Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 07, 2018 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | NCS Multistage Holdings, Inc. | |
Entity Central Index Key | 1,692,427 | |
Trading Symbol | ncsm | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding (in shares) | 44,908,920 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 33,477 | $ 33,809 |
Accounts receivable - trade, net | 40,394 | 47,880 |
Inventories | 30,991 | 33,135 |
Prepaid expenses and other current assets | 3,637 | 1,616 |
Other current receivables | 5,983 | 1,369 |
Total current assets | 114,482 | 117,809 |
Noncurrent assets | ||
Property and equipment, net | 25,691 | 23,651 |
Goodwill | 179,519 | 184,478 |
Identifiable intangibles, net | 126,876 | 136,412 |
Deposits and other assets | 1,416 | 1,563 |
Total noncurrent assets | 333,502 | 346,104 |
Total assets | 447,984 | 463,913 |
Current liabilities | ||
Accounts payable—trade | 8,320 | 7,448 |
Accrued expenses | 5,292 | 6,673 |
Income taxes payable | 129 | 10,561 |
Current contingent consideration | 11,695 | |
Other current liabilities | 2,361 | 1,673 |
Current maturities of long-term debt | 2,801 | 5,334 |
Total current liabilities | 30,598 | 31,689 |
Noncurrent liabilities | ||
Long-term debt, less current maturities | 22,240 | 21,702 |
Noncurrent contingent consideration | 12,835 | |
Other long-term liabilities | 1,224 | 4,513 |
Deferred income taxes, net | 20,427 | 24,183 |
Total noncurrent liabilities | 43,891 | 63,233 |
Total liabilities | 74,489 | 94,922 |
Commitments and contingencies (Note 9) | ||
Stockholders' Equity | ||
Preferred stock, $0.01 par value, 10,000,000 shares authorized, one share issued and outstanding at June 30, 2018 and December 31, 2017, respectively | ||
Common stock, $0.01 par value, 225,000,000 shares authorized, 44,926,665 shares issued and 44,908,317 shares outstanding at June 30, 2018 and 43,931,484 shares issued and 43,913,136 shares outstanding at December 31, 2017 | 449 | 439 |
Additional paid-in capital | 405,550 | 399,426 |
Accumulated other comprehensive loss | (77,631) | (66,707) |
Retained earnings | 31,036 | 23,864 |
Treasury stock, at cost; 18,348 shares at June 30, 2018 and at December 31, 2017 | (175) | (175) |
Total stockholders’ equity | 359,229 | 356,847 |
Non-controlling interest | 14,266 | 12,144 |
Total equity | 373,495 | 368,991 |
Total liabilities and stockholders' equity | $ 447,984 | $ 463,913 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Jun. 30, 2018 | Dec. 31, 2017 |
CONDENSED CONSOLIDATED BALANCE SHEETS [Abstract] | ||
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 1 | 1 |
Preferred stock, shares outstanding (in shares) | 1 | 1 |
Common stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 225,000,000 | 225,000,000 |
Common stock, shares issued (in shares) | 44,926,665 | 43,931,484 |
Common stock, shares outstanding (in shares) | 44,908,317 | 43,913,136 |
Treasury stock, shares (in shares) | 18,348 | 18,348 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues | ||||
Revenues | $ 43,398 | $ 36,857 | $ 114,084 | $ 95,493 |
Cost of sales | ||||
Cost of product sales, exclusive of depreciation and amortization expense shown below | 12,622 | 15,733 | 37,325 | 40,448 |
Cost of services, exclusive of depreciation and amortization expense shown below | 7,290 | 3,152 | 16,179 | 7,791 |
Total cost of sales, exclusive of depreciation and amortization expense shown below | 19,912 | 18,885 | 53,504 | 48,239 |
Selling, general and administrative expenses | 22,125 | 16,163 | 43,152 | 28,935 |
Depreciation | 1,156 | 678 | 2,255 | 1,242 |
Amortization | 3,283 | 5,973 | 6,604 | 11,995 |
Change in fair value of contingent consideration | 213 | 767 | (1,140) | 767 |
(Loss) income from operations | (3,291) | (5,609) | 9,709 | 4,315 |
Other income (expense) | ||||
Interest expense, net | (608) | (2,007) | (1,065) | (3,516) |
Other (expense) income, net | (44) | 64 | 40 | 1,038 |
Foreign currency exchange gain | 106 | 1,952 | 289 | 1,011 |
Total other (expense) income | (546) | 9 | (736) | (1,467) |
(Loss) income before income tax | (3,837) | (5,600) | 8,973 | 2,848 |
Income tax (benefit) expense | (1,019) | (855) | (74) | 1,245 |
Net (loss) income | (2,818) | (4,745) | 9,047 | 1,603 |
Net income (loss) attributable to non-controlling interest | 1,235 | (254) | 2,122 | (456) |
Net (loss) income attributable to NCS Multistage Holdings, Inc. | $ (4,053) | $ (4,491) | $ 6,925 | $ 2,059 |
(Loss) earnings per common share | ||||
Basic (loss) earnings per common share attributable to NCS Multistage Holdings, Inc. (in dollars per share) | $ (0.09) | $ (0.11) | $ 0.15 | $ 0.05 |
Diluted (loss) earnings per common share attributable to NCS Multistage Holdings, Inc. (in dollars per share) | $ (0.09) | $ (0.11) | $ 0.15 | $ 0.05 |
Weighted average common shares outstanding | ||||
Basic | 44,778,000 | 40,198,000 | 44,517,000 | 37,119,000 |
Diluted | 44,778,000 | 40,198,000 | 47,186,000 | 40,188,000 |
Product sales [Member] | ||||
Revenues | ||||
Revenues | $ 27,773 | $ 29,397 | $ 77,881 | $ 74,971 |
Services [Member] | ||||
Revenues | ||||
Revenues | $ 15,625 | $ 7,460 | $ 36,203 | $ 20,522 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract] | ||||
Net (loss) income | $ (2,818) | $ (4,745) | $ 9,047 | $ 1,603 |
Foreign currency translation adjustments, net of tax of $0 | (4,235) | 5,940 | (10,924) | 7,593 |
Comprehensive (loss) income | (7,053) | 1,195 | (1,877) | 9,196 |
Less: Comprehensive income (loss) attributable to non-controlling interest | 1,235 | (277) | 2,122 | (456) |
Comprehensive (loss) income attributable to NCS Multistage Holdings, Inc. | $ (8,288) | $ 1,472 | $ (3,999) | $ 9,652 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract] | ||||
Foreign currency translation adjustments, tax | $ 0 | $ 0 | $ 0 | $ 0 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Other Comprehensive (Loss) Income [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Non-controlling Interest [Member] | Total |
Beginning balance at Dec. 31, 2016 | $ 340 | $ 237,566 | $ (82,015) | $ 21,762 | $ (175) | $ 177,478 | ||
Beginning balance, shares at Dec. 31, 2016 | 1 | 34,024,326 | 18,348 | |||||
Acquisition | $ 12,954 | 12,954 | ||||||
Share-based compensation | 1,836 | 1,836 | ||||||
Net (loss) income | 2,059 | (456) | 1,603 | |||||
Issuance of common stock upon IPO, net of offering costs | $ 96 | 148,841 | 148,937 | |||||
Issuance of common stock upon IPO, net of offering costs, shares | 9,550,000 | |||||||
Currency translation adjustment | 7,593 | 7,593 | ||||||
Ending balance at Jun. 30, 2017 | $ 436 | 388,243 | (74,422) | 23,821 | $ (175) | 12,498 | 350,401 | |
Ending balance, shares at Jun. 30, 2017 | 1 | 43,574,326 | 18,348 | |||||
Beginning balance at Dec. 31, 2017 | $ 439 | 399,426 | (66,707) | 23,864 | $ (175) | 12,144 | 368,991 | |
Beginning balance, shares at Dec. 31, 2017 | 1 | 43,931,484 | 18,348 | |||||
Adoption of ASC 606 at Dec. 31, 2017 | 247 | 247 | ||||||
Share-based compensation | 5,332 | 5,332 | ||||||
Net (loss) income | 6,925 | 2,122 | 9,047 | |||||
Exercise of stock options | $ 6 | 796 | 802 | |||||
Exercise of stock options, shares | 552,869 | |||||||
Cemblend exchangeable shares | $ 4 | (4) | ||||||
Cemblend exchangeable shares, shares | 442,312 | |||||||
Currency translation adjustment | (10,924) | (10,924) | ||||||
Ending balance at Jun. 30, 2018 | $ 449 | $ 405,550 | $ (77,631) | $ 31,036 | $ (175) | $ 14,266 | $ 373,495 | |
Ending balance, shares at Jun. 30, 2018 | 1 | 44,926,665 | 18,348 |
CONDENSED CONSOLIDATED STATEME8
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities | ||
Net income | $ 9,047 | $ 1,603 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 8,859 | 13,237 |
Amortization of deferred loan cost | 168 | 289 |
Share-based compensation | 5,332 | 1,836 |
Provision for inventory obsolescence | 858 | |
Deferred income tax benefit | (2,185) | (8,577) |
Gain on sale of property and equipment | (16) | (44) |
Foreign exchange gain on financing item | (1,780) | |
Write-off of deferred loan costs | 1,422 | |
Change in fair value of contingent consideration | (1,140) | 767 |
Changes in operating assets and liabilities: | ||
Accounts receivable—trade | 6,753 | (3,598) |
Inventories | 391 | (4,866) |
Prepaid expenses and other assets | (2,066) | (601) |
Accounts payable—trade | 1,587 | 60 |
Accrued expenses | (1,284) | 1,407 |
Other liabilities | 284 | (679) |
Income taxes receivable/payable | (19,093) | 6,564 |
Net cash provided by operating activities | 7,495 | 7,040 |
Cash flows from investing activities | ||
Purchases of property and equipment | (3,068) | (3,873) |
Purchase and development of software and technology | (714) | |
Proceeds from sales of property and equipment | 232 | 137 |
Proceeds from short-term note receivable | 1,000 | |
Acquisition of business, net of cash acquired | (5,996) | |
Net cash used in investing activities | (3,550) | (8,732) |
Cash flows from financing activities | ||
Equipment note borrowings | 1,533 | |
Payments on equipment note and capital leases | (846) | (80) |
Promissory note borrowings | 4,884 | 2,955 |
Payments on promissory note | (7,749) | (1,216) |
Payment of deferred loan cost related to senior secured credit facility | (683) | |
Payments related to public offering | (2,178) | |
Proceeds from related party note receivable | 752 | |
Repayment of term note | (89,077) | |
Proceeds from issuance of common stock, net of offering costs | 151,356 | |
Proceeds from the exercise of options for common stock | 802 | |
Net cash (used in) provided by financing activities | (2,909) | 63,362 |
Effect of exchange rate changes on cash and cash equivalents | (1,368) | 46 |
Net change in cash and cash equivalents | (332) | 61,716 |
Cash and cash equivalents beginning of period | 33,809 | 18,275 |
Cash and cash equivalents end of period | 33,477 | 79,991 |
Supplemental cash flow information | ||
Cash paid for income taxes (net of refunds) | 20,830 | 3,297 |
Noncash investing and financing activities | ||
Assets obtained by entering into capital leases | $ 1,831 | $ 43 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | Note 1. Basis of Presentation Nature of Business NCS Multistage Holdings, Inc., through its wholly owned subsidiaries and subsidiaries for which we have a controlling voting interest (collectively referred to as the “Company,” “NCS,” “we” or “us”), is primarily engaged in providing engineered products and support services for oil and natural gas well completions and field development strategies. We offer our products and services primarily to exploration and production companies for use in onshore wells. We operate through service facilities principally located in Houston, Midland and Corpus Christi, Texas; Tulsa and Oklahoma City, Oklahoma; and Calgary, Red Deer, Grande Prairie and Estevan, Canada. Basis of Presentation Our accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), issued by the Securities Exchange Commission (“SEC”) and have not been audited by our independent registered public accounting firm. The Condensed Consolidated Balance Sheet at December 31, 2017 is derived from our audited financial statements. However, certain information and footnote disclosures required by GAAP for complete annual financial statements have been omitted or condensed as permitted by the rules and regulations of the SEC, and, therefore, these interim financial statements should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K filed with the SEC on March 9, 2018. In the opinion of management, these condensed consolidated financial statements, which have been prepared pursuant to the rules of the SEC and GAAP for interim financial reporting, reflect all adjustments, which consisted only of normal recurring adjustments that were necessary for a fair statement of the interim periods presented. The results of operations for interim periods are not necessarily indicative of those for a full year. All intercompany accounts and transactions have been eliminated for purposes of preparing these condensed consolidated financial statements. Summary of New Significant Accounting Policy Intangible Assets Certain costs incurred in the development of internal-use software applications are capitalized and costs incurred outside of the software application development stage are expensed as incurred. The amounts capitalized are included in intangibles, categorized as internally developed software, and will be amortized on a straight-line basis over the estimated useful life of the software, which is five years . We will begin to amortize internal-use software when it is ready for its intended use. Recent Accounting Pronouncements Pronouncements Adopted in 2018 In June 2018, the Financial Accounting Standards Board (“ FASB”) issued Accounting Standards Update (“ASU”) 2018-07 , Improvements to Nonemployee Share-Based Payment Accounting (Topic 718). The ASU is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. The ASU expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The ASU is for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606, Revenue from Contracts with Customers . We have elected to early adopt this ASU on April 1, 2018. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business (Topic 805) , to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. For public entities, this guidance is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. We adopted ASU 2017-01 on January 1, 2018, which did not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments (Topic 230) . The objective of the guidance is to reduce the existing diversity in practice related to the presentation and classification of certain cash receipts and cash payments. The guidance addresses eight specific cash flow issues including but not limited to, debt prepayment or extinguishment costs, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims and proceeds from the settlement of corporate-owned life insurance policies. For public entities, the guidance is effective for financial statements issued for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years and is retrospective for all periods presented. Early adoption is permitted including for interim periods. We adopted ASU 2016-15 on January 1, 2018, which did not have a material impact on our condensed consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09 , Revenue from Contracts with Customers (Topic 606) . The new standard is effective for annual reporting periods beginning after December 15, 2017 and early adoption is permitted, however, not before fiscal years beginning after December 15, 2016. Subsequent to ASU 2014-09’s issuance, Topic 606 was amended for FASB updates that changed the effective date as well as addressed certain aspects regarding new revenue standards. The comprehensive new standard will supersede existing revenue recognition guidance and require revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which entities expect to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. The guidance permits the use of either a full retrospective or modified retrospective transition method. On January 1, 2018, we adopted ASU 2014-09 and its related amendments (collectively known as Accounting Standards Codification “ASC 606”), using the modified retrospective method. We have concluded that the adoption of this ASU did not have a material impact on our condensed consolidated financial statements. See “Note 2. Revenue” for the required disclosures related to the impact of adopting this standard. Pronouncements Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which replaces the existing guidance in ASC 840, Leases . Under ASC 842, lessees will need to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. The new lease standard also changes the definition of a lease and requires expanded quantitative and qualitative disclosures for both lessees and lessors. Entities are required to adopt ASC 842 using a modified retrospective transition method. Certain practical expedients can be applied. The new standard is effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted. We plan to adopt ASC 842 effective January 1, 2019 and are currently assessing the impact of the adoption. During the second quarter of 2018, we put in place a team, including a third-party consultant, to evaluate our current lease contracts and analyze contracts that may contain lease components. While we cannot currently estimate the quantitative effect that ASC 842 will have on our condensed consolidated financial statements, the adoption of ASC 842 will increase our asset and liability balances on the condensed consolidated balance sheets due to the required recognition of right-of-use assets and corresponding lease liabilities for most lease obligations that are currently classified as operating leases. |
Revenues
Revenues | 6 Months Ended |
Jun. 30, 2018 | |
Revenues [Abstract] | |
Revenues | Note 2. Revenues On January 1, 2018, we adopted ASC 606 and elected to use the modified retrospective method for all contracts not completed as of the date of adoption. The reported results for 2018 reflect the application of ASC 606 guidance while the reported results for 2017 were prepared under the guidance of ASC 605, Revenue Recognition . In accordance with ASC 606, revenue is recognized when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services if certain criteria are met. Financial Statement Impact of Adopting ASC 606 The cumulative effect of the changes made to our condensed consolidated balance sheet at January 1, 2018 for the adoption of ASC 606 using the modified retrospective method was as follows (in thousands): [ Balance at Adjustments December 31, due to Balance at 2017 ASC 606 January 1, 2018 Assets Accounts receivable—trade, net $ 47,880 $ 313 $ 48,193 Liabilities Income taxes payable $ 10,561 $ 66 $ 10,627 Equity Retained earnings $ 23,864 $ 247 $ 24,111 The following tables compare the reported condensed consolidated balance sheet as of June 30, 2018 and statements of operations for the three and six months ended June 30, 2018 , to the balances without the adoption of ASC 606 (in thousands): As of June 30, 2018 Balances Effect of without Adoption Change As Reported of ASC 606 Higher/(Lower) Balance Sheet Assets Accounts receivable—trade, net $ 40,394 $ 40,235 $ 159 Liabilities Income taxes payable $ 129 $ 96 $ 33 Equity Retained earnings $ 31,036 $ 30,910 $ 126 Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Balances Effect of Balances Effect of without Adoption Change without Adoption Change As Reported of ASC 606 Higher/(Lower) As Reported of ASC 606 Higher/(Lower) Income Statement Revenues Services $ 15,625 $ 16,044 $ (419) $ 36,203 $ 36,357 $ (154) Costs and expenses Income tax (benefit) expense $ (1,019) $ (931) $ (88) $ (74) $ (42) $ (32) Net income $ (2,818) $ (2,487) $ (331) $ 9,047 $ 9,169 $ (122) Net income attributable to NCS Multistage Holdings, Inc. $ (4,053) $ (3,722) $ (331) $ 6,925 $ 7,047 $ (122) Revenue Recognition We derive our revenues primarily from highly engineered products and support services. Revenues are based upon a purchase order, contract or other persuasive evidence of an arrangement with the customer that includes a fixed or determinable price, provided that collectability is reasonably assured, but such arrangements do not generally include right of return or other similar provisions or other significant post-delivery obligations. Sales and value added taxes that we collect concurrent with revenue-producing activities are excluded from revenue. We determine revenue recognition through the following steps: (i) identify the contract, (ii) identify the performance obligations, (iii) determine the transaction price, (iv) allocate the transaction price and (v) satisfy the performance obligation. On occasion, we issue credits to our customers that are related specifically to the performance of our products or the services we provide, with such credits reducing the amount of revenue for that sale or job. Such credits are infrequent, situation-specific and cannot be estimated in advance. The payment terms and conditions in our customer contracts vary. We do not have contracts that contain a significant financing component and do not accept noncash consideration from customers. NCS has elected to recognize shipping and handling costs when the title of the product transfers to the customer. These costs are included in cost of sales in our condensed consolidated statements of operations. Product Sales Revenues For product sale arrangements that are standard inventory products or modified inventory products with an alternative use, revenue is recognized at a point in time when control transfers. Control generally transfers upon shipment, which is also when risk of loss and title transfers. Customers may also request bill and hold arrangements in writing. Once we have completed the bill and hold order, the products are segregated from the rest of inventory in the warehouse. The products are delivered based on the customer instructions and revenue is recognized when control transfers, which is generally when title is transferred to the customer. The transaction price for product sales having a performance obligation is the price per unit times the unit quantity ordered and shipped to the customer or consumed at the well site. Services Revenue For service arrangements that do not have a contract provision with a right to a payment for services up to the date of termination, revenue is recognized when the job has been completed, which usually includes a customer signature or acknowledgement and when there are no additional services or future obligations required by us. The transaction price is determined by the contract unit day rate times the cumulative number of days of service provided upon the completion of the service and upon customer acceptance. For service arrangements that do have a contract provision with a right to payment for services up to the date of termination, revenue is recognized over time using a unit rate (labor and materials) output method that corresponds to the value we would receive upon termination of the contract at a reporting period. In applying the output method at the end of a quarter, we check that there is no material work in progress that is not in the measurement of the output. The transaction price for the period end is determined by the contract unit rate times the cumulative number of units earned up to the reporting period less any revenue recognized in prior periods. Disaggregation of Revenue We sell our products and services primarily in North America and in selected international markets. Revenue by geography is attributed based on the current billing address of the customer. The following table depicts the disaggregation of revenue by geographic region (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2018 United States Product sales $ 16,309 $ 29,886 Services 11,396 19,819 Total United States 27,705 49,705 Canada Product sales 10,740 46,438 Services 3,132 14,609 Total Canada 13,872 61,047 Other Countries Product sales 724 1,557 Services 1,097 1,775 Total Other Countries 1,821 3,332 Total Product sales 27,773 77,881 Services 15,625 36,203 Total $ 43,398 $ 114,084 Contract Balances When the timing of the delivery of products and provision of services is different from the timing of the customer payments, we recognize either a contract asset (performance precedes contractual due date in connection with estimates of variable consideration) or a contract liability (customer payment precedes performance) on our condensed consolidated balance sheet. The following table includes the contract assets and liabilities as of June 30, 2018 and January 1, 2018 (in thousands): Contract Assets Contract Liabilities Current Non-Current Current Non-Current Balance at January 1, 2018 $ — $ — $ 170 $ — Additions — — 301 — Revenue recognized — — (170) — Balance at June 30, 2018 $ — $ — $ 301 $ — Our contract liability as of June 30, 2018 is included in current liabilities on our condensed consolidated balance sheet. Our performance obligations for our product and service revenues are usually satisfied before the customer’s payment although prepayments may occasionally be required for international sales . Contracts with Multiple Performance Obligations Greater than 99% of our product and service revenues are considered a single performance obligation. Our self-service product line, which is less than one percent of our revenue for the three and six months ended June 30, 2018 , is made up of two performance obligations: (i) the delivery of tracer materials to a customer well site and (ii) the creation of diagnostic reports ordered by customers when we do not perform an integrated service. For these contracts, we do not allocate the transaction price as the individual performance obligations are sold at standalone prices in the customer order. The transaction prices for our self-service product line that have two performance obligations are (i) the price per unit times the quantity of tracer materials and (ii) prices charged for diagnostic reports ordered by and delivered to the customer. Practical Expedients and Exemptions We generally expense sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling, general and administrative expenses . We do not disclose the value of unsatisfied performance obligations when the related contract has a duration of one year or less or we recognize revenue equal to what we have the right to invoice when that amount corresponds directly with the value to the customer of our performance to date. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2018 | |
Acquisitions [Abstract] | |
Acquisitions | Note 3. Acquisitions Spectrum Tracer Services On August 31, 2017, we acquired 100% of the equity interests in Spectrum Tracer Services, LLC (“Spectrum”) in exchange for approximately $ 83 million, subject to certain adjustments, which was comprised of (i) approximately $76 million in cash and (ii) 0.4 million shares of our common stock using a fair market value of $19.42 per share. The cash portion was funded with available cash and borrowings under our Senior Secured Credit Facility (as defined below). We believe Spectrum’s tracer diagnostics services offering strengthens our ability to provide our customers with actionable data and analysis to optimize oil and natural gas well completions and field development strategies . The acquisition of Spectrum includes an earn-out provision that could provide up to $12.5 million in additional cash consideration to Spectrum’s former unitholders if Spectrum’s actual gross profit during the earn-out period that commenced on October 1, 2017 and ends on December 31, 2018 is greater than the earn-out threshold. The fair value of the earn-out recognized on the acquisition date was $0.4 million. We estimated the fair value of the earn-out using a risk-neutral option pricing analysis within a Monte Carlo simulation framework . The earn-out is subject to re-measurement each reporting period using Level 3 inputs until it has been paid. Subsequent changes in the fair value of the liability are reflected in our condensed consolidated statements of operations as a change in fair value of contingent consideration. As of June 30, 2018 , the earn-out had a value of $ 2.0 million, which is included in current contingent consideration on the condensed consolidated balance sheet. As of December 31, 2017, the earn-out had a value of $ 3.4 million and is included in noncurrent contingent consideration on the condensed consolidated balance sheet. During the three and six months ended June 30, 2018 , we recognized a change of $ 0.1 million and $(1.4) million, respectively, in the estimated fair value of contingent consideration expense in the condensed consolidated statements of operations related to the change in fair value of the Spectrum earn-out. The cash payment, if any, is expected to be paid during the second quarter of 2019. The following unaudited pro forma summary presents our select financial information as if the acquisition had occurred on January 1, 2016. The below information reflects pro forma adjustments based on available information and certain assumptions we believe are reasonable, including: (i) adjustments related to the depreciation and amortization of the fair value of acquired intangibles and fixed assets, (ii) removal of the historical interest expense of Spectrum as well as the addition of the interest expense of the borrowings under our Senior Secured Credit Facility in connection with the acquisition , (iii) tax effect related to historical U.S. operations and the aforementioned pro forma adjustments, (iv) adjustments related to the number of shares of our common stock outstanding to reflect the 0.4 million shares issued in connection with the acquisition and (v) accounting policy conformity changes. The pro forma condensed combined financial information has been included for comparative purposes and is not necessarily indicative of the results that might have actually occurred had the Spectrum acquisition taken place on January 1, 2016; furthermore, the financial information is not intended to be a projection of future results. The following table summarizes our unaudited selected financial information on a pro forma basis (in thousands, except per share data): Pro Forma (Unaudited) Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 Revenue $ 44,771 $ 108,777 Net (loss) income attributable to NCS Multistage Holdings, Inc. $ (3,846) $ 3,416 Diluted earnings per share $ (0.09) $ 0.08 The purchase price is allocated to the estimated fair value of assets acquired and liabilities assumed as of the acquisition date. Goodwill is calculated as the excess of the consideration transferred over the fair value of the net assets recognized. By combining Spectrum’s tracer diagnostics services offering with our existing portfolio of completions products and services, we believe we have an opportunity to increase our revenue through the cross-selling of tracer diagnostics services to current NCS customers and to sell NCS’s completions products and services to current Spectrum customers. This expected synergy gives rise to goodwill being recorded as part of the purchase price of Spectrum. The assets and liabilities of Spectrum have been measured based on various preliminary estimates using assumptions that we believe are reasonable based on information that is currently available. The purchase price allocation is preliminary and adjustments to provisional amounts may occur as we continue to analyze information. We have recognized $40.2 million of goodwill as a result of the transaction of which approximately $6 million will be non-deductible for tax purposes. Additional changes to the purchase price allocation may result in a corresponding change to goodwill in the period of the change as we are currently evaluating the deferred taxes calculation, however, we do not expect such adjustments to materially change the purchase price allocation. We also incurred acquisition costs of $0.3 million and $0.4 million related to this acquisition during the three and six months ended June 30, 2017 , respectively, which was included in general and administrative expense on our condensed consolidated statements of operations. The following table summarizes the consideration and the assets acquired at the Spectrum closing date (in thousands): Consideration Cash consideration $ 76,485 Equity consideration 6,907 Earn-out liability recognized 352 Total consideration $ 83,744 Preliminary purchase price allocation Cash $ 1,326 Accounts receivable 4,648 Inventories 3,761 Other current assets 480 Property and equipment 4,725 Intangible assets 31,900 Other long-term assets 26 Total identifiable assets acquired 46,866 Accounts payable—trade 454 Accrued expenses 436 Income taxes payable 228 Other current liabilities 44 Deferred tax liability 956 Other long-term liabilities 1,191 Total liabilities assumed 3,309 Net identifiable assets acquired 43,557 Goodwill 40,187 Net assets acquired $ 83,744 The amount allocated to intangible assets was attributed to the following categories (in thousands): Estimated Useful Fair Value Lives (Years) Technology $ 5,600 16 Trademarks 1,600 10 Customer relationships 24,700 21 Total intangible assets $ 31,900 These intangible assets are amortized on a straight-line basis, which is presented in amortization in our condensed consolidated statements of operations. Amortization expense for the intangible assets for the Spectrum acquisition was $0.4 million and $0.8 million for the three and six months ended June 30, 2018 , respectively. Repeat Precision On February 1, 2017, we acquired a 50% interest in Repeat Precision for $6 . 0 million. Historically, the business has been a supplier to NCS. Our strategic purchase of 50% of this business ensures that we have continued access to these services and allows us greater control of the allocation of their capacity, ensuring that we can scale their operations together with ours. In addition, Repeat Precision also markets composite frac plugs and related products, providing an additional revenue opportunity. Concurrent with entering into the transaction, the previous owner of the 50% interest repaid a $1.0 million promissory note to us. We also recorded an earn-out at the acquisition date as a contingent adjustment to the purchase price in the amount of $7.0 million. We estimated the fair value of the earn-out using a Monte Carlo simulation on the acquisition date. The earn-out equity value was based on Repeat Precision’s 2018 EBITDA, multiplied by three, which was then reduced by debt and increased by cash. The earn-out equity value was then discounted at the adjusted cost of equity. The earn-out is subject to re-measurement each reporting period using Level 3 inputs until it has been paid. Subsequent changes in the fair value of the liability are reflected in our condensed consolidated statements of operations as a change in fair value of contingent consideration. As of June 30, 2018 , the earn-out had a value of $9. 7 million, which is included in current contingent consideration on the condensed consolidated balance sheet. As of December 31, 2017, the earn-out had a value of $9.4 million, which is included in noncurrent contingent consideration on the condensed consolidated balance sheet. We recognized $0.1 million and $0.8 million during the three months ended June 30, 2018 and 2017, respectively, in addition to $0.3 million and $0.8 million for the six months ended June 30, 2018 and 2017, respectively, as an increase in fair value of contingent consideration expense in the condensed consolidated statements of operations related to the change in fair value of the earn-out. The cash payment, if any, is expected to be paid during the first quarter of 2019 and will not exceed $10.0 million. As NCS has the controlling voting interest in Repeat Precision, we determined that the transaction was a business combination and used the acquisition method of accounting and have included Repeat Precision in our condensed consolidated financial statements from the acquisition date. As a result, the other party’s ownership percentage is presented separately as a non-controlling interest. The purchase price is allocated to the fair value of assets acquired and liabilities assumed as of the acquisition date and goodwill is recognized for the excess consideration transferred over the fair value of the net assets. By combining Repeat Precision’s expertise in providing high-quality machining services with NCS’s engineering capabilities, product development expertise and customer relationships, we believe that we have additional revenue opportunities for NCS to leverage the vertically integrated supply chain by developing and marketing new completions products. This expected synergy gives rise to goodwill being recorded as part of the purchase price of Repeat. The purchase price allocation was finalized during the first quarter of 2018. We have recognized $15.2 million of goodwill as a result of the transaction and expect the full amount to be deductible for tax purposes. We also incurred acquisition costs of $21 thousand and $0.3 million related to this acquisition for the three and six months ended June 30, 2017, respectively, which were included in general and administrative expense on our condensed consolidated statements of operations. The following table summarizes the consideration and the assets acquired at the Repeat Precision closing date (in thousands): Consideration Cash paid by NCS $ 5,996 Earn-out liability recognized 6,958 Total consideration $ 12,954 Preliminary purchase price allocation Other net assets $ 174 Inventory 662 Property and equipment 5,750 Intangible assets 4,100 Goodwill 15,222 Total assets acquired $ 25,908 Less: non-controlling interest (12,954) Net assets acquired $ 12,954 The unaudited pro forma operating results pursuant to ASC 805 related to the Repeat Precision acquisition have been excluded due to immateriality. In connection with the Repeat Precision acquisition, we acquired intangible assets in the amount of $4.1 million related to customer relationships. The intangible assets are amortized over their estimated ten -year useful lives. Amortization expense for the Repeat Precision acquisition was $0.1 million for each of the three months ended June 30, 2018 and 2017, respectively, and $0.2 million for each of the six months ended June 30, 2018 and 2017, respectively. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2018 | |
Inventories [Abstract] | |
Inventories | Note 4. Inventories Inventories consist of the following as of June 30, 2018 and December 31, 2017 (in thousands): June 30, December 31, 2018 2017 Raw materials $ 2,812 $ 2,412 Work in process 746 623 Finished goods 27,433 30,100 Total inventories $ 30,991 $ 33,135 |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2018 | |
Property and Equipment [Abstract] | |
Property and Equipment | Note 5. Property and Equipment Property and equipment by major asset class consist of the following as of June 30, 2018 and December 31, 2017 (in thousands): June 30, December 31, 2018 2017 Land $ 2,071 $ 2,167 Building and improvements 4,989 5,155 Machinery and equipment 14,057 13,418 Computers and software 2,093 2,157 Furniture and fixtures 1,042 1,013 Vehicles 6,809 5,751 Service equipment 244 244 31,305 29,905 Less: Accumulated depreciation and amortization (8,265) (7,012) 23,040 22,893 Construction in progress 2,651 758 Property and equipment, net $ 25,691 $ 23,651 |
Goodwill and Identifiable Intan
Goodwill and Identifiable Intangibles | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Identifiable Intangibles [Abstract] | |
Goodwill and Identifiable Intangibles | Note 6. Goodwill and Identifiable Intangibles Changes in the carrying amount of goodwill are as follows (in thousands): At December 31, 2016 $ 122,077 Acquisitions 55,409 Currency translation adjustment 6,992 At December 31, 2017 $ 184,478 Currency translation adjustment (4,959) At June 30, 2018 $ 179,519 Identifiable intangibles by major asset class consist of the following (in thousands) : June 30, 2018 Estimated Gross Useful Carrying Accumulated Net Lives (Years) Amount Amortization Balance Technology 14 - 16 $ 146,283 $ (56,068) $ 90,215 Trademarks 5 - 10 1,600 (133) 1,467 Customer relationships 10 - 21 40,458 (5,923) 34,535 Internally developed software 5 659 — 659 Total identifiable intangibles $ 189,000 $ (62,124) $ 126,876 December 31, 2017 Estimated Gross Useful Carrying Accumulated Net Lives (Years) Amount Amortization Balance Technology 14 - 16 $ 151,433 $ (52,730) $ 98,703 Trademarks 5 - 10 2,588 (1,042) 1,546 Customer relationships 10 - 21 41,058 (4,895) 36,163 Total identifiable intangibles $ 195,079 $ (58,667) $ 136,412 |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2018 | |
Accrued Expenses [Abstract] | |
Accrued Expenses | Note 7. Accrued Expenses Accrued expenses consist of the following as of June 30, 2018 and December 31, 2017 (in thousands): June 30, December 31, 2018 2017 Accrued payroll and bonus $ 3,999 $ 5,167 Property and franchise taxes accrual 200 390 Accrued acquisition related costs — 25 Accrued other miscellaneous liabilities 1,093 1,091 Total accrued expenses $ 5,292 $ 6,673 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2018 | |
Debt [Abstract] | |
Debt | Note 8. Debt Our long-term debt consists of the following as of June 30, 2018 and December 31, 2017 (in thousands): June 30, December 31, 2018 2017 Senior Secured Credit Facility $ 20,000 $ 20,000 Promissory note 448 3,313 Equipment notes 1,133 1,295 Capital leases 3,460 2,428 Total debt 25,041 27,036 Less: current portion (2,801) (5,334) Long-term debt $ 22,240 $ 21,702 The estimated fair value of total debt for the periods ended June 30, 2018 and December 31, 2017 was $24.5 million and $26.7 million, respectively. The carrying value of the Senior Secured Credit Facility and the promissory note approximated the fair value of debt as it can be paid at any time. The fair value for the remaining debt was estimated using Level 2 inputs by calculating the sum of the discounted future interest and principal payments through the date of maturity . Below is a description of our credit agreement and other financing arrangements. Senior Secured Credit Facility On May 4, 2017, we entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) with Pioneer Investment, Inc., as borrower (the “U.S. Borrower ”), NCS Multistage Inc., as borrower (the “Canadian Borrower”), Pioneer Intermediate, Inc. (together with the Company, the “Parent Guarantors”) and the lenders party thereto, Wells Fargo Bank, National Association as administrative agent in respect of the U.S. Facility (as defined below) and Wells Fargo Bank, National Association, Canadian Branch, as administrative agent in respect of the Canadian Facility (as defined below) (the senior secured revolving credit facilities provided thereunder, the “Senior Secured Credit Facility”). The Credit Agreement amended and restated the prior credit agreement in its entirety. The Senior Secured Credit Facility will mature on May 4, 2020 . The Senior Secured Credit Facility originally consisted of a (i) senior secured revolving credit facility in an aggregate principal amount of $25.0 million made available to the U.S. Borrower (the “U.S. Facility”), of which up to $5.0 million may be made available for letters of credit and up to $5.0 million may be made available for swingline loans and (ii) senior secured revolving credit facility in an aggregate principal amount of $25.0 million made available to the Canadian Borrower (the “Canadian Facility”). We entered into Amendment No. 1 to the Credit Agreement on August 31, 2017, which increased the loan commitment available to the U.S. Borrower to $50.0 million from $25.0 million under the U.S. Facility. The loan commitment available under the Canadian Facility remained at $25.0 million. On February 16, 2018, we entered into Amendment No. 2 to the Credit Agreement, which amended certain negative covenants contained in the Credit Agreement. As of June 30, 2018 and December 31, 2017, we had $20.0 million in outstanding indebtedness under the U.S. Facility and no outstanding indebtedness under the Canadian Facility. We incurred interest expense related to the Senior Secured Credit Facility of $0.4 million and $0.7 million for the three and six months ended June 30, 2018 , respectively. Borrowings under the U.S. Facility may be made in U.S. dollars, Canadian dollars or Euros and bear interest at a rate equal to the Adjusted Base Rate or Eurocurrency Rate (each as defined in the Credit Agreement), in each case, plus an applicable interest margin as set forth in the Credit Agreement. Borrowings under the Canadian Facility may be made in U.S. dollars or Canadian dollars and bear interest at the Canadian (Cdn) Base Rate, Canadian (U.S.) Base Rate, Eurocurrency Rate or Discount Rate (each as defined in the Credit Agreement), in each case, plus an applicable interest margin as set forth in the Credit Agreement. The Adjusted Base Rate, Canadian (U.S.) Base Rate and Canadian (Cdn) Base Rate applicable margin will be between 2.25% and 3.00% and Eurocurrency Rate applicable margin will be between 3.25% and 4.00% , in each case, depending on the Company’s leverage ratio. The applicable interest rate at June 30, 2018 was 6.25% . The obligations of the U.S. Borrower under the U.S. Facility are guaranteed by the Parent Guarantors and each of the other existing and future direct and indirect restricted subsidiaries of the Company organized under the laws of the United States (subject to certain exceptions) and are secured by substantially all of the assets of the Parent Guarantors, the U.S. Borrower and such other subsidiary guarantors, in each case, subject to certain exceptions and permitted liens. The obligations of the Canadian Borrower under the Canadian Facility are guaranteed by the Parent Guarantors, the U.S. Borrower and each of the future direct and indirect restricted subsidiaries of the Company organized under the laws of the United States and Canada (subject to certain exceptions) and are secured by substantially all of the assets of the Parent Guarantors, the U.S. Borrower, the Canadian Borrower and such subsidiary guarantors, if any, in each case, subject to certain exceptions and permitted liens. The Credit Agreement contains financial covenants that require (i) commencing with the fiscal quarter ending June 30, 2017, compliance with a leverage ratio test set at (A) 3.00 to 1.00 as of the last day of each fiscal quarter ending prior to March 31, 2018 and (B) 2.50 to 1.00 as of the last day of each fiscal quarter ending on or after March 31, 2018, (ii) commencing with the fiscal quarter ending June 30, 2017, compliance with an interest coverage ratio test set at 2.75 to 1.00 as of the last day of each fiscal quarter, (iii) if the leverage ratio as of the end of any fiscal quarter is greater than 2.00 to 1.00 and the amount outstanding under the Canadian Facility at any time during such fiscal quarter was greater than $0, compliance as of the end of such fiscal quarter with a Canadian asset coverage ratio test set at 1.00 to 1.00 and (iv) if the leverage ratio as of the end of any fiscal quarter is greater than 2.00 to 1.00 and the amount outstanding under the U.S. Facility at any time during such fiscal quarter was greater than $0, compliance as of the end of such fiscal quarter with a U.S. asset coverage ratio test set at 1.00 to 1.00. As of June 30, 2018 , we were in compliance with these financial covenants. The Credit Agreement also contains customary affirmative and negative covenants, including, among other things, restrictions on the creation of liens, the incurrence of indebtedness, investments, dividends and other restricted payments, dispositions and transactions with affiliates. The Credit Agreement also includes customary events of default for facilities of this type (with customary grace periods, as applicable). If an event of default occurs, the lenders under each of the U.S. Facility and the Canadian Facility may elect (after the expiration of any applicable notice or grace periods) to declare all outstanding borrowings under such facility, together with accrued and unpaid interest and other amounts payable thereunder, to be immediately due and payable. The lenders under each of the U.S. Facility and the Canadian Facility also have the right upon an event of default thereunder to terminate any commitments they have to provide further borrowings under such facility. Further, following an event of default under each of the U.S. Facility and the Canadian Facility, the lenders thereunder will have the right to proceed against the collateral granted to them to secure such facility. Direct costs of $1.0 million were incurred in connection with the Senior Secured Credit Facility. The costs were capitalized as an asset as they represent the benefit of being able to access capital over the contractual term. The costs are being amortized over the term of the Senior Secured Credit Facility using the straight-line method. Amortization expense of the deferred financing charges of $0.1 million and $0.2 million was included in interest expense, net for the three and six months ended June 30, 2018 , respectively. Promissory Note On February 27, 2017, Repeat Precision entered into a promissory note with Security State Bank & Trust, Fredericksburg, for an aggregate borrowing capacity of $3.8 million. The promissory note is secured against equipment, inventory and receivables. It bears interest at a variable interest rate based on prime plus 1.00% . Any principal amount not paid by the maturity date bears interest at the lesser of the maximum rate allowed per law or 18.00% per annum. The promissory note was renewed on February 16, 2018 for an aggregate borrowing capacity of $4.3 million and is scheduled to mature on February 16, 2019 . No other terms were changed. As of June 30, 2018 and December 31, 2017, the outstanding balance on the promissory note was $0 .4 million and $3.3 million, respectively. Equipment Notes In February 2017, Repeat Precision entered into an equipment note in the amount of $0.8 million with Security State Bank & Trust, Fredericksburg. The equipment note bears interest at prime plus 1.00% , matures on February 27, 2021 and is collateralized by certain property. Any principal amount not paid by the maturity date bears interest at the lesser of the maximum rate allowed per law or 18.00% per annum. As of June 30, 2018 and December 31, 2017, the outstanding balance on the equipment note was $0.5 million and $0.6 million, respectively. In April 2017, Repeat Precision entered into another equipment note in the amount of $0.8 million with Security State Bank & Trust, Fredericksburg. The equipment note bears interest at prime plus 1.00% , matures on December 21, 2018 and is collateralized by certain property. Any principal amount not paid by the maturity date bears interest at the lesser of the maximum rate allowed per law or 18.00% per annum. As of June 30, 2018 and December 31, 2017, the outstanding balance on the equipment note was $0.6 million and $0.7 million, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 9. Commitments and Contingencies Litigation In the ordinary course of our business, from time to time, we have various claims, lawsuits and administrative proceedings that are pending or threatened with respect to commercial, intellectual property and employee matters. On July 24, 2018, we filed a patent infringement lawsuit against Kobold Corporation, Kobold Completions Inc. and 2039974 Alberta Ltd. (“Kobold”) in the Federal Court of Canada, alleging that Kobold’s fracturing tools and methods infringe on several of our Canadian patents. We previously filed a breach of contract lawsuit on March 16, 2018, against Kobold Corporation in the Court of Queen’s Bench of Alberta, alleging breach of a prior settlement agreement. Both of these lawsuit s seek unspecified monetary damages and injunctive relief. While the outcome of any legal proceedings cannot be predicted with any certainty, based on a consideration of relevant facts and circumstances, our management currently does not expect that the results of these legal proceedings would have a material adverse effect on our financial position, results of operations or cash flows. On March 3, 2017, we received $0.9 million resulting from an arbitration case that was decided in our favor in February 2017. This was recorded as other income, net in our condensed consolidated statements of operations for the six months ended June 30, 2017 . |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2018 | |
Stockholders' Equity [Abstract] | |
Stockholders' Equity | Note 10. Stockholders’ Equity The holders of common stock are entitled to one vote for each share of common stock held. The holder, Cemblend Systems, Inc. (“Cemblend”), of the one share of preferred stock, designated as the “Special Voting Share” in our amended and restated certificate of incorporation, is entitled to vote on all matters that a holder of common stock is entitled to vote on and is entitled to cast a number of votes equal to the number of exchangeable shares of NCS Multistage, Inc. (“NCS Canada”) , a subsidiary of the Company, then outstanding that are not owned by us, multiplied by the exchange ratio (as defined in the articles of incorporation of NCS Canada), which was adjusted from one to three in April 2017 in connection with our stock split. As of June 30, 2018 and December 31, 2017, one share of preferred stock was issued and outstanding. As of December 31, 2017 , the number of shares of common stock issuable for the exchangeable shares totaled 1,769,247 and was held by Cemblend. On February 14, 2018, we issued 442,312 shares of common stock to Cemblend in exchange for shares of NCS Canada. As of June 30, 2018 , the number of shares of common stock issuable for the exchangeable shares totaled 1,326,935 . The exchangeable shares are convertible upon demand at the stock price on the conversion date. The holders of common stock are entitled to receive dividends as declared from time-to-time by our board of directors. The holder of the Special Voting Share is not entitled to receive dividends. No dividends were declared during the periods ended June 30, 2018 or December 31, 2017 . |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Jun. 30, 2018 | |
Share-Based Compensation [Abstract] | |
Share-Based Compensation | Note 11. Share- Based Compensation During the first quarter of 2018, we granted 582,184 restricted stock units (“RSUs”) at a weighted average grant date fair value of $14.54 . Of the RSUs granted, 536,014 will vest and settle ratably over three years on each anniversary of the date of grant and 46,170 , which were granted to the non-employee members of the Board of Directors, will vest on the one year anniversary of the grant date. T he RSUs for the members of the Board of Directors settle for shares of common stock on a one-for-one basis within thirty days following the earliest of (i) one year following the termination of the person’s service for any reason other than cause, (ii) a change of control or (iii) the fifth anniversary of the grant date. During the first quarter of 2018, we also granted 156,516 of performance stock unit awards (“PSUs”) with a performance period from January 1, 2018 to December 31, 2020. The fair value of the PSUs of $17.37 was measured using a Monte Carlo simulation on the date the PSUs were granted. The number of PSUs ultimately issued under the program is dependent upon our total shareholder return relative to our performance peer group over a three -year performance period. In no event shall the participant earn more than 200% of the target PSUs. If the actual performance falls below the predefined target, the number of shares vested is reduced. If the actual performance falls below the threshold performance level, no PSUs will vest. The total share-based compensation expense for all awards was $3.0 million and $1. 5 million for the three months ended June 30, 2018 and 2017 , respectively, and $5.3 million and $1.8 million for the six months ended June 30, 2018 and 2017, respectively. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | Note 12. Income Taxes The computation of the annual expected effective tax rate at each interim period requires certain estimates and assumptions including , but not limited to, the expected operating income (or loss) for the year, projections of the proportion of income (or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences and the likelihood of recovering deferred tax assets generated in the current year. The accounting estimates used to compute the provision for income taxes may change as new events occur, more experience is acquired or additional information is obtained. The computation of the annual effective rate would include applicable modifications, which were projected for the year, such as certain book expenses not deductible for tax, tax credits and foreign deemed dividends. We recorded a tax (benefit) of $(1.0) million and $(0.9) million for the three months ended June 30, 2018 and 2017 , respectively. For the three months ended June 30, 2018 and 2017 , our effective tax rates were (26.6)% and (15.3)% , respectively. For the six months ended June 30, 2018 and 2017, we recorded a tax (benefit) expense of $(0.1) million and $1.2 million, respectively. The effective tax rates for the six months ended June 30, 2018 and 2017 were (0.8) % and 43.7% , respectively. The income tax expense and effective tax rate for the three and six months ended June 30, 2018 were significantly impacted by the U.S. Tax Cuts and Jobs Act of 2017 (the “2017 Tax Act ”) including administrative guidance issued by the Internal Revenue Service on April 2, 2018. This guidance along with other updates resulted in a change to the calculation of the mandatory one-time tax on accumulated earnings of foreign subsidiaries in 2017 and a tax benefit of $0.5 million and $2.6 million for the three and six months ended June 30, 2018, respectively, was recorded in tax expense with a corresponding reduction in the effective tax rate of 13.1% and 29.1% , respectivel y. Additionally, the effective tax rate for the six months ended June 30, 2018 included a tax benefit of $0.3 million for the tax effect of exercised stock option awards. The 2017 Tax Act was signed into law on December 22, 2017. The 2017 Tax Act significantly revised the U.S. corporate income tax by, among other things, lowering the statutory corporate tax rate from 35% to 21% , eliminating certain deductions, imposing a mandatory one-time tax on accumulated earnings of foreign subsidiaries as of 2017, introducing new tax regimes, and changing how foreign earnings are subject to U.S. tax. Our preliminary estimate of the 2017 Tax Act and the remeasurement of our deferred tax assets and liabilities is subject to the finalization of management’s analysis related to certain matters, such as developing interpretations of the provisions of the 2017 Tax Act, changes to certain estimates and the filing of our tax returns. U.S. Treasury regulations, administrative interpretations or court decisions interpreting the 2017 Tax Act may require further adjustments and changes in our estimates. The final determination of the impact of the 2017 Tax Act and the remeasurement of our deferred assets and liabilities will be completed as additional information becomes available, but no later than one year from the enactment of the 2017 Tax Act in accordance with SAB 118. Those adjustments may impact our provision for income taxes in the period in which the adjustments are made. For our calendar year beginning in 2018 we are subject to several provisions of the 2017 Tax Act including computations under Global Intangible Low Taxed Income (“GILTI”) and Foreign Derived Intangible Income (“FDII”). We were able to make a reasonable estimate of the impact of each provision of the 2017 Tax Act on our effective tax rate for the three and six months ended June 30, 2018. We will continue to refine our provisional estimates for our computations under the GILTI and FDII rules as we gather additional information. ASC 740 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The impact of an uncertain income tax position on the income tax returns must be recognized at the largest amount that is more-likely-than-not to be required to be recognized upon audit by the relevant taxing authority. This standard also provides guidance on de-recognition, measurement, classification, interest and penalties, accounting for interim periods, disclosure and transition issues with respect to tax positions. We include interest and penalties as a component of other income, net in the condensed consolidated statements of operations and recognized $46 thousand and $2 thousand for the six months ended June 30, 2018 and 2017, respectively. |
(Loss) Earnings Per Common Shar
(Loss) Earnings Per Common Share | 6 Months Ended |
Jun. 30, 2018 | |
(Loss) Earnings Per Common Share [Abstract] | |
(Loss) Earnings Per Common Share | Note 13. (Loss) Earnings Per Common Share The following table presents the reconciliation of the numerator and denominator for calculating (loss) earnings per common share from net (loss) income ( in thousands, except per share data) : Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Numerator—Basic Net (loss) income $ (2,818) $ (4,745) $ 9,047 $ 1,603 Less: income attributable to participating shares — — 282 74 Less: income (loss) attributable to non-controlling interest 1,235 (254) 2,122 (456) Net (loss) income attributable to NCS Multistage Holdings, Inc.––Basic $ (4,053) $ (4,491) $ 6,643 $ 1,985 Numerator—Diluted Net (loss) income $ (2,818) $ (4,745) $ 9,047 $ 1,603 Less: income (loss) attributable to non-controlling interest 1,235 (254) 2,122 (456) Net (loss) income attributable to NCS Multistage Holdings, Inc.––Diluted $ (4,053) $ (4,491) $ 6,925 $ 2,059 Denominator Basic weighted average number of shares 44,778 40,198 44,517 37,119 Exchangeable shares for common stock — — 1,434 1,803 Dilutive effect of stock options, RSUs, PSUs and ESPP — — 1,235 1,266 Diluted weighted average number of shares 44,778 40,198 47,186 40,188 (Loss) earnings per common share Basic $ (0.09) $ (0.11) $ 0.15 $ 0.05 Diluted $ (0.09) $ (0.11) $ 0.15 $ 0.05 Potentially dilutive securities excluded as anti-dilutive 5,040 3,307 231 - |
Segment and Geographic Informat
Segment and Geographic Information | 6 Months Ended |
Jun. 30, 2018 | |
Segment and Geographic Information [Abstract] | |
Segment and Geographic Information | Note 14. Segment and Geographic Information We have determined that we operate in one reportable segment that has been identified based on how our chief operating decision maker manages our business. |
Basis of Presentation (Policy)
Basis of Presentation (Policy) | 6 Months Ended |
Jun. 30, 2018 | |
Basis of Presentation [Abstract] | |
Nature of Business | Nature of Business NCS Multistage Holdings, Inc., through its wholly owned subsidiaries and subsidiaries for which we have a controlling voting interest (collectively referred to as the “Company,” “NCS,” “we” or “us”), is primarily engaged in providing engineered products and support services for oil and natural gas well completions and field development strategies. We offer our products and services primarily to exploration and production companies for use in onshore wells. We operate through service facilities principally located in Houston, Midland and Corpus Christi, Texas; Tulsa and Oklahoma City, Oklahoma; and Calgary, Red Deer, Grande Prairie and Estevan, Canada. |
Basis of Presentation | Basis of Presentation Our accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), issued by the Securities Exchange Commission (“SEC”) and have not been audited by our independent registered public accounting firm. The Condensed Consolidated Balance Sheet at December 31, 2017 is derived from our audited financial statements. However, certain information and footnote disclosures required by GAAP for complete annual financial statements have been omitted or condensed as permitted by the rules and regulations of the SEC, and, therefore, these interim financial statements should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K filed with the SEC on March 9, 2018. In the opinion of management, these condensed consolidated financial statements, which have been prepared pursuant to the rules of the SEC and GAAP for interim financial reporting, reflect all adjustments, which consisted only of normal recurring adjustments that were necessary for a fair statement of the interim periods presented. The results of operations for interim periods are not necessarily indicative of those for a full year. All intercompany accounts and transactions have been eliminated for purposes of preparing these condensed consolidated financial statements. |
Intangible Assets | Intangible Assets Certain costs incurred in the development of internal-use software applications are capitalized and costs incurred outside of the software application development stage are expensed as incurred. The amounts capitalized are included in intangibles, categorized as internally developed software, and will be amortized on a straight-line basis over the estimated useful life of the software, which is five years . We will begin to amortize internal-use software when it is ready for its intended use. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Pronouncements Adopted in 2018 In June 2018, the Financial Accounting Standards Board (“ FASB”) issued Accounting Standards Update (“ASU”) 2018-07 , Improvements to Nonemployee Share-Based Payment Accounting (Topic 718). The ASU is intended to reduce the cost and complexity and to improve financial reporting for nonemployee share-based payments. The ASU expands the scope of Topic 718 to include share-based payments issued to nonemployees for goods or services. Consequently, the accounting for share-based payments to nonemployees and employees will be substantially aligned. The ASU is for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606, Revenue from Contracts with Customers . We have elected to early adopt this ASU on April 1, 2018. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business (Topic 805) , to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. For public entities, this guidance is effective for annual periods beginning after December 15, 2017, including interim periods within those periods. We adopted ASU 2017-01 on January 1, 2018, which did not have a material impact on our condensed consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments (Topic 230) . The objective of the guidance is to reduce the existing diversity in practice related to the presentation and classification of certain cash receipts and cash payments. The guidance addresses eight specific cash flow issues including but not limited to, debt prepayment or extinguishment costs, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims and proceeds from the settlement of corporate-owned life insurance policies. For public entities, the guidance is effective for financial statements issued for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years and is retrospective for all periods presented. Early adoption is permitted including for interim periods. We adopted ASU 2016-15 on January 1, 2018, which did not have a material impact on our condensed consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09 , Revenue from Contracts with Customers (Topic 606) . The new standard is effective for annual reporting periods beginning after December 15, 2017 and early adoption is permitted, however, not before fiscal years beginning after December 15, 2016. Subsequent to ASU 2014-09’s issuance, Topic 606 was amended for FASB updates that changed the effective date as well as addressed certain aspects regarding new revenue standards. The comprehensive new standard will supersede existing revenue recognition guidance and require revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which entities expect to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions. The guidance permits the use of either a full retrospective or modified retrospective transition method. On January 1, 2018, we adopted ASU 2014-09 and its related amendments (collectively known as Accounting Standards Codification “ASC 606”), using the modified retrospective method. We have concluded that the adoption of this ASU did not have a material impact on our condensed consolidated financial statements. See “Note 2. Revenue” for the required disclosures related to the impact of adopting this standard. Pronouncements Not Yet Effective In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which replaces the existing guidance in ASC 840, Leases . Under ASC 842, lessees will need to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. The new lease standard also changes the definition of a lease and requires expanded quantitative and qualitative disclosures for both lessees and lessors. Entities are required to adopt ASC 842 using a modified retrospective transition method. Certain practical expedients can be applied. The new standard is effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted. We plan to adopt ASC 842 effective January 1, 2019 and are currently assessing the impact of the adoption. During the second quarter of 2018, we put in place a team, including a third-party consultant, to evaluate our current lease contracts and analyze contracts that may contain lease components. While we cannot currently estimate the quantitative effect that ASC 842 will have on our condensed consolidated financial statements, the adoption of ASC 842 will increase our asset and liability balances on the condensed consolidated balance sheets due to the required recognition of right-of-use assets and corresponding lease liabilities for most lease obligations that are currently classified as operating leases. |
Revenues (Tables)
Revenues (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenues [Abstract] | |
Financial Statement Impact of Adopting ASC 606 | Balance at Adjustments December 31, due to Balance at 2017 ASC 606 January 1, 2018 Assets Accounts receivable—trade, net $ 47,880 $ 313 $ 48,193 Liabilities Income taxes payable $ 10,561 $ 66 $ 10,627 Equity Retained earnings $ 23,864 $ 247 $ 24,111 The following tables compare the reported condensed consolidated balance sheet as of June 30, 2018 and statements of operations for the three and six months ended June 30, 2018 , to the balances without the adoption of ASC 606 (in thousands): As of June 30, 2018 Balances Effect of without Adoption Change As Reported of ASC 606 Higher/(Lower) Balance Sheet Assets Accounts receivable—trade, net $ 40,394 $ 40,235 $ 159 Liabilities Income taxes payable $ 129 $ 96 $ 33 Equity Retained earnings $ 31,036 $ 30,910 $ 126 Three Months Ended June 30, 2018 Six Months Ended June 30, 2018 Balances Effect of Balances Effect of without Adoption Change without Adoption Change As Reported of ASC 606 Higher/(Lower) As Reported of ASC 606 Higher/(Lower) Income Statement Revenues Services $ 15,625 $ 16,044 $ (419) $ 36,203 $ 36,357 $ (154) Costs and expenses Income tax (benefit) expense $ (1,019) $ (931) $ (88) $ (74) $ (42) $ (32) Net income $ (2,818) $ (2,487) $ (331) $ 9,047 $ 9,169 $ (122) Net income attributable to NCS Multistage Holdings, Inc. $ (4,053) $ (3,722) $ (331) $ 6,925 $ 7,047 $ (122) |
Disaggregation of Revenue by Geographic Region | Three Months Ended Six Months Ended June 30, June 30, 2018 2018 United States Product sales $ 16,309 $ 29,886 Services 11,396 19,819 Total United States 27,705 49,705 Canada Product sales 10,740 46,438 Services 3,132 14,609 Total Canada 13,872 61,047 Other Countries Product sales 724 1,557 Services 1,097 1,775 Total Other Countries 1,821 3,332 Total Product sales 27,773 77,881 Services 15,625 36,203 Total $ 43,398 $ 114,084 |
Schedule of Contract Assets and Liabilities | Contract Assets Contract Liabilities Current Non-Current Current Non-Current Balance at January 1, 2018 $ — $ — $ 170 $ — Additions — — 301 — Revenue recognized — — (170) — Balance at June 30, 2018 $ — $ — $ 301 $ — |
Acquisitions (Tables)
Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Spectrum Tracer Services [Member] | |
Summary of Selected Financial Information on Pro Forma Basis | Pro Forma (Unaudited) Three Months Ended Six Months Ended June 30, 2017 June 30, 2017 Revenue $ 44,771 $ 108,777 Net (loss) income attributable to NCS Multistage Holdings, Inc. $ (3,846) $ 3,416 Diluted earnings per share $ (0.09) $ 0.08 |
Summary of Consideration and Assets Acquired | Consideration Cash consideration $ 76,485 Equity consideration 6,907 Earn-out liability recognized 352 Total consideration $ 83,744 Preliminary purchase price allocation Cash $ 1,326 Accounts receivable 4,648 Inventories 3,761 Other current assets 480 Property and equipment 4,725 Intangible assets 31,900 Other long-term assets 26 Total identifiable assets acquired 46,866 Accounts payable—trade 454 Accrued expenses 436 Income taxes payable 228 Other current liabilities 44 Deferred tax liability 956 Other long-term liabilities 1,191 Total liabilities assumed 3,309 Net identifiable assets acquired 43,557 Goodwill 40,187 Net assets acquired $ 83,744 |
Schedule of Amount Allocated to Intangible Assets | Estimated Useful Fair Value Lives (Years) Technology $ 5,600 16 Trademarks 1,600 10 Customer relationships 24,700 21 Total intangible assets $ 31,900 |
Repeat Precision [Member] | |
Summary of Consideration and Assets Acquired | Consideration Cash paid by NCS $ 5,996 Earn-out liability recognized 6,958 Total consideration $ 12,954 Preliminary purchase price allocation Other net assets $ 174 Inventory 662 Property and equipment 5,750 Intangible assets 4,100 Goodwill 15,222 Total assets acquired $ 25,908 Less: non-controlling interest (12,954) Net assets acquired $ 12,954 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Inventories [Abstract] | |
Schedule of Inventories | June 30, December 31, 2018 2017 Raw materials $ 2,812 $ 2,412 Work in process 746 623 Finished goods 27,433 30,100 Total inventories $ 30,991 $ 33,135 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Property and Equipment [Abstract] | |
Schedule of Property and Equipment by Major Asset Class | June 30, December 31, 2018 2017 Land $ 2,071 $ 2,167 Building and improvements 4,989 5,155 Machinery and equipment 14,057 13,418 Computers and software 2,093 2,157 Furniture and fixtures 1,042 1,013 Vehicles 6,809 5,751 Service equipment 244 244 31,305 29,905 Less: Accumulated depreciation and amortization (8,265) (7,012) 23,040 22,893 Construction in progress 2,651 758 Property and equipment, net $ 25,691 $ 23,651 |
Goodwill and Identifiable Int28
Goodwill and Identifiable Intangibles (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Identifiable Intangibles [Abstract] | |
Changes in Carrying Amount of Goodwill | At December 31, 2016 $ 122,077 Acquisitions 55,409 Currency translation adjustment 6,992 At December 31, 2017 $ 184,478 Currency translation adjustment (4,959) At June 30, 2018 $ 179,519 |
Schedule of Identifiable Intangibles | June 30, 2018 Estimated Gross Useful Carrying Accumulated Net Lives (Years) Amount Amortization Balance Technology 14 - 16 $ 146,283 $ (56,068) $ 90,215 Trademarks 5 - 10 1,600 (133) 1,467 Customer relationships 10 - 21 40,458 (5,923) 34,535 Internally developed software 5 659 — 659 Total identifiable intangibles $ 189,000 $ (62,124) $ 126,876 December 31, 2017 Estimated Gross Useful Carrying Accumulated Net Lives (Years) Amount Amortization Balance Technology 14 - 16 $ 151,433 $ (52,730) $ 98,703 Trademarks 5 - 10 2,588 (1,042) 1,546 Customer relationships 10 - 21 41,058 (4,895) 36,163 Total identifiable intangibles $ 195,079 $ (58,667) $ 136,412 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accrued Expenses [Abstract] | |
Schedule of Accrued Expenses | June 30, December 31, 2018 2017 Accrued payroll and bonus $ 3,999 $ 5,167 Property and franchise taxes accrual 200 390 Accrued acquisition related costs — 25 Accrued other miscellaneous liabilities 1,093 1,091 Total accrued expenses $ 5,292 $ 6,673 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt [Abstract] | |
Schedule of Long-term Debt | June 30, December 31, 2018 2017 Senior Secured Credit Facility $ 20,000 $ 20,000 Promissory note 448 3,313 Equipment notes 1,133 1,295 Capital leases 3,460 2,428 Total debt 25,041 27,036 Less: current portion (2,801) (5,334) Long-term debt $ 22,240 $ 21,702 |
(Loss) Earnings Per Common Sh31
(Loss) Earnings Per Common Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
(Loss) Earnings Per Common Share [Abstract] | |
Reconciliation of Numerator and Denominator for Calculating (Loss) Earnings Per Share from Net (Loss) Income | Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Numerator—Basic Net (loss) income $ (2,818) $ (4,745) $ 9,047 $ 1,603 Less: income attributable to participating shares — — 282 74 Less: income (loss) attributable to non-controlling interest 1,235 (254) 2,122 (456) Net (loss) income attributable to NCS Multistage Holdings, Inc.––Basic $ (4,053) $ (4,491) $ 6,643 $ 1,985 Numerator—Diluted Net (loss) income $ (2,818) $ (4,745) $ 9,047 $ 1,603 Less: income (loss) attributable to non-controlling interest 1,235 (254) 2,122 (456) Net (loss) income attributable to NCS Multistage Holdings, Inc.––Diluted $ (4,053) $ (4,491) $ 6,925 $ 2,059 Denominator Basic weighted average number of shares 44,778 40,198 44,517 37,119 Exchangeable shares for common stock — — 1,434 1,803 Dilutive effect of stock options, RSUs, PSUs and ESPP — — 1,235 1,266 Diluted weighted average number of shares 44,778 40,198 47,186 40,188 (Loss) earnings per common share Basic $ (0.09) $ (0.11) $ 0.15 $ 0.05 Diluted $ (0.09) $ (0.11) $ 0.15 $ 0.05 Potentially dilutive securities excluded as anti-dilutive 5,040 3,307 231 - |
Basis of Presentation (Narrativ
Basis of Presentation (Narrative) (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Internally Developed Software [Member] | |
Estimated useful lives | 5 years |
Revenues (Narrative) (Details)
Revenues (Narrative) (Details) - item | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018 | Jun. 30, 2018 | |
Revenues [Abstract] | ||
Percentage of product and service revenues single performance obligation | 99.00% | |
Percentage of self-service product line revenues performance obligation | 1.00% | 1.00% |
Number of performance obligations in product and service revenue | 1 | |
Number of performance obligations in self-service product line revenue | 2 | |
Revenue performance obligation product and services description | Greater than 99% of our product and service revenues are considered a single performance obligation. Our self-service product line, which is less than one percent of our revenue for the three and six months ended June 30, 2018, is made up of two performance obligations: (i) the delivery of tracer materials to a customer well site and (ii) the creation of diagnostic reports ordered by customers when we do not perform an integrated service. |
Revenues (Financial Statement I
Revenues (Financial Statement Impact of Adopting ASC 606) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jan. 01, 2018 | Dec. 31, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Accounts receivable - trade, net | $ 40,394 | $ 40,394 | $ 48,193 | $ 47,880 | ||
Income taxes payable | 129 | 129 | 10,627 | 10,561 | ||
Retained earnings | 31,036 | 31,036 | 24,111 | $ 23,864 | ||
Revenues | 43,398 | $ 36,857 | 114,084 | $ 95,493 | ||
Income tax (benefit) expense | (1,019) | (855) | (74) | 1,245 | ||
Net income | (2,818) | (4,745) | 9,047 | 1,603 | ||
Net (loss) income attributable to NCS Multistage Holdings, Inc.—Diluted | (4,053) | (4,491) | 6,925 | 2,059 | ||
Balances Without Adoption of ASC 606 [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Accounts receivable - trade, net | 40,235 | 40,235 | ||||
Income taxes payable | 96 | 96 | ||||
Retained earnings | 30,910 | 30,910 | ||||
Income tax (benefit) expense | (931) | (42) | ||||
Net income | (2,487) | 9,169 | ||||
Net (loss) income attributable to NCS Multistage Holdings, Inc.—Diluted | (3,722) | 7,047 | ||||
Effect of Change Higher/(Lower) [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Income tax (benefit) expense | (32) | |||||
Net income | (122) | |||||
Net (loss) income attributable to NCS Multistage Holdings, Inc.—Diluted | (122) | |||||
Adjustments due to ASC 606 [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Accounts receivable - trade, net | 313 | |||||
Income taxes payable | 66 | |||||
Retained earnings | $ 247 | |||||
Adjustments due to ASC 606 [Member] | Effect of Change Higher/(Lower) [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Accounts receivable - trade, net | 159 | 159 | ||||
Income taxes payable | 33 | 33 | ||||
Retained earnings | 126 | 126 | ||||
Income tax (benefit) expense | (88) | |||||
Net income | (331) | |||||
Net (loss) income attributable to NCS Multistage Holdings, Inc.—Diluted | (331) | |||||
Services [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenues | 15,625 | $ 7,460 | 36,203 | $ 20,522 | ||
Services [Member] | Balances Without Adoption of ASC 606 [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenues | 16,044 | 36,357 | ||||
Services [Member] | Effect of Change Higher/(Lower) [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenues | $ (154) | |||||
Services [Member] | Adjustments due to ASC 606 [Member] | Effect of Change Higher/(Lower) [Member] | ||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||||
Revenues | $ (419) |
Revenues (Disaggregation of Rev
Revenues (Disaggregation of Revenue by Geographic Region) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 43,398 | $ 36,857 | $ 114,084 | $ 95,493 |
Product sales [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 27,773 | 29,397 | 77,881 | 74,971 |
Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 15,625 | $ 7,460 | 36,203 | $ 20,522 |
United States [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 27,705 | 49,705 | ||
United States [Member] | Product sales [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 16,309 | 29,886 | ||
United States [Member] | Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 11,396 | 19,819 | ||
Canada [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 13,872 | 61,047 | ||
Canada [Member] | Product sales [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 10,740 | 46,438 | ||
Canada [Member] | Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 3,132 | 14,609 | ||
Other Countries [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,821 | 3,332 | ||
Other Countries [Member] | Product sales [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 724 | 1,557 | ||
Other Countries [Member] | Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 1,097 | $ 1,775 |
Revenues (Schedule of Contract
Revenues (Schedule of Contract Assets and Liabilities) (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Change in Contract with Customer, Asset and Liability [Abstract] | |
Contract Liabilities Current Balance at January 1, 2018 | $ 170 |
Additions | 301 |
Revenue recognized | (170) |
Contract Liabilities Current Balance at June 30, 2018 | $ 301 |
Acquisition (Narrative) (Detail
Acquisition (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | Aug. 31, 2017 | Feb. 01, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | ||||||||
Business combination, earn-out amount | $ 12,835 | |||||||
Change in fair value of contingent consideration | $ 213 | $ 767 | $ (1,140) | $ 767 | ||||
Goodwill | 179,519 | 179,519 | $ 184,478 | $ 122,077 | ||||
Income tax (benefit) expense | (1,019) | (855) | (74) | 1,245 | ||||
Amortization of intangible assets | 3,283 | 5,973 | $ 6,604 | 11,995 | ||||
Customer Relationships [Member] | Minimum [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived intangible asset, useful life | 10 years | 10 years | ||||||
Customer Relationships [Member] | Maximum [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived intangible asset, useful life | 21 years | 21 years | ||||||
Spectrum Tracer Services [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Ownership interest acquired, percent | 100.00% | |||||||
Business combination consideration transferred | $ 83,744 | |||||||
Common stock issued in business acquisition | 0.4 | |||||||
Cash payment for acquisition | $ 76,485 | |||||||
Common stock price per share | $ 19.42 | |||||||
Business combination, earn-out amount | $ 400 | 2,000 | $ 2,000 | $ 3,400 | ||||
Change in fair value of contingent consideration | 100 | |||||||
Goodwill | 40,187 | |||||||
Business combination goodwill not deductible for tax purpose | $ 6,000 | |||||||
Acquisition costs | 300 | 400 | ||||||
Amortization of intangible assets | 400 | 800 | ||||||
Spectrum Tracer Services [Member] | If Actual Gross Profit Greater Than Earn-Out Threshold During October 1, 2017 and December 31, 2018 [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Maximum earn-out contingent consideration | 12,500 | 12,500 | ||||||
Spectrum Tracer Services [Member] | Customer Relationships [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived intangible asset, useful life | 21 years | |||||||
Repeat Precision [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Ownership interest acquired, percent | 50.00% | |||||||
Business combination consideration transferred | $ 12,954 | |||||||
Cash payment for acquisition | 5,996 | |||||||
Maximum earn-out contingent consideration | 10,000 | 10,000 | ||||||
Business combination, earn-out amount | 9,700 | 9,700 | $ 9,400 | |||||
Proceeds from promissory note | 1,000 | |||||||
Earn-out as a contingent adjustment to asset purchase price | 7,000 | |||||||
Change in fair value of contingent consideration | 100 | 800 | 300 | 800 | ||||
Goodwill | 15,222 | |||||||
Acquisition costs | 21 | 300 | ||||||
Amortization of intangible assets | $ 100 | $ 100 | $ 200 | $ 200 | ||||
Repeat Precision [Member] | Customer Relationships [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Finite-lived intangible assets acquired | $ 4,100 | |||||||
Finite-lived intangible asset, useful life | 10 years |
Acquisition (Summary of Selecte
Acquisition (Summary of Selected Financial Information on Pro Forma Basis) (Details) - Spectrum Tracer Services [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2017 | Jun. 30, 2017 | |
Revenue | $ 44,771 | $ 108,777 |
Net income attributable to NCS Multistage Holdings, Inc. | $ (3,846) | $ 3,416 |
Diluted earnings per share | $ (0.09) | $ 0.08 |
Acquisitions (Summary of Consid
Acquisitions (Summary of Consideration and Assets Acquired) (Details) - USD ($) $ in Thousands | Aug. 31, 2017 | Feb. 01, 2017 | Jun. 30, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Preliminary purchase price allocation | |||||
Goodwill | $ 179,519 | $ 184,478 | $ 122,077 | ||
Spectrum Tracer Services [Member] | |||||
Consideration | |||||
Cash consideration | $ 76,485 | ||||
Equity consideration | 6,907 | ||||
Earn-out liability recognized | 352 | ||||
Total consideration | 83,744 | ||||
Preliminary purchase price allocation | |||||
Cash | 1,326 | ||||
Accounts receivable | 4,648 | ||||
Inventories | 3,761 | ||||
Other current assets | 480 | ||||
Property and equipment | 4,725 | ||||
Intangible assets | 31,900 | ||||
Other long-term assets | 26 | ||||
Total identifiable assets acquired | 46,866 | ||||
Accounts payable—trade | 454 | ||||
Accrued expenses | 436 | ||||
Income taxes payable | 228 | ||||
Other current liabilities | 44 | ||||
Deferred tax liability | 956 | ||||
Other long-term liabilities | 1,191 | ||||
Total liabilities assumed | 3,309 | ||||
Net identifiable assets acquired | 43,557 | ||||
Goodwill | 40,187 | ||||
Net assets acquired | $ 83,744 | ||||
Repeat Precision [Member] | |||||
Consideration | |||||
Cash consideration | $ 5,996 | ||||
Earn-out liability recognized | 6,958 | ||||
Total consideration | 12,954 | ||||
Preliminary purchase price allocation | |||||
Other net assets | 174 | ||||
Inventories | 662 | ||||
Property and equipment | 5,750 | ||||
Intangible assets | 4,100 | ||||
Total identifiable assets acquired | 25,908 | ||||
Goodwill | 15,222 | ||||
Less: non-controlling interest | (12,954) | ||||
Net assets acquired | $ 12,954 |
Acquisitions (Schedule of Amoun
Acquisitions (Schedule of Amount Allocated to Intangible Assets) (Details) - USD ($) $ in Thousands | Aug. 31, 2017 | Jun. 30, 2018 | Dec. 31, 2017 |
Spectrum Tracer Services [Member] | |||
Intangibles assets, fair value | $ 31,900 | ||
Technology [Member] | Minimum [Member] | |||
Estimated useful lives | 14 years | 14 years | |
Technology [Member] | Maximum [Member] | |||
Estimated useful lives | 16 years | 16 years | |
Technology [Member] | Spectrum Tracer Services [Member] | |||
Intangibles assets, fair value | $ 5,600 | ||
Estimated useful lives | 16 years | ||
Trademarks [Member] | Minimum [Member] | |||
Estimated useful lives | 5 years | 5 years | |
Trademarks [Member] | Maximum [Member] | |||
Estimated useful lives | 10 years | 10 years | |
Trademarks [Member] | Spectrum Tracer Services [Member] | |||
Intangibles assets, fair value | $ 1,600 | ||
Estimated useful lives | 10 years | ||
Customer Relationships [Member] | Minimum [Member] | |||
Estimated useful lives | 10 years | 10 years | |
Customer Relationships [Member] | Maximum [Member] | |||
Estimated useful lives | 21 years | 21 years | |
Customer Relationships [Member] | Spectrum Tracer Services [Member] | |||
Intangibles assets, fair value | $ 24,700 | ||
Estimated useful lives | 21 years |
Inventories (Schedule of Invent
Inventories (Schedule of Inventories) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Inventories [Abstract] | ||
Raw materials | $ 2,812 | $ 2,412 |
Work in process | 746 | 623 |
Finished goods | 27,433 | 30,100 |
Total inventories | $ 30,991 | $ 33,135 |
Property and Equipment (Schedul
Property and Equipment (Schedule of Property and Equipment by Major Asset Class) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 31,305 | $ 29,905 |
Less: Accumulated depreciation and amortization | (8,265) | (7,012) |
Property and equipment, net, excluding construction in progress | 23,040 | 22,893 |
Property and equipment, net | 25,691 | 23,651 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 2,071 | 2,167 |
Building and improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 4,989 | 5,155 |
Machinery and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 14,057 | 13,418 |
Computers and software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 2,093 | 2,157 |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 1,042 | 1,013 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 6,809 | 5,751 |
Service equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 244 | 244 |
Construction in progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 2,651 | $ 758 |
Goodwill and Identifiable Int43
Goodwill and Identifiable Intangibles (Changes in Carrying Amount of Goodwill) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Goodwill and Identifiable Intangibles [Abstract] | ||
Goodwill, beginning balance | $ 184,478 | $ 122,077 |
Acquisitions | 55,409 | |
Currency translation adjustment | (4,959) | 6,992 |
Goodwill, ending balance | $ 179,519 | $ 184,478 |
Goodwill and Identifiable Int44
Goodwill and Identifiable Intangibles (Schedule of Identifiable Intangibles) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, Gross Carrying Amount | $ 189,000 | $ 195,079 |
Finite-lived intangible assets, Accumulated Amortization | (62,124) | (58,667) |
Finite-lived intangible assets, Net Balance | 126,876 | 136,412 |
Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, Gross Carrying Amount | 146,283 | 151,433 |
Finite-lived intangible assets, Accumulated Amortization | (56,068) | (52,730) |
Finite-lived intangible assets, Net Balance | $ 90,215 | $ 98,703 |
Technology [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 14 years | 14 years |
Technology [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 16 years | 16 years |
Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, Gross Carrying Amount | $ 1,600 | $ 2,588 |
Finite-lived intangible assets, Accumulated Amortization | (133) | (1,042) |
Finite-lived intangible assets, Net Balance | $ 1,467 | $ 1,546 |
Trademarks [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 5 years | 5 years |
Trademarks [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 10 years | 10 years |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, Gross Carrying Amount | $ 40,458 | $ 41,058 |
Finite-lived intangible assets, Accumulated Amortization | (5,923) | (4,895) |
Finite-lived intangible assets, Net Balance | $ 34,535 | $ 36,163 |
Customer Relationships [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 10 years | 10 years |
Customer Relationships [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 21 years | 21 years |
Internally Developed Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 5 years | |
Finite-lived intangible assets, Gross Carrying Amount | $ 659 | |
Finite-lived intangible assets, Net Balance | $ 659 |
Accrued Expenses (Schedule of A
Accrued Expenses (Schedule of Accrued Expenses) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Accrued Expenses [Abstract] | ||
Accrued payroll and bonus | $ 3,999 | $ 5,167 |
Property and franchise taxes accrual | 200 | 390 |
Accrued acquisition related costs | 25 | |
Accrued other miscellaneous liabilities | 1,093 | 1,091 |
Total Accrued Expenses | $ 5,292 | $ 6,673 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | May 04, 2017 | Feb. 27, 2017 | Apr. 30, 2017 | Feb. 28, 2017 | Jun. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Feb. 16, 2018 | Dec. 31, 2017 | Aug. 31, 2017 |
Debt Instrument [Line Items] | ||||||||||
Amortization expense of deferred financing charges | $ 168,000 | $ 289,000 | ||||||||
Fair Value, Inputs, Level 2 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, fair value | $ 24,500,000 | 24,500,000 | $ 26,700,000 | |||||||
Promissory Note [Member] | Repeat Precision [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, maximum borrowing capacity | $ 3,800,000 | $ 4,300,000 | ||||||||
Long-term debt, gross | 400,000 | $ 400,000 | 3,300,000 | |||||||
Debt maturity date | Feb. 16, 2019 | |||||||||
Promissory Note [Member] | Repeat Precision [Member] | Prime Rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument variable interest rate | 1.00% | |||||||||
Promissory Note [Member] | Repeat Precision [Member] | Maximum [Member] | If Not Paid by Maturity Date [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument stated interest rate | 18.00% | |||||||||
Equipment Notes [Member] | Repeat Precision [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Long-term debt, gross | 500,000 | $ 500,000 | 600,000 | |||||||
Equipment Notes [Member] | Repeat Precision [Member] | February 2017 Note [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument, face amount | $ 800,000 | |||||||||
Debt maturity date | Feb. 27, 2021 | |||||||||
Equipment Notes [Member] | Repeat Precision [Member] | February 2017 Note [Member] | Prime Rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument variable interest rate | 1.00% | |||||||||
Equipment Notes [Member] | Repeat Precision [Member] | April 2017 Note [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Long-term debt, gross | $ 600,000 | $ 600,000 | 700,000 | |||||||
Debt instrument, face amount | $ 800,000 | |||||||||
Debt maturity date | Dec. 21, 2018 | |||||||||
Equipment Notes [Member] | Repeat Precision [Member] | April 2017 Note [Member] | Prime Rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument variable interest rate | 1.00% | |||||||||
Equipment Notes [Member] | Repeat Precision [Member] | Maximum [Member] | If Not Paid by Maturity Date [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument stated interest rate | 18.00% | 18.00% | ||||||||
Amended And Restated Credit Agreement [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument stated interest rate | 6.25% | 6.25% | ||||||||
Amended And Restated Credit Agreement [Member] | Revolving Credit U.S. Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 25,000,000 | $ 50,000,000 | ||||||||
Interest expense on debt | $ 400,000 | $ 700,000 | ||||||||
Line of credit outstanding | 20,000,000 | 20,000,000 | 20,000,000 | |||||||
Amended And Restated Credit Agreement [Member] | Revolving Credit Canadian Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | 25,000,000 | |||||||||
Line of credit outstanding | 0 | 0 | $ 0 | |||||||
Amended And Restated Credit Agreement [Member] | Letter of Credit [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | 5,000,000 | |||||||||
Amended And Restated Credit Agreement [Member] | Swingline Loans [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Maximum borrowing capacity | $ 5,000,000 | |||||||||
Amended And Restated Credit Agreement [Member] | Commencing on Quarter Ending June 30, 2017 through Quarter Ending Prior to March 31, 2018 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Leverage ratio | 3.00% | |||||||||
Amended And Restated Credit Agreement [Member] | Commencing on Quarter Ending June 30, 2017 through Quarter Ending on or After March 31, 2018 [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Leverage ratio | 2.50% | |||||||||
Amended And Restated Credit Agreement [Member] | Commencing on Quarter Ending June 30, 2017 through Last Day of Each Fiscal Quarter [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest coverage ratio | 2.75% | |||||||||
Amended And Restated Credit Agreement [Member] | If Leverage Ratio as of End of Any Fiscal Quarter is Greater than 2.00 to 1.00 and Amount Outstanding Under U.S. Facility at Any Time During such Fiscal Quarter was Greater than $0 [Member] | Revolving Credit U.S. Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Asset coverage ratio | 1.00% | |||||||||
Amended And Restated Credit Agreement [Member] | If Leverage Ratio as of End of Any Fiscal Quarter is Greater than 2.00 to 1.00 and the Amount Outstanding Under the Canadian Facility at Any Time During such Fiscal Quarter was Greater than $0 [Member] | Revolving Credit Canadian Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Asset coverage ratio | 1.00% | |||||||||
Amended And Restated Credit Agreement [Member] | Minimum [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Leverage ratio | 2.00% | |||||||||
Amended And Restated Credit Agreement [Member] | Minimum [Member] | US And Canadian Base Rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument variable interest rate | 2.25% | |||||||||
Amended And Restated Credit Agreement [Member] | Minimum [Member] | Eurocurrency Rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument variable interest rate | 3.25% | |||||||||
Amended And Restated Credit Agreement [Member] | Maximum [Member] | US And Canadian Base Rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument variable interest rate | 3.00% | |||||||||
Amended And Restated Credit Agreement [Member] | Maximum [Member] | Eurocurrency Rate [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument variable interest rate | 4.00% | |||||||||
Amended And Restated Credit Agreement [Member] | Senior Secured Credit Facility [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt issuance cost | $ 1,000,000 | |||||||||
Amortization expense of deferred financing charges | $ 100,000 | $ 200,000 | ||||||||
Credit facility maturity date | May 4, 2020 |
Debt (Schedule of Long-term Deb
Debt (Schedule of Long-term Debt) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Total debt, net | $ 25,041 | $ 27,036 |
Less: current portion | (2,801) | (5,334) |
Long-term debt | 22,240 | 21,702 |
Senior Secured Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt and capital lease obligations | 20,000 | 20,000 |
Promissory Note [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt and capital lease obligations | 448 | 3,313 |
Equipment Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt and capital lease obligations | 1,133 | 1,295 |
Capital Leases [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt and capital lease obligations | $ 3,460 | $ 2,428 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) $ in Millions | Mar. 03, 2017USD ($) |
Commitments and Contingencies [Abstract] | |
Proceeds from an arbitration case | $ 0.9 |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) | Feb. 14, 2018shares | Apr. 30, 2017 | Jun. 30, 2018item$ / sharesshares | Dec. 31, 2017$ / sharesshares |
Stockholders' Equity [Abstract] | ||||
Voting rights entitled for each common stockholders | The holders of common stock are entitled to one vote for each share of common stock held. | |||
Preferred stock voting rights, description | The holder, Cemblend Systems, Inc. ("Cemblend"), of the one share of preferred stock, designated as the "Special Voting Share" in our amended and restated certificate of incorporation, is entitled to vote on all matters that a holder of common stock is entitled to vote on and is entitled to cast a number of votes equal to the number of exchangeable shares of NCS Multistage, Inc. ("NCS Canada"), a subsidiary of the Company, then outstanding that are not owned by us, multiplied by the exchange ratio (as defined in the articles of incorporation of NCS Canada), which was adjusted from one to three in April 2017 in connection with our stock split. | |||
Voting right for each share of common stock held | item | 1 | |||
Common stock issuable for the exchangeable shares | 1,326,935 | 1,769,247 | ||
Shares of common stock issued to Cemblend in exchange for shares of NCS Canada | 442,312 | |||
Stock split ratio of outstanding shares of common stock | 3 | |||
Dividends declared | $ / shares | $ 0 | $ 0 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Allocated share-based compensation expense | $ 3 | $ 1.5 | $ 5.3 | $ 1.8 | |
Restricted Stock Units (RSUs) [Member] | |||||
Share-based compensation shares granted | 582,184 | ||||
Weighted average grant date fair value | $ 14.54 | ||||
Restricted Stock Units (RSUs) [Member] | Minimum [Member] | |||||
Share-based compensation vesting period | 3 years | ||||
Restricted Stock Units (RSUs) [Member] | Non-Employee Board Of Directors [Member] | |||||
Share-based compensation vesting period | 1 year | ||||
Restricted Stock Units (RSUs) [Member] | Vest Over Three Years [Member] | |||||
Share-based compensation shares granted | 536,014 | ||||
Restricted Stock Units (RSUs) [Member] | Vest on One Year Anniversary [Member] | Non-Employee Board Of Directors [Member] | |||||
Share-based compensation shares granted | 46,170 | ||||
Performance Stock Unit Awards (“PSUs”) [Member] | |||||
Share-based compensation shares granted | 156,516 | ||||
Weighted average grant date fair value | $ 17.37 | ||||
Share-based compensation award vesting period | 3 years | ||||
Performance Stock Unit Awards (“PSUs”) [Member] | Performance period from January 1, 2018 to December 31, 2020 [Member] | Maximum [Member] | |||||
Percentage of vesting of share-based compensation awards | 200.00% |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Income Taxes [Abstract] | |||||
Income tax (benefit) expense | $ (1,019,000) | $ (855,000) | $ (74,000) | $ 1,245,000 | |
Effective tax rate | (26.60%) | (15.30%) | (0.80%) | 43.70% | |
Tax benefit from exercise of stock option awards | $ 300,000 | ||||
Provisional tax benefit for impact of the Tax Act of 2017 | $ 500,000 | $ 2,600,000 | |||
Statutory corporate tax rate | 21.00% | 35.00% | |||
Reduction in effective income tax rate continuing operations | 13.10% | 29.10% | |||
Income tax interest and penalties | $ 46,000 | $ 2,000 |
(Loss) Earnings Per Common Sh52
(Loss) Earnings Per Common Share (Reconciliation of Numerator and Denominator for Calculating (Loss) Earnings Per Share from Net (Loss) Income) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator—Basic | ||||
Net (loss) income | $ (2,818) | $ (4,745) | $ 9,047 | $ 1,603 |
Less: income attributable to participating shares | 282 | 74 | ||
Less: income (loss) attributable to non-controlling interest | 1,235 | (254) | 2,122 | (456) |
Net (loss) income attributable to NCS Multistage Holdings, Inc.—Basic | (4,053) | (4,491) | 6,643 | 1,985 |
Numerator—Diluted | ||||
Net (loss) income | (2,818) | (4,745) | 9,047 | 1,603 |
Less: income (loss) attributable to non-controlling interest | 1,235 | (254) | 2,122 | (456) |
Net (loss) income attributable to NCS Multistage Holdings, Inc.—Diluted | $ (4,053) | $ (4,491) | $ 6,925 | $ 2,059 |
Denominator | ||||
Basic weighted average number of shares (in shares) | 44,778,000 | 40,198,000 | 44,517,000 | 37,119,000 |
Exchangeable shares for common stock (in shares) | 1,434,000 | 1,803,000 | ||
Dilutive effect of stock options, RSUs, PSUs and ESPP | 1,235,000 | 1,266,000 | ||
Diluted weighted average number of shares (in shares) | 44,778,000 | 40,198,000 | 47,186,000 | 40,188,000 |
(Loss) earnings per common share | ||||
Basic (in dollars per share) | $ (0.09) | $ (0.11) | $ 0.15 | $ 0.05 |
Diluted (in dollars per share) | $ (0.09) | $ (0.11) | $ 0.15 | $ 0.05 |
Potentially dilutive securities excluded as anti-dilutive | 5,040,000 | 3,307,000 | 231,000 |
Segment and Geographic Inform53
Segment and Geographic Information (Narrative) (Details) | 6 Months Ended |
Jun. 30, 2018segment | |
Segment and Geographic Information [Abstract] | |
Number of reportable segments | 1 |