Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 02, 2020 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2020 | |
Entity File Number | 001-38604 | |
Entity Registrant Name | Focus Financial Partners Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-4780811 | |
Entity Address, Address Line One | 875 Third Avenue, 28th Floor | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10022 | |
City Area Code | 646 | |
Local Phone Number | 519-2456 | |
Title of 12(b) Security | Class A common stock, par value$0.01 per share | |
Trading Symbol | FOCS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001651052 | |
Amendment Flag | false | |
Class A common stock | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 50,610,589 | |
Class B common stock | ||
Document and Entity Information | ||
Entity Common Stock, Shares Outstanding | 20,895,381 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents | $ 42,655 | $ 65,178 |
Accounts receivable less allowances of $684 at 2019 and $1,375 at 2020 | 157,071 | 129,337 |
Prepaid expenses and other assets | 62,987 | 58,581 |
Fixed assets-net | 45,322 | 41,634 |
Operating lease assets | 236,822 | 180,114 |
Debt financing costs-net | 7,623 | 9,645 |
Deferred tax assets-net | 103,456 | 75,453 |
Goodwill | 1,125,604 | 1,090,231 |
Other intangible assets-net | 947,727 | 1,003,456 |
TOTAL ASSETS | 2,729,267 | 2,653,629 |
LIABILITIES | ||
Accounts payable | 8,563 | 8,077 |
Accrued expenses | 61,580 | 41,442 |
Due to affiliates | 46,753 | 58,600 |
Deferred revenue | 10,958 | 7,839 |
Other liabilities | 167,725 | 215,878 |
Operating lease liabilities | 256,903 | 196,425 |
Borrowings under credit facilities (stated value of $1,279,188 and $1,260,514 at December 31, 2019 and September 30, 2020, respectively) | 1,259,975 | 1,272,999 |
Tax receivable agreements obligations | 78,124 | 48,399 |
TOTAL LIABILITIES | 1,890,581 | 1,849,659 |
COMMITMENTS AND CONTINGENCIES (Note 12) | ||
EQUITY | ||
Additional paid-in capital | 536,619 | 498,186 |
Retained earnings (deficit) | 10,985 | (13,462) |
Accumulated other comprehensive loss | (7,311) | (1,299) |
Total shareholders' equity | 541,008 | 484,120 |
Non-controlling interest | 297,678 | 319,850 |
Total equity | 838,686 | 803,970 |
TOTAL LIABILITIES AND EQUITY | 2,729,267 | 2,653,629 |
Class A common stock | ||
EQUITY | ||
Common stock | 506 | 474 |
Class B common stock | ||
EQUITY | ||
Common stock | $ 209 | $ 221 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts receivable, allowances | $ 1,375 | $ 684 |
Borrowings under credit facilities, stated value | $ 1,260,514 | $ 1,279,188 |
Class A common stock | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 500,000,000 | 500,000,000 |
Common stock, issued shares | 50,594,372 | 47,421,315 |
Common stock, outstanding shares | 50,594,372 | 47,421,315 |
Class B common stock | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 500,000,000 | 500,000,000 |
Common stock, issued shares | 20,895,381 | 22,075,749 |
Common stock, outstanding shares | 20,895,381 | 22,075,749 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
REVENUES: | ||||
Total revenues | $ 331,483 | $ 316,641 | $ 981,646 | $ 878,110 |
OPERATING EXPENSES: | ||||
Compensation and related expenses | 114,702 | 111,829 | 346,460 | 318,808 |
Management fees | 86,414 | 81,112 | 247,094 | 217,370 |
Selling, general and administrative | 57,437 | 58,665 | 172,784 | 170,658 |
Management contract buyout | 1,428 | |||
Intangible amortization | 37,024 | 34,898 | 108,759 | 94,860 |
Non-cash changes in fair value of estimated contingent consideration | 14,280 | 14,435 | (621) | 25,696 |
Depreciation and other amortization | 3,120 | 2,797 | 9,131 | 7,535 |
Total operating expenses | 312,977 | 303,736 | 883,607 | 836,355 |
INCOME FROM OPERATIONS | 18,506 | 12,905 | 98,039 | 41,755 |
OTHER INCOME (EXPENSE): | ||||
Interest income | 61 | 291 | 412 | 827 |
Interest expense | (8,903) | (15,852) | (32,546) | (43,135) |
Amortization of debt financing costs | (709) | (919) | (2,200) | (2,483) |
Loss on extinguishment of borrowings | (6,094) | |||
Other income (expense)-net | (657) | 9 | 25 | (695) |
Income from equity method investments | 51 | 53 | 167 | 696 |
Total other expense-net | (10,157) | (16,418) | (40,236) | (44,790) |
Other income (expense)-net | 8,349 | (3,513) | 57,803 | (3,035) |
INCOME TAX EXPENSE (BENEFIT) | 4,405 | (3,905) | 16,512 | (3,701) |
NET INCOME | 3,944 | 392 | 41,291 | 666 |
Non-controlling interest | (2,302) | 881 | (16,844) | (1,539) |
NET INCOME (LOSS ) ATTRIBUTABLE TO COMMON SHAREHOLDERS | 1,642 | 1,273 | 24,447 | (873) |
Wealth management fees | ||||
REVENUES: | ||||
Total revenues | 311,805 | 299,348 | 925,527 | 825,728 |
Other | ||||
REVENUES: | ||||
Total revenues | $ 19,678 | $ 17,293 | $ 56,119 | $ 52,382 |
Class A common stock | ||||
Income (loss) per share of Class A common stock: | ||||
Basic income (loss) per share | $ 0.03 | $ 0.03 | $ 0.51 | $ (0.02) |
Diluted income (loss) per share | $ 0.03 | $ 0.03 | $ 0.51 | $ (0.02) |
Weighted average shares of Class A common stock outstanding: | ||||
Weighted average shares of Class A common stock outstanding | 48,683,580 | 47,044,507 | 47,991,831 | 46,653,820 |
Weighted average shares of Class A common stock outstanding | 48,810,328 | 47,058,613 | 48,040,014 | 46,653,820 |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) | ||||
Net income (loss) | $ 3,944 | $ 392 | $ 41,291 | $ 666 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | 3,103 | (2,464) | 316 | (2,797) |
Unrealized loss on interest rate swap designated as a cash flow hedge | (981) | (9,308) | ||
Comprehensive income (loss) | 6,066 | (2,072) | 32,299 | (2,131) |
Less: Comprehensive (income) loss attributable to noncontrolling interest | (3,219) | 1,769 | (13,864) | (494) |
Comprehensive income (loss) attributable to common shareholders | $ 2,847 | $ (303) | $ 18,435 | $ (2,625) |
Unaudited Condensed Consolida_5
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ 41,291 | $ 666 |
Adjustments to reconcile net income to net cash provided by operating activities-net of effect of acquisitions: | ||
Intangible amortization | 108,759 | 94,860 |
Depreciation and other amortization | 9,131 | 7,535 |
Amortization of debt financing costs | 2,200 | 2,483 |
Non-cash equity compensation expense | 15,588 | 13,375 |
Non-cash changes in fair value of estimated contingent consideration | (621) | 25,696 |
Income from equity method investments | (167) | (696) |
Distributions received from equity method investments | 145 | 668 |
Deferred taxes and other non-cash items | 4,148 | 117 |
Loss on extinguishment of borrowings | 6,094 | |
Changes in cash resulting from changes in operating assets and liabilities: | ||
Accounts receivable | (25,716) | (30,367) |
Prepaid expenses and other assets | (4,168) | (4,820) |
Accounts payable | 110 | 1,240 |
Accrued expenses | 20,294 | 39,968 |
Due to affiliates | (11,749) | 365 |
Other liabilities | (28,761) | (21,964) |
Deferred revenue | 1,889 | 794 |
Net cash provided by operating activities | 138,467 | 129,920 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Cash paid for acquisitions and contingent consideration-net of cash acquired | (69,467) | (494,336) |
Purchase of fixed assets | (12,691) | (20,758) |
Net cash used in investing activities | (82,158) | (515,094) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Borrowings under credit facilities | 305,000 | 939,125 |
Repayments of borrowings under credit facilities | (323,674) | (496,906) |
Contingent consideration paid | (45,069) | (20,514) |
Payments of debt financing costs | (634) | (3,743) |
Proceeds from exercise of stock options | 1,559 | 796 |
Payments on finance lease obligations | (109) | (138) |
Distributions for unitholders | (15,765) | (15,225) |
Net cash provided by (used ins) financing activities | (78,692) | 403,395 |
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS | (140) | (171) |
CHANGE IN CASH AND CASH EQUIVALENTS | (22,523) | 18,050 |
CASH AND CASH EQUIVALENTS: | ||
Beginning of period | 65,178 | 33,213 |
End of period | $ 42,655 | $ 51,263 |
Unaudited Condensed Consolida_6
Unaudited Condensed Consolidated Statements of Changes in Members' Deficit/Shareholders' Equity - USD ($) $ in Thousands | Total Shareholders' Equity | Common StockClass A common stock | Common StockClass B common stock | Additional Paid-In Capital | Retained Earnings (Deficit) | Accumulated Other Comprehensive Loss | Non-controlling Interest | Total |
Beginning balance at Dec. 31, 2018 | $ 469,662 | $ 462 | $ 228 | $ 471,386 | $ (590) | $ (1,824) | $ 342,858 | $ 812,520 |
Beginning balance (in shares) at Dec. 31, 2018 | 46,265,903 | 22,823,272 | ||||||
Increase (Decrease) in shareholders' equity | ||||||||
Net income (loss) | (873) | (873) | 1,539 | 666 | ||||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights (in shares) | 624,607 | (624,607) | ||||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights | 10,813 | $ 3 | 10,810 | 10,813 | ||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights (in shares) | 353,771 | |||||||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights | 18,824 | $ 7 | $ (6) | 18,823 | 18,824 | |||
Forfeiture of unvested Class A common stock | (412) | (412) | (412) | |||||
Forfeiture of unvested Class A common stock (in shares) | (12,500) | |||||||
Exercise of stock options | 796 | 796 | 796 | |||||
Exercise of stock options (in shares) | 24,126 | |||||||
Change in non-controlling interest allocation | (1,769) | (1,769) | (27,774) | (29,543) | ||||
Non-cash equity compensation expense | 2,556 | 2,556 | 2,556 | |||||
Currency translation adjustment - net of tax | (1,752) | (1,752) | (1,045) | (2,797) | ||||
Adjustment of deferred tax assets, net of amounts payable under tax receivable agreements and changes from Focus LLC interest transactions | 151 | 151 | 151 | |||||
Ending balance at Sep. 30, 2019 | 497,996 | $ 472 | $ 222 | 502,341 | (1,463) | (3,576) | 315,578 | 813,574 |
Ending Balance (in shares) at Sep. 30, 2019 | 47,255,907 | 22,198,665 | ||||||
Beginning balance at Jun. 30, 2019 | 485,524 | $ 471 | $ 223 | 489,566 | (2,736) | (2,000) | 330,331 | 815,855 |
Beginning balance (in shares) at Jun. 30, 2019 | 47,116,817 | 22,308,446 | ||||||
Increase (Decrease) in shareholders' equity | ||||||||
Net income (loss) | 1,273 | 1,273 | (881) | 392 | ||||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights | 2,252 | $ 1 | $ (1) | 2,252 | 2,252 | |||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights (in shares) | 109,781 | (109,781) | ||||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights | 838 | 838 | 838 | |||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights (in shares) | 40,900 | |||||||
Forfeiture of unvested Class A common stock | (382) | (382) | (382) | |||||
Forfeiture of unvested Class A common stock (in shares) | (11,591) | |||||||
Change in non-controlling interest allocation | 9,263 | 9,263 | (12,984) | (3,721) | ||||
Non-cash equity compensation expense | 903 | 903 | 903 | |||||
Currency translation adjustment - net of tax | (1,576) | (1,576) | (888) | (2,464) | ||||
Adjustment of deferred tax assets, net of amounts payable under tax receivable agreements and changes from Focus LLC interest transactions | (99) | (99) | (99) | |||||
Ending balance at Sep. 30, 2019 | 497,996 | $ 472 | $ 222 | 502,341 | (1,463) | (3,576) | 315,578 | 813,574 |
Ending Balance (in shares) at Sep. 30, 2019 | 47,255,907 | 22,198,665 | ||||||
Beginning balance at Dec. 31, 2019 | 484,120 | $ 474 | $ 221 | 498,186 | (13,462) | (1,299) | 319,850 | 803,970 |
Beginning balance (in shares) at Dec. 31, 2019 | 47,421,315 | 22,075,749 | ||||||
Increase (Decrease) in shareholders' equity | ||||||||
Net income (loss) | 24,447 | 24,447 | 16,844 | 41,291 | ||||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights | 33,736 | $ 12 | $ (12) | 33,736 | 33,736 | |||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights (in shares) | 1,180,368 | (1,180,368) | ||||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights | 64,813 | $ 20 | 64,793 | 64,813 | ||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights (in shares) | 1,943,838 | |||||||
Forfeiture of unvested Class A common stock | (27) | (27) | (27) | |||||
Forfeiture of unvested Class A common stock (in shares) | (834) | |||||||
Exercise of stock options | 1,559 | 1,559 | 1,559 | |||||
Exercise of stock options (in shares) | 49,685 | |||||||
Change in non-controlling interest allocation | (65,993) | (65,993) | (36,036) | (102,029) | ||||
Non-cash equity compensation expense | 3,397 | 3,397 | 3,397 | |||||
Currency translation adjustment - net of tax | 13 | 13 | 303 | 316 | ||||
Unrealized loss on interest rate swap designated as a cash flow hedge | (6,025) | (6,025) | (3,283) | (9,308) | ||||
Adjustment of deferred tax assets, net of amounts payable under tax receivable agreements and changes from Focus LLC interest transactions | 968 | 968 | 968 | |||||
Ending balance at Sep. 30, 2020 | 541,008 | $ 506 | $ 209 | 536,619 | 10,985 | (7,311) | 297,678 | 838,686 |
Ending Balance (in shares) at Sep. 30, 2020 | 50,594,372 | 20,895,381 | ||||||
Beginning balance at Jun. 30, 2020 | 504,732 | $ 481 | $ 215 | 503,209 | 9,343 | (8,516) | 326,478 | 831,210 |
Beginning balance (in shares) at Jun. 30, 2020 | 48,091,707 | 21,496,103 | ||||||
Increase (Decrease) in shareholders' equity | ||||||||
Net income (loss) | 1,642 | 1,642 | 2,302 | 3,944 | ||||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights | 20,370 | $ 6 | $ (6) | 20,370 | 20,370 | |||
Issuance (cancellation) of common stock in connection with exercise of Focus LLC common unit exchange rights (in shares) | 600,722 | (600,722) | ||||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights | 63,010 | $ 19 | 62,991 | 63,010 | ||||
Issuance of common stock in connection with exercise of Focus LLC incentive unit exchange rights (in shares) | 1,858,136 | |||||||
Exercise of stock options | 1,392 | 1,392 | 1,392 | |||||
Exercise of stock options (in shares) | 43,807 | |||||||
Change in non-controlling interest allocation | (53,865) | (53,865) | (32,019) | (85,884) | ||||
Non-cash equity compensation expense | 1,207 | 1,207 | 1,207 | |||||
Currency translation adjustment - net of tax | 1,823 | 1,823 | 1,280 | 3,103 | ||||
Unrealized loss on interest rate swap designated as a cash flow hedge | (618) | (618) | (363) | (981) | ||||
Adjustment of deferred tax assets, net of amounts payable under tax receivable agreements and changes from Focus LLC interest transactions | 1,315 | 1,315 | 1,315 | |||||
Ending balance at Sep. 30, 2020 | $ 541,008 | $ 506 | $ 209 | $ 536,619 | $ 10,985 | $ (7,311) | $ 297,678 | $ 838,686 |
Ending Balance (in shares) at Sep. 30, 2020 | 50,594,372 | 20,895,381 |
GENERAL
GENERAL | 9 Months Ended |
Sep. 30, 2020 | |
GENERAL | |
GENERAL | 1. GENERAL Organization and Business Focus LLC is a Delaware limited liability company that was formed in November 2004. Focus LLCâs subsidiaries commenced revenue-generating and acquisition activities in January 2006. Focus LLCâs activities are governed by its Fourth Amended and Restated Operating Agreement (as amended, the âOperating Agreementâ). Focus LLC is in the business of acquiring and overseeing independent fiduciary wealth management and related businesses. |
SUMMARY OF ACCOUNTING POLICIES
SUMMARY OF ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF ACCOUNTING POLICIES | |
SUMMARY OF ACCOUNTING POLICIES | 2. SUMMARY OF ACCOUNTING POLICIES Basis of Presentation Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. Use of Estimates Revenue The Company disaggregates revenue by wealth management fees and other. The Company does not allocate revenue by the type of service provided in connection with providing holistic wealth management client services. The Company generally manages its business based on the operating results of the enterprise taken as a whole, not by geographic region. The following table disaggregates the revenues based on the location of the partner firm legal entities that generate the revenues and therefore may not be reflective of the geography in which clients are located. â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â â September 30, â September 30, â â 2019 2020 2019 2020 â Domestic revenue â $ 302,572 â $ 313,956 â $ 844,784 â $ 933,420 â International revenue â 14,069 â 17,527 â 33,326 â 48,226 â Total revenue â $ 316,641 â $ 331,483 â $ 878,110 â $ 981,646 â â International revenue consists of revenue generated by partner firm legal entities in Australia, Canada and the United Kingdom. Derivatives The Company uses derivative instruments for purposes other than trading. Derivative instruments are accounted for in accordance with Accounting Standard Codification (âASCâ) Topic No. 815, Derivatives and Hedging Recent Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (âFASBâ) issued Accounting Standards Update (âASUâ) No. 2017-04, â Simplifying the Test for Goodwill Impairment In December 2019, the FASB issued ASU No. 2019-12, â Simplifying the Accounting for Income Taxes Income Taxes â In March 2020, the FASB issued ASU No. 2020-04, â Facilitation of the Effects of Reference Rate Reform on Financial Reporting adoption of ASU No. 2020-04 did not have a material impact on the Companyâs consolidated financial statements; however, the Company will continue to evaluate the impacts, if any, of the provisions of ASU No. 2020-04 on the Companyâs debt and hedging arrangements through December 31, 2022. |
NON-CONTROLLING INTEREST AND IN
NON-CONTROLLING INTEREST AND INCOME (LOSS) PER SHARE | 9 Months Ended |
Sep. 30, 2020 | |
NON-CONTROLLING INTEREST AND INCOME (LOSS) PER SHARE | |
NON-CONTROLLING INTEREST AND INCOME (LOSS) PER SHARE | 3. NON-CONTROLLING INTEREST AND INCOME (LOSS) PER SHARE The calculation of controlling and non-controlling interest is as follows as of September 30, 2019 and 2020: â â â â â â â â â 2019 â â 2020 â Focus LLC common units held by continuing owners 22,198,665 â â 20,895,381 â Common unit equivalents of outstanding vested and unvested incentive units held by continuing owners (1) â 4,006,594 â â 4,860,295 â Total common units and common unit equivalents attributable to non-controlling interest â 26,205,259 â â 25,755,676 â Total common units and common unit equivalents of incentive units outstanding â 73,461,166 â â 76,350,048 â Non-controlling interest allocation â 35.7 % â 33.7 % Companyâs interest in Focus LLC â 64.3 % â 66.3 % (1) Focus LLC common units issuable upon conversion of 17,748,891 and 16,658,578 (see Note 9) vested and unvested Focus LLC incentive units outstanding as of September 30, 2019 and 2020, respectively, was calculated using the common unit equivalent of vested and unvested Focus LLC incentive units based on the closing price of the Companyâs Class A common stock on the last trading day of the periods. The below table contains a reconciliation of net income to net income (loss) attributable to common shareholders: â â â â â â â â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â September 30, â September 30, â â â 2019 2020 2019 2020 â Net income â $ 392 â $ 3,944 â $ 666 â $ 41,291 â Non-controlling interest â 881 â (2,302) â (1,539) â (16,844) â Net income (loss) attributable to common shareholders â $ 1,273 â $ 1,642 â $ (873) â $ 24,447 â â The calculation of basic and diluted income (loss) per share is described below: Basic income (loss) per share is calculated utilizing net income (loss) attributable to common shareholders divided by the weighted average number of shares of Class A common stock outstanding during the same periods: â â â â â â â â â â â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â September 30, â September 30, â â â 2019 2020 2019 2020 â Basic income (loss) per share: â â â â â â â â â Net income (loss) attributable to common shareholders â $ 1,273 â $ 1,642 â $ (873) â $ 24,447 â Weighted average shares of Class A common stock outstanding â 47,044,507 â 48,683,580 â 46,653,820 â 47,991,831 â Basic income (loss) per share â $ 0.03 â $ 0.03 â $ (0.02) â $ 0.51 â â Diluted income (loss) per share is calculated utilizing net income (loss) attributable to common shareholders divided by the weighted average number of shares of Class A common stock outstanding during the same periods plus the effect, if any, of the potentially dilutive shares of the Companyâs Class A common stock from stock options, unvested Class A common stock, restricted stock units and Focus LLC common and incentive units as calculated using the treasury stock method: â â â â â â â â â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â â September 30, â â September 30, â 2019 2020 2019 2020 Diluted income (loss) per share: â â â â â â â Net income (loss) attributable to common shareholders â $ 1,273 â $ 1,642 â $ (873) â $ 24,447 Add: Dilutive effect of non-controlling interests related to Focus LLC common and incentive units â â â â â â â â â â â â Total â â 1,273 â â 1,642 â â (873) â â 24,447 â â â â â â â â â â â â â Weighted average shares of Class A common stock outstanding â 47,044,507 â 48,683,580 â 46,653,820 â 47,991,831 Effect of dilutive stock options â â â â â 60,974 â â â â â 21,728 Effect of dilutive unvested Class A common stock and restricted stock units â â 14,106 â â 65,774 â â â â â 26,455 Effect of dilutive non-controlling interests related to Focus LLC common and incentive units â â â â â â â â â â â â Total â 47,058,613 â 48,810,328 â 46,653,820 â 48,040,014 Diluted income (loss) per share â $ 0.03 â $ 0.03 â $ (0.02) â $ 0.51 â Diluted loss per share for the nine months ended September 30, 2019 excludes incremental shares of 15,773 related to unvested Class A common stock since the effect would be antidilutive. Diluted income (loss) per share for the three and nine months ended September 30, 2019 and 2020 excludes shares related to 155,000 market-based stock options that vest on the fifth anniversary of the pricing of the Companyâs IPO if the volume weighted average per share price for any ninety Focus LLC common and incentive units may be exchanged for the Companyâs Class A common stock, subject to certain limitations (see Note 9). In computing the dilutive effect, if any, that the exchange would have on net income (loss) per share, net income (loss) attributable to Class A common shareholders would be adjusted due to the elimination of the non-controlling interests (including any associated tax impact). For the three and nine months ended September 30, 2019 and 2020, such exchange is not reflected in diluted net income (loss) per share as the assumed exchange is not dilutive. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Sep. 30, 2020 | |
ACQUISITIONS | |
ACQUISITIONS | 4. ACQUISITIONS Business Acquisitions Business acquisitions are accounted for in accordance with ASC Topic 805: Business Combinations The Company has incorporated contingent consideration, or earn out provisions, into the structure of its acquisitions. The Company recognizes the fair value of estimated contingent consideration at the acquisition date as part of the consideration transferred in the exchange. The contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved. The purchase price associated with business acquisitions and the allocation thereof during the nine months ended September 30, 2020 is as follows: â â â â â Number of business acquisitions closed â 7 Consideration: â â â Cash due at closing â $ 68,726 Working capital adjustments â â (174) Fair market value of estimated contingent consideration â â 8,963 Total consideration â $ 77,515 Allocation of purchase price: â â â Total tangible assets â $ 8,001 Total liabilities assumed â â (15,600) Customer relationships â â 48,450 Management contracts â â 1,564 Goodwill â â 34,897 Other acquired intangibles â â 203 Total allocated consideration â $ 77,515 â Management believes approximately $47,931 of tax goodwill and intangibles related to business acquisitions completed during the nine months ended September 30, 2020 will be deductible for tax purposes over a 15 year period. Additional tax goodwill may be deductible when estimated contingent consideration is earned and paid. The accompanying unaudited condensed consolidated statement of operations for the nine months ended September 30, 2020 includes revenue and income from operations for the two business acquisitions that are new subsidiary partner firms from the dates they were acquired of $6,996 and $1,053, respectively. Asset Acquisitions The Company also separately purchases customer relationships and other intangible assets. These purchases are accounted for as asset acquisitions as they do not qualify as business acquisitions pursuant to ASC Topic 805, Business Combinations The weighted-average useful lives of intangible assets acquired during the nine months ended September 30, 2020 through business acquisitions and asset acquisitions are as follows: â â â â â â â â Number of years Management contracts â 16 Customer relationships â 8 Other acquired intangibles â 5 Weighted-average useful life of all intangibles acquired â 9 â From October 1, 2020 to November 5, 2020, the Company completed 4 business acquisition for cash of $51,447, plus contingent consideration. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2020 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | 5. GOODWILL AND OTHER INTANGIBLE ASSETS The following table summarizes the change in the goodwill balances for the year ended December 31, 2019 and the nine months ended September 30, 2020: â â â â â â â â â December 31, September 30, â â 2019 â 2020 Balance beginning of period: â â â â â â Goodwill â $ 883,119 â $ 1,112,855 Cumulative impairment losses â (22,624) â â (22,624) â â â 860,495 â â 1,090,231 Goodwill acquired â 229,799 â â 34,897 Other â (63) â â 476 â â 229,736 â â 35,373 Balance end of period: â â â â â â Goodwill â 1,112,855 â â 1,148,228 Cumulative impairment losses â (22,624) â â (22,624) â â $ 1,090,231 â $ 1,125,604 â The following table summarizes the amortizing acquired intangible assets at December 31, 2019: â â â â â â â â â â â â â Gross Carry â Accumulated â Net Book â Amount Amortization Value Customer relationships â $ 1,362,104 â $ (471,361) â $ 890,743 Management contracts â 150,464 â (39,888) â 110,576 Other acquired intangibles â 5,157 â (3,020) â 2,137 Total â $ 1,517,725 â $ (514,269) â $ 1,003,456 â The following table summarizes the amortizing acquired intangible assets at September 30, 2020: â â â â â â â â â â â â Gross Carry Accumulated Net Book â â Amount â Amortization â Value Customer relationships â $ 1,413,086 â â (573,433) â â 839,653 Management contracts â 152,006 â â (45,785) â â 106,221 Other acquired intangibles â 5,488 â â (3,635) â â 1,853 Total â $ 1,570,580 â $ (622,853) â $ 947,727 â |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2020 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 6. FAIR VALUE MEASUREMENTS ASC Topic 820, Fair Value Measurement The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels, as follows: Level 1 Level 2 Level 3 First Lien Term Loan â The implied fair value of the Companyâs First Lien Term Loan (as defined below) based on Level 2 inputs at December 31, 2019 and September 30, 2020 are as follows: â â â â â â â â â â â â â â â â December 31, 2019 â September 30, 2020 â Stated Fair Stated Fair â â Value â Value â Value â Value First Lien Term Loan â $ 1,139,188 â $ 1,146,307 â $ 1,130,514 â $ 1,095,185 â Derivatives At September 30, 2020, the fair value of the Companyâs $850,000 notional amount interest rate swap agreements was $(11,337). The fair value was based on Level 2 inputs which included the relevant interest rate forward curves. Business acquisitions For business acquisitions, the Company recognizes the fair value of goodwill and other acquired intangible assets, and estimated contingent consideration at the acquisition date as part of purchase price. This fair value measurement is based on unobservable (Level 3) inputs. The following table represents changes in the fair value of estimated contingent consideration for business acquisitions for the year ended December 31, 2019 and the nine months ended September 30, 2020: â â â â â Balance at January 1, 2019 $ 98,905 Additions to estimated contingent consideration â â 82,781 Payments of contingent consideration â â (36,862) Non-cash changes in fair value of estimated contingent consideration â â 38,797 Other â â (53) Balance at December 31, 2019 â $ 183,568 Additions to estimated contingent consideration â â 8,963 Payments of contingent consideration â â (73,588) Non-cash changes in fair value of estimated contingent consideration â â (621) Other â â (219) Balance at September 30, 2020 â $ 118,103 â Estimated contingent consideration is included in other liabilities in the accompanying unaudited condensed consolidated balance sheets. During the year ended December 31, 2019, the Company paid $36,862 in cash as contingent consideration associated with business acquisitions. During the nine months ended September 30, 2020, the Company paid $73,588 in cash as contingent consideration associated with business acquisitions. In addition, the Company also paid $2,537 and $1,961 of contingent consideration for the nine months ended September 30, 2019 and 2020, respectively, associated with asset acquisitions. These amounts are included in cash paid for acquisitions and contingent considerationânet of cash acquired in investing activities in the unaudited condensed consolidated statement of cash flows. In determining fair value of the estimated contingent consideration, the acquired businessâ future performance is estimated using financial projections for the acquired business. These financial projections, as well as alternative scenarios of financial performance, are measured against the performance targets specified in each respective acquisition agreement. In addition, discount rates are established based on the cost of debt and the cost of equity. The Company uses the Monte Carlo Simulation Model to determine the fair value of the Companyâs estimated contingent consideration. The significant unobservable inputs used in the fair value measurement of the Companyâs estimated contingent consideration are the forecasted growth rates over the measurement period and discount rates. Significant increases or decreases in the Companyâs forecasted growth rates over the measurement period or discount rates would result in a higher or lower fair value measurement. Inputs used in the fair value measurement of estimated contingent consideration at December 31, 2019 and September 30, 2020 are summarized below: â â â â â â â â â â â â Quantitative Information About Level 3 â â Fair Value Measurements Fair Value at Valuation Unobservable â December 31, 2019 â Techniques â Inputs â Ranges $ 183,568 â Monte Carlo Simulation Model â Forecasted growth rates â (10.7)% - 51.1 % â â â â â Discount rates â 11.0% - 17.0 % â â â â â â â â â â â â Quantitative Information About Level 3 â â Fair Value Measurements Fair Value at Valuation Unobservable â September 30, 2020 â Techniques â Inputs â Ranges $ 118,103 â Monte Carlo Simulation Model â Forecasted growth rates â (29.5)% - 57.5 % â â â â â Discount rates â 6.4% - 18.0 % â |
CREDIT FACILITY
CREDIT FACILITY | 9 Months Ended |
Sep. 30, 2020 | |
CREDIT FACILITY | |
CREDIT FACILITY | 7. CREDIT FACILITY As of September 30, 2020, Focus LLCâs credit facility (the âCredit Facilityâ) consisted of a $1,153,000 first lien term loan (the âFirst Lien Term Loanâ) and a $650,000 first lien revolving credit facility (the âFirst Lien Revolverâ). The First Lien Term Loan has a maturity date of July 2024 and requires quarterly installment repayments of The First Lien Revolver has a maturity date of July 2023. Up to $30,000 of the First Lien Revolver is available for the issuance of letters of credit, subject to certain limitations. The First Lien Revolver bears interest (at Focus LLCâs option) at LIBOR plus a margin of 2.00% with step downs to 1.75%, 1.50% and 1.25% or the lenderâs Base Rate plus a margin of 1.00% with step downs to 0.75%, 0.50% and 0.25%, based on achievement of a specified First Lien Leverage Ratio. The First Lien Revolver unused commitment fee is 0.50% with step downs to 0.375% and 0.25% based on achievement of a specified First Lien Leverage Ratio. Focus LLCâs obligations under the Credit Facility are collateralized by the majority of Focus LLCâs assets. The Credit Facility contains various customary covenants, including, but not limited to: (i) incurring additional indebtedness or guarantees, (ii) creating liens or other encumbrances on property or granting negative pledges, (iii) entering into a merger or similar transaction, (iv) selling or transferring certain property and (v) declaring dividends or making other restricted payments. Focus LLC is required to maintain a First Lien Leverage Ratio (as defined in the Credit Facility) of not more than 6.25:1.00 as of the last day of each fiscal quarter. At September 30, 2020, Focus LLC's First Lien Leverage Ratio was 3.67:1.00, which satisfied the maximum ratio of 6.25:1.00. First Lien Leverage Ratio means the ratio of amounts outstanding under the First Lien Term Loan and First Lien Revolver plus other outstanding debt obligations secured by a lien on the assets of Focus LLC (excluding letters of credit other than unpaid drawings thereunder) minus unrestricted cash and cash equivalents to Consolidated EBITDA (as defined in the Credit Facility). Consolidated EBITDA for purposes of the Credit Facility was $332,317 at September 30, 2020. Focus LLC is also subject on an annual basis to contingent principal payments based on an excess cash flow calculation (as defined in the Credit Facility) for any fiscal year if the First Lien Leverage Ratio exceeds 3.75:1.00. No contingent principal payments were required to be made in 2019. Based on the excess cash flow calculation for the year ended December 31, 2019, no contingent principal payments are required to be made in 2020. The Company defers and amortizes its debt financing costs over the respective terms of the First Lien Term Loan and First Lien Revolver. The debt financing costs related to the First Lien Term Loan are recorded as a reduction of the carrying amount of the First Lien Term Loan in the unaudited condensed consolidated balance sheets. The debt financing costs related to the First Lien Revolver are recorded in debt financing costs-net in the unaudited condensed consolidated balance sheets. The following is a reconciliation of principal amounts outstanding under the Credit Facility to borrowings under the Credit Facility recorded in the unaudited condensed consolidated balance sheets at December 31, 2019 and September 30, 2020: â â â â â â â â â December 31, September 30, â â 2019 â 2020 First Lien Term Loan â $ 1,139,188 â $ 1,130,514 First Lien Revolver â â 140,000 â â 130,000 Unamortized debt financing costs â (5,389) â (539) Unamortized discount â (800) â â Total â $ 1,272,999 â $ 1,259,975 â At December 31, 2019 and September 30, 2020, unamortized debt financing costs associated with the First Lien Revolver of $9,645 and $7,623, respectively, were recorded in debt financing costs-net in the condensed consolidated balance sheets. Weighted-average interest rates for outstanding borrowings were approximately 5% for the year ended December 31, 2019 and approximately 3% for the nine months ended September 30, 2020. As of December 31, 2019 and September 30, 2020, the First Lien Revolver available unused commitment line was $502,962 and $512,266, respectively. As of December 31, 2019 and September 30, 2020, Focus LLC was contingently obligated for letters of credit in the amount of $7,038 and $7,734, respectively, each bearing interest at an annual rate of approximately 2%. |
DERIVATIVES
DERIVATIVES | 9 Months Ended |
Sep. 30, 2020 | |
DERIVATIVES | |
DERIVATIVES | 8. DERIVATIVES In March 2020, the Company entered into a 4 year floating to fixed interest rate swap with a notional amount of $400,000. The interest rate swap effectively fixes the variable interest rate applicable to $400,000 of borrowings outstanding on the First Lien Term Loan. The terms of the interest rate swap provide that the Company pays interest to the counterparty each month at a rate of 0.713% and receive interest from the counterparty each month at the 1 month USD LIBOR rate, subject to a 0% floor. In April 2020, the Company entered into two additional 4 year floating to fixed interest rate swap agreements with notional amounts of $250,000 and $200,000, respectively. These swaps effectively fix the variable interest rate applicable to $450,000 of borrowings outstanding on the First Lien Term Loan. The terms of these swaps provide that the Company pays interest to the counterparties each month at a rate of 0.537% and 0.5315%, respectively, and receive interest from the counterparties each month at the 1 month USD LIBOR rate, subject to a 0% floor. The Company designated these swaps as cash flow hedges of the Companyâs exposure to the variability of the payment of interest on these portions of its First Lien Term Loan borrowings. At September 30, 2020, the fair value of the interest rate swaps was $(11,337), which is included in other liabilities in the accompanying unaudited condensed consolidated balance sheet. The interest rate swaps continue to be effective hedges, and as such, the offsetting adjustment to the fair value is recorded in accumulated other comprehensive loss, net of tax of $2,029. |
EQUITY
EQUITY | 9 Months Ended |
Sep. 30, 2020 | |
EQUITY | |
EQUITY | 9. EQUITY Exchange rights Each Focus LLC common unit, together with a corresponding share of the Companyâs Class B common stock, and Focus LLC incentive unit (after conversion into a number of Focus LLC common units taking into account the then-current value of the common units and such incentive unitâs aggregate hurdle amount) is exchangeable, pursuant to the terms and subject to the conditions set forth in the Operating Agreement, for one share of the Companyâs Class A common stock, or, if either the Company or Focus LLC so elects, cash. In March 2020, the Company issued an aggregate of 383,001 shares of Class A common stock and retired 316,370 shares of Class B common stock and 162,871 incentive units in Focus LLC and acquired 383,001 common units in Focus LLC, in each case as part of the regular quarterly exchanges offered to holders of units in Focus LLC. In June 2020, the Company issued an aggregate of 282,347 shares of Class A common stock and retired 263,276 shares of Class B common stock and 35,000 incentive units in Focus LLC and acquired 282,347 common units in Focus LLC, in each case as part of the regular quarterly exchanges offered to holders of units in Focus LLC. In September 2020, the Company issued an aggregate of 2,458,858 shares of Class A common stock and retired 600,722 shares of Class B common stock and 2,706,350 incentive units in Focus LLC and acquired 2,458,858 common units in Focus LLC, in each case as part of the regular quarterly exchanges offered to holders of units in Focus LLC. Stock Options, Unvested Class A Common Stock and Restricted Stock Units The following table provides information relating to the changes in the Companyâs stock options during the nine months ended September 30, 2020: â â â â â â â â Stock Weighted Average â â Options â Exercise Price OutstandingâJanuary 1, 2020 1,832,966 â $ 30.42 Granted â â â â â Exercised â (49,685) â â 31.40 Forfeited â (21,817) â â 29.27 OutstandingâSeptember 30, 2020 â 1,761,464 â â 30.40 VestedâSeptember 30, 2020 â 669,441 â â 32.06 â The following table provides information relating to the changes in the Companyâs unvested Class A common stock during the nine months ended September 30, 2020: â â â â â â â â â â â Weighted â â â â Average â â Unvested Class A â Grant Date â Common Stock Fair Value OutstandingâJanuary 1, 2020 53,293 â $ 33.00 Forfeited â (834) â â 33.00 Vested â â â â â OutstandingâSeptember 30, 2020 â 52,459 â â 33.00 â â â â â â â â â â â â Weighted â â â â Average â â Restricted Stock â Grant Date â Units Fair Value OutstandingâJanuary 1, 2020 98,061 â $ 27.90 Granted â â â â â Forfeited â (7,707) â â 27.90 Vested â â â â â OutstandingâSeptember 30, 2020 â 90,354 â â 27.90 â The Company recognized $1,011 and $3,071 of non-cash equity compensation expense in relation to the stock options and unvested Class A common stock during the three and nine months ended September 30, 2019, respectively. The Company recognized $1,380 and $3,910 of non-cash equity compensation expense in relation to the stock options, unvested Class A common stock and restricted stock units during the three and nine months ended September 30, 2020, respectively. Focus LLC Incentive Units The following table provides information relating to the changes in Focus LLC incentive units during the nine months ended September 30, 2020: â â â â â â â â â Weighted Average â â Incentive Units â Hurdle Price OutstandingâJanuary 1, 2020 19,754,450 â $ 21.59 Granted 30,000 â â 30.48 Exchanged â (2,904,221) â â 11.80 Forfeited (221,651) â â 24.67 OutstandingâSeptember 30, 2020 16,658,578 â 23.28 VestedâSeptember 30, 2020 7,334,000 â 16.81 â â Incentive units outstanding and vested at September 30, 2020 were as follows: â â â â â â â Number Vested Hurdle Rates â Outstanding â Units $1.42 421 â 421 5.50 798 â 798 6.00 386 â 386 7.00 1,081 â 1,081 9.00 1,323,708 â 1,323,708 11.00 841,706 â 841,706 12.00 520,000 â 520,000 13.00 579,213 â 579,213 14.00 17,848 â 17,848 16.00 48,054 â 48,054 17.00 22,500 â 22,500 19.00 635,964 â 635,964 21.00 3,608,442 â 2,108,442 22.00 1,112,903 â 518,696 23.00 524,828 â 262,414 26.26 â 25,000 â â 27.00 29,484 â 14,742 27.90 â 2,051,131 â â 28.50 â 1,585,111 â 388,027 30.48 â 30,000 â â 33.00 3,670,000 â 40,000 36.64 â 30,000 â 10,000 â â 16,658,578 â 7,334,000 â The Company recorded $3,265 and $10,304 of non-cash equity compensation expense for incentive units during the three and nine months ended September 30, 2019, respectively. The Company recorded $3,926 and $11,678 of non-cash equity compensation expense for incentive units during the three and nine months ended September 30, 2020, respectively. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2020 | |
INCOME TAXES | |
INCOME TAXES | 10. INCOME TAXES The estimated annual effective tax rate for the nine months ended September 30, 2020 was 25.8% as compared to (141.7)% for the year ended December 31, 2019. The increase in the estimated annual effective tax rate is primarily attributable to expected full year income before income taxes for the year ending December 31, 2020 as compared to the loss before income taxes for the year ended December 31, 2019. For the nine months ended September 30, 2020, we recorded a discrete income tax expense of $1,599 primarily related to newly issued regulations relating to the limitation on the deduction of business interest expense. Income tax expense for the nine months ended September 30, 2020 is primarily related to federal, state and local income taxes imposed on the Companyâs allocable portion of taxable income from Focus LLC. The allocable portion of taxable income primarily differs from the net income (loss) attributable to the Company due to permanent differences such as non-deductible equity-based compensation expense of Focus LLC. During the nine months ended September 30, 2020, there were no changes to the Companyâs uncertain tax positions. |
TAX RECEIVABLE AGREEMENTS
TAX RECEIVABLE AGREEMENTS | 9 Months Ended |
Sep. 30, 2020 | |
TAX RECEIVABLE AGREEMENTS | |
TAX RECEIVABLE AGREEMENTS | 11. TAX RECEIVABLE AGREEMENTS In connection with the Reorganization Transactions and the closing of the IPO, the Company entered into two Tax Receivable Agreements (âTRAsâ): one with certain entities affiliated with the Companyâs private equity investors and the other with certain other continuing and former owners of Focus LLC. In March 2020 Focus Inc. entered into an additional Tax Receivable Agreement for TRA holders that join Focus LLC as members after the closing of the IPO (the parties to the three agreements, collectively, the âTRA holdersâ). New Focus LLC owners in the future may also become party to this additional Tax Receivable Agreement. The agreements generally provide for the payment by the Company to each TRA holder of 85% of the net cash savings, if any, in U.S. federal, state and local income and franchise tax that the Company actually realizes (computed using simplifying assumptions to address the impact of state and local taxes) or is deemed to realize in certain circumstances in connection with the Reorganization Transactions and in periods after the IPO or after entering into the Tax Receivable Agreement, as applicable, as a result of certain increases in tax bases and certain tax benefits attributable to imputed interest. The Company will retain the benefit of the remaining 15% of these cash savings. As of September 30, 2020, the Company had recorded a liability of $78,124 relating to the TRA obligations. Future payments under the TRAs in respect of future exchanges of Focus LLC units for shares of Class A common stock will be in addition to the amount recorded. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 12. COMMITMENTS AND CONTINGENCIES Credit Risk In addition, the Company has the right to pursue collection or performance from the counterparties who do not perform under their contractual obligations. The Company monitors the credit standing of the clearing brokers and counterparties with which they conduct business. The Company is exposed to credit risk for accounts receivable from clients. Such credit risk is limited to the amount of accounts receivable. The Company is also exposed to credit risk for changes in the benchmark interest rate (LIBOR or Base Rate) in connection with its Credit Facility. The counterparties to the Companyâs derivative financial instruments are major international financial institutions. The Company is exposed to credit risk for the net exchanges under these agreements, but not for the notional amounts. The Company does not anticipate non-performance by any of its counterparties. The Company maintains its cash in bank depository accounts, which, at times, may exceed federally insured limits. The Company selects depository institutions based, in part, upon managementâs review of the financial stability of the institution. At December 31, 2019 and September 30, 2020, a significant portion of cash and cash equivalents were held at a single institution. Contingent Consideration Arrangements performance levels over a number of years, the Company cannot calculate the maximum contingent consideration that may be payable under these arrangements. Legal and Regulatory Matters From time to time, the Companyâs subsidiaries receive requests for information from governmental authorities regarding business activities. The Company has cooperated and plans to continue to cooperate with all governmental agencies. The Company continues to believe that the resolution of any governmental inquiry will not have a material impact on the Companyâs consolidated financial position, results of operations or cash flows. Indemnifications Management believes that the likelihood of any material liability arising under these indemnification provisions is remote. Management cannot estimate any potential maximum exposure due to both the remoteness of any potential claims and the fact that items that would be included within any such calculated claim would be beyond the control of the Company. Consequently, no liability has been recorded in the unaudited condensed consolidated balance sheets. |
CASH FLOW INFORMATION
CASH FLOW INFORMATION | 9 Months Ended |
Sep. 30, 2020 | |
CASH FLOW INFORMATION | |
CASH FLOW INFORMATION | 13. CASH FLOW INFORMATION â â â â â â â â â â Nine Months Ended â â September 30, â 2019 2020 Supplemental disclosures of cash flow informationâcash paid for: â â â â â â Interest â $ 41,782 â $ 32,109 Income taxes â $ 5,011 â $ 13,036 Supplemental non-cash cash flow information: â â Fair market value of estimated contingent consideration in connection with acquisitions â $ 70,209 â $ 8,963 Net tangible liabilities acquired in connection with business acquisitions â $ (2,636) â $ (7,599) Discount on proceeds from Credit Facility â $ 875 â $ â Operating lease assets â $ 167,866 â $ 236,822 Operating lease liabilities â $ 183,491 â $ 256,903 â |
RELATED PARTIES
RELATED PARTIES | 9 Months Ended |
Sep. 30, 2020 | |
RELATED PARTIES | |
RELATED PARTIES | 14. RELATED PARTIES The Companyâs Chief Executive Officer, through an entity owned and controlled by him, owns a personal aircraft that was acquired without Company resources that he uses for business travel. The Company reimburses the Companyâs Chief Executive Officer for certain costs and third party payments associated with the use of his personal aircraft for Company-related business travel. The Company also pays pilot fees for such business travel flights. During the three and nine months ended September 30, 2019, the Company recognized expenses of $498 and $1,568, respectively, related to these reimbursements. During the three and nine months ended September 30, 2020, the Company recognized expenses of $267 and $719, respectively, related to these reimbursements. Given the geography of the Companyâs partner firms and prospects, the Company believes that the use of private aircraft creates efficiencies to enhance the productivity of the Companyâs Chief Executive Officer and certain other authorized personnel. At September 30, 2020, affiliates of certain holders of the Companyâs Class A common stock and Class B common stock were lenders under the Credit Facility. |
OTHER
OTHER | 9 Months Ended |
Sep. 30, 2020 | |
OTHER | |
OTHER | 15. OTHER During the three months ended March 31, 2019, the Company recorded a management contract buyout expense of $1,428 related to cash consideration for the buyout of a management agreement with one of the Companyâs retiring principals whereby the business operations of the relevant partner firm were transitioned to one of the Companyâs other partner firms. |
SUMMARY OF ACCOUNTING POLICIES
SUMMARY OF ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. |
Use of Estimates | Use of Estimates |
Revenue | Revenue The Company disaggregates revenue by wealth management fees and other. The Company does not allocate revenue by the type of service provided in connection with providing holistic wealth management client services. The Company generally manages its business based on the operating results of the enterprise taken as a whole, not by geographic region. The following table disaggregates the revenues based on the location of the partner firm legal entities that generate the revenues and therefore may not be reflective of the geography in which clients are located. â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â â September 30, â September 30, â â 2019 2020 2019 2020 â Domestic revenue â $ 302,572 â $ 313,956 â $ 844,784 â $ 933,420 â International revenue â 14,069 â 17,527 â 33,326 â 48,226 â Total revenue â $ 316,641 â $ 331,483 â $ 878,110 â $ 981,646 â â International revenue consists of revenue generated by partner firm legal entities in Australia, Canada and the United Kingdom. |
Derivatives | Derivatives The Company uses derivative instruments for purposes other than trading. Derivative instruments are accounted for in accordance with Accounting Standard Codification (âASCâ) Topic No. 815, Derivatives and Hedging |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2017, the Financial Accounting Standards Board (âFASBâ) issued Accounting Standards Update (âASUâ) No. 2017-04, â Simplifying the Test for Goodwill Impairment In December 2019, the FASB issued ASU No. 2019-12, â Simplifying the Accounting for Income Taxes Income Taxes â In March 2020, the FASB issued ASU No. 2020-04, â Facilitation of the Effects of Reference Rate Reform on Financial Reporting adoption of ASU No. 2020-04 did not have a material impact on the Companyâs consolidated financial statements; however, the Company will continue to evaluate the impacts, if any, of the provisions of ASU No. 2020-04 on the Companyâs debt and hedging arrangements through December 31, 2022. |
SUMMARY OF ACCOUNTING POLICIE_2
SUMMARY OF ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF ACCOUNTING POLICIES | |
Schedule of disaggregated revenues based on the location of the partner firm | â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â â September 30, â September 30, â â 2019 2020 2019 2020 â Domestic revenue â $ 302,572 â $ 313,956 â $ 844,784 â $ 933,420 â International revenue â 14,069 â 17,527 â 33,326 â 48,226 â Total revenue â $ 316,641 â $ 331,483 â $ 878,110 â $ 981,646 â |
NON-CONTROLLING INTERESTS AND I
NON-CONTROLLING INTERESTS AND INCOME (LOSS) PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
NON-CONTROLLING INTEREST AND INCOME (LOSS) PER SHARE | |
Schedule of controlling and non-controlling interest | â â â â â â â â â 2019 â â 2020 â Focus LLC common units held by continuing owners 22,198,665 â â 20,895,381 â Common unit equivalents of outstanding vested and unvested incentive units held by continuing owners (1) â 4,006,594 â â 4,860,295 â Total common units and common unit equivalents attributable to non-controlling interest â 26,205,259 â â 25,755,676 â Total common units and common unit equivalents of incentive units outstanding â 73,461,166 â â 76,350,048 â Non-controlling interest allocation â 35.7 % â 33.7 % Companyâs interest in Focus LLC â 64.3 % â 66.3 % (1) Focus LLC common units issuable upon conversion of 17,748,891 and 16,658,578 (see Note 9) vested and unvested Focus LLC incentive units outstanding as of September 30, 2019 and 2020, respectively, was calculated using the common unit equivalent of vested and unvested Focus LLC incentive units based on the closing price of the Companyâs Class A common stock on the last trading day of the periods. |
Schedule of reconciliation of net income before noncontrolling interest to net income (loss) attributable to common stockholders | â â â â â â â â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â September 30, â September 30, â â â 2019 2020 2019 2020 â Net income â $ 392 â $ 3,944 â $ 666 â $ 41,291 â Non-controlling interest â 881 â (2,302) â (1,539) â (16,844) â Net income (loss) attributable to common shareholders â $ 1,273 â $ 1,642 â $ (873) â $ 24,447 â |
Schedule of calculation of basic earnings per share | â â â â â â â â â â â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â September 30, â September 30, â â â 2019 2020 2019 2020 â Basic income (loss) per share: â â â â â â â â â Net income (loss) attributable to common shareholders â $ 1,273 â $ 1,642 â $ (873) â $ 24,447 â Weighted average shares of Class A common stock outstanding â 47,044,507 â 48,683,580 â 46,653,820 â 47,991,831 â Basic income (loss) per share â $ 0.03 â $ 0.03 â $ (0.02) â $ 0.51 â |
Schedule of calculation of diluted earnings per share | â â â â â â â â â â â â â â â â â â â â â â â â â Three Months Ended â Nine Months Ended â â â September 30, â â September 30, â 2019 2020 2019 2020 Diluted income (loss) per share: â â â â â â â Net income (loss) attributable to common shareholders â $ 1,273 â $ 1,642 â $ (873) â $ 24,447 Add: Dilutive effect of non-controlling interests related to Focus LLC common and incentive units â â â â â â â â â â â â Total â â 1,273 â â 1,642 â â (873) â â 24,447 â â â â â â â â â â â â â Weighted average shares of Class A common stock outstanding â 47,044,507 â 48,683,580 â 46,653,820 â 47,991,831 Effect of dilutive stock options â â â â â 60,974 â â â â â 21,728 Effect of dilutive unvested Class A common stock and restricted stock units â â 14,106 â â 65,774 â â â â â 26,455 Effect of dilutive non-controlling interests related to Focus LLC common and incentive units â â â â â â â â â â â â Total â 47,058,613 â 48,810,328 â 46,653,820 â 48,040,014 Diluted income (loss) per share â $ 0.03 â $ 0.03 â $ (0.02) â $ 0.51 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
ACQUISITIONS | |
Schedule of purchase price associated with business acquisitions and the allocation thereof | â â â â â Number of business acquisitions closed â 7 Consideration: â â â Cash due at closing â $ 68,726 Working capital adjustments â â (174) Fair market value of estimated contingent consideration â â 8,963 Total consideration â $ 77,515 Allocation of purchase price: â â â Total tangible assets â $ 8,001 Total liabilities assumed â â (15,600) Customer relationships â â 48,450 Management contracts â â 1,564 Goodwill â â 34,897 Other acquired intangibles â â 203 Total allocated consideration â $ 77,515 â |
Schedule of weighted-average useful lives of intangible assets acquired | The weighted-average useful lives of intangible assets acquired during the nine months ended September 30, 2020 through business acquisitions and asset acquisitions are as follows: â â â â â â â â Number of years Management contracts â 16 Customer relationships â 8 Other acquired intangibles â 5 Weighted-average useful life of all intangibles acquired â 9 â |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Summary of changes in the goodwill balances | â â â â â â â â â December 31, September 30, â â 2019 â 2020 Balance beginning of period: â â â â â â Goodwill â $ 883,119 â $ 1,112,855 Cumulative impairment losses â (22,624) â â (22,624) â â â 860,495 â â 1,090,231 Goodwill acquired â 229,799 â â 34,897 Other â (63) â â 476 â â 229,736 â â 35,373 Balance end of period: â â â â â â Goodwill â 1,112,855 â â 1,148,228 Cumulative impairment losses â (22,624) â â (22,624) â â $ 1,090,231 â $ 1,125,604 â |
Summary of amortizing acquired intangible assets | The following table summarizes the amortizing acquired intangible assets at December 31, 2019: â â â â â â â â â â â â â Gross Carry â Accumulated â Net Book â Amount Amortization Value Customer relationships â $ 1,362,104 â $ (471,361) â $ 890,743 Management contracts â 150,464 â (39,888) â 110,576 Other acquired intangibles â 5,157 â (3,020) â 2,137 Total â $ 1,517,725 â $ (514,269) â $ 1,003,456 â The following table summarizes the amortizing acquired intangible assets at September 30, 2020: â â â â â â â â â â â â Gross Carry Accumulated Net Book â â Amount â Amortization â Value Customer relationships â $ 1,413,086 â â (573,433) â â 839,653 Management contracts â 152,006 â â (45,785) â â 106,221 Other acquired intangibles â 5,488 â â (3,635) â â 1,853 Total â $ 1,570,580 â $ (622,853) â $ 947,727 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
FAIR VALUE MEASUREMENTS | |
Schedule of implied fair value of the Company's First Lien Term Loan (as defined below) | â â â â â â â â â â â â â â â â December 31, 2019 â September 30, 2020 â Stated Fair Stated Fair â â Value â Value â Value â Value First Lien Term Loan â $ 1,139,188 â $ 1,146,307 â $ 1,130,514 â $ 1,095,185 |
Schedule of changes in the fair value of estimated contingent consideration for business acquisitions | â â â â â Balance at January 1, 2019 $ 98,905 Additions to estimated contingent consideration â â 82,781 Payments of contingent consideration â â (36,862) Non-cash changes in fair value of estimated contingent consideration â â 38,797 Other â â (53) Balance at December 31, 2019 â $ 183,568 Additions to estimated contingent consideration â â 8,963 Payments of contingent consideration â â (73,588) Non-cash changes in fair value of estimated contingent consideration â â (621) Other â â (219) Balance at September 30, 2020 â $ 118,103 â |
Schedule of inputs used in the fair value measurement of estimated contingent consideration | â â â â â â â â â â â â Quantitative Information About Level 3 â â Fair Value Measurements Fair Value at Valuation Unobservable â December 31, 2019 â Techniques â Inputs â Ranges $ 183,568 â Monte Carlo Simulation Model â Forecasted growth rates â (10.7)% - 51.1 % â â â â â Discount rates â 11.0% - 17.0 % â â â â â â â â â â â â Quantitative Information About Level 3 â â Fair Value Measurements Fair Value at Valuation Unobservable â September 30, 2020 â Techniques â Inputs â Ranges $ 118,103 â Monte Carlo Simulation Model â Forecasted growth rates â (29.5)% - 57.5 % â â â â â Discount rates â 6.4% - 18.0 % |
CREDIT FACILITY (Tables)
CREDIT FACILITY (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
CREDIT FACILITY | |
Schedule of reconciliation of principal amounts outstanding under the Credit Facility to borrowings under credit facilities recorded in the unaudited condensed consolidated balance sheets | â â â â â â â â â December 31, September 30, â â 2019 â 2020 First Lien Term Loan â $ 1,139,188 â $ 1,130,514 First Lien Revolver â â 140,000 â â 130,000 Unamortized debt financing costs â (5,389) â (539) Unamortized discount â (800) â â Total â $ 1,272,999 â $ 1,259,975 |
EQUITY (Tables)
EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Schedule of incentive units granted | â â â â â â â â â Weighted Average â â Incentive Units â Hurdle Price OutstandingâJanuary 1, 2020 19,754,450 â $ 21.59 Granted 30,000 â â 30.48 Exchanged â (2,904,221) â â 11.80 Forfeited (221,651) â â 24.67 OutstandingâSeptember 30, 2020 16,658,578 â 23.28 VestedâSeptember 30, 2020 7,334,000 â 16.81 |
Schedule of incentive units outstanding and vested by hurdle rates | â â â â â â â Number Vested Hurdle Rates â Outstanding â Units $1.42 421 â 421 5.50 798 â 798 6.00 386 â 386 7.00 1,081 â 1,081 9.00 1,323,708 â 1,323,708 11.00 841,706 â 841,706 12.00 520,000 â 520,000 13.00 579,213 â 579,213 14.00 17,848 â 17,848 16.00 48,054 â 48,054 17.00 22,500 â 22,500 19.00 635,964 â 635,964 21.00 3,608,442 â 2,108,442 22.00 1,112,903 â 518,696 23.00 524,828 â 262,414 26.26 â 25,000 â â 27.00 29,484 â 14,742 27.90 â 2,051,131 â â 28.50 â 1,585,111 â 388,027 30.48 â 30,000 â â 33.00 3,670,000 â 40,000 36.64 â 30,000 â 10,000 â â 16,658,578 â 7,334,000 |
Stock options | |
Schedule of stock options granted | â â â â â â â â Stock Weighted Average â â Options â Exercise Price OutstandingâJanuary 1, 2020 1,832,966 â $ 30.42 Granted â â â â â Exercised â (49,685) â â 31.40 Forfeited â (21,817) â â 29.27 OutstandingâSeptember 30, 2020 â 1,761,464 â â 30.40 VestedâSeptember 30, 2020 â 669,441 â â 32.06 |
Restricted Stock Units (RSUs) | |
Schedule of changes in restricted stock units | â â â â â â â â â â â Weighted â â â â Average â â Restricted Stock â Grant Date â Units Fair Value OutstandingâJanuary 1, 2020 98,061 â $ 27.90 Granted â â â â â Forfeited â (7,707) â â 27.90 Vested â â â â â OutstandingâSeptember 30, 2020 â 90,354 â â 27.90 |
Class A common stock | |
Schedule of unvested stock | â â â â â â â â â â â Weighted â â â â Average â â Unvested Class A â Grant Date â Common Stock Fair Value OutstandingâJanuary 1, 2020 53,293 â $ 33.00 Forfeited â (834) â â 33.00 Vested â â â â â OutstandingâSeptember 30, 2020 â 52,459 â â 33.00 |
CASH FLOW INFORMATION (Tables)
CASH FLOW INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
CASH FLOW INFORMATION | |
Schedule of supplemental cash flow information | â â â â â â â â â â Nine Months Ended â â September 30, â 2019 2020 Supplemental disclosures of cash flow informationâcash paid for: â â â â â â Interest â $ 41,782 â $ 32,109 Income taxes â $ 5,011 â $ 13,036 Supplemental non-cash cash flow information: â â Fair market value of estimated contingent consideration in connection with acquisitions â $ 70,209 â $ 8,963 Net tangible liabilities acquired in connection with business acquisitions â $ (2,636) â $ (7,599) Discount on proceeds from Credit Facility â $ 875 â $ â Operating lease assets â $ 167,866 â $ 236,822 Operating lease liabilities â $ 183,491 â $ 256,903 |
SUMMARY OF ACCOUNTING POLICIE_3
SUMMARY OF ACCOUNTING POLICIES - Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue Recognition | ||||
Total revenues | $ 331,483 | $ 316,641 | $ 981,646 | $ 878,110 |
Domestic revenue | ||||
Revenue Recognition | ||||
Total revenues | 313,956 | 302,572 | 933,420 | 844,784 |
International revenue | ||||
Revenue Recognition | ||||
Total revenues | $ 17,527 | $ 14,069 | $ 48,226 | $ 33,326 |
NON-CONTROLLING INTEREST AND _2
NON-CONTROLLING INTEREST AND INCOME (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Net income (loss) attributable to common stockholders | |||||
Net income (loss) | $ 3,944 | $ 392 | $ 41,291 | $ 666 | |
Non-controlling interest | (2,302) | 881 | (16,844) | (1,539) | |
Net income (loss) attributable to common shareholders | 1,642 | 1,273 | 24,447 | (873) | |
Basic income (loss) per share: | |||||
Net income (loss) attributable to common shareholders | 24,447 | (873) | |||
Diluted income (loss) per share: | |||||
Net income (loss) attributable to common shareholders | 24,447 | (873) | |||
Class A common stock | |||||
Basic income (loss) per share: | |||||
Net income (loss) attributable to common shareholders | $ 1,642 | $ 1,273 | $ 24,447 | $ (873) | |
Weighted average shares of Class A common stock outstanding | 48,683,580 | 47,044,507 | 47,991,831 | 46,653,820 | |
Basic income (loss) per share | $ 0.03 | $ 0.03 | $ 0.51 | $ (0.02) | |
Diluted income (loss) per share: | |||||
Net income (loss) attributable to common shareholders | $ 1,642 | $ 1,273 | $ 24,447 | $ (873) | |
Total | $ 1,642 | $ 1,273 | $ 24,447 | $ (873) | |
Weighted average shares of Class A common stock outstanding | 48,683,580 | 47,044,507 | 47,991,831 | 46,653,820 | |
Effect of dilutive stock options | 60,974 | 21,728 | |||
Effect of dilutive unvested Class A common stock and restricted stock units | 65,774 | 14,106 | 26,455 | ||
Total | 48,810,328 | 47,058,613 | 48,040,014 | 46,653,820 | |
Diluted income (loss) per share | $ 0.03 | $ 0.03 | $ 0.51 | $ (0.02) | |
Antidilutive shares | 15,773 | ||||
Market based stock options | |||||
Diluted income (loss) per share: | |||||
Antidilutive shares | 155,000 | 155,000 | |||
Threshold period | 90 days | ||||
Vesting period | 5 years | ||||
Market based stock options | Minimum | |||||
Diluted income (loss) per share: | |||||
Threshold volume weighted average per share price trigger | $ 100 | ||||
Focus LLC | |||||
LOSS PER SHARE | |||||
Focus LLC common units held by continuing owners | 20,895,381 | 20,895,381 | 22,198,665 | ||
Common unit equivalents of outstanding vested and unvested incentive units held by continuing owners | 4,860,295 | 4,860,295 | 4,006,594 | ||
Total common units and common unit equivalents attributable to non-controlling interest | 25,755,676 | 25,755,676 | 26,205,259 | ||
Total common units and common unit equivalents of incentive units outstanding | 76,350,048 | 76,350,048 | 73,461,166 | ||
Non-controlling interest allocation | 33.70% | 33.70% | 35.70% | ||
Company's interest in Focus LLC | 66.30% | 66.30% | 64.30% | ||
Convertible incentive units | 16,658,578 | 17,748,891 | 16,658,578 | 17,748,891 |
ACQUISITIONS - Business Acquisi
ACQUISITIONS - Business Acquisitions (Details) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2020USD ($)item | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Allocation of purchase price: | |||
Goodwill | $ 1,125,604 | $ 1,090,231 | $ 860,495 |
Business acquisitions | |||
ACQUISITIONS | |||
Number of business acquisitions closed | 7 | ||
Consideration: | |||
Cash due at closing | $ 68,726 | ||
Estimated working capital adjustment | (174) | ||
Fair market value of estimated contingent consideration | 8,963 | ||
Total consideration | 77,515 | ||
Allocation of purchase price: | |||
Total tangible assets | 8,001 | ||
Total liabilities assumed | (15,600) | ||
Goodwill | 34,897 | ||
Total allocated consideration | 77,515 | ||
Amount of goodwill and intangibles expected to be deductible for tax purposes | $ 47,931 | ||
Deductibility period for goodwill and intangible assets acquired in a business acquisition (in years) | 15 years | ||
Number of business acquisitions closed during the period which are new subsidiary partner firms | item | 2 | ||
Revenue from acquired entity in business acquisitions | $ 6,996 | ||
Income from acquired entity in business acquisitions | 1,053 | ||
Business acquisitions | Customer relationships | |||
Allocation of purchase price: | |||
Finite-lived intangible assets | 48,450 | ||
Business acquisitions | Management contracts | |||
Allocation of purchase price: | |||
Finite-lived intangible assets | 1,564 | ||
Business acquisitions | Other intangibles | |||
Allocation of purchase price: | |||
Finite-lived intangible assets | $ 203 |
ACQUISITIONS - Asset Acquisitio
ACQUISITIONS - Asset Acquisitions (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Dec. 31, 2020USD ($)item | Sep. 30, 2020USD ($)item | |
Asset Acquisitions | ||
Weighted-average useful life of all intangibles acquired | 9 years | |
Business acquisitions | ||
Asset Acquisitions | ||
Number of asset acquisitions | item | 3 | |
Total purchase consideration in cash | $ 750 | |
Number of business acquisitions | 7 | |
Purchase consideration for asset acquisitions | $ 68,726 | |
Business acquisitions | Subsequent Events | ||
Asset Acquisitions | ||
Number of business acquisitions | item | 4 | |
Purchase consideration for asset acquisitions | $ 51,447 | |
Management contracts | ||
Asset Acquisitions | ||
Weighted-average useful life of all intangibles acquired | 16 years | |
Customer relationships | ||
Asset Acquisitions | ||
Weighted-average useful life of all intangibles acquired | 8 years | |
Other intangibles | ||
Asset Acquisitions | ||
Weighted-average useful life of all intangibles acquired | 5 years |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Change in goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Change in the goodwill | ||
Goodwill beginning of period | $ 1,112,855 | $ 883,119 |
Cumulative impairment losses beginning of period | (22,624) | (22,624) |
Balance beginning of period | 1,090,231 | 860,495 |
Goodwill acquired | 34,897 | 229,799 |
Other | 476 | (63) |
Goodwill period increase (decrease) | 35,373 | 229,736 |
Goodwill end of period | 1,148,228 | 1,112,855 |
Cumulative impairment losses end of period | (22,624) | (22,624) |
Balance end of period | $ 1,125,604 | $ 1,090,231 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS- Intangible assets (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Amortizing acquired intangible assets | ||
Gross Carry Amount | $ 1,570,580 | $ 1,517,725 |
Accumulated Amortization | (622,853) | (514,269) |
Net Book Value | 947,727 | 1,003,456 |
Customer relationships | ||
Amortizing acquired intangible assets | ||
Gross Carry Amount | 1,413,086 | 1,362,104 |
Accumulated Amortization | (573,433) | (471,361) |
Net Book Value | 839,653 | 890,743 |
Management contracts | ||
Amortizing acquired intangible assets | ||
Gross Carry Amount | 152,006 | 150,464 |
Accumulated Amortization | (45,785) | (39,888) |
Net Book Value | 106,221 | 110,576 |
Other intangibles | ||
Amortizing acquired intangible assets | ||
Gross Carry Amount | 5,488 | 5,157 |
Accumulated Amortization | (3,635) | (3,020) |
Net Book Value | $ 1,853 | $ 2,137 |
FAIR VALUE MEASUREMENTS - Impli
FAIR VALUE MEASUREMENTS - Implied fair value (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Implied fair value based on level 2 inputs | ||
Stated value | $ 1,259,975 | $ 1,272,999 |
First Lien Term Loan | ||
Implied fair value based on level 2 inputs | ||
Stated value | 1,130,514 | 1,139,188 |
Fair value | $ 1,095,185 | $ 1,146,307 |
FAIR VALUE MEASUREMENTS - Chang
FAIR VALUE MEASUREMENTS - Changes in the fair value (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Mar. 31, 2020 | |
Changes in the fair value of estimated contingent consideration for business acquisitions | ||||
Balance at beginning of period | $ 183,568 | $ 98,905 | $ 98,905 | |
Additions to estimated contingent consideration | 8,963 | 82,781 | ||
Payments of contingent consideration | (73,588) | (36,862) | ||
Non-cash changes in fair value of estimated contingent consideration | (621) | 38,797 | ||
Other | (219) | (53) | ||
Balance at end of period | 118,103 | 183,568 | ||
Contingent consideration paid in cash | 1,961 | $ 2,537 | ||
Interest rate swap | ||||
Changes in the fair value of estimated contingent consideration for business acquisitions | ||||
Notional amount | 850,000 | $ 400,000 | ||
Business acquisitions | ||||
Changes in the fair value of estimated contingent consideration for business acquisitions | ||||
Contingent consideration paid in cash | 73,588 | |||
Other liabilities | Interest rate swap | ||||
Changes in the fair value of estimated contingent consideration for business acquisitions | ||||
Fair value of interest rate swap | $ (11,337) | |||
Other liabilities | Business acquisitions | ||||
Changes in the fair value of estimated contingent consideration for business acquisitions | ||||
Contingent consideration paid in cash | $ 36,862 |
FAIR VALUE MEASUREMENTS - Conti
FAIR VALUE MEASUREMENTS - Contingent consideration (Details) - Level 3 $ in Thousands | Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) |
Inputs used in the fair value measurement of estimated contingent consideration | ||
Estimated contingent consideration | $ 118,103 | $ 183,568 |
Minimum | Forecasted growth rates | ||
Inputs used in the fair value measurement of estimated contingent consideration | ||
Estimated contingent consideration (in percent) | (29.5) | (10.7) |
Minimum | Discount Rates | ||
Inputs used in the fair value measurement of estimated contingent consideration | ||
Estimated contingent consideration (in percent) | 6.4 | 11 |
Maximum | Forecasted growth rates | ||
Inputs used in the fair value measurement of estimated contingent consideration | ||
Estimated contingent consideration (in percent) | 57.5 | 51.1 |
Maximum | Discount Rates | ||
Inputs used in the fair value measurement of estimated contingent consideration | ||
Estimated contingent consideration (in percent) | 18 | 17 |
CREDIT FACILITY - Old and New C
CREDIT FACILITY - Old and New Credit Facility (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
Credit Facility | |||
Face amount of debt | $ 1,260,514 | $ 1,279,188 | |
Debt issuance costs | 634 | $ 3,743 | |
Loss on extinguishment of borrowings | (6,094) | ||
Contingent Principal Payments | 0 | ||
Contingent principal payments due in current year | 0 | ||
Deferred financing costs | $ 7,623 | $ 9,645 | |
Credit Facility | |||
Credit Facility | |||
Actual total secured leverage ratio | 3.67 | ||
Consolidated EBITDA | $ 332,317 | ||
Secured leverage ratio threshold for contingent principal payments | 3.75 | ||
Credit Facility | Maximum | |||
Credit Facility | |||
Actual total secured leverage ratio | 6.25 | ||
First Lien Term Loan | |||
Credit Facility | |||
Face amount of debt | $ 1,153,000 | ||
Quarterly installment repayments | 2,891 | ||
Debt issuance costs | 634 | ||
Loss on extinguishment of borrowings | 6,094 | ||
Write-off of debt issuance cost | 5,306 | ||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net, Total | $ 788 | ||
First Lien Term Loan | LIBOR | |||
Credit Facility | |||
Margin (as a percent) | 2.00% | ||
First Lien Term Loan | Base rate | |||
Credit Facility | |||
Margin (as a percent) | 1.00% | ||
First Lien Revolver | |||
Credit Facility | |||
Accordion feature | $ 650,000 | ||
Maximum borrowing capacity | $ 30,000 | ||
Unused commitment fee (as a percent) | 0.50% | ||
Deferred financing costs | $ 7,623 | $ 9,645 | |
First Lien Revolver | LIBOR | |||
Credit Facility | |||
Margin (as a percent) | 2.00% | ||
First Lien Revolver | Base rate | |||
Credit Facility | |||
Margin (as a percent) | 1.00% | ||
First Lien Revolver Step Down One | |||
Credit Facility | |||
Unused commitment fee (as a percent) | 0.375% | ||
First Lien Revolver Step Down One | LIBOR | |||
Credit Facility | |||
Margin (as a percent) | 1.75% | ||
First Lien Revolver Step Down One | Base rate | |||
Credit Facility | |||
Margin (as a percent) | 0.75% | ||
First Lien Revolver Step Down Two | |||
Credit Facility | |||
Unused commitment fee (as a percent) | 0.25% | ||
First Lien Revolver Step Down Two | LIBOR | |||
Credit Facility | |||
Margin (as a percent) | 1.50% | ||
First Lien Revolver Step Down Two | Base rate | |||
Credit Facility | |||
Margin (as a percent) | 0.50% | ||
First Lien Revolver Step Down Three | LIBOR | |||
Credit Facility | |||
Margin (as a percent) | 1.25% | ||
First Lien Revolver Step Down Three | Base rate | |||
Credit Facility | |||
Margin (as a percent) | 0.25% |
CREDIT FACILITY - Reconciliatio
CREDIT FACILITY - Reconciliation of Principal Amounts Outstanding (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Credit Facility | ||
Unamortized debt financing costs | $ (539) | $ (5,389) |
Unamortized discount | (800) | |
Amount outstanding under credit facility | 1,259,975 | 1,272,999 |
First Lien Term Loan | ||
Credit Facility | ||
Amount outstanding under credit facility | 1,130,514 | 1,139,188 |
First Lien Revolver | ||
Credit Facility | ||
Amount outstanding under credit facility | $ 130,000 | $ 140,000 |
CREDIT FACILITY - First Lien Re
CREDIT FACILITY - First Lien Revolver and Letters of Credit (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Sep. 30, 2020 | |
Credit Facility | ||
Weighted average interest rate | 5.00% | 3.00% |
First Lien Revolver | ||
Credit Facility | ||
Unused commitment line | $ 502,962 | $ 512,266 |
Letter of credit | ||
Credit Facility | ||
Letter of credit outstanding | $ 7,038 | $ 7,734 |
Annual interest rate | 2.00% |
DERIVATIVES (Details)
DERIVATIVES (Details) $ in Thousands | 1 Months Ended | ||
Apr. 30, 2020USD ($)agreement | Mar. 31, 2020USD ($) | Sep. 30, 2020USD ($) | |
Interest rate swap | |||
Derivatives | |||
Number of interest rate swap agreements | agreement | 2 | ||
Term of contract | 4 years | 4 years | |
Notional amount | $ 400,000 | $ 850,000 | |
Outstanding debt | $ 450,000 | $ 400,000 | |
Interest received from counterparty (as a percent) | 0.00% | ||
Floating to fixed interest rate swap one | |||
Derivatives | |||
Notional amount | $ 250,000 | ||
Interest payable to counterparty (as a percent) | 0.537% | ||
Floating to fixed interest rate swap two | |||
Derivatives | |||
Notional amount | $ 200,000 | ||
Interest payable to counterparty (as a percent) | 0.5315% | ||
Other liabilities | Interest rate swap | |||
Derivatives | |||
Fair value of interest rate swap | (11,337) | ||
Offsetting adjustment in fair value in AOCI net of tax | $ 2,029 | ||
LIBOR | Floor | |||
Derivatives | |||
Interest received from counterparty (as a percent) | 0.00% | ||
LIBOR | Interest rate swap | |||
Derivatives | |||
Interest payable to counterparty (as a percent) | 0.713% |
EQUITY (Details)
EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Class A common stock | |||||||
EQUITY | |||||||
Issuance of common stock (in shares) | 2,458,858 | 282,347 | 383,001 | ||||
Class B common stock | |||||||
EQUITY | |||||||
Common stock retired (in shares) | 600,722 | 316,370 | |||||
Inventive units retired (in shares) | 263,276 | ||||||
Incentive Units | |||||||
EQUITY | |||||||
Inventive units retired (in shares) | 2,706,350 | 35,000 | 162,871 | ||||
Common units acquired (in shares) | 2,458,858 | 282,347 | 383,001 | ||||
Fair value of the stock option grants determined with assumptions | |||||||
Compensation expense recognized | $ 3,926 | $ 3,265 | $ 11,678 | $ 10,304 | |||
Stock options | Class A common stock | |||||||
Fair value of the stock option grants determined with assumptions | |||||||
Compensation expense recognized | $ 1,380 | $ 1,011 | $ 3,910 | $ 3,071 | |||
Restricted Stock Units (RSUs) | |||||||
Changes in unvested common stock | |||||||
Outstanding at the beginning of the period | 98,061 | ||||||
Forfeited | (7,707) | ||||||
Outstanding at the end of the period | 90,354 | 90,354 | 90,354 | ||||
Changes in unvested common stock, Grant Date Fair Value | |||||||
Outstanding at the beginning of the period | $ 27.90 | ||||||
Forfeited | 27.90 | ||||||
Outstanding at the end of the period | $ 27.90 | $ 27.90 | $ 27.90 | ||||
Common Stock | Class A common stock | |||||||
Changes in unvested common stock | |||||||
Outstanding at the beginning of the period | 53,293 | ||||||
Forfeited | (834) | ||||||
Outstanding at the end of the period | 52,459 | 52,459 | 52,459 | ||||
Changes in unvested common stock, Grant Date Fair Value | |||||||
Outstanding at the beginning of the period | $ 33 | ||||||
Forfeited | 33 | ||||||
Outstanding at the end of the period | $ 33 | $ 33 | $ 33 | ||||
Common Stock | Stock options | |||||||
Changes in stock options | |||||||
Outstanding at the beginning of the period | 1,832,966 | ||||||
Exercised | (49,685) | ||||||
Forfeited | (21,817) | ||||||
Outstanding at the end of the period | 1,761,464 | 1,761,464 | 1,761,464 | ||||
Vested | 669,441 | ||||||
Changes in stock option, Weighted Average Exercise Price | |||||||
Outstanding at the beginning of the period | $ 30.42 | ||||||
Exercised | 31.40 | ||||||
Forfeited | 29.27 | ||||||
Outstanding at the end of the period | $ 30.40 | $ 30.40 | 30.40 | ||||
Vested | $ 32.06 | ||||||
Changes in unvested common stock | |||||||
Vested | (669,441) | ||||||
Changes in unvested common stock, Grant Date Fair Value | |||||||
Vested | $ 32.06 |
EQUITY - Focus LLC Incentive Un
EQUITY - Focus LLC Incentive Unit (Details) - Incentive Units - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Incentive Units | ||||
Outstanding at the beginning of the period | 19,754,450 | |||
Granted | 30,000 | |||
Exchanged | 2,904,221 | |||
Forfeited | (221,651) | |||
Outstanding at the end of the period | 16,658,578 | 16,658,578 | ||
Vested at the end of the period | 7,334,000 | |||
Weighted Average Hurdle Price | ||||
Outstanding at the beginning of the period | $ 21.59 | |||
Granted | 30.48 | |||
Exchanged | 11.80 | |||
Forfeited | 24.67 | |||
Outstanding at the end of the period | $ 23.28 | 23.28 | ||
Vested at the end of the period | $ 16.81 | $ 16.81 | ||
Non-cash equity compensation expense | $ 3,926 | $ 3,265 | $ 11,678 | $ 10,304 |
Hurdle Rate $1.42 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 421 | 421 | ||
Vested at the end of the period | 421 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 1.42 | |||
Hurdle Rate 5.50 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 798 | 798 | ||
Vested at the end of the period | 798 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 5.50 | |||
Hurdle Rate 6.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 386 | 386 | ||
Vested at the end of the period | 386 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 6 | |||
Hurdle Rate 7.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 1,081 | 1,081 | ||
Vested at the end of the period | 1,081 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 7 | |||
Hurdle Rate 9.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 1,323,708 | 1,323,708 | ||
Vested at the end of the period | 1,323,708 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 9 | |||
Hurdle Rate 11.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 841,706 | 841,706 | ||
Vested at the end of the period | 841,706 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 11 | |||
Hurdle Rate 12.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 520,000 | 520,000 | ||
Vested at the end of the period | 520,000 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 12 | |||
Hurdle Rate 13.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 579,213 | 579,213 | ||
Vested at the end of the period | 579,213 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 13 | |||
Hurdle Rate 14.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 17,848 | 17,848 | ||
Vested at the end of the period | 17,848 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 14 | |||
Hurdle Rate 16.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 48,054 | 48,054 | ||
Vested at the end of the period | 48,054 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 16 | |||
Hurdle Rate 17.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 22,500 | 22,500 | ||
Vested at the end of the period | 22,500 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 17 | |||
Hurdle Rate 19.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 635,964 | 635,964 | ||
Vested at the end of the period | 635,964 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 19 | |||
Hurdle Rate 21.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 3,608,442 | 3,608,442 | ||
Vested at the end of the period | 2,108,442 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 21 | |||
Hurdle Rate 22.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 1,112,903 | 1,112,903 | ||
Vested at the end of the period | 518,696 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 22 | |||
Hurdle Rate 23.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 524,828 | 524,828 | ||
Vested at the end of the period | 262,414 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 23 | |||
Hurdle Rate 26.26 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 25,000 | 25,000 | ||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 26.26 | |||
Hurdle Rate 27.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 29,484 | 29,484 | ||
Vested at the end of the period | 14,742 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 27 | |||
Hurdle Rate 27.90 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 2,051,131 | 2,051,131 | ||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 27.90 | |||
Hurdle Rate 28.50 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 1,585,111 | 1,585,111 | ||
Vested at the end of the period | 388,027 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 28.50 | |||
Hurdle Rate 30.48 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 30,000 | 30,000 | ||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 30.48 | |||
Hurdle Rate 33.00 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 3,670,000 | 3,670,000 | ||
Vested at the end of the period | 40,000 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 33 | |||
Hurdle Rate 36.64 | ||||
Incentive Units | ||||
Outstanding at the end of the period | 30,000 | 30,000 | ||
Vested at the end of the period | 10,000 | |||
Weighted Average Hurdle Price | ||||
Hurdle Rates | $ 36.64 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
INCOME TAXES | ||
Effective income tax rate (as a percent) | 25.80% | (141.70%) |
Income tax expense related to newly issued regulations | $ 1,599 | |
Uncertain tax positions reserve | $ 0 |
TAX RECEIVABLE AGREEMENTS (Deta
TAX RECEIVABLE AGREEMENTS (Details) $ in Thousands | Jul. 30, 2018agreement | Mar. 31, 2020agreement | Sep. 30, 2020USD ($) |
TAX RECEIVABLE AGREEMENTS | |||
Number of tax receivable agreements | agreement | 2 | 3 | |
Payment to TRA holder on net cash savings (as a percent) | 85.00% | ||
Retained benefit on net cash savings (as a percent) | 15.00% | ||
TRA obligations | $ | $ 78,124 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
COMMITMENTS AND CONTINGENCIES | ||
Liabilities, clearing brokers | $ 0 | $ 0 |
CASH FLOW INFORMATION (Details)
CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Supplemental disclosures of cash flow information-cash paid for: | ||
Interest | $ 32,109 | $ 41,782 |
Income taxes | 13,036 | 5,011 |
Supplemental non-cash cash flow information: | ||
Fair market value of estimated contingent consideration in connection with acquisitions | 8,963 | 70,209 |
Net tangible assets (liabilities) acquired in connection with business acquisitions | (7,599) | (2,636) |
Discount on proceeds from Credit Facility | 875 | |
Operating lease assets | 236,822 | 167,866 |
Operating lease liabilities | $ 256,903 | $ 183,491 |
RELATED PARTIES (Details)
RELATED PARTIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
RELATED PARTIES | ||||
Expenses recognized | $ 267 | $ 498 | $ 719 | $ 1,568 |
OTHER (Details)
OTHER (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
OTHER | |
Management contract buyout expense | $ 1,428 |