Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 2-May-14 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'US ECOLOGY, INC. | ' |
Entity Central Index Key | '0000742126 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 21,551,223 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current Assets: | ' | ' |
Cash and cash equivalents | $77,918 | $73,940 |
Receivables, net | 41,678 | 43,636 |
Prepaid expenses and other current assets | 2,832 | 3,612 |
Deferred income taxes | 659 | 1,340 |
Total current assets | 123,087 | 122,528 |
Property and equipment, net | 116,419 | 114,859 |
Restricted cash and investments | 4,111 | 4,097 |
Intangible assets, net | 35,187 | 36,832 |
Goodwill | 20,941 | 21,693 |
Other assets | 411 | 547 |
Total assets | 300,156 | 300,556 |
Current Liabilities: | ' | ' |
Accounts payable | 4,605 | 7,277 |
Deferred revenue | 7,458 | 8,870 |
Accrued liabilities | 7,962 | 8,691 |
Accrued salaries and benefits | 4,872 | 6,957 |
Income taxes payable | 5,113 | 4,428 |
Current portion of closure and post-closure obligations | 916 | 949 |
Total current liabilities | 30,926 | 37,172 |
Long-term closure and post-closure obligations | 19,552 | 16,519 |
Other long-term liabilities | 58 | 69 |
Unrecognized tax benefits | 483 | 480 |
Deferred income taxes | 13,213 | 14,778 |
Total liabilities | 64,232 | 69,018 |
Commitments and contingencies | ' | ' |
Stockholders' Equity: | ' | ' |
Common stock $0.01 par value, 50,000 authorized; 21,548 and 21,538 shares issued, respectively | 215 | 215 |
Additional paid-in capital | 163,275 | 162,830 |
Retained earnings | 76,085 | 70,597 |
Treasury stock, at cost, 18 and 19 shares , respectively | -387 | -319 |
Accumulated other comprehensive income (loss) | -3,264 | -1,785 |
Total stockholders' equity | 235,924 | 231,538 |
Total liabilities and stockholders' equity | $300,156 | $300,556 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS | ' | ' |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 50,000 | 50,000 |
Common stock, shares issued | 21,548 | 21,538 |
Treasury stock, shares | 18 | 19 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
CONSOLIDATED STATEMENTS OF OPERATIONS | ' | ' |
Revenue | $53,354 | $42,899 |
Direct operating costs | 22,621 | 21,084 |
Transportation costs | 8,613 | 6,433 |
Gross profit | 22,120 | 15,382 |
Selling, general and administrative expenses | 6,636 | 5,726 |
Operating income | 15,484 | 9,656 |
Other income (expense): | ' | ' |
Interest income | 44 | 5 |
Interest expense | -86 | -221 |
Foreign currency gain (loss) | -940 | -938 |
Other | 86 | 97 |
Total other income (expense) | -896 | -1,057 |
Income before income taxes | 14,588 | 8,599 |
Income tax expense | 5,227 | 3,193 |
Net income | $9,361 | $5,406 |
Earnings per share: | ' | ' |
Basic (in dollars per share) | $0.44 | $0.30 |
Diluted (in dollars per share) | $0.43 | $0.29 |
Shares used in earnings per share calculation: | ' | ' |
Basic (in shares) | 21,475 | 18,320 |
Diluted (in shares) | 21,586 | 18,407 |
Dividends paid per share (in dollars per share) | $0.18 | ' |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ' | ' |
Net income | $9,361 | $5,406 |
Other comprehensive income (loss): | ' | ' |
Foreign currency translation gain (loss) | -1,479 | -750 |
Comprehensive income | $7,882 | $4,656 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities: | ' | ' |
Net income | $9,361 | $5,406 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization of property and equipment | 3,839 | 3,439 |
Amortization of intangible assets | 352 | 367 |
Accretion of closure and post-closure obligations | 330 | 307 |
Unrealized foreign currency (gain) loss | 1,452 | 1,057 |
Deferred income taxes | -460 | -716 |
Share-based compensation expense | 270 | 146 |
Unrecognized tax benefits | 3 | 3 |
Net (gain) loss on sale of property and equipment | 8 | -41 |
Changes in assets and liabilities: | ' | ' |
Receivables | 1,259 | 1,473 |
Other assets | 882 | 732 |
Accounts payable and accrued liabilities | -2,142 | -556 |
Deferred revenue | -1,164 | 1,269 |
Accrued salaries and benefits | -1,994 | -3,106 |
Income taxes payable | 783 | 3,528 |
Closure and post-closure obligations | -114 | -1,043 |
Net cash provided by operating activities | 12,665 | 12,265 |
Cash flows from investing activities: | ' | ' |
Purchases of property and equipment | -4,775 | -6,752 |
Purchases of restricted cash and investments | -14 | ' |
Proceeds from sale of property and equipment | 6 | 52 |
Net cash used in investing activities | -4,783 | -6,700 |
Cash flows from financing activities: | ' | ' |
Dividends paid | -3,874 | ' |
Proceeds from exercise of stock options | 174 | 1,050 |
Payments on reducing revolving line of credit | ' | -4,000 |
Deferred financing costs paid | ' | -177 |
Other | -65 | 2 |
Net cash used in financing activities | -3,765 | -3,125 |
Effect of foreign exchange rate changes on cash | -139 | -49 |
Increase in cash and cash equivalents | 3,978 | 2,391 |
Cash and cash equivalents at beginning of period | 73,940 | 2,120 |
Cash and cash equivalents at end of period | 77,918 | 4,511 |
Supplemental Disclosures | ' | ' |
Income taxes paid, net of receipts | 4,934 | 378 |
Interest paid | 40 | 184 |
Non-cash investing and financing activities: | ' | ' |
Closure and post-closure retirement asset | 2,863 | ' |
Capital expenditures in accounts payable | 419 | 1,645 |
Restricted stock issued from treasury shares | $118 | $629 |
GENERAL
GENERAL | 3 Months Ended |
Mar. 31, 2014 | |
GENERAL | ' |
GENERAL | ' |
NOTE 1. GENERAL | |
Basis of Presentation | |
The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All significant intercompany balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and the “Company” refer to US Ecology, Inc. and its subsidiaries. | |
In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. The results of operations and cash flows for the three months ended March 31, 2014 are not necessarily indicative of results to be expected for the entire fiscal year. | |
The Company’s Consolidated Balance Sheet as of December 31, 2013 has been derived from the Company’s audited Consolidated Balance Sheet as of that date. | |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future. | |
Restricted Cash and Investments | |
Restricted cash and investments of $4.1 million at March 31, 2014 and 2013 represent funds held in third-party managed trust accounts as collateral for our financial assurance obligations for post-closure activities at our non-operating facilities. These funds are invested in fixed-income U.S. Treasury and government agency securities and money market accounts. The balances are adjusted monthly to fair market value based on quoted prices in active markets for identical or similar assets. | |
ACCUMULATED_OTHER_COMPREHENSIV
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ' | |||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ' | |||||||
NOTE 2. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ||||||||
Changes in accumulated other comprehensive income (loss), comprised entirely of foreign currency translation adjustments, consisted of the following: | ||||||||
Three Months Ended March 31, | ||||||||
$s in thousands | 2014 | 2013 | ||||||
Balance, beginning of period | $ | (1,785 | ) | $ | 628 | |||
Foreign currency translation gain (loss) in other comprehensive income | (1,479 | ) | (750 | ) | ||||
Balance, end of period | $ | (3,264 | ) | $ | (122 | ) |
CONCENTRATIONS_AND_CREDIT_RISK
CONCENTRATIONS AND CREDIT RISK | 3 Months Ended |
Mar. 31, 2014 | |
CONCENTRATIONS AND CREDIT RISK | ' |
CONCENTRATIONS AND CREDIT RISK | ' |
NOTE 3. CONCENTRATIONS AND CREDIT RISK | |
Major Customers | |
Revenue from a single customer accounted for 11% of total revenue for the three months ended March 31, 2014. No other customer accounted for more than 10% of total revenue for the three months ended March 31, 2014. No customer accounted for more than 10% of total revenue for the three months ended March 31, 2013. | |
Receivables from a single customer accounted for approximately 16% of total trade receivables as of March 31, 2014. No other customer accounted for more than 10% of total trade receivables as of March 31, 2014. A single customer accounted for approximately 16% of total trade receivables as of December 31, 2013. | |
Credit Risk Concentration | |
We maintain most of our cash with nationally recognized financial institutions like Wells Fargo Bank, National Association (“Wells Fargo”). Substantially all balances are uninsured and are not used as collateral for other obligations. Concentrations of credit risk on accounts receivable are believed to be limited due to the number, diversification and character of the obligors and our credit evaluation process. | |
RECEIVABLES
RECEIVABLES | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
RECEIVABLES | ' | |||||||
RECEIVABLES | ' | |||||||
NOTE 4. RECEIVABLES | ||||||||
Receivables consisted of the following: | ||||||||
March 31, | December 31, | |||||||
$s in thousands | 2014 | 2013 | ||||||
Trade | $ | 39,012 | $ | 42,055 | ||||
Unbilled revenue | 1,678 | 1,296 | ||||||
Other | 1,381 | 810 | ||||||
Total receivables | 42,071 | 44,161 | ||||||
Allowance for doubtful accounts | (393 | ) | (525 | ) | ||||
Receivables, net | $ | 41,678 | $ | 43,636 |
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
PROPERTY AND EQUIPMENT | ' | |||||||
PROPERTY AND EQUIPMENT | ' | |||||||
NOTE 5. PROPERTY AND EQUIPMENT | ||||||||
Property and equipment consisted of the following: | ||||||||
March 31, | December 31, | |||||||
$s in thousands | 2014 | 2013 | ||||||
Cell development costs | $ | 81,004 | $ | 77,348 | ||||
Land and improvements | 17,967 | 18,073 | ||||||
Buildings and improvements | 58,515 | 59,101 | ||||||
Railcars | 17,375 | 17,375 | ||||||
Vehicles and other equipment | 43,847 | 42,859 | ||||||
Construction in progress | 7,292 | 6,784 | ||||||
Total property and equipment | 226,000 | 221,540 | ||||||
Accumulated depreciation and amortization | (109,581 | ) | (106,681 | ) | ||||
Property and equipment, net | $ | 116,419 | $ | 114,859 | ||||
Depreciation and amortization expense for the three months ended March 31, 2014 and 2013 was $3.8 million and $3.4 million, respectively. |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
NOTE 6. FAIR VALUE MEASUREMENTS | ||||||||||||||
Fair value is defined as 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. Assets and liabilities recorded at fair value are categorized using defined hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair value measurements, as follows: | ||||||||||||||
Level 1 - Quoted prices in active markets for identical assets or liabilities; | ||||||||||||||
Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable; | ||||||||||||||
Level 3 - Unobservable inputs in which little or no market activity exists, requiring an entity to develop its own assumptions that market participants would use to value the asset or liability. | ||||||||||||||
The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, restricted cash and investments, accounts payable and accrued liabilities. The estimated fair value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their carrying value due to the short-term nature of these instruments. | ||||||||||||||
The Company’s assets measured at fair value on a recurring basis consisted of our Restricted cash and investments as follows: | ||||||||||||||
March 31, 2014 | ||||||||||||||
Quoted Prices in | Other Observable | Unobservable | ||||||||||||
Active Markets | Inputs | Inputs | ||||||||||||
$s in thousands | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Assets: | ||||||||||||||
Fixed-income securities (1) | $ | 399 | $ | 3,611 | $ | — | $ | 4,010 | ||||||
Money market funds (2) | $ | 101 | $ | — | $ | — | $ | 101 | ||||||
Total | $ | 500 | $ | 3,611 | $ | — | $ | 4,111 | ||||||
December 31, 2013 | ||||||||||||||
Quoted Prices in | Other Observable | Unobservable | ||||||||||||
Active Markets | Inputs | Inputs | ||||||||||||
$s in thousands | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Assets: | ||||||||||||||
Fixed-income securities (1) | $ | 399 | $ | 3,607 | $ | — | $ | 4,006 | ||||||
Money market funds (2) | $ | 91 | $ | — | $ | — | $ | 91 | ||||||
Total | $ | 490 | $ | 3,607 | $ | — | $ | 4,097 | ||||||
(1) We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments. | ||||||||||||||
(2) We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets. | ||||||||||||||
GOODWILL_AND_INTANGIBLE_ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
GOODWILL AND INTANGIBLE ASSETS | ' | |||||||
GOODWILL AND INTANGIBLE ASSETS | ' | |||||||
NOTE 7. GOODWILL AND INTANGIBLE ASSETS | ||||||||
Goodwill and intangible assets as of March 31, 2014, were the result of our acquisitions of U.S. Ecology Michigan,Inc. on May 31, 2012 and Stablex Canada Inc. (“Stablex”) on October 31, 2010. Prior to the acquisition of Stablex, the Company had no goodwill and intangible assets. All goodwill has been assigned to the Operating Disposal Facilities reporting segment. Changes in goodwill for the three months ended March 31, 2014 consisted of the following: | ||||||||
$s in thousands | Goodwill | |||||||
Balance at December 31, 2013 | $ | 21,693 | ||||||
Foreign currency translation | (752 | ) | ||||||
Balance at March 31, 2014 | $ | 20,941 | ||||||
Intangible assets consisted of the following: | ||||||||
$s in thousands | March 31, | December 31, | ||||||
2014 | 2013 | |||||||
Amortizing intangible assets: | ||||||||
Developed software | $ | 317 | $ | 329 | ||||
Database | 90 | 94 | ||||||
Customer relationships | 4,863 | 5,005 | ||||||
Technology - Formulae and processes | 8,235 | 8,551 | ||||||
Permits, licenses and lease | 25,294 | 26,264 | ||||||
Non-compete agreements | 20 | 20 | ||||||
Total amortizing intangible assets | 38,819 | 40,263 | ||||||
Accumulated amortization | (4,536 | ) | (4,341 | ) | ||||
Nonamortizing intangible assets: | ||||||||
Permits and licenses | 750 | 750 | ||||||
Tradename | 154 | 160 | ||||||
Total intangible assets, net | $ | 35,187 | $ | 36,832 | ||||
Amortization expense for the three months ended March 31, 2014 and 2013 was $352,000 and $367,000, respectively. |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2014 | |
DEBT | ' |
DEBT | ' |
NOTE 8. DEBT | |
On October 29, 2010, we entered a credit agreement with Wells Fargo which, as amended, provides for an aggregate commitment from Wells Fargo of $95.0 million (the “Credit Agreement”). The Credit Agreement provides for a $20.0 million revolving line of credit (the “Revolving Line of Credit”) with a maturity date of November 1, 2015 and a $75.0 million reducing revolving line of credit (the “Reducing Revolving Line of Credit”) with a maturity date of November 1, 2015. | |
Revolving Line of Credit | |
The Revolving Line of Credit provides up to $20.0 million in revolving credit loans or letters of credit for working capital needs (the “Commitment Amount”). Under the Revolving Line of Credit, revolving loans are available based on the Prime Rate or the LIBOR, at the Company’s option, plus an applicable margin which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). At March 31, 2014, the effective interest rate on the Revolving Line of Credit was 1.40%. Interest only payments are due either monthly or on the last day of any interest period, as applicable. At March 31, 2014, there were no borrowings outstanding on the Revolving Line of Credit. The availability under the Revolving Line of Credit was $19.7 million with $257,000 of the line of credit issued in the form of a standby letter of credit utilized as collateral for closure and post-closure financial assurance. | |
Reducing Revolving Line of Credit | |
The Reducing Revolving Line of Credit provides an initial commitment amount of $75.0 million (the “Reducing Revolving Commitment Amount”). The Reducing Revolving Commitment Amount is reduced by $2.8 million on the last day of each March, June, September and December beginning March 31, 2013, continuing through November 1, 2015. Under the Reducing Revolving Line of Credit revolving loans are available based on the Prime Rate or LIBOR, at the Company’s option, plus an applicable margin, which is determined according to a pricing grid under which the interest rate decreases or increases based on our ratio of funded debt to EBITDA. At March 31, 2014, the effective interest rate of the Reducing Revolving Line of Credit was 1.40%. Interest only payments are due either monthly or on the last day of any interest period, as applicable. At March 31, 2014, there were no borrowings outstanding on the Reducing Revolving Line of Credit with $61.1 million available for additional borrowings. | |
In addition to standard fees, origination fees and commitment fees apply to the average daily unused portion of the Commitment Amount and the Reducing Revolving Commitment Amount. The Credit Agreement contains certain quarterly financial covenants, including a maximum funded debt ratio, a maximum fixed charge coverage ratio, a minimum required tangible net worth and a minimum current ratio. We may only declare quarterly or annual dividends if on the date of declaration, no event of default has occurred and no other event or condition has occurred that would constitute default due to the payment of the dividend. Obligations under the Credit Agreement are guaranteed by US Ecology and all of its subsidiaries. | |
At March 31, 2014, we were in compliance with all of the financial covenants in the Credit Agreement. | |
CLOSURE_AND_POSTCLOSURE_OBLIGA
CLOSURE AND POST-CLOSURE OBLIGATIONS | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
CLOSURE AND POST-CLOSURE OBLIGATIONS | ' | ||||
CLOSURE AND POST-CLOSURE OBLIGATIONS | ' | ||||
NOTE 9. CLOSURE AND POST-CLOSURE OBLIGATIONS | |||||
Our accrued closure and post-closure obligations represent the expected future costs, including corrective actions, associated with closure and post-closure of our operating and non-operating disposal facilities. Liabilities are recorded when work is probable and the costs can be reasonably estimated. We perform periodic reviews of both non-operating and operating facilities and revise accruals for estimated closure and post-closure, remediation or other costs as necessary. Recorded liabilities are based on our best estimates of current costs and are updated periodically to include the effects of existing technology, presently enacted laws and regulations, inflation and other economic factors. | |||||
Changes to reported closure and post-closure obligations consisted of the following: | |||||
Three Months Ended | |||||
$s in thousands | March 31, 2014 | ||||
Closure and post-closure obligations, beginning of period | $ | 17,468 | |||
Accretion expense | 330 | ||||
Payments | (114 | ) | |||
Adjustments | 2,863 | ||||
Currency translation | (79 | ) | |||
Closure and post-closure obligations, end of period | 20,468 | ||||
Less current portion | (916 | ) | |||
Long-term portion | $ | 19,552 |
INCOME_TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2014 | |
INCOME TAXES | ' |
INCOME TAXES | ' |
NOTE 10. INCOME TAXES | |
During the three months ended March 31, 2014, there were no material changes to our unrecognized tax benefits disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2013. We anticipate that within the next twelve months the total amount of unrecognized tax benefits will decrease due to the expiration of statutes of limitations. | |
Our effective tax rate for the three months ended March 31, 2014 was 35.8%, down from 37.1% for the three months ended March 31, 2013. The decrease for the three months ended March 31, 2014 reflects a higher proportion of earnings from our Canadian operations, which are taxed at a lower corporate tax rate. | |
We file a consolidated U.S. federal income tax return with the Internal Revenue Service as well as income tax returns in various states and Canada. We may be subject to examination by taxing authorities in the U.S. and Canada for tax years 2010 through 2013. Additionally, we may be subject to examinations by various state and local taxing jurisdictions for tax years 2009 through 2013. | |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2014 | |
COMMITMENTS AND CONTINGENCIES. | ' |
COMMITMENTS AND CONTINGENCIES | ' |
NOTE 11. COMMITMENTS AND CONTINGENCIES | |
Litigation and Regulatory Proceedings | |
In the ordinary course of business, we are involved in judicial and administrative proceedings involving federal, state, provincial or local governmental authorities, including regulatory agencies that oversee and enforce compliance with permits. Fines or penalties may be assessed by our regulators for non-compliance. Actions may also be brought by individuals or groups in connection with permitting of planned facilities, modification or alleged violations of existing permits, or alleged damages suffered from exposure to hazardous substances purportedly released from our operated sites, as well as other litigation. We maintain insurance intended to cover property and damage claims asserted as a result of our operations. Periodically, management reviews and may establish reserves for legal and administrative matters, or other fees expected to be incurred in relation to these matters. | |
In 2012, we settled allegations by the United States Environment Protection Agency (“U.S. EPA”) that the thermal recycling operation at our Robstown, Texas facility did not comply with certain rules and regulations of the Resource Conservation and Recovery Act of 1976 (“RCRA”). As part of the settlement, we agreed to pay a civil penalty and to submit an application to the State of Texas for a RCRA Subpart X permit. The Company and the thermal recycling unit’s owner-operator also agreed to a set of interim operating conditions that allow the facility to continue providing recycling services to customers until the RCRA Subpart X permit is issued. | |
In connection with this matter, in June 2013 the U.S. EPA asserted various related technical compliance and permitting violations of the Clean Air Act of 1970. Negotiations on the merits of a proposed settlement are ongoing with the U.S. EPA. We recognized a charge of $238,000 during the second quarter of 2013 in Selling, general and administrative expenses in the Consolidated Statement of Operations related to this pending enforcement matter. | |
Other than as disclosed above, we are not currently a party to any material pending legal proceedings and are not aware of any other claims that could, individually or in the aggregate, have a materially adverse effect on our financial position, results of operations or cash flows. | |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
EARNINGS PER SHARE | ' | |||||||||||||
EARNINGS PER SHARE | ' | |||||||||||||
NOTE 12. EARNINGS PER SHARE | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
$s and shares in thousands, except per share | 2014 | 2013 | ||||||||||||
amounts | Basic | Diluted | Basic | Diluted | ||||||||||
Net income | 9,361 | $ | 9,361 | $ | 5,406 | $ | 5,406 | |||||||
Weighted average basic shares outstanding | 21,475 | 21,475 | 18,320 | 18,320 | ||||||||||
Dilutive effect of stock options and restricted stock | 111 | 87 | ||||||||||||
Weighted average diluted shares outstanding | 21,586 | 18,407 | ||||||||||||
Earnings per share | $ | 0.44 | $ | 0.43 | $ | 0.3 | $ | 0.29 | ||||||
Anti-dilutive shares excluded from calculation | 36 | 221 | ||||||||||||
EQUITY
EQUITY | 3 Months Ended |
Mar. 31, 2014 | |
EQUITY | ' |
EQUITY | ' |
NOTE 13. EQUITY | |
During the three months ended March 31, 2014, option holders exercised 10,208 options with a weighted-average exercise price of $17.01 per option. During the three months ended March 31, 2014, the Company repurchased 4,860 shares of the Company’s common stock in connection with net share settlement of employee equity awards at an average cost of $38.22 per share and issued 5,625 shares of restricted stock from our treasury stock at an average cost of $21.01 per share. | |
OPERATING_SEGMENTS
OPERATING SEGMENTS | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
OPERATING SEGMENTS | ' | |||||||||||||
OPERATING SEGMENTS | ' | |||||||||||||
NOTE 14. OPERATING SEGMENTS | ||||||||||||||
We operate within two segments, Operating Disposal Facilities and Non-Operating Disposal Facilities. These segments reflect our internal reporting structure and nature of services offered. The Operating Disposal Facility segment represents disposal facilities accepting hazardous and radioactive waste. The Non-Operating Disposal Facility segment represents facilities which are not accepting hazardous and/or radioactive waste or formerly proposed new facilities. | ||||||||||||||
Income taxes are assigned to Corporate, but all other items are included in the segment where they originated. Inter-company transactions have been eliminated from the segment information and are not significant between segments. | ||||||||||||||
Summarized financial information concerning our reportable segments is shown in the following tables: | ||||||||||||||
Three Months Ended March 31, 2014 (in thousands) | Operating | Non- | Corporate | Total | ||||||||||
Disposal | Operating | |||||||||||||
Facilities | Disposal | |||||||||||||
Facilities | ||||||||||||||
Revenue - Treatment and disposal | $ | 44,942 | $ | 5 | $ | — | $ | 44,947 | ||||||
Revenue - Transportation services | 8,407 | — | — | 8,407 | ||||||||||
Total revenue | 53,349 | 5 | — | 53,354 | ||||||||||
Direct operating costs | 22,571 | 50 | — | 22,621 | ||||||||||
Transportation costs | 8,613 | — | — | 8,613 | ||||||||||
Gross profit (loss) | 22,165 | (45 | ) | — | 22,120 | |||||||||
Selling, general & administrative expense | 2,599 | — | 4,037 | 6,636 | ||||||||||
Operating income (loss) | 19,566 | (45 | ) | (4,037 | ) | 15,484 | ||||||||
Interest income (expense), net | 3 | — | (45 | ) | (42 | ) | ||||||||
Foreign currency gain (loss) | 380 | — | (1,320 | ) | (940 | ) | ||||||||
Other income | 84 | 2 | — | 86 | ||||||||||
Income (loss) before income taxes | 20,033 | (43 | ) | (5,402 | ) | 14,588 | ||||||||
Income tax expense | — | — | 5,227 | 5,227 | ||||||||||
Net income (loss) | $ | 20,033 | $ | (43 | ) | $ | (10,629 | ) | $ | 9,361 | ||||
Depreciation, amortization & accretion | $ | 4,459 | $ | 48 | $ | 14 | $ | 4,521 | ||||||
Capital expenditures | $ | 4,550 | $ | 43 | $ | 182 | $ | 4,775 | ||||||
Total assets | $ | 155,032 | $ | 117 | $ | 145,007 | $ | 300,156 | ||||||
Three Months Ended March 31, 2013 (in thousands) | Operating | Non- | Corporate | Total | ||||||||||
Disposal | Operating | |||||||||||||
Facilities | Disposal | |||||||||||||
Facilities | ||||||||||||||
Revenue - Treatment and disposal | $ | 36,340 | $ | 4 | $ | — | $ | 36,344 | ||||||
Revenue - Transportation services | 6,555 | — | — | 6,555 | ||||||||||
Total revenue | 42,895 | 4 | — | 42,899 | ||||||||||
Direct operating costs | 21,031 | 53 | — | 21,084 | ||||||||||
Transportation costs | 6,433 | — | — | 6,433 | ||||||||||
Gross profit (loss) | 15,431 | (49 | ) | — | 15,382 | |||||||||
Selling, general & administrative expense | 2,646 | — | 3,080 | 5,726 | ||||||||||
Operating income (loss) | 12,785 | (49 | ) | (3,080 | ) | 9,656 | ||||||||
Interest income (expense), net | 4 | — | (220 | ) | (216 | ) | ||||||||
Foreign currency gain (loss) | 112 | — | (1,050 | ) | (938 | ) | ||||||||
Other income | 95 | 2 | — | 97 | ||||||||||
Income (loss) before income taxes | 12,996 | (47 | ) | (4,350 | ) | 8,599 | ||||||||
Income tax expense | — | — | 3,193 | 3,193 | ||||||||||
Net income (loss) | $ | 12,996 | $ | (47 | ) | $ | (7,543 | ) | $ | 5,406 | ||||
Depreciation, amortization & accretion | $ | 4,051 | $ | 52 | $ | 10 | $ | 4,113 | ||||||
Capital expenditures | $ | 6,726 | $ | — | $ | 26 | $ | 6,752 | ||||||
Total assets | $ | 211,620 | $ | 86 | $ | 8,240 | $ | 219,946 | ||||||
Revenue, Property and Equipment and Intangible Assets Outside of the United States | ||||||||||||||
We provide services in the United States and Canada. Revenues by geographic location where the underlying services were performed consisted of the following: | ||||||||||||||
Geographic disclosure | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
$s in thousands | 2014 | 2013 | ||||||||||||
United States | $ | 37,270 | $ | 31,398 | ||||||||||
Canada | 16,084 | 11,501 | ||||||||||||
Total revenue | $ | 53,354 | $ | 42,899 | ||||||||||
Long-lived assets, comprised of property and equipment and intangible assets net of accumulated depreciation and amortization, by geographic location consisted of the following: | ||||||||||||||
March 31, | December 31, | |||||||||||||
$s in thousands | 2014 | 2013 | ||||||||||||
United States | $ | 88,803 | $ | 86,175 | ||||||||||
Canada | 62,803 | 65,516 | ||||||||||||
Total long-lived assets | $ | 151,606 | $ | 151,691 |
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2014 | |
SUBSEQUENT EVENTS | ' |
SUBSEQUENT EVENTS | ' |
NOTE 15. SUBSEQUENT EVENTS | |
Quarterly Dividend | |
On April 1, 2014, we declared a quarterly dividend of $0.18 per common share to stockholders of record on April 21, 2014. The dividend was paid using cash on hand on April 28, 2014 in an aggregate amount of $3.9 million. | |
Proposed Business Acquisition | |
On April 7, 2014, the Company announced that it has entered into a definitive stock purchase agreement to acquire EQ — The Environmental Quality Company (“EQ”). EQ is a comprehensive waste solutions provider with facilities throughout the Eastern United States offering a broad line of environmental services including treatment and disposal of hazardous wastes, recycling, field and industrial services and total waste management. EQ’s facilities include one hazardous waste permitted landfill located outside of Detroit, Michigan, 13 waste treatment and recycling facilities and 21 dedicated service centers. | |
The transaction, valued at $465.0 million, is expected to close in the second or third quarter of 2014 and is subject to customary closing conditions, including a purchase price adjustment based on the amount of working capital at closing. The total purchase price will be financed using a combination of cash on hand and committed debt financing, consisting of a new $540.0 million credit facility comprised of a $415.0 million 7-year Term Loan and a $125.0 million 5-year Revolving Credit Facility. In connection with the transaction, the Company executed a debt commitment letter with affiliates of Wells Fargo and Credit Suisse pursuant to which Wells Fargo and Credit Suisse committed to act as Joint Arrangers for the new credit facility. The debt commitment is subject to customary terms and conditions, including the negotiation of the terms of the new definitive credit agreement. | |
GENERAL_Policies
GENERAL (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
GENERAL | ' |
Basis of presentation | ' |
Basis of Presentation | |
The accompanying unaudited consolidated financial statements include the results of operations, financial position and cash flows of US Ecology, Inc. and its wholly-owned subsidiaries. All significant intercompany balances have been eliminated. Throughout these financial statements words such as “we,” “us,” “our,” “US Ecology” and the “Company” refer to US Ecology, Inc. and its subsidiaries. | |
In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments necessary to present fairly, in all material respects, the results of the Company for the periods presented. These consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been omitted pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. The results of operations and cash flows for the three months ended March 31, 2014 are not necessarily indicative of results to be expected for the entire fiscal year. | |
The Company’s Consolidated Balance Sheet as of December 31, 2013 has been derived from the Company’s audited Consolidated Balance Sheet as of that date. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from the estimates and assumptions that we use in the preparation of our financial statements. As it relates to estimates and assumptions in amortization rates and environmental obligations, significant engineering, operations and accounting judgments are required. We review these estimates and assumptions no less than annually. In many circumstances, the ultimate outcome of these estimates and assumptions will not be known for decades into the future. Actual results could differ materially from these estimates and assumptions due to changes in applicable regulations, changes in future operational plans and inherent imprecision associated with estimating environmental impacts far into the future. | |
Restricted Cash and Investments | ' |
Restricted Cash and Investments | |
Restricted cash and investments of $4.1 million at March 31, 2014 and 2013 represent funds held in third-party managed trust accounts as collateral for our financial assurance obligations for post-closure activities at our non-operating facilities. These funds are invested in fixed-income U.S. Treasury and government agency securities and money market accounts. The balances are adjusted monthly to fair market value based on quoted prices in active markets for identical or similar assets. | |
ACCUMULATED_OTHER_COMPREHENSIV1
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ' | |||||||
Schedule of changes in accumulated other comprehensive income (loss) | ' | |||||||
Three Months Ended March 31, | ||||||||
$s in thousands | 2014 | 2013 | ||||||
Balance, beginning of period | $ | (1,785 | ) | $ | 628 | |||
Foreign currency translation gain (loss) in other comprehensive income | (1,479 | ) | (750 | ) | ||||
Balance, end of period | $ | (3,264 | ) | $ | (122 | ) |
RECEIVABLES_Tables
RECEIVABLES (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
RECEIVABLES | ' | |||||||
Schedule of receivables | ' | |||||||
March 31, | December 31, | |||||||
$s in thousands | 2014 | 2013 | ||||||
Trade | $ | 39,012 | $ | 42,055 | ||||
Unbilled revenue | 1,678 | 1,296 | ||||||
Other | 1,381 | 810 | ||||||
Total receivables | 42,071 | 44,161 | ||||||
Allowance for doubtful accounts | (393 | ) | (525 | ) | ||||
Receivables, net | $ | 41,678 | $ | 43,636 |
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
PROPERTY AND EQUIPMENT | ' | |||||||
Schedule of property and equipment | ' | |||||||
March 31, | December 31, | |||||||
$s in thousands | 2014 | 2013 | ||||||
Cell development costs | $ | 81,004 | $ | 77,348 | ||||
Land and improvements | 17,967 | 18,073 | ||||||
Buildings and improvements | 58,515 | 59,101 | ||||||
Railcars | 17,375 | 17,375 | ||||||
Vehicles and other equipment | 43,847 | 42,859 | ||||||
Construction in progress | 7,292 | 6,784 | ||||||
Total property and equipment | 226,000 | 221,540 | ||||||
Accumulated depreciation and amortization | (109,581 | ) | (106,681 | ) | ||||
Property and equipment, net | $ | 116,419 | $ | 114,859 |
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
FAIR VALUE MEASUREMENTS | ' | |||||||||||||
Schedule of assets measured at fair value on a recurring basis | ' | |||||||||||||
March 31, 2014 | ||||||||||||||
Quoted Prices in | Other Observable | Unobservable | ||||||||||||
Active Markets | Inputs | Inputs | ||||||||||||
$s in thousands | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Assets: | ||||||||||||||
Fixed-income securities (1) | $ | 399 | $ | 3,611 | $ | — | $ | 4,010 | ||||||
Money market funds (2) | $ | 101 | $ | — | $ | — | $ | 101 | ||||||
Total | $ | 500 | $ | 3,611 | $ | — | $ | 4,111 | ||||||
December 31, 2013 | ||||||||||||||
Quoted Prices in | Other Observable | Unobservable | ||||||||||||
Active Markets | Inputs | Inputs | ||||||||||||
$s in thousands | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||
Assets: | ||||||||||||||
Fixed-income securities (1) | $ | 399 | $ | 3,607 | $ | — | $ | 4,006 | ||||||
Money market funds (2) | $ | 91 | $ | — | $ | — | $ | 91 | ||||||
Total | $ | 490 | $ | 3,607 | $ | — | $ | 4,097 | ||||||
(1) We invest a portion of our Restricted cash and investments in fixed-income securities, including U.S. Treasury and U.S. agency securities. We measure the fair value of U.S. Treasury securities using quoted prices for identical assets in active markets. We measure the fair value of U.S. agency securities using observable market activity for similar assets. The fair value of our fixed-income securities approximates our cost basis in the investments. | ||||||||||||||
(2) We invest a portion of our Restricted cash and investments in money market funds. We measure the fair value of these money market fund investments using quoted prices for identical assets in active markets. |
GOODWILL_AND_INTANGIBLE_ASSETS1
GOODWILL AND INTANGIBLE ASSETS (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
GOODWILL AND INTANGIBLE ASSETS | ' | |||||||
Schedule of changes in goodwill | ' | |||||||
$s in thousands | Goodwill | |||||||
Balance at December 31, 2013 | $ | 21,693 | ||||||
Foreign currency translation | (752 | ) | ||||||
Balance at March 31, 2014 | $ | 20,941 | ||||||
Schedule of intangible assets | ' | |||||||
$s in thousands | March 31, | December 31, | ||||||
2014 | 2013 | |||||||
Amortizing intangible assets: | ||||||||
Developed software | $ | 317 | $ | 329 | ||||
Database | 90 | 94 | ||||||
Customer relationships | 4,863 | 5,005 | ||||||
Technology - Formulae and processes | 8,235 | 8,551 | ||||||
Permits, licenses and lease | 25,294 | 26,264 | ||||||
Non-compete agreements | 20 | 20 | ||||||
Total amortizing intangible assets | 38,819 | 40,263 | ||||||
Accumulated amortization | (4,536 | ) | (4,341 | ) | ||||
Nonamortizing intangible assets: | ||||||||
Permits and licenses | 750 | 750 | ||||||
Tradename | 154 | 160 | ||||||
Total intangible assets, net | $ | 35,187 | $ | 36,832 |
CLOSURE_AND_POSTCLOSURE_OBLIGA1
CLOSURE AND POST-CLOSURE OBLIGATIONS (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
CLOSURE AND POST-CLOSURE OBLIGATIONS | ' | ||||
Schedule of changes in closure and post-closure obligations | ' | ||||
Three Months Ended | |||||
$s in thousands | March 31, 2014 | ||||
Closure and post-closure obligations, beginning of period | $ | 17,468 | |||
Accretion expense | 330 | ||||
Payments | (114 | ) | |||
Adjustments | 2,863 | ||||
Currency translation | (79 | ) | |||
Closure and post-closure obligations, end of period | 20,468 | ||||
Less current portion | (916 | ) | |||
Long-term portion | $ | 19,552 |
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
EARNINGS PER SHARE | ' | |||||||||||||
Schedule of earnings per share | ' | |||||||||||||
Three Months Ended March 31, | ||||||||||||||
$s and shares in thousands, except per share | 2014 | 2013 | ||||||||||||
amounts | Basic | Diluted | Basic | Diluted | ||||||||||
Net income | 9,361 | $ | 9,361 | $ | 5,406 | $ | 5,406 | |||||||
Weighted average basic shares outstanding | 21,475 | 21,475 | 18,320 | 18,320 | ||||||||||
Dilutive effect of stock options and restricted stock | 111 | 87 | ||||||||||||
Weighted average diluted shares outstanding | 21,586 | 18,407 | ||||||||||||
Earnings per share | $ | 0.44 | $ | 0.43 | $ | 0.3 | $ | 0.29 | ||||||
Anti-dilutive shares excluded from calculation | 36 | 221 | ||||||||||||
OPERATING_SEGMENTS_Tables
OPERATING SEGMENTS (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
OPERATING SEGMENTS | ' | |||||||||||||
Summary of financial information concerning reportable segments | ' | |||||||||||||
Three Months Ended March 31, 2014 (in thousands) | Operating | Non- | Corporate | Total | ||||||||||
Disposal | Operating | |||||||||||||
Facilities | Disposal | |||||||||||||
Facilities | ||||||||||||||
Revenue - Treatment and disposal | $ | 44,942 | $ | 5 | $ | — | $ | 44,947 | ||||||
Revenue - Transportation services | 8,407 | — | — | 8,407 | ||||||||||
Total revenue | 53,349 | 5 | — | 53,354 | ||||||||||
Direct operating costs | 22,571 | 50 | — | 22,621 | ||||||||||
Transportation costs | 8,613 | — | — | 8,613 | ||||||||||
Gross profit (loss) | 22,165 | (45 | ) | — | 22,120 | |||||||||
Selling, general & administrative expense | 2,599 | — | 4,037 | 6,636 | ||||||||||
Operating income (loss) | 19,566 | (45 | ) | (4,037 | ) | 15,484 | ||||||||
Interest income (expense), net | 3 | — | (45 | ) | (42 | ) | ||||||||
Foreign currency gain (loss) | 380 | — | (1,320 | ) | (940 | ) | ||||||||
Other income | 84 | 2 | — | 86 | ||||||||||
Income (loss) before income taxes | 20,033 | (43 | ) | (5,402 | ) | 14,588 | ||||||||
Income tax expense | — | — | 5,227 | 5,227 | ||||||||||
Net income (loss) | $ | 20,033 | $ | (43 | ) | $ | (10,629 | ) | $ | 9,361 | ||||
Depreciation, amortization & accretion | $ | 4,459 | $ | 48 | $ | 14 | $ | 4,521 | ||||||
Capital expenditures | $ | 4,550 | $ | 43 | $ | 182 | $ | 4,775 | ||||||
Total assets | $ | 155,032 | $ | 117 | $ | 145,007 | $ | 300,156 | ||||||
Three Months Ended March 31, 2013 (in thousands) | Operating | Non- | Corporate | Total | ||||||||||
Disposal | Operating | |||||||||||||
Facilities | Disposal | |||||||||||||
Facilities | ||||||||||||||
Revenue - Treatment and disposal | $ | 36,340 | $ | 4 | $ | — | $ | 36,344 | ||||||
Revenue - Transportation services | 6,555 | — | — | 6,555 | ||||||||||
Total revenue | 42,895 | 4 | — | 42,899 | ||||||||||
Direct operating costs | 21,031 | 53 | — | 21,084 | ||||||||||
Transportation costs | 6,433 | — | — | 6,433 | ||||||||||
Gross profit (loss) | 15,431 | (49 | ) | — | 15,382 | |||||||||
Selling, general & administrative expense | 2,646 | — | 3,080 | 5,726 | ||||||||||
Operating income (loss) | 12,785 | (49 | ) | (3,080 | ) | 9,656 | ||||||||
Interest income (expense), net | 4 | — | (220 | ) | (216 | ) | ||||||||
Foreign currency gain (loss) | 112 | — | (1,050 | ) | (938 | ) | ||||||||
Other income | 95 | 2 | — | 97 | ||||||||||
Income (loss) before income taxes | 12,996 | (47 | ) | (4,350 | ) | 8,599 | ||||||||
Income tax expense | — | — | 3,193 | 3,193 | ||||||||||
Net income (loss) | $ | 12,996 | $ | (47 | ) | $ | (7,543 | ) | $ | 5,406 | ||||
Depreciation, amortization & accretion | $ | 4,051 | $ | 52 | $ | 10 | $ | 4,113 | ||||||
Capital expenditures | $ | 6,726 | $ | — | $ | 26 | $ | 6,752 | ||||||
Total assets | $ | 211,620 | $ | 86 | $ | 8,240 | $ | 219,946 | ||||||
Summary of revenues by geographic location | ' | |||||||||||||
Three Months Ended March 31, | ||||||||||||||
$s in thousands | 2014 | 2013 | ||||||||||||
United States | $ | 37,270 | $ | 31,398 | ||||||||||
Canada | 16,084 | 11,501 | ||||||||||||
Total revenue | $ | 53,354 | $ | 42,899 | ||||||||||
Schedule of long-lived assets by geographic location | ' | |||||||||||||
March 31, | December 31, | |||||||||||||
$s in thousands | 2014 | 2013 | ||||||||||||
United States | $ | 88,803 | $ | 86,175 | ||||||||||
Canada | 62,803 | 65,516 | ||||||||||||
Total long-lived assets | $ | 151,606 | $ | 151,691 |
GENERAL_Details
GENERAL (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 |
In Thousands, unless otherwise specified | |||
Restricted Cash and Investments | ' | ' | ' |
Restricted cash and investments | $4,111 | $4,097 | $4,100 |
ACCUMULATED_OTHER_COMPREHENSIV2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Changes in accumulated other comprehensive income (loss) | ' | ' |
Balance at the beginning of the period | ($1,785) | $628 |
Foreign currency translation gain (loss) in other comprehensive income | -1,479 | -750 |
Balance at the end of the period | ($3,264) | ($122) |
CONCENTRATIONS_AND_CREDIT_RISK1
CONCENTRATIONS AND CREDIT RISK (Details) (Major Customers, One customer) | 3 Months Ended | 0 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | |
Total revenue | Total trade receivables | Total trade receivables | |
CONCENTRATIONS AND CREDIT RISK | ' | ' | ' |
Concentration of risk (as a percent) | 11.00% | 16.00% | 16.00% |
RECEIVABLES_Details
RECEIVABLES (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
RECEIVABLES | ' | ' |
Trade | $39,012 | $42,055 |
Unbilled revenue | 1,678 | 1,296 |
Other | 1,381 | 810 |
Total receivables | 42,071 | 44,161 |
Allowance for doubtful accounts | -393 | -525 |
Receivables, net | $41,678 | $43,636 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
PROPERTY AND EQUIPMENT | ' | ' | ' |
Total property and equipment | $226,000 | ' | $221,540 |
Accumulated depreciation and amortization | -109,581 | ' | -106,681 |
Property and equipment, net | 116,419 | ' | 114,859 |
Depreciation and amortization expense | 3,839 | 3,439 | ' |
Cell development costs | ' | ' | ' |
PROPERTY AND EQUIPMENT | ' | ' | ' |
Total property and equipment | 81,004 | ' | 77,348 |
Land and improvements | ' | ' | ' |
PROPERTY AND EQUIPMENT | ' | ' | ' |
Total property and equipment | 17,967 | ' | 18,073 |
Buildings and improvements | ' | ' | ' |
PROPERTY AND EQUIPMENT | ' | ' | ' |
Total property and equipment | 58,515 | ' | 59,101 |
Railcars | ' | ' | ' |
PROPERTY AND EQUIPMENT | ' | ' | ' |
Total property and equipment | 17,375 | ' | 17,375 |
Vehicles and other equipment | ' | ' | ' |
PROPERTY AND EQUIPMENT | ' | ' | ' |
Total property and equipment | 43,847 | ' | 42,859 |
Construction in progress | ' | ' | ' |
PROPERTY AND EQUIPMENT | ' | ' | ' |
Total property and equipment | $7,292 | ' | $6,784 |
FAIR_VALUE_MEASUREMENTS_Detail
FAIR VALUE MEASUREMENTS (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Other Observable Inputs (Level 2) | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | ' | $3,607 |
Recurring | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | 4,111 | 4,097 |
Recurring | Fixed-income securities | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | 4,010 | 4,006 |
Recurring | Money market funds | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | 101 | 91 |
Recurring | Quoted Prices in Active Markets (Level 1) | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | 500 | 490 |
Recurring | Quoted Prices in Active Markets (Level 1) | Fixed-income securities | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | 399 | 399 |
Recurring | Quoted Prices in Active Markets (Level 1) | Money market funds | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | 101 | 91 |
Recurring | Other Observable Inputs (Level 2) | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | 3,611 | ' |
Recurring | Other Observable Inputs (Level 2) | Fixed-income securities | ' | ' |
Assets measured at fair value on a recurring basis | ' | ' |
Assets fair value disclosure | $3,611 | $3,607 |
GOODWILL_AND_INTANGIBLE_ASSETS2
GOODWILL AND INTANGIBLE ASSETS (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Oct. 30, 2010 |
GOODWILL AND INTANGIBLE ASSETS | ' | ' | ' | ' |
Goodwill and intangible assets | ' | ' | ' | $0 |
Changes in goodwill | ' | ' | ' | ' |
Balance at the beginning of the period | 21,693 | ' | ' | ' |
Foreign currency translation | -752 | ' | ' | ' |
Balance at the end of the period | 20,941 | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Total amortizing intangible assets | 38,819 | ' | 40,263 | ' |
Accumulated amortization | -4,536 | ' | -4,341 | ' |
Total intangible assets, net | 35,187 | ' | 36,832 | ' |
Amortization expense | 352 | 367 | ' | ' |
Permits and licenses | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Nonamortizing intangible assets | 750 | ' | 750 | ' |
Tradename | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Nonamortizing intangible assets | 154 | ' | 160 | ' |
Developed software | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Total amortizing intangible assets | 317 | ' | 329 | ' |
Database | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Total amortizing intangible assets | 90 | ' | 94 | ' |
Customer relationships | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Total amortizing intangible assets | 4,863 | ' | 5,005 | ' |
Technology - Formulae and processes | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Total amortizing intangible assets | 8,235 | ' | 8,551 | ' |
Permits, licenses and lease | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Total amortizing intangible assets | 25,294 | ' | 26,264 | ' |
Non-compete agreements | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' |
Total amortizing intangible assets | $20 | ' | $20 | ' |
DEBT_Details
DEBT (Details) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
DEBT | ' |
Maximum borrowing capacity | $95,000,000 |
Revolving Line of Credit | ' |
DEBT | ' |
Maximum borrowing capacity | 20,000,000 |
Effective interest rate (as a percent) | 1.40% |
Amount outstanding | 0 |
Availability for borrowings under line of credit | 19,700,000 |
Line of credit issued in the form of a standby letter of credit | 257,000 |
Reducing Revolving Line of Credit | ' |
DEBT | ' |
Maximum borrowing capacity | 75,000,000 |
Reduction in commitment amount for each quarter | 2,800,000 |
Effective interest rate (as a percent) | 1.40% |
Amount outstanding | 0 |
Availability for borrowings under line of credit | $61,100,000 |
CLOSURE_AND_POSTCLOSURE_OBLIGA2
CLOSURE AND POST-CLOSURE OBLIGATIONS (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Changes to reported closure and post-closure obligations | ' | ' | ' |
Closure and post-closure obligations, beginning of period | $17,468 | ' | ' |
Accretion expense | 330 | 307 | ' |
Payments | -114 | ' | ' |
Adjustments | 2,863 | ' | ' |
Currency translation | -79 | ' | ' |
Closure and post-closure obligations, end of period | 20,468 | ' | ' |
Less current portion | -916 | ' | -949 |
Long-term portion | $19,552 | ' | $16,519 |
INCOME_TAXES_Details
INCOME TAXES (Details) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
INCOME TAXES | ' | ' |
Effective tax rate (as a percent) | 35.80% | 37.10% |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Details) (US Ecology and the thermal recycling operation owner-operator, USD $) | 3 Months Ended |
Jun. 30, 2013 | |
US Ecology and the thermal recycling operation owner-operator | ' |
Litigation and Regulatory Proceedings | ' |
Amount recognized in selling, general and administrative expenses regarding asserted various technical compliance and permitting violations of the Clean Air Act of 1970 | $238,000 |
EARNINGS_PER_SHARE_Details
EARNINGS PER SHARE (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Basic | ' | ' |
Net income | $9,361 | $5,406 |
Weighted average basic shares outstanding | 21,475 | 18,320 |
Earnings per share (in dollars per share) | $0.44 | $0.30 |
Diluted | ' | ' |
Net income | $9,361 | $5,406 |
Weighted average basic shares outstanding | 21,475 | 18,320 |
Dilutive effect of stock options and restricted stock (in shares) | 111 | 87 |
Weighted average diluted shares outstanding | 21,586 | 18,407 |
Earnings per share (in dollars per share) | $0.43 | $0.29 |
Anti-dilutive shares excluded from calculation | 36 | 221 |
EQUITY_Details
EQUITY (Details) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
EQUITY | ' |
Number of options exercised (in shares) | 10,208 |
Weighted-average exercise price of options exercised (in dollars per share) | $17.01 |
Repurchase of common stock (in shares) | 4,860 |
Average cost of repurchase (in dollars per share) | $38.22 |
Issuance of restricted stock from treasury stock (in shares) | 5,625 |
Average cost (in dollars per share) | $21.01 |
OPERATING_SEGMENTS_Details
OPERATING SEGMENTS (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
segment | |||
OPERATING SEGMENTS | ' | ' | ' |
Number of reportable segments | 2 | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | $53,354 | $42,899 | ' |
Direct operating costs | 22,621 | 21,084 | ' |
Transportation costs | 8,613 | 6,433 | ' |
Gross profit | 22,120 | 15,382 | ' |
Selling, general & administrative expenses | 6,636 | 5,726 | ' |
Operating income | 15,484 | 9,656 | ' |
Interest income (expense), net | -42 | -216 | ' |
Foreign currency gain (loss) | -940 | -938 | ' |
Other income | 86 | 97 | ' |
Income before income taxes | 14,588 | 8,599 | ' |
Income tax expense | 5,227 | 3,193 | ' |
Net income | 9,361 | 5,406 | ' |
Depreciation, amortization & accretion | 4,521 | 4,113 | ' |
Capital expenditures | 4,775 | 6,752 | ' |
Total assets | 300,156 | 219,946 | 300,556 |
Treatment and disposal | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | 44,947 | 36,344 | ' |
Transportation services | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | 8,407 | 6,555 | ' |
Operating Segment | Operating Disposal Facilities | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | 53,349 | 42,895 | ' |
Direct operating costs | 22,571 | 21,031 | ' |
Transportation costs | 8,613 | 6,433 | ' |
Gross profit | 22,165 | 15,431 | ' |
Selling, general & administrative expenses | 2,599 | 2,646 | ' |
Operating income | 19,566 | 12,785 | ' |
Interest income (expense), net | 3 | 4 | ' |
Foreign currency gain (loss) | 380 | 112 | ' |
Other income | 84 | 95 | ' |
Income before income taxes | 20,033 | 12,996 | ' |
Net income | 20,033 | 12,996 | ' |
Depreciation, amortization & accretion | 4,459 | 4,051 | ' |
Capital expenditures | 4,550 | 6,726 | ' |
Total assets | 155,032 | 211,620 | ' |
Operating Segment | Operating Disposal Facilities | Treatment and disposal | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | 44,942 | 36,340 | ' |
Operating Segment | Operating Disposal Facilities | Transportation services | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | 8,407 | 6,555 | ' |
Operating Segment | Non-Operating Disposal Facilities | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | 5 | 4 | ' |
Direct operating costs | 50 | 53 | ' |
Gross profit | -45 | -49 | ' |
Operating income | -45 | -49 | ' |
Other income | 2 | 2 | ' |
Income before income taxes | -43 | -47 | ' |
Net income | -43 | -47 | ' |
Depreciation, amortization & accretion | 48 | 52 | ' |
Capital expenditures | 43 | ' | ' |
Total assets | 117 | 86 | ' |
Operating Segment | Non-Operating Disposal Facilities | Treatment and disposal | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Revenue | 5 | 4 | ' |
Corporate | ' | ' | ' |
OPERATING SEGMENTS | ' | ' | ' |
Selling, general & administrative expenses | 4,037 | 3,080 | ' |
Operating income | -4,037 | -3,080 | ' |
Interest income (expense), net | -45 | -220 | ' |
Foreign currency gain (loss) | -1,320 | -1,050 | ' |
Income before income taxes | -5,402 | -4,350 | ' |
Income tax expense | 5,227 | 3,193 | ' |
Net income | -10,629 | -7,543 | ' |
Depreciation, amortization & accretion | 14 | 10 | ' |
Capital expenditures | 182 | 26 | ' |
Total assets | $145,007 | $8,240 | ' |
OPERATING_SEGMENTS_Details_2
OPERATING SEGMENTS (Details 2) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Revenue, Property and Equipment and Intangible Assets Outside of the United States | ' | ' | ' |
Total revenue | $53,354 | $42,899 | ' |
Total long- lived assets | 151,606 | ' | 151,691 |
United States | ' | ' | ' |
Revenue, Property and Equipment and Intangible Assets Outside of the United States | ' | ' | ' |
Total revenue | 37,270 | 31,398 | ' |
Total long- lived assets | 88,803 | ' | 86,175 |
Canada | ' | ' | ' |
Revenue, Property and Equipment and Intangible Assets Outside of the United States | ' | ' | ' |
Total revenue | 16,084 | 11,501 | ' |
Total long- lived assets | $62,803 | ' | $65,516 |
SUBSEQUENT_EVENTS_Details
SUBSEQUENT EVENTS (Details) (USD $) | 3 Months Ended | 0 Months Ended | 0 Months Ended | |||||
Mar. 31, 2014 | Mar. 31, 2014 | Apr. 28, 2014 | Apr. 02, 2014 | Apr. 07, 2014 | Apr. 07, 2014 | Apr. 07, 2014 | Apr. 07, 2014 | |
5-year Revolving Credit Facility | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | Subsequent event | ||
EQ | EQ | EQ | EQ | |||||
landfill | Credit facility | 7-year Term Loan | 5-year Revolving Credit Facility | |||||
facility | ||||||||
center | ||||||||
SUBSEQUENT EVENTS | ' | ' | ' | ' | ' | ' | ' | ' |
Quarterly dividend declared (in dollars per share) | ' | ' | ' | $0.18 | ' | ' | ' | ' |
Dividend paid in cash | $3,874,000 | ' | $3,900,000 | ' | ' | ' | ' | ' |
Number of hazardous waste permitted landfill | ' | ' | ' | ' | 1 | ' | ' | ' |
Number of waste treatment and recycling facility | ' | ' | ' | ' | 13 | ' | ' | ' |
Number of dedicated service centers | ' | ' | ' | ' | 21 | ' | ' | ' |
Business acquisition transaction value | ' | ' | ' | ' | 465,000,000 | ' | ' | ' |
Credit facility, maximum borrowing capacity | $95,000,000 | $20,000,000 | ' | ' | ' | $540,000,000 | $415,000,000 | $125,000,000 |
Term of debt | ' | ' | ' | ' | ' | ' | '7 years | '5 years |