Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | May 31, 2020 | Jun. 30, 2019 | |
Cover [Abstract] | |||
Entity Registrant Name | GSE SYSTEMS INC | ||
Entity Central Index Key | 0000944480 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Shell Company | false | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Public Float | $ 47,033,354 | ||
Entity Common Stock, Shares Outstanding | 20,389,082 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Address, State or Province | DE |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 11,691 | $ 12,123 |
Contract receivables, net | 17,207 | 21,077 |
Prepaid expenses and other current assets | 1,880 | 1,800 |
Total current assets | 30,778 | 35,000 |
Equipment, software, and leasehold improvements | 5,523 | 5,293 |
Accumulated depreciation | (4,584) | (4,228) |
Equipment, software, and leasehold improvements, net | 939 | 1,065 |
Software development costs, net | 641 | 615 |
Goodwill | 13,339 | 13,170 |
Intangible assets, net | 10,479 | 6,080 |
Deferred tax assets | 57 | 5,461 |
Operating lease - right of use assets, net | 2,215 | 0 |
Other assets | 61 | 49 |
Total assets | 58,509 | 61,440 |
Current liabilities | ||
Current portion of long-term debt, net of debt issuance costs and original issue discount | 18,481 | 1,902 |
Accounts payable | 1,097 | 1,307 |
Accrued expenses | 1,871 | 2,646 |
Accrued compensation | 1,876 | 3,649 |
Billings in excess of revenue earned | 7,613 | 10,609 |
Accrued warranty | 921 | 981 |
Income taxes payable | 1,341 | 1,176 |
Other current liabilities | 1,234 | 60 |
Total current liabilities | 34,434 | 22,330 |
Long-term debt, less current portion, net of debt issuance costs and original issue discount | 0 | 6,610 |
Operating lease liabilities | 3,000 | 0 |
Other liabilities | 956 | 1,371 |
Total liabilities | 38,390 | 30,311 |
Commitments and contingencies | ||
Stockholder's equity | ||
Preferred stock $0.01 par value, 2,000,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock $0.01 par value; 60,000,000 shares authorized, 21,838,963 shares issued, 20,240,052 shares outstanding as of December 31, 2019; 60,000,000 shares authorized, 21,485,445 shares issued, 19,886,534 shares outstanding as of December 31, 2018 | 218 | 214 |
Additional paid-in capital | 79,400 | 78,118 |
Accumulated deficit | (54,654) | (42,569) |
Accumulated other comprehensive loss | (1,846) | (1,635) |
Treasury stock at cost, 1,598,911 shares | (2,999) | (2,999) |
Total stockholders' equity | 20,119 | 31,129 |
Total liabilities and stockholders' equity | $ 58,509 | $ 61,440 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Stockholder's equity | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 60,000,000 | 60,000,000 |
Common stock, shares issued (in shares) | 21,838,963 | 21,485,445 |
Common stock, shares outstanding (in shares) | 20,240,052 | 19,886,534 |
Treasury stock at cost (in shares) | 1,598,911 | 1,598,911 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ||
Revenue | $ 82,975 | $ 92,249 |
Cost of revenue | 62,677 | 69,119 |
Gross profit | 20,298 | 23,130 |
Operating expenses | ||
Selling, general and administrative | 16,169 | 17,469 |
Research and development | 710 | 899 |
Restructuring charges | 2,478 | 1,269 |
Loss on impairment | 5,597 | 0 |
Depreciation | 363 | 515 |
Amortization of definite-lived intangible assets | 2,400 | 1,612 |
Total operating expenses | 27,717 | 21,764 |
Operating (loss) income | (7,419) | 1,366 |
Interest expense | (988) | (268) |
Loss on derivative instruments | (13) | (350) |
Other income (expense), net | 2,068 | 29 |
Income (loss) before income taxes | (6,352) | 777 |
Provision (benefit) for income taxes | 5,733 | 1,131 |
Net loss | $ (12,085) | $ (354) |
Basic loss per common share (in dollars per share) | $ (0.60) | $ (0.02) |
Diluted loss per common share (in dollars per share) | $ (0.60) | $ (0.02) |
Weighted average shares outstanding - Basic (in shares) | 20,062,021 | 19,704,999 |
Weighted average shares outstanding - Diluted (in shares) | 20,062,021 | 19,704,999 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS [Abstract] | ||
Net loss | $ (12,085) | $ (354) |
Foreign currency translation adjustment | (211) | (164) |
Comprehensive loss | $ (12,296) | $ (518) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Treasury Stock [Member] | Total |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Cumulative effect of new accounting principle | ASU 606 [Member] | $ 0 | $ 0 | $ 655 | $ 0 | $ 0 | $ 655 |
Balance at Dec. 31, 2017 | $ 210 | 76,802 | (42,870) | (1,471) | $ (2,999) | 29,672 |
Balance (in shares) at Dec. 31, 2017 | 21,024,395 | (1,598,911) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation expense | $ 0 | 1,668 | 0 | 0 | $ 0 | 1,668 |
Common stock issued for options exercised (in shares) | 219,997 | |||||
Common stock issued for options exercised | $ 2 | 134 | 0 | 0 | 0 | 136 |
Common stock issued for RSUs vested (in shares) | 241,053 | |||||
Common stock issued for RSUs vested | $ 2 | (2) | 0 | 0 | 0 | 0 |
Shares withheld to pay taxes | (484) | (484) | ||||
Foreign currency translation adjustment | 0 | 0 | 0 | (164) | 0 | (164) |
Net loss | 0 | 0 | (354) | 0 | 0 | (354) |
Balance at Dec. 31, 2018 | $ 214 | 78,118 | (42,569) | (1,635) | $ (2,999) | 31,129 |
Balance (in shares) at Dec. 31, 2018 | 21,485,445 | (1,598,911) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation expense | $ 0 | 1,513 | 0 | 0 | $ 0 | 1,513 |
Common stock issued for options exercised (in shares) | 9,011 | |||||
Common stock issued for options exercised | $ 1 | 0 | 0 | 0 | 0 | 1 |
Common stock issued for RSUs vested (in shares) | 344,507 | |||||
Common stock issued for RSUs vested | $ 3 | (3) | 0 | 0 | 0 | 0 |
Shares withheld to pay taxes | 0 | (228) | 0 | 0 | 0 | (228) |
Foreign currency translation adjustment | 0 | 0 | 0 | (211) | 0 | (211) |
Net loss | 0 | 0 | (12,085) | 0 | 0 | (12,085) |
Balance at Dec. 31, 2019 | $ 218 | $ 79,400 | $ (54,654) | $ (1,846) | $ (2,999) | $ 20,119 |
Balance (in shares) at Dec. 31, 2019 | 21,838,963 | (1,598,911) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows provided by operating activities | ||
Net loss | $ (12,085) | $ (354) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Write-off of long-lived assets to be disposed of | 5,597 | 0 |
Depreciation | 363 | 515 |
Amortization of definite-lived intangible assets | 2,400 | 1,612 |
Amortization of capitalized software development costs | 366 | 507 |
Change in fair value of contingent consideration | (1,200) | 0 |
Stock-based compensation expense | 1,420 | 1,526 |
Bad debt expense | 31 | 294 |
Loss on derivative instruments, net | 13 | 350 |
Deferred income taxes | 5,349 | 644 |
(Gain) on sale of equipment, software, and leasehold improvements | (66) | 0 |
Changes in assets and liabilities | ||
Contract receivables, net | 6,754 | (5,656) |
Prepaid expenses and other assets | 532 | 856 |
Accounts payable, accrued compensation, and accrued expenses | (3,458) | (838) |
Billings in excess of revenue earned | (3,051) | (2,984) |
Accrued warranty | (294) | (322) |
Other liabilities | 1,333 | 367 |
Net cash provided by (used in) operating activities | 4,004 | (3,483) |
Cash flows from investing activities: | ||
Purchase of equipment, software and leasehold improvements | (131) | (513) |
Proceeds from sale of assets | 13 | 0 |
Capitalized software development costs | (392) | (432) |
Acquisition of True North Consulting, net of cash acquired | 0 | (9,609) |
Acquisition of DP Engineering, net of cash acquired | (13,542) | 0 |
Net cash used in investing activities | (14,052) | (10,554) |
Cash flows from financing activities: | ||
Proceeds from issuance of long-term debt | 14,263 | 10,154 |
Repayment of long-term debt | (4,294) | (1,642) |
Proceeds from issuance of common stock | 1 | 136 |
Shares withheld to pay taxes on stock based compensation | (228) | (484) |
Contingent consideration payments to former owners of Hyperspring, LLC | 0 | (1,701) |
Net cash provided by financing activities | 9,742 | 6,463 |
Effect of exchange rate changes on cash | (126) | (374) |
Net decrease in cash, cash equivalents, and restricted cash | (432) | (7,948) |
Cash, cash equivalents, and restricted cash, beginning balance | 12,123 | 20,071 |
Cash, cash equivalents, and restricted cash, ending balance | $ 11,691 | $ 12,123 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies Principles of consolidation GSE Systems, Inc. is a leading provider of professional and technical engineering, staffing services, and simulation software to clients in the power and process industries. References in this report to “GSE,” the “Company,” “we” and “our” are to GSE Systems and its subsidiaries, collectively. All intercompany balances and transactions have been eliminated in consolidation. Accounting estimates The preparation of the consolidated financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. On an ongoing basis, the Company evaluates the estimates used, including, but not limited to those related to revenue recognition on long-term contracts, allowance for doubtful accounts, product warranties, valuation of goodwill and intangible assets acquired, impairment of long-lived assets, valuation of contingent consideration issued in business acquisitions, valuation of stock based compensation awards and the recoverability of deferred tax assets. Actual results could differ from these estimates. Business combinations Business combinations are accounted for in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), ASC 805, Business Combinations, Revenues and the results of operations of the acquired business are included in the accompanying consolidated statements of operations commencing on the date of acquisition. Acquisitions may include contingent consideration payments based on future financial measures of an acquired company. Under ASC 805, contingent consideration is required to be recognized at fair value as of the acquisition date. We estimate the fair value of these liabilities based on financial projections of the acquired companies and estimated probabilities of achievement. At each reporting date, the contingent consideration obligation is revalued to estimated fair value, and changes in fair value subsequent to the acquisition are reflected in income or expense in the consolidated statements of operations, and could cause a material impact to our operating results. Changes in the fair value of contingent consideration obligations may result from changes in discount periods and rates, changes in the timing and amount of revenue and/or earnings estimates, and changes in probability assumptions with respect to the likelihood of achieving the various earn-out criteria. Revenue recognition The Company derives its revenue through three broad revenue streams: 1) System Design and Build (SDB), 2) Software, and 3) Training and Consulting services. We recognize revenue from SDB and software contracts mainly through the Performance Improvement Solutions segment and the training and consulting service contracts through both the Performance Improvement Solutions segment and Nuclear Industry Training and Consulting segment. The SDB contracts are typically fixed-price and consist of initial design, engineering, assembly and installation of training simulators which include hardware, software, labor, and post contract support (PCS) on the software. We generally have two main performance obligations for an SDB contract: the training simulator build and PCS. The training simulator build performance obligation generally includes hardware, software, and labor. The transaction price under the SDB contracts is allocated to each performance obligation based on its standalone selling price. We recognize the training simulator build revenue over the construction and installation period using the cost-to-cost input method as our performance creates or enhances assets with no alternative use to the Company, and we have an enforceable right to payment for performance completed to date. Cost-to-cost input method best measures the progress toward complete satisfaction of the performance obligation. PCS revenue is recognized ratably over the service period, as PCS is deemed a stand-ready obligation. In applying the cost-to-cost input method, we use the actual costs incurred to date relative to the total estimated costs to measure the work progress toward the completion of the performance obligation and recognize revenue accordingly. Estimated contract costs are reviewed and revised periodically as the work progresses, and the cumulative effect of any change in estimates is recognized in the period in which the change is identified. Estimated losses are recognized in the period such losses are identified. Uncertainties inherent in the performance of contracts include labor availability and productivity, material costs, change order scope and pricing, software modification and customer acceptance issues. The reliability of these cost estimates is critical to the Company’s revenue recognition as a significant change in the estimates can cause the Company’s revenue and related margins to change significantly from the amounts estimated in the early stages of the project. The SDB contracts generally on the systems. The base warranty will not be accounted for as a separate performance obligation under the contract because it does not provide the customer with a service in addition to the assurance evaluated on a case by case basis to determine if it provides more than just assurance that the product operates as intended, which requires carve-out as a separate performance obligation. Revenue from the sale of perpetual standalone and term software licenses, which do not require significant modification or customization, is recognized upon its delivery to the customer. Revenue from the sale of cloud based subscription applications is recognized ratably over the subscription period following delivery to the customer. Delivery is considered to have occurred when the customer receives access to the software or the cloud based application. A software license sale contract with multiple deliverables typically includes the following elements: license, installation and training services, and PCS. The total transaction price of a software license sale contract is typically fixed, and is allocated to the identified performance obligations based on their relative standalone selling prices. Revenue is recognized as the performance obligations are satisfied. Specifically, license revenue is recognized when the software license is delivered to the customer; installation and training revenue is recognized when the installation and training is completed without regard to a detailed evaluation of the point in time criteria due to the short-term nature of the installation and training services (one to two days on average); and PCS revenue is recognized ratably over the service period, as PCS is deemed as a stand-ready obligation. The contracts within the training and consulting services revenue stream are either time and materials (T&M) based or fixed-price based. Under a typical T&M contract, the Company is compensated based on the number of hours of approved time provided by temporary workers and the bill rates which are fixed by type of work, as well as approved expenses incurred. The customers are billed on a regular basis, such as weekly, biweekly or monthly. In accordance with ASC 606-10-55-18, Revenue from contracts with customers For contracts with multiple performance obligations, we allocate the contract price to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the prices charged to customers. Cash and cash equivalents Cash and cash equivalents represent cash and highly liquid investments including money market accounts with maturities of three months or less at the date of purchase. Contract receivables, net Contract receivables include recoverable costs and accrued profit not billed which represents revenue recognized in excess of amounts billed. Billings in excess of costs and estimated earnings on uncompleted contracts in the accompanying consolidated balance sheets represent advanced billings to clients on contracts in advance of work performed. Generally, such amounts will be earned and recognized over the next twelve months. Billed receivables are recorded at invoiced amounts. The allowance for doubtful accounts is based on historical trends of past due accounts, write-offs, specific identification and review of customer accounts. Impairment of long-lived assets Long-lived assets, such as equipment, purchased software, capitalized software development costs, and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized at the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of would be separately presented in the consolidated balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated. Development expenditures Development expenditures incurred to meet customer specifications under contracts are charged to contract costs. Company sponsored development expenditures are either charged to operations as incurred and are included in research and development expenses or are capitalized as software development costs. The amounts incurred for Company sponsored development activities relating to the development of new products and services or the improvement of existing products and services, were approximately $1.1 million and $1.3 million for the years ended December 31, 2019 and 2018, respectively. Of this amount, the Company capitalized approximately $0.4 million for the years ended December 31, 2019 and 2018. Equipment, software and leasehold improvements, net Equipment and purchased software are recorded at cost and depreciated using the straight-line method with estimated useful lives ranging from three years to ten years. Leasehold improvements are amortized over the life of the lease or the estimated useful life, whichever is shorter, using the straight-line method. Upon sale or retirement, the cost and related depreciation are eliminated from the respective accounts and any resulting gain or loss is included in operations. Maintenance and repairs are charged to expense as incurred. Software development costs Certain computer software development costs, including direct labor cost, are capitalized in the accompanying consolidated balance sheets. Capitalization of computer software development costs begins upon the establishment of technological feasibility. Capitalization ceases and amortization of capitalized costs begins when the software product is commercially available for general release to customers. Amortization of capitalized computer software development costs is included in cost of revenue and is determined using the straight-line method over the remaining estimated economic life of the product, typically three years. On an annual basis, or more frequently as conditions indicate, the Company assesses the recovery of the unamortized software development costs by estimating the net undiscounted cash flows expected to be generated by the sale of the product. If the undiscounted cash flows are not sufficient to recover the unamortized software costs the Company will write-down the carrying amount of such asset to its estimated fair value based on the future discounted cash flows. The excess of any unamortized computer software costs over the related fair value is written down and charged to operations. Goodwill and intangible assets The Company’s intangible assets include amounts recognized in connection with business acquisitions, including customer relationships, trade names, non-compete agreements and alliance agreements. Intangible assets are initially valued at fair value using generally accepted valuation methods appropriate for the type of intangible asset. Amortization is recognized on a straight-line basis over the estimated useful life of the intangible assets, except for contract backlog and contractual customer relations, which are recognized in proportion to the related project revenue streams. Intangible assets with definite lives are reviewed for impairment if indicators of impairment arise. The Company does not have any intangible assets with indefinite useful lives. Goodwill represents the excess of costs over fair value of assets of businesses acquired. The Company reviews goodwill for impairment annually as of December 31 and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable in accordance with Accounting Standards Update (“ASU”) 2011-08, Intangibles - Goodwill and Other (Topic 350): Testing Goodwill for Impairment ASU 2011-08 permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. Under ASU 2011-08, an entity is not required to perform step one of the goodwill impairment test for a reporting unit if it is more likely than not that its fair value is greater than its carrying amount. On February 15, 2019, we acquired DP Engineering (as described in Note 4) and preliminarily recorded goodwill and identified intangible assets as part of the acquisition. On February 23, 2019, an unexpected event occurred at one of DP Engineering’s significant customers and all pending work for that customer was suspended pending a root cause analysis on February 28, 2019. On May 10, 2019, the Company determined that a material impairment had occurred, requiring an assessment for impairment to be completed related to $5.8 million of goodwill recorded in the acquisition. See Note 7. For the annual goodwill impairment test as of December 31, 2019, the Company performed a quantitative step 1 goodwill impairment analysis and have concluded that the estimated fair values of each of the reporting units exceeded their respective carrying values. No further goodwill impairment was recorded during 2019. At December 31, 2018 Foreign currency translation The United States Dollar (“USD”) is the functional currency of GSE and our subsidiaries operating in the United States. Our subsidiaries’ financial statements are maintained in their functional currencies. The functional currency of each of our foreign subsidiaries is the currency of the economic environment in which the subsidiary primarily does business. Our foreign subsidiaries’ financial statements are translated into USD using the exchange rates applicable to the dates of the financial statements. Assets and liabilities are translated into USD using the period-end spot foreign exchange rates. Income and expenses are translated at the average exchange rate for the year. Equity accounts are translated at historical exchange rates. The effects of these translation adjustments are cumulative translation adjustments, which are reported as a component of accumulated other comprehensive income (loss) included in the consolidated statements of changes in stockholders’ equity. For any business transaction that is in a currency different from the entity’s functional currency, we record a gain or loss based on the difference between the exchange rate at the transaction date and the exchange rate at the transaction settlement date (or rate at period end, if unsettled) to foreign currency realized gain (loss) account, net gain (loss) on derivative instruments in the consolidated statements of operations. Income taxes Income taxes are provided under the asset and liability method. Under this method, deferred income taxes are determined based on the differences between the consolidated financial statements and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized. A provision is made for the Company’s current liability for federal, state and foreign income taxes and the change in the Company’s deferred income tax assets and liabilities. We establish accruals for uncertain tax positions taken or expected to be taken in a tax return when it is not more likely than not (i.e., a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities that have full knowledge of all relevant information. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. Favorable or unfavorable adjustment of the accrual for any particular issue would be recognized as an increase or decrease to income tax expense in the period of a change in facts and circumstances. Interest and penalties related to income taxes are accounted for as income tax expense. Stock-based compensation Share-based compensation expense is based on the grant-date fair value estimated in accordance with the provisions of ASC 718, Compensation-Stock Compensation Significant customers and concentration of credit risk For the year ended December 31, 2019, we have a concentration of revenue from one individual customer, which accounted for 27.8% of our consolidated revenue. For the year ended December 31, 2018, we have a concentration of revenue from two customers, which accounted for 14.3% and 26.9% of our consolidated revenue, respectively. These customers are part of both Performance and NITC segments. No other individual customer accounted for more than 10% of our consolidated revenue in 2019 or 2018. As of December 31, 2019, we have two customers that accounted for 10.3% and 12.6% of the Company’s consolidated contract receivables. As of December 31, 2018, the Company had one customer that accounted for 16.8% of the Company’s consolidated contract receivables. No other individual customer accounted for more than 10% of our consolidated revenue in 2019 or 2018. Fair values of financial instruments The carrying amounts of current assets and current liabilities reported in the consolidated balance sheets approximate fair value due to their short term duration. Derivative instruments The Company utilizes forward foreign currency exchange contracts to manage market risks associated with the fluctuations in foreign currency exchange rates. It is the Company’s policy to use such derivative financial instruments to protect against market risk arising in the normal course of business in order to reduce the impact of these exposures. The Company minimizes credit exposure by limiting counterparties to nationally recognized financial institutions. Earnings per share Basic loss per share is computed by dividing our net loss available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share is computed by dividing our net loss available to common shareholders by the diluted weighted average number of shares of common stock during the period. Since we experienced a net loss for all periods presented, basic and diluted net loss per share are the same. As such, diluted loss per share for the years ended December 31, 2019 and 2018 excludes the impact of potentially dilutive common shares since those shares would have an anti-dilutive effect on loss per share. The number of common shares and common share equivalents used in the determination of basic and diluted (loss) earnings per share were as follows: (in thousands, except for per share data) Years ended December 31, 2019 2018 Numerator: Net (loss) income attributed to common stockholders $ (12,085 ) $ (354 ) Denominator: Weighted-average shares outstanding for basic earnings per share 20,062,021 19,704,999 Effect of dilutive securities: Employee stock options and warrants - - Adjusted weighted-average shares outstanding and assumed conversions for diluted earnings per share 20,062,021 19,704,999 Shares related to dilutive securities excluded because inclusion would be anti-dilutive 314,234 217,152 Conversion of certain outstanding stock options was not assumed for the years ended December 31, 2019 and 2018 because the impact would have been anti-dilutive. Going Concern Consideration We are in compliance with the amended financial covenants contained in our debt agreement with Citizen’s Bank at December 31, 2019 and in April 2020 entered into an amendment, which removes certain covenants through March 31, 2021. We are experiencing, as a result of the COVID-19 pandemic a negative impact on our financial position and results of operations. We have, and are likely to continue to experience loss or delayed orders, disruption of business as a result of worker illness or mandated shutdowns, and this could impact our ability to maintain compliance with loan covenants, our ability to refinance existing indebtedness, and access to new capital. As part of our certification for the Paycheck Protection Program ("PPP") we indicated without these funds, the risk of employee terminations, layoffs and other drastic cost reductions exists. While the PPP funds will provide sufficient liquidity for the Company these funds will not prevent us from potentially not meeting the minimum EBITDA covenants and potentially not meeting the leverage ratio covenants in the future. Including the proceeds from our PPP loan, we believe we have sufficient cash to meet our operating requirement needs for at least the next twelve months, however since some of our loan covenants are related to operating performance, and our operating performance is being significantly impacted by COVID-19 we believe it is probable we will not meet our debt covenants requirement during all of 2020. If our debt becomes due and payable as a result of a covenant violation, it calls into question our ability to continue as a going concern. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2019 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | 2. Recent Accounting Pronouncements Accounting pronouncements recently adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02, Leases (Topic 842), The Company adopted the new standard using the modified retrospective approach effective on January 1, 2019. The Company’s adoption included lease codification improvements that were issued by the FASB through June 2019. The FASB made available several practical expedients in adopting the new lease accounting guidance. The Company elected the package of practical expedients permitted under the transition guidance within the amended guidance, which among other things, allowed registrants to carry forward historical lease classification. The Company elected the practical expedient that allows the combination of both lease and non-lease components as a single component and account for it as a lease for all classes of underlying assets. The Company elected not to apply the new guidance to short term leases with an initial term of twelve months or less. The Company recognizes those lease payments in the consolidated statements of operations on a straight-line basis over the lease term. The Company elected to use a single discount rate for a portfolio of leases with reasonably similar characteristics. The most significant impact was the recognition of ROU assets and related lease liabilities for operating leases on the consolidated balance sheets. The Company recognized ROU assets and related lease liabilities of $2.7 million and $3.0 million respectively, related to operating lease commitments, as of January 1, 2019. The operating lease ROU asset represents the lease liability, plus any lease payments made at or before the commencement date, less any lease incentives received. The new guidance did not have a material impact on the Company’s cash flows or results of operations. See Note 18 of the consolidated financial statements. Accounting pronouncements not yet adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment |
Revision and Immaterial Correct
Revision and Immaterial Correction of an Error in Previously Issued Financial Statements | 12 Months Ended |
Dec. 31, 2019 | |
Revision and Immaterial Correction of an Error in Previously Issued Financial Statements [Abstract] | |
Revision and Immaterial Correction of an Error in Previously Issued Financial Statements | 3. Revision and Immaterial Correction of an Error in Previously Issued Financial Statements During the quarter ended December 31, 2019, we identified errors related to the impairment of intangibles we acquired as part of our acquisition of DP Engineering. In our March 31, 2019 interim unaudited financial statements we recorded an impairment charge to both our definite-lived intangible assets (customer relationships) of $3.4 million and goodwill of $2.2 million. Subsequently, we concluded no impairment of the definite-lived intangibles was necessary and the entire impairment amount should have been allocated to goodwill. The revision had no overall impact on the amount of the total impairment but did impact the allocation of impairment between definite-lived intangibles and goodwill. This revision results in additional amortization of the definite-lived intangible asset. In accordance with ASC 250, Accounting Changes and Error Corrections The tables below present the effect of the financial statement adjustments related to the revision discussed above of the Company’s previously reported financial statements as of and for the periods ended March 31, June 30, and September 30, 2019. The cumulative tax effect of the revision is reflected in the twelve months ended December 31, 2019 financial statements. This misstatement had no net impact on the Company’s consolidated statements of cash flows. The effect of the immaterial correction of an error on our previously filed unaudited consolidated financial statements as of and for the three months ended March 31, 2019 is as follows: Consolidated balance sheets (in thousands) Three months ended March 31, 2019 As reported Adjustment As revised Goodwill $ 16,709 $ (3,370 ) $ 13,339 Intangible assets, net 8,999 3,309 12,308 Total assets $ 71,424 $ (61 ) $ 71,363 Accumulated deficit (46,805 ) (61 ) (46,866 ) Total liabilities and stockholders' equity $ 71,424 $ (61 ) $ 71,363 Consolidated statement of operations Three months ended March 31, 2019 As reported Adjustment As revised Amortization of definite-lived intangible assets $ 509 $ 61 $ 570 Loss before income taxes (6,084 ) (61 ) (6,145 ) Net loss $ (4,236 ) $ (61 ) $ (4,297 ) Basic loss per common share $ (0.21 ) $ (0.01 ) $ (0.22 ) Diluted loss per common share $ (0.21 ) $ (0.01 ) $ (0.22 ) Consolidated statement of stockholders' equity Three months ended March 31, 2019 As reported Adjustment As revised Net loss $ (4,236 ) $ (61 ) $ (4,297 ) The effect of the immaterial correction of an error on our previously filed unaudited consolidated financial statements as of and for the six months ended June 30, 2019 is as follows: Consolidated balance sheets (in thousands) Six months ended June 30, 2019 As reported Adjustment As revised Goodwill $ 16,709 $ (3,370 ) $ 13,339 Intangible assets, net 8,454 3,218 11,672 Total assets $ 68,996 $ (152 ) $ 68,844 Accumulated deficit $ (46,930 ) $ (152 ) $ (47,082 ) Total liabilities and stockholders' equity $ 68,996 $ (152 ) $ 68,844 Consolidated statement of operations Six months ended June 30, 2019 As reported Adjustment As revised Amortization of definite-lived intangible assets $ 1,056 $ 152 $ 1,208 Loss before income taxes (5,803 ) (152 ) (5,955 ) Net loss $ (4,361 ) $ (152 ) $ (4,513 ) Basic loss per common share $ (0.22 ) $ (0.01 ) $ (0.23 ) Diluted loss per common share $ (0.22 ) $ (0.01 ) $ (0.23 ) Consolidated statement of stockholders’ equity Six months ended June 30, 2019 As reported Adjustment As revised Net loss $ (4,361 ) $ (152 ) $ (4,513 ) The effect of the immaterial correction of an error on our previously filed unaudited consolidated financial statements as of and for the nine months ended September 30, 2019 is as follows: Consolidated balance sheets (in thousands) Nine months ended September 30, 2019 As reported Adjustment As revised Goodwill $ 16,709 $ (3,370 ) $ 13,339 Intangible assets, net 7,960 3,116 11,076 Total assets $ 63,859 $ (254 ) $ 63,605 Accumulated deficit $ (48,050 ) $ (254 ) $ (48,304 ) Total liabilities and stockholders' equity $ 63,859 $ (254 ) $ 63,605 Consolidated statement of operations Nine months ended September 30, 2019 As reported Adjustment As revised Amortization of definite-lived intangible assets $ 1,550 $ 254 $ 1,804 Loss before income taxes (6,356 ) (254 ) (6,610 ) Net loss $ (5,482 ) $ (254 ) $ (5,736 ) Basic loss per common share $ (0.27 ) $ (0.01 ) $ (0.28 ) Diluted loss per common share $ (0.27 ) $ (0.01 ) $ (0.28 ) Consolidated statement of stockholders' equity Nine months ended September 30, 2019 As reported Adjustment As revised Net loss $ (5,482 ) $ (254 ) $ (5,736 ) |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions [Abstract] | |
Acquisitions | 4. Acquisitions DP Engineering On February 15, 2019, the Company through its wholly-owned subsidiary GSE Performance Solutions, Inc. (Performance Solutions), entered into a membership interest purchase agreement (the “DP Engineering Purchase Agreement”) with Steven L. Pellerin, Christopher A. Davenport, and DP Engineering to purchase 100% of the membership interests in DP Engineering for $13.5 million. The acquisition of DP Engineering was completed on an all-cash transaction basis. The acquisition was completed through the draw down of $14.3 million (including transaction costs) of the term loan. During the transaction, GSE incurred and paid $0.7 million of transaction cost. The purchase price was subject to customary pre- and post-closing working capital adjustments, plus an additional earn-out amount not to exceed $5 million, potentially payable in 2020 and 2021 depending on DP Engineering’s satisfaction of certain targets for Adjusted EBITDA in calendar years 2019 and 2020, respectively. An escrow of approximately $1.7 million was funded at the closing and was released in full to the Company in December 2019 as part of a negotiated settlement of certain Company claims for indemnification pursuant to the DP Engineering Purchase Agreement. DP Engineering is a provider of value-added technical engineering solutions and consulting services to nuclear power plants with an emphasis on preparation and implementation of design modifications during plant outages. Located in Fort Worth, Texas, DP Engineering is well-regarded as a leading service provider to the nuclear power industry, having been designated an “engineer of choice” by several of the largest power generation companies. Based on preliminary forecasted adjusted EBITDA of DP Engineering for the years 2019 and 2020, as of the acquisition date, the estimated fair value of the total earn-out amount was $1.2 million and was recorded as contingent consideration. Subsequent to the acquisition, it was determined that the conditions related to the contingent consideration would not be met and hence $1.2 million was recorded to income in the first quarter of 2019. The following table summarizes the calculation of adjusted purchase price as of the acquisition date (in thousands): Base purchase price per agreement $ 13,500 Pre closing working capital adjustment 155 Fair value of contingent consideration 1,200 Total purchase price $ 14,855 The following table summarizes the consideration paid to acquire DP Engineering and the fair value of the assets acquired and liabilities assumed at the date of the transaction. The following amounts except for cash are all reflected in the consolidated statement of cash flows within the “Acquisition of DP Engineering, net of cash acquired” line caption. ( in thousands Total purchase price $ 14,855 Purchase price allocation: Cash 134 Contract receivables 2,934 Prepaid expenses and other current assets 209 Property, and equipment, net 98 Intangible assets 6,798 Other assets 1,806 Accounts payable and accrued expenses (1,396 ) Other liabilities (1,494 ) Total identifiable net assets 9,089 Goodwill 5,766 Net assets acquired $ 14,855 The fair value of the assets acquired includes gross trade receivables of $2.9 million, of which the Company has collected in full. GSE did not acquire any other class of receivable as a result of the acquisition of DP Engineering. The goodwill is primarily attributable to value-added technical engineering solutions and consulting services to nuclear power plants with an emphasis on preparation and implementation of design modification during plant outages, the workforce of the acquired business and the significant synergies expected to arise after the acquisition of DP Engineering. The total amount of goodwill is expected to be tax deductible. All of the $5.8 million of goodwill was assigned to our Performance Improvement Solutions segment. Approximately one week following our acquisition of DP Engineering, an adverse event occurred at one of DP Engineering’s major customer’s location that affected plant operations. This incident adversely impacted the relationship between DP Engineering and its customer. The Company determined this represented a triggering event requiring an interim assessment for impairment. As a result of the impairment analysis, we recognized an impairment charge of $5.6 million on goodwill related to the acquisition of DP Engineering during the quarter ended March 31, 2019. On August 6, 2019, following the Notice of Suspension, the Company received a Notice of Termination from this customer, notifying the Company that they were terminating their Engineer of Choice consulting service agreement with DP Engineering. See Note 7 for further analysis on the carrying amount change due to impairment on goodwill and definite-lived intangible assets during the year ended December 31, 2019. As described in Note 3, a revision was made to prior periods regarding the impairment of DP Engineering. On August 27, 2019, the Company made a demand for indemnification pursuant to the DP Engineering Purchase Agreement and on December 30, 2019, the Company entered into a settlement agreement pursuant to which the sellers agreed to release the full escrow account balance to the Company and pay additional funds, in the total amount of $2.0 million. The Company received these funds on December 31, 2019. The following table summarizes the fair value of intangible assets acquired at the date of acquisition and the related weighted average amortization period: Intangible Assets Weighted average amortization period Fair Value (in years) (in thousands) Customer relationships 15 $ 4,898 Tradename 10 1,172 Non-compete agreements 5 728 Total $ 6,798 DP Engineering contributed revenue of $8.2 million to GSE for the period from February 15, 2019 to December 31, 2019. True North On May 11, 2018, GSE, through Performance Solutions, entered into a membership interest purchase agreement with Donald R. Horn, Jenny C. Horn, and True North Consulting LLC (the True North Purchase Agreement) to purchase 100% of the membership interests in True North Consulting LLC (True North) for $9.8 million. The purchase price was subject to customary pre- and post-closing working capital adjustments, resulting in total consideration of $9.9 million. The True North Purchase Agreement contains customary representations, warranties, covenants, and indemnification provisions subject to certain limitations. An escrow of $1.5 million was funded from the cash paid to the sellers True North is a provider of technical engineering solutions to nuclear and fossil fuel power plants with an emphasis on regulatory-driven ASME code programs. Located in Montrose, Colorado, True North is a well-regarded service provider to leading companies in the power industry. The acquisition of True North has broadened our engineering services offering, expanded our relationships with several of the largest nuclear energy providers in the United States, and has added a highly specialized, complementary talent pool to our employee base. The following table summarizes the consideration paid to acquire True North and the fair value of the assets acquired and liabilities assumed at the date of the transaction. As of December 31, 2019, the Company had finalized the determination of the fair value allocated to various assets and liabilities. ( in thousands Total purchase price $ 9,915 Purchase price allocation: Cash 306 Contract receivables 1,870 Prepaid expenses and other current assets 8 Property, and equipment, net 1 Intangible assets 5,088 Accounts payable, accrued expenses (1,744 ) Accrued compensation (353 ) Total identifiable net assets 5,176 Goodwill 4,739 Net assets acquired $ 9,915 The fair value of the assets acquired includes gross trade receivables of $1.9 million, of which the Company has collected in full. GSE did not acquire any other class of receivable as a result of the acquisition of True North. True North contributed revenue of $8.0 million to GSE for the period from May 11, 2018 to December 31, 2018. For the year ended December 31, 2019, True North contributed revenue of $9.8 million to GSE. The goodwill is primarily attributable to broader engineering service offering to new and existing customers, the workforce of the acquired business and the significant synergies expected to after since the acquisition of True North. The total amount of goodwill is expected to be tax deductible. All of the $4.7 million of goodwill was assigned to our Performance Improvement Solutions segment. The Company identified other intangible assets of $5.1 million, including customer contracts and relationships, tradename, non-compete agreements, and alliance agreements, with amortization periods of four years to fifteen years The following table summarizes the fair value of intangible assets acquired at the date of acquisition and the related weighted average amortization period: Intangible Assets Weighted Average Amortization Period Fair Value (in years) (in thousands) Customer relationships 15 $ 3,758 Tradename 10 582 Alliance agreements 5 527 Non-compete agreements 4 221 Total $ 5,088 Unaudited Pro Forma Financial Information The unaudited pro forma financial information in the table below summarizes the combined results of operations for GSE, True North and DP Engineering as if the business combinations had occurred on January 1, 2018, in thousands. Years ended December 31, 2019 2018 Revenue $ 85,959 $ 120,373 Net loss (4,805 ) (274 ) The pro forma financial information for all periods presented has been calculated after applying GSE's accounting policies and has also included pro forma adjustments resulting from these acquisitions, including amortization charges of the intangible assets identified from these acquisitions, interest expenses related to the financing transaction in connection with the acquisition of DP Engineering, and the related tax effects as if aforementioned companies were combined as of January 1, 2018. For the year ended December 31, 2019 the Company has incurred $0.7 million of selling, general and administrative costs related to the acquisition of DP Engineering. Due to a triggering event described in Note 7, an impairment test was conducted, which resulted in substantially writing down the estimated fair value of goodwill initially recognized upon the acquisition. These expenses are included in general and administrative expense on GSE's consolidated statements of operations and are reflected in pro forma loss for the year ended December 31, 2019, in the table above. For the year ended December 31, 2018 the Company incurred $0.5 million of selling, general and administrative costs related to the acquisition of True North. These expenses are included in general and administrative expense on GSE's consolidated statements of operations and are reflected in pro forma loss for the year ended December 31, 2018, in the table above. The pro forma financial information is not intended to reflect the actual results of operations that would have occurred if the acquisition had been completed on January 1, 2018, nor is it intended to be an indication of future operating results. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue [Abstract] | |
Revenue | 5. Revenue We account for revenue in accordance with ASC 606, Revenue from Contracts with Customers Revenue from Contracts with Customers We generate revenue primarily through three broad revenue streams: 1) SDB, 2) Software, and 3) Training and Consulting Services. We recognize revenue from SDB and software contracts mainly through the Performance Improvement Solutions segment and the training and consulting service contracts through both the Performance Improvement Solutions segment and Nuclear Industry Training and Consulting segment. The following table represents a disaggregation of revenue by type of goods or services for the years ended December 31, 2019 and 2018, along with the reportable segment for each category: ( in thousands Twelve Months Ended December 31, 2019 2018 Performance Improvement Solutions segment System Design and Build $ 19,574 $ 25,948 Software 2,883 2,883 Training and Consulting Services 23,320 14,123 Nuclear Industry Training and Consulting segment Training and Consulting Services 37,199 49,295 Total revenue $ 82,975 $ 92,249 SDB contracts are typically fixed-priced, and we receive payments based on a billing schedule as established in our contracts. The transaction price for software contracts is generally fixed. Fees for software are normally due in advance of or shortly after delivery of the software. Fees for PCS are normally paid in advance of the service period. For Training and Consulting Services, the customers are generally billed on a regular basis, such as weekly, biweekly or monthly, for services provided. Contract liability, which we classify as billing in excess of revenue earned, relates to payments received in advance of performance under the contract. Contract liabilities are recognized as revenue as performance obligations are satisfied. The following table reflects the balance of contract liabilities and the revenue recognized in the reporting period that was included in the contract liabilities from contracts with customers: ( in thousands December 31, 2019 December 31, 2018 Billings in excess of revenue earned (BIE) $ 7,613 $ 10,609 Revenue recognized in the period from amounts included in BIE at the beginning of the period $ 9,089 11,275 For an SDB contract, we generally have two main performance obligations: the training simulator build and PCS. The training simulator build generally includes hardware, software, and labor. We recognize the training simulator build revenue over the construction and installation period using the cost-to-cost input method. In applying the cost-to-cost input method, we use the actual costs incurred to date relative to the total estimated costs to measure the work progress toward the completion of the performance obligation and recognize revenue accordingly. Estimated contract costs are reviewed and revised periodically as the work progresses, and the cumulative effect of any change in estimates is recognized in the period in which the change is identified. Estimated losses are recognized in the period such losses are identified. Uncertainties inherent in the performance of contracts include labor availability and productivity, material costs, change order scope and pricing, software modification and customer acceptance issues. The reliability of these cost estimates is critical to the Company’s revenue recognition as a significant change in the estimates can cause the Company’s revenue and related margins to change significantly from the amounts estimated in the early stages of the project. For the year ended December 31, 2019, the Company recognized revenue of $2.5 million related to performance obligations satisfied in previous periods. As of December 31, 2019, the aggregate amount of transaction price allocated to the remaining performance obligations of SDB, software and fixed-price training and consulting services contracts is $28.0 million. The Company will recognize the revenue as the performance obligations are satisfied, which is expected to occur over the next twelve months. Part of the training and consulting services contracts are T&M based. Under a typical T&M contract, the Company is compensated based on the number of hours of approved time provided by temporary workers and the bill rates, which are fixed by type of work, as well as approved expenses incurred. As part of our adoption of ASU 2014-09, we have elected to use the optional exemption under ASC 606-10-50-14(b), pursuant to which we have excluded disclosures of transaction prices allocated to remaining performance obligations under such contracts and when we expect to recognize the revenue. |
Restructuring Expenses
Restructuring Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring Expenses [Abstract] | |
Restructuring Expenses | 6. Restructuring expenses I nternational Restructuring On December 27, 2017, the Board of the Company approved an international restructuring plan to streamline and optimize the Company’s global operations. Beginning in December 2017, GSE has been in the process of consolidating its engineering services and R&D activities to Maryland and ceasing an unprofitable non-core business in the United Kingdom (UK). As a result, the Company closed its offices in Nyköping, Sweden; Chennai, India; and Stockton-on-Tees, UK. These actions are designed to improve Company productivity by eliminating duplicate employee functions, increasing GSE’s focus on its core business, improving efficiency and maintaining the full range of engineering capabilities while reducing costs and organizational complexity. GSE eliminated approximately 40 positions due to these changes, primarily in Europe and India, and will undertake other cost-savings measures. As a result of these efforts, as shown in the table below, GSE expects to record a restructuring charge of approximately $2.2 million in total, primarily related to workforce reductions, contracts termination costs and asset write-offs due to the exit activities. We recorded a restructuring charge of $1.3 million for the year ended December 31, 2018. In addition to the restructuring costs in the table below, the Company has an estimated $1.3 million of cumulative translation adjustments that will be charged against net income (loss) and an estimated $1.0 million of tax benefits that will be realized upon liquidation of these foreign entities. GSE expects to recognize the remaining restructuring costs, currency translation adjustments and tax benefits in 2020. For the year ended December 31, 2019, we made payments related to our international restructuring for employee termination benefits and other legal expenses in the amount of $54,000 that had been previously accrued. DP Engineering Restructuring During the third quarter of 2019, the Company implemented a restructuring plan as a result of the work suspension of DP Engineering’s largest customer and subsequent notification on August 6, 2019 that the Engineer of Choice contract was being terminated. Accordingly, the Company took the necessary measures to reduce DP’s workforce by approximately 12 FTE’s and in addition terminated one of its office leases early resulting in one-time costs of $0.3 million being paid in the third quarter. This reduction in force aligns the workforce to the current level of business going forward. Lease abandonment As of December 31, 2019, management decided abandon, a portion of several operating lease right of use lease assets in long idled space in our Sykesville office and in DP Engineering’s Fort Worth office. This was decided as part of on the on-going restructuring plans to right size the organization. Management determined the square footage which would remain in use and took steps to insure the abandoned space was separated from the remaining in use space, end access of all employees to the abandoned sections, and remove any remaining office furniture assets. We applied the abandonment guidance in ASC 360-10-35. We believe “abandonment” means ceasing to use the underlying asset and lacking either the intent or the ability to sublease the underlying asset. Accordingly, lease abandonment restructuring charges incurred relating to the right of use assets for the year ended December 31, 2019 totaled $1.5 million. The following table shows the abandoned square footage and right of use asset details: Sykesville DP Engineering Total Square Ft in use December 1, 2019 36,549 19,871 56,420 Square Ft in use December 31, 2019 14,636 9,936 24,572 Abandoned Square Ft 21,913 9,936 31,849 (in thousands) Pre-Abandonment ROU Balance $ 1,474 $ 1,291 $ 2,765 Post-Abandonment Balance 590 646 1,236 Abandonment ROU 884 646 1,529 Collectively, for the year ended December 31, 2019, the Company recorded restructuring charges of approximately $2.5 million, of which $0.3 million related to DP Engineering severance and lease termination, and $1.5 million lease abandonment charges, and $0.5 million related to an executive departure related to the suspension of the Company’s acquisition strategy. The following table shows the total restructuring costs: Total Expected Restructuring Costs Total 2019 Restructuring Costs Restructuring Costs Lease Abandonment $ 1,529 $ 1,529 Lease Abandonment costs 57 57 Lease termination costs 39 39 International Restructuring 106 106 Employee termination benefits 747 747 Total $ 2,478 $ 2,478 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets [Abstract] | |
Goodwill and Intangible Assets | 7. Goodwill and Intangible Assets Intangible Assets Subject to Amortization Amortization of intangible assets other than goodwill is recognized on a straight-line basis over the estimated useful life of the intangible assets, except for customer relationships which are recognized in proportion to the related projected revenue streams. Intangible assets with definite lives are reviewed for impairment if indicators of impairment arise. The Company does not have any intangible assets with indefinite useful lives, other than goodwill. As discussed in Note 4, we recognized definite-lived intangible assets of $6.8 million upon acquisition of DP Engineering on February 15, 2019, including customer contracts and relationships, trademarks and non-compete agreements, with amortization periods of 5 to 15 years. Amortization of our definite-lived intangible assets is recognized on a straight-line basis over the estimate useful life of the associated assets. Following the February 23, 2019 event occurring at a DP Engineering customer location and subsequent receipt of the Notice of Suspension on February 28, 2019, the Company concluded that DP Engineering’s relationship with its largest customer has been adversely impacted. The DP Engineering customer contracts and relationships were the major component of the definite-lived intangible assets recognized in connection with the acquisition of DP Engineering. Accordingly, the Company determined that a triggering event had occurred requiring an interim assessment of whether a potential impairment of definite-lived intangible asset impairment test was necessary. Therefore, the impairment test of the definite-lived intangible assets recognized upon the acquisition of DP Engineering was also conducted according to ASC 350, Intangibles-Goodwill and other The interim impairment test was based on the present value of revised cash flow projected for 5 to 15 years. The result of the impairment test concluded no impairment of the definite-lived intangibles was necessary because the undiscounted cash flow of the asset group exceeds the adjusted carrying value. Due to the August 6, 2019 Notice of Termination of the Engineer of Choice agreement with DP Engineering, the Company performed an additional interim impairment test as of September 30, 2019 and determined no further impairment testing is needed. As described in Note 3, a revision was made to prior periods regarding the impairment of DP Engineering. The following table shows the gross carrying amount and accumulated amortization of definite-lived intangible assets: (in thousands) As of December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Amortized intangible assets Customer relationships $ 11,730 $ (4,079 ) $ 7,651 Trade names 2,467 (727 ) 1,740 Developed technology 471 (471 ) - Non-contractual customer relationships 433 (433 ) - Noncompete agreement 949 (217 ) 732 Alliance agreement 527 (171 ) 356 Others 167 (167 ) - Total $ 16,744 $ (6,265 ) $ 10,479 (in thousands) As of December 31, 2018 Gross Carrying Amount Accumulated Amortization Net Amortized intangible assets Customer relationships $ 6,831 $ (2,375 ) $ 4,456 Trade names 1,295 (318 ) 977 Developed technology 471 (471 ) - Non-contractual customer relationships 433 (433 ) - Noncompete agreement 221 (35 ) 186 Alliance agreement 527 (66 ) 461 Noncompete agreement 167 (167 ) - Total $ 9,945 $ (3,865 ) $ 6,080 Amortization expense related to definite-lived intangible assets totaled $2.4 million and 1.6 million for the years ended December 31, 2019 and 2018, respectively. The following table shows the estimated amortization expense of the definite-lived intangible assets for the next five years: (in thousands) Years ended December 31: 2020 $ 2,808 2021 2,143 2022 1,626 2023 1,199 Thereafter 2,703 $ 10,479 Goodwill The Company reviews goodwill for impairment annually as of December 31 and whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. The Company tests goodwill at the reporting unit level. A reporting unit is an operating segment, or one level below an operating segment, as defined by U.S. GAAP. After the acquisition of Hyperspring on November 14, 2014, the Company determined that it had two reporting units, which are the same as our two operating segments: (i) Performance Improvement Solutions; and (ii) Nuclear Industry Training and Consulting (which includes Hyperspring and Absolute). On February 15, 2019, we acquired DP Engineering (as described in Note 4) and preliminarily recorded goodwill and identified intangible assets as part of the acquisition. On February 23, 2019, an unexpected event occurred at one of DP Engineering’s significant customers and all pending work for that customer was suspended on February 28, 2019 pending a root cause analysis. While that analysis is now complete, and virtually all of the suspended projects have been restarted, the customer terminated the existing contract on August 6, 2019. The Company determined that the notice of suspension was a triggering event necessitating a goodwill impairment test. On May 10, 2019, the Company determined that a triggering event had occurred, requiring an assessment for impairment to be completed. The impairment test used an income-based approach with discounted cash flow method, and market-based approach including both guideline public company method and merger and acquisition method. The impairment test results indicated that the current estimated fair value of goodwill recorded from the acquisition of DP Engineering had declined below its initial estimated fair value at the acquisition date. As a result, the Company recognized an impairment charge of $5.6 million to write down the goodwill on DP Engineering. The Company determined that the impact of the suspension of obtaining new contracts from that customer resulted in a material downward revision to DP Engineering’s revenue and profitability forecasts when compared to the acquisition date valuation. The impairment charge on goodwill was recorded within “Loss on impairment” in our consolidated statements of operations. Due to the August 6, 2019 Notice of Termination of the Engineer of Choice agreement with DP Engineering, the Company performed, under ASC 350 guidance, additional impairment testing as of September 30, 2019 and at this time have determined no further impairment is needed. As described in Note 3, a revision was made to prior periods regarding the impairment of DP Engineering. For the annual goodwill impairment test as of December 31, 2019, the Company performed a quantitative step 1 goodwill impairment analysis and have concluded that the estimated fair values of each of the reporting units exceeded their respective carrying values. No additional goodwill impairment was recorded at year end 2019. As of December 31, 2019 and 2018, goodwill of $13.3 million and $13.2 million, respectively, related to the acquisitions of Hyperspring, Absolute, True North Consulting, and DP Engineering. $5.6 million impairment of goodwill was recorded in 2019. The change in the net carrying amount of goodwill from January 1, 2018 through December 31, 2019 was comprised of the following items: (in thousands) Performance Improvement Solutions Nuclear Industry Training and Consulting Total Net book value at January 1, 2018 $ - $ 8,431 $ 8,431 Acquisition 4,739 - 4,739 Dispositions - - - Goodwill impairment loss - - - Net book value at December 31, 2018 $ 4,739 $ 8,431 $ 13,170 Acquisition 5,766 - 5,766 Dispositions - - - Goodwill impairment loss (5,597 ) - (5,597 ) Net book value at December 31, 2019 $ 4,908 $ 8,431 $ 13,339 |
Contract Receivables
Contract Receivables | 12 Months Ended |
Dec. 31, 2019 | |
Contract Receivables [Abstract] | |
Contract Receivables | 8. Contract Receivables Contract receivables represent the Company’s unconditional rights to considerations due from a broad base of both domestic and international customers. All contract receivables are considered to be collectible within twelve months. Recoverable costs and accrued profit not billed represent costs incurred and associated profit accrued on contracts that will become billable upon future milestones or completion of contracts. The components of contract receivables are as follows: (in thousands) December 31, 2019 2018 Billed receivables $ 11,041 $ 15,998 Unbilled receivables 6,624 5,506 Allowance for doubtful accounts (458 ) (427 ) Total contract receivables, net $ 17,207 $ 21,077 Management reviews collectability of receivables periodically and records an allowance for doubtful accounts to reduce our receivables to their net realizable value when it is probable that the Company will not be able to collect all amounts due according to the contractual terms of the receivable. The allowance for doubtful accounts is based on historical trends of past due accounts, write-offs, and specific identification and review of customer accounts. During the years ended December 31, 2019 and 2018, the Company recorded bad debt expense of $31,000 and $294,000, respectively. During January 2020, the Company invoiced $3.8 million of the unbilled amounts related to the balance at December 31, 2019. The activity in the allowance for doubtful accounts is as follows: (in thousands) As of and for the Years ended December 31, 2019 2018 Beginning balance $ 427 $ 137 Current year provision 31 294 Current year write-offs - - Currency adjustment - (4 ) Ending balance $ 458 $ 427 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 31, 2019 | |
Prepaid Expenses and Other Current Assets [Abstract] | |
Prepaid Expenses and Other Current Assets | 9. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following: (in thousands) December 31, 2019 2018 Inventory $ - $ 139 Income tax receivable 237 310 Prepaid expenses 861 556 Other current assets 782 795 Total $ 1,880 $ 1,800 Inventory composed of raw material, is being purchased to support the construction of three major nuclear simulation projects related to a significant contract that was executed during the first quarter of 2016. The construction was completed in the first quarter of 2019. Inventory is recorded at the lower of cost or net realizable value in accordance with ASC 330, Inventory. Other current assets primarily include value-added tax receivables and cash deposited in a Swedish tax account. Prepaid expenses primarily include prepayment for insurance and other subscription based services. |
Equipment, Software, and Leaseh
Equipment, Software, and Leasehold Improvements | 12 Months Ended |
Dec. 31, 2019 | |
Equipment, Software and Leasehold Improvements [Abstract] | |
Equipment, Software and Leasehold Improvements | 10. Equipment, Software and Leasehold Improvements Equipment, software and leasehold improvements, net consist of the following: (in thousands) December 31, 2019 2018 Computer and equipment $ 2,266 $ 2,178 Software 1,693 1,682 Leasehold improvements 664 619 Furniture and fixtures 900 814 5,523 5,293 Accumulated depreciation (4,584 ) (4,228 ) Equipment, software and leasehold improvements, net $ 939 $ 1,065 Depreciation expense was $0.4 million and $0.5 million for the years ended December 31, 2019 and 2018, respectively. |
Product Warranty
Product Warranty | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Warranty [Abstract] | |
Product Warranty | 11. Product Warranty Accrued warranty For contracts that contain a warranty provision, the Company provides an accrual for estimated future warranty costs based on historical experience and projected claims. The Company’s contracts may contain warranty provisions ranging from one year to five years. The current portion of the accrued warranty is presented separately on the consolidated balance sheets within current liabilities whereas the noncurrent portion is included in other liabilities. In the final quarter of 2019 management reassessed the warranty percentage used in determining project budgets for warranty projects which were active at the end of 2019 and used in project budgets for non-warranty projects active at the end of 2019. In 2018 and prior periods, the GSE standard warranty was 4% of non-physical material cost of an individual project. Physical material is excluded from this target as the associated vendor typically provides their own warranty. Based on historical warranty costs, trends in actual expenses incurred and discussions with sales managers, it is management’s determination that a 3% warranty provision is a conservative estimate for all warranty costs both for active warranty projects and active non-warranty projects. The adjustment of this change resulted in a $0.2 million decrease in warranty provision. The activity in the accrued warranty accounts is as follows: (in thousands) As of and for the years ended December 31, 2019 2018 Beginning balance $ 1,621 $ 1,953 Current year provision (133 ) (107 ) Current year claims (164 ) (215 ) Currency adjustment (1 ) (10 ) Ending balance $ 1,323 $ 1,621 The current and non-current warranty balance is as follows: Years ended December 31, 2019 2018 Current $ 921 $ 981 Non-current 402 640 Total Warranty $ 1,323 $ 1,621 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value of Financial Instruments [Abstract] | |
Fair Value of Financial Instruments | 12. Fair Value of Financial Instruments ASC 820, Fair Value Measurement The levels of the fair value hierarchy established by ASC 820 are: Level 1: inputs are quoted prices, unadjusted, in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2: inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. A Level 2 input must be observable for substantially the full term of the asset or liability. The Monte Carlo model was used to calculate the fair value of level 2 instruments. The inputs used are current stock price, expected term, risk-free rate, number of trials, volatility and interest rates. Level 3: inputs are unobservable and reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability. The contingent consideration was based on EBITDA. The Company considers the recorded value of certain of its financial assets and liabilities, which consist primarily of cash equivalents, accounts receivable and accounts payable, to approximate the fair value of the respective assets and liabilities at December 31, 2019 and 2018 based upon the short-term nature of the assets and liabilities. As of December 31, 2019, the Company had four standby letters of credit totaling $1.2 million which represent performance bonds on three contracts. The following table presents assets and liabilities measured at fair value at December 31, 2019: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) (Level 1) (Level 2) (Level 3) Total Money market funds $ 434 $ - $ - $ 434 Foreign exchange contracts - 49 - 49 Total assets $ 434 $ 49 $ - $ 483 Liability awards - (9 ) - (9 ) Interest rate swap contract - (160 ) - (160 ) Total liabilities $ - $ (169 ) $ - $ (169 ) The following table presents assets and liabilities measured at fair value at December 31, 2018: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) (Level 1) (Level 2) (Level 3) Total Money market funds $ 824 $ - $ - $ 824 Foreign exchange contracts - 43 - 43 Total assets $ 824 $ 43 $ - $ 867 Liability awards $ - $ (118 ) $ - $ (118 ) Interest rate swap contract - (103 ) - (103 ) Total liabilities $ - $ (221 ) $ - $ (221 ) During the years ended December 31, 2019 and 2018, the Company did not have any transfers into or out of Level 3. The following table provides a roll-forward of the fair value of the contingent consideration categorized as Level 3 for the year ended December 31, 2019: (in thousands) Balance, January 1, 2019 $ - Issuance of contingent consideration in connection with acquisitions 1,200 Change in fair value (1,200 ) Balance, December 31, 2019 $ - |
Debt
Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt [Abstract] | |
Debt | 13. Debt Citizen’s Bank The Company entered into a three-year, $5.0 million revolving line of credit facility (RLOC) with Citizen’s Bank (the “Bank”) on December 29, 2016, to fund general working capital needs, including acquisitions. The Company is not required to maintain a restricted cash collateral account at the Bank for outstanding letters of credit and working capital advances. The credit facility agreement is subject to standard financial covenants and reporting requirements. On May 11, 2018, the Company entered into an Amended and Restated Credit and Security Agreement (the Credit Agreement) with the Bank, amending and restating the Company’s existing Credit and Security Agreement with the Bank, which included a $5.0 million asset-based revolving credit facility between the Company and the Bank, to now include (a) a $5.0 million revolving credit facility not subject to a borrowing base, including a letter of credit sub-facility, and (b) a $25.0 million delayed-draw term loan facility available to be drawn upon for up to 18 months and to finance certain permitted acquisitions by the Company. The credit facilities mature in five years and bear interest at LIBOR plus a margin that varies depending on the overall leverage ratio of the Company and its subsidiaries. Revolving loans are interest-only with principal due at maturity, while term loans require monthly payments of principal and interest based on an amortization schedule. The Company’s obligations under the Credit Agreement are guaranteed by GSE’s wholly-owned subsidiaries Hyperspring, Absolute, and True North and by any future material domestic subsidiaries (collectively, the Guarantors). Attendant to the Company’s acquisition of DP Engineering, the Company and the Bank entered into a Third Amendment and Reaffirmation Agreement and a Fourth Amendment and Reaffirmation Agreement on February 15, 2019 and March 20, 2019, respectively. On June 28, 2019, the Company and the Bank entered into a Fifth Amendment and Reaffirmation Agreement, which changed the fixed charge coverage ratio from 1.25, to four different ratios ranging from 1.05 to 1.25 among different time periods and changed the leverage ratio to: (i) 2.75 to 1.00 for the periods ending on June 30, 2019, September 30, 2019, December 31, 2019 and March 31, 2020; (ii) 2.50 to 1.00 for the periods ending June 30, 2020 and September 30, 2020; (iii) 2.25 to 1.00 for the periods ending December 31st, March 31st, June 30th and September 30th thereafter. On January 8, 2020, the Company entered into a Sixth Amendment and Reaffirmation Agreement. The amendments contained therein relaxed the fixed charge coverage ratio and leverage ratio, as well as delayed testing of both financial covenants, but added a covenant requiring that the Company maintain a consolidated, Adjusted EBITDA target of $4.25 million to be tested as of December 31, 2019, March 31, 2020, and June 30, 2020. Further, the Company agreed to maintain a minimum USA Liquidity of at least $5.0 million in the aggregate, to be tested bi-weekly as of the fifteenth (15th) and the last day of each month beginning on December 31, 2019 and thereafter until June 30, 2020 In addition to the revised covenants, GSE was required to pay a $20,000 bank fee and additional principal payments as follows: January 6, 2020 of $3.0 million, March 31, 2020 of $1.0 million, and June 30, 2020 of $1.0 million. On April 17, 2020, the Company entered into a Seventh Amendment and Reaffirmation Agreement. The Company shall maintain a minimum fixed charge coverage ratio of 1.25 to 1.00, to be tested quarterly as of the last day of each quarter beginning with the quarter ending June 30, 2021, on rolling four-quarter basis. The Company shall not exceed a maximum leverage ratio, to be tested quarterly as of the last day of each quarter beginning with the quarter ending September 30, 2020, on a rolling four-quarter basis as follows: (i) 3.00 to 1.00 for the period ending on September 30, 2020, (ii) 2.50 to 1.00 for the period ending on December 31, 2020, and (iii) 2.25 to 1.00 for the period ending on March 31, 2021 and for the periods ending on each December 31, March 31, June 30 and September 30 thereafter. In addition to the revised covenants, GSE was required to pay a $50,000 bank fee and additional principal payments as follows: April 17, 2020 $0.75, and June 30, 2020 $0.5 million. The Company has the option to refinance the term loan facility if certain requirements are met, including meeting certain covenant thresholds. RLOC The Company entered into a three-year, $5.0 million revolving line of credit facility with the Bank on December 29, 2016, to fund general working capital needs. We intend to continue using the RLOC for short-term working capital needs and the issuance of letters of credit in connection with business operations. Letter of credit issuance fees range between 1.25% and 2% depending on the Company’s overall leverage ratio, and the Company pays an unused RLOC fee quarterly based on the average daily unused balance. At December 31, 2019, there were no outstanding borrowings under the RLOC and four letters of credit totaling $1.2 million. The amount available at December 31, 2019, after consideration of the letters of credit was approximately $3.8 million. At December 31, 2018, there were no outstanding borrowings on the RLOC and 5 letters of credit totaling $2.3 million. Term Loan As discussed in Note 4, we acquired DP Engineering on February 15, 2019 for approximately $13.5 million in cash. The purchase price was subject to customary pre- and post-closing working capital adjustments plus an additional earn-out amount not to exceed $5.0 million potentially payable in 2020 and 2021. We drew down $14.3 million to finance the acquisition of DP Engineering. The loan bears interest at the adjusted LIBOR plus a margin ranging between 2% and 2.75% depending on the overall leverage ratio of the Company and matures in five years. There were no debt issuance costs and loan origination fees associated with the loan related for our acquisition of DP Engineering. Additionally, as discussed in Note 4, we acquired True North on May 11, 2018 for total consideration of approximately $9.9 million in cash. We drew down $10.3 million to finance the acquisition of True North, $0.5 million of which was repaid to the Bank on the same day. The loan bears interest at the adjusted one month-LIBOR plus a margin ranging between 2% and 2.75% depending on the overall leverage ratio of the Company and matures in five years on May 11, 2023. We also incurred $70,000 debt issuance costs and $75,000 loan origination fees related to the Credit Agreement. Debt issuance costs and loan origination fees are reported as a direct deduction from the carrying amount of the loan and are amortized over the term of the loan using the effective interest method. At December 31, 2019, the outstanding debt under the delayed draw term loan facility was as follows: Long-term debt, net of discount $ 18,481 Less: current portion of long-term debt 18,481 Long-term debt, less current portion $ - As discussed in Note 1, substantial doubt has been raised regarding the Company’s ability to continue as a going concern due to a probable covenant violation. As such, the classification of our debt is current. The Credit Agreement contains customary covenants and restrictions typical for a financing of this type that, among other things, require the Company to satisfy certain financial covenants and restrict the Company’s ability to incur additional debt, pay dividends and make distributions, make certain investments and acquisitions, repurchase its stock and prepay certain indebtedness, create liens, enter into agreements with affiliates, modify the nature of its business, enter into sale-leaseback transactions, transfer and sell material assets and merge or consolidate. Non-compliance with one or more of the covenants and restrictions after any applicable grace period could result in the obligations under the Credit Agreement becoming immediately due and payable and termination of the credit facilities. In addition to non-compliance with covenants and restrictions, the Credit Agreement also contains other customary events of default. If an event of default under the Credit Agreement occurs and is continuing, then the Bank may declare the obligations under the Credit Agreement to be immediately due and payable and may terminate the credit facilities. |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments [Abstract] | |
Derivative Instruments | 14. Derivative Instruments In the normal course of business, our operations are exposed to fluctuations in foreign currency values and interest rate changes. We may seek to control a portion of these risks through a risk management program that includes the use of derivative instruments. Foreign Currency Risk Management The Company utilizes forward foreign currency exchange contracts to manage market risks associated with the fluctuations in foreign currency exchange rates and minimize credit exposure by limiting counterparties to nationally recognized financial institutions. As of December 31, 2019, the Company had foreign exchange contracts outstanding of approximately 1.0 million Euro, which will be valid through March 2020. At December 31, 2018, the Company had contracts outstanding of approximately 3.2 million Euro at fixed rates. The contracts outstanding at December 31, 2019 have expired on various dates from January through March 2020. Interest Rate Risk Management As discussed in Note 13, the Company entered into a term loan to finance the acquisition of True North in May 2018, and subsequently DP Engineering, which was later amended on June 28, 2019, January 7, 2020 and April 17, 2020. The loan bears interest at adjusted one-month LIBOR plus a margin ranging between 2% and 2.75% depending on the overall leverage ratio of the Company. As part of our overall risk management policies, in June 2018, the Company entered into a pay-fixed, receive-floating interest rate swap contract with a notional amount of $9.0 million to reduce the impact associated with interest rate fluctuations The Company reports all derivatives at fair value. These contracts are recognized as either assets or liabilities, depending upon the derivative’s fair value. The estimated net fair values of the derivative contracts on the consolidated balance sheets are as follows: December 31, (in thousands) 2019 2018 Asset derivatives Prepaid expenses and other current assets $ 49 $ 43 49 43 Liability derivatives Other liabilities (160 ) (103 ) (160 ) (103 ) Net fair value $ (111 ) $ (60 ) The Company has not designated the derivative contracts as hedges. The changes in the fair value of the derivative contracts are included in (loss) gain on derivative instruments, net, in the consolidated statements of operations. The foreign currency denominated contract receivables, billings in excess of revenue earned, and subcontractor accruals that are related to the outstanding foreign exchange contracts are remeasured at the end of each period into the functional currency using the current exchange rate at the end of the period. The gain or loss resulting from such remeasurement is also included in (loss) gain on derivative instruments, net, in the consolidated statements of operations. For the years ended December 31, 2019 and 2018, the Company recognized a net (loss) gain on its derivative instruments as outlined below: Years ended December 31, (in thousands) 2019 2018 Foreign exchange contracts- change in fair value $ 6 $ (150 ) Interest rate swap - change in fair value (57 ) (103 ) Remeasurement of related contract receivables and billings in excess of revenue earned 38 (97 ) $ (13 ) $ (350 ) |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes [Abstract] | |
Income Taxes | 15. Income Taxes The consolidated income before income taxes, by domestic and foreign sources, is as follows: (in thousands) Years ended December 31, 2019 2018 Domestic $ (6,671 ) $ 2,512 Foreign 319 (1,735 ) Total $ (6,352 ) $ 777 The provision for income taxes is as follows: (in thousands) Years ended December 31, 2019 2018 Current: Federal $ (30 ) $ (6 ) State 60 259 Foreign 354 234 Subtotal 384 487 Deferred: Federal 4,686 600 State 663 67 Foreign - (23 ) Subtotal 5,349 644 Total $ 5,733 $ 1,131 The effective income tax rate for the years ended December 31, 2019 and 2018 differed from the statutory federal income tax rate as presented below: Effective Tax Rate percentage (%) Years ended December 31, 2019 2018 Statutory federal income tax rate 21.0 % 21.0 % State income taxes, net of federal tax benefit (12.1 )% 30.1 % Effect of foreign operations (0.3 )% (2.1 )% Change in valuation allowance (93.1 )% (43.6 )% Meals and Entertainment (1.4 )% 10.0 % Stock based compensation (1.4 )% (6.9 )% Other permanent differences (0.6 )% 0.4 % Uncertain Tax Positions 0.9 % 46.3 % Change in tax rate 0.0 % (2.8 )% Expired stock options 0.0 % 50.7 % Change in APB 23 0.0 % (4.4 )% Prior year reconciling items (3.3 )% (2.4 )% Expiration of capital Loss 0.0 % 49.3 % Effective tax rate (90.3 )% 145.6 % The difference between the effective rate and statutory rate in 2019 primarily resulted from the recognition of a valuation allowance, permanent differences, accruals related to uncertain tax positions for certain foreign tax contingencies and revenue recognition, and return to provision true-ups. The difference between the effective tax rate and statutory rate in 2018 primarily resulted from permanent differences, the write-off of the stock option deferred tax asset due to expirations, accruals related to uncertain tax positions for certain foreign tax contingencies and revenue recognition, expiration of capital loss, and return to provision true-ups. Deferred income taxes arise from temporary differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements. A summary of the tax effect of the significant components of the deferred income tax assets and liabilities is as follows: (in thousands) As of December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 4,396 $ 4,074 Accruals 247 760 Reserves 408 479 Alternative minimum tax credit carryforwards 126 213 Stock-based compensation expense 539 563 Intangible assets 1,021 674 Goodwill 1,037 - Operating lease liabilities 998 - Other 464 324 Total deferred tax assets 9,236 7,087 Valuation allowance (7,576 ) (756 ) Total deferred tax assets less valuation allowance 1,660 6,331 Deferred tax liabilities: Undistributed earnings of foreign subsidiary - (103 ) Software development costs (161 ) (163 ) Fixed assets (7 ) (44 ) Intangible assets (22 ) - Indefinite-lived intangibles (728 ) (525 ) Operating lease - right of use assets (510 ) - Other (175 ) (138 ) Total deferred tax liabilities (1,603 ) (973 ) Net deferred tax assets $ 57 $ 5,358 Deferred tax liabilities are included in “Other Liabilities” on the consolidated balance sheets. As of December 31, 2018, there was a deferred tax liability related to the operations in India. As a result of the sale of the India subsidiary during 2019, there is no longer a deferred tax liability as of December 31, 2019. The Company files tax returns in the United States federal jurisdiction and in several state and foreign jurisdictions. Because of the net operating loss carryforwards, the Company is subject to U.S. federal and state income tax examinations for tax years 2000, and forward, and is subject to foreign tax examinations by tax authorities for the years 2014 and forward. Open tax years related to state and foreign jurisdictions remain subject to examination but are not considered material to our financial position, results of operations or cash flows. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some or all of the deferred tax assets will not be realized. The Company’s ability to realize its deferred tax assets depends primarily upon the preponderance of positive evidence that could be demonstrated by three year cumulative positive earnings, reversal of existing deferred temporary differences, and generation of sufficient future taxable income to allow for the utilization of deductible temporary differences. As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact management’s view with regard to the future realization of deferred tax assets to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. The analysis is performed on a jurisdiction by jurisdiction basis. The Company provides forward forecasting which is incorporated into the scheduling analysis to support realization of the deferred tax assets. The Company performed a detailed analysis of the valuation allowance position for it’s worldwide deferred tax assets. Both objectively verifiable positive and negative evidence are considered in the analysis. When analyzing the need for a valuation allowance, the Company first looks to the history of cumulative income or losses and three years is generally considered a reliable measure of historical earnings. At September 30, 2019, the Company relied upon the strength of its three year cumulative positive core earnings and the projection of future taxable income in the U.S., both of which supported the realization of all of the U.S. deferred tax assets. At this time, the Company determined that a valuation allowance in the U.S. was not appropriate. Since the third quarter analysis, the U.S. three year cumulative positive core earnings has decreased substantially. Furthermore, due to substantial doubt about the entity’s ability to continue as a going concern, the Company no longer feels that it can rely upon forecasted future earnings and its impact on future taxable income in the valuation allowance analysis. Accordingly, the Company has determined that it does not have sufficient positive, objectively verifiable evidence to substantiate the realizability of the U.S. deferred tax assets at December 31, 2019 and therefore a valuation allowance is appropriate at this time on its U.S. deferred tax assets in the amount of $6.9 million, with the exception of its alternative minimum tax credit that will be refunded at the filing of its 2019 U.S. income tax return. Due to a history of losses in the U.K. and Sweden and the inability to rely upon forecasted future earnings in China and Slovakia due to the going concern opinion, the Company does not have sufficient positive, objectively verifiable evidence to substantiate the recovery of the deferred tax assets for its U.K., Swedish, and Chinese deferred tax assets at December 31, 2019. Accordingly, a full valuation allowance of $0.7 million has been established on these deferred tax assets, predominantly comprised of net operating losses. At December 31, 2019, the Company’s largest consolidated deferred tax asset was $5.3 million of net operating losses, excluding the impact of uncertain tax provisions. It primarily relates to a U.S. Federal net operating loss carryforward of $4.0 million net ($19.2 million gross). $3.9 million net ($18.5 million gross) of the net operating loss carryforward expires in various amounts between 2023 and 2037; $0.1 million net ($0.7 million gross) of the net operating loss carryforward is an indefinite lived deferred tax asset. The net operating loss deferred tax asset also includes $0.7 million net of state net operating losses. $0.5 million net of the state net operating loss carryforwards expire in various amounts through 2039; $0.2 million of the state net operating loss is an indefinite lived deferred tax asset. The net operating loss deferred tax asset also includes $0.6 million net ($2.8 million gross) of net operating losses from international operations which is an indefinite lived deferred tax asset. As of December 31, 2019 and 2018, the Company’s consolidated cash and cash equivalents totaled $11.7 million and $12.1 million, respectively, including cash and cash equivalents held at non-U.S. entities totaling $4.4 million and $4.7 million, respectively. The non-U.S. entities include operating subsidiaries located in China, United Kingdom, Sweden and Slovakia. Of these, the Company does not assert permanent reinvestment in the UK, Sweden or Slovakia. Accordingly, the Company analyzed the cumulative earnings and profits and determined no US deferred liability exists given aggregated accumulated deficits. Undistributed earnings in China are considered indefinitely reinvested as of December 31, 2019, to fund the Company’s ongoing international operations. If the Company were to repatriate funds from China, the Company would not incur any tax due to an accumulated earnings and profits deficit. The Company has made an entity classification (CTB) election to treat GSE UK as a disregarded entity effective January 1, 2018. Therefore, as of January 1, 2018, GSE UK is treated as a branch of the US for tax purposes. Accordingly, GSE UK’s 2019 activity has been included in the US Company’s income tax provision. Uncertain Tax Positions During 2019 and 2018, the Company recorded tax liabilities for certain foreign tax contingencies. The Company recorded these uncertain tax positions in other current liabilities on the consolidated balance sheets. During 2018, the Company recorded a tax liability for an uncertain tax position related to revenue recognition in the US. The uncertain tax position is recorded as a component of current and deferred liability. An accounting method change was filed with the 2018 tax return, accordingly, the uncertain tax position related to revenue recognition has been reversed in 2019. The following table outlines the Company’s uncertain tax liabilities, including accrued interest and penalties for each jurisdiction: China Ukraine South Korea U.S. (in thousands) Tax Interest and Penalties Tax Interest and Penalties Tax Interest and Penalties Tax Interest and Penalties Total Balance, January 1, 2018 $ 216 $ 262 $ 100 $ 28 $ 341 $ 45 $ 833 - $ 1,825 Increases - 23 - 44 120 66 163 4 420 Decreases 12 - 18 - - - - - 30 Balance, December 31, 2018 $ 204 $ 285 $ 82 $ 72 $ 461 $ 111 $ 996 $ 4 $ 2,215 Increases - 33 - - 93 67 - 2 195 Decreases 3 - 4 12 - - 203 - 222 Balance, December 31, 2019 $ 201 $ 318 $ 78 $ 60 $ 554 $ 178 $ 793 $ 6 $ 2,188 |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2019 | |
Capital Stock [Abstract] | |
Capital Stock | 16. Capital Stock The Company’s charter authorizes 62,000,000 total shares of stock, of which 60,000,000 shares have been designated as common stock and 2,000,000 are designated as preferred stock. The Board of Directors has the authority to establish one or more classes of preferred stock and to determine, within any class of preferred stock, the preferences, rights and other terms of such class. As of December 31, 2019, the Company has reserved 5,900,759 shares of common stock for issuance; 5,000 are reserved for shares upon exercise of outstanding stock options and 1,951,208 are reserved for shares upon vesting of restricted stock units. The Company has 1,599,241 shares available for future grants under the Company’s 1995 Long-Term Incentive Plan. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | 17. Stock-Based Compensation Long-term incentive plan During 1995, the Company established the 1995 Long-Term Incentive Stock Option Plan (the Plan), which permits the granting of stock options (including incentive stock options and nonqualified stock options) stock appreciation rights, restricted or unrestricted stock awards, phantom stock, performance awards or any combination of these to employees, directors or consultants. The Plan expires on April 21, 2026; the total number of shares that could be issued under the Plan is 7,500,000. As of December 31, 2019, 4,174,981 shares have been issued under the Plan, 5,000 stock options and 1,951,208 restricted stock units (RSUs) were outstanding under the Plan, while 1,599,241 shares remain for future grants under the Plan. The Company recognizes compensation expense on a pro rata straight-line basis over the requisite service period for stock-based compensation awards with both graded and cliff vesting terms. The Company recognizes the cumulative effect of a change in the number of awards expected to vest in compensation expense in the period of change. The Company has not capitalized any portion of its stock-based compensation. The Company’s forfeiture rate is based on actuals. During the years ended December 31, 2019 and 2018, the Company recognized $1.4 million and $1.5 million, respectively, of stock-based compensation expense under the fair value method. Accordingly, the Company recognized associated deferred income tax expense (benefits) of $86,000 and $(53,000), respectively, during the years ended December 31, 2019 and 2018. During the years ended December 31, 2019 and 2018, there were approximately $93,000 and $142,000 of stock-based compensation expense related to the change in fair value of cash-settled RSUs, which the Company accounts for as a liability. Stock options Options to purchase shares of the Company’s common stock under the Plan expire in either seven years or ten years from the date of grant and become exercisable in three, five, or seven installments with a certain percentage of options vesting on the first anniversary of the grant date and additional options vesting on each of the subsequent anniversaries of the grant date, subject to acceleration under certain circumstances. Information with respect to stock option activity as of and for the year ended December 31, 2019 is as follows: Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value (in thousands) Weighted Average Remaining Contractual Life (Years) Options outstanding at January 1, 2019 55,000 $ 1.87 Options granted - - Options exercised (50,000 ) 1.89 Options forfeited - - Options outstanding at December 31, 2019 5,000 1.65 $ - 0.87 Options expected to vest - - $ - - Options exercisable at December 31, 2019 5,000 $ - $ - - Information with respect to stock option activity as of and for the year ended December 31, 2018 is as follows: Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value (in thousands) Weighted Average Remaining Contractual Life (Years) Options outstanding at January 1, 2018 1,046,833 $ 3.33 Options granted - - Options exercised (486,500 ) 1.88 Options forfeited (505,333 ) 4.89 Options outstanding at December 31, 2018 55,000 1.87 $ 17 2.08 Options expected to vest - - $ - - Options exercisable at December 31, 2018 55,000 $ - $ - - The Company did not grant stock options during the years ended December 31, 2019, and 2018, and the number of options vested were zero and 24,000 respectively. The Company received cash for the exercise price associated with stock options exercised of $127,000 and $136,000 during the years ended December 31, 2019 and 2018, respectively. The total intrinsic value realized by participants on stock options exercised was $0 and $701,318 during the years ended December 31, 2019 and 2018, respectively. Restricted Stock Units During the years ended December 31, 2019 and 2018, the Company issued RSUs to employees which vest upon the achievement of specific market-based or time-based measures. The fair value for RSU’s is calculated based on the stock price on the grant date and expensed ratably over the requisite service period, which ranges between one year and five years. The following table summarizes the information about vested and unvested restricted stock units for the years ended December 31, 2019 and 2018. Number of Shares Weighted Average Fair Value Nonvested RSUs at January 1, 2018 1,634,663 $ 1.96 RSUs granted 428,526 3.23 RSUs forfeited (140,997 ) 2.47 RSUs vested (350,667 ) 3.30 Nonvested RSUs at December 31, 2018 1,571,525 $ 1.96 Nonvested RSUs at January 1, 2019 1,571,525 $ 1.96 RSUs granted 918,459 2.56 RSUs forfeited (64,172 ) 3.12 RSUs vested (452,087 ) 3.30 Nonvested RSUs at December 31, 2019 1,973,725 $ 1.49 As of December 31, 2019, the Company had $0.5 million of unrecognized compensation expense related to the RSUs expected to be recognized on a pro-rata straight line basis over a weighted average remaining service period of approximately 0.98 years. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | 18. Leases The Company maintains leases of office facilities and equipment. Leases generally have remaining terms of one year to five years, whereas leases with an initial term of twelve months or less are not recorded on the consolidated balance sheets. The Company recognizes lease expense for minimum lease payments on a straight-line basis over the term of the lease. Certain leases include options to renew or terminate. Renewal options are exercisable per the discretion of the Company and vary based on the nature of each lease, with renewal periods generally ranging from one year to five years. The term of the lease includes renewal periods only if the Company is reasonably certain that it will exercise the renewal option. When determining if a renewal option is reasonably certain of being exercised, the Company considers several factors, including but not limited to, the cost of moving to another location, the cost of disruption to operations, whether the purpose or location of the leased asset is unique and the contractual terms associated with extending the lease. Upon the adoption of the new lease standard ASU 2016-02, on January 1, 2019, the Company elected the package of practical expedients permitted under the transition guidance within the amended guidance, which among other things, allowed registrants to carry forward historical lease classification. Accordingly, all existing leases that were classified as operating leases by the Company historically, were classified as operating leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The operating lease ROU assets represent the lease liability, plus any lease payments made at or before the commencement date, less any lease incentives received. The Company’s real estate leases, which are comprised primarily of office spaces, represent a majority of the lease liability. The majority of our lease payments are fixed, although an immaterial portion of payments are variable in nature. Variable lease payments vary based on changes in facts and circumstances related to the use of the ROU assets and are recorded as incurred. The Company uses an incremental borrowing rate based on rates available at commencement in determining the present value of future payments. The Company has lease agreements with lease and non-lease components, which are accounted for as a single lease component. The Company applies a portfolio approach to effectively account for the operating lease ROU assets and liabilities. Lease abandonment As discussed in Note 6, as of December 31, 2019, management decided to abandon, a portion of several operating lease right of use lease assets in long idled space in our Sykesville office and in DP Engineering’s Fort Worth office. This was decided as part of the on-going restructuring plans to right size the organization. Management took steps to insure the abandoned space was separated from the remaining in use space, end access of all employees to the abandoned sections, and remove any remaining office furniture assets. We applied the abandonment guidance in ASC 360-10-35. We believe “abandonment” means ceasing to use the underlying asset and lacking either the intent or the ability to sublease the underlying asset. Accordingly, lease abandonment restructuring charges incurred relating to the ROU assets for the year ended December 31, 2019 totaled $1.5 million. Lease contracts are evaluated at inception to determine whether they contain a lease, where the Company obtains the right to control an identified asset. The following table summarizes the classification of operating ROU assets and lease liabilities on the consolidated balance sheets (in thousands): Operating Leases Classification December 31, 2019 Leased Assets Operating lease - right of use assets Long term assets $ 2,215 Lease Liabilities Operating lease liabilities - Current Other current liabilities 1,153 Operating lease liabilities Long term liabilities 3,000 $ 4,153 The Company executed a sublease agreement with a tenant to rent out 3,650 square feet from the lease at its Sykesville office on May 1, 2019. This agreement is in addition to the 3,822 of square feet previously subleased, which was entered into on April 1, 2017. The sublease does not relieve the Company of its primary lease obligation. The sublease agreements are both considered operating leases, maintaining the historical classification of the underlying lease. The Company does not recognize any underlying assets for the subleases as a lessor of operating leases. The net amount received from the sublease is recorded within selling, general and administrative expenses. The table below summarizes the lease income and expenses recorded in the consolidated statements of operations incurred year to date ended December 31, 2019 , ( in thousands Lease Cost Classification Twelve months ended December 31, 2019 Operating lease cost (1) Selling, general and administrative expenses $ 1,112 Short-term leases costs (2) Selling, general and administrative expenses 121 Sublease income (3) Selling, general and administrative expenses (107 ) Net lease cost $ 1,126 (1) (2) (3) The Company is obligated under certain noncancelable operating leases for office facilities and equipment. Future minimum lease payments under noncancelable operating leases as of December 31, 2019 are as follows: (in thousands) Gross Future Minimum Lease Payments 2020 $ 1,335 2021 1,293 2022 1,184 2023 622 2024 106 Thereafter - Total $ 4,540 Less: Interest 387 Present value of lease payments $ 4,153 The Company has calculated the weighted-average remaining lease term, presented in years below, and the weighted-average discount rate for our operating leases. As noted in our lease accounting policy, the Company uses the incremental borrowing rate as the lease discount rate: Lease Term and Discount Rate Twelve months ended December 31, 2019 Weighted-average remaining lease term (years) Operating leases 3.51 Weighted-average discount rate Operating leases 5.00% The table below sets out the classification of lease payments in the consolidated statement of cash flows. The ROU assets obtained in exchange for operating lease liabilities represent new operating leases obtained through our business combination during the year to date ended December 31, 2019: (in thousands) Other Information Twelve months ended December 31, 2019 - Operating cash flows used in operating leases $ 1,275 Cash paid for amounts included in measurement of liabilities 1,275 ROU assets obtained in exchange for new operating liabilities $ 1,777 |
Employee Benefits
Employee Benefits | 12 Months Ended |
Dec. 31, 2019 | |
Employee Benefits [Abstract] | |
Employee Benefits | 19. Employee Benefits The Company has a qualified defined contribution plan that covers all U.S. employees under Section 401(k) of the Internal Revenue Code. Under this plan, the Company’s stipulated basic contribution matches a portion of the participants’ contributions based upon a defined schedule for GSE Performance Improvement Solutions employees. The Company’s contributions to the plan were approximately $290,000 and $309,000 for the years ended December 31, 2019 and 2018, respectively. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2019 | |
Segment Information [Abstract] | |
Segment Information | 20. Segment Information The Company has two reportable business segments. The Performance Improvement Solutions segment provides simulation, training and engineering products and services delivered across the breadth of industries we serve. Solutions include simulation for both training and engineering applications. Example engineering services include, but are not limited to, plant design verification and validation, thermal performance evaluation and optimization programs, and engineering programs for plants for ASME code and ASME Section XI. The Company provides these services across all market segments. Example training applications include turnkey and custom training services. Contract terms are typically less than two years. The Nuclear Industry Training and Consulting segment provides specialized workforce solutions primarily to the nuclear industry, working at clients’ facilities. This business is managed through our Hyperspring and Absolute subsidiaries. The business model, management focus, margins and other factors clearly separate this business line from the rest of the GSE product and service portfolio. On February 15, 2019, through our wholly-owned subsidiary GSE Performance Solutions, Inc., the Company entered into the DP Engineering Purchase Agreement, to purchase 100% of the membership interests in DP Engineering. DP Engineering is a provider of value-added technical engineering solutions and consulting services to nuclear power plants with an emphasis on preparation and implementation of design modifications during plant outages. For reporting purposes, DP Engineering is included in our Performance Improvement Solutions segment due to similarities in services provided including engineering solutions and implementation of design modifications to the nuclear power sector. On May 11, 2018, GSE, through Performance Solutions acquired True North. True North is a provider of technical engineering solutions to nuclear and fossil fuel power plants with an emphasis on regulatory-driven ASME code programs. The acquisition of True North is expected to broaden our engineering services offering, expand our relationships with several of the largest nuclear energy providers in the United States, and add a highly specialized, complementary talent pool to our employee base. For reporting purposes, True North is included in our Performance Improvement Solutions segment due to similarities in services provided including technical engineering solutions to the nuclear and fossil fuel power sector. In September 20, 2017, the Company acquired Absolute. Absolute is a provider of technical consulting and staffing solutions to the global nuclear power industry and employs approximately 160 professionals with expertise in procedures writing, engineering, technical support, project management, training, project controls, and corrective actions. This acquisition brings a natural adjacency to GSE, fits well with our growth strategy, and benefits our customers from expanded capabilities and offerings. For reporting purposes, Absolute was aggregated with Hyperspring into our Nuclear Industry Training and Consulting segment due to similarities in services provided including training and staff augmentation to the nuclear energy sector. In addition, both entities report to the same management team and share support staff such as sales, recruiting and business development. As such, 100% of the goodwill acquired was allocated to the Nuclear Industry Training and Consulting segment. The following table sets forth the revenue and operating results attributable to each reportable segment and includes a reconciliation of segment revenue to consolidated revenue and operating results to consolidated income before income tax expense (benefit). Inter-segment revenue is eliminated in consolidation and is not significant. (in thousands) Years ended December 31, 2019 2018 Revenue: Performance Improvement Solutions $ 45,776 $ 42,954 Nuclear Industry Training and Consulting 37,199 49,295 $ 82,975 $ 92,249 Depreciation: Performance Improvement Solutions $ 345 $ 385 Nuclear Industry Training and Consulting 18 130 $ 363 $ 515 Amortization of definite-lived intangible assets: Performance Improvement Solutions $ 1,871 $ 898 Nuclear Industry Training and Consulting 529 714 $ 2,400 $ 1,612 Operating (loss) income Performance Improvement Solutions $ (5,802 ) $ 2,640 Nuclear Industry Training and Consulting (1,617 ) (1,274 ) Operating (loss) income $ (7,419 ) $ 1,366 Interest expense (988 ) (268 ) Loss on derivative instruments (13 ) (350 ) Other income (expense), net 2,068 29 Income (loss) before income taxes $ (6,352 ) $ 777 Additional information relating to segments is as follows: (in thousands) December 31, 2019 2018 Performance Improvement Solutions $ 41,550 $ 40,353 Nuclear Industry Training and Consulting 16,959 21,087 Total assets $ 58,509 $ 61,440 For the years ended December 31, 2019 and 2018, 90% and 91%, respectively, of the Company’s consolidated revenue was from customers in the nuclear power industry. The Company designs, develops and delivers business and technology solutions to the energy industry worldwide. Revenue, operating income (loss) and total assets for the Company’s United States, European, and Asian subsidiaries as of and for the years ended December 31, 2019 and 2018 are as follows: (in thousands) Year ended December 31, 2019 United States Europe Asia Eliminations Consolidated Revenue $ 81,597 $ - $ 1,378 $ - $ 82,975 Transfers between geographic locations 623 - 124 (747 ) - Total revenue $ 82,220 $ - $ 1,502 $ (747 ) $ 82,975 Operating income (loss) $ (7,710 ) $ 54 $ 237 $ - $ (7,419 ) Total assets, at December 31 $ 184,115 $ 3,526 $ 2,805 $ (131,937 ) $ 58,509 (in thousands) Year ended December 31, 2018 United States Europe Asia Eliminations Consolidated Revenue $ 88,979 $ 2,150 $ 1,120 $ - $ 92,249 Transfers between geographic locations 2,046 - 199 (2,245 ) - Total revenue $ 91,025 $ 2,150 $ 1,319 $ (2,245 ) $ 92,249 Operating income (loss) $ 2,902 $ (1,116 ) $ (420 ) $ - $ 1,366 Total assets, at December 31 $ 171,206 $ 3,893 $ 3,592 $ (117,251 ) $ 61,440 Revenues by geographic location above are attributed to the contracting entity. Therefore, revenues from a foreign customer that contracted directly with our U.S. entity are included in revenues from the United States. All revenues in Asia were attributable to our Chinese subsidiary. In Europe, total revenues for the year ended December 31, 2019 were zero due to the Sweden and UK office closures in 2018. Alternatively, revenues from customers domiciled in foreign countries were approximately 16% and 15%, of the Company’s consolidated 2019 and 2018 revenue, respectively. Revenues from foreign countries where our customers reside were all individually less than 10% of the Company’s consolidated revenues during 2019 and 2018. |
Supplemental Disclosure of Cash
Supplemental Disclosure of Cash Flow Information | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Disclosure of Cash Flow Information [Abstract] | |
Supplemental Disclosure of Cash Flow Information | 21. Supplemental Disclosure of Cash Flow Information (in thousands) Year ended December 31, 2019 2018 Cash paid: Interest $ 989 $ 278 Income taxes $ 489 $ 187 |
Non-consolidated Variable Inter
Non-consolidated Variable Interest Entity | 12 Months Ended |
Dec. 31, 2019 | |
Non-consolidated Variable Interest Entity [Abstract] | |
Non-consolidated Variable Interest Entity | 22. Non-consolidated Variable Interest Entity The Company, through its wholly owned subsidiary DP Engineering, effectively holds a 48% membership interest in DP-NXA Consultants LLC (“DP-NXA”). DP-NXA was established to provide industrial services that include civil, structural, architectural, electrical, fire protection, plumbing, mechanical consulting engineering services to customers. DP-NXA sub-contracts their work to its two owners, NXA Consultants LLC (“NXA”), which owns 52%of the entity, and DP Engineering. DP Engineering and NXA contributed $48,000 and $52,000, respectively, for 48% and 52% interest in DP-NXA. DP Engineering recorded the contributed cash as an equity investment. The Company evaluated the nature of DP Engineering’s investment in DP-NXA and determined that DP-NXA is a variable interest entity (“VIE”). Since the Company does not have the power to direct activities that most significantly impact DP-NXA, it cannot be DP-NXA’s primary beneficiary. Furthermore, the Company concluded that it did not hold a controlling financial interest in DP-NXA since NXA, the VIE’s majority owner, makes all operation and business decisions. The Company accounts for its investment in DP-NXA using the equity method of accounting due to the fact the Company exerts significant influence with its 48% of membership interest, but does not control the financial and operating decisions. The Company’s maximum exposure to any losses incurred by DP-NXA is limited to its investment. As of December 31, 2019, the Company has not made any additional contributions to DP-NXA and believes its maximum exposure to any losses incurred by DP-NXA was not material. As of December 31, 2019, the Company does not have existing guarantee with or to DP-NXA, or any third-party work contracted with it. For the year ended December 31, 2019, the carrying value of the investment in DP-NXA was zero. We do not have any investment income or loss from DP-NXA for the year to date ended December 31, 2019. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 23. Commitments and Contingencies Contingencies On March 29, 2019, a former employee of Absolute Consulting, Inc., filed a putative class action against Absolute and the Company, Joyce v. Absolute Consulting Inc., case number 1:19 cv 00868 RDB, in the United States District Court for the District of Maryland. The lawsuit alleges that plaintiff was not properly compensated for overtime hours that he worked. The Company has been dismissed from the case, but Absolute intends to vigorously defend this litigation with the Company’s assistance and support. The Company is unable to conclude that the likelihood of an unfavorable outcome in this matter is remote or probable, but Absolute continues to deny the allegations and defend the case. Legal defense costs are expensed as incurred. Per ASC 450 Accounting for Contingencies |
Contingent Consideration
Contingent Consideration | 12 Months Ended |
Dec. 31, 2019 | |
Contingent Consideration [Abstract] | |
Contingent Consideration | 24. Contingent Consideration Acquisitions may include contingent consideration payments based on future financial measures of an acquired company. Under ASC 805, contingent consideration is required to be recognized at fair value as of the acquisition date. We estimate the fair value of these liabilities based on financial projections of the acquired companies and estimated probabilities of achievement. At each reporting date, the contingent consideration obligation is revalued to estimated fair value and changes in fair value subsequent to the acquisition are reflected in income or expense in the consolidated statements of operations and could cause a material impact to our operating results. Changes in the fair value of contingent consideration obligations may result from changes in discount periods and rates, changes in the timing and amount of revenue and/or earnings estimates and changes in probability assumptions with respect to the likelihood of achieving the various earn-out criteria. In connection with the acquisition of DP Engineering on February 15, 2019, the Company recognized the estimated fair value of contingent consideration for $1.2 million. During the year ended December 31, 2019, as a result of the triggering event described in Note 7, an impairment test was conducted on DP Engineering’s goodwill and definite-lived intangible assets and the Company determined the $1.2 million of contingent consideration recognized upon acquisition of DP Engineering reduced to zero since the related earn-out payment is no longer expected to be paid. We have recorded this reduction as an offset to selling, general and administrative expenses in unaudited consolidated statements of operations. There was zero contingent liability as of December 31, 2019. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 25. Subsequent Events In December 2019, a novel strain of coronavirus, the COVID-19 virus, was reported in Wuhan, China. On January 30, 2020, the World Health Organization (“WHO”) announced a global health emergency because of the COVID-19 virus. On March 11, 2020, the WHO declared the COVID-19 a global pandemic and on March 13, 2020, President Donald J. Trump declared the virus a national emergency in the United States. As of the date of this report, both the health and economic aspects of COVID-19 are highly fluid and the future course of each is uncertain. As such, the ultimate impact the pandemic will have on the Company’s financial condition, liquidity, and future results of operations is highly uncertain and subject to change. Management is actively monitoring the situation on its financial condition, liquidity, operations, operations, industry, supplies, and workforce. Given the highly fluid situation of COVID-19 and the global response to prevent the spread, the Company is unable to estimate the impact of COVID-19 on our business operations, revenues and financial condition in fiscal year 2020. The outbreak could have a continued material adverse impact on economic and market conditions and trigger a period of global economic slowdown, which could impact the Company’s performance and trigger impairment of the Company’s goodwill and intangible assets. The Company is dependent on its workforce being deployed to deliver its services. Social distancing and shelter-in-place directives may impact the Company’s ability to deploy its workforce effectively. With regard to our Nuclear Industry Training and Consulting (“NITC”) business segment, because of the embedded presence of our on-site workforce, if COVID-19 or a similar outbreak of infectious disease were to prevent our workers from being deployed to the applicable customer site. While expected to be temporary, it may disrupt our NITC service offerings, interrupt performance on our NITC contracts with clients and negatively impact our business, financial condition and results of operations. The safety of our employees, their families and our customers are of primary concern to GSE. The company operates consistent with Federal and State guidelines. As a result, employees almost entirely work from home for the Performance Solutions segment, but for when required to be at the client site for essential project work. When at the client site, employees are required to become thoroughly familiar with client safety guidelines including COVID-19 guidelines. Performance Projects, since they are essential, for the most part continue without pause. For our staff augmentation, we have seen certain contract for NITC customers paused and or delayed as clients shrink their own on-premise workforces to the bare minimum in response to the pandemic; as a result the NITC business has seen its deployed billable employee base contract since the start of the pandemic. NITC still has a meaningful deployment of billable employees at client sites delivering essential services working at the direction of our customers. While we are still receiving new orders, we are experiencing a significant decline in the volume of new orders compared to prior periods. The COVID-19 crisis is still an evolving situation and we are unable to predict when it will end or the future impact it will have on the business and our operations will be. We have experienced current projects in our Performance Solutions and NITC segments being delayed or paused. The Company has been designated as an essential services provider for certain nuclear power and defense customers, which constitute greater than 90% of our business. We have significant debt principal payments on our term loan due in June 2020, which a decline in sales due to the impact of COVID-19 on consumers, our customers, or our ability to satisfy performance obligations, may lead to the Company seeking debt restructuring and additional sources financing. Additionally, it is probable we fail to meet certain covenant provisions in our debt arrangements due to the impact of COVID-19. On April 17, 2020 the Company entered into an Amendment and Reaffirmation Agreement with the Bank granting certain waivers and improved leverage ratios. We have made principal payments of $3.0 million in January 2020, $1.0 million March 2020, and $0.75 million April 2020 with a scheduled $1.5 million payment in June 2020. Although the Company cannot estimate the length or gravity of the impact of the COVID-19 outbreak at this time, as described above, for these reasons and other reasons that may come to light if the pandemic and associated protective or preventative measures expand, we may experience a material adverse effect on our business operations, revenues and financial condition in fiscal year 2020. CARES Act On March 27, 2020, the CARES Act was enacted. The CARES Act is an emergency economic stimulus package that includes spending and tax breaks to strengthen the United States economy and fund a nationwide effort to curtail the effect of COVID-19. While the CARES Act provides sweeping tax changes in response to the COVID-19 pandemic, some of the more significant provisions which are expected to impact the Company’s financial statements include removal of certain limitations on utilization of net operating losses and increasing the ability to deduct interest expense, as well as amending certain provisions of the previously enacted Tax Cuts and Jobs Act. Due to the recent enactment of the CARES Act, the Company is unable to fully quantify the impact, if any, that the CARES Act will have on its financial position, results of operations or cash flows. The Company has applied for, and has received, funds under the Paycheck Protection Program after the period end in the amount of $10.0 million serviced by Citizens Bank. The application for these funds requires the Company to, in good faith, certify that the current economic uncertainty made the loan request necessary to support the ongoing operations of the Company. This certification further requires the Company to take into account our current business activity and our ability to access other sources of liquidity sufficient to support ongoing operations in a manner that is not significantly detrimental to the business. The receipt of these funds, and the forgiveness of the loan attendant to these funds, is dependent on the Company having initially qualified for the loan and qualifying for the forgiveness of such loan based on our future adherence to the forgiveness criteria. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Principles of consolidation | Principles of consolidation GSE Systems, Inc. is a leading provider of professional and technical engineering, staffing services, and simulation software to clients in the power and process industries. References in this report to “GSE,” the “Company,” “we” and “our” are to GSE Systems and its subsidiaries, collectively. All intercompany balances and transactions have been eliminated in consolidation. |
Accounting estimates | Accounting estimates The preparation of the consolidated financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. On an ongoing basis, the Company evaluates the estimates used, including, but not limited to those related to revenue recognition on long-term contracts, allowance for doubtful accounts, product warranties, valuation of goodwill and intangible assets acquired, impairment of long-lived assets, valuation of contingent consideration issued in business acquisitions, valuation of stock based compensation awards and the recoverability of deferred tax assets. Actual results could differ from these estimates. |
Business combinations | Business combinations Business combinations are accounted for in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), ASC 805, Business Combinations, Revenues and the results of operations of the acquired business are included in the accompanying consolidated statements of operations commencing on the date of acquisition. Acquisitions may include contingent consideration payments based on future financial measures of an acquired company. Under ASC 805, contingent consideration is required to be recognized at fair value as of the acquisition date. We estimate the fair value of these liabilities based on financial projections of the acquired companies and estimated probabilities of achievement. At each reporting date, the contingent consideration obligation is revalued to estimated fair value, and changes in fair value subsequent to the acquisition are reflected in income or expense in the consolidated statements of operations, and could cause a material impact to our operating results. Changes in the fair value of contingent consideration obligations may result from changes in discount periods and rates, changes in the timing and amount of revenue and/or earnings estimates, and changes in probability assumptions with respect to the likelihood of achieving the various earn-out criteria. |
Revenue recognition | Revenue recognition The Company derives its revenue through three broad revenue streams: 1) System Design and Build (SDB), 2) Software, and 3) Training and Consulting services. We recognize revenue from SDB and software contracts mainly through the Performance Improvement Solutions segment and the training and consulting service contracts through both the Performance Improvement Solutions segment and Nuclear Industry Training and Consulting segment. The SDB contracts are typically fixed-price and consist of initial design, engineering, assembly and installation of training simulators which include hardware, software, labor, and post contract support (PCS) on the software. We generally have two main performance obligations for an SDB contract: the training simulator build and PCS. The training simulator build performance obligation generally includes hardware, software, and labor. The transaction price under the SDB contracts is allocated to each performance obligation based on its standalone selling price. We recognize the training simulator build revenue over the construction and installation period using the cost-to-cost input method as our performance creates or enhances assets with no alternative use to the Company, and we have an enforceable right to payment for performance completed to date. Cost-to-cost input method best measures the progress toward complete satisfaction of the performance obligation. PCS revenue is recognized ratably over the service period, as PCS is deemed a stand-ready obligation. In applying the cost-to-cost input method, we use the actual costs incurred to date relative to the total estimated costs to measure the work progress toward the completion of the performance obligation and recognize revenue accordingly. Estimated contract costs are reviewed and revised periodically as the work progresses, and the cumulative effect of any change in estimates is recognized in the period in which the change is identified. Estimated losses are recognized in the period such losses are identified. Uncertainties inherent in the performance of contracts include labor availability and productivity, material costs, change order scope and pricing, software modification and customer acceptance issues. The reliability of these cost estimates is critical to the Company’s revenue recognition as a significant change in the estimates can cause the Company’s revenue and related margins to change significantly from the amounts estimated in the early stages of the project. The SDB contracts generally on the systems. The base warranty will not be accounted for as a separate performance obligation under the contract because it does not provide the customer with a service in addition to the assurance evaluated on a case by case basis to determine if it provides more than just assurance that the product operates as intended, which requires carve-out as a separate performance obligation. Revenue from the sale of perpetual standalone and term software licenses, which do not require significant modification or customization, is recognized upon its delivery to the customer. Revenue from the sale of cloud based subscription applications is recognized ratably over the subscription period following delivery to the customer. Delivery is considered to have occurred when the customer receives access to the software or the cloud based application. A software license sale contract with multiple deliverables typically includes the following elements: license, installation and training services, and PCS. The total transaction price of a software license sale contract is typically fixed, and is allocated to the identified performance obligations based on their relative standalone selling prices. Revenue is recognized as the performance obligations are satisfied. Specifically, license revenue is recognized when the software license is delivered to the customer; installation and training revenue is recognized when the installation and training is completed without regard to a detailed evaluation of the point in time criteria due to the short-term nature of the installation and training services (one to two days on average); and PCS revenue is recognized ratably over the service period, as PCS is deemed as a stand-ready obligation. The contracts within the training and consulting services revenue stream are either time and materials (T&M) based or fixed-price based. Under a typical T&M contract, the Company is compensated based on the number of hours of approved time provided by temporary workers and the bill rates which are fixed by type of work, as well as approved expenses incurred. The customers are billed on a regular basis, such as weekly, biweekly or monthly. In accordance with ASC 606-10-55-18, Revenue from contracts with customers For contracts with multiple performance obligations, we allocate the contract price to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the prices charged to customers. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents represent cash and highly liquid investments including money market accounts with maturities of three months or less at the date of purchase. |
Contract receivables, net | Contract receivables, net Contract receivables include recoverable costs and accrued profit not billed which represents revenue recognized in excess of amounts billed. Billings in excess of costs and estimated earnings on uncompleted contracts in the accompanying consolidated balance sheets represent advanced billings to clients on contracts in advance of work performed. Generally, such amounts will be earned and recognized over the next twelve months. Billed receivables are recorded at invoiced amounts. The allowance for doubtful accounts is based on historical trends of past due accounts, write-offs, specific identification and review of customer accounts. |
Impairment of long-lived assets | Impairment of long-lived assets Long-lived assets, such as equipment, purchased software, capitalized software development costs, and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized at the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of would be separately presented in the consolidated balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated. |
Development expenditures | Development expenditures Development expenditures incurred to meet customer specifications under contracts are charged to contract costs. Company sponsored development expenditures are either charged to operations as incurred and are included in research and development expenses or are capitalized as software development costs. The amounts incurred for Company sponsored development activities relating to the development of new products and services or the improvement of existing products and services, were approximately $1.1 million and $1.3 million for the years ended December 31, 2019 and 2018, respectively. Of this amount, the Company capitalized approximately $0.4 million for the years ended December 31, 2019 and 2018. |
Equipment, software and leasehold improvements, net | Equipment, software and leasehold improvements, net Equipment and purchased software are recorded at cost and depreciated using the straight-line method with estimated useful lives ranging from three years to ten years. Leasehold improvements are amortized over the life of the lease or the estimated useful life, whichever is shorter, using the straight-line method. Upon sale or retirement, the cost and related depreciation are eliminated from the respective accounts and any resulting gain or loss is included in operations. Maintenance and repairs are charged to expense as incurred. |
Software development costs | Software development costs Certain computer software development costs, including direct labor cost, are capitalized in the accompanying consolidated balance sheets. Capitalization of computer software development costs begins upon the establishment of technological feasibility. Capitalization ceases and amortization of capitalized costs begins when the software product is commercially available for general release to customers. Amortization of capitalized computer software development costs is included in cost of revenue and is determined using the straight-line method over the remaining estimated economic life of the product, typically three years. On an annual basis, or more frequently as conditions indicate, the Company assesses the recovery of the unamortized software development costs by estimating the net undiscounted cash flows expected to be generated by the sale of the product. If the undiscounted cash flows are not sufficient to recover the unamortized software costs the Company will write-down the carrying amount of such asset to its estimated fair value based on the future discounted cash flows. The excess of any unamortized computer software costs over the related fair value is written down and charged to operations. |
Goodwill and intangible assets | Goodwill and intangible assets The Company’s intangible assets include amounts recognized in connection with business acquisitions, including customer relationships, trade names, non-compete agreements and alliance agreements. Intangible assets are initially valued at fair value using generally accepted valuation methods appropriate for the type of intangible asset. Amortization is recognized on a straight-line basis over the estimated useful life of the intangible assets, except for contract backlog and contractual customer relations, which are recognized in proportion to the related project revenue streams. Intangible assets with definite lives are reviewed for impairment if indicators of impairment arise. The Company does not have any intangible assets with indefinite useful lives. Goodwill represents the excess of costs over fair value of assets of businesses acquired. The Company reviews goodwill for impairment annually as of December 31 and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable in accordance with Accounting Standards Update (“ASU”) 2011-08, Intangibles - Goodwill and Other (Topic 350): Testing Goodwill for Impairment ASU 2011-08 permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. Under ASU 2011-08, an entity is not required to perform step one of the goodwill impairment test for a reporting unit if it is more likely than not that its fair value is greater than its carrying amount. On February 15, 2019, we acquired DP Engineering (as described in Note 4) and preliminarily recorded goodwill and identified intangible assets as part of the acquisition. On February 23, 2019, an unexpected event occurred at one of DP Engineering’s significant customers and all pending work for that customer was suspended pending a root cause analysis on February 28, 2019. On May 10, 2019, the Company determined that a material impairment had occurred, requiring an assessment for impairment to be completed related to $5.8 million of goodwill recorded in the acquisition. See Note 7. For the annual goodwill impairment test as of December 31, 2019, the Company performed a quantitative step 1 goodwill impairment analysis and have concluded that the estimated fair values of each of the reporting units exceeded their respective carrying values. No further goodwill impairment was recorded during 2019. At December 31, 2018 |
Foreign currency translation | Foreign currency translation The United States Dollar (“USD”) is the functional currency of GSE and our subsidiaries operating in the United States. Our subsidiaries’ financial statements are maintained in their functional currencies. The functional currency of each of our foreign subsidiaries is the currency of the economic environment in which the subsidiary primarily does business. Our foreign subsidiaries’ financial statements are translated into USD using the exchange rates applicable to the dates of the financial statements. Assets and liabilities are translated into USD using the period-end spot foreign exchange rates. Income and expenses are translated at the average exchange rate for the year. Equity accounts are translated at historical exchange rates. The effects of these translation adjustments are cumulative translation adjustments, which are reported as a component of accumulated other comprehensive income (loss) included in the consolidated statements of changes in stockholders’ equity. For any business transaction that is in a currency different from the entity’s functional currency, we record a gain or loss based on the difference between the exchange rate at the transaction date and the exchange rate at the transaction settlement date (or rate at period end, if unsettled) to foreign currency realized gain (loss) account, net gain (loss) on derivative instruments in the consolidated statements of operations. |
Income taxes | Income taxes Income taxes are provided under the asset and liability method. Under this method, deferred income taxes are determined based on the differences between the consolidated financial statements and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized. A provision is made for the Company’s current liability for federal, state and foreign income taxes and the change in the Company’s deferred income tax assets and liabilities. We establish accruals for uncertain tax positions taken or expected to be taken in a tax return when it is not more likely than not (i.e., a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities that have full knowledge of all relevant information. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. Favorable or unfavorable adjustment of the accrual for any particular issue would be recognized as an increase or decrease to income tax expense in the period of a change in facts and circumstances. Interest and penalties related to income taxes are accounted for as income tax expense. |
Stock-based compensation | Stock-based compensation Share-based compensation expense is based on the grant-date fair value estimated in accordance with the provisions of ASC 718, Compensation-Stock Compensation |
Significant customers and concentration of credit risk | Significant customers and concentration of credit risk For the year ended December 31, 2019, we have a concentration of revenue from one individual customer, which accounted for 27.8% of our consolidated revenue. For the year ended December 31, 2018, we have a concentration of revenue from two customers, which accounted for 14.3% and 26.9% of our consolidated revenue, respectively. These customers are part of both Performance and NITC segments. No other individual customer accounted for more than 10% of our consolidated revenue in 2019 or 2018. As of December 31, 2019, we have two customers that accounted for 10.3% and 12.6% of the Company’s consolidated contract receivables. As of December 31, 2018, the Company had one customer that accounted for 16.8% of the Company’s consolidated contract receivables. No other individual customer accounted for more than 10% of our consolidated revenue in 2019 or 2018. |
Fair values of financial instruments | Fair values of financial instruments The carrying amounts of current assets and current liabilities reported in the consolidated balance sheets approximate fair value due to their short term duration. |
Derivative instruments | Derivative instruments The Company utilizes forward foreign currency exchange contracts to manage market risks associated with the fluctuations in foreign currency exchange rates. It is the Company’s policy to use such derivative financial instruments to protect against market risk arising in the normal course of business in order to reduce the impact of these exposures. The Company minimizes credit exposure by limiting counterparties to nationally recognized financial institutions. |
Earnings per share | Earnings per share Basic loss per share is computed by dividing our net loss available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted loss per share is computed by dividing our net loss available to common shareholders by the diluted weighted average number of shares of common stock during the period. Since we experienced a net loss for all periods presented, basic and diluted net loss per share are the same. As such, diluted loss per share for the years ended December 31, 2019 and 2018 excludes the impact of potentially dilutive common shares since those shares would have an anti-dilutive effect on loss per share. The number of common shares and common share equivalents used in the determination of basic and diluted (loss) earnings per share were as follows: (in thousands, except for per share data) Years ended December 31, 2019 2018 Numerator: Net (loss) income attributed to common stockholders $ (12,085 ) $ (354 ) Denominator: Weighted-average shares outstanding for basic earnings per share 20,062,021 19,704,999 Effect of dilutive securities: Employee stock options and warrants - - Adjusted weighted-average shares outstanding and assumed conversions for diluted earnings per share 20,062,021 19,704,999 Shares related to dilutive securities excluded because inclusion would be anti-dilutive 314,234 217,152 Conversion of certain outstanding stock options was not assumed for the years ended December 31, 2019 and 2018 because the impact would have been anti-dilutive. |
Going Concern Consideration | Going Concern Consideration We are in compliance with the amended financial covenants contained in our debt agreement with Citizen’s Bank at December 31, 2019 and in April 2020 entered into an amendment, which removes certain covenants through March 31, 2021. We are experiencing, as a result of the COVID-19 pandemic a negative impact on our financial position and results of operations. We have, and are likely to continue to experience loss or delayed orders, disruption of business as a result of worker illness or mandated shutdowns, and this could impact our ability to maintain compliance with loan covenants, our ability to refinance existing indebtedness, and access to new capital. As part of our certification for the Paycheck Protection Program ("PPP") we indicated without these funds, the risk of employee terminations, layoffs and other drastic cost reductions exists. While the PPP funds will provide sufficient liquidity for the Company these funds will not prevent us from potentially not meeting the minimum EBITDA covenants and potentially not meeting the leverage ratio covenants in the future. Including the proceeds from our PPP loan, we believe we have sufficient cash to meet our operating requirement needs for at least the next twelve months, however since some of our loan covenants are related to operating performance, and our operating performance is being significantly impacted by COVID-19 we believe it is probable we will not meet our debt covenants requirement during all of 2020. If our debt becomes due and payable as a result of a covenant violation, it calls into question our ability to continue as a going concern. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Recent Accounting Pronouncements [Abstract] | |
Accounting pronouncements recently adopted | Accounting pronouncements recently adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2016-02, Leases (Topic 842), The Company adopted the new standard using the modified retrospective approach effective on January 1, 2019. The Company’s adoption included lease codification improvements that were issued by the FASB through June 2019. The FASB made available several practical expedients in adopting the new lease accounting guidance. The Company elected the package of practical expedients permitted under the transition guidance within the amended guidance, which among other things, allowed registrants to carry forward historical lease classification. The Company elected the practical expedient that allows the combination of both lease and non-lease components as a single component and account for it as a lease for all classes of underlying assets. The Company elected not to apply the new guidance to short term leases with an initial term of twelve months or less. The Company recognizes those lease payments in the consolidated statements of operations on a straight-line basis over the lease term. The Company elected to use a single discount rate for a portfolio of leases with reasonably similar characteristics. The most significant impact was the recognition of ROU assets and related lease liabilities for operating leases on the consolidated balance sheets. The Company recognized ROU assets and related lease liabilities of $2.7 million and $3.0 million respectively, related to operating lease commitments, as of January 1, 2019. The operating lease ROU asset represents the lease liability, plus any lease payments made at or before the commencement date, less any lease incentives received. The new guidance did not have a material impact on the Company’s cash flows or results of operations. See Note 18 of the consolidated financial statements. |
Accounting pronouncements not yet adopted | Accounting pronouncements not yet adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies [Abstract] | |
Earnings (Loss) Per Share, Basic and Diluted | The number of common shares and common share equivalents used in the determination of basic and diluted (loss) earnings per share were as follows: (in thousands, except for per share data) Years ended December 31, 2019 2018 Numerator: Net (loss) income attributed to common stockholders $ (12,085 ) $ (354 ) Denominator: Weighted-average shares outstanding for basic earnings per share 20,062,021 19,704,999 Effect of dilutive securities: Employee stock options and warrants - - Adjusted weighted-average shares outstanding and assumed conversions for diluted earnings per share 20,062,021 19,704,999 Shares related to dilutive securities excluded because inclusion would be anti-dilutive 314,234 217,152 |
Revision and Immaterial Corre_2
Revision and Immaterial Correction of an Error in Previously Issued Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revision and Immaterial Correction of an Error in Previously Issued Financial Statements [Abstract] | |
Effect of Error Correction | The effect of the immaterial correction of an error on our previously filed unaudited consolidated financial statements as of and for the three months ended March 31, 2019 is as follows: Consolidated balance sheets (in thousands) Three months ended March 31, 2019 As reported Adjustment As revised Goodwill $ 16,709 $ (3,370 ) $ 13,339 Intangible assets, net 8,999 3,309 12,308 Total assets $ 71,424 $ (61 ) $ 71,363 Accumulated deficit (46,805 ) (61 ) (46,866 ) Total liabilities and stockholders' equity $ 71,424 $ (61 ) $ 71,363 Consolidated statement of operations Three months ended March 31, 2019 As reported Adjustment As revised Amortization of definite-lived intangible assets $ 509 $ 61 $ 570 Loss before income taxes (6,084 ) (61 ) (6,145 ) Net loss $ (4,236 ) $ (61 ) $ (4,297 ) Basic loss per common share $ (0.21 ) $ (0.01 ) $ (0.22 ) Diluted loss per common share $ (0.21 ) $ (0.01 ) $ (0.22 ) Consolidated statement of stockholders' equity Three months ended March 31, 2019 As reported Adjustment As revised Net loss $ (4,236 ) $ (61 ) $ (4,297 ) The effect of the immaterial correction of an error on our previously filed unaudited consolidated financial statements as of and for the six months ended June 30, 2019 is as follows: Consolidated balance sheets (in thousands) Six months ended June 30, 2019 As reported Adjustment As revised Goodwill $ 16,709 $ (3,370 ) $ 13,339 Intangible assets, net 8,454 3,218 11,672 Total assets $ 68,996 $ (152 ) $ 68,844 Accumulated deficit $ (46,930 ) $ (152 ) $ (47,082 ) Total liabilities and stockholders' equity $ 68,996 $ (152 ) $ 68,844 Consolidated statement of operations Six months ended June 30, 2019 As reported Adjustment As revised Amortization of definite-lived intangible assets $ 1,056 $ 152 $ 1,208 Loss before income taxes (5,803 ) (152 ) (5,955 ) Net loss $ (4,361 ) $ (152 ) $ (4,513 ) Basic loss per common share $ (0.22 ) $ (0.01 ) $ (0.23 ) Diluted loss per common share $ (0.22 ) $ (0.01 ) $ (0.23 ) Consolidated statement of stockholders’ equity Six months ended June 30, 2019 As reported Adjustment As revised Net loss $ (4,361 ) $ (152 ) $ (4,513 ) The effect of the immaterial correction of an error on our previously filed unaudited consolidated financial statements as of and for the nine months ended September 30, 2019 is as follows: Consolidated balance sheets (in thousands) Nine months ended September 30, 2019 As reported Adjustment As revised Goodwill $ 16,709 $ (3,370 ) $ 13,339 Intangible assets, net 7,960 3,116 11,076 Total assets $ 63,859 $ (254 ) $ 63,605 Accumulated deficit $ (48,050 ) $ (254 ) $ (48,304 ) Total liabilities and stockholders' equity $ 63,859 $ (254 ) $ 63,605 Consolidated statement of operations Nine months ended September 30, 2019 As reported Adjustment As revised Amortization of definite-lived intangible assets $ 1,550 $ 254 $ 1,804 Loss before income taxes (6,356 ) (254 ) (6,610 ) Net loss $ (5,482 ) $ (254 ) $ (5,736 ) Basic loss per common share $ (0.27 ) $ (0.01 ) $ (0.28 ) Diluted loss per common share $ (0.27 ) $ (0.01 ) $ (0.28 ) Consolidated statement of stockholders' equity Nine months ended September 30, 2019 As reported Adjustment As revised Net loss $ (5,482 ) $ (254 ) $ (5,736 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Acquisition [Abstract] | |
Business Acquisition, Pro Forma Information | The unaudited pro forma financial information in the table below summarizes the combined results of operations for GSE, True North and DP Engineering as if the business combinations had occurred on January 1, 2018, in thousands. Years ended December 31, 2019 2018 Revenue $ 85,959 $ 120,373 Net loss (4,805 ) (274 ) |
DP Engineering Ltd, CO. [Member] | |
Business Acquisition [Abstract] | |
Adjusted Purchase Price Consideration and Fair Value Adjustments | The following table summarizes the calculation of adjusted purchase price as of the acquisition date (in thousands): Base purchase price per agreement $ 13,500 Pre closing working capital adjustment 155 Fair value of contingent consideration 1,200 Total purchase price $ 14,855 |
Consideration Paid For Assets Acquired and Liabilities Assumed | The following table summarizes the consideration paid to acquire DP Engineering and the fair value of the assets acquired and liabilities assumed at the date of the transaction. The following amounts except for cash are all reflected in the consolidated statement of cash flows within the “Acquisition of DP Engineering, net of cash acquired” line caption. ( in thousands Total purchase price $ 14,855 Purchase price allocation: Cash 134 Contract receivables 2,934 Prepaid expenses and other current assets 209 Property, and equipment, net 98 Intangible assets 6,798 Other assets 1,806 Accounts payable and accrued expenses (1,396 ) Other liabilities (1,494 ) Total identifiable net assets 9,089 Goodwill 5,766 Net assets acquired $ 14,855 |
Fair Value of Intangible Assets Acquired and Related Weighted Average Amortization Period | The following table summarizes the fair value of intangible assets acquired at the date of acquisition and the related weighted average amortization period: Intangible Assets Weighted average amortization period Fair Value (in years) (in thousands) Customer relationships 15 $ 4,898 Tradename 10 1,172 Non-compete agreements 5 728 Total $ 6,798 |
True North Consulting, LLC [Member] | |
Business Acquisition [Abstract] | |
Consideration Paid For Assets Acquired and Liabilities Assumed | The following table summarizes the consideration paid to acquire True North and the fair value of the assets acquired and liabilities assumed at the date of the transaction. As of December 31, 2019, the Company had finalized the determination of the fair value allocated to various assets and liabilities. ( in thousands Total purchase price $ 9,915 Purchase price allocation: Cash 306 Contract receivables 1,870 Prepaid expenses and other current assets 8 Property, and equipment, net 1 Intangible assets 5,088 Accounts payable, accrued expenses (1,744 ) Accrued compensation (353 ) Total identifiable net assets 5,176 Goodwill 4,739 Net assets acquired $ 9,915 |
Fair Value of Intangible Assets Acquired and Related Weighted Average Amortization Period | The following table summarizes the fair value of intangible assets acquired at the date of acquisition and the related weighted average amortization period: Intangible Assets Weighted Average Amortization Period Fair Value (in years) (in thousands) Customer relationships 15 $ 3,758 Tradename 10 582 Alliance agreements 5 527 Non-compete agreements 4 221 Total $ 5,088 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue [Abstract] | |
Disaggregation of Revenue | The following table represents a disaggregation of revenue by type of goods or services for the years ended December 31, 2019 and 2018, along with the reportable segment for each category: ( in thousands Twelve Months Ended December 31, 2019 2018 Performance Improvement Solutions segment System Design and Build $ 19,574 $ 25,948 Software 2,883 2,883 Training and Consulting Services 23,320 14,123 Nuclear Industry Training and Consulting segment Training and Consulting Services 37,199 49,295 Total revenue $ 82,975 $ 92,249 |
Balance of Contract Liabilities and Revenue Recognized in Reporting Period | The following table reflects the balance of contract liabilities and the revenue recognized in the reporting period that was included in the contract liabilities from contracts with customers: ( in thousands December 31, 2019 December 31, 2018 Billings in excess of revenue earned (BIE) $ 7,613 $ 10,609 Revenue recognized in the period from amounts included in BIE at the beginning of the period $ 9,089 11,275 |
Restructuring Expenses (Tables)
Restructuring Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring Expenses [Abstract] | |
Abandoned Square Footage and Right Out use Asset | The following table shows the abandoned square footage and right of use asset details: Sykesville DP Engineering Total Square Ft in use December 1, 2019 36,549 19,871 56,420 Square Ft in use December 31, 2019 14,636 9,936 24,572 Abandoned Square Ft 21,913 9,936 31,849 (in thousands) Pre-Abandonment ROU Balance $ 1,474 $ 1,291 $ 2,765 Post-Abandonment Balance 590 646 1,236 Abandonment ROU 884 646 1,529 |
Restructuring Costs | The following table shows the total restructuring costs: Total Expected Restructuring Costs Total 2019 Restructuring Costs Restructuring Costs Lease Abandonment $ 1,529 $ 1,529 Lease Abandonment costs 57 57 Lease termination costs 39 39 International Restructuring 106 106 Employee termination benefits 747 747 Total $ 2,478 $ 2,478 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets [Abstract] | |
Schedule of Acquired Finite-Lived Intangible Assets by Major Class | The following table shows the gross carrying amount and accumulated amortization of definite-lived intangible assets: (in thousands) As of December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Amortized intangible assets Customer relationships $ 11,730 $ (4,079 ) $ 7,651 Trade names 2,467 (727 ) 1,740 Developed technology 471 (471 ) - Non-contractual customer relationships 433 (433 ) - Noncompete agreement 949 (217 ) 732 Alliance agreement 527 (171 ) 356 Others 167 (167 ) - Total $ 16,744 $ (6,265 ) $ 10,479 (in thousands) As of December 31, 2018 Gross Carrying Amount Accumulated Amortization Net Amortized intangible assets Customer relationships $ 6,831 $ (2,375 ) $ 4,456 Trade names 1,295 (318 ) 977 Developed technology 471 (471 ) - Non-contractual customer relationships 433 (433 ) - Noncompete agreement 221 (35 ) 186 Alliance agreement 527 (66 ) 461 Noncompete agreement 167 (167 ) - Total $ 9,945 $ (3,865 ) $ 6,080 |
Finite-Lived Intangible Assets, Future Amortization Expense | Amortization expense related to definite-lived intangible assets totaled $2.4 million and 1.6 million for the years ended December 31, 2019 and 2018, respectively. The following table shows the estimated amortization expense of the definite-lived intangible assets for the next five years: (in thousands) Years ended December 31: 2020 $ 2,808 2021 2,143 2022 1,626 2023 1,199 Thereafter 2,703 $ 10,479 |
Change in Net Carrying Amount of Goodwill | The change in the net carrying amount of goodwill from January 1, 2018 through December 31, 2019 was comprised of the following items: (in thousands) Performance Improvement Solutions Nuclear Industry Training and Consulting Total Net book value at January 1, 2018 $ - $ 8,431 $ 8,431 Acquisition 4,739 - 4,739 Dispositions - - - Goodwill impairment loss - - - Net book value at December 31, 2018 $ 4,739 $ 8,431 $ 13,170 Acquisition 5,766 - 5,766 Dispositions - - - Goodwill impairment loss (5,597 ) - (5,597 ) Net book value at December 31, 2019 $ 4,908 $ 8,431 $ 13,339 |
Contract Receivables (Tables)
Contract Receivables (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Contract Receivables [Abstract] | |
Contract Receivables | Recoverable costs and accrued profit not billed represent costs incurred and associated profit accrued on contracts that will become billable upon future milestones or completion of contracts. The components of contract receivables are as follows: (in thousands) December 31, 2019 2018 Billed receivables $ 11,041 $ 15,998 Unbilled receivables 6,624 5,506 Allowance for doubtful accounts (458 ) (427 ) Total contract receivables, net $ 17,207 $ 21,077 |
Allowance For Doubtful Account Rollforward | The activity in the allowance for doubtful accounts is as follows: (in thousands) As of and for the Years ended December 31, 2019 2018 Beginning balance $ 427 $ 137 Current year provision 31 294 Current year write-offs - - Currency adjustment - (4 ) Ending balance $ 458 $ 427 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Prepaid Expenses and Other Current Assets [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following: (in thousands) December 31, 2019 2018 Inventory $ - $ 139 Income tax receivable 237 310 Prepaid expenses 861 556 Other current assets 782 795 Total $ 1,880 $ 1,800 |
Equipment, Software, and Leas_2
Equipment, Software, and Leasehold Improvements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equipment, Software and Leasehold Improvements [Abstract] | |
Equipment, Software and Leasehold Improvements | Equipment, software and leasehold improvements, net consist of the following: (in thousands) December 31, 2019 2018 Computer and equipment $ 2,266 $ 2,178 Software 1,693 1,682 Leasehold improvements 664 619 Furniture and fixtures 900 814 5,523 5,293 Accumulated depreciation (4,584 ) (4,228 ) Equipment, software and leasehold improvements, net $ 939 $ 1,065 |
Product Warranty (Tables)
Product Warranty (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Warranty [Abstract] | |
Activities in the Accrued Warranty Accounts | The activity in the accrued warranty accounts is as follows: (in thousands) As of and for the years ended December 31, 2019 2018 Beginning balance $ 1,621 $ 1,953 Current year provision (133 ) (107 ) Current year claims (164 ) (215 ) Currency adjustment (1 ) (10 ) Ending balance $ 1,323 $ 1,621 |
Activity in Warranty Accounts | The current and non-current warranty balance is as follows: Years ended December 31, 2019 2018 Current $ 921 $ 981 Non-current 402 640 Total Warranty $ 1,323 $ 1,621 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value of Financial Instruments [Abstract] | |
Assets and Liabilities Measured at Fair Value | The following table presents assets and liabilities measured at fair value at December 31, 2019: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) (Level 1) (Level 2) (Level 3) Total Money market funds $ 434 $ - $ - $ 434 Foreign exchange contracts - 49 - 49 Total assets $ 434 $ 49 $ - $ 483 Liability awards - (9 ) - (9 ) Interest rate swap contract - (160 ) - (160 ) Total liabilities $ - $ (169 ) $ - $ (169 ) The following table presents assets and liabilities measured at fair value at December 31, 2018: Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs (in thousands) (Level 1) (Level 2) (Level 3) Total Money market funds $ 824 $ - $ - $ 824 Foreign exchange contracts - 43 - 43 Total assets $ 824 $ 43 $ - $ 867 Liability awards $ - $ (118 ) $ - $ (118 ) Interest rate swap contract - (103 ) - (103 ) Total liabilities $ - $ (221 ) $ - $ (221 ) |
Roll-Forward of the Fair Value of the Contingent Consideration | The following table provides a roll-forward of the fair value of the contingent consideration categorized as Level 3 for the year ended December 31, 2019: (in thousands) Balance, January 1, 2019 $ - Issuance of contingent consideration in connection with acquisitions 1,200 Change in fair value (1,200 ) Balance, December 31, 2019 $ - |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt [Abstract] | |
Outstanding Long-term Debt | At December 31, 2019, the outstanding debt under the delayed draw term loan facility was as follows: Long-term debt, net of discount $ 18,481 Less: current portion of long-term debt 18,481 Long-term debt, less current portion $ - |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments [Abstract] | |
Estimated Fair Value of the Contracts in the Consolidated Balance Sheets | The Company reports all derivatives at fair value. These contracts are recognized as either assets or liabilities, depending upon the derivative’s fair value. The estimated net fair values of the derivative contracts on the consolidated balance sheets are as follows: December 31, (in thousands) 2019 2018 Asset derivatives Prepaid expenses and other current assets $ 49 $ 43 49 43 Liability derivatives Other liabilities (160 ) (103 ) (160 ) (103 ) Net fair value $ (111 ) $ (60 ) |
Net (Loss) Gain on Derivative Instruments | For the years ended December 31, 2019 and 2018, the Company recognized a net (loss) gain on its derivative instruments as outlined below: Years ended December 31, (in thousands) 2019 2018 Foreign exchange contracts- change in fair value $ 6 $ (150 ) Interest rate swap - change in fair value (57 ) (103 ) Remeasurement of related contract receivables and billings in excess of revenue earned 38 (97 ) $ (13 ) $ (350 ) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes [Abstract] | |
Income Before Income Taxes by Domestic and Foreign Sources | The consolidated income before income taxes, by domestic and foreign sources, is as follows: (in thousands) Years ended December 31, 2019 2018 Domestic $ (6,671 ) $ 2,512 Foreign 319 (1,735 ) Total $ (6,352 ) $ 777 |
Provision for Income Taxes | The provision for income taxes is as follows: (in thousands) Years ended December 31, 2019 2018 Current: Federal $ (30 ) $ (6 ) State 60 259 Foreign 354 234 Subtotal 384 487 Deferred: Federal 4,686 600 State 663 67 Foreign - (23 ) Subtotal 5,349 644 Total $ 5,733 $ 1,131 |
Effective Income Tax Rate Reconciliation | The effective income tax rate for the years ended December 31, 2019 and 2018 differed from the statutory federal income tax rate as presented below: Effective Tax Rate percentage (%) Years ended December 31, 2019 2018 Statutory federal income tax rate 21.0 % 21.0 % State income taxes, net of federal tax benefit (12.1 )% 30.1 % Effect of foreign operations (0.3 )% (2.1 )% Change in valuation allowance (93.1 )% (43.6 )% Meals and Entertainment (1.4 )% 10.0 % Stock based compensation (1.4 )% (6.9 )% Other permanent differences (0.6 )% 0.4 % Uncertain Tax Positions 0.9 % 46.3 % Change in tax rate 0.0 % (2.8 )% Expired stock options 0.0 % 50.7 % Change in APB 23 0.0 % (4.4 )% Prior year reconciling items (3.3 )% (2.4 )% Expiration of capital Loss 0.0 % 49.3 % Effective tax rate (90.3 )% 145.6 % |
Deferred Tax Assets and Liabilities | Deferred income taxes arise from temporary differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements. A summary of the tax effect of the significant components of the deferred income tax assets and liabilities is as follows: (in thousands) As of December 31, 2019 2018 Deferred tax assets: Net operating loss carryforwards $ 4,396 $ 4,074 Accruals 247 760 Reserves 408 479 Alternative minimum tax credit carryforwards 126 213 Stock-based compensation expense 539 563 Intangible assets 1,021 674 Goodwill 1,037 - Operating lease liabilities 998 - Other 464 324 Total deferred tax assets 9,236 7,087 Valuation allowance (7,576 ) (756 ) Total deferred tax assets less valuation allowance 1,660 6,331 Deferred tax liabilities: Undistributed earnings of foreign subsidiary - (103 ) Software development costs (161 ) (163 ) Fixed assets (7 ) (44 ) Intangible assets (22 ) - Indefinite-lived intangibles (728 ) (525 ) Operating lease - right of use assets (510 ) - Other (175 ) (138 ) Total deferred tax liabilities (1,603 ) (973 ) Net deferred tax assets $ 57 $ 5,358 |
Uncertain Tax Liabilities | Uncertain Tax Positions During 2019 and 2018, the Company recorded tax liabilities for certain foreign tax contingencies. The Company recorded these uncertain tax positions in other current liabilities on the consolidated balance sheets. During 2018, the Company recorded a tax liability for an uncertain tax position related to revenue recognition in the US. The uncertain tax position is recorded as a component of current and deferred liability. An accounting method change was filed with the 2018 tax return, accordingly, the uncertain tax position related to revenue recognition has been reversed in 2019. The following table outlines the Company’s uncertain tax liabilities, including accrued interest and penalties for each jurisdiction: China Ukraine South Korea U.S. (in thousands) Tax Interest and Penalties Tax Interest and Penalties Tax Interest and Penalties Tax Interest and Penalties Total Balance, January 1, 2018 $ 216 $ 262 $ 100 $ 28 $ 341 $ 45 $ 833 - $ 1,825 Increases - 23 - 44 120 66 163 4 420 Decreases 12 - 18 - - - - - 30 Balance, December 31, 2018 $ 204 $ 285 $ 82 $ 72 $ 461 $ 111 $ 996 $ 4 $ 2,215 Increases - 33 - - 93 67 - 2 195 Decreases 3 - 4 12 - - 203 - 222 Balance, December 31, 2019 $ 201 $ 318 $ 78 $ 60 $ 554 $ 178 $ 793 $ 6 $ 2,188 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation [Abstract] | |
Stock Option Activity | Information with respect to stock option activity as of and for the year ended December 31, 2019 is as follows: Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value (in thousands) Weighted Average Remaining Contractual Life (Years) Options outstanding at January 1, 2019 55,000 $ 1.87 Options granted - - Options exercised (50,000 ) 1.89 Options forfeited - - Options outstanding at December 31, 2019 5,000 1.65 $ - 0.87 Options expected to vest - - $ - - Options exercisable at December 31, 2019 5,000 $ - $ - - Information with respect to stock option activity as of and for the year ended December 31, 2018 is as follows: Number of Shares Weighted Average Exercise Price Aggregate Intrinsic Value (in thousands) Weighted Average Remaining Contractual Life (Years) Options outstanding at January 1, 2018 1,046,833 $ 3.33 Options granted - - Options exercised (486,500 ) 1.88 Options forfeited (505,333 ) 4.89 Options outstanding at December 31, 2018 55,000 1.87 $ 17 2.08 Options expected to vest - - $ - - Options exercisable at December 31, 2018 55,000 $ - $ - - |
Restricted Stock Units | During the years ended December 31, 2019 and 2018, the Company issued RSUs to employees which vest upon the achievement of specific market-based or time-based measures. The fair value for RSU’s is calculated based on the stock price on the grant date and expensed ratably over the requisite service period, which ranges between one year and five years. The following table summarizes the information about vested and unvested restricted stock units for the years ended December 31, 2019 and 2018. Number of Shares Weighted Average Fair Value Nonvested RSUs at January 1, 2018 1,634,663 $ 1.96 RSUs granted 428,526 3.23 RSUs forfeited (140,997 ) 2.47 RSUs vested (350,667 ) 3.30 Nonvested RSUs at December 31, 2018 1,571,525 $ 1.96 Nonvested RSUs at January 1, 2019 1,571,525 $ 1.96 RSUs granted 918,459 2.56 RSUs forfeited (64,172 ) 3.12 RSUs vested (452,087 ) 3.30 Nonvested RSUs at December 31, 2019 1,973,725 $ 1.49 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Classification of Operating ROU Assets and Lease Liabilities on the Balance Sheet | Lease contracts are evaluated at inception to determine whether they contain a lease, where the Company obtains the right to control an identified asset. The following table summarizes the classification of operating ROU assets and lease liabilities on the consolidated balance sheets (in thousands): Operating Leases Classification December 31, 2019 Leased Assets Operating lease - right of use assets Long term assets $ 2,215 Lease Liabilities Operating lease liabilities - Current Other current liabilities 1,153 Operating lease liabilities Long term liabilities 3,000 $ 4,153 |
Lease Income and Expenses | The table below summarizes the lease income and expenses recorded in the consolidated statements of operations incurred year to date ended December 31, 2019 , ( in thousands Lease Cost Classification Twelve months ended December 31, 2019 Operating lease cost (1) Selling, general and administrative expenses $ 1,112 Short-term leases costs (2) Selling, general and administrative expenses 121 Sublease income (3) Selling, general and administrative expenses (107 ) Net lease cost $ 1,126 (1) (2) (3) |
Future Minimum Lease Payments | The Company is obligated under certain noncancelable operating leases for office facilities and equipment. Future minimum lease payments under noncancelable operating leases as of December 31, 2019 are as follows: (in thousands) Gross Future Minimum Lease Payments 2020 $ 1,335 2021 1,293 2022 1,184 2023 622 2024 106 Thereafter - Total $ 4,540 Less: Interest 387 Present value of lease payments $ 4,153 |
Operating Lease Weighted Average Remaining Lease Term And Discount Rate | The Company has calculated the weighted-average remaining lease term, presented in years below, and the weighted-average discount rate for our operating leases. As noted in our lease accounting policy, the Company uses the incremental borrowing rate as the lease discount rate: Lease Term and Discount Rate Twelve months ended December 31, 2019 Weighted-average remaining lease term (years) Operating leases 3.51 Weighted-average discount rate Operating leases 5.00% The table below sets out the classification of lease payments in the consolidated statement of cash flows. The ROU assets obtained in exchange for operating lease liabilities represent new operating leases obtained through our business combination during the year to date ended December 31, 2019: (in thousands) Other Information Twelve months ended December 31, 2019 - Operating cash flows used in operating leases $ 1,275 Cash paid for amounts included in measurement of liabilities 1,275 ROU assets obtained in exchange for new operating liabilities $ 1,777 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Information [Abstract] | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following table sets forth the revenue and operating results attributable to each reportable segment and includes a reconciliation of segment revenue to consolidated revenue and operating results to consolidated income before income tax expense (benefit). Inter-segment revenue is eliminated in consolidation and is not significant. (in thousands) Years ended December 31, 2019 2018 Revenue: Performance Improvement Solutions $ 45,776 $ 42,954 Nuclear Industry Training and Consulting 37,199 49,295 $ 82,975 $ 92,249 Depreciation: Performance Improvement Solutions $ 345 $ 385 Nuclear Industry Training and Consulting 18 130 $ 363 $ 515 Amortization of definite-lived intangible assets: Performance Improvement Solutions $ 1,871 $ 898 Nuclear Industry Training and Consulting 529 714 $ 2,400 $ 1,612 Operating (loss) income Performance Improvement Solutions $ (5,802 ) $ 2,640 Nuclear Industry Training and Consulting (1,617 ) (1,274 ) Operating (loss) income $ (7,419 ) $ 1,366 Interest expense (988 ) (268 ) Loss on derivative instruments (13 ) (350 ) Other income (expense), net 2,068 29 Income (loss) before income taxes $ (6,352 ) $ 777 |
Reconciliation of Assets from Segment to Consolidated | Additional information relating to segments is as follows: (in thousands) December 31, 2019 2018 Performance Improvement Solutions $ 41,550 $ 40,353 Nuclear Industry Training and Consulting 16,959 21,087 Total assets $ 58,509 $ 61,440 |
Segment Reporting Information, by Segment | For the years ended December 31, 2019 and 2018, 90% and 91%, respectively, of the Company’s consolidated revenue was from customers in the nuclear power industry. The Company designs, develops and delivers business and technology solutions to the energy industry worldwide. Revenue, operating income (loss) and total assets for the Company’s United States, European, and Asian subsidiaries as of and for the years ended December 31, 2019 and 2018 are as follows: (in thousands) Year ended December 31, 2019 United States Europe Asia Eliminations Consolidated Revenue $ 81,597 $ - $ 1,378 $ - $ 82,975 Transfers between geographic locations 623 - 124 (747 ) - Total revenue $ 82,220 $ - $ 1,502 $ (747 ) $ 82,975 Operating income (loss) $ (7,710 ) $ 54 $ 237 $ - $ (7,419 ) Total assets, at December 31 $ 184,115 $ 3,526 $ 2,805 $ (131,937 ) $ 58,509 (in thousands) Year ended December 31, 2018 United States Europe Asia Eliminations Consolidated Revenue $ 88,979 $ 2,150 $ 1,120 $ - $ 92,249 Transfers between geographic locations 2,046 - 199 (2,245 ) - Total revenue $ 91,025 $ 2,150 $ 1,319 $ (2,245 ) $ 92,249 Operating income (loss) $ 2,902 $ (1,116 ) $ (420 ) $ - $ 1,366 Total assets, at December 31 $ 171,206 $ 3,893 $ 3,592 $ (117,251 ) $ 61,440 |
Supplemental Disclosure of Ca_2
Supplemental Disclosure of Cash Flow Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Supplemental Disclosure of Cash Flow Information [Abstract] | |
Supplemental Disclosure of Cash Flow Information | (in thousands) Year ended December 31, 2019 2018 Cash paid: Interest $ 989 $ 278 Income taxes $ 489 $ 187 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Development Expenditures [Abstract] | ||
Development Expenditures | $ 1,100 | $ 1,300 |
Capitalized software development costs | $ 400 | 400 |
Software Development Costs [Abstract] | ||
Software development costs useful life | 3 years | |
Business Combination, Goodwill [Abstract] | ||
Goodwill acquired | $ 5,766 | 4,739 |
Numerator: [Abstract] | ||
Net (loss) income attributed to common stockholders | $ (12,085) | $ (354) |
Denominator: [Abstract] | ||
Weighted-average shares outstanding for basic earnings per share (in shares) | 20,062,021 | 19,704,999 |
Effect of dilutive securities [Abstract] | ||
Stock options and restricted stock units (in shares) | 0 | 0 |
Adjusted weighted-average shares outstanding and assumed conversions for diluted loss per share (in shares) | 20,062,021 | 19,704,999 |
Shares related to dilutive securities excluded because inclusion would be anti-dilutive (in shares) | 314,234 | 217,152 |
Equipment, Software and Leasehold Improvements, net [Member] | Maximum [Member] | ||
Equipment, Software and Leasehold Improvements [Abstract] | ||
Estimated useful life | 10 years | |
Equipment, Software and Leasehold Improvements, net [Member] | Minimum [Member] | ||
Equipment, Software and Leasehold Improvements [Abstract] | ||
Estimated useful life | 3 years | |
DP Engineering Ltd, CO. [Member] | ||
Business Combination, Goodwill [Abstract] | ||
Goodwill acquired | $ 5,800 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies, Concentration of Credit Risk (Details) - Customer Concentration Risk [Member] - Customer | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue [Member] | ||
Revenue by major customers [Abstract] | ||
Number of major customers | 1 | 2 |
Revenue [Member] | Customer One [Member] | ||
Revenue by major customers [Abstract] | ||
Percentage contributed by major customers | 14.30% | |
Revenue [Member] | Customer Two [Member] | ||
Revenue by major customers [Abstract] | ||
Percentage contributed by major customers | 27.80% | 26.90% |
Contract Receivables [Member] | ||
Revenue by major customers [Abstract] | ||
Percentage contributed by major customers | 16.80% | |
Number of major customers | 2 | 1 |
Contract Receivables [Member] | Customer One [Member] | ||
Revenue by major customers [Abstract] | ||
Percentage contributed by major customers | 10.30% | |
Contract Receivables [Member] | Customer Two [Member] | ||
Revenue by major customers [Abstract] | ||
Percentage contributed by major customers | 12.60% |
Recent Accounting Pronounceme_3
Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accounting Pronouncements Recently Adopted [Abstract] | ||
Right of use assets | $ 2,215 | $ 0 |
Operating lease liability | $ 4,153 | |
ASU 2016-02 [Member] | ||
Accounting Pronouncements Recently Adopted [Abstract] | ||
Right of use assets | 2,700 | |
Operating lease liability | $ 3,000 |
Revision and Immaterial Corre_3
Revision and Immaterial Correction of an Error in Previously Issued Financial Statements (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Error Corrections [Abstract] | |||
Goodwill impairment loss | $ (5,597) | $ 0 | |
Impairment Charge [Member] | |||
Error Corrections [Abstract] | |||
Impairment charges | $ 3,400 | ||
Goodwill impairment loss | $ (2,200) |
Revision and Immaterial Corre_4
Revision and Immaterial Correction of an Error in Previously Issued Financial Statements, Effect of Error Correction on Financial Statements (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Assets | ||||||
Goodwill | $ 13,339 | $ 13,339 | $ 13,339 | $ 13,339 | $ 13,170 | $ 8,431 |
Intangible assets, net | 12,308 | 11,672 | 11,076 | 10,479 | 6,080 | |
Total assets | 71,363 | 68,844 | 63,605 | 58,509 | 61,440 | |
Stockholders' equity: | ||||||
Accumulated deficit | (46,866) | (47,082) | (48,304) | (54,654) | (42,569) | |
Total liabilities and stockholders' equity | 71,363 | 68,844 | 63,605 | 58,509 | 61,440 | |
Operating expenses: | ||||||
Amortization of definite-lived intangible assets | 570 | 1,208 | 1,804 | 2,400 | 1,612 | |
Loss before income taxes | (6,145) | (5,955) | (6,610) | (6,352) | 777 | |
Net loss | $ (4,297) | $ (4,513) | $ (5,736) | $ (12,085) | $ (354) | |
Basic loss per common share | $ (0.22) | $ (0.23) | $ (0.28) | $ (0.60) | $ (0.02) | |
Diluted loss per common share | $ (0.22) | $ (0.23) | $ (0.28) | $ (0.60) | $ (0.02) | |
Consolidated statement of shareholder's equity [Abstract] | ||||||
Net loss | $ (4,297) | $ (4,513) | $ (5,736) | $ (12,085) | $ (354) | |
As Reported [Member] | ||||||
Assets | ||||||
Goodwill | 16,709 | 16,709 | 16,709 | |||
Intangible assets, net | 8,999 | 8,454 | 7,960 | |||
Total assets | 71,424 | 68,996 | 63,859 | |||
Stockholders' equity: | ||||||
Accumulated deficit | (46,805) | (46,930) | (48,050) | |||
Total liabilities and stockholders' equity | 71,424 | 68,996 | 63,859 | |||
Operating expenses: | ||||||
Amortization of definite-lived intangible assets | 509 | 1,056 | 1,550 | |||
Loss before income taxes | (6,084) | (5,803) | (6,356) | |||
Net loss | $ (4,236) | $ (4,361) | $ (5,482) | |||
Basic loss per common share | $ (0.21) | $ (0.22) | $ (0.27) | |||
Diluted loss per common share | $ (0.21) | $ (0.22) | $ (0.27) | |||
Consolidated statement of shareholder's equity [Abstract] | ||||||
Net loss | $ (4,236) | $ (4,361) | $ (5,482) | |||
Adjustment [Member] | ||||||
Assets | ||||||
Goodwill | (3,370) | (3,370) | (3,370) | |||
Intangible assets, net | 3,309 | 3,218 | 3,116 | |||
Total assets | (61) | (152) | (254) | |||
Stockholders' equity: | ||||||
Accumulated deficit | (61) | (152) | (254) | |||
Total liabilities and stockholders' equity | (61) | (152) | (254) | |||
Operating expenses: | ||||||
Amortization of definite-lived intangible assets | 61 | 152 | 254 | |||
Loss before income taxes | (61) | (152) | (254) | |||
Net loss | $ (61) | $ (152) | $ (254) | |||
Basic loss per common share | $ (0.01) | $ (0.01) | $ (0.01) | |||
Diluted loss per common share | $ (0.01) | $ (0.01) | $ (0.01) | |||
Consolidated statement of shareholder's equity [Abstract] | ||||||
Net loss | $ (61) | $ (152) | $ (254) |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Thousands | Feb. 15, 2019 | May 11, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2017 |
Purchase price allocation [Abstract] | ||||||||
Goodwill | $ 13,339 | $ 13,170 | $ 13,339 | $ 13,339 | $ 13,339 | $ 8,431 | ||
Revenues | $ 82,975 | 92,249 | ||||||
True North Consulting, LLC [Member] | ||||||||
Business Acquisition [Abstract] | ||||||||
Business acquisition, effective date of acquisition | May 11, 2018 | |||||||
Business acquisition, name of acquired entity | True North Consulting LLC | |||||||
Percentage of ownership interest acquired | 100.00% | |||||||
Cash consideration in escrow | $ 1,500 | |||||||
Proceeds from issuance of debt | 10,300 | |||||||
Period to satisfy indemnification claims | 18 months | |||||||
Calculation of Adjusted Purchase Price [Abstract] | ||||||||
Base purchase price per agreement | 9,750 | |||||||
Total purchase price | 9,915 | |||||||
Acquisition [Abstract] | ||||||||
Total purchase price | 9,915 | |||||||
Purchase price allocation [Abstract] | ||||||||
Cash | 306 | |||||||
Contract receivables | 1,870 | |||||||
Prepaid expenses and other current assets | 8 | |||||||
Property, and equipment, net | 1 | |||||||
Intangible assets | 5,088 | |||||||
Accounts payable | (1,744) | |||||||
Accrued compensation | (353) | |||||||
Total identifiable net assets | 5,176 | |||||||
Goodwill | 4,739 | |||||||
Net assets acquired | 9,915 | |||||||
Acquired receivable, fair value | 1,870 | |||||||
Revenues | $ 9,848 | 7,986 | ||||||
Transaction costs | $ 540 | |||||||
DP Engineering Ltd, CO. [Member] | ||||||||
Business Acquisition [Abstract] | ||||||||
Business acquisition, effective date of acquisition | Feb. 15, 2019 | |||||||
Business acquisition, name of acquired entity | DP Engineering | |||||||
Percentage of ownership interest acquired | 100.00% | |||||||
Cash consideration in escrow | $ 1,700 | |||||||
Proceeds from issuance of debt | 14,300 | 14,300 | ||||||
Earn-out amount | 5,000 | 2,000 | ||||||
Calculation of Adjusted Purchase Price [Abstract] | ||||||||
Base purchase price per agreement | 13,500 | |||||||
Pre closing working capital adjustment | 155 | |||||||
Fair value of contingent consideration | 1,200 | |||||||
Total purchase price | 14,855 | 13,500 | ||||||
Acquisition [Abstract] | ||||||||
Total purchase price | 14,855 | $ 13,500 | ||||||
Purchase price allocation [Abstract] | ||||||||
Cash | 134 | |||||||
Contract receivables | 2,934 | |||||||
Prepaid expenses and other current assets | 209 | |||||||
Property, and equipment, net | 98 | |||||||
Intangible assets | 6,798 | |||||||
Other assets | 1,806 | |||||||
Accounts payable | (1,396) | |||||||
Other liabilities | (1,494) | |||||||
Total identifiable net assets | 9,089 | |||||||
Goodwill | 5,766 | |||||||
Net assets acquired | 14,855 | |||||||
Acquired receivable, fair value | 2,934 | |||||||
Revenues | $ 8,178 | |||||||
Transaction costs | $ 744 |
Acquisitions, Intangible Assets
Acquisitions, Intangible Assets (Details) - USD ($) $ in Thousands | Feb. 15, 2019 | May 11, 2018 | Dec. 31, 2019 | Dec. 31, 2018 |
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Goodwill impairment loss | $ (5,597) | $ 0 | ||
True North Consulting, LLC [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | $ 5,088 | |||
DP Engineering Ltd, CO. [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | $ 6,798 | 6,798 | ||
Goodwill impairment loss | (5,600) | |||
Indemnification amount | 5,000 | $ 2,000 | ||
Customer Relationships [Member] | True North Consulting, LLC [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | 3,758 | |||
Finite-lived intangible assets, weighted average useful life | 15 years | |||
Customer Relationships [Member] | DP Engineering Ltd, CO. [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | 4,898 | |||
Finite-lived intangible assets, weighted average useful life | 15 years | |||
Tradename [Member] | True North Consulting, LLC [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | 582 | |||
Finite-lived intangible assets, weighted average useful life | 10 years | |||
Tradename [Member] | DP Engineering Ltd, CO. [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | 1,172 | |||
Finite-lived intangible assets, weighted average useful life | 10 years | |||
Alliance Agreements [Member] | True North Consulting, LLC [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | 527 | |||
Finite-lived intangible assets, weighted average useful life | 5 years | |||
Non-compete Agreements [Member] | True North Consulting, LLC [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | $ 221 | |||
Finite-lived intangible assets, weighted average useful life | 4 years | |||
Non-compete Agreements [Member] | DP Engineering Ltd, CO. [Member] | ||||
Acquired Finite-Lived Intangible Assets [Abstract] | ||||
Finite-lived intangible assets acquired | $ 728 | |||
Finite-lived intangible assets, weighted average useful life | 5 years |
Acquisitions, Pro Forma Financi
Acquisitions, Pro Forma Financial Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition, Pro Forma Information [Abstract] | ||
Revenue | $ 85,959 | $ 120,373 |
Net income | $ (4,805) | $ (274) |
Revenue (Details)
Revenue (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)StreamObligation | Dec. 31, 2018USD ($) | |
Disaggregation of Revenue [Abstract] | ||
Revenue | $ 82,975 | $ 92,249 |
Number of broad revenue streams | Stream | 3 | |
Contract with Customer, Asset and Liability [Abstract] | ||
Billings in excess of revenue earned (BIE) | $ 7,613 | 10,609 |
Revenue recognized in the period from amounts included in Billings in Excess at the beginning of the period | 9,089 | 11,275 |
Amount of revenue recognized related to performance obligations satisfied in previous periods | $ 2,482 | |
Revenue, Performance Obligation [Abstract] | ||
Number of performance obligations | Obligation | 2 | |
Remaining performance obligation | $ 28,016 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-12-31 | ||
Revenue, Performance Obligation [Abstract] | ||
Expected period to recognize revenue as performance obligations are satisfied | 12 months | |
Performance Improvement Solutions [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | $ 45,776 | 42,954 |
Performance Improvement Solutions [Member] | System Design and Build [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 19,574 | 25,948 |
Performance Improvement Solutions [Member] | Software [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 2,883 | 2,883 |
Performance Improvement Solutions [Member] | Training and Consulting Services [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 23,320 | 14,123 |
Nuclear Industry Training and Consulting [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | 37,199 | 49,295 |
Nuclear Industry Training and Consulting [Member] | Training and Consulting Services [Member] | ||
Disaggregation of Revenue [Abstract] | ||
Revenue | $ 37,199 | $ 49,295 |
Restructuring Expenses (Details
Restructuring Expenses (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($)ft²PositionEngineerOffice | Dec. 31, 2018USD ($) | Dec. 01, 2019ft² | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related cost, expected number of positions eliminated | Position | 40 | |||
Expected restructuring costs | $ 2,478 | $ 2,200 | ||
Cumulative translation adjustment | 1,300 | |||
Tax benefit | 1,000 | |||
Payments | $ 54 | |||
Reduction in workforce | Engineer | 12 | |||
Number of offices leases terminated | Office | 1 | |||
Lease termination costs | $ 300 | |||
Lease abandonment restructuring charges | $ 1,500 | |||
Abandoned Square Footage and Right Out Use Asset [Abstract] | ||||
Square Ft in use | ft² | 24,572 | 56,420 | ||
Abandoned Square Ft | ft² | 31,849 | |||
Pre-Abandonment ROU Balance | $ 2,765 | |||
Post-Abandonment Balance | 1,236 | |||
Abandonment ROU Balance | 1,529 | |||
Restructuring charges | 2,478 | 1,269 | ||
Restructuring Costs [Abstract] | ||||
Total Expected Restructuring Costs | 2,478 | 2,200 | ||
Restructuring costs | $ 2,478 | $ 1,300 | ||
Sykesville [Member] | ||||
Abandoned Square Footage and Right Out Use Asset [Abstract] | ||||
Square Ft in use | ft² | 14,636 | 36,549 | ||
Abandoned Square Ft | ft² | 21,913 | |||
Pre-Abandonment ROU Balance | $ 1,474 | |||
Post-Abandonment Balance | 590 | |||
Abandonment ROU Balance | 884 | |||
DP Engineering Ltd, Co. [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Lease termination costs | $ 300 | |||
Abandoned Square Footage and Right Out Use Asset [Abstract] | ||||
Square Ft in use | ft² | 9,936 | 19,871 | ||
Abandoned Square Ft | ft² | 9,936 | |||
Pre-Abandonment ROU Balance | $ 1,291 | |||
Post-Abandonment Balance | 646 | |||
Abandonment ROU Balance | 646 | |||
Restructuring charges | 500 | |||
Lease Abandonment [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Expected restructuring costs | 1,529 | |||
Restructuring Costs [Abstract] | ||||
Total Expected Restructuring Costs | 1,529 | |||
Restructuring costs | 1,529 | |||
Lease Abandonment Costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Expected restructuring costs | 57 | |||
Restructuring Costs [Abstract] | ||||
Total Expected Restructuring Costs | 57 | |||
Restructuring costs | 57 | |||
Lease Termination Costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Expected restructuring costs | 39 | |||
Restructuring Costs [Abstract] | ||||
Total Expected Restructuring Costs | 39 | |||
Restructuring costs | 39 | |||
International Restructuring [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Expected restructuring costs | 106 | |||
Restructuring Costs [Abstract] | ||||
Total Expected Restructuring Costs | 106 | |||
Restructuring costs | 106 | |||
Employee Termination Benefits [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Expected restructuring costs | 747 | |||
Restructuring Costs [Abstract] | ||||
Total Expected Restructuring Costs | 747 | |||
Restructuring costs | $ 747 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) $ in Thousands | Feb. 15, 2019USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($)Segment | Dec. 31, 2018USD ($) |
Goodwill and Intangible Assets [Abstract] | ||||||
Number of reporting units | Segment | 2 | |||||
Number of operating segments | Segment | 2 | |||||
Goodwill [Roll Forward] | ||||||
Net book value, beginning balance | $ 13,170 | $ 13,170 | $ 13,170 | $ 13,170 | $ 8,431 | |
Acquisition | 5,766 | 4,739 | ||||
Dispositions | 0 | 0 | ||||
Goodwill impairment loss | (5,597) | 0 | ||||
Net book value, ending balance | 13,339 | 13,339 | 13,339 | 13,339 | 13,170 | |
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 16,744 | 9,945 | ||||
Accumulated amortization | (6,265) | (3,865) | ||||
Net | 10,479 | 6,080 | ||||
Amortization of definite-lived intangible assets | 570 | 1,208 | 1,804 | 2,400 | 1,612 | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
2020 | 2,808 | |||||
2021 | 2,143 | |||||
2022 | 1,626 | |||||
2023 | 1,199 | |||||
Thereafter | 2,703 | |||||
Total | 10,479 | 6,080 | ||||
Customer Relationships [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 11,730 | 6,831 | ||||
Accumulated amortization | (4,079) | (2,375) | ||||
Net | 7,651 | 4,456 | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
Total | 7,651 | 4,456 | ||||
Trade Names [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 2,467 | 1,295 | ||||
Accumulated amortization | (727) | (318) | ||||
Net | 1,740 | 977 | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
Total | 1,740 | 977 | ||||
Developed Technology [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 471 | 471 | ||||
Accumulated amortization | (471) | (471) | ||||
Net | 0 | 0 | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
Total | 0 | 0 | ||||
Non-Controlling Customer Relationships [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 433 | 433 | ||||
Accumulated amortization | (433) | (433) | ||||
Net | 0 | 0 | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
Total | 0 | 0 | ||||
Noncompete Agreement [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 949 | 221 | ||||
Accumulated amortization | (217) | (35) | ||||
Net | 732 | 186 | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
Total | 732 | 186 | ||||
Alliance Agreement [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 527 | 527 | ||||
Accumulated amortization | (171) | (66) | ||||
Net | 356 | 461 | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
Total | 356 | 461 | ||||
Others [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Gross carrying amount | 167 | 167 | ||||
Accumulated amortization | (167) | (167) | ||||
Net | 0 | 0 | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||||
Total | 0 | 0 | ||||
Performance Improvement Solutions [Member] | ||||||
Goodwill [Roll Forward] | ||||||
Net book value, beginning balance | 4,739 | 4,739 | 4,739 | 4,739 | 0 | |
Acquisition | 5,766 | 4,739 | ||||
Dispositions | 0 | 0 | ||||
Goodwill impairment loss | (5,597) | 0 | ||||
Net book value, ending balance | 4,908 | 4,739 | ||||
Amortized Intangible Assets [Abstract] | ||||||
Amortization of definite-lived intangible assets | 1,871 | 898 | ||||
Nuclear Industry Training and Consulting [Member] | ||||||
Goodwill [Roll Forward] | ||||||
Net book value, beginning balance | $ 8,431 | $ 8,431 | $ 8,431 | 8,431 | 8,431 | |
Acquisition | 0 | 0 | ||||
Dispositions | 0 | 0 | ||||
Goodwill impairment loss | 0 | 0 | ||||
Net book value, ending balance | 8,431 | 8,431 | ||||
Amortized Intangible Assets [Abstract] | ||||||
Amortization of definite-lived intangible assets | 529 | $ 714 | ||||
DP Engineering Ltd, CO. [Member] | ||||||
Goodwill [Roll Forward] | ||||||
Acquisition | 5,800 | |||||
Goodwill impairment loss | (5,600) | |||||
Net book value, ending balance | $ 5,766 | |||||
Amortized Intangible Assets [Abstract] | ||||||
Definite-lived Intangible assets acquired | 6,798 | $ 6,798 | ||||
DP Engineering Ltd, CO. [Member] | Minimum [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Amortization term of intangible assets acquired | 5 years | |||||
Revised cash flow projected | 5 years | |||||
DP Engineering Ltd, CO. [Member] | Maximum [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Amortization term of intangible assets acquired | 15 years | |||||
Revised cash flow projected | 15 years | |||||
DP Engineering Ltd, CO. [Member] | Customer Relationships [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Definite-lived Intangible assets acquired | 4,898 | |||||
DP Engineering Ltd, CO. [Member] | Noncompete Agreement [Member] | ||||||
Amortized Intangible Assets [Abstract] | ||||||
Definite-lived Intangible assets acquired | $ 728 |
Contract Receivables (Details)
Contract Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Contract Receivables [Abstract] | ||||
Maximum term of contract receivables | 12 months | |||
Components of contract receivables [Abstract] | ||||
Billed receivables | $ 11,041 | $ 15,998 | ||
Unbilled receivables | 6,624 | 5,506 | ||
Allowance for doubtful accounts | $ (458) | $ (137) | (458) | (427) |
Total contract receivables, net | $ 17,207 | $ 21,077 | ||
Subsequent Billing | 3,800 | |||
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||||
Beginning balance | 427 | 137 | ||
Current year provision | 31 | 294 | ||
Current year write-offs | 0 | 0 | ||
Currency adjustment | 0 | (4) | ||
Ending balance | $ 458 | $ 427 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Prepaid Expenses and Other Current Assets [Abstract] | ||
Inventory | $ 0 | $ 139 |
Income tax receivable | 237 | 310 |
Prepaid expenses | 861 | 556 |
Other current assets | 782 | 795 |
Total prepaid expenses and other current assets | $ 1,880 | $ 1,800 |
Equipment, Software, and Leas_3
Equipment, Software, and Leasehold Improvements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Equipment, Software and Leasehold Improvements, Net [Abstract] | ||
Equipment, software, and leasehold improvements | $ 5,523 | $ 5,293 |
Accumulated depreciation | (4,584) | (4,228) |
Equipment, software, and leasehold improvements, net | 939 | 1,065 |
Depreciation | 363 | 515 |
Computer and Equipment [Member] | ||
Equipment, Software and Leasehold Improvements, Net [Abstract] | ||
Equipment, software, and leasehold improvements | 2,266 | 2,178 |
Software [Member] | ||
Equipment, Software and Leasehold Improvements, Net [Abstract] | ||
Equipment, software, and leasehold improvements | 1,693 | 1,682 |
Leasehold Improvements [Member] | ||
Equipment, Software and Leasehold Improvements, Net [Abstract] | ||
Equipment, software, and leasehold improvements | 664 | 619 |
Furniture and Fixtures [Member] | ||
Equipment, Software and Leasehold Improvements, Net [Abstract] | ||
Equipment, software, and leasehold improvements | $ 900 | $ 814 |
Product Warranty (Details)
Product Warranty (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Product warranty provision [Abstract] | ||||
Percentage of Non-Physical Material Cost of Individual Project | 4.00% | |||
Percentage of Conservative Estimate for Active Warranty Projects And Active Non-Warranty Projects | 3.00% | |||
Decrease in warranty provision | $ (200) | |||
Activities in product warranty account [Abstract] | ||||
Beginning balance | $ 1,621 | 1,953 | ||
Current period provision | (133) | (107) | ||
Current year claims | (164) | (215) | ||
Currency adjustment | (1) | (10) | ||
Ending balance | 1,323 | 1,621 | ||
Standard Product Warranty Accrual, Balance Sheet Classification [Abstract] | ||||
Current | $ 921 | $ 981 | ||
Non-current | 402 | 640 | ||
Total Warranty | $ 1,323 | $ 1,953 | $ 1,323 | $ 1,621 |
Minimum [Member] | ||||
Product warranty provision [Abstract] | ||||
Warranty Provision Contract Period | 1 year | |||
Maximum [Member] | ||||
Product warranty provision [Abstract] | ||||
Warranty Provision Contract Period | 5 years |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)LetterContract | Dec. 31, 2018USD ($) | |
Performance Bond [Abstract] | ||
Number of standby letters of credit | Letter | 4 | |
Letter of credit and surety bonds | $ 1,200 | |
Number of contracts | Contract | 3 | |
Assets and Liabilities Measured at Fair Value [Abstract] | ||
Money market funds | $ 434 | $ 824 |
Foreign exchange contracts - Assets | 49 | 43 |
Total assets | 483 | 867 |
Liability awards | (9) | (118) |
Interest rate swap contract | (160) | (103) |
Total liabilities | (169) | (221) |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | 0 | |
Issuance of contingent consideration in connection with acquisitions | 1,200 | |
Change in fair value | (1,200) | |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets and Liabilities Measured at Fair Value [Abstract] | ||
Money market funds | 434 | 824 |
Foreign exchange contracts - Assets | 0 | 0 |
Total assets | 434 | 824 |
Liability awards | 0 | 0 |
Interest rate swap contract | 0 | 0 |
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets and Liabilities Measured at Fair Value [Abstract] | ||
Money market funds | 0 | 0 |
Foreign exchange contracts - Assets | 49 | 43 |
Total assets | 49 | 43 |
Liability awards | (9) | (118) |
Interest rate swap contract | (160) | (103) |
Total liabilities | (169) | (221) |
Significant Unobservable Inputs (Level 3) [Member] | ||
Assets and Liabilities Measured at Fair Value [Abstract] | ||
Money market funds | 0 | 0 |
Foreign exchange contracts - Assets | 0 | 0 |
Total assets | 0 | 0 |
Liability awards | 0 | 0 |
Interest rate swap contract | 0 | 0 |
Total liabilities | 0 | $ 0 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Ending balance | $ 0 |
Debt (Details)
Debt (Details) | Feb. 15, 2019USD ($) | May 11, 2018USD ($) | Dec. 31, 2019USD ($)Letter | Dec. 31, 2018USD ($)Letter | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020USD ($) | Apr. 17, 2020USD ($) | Mar. 31, 2020USD ($) | Jan. 08, 2020USD ($)$ / shares | Jan. 06, 2020USD ($) | Sep. 30, 2019 | Jun. 30, 2019 | Jun. 28, 2019 |
Line of Credit Facility [Abstract] | |||||||||||||||||||
Number of letters of credit | Letter | 4 | ||||||||||||||||||
LIBOR [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Term of variable rate | 1 month | ||||||||||||||||||
Revolving Credit Facility [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Amount available at the reporting date | $ 3,800,000 | ||||||||||||||||||
Line of Credit [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Number of letters of credit | Letter | 5 | ||||||||||||||||||
Outstanding letter of credit balance | $ 2,300,000 | ||||||||||||||||||
Citizen's Bank [Member] | Revolving Credit Facility [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Long-term debt | $ 0 | ||||||||||||||||||
Principal amount of the line of credit | $ 5,000,000 | $ 5,000,000 | |||||||||||||||||
Number of letters of credit | Letter | 4 | ||||||||||||||||||
Outstanding letter of credit balance | $ 1,200,000 | ||||||||||||||||||
Line of credit facility expiration period | 3 years | ||||||||||||||||||
Citizen's Bank [Member] | Revolving Credit Facility [Member] | Minimum [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Percentage of letter of credit fees per annum | 1.25% | ||||||||||||||||||
Citizen's Bank [Member] | Revolving Credit Facility [Member] | Maximum [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Percentage of letter of credit fees per annum | 2.00% | ||||||||||||||||||
Fifth Amendment and Reaffirmation Agreement [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Leverage ratio | 275.00% | 275.00% | 275.00% | ||||||||||||||||
Fifth Amendment and Reaffirmation Agreement [Member] | Subsequent Event [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Leverage ratio | 275.00% | ||||||||||||||||||
Fifth Amendment and Reaffirmation Agreement [Member] | Plan [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Leverage ratio | 225.00% | 225.00% | 225.00% | 225.00% | 250.00% | 250.00% | |||||||||||||
Fifth Amendment and Reaffirmation Agreement [Member] | Minimum [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Fixed charge coverage ratio | 105.00% | ||||||||||||||||||
Fifth Amendment and Reaffirmation Agreement [Member] | Maximum [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Fixed charge coverage ratio | 125.00% | ||||||||||||||||||
Sixth Amendment and Reaffirmation Agreement [Member] | Subsequent Event [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
EBITDA target | $ / shares | $ 4.25 | ||||||||||||||||||
Bank fee payable | $ 20,000 | ||||||||||||||||||
Additional principal payable | $ 1,000,000 | $ 3,000,000 | |||||||||||||||||
Sixth Amendment and Reaffirmation Agreement [Member] | Plan [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Additional principal payable | $ 1,000,000 | ||||||||||||||||||
Sixth Amendment and Reaffirmation Agreement [Member] | Minimum [Member] | Subsequent Event [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Liquidity | $ 5,000,000 | ||||||||||||||||||
Seventh Amendment And Reaffirmation Agreement [Member] | Subsequent Event [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Leverage ratio | 125.00% | ||||||||||||||||||
Bank fee payable | $ 50,000 | ||||||||||||||||||
Additional principal payable | $ 750,000 | ||||||||||||||||||
Seventh Amendment And Reaffirmation Agreement [Member] | Plan [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Leverage ratio | 225.00% | 225.00% | 225.00% | 225.00% | 225.00% | 250.00% | 300.00% | ||||||||||||
Additional principal payable | $ 500,000 | ||||||||||||||||||
Delayed Draw Term Loan [Member] | |||||||||||||||||||
Long-term Debt, Current and Noncurrent [Abstract] | |||||||||||||||||||
Long-term debt, net of discount | $ 18,481,000 | ||||||||||||||||||
Less: current portion of long-term debt | 18,481,000 | ||||||||||||||||||
Long-term debt, less current portion | $ 0 | ||||||||||||||||||
Delayed Draw Term Loan [Member] | Minimum [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Debt instrument, basis spread on variable rate | 2.00% | ||||||||||||||||||
Delayed Draw Term Loan [Member] | Maximum [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Debt instrument, basis spread on variable rate | 2.75% | ||||||||||||||||||
Delayed Draw Term Loan [Member] | Citizen's Bank [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Line of credit facility term | 5 years | ||||||||||||||||||
Delayed Draw Term Loan [Member] | Citizen's Bank [Member] | Maximum [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Line of credit facility expiration period | 18 months | ||||||||||||||||||
Delayed Draw Term Loan [Member] | Citizen's Bank [Member] | Revolving Credit Facility [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Principal amount of the line of credit | 25,000,000 | ||||||||||||||||||
DP Engineering Ltd, CO. [Member] | |||||||||||||||||||
Term Loan [Abstract] | |||||||||||||||||||
Cash purchase price | $ 14,855,000 | 13,500,000 | |||||||||||||||||
Proceeds from issuance of debt | 14,300,000 | 14,300,000 | |||||||||||||||||
Earn-out amount | 5,000,000 | $ 2,000,000 | |||||||||||||||||
DP Engineering Ltd, CO. [Member] | Delayed Draw Term Loan [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Line of credit facility term | 5 years | ||||||||||||||||||
Term Loan [Abstract] | |||||||||||||||||||
Debt issuance costs | $ 0 | ||||||||||||||||||
Loan origination fees | $ 0 | ||||||||||||||||||
Earn-out amount | $ 5,000,000 | ||||||||||||||||||
DP Engineering Ltd, CO. [Member] | Delayed Draw Term Loan [Member] | Minimum [Member] | LIBOR [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Debt instrument, basis spread on variable rate | 2.00% | ||||||||||||||||||
DP Engineering Ltd, CO. [Member] | Delayed Draw Term Loan [Member] | Maximum [Member] | LIBOR [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Debt instrument, basis spread on variable rate | 2.75% | ||||||||||||||||||
True North Consulting, LLC [Member] | |||||||||||||||||||
Term Loan [Abstract] | |||||||||||||||||||
Cash purchase price | 9,915,000 | ||||||||||||||||||
Proceeds from issuance of debt | 10,300,000 | ||||||||||||||||||
True North Consulting, LLC [Member] | Delayed Draw Term Loan [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Line of credit facility term | 5 years | ||||||||||||||||||
Maturity date | May 11, 2023 | ||||||||||||||||||
Term Loan [Abstract] | |||||||||||||||||||
Proceeds from issuance of debt | 10,300,000 | ||||||||||||||||||
Repayments of debt | $ 500,000 | ||||||||||||||||||
Debt issuance costs | $ 70,000 | ||||||||||||||||||
Loan origination fees | $ 75,000 | ||||||||||||||||||
True North Consulting, LLC [Member] | Delayed Draw Term Loan [Member] | LIBOR [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Term of variable rate | 1 month | ||||||||||||||||||
True North Consulting, LLC [Member] | Delayed Draw Term Loan [Member] | Minimum [Member] | LIBOR [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Debt instrument, basis spread on variable rate | 2.00% | ||||||||||||||||||
True North Consulting, LLC [Member] | Delayed Draw Term Loan [Member] | Maximum [Member] | LIBOR [Member] | |||||||||||||||||||
Line of Credit Facility [Abstract] | |||||||||||||||||||
Debt instrument, basis spread on variable rate | 2.75% |
Derivative Instruments, Foreign
Derivative Instruments, Foreign Exchange Contracts (Details) - EUR (€) € in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative [Abstract] | ||
Expiration date of contract | Mar. 31, 2020 | |
Foreign Exchange Contracts [Member] | ||
Derivative [Abstract] | ||
Foreign exchange contract outstanding | € 1 | € 3.2 |
Derivative Instruments, Interes
Derivative Instruments, Interest Rate Risk Management (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Interest Rate Swap [Member] | |
Derivative [Abstract] | |
Notional amount | $ 9 |
Principal repayment term | 5 years |
Fixed interest rate | 3.02% |
Term Loan [Member] | Minimum [Member] | |
Derivative [Abstract] | |
Debt instrument, basis spread on variable rate | 2.00% |
Term Loan [Member] | Maximum [Member] | |
Derivative [Abstract] | |
Debt instrument, basis spread on variable rate | 2.75% |
LIBOR [Member] | |
Derivative [Abstract] | |
Term of variable rate | 1 month |
LIBOR - BBA Bloomberg [Member] | |
Derivative [Abstract] | |
Term of variable rate | 1 month |
Derivative Instruments, Fair Va
Derivative Instruments, Fair Values Derivatives, Balance Sheet Location (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Estimated fair value of the contracts in the consolidated balance sheets [Abstract] | ||
Asset derivatives | $ 49 | $ 43 |
Liability derivatives | (160) | (103) |
Net fair value | (111) | (60) |
Prepaid Expenses and Other Current Assets [Member] | ||
Estimated fair value of the contracts in the consolidated balance sheets [Abstract] | ||
Asset derivatives | 49 | 43 |
Other Liabilities [Member] | ||
Estimated fair value of the contracts in the consolidated balance sheets [Abstract] | ||
Liability derivatives | $ (160) | $ (103) |
Derivative Instruments, (Loss)
Derivative Instruments, (Loss) Gain on Derivative Instruments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Net (Loss) Gain on Derivative Instruments [Abstract] | ||
loss | $ 6 | $ (150) |
Interest rate swap - change in fair value | (57) | (103) |
loss | 38 | (97) |
Loss on derivative instruments, net | $ (13) | $ (350) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income (Loss) from Continuing Operations [Abstract] | |||||
Domestic | $ (6,671) | $ 2,512 | |||
Foreign | 319 | (1,735) | |||
Income (loss) before income taxes | $ (6,145) | $ (5,955) | $ (6,610) | (6,352) | 777 |
Current: [Abstract] | |||||
Federal | (30) | (6) | |||
State | 60 | 259 | |||
Foreign | 354 | 234 | |||
Subtotal | 384 | 487 | |||
Deferred [Abstract] | |||||
Federal | 4,686 | 600 | |||
State | 663 | 67 | |||
Foreign | 0 | (23) | |||
Subtotal | 5,349 | 644 | |||
Total | $ 5,733 | $ 1,131 | |||
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract] | |||||
Statutory federal income tax rate | 21.00% | 21.00% | |||
State income taxes, net of federal tax benefit | (12.10%) | 30.10% | |||
Effect of foreign operations | (0.30%) | (2.10%) | |||
Change in valuation allowance | (93.10%) | (43.60%) | |||
Meals and entertainment | (1.40%) | 10.00% | |||
Stock based compensation | (1.40%) | (6.90%) | |||
Other permanent differences | (0.60%) | 0.40% | |||
Uncertain tax positions | 0.90% | 46.30% | |||
Change in tax rate | 0.00% | (2.80%) | |||
Expired stock options | 0.00% | 50.70% | |||
Change in APB 23 liability | 0.00% | (4.40%) | |||
Prior year reconciling items | (3.30%) | (2.40%) | |||
Expiration of capital Loss | 0.00% | 49.30% | |||
Effective tax rate | (90.30%) | 145.60% | |||
Deferred Tax Assets [Abstract] | |||||
Net operating loss carryforwards | $ 4,396 | $ 4,074 | |||
Accruals | 247 | 760 | |||
Reserves | 408 | 479 | |||
Alternative minimum tax credit carryforwards | 126 | 213 | |||
Stock-based compensation expense | 539 | 563 | |||
Intangible assets | 1,021 | 674 | |||
Goodwill | 1,037 | 0 | |||
Operating lease liabilities | 998 | 0 | |||
Other | 464 | 324 | |||
Total deferred tax assets | 9,236 | 7,087 | |||
Valuation allowance | (7,576) | (756) | |||
Total deferred tax assets less valuation allowance | 1,660 | 6,331 | |||
Deferred Tax Liabilities [Abstract] | |||||
Undistributed earnings of foreign subsidiaries | 0 | (103) | |||
Software development costs | (161) | (163) | |||
Fixed assets | (7) | (44) | |||
Intangible assets | (22) | 0 | |||
Indefinite-lived intangibles | (728) | (525) | |||
Operating lease - right of use assets | (510) | 0 | |||
Other | (175) | (138) | |||
Total deferred tax liabilities | (1,603) | (973) | |||
Net deferred tax assets | 57 | 5,358 | |||
Operating Loss Carryforwards, expiration dates [Line Items] | |||||
Valuation allowance | 7,576 | 756 | |||
Largest deferred tax asset | 5,300 | ||||
Deferred tax assets operating loss carryforwards - Domestic, net | 4,000 | ||||
Deferred tax assets operating loss carryforwards - Domestic, gross | 19,200 | ||||
Deferred tax assets, operating loss carryforwards - Domestic, expiring, net | 3,900 | ||||
Deferred tax assets, operating loss carryforwards - Domestic, expiring, gross | 18,500 | ||||
Deferred tax assets, operating loss carryforwards - Domestic, indefinite lived, net | 100 | ||||
Deferred tax assets, operating loss carryforwards - Domestic, indefinite lived, gross | 700 | ||||
Deferred tax assets, operating loss carryforwards - State, net | 700 | ||||
Deferred tax assets, operating loss carryforwards - State, expiring, net | 500 | ||||
Deferred tax assets, operating loss carryforwards - State indefinite lived, net | 200 | ||||
Deferred tax assets, operating loss carryforwards - Foreign, indefinite lived, net | 600 | ||||
Deferred tax assets, operating loss carryforwards - foreign indefinite lived, gross | 2,800 | ||||
Income Tax Examination [Line Items] | |||||
Cash and cash equivalents | 11,691 | 12,123 | |||
U.S [Member] | |||||
Deferred Tax Assets [Abstract] | |||||
Valuation allowance | (6,900) | ||||
Operating Loss Carryforwards, expiration dates [Line Items] | |||||
Valuation allowance | 6,900 | ||||
U.K., Sweden, and China [Member] | |||||
Deferred Tax Assets [Abstract] | |||||
Valuation allowance | (700) | ||||
Operating Loss Carryforwards, expiration dates [Line Items] | |||||
Valuation allowance | $ 700 | ||||
State [Member] | |||||
Operating Loss Carryforwards, expiration dates [Line Items] | |||||
Operating Loss Carryforwards, Expiration Date | Dec. 31, 2039 | ||||
U.S. Federal and State Tax Authority [Member] | |||||
Income Tax Examination [Line Items] | |||||
Income tax examination, year under examination | 2000 | ||||
Foreign Tax Authority [Member] | |||||
Income Tax Examination [Line Items] | |||||
Income tax examination, year under examination | 2014 | ||||
Cash and cash equivalents | $ 4,400 | $ 4,700 | |||
Maximum [Member] | |||||
Operating Loss Carryforwards, expiration dates [Line Items] | |||||
Operating Loss Carryforwards, Expiration Date | Dec. 31, 2037 | ||||
Minimum [Member] | |||||
Operating Loss Carryforwards, expiration dates [Line Items] | |||||
Operating Loss Carryforwards, Expiration Date | Dec. 31, 2023 |
Income Taxes, Uncertain Tax Lia
Income Taxes, Uncertain Tax Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Federal [Member] | ||
Tax [Roll Forward] | ||
Beginning balance | $ 996 | $ 833 |
Increases | 0 | 163 |
Decreases | 203 | 0 |
Ending balance | 793 | 996 |
Interest and Penalties [Roll Forward] | ||
Beginning balance | 4 | 0 |
Increases | 2 | 4 |
Decreases | 0 | 0 |
Ending balance | 6 | 4 |
Foreign Tax Authority [Member] | ||
Uncertain Tax Liabilities, Total [Roll Forward] | ||
Beginning balance | 2,215 | 1,825 |
Increases | 195 | 420 |
Decreases | 222 | 30 |
Ending balance | 2,188 | 2,215 |
Foreign Tax Authority [Member] | China [Member] | ||
Tax [Roll Forward] | ||
Beginning balance | 204 | 216 |
Increases | 0 | 0 |
Decreases | 3 | 12 |
Ending balance | 201 | 204 |
Interest and Penalties [Roll Forward] | ||
Beginning balance | 285 | 262 |
Increases | 33 | 23 |
Decreases | 0 | 0 |
Ending balance | 318 | 285 |
Foreign Tax Authority [Member] | Ukraine [Member] | ||
Tax [Roll Forward] | ||
Beginning balance | 82 | 100 |
Increases | 0 | 0 |
Decreases | 4 | 18 |
Ending balance | 78 | 82 |
Interest and Penalties [Roll Forward] | ||
Beginning balance | 72 | 28 |
Increases | 0 | 44 |
Decreases | 12 | 0 |
Ending balance | 60 | 72 |
Foreign Tax Authority [Member] | South Korea [Member] | ||
Tax [Roll Forward] | ||
Beginning balance | 461 | 341 |
Increases | 93 | 120 |
Decreases | 0 | 0 |
Ending balance | 554 | 461 |
Interest and Penalties [Roll Forward] | ||
Beginning balance | 111 | 45 |
Increases | 67 | 66 |
Decreases | 0 | 0 |
Ending balance | $ 178 | $ 111 |
Capital Stock (Details)
Capital Stock (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Capital Stock [Abstract] | |||
Capital stock, shares authorized (in shares) | 62,000,000 | ||
Common stock, shares authorized (in shares) | 60,000,000 | 60,000,000 | |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 | |
Long Term Incentive Stock Option Plan 1995 [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance (in shares) | 5,900,759 | ||
Shares under options and warrants outstanding (in shares) | 5,000 | 55,000 | 1,046,833 |
Shares reserved upon vesting of restricted stock units (in shares) | 1,951,208 | ||
Shares of common stock remaining to be granted (in shares) | 1,599,241 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) | 12 Months Ended | |||
Dec. 31, 2019USD ($)Installment$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | |
Share-based Payment Award [Line Items] | ||||
Deferred income tax expense (benefits) | $ | $ 86,000 | $ (53,000) | ||
Stock based compensation expense related to cash-settled RSU's | $ | (93,000) | (142,000) | ||
Income tax benefit on stock based compensation | $ | $ 86,000 | (53,000) | ||
Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ||||
Unrecognized compensation expense | $ | $ 500,000 | |||
Weighted average remaining service period | 11 months 23 days | |||
Cash received from exercise of stock options | $ | $ 127,000 | 136,000 | ||
Aggregate intrinsic value of stock options exercised | $ | $ 0 | $ 701,318 | ||
Restricted Stock Units [Member] | ||||
Share-based Payment Award [Line Items] | ||||
RSU's outstanding (in shares) | 1,973,725 | 1,571,525 | 1,973,725 | 1,571,525 |
Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Nonvested RSUs, beginning balance (in shares) | 1,571,525 | 1,634,663 | ||
RSUs granted (in shares) | 918,459 | 428,526 | ||
RSUs forfeited | (64,172) | (140,997) | ||
RSUs vested | (452,087) | (350,667) | ||
Nonvested RSUs, ending balance (in shares) | 1,973,725 | 1,571,525 | ||
Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ||||
Nonvested RSUs at beginning of period (in dollars per share) | $ / shares | $ 1.96 | $ 1.96 | ||
RSUs granted (in dollars per share) | $ / shares | 2.56 | 3.23 | ||
RSUs forfeited (in dollars per share) | $ / shares | 3.12 | 2.47 | ||
RSUs vested (in dollars per share) | $ / shares | 3.30 | 3.30 | ||
Nonvested RSUs at end of period (in dollars per share) | $ / shares | $ 1.49 | $ 1.96 | ||
Restricted Stock Units [Member] | Minimum [Member] | ||||
Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ||||
Requisite service period for time-based RSU's | 1 year | |||
Restricted Stock Units [Member] | Maximum [Member] | ||||
Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ||||
Requisite service period for time-based RSU's | 5 years | |||
Long Term Incentive Stock Option Plan 1995 [Member] | ||||
Share-based Payment Award [Line Items] | ||||
Plan Expiration | Apr. 21, 2026 | |||
Number of shares authorized (in shares) | 7,500,000 | |||
Share-based compensation arrangement by share-based payment award, number of shares issued upon exercise of options (in shares) | 4,174,981 | |||
RSU's outstanding (in shares) | 1,951,208 | 1,951,208 | ||
Stock options remaining to be granted (in shares) | 1,599,241 | |||
Share based compensation expense | $ | $ 1,420,000 | $ 1,526,000 | ||
Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Options outstanding, beginning balance (in shares) | 55,000 | 1,046,833 | ||
Options granted (in shares) | 0 | 0 | ||
Options exercised (in shares) | 50,000 | 486,500 | ||
Options forfeited (in shares) | 0 | 505,333 | ||
Options outstanding, ending balance (in shares) | 5,000 | 55,000 | ||
Options expected to vest (in shares) | 0 | 0 | ||
Options and warrants exercisable, ending balance (in shares) | 5,000 | 55,000 | ||
Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ||||
Options outstanding, beginning balance (in dollars per share) | $ / shares | $ 1.87 | $ 3.33 | ||
Options granted (in dollars per share) | $ / shares | 0 | 0 | ||
Options exercised (in dollars per share) | $ / shares | 1.89 | 1.88 | ||
Options forfeited (in dollars per share) | $ / shares | 0 | 4.89 | ||
Options outstanding, ending balance (in dollars per share) | $ / shares | $ 1.65 | $ 1.87 | ||
Options expected to vest (in dollars per share) | $ / shares | $ 0 | $ 0 | ||
Options exercisable (in dollars per share) | $ / shares | $ 0 | $ 0 | ||
Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||
Options outstanding | $ | $ 0 | $ 17,000 | ||
Options expected to vest | $ | 0 | 0 | ||
Options exercisable | $ | $ 0 | $ 0 | ||
Options outstanding | 10 months 13 days | 2 years 29 days | ||
Options expected to vest | 0 years | 0 years | ||
Options exercisable | 0 years | 0 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward] | ||||
Options granted (in shares) | 0 | 0 | ||
Options vested during the period (in shares) | 0 | 24,000 | ||
Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||
Nonvested RSUs, ending balance (in shares) | 1,951,208 | |||
Long Term Incentive Stock Option Plan 1995 [Member] | Installments One [Member] | ||||
Share-based Payment Award [Line Items] | ||||
Number of Installments | Installment | 3 | |||
Long Term Incentive Stock Option Plan 1995 [Member] | Installments Two [Member] | ||||
Share-based Payment Award [Line Items] | ||||
Number of Installments | Installment | 5 | |||
Long Term Incentive Stock Option Plan 1995 [Member] | Installments Three [Member] | ||||
Share-based Payment Award [Line Items] | ||||
Number of Installments | Installment | 7 | |||
Long Term Incentive Stock Option Plan 1995 [Member] | Minimum [Member] | ||||
Share-based Payment Award [Line Items] | ||||
Term expiration for option to purchase shares | 7 years | |||
Long Term Incentive Stock Option Plan 1995 [Member] | Maximum [Member] | ||||
Share-based Payment Award [Line Items] | ||||
Term expiration for option to purchase shares | 10 years |
Leases (Details)
Leases (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($)SquarefeetTenant | Dec. 31, 2018USD ($) | ||
Lessee, Operating Lease, Description [Abstract] | |||
Lease abandonment restructuring charges | $ 1,500 | ||
Leased Assets [Abstract] | |||
Operating lease - right of use assets | 2,215 | $ 0 | |
Lease Liabilities [Abstract] | |||
Operating lease liabilities - Current | 1,153 | ||
Operating lease liabilities - Noncurrent | 3,000 | $ 0 | |
Operating lease liability | $ 4,153 | ||
Sublease square feet | Squarefeet | 3,650 | ||
Sublease date | May 1, 2019 | ||
Previously subleased square feet | Squarefeet | 3,822 | ||
Previous sublease date | Apr. 1, 2017 | ||
Consolidated Statement of Operations Information [Abstract] | |||
Operating lease cost | [1] | $ 1,112 | |
Short-term leases costs | [2] | 121 | |
Sublease income | [3] | (107) | |
Net lease cost | $ 1,126 | ||
Number of tenants | Tenant | 2 | ||
Minimum Lease Payments [Abstract] | |||
2020 | $ 1,335 | ||
2021 | 1,293 | ||
2022 | 1,184 | ||
2023 | 622 | ||
2024 | 106 | ||
Thereafter | 0 | ||
Total | 4,540 | ||
Less: Interest | 387 | ||
Present value of lease payments | $ 4,153 | ||
Lease Term and Discount Rate [Abstract] | |||
Weighted-average remaining lease term (in years) | 3 years 6 months 4 days | ||
Weighted-average discount rate | 5.00% | ||
Other Information [Abstract] | |||
Operating cash flows used in operating leases | $ 1,275 | ||
Cash paid for amounts included in measurement of liabilities | 1,275 | ||
Right-of-use assets obtained in exchange for new operating liabilities | $ 1,777 | ||
Minimum [Member] | |||
Lessee, Operating Lease, Description [Abstract] | |||
Remaining operating lease terms | 1 year | ||
Renewal option period | 1 year | ||
Maximum [Member] | |||
Lessee, Operating Lease, Description [Abstract] | |||
Remaining operating lease terms | 5 years | ||
Renewal option period | 5 years | ||
[1] | Includes variable lease costs which are immaterial. | ||
[2] | Include leases maturing less than twelve months from the report date. | ||
[3] | Sublease portfolio consists of 2 tenants, which sublease parts of our office located at 1332 Londontown Blvd, Suite 200, Sykesville, MD. |
Employee Benefits (Details)
Employee Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Employee Benefits [Abstract] | ||
Company's contribution to the plan | $ 290 | $ 309 |
Segment Information, Reconcilia
Segment Information, Reconciliation of Assets from Segment to Consolidated (Details) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2019USD ($)SegmentProfessional | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Feb. 15, 2019 | Dec. 31, 2018USD ($) | |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | ||||||
Number of reportable business segments | Segment | 2 | |||||
Number of professionals employed | Professional | 160 | |||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||||
Assets | $ 58,509 | $ 63,605 | $ 68,844 | $ 71,363 | $ 61,440 | |
Maximum [Member] | ||||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||||
Contract term | 2 years | |||||
Performance Improvement Solutions [Member] | ||||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||||
Assets | $ 41,550 | 40,353 | ||||
Nuclear Industry Training and Consulting [Member] | ||||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||||
Assets | $ 16,959 | $ 21,087 | ||||
Percentage of goodwill acquired | 100.00% | |||||
DP Engineering Ltd, Co [Member] | ||||||
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | ||||||
Percentage of ownership interest acquired | 100.00% |
Segment Information, Loss befor
Segment Information, Loss before income taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Revenues | $ 82,975 | $ 92,249 | |||
Depreciation | 363 | 515 | |||
Amortization of definite-lived intangible assets | $ 570 | $ 1,208 | $ 1,804 | 2,400 | 1,612 |
Operating (loss) income | (7,419) | 1,366 | |||
Interest expense | (988) | (268) | |||
Loss on derivative instruments | (13) | (350) | |||
Other income (expense), net | 2,068 | 29 | |||
Income (loss) before income taxes | $ (6,145) | $ (5,955) | $ (6,610) | (6,352) | 777 |
Performance Improvement Solutions [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Revenues | 45,776 | 42,954 | |||
Depreciation | 345 | 385 | |||
Amortization of definite-lived intangible assets | 1,871 | 898 | |||
Operating (loss) income | (5,802) | 2,640 | |||
Nuclear Industry Training and Consulting [Member] | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Revenues | 37,199 | 49,295 | |||
Depreciation | 18 | 130 | |||
Amortization of definite-lived intangible assets | 529 | 714 | |||
Operating (loss) income | $ (1,617) | $ (1,274) |
Segment Information, Geographic
Segment Information, Geographic Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | |
Segment Information [Abstract] | |||||
Percentage of revenues derived from customers in the nuclear power industry | 90.00% | 91.00% | |||
Segment Reporting Information [Line Items] | |||||
Total revenue | $ 82,975 | $ 92,249 | |||
Operating loss | (7,419) | 1,366 | |||
Assets | $ 58,509 | $ 61,440 | $ 63,605 | $ 68,844 | $ 71,363 |
Percentage of revenues derived from international sales | 16.00% | 15.00% | |||
Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | $ 0 | $ 0 | |||
Geography Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | (747) | (2,245) | |||
Operating loss | 0 | 0 | |||
Assets | (131,937) | (117,251) | |||
Performance Improvement Solutions [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 45,776 | 42,954 | |||
Operating loss | (5,802) | 2,640 | |||
Assets | 41,550 | 40,353 | |||
Nuclear Industry Training and Consulting [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 37,199 | 49,295 | |||
Operating loss | (1,617) | (1,274) | |||
Assets | 16,959 | 21,087 | |||
U.S [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 82,220 | 91,025 | |||
Operating loss | (7,710) | 2,902 | |||
Assets | 184,115 | 171,206 | |||
U.S [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 81,597 | 88,979 | |||
U.S [Member] | Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 623 | 2,046 | |||
Europe [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 0 | 2,150 | |||
Operating loss | 54 | (1,116) | |||
Assets | 3,526 | 3,893 | |||
Europe [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 0 | 2,150 | |||
Europe [Member] | Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 0 | 0 | |||
Asia [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 1,502 | 1,319 | |||
Operating loss | 237 | (420) | |||
Assets | 2,805 | 3,592 | |||
Asia [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 1,378 | 1,120 | |||
Asia [Member] | Intersegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 124 | $ 199 | |||
UK [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | 0 | ||||
Sweden [Member] | Operating Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Total revenue | $ 0 |
Supplemental Disclosure of Ca_3
Supplemental Disclosure of Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash paid: [Abstract] | ||
Interest | $ 989 | $ 278 |
Income taxes | $ 489 | $ 187 |
Non-consolidated Variable Int_2
Non-consolidated Variable Interest Entity (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Variable Interest Entity [Line Items] | |
Carrying value | $ 0 |
DP Engineering Ltd, Co [Member] | |
Variable Interest Entity [Line Items] | |
Ownership percentage | 48.00% |
Contribution amount | $ 48 |
NXA Consultants LLC [Member] | |
Variable Interest Entity [Line Items] | |
Ownership percentage | 52.00% |
Contribution amount | $ 52 |
Contingent Consideration (Detai
Contingent Consideration (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Feb. 15, 2019 |
Contingent Consideration [Abstract] | ||
Fair value of contingent consideration | $ 1.2 | |
Contingent liability outstanding | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | Mar. 27, 2020 | Jun. 30, 2020 | Apr. 30, 2020 | Mar. 31, 2020 | Jan. 31, 2020 | Dec. 31, 2019 |
Subsequent Event [Line Items] | ||||||
Percentage of customers in which the company is considered an essential service provider | 90.00% | |||||
Plan [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Principal payments | $ 1,500 | |||||
Subsequent Event [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Principal payments | $ 750 | $ 1,000 | $ 3,000 | |||
Proceeds from loan | $ 10,000 |