Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 08, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-16501 | |
Entity Registrant Name | Williams Industrial Services Group Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 73-1541378 | |
Entity Address, Address Line One | 200 Ashford Center North | |
Entity Address, Address Line Two | Suite 425 | |
Entity Address, City or Town | Atlanta | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30338 | |
City Area Code | 770 | |
Local Phone Number | 879-4400 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | WLMS | |
Security Exchange Name | NYSEAMER | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 26,422,761 | |
Entity Central Index Key | 0001136294 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 656 | $ 2,482 |
Restricted cash | 468 | 468 |
Accounts receivable, net of allowance of $327 and $427, respectively | 33,267 | 35,204 |
Contract assets | 13,483 | 12,683 |
Other current assets | 10,812 | 11,049 |
Total current assets | 58,686 | 61,886 |
Property, plant and equipment, net | 977 | 653 |
Goodwill | 35,400 | 35,400 |
Intangible assets | 12,500 | 12,500 |
Other long-term assets | 7,640 | 5,712 |
Total assets | 115,203 | 116,151 |
Current liabilities: | ||
Accounts payable | 10,939 | 12,168 |
Accrued compensation and benefits | 9,182 | 12,388 |
Contract liabilities | 2,289 | 3,412 |
Short-term borrowings | 10,223 | 676 |
Current portion of long-term debt | 1,050 | 1,050 |
Other current liabilities | 10,226 | 11,017 |
Current liabilities of discontinued operations | 104 | 316 |
Total current liabilities | 44,013 | 41,027 |
Long-term debt, net (Note 8) | 30,128 | 30,328 |
Deferred tax liabilities | 2,445 | 2,442 |
Other long-term liabilities | 4,443 | 1,647 |
Long-term liabilities of discontinued operations | 3,523 | 4,250 |
Total liabilities | 84,552 | 79,694 |
Commitments and contingencies (Note 10) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value, 170,000,000 shares authorized and 26,869,938 and 26,408,789 shares issued, respectively, and 26,427,635 and 25,939,621 shares outstanding, respectively | 263 | 261 |
Paid-in capital | 93,208 | 92,227 |
Accumulated other comprehensive loss | (122) | (95) |
Accumulated deficit | (62,692) | (55,930) |
Treasury stock, at par (442,303 and 469,168 common shares, respectively) | (6) | (6) |
Total stockholders' equity | 30,651 | 36,457 |
Total liabilities and stockholders' equity | $ 115,203 | $ 116,151 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
Accounts receivable allowance for doubtful accounts | $ 327 | $ 427 | |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 170,000,000 | 170,000,000 | |
Common stock, shares issued | 26,869,938 | 26,408,789 | |
Common stock, shares outstanding | 26,427,635 | 25,939,621 | 25,915,502 |
Treasury stock at par | 442,303 | 469,168 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Revenue | $ 56,059 | $ 91,571 | $ 125,618 | $ 152,422 |
Cost of revenue | 53,778 | 82,218 | 117,628 | 136,971 |
Gross profit | 2,281 | 9,353 | 7,990 | 15,451 |
Operating expenses | ||||
Selling and marketing expenses | 402 | 231 | 732 | 442 |
General and administrative expenses | 6,294 | 6,372 | 12,365 | 12,683 |
Depreciation and amortization expense | 46 | 46 | 112 | 87 |
Total operating expenses | 6,742 | 6,649 | 13,209 | 13,212 |
Operating income (loss) | (4,461) | 2,704 | (5,219) | 2,239 |
Interest expense, net | ||||
Interest expense, net | 1,261 | 1,213 | 2,480 | 2,506 |
Other income, net | (240) | (1,232) | (419) | (1,592) |
Total other (income) expense, net | 1,021 | (19) | 2,061 | 914 |
Income (loss) from continuing operations before income tax | (5,482) | 2,723 | (7,280) | 1,325 |
Income tax expense (benefit) | (171) | 77 | 58 | 262 |
Income (loss) from continuing operations | (5,311) | 2,646 | (7,338) | 1,063 |
Discontinued operations: | ||||
Income (loss) from discontinued operations before income tax | (47) | 243 | (47) | 164 |
Income tax expense (benefit) | (640) | 18 | (623) | 37 |
Income (loss) from discontinued operations | 593 | 225 | 576 | 127 |
Net income (loss) | $ (4,718) | $ 2,871 | $ (6,762) | $ 1,190 |
Basic loss per common share | ||||
Income (loss) from continuing operations | $ (0.20) | $ 0.10 | $ (0.28) | $ 0.04 |
Income from discontinued operations | 0.02 | 0.01 | 0.02 | 0.01 |
Basic income (loss) per common share | (0.18) | 0.11 | (0.26) | 0.05 |
Diluted income (loss) per common share | ||||
Income (loss) from continuing operations | (0.20) | 0.10 | (0.28) | 0.04 |
Income from discontinued operations | 0.02 | 0.01 | 0.02 | 0.01 |
Diluted income (loss) per common share | $ (0.18) | $ 0.11 | $ (0.26) | $ 0.05 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income (loss) | $ (4,718) | $ 2,871 | $ (6,762) | $ 1,190 |
Foreign currency translation adjustment | (169) | 30 | (27) | 34 |
Comprehensive income (loss) | $ (4,887) | $ 2,901 | $ (6,789) | $ 1,224 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Shares $0.01 Per Share | Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Treasury Shares | Total |
Balance, Beginning at Dec. 31, 2020 | $ 256 | $ 90,292 | $ 28 | $ (58,673) | $ (8) | $ 31,895 |
Balance, Beginning (in shares) at Dec. 31, 2020 | 25,926,333 | (589,891) | ||||
Increase (Decrease) in Shareholders' Equity | ||||||
Restricted stock awards granted (in shares) | 164,388 | 120,723 | ||||
Restricted stock units vested | $ 4 | $ 2 | 6 | |||
Restricted stock units vested (in shares) | 274,448 | |||||
Tax withholding on restricted stock units | (545) | (545) | ||||
Stock-based compensation | 625 | 625 | ||||
Foreign currency translation | 4 | 4 | ||||
Net income (loss) | (1,681) | (1,681) | ||||
Balance, Ending at Mar. 31, 2021 | $ 260 | 90,372 | 32 | (60,354) | $ (6) | 30,304 |
Balance, Ending (in shares) at Mar. 31, 2021 | 26,365,169 | (469,168) | ||||
Balance, Beginning at Dec. 31, 2020 | $ 256 | 90,292 | 28 | (58,673) | $ (8) | 31,895 |
Balance, Beginning (in shares) at Dec. 31, 2020 | 25,926,333 | (589,891) | ||||
Increase (Decrease) in Shareholders' Equity | ||||||
Net income (loss) | 1,190 | |||||
Balance, Ending at Jun. 30, 2021 | $ 260 | 90,836 | 62 | (57,483) | $ (6) | 33,669 |
Balance, Ending (in shares) at Jun. 30, 2021 | 26,384,670 | (469,168) | ||||
Balance, Beginning at Mar. 31, 2021 | $ 260 | 90,372 | 32 | (60,354) | $ (6) | 30,304 |
Balance, Beginning (in shares) at Mar. 31, 2021 | 26,365,169 | (469,168) | ||||
Increase (Decrease) in Shareholders' Equity | ||||||
Restricted stock units vested (in shares) | 19,501 | |||||
Tax withholding on restricted stock units | 40 | 40 | ||||
Stock-based compensation | 424 | 424 | ||||
Foreign currency translation | 30 | 30 | ||||
Net income (loss) | 2,871 | 2,871 | ||||
Balance, Ending at Jun. 30, 2021 | $ 260 | 90,836 | 62 | (57,483) | $ (6) | 33,669 |
Balance, Ending (in shares) at Jun. 30, 2021 | 26,384,670 | (469,168) | ||||
Balance, Beginning at Dec. 31, 2021 | $ 261 | 92,227 | (95) | (55,930) | $ (6) | $ 36,457 |
Balance, Beginning (in shares) at Dec. 31, 2021 | 26,408,789 | (469,168) | 26,408,789 | |||
Increase (Decrease) in Shareholders' Equity | ||||||
Restricted stock awards granted (in shares) | 291,894 | |||||
Stock-based compensation | (147) | $ (147) | ||||
Foreign currency translation | 142 | 142 | ||||
Net income (loss) | (2,044) | (2,044) | ||||
Balance, Ending at Mar. 31, 2022 | $ 261 | 92,080 | 47 | (57,974) | $ (6) | 34,408 |
Balance, Ending (in shares) at Mar. 31, 2022 | 26,700,683 | (469,168) | ||||
Balance, Beginning at Dec. 31, 2021 | $ 261 | 92,227 | (95) | (55,930) | $ (6) | $ 36,457 |
Balance, Beginning (in shares) at Dec. 31, 2021 | 26,408,789 | (469,168) | 26,408,789 | |||
Increase (Decrease) in Shareholders' Equity | ||||||
Net income (loss) | $ (6,762) | |||||
Balance, Ending at Jun. 30, 2022 | $ 263 | 93,208 | (122) | (62,692) | $ (6) | $ 30,651 |
Balance, Ending (in shares) at Jun. 30, 2022 | 26,869,938 | (442,303) | 26,869,938 | |||
Balance, Beginning at Mar. 31, 2022 | $ 261 | 92,080 | 47 | (57,974) | $ (6) | $ 34,408 |
Balance, Beginning (in shares) at Mar. 31, 2022 | 26,700,683 | (469,168) | ||||
Increase (Decrease) in Shareholders' Equity | ||||||
Restricted stock awards granted (in shares) | 26,865 | |||||
Restricted stock units vested (in shares) | 169,255 | |||||
Tax withholding on restricted stock units | $ 2 | (165) | (163) | |||
Stock-based compensation | 1,293 | 1,293 | ||||
Foreign currency translation | (169) | (169) | ||||
Net income (loss) | (4,718) | (4,718) | ||||
Balance, Ending at Jun. 30, 2022 | $ 263 | $ 93,208 | $ (122) | $ (62,692) | $ (6) | $ 30,651 |
Balance, Ending (in shares) at Jun. 30, 2022 | 26,869,938 | (442,303) | 26,869,938 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Operating activities: | ||
Net income (loss) | $ (6,762) | $ 1,190 |
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||
Net income from discontinued operations | (576) | (127) |
Deferred income tax provision (benefit) | 3 | (25) |
Depreciation and amortization on plant, property and equipment | 112 | 87 |
Amortization of deferred financing costs | 415 | 415 |
Amortization of debt discount | 100 | 100 |
Bad debt expense | (101) | (51) |
Stock-based compensation | 577 | 1,460 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 2,137 | (3,040) |
Contract assets | (787) | (4,268) |
Other current assets | 177 | (1,561) |
Other assets | (2,219) | (175) |
Accounts payable | (1,251) | 1,546 |
Accrued and other liabilities | (601) | 4,432 |
Contract liabilities | (1,122) | (1,246) |
Net cash used in operating activities, continuing operations | (9,898) | (1,263) |
Net cash used in operating activities, discontinued operations | (365) | (139) |
Net cash used in operating activities | (10,263) | (1,402) |
Investing activities: | ||
Purchase of property, plant and equipment | (438) | (418) |
Net cash used in investing activities | (438) | (418) |
Financing activities: | ||
Repurchase of stock-based awards for payment of statutory taxes due on stock-based compensation | (163) | (501) |
Proceeds from short-term borrowings | 144,220 | 140,194 |
Repayments of short-term borrowings | (134,673) | (138,482) |
Repayments of long-term debt | (525) | (525) |
Net cash provided by financing activities | 8,859 | 686 |
Effect of exchange rate change on cash | 16 | 128 |
Net change in cash, cash equivalents and restricted cash | (1,826) | (1,006) |
Cash, cash equivalents and restricted cash, beginning of period | 2,950 | 9,184 |
Cash, cash equivalents and restricted cash, end of period | 1,124 | 8,178 |
Supplemental Disclosures: | ||
Cash paid for interest | $ 2,292 | 1,887 |
Cash paid for income taxes, net of refunds | $ 1,553 |
BUSINESS AND BASIS OF PRESENTAT
BUSINESS AND BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2022 | |
BUSINESS AND ORGANIZATION | |
BUSINESS AND BASIS OF PRESENTATION | NOTE 1—BUSINESS AND BASIS OF PRESENTATION Business Williams Industrial Services Group Inc. (together with its wholly owned subsidiaries, “Williams,” the “Company,” “we,” “us” or “our,” unless the context indicates otherwise) was initially formed in 1998 as GEEG Inc., a Delaware corporation, and in 2001 changed its name to “Global Power Equipment Group Inc.,” and, as part of a reorganization, became the successor to GEEG Holdings, L.L.C., a Delaware limited liability company. Effective June 29, 2018, the Company changed its name to Williams Industrial Services Group Inc. to better align its name with the Williams business, and the Company’s stock trades on the NYSE American LLC under the ticker symbol “WLMS.” Williams has been safely helping power plant owners and operators enhance asset value for more than 50 years. It provides a broad range of construction, maintenance, and support services to infrastructure customers in energy, power, and industrial end markets. The Company’s mission is to be the preferred provider of construction, maintenance, and specialty services through commitment to superior safety performance, focus on innovation, and dedication to delivering unsurpassed value to its customers. Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) on a basis consistent with that used in the Annual Report on Form 10-K for the year ended December 31, 2021, filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) on March 16, 2022 (the “2021 Report”). In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments, including all normal recurring adjustments, necessary to present fairly the unaudited condensed consolidated balance sheets and statements of operations, comprehensive income, stockholders’ equity and cash flows for the periods indicated. All significant intercompany transactions have been eliminated. The December 31, 2021 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. These unaudited condensed consolidated interim financial statements and accompanying notes should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the 2021 Report. Accounting measurements at interim dates inherently involve greater reliance on estimates than at year-end. The results of operations for any interim period are not necessarily indicative of operations to be expected for the full year. The Company reports on a fiscal quarter basis utilizing a “modified” 5-4-4 calendar (modified in that the fiscal year always begins on January 1 and ends on December 31). However, the Company has continued to label its quarterly information using a calendar convention. The effects of this practice are modest and only exist when comparing interim period results. The reporting periods and corresponding fiscal interim periods are as follows: Reporting Interim Period Fiscal Interim Period 2022 2021 Three Months Ended March 31 January 1, 2022 to April 3, 2022 January 1, 2021 to April 4, 2021 Three Months Ended June 30 April 4, 2022 to July 3, 2022 April 5, 2021 to July 4, 2021 Three Months Ended September 30 July 4, 2022 to October 2, 2022 July 5, 2021 to October 3, 2021 |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 6 Months Ended |
Jun. 30, 2022 | |
RECENT ACCOUNTING PRONOUNCEMENTS | |
RECENT ACCOUNTING PRONOUNCEMENTS | NOTE 2—RECENT ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Pronouncements The Company did not implement any new accounting pronouncements during the first six months of 2022. However, the Company is currently evaluating the impact of future disclosures that may arise under recent SEC proposals. |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2022 | |
LEASES | |
LEASES | NOTE 3—LEASES The Company primarily leases office space and related equipment, as well as equipment, modular units and vehicles directly used in providing services to its customers. The Company’s leases have remaining lease terms of one In accordance with ASU 2016-02, for leases with terms greater than twelve months, the Company records the related right-of-use assets and lease liabilities at the present value of the fixed lease payments over the lease term at the lease commencement date. The Company uses its incremental borrowing rate to determine the present value of the lease as the rate implicit in the lease is typically not readily determinable. Short-term leases (leases with an initial term of twelve months or less or leases that are cancelable by the lessee and lessor without significant penalties) are expensed on a straight-line basis over the lease term. The majority of the Company’s short-term leases relate to equipment used in delivering services to its customers. These leases are entered into at agreed upon hourly, daily, weekly, or monthly rental rates for an unspecified duration and typically have a termination for convenience provision. Such equipment leases are considered short-term in nature unless it is reasonably certain that the equipment will be leased for a term greater than twelve months. On September 2, 2021, the Company made the decision to relocate its corporate headquarters to Atlanta, Georgia and entered into a ten-year lease agreement. The Company completed its relocation in March 2022. The lease is presented as a right-of-use asset and lease liability and the lease liability amounts to $3.3 million with a present value of $2.2 million over a ten-year term. If the Company defaults, the landlord has the right to use the security deposit for rent or other payments due to other damages, injury, expense or liability as defined in the lease agreement. Although the security deposit shall be deemed the property of the landlord, any remaining balance of the security deposit shall be returned by the landlord to the Company after termination of the lease as the Company’s obligations under the lease have been fulfilled. The Company subleased a portion of its former office space and collected $30,000 of sublease income during the six months ended June 30, 2022. The components of lease expense were as follows: Three Months Ended June 30, Six Months Ended June 30, Lease Cost/(Sublease Income) (in thousands) 2022 2021 2022 2021 Operating lease cost $ 573 $ 538 $ 1,119 $ 1,092 Short-term lease cost 1,611 813 3,228 1,433 Sublease income (15) - (30) - Total lease cost $ 2,169 $ 1,351 $ 4,317 $ 2,525 Lease cost related to finance leases was not significant for the three and six months ended June 30, 2022 and 2021. Information related to the Company’s right-of-use assets and lease liabilities were as follows: Lease Assets/Liabilities (in thousands) Balance Sheet Classification June 30, 2022 December 31, 2021 Lease Assets Right-of-use assets Other long-term assets $ 3,379 $ 1,527 Lease Liabilities Short-term lease liabilities Other current liabilities $ 1,467 $ 1,606 Long-term lease liabilities Other long-term liabilities 2,379 511 Total lease liabilities $ 3,846 $ 2,117 Supplemental information related to the Company’s leases were as follows: Six Months Ended June 30, (dollars in thousands) 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash used by operating leases $ 1,211 $ 1,154 Right-of-use assets obtained in exchange for new operating lease liabilities 2,854 737 Weighted-average remaining lease term - operating leases 5.70 years 1.38 years Weighted-average remaining lease term - finance leases 1.73 years 2.73 years Weighted-average discount rate - operating leases 9% 9% Weighted-average discount rate - finance leases 9% 9% Total remaining lease payments under the Company’s operating and finance leases were as follows: Operating Leases Finance Leases Six Months Ended June 30, (in thousands) Remainder of 2022 $ 1,013 $ 3 2023 905 6 2024 495 1 2025 375 - 2026 381 - Thereafter 1,873 - Total lease payments $ 5,042 $ 10 Less: interest (1,206) - Present value of lease liabilities $ 3,836 $ 10 |
CHANGES IN BUSINESS
CHANGES IN BUSINESS | 6 Months Ended |
Jun. 30, 2022 | |
CHANGES IN BUSINESS. | |
CHANGES IN BUSINESS | NOTE 4—CHANGES IN BUSINESS Discontinued Operations Electrical Solutions During the fourth quarter of 2017, the Company made the decision to exit and sell its Electrical Solutions segment (which was comprised solely of Koontz-Wagner Custom Controls Holdings LLC (“Koontz-Wagner”), a wholly owned subsidiary of the Company) in an effort to reduce the Company’s outstanding term debt. The Company determined that the decision to exit this segment met the definition of a discontinued operation. As a result, this segment has been presented as a discontinued operation for all periods presented. On July 11, 2018, Koontz-Wagner filed a voluntary petition for relief under Chapter 7 of Title 11 of the Bankruptcy Code with the U.S. Bankruptcy Court for the Southern District of Texas. The filing was for Koontz-Wagner only, not for the Company as a whole, and was completely separate and distinct from the Williams business and operations. As a result of the July 11, 2018 bankruptcy of Koontz-Wagner, the Company recorded a pension withdrawal liability of $2.9 million related to Koontz-Wagner’s International Brotherhood of Electrical Workers Local Union 1392 (“IBEW”) multi-employer pension plan. After an arbitration process, on May 12, 2021, an arbitrator concluded that the IBEW used an incorrect per hour contribution rate in calculating the Company’s pension withdrawal liability, which resulted in the Company overpaying. The arbitrator directed IBEW to refund all overpayments, with interest, to the Company and to redetermine the Company’s payments going forward using the proper contribution rate. Accordingly, the Company’s overall pension withdrawal liability decreased by approximately $0.3 million. The pension liability is expected to be satisfied by annual cash payments of $0.3 million each, paid in quarterly installments, through 2038. The Company recorded a gain on disposal of approximately $0.2 million during the first six months of 2021 to reduce its previously recorded estimated withdrawal liability. Mechanical Solutions During the third quarter of 2017, the Company made the decision to exit and sell substantially all of the operating assets and liabilities of its Mechanical Solutions segment and determined that the decision to exit this segment met the definition of a discontinued operation. As a result, this segment has been presented as a discontinued operation for all periods presented. As of June 30, 2022 and December 31, 2021, the Company did not have any assets related to its Electrical Solutions’ and Mechanical Solutions’ discontinued operations. The following table presents a reconciliation of the carrying amounts of major classes of liabilities of Electrical Solutions’ and Mechanical Solutions’ discontinued operations: (in thousands) June 30, 2022 December 31, 2021 Liabilities: Current liabilities of discontinued operations $ 104 $ 316 Liability for pension obligation 2,287 2,368 Liability for uncertain tax positions 1,236 1,882 Long-term liabilities of discontinued operations 3,523 4,250 Total liabilities of discontinued operations $ 3,627 $ 4,566 The following table presents a reconciliation of the major classes of line items constituting the net loss from discontinued operations. In accordance with GAAP, the amounts in the table below do not include an allocation of corporate overhead. Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 General and administrative expenses $ — $ 6 $ — $ 34 Loss (gain) on disposal - Electrical Solutions 17 (228) 17 (228) Interest expense (income) 30 (21) 30 30 Income (loss) from discontinued operations before income tax (47) 243 (47) 164 Income tax expense (benefit) (640) 18 (623) 37 Income (loss) from discontinued operations $ 593 $ 225 $ 576 $ 127 |
REVENUE
REVENUE | 6 Months Ended |
Jun. 30, 2022 | |
REVENUE. | |
REVENUE | NOTE 5—REVENUE Disaggregation of Revenue The Company’s contracts generally include a single performance obligation for which revenue is recognized over time, as performance obligations are satisfied, due to the continuous transfer of control to the customer. For cost-plus contracts, the Company recognizes revenue when services are performed and contractually billable based upon the hours incurred and agreed-upon hourly rates. Revenue on fixed-price contracts is recognized and invoiced over time using the cost-to-cost percentage-of-completion method. To the extent a contract is deemed to have multiple performance obligations, the Company allocates the transaction price of the contract to each performance obligation using its best estimate of the standalone selling price of each distinct good or service in the contract. The Company does not adjust the price of the contract for the effects of a significant financing component. Change orders are generally not distinct from the existing contract due to the significant integration service provided in the context of the contract and are accounted for as a modification of the existing contract and performance obligation. The Company believes these methods of revenue recognition most accurately reflect the economics of the transactions with its customers. The Company’s contracts may include several types of variable consideration, including change orders, rate true-up provisions, retainage, claims, incentives, penalties, and liquidated damages. The Company estimates the amount of revenue to be recognized on variable consideration using estimation methods that best predict the amount of consideration to which the Company expects to be entitled. The Company includes variable consideration in the estimated transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur or when the uncertainty associated with the variable consideration is resolved. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based on an assessment of its anticipated performance and all information (historical, current, and forecasted) that is reasonably available. The Company updates its estimate of the transaction price each reporting period and the effect of variable consideration on the transaction price is recognized as an adjustment to revenue on a cumulative catch-up basis. In circumstances where the Company cannot reasonably determine the outcome of a contract, it recognizes revenue over time as the work is performed, but only to the extent of recoverable costs incurred (i.e. zero margin). A loss provision is recorded for the amount of any estimated unrecoverable costs in excess of total estimated revenue on a contract as soon as the Company becomes aware. The Company generally provides a limited warranty for a term of two years or less following completion of services performed under its contracts. Historically, warranty claims have not resulted in material costs incurred. Disaggregated revenue by type of contract was as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 Cost-plus reimbursement contracts $ 39,771 $ 82,071 $ 94,026 $ 137,664 Fixed-price contracts 16,288 9,500 31,592 14,758 Total $ 56,059 $ 91,571 $ 125,618 $ 152,422 Disaggregated revenue by the geographic area where the work was performed was as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 United States $ 56,059 $ 81,718 $ 120,116 $ 132,908 Canada - 9,853 5,502 19,514 Total $ 56,059 $ 91,571 $ 125,618 $ 152,422 Contract Balances The Company enters into contracts that allow for periodic billings over the contract term that are dependent upon specific advance billing terms, as services are provided, or as milestone billings based on completion of certain phases of work. Projects with performance obligations recognized over time that have costs and estimated earnings recognized to date in excess of cumulative billings are reported in the Company’s unaudited condensed consolidated balance sheets as contract assets. Projects with performance obligations recognized over time that have cumulative billings in excess of costs and estimated earnings recognized to date are reported in the Company’s unaudited condensed consolidated balance sheets as contract liabilities. At any point in time, each project in process could have either contract assets or contract liabilities. The following table provides information about contract assets and contract liabilities from contracts with customers: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 Costs incurred on uncompleted contracts $ 53,778 $ 82,218 $ 117,628 $ 136,971 Earnings recognized on uncompleted contracts 2,281 9,353 7,990 15,451 Total 56,059 91,571 125,618 152,422 Less—billings to date (44,865) (80,589) (114,424) (141,440) Net $ 11,194 $ 10,982 $ 11,194 $ 10,982 Contract assets $ 13,483 $ 12,265 $ 13,483 $ 12,265 Contract liabilities (2,289) (1,283) (2,289) (1,283) Net $ 11,194 $ 10,982 $ 11,194 $ 10,982 For the three and six months ended June 30, 2022, the Company recognized revenue of approximately $0.7 million and $2.1 million, respectively, on approximately $3.4 million that was included in the corresponding contract liability balance on December 31, 2021. Remaining Performance Obligations The following table includes estimated revenue expected to be recognized in the future related to performance obligations that were unsatisfied (or partially unsatisfied) as of June 30, 2022: (in thousands) Remainder of 2022 2023 2024 Thereafter Total Remaining performance obligations $ 98,141 $ 38,916 $ 10,762 $ 86,484 $ 234,303 |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 6 Months Ended |
Jun. 30, 2022 | |
EARNINGS (LOSS) PER SHARE | |
EARNINGS PER SHARE | NOTE 6—EARNINGS (LOSS) PER SHARE As of June 30, 2022, the Company’s 26,427,635 shares outstanding included 321,142 shares of contingently issued but unvested restricted stock. As of June 30, 2021, the Company’s 25,915,502 shares outstanding included 215,956 shares of contingently issued but unvested restricted stock. Restricted stock is excluded from the calculation of basic weighted average shares outstanding, but its impact, if dilutive, is included in the calculation of diluted weighted average shares outstanding. Basic earnings per common share are calculated by dividing net income by the weighted average common shares outstanding during the period. Diluted earnings per common share are based on the weighted average common shares outstanding during the period, adjusted for the potential dilutive effect of common shares that would be issued upon the vesting and release of restricted stock awards and units and stock options, if any. Basic and diluted earnings per common share from continuing operations were calculated as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands, except share data) 2022 2021 2022 2021 Income (loss) from continuing operations $ (5,311) $ 2,646 $ (7,338) $ 1,063 Basic income (loss) per common share: Weighted average common shares outstanding 26,106,493 25,683,258 26,034,907 25,306,130 Basic income (loss) per common share $ (0.20) $ 0.10 $ (0.28) $ 0.04 Diluted income (loss) per common share: Weighted average common shares outstanding 26,106,493 25,683,258 26,034,907 25,306,130 Diluted effect: Unvested portion of restricted stock units and awards — 753,247 — 762,961 Weighted average diluted common shares outstanding 26,106,493 26,436,505 26,034,907 26,069,091 Diluted income (loss) per common share $ (0.20) $ 0.10 $ (0.28) $ 0.04 The weighted average number of shares outstanding used in the computation of basic and diluted earnings per common share does not include the effect of the following potential outstanding common stock. The effects of the potentially outstanding service-based restricted stock and restricted stock unit awards were not included in the calculation of diluted earnings per common share because the effect would have been anti-dilutive. The effects of the potentially outstanding performance- and market-based restricted stock unit awards were not included in the calculation of diluted earnings per common share because the performance and/or market conditions had not been satisfied as of June 30, 2022 and 2021. Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Unvested service-based restricted stock and restricted stock unit awards 599,344 — 623,836 — Unvested performance- and market-based restricted stock unit awards 912,675 833,111 912,675 833,111 |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2022 | |
INCOME TAXES | |
INCOME TAXES | NOTE 7—INCOME TAXES The effective income tax expense rate for continuing operations for the three and six months ended June 30, 2022 and 2021 was as follows: Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Effective income tax rate for continuing operations 3.1% 2.8% (0.8)% 19.8% The effective income tax rate differs from the statutory federal income tax rate of 21% primarily because of the partial valuation allowances recorded on the Company’s deferred tax assets and the Canadian income tax provision. For the three months ended June 30, 2022, the Company recorded income tax benefit from continuing operations of $0.2 million, or 3.1% of pretax loss from continuing operations, compared with income tax expense from continuing operations of $0.1 million, or 2.8% of pretax income from continuing operations, in the corresponding period of 2021. For the six months ended June 30, 2022, the Company recorded income tax expense from continuing operations of $0.1 million, or (0.8)% of pretax loss from continuing operations, compared with income tax expense from continuing operations of $0.3 million, or 19.8% of pretax income from continuing operations, in the corresponding period of 2021. The decrease in income tax provision from continuing operations for the three and six months ended June 30, 2022, compared with the corresponding periods in 2021, was primarily related to the $0.2 million decrease in the Canadian income tax provision. The Company’s net deferred balance was primarily composed of indefinite lived deferred tax liabilities attributable to goodwill and trade names, and the indefinite lived deferred tax assets related to the post 2017 net operating losses and Section 163(j) interest addback. A full valuation allowance was applied to most of the remaining deferred balances. The indefinite lived deferred tax assets enabled the release of the valuation allowance to the extent that it can offset the indefinite lived deferred tax liabilities. Because all indefinite lived deferred tax liabilities are part of continued operations, and the release of valuation allowance is attributable to the future taxable income related to these deferred tax liabilities, the entire valuation allowance released was recorded in continuing operations according to ASC 740-20-45-3. As of June 30, 2022, the Company had $2.4 million net deferred tax liabilities, mainly composed of $12.4 million indefinite lived deferred tax liabilities attributable to goodwill and trade names, partially offset by $6.8 million indefinite lived deferred tax assets attributable to post 2017 net operating losses, and $3.3 million indefinite lived deferred tax assets attributable to Section 163(j) interest addback, plus $0.3 million deferred tax liability accrued with respect to the Company’s outside basis difference in its investment in Canada. As of June 30, 2022, and 2021, the Company would have needed to generate approximately $291.3 million and $273.4 million, respectively, of future taxable income in order to realize its deferred tax assets. The Company’s foreign subsidiaries may generate earnings that are not subject to U.S. income taxes so long as they are permanently reinvested in its operations outside of the U.S. Pursuant to ASC 740-30, undistributed earnings of foreign subsidiaries that are no longer permanently reinvested would become subject to deferred income taxes. As of June 30, 2022, the Company projects that its Canadian subsidiary will have generated approximately $5.9 million undistributed earnings by the end of 2022. The Company’s management expects that all of the undistributed earnings will be repatriated back to the United States within the next 12 months. The Company formed the Canadian subsidiary in 2018 without significant capital investment, and the majority of the undistributed earnings was expected to be repatriated as dividends to the United States at the United States-Canada treaty rate of 5%. As a result, the Company accrued a deferred tax liability of $0.3 million related to its investment in Canada for its outside basis difference as of June 30, 2022. As of each of June 30, 2022 and 2021, the Company provided for a total liability of $2.3 million and $2.9 million, respectively, for uncertain income tax positions, which include the unrecognized tax benefits related to various federal, foreign and state income tax matters, and the accrual of interest, penalties, and foreign currency adjustments that can potentially arise from these positions. For the period ended June 30, 2022, the $2.3 million reserved for uncertain income tax positions were included in long-term liabilities of discontinued operations and other long-term liabilities, of which $1.2 million were related to discontinued operations, compared to $1.8 million for the corresponding period in 2021. If the unrecognized tax benefit is recognized, the reduction in the liability would be recorded as a tax benefit and reduce the effective tax rate. Among the $2.3 million reserved for uncertain income tax positions, approximately $1.1 million was accrued for potential payment of interest and penalties, of which, $0.5 million was related to discontinued operations. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was enacted and signed into U.S. law to provide economic relief to individuals and businesses facing economic hardship as a result of the COVID-19 pandemic. The Company has incorporated the impact of the CARES Act to the tax provision. In addition, the Company deferred payments of federal employer payroll taxes of approximately $4.9 million, as permitted by the CARES Act. The first half of the deferred amounts were paid in December 2021, and the second half will be paid by December 2022. |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2022 | |
DEBT | |
DEBT | NOTE 8—DEBT The following table provides information about the Company’s debt, net of unamortized deferred financing costs: (in thousands) June 30, 2022 December 31, 2021 Short-term borrowings $ 10,223 $ 676 Term loan, current portion of long-term debt 1,050 1,050 Current debt $ 11,273 $ 1,726 Term loan, noncurrent portion of long-term debt $ 32,375 $ 32,900 Debt discount (691) (791) Unamortized deferred financing costs (1,556) (1,781) Long-term debt, net $ 30,128 $ 30,328 Total debt, net $ 41,401 $ 32,054 Debt Refinancing On December 16, 2020 (the “Closing Date”), the Company and certain of its subsidiaries refinanced and replaced its prior revolving credit facility and term loan facility and entered into (i) the Term Loan Agreement (as defined below), which provided for senior secured term loan facilities in an aggregate principal amount of up to $50.0 million (collectively, the “Term Loan”), consisting of a $35.0 million closing date term loan facility (the “Closing Date Term Loan”) and up to $15.0 million of borrowings under a delayed draw facility (the “Delayed Draw Term Loan Facility”) with EICF Agent LLC, as agent, and CION Investment Corporation, as a lender and a co-lead arranger, and the other lenders party thereto; and (ii) a senior secured asset-based revolving line of credit of up to $30.0 million (the “Revolving Credit Facility”) with PNC Bank, National Association (“PNC”). In connection with the refinancing, the Company repaid the outstanding balance of the prior facilities and all interest in full. As of June 30, 2022, the Company had $10.2 million outstanding debt under the Revolving Credit Facility and $33.4 million outstanding (including both the noncurrent and current portion of the Term Loan) under the Term Loan. As of June 30, 2022, the Company was in compliance with all debt covenants, as amended effective June 30, 2022. In connection with the Company’s assessment of going concern considerations in accordance with FASB ASC Topic 205-40, “Presentation of Financial Statements - Going Concern,” management has determined that the Revolving Credit amendment described above and other factors such as the company’s backlog, alleviated initial doubt about the Company’s ability to continue as a going concern. The Revolving Credit Facility On the Closing Date, the Company and certain of its subsidiaries (the “Revolving Loan Borrowers”) entered into the Revolving Credit and Security Agreement with PNC, as agent for the lenders, and the lenders party thereto (the “Revolving Credit Agreement”), which provides for the Revolving Credit Facility. As part of the Revolving Credit Facility, the Company may access a letter of credit sublimit in an amount up to $2.0 million, a swing loan sublimit in an aggregate principal amount of up to $3.0 million, and a Canadian dollar sublimit in an aggregate principal amount of up to $5.0 million. The Revolving Credit Agreement matures on December 16, 2025. As of June 30, 2022, borrowings under the Revolving Credit Facility bore interest, at the Company’s election, at either (1) the base commercial lending rate of PNC, as publicly announced, plus 1.25%, payable in cash on a monthly basis, (2) the 30, 60 or 90 day LIBOR rate, subject to a minimum LIBOR floor of 1.00%, plus 2.25%, payable in cash on the last day of each interest period, or (3) with respect to Canadian dollar loans, the Canadian Dollar Offered Rate (“CDOR”), subject to a minimum CDOR rate of 1.00%, payable in cash on a monthly basis. In addition, upon the occurrence of an event of default, and for so long as such event of default continues, default interest equal to 2.00% per year in excess of the rate otherwise applicable will be payable. The Revolving Credit Agreement also includes customary replacement provisions in the event of the discontinuation of LIBOR. The Revolving Loan Borrowers’ Obligations (as defined in the Revolving Credit Agreement) are guaranteed by certain of the Company’s material, wholly owned subsidiaries, subject to customary exceptions (the “Revolving Loan Guarantors” and, together with the Revolving Loan Borrowers, the “Revolving Loan Credit Parties”). The Revolving Loan Credit Parties’ obligations are secured by first-priority security interests on substantially all of the Revolving Loan Credit Parties’ accounts receivable and a second-priority security interest in substantially all other assets of the Revolving Loan Credit Parties, subject to the terms of the Intercreditor Agreement between PNC and EICF Agent LLC, as the Revolving Loan Agent and the Term Loan Agent, respectively (as each such term is defined in the Intercreditor Agreement), as described below (the “Intercreditor Agreement”). The Revolving Loan Borrowers may from time to time voluntarily prepay outstanding amounts, plus any accrued but unpaid interest on the aggregate amount being prepaid, under the Revolving Credit Facility, in whole or in part. There is no required minimum prepayment amount. If at any time the amount outstanding under the Revolving Credit Agreement exceeds the borrowing base, or any sublimit, in effect at such time, the excess amount will be immediately due and payable. Subject to the Intercreditor Agreement, the Revolving Credit Agreement also requires mandatory prepayment of outstanding amounts in the event the Revolving Loan Borrowers receive proceeds from certain events and activities, including, among others, certain asset sales and casualty events, the issuance of indebtedness and equity interests, and the recovery of any proceeds from certain specified arbitration proceedings. The Revolving Credit Agreement provides for (1) a closing fee of $0.2 million, which was paid on the Closing Date, (2) a customary unused line fee equal to 0.25% per year on the unused portion of the Revolving Credit Facility, which is payable on a quarterly basis, and (3) a collateral monitoring fee of $2,500, which is payable on a monthly basis. The Revolving Credit Agreement also provides for an early termination fee (the “Early Termination Fee”), payable to the revolving lenders thereunder upon (1) any acceleration of the Obligations and termination of the Revolving Credit Agreement and the obligation of the revolving lenders to make advances thereunder following the occurrence of an Event of Default (as defined in the Revolving Credit Agreement), or (2) any other termination of the Revolving Credit Agreement and the obligation of revolving lenders to make advances thereunder for any reason (the “Early Termination Date”). The Early Termination Fee is calculated as follows: if the Early Termination Date occurred on or prior to the first anniversary of the Closing Date, the Early Termination Fee would have been 2.00% of the Revolving Credit Facility; and if prepayment occurs after the first anniversary of the Closing Date and on or prior to the second anniversary of the Closing Date, the Early Termination Fee will be 1.00% of the Revolving Credit Facility. While any letter of credit is outstanding under the Revolving Credit Facility, the Revolving Loan Borrowers must pay a letter of credit fronting fee at a rate equal to 0.25% per year, payable quarterly, in addition to any other customary fees required by the issuer of the letter of credit. The Revolving Credit Agreement contains customary representations and warranties, as well as customary affirmative and negative covenants, in each case, with certain exceptions, limitations and qualifications. The Revolving Credit Agreement also requires the Revolving Loan Borrowers to regularly provide certain financial information to the lenders thereunder, maintain a springing minimum fixed charge coverage ratio, and comply with certain limitations on capital expenditures. Events of default under the Revolving Credit Agreement include, but are not limited to, a breach of certain covenants or any representations or warranties, failure to timely pay any amounts due and owing, the commencement of any bankruptcy or other insolvency proceeding, judgments in excess of certain acceptable amounts, the occurrence of a change in control, certain events related to ERISA matters, impairment of security interests in collateral or invalidity of guarantees or security documents, or a default or event of default under the Term Loan Agreement or the Intercreditor Agreement, in each case, with customary exceptions, limitations, grace periods and qualifications. If an event of default occurs, the revolving lenders may, among other things, declare all Obligations outstanding under the Revolving Credit Facility to be immediately due and payable, together with accrued interest and fees, and exercise remedies under the collateral documents relating to the Revolving Credit Agreement. On August 3, 2022, the Company entered into an Amendment to the Revolving Credit Agreement (the “Revolving Credit Amendment”) that, among other things, (i) amended the calculation of EBITDA (as defined in the Revolving Credit Agreement), effective as of June 30, 2022, to include (or “add back”) certain non-recurring losses and expenses relating to projects executed in Jacksonville, Florida, one-time costs and expenses incurred in connection with the Company’s transmission and distribution business unit start-up, and costs and expenses arising out of the Company’s litigation with a designated former executive and his employer (in each case, subject to certain specified dollar limits), (ii) permitted advances against certain eligible receivables of one of the Company’s joint ventures (also subject to specified dollar limits), (iii) included provisions that replace the London Interbank Offered Rate (LIBOR) interest rate with customary provisions based on the secured overnight financing rate (SOFR), and (iv) provided for the payment of a $25,000 amendment fee, plus applicable fees and expenses. The $25,000 amendment fee will be expensed as incurred. EICF Agent LLC, as the Term Loan Agent, and PNC, as the Revolving Loan Agent, entered into an Intercreditor Agreement, dated as of the Closing Date, to which the Term Loan Credit Parties (as defined below) and Revolving Loan Credit Parties consented. The Intercreditor Agreement, among other things, specifies the relative lien priorities of the Term Loan Agent and Revolving Loan Agent in the relevant collateral, and contains customary provisions regarding, among other things, the rights of the Term Loan Agent and Revolving Loan Agent to take enforcement actions against the relevant collateral and certain limitations on amending the documentation governing each of the Term Loan and Revolving Credit Facility. The Term Loan On the Closing Date, the Company and certain of its subsidiaries (the “Term Loan Borrowers”) entered into the Term Loan, Guarantee and Security Agreement with EICF Agent LLC, as agent for the lenders, CION Investment Corporation, as a lender and co-lead arranger, and the other lenders party thereto (the “Term Loan Agreement”), which provides for the Term Loan. The Closing Date Term Loan was fully drawn on the Closing Date, while the Delayed Draw Term Loan Facility was available upon the satisfaction of certain conditions precedent for up to 18 months following the Closing Date and expired in June 2022. The Term Loan Agreement matures on December 16, 2025. Borrowings under the Term Loan Agreement bear interest at LIBOR, plus a margin of 8.50% (if the Total Leverage Ratio (as defined in the Term Loan Agreement) is less than 2.50:1) or 9.00% per year (if the Total Leverage Ratio is greater than or equal to 2.50:1), subject to a minimum LIBOR floor of 1.00%, payable in cash on a quarterly basis. In addition, upon the occurrence of an event of default, and for so long as such event of default continues, default interest equal to 2.00% per year in excess of the rate otherwise applicable will be payable. The Term Loan Agreement also includes customary replacement provisions in the event of the discontinuation of LIBOR. The Term Loan Borrowers’ Obligations (as defined in the Term Loan Agreement) are guaranteed by certain of the Company’s material, wholly owned subsidiaries, subject to customary exceptions (the “Term Loan Guarantors” and, together with the Term Loan Borrowers, the “Term Loan Credit Parties”). The Term Loan Credit Parties’ obligations are secured by first-priority security interests on substantially all of the Term Loan Credit Parties’ assets, as well as a second-priority security interest on the Term Loan Credit Parties’ accounts receivable and inventory, subject to the Intercreditor Agreement. Subject to certain conditions, the Term Loan Borrowers may voluntarily prepay the Term Loan on any Payment Date (as defined in the Term Loan Agreement), in whole or in part, in a minimum amount of $1.0 million of the outstanding principal amount, plus a prepayment fee. The prepayment fee was amended effective June 30, 2022, as described below. Subject to certain exceptions, within 120 days The Term Loan Agreement contains customary representations and warranties, as well as customary affirmative and negative covenants, in each case, with certain exceptions, limitations and qualifications. The Term Loan Agreement also requires the Term Loan Borrowers to regularly provide certain financial information to the lenders thereunder, maintain a maximum total leverage ratio and a minimum fixed charge coverage ratio, and comply with certain limitations on capital expenditures. Events of default under the Term Loan Agreement include, but are not limited to, a breach of certain covenants or any representations or warranties, failure to timely pay any amounts due and owing, the commencement of any bankruptcy or other insolvency proceeding, judgments in excess of certain acceptable amounts, the occurrence of a change in control, certain events related to ERISA matters, impairment of security interests in collateral or invalidity of guarantees or security documents, or a default or event of default under the Revolving Credit Agreement or the Intercreditor Agreement, in each case, with customary exceptions, limitations, grace periods and qualifications. If an event of default occurs, the Term Loan lenders may, among other things, declare all Obligations to be immediately due and payable, together with accrued interest and fees, and exercise remedies under the collateral documents relating to the Term Loan Agreement. On August 3, 2022 (the “Signing Date”), effective as of June 30, 2022, the Company entered into an Amendment to the Term Loan Agreement (the “Term Loan Amendment”) that, among other things, (i) amended and increased the Total Leverage Ratio (as defined in the Term Loan Agreement) applicable to the Company for certain periods, (ii) amends the calculation of Consolidated EBITDA (as defined in the Term Loan Agreement) to include (or “add back”) certain non-recurring losses and expenses relating to projects executed in Jacksonville, Florida, one-time costs and expenses incurred in connection with the Company’s transmission and distribution business unit start-up, and costs and expenses arising out of the Company’s litigation with a designated former executive and his employer (in each case, subject to certain specified dollar limits), (iii) provided for a fee of 1% of the then-outstanding principal balance due upon maturity of the term loan without duplication of fees paid in connection with the Company’s prepayment fee structure, (iv) extended the Company’s existing prepayment fee structure to require upon repayment (a) prior to the first anniversary of the Signing Date, a fee of 3% of the principal amount being repaid, (b) on or after the first anniversary of the Signing Date and prior to the second anniversary of the Signing Date, a fee of 2% of the principal amount being repaid, and (c) on or after the second anniversary of the Signing Date, a fee of 1% of the principal amount being repaid, and (v) provided for the payment of a $0.2 million amendment fee, plus applicable fees and expenses. The Company’s expense related to the Term Loan Amendment was $0.2 million and will be recognized as interest expense over the remaining term of the modified Term Loan Agreement. Letters of Credit and Bonds In line with industry practice, the Company is often required to provide letters of credit and payment and performance surety bonds to customers. These letters of credit and bonds provide credit support and security for the customer if the Company fails to perform its obligations under the applicable contract with such customer. The Revolving Credit Facility provides for a letter of credit sublimit in an amount up to $2.0 million. As of June 30, 2022, the Company had $0.5 million letters of credit outstanding under this sublimit and $0.4 million cash collateralized standby letters of credit outstanding pursuant to its prior revolving credit facility with Wells Fargo Bank, National Association. There were no amounts drawn upon these letters of credit as of June 30, 2022. In addition, as of June 30, 2022 and December 31, 2021, the Company had outstanding payment and performance surety bonds of $61.9 million and $67.6 million, respectively. Deferred Financing Costs and Debt Discount: Deferred financing costs and debt discount is amortized over the terms of the related debt facilities using the straight-line method. The following table summarizes the amortization of deferred financing costs and debt discount related to the Company's debt facilities and recognized in interest expense on the unaudited condensed consolidated statements of operations: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 Term loan $ 112 $ 112 $ 225 $ 225 Debt discount on term loan 50 50 100 100 Revolving credit facility 95 95 190 190 Total $ 257 $ 257 $ 515 $ 515 The following table summarizes unamortized deferred financing costs and debt discount included on the Company's unaudited condensed consolidated balance sheets: (in thousands) Location June 30, 2022 December 31, 2021 Term loan Long-term debt, net $ 1,556 $ 1,781 Debt discount on term loan Long-term debt, net 691 791 Revolving credit facility Other long-term assets 1,319 1,509 Total $ 3,566 $ 4,081 |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 6 Months Ended |
Jun. 30, 2022 | |
FINANCIAL INSTRUMENTS | |
FINANCIAL INSTRUMENTS | NOTE 9 — FINANCIAL INSTRUMENTS Fair Value of Financial Instruments ASC 820–Fair Value Measurement defines fair value as the exit price, which is the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a three-tier fair value hierarchy, which categorizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in the active markets for identical assets and liabilities and the lowest priority to unobservable inputs. The Company’s financial instruments as of June 30, 2022 and December 31, 2021 consisted primarily of cash and cash equivalents, restricted cash, receivables, payables, and debt instruments. The carrying values of these financial instruments approximate their respective fair values, as they are either short-term in nature or carry interest rates that are periodically adjusted to market rates. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 10—COMMITMENTS AND CONTINGENCIES Litigation and Claims The Company is from time-to-time party to various lawsuits, including personal injury claims and other proceedings that arise in the ordinary course of its business. With respect to all such lawsuits, claims and proceedings, the Company records a reserve when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. The Company does not believe that the resolution of any currently pending lawsuits, claims and proceedings, either individually or in the aggregate, will have a material adverse effect on its financial position, results of operations or liquidity. However, the outcomes of any currently pending lawsuits, claims and proceedings cannot be predicted, and therefore, there can be no assurance that this will be the case. The Company completed a bankruptcy filing of its Koontz-Wagner subsidiary on July 11, 2018. This could require the Company to incur legal fees and other expenses related to liabilities from this bankruptcy filing. While the Company does not anticipate these liabilities will have a material adverse effect on its results of operations, cash flows and financial position, and although the statute of limitations has run on certain claims that the Chapter 7 Trustee for the Koontz-Wagner estate might assert, there can be no assurance of the outcome. The filing was for Koontz-Wagner only, not for the Company as a whole, and was completely separate and distinct from the Williams business and operations. For additional information, please refer to “Note 4—Changes in Business” to the unaudited condensed consolidated financial statements. The acquiror of certain assets from a former operating unit of the Company has been named as a defendant in an asbestos personal injury lawsuit and has submitted a claim for indemnification and tendered defense of the matter to the Company. The Company has assumed defense of the matter subject to a reservation of rights and objection to the claim for indemnification. Neither the Company nor its predecessors ever mined, manufactured, produced, or distributed asbestos fiber, the material that allegedly caused the injury underlying this action. The Company does not expect that this claim will have a material adverse effect on its financial position, results of operations or liquidity. Moreover, during 2012, the Company secured insurance coverage that will help to reimburse the defense costs and potential indemnity obligations of its former operating unit relating to these claims. The Company intends to vigorously defend all currently active actions, and it does not anticipate that this action will have a material adverse effect on its financial position, results of operations or liquidity. However, the outcomes of any legal action cannot be predicted and, therefore, there can be no assurance that this will be the case. Insurance The Company maintains insurance coverage for most insurable aspects of its business and operations. The Company’s insurance programs, including, but not limited to, health, general liability, and workers’ compensation, have varying coverage limits depending upon the type of insurance. For the three and six months ended June 30, 2022, insurance expense, including insurance premiums related to the excess claim coverage and claims incurred for continuing operations, was $1.5 million and $3.2 million, respectively. The Company’s unaudited condensed consolidated balance sheets include amounts representing its probable estimated liability related to insurance-related claims that are known and have been asserted against the Company, and for insurance-related claims that are believed to have been incurred but had not yet been reported as of June 30, 2022. As of June 30, 2022, the Company provided $0.9 million in letters of credit and $1.5 million of non-depleting cash collateral as security for possible general liability and workers’ compensation claims. Executive Severance As of June 30, 2022, the Company had outstanding severance arrangements with senior executives. The Company’s maximum commitment under all such arrangements, which would apply if the employees covered by these arrangements were each terminated without cause, was $6.0 million on June 30, 2022. The Company did not accrue executive severance expenses as of June 30, 2022. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2022 | |
STOCK-BASED COMPENSATION. | |
STOCK-BASED COMPENSATION PLANS | NOTE 11—STOCK-BASED COMPENSATION PLANS During the first six months of 2022, the Company granted 291,894 service-based restricted stock awards under the 2015 Equity Incentive Plan (as amended and restated, the “2015 Plan”), at a grant date fair value of $1.85 per share, to its non-employee directors, which vest in full on February 3, 2023. During the first six months of 2022, the Company granted 362,356 service-based restricted stock units to its employees under the 2022 long-term incentive (“LTI”) program and the 2015 Plan at a grant date fair value of $1.99 per share. These service-based restricted stock units can be paid in cash or shares at the election of the Compensation Committee of the Board of Directors and shall vest in equal annual installments over a period of three years. During the first six months of 2022, the Company also granted 724,726 performance-based restricted stock units to its employees under the 2022 LTI program and the 2015 Plan at a grant date fair value of $1.99 per share. The 2022 performance-based restricted stock units have three During the first six months of 2021, the Company granted 307,616 service-based restricted stock units under the 2021 LTI program and the 2015 Plan at a grant date fair value of $3.48 per share. These service-based restricted stock units can be paid in cash or shares at the election of the Compensation Committee of the Board of Directors and shall vest in full on March 31, 2024. Additionally on June 15, 2021, the Company granted an employee 41,666 service-based restricted stock units under the 2015 Plan at a grant date fair value of $6.27 per share. The service-based restricted stock units vested with respect to 25,000 shares of common stock on the date of grant (June 15, 2021), while 8,333 vested on March 31, 2022 and the remaining 8,333 will vest on March 31, 2023. These awards may be paid in cash or shares at the election of the Compensation Committee of the Board of Directors. During the first six months of 2021, the Company also granted performance-based restricted stock units under the 2021 LTI program and the 2015 Plan with an aggregate cash value of approximately $2.2 million, which could be paid in cash or shares at the election of the Compensation Committee of the Board of Directors. The 2021 performance-based restricted stock units have three Additionally on May 17, 2021, the Company granted an employee 37,500 performance-based restricted stock units as an inducement award outside of the 2015 Plan at a grant date fair value of $5.00 per share. The performance-based restricted stock units, if any, vest on March 31, 2024. The performance-based awards have three annual performance periods (fiscal years 2021, 2022 and 2023), with operating income and free cash flow goals (equally weighted) for each year, and threshold performance resulting in awards earned at 50% of the target opportunity and maximum performance resulting in awards earned at 200% of the target. These awards may be paid in cash or shares at the election of the Compensation Committee of the Board of Directors. The Company previously granted (i) performance-based restricted stock units under the 2016 LTI program, which were scheduled to vest if the Company achieved a per share stock price of $5.50 for 30 consecutive trading days prior to August 5, 2021, (ii) performance-based restricted stock units under the 2017 LTI program, which were scheduled to vest if the Company achieved a per share stock price of $6.00 for 30 consecutive trading days prior to March 31, 2021 (pursuant to an extension from the initial vesting date of March 31, 2020, which extension was approved by the Compensation Committee in February 2020), and (iii) performance-based restricted stock units under the 2018 LTI program, which were scheduled to vest if the Company achieved a per share stock price of at least $5.00 for any period of 30 consecutive trading days prior to June 30, 2021 (collectively, the “LTI Performance Awards”). On March 5, 2021, the Compensation Committee of the Board of Directors extended the performance period for each of the LTI Performance Awards to December 31, 2022. In accordance with ASC Topic 718, “Compensation—Stock Compensation” (“ASC 718”), the Company conducted a lattice valuation model in order to revalue the market price for the LTI Performance Awards at the March 5, 2021 modification date. The 2018 LTI program met the market objective by achieving a per share stock price of $5.00 for 30 consecutive days, and approximately 195,240 shares will vest for recipients remaining employed through December 31, 2022. During the first six months of 2021, the Compensation Committee of the Board of Directors approved modifying the 2020 and 2019 performance-based restricted stock units granted in 2020 and 2019. The 2020 and 2019 performance-based restricted stock units did not achieve the 2021 performance objectives. The 2019 performance-based restricted stock units expired because their final performance period was 2021. During the first six months of 2021, the Company’s management analyzed the probability of achieving the 2022 performance objectives for the 2021 and 2020 performance-based restricted stock units granted in 2021 and 2020 and determined that, after comparing the actual year-to-date results to the forecasted results, it is unlikely the Company will achieve the minimum performance metric for the 2022 performance period. This resulted in a $0.3 million adjustment for the 2021 performance-based restricted stock units and an entire reversal of $0.5 million for the 2020 performance-based restricted stock units within the first three months of 2022. The 2020 performance-based restricted stock units will expire after the 2022 performance period and the 2021 performance-based restricted stock units were adjusted to vest at 55% of their original cash value and will be expensed for a total of $0.9 million until the end of the service requisite period of March 31, 2024. While the majority of restricted stock units and awards were granted as equity, in accordance with ASC 718, the Company has one cash-based plan that is classified as a liability. Stock-based compensation expense for the three months ended June 30, 2022 and 2021was $0.6 million and $0.7 million, respectively, and for the six months ended June 30, 2022 and 2021 was $0.6 million and $1.5 million, respectively, and was included in general and administrative expenses on the Company’s unaudited condensed consolidated statements of operations. |
OTHER SUPPLEMENTAL INFORMATION
OTHER SUPPLEMENTAL INFORMATION | 6 Months Ended |
Jun. 30, 2022 | |
OTHER SUPPLEMENTAL INFORMATION | |
OTHER SUPPLEMENTAL INFORMATION | NOTE 12—OTHER SUPPLEMENTARY INFORMATION The following table summarizes other current assets included on the Company's unaudited condensed consolidated balance sheets: (in thousands) June 30, 2022 December 31, 2021 Sales tax receivable - Canada $ 5,217 $ 4,866 Security deposits - real estate 1,978 1,978 Prepaid expenses 1,826 1,136 Unamortized commercial insurance premiums 1,266 2,389 Other current assets 525 680 Total $ 10,812 $ 11,049 The following table summarizes other current liabilities included on the Company's unaudited condensed consolidated balance sheets: (in thousands) June 30, 2022 December 31, 2021 Sales tax payable - Canada $ 5,215 $ 5,135 Short-term lease liability 1,467 1,606 Accrued job cost 1,250 2,433 Legal fees 423 113 Stock Compensation 369 938 Other current liabilities 1,502 792 Total $ 10,226 $ 11,017 The following table summarizes other long-term assets included on the Company's unaudited condensed consolidated balance sheets: (in thousands) June 30, 2022 December 31, 2021 Right-of-use lease assets $ 3,379 $ 1,527 Equity method investment in RCC 1,863 2,521 Unamortized Debt Issuance Cost 1,319 1,509 Other long-term assets 1,079 155 Total $ 7,640 $ 5,712 The following table summarizes other long-term liabilities included on the Company's unaudited condensed consolidated balance sheets: (in thousands) June 30, 2022 December 31, 2021 Long-term lease liability $ 2,379 $ 511 Liability for uncertain tax positions 1,087 1,136 Other long-term liabilities 977 - Total $ 4,443 $ 1,647 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2022 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 13—SUBSEQUENT EVENTS In August 2022, the Company entered into the Term Loan Amendment and the Revolving Credit Amendment, which revised certain terms in the Company’s Term Loan Agreement and Revolving Credit Agreement. On August 3, 2022, the Company entered into the Revolving Credit Amendment, which, among other things, (i) amended the calculation of EBITDA (as defined in the Revolving Credit Agreement), effective as of June 30, 2022, to include (or “add back”) certain non-recurring losses and expenses relating to projects executed in Jacksonville, Florida, one-time costs and expenses incurred in connection with the Company’s transmission and distribution business unit start-up, and costs and expenses arising out of the Company’s litigation with a designated former executive and his employer (in each case, subject to certain specified dollar limits), (ii) permitted advances against certain eligible receivables of one of the Company’s joint ventures (also subject to specified dollar limits), (iii) included provisions that replace the London Interbank Offered Rate (LIBOR) interest rate with customary provisions based on the secured overnight financing rate (SOFR), and (iv) provided for the payment of a $25,000 amendment fee, plus applicable fees and expenses. The $25,000 amendment fee will be expensed as incurred. On August 3, 2022 (the Signing Date), effective as of June 30, 2022, the Company entered into an Amendment to the Term Loan Agreement (the “Term Loan Amendment”) that, among other things, (i) amended and increased the Total Leverage Ratio (as defined in the Term Loan Agreement) applicable to the Company for certain periods, (ii) amended the calculation of Consolidated EBITDA (as defined in the Term Loan Agreement) to include (or “add back”) certain non-recurring losses and expenses relating to projects executed in Jacksonville, Florida, one-time costs and expenses incurred in connection with the Company’s transmission and distribution business unit start-up, and costs and expenses arising out of the Company’s litigation with a designated former executive and his employer (in each case, subject to certain specified dollar limits), (iii) provided for a fee of 1% of the then-outstanding principal balance due upon maturity of the term loan without duplication of fees paid in connection with the Company’s prepayment fee structure, (iv) extended the Company’s existing prepayment fee structure to require upon repayment (a) prior to the first anniversary of the Signing Date, a fee of 3% of the principal amount being repaid, (b) on or after the first anniversary of the Signing Date and prior to the second anniversary of the Signing Date, a fee of 2% of the principal amount being repaid, and (c) on or after the second anniversary of the Signing Date, a fee of 1% of the principal amount being repaid, and (v) provided for the payment of a $0.2 million amendment fee, plus applicable fees and expenses. The Company’s expense related to the Term Loan Amendment was $0.2 million and will be recognized as interest expense over the remaining term of the modified Term Loan Agreement. |
BUSINESS AND BASIS OF PRESENT_2
BUSINESS AND BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Williams Industrial Services Group Inc. (together with its wholly owned subsidiaries, “Williams,” the “Company,” “we,” “us” or “our,” unless the context indicates otherwise) was initially formed in 1998 as GEEG Inc., a Delaware corporation, and in 2001 changed its name to “Global Power Equipment Group Inc.,” and, as part of a reorganization, became the successor to GEEG Holdings, L.L.C., a Delaware limited liability company. Effective June 29, 2018, the Company changed its name to Williams Industrial Services Group Inc. to better align its name with the Williams business, and the Company’s stock trades on the NYSE American LLC under the ticker symbol “WLMS.” Williams has been safely helping power plant owners and operators enhance asset value for more than 50 years. It provides a broad range of construction, maintenance, and support services to infrastructure customers in energy, power, and industrial end markets. The Company’s mission is to be the preferred provider of construction, maintenance, and specialty services through commitment to superior safety performance, focus on innovation, and dedication to delivering unsurpassed value to its customers. Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) on a basis consistent with that used in the Annual Report on Form 10-K for the year ended December 31, 2021, filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) on March 16, 2022 (the “2021 Report”). In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments, including all normal recurring adjustments, necessary to present fairly the unaudited condensed consolidated balance sheets and statements of operations, comprehensive income, stockholders’ equity and cash flows for the periods indicated. All significant intercompany transactions have been eliminated. The December 31, 2021 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. These unaudited condensed consolidated interim financial statements and accompanying notes should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the 2021 Report. Accounting measurements at interim dates inherently involve greater reliance on estimates than at year-end. The results of operations for any interim period are not necessarily indicative of operations to be expected for the full year. The Company reports on a fiscal quarter basis utilizing a “modified” 5-4-4 calendar (modified in that the fiscal year always begins on January 1 and ends on December 31). However, the Company has continued to label its quarterly information using a calendar convention. The effects of this practice are modest and only exist when comparing interim period results. The reporting periods and corresponding fiscal interim periods are as follows: Reporting Interim Period Fiscal Interim Period 2022 2021 Three Months Ended March 31 January 1, 2022 to April 3, 2022 January 1, 2021 to April 4, 2021 Three Months Ended June 30 April 4, 2022 to July 3, 2022 April 5, 2021 to July 4, 2021 Three Months Ended September 30 July 4, 2022 to October 2, 2022 July 5, 2021 to October 3, 2021 |
Adoption of New Accounting Pronouncements | Recently Adopted Accounting Pronouncements The Company did not implement any new accounting pronouncements during the first six months of 2022. However, the Company is currently evaluating the impact of future disclosures that may arise under recent SEC proposals. |
BUSINESS AND BASIS OF PRESENT_3
BUSINESS AND BASIS OF PRESENTATION (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
BUSINESS AND ORGANIZATION | |
Reporting periods and corresponding fiscal interim periods | Reporting Interim Period Fiscal Interim Period 2022 2021 Three Months Ended March 31 January 1, 2022 to April 3, 2022 January 1, 2021 to April 4, 2021 Three Months Ended June 30 April 4, 2022 to July 3, 2022 April 5, 2021 to July 4, 2021 Three Months Ended September 30 July 4, 2022 to October 2, 2022 July 5, 2021 to October 3, 2021 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
LEASES | |
Schedule of components of lease expense | Three Months Ended June 30, Six Months Ended June 30, Lease Cost/(Sublease Income) (in thousands) 2022 2021 2022 2021 Operating lease cost $ 573 $ 538 $ 1,119 $ 1,092 Short-term lease cost 1,611 813 3,228 1,433 Sublease income (15) - (30) - Total lease cost $ 2,169 $ 1,351 $ 4,317 $ 2,525 |
Schedule of right-of use assets and lease liabilities | Lease Assets/Liabilities (in thousands) Balance Sheet Classification June 30, 2022 December 31, 2021 Lease Assets Right-of-use assets Other long-term assets $ 3,379 $ 1,527 Lease Liabilities Short-term lease liabilities Other current liabilities $ 1,467 $ 1,606 Long-term lease liabilities Other long-term liabilities 2,379 511 Total lease liabilities $ 3,846 $ 2,117 |
Schedule of supplemental information | Six Months Ended June 30, (dollars in thousands) 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash used by operating leases $ 1,211 $ 1,154 Right-of-use assets obtained in exchange for new operating lease liabilities 2,854 737 Weighted-average remaining lease term - operating leases 5.70 years 1.38 years Weighted-average remaining lease term - finance leases 1.73 years 2.73 years Weighted-average discount rate - operating leases 9% 9% Weighted-average discount rate - finance leases 9% 9% |
Schedule of remaining lease payments under operating leases | Operating Leases Finance Leases Six Months Ended June 30, (in thousands) Remainder of 2022 $ 1,013 $ 3 2023 905 6 2024 495 1 2025 375 - 2026 381 - Thereafter 1,873 - Total lease payments $ 5,042 $ 10 Less: interest (1,206) - Present value of lease liabilities $ 3,836 $ 10 |
Schedule of remaining lease payments under finance leases | Total remaining lease payments under the Company’s operating and finance leases were as follows: Operating Leases Finance Leases Six Months Ended June 30, (in thousands) Remainder of 2022 $ 1,013 $ 3 2023 905 6 2024 495 1 2025 375 - 2026 381 - Thereafter 1,873 - Total lease payments $ 5,042 $ 10 Less: interest (1,206) - Present value of lease liabilities $ 3,836 $ 10 |
CHANGES IN BUSINESS (Tables)
CHANGES IN BUSINESS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Discontinued operations disposed of by sale | |
Schedule of Financial Information of Disposal Group | (in thousands) June 30, 2022 December 31, 2021 Liabilities: Current liabilities of discontinued operations $ 104 $ 316 Liability for pension obligation 2,287 2,368 Liability for uncertain tax positions 1,236 1,882 Long-term liabilities of discontinued operations 3,523 4,250 Total liabilities of discontinued operations $ 3,627 $ 4,566 Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 General and administrative expenses $ — $ 6 $ — $ 34 Loss (gain) on disposal - Electrical Solutions 17 (228) 17 (228) Interest expense (income) 30 (21) 30 30 Income (loss) from discontinued operations before income tax (47) 243 (47) 164 Income tax expense (benefit) (640) 18 (623) 37 Income (loss) from discontinued operations $ 593 $ 225 $ 576 $ 127 |
REVENUE (Tables)
REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
REVENUE. | |
Schedule of disaggregation of revenue | Disaggregated revenue by type of contract was as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 Cost-plus reimbursement contracts $ 39,771 $ 82,071 $ 94,026 $ 137,664 Fixed-price contracts 16,288 9,500 31,592 14,758 Total $ 56,059 $ 91,571 $ 125,618 $ 152,422 Disaggregated revenue by the geographic area where the work was performed was as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 United States $ 56,059 $ 81,718 $ 120,116 $ 132,908 Canada - 9,853 5,502 19,514 Total $ 56,059 $ 91,571 $ 125,618 $ 152,422 |
Costs and estimated earnings in excess of billings or billings in excess of costs and estimated earnings | Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 Costs incurred on uncompleted contracts $ 53,778 $ 82,218 $ 117,628 $ 136,971 Earnings recognized on uncompleted contracts 2,281 9,353 7,990 15,451 Total 56,059 91,571 125,618 152,422 Less—billings to date (44,865) (80,589) (114,424) (141,440) Net $ 11,194 $ 10,982 $ 11,194 $ 10,982 Contract assets $ 13,483 $ 12,265 $ 13,483 $ 12,265 Contract liabilities (2,289) (1,283) (2,289) (1,283) Net $ 11,194 $ 10,982 $ 11,194 $ 10,982 |
Schedule of transaction price allocated to the remaining performance obligations | (in thousands) Remainder of 2022 2023 2024 Thereafter Total Remaining performance obligations $ 98,141 $ 38,916 $ 10,762 $ 86,484 $ 234,303 |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
EARNINGS (LOSS) PER SHARE | |
Schedule of calculation of basic and diluted earnings per common share | Three Months Ended June 30, Six Months Ended June 30, (in thousands, except share data) 2022 2021 2022 2021 Income (loss) from continuing operations $ (5,311) $ 2,646 $ (7,338) $ 1,063 Basic income (loss) per common share: Weighted average common shares outstanding 26,106,493 25,683,258 26,034,907 25,306,130 Basic income (loss) per common share $ (0.20) $ 0.10 $ (0.28) $ 0.04 Diluted income (loss) per common share: Weighted average common shares outstanding 26,106,493 25,683,258 26,034,907 25,306,130 Diluted effect: Unvested portion of restricted stock units and awards — 753,247 — 762,961 Weighted average diluted common shares outstanding 26,106,493 26,436,505 26,034,907 26,069,091 Diluted income (loss) per common share $ (0.20) $ 0.10 $ (0.28) $ 0.04 |
Schedule anti-dilutive potentially outstanding shares were not included in the calculation of diluted earnings (loss) per share | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Unvested service-based restricted stock and restricted stock unit awards 599,344 — 623,836 — Unvested performance- and market-based restricted stock unit awards 912,675 833,111 912,675 833,111 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
INCOME TAXES | |
Schedule of effective income tax expense rate for continuing operations | Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Effective income tax rate for continuing operations 3.1% 2.8% (0.8)% 19.8% |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
DEBT | |
Schedule of debt | (in thousands) June 30, 2022 December 31, 2021 Short-term borrowings $ 10,223 $ 676 Term loan, current portion of long-term debt 1,050 1,050 Current debt $ 11,273 $ 1,726 Term loan, noncurrent portion of long-term debt $ 32,375 $ 32,900 Debt discount (691) (791) Unamortized deferred financing costs (1,556) (1,781) Long-term debt, net $ 30,128 $ 30,328 Total debt, net $ 41,401 $ 32,054 |
Schedule of deferred financing costs amortized to Interest Expense | Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2022 2021 2022 2021 Term loan $ 112 $ 112 $ 225 $ 225 Debt discount on term loan 50 50 100 100 Revolving credit facility 95 95 190 190 Total $ 257 $ 257 $ 515 $ 515 |
Schedule of unamortized deferred financing costs | (in thousands) Location June 30, 2022 December 31, 2021 Term loan Long-term debt, net $ 1,556 $ 1,781 Debt discount on term loan Long-term debt, net 691 791 Revolving credit facility Other long-term assets 1,319 1,509 Total $ 3,566 $ 4,081 |
OTHER SUPPLEMENTAL INFORMATION
OTHER SUPPLEMENTAL INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
OTHER SUPPLEMENTAL INFORMATION | |
Schedule of other current assets | (in thousands) June 30, 2022 December 31, 2021 Sales tax receivable - Canada $ 5,217 $ 4,866 Security deposits - real estate 1,978 1,978 Prepaid expenses 1,826 1,136 Unamortized commercial insurance premiums 1,266 2,389 Other current assets 525 680 Total $ 10,812 $ 11,049 |
Schedule of other current liabilities | (in thousands) June 30, 2022 December 31, 2021 Sales tax payable - Canada $ 5,215 $ 5,135 Short-term lease liability 1,467 1,606 Accrued job cost 1,250 2,433 Legal fees 423 113 Stock Compensation 369 938 Other current liabilities 1,502 792 Total $ 10,226 $ 11,017 |
Schedule of other long-term assets | (in thousands) June 30, 2022 December 31, 2021 Right-of-use lease assets $ 3,379 $ 1,527 Equity method investment in RCC 1,863 2,521 Unamortized Debt Issuance Cost 1,319 1,509 Other long-term assets 1,079 155 Total $ 7,640 $ 5,712 |
Schedule of other long-term liabilities | (in thousands) June 30, 2022 December 31, 2021 Long-term lease liability $ 2,379 $ 511 Liability for uncertain tax positions 1,087 1,136 Other long-term liabilities 977 - Total $ 4,443 $ 1,647 |
LEASES (Details)
LEASES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |
Sep. 02, 2021 | Jun. 30, 2022 | Jun. 30, 2022 | |
Lessee, Lease, Description [Line Items] | |||
Leases contain renewal options | true | ||
Lease agreement term | 10 years | ||
Lease Liabilities | $ 3,300,000 | ||
Lease liability payment due | $ 2,200,000 | ||
Sublease income | $ 15,000 | $ 30,000 | |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 1 year | 1 year | |
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 10 years | 10 years |
LEASES - Lease Cost (Details)
LEASES - Lease Cost (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Components of lease expense: | ||||
Operating lease cost | $ 573,000 | $ 538,000 | $ 1,119,000 | $ 1,092,000 |
Short-term lease cost | 1,611,000 | 813,000 | 3,228,000 | 1,433,000 |
Sublease income | (15,000) | (30,000) | ||
Total lease cost | $ 2,169,000 | $ 1,351,000 | $ 4,317,000 | $ 2,525,000 |
LEASES - Right-of use Assets an
LEASES - Right-of use Assets and Lease Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Right-of-use assets | $ 3,379 | $ 1,527 |
Short-term lease liabilities | 1,467 | 1,606 |
Long-term lease liabilities | 2,379 | 511 |
Total lease liabilities | 3,846 | 2,117 |
Other long-term assets | ||
Right-of-use assets | $ 3,379 | $ 1,527 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets, Noncurrent | Other Assets, Noncurrent |
Other current liabilities | ||
Short-term lease liabilities | $ 1,467 | $ 1,606 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current | Other Liabilities, Current |
Other long-term liabilities | ||
Long-term lease liabilities | $ 2,379 | $ 511 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
LEASES - Supplemental Informati
LEASES - Supplemental Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
LEASES | ||
Cash paid for amounts included in the measurement of lease liabilities: Operating cash used by operating leases | $ 1,211 | $ 1,154 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 2,854 | $ 737 |
Weighted-average remaining lease term - operating leases | 5 years 8 months 12 days | 1 year 4 months 17 days |
Weighted-average remaining lease term - finance leases | 1 year 8 months 23 days | 2 years 8 months 23 days |
Weighted-average discount rate - operating leases | 9% | 9% |
Weighted-average discount rate - finance leases | 9% | 9% |
LEASES - Remaining Lease Paymen
LEASES - Remaining Lease Payments (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Operating leases maturities: | |
Remainder of 2022 | $ 1,013 |
2023 | 905 |
2024 | 495 |
2025 | 375 |
2026 | 381 |
Thereafter | 1,873 |
Total lease payments | 5,042 |
Less: interest | (1,206) |
Present value of lease liabilities | 3,836 |
Finance leases maturities: | |
Remainder of 2022 | 3 |
2023 | 6 |
2024 | 1 |
Total lease payments | 10 |
Present value of lease liabilities | $ 10 |
CHANGES IN BUSINESS - Discontin
CHANGES IN BUSINESS - Discontinued Operation and Disposition (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
May 12, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Jul. 11, 2018 | |
Liabilities: | |||||||
Current liabilities of discontinued operations | $ 104 | $ 104 | $ 316 | ||||
Long-term liabilities of discontinued operations | 3,523 | 3,523 | 4,250 | ||||
Income (loss) before income taxes | |||||||
Interest expense, net | 1,261 | $ 1,213 | 2,480 | $ 2,506 | |||
Income (loss) from discontinued operations before income tax | (47) | 243 | (47) | 164 | |||
Income tax expense (benefit) | (640) | 18 | (623) | 37 | |||
Income (loss) from discontinued operations | 593 | 225 | 576 | 127 | |||
Discontinued operations, disposed of by means other than sale | Electrical Solutions | Pension | |||||||
Liabilities: | |||||||
Liability for pension obligation | $ 2,900 | ||||||
Decrease in liability for pension obligation | $ 300 | ||||||
Income (loss) before income taxes | |||||||
Expected Periodic Payment | $ 300 | ||||||
Discontinued operations disposed of by sale | |||||||
Income (loss) before income taxes | |||||||
General and administrative expenses | 6 | 34 | |||||
Interest expense, net | 30 | (21) | 30 | 30 | |||
Income (loss) from discontinued operations before income tax | (47) | 243 | (47) | 164 | |||
Income tax expense (benefit) | (640) | 18 | (623) | 37 | |||
Income (loss) from discontinued operations | 593 | 225 | 576 | 127 | |||
Discontinued operations disposed of by sale | Electrical Solutions And Mechanical Solutions | |||||||
Assets and liabilities | |||||||
Assets of discontinued operations | 0 | 0 | 0 | ||||
Liabilities: | |||||||
Current liabilities of discontinued operations | 104 | 104 | 316 | ||||
Liability for pension obligation | 2,287 | 2,287 | 2,368 | ||||
Liability for uncertain tax positions | 1,236 | 1,236 | 1,882 | ||||
Long-term liabilities of discontinued operations | 3,523 | 3,523 | 4,250 | ||||
Total liabilities of discontinued operations | 3,627 | 3,627 | $ 4,566 | ||||
Discontinued operations disposed of by sale | Electrical Solutions | |||||||
Income (loss) before income taxes | |||||||
Loss (gain) on disposal - Electrical Solutions | $ 17 | $ (228) | $ 17 | $ (228) |
REVENUE - Disaggregation of rev
REVENUE - Disaggregation of revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of revenue | ||||
Revenue | $ 56,059 | $ 91,571 | $ 125,618 | $ 152,422 |
Variable consideration | ||||
Maximum limited warranty term | 2 years | |||
U.S. | ||||
Disaggregation of revenue | ||||
Revenue | 56,059 | 81,718 | $ 120,116 | 132,908 |
Canada | ||||
Disaggregation of revenue | ||||
Revenue | 9,853 | 5,502 | 19,514 | |
Cost-plus reimbursement contracts | ||||
Disaggregation of revenue | ||||
Revenue | 39,771 | 82,071 | 94,026 | 137,664 |
Fixed-price contracts | ||||
Disaggregation of revenue | ||||
Revenue | $ 16,288 | $ 9,500 | $ 31,592 | $ 14,758 |
REVENUE - Contract assets and t
REVENUE - Contract assets and the contract liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Changes in the contract assets and the contract liabilities | |||||
Costs incurred on uncompleted contracts | $ 53,778 | $ 82,218 | $ 117,628 | $ 136,971 | |
Earnings recognized on uncompleted contracts | 2,281 | 9,353 | 7,990 | 15,451 | |
Total | 56,059 | 91,571 | 125,618 | 152,422 | |
Less - billings to date | (44,865) | (80,589) | (114,424) | (141,440) | |
Net | 11,194 | 10,982 | 11,194 | 10,982 | |
Contract assets | 13,483 | 12,265 | 13,483 | 12,265 | $ 12,683 |
Contract liabilities | (2,289) | $ (1,283) | (2,289) | $ (1,283) | $ (3,412) |
Revenue recognized from contracts in progress liability balance at December 31, 2021 | $ 700 | $ 2,100 |
REVENUE - Remaining Performance
REVENUE - Remaining Performance Obligations (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Transaction price allocated to the remaining performance obligations | |
Remaining performance obligation | $ 234,303 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-01 | |
Transaction price allocated to the remaining performance obligations | |
Remaining performance obligation | $ 98,141 |
Expected timing of satisfaction | 6 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Transaction price allocated to the remaining performance obligations | |
Remaining performance obligation | $ 38,916 |
Expected timing of satisfaction | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Transaction price allocated to the remaining performance obligations | |
Remaining performance obligation | $ 10,762 |
Expected timing of satisfaction | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Transaction price allocated to the remaining performance obligations | |
Remaining performance obligation | $ 86,484 |
Expected timing of satisfaction | 1 year |
EARNINGS (LOSS) PER SHARE (Deta
EARNINGS (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
EARNINGS PER SHARE | |||||
Common stock, shares outstanding | 26,427,635 | 25,915,502 | 26,427,635 | 25,915,502 | 25,939,621 |
Net income (basic and diluted): | |||||
Income (loss) from continuing operations | $ (5,311) | $ 2,646 | $ (7,338) | $ 1,063 | |
Basic income (loss) per common share: | |||||
Weighted average common shares outstanding | 26,106,493 | 25,683,258 | 26,034,907 | 25,306,130 | |
Basic income (loss) per common share | $ (0.20) | $ 0.10 | $ (0.28) | $ 0.04 | |
Diluted income (loss) per common share: | |||||
Weighted average common shares outstanding | 26,106,493 | 25,683,258 | 26,034,907 | 25,306,130 | |
Diluted effect: | |||||
Unvested portion of restricted stock units and awards | 753,247 | 762,961 | |||
Weighted average diluted common shares outstanding | 26,106,493 | 26,436,505 | 26,034,907 | 26,069,091 | |
Diluted income (loss) per common share | $ (0.20) | $ 0.10 | $ (0.28) | $ 0.04 | |
Restricted Stock | |||||
EARNINGS PER SHARE | |||||
Unvested restricted stock included in reportable shares | 321,142 | 215,956 | 321,142 | 215,956 |
EARNINGS (LOSS) PER SHARE - Ant
EARNINGS (LOSS) PER SHARE - Antidilutive (Details) - Restricted Stock - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Unvested Service-based restricted stock and unit awards | ||||
Anti-dilutive shares | 599,344 | 623,836 | ||
Unvested performance- and market-based restricted stock unit awards | ||||
Anti-dilutive shares | 912,675 | 833,111 | 912,675 | 833,111 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income tax expense (benefit) | $ (171) | $ 77 | $ 58 | $ 262 |
Effective income tax rate for continuing operations | 3.10% | 2.80% | (0.80%) | 19.80% |
Tax expense (benefit) computed at the maximum U.S. statutory rate, as a percent | 21% | |||
Increase (decrease) in Income Taxes | $ 200 | |||
Deferred tax liabilities, indefinite-lived intangibles | $ 2,400 | 2,400 | ||
Amount of future financial taxable income needed to realize deferred tax assets | 12,400 | 12,400 | ||
Amount of future financial taxable income needed to realize deferred tax assets | 291,300 | $ 273,400 | 291,300 | $ 273,400 |
Indefinite lived deferred tax assets attributable to net operating losses | 6,800 | 6,800 | ||
Increase (decrease) in indefinite-lived deferred tax assets related to interest expense | 3,300 | |||
Deferred Federal Employer Payroll Taxes, Coronavirus Aid, Relief and Economic Security Act | 4,900 | 4,900 | ||
Deferred income tax liabilities related to indefinite-lived intangibles | 300 | 300 | ||
Long Term Liabilities Of Discontinued Operations And Other Long Term Liabilities | ||||
Unrecognized tax benefits | 2,300 | 2,900 | 2,300 | 2,900 |
Accrued interest and penalties related to uncertain income tax positions | 1,100 | 1,100 | ||
Long Term Liabilities Of Discontinued Operations And Other Long Term Liabilities | Discontinued Operations | ||||
Unrecognized tax benefits | 1,200 | $ 1,800 | 1,200 | $ 1,800 |
Accrued interest and penalties related to uncertain income tax positions | 500 | 500 | ||
Canada | ||||
Undistributed earnings of the foreign subsidiaries | 5,900 | $ 5,900 | ||
US-Canada treaty rate | 5% | |||
Deferred tax liability, undistributed foreign earnings | $ 300 | $ 300 |
DEBT (Details)
DEBT (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Aug. 03, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Dec. 16, 2020 | |
Debt | |||||||
Current portion of term loan | $ 1,050,000 | $ 1,050,000 | $ 1,050,000 | ||||
Current debt | 11,273,000 | 11,273,000 | 1,726,000 | ||||
Debt discount | (50,000) | $ (50,000) | (100,000) | $ (100,000) | |||
Unamortized deferred financing fees | (3,566,000) | (3,566,000) | (4,081,000) | ||||
Long-term debt, net | 30,128,000 | 30,128,000 | 30,328,000 | ||||
Total debt, net | 41,401,000 | 41,401,000 | 32,054,000 | ||||
Amounts drawn upon letters of credit | 0 | 0 | |||||
Cash collateral for letters of credit | 900,000 | 900,000 | |||||
Amortization of deferred financing costs | 415,000 | 415,000 | |||||
Amortization of deferred financing costs excluding those costs written off upon extinguishment of debt. | 257,000 | 257,000 | 515,000 | 515,000 | |||
Long-term debt, net | |||||||
Debt | |||||||
Debt discount | 691,000 | $ 691,000 | 791,000 | ||||
Term Loan Facility | |||||||
Debt | |||||||
Default spread on interest rate (as a percent) | 2% | ||||||
Threshold excess cash flow | $ 500,000 | ||||||
Term Loan Facility | Minimum | |||||||
Debt | |||||||
Outstanding principal that can be prepaid in whole or in part | 1,000,000 | 1,000,000 | |||||
Revolving Credit Facility | |||||||
Debt | |||||||
Cash collateral for letters of credit | 400,000 | 400,000 | |||||
Revolving Credit Facility | Minimum | |||||||
Debt | |||||||
Required minimum prepayment amount | 0 | ||||||
Term loan | |||||||
Debt | |||||||
Maximum borrowing capacity | $ 50,000,000 | ||||||
Current portion of term loan | 1,050,000 | 1,050,000 | 1,050,000 | ||||
Term loan, noncurrent portion of long-term debt | 32,375,000 | 32,375,000 | 32,900,000 | ||||
Debt discount | (691,000) | (691,000) | (791,000) | ||||
Unamortized deferred financing fees | (1,556,000) | (1,556,000) | (1,781,000) | ||||
Total debt, net | 33,400,000 | 33,400,000 | |||||
Amortization of deferred financing costs excluding those costs written off upon extinguishment of debt. | 112,000 | 112,000 | 225,000 | 225,000 | |||
Scheduled maturities of the New Centre Lane Facility | |||||||
Term loan | 32,375,000 | $ 32,375,000 | 32,900,000 | ||||
Term loan | If Total Leverage Ratio is Greater Than 3.00 | |||||||
Debt | |||||||
Interest rate if required threshold leverage ratio is maintained | 50% | ||||||
Term loan | If Total Leverage Ratio is Equal to or Less Than 3.00 and Greater Than 2.00 | |||||||
Debt | |||||||
Interest rate if required threshold leverage ratio is maintained | 25% | ||||||
Term loan | Minimum | |||||||
Debt | |||||||
Threshold total leverage ratio under debt instrument | 2.50 | ||||||
Term loan | Minimum | If Total Leverage Ratio is Greater Than 3.00 | |||||||
Debt | |||||||
Threshold total leverage ratio under debt instrument | 3 | ||||||
Term loan | Minimum | If Total Leverage Ratio is Equal to or Less Than 3.00 and Greater Than 2.00 | |||||||
Debt | |||||||
Threshold total leverage ratio under debt instrument | 2 | ||||||
Term loan | Maximum | |||||||
Debt | |||||||
Number of days within which obligations must be prepaid subject to thresholds (in days) | 120 days | ||||||
Default spread on interest rate (as a percent) | 2.50% | ||||||
Term loan | Maximum | If Total Leverage Ratio is Equal to or Less Than 3.00 and Greater Than 2.00 | |||||||
Debt | |||||||
Threshold total leverage ratio under debt instrument | 3 | ||||||
Term loan | Long-term debt, net | |||||||
Debt | |||||||
Unamortized deferred financing fees | (1,556,000) | $ (1,556,000) | (1,781,000) | ||||
Term loan | Base Rate loans | |||||||
Debt | |||||||
Interest rate percentage (as a percent) | 9% | ||||||
Term loan | LIBOR-based loans | |||||||
Debt | |||||||
Interest rate percentage (as a percent) | 8.50% | ||||||
Term loan | LIBOR-based loans | Minimum | |||||||
Debt | |||||||
Floor rate (as a percent) | 1% | ||||||
Term loan | Subsequent Event | |||||||
Debt | |||||||
Payments of financing costs | $ 200,000 | ||||||
Debt instrument provision percentage | 1% | ||||||
Debt Instrument provision percentage year one | 3% | ||||||
Debt Instrument provision percentage year two | 2% | ||||||
Debt Instrument provision percentage year three | 1% | ||||||
Closing Date Term Loan | |||||||
Debt | |||||||
Maximum borrowing capacity | 35,000,000 | ||||||
Delayed Draw Term Loan Facility | |||||||
Debt | |||||||
Maximum borrowing capacity | 15,000,000 | ||||||
Senior Secured Asset-Based Revolving Line Of Credit | |||||||
Debt | |||||||
Maximum borrowing capacity | $ 30,000,000 | ||||||
Current debt | 10,223,000 | $ 10,223,000 | 676,000 | ||||
Floor rate (as a percent) | 1% | ||||||
Closing fee under the line of credit facility | $ 200,000 | ||||||
Unused line fee (as a percent) | 0.25% | ||||||
Collateral monitoring fee | $ 2,500 | ||||||
Early termination fee | 2% | ||||||
Senior Secured Asset-Based Revolving Line Of Credit | If Early Termination Occurs on or Prior to First Anniversary of Closing Date | |||||||
Debt | |||||||
Early termination fee | 1% | ||||||
Senior Secured Asset-Based Revolving Line Of Credit | If Early Termination Occurs After First Anniversary of Closing Date | |||||||
Debt | |||||||
Fronting fee | 0.25% | ||||||
Senior Secured Asset-Based Revolving Line Of Credit | Other Noncurrent Assets | |||||||
Debt | |||||||
Unamortized deferred financing fees | (1,319,000) | $ (1,319,000) | (1,509,000) | ||||
Senior Secured Asset-Based Revolving Line Of Credit | Base Rate loans | |||||||
Debt | |||||||
Interest rate percentage (as a percent) | 1.25% | ||||||
Senior Secured Asset-Based Revolving Line Of Credit | LIBOR-based loans | |||||||
Debt | |||||||
Interest rate percentage (as a percent) | 2.25% | ||||||
Senior Secured Asset-Based Revolving Line Of Credit | Canadian Dollar Offered Rate | |||||||
Debt | |||||||
Floor rate (as a percent) | 1% | ||||||
Default spread on interest rate (as a percent) | 2% | ||||||
Swing Loan Member | |||||||
Debt | |||||||
Maximum borrowing capacity | 3,000,000 | $ 3,000,000 | |||||
Letters of credit | |||||||
Debt | |||||||
Maximum borrowing capacity | 2,000,000 | 2,000,000 | |||||
Outstanding borrowings | 500,000 | 500,000 | |||||
Canadian Dollar Loans | |||||||
Debt | |||||||
Maximum borrowing capacity | 5,000,000 | 5,000,000 | |||||
Revolving Credit Facility | |||||||
Debt | |||||||
Amortization of deferred financing costs | 95,000 | $ 95,000 | 190,000 | $ 190,000 | |||
Payment Surety Bond | |||||||
Debt | |||||||
Outstanding surety bond | $ 61,900,000 | $ 61,900,000 | |||||
Performance Bond | |||||||
Debt | |||||||
Outstanding surety bond | $ 67,600,000 | ||||||
Amendment of Revolving Credit Facility | Subsequent Event | |||||||
Debt | |||||||
Payments of financing costs | $ 25,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | |
COMMITMENTS AND CONTINGENCIES | ||
Employee severance benefits | $ 6 | $ 6 |
Insurance expense | 1.5 | 3.2 |
Cash collateral for letters of credit | 0.9 | 0.9 |
Non-depleting cash collateral | $ 1.5 | $ 1.5 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 15, 2021 $ / shares shares | May 17, 2021 $ / shares shares | Jun. 30, 2022 USD ($) D item $ / shares shares | Mar. 31, 2022 shares | Jun. 30, 2021 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) D item $ / shares shares | Jun. 30, 2021 USD ($) $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock-based compensation | $ | $ 577 | $ 1,460 | |||||
Stock-based compensation expense | $ | $ 600 | $ 700 | $ 600 | $ 1,500 | |||
2015 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting shares of restricted stock awards | shares | 25,000 | 8,333 | |||||
Unvested restricted stock included in reportable shares | shares | 8,333 | ||||||
2016 LTI program | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock price per share | $ / shares | $ 5.50 | $ 5.50 | |||||
Number of consecutive trading days | D | 30 | 30 | |||||
2017 LTI program | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock price per share | $ / shares | $ 6 | $ 6 | |||||
Number of consecutive trading days | D | 30 | 30 | |||||
2018 LTI program | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting shares of restricted stock awards | shares | 195,240 | ||||||
Stock price per share | $ / shares | $ 5 | $ 5 | |||||
Number of consecutive trading days | D | 30 | 30 | |||||
2018 LTI program | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock price per share | $ / shares | $ 5 | $ 5 | |||||
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Unvested restricted stock included in reportable shares | shares | 321,142 | 215,956 | 321,142 | 215,956 | |||
Restricted Stock | 2022 LTI & 2015 Plan | Performance Vesting | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Annual performance objective term | 3 years | ||||||
Restricted Stock | 2022 LTI & 2015 Plan | Performance Vesting | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award payouts | 50% | ||||||
Restricted Stock | 2022 LTI & 2015 Plan | Performance Vesting | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award payouts | 200% | ||||||
Restricted Stock | Modification to 2021 LTI | Performance Vesting | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Cumulative effect of compensation expense reversal | $ | $ 300 | ||||||
Adjusted vesting percentage on original cash value | 55% | ||||||
Unrecognized compensation expense related to unvested restricted stock award | $ | $ 900 | $ 900 | |||||
Restricted Stock | Modification to 2020 Long-term Incentive Program | Performance Vesting | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Cumulative effect of compensation expense reversal | $ | $ 500 | ||||||
Restricted Stock | 2015 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | shares | 41,666 | ||||||
Weighted average grant date fair value | $ / shares | $ 6.27 | ||||||
Restricted Stock | 2021 long-term incentive program and 2015 plans | Unvested Service-based restricted stock and unit awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | shares | 307,616 | ||||||
Weighted average grant date fair value | $ / shares | $ 3.48 | $ 3.48 | |||||
Restricted Stock | 2021 long-term incentive program and 2015 plans | Performance Vesting | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Annual performance objective term | 3 years | ||||||
Aggregate cash Value | $ | $ 2,200 | ||||||
Restricted Stock | 2021 long-term incentive program and 2015 plans | Performance Vesting | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award payouts | 50% | 50% | |||||
Restricted Stock | 2021 long-term incentive program and 2015 plans | Performance Vesting | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award payouts | 200% | 200% | |||||
Restricted Stock | Outside of 2015 Plan | Performance and Service Vesting | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | shares | 37,500 | ||||||
Weighted average grant date fair value | $ / shares | $ 5 | ||||||
Restricted Stock | Non-employee director | 2015 Equity Incentive Plan | Unvested Service-based restricted stock and unit awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | shares | 291,894 | ||||||
Weighted average grant date fair value | $ / shares | $ 1.85 | $ 1.85 | |||||
Restricted Stock | Employees | 2022 LTI & 2015 Plan | Unvested Service-based restricted stock and unit awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | shares | 362,356 | ||||||
Weighted average grant date fair value | $ / shares | 1.99 | $ 1.99 | |||||
Restricted Stock | Employees | 2022 LTI & 2015 Plan | Performance Vesting | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Granted (in shares) | shares | 724,726 | ||||||
Weighted average grant date fair value | $ / shares | $ 1.99 | $ 1.99 | |||||
Cash-based Awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of cash based awards | item | 1 | 1 |
OTHER SUPPLEMENTAL INFORMATIO_2
OTHER SUPPLEMENTAL INFORMATION - Other current assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Security deposits - real estate | $ 1,978 | $ 1,978 |
Prepaid expenses | 1,826 | 1,136 |
Unamortized commercial insurance premiums | 1,266 | 2,389 |
Other current assets | 525 | 680 |
Total | 10,812 | 11,049 |
Canada | ||
Sales tax receivable | $ 5,217 | $ 4,866 |
OTHER SUPPLEMENTAL INFORMATIO_3
OTHER SUPPLEMENTAL INFORMATION - Other current liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
OTHER SUPPLEMENTAL INFORMATION. | ||
Sales tax payable - Canada | $ 5,215 | $ 5,135 |
Short-term lease liability | 1,467 | 1,606 |
Accrued job cost | 1,250 | 2,433 |
Legal fees | 423 | 113 |
Stock Compensation | 369 | 938 |
Other accrued liabilities | 1,502 | 792 |
Total | $ 10,226 | $ 11,017 |
OTHER SUPPLEMENTAL INFORMATIO_4
OTHER SUPPLEMENTAL INFORMATION - Other long-term assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Right-of-use lease assets | $ 3,379 | $ 1,527 |
Unamortized Debt Issuance Cost | 1,319 | 1,509 |
Other long-term assets | 1,079 | 155 |
Total | 7,640 | 5,712 |
RCC | ||
Equity method investment in RCC | $ 1,863 | $ 2,521 |
OTHER SUPPLEMENTAL INFORMATIO_5
OTHER SUPPLEMENTAL INFORMATION - Other long-term liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
OTHER SUPPLEMENTAL INFORMATION | ||
Long-term lease liability | $ 2,379 | $ 511 |
Liability for uncertain tax positions. | 1,087 | 1,136 |
Other long-term liabilities | 977 | |
Total | $ 4,443 | $ 1,647 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent Event | Aug. 03, 2022 USD ($) |
Amendment of Revolving Credit Facility | |
Subsequent Event [Line Items] | |
Payments of financing costs | $ 25,000 |
Term loan | |
Subsequent Event [Line Items] | |
Payments of financing costs | $ 200,000 |
Debt instrument provision percentage | 1% |
Debt Instrument provision percentage year one | 3% |
Debt Instrument provision percentage year two | 2% |
Debt Instrument provision percentage year three | 1% |