Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 02, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | PAYC | |
Entity Registrant Name | Paycom Software, Inc. | |
Entity Central Index Key | 1,590,955 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 59,105,143 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 48,547 | $ 25,144 |
Restricted cash | 371 | |
Accounts receivable | 3,397 | 2,794 |
Prepaid expenses | 2,426 | 1,952 |
Inventory | 639 | 195 |
Income tax receivable | 935 | |
Deferred tax assets, net | 316 | 1,445 |
Current assets before funds held for clients | 55,325 | 32,836 |
Funds held for clients | 615,895 | 660,557 |
Total current assets | 671,220 | 693,393 |
Property and equipment, net | 53,674 | 47,919 |
Deposits and other assets | 913 | 645 |
Goodwill | 51,889 | 51,889 |
Intangible assets, net | 3,886 | 5,096 |
Total assets | 781,582 | 798,942 |
Current liabilities: | ||
Accounts payable | 3,853 | 3,042 |
Income tax payable | 1,608 | |
Accrued commissions and bonuses | 4,509 | 5,080 |
Accrued payroll and vacation | 4,106 | 1,582 |
Deferred revenue | 3,329 | 2,535 |
Current portion of long-term debt | 875 | 855 |
Accrued expenses and other current liabilities | 7,401 | 5,121 |
Current liabilities before client funds obligation | 25,681 | 18,215 |
Client funds obligation | 615,895 | 660,557 |
Total current liabilities | 641,576 | 678,772 |
Deferred tax liabilities, net | 464 | 3,107 |
Long-term deferred revenue | 22,657 | 16,802 |
Long-term debt, less current portion | 25,206 | 26,123 |
Total long-term liabilities | $ 48,327 | $ 46,032 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock, $0.01 par value (100,000,000 shares authorized, 57,050,684 and 53,832,782 shares issued and outstanding at September 30, 2015 and December 31, 2014, respectively) | $ 571 | $ 538 |
Additional paid in capital | 69,657 | 67,937 |
Retained earnings | 21,451 | 5,663 |
Total stockholders' equity | 91,679 | 74,138 |
Total liabilities and stockholders' equity | $ 781,582 | $ 798,942 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 57,050,684 | 53,832,782 |
Common stock, shares outstanding | 57,050,684 | 53,832,782 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues | ||||
Recurring | $ 54,233 | $ 35,910 | $ 156,404 | $ 105,030 |
Implementation and other | 1,107 | 688 | 3,131 | 1,859 |
Total revenues | 55,340 | 36,598 | 159,535 | 106,889 |
Cost of revenues | ||||
Operating expenses | 7,964 | 5,798 | 22,569 | 17,847 |
Depreciation and amortization | 945 | 638 | 2,642 | 1,876 |
Total cost of revenues | 8,909 | 6,436 | 25,211 | 19,723 |
Administrative expenses | ||||
Sales and marketing | 23,774 | 14,856 | 61,744 | 44,237 |
Research and development | 2,349 | 1,059 | 6,123 | 2,878 |
General and administrative | 11,996 | 8,410 | 34,076 | 25,816 |
Depreciation and amortization | 1,457 | 1,159 | 4,180 | 3,322 |
Total administrative expenses | 39,576 | 25,484 | 106,123 | 76,253 |
Total operating expenses | 48,485 | 31,920 | 131,334 | 95,976 |
Operating income | 6,855 | 4,678 | 28,201 | 10,913 |
Interest expense | (343) | (338) | (1,067) | (3,079) |
Loss on early repayment of debt | (4,044) | |||
Other income, net | 98 | 39 | 150 | 1,395 |
Income before income taxes | 6,610 | 4,379 | 27,284 | 5,185 |
Provision for income taxes | 2,763 | 1,689 | 11,496 | 2,028 |
Net income | $ 3,847 | $ 2,690 | $ 15,788 | $ 3,157 |
Net income per share, basic | $ 0.07 | $ 0.05 | $ 0.28 | $ 0.06 |
Net income per share, diluted | $ 0.07 | $ 0.05 | $ 0.27 | $ 0.06 |
Weighted average shares outstanding: | ||||
Basic | 57,050,684 | 51,056,462 | 56,287,979 | 49,040,344 |
Diluted | 58,367,830 | 52,978,051 | 57,771,680 | 51,223,048 |
Condensed Consolidated Stateme5
Condensed Consolidated Statement of Cash Flows (unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities | ||
Net income | $ 15,788 | $ 3,157 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 6,822 | 5,198 |
Amortization of debt issuance costs | 108 | |
Amortization of debt discount | 67 | |
Write off of debt issuance costs | 4,051 | |
Net loss on disposition of property and equipment | 15 | |
Stock-based compensation expense | 1,721 | 362 |
Employee stock purchase plan compensation expense | 86 | |
Net change in derivative liability | (1,107) | |
Deferred taxes, net | (1,514) | 1,414 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (592) | 237 |
Prepaid expenses | (474) | (94) |
Inventory | 245 | 195 |
Deposits and other assets | (336) | (145) |
Accounts payable | (850) | (3,044) |
Income taxes, net | 2,543 | 298 |
Accrued commissions and bonuses | (571) | (1,030) |
Accrued payroll and vacation | 2,524 | (422) |
Deferred revenue | 6,649 | 4,662 |
Accrued expenses and other current liabilities | 1,965 | (498) |
Net cash provided by operating activities | 34,129 | 13,301 |
Cash flows from investing activities | ||
Decrease in funds held for clients | 44,662 | 62,146 |
Decrease in restricted cash | 371 | 1 |
Purchases of property and equipment | (10,150) | (11,948) |
Net cash provided by investing activities | 34,883 | 50,199 |
Cash flows from financing activities | ||
Proceeds from issuance of long-term debt | 6,539 | |
Principal payments on long-term debt | (897) | (65,442) |
Decrease in client funds obligation | (44,662) | (62,146) |
Proceeds from initial public offering, net of offering costs | 62,843 | |
Payment of debt issuance costs | (50) | |
Capital impact of reorganization | (183) | |
Net cash used in financing activities | (45,609) | (58,389) |
Change in cash and cash equivalents | 23,403 | 5,111 |
Cash and cash equivalents | ||
Beginning of period | 25,144 | 13,362 |
End of period | $ 48,547 | $ 18,473 |
Organization and Description of
Organization and Description of Business | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Organization and Description of Business | 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Description of Business Paycom Software, Inc. (“Software”) and its wholly-owned subsidiaries (collectively, the “Company”) is a leading provider of comprehensive, cloud-based human capital management (“HCM”) software delivered as Software-as-a-Service. Unless we state otherwise or the context otherwise requires, the terms “we”, “our”, “us” and the “Company” refer to Software and its consolidated subsidiaries. We provide functionality and data analytics that businesses need to manage the complete employment life cycle from recruitment to retirement. Our solution requires virtually no customization and is based on a core system of record maintained in a single database for all HCM functions, including talent acquisition, time and labor management, payroll, talent management and human resources (“HR”) management applications. The Reorganization Software and its wholly-owned subsidiary, Payroll Software Merger Sub, LLC (“Merger Sub”) were formed as Delaware entities on October 31, 2013 and December 23, 2013, respectively, in anticipation of an initial public offering and were wholly-owned subsidiaries of Paycom Payroll Holdings, LLC (“Holdings”) prior to December 31, 2013. On January 1, 2014, we consummated a reorganization pursuant to which (i) affiliates of Welsh, Carson, Anderson & Stowe X, L.P. (“WCAS X”), WCAS Capital Partners IV, L.P. (“WCAS Capital IV”) and WCAS Management Corporation (collectively, “WCAS”), contributed WCAS Paycom Holdings, Inc. (“WCAS Holdings”) and WCAS CP IV Blocker, Inc. (“CP IV Blocker”), which collectively owned all of the Series A Preferred Units of Holdings, to Software in exchange for shares of common stock of Software and (ii) the owners of outstanding Series B Preferred Units of Holdings contributed their Series B Preferred Units of Holdings to Software in exchange for shares of common stock of Software. Immediately after these contributions, Merger Sub merged with and into Holdings with Holdings surviving the merger. Upon consummation of the merger, the remaining holders of outstanding common and incentive units of Holdings received shares of common stock and restricted stock of Software for their common and incentive units by operation of Delaware law and Holdings’ ownership interest in Software was cancelled. Outstanding common units, Series B Preferred Units and incentive units of Holdings, WCAS Holdings and CP IV Blocker were contributed to Software in exchange for, or converted into, an aggregate of 45,708,573 shares of common stock and 8,121,101 shares of restricted stock of Software. Prior to the reorganization, WCAS Holdings held Series C Preferred Units of Holdings in the amount of $46.2 million and WCAS Holdings had a note payable to a related party due April 3, 2017, in the amount of $46.2 million. Following these transactions, all outstanding Series C Preferred Units were eliminated in an intercompany transaction between Holdings and WCAS Holdings, and we assumed the 14% Note due 2017 issued by WCAS Holdings (the “2017 Note”). Following the reorganization, Software became a holding company with its principal assets being the Series B Preferred Units of Holdings and the outstanding capital stock of WCAS Holdings and CP IV Blocker (collectively, the “2014 Reorganization”). Initial Public Offering On April 21, 2014, we closed our initial public offering whereby an aggregate of 7,641,750 shares of our common stock were sold to the public (including 4,606,882 shares of common stock issued and sold by us and 3,034,868 shares of common stock sold by certain selling stockholders) at a public offering price of $15.00 per share. We did not receive any proceeds from the sale of shares by the selling stockholders. The total gross proceeds we received from the offering were $69.1 million. After deducting underwriting discounts and commissions and offering expenses payable by us, the aggregate net proceeds we received totaled approximately $62.8 million. We used all of the net proceeds from the offering, together with approximately $3.3 million from existing cash, for the repayment in full of the 2017 Note and the 10% Senior Note due 2022 issued by us to WCAS Capital IV. Follow-On Public Offering On January 21, 2015, we closed our follow-on public offering, whereby 6,422,750 shares of our common stock were sold to the public by certain selling stockholders at a public offering price of $22.50 per share. We did not receive any proceeds from the sale of these shares. Registered Block Trade Transactions On May 20, 2015, we closed an underwritten secondary offering of 8,000,000 shares of our common stock by WCAS X, WCAS Capital IV, each of our executive officers and certain other selling stockholders at a public offering price of $36.25 per share. We did not receive any proceeds from the sale of these shares. On September 15, 2015, we closed an underwritten secondary offering of 4,500,000 shares of our common stock by WCAS X, WCAS Capital IV, each of our executive officers and certain other selling stockholders at a public offering price of $37.95 per share. On September 23, 2015, the underwriter exercised its option to purchase an additional 675,000 shares from WCAS X and WCAS Capital IV. We did not receive any proceeds from the sale of these shares. Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial statements that permit reduced disclosure for interim periods. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments necessary to fairly present our Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014, our Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2015 and 2014 and our Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2015 and 2014. Such adjustments are of a normal recurring nature. In addition to these normal adjustments, on the Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2014, we combined the accounts “Income tax receivable” and “Income tax payable” and the accounts “Deferred tax assets” and “Deferred tax liabilities” in order to conform to the current period presentation. The information in this Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K that was filed with the SEC on February 26, 2015. The results of operations for the three and nine months ended September 30, 2015 are not necessarily indicative of the results expected for the full fiscal year. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include income taxes, contingencies, the useful life for property and equipment and intangible assets, the life of our client relationships, the fair value of our stock-based awards and the fair value of our financial instruments, intangible assets and goodwill. These estimates are based on historical experience where applicable and other assumptions that management believes are reasonable under circumstances. As such, actual results could materially differ from these estimates. Summary of Significant Accounting Policies Our significant accounting policies are discussed in “Note 2. Summary of Significant Accounting Policies” in our audited consolidated financial statements for the year ended December 31, 2014, included in the Annual Report on Form 10-K that was filed with the SEC on February 26, 2015. Employee Stock Purchase Plan An award issued under the Paycom Software, Inc. Employee Stock Purchase Plan (the “ESPP”) is classified as a share based liability and recorded at the fair value of the award. Expense is recognized, net of estimated forfeitures, on a straight line basis over the requisite service period. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which included a comprehensive new revenue recognition model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 31, 2016, and early adoption is not permitted. In April 2015, the FASB proposed a one year deferral of the effective date of the new revenue recognition standard for public and non-public entities reporting under U.S. GAAP and on July 9, 2015, the FASB approved the one year deferral. The effective date of the amended standard will begin in periods beginning after December 15, 2017. We are currently evaluating the impact that the standard will have on our condensed consolidated financial statements. In June 2014, the FASB issued authoritative guidance for share-based payments which requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. This update further clarifies that compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable for the period(s) in which the requisite service has already been rendered. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. In April 2015, the FASB issued authoritative guidance for intangibles related to internally developed software. The new guidance will assist entities in evaluating the accounting for fees paid by a customer in a cloud computing arrangement. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. In April 2015, the FASB issued authoritative guidance which simplifies the presentation of debt issuance costs. Under the new guidance, debt issuance costs related to a recognized debt liability will be presented in the Condensed Consolidated Balance Sheets as a direct deduction from the carrying amount of the debt liability. The new guidance is effective for public entities for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. Debt issuance costs are currently included on the Condensed Consolidated Balance Sheets as an asset. In July 2015, the FASB issued authoritative guidance which simplifies the measurement of inventory. Under the new guidance, an entity should measure inventory (as defined within the scope of the guidance) at the lower of cost or new realizable value. The new guidance applies to all inventory except inventory measured using last-in, first-out (LIFO) or the retail inventory method. Net realizable value is defined as the estimated selling price in the ordinary course of business, less reasonably predicable costs of completion, disposal and transportation. The new guidance is effective for public companies for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Accordingly, the standard is effective for us on January 1, 2017. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2015 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 2. PROPERTY AND EQUIPMENT Property and equipment and associated accumulated depreciation and amortization were as follows: September 30, December 31, 2015 2014 Property and equipment Buildings $ 28,154 $ 28,154 Software and capitalized software costs 11,997 8,671 Computer equipment 10,027 7,638 Rental clocks 8,131 6,596 Furniture, fixtures and equipment 5,049 4,361 Vehicles 421 421 Leasehold improvements 307 174 64,086 56,015 Less: accumulated depreciation and amortization (22,699 ) (17,089 ) 41,387 38,926 Land 8,993 8,993 Construction in process 3,294 - Property and equipment, net $ 53,674 $ 47,919 Depreciation and amortization expense for property and equipment, net, was $2.0 million and $5.6 million for the three and nine months ended September 30, 2015, respectively. Depreciation and amortization expense for property and equipment, net, was $1.4 million and $4.0 million for the three and nine months ended September 30, 2014, respectively. For the three and nine months ended September 30, 2015 and 2014, we paid interest costs of $0.3 million and $0.9 million, respectively. We did not capitalize any interest costs during the three months ended September 30, 2015 and 2014 and for the nine months ended September 30, 2015. We capitalized $0.4 million of interest costs during the nine months ended September 30, 2014. We capitalize computer software development costs related to software developed for internal use in accordance with Accounting Standards Codification (“ASC”) Topic 350-40. During the three and nine months ended September 30, 2015, we capitalized $1.1 million and $2.7 million of computer software development costs related to software developed for internal use, respectively. During the three and nine months ended September 30, 2014, we capitalized $0.6 million and $1.3 million of computer software development costs related to software developed for internal use, respectively. |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | 3. GOODWILL AND INTANGIBLE ASSETS, NET Goodwill represents the excess of cost over our net tangible and identified intangible assets. We had goodwill of $51.9 million as of September 30, 2015 and December 31, 2014. We have selected June 30 as our annual goodwill impairment testing date and determined there was no impairment as of June 30, 2015. For the year ended December 31, 2014, there were no indicators of impairment. All of our intangible assets are considered to have finite lives and, as such, are subject to amortization. The components of intangible assets were as follows: September 30, 2015 Weighted Avg. Remaining Accumulated Useful Life Gross Amortization Net (Years) Intangibles: Customer relationships 1.8 $ 13,997 $ (11,547 ) $ 2,450 Trade name 6.8 3,194 (1,758 ) 1,436 Total $ 17,191 $ (13,305 ) $ 3,886 December 31, 2014 Weighted Avg. Remaining Accumulated Useful Life Gross Amortization Net (Years) Intangibles: Customer relationships 2.5 $ 13,997 $ (10,498 ) $ 3,499 Trade name 7.5 3,194 (1,597 ) 1,597 Total $ 17,191 $ (12,095 ) $ 5,096 The weighted average remaining useful life of our intangible assets was 3.6 years as of September 30, 2015. Amortization of intangible assets for the three and nine months ended September 30, 2015 and 2014 was $0.4 million and $1.2 million, respectively. |
Funds Held for Clients and Clie
Funds Held for Clients and Client Funds Obligation | 9 Months Ended |
Sep. 30, 2015 | |
Accounts Payable And Accrued Expenses [Abstract] | |
Funds Held for Clients and Client Funds Obligation | 4. FUNDS HELD FOR CLIENTS AND CLIENT FUNDS OBLIGATION As part of our payroll and tax filing application, we collect funds for federal, state and local employment taxes from clients, handle applicable regulatory tax filings, correspondence and amendments, remit the funds to appropriate tax agencies, and handle other employer-related services. Amounts collected by us from clients for their federal, state and local employment taxes earn interest during the interval between receipt and disbursement, as we invest these funds in money market funds and certificates of deposit. These collections from clients are typically disbursed from one to 30 days after receipt, with some funds being held for up to 120 days. These investments are shown in the Condensed Consolidated Balance Sheets as “Funds held for clients”, and the offsetting liability for the tax filings is shown as “Client funds obligation”. As of September 30, 2015 and December 31, 2014, the funds held for clients were invested in demand deposits, certificates of deposit and money market funds. The interest earned on these funds is included in “Other income, net” on the Condensed Consolidated Statements of Income. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | 5. LONG-TERM DEBT Our long-term debt consisted of the following: September 30, 2015 December 31, 2014 Term note to bank due May 30, 2021 (1) $ 26,081 $ 26,978 Total long-term debt (including current portion) 26,081 26,978 Less: Current portion (875 ) (855 ) Total long-term debt, net $ 25,206 $ 26,123 (1) Our outstanding indebtedness consisted of a term note under the 2021 Consolidated Loan due to Kirkpatrick Bank (the “2021 Consolidated Loan”) with an outstanding principal balance of $26.1 million and $27.0 million as of September 30, 2015 and December 31, 2014, respectively. The 2021 Consolidated Loan matures on May 30, 2021. Under the 2021 Consolidated Loan, interest is payable monthly and accrues at a fixed rate of 4.75% per annum. The 2021 Consolidated Loan is secured by a mortgage covering our headquarters and certain personal property relating to our headquarters. The 2021 Consolidated Loan includes certain financial covenants, including maintaining a fixed charge coverage ratio of EBITDA to fixed charges (defined as current maturities of long-term debt, interest expense, rent expense and distributions), of greater than 1.2 to 1.0, which is measured on a quarterly basis. We were in compliance with all of the covenants as of September 30, 2015. As of September 30, 2015, the carrying value of our total long-term debt, including current portion, was $26.1 million, which approximated its fair value. As of December 31, 2014, the carrying value of our total long-term debt, including current portion, was $27.0 million, which approximated its fair value. The fair value of fixed rate long-term debt is estimated based on the borrowing rates currently available to us for bank loans with similar terms and maturities. On May 13, 2015, we entered into a loan agreement with Kirkpatrick Bank to finance the expansion of our headquarters (the “Construction Loan”). The Construction Loan allows for the borrowing of a maximum aggregate principal amount equal to the lesser of (i) $11.0 million or (ii) 80% of the appraised value of the constructed property. We did not have any outstanding borrowings under the Construction Loan as of September 30, 2015. The Construction Loan matures on the earlier of the completion of construction or November 13, 2016, with variable interest accruing at the greater of (i) the prime rate, plus 50 basis points or (ii) 4.0%. At maturity, the outstanding principal balance of the Construction Loan will be automatically converted to a 78-month term loan. The term loan will accrue fixed interest at the prevailing 7/20 London Interbank Offered Rate swap interest rate that is in effect as of the commencement date, plus 225 basis points. |
Employee Savings Plan and Emplo
Employee Savings Plan and Employee Stock Purchase Plan | 9 Months Ended |
Sep. 30, 2015 | |
Compensation Related Costs [Abstract] | |
Employee Savings Plan and Employee Stock Purchase Plan | 6. EMPLOYEE SAVINGS PLAN AND EMPLOYEE STOCK PURCHASE PLAN Our employees that are over the age of 21 and have completed ninety (90) days of service are eligible to participate in our 401(k) plan. We have made a Qualified Automatic Contribution Arrangement (“QACA”) election, whereby we make a matching contribution for our employees equal to 100% of the first 1% of salary deferrals and 50% of salary deferrals between 2% and 6%, up to a maximum matching contribution of 3.5% of salary each plan year. We are allowed to make additional discretionary matching contributions and discretionary profit sharing contributions. Employees are 100% vested in amounts attributable to salary deferrals and rollover contributions. The QACA matching contributions will be 100% vested after two years of employment from the date of hire. If an employee terminates service prior to completing two years of employment, the employee will not be vested in these QACA matching contributions. The discretionary contributions vest 100% after two years of employment from the date of hire. Matching contributions amounted to $0.6 million and $1.8 million for the three and nine months ended September 30, 2015, respectively. Matching contributions amounted to $0.4 million and $1.3 million for the three and nine months ended September 30, 2014, respectively. On May 5, 2015, our stockholders approved the ESPP. The ESPP allows, at the beginning of each offering period, eligible employees to elect to contribute, through payroll deductions, up to 10% of their compensation, subject to an annual per employee maximum, to purchase shares of the Company’s common stock at a price of 85% of the fair market value of the shares on the exercise date. Each offering period of the ESPP lasts six months and the maximum number of shares that may be acquired by a participant during each offering period is 2,000 shares. The shares reserved for purposes of the ESPP are shares we purchase in the open market and the maximum number of shares of the Company’s common stock that may be acquired by participants under the ESPP is 2,000,000 shares. During the three months ended September 30, 2015, eligible employees purchased 24,935 shares of the Company’s common stock under the ESPP. Compensation expense related to the ESPP is recognized on a straight-line basis over the requisite service period. Our compensation expense related to the ESPP was $0.1 million and $0.2 million for the three and nine months ended September 30, 2015, respectively. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 7. FAIR VALUE OF FINANCIAL INSTRUMENTS Our financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, funds held for clients, client funds obligation and long-term debt. The carrying amount of cash and cash equivalents, accounts receivable, accounts payable, funds held for clients and client funds obligation approximates fair value because of the short-term nature of the instruments. We did not have any financial instruments that were measured on a recurring basis at either September 30, 2015 or December 31, 2014. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 8. EARNINGS PER SHARE Basic earnings per share (“EPS”) is based on the weighted average number of shares of common stock outstanding for the period. Diluted EPS is computed in a similar manner to basic EPS after assuming the issuance of shares of common stock for all potentially dilutive shares of restricted stock whether or not they are vested. In accordance with ASC Topic 260 “Earnings Per Share”, the two-class method determines earnings for each class of common stock and participating securities according to an earnings allocation formula that adjusts the income available to common stockholders for dividends or dividend equivalents and participation rights in undistributed earnings. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and, therefore, are included in computing earnings per share pursuant to the two-class method. The outstanding restricted shares of stock that were issued on July 8, 2015, are considered participating securities. The following is a reconciliation of net income and the shares of common stock used in the computation of basic and diluted net income per share (dollars in thousands): Three Months Ended Nine Months Ended September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014 Numerator: Net income $ 3,847 $ 2,690 $ 15,788 $ 3,157 Less: income allocable to participating securities (49 ) — (205 ) — Income allocable to common shares $ 3,798 $ 2,690 $ 15,583 $ 3,157 Add back: undistributed earnings allocable to participating securities 49 — 205 — Less: undistributed earnings reallocated to participating securities (49 ) — (200 ) — Numerator for diluted earnings per share $ 3,798 $ 2,690 $ 15,588 $ 3,157 Denominator: Weighted average common shares outstanding 50,315,455 51,056,462 50,315,455 49,040,344 Adjustment for vested restricted stock 6,735,229 - 5,972,524 - Shares for calculating basic EPS 57,050,684 51,056,462 56,287,979 49,040,344 Dilutive effect of unvested restricted stock 1,317,146 1,921,589 1,483,701 2,182,704 Shares for calculating diluted EPS 58,367,830 52,978,051 57,771,680 51,223,048 Net income per share: Basic $ 0.07 $ 0.05 $ 0.28 $ 0.06 Diluted $ 0.07 $ 0.05 $ 0.27 $ 0.06 |
Stockholders' Equity and Incent
Stockholders' Equity and Incentive Compensation | 9 Months Ended |
Sep. 30, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stockholders' Equity and Incentive Compensation | 9. STOCKHOLDERS’ EQUITY AND INCENTIVE COMPENSATION On January 1, 2014, we consummated the 2014 Reorganization, pursuant to which (i) affiliates of WCAS contributed WCAS Holdings and CP IV Blocker, which collectively owned all of the Series A Preferred Units of Holdings, to Software in exchange for shares of common stock of Software and (ii) the owners of outstanding Series B Preferred Units of Holdings contributed their Series B Preferred Units of Holdings to Software in exchange for shares of common stock of Software. Immediately after these contributions, Merger Sub merged with and into Holdings with Holdings surviving the merger. Upon consummation of the merger, the remaining holders of outstanding common and incentive units of Holdings received shares of common stock of Software for their common and incentive units by operation of Delaware law and Holdings’ ownership interest in Software was cancelled. Outstanding common units, Series B Preferred Units and WCAS Holdings and CP IV Blocker were contributed to Software in exchange for, or converted into, 45,708,573 shares of common stock and 8,121,101 shares of restricted stock of Software. The shares of restricted stock were issued subject to various vesting conditions. A portion of the restricted stock was subject to time-based vesting conditions, while a portion was subject to market-based vesting conditions. The market-based vesting conditions were based on our total enterprise value exceeding certain specified thresholds. Following these transactions, all outstanding Series C Preferred Units were eliminated in an intercompany transaction between Holdings and WCAS Holdings, and we assumed the 2017 Note. As a result of the 2014 Reorganization, we recorded a one-time reclassification of $29.3 million of accumulated deficit to additional paid in capital on January 1, 2014. Following the 2014 Reorganization, Software became a holding company with its principal assets being the Series B Preferred Units of Holdings and the outstanding capital stock of WCAS Holdings and CP IV Blocker. Compensation expense for restricted stock awards with time-based vesting conditions was measured based on the fair value of the award on the grant date and recognized over the requisite service period on a straight-line basis. Compensation expense relating to the issuance of restricted stock with market-based vesting conditions was measured based upon the fair value of the award on the grant date and recognized on a straight-line basis over the vesting period based upon the probability that the vesting conditions would be met. For restricted stock with market-based vesting conditions, 50% of the restricted stock vested upon reaching a total enterprise value of $1.4 billion on December 1, 2014 and the remaining 50% of the restricted stock vested upon reaching a total enterprise value of $1.8 billion on March 2, 2015. The associated compensation expense adjusted for actual forfeitures was $0.2 million for the nine months ended September 30, 2015 for the vesting of the restricted stock with market-based vesting conditions on March 2, 2015. The total net compensation expense for the vesting of the restricted stock with time and market-based vesting conditions was $0.3 million for the nine months ended September 30, 2015. There was $0.3 million and $0.7 million of total unrecognized compensation cost related to unvested time-based restricted stock outstanding as of September 30, 2015 and December 31, 2014, respectively. The unrecognized compensation cost is expected to be recognized over a weighted average period of 2.1 years as of September 30, 2015. On May 5, 2015, our stockholders approved the Paycom Software, Inc. Annual Incentive Plan (the “Incentive Plan”). The Incentive Plan provides for the payment of incentive compensation that is not subject to certain federal income tax deduction limitations. Participation in the Incentive Plan is limited to certain of our employees designated by the Compensation Committee of the Board of Directors. On July 8, 2015, we issued an aggregate of 741,931 shares of restricted stock to each of our executive officers and certain non-executive employees under the Paycom Software, Inc. 2014 Long-Term Incentive Plan (the “LTIP”), of which 477,200 shares are subject to market-based vesting conditions and 264,731 shares are subject to time-based vesting conditions. The fair value of each share of restricted stock with market-based vesting conditions is estimated on the grant date using a Monte Carlo simulation model. This model considers a range of assumptions related to volatility, risk-free interest rate, expected term and expected dividend yield. Expected volatilities used in the model are based on historical volatilities of comparable guideline companies until a sufficient trading history in the Company’s common stock exists. The annual volatility assumed in the model was 26%. An expected dividend yield of 0% is applied given that the Company has not paid any dividends. The risk-free interest rate of 2.2% is derived from the implied yield available on 10 year U.S. Treasury securities with a remaining term equivalent to that of the applicable shares as of the valuation date. The expected term represents the period that the applicable shares of restricted stock are expected to be outstanding. The Company determined the expected term assumption based on the vesting terms and contractual terms of the restricted stock. The Company is required to estimate forfeitures and only record compensation costs for those awards that are expected to vest. Restricted stock with market-based vesting conditions will vest 50% when the Company reaches a total enterprise value of $2.65 billion and 50% when the Company reaches a total enterprise value of $3.5 billion. Restricted stock with time-based vesting conditions will vest over periods of three or five years. Compensation expense for restricted stock awards with time-based vesting conditions was measured based on the fair value of the underlying shares of restricted stock on the grant date (which was equal to the closing price of our common stock of $33.33 on the grant date) and will be recognized over the requisite service periods on a straight-line basis. Compensation expense for restricted stock awards with market-based vesting conditions was measured based on the fair value of the underlying shares of restricted stock on the grant date, which was $21.76 or $27.24 depending on the enterprise value target. Compensation expense for restricted stock with market-based vesting conditions will be recognized on a straight-line basis over the requisite service period of 2.3 to 4.2 years. Our compensation expense related to the LTIP was $1.4 million for both the three and nine months ended September 30, 2015. There was $17.1 million of unrecognized compensation cost, net of estimated forfeitures, related to unvested restricted stock outstanding as of September 30, 2015. The unrecognized compensation cost is expected to be recognized over a weighted average period of 2.2 years as of September 30, 2015. We do not receive any cash proceeds from the vesting of our restricted stock. The capitalized cash stock-based compensation expense related to software developed for internal use of $31 thousand for the nine months ended September 30, 2015 and $4 thousand for the year ended December 31, 2014, was included in software and capitalized software costs in “Property and equipment, net” in our Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014, respectively. |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | 10. RELATED-PARTY TRANSACTIONS For the three and nine months ended September 30, 2015 and 2014, we paid rent on our Dallas office space in the amounts of $0.1 million and $0.2 million, respectively. The Dallas office building is owned by 417 Oakbend, LP, a Texas limited partnership. Our Chief Sales Officer owns a .01% general partnership interest and a 10.49% limited partnership interest in 417 Oakbend, LP. We incurred $1.0 million of registration and legal fees in connection with the underwritten secondary offerings in 2015, which were charged to general and administrative expense and from which we did not receive any proceeds. The payment of such fees included expenses on behalf of related parties and was approved by the Company’s Audit Committee. In April 2014, we paid off the balance of the 2017 Note that was issued by WCAS Holdings and was payable to WCAS X, a related party, with proceeds from our initial public offering. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. COMMITMENTS AND CONTINGENCIES Employment Agreements We have employment agreements with certain of our executive officers. The agreements allow for annual compensation, participation in executive benefit plans, and performance-based cash bonuses. Funding Agreement In March 2010, we entered into a funding agreement with the Oklahoma City Economic Development Trust (the “Trust”) and the City of Oklahoma City. The Trust provided $2.0 million worth of certain public infrastructure improvements related to our newly constructed principal executive offices in northwest Oklahoma City. In exchange for the infrastructure improvements provided, we agreed to create at least 492 jobs over a five year period, with an average first year salary in excess of $37 thousand and make a minimum capital investment in the project of at least $15.0 million. We further agreed that we would be responsible for repayment of any amount that was not offset by earned job creation payments. As of December 31, 2014, we had fulfilled our obligation for these job creation payments. Legal Proceedings On September 23, 2014, National Financial Partners Corp. (“NFP”) filed a complaint against us in the United States District Court for the Northern District of Illinois (the “District Court”) (Civil Action No. 1:14-cv-07424). The complaint alleged trademark infringement, unfair competition, deceptive trade practices, consumer fraud and deceptive business practices related to the adoption and use of our logo and sought preliminary and permanent injunctions prohibiting us from continued infringement as well as money damages, including an accounting for sales and profits, attorneys’ fees and disgorgement of profits. NFP also moved for an order preliminarily enjoining us from using our logo. On April 30, 2015, we filed an opposition to NFP’s motion for preliminary injunction. On May 7 and 8, 2015, the District Court held a hearing on NFP’s motion for a preliminary injunction. On June 10, 2015, the District Court entered an order granting a preliminary injunction in favor of NFP and thereafter issued its preliminary injunction on June 16, 2015. On June 16, 2015, we filed an appeal of the District Court’s order and preliminary injunction to the United States Circuit Court of Appeals for the Seventh Circuit (Case No. 15-2289). We further sought a stay of the preliminary injunction pending the appeal. On June 30, 2015, the District Court granted our motion for a stay pending appeal. On June 25, 2015, we filed an offer of judgment seeking to resolve all pending claims between the parties and terminate the action with the payment of $20 thousand by Paycom Payroll, LLC and an agreement to change our logo within 60 days. Our offer of judgment was accepted by NFP and the District Court entered a judgment pursuant to the offer of judgment on July 6, 2015, terminating the District Court action. The Seventh Circuit Court of Appeals case was terminated on July 8, 2015. We are involved in various other legal proceedings in the ordinary course of business. Although we cannot predict the outcome of these proceedings, legal matters are subject to inherent uncertainties and there exists the possibility that the ultimate resolution of these matters could have a material adverse effect on our business, financial condition, results of operations and cash flows. Operating Leases and Deferred Rent We lease office space under several noncancellable operating leases with contractual terms expiring from 2015 to 2021. Minimum rent expenses are recognized over the lease term. The lease term is defined as the fixed noncancellable term of the lease plus all periods, if any, for which failure to renew the lease imposes a penalty on us in an amount that a renewal appears, at the inception of the lease, to be reasonably assured. When a lease contains a predetermined fixed escalation of the minimum rent, we recognize the related rent expense on a straight-line basis and record the difference between the recognized rent expense and the amount payable under the lease as a liability. As of September 30, 2015 and December 31, 2014, we had $0.8 million and $0.8 million, respectively, recorded as a liability for deferred rent. Rent expense under operating leases for the three and nine months ended September 30, 2015, was $1.1 million and $3.3 million, respectively. Rent expense under operating leases for the three and nine months ended September 30, 2014, was $1.0 million and $2.4 million, respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. INCOME TAXES The provision for income taxes is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items. Significant management judgment is required in estimating operating income in order to determine our effective income tax rate. The estimated effective income tax rate was 41.79% and 42.13% for the three and nine months ended September 30, 2015, respectively. The estimated effective income tax rate was 38.57% and 39.11% for the three and nine months ended September 30, 2014, respectively. The higher effective income tax rate for the three and nine months ended September 30, 2015 is primarily the result of an increase in the applicable statutory federal tax rate. |
Organization and Description 18
Organization and Description of Business (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business Paycom Software, Inc. (“Software”) and its wholly-owned subsidiaries (collectively, the “Company”) is a leading provider of comprehensive, cloud-based human capital management (“HCM”) software delivered as Software-as-a-Service. Unless we state otherwise or the context otherwise requires, the terms “we”, “our”, “us” and the “Company” refer to Software and its consolidated subsidiaries. We provide functionality and data analytics that businesses need to manage the complete employment life cycle from recruitment to retirement. Our solution requires virtually no customization and is based on a core system of record maintained in a single database for all HCM functions, including talent acquisition, time and labor management, payroll, talent management and human resources (“HR”) management applications. |
The Reorganization | The Reorganization Software and its wholly-owned subsidiary, Payroll Software Merger Sub, LLC (“Merger Sub”) were formed as Delaware entities on October 31, 2013 and December 23, 2013, respectively, in anticipation of an initial public offering and were wholly-owned subsidiaries of Paycom Payroll Holdings, LLC (“Holdings”) prior to December 31, 2013. On January 1, 2014, we consummated a reorganization pursuant to which (i) affiliates of Welsh, Carson, Anderson & Stowe X, L.P. (“WCAS X”), WCAS Capital Partners IV, L.P. (“WCAS Capital IV”) and WCAS Management Corporation (collectively, “WCAS”), contributed WCAS Paycom Holdings, Inc. (“WCAS Holdings”) and WCAS CP IV Blocker, Inc. (“CP IV Blocker”), which collectively owned all of the Series A Preferred Units of Holdings, to Software in exchange for shares of common stock of Software and (ii) the owners of outstanding Series B Preferred Units of Holdings contributed their Series B Preferred Units of Holdings to Software in exchange for shares of common stock of Software. Immediately after these contributions, Merger Sub merged with and into Holdings with Holdings surviving the merger. Upon consummation of the merger, the remaining holders of outstanding common and incentive units of Holdings received shares of common stock and restricted stock of Software for their common and incentive units by operation of Delaware law and Holdings’ ownership interest in Software was cancelled. Outstanding common units, Series B Preferred Units and incentive units of Holdings, WCAS Holdings and CP IV Blocker were contributed to Software in exchange for, or converted into, an aggregate of 45,708,573 shares of common stock and 8,121,101 shares of restricted stock of Software. Prior to the reorganization, WCAS Holdings held Series C Preferred Units of Holdings in the amount of $46.2 million and WCAS Holdings had a note payable to a related party due April 3, 2017, in the amount of $46.2 million. Following these transactions, all outstanding Series C Preferred Units were eliminated in an intercompany transaction between Holdings and WCAS Holdings, and we assumed the 14% Note due 2017 issued by WCAS Holdings (the “2017 Note”). Following the reorganization, Software became a holding company with its principal assets being the Series B Preferred Units of Holdings and the outstanding capital stock of WCAS Holdings and CP IV Blocker (collectively, the “2014 Reorganization”). |
Initial Public Offering | Initial Public Offering On April 21, 2014, we closed our initial public offering whereby an aggregate of 7,641,750 shares of our common stock were sold to the public (including 4,606,882 shares of common stock issued and sold by us and 3,034,868 shares of common stock sold by certain selling stockholders) at a public offering price of $15.00 per share. We did not receive any proceeds from the sale of shares by the selling stockholders. The total gross proceeds we received from the offering were $69.1 million. After deducting underwriting discounts and commissions and offering expenses payable by us, the aggregate net proceeds we received totaled approximately $62.8 million. We used all of the net proceeds from the offering, together with approximately $3.3 million from existing cash, for the repayment in full of the 2017 Note and the 10% Senior Note due 2022 issued by us to WCAS Capital IV. |
Follow-On Public Offering | Follow-On Public Offering On January 21, 2015, we closed our follow-on public offering, whereby 6,422,750 shares of our common stock were sold to the public by certain selling stockholders at a public offering price of $22.50 per share. We did not receive any proceeds from the sale of these shares. |
Registered Block Trade Transactions | Registered Block Trade Transactions On May 20, 2015, we closed an underwritten secondary offering of 8,000,000 shares of our common stock by WCAS X, WCAS Capital IV, each of our executive officers and certain other selling stockholders at a public offering price of $36.25 per share. We did not receive any proceeds from the sale of these shares. On September 15, 2015, we closed an underwritten secondary offering of 4,500,000 shares of our common stock by WCAS X, WCAS Capital IV, each of our executive officers and certain other selling stockholders at a public offering price of $37.95 per share. On September 23, 2015, the underwriter exercised its option to purchase an additional 675,000 shares from WCAS X and WCAS Capital IV. We did not receive any proceeds from the sale of these shares. |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial statements that permit reduced disclosure for interim periods. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments necessary to fairly present our Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014, our Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2015 and 2014 and our Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2015 and 2014. Such adjustments are of a normal recurring nature. In addition to these normal adjustments, on the Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2014, we combined the accounts “Income tax receivable” and “Income tax payable” and the accounts “Deferred tax assets” and “Deferred tax liabilities” in order to conform to the current period presentation. The information in this Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K that was filed with the SEC on February 26, 2015. The results of operations for the three and nine months ended September 30, 2015 are not necessarily indicative of the results expected for the full fiscal year. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates include income taxes, contingencies, the useful life for property and equipment and intangible assets, the life of our client relationships, the fair value of our stock-based awards and the fair value of our financial instruments, intangible assets and goodwill. These estimates are based on historical experience where applicable and other assumptions that management believes are reasonable under circumstances. As such, actual results could materially differ from these estimates. |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Our significant accounting policies are discussed in “Note 2. Summary of Significant Accounting Policies” in our audited consolidated financial statements for the year ended December 31, 2014, included in the Annual Report on Form 10-K that was filed with the SEC on February 26, 2015. |
Employee Stock Purchase Plan | Employee Stock Purchase Plan An award issued under the Paycom Software, Inc. Employee Stock Purchase Plan (the “ESPP”) is classified as a share based liability and recorded at the fair value of the award. Expense is recognized, net of estimated forfeitures, on a straight line basis over the requisite service period. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued authoritative guidance which included a comprehensive new revenue recognition model that requires revenue to be recognized in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 31, 2016, and early adoption is not permitted. In April 2015, the FASB proposed a one year deferral of the effective date of the new revenue recognition standard for public and non-public entities reporting under U.S. GAAP and on July 9, 2015, the FASB approved the one year deferral. The effective date of the amended standard will begin in periods beginning after December 15, 2017. We are currently evaluating the impact that the standard will have on our condensed consolidated financial statements. In June 2014, the FASB issued authoritative guidance for share-based payments which requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. This update further clarifies that compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable for the period(s) in which the requisite service has already been rendered. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. In April 2015, the FASB issued authoritative guidance for intangibles related to internally developed software. The new guidance will assist entities in evaluating the accounting for fees paid by a customer in a cloud computing arrangement. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. In April 2015, the FASB issued authoritative guidance which simplifies the presentation of debt issuance costs. Under the new guidance, debt issuance costs related to a recognized debt liability will be presented in the Condensed Consolidated Balance Sheets as a direct deduction from the carrying amount of the debt liability. The new guidance is effective for public entities for fiscal years, and interim periods within those years, beginning after December 15, 2015. Accordingly, the standard is effective for us on January 1, 2016. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. Debt issuance costs are currently included on the Condensed Consolidated Balance Sheets as an asset. In July 2015, the FASB issued authoritative guidance which simplifies the measurement of inventory. Under the new guidance, an entity should measure inventory (as defined within the scope of the guidance) at the lower of cost or new realizable value. The new guidance applies to all inventory except inventory measured using last-in, first-out (LIFO) or the retail inventory method. Net realizable value is defined as the estimated selling price in the ordinary course of business, less reasonably predicable costs of completion, disposal and transportation. The new guidance is effective for public companies for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Accordingly, the standard is effective for us on January 1, 2017. We do not anticipate that the adoption of this standard will have a material impact on our condensed consolidated financial statements. |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment and Associated Accumulated Depreciation and Amortization | Property and equipment and associated accumulated depreciation and amortization were as follows: September 30, December 31, 2015 2014 Property and equipment Buildings $ 28,154 $ 28,154 Software and capitalized software costs 11,997 8,671 Computer equipment 10,027 7,638 Rental clocks 8,131 6,596 Furniture, fixtures and equipment 5,049 4,361 Vehicles 421 421 Leasehold improvements 307 174 64,086 56,015 Less: accumulated depreciation and amortization (22,699 ) (17,089 ) 41,387 38,926 Land 8,993 8,993 Construction in process 3,294 - Property and equipment, net $ 53,674 $ 47,919 |
Goodwill and Intangible Asset20
Goodwill and Intangible Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Components of Intangible Assets | All of our intangible assets are considered to have finite lives and, as such, are subject to amortization. The components of intangible assets were as follows: September 30, 2015 Weighted Avg. Remaining Accumulated Useful Life Gross Amortization Net (Years) Intangibles: Customer relationships 1.8 $ 13,997 $ (11,547 ) $ 2,450 Trade name 6.8 3,194 (1,758 ) 1,436 Total $ 17,191 $ (13,305 ) $ 3,886 December 31, 2014 Weighted Avg. Remaining Accumulated Useful Life Gross Amortization Net (Years) Intangibles: Customer relationships 2.5 $ 13,997 $ (10,498 ) $ 3,499 Trade name 7.5 3,194 (1,597 ) 1,597 Total $ 17,191 $ (12,095 ) $ 5,096 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Our long-term debt consisted of the following: September 30, 2015 December 31, 2014 Term note to bank due May 30, 2021 (1) $ 26,081 $ 26,978 Total long-term debt (including current portion) 26,081 26,978 Less: Current portion (875 ) (855 ) Total long-term debt, net $ 25,206 $ 26,123 (1) Our outstanding indebtedness consisted of a term note under the 2021 Consolidated Loan due to Kirkpatrick Bank (the “2021 Consolidated Loan”) with an outstanding principal balance of $26.1 million and $27.0 million as of September 30, 2015 and December 31, 2014, respectively. The 2021 Consolidated Loan matures on May 30, 2021. Under the 2021 Consolidated Loan, interest is payable monthly and accrues at a fixed rate of 4.75% per annum. The 2021 Consolidated Loan is secured by a mortgage covering our headquarters and certain personal property relating to our headquarters. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Income Per Share | The following is a reconciliation of net income and the shares of common stock used in the computation of basic and diluted net income per share (dollars in thousands): Three Months Ended Nine Months Ended September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014 Numerator: Net income $ 3,847 $ 2,690 $ 15,788 $ 3,157 Less: income allocable to participating securities (49 ) — (205 ) — Income allocable to common shares $ 3,798 $ 2,690 $ 15,583 $ 3,157 Add back: undistributed earnings allocable to participating securities 49 — 205 — Less: undistributed earnings reallocated to participating securities (49 ) — (200 ) — Numerator for diluted earnings per share $ 3,798 $ 2,690 $ 15,588 $ 3,157 Denominator: Weighted average common shares outstanding 50,315,455 51,056,462 50,315,455 49,040,344 Adjustment for vested restricted stock 6,735,229 - 5,972,524 - Shares for calculating basic EPS 57,050,684 51,056,462 56,287,979 49,040,344 Dilutive effect of unvested restricted stock 1,317,146 1,921,589 1,483,701 2,182,704 Shares for calculating diluted EPS 58,367,830 52,978,051 57,771,680 51,223,048 Net income per share: Basic $ 0.07 $ 0.05 $ 0.28 $ 0.06 Diluted $ 0.07 $ 0.05 $ 0.27 $ 0.06 |
Organization and Description 23
Organization and Description of Business - Additional Information (Detail) - USD ($) | Sep. 21, 2015 | Sep. 15, 2015 | May. 20, 2015 | Jan. 21, 2015 | Apr. 21, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2014 |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Gross proceeds received from public offering | $ 69,100,000 | $ 62,843,000 | ||||||
IPO [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Common stock issued, shares | 7,641,750 | |||||||
Offering price per share | $ 15 | |||||||
Proceeds from sale of shares received from selling stockholders | $ 0 | |||||||
Proceeds from initial public offering, net of offering costs | $ 62,800,000 | |||||||
Public Offering [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Common stock issued, shares | 6,422,750 | |||||||
Offering price per share | $ 22.50 | |||||||
Proceeds from sale of common stock under public offering | $ 0 | |||||||
Secondary Offering [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Common stock issued, shares | 4,500,000 | 8,000,000 | ||||||
Offering price per share | $ 37.95 | $ 36.25 | ||||||
Proceeds from sale of common stock under public offering | $ 0 | $ 0 | ||||||
Additional purchase of common shares | 675,000 | |||||||
Paycom Software, Inc. [Member] | IPO [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Common stock issued, shares | 4,606,882 | |||||||
Executive Officers And Other Selling Shareholders [Member] | IPO [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Common stock sold by selling stockholders | 3,034,868 | |||||||
Restricted Stock [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Conversion of units to shares | 8,121,101 | |||||||
Series C Preferred Units [Member] | WCAS Capital Partners IV, L.P., [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Preferred units held, amount | $ 46,200,000 | |||||||
Common Stock [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Conversion of units to shares | 45,708,573 | |||||||
14% Note due 2017 [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Debt instrument, interest rate | 14.00% | |||||||
14% Note due 2017 [Member] | WCAS Capital Partners IV, L.P., [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Notes payable, due date | Apr. 3, 2017 | |||||||
Notes payable, amount | $ 46,200,000 | |||||||
10% Senior Note due 2022 [Member] | WCAS Capital Partners IV, L.P., [Member] | IPO [Member] | ||||||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||||||
Debt instrument, interest rate | 10.00% | |||||||
Repayment for senior notes | $ 3,300,000 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment and Associated Accumulated Depreciation and Amortization (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 64,086 | $ 56,015 |
Less: accumulated depreciation and amortization | (22,699) | (17,089) |
Property and equipment, net | 53,674 | 47,919 |
Buildings [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 28,154 | 28,154 |
Software and Capitalized Software Costs [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 11,997 | 8,671 |
Computer Equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 10,027 | 7,638 |
Rental Clocks [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 8,131 | 6,596 |
Furniture, Fixtures and Equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 5,049 | 4,361 |
Vehicles [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 421 | 421 |
Leasehold Improvements [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 307 | 174 |
Excluded Land and Construction in Process [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, net | 41,387 | 38,926 |
Land [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, net | 8,993 | $ 8,993 |
Construction in Process [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, net | $ 3,294 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Property Plant And Equipment [Line Items] | ||||
Depreciation and amortization | $ 1,457,000 | $ 1,159,000 | $ 4,180,000 | $ 3,322,000 |
Interest cost paid | 300,000 | 300,000 | 900,000 | 900,000 |
Interest costs capitalized | 0 | 0 | 0 | 400,000 |
Computer software development costs capitalized | 1,100,000 | 600,000 | 2,700,000 | 1,300,000 |
Property and Equipment [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Depreciation and amortization | $ 2,000,000 | $ 1,400,000 | $ 5,600,000 | $ 4,000,000 |
Goodwill and Intangible Asset26
Goodwill and Intangible Assets, Net - Additional Information (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Jun. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||||
Goodwill | $ 51,889,000 | $ 51,889,000 | $ 51,889,000 | |||
Goodwill, Impairment Loss | $ 0 | $ 0 | ||||
Weighted average remaining useful life | 3 years 7 months 6 days | |||||
Amortization of intangible assets | $ 400,000 | $ 400,000 | $ 1,200,000 | $ 1,200,000 |
Goodwill and Intangible Asset27
Goodwill and Intangible Assets, Net - Components of Intangible Assets (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2014 | |
Finite Lived Intangible Assets [Line Items] | ||
Weighted average remaining useful life | 3 years 7 months 6 days | |
Gross | $ 17,191 | $ 17,191 |
Accumulated amortization | (13,305) | (12,095) |
Net | $ 3,886 | $ 5,096 |
Customer Relationships [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average remaining useful life | 1 year 9 months 18 days | 2 years 6 months |
Gross | $ 13,997 | $ 13,997 |
Accumulated amortization | (11,547) | (10,498) |
Net | $ 2,450 | $ 3,499 |
Trade Name [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted average remaining useful life | 6 years 9 months 18 days | 7 years 6 months |
Gross | $ 3,194 | $ 3,194 |
Accumulated amortization | (1,758) | (1,597) |
Net | $ 1,436 | $ 1,597 |
Funds Held for Clients and Cl28
Funds Held for Clients and Client Funds Obligation - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2015 | |
Accounts Payable And Accrued Expenses [Line Items] | |
Maximum holding period for funds collected from clients | 120 days |
Minimum [Member] | |
Accounts Payable And Accrued Expenses [Line Items] | |
Disbursement period of funds collected from clients | 1 day |
Maximum [Member] | |
Accounts Payable And Accrued Expenses [Line Items] | |
Disbursement period of funds collected from clients | 30 days |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | |
Schedule Of Capitalization Longterm Debt [Line Items] | |||
Total long-term debt (including current portion) | $ 26,081 | $ 26,978 | |
Less: Current portion | (875) | (855) | |
Total long-term debt, net | 25,206 | 26,123 | |
2021 Consolidated Loan [Member] | |||
Schedule Of Capitalization Longterm Debt [Line Items] | |||
Term note to bank due May 30, 2021 | [1] | 26,081 | 26,978 |
Total long-term debt (including current portion) | $ 26,100 | $ 27,000 | |
[1] | Our outstanding indebtedness consisted of a term note under the 2021 Consolidated Loan due to Kirkpatrick Bank (the “2021 Consolidated Loan”) with an outstanding principal balance of $26.1 million and $27.0 million as of September 30, 2015 and December 31, 2014, respectively. The 2021 Consolidated Loan matures on May 30, 2021. Under the 2021 Consolidated Loan, interest is payable monthly and accrues at a fixed rate of 4.75% per annum. The 2021 Consolidated Loan is secured by a mortgage covering our headquarters and certain personal property relating to our headquarters. |
Long-Term Debt - Schedule of 30
Long-Term Debt - Schedule of Long-Term Debt (Parenthetical) (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Schedule Of Capitalization Longterm Debt [Line Items] | ||
Total long-term debt (including current portion) | $ 26,081 | $ 26,978 |
2021 Consolidated Loan [Member] | ||
Schedule Of Capitalization Longterm Debt [Line Items] | ||
Debt instrument maturity date | May 30, 2021 | |
Total long-term debt (including current portion) | $ 26,100 | $ 27,000 |
Debt instrument, interest rate | 4.75% |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) | May. 13, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | |||
Total long-term debt, including current portion | $ 26,081,000 | $ 26,978,000 | |
Construction Loan [Member] | |||
Debt Instrument [Line Items] | |||
Loan, principal amount | $ 11,000,000 | ||
Construction loan, outstanding borrowings | $ 0 | ||
Construction loan, percentage of appraised value of constructed property | 80.00% | ||
Construction loan, maturity date description | The Construction Loan matures on the earlier of the completion of construction or November 13, 2016, with variable interest accruing at the greater of (i) the prime rate, plus 50 basis points or (ii) 4.0%. | ||
Debt Instrument, floor interest rate | 4.00% | ||
Construction Loan [Member] | Term Loan [Member] | |||
Debt Instrument [Line Items] | |||
Construction loan, maturity date description | At maturity, the outstanding principal balance of the Construction Loan will be automatically converted to a 78-month term loan. | ||
Maturity period of term loan | 78 months | ||
Prime Rate | Construction Loan [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument basis spread on variable rate | 0.50% | ||
London Interbank Offered Rate L I B O R | Construction Loan [Member] | Term Loan [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument basis spread on variable rate | 2.25% | ||
2021 Consolidated Loan [Member] | |||
Debt Instrument [Line Items] | |||
Debt instrument, restrictive covenants | Maintaining a fixed charge coverage ratio of EBITDA to fixed charges (defined as current maturities of long-term debt, interest expense, rent expense and distributions), as defined in the agreement, of greater than 1.2 to 1.0 | ||
Total long-term debt, including current portion | $ 26,100,000 | $ 27,000,000 | |
2021 Consolidated Loan [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Debt coverage ratio of indebtedness | 120.00% |
Employee Savings Plan and Emp32
Employee Savings Plan and Employee Stock Purchase Plan - Additional Information (Detail) - USD ($) $ in Millions | May. 05, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Defined Contribution Plan Disclosure [Line Items] | |||||
401(k) eligibility minimum service period | 90 days | ||||
401(k) description of plan contributions | Contribution equal to 100% of the first 1% of salary deferrals and 50% of salary deferrals between 2% and 6%, up to a maximum matching contribution of 3.5% of salary each plan year for our employees. | ||||
Employee vested percentage in salary deferrals and roll over contributions | 100.00% | ||||
Minimum period for vesting 100% contributions | 2 years | ||||
Minimum period for vesting of discretionary contributions | 2 years | ||||
Matching contribution amount | $ 0.6 | $ 0.4 | $ 1.8 | $ 1.3 | |
Employee Stock Purchase Plan [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Employees Company's common stock shares purchase limit percentage | 10.00% | ||||
Purchase of shares of common stock | 24,935 | ||||
Compensation expense related to ESPP | $ 0.1 | $ 0.2 | |||
Share of common stock purchase maximum | 2,000,000 | ||||
Maximum number of shares that may be acquired by a participant | 2,000 | ||||
After Two Years Of Employment [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Matching contributions, vesting percentage | 100.00% | ||||
One Hundred Percent Match For Percent Of Participants Contribution [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Employer contribution percentage | 100.00% | ||||
Percentage of salary deferrals | 1.00% | ||||
50% Matching Contribution [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Employer contribution percentage | 50.00% | ||||
Minimum [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
401(k) eligible age of employee | 21 years | ||||
Minimum [Member] | 50% Matching Contribution [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Percentage of salary deferrals | 2.00% | ||||
Maximum [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Percentage of salary deferrals | 3.50% | ||||
Maximum [Member] | Employee Stock Purchase Plan [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Purchase price of common stock expressed as a percentage of its fair market value | 85.00% | ||||
Maximum [Member] | 50% Matching Contribution [Member] | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Percentage of salary deferrals | 6.00% |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted Net Income Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Numerator: | ||||
Net income | $ 3,847 | $ 2,690 | $ 15,788 | $ 3,157 |
Less: income allocable to participating securities | (49) | (205) | ||
Income allocable to common shares | 3,798 | 2,690 | 15,583 | 3,157 |
Add back: undistributed earnings allocable to participating securities | 49 | 205 | ||
Less: undistributed earnings reallocated to participating securities | (49) | (200) | ||
Numerator for diluted earnings per share | $ 3,798 | $ 2,690 | $ 15,588 | $ 3,157 |
Denominator: | ||||
Weighted average common shares outstanding | 50,315,455 | 51,056,462 | 50,315,455 | 49,040,344 |
Adjustment for vested restricted stock | 6,735,229 | 5,972,524 | ||
Shares for calculating basic EPS | 57,050,684 | 51,056,462 | 56,287,979 | 49,040,344 |
Dilutive effect of unvested restricted stock | 1,317,146 | 1,921,589 | 1,483,701 | 2,182,704 |
Shares for calculating diluted EPS | 58,367,830 | 52,978,051 | 57,771,680 | 51,223,048 |
Net income per share: | ||||
Basic | $ 0.07 | $ 0.05 | $ 0.28 | $ 0.06 |
Diluted | $ 0.07 | $ 0.05 | $ 0.27 | $ 0.06 |
Stockholders' Equity and Ince34
Stockholders' Equity and Incentive Compensation - Additional Information (Detail) - USD ($) | Jul. 08, 2015 | Mar. 02, 2015 | Dec. 01, 2014 | Dec. 31, 2013 | Sep. 30, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Reclassification adjustment recorded of deficit to additional paid in capital | $ 29,300,000 | ||||||
Compensation expense recognized | $ 200,000 | ||||||
Total unrecognized compensation cost related to unvested restricted stock | $ 300,000 | $ 300,000 | $ 700,000 | ||||
Unrecognized compensation expected to be recognized | 2 years 1 month 6 days | ||||||
Risk free interest rate | 2.20% | ||||||
Expected volatility interest rate | 26.00% | ||||||
Dividend yield percentage | 0.00% | ||||||
Cash proceeds from conversion of restricted stock | $ 0 | ||||||
Software and Capitalized Software Costs [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Capitalized compensation cost | 31,000 | $ 4,000 | |||||
Vest 50% upon reaching a total enterprise value of $1.4 billion [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Market-based vesting percentage, restricted shares | 50.00% | ||||||
Total enterprise value | $ 1,400,000,000 | ||||||
Vest 50% upon reaching a total enterprise value of $1.8 billion [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Market-based vesting percentage, restricted shares | 50.00% | ||||||
Total enterprise value | $ 1,800,000,000 | ||||||
Common Stock [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Conversion of units to shares | 45,708,573 | ||||||
Restricted Stock [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Conversion of units to shares | 8,121,101 | ||||||
Compensation expense recognized | 300,000 | ||||||
Total unrecognized compensation cost related to unvested restricted stock | 17,100,000 | $ 17,100,000 | |||||
Unrecognized compensation expected to be recognized | 2 years 2 months 12 days | ||||||
Restricted Stock [Member] | LTIP [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Compensation expense recognized | $ 1,400,000 | $ 1,400,000 | |||||
Shares issued | 741,931 | ||||||
Restricted Stock [Member] | Market-based Vesting Conditions [Member] | LTIP [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares issued | 477,200 | ||||||
Restricted Stock [Member] | Time-based Vesting Conditions [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock awards grant date fair value | $ 33.33 | ||||||
Restricted Stock [Member] | Time-based Vesting Conditions [Member] | Minimum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation award vesting period | 3 years | ||||||
Restricted Stock [Member] | Time-based Vesting Conditions [Member] | Maximum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation award vesting period | 5 years | ||||||
Restricted Stock [Member] | Time-based Vesting Conditions [Member] | LTIP [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares issued | 264,731 | ||||||
Restricted Stock [Member] | Vest 50% when Company reaches a total enterprise value of $2.65 billion [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Market-based vesting percentage, restricted shares | 50.00% | ||||||
Total enterprise value | $ 2,650,000,000 | ||||||
Share-based compensation award vesting period | 2 years 3 months 18 days | ||||||
Restricted stock awards grant date fair value | $ 21.76 | ||||||
Restricted Stock [Member] | Vest 50% when Company reaches a total enterprise value of $3.5 billion [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Market-based vesting percentage, restricted shares | 50.00% | ||||||
Total enterprise value | $ 3,500,000,000 | ||||||
Share-based compensation award vesting period | 4 years 2 months 12 days | ||||||
Restricted stock awards grant date fair value | $ 27.24 |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Detail) - 417 Oakbend, LP [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Related Party Transaction [Line Items] | ||||
Payments for rent | $ 0.1 | $ 0.1 | $ 0.2 | $ 0.2 |
Registration and legal fees expenses | $ 1 | |||
Chief Sales Officer [Member] | ||||
Related Party Transaction [Line Items] | ||||
General partnership ownership interest in related party, percentage | 0.01% | 0.01% | ||
Limited partnership interest in related party, percentage | 10.49% | 10.49% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Jun. 25, 2015USD ($) | Mar. 31, 2010USD ($)Job | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) |
Other Commitments [Line Items] | |||||||
Payments for legal settlements | $ 20,000 | ||||||
Logo change agreement period | 60 days | ||||||
Liability for deferred rent | $ 800,000 | $ 800,000 | $ 800,000 | ||||
Operating lease rent expense | $ 1,100,000 | $ 1,000,000 | $ 3,300,000 | $ 2,400,000 | |||
Minimum [Member] | |||||||
Other Commitments [Line Items] | |||||||
Operating lease expiration year | 2,015 | ||||||
Maximum [Member] | |||||||
Other Commitments [Line Items] | |||||||
Operating lease expiration year | 2,021 | ||||||
Oklahoma City Economic Development Trust [Member] | |||||||
Other Commitments [Line Items] | |||||||
Up-front job creation payment from Trust | $ 2,000,000 | ||||||
Term of agreement | 5 years | ||||||
Oklahoma City Economic Development Trust [Member] | Minimum [Member] | |||||||
Other Commitments [Line Items] | |||||||
Number of jobs created within a 5 year period | Job | 492 | ||||||
Average first year wage | $ 37,000 | ||||||
Capital investment in the project | $ 15,000,000 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Estimated effective income tax rate | 41.79% | 38.57% | 42.13% | 39.11% |