Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 26, 2021 | Jun. 30, 2020 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity File Number | 001-38382 | ||
Entity Registrant Name | FTS INTERNATIONAL, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 30-0780081 | ||
Entity Address, Address Line One | 777 Main Street | ||
Entity Address, Address Line Two | Suite 2900 | ||
Entity Address, City or Town | Fort Worth | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 76102 | ||
City Area Code | 817 | ||
Local Phone Number | 862-2000 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 10.8 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001529463 | ||
Amendment Flag | false | ||
Class A common stock | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Class A Common Stock, par value $0.01 per share | ||
Trading Symbol | FTSI | ||
Security Exchange Name | NYSE | ||
Entity Common Stock, Shares Outstanding | 13,677,664 | ||
Class B common stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 312,306 | ||
Series A Preferred Purchase Rights | |||
Document Information [Line Items] | |||
Title of 12(b) Security | Series A Preferred Purchase Rights | ||
Trading Symbol | FTSI | ||
Security Exchange Name | NYSE |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | 36 Months Ended | ||||||||
Dec. 31, 2020 | Nov. 19, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | |||||||||
Revenue | ||||||||||||||
Revenue | $ 22.6 | $ 27.2 | $ 32.1 | $ 29.5 | $ 150.8 | $ 142.3 | $ 186 | $ 225.8 | $ 221.6 | $ 239.6 | $ 775.7 | $ 1,450.4 | ||
Revenue from related parties | 0.7 | 0.9 | 0.7 | 0.9 | 92.9 | |||||||||
Total revenue | 22.6 | 27.2 | 32.1 | 29.5 | 151.5 | 142.3 | 186 | 225.8 | 222.5 | 240.3 | 776.6 | 1,543.3 | ||
Operating expenses | ||||||||||||||
Costs of revenue (excluding depreciation of $4.6, $65.2, | 24.1 | 23 | 30.7 | 28.9 | 114.6 | 101.5 | 145.5 | 164.8 | 162.1 | 197.2 | 573.9 | 1,033.2 | ||
Selling, general and administrative | 4.7 | 5.1 | 11.8 | 13.2 | 17.7 | 22.7 | 21.1 | 21.7 | 23.6 | 47.8 | 89.1 | 87.9 | ||
Depreciation and amortization | 4.8 | 9.1 | 17.8 | 20.2 | 21.4 | 22.1 | 22.7 | 22.8 | 22.4 | 68.5 | 90 | 84.7 | ||
Impairments and other charges | 0.3 | 0.1 | 19.4 | 10.3 | 4.3 | 2.1 | 6.8 | 3.9 | 61.8 | 34.1 | 74.6 | 19.2 | ||
Loss (gain) on disposal of assets, net | 0.2 | (0.1) | (0.4) | (0.1) | (1.2) | 0.3 | 0.1 | (1.4) | (0.1) | |||||
Total operating expenses | 33.9 | 37.3 | 79.7 | 72.8 | 157.9 | 148 | 196 | 212 | 270.2 | 347.7 | 826.2 | 1,224.9 | ||
Operating (loss) income | (11.3) | (10.1) | (47.6) | (43.3) | (6.4) | (5.7) | (10) | 13.8 | (47.7) | (107.4) | (49.6) | 318.4 | ||
Interest expense, net | (7.4) | (7.4) | (7.3) | (7.2) | (7.6) | (7.7) | (8.2) | (22.1) | (30.7) | (49.3) | ||||
Gain (loss) on extinguishment of debt, net | 2 | 0.8 | (0.1) | 0.5 | 2 | 1.2 | (9.8) | |||||||
Equity in net income of joint venture affiliate | 0.6 | 0.6 | 1.1 | |||||||||||
Gain on sale of equity interest in joint venture affiliate | 7 | 7 | ||||||||||||
Reorganization items, net | (2.1) | 117 | (13.7) | 103.3 | ||||||||||
(Loss) income before income taxes | (13.4) | 106.9 | (68.7) | (50.7) | (11.7) | (12.9) | (9.8) | 6 | (54.8) | (24.2) | (71.5) | 260.4 | $ 151.3 | |
Income tax expense | 0 | 0.2 | 0.1 | 1 | 0.1 | 0.2 | 0.2 | 1.4 | 2 | |||||
Net (loss) income | (13.4) | $ 106.7 | $ (68.7) | $ (50.7) | $ (11.7) | (13) | (10.8) | 5.9 | (55) | (24.4) | (72.9) | 258.4 | ||
Net (loss) income attributable to common stockholders | $ (13.4) | $ (13) | $ (10.8) | $ 5.9 | $ (55) | $ (24.4) | $ (72.9) | $ 681.6 | ||||||
Basic and diluted (loss) earnings per share attributable to common stockholders | $ (0.96) | $ 19.83 | $ (12.77) | $ (9.43) | $ (2.18) | $ (2.42) | $ (1.99) | $ 1.08 | $ (10.03) | $ (4.54) | $ (13.40) | $ 130.88 | ||
Shares used in computing basic and diluted (loss) earnings per share (in thousands) | 13,990 | 5,382 | 5,381 | 5,379 | 5,367 | 5,365,000 | 5,430,000 | 5,484,000 | 5,483,000 | 5,377 | 5,440 | 5,208 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Depreciation | ||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor | Predecessor |
Depreciation | $ 4.6 | $ 65.2 | $ 82.5 | $ 75.9 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED BALANCE SHEETS | |||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Successor | Predecessor |
Current assets | |||
Cash and cash equivalents | $ 94 | $ 94 | $ 223 |
Accounts receivable, net | 26.9 | 26.9 | 77 |
Inventories | 29 | 29 | 45.5 |
Prepaid expenses and other current assets | 19.5 | 19.5 | 7 |
Total current assets | 169.4 | 169.4 | 352.5 |
Property, plant, and equipment, net | 132.3 | 132.3 | 227 |
Operating lease right-of-use assets | 4.5 | 4.5 | 26.3 |
Intangible assets, net | 7.4 | 7.4 | 29.5 |
Other assets | 1.4 | 1.4 | 4 |
Total assets | 315 | 315 | 639.3 |
Current liabilities | |||
Accounts payable | 26.9 | 26.9 | 36.4 |
Accrued expenses | 12.5 | 12.5 | 22.9 |
Current portion of operating lease liabilities | 3 | 3 | 14.3 |
Other current liabilities | 0.3 | 0.3 | 11.6 |
Total current liabilities | 42.7 | 42.7 | 85.2 |
Long-term debt | 456.9 | ||
Operating lease liabilities | 3.3 | 3.3 | 13.9 |
Other liabilities | 2.4 | 2.4 | 45.6 |
Total liabilities | 48.4 | 48.4 | 601.6 |
Commitments and contingencies (Note 13) | |||
Stockholders' equity | |||
Successor Preferred stock, $0.01 par value, 5,000,000 shares authorized | |||
Common stock | 0.1 | 0.1 | 36.4 |
Additional paid-in capital | 279.9 | 279.9 | 4,382 |
Accumulated deficit | (13.4) | (13.4) | (4,380.7) |
Total stockholders' equity | 266.6 | 266.6 | 37.7 |
Total liabilities and stockholders' equity | $ 315 | $ 315 | $ 639.3 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Preferred stock. | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | |
Common stock, authorized (in shares) | 320,000,000 | |
Common stock, issued (in shares) | 5,355,370 | |
Common stock, outstanding (in shares) | 5,355,370 | |
Class A common stock | ||
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 49,000,000 | 49,000,000 |
Common stock, issued (in shares) | 13,677,664 | |
Common stock, outstanding (in shares) | 13,677,664 | |
Class B common stock | ||
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 1,000,000 | 1,000,000 |
Common stock, issued (in shares) | 312,306 | |
Common stock, outstanding (in shares) | 312,306 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Predecessor | Predecessor |
Cash flows from operating activities | ||||
Net (loss) income | $ (13.4) | $ (24.4) | $ (72.9) | $ 258.4 |
Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | 4.8 | 68.5 | 90 | 84.7 |
Stock-based compensation | 0.4 | 10.9 | 15.4 | 15.2 |
Amortization of debt discounts and issuance costs | 2 | 1.8 | 2.5 | |
Impairment of assets | 9.7 | |||
Loss (gain) on disposal of assets, net | 0.1 | (1.4) | (0.1) | |
(Gain) loss on extinguishment of debt, net | (2) | (1.2) | 9.8 | |
Non-cash provision for supply commitment charges | 9.1 | 58.5 | 19.2 | |
Cash paid to settle supply commitment charges | (31.3) | (17.6) | (5.3) | |
Gain sale of equity interest in joint venture affiliate | (7) | |||
Inventory write-down | 5.1 | 6.4 | ||
Non-cash reorganization items | (118.7) | |||
Other non-cash items | 0.9 | 4.7 | (1.6) | |
Changes in operating assets and liabilities: | ||||
Accounts receivable | 3.2 | 46 | 79 | 72.7 |
Accounts receivable from related parties | 3 | |||
Inventories | 2.2 | 6.9 | 14 | (22.6) |
Prepaid expenses and other assets | (0.1) | (3.8) | (1.5) | 2.8 |
Accounts payable | 5.5 | (13.9) | (47.3) | (41.6) |
Accrued expenses and other liabilities | 0.3 | (1.9) | (6.7) | (12.3) |
Net cash provided by (used in) operating activities | 2.9 | (46.5) | 123.9 | 384.8 |
Cash flows from investing activities | ||||
Capital expenditures | (1.5) | (19.6) | (54.4) | (100.5) |
Proceeds from disposal of assets | 0.2 | 3.3 | 1.9 | |
Proceeds from sale of equity interest in joint venture affiliate | 30.7 | |||
Net cash used in investing activities | (1.5) | (19.4) | (20.4) | (98.6) |
Cash flows from financing activities | ||||
Repayments of long-term debt | (20.6) | (46.4) | (625.1) | |
Payments To Secured Debt Holders | (30.7) | |||
Repurchases of common stock | (9.9) | |||
Taxes paid related to net share settlement of equity awards | (0.3) | (2) | (1.1) | |
Net proceeds from issuance of common stock | 303 | |||
Payments of revolving credit facility issuance costs | (0.2) | (2.4) | ||
Net cash used in financing activities | (51.8) | (58.3) | (325.6) | |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 1.4 | (117.7) | 45.2 | (39.4) |
Cash, cash equivalents, and restricted cash at beginning of period | 105.3 | 223 | 177.8 | 217.2 |
Cash, cash equivalents, and restricted cash at end of period | 106.7 | 105.3 | 223 | 177.8 |
Supplemental cash flow information: | ||||
Interest paid | 14.6 | 31 | 48.1 | |
Income tax payments, net | 0.4 | 2.5 | 2.3 | |
Supplemental disclosure of noncash investing activities: | ||||
Capital expenditures included in accounts payable | 0.5 | 0.2 | 0.9 | $ 4 |
Operating lease liabilities incurred from obtaining right-of-use assets | $ 0.1 | 0.6 | 11 | |
Operating lease liabilities and right-of-use assets derecognized due to lease terminations | $ 10.2 | $ 3.2 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Millions | Common Stock | Additional Paid-in Capital | Accumulated DeficitCumulative effect of accounting change | Accumulated Deficit | Cumulative effect of accounting change | Total |
Financial Designation, Predecessor and Successor [Fixed List] | Predecessor | |||||
Balance at beginning of period at Dec. 31, 2017 | $ 35.9 | $ 3,712.1 | $ (4,566.3) | $ (818.3) | ||
Balance at beginning of period (in shares) at Dec. 31, 2017 | 2,589,000 | |||||
Net (loss) income | 258.4 | 258.4 | ||||
Issuance of Common Stock | $ 0.1 | 302.9 | 303 | |||
Issuance of common stock (in shares) | 904,000 | |||||
Activity related to stock plan | 14 | 14 | ||||
Activity related to stock plan (in shares) | 8,000 | |||||
Recapitalization of convertible preferred stock to common stock | $ 0.4 | 349.4 | 349.8 | |||
Recapitalization of convertible preferred stock to common stock (in shares) | 1,971,000 | |||||
Balance at end of period at Dec. 31, 2018 | $ 36.4 | 4,378.4 | $ 0.1 | (4,307.9) | $ 0.1 | $ 106.9 |
Balance at end of period (in shares) at Dec. 31, 2018 | 5,472,000 | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Predecessor | |||||
Net (loss) income | (72.9) | $ (72.9) | ||||
Activity related to stock plan | 13.5 | 13.5 | ||||
Activity related to stock plan (in shares) | 31,000 | |||||
Repurchase of common stock | (9.9) | $ (9.9) | ||||
Repurchase of common stock (in shares) | (148,000) | (3,000,000) | ||||
Balance at end of period at Dec. 31, 2019 | $ 36.4 | 4,382 | (4,380.7) | $ 37.7 | ||
Balance at end of period (in shares) at Dec. 31, 2019 | 5,355,000 | 5,355,370 | ||||
Financial Designation, Predecessor and Successor [Fixed List] | Predecessor | |||||
Net (loss) income | (24.4) | $ (24.4) | ||||
Issuance of Common Stock | $ 0.1 | 279.5 | 279.6 | |||
Issuance of common stock (in shares) | 13,990,000 | |||||
Activity related to stock plan | 25.9 | 25.9 | ||||
Activity related to stock plan (in shares) | 101,000 | |||||
Cancelation of Predecessor Equity | $ (36.4) | (4,407.9) | 4,405.1 | (39.2) | ||
Cancelation of Predecessor Equity (in shares) | (5,456,000) | |||||
Balance at end of period before Cancellation of Predecessor Equity at Nov. 19, 2020 | $ 36.4 | 4,407.9 | (4,405.1) | 39.2 | ||
Balance at end of period before Cancellation of Predecessor Equity(in shares) at Nov. 19, 2020 | 5,456,000 | |||||
Balance at end of period After Cancellation Of Predecessor Equity at Nov. 19, 2020 | 0 | |||||
Balance at end of period at Nov. 19, 2020 | $ 0.1 | 279.5 | $ 279.6 | |||
Balance at end of period (in shares) at Nov. 19, 2020 | 13,990,000 | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | |||||
Balance at beginning of period at Dec. 31, 2019 | $ 36.4 | 4,382 | (4,380.7) | $ 37.7 | ||
Balance at beginning of period (in shares) at Dec. 31, 2019 | 5,355,000 | 5,355,370 | ||||
Balance at end of period at Dec. 31, 2020 | $ 0.1 | 279.9 | (13.4) | $ 266.6 | ||
Balance at end of period (in shares) at Dec. 31, 2020 | 13,990,000 | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | |||||
Balance at beginning of period at Nov. 19, 2020 | $ 0.1 | 279.5 | $ 279.6 | |||
Balance at beginning of period (in shares) at Nov. 19, 2020 | 13,990,000 | |||||
Net (loss) income | (13.4) | (13.4) | ||||
Activity related to stock plan | 0.4 | 0.4 | ||||
Balance at end of period at Dec. 31, 2020 | $ 0.1 | $ 279.9 | $ (13.4) | $ 266.6 | ||
Balance at end of period (in shares) at Dec. 31, 2020 | 13,990,000 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block | |
DESCRIPTION OF BUSINESS | FTS INTERNATIONAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 — DESCRIPTION OF BUSINESS Throughout the notes to these consolidated financial statements, the terms “the Company,” “we,” “us,” “our” or “ours” refer to FTS International, Inc., together with its consolidated subsidiaries. Certain prior year financial statements are not comparable to our current year financial statements due to the adoption of fresh start accounting. References to “Successor” or “Successor Company” relate to the financial position and results of operations of the reorganized Company subsequent to November 19, 2020. References to “Predecessor” or “Predecessor Company” relate to the financial position and results of operations of the Company prior to, and including, November 19, 2020. We are one of the largest providers of hydraulic fracturing services in North America. Our services enhance hydrocarbon flow from oil and natural gas wells drilled by exploration and production (“E&P”), companies in shale and other unconventional resource formations. Our customers include leading E&P companies that specialize in unconventional oil and natural gas resources in North America. We operate in the most active oil and gas basins in the United States. Substantially all of our business activities support our well completion services. We manage our business, allocate resources, and assess our financial performance on a consolidated basis; therefore, we do not have separate operating segments. In 2014, the Predecessor Company entered into a joint venture agreement with the Sinopec Oilfield Service Corporation (“Sinopec”). This joint venture collaboration offered hydraulic stimulation services in China. The joint venture company, SinoFTS Petroleum Services Ltd. (“SinoFTS”), was owned 55% by Sinopec and 45% by the Company. SinoFTS serves both Sinopec and other E&P companies in China. In August 2019, FTSI closed on the sale of its 45% equity ownership interest in SinoFTS, to Sinopec. In exchange, FTSI, through its affiliate FTS International Netherlands B.V., received consideration of $26.9 million for the sale of its equity interest, and through FTS International Services, LLC, received a royalty fee of $5.8 million for a license for its intellectual property use and for future limited support of the joint venture’s operations. After conducting an analysis of the relative fair values of the equity interest and royalty fee, FTSI allocated $30.7 million of the total consideration received to the sale of its equity interest and $2.0 million to the prepaid royalty fee. FTSI recognized a gain of $7.0 million on the sale of its equity interest. The prepaid royalty fee will be recognized over approximately six years. Concentrations of Risk Our business activities are concentrated in the well completion services segment of the oilfield services industry in the United States. The market for these services is cyclical, and we depend on the willingness of our customers to make operating and capital expenditures to explore for, develop, and produce oil and natural gas in the United States. The willingness of our customers to undertake these activities depends largely upon prevailing industry conditions that are predominantly influenced by current and expected prices for oil and natural gas. Historically, a low commodity-price environment has caused our customers to significantly reduce their hydraulic fracturing activities and the prices they are willing to pay for those services. During these periods, these customer actions materially adversely affected our business, financial condition and results of operations. Our customer base has historically been concentrated. Our business, financial condition and results of operations could be materially adversely affected if one or more of our significant customers ceases to engage us for our services on favorable terms, or at all, or fails to pay, or delays in paying, us significant amounts of our outstanding receivables. For the Successor period of November 20, 2020 to December 31, 2020 we had 6 customers make up over 10% of our consolidated revenue. These six customers represented 81% of our consolidated revenue; this level of customer concentration is partially due to the short time period included in the Successor period and may not be representative of customer concentration levels over a longer time period, such as a full fiscal year. For the Predecessor period of January 1, 2020 through November 19, 2020 we had one customer make up over 10% of our consolidated revenue. This customer represented 12% of our consolidated revenue. For the year ended December 31, 2019 we had two customers make up over 10% of our consolidated revenue. These two customers represented 26% of our consolidated revenue. For the year ended December 31, 2018 we had two customers make up over 10% of our consolidated revenue. These two customers represented 24% of our consolidated revenue. The loss of any of our largest existing customers could have a material adverse effect on our results of operations. While we view revenue as an important metric in assessing customer concentration, we also compare and manage our customer portfolio based on the number of fleets we place with each customer. Related Parties We have historically provided services and sold equipment to Chesapeake Energy Corporation and its affiliates (“Chesapeake”), which beneficially owned approximately 20% of the Predecessor’s common stock, and had the right to designate two individuals to serve on our board of directors prior to November 19, 2020. Revenue earned from Chesapeake was $0.7 million, $0.1 million and $92.9 million in Predecessor period of 2020, 2019 and 2018, respectively. At both December 31, 2020 and 2019, we had accounts receivable balances of zero from Chesapeake. We sold equipment to SinoFTS for zero, $0.9 million and $0.3 million in 2020, 2019 and 2018, respectively. All revenue earned from SinoFTS is based on prevailing market prices. At both December 31, 2020 and 2019, we had accounts receivable balances of zero from this related party. |
RESTRUCTURING
RESTRUCTURING | 12 Months Ended |
Dec. 31, 2020 | |
RESTRUCTURING | |
RESTRUCTURING | NOTE 2 —RESTRUCTURING On September 22, 2020, FTS International, Inc., FTS International Services, LLC, and FTS International Manufacturing, LLC filed petitions for voluntary relief (the “Chapter 11 Cases”) under Chapter 11 of Title 11 of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the Southern District of Texas, Houston Division (the “Bankruptcy Court”). On September 22, 2020, FTSI International, Inc., FTS International Services, LLC, and FTS International Manufacturing, LLC filed the Joint Prepackaged Chapter 11 Plan of Reorganization of FTS International, Inc. and its Debtor Affiliates (as amended, modified or supplemented, the “Plan”) and the related disclosure statement (the “Disclosure Statement”).On November 4, 2020, the Bankruptcy Court entered an order (the “Confirmation Order”) confirming the Plan, as modified by the Confirmation Order, and approving the Disclosure Statement. On November 19, 2020 (the “Effective Date”), the Plan became effective in accordance with its terms and FTS International, Inc., FTS International Services, LLC and FTS International Manufacturing, LLC emerged from Chapter 11. Pursuant to the Plan, on the Effective Date, all agreements, instruments, and other documents evidencing, relating to or otherwise connection with any of our common stock or other equity interests outstanding prior to the Effective Date (collectively, the “legacy equity interests”) were cancelled and such legacy equity interests have no further force or effect after the Effective Date. Holders of our legacy equity interests received (i) a number of shares of Class A common stock equal to their proportionate distribution of approximately 9.4% of our common stock under the Plan (subject to dilution by the warrants issued pursuant to the Plan and the Amended and Restated Equity and Incentive Compensation Plan (the “MIP”)), (ii) their proportionate distribution of 1,555,521 Tranche 1 Warrants to acquire Class A common stock and (iii) their proportionate distribution of 3,888,849 Tranche 2 Warrants to acquire Class A common stock. In addition, pursuant to the Plan, on the Effective Date, all outstanding obligations under the 6.25% senior secured notes due May 1, 2022 (the “Notes”) were cancelled and the indenture governing such obligations was cancelled, and the credit agreement, dated as of April 16, 2014, by and among FTS International, Inc., the lenders party thereto, and Wilmington Savings Fund Society, FSB, as successor administrative agent (the “Term Loan Agreement”), was cancelled, in each case except to the limited extent expressly set forth in the Plan. On the Effective Date, all liens and security interests granted to secure such obligations were automatically terminated and are of no further force and effect. The holders of Notes and holders of the claims under the Term Loan Agreement received their proportionate distribution of approximately 90.1% of our common stock (subject to dilution by the warrants issued pursuant to the Plan and the MIP) plus their pro rata share of $30.7 million cash distribution. The holders of claims in connection with the termination of the supply agreement between the Predecessor and Covia Holding Corporation received, in exchange for their claims, a $12.5 million cash distribution and 0.5% of our common stock (subject to dilution by the warrants issued pursuant to the Plan and the MIP). Shares of Class A common stock were also issued to a holder of certain termination claims under the Plan. |
FRESH START ACCOUNTING
FRESH START ACCOUNTING | 12 Months Ended |
Dec. 31, 2020 | |
FRESH START ACCOUNTING | |
FRESH START ACCOUNTING | NOTE 3 — FRESH START ACCOUNTING Fresh Start Accounting Upon emergence from bankruptcy, we met the criteria and were required to adopt fresh start accounting in accordance with ASC Topic 852, Reorganizations, which on the emergence date resulted in a new entity, the Successor, for financial reporting purposes, with no beginning retained earnings or deficit as of the fresh start reporting date. The criteria requiring fresh start accounting are: (i) the holders of then-existing voting shares of the Predecessor received less than 50 percent of the new voting shares of the Successor outstanding upon emergence from bankruptcy, and (ii) the reorganization value of the Company’s assets immediately prior to confirmation of the Plan was less than the total of all post-petition liabilities and allowed claims. The Company applied fresh start accounting effective November 19, 2020, the Effective Date. As such, fresh start accounting is reflected in the accompanying consolidated balance sheet as of December 31, 2020 and related fresh start adjustments are included in the accompanying statement of operations for the period from January 1, 2020 through November 19, 2020. As a result of the application of fresh start accounting and the effects of the implementation of the Plan, the financial statements for the period after November 19, 2020 will not be comparable with the financial statements prior to and including November 19, 2020. Reorganization Value Reorganization value represents the fair value of the Successor’s total assets and is intended to approximate the amount a willing buyer would pay for the assets immediately after restructuring. Under fresh start accounting, the Company allocated the reorganization value to its individual assets based on their estimated fair values. The Company’s reorganization value is derived from an estimate of enterprise value. Enterprise value represents the estimated fair value of an entity’s long-term debt and other interest-bearing liabilities and stockholders’ equity less unrestricted cash and cash equivalents. The Company estimated the enterprise value of the Successor to be $266 million at the Effective Date, which was in the Bankruptcy Court approved range of $190 million and $290 million. The enterprise value was derived from an independent valuation with the assistance of a third-party valuation advisor. Specific valuation approaches and key assumptions used to arrive at the reorganization value, and the value of discrete assets and liabilities resulting from the application of fresh start accounting, are described below in greater detail within the valuation process. Although the Company believes the assumptions and estimates used to develop enterprise value and reorganization value are reasonable and appropriate, different assumptions and estimates could materially impact the analysis and resulting conclusions. The assumptions used in estimating these values are inherently uncertain and require judgment. The following table reconciles the Company’s enterprise value to the fair value of the Successor’s common stock as of the Effective Date. November 19, (In millions) 2020 Enterprise value $ 266.3 Plus: Excess cash (1) 13.3 Fair value of Successor equity $ 279.6 The following table reconciles the Company’s enterprise value to the reorganization value as of the Effective Date: November 19, (In millions) 2020 Enterprise value $ 266.3 Plus: Excess cash (1) 13.3 Plus: Current liabilities 36.4 Plus: Non-interest-bearing non-current liabilities 6.2 Reorganization value of Successor assets $ 322.2 (1) Excess cash of $13.3 million is calculated by taking the Company's Successor cash and cash equivalents balance of $88.3 million less $75.0 million of minimum cash required to operate the business as determined by management. The minimum cash required to operate the business of $75.0 million was also utilized in the estimation of the range of enterprise values included in the Plan and approved by the Bankruptcy Court. Valuation Process The fair values of our principal assets, including inventories, land, buildings, and improvements, service equipment, and intangible assets were estimated with the assistance of third-party valuation advisors as of the Effective Date. In addition, we also estimated the fair value of the Company’s warrants as of the Effective Date. Inventories Inventories include parts, chemicals, and other raw materials. The fair value of the parts inventory was determined using a combination of the cost and income approaches. The cost approach estimates the fair value of an asset based on the cost to reconstruct or replace it with another of similar utility, with adjustments for physical deterioration and identified obsolescence. The income approach was used to quantify the economic support available for the parts inventory based on the enterprise value estimated for the Company. For the chemicals and other materials inventory, the Company determined that the book value as the proxy for fair value. Property, Plant, and Equipment Land, Buildings, and Improvements The fair value of land, buildings, and improvements was determined using a combination of the cost and market approaches. To determine the fair value of buildings and site improvements, the cost and market approaches were used. As part of the valuation process, information was obtained describing physical attributes such as land and building size, construction dates, and general improvement details. In applying the cost approach, the replacement cost was determined based on the current cost to construct improvements with similar utility, using modern materials and current standards, design, and layout. To determine the fair value of land and improvements, the market approach was used based on third party databases identifying listings of recent sales and comparable properties within pertinent market areas. Service Equipment and Other The fair value of the service equipment and other was estimated using a combination of the cost, market, and income approaches. The cost approach was primarily utilized, with the application of the market approach for selected assets based upon the specific characteristics being appraised. The cost approach measures the value of an asset based on the cost to reconstruct or replace it with another of similar utility, with adjustments for physical deterioration and identified obsolescence. The market approach measures the value of an asset through an analysis of recent sales or offerings of comparable assets. The income approach was used to quantify the economic support available for the service equipment and other based on the enterprise value estimated for the Company. Intangible Assets The fair value of intangible assets such as customer relationships, in-house developed software, and tradename was determined using a combination of the cost, market, and income approaches. To determine the fair value of customer relationships, the income approach was used based on the present value of the incremental after-tax cash flows attributable to the existing customer cash flow after deducting the appropriate contributory asset charges. The discount rate utilized to present-value the after-tax cash flows was selected based on consideration of the overall business risks and risks associated with the asset being valued. To determine the fair value of the in-house developed software, the cost replacement method, a form of the cost approach, was used. To determine the fair value of the tradename, the Royalty Savings Method, a variation of the income approach, was used. The estimated royalty rate was determined by observing publicly available royalty rates information for similar companies with similar assets. The forecasted cash flows expected to be generated as a result of the royalty savings were discounted to present value utilizing a discount rate considering overall business risks and risks associated with the asset being valued. Warrants The fair value of the warrants issued upon the Effective Date was estimated using the Black-Scholes-Merton option pricing model. The Black-Scholes-Merton model is an option pricing model used to estimate the fair value of options and warrants based on the following input assumptions: stock price, strike price, term, risk-free rate, volatility, and dividend yield. In using the Black-Scholes-Merton option pricing model to fair value the warrants, the following assumptions were used: market observable stock price on the Effective Date; strike prices of $33.04 and $37.14 for Tranche 1 and Tranche 2 warrants, respectively; expected volatility of 65.0%; risk-free rate of 0.22%; and an expected dividend yield of 0.0%. The expected volatility assumption was estimated using market data related to the Company and certain similar publicly traded entities with considerations for differences in size and leverage of the Company versus the publicly traded entities. The strike prices and term assumptions were based on the contractual term of the warrants. The risk-free rate assumption was based on United States Constant Maturity Treasury rates. Consolidated Balance Sheet The following illustrates the effects on the Company’s consolidated balance sheet due to the reorganization and fresh start accounting adjustments. The explanatory notes following the table below provide further details on the adjustments, including the assumptions and methods used to determine fair value for its assets, liabilities, and warrants. As of November 19, 2020 (in millions) Predecessor Reorganization Fresh Start Successor Company Adjustments Adjustments Company ASSETS Current assets Cash and cash equivalents $ 146.7 $ (58.4) (a) $ — $ 88.3 Accounts receivable, net 30.1 — — 30.1 Inventories 33.5 — (2.2) (k) 31.3 Prepaid expenses and other current assets 19.0 10.1 (b) (5.3) (l) 23.8 Total current assets 229.3 (48.3) (7.5) 173.5 Property, plant, and equipment, net 177.2 — (42.0) (m) 135.2 Operating lease right-of-use assets 4.7 — — 4.7 Intangible assets, net 29.5 — (22.1) (n) 7.4 Other assets 1.4 0.2 (c) (0.2) (o) 1.4 Total assets $ 442.1 $ (48.1) $ (71.8) $ 322.2 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities Accounts payable $ 20.3 $ 0.8 (d) $ — $ 21.1 Accrued expenses 11.6 0.2 (e) — 11.8 Current portion of operating lease liabilities 3.2 — — 3.2 Other current liabilities 12.8 (12.5) (f) — 0.3 Total current liabilities 47.9 (11.5) — 36.4 Operating lease liabilities 3.4 — — 3.4 Other liabilities 2.8 — — 2.8 Liabilities subject to compromise 488.8 (488.8) (g) — — Total liabilities 542.9 (500.3) — 42.6 Stockholders’ Common stock - Predecessor 36.4 (36.4) (h) — — Additional paid-in capital - Predecessor 4,392.9 (4,392.9) (h) — — Common stock - Successor — 0.1 (i) — 0.1 Additional paid-in capital - Successor — 279.5 (i) — 279.5 Accumulated deficit (4,530.1) 4,601.9 (j) (71.8) (p) — Total stockholders’ (deficit) equity (100.8) 452.2 (71.8) 279.6 Total liabilities and stockholders’ (deficit) equity $ 442.1 $ (48.1) $ (71.8) $ 322.2 Reorganization Adjustments a) Reflects the net cash activities that occurred on the Effective Date. Of the $9.1 million transferred from cash and cash equivalents to escrow account recorded to prepaid expenses and other current assets, $3.8 million was related to success fees recognized upon emergence. Of the $4.9 million payment of professional and success fees, $1.9 million was related to success fees paid and recognized upon emergence. November 19, (In millions) 2020 Transfer of payment for professional fees and success fees to escrow account recorded in prepaid expenses and other current assets $ (9.1) Payment of professional and success fees (4.9) Payment to secured debtholders (30.7) Payment of Covia settlement (12.5) Payment of emergence date bonus (1.0) Payment of debt issuance costs related to Successor Revolving Credit Facility (0.2) Change in cash and cash equivalents $ (58.4) b) Reflects adjustment to prepaid expenses and other current assets for the following activities. November 19, (In millions) 2020 Transfer of payment for professional fees and success fees from cash and cash equivalent $ 9.1 Payment of emergence date bonus 1.0 Change in prepaid expenses and other current assets $ 10.1 c) Reflects an adjustment to debt issuance costs related to the Successor Revolving Credit Facility of $0.2 million. d) Reflects an adjustment to accounts payable related to success fees of $3.8 million recognized upon emergence offset by a $3.0 million payment for previously accrued professional fees. e) Reflects an adjustment to accrued expenses related to taxes withheld from holders of Predecessor stock-based compensation upon acceleration and immediate vesting. f) Reflects a $12.5 million adjustment to other current liabilities related to payment of Covia settlement amount. g) On the Effective Date, we settled liabilities subject to compromise per the Plan. The adjustment reflects the removal of the balance from liabilities subject to compromise and the pre-tax gain on the settlement of liabilities subject to compromise as follows. November 19, (In millions) 2020 2022 Senior Notes $ 379.0 Term Loan 67.6 Supply commitment charges 42.2 Total liabilities subject to compromise 488.8 Issuance of New Common Stock to holders of 2022 Senior Notes (202.0) Issuance of New Common Stock to Term Loan lenders (36.1) Issuance of New Common Stock to unsecured claimholders (2.2) Payment to holders of 2022 Senior Notes (26.0) Payment to Term Loan lenders (4.7) Pre-tax gain on settlement of liabilities subject to compromise $ 217.8 h) Reflects the cancellation of the Predecessor's common stock and the Predecessor's additional paid-in capital, which includes the acceleration of the Predecessor’s stock-based compensation of $15.1 million. i) The following reconciles reorganization adjustments made to the Successor common stock and Successor additional paid-in capital: November 19, (In millions) 2020 Fair value of New Common Stock issued to holders of the 2022 Senior Notes claims $ 202.0 Fair value of New Common Stock issued to holders of the Term Loan claims 36.1 Fair value of New Common Stock issued to holders of the unsecured claims 2.2 Fair value of New Common Stock issued to holders of legacy equity interests 24.9 Fair value of warrants issued to legacy equity interests 14.4 Total Successor common stock and additional paid-in capital 279.6 Less: Successor common stock (0.1) Successor additional paid-in capital $ 279.5 j) Reflects the cumulative net impact of the following transactions on Predecessor accumulated deficit: November 19, (In millions) 2020 Pre-tax gain on settlement of liabilities subject to compromise as calculated in note f) $ 217.8 Acceleration of Predecessor stock-based compensation (15.3) Cancellation of Predecessor common stock and additional paid-in capital 4,444.4 Success fees recognized on the Effective Date (5.7) Issuance of Successor common stock to legacy equity interests (24.9) Issuance of warrants to legacy equity interests (14.4) Change in accumulated deficit $ 4,601.9 Fresh Start Adjustments k) Reflects the fair value adjustment to parts inventory. l) Reflects the write-off of prepaid premiums of $5.3 million in connection with the Predecessor’s directors & officers insurance. m) Reflects the fair value adjustments to property, plant, and equipment, as well as the elimination of the historical accumulated depreciation. n) Reflects the fair value adjustment to intangible assets, net. o) Reflects the write-off of debt issuance costs of $0.2 million related to the Successor Revolving Credit Facility. p) Reflects the cumulative effect on accumulated deficit of the fresh start accounting adjustments discussed above. Reorganization Items Reorganization items represent (i) expenses incurred associated with the Chapter 11 restructuring subsequent to the Petition Date, (ii) gains or losses from liabilities settled, and (iii) fresh start accounting adjustments, recorded in reorganization items in our consolidated statements of operations. Professional service provider charges associated with our restructuring that were incurred before the Petition Date are recorded in selling, general and administrative in our consolidated statements of operations. Successor Predecessor Period from Period from November 20, January 1, through through December 31, November 19, (In millions) 2020 2020 Pre-tax gain on settlement of liabilities subject to compromise $ — $ 217.8 Fresh start accounting adjustments — (71.8) Professional service provider fees and other expenses (1.9) (9.5) Success fees for professional service providers — (5.7) Derecognition of unamortized debt discounts and issuance costs — (2.5) Terminated executory contracts — (9.7) Acceleration of Predecessor stock-based compensation expense — (15.3) Other Costs (0.2) — (Loss)/gain on reorganization items, net $ (2.1) $ 103.3 Contractual interest expense of $4.4 million from the Petition Date through the Effective Date, associated with our outstanding term loan and senior notes, was not accrued or recorded in the Predecessor consolidated statement of operations as interest expense. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 4 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation We prepared the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of the Company and all majority-owned domestic and foreign subsidiaries. Investments over which we have the ability to exercise significant influence over operating and financial policies, but do not hold a controlling interest, are accounted for using the equity method of accounting. All significant intercompany accounts and transactions have been eliminated in consolidation. There were no items of other comprehensive income in the periods presented. Use of Estimates The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, related revenues and expenses, and the disclosure of gain and loss contingencies at the date of the financial statements and during the periods presented. We base these estimates on historical results and various other assumptions believed to be reasonable, all of which form the basis for making estimates concerning the carrying values of assets and liabilities that are not readily available from other sources. Actual results could differ materially from those estimates. Fresh Start Accounting Upon emergence from bankruptcy the Company adopted fresh start accounting. Refer to Note 3 – Fresh Start Accounting for further details. Cash and Cash Equivalents Cash equivalents include only investments with an original maturity of three months or less. We occasionally hold cash deposits in financial institutions that exceed federally insured limits. We monitor the credit ratings and our concentration of risk with these financial institutions on a continuing basis to safeguard our cash deposits. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at their invoiced amounts or amounts for which we have a right to invoice based on services completed. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments Inventories Inventories primarily consist of maintenance parts that are used to service our hydraulic fracturing equipment but will also include proppants and chemicals that are used to provide hydraulic fracturing services. Inventory held as of our emergence date was remeasured to fair value. Subsequent to our emergence, inventories are stated at the lower of cost or net realizable value. The cost basis of our inventories is based on the average cost method and includes in-bound freight costs. As necessary, we record an adjustment to decrease the value of slow moving and obsolete inventory to its net realizable value. To determine the adjustment amount, we regularly review inventory quantities on hand and compare them to estimates of future product demand, market conditions, production requirements and technological developments. Restricted Cash The Company had $12.7 million and zero restricted cash at December 31, 2020 and 2019, respectively. At December 31, 2020 the company’s restricted cash included unsettled escrow fees related to our bankruptcy emergence and cash used as collateral for other banking products. Property, Plant, and Equipment Property, plant, and equipment held as of our emergence date was remeasured to fair value and depreciated over the estimated remaining useful lives of individual assets. Property, plant, and equipment purchased subsequent to our emergence date is stated at cost less accumulated depreciation, which is generally provided by using the straight-line method over the estimated useful lives of the individual assets. We manufacture and refurbish equipment used in our hydraulic fracturing operations and the cost of this equipment, which includes direct and indirect manufacturing costs, is capitalized and carried as construction-in-progress until it is completed. Expenditures for renewals and betterments that extend the lives of our service equipment, which includes the replacement of significant components of service equipment, are capitalized and depreciated. Other repairs and maintenance costs are expensed as incurred. We capitalize qualifying costs related to the acquisition or development of internal-use software. Capitalization of costs begins after the conceptual formulation stage has been completed. Capitalized costs are amortized over the estimated useful life of the software, which ranges between three Leases We determine if a contract contains a lease at inception. We lease certain administrative offices, sales offices, and operational facilities. We also lease some service equipment and light duty vehicles. These leases have remaining lease terms of 6 years or less. Some leases contain options to extend the leases, and some include options to terminate the leases. We do not include renewal or termination options in our assessment of the lease terms unless extension or termination for certain leases is deemed to be reasonably certain. Lease agreements with lease and non-lease components are generally accounted for as a single lease component. Operating lease assets and liabilities are recognized at the lease commencement date, which is the date we take possession of the property. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent our right to use an underlying asset and are valued based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental secured borrowing rates corresponding to the lease term including reasonably certain renewal periods. We estimate this rate based on prevailing financial market conditions, credit analysis, and management judgment. Our leases typically contain rent escalations over the lease term. We recognize expense for these leases on a straight-line basis over the lease term. Additionally, tenant incentives used to fund leasehold improvements are recognized when earned and reduce our right-of-use asset related to the lease. These are amortized through the operating lease asset as reductions of expense over the lease term. We provide residual value guarantees for our leases of light-duty vehicles and certain service equipment. No amounts related to these residual value guarantees have been deemed probable and included in the lease liabilities on our consolidated balance sheet; however, if the value for all of the vehicles was zero and if we cancelled these leases at December 31, 2020, we would be required to pay a total of $5.6 million in residual value guarantees. Intangible Assets We have historically acquired indefinite-lived intangible assets related to business acquisitions. Intangible assets with indefinite lives are not amortized. The amount of indefinite-lived intangible assets recorded in our consolidated balance sheets for December 31, 2020, was $7.4 million, of which 6.0 million related to our tradename and $1.4 million related to our developed technology. At December 31, 2019, the amount of indefinite-lived intangible assets recorded in our consolidated balance sheets was $29.5 million which related to our tradename. On November 19, 2020, upon emergence from Chapter 11 bankruptcy our intangible assets were identified and valued at fair value and a finite life was assigned to our developed technology. We amortize this intangible asset with a finite life on a straight-line basis over a period of three years which the asset is expected to contribute to our future cash flows. Impairment of Long-Lived Assets and Intangible Assets Long-lived assets, such as property, plant, equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Recoverability is assessed based on the undiscounted future cash flows generated by the asset or asset group. If the carrying amount of an asset or asset group is not recoverable, we recognize an impairment loss equal to the amount by which the carrying amount exceeds fair value. We estimate fair value based on the income, market, or cost valuation techniques. Intangible assets with indefinite lives are reviewed at least annually for impairment, and in interim periods if certain events occur indicating that the carrying value of intangible assets may be impaired. We estimate fair values utilizing valuation methods such as discounted cash flows and comparable market valuations. We perform our annual impairment tests at the beginning of the fourth quarter. Equity Method Investments Investments in which we have the ability to exercise significant influence, but not control, are accounted for pursuant to the equity method of accounting. We recognize our proportionate share of earnings or losses of our international affiliates three months after they occur. When events and circumstances warrant, investments accounted for under the equity method of accounting are evaluated for impairment. An impairment charge is recorded whenever a decline in value of an investment below its carrying amount is determined to be other-than-temporary. Income Taxes Income taxes are accounted for using the asset and liability method. Deferred taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The effect on deferred taxes for a change in tax rates is recognized in earnings in the period that includes the enactment date. We recognize future tax benefits to the extent that such benefits are more likely than not to be realized. We record a valuation allowance to reduce the value of a deferred tax asset if based on the consideration of all available evidence, it is more likely than not that all or some portion of the deferred tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. We evaluate our deferred income taxes quarterly to determine if a valuation allowance is required by considering all available evidence, including historical and projected taxable income and tax planning strategies. We will adjust a previously established valuation allowance if we change our assessment of the amount of deferred income tax asset that is more likely than not to be realized. We record uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. Revenue Recognition The Company contracts with its customers to perform hydraulic fracturing services on one or more oil or natural gas wells. Under these arrangements, we satisfy our performance obligations as services are rendered, which is generally upon the completion of a fracturing stage. We typically complete one or more stages per day. A stage is considered complete when we have met the specifications set forth by the customer, at which time we have the right to invoice the customer and the customer is obligated to pay us for the services rendered. The price for our services typically includes an equipment charge and product charges for proppant, chemicals and other products consumed during the course of providing our services. Payment terms average approximately two months from the date a stage or well is completed. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. We also contract with some customers to provide them with the exclusive use of a fracturing fleet for a period of time. Our customers can generally terminate these contracts with less than 90 days’ notice. We satisfy our performance obligation as services are rendered, which is based on the passage of time rather than the completion of a stage. Under these arrangements, we have the right to receive consideration from a customer even if circumstances outside of our control prevent us from performing our work. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. Pricing for our services for all contracts is frequently negotiated with our customers and is based on prevailing market rates during each reporting period. The amounts we invoice our customers for services performed during a period are directly related to the value received by the customers for the period. There is no inherent uncertainty to the amount of consideration we will receive for services performed during a period and no judgment is required to allocate a portion of the transaction price to a future period. Accordingly, we are not required to identify any unsatisfied performance obligations nor attribute any revenue to them. During the periods presented we acted as a principal, rather than as an agent, for all of the goods and services that we provided to our customers; our customer arrangements did not include obligations for refunds or warranties of our work; our revenue does not include sales taxes collected from our customers; and we did not incur incremental costs to obtain or fulfill contracts with our customers. To comply with the FASB disclosure objective, we are required to disaggregate our revenue into categories if it will provide an enhanced understanding of how the nature, amount, timing, and uncertainty of our revenue and cash flows are affected by economic factors. To evaluate an appropriate level of disaggregation of revenue, we considered the following aspects of our business: ● We provide a single service to our customers. ● We only generate revenue in the U.S. onshore market. ● We have a homogeneous customer base, which is comprised of large oil and gas exploration companies. ● We provide our service over a short period of time. ● We do not disaggregate our revenue into categories for any external communications or to make resource allocation decisions. ● We do not have separate operating segments. Based on the above factors, we concluded that no additional disaggregation of revenue was necessary or meaningful to help depict the nature, amount, timing and uncertainty of our revenues and cash flows. Unconditional Purchase Obligations We have historically entered into supply arrangements, primarily for sand, with our vendors that contain unconditional purchase obligations. These represent obligations to transfer funds in the future for fixed or minimum quantities of goods at fixed or minimum prices. We enter into these unconditional purchase obligation arrangements in the normal course of business to ensure that adequate levels of sourced product are available to us. We currently do not have any such supply agreements. To account for these arrangements, we must monitor whether we may be required to make a minimum payment to a vendor in a future period because our projected inventory purchases may not satisfy our minimum commitments. Stock-Based Compensation We measure all employee stock-based compensation awards using a fair value method and record this cost in the consolidated financial statements. Our stock-based compensation relates to restricted stock units issued to our employees. On the date that an equity-classified award is granted, we determine the fair value of the award and recognize the compensation cost over the requisite service period, which typically is the period over which the award vests. For equity-classified awards with graded vesting based solely on the satisfaction of a service condition, we recognize compensation cost as a single award on a straight-line basis. We account for forfeited awards as forfeitures occur, which results in a reversal of stock-based compensation cost previously recognized up to the date of the forfeiture. For stock-based awards with performance conditions that affect vesting, we only recognize compensation cost when it is probable that the performance conditions will be met. Fair Value Measurements Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at a measurement date. We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: ● Level One: The use of quoted prices in active markets for identical financial instruments. ● Level Two: The use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or other inputs that are observable in the market or can be corroborated by observable market data. ● Level Three: The use of significant unobservable inputs that typically require the use of management’s estimates of assumptions that market participants would use in pricing. Money market funds, classified as cash and cash equivalents, are the only financial instruments that are measured and recorded at fair value on the Company’s balance sheets. The following table presents money market funds at their level within the fair value hierarchy. (In millions) Total Level 1 Level 2 Level 3 December 31, 2020 (Successor) Money market funds $ 59.6 $ 59.6 $ — $ — December 31, 2019 (Predecessor) Money market funds $ 193.6 $ 193.6 $ — $ — Reclassifications All inventory write-downs have been reclassified from costs of revenue to impairments and other charges on the statements of operations to conform to current year presentation. This reclassification had no effect on operating income (loss) or net income (loss) as previously reported. New Accounting Standards Updates In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases embedded leases and we identified the key terms that were necessary for us to calculate the right-of-use asset and lease liability. These consolidated financial statements have been prepared in accordance with the new ASU utilizing the modified retrospective transition method, which resulted in the recording of operating lease liabilities of approximately $38 million as of January 1, 2019 on our consolidated balance sheet with an immaterial effect on our consolidated statement of stockholders’ equity (deficit) and no related effect on our consolidated statement of operations. In November 2016, the FASB issued ASU 2016-18, Restricted Cash Successor Predecessor December 31, December 31, (In millions) 2020 2019 Cash and cash equivalents $ 94.0 $ 223.0 Restricted cash included in prepaid expenses and other current assets 12.7 — Total cash, cash equivalents, and restricted cash shown in the $ 106.7 $ 223.0 In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments |
SUPPLEMENTAL BALANCE SHEET INFO
SUPPLEMENTAL BALANCE SHEET INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | NOTE 5 — SUPPLEMENTAL BALANCE SHEET INFORMATION Accounts Receivable The following table summarizes our accounts receivable balance: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Trade accounts receivable $ 30.6 $ 80.3 Allowance for doubtful accounts (3.7) (3.3) Accounts receivable, net $ 26.9 $ 77.0 The change in allowance for doubtful accounts is as follows: Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 Balance at beginning of period $ 3.7 $ 3.3 $ 0.9 $ 2.1 Provision for bad debts, net included in selling, general, — 0.8 2.4 — Uncollectible receivables written off — (0.4) — (1.2) Balance at end of period $ 3.7 $ 3.7 $ 3.3 $ 0.9 Inventories The following table summarizes our inventories: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Maintenance parts $ 27.9 $ 43.0 Proppants and chemicals 1.0 2.3 Other 0.1 0.2 Total inventories $ 29.0 $ 45.5 Prepaid Expenses and Other Current Assets The following table summarizes our prepaid expenses and other current assets: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Restricted cash $ 12.7 $ — Prepaid expenses $ 6.7 $ 4.4 Other 0.1 2.6 Total prepaid expenses and other current assets $ 19.5 $ 7.0 Property, Plant, and Equipment, net The following table summarizes our property, plant, and equipment: Successor Predecessor Estimated December 31, December 31, Useful Life (Dollars in millions) 2020 2019 (in years) Service equipment $ 92.1 $ 797.2 2.5 – 10 Buildings and improvements 21.6 63.3 15 – 39 Office, software, and other equipment 0.5 44.4 3 – 7 Vehicles and transportation equipment 0.3 6.5 5 – 20 Land 8.4 7.0 N/A Construction-in-process and other 14.1 20.1 N/A Total property, plant, and equipment 137.0 938.5 Accumulated depreciation and amortization (4.7) (711.5) Total property, plant, and equipment, net $ 132.3 $ 227.0 Depreciation expense was $68.5 million for January 1 through November 19, 2020 (Predecessor), $4.7 million for November 20 through December 31, 2020 (Successor), and $90.0 million and $84.7 million in 2019 and 2018, respectively. Accrued Expenses The following table summarizes our accrued expenses: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Sales, use, and property taxes $ 4.8 $ 7.1 Employee compensation and benefits 5.6 8.0 Interest — 4.1 Insurance 2.0 3.1 Other 0.1 0.6 Total accrued expenses $ 12.5 $ 22.9 Other Current Liabilities The following table summarizes our other current liabilities: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Accrued supply commitment charges $ — $ 11.3 Other 0.3 0.3 Total other current liabilities $ 0.3 $ 11.6 Other Liabilities The following table summarizes our other liabilities: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Accrued supply commitment charges $ — $ 44.0 Other 2.4 1.6 Total other liabilities $ 2.4 $ 45.6 |
INDEBTEDNESS AND BORROWING FACI
INDEBTEDNESS AND BORROWING FACILITY | 12 Months Ended |
Dec. 31, 2020 | |
INDEBTEDNESS AND BORROWING FACILITY | |
INDEBTEDNESS AND BORROWING FACILITY | NOTE 6 — INDEBTEDNESS AND BORROWING FACILITY The following table summarizes our long-term debt: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Term loan due April 2021 $ — $ 90.0 Senior notes due May 2022 — 369.9 Total principal amount — 459.9 Less unamortized discount and debt issuance costs — (3.0) Total long-term debt $ — $ 456.9 Estimated fair value of long-term debt $ — $ 317.2 Estimated fair values for our term loan and senior notes were determined using recent trading activity and/or bid-ask spreads and are classified as Level 2 in the FASB’s fair value hierarchy. Successor Revolving Credit Facility On November 19, 2020, The Successor Company entered into a $40 million revolving credit facility, with an initial maturity date of November 19, 2023, with Wells Fargo, N.A. LIBOR borrowings under the credit facility bear interest at the greater of LIBOR or 0.75% plus a margin of 2.25% to 2.50% per annum, depending on facility utilization. Base rate loans are also available at our option. The credit facility includes a $15 million sub-limit for outstanding letters of credit which would reduce the amount available under the facility. We also pay a commitment fee on the unused amount of the facility of 0.375% per annum, depending on facility utilization. The obligations under the credit facility are secured by substantially all of our assets, including our working capital and equipment. The maximum availability of credit under the credit facility is limited at any time to the lesser of $40 million or a borrowing base. The borrowing base is based on percentages of eligible accounts receivable and is subject to certain reserves. In an event of default or if the amount available under the credit facility is less than either 12.5% of our maximum availability or $5.0 million, we will be required to maintain a minimum fixed charge coverage ratio of 1.0 to 1.0. If at any time borrowings and letters of credit issued under the credit facility exceed the borrowing base, we will be required to repay an amount equal to such excess. The credit facility contains covenants that could, in certain circumstances, limit our ability to issue additional debt, repurchase or pay dividends on our common stock, sell substantially all of our assets, make certain investments, or enter into certain other transactions. We were in compliance with all of the covenants in the credit facility at December 31, 2020. As of December 31, 2020, the borrowing base was $17.2 million and therefore our maximum availability under the credit facility was $17.2 million. As of December 31, 2020, there were no borrowings outstanding under the credit facility, and letters of credit totaling $4.0 million were issued, resulting in $13.2 million of availability under the credit facility. Predecessor 2021 Term Loan On April 16, 2014, the Predecessor Company entered into a $550 million term loan, which matures on April 16, 2021 (“Term Loan”), with a group of lenders with Wells Fargo Bank, N.A., as administrative agent. The Term Loan bears interest at a three-month London Interbank Offered Rate (“LIBOR”) plus a margin of 4.75% per annum, with a 1.00% LIBOR floor. Interest is payable on interest rate reset dates, which is generally monthly. The Term Loan was issued at a discount of $2.7 million for aggregate consideration of $547.3 million and resulted in net proceeds to the Company of $540.0 million after debt issuance costs of $7.3 million. In 2020, the Predecessor Company repaid $22.6 million of aggregate principal amount of Term Loan. We recognized a gain on debt extinguishment of $2.0 million. In 2019, we repaid $31.0 million of aggregate principal amount of Term Loan. We recognized a loss on debt extinguishment of $0.2 million. On November 19, 2020, upon emergence from Chapter 11 bankruptcy, the 2021 Term Loan was cancelled as part of the Plan. We were in compliance with all of the covenants in the Term Loan for all periods that the loan was outstanding until we filed for bankruptcy on September 22, 2020. Predecessor 2022 Senior Notes On April 16, 2014, the Predecessor Company completed an offering of $500 million of 6.25% senior secured notes due May 1, 2022, in a private offering to qualified institutional buyers (“2022 Senior Notes”). The credit facility was amended semiannually In 2020 and 2019, the Predecessor Company repurchased zero and $17.0 million, respectively, of aggregate principal amount of 2022 Senior Notes in the qualified institutional market. In 2019, the Predecessor Company recognized a gain on debt extinguishment of $1.4 million. In 2018, we repurchased $22.1 million of aggregate principal amount of 2022 Senior Notes in the qualified institutional market. We recognized a gain on debt extinguishment of $1.2 million. On November 19, 2020, upon emergence from Chapter 11 bankruptcy, the 2022 Senior Notes were cancelled as part of the Plan. We were in compliance with all of the covenants in the indenture governing our 2022 Senior Notes for all periods that these notes were outstanding, until be filed for bankruptcy on September 22, 2020. Predecessor 2020 Senior Floating Rate Notes On June 1, 2015, we completed an offering of $350 million of senior secured floating rate notes due June 15, 2020, in a private offering to qualified institutional buyers (“2020 Senior Notes”). The 2020 Senior Notes bore interest at a three-month LIBOR plus a margin of 7.5% per annum. In 2018, we repaid all $290.0 million of the remaining principal amount of 2020 Senior Notes. We recognized a loss on debt extinguishment of $8.3 million. We were in compliance with all of the covenants in the indenture governing our 2020 Senior Notes for all periods that these notes were outstanding. Predecessor Revolving Credit Facility On February 22, 2018, we entered into a $250 million revolving credit facility, with an initial maturity date of February 22, 2023, with a group of lenders with Wells Fargo, N.A., as administrative agent. As part of the Chapter 11 filing our revolving credit facility was terminated in the third quarter of 2020. Prior to its termination, the maximum availability of credit under our revolving credit facility was limited at any time to the lesser of $100 million or a borrowing base. The credit facility was amended in August 2020, which among other things, reduced the maximum availability under the credit facility from $250 million to $100 million. The borrowing base was based on percentages of eligible accounts receivable and was subject to certain reserves. If at any time borrowings and letters of credit issued under the credit facility exceeded the borrowing base, we would be required to repay an amount equal to such excess. During 2020, the Predecessor Company had no borrowings drawn under the credit facility, and certain letters of credit were issued. At September 30, 2020, we had replaced these letters of credit with cash collateralized letters of credit. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
LEASES | NOTE 7 — LEASES We had no material amount of finance leases or subleases at December 31, 2020. The following table summarizes the components of our lease costs. Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 Operating lease cost $ 0.3 $ 12.7 $ 21.1 Short-term lease cost 0.4 4.7 5.8 Total lease cost $ 0.7 $ 17.4 $ 26.9 Short-term lease costs represent costs related to leases with terms of one year or less. We elected the practical expedient to not recognize lease assets and liabilities for these leases. We had no material variable lease costs in 2020 or 2019. Total rental expense under previous lease accounting guidance was $49.9 million in 2018. The following table includes other supplemental information for our operating leases. Successor Predecessor Period from Period from November 20, January 1, through through Year Ended December 31, November 19, December 31, (Dollars in millions) 2020 2020 2019 Cash paid for amounts included in the measurement of our lease liabilities $ 0.3 $ 12.9 21.3 Right-of-use assets obtained in exchange for lease liabilities $ 0.1 $ 0.6 11 Right-of-use assets recognized upon adoption of the leasing standard $ — $ — 37.8 Weighted-average remaining lease term 2.9 years 2.9 years 2.3 years Weighted-average discount rate 4.9% 4.9% 5.0% The following table summarizes the maturity of our operating leases as of December 31, 2020. Successor December 31, (In millions) 2020 2021 $ 3.2 2022 1.3 2023 1.2 2024 1.1 2025 — 2026 and thereafter — Total lease payments 6.8 Less imputed interest (0.5) Total lease liabilities $ 6.3 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) | 12 Months Ended |
Dec. 31, 2020 | |
STOCKHOLDERS' EQUITY (DEFICIT) | |
STOCKHOLDERS' EQUITY (DEFICIT) | NOTE 8 — STOCKHOLDERS’ EQUITY (DEFICIT) Common and Preferred Stock On November 19, 2020, upon emergence from Chapter 11 bankruptcy, all existing shares of Predecessor common stock were cancelled, and the Successor Company issued approximately 13.7 million shares of Class A common stock and 0.3 million shares of Class B common stock. On November 19, 2020, upon emergence from Chapter 11 bankruptcy, the Successor Company filed an Amended and Restated Certificate of Incorporation with the Delaware Secretary of State. Pursuant to the Certificate of Incorporation, the authorized capital stock of FTSI consists of 49,000,000 shares of New Class A Common Stock and 1,000,000 shares of New Class B Common Stock and 5,000,000 shares of Preferred Stock, par value $0.01 per share (the “Preferred Stock”). The New Class B Common Stock is identical to the New Class A Common Stock, except that such New Class B Common Stock shall not be listed for trading on any national securities exchange or NASDAQ, nor shall it be listed over-the-counter. Upon the written request of a holder of New Class B Common Stock, and in compliance with the provisions of the Certification of Incorporation, the shares of New Class B Common Stock shall be exchangeable into the same number of shares of New Class A Common Stock. Shares of Preferred Stock may be issued in one or more classes or series from time to time, with each such class or series to consist of such number of shares and to have such designations, powers, preferences and relative, participating, optional or other rights, if any, and the qualifications, limitations or restrictions thereof, if any, with respect to each such class or series as shall be stated in the resolution or resolutions providing for the issuance of such class or series adopted by the Board. 2020 Reverse Stock Split In May 2020, the Predecessor Company’s board of directors (our “Board”) approved a reverse stock split of the Company’s issued and outstanding common stock on a one Share repurchase program In May 2019, the Predecessor Company’s board of directors approved an authorization for a total share repurchase of up to $100 million of the Predecessor Company’s common stock to be executed through open market or private transactions. The authorization expired on May 14, 2020. In 2019 we repurchased approximately 3.0 million shares of common stock at an average price of $3.34 per share for a total of $9.9 million. Initial Public Offering of Common Stock The Predecessor Company completed an initial public offering (“IPO”) of 22.4 million shares of common stock at a price to the public of $18.00 per share, of which 18.1 million shares were sold by the Company and 4.3 million shares were sold by one of our stockholders, a subsidiary of Chesapeake Energy Corporation. The shares began trading on The New York Stock Exchange on February 2, 2018, under the ticker symbol “FTSI.” The Predecessor Company received net proceeds from the offering of $303.0 million, after offering costs. We used the net proceeds from the offering for general corporate purposes, primarily debt repayments. The Predecessor Company did not receive any proceeds from the offering of shares by the selling stockholder. IPO Reverse Stock Split In connection with the IPO, the Predecessor Company amended and restated our certificate of incorporation to effect a 69.258777:1 reverse stock split of our common stock. Convertible Preferred Stock In September 2012, the Predecessor Company issued and sold 350,000 shares of Series A convertible preferred stock, par value $0.01 per share (the “Preferred Stock”), to certain of our then existing common stockholders. The Preferred Stock was sold for aggregate consideration of $350 million, and resulted in net proceeds to the Predecessor Company of $349.8 million after the payment of $0.2 million in issuance costs. Each share of Preferred Stock was convertible into 2,573 shares of our common stock, subject to adjustment upon the occurrence of specified events set forth under terms of the Preferred Stock. The Preferred Stock was redeemable at the Predecessor Company’s option at any time after all of our debt was repaid. The redemption price per share was an amount in cash equal to the original price per share of the Preferred Stock, plus such additional amount as would give the holder an after-tax internal rate of return for investment in the Preferred Stock of 25% per annum (the “Accreted Amount”). At December 31, 2017, the Accreted Amount of the Preferred Stock was estimated to be $1,132.7 million. The Preferred Stock was mandatorily convertible into shares of our common stock in connection with an initial public offering of our common stock if both of the following conditions were met (a “Qualified IPO”): ● Aggregate proceeds to the Predecessor Company were at least $250 million; and ● The split-adjusted initial offering price to the public was not less than $1.50 per share. In connection with a Qualified IPO, each share of Preferred Stock would be convertible into the number of shares of common stock that had a market value (based on the initial offering price to the public) equal to the Accreted Amount. The Preferred Stock was mandatorily redeemable for cash upon a change of control, provided that all of our debt had been repaid. Each share of Preferred Stock would be redeemed for an amount in cash equal to the higher of: ● The Accreted Amount; or ● The original purchase price of the Preferred Stock plus an amount equal to 20% of the then outstanding equity value of the Predecessor Company divided by the number of Preferred Stock shares then outstanding. The Preferred Stock ranked senior to our common stock with respect to dividend rights and distribution rights in the event of any liquidation, winding-up or dissolution of the Predecessor Company. The amount that each share of Preferred Stock was entitled to in liquidation is equal to the Accreted Amount. The holders of the Preferred Stock were also common stockholders of the Predecessor Company and, prior to the completion of our initial public offering, collectively appointed 100% of our board of directors. Therefore, the Preferred Stock holders could have directed the Predecessor Company to redeem the Preferred Stock at any time after all of our debt had been repaid; however, we did not consider this to be probable for any of the periods the Preferred Stock was outstanding due to the amount of debt outstanding at that time. Therefore, we did not record any accretion of the Preferred Stock in our consolidated financial statements. In connection with the IPO, a number of shares of our Preferred Stock converted into common stock at the rate of 155.944841 shares of common stock per each share of Preferred Stock. All remaining shares of Preferred Stock were canceled. We refer to this conversion and the cancelation together as the recapitalization of the Preferred Stock. The conversion rate of the Preferred Stock and shares canceled were calculated so that following the recapitalization, stockholders that did not own Preferred Stock would own 7% of our common stock prior to the IPO. The recapitalization of all outstanding shares of our Preferred Stock resulted in 39.4 million new shares of common stock. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2020 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | NOTE 9 — STOCK-BASED COMPENSATION Predecessor 2014 Long-Term Incentive Plan In 2014, our stockholders approved the 2014 Long-Term Incentive Plan (“2014 LTIP”). The 2014 LTIP authorized the grant of up to 55 million restricted stock units (“RSUs”) to salaried employees of the Company, as determined by the compensation committee of the board of directors. This plan originally was set to expire on March 3, 2024. In February 2018, we completed an IPO of our common stock. This transaction qualified as the final vesting condition for these RSUs. The compensation expense recognized in 2018 for the stock-settled RSUs was $2.0 million. The compensation expense recognized in 2018 for the cash-settled RSUs was $1.7 million. The Company elected to settle the stock-settled RSUs in cash. The 2014 LTIP was terminated after the payout of the RSUs. Predecessor 2018 Equity and Incentive Compensation Plan Our board of directors and stockholders adopted the 2018 Equity and Incentive Compensation Plan (“2018 Plan”) to attract and retain officers, employees, directors, consultants and other key personnel and to provide those persons incentives and awards for performance. The 2018 Plan originally allocated 2.8 million shares of common stock in the form of incentive stock options, non-qualified stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights, or other stock-based awards. In 2019 our board of directors and stockholders amended and restated the 2018 Plan to increase the number of shares available for issuance by 3.6 million shares. Any shares that become available as a result of forfeiture, cancelation, expiration or cash settlement of an award are allowed to be granted again at a future date under the 2018 Plan. This plan originally was set to expire on February 1, 2028, but was terminated upon emergence from bankruptcy on November 19, 2020. RSUs are generally valued at the market price of a share of our common stock on the date of grant. Awards granted to employees generally vest over a three The following table summarizes the January 1 through November 19, 2020 transactions related to the RSUs granted under the Predecessor Company’s 2018 Plan. Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at January 1, 2020 179 $ 209.23 Granted — — Vested (174) 209.11 Forfeited (5) 213.74 Unvested balance at November 19, 2020 — $ — Stock-based compensation expense for the Predecessor Company from January 1 through November 19, 2020 for these RSUs was $10.9 million and was $15.4 million in 2019. There were no shares granted in 2020. The weighted-average grant-date fair value per share of RSUs granted was $51.22 in 2019. The fair value of RSUs vested was $36.3 million and $15.8 million in 2020 and 2019, respectively. At November 19, 2020, there was zero total unrecognized compensation cost related to unvested RSUs. The total income tax benefit (expense) for all stock-based compensation was $(0.1) million and $1.2 million in 2020 and 2019 respectively; however, such benefit (expense) was substantially offset by the valuation allowance against our deferred tax assets. Successor 2020 Equity and Incentive Compensation Plan As part of the Plan, the Successor Company adopted the 2020 Equity and Incentive Compensation Plan (“2020 Plan”) to attract and retain officers, employees, directors, consultants and other key personnel and to provide those persons incentives and awards for performance. The 2020 Plan originally allocated 2,160 thousand shares of common stock in the form of incentive stock options, non-qualified stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights, or other stock-based awards. As of December 31, 2020, up to approximately 1,080 thousand shares were available for future grants under this plan. Restricted Stock Units: Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at November 20, 2020 — $ — Granted 540 14.11 Vested — — Forfeited — — Unvested balance at December 31, 2020 540 $ 14.11 Stock-based compensation expense for the Successor Company from November 20 through December 31, 2020 for these RSUs was $0.2 million in 2020. The weighted-average grant-date fair value per share of RSUs granted was $14.11 in 2020. The fair value of RSUs vested was zero in 2020. At December 31, 2020, there was $7.4 million of total unrecognized compensation cost related to unvested RSUs, which is expected to be recognized over a weighted average period of 3.9 years. The total income tax benefit for all stock-based compensation was $0.1 million in 2020; however, such benefit was substantially offset by the valuation allowance against our deferred tax assets. Performance-based Restricted Stock Unit:. Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at November 20, 2020 — $ — Granted 270 10.91 Vested — — Forfeited — — Unvested balance at December 31, 2020 270 $ — Stock-based compensation expense for the Successor Company from November 20 through December 31, 2020 for these performance-based RSUs was $0.1 million in 2020. The weighted-average grant-date fair value per share of performance-based RSUs granted was $10.91 in 2020. The fair value of RSUs vested was zero in 2020. At December 31, 2020, there was $2.9 million of total unrecognized compensation cost related to unvested RSUs, which is expected to be recognized over a weighted average period of 3.9 years. The fair value of the performance-based RSUs was determined using a Monte Carlo simulation method. Assumptions used in calculating the fair value of the performance-based RSUs granted during the year are summarized below: 2020 Performance-based Valuation assumptions: RSU's Granted Expected dividend yield 0% Expected equity volatility, including peers 59.04% Expected term (years) 7 years Risk-free interest rate 0.62% Non-qualified stock options: Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at November 20, 2020 — $ — Granted 270 7.85 Vested — — Forfeited — — Unvested balance at December 31, 2020 270 $ — Stock-based compensation expense for the Successor Company from November 20 through December 31, 2020 for these stock options was $0.1 million in 2020. The weighted-average grant-date fair value per share of performance-based RSUs granted was $7.85 in 2020. The fair value of RSUs vested was zero in 2020. At December 31, 2020, there was $2.0 million of total unrecognized compensation cost related to unvested RSUs, which is expected to be recognized over a weighted average period of 3.9 years. The fair value of the stock options is determined by applying the Black-Scholes model. Assumptions used in calculating the fair value of the stock options granted during the year are summarized below: 2020 Options Valuation assumptions: Granted Expected dividend yield 0% Expected equity volatility 60.31% Expected term (years) 10 years Risk-free interest rate 0.53% |
RETIREMENT PLAN
RETIREMENT PLAN | 12 Months Ended |
Dec. 31, 2020 | |
RETIREMENT PLAN | |
RETIREMENT PLAN | NOTE 10 — RETIREMENT PLAN We offer a 401(k) defined contribution retirement plan (“401(k) Plan”), which allows a participant to defer, by payroll deductions, from 0% to 100% of the participant’s annual compensation, limited to certain annual maximums set by the Internal Revenue Code. The 401(k) Plan has historically provided a discretionary matching contribution to each participant’s account. Company matching contributions to the 401(k) Plan are made in cash and were $2.5 million, and $4.1 million in 2019 and 2018, respectively. The Company suspended matching contributions in January 2020. As a result, there were zero company matching contributions to the 401 |
IMPAIRMENTS AND OTHER CHARGES
IMPAIRMENTS AND OTHER CHARGES | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block | |
IMPAIRMENTS AND OTHER CHARGES | NOTE 11 — IMPAIRMENTS AND OTHER CHARGES The following table summarizes our impairments and other charges: Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 Supply commitment charges $ — $ 9.1 $ 58.5 $ 19.2 Impairment of assets — — 9.7 — Inventory write-down — 5.1 6.4 — Transaction costs — 18.5 — — Employee severance costs — 1.0 — — Loss on contract termination 0.3 0.4 — — Total impairments and other charges $ 0.3 $ 34.1 $ 74.6 $ 19.2 Transaction Costs From January 1 through November 19, 2020, in preparation for, and prior to filing our Chapter 11 Cases, the Predecessor Company incurred and paid $7.0 million in legal and professional fees and $11.5 million to certain holders of our Term Loan Agreement and Secured Notes pursuant to the Restructuring Support Agreement. Supply Commitment Charges The Predecessor Company incurred supply commitment charges when our purchases of sand from certain suppliers are less than the minimum purchase commitments in our supply contracts. According to the accounting guidance for firm purchase commitments, future losses that are considered likely are also required to be recorded in the current period. The Predecessor Company recorded aggregate charges under these supply contracts of $9.1 million from January 1 through November 19, 2020, and $58.5 million and $19.2 million in 2019 and 2018, respectively. These charges relate to actual purchase shortfalls incurred, as well as forecasted losses expected to be incurred and settled in future periods. These purchase shortfalls are largely due to our customers choosing to procure their own sand, often from sand mines closer to their operating areas. In May 2019, the Predecessor Company restructured and amended our largest sand supply contract to reduce the total remaining commitment through 2024 by approximately $162 million. This reduced our annual commitment from $47.9 million to $21.0 million from 2019 through 2024. Due to the terms of the amended agreement and our estimated future purchases under this contract, we determined that we would not be able to satisfy $11.0 million of the $21.0 million annual commitment with sand purchases for the last five years of the contract. Therefore, in connection with this amendment, we recorded a supply commitment charge of $55.0 million in the first quarter of 2019 to accelerate these purchase shortfalls. After recording the $55.0 million supply commitment charge in the first quarter of 2019, the amount of accrued supply commitment charges for future periods that was recognized on our consolidated balance sheet at March 31, 2019 was $66.0 million. We paid $11.0 million of this amount in the second quarter of 2019 and we expected to pay the remaining $55.0 million in annual installments of $11.0 million from January 2020 through January 2024. The remaining amount of the 2019 charges represent revised estimates of our purchase shortfalls under this contract for 2019. The Company terminated all sand supply contracts upon emergence from bankruptcy. Any amounts due as outlined in the Plan were paid upon emergence and the Company does not expect any future commitment related to these Predecessor contracts. Fleet Capacity Reduction In the fourth quarter of 2019, the Predecessor Company disposed of certain idle equipment where we believed there was no expectation of future use. The equipment we selected for disposal was comprised primarily of hydraulic fracturing pumps that were substantially depreciated. Certain hydraulic fracturing components, such as engines and transmissions that we believe to have remaining useful lives, will be removed prior to disposing of the equipment and used in our maintenance and repair activities for our remaining fleets. These disposals reduced our capacity of equipment from 34 total fleets to 28 total fleets. The amount of proceeds we received from these disposals was not significant. We recorded an asset impairment of $4.2 million in the third quarter of 2019 in connection with these disposals. Discontinued Wireline Operations In May 2019, the Predecessor Company discontinued our wireline operations due to financial underperformance resulting from market conditions. As a result of this decision, we recorded an asset impairment of $2.8 million and an inventory write-down of $1.4 million in the first quarter of 2019 to adjust these assets to their estimated fair market values and net realizable values, respectively. We sold substantially all of these assets in 2019 and received net proceeds of approximately $3.7 million. Other Impairments In the second quarter of 2019, the Predecessor Company recorded $2.7 million of impairments for certain land and buildings that we no longer use. We are closely monitoring current industry conditions and future expectations. If industry conditions decline, we may be subject to impairments of long-lived assets or intangible assets in future periods. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
INCOME TAXES | NOTE 12 — INCOME TAXES The following table summarizes the components of income tax expense (benefit): Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 Current: Federal $ — $ — $ — $ — State — 0.2 0.5 2.0 Foreign — — 0.9 — Total current — 0.2 1.4 2.0 Total deferred — — — — Income tax expense $ — $ 0.2 $ 1.4 $ 2.0 Actual income tax expense (benefit) differed from the amount computed by applying the statutory federal income tax rate to income (loss) before income taxes as follows: Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 (Loss) income before income taxes $ (13.4) $ (24.2) $ (71.5) $ 260.4 Statutory federal income tax rate 21.0 % 21.0 % 21.0 % 21.0 % Federal income tax (benefit) expense at statutory rate (2.8) (5.1) (15.0) 54.7 State income tax (benefit) expense, net of federal effect (0.2) (1.6) (0.1) 5.5 Effect of changes in income apportionment amongst states — (3.6) 12.0 6.1 Stock-based compensation — 7.4 2.1 0.3 Reorganization adjustments 0.3 577.1 — — Other items, net 0.1 1.0 1.7 (0.1) Change in valuation allowance 2.6 (575.0) 0.7 (64.5) Income tax expense $ 0.0 $ 0.2 $ 1.4 $ 2.0 Effective tax rate (0.0) % (0.8) % (2.0) % 0.8 % Due to the mobile nature of our operations, the apportionment of annual income that we earn in a state can change as the operations of our business adjust to market conditions. States have different income tax rates and therefore the weighted-average state tax rate that we apply to our taxable and deductible temporary differences and net operating loss carryforwards can also change over time. The resulting effects of state apportionment on our deferred tax assets and deferred tax liabilities are recognized to reflect the future impact of these changes and affects our overall effective tax rate; however, these changes are currently offset by corresponding changes in our valuation allowance. In March 2020, the President of the United States signed into law the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). The CARES Act includes several U.S. income tax provisions related to, among other things, net operating loss carrybacks, alternative minimum tax credits, modifications to the net interest deduction limitations, and technical amendments regarding the income tax depreciation of qualified improvement property placed in service after December 31, 2017. The CARES Act is not expected to have a material impact on the Company’s financial results. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented below: Successor Predecessor December 31, December 31, (In millions) 2020 2019 Deferred tax assets: Goodwill and intangible assets $ 19.5 $ 257.5 Federal net operating loss carryforwards 65.6 359.3 State net operating loss carryforwards, net of federal benefit 2.6 43.9 Interest carryforward 9.6 0.1 Accrued liabilities 0.8 13.7 Operating lease liability 1.4 6.2 Stock-based compensation 0.1 2.2 Other 0.8 2.2 Gross deferred tax assets 100.4 685.1 Valuation allowance (99.3) (671.7) Total deferred tax assets 1.1 13.4 Deferred tax liabilities: Property, plant, and equipment 0.1 7.6 Operating lease right-of-use assets 1.0 5.8 Total deferred tax liabilities 1.1 13.4 Net deferred tax asset $ — $ — Because of our valuation allowance, our net deferred tax assets are zero and no deferred tax assets or liabilities are included in the consolidated balance sheets. At December 31, 2020, our gross federal net operating loss carryforwards were approximately $312.5 million, of which $40.1 million will expire on various dates between 2032 and 2036 with the remaining losses carried forward indefinitely. Our gross state net operating loss carryforwards were approximately $54.0 million, of which $16.4 million will expire at various dates between 2021-2040 with the remaining carried forward indefinitely On August 22, 2020, we entered into a restructuring support agreement with certain of our note holders and lenders (collectively the “consenting creditors”). The restructuring support agreement included a cash premium payable to the consenting creditors. The cash premium was considered a significant modification of the notes and term loan for tax purposes. Under the Internal Revenue Code (IRC), the significant modification created cancellation of debt (COD) income to the Company, part of which is excluded from taxable income due to special rules under IRC Section 108. However, the excluded amount does reduce the Company’s NOL. IRC Section 382 provides an annual limitation with respect to the ability of a corporation to utilize its tax attributes, as well as certain built-in-losses, against future U.S. taxable income in the event of a change in ownership. The Company’s emergence from Chapter 11 bankruptcy proceedings is considered a change in ownership for purposes of IRC Section 382. The limitation under the IRC is based on the value of the corporation as of the emergence date. As a result of the Section 382 “ownership change”, our pre-Chapter 11 federal NOLs were significantly reduced to approximately At each reporting date, we consider all available positive and negative evidence to evaluate whether our deferred tax assets are more likely than not to be realized. The primary positive evidence we noted was: ● Cumulative income before income taxes for the three years ended December 31, 2020, was $151.3 million. The primary negative evidence we noted was: ● Our loss before income taxes was $71.5 million in 2019, and $24.2 million and $13.4 million for the Predecessor and Successor periods of 2020, respectively. ● We filed for bankruptcy in 2020. ● The forecasts of our results and the consensus forecasts of the hydraulic fracturing industry have been historically volatile due to the up-and-down cycles experienced by the industry. ● We do not have prudent and feasible tax-planning strategies available to us to realize deferred tax assets. Notwithstanding the three-year cumulative income, we concluded that a full valuation allowance is still required at December 31, 2020. We based this conclusion on the positive and negative evidence discussed above. If we generate income before income taxes in future periods and if our forecasts become more accurate due to the cycles of the hydraulic fracturing industry becoming less significant, we may be able to recognize a portion of our net deferred tax assets in future periods. We will adjust the valuation allowance based on our evaluation of new information as it becomes available and new circumstances as they occur. At December 31, 2020 and 2019, we had no liability for uncertain tax positions. We recognize interest and penalties related to UTBs on the income tax expense line in the accompanying consolidated statement of operations. FTS International, Inc. and its U.S. subsidiaries join in the filing of a U.S. federal consolidated income tax return. We do not currently have significant operations or undistributed earnings in foreign jurisdictions. Our income tax returns are currently subject to examination in federal and state jurisdictions primarily for tax years from 2016 through 2019. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 13 — COMMITMENTS AND CONTINGENCIES Purchase Obligations At December 31, 2020, the Successor Company’s future minimum purchase commitments is summarized below: (In millions) 2021 2022 2023 2024 2025 Thereafter Other purchase obligations 0.3 0.3 0.3 0.1 — — Total purchase obligations $ 0.3 $ 0.3 $ 0.3 $ 0.1 $ — $ — Litigation In the ordinary course of business, we are subject to various legal proceedings and claims, some of which may not be covered by insurance. Some of these legal proceedings and claims are in early stages, and many of them seek an indeterminate amount of damages. We estimate and provide for potential losses that may arise out of legal proceedings and claims to the extent that such losses are probable and can be reasonably estimated. Significant judgment is required in making these estimates and our final liabilities may ultimately be materially different from these estimates. When preparing our estimates, we consider, among other factors, the progress of each legal proceeding and claim, our experience and the experience of others in similar legal proceedings and claims, and the opinions and views of legal counsel. Legal costs related to litigation contingencies are expensed as incurred. With respect to the litigation matters below, if there is an adverse outcome individually or collectively, there could be a material adverse effect on the Company’s consolidated financial position or results of operations. These litigation matters are subject to inherent uncertainties and management’s view of these matters may change in the future. Therefore, there can be no assurance as to the ultimate outcome of these matters. Regardless of the outcome, any such litigation and claims can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Patterson v. FTS International Manufacturing, LLC and FTS International Services, LLC Securities Act Litigation We believe that costs associated with other legal matters will not have a material adverse effect on our consolidated financial statements. |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
EARNINGS (LOSS) PER SHARE | |
EARNINGS (LOSS) PER SHARE | NOTE 14 — EARNINGS (LOSS) PER SHARE The numerators and denominators of the basic and diluted earnings (loss) per share (“EPS”) computations for our common stock are calculated as follows: Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions, except per share amounts) 2020 2020 2019 2018 Numerator: Net (loss) income $ (13.4) $ (24.4) $ (72.9) $ 258.4 Convertible preferred stock accretion — — — — Net reversal of convertible preferred stock — — — 423.2 Net (loss) income attributable to common $ (13.4) $ (24.4) $ (72.9) $ 681.6 Denominator: Weighted average shares used for 13,990 5,377 5,440 5,208 Effect of dilutive securities: Restricted stock units (2) — — — — Dilutive potential common shares — — — — Number of shares used for 13,990 5,377 5,440 5,208 Basic and diluted EPS $ (0.96) $ (4.54) $ (13.40) $ 130.88 (1) The weighted average shares outstanding has been adjusted to give effect to a 69.258777 : 1 reverse stock split that occurred in February 2018 in connection with the completion of our IPO and the 20 : 1 reverse stock split in May 2020. (2) The dilutive effect of employee restricted stock units granted under our 2018 LTIP and 2020 LTIP was either immaterial or antidilutive for 2020, 2019 and 2018. (3) The accreted value of our Preferred Stock was $1,132.7 million at December 31, 2017. In connection with our IPO, the Preferred Stock was recapitalized into 39.4 million shares of common stock. These shares of common stock had a value of $709.5 million at the IPO share price of $18.00 , which resulted in a net reversal of $423.2 million of convertible preferred stock accretion previously recognized. |
SELECTED QUARTERLY DATA (UNAUDI
SELECTED QUARTERLY DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2020 | |
SELECTED QUARTERLY DATA (UNAUDITED) | |
SELECTED QUARTERLY DATA (UNAUDITED) | NOTE 15 — SELECTED QUARTERLY DATA (UNAUDITED) Predecessor Successor Period from Period from October 1, November 20, Three Months Ended through through March 31, June 30, September 30, November 19, December 31, (In millions, except per share amounts) 2020 2020 2020 2020 2020 Revenue Revenue $ 150.8 $ 29.5 $ 32.1 $ 27.2 $ 22.6 Revenue from related parties 0.7 — — — — Total revenue 151.5 29.5 32.1 27.2 22.6 Operating expenses Costs of revenue 114.6 28.9 30.7 23.0 24.1 Selling, general and administrative 17.7 13.2 11.8 5.1 4.7 Depreciation and amortization 21.4 20.2 17.8 9.1 4.8 Impairments and other charges 4.3 10.3 19.4 0.1 0.3 (Gain) loss on disposal of assets, net (0.1) 0.2 — — — Total operating expenses 157.9 72.8 79.7 37.3 33.9 Operating loss (6.4) (43.3) (47.6) (10.1) (11.3) Interest expense, net (7.3) (7.4) (7.4) — — Gain on extinguishment of debt, net 2.0 — — — — Equity in net loss of joint venture affiliate — — — — — Gain on sale of equity interest in joint venture affiliate — — — — — Reorganization items, net — — (13.7) 117.0 (2.1) Loss before income taxes (11.7) (50.7) (68.7) 106.9 (13.4) Income tax benefit — — — 0.2 — Net loss $ (11.7) $ (50.7) $ (68.7) $ 106.7 $ (13.4) Basic and diluted loss per share $ (2.18) $ (9.43) $ (12.77) $ 19.83 $ (0.96) Shares used in computing basic and 5,367 5,379 5,381 5,382 13,990 Predecessor Three Months Ended March 31, June 30, September 30, December 31, (In millions, except per share amounts) 2019 2019 2019 2019 Revenue Revenue $ 221.6 $ 225.8 $ 186.0 $ 142.3 Revenue from related parties 0.9 — — — Total revenue 222.5 225.8 186.0 142.3 Operating expenses Costs of revenue 162.1 164.8 145.5 101.5 Selling, general and administrative 23.6 21.7 21.1 22.7 Depreciation and amortization 22.4 22.8 22.7 22.1 Impairments and other charges (1) 61.8 3.9 6.8 2.1 Loss (gain) on disposal of assets, net 0.3 (1.2) (0.1) (0.4) Total operating expenses 270.2 212.0 196.0 148.0 Operating (loss) income (47.7) 13.8 (10.0) (5.7) Interest expense, net (8.2) (7.7) (7.6) (7.2) Gain (loss) on extinguishment of debt, net 0.5 (0.1) 0.8 — Equity in net income of joint venture affiliate 0.6 — — — Gain on sale of equity interest in joint venture affiliate — — 7.0 — (Loss) income before income taxes (54.8) 6.0 (9.8) (12.9) Income tax expense 0.2 0.1 1.0 0.1 Net (loss) income $ (55.0) $ 5.9 $ (10.8) $ (13.0) Net (loss) income attributable to common stockholders $ (55.0) $ 5.9 $ (10.8) $ (13.0) Basic and diluted (loss) earnings per share $ (10.03) $ 1.08 $ (1.99) $ (2.42) Shares used in computing basic and 5,483 5,484 5,430 5,365 (1) We recorded a supply commitment charge of $55.0 million in the first quarter of 2019 for expected losses from unconditional purchase obligations. See Note 11 — “Impairments and Other Charges” for more information . |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Policy Text Blocks | |
Basis of Presentation | Basis of Presentation We prepared the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of the Company and all majority-owned domestic and foreign subsidiaries. Investments over which we have the ability to exercise significant influence over operating and financial policies, but do not hold a controlling interest, are accounted for using the equity method of accounting. All significant intercompany accounts and transactions have been eliminated in consolidation. There were no items of other comprehensive income in the periods presented. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, related revenues and expenses, and the disclosure of gain and loss contingencies at the date of the financial statements and during the periods presented. We base these estimates on historical results and various other assumptions believed to be reasonable, all of which form the basis for making estimates concerning the carrying values of assets and liabilities that are not readily available from other sources. Actual results could differ materially from those estimates. |
Fresh Start Accounting | Fresh Start Accounting Upon emergence from bankruptcy the Company adopted fresh start accounting. Refer to Note 3 – Fresh Start Accounting for further details. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents include only investments with an original maturity of three months or less. We occasionally hold cash deposits in financial institutions that exceed federally insured limits. We monitor the credit ratings and our concentration of risk with these financial institutions on a continuing basis to safeguard our cash deposits. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at their invoiced amounts or amounts for which we have a right to invoice based on services completed. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments |
Inventories | Inventories Inventories primarily consist of maintenance parts that are used to service our hydraulic fracturing equipment but will also include proppants and chemicals that are used to provide hydraulic fracturing services. Inventory held as of our emergence date was remeasured to fair value. Subsequent to our emergence, inventories are stated at the lower of cost or net realizable value. The cost basis of our inventories is based on the average cost method and includes in-bound freight costs. As necessary, we record an adjustment to decrease the value of slow moving and obsolete inventory to its net realizable value. To determine the adjustment amount, we regularly review inventory quantities on hand and compare them to estimates of future product demand, market conditions, production requirements and technological developments. |
Restricted Cash | Restricted Cash The Company had $12.7 million and zero restricted cash at December 31, 2020 and 2019, respectively. At December 31, 2020 the company’s restricted cash included unsettled escrow fees related to our bankruptcy emergence and cash used as collateral for other banking products. |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment held as of our emergence date was remeasured to fair value and depreciated over the estimated remaining useful lives of individual assets. Property, plant, and equipment purchased subsequent to our emergence date is stated at cost less accumulated depreciation, which is generally provided by using the straight-line method over the estimated useful lives of the individual assets. We manufacture and refurbish equipment used in our hydraulic fracturing operations and the cost of this equipment, which includes direct and indirect manufacturing costs, is capitalized and carried as construction-in-progress until it is completed. Expenditures for renewals and betterments that extend the lives of our service equipment, which includes the replacement of significant components of service equipment, are capitalized and depreciated. Other repairs and maintenance costs are expensed as incurred. We capitalize qualifying costs related to the acquisition or development of internal-use software. Capitalization of costs begins after the conceptual formulation stage has been completed. Capitalized costs are amortized over the estimated useful life of the software, which ranges between three |
Leases | Leases We determine if a contract contains a lease at inception. We lease certain administrative offices, sales offices, and operational facilities. We also lease some service equipment and light duty vehicles. These leases have remaining lease terms of 6 years or less. Some leases contain options to extend the leases, and some include options to terminate the leases. We do not include renewal or termination options in our assessment of the lease terms unless extension or termination for certain leases is deemed to be reasonably certain. Lease agreements with lease and non-lease components are generally accounted for as a single lease component. Operating lease assets and liabilities are recognized at the lease commencement date, which is the date we take possession of the property. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease assets represent our right to use an underlying asset and are valued based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental secured borrowing rates corresponding to the lease term including reasonably certain renewal periods. We estimate this rate based on prevailing financial market conditions, credit analysis, and management judgment. Our leases typically contain rent escalations over the lease term. We recognize expense for these leases on a straight-line basis over the lease term. Additionally, tenant incentives used to fund leasehold improvements are recognized when earned and reduce our right-of-use asset related to the lease. These are amortized through the operating lease asset as reductions of expense over the lease term. We provide residual value guarantees for our leases of light-duty vehicles and certain service equipment. No amounts related to these residual value guarantees have been deemed probable and included in the lease liabilities on our consolidated balance sheet; however, if the value for all of the vehicles was zero and if we cancelled these leases at December 31, 2020, we would be required to pay a total of $5.6 million in residual value guarantees. |
Intangible Assets | Intangible Assets We have historically acquired indefinite-lived intangible assets related to business acquisitions. Intangible assets with indefinite lives are not amortized. The amount of indefinite-lived intangible assets recorded in our consolidated balance sheets for December 31, 2020, was $7.4 million, of which 6.0 million related to our tradename and $1.4 million related to our developed technology. At December 31, 2019, the amount of indefinite-lived intangible assets recorded in our consolidated balance sheets was $29.5 million which related to our tradename. On November 19, 2020, upon emergence from Chapter 11 bankruptcy our intangible assets were identified and valued at fair value and a finite life was assigned to our developed technology. We amortize this intangible asset with a finite life on a straight-line basis over a period of three years which the asset is expected to contribute to our future cash flows. |
Impairment of Long-Lived Assets and Intangible Assets | Impairment of Long-Lived Assets and Intangible Assets Long-lived assets, such as property, plant, equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Recoverability is assessed based on the undiscounted future cash flows generated by the asset or asset group. If the carrying amount of an asset or asset group is not recoverable, we recognize an impairment loss equal to the amount by which the carrying amount exceeds fair value. We estimate fair value based on the income, market, or cost valuation techniques. Intangible assets with indefinite lives are reviewed at least annually for impairment, and in interim periods if certain events occur indicating that the carrying value of intangible assets may be impaired. We estimate fair values utilizing valuation methods such as discounted cash flows and comparable market valuations. We perform our annual impairment tests at the beginning of the fourth quarter. |
Equity Method Investments | Equity Method Investments Investments in which we have the ability to exercise significant influence, but not control, are accounted for pursuant to the equity method of accounting. We recognize our proportionate share of earnings or losses of our international affiliates three months after they occur. When events and circumstances warrant, investments accounted for under the equity method of accounting are evaluated for impairment. An impairment charge is recorded whenever a decline in value of an investment below its carrying amount is determined to be other-than-temporary. |
Income Taxes | Income Taxes Income taxes are accounted for using the asset and liability method. Deferred taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The effect on deferred taxes for a change in tax rates is recognized in earnings in the period that includes the enactment date. We recognize future tax benefits to the extent that such benefits are more likely than not to be realized. We record a valuation allowance to reduce the value of a deferred tax asset if based on the consideration of all available evidence, it is more likely than not that all or some portion of the deferred tax asset will not be realized. Significant weight is given to evidence that can be objectively verified. We evaluate our deferred income taxes quarterly to determine if a valuation allowance is required by considering all available evidence, including historical and projected taxable income and tax planning strategies. We will adjust a previously established valuation allowance if we change our assessment of the amount of deferred income tax asset that is more likely than not to be realized. We record uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. |
Revenue Recognition | Revenue Recognition The Company contracts with its customers to perform hydraulic fracturing services on one or more oil or natural gas wells. Under these arrangements, we satisfy our performance obligations as services are rendered, which is generally upon the completion of a fracturing stage. We typically complete one or more stages per day. A stage is considered complete when we have met the specifications set forth by the customer, at which time we have the right to invoice the customer and the customer is obligated to pay us for the services rendered. The price for our services typically includes an equipment charge and product charges for proppant, chemicals and other products consumed during the course of providing our services. Payment terms average approximately two months from the date a stage or well is completed. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. We also contract with some customers to provide them with the exclusive use of a fracturing fleet for a period of time. Our customers can generally terminate these contracts with less than 90 days’ notice. We satisfy our performance obligation as services are rendered, which is based on the passage of time rather than the completion of a stage. Under these arrangements, we have the right to receive consideration from a customer even if circumstances outside of our control prevent us from performing our work. All consideration owed to us for services performed during a period is fixed and our right to receive it is unconditional. Pricing for our services for all contracts is frequently negotiated with our customers and is based on prevailing market rates during each reporting period. The amounts we invoice our customers for services performed during a period are directly related to the value received by the customers for the period. There is no inherent uncertainty to the amount of consideration we will receive for services performed during a period and no judgment is required to allocate a portion of the transaction price to a future period. Accordingly, we are not required to identify any unsatisfied performance obligations nor attribute any revenue to them. During the periods presented we acted as a principal, rather than as an agent, for all of the goods and services that we provided to our customers; our customer arrangements did not include obligations for refunds or warranties of our work; our revenue does not include sales taxes collected from our customers; and we did not incur incremental costs to obtain or fulfill contracts with our customers. To comply with the FASB disclosure objective, we are required to disaggregate our revenue into categories if it will provide an enhanced understanding of how the nature, amount, timing, and uncertainty of our revenue and cash flows are affected by economic factors. To evaluate an appropriate level of disaggregation of revenue, we considered the following aspects of our business: ● We provide a single service to our customers. ● We only generate revenue in the U.S. onshore market. ● We have a homogeneous customer base, which is comprised of large oil and gas exploration companies. ● We provide our service over a short period of time. ● We do not disaggregate our revenue into categories for any external communications or to make resource allocation decisions. ● We do not have separate operating segments. Based on the above factors, we concluded that no additional disaggregation of revenue was necessary or meaningful to help depict the nature, amount, timing and uncertainty of our revenues and cash flows. |
Unconditional Purchase Obligations | Unconditional Purchase Obligations We have historically entered into supply arrangements, primarily for sand, with our vendors that contain unconditional purchase obligations. These represent obligations to transfer funds in the future for fixed or minimum quantities of goods at fixed or minimum prices. We enter into these unconditional purchase obligation arrangements in the normal course of business to ensure that adequate levels of sourced product are available to us. We currently do not have any such supply agreements. To account for these arrangements, we must monitor whether we may be required to make a minimum payment to a vendor in a future period because our projected inventory purchases may not satisfy our minimum commitments. |
Stock-Based Compensation | Stock-Based Compensation We measure all employee stock-based compensation awards using a fair value method and record this cost in the consolidated financial statements. Our stock-based compensation relates to restricted stock units issued to our employees. On the date that an equity-classified award is granted, we determine the fair value of the award and recognize the compensation cost over the requisite service period, which typically is the period over which the award vests. For equity-classified awards with graded vesting based solely on the satisfaction of a service condition, we recognize compensation cost as a single award on a straight-line basis. We account for forfeited awards as forfeitures occur, which results in a reversal of stock-based compensation cost previously recognized up to the date of the forfeiture. For stock-based awards with performance conditions that affect vesting, we only recognize compensation cost when it is probable that the performance conditions will be met. |
Fair Value of Financial Instruments | Fair Value Measurements Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at a measurement date. We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: ● Level One: The use of quoted prices in active markets for identical financial instruments. ● Level Two: The use of quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or other inputs that are observable in the market or can be corroborated by observable market data. ● Level Three: The use of significant unobservable inputs that typically require the use of management’s estimates of assumptions that market participants would use in pricing. Money market funds, classified as cash and cash equivalents, are the only financial instruments that are measured and recorded at fair value on the Company’s balance sheets. The following table presents money market funds at their level within the fair value hierarchy. (In millions) Total Level 1 Level 2 Level 3 December 31, 2020 (Successor) Money market funds $ 59.6 $ 59.6 $ — $ — December 31, 2019 (Predecessor) Money market funds $ 193.6 $ 193.6 $ — $ — |
Reclassifications | Reclassifications All inventory write-downs have been reclassified from costs of revenue to impairments and other charges on the statements of operations to conform to current year presentation. This reclassification had no effect on operating income (loss) or net income (loss) as previously reported. |
New Accounting Standards Updates | New Accounting Standards Updates In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases embedded leases and we identified the key terms that were necessary for us to calculate the right-of-use asset and lease liability. These consolidated financial statements have been prepared in accordance with the new ASU utilizing the modified retrospective transition method, which resulted in the recording of operating lease liabilities of approximately $38 million as of January 1, 2019 on our consolidated balance sheet with an immaterial effect on our consolidated statement of stockholders’ equity (deficit) and no related effect on our consolidated statement of operations. In November 2016, the FASB issued ASU 2016-18, Restricted Cash Successor Predecessor December 31, December 31, (In millions) 2020 2019 Cash and cash equivalents $ 94.0 $ 223.0 Restricted cash included in prepaid expenses and other current assets 12.7 — Total cash, cash equivalents, and restricted cash shown in the $ 106.7 $ 223.0 In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments |
FRESH START ACCOUNTING (Tables)
FRESH START ACCOUNTING (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
FRESH START ACCOUNTING | |
Schedule of reconciliation of the Company's enterprise value to the fair value of the Successor's common | November 19, (In millions) 2020 Enterprise value $ 266.3 Plus: Excess cash (1) 13.3 Fair value of Successor equity $ 279.6 November 19, (In millions) 2020 Enterprise value $ 266.3 Plus: Excess cash (1) 13.3 Plus: Current liabilities 36.4 Plus: Non-interest-bearing non-current liabilities 6.2 Reorganization value of Successor assets $ 322.2 |
Schedule of Company's consolidated balance sheet due to the reorganization and fresh start accounting adjustments. | As of November 19, 2020 (in millions) Predecessor Reorganization Fresh Start Successor Company Adjustments Adjustments Company ASSETS Current assets Cash and cash equivalents $ 146.7 $ (58.4) (a) $ — $ 88.3 Accounts receivable, net 30.1 — — 30.1 Inventories 33.5 — (2.2) (k) 31.3 Prepaid expenses and other current assets 19.0 10.1 (b) (5.3) (l) 23.8 Total current assets 229.3 (48.3) (7.5) 173.5 Property, plant, and equipment, net 177.2 — (42.0) (m) 135.2 Operating lease right-of-use assets 4.7 — — 4.7 Intangible assets, net 29.5 — (22.1) (n) 7.4 Other assets 1.4 0.2 (c) (0.2) (o) 1.4 Total assets $ 442.1 $ (48.1) $ (71.8) $ 322.2 LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY Current liabilities Accounts payable $ 20.3 $ 0.8 (d) $ — $ 21.1 Accrued expenses 11.6 0.2 (e) — 11.8 Current portion of operating lease liabilities 3.2 — — 3.2 Other current liabilities 12.8 (12.5) (f) — 0.3 Total current liabilities 47.9 (11.5) — 36.4 Operating lease liabilities 3.4 — — 3.4 Other liabilities 2.8 — — 2.8 Liabilities subject to compromise 488.8 (488.8) (g) — — Total liabilities 542.9 (500.3) — 42.6 Stockholders’ Common stock - Predecessor 36.4 (36.4) (h) — — Additional paid-in capital - Predecessor 4,392.9 (4,392.9) (h) — — Common stock - Successor — 0.1 (i) — 0.1 Additional paid-in capital - Successor — 279.5 (i) — 279.5 Accumulated deficit (4,530.1) 4,601.9 (j) (71.8) (p) — Total stockholders’ (deficit) equity (100.8) 452.2 (71.8) 279.6 Total liabilities and stockholders’ (deficit) equity $ 442.1 $ (48.1) $ (71.8) $ 322.2 |
Schedule of Change in cash and cash equivalents | November 19, (In millions) 2020 Transfer of payment for professional fees and success fees to escrow account recorded in prepaid expenses and other current assets $ (9.1) Payment of professional and success fees (4.9) Payment to secured debtholders (30.7) Payment of Covia settlement (12.5) Payment of emergence date bonus (1.0) Payment of debt issuance costs related to Successor Revolving Credit Facility (0.2) Change in cash and cash equivalents $ (58.4) |
Schedule of Change in prepaid expenses and other current assets | November 19, (In millions) 2020 Transfer of payment for professional fees and success fees from cash and cash equivalent $ 9.1 Payment of emergence date bonus 1.0 Change in prepaid expenses and other current assets $ 10.1 |
Schedule of liabilities subject to compromise and the pre-tax gain on the settlement of liabilities subject to compromise as follows. | November 19, (In millions) 2020 2022 Senior Notes $ 379.0 Term Loan 67.6 Supply commitment charges 42.2 Total liabilities subject to compromise 488.8 Issuance of New Common Stock to holders of 2022 Senior Notes (202.0) Issuance of New Common Stock to Term Loan lenders (36.1) Issuance of New Common Stock to unsecured claimholders (2.2) Payment to holders of 2022 Senior Notes (26.0) Payment to Term Loan lenders (4.7) Pre-tax gain on settlement of liabilities subject to compromise $ 217.8 |
Schedule of reorganization adjustments made to the Successor common stock and Successor additional paid-in capital | November 19, (In millions) 2020 Fair value of New Common Stock issued to holders of the 2022 Senior Notes claims $ 202.0 Fair value of New Common Stock issued to holders of the Term Loan claims 36.1 Fair value of New Common Stock issued to holders of the unsecured claims 2.2 Fair value of New Common Stock issued to holders of legacy equity interests 24.9 Fair value of warrants issued to legacy equity interests 14.4 Total Successor common stock and additional paid-in capital 279.6 Less: Successor common stock (0.1) Successor additional paid-in capital $ 279.5 |
Schedule of cumulative net impact of the following transactions on Predecessor accumulated deficit | November 19, (In millions) 2020 Pre-tax gain on settlement of liabilities subject to compromise as calculated in note f) $ 217.8 Acceleration of Predecessor stock-based compensation (15.3) Cancellation of Predecessor common stock and additional paid-in capital 4,444.4 Success fees recognized on the Effective Date (5.7) Issuance of Successor common stock to legacy equity interests (24.9) Issuance of warrants to legacy equity interests (14.4) Change in accumulated deficit $ 4,601.9 |
Schedule of Reorganization Items | Successor Predecessor Period from Period from November 20, January 1, through through December 31, November 19, (In millions) 2020 2020 Pre-tax gain on settlement of liabilities subject to compromise $ — $ 217.8 Fresh start accounting adjustments — (71.8) Professional service provider fees and other expenses (1.9) (9.5) Success fees for professional service providers — (5.7) Derecognition of unamortized debt discounts and issuance costs — (2.5) Terminated executory contracts — (9.7) Acceleration of Predecessor stock-based compensation expense — (15.3) Other Costs (0.2) — (Loss)/gain on reorganization items, net $ (2.1) $ 103.3 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of recurring fair value measurements | (In millions) Total Level 1 Level 2 Level 3 December 31, 2020 (Successor) Money market funds $ 59.6 $ 59.6 $ — $ — December 31, 2019 (Predecessor) Money market funds $ 193.6 $ 193.6 $ — $ — |
Schedule of cash and cash equivalents and restricted cash | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Cash and cash equivalents $ 94.0 $ 223.0 Restricted cash included in prepaid expenses and other current assets 12.7 — Total cash, cash equivalents, and restricted cash shown in the $ 106.7 $ 223.0 |
SUPPLEMENTAL BALANCE SHEET IN_2
SUPPLEMENTAL BALANCE SHEET INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SUPPLEMENTAL BALANCE SHEET INFORMATION | |
Schedule of Accounts Receivable | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Trade accounts receivable $ 30.6 $ 80.3 Allowance for doubtful accounts (3.7) (3.3) Accounts receivable, net $ 26.9 $ 77.0 |
Schedule of change in allowance for doubtful accounts | Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 Balance at beginning of period $ 3.7 $ 3.3 $ 0.9 $ 2.1 Provision for bad debts, net included in selling, general, — 0.8 2.4 — Uncollectible receivables written off — (0.4) — (1.2) Balance at end of period $ 3.7 $ 3.7 $ 3.3 $ 0.9 |
Schedule of Inventories | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Maintenance parts $ 27.9 $ 43.0 Proppants and chemicals 1.0 2.3 Other 0.1 0.2 Total inventories $ 29.0 $ 45.5 |
Schedule of Prepaid Expenses and Other Current Assets | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Restricted cash $ 12.7 $ — Prepaid expenses $ 6.7 $ 4.4 Other 0.1 2.6 Total prepaid expenses and other current assets $ 19.5 $ 7.0 |
Schedule of Property, Plant and Equipment, net | Successor Predecessor Estimated December 31, December 31, Useful Life (Dollars in millions) 2020 2019 (in years) Service equipment $ 92.1 $ 797.2 2.5 – 10 Buildings and improvements 21.6 63.3 15 – 39 Office, software, and other equipment 0.5 44.4 3 – 7 Vehicles and transportation equipment 0.3 6.5 5 – 20 Land 8.4 7.0 N/A Construction-in-process and other 14.1 20.1 N/A Total property, plant, and equipment 137.0 938.5 Accumulated depreciation and amortization (4.7) (711.5) Total property, plant, and equipment, net $ 132.3 $ 227.0 |
Schedule of Accrued Expenses | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Sales, use, and property taxes $ 4.8 $ 7.1 Employee compensation and benefits 5.6 8.0 Interest — 4.1 Insurance 2.0 3.1 Other 0.1 0.6 Total accrued expenses $ 12.5 $ 22.9 |
Schedule of other current liabilities | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Accrued supply commitment charges $ — $ 11.3 Other 0.3 0.3 Total other current liabilities $ 0.3 $ 11.6 |
Schedule of other liabilities | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Accrued supply commitment charges $ — $ 44.0 Other 2.4 1.6 Total other liabilities $ 2.4 $ 45.6 |
INDEBTEDNESS AND BORROWING FA_2
INDEBTEDNESS AND BORROWING FACILITY (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Blocks | |
Summary of long-term debt | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Term loan due April 2021 $ — $ 90.0 Senior notes due May 2022 — 369.9 Total principal amount — 459.9 Less unamortized discount and debt issuance costs — (3.0) Total long-term debt $ — $ 456.9 Estimated fair value of long-term debt $ — $ 317.2 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
Summary of components of our lease costs and other supplemental information for our operating leases | Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 Operating lease cost $ 0.3 $ 12.7 $ 21.1 Short-term lease cost 0.4 4.7 5.8 Total lease cost $ 0.7 $ 17.4 $ 26.9 Successor Predecessor Period from Period from November 20, January 1, through through Year Ended December 31, November 19, December 31, (Dollars in millions) 2020 2020 2019 Cash paid for amounts included in the measurement of our lease liabilities $ 0.3 $ 12.9 21.3 Right-of-use assets obtained in exchange for lease liabilities $ 0.1 $ 0.6 11 Right-of-use assets recognized upon adoption of the leasing standard $ — $ — 37.8 Weighted-average remaining lease term 2.9 years 2.9 years 2.3 years Weighted-average discount rate 4.9% 4.9% 5.0% |
Summary of maturity of our operating leases | Successor December 31, (In millions) 2020 2021 $ 3.2 2022 1.3 2023 1.2 2024 1.1 2025 — 2026 and thereafter — Total lease payments 6.8 Less imputed interest (0.5) Total lease liabilities $ 6.3 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Restricted Stock Awards | 2020 Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of restricted stock and restricted stock units activity | Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at November 20, 2020 — $ — Granted 540 14.11 Vested — — Forfeited — — Unvested balance at December 31, 2020 540 $ 14.11 |
Employee restricted stock units | 2018 Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of restricted stock and restricted stock units activity | Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at January 1, 2020 179 $ 209.23 Granted — — Vested (174) 209.11 Forfeited (5) 213.74 Unvested balance at November 19, 2020 — $ — |
Performance Based Restricted Stock Units | 2020 Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of restricted stock and restricted stock units activity | Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at November 20, 2020 — $ — Granted 270 10.91 Vested — — Forfeited — — Unvested balance at December 31, 2020 270 $ — |
Schedule of Share-based Payment Award, Equity Instruments Other Than Options, Valuation Assumptions [Table Text Block] | 2020 Performance-based Valuation assumptions: RSU's Granted Expected dividend yield 0% Expected equity volatility, including peers 59.04% Expected term (years) 7 years Risk-free interest rate 0.62% |
Non-qualified stock options | 2020 Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of restricted stock and restricted stock units activity | Weighted- Number Average of Units Grant-Date (In thousands) Fair Value Unvested balance at November 20, 2020 — $ — Granted 270 7.85 Vested — — Forfeited — — Unvested balance at December 31, 2020 270 $ — |
Schedule of Share-based Payment Award, Equity Instruments Other Than Options, Valuation Assumptions [Table Text Block] | 2020 Options Valuation assumptions: Granted Expected dividend yield 0% Expected equity volatility 60.31% Expected term (years) 10 years Risk-free interest rate 0.53% |
IMPAIRMENTS AND OTHER CHARGES (
IMPAIRMENTS AND OTHER CHARGES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Table Text Blocks | |
Schedule of impairments and other charges | Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 Supply commitment charges $ — $ 9.1 $ 58.5 $ 19.2 Impairment of assets — — 9.7 — Inventory write-down — 5.1 6.4 — Transaction costs — 18.5 — — Employee severance costs — 1.0 — — Loss on contract termination 0.3 0.4 — — Total impairments and other charges $ 0.3 $ 34.1 $ 74.6 $ 19.2 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
Schedule of components of income tax expense (benefit) | Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 Current: Federal $ — $ — $ — $ — State — 0.2 0.5 2.0 Foreign — — 0.9 — Total current — 0.2 1.4 2.0 Total deferred — — — — Income tax expense $ — $ 0.2 $ 1.4 $ 2.0 |
Schedule of reconciliation of income tax expense (benefit) | Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions) 2020 2020 2019 2018 (Loss) income before income taxes $ (13.4) $ (24.2) $ (71.5) $ 260.4 Statutory federal income tax rate 21.0 % 21.0 % 21.0 % 21.0 % Federal income tax (benefit) expense at statutory rate (2.8) (5.1) (15.0) 54.7 State income tax (benefit) expense, net of federal effect (0.2) (1.6) (0.1) 5.5 Effect of changes in income apportionment amongst states — (3.6) 12.0 6.1 Stock-based compensation — 7.4 2.1 0.3 Reorganization adjustments 0.3 577.1 — — Other items, net 0.1 1.0 1.7 (0.1) Change in valuation allowance 2.6 (575.0) 0.7 (64.5) Income tax expense $ 0.0 $ 0.2 $ 1.4 $ 2.0 Effective tax rate (0.0) % (0.8) % (2.0) % 0.8 % |
Schedule of deferred tax assets and deferred tax liabilities | Successor Predecessor December 31, December 31, (In millions) 2020 2019 Deferred tax assets: Goodwill and intangible assets $ 19.5 $ 257.5 Federal net operating loss carryforwards 65.6 359.3 State net operating loss carryforwards, net of federal benefit 2.6 43.9 Interest carryforward 9.6 0.1 Accrued liabilities 0.8 13.7 Operating lease liability 1.4 6.2 Stock-based compensation 0.1 2.2 Other 0.8 2.2 Gross deferred tax assets 100.4 685.1 Valuation allowance (99.3) (671.7) Total deferred tax assets 1.1 13.4 Deferred tax liabilities: Property, plant, and equipment 0.1 7.6 Operating lease right-of-use assets 1.0 5.8 Total deferred tax liabilities 1.1 13.4 Net deferred tax asset $ — $ — |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
Summary of future minimum purchase commitments | (In millions) 2021 2022 2023 2024 2025 Thereafter Other purchase obligations 0.3 0.3 0.3 0.1 — — Total purchase obligations $ 0.3 $ 0.3 $ 0.3 $ 0.1 $ — $ — |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
EARNINGS (LOSS) PER SHARE | |
Schedule of computations for basic and diluted earnings (loss) per share | Successor Predecessor Period from Period from November 20, January 1, through through Years Ended December 31, November 19, December 31, (In millions, except per share amounts) 2020 2020 2019 2018 Numerator: Net (loss) income $ (13.4) $ (24.4) $ (72.9) $ 258.4 Convertible preferred stock accretion — — — — Net reversal of convertible preferred stock — — — 423.2 Net (loss) income attributable to common $ (13.4) $ (24.4) $ (72.9) $ 681.6 Denominator: Weighted average shares used for 13,990 5,377 5,440 5,208 Effect of dilutive securities: Restricted stock units (2) — — — — Dilutive potential common shares — — — — Number of shares used for 13,990 5,377 5,440 5,208 Basic and diluted EPS $ (0.96) $ (4.54) $ (13.40) $ 130.88 (1) The weighted average shares outstanding has been adjusted to give effect to a 69.258777 : 1 reverse stock split that occurred in February 2018 in connection with the completion of our IPO and the 20 : 1 reverse stock split in May 2020. (2) The dilutive effect of employee restricted stock units granted under our 2018 LTIP and 2020 LTIP was either immaterial or antidilutive for 2020, 2019 and 2018. (3) The accreted value of our Preferred Stock was $1,132.7 million at December 31, 2017. In connection with our IPO, the Preferred Stock was recapitalized into 39.4 million shares of common stock. These shares of common stock had a value of $709.5 million at the IPO share price of $18.00 , which resulted in a net reversal of $423.2 million of convertible preferred stock accretion previously recognized. |
SELECTED QUARTERLY DATA (UNAU_2
SELECTED QUARTERLY DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SELECTED QUARTERLY DATA (UNAUDITED) | |
Schedule of quarterly financial data | Predecessor Successor Period from Period from October 1, November 20, Three Months Ended through through March 31, June 30, September 30, November 19, December 31, (In millions, except per share amounts) 2020 2020 2020 2020 2020 Revenue Revenue $ 150.8 $ 29.5 $ 32.1 $ 27.2 $ 22.6 Revenue from related parties 0.7 — — — — Total revenue 151.5 29.5 32.1 27.2 22.6 Operating expenses Costs of revenue 114.6 28.9 30.7 23.0 24.1 Selling, general and administrative 17.7 13.2 11.8 5.1 4.7 Depreciation and amortization 21.4 20.2 17.8 9.1 4.8 Impairments and other charges 4.3 10.3 19.4 0.1 0.3 (Gain) loss on disposal of assets, net (0.1) 0.2 — — — Total operating expenses 157.9 72.8 79.7 37.3 33.9 Operating loss (6.4) (43.3) (47.6) (10.1) (11.3) Interest expense, net (7.3) (7.4) (7.4) — — Gain on extinguishment of debt, net 2.0 — — — — Equity in net loss of joint venture affiliate — — — — — Gain on sale of equity interest in joint venture affiliate — — — — — Reorganization items, net — — (13.7) 117.0 (2.1) Loss before income taxes (11.7) (50.7) (68.7) 106.9 (13.4) Income tax benefit — — — 0.2 — Net loss $ (11.7) $ (50.7) $ (68.7) $ 106.7 $ (13.4) Basic and diluted loss per share $ (2.18) $ (9.43) $ (12.77) $ 19.83 $ (0.96) Shares used in computing basic and 5,367 5,379 5,381 5,382 13,990 Predecessor Three Months Ended March 31, June 30, September 30, December 31, (In millions, except per share amounts) 2019 2019 2019 2019 Revenue Revenue $ 221.6 $ 225.8 $ 186.0 $ 142.3 Revenue from related parties 0.9 — — — Total revenue 222.5 225.8 186.0 142.3 Operating expenses Costs of revenue 162.1 164.8 145.5 101.5 Selling, general and administrative 23.6 21.7 21.1 22.7 Depreciation and amortization 22.4 22.8 22.7 22.1 Impairments and other charges (1) 61.8 3.9 6.8 2.1 Loss (gain) on disposal of assets, net 0.3 (1.2) (0.1) (0.4) Total operating expenses 270.2 212.0 196.0 148.0 Operating (loss) income (47.7) 13.8 (10.0) (5.7) Interest expense, net (8.2) (7.7) (7.6) (7.2) Gain (loss) on extinguishment of debt, net 0.5 (0.1) 0.8 — Equity in net income of joint venture affiliate 0.6 — — — Gain on sale of equity interest in joint venture affiliate — — 7.0 — (Loss) income before income taxes (54.8) 6.0 (9.8) (12.9) Income tax expense 0.2 0.1 1.0 0.1 Net (loss) income $ (55.0) $ 5.9 $ (10.8) $ (13.0) Net (loss) income attributable to common stockholders $ (55.0) $ 5.9 $ (10.8) $ (13.0) Basic and diluted (loss) earnings per share $ (10.03) $ 1.08 $ (1.99) $ (2.42) Shares used in computing basic and 5,483 5,484 5,430 5,365 (1) We recorded a supply commitment charge of $55.0 million in the first quarter of 2019 for expected losses from unconditional purchase obligations. See Note 11 — “Impairments and Other Charges” for more information . |
DESCRIPTION OF BUSINESS- (Detai
DESCRIPTION OF BUSINESS- (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Aug. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2014 | |
Equity ownership interest | 45.00% | ||||
Consideration received | $ 26.9 | $ 30.7 | |||
Royalties received | $ 5.8 | 2 | |||
Gain on sale of equity interest in joint venture affiliate | $ 7 | $ 7 | |||
Prepaid royalty fee recognition period | 6 years | ||||
SinoFTS Petroleum Services Ltd. | |||||
Percentage of ownership in joint venture | 45.00% | ||||
Sinopec | SinoFTS Petroleum Services Ltd. | |||||
Percentage of ownership in joint venture | 55.00% |
DESCRIPTION OF BUSINESS - Conce
DESCRIPTION OF BUSINESS - Concentrations of Risk (Details) | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
6 customers with over 10% of revenue | ||||
Concentrations of Risk | ||||
Concentration risk (as a percent) | 81.00% | |||
2 customres with over 10% of revenue | ||||
Concentrations of Risk | ||||
Concentration risk (as a percent) | 26.00% | 24.00% | ||
1 customer with over 10% of revenue | ||||
Concentrations of Risk | ||||
Concentration risk (as a percent) | 12.00% |
DESCRIPTION OF BUSINESS - Relat
DESCRIPTION OF BUSINESS - Related Parties (Details) - USD ($) $ in Millions | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | ||||||
Revenue from related parties | $ 0.7 | $ 0.9 | $ 0.7 | $ 0.9 | $ 92.9 | |
Chesapeake | ||||||
Related Party Transaction [Line Items] | ||||||
Outstanding common stock held by related party (as a percent) | 20.00% | |||||
Revenue from related parties | $ 0.7 | 0.1 | 92.9 | |||
Accounts receivable from related parties | 0 | 0 | ||||
SinoFTS | ||||||
Related Party Transaction [Line Items] | ||||||
Proceeds from sale of equipment | 0 | 0.9 | $ 0.3 | |||
Accounts receivable from related parties | $ 0 | $ 0 |
RESTRUCTURING (Details)
RESTRUCTURING (Details) - USD ($) $ in Millions | Nov. 19, 2020 | Dec. 31, 2020 |
Percentage of Proportionate Distribution Received by Common Share Holder's | 9.40% | 90.10% |
Pro rata cash distribution to common share holders | $ 30.7 | |
Covia contract dispute | ||
Percentage of Proportionate Distribution Received by Common Share Holder's | 0.50% | |
Pro rata cash distribution to common share holders | $ 12.5 | |
Senior Notes Due 2022 | ||
Debt Instrument, Interest Rate, Stated Percentage | 6.25% | |
Tranche One Warrants | ||
Warrants Issued | 1,555,521 | |
Tranche Two Warrants | ||
Warrants Issued | 3,888,849 |
FRESH START ACCOUNTING (Details
FRESH START ACCOUNTING (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 |
FRESH START ACCOUNTING | |||
Enterprise value | $ 266.3 | ||
Plus: Excess cash | $ 94 | 13.3 | $ 223 |
Fair value of Successor equity | $ 279.6 |
FRESH START ACCOUNTING - Reorga
FRESH START ACCOUNTING - Reorganization value of Successor assets (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 |
FRESH START ACCOUNTING | |||
Enterprise value | $ 266.3 | ||
Plus: Excess cash | $ 94 | 13.3 | $ 223 |
Plus: Current liabilities | $ 42.7 | 36.4 | $ 85.2 |
Plus: Non-interest-bearing non-current liabilities | 6.2 | ||
Reorganization value of Successor assets | $ 322.2 |
FRESH START ACCOUNTING - Consol
FRESH START ACCOUNTING - Consolidated Balance Sheet (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets | ||||||
Cash and cash equivalents | $ 94 | $ 13.3 | $ 223 | |||
Accounts receivable, net | 26.9 | 77 | ||||
Inventories | 29 | 45.5 | ||||
Prepaid expenses and other current assets | 19.5 | 7 | ||||
Total current assets | 169.4 | 352.5 | ||||
Property, plant, and equipment, net | 132.3 | 227 | ||||
Operating lease right-of-use assets | 4.5 | 26.3 | ||||
Intangible assets, net | 7.4 | 29.5 | ||||
Other assets | 1.4 | 4 | ||||
Total assets | 315 | 639.3 | ||||
Current liabilities | ||||||
Accounts payable | 26.9 | 36.4 | ||||
Accrued expenses | 12.5 | 22.9 | ||||
Current portion of operating lease liabilities | 3 | 14.3 | ||||
Other current liabilities | 0.3 | 11.6 | ||||
Total current liabilities | 42.7 | 36.4 | 85.2 | |||
Operating lease liabilities | 3.3 | 13.9 | $ 38 | |||
Other liabilities | 2.4 | 45.6 | ||||
Total liabilities | 48.4 | 601.6 | ||||
Stockholders' equity | ||||||
Common stock | 0.1 | 36.4 | ||||
Additional paid-in capital | 279.9 | 4,382 | ||||
Accumulated deficit | (13.4) | (4,380.7) | ||||
Total stockholders' equity | 266.6 | 279.6 | 37.7 | $ 106.9 | $ (818.3) | |
Total liabilities and stockholders' equity | $ 315 | $ 639.3 | ||||
Reorganization Adjustments | ||||||
Current assets | ||||||
Cash and cash equivalents | (58.4) | |||||
Prepaid expenses and other current assets | 10.1 | |||||
Total current assets | (48.3) | |||||
Other assets | 0.2 | |||||
Total assets | (48.1) | |||||
Current liabilities | ||||||
Accounts payable | 0.8 | |||||
Accrued expenses | 0.2 | |||||
Other current liabilities | (12.5) | |||||
Total current liabilities | (11.5) | |||||
Liabilities subject to compromise | (488.8) | |||||
Total liabilities | (500.3) | |||||
Stockholders' equity | ||||||
Accumulated deficit | 4,601.9 | |||||
Total stockholders' equity | 452.2 | |||||
Total liabilities and stockholders' equity | (48.1) | |||||
Fresh Start Accounting Adjustments | ||||||
Current assets | ||||||
Inventories | (2.2) | |||||
Prepaid expenses and other current assets | (5.3) | |||||
Total current assets | (7.5) | |||||
Property, plant, and equipment, net | (42) | |||||
Intangible assets, net | (22.1) | |||||
Other assets | (0.2) | |||||
Total assets | (71.8) | |||||
Stockholders' equity | ||||||
Accumulated deficit | (71.8) | |||||
Total stockholders' equity | (71.8) | |||||
Total liabilities and stockholders' equity | (71.8) | |||||
Predecessor Company | ||||||
Current assets | ||||||
Cash and cash equivalents | 146.7 | |||||
Accounts receivable, net | 30.1 | |||||
Inventories | 33.5 | |||||
Prepaid expenses and other current assets | 19 | |||||
Total current assets | 229.3 | |||||
Property, plant, and equipment, net | 177.2 | |||||
Operating lease right-of-use assets | 4.7 | |||||
Intangible assets, net | 29.5 | |||||
Other assets | 1.4 | |||||
Total assets | 442.1 | |||||
Current liabilities | ||||||
Accounts payable | 20.3 | |||||
Accrued expenses | 11.6 | |||||
Current portion of operating lease liabilities | 3.2 | |||||
Other current liabilities | 12.8 | |||||
Total current liabilities | 47.9 | |||||
Operating lease liabilities | 3.4 | |||||
Other liabilities | 2.8 | |||||
Liabilities subject to compromise | 488.8 | |||||
Total liabilities | 542.9 | |||||
Stockholders' equity | ||||||
Common stock | 36.4 | |||||
Additional paid-in capital | 4,392.9 | |||||
Accumulated deficit | (4,530.1) | |||||
Total stockholders' equity | (100.8) | |||||
Total liabilities and stockholders' equity | 442.1 | |||||
Predecessor Company | Reorganization Adjustments | ||||||
Stockholders' equity | ||||||
Common stock | (36.4) | |||||
Additional paid-in capital | (4,392.9) | |||||
Successor Company | ||||||
Current assets | ||||||
Cash and cash equivalents | 88.3 | |||||
Accounts receivable, net | 30.1 | |||||
Inventories | 31.3 | |||||
Prepaid expenses and other current assets | 23.8 | |||||
Total current assets | 173.5 | |||||
Property, plant, and equipment, net | 135.2 | |||||
Operating lease right-of-use assets | 4.7 | |||||
Intangible assets, net | 7.4 | |||||
Other assets | 1.4 | |||||
Total assets | 322.2 | |||||
Current liabilities | ||||||
Accounts payable | 21.1 | |||||
Accrued expenses | 11.8 | |||||
Current portion of operating lease liabilities | 3.2 | |||||
Other current liabilities | 0.3 | |||||
Total current liabilities | 36.4 | |||||
Operating lease liabilities | 3.4 | |||||
Other liabilities | 2.8 | |||||
Total liabilities | 42.6 | |||||
Stockholders' equity | ||||||
Common stock | 0.1 | |||||
Additional paid-in capital | 279.5 | |||||
Total stockholders' equity | 279.6 | |||||
Total liabilities and stockholders' equity | 322.2 | |||||
Successor Company | Reorganization Adjustments | ||||||
Current assets | ||||||
Cash and cash equivalents | 88.3 | |||||
Stockholders' equity | ||||||
Common stock | 0.1 | |||||
Additional paid-in capital | $ 279.5 |
FRESH START ACCOUNTING - Reor_2
FRESH START ACCOUNTING - Reorganization Adjustments to change in cash and cash equivalents (Details) - Reorganization Adjustments $ in Millions | 11 Months Ended |
Nov. 19, 2020USD ($) | |
Fresh Start Accounting | |
Change in cash and cash equivalents | $ (58.4) |
Fess paid | 1.9 |
Transfer of payment for professional fees and success fees to escrow account recorded in prepaid expenses and other current assets | |
Fresh Start Accounting | |
Change in cash and cash equivalents | (9.1) |
Payment of professional and success fees | |
Fresh Start Accounting | |
Change in cash and cash equivalents | (4.9) |
Fess paid | 4.9 |
Payment to secured debtholders | |
Fresh Start Accounting | |
Change in cash and cash equivalents | (30.7) |
Payment of Covia settlement | |
Fresh Start Accounting | |
Change in cash and cash equivalents | (12.5) |
Payment of emergence date bonus | |
Fresh Start Accounting | |
Change in cash and cash equivalents | (1) |
Payment of debt issuance costs related to Successor Revolving Credit Facility | |
Fresh Start Accounting | |
Change in cash and cash equivalents | (0.2) |
Payment of Success Fees Recognized Upon Emergence | |
Fresh Start Accounting | |
Change in cash and cash equivalents | $ 3.8 |
FRESH START ACCOUNTING - Reor_3
FRESH START ACCOUNTING - Reorganization Adjustments to prepaid expenses and other current assets (Details) $ in Millions | Nov. 19, 2020USD ($) |
Transfer of payment for professional fees and success fees from cash and cash equivalent | |
Fresh-Start Adjustment [Line Items] | |
Change in prepaid expenses and other current assets | $ 9.1 |
Reorganization Adjustments | |
Fresh-Start Adjustment [Line Items] | |
Change in prepaid expenses and other current assets | 10.1 |
Reorganization Adjustments | Transfer of payment for professional fees and success fees from cash and cash equivalent | |
Fresh-Start Adjustment [Line Items] | |
Change in prepaid expenses and other current assets | 9.1 |
Reorganization Adjustments | Payment of emergence date bonus | |
Fresh-Start Adjustment [Line Items] | |
Change in prepaid expenses and other current assets | $ 1 |
FRESH START ACCOUNTING - Liabil
FRESH START ACCOUNTING - Liabilities subject to compromise (Details) - Reorganization Adjustments $ in Millions | Nov. 19, 2020USD ($) |
Fresh Start Accounting | |
Total Liabilities subject to compromise | $ 488.8 |
2022 Senior Notes | |
Fresh Start Accounting | |
Total Liabilities subject to compromise | (379) |
Term Loan | |
Fresh Start Accounting | |
Total Liabilities subject to compromise | (67.6) |
Supply commitment charges | |
Fresh Start Accounting | |
Total Liabilities subject to compromise | $ (42.2) |
FRESH START ACCOUNTING - Pre-ta
FRESH START ACCOUNTING - Pre-tax gain on settlement of liabilities (Details) $ in Millions | 11 Months Ended |
Nov. 19, 2020USD ($) | |
Fresh Start Accounting | |
Pre-tax gain on settlement of liabilities subject to compromise | $ 217.8 |
Reorganization Adjustments | |
Fresh Start Accounting | |
Pre-tax gain on settlement of liabilities subject to compromise | 217.8 |
Reorganization Adjustments | Issuance of New Common Stock to holders of 2022 Senior Notes | |
Fresh Start Accounting | |
Pre-tax gain on settlement of liabilities subject to compromise | (202) |
Reorganization Adjustments | Issuance of New Common Stock to Term Loan lenders | |
Fresh Start Accounting | |
Pre-tax gain on settlement of liabilities subject to compromise | (36.1) |
Reorganization Adjustments | Issuance of New Common Stock to unsecured claimholders | |
Fresh Start Accounting | |
Pre-tax gain on settlement of liabilities subject to compromise | (2.2) |
Reorganization Adjustments | Payment to holders of 2022 Senior Notes | |
Fresh Start Accounting | |
Pre-tax gain on settlement of liabilities subject to compromise | (26) |
Reorganization Adjustments | Payment to Term Loan lenders | |
Fresh Start Accounting | |
Pre-tax gain on settlement of liabilities subject to compromise | $ (4.7) |
FRESH START ACCOUNTING - Succes
FRESH START ACCOUNTING - Successor common stock and additional paid in capital (Details) $ in Millions | Nov. 19, 2020USD ($) |
Fresh Start Accounting | |
Less: Successor common stock | $ (0.1) |
Successor additional paid-in capital | 279.5 |
Fair value of New Common Stock issued to holders of the 2022 Senior Notes claims | |
Fresh Start Accounting | |
Less: Successor common stock | 202 |
Fair value of New Common Stock issued to holders of the Term Loan claims | |
Fresh Start Accounting | |
Less: Successor common stock | 36.1 |
Fair value of New Common Stock issued to holders of the unsecured claims | |
Fresh Start Accounting | |
Less: Successor common stock | 2.2 |
Fair value of New Common Stock issued to holders of legacy equity interests | |
Fresh Start Accounting | |
Less: Successor common stock | 24.9 |
Fair value of warrants issued to legacy equity interests | |
Fresh Start Accounting | |
Less: Successor common stock | 14.4 |
Total Successor common stock and additional paid-in capital | |
Fresh Start Accounting | |
Less: Successor common stock | $ 279.6 |
FRESH START ACCOUNTING - Cumula
FRESH START ACCOUNTING - Cumulative net impact (Details) $ in Millions | Nov. 19, 2020USD ($) |
Fresh Start Accounting | |
Change in accumulated deficit | $ 0 |
Reorganization Adjustments | |
Fresh Start Accounting | |
Change in accumulated deficit | 4,601.9 |
Reorganization Adjustments | Pre-tax gain on settlement of liabilities subject to compromise as calculated in note f | |
Fresh Start Accounting | |
Change in accumulated deficit | 217.8 |
Reorganization Adjustments | Acceleration of Predecessor stock-based compensation | |
Fresh Start Accounting | |
Change in accumulated deficit | (15.3) |
Reorganization Adjustments | Cancellation of Predecessor common stock and additional paid-in capital | |
Fresh Start Accounting | |
Change in accumulated deficit | 4,444.4 |
Reorganization Adjustments | Success fees recognized on the Effective Date | |
Fresh Start Accounting | |
Change in accumulated deficit | (5.7) |
Reorganization Adjustments | Issuance of Successor common stock to legacy equity interests | |
Fresh Start Accounting | |
Change in accumulated deficit | (24.9) |
Reorganization Adjustments | Issuance of warrants to legacy equity interests | |
Fresh Start Accounting | |
Change in accumulated deficit | $ (14.4) |
FRESH START ACCOUNTING - Reor_4
FRESH START ACCOUNTING - Reorganization Items (Details) - USD ($) $ in Millions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 11 Months Ended |
Dec. 31, 2020 | Nov. 19, 2020 | Sep. 30, 2020 | Nov. 19, 2020 | |
FRESH START ACCOUNTING | ||||
Pre-tax gain on settlement of liabilities subject to compromise | $ 217.8 | |||
Fresh start accounting adjustments | (71.8) | |||
Professional service provider fees and other expenses | $ (1.9) | (9.5) | ||
Success fees for professional service providers | (5.7) | |||
Derecognition of unamortized debt discounts and issuance costs | (2.5) | |||
Terminated executory contracts | (9.7) | |||
Acceleration of Predecessor stock-based compensation expense | (15.3) | |||
Other Costs | 0.2 | |||
(Loss)/gain on reorganization items, net | $ (2.1) | $ 117 | $ (13.7) | $ 103.3 |
FRESH START ACCOUNTING - Additi
FRESH START ACCOUNTING - Additional information (Details) $ in Millions | 11 Months Ended | ||
Nov. 19, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Fresh-Start Adjustment [Line Items] | |||
Change in accumulated deficit | $ 0 | ||
Enterprise value | 266.3 | ||
Cash and cash equivalents | $ 13.3 | $ 94 | $ 223 |
Risk-free rate | |||
Fresh-Start Adjustment [Line Items] | |||
Stock price | 0.22 | ||
Expected dividend yield | |||
Fresh-Start Adjustment [Line Items] | |||
Stock price | 0 | ||
Expected volatility | |||
Fresh-Start Adjustment [Line Items] | |||
Stock price | 65 | ||
Tranche One Warrants | Exercise price | |||
Fresh-Start Adjustment [Line Items] | |||
Stock price | 33.04 | ||
Tranche Two Warrants | Exercise price | |||
Fresh-Start Adjustment [Line Items] | |||
Stock price | 37.14 | ||
Minimum | |||
Fresh-Start Adjustment [Line Items] | |||
Enterprise value | $ 190 | ||
Maximum | |||
Fresh-Start Adjustment [Line Items] | |||
Enterprise value | 290 | ||
Reorganization Adjustments | |||
Fresh-Start Adjustment [Line Items] | |||
Change in accumulated deficit | $ 4,601.9 | ||
Maximum Percentage of Voting Shares of Emerging Entity that Existing Voting Shares | 50.00% | ||
Cash and cash equivalents | $ (58.4) | ||
Minimum Cash Required to Operate Business | 75 | ||
Fess paid | 1.9 | ||
Adjustment to accounts payable | 3.8 | ||
Accrued professional fees | 3 | ||
Adjustment to other current liabilities | 12.5 | ||
Stock based compensation | 15.1 | ||
Write-off of prepaid premium | 5.3 | ||
Write-off of debt issuance costs | (0.2) | ||
Contractual interest expense | 4.4 | ||
Successor Company | |||
Fresh-Start Adjustment [Line Items] | |||
Cash and cash equivalents | 88.3 | ||
Successor Company | Reorganization Adjustments | |||
Fresh-Start Adjustment [Line Items] | |||
Cash and cash equivalents | $ 88.3 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Restricted Cash, Goodwill and Intangible Assets (Details) - USD ($) $ in Millions | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Intangible Assets | |||
Restricted cash | $ 12.7 | $ 0 | |
Intangible assets, net | 7.4 | $ 29.5 | |
Intangible asset with a finite life | 3 years | ||
Tradename | |||
Intangible Assets | |||
Intangible assets, net | 6 | ||
Developed technology | |||
Intangible Assets | |||
Intangible assets, net | $ 1.4 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property, Plant and Equipment (Details) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor |
Computer software | |||||
Property, Plant and Equipment | |||||
Unamortized balance of capitalized costs | $ 0.2 | $ 0.2 | $ 0.4 | ||
Amortization | $ 0 | $ 0.3 | $ 3.4 | $ 4.2 | |
Computer software | Minimum | |||||
Property, Plant and Equipment | |||||
Estimated useful life | 3 years | ||||
Computer software | Maximum | |||||
Property, Plant and Equipment | |||||
Estimated useful life | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Leases (Details) $ in Millions | Dec. 31, 2020USD ($) |
LEASES | |
Remaining lease terms | 6 years |
Residual owed if value of leased assets is zero | $ 5.6 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - New Accounting Standard Updates (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 |
Lessee assets and liabilities | |||
Operating Lease, Liability, Noncurrent | $ 3.3 | $ 13.9 | $ 38 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value Measurements | ||
Money market funds | $ 59.6 | $ 193.6 |
Level 1 | ||
Fair Value Measurements | ||
Money market funds | $ 59.6 | $ 193.6 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash and Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Cash, restricted cash and cash equivalents | |||||
Cash and cash equivalents | $ 94 | $ 13.3 | $ 223 | ||
Restricted cash included in prepaid expenses and other current assets | 12.7 | 0 | |||
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | 106.7 | $ 105.3 | 223 | $ 177.8 | $ 217.2 |
Accounting Standards Update 2016-18 | |||||
Cash, restricted cash and cash equivalents | |||||
Cash and cash equivalents | 94 | 223 | |||
Restricted cash included in prepaid expenses and other current assets | 12.7 | ||||
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 106.7 | $ 223 |
SUPPLEMENTAL BALANCE SHEET IN_3
SUPPLEMENTAL BALANCE SHEET INFORMATION - (Details) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accounts receivable | ||||
Trade accounts receivable | $ 30.6 | $ 80.3 | ||
Allowance for doubtful accounts | (3.7) | (3.3) | ||
Accounts receivable, net | 26.9 | 77 | ||
Allowance for doubtful accounts | ||||
Balance at beginning of period | 3.7 | $ 3.3 | 0.9 | $ 2.1 |
Provision for bad debts, net included in selling, general, and administrative expense | 0.8 | 2.4 | ||
Uncollectible receivables written off | (0.4) | (1.2) | ||
Balance at end of period | 3.7 | $ 3.7 | 3.3 | $ 0.9 |
Inventories | ||||
Maintenance parts | 27.9 | 43 | ||
Proppants and chemicals | 1 | 2.3 | ||
Other | 0.1 | 0.2 | ||
Total inventories | 29 | 45.5 | ||
Prepaid expenses and other current assets | ||||
Restricted cash | 12.7 | 0 | ||
Prepaid expenses | 6.7 | 4.4 | ||
Other | 0.1 | 2.6 | ||
Total prepaid expenses and other current assets | $ 19.5 | $ 7 |
SUPPLEMENTAL BALANCE SHEET IN_4
SUPPLEMENTAL BALANCE SHEET INFORMATION - Property, Plant and Equipment - (Details) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment | |||||
Total property, plant, and equipment | $ 137 | $ 137 | $ 938.5 | ||
Accumulated depreciation and amortization | (4.7) | (4.7) | (711.5) | ||
Total property, plant, and equipment, net | 132.3 | 132.3 | 227 | ||
Depreciation expense | 4.7 | $ 68.5 | 90 | $ 84.7 | |
Service equipment | |||||
Property, Plant and Equipment | |||||
Total property, plant, and equipment | 92.1 | $ 92.1 | 797.2 | ||
Service equipment | Minimum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 2 years 6 months | ||||
Service equipment | Maximum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 10 years | ||||
Buildings and improvements | |||||
Property, Plant and Equipment | |||||
Total property, plant, and equipment | 21.6 | $ 21.6 | 63.3 | ||
Buildings and improvements | Minimum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 15 years | ||||
Buildings and improvements | Maximum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 39 years | ||||
Office, software, and other equipment | |||||
Property, Plant and Equipment | |||||
Total property, plant, and equipment | 0.5 | $ 0.5 | 44.4 | ||
Office, software, and other equipment | Minimum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 3 years | ||||
Office, software, and other equipment | Maximum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 7 years | ||||
Vehicles and transportation equipment | |||||
Property, Plant and Equipment | |||||
Total property, plant, and equipment | 0.3 | $ 0.3 | 6.5 | ||
Vehicles and transportation equipment | Minimum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 5 years | ||||
Vehicles and transportation equipment | Maximum | |||||
Property, Plant and Equipment | |||||
Estimated Useful Life (in years) | 20 years | ||||
Land | |||||
Property, Plant and Equipment | |||||
Total property, plant, and equipment | 8.4 | $ 8.4 | 7 | ||
Construction-in-process and other | |||||
Property, Plant and Equipment | |||||
Total property, plant, and equipment | $ 14.1 | $ 14.1 | $ 20.1 |
SUPPLEMENTAL BALANCE SHEET IN_5
SUPPLEMENTAL BALANCE SHEET INFORMATION - Accrued Expenses and Other Current Liabilities - (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Accrued expenses | ||
Sales, use, and property taxes | $ 4.8 | $ 7.1 |
Employee compensation and benefits | 5.6 | 8 |
Interest | 4.1 | |
Insurance | 2 | 3.1 |
Other | 0.1 | 0.6 |
Total accrued expenses | 12.5 | 22.9 |
Other Current liabilities | ||
Accrued supply commitment charges | 11.3 | |
Other | 0.3 | 0.3 |
Total other current liabilities | 0.3 | 11.6 |
Other liabilities | ||
Accrued supply commitment charges | 44 | |
Other | 2.4 | 1.6 |
Total other liabilities | $ 2.4 | $ 45.6 |
INDEBTEDNESS AND BORROWING FA_3
INDEBTEDNESS AND BORROWING FACILITY - Summary of Long-term Debt (Details) - USD ($) $ in Millions | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||||
Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
INDEBTEDNESS | ||||||||
Total principal amount | $ 459.9 | |||||||
Less unamortized discount and debt issuance costs | (3) | |||||||
Total long-term debt | 456.9 | |||||||
Estimated fair value of total debt | 317.2 | |||||||
Gain (loss) on extinguishment of debt, net | $ 2 | $ 0.8 | $ (0.1) | $ 0.5 | $ 2 | 1.2 | $ (9.8) | |
2020 Senior Floating Rate Notes | ||||||||
INDEBTEDNESS | ||||||||
Principal amount repaid | 290 | |||||||
Gain (loss) on extinguishment of debt, net | 8.3 | |||||||
Term Loan | ||||||||
INDEBTEDNESS | ||||||||
Total principal amount | 90 | |||||||
Principal amount repaid | $ 22.6 | 31 | ||||||
Gain (loss) on extinguishment of debt, net | 2 | 0.2 | ||||||
Senior secured Notes | ||||||||
INDEBTEDNESS | ||||||||
Total principal amount | 369.9 | |||||||
Principal amount repaid | $ 0 | 17 | 22.1 | |||||
Gain (loss) on extinguishment of debt, net | $ 1.4 | $ 1.2 |
INDEBTEDNESS AND BORROWING FA_4
INDEBTEDNESS AND BORROWING FACILITY - Revolving Credit Facility (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2020 | Nov. 19, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | Feb. 22, 2018 | |
Revolving credit facility | ||||||
Revolving Credit Facility | ||||||
Credit facility sub limit amount | $ 15 | |||||
Borrowing base on line of credit | $ 17.2 | |||||
Maximum borrowing capacity | $ 100 | $ 250 | ||||
Minimum credit facility percentage | 12.50% | |||||
Minimum maintained credit facility | $ 5 | |||||
Fixed coverage ratio | 1.00% | |||||
Revolving credit | $ 0 | |||||
Maximum borrowing credit facility | $ 13.2 | |||||
Percentage of commitment fee | 0.375% | |||||
Revolving credit facility | Minimum | ||||||
Revolving Credit Facility | ||||||
Maximum borrowing capacity | $ 100 | |||||
Margin rate | 2.25% | |||||
Revolving credit facility | Maximum | ||||||
Revolving Credit Facility | ||||||
Margin rate | 2.50% | |||||
Revolving credit facility | LIBOR | ||||||
Revolving Credit Facility | ||||||
Margin rate | 0.75% | |||||
Interest borrowing on credit facility | LIBOR | |||||
Revolving credit facility | Wells Fargo, N.A | ||||||
Revolving Credit Facility | ||||||
Maximum borrowing capacity | $ 40 | $ 40 | $ 250 | |||
Letter of Credit | ||||||
Revolving Credit Facility | ||||||
Revolving credit | $ 4 |
INDEBTEDNESS AND BORROWING FA_5
INDEBTEDNESS AND BORROWING FACILITY - Senior Notes and Term Loan (Details) - USD ($) $ in Millions | Jun. 01, 2015 | Apr. 16, 2014 | Dec. 31, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
CHAPTER 11 BANKRUPTCY PROCEEDINGS | |||||||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | ||||||
Gain (loss) on extinguishment of debt, net | $ 2 | $ 0.8 | $ (0.1) | $ 0.5 | $ 2 | $ 1.2 | $ (9.8) | ||||
2020 Senior Floating Rate Notes | |||||||||||
CHAPTER 11 BANKRUPTCY PROCEEDINGS | |||||||||||
Debt instruments, Face amount | $ 350 | ||||||||||
Margin rate | 7.50% | ||||||||||
Principal amount repaid | 290 | ||||||||||
Gain (loss) on extinguishment of debt, net | 8.3 | ||||||||||
Senior secured Notes | |||||||||||
CHAPTER 11 BANKRUPTCY PROCEEDINGS | |||||||||||
Debt instruments, Face amount | $ 500 | ||||||||||
Interest payable period | P6M | ||||||||||
Net proceeds from debt | $ 489.7 | ||||||||||
Debt issuance costs | $ 10.3 | ||||||||||
Principal amount repaid | $ 0 | 17 | 22.1 | ||||||||
Gain (loss) on extinguishment of debt, net | 1.4 | $ 1.2 | |||||||||
Interest rate | 6.25% | ||||||||||
Effective interest rate | 6.58% | ||||||||||
Term Loan | |||||||||||
CHAPTER 11 BANKRUPTCY PROCEEDINGS | |||||||||||
Debt instruments, Face amount | $ 550 | ||||||||||
Margin rate | 4.75% | ||||||||||
Discount on debt instruments issued | $ 2.7 | ||||||||||
Aggregate consideration | 547.3 | ||||||||||
Net proceeds from debt | 540 | ||||||||||
Debt issuance costs | $ 7.3 | ||||||||||
Principal amount repaid | 22.6 | 31 | |||||||||
Gain (loss) on extinguishment of debt, net | $ 2 | $ 0.2 | |||||||||
LIBOR floor rate | 1.00% |
LEASES (Details)
LEASES (Details) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor |
Remaining lease terms | 6 years | 6 years | |||
Residual owed if value of leased assets is zero | $ 5.6 | $ 5.6 | |||
Variable Lease, Cost | 0 | $ 0 | |||
Operating Leases, Rent Expense | $ 49.9 | ||||
Components of our lease costs | |||||
Operating lease cost | 0.3 | $ 12.7 | 21.1 | ||
Short-term lease cost | 0.4 | 4.7 | 5.8 | ||
Total lease cost | 0.7 | 17.4 | 26.9 | ||
Cash paid for amounts included in the measurement of our lease liabilities | 0.3 | 12.9 | 21.3 | ||
Right-of-use assets obtained in exchange for lease liabilities | 0.1 | $ 0.6 | 11 | ||
Operating lease right-of-use assets | $ 4.5 | $ 4.5 | $ 26.3 | ||
Weighted average remaining lease term (years) | 2 years 10 months 24 days | 2 years 10 months 24 days | 2 years 10 months 24 days | 2 years 3 months 18 days | |
Weighted average discount rate | 4.90% | 4.90% | 4.90% | 5.00% | |
Accounting Standards Update 2016-02 | |||||
Components of our lease costs | |||||
Operating lease right-of-use assets | $ 37.8 |
LEASES - Maturity of operating
LEASES - Maturity of operating lease liabilities (Details) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
LEASES | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor |
Maturity of our operating leases | |||||
2021 | $ 3.2 | $ 3.2 | |||
2022 | 1.3 | 1.3 | |||
2023 | 1.2 | 1.2 | |||
2024 | 1.1 | 1.1 | |||
Total lease payments | 6.8 | 6.8 | |||
Less imputed interest | (0.5) | (0.5) | |||
Total lease liabilities | $ 6.3 | $ 6.3 |
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT) - Common and Prefered Stock (Details) - $ / shares | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Subsidiary, Sale of Stock | |||
Common stock, authorized (in shares) | 320,000,000 | ||
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
FTS International | |||
Subsidiary, Sale of Stock | |||
Preferred stock, authorized (in shares) | 5,000,000 | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | ||
Class A common stock | |||
Subsidiary, Sale of Stock | |||
Issuance of common stock (in shares) | 13,700,000 | ||
Common stock, authorized (in shares) | 49,000,000 | 49,000,000 | |
Class A common stock | FTS International | |||
Subsidiary, Sale of Stock | |||
Common stock, authorized (in shares) | 49,000,000 | ||
Class B common stock | |||
Subsidiary, Sale of Stock | |||
Issuance of common stock (in shares) | 300,000 | ||
Common stock, authorized (in shares) | 1,000,000 | 1,000,000 | |
Class B common stock | FTS International | |||
Subsidiary, Sale of Stock | |||
Common stock, authorized (in shares) | 1,000,000 |
STOCKHOLDERS' EQUITY (DEFICIT_2
STOCKHOLDERS' EQUITY (DEFICIT) - Share repurchase program (Details) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | ||
May 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019USD ($)$ / sharesshares | May 31, 2019USD ($) | |
STOCKHOLDERS' EQUITY (DEFICIT) | ||||
Stock split ratio | 0.05 | 69.258777 | ||
Stock Repurchase Program, Authorized Amount | $ 100 | |||
Stock Repurchase Program, Shares Repurchased | shares | 3 | |||
Stock Repurchase Program, Share Price | $ / shares | $ 3.34 | |||
Stock Repurchase Program, Repurchase Amount | $ 9.9 |
STOCKHOLDERS' EQUITY (DEFICIT_3
STOCKHOLDERS' EQUITY (DEFICIT) - IPO (Details) $ / shares in Units, shares in Millions, $ in Millions | Nov. 19, 2020shares | Feb. 02, 2018USD ($)$ / sharesshares | May 31, 2020 | Dec. 31, 2020$ / sharesshares | Dec. 31, 2018USD ($) | Dec. 31, 2019$ / shares |
Subsidiary, Sale of Stock | ||||||
Shares sold by existing shareholder | 4.3 | |||||
Share price | $ / shares | $ 3.34 | |||||
Net proceeds from issuance of common stock | $ | $ 303 | |||||
Stock split ratio | 0.05 | 69.258777 | ||||
IPO | ||||||
Subsidiary, Sale of Stock | ||||||
Total number of shares sold | 22.4 | |||||
Issuance of common stock (in shares) | 18.1 | |||||
Share price | $ / shares | $ 18 | $ 18 | ||||
Net proceeds from issuance of common stock | $ | $ 303 | |||||
Convertible preferred stock conversion ratio | 155.944841 | |||||
Common stock holding percentage prior to IPO | 7.00% | |||||
Recapitalization of convertible preferred stock to common stock (in shares) | 39.4 | |||||
Class A common stock | ||||||
Subsidiary, Sale of Stock | ||||||
Issuance of common stock (in shares) | 13.7 | |||||
Class B common stock | ||||||
Subsidiary, Sale of Stock | ||||||
Issuance of common stock (in shares) | 0.3 |
STOCKHOLDERS' EQUITY (DEFICIT_4
STOCKHOLDERS' EQUITY (DEFICIT) - Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 02, 2018 | Sep. 30, 2012 | Sep. 30, 2012 | Dec. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2017 |
Aggregate consideration on sale of shares | |||||||
Internal rate of return on investment | 25.00% | ||||||
Estimated accreted amount | $ 1,132.7 | ||||||
Qualified IPO for Preferred stock | |||||||
Aggregate proceeds | $ 303 | ||||||
Additional amount on redemption of preferred stock equal to outstanding equity value divided by number of preferred stock (as a percentage) | 20.00% | ||||||
Series A convertible preferred stock | |||||||
Preferred stock, issued (in shares) | 350,000 | 350,000 | |||||
Par value (per share) | $ 0.01 | $ 0.01 | |||||
Aggregate consideration on sale of shares | $ 350 | $ 350 | |||||
Net proceeds | 349.8 | ||||||
Stock issuance costs | $ 0.2 | ||||||
Number of common stock equivalents attributable to convertible preferred stock | 2,573 | 2,573 | |||||
IPO | |||||||
Qualified IPO for Preferred stock | |||||||
Aggregate proceeds | $ 303 | ||||||
IPO | Minimum | Series A convertible preferred stock | |||||||
Qualified IPO for Preferred stock | |||||||
Aggregate proceeds | $ 250 | ||||||
Split-adjusted price (per share) | $ 1.50 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2016 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | ||
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | $ (0.1) | $ 1.2 | |||||
2018 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Shares authorized for grant | 2,800 | ||||||
Additional shares authorized for grant | 3,600 | ||||||
2018 Plan | Employee restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Stock-based compensation expense | $ 10.9 | 10.9 | $ 15.4 | ||||
Weighted-average grant-date fair value | $ 51.22 | ||||||
Unrecognized compensation cost | $ 0 | $ 0 | |||||
2018 Plan | Minimum | Employee restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting period | 3 years | ||||||
2018 Plan | Maximum | Employee restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting period | 4 years | ||||||
2020 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Shares authorized for grant | 2,160 | 2,160 | |||||
Shares available for grants | 1,080 | 1,080 | |||||
2020 Plan | Restricted Stock Awards | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting period | 4 years | ||||||
Weighted average period | 3 years 10 months 24 days | ||||||
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | $ 0.1 | ||||||
Total fair value of restricted stock vested | 0 | ||||||
2020 Plan | Employee restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Stock-based compensation expense | $ 0.2 | ||||||
Weighted-average grant-date fair value | $ 14.11 | ||||||
Unrecognized compensation cost | $ 7.4 | $ 7.4 | |||||
Weighted average period | 3 years 10 months 24 days | ||||||
2020 Plan | Performance Based Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting percentage | 50.00% | ||||||
Stock-based compensation expense | $ 0.1 | ||||||
Weighted-average grant-date fair value | $ 10.91 | ||||||
Unrecognized compensation cost | $ 2.9 | $ 2.9 | |||||
Share Based Compensation By Share Based Payment Award, Vesting Conditions, Market Cap Hurdle For First Half Of The Award | $ 350 | ||||||
Share Based Compensation By Share Based Payment Award, Vesting Conditions, Market Cap Hurdle For Remaining Fifty Percent Of Award | $ 500 | ||||||
2020 Plan | Non-qualified stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Vesting period | 4 years | ||||||
Share-based compensation arrangement by share-based payment award, expiration period | 10 years | ||||||
Stock-based compensation expense | $ 0.1 | ||||||
Weighted-average grant-date fair value | $ 7.85 | ||||||
Unrecognized compensation cost | $ 2 | $ 2 | |||||
Weighted average period | 3 years 10 months 24 days | ||||||
Total fair value of restricted stock vested | $ 0 | ||||||
2014 LTIP | Employee restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Shares authorized for grant | 55,000 | ||||||
2014 LTIP | Stock Settled RSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Stock-based compensation expense | $ 2 | ||||||
2014 LTIP | Cash Settled RSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||||
Stock-based compensation expense | $ 1.7 |
STOCK-BASED COMPENSATION - Rest
STOCK-BASED COMPENSATION - Restricted Stock Unit (Details) - $ / shares shares in Thousands | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Employee restricted stock units | 2018 Plan | |||
Number of Units | |||
Beginning Balance | 179 | ||
Vested | (174) | ||
Forfeited | (5) | ||
Ending Balance | 179 | ||
Weighted-Average Grant Date Fair Value | |||
Beginning Balance | $ 209.23 | ||
Granted | $ 51.22 | ||
Vested | 209.11 | ||
Forfeited | $ 213.74 | ||
Ending Balance | $ 209.23 | ||
Employee restricted stock units | 2020 Plan | |||
Number of Units | |||
Granted | 540 | ||
Ending Balance | 540 | 540 | |
Weighted-Average Grant Date Fair Value | |||
Granted | $ 14.11 | ||
Ending Balance | $ 14.11 | $ 14.11 | |
Performance Based Restricted Stock Units | 2020 Plan | |||
Number of Units | |||
Granted | 270 | ||
Ending Balance | 270 | 270 | |
Weighted-Average Grant Date Fair Value | |||
Granted | $ 10.91 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology | |||
Expected dividend yield | 0.00% | ||
Expected equity volatility, including peers | 59.04% | ||
Expected term (years) | 7 years | ||
Risk-free interest rate | 0.62% | ||
Non-qualified stock options | 2020 Plan | |||
Number of Units | |||
Granted | 270 | ||
Ending Balance | 270 | 270 | |
Weighted-Average Grant Date Fair Value | |||
Granted | $ 7.85 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology | |||
Expected dividend yield | 0.00% | ||
Expected equity volatility, including peers | 60.31% | ||
Expected term (years) | 10 years | ||
Risk-free interest rate | 0.53% |
STOCK-BASED COMPENSATION - Addi
STOCK-BASED COMPENSATION - Additional Information (Details) - USD ($) shares in Thousands, $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2016 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Income tax benefit for all share based compensation expense | $ (0.1) | $ 1.2 | |||
2018 Plan | Employee restricted stock units | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Number of options outstanding | 179 | ||||
Stock-based compensation expense | $ 10.9 | 10.9 | $ 15.4 | ||
Unrecognized compensation cost | $ 0 | 0 | |||
Fair value of vested awards | $ 36.3 | $ 15.8 | |||
2020 Plan | Restricted Stock Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Non vested number of shares | 540 | 540 | |||
Fair value of vested awards | $ 7.6 | ||||
Vesting period | 4 years | ||||
Income tax benefit for all share based compensation expense | $ 0.1 | ||||
2020 Plan | Employee restricted stock units | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Number of options outstanding | 540 | 540 | |||
Stock-based compensation expense | $ 0.2 | ||||
Unrecognized compensation cost | 7.4 | $ 7.4 | |||
Fair value of vested awards | $ 0 | ||||
2020 Plan | Performance Based Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Non vested number of shares | 270 | 270 | |||
Number of options outstanding | 270 | 270 | |||
Stock-based compensation expense | $ 0.1 | ||||
Unrecognized compensation cost | 2.9 | $ 2.9 | |||
Fair value of vested awards | $ 3 | ||||
2020 Plan | Non-qualified stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Non vested number of shares | 270 | 270 | |||
Number of options outstanding | 270 | 270 | |||
Stock-based compensation expense | $ 0.1 | ||||
Unrecognized compensation cost | 2 | $ 2 | |||
Fair value of vested awards | $ 2.1 | ||||
Vesting period | 4 years |
RETIREMENT PLAN (Details)
RETIREMENT PLAN (Details) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Contribution Plan | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor |
Matching contribution by employer | $ 0 | $ 0 | $ 2.5 | $ 4.1 | |
Maximum | |||||
Defined Contribution Plan | |||||
Matching contribution as a percentage | 100.00% | ||||
Minimum | |||||
Defined Contribution Plan | |||||
Matching contribution as a percentage | 0.00% |
IMPAIRMENTS AND OTHER CHARGES -
IMPAIRMENTS AND OTHER CHARGES - Summary of Impairments and Other Charges (Details) $ in Millions | May 01, 2019USD ($) | Dec. 31, 2020USD ($) | May 31, 2019USD ($) | Apr. 30, 2019USD ($) | Nov. 19, 2020USD ($) | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($)item | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Nov. 19, 2020USD ($) | Dec. 31, 2020 | Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($) |
Impairments and other charges | ||||||||||||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | |||||||||||
Supply commitment charges | $ 9.1 | $ 58.5 | $ 19.2 | |||||||||||||
Impairment of assets | 9.7 | |||||||||||||||
Inventory write-down | 5.1 | 6.4 | ||||||||||||||
Transaction costs | 18.5 | |||||||||||||||
Employee severance costs | 1 | |||||||||||||||
Loss on contract termination | $ 0.3 | 0.4 | ||||||||||||||
Total impairments and other charges | $ 0.3 | $ 0.1 | $ 19.4 | $ 10.3 | $ 4.3 | $ 2.1 | $ 6.8 | $ 3.9 | $ 61.8 | 34.1 | 74.6 | 19.2 | ||||
Legal and professional fees | 7 | |||||||||||||||
Payment to certain holders of term loan and secured notes | 11.5 | |||||||||||||||
Reduction of commitments | $ 162 | |||||||||||||||
Commitment amount | $ 21 | $ 47.9 | ||||||||||||||
Annual commitment amount accrued | 11 | 11 | ||||||||||||||
Estimated loss from commitments under contract | 55 | |||||||||||||||
Total commitment amount accrued | $ 55 | 66 | $ 55 | |||||||||||||
Payments made for purchase commitments | 11 | |||||||||||||||
Number of fleets | item | 34 | 28 | ||||||||||||||
Impairment of assets | $ 4.2 | |||||||||||||||
Proceeds from disposal of assets | $ 0.2 | $ 3.3 | $ 1.9 | |||||||||||||
Other Impairments | $ 2.7 | |||||||||||||||
Discontinued Wireline Operations | ||||||||||||||||
Impairments and other charges | ||||||||||||||||
Inventory write-down | 1.4 | |||||||||||||||
Impairment of assets | $ 2.8 | |||||||||||||||
Proceeds from disposal of assets | $ 3.7 |
INCOME TAXES - Components of in
INCOME TAXES - Components of income tax expense (benefit) (Details) - USD ($) $ in Millions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | |||||
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Components of income tax expense (benefit): | ||||||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | |||||
Current: | ||||||||||
State | $ 0.2 | $ 0.5 | $ 2 | |||||||
Foreign | 0.9 | |||||||||
Total current | 0.2 | 1.4 | 2 | |||||||
Income tax expense (benefit) | $ 0 | $ 0.2 | $ 0.1 | $ 1 | $ 0.1 | $ 0.2 | $ 0.2 | $ 1.4 | $ 2 |
INCOME TAXES - Income tax recon
INCOME TAXES - Income tax reconciliation (Details) - USD ($) $ in Millions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | 36 Months Ended | ||||||||
Dec. 31, 2020 | Nov. 19, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | |
Income tax expense (benefit) reconciliation | ||||||||||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | |||||||||
(Loss) income before income taxes | $ (13.4) | $ 106.9 | $ (68.7) | $ (50.7) | $ (11.7) | $ (12.9) | $ (9.8) | $ 6 | $ (54.8) | $ (24.2) | $ (71.5) | $ 260.4 | $ 151.3 | |
Statutory federal income tax rate (as a percent) | 21.00% | 21.00% | 21.00% | 21.00% | ||||||||||
Federal income tax expense (benefit) at statutory rate | $ (2.8) | $ (5.1) | $ (15) | $ 54.7 | ||||||||||
State income tax expense (benefit), net of federal effect | (0.2) | (1.6) | (0.1) | 5.5 | ||||||||||
Effect of changes in income apportionment amongst states | (3.6) | 12 | 6.1 | |||||||||||
Stock-based compensation | 7.4 | 2.1 | 0.3 | |||||||||||
Reorganization adjustments | 0.3 | 577.1 | ||||||||||||
Other items, net | 0.1 | 1 | 1.7 | (0.1) | ||||||||||
Change in valuation allowance | 2.6 | (575) | 0.7 | (64.5) | ||||||||||
Income tax expense (benefit) | $ 0 | $ 0.2 | $ 0.1 | $ 1 | $ 0.1 | $ 0.2 | $ 0.2 | $ 1.4 | $ 2 | |||||
Effective tax rate (as a percent) | 0.00% | (0.80%) | (2.00%) | 0.80% |
INCOME TAXES - Deferred tax ass
INCOME TAXES - Deferred tax assets and deferred tax liabilities (Details) - USD ($) $ in Millions | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred tax assets and deferred tax liabilities | |||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor |
Deferred tax assets: | |||||
Goodwill and intangible assets | $ 19.5 | $ 19.5 | $ 257.5 | ||
Federal net operating loss carryforwards | 65.6 | 65.6 | 359.3 | ||
State net operating loss carryforwards, net of federal benefit | 2.6 | 2.6 | 43.9 | ||
Interest carryforward | 9.6 | 9.6 | 0.1 | ||
Accrued liabilities | 0.8 | 0.8 | 13.7 | ||
Operating lease liability | 1.4 | 1.4 | 6.2 | ||
Stock-based compensation | 0.1 | 0.1 | 2.2 | ||
Other | 0.8 | 0.8 | 2.2 | ||
Gross deferred tax assets | 100.4 | 100.4 | 685.1 | ||
Valuation allowance | (99.3) | (99.3) | (671.7) | ||
Total deferred tax assets | 1.1 | 1.1 | 13.4 | ||
Deferred tax liabilities: | |||||
Property, plant, and equipment | 0.1 | 0.1 | 7.6 | ||
Operating lease right-of use assets | 1 | 1 | 5.8 | ||
Total deferred tax liabilities | 1.1 | 1.1 | 13.4 | ||
Net deferred tax asset | $ 0 | $ 0 | $ 0 |
INCOME TAXES - Operating loss c
INCOME TAXES - Operating loss carryforwards (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Operating loss carryforwards | |
Federal Income Tax, Tax Amortization | $ 86 |
Federal | |
Operating loss carryforwards | |
Net operating loss carryforwards | 312.5 |
Operating loss carryforwards subject to expiration | 40.1 |
Operating Loss Carryforwards | 312.5 |
State | |
Operating loss carryforwards | |
Net operating loss carryforwards | 54 |
Operating loss carryforwards subject to expiration | 16.4 |
Operating Loss Carryforwards | $ 54 |
INCOME TAXES - (Details)
INCOME TAXES - (Details) - USD ($) $ in Millions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | 36 Months Ended | |||||||
Dec. 31, 2020 | Nov. 19, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | |
INCOME TAXES | |||||||||||||
Net deferred tax assets | $ 0 | $ 0 | $ 0 | $ 0 | |||||||||
Cumulative (loss) income before income taxes | (13.4) | $ 106.9 | $ (68.7) | $ (50.7) | $ (11.7) | (12.9) | $ (9.8) | $ 6 | $ (54.8) | $ (24.2) | (71.5) | $ 260.4 | 151.3 |
Deductible temporary differences | 100.4 | 685.1 | 685.1 | 100.4 | |||||||||
Unrecognized income tax benefits | |||||||||||||
Accrued interest expense with unrecognized tax benefits | $ 0 | $ 0 | $ 0 | $ 0 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | Feb. 22, 2019 | Nov. 12, 2018 | Jul. 19, 2018 | Jun. 24, 2015 | Dec. 31, 2020 |
Purchase obligations due | |||||
2021 | $ 0.3 | ||||
2022 | 0.3 | ||||
2023 | 0.3 | ||||
2024 | 0.1 | ||||
Patterson Case | |||||
Litigation | |||||
Damages sought | $ 1 | ||||
Damages awarded value | $ 33 | $ 100 | |||
Glock Case | |||||
Litigation | |||||
Damages sought | $ 1 | ||||
Other purchase obligations | |||||
Purchase obligations due | |||||
2021 | 0.3 | ||||
2022 | 0.3 | ||||
2023 | 0.3 | ||||
2024 | $ 0.1 |
EARNINGS (LOSS) PER SHARE - (De
EARNINGS (LOSS) PER SHARE - (Details) $ / shares in Units, shares in Thousands, $ in Millions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2020USD ($)$ / sharesshares | May 31, 2020 | Feb. 28, 2018 | Nov. 19, 2020USD ($)$ / shares | Sep. 30, 2020USD ($)$ / shares | Jun. 30, 2020USD ($)$ / shares | Mar. 31, 2020USD ($)$ / shares | Dec. 31, 2019USD ($)$ / shares | Sep. 30, 2019USD ($)$ / shares | Jun. 30, 2019USD ($)$ / shares | Mar. 31, 2019USD ($)$ / shares | Nov. 19, 2020USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Feb. 02, 2018$ / shares | Dec. 31, 2017USD ($) | |
Earnings per share basic and diluted | |||||||||||||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | ||||||||||||
Numerator: | |||||||||||||||||
Net (loss) income | $ (13.4) | $ 106.7 | $ (68.7) | $ (50.7) | $ (11.7) | $ (13) | $ (10.8) | $ 5.9 | $ (55) | $ (24.4) | $ (72.9) | $ 258.4 | |||||
Net reversal of convertible preferred stock accretion due to recapitalization of convertible preferred stock to common stock | 423.2 | ||||||||||||||||
Net (loss) income attributable to common stockholders used for diluted EPS computation | $ (13.4) | $ (24.4) | $ (72.9) | $ 681.6 | |||||||||||||
Denominator: | |||||||||||||||||
Weighted average shares used for basic EPS computation | shares | 13,990 | 5,377 | 5,440 | 5,208 | |||||||||||||
Number of shares used for diluted EPS computation (in thousands) | shares | 13,990 | 5,377 | 5,440 | 5,208 | |||||||||||||
Basic and diluted loss per share | $ / shares | $ (0.96) | $ 19.83 | $ (12.77) | $ (9.43) | $ (2.18) | $ (2.42) | $ (1.99) | $ 1.08 | $ (10.03) | $ (4.54) | $ (13.40) | $ 130.88 | |||||
Reverse stock split ratio | 20 | 69.258777 | |||||||||||||||
Estimated Accreted Amount on Preferred Stock | $ 1,132.7 | ||||||||||||||||
Recapitalization of convertible preferred stock to common stock | $ 349.8 | ||||||||||||||||
Share Price | $ / shares | $ 3.34 | $ 3.34 | |||||||||||||||
Net reversal | $ 423.2 | ||||||||||||||||
IPO | |||||||||||||||||
Numerator: | |||||||||||||||||
Net reversal of convertible preferred stock accretion due to recapitalization of convertible preferred stock to common stock | $ 423.2 | ||||||||||||||||
Denominator: | |||||||||||||||||
Recapitalization of convertible preferred stock to common stock (in shares) | shares | 39,400 | ||||||||||||||||
Recapitalization of convertible preferred stock to common stock | $ 709.5 | ||||||||||||||||
Share Price | $ / shares | $ 18 | $ 18 | $ 18 | ||||||||||||||
Net reversal | $ 423.2 |
SELECTED QUARTERLY DATA (UNAU_3
SELECTED QUARTERLY DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | 36 Months Ended | ||||||||
Dec. 31, 2020 | Nov. 19, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Nov. 19, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | |
SELECTED QUARTERLY DATA (UNAUDITED) | ||||||||||||||
Financial Designation, Predecessor and Successor [Fixed List] | Successor | Predecessor | Successor | Predecessor | Predecessor | |||||||||
Revenue | ||||||||||||||
Revenue | $ 22.6 | $ 27.2 | $ 32.1 | $ 29.5 | $ 150.8 | $ 142.3 | $ 186 | $ 225.8 | $ 221.6 | $ 239.6 | $ 775.7 | $ 1,450.4 | ||
Revenue from related parties | 0.7 | 0.9 | 0.7 | 0.9 | 92.9 | |||||||||
Total revenue | 22.6 | 27.2 | 32.1 | 29.5 | 151.5 | 142.3 | 186 | 225.8 | 222.5 | 240.3 | 776.6 | 1,543.3 | ||
Operating Costs and Expenses [Abstract] | ||||||||||||||
Costs of revenue | 24.1 | 23 | 30.7 | 28.9 | 114.6 | 101.5 | 145.5 | 164.8 | 162.1 | 197.2 | 573.9 | 1,033.2 | ||
Selling, general and administrative | 4.7 | 5.1 | 11.8 | 13.2 | 17.7 | 22.7 | 21.1 | 21.7 | 23.6 | 47.8 | 89.1 | 87.9 | ||
Depreciation and amortization | 4.8 | 9.1 | 17.8 | 20.2 | 21.4 | 22.1 | 22.7 | 22.8 | 22.4 | 68.5 | 90 | 84.7 | ||
Impairments and other charges | 0.3 | 0.1 | 19.4 | 10.3 | 4.3 | 2.1 | 6.8 | 3.9 | 61.8 | 34.1 | 74.6 | 19.2 | ||
Loss (gain) on disposal of assets, net | 0.2 | (0.1) | (0.4) | (0.1) | (1.2) | 0.3 | 0.1 | (1.4) | (0.1) | |||||
Total operating expenses | 33.9 | 37.3 | 79.7 | 72.8 | 157.9 | 148 | 196 | 212 | 270.2 | 347.7 | 826.2 | 1,224.9 | ||
Operating (loss) income | (11.3) | (10.1) | (47.6) | (43.3) | (6.4) | (5.7) | (10) | 13.8 | (47.7) | (107.4) | (49.6) | 318.4 | ||
Interest expense, net | (7.4) | (7.4) | (7.3) | (7.2) | (7.6) | (7.7) | (8.2) | (22.1) | (30.7) | (49.3) | ||||
Gain (loss) on extinguishment of debt, net | 2 | 0.8 | (0.1) | 0.5 | 2 | 1.2 | (9.8) | |||||||
Equity in net income (loss) of joint venture affiliate | 0.6 | 0.6 | 1.1 | |||||||||||
Gain on sale of equity interest in joint venture affiliate | 7 | 7 | ||||||||||||
Reorganization items, net | (2.1) | 117 | (13.7) | 103.3 | ||||||||||
(Loss) income before income taxes | (13.4) | 106.9 | (68.7) | (50.7) | (11.7) | (12.9) | (9.8) | 6 | (54.8) | (24.2) | (71.5) | 260.4 | $ 151.3 | |
Income tax benefit | 0 | 0.2 | 0.1 | 1 | 0.1 | 0.2 | 0.2 | 1.4 | 2 | |||||
Net (loss) income | (13.4) | $ 106.7 | $ (68.7) | $ (50.7) | $ (11.7) | (13) | (10.8) | 5.9 | (55) | (24.4) | (72.9) | 258.4 | ||
Net (loss) income attributable to common stockholders | $ (13.4) | $ (13) | $ (10.8) | $ 5.9 | $ (55) | $ (24.4) | $ (72.9) | $ 681.6 | ||||||
Basic and diluted loss per share | $ (0.96) | $ 19.83 | $ (12.77) | $ (9.43) | $ (2.18) | $ (2.42) | $ (1.99) | $ 1.08 | $ (10.03) | $ (4.54) | $ (13.40) | $ 130.88 | ||
Shares used in computing basic and diluted (loss) earnings per share (in thousands) | 13,990 | 5,382 | 5,381 | 5,379 | 5,367 | 5,365,000 | 5,430,000 | 5,484,000 | 5,483,000 | 5,377 | 5,440 | 5,208 | ||
Supply commitment charge | $ 55 |