Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Oct. 25, 2019 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-36316 | |
Entity Registrant Name | AgroFresh Solutions, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-4007249 | |
Entity Address, Address Line One | 510-530 Walnut Street, Suite 1350 | |
Entity Address, City or Town | Philadelphia | |
Entity Address, State or Province | PA | |
Entity Address, Postal Zip Code | 19106 | |
City Area Code | 267 | |
Local Phone Number | 317-9139 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 50,957,878 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Entity Central Index Key | 0001592016 | |
Amendment Flag | false | |
Common Stock | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Trading Symbol | AGFS | |
Security Exchange Name | NASDAQ | |
Warrants | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Warrants, each warrant exercisable for one share of Common Stock at an exercise price of $11.50 | |
Trading Symbol | AGFSW | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Current Assets: | ||
Cash and cash equivalents | $ 18,746 | $ 34,852 |
Accounts receivable, net of allowance for doubtful accounts of $2,358 and $2,336, respectively | 72,074 | 67,942 |
Inventories | 24,199 | 24,807 |
Other current assets | 14,648 | 15,608 |
Total Current Assets | 129,667 | 143,209 |
Property and equipment, net | 13,643 | 13,289 |
Goodwill | 6,091 | 6,670 |
Intangible assets, net | 676,938 | 711,967 |
Deferred income tax assets | 10,095 | 7,332 |
Other assets | 22,492 | 16,820 |
TOTAL ASSETS | 858,926 | 899,287 |
Current Liabilities: | ||
Accounts payable | 10,257 | 7,530 |
Current portion of long-term debt | 4,748 | 6,419 |
Income taxes payable | 4,374 | 4,815 |
Accrued expenses and other current liabilities | 41,397 | 45,340 |
Total Current Liabilities | 60,776 | 64,104 |
Long-term debt | 398,619 | 400,309 |
Other noncurrent liabilities | 40,733 | 32,066 |
Deferred income tax liabilities | 17,555 | 30,232 |
Total liabilities | 517,683 | 526,711 |
Commitments and contingencies (see Note 19) | ||
Stockholders’ Equity: | ||
Common stock, par value $0.0001; 400,000,000 shares authorized, 51,592,959 and 51,071,573 shares issued and 50,931,578 and 50,410,192 outstanding at September 30, 2019 and December 31, 2018, respectively | 5 | 5 |
Preferred stock; par value $0.0001, 1 share authorized and outstanding | 0 | 0 |
Treasury stock; par value $0.0001, 661,381 shares at September 30, 2019 and December 31, 2018, respectively | (3,885) | (3,885) |
Additional paid-in capital | 538,075 | 535,819 |
Accumulated deficit | (170,388) | (138,789) |
Accumulated other comprehensive loss | (30,491) | (28,837) |
Total AgroFresh Stockholders’ Equity | 333,316 | 364,313 |
Non-controlling interest | 7,927 | 8,263 |
Total Stockholders' Equity | 341,243 | 372,576 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 858,926 | $ 899,287 |
Par value of common stock (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 1 | 1 |
Treasury stock (in shares) | 661,381 | 661,381 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Allowance for doubtful accounts | $ 2,358 | $ 2,336 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 51,592,959 | 51,071,573 |
Common stock, shares outstanding (in shares) | 50,931,578 | 50,410,192 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 1 | 1 |
Preferred stock, shares outstanding (in shares) | 1 | 1 |
Treasury stock (in shares) | 661,381 | 661,381 |
Treasury Stock | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Net sales | $ 48,972 | $ 68,698 | $ 109,095 | $ 125,470 |
Cost of sales (excluding amortization, shown separately below) | 13,892 | 16,662 | 31,516 | 32,910 |
Gross profit | 35,080 | 52,036 | 77,579 | 92,560 |
Research and development expenses | 2,566 | 3,491 | 9,720 | 10,293 |
Selling, general, and administrative expenses | 14,998 | 18,212 | 47,044 | 50,133 |
Amortization of intangibles | 11,754 | 12,002 | 35,136 | 34,342 |
Impairment of long lived assets | 0 | 0 | 992 | 0 |
Change in fair value of contingent consideration | (229) | 307 | 128 | 543 |
Operating income (loss) | 5,991 | 18,024 | (15,441) | (2,751) |
Other (expense) income | (81) | (189) | (119) | 419 |
Gain (loss) on foreign currency exchange | 54 | (4,731) | (2,884) | 472 |
Interest expense, net | (8,606) | (9,132) | (26,021) | (26,250) |
(Loss) income before income taxes | (2,642) | 3,972 | (44,465) | (28,110) |
Income taxes (benefit) expense | (5,653) | 1,018 | (12,530) | 214 |
Net income (loss) including non-controlling interests | 3,011 | 2,954 | (31,935) | (28,324) |
Less: Net loss attributable to non-controlling interests | (278) | (516) | (336) | (442) |
Net income (loss) attributable to AgroFresh Solutions, Inc | $ 3,289 | $ 3,470 | $ (31,599) | $ (27,882) |
Net income (loss) per share: | ||||
Basic (in dollars per share) | $ 0.06 | $ 0.06 | $ (0.64) | $ (0.57) |
Diluted (in dollars per share) | $ 0.06 | $ 0.06 | $ (0.64) | $ (0.57) |
Weighted average shares outstanding: | ||||
Basic (in shares) | 50,227,590 | 49,853,181 | 50,138,835 | 49,671,648 |
Diluted (in shares) | 50,288,304 | 50,309,979 | 50,138,835 | 49,671,648 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 3,011 | $ 2,954 | $ (31,935) | $ (28,324) |
Other comprehensive (loss) income: | ||||
Unrealized gain on hedging activity, net of tax of $24, $158, $24 and $989, respectively | 83 | 83 | ||
Unrealized gain on hedging activity, net of tax of $24, $158, $24 and $989, respectively | 558 | 3,509 | ||
Recognition of gain on hedging activity reclassified to net loss, net of tax of $78 and $235, respectively | (278) | (834) | ||
Recognition of gain on hedging activity reclassified to net loss, net of tax of $78 and $235, respectively | 0 | 0 | ||
Foreign currency translation adjustments | (3,823) | (11,088) | (903) | (24,123) |
Comprehensive loss | $ (1,007) | $ (7,576) | $ (33,589) | $ (48,938) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Unrealized gain on hedging activity, tax | $ 24 | $ 24 | ||
Unrealized gain on hedging activity, tax | $ 158 | $ 989 | ||
Realized gain on hedging activity reclassified to net loss, tax | $ 78 | $ 235 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Non-Controlling Interest |
Balances - beginning at Dec. 31, 2017 | $ 416,080 | $ 0 | $ 5 | $ (3,885) | $ 533,015 | $ (108,729) | $ (12,769) | $ 8,443 |
Balances - beginning (in shares) at Dec. 31, 2017 | 1 | 51,002,234 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Stock-based compensation | 2,028 | 2,028 | ||||||
Issuance of stock, net of forfeitures (in shares) | 98,357 | |||||||
Comprehensive income (loss) | (48,938) | (27,882) | (20,614) | (442) | ||||
Balances - ending at Sep. 30, 2018 | 369,170 | $ 0 | $ 5 | (3,885) | 535,043 | (136,611) | (33,383) | 8,001 |
Balances - ending (in shares) at Sep. 30, 2018 | 1 | 51,100,591 | ||||||
Balances - beginning at Jun. 30, 2018 | 376,477 | $ 0 | $ 5 | (3,885) | 534,774 | (140,099) | (22,834) | 8,516 |
Balances - beginning (in shares) at Jun. 30, 2018 | 1 | 51,148,343 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Stock-based compensation | 269 | 269 | ||||||
Issuance of stock, net of forfeitures (in shares) | (47,752) | |||||||
Comprehensive income (loss) | (7,576) | 3,488 | (10,549) | (515) | ||||
Balances - ending at Sep. 30, 2018 | 369,170 | $ 0 | $ 5 | (3,885) | 535,043 | (136,611) | (33,383) | 8,001 |
Balances - ending (in shares) at Sep. 30, 2018 | 1 | 51,100,591 | ||||||
Balances - beginning at Dec. 31, 2018 | 372,576 | $ 0 | $ 5 | (3,885) | 535,819 | (138,789) | (28,837) | 8,263 |
Balances - beginning (in shares) at Dec. 31, 2018 | 1 | 51,071,573 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Stock-based compensation | 2,256 | 2,256 | ||||||
Issuance of stock, net of forfeitures (in shares) | 521,386 | |||||||
Comprehensive income (loss) | (33,589) | (31,599) | (1,654) | (336) | ||||
Balances - ending at Sep. 30, 2019 | 341,243 | $ 0 | $ 5 | (3,885) | 538,075 | (170,388) | (30,491) | 7,927 |
Balances - ending (in shares) at Sep. 30, 2019 | 1 | 51,592,959 | ||||||
Balances - beginning at Jun. 30, 2019 | 341,434 | $ 0 | $ 5 | (3,885) | 537,259 | (173,677) | (26,473) | 8,205 |
Balances - beginning (in shares) at Jun. 30, 2019 | 1 | 51,620,770 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Stock-based compensation | 816 | 816 | ||||||
Issuance of stock, net of forfeitures (in shares) | (27,811) | |||||||
Comprehensive income (loss) | (1,007) | 3,289 | (4,018) | (278) | ||||
Balances - ending at Sep. 30, 2019 | $ 341,243 | $ 0 | $ 5 | $ (3,885) | $ 538,075 | $ (170,388) | $ (30,491) | $ 7,927 |
Balances - ending (in shares) at Sep. 30, 2019 | 1 | 51,592,959 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (31,935) | $ (28,324) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 36,692 | 35,486 |
Provision for bad debts | 215 | 599 |
Stock-based compensation | 2,256 | 1,965 |
Pension expense | 0 | 71 |
Impairment of intangible assets | 992 | 0 |
Amortization of deferred financing costs | 2,032 | 1,842 |
Interest income on interest rate swap | (1,070) | 4,041 |
Accretion of contingent consideration | 2,669 | 2,894 |
Change in fair value of contingent consideration | 128 | 543 |
Deferred income taxes | (14,499) | (97) |
Loss on sales of property | 2 | 0 |
Other | 0 | 81 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,499) | (30,124) |
Inventories | (4,424) | 260 |
Prepaid expenses and other current assets | (1,429) | (4,137) |
Accounts payable | 3,855 | (7,208) |
Accrued expenses and other liabilities | (2,958) | 7,115 |
Income taxes payable | (95) | (1,467) |
Other assets and liabilities | 384 | 245 |
Net cash used in operating activities | (8,684) | (16,215) |
Cash flows from investing activities: | ||
Cash paid for property and equipment | (3,271) | (3,179) |
Asset acquisition | 0 | (1,587) |
Other investments | (250) | 0 |
Net cash used in investing activities | (3,521) | (4,766) |
Cash flows from financing activities: | ||
Payment of Dow liabilities settlement | 0 | (10,000) |
Repayment of long-term debt | (5,056) | (3,517) |
Net cash used in financing activities | (5,056) | (13,517) |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | 1,682 | (4,013) |
Net decrease in cash and cash equivalents and restricted cash | (15,579) | (38,511) |
Cash and cash equivalents and restricted cash, beginning of period | 34,852 | 64,533 |
Cash and cash equivalents and restricted cash, end of period | 19,273 | 26,022 |
Cash paid for: | ||
Cash paid for interest | 18,007 | 23,280 |
Cash paid for income taxes | 2,469 | 5,304 |
Supplemental schedule of non-cash investing and financing activities: | ||
Accrued purchases of property and equipment | 62 | 316 |
Right of use assets obtained in exchange for new lease liabilities | 376 | 0 |
Reconciliation of cash and cash equivalents and restricted cash: | ||
Total cash and cash equivalents and restricted cash | $ 34,852 | $ 64,533 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business AgroFresh Solutions, Inc. (the “Company”) is a global leader in delivering innovative food preservation and waste reduction solutions for fresh produce. The Company is empowering the food industry with Smarter Freshness TM , a range of integrated solutions designed to help growers, packers and retailers improve produce freshness and quality while reducing waste. The Company’s solutions range from near-harvest with Harvista TM and LandSpring TM , to its marquee SmartFresh TM Quality System, which includes SmartFresh TM , FreshCloud TM and ActiMist TM , working together to maintain the quality of stored produce. The Company has a controlling interest in Tecnidex Fruit Protection, S.A.U. (“Tecnidex”), a leading provider of post-harvest fungicides, waxes, and sanitizers for the citrus market. Additionally, the Company’s initial retail solution, RipeLock TM , optimizes banana ripening for the benefit of retailers and consumers. The Company has key products registered in over 50 countries, supports approximately 3,900 direct customers and services over 25,000 storage rooms globally. The end markets that the Company serves are seasonal and are generally aligned with the seasonal growing patterns of the Company’s customers. For those customers growing, harvesting or storing apples, the Company’s primary market, the peak season in the southern hemisphere is the first and second quarters of each year, while the peak season in the northern hemisphere is the third and fourth quarters of each year. Within each half-year period (i.e., January through June for the southern hemisphere, and July through December for the northern hemisphere) the apple growing season has historically occurred during both quarters. A variety of factors, including weather, may affect the timing of the growing, harvesting and storing patterns of the Company’s customers and therefore shift the consumption of the Company’s services and products between the first and second quarters primarily in the southern hemisphere or between the third and fourth quarters primarily in the northern hemisphere. The Company was originally incorporated as Boulevard Acquisition Corp. (“Boulevard”), a blank check company, in Delaware on October 24, 2013, and was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination. On July 31, 2015, the Company completed a Business Combination (refer to Note 3) and changed its name to AgroFresh Solutions, Inc. Prior to consummation of the Business Combination, the Company’s efforts were limited to organizational activities, its initial public offering and related financings, and the search for suitable business acquisition transactions. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission. These financial statements include all adjustments that are necessary for a fair presentation of the Company's condensed consolidated results of operations, financial condition and cash flows for the periods shown, including normal, recurring accruals and other items. The condensed consolidated results of operations for the interim periods presented are not necessarily indicative of results for the full year. For additional information, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2018. Adoption of Highly Inflationary Accounting in Argentina GAAP requires the use of highly inflationary accounting for countries whose cumulative three-year inflation rate exceeds 100 percent. The Company has been closely monitoring the inflation data and currency volatility in Argentina, where there are multiple data sources for measuring and reporting inflation. In the second quarter of 2018, the Argentine peso rapidly devalued relative to the U.S. dollar, which along with increased inflation, indicated that the three-year cumulative inflation rate in that country exceeded 100 percent as of June 30, 2018. As a result, the Company has elected to adopt highly inflationary accounting as of July 1, 2018 for its subsidiary in Argentina. Under highly inflationary accounting, the functional currency of the Company's subsidiary in Argentina became the U.S. dollar, and its income statement and balance sheet will be measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on Argentine peso-denominated monetary assets and liabilities will be reflected in earnings. As of September 30, 2019, the Company’s subsidiary in Argentina had a net asset position of $6.7 million. Net sales attributable to Argentina were approximately 6% and 5% of the Company’s consolidated net sales for the nine months ended September 30, 2019 and 2018, respectively. Disaggregation of Revenue The Company disaggregates revenue from contracts with customers into geographic region, product and timing of transfer of goods and services. The Company determined that disaggregating revenue into these categories achieves the disclosure objective of depicting how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Revenues for the three months ended September 30, 2019 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 19,726 $ 22,377 $ 1,680 $ 1,605 $ 45,388 Fungicides, waxes, coatings, sanitizers — 2,857 198 — 3,055 Other* 218 86 108 117 529 $ 19,944 $ 25,320 $ 1,986 $ 1,722 $ 48,972 Pattern of Revenue Recognition Products transferred at a point in time $ 19,802 $ 25,238 $ 1,877 $ 1,605 $ 48,522 Services transferred over time 142 82 109 117 450 $ 19,944 $ 25,320 $ 1,986 $ 1,722 $ 48,972 Revenues for the three months ended September 30, 2018 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 26,029 $ 34,284 $ 779 $ 2,387 $ 63,479 Fungicides, waxes, coatings, sanitizers 270 4,047 — — 4,317 Other* 614 134 154 — 902 $ 26,913 $ 38,465 $ 933 $ 2,387 $ 68,698 Pattern of Revenue Recognition Products transferred at a point in time $ 26,774 $ 38,342 $ 907 $ 2,176 $ 68,199 Services transferred over time 139 123 26 211 499 $ 26,913 $ 38,465 $ 933 $ 2,387 $ 68,698 Revenues for the nine months ended September 30, 2019 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 23,084 $ 31,965 $ 27,503 $ 11,287 $ 93,839 Fungicides, waxes, coatings, sanitizers — 11,365 1,458 — 12,823 Other* 954 927 381 171 2,433 $ 24,038 $ 44,257 $ 29,342 $ 11,458 $ 109,095 Pattern of Revenue Recognition Products transferred at a point in time $ 23,380 $ 43,374 $ 29,159 $ 11,309 $ 107,222 Services transferred over time 658 883 183 149 1,873 $ 24,038 $ 44,257 $ 29,342 $ 11,458 $ 109,095 Revenues for the nine months ended September 30, 2018 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 28,378 $ 43,508 $ 26,185 $ 12,228 $ 110,299 Fungicides, waxes, coatings, biocides 270 12,981 — — 13,251 Other* 1,236 349 335 — 1,920 $ 29,884 $ 56,838 $ 26,520 $ 12,228 $ 125,470 Pattern of Revenue Recognition Products and equipment transferred at a point in time $ 29,701 $ 56,658 $ 26,448 $ 11,784 $ 124,591 Services transferred over time 183 180 72 444 879 $ 29,884 $ 56,838 $ 26,520 $ 12,228 $ 125,470 *Other includes FreshCloud, technical services and sales-type leases related to Tecnidex. ——————————————————————————————— (1) North America includes the United States and Canada. (2) EMEA includes Europe, the Middle East, and Africa. (3) Latin America includes Argentina, Brazil, Chile, Costa Rica, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Peru, and Uruguay. (4) Asia Pacific includes Australia, China, India, Japan, New Zealand, the Philippines, South Korea, Taiwan, and Thailand. Contract Assets and Liabilities ASC 606 requires an entity to present a revenue contract as a contract asset when the entity performs its obligations under the contract by transferring goods or services to a customer before the customer pays consideration or before payment is due. ASC 606 also requires an entity to present a revenue contract as a contract liability in instances when a customer pays consideration, or an entity has a right to an amount of consideration that is unconditional (e.g. receivable), before the entity transfers a good or service to the customer. The following table presents changes in the Company’s contract assets and liabilities during the nine months ended September 30, 2019 and the twelve months ended December 31, 2018: (in thousands) Balance at Additions Deductions Balance at, Contract assets: Unbilled revenue $ 1,956 $ 8,958 $ (6,911) $ 4,003 Contract liabilities: Deferred revenue $ 1,280 $ 2,810 $ (2,761) $ 1,329 (in thousands) Balance at Additions Deductions Balance at, Contract assets: Unbilled revenue $ 739 $ 7,117 $ (5,900) $ 1,956 Contract liabilities: Deferred revenue $ 100 $ 4,428 $ (3,248) $ 1,280 The Company recognizes contract assets in the form of unbilled revenue in instances where services are performed by the Company but not billed by period end. The Company recognizes contract liabilities in the form of deferred revenue in instances where a customer pays in advance for future services to be performed by the Company. The Company generally receives payments from its customers based on standard terms and conditions. No significant changes or impairment losses occurred to contract balances during the three months ended September 30, 2019. Amounts reclassified from unbilled revenue to accounts receivable for the nine months ended September 30, 2019 and for the year ended December 31, 2018 were $6.9 million and $5.9 million, respectively. Amounts reclassified from deferred revenue to revenue for the nine months ended September 30, 2019 and the year ended December 31, 2018 were $2.8 million and $3.2 million, respectively. Recently Issued Accounting Standards and Pronouncements In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-12 Targeted Improvements to Accounting for Hedging Activities. This update makes more financial and nonfinancial hedging strategies eligible for hedge accounting. It also amends the presentation and disclosure requirements and changes how companies assess effectiveness. This update will be effective for the Company for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted upon its issuance. The Company adopted the new ASU as of January 1, 2019 and it did not have a material impact on the Company's financial statements. In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation, Scope of Modification Accounting . ASU 2017-09 addresses the changes to the terms and conditions of share-based awards. ASU 2017-09 is effective for periods beginning after December 15, 2017 and interim periods therein on a modified retrospective basis. The Company adopted the new ASU as of January 1, 2018, and it did not have a material impact on the financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations, Clarifying the Definition of a Business . The new accounting guidance clarifies the definition of a business and provides additional guidance to assist entities with evaluating whether transactions should be accounted for as asset acquisitions (or asset disposals) or business combinations (or disposals of a business). Under the new guidance, an entity first determines whether substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this criterion is met, the transaction should be accounted for as an asset acquisition as opposed to a business combination. This distinction is important because the accounting for an asset acquisition significantly differs from the accounting for a business combination. The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2017, with early adoption permitted. During the second quarter of 2018, the Company adopted this standard in connection with the acquisition of Verigo (refer to Note 3). In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other, which simplifies the test for goodwill impairment. The guidance is effective for the Company beginning in the first quarter of fiscal year 2020. Early adoption is permitted for interim or annual goodwill impairments tests after January 1, 2017. This standard will impact future financial statements when adopted if the Company has impairment to its goodwill. In February 2016, the FASB issued ASU 2016-02, Leases . The main objective of this update is to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This ASU is effective for fiscal years beginning after December 15, 2018, including |
Business Combinations and Asset
Business Combinations and Asset Acquisition | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Business Combinations and Asset Acquisition | Business Combinations and Asset Acquisition Business Combination with Dow On July 31, 2015 (the "Closing Date"), the Company consummated a business combination (the “Business Combination”) pursuant to the Stock Purchase Agreement, dated April 30, 2015 (the “Purchase Agreement”), by and between the Company and The Dow Chemical Company ("Dow") providing for the acquisition by the Company of the AgroFresh business from Dow, resulting in AgroFresh Inc. becoming a wholly-owned, indirect subsidiary of the Company. Pursuant to the Purchase Agreement, the Company paid the following consideration to Rohm and Haas Company (“R&H”), a subsidiary of Dow: (i) 17.5 million shares of common stock and (ii) $635 million in cash. Pursuant to a Tax Receivables Agreement among the Company, Dow, R&H and AgroFresh Inc. entered into in connection with the consummation of the Business Combination, as amended on April 4, 2017 (as so amended, the “Tax Receivables Agreement”), the Company is required to pay to Dow 50% of the annual tax savings, if any, in U.S. federal, state and local income tax or franchise tax that the Company actually realizes as a result of the increase in tax basis of the AgroFresh assets resulting from a Section 338(h)(10) election that the Company and Dow made in connection with the Business Combination. On April 4, 2017, the Company entered into an agreement (the “Amendment Agreement”) with Dow, R&H, Boulevard Acquisition Sponsor, LLC (the “Sponsor”) and certain other parties. Pursuant to the Amendment Agreement, among other things, the Company agreed to pay Dow the aggregate amount of $20.0 million, of which $10.0 million was paid on April 4, 2017 and the remaining $10.0 million was paid on January 31, 2018, in full satisfaction of the Company’s obligations with respect to (i) the working capital adjustment under the Purchase Agreement, (ii) certain transfer and value added tax reimbursement obligations under the Purchase Agreement, and (iii) the amount payable to Dow pursuant to the Tax Receivables Agreement on account of the 2015 tax year. During the three months ended March 31, 2018, these liabilities were extinguished. Acquisition of Tecnidex On November 7, 2017, the Company entered into a definitive agreement to acquire a controlling interest in Tecnidex. The transaction was closed on December 1, 2017. Tecnidex is a leading provider of post-harvest fungicides, waxes, coatings, and sanitizers for the citrus market, with clients in 18 countries. For over 35 years, Tecnidex has been helping fruit and vegetable producers offer clean, safe and high-quality products to their regional clients. The acquisition was accounted for as a purchase in accordance with ASC 805, Business Combination . At the effective date of the acquisition, the Company agreed to pay holders of Tecnidex an estimated $25.0 million in cash for 75% of the outstanding capital stock, of which $20.0 million was paid on December 1, 2017. In 2018, the purchase price was finalized as $22.3 million after giving effect to working capital, net debt and other adjustments. The remaining $2.3 million was paid during 2018. In accordance with the acquisition method of accounting, the Company has allocated the purchase price to the estimated fair values of the identifiable assets acquired and liabilities assumed, with any excess allocated to goodwill. The preliminary assessment of fair value of the contingent consideration payments on the acquisition date was approximately $0.7 million and was estimated by applying a probability-based income approach utilizing an appropriate discount rate. This estimation was based on significant inputs that are not observable in the market, referred to as Level 3 inputs. During 2018 there was an adjustment made to consideration payable to holders of Tecnidex which resulted in a measurement period adjustment of $2.8 million to the purchase price allocation. Acquisition of Verigo On April 9, 2018, the Company acquired the assets of Comm-n-Sense Corp., d/b/a Verigo ("Verigo"), pursuant to the terms of an Asset Purchase Agreement, for approximately $1.8 million. Verigo, a privately-held organization, provided hardware in the form of wireless data receptors along with cloud-based software to synchronize data pulled from the hardware to support and provide tools for monitoring environmental and quality factors, such as temperature and relative humidity. The transaction was accounted for as an asset acquisition because substantially all of the fair value of the gross assets acquired was concentrated in a single asset, the acquired software. Asset acquisitions are accounted for using a cost accumulation approach, whereby the total consideration paid is allocated to the individual assets acquired and liabilities assumed on a relative fair value basis. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company is a party to ongoing agreements with Dow, a related party, including, but not limited to, operating-related agreements for certain transition services. In connection with the Transition Services Agreement, the Company paid Dow a $5.0 million set-up fee which was amortized over the period during which the services were expected to be provided. The Company incurred expenses for such services for the nine months ended September 30, 2019 and September 30, 2018 as follows: (in thousands) Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Ongoing costs of transition services agreement $ 90 $ 251 Other expenses — 1,484 Total incurred expenses $ 90 $ 1,735 As of September 30, 2019 and September 30, 2018, the Company had an outstanding payable to Dow of $0.1 million and $0.5 million, respectively, related to the Transition Services Agreement. Refer to Note 3 During 2016, the Company made a minority investment in RipeLocker, LLC ("RipeLocker"), a company led by George Lobisser, a director of the Company. In February 2019, the Company made a further minority investment in RipeLocker. On November 29, 2016, the Company entered into a Mutual Services Agreement (the “Services Agreement”) with George Lobisser and RipeLocker. Pursuant to the Services Agreement, (i) the Company agreed to provide RipeLocker with technical support, in the form of access to the Company’s research and development personnel for a specified number of hours for purposes of providing advice and input relating to RipeLocker’s products and services, and (ii) Mr. Lobisser agreed to provide consulting services to the Company as may be reasonably requested by the Company from time to time. The Services Agreement provided for Mr. Lobisser to receive a consulting fee of $5,000 per full day for time spent performing consulting services under the Services Agreement (pro-rated for any partial day), plus reimbursement for out-of-pocket expenses, provided that for each hour of technical support provided by the Company to RipeLocker, Mr. Lobisser agreed to provide one-half hour of consulting services for no consideration. In February 2017, the Company and Mr. Lobisser agreed to substantially curtail any mutual consulting services to be provided under the Services Agreement, and that any further services would be provided at no charge. For the nine months ended September 30, 2019 and 2018, there were no material amounts paid and as of September 30, 2019, there were no material amounts owed to RipeLocker or Mr. Lobisser for consulting services. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | InventoriesInventories at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Raw material $ 2,852 $ 1,286 Work-in-process 4,996 4,749 Finished goods 15,306 17,535 Supplies 1,045 1,237 Total inventories $ 24,199 $ 24,807 |
Other Current Assets
Other Current Assets | 9 Months Ended |
Sep. 30, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Current Assets | Other Current Assets The Company's other current assets at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, VAT receivable $ 6,531 $ 7,854 Prepaid income tax asset 4,813 5,090 Prepaid and other current assets 3,304 2,664 Total other current assets $ 14,648 $ 15,608 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands, except for useful life data) Useful life September 30, December 31, Buildings and leasehold improvements 7-20 $ 6,030 $ 4,647 Machinery & equipment 1-12 10,487 8,193 Furniture 1-12 2,656 2,712 Construction in progress 1,701 1,744 20,874 17,296 Less: accumulated depreciation (7,231) (4,007) Total property and equipment, net $ 13,643 $ 13,289 Depreciation expense was $0.6 million and $0.4 million for the three months ended September 30, 2019 and 2018, respectively, and $1.6 million and $1.2 million, for the nine months ended September 30, 2019 and 2018, respectively. Depreciation expense is recorded in cost of sales, selling, general and administrative expense and research and development expense in the condensed consolidated statements of operations. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Changes in the carrying amount of goodwill for the nine months ended September 30, 2019 and the twelve months ended December 31, 2018 were as follows: (in thousands) September 30, December 31, Balance as of Beginning balance $ 6,670 $ 9,402 Measurement period adjustment — (2,807) Foreign currency translation (579) 75 Balance as of Ending balance $ 6,091 $ 6,670 See Note 3 for a description of the measurement period adjustment. The Company’s intangible assets at September 30, 2019 and December 31, 2018 consisted of the following: September 30, 2019 December 31, 2018 (in thousands) Gross Carrying Accumulated Impairment Net Gross Carrying Accumulated Impairment Net Other intangible assets: Developed technology $ 759,205 $ (165,730) $ — $ 593,475 $ 759,290 $ (134,151) $ — $ 625,139 In-process research and development 39,000 (6,681) — 32,319 39,000 (5,055) — 33,945 Trade name 27,216 — — 27,216 28,507 — (2,600) 25,907 Service provider network 2,000 — — 2,000 2,000 — — 2,000 Customer relationships 17,866 (1,958) — 15,908 19,872 (2,198) — 17,674 Software 10,604 (3,638) (992) 5,974 9,405 (2,161) — 7,244 Other 100 (54) — 46 100 (42) — 58 Total intangible assets $ 855,991 $ (178,061) $ (992) $ 676,938 $ 858,174 $ (143,607) $ (2,600) $ 711,967 During the Company's annual impairment testing conducted for the year ended December 31, 2018, the Company recorded an impairment charge of $2.6 million on its SmartFresh trade name. During the nine months ended September 30, 2019, the Company had an impairment charge of $1.0 million associated with the Verigo software following a partnership agreement with a new technology provider. At September 30, 2019, the weighted-average amortization periods remaining for developed technology, in-process R&D, customer relationships, software and other was 15.6, 13.0, 15.0, 3.0, and 2.8 years, respectively. At September 30, 2019, the weighted-average amortization period remaining for these finite-lived intangible assets was 15.4 years. Estimated annual amortization expense for finite-lived intangible assets subsequent to September 30, 2019 is as follows: (in thousands) Amount 2019 (remaining) $ 10,893 2020 43,545 2021 43,295 2022 43,150 2023 43,142 Thereafter 463,697 Total $ 647,722 Amortization expense for intangible assets was $11.8 million and $12.0 million for the three months ended September 30, 2019 and 2018, respectively, and $35.1 million and $34.3 million, for the nine months ended September 30, 2019 and 2018, respectively. |
Accrued and Other Current Liabi
Accrued and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued and Other Current Liabilities | Accrued and Other Current LiabilitiesThe Company’s accrued and other current liabilities at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Tax amortization benefit contingency $ 10,844 $ 11,098 Additional consideration due seller 451 379 Accrued compensation and benefits 9,136 10,192 Accrued rebates payable 4,302 3,616 Insurance premium financing payable 1,247 721 Severance 638 971 Deferred revenue 1,329 1,280 Accrued taxes 4,030 5,316 Accrued interest 5,086 — Lease liability 1,534 — Other 2,800 11,767 Total accrued and other current liabilities $ 41,397 $ 45,340 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt The Company’s debt, net of unamortized deferred issuance costs, at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Total Term Loan outstanding $ 406,937 $ 410,125 Unamortized deferred issuance costs (4,474) (6,168) Tecnidex loan outstanding 904 2,771 Less: Amounts due within one year 4,748 6,419 Total long-term debt due after one year $ 398,619 $ 400,309 At September 30, 2019, the Company evaluated the amount recorded under the Term Loan (defined below) and determined that the fair value was approximately $376.4 million. The fair value of the debt is based on quoted inactive market prices and is therefore classified as Level 2 within the valuation hierarchy. The Term Loan is presented net of deferred issuance costs, which are amortized using the effective interest method over the term of the Term Loan. Gross deferred issuance costs at the inception of the Term Loan were $12.9 million and as of September 30, 2019 there were $4.5 million of unamortized deferred issuance costs. Scheduled principal repayments of debt subsequent to September 30, 2019 are as follows: (in thousands) Amount 2019 (remaining) $ 1,213 2020 4,792 2021 401,836 Total $ 407,841 Credit Facility On July 31, 2015, in connection with the consummation of the Business Combination, AgroFresh Inc. as the borrower and its parent, AF Solutions Holdings LLC (“AF Solutions Holdings”), a wholly-owned subsidiary of the Company, as the guarantor, entered into a Credit Agreement with Bank of Montreal, as administrative agent (as subsequently amended, the “Credit Facility”). The Credit Facility consists of a $425.0 million term loan (the “Term Loan”), with an amortization equal to 1.00% per year, and a revolving loan facility (the “Revolving Loan”). On January 31, 2019, the Revolving Loan was amended to reduce the total availability from $25.0 million to $12.5 million, to extend the maturity date from July 31, 2019 to December 31, 2020, and to amend certain financial covenants. The Revolving Loan includes a $10.0 million letter-of-credit sub-facility, issuances against which reduce the available capacity for borrowing. The Term Loan has a scheduled maturity date of July 31, 2021. The interest rates on borrowings under the facilities are either the alternate base rate plus 3.75% or LIBOR plus 4.75% per annum, with a 1.00% LIBOR floor (with step-downs in respect of borrowings under the Revolving Loan dependent upon the achievement of certain financial ratios). The obligations under the Credit Facility are secured by liens on substantially all of the assets of (a) AgroFresh Inc. and its direct wholly-owned domestic subsidiaries, and (b) AF Solutions Holdings, including the common stock of AgroFresh Inc. The net proceeds of the Term Loan were used to fund a portion of the purchase price payable to Dow in connection with the Business Combination. Amounts available under the Revolving Loan may also be used for working capital, general corporate purposes, and other uses, all as more fully set forth in the Credit Agreement. At September 30, 2019, there was $406.9 million outstanding under the Term Loan and no balance outstanding under the Revolving Loan. As of the Closing Date, the Company incurred approximately $12.9 million in debt issuance costs related to the Term Loan and $1.3 million in costs related to the Revolving Loan. The debt issuance costs associated with the Term Loan were capitalized against the principal balance of the debt, and the Revolving Loan costs were capitalized in Other Assets. All issuance costs will be accreted through interest expense for the duration of each respective debt facility. The interest expense related to the amortization of the debt issuance costs during the three and nine months ended September 30, 2019 was approximately $0.6 million and $1.7 million, respectively. The interest expense related to the amortization of the debt issuance costs during the three and nine months ended September 30, 2018 was approximately $0.6 million and $1.8 million, respectively. Certain restrictive covenants are contained in the Credit Facility, which includes the Revolving Loan, and the Company was in compliance with these covenants as of September 30, 2019. The Company had full availability to draw under the Revolving Loan as of September 30, 2019. The Company entered into an interest rate swap contract in August 2019 to hedge interest rate risk associated with the Term Loan. During the three months ended September 30, 2019, an unrealized gain of $0.1 million was recognized in connection with this swap. The interest rate swap contract matures on December 31, 2020. Beginning with the year ended December 31, 2016, the Company is required to prepay Term Loan Borrowings and Incremental Term Loan Borrowings in an aggregate amount equal to 50% of the "Excess Cash Flow" (as defined in the Credit Facility) for the fiscal year; provided that such amount of the Excess Cash Flow in any fiscal year shall be reduced by (i) the aggregate amount of prepayments of Term Loans and Incremental Term Loans made, (ii) to the extent accompanied by permanent reductions of Revolving Commitments, the aggregate amount of prepayments of Revolving Loans (other than prepayments financed with the proceeds of Indebtedness), and (iii) repaid borrowings of Revolving Loans made on the Effective Date to account for any additional original issue discount or upfront fees that are implemented pursuant to the Fee Letter provided further that, prepayments of Term Loan Borrowings and Incremental Term Loan Borrowings shall only be required if 50% of the Excess Cash Flow for such fiscal year exceeds $5.0 million. There are no amounts due under this provision as of September 30, 2019. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company enters into lease agreements for certain facilities and vehicles that are primarily used in the ordinary course of business. These leases are accounted for as operating leases, whereby lease expense is recognized on a straight-line basis over the term of the lease. Most leases include an option to extend or renew the lease term. The exercise of the renewal option is at the Company's discretion. The operating lease liability includes lease payments related to options to extend or renew the lease term if the Company is reasonably certain of exercising those options. The Company, in determining the present value of lease payments, utilizes either the rate implicit in the lease if that rate is readily determinable or the Company’s incremental secured borrowing rate commensurate with the term of the underlying lease. Lease expense is primarily included in general and administrative expenses in the condensed consolidated statements of operations. Additional information regarding the Company's operating leases is as follows: (in thousands) Three Months Ended September 30, 2019 Nine Months Ended Operating Lease Cost Operating leases $ 591 $ 1,849 Short-term leases (1) 5 52 Total lease expense $ 596 $ 1,901 (1) Leases with an initial term of twelve months or less are not recorded on the balance sheet. Other information on operating leases Cash payments included in operating cash flows $ 1,625 Weighted average discount rate 9.33 % Weighted average remaining lease term in years 5.53 The following table presents the contractual maturities of the Company's lease liabilities as of September 30, 2019: (in thousands) Lease Liability Remainder of 2019 $ 540 2020 1,905 2021 1,641 2022 1,487 2023 1,277 2024 and thereafter 2,364 Total undiscounted lease payments $ 9,214 Less: present value adjustment 2,075 Operating lease liability $ 7,139 The following table presents the future minimum lease payments as of December 31, 2018 under noncancellable operating leases: (in thousands) Future lease Payments 2019 $ 3,413 2020 2,058 2021 1,790 2022 1,640 2023 1,242 Thereafter 2,396 Total $ 12,539 |
Other Noncurrent Liabilities
Other Noncurrent Liabilities | 9 Months Ended |
Sep. 30, 2019 | |
Liabilities, Other than Long-term Debt, Noncurrent [Abstract] | |
Other Noncurrent Liabilities | Other Noncurrent Liabilities The Company’s other noncurrent liabilities at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Tax amortization benefit contingency $ 32,363 $ 29,369 Lease liability 5,605 — Other (1) 2,765 2,697 Total other noncurrent liabilities $ 40,733 $ 32,066 |
Severance
Severance | 9 Months Ended |
Sep. 30, 2019 | |
Compensation Related Costs [Abstract] | |
Severance | SeveranceSeverance expense was $0.3 million and $1.7 million for the three months ended September 30, 2019 and 2018, respectively, and $1.0 million and $2.1 million for the nine months ended September 30, 2019 and 2018, respectively. This amount, which does not include stock compensation expense, was recorded in selling, general and administrative expense in the condensed consolidated statements of loss. As of September 30, 2019 and December 31, 2018, the Company had a $0.6 million and $1.0 million severance liability, respectively. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity The authorized common stock of the Company consists of 400,000,000 shares with a par value of $0.0001 per share. Holders of the Company’s common stock are entitled to one vote for each share of common stock. As of September 30, 2019, there were 50,931,578 shares of common stock outstanding. As of September 30, 2019, there were warrants to purchase 15,983,072 shares of the Company’s common stock outstanding at a strike price of $11.50. Of the 15,983,072 warrants, 9,823,072 were issued as part of the units sold in the Company's initial public offering in February 2014 (1,201,928 warrants were subsequently repurchased during 2015) and 6,160,000 warrants were sold in a private placement at the time of such public offering. In connection with and as a condition to the consummation of the Business Combination, the Company issued Dow one share of Series A Preferred Stock. Dow, voting as a separate class, is entitled to appoint one director to the Company’s board of directors for so long as Dow beneficially holds 10% or more of the aggregate amount of the outstanding shares of common stock and non-voting common stock of the Company. The Series A Preferred Stock has no other rights. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based Compensation | Stock-based Compensation In July 2015, the Company adopted the 2015 Incentive Compensation Plan (as amended, the “Plan”), pursuant to which the Compensation Committee of the Company is authorized to grant up to 7,150,000 shares to officers and employees of the Company, in the form of equity-based awards, including time or performance based options and restricted stock. In June 2019, the Company's shareholders approved the 2019 Employee Stock Purchase Plan (the "ESPP"), which was effective July 1, 2019. 500,000 shares of common stock are reserved for issuance under the ESPP. As of September 30, 2019, no shares had been issued under the ESPP. Stock compensation expense for equity-classified and liability-classified awards for the three and nine months ended September 30, 2019 was $1.0 million and $2.1 million, respectively. Stock compensation expense for equity-classified and liability-classified awards for the three and nine months ended September 30, 2018 was $0.2 million and $2.0 million, respectively. Stock compensation expense is recognized in cost of goods sold, selling, general and administrative expenses, and research and development expenses. At September 30, 2019, there was $4.4 million of unrecognized compensation cost relating to outstanding unvested equity instruments expected to be recognized over the weighted average period of 1.8 years. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. The Company had a loss for the nine months ended September 30, 2019 and 2018. Therefore, the effect of stock-based awards including options, restricted stock, restricted stock units, and warrants outstanding at September 30, 2019 and September 30, 2018, respectively, have not been included in the computation of diluted loss per share because their inclusion would have been anti-dilutive. The following is a reconciliation of the weighted-average common shares outstanding used for the computation of basic and diluted net income (loss) per common share: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Basic weighted-average common shares outstanding 50,227,590 49,853,181 50,138,835 49,671,648 Effect of dilutive options, performance stock units and restricted stock 60,714 456,798 — — Diluted weighted-average shares outstanding 50,288,304 50,309,979 50,138,835 49,671,648 Securities that could potentially be dilutive are excluded from the computation of diluted earnings (loss) per share when a loss from continuing operations exists, when the exercise price exceeds the average closing price of the Company's common stock during the period, or for contingently issued shares, if the contingency is not met at the end of the reporting period, because their inclusion would result in an anti-dilutive effect on per share amounts. The following represent the number of shares that could potentially dilute basic earnings per share in the future: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Stock-based compensation awards (1) : Stock options 1,028,583 322,158 949,987 322,158 Restricted stock to non-directors 749,510 336,286 624,930 278,289 Restricted stock to directors — 84,427 — 72,655 Warrants: Private placement warrants 6,160,000 6,160,000 6,160,000 6,160,000 Public warrants 9,823,072 9,823,072 9,823,072 9,823,072 (1) SARs and Phantom Shares are payable in cash so will have no impact on number of shares |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The provision for income taxes consists of provisions for federal, state, and foreign incomes taxes. The effective tax rates for the periods ended September 30, 2019, and September 30, 2018, reflect the Company’s expected tax rate on reported income from continuing operations before income tax and tax adjustments. The Company operates in a global environment with significant operations in the U.S. and various other jurisdictions outside the U.S. Accordingly, the consolidated income tax rate is a composite rate reflecting the Company’s earnings and the applicable tax rates in the various jurisdictions where the Company operates. On December 22, 2017, the Tax Cuts and Jobs Act (“TCJA”) was enacted in the U.S. The TCJA represents sweeping changes in U.S. tax law. Among other changes in tax law, the TCJA permanently reduced the U.S. corporate income tax rate to 21% beginning in 2018, imposed a one-time repatriation tax on deferred foreign earnings, established a participation exemption system by allowing a 100% dividends received deduction on qualifying dividends paid by foreign subsidiaries, limited deductions for net interest expense, and expanded the U.S. taxation of foreign earned income to include “global intangible low-taxed income” (“GILTI”). The Company's effective tax rate for the three and nine months ended September 30, 2019 was 214.0% and 28.2%, respectively, compared to the effective tax rate for the three and nine months ended September 30, 2018 of 25.6% and (0.8)%, respectively. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Segment InformationThe authoritative guidance for disclosures about segments of an enterprise establishes standards for reporting information about segments. It defines operating segments as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision-maker in deciding how to allocate resources and in assessing performance. We currently operate and manage our business as two operating segments. Our chief operating decision-makers allocate resources and assess performance of the business for each segment. Accordingly, we consider ourselves to have two operating and reportable segments (i) AgroFresh core and (ii) Tecnidex. AgroFresh core business is providing produce preservation and waste reduction solutions for growers and packers. Its products include SmartFresh, Harvista, RipeLock and FreshCloud. Tecnidex is a provider of fungicides, sanitizers, waxes, and coatings primarily focused on the citrus market. Our chief operating decision-makers do not evaluate operating segments using asset or liability information. The following table presents a breakdown of our revenues and gross profit based on reportable segments for the three and nine months ended September 30, 2019 and 2018. (in thousands) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended AgroFresh Core Revenues $ 45,917 $ 64,647 $ 96,272 $ 112,489 Gross Profit 34,182 51,149 72,679 87,861 Tecnidex Revenues 3,055 4,051 12,823 12,981 Gross Profit 898 887 4,900 4,699 Total Revenues $ 48,972 $ 68,698 $ 109,095 $ 125,470 Total Gross Profit $ 35,080 $ 52,036 $ 77,579 $ 92,560 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is currently involved in various claims and legal actions that arise in the ordinary course of business. The Company has recorded reserves for loss contingencies based on the specific circumstances of each case. Such reserves are recorded when it is probable that a loss has been incurred as of the balance sheet date and can be reasonably estimated. Although the results of litigation and claims can never be predicted with certainty, the Company does not believe that the ultimate resolution of these actions will have a material adverse effect on the Company’s business, financial condition or results of operations. On October 14, 2019, the Company was awarded a verdict of $31.1 million in damages, related to, among other things, trade secret misappropriation and willful patent infringement, in its litigation against Decco Post-Harvest, Inc. ("Decco") and Decco's parent company, UPL Limited. The award is subject to post-verdict review by the Court and any appeals that may be taken by the parties in the future. Purchase Commitments The Company has various purchasing contracts for contract manufacturing and research and development services which are based on the requirements of the business. Generally, the contracts are at prices not in excess of current market prices and do not commit the business to obligations outside the normal customary terms for similar contracts. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Liabilities Measured at Fair Value on a Recurring Basis The following table presents the fair value of the Company’s financial instruments that are measured at fair value on a recurring basis as of September 30, 2019: (in thousands) Level 1 Level 2 Level 3 Total Tax amortization benefit contingency (1) $ — $ — $ 43,207 $ 43,207 Contingent consideration (2) — — 451 451 Liability-classified stock compensation (3) — — 218 218 Interest rate swap (4) $ — $ (106) $ — $ (106) Total $ — $ (106) $ 43,876 $ 43,770 The following table presents the fair value of the Company’s financial instruments that are measured at fair value on a recurring basis as of December 31, 2018: (in thousands) Level 1 Level 2 Level 3 Total Tax amortization benefit contingency (1) $ — $ — $ 40,467 $ 40,467 Contingent consideration (2) — — 379 379 Liability-classified stock compensation (3) — — 550 550 Total $ — $ — $ 41,396 $ 41,396 (1) The fair value of the tax amortization benefit contingency is measured using an income approach based on the Company’s best estimate of the undiscounted cash payments to be made, using an estimated tax rate of 21.5% and discounted to present value utilizing an appropriate market discount rate. (2) The fair value of the contingent consideration related to the Tecnidex acquisition. (3) The fair value of the stock appreciation rights was measured using a Black Scholes pricing model during the nine months ended September 30, 2019. The fair value of time based phantom shares is based on the fair value of the Company's common stock. The fair value of performance based phantom shares was measured using a Monte Carlo pricing model during the nine months ended September 30, 2019. The valuation technique used did not change during the nine months ended September 30, 2019. (4) The derivative assets and liabilities relate to an interest rate derivative that is measured at fair value using observable market inputs such as interest rates, our own credit risks as well as an evaluation of the counterparts' credit risks. There were no transfers between Level 1 and Level 2 and no transfers out of Level 3 of the fair value hierarchy during the nine months ended September 30, 2019. At September 30, 2019, the Company evaluated the amount recorded under the Term Loan and determined that the fair value was approximately $376.4 million. The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable approximate fair value. Changes in Financial Instruments Measured at Level 3 Fair Value on a Recurring Basis The following table presents the changes during the period presented in our Level 3 financial instrument liabilities that are measured at fair value on a recurring basis. (in thousands) Tax amortization benefit contingency Contingent consideration related to acquisition Liability-classified stock compensation Interest rate swap Total Balance, December 31, 2018 $ 40,467 $ 379 $ 550 $ — $ 41,396 Accretion 2,669 — — — 2,669 Tecnidex earnout activity — 72 — — 72 Stock compensation activity — — (332) — (332) Mark-to-market adjustment 71 — — (106) (35) Balance, September 30, 2019 $ 43,207 $ 451 $ 218 $ (106) $ 43,770 |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policy) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and in accordance with the rules and regulations of the Securities and Exchange Commission. These financial statements include all adjustments that are necessary for a fair presentation of the Company's condensed consolidated results of operations, financial condition and cash flows for the periods shown, including normal, recurring accruals and other items. The condensed consolidated results of operations for the interim periods presented are not necessarily indicative of results for the full year. For additional information, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2018. |
Revenue Recognition | Adoption of Highly Inflationary Accounting in Argentina GAAP requires the use of highly inflationary accounting for countries whose cumulative three-year inflation rate exceeds 100 percent. The Company has been closely monitoring the inflation data and currency volatility in Argentina, where there are multiple data sources for measuring and reporting inflation. In the second quarter of 2018, the Argentine peso rapidly devalued relative to the U.S. dollar, which along with increased inflation, indicated that the three-year cumulative inflation rate in that country exceeded 100 percent as of June 30, 2018. As a result, the Company has elected to adopt highly inflationary accounting as of July 1, 2018 for its subsidiary in Argentina. Under highly inflationary accounting, the functional currency of the Company's subsidiary in Argentina became the U.S. dollar, and its income statement and balance sheet will be measured in U.S. dollars using both current and historical rates of exchange. The effect of changes in exchange rates on Argentine peso-denominated monetary assets and liabilities will be reflected in earnings. As of September 30, 2019, the Company’s subsidiary in Argentina had a net asset position of $6.7 million. Net sales attributable to Argentina were approximately 6% and 5% of the Company’s consolidated net sales for the nine months ended September 30, 2019 and 2018, respectively. Disaggregation of Revenue The Company disaggregates revenue from contracts with customers into geographic region, product and timing of transfer of goods and services. The Company determined that disaggregating revenue into these categories achieves the disclosure objective of depicting how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Revenues for the three months ended September 30, 2019 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 19,726 $ 22,377 $ 1,680 $ 1,605 $ 45,388 Fungicides, waxes, coatings, sanitizers — 2,857 198 — 3,055 Other* 218 86 108 117 529 $ 19,944 $ 25,320 $ 1,986 $ 1,722 $ 48,972 Pattern of Revenue Recognition Products transferred at a point in time $ 19,802 $ 25,238 $ 1,877 $ 1,605 $ 48,522 Services transferred over time 142 82 109 117 450 $ 19,944 $ 25,320 $ 1,986 $ 1,722 $ 48,972 Revenues for the three months ended September 30, 2018 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 26,029 $ 34,284 $ 779 $ 2,387 $ 63,479 Fungicides, waxes, coatings, sanitizers 270 4,047 — — 4,317 Other* 614 134 154 — 902 $ 26,913 $ 38,465 $ 933 $ 2,387 $ 68,698 Pattern of Revenue Recognition Products transferred at a point in time $ 26,774 $ 38,342 $ 907 $ 2,176 $ 68,199 Services transferred over time 139 123 26 211 499 $ 26,913 $ 38,465 $ 933 $ 2,387 $ 68,698 Revenues for the nine months ended September 30, 2019 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 23,084 $ 31,965 $ 27,503 $ 11,287 $ 93,839 Fungicides, waxes, coatings, sanitizers — 11,365 1,458 — 12,823 Other* 954 927 381 171 2,433 $ 24,038 $ 44,257 $ 29,342 $ 11,458 $ 109,095 Pattern of Revenue Recognition Products transferred at a point in time $ 23,380 $ 43,374 $ 29,159 $ 11,309 $ 107,222 Services transferred over time 658 883 183 149 1,873 $ 24,038 $ 44,257 $ 29,342 $ 11,458 $ 109,095 Revenues for the nine months ended September 30, 2018 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 28,378 $ 43,508 $ 26,185 $ 12,228 $ 110,299 Fungicides, waxes, coatings, biocides 270 12,981 — — 13,251 Other* 1,236 349 335 — 1,920 $ 29,884 $ 56,838 $ 26,520 $ 12,228 $ 125,470 Pattern of Revenue Recognition Products and equipment transferred at a point in time $ 29,701 $ 56,658 $ 26,448 $ 11,784 $ 124,591 Services transferred over time 183 180 72 444 879 $ 29,884 $ 56,838 $ 26,520 $ 12,228 $ 125,470 *Other includes FreshCloud, technical services and sales-type leases related to Tecnidex. ——————————————————————————————— (1) North America includes the United States and Canada. (2) EMEA includes Europe, the Middle East, and Africa. (3) Latin America includes Argentina, Brazil, Chile, Costa Rica, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Peru, and Uruguay. (4) Asia Pacific includes Australia, China, India, Japan, New Zealand, the Philippines, South Korea, Taiwan, and Thailand. Contract Assets and Liabilities ASC 606 requires an entity to present a revenue contract as a contract asset when the entity performs its obligations under the contract by transferring goods or services to a customer before the customer pays consideration or before payment is due. ASC 606 also requires an entity to present a revenue contract as a contract liability in instances when a customer pays consideration, or an entity has a right to an amount of consideration that is unconditional (e.g. receivable), before the entity transfers a good or service to the customer. The following table presents changes in the Company’s contract assets and liabilities during the nine months ended September 30, 2019 and the twelve months ended December 31, 2018: (in thousands) Balance at Additions Deductions Balance at, Contract assets: Unbilled revenue $ 1,956 $ 8,958 $ (6,911) $ 4,003 Contract liabilities: Deferred revenue $ 1,280 $ 2,810 $ (2,761) $ 1,329 (in thousands) Balance at Additions Deductions Balance at, Contract assets: Unbilled revenue $ 739 $ 7,117 $ (5,900) $ 1,956 Contract liabilities: Deferred revenue $ 100 $ 4,428 $ (3,248) $ 1,280 |
Recently Issued Accounting Standards and Pronouncements | Recently Issued Accounting Standards and Pronouncements In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-12 Targeted Improvements to Accounting for Hedging Activities. This update makes more financial and nonfinancial hedging strategies eligible for hedge accounting. It also amends the presentation and disclosure requirements and changes how companies assess effectiveness. This update will be effective for the Company for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted upon its issuance. The Company adopted the new ASU as of January 1, 2019 and it did not have a material impact on the Company's financial statements. In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation, Scope of Modification Accounting . ASU 2017-09 addresses the changes to the terms and conditions of share-based awards. ASU 2017-09 is effective for periods beginning after December 15, 2017 and interim periods therein on a modified retrospective basis. The Company adopted the new ASU as of January 1, 2018, and it did not have a material impact on the financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations, Clarifying the Definition of a Business . The new accounting guidance clarifies the definition of a business and provides additional guidance to assist entities with evaluating whether transactions should be accounted for as asset acquisitions (or asset disposals) or business combinations (or disposals of a business). Under the new guidance, an entity first determines whether substantially all of the fair value of the assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this criterion is met, the transaction should be accounted for as an asset acquisition as opposed to a business combination. This distinction is important because the accounting for an asset acquisition significantly differs from the accounting for a business combination. The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2017, with early adoption permitted. During the second quarter of 2018, the Company adopted this standard in connection with the acquisition of Verigo (refer to Note 3). In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other, which simplifies the test for goodwill impairment. The guidance is effective for the Company beginning in the first quarter of fiscal year 2020. Early adoption is permitted for interim or annual goodwill impairments tests after January 1, 2017. This standard will impact future financial statements when adopted if the Company has impairment to its goodwill. In February 2016, the FASB issued ASU 2016-02, Leases . The main objective of this update is to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This ASU is effective for fiscal years beginning after December 15, 2018, including |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of disaggregated revenue | Revenues for the three months ended September 30, 2019 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 19,726 $ 22,377 $ 1,680 $ 1,605 $ 45,388 Fungicides, waxes, coatings, sanitizers — 2,857 198 — 3,055 Other* 218 86 108 117 529 $ 19,944 $ 25,320 $ 1,986 $ 1,722 $ 48,972 Pattern of Revenue Recognition Products transferred at a point in time $ 19,802 $ 25,238 $ 1,877 $ 1,605 $ 48,522 Services transferred over time 142 82 109 117 450 $ 19,944 $ 25,320 $ 1,986 $ 1,722 $ 48,972 Revenues for the three months ended September 30, 2018 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 26,029 $ 34,284 $ 779 $ 2,387 $ 63,479 Fungicides, waxes, coatings, sanitizers 270 4,047 — — 4,317 Other* 614 134 154 — 902 $ 26,913 $ 38,465 $ 933 $ 2,387 $ 68,698 Pattern of Revenue Recognition Products transferred at a point in time $ 26,774 $ 38,342 $ 907 $ 2,176 $ 68,199 Services transferred over time 139 123 26 211 499 $ 26,913 $ 38,465 $ 933 $ 2,387 $ 68,698 Revenues for the nine months ended September 30, 2019 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 23,084 $ 31,965 $ 27,503 $ 11,287 $ 93,839 Fungicides, waxes, coatings, sanitizers — 11,365 1,458 — 12,823 Other* 954 927 381 171 2,433 $ 24,038 $ 44,257 $ 29,342 $ 11,458 $ 109,095 Pattern of Revenue Recognition Products transferred at a point in time $ 23,380 $ 43,374 $ 29,159 $ 11,309 $ 107,222 Services transferred over time 658 883 183 149 1,873 $ 24,038 $ 44,257 $ 29,342 $ 11,458 $ 109,095 Revenues for the nine months ended September 30, 2018 (in thousands) Region North America EMEA Latin America Asia Pacific (4) Total Revenue Product 1-MCP based $ 28,378 $ 43,508 $ 26,185 $ 12,228 $ 110,299 Fungicides, waxes, coatings, biocides 270 12,981 — — 13,251 Other* 1,236 349 335 — 1,920 $ 29,884 $ 56,838 $ 26,520 $ 12,228 $ 125,470 Pattern of Revenue Recognition Products and equipment transferred at a point in time $ 29,701 $ 56,658 $ 26,448 $ 11,784 $ 124,591 Services transferred over time 183 180 72 444 879 $ 29,884 $ 56,838 $ 26,520 $ 12,228 $ 125,470 *Other includes FreshCloud, technical services and sales-type leases related to Tecnidex. ——————————————————————————————— (1) North America includes the United States and Canada. (2) EMEA includes Europe, the Middle East, and Africa. (3) Latin America includes Argentina, Brazil, Chile, Costa Rica, Colombia, Dominican Republic, Ecuador, Guatemala, Mexico, Peru, and Uruguay. (4) Asia Pacific includes Australia, China, India, Japan, New Zealand, the Philippines, South Korea, Taiwan, and Thailand. |
Schedule of changes in contract assets and liabilities | The following table presents changes in the Company’s contract assets and liabilities during the nine months ended September 30, 2019 and the twelve months ended December 31, 2018: (in thousands) Balance at Additions Deductions Balance at, Contract assets: Unbilled revenue $ 1,956 $ 8,958 $ (6,911) $ 4,003 Contract liabilities: Deferred revenue $ 1,280 $ 2,810 $ (2,761) $ 1,329 (in thousands) Balance at Additions Deductions Balance at, Contract assets: Unbilled revenue $ 739 $ 7,117 $ (5,900) $ 1,956 Contract liabilities: Deferred revenue $ 100 $ 4,428 $ (3,248) $ 1,280 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of incurred expenses for services | The Company incurred expenses for such services for the nine months ended September 30, 2019 and September 30, 2018 as follows: (in thousands) Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Ongoing costs of transition services agreement $ 90 $ 251 Other expenses — 1,484 Total incurred expenses $ 90 $ 1,735 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Raw material $ 2,852 $ 1,286 Work-in-process 4,996 4,749 Finished goods 15,306 17,535 Supplies 1,045 1,237 Total inventories $ 24,199 $ 24,807 |
Other Current Assets (Tables)
Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of other current assets | The Company's other current assets at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, VAT receivable $ 6,531 $ 7,854 Prepaid income tax asset 4,813 5,090 Prepaid and other current assets 3,304 2,664 Total other current assets $ 14,648 $ 15,608 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands, except for useful life data) Useful life September 30, December 31, Buildings and leasehold improvements 7-20 $ 6,030 $ 4,647 Machinery & equipment 1-12 10,487 8,193 Furniture 1-12 2,656 2,712 Construction in progress 1,701 1,744 20,874 17,296 Less: accumulated depreciation (7,231) (4,007) Total property and equipment, net $ 13,643 $ 13,289 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in the carrying amount of goodwill | Changes in the carrying amount of goodwill for the nine months ended September 30, 2019 and the twelve months ended December 31, 2018 were as follows: (in thousands) September 30, December 31, Balance as of Beginning balance $ 6,670 $ 9,402 Measurement period adjustment — (2,807) Foreign currency translation (579) 75 Balance as of Ending balance $ 6,091 $ 6,670 |
Schedule of other intangible assets | The Company’s intangible assets at September 30, 2019 and December 31, 2018 consisted of the following: September 30, 2019 December 31, 2018 (in thousands) Gross Carrying Accumulated Impairment Net Gross Carrying Accumulated Impairment Net Other intangible assets: Developed technology $ 759,205 $ (165,730) $ — $ 593,475 $ 759,290 $ (134,151) $ — $ 625,139 In-process research and development 39,000 (6,681) — 32,319 39,000 (5,055) — 33,945 Trade name 27,216 — — 27,216 28,507 — (2,600) 25,907 Service provider network 2,000 — — 2,000 2,000 — — 2,000 Customer relationships 17,866 (1,958) — 15,908 19,872 (2,198) — 17,674 Software 10,604 (3,638) (992) 5,974 9,405 (2,161) — 7,244 Other 100 (54) — 46 100 (42) — 58 Total intangible assets $ 855,991 $ (178,061) $ (992) $ 676,938 $ 858,174 $ (143,607) $ (2,600) $ 711,967 |
Schedule of estimated annual amortization expense for finite-lived intangible assets | Estimated annual amortization expense for finite-lived intangible assets subsequent to September 30, 2019 is as follows: (in thousands) Amount 2019 (remaining) $ 10,893 2020 43,545 2021 43,295 2022 43,150 2023 43,142 Thereafter 463,697 Total $ 647,722 |
Accrued and Other Current Lia_2
Accrued and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued and other current liabilities | The Company’s accrued and other current liabilities at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Tax amortization benefit contingency $ 10,844 $ 11,098 Additional consideration due seller 451 379 Accrued compensation and benefits 9,136 10,192 Accrued rebates payable 4,302 3,616 Insurance premium financing payable 1,247 721 Severance 638 971 Deferred revenue 1,329 1,280 Accrued taxes 4,030 5,316 Accrued interest 5,086 — Lease liability 1,534 — Other 2,800 11,767 Total accrued and other current liabilities $ 41,397 $ 45,340 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of debt, net of unamortized discount and deferred financing fees | The Company’s debt, net of unamortized deferred issuance costs, at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Total Term Loan outstanding $ 406,937 $ 410,125 Unamortized deferred issuance costs (4,474) (6,168) Tecnidex loan outstanding 904 2,771 Less: Amounts due within one year 4,748 6,419 Total long-term debt due after one year $ 398,619 $ 400,309 |
Schedule of principal repayments under the term loan | Scheduled principal repayments of debt subsequent to September 30, 2019 are as follows: (in thousands) Amount 2019 (remaining) $ 1,213 2020 4,792 2021 401,836 Total $ 407,841 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Schedule of Additional Information of Operating Leases | Additional information regarding the Company's operating leases is as follows: (in thousands) Three Months Ended September 30, 2019 Nine Months Ended Operating Lease Cost Operating leases $ 591 $ 1,849 Short-term leases (1) 5 52 Total lease expense $ 596 $ 1,901 (1) Leases with an initial term of twelve months or less are not recorded on the balance sheet. Other information on operating leases Cash payments included in operating cash flows $ 1,625 Weighted average discount rate 9.33 % Weighted average remaining lease term in years 5.53 |
Schedule of Maturities of Lease Liabilities | The following table presents the contractual maturities of the Company's lease liabilities as of September 30, 2019: (in thousands) Lease Liability Remainder of 2019 $ 540 2020 1,905 2021 1,641 2022 1,487 2023 1,277 2024 and thereafter 2,364 Total undiscounted lease payments $ 9,214 Less: present value adjustment 2,075 Operating lease liability $ 7,139 |
Schedule of Future Minimum Lease Payments | The following table presents the future minimum lease payments as of December 31, 2018 under noncancellable operating leases: (in thousands) Future lease Payments 2019 $ 3,413 2020 2,058 2021 1,790 2022 1,640 2023 1,242 Thereafter 2,396 Total $ 12,539 |
Other Noncurrent Liabilities (T
Other Noncurrent Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Liabilities, Other than Long-term Debt, Noncurrent [Abstract] | |
Other noncurrent liabilities | The Company’s other noncurrent liabilities at September 30, 2019 and December 31, 2018 consisted of the following: (in thousands) September 30, December 31, Tax amortization benefit contingency $ 32,363 $ 29,369 Lease liability 5,605 — Other (1) 2,765 2,697 Total other noncurrent liabilities $ 40,733 $ 32,066 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of weighted average common shares outstanding | The following is a reconciliation of the weighted-average common shares outstanding used for the computation of basic and diluted net income (loss) per common share: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Basic weighted-average common shares outstanding 50,227,590 49,853,181 50,138,835 49,671,648 Effect of dilutive options, performance stock units and restricted stock 60,714 456,798 — — Diluted weighted-average shares outstanding 50,288,304 50,309,979 50,138,835 49,671,648 |
Amounts that could potentially dilute basic earnings per share | The following represent the number of shares that could potentially dilute basic earnings per share in the future: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Stock-based compensation awards (1) : Stock options 1,028,583 322,158 949,987 322,158 Restricted stock to non-directors 749,510 336,286 624,930 278,289 Restricted stock to directors — 84,427 — 72,655 Warrants: Private placement warrants 6,160,000 6,160,000 6,160,000 6,160,000 Public warrants 9,823,072 9,823,072 9,823,072 9,823,072 (1) SARs and Phantom Shares are payable in cash so will have no impact on number of shares |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of revenue by segment | The following table presents a breakdown of our revenues and gross profit based on reportable segments for the three and nine months ended September 30, 2019 and 2018. (in thousands) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended AgroFresh Core Revenues $ 45,917 $ 64,647 $ 96,272 $ 112,489 Gross Profit 34,182 51,149 72,679 87,861 Tecnidex Revenues 3,055 4,051 12,823 12,981 Gross Profit 898 887 4,900 4,699 Total Revenues $ 48,972 $ 68,698 $ 109,095 $ 125,470 Total Gross Profit $ 35,080 $ 52,036 $ 77,579 $ 92,560 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Tabular disclosure of financial instruments measured at fair value on a recurring basis | The following table presents the fair value of the Company’s financial instruments that are measured at fair value on a recurring basis as of September 30, 2019: (in thousands) Level 1 Level 2 Level 3 Total Tax amortization benefit contingency (1) $ — $ — $ 43,207 $ 43,207 Contingent consideration (2) — — 451 451 Liability-classified stock compensation (3) — — 218 218 Interest rate swap (4) $ — $ (106) $ — $ (106) Total $ — $ (106) $ 43,876 $ 43,770 The following table presents the fair value of the Company’s financial instruments that are measured at fair value on a recurring basis as of December 31, 2018: (in thousands) Level 1 Level 2 Level 3 Total Tax amortization benefit contingency (1) $ — $ — $ 40,467 $ 40,467 Contingent consideration (2) — — 379 379 Liability-classified stock compensation (3) — — 550 550 Total $ — $ — $ 41,396 $ 41,396 (1) The fair value of the tax amortization benefit contingency is measured using an income approach based on the Company’s best estimate of the undiscounted cash payments to be made, using an estimated tax rate of 21.5% and discounted to present value utilizing an appropriate market discount rate. (2) The fair value of the contingent consideration related to the Tecnidex acquisition. (3) The fair value of the stock appreciation rights was measured using a Black Scholes pricing model during the nine months ended September 30, 2019. The fair value of time based phantom shares is based on the fair value of the Company's common stock. The fair value of performance based phantom shares was measured using a Monte Carlo pricing model during the nine months ended September 30, 2019. The valuation technique used did not change during the nine months ended September 30, 2019. |
Changes in financial instruments measured at level 3 fair value on a recurring basis | The following table presents the changes during the period presented in our Level 3 financial instrument liabilities that are measured at fair value on a recurring basis. (in thousands) Tax amortization benefit contingency Contingent consideration related to acquisition Liability-classified stock compensation Interest rate swap Total Balance, December 31, 2018 $ 40,467 $ 379 $ 550 $ — $ 41,396 Accretion 2,669 — — — 2,669 Tecnidex earnout activity — 72 — — 72 Stock compensation activity — — (332) — (332) Mark-to-market adjustment 71 — — (106) (35) Balance, September 30, 2019 $ 43,207 $ 451 $ 218 $ (106) $ 43,770 |
Description of Business (Detail
Description of Business (Details) storage_room in Thousands | 9 Months Ended |
Sep. 30, 2019storage_roomcountrycustomer | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating countries (over) | country | 50 |
Number of customers | customer | 3,900 |
Number of service locations (more than) | storage_room | 25 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Jan. 01, 2019 | |
Concentration Risk [Line Items] | |||
Lease liability | $ 7,139 | ||
ARGENTINA | Subsidiaries | |||
Concentration Risk [Line Items] | |||
Net assets | $ 6,700 | ||
Sales Revenue, Net | Geographic Concentration Risk | ARGENTINA | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 6.00% | 5.00% | |
Accounting Standards Update 2016-02 | |||
Concentration Risk [Line Items] | |||
Right-of-use asset | $ 7,300 | ||
Lease liability | $ 7,300 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | $ 48,972 | $ 68,698 | $ 109,095 | $ 125,470 |
North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 19,944 | 26,913 | 24,038 | 29,884 |
EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 25,320 | 38,465 | 44,257 | 56,838 |
Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 1,986 | 933 | 29,342 | 26,520 |
Asia Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 1,722 | 2,387 | 11,458 | 12,228 |
Products transferred at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 48,522 | 68,199 | 107,222 | 124,591 |
Products transferred at a point in time | North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 19,802 | 26,774 | 23,380 | 29,701 |
Products transferred at a point in time | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 25,238 | 38,342 | 43,374 | 56,658 |
Products transferred at a point in time | Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 1,877 | 907 | 29,159 | 26,448 |
Products transferred at a point in time | Asia Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 1,605 | 2,176 | 11,309 | 11,784 |
Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 450 | 499 | 1,873 | 879 |
Services transferred over time | North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 142 | 139 | 658 | 183 |
Services transferred over time | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 82 | 123 | 883 | 180 |
Services transferred over time | Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 109 | 26 | 183 | 72 |
Services transferred over time | Asia Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 117 | 211 | 149 | 444 |
1-MCP based | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 45,388 | 63,479 | 93,839 | 110,299 |
1-MCP based | North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 19,726 | 26,029 | 23,084 | 28,378 |
1-MCP based | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 22,377 | 34,284 | 31,965 | 43,508 |
1-MCP based | Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 1,680 | 779 | 27,503 | 26,185 |
1-MCP based | Asia Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 1,605 | 2,387 | 11,287 | 12,228 |
Fungicides, waxes, coatings, sanitizers | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 3,055 | 4,317 | 12,823 | 13,251 |
Fungicides, waxes, coatings, sanitizers | North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 0 | 270 | 0 | 270 |
Fungicides, waxes, coatings, sanitizers | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 2,857 | 4,047 | 11,365 | 12,981 |
Fungicides, waxes, coatings, sanitizers | Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 198 | 0 | 1,458 | 0 |
Fungicides, waxes, coatings, sanitizers | Asia Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 0 | 0 | 0 | 0 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 529 | 902 | 2,433 | 1,920 |
Other | North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 218 | 614 | 954 | 1,236 |
Other | EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 86 | 134 | 927 | 349 |
Other | Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 108 | 154 | 381 | 335 |
Other | Asia Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | $ 117 | $ 0 | $ 171 | $ 0 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Contract assets: | ||
Beginning balance | $ 1,956 | $ 739 |
Additions | 8,958 | 7,117 |
Deductions | (6,911) | |
Ending balance | 4,003 | 1,956 |
Contract liabilities: | ||
Beginning balance | 1,280 | 100 |
Additions | 2,810 | 4,428 |
Deductions | (2,761) | (3,248) |
Ending balance | 1,329 | 1,280 |
Amounts reclassified from unbilled revenue to accounts receivable | 6,900 | 5,900 |
Amounts reclassified from deferred revenue to revenue | $ 2,800 | $ 3,200 |
Business Combinations and Ass_2
Business Combinations and Asset Acquisition (Details) $ in Thousands | Apr. 09, 2018USD ($) | Jan. 31, 2018USD ($) | Dec. 01, 2017USD ($) | Apr. 04, 2017USD ($) | Jul. 31, 2015USD ($)shares | Dec. 31, 2018USD ($) | Sep. 30, 2019country | Nov. 07, 2017country |
Class of Warrant or Right [Line Items] | ||||||||
Number of operating countries | country | 50 | |||||||
Verigo | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Payments to acquire software | $ 1,800 | |||||||
Tax receivables agreement (TRA) | Dow | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Rate of tax receivable agreement | 50.00% | |||||||
Amendment agreement | Dow | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Increase (decrease) in liabilities | $ 20,000 | |||||||
Cash paid to related party | $ 10,000 | $ 10,000 | ||||||
AgroFresh Inc. | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Cash consideration | $ 635,000 | |||||||
Tecnidex Fruit Protection, S.A.U. | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Cash consideration | $ 20,000 | $ 2,300 | ||||||
Purchase price | $ 25,000 | 22,300 | ||||||
Percentage of voting interests acquired | 75.00% | |||||||
Common Stock | AgroFresh Inc. | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of shares issued as consideration (in shares) | shares | 17,500,000 | |||||||
Level 3 | Tecnidex Fruit Protection, S.A.U. | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Contingent consideration | $ 700 | |||||||
Adjustment to purchase price allocation | $ 2,800 | |||||||
Tecnidex Fruit Protection, S.A.U. | Tecnidex Fruit Protection, S.A.U. | ||||||||
Class of Warrant or Right [Line Items] | ||||||||
Number of operating countries | country | 18 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Nov. 29, 2016 | |
Dow | |||
Related party transactions | |||
Outstanding payable to related party | $ 100,000 | $ 500,000 | |
Amounts owed to related parties for consulting services | (100,000) | (500,000) | |
Director | Mutal services agreement | |||
Related party transactions | |||
Outstanding payable to related party | 0 | ||
Consulting fee, daily | $ 5,000 | ||
Expenses paid per service agreement | 0 | 0 | |
Amounts owed to related parties for consulting services | 0 | ||
Dow | Seperate IT Services | |||
Related party transactions | |||
Payment amount for services | 5,000,000 | ||
Dow | Dow | |||
Related party transactions | |||
Payment amount for services | 90,000 | 1,735,000 | |
Dow | Dow | Ongoing costs of transition services agreement | |||
Related party transactions | |||
Payment amount for services | 90,000 | 251,000 | |
Dow | Dow | Other expenses | |||
Related party transactions | |||
Payment amount for services | $ 0 | $ 1,484,000 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw material | $ 2,852 | $ 1,286 |
Work-in-process | 4,996 | 4,749 |
Finished goods | 15,306 | 17,535 |
Supplies | 1,045 | 1,237 |
Total inventories | $ 24,199 | $ 24,807 |
Other Current Assets (Details)
Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
VAT receivable | $ 6,531 | $ 7,854 |
Prepaid income tax asset | 4,813 | 5,090 |
Prepaid and other current assets | 3,304 | 2,664 |
Total other current assets | $ 14,648 | $ 15,608 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 20,874 | $ 20,874 | $ 17,296 | ||
Less: accumulated depreciation | (7,231) | (7,231) | (4,007) | ||
Total property and equipment, net | 13,643 | 13,643 | 13,289 | ||
Depreciation expense | 600 | $ 400 | 1,600 | $ 1,200 | |
Buildings and lease hold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 6,030 | $ 6,030 | 4,647 | ||
Buildings and lease hold improvements | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 7 years | ||||
Buildings and lease hold improvements | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 20 years | ||||
Machinery & equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 10,487 | $ 10,487 | 8,193 | ||
Machinery & equipment | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 1 year | ||||
Machinery & equipment | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 12 years | ||||
Furniture | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 2,656 | $ 2,656 | 2,712 | ||
Furniture | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 1 year | ||||
Furniture | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 12 years | ||||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 1,701 | $ 1,701 | $ 1,744 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 6,670 | $ 9,402 |
Measurement period adjustment | 0 | (2,807) |
Foreign currency translation | (579) | $ 75 |
Ending balance | $ 6,091 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Other intangible assets: | ||
Total intangible assets | $ 855,991 | $ 858,174 |
Accumulated Amortization | (178,061) | (143,607) |
Impairment | (992) | (2,600) |
Net, finite-lived intangible assets | 647,722 | |
Total intangible assets, net | $ 676,938 | 711,967 |
Weighted average | ||
Other intangible assets: | ||
Useful life | 15 years 4 months 24 days | |
Trade name | ||
Other intangible assets: | ||
Gross carrying amount, indefinite-lived | $ 27,216 | 28,507 |
Impairment | (2,600) | |
Net, indefinite-lived intangible assets | 27,216 | 25,907 |
Impairment charge | 2,600 | |
Service provider network | ||
Other intangible assets: | ||
Gross carrying amount, indefinite-lived | 2,000 | 2,000 |
Net, indefinite-lived intangible assets | 2,000 | 2,000 |
Developed technology | ||
Other intangible assets: | ||
Gross carrying amount, finite-lived | 759,205 | 759,290 |
Accumulated Amortization | (165,730) | (134,151) |
Net, finite-lived intangible assets | $ 593,475 | 625,139 |
Developed technology | Weighted average | ||
Other intangible assets: | ||
Useful life | 15 years 7 months 6 days | |
In-process research and development | ||
Other intangible assets: | ||
Gross carrying amount, finite-lived | $ 39,000 | 39,000 |
Accumulated Amortization | (6,681) | (5,055) |
Net, finite-lived intangible assets | $ 32,319 | 33,945 |
In-process research and development | Weighted average | ||
Other intangible assets: | ||
Useful life | 15 years | |
Customer relationships | ||
Other intangible assets: | ||
Gross carrying amount, finite-lived | $ 17,866 | 19,872 |
Accumulated Amortization | (1,958) | (2,198) |
Net, finite-lived intangible assets | $ 15,908 | 17,674 |
Customer relationships | Weighted average | ||
Other intangible assets: | ||
Useful life | 13 years | |
Software | ||
Other intangible assets: | ||
Gross carrying amount, finite-lived | $ 10,604 | 9,405 |
Accumulated Amortization | (3,638) | (2,161) |
Impairment | (992) | |
Net, finite-lived intangible assets | $ 5,974 | 7,244 |
Software | Weighted average | ||
Other intangible assets: | ||
Useful life | 3 years | |
Other | ||
Other intangible assets: | ||
Gross carrying amount, finite-lived | $ 100 | 100 |
Accumulated Amortization | (54) | (42) |
Net, finite-lived intangible assets | $ 46 | $ 58 |
Other | Weighted average | ||
Other intangible assets: | ||
Useful life | 2 years 9 months 18 days |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Future Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Estimated annual amortization expense | ||||
2019 (remaining) | $ 10,893 | $ 10,893 | ||
2020 | 43,545 | 43,545 | ||
2021 | 43,295 | 43,295 | ||
2022 | 43,150 | 43,150 | ||
2023 | 43,142 | 43,142 | ||
Thereafter | 463,697 | 463,697 | ||
Net, finite-lived intangible assets | 647,722 | 647,722 | ||
Amortization of intangibles | $ 11,754 | $ 12,002 | $ 35,136 | $ 34,342 |
Accrued and Other Current Lia_3
Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Tax amortization benefit contingency | $ 10,844 | $ 11,098 |
Additional consideration due seller | 451 | 379 |
Accrued compensation and benefits | 9,136 | 10,192 |
Accrued rebates payable | 4,302 | 3,616 |
Insurance premium financing payable | 1,247 | 721 |
Severance | 638 | 971 |
Deferred revenue | 1,329 | 1,280 |
Accrued taxes | 4,030 | 5,316 |
Accrued interest | 5,086 | 0 |
Lease liability | 1,534 | 0 |
Other | 2,800 | 11,767 |
Total accrued and other current liabilities | $ 41,397 | $ 45,340 |
Debt - Net of Unamortized Disco
Debt - Net of Unamortized Discounts and Deferred Financing Fees (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Less: Amounts due within one year | $ 4,748 | $ 6,419 |
Long-term debt | 398,619 | 400,309 |
Loans Payable | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Total | 904 | 2,771 |
Term loan | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Total | 406,937 | 410,125 |
Unamortized deferred issuance costs | $ (4,474) | $ (6,168) |
Debt (Details)
Debt (Details) - USD ($) | Jul. 31, 2015 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Jan. 31, 2019 | Dec. 31, 2018 |
Credit facility | |||||||
Long term debt, gross | $ 407,841,000 | $ 407,841,000 | |||||
Amortization of deferred financing costs | $ 2,032,000 | $ 1,842,000 | |||||
Excess cash flows, repayment of debt, percentage | 50.00% | ||||||
Excess cash flows threshold for dividends | $ 5,000,000 | ||||||
Term loan | |||||||
Credit facility | |||||||
Fair value of debt | 376,400,000 | 376,400,000 | |||||
Debt issuance costs incurred | $ 12,900,000 | 12,900,000 | 12,900,000 | ||||
Deferred issuance costs, net | 4,474,000 | 4,474,000 | $ 6,168,000 | ||||
Face amount | $ 425,000,000 | ||||||
Amortization per year (as a percent) | 1.00% | ||||||
Long term debt, gross | 406,900,000 | 406,900,000 | |||||
Amortization of deferred financing costs | 600,000 | $ 600,000 | 1,700,000 | $ 1,800,000 | |||
Term loan | Prepayment due to Excess Cash Flow provision | |||||||
Credit facility | |||||||
Repayments of principal in next 12 months | 0 | 0 | |||||
Revolving loan | |||||||
Credit facility | |||||||
Debt issuance costs incurred | $ 1,300,000 | ||||||
Maximum borrowing available | $ 25,000,000 | $ 12,500,000 | |||||
Long term debt, gross | $ 0 | $ 0 | |||||
Letter-of-credit sub-facility | |||||||
Credit facility | |||||||
Maximum borrowing available | $ 10,000,000 | ||||||
Credit Facility | Alternate base rate | |||||||
Credit facility | |||||||
Margin of interest (as a percent) | 3.75% | ||||||
Credit Facility | LIBOR | |||||||
Credit facility | |||||||
Margin of interest (as a percent) | 4.75% | ||||||
Variable rate base minimum (as a percent) | 1.00% |
Debt - Principal Repayments (De
Debt - Principal Repayments (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Schedule of principal repayments under the Term Loan | |
2019 (remaining) | $ 1,213 |
2020 | 4,792 |
2021 | 401,836 |
Total | $ 407,841 |
Leases - Additional Information
Leases - Additional Information on Operating Leases (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | |
Operating Lease Cost | ||
Operating leases | $ 591 | $ 1,849 |
Short-term lease | 5 | 52 |
Total lease expense | $ 596 | 1,901 |
Cash payments included in operating cash flows | $ 1,625 | |
Weighted average discount rate | 9.33% | 9.33% |
Weighted average remaining lease term in years | 5 years 6 months 10 days | 5 years 6 months 10 days |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
Remainder of 2019 | $ 540 |
2020 | 1,905 |
2021 | 1,641 |
2022 | 1,487 |
2023 | 1,277 |
2024 and thereafter | 2,364 |
Total undiscounted lease payments | 9,214 |
Less: present value adjustment | 2,075 |
Operating lease liability | $ 7,139 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 3,413 |
2020 | 2,058 |
2021 | 1,790 |
2022 | 1,640 |
2023 | 1,242 |
Thereafter | 2,396 |
Total | $ 12,539 |
Other Noncurrent Liabilities (D
Other Noncurrent Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Liabilities, Other than Long-term Debt, Noncurrent [Abstract] | ||
Tax amortization benefit contingency | $ 32,363 | $ 29,369 |
Lease liability | 5,605 | 0 |
Other | 2,765 | 2,697 |
Total other noncurrent liabilities | $ 40,733 | $ 32,066 |
Severance (Details)
Severance (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Compensation Related Costs [Abstract] | |||||
Severance expense | $ 0.3 | $ 1.7 | $ 1 | $ 2.1 | |
Severance liability, current | $ 0.6 | $ 0.6 | $ 1 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | Jul. 31, 2015directorshares | Sep. 30, 2019vote$ / sharesshares | Dec. 31, 2015shares | Dec. 31, 2018$ / sharesshares | Feb. 28, 2014shares |
Class of Warrant or Right [Line Items] | |||||
Authorized common stock (in shares) | 400,000,000 | 400,000,000 | |||
Par value of common stock (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||
Number of votes entitled by holders of common stock for each share of common stock | vote | 1 | ||||
Common stock, shares outstanding (in shares) | 50,931,578 | 50,410,192 | |||
Number of shares issuable upon exercise of warrants (in shares) | 15,983,072 | ||||
Exercise price (in dollars per share) | $ / shares | $ 11.50 | ||||
Number of warrants outstanding (in shares) | 15,983,072 | ||||
Rohm and Haas | |||||
Class of Warrant or Right [Line Items] | |||||
Number of shares of Series A Preferred Stock issued as condition to consummation of business combination (in shares) | 1 | ||||
Number of directors preferred stockholder is entitled to appoint if minimum ownership percentage of common stock is maintained | director | 1 | ||||
Minimum percentage of outstanding shares of voting and non-voting common stock to be held to entitle preferred stockholder to appoint director | 10.00% | ||||
Public | |||||
Class of Warrant or Right [Line Items] | |||||
Number of warrants outstanding (in shares) | 9,823,072 | ||||
Number of warrants repurchased (in shares) | 1,201,928 | ||||
Private placement | |||||
Class of Warrant or Right [Line Items] | |||||
Number of warrants outstanding (in shares) | 6,160,000 |
Stock-based Compensation (Detai
Stock-based Compensation (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2019 | Jul. 31, 2015 | |
Share-based Payment Arrangement [Abstract] | ||||||
Shares authorized (in shares) | 500,000 | 7,150,000 | ||||
Stock-based compensation expense | $ 1 | $ 0.2 | $ 2.1 | $ 2 | ||
Share-based compensation, nonvested awards, compensation cost not yet recognized | $ 4.4 | $ 4.4 | ||||
Period for recognition of compensation on unvested stock option | 1 year 9 months 18 days |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Weighted Average Common Shares Outstanding (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Basic weighted-average common shares outstanding (in shares) | 50,227,590 | 49,853,181 | 50,138,835 | 49,671,648 |
Effect of dilutive options, performance stock units and restricted stock (in shares) | 60,714 | 456,798 | 0 | 0 |
Dilute weighted-average shares outstanding (in shares) | 50,288,304 | 50,309,979 | 50,138,835 | 49,671,648 |
Earnings Per Share (Details)
Earnings Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Stock options | ||||
Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 1,028,583 | 322,158 | 949,987 | 322,158 |
Restricted stock to non-directors | ||||
Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 749,510 | 336,286 | 624,930 | 278,289 |
Warrants | Private placement | ||||
Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 6,160,000 | 6,160,000 | 6,160,000 | 6,160,000 |
Warrants | Public | ||||
Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 9,823,072 | 9,823,072 | 9,823,072 | 9,823,072 |
Director | Restricted stock to directors | ||||
Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 0 | 84,427 | 0 | 72,655 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate (as a percent) | 214.00% | 25.60% | 28.20% | (0.80%) |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)segment | Sep. 30, 2018USD ($) | |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | ||||
Number of operating segments | segment | 2 | |||
Number of reportable segments | segment | 2 | |||
Revenues | $ 48,972 | $ 68,698 | $ 109,095 | $ 125,470 |
Gross Profit | 35,080 | 52,036 | 77,579 | 92,560 |
AgroFresh Core | ||||
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | ||||
Revenues | 45,917 | 64,647 | 96,272 | 112,489 |
Gross Profit | 34,182 | 51,149 | 72,679 | 87,861 |
Tecnidex | ||||
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | ||||
Revenues | 3,055 | 4,051 | 12,823 | |
Gross Profit | $ 898 | $ 887 | $ 4,900 | $ 4,699 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) $ in Millions | Oct. 14, 2019USD ($) |
Unfavorable Regulatory Action | Subsequent Event | |
Loss Contingencies [Line Items] | |
Damages awarded | $ 31.1 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Instruments Measured on a Recurring Basis (Details) - Recurring - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Financial instruments measured at fair value on a recurring basis | ||
Level 1 to level 2 transfers | $ 0 | |
Transfers | 0 | |
Contingent consideration | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 43,770,000 | $ 41,396,000 |
Contingent consideration | Tax amortization benefit contingency | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 43,207,000 | 40,467,000 |
Contingent consideration | Contingent consideration related to acquisition | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 451,000 | 379,000 |
Contingent consideration | Liability-classified stock compensation | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 218,000 | 550,000 |
Contingent consideration | Level 1 | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | 0 |
Contingent consideration | Level 1 | Tax amortization benefit contingency | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | 0 |
Contingent consideration | Level 1 | Contingent consideration related to acquisition | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | 0 |
Contingent consideration | Level 1 | Liability-classified stock compensation | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | 0 |
Contingent consideration | Level 2 | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | (106,000) | 0 |
Contingent consideration | Level 2 | Tax amortization benefit contingency | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | 0 |
Contingent consideration | Level 2 | Contingent consideration related to acquisition | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | 0 |
Contingent consideration | Level 2 | Liability-classified stock compensation | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | 0 |
Contingent consideration | Level 3 | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 43,876,000 | 41,396,000 |
Contingent consideration | Level 3 | Tax amortization benefit contingency | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | $ 43,207,000 | 40,467,000 |
Tax effect rate | 21.50% | |
Contingent consideration | Level 3 | Contingent consideration related to acquisition | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | $ 451,000 | 379,000 |
Contingent consideration | Level 3 | Liability-classified stock compensation | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 218,000 | $ 550,000 |
Derivative financial instruments, liabilities | Interest rate swap | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | (106,000) | |
Derivative financial instruments, liabilities | Level 1 | Interest rate swap | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 0 | |
Derivative financial instruments, liabilities | Level 2 | Interest rate swap | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | 106,000 | |
Derivative financial instruments, liabilities | Level 3 | Interest rate swap | ||
Financial instruments measured at fair value on a recurring basis | ||
Fair value of liability | $ 0 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes of Level 3 Financial Instruments (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Contingent consideration | Tax amortization benefit contingency | |
Financial instruments measured at Level 3 fair value on a recurring basis rollforward | |
Balance, beginning period | $ 40,467 |
Accretion | 2,669 |
Tecnidex earnout activity | 0 |
Stock compensation activity | 0 |
Balance, ending period | 43,207 |
Contingent consideration | Contingent consideration related to acquisition | |
Financial instruments measured at Level 3 fair value on a recurring basis rollforward | |
Balance, beginning period | 379 |
Accretion | 0 |
Tecnidex earnout activity | 72 |
Stock compensation activity | 0 |
Balance, ending period | 451 |
Contingent consideration | Liability-classified stock compensation | |
Financial instruments measured at Level 3 fair value on a recurring basis rollforward | |
Balance, beginning period | 550 |
Accretion | 0 |
Tecnidex earnout activity | 0 |
Stock compensation activity | (332) |
Balance, ending period | 218 |
Contingent consideration | Total | |
Financial instruments measured at Level 3 fair value on a recurring basis rollforward | |
Balance, beginning period | 41,396 |
Accretion | 2,669 |
Tecnidex earnout activity | 72 |
Stock compensation activity | (332) |
Balance, ending period | 43,770 |
Derivative financial instruments, liabilities | |
Financial instruments measured at Level 3 fair value on a recurring basis rollforward | |
Mark-to-market adjustment | (35) |
Derivative financial instruments, liabilities | Interest rate swap | |
Financial instruments measured at Level 3 fair value on a recurring basis rollforward | |
Mark-to-market adjustment | (106) |
Term loan | |
Financial instruments measured at Level 3 fair value on a recurring basis | |
Fair value of debt | $ 376,400 |
Uncategorized Items - agfs-2019
Label | Element | Value |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | $ 527,000 |
Restricted Cash and Cash Equivalents, Current | us-gaap_RestrictedCashAndCashEquivalentsAtCarryingValue | $ 0 |