Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 01, 2019 | |
Document and Entity Information | ||
Entity Registrant Name | DASEKE, INC. | |
Entity Central Index Key | 0001642453 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Common shares outstanding | 64,583,266 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 63.7 | $ 46 |
Accounts receivable, net of allowance of $0.9 at June 30, 2019 and $1.2 at December 31, 2018 | 231 | 209.2 |
Drivers’ advances and other receivables | 7.3 | 5.5 |
Current portion of net investment in sales-type leases | 16.2 | |
Parts supplies | 5 | 4.9 |
Prepaid and other current assets | 19.7 | 26.3 |
Total current assets | 326.7 | 308.1 |
Property and equipment, net | 579.9 | 572.7 |
Intangible assets, net | 200.9 | 208.8 |
Goodwill | 258.7 | 258.4 |
Right-of-use assets | 106.8 | |
Other long-term assets | 30 | 42.9 |
Total assets | 1,503 | 1,390.9 |
Current liabilities: | ||
Accounts payable | 23.8 | 22.2 |
Accrued expenses and other liabilities | 50.6 | 46.5 |
Accrued payroll, benefits and related taxes | 27.2 | 21.7 |
Accrued insurance and claims | 18.5 | 18.1 |
Current portion of long-term debt | 62.4 | 63.5 |
Other current liabilities | 50 | 21.9 |
Total current liabilities | 232.5 | 193.9 |
Long-term debt, net of current portion | 636.5 | 622.7 |
Deferred tax liabilities | 123.9 | 126.8 |
Other long-term liabilities | 79.1 | 0.5 |
Total liabilities | 1,072 | 943.9 |
Commitments and contingencies (Note 13) | ||
Stockholders’ equity: | ||
Additional paid-in-capital | 435.6 | 433.9 |
Accumulated deficit | (69.2) | (51) |
Accumulated other comprehensive loss | (0.4) | (0.9) |
Total stockholders’ equity | 431 | 447 |
Total liabilities and stockholders’ equity | 1,503 | 1,390.9 |
Series A convertible preferred stock | ||
Stockholders’ equity: | ||
Series A convertible preferred stock, $0.0001 par value; 10,000,000 shares authorized; 650,000 shares issued with liquidation preference of $65.0 at June 30, 2019 and December 31, 2018 | $ 65 | $ 65 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Net of allowance | $ 0.9 | $ 1.2 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, issued | 64,579,993 | 64,455,174 |
Common stock, outstanding | 64,579,993 | 64,455,174 |
Series A convertible preferred stock | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized | 10,000,000 | 10,000,000 |
Preferred stock, issued | 650,000 | 650,000 |
Preferred liquidation preference | $ 65 | $ 65 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues: | ||||
Total revenue | $ 450.6 | $ 376.9 | $ 883.6 | $ 704.5 |
Operating expenses: | ||||
Salaries, wages and employee benefits | 124.3 | 90.7 | 243.4 | 173 |
Operations and maintenance | 53.1 | 40.4 | 107.9 | 75 |
Communications | 1.2 | 0.8 | 2.2 | 1.5 |
Administrative expenses | 17.2 | 13.1 | 33.3 | 25.2 |
Sales and marketing | 1.3 | 0.8 | 2.5 | 1.4 |
Insurance and claims | 12.2 | 10.4 | 24.7 | 19.6 |
Acquisition-related transaction expenses | 1.4 | 1.8 | ||
Depreciation and amortization | 39.7 | 31.7 | 81.2 | 56.9 |
Gain on disposition of property and equipment | (0.7) | (0.5) | (1.1) | (0.6) |
Impairment | 2.8 | 2.8 | ||
Total operating expenses | 445.9 | 368.4 | 878.2 | 688.2 |
Income from operations | 4.7 | 8.5 | 5.4 | 16.3 |
Other expense (income): | ||||
Interest income | (0.2) | (0.6) | (0.4) | (1) |
Interest expense | 12.7 | 11.1 | 25.4 | 21.4 |
Other | (0.7) | (1) | (1.3) | (1.9) |
Total other expense | 11.8 | 9.5 | 23.7 | 18.5 |
Loss before benefit for income taxes | (7.1) | (1) | (18.3) | (2.2) |
Benefit for income taxes | (0.7) | (14.5) | (2.6) | (14.9) |
Net income (loss) | (6.4) | 13.5 | (15.7) | 12.7 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments, net of tax of $0.1, $0.1, $0.3 and $0.3, respectively | 0.4 | (0.6) | 0.5 | (0.9) |
Comprehensive income (loss) | (6) | 12.9 | (15.2) | 11.8 |
Net income (loss) | (6.4) | 13.5 | (15.7) | 12.7 |
Net income (loss) attributable to common stockholders | $ (7.7) | $ 12.2 | $ (18.2) | $ 10.2 |
Net income (loss) per common share: | ||||
Basic and Diluted (in dollars per share) | $ (0.12) | $ 0.20 | $ (0.28) | $ 0.17 |
Weighted-average common shares outstanding: | ||||
Basic and Diluted (in shares) | 64,523,163 | 60,558,956 | 64,496,550 | 57,935,688 |
Series A | ||||
Other comprehensive income (loss): | ||||
Less dividends to Series A convertible preferred stockholders | $ (1.3) | $ (1.3) | $ (2.5) | $ (2.5) |
Weighted-average common shares outstanding: | ||||
Dividends declared per Series A convertible preferred share | $ 1.91 | $ 1.91 | $ 3.81 | $ 3.81 |
Company freight | ||||
Revenues: | ||||
Total revenue | $ 206.9 | $ 160 | $ 413.1 | $ 304.6 |
Owner operator freight | ||||
Revenues: | ||||
Total revenue | 121.7 | 112.6 | 232.7 | 208.1 |
Brokerage | ||||
Revenues: | ||||
Total revenue | 72.8 | 60.1 | 144.2 | 106.2 |
Logistics | ||||
Revenues: | ||||
Total revenue | 13.1 | 8.9 | 25.5 | 19.6 |
Fuel surcharge | ||||
Revenues: | ||||
Total revenue | 36.1 | 35.3 | 68.1 | 66 |
Operating expenses: | ||||
Fuel | 36.2 | 31.3 | 71.2 | 64.7 |
Service | ||||
Operating expenses: | ||||
Cost of revenue | 156.4 | 141.6 | 303 | 259.3 |
Taxes and licenses | $ 5 | $ 3.9 | $ 9.9 | $ 7.6 |
CONSOLIDATED STATEMENTS OF OP_2
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) | ||||
Foreign currency translation adjustments tax expense (benefit) | $ 0.1 | $ 0.1 | $ 0.3 | $ 0.3 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY - USD ($) $ in Millions | Series A convertible preferred stockSeries A convertible preferred stock | Series A convertible preferred stockRetained Earnings (Accumulated Deficit). | Series A convertible preferred stock | Common Stock Member | Additional Paid-In Capital Member | Retained Earnings (Accumulated Deficit). | Accumulated Other Comprehensive (Loss) | Total |
Balance (in Value) at Dec. 31, 2017 | $ 65 | $ 277.9 | $ 7.3 | $ 1 | $ 351.2 | |||
Balance (in Shares) at Dec. 31, 2017 | 650,000 | 48,712,288 | ||||||
Exercise of stock options (in Value) | 0.1 | 0.1 | ||||||
Exercise of stock options (in shares) | 5,000 | |||||||
Convertible Preferred Stock dividend | $ (1.2) | $ (1.2) | ||||||
Stock based compensation expense | 0.9 | 0.9 | ||||||
Issuance of common stock | 84.5 | 84.5 | ||||||
Issuance of common stock (in shares) | 8,545,000 | |||||||
Foreign currency translation adjustments | (0.3) | (0.3) | ||||||
Net loss | (0.8) | (0.8) | ||||||
Balance (in Value) at Mar. 31, 2018 | $ 65 | 363.4 | 5.3 | 0.7 | 434.4 | |||
Balance (in Shares) at Mar. 31, 2018 | 650,000 | 57,262,288 | ||||||
Balance (in Value) at Dec. 31, 2017 | $ 65 | 277.9 | 7.3 | 1 | 351.2 | |||
Balance (in Shares) at Dec. 31, 2017 | 650,000 | 48,712,288 | ||||||
Issuance of earnout shares | 48.2 | |||||||
Foreign currency translation adjustments | (0.9) | |||||||
Net loss | 12.7 | |||||||
Balance (in Value) at Jun. 30, 2018 | $ 65 | 427.9 | (30.7) | 0.1 | 462.3 | |||
Balance (in Shares) at Jun. 30, 2018 | 650,000 | 63,875,267 | ||||||
Balance (in Value) at Mar. 31, 2018 | $ 65 | 363.4 | 5.3 | 0.7 | 434.4 | |||
Balance (in Shares) at Mar. 31, 2018 | 650,000 | 57,262,288 | ||||||
Convertible Preferred Stock dividend | (1.3) | (1.3) | ||||||
Stock based compensation expense | 0.9 | 0.9 | ||||||
Issuance of common stock | 15.4 | 15.4 | ||||||
Issuance of common stock (in shares) | 1,612,979 | |||||||
Issuance of earnout shares | 48.2 | (48.2) | ||||||
Issuance of earnout shares (in shares) | 5,000,000 | |||||||
Foreign currency translation adjustments | (0.6) | (0.6) | ||||||
Net loss | 13.5 | 13.5 | ||||||
Balance (in Value) at Jun. 30, 2018 | $ 65 | 427.9 | (30.7) | 0.1 | 462.3 | |||
Balance (in Shares) at Jun. 30, 2018 | 650,000 | 63,875,267 | ||||||
Balance (in Value) at Dec. 31, 2018 | $ 65 | 433.9 | (51) | (0.9) | 447 | |||
Balance (in Shares) at Dec. 31, 2018 | 650,000 | 64,455,174 | ||||||
Vesting of restricted stock units (in Shares) | 14,498 | |||||||
Convertible Preferred Stock dividend | (1.2) | (1.2) | ||||||
Stock based compensation expense | 1 | 1 | ||||||
Foreign currency translation adjustments | 0.1 | 0.1 | ||||||
Net loss | (9.3) | (9.3) | ||||||
Balance (in Value) at Mar. 31, 2019 | $ 65 | 434.9 | (61.5) | (0.8) | 437.6 | |||
Balance (in Shares) at Mar. 31, 2019 | 650,000 | 64,469,672 | ||||||
Balance (in Value) at Dec. 31, 2018 | $ 65 | 433.9 | (51) | (0.9) | 447 | |||
Balance (in Shares) at Dec. 31, 2018 | 650,000 | 64,455,174 | ||||||
Foreign currency translation adjustments | 0.5 | |||||||
Net loss | (15.7) | |||||||
Balance (in Value) at Jun. 30, 2019 | $ 65 | 435.6 | (69.2) | (0.4) | 431 | |||
Balance (in Shares) at Jun. 30, 2019 | 650,000 | 64,579,993 | ||||||
Balance (in Value) at Mar. 31, 2019 | $ 65 | 434.9 | (61.5) | (0.8) | 437.6 | |||
Balance (in Shares) at Mar. 31, 2019 | 650,000 | 64,469,672 | ||||||
Vesting of restricted stock units (in Value) | (0.2) | (0.2) | ||||||
Vesting of restricted stock units (in Shares) | 110,321 | |||||||
Convertible Preferred Stock dividend | $ (1.3) | $ (1.3) | ||||||
Stock based compensation expense | 0.9 | 0.9 | ||||||
Foreign currency translation adjustments | 0.4 | 0.4 | ||||||
Net loss | (6.4) | (6.4) | ||||||
Balance (in Value) at Jun. 30, 2019 | $ 65 | $ 435.6 | $ (69.2) | $ (0.4) | $ 431 | |||
Balance (in Shares) at Jun. 30, 2019 | 650,000 | 64,579,993 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Millions | 6 Months Ended | |
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | |
Cash flows from operating activities | ||
Net income (loss) | $ (15.7) | $ 12.7 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation | 73 | 48.8 |
Amortization of intangible assets | 8.2 | 8.1 |
Amortization of deferred financing fees | 1.5 | 1.4 |
Non-cash operating lease expense | 13.3 | |
Stock-based compensation expense | 1.9 | 1.8 |
Deferred taxes | (2.6) | (16.2) |
Bad debt expense | 0.5 | 0.2 |
Gain on disposition of property and equipment | (1.1) | (0.6) |
Gain on disposition of building | (0.8) | |
Deferred gain recognized on sales-type leases | (1.4) | |
Impairment | 2.8 | |
Changes in operating assets and liabilities | ||
Accounts receivable | (21.9) | (31.5) |
Drivers’ advances and other receivables | (1.7) | (0.1) |
Payments received on sales-type leases | 6.5 | |
Prepaid and other current assets | (0.2) | (6.3) |
Accounts payable | 1.4 | 0.1 |
Accrued expenses and other liabilities | (1.7) | 3.5 |
Net cash provided by operating activities | 54.9 | 29 |
Cash flows from investing activities | ||
Purchases of property and equipment | (12.1) | (31.1) |
Proceeds from sale of property and equipment | 16.5 | 11.7 |
Cash paid for acquisitions, net of cash received | (79.1) | |
Net cash provided by (used in) investing activities | 4.4 | (98.5) |
Cash flows from financing activities: | ||
Advances on line of credit | 639.2 | 468.1 |
Repayments on line of credit | (639.2) | (472.7) |
Principal payments on long-term debt | (38.9) | (25.2) |
Proceeds from Term Loan Facility | 5.9 | |
Deferred financing fees | (0.2) | (0.6) |
Proceeds from issuance of common stock | 84.6 | |
Net cash provided by (used in) financing activities | (41.6) | 57.6 |
Effect of exchange rates on cash and cash equivalents | (0.1) | |
Net increase (decrease) in cash and cash equivalents | 17.7 | (12) |
Cash and cash equivalents – beginning of period | 46 | 90.7 |
Cash and cash equivalents – end of period | 63.7 | 78.7 |
Supplemental disclosure of cash flow information | ||
Cash paid for interest | 23.4 | 20 |
Cash paid for income taxes | 1.3 | 1.3 |
Noncash investing and financing activities | ||
Property and equipment acquired with debt or finance lease obligations | 47.9 | 11.6 |
Accrued capital expenditures | 4.4 | |
Property and equipment sold for notes receivable | 0.3 | 0.2 |
Property and equipment transferred to sales-type lease | 3.9 | |
Sales-type lease returns to property and equipment | 0.4 | |
Sales-type lease assets acquired with debt or capital lease obligations | 9.9 | |
Sales-type lease assets sold for notes receivable | 28.1 | |
Sales-type lease returns to sales-type lease assets | 15.5 | |
Common stock issued in acquisitions | 15.4 | |
Issuance of earnout shares | 48.2 | |
Right-of-use assets acquired | 25.7 | |
Series A | ||
Cash flows from financing activities: | ||
Series A convertible preferred stock dividends | $ (2.5) | $ (2.5) |
NATURE OF OPERATIONS AND SUMMAR
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2019 | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations Daseke, Inc.’s (the Company or Daseke) wholly-owned subsidiary Daseke Companies, Inc., was incorporated in December 2008 and began operations on January 1, 2009. Daseke is engaged in full service open-deck trucking that specializes primarily in flatbed truckload and heavy haul transportation of specialized items throughout the United States, Canada and Mexico. The Company also provides logistical planning and warehousing services to customers. The Company is subject to regulation by the Department of Transportation, the Department of Defense, the Department of Energy, and various state regulatory authorities in the United States. The Company is also subject to regulation by the Ministries of Transportation and Communications and various provincial regulatory authorities in Canada. Basis of Presentation These interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ended December 31, 2019. The consolidated balance sheet as of December 31, 2018 has been derived from the audited consolidated financial statements at that date. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes for the year ended December 31, 2018 as set forth in the Company’s Annual Report on Form 10-K, filed with the SEC on March 8, 2019. Certain items have been reclassified for presentation purposes to conform to the accounting policies of the consolidated entity. These reclassifications had no material impact on income from operations, net loss and comprehensive loss, the balance sheets or statements of cash flows. Principles of Consolidation The consolidated financial statements include the accounts of Daseke, Inc. and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of the consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Deferred Financing Fees In conjunction with obtaining long-term debt, the Company incurred financing costs which are being amortized using the straight-line method, which approximates the effective interest rate method, over the terms of the obligations. As of June 30, 2019 and December 31, 2018, the balance of deferred finance charges was $14.9 million and $16.2 million, respectively, which is included as a reduction of long-term debt, net of current portion in the consolidated balance sheets. Amortization expense was $0.8 million for each of the three months periods ended June 30, 2019 and 2018, and $1.5 million and $1.4 million for the six months ended June 30, 2019 and 2018, respectively. Amortization expense is included in interest expense in the consolidated statements of operations and comprehensive income (loss). Fair Value Measurements The Company follows the accounting guidance for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a framework for measuring fair value and expands disclosures about fair value measurements. The three levels of the fair value framework are as follows: Level 1 - Quoted market prices in active markets for identical assets or liabilities. Level 2 - Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3 - Unobservable inputs reflecting the reporting entity’s own assumptions or external inputs from inactive markets. A financial asset or liability’s classification within the framework is determined based on the lowest level of input that is significant to the fair value measurement. Contingent Consideration The contingent consideration liabilities represent future payment obligations for certain EBITDA thresholds related to the Company’s acquisitions over a defined period of time. See Note 3 for additional details on the future payment obligations connected to the Company’s acquisitions. The fair value of the Company’s contingent consideration liabilities are determined using estimates based on discount rates that reflect the risk involved and the projected EBITDA of the acquired businesses, therefore the liabilities are classified within Level 3 of the fair value framework. The balance of contingent consideration as of June 30, 2019 and December 31, 2018 was $21.5 million and $21.9 million, respectively. The changes in the fair value were the same for the three and six months ended June 30, 2019 and 2018. The table below is a summary of the changes in the fair value of this liability for the six months ended June 30, 2019 and 2018 (in millions): Six Months Ended June 30, 2019 2018 Balance at beginning of period $ 21.9 $ 0.8 Fair value of earn-out liability for acquisition — 20.3 Change in fair value (0.4) (0.7) Balance at end of period $ 21.5 $ 20.4 Stock-Based Compensation Awards of equity instruments issued to employees and directors are accounted for under the fair value method of accounting and recognized in the consolidated statements of operations and comprehensive loss. Compensation cost is measured for all stock-based awards at fair value on the date of grant and recognized using the straight-line method over the service period over which the awards are expected to vest. Fair value of all time-vested options as of the date of grant is estimated using the Black-Scholes option valuation model, which was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. Option valuation models require the input of highly subjective assumptions, including the expected stock price volatility. Since the Company does not have a sufficient history of exercise behavior, expected term is calculated using the assumption that the options will be exercised ratably from the date of vesting to the end of the contractual term for each vesting tranche of awards. The risk-free interest rate is based on the U.S. Treasury yield curve for the period of the expected term of the stock option. Expected volatility is calculated using an index of publicly traded peer companies. Fair values of non-vested stock awards (restricted stock units) are equal to the market value of the common stock on the date of the award with compensation costs amortized over the vesting period of the award. Segment Reporting The Company determines its operating segments based on the information utilized by the chief operating decision maker to allocate resources and assess performance. Based on this information, the Company has determined it had 16 operating segments as of June 30, 2019 and 2018 that are aggregated into two reportable segments: Flatbed Solutions, which delivers its services using primarily flatbed transportation equipment to meet the needs of high-volume, time-sensitive shippers, and Specialized Solutions, which delivers transportation and logistics solutions for super heavy haul, high-value customized and over-dimensional loads, many of which require engineering and customized equipment. Earnings (Loss) Per Share Basic earnings (loss) per common share is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share reflect the potential dilution of earnings per share that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the Company’s earnings (loss). For the three and six months ended June 30, 2019 and 2018, shares of the Company’s 7.625% Series A Convertible Cumulative Preferred Stock (Series A Preferred Stock) and outstanding stock options were not included in the computation of diluted earnings (loss) per share as their effects were anti-dilutive. Additionally, for the three and six months ended June 30, 2019 and 2018, there was no dilutive effect from the Merger Agreement earn-out provision found in the Agreement and Plan of Merger, dated December 22, 2016, in which a wholly-owned subsidiary of Hennessy Capital Acquisition Corp. II (Hennessy) merged with and into Daseke, with Daseke surviving as a direct wholly-owned subsidiary of Hennessy, (the Merger Agreement) or the outstanding warrants to purchase shares of the Company’s common stock (the common stock purchase warrants). See Note 15 for the effects of non-vested restricted stock units on basic and diluted earnings per share under the two-class method. Common Stock Purchase Warrants The Company accounts for the issuance of common stock purchase warrants in connection with equity offerings in accordance with the provisions of the Accounting Standards Codification (ASC) 815, Derivatives and Hedging (Topic 815). The Company classifies as equity any contract that (i) requires physical settlement or net-share settlement or (ii) gives the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contract that (i) requires net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the control of the Company) or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). See Note 10 for additional details on the common stock purchase warrants. The Company assessed the classification of its common stock purchase warrants and determined that such instruments meet the criteria for equity classification at the time of issuance. Foreign Currency Gains and Losses The functional currency for all operations except Canada is the U.S. dollar. The local currency is the functional currency for the Company’s operations in Canada. For these operations, assets and liabilities are translated at the rates of exchange on the consolidated balance sheet date, while income and expense items are translated at average rates of exchange during the period. The resulting gains or losses arising from the translation of accounts from the functional currency into U.S. dollars are included as a separate component of stockholders’ equity in accumulated other comprehensive income until a partial or complete liquidation of the Company’s net investment in the foreign operation. From time to time, the Company’s foreign operations may enter into transactions that are denominated in a currency other than their functional currency. These transactions are initially recorded in the functional currency of the operating company based on the applicable exchange rate in effect on the date of the transaction. Monthly, these transactions are remeasured to an equivalent amount of the functional currency based on the applicable exchange rate in effect on the remeasurement date. Any adjustment required to remeasure a transaction to the equivalent amount of functional currency is recorded in the consolidated statements of operations of the foreign operating company as a component of foreign exchange gain or loss. Assets Held for Sale Through December 31, 2018, assets held for sale were primarily comprised of revenue equipment in the Company’s lease purchase program and recorded as a component of prepaid and other current assets on the consolidated balance sheets. Assets held for sale were not subject to depreciation, and were recorded at the lower of depreciated carrying value or fair market value less selling costs. Assets held for sale as of December 31, 2018, totaled $3.6 million, consisting of $2.7 million for the Flatbed Solutions segment and $0.9 million for the Specialized Solutions. Following the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842), the revenue equipment in the Company’s lease purchase program no longer meets the criteria for assets held for sale. See Note 2 for additional information on the adoption of ASU No. 2016-02. There were no assets held for sale as of June 30, 2019. Revenue and Expense Recognition The Company’s revenue and related costs are recognized when the Company satisfies its performance obligation(s) transferring goods or services to the customer and the customer obtains control of such goods and services. With respect to freight, brokerage, logistics and fuel surcharge revenue, these conditions are met, and the Company recognizes company freight, owner operator freight, brokerage and fuel surcharge revenue, over time, and logistics revenue, as the services are provided. While the Company may enter into master service agreements with its customers, a contract is not established until the customer specifically requests the Company’s services and the Company accepts. The Company evaluates each contract for distinct performance obligations. In the Company’s business, a typical performance obligation is the transportation of a load including any highly interrelated ancillary services. The Company predominantly estimates the standalone selling price of its services based upon observable evidence, market conditions and other relevant inputs. The Company allocates the total transaction price to each distinct performance obligation based upon the relative standalone selling prices. The Company’s customers simultaneously receive and consume the benefits of the Company’s contracts; therefore, revenue is recognized over time. This is a faithful depiction of the satisfaction of the performance obligation, as the customer does not need to re-perform the transportation services the Company has provided to date. Generally, the Company’s customers are billed upon delivery of the freight or monthly and remit payment according to the approved payment terms. Freight Revenue Freight revenue is generated by hauling customer freight using company owned equipment (company freight) and owner-operator equipment (owner-operator freight). Freight revenue is the product of the number of revenue-generating miles driven and the rate per mile received from customers plus accessorial charges, such as loading and unloading freight, cargo protection, fees for detained equipment or fees for route planning and supervision. Brokerage Revenue The Company regularly engages third-party capacity providers to haul loads. The Company is primarily responsible for fulfilling the promise to provide load transportation services, and has discretion in setting prices, along with the risk to fulfill the contract to the customer. Based upon this evaluation, the Company has determined that it is the principal and therefore, records gross revenues and expenses for brokerage services. Logistics Revenue In addition to freight revenue, the Company also recognizes logistics revenue as a separate revenue stream. Logistics revenue is generated from a range of services, including value-added warehousing, loading and unloading, vehicle maintenance and repair, preparation and packaging, fuel management, and other fleet management solutions. The Company recognizes logistics revenue as services are completed. The Company has designated the following preference and practical expedients: · To not disclose remaining performance obligations when the expected performance obligation duration is one year or less. The vast majority of the Company’s services transfer control within a month of the inception of the contract with select specialized loads taking several months to allow for increased planning and permitting. · Recognize the incremental costs of obtaining or fulfilling a contract as an expense when incurred, as the amortization period of a potential asset would be recognized in one year or less. · Exclude taxes collected on behalf of government authorities from the Company’s measurement of transaction prices. Tax amounts are not included within net income or cost of sales. New Accounting Pronouncements In July 2017, the Financial Accounting Standards Board (FASB) issued ASU 2017-11, Earnings per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); and Derivatives and Hedging (Topic 815) . ASU 2017-11 provides guidance on accounting for financial instruments with down round features and clarifies the deferral of certain provisions in Topic 480. ASU 2017-11 will become effective for annual periods beginning after December 15, 2018 and interim periods within those periods. The Company adopted this pronouncement on January 1, 2019, which did not impact the consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Accounting for Credit Losses (Topic 326) . ASU 2016-13 requires the use of an “expected loss” model on certain types of financial instruments. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact of adopting this guidance. |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2019 | |
LEASES | |
LEASES | NOTE 2 – LEASES Change in Accounting Principle In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which amends the FASB Accounting Standards Codification (ASC) and creates Topic 842 (ASC 842), Leases. On January 1, 2019, the Company adopted ASC 842, which is effective for interim and annual reporting periods beginning on or after December 15, 2018. This Topic requires balance sheet recognition of lease assets and lease liabilities for leases classified as operating leases under previous GAAP. Under the standard, disclosures are required to meet the objective of enabling users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company has completed its evaluation of the requirements of ASC 842 and related amendments. As part of the Company’s evaluation, management compiled and analyzed contracts, identified the full lease population, implemented and populated leasing software and implemented new controls associated with adopting and adhering to the standard, and reviewed its accounting practices for revenue equipment that it leased to certain of its owner-operators. The Company adopted this guidance as of January 1, 2019, using the optional transition method and elected the option to not apply ASC 842 to comparative periods, which continue to be presented under the accounting standards in effect for those periods. Lessee The adoption of this standard had a material impact on the Company’s financial position. Adoption of the new standard resulted in the recording of additional net lease assets, right-of-use assets and lease liabilities on the Company’s consolidated balance sheets of approximately $96.9 million and $96.9 million, respectively. The right-of-use assets recorded on the balance sheet include primarily trucking facilities and terminals and revenue equipment leases. The standard did not have a material impact on the Company’s consolidated statements of operations and comprehensive loss, however, there have been additions and modifications to its existing financial disclosures. The Company has designated the following preferences and practical expedients: · To not reassess whether any expired or existing contracts contain a lease; · Carryforward previous conclusions related to prior lease classification under the prior lease accounting standard to lease classification for existing leases under ASC 842; · To not reassess initial indirect costs; · Elect the hindsight practical expedient related to lease term and impairment; · Adopt the land easement practical expedient; · To not separate the non-lease components of a contract from the lease component for its office equipment asset class; · To not apply the recognition requirements to leases with terms of twelve months or less; and · To apply the portfolio approach in determination of the incremental borrowing rate. The Company has capitalized operating and finance leases for various real estate including corporate offices, trucking facilities and terminals, warehouses, and tractor parking as well as various types of equipment including tractors, trailers, forklifts, and office equipment. New real estate lease agreements will typically have initial terms between 3-15 years and new equipment lease agreements will typically have initial terms of 3-9 years. Leases with an initial term of 12 months or less ("short term leases") across all asset classes are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. Some of the Company’s leases include one or more options to renew, with renewals that can extend the lease term from 1 to 5 years. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The exercise of lease renewal options is at the Company’s sole discretion. Certain leases also include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Rights and obligations related to lease agreements the Company has signed but that have not yet commenced are not material. The Company has certain lease agreements related to its revenue equipment that contain residual value guarantees. These residual value guarantees require the Company to return the revenue equipment at the end of the lease term in a certain condition as specified by the lessor in the lease agreement. The Company determines whether an arrangement is classified as a lease at inception. The right-of-use assets and lease liabilities relating to operating leases are included in right-of-use assets, other current liabilities, and other long-term liabilities on the Company's consolidated balance sheets. The right-of-use assets and lease liabilities relating to finance leases are included in other long-term assets, current portion of long-term debt, and long-term debt, net of current portion on the Company's consolidated balance sheets. The Company's right-of-use assets represent its right to use the underlying assets for the lease term and the Company's right-of-use liabilities represent its obligation to make lease payments arising from the leases. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company's capitalized operating lease agreements generally do not provide an implicit rate. The Company developed an incremental borrowing rate based on the information available at the commencement date regarding the interest rate applicable to collateralized borrowings for a period similar to the original lease period. The incremental borrowing rates were used in determining the present value of lease payments which is reflected as the lease liability. The following table reflects the Company’s components of lease expenses for the three and six months ended June 30, 2019 (in millions): Three Months Ended Six Months Ended Classification June 30, 2019 Operating lease cost Revenue equipment Operations and maintenance $ 7.8 $ 13.5 Real estate Administrative expense 4.8 9.1 Total operating lease cost $ 12.6 $ 22.6 Finance lease cost Amortization of right-of-use assets Depreciation and amortization $ 1.1 $ 2.4 Interest on lease liabilities Interest expense 0.3 0.5 Total finance lease cost $ 1.4 $ 2.9 Total lease cost (a) $ 14.0 $ 25.5 (a) Short-term lease expense and variable lease expense are immaterial. The components of assets and liabilities for operating and finance leases are as follows as of June 30, 2019 (in millions): June 30, Classification 2019 Assets Capitalized operating lease right-of-use assets Right-of-use assets $ 106.8 Finance lease right-of-use assets Other long-term assets 25.7 Total lease assets $ 132.5 Liabilities Capitalized operating lease liabilities: Current Other current liabilities $ 28.4 Non-current Other long-term liabilities 78.4 Total capitalized operating lease liabilities $ 106.8 Finance lease liabilities: Current Current portion of long-term debt $ 6.2 Non-current Long-term debt, net of current portion 19.5 Total finance lease liabilities $ 25.7 Total lease liabilities $ 132.5 The following table is a summary of supplemental cash flows related to leases for the six months ended June 30, 2019 (in millions): Six Months Ended June 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from capitalized operating leases $ (17.1) Operating cash flows from finance leases (0.4) Financing cash flows from finance leases (2.8) Right-of-use assets obtained in exchange for lease obligations: Capitalized operating lease right-of-use assets $ 25.7 Finance lease right-of-use assets 9.2 The following table is the future payments on leases as of June 30, 2019 (in millions): Capitalized Operating Finance Year ending December 31, leases leases Total 2019 (1) $ 17.6 $ 4.5 $ 22.1 2020 28.6 7.6 36.2 2021 21.4 7.5 28.9 2022 16.8 4.2 21.0 2023 11.6 4.2 15.8 Thereafter 25.0 1.5 26.5 Total lease payments 121.0 29.5 150.5 Less: interest (14.2) (3.8) (18.0) Present value of lease liabilities $ 106.8 $ 25.7 $ 132.5 (1) Six months ending December 31, 2019 The following table is a summary of weighted average lease terms and discount rates for leases as of June 30, 2019: 2019 Weighted-average remaining lease term (years) Capitalized operating leases 5.13 Finance leases 4.05 Weighted-average discount rate Capitalized operating leases 5.54 % Finance leases 4.39 % The following table is the future payments under lease agreements as of December 31, 2018 prior to adoption of ASC 842 (in millions): Capital Leases Operating Leases Revenue Office Year ending December 31, Equipment and Terminals 2019 $ 5.7 $ 19.5 $ 11.9 2020 4.5 13.0 11.2 2021 4.3 5.7 9.5 2022 2.4 3.2 8.5 2023 2.9 0.3 6.6 Thereafter 0.8 — 23.0 Total minimum lease payments $ 20.6 $ 41.7 $ 70.7 Loan amount attributable to interest (2.4) Total (Present value of minimum lease payments on capital leases) 18.2 Less: current portion (4.8) Long-term capital leases $ 13.4 Lessor The adoption of this standard had a material impact on the Company’s financial position, resulting in recording of additional property and equipment and reductions to net investment in sales-type leases and prepaid and other current assets on its consolidated balance sheets of approximately $59.4 million, $55.8 million, and $3.6 million, respectively. The additional assets recorded on the balance sheet in property and equipment include tractors and trailers leased or available for lease to owner-operators. The standard did not have a material impact on the Company’s consolidated statements of operations and comprehensive loss, however, there have been additions and modifications to its existing financial disclosures. The Company leases tractors and trailers to certain of its owner-operators and accounts for these transactions as operating leases. Historically, the Company has accounted for these equipment leases as sales-type leases. Under the new guidance, the Company's equipment leases no longer qualify for sales-type lease treatment and are now treated as operating leases. This change in accounting treatment resulted in the derecognition of net investment in sales-type leases and recording the associated assets as if the agreements were always operating leases. The Company will no longer recognize a lease receivable, unearned interest income, or deferred gain related to sales-type leases and will recognize income from operating leases as payments are received. These leases typically have terms of 30 to 72 months and are collateralized by a security interest in the related revenue equipment. The Company recognizes income for these leases as payments are received over the lease term, which are reported in purchased freight on the statements of operations and comprehensive income (loss). The Company's equipment leases may include options for the lessee to purchase the equipment at the end of the lease term or terminate the lease prior to the end of the lease term. When an asset reaches the end of its useful economic life, the Company disposes of the asset. The Company recorded depreciation expense of $3.9 million and $8.8 million on its assets leased under operating leases for the three and six months ended June 30, 2019, respectively. Lease income from lease payments related to the Company's operating leases for the three and six months ended June 30, 2019, was $6.1 million and $11.6 million, respectively. The following table is the future minimum receipts on leases as of June 30, 2019 (in millions): Twelve months ending June 30, Amount 2020 $ 26.0 2021 20.9 2022 12.9 2023 6.3 2024 2.1 Thereafter 0.1 Total minimum lease receipts $ 68.3 The components of the net investment in sales-type leases as of December 31, 2018 prior to the adoption of ASC 842 are as follows (in millions): 2018 Minimum lease receivable $ 78.1 Deferred gain (10.1) Net minimum lease receivable 68.0 Unearned interest income (12.3) Net investment in sales-type leases 55.7 Current portion (16.2) $ 39.5 The following table is the future minimum receipts on leases as of December 31, 2018 prior to the adoption of ASC 842 (in millions): Year ending December 31, Amount 2019 $ 16.2 2020 14.5 2021 11.0 2022 11.2 2023 2.6 Thereafter 0.2 Total $ 55.7 |
ACQUISITIONS
ACQUISITIONS | 6 Months Ended |
Jun. 30, 2019 | |
ACQUISITIONS | |
ACQUISITIONS | NOTE 3 – ACQUISITIONS The Company is a leading consolidator of the open-deck freight market in North America. From Daseke Companies, Inc.’s inception in late 2008, the Company and Daseke Companies, Inc. have successfully acquired 20 open-deck trucking companies. Negotiations and discussions with potential targets are an integral part of the Company’s operations, and the Company may be in varying stages of the acquisition process, from infancy to very mature, at any point in time. To date, the primary reason for each acquisition was to add resources and services in geographic areas, customers and markets that the Company wants to serve, resulting in recognized goodwill. For each acquisition, the aggregate purchase price was allocated to the major categories of assets acquired and liabilities assumed at estimated fair values as of the acquisition date, which were based, in part, upon outside preliminary appraisals for certain assets and subject to change when additional information concerning final asset and liability values is obtained. The final purchase price allocations may result in adjustments to certain assets and liabilities, including the residual amount allocated to goodwill. The following is a summary of the allocation of the purchase price paid to the fair values of the net assets, net of cash acquired, of the 2018 acquisitions (in millions): (all amounts in U.S. dollars) Leavitt's Builders Kelsey Trail Aveda Accounts receivable $ 1.9 $ 8.4 $ 2.3 $ 37.3 Parts supplies 0.1 0.3 — — Prepaid and other current assets 0.4 1.5 0.4 2.5 Property and equipment 8.5 29.4 9.2 89.8 Goodwill 5.1 14.7 3.3 7.7 Intangible assets 3.6 10.6 1.5 15.0 Other long-term assets — 0.5 — — Deferred tax liability — (9.2) (2.7) (6.7) Accounts payable and other liabilities (4.9) (19.9) (8.0) (30.0) Total consideration paid (net of cash acquired) $ 14.7 $ 36.3 $ 6.0 $ 115.6 Leavitt’s Freight Service On August 1, 2018, the Company acquired 100% of the outstanding equity interests of Leavitt’s Freight Service, Inc. (Leavitt’s), based in Springfield, Oregon. Total consideration paid was $14.9 million of cash, which was funded with cash on hand. The acquisition was treated as an asset purchase because Leavitt’s was a qualified subchapter S-subsidiary acquired directly from an S-corporation; therefore, the values assigned to the intangible assets and goodwill are deductible for tax purposes. Approximately $0.3 million of transaction expenses were incurred in the acquisition, which will be deductible for tax purposes because the transaction qualified as an asset purchase. Builders Transportation On August 1, 2018, the Company acquired 100% of the outstanding equity interests of Builders Transportation Co., LLC (Builders), based in Memphis, Tennessee. Total consideration paid was $36.3 million, consisting of $30.0 million in cash, 399,530 shares of Daseke common stock valued at $3.4 million and the payoff of $2.9 million of outstanding debt. The cash consideration was funded with cash on hand. The acquisition was a stock purchase; therefore, the values assigned to the intangible assets and goodwill are not deductible for tax purposes. Approximately $0.2 million of transaction expenses were incurred in the acquisition, which are not deductible for tax purposes. Kelsey Trail Trucking On July 1, 2018, the Company acquired 100% of the outstanding equity interests of Kelsey Trail Trucking Ltd. (Kelsey Trail), based in Saskatoon, Saskatchewan province, Canada. Total consideration paid was $6.2 million, consisting of $5.3 million in cash and 95,859 shares of Daseke common stock valued at $0.9 million. The cash consideration was funded with cash on hand. The acquisition was a stock purchase; therefore, the values assigned to the intangible assets and goodwill are not deductible for tax purposes. Approximately $0.1 million of transaction expenses were incurred in the acquisition, which are not deductible for tax purposes. During the first quarter of 2019, goodwill and deferred tax liability were decreased by $0.9 million to adjust the beginning balance of deferred taxes. Aveda Transportation and Energy Services On June 6, 2018, the Company acquired all of the outstanding common shares of Aveda Transportation and Energy Services Inc., a corporation existing under the laws of the Province of Alberta, Canada (Aveda), pursuant to the Agreement and the Plan of Arrangement (the Agreement). Total consideration paid was $118.7 million, consisting of $27.3 million in cash, 1,612,979 shares of Daseke common stock valued at $15.4 million, and the payoff of $54.8 million of outstanding debt. The Company will also pay to the holders of Aveda common shares up to C$0.45 in cash per Aveda common share, contingent on and based on Aveda’s Company EBITDA (as defined in the Agreement) meeting certain thresholds set forth in the Agreement for the period beginning June 1, 2018 and ending on May 1, 2019 or with agreement of the parties, July 1, 2018 to June 30, 2019. The contingent consideration for this earn-out has been valued at an estimated $21.2 million. The Aveda acquisition was a stock purchase; therefore, the value assigned to the intangible assets and goodwill are not deductible for tax purposes. Approximately $1.1 million of transaction expenses were incurred in the acquisition, which are not deductible for tax purposes. During the first quarter of 2019, goodwill and deferred tax liability were increased by $0.7 million to adjust the beginning balance of deferred taxes. |
PREPAID AND OTHER CURRENT ASSET
PREPAID AND OTHER CURRENT ASSETS | 6 Months Ended |
Jun. 30, 2019 | |
PREPAID AND OTHER CURRENT ASSETS | |
PREPAID AND OTHER CURRENT ASSETS | NOTE 4 – PREPAID AND OTHER CURRENT ASSETS The components of prepaid expenses and other current assets are as follows as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Insurance $ 8.0 $ 7.4 Licensing, permits and tolls 6.0 5.6 Other prepaids 3.4 3.9 Other assets 2.0 4.4 Highway and fuel taxes 0.3 1.4 Assets held for sale — 3.6 $ 19.7 $ 26.3 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2019 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL AND INTANGIBLE ASSETS | NOTE 5 – GOODWILL AND INTANGIBLE ASSETS Goodwill represents the excess of the purchase price of all acquisitions over the estimated fair value of the net assets acquired. The Company performs an impairment test of goodwill annually as of October 1 or when impairment indicators arise. There was no goodwill impairment identified for three and six months ended June 30, 2019. The summary of changes in goodwill follows for the six months ended June 30, 2019 (in millions): Flatbed Specialized Total Goodwill balance at December 31, 2018 $ 101.5 $ 156.9 $ 258.4 Adjustments to previously recorded goodwill (net) — (0.3) (0.3) Foreign currency translation adjustment — 0.6 0.6 Goodwill balance at June 30, 2019 $ 101.5 $ 157.2 $ 258.7 Intangible assets consisted of the following as of June 30, 2019 and December 31, 2018 (in millions): As of June 30, 2019 As of December 31, 2018 Intangible Accumulated Intangible Intangible Accumulated Intangible Assets Amortization Assets, net Assets Amortization Assets, net Non-competition agreements $ 33.8 $ (16.3) $ 17.5 $ 33.8 $ (12.8) $ 21.0 Customer relationships 130.9 (38.2) 92.7 130.9 (33.5) 97.4 Trade names 90.6 — 90.6 90.6 — 90.6 Foreign currency translation adjustment 0.1 — 0.1 (0.2) — (0.2) Total intangible assets $ 255.4 $ (54.5) $ 200.9 $ 255.1 $ (46.3) $ 208.8 As of June 30, 2019, non-competition agreements and customer relationships had weighted average remaining useful lives of 2.5 and 9.9 years, respectively. Amortization expense for intangible assets with definite lives was $3.9 million and $6.2 million for the three months ended June 30, 2019 and 2018, respectively, and $8.2 million and $8.1 million for the six months ended June 30, 2019 and 2018, respectively. Future estimated amortization expense is as follows (in millions): Non-competition Customer Year ending December 31, Agreements Relationships 2019 (1) $ 3.3 $ 4.8 2020 5.4 9.5 2021 4.7 9.5 2022 3.9 9.5 2023 0.2 9.5 Thereafter — 49.9 Total $ 17.5 $ 92.7 (1) Six months ending December 31, 2019 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2019 | |
PROPERTY AND EQUIPMENT. | |
PROPERTY AND EQUIPMENT | NOTE 6 – PROPERTY AND EQUIPMENT The components of property and equipment are as follows as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Revenue equipment $ 705.1 $ 734.0 Buildings and improvements 62.9 61.9 Assets leased and available for lease to owner-operators 70.3 — Furniture and fixtures, office and computer equipment and vehicles 40.3 36.5 878.6 832.4 Accumulated depreciation (298.7) (259.7) $ 579.9 $ 572.7 Depreciation expense on property and equipment was $30.8 million and $25.5 million for the three months ended June 30, 2019 and 2018, respectively, and $62.3 million and $48.8 million for the six months ended June 30, 2019 and 2018, respectively. Depreciation expense and accumulated depreciation on assets leased and available for lease to owner-operaters was $5.1 million and $10.7 million for the three and six months ended June 30, 2019, respectively. Included in depreciaton expense is the net impact of the step-up in basis of fixed assets resulting from acquisitions of $5.9 million and $5.4 million for the three months ended June 30, 2019 and 2018, respectively, and $12.7 million and $9.5 million for the six months ended June 30, 2019 and 2018, respectively. |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 6 Months Ended |
Jun. 30, 2019 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
ACCRUED EXPENSES AND OTHER LIABILITIES | NOTE 7 – ACCRUED EXPENSES AND OTHER LIABILITIES The components of accrued expenses and other liabilities are as follows as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Brokerage and escorts $ 15.4 $ 12.6 Unvouchered payables 11.9 11.7 Other accrued expenses 10.0 8.0 Owner-operator deposits 8.8 9.3 Fuel and fuel taxes 1.8 1.2 Sales and local taxes payable 2.0 3.3 Interest 0.7 0.4 $ 50.6 $ 46.5 |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jun. 30, 2019 | |
LONG-TERM DEBT. | |
LONG-TERM DEBT | NOTE 8 – LONG-TERM DEBT Long-term debt consists of the following as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Term loan facility $ 491.0 $ 493.5 Equipment term loans 197.1 190.7 Finance and capital leases 25.7 18.2 713.8 702.4 Less current portion (62.4) (63.5) Less unamortized debt issuance costs (14.9) (16.2) Total long-term debt $ 636.5 $ 622.7 Term Loan Facility The Company has a $500.0 million term loan facility under a loan agreement with Credit Suisse AG, Cayman Islands Branch, as administrative agent, and the lenders party thereto (the Term Loan Facility) with a scheduled maturity date of February 27, 2024. Term loans under the Term Loan Facility are, at the Company’s election from time to time, comprised of alternate base rate loans (an ABR Borrowing) or adjusted LIBOR loans (a Eurodollar Rate Borrowing), with the applicable margins of interest being an alternate base rate (subject to a 2.00% floor) plus 4.00% per annum and LIBOR (subject to a 1.00% floor) plus 5.00% per annum. At June 30, 2019, the average interest rate on the Term Loan Facility was 7.5%. The Term Loan Facility is secured by all assets of the Company, except those assets collateralizing equipment and certain real estate lenders debt and subject to certain customary exceptions. The Term Loan Facility contains a financial covenant requiring the Company to maintain a consolidated total leverage ratio as of the last day of any fiscal quarter of less than or equal to 4.00 to 1.00, stepping down to 3.75 to 1.00 on March 31, 2021. The consolidated total leverage ratio is defined as the ratio of (i) consolidated total debt minus unrestricted cash and cash equivalents and cash and cash equivalents restricted in favor of the administrative agent and the lenders, to (ii) consolidated Adjusted EBITDA for the trailing 12 month period (with customary add-backs permitted to consolidated Adjusted EBITDA, including in respect of synergies and cost-savings reasonably identifiable and factually supportable that are anticipated to be realized in an aggregate amount not to exceed 25% of consolidated Adjusted EBITDA and subject to other customary limitations). The Term Loan Facility permits voluntary prepayments of borrowings. In certain circumstances (subject to exceptions, exclusions and, in the case of excess cash flow, step-downs described below), the Company may also be required to make an offer to prepay the Term Loan Facility if it receives proceeds as a result of certain asset sales, debt issuances, casualty or similar events of loss, or if it has excess cash flow (defined as an annual amount calculated using a customary formula based on consolidated Adjusted EBITDA, including, among other things, deductions for (i) the amount of certain voluntary prepayments of the Term Loan Facility and (ii) the amount of certain capital expenditures, acquisitions, investments and restricted payments). The percentage of excess cash flow that must be applied as a mandatory prepayment is 50%, 25% or 0% for excess cash flow periods for the year ending December 31, 2019 and beyond, depending upon the first lien leverage ratio. The Term Loan Facility contains (i) certain customary affirmative covenants that, among other things, require compliance with applicable laws, periodic financial reporting and notices of material events, payment of taxes and other obligations, maintenance of property and insurance, and provision of additional guarantees and collateral, and (ii) certain customary negative covenants that, among other things, restrict the incurrence of additional indebtedness, liens on property, sale and leaseback transactions, investments, mergers, consolidations, liquidations and dissolutions, asset sales, acquisitions, the payment of distributions, dividends, redemptions and repurchases of equity interests, transactions with affiliates, prepayments and redemptions of certain other indebtedness, burdensome agreements, holding company limitations, changes in fiscal year and modifications of organizational documents. ABL Facility The Company has a five-year, senior secured asset-based revolving line of credit with an aggregate maximum credit amount equal to $100.0 million (subject to availability under a borrowing base equal to 85% of the Company’s eligible accounts receivable, 80% of the Company’s eligible unbilled accounts receivable and 50% of parts supplies) under a credit agreement with PNC Bank, National Association, as administrative agent and the lenders party thereto. The ABL Facility’s maximum credit amount may be increased by $30.0 million pursuant to an uncommitted accordion. The ABL Facility also provides for the issuance of letters of credit subject to certain restrictions and a sublimit of $20 million, as defined in the credit agreement. The ABL Facility matures on February 27, 2022. As of June 30, 2019, the Company had a debit balance of $0.3 million, $13.9 million in letters of credit outstanding, and could incur approximately $85.2 million of additional indebtedness under the ABL Facility. Borrowings under the ABL Facility bear interest at rates based upon the Company’s fixed charge coverage ratio and, at the Company’s election from time to time, either a base rate plus an applicable margin or an adjusted LIBOR rate plus an applicable margin. Margins on the ABL Facility are adjusted, if necessary to the applicable rates set forth in the following table corresponding to the fixed charge coverage ratio for the trailing 12 month period on the last day of the most recently completed fiscal quarter. Fixed Charge Coverage Ratio Base Rate Margins LIBOR Rate Margins Less than 1.25 to 1.00 2.25 % 3.25 % Greater than or equal to 1.25 to 1.00, but less than 1.50 to 1.00 1.75 % 2.75 % Greater than or equal to 1.50 to 1.00, but less than 1.75 to 1.00 1.25 % 2.25 % Greater than or equal to 1.75 to 1.00 0.75 % 1.75 % The ABL Facility was amended on June 15, 2018, to adjust margins, if necessary, on the ABL Facility beginning in the fiscal quarter ended September 30, 2018, to the applicable rates set forth in the following table corresponding to the average RLOC Utilization for the trailing 12 month period on the last day of the most recently completed fiscal quarter. RLOC Utilization at a particular date shall mean an amount equal to (a)(i) outstanding amount of Revolving Advances plus (ii) the outstanding amount of the Swing Loans plus (iii) the aggregate Maximum Undrawn Amount of all outstanding Letters of Credit, divided by (b) Maximum Revolving Advance Amount, each as defined in the credit agreement. RLOC Utilization Base Rate Margins LIBOR Rate Margins Less than 33.3% 0.50 % 1.50 % Greater than or equal to 33.3%, but less than 66.6% 0.75 % 1.75 % Greater than or equal to 66.6% 1.00 % 2.00 % At June 30, 2019, the interest rate on the ABL Facility was 6.00%. The ABL Facility is secured by all of the Company’s U.S.-based accounts receivable, parts supplies, cash and cash equivalents excluding proceeds of Term Loan Facility, securities and deposit accounts and other general assets not included in the Term Loan Facility collateral. The ABL Facility contains (i) a financial covenant similar to the consolidated total leverage ratio required under the Term Loan Facility requiring a leverage ratio of less than or equal to 4.00 to 1.00 for the fiscal quarter, stepping down to 3.75 to 1.00 on March 31, 2021 and (ii) during any period after a default or event of default or after excess availability falling below the greater of (x) $15.0 million and (y) 20% of the maximum credit amount, continuing until such time as no default or event of default has existed and excess availability has exceeded such amounts for a period of 60 consecutive days, a financial covenant requiring the Company to maintain a minimum consolidated fixed charge coverage ratio of 1.00x, tested on a quarterly basis. The Company’s fixed charge coverage ratio is defined as the ratio of (1) consolidated Adjusted EBITDA minus unfinanced capital expenditures, cash taxes and cash dividends or distributions, to (2) the sum of all funded debt payments for the four-quarter period then ending (with customary add-backs permitted to consolidated Adjusted EBITDA). The ABL Facility contains affirmative and negative covenants similar to those in the Term Loan Facility, together with such additional terms as are customary for a senior secured asset-based revolving credit facility. As of June 30, 2019, the Company was in compliance with all covenants contained in the Term Loan and ABL Facilities. Equipment Term Loans and Mortgages As of June 30, 2019, the Company had term loans collateralized by equipment in the aggregate amount of $193.7 million with 41 lenders (Equipment Term Loans). The Equipment Term Loans bear interest at rates ranging from 1.5% to 10.7%, require monthly payments of principal and interest and mature at various dates through January 2028. Certain of the Equipment Term Loans contain conditions, covenants, representations and warranties, events of default, and indemnification provisions applicable to the Company and certain of its subsidiaries that are customary for equipment financings, including, but not limited to, limitations on the incurrence of additional debt and the prepayment of existing indebtedness, certain payments (including dividends and other distributions to persons not party to its credit facility) and transfers of assets. As of June 30, 2019, the Company has a bank mortgage loan with a balance of $3.4 million incurred to finance the construction of the headquarters and terminal in Redmond, Oregon. The mortgage loan is collateralized by such property and buildings. The mortgage is payable in monthly installments of $15,776, including interest at 3.7% through November 2020. The interest rate and monthly payments will be adjusted on November 1, 2020 to a rate of 2.5%, plus the three-year advance rate published by the Federal Home Loan Bank of Seattle in effect 45 days prior to November 1, 2020 (which will not be less than 3.7%). The bank mortgage loan matures November 1, 2023. Finance and Capital Leases The Company leases certain equipment under long-term finance and capital lease agreements that expire on various dates through May 2025. As of December 31, 2018, the book value of the property and equipment recorded under capital leases was $16.6 million, net of accumulated depreciation of $7.8 million. Depreciation expense related to capital lease equipment was $0.7 million and $1.3 million for the three and six months ended June 30, 2018, respectively. See Note 2 for information on finance leases. Future Payments Future principal payments on long-term debt as of June 30, 2019 are as follows (in millions): Twelve months ending June 30, Term Loan Facility Equipment Term Loans Total 2020 $ 5.0 $ 51.1 $ 56.1 2021 2.5 43.6 46.1 2022 2.5 36.0 38.5 2023 11.3 27.9 39.2 2024 2.5 27.6 30.1 Thereafter 467.2 10.9 478.1 Total long-term debt $ 491.0 $ 197.1 $ 688.1 |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2019 | |
INCOME TAXES | |
INCOME TAXES | NOTE 9 – INCOME TAXES The recognized deferred tax liabilities for final valuations of intangible assets related to the December 2017 acquisitions and then remeasured using the Tax Cuts and Jobs Act (TCJA) rates for the three months ended June 30, 2018. The difference between the Company’s effective tax rate and the federal statutory rate primarily results from state income taxes and nondeductible expenses, including the effect of the per diem pay structure for drivers. State tax rates vary among states and range from approximately 1% to 6%, although some state rates are higher and a small number of states do not impose an income tax. Regarding the new tax on global intangible low-taxed income (GILTI), which became applicable in 2018 as part of the Tax Cuts and Jobs Act of 2017 (TCJA), the Company will treat GILTI as a period cost if and when incurred. There were no changes in uncertain tax positions during the six months ended June 30, 2019. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2019 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS’ EQUITY | NOTE 10 – STOCKHOLDERS’ EQUITY Common Stock Common stock has voting rights – one vote for each share of common stock. On February 14, 2018, the Company and one of the Company’s stockholders entered into an underwriting agreement with Cowen and Company, LLC and Stifel, Nicolaus & Company, Incorporated, as representatives of the several underwriters named therein, in connection with an underwritten public offering of 7,500,000 shares of the Company’s common stock, at a price to the public of $10.60 per share. Pursuant to the underwriting agreement, the Company granted the underwriters a 30-day option to purchase up to an additional 1,125,000 shares of common stock, which was exercised in full on February 16, 2018 and closed simultaneously with the offering on February 20, 2018. Net proceeds received by the Company were approximately $84.4 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. The Company has used and intends to continue to use the net proceeds from the offering for general corporate purposes, including, among other things, working capital, capital expenditures, debt repayment or refinancing or the financing of possible future acquisitions. On June 1, 2018, after having met the earnout provisions contained in the Merger Agreement, the Company issued 5,000,000 shares of the Company’s common stock, par value $0.0001 per share, pro rata among the Private Daseke Stockholders (Earnout Shares). The Earnout Shares were issued in reliance upon an exemption from the registration requirements of the Securities Act of 1933, as amended (the Securities Act), pursuant to Section 4(a)(2) thereof, which exempts transactions by an issuer not involving any public offering on the basis that the securities were offered and sold in a non-public offering to “accredited investors” (as defined in Rule 501(a) of Regulation D under the Securities Act). Private Daseke, which refers to Daseke, Inc. and its subsidiaries prior to the merger with Hennessy, engaged a purchaser representative to serve as the purchaser representative for two Private Daseke stockholders who were not “accredited investors,” which purchaser representative met all of the conditions set forth in Rule 501(i) of Regulation D, as required to comply with applicable federal securities laws in connection with the issuance of shares of the Company’s common stock to these two Private Daseke stockholders pursuant to the Merger Agreement. On June 6, 2018, as part of the consideration paid for the Aveda acquisition, the Company issued 1,612,979 shares of Daseke common stock valued at $15.4 million. See Note 3 for additional details about the Aveda acquisition. On July 1, 2018, as part of the consideration paid for the Kelsey Trail acquisition, the Company issued 95,859 shares of Daseke common stock valued at $0.9 million. See Note 3 for additional details about the Kelsey Trail acquisition. On August 1, 2018, as part of the consideration paid for the Builders acquisition, the Company issued 399,530 shares of Daseke common stock valued at $3.4 million. See Note 3 for additional details about the Builders acquisition. As of June 30, 2019, the Company has approximately 1.2 million shares of common stock reserved for future issuances of stock options and restricted stock units under the Company’s 2017 Omnibus Incentive Plan. See Note 11 for additional details about the Company’s stock-based compensation plan. Preferred Stock The Company has issued and outstanding 650,000 shares of Series A Preferred Stock with a redemption value of $65.0 million. The par value of Series A Preferred Stock is $0.0001 per share. Additional features of this preferred stock are as follows: Under the Certificate of Designations, Preferences, Rights and Limitations of the Series A Preferred Stock (the Certificate of Designations), each share of Series A Preferred Stock will be convertible, at the holder’s option at any time, initially into approximately 8.6957 shares of the Company’s common stock (assuming a conversion price of approximately $11.50 per share), subject to specified adjustments as set forth in the Certificate of Designations. If any holder elects to convert its Series A Preferred Stock after the seven-year anniversary of the issue date, if the then-current Conversion Price (as defined in the Certificate of Designations) exceeds the Weighted Average Price (as defined in the Certificate of Designations) for the common stock during any ten consecutive Trading Days (as defined in the Certificate of Designations), at its option by delivery of a Notice of Conversion in accordance with Section 8(b) of the Certificate of Designations no later than five business days following such tenth consecutive Trading Day, to convert any or all of such holder’s shares of Series A Preferred Stock into, at the Company’s sole discretion, either common stock, cash or a combination of common stock and cash; provided, that the Company shall provide such converting holder notice of its election within two Trading Days of receipt of the Notice of Conversion; provided further, that in the event the Company elects to issue common stock for all or a portion of such conversion, the Conversion Rate for such conversion (subject to the limitations set forth in Section 11 of the Certificate of Designations) shall mean the quotient of the Liquidation Preference (as defined in the Certificate of Designations) divided by the average Weighted Average Price for the common stock during the 20 consecutive Trading Days commencing on the Trading Day immediately following the Trading Day on which the Company provided such notice. If the Company does not elect a settlement method prior to the deadline set forth in the Certificate of Designations, the Company shall be deemed to have elected to settle the conversion entirely in common stock. Based on the assumed conversion rate, a total of 5,652,173 shares of common stock would be issuable upon conversion of all of the currently outstanding shares of Series A Preferred Stock. On or after the third anniversary of the initial issuance date but prior to the fifth anniversary of the initial issuance date, the Company will have the right, at its option, to give notice of its election to cause all outstanding shares of the Series A Preferred Stock to be automatically converted into shares of the Company’s common stock at the then-effective conversion rate, if the Weighted Average Price of Company’s common stock equals or exceeds 140% of the then-current conversion price for at least 20-trading days (whether or not consecutive) in a period of 30 consecutive trading days. On or after the fifth anniversary of the initial issuance date but prior to the seventh anniversary of the initial issuance date, the Company will have the right, at its option, to give notice of its election to cause all outstanding shares of the Series A Preferred Stock to be automatically converted into shares of Company’s common stock at the then-effective conversion rate, if the Weighted Average Price of Company’s common stock equals or exceeds 115% of the then-current conversion price for at least 20-trading days (whether or not consecutive) in a period of 30 consecutive trading days. On or after the seventh anniversary of the initial issuance date, the Company will have the right, at its option, to give notice of its election to cause all outstanding shares of the Series A Preferred Stock to be automatically converted into shares of Company’s common stock at the then-effective conversion rate, if the Weighted Average Price of Company’s common stock equals or exceeds the then-current conversion price for at least 10 consecutive trading days. If the Company undergoes certain fundamental changes (as more fully described in the Certificate of Designations but including, among other things, certain change-in-control transactions, recapitalizations, asset sales and liquidation events), each outstanding share of Series A Preferred Stock may, within 15 days following the effective date of such fundamental change and at the election of the holder, be converted into Company’s common stock at a conversion rate (subject to certain adjustments) equal to (i) the greater of (A) the sum of the conversion rate on the effective date of such fundamental change plus the additional shares received by holders of Series A Preferred Stock following such fundamental change (as set forth in the Certificate of Designations) and (B) the quotient of (x) $100.00, divided by (y) the greater of (1) the applicable holder stock price and (2) 66 2/3% of the closing sale price of the Company’s common stock on the issue date plus (ii) the number of shares of Company’s common stock that would be issued if any and all accumulated and unpaid dividends were paid in shares of Company’s common stock. The Series A Preferred Stock contains limitations that prevent the holders thereof from acquiring shares of the Company’s common stock upon conversion that would result in (i) the number of shares beneficially owned by such holder and its affiliates exceeding 9.99% of the total number of shares of the Company’s common stock then outstanding or (ii) the Series A Preferred Stock being converted into more than 19.99% of the shares of the Company’s common stock outstanding on the initial issue date of the Series A Preferred Stock (subject to appropriate adjustment in the event of a stock split, stock dividend, combination or other similar recapitalization) without, in the latter instance, stockholder approval of such issuance. Additional features of the Series A Preferred Stock are as follows: a. Liquidation – In the event of liquidation, holders of Series A Preferred Stock have preferential rights to liquidation payments over holders of common stock. Holders of Series A Preferred Stock shall be paid out of the assets of the Company at an amount equal to $100 per share plus all accumulated and unpaid dividends. b. Dividends – Dividends on the Series A Preferred Stock are cumulative at the Dividend Rate. The “Dividend Rate” is the rate per annum of 7.625% per share of Series A Preferred Stock on the liquidation preference ($100 per share). Dividends are payable quarterly in arrears in cash or, at the Company’s election and subject to the receipt of the necessary shareholder approval (to the extent necessary), in shares of the Company’s common stock. On February 27, 2019 the Company’s board of directors declared a quarterly dividend of $1.91 per share, which was paid on March 15, 2019. On May 21, 2019, the Company’s board of directors declared a second quarterly dividend of $1.91 per share, which was paid on June 15, 2019. On February 27, 2018 the Company’s board of directors declared a quarterly dividend of $1.91 per share, which was paid on March 15, 2018. On May 22, 2018, the Company’s board of directors declared a second quarterly dividend of $1.91 per share, which was paid on June 20, 2018. c. Voting rights – Except as required by Delaware law, holders of the Series A Preferred Stock will have no voting rights except with respect to the approval of any material and adverse amendment to the Company’s certificate of incorporation, and certain significant holders of Series A Preferred Stock may have approval rights with respect to certain key economic terms of the Series A Preferred Stock, as set forth in the Certificate of Designations. Warrants At June 30, 2019, there were a total of 35,040,658 warrants outstanding to purchase 17,520,329 shares of the Company’s common stock. The Company issued warrants (the Public Warrants) to purchase its common stock which were originally issued as part of units in the initial public offering (the IPO) of Hennessy (as defined below). There are 19,959,902 Public Warrants outstanding. The Company also issued 15,080,756 warrants (the Private Placement Warrants) to the sponsor in a private placement that closed simultaneously with the consummation of the IPO. Each warrant entitles the registered holder to purchase one-half of one share of the Company’s common stock at a price of $5.75 per one-half of one share ($11.50 per whole share), subject to adjustment. The warrants may be exercised only for a whole number of shares of the Company’s common stock. No fractional shares will be issued upon exercise of the warrants. The warrants will expire on February 27, 2022, five years after the completion of the merger with Hennessy, or earlier upon redemption or liquidation. The warrants are listed on the NASDAQ market under the symbol DSKEW. The Company may call the Public Warrants for redemption at a price of $0.01 per warrant if, and only if, the reported last sale price of the Company’s common stock equals or exceeds $24.00 per share for any 20-trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the Public Warrant holders. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2019 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | NOTE 11 – STOCK-BASED COMPENSATION Under the 2017 Omnibus Incentive Plan (the Plan), the Company may grant awards of stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards and performance awards. Under the Plan, the Company is authorized to issue up to 4.5 million shares of common stock. All awards granted were authorized under the Plan. These awards generally vest annually on a pro-rata basis over a five-year period on the anniversary of each grant date. We also grant awards to our directors under the Plan. The awards granted to directors vest ratably over periods of one or five years annually on the anniversary of each grant date. All stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized on a straight-line basis as expense over the employees’ requisite service period. Forfeitures are recorded as a cumulative adjustment to stock-based compensation expense in the period forfeitures occur. Aggregate stock-based compensation charges, net of forfeitures, were $0.9 million and $0.9 million during the three months ended June 30, 2019 and 2018, respectively, and $1.9 million and $1.8 million during the six months ended June 30, 2019 and 2018, respectively. These expenses are included as a component of salaries, wages and employee benefits on the accompanying consolidated statements of operations and comprehensive loss. As of June 30, 2019, there was $6.0 million and $5.6 million of unrecognized stock-based compensation expense related to stock options and restricted stock units, respectively. This expense will be recognized over the weighted average periods of 3.3 years for stock options and 3.1 years for restricted stock units. Stock Options The following table summarizes stock option grants under the Plan: Grantee Type # of Issued and Vesting Weighted Weighted Average Director Group 150,000 145,000 5 years $ 9.98 $ 4.36 Employee Group 2,384,094 2,268,673 5 years $ 9.22 $ 3.99 Total 2,413,673 The Company’s calculations of the fair value of stock options granted during the six months ended June 30, 2019 were made using the Black-Scholes option-pricing model. The fair value of the Company’s stock option grants was estimated utilizing the following assumptions for the six months ended June 30, 2019: Weighted average expected life 6.5 years Risk-free interest rate 2.55% to 2.58% Expected volatility 37.50% to 37.51% Expected dividend yield 0.00% Since the Company does not have a sufficient history of exercise behavior, expected term is calculated using the assumption that the options will be exercised ratably from the date of vesting to the end of the contractual term for each vesting tranche of awards. The risk-free interest rate is based on the U.S. Treasury yield curve for the period of the expected term of the stock option. Expected volatility is calculated using an index of publicly traded peer companies. A summary of option activity under the Plan as of June 30, 2019 and changes during the six months then ended are as follows: Shares Weighted Weighted Aggregate Outstanding as of January 1, 2019 2,066,529 $ 10.23 8.5 $ — Granted 382,500 3.82 Forfeited or expired (35,356) 10.33 Outstanding as of June 30, 2019 2,413,673 $ 9.21 8.3 $ — Exercisable as of June 30, 2019 624,620 $ 10.28 7.8 $ — Vested and expected to vest as of June 30, 2019 2,413,673 $ 9.21 8.3 $ — The stock options’ maximum contract term is ten years. The total weighted average fair value of options granted during the six months ended June 30, 2019 and 2018 was $0.6 million and $1.2 million, respectively. Restricted Stock Units Restricted stock units are nontransferable until vested and the holders are entitled to receive dividends with respect to the non-vested units. Prior to vesting, the grantees of restricted stock units are not entitled to vote the shares. Restricted stock unit awards vest in equal annual increments over the vesting period. The following table summarizes restricted stock unit grants under the Plan: Grantee Type # of Issued and Outstanding Vesting Grant Date Director Group 121,212 89,700 1 year $ 5.78 Employee Group 1,568,655 535,561 5 years $ 10.59 Total 625,261 A summary of restricted stock unit awards activity under the Plan as of June 30, 2019 and changes during the six months then ended are as follows: Units Weighted Non-vested as of January 1, 2019 841,361 $ 10.44 Granted 89,700 4.32 Vested (174,296) 10.19 Forfeited (131,504) 10.51 Non-vested as of June 30, 2019 625,261 $ 9.67 |
DEFINED CONTRIBUTION PLAN
DEFINED CONTRIBUTION PLAN | 6 Months Ended |
Jun. 30, 2019 | |
DEFINED CONTRIBUTION PLAN | |
DEFINED CONTRIBUTION PLAN | NOTE 12 – DEFINED CONTRIBUTION PLAN On January 1, 2015, the Company established the Daseke, Inc. 401(k) Retirement Plan (the Retirement Plan). The Retirement Plan is a defined contribution plan and intended to qualify under The Employee Retirement Income Security Act of 1974 (ERISA) provisions of 401(k). Under the safe harbor matching requirements, the Company had expenses of $1.4 million and $1.1 million for the three months ended June 30, 2019 and 2018, respectively, and $2.8 million and $1.9 million for the six months ended June 30, 2019 and 2018, respectively. The Company sponsored defined contribution profit-sharing plans, including 401(k) provisions, for substantially all employees of acquired companies whose plans were merged into the Retirement Plan effective January 1, 2019. Matching contributions for 401(k) defined contribution plans not yet merged into the Retirement Plan totaled approximately $0.1 million and $0.2 million for the three and six months ended June 30, 2018, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 13 – COMMITMENTS AND CONTINGENCIES Letters of Credit The Company had outstanding letters of credit as of June 30, 2019 totaling approximately $15.9 million, including those disclosed in Note 8. These letters of credit are related to liability and workers compensation insurance claims. Contingencies The Company is involved in certain claims and pending litigation arising in the normal course of business. These proceedings primarily involve claims for personal injury or property damage incurred in the transportation of freight or for personnel matters. The Company maintains liability insurance to cover liabilities arising from these matters but is responsible to pay self-insurance and deductibles on such matters up to a certain threshold before the insurance is applied. |
REPORTABLE SEGMENTS
REPORTABLE SEGMENTS | 6 Months Ended |
Jun. 30, 2019 | |
REPORTABLE SEGMENTS | |
REPORTABLE SEGMENTS | NOTE 14 – REPORTABLE SEGMENTS The Company evaluates the performance of the segments primarily based on their respective revenues and operating income. Accordingly, interest expense and other non-operating items are not reported in segment results. In addition, the Company has disclosed a corporate segment, which is not an operating segment and includes acquisition transaction expenses, corporate salaries, interest expense and other corporate administrative expenses and intersegment eliminations. The Company’s operating segments also provide transportation and related services for one another. Such services are generally billed at cost, and no profit is earned. Such intersegment revenues and expenses are eliminated in the Company’s consolidated results. Intersegment revenues and expenses for the Flatbed Solutions segment totaled $2.5 million and $1.3 million for the three months ended June 30, 2019 and 2018, respectively, and $4.6 million and $2.1 million for the six months ended June 30, 2019 and 2018, respectively. Intersegment revenues and expenses for the Specialized Solutions segment totaled $2.0 million and $2.4 million for the three months ended June 30, 2019 and 2018, respectively, and $4.1 million and $3.9 million for the six months ended June 30, 2019 and 2018, respectively. The following tables reflect certain financial data of the Company’s reportable segments for the three and six months ended June 30, 2019 and 2018 (in millions): Flatbed Specialized Solutions Solutions Corporate/ Consolidated Segment Segment Eliminations Total Three Months Ended June 30, 2019 Total revenue $ 174.9 $ 280.7 $ (5.0) $ 450.6 Company freight 55.0 154.5 (2.6) 206.9 Owner operator freight 73.4 49.6 (1.3) 121.7 Brokerage 25.7 47.7 (0.6) 72.8 Logistics 0.6 12.5 — 13.1 Fuel surcharge 20.2 16.4 (0.5) 36.1 Operating income (loss) 6.1 11.1 (12.5) 4.7 Depreciation 12.3 23.4 0.1 35.8 Amortization of intangible assets 1.3 2.6 — 3.9 Non-cash operating lease expense 3.1 3.5 0.1 6.7 Interest expense 2.7 3.3 6.7 12.7 Income (loss) before income tax 3.5 8.1 (18.7) (7.1) Total assets 501.5 932.4 69.1 1,503.0 Cash capital expenditures 2.3 5.4 0.5 8.2 Three Months Ended June 30, 2018 Total revenue $ 162.2 $ 218.4 $ (3.7) $ 376.9 Company freight 46.2 116.3 (2.5) 160.0 Owner operator freight 72.3 40.9 (0.6) 112.6 Brokerage 23.9 36.4 (0.2) 60.1 Logistics 0.7 8.2 — 8.9 Fuel surcharge 19.1 16.6 (0.4) 35.3 Operating income (loss) 9.3 7.1 (7.9) 8.5 Depreciation 6.7 18.8 — 25.5 Amortization of intangible assets 2.5 3.7 — 6.2 Interest expense 2.0 2.7 6.4 11.1 Income (loss) before income tax 7.4 4.6 (13.0) (1.0) Total assets 409.5 857.3 57.3 1,324.1 Cash capital expenditures 1.9 21.4 0.2 23.5 Flatbed Specialized Solutions Solutions Corporate/ Consolidated Segment Segment Eliminations Total Six Months Ended June 30, 2019 Total revenue $ 343.0 $ 550.2 $ (9.6) $ 883.6 Company freight 110.2 308.4 (5.5) 413.1 Owner operator freight 142.0 93.3 (2.6) 232.7 Brokerage 51.1 93.7 (0.6) 144.2 Logistics 1.3 24.2 — 25.5 Fuel surcharge 38.4 30.6 (0.9) 68.1 Operating income (loss) 9.4 18.8 (22.8) 5.4 Depreciation 25.4 47.4 0.2 73.0 Amortization of intangible assets 3.0 5.2 — 8.2 Non-cash operating lease expense 5.5 7.6 0.2 13.3 Interest expense 5.3 6.6 13.5 25.4 Income (loss) before income tax 4.4 13.1 (35.8) (18.3) Cash capital expenditures 2.9 8.2 1.0 12.1 Six Months Ended June 30, 2018 Total revenue $ 307.2 $ 403.3 $ (6.0) $ 704.5 Company freight 91.4 217.0 (3.8) 304.6 Owner operator freight 131.6 77.6 (1.1) 208.1 Brokerage 46.9 59.6 (0.3) 106.2 Logistics 1.4 18.3 (0.1) 19.6 Fuel surcharge 35.9 30.8 (0.7) 66.0 Operating income (loss) 16.2 12.3 (12.2) 16.3 Depreciation 13.7 35.1 — 48.8 Amortization of intangible assets 2.9 5.2 — 8.1 Interest expense 3.8 5.2 12.4 21.4 Income (loss) before income tax 12.6 8.2 (23.0) (2.2) Cash capital expenditures 2.4 28.3 0.4 31.1 |
LOSS PER SHARE
LOSS PER SHARE | 6 Months Ended |
Jun. 30, 2019 | |
LOSS PER SHARE | |
LOSS PER SHARE | NOTE 15 – LOSS PER SHARE Three Months Ended Six Months Ended June 30, June 30, (in millions, except per share data) 2019 2018 2019 2018 Numerator: Net income (loss) $ (6.4) $ 13.5 $ (15.7) $ 12.7 Less Series A preferred dividends (1.3) (1.3) (2.5) (2.5) Allocation of earnings to non-vested participating restricted stock units — (0.2) — (0.2) Net income (loss) attributable to common stockholders $ (7.7) $ 12.0 $ (18.2) $ 10.0 Denominator: Weighted-average shares outstanding 64.5 59.5 64.5 56.9 Weighted average non-vested participating restricted stock units — 1.1 — 1.0 Denominator for basic and diluted EPS – weighted-average shares 64.5 60.6 64.5 57.9 Basic and diluted EPS $ (0.12) $ 0.20 $ (0.28) $ 0.17 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2019 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 16 – SUBSEQUENT EVENTS On July 30, 2019, the Company internally announced a plan to integrate three operating segments with three other operating segments (Project Synchronize or the Plan), which will reduce the number of operating segments from 16 to 13. The Plan is being implemented to streamline and reduce the Company’s cost structure, improve asset utilization and capitalize on operational synergies. The Company is in the process of determining the estimated impact of Project Synchronize on the financial statements. |
NATURE OF OPERATIONS AND SUMM_2
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation | Basis of Presentation These interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ended December 31, 2019. The consolidated balance sheet as of December 31, 2018 has been derived from the audited consolidated financial statements at that date. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes for the year ended December 31, 2018 as set forth in the Company’s Annual Report on Form 10-K, filed with the SEC on March 8, 2019. Certain items have been reclassified for presentation purposes to conform to the accounting policies of the consolidated entity. These reclassifications had no material impact on income from operations, net loss and comprehensive loss, the balance sheets or statements of cash flows. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Daseke, Inc. and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Deferred Financing Fees | Deferred Financing Fees In conjunction with obtaining long-term debt, the Company incurred financing costs which are being amortized using the straight-line method, which approximates the effective interest rate method, over the terms of the obligations. As of June 30, 2019 and December 31, 2018, the balance of deferred finance charges was $14.9 million and $16.2 million, respectively, which is included as a reduction of long-term debt, net of current portion in the consolidated balance sheets. Amortization expense was $0.8 million for each of the three months periods ended June 30, 2019 and 2018, and $1.5 million and $1.4 million for the six months ended June 30, 2019 and 2018, respectively. Amortization expense is included in interest expense in the consolidated statements of operations and comprehensive income (loss). |
Fair Value Measurements | Fair Value Measurements The Company follows the accounting guidance for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a framework for measuring fair value and expands disclosures about fair value measurements. The three levels of the fair value framework are as follows: Level 1 - Quoted market prices in active markets for identical assets or liabilities. Level 2 - Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3 - Unobservable inputs reflecting the reporting entity’s own assumptions or external inputs from inactive markets. A financial asset or liability’s classification within the framework is determined based on the lowest level of input that is significant to the fair value measurement. Contingent Consideration The contingent consideration liabilities represent future payment obligations for certain EBITDA thresholds related to the Company’s acquisitions over a defined period of time. See Note 3 for additional details on the future payment obligations connected to the Company’s acquisitions. The fair value of the Company’s contingent consideration liabilities are determined using estimates based on discount rates that reflect the risk involved and the projected EBITDA of the acquired businesses, therefore the liabilities are classified within Level 3 of the fair value framework. The balance of contingent consideration as of June 30, 2019 and December 31, 2018 was $21.5 million and $21.9 million, respectively. The changes in the fair value were the same for the three and six months ended June 30, 2019 and 2018. The table below is a summary of the changes in the fair value of this liability for the six months ended June 30, 2019 and 2018 (in millions): Six Months Ended June 30, 2019 2018 Balance at beginning of period $ 21.9 $ 0.8 Fair value of earn-out liability for acquisition — 20.3 Change in fair value (0.4) (0.7) Balance at end of period $ 21.5 $ 20.4 |
Stock-Based Compensation | Stock-Based Compensation Awards of equity instruments issued to employees and directors are accounted for under the fair value method of accounting and recognized in the consolidated statements of operations and comprehensive loss. Compensation cost is measured for all stock-based awards at fair value on the date of grant and recognized using the straight-line method over the service period over which the awards are expected to vest. Fair value of all time-vested options as of the date of grant is estimated using the Black-Scholes option valuation model, which was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. Option valuation models require the input of highly subjective assumptions, including the expected stock price volatility. Since the Company does not have a sufficient history of exercise behavior, expected term is calculated using the assumption that the options will be exercised ratably from the date of vesting to the end of the contractual term for each vesting tranche of awards. The risk-free interest rate is based on the U.S. Treasury yield curve for the period of the expected term of the stock option. Expected volatility is calculated using an index of publicly traded peer companies. Fair values of non-vested stock awards (restricted stock units) are equal to the market value of the common stock on the date of the award with compensation costs amortized over the vesting period of the award. |
Segment Reporting | Segment Reporting The Company determines its operating segments based on the information utilized by the chief operating decision maker to allocate resources and assess performance. Based on this information, the Company has determined it had 16 operating segments as of June 30, 2019 and 2018 that are aggregated into two reportable segments: Flatbed Solutions, which delivers its services using primarily flatbed transportation equipment to meet the needs of high-volume, time-sensitive shippers, and Specialized Solutions, which delivers transportation and logistics solutions for super heavy haul, high-value customized and over-dimensional loads, many of which require engineering and customized equipment. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per common share is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share reflect the potential dilution of earnings per share that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the Company’s earnings (loss). For the three and six months ended June 30, 2019 and 2018, shares of the Company’s 7.625% Series A Convertible Cumulative Preferred Stock (Series A Preferred Stock) and outstanding stock options were not included in the computation of diluted earnings (loss) per share as their effects were anti-dilutive. Additionally, for the three and six months ended June 30, 2019 and 2018, there was no dilutive effect from the Merger Agreement earn-out provision found in the Agreement and Plan of Merger, dated December 22, 2016, in which a wholly-owned subsidiary of Hennessy Capital Acquisition Corp. II (Hennessy) merged with and into Daseke, with Daseke surviving as a direct wholly-owned subsidiary of Hennessy, (the Merger Agreement) or the outstanding warrants to purchase shares of the Company’s common stock (the common stock purchase warrants). See Note 15 for the effects of non-vested restricted stock units on basic and diluted earnings per share under the two-class method. |
Common Stock Purchase Warrants | Common Stock Purchase Warrants The Company accounts for the issuance of common stock purchase warrants in connection with equity offerings in accordance with the provisions of the Accounting Standards Codification (ASC) 815, Derivatives and Hedging (Topic 815). The Company classifies as equity any contract that (i) requires physical settlement or net-share settlement or (ii) gives the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement). The Company classifies as assets or liabilities any contract that (i) requires net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the control of the Company) or (ii) gives the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). See Note 10 for additional details on the common stock purchase warrants. The Company assessed the classification of its common stock purchase warrants and determined that such instruments meet the criteria for equity classification at the time of issuance. |
Foreign Currency Gains and Losses | Foreign Currency Gains and Losses The functional currency for all operations except Canada is the U.S. dollar. The local currency is the functional currency for the Company’s operations in Canada. For these operations, assets and liabilities are translated at the rates of exchange on the consolidated balance sheet date, while income and expense items are translated at average rates of exchange during the period. The resulting gains or losses arising from the translation of accounts from the functional currency into U.S. dollars are included as a separate component of stockholders’ equity in accumulated other comprehensive income until a partial or complete liquidation of the Company’s net investment in the foreign operation. From time to time, the Company’s foreign operations may enter into transactions that are denominated in a currency other than their functional currency. These transactions are initially recorded in the functional currency of the operating company based on the applicable exchange rate in effect on the date of the transaction. Monthly, these transactions are remeasured to an equivalent amount of the functional currency based on the applicable exchange rate in effect on the remeasurement date. Any adjustment required to remeasure a transaction to the equivalent amount of functional currency is recorded in the consolidated statements of operations of the foreign operating company as a component of foreign exchange gain or loss. |
Assets Held For Sale | Assets Held for Sale Through December 31, 2018, assets held for sale were primarily comprised of revenue equipment in the Company’s lease purchase program and recorded as a component of prepaid and other current assets on the consolidated balance sheets. Assets held for sale were not subject to depreciation, and were recorded at the lower of depreciated carrying value or fair market value less selling costs. Assets held for sale as of December 31, 2018, totaled $3.6 million, consisting of $2.7 million for the Flatbed Solutions segment and $0.9 million for the Specialized Solutions. Following the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842), the revenue equipment in the Company’s lease purchase program no longer meets the criteria for assets held for sale. See Note 2 for additional information on the adoption of ASU No. 2016-02. There were no assets held for sale as of June 30, 2019. |
Revenue and Expense Recognition | Revenue and Expense Recognition The Company’s revenue and related costs are recognized when the Company satisfies its performance obligation(s) transferring goods or services to the customer and the customer obtains control of such goods and services. With respect to freight, brokerage, logistics and fuel surcharge revenue, these conditions are met, and the Company recognizes company freight, owner operator freight, brokerage and fuel surcharge revenue, over time, and logistics revenue, as the services are provided. While the Company may enter into master service agreements with its customers, a contract is not established until the customer specifically requests the Company’s services and the Company accepts. The Company evaluates each contract for distinct performance obligations. In the Company’s business, a typical performance obligation is the transportation of a load including any highly interrelated ancillary services. The Company predominantly estimates the standalone selling price of its services based upon observable evidence, market conditions and other relevant inputs. The Company allocates the total transaction price to each distinct performance obligation based upon the relative standalone selling prices. The Company’s customers simultaneously receive and consume the benefits of the Company’s contracts; therefore, revenue is recognized over time. This is a faithful depiction of the satisfaction of the performance obligation, as the customer does not need to re-perform the transportation services the Company has provided to date. Generally, the Company’s customers are billed upon delivery of the freight or monthly and remit payment according to the approved payment terms. Freight Revenue Freight revenue is generated by hauling customer freight using company owned equipment (company freight) and owner-operator equipment (owner-operator freight). Freight revenue is the product of the number of revenue-generating miles driven and the rate per mile received from customers plus accessorial charges, such as loading and unloading freight, cargo protection, fees for detained equipment or fees for route planning and supervision. Brokerage Revenue The Company regularly engages third-party capacity providers to haul loads. The Company is primarily responsible for fulfilling the promise to provide load transportation services, and has discretion in setting prices, along with the risk to fulfill the contract to the customer. Based upon this evaluation, the Company has determined that it is the principal and therefore, records gross revenues and expenses for brokerage services. Logistics Revenue In addition to freight revenue, the Company also recognizes logistics revenue as a separate revenue stream. Logistics revenue is generated from a range of services, including value-added warehousing, loading and unloading, vehicle maintenance and repair, preparation and packaging, fuel management, and other fleet management solutions. The Company recognizes logistics revenue as services are completed. The Company has designated the following preference and practical expedients: · To not disclose remaining performance obligations when the expected performance obligation duration is one year or less. The vast majority of the Company’s services transfer control within a month of the inception of the contract with select specialized loads taking several months to allow for increased planning and permitting. · Recognize the incremental costs of obtaining or fulfilling a contract as an expense when incurred, as the amortization period of a potential asset would be recognized in one year or less. · Exclude taxes collected on behalf of government authorities from the Company’s measurement of transaction prices. Tax amounts are not included within net income or cost of sales. |
New Accounting Pronouncements | New Accounting Pronouncements In July 2017, the Financial Accounting Standards Board (FASB) issued ASU 2017-11, Earnings per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); and Derivatives and Hedging (Topic 815) . ASU 2017-11 provides guidance on accounting for financial instruments with down round features and clarifies the deferral of certain provisions in Topic 480. ASU 2017-11 will become effective for annual periods beginning after December 15, 2018 and interim periods within those periods. The Company adopted this pronouncement on January 1, 2019, which did not impact the consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Accounting for Credit Losses (Topic 326) . ASU 2016-13 requires the use of an “expected loss” model on certain types of financial instruments. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact of adopting this guidance. |
NATURE OF OPERATIONS AND SUMM_3
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Summary of changes in the fair value of the liabilities | The table below is a summary of the changes in the fair value of this liability for the six months ended June 30, 2019 and 2018 (in millions): Six Months Ended June 30, 2019 2018 Balance at beginning of period $ 21.9 $ 0.8 Fair value of earn-out liability for acquisition — 20.3 Change in fair value (0.4) (0.7) Balance at end of period $ 21.5 $ 20.4 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
LEASES | |
Schedule of components of lease expenses | The following table reflects the Company’s components of lease expenses for the three and six months ended June 30, 2019 (in millions): Three Months Ended Six Months Ended Classification June 30, 2019 Operating lease cost Revenue equipment Operations and maintenance $ 7.8 $ 13.5 Real estate Administrative expense 4.8 9.1 Total operating lease cost $ 12.6 $ 22.6 Finance lease cost Amortization of right-of-use assets Depreciation and amortization $ 1.1 $ 2.4 Interest on lease liabilities Interest expense 0.3 0.5 Total finance lease cost $ 1.4 $ 2.9 Total lease cost (a) $ 14.0 $ 25.5 (a) Short-term lease expense and variable lease expense are immaterial. |
Schedule of components of assets and liabilities for operating and finance leases | The components of assets and liabilities for operating and finance leases are as follows as of June 30, 2019 (in millions): June 30, Classification 2019 Assets Capitalized operating lease right-of-use assets Right-of-use assets $ 106.8 Finance lease right-of-use assets Other long-term assets 25.7 Total lease assets $ 132.5 Liabilities Capitalized operating lease liabilities: Current Other current liabilities $ 28.4 Non-current Other long-term liabilities 78.4 Total capitalized operating lease liabilities $ 106.8 Finance lease liabilities: Current Current portion of long-term debt $ 6.2 Non-current Long-term debt, net of current portion 19.5 Total finance lease liabilities $ 25.7 Total lease liabilities $ 132.5 |
Summary of supplemental cash flow related to leases | The following table is a summary of supplemental cash flows related to leases for the six months ended June 30, 2019 (in millions): Six Months Ended June 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from capitalized operating leases $ (17.1) Operating cash flows from finance leases (0.4) Financing cash flows from finance leases (2.8) Right-of-use assets obtained in exchange for lease obligations: Capitalized operating lease right-of-use assets $ 25.7 Finance lease right-of-use assets 9.2 |
Summary of Future payments on leases, Operating lease | The following table is the future payments on leases as of June 30, 2019 (in millions): Capitalized Operating Finance Year ending December 31, leases leases Total 2019 (1) $ 17.6 $ 4.5 $ 22.1 2020 28.6 7.6 36.2 2021 21.4 7.5 28.9 2022 16.8 4.2 21.0 2023 11.6 4.2 15.8 Thereafter 25.0 1.5 26.5 Total lease payments 121.0 29.5 150.5 Less: interest (14.2) (3.8) (18.0) Present value of lease liabilities $ 106.8 $ 25.7 $ 132.5 (1) Six months ending December 31, 2019 |
Summary of Future payments on leases, Finance lease | Capitalized Operating Finance Year ending December 31, leases leases Total 2019 (1) $ 17.6 $ 4.5 $ 22.1 2020 28.6 7.6 36.2 2021 21.4 7.5 28.9 2022 16.8 4.2 21.0 2023 11.6 4.2 15.8 Thereafter 25.0 1.5 26.5 Total lease payments 121.0 29.5 150.5 Less: interest (14.2) (3.8) (18.0) Present value of lease liabilities $ 106.8 $ 25.7 $ 132.5 |
Summary of weighted average lease term and discount rate for leases | The following table is a summary of weighted average lease terms and discount rates for leases as of June 30, 2019: 2019 Weighted-average remaining lease term (years) Capitalized operating leases 5.13 Finance leases 4.05 Weighted-average discount rate Capitalized operating leases 5.54 % Finance leases 4.39 % |
Schedule of future payments under lease agreements prior to ASC 842 adoption | The following table is the future payments under lease agreements as of December 31, 2018 prior to adoption of ASC 842 (in millions): Capital Leases Operating Leases Revenue Office Year ending December 31, Equipment and Terminals 2019 $ 5.7 $ 19.5 $ 11.9 2020 4.5 13.0 11.2 2021 4.3 5.7 9.5 2022 2.4 3.2 8.5 2023 2.9 0.3 6.6 Thereafter 0.8 — 23.0 Total minimum lease payments $ 20.6 $ 41.7 $ 70.7 Loan amount attributable to interest (2.4) Total (Present value of minimum lease payments on capital leases) 18.2 Less: current portion (4.8) Long-term capital leases $ 13.4 |
Schedule of future minimum receipts on leases | The following table is the future minimum receipts on leases as of June 30, 2019 (in millions): Twelve months ending June 30, Amount 2020 $ 26.0 2021 20.9 2022 12.9 2023 6.3 2024 2.1 Thereafter 0.1 Total minimum lease receipts $ 68.3 |
Schedule of components of the net investment in sales-type leases | The components of the net investment in sales-type leases as of December 31, 2018 prior to the adoption of ASC 842 are as follows (in millions): 2018 Minimum lease receivable $ 78.1 Deferred gain (10.1) Net minimum lease receivable 68.0 Unearned interest income (12.3) Net investment in sales-type leases 55.7 Current portion (16.2) $ 39.5 |
Schedule of future minimum lease receipts | The following table is the future minimum receipts on leases as of December 31, 2018 prior to the adoption of ASC 842 (in millions): Year ending December 31, Amount 2019 $ 16.2 2020 14.5 2021 11.0 2022 11.2 2023 2.6 Thereafter 0.2 Total $ 55.7 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Acquisition 2018 | |
Business Acquisition [Line Items] | |
Summary of the allocation of the purchase price paid to the fair values of the net assets | The following is a summary of the allocation of the purchase price paid to the fair values of the net assets, net of cash acquired, of the 2018 acquisitions (in millions): (all amounts in U.S. dollars) Leavitt's Builders Kelsey Trail Aveda Accounts receivable $ 1.9 $ 8.4 $ 2.3 $ 37.3 Parts supplies 0.1 0.3 — — Prepaid and other current assets 0.4 1.5 0.4 2.5 Property and equipment 8.5 29.4 9.2 89.8 Goodwill 5.1 14.7 3.3 7.7 Intangible assets 3.6 10.6 1.5 15.0 Other long-term assets — 0.5 — — Deferred tax liability — (9.2) (2.7) (6.7) Accounts payable and other liabilities (4.9) (19.9) (8.0) (30.0) Total consideration paid (net of cash acquired) $ 14.7 $ 36.3 $ 6.0 $ 115.6 |
PREPAID AND OTHER CURRENT ASS_2
PREPAID AND OTHER CURRENT ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
PREPAID AND OTHER CURRENT ASSETS | |
Schedule of components of prepaid expenses and other current assets | The components of prepaid expenses and other current assets are as follows as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Insurance $ 8.0 $ 7.4 Licensing, permits and tolls 6.0 5.6 Other prepaids 3.4 3.9 Other assets 2.0 4.4 Highway and fuel taxes 0.3 1.4 Assets held for sale — 3.6 $ 19.7 $ 26.3 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of changes in carrying amount of goodwill | The summary of changes in goodwill follows for the six months ended June 30, 2019 (in millions): Flatbed Specialized Total Goodwill balance at December 31, 2018 $ 101.5 $ 156.9 $ 258.4 Adjustments to previously recorded goodwill (net) — (0.3) (0.3) Foreign currency translation adjustment — 0.6 0.6 Goodwill balance at June 30, 2019 $ 101.5 $ 157.2 $ 258.7 |
Schedule of intangible assets | Intangible assets consisted of the following as of June 30, 2019 and December 31, 2018 (in millions): As of June 30, 2019 As of December 31, 2018 Intangible Accumulated Intangible Intangible Accumulated Intangible Assets Amortization Assets, net Assets Amortization Assets, net Non-competition agreements $ 33.8 $ (16.3) $ 17.5 $ 33.8 $ (12.8) $ 21.0 Customer relationships 130.9 (38.2) 92.7 130.9 (33.5) 97.4 Trade names 90.6 — 90.6 90.6 — 90.6 Foreign currency translation adjustment 0.1 — 0.1 (0.2) — (0.2) Total intangible assets $ 255.4 $ (54.5) $ 200.9 $ 255.1 $ (46.3) $ 208.8 |
Schedule of future estimated amortization expense | Future estimated amortization expense is as follows (in millions): Non-competition Customer Year ending December 31, Agreements Relationships 2019 (1) $ 3.3 $ 4.8 2020 5.4 9.5 2021 4.7 9.5 2022 3.9 9.5 2023 0.2 9.5 Thereafter — 49.9 Total $ 17.5 $ 92.7 (1) Six months ending December 31, 2019 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
PROPERTY AND EQUIPMENT. | |
Schedule of components of property and equipment | The components of property and equipment are as follows as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Revenue equipment $ 705.1 $ 734.0 Buildings and improvements 62.9 61.9 Assets leased and available for lease to owner-operators 70.3 — Furniture and fixtures, office and computer equipment and vehicles 40.3 36.5 878.6 832.4 Accumulated depreciation (298.7) (259.7) $ 579.9 $ 572.7 |
ACCRUED EXPENSES AND OTHER LI_2
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
Schedule of components of accrued expenses and other liabilities | The components of accrued expenses and other liabilities are as follows as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Brokerage and escorts $ 15.4 $ 12.6 Unvouchered payables 11.9 11.7 Other accrued expenses 10.0 8.0 Owner-operator deposits 8.8 9.3 Fuel and fuel taxes 1.8 1.2 Sales and local taxes payable 2.0 3.3 Interest 0.7 0.4 $ 50.6 $ 46.5 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
LONG-TERM DEBT. | |
Schedule of long term debt | Long-term debt consists of the following as of June 30, 2019 and December 31, 2018 (in millions): 2019 2018 Term loan facility $ 491.0 $ 493.5 Equipment term loans 197.1 190.7 Finance and capital leases 25.7 18.2 713.8 702.4 Less current portion (62.4) (63.5) Less unamortized debt issuance costs (14.9) (16.2) Total long-term debt $ 636.5 $ 622.7 |
Schedule of adjustment for margin of line of credit and senior term loan corresponding to fixed charge coverage ratio. | Fixed Charge Coverage Ratio Base Rate Margins LIBOR Rate Margins Less than 1.25 to 1.00 2.25 % 3.25 % Greater than or equal to 1.25 to 1.00, but less than 1.50 to 1.00 1.75 % 2.75 % Greater than or equal to 1.50 to 1.00, but less than 1.75 to 1.00 1.25 % 2.25 % Greater than or equal to 1.75 to 1.00 0.75 % 1.75 % |
Schedule of adjustment for margin of line of credit and senior term loan corresponding to RLOC Utilization | RLOC Utilization Base Rate Margins LIBOR Rate Margins Less than 33.3% 0.50 % 1.50 % Greater than or equal to 33.3%, but less than 66.6% 0.75 % 1.75 % Greater than or equal to 66.6% 1.00 % 2.00 % |
Future principal payments on long-term debt | Future principal payments on long-term debt as of June 30, 2019 are as follows (in millions): Twelve months ending June 30, Term Loan Facility Equipment Term Loans Total 2020 $ 5.0 $ 51.1 $ 56.1 2021 2.5 43.6 46.1 2022 2.5 36.0 38.5 2023 11.3 27.9 39.2 2024 2.5 27.6 30.1 Thereafter 467.2 10.9 478.1 Total long-term debt $ 491.0 $ 197.1 $ 688.1 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
STOCK-BASED COMPENSATION | |
Tabular disclosure of stock option grants under the Plan | The following table summarizes stock option grants under the Plan: Grantee Type # of Issued and Vesting Weighted Weighted Average Director Group 150,000 145,000 5 years $ 9.98 $ 4.36 Employee Group 2,384,094 2,268,673 5 years $ 9.22 $ 3.99 Total 2,413,673 |
Schedule of fair value assumptions of stock option grants | The fair value of the Company’s stock option grants was estimated utilizing the following assumptions for the six months ended June 30, 2019: Weighted average expected life 6.5 years Risk-free interest rate 2.55% to 2.58% Expected volatility 37.50% to 37.51% Expected dividend yield 0.00% |
Schedule of summary of option activity under the Plan and changes during the period | A summary of option activity under the Plan as of June 30, 2019 and changes during the six months then ended are as follows: Shares Weighted Weighted Aggregate Outstanding as of January 1, 2019 2,066,529 $ 10.23 8.5 $ — Granted 382,500 3.82 Forfeited or expired (35,356) 10.33 Outstanding as of June 30, 2019 2,413,673 $ 9.21 8.3 $ — Exercisable as of June 30, 2019 624,620 $ 10.28 7.8 $ — Vested and expected to vest as of June 30, 2019 2,413,673 $ 9.21 8.3 $ — |
Summary of restricted stock unit grants under the Plan | The following table summarizes restricted stock unit grants under the Plan: Grantee Type # of Issued and Outstanding Vesting Grant Date Director Group 121,212 89,700 1 year $ 5.78 Employee Group 1,568,655 535,561 5 years $ 10.59 Total 625,261 |
Summary of restricted stock awards activity under the Plan | Units Weighted Non-vested as of January 1, 2019 841,361 $ 10.44 Granted 89,700 4.32 Vested (174,296) 10.19 Forfeited (131,504) 10.51 Non-vested as of June 30, 2019 625,261 $ 9.67 |
REPORTABLE SEGMENTS (Tables)
REPORTABLE SEGMENTS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
REPORTABLE SEGMENTS | |
Schedule of tabular disclosure of financial data of the Company’s reportable segments | The following tables reflect certain financial data of the Company’s reportable segments for the three and six months ended June 30, 2019 and 2018 (in millions): Flatbed Specialized Solutions Solutions Corporate/ Consolidated Segment Segment Eliminations Total Three Months Ended June 30, 2019 Total revenue $ 174.9 $ 280.7 $ (5.0) $ 450.6 Company freight 55.0 154.5 (2.6) 206.9 Owner operator freight 73.4 49.6 (1.3) 121.7 Brokerage 25.7 47.7 (0.6) 72.8 Logistics 0.6 12.5 — 13.1 Fuel surcharge 20.2 16.4 (0.5) 36.1 Operating income (loss) 6.1 11.1 (12.5) 4.7 Depreciation 12.3 23.4 0.1 35.8 Amortization of intangible assets 1.3 2.6 — 3.9 Non-cash operating lease expense 3.1 3.5 0.1 6.7 Interest expense 2.7 3.3 6.7 12.7 Income (loss) before income tax 3.5 8.1 (18.7) (7.1) Total assets 501.5 932.4 69.1 1,503.0 Cash capital expenditures 2.3 5.4 0.5 8.2 Three Months Ended June 30, 2018 Total revenue $ 162.2 $ 218.4 $ (3.7) $ 376.9 Company freight 46.2 116.3 (2.5) 160.0 Owner operator freight 72.3 40.9 (0.6) 112.6 Brokerage 23.9 36.4 (0.2) 60.1 Logistics 0.7 8.2 — 8.9 Fuel surcharge 19.1 16.6 (0.4) 35.3 Operating income (loss) 9.3 7.1 (7.9) 8.5 Depreciation 6.7 18.8 — 25.5 Amortization of intangible assets 2.5 3.7 — 6.2 Interest expense 2.0 2.7 6.4 11.1 Income (loss) before income tax 7.4 4.6 (13.0) (1.0) Total assets 409.5 857.3 57.3 1,324.1 Cash capital expenditures 1.9 21.4 0.2 23.5 Flatbed Specialized Solutions Solutions Corporate/ Consolidated Segment Segment Eliminations Total Six Months Ended June 30, 2019 Total revenue $ 343.0 $ 550.2 $ (9.6) $ 883.6 Company freight 110.2 308.4 (5.5) 413.1 Owner operator freight 142.0 93.3 (2.6) 232.7 Brokerage 51.1 93.7 (0.6) 144.2 Logistics 1.3 24.2 — 25.5 Fuel surcharge 38.4 30.6 (0.9) 68.1 Operating income (loss) 9.4 18.8 (22.8) 5.4 Depreciation 25.4 47.4 0.2 73.0 Amortization of intangible assets 3.0 5.2 — 8.2 Non-cash operating lease expense 5.5 7.6 0.2 13.3 Interest expense 5.3 6.6 13.5 25.4 Income (loss) before income tax 4.4 13.1 (35.8) (18.3) Cash capital expenditures 2.9 8.2 1.0 12.1 Six Months Ended June 30, 2018 Total revenue $ 307.2 $ 403.3 $ (6.0) $ 704.5 Company freight 91.4 217.0 (3.8) 304.6 Owner operator freight 131.6 77.6 (1.1) 208.1 Brokerage 46.9 59.6 (0.3) 106.2 Logistics 1.4 18.3 (0.1) 19.6 Fuel surcharge 35.9 30.8 (0.7) 66.0 Operating income (loss) 16.2 12.3 (12.2) 16.3 Depreciation 13.7 35.1 — 48.8 Amortization of intangible assets 2.9 5.2 — 8.1 Interest expense 3.8 5.2 12.4 21.4 Income (loss) before income tax 12.6 8.2 (23.0) (2.2) Cash capital expenditures 2.4 28.3 0.4 31.1 |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
LOSS PER SHARE | |
Summary to reconcile basic weighted average common stock outstanding to diluted weighted average common stock outstanding | Three Months Ended Six Months Ended June 30, June 30, (in millions, except per share data) 2019 2018 2019 2018 Numerator: Net income (loss) $ (6.4) $ 13.5 $ (15.7) $ 12.7 Less Series A preferred dividends (1.3) (1.3) (2.5) (2.5) Allocation of earnings to non-vested participating restricted stock units — (0.2) — (0.2) Net income (loss) attributable to common stockholders $ (7.7) $ 12.0 $ (18.2) $ 10.0 Denominator: Weighted-average shares outstanding 64.5 59.5 64.5 56.9 Weighted average non-vested participating restricted stock units — 1.1 — 1.0 Denominator for basic and diluted EPS – weighted-average shares 64.5 60.6 64.5 57.9 Basic and diluted EPS $ (0.12) $ 0.20 $ (0.28) $ 0.17 |
NATURE OF OPERATIONS AND SUMM_4
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)segment | Jun. 30, 2018USD ($)segment | Dec. 31, 2018USD ($) | |
Deferred financing fees | $ 14,900,000 | $ 14,900,000 | $ 16,200,000 | ||
Amortization of deferred financing fees | $ 800,000 | 800,000 | $ 1,500,000 | $ 1,400,000 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Balance of contingent consideration | 21,500,000 | $ 21,500,000 | 21,900,000 | ||
Number of operating segments | segment | 16 | 16 | |||
Number of reportable segments | segment | 2 | 2 | |||
Dilutive effect | 0 | 0 | $ 0 | $ 0 | |
Assets held for sale | 0 | 0 | 3,600,000 | ||
Balance at beginning of period | 21,900,000 | 800,000 | |||
Fair value of earn-out liability for acquisition | 0 | 20,300,000 | |||
Change in fair value | (400,000) | (700,000) | |||
Balance at end of period | $ 21,500,000 | $ 20,400,000 | $ 21,500,000 | $ 20,400,000 | |
Series A | |||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Preferred stock dividend rate (as a percent) | 7.625% | 7.625% | 7.625% | 7.625% | |
Flatbed | |||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Assets held for sale | 2,700,000 | ||||
Specialized | |||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Assets held for sale | $ 900,000 |
LEASES - Adoption of New Accoun
LEASES - Adoption of New Accounting Standard (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jan. 01, 2019 | |
LEASE | ||
Right-of-use assets | $ 106.8 | |
Net lease liabilities | $ 106.8 | |
Elect the hindsight practical expedient related to lease term and impairment | true | |
Adopt the land easement practical expedient | true | |
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | |
Lessee, Finance Lease, Existence of Option to Extend [true false] | true | |
Maximum | ||
LEASE | ||
Operating lease, renewal terms | 5 years | |
Finance Lease, renewal terms | 5 years | |
Maximum | Revenue equipment | ||
LEASE | ||
Operating lease, initial terms | 9 years | |
Finance Lease, initial terms | 9 years | |
Maximum | Real estate | ||
LEASE | ||
Operating lease, initial terms | 15 years | |
Finance Lease, initial terms | 15 years | |
Minimum | ||
LEASE | ||
Operating lease, renewal terms | 1 year | |
Finance Lease, renewal terms | 1 year | |
Minimum | Revenue equipment | ||
LEASE | ||
Operating lease, initial terms | 3 years | |
Finance Lease, initial terms | 3 years | |
Minimum | Real estate | ||
LEASE | ||
Operating lease, initial terms | 3 years | |
Finance Lease, initial terms | 3 years | |
Accounting Standards Update 2016-02 | ||
LEASE | ||
Right-of-use assets | $ 96.9 | |
Net lease liabilities | $ 96.9 |
LEASES - Components of lease ex
LEASES - Components of lease expenses (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
LEASE | ||
Capitalized operating lease rental expense | $ 12.6 | $ 22.6 |
Interest on lease liabilities | 0.4 | |
Total finance lease cost | 1.4 | 2.9 |
Total lease expense | 14 | 25.5 |
Operations and maintenance | Revenue equipment | ||
LEASE | ||
Capitalized operating lease rental expense | 7.8 | 13.5 |
Salaries, wages and employee benefits | Real estate | ||
LEASE | ||
Capitalized operating lease rental expense | 4.8 | 9.1 |
Depreciation and amortization | ||
LEASE | ||
Amortization right-of-use assets | 1.1 | 2.4 |
Interest Expense | ||
LEASE | ||
Interest on lease liabilities | $ 0.3 | $ 0.5 |
LEASES - Components of assets a
LEASES - Components of assets and liabilities (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Components of assets and liabilities for operating and finance leases | |
Right-of-use assets | $ 106.8 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Right-of-use assets |
Finance lease right-of-use assets | $ 25.7 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets, Noncurrent |
Total lease assets | $ 132.5 |
Current | $ 28.4 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other Liabilities, Current |
Non-current | $ 78.4 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other Liabilities, Noncurrent |
Present value of lease liabilities | $ 106.8 |
Current | $ 6.2 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Long-term Debt, Current Maturities |
Non-current | $ 19.5 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | dske:LongTermDebtNoncurrent |
Total finance lease liabilities | $ 25.7 |
Total lease liabilities | 132.5 |
Operating cash flows from capitalized operating leases | (17.1) |
Operating cash flows from finance leases | (0.4) |
Financing cash flows from finance leases | (2.8) |
Capitalized operating lease right-of-use assets | 25.7 |
Finance lease right-of-use assets | $ 9.2 |
LEASES - Future payments on lea
LEASES - Future payments on leases (Details) $ in Millions | Jun. 30, 2019USD ($) |
Capitalized Operating Leases | |
2019 | $ 17.6 |
2020 | 28.6 |
2021 | 21.4 |
2022 | 16.8 |
2023 | 11.6 |
Thereafter | 25 |
Total lease payments | 121 |
Less: interest | (14.2) |
Present value of lease liabilities | 106.8 |
Finance Lease | |
2019 | 4.5 |
2020 | 7.6 |
2021 | 7.5 |
2022 | 4.2 |
2023 | 4.2 |
Thereafter | 1.5 |
Total lease payments | 29.5 |
Less: interest | (3.8) |
Present value of lease liabilities | 25.7 |
Total Lease | |
2019 | 22.1 |
2020 | 36.2 |
2021 | 28.9 |
2022 | 21 |
2023 | 15.8 |
Thereafter | 26.5 |
Total lease payments | 150.5 |
Less: interest | (18) |
Present value of lease liabilities | $ 132.5 |
LEASES - Weighted average lease
LEASES - Weighted average lease term and discount rate (Details) | Jun. 30, 2019 |
LEASES | |
Capitalized operating leases | 5 years 1 month 17 days |
Finance leases | 4 years 18 days |
Capitalized operating leases | 5.54% |
Finance leases | 4.39% |
LEASES - Future payments under
LEASES - Future payments under lease agreements prior to ASC 842 adoption (Details) $ in Millions | Dec. 31, 2018USD ($) |
Capital Leases | |
2019 | $ 5.7 |
2020 | 4.5 |
2021 | 4.3 |
2022 | 2.4 |
2023 | 2.9 |
Thereafter | 0.8 |
Total minimum lease payments | 20.6 |
Loan amount attributable to interest | (2.4) |
Total (Present value of minimum lease payments on capital leases) | 18.2 |
Less current portion | (4.8) |
Long-term capital leases | 13.4 |
Revenue Equipment | |
Operating Leases | |
2019 | 19.5 |
2020 | 13 |
2021 | 5.7 |
2022 | 3.2 |
2023 | 0.3 |
Total minimum lease payments | 41.7 |
Office and Terminals | |
Operating Leases | |
2019 | 11.9 |
2020 | 11.2 |
2021 | 9.5 |
2022 | 8.5 |
2023 | 6.6 |
Thereafter | 23 |
Total minimum lease payments | $ 70.7 |
LEASES - Lessor (Details)
LEASES - Lessor (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Lessor, Lease, Description [Line Items] | |||||
Property and equipment | $ 878.6 | $ 878.6 | $ 832.4 | ||
Net investment in sales-type leases | 55.7 | ||||
Prepaid and other current assets | 19.7 | 19.7 | $ 26.3 | ||
Depreciation | 35.8 | $ 25.5 | 73 | $ 48.8 | |
Lease income | $ 6.1 | $ 11.6 | |||
Minimum | |||||
Lessor, Lease, Description [Line Items] | |||||
Terms | 30 months | 30 months | |||
Maximum | |||||
Lessor, Lease, Description [Line Items] | |||||
Terms | 72 months | 72 months | |||
Asset Leased Under Operating Leases | |||||
Lessor, Lease, Description [Line Items] | |||||
Depreciation | $ 3.9 | $ 8.8 | |||
Accounting Standards Update 2016-02 | |||||
Lessor, Lease, Description [Line Items] | |||||
Property and equipment | 59.4 | 59.4 | |||
Net investment in sales-type leases | 55.8 | 55.8 | |||
Prepaid and other current assets | $ 3.6 | $ 3.6 |
LEASES - Future Minimum Lease R
LEASES - Future Minimum Lease Receipts (Details) $ in Millions | Jun. 30, 2019USD ($) |
Future minimum receipts | |
2020 | $ 26 |
2021 | 20.9 |
2022 | 12.9 |
2023 | 6.3 |
2024 | 2.1 |
Thereafter | 0.1 |
Total minimum lease receipts | $ 68.3 |
LEASES - Prior To Adoption Of A
LEASES - Prior To Adoption Of ASC 842 (Details) $ in Millions | Dec. 31, 2018USD ($) |
Sales-type Lease, Net Investment in Lease [Abstract] | |
Minimum lease receivable | $ 78.1 |
Deferred gain | (10.1) |
Net minimum lease receivable | 68 |
Unearned interest income | (12.3) |
Net investment in sales-type leases | 55.7 |
Current portion | (16.2) |
Capital Leases, Lessor Balance Sheet, Net Investment in Sales Type Leases, Current | 16.2 |
Non-current portion | 39.5 |
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | |
2019 | 16.2 |
2020 | 14.5 |
2021 | 11 |
2022 | 11.2 |
2023 | 2.6 |
Thereafter | 0.2 |
Total | $ 55.7 |
ACQUISITIONS (Details)
ACQUISITIONS (Details) $ in Millions | Aug. 01, 2018USD ($)shares | Jul. 01, 2018USD ($)shares | Jun. 06, 2018USD ($)shares | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($)item | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Jun. 06, 2018$ / shares | Jun. 06, 2018USD ($) |
ACQUISITIONS | ||||||||||||
Common stock issued in acquisitions | $ 15.4 | $ 15.4 | ||||||||||
Revenue | $ 450.6 | 376.9 | $ 883.6 | 704.5 | ||||||||
Net income (loss) | (6.4) | $ (9.3) | 13.5 | $ (0.8) | (15.7) | 12.7 | ||||||
Allocation of the purchase price paid to the fair values of the net assets | ||||||||||||
Prepaid and other current assets | 19.7 | 19.7 | $ 26.3 | |||||||||
Property and equipment | 878.6 | 878.6 | 832.4 | |||||||||
Goodwill | 258.7 | 258.7 | 258.4 | |||||||||
Amortization of intangible assets | 3.9 | $ 6.2 | 8.2 | $ 8.1 | ||||||||
Accumulated amortization | 54.5 | 54.5 | 46.3 | |||||||||
Non-compete agreements | ||||||||||||
Allocation of the purchase price paid to the fair values of the net assets | ||||||||||||
Accumulated amortization | 16.3 | 16.3 | 12.8 | |||||||||
Customer relationships | ||||||||||||
Allocation of the purchase price paid to the fair values of the net assets | ||||||||||||
Accumulated amortization | 38.2 | $ 38.2 | $ 33.5 | |||||||||
Minimum | ||||||||||||
ACQUISITIONS | ||||||||||||
Number of open-deck trucking companies acquired | item | 20 | |||||||||||
Builders | ||||||||||||
ACQUISITIONS | ||||||||||||
Voting interest acquired (as a percent) | 100.00% | |||||||||||
Total consideration paid | $ 36.3 | |||||||||||
Cash payments for business consideration | $ 30 | |||||||||||
Number of shares transferred | shares | 399,530 | |||||||||||
Common stock issued in acquisitions | $ 3.4 | |||||||||||
Outstanding debt assumed | 2.9 | |||||||||||
Allocation of the purchase price paid to the fair values of the net assets | ||||||||||||
Accounts receivable | 8.4 | $ 8.4 | ||||||||||
Parts supplies | 0.3 | 0.3 | ||||||||||
Prepaid and other current assets | 1.5 | 1.5 | ||||||||||
Property and equipment | 29.4 | 29.4 | ||||||||||
Goodwill | 14.7 | 14.7 | ||||||||||
Intangible assets | 10.6 | 10.6 | ||||||||||
Other long-term assets | 0.5 | 0.5 | ||||||||||
Deferred tax liability | (9.2) | (9.2) | ||||||||||
Accounts payable and other liabilities | (19.9) | (19.9) | ||||||||||
Total | 36.3 | 36.3 | ||||||||||
Transaction expenses incurred, not deductible for taxes purposes | $ 0.2 | |||||||||||
Aveda | ||||||||||||
ACQUISITIONS | ||||||||||||
Total consideration paid | $ 118.7 | |||||||||||
Cash payments for business consideration | $ 27.3 | |||||||||||
Number of shares transferred | shares | 1,612,979 | |||||||||||
Common stock issued in acquisitions | $ 15.4 | |||||||||||
Contingent liability | 21.2 | |||||||||||
Outstanding debt assumed | $ 54.8 | |||||||||||
Allocation of the purchase price paid to the fair values of the net assets | ||||||||||||
Accounts receivable | 37.3 | 37.3 | ||||||||||
Prepaid and other current assets | 2.5 | 2.5 | ||||||||||
Property and equipment | 89.8 | 89.8 | ||||||||||
Goodwill | 7.7 | 7.7 | ||||||||||
Intangible assets | 15 | 15 | ||||||||||
Deferred tax liability | (6.7) | (6.7) | ||||||||||
Accounts payable and other liabilities | (30) | (30) | ||||||||||
Total | 115.6 | 115.6 | ||||||||||
Cash per common share | $ / shares | $ 0.45 | |||||||||||
Transaction expenses incurred, not deductible for taxes purposes | $ 1.1 | |||||||||||
Increase (decrease) in goodwill | 0.7 | |||||||||||
Increase decrease in deferred tax liability | 0.7 | |||||||||||
Kelsey Trail | ||||||||||||
ACQUISITIONS | ||||||||||||
Voting interest acquired (as a percent) | 100.00% | |||||||||||
Total consideration paid | $ 6.2 | |||||||||||
Cash payments for business consideration | $ 5.3 | |||||||||||
Number of shares transferred | shares | 95,859 | |||||||||||
Common stock issued in acquisitions | $ 0.9 | |||||||||||
Allocation of the purchase price paid to the fair values of the net assets | ||||||||||||
Accounts receivable | 2.3 | 2.3 | ||||||||||
Prepaid and other current assets | 0.4 | 0.4 | ||||||||||
Property and equipment | 9.2 | 9.2 | ||||||||||
Goodwill | 3.3 | 3.3 | ||||||||||
Intangible assets | 1.5 | 1.5 | ||||||||||
Deferred tax liability | (2.7) | (2.7) | ||||||||||
Accounts payable and other liabilities | (8) | (8) | ||||||||||
Total | 6 | 6 | ||||||||||
Transaction expenses incurred, not deductible for taxes purposes | $ 0.1 | |||||||||||
Increase (decrease) in goodwill | (0.9) | |||||||||||
Increase decrease in deferred tax liability | $ (0.9) | |||||||||||
Leavitts Freight Service [Member] | ||||||||||||
ACQUISITIONS | ||||||||||||
Voting interest acquired (as a percent) | 100.00% | |||||||||||
Total consideration paid | $ 14.9 | |||||||||||
Allocation of the purchase price paid to the fair values of the net assets | ||||||||||||
Accounts receivable | 1.9 | 1.9 | ||||||||||
Parts supplies | 0.1 | 0.1 | ||||||||||
Prepaid and other current assets | 0.4 | 0.4 | ||||||||||
Property and equipment | 8.5 | 8.5 | ||||||||||
Goodwill | 5.1 | 5.1 | ||||||||||
Intangible assets | 3.6 | 3.6 | ||||||||||
Accounts payable and other liabilities | (4.9) | (4.9) | ||||||||||
Total | $ 14.7 | $ 14.7 | ||||||||||
Transaction expenses incurred, not deductible for taxes purposes | $ 0.3 |
PREPAID AND OTHER CURRENT ASS_3
PREPAID AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
PREPAID AND OTHER CURRENT ASSETS | ||
Insurance | $ 8 | $ 7.4 |
Licensing, permits and tolls | 6 | 5.6 |
Other prepaids | 3.4 | 3.9 |
Other assets | 2 | 4.4 |
Highway and fuel taxes | 0.3 | 1.4 |
Assets held for sale | 0 | 3.6 |
Total | $ 19.7 | $ 26.3 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
Goodwill | ||
Balance at the beginning of the period | $ 258.4 | |
Goodwill impairment | $ 0 | 0 |
Goodwill acquired and adjustments to previously recorded goodwill (net) | (0.3) | |
Foreign currency translation adjustment | 0.6 | |
Balance at the end of the period | 258.7 | 258.7 |
Flatbed | ||
Goodwill | ||
Balance at the beginning of the period | 101.5 | |
Balance at the end of the period | 101.5 | 101.5 |
Specialized | ||
Goodwill | ||
Balance at the beginning of the period | 156.9 | |
Goodwill acquired and adjustments to previously recorded goodwill (net) | (0.3) | |
Foreign currency translation adjustment | 0.6 | |
Balance at the end of the period | $ 157.2 | $ 157.2 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Other Intangibles (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Intangible Assets, Net | |||||
Intangible Assets | $ 255.4 | $ 255.4 | $ 255.1 | ||
Accumulated Amortization | (54.5) | (54.5) | (46.3) | ||
Intangible Assets, net | 200.9 | 200.9 | 208.8 | ||
Foreign currency translation adjustment, Intangible asset, Gross | 0.1 | 0.1 | (0.2) | ||
Foreign currency translation adjustment, Intangible asset, net | 0.1 | 0.1 | (0.2) | ||
Amortization of intangible assets | 3.9 | $ 6.2 | 8.2 | $ 8.1 | |
Trade names | |||||
Indefinite-Lived Intangible Assets (Excluding Goodwill) [Abstract] | |||||
Indefinite lived intangible assets | 90.6 | ||||
Intangible Assets, Net | |||||
Intangible Assets | 90.6 | 90.6 | |||
Intangible Assets, net | 90.6 | 90.6 | 90.6 | ||
Non-compete agreements | |||||
Intangible Assets, Net | |||||
Intangible Assets | 33.8 | 33.8 | 33.8 | ||
Accumulated Amortization | (16.3) | (16.3) | (12.8) | ||
Intangible Assets, net | 17.5 | $ 17.5 | 21 | ||
Weighted average remaining useful lives | 2 years 6 months | ||||
Future estimated amortization expense | |||||
2019 | 3.3 | $ 3.3 | |||
2020 | 5.4 | 5.4 | |||
2021 | 4.7 | 4.7 | |||
2022 | 3.9 | 3.9 | |||
2023 | 0.2 | 0.2 | |||
Total | 17.5 | 17.5 | |||
Customer relationships | |||||
Intangible Assets, Net | |||||
Intangible Assets | 130.9 | 130.9 | 130.9 | ||
Accumulated Amortization | (38.2) | (38.2) | (33.5) | ||
Intangible Assets, net | 92.7 | $ 92.7 | $ 97.4 | ||
Weighted average remaining useful lives | 9 years 10 months 24 days | ||||
Future estimated amortization expense | |||||
2019 | 4.8 | $ 4.8 | |||
2020 | 9.5 | 9.5 | |||
2021 | 9.5 | 9.5 | |||
2022 | 9.5 | 9.5 | |||
2023 | 9.5 | 9.5 | |||
Thereafter | 49.9 | 49.9 | |||
Total | $ 92.7 | $ 92.7 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
PROPERTY AND EQUIPMENT | |||||
Property and equipment, Gross | $ 878.6 | $ 878.6 | $ 832.4 | ||
Accumulated depreciation | (298.7) | (298.7) | (259.7) | ||
Property and equipment, Net | 579.9 | 579.9 | 572.7 | ||
Depreciation | 35.8 | $ 25.5 | 73 | $ 48.8 | |
Revenue equipment | |||||
PROPERTY AND EQUIPMENT | |||||
Property and equipment, Gross | 705.1 | 705.1 | 734 | ||
Buildings and improvements | |||||
PROPERTY AND EQUIPMENT | |||||
Property and equipment, Gross | 62.9 | 62.9 | 61.9 | ||
Assets leased and available for lease to owner operators | |||||
PROPERTY AND EQUIPMENT | |||||
Property and equipment, Gross | 70.3 | 70.3 | |||
Accumulated depreciation | (10.7) | (10.7) | |||
Depreciation | 5.1 | 5.1 | |||
Furniture and fixtures, office and computer equipment and vehicles | |||||
PROPERTY AND EQUIPMENT | |||||
Property and equipment, Gross | 40.3 | 40.3 | $ 36.5 | ||
Property and equipment | |||||
PROPERTY AND EQUIPMENT | |||||
Depreciation | 30.8 | 25.5 | 62.3 | 48.8 | |
Acquired Assets [Member] | |||||
PROPERTY AND EQUIPMENT | |||||
Depreciation | $ 5.9 | $ 5.4 | $ 12.7 | $ 9.5 |
ACCRUED EXPENSES AND OTHER LI_3
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
ACCRUED EXPENSES AND OTHER LIABILITIES | ||
Brokerage and escorts | $ 15.4 | $ 12.6 |
Unvouchered payables | 11.9 | 11.7 |
Other accrued expenses | 10 | 8 |
Owner operator deposits | 8.8 | 9.3 |
Fuel and fuel taxes | 1.8 | 1.2 |
Sales and local taxes payable | 2 | 3.3 |
Interest | 0.7 | 0.4 |
Total | $ 50.6 | $ 46.5 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Senior Debt | ||
Long-term Debt, Gross | $ 713.8 | $ 702.4 |
Less current portion | (62.4) | (63.5) |
Long-term portion | 636.5 | 622.7 |
Total | 688.1 | |
Term loan facility | ||
Senior Debt | ||
Total | 491 | |
Senior Debt | ||
Senior Debt | ||
Less current portion | (62.4) | (63.5) |
Less unamortized debt issuance costs | (14.9) | (16.2) |
Senior Debt | Term loan facility | ||
Senior Debt | ||
Long-term Debt, Gross | 491 | 493.5 |
Equipment term loans | ||
Senior Debt | ||
Long-term Debt, Gross | 197.1 | 190.7 |
Total | 197.1 | |
Capital leases | ||
Senior Debt | ||
Long-term Debt, Gross | $ 25.7 | $ 18.2 |
LONG-TERM DEBT - ABL Facility (
LONG-TERM DEBT - ABL Facility (Details) - USD ($) $ in Millions | Jun. 15, 2018 | Aug. 31, 2017 | Feb. 27, 2017 | Jun. 30, 2019 |
Senior term loan | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio Trailing Period | 12 months | |||
RLOC Utilization trailing period (in months) | 12 months | |||
Equipment term loans | Maximum | ||||
LONG-TERM DEBT | ||||
Interest rate (as a percent) | 10.70% | |||
Equipment term loans | Minimum | ||||
LONG-TERM DEBT | ||||
Interest rate (as a percent) | 1.50% | |||
Term loan facility | Credit Suisse AG | ||||
LONG-TERM DEBT | ||||
Percentage of EBITDA permitted to be added back (as a percent) | 25.00% | |||
Percentage of excess cash flow, mandatory prepayment, 2019 | 50.00% | |||
Percentage of excess cash flow, mandatory prepayment, 2020 | 25.00% | |||
Percentage of excess cash flow, mandatory prepayment, 2021 | 0.00% | |||
Term loan facility | Credit Suisse AG | Commencing March 31 2018 | ||||
LONG-TERM DEBT | ||||
Consolidated total leverage ratio commencing on March 31, 2018 | 4.00% | |||
Term loan facility | Credit Suisse AG | Commencing March 31 2021 | ||||
LONG-TERM DEBT | ||||
Consolidated total leverage ratio commencing on March 31, 2021 | 3.75% | |||
Term loan facility | Credit Suisse AG | Base Rate | ||||
LONG-TERM DEBT | ||||
Floor rate (as a percent) | 2.00% | |||
Basis spread on variable rate | 4.00% | |||
Term loan facility | Credit Suisse AG | LIBOR | ||||
LONG-TERM DEBT | ||||
Floor rate (as a percent) | 1.00% | |||
Basis spread on variable rate | 5.00% | |||
Term loan facility | Senior Debt | Credit Suisse AG | ||||
LONG-TERM DEBT | ||||
Credit facility | $ 500 | |||
Average interest rate on term loan | 7.50% | |||
ABL Member | ||||
LONG-TERM DEBT | ||||
Availability at closing | $ 85.2 | |||
Excess availability falling below amount | $ 15 | |||
Maximum credit amount (as a percent) | 20.00% | |||
Number of consecutive days, a financial covenant requiring the Company to maintain a minimum consolidated fixed charge coverage ratio | 60 days | |||
Minimum consolidated fixed charge coverage ratio | 1.00% | |||
ABL Member | Commencing March 31 2018 | ||||
LONG-TERM DEBT | ||||
Consolidated total leverage ratio commencing on March 31, 2018 | 4.00% | |||
ABL Member | Commencing March 31 2021 | ||||
LONG-TERM DEBT | ||||
Consolidated total leverage ratio commencing on March 31, 2021 | 3.75% | |||
ABL Member | PNC Bank National Association | ||||
LONG-TERM DEBT | ||||
Credit facility | $ 100 | |||
Term loan amortization period | 5 years | |||
Percentage of accounts receivable used as part of the borrowing base calculation | 85.00% | |||
Percentage of unbilled accounts receivable used as part of the borrowing base calculation | 80.00% | |||
Percentage of parts supplies used as part of the borrowing base calculation | 50.00% | |||
Facility's maximum credit amount | $ 30 | |||
Line of credit sublimit | $ 20 | |||
Outstanding letters of credit | $ 0.3 | |||
Interest rate (as a percent) | 6.00% | |||
ABL Member | Letter of credit | ||||
LONG-TERM DEBT | ||||
Outstanding letters of credit | $ 13.9 | |||
Revolving credit facility | PNC Bank National Association | Base Rate | Less than 1.25 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 2.25% | |||
Revolving credit facility | PNC Bank National Association | Base Rate | Greater than or equal to 1.25 to 1.00, but less than 1.50 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 1.75% | |||
Revolving credit facility | PNC Bank National Association | Base Rate | Greater than or equal to 1.50 to 1.00, but less than 1.75 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 1.25% | |||
Revolving credit facility | PNC Bank National Association | Base Rate | Greater than or equal to 1.75 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 0.75% | |||
Revolving credit facility | PNC Bank National Association | Base Rate | Less than 33.3% | ||||
LONG-TERM DEBT | ||||
Basis spread on variable rate | 0.50% | |||
Revolving credit facility | PNC Bank National Association | Base Rate | Greater than or equal to 33.3%, but less than 66.6% | ||||
LONG-TERM DEBT | ||||
Basis spread on variable rate | 0.75% | |||
Revolving credit facility | PNC Bank National Association | Base Rate | Greater than or equal to 66.6% | ||||
LONG-TERM DEBT | ||||
Basis spread on variable rate | 1.00% | |||
Revolving credit facility | PNC Bank National Association | LIBOR | Less than 1.25 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 3.25% | |||
Revolving credit facility | PNC Bank National Association | LIBOR | Greater than or equal to 1.25 to 1.00, but less than 1.50 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 2.75% | |||
Revolving credit facility | PNC Bank National Association | LIBOR | Greater than or equal to 1.50 to 1.00, but less than 1.75 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 2.25% | |||
Revolving credit facility | PNC Bank National Association | LIBOR | Greater than or equal to 1.75 to 1.00 | ||||
LONG-TERM DEBT | ||||
Fixed charge coverage ratio | 1.75% | |||
Revolving credit facility | PNC Bank National Association | LIBOR | Less than 33.3% | ||||
LONG-TERM DEBT | ||||
Basis spread on variable rate | 1.50% | |||
Revolving credit facility | PNC Bank National Association | LIBOR | Greater than or equal to 33.3%, but less than 66.6% | ||||
LONG-TERM DEBT | ||||
Basis spread on variable rate | 1.75% | |||
Revolving credit facility | PNC Bank National Association | LIBOR | Greater than or equal to 66.6% | ||||
LONG-TERM DEBT | ||||
Basis spread on variable rate | 2.00% |
LONG-TERM DEBT - Equipment Term
LONG-TERM DEBT - Equipment Term Loans and Mortgages (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)Lender | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
LONG-TERM DEBT | ||||
Loan balance | $ 713,800,000 | $ 702,400,000 | ||
Book value recorded under capital leases | 16,600,000 | |||
Accumulated depreciation | 7,800,000 | |||
Depreciation expense leased equipment | $ 700,000 | $ 1,300,000 | ||
Equipment term loans | ||||
LONG-TERM DEBT | ||||
Equipment with collateralizes term loans | 193,700,000 | |||
Loan balance | $ 197,100,000 | $ 190,700,000 | ||
Number of lenders | Lender | 41 | |||
Equipment term loans | Minimum | ||||
LONG-TERM DEBT | ||||
Interest rate (as a percent) | 1.50% | |||
Equipment term loans | Maximum | ||||
LONG-TERM DEBT | ||||
Interest rate (as a percent) | 10.70% | |||
Bank mortgage loan | ||||
LONG-TERM DEBT | ||||
Interest rate (as a percent) | 3.70% | |||
Loan amount | $ 3,400,000 | |||
Monthly installments | $ 15,776 | |||
November 1 2020 | Equipment term loans | ||||
LONG-TERM DEBT | ||||
Number of days of adjustment of interest rate and monthly payments | 45 days | |||
November 1 2020 | Equipment term loans | Base Rate | ||||
LONG-TERM DEBT | ||||
Interest rate (as a percent) | 2.50% | |||
November 1 2020 | Equipment term loans | Minimum | ||||
LONG-TERM DEBT | ||||
Interest rate (as a percent) | 3.70% |
LONG-TERM DEBT - Additional inf
LONG-TERM DEBT - Additional information (Details) $ in Millions | Jun. 30, 2019USD ($) |
Long-term Debt and Capital Lease Obligations, Including Current Maturities [Abstract] | |
2020 | $ 56.1 |
2021 | 46.1 |
2022 | 38.5 |
2023 | 39.2 |
2024 | 30.1 |
Thereafter | 478.1 |
Total | 688.1 |
Equipment term loans | |
Long-term Debt and Capital Lease Obligations, Including Current Maturities [Abstract] | |
2020 | 51.1 |
2021 | 43.6 |
2022 | 36 |
2023 | 27.9 |
2024 | 27.6 |
Thereafter | 10.9 |
Total | 197.1 |
Term loan facility | |
Long-term Debt and Capital Lease Obligations, Including Current Maturities [Abstract] | |
2020 | 5 |
2021 | 2.5 |
2022 | 2.5 |
2023 | 11.3 |
2024 | 2.5 |
Thereafter | 467.2 |
Total | $ 491 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Effective tax rate | 9.90% | 1371.00% | 14.20% | 666.20% |
Uncertain tax positions | $ 0 | $ 0 | ||
Minimum | ||||
State tax rates | 1.00% | |||
Maximum | ||||
State tax rates | 6.00% |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) $ / shares in Units, $ in Millions | Jun. 15, 2019$ / shares | May 21, 2019$ / shares | Mar. 15, 2019$ / shares | Feb. 27, 2019$ / shares | Aug. 01, 2018USD ($)shares | Jul. 01, 2018USD ($)shares | Jun. 20, 2018$ / shares | Jun. 06, 2018USD ($)shares | Jun. 01, 2018$ / sharesshares | May 22, 2018$ / shares | Mar. 15, 2018$ / shares | Feb. 27, 2018$ / shares | Feb. 16, 2018shares | Feb. 14, 2018USD ($)$ / sharesshares | Jun. 30, 2019Vote$ / sharesshares | Jun. 30, 2018USD ($)$ / shares | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($)DVote$ / sharesshares | Jun. 30, 2018USD ($)$ / shares | Dec. 31, 2018$ / shares |
Number of votes for each common stock | Vote | 1 | 1 | ||||||||||||||||||
Issuance of common stock (in shares) | 7,500,000 | |||||||||||||||||||
Issuance of stock | $ | $ 15.4 | $ 84.5 | ||||||||||||||||||
Proceeds from issuance of common stock | $ | $ 84.4 | $ 84.6 | ||||||||||||||||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||||||||||||
Purchase price paid in common stock (in value) | $ | $ 15.4 | $ 15.4 | ||||||||||||||||||
2017 Omnibus Incentive Plan | ||||||||||||||||||||
Shares of common stock reserved for future issuance | 1,200,000 | 1,200,000 | ||||||||||||||||||
Warrants | ||||||||||||||||||||
Total number of warrants outstanding | 35,040,658 | 35,040,658 | ||||||||||||||||||
Share issued for exercise of warrants (in shares) | 17,520,329 | 17,520,329 | ||||||||||||||||||
Shares that can be purchased out of each warrant | 0.50 | 0.50 | ||||||||||||||||||
Exercise price per half share (in dollars per share) | $ / shares | $ 5.75 | |||||||||||||||||||
Exercise price per whole share (in dollars per share) | $ / shares | $ 11.50 | $ 11.50 | ||||||||||||||||||
Number of fractional shares to be issued | 0 | |||||||||||||||||||
Expiration term of public warrants | 5 years | |||||||||||||||||||
Public Warrants | ||||||||||||||||||||
Total number of warrants outstanding | 19,959,902 | 19,959,902 | ||||||||||||||||||
Redemption price per warrant | $ / shares | $ 0.01 | |||||||||||||||||||
Redemption price per warrant subject to stated common stock value | $ / shares | $ 24 | |||||||||||||||||||
Number of trading days in which the price per share should equals or exceeds $24.00 per share to call the Public Warrants for redemption | D | 20 | |||||||||||||||||||
Warrants exercisable period | 30 days | |||||||||||||||||||
Private Placement Warrants | ||||||||||||||||||||
Total number of warrants outstanding | 15,080,756 | 15,080,756 | ||||||||||||||||||
Aveda | ||||||||||||||||||||
Purchase price paid in common stock (in shares) | 1,612,979 | |||||||||||||||||||
Purchase price paid in common stock (in value) | $ | $ 15.4 | |||||||||||||||||||
Kelsey Trail | ||||||||||||||||||||
Purchase price paid in common stock (in shares) | 95,859 | |||||||||||||||||||
Purchase price paid in common stock (in value) | $ | $ 0.9 | |||||||||||||||||||
Builders | ||||||||||||||||||||
Purchase price paid in common stock (in shares) | 399,530 | |||||||||||||||||||
Purchase price paid in common stock (in value) | $ | $ 3.4 | |||||||||||||||||||
Selling Stockholders | ||||||||||||||||||||
Selling price to public | $ / shares | $ 10.60 | |||||||||||||||||||
Underwriting agreement | ||||||||||||||||||||
Issuance of common stock (in shares) | 1,125,000 | |||||||||||||||||||
Duration to purchase additional shares | 30 days | |||||||||||||||||||
Series A | ||||||||||||||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||||||||||||||||
Number of shares of the company's stock issued upon initial conversion | 8.6957 | 8.6957 | ||||||||||||||||||
Initial conversion rate per share (in dollars per share) | $ / shares | $ 11.50 | $ 11.50 | ||||||||||||||||||
Number of years of anniversary from issue date for holder elects to convert (in years) | 7 years | |||||||||||||||||||
Number of consecutive trading days at option by delivery of Notice of Conversion (in days) | 10 days | |||||||||||||||||||
Number of consecutive trading days commencing on trading day immediately following notice (in days) | 20 days | |||||||||||||||||||
Shares would be issuable upon conversion of currently outstanding shares (in shares) | 5,652,173 | |||||||||||||||||||
Minimum percentage of weighted average price of common stock under preferred stock conversion on or after third anniversary (as a percent) | 140.00% | |||||||||||||||||||
Minimum trading days of weighted average price of common stock under preferred stock conversion on or after third anniversary (in days) | 20 days | |||||||||||||||||||
Maximum trading days of weighted average price of common stock under preferred stock conversion on or after third anniversary (in days) | 30 days | |||||||||||||||||||
Minimum percentage of weighted average price of common stock under preferred stock conversion on or after fifth anniversary (as a percent) | 115.00% | |||||||||||||||||||
Minimum trading days of weighted average price of common stock under preferred stock conversion on or after fifth anniversary (in days) | 20 days | |||||||||||||||||||
Maximum trading days of weighted average price of common stock under preferred stock conversion on or after fifth anniversary (in days) | 30 days | |||||||||||||||||||
Minimum trading days of weighted average price of common stock under preferred stock conversion on or after seventh anniversary (in days) | 10 days | |||||||||||||||||||
Maximum days for conversion of preferred stock into common stock due to fundamental changes (in days) | 15 days | |||||||||||||||||||
Base price for calculation of conversion rate | $ / shares | $ 100 | |||||||||||||||||||
Percentage of closing sale price of common stock | 66.67% | 66.67% | ||||||||||||||||||
Minimum percentage of shares of common stock owned by holder for limitation in preferred stock | 9.99% | |||||||||||||||||||
Maximum percentage of shares can be converted to common stock | 19.99% | |||||||||||||||||||
Preferred share liquidation amount per share | $ / shares | $ 100 | $ 100 | ||||||||||||||||||
Dividend rate (as a percent) | 7.625% | 7.625% | 7.625% | 7.625% | ||||||||||||||||
Preferred stock, quarterly dividend declared (in dollars per share) | $ / shares | $ 1.91 | $ 1.91 | $ 1.91 | $ 1.91 | $ 1.91 | $ 1.91 | $ 3.81 | $ 3.81 | ||||||||||||
Dividend paid (in dollars per share) | $ / shares | $ 1.91 | $ 1.91 | $ 1.91 | $ 1.91 | ||||||||||||||||
Series A | Maximum | ||||||||||||||||||||
Number of business days following tenth consecutive trading day to convert shares (in days) | 5 days | |||||||||||||||||||
Number of trading days from receipt of Notice of Conversion (in days) | 2 days | |||||||||||||||||||
Series A | Hennessy Capital Acquisition Corp II and HCAC Merger Sub Inc | ||||||||||||||||||||
Preferred stock, issued (in shares) | 650,000 | 650,000 | ||||||||||||||||||
Proceeds from convertible preferred stock | $ | $ 65 | |||||||||||||||||||
Earn out provision | Hennessy Capital Acquisition Corp II and HCAC Merger Sub Inc | ||||||||||||||||||||
Common stock, par value | $ / shares | $ 0.0001 | |||||||||||||||||||
Purchase price paid in common stock (in shares) | 5,000,000 |
STOCK-BASED COMPENSATION Option
STOCK-BASED COMPENSATION Options (Details) - USD ($) | 6 Months Ended | 25 Months Ended | 28 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Feb. 27, 2017 | |
Director Group | |||||
Stock option grants under the Plan | |||||
# of Options Granted | 150,000 | ||||
Issued and Outstanding (in shares) | 145,000 | 145,000 | 145,000 | ||
Vesting Period (in years) | 5 years | ||||
Weighted Average Exercise Price (in dollars per share) | $ 9.98 | ||||
Weighted Average Grant Date Fair Value (in dollars) | $ 4.36 | ||||
Restricted stock unit grants under the Plan | |||||
Vesting Period (in years) | 5 years | ||||
Employee Group | |||||
Stock option grants under the Plan | |||||
# of Options Granted | 2,384,094 | ||||
Issued and Outstanding (in shares) | 2,268,673 | 2,268,673 | 2,268,673 | ||
Vesting Period (in years) | 5 years | ||||
Weighted Average Exercise Price (in dollars per share) | $ 9.22 | ||||
Weighted Average Grant Date Fair Value (in dollars) | $ 3.99 | ||||
Restricted stock unit grants under the Plan | |||||
Vesting Period (in years) | 5 years | ||||
Restricted Stock Units (RSUs) | |||||
Restricted stock unit grants under the Plan | |||||
Issued and outstanding | 625,261 | 625,261 | 625,261 | ||
Restricted Stock Units (RSUs) | Director Group | |||||
Stock option grants under the Plan | |||||
Vesting Period (in years) | 1 year | ||||
Restricted stock unit grants under the Plan | |||||
# of Restricted Stock Units Granted | 121,212 | ||||
Issued and outstanding | 89,700 | 89,700 | 89,700 | ||
Vesting Period (in years) | 1 year | ||||
Grant Date Fair Value | $ 5.78 | $ 5.78 | $ 5.78 | ||
2017 Omnibus Incentive Plan | |||||
Stock options and restricted stock units granted under the 2017 Plan | |||||
Number of shares authorized | 4,500,000 | ||||
Stock option grants under the Plan | |||||
Vesting Period (in years) | 5 years | ||||
Restricted stock unit grants under the Plan | |||||
Vesting Period (in years) | 5 years | ||||
2017 Omnibus Incentive Plan | Director Group | Minimum | |||||
Stock option grants under the Plan | |||||
Vesting Period (in years) | 1 year | ||||
Restricted stock unit grants under the Plan | |||||
Vesting Period (in years) | 1 year | ||||
2017 Omnibus Incentive Plan | Director Group | Maximum | |||||
Stock option grants under the Plan | |||||
Vesting Period (in years) | 5 years | ||||
Restricted stock unit grants under the Plan | |||||
Vesting Period (in years) | 5 years | ||||
2017 Omnibus Incentive Plan | Stock Option | |||||
Stock option grants under the Plan | |||||
# of Options Granted | 382,500 | ||||
Issued and Outstanding (in shares) | 2,413,673 | 2,413,673 | 2,413,673 | 2,066,529 | |
Weighted Average Exercise Price (in dollars per share) | $ 3.82 | ||||
2017 Omnibus Incentive Plan | Restricted Stock Units (RSUs) | |||||
Restricted stock unit grants under the Plan | |||||
# of Restricted Stock Units Granted | 89,700 | ||||
Issued and outstanding | 625,261 | 625,261 | 625,261 | 841,361 | |
2017 Omnibus Incentive Plan | Restricted Stock Units (RSUs) | Employee Group | |||||
Stock option grants under the Plan | |||||
Vesting Period (in years) | 5 years | ||||
Restricted stock unit grants under the Plan | |||||
# of Restricted Stock Units Granted | 1,568,655 | ||||
Issued and outstanding | 535,561 | 535,561 | 535,561 | ||
Vesting Period (in years) | 5 years | ||||
Grant Date Fair Value | $ 10.59 | $ 10.59 | $ 10.59 |
STOCK-BASED COMPENSATION Fair V
STOCK-BASED COMPENSATION Fair Value (Details) | 6 Months Ended |
Jun. 30, 2019 | |
Fair value of stock option grants | |
Weighted average expected life | 6 years 6 months |
Expected dividend rate | 0.00% |
Minimum | |
Fair value of stock option grants | |
Risk-free interest rate | 2.55% |
Expected volatility | 37.50% |
Maximum | |
Fair value of stock option grants | |
Risk-free interest rate | 2.58% |
Expected volatility | 37.51% |
STOCK-BASED COMPENSATION Opti_2
STOCK-BASED COMPENSATION Option Activity (Details) - Stock Option - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | |
Weighted Average Remaining Contractual Terms and Aggregate Intrinsic Value | |||
Weighted average fair value option granted | $ 0.6 | $ 1.2 | |
2017 Omnibus Incentive Plan | |||
Shares | |||
Outstanding, at the beginning (in shares) | 2,066,529 | ||
Granted (in shares) | 382,500 | ||
Forfeited or expired (in shares) | (35,356) | ||
Outstanding, at the end (in shares) | 2,413,673 | 2,066,529 | |
Exercisable at the end, Shares | 624,620 | ||
Vested and expected to vest (in shares) | 2,413,673 | ||
Weighted Average Exercise Price | |||
Outstanding, at the beginning (in dollars per shares) | $ 10.23 | ||
Granted (in dollars per shares) | 3.82 | ||
Forfeited or expired (in dollars per shares) | 10.33 | ||
Outstanding, at the end (in dollars per shares) | 9.21 | $ 10.23 | |
Exercisable at the end (in dollars per shares) | 10.28 | ||
Vested and expected to vest (in dollars per share) | $ 9.21 | ||
Weighted Average Remaining Contractual Terms and Aggregate Intrinsic Value | |||
Weighted Average Remaining Contractual Terms (Years) | 8 years 3 months 18 days | 8 years 6 months | |
Exercisable at the end, Weighted Average Remaining Contractual Terms (Years) | 7 years 9 months 18 days | ||
Vested and expected to vest (in years) | 8 years 3 months 18 days | ||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years |
STOCK-BASED COMPENSATION Restri
STOCK-BASED COMPENSATION Restricted Stock (Details) - Restricted Stock Units (RSUs) | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Number of Units | |
Non-vested at the end (in units) | 625,261 |
2017 Omnibus Incentive Plan | |
Number of Units | |
Non-vested at the beginning (in units) | 841,361 |
Granted (in units) | 89,700 |
Vested (in units) | (174,296) |
Forfeited (in units) | (131,504) |
Non-vested at the end (in units) | 625,261 |
Weighted Average Grant Date Fair Value (Per Unit) | |
Outstanding at the beginning (per unit) | $ / shares | $ 10.44 |
Granted (per unit) | $ / shares | 4.32 |
Vested (per unit) | $ / shares | 10.19 |
Forfeited (per unit) | $ / shares | 10.51 |
Outstanding at the end (per unit) | $ / shares | $ 9.67 |
STOCK-BASED COMPENSATION Aggreg
STOCK-BASED COMPENSATION Aggregate (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Stock-based compensation | ||||
Aggregate stock-based compensation charges | $ 0.9 | $ 0.9 | $ 1.9 | $ 1.8 |
Stock Option | ||||
Stock-based compensation | ||||
Unrecognized stock-based compensation expense | 6 | $ 6 | ||
Weighted average period of recognition | 3 years 3 months 18 days | |||
Restricted Stock Units (RSUs) | ||||
Stock-based compensation | ||||
Unrecognized stock-based compensation expense | $ 5.6 | $ 5.6 | ||
Weighted average period of recognition | 3 years 1 month 6 days |
DEFINED CONTRIBUTION PLAN (Deta
DEFINED CONTRIBUTION PLAN (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
DEFINED CONTRIBUTION PLAN | ||||
Company's expense under matching requirements | $ 1.4 | $ 1.1 | $ 2.8 | $ 1.9 |
Matching contribution not yet merged | $ 0.1 | $ 0.2 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | Jun. 30, 2019USD ($) |
Letter of credit | |
Property, Plant and Equipment [Line Items] | |
Outstanding letters of credit | $ 15.9 |
REPORTABLE SEGMENTS (Details)
REPORTABLE SEGMENTS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||
Costs and Expenses | $ 445.9 | $ 368.4 | $ 878.2 | $ 688.2 | |
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 450.6 | 376.9 | 883.6 | 704.5 | |
Operating income (loss) | 4.7 | 8.5 | 5.4 | 16.3 | |
Depreciation | 35.8 | 25.5 | 73 | 48.8 | |
Amortization of intangible assets | 3.9 | 6.2 | 8.2 | 8.1 | |
Non-cash operating lease expense | 6.7 | 13.3 | |||
Interest expense | 12.7 | 11.1 | 25.4 | 21.4 | |
Income (loss) before income tax | (7.1) | (1) | (18.3) | (2.2) | |
Total assets | 1,503 | 1,324.1 | 1,503 | 1,324.1 | $ 1,390.9 |
Cash capital expenditures | 8.2 | 23.5 | 12.1 | 31.1 | |
Company freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 206.9 | 160 | 413.1 | 304.6 | |
Owner operator freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 121.7 | 112.6 | 232.7 | 208.1 | |
Brokerage | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 72.8 | 60.1 | 144.2 | 106.2 | |
Logistics | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 13.1 | 8.9 | 25.5 | 19.6 | |
Fuel surcharge | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 36.1 | 35.3 | 68.1 | 66 | |
Corporate/Eliminations | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | (5) | (3.7) | (9.6) | (6) | |
Operating income (loss) | (12.5) | (7.9) | (22.8) | (12.2) | |
Depreciation | 0.1 | 0.2 | |||
Non-cash operating lease expense | 0.1 | 0.2 | |||
Interest expense | 6.7 | 6.4 | 13.5 | 12.4 | |
Income (loss) before income tax | (18.7) | (13) | (35.8) | (23) | |
Total assets | 69.1 | 57.3 | 69.1 | 57.3 | |
Cash capital expenditures | 0.5 | 0.2 | 1 | 0.4 | |
Corporate/Eliminations | Company freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | (2.6) | (2.5) | (5.5) | (3.8) | |
Corporate/Eliminations | Owner operator freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | (1.3) | (0.6) | (2.6) | (1.1) | |
Corporate/Eliminations | Brokerage | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | (0.6) | (0.2) | (0.6) | (0.3) | |
Corporate/Eliminations | Logistics | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | (0.1) | ||||
Corporate/Eliminations | Fuel surcharge | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | (0.5) | (0.4) | (0.9) | (0.7) | |
Flatbed | Operating Segments | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Intersegment revenues and expenses | 2.5 | 1.3 | 4.6 | 2.1 | |
Total revenue | 174.9 | 162.2 | 343 | 307.2 | |
Operating income (loss) | 6.1 | 9.3 | 9.4 | 16.2 | |
Depreciation | 12.3 | 6.7 | 25.4 | 13.7 | |
Amortization of intangible assets | 1.3 | 2.5 | 3 | 2.9 | |
Non-cash operating lease expense | 3.1 | 5.5 | |||
Interest expense | 2.7 | 2 | 5.3 | 3.8 | |
Income (loss) before income tax | 3.5 | 7.4 | 4.4 | 12.6 | |
Total assets | 501.5 | 409.5 | 501.5 | 409.5 | |
Cash capital expenditures | 2.3 | 1.9 | 2.9 | 2.4 | |
Flatbed | Operating Segments | Company freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 55 | 46.2 | 110.2 | 91.4 | |
Flatbed | Operating Segments | Owner operator freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 73.4 | 72.3 | 142 | 131.6 | |
Flatbed | Operating Segments | Brokerage | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 25.7 | 23.9 | 51.1 | 46.9 | |
Flatbed | Operating Segments | Logistics | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 0.6 | 0.7 | 1.3 | 1.4 | |
Flatbed | Operating Segments | Fuel surcharge | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 20.2 | 19.1 | 38.4 | 35.9 | |
Specialized | Operating Segments | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Intersegment revenues and expenses | 2 | 2.4 | 4.1 | 3.9 | |
Total revenue | 280.7 | 218.4 | 550.2 | 403.3 | |
Operating income (loss) | 11.1 | 7.1 | 18.8 | 12.3 | |
Depreciation | 23.4 | 18.8 | 47.4 | 35.1 | |
Amortization of intangible assets | 2.6 | 3.7 | 5.2 | 5.2 | |
Non-cash operating lease expense | 3.5 | 7.6 | |||
Interest expense | 3.3 | 2.7 | 6.6 | 5.2 | |
Income (loss) before income tax | 8.1 | 4.6 | 13.1 | 8.2 | |
Total assets | 932.4 | 857.3 | 932.4 | 857.3 | |
Cash capital expenditures | 5.4 | 21.4 | 8.2 | 28.3 | |
Specialized | Operating Segments | Company freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 154.5 | 116.3 | 308.4 | 217 | |
Specialized | Operating Segments | Owner operator freight | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 49.6 | 40.9 | 93.3 | 77.6 | |
Specialized | Operating Segments | Brokerage | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 47.7 | 36.4 | 93.7 | 59.6 | |
Specialized | Operating Segments | Logistics | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | 12.5 | 8.2 | 24.2 | 18.3 | |
Specialized | Operating Segments | Fuel surcharge | |||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||
Total revenue | $ 16.4 | $ 16.6 | $ 30.6 | $ 30.8 |
LOSS PER SHARE (Details)
LOSS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Numerator: | ||||||
Net income (loss) | $ (6.4) | $ (9.3) | $ 13.5 | $ (0.8) | $ (15.7) | $ 12.7 |
Allocation of earnings to nonvested participating restricted stock units | (0.2) | (0.2) | ||||
Net income (loss) attributable to common stockholders | (7.7) | 12.2 | (18.2) | 10.2 | ||
Numerator for basic and diluted EPS | $ (7.7) | $ 12 | $ (18.2) | $ 10 | ||
Denominator: | ||||||
Weighted-average shares outstanding - Basic | 64.5 | 59.5 | 64.5 | 56.9 | ||
Weighted-average shares outstanding - Equivalent | 1.1 | 1 | ||||
Weighted-average shares outstanding - Diluted | 64.5 | 60.6 | 64.5 | 57.9 | ||
Basic and diluted EPS (in dollars per share) | $ (0.12) | $ 0.20 | $ (0.28) | $ 0.17 | ||
Series A | ||||||
Numerator: | ||||||
Less preferred dividends | $ (1.3) | $ (1.3) | $ (2.5) | $ (2.5) |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - segment | Jul. 30, 2019 | Jul. 29, 2019 | Jun. 30, 2019 | Jun. 30, 2018 |
SUBSEQUENT EVENTS | ||||
Number of operating segments | 16 | 16 | ||
Subsequent Event | ||||
SUBSEQUENT EVENTS | ||||
Number of operating segments integrated | 3 | |||
Number of operating segments | 13 | 16 |