Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 01, 2019 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Registrant Name | TEAM INC | |
Entity Central Index Key | 0000318833 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding (in shares) | 30,364,416 | |
Entity Current Reporting Status | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Current assets: | |||
Cash and cash equivalents | $ 10,268 | $ 18,288 | |
Receivables, net of allowance of $12,582 and $15,182 | [1] | 263,505 | 268,352 |
Inventory | 43,223 | 48,540 | |
Income tax receivable | 3,661 | 331 | |
Prepaid expenses and other current assets | 22,309 | 19,445 | |
Total current assets | 342,966 | 354,956 | |
Property, plant and equipment, net | 192,764 | 194,794 | |
Intangible assets, net of accumulated amortization of $92,993 and $82,406 | 120,498 | 131,372 | |
Operating lease right-of-use assets | 64,605 | ||
Goodwill | 280,670 | 281,650 | |
Other assets, net | 7,304 | 7,397 | |
Deferred income taxes | 6,613 | 7,652 | |
Total assets | 1,015,420 | 977,821 | |
Current liabilities: | |||
Current portion of long-term debt and finance lease obligations | 4,033 | 569 | |
Current portion of operating lease obligations | 17,036 | ||
Accounts payable | 49,955 | 44,074 | |
Other accrued liabilities | 94,689 | 95,308 | |
Total current liabilities | 165,713 | 139,951 | |
Deferred income taxes | 5,388 | 6,106 | |
Long-term debt and finance lease obligations | 341,684 | 356,814 | |
Operating lease obligations | 52,235 | ||
Defined benefit pension liability | 8,888 | 10,940 | |
Other long-term liabilities | 1,853 | 6,910 | |
Total liabilities | 575,761 | 520,721 | |
Commitments and contingencies | |||
Equity: | |||
Preferred stock, 500,000 shares authorized, none issued | 0 | 0 | |
Common stock, par value $0.30 per share, 60,000,000 shares authorized; 30,339,999 and 30,184,330 shares issued, respectively | 9,100 | 9,053 | |
Additional paid-in capital | 408,837 | 400,989 | |
Retained earnings | 55,824 | 81,450 | |
Accumulated other comprehensive loss | (34,102) | (34,392) | |
Total equity | 439,659 | 457,100 | |
Total liabilities and equity | $ 1,015,420 | $ 977,821 | |
[1] | Includes billed and unbilled amounts, net of allowance for doubtful accounts. See Note 3 for details. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Receivables, allowance | $ 12,582 | $ 15,182 |
Intangible assets, accumulated amortization | $ 92,993 | $ 82,406 |
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.30 | $ 0.30 |
Common stock, shares authorized (in shares) | 60,000,000 | 60,000,000 |
Common stock, shares issued (in shares) | 30,339,999 | 30,184,330 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Income Statement [Abstract] | |||||
Revenues | [1] | $ 290,079 | $ 290,856 | $ 875,507 | $ 937,130 |
Operating expenses | 207,044 | 220,717 | 631,928 | 694,275 | |
Gross margin | 83,035 | 70,139 | 243,579 | 242,855 | |
Selling, general and administrative expenses | 84,647 | 87,786 | 248,507 | 270,619 | |
Restructuring and other related charges, net | 228 | 2,047 | 436 | 4,458 | |
Gain on revaluation of contingent consideration | 0 | 0 | 0 | (202) | |
Operating income (loss) | (1,840) | (19,694) | (5,364) | (32,020) | |
Interest expense, net | 7,647 | 8,022 | 22,658 | 23,250 | |
Loss on convertible debt embedded derivative (see Note 8) | 0 | 0 | 0 | 24,783 | |
Other expense, net | 116 | 123 | 371 | 455 | |
Income (loss) before income taxes | (9,603) | (27,839) | (28,393) | (80,508) | |
Less: Provision (benefit) for income taxes | (2,546) | (4,313) | (3,210) | (13,377) | |
Net income (loss) | $ (7,057) | $ (23,526) | $ (25,183) | $ (67,131) | |
Earnings (loss) per common share: | |||||
Basic (in dollars per share) | $ (0.23) | $ (0.78) | $ (0.83) | $ (2.24) | |
Diluted (in dollars per share) | $ (0.23) | $ (0.78) | $ (0.83) | $ (2.24) | |
[1] | Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ (7,057) | $ (23,526) | $ (25,183) | $ (67,131) |
Other comprehensive income (loss) before tax: | ||||
Foreign currency translation adjustment | (2,954) | 516 | (473) | (4,419) |
Foreign currency hedge | 556 | 97 | 651 | 464 |
Other comprehensive income (loss), before tax | (2,398) | 613 | 178 | (3,955) |
Tax (provision) benefit attributable to other comprehensive income (loss) | (148) | 202 | 112 | 992 |
Other comprehensive income (loss), net of tax | (2,546) | 815 | 290 | (2,963) |
Total comprehensive income (loss) | $ (9,603) | $ (22,711) | $ (24,893) | $ (70,094) |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Shares | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | |
Beginning balance (in shares) at Dec. 31, 2017 | 29,953 | |||||
Beginning balance at Dec. 31, 2017 | $ 477,174 | $ 8,984 | $ 352,500 | $ 135,486 | $ (19,796) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Adoption of new accounting principle, net of tax | 6,780 | 6,780 | ||||
Net income (loss) | (12,264) | (12,264) | ||||
Foreign currency translation adjustment, net of tax | (2) | (2) | ||||
Foreign currency hedge, net of tax | (315) | (315) | ||||
Non-cash compensation | 2,420 | 2,420 | ||||
Vesting of stock awards (in shares) | 34 | |||||
Vesting of stock awards | (225) | $ 10 | (235) | |||
Ending balance (in shares) at Mar. 31, 2018 | 29,987 | |||||
Ending Balance at Mar. 31, 2018 | 473,568 | $ 8,994 | 354,685 | 130,002 | (20,113) | |
Beginning balance (in shares) at Dec. 31, 2017 | 29,953 | |||||
Beginning balance at Dec. 31, 2017 | 477,174 | $ 8,984 | 352,500 | 135,486 | (19,796) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (67,131) | |||||
Ending balance (in shares) at Sep. 30, 2018 | 30,023 | |||||
Ending Balance at Sep. 30, 2018 | 460,544 | $ 9,005 | 399,163 | 75,135 | (22,759) | |
Beginning balance (in shares) at Mar. 31, 2018 | 29,987 | |||||
Beginning balance at Mar. 31, 2018 | 473,568 | $ 8,994 | 354,685 | 130,002 | (20,113) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (31,341) | (31,341) | ||||
Foreign currency translation adjustment, net of tax | (4,041) | (4,041) | ||||
Foreign currency hedge, net of tax | 580 | 580 | ||||
Issuance of convertible debt, net of tax | 37,540 | 37,540 | ||||
Non-cash compensation | 4,585 | 4,585 | ||||
Vesting of stock awards (in shares) | 32 | |||||
Vesting of stock awards | 0 | $ 10 | (10) | |||
Ending balance (in shares) at Jun. 30, 2018 | 30,019 | |||||
Ending Balance at Jun. 30, 2018 | 480,891 | $ 9,004 | 396,800 | 98,661 | (23,574) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (23,526) | (23,526) | ||||
Foreign currency translation adjustment, net of tax | 733 | 733 | ||||
Foreign currency hedge, net of tax | 82 | 82 | ||||
Non-cash compensation | 2,408 | 2,408 | ||||
Vesting of stock awards (in shares) | 4 | |||||
Vesting of stock awards | (44) | $ 1 | (45) | |||
Ending balance (in shares) at Sep. 30, 2018 | 30,023 | |||||
Ending Balance at Sep. 30, 2018 | 460,544 | $ 9,005 | 399,163 | 75,135 | (22,759) | |
Beginning balance (in shares) at Dec. 31, 2018 | 30,184 | |||||
Beginning balance at Dec. 31, 2018 | 457,100 | $ 9,053 | 400,989 | 81,450 | (34,392) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Adoption of new accounting principle, net of tax | (767) | (767) | ||||
Net income (loss) | (24,228) | (24,228) | ||||
Foreign currency translation adjustment, net of tax | 1,809 | 1,809 | ||||
Foreign currency hedge, net of tax | 210 | 210 | ||||
Non-cash compensation | 2,434 | 2,434 | ||||
Vesting of stock awards (in shares) | 63 | |||||
Vesting of stock awards | (341) | $ 19 | (360) | |||
Ending balance (in shares) at Mar. 31, 2019 | 30,247 | |||||
Ending Balance at Mar. 31, 2019 | 436,217 | $ 9,072 | 403,063 | 56,455 | (32,373) | |
Beginning balance (in shares) at Dec. 31, 2018 | 30,184 | |||||
Beginning balance at Dec. 31, 2018 | 457,100 | $ 9,053 | 400,989 | 81,450 | (34,392) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (25,183) | |||||
Ending balance (in shares) at Sep. 30, 2019 | 30,340 | |||||
Ending Balance at Sep. 30, 2019 | 439,659 | $ 9,100 | 408,837 | 55,824 | (34,102) | |
Beginning balance (in shares) at Mar. 31, 2019 | 30,247 | |||||
Beginning balance at Mar. 31, 2019 | 436,217 | $ 9,072 | 403,063 | 56,455 | (32,373) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 6,102 | 6,102 | ||||
Foreign currency translation adjustment, net of tax | 1,005 | 1,005 | ||||
Foreign currency hedge, net of tax | (188) | (188) | ||||
Non-cash compensation | 3,648 | 3,648 | ||||
Vesting of stock awards (in shares) | 46 | |||||
Vesting of stock awards | (9) | $ 14 | (23) | |||
Other | [1] | 324 | 324 | |||
Ending balance (in shares) at Jun. 30, 2019 | 30,293 | |||||
Ending Balance at Jun. 30, 2019 | 447,099 | $ 9,086 | 406,688 | 62,881 | (31,556) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (7,057) | (7,057) | ||||
Foreign currency translation adjustment, net of tax | (3,014) | (3,014) | ||||
Foreign currency hedge, net of tax | 468 | 468 | ||||
Non-cash compensation | 2,588 | 2,588 | ||||
Vesting of stock awards (in shares) | 47 | |||||
Vesting of stock awards | (425) | $ 14 | (439) | |||
Ending balance (in shares) at Sep. 30, 2019 | 30,340 | |||||
Ending Balance at Sep. 30, 2019 | $ 439,659 | $ 9,100 | $ 408,837 | $ 55,824 | $ (34,102) | |
[1] | Amount reflects a revision of tax effects for the adoption of ASC 842. Further discussion on the effects of adoption are set forth in Note 1. |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | ||
Cash flows from operating activities: | |||
Net loss | $ (25,183) | $ (67,131) | |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 36,700 | 48,466 | |
Amortization of deferred loan costs and debt discounts | 5,691 | 5,208 | |
Provision for doubtful accounts | (440) | 9,432 | |
Foreign currency (gain) loss | 348 | 1,457 | |
Deferred income taxes | 261 | (14,319) | |
Gain on revaluation of contingent consideration | 0 | (202) | |
(Gain) loss on asset disposal | (137) | (900) | |
Loss on convertible debt embedded derivative | 0 | 24,783 | |
Non-cash compensation cost | 8,670 | 9,414 | |
Other, net | (1,398) | (2,911) | |
(Increase) decrease: | |||
Receivables | 4,384 | (11,409) | |
Inventory | 5,030 | (2,632) | |
Prepaid expenses and other current assets | (3,490) | 1,544 | |
Increase (decrease): | |||
Accounts payable | 4,537 | (6,560) | |
Other accrued liabilities | 1,005 | 10,058 | |
Income taxes | (2,959) | 1,004 | |
Net cash provided by (used in) operating activities | 33,019 | 5,302 | |
Cash flows from investing activities: | |||
Capital expenditures | [1] | (23,199) | (19,394) |
Proceeds from disposal of assets | 802 | 1,464 | |
Other | 38 | (462) | |
Net cash used in investing activities | (22,359) | (18,392) | |
Cash flows from financing activities: | |||
Net borrowings (payments) under revolving credit agreement | (64,886) | 6,370 | |
Borrowings under term loan, net of debt discount | 49,745 | 0 | |
Contingent consideration payments | (428) | (1,106) | |
Debt issuance costs on Credit Facility | (1,475) | (855) | |
Payments related to withholding tax for share-based payment arrangements | (776) | (269) | |
Other | (230) | 0 | |
Net cash provided by (used in) financing activities | (18,050) | 4,140 | |
Effect of exchange rate changes on cash | (630) | (1,647) | |
Net decrease in cash and cash equivalents | (8,020) | (10,597) | |
Cash and cash equivalents at end of period | 18,288 | 26,552 | |
Cash and cash equivalents at beginning of period | $ 10,268 | $ 15,955 | |
[1] | Excludes accrued capital expenditures for the nine months ended September 30, 2019 only. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES Description of business. Unless otherwise indicated, the terms “Team, Inc.,” “Team,” “the Company,” “we,” “our” and “us” are used in this report to refer to Team, Inc., to one or more of our consolidated subsidiaries or to all of them taken as a whole. We are a leading global provider of specialized industrial services, including inspection, engineering assessment and mechanical repair and remediation required in maintaining high temperature and high pressure piping systems and vessels that are utilized extensively in the refining, petrochemical, power, pipeline, aerospace and other heavy industries. We conduct operations in three segments: Inspection and Heat Treating (“IHT”), Mechanical Services (“MS”) and Quest Integrity (“Quest Integrity”). Through the capabilities and resources in these three segments, we believe that Team is uniquely qualified to provide integrated solutions involving in their most basic form: inspection to assess condition, engineering assessment to determine fitness for purpose in the context of industry standards and regulatory codes and mechanical services to repair, rerate or replace based upon the client’s election. In addition, our Company is capable of escalating with the client’s needs—as dictated by the severity of the damage found and the related operating conditions—from standard services to some of the most advanced services and integrated integrity management and asset reliability solutions available in the industry. We also believe that Team is unique in its ability to provide services in three distinct client demand profiles: (i) turnaround or project services, (ii) call-out services and (iii) nested or run-and-maintain services. IHT provides standard and advanced non-destructive testing (“NDT”) services for the process, pipeline and power sectors, pipeline integrity management services, field heat treating services, as well as associated engineering and assessment services. These services can be offered while facilities are running (on-stream), during facility turnarounds or during new construction or expansion activities. MS provides primarily call-out and turnaround services under both on-stream and off-line/shut down circumstances. Turnaround services are project-related and demand is a function of the number and scope of scheduled and unscheduled facility turnarounds as well as new industrial facility construction or expansion activities. The turnaround and call-out services MS provides include field machining, technical bolting, field valve repair and isolation test plugging services. On-stream services offered by MS represent the services offered while plants are operating and under pressure. These services include leak repair, fugitive emissions control and hot tapping. Quest Integrity provides integrity and reliability management solutions for the process, pipeline and power sectors. These solutions encompass three broadly-defined disciplines: (1) highly specialized in-line inspection services for unpiggable process piping and pipelines using proprietary in-line inspection tools and analytical software, (2) advanced engineering and condition assessment services through a multi-disciplined engineering team and (3) advanced digital imaging including remote digital video imaging, laser scanning and laser profilometry-enabled reformer care services. We offer these services globally through over 200 locations in 20 countries throughout the world with approximately 6,900 employees. We market our services to companies in a diverse array of heavy industries which include the petrochemical, refining, power, pipeline, steel, pulp and paper industries, as well as municipalities, shipbuilding, original equipment manufacturers (“OEMs”), distributors, and some of the world’s largest engineering and construction firms. Basis for presentation. These interim financial statements are unaudited, but in the opinion of our management, reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of results for such periods. The condensed consolidated balance sheet at December 31, 2018 is derived from the December 31, 2018 audited consolidated financial statements. The results of operations for any interim period are not necessarily indicative of results for the full year. Certain disclosures have been condensed or omitted from the interim financial statements included in this report. Therefore, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on March 19, 2019 (“the 2018 Form 10K”). Use of estimates. Our accounting policies conform to Generally Accepted Accounting Principles in the United States (“GAAP”). The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect our reported financial position and results of operations. We review significant estimates and judgments affecting our consolidated financial statements on a recurring basis and record the effect of any necessary adjustments prior to their publication. Estimates and judgments are based on information available at the time such estimates and judgments are made. Adjustments made with respect to the use of these estimates and judgments often relate to information not previously available. Uncertainties with respect to such estimates and judgments are inherent in the preparation of financial statements. Estimates and judgments are used in, among other things, (1) aspects of revenue recognition, (2) valuation of acquisition related tangible and intangible assets and assessments of all long-lived assets for possible impairment, (3) estimating various factors used to accrue liabilities for workers’ compensation, auto, medical and general liability, (4) establishing an allowance for uncollectible accounts receivable, (5) estimating the useful lives of our assets, (6) assessing future tax exposure and the realization of tax assets, (7) the valuation of the embedded derivative liability in our convertible debt, (8) selecting assumptions used in the measurement of costs and liabilities associated with defined benefit pension plans and (9) managing our foreign currency risk with certain debt obligations associated with net investments in foreign operations. Fair value of financial instruments . Our financial instruments consist primarily of cash, cash equivalents, accounts receivable, accounts payable and debt obligations. The carrying amount of cash, cash equivalents, trade accounts receivable and trade accounts payable are representative of their respective fair values due to the short-term maturity of these instruments. The fair value of our credit facility is representative of the carrying value based upon the variable terms and management’s opinion that the current rates available to us with the same maturity and security structure are equivalent to that of the banking facility. The fair value of our convertible senior notes as of September 30, 2019 and December 31, 2018 is $254.6 million and $231.5 million , respectively (inclusive of the fair value of the conversion option) and is a “Level 2” (as defined in Note 11) measurement, determined based on the observed trading price of these instruments. Goodwill and intangible assets. Goodwill and intangible assets acquired in a business combination and determined to have an indefinite useful life are not amortized, but are instead tested for impairment at least annually in accordance with the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350 Intangibles—Goodwill and Other (“ASC 350”). Intangible assets with estimated useful lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed for impairment in accordance with ASC 350. We assess goodwill for impairment at the reporting unit level, which we have determined to be the same as our operating segments. Each reporting unit has goodwill relating to past acquisitions. Our goodwill annual test date is December 1. We measure goodwill impairment losses as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. We performed our most recent annual impairment test as of December 1, 2018 and concluded that there was no impairment based upon a qualitative assessment to determine if it was more likely than not (that is, a likelihood of more than 50 percent) that the fair values of the reporting units were less than their respective carrying values as of the reporting date. There have been no events that have required an interim assessment of the carrying value of goodwill during 2019. There was $280.7 million of goodwill at September 30, 2019 and $281.7 million at December 31, 2018 . A rollforward of goodwill for the nine months ended September 30, 2019 is as follows (in thousands): Nine Months Ended (unaudited) IHT MS Quest Integrity Total Balance at beginning of period $ 192,608 $ 55,627 $ 33,415 $ 281,650 Foreign currency adjustments 178 (613 ) (545 ) (980 ) Balance at end of period $ 192,786 $ 55,014 $ 32,870 $ 280,670 There was $75.2 million of accumulated impairment losses at September 30, 2019 and December 31, 2018 , comprised of $21.1 million and $54.1 million for IHT and MS, respectively, which relate to impairment losses recognized in the third quarter of 2017. Allowance for doubtful accounts. In the ordinary course of business, a portion of our accounts receivable are not collected due to billing disputes, customer bankruptcies, dissatisfaction with the services we performed and other various reasons. We establish an allowance to account for those accounts receivable that we estimate will eventually be deemed uncollectible. The allowance for doubtful accounts is based on a combination of our historical experience and management’s review of long outstanding accounts receivable. Concentration of credit risk. No single customer accounts for more than 10% of consolidated revenues. Earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) available to Team stockholders by the weighted-average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing net income (loss) available to Team stockholders by the sum of (1) the weighted-average number of shares of common stock outstanding during the period, (2) the dilutive effect of the assumed exercise of share-based compensation using the treasury stock method and (3) the dilutive effect of the assumed conversion of our convertible senior notes under the treasury stock method. The Company’s intent is to settle the principal amount of the convertible senior notes in cash upon conversion. If the conversion value exceeds the principal amount, the Company may elect to deliver shares of its common stock with respect to the remainder of its conversion obligation in excess of the aggregate principal amount (the “conversion spread”). Accordingly, the conversion spread is included in the denominator for the computation of diluted earnings per common share using the treasury stock method. Amounts used in basic and diluted earnings (loss) per share, for the three and nine months ended September 30, 2019 and 2018 , are as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Weighted-average number of basic shares outstanding 30,300 30,021 30,267 30,000 Stock options, stock units and performance awards — — — — Convertible Senior Notes — — — — Total shares and dilutive securities 30,300 30,021 30,267 30,000 For both the three and nine months ended September 30, 2019 and 2018 , all outstanding share-based compensation awards were excluded from the calculation of diluted loss per share because their inclusion would be antidilutive due to the net loss in those periods. Also, for both the three and nine months ended September 30, 2019 and 2018 , the convertible senior notes were excluded from diluted loss per share because the conversion price exceeded the average price of our common stock during those periods. For information on our convertible senior notes and our share-based compensation awards, refer to Note 8 and Note 12, respectively. Revision to prior period consolidated financial statements. As noted in the previously issued 2018 Form 10-K, the Company identified errors in its previously issued 2018 unaudited condensed consolidated statement of operations for the three and nine months ended September 30, 2018 . These prior period errors are related to the measurement of valuation allowances on deferred tax assets. The prior period condensed consolidated financial statements and other affected prior period financial information have been revised to correct these errors. The effect of correcting the errors decreased our income tax benefit and unfavorably impacted our net loss by $0.7 million for the three months ended September 30, 2018, but increased our income tax benefit and favorably impacted our net loss by $6.0 million for the nine months ended September 30, 2018. Based on an analysis of quantitative and qualitative factors, the Company determined the related impacts were not material to its previously filed annual or interim consolidated financial statements, and therefore, amendments of previously filed reports are not required. The table below provides a summary of the financial statement line items which were impacted by these error corrections (in thousands, except per share data): Three Months Ended September 30, 2018 As Previously Reported Adjustments As Revised (unaudited) (unaudited) (unaudited) Effect on condensed consolidated statement of operations Provision (benefit) for income taxes $ (4,977 ) $ 664 $ (4,313 ) Net loss $ (22,862 ) $ (664 ) $ (23,526 ) Loss per common share: Basic $ (0.76 ) (0.02 ) $ (0.78 ) Diluted $ (0.76 ) (0.02 ) $ (0.78 ) Nine Months Ended September 30, 2018 As Previously Reported Adjustments As Revised (unaudited) (unaudited) (unaudited) Effect on condensed consolidated statement of operations Provision (benefit) for income taxes $ (7,331 ) $ (6,046 ) $ (13,377 ) Net loss $ (73,177 ) $ 6,046 $ (67,131 ) Loss per common share: Basic $ (2.44 ) 0.20 $ (2.24 ) Diluted $ (2.44 ) 0.20 $ (2.24 ) Newly Adopted Accounting Principles Topic 842 - Leases. In February 2016, the FASB issued Accounting Standard Update No. 2016-02, Leases (“ASU 2016-02”), which establishes Accounting Standards Codification (“ASC”) Topic 842, Leases (“ASC 842”), replaced previous lease accounting guidance along with subsequent ASUs issued in 2018 to clarify certain provisions of ASU 2016-02. ASC 842 changes the accounting for leases, including a requirement to record leases with terms of greater than twelve months on the balance sheet as assets and liabilities. ASC 842 also requires us to expand our financial statement disclosures on leasing activities. We adopted ASC 842 effective January 1, 2019 and elected the modified retrospective transition method, which specified the comparative financial information will not be restated and will continue to be reported under the lease standard in effect during those periods. We elected the “package of practical expedients,” which permits us not to reassess under the new standard our prior conclusions on lease identification, lease classification and initial direct costs. We also elected the short-term lease recognition practical expedient in which leases with a term of 12 months or less will not be recognized on the balance sheet and the practical expedient to not separate lease and non-lease components for the majority of our leases. We did not elect the hindsight practical expedient. The impact of ASC 842 on our consolidated balance sheet beginning January 1, 2019 was the recognition of right-of-use assets and lease liabilities for operating leases, while our accounting for finance leases remained substantially unchanged. The cumulative effect of adoption on January 1, 2019 resulted in a $0.4 million decrease, net of tax, to beginning retained earnings. The adoption of ASC 842 did not result in any material impacts to our statements of operations or statements of cash flows. Amounts recognized at January 1, 2019 for operating leases were as follows (in thousands): January 1, 2019 (unaudited) Operating lease right-of-use assets $ 66,555 Current portion of operating lease obligations 17,770 Operating lease obligations (non-current) 54,477 Accounting Principles Not Yet Adopted ASU No. 2016-13. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), along with subsequent ASUs issued in 2019 to clarify certain provisions of ASU 2016-13, which amends GAAP by introducing a new impairment model for financial instruments that is based on expected credit losses rather than incurred credit losses. The new impairment model applies to most financial assets that are not measured at fair value, including trade accounts receivable. ASU No. 2016-13 is effective for interim and annual periods in fiscal years beginning after December 15, 2019. We plan to adopt this pronouncement for our fiscal year beginning January 1, 2020. We are currently evaluating the impact this ASU will have on our financial statements, but we do not expect such adoption to have a material impact on our results of operations or financial position. ASU No. 2018-15. In August 2018, the FASB issued ASU No. 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Topic 350): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), that requires implementation costs incurred by customers in cloud computing arrangements to be deferred and recognized over the term of the arrangement, if those costs would be capitalized by the customer in a software licensing arrangement under the internal-use software guidance in Topic 350. ASU 2018-15 requires a customer to disclose the nature of its hosting arrangements that are service contracts and provide disclosures as if the deferred implementation costs were a separate, major depreciable asset class. ASU No. 2018-15 will be effective for us as of January 1, 2020. Early adoption is permitted. We are currently evaluating the impact this ASU will have on our financial statements, but we do not expect such adoption to have a material impact on our results of operations, financial position or cash flows. |
REVENUE
REVENUE | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE In accordance with ASC 606, Revenue from Contracts with Customers , we follow a five-step process to recognize revenue: 1) identify the contract with the customer, 2) identify the performance obligations, 3) determine the transaction price, 4) allocate the transaction price to the performance obligations and 5) recognize revenue when the performance obligations are satisfied. Most of our contracts with customers are short-term in nature and billed on a time and materials basis, while certain other contracts are at a fixed price. Certain contracts may contain a combination of fixed and variable elements. We act as a principal and have performance obligations to provide the service itself or oversee the services provided by any subcontractors. Revenue is measured based on consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties, such as taxes assessed by governmental authorities. In contracts where the amount of consideration is variable, we consider our experience with similar contracts in estimating the amount to which we will be entitled and recognize revenues accordingly. As most of our contracts contain only one performance obligation, the allocation of a contract’s transaction price to multiple performance obligations is generally not applicable. Customers are generally billed as we satisfy our performance obligations and payment terms typically range from 30 to 90 days from the invoice date. Billings under certain fixed-price contracts may be based upon the achievement of specified milestones, while some arrangements may require advance customer payment. Our contracts do not include significant financing components since the contracts typically span less than one year. Contracts generally include an assurance type warranty clause to guarantee that the services comply with agreed specifications. The warranty period typically is 12 months or less from the date of service. Warranty expenses were not material for the three and nine months ended September 30, 2019 and 2018 . Revenue is recognized as (or when) the performance obligations are satisfied by transferring control over a service or product to the customer. Revenue recognition guidance prescribes two recognition methods (over time or point in time). Most of our performance obligations qualify for recognition over time because we typically perform our services on customer facilities or assets and customers receive the benefits of our services as we perform. Where a performance obligation is satisfied over time, the related revenue is also recognized over time using the method deemed most appropriate to reflect the measure of progress and transfer of control. For our time and materials contracts, we are generally able to elect the right-to-invoice practical expedient, which permits us to recognize revenue in the amount to which we have a right to invoice the customer if that amount corresponds directly with the value to the customer of our performance completed to date. For our fixed price contracts, we typically recognize revenue using the cost-to-cost method, which measures the extent of progress towards completion based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Under this method, revenue is recognized proportionately as costs are incurred. For contracts where control is transferred at a point in time, revenue is recognized at the time control of the asset is transferred to the customer, which is typically upon delivery and acceptance by the customer. Disaggregation of revenue. Essentially all of our revenues are associated with contracts with customers. A disaggregation of our revenue from contracts with customers by geographic region, by reportable operating segment and by service type is presented below (in thousands): Three Months Ended September 30, 2019 Three Months Ended September 30, 2018 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 121,772 $ 4,607 $ 126,379 $ 143,508 $ 4,021 $ 147,529 MS 101,929 33,696 135,625 80,714 38,297 119,011 Quest Integrity 18,370 9,705 28,075 15,958 8,358 24,316 Total $ 242,071 $ 48,008 $ 290,079 $ 240,180 $ 50,676 $ 290,856 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 379,460 $ 12,633 $ 392,093 $ 456,701 $ 10,920 $ 467,621 MS 296,557 105,491 402,048 292,502 108,388 400,890 Quest Integrity 57,376 23,990 81,366 45,658 22,961 68,619 Total $ 733,393 $ 142,114 $ 875,507 $ 794,861 $ 142,269 $ 937,130 Three Months Ended September 30, 2019 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 102,448 $ 100 $ 16,500 $ 7,331 $ 126,379 MS — 134,096 382 1,147 135,625 Quest Integrity 28,075 — — — 28,075 Total $ 130,523 $ 134,196 $ 16,882 $ 8,478 $ 290,079 Three Months Ended September 30, 2018 (unaudited) Non-Destructive Evaluation and Testing Services 1 Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 119,088 $ 3,194 $ 17,019 $ 8,228 $ 147,529 MS 85 117,147 818 961 119,011 Quest Integrity 24,316 — — — 24,316 Total $ 143,489 $ 120,341 $ 17,837 $ 9,189 $ 290,856 _________________ 1 This service type is inclusive of the “Asset Integrity Management” and “Non-Destructive Evaluation” service types as disclosed in the Form 10-Q for the third quarter of 2018. Nine Months Ended September 30, 2019 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 313,375 $ 598 $ 52,804 $ 25,316 $ 392,093 MS — 396,493 2,041 3,514 402,048 Quest Integrity 81,366 — — — 81,366 Total $ 394,741 $ 397,091 $ 54,845 $ 28,830 $ 875,507 Nine Months Ended September 30, 2018 (unaudited) Non-Destructive Evaluation and Testing Services 1 Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 376,244 $ 9,077 $ 58,774 $ 23,526 $ 467,621 MS 240 394,521 1,761 4,368 400,890 Quest Integrity 68,619 — — — 68,619 Total $ 445,103 $ 403,598 $ 60,535 $ 27,894 $ 937,130 _________________ 1 This service type is inclusive of the “Asset Integrity Management” and “Non-Destructive Evaluation” service types as disclosed in the Form 10-Q for the third quarter of 2018. For additional information on our reportable operating segments and geographic information, refer to Note 15. Contract balances. The timing of revenue recognition, billings and cash collections results in trade accounts receivable, contract assets and contract liabilities on the consolidated balance sheets. Trade accounts receivable include billed and unbilled amounts currently due from customers and represent unconditional rights to receive consideration. The amounts due are stated at their net estimated realizable value. Refer to Notes 1 and 3 for additional information on our trade receivables and the allowance for doubtful accounts. Contract assets include unbilled amounts typically resulting from sales under fixed-price contracts when the cost-to-cost method of revenue recognition is utilized, the revenue recognized exceeds the amount billed to the customer and the right to payment is conditional on something other than the passage of time. Amounts may not exceed their net realizable value. If we receive advances or deposits from our customers, a contract liability is recorded. Additionally, a contract liability arises if items of variable consideration result in less revenue being recorded than what is billed. Contract assets and contract liabilities are generally classified as current. The following table provides information about trade accounts receivable, contract assets and contract liabilities as of September 30, 2019 and December 31, 2018 (in thousands): September 30, 2019 December 31, 2018 (unaudited) Trade accounts receivable, net 1 $ 263,505 $ 268,352 Contract assets 2 $ 6,224 $ 5,745 Contract liabilities 3 $ 1,181 $ 1,784 _________________ 1 Includes billed and unbilled amounts, net of allowance for doubtful accounts. See Note 3 for details. 2 Included in the “Prepaid expenses and other current assets” line on the condensed consolidated balance sheets. 3 Included in the “Other accrued liabilities” line of the condensed consolidated balance sheets. The $0.5 million increase in our contract assets from December 31, 2018 to September 30, 2019 is due to more fixed price contracts in progress at September 30, 2019 as compared to December 31, 2018 . Contract liabilities as of September 30, 2019 have decreased as compared to December 31, 2018 due to our completion of performance obligations during the year ended December 31, 2018 associated with contracts under which customers had paid for all or a portion of the consideration in advance of the work being performed. Due to the short-term nature of our contracts, contract liability balances as of the end of any period are generally recognized as revenue in the following quarter. Accordingly, essentially all of the contract liability balance at December 31, 2018 was recognized as revenue during the subsequent quarter. Contract costs. The Company recognizes the incremental costs of obtaining contracts as selling, general and administrative expenses when incurred if the amortization period of the asset that otherwise would have been recognized is one year or less. Assets recognized for costs to obtain a contract were not material as of September 30, 2019 . Costs to fulfill a contract are recorded as assets if they relate directly to a contract or a specific anticipated contract, the costs generate or enhance resources that will be used in satisfying performance obligations in the future and the costs are expected to be recovered. Costs to fulfill a contract recognized as assets primarily consist of labor and materials costs and generally relate to engineering and set-up costs incurred prior to the satisfaction of performance obligations begins. Assets recognized for costs to fulfill a contract are included in the “Prepaid expenses and other current assets” line of the condensed consolidated balance sheets and were not material as of September 30, 2019 . Such assets are recognized as expenses as we transfer the related goods or services to the customer. All other costs to fulfill a contract are expensed as incurred. Remaining performance obligations. As of September 30, 2019 , there were no material amounts of remaining performance obligations that are required to be disclosed. As permitted by ASC 606, we have elected not to disclose information about remaining performance obligations where i) the performance obligation is part of a contract that has an original expected duration of one year or less or ii) when we recognize revenue from the satisfaction of the performance obligation in accordance with the right-to-invoice practical expedient. |
RECEIVABLES
RECEIVABLES | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
RECEIVABLES | RECEIVABLES A summary of accounts receivable as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Trade accounts receivable $ 178,745 $ 207,266 Unbilled receivables 97,342 76,268 Allowance for doubtful accounts (12,582 ) (15,182 ) Total $ 263,505 $ 268,352 |
INVENTORY
INVENTORY | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY A summary of inventory as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Raw materials $ 8,031 $ 8,448 Work in progress 3,862 3,900 Finished goods 31,330 36,192 Total $ 43,223 $ 48,540 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT A summary of property, plant and equipment as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Land $ 6,360 $ 6,376 Buildings and leasehold improvements 58,375 57,006 Machinery and equipment 277,692 269,084 Furniture and fixtures 10,703 10,253 Capitalized Enterprise Resource Planning system development costs 46,637 46,637 Computers and computer software 22,008 15,826 Automobiles 4,638 4,879 Construction in progress 11,777 6,550 Total 438,190 416,611 Accumulated depreciation and amortization (245,426 ) (221,817 ) Property, plant and equipment, net $ 192,764 $ 194,794 Included in the table above are assets under finance leases of $5.2 million as of both September 30, 2019 and December 31, 2018, net of accumulated amortization. Depreciation expense for the three months ended September 30, 2019 and 2018 was $8.4 million and $8.9 million , respectively. Depreciation expense for the nine months ended September 30, 2019 and 2018 was $25.7 million and $27.1 million , respectively. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS A summary of intangible assets as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 174,727 $ (60,440 ) $ 114,287 $ 174,894 $ (51,160 ) $ 123,734 Non-compete agreements 5,414 (5,174 ) 240 5,433 (4,882 ) 551 Trade names 24,679 (20,983 ) 3,696 24,753 (20,594 ) 4,159 Technology 7,827 (5,775 ) 2,052 7,847 (5,187 ) 2,660 Licenses 844 (621 ) 223 851 (583 ) 268 Total $ 213,491 $ (92,993 ) $ 120,498 $ 213,778 $ (82,406 ) $ 131,372 Amortization expense on intangible assets for the three months ended September 30, 2019 and September 30, 2018 was $3.6 million and $7.1 million , respectively. Amortization expense on intangible assets for the nine months ended September 30, 2019 and 2018 was $11.0 million and $21.4 million , respectively. |
OTHER ACCRUED LIABILITIES
OTHER ACCRUED LIABILITIES | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
OTHER ACCRUED LIABILITIES | OTHER ACCRUED LIABILITIES A summary of other accrued liabilities as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Payroll and other compensation expenses $ 59,040 $ 47,988 Insurance accruals 13,400 16,001 Property, sales and other non-income related taxes 5,688 7,271 Lease commitments 35 1,145 Contract liabilities 1,181 1,784 Accrued commission 3,341 2,290 Accrued interest 2,138 5,261 Volume discount 3,811 4,322 Contingent consideration — 429 Professional fees 1,350 1,219 Other 4,705 7,598 Total $ 94,689 $ 95,308 |
LONG-TERM DEBT, LETTERS OF CRED
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES | LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES As of September 30, 2019 and December 31, 2018 , our long-term debt is summarized as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Credit Facility revolver $ 90,674 $ 156,843 Credit Facility term loan 1 49,691 — Total Credit Facility 140,365 156,843 Convertible debt 2 199,963 195,184 Finance lease obligations 5,389 5,356 Total long-term debt and finance lease obligations 345,717 357,383 Less: current portion of long-term debt and finance lease obligations 4,033 569 Total long-term debt and finance lease obligations, less current portion $ 341,684 $ 356,814 _________________ 1 Comprised of principal amount outstanding, less unamortized discount and issuance costs. 2 Comprised of principal amount outstanding, less unamortized discount and issuance costs. See Convertible Debt section below for additional information. Credit Facility On August 30, 2019, we renewed our banking credit facility (the “Credit Facility”) under the eighth amendment (the “Eighth Amendment”) to the Third Amended and Restated Credit Agreement. The Eighth Amendment amends and restates certain portions of the Third Amended and Restated Credit Agreement, dated as of July 7, 2015. In accordance with the Eighth Amendment, the Credit Facility has a borrowing capacity of up to $275.0 million and consists of a $225.0 million revolving loan facility and a $50.0 million term loan facility. The entire $50.0 million term loan amount was used to pay the outstanding principal amount borrowed under the Credit Facility prior to the effectiveness of the Eighth Amendment. The Credit Facility allows for an increase in total commitments of up to an additional $100.0 million if certain conditions are met. The swing line facility is $35.0 million . The Credit Facility matures in July 2021. Both the revolving loan facility and term loan bear interest based on a variable Eurodollar rate option (LIBOR plus 3.50% margin at September 30, 2019 ) and has commitment fees on unused borrowing capacity ( 0.55% at September 30, 2019 ). The Credit Facility limits our ability to pay cash dividends. The Company’s obligations under the Credit Facility are guaranteed by its material direct and indirect domestic subsidiaries and are secured by a lien on substantially all of the Company’s and the guarantors’ tangible and intangible property (subject to certain specified exclusions) and by a pledge of all of the equity interests in the Company’s material direct and indirect domestic subsidiaries and 65% of the equity interests in the Company’s material first-tier foreign subsidiaries. The Eighth Amendment amended the financial covenants in the Credit Facility by eliminating the ratio of consolidated EBITDA to consolidated interest charges (the “Interest Coverage Ratio,” as defined in the Credit Facility agreement), adding the ratio of consolidated funded indebtedness to consolidated EBITDA (the "Net Leverage Ratio," as defined in the Credit Facility agreement), adding the ratio of the sum of consolidated EBITDA less taxes and capital expenditures paid in cash to consolidated debt service (the "Debt Service Coverage Ratio," as defined in the Credit Facility agreement) and modifying the ratio of senior secured debt to consolidated EBITDA (the “Senior Secured Leverage Ratio,” as defined in the Credit Facility agreement). The financial covenant requirements under the Eighth Amendment are summarized in the table below. Fiscal Quarter Ending Maximum Senior Secured Leverage Ratio September 30, 2019, December 31, 2019, March 31, 2020, June 30, 2020 and September 30, 2020 2.75 to 1.00 December 31, 2020 and each Fiscal Quarter thereafter 2.50 to 1.00 Fiscal Quarter Ending Maximum Net Leverage Ratio March 31, 2020 5.50 to 1.00 June 30, 2020 5.25 to 1.00 September 30, 2020 5.00 to 1.00 December 31, 2020 and each Fiscal Quarter thereafter 4.50 to 1.00 Fiscal Quarter Ending Minimum Debt Service Coverage Ratio September 30, 2019 1.10 to 1.00 December 31, 2019, March 31, 2020, June 30, 2020 and September 30, 2020 1.25 to 1.00 December 31, 2020 and each Fiscal Quarter thereafter 1.50 to 1.00 As of September 30, 2019 , we are in compliance with the covenants in effect as of such date. The Senior Secured Leverage Ratio and Debt Service Coverage Ratio stood at 2.00 to 1.00 and 1.97 to 1.00, respectively, as of September 30, 2019 . We are not bound by a covenant with respect to the Net Leverage Ratio until March 31, 2020, however, as of September 30, 2019 this ratio stood at 5.00 to 1.00. At September 30, 2019 , we had $10.3 million of cash on hand and had approximately $59 million of available borrowing capacity through our Credit Facility. As of September 30, 2019 , we had $2.4 million of unamortized debt issuance costs and debt discount that are being amortized over the life of the Credit Facility. Our ability to maintain compliance with the financial covenants is dependent upon our future operating performance and future financial condition, both of which are subject to various risks and uncertainties. Accordingly, there can be no assurance that we will be able to maintain compliance with the Credit Facility covenants as of any future date. In the event we are unable to maintain compliance with our financial covenants, we would seek to enter into an amendment to the Credit Facility with our bank group in order to modify and/or to provide relief from the financial covenants for an additional period of time. Although we have entered into amendments in the past, there can be no assurance that any future amendments would be available on terms acceptable to us, if at all. In order to secure our casualty insurance programs we are required to post letters of credit generally issued by a bank as collateral. A letter of credit commits the issuer to remit specified amounts to the holder, if the holder demonstrates that we failed to meet our obligations under the letter of credit. If this were to occur, we would be obligated to reimburse the issuer for any payments the issuer was required to remit to the holder of the letter of credit. We were contingently liable for outstanding stand-by letters of credit totaling $18.5 million at September 30, 2019 and $22.8 million at December 31, 2018 . Outstanding letters of credit reduce amounts available under our Credit Facility and are considered as having been funded for purposes of calculating our financial covenants under the Credit Facility. Convertible Debt Description of the Notes On July 31, 2017, we issued $230.0 million principal amount of 5.00% Convertible Senior Notes due 2023 (the “Notes”). The Notes, which are senior unsecured obligations of the Company, bear interest at a rate of 5.0% per year, payable semiannually in arrears on February 1 and August 1 of each year, beginning on February 1, 2018. The Notes will mature on August 1, 2023 unless repurchased, redeemed or converted in accordance with their terms prior to such date. The Notes will be convertible at an initial conversion rate of 46.0829 shares of our common stock per $1,000 principal amount of the Notes, which is equivalent to an initial conversion price of approximately $21.70 per share. The conversion rate, and thus the conversion price, may be adjusted under certain circumstances as described in the indenture governing the Notes. Holders may convert their Notes at their option prior to the close of business on the business day immediately preceding May 1, 2023, but only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on December 31, 2017 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of Notes for each trading day of such measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on such trading day; • if we call any or all of the Notes for redemption, at any time prior to the close of business on the business day immediately preceding the redemption date; or • upon the occurrence of specified corporate events described in the indenture governing the Notes. On or after May 1, 2023 until the close of business on the business day immediately preceding the maturity date, holders may, at their option, convert their Notes at any time, regardless of the foregoing circumstances. The Notes are initially convertible into 10,599,067 shares of common stock. Because the Notes could be convertible in full into more than 19.99% of our outstanding common stock, we were required by the listing rules of the New York Stock Exchange to obtain the approval of the holders of our outstanding shares of common stock before the Notes could be converted into more than 5,964,858 shares of common stock. The Notes will be convertible into, subject to various conditions, cash or shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, in each case, at the Company’s election. If holders elect to convert the Notes in connection with certain fundamental change transactions described in the indenture governing the Notes, we will, under certain circumstances described in the indenture governing the Notes, increase the conversion rate for the Notes so surrendered for conversion. We may not redeem the Notes prior to August 5, 2021. We will have the option to redeem all or any portion of the Notes on or after August 5, 2021, if certain conditions (including that our common stock is trading at or above 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive)), including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. Accounting Treatment of the Notes As of September 30, 2019 and December 31, 2018 , the Notes were recorded in our condensed consolidated balance sheets as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Liability component: Principal $ 230,000 $ 230,000 Unamortized issuance costs (5,033 ) (5,834 ) Unamortized discount (25,004 ) (28,982 ) Net carrying amount of the liability component 1 $ 199,963 $ 195,184 Equity component: Carrying amount of the equity component, net of issuance costs 2 $ 13,912 $ 13,912 _________________ 1 Included in the “Long-term debt” line of the condensed consolidated balance sheets. 2 Relates to the portion of the Notes accounted for under ASC 470-20 (defined below) and is included in the “Additional paid-in capital” line of the condensed consolidated balance sheets. Under ASC 470-20, Debt with Conversion and Other Options , (“ASC 470-20”), an entity must separately account for the liability and equity components of convertible debt instruments that may be settled entirely or partially in cash upon conversion (such as the Notes) in a manner that reflects the issuer’s economic interest cost. However, entities must first consider the guidance in ASC 815-15, Embedded Derivatives (“ASC 815-15”), to determine if an instrument contains an embedded feature that should be separately accounted for as a derivative. We applied this guidance as of the issuance date of the Notes and concluded that for the conversion feature for a portion of the Notes, we must recognize an embedded derivative under ASC 815-15, while the remainder of the Notes is subject to ASC 470-20. The Company determined the portions of the Notes subject to ASC 815-15 and ASC 470-20 as follows. While the Notes are initially convertible into 10,599,067 shares of common stock, the occurrence of certain corporate events could increase the conversion rate, which could result in the Notes becoming convertible into a maximum of 14,838,703 shares. As of the issuance date of the Notes, 5,964,858 shares, or approximately 40% of the maximum number of shares, was authorized for issuance without shareholder approval, while 8,873,845 shares, or approximately 60% , would have been required to be settled in cash. Therefore, the Company concluded that embedded derivative accounting under ASC 815-15 was applicable to approximately 60% of the Notes, while the remaining 40% of the Notes was subject to ASC 470-20. We recorded the change in fair value of the embedded derivative liability in our results of operations through the shareholder approval date of May 17, 2018 and then reclassified the embedded derivative liability to stockholders’ equity at its May 17, 2018 fair value of $45.4 million during the second quarter of 2018. The related income tax effects of the reclassification charged directly to stockholders’ equity were $7.8 million . As a result of the reclassification to stockholders’ equity, the embedded derivative will no longer be marked to fair value each period. Losses on the embedded derivative liability recognized in the condensed consolidated statements of operations were $24.8 million for the nine months ended September 30, 2018. The following table sets forth interest expense information related to the Notes (dollars in thousands): Three Months Ended Nine Months Ended (unaudited) (unaudited) (unaudited) (unaudited) 2019 2018 2019 2018 Coupon interest $ 2,875 $ 2,875 $ 8,625 $ 8,625 Amortization of debt discount and issuance costs 1,633 1,493 4,778 4,371 Total interest expense on convertible senior notes $ 4,508 $ 4,368 $ 13,403 $ 12,996 Effective interest rate 9.12 % 9.12 % 9.12 % 9.12 % As of September 30, 2019 , the remaining amortization period for the debt discount and issuance costs is 46 months. Derivatives and Hedging ASC 815, Derivatives and Hedging (“ASC 815”), requires that derivative instruments be recorded at fair value and included in the balance sheet as assets or liabilities. The accounting for changes in the fair value of a derivative instrument depends on the intended use of the derivative and the resulting designation, which is established at the inception date of a derivative. Special accounting for derivatives qualifying as fair value hedges allows derivatives’ gains and losses to offset related results on the hedged item in the statement of operations. For derivative instruments designated as cash flow hedges, changes in fair value, to the extent the hedge is effective, are recognized in other comprehensive income (loss) until the hedged item is recognized in earnings. Hedge effectiveness is measured at least quarterly based on the relative cumulative changes in fair value between the derivative contract and the hedged item over time. Credit risks related to derivatives include the possibility that the counter-party will not fulfill the terms of the contract. We consider counterparty credit risk to our derivative contracts when valuing our derivative instruments. Our borrowing of €12.3 million under the Credit Facility serves as an economic hedge of our net investment in our European operations as fluctuations in the fair value of the borrowing attributable to the U.S. Dollar/Euro spot rate will offset translation gains or losses attributable to our investment in our European operations. At September 30, 2019 , the €12.3 million borrowing had a U.S. Dollar value of $13.4 million . As discussed above, we previously recorded an embedded derivative liability for a portion of the Notes. In accordance with ASC 815-15, the embedded derivative instrument was recorded at fair value each period with changes in fair value reflected in our results of operations. No hedge accounting was applied. As a result of obtaining shareholder approval for the issuance of shares upon conversion of the Notes, we recorded the change in fair value of the embedded derivative liability in our results of operations through the shareholder approval date of May 17, 2018 and then reclassified the embedded derivative liability to stockholders’ equity at its May 17, 2018 fair value of $45.4 million during the second quarter of 2018. As a result of the reclassification to stockholders’ equity, the embedded derivative is no longer marked to fair value each period. The amounts recognized in other comprehensive income (loss), reclassified into income (loss) and the amounts recognized in income (loss) for the three and nine months ended September 30, 2019 and 2018 , are as follows (in thousands): Gain (Loss) Gain (Loss) Gain (Loss) Gain (Loss) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended (unaudited) (unaudited) (unaudited) (unaudited) 2019 2018 2019 2018 2019 2018 2019 2018 Derivatives Classified as Hedging Instruments Net investment hedge $ 556 $ 97 $ — $ — $ 651 $ 464 $ — $ — Gain (Loss) Recognized in Income (Loss) 1 Three Months Ended Nine Months Ended (unaudited) (unaudited) 2019 2018 2019 2018 Derivatives Not Classified as Hedging Instruments Embedded derivative in convertible debt $ — $ — $ — $ (24,783 ) _________________ 1 Reflected as “Loss on convertible debt embedded derivative” in the condensed consolidated statements of operations. The following table presents the fair value totals and balance sheet classification for derivatives designated as hedges and derivatives not designated as hedges under ASC 815 (in thousands): September 30, 2019 December 31, 2018 (unaudited) Classification Balance Sheet Location Fair Value Classification Balance Sheet Location Fair Derivatives Classified as Hedging Instruments Net investment hedge Liability Long-term debt $ (4,555 ) Liability Long-term debt $ (3,904 ) |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
LEASES | LEASES We determine if an arrangement is a lease at inception. Operating leases are included in “Operating lease right-of-use (‘ROU’) assets”, “operating lease liabilities” and “current portion of operating lease obligations” on our consolidated balance sheets. Finance leases are included in “property, plant and equipment, net”, “current portion of long-term debt and finance lease obligations” and “long-term debt and finance lease obligations” on our consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Operating lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Variable lease payments and short-term lease payments (leases with initial terms less than 12 months) are expensed as incurred. We have lease agreements with lease and non-lease components for certain equipment, office, and vehicle leases. We have elected the practical expedient to not separate lease and non-lease components and account for both as a single lease component. We have operating and finance leases primarily for equipment, real estate, and vehicles. Our leases have remaining lease terms of 1 year to 15 years , some of which may include options to extend the leases for up to 10 years , and some of which may include options to terminate the leases within 1 year . The components of lease expense are as follows (in thousands): Three Months Ended Nine Months Ended (unaudited) (unaudited) Operating lease costs $ 7,659 $ 23,042 Variable lease costs 1,774 4,702 Finance lease costs: Amortization of right-of-use assets 106 214 Interest on lease liabilities 78 251 Total lease cost $ 9,617 $ 28,209 Other information related to leases are as follows (in thousands): Three Months Ended Nine Months Ended (unaudited) (unaudited) Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases 6,025 18,210 Operating cash flows from finance leases 85 305 Financing cash flows from finance leases 62 201 Right-of-use assets obtained in exchange for lease obligations Operating leases 3,411 11,192 Finance leases — 290 As of September 30, 2019 , future minimum lease payments under non-cancellable leases (excluding short-term leases) are as follows (in thousands): Twelve Months Ended December 31, Operating Leases Finance Lease (unaudited) (unaudited) 2019 (excluding the nine months ended September 30, 2019) $ 5,731 $ 146 2020 20,033 584 2021 14,773 588 2022 12,004 592 2023 9,730 542 Thereafter 25,348 5,640 Total future minimum lease payments 87,619 8,092 Less: Interest (18,348 ) (2,703 ) Present value of lease liabilities $ 69,271 $ 5,389 As of December 31, 2018, we disclosed the following undiscounted future gross minimum lease payments for non-cancellable operating and finance leases (in thousands): Twelve Months Ended December 31, Operating Leases Finance Lease 2019 $ 23,315 $ 583 2020 16,858 500 2021 12,577 504 2022 9,873 524 2023 7,846 525 Thereafter 23,224 5,631 Total minimum lease payments $ 93,693 $ 8,267 Less: Interest on finance leases (2,911 ) Total principal payable on finance leases $ 5,356 Amounts recognized in the condensed consolidated balance sheet are as follows (in thousands): September 30, 2019 Operating Leases: (unaudited) Operating lease right-of-use assets $ 64,605 Current portion of operating lease obligations 17,036 Operating lease obligations (non-current) 52,235 Finance Leases: Property, plant and equipment, net $ 5,226 Current portion of long-term debt and finance lease obligations 283 Long-term debt and finance lease obligations 5,106 Weighted average remaining lease term Operating leases 6 years Finance leases 14 years Weighted average discount rate Operating leases 8.4 % Finance lease 6.3 % As of September 30, 2019 , we have no material additional operating and finance leases that have not yet commenced. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 9 Months Ended |
Sep. 30, 2019 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS We have a defined benefit pension plan covering certain United Kingdom employees (the “U.K. Plan”). In connection with the sale of the Company’s Norwegian operations in 2018, all assets and liabilities associated with the defined benefit pension plan covering certain Norwegian employees (the “Norwegian Plan”) were transferred to the buyer. The schedule of net periodic pension credit includes only the U.K. Plan in 2019 and combined amounts from the Norwegian and U.K. Plans in 2018. Net periodic pension credit includes the following components (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Service cost $ — $ 23 $ — $ 70 Interest cost 561 563 1,740 1,752 Expected return on plan assets (574 ) (909 ) (1,781 ) (2,827 ) Amortization of unrecognized prior service cost 8 — 24 — Net periodic pension credit $ (5 ) $ (323 ) $ (17 ) $ (1,005 ) The expected long-term rate of return on invested assets is determined based on the weighted average of expected returns on asset investment categories for the U.K. Plan as follows: 3.25% overall, 5.77% for equities and 2.66% for debt securities. We expect to contribute $2.3 million to the U.K. Plan for 2019 , of which $1.7 million has been contributed through September 30, 2019 . |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS We apply the provisions of ASC 820, Fair Value Measurement (“ASC 820”) which among other things, requires certain disclosures about assets and liabilities carried at fair value. As defined in ASC 820, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. We primarily apply the market approach for recurring fair value measurements and endeavor to utilize the best information available. Accordingly, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The use of unobservable inputs is intended to allow for fair value determinations in situations in which there is little, if any, market activity for the asset or liability at the measurement date. We are able to classify fair value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy such that “Level 1” measurements include unadjusted quoted market prices for identical assets or liabilities in an active market, “Level 2” measurements include quoted market prices for identical assets or liabilities in an active market which have been adjusted for items such as effects of restrictions for transferability and those that are not quoted but are observable through corroboration with observable market data, including quoted market prices for similar assets, and “Level 3” measurements include those that are unobservable and of a highly subjective measure. The following table sets forth, by level within the fair value hierarchy, our financial assets and liabilities that are accounted for at fair value on a recurring basis as of September 30, 2019 and December 31, 2018 . As required by ASC 820, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement (in thousands): September 30, 2019 (unaudited) Quoted Prices in Active Markets for Identical Items (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Liabilities: Contingent consideration $ — $ — $ — $ — Net investment hedge $ — $ (4,555 ) $ — $ (4,555 ) December 31, 2018 Quoted Prices in Active Markets for Identical Items (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Liabilities: Contingent consideration $ — $ — $ 429 $ 429 Net investment hedge $ — $ (3,904 ) $ — $ (3,904 ) There were no transfers in and out of Level 3 during the nine months ended September 30, 2019 and 2018 . The fair value of contingent consideration liabilities classified in the table above were estimated using a discounted cash flow technique with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC 820. The significant inputs in the Level 3 measurement not supported by market activity include a combination of actual cash flows and probability-weighted assessments of expected future cash flows related to the acquired businesses, appropriately discounted considering the uncertainties associated with the obligation, and as calculated in accordance with the terms of the acquisition agreements. The following table represents the changes in the fair value of Level 3 contingent consideration liabilities (in thousands): Nine Months Ended (unaudited) Balance, beginning of period $ 429 Foreign currency effects (1 ) Payment (428 ) Balance, end of period $ — |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION We have adopted stock incentive plans and other arrangements pursuant to which our Board of Directors (the “Board”) may grant stock options, restricted stock, stock units, stock appreciation rights, common stock or performance awards to officers, directors and key employees. At September 30, 2019 , there were approximately 1.5 million restricted stock units, performance awards and stock options outstanding to officers, directors and key employees. The exercise price, terms and other conditions applicable to each form of share-based compensation under our plans are generally determined by the Compensation Committee of our Board at the time of grant and may vary. Our share-based payments consist primarily of stock units, performance awards, common stock and stock options. In May 2018, our shareholders approved the 2018 Team, Inc. Equity Incentive Plan (the “2018 Plan”), which replaced the 2016 Team, Inc. Equity Incentive Plan (the “2016 Plan”). In May 2019, our shareholders approved an amendment to the 2018 Plan to increase the number of authorized shares available for issuance. The 2018 Plan authorizes the issuance of share-based awards representing up to 1.2 million shares of common stock, plus the number of shares remaining available for issuance under the 2016 Plan, plus the number of shares subject to outstanding awards under specified prior plans that may become available for reissuance in certain circumstances. Shares issued in connection with our share-based compensation are issued out of authorized but unissued common stock. Compensation expense related to share-based compensation totaled $8.7 million and $9.4 million for the nine months ended September 30, 2019 and 2018 , respectively. Share-based compensation expense reflects an estimate of expected forfeitures. At September 30, 2019 , $13.2 million of unrecognized compensation expense related to share-based compensation is expected to be recognized over a remaining weighted-average period of 2.0 years . Stock units are settled with common stock upon vesting unless it is not legally feasible to issue shares, in which case the value of the award is settled in cash. We determine the fair value of each stock unit based on the market price on the date of grant. Stock units generally vest in annual installments over four years and the expense associated with the units is recognized over the same vesting period. We also grant common stock to our directors, which typically vests immediately. Compensation expense related to stock units and director stock grants totaled $4.6 million and $6.2 million for the nine months ended September 30, 2019 and 2018 . Transactions involving our stock units and director stock grants during the nine months ended September 30, 2019 are summarized below: Nine Months Ended (unaudited) No. of Stock Units Weighted Average Fair Value (in thousands) Stock and stock units, beginning of period 856 $ 18.79 Changes during the period: Granted 45 $ 15.58 Vested and settled (133 ) $ 15.55 Cancelled (54 ) $ 18.75 Stock and stock units, end of period 714 $ 19.19 We have a performance stock unit award program whereby we grant Long-Term Performance Stock Unit (“LTPSU”) awards to our executive officers. Under this program, the Company communicates “target awards” to the executive officers at the beginning of a performance period. LTPSU awards cliff vest with the achievement of the performance goals and completion of the required service period. Settlement occurs with common stock as soon as practicable following the vesting date. LTPSU awards granted in 2018 (the “2018 Awards”) and 2019 (the “2019 Awards”) are subject to a two -year performance period and a concurrent two -year service period. For the 2018 and 2019 Awards, the performance goals are separated into two independent performance factors based on (i) relative shareholder return (“RTSR”) as measured against a designated peer group and (ii) results of operations over the two-year performance period, with possible payouts ranging from 0% to 200% of the target awards for each of the two performance factors. The RTSR and the stock price milestone factors are considered to be market conditions under GAAP. For performance units subject to market conditions, we determine the fair value of the performance units based on the results of a Monte Carlo simulation, which uses market-based inputs as of the date of grant to simulate future stock returns. Compensation expense for awards with market conditions is recognized on a straight-line basis over the longer of (i) the minimum required service period and (ii) the service period derived from the Monte Carlo simulation, separately for each vesting tranche. For performance units subject to market conditions, because the expected outcome is incorporated into the grant date fair value through the Monte Carlo simulation, compensation expense is not subsequently adjusted for changes in the expected or actual performance outcome. For performance units not subject to market conditions, we determine the fair value of each performance unit based on the market price of our common stock on the date of grant. For these awards, we recognize compensation expense over the vesting term on a straight-line basis based upon the performance target that is probable of being met, subject to adjustment for changes in the expected or actual performance outcome. Compensation expense related to performance awards totaled $4.0 million and $3.2 million for the nine months ended September 30, 2019 and 2018 , respectively. Transactions involving our performance awards during the nine months ended September 30, 2019 are summarized below: Nine Months Ended (unaudited) Performance Units Subject to Market Conditions Performance Units Not Subject to Market Conditions No. of Stock Units 1 Weighted Average Fair Value No. of Stock Units 1 Weighted Average Fair Value (in thousands) (in thousands) Performance stock units, beginning of period 495 $ 14.47 145 $ 17.88 Changes during the period: Granted 127 $ 25.24 127 $ 18.42 Vested and settled (105 ) $ 16.04 (35 ) $ 25.40 Cancelled (11 ) $ 16.78 (12 ) $ 23.66 Performance stock units, end of period 506 $ 16.63 225 $ 17.00 _________________ 1 Performance units with variable payouts are shown at target level of performance. We determine the fair value of each stock option at the grant date using a Black-Scholes model and recognize the resulting expense of our stock option awards over the period during which an employee is required to provide services in exchange for the awards, usually the vesting period. Compensation expense related to stock options for the nine months ended September 30, 2019 and 2018 was not material. Our options typically vest in equal annual installments over a four -year service period. Expense related to an option grant is recognized on a straight line basis over the specified vesting period for those options. Stock options generally have a ten -year term. At September 30, 2019 , there are approximately 53 thousand exercisable shares outstanding at a weighted average exercise price of $32.55 . Options exercisable at September 30, 2019 had a weighted-average remaining contractual life of 1.9 years and exercise prices ranged from $21.12 to $50.47 . |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS A summary of changes in accumulated other comprehensive loss included within shareholders’ equity is as follows (in thousands): Nine Months Ended Nine Months Ended (unaudited) (unaudited) Foreign Currency Translation Adjustments Foreign Currency Hedge Defined Benefit Pension Plans Tax Provision Total Foreign Currency Translation Adjustments Foreign Currency Hedge Defined Benefit Pension Plans Tax Provision Total Balance, beginning of period $ (30,607 ) $ 3,904 $ (7,859 ) $ 170 $ (34,392 ) $ (21,366 ) $ 3,246 $ (7,221 ) $ 5,545 $ (19,796 ) Other comprehensive income (loss) (473 ) 651 — 112 290 (4,419 ) 464 — 992 (2,963 ) Balance, end of period $ (31,080 ) $ 4,555 $ (7,859 ) $ 282 $ (34,102 ) $ (25,785 ) $ 3,710 $ (7,221 ) $ 6,537 $ (22,759 ) The following table represents the related tax effects allocated to each component of other comprehensive income (loss) (in thousands): Nine Months Ended Nine Months Ended (unaudited) (unaudited) Gross Amount Tax Effect Net Amount Gross Amount Tax Effect Net Amount Foreign currency translation adjustments $ (473 ) $ 273 $ (200 ) $ (4,419 ) $ 1,108 $ (3,311 ) Foreign currency hedge 651 (161 ) 490 464 (116 ) 348 Total $ 178 $ 112 $ 290 $ (3,955 ) $ 992 $ (2,963 ) |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Con Ed Matter —We have, from time to time, provided temporary leak repair services to the steam system of Consolidated Edison Company of New York (“Con Ed”) located in New York City. In July 2007, a Con Ed steam main located in midtown Manhattan ruptured resulting in one death and other injuries and property damage. Lawsuits were filed against Con Ed, the City of New York and Team in the Supreme Court of New York, alleging that our temporary leak repair services may have contributed to the cause of the rupture, allegations which we dispute. The lawsuits sought unspecified compensatory damages for personal injury, property damage and business interruption. Additionally, Con Ed alleged that our contract with Con Ed required us to fully indemnify and defend Con Ed for all claims asserted against Con Ed including those amounts that Con Ed paid to settle with certain plaintiffs for undisclosed sums as well as Con Ed’s own alleged damages to its infrastructure. Con Ed filed an action to join Team and the City of New York as defendants in all lawsuits filed against Con Ed that did not include Team and the City of New York as direct defendants. In October 2019, Con Ed and Team entered into a comprehensive settlement agreement wherein both parties agreed to settle the dispute and release all claims asserted against each other in the lawsuit. Twenty-three lawsuits, alleging property damage and non-critical injuries, are pending with Team named as a direct defendant. We expect that each of these claims will settle for nominal amounts over the next several months. We maintain insurance coverage, subject to a deductible limit of $250,000 , which we believe should cover these claims. We have not accrued any liability in excess of the deductible limit for the lawsuits. We do not believe the ultimate outcome of these matters will have a material adverse effect on our financial position, results of operations, or cash flows. Patent Infringement Matters —In December 2014, our subsidiary, Quest Integrity Group, LLC, filed three patent infringement lawsuits against three different defendants, two in the U.S. District of Delaware (the “Delaware Cases”) and one in the U.S. District of Western Washington (the “Washington Case”). Quest Integrity alleges that the three defendants infringed Quest Integrity’s patent, entitled “2D and 3D Display System and Method for Furnace Tube Inspection”. This Quest Integrity patent generally teaches a system and method for displaying inspection data collected during the inspection of furnace tubes in petroleum and petro-chemical refineries. The subject patent litigation is specific to the visual display of the collected data and does not relate to Quest Integrity’s underlying advanced inspection technology. In these lawsuits Quest Integrity is seeking temporary and permanent injunctive relief, as well as monetary damages. Defendants have denied they infringe any valid claim of Quest Integrity’s patent, and have asserted declaratory judgment counterclaims that the patent at issue is invalid and/or unenforceable, and not infringed. In June 2015, the U.S. District of Delaware denied our motions for preliminary injunctive relief in the Delaware Cases (that is, our request that the defendants stop using our patented systems and methods during the pendency of the actions). In March 2017, the judge in the Delaware Cases granted summary judgment against Quest Integrity, finding certain patent claims of the asserted patent invalid. In late 2018 and early 2019, Quest Integrity settled with two of the three defendants and has appealed the ruling in the Delaware Case with the remaining defendant. In May 2019, the Court of Appeals for the Federal Circuit issued an opinion reversing and remanding the decisions of invalidity on certain claims and reversing other material aspects of the U.S. District Court of Delaware’s findings. The U. S. District Court of Delaware has scheduled the remanded trial for the second quarter of 2020. We are involved in various other lawsuits and are subject to various claims and proceedings encountered in the normal conduct of business. In our opinion, any uninsured losses that might arise from these lawsuits and proceedings will not have a materially adverse effect on our consolidated financial statements. We establish a liability for loss contingencies, when information available to us indicates that it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. |
SEGMENT AND GEOGRAPHIC DISCLOSU
SEGMENT AND GEOGRAPHIC DISCLOSURES | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC DISCLOSURES | SEGMENT AND GEOGRAPHIC DISCLOSURES ASC 280, Segment Reporting , requires us to disclose certain information about our operating segments where operating segments are defined as “components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance.” We conduct operations in three segments: IHT, MS and Quest Integrity. Segment data for our three operating segments are as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Revenues: IHT $ 126,379 $ 147,529 $ 392,093 $ 467,621 MS 135,625 119,011 402,048 400,890 Quest Integrity 28,075 24,316 81,366 68,619 Total $ 290,079 $ 290,856 $ 875,507 $ 937,130 Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Operating income (loss): IHT $ 6,640 $ 8,754 $ 17,858 $ 28,775 MS 15,871 (9,086 ) 41,722 4,014 Quest Integrity 7,122 5,255 18,090 12,100 Corporate and shared support services (31,473 ) (24,617 ) (83,034 ) (76,909 ) Total $ (1,840 ) $ (19,694 ) $ (5,364 ) $ (32,020 ) Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Capital expenditures 1 : IHT $ 2,588 $ 1,537 $ 5,639 $ 5,935 MS 3,795 4,930 8,382 8,955 Quest Integrity 1,038 610 3,615 2,262 Corporate and shared support services 1,845 235 7,132 2,242 Total $ 9,266 $ 7,312 $ 24,768 $ 19,394 _____________ 1 Totals may vary from amounts presented in the condensed consolidated statements of cash flows due to the timing of cash payments. Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Depreciation and amortization: IHT $ 4,390 $ 4,649 $ 13,293 $ 14,179 MS 5,411 8,911 16,343 27,133 Quest Integrity 814 1,025 2,734 2,990 Corporate and shared support services 1,435 1,447 4,330 4,164 Total $ 12,050 $ 16,032 $ 36,700 $ 48,466 Separate measures of Team’s assets by operating segment are not produced or utilized by management to evaluate segment performance. A geographic breakdown of our revenues for the three and nine months ended September 30, 2019 and 2018 is as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Total Revenues: 1 United States $ 204,659 $ 207,655 $ 641,330 $ 683,804 Canada 37,412 32,525 92,063 111,057 Europe 32,180 32,746 95,558 93,442 Other foreign countries 15,828 17,930 46,556 48,827 Total $ 290,079 $ 290,856 $ 875,507 $ 937,130 ___________ 1 Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
RESTRUCTURING AND OTHER RELATED
RESTRUCTURING AND OTHER RELATED CHARGES (CREDITS) | 9 Months Ended |
Sep. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER RELATED CHARGES | RESTRUCTURING AND OTHER RELATED CHARGES Our restructuring and other related charges (credits), net for the three and nine months ended September 30, 2019 and 2018 are summarized by program and by segment as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) OneTEAM Program Severance and related costs IHT $ — $ 468 $ 128 $ 1,436 MS — 408 117 739 Quest Integrity 62 7 62 40 Corporate and shared support services 166 1,164 129 2,243 Subtotal 228 2,047 436 4,458 Grand Total $ 228 $ 2,047 $ 436 $ 4,458 OneTEAM Program In the fourth quarter of 2017, we engaged outside consultants to assess all aspects of our business for improvement and cost saving opportunities. In the first quarter of 2018, we completed the design phase of the project, known as OneTEAM, and entered in the deployment phase starting in the second quarter of 2018. As part of the OneTEAM Program, we decided to eliminate certain employee positions. During the nine months ended September 30, 2019 , we incurred severance charges of $0.4 million . We have incurred $7.2 million of OneTEAM severance charges cumulatively to date. As the OneTEAM Program continues, we expect some additional employee positions may be identified and impacted, resulting in additional severance costs. In addition to the impacted employee positions, certain locations may be shut down or consolidated during this process. We are currently in the second year of this three -year program and expect the program-related expenses to continue through the end of 2020. A rollforward of our accrued severance liability associated with this program is presented below (in thousands): Nine Months Ended (unaudited) Balance, beginning of period $ 2,283 Charges 436 Payments (2,205 ) Balance, end of period $ 514 For the three and nine months ended September 30, 2019, we also incurred professional fees of $3.8 million and $9.8 million , respectively, associated with OneTEAM while during the three and nine months ended September 30, 2018, we incurred $4.3 million and $11.8 million , respectively. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis for presentation | Basis for presentation. These interim financial statements are unaudited, but in the opinion of our management, reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of results for such periods. The condensed consolidated balance sheet at December 31, 2018 is derived from the December 31, 2018 audited consolidated financial statements. The results of operations for any interim period are not necessarily indicative of results for the full year. Certain disclosures have been condensed or omitted from the interim financial statements included in this report. Therefore, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on March 19, 2019 (“the 2018 Form 10K”). |
Use of estimates | Use of estimates. Our accounting policies conform to Generally Accepted Accounting Principles in the United States (“GAAP”). The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect our reported financial position and results of operations. We review significant estimates and judgments affecting our consolidated financial statements on a recurring basis and record the effect of any necessary adjustments prior to their publication. Estimates and judgments are based on information available at the time such estimates and judgments are made. Adjustments made with respect to the use of these estimates and judgments often relate to information not previously available. Uncertainties with respect to such estimates and judgments are inherent in the preparation of financial statements. Estimates and judgments are used in, among other things, (1) aspects of revenue recognition, (2) valuation of acquisition related tangible and intangible assets and assessments of all long-lived assets for possible impairment, (3) estimating various factors used to accrue liabilities for workers’ compensation, auto, medical and general liability, (4) establishing an allowance for uncollectible accounts receivable, (5) estimating the useful lives of our assets, (6) assessing future tax exposure and the realization of tax assets, (7) the valuation of the embedded derivative liability in our convertible debt, (8) selecting assumptions used in the measurement of costs and liabilities associated with defined benefit pension plans and (9) managing our foreign currency risk with certain debt obligations associated with net investments in foreign operations. |
Fair value of financial instruments | Fair value of financial instruments . Our financial instruments consist primarily of cash, cash equivalents, accounts receivable, accounts payable and debt obligations. The carrying amount of cash, cash equivalents, trade accounts receivable and trade accounts payable are representative of their respective fair values due to the short-term maturity of these instruments. The fair value of our credit facility is representative of the carrying value based upon the variable terms and management’s opinion that the current rates available to us with the same maturity and security structure are equivalent to that of the banking facility. |
Goodwill and intangible assets | Goodwill and intangible assets. Goodwill and intangible assets acquired in a business combination and determined to have an indefinite useful life are not amortized, but are instead tested for impairment at least annually in accordance with the provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350 Intangibles—Goodwill and Other (“ASC 350”). Intangible assets with estimated useful lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed for impairment in accordance with ASC 350. We assess goodwill for impairment at the reporting unit level, which we have determined to be the same as our operating segments. Each reporting unit has goodwill relating to past acquisitions. Our goodwill annual test date is December 1. We measure goodwill impairment losses as the amount by which the carrying amount of a reporting unit exceeds its fair value, not to exceed the total amount of goodwill allocated to that reporting unit. We performed our most recent annual impairment test as of December 1, 2018 and concluded that there was no impairment based upon a qualitative assessment to determine if it was more likely than not (that is, a likelihood of more than 50 percent) that the fair values of the reporting units were less than their respective carrying values as of the reporting date. There have been no events that have required an interim assessment of the carrying value of goodwill during 2019. |
Allowance for doubtful accounts | Allowance for doubtful accounts. In the ordinary course of business, a portion of our accounts receivable are not collected due to billing disputes, customer bankruptcies, dissatisfaction with the services we performed and other various reasons. We establish an allowance to account for those accounts receivable that we estimate will eventually be deemed uncollectible. The allowance for doubtful accounts is based on a combination of our historical experience and management’s review of long outstanding accounts receivable. |
Concentration of credit risk | Concentration of credit risk. No single customer accounts for more than 10% of consolidated revenues. |
Earnings (loss) per share | Earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) available to Team stockholders by the weighted-average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing net income (loss) available to Team stockholders by the sum of (1) the weighted-average number of shares of common stock outstanding during the period, (2) the dilutive effect of the assumed exercise of share-based compensation using the treasury stock method and (3) the dilutive effect of the assumed conversion of our convertible senior notes under the treasury stock method. The Company’s intent is to settle the principal amount of the convertible senior notes in cash upon conversion. If the conversion value exceeds the principal amount, the Company may elect to deliver shares of its common stock with respect to the remainder of its conversion obligation in excess of the aggregate principal amount (the “conversion spread”). Accordingly, the conversion spread is included in the denominator for the computation of diluted earnings per common share using the treasury stock method. Amounts used in basic and diluted earnings (loss) per share, for the three and nine months ended September 30, 2019 and 2018 , are as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Weighted-average number of basic shares outstanding 30,300 30,021 30,267 30,000 Stock options, stock units and performance awards — — — — Convertible Senior Notes — — — — Total shares and dilutive securities 30,300 30,021 30,267 30,000 For both the three and nine months ended September 30, 2019 and 2018 , all outstanding share-based compensation awards were excluded from the calculation of diluted loss per share because their inclusion would be antidilutive due to the net loss in those periods. Also, for both the three and nine months ended September 30, 2019 and 2018 , the convertible senior notes were excluded from diluted loss per share because the conversion price exceeded the average price of our common stock during those periods. For information on our convertible senior notes and our share-based compensation awards, refer to Note 8 and Note 12, respectively. |
Revisions to prior period consolidated financial statements | The table below provides a summary of the financial statement line items which were impacted by these error corrections (in thousands, except per share data): Three Months Ended September 30, 2018 As Previously Reported Adjustments As Revised (unaudited) (unaudited) (unaudited) Effect on condensed consolidated statement of operations Provision (benefit) for income taxes $ (4,977 ) $ 664 $ (4,313 ) Net loss $ (22,862 ) $ (664 ) $ (23,526 ) Loss per common share: Basic $ (0.76 ) (0.02 ) $ (0.78 ) Diluted $ (0.76 ) (0.02 ) $ (0.78 ) Nine Months Ended September 30, 2018 As Previously Reported Adjustments As Revised (unaudited) (unaudited) (unaudited) Effect on condensed consolidated statement of operations Provision (benefit) for income taxes $ (7,331 ) $ (6,046 ) $ (13,377 ) Net loss $ (73,177 ) $ 6,046 $ (67,131 ) Loss per common share: Basic $ (2.44 ) 0.20 $ (2.24 ) Diluted $ (2.44 ) 0.20 $ (2.24 ) |
Newly Adopted Accounting Principles and Accounting Principles Not Yet Adopted | Newly Adopted Accounting Principles Topic 842 - Leases. In February 2016, the FASB issued Accounting Standard Update No. 2016-02, Leases (“ASU 2016-02”), which establishes Accounting Standards Codification (“ASC”) Topic 842, Leases (“ASC 842”), replaced previous lease accounting guidance along with subsequent ASUs issued in 2018 to clarify certain provisions of ASU 2016-02. ASC 842 changes the accounting for leases, including a requirement to record leases with terms of greater than twelve months on the balance sheet as assets and liabilities. ASC 842 also requires us to expand our financial statement disclosures on leasing activities. We adopted ASC 842 effective January 1, 2019 and elected the modified retrospective transition method, which specified the comparative financial information will not be restated and will continue to be reported under the lease standard in effect during those periods. We elected the “package of practical expedients,” which permits us not to reassess under the new standard our prior conclusions on lease identification, lease classification and initial direct costs. We also elected the short-term lease recognition practical expedient in which leases with a term of 12 months or less will not be recognized on the balance sheet and the practical expedient to not separate lease and non-lease components for the majority of our leases. We did not elect the hindsight practical expedient. The impact of ASC 842 on our consolidated balance sheet beginning January 1, 2019 was the recognition of right-of-use assets and lease liabilities for operating leases, while our accounting for finance leases remained substantially unchanged. The cumulative effect of adoption on January 1, 2019 resulted in a $0.4 million decrease, net of tax, to beginning retained earnings. The adoption of ASC 842 did not result in any material impacts to our statements of operations or statements of cash flows. Amounts recognized at January 1, 2019 for operating leases were as follows (in thousands): January 1, 2019 (unaudited) Operating lease right-of-use assets $ 66,555 Current portion of operating lease obligations 17,770 Operating lease obligations (non-current) 54,477 Accounting Principles Not Yet Adopted ASU No. 2016-13. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), along with subsequent ASUs issued in 2019 to clarify certain provisions of ASU 2016-13, which amends GAAP by introducing a new impairment model for financial instruments that is based on expected credit losses rather than incurred credit losses. The new impairment model applies to most financial assets that are not measured at fair value, including trade accounts receivable. ASU No. 2016-13 is effective for interim and annual periods in fiscal years beginning after December 15, 2019. We plan to adopt this pronouncement for our fiscal year beginning January 1, 2020. We are currently evaluating the impact this ASU will have on our financial statements, but we do not expect such adoption to have a material impact on our results of operations or financial position. ASU No. 2018-15. In August 2018, the FASB issued ASU No. 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Topic 350): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), that requires implementation costs incurred by customers in cloud computing arrangements to be deferred and recognized over the term of the arrangement, if those costs would be capitalized by the customer in a software licensing arrangement under the internal-use software guidance in Topic 350. ASU 2018-15 requires a customer to disclose the nature of its hosting arrangements that are service contracts and provide disclosures as if the deferred implementation costs were a separate, major depreciable asset class. ASU No. 2018-15 will be effective for us as of January 1, 2020. Early adoption is permitted. We are currently evaluating the impact this ASU will have on our financial statements, but we do not expect such adoption to have a material impact on our results of operations, financial position or cash flows. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of rollforward goodwill | A rollforward of goodwill for the nine months ended September 30, 2019 is as follows (in thousands): Nine Months Ended (unaudited) IHT MS Quest Integrity Total Balance at beginning of period $ 192,608 $ 55,627 $ 33,415 $ 281,650 Foreign currency adjustments 178 (613 ) (545 ) (980 ) Balance at end of period $ 192,786 $ 55,014 $ 32,870 $ 280,670 |
Amounts used in basic and diluted earnings (loss) per share | Amounts used in basic and diluted earnings (loss) per share, for the three and nine months ended September 30, 2019 and 2018 , are as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Weighted-average number of basic shares outstanding 30,300 30,021 30,267 30,000 Stock options, stock units and performance awards — — — — Convertible Senior Notes — — — — Total shares and dilutive securities 30,300 30,021 30,267 30,000 |
Revision to prior period consolidated financial statements | The table below provides a summary of the financial statement line items which were impacted by these error corrections (in thousands, except per share data): Three Months Ended September 30, 2018 As Previously Reported Adjustments As Revised (unaudited) (unaudited) (unaudited) Effect on condensed consolidated statement of operations Provision (benefit) for income taxes $ (4,977 ) $ 664 $ (4,313 ) Net loss $ (22,862 ) $ (664 ) $ (23,526 ) Loss per common share: Basic $ (0.76 ) (0.02 ) $ (0.78 ) Diluted $ (0.76 ) (0.02 ) $ (0.78 ) Nine Months Ended September 30, 2018 As Previously Reported Adjustments As Revised (unaudited) (unaudited) (unaudited) Effect on condensed consolidated statement of operations Provision (benefit) for income taxes $ (7,331 ) $ (6,046 ) $ (13,377 ) Net loss $ (73,177 ) $ 6,046 $ (67,131 ) Loss per common share: Basic $ (2.44 ) 0.20 $ (2.24 ) Diluted $ (2.44 ) 0.20 $ (2.24 ) |
Effect of ASC 842 on our condensed consolidated balance sheet | Amounts recognized at January 1, 2019 for operating leases were as follows (in thousands): January 1, 2019 (unaudited) Operating lease right-of-use assets $ 66,555 Current portion of operating lease obligations 17,770 Operating lease obligations (non-current) 54,477 |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | A disaggregation of our revenue from contracts with customers by geographic region, by reportable operating segment and by service type is presented below (in thousands): Three Months Ended September 30, 2019 Three Months Ended September 30, 2018 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 121,772 $ 4,607 $ 126,379 $ 143,508 $ 4,021 $ 147,529 MS 101,929 33,696 135,625 80,714 38,297 119,011 Quest Integrity 18,370 9,705 28,075 15,958 8,358 24,316 Total $ 242,071 $ 48,008 $ 290,079 $ 240,180 $ 50,676 $ 290,856 Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 379,460 $ 12,633 $ 392,093 $ 456,701 $ 10,920 $ 467,621 MS 296,557 105,491 402,048 292,502 108,388 400,890 Quest Integrity 57,376 23,990 81,366 45,658 22,961 68,619 Total $ 733,393 $ 142,114 $ 875,507 $ 794,861 $ 142,269 $ 937,130 Three Months Ended September 30, 2019 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 102,448 $ 100 $ 16,500 $ 7,331 $ 126,379 MS — 134,096 382 1,147 135,625 Quest Integrity 28,075 — — — 28,075 Total $ 130,523 $ 134,196 $ 16,882 $ 8,478 $ 290,079 Three Months Ended September 30, 2018 (unaudited) Non-Destructive Evaluation and Testing Services 1 Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 119,088 $ 3,194 $ 17,019 $ 8,228 $ 147,529 MS 85 117,147 818 961 119,011 Quest Integrity 24,316 — — — 24,316 Total $ 143,489 $ 120,341 $ 17,837 $ 9,189 $ 290,856 _________________ 1 This service type is inclusive of the “Asset Integrity Management” and “Non-Destructive Evaluation” service types as disclosed in the Form 10-Q for the third quarter of 2018. Nine Months Ended September 30, 2019 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 313,375 $ 598 $ 52,804 $ 25,316 $ 392,093 MS — 396,493 2,041 3,514 402,048 Quest Integrity 81,366 — — — 81,366 Total $ 394,741 $ 397,091 $ 54,845 $ 28,830 $ 875,507 Nine Months Ended September 30, 2018 (unaudited) Non-Destructive Evaluation and Testing Services 1 Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 376,244 $ 9,077 $ 58,774 $ 23,526 $ 467,621 MS 240 394,521 1,761 4,368 400,890 Quest Integrity 68,619 — — — 68,619 Total $ 445,103 $ 403,598 $ 60,535 $ 27,894 $ 937,130 _________________ 1 This service type is inclusive of the “Asset Integrity Management” and “Non-Destructive Evaluation” service types as disclosed in the Form 10-Q for the third quarter of 2018. |
Contract with Customer, Asset and Liability | The following table provides information about trade accounts receivable, contract assets and contract liabilities as of September 30, 2019 and December 31, 2018 (in thousands): September 30, 2019 December 31, 2018 (unaudited) Trade accounts receivable, net 1 $ 263,505 $ 268,352 Contract assets 2 $ 6,224 $ 5,745 Contract liabilities 3 $ 1,181 $ 1,784 _________________ 1 Includes billed and unbilled amounts, net of allowance for doubtful accounts. See Note 3 for details. 2 Included in the “Prepaid expenses and other current assets” line on the condensed consolidated balance sheets. 3 Included in the “Other accrued liabilities” line of the condensed consolidated balance sheets. |
RECEIVABLES (Tables)
RECEIVABLES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Summary of Accounts Receivable | A summary of accounts receivable as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Trade accounts receivable $ 178,745 $ 207,266 Unbilled receivables 97,342 76,268 Allowance for doubtful accounts (12,582 ) (15,182 ) Total $ 263,505 $ 268,352 |
INVENTORY (Tables)
INVENTORY (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Summary of Inventory | A summary of inventory as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Raw materials $ 8,031 $ 8,448 Work in progress 3,862 3,900 Finished goods 31,330 36,192 Total $ 43,223 $ 48,540 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | A summary of property, plant and equipment as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Land $ 6,360 $ 6,376 Buildings and leasehold improvements 58,375 57,006 Machinery and equipment 277,692 269,084 Furniture and fixtures 10,703 10,253 Capitalized Enterprise Resource Planning system development costs 46,637 46,637 Computers and computer software 22,008 15,826 Automobiles 4,638 4,879 Construction in progress 11,777 6,550 Total 438,190 416,611 Accumulated depreciation and amortization (245,426 ) (221,817 ) Property, plant and equipment, net $ 192,764 $ 194,794 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | A summary of intangible assets as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 174,727 $ (60,440 ) $ 114,287 $ 174,894 $ (51,160 ) $ 123,734 Non-compete agreements 5,414 (5,174 ) 240 5,433 (4,882 ) 551 Trade names 24,679 (20,983 ) 3,696 24,753 (20,594 ) 4,159 Technology 7,827 (5,775 ) 2,052 7,847 (5,187 ) 2,660 Licenses 844 (621 ) 223 851 (583 ) 268 Total $ 213,491 $ (92,993 ) $ 120,498 $ 213,778 $ (82,406 ) $ 131,372 |
OTHER ACCRUED LIABILITIES (Tabl
OTHER ACCRUED LIABILITIES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Summary of Other Accrued Liabilities | A summary of other accrued liabilities as of September 30, 2019 and December 31, 2018 is as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Payroll and other compensation expenses $ 59,040 $ 47,988 Insurance accruals 13,400 16,001 Property, sales and other non-income related taxes 5,688 7,271 Lease commitments 35 1,145 Contract liabilities 1,181 1,784 Accrued commission 3,341 2,290 Accrued interest 2,138 5,261 Volume discount 3,811 4,322 Contingent consideration — 429 Professional fees 1,350 1,219 Other 4,705 7,598 Total $ 94,689 $ 95,308 |
LONG-TERM DEBT, LETTERS OF CR_2
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | As of September 30, 2019 and December 31, 2018 , our long-term debt is summarized as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Credit Facility revolver $ 90,674 $ 156,843 Credit Facility term loan 1 49,691 — Total Credit Facility 140,365 156,843 Convertible debt 2 199,963 195,184 Finance lease obligations 5,389 5,356 Total long-term debt and finance lease obligations 345,717 357,383 Less: current portion of long-term debt and finance lease obligations 4,033 569 Total long-term debt and finance lease obligations, less current portion $ 341,684 $ 356,814 _________________ 1 Comprised of principal amount outstanding, less unamortized discount and issuance costs. 2 Comprised of principal amount outstanding, less unamortized discount and issuance costs. See Convertible Debt section below for additional information. |
Credit Facility Financial Covenant Requirements | Fiscal Quarter Ending Maximum Senior Secured Leverage Ratio September 30, 2019, December 31, 2019, March 31, 2020, June 30, 2020 and September 30, 2020 2.75 to 1.00 December 31, 2020 and each Fiscal Quarter thereafter 2.50 to 1.00 Fiscal Quarter Ending Maximum Net Leverage Ratio March 31, 2020 5.50 to 1.00 June 30, 2020 5.25 to 1.00 September 30, 2020 5.00 to 1.00 December 31, 2020 and each Fiscal Quarter thereafter 4.50 to 1.00 Fiscal Quarter Ending Minimum Debt Service Coverage Ratio September 30, 2019 1.10 to 1.00 December 31, 2019, March 31, 2020, June 30, 2020 and September 30, 2020 1.25 to 1.00 December 31, 2020 and each Fiscal Quarter thereafter 1.50 to 1.00 |
Convertible Debt | The following table sets forth interest expense information related to the Notes (dollars in thousands): Three Months Ended Nine Months Ended (unaudited) (unaudited) (unaudited) (unaudited) 2019 2018 2019 2018 Coupon interest $ 2,875 $ 2,875 $ 8,625 $ 8,625 Amortization of debt discount and issuance costs 1,633 1,493 4,778 4,371 Total interest expense on convertible senior notes $ 4,508 $ 4,368 $ 13,403 $ 12,996 Effective interest rate 9.12 % 9.12 % 9.12 % 9.12 % As of September 30, 2019 and December 31, 2018 , the Notes were recorded in our condensed consolidated balance sheets as follows (in thousands): September 30, 2019 December 31, 2018 (unaudited) Liability component: Principal $ 230,000 $ 230,000 Unamortized issuance costs (5,033 ) (5,834 ) Unamortized discount (25,004 ) (28,982 ) Net carrying amount of the liability component 1 $ 199,963 $ 195,184 Equity component: Carrying amount of the equity component, net of issuance costs 2 $ 13,912 $ 13,912 _________________ 1 Included in the “Long-term debt” line of the condensed consolidated balance sheets. 2 Relates to the portion of the Notes accounted for under ASC 470-20 (defined below) and is included in the “Additional paid-in capital” line of the condensed consolidated balance sheets. |
Amounts Recognized In Other Comprehensive Income, Reclassified Into Income (Loss) and Amounts Recognized in Income (Loss) | The amounts recognized in other comprehensive income (loss), reclassified into income (loss) and the amounts recognized in income (loss) for the three and nine months ended September 30, 2019 and 2018 , are as follows (in thousands): Gain (Loss) Gain (Loss) Gain (Loss) Gain (Loss) Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended (unaudited) (unaudited) (unaudited) (unaudited) 2019 2018 2019 2018 2019 2018 2019 2018 Derivatives Classified as Hedging Instruments Net investment hedge $ 556 $ 97 $ — $ — $ 651 $ 464 $ — $ — Gain (Loss) Recognized in Income (Loss) 1 Three Months Ended Nine Months Ended (unaudited) (unaudited) 2019 2018 2019 2018 Derivatives Not Classified as Hedging Instruments Embedded derivative in convertible debt $ — $ — $ — $ (24,783 ) _________________ 1 Reflected as “Loss on convertible debt embedded derivative” in the condensed consolidated statements of operations. |
Fair Value Totals and Balance Sheet Classification for Derivatives Designated As Hedges and Derivatives Not Designated as Hedges | The following table presents the fair value totals and balance sheet classification for derivatives designated as hedges and derivatives not designated as hedges under ASC 815 (in thousands): September 30, 2019 December 31, 2018 (unaudited) Classification Balance Sheet Location Fair Value Classification Balance Sheet Location Fair Derivatives Classified as Hedging Instruments Net investment hedge Liability Long-term debt $ (4,555 ) Liability Long-term debt $ (3,904 ) |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Lease, Cost | The components of lease expense are as follows (in thousands): Three Months Ended Nine Months Ended (unaudited) (unaudited) Operating lease costs $ 7,659 $ 23,042 Variable lease costs 1,774 4,702 Finance lease costs: Amortization of right-of-use assets 106 214 Interest on lease liabilities 78 251 Total lease cost $ 9,617 $ 28,209 |
Schedule of Other Information Related to Leases | Other information related to leases are as follows (in thousands): Three Months Ended Nine Months Ended (unaudited) (unaudited) Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases 6,025 18,210 Operating cash flows from finance leases 85 305 Financing cash flows from finance leases 62 201 Right-of-use assets obtained in exchange for lease obligations Operating leases 3,411 11,192 Finance leases — 290 |
Schedule of Operating Lease Liability | As of September 30, 2019 , future minimum lease payments under non-cancellable leases (excluding short-term leases) are as follows (in thousands): Twelve Months Ended December 31, Operating Leases Finance Lease (unaudited) (unaudited) 2019 (excluding the nine months ended September 30, 2019) $ 5,731 $ 146 2020 20,033 584 2021 14,773 588 2022 12,004 592 2023 9,730 542 Thereafter 25,348 5,640 Total future minimum lease payments 87,619 8,092 Less: Interest (18,348 ) (2,703 ) Present value of lease liabilities $ 69,271 $ 5,389 |
Finance Lease, Liability, Maturity | As of September 30, 2019 , future minimum lease payments under non-cancellable leases (excluding short-term leases) are as follows (in thousands): Twelve Months Ended December 31, Operating Leases Finance Lease (unaudited) (unaudited) 2019 (excluding the nine months ended September 30, 2019) $ 5,731 $ 146 2020 20,033 584 2021 14,773 588 2022 12,004 592 2023 9,730 542 Thereafter 25,348 5,640 Total future minimum lease payments 87,619 8,092 Less: Interest (18,348 ) (2,703 ) Present value of lease liabilities $ 69,271 $ 5,389 |
Schedule of Future Minimum Rental Payments for Operating Leases | As of December 31, 2018, we disclosed the following undiscounted future gross minimum lease payments for non-cancellable operating and finance leases (in thousands): Twelve Months Ended December 31, Operating Leases Finance Lease 2019 $ 23,315 $ 583 2020 16,858 500 2021 12,577 504 2022 9,873 524 2023 7,846 525 Thereafter 23,224 5,631 Total minimum lease payments $ 93,693 $ 8,267 Less: Interest on finance leases (2,911 ) Total principal payable on finance leases $ 5,356 |
Amounts Recognized in Balance Sheet for Leases | Amounts recognized in the condensed consolidated balance sheet are as follows (in thousands): September 30, 2019 Operating Leases: (unaudited) Operating lease right-of-use assets $ 64,605 Current portion of operating lease obligations 17,036 Operating lease obligations (non-current) 52,235 Finance Leases: Property, plant and equipment, net $ 5,226 Current portion of long-term debt and finance lease obligations 283 Long-term debt and finance lease obligations 5,106 Weighted average remaining lease term Operating leases 6 years Finance leases 14 years Weighted average discount rate Operating leases 8.4 % Finance lease 6.3 % |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Net Periodic Pension Cost (Credit) | Net periodic pension credit includes the following components (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Service cost $ — $ 23 $ — $ 70 Interest cost 561 563 1,740 1,752 Expected return on plan assets (574 ) (909 ) (1,781 ) (2,827 ) Amortization of unrecognized prior service cost 8 — 24 — Net periodic pension credit $ (5 ) $ (323 ) $ (17 ) $ (1,005 ) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Assets and Liabilities Measured on Recurring Basis | The following table sets forth, by level within the fair value hierarchy, our financial assets and liabilities that are accounted for at fair value on a recurring basis as of September 30, 2019 and December 31, 2018 . As required by ASC 820, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement (in thousands): September 30, 2019 (unaudited) Quoted Prices in Active Markets for Identical Items (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Liabilities: Contingent consideration $ — $ — $ — $ — Net investment hedge $ — $ (4,555 ) $ — $ (4,555 ) December 31, 2018 Quoted Prices in Active Markets for Identical Items (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Liabilities: Contingent consideration $ — $ — $ 429 $ 429 Net investment hedge $ — $ (3,904 ) $ — $ (3,904 ) |
Summary of Changes in Fair Value of Level 3 Contingent Consideration | The following table represents the changes in the fair value of Level 3 contingent consideration liabilities (in thousands): Nine Months Ended (unaudited) Balance, beginning of period $ 429 Foreign currency effects (1 ) Payment (428 ) Balance, end of period $ — |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Transactions Involving Stock Units and Director Stock Grants | Transactions involving our stock units and director stock grants during the nine months ended September 30, 2019 are summarized below: Nine Months Ended (unaudited) No. of Stock Units Weighted Average Fair Value (in thousands) Stock and stock units, beginning of period 856 $ 18.79 Changes during the period: Granted 45 $ 15.58 Vested and settled (133 ) $ 15.55 Cancelled (54 ) $ 18.75 Stock and stock units, end of period 714 $ 19.19 |
Summary of Transactions Involving Performance Awards | Transactions involving our performance awards during the nine months ended September 30, 2019 are summarized below: Nine Months Ended (unaudited) Performance Units Subject to Market Conditions Performance Units Not Subject to Market Conditions No. of Stock Units 1 Weighted Average Fair Value No. of Stock Units 1 Weighted Average Fair Value (in thousands) (in thousands) Performance stock units, beginning of period 495 $ 14.47 145 $ 17.88 Changes during the period: Granted 127 $ 25.24 127 $ 18.42 Vested and settled (105 ) $ 16.04 (35 ) $ 25.40 Cancelled (11 ) $ 16.78 (12 ) $ 23.66 Performance stock units, end of period 506 $ 16.63 225 $ 17.00 _________________ 1 Performance units with variable payouts are shown at target level of performance. |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Summary of Changes in Accumulated Other Comprehensive Loss Included Within Shareholders' Equity | A summary of changes in accumulated other comprehensive loss included within shareholders’ equity is as follows (in thousands): Nine Months Ended Nine Months Ended (unaudited) (unaudited) Foreign Currency Translation Adjustments Foreign Currency Hedge Defined Benefit Pension Plans Tax Provision Total Foreign Currency Translation Adjustments Foreign Currency Hedge Defined Benefit Pension Plans Tax Provision Total Balance, beginning of period $ (30,607 ) $ 3,904 $ (7,859 ) $ 170 $ (34,392 ) $ (21,366 ) $ 3,246 $ (7,221 ) $ 5,545 $ (19,796 ) Other comprehensive income (loss) (473 ) 651 — 112 290 (4,419 ) 464 — 992 (2,963 ) Balance, end of period $ (31,080 ) $ 4,555 $ (7,859 ) $ 282 $ (34,102 ) $ (25,785 ) $ 3,710 $ (7,221 ) $ 6,537 $ (22,759 ) |
Related Tax Effects Allocated to Each Component of Other Comprehensive Income (Loss) | The following table represents the related tax effects allocated to each component of other comprehensive income (loss) (in thousands): Nine Months Ended Nine Months Ended (unaudited) (unaudited) Gross Amount Tax Effect Net Amount Gross Amount Tax Effect Net Amount Foreign currency translation adjustments $ (473 ) $ 273 $ (200 ) $ (4,419 ) $ 1,108 $ (3,311 ) Foreign currency hedge 651 (161 ) 490 464 (116 ) 348 Total $ 178 $ 112 $ 290 $ (3,955 ) $ 992 $ (2,963 ) |
SEGMENT AND GEOGRAPHIC DISCLO_2
SEGMENT AND GEOGRAPHIC DISCLOSURES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Data for our Three Operating Segments | Segment data for our three operating segments are as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Revenues: IHT $ 126,379 $ 147,529 $ 392,093 $ 467,621 MS 135,625 119,011 402,048 400,890 Quest Integrity 28,075 24,316 81,366 68,619 Total $ 290,079 $ 290,856 $ 875,507 $ 937,130 Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Operating income (loss): IHT $ 6,640 $ 8,754 $ 17,858 $ 28,775 MS 15,871 (9,086 ) 41,722 4,014 Quest Integrity 7,122 5,255 18,090 12,100 Corporate and shared support services (31,473 ) (24,617 ) (83,034 ) (76,909 ) Total $ (1,840 ) $ (19,694 ) $ (5,364 ) $ (32,020 ) Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Capital expenditures 1 : IHT $ 2,588 $ 1,537 $ 5,639 $ 5,935 MS 3,795 4,930 8,382 8,955 Quest Integrity 1,038 610 3,615 2,262 Corporate and shared support services 1,845 235 7,132 2,242 Total $ 9,266 $ 7,312 $ 24,768 $ 19,394 _____________ 1 Totals may vary from amounts presented in the condensed consolidated statements of cash flows due to the timing of cash payments. Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Depreciation and amortization: IHT $ 4,390 $ 4,649 $ 13,293 $ 14,179 MS 5,411 8,911 16,343 27,133 Quest Integrity 814 1,025 2,734 2,990 Corporate and shared support services 1,435 1,447 4,330 4,164 Total $ 12,050 $ 16,032 $ 36,700 $ 48,466 |
Geographic Breakdown of Revenues | A geographic breakdown of our revenues for the three and nine months ended September 30, 2019 and 2018 is as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) Total Revenues: 1 United States $ 204,659 $ 207,655 $ 641,330 $ 683,804 Canada 37,412 32,525 92,063 111,057 Europe 32,180 32,746 95,558 93,442 Other foreign countries 15,828 17,930 46,556 48,827 Total $ 290,079 $ 290,856 $ 875,507 $ 937,130 ___________ 1 Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
RESTRUCTURING AND OTHER RELAT_2
RESTRUCTURING AND OTHER RELATED CHARGES (CREDITS) (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Our restructuring and other related charges (credits), net for the three and nine months ended September 30, 2019 and 2018 are summarized by program and by segment as follows (in thousands): Three Months Ended Nine Months Ended 2019 2018 2019 2018 (unaudited) (unaudited) (unaudited) (unaudited) OneTEAM Program Severance and related costs IHT $ — $ 468 $ 128 $ 1,436 MS — 408 117 739 Quest Integrity 62 7 62 40 Corporate and shared support services 166 1,164 129 2,243 Subtotal 228 2,047 436 4,458 Grand Total $ 228 $ 2,047 $ 436 $ 4,458 |
Schedule of Accrued Severance Liability | A rollforward of our accrued severance liability associated with this program is presented below (in thousands): Nine Months Ended (unaudited) Balance, beginning of period $ 2,283 Charges 436 Payments (2,205 ) Balance, end of period $ 514 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Additional Information (Details) $ in Thousands | Dec. 01, 2018USD ($) | Sep. 30, 2019USD ($)employeecountryLocation | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)employeecountrysegmentLocationcustomer | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) |
Accounting Policies [Abstract] | ||||||
Number of operating segments | segment | 3 | |||||
Number of locations in which company operates (more than) | Location | 200 | 200 | ||||
Number of countries in which the company operates | country | 20 | 20 | ||||
Number of employees | employee | 6,900 | 6,900 | ||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||
Goodwill impairment loss | $ 0 | |||||
Goodwill | $ 280,670 | $ 280,670 | $ 281,650 | |||
Accumulated impairment loss | 75,200 | 75,200 | 75,200 | |||
Income Tax Disclosure [Abstract] | ||||||
Provision (benefit) for income taxes | (2,546) | $ (4,313) | (3,210) | $ (13,377) | ||
Pre-tax loss | 9,603 | $ 27,839 | $ 28,393 | $ 80,508 | ||
Sales Revenue, Net | Customer Concentration Risk | ||||||
Significant Accounting Policies [Line Items] | ||||||
Number of customers accounted for more than specified percentage of consolidated revenues | customer | 0 | |||||
IHT | ||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||
Goodwill | 192,786 | $ 192,786 | 192,608 | |||
Accumulated impairment loss | 21,100 | 21,100 | 21,100 | |||
MS | ||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||
Goodwill | 55,014 | 55,014 | 55,627 | |||
Accumulated impairment loss | $ 54,100 | $ 54,100 | $ 54,100 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Fair Value Measurements (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Convertible debt | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of our convertible senior notes | $ 254.6 | $ 231.5 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Schedule of Rollforward Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Goodwill [Roll Forward] | |
Balance at beginning of period | $ 281,650 |
Foreign currency adjustments | (980) |
Balance at end of period | 280,670 |
IHT | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 192,608 |
Foreign currency adjustments | 178 |
Balance at end of period | 192,786 |
MS | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 55,627 |
Foreign currency adjustments | (613) |
Balance at end of period | 55,014 |
Quest Integrity | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 33,415 |
Foreign currency adjustments | (545) |
Balance at end of period | $ 32,870 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Amounts Used In Basic and Diluted Earnings Per Share (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Accounting Policies [Abstract] | ||||
Weighted-average number of basic shares outstanding (in shares) | 30,300 | 30,021 | 30,267 | 30,000 |
Stock options, stock units and performance awards (in shares) | 0 | 0 | 0 | 0 |
Convertible Senior Notes (in shares) | 0 | 0 | 0 | 0 |
Total shares and dilutive securities (in shares) | 30,300 | 30,021 | 30,267 | 30,000 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Revisions to Prior Period Financial Statements (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Prior Period Adjustments Restatement [Line Items] | ||||||||
Provision (benefit) for income taxes | $ (2,546) | $ (4,313) | $ (3,210) | $ (13,377) | ||||
Net income (loss) | $ (7,057) | $ 6,102 | $ (24,228) | $ (23,526) | $ (31,341) | $ (12,264) | $ (25,183) | $ (67,131) |
Loss per common share: | ||||||||
Basic (in dollars per share) | $ (0.23) | $ (0.78) | $ (0.83) | $ (2.24) | ||||
Diluted (in dollars per share) | $ (0.23) | $ (0.78) | $ (0.83) | $ (2.24) | ||||
As Previously Reported | ||||||||
Prior Period Adjustments Restatement [Line Items] | ||||||||
Provision (benefit) for income taxes | $ (4,977) | $ (7,331) | ||||||
Net income (loss) | $ (22,862) | $ (73,177) | ||||||
Loss per common share: | ||||||||
Basic (in dollars per share) | $ (0.76) | $ (2.44) | ||||||
Diluted (in dollars per share) | $ (0.76) | $ (2.44) | ||||||
Adjustments | ||||||||
Prior Period Adjustments Restatement [Line Items] | ||||||||
Provision (benefit) for income taxes | $ 664 | $ (6,046) | ||||||
Net income (loss) | $ (664) | $ 6,046 | ||||||
Loss per common share: | ||||||||
Basic (in dollars per share) | $ (0.02) | $ 0.20 | ||||||
Diluted (in dollars per share) | $ (0.02) | $ 0.20 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - New Accounting Standards - Effects of Adoption of Topic 842 on Condensed Consolidated Financial Statements (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jan. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease right-of-use assets | $ 64,605 | $ 66,555 |
Current portion of operating lease obligations | 17,036 | 17,770 |
Operating lease obligations (non-current) | $ 52,235 | 54,477 |
Retained Earnings | ASC 842 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Decrease, net of tax, to beginning retained earnings | $ 400 |
REVENUE - Disaggregation of Rev
REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Disaggregation of Revenue [Line Items] | |||||
Revenues | [1] | $ 290,079 | $ 290,856 | $ 875,507 | $ 937,130 |
Non-Destructive Evaluation and Testing Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 130,523 | 143,489 | 394,741 | 445,103 | |
Repair and Maintenance Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 134,196 | 120,341 | 397,091 | 403,598 | |
Heat Treating | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 16,882 | 17,837 | 54,845 | 60,535 | |
Other | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 8,478 | 9,189 | 28,830 | 27,894 | |
United States and Canada | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 242,071 | 240,180 | 733,393 | 794,861 | |
Other Countries | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 48,008 | 50,676 | 142,114 | 142,269 | |
IHT | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 126,379 | 147,529 | 392,093 | 467,621 | |
IHT | Non-Destructive Evaluation and Testing Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 102,448 | 119,088 | 313,375 | 376,244 | |
IHT | Repair and Maintenance Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 100 | 3,194 | 598 | 9,077 | |
IHT | Heat Treating | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 16,500 | 17,019 | 52,804 | 58,774 | |
IHT | Other | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 7,331 | 8,228 | 25,316 | 23,526 | |
IHT | United States and Canada | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 121,772 | 143,508 | 379,460 | 456,701 | |
IHT | Other Countries | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 4,607 | 4,021 | 12,633 | 10,920 | |
MS | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 135,625 | 119,011 | 402,048 | 400,890 | |
MS | Non-Destructive Evaluation and Testing Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 0 | 85 | 0 | 240 | |
MS | Repair and Maintenance Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 134,096 | 117,147 | 396,493 | 394,521 | |
MS | Heat Treating | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 382 | 818 | 2,041 | 1,761 | |
MS | Other | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 1,147 | 961 | 3,514 | 4,368 | |
MS | United States and Canada | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 101,929 | 80,714 | 296,557 | 292,502 | |
MS | Other Countries | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 33,696 | 38,297 | 105,491 | 108,388 | |
Quest Integrity | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 28,075 | 24,316 | 81,366 | 68,619 | |
Quest Integrity | Non-Destructive Evaluation and Testing Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 28,075 | 24,316 | 81,366 | 68,619 | |
Quest Integrity | Repair and Maintenance Services | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 0 | 0 | 0 | 0 | |
Quest Integrity | Heat Treating | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 0 | 0 | 0 | 0 | |
Quest Integrity | Other | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 0 | 0 | 0 | 0 | |
Quest Integrity | United States and Canada | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 18,370 | 15,958 | 57,376 | 45,658 | |
Quest Integrity | Other Countries | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | $ 9,705 | $ 8,358 | $ 23,990 | $ 22,961 | |
[1] | Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
REVENUE - Contract Balances (De
REVENUE - Contract Balances (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Dec. 31, 2018 | ||
Revenue from Contract with Customer [Abstract] | |||
Trade accounts receivable, net | [1] | $ 263,505 | $ 268,352 |
Contract assets | [2] | 6,224 | 5,745 |
Contract liabilities | [3] | 1,181 | $ 1,784 |
Contract asset, increase from beginning of period | $ 500 | ||
[1] | Includes billed and unbilled amounts, net of allowance for doubtful accounts. See Note 3 for details. | ||
[2] | Included in the “Prepaid expenses and other current assets” line on the condensed consolidated balance sheets. | ||
[3] | Included in the “Other accrued liabilities” line of the condensed consolidated balance sheets. |
RECEIVABLES (Details)
RECEIVABLES (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Receivables [Abstract] | |||
Trade accounts receivable | $ 178,745 | $ 207,266 | |
Unbilled receivables | 97,342 | 76,268 | |
Allowance for doubtful accounts | (12,582) | (15,182) | |
Total | [1] | $ 263,505 | $ 268,352 |
[1] | Includes billed and unbilled amounts, net of allowance for doubtful accounts. See Note 3 for details. |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 8,031 | $ 8,448 |
Work in progress | 3,862 | 3,900 |
Finished goods | 31,330 | 36,192 |
Total | $ 43,223 | $ 48,540 |
PROPERTY, PLANT AND EQUIPMENT -
PROPERTY, PLANT AND EQUIPMENT - (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||||
Total | $ 438,190 | $ 438,190 | $ 416,611 | ||
Accumulated depreciation and amortization | (245,426) | (245,426) | (221,817) | ||
Property, plant and equipment, net | 192,764 | 192,764 | 194,794 | ||
Assets under finance leases, net of accumulated amortization | 5,226 | 5,226 | 5,200 | ||
Depreciation expense | 8,400 | $ 8,900 | 25,700 | $ 27,100 | |
Land | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 6,360 | 6,360 | 6,376 | ||
Buildings and leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 58,375 | 58,375 | 57,006 | ||
Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 277,692 | 277,692 | 269,084 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 10,703 | 10,703 | 10,253 | ||
Capitalized Enterprise Resource Planning system development costs | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 46,637 | 46,637 | 46,637 | ||
Computers and computer software | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 22,008 | 22,008 | 15,826 | ||
Automobiles | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 4,638 | 4,638 | 4,879 | ||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | $ 11,777 | $ 11,777 | $ 6,550 |
INTANGIBLE ASSETS - Summary of
INTANGIBLE ASSETS - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 213,491 | $ 213,778 |
Accumulated Amortization | (92,993) | (82,406) |
Net Carrying Amount | 120,498 | 131,372 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 174,727 | 174,894 |
Accumulated Amortization | (60,440) | (51,160) |
Net Carrying Amount | 114,287 | 123,734 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 5,414 | 5,433 |
Accumulated Amortization | (5,174) | (4,882) |
Net Carrying Amount | 240 | 551 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 24,679 | 24,753 |
Accumulated Amortization | (20,983) | (20,594) |
Net Carrying Amount | 3,696 | 4,159 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 7,827 | 7,847 |
Accumulated Amortization | (5,775) | (5,187) |
Net Carrying Amount | 2,052 | 2,660 |
Licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 844 | 851 |
Accumulated Amortization | (621) | (583) |
Net Carrying Amount | $ 223 | $ 268 |
INTANGIBLE ASSETS - Additional
INTANGIBLE ASSETS - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense on intangible assets | $ 3.6 | $ 7.1 | $ 11 | $ 21.4 |
OTHER ACCRUED LIABILITIES (Deta
OTHER ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |||
Payroll and other compensation expenses | $ 59,040 | $ 47,988 | |
Insurance accruals | 13,400 | 16,001 | |
Property, sales and other non-income related taxes | 5,688 | 7,271 | |
Lease commitments | 35 | 1,145 | |
Contract liabilities | [1] | 1,181 | 1,784 |
Accrued commission | 3,341 | 2,290 | |
Accrued interest | 2,138 | 5,261 | |
Volume discount | 3,811 | 4,322 | |
Contingent consideration | 0 | 429 | |
Professional fees | 1,350 | 1,219 | |
Other | 4,705 | 7,598 | |
Total | $ 94,689 | $ 95,308 | |
[1] | Included in the “Other accrued liabilities” line of the condensed consolidated balance sheets. |
LONG-TERM DEBT, LETTERS OF CR_3
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES - Long-Term Debt Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | |||
Total long-term debt and finance lease obligations | $ 345,717 | $ 357,383 | |
Less: current portion of long-term debt and finance lease obligations | 4,033 | 569 | |
Total long-term debt and finance lease obligations, less current portion | 341,684 | 356,814 | |
Total Credit Facility | |||
Debt Instrument [Line Items] | |||
Total long-term debt and finance lease obligations | 140,365 | 156,843 | |
Convertible debt | |||
Debt Instrument [Line Items] | |||
Total long-term debt and finance lease obligations | [1] | 199,963 | 195,184 |
Finance lease obligations | |||
Debt Instrument [Line Items] | |||
Total long-term debt and finance lease obligations | 5,389 | 5,356 | |
Credit Facility revolver | Total Credit Facility | |||
Debt Instrument [Line Items] | |||
Total long-term debt and finance lease obligations | 90,674 | 156,843 | |
Credit Facility term loan | Total Credit Facility | |||
Debt Instrument [Line Items] | |||
Total long-term debt and finance lease obligations | [2] | $ 49,691 | $ 0 |
[1] | Comprised of principal amount outstanding, less unamortized discount and issuance costs. See Convertible Debt section below for additional information. | ||
[2] | Comprised of principal amount outstanding, less unamortized discount and issuance costs. |
LONG-TERM DEBT, LETTERS OF CR_4
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES - Additional Information (Details) € in Millions | 9 Months Ended | ||||
Sep. 30, 2019USD ($) | Sep. 30, 2019EUR (€) | Aug. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Jul. 31, 2017USD ($) | |
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | $ 275,000,000 | ||||
Additional borrowing capacity (up to) | 100,000,000 | ||||
Commitment fee percentage | 0.55% | ||||
Percentage of equity interests of material first-tier foreign subsidiaries guaranteed to the line of credit facility | 65.00% | 65.00% | |||
Senior Secured Leverage Ratio | 2 | 2 | |||
Debt Service Coverage Ratio | 1.97 | 1.97 | |||
Net Leverage Ratio | 5 | 5 | |||
Cash on hand | $ 10,268,000 | $ 18,288,000 | |||
Available borrowing capacity | 59,000,000 | ||||
Net Investment Hedge | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing under credit facility | $ 13,400,000 | € 12.3 | |||
LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 3.50% | ||||
Credit Facility revolver | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | 225,000,000 | ||||
Swing Line Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | 35,000,000 | ||||
Standby Letters of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Outstanding letters of credit | $ 18,500,000 | $ 22,800,000 | |||
Credit Facility term loan | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | $ 50,000,000 | ||||
Total Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Unamortized issuance costs | $ 2,400,000 | ||||
Convertible debt | |||||
Line of Credit Facility [Line Items] | |||||
Principal amount, long-term debt issued | $ 230,000,000 | ||||
September 30, 2019 | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Senior Secured Leverage Ratio | 2.75 | 2.75 | |||
Minimum Debt Service Coverage Ratio | 1.10 | 1.10 | |||
December 31, 2019 | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Senior Secured Leverage Ratio | 2.75 | 2.75 | |||
Minimum Debt Service Coverage Ratio | 1.25 | 1.25 | |||
March 31, 2020 | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Senior Secured Leverage Ratio | 2.75 | 2.75 | |||
Maximum Net Leverage Ratio | 5.50 | 5.50 | |||
Minimum Debt Service Coverage Ratio | 1.25 | 1.25 | |||
June 30, 2020 | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Senior Secured Leverage Ratio | 2.75 | 2.75 | |||
Maximum Net Leverage Ratio | 5.25 | 5.25 | |||
Minimum Debt Service Coverage Ratio | 1.25 | 1.25 | |||
September 30, 2020 | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Senior Secured Leverage Ratio | 2.75 | 2.75 | |||
Maximum Net Leverage Ratio | 5 | 5 | |||
Minimum Debt Service Coverage Ratio | 1.25 | 1.25 | |||
December 31, 2020 and thereafter | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Senior Secured Leverage Ratio | 2.50 | 2.50 | |||
Maximum Net Leverage Ratio | 4.50 | 4.50 | |||
Minimum Debt Service Coverage Ratio | 1.50 | 1.50 |
LONG-TERM DEBT, LETTERS OF CR_5
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES - Convertible Debt Details (Details) $ / shares in Units, $ in Thousands | May 17, 2018USD ($) | Sep. 30, 2019USD ($)$ / shares | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)sharesdays$ / shares | Sep. 30, 2018USD ($) | Jul. 31, 2017 |
Debt Instrument [Line Items] | ||||||
Debt instrument, convertible, threshold percentage of stock price trigger for redemption | 130.00% | |||||
Debt instrument, convertible, threshold trading days for redemption (at least) | days | 20 | |||||
Threshold consecutive trading days for redemption | 30 days | |||||
Percentage of the maximum number of shares authorized for issuance | 40.00% | 40.00% | ||||
Percentage of maximum number of shares that would require cash settlement | 60.00% | 60.00% | ||||
Tax impact of convertible debt embedded derivative liability reclassification to equity | $ | $ 7,800 | |||||
Loss on convertible debt embedded derivative (see Note 8) | $ | $ 0 | $ 0 | $ 0 | $ 24,783 | ||
Remaining amortization period of convertible debt | 46 months | |||||
Convertible debt | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate on convertible debt | 5.00% | 5.00% | 5.00% | |||
Initial conversion rate, convertible debt | 46.0829 | |||||
Initial conversion price, convertible debt (in dollars per share) | $ / shares | $ 21.70 | $ 21.70 | ||||
Threshold trading days | days | 20 | |||||
Threshold consecutive trading days | days | 30 | |||||
Threshold percentage of stock price trigger | 130.00% | |||||
Consecutive trading days, trading price criteria | 5 days | |||||
Number of business days after the specified trading price criteria met that notes may be converted | days | 5 | |||||
Convertible debt, threshold percentage, product of common stock price and conversion price | 98.00% | |||||
Number of shares into which debt is convertible (in shares) | shares | 10,599,067 | |||||
Shares outstanding, percentage threshold (more than) | 19.99% | |||||
Convertible debt, threshold shares, approval of shareholders (in shares) | shares | 5,964,858 | |||||
Redemption price, percentage (equal to) | 100.00% | |||||
Convertible debt | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Number of shares into which debt is convertible (in shares) | shares | 14,838,703 | |||||
Number of shares that would require cash settlement (in shares) | shares | 8,873,845 | |||||
Not Designated as Hedging Instrument | Long-term debt | ||||||
Debt Instrument [Line Items] | ||||||
Embedded derivative liability | $ | $ 45,400 |
LONG-TERM DEBT, LETTERS OF CR_6
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES - Detail of Convertible Debt Carrying Amount (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | |||
Carrying amount of the equity component, net of issuance costs | [1] | $ 13,912 | $ 13,912 |
Convertible debt | |||
Debt Instrument [Line Items] | |||
Principal | 230,000 | 230,000 | |
Unamortized issuance costs | (5,033) | (5,834) | |
Unamortized discount | (25,004) | (28,982) | |
Net carrying amount of the liability component1 | [2] | $ 199,963 | $ 195,184 |
[1] | Relates to the portion of the Notes accounted for under ASC 470-20 (defined below) and is included in the “Additional paid-in capital” line of the condensed consolidated balance sheets. | ||
[2] | Included in the “Long-term debt” line of the condensed consolidated balance sheets. |
LONG-TERM DEBT, LETTERS OF CR_7
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES - Components of Convertible Debt Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Debt Instrument [Line Items] | ||||
Amortization of debt discount and issuance costs | $ 5,691 | $ 5,208 | ||
Interest expense, net | $ 7,647 | $ 8,022 | 22,658 | 23,250 |
Convertible debt | ||||
Debt Instrument [Line Items] | ||||
Coupon interest | 2,875 | 2,875 | 8,625 | 8,625 |
Amortization of debt discount and issuance costs | 1,633 | 1,493 | 4,778 | 4,371 |
Interest expense, net | $ 4,508 | $ 4,368 | $ 13,403 | $ 12,996 |
Effective interest rate | 9.12% | 9.12% | 9.12% | 9.12% |
LONG-TERM DEBT, LETTERS OF CR_8
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES - Amounts Recognized in Other Comprehensive Income (Loss), and Reclassified Into Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (Loss) Recognized in Other Comprehensive Income (Loss) | $ 556 | $ 97 | $ 651 | $ 464 | |
Net Investment Hedge | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (Loss) Recognized in Other Comprehensive Income (Loss) | 556 | 97 | 651 | 464 | |
Gain (Loss) Reclassified from Other Comprehensive Income (Loss) to Earnings | 0 | 0 | 0 | 0 | |
Convertible debt embedded derivative | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | [1] | $ 0 | $ 0 | $ 0 | $ (24,783) |
[1] | Reflected as “Loss on convertible debt embedded derivative” in the condensed consolidated statements of operations. |
LONG-TERM DEBT, LETTERS OF CR_9
LONG-TERM DEBT, LETTERS OF CREDIT AND DERIVATIVES - Fair Value Totals and Balance Sheet Classification for Derivatives Designated as Hedges (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Long-term debt | Designated as Hedging Instrument | Net Investment Hedge | ||
Derivatives, Fair Value [Line Items] | ||
Fair value liability | $ (4,555) | $ (3,904) |
LEASES - Additional Information
LEASES - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2019 | |
Operating Leased Assets [Line Items] | |
Options to extend leases (up to) | 10 years |
Options to terminate leases | 1 year |
Minimum | |
Operating Leased Assets [Line Items] | |
Operating and finance leases, remaining lease term | 1 year |
Maximum | |
Operating Leased Assets [Line Items] | |
Operating and finance leases, remaining lease term | 15 years |
LEASES - Components of Lease Ex
LEASES - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Leases [Abstract] | ||
Operating lease costs | $ 7,659 | $ 23,042 |
Variable lease costs | 1,774 | 4,702 |
Finance lease costs: | ||
Amortization of right-of-use assets | 106 | 214 |
Interest on lease liabilities | 78 | 251 |
Total lease costs | $ 9,617 | $ 28,209 |
LEASES - Other Information Rela
LEASES - Other Information Related to Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities | ||
Operating cash flows from operating leases | $ 6,025 | $ 18,210 |
Operating cash flows from finance leases | 85 | 305 |
Financing cash flows from finance leases | 62 | 201 |
Right-of-use assets obtained in exchange for lease obligations | ||
Operating leases | 3,411 | 11,192 |
Finance leases | $ 0 | $ 290 |
LEASES - Operating and Finance
LEASES - Operating and Finance Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2019 (excluding the nine months ended September 30, 2019) | $ 5,731 | |
2020 | 20,033 | |
2021 | 14,773 | |
2022 | 12,004 | |
2023 | 9,730 | |
Thereafter | 25,348 | |
Total future minimum lease payments | 87,619 | |
Less: Interest | (18,348) | |
Present value of lease liabilities | 69,271 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2019 | $ 23,315 | |
2020 | 16,858 | |
2021 | 12,577 | |
2022 | 9,873 | |
2023 | 7,846 | |
Thereafter | 23,224 | |
Total minimum lease payments | 93,693 | |
Finance Lease, Liability, Payment, Due [Abstract] | ||
2019 (excluding the nine months ended September 30, 2019) | 146 | 583 |
2020 | 584 | 500 |
2021 | 588 | 504 |
2022 | 592 | 524 |
2023 | 542 | 525 |
Thereafter | 5,640 | 5,631 |
Total future minimum lease payments | 8,092 | 8,267 |
Less: Interest | (2,703) | (2,911) |
Present value of lease liabilities | $ 5,389 | $ 5,356 |
LEASES - Amounts Recognized in
LEASES - Amounts Recognized in the Balance Sheet for Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Operating Leases: | |||
Operating lease right-of-use assets | $ 64,605 | $ 66,555 | |
Current portion of operating lease obligations | 17,036 | 17,770 | |
Operating lease obligations (non-current) | 52,235 | $ 54,477 | |
Finance Leases: | |||
Property, plant and equipment, net | 5,226 | $ 5,200 | |
Current portion of long-term debt and finance lease obligations | 283 | ||
Long-term debt and finance lease obligations | $ 5,106 | ||
Weighted average remaining lease term, operating leases | 6 years | ||
Weighted average remaining lease term, finance leases | 14 years | ||
Weighted average discount rate, operating leases | 8.40% | ||
Weighted average discount rate, finance leases | 6.30% |
EMPLOYEE BENEFIT PLANS - Net Pe
EMPLOYEE BENEFIT PLANS - Net Periodic Pension Cost (Credit) (Details) - Foreign Plan - Pension Plan - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 0 | $ 23 | $ 0 | $ 70 |
Interest cost | 561 | 563 | 1,740 | 1,752 |
Expected return on plan assets | (574) | (909) | (1,781) | (2,827) |
Amortization of unrecognized prior service cost | 8 | 0 | 24 | 0 |
Net periodic pension credit | $ (5) | $ (323) | $ (17) | $ (1,005) |
EMPLOYEE BENEFIT PLANS - Additi
EMPLOYEE BENEFIT PLANS - Additional Information (Details) - Foreign Plan - Pension Plan $ in Millions | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted-average of expected returns on asset investment, percentage | 3.25% |
Expected contributions for current year | $ 2.3 |
Total contributions to date | $ 1.7 |
Equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted-average of expected returns on asset investment, percentage | 5.77% |
Debt Security | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted-average of expected returns on asset investment, percentage | 2.66% |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair Value of Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | $ 0 | $ 429 |
Net investment hedge | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | (4,555) | (3,904) |
Quoted Prices in Active Markets for Identical Items (Level 1) | Contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Items (Level 1) | Net investment hedge | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Net investment hedge | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | (4,555) | (3,904) |
Significant Unobservable Inputs (Level 3) | Contingent consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | 0 | 429 |
Significant Unobservable Inputs (Level 3) | Net investment hedge | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Net liabilities | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - Addit
FAIR VALUE MEASUREMENTS - Additional Information (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | ||
Transfer in to Level 3 measurement | $ 0 | $ 0 |
Transfer out of Level 3 measurement | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - Summa
FAIR VALUE MEASUREMENTS - Summary of Changes in Fair Value of Level 3 Contingent Consideration (Details) - Contingent consideration $ in Thousands | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance, beginning of period | $ 429 |
Foreign currency effects | (1) |
Payment | (428) |
Balance, end of period | $ 0 |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Information (Details) $ / shares in Units, $ in Millions | 9 Months Ended | |
Sep. 30, 2019USD ($)perfconditions$ / sharesshares | Sep. 30, 2018USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards outstanding to officers, directors and key employees (in shares) | shares | 1,500,000 | |
Total number of shares authorized to be issued under Equity Incentive Plan (up to) (in shares) | shares | 1,200,000 | |
Share-based compensation | $ 8.7 | $ 9.4 |
Unrecognized compensation expense related to share-based compensation | $ 13.2 | |
Remaining weighted-average period | 1 year 12 months | |
Exercisable stock option shares outstanding (in shares) | shares | 53,000 | |
Exercise price of stock options (in dollars per share) | $ / shares | $ 32.55 | |
Weighted-average remaining contractual life of options exercisable | 1 year 11 months | |
Range of prices, lower limit (in dollars per share) | $ / shares | $ 21.12 | |
Range of prices, upper limit (in dollars per share) | $ / shares | $ 50.47 | |
Stock and stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation | $ 4.6 | 6.2 |
Award vesting period | 4 years | |
Long-term performance stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation | $ 4 | $ 3.2 |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award contractual term | 10 years | |
2018 and 2019 | Long-term performance stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 2 years | |
Performance period | 2 years | |
Share-based compensation award, number of performance conditions | perfconditions | 2 | |
2018 and 2019 | Long-term performance stock units | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Possible payouts | 0.00% | |
2018 and 2019 | Long-term performance stock units | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Possible payouts | 200.00% |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summary of Transactions Involving Stock Units and Director Stock Grants (Details) - Stock and stock units shares in Thousands | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
No. of Stock Units | |
Stock and stock units, beginning of period (in shares) | shares | 856 |
Changes during the period: | |
Granted (in shares) | shares | 45 |
Vested and settled (in shares) | shares | (133) |
Cancelled (in shares) | shares | (54) |
Stock and stock units, end of period (in shares) | shares | 714 |
Weighted Average Fair Value | |
Stock and stock units, beginning of period (in dollars per share) | $ / shares | $ 18.79 |
Changes during the period: | |
Granted (in dollars per share) | $ / shares | 15.58 |
Vested and settled (in dollars per share) | $ / shares | 15.55 |
Cancelled (in dollars per share) | $ / shares | 18.75 |
Stock and stock units, end of period (in dollars per share) | $ / shares | $ 19.19 |
SHARE-BASED COMPENSATION - Su_2
SHARE-BASED COMPENSATION - Summary of Transactions Involving Performance Awards (Details) - Long-term performance stock units shares in Thousands | 9 Months Ended | |
Sep. 30, 2019$ / sharesshares | ||
Performance Units Subject to Market Conditions | ||
No. of Units/Awards | ||
Stock and stock units, beginning of period (in shares) | shares | 495 | [1] |
Changes during the period: | ||
Granted (in shares) | shares | 127 | [1] |
Vested and settled (in shares) | shares | (105) | [1] |
Cancelled (in shares) | shares | (11) | [1] |
Stock and stock units, end of period (in shares) | shares | 506 | [1] |
Weighted Average Fair Value | ||
Stock and stock units, beginning of period (in dollars per share) | $ / shares | $ 14.47 | |
Changes during the period: | ||
Granted (in dollars per share) | $ / shares | 25.24 | |
Vested and settled (in dollars per share) | $ / shares | 16.04 | |
Cancelled (in dollars per share) | $ / shares | 16.78 | |
Stock and stock units, end of period (in dollars per share) | $ / shares | $ 16.63 | |
Performance Units Not Subject to Market Conditions | ||
No. of Units/Awards | ||
Stock and stock units, beginning of period (in shares) | shares | 145 | [1] |
Changes during the period: | ||
Granted (in shares) | shares | 127 | [1] |
Vested and settled (in shares) | shares | (35) | [1] |
Cancelled (in shares) | shares | (12) | [1] |
Stock and stock units, end of period (in shares) | shares | 225 | [1] |
Weighted Average Fair Value | ||
Stock and stock units, beginning of period (in dollars per share) | $ / shares | $ 17.88 | |
Changes during the period: | ||
Granted (in dollars per share) | $ / shares | 18.42 | |
Vested and settled (in dollars per share) | $ / shares | 25.40 | |
Cancelled (in dollars per share) | $ / shares | 23.66 | |
Stock and stock units, end of period (in dollars per share) | $ / shares | $ 17 | |
[1] | Performance units with variable payouts are shown at target level of performance. |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE LOSS - Summary of Changes in Accumulated Other Comprehensive Loss Included Within Shareholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | $ 457,100 | |||
Other comprehensive income (loss) | $ (2,398) | $ 613 | 178 | $ (3,955) |
Tax Provision | (148) | 202 | 112 | 992 |
Other comprehensive income (loss), net of tax | 290 | (2,963) | ||
Balance, end of period | 439,659 | 439,659 | ||
Total | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (34,392) | (19,796) | ||
Balance, end of period | (34,102) | (22,759) | (34,102) | (22,759) |
Foreign Currency Translation Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (30,607) | (21,366) | ||
Other comprehensive income (loss) | (473) | (4,419) | ||
Tax Provision | 273 | 1,108 | ||
Balance, end of period | (31,080) | (25,785) | (31,080) | (25,785) |
Foreign Currency Hedge | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | 3,904 | 3,246 | ||
Other comprehensive income (loss) | 651 | 464 | ||
Tax Provision | (161) | (116) | ||
Balance, end of period | 4,555 | 3,710 | 4,555 | 3,710 |
Defined Benefit Pension Plans | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (7,859) | (7,221) | ||
Other comprehensive income (loss) | 0 | 0 | ||
Balance, end of period | (7,859) | (7,221) | (7,859) | (7,221) |
Tax Provision | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | 170 | 5,545 | ||
Tax Provision | 112 | 992 | ||
Balance, end of period | $ 282 | $ 6,537 | $ 282 | $ 6,537 |
ACCUMULATED OTHER COMPREHENSI_4
ACCUMULATED OTHER COMPREHENSIVE LOSS - Related Tax Effects Allocated to Each Component of Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Accumulated Other Comprehensive Loss [Line Items] | ||||
Gross Amount | $ (2,398) | $ 613 | $ 178 | $ (3,955) |
Tax (provision) benefit attributable to other comprehensive income (loss) | (148) | 202 | 112 | 992 |
Net Amount | $ (2,546) | $ 815 | 290 | (2,963) |
Foreign currency translation adjustments | ||||
Accumulated Other Comprehensive Loss [Line Items] | ||||
Gross Amount | (473) | (4,419) | ||
Tax (provision) benefit attributable to other comprehensive income (loss) | 273 | 1,108 | ||
Net Amount | (200) | (3,311) | ||
Foreign Currency Hedge | ||||
Accumulated Other Comprehensive Loss [Line Items] | ||||
Gross Amount | 651 | 464 | ||
Tax (provision) benefit attributable to other comprehensive income (loss) | (161) | (116) | ||
Net Amount | $ 490 | $ 348 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 1 Months Ended | 9 Months Ended | |
Dec. 31, 2014defendantpatent | Sep. 30, 2019USD ($)defendantlawsuit | Jul. 31, 2007death | |
Loss Contingencies [Line Items] | |||
Number of defendants with cases settled | 2 | ||
Quest Integrity | |||
Loss Contingencies [Line Items] | |||
Number of patents allegedly infringed upon | patent | 3 | ||
Number of defendants | 3 | ||
Con Ed Matter | |||
Loss Contingencies [Line Items] | |||
Number of deaths | death | 1 | ||
Number of pending lawsuits | lawsuit | 23 | ||
Insurance coverage subject to deductible limit | $ | $ 250,000 | ||
Delaware Cases | Quest Integrity | |||
Loss Contingencies [Line Items] | |||
Number of defendants | 2 | ||
Washington Case | Quest Integrity | |||
Loss Contingencies [Line Items] | |||
Number of defendants | 1 | ||
Con Ed Matter | |||
Loss Contingencies [Line Items] | |||
Liability accrual in excess of the deductible limit for the lawsuits | $ | $ 0 |
SEGMENT AND GEOGRAPHIC DISCLO_3
SEGMENT AND GEOGRAPHIC DISCLOSURES - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2019segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
SEGMENT AND GEOGRAPHIC DISCLO_4
SEGMENT AND GEOGRAPHIC DISCLOSURES - Segment Data for our Three Operating Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||||
Segment Reporting Information [Line Items] | |||||||
Revenues | [1] | $ 290,079 | $ 290,856 | $ 875,507 | $ 937,130 | ||
Operating income (loss) | (1,840) | (19,694) | (5,364) | (32,020) | |||
Capital expenditures | 9,266 | [2] | 7,312 | 24,768 | [2] | 19,394 | |
Depreciation and amortization | 12,050 | 16,032 | 36,700 | 48,466 | |||
IHT | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenues | 126,379 | 147,529 | 392,093 | 467,621 | |||
MS | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenues | 135,625 | 119,011 | 402,048 | 400,890 | |||
Quest Integrity | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenues | 28,075 | 24,316 | 81,366 | 68,619 | |||
Operating segments | IHT | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenues | 126,379 | 147,529 | 392,093 | 467,621 | |||
Operating income (loss) | 6,640 | 8,754 | 17,858 | 28,775 | |||
Capital expenditures | 2,588 | [2] | 1,537 | 5,639 | [2] | 5,935 | |
Depreciation and amortization | 4,390 | 4,649 | 13,293 | 14,179 | |||
Operating segments | MS | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenues | 135,625 | 119,011 | 402,048 | 400,890 | |||
Operating income (loss) | 15,871 | (9,086) | 41,722 | 4,014 | |||
Capital expenditures | 3,795 | [2] | 4,930 | 8,382 | [2] | 8,955 | |
Depreciation and amortization | 5,411 | 8,911 | 16,343 | 27,133 | |||
Operating segments | Quest Integrity | |||||||
Segment Reporting Information [Line Items] | |||||||
Revenues | 28,075 | 24,316 | 81,366 | 68,619 | |||
Operating income (loss) | 7,122 | 5,255 | 18,090 | 12,100 | |||
Capital expenditures | 1,038 | [2] | 610 | 3,615 | [2] | 2,262 | |
Depreciation and amortization | 814 | 1,025 | 2,734 | 2,990 | |||
Corporate and shared support services | |||||||
Segment Reporting Information [Line Items] | |||||||
Operating income (loss) | (31,473) | (24,617) | (83,034) | (76,909) | |||
Capital expenditures | 1,845 | [2] | 235 | 7,132 | [2] | 2,242 | |
Depreciation and amortization | $ 1,435 | $ 1,447 | $ 4,330 | $ 4,164 | |||
[1] | Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. | ||||||
[2] | Totals may vary from amounts presented in the condensed consolidated statements of cash flows due to the timing of cash payments. |
SEGMENT AND GEOGRAPHIC DISCLO_5
SEGMENT AND GEOGRAPHIC DISCLOSURES - Geographic Breakdown of Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Revenues from External Customers [Line Items] | |||||
Revenues | [1] | $ 290,079 | $ 290,856 | $ 875,507 | $ 937,130 |
United States | |||||
Revenues from External Customers [Line Items] | |||||
Revenues | [1] | 204,659 | 207,655 | 641,330 | 683,804 |
Canada | |||||
Revenues from External Customers [Line Items] | |||||
Revenues | [1] | 37,412 | 32,525 | 92,063 | 111,057 |
Europe | |||||
Revenues from External Customers [Line Items] | |||||
Revenues | [1] | 32,180 | 32,746 | 95,558 | 93,442 |
Other foreign countries | |||||
Revenues from External Customers [Line Items] | |||||
Revenues | [1] | $ 15,828 | $ 17,930 | $ 46,556 | $ 48,827 |
[1] | Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
RESTRUCTURING AND OTHER RELAT_3
RESTRUCTURING AND OTHER RELATED CHARGES (CREDITS) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other related charges, net | $ 228 | $ 2,047 | $ 436 | $ 4,458 |
OneTEAM Program | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other related charges, net | 228 | 2,047 | 436 | 4,458 |
Professional fees | 3,800 | 4,300 | 9,800 | 11,800 |
OneTEAM Program | Severance and related costs (credits) | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other related charges, net | 436 | |||
Severance charges incurred cumulatively to date | 7,200 | $ 7,200 | ||
Duration of program-related expenses | 3 years | |||
IHT | OneTEAM Program | Severance and related costs (credits) | Operating segments | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other related charges, net | 0 | 468 | $ 128 | 1,436 |
MS | OneTEAM Program | Severance and related costs (credits) | Operating segments | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other related charges, net | 0 | 408 | 117 | 739 |
Quest Integrity | OneTEAM Program | Severance and related costs (credits) | Operating segments | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other related charges, net | 62 | 7 | 62 | 40 |
Corporate and shared support services | OneTEAM Program | Severance and related costs (credits) | Operating segments | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other related charges, net | $ 166 | $ 1,164 | $ 129 | $ 2,243 |
RESTRUCTURING AND OTHER RELAT_4
RESTRUCTURING AND OTHER RELATED CHARGES (CREDITS) Rollforward of Liability - OneTEAM Program (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Restructuring Reserve [Roll Forward] | ||||
Charges | $ 228 | $ 2,047 | $ 436 | $ 4,458 |
OneTEAM Program | ||||
Restructuring Reserve [Roll Forward] | ||||
Charges | 228 | $ 2,047 | 436 | $ 4,458 |
Severance and related costs (credits) | OneTEAM Program | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance, beginning of period | 2,283 | |||
Charges | 436 | |||
Payments | (2,205) | |||
Balance, end of period | $ 514 | $ 514 |