Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 04, 2022 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-08604 | |
Entity Registrant Name | TEAM, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 74-1765729 | |
Entity Address, Address Line One | 13131 Dairy Ashford | |
Entity Address, Address Line Two | Suite 600 | |
Entity Address, City or Town | Sugar Land | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77478 | |
City Area Code | 281 | |
Local Phone Number | 331-6154 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 43,223,879 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0000318833 | |
Current Fiscal Year End Date | --12-31 | |
Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, $0.30 par value | |
Trading Symbol | TISI | |
Security Exchange Name | NYSE | |
Preferred Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Preferred Stock Purchase Rights | |
Security Exchange Name | NYSE | |
No Trading Symbol Flag | true |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 55,200 | $ 55,200 |
Accounts receivable, net of allowance of $4,805 and $7,843, respectively | 213,684 | 188,772 |
Inventory | 36,992 | 35,754 |
Prepaid expenses and other current assets | 73,954 | 59,868 |
Current assets associated with discontinued operations | 88,670 | 83,096 |
Total current assets | 435,970 | 402,289 |
Property, plant and equipment, net | 155,628 | 161,359 |
Intangible assets, net | 79,954 | 89,898 |
Total assets | 713,689 | 706,544 |
Current liabilities: | ||
Current portion of long-term debt and finance lease obligations | 506,414 | 667 |
Other accrued liabilities | 129,639 | 121,099 |
Current liabilities associated with discontinued operations | 19,375 | 16,396 |
Total current liabilities | 692,064 | 188,267 |
Long-term debt and finance lease obligations | 4,810 | 405,184 |
Total liabilities | 742,419 | 654,677 |
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; 43,223,879 and 31,214,714 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 12,962 | 9,359 |
Additional paid-in capital | 445,839 | 444,824 |
Accumulated deficit | (448,647) | (375,584) |
Accumulated other comprehensive loss | (38,884) | (26,732) |
Total (deficit) equity | (28,730) | 51,867 |
Total liabilities and equity | 713,689 | 706,544 |
Continuing Operations | ||
Current assets: | ||
Cash and cash equivalents | 56,387 | 55,193 |
Accounts receivable, net of allowance of $4,805 and $7,843, respectively | 188,044 | 168,273 |
Inventory | 36,992 | 35,375 |
Income tax receivable | 0 | 4,289 |
Prepaid expenses and other current assets | 65,877 | 56,063 |
Property, plant and equipment, net | 138,497 | 145,480 |
Operating lease right-of-use assets | 48,189 | 58,495 |
Intangible assets, net | 78,580 | 88,318 |
Defined benefit pension asset | 5,402 | 2,902 |
Other assets, net | 7,051 | 9,060 |
Current liabilities: | ||
Accounts payable | 34,921 | 44,056 |
Current portion of long-term debt and finance lease obligations | 506,414 | 667 |
Current portion of operating lease obligations | 13,328 | 15,412 |
Income taxes payable | 1,549 | |
Other accrued liabilities | 116,477 | 111,736 |
Long-term debt and finance lease obligations | 4,810 | 405,184 |
Operating lease obligations | 39,144 | 47,617 |
Deferred income taxes | 3,784 | 3,812 |
Other long-term liabilities | $ 2,617 | $ 9,797 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for credit loss, current | $ 5,866 | $ 8,912 |
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) | 43,223,879 | 31,214,714 |
Common stock, shares, outstanding (in shares) | 43,223,879 | 31,214,714 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |||
Revenues | $ 247,780,000 | $ 217,410,000 | $ 717,621,000 | $ 650,901,000 | ||
Goodwill impairment charge | 0 | 55,837,000 | ||||
Provision for income taxes | (1,500,000) | (7,400,000) | (4,200,000) | (8,400,000) | ||
Discontinued operations: | ||||||
Net income (loss) from discontinued operations, net of income tax | 3,747,000 | (736,000) | 16,268,000 | 3,980,000 | ||
Net loss | $ (22,873,000) | $ (91,182,000) | $ (76,887,000) | [1] | $ (142,966,000) | [1] |
Basic and diluted net loss per common share: | ||||||
Loss from continuing operations, basic (in dollars per share) | $ (0.62) | $ (2.92) | $ (2.25) | $ (4.75) | ||
Loss from continuing operations, diluted (in dollars per share) | (0.62) | (2.92) | (2.25) | (4.75) | ||
Income (loss) from discontinued operations, basic (in dollars per share) | 0.09 | (0.02) | 0.39 | 0.13 | ||
Income (loss) from discontinued operations, diluted (in dollars per share) | 0.09 | (0.02) | 0.39 | 0.13 | ||
Total, basic (in dollars per share) | (0.53) | (2.94) | (1.86) | (4.62) | ||
Total, diluted (in dollars per share) | $ (0.53) | $ (2.94) | $ (1.86) | $ (4.62) | ||
Weighted-average number of shares outstanding: | ||||||
Weighted-average number of basic shares outstanding (in shares) | 43,224 | 30,980 | 41,388 | 30,933 | ||
Weighted-average number of diluted shares outstanding (in shares) | 43,224 | 30,980 | 41,388 | 30,933 | ||
Continuing Operations | ||||||
Revenues | $ 218,339,000 | $ 197,879,000 | $ 628,917,000 | $ 591,043,000 | ||
Operating expenses | 162,322,000 | 153,369,000 | 479,656,000 | 458,237,000 | ||
Gross margin | 56,017,000 | 44,510,000 | 149,261,000 | 132,806,000 | ||
Selling, general and administrative expenses | 57,746,000 | 60,444,000 | 184,174,000 | 182,624,000 | ||
Restructuring and other related charges, net | 0 | 457,000 | 16,000 | 2,317,000 | ||
Goodwill impairment charge | 0 | 55,837,000 | 0 | 55,837,000 | ||
Operating loss | (1,729,000) | (72,228,000) | (34,929,000) | (107,972,000) | ||
Interest expense, net | (26,653,000) | (9,913,000) | (63,708,000) | (28,764,000) | ||
Other income (expense) | 3,227,000 | (904,000) | 9,664,000 | (1,790,000) | ||
Loss from continuing operations before income taxes | (25,155,000) | (83,045,000) | (88,973,000) | (138,526,000) | ||
Provision for income taxes | (1,465,000) | (7,401,000) | (4,182,000) | (8,420,000) | ||
Net loss from continuing operations | $ (26,620,000) | $ (90,446,000) | $ (93,155,000) | $ (146,946,000) | ||
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |||
Statement of Comprehensive Income [Abstract] | ||||||
Net loss | $ (22,873) | $ (91,182) | $ (76,887) | [1] | $ (142,966) | [1] |
Other comprehensive income (loss) before tax: | ||||||
Foreign currency translation adjustment | (7,035) | (3,084) | (12,152) | (2,210) | ||
Other comprehensive loss, before tax | (7,035) | (3,084) | (12,152) | (2,210) | ||
Tax provision attributable to other comprehensive loss | 0 | 691 | 0 | 536 | ||
Other comprehensive income (loss), net of tax | (7,035) | (2,393) | (12,152) | (1,674) | ||
Total comprehensive loss | $ (29,908) | $ (93,575) | $ (89,039) | $ (144,640) | ||
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-in Capital | Additional Paid-in Capital Cumulative Effect, Period of Adoption, Adjustment | Retained Earnings (Deficit) | Retained Earnings (Deficit) Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | |
Beginning balance (in shares) at Dec. 31, 2020 | 30,874 | ||||||||
Beginning balance at Dec. 31, 2020 | $ 214,603 | $ 9,257 | $ 422,589 | $ (189,565) | $ (27,678) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | (34,291) | (34,291) | |||||||
Foreign currency translation adjustment, net of tax | 319 | 319 | |||||||
Non-cash compensation | 2,330 | 2,330 | |||||||
Net settlement of vested stock awards (in shares) | 19 | ||||||||
Net settlement of vested stock awards | (101) | $ 6 | (107) | ||||||
Ending balance (in shares) at Mar. 31, 2021 | 30,893 | ||||||||
Ending balance at Mar. 31, 2021 | 182,860 | $ 9,263 | 424,812 | (223,856) | (27,359) | ||||
Beginning balance (in shares) at Dec. 31, 2020 | 30,874 | ||||||||
Beginning balance at Dec. 31, 2020 | 214,603 | $ 9,257 | 422,589 | (189,565) | (27,678) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | [1] | (142,966) | |||||||
Ending balance (in shares) at Sep. 30, 2021 | 30,980 | ||||||||
Ending balance at Sep. 30, 2021 | 75,437 | $ 9,289 | 428,031 | (332,531) | (29,352) | ||||
Beginning balance (in shares) at Mar. 31, 2021 | 30,893 | ||||||||
Beginning balance at Mar. 31, 2021 | 182,860 | $ 9,263 | 424,812 | (223,856) | (27,359) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | (17,493) | (17,493) | |||||||
Foreign currency translation adjustment, net of tax | 400 | 400 | |||||||
Non-cash compensation | 2,138 | 2,138 | |||||||
Net settlement of vested stock awards (in shares) | 86 | ||||||||
Net settlement of vested stock awards | 0 | $ 26 | (26) | ||||||
Ending balance (in shares) at Jun. 30, 2021 | 30,979 | ||||||||
Ending balance at Jun. 30, 2021 | 167,905 | $ 9,289 | 426,924 | (241,349) | (26,959) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | (91,182) | (91,182) | |||||||
Foreign currency translation adjustment, net of tax | (2,393) | (2,393) | |||||||
Non-cash compensation | 1,108 | 1,108 | |||||||
Net settlement of vested stock awards (in shares) | 1 | ||||||||
Net settlement of vested stock awards | (1) | (1) | |||||||
Ending balance (in shares) at Sep. 30, 2021 | 30,980 | ||||||||
Ending balance at Sep. 30, 2021 | 75,437 | $ 9,289 | 428,031 | (332,531) | (29,352) | ||||
Beginning balance (in shares) at Dec. 31, 2021 | 31,215 | ||||||||
Beginning balance at Dec. 31, 2021 | 51,867 | $ (1,827) | $ 9,359 | 444,824 | $ (5,651) | (375,584) | $ 3,824 | (26,732) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | (32,462) | (32,462) | |||||||
Issuance of common stock (in shares) | 11,905 | ||||||||
Issuance of common stock | 9,768 | $ 3,572 | 6,196 | ||||||
Foreign currency translation adjustment, net of tax | 346 | 346 | |||||||
Non-cash compensation (in shares) | 2 | ||||||||
Non-cash compensation | (624) | (624) | |||||||
Net settlement of vested stock awards | 2 | 2 | |||||||
Ending balance (in shares) at Mar. 31, 2022 | 43,122 | ||||||||
Ending balance at Mar. 31, 2022 | $ 27,070 | $ 12,931 | 444,747 | (404,222) | (26,386) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Adjustments for prior periods from adopting ASU 2020-06 | ASU 2020-06 (ASC 470-20) | ||||||||
Beginning balance (in shares) at Dec. 31, 2021 | 31,215 | ||||||||
Beginning balance at Dec. 31, 2021 | $ 51,867 | $ (1,827) | $ 9,359 | 444,824 | $ (5,651) | (375,584) | $ 3,824 | (26,732) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | [1] | (76,887) | |||||||
Ending balance (in shares) at Sep. 30, 2022 | 43,224 | ||||||||
Ending balance at Sep. 30, 2022 | (28,730) | $ 12,962 | 445,839 | (448,647) | (38,884) | ||||
Beginning balance (in shares) at Mar. 31, 2022 | 43,122 | ||||||||
Beginning balance at Mar. 31, 2022 | 27,070 | $ 12,931 | 444,747 | (404,222) | (26,386) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | (21,552) | (21,552) | |||||||
Issuance of common stock (in shares) | 102 | ||||||||
Issuance of common stock | (71) | $ 31 | (102) | ||||||
Foreign currency translation adjustment, net of tax | (5,463) | (5,463) | |||||||
Non-cash compensation | 565 | 565 | |||||||
Ending balance (in shares) at Jun. 30, 2022 | 43,224 | ||||||||
Ending balance at Jun. 30, 2022 | 549 | $ 12,962 | 445,210 | (425,774) | (31,849) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net loss | (22,873) | ||||||||
Foreign currency translation adjustment, net of tax | (7,035) | ||||||||
Non-cash compensation | 629 | 629 | |||||||
Ending balance (in shares) at Sep. 30, 2022 | 43,224 | ||||||||
Ending balance at Sep. 30, 2022 | $ (28,730) | $ 12,962 | $ 445,839 | $ (448,647) | $ (38,884) | ||||
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | ||
Cash flows (used in) provided by operating activities: | |||
Net loss | [1] | $ (76,887,000) | $ (142,966,000) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | [1] | 28,591,000 | 31,416,000 |
Write-off of deferred financing costs | [1] | 2,748,000 | 0 |
Amortization of deferred financing costs, debt issuance costs, and debt warrant discounts | [1] | 25,666,000 | 6,388,000 |
Paid-in-kind interest | [1] | 15,464,000 | 0 |
Allowance for credit losses | [1] | (362,000) | 1,985,000 |
Foreign currency losses | [1] | 571,000 | 4,274,000 |
Deferred income taxes | [1] | 382,000 | 5,083,000 |
(Gain) loss on asset disposals | [1] | (4,296,000) | 17,000 |
Goodwill impairment charges | 0 | 55,837,000 | |
Non-cash compensation costs | [1] | 571,000 | 5,576,000 |
Other, net | [1] | (3,469,000) | (3,629,000) |
Changes in operating assets and liabilities: | |||
Accounts receivable | [1] | (31,313,000) | (14,817,000) |
Inventory | [1] | (3,076,000) | (334,000) |
Prepaid expenses and other current assets | [1] | (7,048,000) | 3,700,000 |
Accounts payable | [1] | (6,038,000) | 6,012,000 |
Other accrued liabilities | [1] | 5,911,000 | 5,321,000 |
Income taxes | [1] | 6,220,000 | 276,000 |
Net cash used in operating activities | [1] | (46,365,000) | (35,861,000) |
Cash flows used in investing activities: | |||
Capital expenditures | [1] | (21,002,000) | (12,376,000) |
Proceeds from disposal of assets | [1] | 7,165,000 | 154,000 |
Net cash used in investing activities | [1] | (13,837,000) | (12,222,000) |
Cash flows (used in) provided by financing activities: | |||
Borrowings under ABL Credit Facility (Eclipse) | [1] | 106,531,000 | 0 |
Payments under ABL Credit Facility (Eclipse) | [1] | (11,715,000) | 0 |
Borrowings under Corre Delayed Draw Term Loans (ABL Credit Facility (Corre)) | [1] | 35,000,000 | 0 |
Borrowings under ABL Facility (Citibank), net | [1] | 0 | 46,300,000 |
Borrowings under ABL Facility (Citibank), gross | [1] | 10,300,000 | 124,700,000 |
Payments under ABL Facility (Citibank), gross | [1] | (72,300,000) | (125,900,000) |
Payments for debt issuance costs | [1] | (13,609,000) | (2,899,000) |
Issuance of common stock | [1] | 9,696,000 | 0 |
Taxes paid related to net share settlement of share-based awards | [1] | 0 | (102,000) |
Other | [1] | (615,000) | (356,000) |
Net cash provided by financing activities | [1] | 63,288,000 | 41,743,000 |
Effect of exchange rate changes on cash and cash equivalents | [1] | (1,373,000) | (1,274,000) |
Net increase (decrease) in cash and cash equivalents | [1] | 1,713,000 | (7,614,000) |
Cash and cash equivalents at beginning of period | [1] | 65,315,000 | 24,586,000 |
Cash and cash equivalents at end of period | [1] | $ 67,028,000 | $ 16,972,000 |
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 30, 2021 | |
Cash and cash equivalents | [1] | $ 67,028 | $ 16,972 |
Continuing Operations | |||
Cash and cash equivalents | 56,387 | 12,009 | |
Discontinued Operations | |||
Cash and cash equivalents | $ 10,641 | $ 4,963 | |
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES | 9 Months Ended |
Sep. 30, 2022 | |
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 “we”, “our”, “us”, and “Team” are used in this report to refer to either Team, Inc., to one or more of its consolidated subsidiaries or to all of them taken as a whole. We are a global leading provider of integrated, digitally-enabled asset performance assurance and optimization solutions. We deploy conventional to highly specialized inspection, condition assessment, maintenance and repair services that result in greater safety, reliability and operational efficiency for our clients’ most critical assets. Prior to the sale of our Quest Integrity segment (“Quest Integrity”) as discussed below, we conducted operations in three segments: Inspection and Heat Treating (“IHT”), Mechanical Services (“MS”) and Quest Integrity. We currently conduct operations in two segments. Through the capabilities and resources in these two segments, we believe that we are uniquely qualified to provide integrated solutions: 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, we are capable of scaling 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 asset integrity and reliability management solutions available in the industry. We also believe that we are unique in our 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. On November 1, 2022, we completed the sale of all of the issued and outstanding equity interests of our wholly-owned subsidiary, TQ Acquisition Inc., a Texas corporation (“TQ Acquisition”), to Baker Hughes Holdings LLC (“Baker Hughes”) for an aggregate purchase price of approximately $279 million, reflecting certain estimated post-closing adjustments (the “Quest Integrity Transaction”), pursuant to that certain Equity Purchase Agreement by and among us and Baker Hughes, dated as of August 14, 2022 (the “Sale Agreement”). TQ Acquisition and its subsidiaries constituted Quest Integrity, which provided integrity and reliability management solutions for the process, pipeline and power sectors. In connection with the Quest Integrity Transaction, the credit support in the form of guarantees and liens on assets, as applicable, of TQ Acquisition and its subsidiaries in respect of our existing debt arrangements were released. We used approximately $238 million of the net proceeds from the Quest Integrity Transaction to pay down $225.0 million term debt and certain fees associated with that repayment and related accrued interest, with the remainder reserved for general corporate purposes, thereby reducing our future debt service obligations and leverage, and improving our liquidity. As of September 30, 2022, the criteria for reporting Quest Integrity as a discontinued operation were met and, as such, all periods presented in this Form 10-Q have been recast to present Quest Integrity as a discontinued operation. Unless otherwise specified, the financial information and discussion in this Form 10-Q are based on our continuing operations (IHT and MS segments) and exclude any results of our discontinued operations (Quest Integrity). Refer to Note 2 - Discontinued Operations for additional details. IHT provides conventional and advanced non-destructive testing (“NDT”) services primarily for the process, pipeline and power sectors, and pipeline integrity management services, and field heat treating and thermal services, tank management solutions, and pipeline integrity solutions, as well as associated engineering and condition assessment services. These services can be offered while facilities are running (on-stream), during facility turnarounds or during new construction or expansion activities. IHT also provides advanced digital imaging including remote digital video imaging and laser scanning services. MS provides solutions designed to serve clients’ unique needs during both the operational (onstream) and off-line states of their assets. Our onstream services include our range of standard to custom-engineered leak repair and composite solutions; emissions control and compliance; hot tapping and line stopping; and on-line valve insertion solutions, which are delivered while assets are in an operational condition, which maximizes client production time. Asset shutdowns can be planned, such as a turnaround maintenance event, or unplanned, such as those due to component failure or equipment breakdowns. Our specialty maintenance, turnaround and outage services are designed to minimize client downtime and are primarily delivered while assets are off-line and often through the use of cross-certified technicians, whose multi-craft capabilities deliver the production needed to achieve tight time schedules. These critical services include on-site field machining; bolted-joint integrity; vapor barrier plug testing; and valve management solutions. Prior to its sale, Quest Integrity provided integrity and reliability management solutions for the process, pipeline and power sectors. These solutions encompass two broadly-defined disciplines: (1) highly specialized in-line inspection services for historically unpiggable process piping and pipelines using proprietary in-line inspection tools and analytical software; and (2) advanced engineering and condition assessment services through a multi-disciplined engineering team and related lab support. As referenced previously, Quest Integrity is now reported as discontinued operations. We market our services to companies in a diverse array of heavy industries which include: • Energy (refining, power, renewables, nuclear and liquefied natural gas); • Manufacturing and Process (chemical, petrochemical, pulp and paper industries, manufacturing, automotive and mining); • Midstream and Others (valves, terminals and storage, pipeline and offshore oil and gas); • Public Infrastructure (amusement parks, bridges, ports, construction and building, roads, dams and railways); and • Aerospace and Defense. Ongoing Effects of COVID-19. The COVID-19 pandemic has impacted our workforce and operations, as well as the operations of our clients, suppliers and contractors. We continue to be affected by the direct and indirect impact of the pandemic and global economic conditions on operating expenses, staffing and supply chain management. Cares Act. Under the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), we qualified to defer the employer portion of social security taxes incurred through the end of calendar 2020. As of December 31, 2021 we had $14.1 million of deferred employer payroll taxes outstanding and we paid $7.0 million of the deferred payroll taxes in January 2022. The remaining balance of $7.1 million is due at the end of 2022, and includes a $0.5 million balance due by discontinued operations. Additionally, other governments in jurisdictions where we operate passed legislation to provide employers with relief programs, which include wage subsidy grants, deferral of certain payroll related expenses and tax payments and other benefits. We elected to treat qualified government subsidies from Canada and other governments as offsets to the related expenses. As these other governments review compliance with their relief programs, we may be required to return a portion of these funds. During the three months ended September 30, 2022, we did not receive any related government subsidies. During the three months ended September 30, 2021, we recognized a $1.8 million and $0.3 million reduction to our operating expenses and selling, general and administrative expenses, respectively. We recognized a reduction of $0.6 million and $0.1 million to our operating expenses and our selling, general and administrative expenses, respectively, related to these programs during the nine months ended September 30, 2022, and $5.6 million and $1.0 million, respectively, during the nine months ended September 30, 2021 related to these programs. Inflation. Inflation rates and currency exchange rates continue to have an effect on worldwide economies and, consequently, on the way the Company operates. The Company continues to monitor these situations and take appropriate actions. In the face of increasing costs, the Company strives to maintain its profit margins through cost reduction programs, productivity improvements and periodic price increases. We are carefully monitoring impacts from inflation, supply chain challenges and slowing economic conditions. For further information regarding the risks we face relating to inflation, see “Risk Factors - We may experience inflationary pressures in our operating costs and cost overruns on our projects” in our Annual Report on Form 10-K for the year ended December 31, 2021. Ukraine Conflict. The Company does not have employees or operations in Russia or Ukraine. Sanctions and other trade controls imposed by the United States (U.S.) and other governments in response to Russia’s military operations in Ukraine could impact our supply chain in future periods. While it is difficult to estimate the impact of current or future sanctions on the Company’s business and financial position, these sanctions could adversely impact the Company’s sales, cost of procuring raw materials, or distribution costs in future periods. Basis for presentation. These condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) and the rules and regulations of the Securities and Exchange Commission. In the opinion of management, these unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of results for such periods. 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. These financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the Securities and Exchange Commission. Consolidation. The condensed consolidated financial statements include the accounts of our subsidiaries where we have control over operating and financial policies. All material intercompany accounts and transactions have been eliminated in consolidation. Related Party Transactions. A related party transaction is any transaction, arrangement or relationship or series of similar transactions, arrangements or relationships (including the incurrence or issuance of any indebtedness or the guarantee of indebtedness) in which (1) the Company or any of its subsidiaries is a participant, and (2) any Related Party (as defined below) has or will have a direct or indirect material interest. A Related Party is any person who is, or, at any time since the beginning of the Company’s last fiscal year, was (1) an executive officer, director or nominee for election as a director of the Company or any of its subsidiaries, (2) a person with greater than five percent (5%) beneficial interest in the Company, (3) an immediate family member of any of the individuals or entities identified in (1) or (2) of this paragraph, and (4) any firm, corporation or other entity in which any of the foregoing individuals or entities is employed or is a general partner or principal or in a similar position or in which such person or entity has a five percent (5%) or greater beneficial interest. Immediate family members includes a person’s spouse, parents, stepparents, children, stepchildren, siblings, mothers- and fathers-in-law, sons- and daughters-in-law, brothers- and sisters-in-law and anyone residing in such person’s home, other than a tenant or employee. Liquidity and Going Concern. These condensed consolidated financial statements have been prepared in accordance with GAAP and assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the twelve-month period following the issue date of these unaudited condensed consolidated financial statements. Our ability to continue as a going concern is dependent on many factors, including among other things, our ability to comply with the covenants in our debt agreements, our ability to cure any defaults that occur under our debt agreements, or forbearances with respect to any such defaults, and our ability to pay, retire, amend, replace or refinance our indebtedness as defaults occur or as interest and principal payments come due. Liquidity risk is the risk that we will be unable to meet our financial obligations as they become due. Our liquidity may be affected by improvements and declines in commodity prices, our segments’ operational performance, and our ability to access capital and credit markets. We evaluated our liquidity within one year after the date of issuance of these unaudited condensed consolidated financial statements to determine if there is substantial doubt about the Company’s ability to continue as a going concern. In the preparation of this liquidity assessment, we applied judgment to estimate the projected cash flows of the Company, including the following: (i) projected cash outflows, (ii) projected cash inflows, and (iii) availability under the Company’s existing debt arrangements. The cash flow projections were based on known or planned cash requirements for operating and financing costs and include management’s best estimate regarding future customer activity levels, pricing for its services and for its supplies and other factors. Actual results could vary significantly from those projections. We do not believe, based on the Company’s forecast, that current working capital, cash flow from operations, and capital expenditure financing is sufficient to fund the operations, maintain compliance with our debt covenants (as amended), and satisfy the Company’s obligations, specifically with respect to the Notes described below, as they come due within one year after the date of issuance of these condensed consolidated financial statements. Our 5.00% Convertible Senior Notes are due on August 1, 2023 (the “Notes”) and had a principal balance of $97.4 million as of September 30, 2022, which was subsequently reduced to $41.2 million as a result of the exchange transactions described in Note 12 - Debt. We are exploring alternatives to reduce or refinance the Notes outstanding balance, including extending their maturity as well as other alternatives. However, there is no assurance that we will be able to execute a reduction, extension, or refinancing of the Notes or that the terms of any replacement financing would be as favorable as the terms of the Notes prior to the maturity date. Under the terms of our amended financing arrangements that were entered into during 2022, the Maturity Reserve Trigger Date, as defined in the ABL Credit Agreement (as defined herein), and the Maturity Trigger Date as defined in the Term Loan Credit Agreement (as defined herein), collectively referred to as the “Trigger Date” was May 18, 2023, which has subsequently been amended to June 17, 2023, see to Note 12 - Debt for additional information. Therefore, the Notes balance must be paid down to $10.0 million by June 17, 2023, or the Company must have equivalent cash on hand to pay down the balance of the Notes to $10.0 million. The failure to pay down the Notes by the Trigger Date would be an event of default under our Term Loan Credit Agreement (as defined herein), Subordinated Term Loan Credit Agreement (as defined herein), ABL Credit Facility, and Corre Delayed Draw Term Loan (as defined herein) since these instruments contain cross default provisions, resulting in these debt instruments becoming payable on demand. Refer to Note 12 - Debt for more information on the terms and maturity dates of our debt that may affect our future liquidity. On October 4, 2022, we entered into Amendment No. 8 (“Amendment No. 8”) to the Subordinated Term Loan Credit Agreement (as defined below). See Note 12 - Debt for additional details. On November 1, 2022, we completed the Quest Integrity Transaction with Baker Hughes, as discussed above, for an aggregate purchase price of approximately $279 million, reflecting certain estimated post-closing adjustments, in accordance with the Sale Agreement. We used the net proceeds from the sale of Quest Integrity to pay down $225.0 million term debt and certain fees associated with that repayment and related accrued interest, with the remainder reserved for general corporate purposes, thereby reducing our future debt service obligations and leverage, and improving our liquidity. On November 4, 2022, we entered into Amendment No. 9 (“Amendment No.9”) to the Term Loan Credit Agreement and Amendment No. 10 (“Amendment No. 10”) to the Subordinated Term Loan Credit Agreement. See Note 12 - Debt for additional details. As of September 30, 2022, we are in compliance with our debt covenants. However, without the consummation of a refinancing transaction or agreement to extend the Notes maturity date, there is a risk that the Company could be, among other things, unable to make principal payments on the Notes to satisfy the Trigger Date provision, or will be unable to pay off convertible debt when it becomes due on August 1, 2023. Failure to pay down the principal on the Notes to $10.0 million by June 17, 2023, or pay it off at the maturity date on August 1, 2023 will result in an event of default and the associated cross defaults noted above under the Company’s other debt instruments. As a result of our current financial resources and no guarantee that we will be able to obtain an extension or amend the financial covenants, substantial doubt exists that we have the ability to continue as a going concern. We are evaluating and will continue to explore strategic alternatives to a refinancing transaction or the reduction of the debt, including negotiating amendments to our credit facilities and the financial covenants contained therein, the sale of assets, or other alternative financing transactions. While our lenders agreed on an extension and amended the financial covenants in prior periods, there can be no assurance that our lenders will provide additional extensions, waivers or amendments in the event of future non-compliance with our debt covenants, or other possible events of default. The unaudited condensed consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern . Use of estimates. Our accounting policies conform to GAAP. The preparation of condensed 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 condensed 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) selecting assumptions used in the measurement of costs and liabilities associated with defined benefit pension plans, (8) assessments of fair value and (9) managing our foreign currency risk in foreign operations. Our most significant accounting policies are described below. Fair value of financial instruments . As defined in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820 Fair Value Measurements and Disclosur e (“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 inputs that are unobservable and of a highly subjective measure. 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 ABL Credit Facility and Term Loans 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 debt. The fair value of our Notes as of September 30, 2022 and December 31, 2021 is $97.4 million and $84.0 million, respectively, (inclusive of the fair value of the conversion option) and are a “Level 2” measurement, determined based on the observed trading price of these instruments. For additional information regarding our ABL Credit Facilities, Atlantic Park Term Loan, Subordinated Term Loan and Notes, see Note 12 - Debt . Cash and cash equivalents . Cash and cash equivalents consist of all deposits and funds invested in highly liquid short-term investments with original maturities of three months or less. Inventory. Except for certain inventories that are valued based on weighted-average cost, we use the first-in, first-out method to value our inventory. Inventory includes material, labor, and certain fixed overhead costs. Inventory is stated at the lower of cost and net realizable value. Inventory quantities on hand are reviewed periodically and carrying cost is reduced to net realizable value for inventories for which their cost exceeds their utility. The cost of inventories consumed or products sold are included in operating expenses. Property, plant and equipment. Property, plant and equipment are stated at cost less accumulated depreciation and amortization. Leasehold improvements are amortized over the shorter of their respective useful life or the lease term. Depreciation and amortization of assets are computed by the straight-line method over the following estimated useful lives of the assets: Classification Useful Life Buildings 20-40 years Enterprise Resource Planning (“ERP”) System 15 years Leasehold improvements 2-15 years Machinery and equipment 2-12 years Furniture and fixtures 2-10 years Computers and computer software 2-5 years Automobiles 2-5 years Goodwill and intangible assets. Goodwill and intangible assets acquired in a business combination determined to have an indefinite useful life are not amortized, but are instead tested for impairment, and assessed for potential triggering events, at least annually in accordance with the provisions of the ASC 350 Intangibles—Goodwill and Other (“ASC 350”). Intangible assets with finite lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed for impairment in accordance with ASC 360- 10 Impairment or Disposal of Long-Lived Assets (“ASC 360”). We assess goodwill for impairment at the reporting unit level, which we have determined to be the same as our operating segments. As of September 30, 2022 and December 31, 2021, there was no goodwill on the Company’s balance sheets related to continuing operations. The only segment with goodwill was Quest Integrity, which is included in discontinued operations. If the carrying value of a reporting unit exceeds its fair value, we measure any 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 test our goodwill for impairment annually on December 1 of each year and whenever we become aware of an event or a change in circumstances that would indicate the carrying value may be impaired. There was no goodwill impairment recorded for the nine months ended September 30, 2022. Goodwill impairment of $55.8 million was recorded for the three months and nine months ended September 30, 2021 in our continuing operations related to our MS operating segment. Income taxes. We follow the guidance of ASC 740 Income Taxes (“ASC 740”), which requires that we use the asset and liability method of accounting for deferred income taxes and provide deferred income taxes for all significant temporary differences. As part of the process of preparing our condensed consolidated financial statements, we are required to estimate our income taxes in each of the jurisdictions in which we operate. This process involves estimating our actual current tax payable or receivable and related tax expense or benefit together with assessing temporary differences resulting from differing treatment of certain items, such as depreciation, for tax and accounting purposes. These differences can result in deferred tax assets and liabilities, which are included within our consolidated balance sheets. In accordance with ASC 740, we are required to assess the likelihood that our deferred tax assets will be realized and, to the extent we believe it is more likely than not (a likelihood of more than 50%) that some portion or all of the deferred tax assets will not be realized, we must establish a valuation allowance. We consider all available evidence to determine whether, based on the weight of the evidence, a valuation allowance is needed. Evidence used includes the reversal of existing taxable temporary differences, taxable income in prior carryback years if carryback is permitted by tax law, information about our current financial position and our results of operations for the current and preceding years, as well as all currently available information about future years, including our anticipated future performance and tax planning strategies. We regularly assess whether it is more likely than not that we will realize the deferred tax assets in the jurisdictions in which we operate. Management believes future sources of taxable income, reversing temporary differences and other tax planning strategies will be sufficient to realize the deferred tax assets for which no valuation allowance has been established. Our valuation allowance primarily relates to net operating loss carryforwards. While we have considered these factors in assessing the need for additional valuation allowance, there can be no assurance that additional valuation allowance would not need to be established in the future if information about future years change. Any changes in valuation allowance would impact our income tax provision and net income (loss) in the period in which such a determination is made. Significant judgment is required in assessing the timing and amounts of deductible and taxable items for tax purposes. In accordance with ASC 740-10, we establish reserves for uncertain tax positions when, despite our belief that our tax return positions are supportable, we believe that it is not more likely than not that the position will be sustained upon challenge. When facts and circumstances change, we adjust these reserves through our provision for income taxes. To the extent interest and penalties may be assessed by taxing authorities on any related underpayment of income tax, such amounts have been accrued and are classified as a component of income tax expense (benefit) in our consolidated statements of operations. Workers’ compensation, auto, medical and general liability accruals. In accordance with ASC 450 Contingencies (“ASC 450”), we record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We review our loss contingencies on an ongoing basis to ensure that we have appropriate reserves recorded on our balance sheet. These reserves are based on historical experience with claims incurred but not received, estimates and judgments made by management, applicable insurance coverage for litigation matters, and are adjusted as circumstances warrant. For workers’ compensation, our self-insured retention is $1.0 million and our automobile liability deductible is $2.0 million per occurrence. For general liability claims, we have a deductible of $1.0 million and a self-insured retention of $5.0 million per occurrence. For medical claims, our self-insured retention is $0.4 million per individual claimant determined on an annual basis. For environmental liability claims, our self-insured retention is $1.0 million per occurrence. We maintain insurance for claims that exceed such self-retention limits. The insurance is subject to terms, conditions, limitations, and exclusions that may not fully compensate us for all losses. Our estimates and judgments could change based on new information, changes in laws or regulations, changes in management’s plans or intentions, or the outcome of legal proceedings, settlements, or other factors. If different estimates and judgments were applied with respect to these matters, it is likely that reserves would be recorded for different amounts. Allowance for credit losses. 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 credit losses 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 income (loss) from continuing operations, income (loss) from discontinued operations or net income (loss) by the weighted-average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing income (loss) from continuing operations, i |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 9 Months Ended |
Sep. 30, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On November 1, 2022, we completed the Quest Integrity Transaction with Baker Hughes for an aggregate purchase price of approximately $279 million, reflecting certain estimated post-closing adjustments, in accordance with the Sale Agreement. We used the net proceeds from the sale of Quest Integrity to pay down $225.0 million of term debt and certain fees associated with that repayment and related accrued interest, with the remainder reserved for general corporate purposes, thereby reducing our future debt service obligations and leverage, and improving our liquidity. Quest Integrity previously represented a reportable segment. Following the completion of the Quest Integrity Transaction, we now operate in two segments, IHT and MS. Refer to Note 1 – Summary of Significant Accounting Policies and Practices for additional details regarding the Quest Integrity Transaction. Our condensed consolidated balance sheets and condensed consolidated statements of operations report discontinued operations separate from continuing operations. Our condensed consolidated statements of comprehensive loss, statements of equity and statements of cash flows combine continuing and discontinued operations. A summary of financial information related to our discontinued operations is presented in the tables below. The table below represents the reconciliation of the major line items consisting of pretax income from discontinued operations to the after-tax income from discontinued operations (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Major classes of line items constituting income (loss) from discontinued operations Revenues $ 29,441 $ 19,531 $ 88,704 $ 59,858 Operating expenses (12,052) (10,720) (39,508) (32,878) Selling, general and administrative expenses (8,832) (7,109) (26,422) (19,531) Restructuring and other related charges, net — — — (297) Interest expense, net (78) (61) (108) (204) Other expense (2,675) (856) (4,934) (1,964) Income before income taxes from discontinued operations 5,804 785 17,732 4,984 Provision for income taxes (2,057) (1,521) (1,464) (1,004) Net income (loss) from discontinued operations $ 3,747 $ (736) $ 16,268 $ 3,980 The table below represents the reconciliation of the major classes of assets and liabilities of the discontinued operations to amounts presented separately in the condensed consolidated balance sheets (in thousands): September 30, 2022 December 31, 2021 (unaudited) Carrying amount of major classes of assets included as part of discontinued operations Cash and cash equivalents $ 10,641 $ 10,122 Accounts receivable, net 25,640 20,499 Prepaid expenses and other current assets 8,077 3,805 Property, plant and equipment, net 17,131 15,879 Goodwill and intangible assets, net 25,311 26,823 Other classes of assets that are not major 1,870 5,968 Total assets associated with discontinued operations $ 88,670 $ 83,096 Carrying amounts of major classes of liabilities included as part of discontinued operations Accounts payable $ 1,923 $ 2,125 Other accrued liabilities 13,162 9,363 Operating lease obligations 1,812 2,368 Other classes of liabilities that are not major 2,478 2,540 Total liabilities associated with discontinued operations $ 19,375 $ 16,396 The assets and liabilities in discontinued operations are measured at the lower of their carrying value and fair value less cost to sell. During the three months and nine months ended September 30, 2022, it was not necessary to write-down any assets or liabilities attributable to the disposal group in discontinued operations to fair value, less costs to sell. Quest Integrity had $0.02 million and $0.3 million of accrued capital expenditures as of September 30, 2022 and September 30, 2021, respectively, which are excluded from the condensed consolidated statements of cash flows until paid. The following table presents the depreciation and amortization and capital expenditures of Quest Integrity (in thousands): Nine Months Ended September 30, 2022 2021 Cash flows provided by operating activities of discontinued operations: Depreciation and amortization $ 1,143 $ 2,016 Cash flows provided by investing activities of discontinued operations: Capital expenditures $ 3,703 $ 2,365 |
REVENUE
REVENUE | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE In accordance with ASC Topic 606, Revenue from Contracts with Customers , (“ASC 606”) 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 may 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. Generally, in contracts where the amount of consideration is variable, the amount is determinable each period based on our right to invoice (as discussed further below) the customer for services performed to date. As most of our contracts contain only one performance obligation, the allocation of a contract 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 twelve months or less from the date of service. 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. 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): Geographic area: Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 108,009 $ 2,303 $ 110,312 $ 98,812 $ 2,664 $ 101,476 MS 76,135 31,892 108,027 63,885 32,518 96,403 Total $ 184,144 $ 34,195 $ 218,339 $ 162,697 $ 35,182 $ 197,879 Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 312,928 $ 7,105 $ 320,033 $ 302,871 $ 7,206 $ 310,077 MS 217,749 91,135 308,884 189,234 91,732 280,966 Total $ 530,677 $ 98,240 $ 628,917 $ 492,105 $ 98,938 $ 591,043 Operating segment and service type: Three Months Ended September 30, 2022 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 87,267 $ 19 $ 16,357 $ 6,669 $ 110,312 MS — 106,776 125 1,126 108,027 Total $ 87,267 $ 106,795 $ 16,482 $ 7,795 $ 218,339 Three Months Ended September 30, 2021 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 80,553 $ 56 $ 11,928 $ 8,939 $ 101,476 MS — 95,560 71 772 96,403 Total $ 80,553 $ 95,616 $ 11,999 $ 9,711 $ 197,879 Nine Months Ended September 30, 2022 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 255,419 $ 158 $ 45,983 $ 18,473 $ 320,033 MS — 305,277 238 3,369 308,884 Total $ 255,419 $ 305,435 $ 46,221 $ 21,842 $ 628,917 Nine Months Ended September 30, 2021 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 244,374 $ 344 $ 42,650 $ 22,709 $ 310,077 MS — 278,685 768 1,513 280,966 Total $ 244,374 $ 279,029 $ 43,418 $ 24,222 $ 591,043 For additional information on our reportable operating segments and geographic information, refer to Note 18 - Segment and Geographic Disclosures . 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 Note 1 - Summary of Significant Accounting Policies and Practices and Note 4 – Receivables for additional information on our trade receivables and the allowance for credit losses. 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, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Change (unaudited) Trade accounts receivable, net 1 $ 213,684 $ 188,772 $ 24,912 Contract assets 2 $ 2,320 $ 1,602 $ 718 Contract liabilities 3 $ 2,071 $ 313 $ 1,758 Trade accounts receivable, contract assets and contract liabilities - discontinued operations 4 $ 30,000 $ 22,366 $ 7,634 _________________ 1 Includes billed and unbilled amounts, net of allowance for credit losses. See Note 4 - Receivables for details. 2 Portion of continued operations is included in the “Prepaid expenses and other current assets” line on the condensed consolidated balance sheets. 3 Portion of continued operations is included in the “Other accrued liabilities” line of the condensed consolidated balance sheets. 4 The total of trade accounts receivable, contract assets, contract liabilities and net accounts receivable of discontinued operations, which is included in the respective lines above. The $0.7 million increase in our contract assets from December 31, 2021 to September 30, 2022 is due to more fixed price contracts in progress at September 30, 2022 as compared to December 31, 2021. Contract liabilities increased by $1.8 million as of September 30, 2022. The increase is associated with contracts under which customers have paid 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, 2021 was recognized as revenue by the nine months ended September 30, 2022. Contract costs. We recognize 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. Costs to fulfill a contract are recorded as assets if they relate directly to a contract or a specific anticipated contract, the costs are to 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. 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, 2022 and December 31, 2021. 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. |
RECEIVABLES
RECEIVABLES | 9 Months Ended |
Sep. 30, 2022 | |
Receivables [Abstract] | |
RECEIVABLES | RECEIVABLES A summary of accounts receivable as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Trade accounts receivable $ 171,908 $ 161,751 Unbilled receivables 47,642 35,933 Allowance for credit losses (5,866) (8,912) Total 213,684 188,772 Accounts receivable, net - discontinued operations (25,640) (20,499) Accounts receivable, net - continuing operations $ 188,044 $ 168,273 ASC 326, Credit Losses , applies to financial assets measured at amortized cost, including trade and unbilled accounts receivable, and requires immediate recognition of lifetime expected credit losses. Significant factors that affect the expected collectability of our receivables include macroeconomic trends and forecasts in the oil and gas, refining, power, and petrochemical markets and changes in our results of operations and forecasts. For unbilled receivables, we consider them as short-term in nature as they are normally converted to trade receivables within 90 days, thus future changes in economic conditions will not have a significant effect on the credit loss estimate. We have identified the following factors that primarily impact the collectability of our receivables and therefore determine the pools utilized to calculate expected credit losses: (i) the aging of the receivable, (ii) any identification of known collectability concerns with specific receivables, and (iii) variances in economic risk characteristics across geographic regions. For trade receivables, customers typically are provided with payment due date terms of 30 days upon issuance of an invoice. We have tracked historical loss information for our trade receivables and compiled historical credit loss percentages for different aging categories. We believe that the historical loss information we have compiled is a reasonable basis on which to determine expected credit losses for trade receivables because the composition of the trade receivables is consistent with that used in developing the historical credit-loss percentages as typically our customers and payment terms do not change significantly. We update the historical loss information for current conditions and reasonable and supportable forecasts that affect the expected collectability of the trade receivable using a loss-rate approach. We have not seen a negative trend in the current economic environment that significantly impacts our historical credit-loss percentages; however, we will continue to monitor for changes that would indicate the historical loss information is no longer a reasonable basis for the determination of our expected credit losses. Our forecasted loss rates inherently incorporate expected macroeconomic trends. A loss-rate method for estimating expected credit losses on a pooled basis is applied for each aging category for receivables that continue to exhibit similar risk characteristics. To measure expected credit losses for individual receivables with specific collectability risk, we identify specific factors based on customer-specific facts and circumstances that are unique to each customer. Customer accounts with different risk characteristics are separately identified and a specific reserve is determined for these accounts based on the assessed credit risk. We have also identified the following geographic regions in which to distinguish our trade receivables: the (i) United States, (ii) Canada, (iii) the European Union, (iv) the United Kingdom, and (v) other countries. These geographic regions are considered appropriate as they each operate in different economic environments with different foreign currencies, and therefore share similar economic risk characteristics. For each geographic region, we evaluate the historical loss information and determine credit-loss percentages to apply to each aging category and individual receivable with specific risk characteristics. We estimate future expected credit losses based on forecasted changes in gross domestic product and oil demand for each region. We consider one year from the financial statement reporting date as representing a reasonable forecast period as this period aligns with the expected collectability of our trade receivables. Financial distress experienced by our customers could have an adverse impact on us in the event our customers are unable to remit payment for the products or services we provide or otherwise fulfill their obligations to us. In determining the current expected credit losses, we review macroeconomic conditions, market specific conditions, and internal forecasts to identify potential changes in our assessment. The following table shows a rollforward of the allowance for credit losses (in thousands): September 30, 2022 December 31, 2021 (unaudited) Balance at beginning of period $ 8,912 $ 9,918 Expected credit loss adjustment 1 (442) 2,193 Write-offs (2,414) (3,143) Foreign exchange effects (190) (56) Balance at end of period 5,866 8,912 Allowance for credit losses - discontinued operations (1,061) (1,069) Allowance for credit losses - continuing operations $ 4,805 $ 7,843 _________________ 1 Includes $0.7 million and $0.5 million of recoveries on allowance for credit losses, for the nine months ended September 30, 2022 and twelve months ended December 31, 2021, respectively. |
INVENTORY
INVENTORY | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY A summary of inventory as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Raw materials $ 8,811 $ 7,641 Work in progress 3,225 2,725 Finished goods 24,956 25,388 Total 36,992 35,754 Total inventory - discontinued operations — (379) Total inventory - continuing operations $ 36,992 $ 35,375 |
PREPAID AND OTHER CURRENT ASSET
PREPAID AND OTHER CURRENT ASSETS | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID AND OTHER CURRENT ASSETS | PREPAID AND OTHER CURRENT ASSETS A summary of prepaid and other current assets as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Insurance receivable $ 39,000 $ 39,000 Prepaid expenses 17,506 12,645 Other current assets 17,448 8,223 Total 73,954 59,868 Prepaid and other current assets - discontinued operations (8,077) (3,805) Prepaid and other current assets - continuing operations $ 65,877 $ 56,063 The insurance receivable relates to the receivable from our third-party insurance providers for a legal claim that is recorded in other accrued liabilities, refer to Note 10 - Other Accrued Liabilities . These receivables are covered by our third-party insurance providers for any litigation matter that has been settled, or pending settlements where the deductibles have been satisfied. The prepaid expenses primarily relate to prepaid insurance and other expenses that have been paid in advance of the coverage period. The other current assets primarily include items such as contract assets, receivables from third parties, and other non-trade related accounts receivables. As of September 30, 2022 the other current assets include deferred financing cost amounting to $4.8 million due to all long-term debt now being classified as current. Historically these assets were presented in “other assets, net”, and comparative periods were not adjusted. Other current assets also include 1970 Group Inc. (“1970 Group”) deferred financing fees amounting to $2.9 million in connection with that certain Substitute Insurance Reimbursement Facility Agreement dated as of September 29, 2022 (the “Substitute Insurance Reimbursement Facility Agreement”), by and between us and 1970 Group (see Note 12 - Debt for additional details). |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT A summary of property, plant and equipment as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Land $ 4,523 $ 5,743 Buildings and leasehold improvements 53,803 58,972 Machinery and equipment 298,327 306,366 Furniture and fixtures 11,301 11,642 Capitalized ERP system development costs 45,917 45,917 Computers and computer software 22,328 22,243 Automobiles 4,379 4,356 Construction in progress 27,678 16,565 Total 468,256 471,804 Accumulated depreciation (312,628) (310,445) Property, plant and equipment, net 155,628 161,359 Property, plant and equipment, net - discontinued operations (17,131) (15,879) Property, plant and equipment, net - continuing operations $ 138,497 $ 145,480 Included in the table above are assets under finance leases of $7.0 million and $6.7 million, and accumulated amortization of $2.1 million and $1.6 million as of September 30, 2022 and December 31, 2021, respectively. Depreciation expense for the three months ended September 30, 2022 and 2021 was $5.5 million and $6.7 million, respectively. Depreciation expense for the nine months ended September 30, 2022 and 2021 was $18.3 million and $21.0 million, respectively. Assets sold and disposed of for the nine months ended September 30, 2022 and twelve months ended December 31, 2021 had a cost basis of $10.1 million and $2.8 million, respectively. The cost basis of $10.1 million for the nine months ended September 30, 2022 consisted of $5.8 million in machinery and equipment, $2.1 million in buildings, $1.3 million in land, $0.8 million in leasehold improvements and $0.1 million in other assets. The cost basis of $2.8 million for the twelve months ended December 31, 2021 consisted of $2.5 million in machinery and equipment, $0.2 million in vehicles and $0.1 million in other assets. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS A summary of intangible assets as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Gross Accumulated Net Gross Accumulated Net Customer relationships $ 174,400 $ (97,362) $ 77,038 $ 175,156 $ (88,783) $ 86,373 Non-compete agreements 5,288 (5,288) — 5,503 (5,503) — Trade names 24,520 (22,417) 2,103 24,743 (22,252) 2,491 Technology 7,784 (6,998) 786 7,843 (6,885) 958 Licenses 827 (800) 27 850 (774) 76 Total $ 212,819 $ (132,865) $ 79,954 $ 214,095 $ (124,197) $ 89,898 Intangible assets - discontinued operations (19,468) 18,094 (1,374) (20,186) 18,606 (1,580) Intangible assets - continuing operations $ 193,351 $ (114,771) $ 78,580 $ 193,909 $ (105,591) $ 88,318 Amortization expense of intangible assets for the three months ended September 30, 2022 and September 30, 2021 was $3.4 million and $3.4 million, respectively. Amortization expense of intangible assets for the nine months ended September 30, 2022 and September 30, 2021 was $10.2 million and $10.5 million, respectively. Amortization expense for intangible assets is forecast to be approximately $13.1 million per year from 2022 through 2025. |
GOODWILL
GOODWILL | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOOWILL | GOODWILL We did not have any goodwill balance in our IHT or MS segments as of September 30, 2022 or December 31, 2021. See Note 1 - Summary of Significant Accounting Policies and Practices and Note 2 - Discontinued Operations for additional details as the remaining goodwill existed at Quest Integrity. |
OTHER ACCRUED LIABILITIES
OTHER ACCRUED LIABILITIES | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
OTHER ACCRUED LIABILITIES | OTHER ACCRUED LIABILITIES A summary of other accrued liabilities as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Legal and professional accruals $ 47,475 $ 46,762 Payroll and other compensation expenses 50,101 44,284 Insurance accruals 6,820 7,314 Property, sales and other non-income related taxes 6,701 8,018 Accrued commission 1,481 1,111 Accrued interest 8,070 6,469 Other 8,991 7,141 Total $ 129,639 $ 121,099 Other accrued liabilities - discontinued operations (13,162) (9,363) Other accrued liabilities - continuing operations $ 116,477 $ 111,736 Legal and professional accruals include accruals for legal and professional fees as well as accrued legal claims, refer to Note 17 - Commitments and Contingencies . Certain legal claims are covered by insurance and the related insurance receivable for these claims is recorded in prepaid expenses and other current assets, refer to Note 6 - Prepaid and Other Current Assets . Payroll and other compensation expenses include all payroll related accruals including, among others, accrued vacation, severance, and bonuses. Insurance accruals primarily relate to accrued medical and workers compensation costs. Property, sales and other non-income related taxes includes accruals for items such as sales and use tax, property tax and other related tax accruals. Accrued interest relates to the interest accrued on our long-term debt. Other accrued liabilities include items such as contract liabilities and other accrued expenses. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES We recorded an income tax provision of $1.5 million and $4.2 million for the three and nine months ended September 30, 2022 compared to a provision of $7.4 million and $8.4 million for the three and nine months ended September 30, 2021. The effective tax rate, inclusive of discrete items, was a provision of 5.8% for the three months ended September 30, 2022, compared to a provision of 8.9% for the three months ended September 30, 2021. For the nine months ended September 30, 2022, our effective tax rate, inclusive of discrete items, was a provision of 4.7%, compared to a provision of 6.1% for the nine months ended September 30, 2021. The effective tax rate differed from the statutory tax rate due to an increase in the valuation allowance in certain jurisdictions. The effective tax rate in the prior year was also impacted by the tax benefits recognized related to the CARES Act. The substantial doubt about the Company’s ability to continue as a going concern basis casts doubt on our ability to estimate and generate future income. The lack of going concern basis applicable for our third quarter financial statements generally requires a valuation allowance for all deferred tax assets that are not realizable through the reversal of existing timing differences or taxable income in carryback years. While several subsidiaries have historically been profitable and for which future income was a material factor in assessing the realizability of their deferred tax assets, the substantial doubt about the Company’s ability to continue on a going concern basis casts doubt on our ability to generate future income. As a result, the Company included a charge of $0.8 million in income tax expense for the valuation allowance required to offset the remaining net deferred tax assets. The $0.8 million charge is primarily attributable to our Germany and Canada subsidiaries. Refer to Note 1 - Summary of Significant Accounting Policies and Practices for additional liquidity and going concern discussion. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT For the period ended September 30, 2022, debt with original maturities greater than one year are classified as current due to the Trigger Date provision. This provision did not impact classification of debt for the period ended December 31, 2021. Refer to Note 1 - Summary of Significant Accounting Policies and Practices for additional liquidity and going concern discussion. Team’s current and long-term debt obligations consisted of the following (in thousands): September 30, 2022 December 31, 2021 (unaudited) ABL Facilities $ 129,816 $ 62,000 Atlantic Park Term Loan 234,443 214,191 Subordinated Term Loan 46,132 36,358 Total $ 410,391 $ 312,549 Notes 1 95,125 87,662 Finance lease obligations 2 5,708 5,640 Total debt and finance lease obligations $ 511,224 $ 405,851 Current portion of long-term debt and finance lease obligations (506,414) (667) Total long-term debt and finance lease obligations, less current portion $ 4,810 $ 405,184 _________________ 1 Comprised of principal amount outstanding, less unamortized discount and issuance costs. See Convertible Debt section below for additional information. 2 Excludes finance lease obligations associated with discontinued operations. ABL Facilities On February 11, 2022, we entered into a new credit agreement with the lender parties thereto, and Eclipse Business Capital, LLC, a Delaware limited liability company, as agent, (“Eclipse”) (such agreement, the “ABL Credit Agreement”). Available funding commitments to us under the ABL Credit Agreement, subject to certain conditions, include a revolving credit line in an amount of up to $130.0 million to be provided by certain affiliates of Eclipse (the “Revolving Credit Loans”), with a $35.0 million sublimit for swingline borrowings and a $26.0 million sublimit for issuances of letters of credit, and an incremental delayed draw term loan of up to $35.0 million (the “Corre Delayed Draw Term Loans”) provided by Corre Partners Management, LLC and certain of its affiliates (“Corre”) (collectively, the “ABL Credit Facility”). The proceeds of the loans under the ABL Credit Facility were used to, among other things, pay off the amounts owed under that certain asset-based credit agreement (such agreement, as amended, restated, supplemented or otherwise modified from time to time, the “Citi Credit Agreement”) led by Citibank, N.A. (“Citibank”), as agent, which was repaid and terminated in full on February 11, 2022. The ABL Credit Facility matures, and all outstanding amounts become due and payable on February 11, 2025. However, the ABL Credit Facility is subject to the Trigger Date as noted above in Note 1 - Summary of Significant Accounting Policies and Practices . Borrowings under the ABL Facility bear interest through maturity at a variable rate based upon, at our option, an annual rate of either a base rate (“Base Rate”) or a LIBOR rate, plus an applicable margin, as defined in the ABL Credit Agreement. The interest rate at September 30, 2022 was 7.21% for Eclipse and 12.56% for the Corre Delayed Draw Term Loans. Direct and incremental costs associated with the issuance of the ABL Credit Facility were approximately $8.3 million and were capitalized as deferred financing costs. These costs are being amortized on a straight-line basis over the term of the ABL Credit Facility. Unamortized deferred financing cost amounted to $4.8 million and $2.9 million at September 30, 2022 and December 31, 2021, respectively. Additionally, the amortization period for deferred financing costs and debt discounts and issuance cost was updated to reflect the revised maturity date associated with the Trigger date provision and the related reclassification of debt as current. Refer to Note 1 - Summary of Significant Accounting Policies and Practices for additional liquidity and going concern discussion. At September 30, 2022, Team had $94.8 million outstanding under the Revolving Credit Loans and $35.0 million outstanding under the Corre Delayed Draw Term Loans. As of September 30, 2022, subject to the applicable sublimit and other terms and conditions, the remaining $1.9 million of available commitments under the ABL Credit Facility was available for loans or for issuance of new letters of credit. There were $8.9 million outstanding in letters of credit, which is off-balance sheet. Amendments in 2022: On May 6, 2022, we entered into the ABL Credit Agreement Amendment No. 1 which, among other things, modified the Maturity Reserve Trigger Date (as defined in the ABL Credit Agreement and Note 1 - Summary of Significant Accounting Policies and Practices ) such that the date on which a reserve must, subject to certain conditions, be put into place with respect to the outstanding principal amount of the Notes was 75 days prior to their maturity date rather than 120 days or May 18, 2023, by which date, the Notes balance must be paid down to $10.0 million, or the Company must have equivalent cash on hand to pay down the Notes to $10.0 million. In connection with the Quest Integrity Transaction, on November 1, 2022, we, the guarantors party thereto, the lender parties thereto and Eclipse, as agent, entered into Amendment No. 2 to the ABL Credit Agreement (“ABL Credit Agreement Amendment No. 2”) which, among other things, (i) modified the Maturity Reserve Trigger Date (as defined in the ABL Credit Agreement) such that the date on which a reserve must, subject to certain conditions, be put into place with respect to the outstanding principal amount of the Notes is 45 days prior to the maturity date of the Notes rather than 75 days, or June 17, 2023, and (ii) made certain modifications to negative covenants and mandatory prepayment provisions. Atlantic Park Term Loan On December 18, 2020, we entered into a certain Term Loan Credit Agreement (the “Term Loan Credit Agreement”) with Atlantic Park Strategic Capital Fund, L.P., as agent (“APSC”), as lender (the “Term Loan Credit Agreement”), pursuant to which we borrowed a $250.0 million term loan (the “Term Loan” or the “Atlantic Park Term Loan”). The Term Loan was issued with a 3% original issuance discount, such that total proceeds received were $242.5 million. As set forth in the Term Loan Credit Agreement, the Term Loan is secured by substantially all assets, other than those secured on a first lien basis by the ABL Credit Facility, and we may under certain conditions, increase the Term Loan by an amount not to exceed $100.0 million. The Term Loan bears interest through maturity at a variable rate based upon, at our option, an annual rate of either a Base rate or a LIBOR rate, plus an applicable margin. The effective interest rate on the Term Loan at September 30, 2022 and December 31, 2021 was 25.72% and 20.90%, respectively. At September 30, 2022, the effective interest consisted of 10.24% variable interest rate and an additional 15.48% due to the acceleration of the debt issuance costs triggered by the substantial doubt about the ability of the Company to continue as a going concern. At December 31, 2021, the effective interest consisted of 8.5% variable interest rate and an additional 12.4% due to the acceleration of the debt issuance costs triggered by lack of going concern at September 30, 2021. The unamortized balances of debt discounts, warrant discount and debt issuance cost amounted to $23.4 million and $35.8 million at September 30, 2022 and December 31, 2021, respectively. The Term Loan matures, and all outstanding amounts become due and payable on December 18, 2026. However, certain conditions could result in an earlier maturity, including if the Notes have an aggregate principal amount outstanding of $10.0 million or more on the Trigger Date, in which case the Term Loan will become due on the Trigger Date. The debt is classified as current due to the Trigger Date noted above. Amendments in 2022: On February 11, 2022, we entered into Amendment No. 6 (the “Sixth Amendment”) to the Term Loan Credit Agreement. The Sixth Amendment, among other things, (i) permitted the entry into the ABL Credit Agreement, (ii) permitted certain interest payments due under the Term Loan Credit Agreement to be paid in kind, (iii) permitted certain asset sales and required certain related mandatory prepayments, subject to an applicable prepayment premium, and (iv) amended the financial covenants such that the maximum net leverage ratio of 7.00 to 1.00 would not be tested until the fiscal quarter ending March 31, 2023, and the Company is not permitted to exceed $20.0 million in unfinanced capital expenditures in any calendar year; provided, that such unfinanced capital expenditures limitation will not apply if the Company maintains a net leverage ratio of less than or equal to 4.00 to 1.00 as of the end of the second and fourth fiscal quarter of each calendar year. On May 6, 2022, we entered into Amendment No. 7 (the “Seventh Amendment”) to the Term Loan Credit Agreement. The Seventh Amendment, among other things, (i) modified the Maturity Trigger Date (as defined in the Term Loan Credit Agreement) such that the date on which the maturity of the Term Loan Credit Agreement is triggered as a result of there being an aggregate principal amount of more than $10.0 million outstanding under the Notes is 75 days prior to their maturity date instead of 120 days prior to their maturity date, and (ii) amended the financial covenants such that the maximum net leverage ratio to be tested for the fiscal quarter ending March 31, 2023 be increased from 7.00 to 1.00 to 12.00 to 1.00. In connection with the Quest Integrity Transaction, on November 1, 2022, we, the guarantors party thereto, the lenders party thereto and APSC, as agent for the lenders and secured parties, entered into Amendment No. 8 to the Term Loan Credit Agreement (“Term Loan Amendment No. 8”) which, among other things, (i) modified mandatory prepayment requirements to allow us to retain up to $26.0 million of proceeds in connection with the Quest Integrity Transaction, subject to certain limitations, (ii) modified the Maturity Trigger Date (as defined in the Term Loan Credit Agreement) such that the date on which the maturity of the Term Loan Credit Agreement is triggered as a result of there being an aggregate principal amount of more than $10.0 million outstanding under the Notes is 45 days prior to the maturity date of the Notes rather than 75 days, or June 17, 2023, and (iii) made certain modifications to negative covenants and mandatory prepayment provisions. On November 4, 2022, we entered into Amendment No. 9 to the Term Loan Credit Agreement. Such amendment amended the financial covenant to provide relief from the maximum net leverage ratio covenant thereunder such that it is not tested until the fiscal quarter ending June 30, 2023 and for each fiscal quarter thereafter at 7.00 to 1.00. Subordinated Term Loan On November 9, 2021, we entered into a credit agreement the (“Subordinated Term Loan Credit Agreement”) with Corre Credit Fund, LLC, as agent, and the lenders party thereto providing for an unsecured $50.0 million delayed draw subordinated term loan facility (the “Subordinated Term Loan”). The Subordinated Term Loan matures, and all outstanding amounts become due and payable, on the earlier of December 31, 2026 and the date that is two weeks later than the maturity or full repayment of the Term Loan. The stated interest rate on the Subordinated Term Loan is 12% which is payable in the form of paid-in-kind interest (“PIK Interest”). Effective interest rate at September 30, 2022 and December 31, 2021 was 46.79% and 19.73%, respectively. At September 30, 2022, the effective interest consisted of 12% stated interest and and additional 34.79% due to the acceleration of the debt issuance costs triggered by the substantial doubt about the ability of the Company to continue as a going concern. At December 31, 2021, the effective interest consisted of 12% stated interest and an additional 7.73% due to the acceleration of the debt issuance costs triggered by lack of going concern at September 30, 2021. The unamortized debt issuance cost amounted to $9.0 million and $13.9 million at September 30, 2022 and December 31, 2021, respectively. Amendments in 2022. On February 11, 2022, we entered into Amendment No. 5 to the Subordinated Term Loan Credit Agreement with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent, that, among other things, provided for an additional commitment of $10.0 million in subordinated delayed draw term loans to be available for borrowing by the Company until July 1, 2022 (as amended by Amendment No. 7 as described further below). On May 6, 2022, we entered into Amendment No. 6 to the Subordinated Term Loan Credit Agreement (the “Corre Amendment 6”) with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent. The Corre Amendment 6, among other things, amended the financial covenants, such that the maximum net leverage ratio to be tested for the fiscal quarters ending March 31, 2023 will be increased from 7.00 to 1.00 to 12.00 to 1.00. On June 28, 2022, we entered into Amendment No. 7 to the Subordinated Term Loan Credit Agreement with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent, that, among other things, extended the availability date for the additional commitment of $10.0 million in subordinated delayed draw term loans from July 1, 2022 to October 31, 2022. On October 4, 2022, we entered into Amendment No. 8 to the certain Subordinated Term Loan Credit Agreement,with the lenders from time to time party thereto and Cantor Fitzgerald Securities, as agent pursuant to which, among other things, we increased the total principal amount outstanding under the Subordinated Term Loan Credit Agreement to approximately $112.7 million to give effect to the exchange described below. In addition, Amendment No. 8 extended the availability date for the additional commitment under the Subordinated Term Loan Credit Agreement of $10.0 million in subordinated delayed draw term loans from October 31, 2022 to December 31, 2022. See Convertible Notes below for impact of the amendment to the Notes outstanding. On November 1, 2022, we, as borrower, the guarantors party thereto, the lenders from time to time party thereto and Cantor Fitzgerald Securities, as agent entered into Amendment No. 9 (the “Subordinated Term Loan Amendment No. 9”) to the Subordinated Term Loan Credit Agreement. Subordinated Term Loan Amendment No.9, among other things, (i) modified the mandatory prepayment requirements to allow us to retain up to $26.0 million of proceeds in connection with the Quest Integrity Transaction, subject to certain limitations and (ii) made certain modifications to negative covenants and mandatory prepayment provisions. On November 4, 2022, we entered into Amendment No.10 to the Subordinated Term Loan Credit Agreement. Such amendment amended the financial covenant to provide relief from the maximum net leverage ratio covenant thereunder such that it is not tested until the fiscal quarter ending June 30, 2023 and for each fiscal quarter thereafter at 7.00 to 1.00. Warrants On December 18, 2020, in connection with the execution of the Term Loan Credit Agreement, we issued to APSC warrants to purchase up to 3,582,949 shares of our common stock, which was initially exercisable at the holder’s option at any time, in whole or in part, until June 14, 2028, at an exercise price of $7.75 per share (the “Existing Warrant”). In connection with execution of the Subordinated Term Loan Credit Agreement and Third Amendment, on November 9, 2021, we entered into an Amended and Restated Common Stock Purchase Warrant (the “A&R Warrant”) with APSC Holdco II, L.P. (“APSC Holdco”) pursuant to which the Existing Warrant was amended and restated to provide for the purchase of up to 4,082,949 shares of our common stock (which includes 500,000 of the shares of common stock issuable pursuant to warrants issued to APSC on November 8, 2021, providing for the purchase of an aggregate of 1,417,051 shares of our common stock) and to reduce the exercise price to $1.50 per share. As of September 30, 2022 no warrants have been exercised. Subscription Agreement In connection with the transactions contemplated by the ABL Credit Agreement, Corre agreed to provide the Company with incremental financing (the “Incremental Financing”), totaling approximately $55.0 million, consisting of (i) $35.0 million of Delayed Draw Term Loans under the ABL Credit Facility as discussed above; (ii) $10.0 million from Corre in the form of the February 2022 Delayed Draw Term Loan (as defined in the Subordinated Term Loan Credit Agreement) on a pari passu basis with the existing loans issued pursuant to the Subordinated Term Loan Credit Agreement; and (iii) $10.0 million through an issuance of 11,904,762 shares (the “PIPE Shares”) of our common stock to Corre Opportunities Qualified Master Fund, LP, Corre Horizon Fund, LP and Corre Horizon II Fund, LP (collectively, the “Corre Holders”) at a price of $0.84 per share (the “Equity Issuance”). In connection with the Incremental Financing and Equity Issuance, on February 11, 2022, we entered into a common stock subscription agreement (the “Subscription Agreement”) with the Corre Holders, pursuant to which the Company issued and sold the PIPE Shares to the Corre Holders on February 11, 2022. Pursuant to and subject to the terms and conditions of the Subscription Agreement, our Board of Directors (the “Board”) was required to create a vacancy for one qualified nominee of the Corre Holders to the Board, who shall be designated by the Corre Holders and qualify as an independent director (a “Board Nominee”), and the Board is required to appoint such initial Board Nominee as a Class II director within seven Convertible Notes In December 2020, we retired $136.9 million par value of our Notes, and as of September 30, 2022, the principal amount outstanding was $97.4 million. As of September 30, 2022 and December 31, 2021, the Notes were recorded in our condensed consolidated balance sheets as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Liability component: Principal $ 97,372 $ 93,130 Unamortized issuance costs (1,378) (916) Unamortized discount (869) (4,552) Net carrying amount of the liability component 1 $ 95,125 $ 87,662 Equity component: Carrying amount of the equity component, net of issuance costs 2 $ — $ 7,969 Carrying amount of the equity component, net of issuance costs 3 $ 37,276 $ 37,276 _________________ 1 Included in the “Current portion of long-term debt and finance lease obligations” 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. 3 Relates to the portion of the Notes accounted for under ASC 815-15 (defined below) and is included in the “Additional paid-in capital” line of the condensed consolidated balance sheets. The following table sets forth interest expense information related to the Notes (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Coupon interest 1 $ 1,624 $ 1,164 $ 4,801 $ 3,492 Amortization of debt discount and issuance costs 785 791 2,105 2,326 Total interest expense $ 2,409 $ 1,955 $ 6,906 $ 5,818 Effective interest rate 10.28 % 9.12 % 10.28 % 9.12 % _____________ 1 Coupon interest for three and nine months ended September 30, 2022 includes PIK Interest of $1.1 million and $3.3 million, respectivel y. There was no PIK Interest included in the three and nine months ended September 30, 2021 coupon interest. Amendments in 2022. On January 13, 2022, we entered into a supplemental indenture with Truist Bank, as trustee, (the “Supplemental Indenture”) to the indenture (the “Indenture”) governing the Notes to effect certain amendments (the “Amendments”) to the Indenture and to modify the Notes held by consenting holders (the “Consenting Holders”) of $52.0 million in aggregate principal amount of the Notes (such modified Notes, the “PIK Securities”). The Supplemental Indenture amends the Indenture to, among other things, allow for interest payable on the PIK Securities on February 1, 2022 to be PIK Interest and on subsequent interest payment dates to be payable, at the Company’s option, at a rate of 5.00% per annum entirely in cash or at a rate of 8.00% per annum in PIK Interest. On October 4, 2022, we entered into an exchange agreement (the “Exchange Agreement”) by and among us and certain holders (collectively, the “Exchanging Holders”) of the Notes. The Exchanging Holders held Notes that paid interest, at our option, at a rate of 5.00% per annum entirely in cash or at a rate of 8.00% per annum in PIK Interest. Pursuant to the Exchange Agreement, we agreed to exchange approximately $57.0 million of aggregate principal amount, plus accrued and unpaid PIK Interest, of Notes beneficially owned by the Exchanging Holders for an equivalent increased principal amount of term loans (the “New Term Loans”) under the Subordinated Term Loan Credit Agreement. We entered into the Corre/AP Term Sheet (as defined in the Subordinated Term Loan Credit Agreement) on November 9, 2021 pursuant to which each of the Exchanging Holders had the right to exchange the Notes into New Term Loans and each Exchanging Holder exercised such right. Following the closing of the Exchange Agreement and Amendment No. 8, we have approximately $41.2 million in aggregate principal amount of Notes outstanding, which pay interest at a rate of 5.00% per annum entirely in cash. ASU 2020-06 Adoption. In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity . The ASU simplifies the accounting for convertible instruments by removing certain separation models in ASC 470-20, Debt—Debt with Conversion and Other Options, for convertible instruments. The ASU updates the guidance on certain embedded conversion features that are not required to be accounted for as derivatives under Topic 815, Derivatives and Hedging , or that do not result in substantial premiums accounted for as paid-in capital, such that those features are no longer required to be separated from the host contract. The convertible debt instruments will be accounted for as a single liability measured at amortized cost. This will also result in the interest expense recognized for convertible debt instruments to be typically closer to the coupon interest rate when applying the guidance in Topic 835, Interest. Further, the ASU made amendments to the EPS guidance in Topic 260 for convertible debt instruments, the most significant impact of which is requiring the use of the if-converted method for diluted EPS calculation, and no longer allowing the net share settlement method. The ASU also made revisions to Topic 815-40, which provides guidance on how an entity must determine whether a contract qualifies for a scope exception from derivative accounting. The amendments to Topic 815-40 change the scope of contracts that are recognized as assets or liabilities. The ASU is effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted for periods beginning after December 15, 2020. Adoption of the ASU can either be on a modified retrospective or full retrospective basis. On January 1, 2022, we adopted the ASU using the modified retrospective method. We recognized a cumulative effect of initially applying the ASU as an adjustment to the January 1, 2022 opening balance of accumulated deficit. The prior period consolidated financial statements have not been retrospectively adjusted and continue to be reported under the accounting standards in effect for those periods. Accordingly, the cumulative effect of the changes made on our January 1, 2022 condensed consolidated balance sheet for the adoption of the ASU was as follows (in thousands): Balances at December 31, 2021 Adjustments from Adoption of ASU 2020-06 Balances at January 1, 2022 Liabilities Long-term debt and finance lease obligations $ 405,191 $ 1,827 $ 407,018 Equity Additional paid-in capital $ 444,824 $ (5,651) $ 439,173 Accumulated deficit $ (375,584) $ 3,824 $ (371,760) The impact of adoption on our consolidated statements of operations for the nine months ended September 30, 2022 was primarily to decreased net interest expense by $0.8 million. This had the effect of decreasing our basic and diluted net loss per share of common stock attributable to common stockholders for the nine months ended September 30, 2022 by $0.01. The change in methodology by requiring the use of the if-converted method to determine the denominator used in the calculation of diluted net income per share of common stock attributable to common stockholders did not have an impact on the diluted EPS as the shares of common stock issuable upon conversion were not included in the denominator because of the antidilutive effect. 1970 Group Substitute Insurance Reimbursement Facility On September 29, 2022, we entered into the Substitute Insurance Reimbursement Facility Agreement with 1970 Group. Under this agreement, 1970 Group is able to extend credit to us in the form of a substitute reimbursement facility (the “Substitute Reimbursement Facility”) to provide up to approximately $21.4 million of letters of credit on our behalf in support of our workers’ compensation, commercial automotive and general liability insurance carriers for workers’ compensation, commercial automotive and/or general liability policies (the “Insurance Policies”). Under the Substitute Insurance Reimbursement Facility Agreement, 1970 Group arranged for the issuance of letters of credit from financial institutions approved by the National Association of Insurance Commissioners. Such letters of credit arranged by the 1970 Group permit the return of certain existing letters of credit for our account that are outstanding for the purpose of supporting the Insurance Policies and that are required to be collateralized, thereby providing us increased liquidity in the amount of approximately $21.3 million. Under the Substitute Insurance Reimbursement Facility Agreement, we will be required to reimburse the 1970 Group for any draws made under the letters of credit within five business days of notice of any such draw. The Substitute Insurance Reimbursement Facility Agreement will terminate upon the earlier of (i) the expiration or termination of our Insurance Policies or (ii) September 29, 2023. This arrangement replaces our existing letters of credit. It allowed us to release $16.3 million out of a total of $25.7 million of restricted cash previously held as collateral for the replaced letters of credit as well as reduced the outstanding letters of credit under the ABL Credit Facility by $5.0 million thereby improving our liquidity. According to the provisions of ASC 470 – Debt, the arrangement is a Substitute Reimbursement Facility limited to the amounts drawn under the letters of credit. Therefore, until we use or draw on the Substitute Reimbursement Facility, the letter of credit is treated as an off-balance sheet credit arrangement. The fees in the amount of $2.9 million paid by us are deferred and amortized over the term of the arrangement. As of September 30, 2022, unamortized balance in the amount of $2.9 million is included in other current assets. Deferred Financing Costs, Debt and Warrant Discounts and Debt Issuance Cost As referenced above, all debt with original maturities greater than one year are classified as current as of September 30, 2022 due to the Trigger Date provisions. As of September 30, 2022 and December 31, 2021, capitalized deferred financing costs, inclusive of debt issuance costs and discounts, net of accumulated amortization, related to Team’s outstanding debt were $39.4 million and $58.0 million, respectively. Due to the Trigger Date provisions, the amortization period for deferred financing costs, debt and warrant discounts and debt issuance costs was updated to reflect the potential accelerated maturity dates. This resulted in additional amortization charges of $10.6 million and $15.2 million during the three and nine months ended September 30, 2022, respectively. Refer to Note 1 - Summary of Significant Accounting Policies and Practices for additional liquidity and going concern discussion. Liquidity At September 30, 2022, we had $30.7 million of unrestricted cash and cash equivalents and $25.7 million of restricted cash held as collateral for letters of credit and commercial card programs. International cash balances at September 30, 2022 were $12.9 million , and approximately $1.6 million of cash is located in countries where currency restrictions exist. We had approximately $11.9 million in additional borrowing capacity, consisting of $1.9 million of availability under the ABL Credit Facility and $10.0 million available under the Subordinated Term Loan. Internationally, we have letters of credit outstanding in the amount of $0.3 million. Additionally, we have $1.6 million in Surety bonds outstanding and an additional $0.9 million in miscellaneous cash deposits securing leases or other required obligations. Our cash and cash equivalents at December 31, 2021 totaled $55.2 million, of which $4.1 million was restricted for interest due on the Atlantic Park Term Loan. Additionally, $14.2 million of the $55.2 million of cash and cash equivalents was in foreign accounts, primarily in Europe, Canada and Australia including $2.4 million of cash located in countries where currency restrictions exist. Refer to Note 1 - Summary of Significant Accounting Policies and Practices for additional liquidity and going concern discussion. On November 1, 2022, the Company completed the sale of its Quest Integrity business to Baker Hughes for cash proceeds of approximately $279 million, reflecting certain estimated post-closing adjustments. The net proceeds to the Company (after payment of transaction related expenses and certain other fees) were approximately $270 million. The Company used approximately $238 million of the proceeds to pay down term debt and to pay certain fees associated with that repayment and related accrued interest, with the remainder reserved for general corporate purposes. As of November 4, 2022, we had consolidated cash and cash equivalents of $76.0 million, of which $6.8 million was restricted mainly as collateral for outstanding letters of credit and approximately $13.7 million of undrawn availability under its various credit facilities, resulting in total liquidity of $82.9 million. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
LEASES | LEASES We adopted ASC 842, Leases, effective January 1, 2019 and elected the modified retrospective transition method. 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 twelve 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 14 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 September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Operating lease costs $ 6,035 $ 6,784 $ 19,056 $ 21,044 Variable lease costs 1,057 1,503 3,958 4,106 Finance lease costs: Amortization of right-of-use assets 237 155 498 467 Interest on lease liabilities 143 84 269 252 Total lease cost 7,472 8,526 23,781 25,869 Lease cost - discontinued operations $ 126 $ (472) $ (785) $ (1,169) Lease cost - continuing operations $ 7,598 $ 8,054 $ 22,996 $ 24,700 Other information related to leases are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Supplemental cash flow information: (unaudited) (unaudited) (unaudited) (unaudited) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,934 $ 6,226 $ 15,434 $ 17,569 Operating cash flows from finance leases 89 81 204 252 Financing cash flows from finance leases 295 119 615 356 Right-of-use assets obtained in exchange for lease obligations Operating leases 1,343 721 2,697 9,304 Finance leases 752 611 852 1,017 Amounts recognized in the condensed consolidated balance sheets are as follows (in thousands): September 30, 2022 December 31, 2021 Operating Leases: (unaudited) Operating lease right-of-use assets, continuing operations $ 48,189 $ 58,495 Operating lease right-of-use assets, discontinued operations 1,872 2,205 Current portion of operating lease obligations, continuing operations 13,328 15,412 Current portion of operating lease obligations, discontinued operations 812 764 Operating lease obligations (non-current), continuing operations 39,144 47,617 Operating lease obligations (non-current), discontinued operations 1,000 1,604 Finance Leases: Finance lease right-of-use assets, continuing operations $ 4,909 $ 5,114 Finance lease right-of-use assets, discontinued operations 6 9 Current portion of finance lease obligations, continuing operations 898 667 Current portion of finance lease obligations, discontinued operations 2 2 Long-term finance lease obligations, continuing operations 4,810 4,973 Long-term finance lease obligations, discontinued operations 4 7 Weighted average remaining lease term: Operating leases 5.8 years 6.0 years Finance leases 9.1 years 10.0 years Weighted average discount rate: Operating leases 7.1 % 6.8 % Finance leases 7.0 % 6.4 % As of September 30, 2022, we have no material additional operating and finance leases that have not yet commenced. As of September 30, 2022, future minimum lease payments under non-cancellable leases (including short-term leases) are as follows (in thousands): Operating Leases Finance Leases (unaudited) (unaudited) 2022 (Remainder of the year) $ 5,774 $ 424 2023 15,146 1,197 2024 12,058 954 2025 8,711 667 2026 6,654 608 Thereafter 17,553 3,925 Total future minimum lease payments 65,896 7,775 Less: Interest 13,424 2,067 Present value of lease liabilities $ 52,472 $ 5,708 |
LEASES | LEASES We adopted ASC 842, Leases, effective January 1, 2019 and elected the modified retrospective transition method. 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 twelve 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 14 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 September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Operating lease costs $ 6,035 $ 6,784 $ 19,056 $ 21,044 Variable lease costs 1,057 1,503 3,958 4,106 Finance lease costs: Amortization of right-of-use assets 237 155 498 467 Interest on lease liabilities 143 84 269 252 Total lease cost 7,472 8,526 23,781 25,869 Lease cost - discontinued operations $ 126 $ (472) $ (785) $ (1,169) Lease cost - continuing operations $ 7,598 $ 8,054 $ 22,996 $ 24,700 Other information related to leases are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Supplemental cash flow information: (unaudited) (unaudited) (unaudited) (unaudited) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,934 $ 6,226 $ 15,434 $ 17,569 Operating cash flows from finance leases 89 81 204 252 Financing cash flows from finance leases 295 119 615 356 Right-of-use assets obtained in exchange for lease obligations Operating leases 1,343 721 2,697 9,304 Finance leases 752 611 852 1,017 Amounts recognized in the condensed consolidated balance sheets are as follows (in thousands): September 30, 2022 December 31, 2021 Operating Leases: (unaudited) Operating lease right-of-use assets, continuing operations $ 48,189 $ 58,495 Operating lease right-of-use assets, discontinued operations 1,872 2,205 Current portion of operating lease obligations, continuing operations 13,328 15,412 Current portion of operating lease obligations, discontinued operations 812 764 Operating lease obligations (non-current), continuing operations 39,144 47,617 Operating lease obligations (non-current), discontinued operations 1,000 1,604 Finance Leases: Finance lease right-of-use assets, continuing operations $ 4,909 $ 5,114 Finance lease right-of-use assets, discontinued operations 6 9 Current portion of finance lease obligations, continuing operations 898 667 Current portion of finance lease obligations, discontinued operations 2 2 Long-term finance lease obligations, continuing operations 4,810 4,973 Long-term finance lease obligations, discontinued operations 4 7 Weighted average remaining lease term: Operating leases 5.8 years 6.0 years Finance leases 9.1 years 10.0 years Weighted average discount rate: Operating leases 7.1 % 6.8 % Finance leases 7.0 % 6.4 % As of September 30, 2022, we have no material additional operating and finance leases that have not yet commenced. As of September 30, 2022, future minimum lease payments under non-cancellable leases (including short-term leases) are as follows (in thousands): Operating Leases Finance Leases (unaudited) (unaudited) 2022 (Remainder of the year) $ 5,774 $ 424 2023 15,146 1,197 2024 12,058 954 2025 8,711 667 2026 6,654 608 Thereafter 17,553 3,925 Total future minimum lease payments 65,896 7,775 Less: Interest 13,424 2,067 Present value of lease liabilities $ 52,472 $ 5,708 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATIONWe have adopted stock incentive plans and other arrangements pursuant to which 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, 2022, there were approximately 1.2 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 the Board at the time of grant and may vary. In May 2021, our shareholders approved the amendment and restatement of the 2018 Team, Inc. Equity Incentive Plan (the “2018 Plan”). The 2018 Plan replaced the 2016 Team, Inc. Equity Incentive Plan. The amendment and restatement to the 2018 Plan increased the shares available for issuance by 3.0 million shares of our common stock. 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 $0.6 million and $1.1 million for the three months ended September 30, 2022 and 2021, respectively. Compensation expense related to share-based compensation totaled $0.6 million and $5.6 million for the nine months ended September 30, 2022 and 2021, respectively. Share-based compensation expense reflects an estimate of expected forfeitures. At September 30, 2022, $2.2 million of unrecognized compensation expense related to share-based compensation is expected to be recognized over a remaining weighted-average period of 1.3 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 three Transactions involving our stock units and director stock grants for the nine months ended September 30, 2022 are summarized below: Nine Months Ended (unaudited) No. of Stock Weighted (in thousands) Stock and stock units, beginning of year 804 $ 7.27 Changes during the period: Granted 525 $ 1.30 Vested and settled (135) $ 7.16 Forfeited and cancelled (101) $ 6.95 Stock and stock units, end of period 1,093 $ 4.44 Performance stock units. 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, we communicate “target awards” to the executive officers during the first year 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 2019 (the “2019 Awards”), in 2020 (the “2020 Awards”) and in 2021 (the “2021 Awards”) are subject to a two-year performance period and a concurrent two-year service period. There were no LTPSU awards granted during the three and nine months ended September 30, 2022. For the LTPSU awards, the performance goal is 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 2019 Awards vested as of March 15, 2021 at the RTSR performance target level of 25% and the results of operations performance metric at 0% of the target level. 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 a credit of $1.2 million and expense of $1.9 million for the nine months ended September 30, 2022 and 2021, respectively. Transactions involving our performance awards during the nine months ended September 30, 2022 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 No. of Stock Units 1 Weighted (in thousands) (in thousands) Performance stock units, beginning of period 684 $ 6.45 219 $ 9.91 Changes during the period: Granted — — — — Vested and settled — — — — Cancelled (653) $ 6.04 (188) $ 9.61 Performance stock units, end of period 31 $ 14.96 31 $ 11.69 _________________ 1 Performance units with variable payouts are shown at target level of performance. Stock Options. 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. There was no compensation expense related to stock options for the periods ended September 30, 2022 or December 31, 2021. 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. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 9 Months Ended |
Sep. 30, 2022 | |
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”). Net periodic pension credit includes the following components (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Interest cost $ 358 $ 322 1,171 $ 970 Expected return on plan assets (533) (504) (1,744) (1,515) Amortization of prior service cost 7 9 23 26 Net periodic pension credit $ (168) $ (173) $ (550) $ (519) 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: 2.1% overall, 4.6% for equities and 1.4% for debt securities. We |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 9 Months Ended |
Sep. 30, 2022 | |
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 Foreign Defined Benefit Pension Plans Tax Total Foreign Foreign Defined Benefit Pension Plans Tax Total Balance, beginning of period $ (23,287) $ — $ (3,277) $ (169) $ (26,732) $ (23,045) $ 2,988 $ (8,021) $ 400 $ (27,678) Other comprehensive loss (12,152) — — — (12,152) (2,210) — — 536 (1,674) Balance, end of period $ (35,439) $ — $ (3,277) $ (169) $ (38,884) $ (25,255) $ 2,988 $ (8,021) $ 936 $ (29,352) 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 Tax Net Gross Tax Net Foreign currency translation adjustments $ (12,152) — $ (12,152) $ (2,210) $ 536 $ (1,674) Total $ (12,152) $ — $ (12,152) $ (2,210) $ 536 $ (1,674) |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, which will only be resolved when one or more future events occur or fail to occur. Team’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against us or unasserted claims that may result in such proceedings, Team’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in our financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed. We accrue for contingencies where the occurrence of a material loss is probable and can be reasonably estimated, based on our best estimate of the expected liability. We may increase or decrease our legal accruals in the future, on a matter-by-matter basis, to account for developments in such matter. Because such matters are inherently unpredictable and unfavorable developments or outcomes can occur, assessing contingencies is highly subjective and requires judgments about future events. Notwithstanding the uncertainty as to the outcome and while our insurance coverage might not be available or adequate to cover these claims, based upon the information currently available, we do not believe that any uninsured losses that might arise from these lawsuits and proceedings will have a materially adverse effect on our consolidated financial statements. California Wage and Hour Litigation - On June 24, 2019 and August 26, 2020, two putative class action complaints were filed against Team Industrial Services, Inc. in the Superior Court for the County of Los Angeles, California. The plaintiff in the first filed action is Michael Thai (the “Thai action”). The plaintiff in the second filed action is Alex Esqueda (the “Esqueda action”). All of the claims pleaded in the Esqueda action were also pleaded in the Thai action. Each of the plaintiffs assert claims for alleged wage and hour violations under the California Labor Code (for alleged unpaid wages, failure to provide meal and rest breaks, and derivative related claims). The Thai action also asserts a putative class claim for violation of the Fair Credit Reporting Act. Both cases were stayed shortly after filing to allow the parties to mediate the claims. On February 23, 2021, the Los Angeles Superior Court designated the Thai and Esqueda actions as related cases. While the parties mediated on March 18, 2021, the cases did not settle. On April 16, 2021, Team Industrial Services, Inc. moved both the Thai and Esqueda actions to the United States District Court for the Central District of California. Plaintiff’s motion for remand was denied, and these matters remain in federal court. In November 2021, the parties agreed in principle to settle all claims in this litigation and all parties entered into a formal settlement agreement in March 2022. As part of the settlement agreement, the parties have agreed to remand the case to the Los Angeles Superior Court for approval of the settlement. All class action settlements of this nature are subject to approval of the court, which can take several months after the final settlement agreement is executed by the parties. The parties anticipate court approval of the settlement agreement in the first quarter of 2023. Notice of Potential Environmental Violation - On April 20, 2021, Team Industrial Services, Inc. received Notices of Potential Violation from the U.S. Environmental Protection Agency (“EPA”) alleging noncompliance with various waste determination, reporting, training, and planning obligations under the Resource Conservation and Recovery Act at seven of our facilities located in Texas and Louisiana. The allegations largely relate to spent film developing solutions generated through our mobile radiographic inspection services and the claims relate to the characterization and quantities of those wastes and related notices, reporting, training, and planning. On February 9, 2022, TEAM and the EPA agreed to settle all the claims related to this matter and the formal settlement agreement was finalized in April 2022 with our agreement to pay penalties totaling $0.2 million. Kelli Most Litigation - On November 13, 2018, Kelli Most filed a lawsuit against Team Industrial Services, Inc., individually and as a personal representative of the estate of Jesse Henson, in the 268th District Court of Fort Bend County, Texas (the “Most litigation”). The complaint asserted claims against Team for negligence resulting in the wrongful death of Jesse Henson. A jury trial commenced on this matter on May 4, 2021. On June 1, 2021, the jury rendered a verdict against Team for $222.0 million in compensatory damages. We believe that the jury verdict is not supported by the facts of the case or applicable law, is the result of significant trial error, and there are strong grounds for appeal. We intend to vigorously challenge the judgment through the appeal processes. On January 25, 2022, the trial court signed a final judgment in favor of the plaintiff and against Team Industrial Services, Inc. Post-judgment motions challenging the judgment were filed on February 24, 2022 and were denied by the court on April 22, 2022. A notice of appeal was filed on April 25, 2022, and this case is currently pending in the Court of Appeals for the First District of Texas, in Houston. We believe the likelihood that the amount of the judgment will be affirmed is not probable. We have taken into consideration the events that have occurred after the reporting period and before the financial statements were issued. We currently estimate a range of possible outcomes between $13.0 million and approximately $51.0 million, and we have accrued a liability as of September 30, 2022, which is the amount we believe is the most likely estimate for a probable loss on this matter. We have also recorded a related receivable from our third-party insurance providers in other current assets with the corresponding liability of the same amount in other accrued liabilities. Such amounts are treated as non-cash operating activities. The Most litigation is covered by our general liability and excess insurance policies which are occurrence based and subject to an aggregate $3.0 million self-insured retention and deductible. All retentions and deductibles have been met, accordingly, we believe pending the final settlement, all further claims will be fully funded by our insurance policies. We will continue to evaluate the possible outcomes of this case in light of future developments and their potential impact on factors relevant to our assessment of any possible loss. Simon, Vige, and Roberts Matter – On February 19, 2019, a personal injury claim was filed by the plaintiffs against several counterparties including Team Industrial Services Inc., in the 295th District Court of Harris County, Texas. The plaintiffs filed the action seeking monetary damages for personal injury, and emotional and mental distress. This matter was settled in July 2021. This claim is covered by our general liability and excess insurance policies which are occurrence based and subject to an aggregate $3.0 million self-insured retention and deductible. Accordingly, for all matters discussed above, we have accrued in the aggregate approximately $44.0 million as of September 30, 2022, of which approximately $5.0 million is not covered by our various insurance policies. In addition to legal matters discussed above, we are subject to various lawsuits, claims and proceedings encountered in the normal conduct of business (“Other Proceedings”). Management believes that based on its current knowledge and after |
SEGMENT AND GEOGRAPHIC DISCLOSU
SEGMENT AND GEOGRAPHIC DISCLOSURES | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC DISCLOSURES | SEGMENT AND GEOGRAPHIC DISCLOSURES On November 1, 2022, we completed the Quest Integrity Transaction. As of September 30, 2022, the criteria for reporting Quest Integrity as a discontinued operation were met and, as such, all periods presented in this Form 10-Q have been recast to present Quest Integrity as a discontinued operation. Unless otherwise specified, the financial information and discussion in this Form 10-Q are based on our continuing operations (IHT and MS segments) and exclude any results of our discontinued operations (Quest Integrity). Refer to Note 2 - Discontinued Operations for additional details. ASC 280, Segment Reporting , requires us to disclose certain information about our operating segments. 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 two segments: IHT and MS. Historically Quest Integrity was a separate segment, but Quest Integrity is now part of discontinued operations, as referenced above. Segment data for our two operating segments are as follows (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Revenues: IHT $ 110,312 $ 101,476 $ 320,033 $ 310,077 MS 108,027 96,403 308,884 280,966 Continuing operations total $ 218,339 $ 197,879 $ 628,917 $ 591,043 Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Operating income (loss): IHT $ 7,390 $ 3,065 $ 13,038 $ 10,824 MS 7,655 (53,242) 15,152 (50,799) Corporate and shared support services (16,774) (22,051) (63,119) (67,997) Continuing operations total $ (1,729) $ (72,228) $ (34,929) $ (107,972) Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Capital expenditures 1 : IHT $ 2,557 $ 1,454 $ 10,654 $ 6,625 MS 1,427 741 3,861 3,260 Corporate and shared support services 274 293 331 714 Continuing operations total $ 4,258 $ 2,488 $ 14,846 $ 10,599 _____________ 1 Excludes finance leases. Totals may vary from amounts presented in the consolidated statements of cash flows due to the timing of cash payments. Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Depreciation and amortization: IHT $ 3,022 $ 3,148 $ 9,372 $ 9,888 MS 4,704 4,950 14,222 15,432 Corporate and shared support services 1,261 1,418 3,855 4,080 Continuing operations total $ 8,987 $ 9,516 $ 27,449 $ 29,400 Separate measures of our 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, 2022 and 2021 is as follows (unaudited, in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Total Revenues 1 United States $ 173,890 $ 143,636 $ 497,236 $ 447,932 Canada 28,193 30,465 84,704 81,110 Europe 24,869 27,122 75,546 82,098 Other foreign countries 20,828 16,187 60,135 39,761 Total $ 247,780 $ 217,410 $ 717,621 $ 650,901 Discontinued operations revenue (29,441) (19,531) (88,704) (59,858) Total continuing operations revenue $ 218,339 $ 197,879 $ 628,917 $ 591,043 ______________ 1 Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
SEVERANCE AND OTHER CHARGES
SEVERANCE AND OTHER CHARGES | 9 Months Ended |
Sep. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
SEVERANCE AND OTHER CHARGES | SEVERANCE AND OTHER CHARGES For the nine months ended September 30, 2022, we incurred severance charges of $3.0 million, which represents costs incurred in 2022 as a result of ongoing cost reduction efforts. A rollforward of our accrued severance liability associated with our ongoing cost reduction efforts is presented below (in thousands): Nine Months Ended (unaudited) Balance, beginning of period $ 712 Charges 3,028 Payments (1,952) Balance, end of period $ 1,788 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Alvarez & Marsal provided certain consulting services to the Company in connection with our former Interim Chief Financial Officer position and other corporate support costs. Effective June 12, 2022 the Interim Chief Financial Officer position ended as the Company named a permanent Chief Financial Officer. The Company paid $8.0 million in consulting fees to Alvarez & Marsal for the year ended December 31, 2021, and $6.4 million for the year to date period ended September 30, 2022. In connection with the Company’s debt transactions, the Company engaged in transactions with Corre and Atlantic Park to provide funding as described in Note 12 - Debt . |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On October 4, 2022, we entered into the Exchange Agreement to exchange approximately $57.0 million of aggregate principal amount, plus accrued and unpaid PIK Interest, of Notes owned by the Exchanging Holders for an equivalent increased principal amount of term loans. The principal balance of the convertible debt after the exchange is $41.2 million. Refer to Note 12 - Deb t for additional information. On November 1, 2022, we entered into ABL Credit Agreement Amendment No.2, Term Loan Amendment No.8 and Subordinated Term Loan Amendment No. 9. Refer to Note 12 - Deb t for additional information. On November 1, 2022, we entered into the Board Rights Agreement (the “Board Rights Agreement”) with APSC (in such capacity, the “Investor Representative”), pursuant to which the Investor Representative, acting on behalf of itself and its affiliates that beneficially own our common stock (such affiliates, together with the Investor Representative, the “Investors”), may, subject to common stock ownership thresholds and other terms provided in the Board Rights Agreement, designate an individual to serve as a non-voting observer at all meetings of the Board and nominate an individual designated by the Investor Representative to serve on the Board (the “Investor Director”). The right to nominate the Investor Director is subject to certain qualification requirements and the discretion of our Corporate Governance and Nominating Committee under limited circumstances. The Investor’s rights under the Board Rights Agreement are a continuation of existing rights under the Term Loan Credit Agreement and that certain commitment letter (the “Commitment Letter”), dated as of November 9, 2021, by and among us, Corre Partners Management, LLC and APSC in the event obligations under the Term Loan Credit Agreement cease to be outstanding. The Investors are not permitted to designate, in the aggregate, more than one non-voting board observer and more than one Investor Director under the Board Rights Agreement, the Term Loan Credit Agreement and the Commitment Letter, provided that the Board Rights Agreement does not otherwise limit or impair any rights under the Commitment Letter and the Term Loan Credit Agreement. In the event of the resignation, death or removal (for cause or otherwise) of the Investor Director from the Board, the Investor Representative, acting on behalf of the Investors, will have the right, but not the obligation, to designate a successor Investor Director to the Board to fill the resulting vacancy on the Board (and any applicable committee thereof), subject to certain qualification requirements specified in the Board Rights Agreement. On November 1, 2022, we completed the sale of all of the issued and outstanding equity interests of our wholly-owned subsidiary, TQ Acquisition, to Baker Hughes for an aggregate purchase price of approximately $279 million, reflecting certain estimated post-closing adjustments. Refer to Note 1 - Summary of Significant Accounting Policies for additional information. On November 2, 2022, we received notice by the NYSE that we were no longer in compliance with the continued listing standard set forth in Section 802.01C of the NYSE Listed Company Manual because the average closing price of our common stock was less than $1.00 per share over a consecutive 30 trading-day period. The notice has no immediate impact on the listing of our common stock, which will continue to trade on the NYSE during the applicable cure period, and does not result in a default under our material debt or other agreements. Refer to the section entitled “We may not be able to meet the NYSE’s continued listing requirements and rules, and the NYSE may delist our common stock, which could negatively affect our company, the price of our common stock and our shareholders’ ability to sell our common stock and may lead to potential events of default on existing debt instruments” in Part II, Item 1A of this Quarterly Report on Form 10-Q for additional information. On November 4, 2022, we entered into Amendment No. 9 to the Term Loan Credit Agreement and Amendment No. 10 to the Subordinated Term Loan Credit Agreement. See Note 12 - Debt for additional details. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis for presentation | Basis for presentation. These condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) and the rules and regulations of the Securities and Exchange Commission. In the opinion of management, these unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of results for such periods. 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. These financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the Securities and Exchange Commission. |
Consolidation | Consolidation. The condensed consolidated financial statements include the accounts of our subsidiaries where we have control over operating and financial policies. All material intercompany accounts and transactions have been eliminated in consolidation. |
Related Party Transactions | Related Party Transactions. A related party transaction is any transaction, arrangement or relationship or series of similar transactions, arrangements or relationships (including the incurrence or issuance of any indebtedness or the guarantee of indebtedness) in which (1) the Company or any of its subsidiaries is a participant, and (2) any Related Party (as defined below) has or will have a direct or indirect material interest. |
Use of estimates | Use of estimates. Our accounting policies conform to GAAP. The preparation of condensed 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 condensed 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) selecting assumptions used in the measurement of costs and liabilities associated with defined benefit pension plans, (8) assessments of fair value and (9) managing our foreign currency risk in foreign operations. Our most significant accounting policies are described below. |
Fair value of financial instruments | Fair value of financial instruments . As defined in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820 Fair Value Measurements and Disclosur e (“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 inputs that are unobservable and of a highly subjective measure. |
Cash and cash equivalents | Cash and cash equivalents . |
Inventory | Inventory. Except for certain inventories that are valued based on weighted-average cost, we use the first-in, first-out method to value our inventory. Inventory includes material, labor, and certain fixed overhead costs. Inventory is stated at the lower of cost and net realizable value. Inventory quantities on hand are reviewed periodically and carrying cost is reduced to net realizable value for inventories for which their cost exceeds their utility. The cost of inventories consumed or products sold are included in operating expenses. |
Property, plant and equipment | Property, plant and equipment. Property, plant and equipment are stated at cost less accumulated depreciation and amortization. Leasehold improvements are amortized over the shorter of their respective useful life or the lease term. Depreciation and amortization of assets are computed by the straight-line method over the following estimated useful lives of the assets: Classification Useful Life Buildings 20-40 years Enterprise Resource Planning (“ERP”) System 15 years Leasehold improvements 2-15 years Machinery and equipment 2-12 years Furniture and fixtures 2-10 years Computers and computer software 2-5 years Automobiles 2-5 years |
Goodwill and intangible assets | Goodwill and intangible assets. Goodwill and intangible assets acquired in a business combination determined to have an indefinite useful life are not amortized, but are instead tested for impairment, and assessed for potential triggering events, at least annually in accordance with the provisions of the ASC 350 Intangibles—Goodwill and Other (“ASC 350”). Intangible assets with finite lives are amortized over their respective estimated useful lives to their estimated residual values and reviewed for impairment in accordance with ASC 360- 10 Impairment or Disposal of Long-Lived Assets (“ASC 360”). We assess goodwill for impairment at the reporting unit level, which we have determined to be the same as our operating segments. As of September 30, 2022 and December 31, 2021, there was no goodwill on the Company’s balance sheets related to continuing operations. The only segment with goodwill was Quest Integrity, which is included in discontinued operations. If the carrying value of a reporting unit exceeds its fair value, we measure any 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 test our goodwill for impairment annually on December 1 of each year and whenever we become aware of an event or a change in circumstances that would indicate the carrying value may be impaired. There was no goodwill impairment recorded for the nine months ended September 30, 2022. Goodwill impairment of $55.8 million was recorded for the three months and nine months ended September 30, 2021 in our continuing operations related to our MS operating segment. |
Income taxes | Income taxes. We follow the guidance of ASC 740 Income Taxes (“ASC 740”), which requires that we use the asset and liability method of accounting for deferred income taxes and provide deferred income taxes for all significant temporary differences. As part of the process of preparing our condensed consolidated financial statements, we are required to estimate our income taxes in each of the jurisdictions in which we operate. This process involves estimating our actual current tax payable or receivable and related tax expense or benefit together with assessing temporary differences resulting from differing treatment of certain items, such as depreciation, for tax and accounting purposes. These differences can result in deferred tax assets and liabilities, which are included within our consolidated balance sheets. In accordance with ASC 740, we are required to assess the likelihood that our deferred tax assets will be realized and, to the extent we believe it is more likely than not (a likelihood of more than 50%) that some portion or all of the deferred tax assets will not be realized, we must establish a valuation allowance. We consider all available evidence to determine whether, based on the weight of the evidence, a valuation allowance is needed. Evidence used includes the reversal of existing taxable temporary differences, taxable income in prior carryback years if carryback is permitted by tax law, information about our current financial position and our results of operations for the current and preceding years, as well as all currently available information about future years, including our anticipated future performance and tax planning strategies. |
Workers’ compensation, auto, medical and general liability accruals | Workers’ compensation, auto, medical and general liability accruals. In accordance with ASC 450 Contingencies (“ASC 450”), we record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We review our loss contingencies on an ongoing basis to ensure that we have appropriate reserves recorded on our balance sheet. These reserves are based on historical experience with claims incurred but not received, estimates and judgments made by management, applicable insurance coverage for litigation matters, and are adjusted as circumstances warrant. For workers’ compensation, our self-insured retention is $1.0 million and our automobile liability deductible is $2.0 million per occurrence. For general liability claims, we have a deductible of $1.0 million and a self-insured retention of $5.0 million per occurrence. For medical claims, our self-insured retention is $0.4 million per individual claimant determined on an annual basis. For environmental liability claims, our self-insured retention is $1.0 million per occurrence. We maintain insurance for claims that exceed such self-retention limits. The insurance is subject to terms, conditions, limitations, and exclusions that may not fully compensate us for all losses. Our estimates and judgments could change based on new information, changes in laws or regulations, changes in management’s plans or intentions, or the outcome of legal proceedings, settlements, or other factors. If different estimates and judgments were applied with respect to these matters, it is likely that reserves would be recorded for different amounts. |
Allowance for credit losses | Allowance for credit losses. 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 credit losses 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 income (loss) from continuing operations, income (loss) from discontinued operations or net income (loss) by the weighted-average number of shares of common stock outstanding during the year. Diluted earnings (loss) per share is computed by dividing income (loss) from continuing operations, income (loss) from discontinued operations or net income (loss) 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 Notes under the if converted method. Our current intent is to settle the principal amount of our Notes in cash upon maturity. If the conversion value exceeds the principal amount, we may elect to deliver shares of our common stock with respect to the remainder of our 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 and the numerator is adjusted for any recorded gain or loss, net of tax, on the embedded derivative associated with the conversion feature. For the three and nine months ended September 30, 2022 and 2021, 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 loss from continuing operations in those periods. Also, for the three and nine months ended September 30, 2022 and 2021, potential shares issuable upon the conversion of the Notes were excluded from the calculation of diluted earnings (loss) per share since the conversion price exceeded the average price of our common stock during the applicable periods. For information regarding our Notes and our share-based compensation awards, refer to Note 12 - Debt and Note 14 - Share-Based Compensation , respectively. |
Foreign currency | Foreign currency . For subsidiaries whose functional currency is not the U.S. Dollar, assets and liabilities are translated at period ending rates of exchange and revenues and expenses are translated at period average exchange rates. Translation adjustments for the asset and liability accounts are included as a separate component of accumulated other comprehensive loss in stockholders’ equity. Foreign currency transaction gains and losses are included in our statements of operations. We have historically executed a foreign currency hedging program to mitigate the foreign currency risk in countries where we have significant assets and liabilities denominated in currencies other than the functional currency. Our hedging program ended in October 2021. The impact from the foreign currency swap contracts was not material for the three and nine months ended September 30, 2021. |
Defined benefit pension plans | Defined benefit pension plans. Pension benefit costs and liabilities are dependent on assumptions used in calculating such amounts. The primary assumptions include factors such as discount rates, expected investment return on plan assets, mortality rates and retirement rates. The discount rates, expected investment return on plan assets, mortality rates and retirement rates are determined based on reference to yields, and are reviewed annually and considered for adjustment to reflect current market conditions. The expected return on plan assets is derived from detailed periodic studies, which include a review of asset allocation strategies, anticipated future long-term performance of individual asset classes, risks (standard deviations) and correlations of returns among the asset classes that comprise the plans’ asset mix. While the studies give appropriate consideration to recent plan performance and historical returns, the assumptions are primarily long-term, prospective rates of return. Mortality and retirement rates are based on actual and anticipated plan experience. In accordance with GAAP, actual results that differ from the assumptions are accumulated and are subject to amortization over future periods and, therefore, generally affect recognized expense in future periods. While we believe that the assumptions used are appropriate, differences in actual experience or changes in assumptions may affect the pension obligation and future expense. |
Reclassifications | Reclassifications. Certain amounts in prior periods have been reclassified to conform to the current year presentation, including the separate presentation and reporting of discontinued operations. Such reclassifications did not have any effect on our financial condition or results of operations as previously reported. |
Newly Adopted Accounting Standards and Accounting Standards Not Yet Adopted | Newly Adopted Accounting Standards ASU No. 2020-06. In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity , which simplifies the accounting for convertible instruments by eliminating certain separation models and will generally be reported as a single liability at its amortized cost. In addition, ASU 2020-06 eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. On January 1, 2022, we adopted the ASU using the modified retrospective method. We recognized a cumulative effect of initially applying the ASU as an adjustment to the January 1, 2022 opening accumulated deficit balance. The prior period consolidated financial statements have not been retrospectively adjusted and continue to be reported under the accounting standards in effect for those periods. Refer to Note 12 - Debt for impact on the adoption of this ASU as of January 1, 2022. Accounting Standards Not Yet Adopted ASU No. 2020-04. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . The guidance in ASU 2020-04 and ASU 2021-01, Reference Rate Reform (Topic 848): Scope , which was issued in January 2021, provides optional expedients and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria that reference LIBOR or another rate that is expected to be discontinued. The amendments in ASU 2020-04 are effective for all entities as of March 12, 2020 through December 31, 2022. While we are currently determining whether we will elect the optional expedients, we do not expect our adoption of these ASUs to have a significant impact on our consolidated financial position, results of operations, and cash flows. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Estimated Useful Lives of Assets | Depreciation and amortization of assets are computed by the straight-line method over the following estimated useful lives of the assets: Classification Useful Life Buildings 20-40 years Enterprise Resource Planning (“ERP”) System 15 years Leasehold improvements 2-15 years Machinery and equipment 2-12 years Furniture and fixtures 2-10 years Computers and computer software 2-5 years Automobiles 2-5 years |
Non-Cash Investing and Financing Activities | Non-cash investing and financing activities are excluded from the condensed consolidated statements of cash flows and are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Assets acquired under finance lease $ 752 $ 611 $ 852 $ 1,017 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The table below represents the reconciliation of the major line items consisting of pretax income from discontinued operations to the after-tax income from discontinued operations (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Major classes of line items constituting income (loss) from discontinued operations Revenues $ 29,441 $ 19,531 $ 88,704 $ 59,858 Operating expenses (12,052) (10,720) (39,508) (32,878) Selling, general and administrative expenses (8,832) (7,109) (26,422) (19,531) Restructuring and other related charges, net — — — (297) Interest expense, net (78) (61) (108) (204) Other expense (2,675) (856) (4,934) (1,964) Income before income taxes from discontinued operations 5,804 785 17,732 4,984 Provision for income taxes (2,057) (1,521) (1,464) (1,004) Net income (loss) from discontinued operations $ 3,747 $ (736) $ 16,268 $ 3,980 The table below represents the reconciliation of the major classes of assets and liabilities of the discontinued operations to amounts presented separately in the condensed consolidated balance sheets (in thousands): September 30, 2022 December 31, 2021 (unaudited) Carrying amount of major classes of assets included as part of discontinued operations Cash and cash equivalents $ 10,641 $ 10,122 Accounts receivable, net 25,640 20,499 Prepaid expenses and other current assets 8,077 3,805 Property, plant and equipment, net 17,131 15,879 Goodwill and intangible assets, net 25,311 26,823 Other classes of assets that are not major 1,870 5,968 Total assets associated with discontinued operations $ 88,670 $ 83,096 Carrying amounts of major classes of liabilities included as part of discontinued operations Accounts payable $ 1,923 $ 2,125 Other accrued liabilities 13,162 9,363 Operating lease obligations 1,812 2,368 Other classes of liabilities that are not major 2,478 2,540 Total liabilities associated with discontinued operations $ 19,375 $ 16,396 The following table presents the depreciation and amortization and capital expenditures of Quest Integrity (in thousands): Nine Months Ended September 30, 2022 2021 Cash flows provided by operating activities of discontinued operations: Depreciation and amortization $ 1,143 $ 2,016 Cash flows provided by investing activities of discontinued operations: Capital expenditures $ 3,703 $ 2,365 |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
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): Geographic area: Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 108,009 $ 2,303 $ 110,312 $ 98,812 $ 2,664 $ 101,476 MS 76,135 31,892 108,027 63,885 32,518 96,403 Total $ 184,144 $ 34,195 $ 218,339 $ 162,697 $ 35,182 $ 197,879 Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 (unaudited) (unaudited) United States and Canada Other Countries Total United States and Canada Other Countries Total Revenue: IHT $ 312,928 $ 7,105 $ 320,033 $ 302,871 $ 7,206 $ 310,077 MS 217,749 91,135 308,884 189,234 91,732 280,966 Total $ 530,677 $ 98,240 $ 628,917 $ 492,105 $ 98,938 $ 591,043 Operating segment and service type: Three Months Ended September 30, 2022 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 87,267 $ 19 $ 16,357 $ 6,669 $ 110,312 MS — 106,776 125 1,126 108,027 Total $ 87,267 $ 106,795 $ 16,482 $ 7,795 $ 218,339 Three Months Ended September 30, 2021 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 80,553 $ 56 $ 11,928 $ 8,939 $ 101,476 MS — 95,560 71 772 96,403 Total $ 80,553 $ 95,616 $ 11,999 $ 9,711 $ 197,879 Nine Months Ended September 30, 2022 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 255,419 $ 158 $ 45,983 $ 18,473 $ 320,033 MS — 305,277 238 3,369 308,884 Total $ 255,419 $ 305,435 $ 46,221 $ 21,842 $ 628,917 Nine Months Ended September 30, 2021 (unaudited) Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 244,374 $ 344 $ 42,650 $ 22,709 $ 310,077 MS — 278,685 768 1,513 280,966 Total $ 244,374 $ 279,029 $ 43,418 $ 24,222 $ 591,043 |
Contract with Customer, Asset and Liability | The following table provides information about trade accounts receivable, contract assets and contract liabilities as of September 30, 2022 and December 31, 2021 (in thousands): September 30, 2022 December 31, 2021 Change (unaudited) Trade accounts receivable, net 1 $ 213,684 $ 188,772 $ 24,912 Contract assets 2 $ 2,320 $ 1,602 $ 718 Contract liabilities 3 $ 2,071 $ 313 $ 1,758 Trade accounts receivable, contract assets and contract liabilities - discontinued operations 4 $ 30,000 $ 22,366 $ 7,634 _________________ 1 Includes billed and unbilled amounts, net of allowance for credit losses. See Note 4 - Receivables for details. 2 Portion of continued operations is included in the “Prepaid expenses and other current assets” line on the condensed consolidated balance sheets. 3 Portion of continued operations is included in the “Other accrued liabilities” line of the condensed consolidated balance sheets. 4 The total of trade accounts receivable, contract assets, contract liabilities and net accounts receivable of discontinued operations, which is included in the respective lines above. |
RECEIVABLES (Tables)
RECEIVABLES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Receivables [Abstract] | |
Summary of Accounts Receivable | A summary of accounts receivable as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Trade accounts receivable $ 171,908 $ 161,751 Unbilled receivables 47,642 35,933 Allowance for credit losses (5,866) (8,912) Total 213,684 188,772 Accounts receivable, net - discontinued operations (25,640) (20,499) Accounts receivable, net - continuing operations $ 188,044 $ 168,273 |
Allowance for Credit Loss | The following table shows a rollforward of the allowance for credit losses (in thousands): September 30, 2022 December 31, 2021 (unaudited) Balance at beginning of period $ 8,912 $ 9,918 Expected credit loss adjustment 1 (442) 2,193 Write-offs (2,414) (3,143) Foreign exchange effects (190) (56) Balance at end of period 5,866 8,912 Allowance for credit losses - discontinued operations (1,061) (1,069) Allowance for credit losses - continuing operations $ 4,805 $ 7,843 _________________ 1 Includes $0.7 million and $0.5 million of recoveries on allowance for credit losses, for the nine months ended September 30, 2022 and twelve months ended December 31, 2021, respectively. |
INVENTORY (Tables)
INVENTORY (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Summary of Inventory | A summary of inventory as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Raw materials $ 8,811 $ 7,641 Work in progress 3,225 2,725 Finished goods 24,956 25,388 Total 36,992 35,754 Total inventory - discontinued operations — (379) Total inventory - continuing operations $ 36,992 $ 35,375 |
PREPAID AND OTHER CURRENT ASS_2
PREPAID AND OTHER CURRENT ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Current Assets | A summary of prepaid and other current assets as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Insurance receivable $ 39,000 $ 39,000 Prepaid expenses 17,506 12,645 Other current assets 17,448 8,223 Total 73,954 59,868 Prepaid and other current assets - discontinued operations (8,077) (3,805) Prepaid and other current assets - continuing operations $ 65,877 $ 56,063 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | A summary of property, plant and equipment as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Land $ 4,523 $ 5,743 Buildings and leasehold improvements 53,803 58,972 Machinery and equipment 298,327 306,366 Furniture and fixtures 11,301 11,642 Capitalized ERP system development costs 45,917 45,917 Computers and computer software 22,328 22,243 Automobiles 4,379 4,356 Construction in progress 27,678 16,565 Total 468,256 471,804 Accumulated depreciation (312,628) (310,445) Property, plant and equipment, net 155,628 161,359 Property, plant and equipment, net - discontinued operations (17,131) (15,879) Property, plant and equipment, net - continuing operations $ 138,497 $ 145,480 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | A summary of intangible assets as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Gross Accumulated Net Gross Accumulated Net Customer relationships $ 174,400 $ (97,362) $ 77,038 $ 175,156 $ (88,783) $ 86,373 Non-compete agreements 5,288 (5,288) — 5,503 (5,503) — Trade names 24,520 (22,417) 2,103 24,743 (22,252) 2,491 Technology 7,784 (6,998) 786 7,843 (6,885) 958 Licenses 827 (800) 27 850 (774) 76 Total $ 212,819 $ (132,865) $ 79,954 $ 214,095 $ (124,197) $ 89,898 Intangible assets - discontinued operations (19,468) 18,094 (1,374) (20,186) 18,606 (1,580) Intangible assets - continuing operations $ 193,351 $ (114,771) $ 78,580 $ 193,909 $ (105,591) $ 88,318 |
OTHER ACCRUED LIABILITIES (Tabl
OTHER ACCRUED LIABILITIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Payables and Accruals [Abstract] | |
Summary of Other Accrued Liabilities | A summary of other accrued liabilities as of September 30, 2022 and December 31, 2021 is as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Legal and professional accruals $ 47,475 $ 46,762 Payroll and other compensation expenses 50,101 44,284 Insurance accruals 6,820 7,314 Property, sales and other non-income related taxes 6,701 8,018 Accrued commission 1,481 1,111 Accrued interest 8,070 6,469 Other 8,991 7,141 Total $ 129,639 $ 121,099 Other accrued liabilities - discontinued operations (13,162) (9,363) Other accrued liabilities - continuing operations $ 116,477 $ 111,736 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Team’s current and long-term debt obligations consisted of the following (in thousands): September 30, 2022 December 31, 2021 (unaudited) ABL Facilities $ 129,816 $ 62,000 Atlantic Park Term Loan 234,443 214,191 Subordinated Term Loan 46,132 36,358 Total $ 410,391 $ 312,549 Notes 1 95,125 87,662 Finance lease obligations 2 5,708 5,640 Total debt and finance lease obligations $ 511,224 $ 405,851 Current portion of long-term debt and finance lease obligations (506,414) (667) Total long-term debt and finance lease obligations, less current portion $ 4,810 $ 405,184 _________________ 1 Comprised of principal amount outstanding, less unamortized discount and issuance costs. See Convertible Debt section below for additional information. 2 Excludes finance lease obligations associated with discontinued operations. |
Schedule of Convertible Debt | As of September 30, 2022 and December 31, 2021, the Notes were recorded in our condensed consolidated balance sheets as follows (in thousands): September 30, 2022 December 31, 2021 (unaudited) Liability component: Principal $ 97,372 $ 93,130 Unamortized issuance costs (1,378) (916) Unamortized discount (869) (4,552) Net carrying amount of the liability component 1 $ 95,125 $ 87,662 Equity component: Carrying amount of the equity component, net of issuance costs 2 $ — $ 7,969 Carrying amount of the equity component, net of issuance costs 3 $ 37,276 $ 37,276 _________________ 1 Included in the “Current portion of long-term debt and finance lease obligations” 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. 3 Relates to the portion of the Notes accounted for under ASC 815-15 (defined below) and is included in the “Additional paid-in capital” line of the condensed consolidated balance sheets. The following table sets forth interest expense information related to the Notes (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Coupon interest 1 $ 1,624 $ 1,164 $ 4,801 $ 3,492 Amortization of debt discount and issuance costs 785 791 2,105 2,326 Total interest expense $ 2,409 $ 1,955 $ 6,906 $ 5,818 Effective interest rate 10.28 % 9.12 % 10.28 % 9.12 % _____________ 1 Coupon interest for three and nine months ended September 30, 2022 includes PIK Interest of $1.1 million and $3.3 million, respectivel y. |
Schedule of Error Corrections and Prior Period Adjustments | Accordingly, the cumulative effect of the changes made on our January 1, 2022 condensed consolidated balance sheet for the adoption of the ASU was as follows (in thousands): Balances at December 31, 2021 Adjustments from Adoption of ASU 2020-06 Balances at January 1, 2022 Liabilities Long-term debt and finance lease obligations $ 405,191 $ 1,827 $ 407,018 Equity Additional paid-in capital $ 444,824 $ (5,651) $ 439,173 Accumulated deficit $ (375,584) $ 3,824 $ (371,760) |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Lease, Cost | The components of lease expense are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Operating lease costs $ 6,035 $ 6,784 $ 19,056 $ 21,044 Variable lease costs 1,057 1,503 3,958 4,106 Finance lease costs: Amortization of right-of-use assets 237 155 498 467 Interest on lease liabilities 143 84 269 252 Total lease cost 7,472 8,526 23,781 25,869 Lease cost - discontinued operations $ 126 $ (472) $ (785) $ (1,169) Lease cost - continuing operations $ 7,598 $ 8,054 $ 22,996 $ 24,700 |
Schedule of Other Information Related to Leases | Other information related to leases are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Supplemental cash flow information: (unaudited) (unaudited) (unaudited) (unaudited) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 4,934 $ 6,226 $ 15,434 $ 17,569 Operating cash flows from finance leases 89 81 204 252 Financing cash flows from finance leases 295 119 615 356 Right-of-use assets obtained in exchange for lease obligations Operating leases 1,343 721 2,697 9,304 Finance leases 752 611 852 1,017 |
Amounts Recognized in Balance Sheet for Leases | Amounts recognized in the condensed consolidated balance sheets are as follows (in thousands): September 30, 2022 December 31, 2021 Operating Leases: (unaudited) Operating lease right-of-use assets, continuing operations $ 48,189 $ 58,495 Operating lease right-of-use assets, discontinued operations 1,872 2,205 Current portion of operating lease obligations, continuing operations 13,328 15,412 Current portion of operating lease obligations, discontinued operations 812 764 Operating lease obligations (non-current), continuing operations 39,144 47,617 Operating lease obligations (non-current), discontinued operations 1,000 1,604 Finance Leases: Finance lease right-of-use assets, continuing operations $ 4,909 $ 5,114 Finance lease right-of-use assets, discontinued operations 6 9 Current portion of finance lease obligations, continuing operations 898 667 Current portion of finance lease obligations, discontinued operations 2 2 Long-term finance lease obligations, continuing operations 4,810 4,973 Long-term finance lease obligations, discontinued operations 4 7 Weighted average remaining lease term: Operating leases 5.8 years 6.0 years Finance leases 9.1 years 10.0 years Weighted average discount rate: Operating leases 7.1 % 6.8 % Finance leases 7.0 % 6.4 % |
Schedule of Finance Lease Liability | As of September 30, 2022, future minimum lease payments under non-cancellable leases (including short-term leases) are as follows (in thousands): Operating Leases Finance Leases (unaudited) (unaudited) 2022 (Remainder of the year) $ 5,774 $ 424 2023 15,146 1,197 2024 12,058 954 2025 8,711 667 2026 6,654 608 Thereafter 17,553 3,925 Total future minimum lease payments 65,896 7,775 Less: Interest 13,424 2,067 Present value of lease liabilities $ 52,472 $ 5,708 |
Schedule of Operating Lease Liability | As of September 30, 2022, future minimum lease payments under non-cancellable leases (including short-term leases) are as follows (in thousands): Operating Leases Finance Leases (unaudited) (unaudited) 2022 (Remainder of the year) $ 5,774 $ 424 2023 15,146 1,197 2024 12,058 954 2025 8,711 667 2026 6,654 608 Thereafter 17,553 3,925 Total future minimum lease payments 65,896 7,775 Less: Interest 13,424 2,067 Present value of lease liabilities $ 52,472 $ 5,708 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Transactions Involving Stock Units and Director Stock Grants | Transactions involving our stock units and director stock grants for the nine months ended September 30, 2022 are summarized below: Nine Months Ended (unaudited) No. of Stock Weighted (in thousands) Stock and stock units, beginning of year 804 $ 7.27 Changes during the period: Granted 525 $ 1.30 Vested and settled (135) $ 7.16 Forfeited and cancelled (101) $ 6.95 Stock and stock units, end of period 1,093 $ 4.44 |
Summary of Transactions Involving Performance Awards | Transactions involving our performance awards during the nine months ended September 30, 2022 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 No. of Stock Units 1 Weighted (in thousands) (in thousands) Performance stock units, beginning of period 684 $ 6.45 219 $ 9.91 Changes during the period: Granted — — — — Vested and settled — — — — Cancelled (653) $ 6.04 (188) $ 9.61 Performance stock units, end of period 31 $ 14.96 31 $ 11.69 _________________ |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
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, 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Interest cost $ 358 $ 322 1,171 $ 970 Expected return on plan assets (533) (504) (1,744) (1,515) Amortization of prior service cost 7 9 23 26 Net periodic pension credit $ (168) $ (173) $ (550) $ (519) |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
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 Foreign Defined Benefit Pension Plans Tax Total Foreign Foreign Defined Benefit Pension Plans Tax Total Balance, beginning of period $ (23,287) $ — $ (3,277) $ (169) $ (26,732) $ (23,045) $ 2,988 $ (8,021) $ 400 $ (27,678) Other comprehensive loss (12,152) — — — (12,152) (2,210) — — 536 (1,674) Balance, end of period $ (35,439) $ — $ (3,277) $ (169) $ (38,884) $ (25,255) $ 2,988 $ (8,021) $ 936 $ (29,352) |
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 Tax Net Gross Tax Net Foreign currency translation adjustments $ (12,152) — $ (12,152) $ (2,210) $ 536 $ (1,674) Total $ (12,152) $ — $ (12,152) $ (2,210) $ 536 $ (1,674) |
SEGMENT AND GEOGRAPHIC DISCLO_2
SEGMENT AND GEOGRAPHIC DISCLOSURES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Data for our Three Operating Segments | Segment data for our two operating segments are as follows (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Revenues: IHT $ 110,312 $ 101,476 $ 320,033 $ 310,077 MS 108,027 96,403 308,884 280,966 Continuing operations total $ 218,339 $ 197,879 $ 628,917 $ 591,043 Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Operating income (loss): IHT $ 7,390 $ 3,065 $ 13,038 $ 10,824 MS 7,655 (53,242) 15,152 (50,799) Corporate and shared support services (16,774) (22,051) (63,119) (67,997) Continuing operations total $ (1,729) $ (72,228) $ (34,929) $ (107,972) Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Capital expenditures 1 : IHT $ 2,557 $ 1,454 $ 10,654 $ 6,625 MS 1,427 741 3,861 3,260 Corporate and shared support services 274 293 331 714 Continuing operations total $ 4,258 $ 2,488 $ 14,846 $ 10,599 _____________ 1 Excludes finance leases. Totals may vary from amounts presented in the consolidated statements of cash flows due to the timing of cash payments. Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Depreciation and amortization: IHT $ 3,022 $ 3,148 $ 9,372 $ 9,888 MS 4,704 4,950 14,222 15,432 Corporate and shared support services 1,261 1,418 3,855 4,080 Continuing operations total $ 8,987 $ 9,516 $ 27,449 $ 29,400 |
Geographic Breakdown of Revenues | A geographic breakdown of our revenues for the three and nine months ended September 30, 2022 and 2021 is as follows (unaudited, in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 (unaudited) (unaudited) (unaudited) (unaudited) Total Revenues 1 United States $ 173,890 $ 143,636 $ 497,236 $ 447,932 Canada 28,193 30,465 84,704 81,110 Europe 24,869 27,122 75,546 82,098 Other foreign countries 20,828 16,187 60,135 39,761 Total $ 247,780 $ 217,410 $ 717,621 $ 650,901 Discontinued operations revenue (29,441) (19,531) (88,704) (59,858) Total continuing operations revenue $ 218,339 $ 197,879 $ 628,917 $ 591,043 ______________ 1 Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
SEVERANCE AND OTHER CHARGES (Ta
SEVERANCE AND OTHER CHARGES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Accrued Severance Liability | A rollforward of our accrued severance liability associated with our ongoing cost reduction efforts is presented below (in thousands): Nine Months Ended (unaudited) Balance, beginning of period $ 712 Charges 3,028 Payments (1,952) Balance, end of period $ 1,788 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||
Nov. 01, 2022 USD ($) | Oct. 04, 2022 USD ($) | Aug. 15, 2022 segment | Aug. 14, 2022 segment | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) segment profile | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) segment | Dec. 31, 2022 USD ($) | Jun. 27, 2022 USD ($) | Feb. 11, 2022 USD ($) | Jan. 31, 2022 USD ($) | Jan. 13, 2022 USD ($) | Nov. 09, 2021 USD ($) | Dec. 31, 2020 USD ($) | Jul. 31, 2017 | |
Significant Accounting Policies [Line Items] | ||||||||||||||||
Number of operating segments | segment | 2 | 2 | 2 | 3 | ||||||||||||
Number of client demand profiles | profile | 3 | |||||||||||||||
Deferred employer payroll taxes | $ 14,100,000 | $ 7,000,000 | ||||||||||||||
Goodwill | $ 0 | 0 | ||||||||||||||
Goodwill impairment charges | 0 | $ 55,837,000 | ||||||||||||||
Workers compensation our self-insured retention | 1,000,000 | |||||||||||||||
Automobile liability self-insured retention | 2,000,000 | |||||||||||||||
General Liability Claims | 1,000,000 | |||||||||||||||
Self-insured retention | 5,000,000 | |||||||||||||||
Medical claims, our self-insured retention | 400,000 | |||||||||||||||
Environmental liability claims, our self-insured retention | 1,000,000 | |||||||||||||||
Accrued capital expenditures | 1,400,000 | 1,700,000 | ||||||||||||||
MS | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Goodwill impairment charges | $ 55,800,000 | 55,800,000 | ||||||||||||||
Subsequent Event | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Repayments of debt | $ 238,000,000 | |||||||||||||||
Repayment of principal debt balance | 225,000,000 | |||||||||||||||
Forecasted | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Deferred employer payroll taxes | $ 7,100,000 | |||||||||||||||
Forecasted | Discontinued Operations | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Deferred employer payroll taxes | $ 500,000 | |||||||||||||||
TQ Acquisition, Inc | Subsequent Event | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Purchase and sale agreement, consideration | 279,000,000 | |||||||||||||||
Quest Integrity | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Number of operating segments | segment | 2 | |||||||||||||||
Accrued capital expenditures | 20,000 | 300,000 | ||||||||||||||
Quest Integrity | Subsequent Event | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Purchase and sale agreement, consideration | $ 279,000,000 | |||||||||||||||
COVID-19 | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Operating expenses | 1,800,000 | 600,000 | 5,600,000 | |||||||||||||
Selling, general and administrative expenses | $ 300,000 | 100,000 | $ 1,000,000 | |||||||||||||
Convertible debt | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, interest rate, stated percentage | 5% | |||||||||||||||
Principal amount, long-term debt issued | 97,400,000 | $ 97,400,000 | ||||||||||||||
Periodic payment | 10,000,000 | |||||||||||||||
Fair value of our convertible senior notes | $ 10,000,000 | |||||||||||||||
Convertible debt | PIK Securities | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Principal amount, long-term debt issued | $ 52,000,000 | |||||||||||||||
Convertible debt | Subsequent Event | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Principal amount, long-term debt issued | $ 41,200,000 | |||||||||||||||
Convertible debt | Subsequent Event | PIK Securities | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, interest rate, stated percentage | 5% | |||||||||||||||
Principal amount, long-term debt issued | $ 41,200,000 | |||||||||||||||
Debt conversion, principle amount | 57,000,000 | |||||||||||||||
Convertible debt | Fair Value, Inputs, Level 2 | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Fair value of our convertible senior notes | $ 84,000,000 | |||||||||||||||
Subordinated Debt | PIK Securities | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, interest rate, stated percentage | 12% | |||||||||||||||
Subordinated Debt | Subordinated Term Loan | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, interest rate, stated percentage | 12% | 12% | ||||||||||||||
Principal amount, long-term debt issued | $ 50,000,000 | |||||||||||||||
Subordinated Debt | Delayed Draw Term Loan | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Principal amount, long-term debt issued | $ 10,000,000 | $ 10,000,000 | ||||||||||||||
Subordinated Debt | Subsequent Event | Subordinated Term Loan | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Principal amount, long-term debt issued | 112,700,000 | |||||||||||||||
Subordinated Debt | Subsequent Event | Delayed Draw Term Loan | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Principal amount, long-term debt issued | $ 10,000,000 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Estimated Useful Lives of Assets (Detail) | 9 Months Ended |
Sep. 30, 2022 | |
Enterprise Resource Planning (“ERP”) System | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 15 years |
Minimum | Buildings | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 20 years |
Minimum | Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 2 years |
Minimum | Machinery and equipment | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 2 years |
Minimum | Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 2 years |
Minimum | Computers and computer software | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 2 years |
Minimum | Automobiles | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 2 years |
Maximum | Buildings | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 40 years |
Maximum | Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 15 years |
Maximum | Machinery and equipment | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 12 years |
Maximum | Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 10 years |
Maximum | Computers and computer software | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 5 years |
Maximum | Automobiles | |
Property, Plant and Equipment [Line Items] | |
Useful Life (in years) | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Non-Cash Investing and Financing Activities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Continuing Operations | ||||
Significant Accounting Policies [Line Items] | ||||
Assets acquired under finance lease | $ 752 | $ 611 | $ 852 | $ 1,017 |
DISCONTINUED OPERATIONS - Addit
DISCONTINUED OPERATIONS - Additional Information (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | ||||
Nov. 01, 2022 USD ($) | Aug. 15, 2022 segment | Aug. 14, 2022 segment | Sep. 30, 2022 USD ($) segment | Sep. 30, 2021 USD ($) | Dec. 31, 2021 segment | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Number of operating segments | segment | 2 | 2 | 2 | 3 | ||
Accrued capital expenditures | $ 1,400 | $ 1,700 | ||||
Subsequent Event | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Repayment of principal debt balance | $ 225,000 | |||||
Quest Integrity | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Number of operating segments | segment | 2 | |||||
Accrued capital expenditures | $ 20 | $ 300 | ||||
Quest Integrity | Subsequent Event | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Purchase and sale agreement, consideration | $ 279,000 |
DISCONTINUED OPERATIONS - Sched
DISCONTINUED OPERATIONS - Schedule of Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Major classes of line items constituting income (loss) from discontinued operations | |||||
Revenues | $ 29,441 | $ 19,531 | $ 88,704 | $ 59,858 | |
Net income (loss) from discontinued operations | 3,747 | (736) | 16,268 | 3,980 | |
Carrying amount of major classes of assets included as part of discontinued operations | |||||
Accounts receivable, net | 25,640 | 25,640 | $ 20,499 | ||
Prepaid expenses and other current assets | 8,077 | 8,077 | 3,805 | ||
Carrying amounts of major classes of liabilities included as part of discontinued operations | |||||
Other accrued liabilities | 13,162 | 13,162 | 9,363 | ||
Quest Integrity | |||||
Major classes of line items constituting income (loss) from discontinued operations | |||||
Revenues | 29,441 | 19,531 | 88,704 | 59,858 | |
Operating expenses | (12,052) | (10,720) | (39,508) | (32,878) | |
Selling, general and administrative expenses | (8,832) | (7,109) | (26,422) | (19,531) | |
Restructuring and other related charges, net | 0 | 0 | 0 | (297) | |
Interest expense, net | (78) | (61) | (108) | (204) | |
Other expense | (2,675) | (856) | (4,934) | (1,964) | |
Income before income taxes from discontinued operations | 5,804 | 785 | 17,732 | 4,984 | |
Provision for income taxes | (2,057) | (1,521) | (1,464) | (1,004) | |
Net income (loss) from discontinued operations | 3,747 | $ (736) | 16,268 | 3,980 | |
Carrying amount of major classes of assets included as part of discontinued operations | |||||
Cash and cash equivalents | 10,641 | 10,641 | 10,122 | ||
Accounts receivable, net | 25,640 | 25,640 | 20,499 | ||
Prepaid expenses and other current assets | 8,077 | 8,077 | 3,805 | ||
Property, plant and equipment, net | 17,131 | 17,131 | 15,879 | ||
Goodwill and intangible assets, net | 25,311 | 25,311 | 26,823 | ||
Other classes of assets that are not major | 1,870 | 1,870 | 5,968 | ||
Total assets associated with discontinued operations | 88,670 | 88,670 | 83,096 | ||
Carrying amounts of major classes of liabilities included as part of discontinued operations | |||||
Accounts payable | 1,923 | 1,923 | 2,125 | ||
Other accrued liabilities | 13,162 | 13,162 | 9,363 | ||
Operating lease obligations | 1,812 | 1,812 | 2,368 | ||
Other classes of liabilities that are not major | 2,478 | 2,478 | 2,540 | ||
Total liabilities associated with discontinued operations | $ 19,375 | 19,375 | $ 16,396 | ||
Cash flows provided by operating activities of discontinued operations: | |||||
Depreciation and amortization | 1,143 | 2,016 | |||
Cash flows provided by investing activities of discontinued operations: | |||||
Capital expenditures | $ 3,703 | $ 2,365 |
REVENUE - Disaggregation of Rev
REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 247,780 | $ 217,410 | $ 717,621 | $ 650,901 |
Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 218,339 | 197,879 | 628,917 | 591,043 |
Non-Destructive Evaluation and Testing Services | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 87,267 | 80,553 | 255,419 | 244,374 |
Repair and Maintenance Services | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 106,795 | 95,616 | 305,435 | 279,029 |
Heat Treating | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 16,482 | 11,999 | 46,221 | 43,418 |
Other | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 7,795 | 9,711 | 21,842 | 24,222 |
United States and Canada | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 184,144 | 162,697 | 530,677 | 492,105 |
Other Countries | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 34,195 | 35,182 | 98,240 | 98,938 |
IHT | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 110,312 | 101,476 | 320,033 | 310,077 |
IHT | Non-Destructive Evaluation and Testing Services | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 87,267 | 80,553 | 255,419 | 244,374 |
IHT | Repair and Maintenance Services | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 19 | 56 | 158 | 344 |
IHT | Heat Treating | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 16,357 | 11,928 | 45,983 | 42,650 |
IHT | Other | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 6,669 | 8,939 | 18,473 | 22,709 |
IHT | United States and Canada | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 108,009 | 98,812 | 312,928 | 302,871 |
IHT | Other Countries | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 2,303 | 2,664 | 7,105 | 7,206 |
MS | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 108,027 | 96,403 | 308,884 | 280,966 |
MS | Non-Destructive Evaluation and Testing Services | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
MS | Repair and Maintenance Services | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 106,776 | 95,560 | 305,277 | 278,685 |
MS | Heat Treating | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 125 | 71 | 238 | 768 |
MS | Other | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,126 | 772 | 3,369 | 1,513 |
MS | United States and Canada | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 76,135 | 63,885 | 217,749 | 189,234 |
MS | Other Countries | Continuing Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 31,892 | $ 32,518 | $ 91,135 | $ 91,732 |
REVENUE - Contract Balances (De
REVENUE - Contract Balances (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | ||
Trade accounts receivable, net | $ 213,684 | $ 188,772 |
Contract assets | 2,320 | 1,602 |
Contract liabilities | 2,071 | 313 |
Trade accounts receivable, contract assets and contract liabilities - discontinued operations | 30,000 | $ 22,366 |
Change in trade accounts receivable, net | 24,912 | |
Change in contract assets | 718 | |
Change in contract liability | 1,758 | |
Change in trade accounts receivable, contract assets and contract liabilities of discontinued operations | 7,634 | |
Increase in contract asset | 700 | |
Increase in contract liability | $ 1,800 |
RECEIVABLES - Summary of Accoun
RECEIVABLES - Summary of Accounts Receivable (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Trade accounts receivable | $ 171,908 | $ 161,751 | |
Unbilled receivables | 47,642 | 35,933 | |
Allowance for credit losses | (5,866) | (8,912) | $ (9,918) |
Accounts receivable, net - discontinued operations | (25,640) | (20,499) | |
Total | $ 213,684 | 188,772 | |
Accounts receivable, payment terms | 30 days | ||
Continuing Operations | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Allowance for credit losses | $ (4,805) | (7,843) | |
Total | $ 188,044 | $ 168,273 |
RECEIVABLES - Summary of Activi
RECEIVABLES - Summary of Activity in Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of period | $ 8,912 | $ 9,918 |
Expected credit loss adjustment1 | (442) | 2,193 |
Write-offs | (2,414) | (3,143) |
Foreign exchange effects | (190) | (56) |
Allowance for credit losses - discontinued operations | (1,061) | (1,069) |
Balance at end of period | 5,866 | 8,912 |
Recoveries on allowance | 700 | 500 |
Continuing Operations | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of period | 7,843 | |
Balance at end of period | $ 4,805 | $ 7,843 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory [Line Items] | ||
Raw materials | $ 8,811 | $ 7,641 |
Work in progress | 3,225 | 2,725 |
Finished goods | 24,956 | 25,388 |
Total inventory - discontinued operations | 0 | (379) |
Total | 36,992 | 35,754 |
Continuing Operations | ||
Inventory [Line Items] | ||
Total | $ 36,992 | $ 35,375 |
PREPAID AND OTHER CURRENT ASS_3
PREPAID AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Insurance receivable | $ 39,000 | $ 39,000 |
Prepaid expenses | 17,506 | 12,645 |
Other current assets | 17,448 | 8,223 |
Total | 73,954 | 59,868 |
Prepaid and other current assets - discontinued operations | (8,077) | (3,805) |
Debt issuance costs, current, net | 4,800 | |
Debt issuance costs, net | 39,400 | 58,000 |
1970 Group | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Debt issuance costs, net | 2,900 | |
Continuing Operations | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Total | $ 65,877 | $ 56,063 |
PROPERTY, PLANT AND EQUIPMENT -
PROPERTY, PLANT AND EQUIPMENT - Summary of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||||
Total | $ 468,256 | $ 468,256 | $ 471,804 | ||
Accumulated depreciation | (312,628) | (312,628) | (310,445) | ||
Property, plant and equipment, net | 155,628 | 155,628 | 161,359 | ||
Property, plant and equipment, net - discontinued operations | (17,131) | (17,131) | (15,879) | ||
Assets under finance leases | 7,000 | 7,000 | 6,700 | ||
Accumulated amortization for assets under finance leases | 2,100 | 2,100 | 1,600 | ||
Depreciation expense | 5,500 | $ 6,700 | 18,300 | $ 21,000 | |
Continuing Operations | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, net | 138,497 | 138,497 | 145,480 | ||
Land | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 4,523 | 4,523 | 5,743 | ||
Buildings and leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 53,803 | 53,803 | 58,972 | ||
Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 298,327 | 298,327 | 306,366 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 11,301 | 11,301 | 11,642 | ||
Capitalized ERP system development costs | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 45,917 | 45,917 | 45,917 | ||
Computers and computer software | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 22,328 | 22,328 | 22,243 | ||
Automobiles | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | 4,379 | 4,379 | 4,356 | ||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Total | $ 27,678 | $ 27,678 | $ 16,565 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Long-Lived Assets Held-for-sale [Line Items] | |||||
Assets under finance leases | $ 7 | $ 7 | $ 6.7 | ||
Accumulated amortization for assets under finance leases | 2.1 | 2.1 | 1.6 | ||
Depreciation expense | $ 5.5 | $ 6.7 | 18.3 | $ 21 | |
Assets sold and disposed, cost basis | 10.1 | 2.8 | |||
Machinery and equipment | |||||
Long-Lived Assets Held-for-sale [Line Items] | |||||
Assets sold and disposed, cost basis | 5.8 | 2.5 | |||
Buildings | |||||
Long-Lived Assets Held-for-sale [Line Items] | |||||
Assets sold and disposed, cost basis | 2.1 | ||||
Land | |||||
Long-Lived Assets Held-for-sale [Line Items] | |||||
Assets sold and disposed, cost basis | 1.3 | ||||
Leasehold improvements | |||||
Long-Lived Assets Held-for-sale [Line Items] | |||||
Assets sold and disposed, cost basis | 0.8 | ||||
Other assets | |||||
Long-Lived Assets Held-for-sale [Line Items] | |||||
Assets sold and disposed, cost basis | $ 0.1 | 0.1 | |||
Vehicles | |||||
Long-Lived Assets Held-for-sale [Line Items] | |||||
Assets sold and disposed, cost basis | $ 0.2 |
INTANGIBLE ASSETS - Summary of
INTANGIBLE ASSETS - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 212,819 | $ 214,095 |
Accumulated Amortization | (132,865) | (124,197) |
Net Carrying Amount | 79,954 | 89,898 |
Gross Carrying Amount, discontinued operations | (19,468) | (20,186) |
Accumulated Amortization, discontinued operations | 18,094 | 18,606 |
Net Carrying Amount, discontinued operations | (1,374) | (1,580) |
Continuing Operations | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 193,351 | 193,909 |
Accumulated Amortization | (114,771) | (105,591) |
Net Carrying Amount | 78,580 | 88,318 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 174,400 | 175,156 |
Accumulated Amortization | (97,362) | (88,783) |
Net Carrying Amount | 77,038 | 86,373 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 5,288 | 5,503 |
Accumulated Amortization | (5,288) | (5,503) |
Net Carrying Amount | 0 | 0 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 24,520 | 24,743 |
Accumulated Amortization | (22,417) | (22,252) |
Net Carrying Amount | 2,103 | 2,491 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 7,784 | 7,843 |
Accumulated Amortization | (6,998) | (6,885) |
Net Carrying Amount | 786 | 958 |
Licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 827 | 850 |
Accumulated Amortization | (800) | (774) |
Net Carrying Amount | $ 27 | $ 76 |
INTANGIBLE ASSETS - Additional
INTANGIBLE ASSETS - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Amortization expense of intangible assets | $ 3.4 | $ 3.4 | $ 10.2 | $ 10.5 | |
Finite-lived intangible asset, expected amortization, remainder of 2022 | 13.1 | 13.1 | |||
Finite-lived intangible asset, expected amortization, 2023 | 13.1 | 13.1 | |||
Finite-lived intangible asset, expected amortization, 2024 | 13.1 | 13.1 | |||
Finite-lived intangible asset, expected amortization, 2025 | $ 13.1 | $ 13.1 | |||
Intangible assets, estimated weighted average useful life | 13 years 8 months 12 days | 13 years 8 months 12 days |
OTHER ACCRUED LIABILITIES (Deta
OTHER ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Legal and professional accruals | $ 47,475 | $ 46,762 |
Payroll and other compensation expenses | 50,101 | 44,284 |
Insurance accruals | 6,820 | 7,314 |
Property, sales and other non-income related taxes | 6,701 | 8,018 |
Accrued commission | 1,481 | 1,111 |
Accrued interest | 8,070 | 6,469 |
Other | 8,991 | 7,141 |
Other accrued liabilities - discontinued operations | (13,162) | (9,363) |
Total | 129,639 | 121,099 |
Continuing Operations | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Total | $ 116,477 | $ 111,736 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Contingency [Line Items] | ||||
Provision for income taxes | $ 1.5 | $ 7.4 | $ 4.2 | $ 8.4 |
Effective tax rate (benefit) provision | 5.80% | 8.90% | 4.70% | 6.10% |
Valuation allowance related to net deferred tax assets | $ 0.8 | $ 0.8 | ||
Foreign Tax Authority | Germany and Canada Subsisdaries | ||||
Income Tax Contingency [Line Items] | ||||
Valuation allowance related to net deferred tax assets | $ 0.8 | $ 0.8 |
DEBT - Long-Term Debt Balances
DEBT - Long-Term Debt Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Total debt and finance lease obligations | $ 511,224 | $ 405,851 |
Finance lease obligations | 5,708 | 5,640 |
Current portion of long-term debt and finance lease obligations | (506,414) | (667) |
Long-Term Debt and Lease Obligation | 4,810 | 405,184 |
Secured Debt | ||
Debt Instrument [Line Items] | ||
Total debt and finance lease obligations | 410,391 | 312,549 |
Secured Debt | Atlantic Park Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt and finance lease obligations | 234,443 | 214,191 |
Subordinated Debt | Corre Term Loan | ||
Debt Instrument [Line Items] | ||
Total debt and finance lease obligations | 46,132 | 36,358 |
Convertible debt | ||
Debt Instrument [Line Items] | ||
Total debt and finance lease obligations | 95,125 | 87,662 |
Revolving Credit Facility | ABL Facility | ||
Debt Instrument [Line Items] | ||
Total debt and finance lease obligations | $ 129,816 | $ 62,000 |
DEBT - ABL Facilities, Addition
DEBT - ABL Facilities, Additional Information (Details) - USD ($) | 9 Months Ended | ||||||||||||||
Nov. 01, 2022 | Oct. 31, 2022 | May 06, 2022 | May 05, 2022 | Sep. 30, 2022 | Nov. 04, 2022 | Oct. 04, 2022 | Jun. 27, 2022 | Feb. 11, 2022 | Dec. 31, 2021 | Nov. 09, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 18, 2020 | Jul. 31, 2017 | |
Debt Instrument [Line Items] | |||||||||||||||
Borrowing capacity | $ 11,900,000 | ||||||||||||||
Debt issuance costs, net | 39,400,000 | $ 58,000,000 | |||||||||||||
Cash and cash equivalents | 55,200,000 | 55,200,000 | |||||||||||||
Outstanding letter of credit | 300,000 | ||||||||||||||
Foreign Financial Institutions | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Restricted cash | 2,400,000 | ||||||||||||||
Cash | $ 14,200,000 | ||||||||||||||
Subsequent Event | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Available borrowing capacity | $ 13,700,000 | ||||||||||||||
Surety Bond | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Outstanding letter of credit | 1,600,000 | ||||||||||||||
Miscellaneous Cash Deposit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Outstanding letter of credit | $ 900,000 | ||||||||||||||
ABL Eclipse | Base Rate | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Effective interest rate | 7.21% | ||||||||||||||
ABL Corre DDTL | LIBOR | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Effective interest rate | 12.56% | ||||||||||||||
ABL Facility | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt issuance costs, net | $ 8,300,000 | ||||||||||||||
Available borrowing capacity | 1,900,000 | ||||||||||||||
Restricted cash | 1,600,000 | ||||||||||||||
Cash | 12,900,000 | ||||||||||||||
ABL Facility | Unrestricted Cash and Cash Equivalents | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Credit facilities, collateral | 30,700,000 | ||||||||||||||
ABL Facility | Restricted Cash | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Credit facilities, collateral | $ 25,700,000 | ||||||||||||||
Atlantic Park Term Loan | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | $ 10,000,000 | $ 250,000,000 | |||||||||||||
Effective interest rate | 25.72% | 20.90% | |||||||||||||
Outstanding principle, days prior to maturity | 120 days | 75 days | |||||||||||||
Restricted cash | $ 4,100,000 | ||||||||||||||
Line of Credit | ABL Facility | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Debt issuance costs, net | $ 4,800,000 | $ 2,900,000 | |||||||||||||
Secured Debt | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | $ 55,000,000 | ||||||||||||||
Secured Debt | Delayed Draw Term Loan | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | 35,000,000 | ||||||||||||||
Secured Debt | ABL Corre DDTL | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Borrowing under credit facility | 35,000,000 | ||||||||||||||
Convertible debt | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | $ 97,400,000 | $ 97,400,000 | |||||||||||||
Effective interest rate | 10.28% | 9.12% | |||||||||||||
Debt Instrument, interest rate, stated percentage | 5% | ||||||||||||||
Periodic payment | $ 10,000,000 | ||||||||||||||
Fair value of our convertible senior notes | 10,000,000 | ||||||||||||||
Convertible debt | Subsequent Event | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | $ 41,200,000 | ||||||||||||||
Subordinated Debt | Delayed Draw Term Loan | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | $ 10,000,000 | 10,000,000 | |||||||||||||
Subordinated Debt | Delayed Draw Term Loan | Subsequent Event | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | 10,000,000 | ||||||||||||||
Subordinated Debt | Subordinated Term Loan | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Borrowing capacity | $ 10,000,000 | ||||||||||||||
Principal amount, long-term debt issued | $ 50,000,000 | ||||||||||||||
Effective interest rate | 46.79% | 19.73% | |||||||||||||
Debt Instrument, interest rate, stated percentage | 12% | 12% | |||||||||||||
Subordinated Debt | Subordinated Term Loan | Subsequent Event | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Principal amount, long-term debt issued | $ 112,700,000 | ||||||||||||||
Revolving Credit Facility | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Borrowing capacity | 130,000,000 | ||||||||||||||
Revolving Credit Facility | Line of Credit | ABL Eclipse | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Borrowing under credit facility | $ 94,800,000 | ||||||||||||||
Bridge Loan | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Borrowing capacity | 35,000,000 | ||||||||||||||
Letter of Credit | Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Borrowing capacity | $ 26,000,000 | ||||||||||||||
Letter of Credit | Line of Credit | ABL Facility | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Borrowing under credit facility | 8,900,000 | ||||||||||||||
Available borrowing capacity | $ 1,900,000 | ||||||||||||||
Outstanding principle, days prior to maturity | 120 days | 75 days | |||||||||||||
Letter of Credit | Line of Credit | ABL Facility | Subsequent Event | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Outstanding principle, days prior to maturity | 75 days | 45 days |
DEBT - Atlantic Park Term Loan,
DEBT - Atlantic Park Term Loan, Additional Information (Details) | Nov. 01, 2022 USD ($) | May 06, 2022 USD ($) | May 05, 2022 | Dec. 18, 2020 USD ($) | Dec. 18, 2026 USD ($) | Nov. 04, 2022 | Sep. 30, 2022 USD ($) | May 10, 2022 | Feb. 11, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Quest Integrity | Subsequent Event | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Proceeds from divestiture of businesses | $ 270,000,000 | |||||||||
Atlantic Park Term Loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Principal amount, long-term debt issued | $ 10,000,000 | $ 250,000,000 | ||||||||
Debt instrument, interest rate, original issue discount | 0.03 | |||||||||
Proceeds from issuance of debt | $ 242,500,000 | |||||||||
Line of credit facility, increase limit | $ 100,000,000 | |||||||||
Effective interest rate | 25.72% | 20.90% | ||||||||
Unamortized discount and issuance costs | $ 23,400,000 | $ 35,800,000 | ||||||||
Covenant, leverage ratio, maximum | 12 | 7 | ||||||||
Maximum unfinanced capital expenditures | $ 20,000,000 | |||||||||
Maximum net leverage ratio threshold | 4 | |||||||||
Outstanding principle, days prior to maturity | 120 days | 75 days | ||||||||
Atlantic Park Term Loan | Variable Interest Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Effective interest rate | 10.24% | 12.40% | ||||||||
Atlantic Park Term Loan | Accelerated Debt Issue Costs | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Effective interest rate | 15.48% | 8.50% | ||||||||
Atlantic Park Term Loan | Subsequent Event | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Covenant, leverage ratio, maximum | 7 | |||||||||
Atlantic Park Term Loan | Quest Integrity | Subsequent Event | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Proceeds from divestiture of businesses | 26,000,000 | |||||||||
Minimum outstanding balance affecting maturity trigger date | $ 10,000,000 | |||||||||
Atlantic Park Term Loan | Forecasted | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Principal amount, long-term debt issued | $ 10,000,000 |
DEBT - Subordinated Term Loan (
DEBT - Subordinated Term Loan (Details) | Nov. 01, 2022 USD ($) | Oct. 04, 2022 USD ($) | Sep. 30, 2022 USD ($) | Jun. 27, 2022 USD ($) | May 09, 2022 | Feb. 11, 2022 USD ($) | Dec. 31, 2021 USD ($) | Nov. 09, 2021 USD ($) |
Subsequent Event | Quest Integrity | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from divestiture of businesses | $ 270,000,000 | |||||||
Subordinated Term Loan | Subsequent Event | Quest Integrity | ||||||||
Debt Instrument [Line Items] | ||||||||
Proceeds from divestiture of businesses | $ 26,000,000 | |||||||
Subordinated Term Loan | Subordinated Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount, long-term debt issued | $ 50,000,000 | |||||||
Debt Instrument, interest rate, stated percentage | 12% | 12% | ||||||
Effective interest rate | 46.79% | 19.73% | ||||||
Unamortized debt issuance costs | $ 9,000,000 | $ 13,900,000 | ||||||
Subordinated Term Loan | Subordinated Debt | Accelerated Debt Issue Costs | ||||||||
Debt Instrument [Line Items] | ||||||||
Effective interest rate | 34.79% | 7.73% | ||||||
Subordinated Term Loan | Subordinated Debt | Subsequent Event | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount, long-term debt issued | $ 112,700,000 | |||||||
PIK Securities | Subordinated Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, interest rate, stated percentage | 12% | |||||||
Delayed Draw Term Loan | Subordinated Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount, long-term debt issued | $ 10,000,000 | $ 10,000,000 | ||||||
Covenant, leverage ratio, maximum | 12 | 7 | ||||||
Delayed Draw Term Loan | Subordinated Debt | Subsequent Event | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount, long-term debt issued | $ 10,000,000 |
DEBT - Warrants and Subscriptio
DEBT - Warrants and Subscription Agreement (Details) | Feb. 11, 2022 USD ($) nominee $ / shares shares | Sep. 30, 2022 shares | Jun. 27, 2022 USD ($) | May 06, 2022 USD ($) | Nov. 09, 2021 $ / shares shares | Nov. 08, 2021 shares | Dec. 18, 2020 USD ($) $ / shares shares |
Debt Instrument [Line Items] | |||||||
Class of warrant or right, outstanding (in shares) | shares | 3,582,949 | ||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 7.75 | ||||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | shares | 0 | ||||||
Number of qualified nominees | nominee | 1 | ||||||
Secured Debt | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount, long-term debt issued | $ | $ 55,000,000 | ||||||
PIPE Shares | |||||||
Debt Instrument [Line Items] | |||||||
Consideration received from sale of stock | $ | $ 10,000,000 | ||||||
Shares issued (in shares) | shares | 11,904,762 | ||||||
Price per share (in dollars per share) | $ / shares | $ 0.84 | ||||||
Period to appoint director | 7 days | ||||||
Atlantic Park Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount, long-term debt issued | $ | $ 10,000,000 | $ 250,000,000 | |||||
Delayed Draw Term Loan | Secured Debt | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount, long-term debt issued | $ | $ 35,000,000 | ||||||
Delayed Draw Term Loan | Subordinated Debt | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount, long-term debt issued | $ | $ 10,000,000 | $ 10,000,000 | |||||
A&R Warrant | Atlantic Park Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 1.50 | ||||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | shares | 4,082,949 | ||||||
APSC Warrant | Atlantic Park Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | shares | 500,000 | 1,417,051 |
DEBT - Convertible Notes, Addit
DEBT - Convertible Notes, Additional Information (Details) - Convertible debt - USD ($) | Oct. 04, 2022 | Sep. 30, 2022 | Jan. 13, 2022 | Dec. 31, 2020 | Jul. 31, 2017 |
Debt Instrument [Line Items] | |||||
Repurchased face amount | $ 136,900,000 | ||||
Principal amount, long-term debt issued | $ 97,400,000 | $ 97,400,000 | |||
Debt Instrument, interest rate, stated percentage | 5% | ||||
Subsequent Event | |||||
Debt Instrument [Line Items] | |||||
Principal amount, long-term debt issued | $ 41,200,000 | ||||
PIK Securities | |||||
Debt Instrument [Line Items] | |||||
Principal amount, long-term debt issued | $ 52,000,000 | ||||
PIK Securities | Interest paid in cash | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, interest rate, stated percentage | 5% | ||||
PIK Securities | PIK interest | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, interest rate, stated percentage | 8% | ||||
PIK Securities | Subsequent Event | |||||
Debt Instrument [Line Items] | |||||
Principal amount, long-term debt issued | $ 41,200,000 | ||||
Debt Instrument, interest rate, stated percentage | 5% | ||||
Debt conversion, principle amount | $ 57,000,000 | ||||
PIK Securities | Subsequent Event | Interest paid in cash | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, interest rate, stated percentage | 5% | ||||
PIK Securities | Subsequent Event | PIK interest | |||||
Debt Instrument [Line Items] | |||||
Debt Instrument, interest rate, stated percentage | 8% |
DEBT - Detail of Convertible De
DEBT - Detail of Convertible Debt Carrying Amount (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Convertible debt embedded derivative | ASU 2020-06 (ASC 470-20) | ||
Debt Instrument [Line Items] | ||
Carrying amount of the equity component, net of issuance costs | $ 0 | $ 7,969 |
Convertible debt embedded derivative | Accounting Standards Update 2017-12 | ||
Debt Instrument [Line Items] | ||
Carrying amount of the equity component, net of issuance costs | 37,276 | 37,276 |
Convertible debt | ||
Debt Instrument [Line Items] | ||
Principal | 97,372 | 93,130 |
Unamortized issuance costs | (1,378) | (916) |
Unamortized discount | (869) | (4,552) |
Net carrying amount of the liability component | $ 95,125 | $ 87,662 |
DEBT - Components of Convertibl
DEBT - Components of Convertible Debt Interest Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Debt Instrument [Line Items] | |||||
Amortization of debt discount and issuance costs | [1] | $ 25,666 | $ 6,388 | ||
Convertible debt | |||||
Debt Instrument [Line Items] | |||||
Coupon interest | $ 1,624 | $ 1,164 | 4,801 | 3,492 | |
Amortization of debt discount and issuance costs | 785 | 791 | 2,105 | 2,326 | |
Total interest expense | $ 2,409 | $ 1,955 | $ 6,906 | $ 5,818 | |
Effective interest rate | 10.28% | 9.12% | 10.28% | 9.12% | |
Convertible debt | PIK Securities | |||||
Debt Instrument [Line Items] | |||||
Coupon interest | $ 1,100 | $ 0 | $ 3,300 | $ 0 | |
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
DEBT - Cumulative Effect (Detai
DEBT - Cumulative Effect (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | Mar. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | |
Liabilities | |||||||||||
Long-term debt and finance lease obligations | $ 407,018 | $ 405,191 | |||||||||
Equity: | |||||||||||
Additional paid-in capital | $ 445,839 | $ 445,839 | 439,173 | 444,824 | |||||||
Adjustment to stockholders' equity | (28,730) | $ 75,437 | (28,730) | $ 75,437 | $ 549 | $ 27,070 | 51,867 | $ 167,905 | $ 182,860 | $ 214,603 | |
Retained Earnings (Accumulated Deficit) | $ (448,647) | $ (448,647) | $ (371,760) | (375,584) | |||||||
Basic (in dollars per share) | $ (0.53) | $ (2.94) | $ (1.86) | $ (4.62) | |||||||
Diluted (in dollars per share) | $ (0.53) | $ (2.94) | $ (1.86) | $ (4.62) | |||||||
Additional Paid-in Capital | |||||||||||
Equity: | |||||||||||
Adjustment to stockholders' equity | $ 445,839 | $ 428,031 | $ 445,839 | $ 428,031 | 445,210 | 444,747 | 444,824 | 426,924 | 424,812 | 422,589 | |
Retained Earnings (Deficit) | |||||||||||
Equity: | |||||||||||
Adjustment to stockholders' equity | $ (448,647) | $ (332,531) | (448,647) | $ (332,531) | $ (425,774) | $ (404,222) | (375,584) | $ (241,349) | $ (223,856) | $ (189,565) | |
Cumulative Effect, Period of Adoption, Adjustment | |||||||||||
Liabilities | |||||||||||
Long-term debt and finance lease obligations | 1,827 | ||||||||||
Equity: | |||||||||||
Adjustment to stockholders' equity | (1,827) | ||||||||||
Interest expense | $ 800 | ||||||||||
Basic (in dollars per share) | $ (0.01) | ||||||||||
Diluted (in dollars per share) | $ (0.01) | ||||||||||
Cumulative Effect, Period of Adoption, Adjustment | Additional Paid-in Capital | |||||||||||
Equity: | |||||||||||
Adjustment to stockholders' equity | (5,651) | ||||||||||
Cumulative Effect, Period of Adoption, Adjustment | Retained Earnings (Deficit) | |||||||||||
Equity: | |||||||||||
Adjustment to stockholders' equity | $ 3,824 |
DEBT - 1970 Group Substitute In
DEBT - 1970 Group Substitute Insurance Reimbursement Facility (Details) - USD ($) $ in Thousands | 9 Months Ended | ||||
Sep. 29, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | ||
Debt Instrument [Line Items] | |||||
Borrowing capacity | $ 11,900 | ||||
Payments of debt issuance costs | [1] | 13,609 | $ 2,899 | ||
Debt issuance costs, net | $ 39,400 | $ 58,000 | |||
Letter of Credit | 1970 Group Substitute Insurance Reimbursement Facility | |||||
Debt Instrument [Line Items] | |||||
Borrowing capacity | $ 21,400 | ||||
Increase (decrease) in credit facility liquidity | 21,300 | ||||
Cash released from restrictions | 16,300 | ||||
Restricted cash | 25,700 | ||||
Increase (decrease) in credit facility | 5,000 | ||||
Payments of debt issuance costs | 2,900 | ||||
Debt issuance costs, net | $ 2,900 | ||||
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
DEBT - Deferred Financing Costs
DEBT - Deferred Financing Costs, Debt and Warrant Discounts and Debt Issuance Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |||
Debt issuance costs, net | $ 39.4 | $ 39.4 | $ 58 |
Debt issuance costs expense | $ 10.6 | $ 15.2 |
DEBT - Subsequent Events (Detai
DEBT - Subsequent Events (Details) - USD ($) $ in Thousands | Nov. 01, 2022 | Nov. 04, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||||||
Cash and cash equivalents | [1] | $ 67,028 | $ 65,315 | $ 16,972 | $ 24,586 | ||
Subsequent Event | |||||||
Debt Instrument [Line Items] | |||||||
Repayments of debt | $ 238,000 | ||||||
Cash and cash equivalents | $ 76,000 | ||||||
Restricted Cash and Cash Equivalents | 6,800 | ||||||
Available borrowing capacity | 13,700 | ||||||
Total liquidity | $ 82,900 | ||||||
Quest Integrity | Subsequent Event | |||||||
Debt Instrument [Line Items] | |||||||
Purchase and sale agreement, consideration | 279,000 | ||||||
Proceeds from divestiture of businesses | $ 270,000 | ||||||
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
LEASES - Additional Information
LEASES - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2022 | |
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 | 14 years |
LEASES - Components of Lease Ex
LEASES - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease costs | $ 6,035 | $ 6,784 | $ 19,056 | $ 21,044 |
Variable lease costs | 1,057 | 1,503 | 3,958 | 4,106 |
Finance lease costs: | ||||
Amortization of right-of-use assets | 237 | 155 | 498 | 467 |
Interest on lease liabilities | 143 | 84 | 269 | 252 |
Lease cost - discontinued operations | 126 | (472) | (785) | (1,169) |
Total lease cost | 7,472 | 8,526 | 23,781 | 25,869 |
Continuing Operations | ||||
Finance lease costs: | ||||
Total lease cost | $ 7,598 | $ 8,054 | $ 22,996 | $ 24,700 |
LEASES - Cash Flow Lease Inform
LEASES - Cash Flow Lease Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Cash paid for amounts included in the measurement of lease liabilities | ||||
Operating cash flows from operating leases | $ 4,934 | $ 6,226 | $ 15,434 | $ 17,569 |
Operating cash flows from finance leases | 89 | 81 | 204 | 252 |
Financing cash flows from finance leases | 295 | 119 | 615 | 356 |
Right-of-use assets obtained in exchange for lease obligations | ||||
Operating leases | $ 1,343 | $ 721 | $ 2,697 | $ 9,304 |
LEASES - Amounts Recognized in
LEASES - Amounts Recognized in the Balance Sheet for Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Weighted average remaining lease term: | ||
Operating leases | 5 years 9 months 18 days | 6 years |
Finance leases | 9 years 1 month 6 days | 10 years |
Weighted average discount rate: | ||
Operating leases | 7.10% | 6.80% |
Finance leases | 7% | 6.40% |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Current portion of long-term debt and finance lease obligations | Current portion of long-term debt and finance lease obligations |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-Term Debt and Lease Obligation | Long-Term Debt and Lease Obligation |
Continuing Operations | ||
Operating Leases: | ||
Operating lease right-of-use assets | $ 48,189 | $ 58,495 |
Current portion of operating lease obligations | 13,328 | 15,412 |
Operating lease obligations (non-current) | 39,144 | 47,617 |
Finance Leases: | ||
Finance lease right-of-use assets | 4,909 | 5,114 |
Current portion of finance lease obligations | 898 | 667 |
Long-term finance lease obligations | 4,810 | 4,973 |
Discontinued Operations | ||
Operating Leases: | ||
Operating lease right-of-use assets | 1,872 | 2,205 |
Current portion of operating lease obligations | 812 | 764 |
Operating lease obligations (non-current) | 1,000 | 1,604 |
Finance Leases: | ||
Finance lease right-of-use assets | 6 | 9 |
Current portion of finance lease obligations | 2 | 2 |
Long-term finance lease obligations | $ 4 | $ 7 |
LEASES - Operating and Finance
LEASES - Operating and Finance Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Operating Leases | ||
2022 (Remainder of the year) | $ 5,774 | |
2023 | 15,146 | |
2024 | 12,058 | |
2025 | 8,711 | |
2026 | 6,654 | |
Thereafter | 17,553 | |
Total future minimum lease payments | 65,896 | |
Less: Interest | 13,424 | |
Present value of lease liabilities | 52,472 | |
Finance Leases | ||
2022 (Remainder of the year) | 424 | |
2023 | 1,197 | |
2024 | 954 | |
2025 | 667 | |
2026 | 608 | |
Thereafter | 3,925 | |
Total future minimum lease payments | 7,775 | |
Less: Interest | 2,067 | |
Present value of lease liabilities | $ 5,708 | $ 5,640 |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Mar. 15, 2021 | May 31, 2021 shares | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) factor $ / shares shares | Sep. 30, 2021 USD ($) shares | Dec. 31, 2021 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Awards outstanding to officers, directors and key employees (in shares) | 1,200,000 | 1,200,000 | |||||
Share-based compensation | $ | $ 600,000 | $ 1,100,000 | $ 600,000 | $ 5,600,000 | |||
Unrecognized compensation expense related to share-based compensation | $ | $ 2,200,000 | $ 2,200,000 | |||||
Remaining weighted-average period (in years) | 1 year 3 months 18 days | ||||||
Granted stock options (in shares) | 0 | 0 | |||||
Exercised stock options (in shares) | 0 | ||||||
Expired of stock options (in shares) | 7,210 | ||||||
Cancelled stock options (in shares) | 434 | ||||||
Expired as vested (in shares) | 6,776 | ||||||
Exercisable at end of year (in shares) | 10,000 | 10,000 | |||||
Weighted-average remaining contractual life of options exercisable (in years) | 9 months 18 days | ||||||
Range of weighted-average exercise prices, lower limit (in dollars per share) | $ / shares | $ 35.59 | ||||||
Stock and stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation | $ | $ 1,800,000 | $ 3,600,000 | |||||
Stock and stock units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period (in years) | 3 years | ||||||
Stock and stock units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period (in years) | 4 years | ||||||
Long-term performance stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation | $ | $ 1,200,000 | $ 1,900,000 | |||||
Award vesting period (in years) | 2 years | ||||||
Performance period (in years) | 2 years | ||||||
Share-based compensation award, number of performance conditions | factor | 2 | ||||||
Long-term performance stock units | 2019 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vested award performance target level, percentage | 25% | ||||||
Award vesting rights, performance metric, percentage | 0% | ||||||
Long-term performance stock units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Possible payouts | 0% | ||||||
Long-term performance stock units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Possible payouts | 200% | ||||||
Stock Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation | $ | $ 0 | $ 0 | |||||
Award vesting period (in years) | 4 years | ||||||
Award contractual term (in years) | 10 years | ||||||
2018 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of additional shares authorized (in shares) | 3,000,000 |
SHARE-BASED COMPENSATION - Stoc
SHARE-BASED COMPENSATION - Stock Units and Director Stock Grants (Details) - Stock and stock units shares in Thousands | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
No. of Stock Units | |
Stock and stock units, beginning of period (in shares) | shares | 804 |
Changes during the period: | |
Granted (in shares) | shares | 525 |
Vested and settled (in shares) | shares | (135) |
Forfeited and cancelled (in shares) | shares | (101) |
Stock and stock units, end of period (in shares) | shares | 1,093 |
Weighted Average Fair Value | |
Stock and stock units, beginning of period (in dollars per share) | $ / shares | $ 7.27 |
Changes during the period: | |
Granted (in dollars per share) | $ / shares | 1.30 |
Vested and settled (in dollars per share) | $ / shares | 7.16 |
Forfeited and cancelled (in dollars per share) | $ / shares | 6.95 |
Stock and stock units, end of period (in dollars per share) | $ / shares | $ 4.44 |
SHARE-BASED COMPENSATION - Perf
SHARE-BASED COMPENSATION - Performance Awards (Details) - Long-term performance stock units shares in Thousands | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Performance Units Subject to Market Conditions | |
No. of Units/Awards | |
Stock and stock units, beginning of period (in shares) | shares | 684 |
Changes during the period: | |
Granted (in shares) | shares | 0 |
Vested and settled (in shares) | shares | 0 |
Forfeited and cancelled (in shares) | shares | (653) |
Stock and stock units, end of period (in shares) | shares | 31 |
Weighted Average Fair Value | |
Stock and stock units, beginning of period (in dollars per share) | $ / shares | $ 6.45 |
Changes during the period: | |
Granted (in dollars per share) | $ / shares | 0 |
Vested and settled (in dollars per share) | $ / shares | 0 |
Forfeited and cancelled (in dollars per share) | $ / shares | 6.04 |
Stock and stock units, end of period (in dollars per share) | $ / shares | $ 14.96 |
Performance Units Not Subject to Market Conditions | |
No. of Units/Awards | |
Stock and stock units, beginning of period (in shares) | shares | 219 |
Changes during the period: | |
Granted (in shares) | shares | 0 |
Vested and settled (in shares) | shares | 0 |
Forfeited and cancelled (in shares) | shares | (188) |
Stock and stock units, end of period (in shares) | shares | 31 |
Weighted Average Fair Value | |
Stock and stock units, beginning of period (in dollars per share) | $ / shares | $ 9.91 |
Changes during the period: | |
Granted (in dollars per share) | $ / shares | 0 |
Vested and settled (in dollars per share) | $ / shares | 0 |
Forfeited and cancelled (in dollars per share) | $ / shares | 9.61 |
Stock and stock units, end of period (in dollars per share) | $ / shares | $ 11.69 |
EMPLOYEE BENEFIT PLANS - Schedu
EMPLOYEE BENEFIT PLANS - Schedule of Net Pension Cost (Credit) (Details) - Pension Plan - United Kingdom - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Interest cost | $ 358 | $ 322 | $ 1,171 | $ 970 |
Expected return on plan assets | (533) | (504) | (1,744) | (1,515) |
Amortization of prior service cost | 7 | 9 | 23 | 26 |
Net periodic pension credit | $ (168) | $ (173) | $ (550) | $ (519) |
EMPLOYEE BENEFIT PLANS - Additi
EMPLOYEE BENEFIT PLANS - Additional Information (Details) - Pension Plan - United Kingdom $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted-average of expected returns on asset investment, percentage | 2.10% |
Expected contributions for current year | $ 3.9 |
Total contributions to date | $ 2.7 |
Defined Benefit Plan, Equity Securities | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted-average of expected returns on asset investment, percentage | 4.60% |
Debt Securities | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted-average of expected returns on asset investment, percentage | 1.40% |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE LOSS - Summary of Changes in AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | $ 51,867 | |||
Other comprehensive loss | $ (7,035) | $ (3,084) | (12,152) | $ (2,210) |
Tax Provision | 0 | 691 | 0 | 536 |
Other comprehensive income (loss), net of tax | (7,035) | (2,393) | (12,152) | (1,674) |
Balance, end of period | (28,730) | (28,730) | ||
Total | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (26,732) | (27,678) | ||
Balance, end of period | (38,884) | (29,352) | (38,884) | (29,352) |
Foreign Currency Translation Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (23,287) | (23,045) | ||
Other comprehensive loss | (12,152) | (2,210) | ||
Tax Provision | 0 | 536 | ||
Balance, end of period | (35,439) | (25,255) | (35,439) | (25,255) |
Foreign Currency Hedge | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | 0 | 2,988 | ||
Other comprehensive loss | 0 | 0 | ||
Balance, end of period | 0 | 2,988 | 0 | 2,988 |
Defined Benefit Pension Plans | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (3,277) | (8,021) | ||
Other comprehensive loss | 0 | 0 | ||
Balance, end of period | (3,277) | (8,021) | (3,277) | (8,021) |
Tax Provision | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance, beginning of period | (169) | 400 | ||
Tax Provision | 0 | 536 | ||
Balance, end of period | $ (169) | $ 936 | $ (169) | $ 936 |
ACCUMULATED OTHER COMPREHENSI_4
ACCUMULATED OTHER COMPREHENSIVE LOSS - Related Tax Effects of AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Accumulated Other Comprehensive Loss [Line Items] | ||||
Gross Amount | $ (7,035) | $ (3,084) | $ (12,152) | $ (2,210) |
Tax provision attributable to other comprehensive loss | $ 0 | $ 691 | 0 | 536 |
Other comprehensive loss, net of tax | (12,152) | (1,674) | ||
Foreign currency translation adjustments | ||||
Accumulated Other Comprehensive Loss [Line Items] | ||||
Gross Amount | (12,152) | (2,210) | ||
Tax provision attributable to other comprehensive loss | 0 | 536 | ||
Other comprehensive loss, net of tax | $ (12,152) | $ (1,674) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 14 Months Ended | ||||
Feb. 09, 2022 USD ($) | Jun. 01, 2021 USD ($) | Aug. 26, 2020 claim | Sep. 30, 2022 USD ($) | Apr. 20, 2021 facility | |
Loss Contingencies [Line Items] | |||||
Number of facilities with potential violations | facility | 7 | ||||
Self-insured retention and deductible | $ 3 | ||||
Legal and professional accruals | 44 | ||||
Amount not covered by insurance | 5 | ||||
EPA | |||||
Loss Contingencies [Line Items] | |||||
Cost incurred in dispute | $ 0.2 | ||||
Thai action | |||||
Loss Contingencies [Line Items] | |||||
New claims filed | claim | 2 | ||||
Kelli Most Litigation | |||||
Loss Contingencies [Line Items] | |||||
Amount awarded to other party | $ 222 | ||||
Kelli Most Litigation | Minimum | |||||
Loss Contingencies [Line Items] | |||||
Estimate of possible loss | 13 | ||||
Kelli Most Litigation | Maximum | |||||
Loss Contingencies [Line Items] | |||||
Estimate of possible loss | $ 51 |
SEGMENT AND GEOGRAPHIC DISCLO_3
SEGMENT AND GEOGRAPHIC DISCLOSURES - Additional Information (Details) - segment | 9 Months Ended | 12 Months Ended | ||
Aug. 15, 2022 | Aug. 14, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Segment Reporting [Abstract] | ||||
Number of operating segments | 2 | 2 | 2 | 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, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 247,780 | $ 217,410 | $ 717,621 | $ 650,901 | |
Depreciation and amortization | [1] | 28,591 | 31,416 | ||
Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 218,339 | 197,879 | 628,917 | 591,043 | |
Operating income (loss) | (1,729) | (72,228) | (34,929) | (107,972) | |
Capital expenditures | 4,258 | 2,488 | 14,846 | 10,599 | |
Depreciation and amortization | 8,987 | 9,516 | 27,449 | 29,400 | |
IHT | Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 110,312 | 101,476 | 320,033 | 310,077 | |
MS | Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 108,027 | 96,403 | 308,884 | 280,966 | |
Operating segments | IHT | Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 110,312 | 101,476 | 320,033 | 310,077 | |
Operating income (loss) | 7,390 | 3,065 | 13,038 | 10,824 | |
Capital expenditures | 2,557 | 1,454 | 10,654 | 6,625 | |
Depreciation and amortization | 3,022 | 3,148 | 9,372 | 9,888 | |
Operating segments | MS | Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 108,027 | 96,403 | 308,884 | 280,966 | |
Operating income (loss) | 7,655 | (53,242) | 15,152 | (50,799) | |
Capital expenditures | 1,427 | 741 | 3,861 | 3,260 | |
Depreciation and amortization | 4,704 | 4,950 | 14,222 | 15,432 | |
Corporate and shared support services | Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Operating income (loss) | (16,774) | (22,051) | (63,119) | (67,997) | |
Capital expenditures | 274 | 293 | 331 | 714 | |
Depreciation and amortization | $ 1,261 | $ 1,418 | $ 3,855 | $ 4,080 | |
[1]Condensed consolidated statements of cash flows include discontinued operations. September 30, 2022 September 30, 2021 Cash and cash equivalents from continuing operations $ 56,387 $ 12,009 Cash and cash equivalents from discontinued operations 10,641 4,963 Total $ 67,028 $ 16,972 |
SEGMENT AND GEOGRAPHIC DISCLO_5
SEGMENT AND GEOGRAPHIC DISCLOSURES - Geographic Breakdown of Revenues and Total Long-Lived Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenues from External Customers [Line Items] | ||||
Discontinued operations revenue | $ (29,441) | $ (19,531) | $ (88,704) | $ (59,858) |
Total Revenues | 247,780 | 217,410 | 717,621 | 650,901 |
Continuing Operations | ||||
Revenues from External Customers [Line Items] | ||||
Total Revenues | 218,339 | 197,879 | 628,917 | 591,043 |
United States | ||||
Revenues from External Customers [Line Items] | ||||
Total Revenues | 173,890 | 143,636 | 497,236 | 447,932 |
Canada | ||||
Revenues from External Customers [Line Items] | ||||
Total Revenues | 28,193 | 30,465 | 84,704 | 81,110 |
Europe | ||||
Revenues from External Customers [Line Items] | ||||
Total Revenues | 24,869 | 27,122 | 75,546 | 82,098 |
Other foreign countries | ||||
Revenues from External Customers [Line Items] | ||||
Total Revenues | $ 20,828 | $ 16,187 | $ 60,135 | $ 39,761 |
SEVERANCE AND OTHER CHARGES - A
SEVERANCE AND OTHER CHARGES - Additional Information (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Operating Group Reorganization Program | Employee Severance | |
Restructuring Cost and Reserve [Line Items] | |
Restructuring and other related charges, net | $ 3,028 |
SEVERANCE AND OTHER CHARGES - R
SEVERANCE AND OTHER CHARGES - Rollforward of Restructuring Liability - OneTEAM Program (Details) - Operating Group Reorganization Program - Employee Severance $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Balance, beginning of period | $ 712 |
Charges | 3,028 |
Payments | (1,952) |
Balance, end of period | $ 1,788 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Alvarez And Marsal | ||
Related Party Transaction [Line Items] | ||
Expenses from transactions with related party | $ 6.4 | $ 8 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Oct. 04, 2022 | Nov. 01, 2022 | Sep. 30, 2022 | Jan. 13, 2022 | Dec. 31, 2020 |
Convertible debt | |||||
Subsequent Event [Line Items] | |||||
Principal amount, long-term debt issued | $ 97,400,000 | $ 97,400,000 | |||
PIK Securities | Convertible debt | |||||
Subsequent Event [Line Items] | |||||
Principal amount, long-term debt issued | $ 52,000,000 | ||||
Subsequent Event | Quest Integrity | |||||
Subsequent Event [Line Items] | |||||
Purchase and sale agreement, consideration | $ 279,000,000 | ||||
Subsequent Event | TQ Acquisition, Inc | |||||
Subsequent Event [Line Items] | |||||
Purchase and sale agreement, consideration | $ 279,000,000 | ||||
Subsequent Event | Convertible debt | |||||
Subsequent Event [Line Items] | |||||
Principal amount, long-term debt issued | $ 41,200,000 | ||||
Subsequent Event | PIK Securities | Convertible debt | |||||
Subsequent Event [Line Items] | |||||
Debt conversion, principle amount | 57,000,000 | ||||
Principal amount, long-term debt issued | $ 41,200,000 |