,836 | $ 141,000 |
Consorcio de Tarjetas Dominicanas S.A. | ||||
Segment Reporting Information [Line Items] | ||||
Equity investment | 19.99% | 19.99% | 19.99% | 19.99% |
Operating Segments | Payment Services - Puerto Rico & Caribbean | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 28,951 | $ 25,225 | $ 84,162 | $ 78,821 |
Operating costs and expenses | 13,021 | 16,219 | 39,084 | 39,703 |
Depreciation and amortization | 2,505 | 2,259 | 7,230 | 6,677 |
Non-operating income (expenses) | 602 | 567 | 1,969 | 1,676 |
EBITDA | 19,037 | 11,832 | 54,277 | 47,471 |
Compensation and benefits | 207 | 205 | 885 | 429 |
Transaction, refinancing and other fees | 0 | 3,160 | (250) | 2,500 |
Adjusted EBITDA | 19,244 | 15,197 | 54,912 | 50,400 |
Operating Segments | Payment Services - Latin America | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 18,907 | 17,432 | 58,534 | 43,369 |
Operating costs and expenses | 18,890 | 21,396 | 55,357 | 47,265 |
Depreciation and amortization | 2,337 | 2,608 | 7,035 | 6,327 |
Non-operating income (expenses) | 3,834 | 1,732 | 7,048 | 7,187 |
EBITDA | 6,188 | 376 | 17,260 | 9,618 |
Compensation and benefits | 363 | 139 | 1,080 | 446 |
Transaction, refinancing and other fees | 0 | 3,221 | 0 | 3,221 |
Adjusted EBITDA | 6,551 | 3,736 | 18,340 | 13,285 |
Operating Segments | Merchant Acquiring, net | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 24,486 | 21,555 | 73,829 | 67,546 |
Operating costs and expenses | 14,160 | 19,444 | 41,413 | 46,545 |
Depreciation and amortization | 427 | 618 | 1,268 | 1,813 |
Non-operating income (expenses) | 0 | 0 | 8 | 1 |
EBITDA | 10,753 | 2,729 | 33,692 | 22,815 |
Compensation and benefits | 196 | 216 | 746 | 432 |
Transaction, refinancing and other fees | (1) | 6,464 | 0 | 6,464 |
Adjusted EBITDA | 10,948 | 9,409 | 34,438 | 29,711 |
Operating Segments | Business Solutions | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 48,831 | 46,275 | 145,985 | 142,944 |
Operating costs and expenses | 30,983 | 31,620 | 90,349 | 90,985 |
Depreciation and amortization | 3,398 | 4,024 | 10,437 | 12,120 |
Non-operating income (expenses) | 12 | 0 | 378 | 3 |
EBITDA | 21,258 | 18,679 | 66,451 | 64,082 |
Compensation and benefits | 485 | 781 | 1,609 | 1,293 |
Transaction, refinancing and other fees | 1 | 0 | 1 | 0 |
Adjusted EBITDA | 21,744 | 19,460 | 68,061 | 65,375 |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | (9,158) | (7,762) | (26,872) | (25,164) |
Operating costs and expenses | 2,602 | 5,238 | 12,879 | 13,624 |
Depreciation and amortization | 7,121 | 7,097 | 21,413 | 21,252 |
Non-operating income (expenses) | (3,080) | (1,952) | (6,913) | (5,625) |
EBITDA | (7,719) | (7,855) | (25,251) | (23,161) |
Compensation and benefits | 1,117 | 1,007 | 6,350 | 3,951 |
Transaction, refinancing and other fees | 215 | 757 | 2,986 | 1,439 |
Adjusted EBITDA | $ (6,387) | $ (6,091) | $ (15,915) | $ (17,771) |
Segment Information - Income fr
Segment Information - Income from Segments to Consolidated Net Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Segment Reporting [Abstract] | ||||
Total EBITDA | $ 49,517 | $ 25,761 | $ 146,429 | $ 120,825 |
Less | ||||
Income tax expense | 3,302 | (4,840) | 10,349 | 1,248 |
Interest expense, net | 7,352 | 7,853 | 22,375 | 21,894 |
Depreciation and amortization | 15,788 | 16,606 | 47,383 | 48,189 |
Net income | $ 23,075 | $ 6,142 | $ 66,322 | $ 49,494 |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | Oct. 25, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 |
Subsequent Event [Line Items] | |||||
Cash dividends declared (in usd per share) | $ 0.05 | $ 0.10 | $ 0.05 | $ 0.3 | |
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Cash dividends declared (in usd per share) | $ 0.05 |