Cover
Cover - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2022 | Mar. 10, 2023 | Jun. 30, 2022 | Jun. 28, 2019 | |
Document Information [Line Items] | ||||
Document Type | 10-K | |||
Document Annual Report | true | |||
Document Period End Date | Dec. 31, 2022 | |||
Current Fiscal Year End Date | --12-31 | |||
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 Well-known Seasoned Issuer | No | |||
Entity Voluntary Filers | No | |||
Entity Current Reporting Status | Yes | |||
Entity Interactive Data Current | Yes | |||
Entity Filer Category | Non-accelerated Filer | |||
Entity Small Business | true | |||
Entity Emerging Growth Company | false | |||
ICFR Auditor Attestation Flag | false | |||
Entity Shell Company | false | |||
Entity Public Float | $ 21 | $ 316 | ||
Entity Common Stock, Shares Outstanding | 4,342,963 | |||
Documents Incorporated by Reference | Portions of our Definitive Proxy Statement for the 2023 Annual Meeting of Stockholders are incorporated by reference into Part III of this report. | |||
Amendment Flag | false | |||
Document Fiscal Year Focus | 2022 | |||
Document Fiscal Period Focus | FY | |||
Entity Central Index Key | 0000318833 | |||
Common Stock | ||||
Document Information [Line Items] | ||||
Title of 12(b) Security | Common Stock, $0.30 par value | |||
Trading Symbol | TISI | |||
Security Exchange Name | NYSE | |||
Preferred Stock | ||||
Document Information [Line Items] | ||||
Title of 12(b) Security | Preferred Stock Purchase Rights | |||
Security Exchange Name | NYSE | |||
No trading symbol | true |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Firm ID | 185 |
Auditor Name | KPMG LLP |
Auditor Location | Houston, Texas |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 58,075 | $ 55,193 |
Accounts receivable, net of allowance of $5,262 and $7,843, respectively | 186,689 | 168,273 |
Inventory | 36,331 | 35,375 |
Income tax receivable | 779 | 4,289 |
Prepaid expenses and other current assets | 65,679 | 56,063 |
Current assets associated with discontinued operations | 0 | 83,096 |
Total current assets | 347,553 | 402,289 |
Property, plant and equipment, net | 138,099 | 145,480 |
Intangible assets, net | 75,407 | 88,318 |
Operating lease right-of-use assets | 48,462 | 58,495 |
Defined benefit pension asset | 398 | 2,902 |
Other assets, net | 6,351 | 8,387 |
Deferred tax asset | 375 | 673 |
Total assets | 616,645 | 706,544 |
Current liabilities: | ||
Current portion of long-term debt and finance lease obligations | 280,993 | 667 |
Current portion of operating lease obligations | 13,823 | 15,412 |
Accounts payable | 32,524 | 44,056 |
Other accrued liabilities | 119,267 | 111,736 |
Income tax payable | 2,257 | 0 |
Current liabilities associated with discontinued operations | 0 | 16,396 |
Total current liabilities | 448,864 | 188,267 |
Long-term debt and finance lease obligations | 4,942 | 405,184 |
Operating lease obligations | 38,819 | 47,617 |
Deferred tax liabilities | 3,661 | 3,812 |
Other long-term liabilities | 2,599 | 9,797 |
Total liabilities | 498,885 | 654,677 |
Commitments and contingencies | ||
Equity: | ||
Preferred stock, 500,000 shares authorized, none issued | 0 | 0 |
Common stock, par value $0.30 per share, 12,000,000 shares authorized; 4,342,909 and 3,121,471 shares issued | 1,303 | 936 |
Additional paid-in capital | 457,133 | 453,247 |
Accumulated deficit | (301,679) | (375,584) |
Accumulated other comprehensive loss | (38,997) | (26,732) |
Total equity | 117,760 | 51,867 |
Total liabilities and equity | $ 616,645 | $ 706,544 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for credit loss, current | $ 5,262 | $ 7,843 |
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) | 12,000,000 | 12,000,000 |
Common stock, shares issued (in shares) | 4,342,909 | 3,121,471 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | |||
Income Statement [Abstract] | ||||
Revenues | $ 840,208 | $ 794,197 | ||
Operating expenses | 638,597 | 616,501 | ||
Gross margin | 201,611 | 177,696 | ||
Selling, general and administrative expenses | 241,397 | 246,206 | ||
Restructuring and other related charges, net (see Note 19) | 16 | 2,535 | ||
Goodwill impairment charge (see Note 9) | 0 | 55,837 | ||
Operating loss | (39,802) | (126,882) | ||
Interest expense, net | (85,052) | (46,079) | ||
Loss on warrants | [1] | 0 | (59) | |
Loss on debt extinguishment | (30,083) | 0 | ||
Other income (expense), net | 8,156 | (3,052) | ||
Loss before income taxes | (146,781) | (176,072) | ||
Provision for income taxes (see Note 11) | (3,306) | (8,773) | ||
Net loss from continuing operations | (150,087) | (184,845) | ||
Discontinued operations: | ||||
Net income (loss) from discontinued operations, net of income tax | 220,166 | (1,174) | ||
Net income (loss) | $ 70,079 | $ (186,019) | [1] | |
Basic and diluted net income (loss) per common share: | ||||
Basic earnings (loss) from continuing operations per share (in USD per share) | $ (35.85) | $ (59.67) | ||
Loss from continuing operations, diluted (in USD per share) | (35.85) | (59.67) | ||
Income (loss) from discontinued operations, basic (in USD per share) | 52.58 | (0.38) | ||
Income (loss) from discontinued operations, basic (in USD per share) | 52.58 | (0.38) | ||
Basic (in USD per share) | 16.73 | (60.05) | ||
Diluted (in USD per share) | $ 16.73 | $ (60.05) | ||
Weighted-average number of shares outstanding: | ||||
Weighted-average number of basic shares outstanding (in shares) | 4,187 | 3,098 | ||
Weighted-average number of diluted shares outstanding (in shares) | 4,187 | 3,098 | ||
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 70,079 | $ (186,019) | [1] |
Other comprehensive income (loss) before tax: | |||
Foreign currency translation adjustment | (6,589) | (2,213) | |
Defined benefit pension plans: | |||
Net actuarial (loss) gain arising during period | (6,632) | 4,048 | |
Settlement cost during period | 0 | 67 | |
Amortization of prior service cost | 31 | 33 | |
Other comprehensive (loss) income, before tax | (13,190) | 1,935 | |
Tax benefit (provision) attributable to other comprehensive income (loss) | 925 | (989) | |
Other comprehensive (loss) income, net of tax | (12,265) | 946 | |
Total comprehensive income (loss) | $ 57,814 | $ (185,073) | |
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Loss | |
Beginning balance (in shares) at Dec. 31, 2020 | 30,874,000 | |||||
Beginning balance at Dec. 31, 2020 | $ 214,603 | $ 9,257 | $ 422,589 | $ (189,565) | $ (27,678) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (186,019) | [1] | (186,019) | |||
Foreign currency translation adjustment, net of tax | (2,214) | (2,214) | ||||
Defined benefit pension plans, net of tax | 3,160 | 3,160 | ||||
Non-cash compensation | 7,013 | 7,013 | ||||
Net settlement of vested stock awards (in shares) | 340,000 | |||||
Net settlement of vested stock awards | (240) | $ 102 | (342) | |||
Issuance of warrant, net | 15,564 | 15,564 | ||||
Reverse Stock Split Adjustment (in shares) | (28,092,000) | |||||
Effect of reverse stock split | 0 | $ (8,423) | 8,423 | |||
Ending balance (in shares) at Dec. 31, 2021 | 3,122,000 | |||||
Ending balance at Dec. 31, 2021 | 51,867 | $ 936 | 453,247 | (375,584) | (26,732) | |
Ending balance (Accounting Standards Update 2020-06) at Dec. 31, 2021 | (1,825) | (5,650) | 3,825 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 70,079 | 70,079 | ||||
Foreign currency translation adjustment, net of tax | (6,589) | (6,589) | ||||
Defined benefit pension plans, net of tax | (5,675) | (5,675) | ||||
Non-cash compensation | 247 | 247 | ||||
Net settlement of vested stock awards (in shares) | 1,221,000 | |||||
Net settlement of vested stock awards | $ 9,656 | $ 367 | 9,289 | |||
Ending balance (in shares) at Dec. 31, 2022 | 4,342,909 | 4,343,000 | ||||
Ending balance at Dec. 31, 2022 | $ 117,760 | $ 1,303 | $ 457,133 | $ (301,680) | $ (38,996) | |
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | |||
Cash flows from operating activities: | ||||
Net income (loss) | $ 70,079,000 | $ (186,019,000) | [1] | |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | [1] | 37,595,000 | 41,518,000 | |
Write-off of deferred loan costs | [1] | 2,748,000 | 0 | |
Gain on sale of Quest Integrity | [1] | (203,351,000) | 0 | |
Loss on debt extinguishment | [1] | 17,719,000 | 415,000 | |
Loss on warrants | [1] | 0 | 59,000 | |
Amortization of debt issuance costs and debt discounts | [1] | 35,509,000 | 13,784,000 | |
Paid-in-kind interest | [1] | 18,227,000 | 0 | |
Allowance for credit losses | [1] | 402,000 | 1,943,000 | |
Foreign currency loss | [1] | 1,698,000 | 5,674,000 | |
Deferred income taxes | [1] | 653,000 | 4,521,000 | |
Gain on asset disposal | [1] | (4,721,000) | (2,981,000) | |
Goodwill impairment charges | [1] | 0 | 64,632,000 | |
Non-cash compensation cost | [1] | 247,000 | 7,013,000 | |
Other, net | [1] | (4,569,000) | (4,844,000) | |
Changes in operating assets and liabilities: | ||||
Accounts receivable | [1] | (33,483,000) | 700,000 | |
Inventory | [1] | (1,655,000) | 528,000 | |
Prepaid expenses and other current assets | [1] | (3,201,000) | 4,190,000 | |
Accounts payable | [1] | (13,291,000) | 1,178,000 | |
Other accrued liabilities | [1] | 15,195,000 | 11,631,000 | |
Income taxes | [1] | 6,264,000 | 605,000 | |
Net cash used in operating activities | [1] | (57,935,000) | (35,453,000) | |
Cash flows from investing activities: | ||||
Capital expenditures | [1] | (24,690,000) | (17,605,000) | |
Net proceeds from sale of discontinued operations | [1] | 260,841,000 | 0 | |
Proceeds from disposal of assets | [1] | 7,205,000 | 3,528,000 | |
Net cash (used in) provided by investing activities | [1] | 243,356,000 | (14,077,000) | |
Cash flows from financing activities: | ||||
Borrowings under 2020 ABL Facility, gross | [1] | 10,300,000 | 128,000,000 | |
Payments under 2020 ABL Facility, gross | [1] | (72,300,000) | (137,000,000) | |
Borrowings under 2022 ABL Credit Facility, gross | [1] | 108,638,000 | 0 | |
Payments under 2022 ABL Credit Facility, gross | [1] | (43,722,000) | 0 | |
Borrowings under Corre Delayed Draw Term Loan, gross | [1] | 35,000,000 | 0 | |
Borrowings under Subordinated Term Loan, gross | [1] | 0 | 50,000,000 | |
Borrowings under 2020 ABL Credit Facility, net | [1] | 0 | 62,000,000 | |
Payments under APSC Term Loan, gross | [1] | (224,946,000) | 0 | |
Payments for debt issuance costs | [1] | (13,709,000) | (10,457,000) | |
Issuance of common stock, net of issuance costs | [1] | 9,639,000 | 0 | |
Taxes paid related to net share settlement of share-based awards | [1] | 16,000 | ||
Taxes paid related to net share settlement of share-based awards | [1] | (240,000) | ||
Other | [1] | (887,000) | (453,000) | |
Net cash (used in) provided by financing activities | [1] | (191,971,000) | 91,850,000 | |
Effect of exchange rate changes on cash | [1] | (690,000) | (1,591,000) | |
Net increase (decrease) in cash and cash equivalents | [1] | (7,240,000) | 40,729,000 | |
Cash and cash equivalents at beginning of period | [1] | 65,315,000 | 24,586,000 | |
Cash and cash equivalents at end of period | [1] | 58,075,000 | 65,315,000 | |
Cash paid (refunded) during the year for: | ||||
Interest | [1] | 29,187,000 | 28,176,000 | |
Income taxes | [1] | $ (553,000) | $ 5,829,000 | |
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash and cash equivalents | [1] | $ 58,075 | $ 65,315 |
Lease cost - continuing operations | |||
Cash and cash equivalents | 58,075 | 55,193 | |
Discontinued Operations | |||
Cash and cash equivalents | $ 0 | $ 10,122 | |
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES | 12 Months Ended |
Dec. 31, 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” and “us” are used in this report to refer to either Team, Inc., to one or more of our 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 as discussed below, we conducted operations in three segments: Inspection and Heat Treating, Mechanical Services 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 involving: 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 escalating with the client’s needs, as dictated by the severity of the damage found and the related operating conditions, from standard services to some of the most advanced services and integrated 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, to Baker Hughes Holdings LLC for an aggregate purchase price of approximately $279.0 million, after certain post-closing adjustments pursuant to that certain Equity Purchase Agreement by and among us and Baker Hughes, dated as of August 14, 2022. 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 by and liens on assets, as applicable, of TQ Acquisition and its subsidiaries in respect of our existing debt arrangements were released. We used approximately $238.0 million of the net proceeds from the Quest Integrity Transaction to pay down $225.0 million of our term loan 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. The criteria for reporting Quest Integrity as a discontinued operation were met as of completion of the Quest Integrity sale transaction and, as such, all periods presented in this Form 10-K have been recast to present Quest Integrity as a discontinued operation. Unless otherwise specified, the financial information and discussion in this Form 10-K 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, pipeline integrity management services, and field heat treating services, 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. 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. CARES Act. Under the Coronavirus Aid, Relief and Economic Security Act we qualified to defer the employer portion of social security taxes incurred through the end of calendar year 2020. We deferred total employer payroll taxes of $14.1 million. We paid $7.0 million of the deferred payroll taxes in January 2022 and transferred $0.5 million of such obligation as part of the Quest Integrity sale transaction to the buyer. The remaining amount of $6.6 million, outstanding as of December 31, 2022, was paid in January 2023. 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. We recognized $0.6 million and $0.1 million as a reduction to operating expenses and selling, general and administrative expenses, respectively, during the twelve months ended December 31, 2022. We recognized $6.2 million and $1.5 million as a reduction to operating expenses and selling, general and administrative expenses, respectively, during the twelve months ended December 31, 2021. We also deferred certain payroll related expenses and tax payments under other foreign government programs. We had $2.1 million and $3.2 million as of December 31, 2022 and 2021, respectively, related to these foreign deferrals. Reverse Stock Split . On November 2, 2022, the Company’s shareholders approved a proposal to authorize the Board to implement a reverse stock split of the outstanding shares of the Company’s common stock at a ratio of one-for-ten. The Board approved the Reverse Stock Split on December 9, 2022, which became effective on December 21, 2022. As of the effective date, every ten issued and outstanding shares of common stock was converted into one share of common stock, The common stock began trading on a reverse split-adjusted basis on the NYSE at the opening of trading on December 22, 2022. All issued and outstanding common stock and per share amounts contained in the financial statements have been retroactively adjusted to reflect this Reverse Stock Split for all periods presented. In addition, a proportionate adjustment was made to the per share exercise price and the number of shares issuable upon the exercise and/or vesting of all outstanding stock options, restricted stock units and warrants to purchase shares of common stock. A proportionate adjustment was also made to the number of shares reserved for issuance pursuant to the Company’s equity incentive compensation plans to reflect the Reverse Stock Split. Any fraction of a share of common stock that was created as a result of the Reverse Stock Split was rounded up to the next whole share. The common stock par value and additional paid-in-capital line items contained in the financial statements were adjusted to account for the Reverse Stock Split for all periods presented. Basis for presentation. These 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 consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of results for such periods. Consolidation. The 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 herein) 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 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 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 audited 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) projected 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, expected availability under our existing credit agreements 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 consolidated financial statements. Our Notes are due on August 1, 2023 and had a principal balance of $41.2 million as of December 31, 2022 following the exchanged 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. 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 2022 ABL Credit Agreement), and the Maturity Trigger Date (as defined in the Term Loan Credit Agreement) collectively referred to as the “Trigger Date” is June 17, 2023, see Note 12 - Debt for additional information. Therefore, the Notes balance must be paid down to less than $10.0 million by June 17, 2023. On October 4, 2022, we entered into Amendment No. 8 (“Corre Amendment 8”) to the Subordinated Term Loan Credit Agreement. On November 1, 2022, we completed the Quest Integrity Transaction with Baker Hughes, as discussed above, for an aggregate purchase price of approximately $279.0 million, after certain post-closing adjustments, in accordance with the Sale Agreement. On November 4, 2022, we entered into Amendment No. 9 (“Term Loan Amendment No. 9”) to the Term Loan Credit Agreement and Amendment No. 10 (“Corre Amendment 10”) to the Subordinated Term Loan Credit Agreement. Refer to Note 12 - Debt for more information on the terms, maturity dates and amendments to our debt that may affect our future liquidity. As of December 31, 2022, we are in compliance with our debt covenants. Without the execution of a refinancing transaction, an agreement to extend the Notes maturity date, and/or amendments to our existing debt agreements 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 the Notes when they become due on August 1, 2023. The failure to pay down the Notes to less than $10.0 million would (i) trigger the early maturity of our Term Loan Credit Agreement pursuant to the Trigger Date concept, and (ii) permit the administrative agent under the 2022 ABL Credit Agreement to implement a borrowing base reserve in an amount equal to the outstanding principal amount of the Notes on such date. A required repayment of the Term Loan Credit Agreement in accordance with the Trigger Date concept would in turn trigger a requirement to repay the Subordinated Term Loans pursuant to the Subordinated Term Loan Credit Agreement 14 days after repayment in full of the Term Loan Credit Agreement. There is no assurance that we would be able to make such payments, and failure to make such payments would result in events of default under the applicable credit facility and associated cross defaults under the Company’s other debt instruments. Failure to pay the Notes off at the maturity date on August 1, 2023 will result in an event of default under the Notes and the associated cross defaults noted above under the Company’s other debt instruments. Refer to Note 12 - Debt for more information on the terms and maturity dates of our debt that may affect our future liquidity. Our ability to maintain compliance with the financial covenants contained in the 2022 ABL Credit Agreement, the Term Loan Credit Agreement and the Subordinated Term Loan Credit Agreement is dependent upon our future operating performance and future financial condition, both of which are subject to various risks and uncertainties. The lingering effects of COVID-19, threat of recession and resulting economic repercussions could have a significant adverse effect on our financial position and business condition, as well as our clients and suppliers. Additionally, these events may, among other factors, impact our ability to generate cash flows from operations, access the capital markets on acceptable terms or at all, and affect our future need or ability to borrow under our 2022 ABL Credit Facility. In addition to our current sources of funding our business, the effects of such events may impact our liquidity or our need to revise our allocation or sources of capital, implement further cost reduction measures and/or change our business strategy. Political economic repercussions could have a broad range of effects on our liquidity sources and will depend on future developments and cannot be predicted at this time. As a result of our current liquidity condition and the potential inability to negotiate an extension or amend the financial covenants, substantial doubt about the Company’s ability to continue as a going concern is raised. 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. As such, substantial doubt exists about our ability to continue as a going concern. The 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 Generally Accepted Accounting Principles (“GAAP”) in the United States. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect our reported financial position and results of operations. We review significant estimates and judgments affecting our consolidated financial statements on a recurring basis and record the effect of any necessary adjustments prior to their publication. Estimates and judgments are based on information available at the time such estimates and judgments are made. Adjustments made with respect to the use of these estimates and judgments often relate to information not previously available. Uncertainties with respect to such estimates and judgments are inherent in the preparation of financial statements. Estimates and judgments are used in, among other things, (1) valuation of acquisition related tangible and intangible assets and assessments of all long-lived assets for possible impairment, (2) estimating various factors used to accrue liabilities for workers’ compensation, auto, medical and general liability, (3) establishing an allowance for uncollectible accounts receivable, (4) estimating the useful lives of our assets, (5) assessing future tax exposure and the realization of tax assets, (6) selecting assumptions used in the measurement of costs and liabilities associated with defined benefit pension plans, (7) assessments of fair value and (8) managing our foreign currency risk in foreign operations. Our most significant accounting policies are described below. Fair value of financial instruments . As defined in FASB 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 those that are unobservable and of a highly subjective measure. Our financial instruments consist primarily of cash, cash equivalents, accounts receivable, accounts payable, pension assets 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. For additional information regarding our pension assets, see Note 16 - Employee Benefit plan . The fair value of our 2022 ABL Credit Facility and Term Loans are 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 the Notes as of December 31, 2022 and 2021 was $37.5 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 2022 ABL Credit Facility, Term Loan, Subordinated Term Loan and Notes, see Note 12 - Debt . Cash and cash equivalents . Cash and cash equivalents consist of all demand 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 standard 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 value 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. 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. As of December 31, 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 part of discontinued operations. During the year ended December 31, 2021, our assessment of qualitative indicators associated with our interim and annual goodwill impairment tests indicated a potential impairment existed. The next step of goodwill assessment determined that an impairment existed as the carrying value of the MS segment exceeded its fair value. As a result, we recorded goodwill impairment of $55.8 million during the year ended December 31, 2021. We also recorded goodwill impairment of $8.8 million on our discontinued operations during the year ended December 31, 2021. There was no goodwill impairment recorded during or as of December 31, 2022. Impairment of Long-lived Assets. The Company reviews its property and equipment, intangible assets subject to amortization and other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset class may not be recoverable. Indicators of potential impairment include: an adverse change in legal factors or in the business climate that could affect the value of the asset; an adverse change in the extent or manner in which the asset is used or is expected to be used, or in its physical condition; and current or forecasted operating or cash flow losses that demonstrate continuing losses associated with the use of the asset. If indicators of impairment are present, the asset is tested for recoverability by comparing the carrying value of the asset to the related estimated undiscounted future cash flows expected to be derived from the asset. If the expected cash flows are less than the carrying value of the asset, then the asset is considered to be impaired and its carrying value is written down to fair value, based on the related estimated discounted cash flows. There were no impairment charges in 2022 or 2021. 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 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 we operate in. 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 is 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. As of December 31, 2022, our deferred tax assets were $94.7 million, less a valuation allowance of $73.5 million. As of December 31, 2022, our deferred tax liabilities were $24.5 million. 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. As of December 31, 2022, our gross unrecognized tax benefits, excluding penalties and interest related to uncertain tax positions, were $1.1 million. 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 mat |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended |
Dec. 31, 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 $279.0 million, after certain post-closing adjustments, in accordance with the Sale Agreement. We used approximately $238.0 million of the net proceeds from the sale of Quest Integrity to pay down $225.0 million of our term loan debt, and to pay 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 consolidated balance sheets and consolidated statements of operations report discontinued operations separate from continuing operations. Our consolidated statements of comprehensive income (loss), statements of shareholders’ 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 major line items constituting net income (loss) from discontinued operations to the after-tax income from discontinued operations (in thousands): December 31, 2022 2021 Major classes of line items constituting net income (loss) from discontinued operations Revenues $ 101,418 $ 80,356 Operating expenses (45,044) (43,616) Selling, general and administrative expenses (32,230) (26,663) Goodwill impairment charge — (8,795) Restructuring and other related charges, net — (381) Interest expense, net (108) (230) Other (expense) income (4,390) 591 Income before income taxes 19,646 1,262 Gain on sale of Quest transaction 203,351 — Income before income taxes 222,997 1,262 Provision for income taxes (2,831) (2,436) Net income (loss) from discontinued operations $ 220,166 $ (1,174) The table below represents the reconciliation of the major classes of assets and liabilities of discontinued operations to amounts presented separately in the consolidated balance sheet as of December 31, 2021 (in thousands). We completed the sale of Quest Integrity on November 1, 2022, as a result there were no assets or liabilities in discontinued operations as of December 31, 2022. December 31, 2021 Carrying amount of major classes of assets included as part of discontinued operations: Cash and cash equivalents $ 10,122 Accounts receivable, net 20,499 Prepaid expenses and other current assets 3,805 Property, plant and equipment, net 15,879 Goodwill and intangible assets, net 26,823 Other classes of assets that are not major 5,968 Total assets associated with discontinued operations $ 83,096 Carrying amounts of major classes of liabilities included as part of discontinued operations: Accounts payable $ 2,125 Income tax payable 1,939 Other accrued liabilities 9,363 Operating lease obligations 2,368 Other classes of liabilities that are not major 601 Total liabilities associated with discontinued operations $ 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 years ended December 31, 2022 and December 31, 2021, 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 $0.1 million of accrued capital expenditures as of December 31, 2021, which is excluded from the consolidated statements of cash flows until paid. The following table presents the depreciation and amortization and capital expenditures of Quest Integrity (in thousands): December 31, 2022 2021 Cash flows provided by operating activities of discontinued operations: Depreciation and amortization $ 1,141 $ 2,616 Cash flows provided by investing activities of discontinued operations: Capital expenditures $ 4,146 $ 3,500 |
REVENUE
REVENUE | 12 Months Ended |
Dec. 31, 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 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 contracts 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. 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, as they are short term in nature, we recognize revenue as jobs are completed or costs are incurred. For contracts where control is transferred at a point in time, revenue is recognized at the time control of the asset is transferred to the customer, which is typically upon delivery and acceptance by the customer. Disaggregation of revenue. Essentially all of our revenues are associated with contracts with customers. A disaggregation of our revenue from contracts with customers by geographic region, by reportable operating segment and by service type is presented below (in thousands): Twelve Months Ended December 31, 2022 United States and Canada Other Countries Total Revenue: IHT $ 412,661 $ 9,901 $ 422,562 MS 296,151 121,495 417,646 Total $ 708,812 $ 131,396 $ 840,208 Twelve Months Ended December 31, 2021 United States and Canada Other Countries Total Revenue: IHT $ 405,007 $ 10,364 $ 415,371 MS 256,806 122,020 378,826 Total $ 661,813 $ 132,384 $ 794,197 Twelve Months Ended December 31, 2022 Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 336,821 $ 180 $ 61,526 $ 24,035 $ 422,562 MS — 413,424 276 3,946 417,646 Total $ 336,821 $ 413,604 $ 61,802 $ 27,981 $ 840,208 Twelve Months Ended December 31, 2021 Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 325,204 $ 467 $ 59,855 $ 29,845 $ 415,371 MS — 374,885 806 3,135 378,826 Total $ 325,204 $ 375,352 $ 60,661 $ 32,980 $ 794,197 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 when the revenue recognized exceeds the amount billed to the customer. 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 December 31, 2022 and 2021 (in thousands): December 31, 2022 2021 Trade accounts receivable, net 1 $ 186,689 $ 168,273 Contract assets 2 $ 2 $ 2 Contract liabilities 3 $ — $ 80 _________________ 1 Includes billed and unbilled amounts, net of allowance for credit losses. See Note 4 - Receivables for details. 2 Included in the “Prepaid expenses and other current assets” line on the consolidated balance sheet. 3 Included in the “Other accrued liabilities” line of the consolidated balance sheet. 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 as of December 31, 2021 was recognized as revenue during the year ended December 31, 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 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 recognized as assets primarily consist of labor and material costs and generally relate to engineering and set-up costs incurred prior to when the satisfaction of performance obligations begins. Assets recognized for costs to fulfill a contract are included in the “Prepaid expenses and other current assets” line of the consolidated balance sheets and were not material as of December 31, 2022 and 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. Remaining performance obligations . As permitted by ASC 606, we have elected not to disclose information about remaining performance obligations where (i) the performance obligation is part of a contract that has an original expected duration of one year or less or (ii) when we recognize revenue from the satisfaction of the performance obligation in accordance with the right-to-invoice practical expedient. As most of our contracts with customers are short-term in nature and billed on a time and material basis, there were no material amounts of remaining performance obligations as of December 31, 2022 and 2021. |
RECEIVABLES
RECEIVABLES | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
RECEIVABLES | RECEIVABLES A summary of accounts receivable as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Trade accounts receivable $ 160,572 $ 142,975 Unbilled revenues 31,379 33,141 Allowance for credit losses (5,262) (7,843) Accounts receivable, net $ 186,689 $ 168,273 We measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This 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. Generally the longer a receivable is outstanding the higher the percentage of the outstanding balance is reported as current expected credit losses. 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: (i) the 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): Twelve Months Ended 2022 2021 Balance at beginning of period $ 7,843 $ 9,115 Provision for expected credit losses 1,059 2,332 Recoveries collected (1,114) (369) Write-offs (2,479) (3,201) Foreign exchange effects (47) (34) Balance at end of period $ 5,262 $ 7,843 |
INVENTORY
INVENTORY | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY A summary of inventory as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Raw materials $ 8,978 $ 7,576 Work in progress 2,945 2,725 Finished goods 24,408 25,074 Inventory $ 36,331 $ 35,375 |
PREPAID AND OTHER CURRENT ASSET
PREPAID AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID AND OTHER CURRENT ASSETS | PREPAID AND OTHER CURRENT ASSETS A summary of prepaid expenses and other current assets as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Insurance receivable $ 39,000 $ 39,000 Prepaid expenses 15,238 10,542 Other current assets 11,441 6,521 Prepaid expenses and other current assets $ 65,679 $ 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 will be covered by our third-party insurance providers for litigation matters that have been settled or are pending settlements and 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 and other accounts receivables. As of December 31, 2022 the other current assets include deferred financing costs of $3.1 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 deferred financing fees amounting to $1.8 million in connection with that certain Substitute Insurance Reimbursement Facility Agreement dated as of September 29, 2022 (the “Substitute Insurance Reimbursement Facility Agreement”) (see Note 12 - Debt for additional details). |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT A summary of property, plant and equipment as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Land $ 4,006 $ 5,227 Buildings and leasehold improvements 50,833 54,597 Machinery and equipment 277,852 278,828 Furniture and fixtures 10,558 10,704 Capitalized ERP system development costs 45,917 45,916 Computers and computer software 19,457 17,993 Automobiles 3,536 3,540 Construction in progress 19,196 11,347 Total 431,355 428,152 Accumulated depreciation and amortization (293,256) (282,672) Property, plant, and equipment, net $ 138,099 $ 145,480 Included in the table above are assets under finance leases of $7.4 million and $6.7 million and accumulated amortization of $2.3 million and $1.6 million as of December 31, 2022 and 2021, respectively. Depreciation expense for the years ended December 31, 2022 and 2021 was $22.9 million, and $25.4 million respectively. Assets sold and disposed of for the twelve months ended December 31, 2022 and the twelve months ended December 31, 2021 had a carrying value of $2.5 million and $0.8 million, respectively, resulting in a gain on sale of $4.2 million and $0 million, respectively. The assets sold for the twelve months ended December 31, 2022 primarily consisted of $1.3 million in land, $0.9 million in building and $0.3 million in machinery and equipment. The assets sold for the twelve months ended December 31, 2021 consisted of $0.8 million in machinery and equipment. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS A summary of intangible assets as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 Gross Accumulated Net Customer relationships $ 165,231 $ (91,296) $ 73,935 Non-compete agreements 4,281 (4,281) — Trade names 20,563 (19,830) 733 Technology 2,707 (1,978) 729 Licenses 840 (830) 10 Other 12,983 (12,983) — Intangible assets $ 206,605 $ (131,198) $ 75,407 December 31, 2021 Gross Accumulated Net Customer relationships $ 165,381 $ (79,081) $ 86,300 Non-compete agreements 4,357 (4,357) — Trade names 20,590 (19,606) 984 Technology 2,731 (1,773) 958 Licenses 850 (774) 76 Other 12,988 (12,988) — Intangible assets $ 206,897 $ (118,579) $ 88,318 Amortization expense on intangible assets for the years ended December 31, 2022 and 2021 was $12.9 million, and $12.9 million, respectively. Amortization expense for intangible assets is forecast to be approximately $12.2 million per year from 2023 through 2027. The weighted-average amortization period for intangible assets subject to amortization was 13.7 years as of December 31, 2022. The weighted-average amortization period as of December 31, 2022 is 13.7 years for customer relationships, 13.2 years for trade names, 10.0 years for technology and 10.5 years for licenses. |
GOODWILL AND IMPAIRMENT CHARGES
GOODWILL AND IMPAIRMENT CHARGES | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Impairment Charges | GOODWILL AND IMPAIRMENT CHARGES Following the sale of Quest Integrity, as discussed above, as of December 31, 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. There was no goodwill impairment charge during the twelve months ended December 31, 2022, however, during the twelve months ended December 31, 2021, we recognized a non-cash goodwill impairment charge of $55.8 million in our MS operating segment and a non-cash goodwill impairment charge of $8.8 million in the discontinued operations of the Quest Integrity operating segment. These charges were a result of a goodwill impairment test that was triggered as a result of certain impairment indicators present during the twelve months ended December 31, 2021, primarily related to the continued curtailment of operations, decline in our forecast, continued declines in our stock price, reporting unit operating losses, and continued declines in the reporting units’ net sales compared to forecast. |
OTHER ACCRUED LIABILITIES
OTHER ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
OTHER ACCRUED LIABILITIES | OTHER ACCRUED LIABILITIES A summary of other accrued liabilities as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Payroll and other compensation expenses $ 48,507 $ 39,599 Legal and professional accruals 46,665 46,762 Insurance accruals 7,483 7,181 Property, sales and other non-income related taxes 7,348 6,553 Accrued interest 3,963 6,469 Volume discount 2,050 1,902 Other accruals 3,251 3,270 Other accrued liabilities $ 119,267 $ 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 Asset s. 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 includes items such as contract liabilities and other accrued expenses. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES For the year ended December 31, 2022, our income tax provision resulted in an effective tax rate of 2.3%. For the year ended December 31, 2021, our income tax provision resulted in an effective tax rate of 5.0%. Our income tax provision for the year ended December 31, 2022 was $3.3 million, our income tax provision for December 31, 2021 was $8.8 million and includes federal, state and foreign taxes. 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 financial statements for the year ended December 31, 2022, 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 $2.2 million in income tax expense for the valuation allowance required to offset the remaining net deferred tax assets. The $2.2 million charge is primarily attributable to our German and Canadian subsidiaries. Refer to Note 1 - Summary of Significant Accounting Policies and Practices for additional liquidity and going concern discussion. The components of our tax provision and benefit on continuing operations were as follows (in thousands): Current Deferred Total Twelve months ended December 31, 2022: U.S. Federal $ (211) $ — $ (211) State & local 513 — 513 Foreign jurisdictions 1,319 1,685 3,004 Tax provision $ 1,621 $ 1,685 $ 3,306 Twelve months ended December 31, 2021: U.S. Federal $ 938 $ (1,115) $ (177) State & local 590 150 740 Foreign jurisdictions 2,494 5,716 8,210 Tax provision $ 4,022 $ 4,751 $ 8,773 The components of pre-tax income (loss) from continuing operations for the years ended December 31, 2022 and 2021 were as follows (in thousands): Twelve Months Ended 2022 2021 Domestic $ (156,001) $ (171,299) Foreign 9,220 (4,773) Pre-tax income (loss) from continuing operations $ (146,781) $ (176,072) The income tax provision in 2022 and provision in 2021 attributable to the loss from continuing operations, respectively, differed from the amounts computed by applying the U.S. federal income tax rate 21% in 2022, (21% in 2021) to pre-tax loss from continuing operations as a result of the following (in thousands): Twelve Months Ended 2022 2021 Pre-tax loss from continuing operations $ (146,781) $ (176,072) Computed income taxes at statutory rate (30,824) (36,975) State income taxes, net of federal benefit 395 561 Foreign tax rate differential 701 1,380 Non-cash compensation 228 320 Deferred taxes on investment in foreign subsidiaries — (1,939) Non-deductible expenses 118 229 Foreign withholding 693 1,078 Prior year tax adjustments 7 141 Goodwill impairment — 9,399 Valuation allowance 31,430 34,284 Rate change — (140) Other 558 435 Total expense (benefit) for income tax on continuing operations $ 3,306 $ 8,773 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below (in thousands): December 31, 2022 2021 Deferred tax assets: Accrued compensation and benefits $ 7,630 $ 7,831 Receivables 552 1,345 Inventory 296 316 Share based compensation 258 271 Other accrued liabilities 2,940 3,467 Tax credit carry forward 2,314 3,613 Interest expense limitation 28,137 22,312 Goodwill and intangible costs 10,143 9,221 Convertible debt 1,780 — Net operating loss carry forwards 38,860 68,972 Other 1,770 2,428 Deferred tax assets 94,680 119,776 Less: Valuation allowance (73,483) (89,191) Deferred tax assets, net $ 21,197 $ 30,585 Deferred tax liabilities: Property, plant and equipment (17,642) (20,267) Unremitted earnings of foreign subsidiaries (3,581) (3,944) Convertible debt — (7,359) Other (3,260) (2,408) Deferred tax liabilities (24,483) (33,978) Net deferred tax asset (liability) 1 $ (3,286) $ (3,393) ________________ 1 As of December 31, 2021, certain deferred tax balances associated with discontinued operations remain on the balance sheet and in the inventory of deferred taxes but are presented within current assets and current liabilities associated with discontinued operations. Management evaluates all available evidence, both positive and negative, to determine whether sufficient future taxable income will be generated to allow for the realization of the existing deferred tax assets. A valuation allowance is recognized if, based on the weight of available evidence, it is more likely than not that some portion of the deferred tax asset will not be realized. A significant factor of negative evidence evaluated was the cumulative pre-tax loss incurred over the two-year period ended December 31, 2022. This objective evidence limits the ability to consider other subjective positive evidence, such as our projections for future pre-tax income. On the basis of this evaluation, as of December 31, 2022, a valuation allowance of $73.5 million has been recorded to recognize only the portion of the deferred tax asset that is more likely than not to be realized. This valuation allowance relates primarily to the deferred tax assets for federal, foreign and state tax net operating loss carryforwards. The amount of deferred tax asset considered realizable could be adjusted if there are changes to net operating loss carryforward periods or there is a change to the weight assessed on various sources of positive and negative evidence. The current year increase in the valuation allowance is primarily attributable to our foreign operations. In the current quarter, we were able to release $11.5 million of valuation allowance resulting from the realization of deferred tax assets for our U.S. operations. As of December 31, 2022, we had net operating loss carryforwards for U.S. federal income tax purposes of $104.2 million. Of this amount, $3.7 million expires in various dates through 2037, which is subject to limitations under Section 382 of the U.S. Internal Revenue Code of 1986 as a result of stock ownership changes from Quest Integrity business sale, and $100.5 million has an indefinite carryforward period. These carryforwards are available, subject to certain limitations such as mentioned above, to offset future taxable income. Further, we have state net operating loss carryforwards of $178.6 million with $156.5 million expiring on various dates through 2041 and $22.1 million with an indefinite carryforward period. As of December 31, 2022, we had interest expense carryforward for U.S. income tax purposes of $120.6 million. The entire $120.6 million has an indefinite carryforward period. These carryforwards are available, subject to certain limitations, to offset future taxable income. As of December 31, 2022, the Company had $2.2 million of tax credits that will expire on various dates through 2037 if not utilized. As of December 31, 2022, we had foreign net operating loss carryforwards totaling $25.1 million. Of this amount, $1.8 million will expire in various dates through 2031 and $23.3 million has an unlimited carryforward period. As of December 31, 2022, none of our undistributed earnings of foreign operations were considered to be permanently reinvested overseas. As of December 31, 2022, the deferred tax liability related to undistributed earnings of foreign subsidiaries was $2.6 million. As of December 31, 2022, $1.7 million of unrecognized tax benefits would affect our effective tax rate. We estimate the uncertain tax benefits that may be recognized within the next twelve months will not be material. Our policy is to recognize interest and penalties related to unrecognized tax benefits in income tax expense. We file income tax returns in the U.S. federal and state jurisdictions as well as various foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local or non-U.S. income tax examinations by tax authorities for years prior to 2016. We are currently under audit in one of the states in which we do substantial business. As of December 31, 2022, we recorded a $0.5 million tax liability in our uncertain positions related to this audit due to retroactive changes included in final regulations issued by the state. Certain Dutch entities were also under audit. We did not anticipate any material adjustments related to these examinations. Periodic examinations of our tax filings occur by the taxing authorities for the jurisdictions in which we conduct business. These examinations review the significant positions taken on our returns, including the timing and amount of income and deductions reported, as well as the allocation of income among multiple taxing jurisdictions. We do not expect any material adjustments to result from positions taken on our income tax returns. The following table summarizes the Company’s reconciliation of gross unrecognized tax benefits, excluding penalties and interest, for the year ended December 31, 2022 and 2021 (in thousands): Twelve Months Ended 2022 2021 Unrecognized tax benefits - January 1 $ 1,285 $ 1,610 Additions based on current year tax positions — — Additions based on tax positions related to prior years 350 543 Reductions based on tax positions related to prior years — — Disposition of uncertain tax positions of discontinued operations (426) — Settlements — — Reductions resulting from a lapse of the applicable statute of limitations (112) (868) Unrecognized tax benefits - December 31 $ 1,097 $ 1,285 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT As of December 31, 2022 and 2021, our total long-term debt and finance lease obligations are summarized as follows (in thousands): December 31, 2022 2021 2020 ABL Facility $ — $ 62,000 2022 ABL Facility 99,916 — APSC Term Loan 31,562 214,191 Subordinated Term Loan 107,905 36,358 Total 239,383 312,549 Convertible Debt 1 40,650 87,662 Finance lease obligations 2 5,902 5,640 Total debt and finance lease obligations 285,935 405,851 Current portion of long-term debt and finance lease obligations (280,993) (667) Total long-term debt and finance lease obligations, less current portion $ 4,942 $ 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. For information on our finance lease obligations, see Note 13 - Leases . 2020 ABL Facility On December 18, 2020, we entered into an 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 provided for available borrowings up to $150.0 million (the “2020 ABL Facility”). The 2020 ABL Facility’s original maturity date was December 18, 2024. The 2020 ABL Facility had a variable interest rate of either a base rate or a LIBOR rate, plus an applicable margin. The 2020 ABL Facility was fully paid off on February 11, 2022. 2022 ABL Facility 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, as amended by ABL Amendment No. 1 and ABL Amendment No. 2, the “2022 ABL Credit Agreement”). Available funding commitments to us under the 2022 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 “Delayed Draw Term Loan”) provided by Corre Partners Management, LLC and certain of its affiliates (“Corre”) (collectively, the “2022 ABL Credit Facility”). The proceeds of the loans under the 2022 ABL Credit Facility were used to, among other things, pay off and terminate the 2020 ABL Facility. The 2022 ABL Facility matures in February 2025. Our obligations under the 2022 ABL Credit Agreement are guaranteed by certain of our direct and certain indirect subsidiaries referenced below as the “ABL Guarantors” and, together with the Company, the “ABL Loan Parties”. Our obligations under the 2022 ABL Credit Facility are secured on a first priority basis by, among other things, accounts receivable, deposit accounts, securities accounts and inventory of the ABL Loan Parties and are secured on a second priority basis by substantially all of the other assets of the ABL Loan Parties. Availability under the revolving credit line under the 2022 ABL Credit Facility is based on a percentage of the value of accounts receivable and inventory, reduced by certain reserves. Revolving credit loans under the 2022 ABL Credit Facility bear interest through maturity at a variable rate based upon a LIBOR Rate (or a base rate if the LIBOR Rate is unavailable for any reason), plus an applicable margin (“LIBOR Rate Loan” and “Base Rate Loan”, respectively). The “base rate” is a fluctuating interest rate equal to the greatest of (1) the federal funds rate plus 0.50%, (2) Wells Fargo Bank, National Association’s prime rate, and (3) the one-month LIBOR Rate. The “applicable margin” is defined as a rate of 3.15%, 3.40% or 3.65% for Base Rate Loans with a 2.00% base rate floor and a rate of 4.15%, 4.40% or 4.65% for LIBOR Rate Loans with a 1.00% LIBOR floor, in each case depending on the amount of EBITDA as of the most recent measurement period, as reported in a monthly compliance certificate. The Delayed Draw Term Loan bears interest through maturity at a rate of the LIBOR Rate plus 10.0%, with a 1.00% LIBOR floor. The fee for undrawn revolving amounts is 0.50% and the fee for undrawn Delayed Draw Term Loan amounts is 3.00%. Interest under the 2022 ABL Credit Facility is payable monthly. The Company will also be required to pay customary letter of credit fees, as necessary. The Company may make voluntary prepayments of the loans under the 2022 ABL Credit Facility from time to time, subject, in the case of the Delayed Draw Term Loan, to certain conditions. Mandatory prepayments are also required in certain circumstances, including with respect to the Delayed Draw Term Loan, if the ratio of aggregate value of the collateral under the 2022 ABL Credit Facility to the sum of the Delayed Draw Term Loan plus revolving facility usage outstanding is less than 130%. Amounts repaid may be re-borrowed, subject to compliance with the borrowing base and the other conditions set forth in the 2022 ABL Credit Agreement, subject, in the case of the Delayed Draw Term Loan to a maximum of four such borrowings in any 12-month period. Certain permanent repayments of the 2022 ABL Credit Facility loans are subject to the payment of a premium of 2.00% during the first year of the facility, 1.00% during the second year of the facility, and 0.50% in the last year of the facility. The 2022 ABL Credit Agreement contains customary conditions to borrowings and covenants, including covenants that restrict our ability to sell assets, make changes to the nature of our business, engage in mergers or acquisitions, incur, assume or permit to exist additional indebtedness and guarantees, create or permit to exist liens, pay dividends, issue equity instruments, make distributions or redeem or repurchase capital stock or make other investments, engage in transactions with affiliates and make payments in respect of certain debt. The 2022 ABL Credit Agreement also requires that we will not exceed $20.0 million in unfinanced capital expenditures in any calendar year; provided that this requirement will not apply if we maintain 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. In addition, the 2022 ABL Credit Agreement includes customary events of default, the occurrence of which may require that we pay an additional 2.0% interest on the outstanding loans under the 2022 ABL Credit Facility. The interest rate as of December 31, 2022 was 8.77% for Eclipse and 14.12% for the Delayed Draw Term Loan. Direct and incremental costs associated with the issuance of the 2022 ABL Credit Facility were approximately $8.4 million and were capitalized as deferred financing costs. These costs are being amortized on a straight-line basis over the term of the 2022 ABL Credit Facility. Unamortized deferred financing cost amounted to $3.1 million and $2.9 million as of December 31, 2022 and December 31, 2021, respectively. Additionally, the amortization period for deferred financing costs and debt discounts and issuance cost was accelerated to reflect the revised Maturity Reserve Trigger Date (as defined in the 2022 ABL Credit Agreement) 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. On May 6, 2022, we entered into Amendment No.1 to the 2022 ABL Credit Agreement (“ABL Amendment No. 1”) which, among other things, modified the Maturity Reserve Trigger Date (as defined in the 2022 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 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 less than $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 entered into Amendment No. 2 to the 2022 ABL Credit Agreement (“ABL Amendment No. 2”) which, among other things, (i) modified the Maturity Reserve Trigger Date 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. As of December 31, 2022, we had $64.9 million outstanding under the Revolving Credit Loans and $35.0 million outstanding under the Delayed Draw Term Loans. There were $8.7 million outstanding in letters of credit secured by these instruments, which are off-balance sheet. As of December 31, 2022, subject to the applicable sublimit and other terms and conditions, $52.4 million was available for loans or for issuance of new letters of credit, consisting of $42.4 million available under the Revolving Credit Loans and $10.0 million available under the Delayed Draw Term Loan. APSC Term Loan On December 18, 2020, we entered into that certain Term Loan Credit Agreement (as amended by Term Loan Amendment No. 1, Term Loan Amendment No. 2, Term Loan Amendment No. 3, Term Loan Amendment No. 4, Term Loan Amendment No. 5, Term Loan Amendment No. 6, Term Loan Amendment No. 7, Term Loan Amendment No. 8 and Term Loan Amendment No. 9, the “Term Loan Credit Agreement”) with Atlantic Park Strategic Capital Fund, L.P., as agent (“APSC”), pursuant to which we borrowed $250.0 million (the “Term Loan”). The Term Loan was issued with a 3% original issuance discount, such that total proceeds received were $242.5 million. 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, on the Maturity Trigger Date (45 days prior to the maturity date of the Notes (currently June 17, 2023)), (i) the maturity date of the Notes has not been extended past the date that is 91 days after the sixth anniversary of the closing date of the Term Loan Credit Agreement or (ii) the Notes have an aggregate principal amount outstanding of $10.0 million or more, in which case the Term Loan will terminate on the Maturity Trigger Date. 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 2022 ABL Credit Facility, and we may, subject to the terms and conditions in the Term Loan Credit Agreement, 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 base rate is a fluctuating interest rate equal to the greater of (i) the federal funds rate plus 0.50%, (ii), the prime rate as specified in the Term Loan Credit Agreement, and (iii) one-month LIBOR rate plus 1.00%. The applicable margin is defined as a rate of 6.50% for base rate borrowings with a 2.00% base rate floor and 7.50% for LIBOR rate borrowings with a 1.00% LIBOR rate floor. Interest is payable either (i) monthly for Base rate borrowings or (ii) the last day of the interest period for LIBOR rate borrowings, as set forth in the Term Loan Credit Agreement. The Term Loan is prepayable in whole or in part, at any time and from time to time, subject to a prepayment premium (including a make whole during the first two years) specified in the Term Loan Credit Agreement (subject to certain exceptions), plus accrued and unpaid interest. The effective interest rate on the Term Loan as of December 31, 2022 and December 31, 2021 was 37.99% and 20.90%, respectively. As of December 31, 2022, the effective interest consisted of a 11.73% variable interest rate paid in cash and an additional 26.26% due to the acceleration of the amortization of the related debt issuance costs. As of December 31, 2021, the effective interest consisted of a 8.5% variable interest rate paid in cash and an additional 12.4% due to the acceleration of the amortization of the related debt issuance costs. The unamortized balances of debt discounts, warrant discount and debt issuance cost amounted to $3.9 million and $35.8 million at December 31, 2022 and December 31, 2021, respectively. Interest expense amounted to $21.8 million and $21.9 million for the years ended December 31, 2022 and 2021, respectively. The Term Loan contains customary payment penalties, events of default and covenants, including but not limited to, covenants that restrict our ability to sell assets, make changes to the nature of our business, engage in mergers or acquisitions, incur additional indebtedness and guarantees, pay dividends, issue equity instruments and make distributions or redeem or repurchase capital stock. On October 19, 2021, we entered into Amendment No. 1 to the Term Loan Credit Agreement (“Term Loan Amendment No. 1”) with the financial institutions party thereto from time to time (the “Lenders”) and APSC, as agent. Term Loan Amendment No. 1, among other things, (i) deferred an October 19, 2021 interest payment until October 29, 2021; (ii) required that the Company use commercially reasonable efforts to appoint an additional independent director to our Board of Directors who is acceptable to the agent; (iii) provided the Lenders with additional information rights; and (iv) tightened certain negative covenants included in the Term Loan Credit Agreement until the deferred interest is made current. On October 29, 2021, we entered into Amendment No. 2 to the Term Loan Credit Agreement (“Term Loan Amendment No. 2”) with the Lenders and APSC, as agent. Term Loan Amendment No. 2, among other things, (i) further deferred an October 29, 2021 interest payment until November 15, 2021; (ii) contained certain milestones; (iii) provided the Lenders with a ten-day right of first refusal regarding any refinancing of the Company’s obligations under the 2020 ABL Facility; (iv) obligated the Company to establish, pursuant to a charter to be adopted by the our Board of Directors and reasonably acceptable to the agent, a special committee that shall have exclusive responsibility and authority to make recommendations to our Board of Directors regarding certain transactions; and (v) provided that the Company will not permit a covenant trigger event under the 2020 ABL Facility to occur. On November 8, 2021, we entered into Amendment No. 3 to the Term Loan Credit Agreement (“Term Loan Amendment No. 3”). Term Loan Amendment No. 3, among other things, (i) waived certain covenants until September 30, 2022 and modified covenants thereafter to provide us with more flexibility and (ii) required us to seek shareholder approval (or an exception therefrom) to issue additional warrants to APSC, providing for the purchase of an aggregate of 1,417,051 shares of our common stock (the “APSC Warrants”) at an exercise price of $1.50 per share, and to amend the warrants issued in December 2020 to APSC 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”), to provide for an exercise price of $1.50 per share. Following the Reverse Stock Split, the APSC Warrants provide for the purchase of up to 500,000 shares of our common stock at an exercise price of $15.00 per share. Term Loan Amendment No. 3 also reduced the required amount of principal outstanding on the Notes on the Maturity Trigger Date from $50.0 million to $10.0 million. On December 2, 2021, and December 7, 2021, respectively, we entered into Amendment No. 4 to the Term Loan Credit Agreement (“Term Loan Amendment No. 4”) and Amendment No.5 to the Term Loan Credit Agreement (“Term Loan Amendment No. 5”), respectively. Term Loan Amendment No. 4 extended the date upon which the Company must issue the APSC Warrants to December 7, 2021, and Term Loan Amendment No. 5 extended the date upon which the Company must issue the APSC Warrants to December 8, 2021. On February 11, 2022, we entered into Amendment No. 6 to the Term Loan Credit Agreement (“Term Loan Amendment No. 6”). Term Loan Amendment No. 6, among other things, (i) permitted the entry into the 2022 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 to the Term Loan Credit Agreement (“Term Loan Amendment No. 7”). Term Loan Amendment No. 7, 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 the Notes 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 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 2, 2022, we used the net proceeds from the sale of Quest Integrity to pay down $225.0 million of debt under the Term Loan Credit Agreement and to pay certain fees associated with such repayment and related accrued interest, which reduced the principal balance to $35.5 million, with the remaining proceeds reserved for general corporate purposes, thereby reducing our future debt service obligations and leverage and improving our liquidity. The transaction was treated as a partial debt extinguishment, and a loss in the amount of $30.1 million was recognized in the current income statement consisting of cash fees and premium paid in the amount of $12.4 million and the noncash write off of the related unamortized balance of deferred issuance cost and warrant and debt discounts in the amount of $17.7 million. On November 4, 2022, we entered into Amendment No. 9 to the Term Loan Credit Agreement which 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 Credit Agreement On November 9, 2021, we entered into a credit agreement (as amended by Corre Amendment 1, Corre Amendment 2, Corre Amendment 3, Corre Amendment 4, Corre Amendment 5, Corre Amendment 6, Corre Amendment 7, Corre Amendment 8, Corre Amendment 9, Corre Amendment 10 and Corre Amendment 11, and the related Springing Maturity Date (as defined below) provision (the “Subordinated Term Loan Credit Agreement”) with Corre Credit Fund, LLC (“Corre Fund”), as agent, and the lenders party thereto providing for an unsecured $50.0 million delayed draw subordinated term loan facility (the “Subordinated Term Loan”). Pursuant to the Subordinated Term Loan Credit Agreement, we borrowed $22.5 million on November 9, 2021, and an additional $27.5 million on December 8, 2021. The Subordinated Term Loan matures, and all outstanding amounts become due and payable, on the earlier of December 31, 2027 and the date that is two weeks following the maturity or full repayment of the Term Loan (the “Springing Maturity Date”). The stated interest rate on the Subordinated Term Loan is 12.00% which is payable in the form of paid-in-kind interest (“PIK Interest”). The effective interest rate as of December 31, 2022 and December 31, 2021 was 29.23% and 45.53%, respectively. As of December 31, 2022, the effective interest consisted of 12.00% stated interest and an additional 17.23% due to the acceleration of the amortization of the related debt issuance costs. At December 31, 2021, the effective interest consisted of the 12.00% stated interest and an additional 33.53% due to the acceleration of the amortization of the related debt issuance costs. The unamortized debt issuance cost amounted to $7.5 million and $13.9 million as of December 31, 2022 and December 31, 2021, respectively. Interest expense amounted to $11.4 million and $0.6 million for the years ended December 31, 2022 and 2021, respectively. Under the Subordinated Term Loan Credit Agreement, we were required to, among other things, (i) subject to certain conditions, issue the lenders warrants (as defined below), (ii) amend our charter, bylaws, and all other necessary corporate governance documents to reduce the size of our Board of Directors to seven directors, one of whom included our Chief Executive Officer, and (iii) reconstitute our Board of Directors. The Subordinated Term Loan Credit Agreement also contained other customary prepayment provisions, events of default and covenants. On November 30, 2021, we entered into Amendment No. 1 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 1”). Corre Amendment 1 (i) extended the payment date for interest in the form of PIK interest with respect to the Initial Term Loans (as defined in the Subordinated Term Loan Credit Agreement), (ii) extended the date upon which the Company must deliver a fully executed ABL Consent (as defined in the Subordinated Term Loan Credit Agreement) to, in each case, 11:59 P.M. on December 6, 2021 and (iii) extended the date upon which we must issue the Corre Warrants to 11:59 P.M. on December 7, 2021. On December 6, 2021, we entered into Amendment No. 2 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 2”). Corre Amendment 2 (i) extended the payment date for interest in the form of PIK Interest with respect to the Initial Term Loans, and (ii) extended the date upon which we must deliver a fully executed ABL Consent to, in each case, 11:59 P.M. on December 7, 2021. On December 7, 2021, we entered into Amendment No. 3 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 3”). Corre Amendment 3, among other things, (i) extended the payment date for interest in the form of PIK Interest with respect to the Initial Term Loans, (ii) extended the date upon which we must deliver a fully executed ABL Consent and (iii) extended the date upon which we must issue the Corre Warrants to, in each case, 11:59 P.M. on December 8, 2021. On December 8, 2021, we entered into Amendment No. 4 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 4”). Corre Amendment 4 appointed Cantor Fitzgerald Securities as successor agent. In connection with the transactions contemplated by the 2022 ABL Credit Agreement on February 11, 2022, Corre, agreed to provide the Company with incremental financing (the “Incremental Financing”), totaling approximately $55.0 million, consisting of (i) a $35.0 million Delayed Draw Term Loan under the 2022 ABL Credit Facility; (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 the purchase of 11,904,762 PIPE 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”). The business purpose of the Corre Amendments was to further extend the liquidity runway of the Company and support ongoing negotiations of the financing transactions completed on February 11, 2022. On February 11, 2022, we entered into Amendment No. 5 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 5”) with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent. Corre Amendment 5, which among other things, (i) 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, (ii) permitted entry into the 2022 ABL Credit Facility, (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 will 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 these unfinanced capital expenditures requirement 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. 6 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 6”) with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent. Corre Amendment 6, among other things, amended the financial covenants, such that the maximum net leverage ratio to be tested for the fiscal quarter 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 (“Corre Amendment 7”) 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 Corre Amendment No. 8 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 8”) with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent, that among other things, (i) increased the total principal amount outstanding under the Subordinated Term Loan Credit Agreement to approximately $112.7 million to give effect to the exchange of their convertible debt and (ii) extended the availability date for the additional commitment of $10.0 million in subordinated delayed draw term loans from October 31, 2022 to December 31, 2022. See Convertible Debt below for impact of the amendment to the Notes outstanding. On November 1, 2022, we entered into Amendment No. 9 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 9”) with the guarantors party thereto, the lenders from time to time party thereto and Cantor Fitzgerald Securities, as agent. Corre Amendment 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 Corre Amendment No. 10 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 10”) with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent, which 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. On November 21, 2022, we entered into Amendment No. 11 to the Subordinated Term Loan Credit Agreement (“Corre Amendment 11”) with the lenders from time to time party thereto (including Corre), and Cantor Fitzgerald Securities, as agent. Corre Amendment 11 amended the Subordinated Term Loan Credit Agreement to, inter alia , (i) extend the stated maturity date from December 31, 2026 to December 31, 2027 (subject to the Springing Maturity Date), (ii) extend the availability date for the additional commitment of $10.0 million in Subordinated delayed draw term loans to the end of March 31, 2023 rather than December 31, 2022 and (iii) create a new tranche of term loans representing the increased principal amount of unsecured term loans (which loans are not subject to the springing maturity of 14 days after payment in full of the Term Loan created in connection with the exchange of the Notes pursuant to the Exchange Agreement (as defined below) dated as of October 4, 2022, by and among the Company and certain holders of the Notes. There was no increase in the aggregate amount outstanding under the Subordinated Term Loan as a result of Corre Amendment 11. Warrants As of December 31, 2022 and 2021, we held the following warrants: Original After Reverse Stock Split (Effective date December 22, 2023) Holder Date Number of shares Exercise price Expiration date Number of shares Exercise price Total value of stock Expiration date APSC Holdco II, LP Original 12/18/2020 3,582,949 $ 7.75 6/14/2028 Amended 11/9/2021 500,000 $ 1.50 6/14/2028 Amended 12/8/2021 917,051 $ 1.50 12/8/2028 Total APSC 5,000,000 $ 1.50 12/8/2028 500,000 $ 15.00 $ 7,500,000 12/8/2028 Corre 12/8/2021 5,000,000 $ 1.50 12/8/2028 500,000 $ 15.00 $ 7,500,000 12/8/2028 Total warrants 10,000,000 1,000,000 $ 15,000,000 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 were 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. In connection with execution of the Subordinated Term Loan Credit Agreement and Term Loan Amendment No. 3, 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 and to reduce the exercise price to $1.50 per share. In connection with execution of the Subordinated Term Loan Credit Agreement and the amendments to the Term Loan Credit Agreement, on December 8, 2021 we entered into (i) the Second Amended and Restated Common Stock Purchase Warrant No. 1 (the “Second A&R Warrant”) with APSC Holdco, pursuant to which the A&R Warrant was amended and restated to provide for the purchase of up to 5,000,000 shares of our common stock (including 4,082,949 shares of Common Stock issuable pursuant to the A&R Warrant) exercisable at the holder’s option at any time, in whole or in part, until December 8, 2028, at an exercise price of $1.50 per share, and (ii) the Common Stock Purchase Warrants (collectively, the “Corre Warrants” and, together with the Second A&R Warrant, the “Warrants”) with each of Corre Opportunities Qualified Master Fund, LP, Corre Horizon Fund |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | LEASES We adopted ASC 842 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): December 31, 2022 2021 Operating lease costs $ 25,116 $ 27,773 Variable lease costs 5,346 5,546 Finance lease costs: Amortization of right-of-use assets 765 666 Interest on lease liabilities 421 344 Total lease cost $ 31,648 $ 34,329 Lease cost - discontinued operations $ 841 $ 1,656 Lease cost - continuing operations $ 30,807 $ 32,673 Other information related to leases are as follows (in thousands): December 31, 2022 2021 Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 19,032 $ 16,856 Operating cash flows from finance leases 316 345 Financing cash flows from finance leases 885 515 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 3,455 $ 8,008 Finance leases $ 1,270 $ 1,011 Amounts recognized in the consolidated balance sheet are as follows (in thousands): December 31, 2022 2021 Operating Leases: Operating lease right-of-use assets $ 48,462 $ 58,495 Current portion of operating lease obligations 13,823 15,412 Operating lease obligations (non-current) 38,819 47,617 Finance Leases: Property, plant and equipment, net $ 5,107 $ 5,114 Current portion of long-term debt and finance lease obligations 960 667 Long-term debt and finance lease obligations 4,942 4,973 Weighted average remaining lease term Operating leases 6 years 6 years Finance leases 9 years 10 years Weighted average discount rate Operating leases 7.5 % 6.8 % Finance lease 7.3 % 6.4 % As of December 31, 2022, we have no material additional operating and finance leases that have not yet commenced. As of December 31, 2022, future minimum lease payments under non-cancellable (excluding short-term leases) are as follows (in thousands): Twelve Months Ended December 31, Operating Leases Finance Leases 2023 $ 14,228 $ 1,179 2024 11,893 954 2025 8,761 686 2026 6,527 586 2027 5,480 543 Thereafter 11,318 3,376 Total future minimum lease payments $ 58,207 $ 7,324 Less: Interest 5,565 1,422 Present value of lease liabilities $ 52,642 $ 5,902 Total rent expense resulting from operating leases, including short-term leases, for the years ended December 31, 2022 and 2021 were $37.3 million, $39.4 million, respectively. |
Leases | LEASES We adopted ASC 842 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): December 31, 2022 2021 Operating lease costs $ 25,116 $ 27,773 Variable lease costs 5,346 5,546 Finance lease costs: Amortization of right-of-use assets 765 666 Interest on lease liabilities 421 344 Total lease cost $ 31,648 $ 34,329 Lease cost - discontinued operations $ 841 $ 1,656 Lease cost - continuing operations $ 30,807 $ 32,673 Other information related to leases are as follows (in thousands): December 31, 2022 2021 Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 19,032 $ 16,856 Operating cash flows from finance leases 316 345 Financing cash flows from finance leases 885 515 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 3,455 $ 8,008 Finance leases $ 1,270 $ 1,011 Amounts recognized in the consolidated balance sheet are as follows (in thousands): December 31, 2022 2021 Operating Leases: Operating lease right-of-use assets $ 48,462 $ 58,495 Current portion of operating lease obligations 13,823 15,412 Operating lease obligations (non-current) 38,819 47,617 Finance Leases: Property, plant and equipment, net $ 5,107 $ 5,114 Current portion of long-term debt and finance lease obligations 960 667 Long-term debt and finance lease obligations 4,942 4,973 Weighted average remaining lease term Operating leases 6 years 6 years Finance leases 9 years 10 years Weighted average discount rate Operating leases 7.5 % 6.8 % Finance lease 7.3 % 6.4 % As of December 31, 2022, we have no material additional operating and finance leases that have not yet commenced. As of December 31, 2022, future minimum lease payments under non-cancellable (excluding short-term leases) are as follows (in thousands): Twelve Months Ended December 31, Operating Leases Finance Leases 2023 $ 14,228 $ 1,179 2024 11,893 954 2025 8,761 686 2026 6,527 586 2027 5,480 543 Thereafter 11,318 3,376 Total future minimum lease payments $ 58,207 $ 7,324 Less: Interest 5,565 1,422 Present value of lease liabilities $ 52,642 $ 5,902 Total rent expense resulting from operating leases, including short-term leases, for the years ended December 31, 2022 and 2021 were $37.3 million, $39.4 million, respectively. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION We have adopted stock incentive plans and other arrangements pursuant to which our Board of Directors may grant stock options, restricted stock, stock units, stock appreciation rights, common stock or performance awards to officers, directors and key employees. As of December 31, 2022, there were approximately 103,274 restricted stock units, performance awards and stock options outstanding to officers, directors and key employees. The exercise price, terms and other conditions applicable to each form of share-based compensation under our plans are generally determined by the Compensation Committee of our Board at the time of grant and may vary. In May 2021, our shareholders approved the amendment and restatement to 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 Common Stock, before the reverse stock split discussed below. Shares issued in connection with our share-based compensation are issued out of authorized but unissued common stock. On December 21, 2022, we completed a reverse stock split of our outstanding common stock at a ratio of one-for-ten. The Reverse Stock Split effected a proportionate reduction in shares available for issuance under our 2018 Plan. We have made proportionate adjustments to the number of stock units outstanding and issuable upon exercise or vesting of our outstanding awards as well as the applicable exercise prices and weighted average fair value. No fractional shares were issued in connection with the Reverse Stock Split. Compensation expense related to share-based compensation totaled $0.2 million and $7.0 million for the years ended December 31, 2022 and 2021, respectively. Share-based compensation expense reflects an estimate of expected forfeitures. As of December 31, 2022, $1.4 million of unrecognized compensation expense related to share-based compensation is expected to be recognized over a remaining weighted-average period of 1.4 years. The recognized income tax benefit totaled $0.0 million and $0.7 million for the years ended December 31, 2022 and 2021, respectively. 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 twelve months ended December 31, 2022 are summarized below: Twelve Months Ended No. of Stock Weighted (in thousands) Stock and stock units, beginning of year 80 $ 73.06 Changes during the year: Granted 79 $ 8.56 Vested and settled (42) $ 80.51 Cancelled (19) $ 66.86 Stock and stock units, end of year 98 $ 19.55 The intrinsic value of stock units and director stock grants vested during the years ended December 31, 2022 and 2021 was $0.5 million and $1.2 million, respectively. 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 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 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 2020 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. For performance awards, we recorded income of $1.3 million and expense of $2.6 million for the years ended December 31, 2022 and 2021, respectively. Transactions involving our performance awards during the twelve months ended December 31, 2022 are summarized below: Twelve Months Ended 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 68 $ 64.88 22 $ 98.65 Changes during the period: Cancelled and forfeited (66) $ 62.08 (20) $ 96.23 Performance stock units, end of period 2 $ 149.60 2 $ 116.90 __________________________ 1 Performance units with variable payouts are shown at target level of performance. The intrinsic value of performance stock unit awards vested during the year ended December 31, 2021 was $0.3 million. There were no performance stock units vested during the year ended December 31, 2022. 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 years ended December 31, 2022 and 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. Transactions involving our stock options for the twelve months ended December 31, 2022 are summarized below: Twelve Months Ended No. of Weighted (in thousands) Shares under option, beginning of year 2 $ 316.80 Changes during the year: Expired (1) $ (277.13) Shares under option, end of year 1 $ 356.03 Exercisable at end of year 1 $ 356.03 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | STOCKHOLDERS’ EQUITY Shareholder’s Equity and Preferred Stock On December 21, 2022, we completed a reverse stock split of our outstanding common stock at a ratio of one-for-ten. The Reverse Stock Split effected a proportionate reduction in our authorized shares of common stock from 120,000,000 shares to 12,000,000 shares and reduced the number of shares of common stock outstanding from approximately 43,429,089 shares to approximately 4,342,909 shares. We have made proportionate adjustments to the number of common shares issuable upon exercise or conversion of our outstanding warrants, equity awards and convertible securities, as well as the applicable exercise prices and weighted average fair value of the equity awards. No fractional shares were issued in connection with the Reverse Stock Split. As of December 31, 2022 there were 4,342,909 shares of our Company common stock outstanding and 12,000,000 shares authorized at $0.30 par value per share. As of December 31, 2022 we had 500,000 authorized shares of preferred stock, none of which had been issued. Warrants In connection with the Amended Term Loan Credit Agreement and the Subordinated Term Loan Credit Agreement, we entered into Warrant Agreements and Waivers related to our common stock. A detailed discussion of these transactions can be found in Note 12 - Debt. Issuance of PIPE Shares In connection with the 2022 ABL Credit Agreement and the Subscription Agreement, PIPE shares were issued and sold, subject to certain terms and conditions. A detailed discussion of these transactions can be found in Note 12 - Debt. Accumulated Other Comprehensive Income (loss) A summary of changes in accumulated other comprehensive loss included within shareholders’ equity is as follows (in thousands): Twelve Months Ended Twelve Months Ended Foreign Foreign Defined benefit pension plans Tax Total Foreign Foreign Defined benefit pension plans Tax Total Balance at beginning of year $ (25,258) $ 2,988 $ (3,873) $ (589) $ (26,732) $ (23,045) $ 2,988 $ (8,021) $ 400 $ (27,678) Other comprehensive income (loss) (6,589) — (6,601) 925 (12,265) (2,213) — 4,148 (989) 946 Balance at end of year $ (31,847) $ 2,988 $ (10,474) $ 336 $ (38,997) $ (25,258) $ 2,988 $ (3,873) $ (589) $ (26,732) The following table represents the related tax effects allocated to each component of other comprehensive income (loss) (in thousands): Twelve Months Ended December 31, 2022 2021 Gross Tax Net Gross Tax Net Foreign currency translation adjustments $ (6,589) $ — $ (6,589) $ (2,213) $ (1) $ (2,214) Defined benefit pension plans (6,601) 925 (5,676) 4,148 (988) 3,160 Total $ (13,190) $ 925 $ (12,265) $ 1,935 $ (989) $ 946 |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Defined contribution plan. Under the Team, Inc. Salary Deferral Plan (the “Plan”), contributions are made to the Plan by qualified employees at their election and our matching contributions to the Plan are made at specified rates. We did not incur any contribution expense in 2021 as forfeitures were used for the company match. Our contribution for the plan year ended December 31, 2022 was approximately $3.3 million. Defined benefit plans. In connection with our acquisition of Furmanite, we assumed liabilities associated with the defined benefit pension plans of two foreign subsidiaries, one plan covering certain United Kingdom employees (the “U.K. Plan”) and the other covering certain Norwegian employees (the “Norwegian Plan”). In connection with the sale of our Norwegian operations in 2018, all assets and liabilities associated with the Norwegian Plan were transferred to the buyer. Benefits for the U.K. Plan are based on the average of the employee’s salary for the last three years of employment. The U.K. Plan has had no new participants added since the plan was frozen in 1994 and accruals for future benefits ceased in connection with a plan curtailment in 2013. Plan assets are primarily invested in unitized pension funds managed by U.K. registered fund managers. The most recent valuation of the U.K. Plan was performed as of December 31, 2022. Estimated defined benefit pension plan contributions for 2023 are expected to be approximately $3.7 million. 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 rate assumption used to determine end of year benefit obligations was 5.0% as of December 31, 2022. These rates are reviewed annually and adjusted to reflect current conditions. These rates are determined appropriate based on reference to yields. The expected return on plan assets of 2.8% for 2022 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 management believes that the assumptions used are appropriate, differences in actual experience or changes in assumptions may affect the pension obligation and future expense. Net pension cost (credit) included the following components (in thousands): Twelve Months Ended 2022 2021 Interest cost $ 1,586 $ 1,282 Settlement cost — 70 Expected return on plan assets (2,362) (2,006) Amortization of prior service cost 31 32 Net pension cost (credit) $ (745) $ (622) The weighted-average assumptions used to determine benefit obligations as of December 31, 2022 and 2021 are as follows: December 31, 2022 2021 Discount rate 5.0 % 2.0 % Rate of compensation increase 1 Not applicable Not applicable Inflation 3.2 % 3.3 % ______________ 1 Not applicable due to plan curtailment. The weighted-average assumptions used to determine net periodic benefit cost (credit) for the years ended December 31, 2022 and 2021 are as follows: Twelve Months Ended 2022 2021 Discount rate 2.0 % 1.3 % Expected long-term return on plan assets 2.8 % 2.1 % Rate of compensation increase 1 Not applicable Not applicable Inflation 3.3 % 2.9 % _______________ 1 Not applicable due to plan curtailment. The plan actuary determines the expected return on plan assets based on a combination of expected yields on equity securities and corporate bonds and considering historical returns. The expected long-term rate of return on invested assets for 2022 is determined based on the weighted average of expected returns on asset investment categories as follows: 6.4% overall, 9.5% for equities and 5.3% for debt securities. The following table sets forth the changes in the benefit obligation and plan assets for the years ended December 31, 2022 and 2021 (in thousands): Twelve Months Ended 2022 2021 Projected benefit obligation: Beginning of year $ 91,262 $ 100,244 Service cost — — Interest cost 1,586 1,282 Actuarial (gain) loss (22,444) (4,237) Benefits paid (5,028) (5,137) Foreign currency translation adjustment and other (9,206) (890) End of year $ 56,170 $ 91,262 Fair value of plan assets: Beginning of year 94,164 94,962 Actual gain (loss) on plan assets (26,919) 1,195 Employer contributions 3,699 4,118 Benefits paid (5,028) (5,137) Foreign currency translation adjustment and other (9,348) (974) End of year 56,568 94,164 Excess projected obligation under (over) fair value of plan assets at end of year $ 398 $ 2,902 Amounts recognized in accumulated other comprehensive loss: Net actuarial loss $ (10,980) $ (4,624) Prior service cost (520) (601) Total $ (11,500) $ (5,225) The accumulated benefit obligation for the U.K. Plan was $56.2 million and $91.3 million as of December 31, 2022 and 2021, respectively. The decrease in the accumulated benefit obligation was due to the increase in discount rate driven by higher interest rate during the period. As of December 31, 2022, expected future benefit payments are as follows for the years ended December 31, (in thousands): 2023 $ 3,738 2024 3,645 2025 3,808 2026 3,756 2027 3,836 2028-2032 19,388 Total $ 38,171 The following tables summarize the plan assets of the U.K. Plan measured at fair value on a recurring basis (at least annually) as of December 31, 2022 and 2021 (in thousands): December 31, 2022 Asset Category Total Quoted Prices in Significant Significant Cash $ 1,861 $ 1,861 $ — $ — Equity securities: Diversified growth fund (a) 15,285 — 4,848 10,437 Fixed income securities: U.K. government fixed income securities (b) 6,471 — 6,471 — U.K. government index-linked securities (c) 7,942 — 7,942 — Corporate bonds (e) 25,009 — 25,009 — Total $ 56,568 $ 1,861 $ 44,270 $ 10,437 December 31, 2021 Asset Category Total Quoted Prices in Significant Significant Cash $ 2,411 $ 2,411 $ — $ — Equity securities: Diversified growth fund (a) 23,582 — 12,139 11,443 Fixed income securities: U.K. government fixed income securities (b) 9,487 — 9,487 — U.K. government index-linked securities (c) 16,393 — 16,393 — Global absolute return bond fund (d) 12,111 — 12,111 — Corporate bonds (e) 30,297 — 30,297 — Total $ 94,281 $ 2,411 $ 80,427 $ 11,443 a) This category includes investments in a diversified portfolio of equity, alternatives and cash markets that aims to achieve capital growth returns. b) This category includes investments in funds with the objective to provide a leveraged return to U.K. government fixed income securities (bonds) that have maturity periods ranging from 2030 to 2060. c) This category includes investments in funds with the objective to provide a leveraged return to various U.K. government indexed-linked securities (gilts), with maturity periods ranging from 2027 to 2062. The funds invest in U.K. government bonds and derivatives. d) This category includes investments in funds predominantly in a wide range of fixed and floating rate investment grade and below investment grade debt instruments traded on regulated markets worldwide with the objective to achieve a return of 3% above 1 month LIBOR over a 3-year basis. e) This category includes investments in a diversified pool of debt and debt like assets to generate capital and income returns. Investment objectives for the U.K. Plan, as of December 31, 2022, are to: • optimize the long-term return on plan assets at an acceptable level of risk • maintain a broad diversification across asset classes • maintain careful control of the risk level within each asset class The trustees of the U.K. Plan have established a long-term investment strategy comprising global investment weightings targeted at 27.5% (range of 25% to 30%) for equity securities/diversified growth funds and 72.5% (range of 70% to 75%) for debt securities. Diversified growth funds are actively managed absolute return funds that hold a combination of debt and equity securities. Selection of the targeted asset allocation was based upon a review of the expected return and risk characteristics of each asset class, as well as the correlation of returns among asset classes. Actual allocations to each asset class vary from target allocations due to periodic investment strategy changes, market value fluctuations and the timing of benefit payments and contributions. The following table sets forth the weighted-average asset allocation and target asset allocations as of December 31, 2022 and 2021 by asset category: Asset Allocations Target Asset Allocations 2022 2021 2022 2021 Equity securities and diversified growth funds 1 27.0 % 24.9 % 27.5 % 27.5 % Debt securities 2 69.7 % 72.5 % 72.5 % 72.5 % Other 3.3 % 2.6 % — % — % Total 100 % 100 % 100 % 100 % ______________________________ 1 Diversified growth funds refer to actively managed absolute return funds that hold a combination of equity and debt securities. 2 Includes investments in funds with the objective to provide leveraged returns to U.K. government fixed income securities, U.K. government indexed-linked securities, global bonds, and corporate bonds. The following table summarizes the changes in the fair value measurements of Level 3 investments for the pension plans (in thousands): December 31, 2022 December 31, 2021 Balance at beginning of year $ 11,443 $ 9,752 Actual return on plan assets 195 1,790 Purchases/ sales/ settlements — — Transfer in/out of level 3 — — Changes due to foreign exchange (1,201) (99) Balance at end of year $ 10,437 $ 11,443 The following is a description of the valuation methodologies used to measure plan assets at fair value. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 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 - The Company was a defendant in a consolidated class and collective action, Michael Thai v. Team Industrial Services, Inc., et al, pending in the U.S. District Court for the Central District of California, originally filed by two separate plaintiffs as separate cases in the Superior Court for the County of Los Angeles, California in June 2019 and August 2020, respectively. The Company settled the consolidated class and collective action in 2022 that resulted in the Company recording a pre-tax charge of $3.0 million in the third quarter of fiscal year 2022, and the Company paid the settlement in January 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 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 that 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 will seek to overturn the verdict in post-trial motions before the District Court and, if necessary, to appeal to the Court of Appeals for the State of Texas. 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 that 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 December 31, 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. Accordingly, for all matters discussed above, we have accrued in the aggregate approximately $42.3 million as of December 31, 2022, of which approximately $3.3 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 consultation with legal counsel that the Other Proceedings, individually or in the aggregate, will not have a material effect on our consolidated financial statements. |
SEGMENT AND GEOGRAPHIC DISCLOSU
SEGMENT AND GEOGRAPHIC DISCLOSURES | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHIC DISCLOSURES | SEGMENT AND GEOGRAPHIC DISCLOSURES On November 1, 2022, we completed the sale of Quest Integrity business. The criteria for reporting Quest Integrity as a discontinued operation were met as of the sale and, as such, all periods presented in this Form 10-K have been recast to present Quest Integrity as a discontinued operation. Unless otherwise specified, the financial information and discussion in this Form 10-K 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. Segment data for our two operating segments are as follows (in thousands): Twelve Months Ended 2022 2021 Revenues: IHT $ 422,562 $ 415,371 MS 417,646 378,826 Total Revenues $ 840,208 $ 794,197 Twelve Months Ended 2022 2021 Operating income (loss): IHT $ 17,093 $ 12,997 MS 1 20,930 (47,728) Corporate and shared support services (77,825) (92,151) Total Operating income (loss) $ (39,802) $ (126,882) ______________ 1 Includes goodwill impairment loss of $55.8 million for MS for the year ended December 31, 2021. Twelve Months Ended 2022 2021 Capital expenditures 1 : IHT $ 13,939 $ 11,742 MS 5,013 3,692 Corporate and shared support services 84 1,464 Total Capital expenditures $ 19,036 $ 16,898 ______________ 1 Excludes finance leases. Totals may vary from amounts presented in the consolidated statements of cash flows due to the timing of cash payments. Twelve Months Ended 2022 2021 Depreciation and amortization: IHT $ 12,391 $ 12,959 MS 19,021 20,500 Corporate and shared support services 5,041 5,443 Total Depreciation and amortization $ 36,453 $ 38,902 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 years ended December 31, 2022 and 2021 and our total long-lived assets as of December 31, 2022 and 2021 are as follows (in thousands): Total Revenues 1 Total Long-lived Assets 2 Twelve months ended December 31, 2022 United States $ 613,021 $ 240,088 Canada 95,790 4,708 Europe 61,713 14,591 Other foreign countries 69,684 2,581 Total $ 840,208 $ 261,968 Twelve months ended December 31, 2021 United States $ 561,416 $ 261,540 Canada 100,397 7,290 Europe 66,926 19,619 Other foreign countries 65,458 3,845 Total $ 794,197 $ 292,294 ______________ 1 Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
RESTRUCTURING AND OTHER RELATED
RESTRUCTURING AND OTHER RELATED CHARGES | 12 Months Ended |
Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER RELATED CHARGES | RESTRUCTURING AND OTHER RELATED CHARGES Our restructuring and other related charges, net for the years ended December 31, 2022 and 2021 are summarized by segment as follows (in thousands): Twelve Months Ended December 31, 2022 2021 Operating Group Reorganization and other restructuring measures Severance and related costs IHT $ 16 $ 459 MS — 514 Corporate and shared support services — 1,562 Total $ 16 $ 2,535 Operating Group Reorganization. During 2021, we completed a strategic organizational structure to better position ourselves for the recovery, continue sector diversification, and enhance client value (the “Operating Group Reorganization”). In connection with the Operating Group Reorganization, we announced certain executive leadership changes and the appointment of experienced new talent to our leadership team. For the twelve months ended December 31, 2021, we incurred severance charges of $2.5 million, which represents all costs cumulatively incurred to date as a result of the Operating Group Reorganization. For the twelve months ended December 31, 2022 and 2021, we incurred professional fees of $0 and $1.9 million, respectively, associated with the Operating Group Reorganization. Severance Charges. As part of our ongoing cost reduction efforts, we incurred severance charges of $4.0 million for the twelve months ended December 31, 2022. A rollforward of our accrued severance liability associated with our ongoing cost reduction efforts is presented below (in thousands): Twelve Months Ended Balance, beginning of period $ 712 Charges 3,961 Payments (2,734) Balance, end of period $ 1,939 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONSAlvarez & 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 $8.1 million and $8.0 million in consulting fees to Alvarez & Marsal for the years ended December 31, 2022 and 2021, respectively. In connection with the Company’s debt transactions, the Company engaged in transactions with Corre and APSC to provide funding as described in Note 12 - Debt |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSAs of March 14, 2023, the filing date of this Annual Report on Form 10-K, management evaluated the existence of events occurring subsequent to the end of fiscal year 2022, and determined that there were no events or transactions that would have a material impact on the Company’s results of operations or financial position. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis for presentation | Basis for presentation. These 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 consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of results for such periods. |
Consolidation | Consolidation. The 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 herein) 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. |
Use of estimates | Use of estimates. Our accounting policies conform to Generally Accepted Accounting Principles (“GAAP”) in the United States. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect our reported financial position and results of operations. We review significant estimates and judgments affecting our consolidated financial statements on a recurring basis and record the effect of any necessary adjustments prior to their publication. Estimates and judgments are based on information available at the time such estimates and judgments are made. Adjustments made with respect to the use of these estimates and judgments often relate to information not previously available. Uncertainties with respect to such estimates and judgments are inherent in the preparation of financial statements. Estimates and judgments are used in, among other things, (1) valuation of acquisition related tangible and intangible assets and assessments of all long-lived assets for possible impairment, (2) estimating various factors used to accrue liabilities for workers’ compensation, auto, medical and general liability, (3) establishing an allowance for uncollectible accounts receivable, (4) estimating the useful lives of our assets, (5) assessing future tax exposure and the realization of tax assets, (6) selecting assumptions used in the measurement of costs and liabilities associated with defined benefit pension plans, (7) assessments of fair value and (8) 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 FASB 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 those that are unobservable and of a highly subjective measure. Our financial instruments consist primarily of cash, cash equivalents, accounts receivable, accounts payable, pension assets 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. For additional information regarding our pension assets, see Note 16 - Employee Benefit plan . The fair value of our 2022 ABL Credit Facility and Term Loans are 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 the Notes as of December 31, 2022 and 2021 was $37.5 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 2022 ABL Credit Facility, Term Loan, Subordinated Term Loan and Notes, see Note 12 - Debt . |
Cash and cash equivalents | Cash and cash equivalents . |
Inventory | Inventory . Except for certain inventories that are valued based on standard 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 value is reduced to net realizable |
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. 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. As of December 31, 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 part of discontinued operations. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets. The Company reviews its property and equipment, intangible assets subject to amortization and other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset class may not be recoverable. Indicators of potential impairment include: an adverse change in legal factors or in the business climate that could affect the value of the asset; an adverse change in the extent or manner in which the asset is used or is expected to be used, or in its physical condition; and current or forecasted operating or cash flow losses that demonstrate continuing losses associated with the use of the asset. If indicators of impairment are present, the asset is tested for recoverability by comparing the carrying value of the asset to the related estimated undiscounted future cash flows expected to be derived from the asset. If the expected cash flows are less than the carrying value of the asset, then the asset is considered to be impaired and its carrying value is written down to fair value, based on the related estimated discounted cash flows. There were no impairment charges in 2022 or 2021. |
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 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 we operate in. 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 is 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. As of December 31, 2022, our deferred tax assets were $94.7 million, less a valuation allowance of $73.5 million. As of December 31, 2022, our deferred tax liabilities were $24.5 million. 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. As of December 31, 2022, our gross unrecognized tax benefits, excluding penalties and interest related to uncertain tax positions, were $1.1 million. |
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 self-insured retention is currently $2.0 million per occurrence. For professional liability claims, our self-insured retention is $2.0 million. For general liability claims, we have a self-insured retention of $1.0 million and a deductible of $4.0 million per occurrence. 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. For medical claims, our self-insured retention is $350,000 per individual claimant determined on an annual basis. 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 or 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 accounted for more than 10% of consolidated revenues during the year ended December 31, 2022 or 2021. |
Accounting for Warrants | Accounting for Warrants . The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. As of December 31, 2022 and 2021, we had equity-classified warrants that were issued in connection with our APSC Term Loan and Subordinated Term Loan Credit Agreement (see Note 12 - Debt ). The warrants were accounted for as a component of additional paid-in capital and a debt warrant discount. The warrant discount was being amortized over the term of the debt. As of December 31, 2022 and 2021, an unamortized balance of warrant discount amounted to $3.3 million and $29.2 million, respectively. |
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 treasury stock method. Our current intent is to settle the principal amount of our Notes in cash upon conversion. 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 years ended December 31, 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, the effect of our Notes was 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 on our Notes and our share-based compensation awards, refer to Note 12 - Debt and Note 14 - Share-Based Compensation |
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. |
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. These rates are reviewed annually and adjusted to reflect current conditions. These rates are determined based on reference to yields. 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 & 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 , (“ASU 2020-06”), 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 this ASU using the modified retrospective method. We recognized a cumulative effect of initially applying this 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, (“ASU 2020-04”). 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 the London Interbank Offered Rate, (“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. On December 21, 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848) Deferral of the Sunset Date of Topic 848 which defers the sunset date of ASC 848, Reference Rate Reform , from December 31, 2022, to December 31, 2024. While we are currently determining whether we will elect the optional expedients, we do not expect our adoption of these ASU’s 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) | 12 Months Ended |
Dec. 31, 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 consolidated statements of cash flows and are as follows (in thousands): Twelve Months Ended 2022 2021 Assets acquired under finance lease $ 1,270 $ 1,011 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The table below represents major line items constituting net income (loss) from discontinued operations to the after-tax income from discontinued operations (in thousands): December 31, 2022 2021 Major classes of line items constituting net income (loss) from discontinued operations Revenues $ 101,418 $ 80,356 Operating expenses (45,044) (43,616) Selling, general and administrative expenses (32,230) (26,663) Goodwill impairment charge — (8,795) Restructuring and other related charges, net — (381) Interest expense, net (108) (230) Other (expense) income (4,390) 591 Income before income taxes 19,646 1,262 Gain on sale of Quest transaction 203,351 — Income before income taxes 222,997 1,262 Provision for income taxes (2,831) (2,436) Net income (loss) from discontinued operations $ 220,166 $ (1,174) The table below represents the reconciliation of the major classes of assets and liabilities of discontinued operations to amounts presented separately in the consolidated balance sheet as of December 31, 2021 (in thousands). We completed the sale of Quest Integrity on November 1, 2022, as a result there were no assets or liabilities in discontinued operations as of December 31, 2022. December 31, 2021 Carrying amount of major classes of assets included as part of discontinued operations: Cash and cash equivalents $ 10,122 Accounts receivable, net 20,499 Prepaid expenses and other current assets 3,805 Property, plant and equipment, net 15,879 Goodwill and intangible assets, net 26,823 Other classes of assets that are not major 5,968 Total assets associated with discontinued operations $ 83,096 Carrying amounts of major classes of liabilities included as part of discontinued operations: Accounts payable $ 2,125 Income tax payable 1,939 Other accrued liabilities 9,363 Operating lease obligations 2,368 Other classes of liabilities that are not major 601 Total liabilities associated with discontinued operations $ 16,396 The following table presents the depreciation and amortization and capital expenditures of Quest Integrity (in thousands): December 31, 2022 2021 Cash flows provided by operating activities of discontinued operations: Depreciation and amortization $ 1,141 $ 2,616 Cash flows provided by investing activities of discontinued operations: Capital expenditures $ 4,146 $ 3,500 |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Dec. 31, 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): Twelve Months Ended December 31, 2022 United States and Canada Other Countries Total Revenue: IHT $ 412,661 $ 9,901 $ 422,562 MS 296,151 121,495 417,646 Total $ 708,812 $ 131,396 $ 840,208 Twelve Months Ended December 31, 2021 United States and Canada Other Countries Total Revenue: IHT $ 405,007 $ 10,364 $ 415,371 MS 256,806 122,020 378,826 Total $ 661,813 $ 132,384 $ 794,197 Twelve Months Ended December 31, 2022 Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 336,821 $ 180 $ 61,526 $ 24,035 $ 422,562 MS — 413,424 276 3,946 417,646 Total $ 336,821 $ 413,604 $ 61,802 $ 27,981 $ 840,208 Twelve Months Ended December 31, 2021 Non-Destructive Evaluation and Testing Services Repair and Maintenance Services Heat Treating Other Total Revenue: IHT $ 325,204 $ 467 $ 59,855 $ 29,845 $ 415,371 MS — 374,885 806 3,135 378,826 Total $ 325,204 $ 375,352 $ 60,661 $ 32,980 $ 794,197 |
Contract with Customer, Asset and Liability | The following table provides information about trade accounts receivable, contract assets and contract liabilities as of December 31, 2022 and 2021 (in thousands): December 31, 2022 2021 Trade accounts receivable, net 1 $ 186,689 $ 168,273 Contract assets 2 $ 2 $ 2 Contract liabilities 3 $ — $ 80 _________________ 1 Includes billed and unbilled amounts, net of allowance for credit losses. See Note 4 - Receivables for details. 2 Included in the “Prepaid expenses and other current assets” line on the consolidated balance sheet. 3 Included in the “Other accrued liabilities” line of the consolidated balance sheet. |
RECEIVABLES (Tables)
RECEIVABLES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Summary of Accounts Receivable | A summary of accounts receivable as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Trade accounts receivable $ 160,572 $ 142,975 Unbilled revenues 31,379 33,141 Allowance for credit losses (5,262) (7,843) Accounts receivable, net $ 186,689 $ 168,273 |
Allowance for Credit Loss | The following table shows a rollforward of the allowance for credit losses (in thousands): Twelve Months Ended 2022 2021 Balance at beginning of period $ 7,843 $ 9,115 Provision for expected credit losses 1,059 2,332 Recoveries collected (1,114) (369) Write-offs (2,479) (3,201) Foreign exchange effects (47) (34) Balance at end of period $ 5,262 $ 7,843 |
INVENTORY (Tables)
INVENTORY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Summary of Inventory | A summary of inventory as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Raw materials $ 8,978 $ 7,576 Work in progress 2,945 2,725 Finished goods 24,408 25,074 Inventory $ 36,331 $ 35,375 |
PREPAID AND OTHER CURRENT ASS_2
PREPAID AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid and Other Current Assets | A summary of prepaid expenses and other current assets as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Insurance receivable $ 39,000 $ 39,000 Prepaid expenses 15,238 10,542 Other current assets 11,441 6,521 Prepaid expenses and other current assets $ 65,679 $ 56,063 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | A summary of property, plant and equipment as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Land $ 4,006 $ 5,227 Buildings and leasehold improvements 50,833 54,597 Machinery and equipment 277,852 278,828 Furniture and fixtures 10,558 10,704 Capitalized ERP system development costs 45,917 45,916 Computers and computer software 19,457 17,993 Automobiles 3,536 3,540 Construction in progress 19,196 11,347 Total 431,355 428,152 Accumulated depreciation and amortization (293,256) (282,672) Property, plant, and equipment, net $ 138,099 $ 145,480 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | A summary of intangible assets as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 Gross Accumulated Net Customer relationships $ 165,231 $ (91,296) $ 73,935 Non-compete agreements 4,281 (4,281) — Trade names 20,563 (19,830) 733 Technology 2,707 (1,978) 729 Licenses 840 (830) 10 Other 12,983 (12,983) — Intangible assets $ 206,605 $ (131,198) $ 75,407 December 31, 2021 Gross Accumulated Net Customer relationships $ 165,381 $ (79,081) $ 86,300 Non-compete agreements 4,357 (4,357) — Trade names 20,590 (19,606) 984 Technology 2,731 (1,773) 958 Licenses 850 (774) 76 Other 12,988 (12,988) — Intangible assets $ 206,897 $ (118,579) $ 88,318 |
OTHER ACCRUED LIABILITIES (Tabl
OTHER ACCRUED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Summary of Other Accrued Liabilities | A summary of other accrued liabilities as of December 31, 2022 and 2021 is as follows (in thousands): December 31, 2022 2021 Payroll and other compensation expenses $ 48,507 $ 39,599 Legal and professional accruals 46,665 46,762 Insurance accruals 7,483 7,181 Property, sales and other non-income related taxes 7,348 6,553 Accrued interest 3,963 6,469 Volume discount 2,050 1,902 Other accruals 3,251 3,270 Other accrued liabilities $ 119,267 $ 111,736 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Components of Tax Provision (Benefit) | The components of our tax provision and benefit on continuing operations were as follows (in thousands): Current Deferred Total Twelve months ended December 31, 2022: U.S. Federal $ (211) $ — $ (211) State & local 513 — 513 Foreign jurisdictions 1,319 1,685 3,004 Tax provision $ 1,621 $ 1,685 $ 3,306 Twelve months ended December 31, 2021: U.S. Federal $ 938 $ (1,115) $ (177) State & local 590 150 740 Foreign jurisdictions 2,494 5,716 8,210 Tax provision $ 4,022 $ 4,751 $ 8,773 |
Components of Pre-Tax Income (Loss) | The components of pre-tax income (loss) from continuing operations for the years ended December 31, 2022 and 2021 were as follows (in thousands): Twelve Months Ended 2022 2021 Domestic $ (156,001) $ (171,299) Foreign 9,220 (4,773) Pre-tax income (loss) from continuing operations $ (146,781) $ (176,072) |
Income Tax Expense (Benefit) Attributable to Income (Loss) from Continuing Operations Differed from Amounts Computed by Federal Income Tax Rate | The income tax provision in 2022 and provision in 2021 attributable to the loss from continuing operations, respectively, differed from the amounts computed by applying the U.S. federal income tax rate 21% in 2022, (21% in 2021) to pre-tax loss from continuing operations as a result of the following (in thousands): Twelve Months Ended 2022 2021 Pre-tax loss from continuing operations $ (146,781) $ (176,072) Computed income taxes at statutory rate (30,824) (36,975) State income taxes, net of federal benefit 395 561 Foreign tax rate differential 701 1,380 Non-cash compensation 228 320 Deferred taxes on investment in foreign subsidiaries — (1,939) Non-deductible expenses 118 229 Foreign withholding 693 1,078 Prior year tax adjustments 7 141 Goodwill impairment — 9,399 Valuation allowance 31,430 34,284 Rate change — (140) Other 558 435 Total expense (benefit) for income tax on continuing operations $ 3,306 $ 8,773 |
Tax Effects of Temporary Differences that Give Rise to Significant Portions of Deferred Tax Assets and Deferred Tax Liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below (in thousands): December 31, 2022 2021 Deferred tax assets: Accrued compensation and benefits $ 7,630 $ 7,831 Receivables 552 1,345 Inventory 296 316 Share based compensation 258 271 Other accrued liabilities 2,940 3,467 Tax credit carry forward 2,314 3,613 Interest expense limitation 28,137 22,312 Goodwill and intangible costs 10,143 9,221 Convertible debt 1,780 — Net operating loss carry forwards 38,860 68,972 Other 1,770 2,428 Deferred tax assets 94,680 119,776 Less: Valuation allowance (73,483) (89,191) Deferred tax assets, net $ 21,197 $ 30,585 Deferred tax liabilities: Property, plant and equipment (17,642) (20,267) Unremitted earnings of foreign subsidiaries (3,581) (3,944) Convertible debt — (7,359) Other (3,260) (2,408) Deferred tax liabilities (24,483) (33,978) Net deferred tax asset (liability) 1 $ (3,286) $ (3,393) ________________ 1 As of December 31, 2021, certain deferred tax balances associated with discontinued operations remain on the balance sheet and in the inventory of deferred taxes but are presented within current assets and current liabilities associated with discontinued operations. |
Reconciliation of Changes in Unrecognized Tax Benefits Associated with Uncertain Tax Positions | The following table summarizes the Company’s reconciliation of gross unrecognized tax benefits, excluding penalties and interest, for the year ended December 31, 2022 and 2021 (in thousands): Twelve Months Ended 2022 2021 Unrecognized tax benefits - January 1 $ 1,285 $ 1,610 Additions based on current year tax positions — — Additions based on tax positions related to prior years 350 543 Reductions based on tax positions related to prior years — — Disposition of uncertain tax positions of discontinued operations (426) — Settlements — — Reductions resulting from a lapse of the applicable statute of limitations (112) (868) Unrecognized tax benefits - December 31 $ 1,097 $ 1,285 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Long-Term Debt | As of December 31, 2022 and 2021, our total long-term debt and finance lease obligations are summarized as follows (in thousands): December 31, 2022 2021 2020 ABL Facility $ — $ 62,000 2022 ABL Facility 99,916 — APSC Term Loan 31,562 214,191 Subordinated Term Loan 107,905 36,358 Total 239,383 312,549 Convertible Debt 1 40,650 87,662 Finance lease obligations 2 5,902 5,640 Total debt and finance lease obligations 285,935 405,851 Current portion of long-term debt and finance lease obligations (280,993) (667) Total long-term debt and finance lease obligations, less current portion $ 4,942 $ 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 Warrants or Rights | As of December 31, 2022 and 2021, we held the following warrants: Original After Reverse Stock Split (Effective date December 22, 2023) Holder Date Number of shares Exercise price Expiration date Number of shares Exercise price Total value of stock Expiration date APSC Holdco II, LP Original 12/18/2020 3,582,949 $ 7.75 6/14/2028 Amended 11/9/2021 500,000 $ 1.50 6/14/2028 Amended 12/8/2021 917,051 $ 1.50 12/8/2028 Total APSC 5,000,000 $ 1.50 12/8/2028 500,000 $ 15.00 $ 7,500,000 12/8/2028 Corre 12/8/2021 5,000,000 $ 1.50 12/8/2028 500,000 $ 15.00 $ 7,500,000 12/8/2028 Total warrants 10,000,000 1,000,000 $ 15,000,000 |
Convertible Debt | As of December 31, 2022 and 2021, the Notes were recorded in our consolidated balance sheet as follows (in thousands): December 31, 2022 2021 Liability component: Principal $ 41,162 $ 93,130 Unamortized issuance costs (377) (916) Unamortized discount (135) (4,552) Net carrying amount of the liability component 1 $ 40,650 $ 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 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 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 consolidated balance sheets. The following table sets forth interest expense information related to the Notes (dollars in thousands): December 31, 2022 2021 Coupon interest $ 5,700 $ 4,657 Amortization of debt discount and issuance costs 2,405 3,129 Total interest expense $ 8,105 $ 7,786 Effective interest rate 7.84 % 9.12 % |
Schedule of Error Corrections and Prior Period Adjustments | Accordingly, the cumulative effect of the changes made on our January 1, 2022 consolidated balance sheet for the adoption of ASU 2020-06 was as follows (in thousands): Balances as of 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 $ 453,247 $ (5,651) $ 447,596 Accumulated deficit $ (375,584) $ 3,824 $ (371,760) |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Lease, Cost | The components of lease expense are as follows (in thousands): December 31, 2022 2021 Operating lease costs $ 25,116 $ 27,773 Variable lease costs 5,346 5,546 Finance lease costs: Amortization of right-of-use assets 765 666 Interest on lease liabilities 421 344 Total lease cost $ 31,648 $ 34,329 Lease cost - discontinued operations $ 841 $ 1,656 Lease cost - continuing operations $ 30,807 $ 32,673 |
Schedule of Other Information Related to Leases | Other information related to leases are as follows (in thousands): December 31, 2022 2021 Supplemental cash flow information: Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 19,032 $ 16,856 Operating cash flows from finance leases 316 345 Financing cash flows from finance leases 885 515 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 3,455 $ 8,008 Finance leases $ 1,270 $ 1,011 |
Amounts Recognized in Balance Sheet for Leases | Amounts recognized in the consolidated balance sheet are as follows (in thousands): December 31, 2022 2021 Operating Leases: Operating lease right-of-use assets $ 48,462 $ 58,495 Current portion of operating lease obligations 13,823 15,412 Operating lease obligations (non-current) 38,819 47,617 Finance Leases: Property, plant and equipment, net $ 5,107 $ 5,114 Current portion of long-term debt and finance lease obligations 960 667 Long-term debt and finance lease obligations 4,942 4,973 Weighted average remaining lease term Operating leases 6 years 6 years Finance leases 9 years 10 years Weighted average discount rate Operating leases 7.5 % 6.8 % Finance lease 7.3 % 6.4 % |
Schedule of Finance Lease Liability | As of December 31, 2022, future minimum lease payments under non-cancellable (excluding short-term leases) are as follows (in thousands): Twelve Months Ended December 31, Operating Leases Finance Leases 2023 $ 14,228 $ 1,179 2024 11,893 954 2025 8,761 686 2026 6,527 586 2027 5,480 543 Thereafter 11,318 3,376 Total future minimum lease payments $ 58,207 $ 7,324 Less: Interest 5,565 1,422 Present value of lease liabilities $ 52,642 $ 5,902 |
Schedule of Operating Lease Liability | As of December 31, 2022, future minimum lease payments under non-cancellable (excluding short-term leases) are as follows (in thousands): Twelve Months Ended December 31, Operating Leases Finance Leases 2023 $ 14,228 $ 1,179 2024 11,893 954 2025 8,761 686 2026 6,527 586 2027 5,480 543 Thereafter 11,318 3,376 Total future minimum lease payments $ 58,207 $ 7,324 Less: Interest 5,565 1,422 Present value of lease liabilities $ 52,642 $ 5,902 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 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 twelve months ended December 31, 2022 are summarized below: Twelve Months Ended No. of Stock Weighted (in thousands) Stock and stock units, beginning of year 80 $ 73.06 Changes during the year: Granted 79 $ 8.56 Vested and settled (42) $ 80.51 Cancelled (19) $ 66.86 Stock and stock units, end of year 98 $ 19.55 |
Summary of Transactions Involving Performance Awards | Transactions involving our performance awards during the twelve months ended December 31, 2022 are summarized below: Twelve Months Ended 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 68 $ 64.88 22 $ 98.65 Changes during the period: Cancelled and forfeited (66) $ 62.08 (20) $ 96.23 Performance stock units, end of period 2 $ 149.60 2 $ 116.90 __________________________ 1 Performance units with variable payouts are shown at target level of performance. |
Summary of Transactions Involving Stock Options | Transactions involving our stock options for the twelve months ended December 31, 2022 are summarized below: Twelve Months Ended No. of Weighted (in thousands) Shares under option, beginning of year 2 $ 316.80 Changes during the year: Expired (1) $ (277.13) Shares under option, end of year 1 $ 356.03 Exercisable at end of year 1 $ 356.03 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Summary of Changes in Accumulated Other Comprehensive Income (Loss) Included Within Shareholders' Equity | A summary of changes in accumulated other comprehensive loss included within shareholders’ equity is as follows (in thousands): Twelve Months Ended Twelve Months Ended Foreign Foreign Defined benefit pension plans Tax Total Foreign Foreign Defined benefit pension plans Tax Total Balance at beginning of year $ (25,258) $ 2,988 $ (3,873) $ (589) $ (26,732) $ (23,045) $ 2,988 $ (8,021) $ 400 $ (27,678) Other comprehensive income (loss) (6,589) — (6,601) 925 (12,265) (2,213) — 4,148 (989) 946 Balance at end of year $ (31,847) $ 2,988 $ (10,474) $ 336 $ (38,997) $ (25,258) $ 2,988 $ (3,873) $ (589) $ (26,732) |
Related Tax Effects Allocated to Each Component of Accumulated Other Comprehensive Income | The following table represents the related tax effects allocated to each component of other comprehensive income (loss) (in thousands): Twelve Months Ended December 31, 2022 2021 Gross Tax Net Gross Tax Net Foreign currency translation adjustments $ (6,589) $ — $ (6,589) $ (2,213) $ (1) $ (2,214) Defined benefit pension plans (6,601) 925 (5,676) 4,148 (988) 3,160 Total $ (13,190) $ 925 $ (12,265) $ 1,935 $ (989) $ 946 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Schedule of Net Benefit Cost (Credit) | Net pension cost (credit) included the following components (in thousands): Twelve Months Ended 2022 2021 Interest cost $ 1,586 $ 1,282 Settlement cost — 70 Expected return on plan assets (2,362) (2,006) Amortization of prior service cost 31 32 Net pension cost (credit) $ (745) $ (622) |
Schedule of Assumptions Used | The weighted-average assumptions used to determine benefit obligations as of December 31, 2022 and 2021 are as follows: December 31, 2022 2021 Discount rate 5.0 % 2.0 % Rate of compensation increase 1 Not applicable Not applicable Inflation 3.2 % 3.3 % ______________ 1 Not applicable due to plan curtailment. The weighted-average assumptions used to determine net periodic benefit cost (credit) for the years ended December 31, 2022 and 2021 are as follows: Twelve Months Ended 2022 2021 Discount rate 2.0 % 1.3 % Expected long-term return on plan assets 2.8 % 2.1 % Rate of compensation increase 1 Not applicable Not applicable Inflation 3.3 % 2.9 % _______________ 1 Not applicable due to plan curtailment. |
Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets | The following table sets forth the changes in the benefit obligation and plan assets for the years ended December 31, 2022 and 2021 (in thousands): Twelve Months Ended 2022 2021 Projected benefit obligation: Beginning of year $ 91,262 $ 100,244 Service cost — — Interest cost 1,586 1,282 Actuarial (gain) loss (22,444) (4,237) Benefits paid (5,028) (5,137) Foreign currency translation adjustment and other (9,206) (890) End of year $ 56,170 $ 91,262 Fair value of plan assets: Beginning of year 94,164 94,962 Actual gain (loss) on plan assets (26,919) 1,195 Employer contributions 3,699 4,118 Benefits paid (5,028) (5,137) Foreign currency translation adjustment and other (9,348) (974) End of year 56,568 94,164 Excess projected obligation under (over) fair value of plan assets at end of year $ 398 $ 2,902 Amounts recognized in accumulated other comprehensive loss: Net actuarial loss $ (10,980) $ (4,624) Prior service cost (520) (601) Total $ (11,500) $ (5,225) |
Schedule of Expected Benefit Payments | As of December 31, 2022, expected future benefit payments are as follows for the years ended December 31, (in thousands): 2023 $ 3,738 2024 3,645 2025 3,808 2026 3,756 2027 3,836 2028-2032 19,388 Total $ 38,171 |
Schedule of Allocation of Plan Assets | The following tables summarize the plan assets of the U.K. Plan measured at fair value on a recurring basis (at least annually) as of December 31, 2022 and 2021 (in thousands): December 31, 2022 Asset Category Total Quoted Prices in Significant Significant Cash $ 1,861 $ 1,861 $ — $ — Equity securities: Diversified growth fund (a) 15,285 — 4,848 10,437 Fixed income securities: U.K. government fixed income securities (b) 6,471 — 6,471 — U.K. government index-linked securities (c) 7,942 — 7,942 — Corporate bonds (e) 25,009 — 25,009 — Total $ 56,568 $ 1,861 $ 44,270 $ 10,437 December 31, 2021 Asset Category Total Quoted Prices in Significant Significant Cash $ 2,411 $ 2,411 $ — $ — Equity securities: Diversified growth fund (a) 23,582 — 12,139 11,443 Fixed income securities: U.K. government fixed income securities (b) 9,487 — 9,487 — U.K. government index-linked securities (c) 16,393 — 16,393 — Global absolute return bond fund (d) 12,111 — 12,111 — Corporate bonds (e) 30,297 — 30,297 — Total $ 94,281 $ 2,411 $ 80,427 $ 11,443 a) This category includes investments in a diversified portfolio of equity, alternatives and cash markets that aims to achieve capital growth returns. b) This category includes investments in funds with the objective to provide a leveraged return to U.K. government fixed income securities (bonds) that have maturity periods ranging from 2030 to 2060. c) This category includes investments in funds with the objective to provide a leveraged return to various U.K. government indexed-linked securities (gilts), with maturity periods ranging from 2027 to 2062. The funds invest in U.K. government bonds and derivatives. d) This category includes investments in funds predominantly in a wide range of fixed and floating rate investment grade and below investment grade debt instruments traded on regulated markets worldwide with the objective to achieve a return of 3% above 1 month LIBOR over a 3-year basis. e) This category includes investments in a diversified pool of debt and debt like assets to generate capital and income returns. The following table sets forth the weighted-average asset allocation and target asset allocations as of December 31, 2022 and 2021 by asset category: Asset Allocations Target Asset Allocations 2022 2021 2022 2021 Equity securities and diversified growth funds 1 27.0 % 24.9 % 27.5 % 27.5 % Debt securities 2 69.7 % 72.5 % 72.5 % 72.5 % Other 3.3 % 2.6 % — % — % Total 100 % 100 % 100 % 100 % ______________________________ 1 Diversified growth funds refer to actively managed absolute return funds that hold a combination of equity and debt securities. 2 Includes investments in funds with the objective to provide leveraged returns to U.K. government fixed income securities, U.K. government indexed-linked securities, global bonds, and corporate bonds. |
Schedule of Changes in the Fair Value Measurements of Level 3 Investments | The following table summarizes the changes in the fair value measurements of Level 3 investments for the pension plans (in thousands): December 31, 2022 December 31, 2021 Balance at beginning of year $ 11,443 $ 9,752 Actual return on plan assets 195 1,790 Purchases/ sales/ settlements — — Transfer in/out of level 3 — — Changes due to foreign exchange (1,201) (99) Balance at end of year $ 10,437 $ 11,443 |
SEGMENT AND GEOGRAPHIC DISCLO_2
SEGMENT AND GEOGRAPHIC DISCLOSURES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Data for our Three Operating Segments | Segment data for our two operating segments are as follows (in thousands): Twelve Months Ended 2022 2021 Revenues: IHT $ 422,562 $ 415,371 MS 417,646 378,826 Total Revenues $ 840,208 $ 794,197 Twelve Months Ended 2022 2021 Operating income (loss): IHT $ 17,093 $ 12,997 MS 1 20,930 (47,728) Corporate and shared support services (77,825) (92,151) Total Operating income (loss) $ (39,802) $ (126,882) ______________ 1 Includes goodwill impairment loss of $55.8 million for MS for the year ended December 31, 2021. Twelve Months Ended 2022 2021 Capital expenditures 1 : IHT $ 13,939 $ 11,742 MS 5,013 3,692 Corporate and shared support services 84 1,464 Total Capital expenditures $ 19,036 $ 16,898 ______________ 1 Excludes finance leases. Totals may vary from amounts presented in the consolidated statements of cash flows due to the timing of cash payments. Twelve Months Ended 2022 2021 Depreciation and amortization: IHT $ 12,391 $ 12,959 MS 19,021 20,500 Corporate and shared support services 5,041 5,443 Total Depreciation and amortization $ 36,453 $ 38,902 |
Geographic Breakdown of Revenues and Total Long-Lived Assets | A geographic breakdown of our revenues for the years ended December 31, 2022 and 2021 and our total long-lived assets as of December 31, 2022 and 2021 are as follows (in thousands): Total Revenues 1 Total Long-lived Assets 2 Twelve months ended December 31, 2022 United States $ 613,021 $ 240,088 Canada 95,790 4,708 Europe 61,713 14,591 Other foreign countries 69,684 2,581 Total $ 840,208 $ 261,968 Twelve months ended December 31, 2021 United States $ 561,416 $ 261,540 Canada 100,397 7,290 Europe 66,926 19,619 Other foreign countries 65,458 3,845 Total $ 794,197 $ 292,294 ______________ 1 Revenues attributable to individual countries/geographic areas are based on the country of domicile of the legal entity that performs the work. |
RESTRUCTURING AND OTHER RELAT_2
RESTRUCTURING AND OTHER RELATED CHARGES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Our restructuring and other related charges, net for the years ended December 31, 2022 and 2021 are summarized by segment as follows (in thousands): Twelve Months Ended December 31, 2022 2021 Operating Group Reorganization and other restructuring measures Severance and related costs IHT $ 16 $ 459 MS — 514 Corporate and shared support services — 1,562 Total $ 16 $ 2,535 |
Schedule of Restructuring Reserve | A rollforward of our accrued severance liability associated with our ongoing cost reduction efforts is presented below (in thousands): Twelve Months Ended Balance, beginning of period $ 712 Charges 3,961 Payments (2,734) Balance, end of period $ 1,939 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Additional Information (Details) | 2 Months Ended | 10 Months Ended | 12 Months Ended | ||||||||
Nov. 01, 2022 USD ($) Segment | Feb. 11, 2022 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) segment profile | Oct. 31, 2022 segment | Dec. 31, 2022 USD ($) segment profile | Dec. 31, 2021 USD ($) | Jan. 31, 2023 USD ($) | Jan. 31, 2022 USD ($) | Dec. 31, 2020 USD ($) | Jul. 31, 2017 USD ($) | ||
Significant Accounting Policies [Line Items] | |||||||||||
Number of operating segments | 2 | 2 | 3 | 2 | |||||||
Number of client demand profiles | profile | 3 | 3 | |||||||||
Repayment of principal debt balance | $ 225,000,000 | ||||||||||
Deferred employer payroll taxes | $ 14,100,000 | $ 7,000,000 | |||||||||
Selling, general and administrative expenses | $ 241,397,000 | 246,206,000 | |||||||||
Goodwill | $ 0 | 0 | 0 | ||||||||
Goodwill impairment charge (see Note 9) | [1] | 0 | 64,632,000 | ||||||||
Deferred tax assets, gross | 94,680,000 | 94,680,000 | 119,776,000 | ||||||||
Valuation allowance | 73,483,000 | 73,483,000 | 89,191,000 | ||||||||
Deferred tax liabilities | 24,483,000 | 24,483,000 | 33,978,000 | ||||||||
Unrecognized tax benefits | 1,097,000 | 1,097,000 | 1,285,000 | $ 1,610,000 | |||||||
Workers compensation our self-insured retention | 1,000,000 | ||||||||||
Automobile liability self-insured retention | 2,000,000 | ||||||||||
Professional liability claims self insured retention | 2,000,000 | ||||||||||
General liability claims we have an effective self-insured retention | 1,000,000 | ||||||||||
General liability claims, deductible per occurrence | 4,000,000 | 4,000,000 | |||||||||
Environmental liability claims, our self-insured retention | 1,000,000 | ||||||||||
Medical claims, our self-insured retention | 350,000 | ||||||||||
Unamortized warrant discount | 29,200,000 | 29,200,000 | 3,300,000 | ||||||||
Accrued capital expenditures | 2,400,000 | 3,900,000 | |||||||||
PIPE Shares | |||||||||||
Significant Accounting Policies [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 | ||||||||||
Secured Debt | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Debt, face amount | $ 55,000,000 | ||||||||||
Secured Debt | Delayed Draw Term Loan | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Debt, face amount | $ 35,000,000 | ||||||||||
Convertible debt | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Debt, face amount | 41,200,000 | 41,200,000 | $ 230,000,000 | ||||||||
Periodic payment | 10,000,000 | ||||||||||
Fair value of convertible senior notes | 10,000,000 | 10,000,000 | |||||||||
Convertible debt | Significant Observable Inputs (Level 2) | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Fair value of convertible senior notes | 37,500,000 | 37,500,000 | 84,000,000 | ||||||||
Letter of Credit | Line of Credit | ABL Facility | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Borrowing under credit facility | 8,700,000 | 8,700,000 | |||||||||
COVID-19 | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Deferred employer payroll taxes | $ 2,100,000 | 2,100,000 | 3,200,000 | ||||||||
Operating expenses | 600,000 | 6,200,000 | |||||||||
Selling, general and administrative expenses | $ 100,000 | 1,500,000 | |||||||||
Subsequent Event | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Deferred employer payroll taxes | $ 6,600,000 | ||||||||||
Discontinued Operations | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Deferred employer payroll taxes | $ 500,000 | ||||||||||
Goodwill impairment charge (see Note 9) | 8,800,000 | ||||||||||
Quest Integrity Group | |||||||||||
Significant Accounting Policies [Line Items] | |||||||||||
Purchase and sale agreement, consideration | 279,000,000 | ||||||||||
Repayments of debt | $ 238,000,000 | ||||||||||
Accrued capital expenditures | $ 100,000 | ||||||||||
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Estimated Useful Lives of Assets (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Enterprise Resource Planning (“ERP”) System | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 15 years |
Minimum | Buildings | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 20 years |
Minimum | Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 2 years |
Minimum | Machinery and equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 2 years |
Minimum | Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 2 years |
Minimum | Computers and computer software | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 2 years |
Minimum | Automobiles | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 2 years |
Maximum | Buildings | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 40 years |
Maximum | Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 15 years |
Maximum | Machinery and equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 12 years |
Maximum | Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 10 years |
Maximum | Computers and computer software | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 5 years |
Maximum | Automobiles | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES - Non-Cash Investing and Financing Activities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
Assets acquired under finance lease | $ 1,270 | $ 1,011 |
DISCONTINUED OPERATIONS - Addit
DISCONTINUED OPERATIONS - Additional Information (Details) $ in Millions | 2 Months Ended | 10 Months Ended | 12 Months Ended | ||
Nov. 01, 2022 USD ($) Segment | Dec. 31, 2022 segment | Oct. 31, 2022 segment | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Repayment of principal debt balance | $ 225 | ||||
Number of operating segments | 2 | 2 | 3 | 2 | |
Accrued capital expenditures | $ 2.4 | $ 3.9 | |||
Quest Integrity Group | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Purchase and sale agreement, consideration | $ 279 | ||||
Net proceeds used to pay down term debt | $ 238 | ||||
Accrued capital expenditures | $ 0.1 |
DISCONTINUED OPERATIONS - Sched
DISCONTINUED OPERATIONS - Schedule of Discontinued Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Major classes of line items constituting net income (loss) from discontinued operations | ||
Goodwill impairment charge | $ 0 | $ (8,795) |
Net income (loss) from discontinued operations | 220,166 | (1,174) |
Carrying amounts of major classes of liabilities included as part of discontinued operations: | ||
Income tax payable | 1,939 | |
Quest Integrity Group | ||
Major classes of line items constituting net income (loss) from discontinued operations | ||
Revenues | 101,418 | 80,356 |
Operating expenses | (45,044) | (43,616) |
Selling, general and administrative expenses | (32,230) | (26,663) |
Restructuring and other related charges, net | 0 | (381) |
Interest expense, net | (108) | (230) |
Other (expense) | (4,390) | |
Other income | 591 | |
Income before income taxes | 19,646 | 1,262 |
Gain on sale of Quest Integrity | 203,351 | 0 |
Income before income taxes | 222,997 | 1,262 |
Provision for income taxes | (2,831) | (2,436) |
Net income (loss) from discontinued operations | 220,166 | (1,174) |
Carrying amount of major classes of assets included as part of discontinued operations: | ||
Cash and cash equivalents | 10,122 | |
Accounts receivable, net | 20,499 | |
Prepaid expenses and other current assets | 3,805 | |
Property, plant and equipment, net | 15,879 | |
Goodwill and intangible assets, net | 26,823 | |
Other classes of assets that are not major | 5,968 | |
Total assets associated with discontinued operations | 83,096 | |
Carrying amounts of major classes of liabilities included as part of discontinued operations: | ||
Accounts payable | 2,125 | |
Other accrued liabilities | 9,363 | |
Operating lease obligations | 2,368 | |
Other classes of liabilities that are not major | 601 | |
Total liabilities associated with discontinued operations | 16,396 | |
Cash flows provided by operating activities of discontinued operations: | ||
Depreciation and amortization | 1,141 | 2,616 |
Cash flows provided by investing activities of discontinued operations: | ||
Capital expenditures | $ 4,146 | $ 3,500 |
REVENUE - Disaggregation of Rev
REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 840,208 | $ 794,197 |
Non-Destructive Evaluation and Testing Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 336,821 | 325,204 |
Repair and Maintenance Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 413,604 | 375,352 |
Heat Treating | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 61,802 | 60,661 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 27,981 | 32,980 |
IHT | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 422,562 | 415,371 |
IHT | Non-Destructive Evaluation and Testing Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 336,821 | 325,204 |
IHT | Repair and Maintenance Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 180 | 467 |
IHT | Heat Treating | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 61,526 | 59,855 |
IHT | Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 24,035 | 29,845 |
MS | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 417,646 | 378,826 |
MS | Non-Destructive Evaluation and Testing Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 0 | 0 |
MS | Repair and Maintenance Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 413,424 | 374,885 |
MS | Heat Treating | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 276 | 806 |
MS | Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 3,946 | 3,135 |
United States and Canada | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 708,812 | 661,813 |
United States and Canada | IHT | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 412,661 | 405,007 |
United States and Canada | MS | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 296,151 | 256,806 |
Other Countries | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 131,396 | 132,384 |
Other Countries | IHT | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 9,901 | 10,364 |
Other Countries | MS | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 121,495 | $ 122,020 |
REVENUE - Contract Balances (De
REVENUE - Contract Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |||
Trade accounts receivable, net | $ 186,689 | $ 168,273 | |
Contract assets | 2 | [1] | 2 |
Contract liabilities | $ 0 | [2] | $ 80 |
[1]Included in the “Prepaid expenses and other current assets” line on the consolidated balance sheet.[2]Included in the “Other accrued liabilities” line of the consolidated balance sheet. |
RECEIVABLES - Summary of Accoun
RECEIVABLES - Summary of Accounts Receivable (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Receivables [Abstract] | |||
Trade accounts receivable | $ 160,572 | $ 142,975 | |
Unbilled revenues | 31,379 | 33,141 | |
Allowance for credit losses | (5,262) | (7,843) | $ (9,115) |
Accounts receivable, net | $ 186,689 | $ 168,273 | |
Payment terms | 30 days |
RECEIVABLES - Summary of Activi
RECEIVABLES - Summary of Activity in Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of period | $ 7,843 | $ 9,115 |
Provision for expected credit losses | 1,059 | 2,332 |
Recoveries collected | (1,114) | (369) |
Write-offs | (2,479) | (3,201) |
Foreign exchange effects | (47) | (34) |
Balance at end of period | $ 5,262 | $ 7,843 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 8,978 | $ 7,576 |
Work in progress | 2,945 | 2,725 |
Finished goods | 24,408 | 25,074 |
Inventory | $ 36,331 | $ 35,375 |
PREPAID AND OTHER CURRENT ASS_3
PREPAID AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Insurance receivable | $ 39,000 | $ 39,000 |
Prepaid expenses | 15,238 | 10,542 |
Other current assets | 11,441 | 6,521 |
Prepaid expenses and other current assets | 65,679 | 56,063 |
Debt issuance costs, current, net | 3,100 | |
Debt issuance costs, net | 15,100 | $ 58,000 |
1970 Group | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Debt issuance costs, net | $ 1,800 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | $ 431,355 | $ 428,152 |
Accumulated depreciation and amortization | (293,256) | (282,672) |
Property, plant, and equipment, net | 138,099 | 145,480 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | 4,006 | 5,227 |
Buildings and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | 50,833 | 54,597 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | 277,852 | 278,828 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | 10,558 | 10,704 |
Capitalized ERP system development costs | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | 45,917 | 45,916 |
Computers and computer software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | 19,457 | 17,993 |
Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | 3,536 | 3,540 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant, and equipment | $ 19,196 | $ 11,347 |
PROPERTY, PLANT AND EQUIPMENT -
PROPERTY, PLANT AND EQUIPMENT - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Long-Lived Assets Held-for-sale [Line Items] | ||
Assets under finance leases | $ 7.4 | $ 6.7 |
Accumulated amortization for assets under finance leases | 2.3 | 1.6 |
Depreciation expense | 22.9 | 25.4 |
Assets sold and disposed, cost basis | (2.5) | (0.8) |
Gain (loss) on sale of property, plant and equipment | 4.2 | $ 0 |
Machinery and equipment | ||
Long-Lived Assets Held-for-sale [Line Items] | ||
Assets sold and disposed, cost basis | (0.3) | |
Buildings | ||
Long-Lived Assets Held-for-sale [Line Items] | ||
Assets sold and disposed, cost basis | (0.9) | |
Land | ||
Long-Lived Assets Held-for-sale [Line Items] | ||
Assets sold and disposed, cost basis | $ (1.3) |
INTANGIBLE ASSETS - Summary of
INTANGIBLE ASSETS - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 206,605 | $ 206,897 |
Accumulated Amortization | (131,198) | (118,579) |
Net Carrying Amount | 75,407 | 88,318 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 165,231 | 165,381 |
Accumulated Amortization | (91,296) | (79,081) |
Net Carrying Amount | 73,935 | 86,300 |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 4,281 | 4,357 |
Accumulated Amortization | (4,281) | (4,357) |
Net Carrying Amount | 0 | 0 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 20,563 | 20,590 |
Accumulated Amortization | (19,830) | (19,606) |
Net Carrying Amount | 733 | 984 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,707 | 2,731 |
Accumulated Amortization | (1,978) | (1,773) |
Net Carrying Amount | 729 | 958 |
Licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 840 | 850 |
Accumulated Amortization | (830) | (774) |
Net Carrying Amount | 10 | 76 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 12,983 | 12,988 |
Accumulated Amortization | (12,983) | (12,988) |
Net Carrying Amount | $ 0 | $ 0 |
INTANGIBLE ASSETS - Additional
INTANGIBLE ASSETS - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization expense | $ 12.9 | $ 12.9 |
Intangible assets, amortization expense, 2023 | 12.2 | |
Intangible assets, amortization expense, 2024 | 12.2 | |
Intangible assets, amortization expense, 2025 | 12.2 | |
Intangible assets, amortization expense, 2026 | $ 12.2 | |
Intangible assets, estimated weighted average useful life | 13 years 8 months 12 days | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, estimated weighted average useful life | 13 years 8 months 12 days | |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, estimated weighted average useful life | 13 years 2 months 12 days | |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, estimated weighted average useful life | 10 years | |
Licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, estimated weighted average useful life | 10 years 6 months |
GOODWILL AND IMPAIRMENT CHARG_2
GOODWILL AND IMPAIRMENT CHARGES - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Goodwill [Line Items] | |||
Goodwill impairment charges | [1] | $ 0 | $ 64,632,000 |
Goodwill impairment, continuing operations | $ 0 | (55,837,000) | |
MS | |||
Goodwill [Line Items] | |||
Goodwill impairment charges | 55,800,000 | ||
Goodwill impairment, continuing operations | (55,800,000) | ||
Quest Integrity Group | |||
Goodwill [Line Items] | |||
Goodwill impairment, discontinued operations | $ (8,800,000) | ||
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
OTHER ACCRUED LIABILITIES (Deta
OTHER ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Payroll and other compensation expenses | $ 48,507 | $ 39,599 |
Legal and professional accruals | 46,665 | 46,762 |
Insurance accruals | 7,483 | 7,181 |
Property, sales and other non-income related taxes | 7,348 | 6,553 |
Accrued interest | 3,963 | 6,469 |
Volume discount | 2,050 | 1,902 |
Other accruals | 3,251 | 3,270 |
Other accrued liabilities | $ 119,267 | $ 111,736 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax [Line Items] | |||
Effective tax rate | 2.30% | 5% | |
Income tax provision (benefit) | $ 3,306 | $ 8,773 | |
Valuation allowance | $ 73,483 | $ 73,483 | $ 89,191 |
Valuation allowance based on all available evidence, including forecasted income | 11,500 | ||
US Federal income tax rate | 21% | 21% | |
Deferred tax liabilities, undistributed foreign earnings | 2,600 | $ 2,600 | |
Liabilities for uncertain tax positions | 1,700 | 1,700 | |
Income tax examination, liability | 500 | 500 | |
Unrecognized tax benefits, income tax penalties and interest accrued | 600 | 600 | $ 600 |
Unrecognized tax benefits, income tax penalties and interest expense | 0 | $ 200 | |
Alternative Minimum Tax | |||
Income Tax [Line Items] | |||
Tax credit carryforward | 120,600 | 120,600 | |
Indefinite | Alternative Minimum Tax | |||
Income Tax [Line Items] | |||
Tax credit carryforward | 120,600 | 120,600 | |
Expires in 2037 | |||
Income Tax [Line Items] | |||
Tax credit carryforward | 2,200 | 2,200 | |
Foreign Tax | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 25,100 | 25,100 | |
Foreign Tax | Indefinite | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 23,300 | 23,300 | |
Foreign Tax | Expires in 2030 | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 1,800 | 1,800 | |
Federal | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 104,200 | 104,200 | |
Federal | Expires in 2036 and 2037 | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 3,700 | 3,700 | |
Federal | Indefinite | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 100,500 | 100,500 | |
State | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 178,600 | 178,600 | |
State | Indefinite | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 22,100 | 22,100 | |
State | Expires in 2041 | |||
Income Tax [Line Items] | |||
Net operating loss carryforwards | 156,500 | 156,500 | |
Germany and Canada Subsisdaries | Foreign Tax | |||
Income Tax [Line Items] | |||
Valuation allowance | $ 2,200 | $ 2,200 |
INCOME TAXES - Components of Ta
INCOME TAXES - Components of Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current | ||
U.S. Federal | $ (211) | $ 938 |
State & local | 513 | 590 |
Foreign jurisdictions | 1,319 | 2,494 |
Total current, provision for income tax | 1,621 | 4,022 |
Deferred | ||
U.S. Federal | 0 | (1,115) |
State & local | 0 | 150 |
Foreign jurisdictions | 1,685 | 5,716 |
Total deferred, provision for income tax | 1,685 | 4,751 |
Total | ||
U.S. Federal | (211) | (177) |
State & local | 513 | 740 |
Foreign jurisdictions | 3,004 | 8,210 |
Total expense (benefit) for income tax on continuing operations | $ 3,306 | $ 8,773 |
INCOME TAXES - Components of Pr
INCOME TAXES - Components of Pre-Tax Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Domestic | $ (156,001) | $ (171,299) |
Foreign | 9,220 | (4,773) |
Loss before income taxes | $ (146,781) | $ (176,072) |
INCOME TAXES - Income Tax Rate
INCOME TAXES - Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Pre-tax loss from continuing operations | $ (146,781) | $ (176,072) |
Computed income taxes at statutory rate | (30,824) | (36,975) |
State income taxes, net of federal benefit | 395 | 561 |
Foreign tax rate differential | 701 | 1,380 |
Non-cash compensation | 228 | 320 |
Deferred taxes on investment in foreign subsidiaries | 0 | (1,939) |
Non-deductible expenses | 118 | 229 |
Foreign withholding | 693 | 1,078 |
Prior year tax adjustments | 7 | 141 |
Goodwill impairment | 0 | 9,399 |
Valuation allowance | 31,430 | 34,284 |
Rate change | 0 | (140) |
Other | 558 | 435 |
Total expense (benefit) for income tax on continuing operations | $ 3,306 | $ 8,773 |
INCOME TAXES - Deferred Tax Ass
INCOME TAXES - Deferred Tax Assets and Deferred Tax Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Accrued compensation and benefits | $ 7,630 | $ 7,831 |
Receivables | 552 | 1,345 |
Inventory | 296 | 316 |
Share based compensation | 258 | 271 |
Other accrued liabilities | 2,940 | 3,467 |
Tax credit carry forward | 2,314 | 3,613 |
Interest expense limitation | 28,137 | 22,312 |
Goodwill and intangible costs | 10,143 | 9,221 |
Convertible debt | 1,780 | 0 |
Net operating loss carry forwards | 38,860 | 68,972 |
Other | 1,770 | 2,428 |
Deferred tax assets | 94,680 | 119,776 |
Less: Valuation allowance | (73,483) | (89,191) |
Deferred tax assets, net | 21,197 | 30,585 |
Deferred tax liabilities: | ||
Property, plant and equipment | (17,642) | (20,267) |
Unremitted earnings of foreign subsidiaries | (3,581) | (3,944) |
Convertible debt | 0 | (7,359) |
Other | (3,260) | (2,408) |
Deferred tax liabilities | (24,483) | (33,978) |
Net deferred tax asset (liability) | $ (3,286) | $ (3,393) |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Unrecognized tax benefits - January 1 | $ 1,285 | $ 1,610 |
Additions based on current year tax positions | 0 | 0 |
Additions based on tax positions related to prior years | 350 | 543 |
Reductions based on tax positions related to prior years | 0 | 0 |
Disposition of uncertain tax positions of discontinued operations | (426) | 0 |
Settlements | 0 | 0 |
Reductions resulting from a lapse of the applicable statute of limitations | (112) | (868) |
Unrecognized tax benefits - December 31 | $ 1,097 | $ 1,285 |
DEBT - Long-Term Debt Balances
DEBT - Long-Term Debt Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 239,383 | $ 312,549 |
Finance lease obligations | 5,902 | 5,640 |
Total long-term debt and finance lease obligations | 285,935 | 405,851 |
Current portion of long-term debt and finance lease obligations | (280,993) | (667) |
Total long-term debt and finance lease obligations, less current portion | 4,942 | 405,184 |
Secured Debt | APSC Term Loan | ||
Debt Instrument [Line Items] | ||
Long-term debt | 31,562 | 214,191 |
Subordinated Debt | Subordinated Term Loan | ||
Debt Instrument [Line Items] | ||
Long-term debt | 107,905 | 36,358 |
Convertible debt | ||
Debt Instrument [Line Items] | ||
Long-term debt | 40,650 | 87,662 |
Revolving Credit Facility | 2020 ABL Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | 0 | 62,000 |
Revolving Credit Facility | 2022 ABL Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 99,916 | $ 0 |
DEBT - ABL Facility, Additional
DEBT - ABL Facility, Additional Information (Details) | 12 Months Ended | ||||||||
Nov. 01, 2022 | Oct. 31, 2022 | May 06, 2022 | May 05, 2022 | Feb. 11, 2022 USD ($) borrowing | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 18, 2020 USD ($) | Jul. 31, 2017 USD ($) | |
Debt Instrument [Line Items] | |||||||||
Debt issuance costs, net | $ 15,100,000 | $ 58,000,000 | |||||||
Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt, face amount | $ 55,000,000 | ||||||||
Convertible debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt, face amount | $ 41,200,000 | $ 230,000,000 | |||||||
Effective interest rate | 7.84% | 9.12% | |||||||
Periodic payment | $ 10,000,000 | ||||||||
Fair value of convertible senior notes | 10,000,000 | ||||||||
ABL Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt issuance costs, net | 8,400,000 | ||||||||
Available borrowing capacity | 52,400,000 | ||||||||
ABL Facility | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt issuance costs, net | 3,100,000 | $ 2,900,000 | |||||||
Delayed Draw Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Available borrowing capacity | $ 10,000,000 | ||||||||
Delayed Draw Term Loan | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt, face amount | $ 35,000,000 | ||||||||
Commitment fees on unused borrowing capacity | 3% | ||||||||
Prepayment trigger percentage | 130% | ||||||||
Number of borrowings | borrowing | 4 | ||||||||
Delayed Draw Term Loan | Secured Debt | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 10% | ||||||||
Floor interest rate | 1% | ||||||||
ABL Eclipse | |||||||||
Debt Instrument [Line Items] | |||||||||
Effective interest rate | 8.77% | ||||||||
Available borrowing capacity | $ 42,400,000 | ||||||||
ABL Corre DDTL | |||||||||
Debt Instrument [Line Items] | |||||||||
Effective interest rate | 14.12% | ||||||||
ABL Corre DDTL | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowing under credit facility | $ 35,000,000 | ||||||||
Letter of Credit | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowing capacity | $ 26,000,000 | ||||||||
Letter of Credit | 2020 ABL Facility | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowing capacity | $ 150,000,000 | ||||||||
Letter of Credit | ABL Facility | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Outstanding principle, days prior to maturity | 75 days | 45 days | 120 days | 75 days | |||||
Borrowing under credit facility | 8,700,000 | ||||||||
Available borrowing capacity | 52,400,000 | ||||||||
Letter of Credit | Delayed Draw Term Loan | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Available borrowing capacity | 10,000,000 | ||||||||
Letter of Credit | ABL Eclipse | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Available borrowing capacity | 42,400,000 | ||||||||
Revolving Credit Facility | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowing capacity | $ 130,000,000 | ||||||||
Commitment fees on unused borrowing capacity | 0.50% | ||||||||
Maximum unfinanced capital expenditures | $ 20,000,000 | ||||||||
Covenant, leverage ratio, maximum | 4 | ||||||||
Increase in interest rate in event of default | 2% | ||||||||
Revolving Credit Facility | Line of Credit | Debt Instrument, Redemption, Period One | |||||||||
Debt Instrument [Line Items] | |||||||||
Prepayment fee percent | 2% | ||||||||
Revolving Credit Facility | Line of Credit | Debt Instrument, Redemption, Period Two | |||||||||
Debt Instrument [Line Items] | |||||||||
Prepayment fee percent | 1% | ||||||||
Revolving Credit Facility | Line of Credit | Debt Instrument, Redemption, Period Three | |||||||||
Debt Instrument [Line Items] | |||||||||
Prepayment fee percent | 0.50% | ||||||||
Revolving Credit Facility | Line of Credit | Fed Funds Effective Rate Overnight Index Swap Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 0.50% | ||||||||
Revolving Credit Facility | Line of Credit | Base Rate | |||||||||
Debt Instrument [Line Items] | |||||||||
Floor interest rate | 2% | ||||||||
Revolving Credit Facility | Line of Credit | Base Rate | Variable Rate Component One | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 3.15% | ||||||||
Revolving Credit Facility | Line of Credit | Base Rate | Variable Rate Component Two | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 3.40% | ||||||||
Revolving Credit Facility | Line of Credit | Base Rate | Variable Rate Component Three | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 3.65% | ||||||||
Revolving Credit Facility | Line of Credit | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Floor interest rate | 1% | ||||||||
Revolving Credit Facility | Line of Credit | LIBOR | Variable Rate Component One | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 4.15% | ||||||||
Revolving Credit Facility | Line of Credit | LIBOR | Variable Rate Component Two | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 4.40% | ||||||||
Revolving Credit Facility | Line of Credit | LIBOR | Variable Rate Component Three | |||||||||
Debt Instrument [Line Items] | |||||||||
Basis spread on variable rate | 4.65% | ||||||||
Revolving Credit Facility | ABL Eclipse | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowing under credit facility | $ 64,900,000 | ||||||||
Bridge Loan | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowing capacity | $ 35,000,000 |
DEBT - APSC Term Loan, Addition
DEBT - APSC Term Loan, Additional Information (Details) | 12 Months Ended | |||||||||||||||
Nov. 02, 2022 USD ($) $ / shares shares | Nov. 01, 2022 USD ($) | May 06, 2022 USD ($) | May 05, 2022 | Dec. 18, 2020 USD ($) $ / shares | Dec. 31, 2022 USD ($) $ / shares | Dec. 31, 2021 USD ($) $ / shares | Dec. 18, 2026 USD ($) | Nov. 04, 2022 | May 10, 2022 | Feb. 11, 2022 USD ($) | Dec. 08, 2021 $ / shares shares | Nov. 09, 2021 $ / shares shares | Nov. 08, 2021 USD ($) $ / shares shares | Nov. 07, 2021 USD ($) | Dec. 31, 2020 $ / shares shares | |
Debt Instrument [Line Items] | ||||||||||||||||
Interest expense, net | $ 85,052,000 | $ 46,079,000 | ||||||||||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 7.75 | $ 7.75 | ||||||||||||||
Repayment of principal debt balance | $ 225,000,000 | |||||||||||||||
Gain (loss) on debt extinguishment | $ (30,083,000) | $ 0 | ||||||||||||||
APSC Term Loan | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt, face amount | $ 35,500,000 | $ 10,000,000 | $ 250,000,000 | $ 10,000,000 | $ 50,000,000 | |||||||||||
Debt instrument, interest rate, original issue discount | 3% | |||||||||||||||
Proceeds from issuance of debt | $ 242,500,000 | |||||||||||||||
Line of credit facility, increase limit | $ 100,000,000 | |||||||||||||||
Make whole period | 2 years | |||||||||||||||
Effective interest rate | 37.99% | 20.90% | ||||||||||||||
Unamortized discount and debt issuance costs | $ 3,900,000 | $ 35,800,000 | ||||||||||||||
Interest expense, net | $ 21,800,000 | $ 21,900,000 | ||||||||||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 7.75 | $ 15 | $ 1.50 | $ 1.50 | $ 1.50 | |||||||||||
Covenant, leverage ratio, maximum | 7 | 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 | ||||||||||||||
Gain (loss) on debt extinguishment | (30,100,000) | $ 30,100,000 | ||||||||||||||
Loss on extinguishment premium and fees | 12,400,000 | 12,400,000 | ||||||||||||||
Write off of debt issuance cost and debt discount | $ 17,700,000 | $ 17,700,000 | ||||||||||||||
APSC Term Loan | Quest Integrity Group | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Proceeds allowed to retain from disposition of business | 26,000,000 | |||||||||||||||
Minimum outstanding balance affecting maturity trigger date | $ 10,000,000 | |||||||||||||||
APSC Term Loan | APSC Warrant | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | shares | 500,000 | 4,082,949 | 1,417,051 | 3,582,949 | ||||||||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 15 | $ 1.50 | ||||||||||||||
APSC Term Loan | A&R Warrant | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | shares | 1,000,000 | 5,000,000 | 4,082,949 | |||||||||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 15 | $ 1.50 | $ 1.50 | $ 1.50 | ||||||||||||
APSC Term Loan | Fed Funds Effective Rate Overnight Index Swap Rate | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Basis spread on variable rate | 0.50% | |||||||||||||||
APSC Term Loan | One Month LIBOR | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Basis spread on variable rate | 1% | |||||||||||||||
APSC Term Loan | Base Rate | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Basis spread on variable rate | 6.50% | |||||||||||||||
APSC Term Loan | Base Rate | Minimum | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Basis spread on variable rate | 2% | |||||||||||||||
APSC Term Loan | LIBOR | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Basis spread on variable rate | 7.50% | |||||||||||||||
APSC Term Loan | LIBOR | Minimum | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Basis spread on variable rate | 1% | |||||||||||||||
APSC Term Loan | Variable Interest Rate | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Effective interest rate | 11.73% | 8.50% | ||||||||||||||
APSC Term Loan | Accelerated Debt Issue Costs | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Effective interest rate | 26.26% | 12.40% | ||||||||||||||
APSC Term Loan | Forecasted | ||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||
Debt, face amount | $ 10,000,000 |
DEBT - Subordinated Term Loan (
DEBT - Subordinated Term Loan (Details) | 12 Months Ended | |||||||||||||||||
Nov. 01, 2022 USD ($) | Feb. 11, 2022 USD ($) $ / shares shares | Dec. 08, 2021 USD ($) | Nov. 09, 2021 USD ($) director | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Nov. 21, 2022 USD ($) | Nov. 04, 2022 | Nov. 02, 2022 USD ($) | Oct. 04, 2022 USD ($) | Jun. 28, 2022 USD ($) | May 10, 2022 | May 09, 2022 | May 06, 2022 USD ($) | Nov. 08, 2021 USD ($) | Nov. 07, 2021 USD ($) | Dec. 18, 2020 USD ($) | Jul. 31, 2017 USD ($) | |
Debt Instrument [Line Items] | ||||||||||||||||||
Interest expense, net | $ 85,052,000 | $ 46,079,000 | ||||||||||||||||
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 | |||||||||||||||||
Secured Debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt, face amount | $ 55,000,000 | |||||||||||||||||
Convertible debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt, face amount | $ 41,200,000 | $ 230,000,000 | ||||||||||||||||
Interest rate | 5% | 5% | ||||||||||||||||
Effective interest rate | 7.84% | 9.12% | ||||||||||||||||
Unamortized debt issuance costs | $ 377,000 | $ 916,000 | ||||||||||||||||
Interest expense, net | $ 8,105,000 | $ 7,786,000 | ||||||||||||||||
Subordinated Term Loan | Quest Integrity Group | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Proceeds allowed to retain from disposition of business | $ 26,000,000 | |||||||||||||||||
Subordinated Term Loan | Subordinated Debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt, face amount | $ 50,000,000 | $ 112,700,000 | ||||||||||||||||
Proceeds from debt | $ 27,500,000 | $ 22,500,000 | ||||||||||||||||
Interest rate | 12% | 12% | 12% | |||||||||||||||
Effective interest rate | 29.23% | 45.53% | ||||||||||||||||
Unamortized debt issuance costs | $ 7,500,000 | $ 13,900,000 | ||||||||||||||||
Interest expense, net | $ 11,400,000 | $ 600,000 | ||||||||||||||||
Number of directors | director | 7 | |||||||||||||||||
Subordinated Term Loan | Subordinated Debt | Accelerated Debt Issue Costs | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Effective interest rate | 17.23% | 33.53% | ||||||||||||||||
Delayed Draw Term Loan | Subordinated Debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt, face amount | $ 10,000,000 | $ 10,000,000 | $ 10,000,000 | $ 10,000,000 | ||||||||||||||
Covenant, leverage ratio, maximum | 7 | 12 | ||||||||||||||||
Maximum unfinanced capital expenditures | $ 20,000,000 | |||||||||||||||||
Maximum net leverage ratio threshold | 4 | |||||||||||||||||
Delayed Draw Term Loan | Secured Debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt, face amount | $ 35,000,000 | |||||||||||||||||
APSC Term Loan | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt, face amount | $ 35,500,000 | $ 10,000,000 | $ 10,000,000 | $ 50,000,000 | $ 250,000,000 | |||||||||||||
Effective interest rate | 37.99% | 20.90% | ||||||||||||||||
Interest expense, net | $ 21,800,000 | $ 21,900,000 | ||||||||||||||||
Covenant, leverage ratio, maximum | 7 | 7 | 12 | |||||||||||||||
Maximum unfinanced capital expenditures | $ 20,000,000 | |||||||||||||||||
Maximum net leverage ratio threshold | 4 | |||||||||||||||||
APSC Term Loan | Quest Integrity Group | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Proceeds allowed to retain from disposition of business | $ 26,000,000 | |||||||||||||||||
APSC Term Loan | Accelerated Debt Issue Costs | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Effective interest rate | 26.26% | 12.40% |
DEBT - Warrants (Details)
DEBT - Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 08, 2021 | Nov. 09, 2021 | Dec. 31, 2020 | Dec. 18, 2020 |
Debt Instrument [Line Items] | ||||||
Class of warrant or right, outstanding (in shares) | 1,000,000 | 10,000,000 | 3,582,949 | |||
Class of warrant or right, exercise price (in dollars per share) | $ 7.75 | $ 7.75 | ||||
Total value of stock | $ 15,000 | |||||
APSC Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Class of warrant or right, outstanding (in shares) | 500,000 | 5,000,000 | 917,051 | 500,000 | 3,582,949 | |
Class of warrant or right, exercise price (in dollars per share) | $ 15 | $ 1.50 | $ 1.50 | $ 1.50 | $ 7.75 | |
Total value of stock | $ 7,500 | |||||
Delayed Draw Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Class of warrant or right, outstanding (in shares) | 500,000 | 5,000,000 | ||||
Class of warrant or right, exercise price (in dollars per share) | $ 15 | $ 1.50 | ||||
Total value of stock | $ 7,500 |
DEBT - Warrants and Subscriptio
DEBT - Warrants and Subscription Agreement (Details) | Feb. 11, 2022 nominee | Dec. 31, 2022 $ / shares shares | Nov. 02, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Dec. 08, 2021 $ / shares shares | Nov. 09, 2021 $ / shares shares | Nov. 08, 2021 $ / shares shares | Dec. 31, 2020 $ / shares shares | Dec. 18, 2020 $ / shares shares |
Debt Instrument [Line Items] | |||||||||
Class of warrant or right, outstanding (in shares) | shares | 1,000,000 | 10,000,000 | 3,582,949 | ||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 7.75 | $ 7.75 | |||||||
Number of qualified nominees | nominee | 1 | ||||||||
PIPE Shares | |||||||||
Debt Instrument [Line Items] | |||||||||
Period to appoint director | 7 days | ||||||||
Minimum percent of shares owned | 10% | ||||||||
APSC Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Class of warrant or right, outstanding (in shares) | shares | 500,000 | 5,000,000 | 917,051 | 500,000 | 3,582,949 | ||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 15 | $ 1.50 | $ 1.50 | $ 1.50 | $ 7.75 | ||||
A&R Warrant | APSC Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 15 | $ 1.50 | $ 1.50 | $ 1.50 | |||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | shares | 1,000,000 | 5,000,000 | 4,082,949 | ||||||
APSC Warrant | APSC Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Class of warrant or right, exercise price (in dollars per share) | $ / shares | $ 15 | $ 1.50 | |||||||
Class of warrant or right, number of securities called by warrants or rights (in shares) | shares | 500,000 | 4,082,949 | 1,417,051 | 3,582,949 |
DEBT - Convertible Debt, Additi
DEBT - Convertible Debt, Additional Information (Details) | 12 Months Ended | ||||
Oct. 04, 2022 USD ($) | Jul. 31, 2017 USD ($) shares | Dec. 31, 2022 USD ($) day shares $ / shares | Oct. 03, 2022 USD ($) | Jan. 13, 2022 USD ($) | |
Debt Instrument [Line Items] | |||||
Debt instrument, convertible, threshold percentage of conversion price trigger for redemption | 130% | ||||
Debt instrument, convertible, threshold trading days for redemption | day | 20 | ||||
Threshold consecutive trading days for redemption | 30 days | ||||
Convertible debt | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 230,000,000 | $ 41,200,000 | |||
Interest rate | 5% | 5% | |||
Initial conversion rate, convertible debt | 0.0046083 | ||||
Initial conversion price, convertible debt (in dollars per share) | $ / shares | $ 217 | ||||
Threshold trading days | day | 20 | ||||
Threshold consecutive trading days | day | 30 | ||||
Threshold percentage of stock price trigger | 130% | ||||
Number of business days after the specified trading price criteria met that notes may be converted | day | 5 | ||||
Consecutive trading days, trading price criteria | 5 days | ||||
Convertible debt, threshold percentage, product of common stock price and conversion price | 98% | ||||
Number of shares into which debt is convertible (in shares) | shares | 10,599,067 | 189,682 | |||
Shares outstanding, percentage threshold | 19.99% | ||||
Redemption price, percentage (equal to) | 100% | ||||
Repurchase of convertible debt | $ 222,300,000 | ||||
Convertible debt | PIK Securities | |||||
Debt Instrument [Line Items] | |||||
Debt, face amount | $ 41,200,000 | $ 52,000,000 | |||
Interest rate | 5% | 5% | |||
Debt conversion, principle amount | $ 57,000,000 | ||||
Unamortized discount and debt issuance costs | $ 1,400,000 | ||||
Convertible debt | PIK Securities | Minimum | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5% | ||||
Denomination of issuance | $ 1 | ||||
Convertible debt | PIK Securities | Maximum | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 8% | ||||
Denomination of issuance | $ 1,000 |
DEBT - Detail of Convertible De
DEBT - Detail of Convertible Debt Carrying Amount (Details) - USD ($) $ in Thousands | Dec. 31, 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 | 41,162 | 93,130 |
Unamortized issuance costs | (377) | (916) |
Unamortized discount | (135) | (4,552) |
Net carrying amount of the liability component | $ 40,650 | $ 87,662 |
DEBT - Components of Convertibl
DEBT - Components of Convertible Debt Interest Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Debt Instrument [Line Items] | |||
Amortization of debt discount and issuance costs | [1] | $ 35,509 | $ 13,784 |
Total interest expense | 85,052 | 46,079 | |
Convertible debt | |||
Debt Instrument [Line Items] | |||
Coupon interest | 5,700 | 4,657 | |
Amortization of debt discount and issuance costs | 2,405 | 3,129 | |
Total interest expense | $ 8,105 | $ 7,786 | |
Effective interest rate | 7.84% | 9.12% | |
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
DEBT - Cumulative Effect (Detai
DEBT - Cumulative Effect (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Jan. 01, 2022 | |
Liabilities | |||
Long-term debt and finance lease obligations | $ 405,191 | $ 407,018 | |
Equity: | |||
Additional paid-in capital | $ 457,133 | 453,247 | 447,596 |
Accumulated deficit | $ (301,679) | $ (375,584) | $ (371,760) |
Basic (in USD per share) | $ 16.73 | $ (60.05) | |
Diluted (in USD per share) | $ 16.73 | $ (60.05) | |
Cumulative Effect, Period of Adoption, Adjustment | |||
Liabilities | |||
Long-term debt and finance lease obligations | $ 1,827 | ||
Equity: | |||
Additional paid-in capital | (5,651) | ||
Accumulated deficit | $ 3,824 | ||
Interest expense | $ 1,300 | ||
Basic (in USD per share) | $ (0.31) | ||
Diluted (in USD per share) | $ (0.31) |
DEBT - 1970 Group Substitute In
DEBT - 1970 Group Substitute Insurance Reimbursement Facility (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Sep. 29, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Debt Instrument [Line Items] | ||||
Payments of debt issuance costs | [1] | $ 13,709 | $ 10,457 | |
Debt issuance costs, net | 15,100 | $ 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 | $ 1,800 | |||
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
DEBT - Deferred Financing Costs
DEBT - Deferred Financing Costs, Debt and Warrant Discounts and Debt Issuance Cost (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | ||
Debt issuance costs, net | $ 15.1 | $ 58 |
Debt issuance costs expense | $ 21.8 |
DEBT - Loss on Debt Extinguishm
DEBT - Loss on Debt Extinguishment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 02, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||
Loss on debt extinguishment | $ (30,083) | $ 0 | |
APSC Term Loan | |||
Debt Instrument [Line Items] | |||
Loss on debt extinguishment | $ (30,100) | 30,100 | |
Loss on extinguishment premium and fees | 12,400 | 12,400 | |
Write off of debt issuance cost and debt discount | $ 17,700 | $ 17,700 |
DEBT - Liquidity Additional Inf
DEBT - Liquidity Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Cash and cash equivalents | $ 58,075 | $ 55,193 |
Surety Bond | ||
Debt Instrument [Line Items] | ||
Outstanding letter of credit | 1,600 | |
Miscellaneous Cash Deposit | ||
Debt Instrument [Line Items] | ||
Outstanding letter of credit | 500 | |
Domestic | ||
Debt Instrument [Line Items] | ||
Outstanding letter of credit | 33,300 | |
International | ||
Debt Instrument [Line Items] | ||
Outstanding letter of credit | 300 | |
ABL Facility | ||
Debt Instrument [Line Items] | ||
Cash | 16,300 | |
Restricted cash | 1,400 | |
Available borrowing capacity | 52,400 | |
ABL Eclipse | ||
Debt Instrument [Line Items] | ||
Available borrowing capacity | 42,400 | |
Delayed Draw Term Loan | ||
Debt Instrument [Line Items] | ||
Available borrowing capacity | 10,000 | |
APSC Term Loan | ||
Debt Instrument [Line Items] | ||
Restricted cash | 4,100 | |
Cash and Cash Equivalents | ABL Facility | ||
Debt Instrument [Line Items] | ||
Debt instrument, collateral amount | 51,100 | |
Restricted Cash | ABL Facility | ||
Debt Instrument [Line Items] | ||
Debt instrument, collateral amount | 7,000 | |
Restricted Cash | ABL Facility | Letters of Credit and Commercial Card Programs | ||
Debt Instrument [Line Items] | ||
Debt instrument, collateral amount | $ 4,600 | |
Foreign Financial Institutions | ||
Debt Instrument [Line Items] | ||
Cash | 14,200 | |
Restricted cash | $ 2,400 |
LEASES - Additional Information
LEASES - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | ||
Options to extend leases (up to) | 10 years | |
Options to terminate leases | 1 year | |
Operating lease costs | $ 37.3 | $ 39.4 |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Operating and finance leases, remaining lease term | 1 year | |
Maximum | ||
Lessee, Lease, Description [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 | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease costs | $ 25,116 | $ 27,773 |
Variable lease costs | 5,346 | 5,546 |
Finance lease costs: | ||
Amortization of right-of-use assets | 765 | 666 |
Interest on lease liabilities | 421 | 344 |
Total lease cost | 31,648 | 34,329 |
Discontinued Operations | ||
Finance lease costs: | ||
Total lease cost | 841 | 1,656 |
Lease cost - continuing operations | ||
Finance lease costs: | ||
Total lease cost | $ 30,807 | $ 32,673 |
LEASES - Cash Flow Lease Inform
LEASES - Cash Flow Lease Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash paid for amounts included in the measurement of lease liabilities | ||
Operating cash flows from operating leases | $ 19,032 | $ 16,856 |
Operating cash flows from finance leases | 316 | 345 |
Financing cash flows from finance leases | 885 | 515 |
Right-of-use assets obtained in exchange for lease obligations | ||
Operating leases | 3,455 | 8,008 |
Finance leases | $ 1,270 | $ 1,011 |
LEASES - Amounts Recognized in
LEASES - Amounts Recognized in the Balance Sheet for Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Leases: | ||
Operating lease right-of-use assets | $ 48,462 | $ 58,495 |
Current portion of operating lease obligations | 13,823 | 15,412 |
Operating lease obligations (non-current) | 38,819 | 47,617 |
Finance Leases: | ||
Property, plant and equipment, net | 5,107 | 5,114 |
Current portion of long-term debt and finance lease obligations | 960 | 667 |
Long-term debt and finance lease obligations | $ 4,942 | $ 4,973 |
Weighted average remaining lease term | ||
Operating leases | 6 years | 6 years |
Finance leases | 9 years | 10 years |
Weighted average discount rate | ||
Operating leases | 7.50% | 6.80% |
Finance lease | 7.30% | 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 finance lease obligations | Long-term debt and finance lease obligations |
LEASES - Operating, Finance and
LEASES - Operating, Finance and Capital Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Leases | ||
2023 | $ 14,228 | |
2024 | 11,893 | |
2025 | 8,761 | |
2026 | 6,527 | |
2027 | 5,480 | |
Thereafter | 11,318 | |
Total future minimum lease payments | 58,207 | |
Less: Interest | 5,565 | |
Present value of lease liabilities | 52,642 | |
Finance Leases | ||
2023 | 1,179 | |
2024 | 954 | |
2025 | 686 | |
2026 | 586 | |
2027 | 543 | |
Thereafter | 3,376 | |
Total future minimum lease payments | 7,324 | |
Less: Interest | 1,422 | |
Present value of lease liabilities | $ 5,902 | $ 5,640 |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Information (Details) $ / shares in Units, $ in Millions | 12 Months Ended | |||
Dec. 21, 2022 shares | Mar. 15, 2021 | Dec. 31, 2022 USD ($) performance_condition $ / shares shares | Dec. 31, 2021 USD ($) shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Awards outstanding to officers, directors and key employees | shares | 103,274 | |||
Reverse stock split ratio | 0.1 | |||
Fractional shares issued (in shares) | shares | 0 | |||
Share-based compensation | $ 0.2 | $ 7 | ||
Unrecognized compensation expense related to share-based compensation | $ 1.4 | |||
Remaining weighted-average period | 1 year 4 months 24 days | |||
Recognized income tax benefit | $ 0 | $ 0.7 | ||
Weighted-average remaining contractual life of options exercisable | 7 months 6 days | |||
Range of prices, lower limit | $ / shares | $ 320.50 | |||
Range of prices, upper limit | $ / shares | $ 504.70 | |||
Exercised stock options (in shares) | shares | 0 | 0 | ||
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation | $ 1.5 | $ 4.4 | ||
Stock and Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Intrinsic value of units vested | 0.5 | 1.2 | ||
Long Term Performance Stock Unit Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation | 2.6 | |||
Share based award Income | 1.3 | |||
Performance Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Intrinsic value of units vested | 0 | 0.3 | ||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation | $ 0 | $ 0 | ||
Award vesting period | 4 years | |||
Stock option year term | 10 years | |||
Minimum | Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
Maximum | Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 4 years | |||
2018 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total number of shares authorized to be issued under our stock incentive plans | shares | 3,000,000 | |||
2018 | Performance Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation award, number of performance conditions | performance_condition | 2 | |||
Vested award performance target level, percentage | 25% | |||
Award Vesting Rights, Performance Metric, Percentage | 0% | |||
2018 | Minimum | Performance Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Possible payouts | 0% | |||
2018 | Maximum | Performance Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Possible payouts | 200% | |||
2017 and 2018 | Long Term Performance Stock Unit Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 2 years | |||
Performance Period | 2 years |
SHARE-BASED COMPENSATION - Stoc
SHARE-BASED COMPENSATION - Stock Units and Director Stock Grants (Details) - Stock and Stock Units shares in Thousands | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
No. of Stock Units | |
Beginning of year (in shares) | shares | 80 |
Granted (in shares) | shares | 79 |
Vested and settled (in shares) | shares | (42) |
Cancelled (in shares) | shares | (19) |
End of year (in shares) | shares | 98 |
Weighted Average Fair Value | |
Beginning of year (in USD per share) | $ / shares | $ 73.06 |
Granted (in USD per share) | $ / shares | 8.56 |
Vested and settled (in USD per share) | $ / shares | 80.51 |
Cancelled (in USD per share) | $ / shares | 66.86 |
Stock and stock units, end of year (in USD per share) | $ / shares | $ 19.55 |
SHARE-BASED COMPENSATION - Perf
SHARE-BASED COMPENSATION - Performance Awards (Details) - Performance Shares shares in Thousands | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Market Conditions | |
No. of Stock Units | |
Beginning of year (in shares) | shares | 68 |
Cancelled and forfeited (in shares) | shares | 66 |
End of year (in shares) | shares | 2 |
Weighted Average Fair Value | |
Beginning of year (in USD per share) | $ / shares | $ 64.88 |
Cancelled and forfeited (in USD per share) | $ / shares | 62.08 |
Stock and stock units, end of year (in USD per share) | $ / shares | $ 149.60 |
Other than Market Conditions | |
No. of Stock Units | |
Beginning of year (in shares) | shares | 22 |
Cancelled and forfeited (in shares) | shares | 20 |
End of year (in shares) | shares | 2 |
Weighted Average Fair Value | |
Beginning of year (in USD per share) | $ / shares | $ 98.65 |
Cancelled and forfeited (in USD per share) | $ / shares | 96.23 |
Stock and stock units, end of year (in USD per share) | $ / shares | $ 116.90 |
SHARE-BASED COMPENSATION - St_2
SHARE-BASED COMPENSATION - Stock Options (Detail) - $ / shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
No. of Options | ||
Shares under option, beginning of year (in shares) | 1 | 2 |
Expired of stock options (in shares) | (1) | |
Shares under option, end of year (in shares) | 1 | 2 |
Exercisable at end of year (in shares) | 1 | |
Weighted Average Exercise Price | ||
Shares under option, beginning of year (in USD per share) | $ 356.03 | $ 316.80 |
Expired (in USD per share) | (277.13) | |
Shares under option, end of year (in USD per share) | 356.03 | $ 316.80 |
Exercisable at end of year (in USD per share) | $ 356.03 |
STOCKHOLDERS_ EQUITY - Addition
STOCKHOLDERS’ EQUITY - Additional Information (Details) | Dec. 21, 2022 shares | Dec. 31, 2022 $ / shares shares | Dec. 20, 2022 shares | Dec. 31, 2021 $ / shares shares |
Equity [Abstract] | ||||
Reverse stock split ratio | 0.1 | |||
Common stock, shares authorized (in shares) | 12,000,000 | 12,000,000 | 120,000,000 | 12,000,000 |
Common stock, shares, outstanding (in shares) | 4,342,909 | 4,342,909 | 43,429,089 | |
Fractional shares issued (in shares) | 0 | |||
Common stock, par value (in usd per share) | $ / shares | $ 0.30 | $ 0.30 | ||
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 | ||
Preferred stock, shares issued (in shares) | 0 | 0 |
STOCKHOLDERS_ EQUITY - Summary
STOCKHOLDERS’ EQUITY - Summary of Changes in AOCI (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 51,867 | |
Other comprehensive income (loss) | (13,190) | $ 1,935 |
Tax Effect | 925 | (989) |
Other comprehensive income (loss), net of tax | (12,265) | 946 |
Ending balance | 117,760 | 51,867 |
Foreign Currency Translation Adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (25,258) | (23,045) |
Other comprehensive income (loss) | (6,589) | (2,213) |
Ending balance | (31,847) | (25,258) |
Foreign Currency Hedge | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 2,988 | 2,988 |
Other comprehensive income (loss) | 0 | 0 |
Ending balance | 2,988 | 2,988 |
Defined benefit pension plans | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (3,873) | (8,021) |
Other comprehensive income (loss) | (6,601) | 4,148 |
Ending balance | (10,474) | (3,873) |
Tax Provision | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (589) | 400 |
Tax Effect | 925 | (989) |
Ending balance | 336 | (589) |
Accumulated Other Comprehensive Loss | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (26,732) | (27,678) |
Ending balance | $ (38,997) | $ (26,732) |
STOCKHOLDERS_ EQUITY - Related
STOCKHOLDERS’ EQUITY - Related Tax Effects of AOCI (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Gross Amount | $ (13,190) | $ 1,935 |
Tax Effect | 925 | (989) |
Other comprehensive (loss) income, net of tax | (12,265) | 946 |
Foreign Currency Translation Adjustments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Gross Amount | (6,589) | (2,213) |
Tax Effect | 0 | (1) |
Other comprehensive (loss) income, net of tax | (6,589) | (2,214) |
Defined benefit pension plans | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Gross Amount | (6,601) | 4,148 |
Tax Effect | 925 | (988) |
Other comprehensive (loss) income, net of tax | $ (5,676) | $ 3,160 |
EMPLOYEE BENEFIT PLANS - Define
EMPLOYEE BENEFIT PLANS - Defined Contribution Plans (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Team, Inc. Salary Deferral Plan | |
Defined Contribution Plan Disclosure [Line Items] | |
Employer contributions to the defined contribution plan | $ 3.3 |
EMPLOYEE BENEFIT PLANS - Defi_2
EMPLOYEE BENEFIT PLANS - Defined Benefit Plans (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 | Dec. 31, 2020 subsidiary plan | |
Defined Benefit Plan Disclosure [Line Items] | |||
Defined benefit plan, expected future employer contributions, next fiscal year | $ | $ 3.7 | ||
Discount rate | 5% | 2% | |
Expected long-term return on plan assets | 2.80% | 2.10% | |
Weighted Average | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return on plan assets | 6.40% | ||
Weighted Average | Equity Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return on plan assets | 9.50% | ||
Weighted Average | Debt securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return on plan assets | 5.30% | ||
Foreign plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined benefit plan, number of plans | subsidiary | 2 | ||
UNITED KINGDOM | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined benefit plan, number of plans | plan | 1 |
EMPLOYEE BENEFIT PLANS - Schedu
EMPLOYEE BENEFIT PLANS - Schedule of Net Pension Cost (Credit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Interest cost | $ 1,586 | $ 1,282 |
UNITED KINGDOM | Pension Plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Interest cost | 1,586 | 1,282 |
Settlement cost | 0 | 70 |
Expected return on plan assets | (2,362) | (2,006) |
Amortization of prior service cost | 31 | 32 |
Net pension cost (credit) | $ (745) | $ (622) |
EMPLOYEE BENEFIT PLANS - Sche_2
EMPLOYEE BENEFIT PLANS - Schedule of Assumptions Used (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Weighted Average Assumptions Used in Calculating Benefit Obligation | ||
Discount rate | 5% | 2% |
Inflation | 3.20% | 3.30% |
Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost (Credit) | ||
Discount rate | 2% | 1.30% |
Expected long-term return on plan assets | 2.80% | 2.10% |
Inflation | 3.30% | 2.90% |
EMPLOYEE BENEFIT PLANS - Change
EMPLOYEE BENEFIT PLANS - Changes in Benefit Obligation and Plan Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Projected benefit obligation: | ||
Beginning of year | $ 91,262 | $ 100,244 |
Service cost | 0 | 0 |
Interest cost | $ 1,586 | $ 1,282 |
Defined Benefit Plan Net Periodic Benefit Cost Credit Interest Cost Statement Of Income Or Comprehensive Income Extensible List Not Disclosed Flag | Interest cost | Interest cost |
Actuarial (gain) loss | $ (22,444) | $ (4,237) |
Benefits paid | (5,028) | (5,137) |
Foreign currency translation adjustment and other | (9,206) | (890) |
End of year | 56,170 | 91,262 |
Fair value of plan assets: | ||
Beginning of year | 94,164 | 94,962 |
Actual gain (loss) on plan assets | (26,919) | 1,195 |
Employer contributions | 3,699 | 4,118 |
Benefits paid | (5,028) | (5,137) |
Foreign currency translation adjustment and other | (9,348) | (974) |
End of year | 56,568 | 94,164 |
Excess projected obligation under (over) fair value of plan assets at end of year | 398 | 2,902 |
Amounts recognized in accumulated other comprehensive loss: | ||
Net actuarial loss | (10,980) | (4,624) |
Prior service cost | (520) | (601) |
Total | $ (11,500) | $ (5,225) |
EMPLOYEE BENEFIT PLANS - Sche_3
EMPLOYEE BENEFIT PLANS - Schedule of Expected Benefit Payments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Retirement Benefits [Abstract] | |
2023 | $ 3,738 |
2024 | 3,645 |
2025 | 3,808 |
2026 | 3,756 |
2027 | 3,836 |
2028-2032 | 19,388 |
Total | $ 38,171 |
EMPLOYEE BENEFIT PLANS - Sche_4
EMPLOYEE BENEFIT PLANS - Schedule of Fair Value of Plan Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | $ 56,568 | $ 94,164 | $ 94,962 |
UK Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 56,568 | 94,281 | |
UK Pension Plan | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 1,861 | 2,411 | |
UK Pension Plan | Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 44,270 | 80,427 | |
UK Pension Plan | Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 10,437 | 11,443 | $ 9,752 |
Cash | UK Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 1,861 | 2,411 | |
Cash | UK Pension Plan | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 1,861 | 2,411 | |
Cash | UK Pension Plan | Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | 0 | |
Cash | UK Pension Plan | Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | 0 | |
Diversified Growth Fund | UK Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 15,285 | 23,582 | |
Diversified Growth Fund | UK Pension Plan | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | 0 | |
Diversified Growth Fund | UK Pension Plan | Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 4,848 | 12,139 | |
Diversified Growth Fund | UK Pension Plan | Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 10,437 | 11,443 | |
Fixed Income Securities | UK Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 6,471 | 9,487 | |
Fixed Income Securities | UK Pension Plan | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | 0 | |
Fixed Income Securities | UK Pension Plan | Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 6,471 | 9,487 | |
Fixed Income Securities | UK Pension Plan | Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | 0 | |
Government Index Linked Securities | UK Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 7,942 | 16,393 | |
Government Index Linked Securities | UK Pension Plan | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | 0 | |
Government Index Linked Securities | UK Pension Plan | Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 7,942 | 16,393 | |
Government Index Linked Securities | UK Pension Plan | Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | $ 0 | 0 | |
Global Absolute Return Bond Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset target return period | 3 years | ||
Global Absolute Return Bond Fund | LIBOR | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target return on asset category | 3% | ||
Global Absolute Return Bond Fund | UK Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 12,111 | ||
Global Absolute Return Bond Fund | UK Pension Plan | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | ||
Global Absolute Return Bond Fund | UK Pension Plan | Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 12,111 | ||
Global Absolute Return Bond Fund | UK Pension Plan | Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | ||
Corporate Bonds | UK Pension Plan | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | $ 25,009 | 30,297 | |
Corporate Bonds | UK Pension Plan | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 0 | 0 | |
Corporate Bonds | UK Pension Plan | Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | 25,009 | 30,297 | |
Corporate Bonds | UK Pension Plan | Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair Value of Plan Assets | $ 0 | $ 0 |
EMPLOYEE BENEFIT PLANS - Sche_5
EMPLOYEE BENEFIT PLANS - Schedule of Asset Allocations (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Defined Benefit Plan Disclosure [Line Items] | ||
Asset Allocations | 100% | 100% |
Target Asset Allocations | 100% | 100% |
Equity securities and diversified growth funds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Asset Allocations | 27% | 24.90% |
Target Asset Allocations | 27.50% | 27.50% |
Equity securities and diversified growth funds | Minimum | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Asset Allocations | 25% | |
Equity securities and diversified growth funds | Maximum | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Asset Allocations | 30% | |
Debt securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Asset Allocations | 69.70% | 72.50% |
Target Asset Allocations | 72.50% | 72.50% |
Debt securities | Minimum | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Asset Allocations | 70% | |
Debt securities | Maximum | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Asset Allocations | 75% | |
Other | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Asset Allocations | 3.30% | 2.60% |
Target Asset Allocations | 0% | 0% |
EMPLOYEE BENEFIT PLANS - Level
EMPLOYEE BENEFIT PLANS - Level 3 Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Beginning of year | $ 94,164 | $ 94,962 |
End of year | 56,568 | 94,164 |
UK Pension Plan | ||
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Beginning of year | 94,281 | |
End of year | 56,568 | 94,281 |
Significant Unobservable Inputs (Level 3) | UK Pension Plan | ||
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Beginning of year | 11,443 | 9,752 |
Actual return on plan assets | 195 | 1,790 |
Purchases/ sales/ settlements | 0 | 0 |
Transfer in/out of level 3 | 0 | 0 |
Changes due to foreign exchange | (1,201) | (99) |
End of year | $ 10,437 | $ 11,443 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 3 Months Ended | 14 Months Ended | ||||
Feb. 09, 2022 USD ($) | Jun. 01, 2021 USD ($) | Sep. 30, 2022 USD ($) | Aug. 26, 2020 complaint | Dec. 31, 2022 USD ($) | Apr. 20, 2021 facility | |
Loss Contingencies [Line Items] | ||||||
Number of facilities with potential violations | facility | 7 | |||||
Self-insured retention and deductible | $ 3 | |||||
Environmental Protection Agency (EPA) | ||||||
Loss Contingencies [Line Items] | ||||||
Cost incurred in dispute | $ 0.2 | |||||
Thai Action | ||||||
Loss Contingencies [Line Items] | ||||||
Cost incurred in dispute | $ 3 | |||||
New claims filed | complaint | 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 | |||||
Simon, Vige, and Roberts Matter | ||||||
Loss Contingencies [Line Items] | ||||||
Legal and professional accruals | 42.3 | |||||
Amount not covered by insurance | $ 3.3 |
SEGMENT AND GEOGRAPHIC DISCLO_3
SEGMENT AND GEOGRAPHIC DISCLOSURES - Additional Information (Details) | 2 Months Ended | 10 Months Ended | 12 Months Ended | |
Nov. 01, 2022 Segment | Dec. 31, 2022 segment | Oct. 31, 2022 segment | Dec. 31, 2022 segment | |
Segment Reporting [Abstract] | ||||
Number of operating segments | 2 | 2 | 3 | 2 |
SEGMENT AND GEOGRAPHIC DISCLO_4
SEGMENT AND GEOGRAPHIC DISCLOSURES - Segment Data for our Three Operating Segments (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Segment Reporting Information [Line Items] | |||
Revenues | $ 840,208,000 | $ 794,197,000 | |
Operating income (loss) | (39,802,000) | (126,882,000) | |
Goodwill impairment charges | [1] | 0 | 64,632,000 |
Capital expenditures | 19,036,000 | 16,898,000 | |
Depreciation and amortization | [1] | 37,595,000 | 41,518,000 |
Lease cost - continuing operations | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 36,453,000 | 38,902,000 | |
IHT | |||
Segment Reporting Information [Line Items] | |||
Revenues | 422,562,000 | 415,371,000 | |
MS | |||
Segment Reporting Information [Line Items] | |||
Revenues | 417,646,000 | 378,826,000 | |
Goodwill impairment charges | 55,800,000 | ||
Operating Segments | IHT | |||
Segment Reporting Information [Line Items] | |||
Revenues | 422,562,000 | 415,371,000 | |
Operating income (loss) | 17,093,000 | 12,997,000 | |
Capital expenditures | 13,939,000 | 11,742,000 | |
Operating Segments | IHT | Lease cost - continuing operations | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 12,391,000 | 12,959,000 | |
Operating Segments | MS | |||
Segment Reporting Information [Line Items] | |||
Revenues | 417,646,000 | 378,826,000 | |
Operating income (loss) | 20,930,000 | (47,728,000) | |
Capital expenditures | 5,013,000 | 3,692,000 | |
Operating Segments | MS | Lease cost - continuing operations | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 19,021,000 | 20,500,000 | |
Corporate and shared support services | |||
Segment Reporting Information [Line Items] | |||
Operating income (loss) | (77,825,000) | (92,151,000) | |
Capital expenditures | 84,000 | 1,464,000 | |
Corporate and shared support services | Lease cost - continuing operations | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | $ 5,041,000 | $ 5,443,000 | |
[1]Consolidated statements of cash flows include discontinued operations. December 31, 2022 2021 Cash and cash equivalents from continuing operations $ 58,075 $ 55,193 Cash and cash equivalents from discontinued operations — 10,122 Total $ 58,075 $ 65,315 |
SEGMENT AND GEOGRAPHIC DISCLO_5
SEGMENT AND GEOGRAPHIC DISCLOSURES - Geographic Breakdown of Revenues and Total Long-Lived Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Revenues | $ 840,208 | $ 794,197 |
Total Long-Lived Assets | 261,968 | 292,294 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Revenues | 613,021 | 561,416 |
Total Long-Lived Assets | 240,088 | 261,540 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Revenues | 95,790 | 100,397 |
Total Long-Lived Assets | 4,708 | 7,290 |
Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Revenues | 61,713 | 66,926 |
Total Long-Lived Assets | 14,591 | 19,619 |
Other foreign countries | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Revenues | 69,684 | 65,458 |
Total Long-Lived Assets | $ 2,581 | $ 3,845 |
RESTRUCTURING AND OTHER RELAT_3
RESTRUCTURING AND OTHER RELATED CHARGES - Schedule of Restructuring Charges by Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||
Charges | $ 16 | $ 2,535 |
Operating Group Reorganization | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 16 | 2,535 |
Employee Severance | Operating Group Reorganization | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 3,961 | |
Employee Severance | Operating Group Reorganization | IHT | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 16 | 459 |
Employee Severance | Operating Group Reorganization | MS | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | 0 | 514 |
Employee Severance | Operating Group Reorganization | Corporate and shared support services | ||
Restructuring Cost and Reserve [Line Items] | ||
Charges | $ 0 | $ 1,562 |
RESTRUCTURING AND OTHER RELAT_4
RESTRUCTURING AND OTHER RELATED CHARGES - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Group Reorganization | ||
Restructuring Cost and Reserve [Line Items] | ||
Professional fees | $ 0 | $ 1.9 |
Employee Severance | ||
Restructuring Cost and Reserve [Line Items] | ||
Severance charges incurred to date | $ 4 | $ 2.5 |
RESTRUCTURING AND OTHER RELAT_5
RESTRUCTURING AND OTHER RELATED CHARGES - Rollforward of Restructuring Liability - OneTEAM Program (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Restructuring Reserve [Roll Forward] | ||
Charges | $ 16 | $ 2,535 |
Operating Group Reorganization | ||
Restructuring Reserve [Roll Forward] | ||
Charges | 16 | 2,535 |
Employee Severance | Operating Group Reorganization | ||
Restructuring Reserve [Roll Forward] | ||
Balance, beginning of period | 712 | |
Charges | 3,961 | |
Payments | (2,734) | |
Balance, end of period | $ 1,939 | $ 712 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Alvarez And Marsal | ||
Related Party Transaction [Line Items] | ||
Expenses from transactions with related party | $ 8.1 | $ 8 |