Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 30, 2020 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-32472 | |
Entity Registrant Name | DAWSON GEOPHYSICAL COMPANY | |
Entity Incorporation, State or Country Code | TX | |
Entity Tax Identification Number | 74-2095844 | |
Entity Address, Address Line One | 508 West Wall, Suite 800 | |
Entity Address, City or Town | Midland | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 79701 | |
City Area Code | 432 | |
Local Phone Number | 684-3000 | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Security Exchange Name | NASDAQ | |
Trading Symbol | DWSN | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 23,478,072 | |
Entity Central Index Key | 0000799165 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 45,422 | $ 26,271 |
Restricted cash | 5,000 | 5,000 |
Short-term investments | 583 | 2,350 |
Accounts receivable, net | 4,987 | 24,356 |
Current maturities of notes receivable | 1,434 | 66 |
Prepaid expenses and other current assets | 3,499 | 7,575 |
Total current assets | 60,925 | 65,618 |
Property and equipment, net | 42,449 | 53,549 |
Right-of-use assets | 5,736 | 6,605 |
Notes receivable, net of current maturities | 1,394 | |
Intangibles, net | 375 | 385 |
Long-term deferred tax assets, net | 57 | |
Total assets | 109,485 | 127,608 |
Current liabilities: | ||
Accounts payable | 908 | 3,952 |
Accrued liabilities: | ||
Payroll costs and other taxes | 1,230 | 1,963 |
Other | 2,304 | 3,599 |
Deferred revenue | 374 | 3,481 |
Current maturities of notes payable and finance leases | 215 | 4,062 |
Current maturities of operating lease liabilities | 1,097 | 1,200 |
Total current liabilities | 6,128 | 18,257 |
Long-term liabilities: | ||
Notes payable and finance leases, net of current maturities | 51 | 96 |
Operating lease liabilities, net of current maturities | 5,157 | 5,940 |
Deferred tax liabilities, net | 22 | |
Other accrued liabilities | 150 | |
Total long-term liabilities | 5,230 | 6,186 |
Operating commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock-par value $1.00 per share; 4,000,000 shares authorized, none outstanding | ||
Common stock-par value $0.01 per share; 35,000,000 shares authorized, 23,526,517 and 23,335,855 shares issued, and 23,478,072 and 23,287,410 shares outstanding at September 30, 2020 and December 31, 2019, respectively | 235 | 233 |
Additional paid-in capital | 154,763 | 154,235 |
Retained deficit | (55,078) | (49,731) |
Treasury stock, at cost; 48,445 shares | ||
Accumulated other comprehensive loss, net | (1,793) | (1,572) |
Total stockholders' equity | 98,127 | 103,165 |
Total liabilities and stockholders' equity | $ 109,485 | $ 127,608 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized | 4,000,000 | 4,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 35,000,000 | 35,000,000 |
Common stock, shares issued | 23,526,517 | 23,335,855 |
Common stock, shares outstanding | 23,478,072 | 23,287,410 |
Treasury stock, shares | 48,445 | 48,445 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME | ||||
Operating revenues | $ 8,738 | $ 36,976 | $ 77,216 | $ 112,216 |
Operating costs: | ||||
Operating expenses | 9,441 | 26,030 | 58,189 | 92,210 |
General and administrative | 3,270 | 3,797 | 11,205 | 13,390 |
Depreciation and amortization | 4,125 | 5,238 | 13,412 | 16,644 |
Total cost and expenses | 16,836 | 35,065 | 82,806 | 122,244 |
(Loss) income from operations | (8,098) | 1,911 | (5,590) | (10,028) |
Other income (expense): | ||||
Interest income | 106 | 152 | 326 | 445 |
Interest expense | (10) | (101) | (80) | (381) |
Other income (expense), net | 177 | 11 | 12 | 433 |
(Loss) income before income tax | (7,825) | 1,973 | (5,332) | (9,531) |
Income tax (expense) benefit | (15) | 25 | (15) | 146 |
Net (loss) income | (7,840) | 1,998 | (5,347) | (9,385) |
Other comprehensive income (loss): | ||||
Net unrealized income (loss) on foreign exchange rate translation, net | 374 | (103) | (221) | 280 |
Comprehensive (loss) income | $ (7,466) | $ 1,895 | $ (5,568) | $ (9,105) |
Basic (loss) income per share of common stock | $ (0.33) | $ 0.09 | $ (0.23) | $ (0.41) |
Diluted (loss) income per share of common stock | $ (0.33) | $ 0.09 | $ (0.23) | $ (0.41) |
Weighted average equivalent common shares outstanding | 23,423,437 | 23,222,045 | 23,350,204 | 23,152,776 |
Weighted average equivalent common shares outstanding - assuming dilution | 23,423,437 | 23,337,903 | 23,350,204 | 23,152,776 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (5,347) | $ (9,385) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 13,412 | 16,644 |
Operating lease cost | 916 | 903 |
Non-cash compensation | 600 | 951 |
Deferred income tax expense (benefit) | 79 | (209) |
Change in other accrued long-term liabilities | (150) | |
Gain on disposal of assets | (3) | (85) |
Remeasurement and other | 68 | (118) |
Change in operating assets and liabilities: | ||
Decrease (increase) in accounts receivable | 19,373 | (10,549) |
Decrease in prepaid expenses and other assets | 4,505 | 2,303 |
(Decrease) increase in accounts payable | (2,957) | 1,793 |
(Decrease) increase in accrued liabilities | (2,011) | 2,332 |
Decrease in operating lease liabilities | (930) | (852) |
Decrease in deferred revenue | (3,107) | (2,531) |
Net cash provided by operating activities | 24,448 | 1,197 |
Cash flows from investing activities: | ||
Capital expenditures, net of non-cash capital expenditures summarized below | (2,822) | (3,649) |
Proceeds from maturity of short-term investments | 1,767 | 28,000 |
Acquisition of short-term investments | (24,842) | |
Proceeds from disposal of assets | 225 | 272 |
Proceeds from notes receivable | 26 | 38 |
Net cash used in investing activities | (804) | (181) |
Cash flows from financing activities: | ||
Proceeds from notes payable | 6,374 | |
Principal payments on notes payable | (8,393) | (7,867) |
Principal payments on finance leases | (2,291) | (2,126) |
Tax withholdings related to stock-based compensation awards | (70) | (236) |
Net cash used in financing activities | (4,380) | (10,229) |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | (113) | 154 |
Net increase (decrease) in cash and cash equivalents and restricted cash | 19,151 | (9,059) |
Cash and cash equivalents and restricted cash at beginning of period | 31,271 | 28,729 |
Cash and cash equivalents and restricted cash at end of period | 50,422 | 19,670 |
Supplemental cash flow information: | ||
Cash paid for interest | 89 | 390 |
Cash paid for income taxes | 83 | 14 |
Cash received for income taxes | 206 | 55 |
Non-cash operating, investing and financing activities: | ||
Decrease in accrued purchases of property and equipment | (61) | (928) |
Finance leases incurred | 121 | |
Increase in right-of-use assets and operating lease liabilities | 63 | 8,226 |
Decrease in right-of-use assets for accrued rent | (497) | |
Increase in right-of-use assets for prepaid rent | 3 | 14 |
Financed insurance premiums | $ 433 | $ 337 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Deficit | Accumulated Other Comprehensive (Loss) Income | Total |
Balance at beginning of period at Dec. 31, 2018 | $ 230 | $ 153,268 | $ (34,518) | $ (1,964) | $ 117,016 |
Balance at beginning of period (in shares) at Dec. 31, 2018 | 23,018,441 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | (137) | (137) | |||
Unrealized income (loss) on foreign exchange rate translation | 269 | ||||
Income tax expense (benefit) | (60) | ||||
Other comprehensive income (loss) | 209 | 209 | |||
Issuance of common stock under stock compensation plans | $ 2 | (2) | |||
Issuance of common stock under stock compensation plans (in shares) | 229,459 | ||||
Stock-based compensation expense | 297 | 297 | |||
Issuance of common stock as compensation | 73 | 73 | |||
Issuance of common stock as compensation (in shares) | 24,785 | ||||
Shares exchanged for taxes on stock-based compensation | (206) | (206) | |||
Shares exchanged for taxes on stock-based compensation (in shares) | (53,201) | ||||
Balance at end of period at Mar. 31, 2019 | $ 232 | 153,430 | (34,655) | (1,755) | 117,252 |
Balance at end of period (in shares) at Mar. 31, 2019 | 23,219,484 | ||||
Balance at beginning of period at Dec. 31, 2018 | $ 230 | 153,268 | (34,518) | (1,964) | 117,016 |
Balance at beginning of period (in shares) at Dec. 31, 2018 | 23,018,441 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | (9,385) | ||||
Balance at end of period at Sep. 30, 2019 | $ 233 | 153,980 | (43,903) | (1,684) | 108,626 |
Balance at end of period (in shares) at Sep. 30, 2019 | 23,305,950 | ||||
Balance at beginning of period at Mar. 31, 2019 | $ 232 | 153,430 | (34,655) | (1,755) | 117,252 |
Balance at beginning of period (in shares) at Mar. 31, 2019 | 23,219,484 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | (11,246) | (11,246) | |||
Unrealized income (loss) on foreign exchange rate translation | 224 | ||||
Income tax expense (benefit) | (50) | ||||
Other comprehensive income (loss) | 174 | 174 | |||
Issuance of common stock under stock compensation plans (in shares) | 34,000 | ||||
Stock-based compensation expense | 221 | 221 | |||
Issuance of common stock as compensation | $ 1 | 73 | 74 | ||
Issuance of common stock as compensation (in shares) | 29,016 | ||||
Shares exchanged for taxes on stock-based compensation | (30) | (30) | |||
Shares exchanged for taxes on stock-based compensation (in shares) | (12,400) | ||||
Balance at end of period at Jun. 30, 2019 | $ 233 | 153,694 | (45,901) | (1,581) | 106,445 |
Balance at end of period (in shares) at Jun. 30, 2019 | 23,270,100 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | 1,998 | 1,998 | |||
Unrealized income (loss) on foreign exchange rate translation | (133) | ||||
Income tax expense (benefit) | 30 | ||||
Other comprehensive income (loss) | (103) | (103) | |||
Stock-based compensation expense | 209 | 209 | |||
Issuance of common stock as compensation | 77 | 77 | |||
Issuance of common stock as compensation (in shares) | 35,850 | ||||
Balance at end of period at Sep. 30, 2019 | $ 233 | 153,980 | (43,903) | (1,684) | 108,626 |
Balance at end of period (in shares) at Sep. 30, 2019 | 23,305,950 | ||||
Balance at beginning of period at Dec. 31, 2019 | $ 233 | 154,235 | (49,731) | (1,572) | $ 103,165 |
Balance at beginning of period (in shares) at Dec. 31, 2019 | 23,335,855 | 23,287,410 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | 993 | $ 993 | |||
Unrealized income (loss) on foreign exchange rate translation | (1,199) | ||||
Other comprehensive income (loss) | (1,199) | (1,199) | |||
Stock-based compensation expense | 203 | 203 | |||
Balance at end of period at Mar. 31, 2020 | $ 233 | 154,438 | (48,738) | (2,771) | 103,162 |
Balance at end of period (in shares) at Mar. 31, 2020 | 23,335,855 | ||||
Balance at beginning of period at Dec. 31, 2019 | $ 233 | 154,235 | (49,731) | (1,572) | $ 103,165 |
Balance at beginning of period (in shares) at Dec. 31, 2019 | 23,335,855 | 23,287,410 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | $ (5,347) | ||||
Balance at end of period at Sep. 30, 2020 | $ 235 | 154,763 | (55,078) | (1,793) | $ 98,127 |
Balance at end of period (in shares) at Sep. 30, 2020 | 23,526,517 | 23,478,072 | |||
Balance at beginning of period at Mar. 31, 2020 | $ 233 | 154,438 | (48,738) | (2,771) | $ 103,162 |
Balance at beginning of period (in shares) at Mar. 31, 2020 | 23,335,855 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | 1,500 | 1,500 | |||
Unrealized income (loss) on foreign exchange rate translation | 604 | ||||
Other comprehensive income (loss) | 604 | 604 | |||
Issuance of common stock under stock compensation plans | $ 1 | (1) | |||
Issuance of common stock under stock compensation plans (in shares) | 78,600 | ||||
Stock-based compensation expense | 271 | 271 | |||
Shares exchanged for taxes on stock-based compensation | (17) | (17) | |||
Shares exchanged for taxes on stock-based compensation (in shares) | (15,420) | ||||
Balance at end of period at Jun. 30, 2020 | $ 234 | 154,691 | (47,238) | (2,167) | 105,520 |
Balance at end of period (in shares) at Jun. 30, 2020 | 23,399,035 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net income (loss) | (7,840) | (7,840) | |||
Unrealized income (loss) on foreign exchange rate translation | 374 | ||||
Other comprehensive income (loss) | 374 | 374 | |||
Issuance of common stock under stock compensation plans | $ 2 | (2) | |||
Issuance of common stock under stock compensation plans (in shares) | 157,500 | ||||
Stock-based compensation expense | 126 | 126 | |||
Shares exchanged for taxes on stock-based compensation | $ (1) | (52) | (53) | ||
Shares exchanged for taxes on stock-based compensation (in shares) | (30,018) | ||||
Balance at end of period at Sep. 30, 2020 | $ 235 | $ 154,763 | $ (55,078) | $ (1,793) | $ 98,127 |
Balance at end of period (in shares) at Sep. 30, 2020 | 23,526,517 | 23,478,072 |
ORGANIZATION AND NATURE OF OPER
ORGANIZATION AND NATURE OF OPERATIONS | 9 Months Ended |
Sep. 30, 2020 | |
ORGANIZATION AND NATURE OF OPERATIONS | |
ORGANIZATION AND NATURE OF OPERATIONS | 1. ORGANIZATION AND NATURE OF OPERATIONS Dawson Geophysical Company (the “Company”) is a leading provider of North American onshore seismic data acquisition services with operations throughout the continental United States (“U.S.”) and Canada. The Company acquires and processes 2-D, 3-D and multicomponent seismic data solely for its clients, ranging from major oil and gas companies to independent oil and gas operators as well as providers of multi-client data libraries. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of the Company. Intercompany accounts and transactions have been eliminated. In the opinion of the Company’s management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. The preparation of these condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in these condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Certain prior period amounts in the condensed consolidated financial statements may have been reclassified to conform to the current period’s presentation. These condensed consolidated financial statements have been prepared using accounting principles generally accepted in the U.S. for interim financial information and the instructions to Form 10-Q and applicable rules of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in annual financial statements presented in accordance with accounting principles generally accepted in the U.S. have been omitted. These condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s annual consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Significant Accounting Policies Principles of Consolidation. Allowance for Doubtful Accounts. In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (“Topic 326”): Measurement of Credit Losses on Financial Instruments, which requires entities to measure expected credit losses for certain financial assets using a new, forward-looking current expected credit loss model (“CECL”) that will result in the earlier recognition of allowances for losses. Subsequent ASUs were issued to provide additional guidance. On January 1, 2020, the Company adopted Topic 326 using the modified retrospective method. The provisions of Topic 326 did not significantly impact the method or timing that the Company recognizes expected credit losses and the cumulative effect of adoption was immaterial on its consolidated financial statements. The Company’s financial instruments within the scope of this guidance primarily includes trade receivables. The Company’s allowance for doubtful accounts was $250,000 at September 30, 2020 and December 31, 2019. Notes Receivable. payable to the Company under the note receivable are fully collateralized by the specific dynamite energy source drilling equipment sold to the note payor. This financial instrument also falls within the scope of Topic 326. Leases Property and Equipment. Impairment of Long-lived Assets . Stock-Based Compensation Use of Estimates in the Preparation of Financial Statements. Revenue Recognition The Company receives reimbursements for certain out-of-pocket expenses under the terms of the service contracts. The amounts billed to clients are included at their gross amount in the total estimated revenue for the service contract. Clients are billed as permitted by the service contract. Contract assets and contract liabilities are the result of timing differences between revenue recognition, billings and cash collections. If billing occurs prior to the revenue recognition or billing exceeds the revenue recognized, the amount is considered deferred revenue and a contract liability. Conversely, if the revenue recognition exceeds the billing, the excess is considered an unbilled receivable and a contract asset. As services are performed, those deferred revenue amounts are recognized as revenue. In some instances, third-party permitting, surveying, drilling, helicopter, equipment rental and mobilization costs that directly relate to the contract are utilized to fulfill the contract obligations. These fulfillment costs are capitalized in other current assets and generally amortized based on the total square miles of data recorded compared to total square miles anticipated to be recorded on the survey using the total estimated fulfillment costs for the service contract. Estimates for total revenue and total fulfillment cost on any service contract are based on significant qualitative and quantitative judgments. Management considers a variety of factors such as whether various components of the performance obligation will be performed internally or externally, cost of third party services and facts and circumstances unique to the performance obligation in making these estimates. Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes by eliminating certain exceptions to the general principles in Topic 740 and by clarifying and amending existing guidance to improve consistent application. This ASU is effective for the annual period beginning after December 15, 2020, including interim periods within that annual period. Certain amendments within this ASU are required to be applied on a retrospective basis for all periods presented; others are to be applied using a modified retrospective approach with a cumulative-effect adjustment to retained earnings, if any, as of the beginning of the first reporting period in which the guidance is adopted; and yet others are to be applied using either basis. All other amendments not specified in the ASU should be applied on a prospective basis. Early adoption is permitted. An entity that elects to early adopt in an interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period. Additionally, an entity that elects early adoption must adopt all the amendments in the same period. The Company is currently evaluating the new guidance to determine the impact it will have on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosure requirements on fair value measurement by removing, modifying, and adding certain disclosures. This ASU is effective for the annual period beginning after December 15, 2019, including interim periods within that annual period. The Company adopted this guidance in the first quarter of 2020 and it did not have a material impact on its consolidated financial statements. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2020 | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3. FAIR VALUE OF FINANCIAL INSTRUMENTS At September 30, 2020 and December 31, 2019, the Company’s financial instruments included cash and cash equivalents, restricted cash, short-term investments in certificates of deposit, accounts receivable, notes receivable, other current assets, accounts payable, other current liabilities, notes payable, finance leases and operating lease liabilities. Due to the short-term maturities of cash and cash equivalents, restricted cash, accounts receivable, other current assets, accounts payable and other current liabilities, the carrying amounts approximate fair value at the respective balance sheet dates. The carrying value of the notes receivable, notes payable, finance leases and operating lease liabilities approximate their fair value based on a comparison with the prevailing market interest rate. Due to the short-term maturities of the Company’s investments in certificates of deposit, the carrying amounts approximate fair value at the respective balance sheet dates. The fair values of the Company’s notes receivable, notes payable and investments in certificates of deposit are level 2 measurements in the fair value hierarchy. |
SUPPLEMENTAL CONSOLIDATED FINAN
SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION | 9 Months Ended |
Sep. 30, 2020 | |
SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION | |
SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION | 4 . SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION Disaggregated Revenues The Company has one line of business, acquiring and processing seismic data in North America. Our chief operating decision maker (President, Chief Executive Officer and Chairman of the Board) makes operating decisions and assesses performance based on the Company as a whole. Accordingly, the Company is considered to be in a single reportable segment. The following table presents the Company’s operating revenues (unaudited and in thousands) disaggregated by geographic region: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating Revenues United States $ 8,738 $ 36,814 $ 65,408 $ 96,496 Canada — 162 11,808 15,720 Total $ 8,738 $ 36,976 $ 77,216 $ 112,216 Deferred Costs (in thousands) Deferred costs are included within prepaid expenses and other current assets. The opening balance of deferred costs was $2,525 and $6,994 at January 1, 2020 and 2019, respectively. The amount of deferred costs incurred to fulfill contracts with customers at September 30, 2020 and 2019 was $417 and $7,001, respectively. Deferred costs at September 30, 2020 compared to January 1, 2020 decreased primarily as a result of the completion of several projects during that nine month period that had significant deferred fulfillment costs at January 1, 2020. Deferred costs at September 30, 2019 compared to January 1, 2019 remained fairly consistent. The amount of total deferred costs amortized for the three and nine months ended September 30, 2020 was $1,128 and $12,023, respectively. The amount of total deferred costs amortized for the three and nine months ended September 30, 2019 was $6,806 and $27,253, respectively. There were no material impairment losses incurred during these periods. Deferred Revenue (in thousands) The opening balance of deferred revenue was $3,481 and $10,501 at January 1, 2020 and 2019, respectively. The Company’s deferred revenue at September 30, 2020 and 2019 was $374 and $7,970, respectively. Deferred revenue at September 30, 2020 compared to January 1, 2020 and at September 30, 2019 compared to January 1, 2019 decreased primarily as a result of completing projects for clients with large prepayments for third party reimbursables. Revenue recognized for the three and nine months ended September 30, 2020 that was included in the contract liability balance at the beginning of 2020 was $129 and $3,476, respectively. Revenue recognized for the three and nine months ended September 30, 2019 that was included in the contract liability balance at the beginning of 2019 was $427 and $8,604, respectively. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2020 | |
DEBT | |
DEBT | 5 . DEBT Dominion Loan Agreement On September 30, 2019, the Company entered into a Loan and Security Agreement with Dominion Bank, a Texas state bank (“Dominion Bank”). On September 30, 2020, the Company entered into a Loan Modification Agreement to the Loan and Security Agreement (as amended by the Loan Modification Agreement, the “Loan Agreement”) for the purpose of amending and extending the maturity of the Company’s line of credit with Dominion Bank by one year. The Loan Agreement provides for a revolving credit facility (the “Revolving Credit Facility”) in an amount up to the lesser of (i) $15,000,000 or (ii) a sum equal to (a) 80% of the Company’s eligible accounts receivable plus 100% of the amount on deposit with Dominion Bank in the Company’s collateral account, consisting of a restricted CDARS account of $5,000,000 (the “Deposit”). As of September 30, 2020, the Company has not borrowed any amounts under the Revolving Credit Facility. Under the Revolving Credit Facility, interest will accrue at an annual rate equal to the lesser of (i) 6.00% and (ii) the greater of (a) the prime rate as published from time to time in The Wall Street Journal or (b) 3.50%. The Company will pay a commitment fee of 0.10% per annum on the difference of (a) $15,000,000 minus the Deposit minus (b) the daily average usage of the Revolving Credit Facility. The Loan Agreement contains customary covenants for credit facilities of this type, including limitations on disposition of assets. The Company is also obligated to meet certain financial covenants under the Loan Agreement, including maintaining a tangible net worth of $75,000,000 and specified ratios with respect to current assets and liabilities and debt to tangible net worth. The Company’s obligations under the Loan Agreement are secured by a security interest in the collateral account (including the Deposit) with Dominion Bank and future accounts receivable and related collateral. The maturity date of the Loan Agreement is September 30, 2021. The Company does not currently have any notes payable under the Revolving Credit Facility. Veritex Letters of Credit As of September 30, 2020, Veritex Community Bank (“Veritex”) had issued two letters of credit to the Company, each of which were secured by a certificate of deposit with Veritex. The first letter of credit was in the amount of $1,767,000 to support payment of certain insurance obligations of the Company. The second letter of credit was in the amount of $583,000 to support the Company’s workers compensation insurance. During October of 2020, the letter of credit in the amount of $1,767,000 to support payment of certain insurance obligations of the Company was terminated at the request of the Company because the beneficiary no longer required it to secure such obligations. Also during October of 2020, Veritex, at the Company’s request, terminated the second letter of credit in the amount of $583,000 to support the Company’s workers compensation insurance and the Company simultaneously had a replacement letter of credit issued Other Indebtedness (in thousands) As of September 30, 2020, the Company has one note payable to a finance company for various insurance premiums totaling $160,000. In addition, the Company leases certain seismic recording equipment and vehicles under leases classified as finance leases. The Company’s Condensed Consolidated Balance Sheets as of September 30, 2020 include finance leases of $106,000. Maturities and Interest Rates of Debt The following tables set forth the aggregate principal amount (in thousands) under the Company’s outstanding notes payable and the interest rates as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Notes payable to finance company for insurance Aggregate principal amount outstanding $ 160 $ 1,746 Interest rate 4.99% 4.05% - 4.99% The aggregate maturities of notes payable as of September 30, 2020 are as follows (in thousands): October 2020 - September 2021 $ 160 Total notes payable $ 160 The aggregate maturities of finance leases as of September 30, 2020 are as follows (in thousands): October 2020 - September 2021 $ 55 October 2021 - September 2022 41 October 2022 - September 2023 10 Obligations under finance leases $ 106 Interest rates on these leases range from 4.83% to 5.37%. |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2020 | |
LEASES | |
LEASES | 6. LEASES The Company leases certain vehicles, seismic recording equipment, real property and office equipment under lease agreements. The Company evaluates each lease to determine its appropriate classification as an operating lease or finance lease for financial reporting purposes. The majority of our operating leases are non-cancelable operating leases for office and shop space in Midland, Plano, Denison, Houston, Denver, Oklahoma City and Calgary, Alberta. The components of lease cost for the three and nine months ended September 30, 2020 and 2019 was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Finance lease cost Amortization of right-of-use assets $ 333 $ 359 $ 1,033 $ 1,062 Interest on lease liabilities 6 41 45 144 Total finance lease cost 339 400 1,078 1,206 Operating lease cost 391 388 1,166 1,197 Short-term lease cost — — — — Total lease cost $ 730 $ 788 $ 2,244 $ 2,403 Supplemental cash flow information related to leases for the nine months ended September 30, 2020 and 2019 was as follows (in thousands): Nine Months Ended September 30, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ (1,183) $ (1,115) Operating cash flows from finance leases $ (49) $ (148) Financing cash flows from finance leases $ (2,291) $ (2,126) Right-of-use assets obtained in exchange for lease obligations Operating leases $ 63 $ 8,226 Finance leases $ — $ 121 Supplemental balance sheet information related to leases as of September 30, 2020 and December 31, 2019 was as follows (in thousands): September 30, December 31, 2020 2019 Operating leases Operating lease right-of-use assets $ 5,736 $ 6,605 Operating lease liabilities - current $ 1,097 $ 1,200 Operating lease liabilities - long-term 5,157 5,940 Total operating lease liabilities $ 6,254 $ 7,140 Finance leases Property and equipment, at cost $ 8,663 $ 8,663 Accumulated depreciation (4,267) (3,297) Property and equipment, net $ 4,396 $ 5,366 Finance lease liabilities - current $ 55 $ 2,316 Finance lease liabilities - long-term 51 96 Total finance lease liabilities $ 106 $ 2,412 Weighted average remaining lease term Operating leases 5.8 years 6.3 years Finance leases 1.8 years 0.8 years Weighted average discount rate Operating leases 5.04% 5.04% Finance leases 4.99% 4.67% Maturities of lease liabilities as of September 30, 2020 are as follows (in thousands): Operating Leases Finance Leases October 2020 - September 2021 $ 1,386 $ 60 October 2021 - September 2022 1,234 42 October 2022 - September 2023 1,157 10 October 2023 - September 2024 1,180 — October 2024 - September 2025 941 — Thereafter 1,343 — Total payments under lease agreements 7,241 112 Less imputed interest (987) (6) Total lease liabilities $ 6,254 $ 106 |
OPERATING COMMITMENTS AND CONTI
OPERATING COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
OPERATING COMMITMENTS AND CONTINGENCIES | |
OPERATING COMMITMENTS AND CONTINGENCIES | 7 . OPERATING COMMITMENTS AND CONTINGENCIES From time to time, the Company is a party to various legal proceedings arising in the ordinary course of business. Although the Company cannot predict the outcomes of any such legal proceedings, management believes that the resolution of pending legal actions will not have a material adverse effect on the Company’s financial condition, results of operations or liquidity, as the Company believes it is adequately indemnified and insured. We are also party to the following legal proceeding: On April 1, 2019, Weatherford International, LLC and Weatherford U.S., L.P. (collectively, “Weatherford”) filed a petition in state district court for Midland County, Texas, in which the Company and eighteen other parties were named as defendants, alleging the Company and/or the other named defendants contributed to or caused contamination of groundwater at and around property owned by Weatherford. Weatherford is seeking declaratory judgment, recovery and contribution for past and future costs incurred in responding to or correcting the contamination at and around the property from each defendant. The Company disputes Weatherford’s allegations with respect to the Company and intends to vigorously defend itself in this case. Subsequent to the filing of the petition, Weatherford filed for bankruptcy protection on July 1, 2019. While the outcome and impact of this legal proceeding on the Company cannot be predicted with certainty, based on currently available information management believes that the resolution of this proceeding will not have a material adverse effect on our financial condition, results of operations or liquidity. Additionally, the Company experiences contractual disputes with its clients from time to time regarding the payment of invoices or other matters. While the Company seeks to minimize these disputes and maintain good relations with its clients, the Company has experienced in the past, and may experience in the future, disputes that could affect its revenues and results of operations in any period. |
NET (LOSS) INCOME PER SHARE
NET (LOSS) INCOME PER SHARE | 9 Months Ended |
Sep. 30, 2020 | |
NET (LOSS) INCOME PER SHARE | |
NET (LOSS) INCOME PER SHARE | 8. NET (LOSS) INCOME PER SHARE Basic net (loss) income per share is computed by dividing the net (loss) income by the weighted average shares outstanding. Diluted (loss) income per share is computed by dividing the net (loss) income by the weighted average diluted shares outstanding. The computation of basic and diluted (loss) income per share was as follows (in thousands, except share and per share data): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net (loss) income $ (7,840) $ 1,998 $ (5,347) $ (9,385) Weighted average common shares outstanding Basic 23,423,437 23,222,045 23,350,204 23,152,776 Dilutive common stock options, restricted stock unit awards and restricted stock awards — 115,858 — — Diluted 23,423,437 23,337,903 23,350,204 23,152,776 Basic (loss) income per share of common stock $ (0.33) $ 0.09 $ (0.23) $ (0.41) Diluted (loss) income per share of common stock $ (0.33) $ 0.09 $ (0.23) $ (0.41) The Company had a net loss for the three and nine months ended September 30, 2020 and for the nine months ended September 30, 2019. As a result, all stock options, restricted stock unit awards and restricted stock awards were anti-dilutive and excluded from weighted average shares used in determining the diluted loss per share of common stock for those periods. The Company had net income for the three months ended September 30, 2019 The following weighted average numbers of stock options, restricted stock unit awards and restricted stock awards have been excluded from the calculation of diluted (loss) income per share of common stock, as their effect would be anti-dilutive for the three and nine months ended September 30, 2020 and 2019: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Stock options — — — 67,625 Restricted stock units 242,478 222,000 332,868 471,624 Restricted stock awards — — — 10,874 Total 242,478 222,000 332,868 550,123 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2020 | |
INCOME TAXES | |
INCOME TAXES | 9 . INCOME TAXES For the three and nine months ended September 30, 2020, the Company's effective tax rate was -0.2% and -0.3%, respectively. For the three and nine months ended September 30, 2019, the Company’s effective tax rate was -1.3% and 1.5%, respectively. The Company’s effective tax rate decreased compared to the corresponding period from the prior year primarily due to a 2019 PP&E-related tax adjustment. The Company assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit the use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over an extended amount of time. Such objective evidence limits the ability to consider other subjective evidence, such as projections for taxable earnings. The income tax expense for the three and nine months ended September 30, 2020 is due to current state tax expense. The Company does not include income tax benefits for all of the losses incurred because the Company has recorded valuation allowances against significantly all of its Federal, state and foreign deferred tax assets. The Company has recorded valuation allowances against the associated deferred tax assets for the amounts it deems are not more likely than not realizable. Based on management’s belief that not all the net operating losses are realizable, a Federal valuation allowance, a foreign valuation allowance, and additional state valuation allowances were maintained during the nine months ended September 30, 2020 and 2019. In addition, due to the Company’s recent operating losses and valuation allowances, the Company may recognize reduced or no tax benefits on future losses on the condensed consolidated financial statements. The amount of the valuation allowances considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased, or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as projections for future growth. On March 27, 2020, Congress passed and the President signed into law the Coronavirus Aid, Relief, and Economic Security Act which included significant changes to U.S. Federal income tax law. However, the only change that is expected to affect the Company is the acceleration of the ability to take the remainder of its refundable minimum tax credit. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2020 | |
SUBSEQUENT EVENTS. | |
SUBSEQUENT EVENTS | 10. SUBSEQUENT EVENTS None. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of Consolidation | Principles of Consolidation. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts. In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (“Topic 326”): Measurement of Credit Losses on Financial Instruments, which requires entities to measure expected credit losses for certain financial assets using a new, forward-looking current expected credit loss model (“CECL”) that will result in the earlier recognition of allowances for losses. Subsequent ASUs were issued to provide additional guidance. On January 1, 2020, the Company adopted Topic 326 using the modified retrospective method. The provisions of Topic 326 did not significantly impact the method or timing that the Company recognizes expected credit losses and the cumulative effect of adoption was immaterial on its consolidated financial statements. The Company’s financial instruments within the scope of this guidance primarily includes trade receivables. The Company’s allowance for doubtful accounts was $250,000 at September 30, 2020 and December 31, 2019. |
Notes Receivable | Notes Receivable. payable to the Company under the note receivable are fully collateralized by the specific dynamite energy source drilling equipment sold to the note payor. This financial instrument also falls within the scope of Topic 326. |
Leases | Leases |
Property and Equipment | Property and Equipment. |
Impairment of Long-lived Assets | Impairment of Long-lived Assets . |
Stock-Based Compensation | Stock-Based Compensation |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements. |
Revenue Recognition | Revenue Recognition The Company receives reimbursements for certain out-of-pocket expenses under the terms of the service contracts. The amounts billed to clients are included at their gross amount in the total estimated revenue for the service contract. Clients are billed as permitted by the service contract. Contract assets and contract liabilities are the result of timing differences between revenue recognition, billings and cash collections. If billing occurs prior to the revenue recognition or billing exceeds the revenue recognized, the amount is considered deferred revenue and a contract liability. Conversely, if the revenue recognition exceeds the billing, the excess is considered an unbilled receivable and a contract asset. As services are performed, those deferred revenue amounts are recognized as revenue. In some instances, third-party permitting, surveying, drilling, helicopter, equipment rental and mobilization costs that directly relate to the contract are utilized to fulfill the contract obligations. These fulfillment costs are capitalized in other current assets and generally amortized based on the total square miles of data recorded compared to total square miles anticipated to be recorded on the survey using the total estimated fulfillment costs for the service contract. Estimates for total revenue and total fulfillment cost on any service contract are based on significant qualitative and quantitative judgments. Management considers a variety of factors such as whether various components of the performance obligation will be performed internally or externally, cost of third party services and facts and circumstances unique to the performance obligation in making these estimates. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (“Topic 740”): Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes by eliminating certain exceptions to the general principles in Topic 740 and by clarifying and amending existing guidance to improve consistent application. This ASU is effective for the annual period beginning after December 15, 2020, including interim periods within that annual period. Certain amendments within this ASU are required to be applied on a retrospective basis for all periods presented; others are to be applied using a modified retrospective approach with a cumulative-effect adjustment to retained earnings, if any, as of the beginning of the first reporting period in which the guidance is adopted; and yet others are to be applied using either basis. All other amendments not specified in the ASU should be applied on a prospective basis. Early adoption is permitted. An entity that elects to early adopt in an interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period. Additionally, an entity that elects early adoption must adopt all the amendments in the same period. The Company is currently evaluating the new guidance to determine the impact it will have on its consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosure requirements on fair value measurement by removing, modifying, and adding certain disclosures. This ASU is effective for the annual period beginning after December 15, 2019, including interim periods within that annual period. The Company adopted this guidance in the first quarter of 2020 and it did not have a material impact on its consolidated financial statements. |
SUPPLEMENTAL CONSOLIDATED FIN_2
SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION | |
Schedule of operating revenues disaggregated by geographic region | Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating Revenues United States $ 8,738 $ 36,814 $ 65,408 $ 96,496 Canada — 162 11,808 15,720 Total $ 8,738 $ 36,976 $ 77,216 $ 112,216 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
DEBT | |
Schedule of aggregate principal amount of outstanding notes payable and the interest rates | The following tables set forth the aggregate principal amount (in thousands) under the Company’s outstanding notes payable and the interest rates as of September 30, 2020 and December 31, 2019: September 30, 2020 December 31, 2019 Notes payable to finance company for insurance Aggregate principal amount outstanding $ 160 $ 1,746 Interest rate 4.99% 4.05% - 4.99% |
Schedule of aggregate maturities of notes payable | The aggregate maturities of notes payable as of September 30, 2020 are as follows (in thousands): October 2020 - September 2021 $ 160 Total notes payable $ 160 |
Schedule of aggregate maturities of finance leases | The aggregate maturities of finance leases as of September 30, 2020 are as follows (in thousands): October 2020 - September 2021 $ 55 October 2021 - September 2022 41 October 2022 - September 2023 10 Obligations under finance leases $ 106 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
LEASES | |
Schedule of expense, cash flow information and balance sheet information related to operating and finance leases | The components of lease cost for the three and nine months ended September 30, 2020 and 2019 was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Finance lease cost Amortization of right-of-use assets $ 333 $ 359 $ 1,033 $ 1,062 Interest on lease liabilities 6 41 45 144 Total finance lease cost 339 400 1,078 1,206 Operating lease cost 391 388 1,166 1,197 Short-term lease cost — — — — Total lease cost $ 730 $ 788 $ 2,244 $ 2,403 Supplemental cash flow information related to leases for the nine months ended September 30, 2020 and 2019 was as follows (in thousands): Nine Months Ended September 30, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ (1,183) $ (1,115) Operating cash flows from finance leases $ (49) $ (148) Financing cash flows from finance leases $ (2,291) $ (2,126) Right-of-use assets obtained in exchange for lease obligations Operating leases $ 63 $ 8,226 Finance leases $ — $ 121 Supplemental balance sheet information related to leases as of September 30, 2020 and December 31, 2019 was as follows (in thousands): September 30, December 31, 2020 2019 Operating leases Operating lease right-of-use assets $ 5,736 $ 6,605 Operating lease liabilities - current $ 1,097 $ 1,200 Operating lease liabilities - long-term 5,157 5,940 Total operating lease liabilities $ 6,254 $ 7,140 Finance leases Property and equipment, at cost $ 8,663 $ 8,663 Accumulated depreciation (4,267) (3,297) Property and equipment, net $ 4,396 $ 5,366 Finance lease liabilities - current $ 55 $ 2,316 Finance lease liabilities - long-term 51 96 Total finance lease liabilities $ 106 $ 2,412 Weighted average remaining lease term Operating leases 5.8 years 6.3 years Finance leases 1.8 years 0.8 years Weighted average discount rate Operating leases 5.04% 5.04% Finance leases 4.99% 4.67% |
Schedule of maturities of lease liabilities | Maturities of lease liabilities as of September 30, 2020 are as follows (in thousands): Operating Leases Finance Leases October 2020 - September 2021 $ 1,386 $ 60 October 2021 - September 2022 1,234 42 October 2022 - September 2023 1,157 10 October 2023 - September 2024 1,180 — October 2024 - September 2025 941 — Thereafter 1,343 — Total payments under lease agreements 7,241 112 Less imputed interest (987) (6) Total lease liabilities $ 6,254 $ 106 |
NET (LOSS) INCOME PER SHARE (Ta
NET (LOSS) INCOME PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
NET (LOSS) INCOME PER SHARE | |
Schedule of computation of basic and diluted (loss) income per share | The computation of basic and diluted (loss) income per share was as follows (in thousands, except share and per share data): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net (loss) income $ (7,840) $ 1,998 $ (5,347) $ (9,385) Weighted average common shares outstanding Basic 23,423,437 23,222,045 23,350,204 23,152,776 Dilutive common stock options, restricted stock unit awards and restricted stock awards — 115,858 — — Diluted 23,423,437 23,337,903 23,350,204 23,152,776 Basic (loss) income per share of common stock $ (0.33) $ 0.09 $ (0.23) $ (0.41) Diluted (loss) income per share of common stock $ (0.33) $ 0.09 $ (0.23) $ (0.41) |
Schedule of weighted average numbers of stock options, restricted stock unit awards, and restricted stock awards that have been excluded from the calculation of diluted (loss) income per share of common stock | Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Stock options — — — 67,625 Restricted stock units 242,478 222,000 332,868 471,624 Restricted stock awards — — — 10,874 Total 242,478 222,000 332,868 550,123 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 9 Months Ended | |
Sep. 30, 2020USD ($)item | Dec. 31, 2019USD ($) | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Allowance for doubtful accounts | $ | $ 250,000 | $ 250,000 |
Number of notes receivable | item | 1 | |
Maximum original expected duration of cancelable service contracts | 1 year |
SUPPLEMENTAL CONSOLIDATED FIN_3
SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION - Disaggregated Revenues (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)segment | Sep. 30, 2019USD ($) | |
Number of business segments | segment | 1 | |||
Operating revenues | $ 8,738 | $ 36,976 | $ 77,216 | $ 112,216 |
United States | ||||
Operating revenues | $ 8,738 | 36,814 | 65,408 | 96,496 |
Canada | ||||
Operating revenues | $ 162 | $ 11,808 | $ 15,720 |
SUPPLEMENTAL CONSOLIDATED FIN_4
SUPPLEMENTAL CONSOLIDATED FINANCIAL STATEMENT INFORMATION - Deferred Costs and Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Jan. 01, 2020 | Dec. 31, 2019 | Jan. 01, 2019 | |
Total deferred costs amortized | $ 1,128 | $ 6,806 | $ 12,023 | $ 27,253 | |||
Deferred revenue | 374 | 7,970 | 374 | 7,970 | $ 3,481 | $ 3,481 | $ 10,501 |
Revenue recognized that was included in deferred revenue balances at beginning of period | 129 | 427 | 3,476 | 8,604 | |||
Prepaid expenses and other current assets | |||||||
Deferred Costs | $ 417 | $ 7,001 | $ 417 | $ 7,001 | $ 2,525 | $ 6,994 |
DEBT (Details)
DEBT (Details) | Sep. 30, 2020USD ($)item | Sep. 30, 2019USD ($) | Oct. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
DEBT | ||||
Restricted CDARS account | $ 5,000,000 | $ 5,000,000 | ||
Finance lease | 106,000 | 2,412,000 | ||
Total notes payable | $ 160,000 | |||
Dominion Revolving Credit Facility | ||||
DEBT | ||||
Maturity of line of credit extended | 1 year | |||
Maximum borrowing capacity | $ 15,000,000 | |||
Percentage of maximum borrowing capacity on eligible accounts receivable | 80.00% | |||
Percentage of maximum borrowing capacity on deposit with lender | 100.00% | |||
Restricted CDARS account | $ 5,000,000 | |||
Commitment fee (as a percent) | 0.10% | |||
Minimum tangible net worth | $ 75,000,000 | |||
Dominion Revolving Credit Facility | Minimum | ||||
DEBT | ||||
Interest rate (as a percent) | 3.50% | |||
Dominion Revolving Credit Facility | Maximum | ||||
DEBT | ||||
Interest rate (as a percent) | 6.00% | |||
Veritex Letters of Credit | ||||
DEBT | ||||
Number of letters of credit | 2 | |||
First Veritex Letters of Credit | ||||
DEBT | ||||
Amount of letter of credit | $ 1,767,000 | |||
First Veritex Letters of Credit | Subsequent Events | ||||
DEBT | ||||
Letter of credit terminated | $ 1,767,000 | |||
Second Veritex Letters of Credit | ||||
DEBT | ||||
Amount of letter of credit | $ 583,000 | |||
Second Veritex Letters of Credit | Subsequent Events | ||||
DEBT | ||||
Letter of credit terminated | 583,000 | |||
Dominion Letters of Credit | ||||
DEBT | ||||
Amount of letter of credit | $ 583,000 | |||
Notes payable to finance companies for insurance | ||||
DEBT | ||||
Interest rate (as a percent) | 4.99% | |||
Number of notes payable | item | 1 | |||
Total notes payable | $ 160,000 | $ 1,746,000 | ||
Notes payable to finance companies for insurance | Minimum | ||||
DEBT | ||||
Interest rate (as a percent) | 4.05% | |||
Notes payable to finance companies for insurance | Maximum | ||||
DEBT | ||||
Interest rate (as a percent) | 4.99% |
DEBT - Aggregate principal amou
DEBT - Aggregate principal amount and interest rates (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
DEBT | ||
Aggregate principal amount outstanding | $ 160,000 | |
Notes payable to finance companies for insurance | ||
DEBT | ||
Aggregate principal amount outstanding | $ 160,000 | $ 1,746,000 |
Interest rate (as a percent) | 4.99% | |
Notes payable to finance companies for insurance | Minimum | ||
DEBT | ||
Interest rate (as a percent) | 4.05% | |
Notes payable to finance companies for insurance | Maximum | ||
DEBT | ||
Interest rate (as a percent) | 4.99% |
DEBT - Maturities (Details)
DEBT - Maturities (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Aggregate maturities of notes payable | ||
October 2020 - September 2021 | $ 160,000 | |
Total notes payable | 160,000 | |
Aggregate maturities of finance leases | ||
October 2020 - September 2021 | 55,000 | |
October 2021 - September 2022 | 41,000 | |
October 2022 - September 2023 | 10,000 | |
Total finance lease liabilities | $ 106,000 | $ 2,412,000 |
Minimum | ||
Aggregate maturities of finance leases | ||
Interest rate on leases | 4.83% | |
Maximum | ||
Aggregate maturities of finance leases | ||
Interest rate on leases | 5.37% |
LEASES - Components of Lease Co
LEASES - Components of Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
LEASES | ||||
Amortization of right-of-use assets | $ 333 | $ 359 | $ 1,033 | $ 1,062 |
Interest on lease liabilities | 6 | 41 | 45 | 144 |
Total finance lease cost | 339 | 400 | 1,078 | 1,206 |
Operating lease cost | 391 | 388 | 1,166 | 1,197 |
Total lease cost | $ 730 | $ 788 | $ 2,244 | $ 2,403 |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
LEASES | ||
Operating cash flows from operating leases | $ (1,183) | $ (1,115) |
Operating cash flows from finance leases | (49) | (148) |
Financing cash flows from finance leases | (2,291) | (2,126) |
Right-of-use assets obtained in exchange for operating leases | $ 63 | 8,226 |
Right-of-use assets obtained in exchange for finance leases | $ 121 |
LEASES - Supplemental Balance S
LEASES - Supplemental Balance Sheet Information (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Operating leases | ||
Operating lease right-of-use assets | $ 5,736,000 | $ 6,605,000 |
Operating lease liabilities - current | 1,097,000 | 1,200,000 |
Operating lease liabilities - long-term | 5,157,000 | 5,940,000 |
Total operating lease liabilities | 6,254,000 | 7,140,000 |
Finance leases | ||
Property and equipment, at cost | 8,663,000 | 8,663,000 |
Accumulated depreciation | (4,267,000) | (3,297,000) |
Property and equipment, net | 4,396,000 | 5,366,000 |
Finance lease liabilities - current | 55,000 | 2,316,000 |
Finance lease liabilities - long-term | 51,000 | 96,000 |
Total finance lease liabilities | $ 106,000 | $ 2,412,000 |
Weighted average remaining lease term: | ||
Operating leases | 5 years 9 months 18 days | 6 years 3 months 18 days |
Finance leases | 1 year 9 months 18 days | 9 months 18 days |
Weighted average discount rate: | ||
Operating leases | 5.04% | 5.04% |
Finance leases | 4.99% | 4.67% |
LEASES - Maturities of Lease Li
LEASES - Maturities of Lease Liabilities (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Operating Leases | ||
October 2020 - September 2021 | $ 1,386,000 | |
October 2021 - September 2022 | 1,234,000 | |
October 2022 - September 2023 | 1,157,000 | |
October 2023 - September 2024 | 1,180,000 | |
October 2024 - September 2025 | 941,000 | |
Thereafter | 1,343,000 | |
Total payments under lease agreements | 7,241,000 | |
Less imputed interest | (987,000) | |
Total lease liabilities | 6,254,000 | $ 7,140,000 |
Finance Leases | ||
October 2020 - September 2021 | 60,000 | |
October 2021 - September 2022 | 42,000 | |
October 2022 - September 2023 | 10,000 | |
Total payments under lease agreements | 112,000 | |
Less imputed interest | (6,000) | |
Total lease liabilities | $ 106,000 | $ 2,412,000 |
OPERATING COMMITMENTS AND CON_2
OPERATING COMMITMENTS AND CONTINGENCIES (Details) | Apr. 01, 2019defendant |
Weatherford Litigation | |
OPERATING COMMITMENTS AND CONTINGENCIES | |
Number of other parties named as defendants | 18 |
NET (LOSS) INCOME PER SHARE (De
NET (LOSS) INCOME PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Net (loss) income | $ (7,840) | $ 1,500 | $ 993 | $ 1,998 | $ (11,246) | $ (137) | $ (5,347) | $ (9,385) |
Weighted average common shares outstanding: | ||||||||
Basic | 23,423,437 | 23,222,045 | 23,350,204 | 23,152,776 | ||||
Dilutive common stock options, restricted stock unit awards and restricted stock awards | 115,858 | |||||||
Diluted | 23,423,437 | 23,337,903 | 23,350,204 | 23,152,776 | ||||
Basic (loss) income per share of common stock | $ (0.33) | $ 0.09 | $ (0.23) | $ (0.41) | ||||
Diluted (loss) income per share of common stock | $ (0.33) | $ 0.09 | $ (0.23) | $ (0.41) | ||||
Restricted stock units | ||||||||
Weighted average common shares outstanding: | ||||||||
Dilutive common stock options, restricted stock unit awards and restricted stock awards | 115,858 | |||||||
Stock options | ||||||||
Weighted average common shares outstanding: | ||||||||
Dilutive common stock options, restricted stock unit awards and restricted stock awards | 0 | |||||||
Restricted stock awards | ||||||||
Weighted average common shares outstanding: | ||||||||
Dilutive common stock options, restricted stock unit awards and restricted stock awards | 0 |
NET (LOSS) INCOME PER SHARE - A
NET (LOSS) INCOME PER SHARE - Anti-Dilutive Awards Excluded from Calculation (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Anti-dilutive Securities Excluded from Calculation of Earnings Per Share | ||||
Weighted average number of securities excluded from calculation | 242,478 | 222,000 | 332,868 | 550,123 |
Stock options | ||||
Anti-dilutive Securities Excluded from Calculation of Earnings Per Share | ||||
Weighted average number of securities excluded from calculation | 67,625 | |||
Restricted stock units | ||||
Anti-dilutive Securities Excluded from Calculation of Earnings Per Share | ||||
Weighted average number of securities excluded from calculation | 242,478 | 222,000 | 332,868 | 471,624 |
Restricted stock awards | ||||
Anti-dilutive Securities Excluded from Calculation of Earnings Per Share | ||||
Weighted average number of securities excluded from calculation | 10,874 |
INCOME TAXES (Details)
INCOME TAXES (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
INCOME TAXES | ||||
Effective tax rate (as percent) | (0.20%) | (1.30%) | (0.30%) | 1.50% |