Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | May 09, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | AquaVenture Holdings Ltd | |
Entity Central Index Key | 1,422,841 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 26,408,528 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current Assets: | ||
Cash and cash equivalents | $ 89,918 | $ 95,334 |
Restricted cash | 166 | 166 |
Trade receivables, net of allowances of $981 and $1,166, respectively | 11,939 | 15,473 |
Inventory | 5,572 | 6,246 |
Prepaid expenses and other current assets | 7,836 | 6,401 |
Total current assets | 115,431 | 123,620 |
Property, plant and equipment, net | 114,456 | 116,092 |
Construction in progress | 9,759 | 9,398 |
Long-term contract costs | 85,745 | 87,512 |
Restricted cash | 6,003 | 5,895 |
Other assets | 43,254 | 44,311 |
Deferred tax asset | 353 | 515 |
Intangible assets, net | 50,091 | 51,330 |
Goodwill | 98,023 | 98,023 |
Total assets | 523,115 | 536,696 |
Current Liabilities: | ||
Accounts payable | 3,123 | 3,880 |
Accrued liabilities | 9,859 | 13,075 |
Current portion of long-term debt | 35,187 | 27,963 |
Deferred revenue | 2,452 | 2,820 |
Total current liabilities | 50,621 | 47,738 |
Long-term debt | 101,782 | 115,753 |
Deferred tax liability | 3,466 | 2,874 |
Other long-term liabilities | 3,013 | 2,825 |
Total liabilities | 158,882 | 169,190 |
Commitments and contingencies (see Note 7) | ||
Shareholders' Equity | ||
Ordinary shares, no par value, 250,000 shares authorized; 26,388 shares issued and outstanding at March 31, 2017 and December 31, 2016 | ||
Additional paid-in capital | 560,995 | 558,141 |
Accumulated deficit | (196,762) | (190,635) |
Total shareholders' equity | 364,233 | 367,506 |
Total liabilities and shareholders' equity | $ 523,115 | $ 536,696 |
UNAUDITED CONDENSED CONSOLIDAT3
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Allowances | $ 981 | $ 1,166 |
Common stock par value | $ 0 | $ 0 |
Common stock authorized | 250,000 | 250,000 |
Common stock issued | 26,388 | 26,388 |
Common stock outstanding | 26,388 | 26,388 |
UNAUDITED CONDENSED CONSOLIDAT4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Revenues: | |||
Bulk water | $ 14,215 | $ 13,491 | |
Rental | 12,804 | 11,706 | |
Other | 1,989 | 1,932 | |
Total revenues | 29,008 | 27,129 | |
Cost of revenues: | |||
Bulk water | 8,824 | 7,663 | |
Rental | 5,754 | 5,464 | |
Other | 1,136 | 1,039 | |
Total cost of revenues | 15,714 | 14,166 | |
Gross profit | 13,294 | 12,963 | |
Selling, general and administrative expenses | 16,488 | 13,697 | |
Loss from operations | (3,194) | (734) | |
Other expense: | |||
Interest expense, net | (1,815) | (2,580) | |
Other expense, net | (182) | (46) | |
Loss before income tax expense | (5,191) | (3,360) | |
Income tax expense | 935 | 628 | |
Net loss | $ (6,126) | $ (3,988) | |
Loss per share – basic and diluted | [1] | $ (0.23) | |
Weighted-average shares outstanding – basic and diluted | 26,386 | ||
[1] | Represents loss per share and weighted-average shares outstanding for the period following the Corporate Reorganization and IPO. There were no ordinary shares outstanding prior to October 6, 2016 and, therefore, no loss per share information has been presented for any period prior to that date. |
UNAUDITED CONDENSED CONSOLIDAT5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - shares shares in Thousands | Mar. 31, 2017 | Dec. 31, 2016 | Oct. 05, 2016 |
Common stock outstanding | 26,388 | 26,388 | |
Ordinary Share Units | |||
Common stock outstanding | 0 |
UNAUDITED CONDENSED CONSOLIDAT6
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (6,126) | $ (3,988) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 7,807 | 7,264 |
Adjustment to asset retirement obligation | 12 | 10 |
Share-based compensation expense | 2,854 | 683 |
Provision for bad debts | 30 | 311 |
Deferred income tax provision | 754 | 497 |
Inventory adjustment | 60 | 56 |
Loss on disposal of assets | 268 | 192 |
Amortization of debt financing fees | 209 | 184 |
Adjustment to acquisition contingent consideration | 21 | |
Accretion of debt | 26 | 91 |
Other | (6) | |
Change in operating assets and liabilities: | ||
Trade receivables | 3,503 | 2,286 |
Inventory | 551 | 195 |
Prepaid expenses and other current assets | (1,323) | (725) |
Other assets | (602) | (438) |
Current liabilities | (2,926) | (1,468) |
Long-term liabilities | 203 | 285 |
Net cash provided by operating activities | 5,300 | 5,450 |
Cash flows from investing activities: | ||
Capital expenditures | (3,153) | (5,447) |
Long-term contract expenditures | (252) | (799) |
Net cash paid for businesses acquired | (186) | (100) |
Principal collected on note receivable | 1,094 | |
Net cash used in investing activities | (2,497) | (6,346) |
Cash flows from financing activities: | ||
Proceeds from long-term debt | 15,000 | |
Payments of long-term debt | (6,944) | (3,821) |
Payment of debt financing fees | (98) | |
Proceeds from exercise of stock options | 2 | |
Shares withheld to cover minimum tax withholdings on equity awards | (2) | |
Issuance costs from issuance of ordinary shares in IPO | (1,167) | |
Net cash (used in) provided by financing activities | (8,111) | 11,081 |
Change in cash, cash equivalents and restricted cash | (5,308) | 10,185 |
Cash, cash equivalents and restricted cash at beginning of period | 101,395 | 25,026 |
Cash, cash equivalents and restricted cash at end of period | $ 96,087 | $ 35,211 |
Description of the Business
Description of the Business | 3 Months Ended |
Mar. 31, 2017 | |
Description of the business | |
Description of the business | 1. Description of the Business AquaVenture Holdings Limited is a British Virgin Islands (“BVI”) company, which was formed on June 17, 2016 for the purpose of completing an initial public offering (“IPO”) as the SEC registrant and carrying on the business of AquaVenture Holdings LLC and its subsidiaries. AquaVenture Holdings Limited and its subsidiaries (collectively, “AquaVenture” or the “Company”) provides its customers Water‑as‑a‑Service (“WAAS”) solutions through two operating platforms: Seven Seas Water and Quench. Both operations are critical to AquaVenture, which is headquartered in the British Virgin Islands. Seven Seas Water offers WAAS solutions by providing outsourced desalination and wastewater treatment services for governmental, municipal, industrial and hospitality customers. These solutions utilize reverse osmosis and other purification technologies to produce potable and high purity industrial process water in high volumes for customers operating in regions with limited access to potable water. Through this outsourced service model, Seven Seas Water assumes responsibility for designing, financing, constructing, operating and maintaining the water treatment facilities. In exchange, Seven Seas Water enters into long‑term agreements to sell to customers agreed‑upon quantities of water that meet specified water quality standards. Seven Seas Water currently operates primarily throughout the Caribbean region and South America and is pursuing new opportunities in North America, South America and other select markets. Seven Seas Water is supported by an operations center in Tampa, Florida, which provides business development, engineering, field service support, procurement and administrative functions. Quench offers WAAS solutions by providing bottleless filtered water coolers and other products that use filtered water as an input, such as ice machines, sparkling water dispensers and coffee brewers, to customers across the United States. Quench’s point‑of‑use systems purify a customer’s existing water supply. Quench offers solutions to a broad mix of industries, including government, education, medical, manufacturing, retail, and hospitality. Quench installs and maintains its filtered water systems typically under multi‑year contracts that renew automatically. Quench is supported by an operations center in King of Prussia, Pennsylvania, which provides marketing and business development, field service and supply chain support, customer care and administrative functions. Corporate Reorganization Prior to the completion of the IPO on October 12, 2016, the Company and AquaVenture Holdings LLC completed a series of reorganization transactions which are described below: · On July 1, 2016, AquaVenture Holdings LLC contributed all of the stock of its wholly-owned subsidiary, AquaVenture Holdings Curaçao N.V., to AquaVenture Holdings Limited in exchange for 1,000,000 ordinary shares of the Company. · On October 4, 2016, AquaVenture Holdings LLC contributed to AquaVenture Holdings Limited: (i) the stock of Quench USA, Inc. and Seven Seas Water Corporation and (ii) all cash and other remaining assets and liabilities (other than the shares of AquaVenture Holdings Limited it held). Subsequently, AquaVenture Holdings LLC merged with a newly formed subsidiary of AquaVenture Holdings Limited, resulting in each Class A Preferred share, Class B share, Class Q share, Common share, and Management Incentive Plan (“MIP”) share being converted into ordinary shares of AquaVenture Holdings Limited pursuant to the terms of AquaVenture Holdings LLC’s limited liability company agreement. Quench USA Holdings LLC, a member of AquaVenture Holdings LLC, then merged with a separate newly formed subsidiary of AquaVenture Holdings Limited, resulting in the distribution of shares of AquaVenture Holdings Limited to its members pursuant to the terms of Quench USA Holdings LLC’s limited liability company agreement. The reorganization transactions are considered transactions between entities under common control. As a result, the financial statements for periods prior to the IPO and the reorganization transactions are the financial statements of AquaVenture Holdings LLC as the predecessor to the Company for accounting and reporting purposes. Unless otherwise specified, the “Company” refers to the operations of both AquaVenture Holdings Limited and AquaVenture Holdings LLC throughout the remainder of these notes. Initial Public Offering On October 5, 2016, the Company’s IPO was declared effective and on October 12, 2016, the Company completed the IPO of 7,475,000 ordinary shares at a public offering price of $18.00 per share. The Company received net proceeds of $118.8 million, after deducting underwriting discounts and commissions and offering expenses. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Summary of significant accounting policies | |
Summary of significant accounting policies | 2. Summary of Significant Accounting Policies Unless otherwise noted below, there have been no material changes to the accounting policies presented in Note 2—“Summary of Significant Accounting Policies” of the notes to the audited consolidated financial statements, included in Item 8. Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. Basis of Presentation The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, certain information and footnotes normally required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. In management’s opinion, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting of only normal recurring adjustments) considered necessary for a fair presentation of the Company’s unaudited condensed consolidated balance sheet as of March 31, 2017, the unaudited condensed consolidated statements of operations for the three months ended March 31, 2017 and 2016 and the unaudited condensed consolidated statements of cash flows for the three months ended March 31, 2017 and 2016. The unaudited condensed consolidated balance sheet as of December 31, 2016 was derived from the audited consolidated balance sheet as of December 31, 2016, as presented in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. The unaudited condensed consolidated financial statements include the accounts of AquaVenture Holdings Limited and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include: accounting for goodwill and identifiable intangible assets and any related impairment; property, plant and equipment and any related impairment; long‑term contract costs and any related impairment; share‑based compensation; allowance for doubtful accounts; obligations for asset retirement; and deferred income taxes. Although these and other estimates and assumptions are based on the best available information, actual results could be materially different from these estimates. Adoption of New Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”), issued authoritative guidance that simplifies the accounting related to share-based payment award transaction including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. This guidance is effective for annual reporting periods beginning on or after December 15, 2016, including interim periods within those annual periods. The Company has adopted this guidance on January 1, 2017. Beginning January 1, 2017, on a prospective basis, excess tax benefits or deficiencies are reflected in the consolidated statements of operations as a component of the provision for income taxes. Additionally, the consolidated statement of cash flows now present excess tax benefits as an operating activity on a prospective basis and employee taxes paid by the Company when shares are withheld as a financing activity on a retrospective basis. Lastly, on a modified retrospective basis, the Company has elected to account for forfeitures as they occur. When compared to the Company’s policy for forfeitures prior to the adoption of the pronouncement, the election had no impact. There was no impact to the consolidated unaudited loss from operations, net loss, or unaudited condensed consolidated statement of cash flows for the three months ended March 31, 2016 or consolidated net assets and accumulated deficit as of December 31, 2016. In November 2016, the FASB issued authoritative guidance that requires inclusion of cash and cash equivalents that have restrictions on withdrawal or use in total cash and cash equivalents on the statement of cash flows. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company has adopted this guidance on January 1, 2017. The Company now presents the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows and no longer presents transfers between cash and cash equivalents and restricted cash and restricted cash investments in the statement of cash flows. Cash, cash equivalents and restricted cash stated in the consolidated unaudited statement of cash flows represents the addition of cash and cash equivalents, restricted cash classified as current and restricted cash classified as non-current line items in the unaudited condensed consolidated balance sheet. The adoption was on a retrospective basis and the unaudited condensed consolidated statement of cash flows for the three months ended March 31, 2016 has been adjusted to reflect the adoption. The adoption does not have any impact on the unaudited condensed consolidated balance sheet or statement of operations. In August 2016, the FASB issued authoritative guidance that addresses various classification issues related to the statement of cash flows. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company has adopted this guidance on January 1, 2017 on a retrospective basis. The adoption did not have any impact on the unaudited condensed consolidated financial statements. New Accounting Pronouncements In January 2017, the FASB issued authoritative guidance that updates and clarifies the definition of a business with the objective of adding guidance to assist in evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company is currently evaluating the potential impact of the accounting and disclosure requirements on the consolidated financial statements. The Company has not yet decided whether to early adopt during 2017, but will comply upon adoption. In October 2016, the FASB issued authoritative guidance, that requires the recognition of income tax consequences of intercompany asset transfers other than inventory at the transaction date. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company is currently evaluating the potential impact of the accounting and disclosure requirements on the consolidated financial statements. The Company expects to finalize its assessment during 2017. In May 2014, the FASB issued authoritative guidance regarding revenue from contracts with customers that specifies that revenue should be recognized when promised goods or services are transferred to customers in an amount that reflects the consideration which the company expects to be entitled in exchange for those goods or services. This guidance is effective for annual reporting periods beginning on or after December 15, 2017 and interim periods within those annual periods and will require enhanced disclosures. While the Company is currently developing its approach for its assessment to determine the potential impact of the accounting and disclosure requirements on the consolidated financial statements, it expects to finalize its assessment and provide a qualitative and quantitative impact during 2017. The Company expects to adopt the guidance on a retrospective basis on January 1, 2018. In conjunction with this adoption, the Company will also adopt the authoritative guidance issued in March 2017 regarding the determination of the customer in a service concession arrangement. In February 2016, the FASB issued authoritative guidance regarding leases that requires lessees to recognize a lease liability and right‑of‑use asset for operating leases, with the exception of short‑term leases. In addition, lessor accounting was modified to align, where necessary, with lessee accounting modifications and the authoritative guidance regarding revenue from contracts with customers. This guidance will be effective for annual reporting periods beginning on or after December 15, 2018, including interim periods within those annual periods, and early adoption is permitted. While the Company is currently developing its approach for its assessment to determine the potential impact of the accounting and disclosure requirements on the consolidated financial statements, it expects to finalize its assessment and provide a qualitative and quantitative impact during 2017. The Company expects to early adopt the guidance on a retrospective basis effective January 1, 2018 in conjunction with the guidance regarding revenue from contracts with customers. |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations | |
Business Combinations | 3. Business Combinations Aguas De Bayovar S.A.C. On October 31, 2016, AquaVenture Holdings Peru S.A.C. ("AVH Peru"), a Peruvian company and an indirect wholly-owned subsidiary of AquaVenture Holdings Limited, acquired 100% of the outstanding shares of Aguas de Bayovar S.A.C. (‘‘ADB’’) and all of the rights and obligations under a design and construction contract for a desalination plant and related infrastructure located in Peru for an aggregate purchase price of $46.5 million in cash, including a final working capital adjustment of $186 thousand (the “Peru Acquisition”) which was paid in February 2017. The desalination plant and related infrastructure, which was completed in 2010, has a design capacity of 2.7 million gallons per day, and ADB operates and maintains the desalination plant and related infrastructure constructed under the design and construction agreement to produce water for a contracted fee on a take-or-pay basis for a phosphate mining company pursuant to an operating and maintenance contract, which expires in 2037. The rights to the design and construction contract are accounted for as a note receivable that requires monthly installment payments from the customer for the construction of the desalination plant and related infrastructure, which continue until 2024. The operations of ADB are included in the Seven Seas Water reportable segment for the periods after the date of acquisition. The Seven Seas Water business completed the Peru Acquisition to expand its installed base of seawater reverse osmosis desalination facilities used to provide WAAS, its presence in South America and the industries served. Pro Forma Financial Information The following unaudited pro forma financial information (in thousands) for the Company gives effect to the acquisition of ADB, which occurred on October 31, 2016, as if it had occurred on January 1, 2016. These unaudited pro forma results have been prepared for comparative purposes only and do not purport to be indicative of the results of operations that actually would have resulted had the acquisitions occurred on the date indicated, or that may result in the future. Three months ended March 31, 2017 2016 Revenues $ 29,008 $ 28,008 Net loss $ (6,126) $ (2,810) |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Measurements | |
Fair Value Measurements | 4. Fair Value Measurements At March 31, 2017 and December 31, 2016, the Company had the following assets and liabilities measured at fair value on a recurring basis in the unaudited condensed consolidated balance sheets: · U.S. Treasury securities are measured on a recurring basis and are recorded at fair value based on quoted market value in an active market, which is considered a Level 1 input. · Money market funds are measured on a recurring basis and are recorded at fair value based on each fund’s quoted market value per share in an active market, which is considered a Level 1 input. There were no transfers into or out of Level 1, 2 or 3 assets during the three months ended March 31, 2017. Transfers between levels are deemed to have occurred if the lowest level of input were to change. The Company’s fair value measurements as of March 31, 2017 and December 31, 2016 were as follows (in thousands): Quoted Prices in Significant Active Markets Other Significant Asset/ for Identical Observable Unobservable Assets/Liabilities Measured at Fair Value (Liability) Assets (Level 1) Inputs (Level 2) Inputs (Level 3) As of March 31, 2017 Recurring basis: Money market funds $ 31,655 $ 31,655 $ — $ — U.S. Treasury securities $ 29,307 $ 29,307 $ — $ — As of December 31, 2016 Recurring basis: Money market funds $ 29,523 $ 29,523 $ — $ — U.S. Treasury securities $ 24,777 $ 24,777 $ — $ — |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Share-based Compensation | |
Share-Based Compensation | 5. Share‑Based Compensation AquaVenture Equity Awards As described in Note 1—“Description of the Business”, the Company completed a reorganization on October 4, 2016, which resulted in the conversion, pursuant to the terms of AquaVenture Holdings LLC’s limited liability agreement, of all outstanding equity awards of AquaVenture Holdings LLC to equity awards of AquaVenture Holdings Limited, with the underlying security being ordinary shares of AquaVenture Holdings Limited. The conversion retained the same economics of each of the outstanding equity awards. All other terms, including vesting, remained unchanged. The Quench USA Holdings LLC 2014 Equity Incentive Plan and Quench USA, Inc. 2008 Stock Plan (collectively, the “Quench Equity Plans”) were assumed by AquaVenture Holdings Limited on October 4, 2016. All outstanding awards of the Quench Equity Plans were converted to equity awards of AquaVenture Holdings Limited, with the underlying security being ordinary shares of the AquaVenture Holdings Limited. Consistent with the effects of the conversion on the AquaVenture Holding LLC equity awards, economics for each outstanding award were retained and all terms, including vesting, remained unchanged. I ssuances of securities under the AquaVenture Holdings LLC Amended and Restated Equity Incentive Plan and the Quench Equity Plans ceased at the time of the effectiveness of the IPO on October 5, 2016. As a result, no securities remain available for issuance under these plans . On September 22, 2016, the Company approved and adopted the AquaVenture Holdings Limited 2016 Share Option and Incentive Plan (the “2016 Plan”), which allows for the issuance of incentive share options, non-qualified share options, share appreciation rights, restricted share units, restricted share awards, unrestricted share awards, cash-based awards, performance share awards and dividend equivalent rights to officers, employees, managers, directors and other key persons, including consultants to the Company. The aggregate number of ordinary shares initially available for issuance, subject to adjustment upon a change in capitalization, under the 2016 Plan was 5.0 million shares. The shares available for issuance will increase annually by 4% of the number of ordinary shares issued and outstanding on the immediately preceding December 31. As of January 1, 2017, the number of ordinary shares available for issuance under the 2016 Plan is 6.1 million shares. During the three months ended March 31, 2017, the Company granted options to purchase 39 thousand ordinary shares to eligible recipients with an exercise price of $16.49 per share. The options to purchase ordinary shares have a time-based vesting schedule of four years with 25% on the first anniversary and the remaining 75% vesting quarterly over the remaining three years. In addition, t he Company also granted 18 thousand restricted share units. The restricted share units have a time-based vesting schedule of four years with 25% on the first anniversary and the remaining 75% vesting quarterly over the remaining three years. There was no significant exercises or forfeiture activity during the three months ended March 31, 2017. During the three months ended March 31, 2016, the Company did not make any grants and there were no exercises or significant forfeiture activity. Share‑Based Compensation Expense Total share‑based compensation expense recognized related to all equity awards during the three months ended March 31, 2017 and 2016 was $2.9 million and $0.7 million, respectively. There was no related tax benefit for the three months ended March 31, 2017 and 2016 as a full deferred tax asset valuation allowance was recorded in the United States for domestic operations. |
Loss per Share
Loss per Share | 3 Months Ended |
Mar. 31, 2017 | |
Loss per Share | |
Loss per Share | 6. Loss per Share Basic earnings (loss) per share is computed by dividing net earnings (loss) attributable to ordinary shareholders for the period by the weighted-average number of ordinary shares outstanding during the same period. Basic weighted-average shares outstanding excludes unvested shares of restricted share awards. Diluted earnings (loss) per share is computed by dividing net earnings (loss) attributable to ordinary shareholders for the period by the weighted-average number of ordinary shares outstanding adjusted to give effect to potentially dilutive securities using the treasury stock method, except where the effect of including the effect of such securities would be anti-dilutive. There were no ordinary shares outstanding prior to October 6, 2016, therefore no loss per share information has been presented for any period prior to that date. The following table provides information for calculating net loss applicable to ordinary shareholders (in thousands, except per share amounts): Three months ended March 31, 2017 Numerator: Net loss $ (6,126) Denominator: Weighted-average ordinary shares outstanding - basic and diluted 26,386 Loss per share - basic and diluted $ (0.23) Given that the Company had a net loss for the period ended March 31, 2017, the calculation of diluted loss per share is computed using basic weighted average ordinary shares outstanding. Approximately 3.9 million weighted-average outstanding share awards were excluded from the calculation of diluted earnings per share because their effect was antidilutive. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure | |
Commitments and Contingencies | 7. Commitments and Contingencies Asset Retirement Obligations Asset retirement obligation (“ARO”) liabilities, which arise from contractual requirements to perform certain asset retirement activities and is generally recorded when the asset is constructed, is based on the Company’s engineering estimates of future costs to dismantle and remove equipment from a customer’s plant site and to restore the site to a specified condition at the conclusion of a contract. As appropriate, the Company revises certain of its liabilities based on changes in the projected costs for future removal and shipping activities. These revisions, along with accretion expense, are included in cost of revenues in the unaudited condensed consolidated statement of operations. During the three months ended March 31, 2017 and 2016, the Company recorded accretion expense of $12 thousand and $10 thousand, respectively. No valuation adjustments were recorded during the three months ended March 31, 2017 and 2016. At March 31, 2017 and December 31, 2016, the current portion of the ARO liabilities was $26 thousand and $0, respectively, and was recorded in accrued liabilities in the unaudited condensed consolidated balance sheets. At March 31, 2017 and December 31, 2016, the long‑term portion of the ARO liabilities was $1.0 million $1.1 million, respectively, and was recorded in other long‑term liabilities in the unaudited condensed consolidated balance sheets. Litigation, Claims and Administrative Matters The Company, may, from time to time, be a party to legal proceedings, claims, and administrative matters that arise in the normal course of business. The Company has made accruals with respect to certain of these matters, where appropriate, that are reflected in the unaudited condensed consolidated financial statements but are not, individually or in the aggregate, considered material. For other matters for which an accrual has not been made, the Company has not yet determined that a loss is probable or the amount of loss cannot be reasonably estimated. While the ultimate outcome of the matters cannot be determined, the Company currently does not expect that these proceedings and claims, individually or in the aggregate, will have a material effect on the unaudited condensed consolidated financial position, results of operations, or cash flows. The outcome of any litigation is inherently uncertain, however, and if decided adversely to the Company, or if the Company determines that settlement of particular litigation is appropriate, the Company may be subject to liability that could have a material adverse effect on the unaudited condensed consolidated financial position, results of operations, or cash flows. The Company maintains liability insurance in such amounts and with such coverage and deductibles as management believes is reasonable. The principal liability risks that the Company insures against are customer lawsuits caused by damage or nonperformance, workers’ compensation, personal injury, bodily injury, property damage, directors’ and officers’ liability, cybersecurity and cyber incidents, errors and omissions, employment practices liability and fidelity losses. There can be no assurance that the Company’s liability insurance will cover all events or that the limits of coverage will be sufficient to fully cover all liabilities. As of March 31, 2017, the Company has determined there are no matters for which a material loss is reasonably possible or the Company has either determined that the range of loss is not reasonably estimable or that any reasonably estimable range of loss is not material to the unaudited condensed consolidated financial statements. |
Cash Flow Information
Cash Flow Information | 3 Months Ended |
Mar. 31, 2017 | |
Cash Flow Information | |
Cash Flow Information | 8. Cash Flow Information Supplemental cash flow information is as follows (in thousands): Three Months Ended March 31, 2017 2016 Cash paid during the period: Income taxes, net $ 427 $ 54 Interest, net $ 2,582 $ 2,315 Non-Cash Transaction Information: Non-cash capital expenditures $ 168 $ 1,007 Unpaid offering costs $ — $ 881 Unpaid debt financing costs $ — $ 11 The components of total ending cash for the periods presented in the unaudited condensed consolidated statement of cash flows are as follows (in thousands): Three Months Ended March 31, 2017 2016 Cash and cash equivalents $ 89,918 $ 27,987 Restricted cash, current 166 930 Restricted cash, non-current 6,003 6,294 $ 96,087 $ 35,211 |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting | |
Segment Reporting | 9. Segment Reporting The Company has two operating and reportable segments, Seven Seas Water and Quench. This determination is supported by, among other factors, the existence of individuals responsible for the operations of each segment and who also report directly to the Company’s chief operating decision maker (“CODM”), the nature of the segment’s operations and information presented to the Company’s CODM. Seven Seas Water provides outsourced desalination solutions and wastewater treatment for governmental, municipal, industrial and hospitality customers internationally under long‑term contracts. Quench provides bottleless filtered water coolers and other products that use filtered water as an input, such as ice machines, sparkling water dispensers and coffee brewers, to customers throughout the United States typically under multi‑year contracts. Revenues reported under the Seven Seas Water reportable segment primarily represent bulk water sales and service, including revenues generated from service concession arrangements, whereas revenues reported under the Quench reportable segment primarily represent rental of filtered water and related systems. Prior to January 1, 2017, the Company included the majority of certain general and administrative costs, primarily professional service and other expenses to support the activities of the registrant holding company, within the Seven Seas reportable segment. Beginning January 1, 2017, the Company began separating “Corporate and Other” for the CODM and for segment reporting purposes. The Corporate and Other administration function is not treated as a segment but includes certain general and administrative costs that are not allocated to either of the reportable segments. These costs include, but are not limited to, professional service and other expenses to support the activities of the registrant holding company. Corporate and Other does not include any labor allocations from the Seven Seas Water and Quench segments. The Company believes this presentation more accurately portrays the results of the core operations of each of the operating and reportable segments to the CODM. As a result of this change, the Company has restated prior periods for segment reporting purposes. As part of the segment reconciliation below, intercompany interest expense and the associated intercompany interest income are included but are eliminated in consolidation. The following table provides information by reportable segment and a reconciliation to the consolidated results for the three months ended March 31, 2017 (in thousands): Three months ended March 31, 2017 Seven Seas Corporate Water Quench & Other Total Revenues: Bulk water $ 14,215 $ — $ — $ 14,215 Rental — 12,804 — 12,804 Other — 1,989 — 1,989 Total revenues 14,215 14,793 — 29,008 Gross profit: Bulk water 5,391 — — 5,391 Rental — 7,050 — 7,050 Other — 853 — 853 Total gross profit 5,391 7,903 — 13,294 Selling, general and administrative expenses 6,154 9,411 923 16,488 Loss from operations (763) (1,508) (923) (3,194) Other (expense) income, net (1,258) (1,033) 294 (1,997) Loss before income tax expense (2,021) (2,541) (629) (5,191) Income tax expense 859 76 — 935 Net loss $ (2,880) $ (2,617) $ (629) $ (6,126) Other information: Depreciation and amortization expense $ 4,272 $ 3,535 $ — $ 7,807 Interest expense (income), net $ 1,076 $ 1,033 $ (294) $ 1,815 Expenditures for long-lived assets $ 841 $ 2,564 $ — $ 3,405 Amortization of deferred financing fees $ 138 $ 71 $ — $ 209 The following table provides information by reportable segment and a reconciliation to the consolidated results for the three months ended March 31, 2016 (in thousands): Three months ended March 31, 2016 Seven Seas Corporate Water Quench & Other Total Revenues: Bulk water $ 13,491 $ — $ — $ 13,491 Rental — 11,706 — 11,706 Other — 1,932 — 1,932 Total revenues 13,491 13,638 — 27,129 Gross profit: Bulk water 5,828 — — 5,828 Rental — 6,242 — 6,242 Other — 893 — 893 Total gross profit 5,828 7,135 — 12,963 Selling, general and administrative expenses 4,342 9,011 344 13,697 Income (loss) from operations 1,486 (1,876) (344) (734) Other (expense) income, net (1,607) (1,024) 5 (2,626) Loss before income tax expense (121) (2,900) (339) (3,360) Income tax expense 628 — — 628 Net loss $ (749) $ (2,900) $ (339) $ (3,988) Other information: Depreciation and amortization expense $ 4,012 $ 3,252 $ — $ 7,264 Interest expense, net $ 1,556 $ 1,024 $ — $ 2,580 Expenditures for long-lived assets $ 3,320 $ 2,926 $ — $ 6,246 Amortization of deferred financing fees $ 151 $ 33 $ — $ 184 As of March 31, 2017, total assets for the Seven Seas Water and Quench reportable segments were $268.0 million and $191.8 million, respectively. As of December 31, 2016, total assets for the Seven Seas Water and Quench reportable segments were $274.2 million and $193.4 million, respectively. As of March 31, 2017 and December 31, 2016, total assets for Corporate and Other were $63.4 million and $69.0 million, respectively. |
Significant Concentrations, Ris
Significant Concentrations, Risks and Uncertainties | 3 Months Ended |
Mar. 31, 2017 | |
Significant Concentrations, Risks and Uncertainties | |
Significant Concentrations, Risks and Uncertainties | 10. Significant Concentrations, Risks and Uncertainties The Company is exposed to interest rate risk resulting from its variable rate loans outstanding that adjust with movements in LIBOR or the lending bank’s prime lending rate. For the three months ended March 31, 2017, a significant portion of the Company’s revenues are derived from territories and countries in the Caribbean region. Demand for water in the Caribbean region is impacted by, among other things, levels of rainfall and the tourism industry. High levels of rainfall and a downturn in the level of tourism and demand for real estate could adversely impact the future performance of the Company. At March 31, 2017, a significant portion of the Company’s property, plant and equipment is located in the Caribbean region. The Caribbean islands are situated in a geography where tropical storms and hurricanes occur with regularity, especially during certain times of the year. The Company designs its plant facilities to withstand such conditions; however, a major storm could result in plant damage or periods of reduced consumption or unavailability of electricity or source seawater needed to produce water. It is the Company’s policy to maintain adequate levels of property and casualty insurance; however, the Company only insures certain plants for wind. The operation of desalination plants requires significant amounts of electricity which typically is provided by the local utility of the jurisdiction in which the plant is located. A shortage of electricity supply caused by force majeure or material increases in electricity costs could adversely impact the Company’s operating results. To mitigate the risk of electricity cost increases, the Company has generally contracted with major customers for those cost increases to be borne by the customers and has invested in energy efficient technology. Management believes that rising energy costs and availability of its supply of electricity would not have a material adverse effect on its future performance. |
Summary of Significant Accoun17
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Summary of significant accounting policies | |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, certain information and footnotes normally required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. In management’s opinion, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (consisting of only normal recurring adjustments) considered necessary for a fair presentation of the Company’s unaudited condensed consolidated balance sheet as of March 31, 2017, the unaudited condensed consolidated statements of operations for the three months ended March 31, 2017 and 2016 and the unaudited condensed consolidated statements of cash flows for the three months ended March 31, 2017 and 2016. The unaudited condensed consolidated balance sheet as of December 31, 2016 was derived from the audited consolidated balance sheet as of December 31, 2016, as presented in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. The unaudited condensed consolidated financial statements include the accounts of AquaVenture Holdings Limited and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include: accounting for goodwill and identifiable intangible assets and any related impairment; property, plant and equipment and any related impairment; long‑term contract costs and any related impairment; share‑based compensation; allowance for doubtful accounts; obligations for asset retirement; and deferred income taxes. Although these and other estimates and assumptions are based on the best available information, actual results could be materially different from these estimates. |
New Accounting Pronouncements | Adoption of New Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”), issued authoritative guidance that simplifies the accounting related to share-based payment award transaction including income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. This guidance is effective for annual reporting periods beginning on or after December 15, 2016, including interim periods within those annual periods. The Company has adopted this guidance on January 1, 2017. Beginning January 1, 2017, on a prospective basis, excess tax benefits or deficiencies are reflected in the consolidated statements of operations as a component of the provision for income taxes. Additionally, the consolidated statement of cash flows now present excess tax benefits as an operating activity on a prospective basis and employee taxes paid by the Company when shares are withheld as a financing activity on a retrospective basis. Lastly, on a modified retrospective basis, the Company has elected to account for forfeitures as they occur. When compared to the Company’s policy for forfeitures prior to the adoption of the pronouncement, the election had no impact. There was no impact to the consolidated unaudited loss from operations, net loss, or unaudited condensed consolidated statement of cash flows for the three months ended March 31, 2016 or consolidated net assets and accumulated deficit as of December 31, 2016. In November 2016, the FASB issued authoritative guidance that requires inclusion of cash and cash equivalents that have restrictions on withdrawal or use in total cash and cash equivalents on the statement of cash flows. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company has adopted this guidance on January 1, 2017. The Company now presents the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows and no longer presents transfers between cash and cash equivalents and restricted cash and restricted cash investments in the statement of cash flows. Cash, cash equivalents and restricted cash stated in the consolidated unaudited statement of cash flows represents the addition of cash and cash equivalents, restricted cash classified as current and restricted cash classified as non-current line items in the unaudited condensed consolidated balance sheet. The adoption was on a retrospective basis and the unaudited condensed consolidated statement of cash flows for the three months ended March 31, 2016 has been adjusted to reflect the adoption. The adoption does not have any impact on the unaudited condensed consolidated balance sheet or statement of operations. In August 2016, the FASB issued authoritative guidance that addresses various classification issues related to the statement of cash flows. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company has adopted this guidance on January 1, 2017 on a retrospective basis. The adoption did not have any impact on the unaudited condensed consolidated financial statements. New Accounting Pronouncements In January 2017, the FASB issued authoritative guidance that updates and clarifies the definition of a business with the objective of adding guidance to assist in evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company is currently evaluating the potential impact of the accounting and disclosure requirements on the consolidated financial statements. The Company has not yet decided whether to early adopt during 2017, but will comply upon adoption. In October 2016, the FASB issued authoritative guidance, that requires the recognition of income tax consequences of intercompany asset transfers other than inventory at the transaction date. This guidance will be effective for annual reporting periods beginning on or after December 15, 2017, including interim periods within those annual periods, and early adoption is permitted. The Company is currently evaluating the potential impact of the accounting and disclosure requirements on the consolidated financial statements. The Company expects to finalize its assessment during 2017. In May 2014, the FASB issued authoritative guidance regarding revenue from contracts with customers that specifies that revenue should be recognized when promised goods or services are transferred to customers in an amount that reflects the consideration which the company expects to be entitled in exchange for those goods or services. This guidance is effective for annual reporting periods beginning on or after December 15, 2017 and interim periods within those annual periods and will require enhanced disclosures. While the Company is currently developing its approach for its assessment to determine the potential impact of the accounting and disclosure requirements on the consolidated financial statements, it expects to finalize its assessment and provide a qualitative and quantitative impact during 2017. The Company expects to adopt the guidance on a retrospective basis on January 1, 2018. In conjunction with this adoption, the Company will also adopt the authoritative guidance issued in March 2017 regarding the determination of the customer in a service concession arrangement. In February 2016, the FASB issued authoritative guidance regarding leases that requires lessees to recognize a lease liability and right‑of‑use asset for operating leases, with the exception of short‑term leases. In addition, lessor accounting was modified to align, where necessary, with lessee accounting modifications and the authoritative guidance regarding revenue from contracts with customers. This guidance will be effective for annual reporting periods beginning on or after December 15, 2018, including interim periods within those annual periods, and early adoption is permitted. While the Company is currently developing its approach for its assessment to determine the potential impact of the accounting and disclosure requirements on the consolidated financial statements, it expects to finalize its assessment and provide a qualitative and quantitative impact during 2017. The Company expects to early adopt the guidance on a retrospective basis effective January 1, 2018 in conjunction with the guidance regarding revenue from contracts with customers. |
Business Combinations (Tables)
Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations | |
Pro Forma Financial Information | Three months ended March 31, 2017 2016 Revenues $ 29,008 $ 28,008 Net loss $ (6,126) $ (2,810) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Measurements | |
Schedule of fair value measurements | The Company’s fair value measurements as of March 31, 2017 and December 31, 2016 were as follows (in thousands): Quoted Prices in Significant Active Markets Other Significant Asset/ for Identical Observable Unobservable Assets/Liabilities Measured at Fair Value (Liability) Assets (Level 1) Inputs (Level 2) Inputs (Level 3) As of March 31, 2017 Recurring basis: Money market funds $ 31,655 $ 31,655 $ — $ — U.S. Treasury securities $ 29,307 $ 29,307 $ — $ — As of December 31, 2016 Recurring basis: Money market funds $ 29,523 $ 29,523 $ — $ — U.S. Treasury securities $ 24,777 $ 24,777 $ — $ — |
Loss per Share (Tables)
Loss per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Loss per Share | |
Schedule of net loss per share | The following table provides information for calculating net loss applicable to ordinary shareholders (in thousands, except per share amounts): Three months ended March 31, 2017 Numerator: Net loss $ (6,126) Denominator: Weighted-average ordinary shares outstanding - basic and diluted 26,386 Loss per share - basic and diluted $ (0.23) |
Cash Flow Information (Tables)
Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Cash Flow Information | |
Supplemental cash flow information | Supplemental cash flow information is as follows (in thousands): Three Months Ended March 31, 2017 2016 Cash paid during the period: Income taxes, net $ 427 $ 54 Interest, net $ 2,582 $ 2,315 Non-Cash Transaction Information: Non-cash capital expenditures $ 168 $ 1,007 Unpaid offering costs $ — $ 881 Unpaid debt financing costs $ — $ 11 The components of total ending cash for the periods presented in the unaudited condensed consolidated statement of cash flows are as follows (in thousands): Three Months Ended March 31, 2017 2016 Cash and cash equivalents $ 89,918 $ 27,987 Restricted cash, current 166 930 Restricted cash, non-current 6,003 6,294 $ 96,087 $ 35,211 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting | |
Schedule of information by reportable segment | The following table provides information by reportable segment and a reconciliation to the consolidated results for the three months ended March 31, 2017 (in thousands): Three months ended March 31, 2017 Seven Seas Corporate Water Quench & Other Total Revenues: Bulk water $ 14,215 $ — $ — $ 14,215 Rental — 12,804 — 12,804 Other — 1,989 — 1,989 Total revenues 14,215 14,793 — 29,008 Gross profit: Bulk water 5,391 — — 5,391 Rental — 7,050 — 7,050 Other — 853 — 853 Total gross profit 5,391 7,903 — 13,294 Selling, general and administrative expenses 6,154 9,411 923 16,488 Loss from operations (763) (1,508) (923) (3,194) Other (expense) income, net (1,258) (1,033) 294 (1,997) Loss before income tax expense (2,021) (2,541) (629) (5,191) Income tax expense 859 76 — 935 Net loss $ (2,880) $ (2,617) $ (629) $ (6,126) Other information: Depreciation and amortization expense $ 4,272 $ 3,535 $ — $ 7,807 Interest expense (income), net $ 1,076 $ 1,033 $ (294) $ 1,815 Expenditures for long-lived assets $ 841 $ 2,564 $ — $ 3,405 Amortization of deferred financing fees $ 138 $ 71 $ — $ 209 The following table provides information by reportable segment and a reconciliation to the consolidated results for the three months ended March 31, 2016 (in thousands): Three months ended March 31, 2016 Seven Seas Corporate Water Quench & Other Total Revenues: Bulk water $ 13,491 $ — $ — $ 13,491 Rental — 11,706 — 11,706 Other — 1,932 — 1,932 Total revenues 13,491 13,638 — 27,129 Gross profit: Bulk water 5,828 — — 5,828 Rental — 6,242 — 6,242 Other — 893 — 893 Total gross profit 5,828 7,135 — 12,963 Selling, general and administrative expenses 4,342 9,011 344 13,697 Income (loss) from operations 1,486 (1,876) (344) (734) Other (expense) income, net (1,607) (1,024) 5 (2,626) Loss before income tax expense (121) (2,900) (339) (3,360) Income tax expense 628 — — 628 Net loss $ (749) $ (2,900) $ (339) $ (3,988) Other information: Depreciation and amortization expense $ 4,012 $ 3,252 $ — $ 7,264 Interest expense, net $ 1,556 $ 1,024 $ — $ 2,580 Expenditures for long-lived assets $ 3,320 $ 2,926 $ — $ 6,246 Amortization of deferred financing fees $ 151 $ 33 $ — $ 184 |
Description of the Business - C
Description of the Business - Corporate Reorganization (Details) | Jul. 01, 2016shares | Mar. 31, 2017segment |
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract] | ||
Number of operating platforms | segment | 2 | |
AquaVenture Holdings Curacao | AquaVenture Holdings LLC | Transaction Between Entities Under Common Control | Ordinary shares | ||
Business Acquisition [Line Items] | ||
Shares issued to acquire predecessor during reorganization | shares | 1,000,000 |
Description of the Business - I
Description of the Business - Initial Public Offering (Details) - IPO $ / shares in Units, $ in Millions | Oct. 12, 2016USD ($)$ / sharesshares |
Subsidiary, Sale of Stock [Line Items] | |
Ordinary shares issued | shares | 7,475,000 |
Public offering price (in dollars per share) | $ / shares | $ 18 |
Proceeds from IPO, net | $ | $ 118.8 |
Business Combinations - ADB (De
Business Combinations - ADB (Details) - AVH Peru - ADB $ in Thousands, gal in Millions | Oct. 31, 2016USD ($)gal |
Business Acquisition [Line Items] | |
Percentage acquired | 100.00% |
Purchase price | $ 46,500 |
Working capital adjustment | $ 186 |
Desalination infrastructure capacity (in gallons) | gal | 2.7 |
Business Combinations - Proform
Business Combinations - Proforma financial information (Details) - ADB - AquaVenture Water Corporation - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Business Acquisition, Pro Forma Information [Abstract] | ||
Revenues | $ 29,008 | $ 28,008 |
Net loss | $ (6,126) | $ (2,810) |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Asset transfers out of Level 1 into Level 2 | $ 0 | |
Assets transfers out of Level 2 into Level 1 | 0 | |
Asset transfers into (out of) Level 3 | 0 | |
Fair Value, Measurements, Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Money market funds | 31,655 | $ 29,523 |
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Money market funds | 31,655 | 29,523 |
Fair Value, Measurements, Recurring | US Treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Held-to-maturity securities | 29,307 | 24,777 |
Fair Value, Measurements, Recurring | US Treasury securities | Fair Value, Inputs, Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Held-to-maturity securities | $ 29,307 | $ 24,777 |
Share-Based Compensation - Equi
Share-Based Compensation - Equity Awards before Corporate Reorganization (Details) $ / shares in Units, $ in Thousands | Jan. 01, 2017shares | Mar. 31, 2017USD ($)$ / sharesshares | Mar. 31, 2016USD ($)shares | Sep. 22, 2016shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total share-based compensation expense | $ | $ 2,900 | $ 700 | ||
Tax benefit | $ | $ 0 | $ 0 | ||
2016 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grants of options | 0 | |||
Forfeited | 0 | 0 | ||
Exercised (number of shares) | 0 | 0 | ||
Ordinary Share Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grants of options | 39,000 | |||
Exercise price (in dollars per share) | $ / shares | $ 16.49 | |||
Ordinary Share Units | First Anniversary | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting Period | 4 years | |||
Vesting Percentage | 25.00% | |||
Ordinary Share Units | Thereafter | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting Percentage | 75.00% | |||
Ordinary Share Units | 2016 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Aggregate number of shares by class authorized for grant under the Equity Incentive Plan | 6,100,000 | 5,000,000 | ||
Annual percentage increase in shares available for issuance | 4 | |||
Restricted Stock Units | First Anniversary | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting Period | 4 years | |||
Vesting Percentage | 25.00% | |||
Restricted Stock Units | Thereafter | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting Percentage | 75.00% | |||
Restricted Stock Units | 2016 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted in period | 18,000 |
Loss per Share (Details)
Loss per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Oct. 05, 2016 | |
Common stock outstanding | 26,388 | 26,388 | ||
Numerator: | ||||
Net loss | $ (6,126) | $ (3,988) | ||
Denominator: | ||||
Weighted-average ordinary shares outstanding - basic and diluted | 26,386 | |||
Loss per share - basic and diluted | $ (0.23) | |||
Ordinary Share Units | ||||
Common stock outstanding | 0 | |||
Denominator: | ||||
Weighted average outstanding share awards excluded from the calculation of diluted earnings per share | 3,900 |
Commitments and Contingencies -
Commitments and Contingencies - Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |||
Accretion of obligation | $ 12 | $ 10 | |
Valuation adjustments | 0 | $ 0 | |
Accrued Liabilities | |||
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |||
Current portion of the ARO liabilities | 26 | $ 0 | |
Other Noncurrent Liabilities | |||
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | |||
Long-term portion of the ARO liabilities | $ 1,000 | $ 1,100 |
Cash Flow Information (Details)
Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash Paid During The Period [Abstract] | ||||
Income taxes, net | $ 2,582 | $ 2,315 | ||
Interest, net | 427 | 54 | ||
Noncash Investing and Financing Items [Abstract] | ||||
Non-cash capital expenditures | 168 | 1,007 | ||
Unpaid offering costs | 881 | |||
Unpaid debt financing costs | 11 | |||
Components of Total Ending Cash | ||||
Cash and cash equivalents | 89,918 | 27,987 | $ 95,334 | |
Restricted cash, current | 166 | 930 | 166 | |
Restricted cash, non-current | 6,003 | 6,294 | 5,895 | |
Cash, cash equivalents and restricted cash | $ 96,087 | $ 35,211 | $ 101,395 | $ 25,026 |
Segment Reporting - Information
Segment Reporting - Information by Reportable Segment (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017USD ($)segment | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) | |
Segment Reporting Information, Operating Income (Loss) [Abstract] | |||
Number of operating segments | segment | 2 | ||
Number of reportable segments | segment | 2 | ||
Bulk water | $ 14,215 | $ 13,491 | |
Rental | 12,804 | 11,706 | |
Other | 1,989 | 1,932 | |
Total revenues | 29,008 | 27,129 | |
Bulk water | 5,391 | 5,828 | |
Rental | 7,050 | 6,242 | |
Other | 853 | 893 | |
Total gross profit | 13,294 | 12,963 | |
Selling, general and administrative expenses | 16,488 | 13,697 | |
Loss from operations | (3,194) | (734) | |
Other (expense) income, net | (1,997) | (2,626) | |
Loss before income tax expense | (5,191) | (3,360) | |
Income tax expense | 935 | 628 | |
Net loss | (6,126) | (3,988) | |
Other information | |||
Depreciation and amortization | 7,807 | 7,264 | |
Interest expense, net | 1,815 | 2,580 | |
Expenditures for long-lived assets | 3,405 | 6,246 | |
Amortization of deferred financing fees | 209 | 184 | |
Assets | 523,115 | $ 536,696 | |
Seven Seas Water | |||
Segment Reporting Information, Operating Income (Loss) [Abstract] | |||
Bulk water | 14,215 | 13,491 | |
Total revenues | 14,215 | 13,491 | |
Bulk water | 5,391 | 5,828 | |
Total gross profit | 5,391 | 5,828 | |
Selling, general and administrative expenses | 6,154 | 4,342 | |
Loss from operations | (763) | 1,486 | |
Other (expense) income, net | (1,258) | (1,607) | |
Loss before income tax expense | (2,021) | (121) | |
Income tax expense | 859 | 628 | |
Net loss | (2,880) | (749) | |
Other information | |||
Depreciation and amortization | 4,272 | 4,012 | |
Interest expense, net | 1,076 | 1,556 | |
Expenditures for long-lived assets | 841 | 3,320 | |
Amortization of deferred financing fees | 138 | 151 | |
Assets | 268,000 | 274,200 | |
Quench USA Holdings LLC | |||
Segment Reporting Information, Operating Income (Loss) [Abstract] | |||
Rental | 12,804 | 11,706 | |
Other | 1,989 | 1,932 | |
Total revenues | 14,793 | 13,638 | |
Rental | 7,050 | 6,242 | |
Other | 853 | 893 | |
Total gross profit | 7,903 | 7,135 | |
Selling, general and administrative expenses | 9,411 | 9,011 | |
Loss from operations | (1,508) | (1,876) | |
Other (expense) income, net | (1,033) | (1,024) | |
Loss before income tax expense | (2,541) | (2,900) | |
Income tax expense | 76 | ||
Net loss | (2,617) | (2,900) | |
Other information | |||
Depreciation and amortization | 3,535 | 3,252 | |
Interest expense, net | 1,033 | 1,024 | |
Expenditures for long-lived assets | 2,564 | 2,926 | |
Amortization of deferred financing fees | 71 | 33 | |
Assets | 191,800 | 193,400 | |
Corporate & Other | |||
Segment Reporting Information, Operating Income (Loss) [Abstract] | |||
Selling, general and administrative expenses | 923 | 344 | |
Loss from operations | (923) | (344) | |
Other (expense) income, net | 294 | 5 | |
Loss before income tax expense | (629) | (339) | |
Net loss | (629) | $ (339) | |
Other information | |||
Interest expense, net | (294) | ||
Assets | $ 63,400 | $ 69,000 |