Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 06, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | VERRA MOBILITY CORPORATION | |
Entity Central Index Key | 0001682745 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 161,694,330 | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Title of 12(b) Security | Class A Common Stock, par value $0.0001 per share | |
Trading Symbol | VRRM | |
Security Exchange Name | NASDAQ | |
Entity File Number | 001-37979 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 81-3563824 | |
Entity Address, Address Line One | 1150 North Alma School Road | |
Entity Address, City or Town | Mesa | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85201 | |
City Area Code | 480 | |
Local Phone Number | 443-7000 | |
Document Quarterly Report | true | |
Document Transition Report | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 113,583 | $ 131,513 |
Restricted cash | 1,510 | 917 |
Accounts receivable (net of allowance for credit loss of $10.8 million at March 31, 2020) | 109,839 | 93,514 |
Unbilled receivables | 16,358 | 20,003 |
Prepaid expenses and other current assets | 24,616 | 26,491 |
Total current assets | 265,906 | 272,438 |
Installation and service parts, net | 8,022 | 8,841 |
Property and equipment, net | 73,631 | 72,266 |
Operating lease assets | 31,789 | 32,177 |
Intangible assets, net | 409,957 | 434,443 |
Goodwill | 581,730 | 584,150 |
Other non-current assets | 3,094 | 3,111 |
Total assets | 1,374,129 | 1,407,426 |
Current liabilities: | ||
Accounts payable | 39,198 | 50,825 |
Accrued liabilities | 23,701 | 25,277 |
Current portion of long-term debt | 9,104 | 28,779 |
Total current liabilities | 72,003 | 104,881 |
Long-term debt, net of current portion and deferred financing costs | 835,507 | 837,686 |
Operating lease liabilities, net of current portion | 29,917 | 30,130 |
Payable to related party pursuant to tax receivable agreement | 61,174 | 61,174 |
Asset retirement obligation | 6,387 | 6,309 |
Deferred tax liabilities, net | 24,472 | 25,716 |
Other long-term liabilities | 269 | 2,183 |
Total liabilities | 1,029,729 | 1,068,079 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity | ||
Preferred stock, $.0001 par value | ||
Common stock, $.0001 par value | 16 | 16 |
Common stock contingent consideration | 36,575 | 54,862 |
Additional paid-in capital | 387,994 | 367,266 |
Accumulated deficit | (74,241) | (80,220) |
Accumulated other comprehensive loss | (5,944) | (2,577) |
Total stockholders' equity | 344,400 | 339,347 |
Total liabilities and stockholders' equity | $ 1,374,129 | $ 1,407,426 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Allowance for credit loss | $ 10,846 | $ 8,456 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total revenue | $ 116,713 | $ 98,461 |
Operating expenses | 32,259 | 29,338 |
Selling, general and administrative expenses | 25,886 | 20,551 |
Depreciation, amortization and (gain) loss on disposal of assets, net | 29,246 | 28,941 |
Total costs and expenses | 97,300 | 80,495 |
Income from operations | 19,413 | 17,966 |
Interest expense, net | 12,451 | 16,033 |
Other income, net | (2,925) | (2,207) |
Total other (income) expenses | 9,526 | 13,826 |
Income before income tax provision (benefit) | 9,887 | 4,140 |
Income tax provision | 3,214 | 1,320 |
Net income (loss) | 6,673 | 2,820 |
Other comprehensive (loss) income: | ||
Change in foreign currency translation adjustment | (3,367) | 1,324 |
Total comprehensive income (loss) | $ 3,306 | $ 4,144 |
Net income per share: | ||
Basic | $ 0.04 | $ 0.02 |
Diluted | $ 0.04 | $ 0.02 |
Weighted average shares used in per share calculation: | ||
Basic outstanding | 160,924 | 156,057 |
Diluted outstanding | 164,427 | 156,458 |
Service Revenue | ||
Total revenue | $ 99,497 | $ 98,070 |
Cost of revenue | 1,219 | 1,389 |
Product Sales | ||
Total revenue | 17,216 | 391 |
Cost of revenue | $ 8,690 | $ 276 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Common StockPlatinum Stockholder | Common Stock Contingent Consideration | Common Stock Contingent ConsiderationPlatinum Stockholder | Additional Paid-in Capital | Additional Paid-in CapitalPlatinum Stockholder | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Beginning Balance at Dec. 31, 2018 | $ 302,056 | $ 16 | $ 73,150 | $ 348,017 | $ (113,306) | $ (5,821) | |||
Beginning Balance (in shares) at Dec. 31, 2018 | 156,057 | ||||||||
Net income | 2,820 | 2,820 | |||||||
Cumulative effect of adoption of new accounting standard, net of tax | ASU 2014-09 | (257) | (257) | |||||||
Adjustment to equity infusion from Gores | (6,205) | (6,205) | |||||||
Adjustment to tax receivable agreement liability | 2,940 | 2,940 | |||||||
Stock-based compensation | 2,143 | 2,143 | |||||||
Other comprehensive gain (loss),net of tax | 1,324 | 1,324 | |||||||
Ending Balance at Mar. 31, 2019 | 304,821 | $ 16 | 73,150 | 346,895 | (110,743) | (4,497) | |||
Ending Balance (in shares) at Mar. 31, 2019 | 156,057 | ||||||||
Beginning Balance at Dec. 31, 2019 | 339,347 | $ 16 | 54,862 | 367,266 | (80,220) | (2,577) | |||
Beginning Balance (in shares) at Dec. 31, 2019 | 159,150 | ||||||||
Net income | 6,673 | 6,673 | |||||||
Cumulative effect of adoption of new accounting standard, net of tax | ASU 2016-13 | (694) | (694) | |||||||
Earn-out shares issued to Platinum Stockholder | $ (18,287) | $ 18,287 | |||||||
Earn-out shares issued to Platinum Stockholder (in shares) | 2,500 | ||||||||
Vesting of restricted stock units (RSUs) (in shares) | 42 | ||||||||
Payment of employee tax withholding related to RSU vesting | (327) | (327) | |||||||
Stock-based compensation | 2,768 | 2,768 | |||||||
Other comprehensive gain (loss),net of tax | (3,367) | (3,367) | |||||||
Ending Balance at Mar. 31, 2020 | $ 344,400 | $ 16 | $ 36,575 | $ 387,994 | $ (74,241) | $ (5,944) | |||
Ending Balance (in shares) at Mar. 31, 2020 | 161,692 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net income | $ 6,673 | $ 2,820 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 29,250 | 28,939 |
Amortization of deferred financing costs and discounts | 903 | 1,833 |
Credit loss expense | 5,356 | 1,270 |
Deferred income taxes | (682) | (1,073) |
Stock-based compensation | 2,768 | 2,143 |
Installation and service parts expense | 393 | 257 |
Accretion expense | 64 | 90 |
(Gain) loss on disposal of assets | (4) | 2 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (22,397) | (8,372) |
Unbilled receivables | 3,648 | (3,797) |
Prepaid expenses and other current assets | 2,367 | (1,527) |
Accounts payable and accrued liabilities | (11,363) | 18,413 |
Other liabilities | (2,135) | (3,647) |
Net cash provided by operating activities | 14,841 | 37,351 |
Cash Flows from Investing Activities: | ||
Purchases of installation and service parts and property and equipment | (8,141) | (9,219) |
Cash proceeds from the sale of assets | 10 | 52 |
Net cash used in investing activities | (8,131) | (9,167) |
Cash Flows from Financing Activities: | ||
Repayment of long-term debt | (21,951) | (2,276) |
Payment of debt issuance costs | (806) | (37) |
Payment of employee tax withholding related to RSU vesting | (327) | |
Net cash used in financing activities | (23,084) | (2,313) |
Effect of exchange rate changes on cash and cash equivalents | (963) | 236 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (17,337) | 26,107 |
Cash, cash equivalents and restricted cash - beginning of period | 132,430 | 67,081 |
Cash, cash equivalents and restricted cash - end of period | 115,093 | 93,188 |
Supplemental cash flow information: | ||
Interest paid | 11,822 | 13,890 |
Income taxes paid (refunded), net | 319 | (4,710) |
Supplemental non-cash investing and financing activities: | ||
Reduction to tax receivable agreement liability | 2,940 | |
Earn-out shares issued to Platinum Stockholder | 18,287 | |
Additions to ARO, property and equipment, and other | 22 | 28 |
Purchases of installation and service parts and property and equipment in accounts payable and accrued liabilities at period-end | $ 4,586 | $ 4,084 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business | 1. Description of Business Verra Mobility Corporation (collectively with its subsidiaries, the “ Company Verra Mobility Gores IPO Nasdaq On June 21, 2018, Gores entered into an Agreement and Plan of Merger (as amended, the “ Merger Agreement ”) with Greenlight Holding II Corporation, PE Greenlight Holdings, LLC, AM Merger Sub I, Inc., a direct, wholly-owned subsidiary of Gores and AM Merger Sub II, LLC, a direct, wholly-owned subsidiary of Gores. On October 17, 2018, the transactions contemplated by the Merger Agreement (the “ Business Combination ”) were consummated. In connection with the closing of the Business Combination, Gores changed its name to Verra Mobility Corporation. As a result of the Business Combination, Verra Mobility Corporation became the owner, directly or indirectly, of all of the equity interests of Verra Mobility Holdings, LLC and its subsidiaries. Verra Mobility offers integrated technology solutions and services to commercial fleets, rental car companies and state and local governments. The Company has customers located throughout the United States, Canada and Europe. The Company is organized into two operating segments: Commercial Services and Government Solutions (see Note 15). The Commercial Services segment offers toll and violation management solutions for the commercial fleet and rental car industries by partnering with the leading fleet management and rental car companies in North America. Electronic toll payment services enable fleet drivers and rental car customers to use high-speed cashless toll lanes or all-electronic cashless toll roads. The service helps commercial fleets reduce toll management costs, while it provides rental car companies with a revenue-generating, value-added service for their customers. Electronic violation processing services reduce the cost and risk associated with vehicle-issued violations, such as toll, parking or camera-enforced tickets. Title and registration services offer title and registration processing for individuals, rental car companies and fleet management companies. In Europe, the Company provides violations processing through Euro Parking Collection plc (“ EPC Pagatelia The Government Solutions segment provides complete, end-to-end red-light, speed, school bus stop arm and bus lane enforcement solutions. The Company’s programs are designed to reduce traffic violations and resulting collisions, injuries, and fatalities. The Company implements and administers traffic safety programs for municipalities, counties, school districts and law enforcement agencies of all sizes. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2 . Significant Accounting Policies Principles of Consolidation The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company prepared in accordance with generally accepted accounting principles in the United States of America (“ GAAP Use of Estimates The preparation of these financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited interim condensed consolidated financial statements and accompanying notes. Significant items subject to such estimates and assumptions include the fair values assigned to net assets acquired (including identifiable intangibles) in business combinations, the carrying amounts of long-lived assets and goodwill, the carrying amount of installation and service parts, the allowance for credit loss, valuation allowances on deferred tax assets, asset retirement obligations, contingent consideration and the recognition and measurement of loss contingencies. Management believes that its estimates and assumptions are reasonable in the circumstances; however, actual results could differ materially from those estimates. Recent Accounting Pronouncements Accounting Standards Adopted In January 2017, the Financial Accounting Standards Board (“ FASB ASU Intangibles—Goodwill and Other (Topic 350) Goodwill and Intangible Assets In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326), CECL The Company adopted the CECL standard as of January 1, 2020 through a cumulative effect adjustment of $0.7 million, net of tax, to the opening balance of Accumulated deficit. The adjustment increased Accumulated deficit and increased the Allowance for credit loss accounts. Subsequent impacts to the Allowance for credit loss have been recorded through the Credit loss expense account included within Selling, general and administrative expenses in our condensed consolidated statements of operations and as an Allowance for credit loss on our condensed consolidated balance sheet. See Note 4. Accounts Receivable, Net Accounting Standards Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. On March 12, 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. |
Acquisition
Acquisition | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisition | 3 . Acquisition Pagatelia Acquisition On October 31, 2019, the Company completed the acquisition of all of the outstanding shares of Pagatelia S.L., (“ Pagatelia The allocation of the preliminary purchase consideration is summarized as follows: ($ in thousands) Assets acquired Cash $ 1,086 Other assets 5,047 Trademark 771 Customer relationships 5,946 Developed technology 4,624 Non-compete agreements 440 Goodwill 17,528 Total assets acquired 35,442 Liabilities assumed Accounts payable and accrued expenses 6,045 Deferred tax liability 2,801 Total liabilities assumed 8,846 Total purchase price $ 26,596 Goodwill arising from Pagatelia was assigned to the Company’s Commercial Services segment and consists largely of the expected cash flows and future growth anticipated for the Company. The goodwill is not expected to be deductible for tax purposes. The customer relationships value was based on an excess earnings methodology utilizing projected cash flows. The trademark and the developed technology values were based on a relief-from-royalty method. The non-compete agreement values were based on the with-or-without method. The trademark, customer relationships, developed technology and non-compete agreements were assigned useful lives of 8.5 years, 9.5 years, 6.5 years and 3 years, respectively. The Company did not provide pro forma financial information for Pagatelia as it was not material. |
Accounts Receivable, Net
Accounts Receivable, Net | 3 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
Accounts Receivable, Net | 4. Accounts Receivable, Net Accounts receivable are uncollateralized customer obligations due from the sale of products or services. Accounts receivable have normal trade terms less than one year and are initially stated at the amounts billed to the customers. Accounts receivable are subsequently measured at amortized cost net of allowance for credit loss. As part of its analysis for implementation of the CECL standard, the Company reviewed historical loss rates, customer payment trends and collection rates on customer balances. Estimated loss rates were developed using historical credit loss experience, which were adjusted based on a range of likelihood increases to reflect management’s expectations of current and future conditions as of the balance sheet date. Receivables are written off against the allowance for credit loss when it is probable that amounts will not be collected based on terms of the customer contracts, and subsequent recoveries will be credited to earnings in the period recovered. The Company will periodically evaluate the adequacy of its allowance for expected credit loss by comparing its actual historical write-offs to its previously recorded estimates. The Company identified portfolio segments based on type of business, industry in which the customer operates and historical credit loss patterns . The following presents by portfolio segment Accounts receivable, net and the activity in the A llowance for credit loss for the three months ended March 31, 2020 : ($ in thousands) Commercial Services (Driver-billed) (1) Commercial Services (All other) Government Solutions Total Accounts Receivable, Net at January 1, 2020 (2) $ 9,793 $ 51,158 $ 31,744 $ 92,695 Allowance for credit loss at January 1, 2020 (2) $ 5,733 $ 945 $ 1,778 $ 8,456 Credit loss expense 1,925 2,731 700 5,356 Write-offs, net of recoveries (2,220 ) (311 ) (435 ) (2,966 ) Allowance for credit loss at March 31, 2020 $ 5,438 $ 3,365 $ 2,043 $ 10,846 Accounts Receivable, Net at March 31, 2020 $ 9,430 $ 50,898 $ 49,511 $ 109,839 (1) (2) This includes Concentration of Credit Risk Significant customers are those which represent more than 10% of the Company’s total revenue. Revenue from one of the Government Solutions customers, the City of New York Department of Transportation, accounted for 25.5% of total revenue for the three months ended March 31, 2020, as a result of increased product revenue. This customer did not meet the revenue criteria for the three months ended March 31, 2019. Revenue generated through one of the Company’s Commercial Services partners, the Hertz Corporation, accounted for 15.7% and 18.4% of total revenue for the three months ended March 31, 2020 and 2019, respectively. Additionally, revenue generated through two of the Company’s Commercial Services partners, Avis Budget Group, Inc. and Enterprise Holdings, Inc., accounted for 12.7% and 10.8%, respectively, of total revenue for the three months ended March 31, 2020. Enterprise Holdings, Inc., accounted for 14.0% for the three months ended March 31, 2019. Avis Budget Group, Inc. did not meet the revenue criteria above for the 2019 period. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 3 Months Ended |
Mar. 31, 2020 | |
Prepaid Expense And Other Assets Current [Abstract] | |
Prepaid Expenses and Other Current Assets | 5 . Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following at: ($ in thousands) March 31, 2020 December 31, 2019 Prepaid tolls $ 11,002 $ 10,116 Prepaid services 5,327 5,201 Deposits 3,510 3,642 Prepaid computer maintenance 2,715 2,923 Prepaid insurance 1,033 1,485 Photo enforcement equipment held for sale 416 1,410 Prepaid income taxes 162 1,025 Other 451 689 Total prepaid expenses and other current assets $ 24,616 $ 26,491 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 6 . Goodwill and Intangible Assets The following table presents the changes in the carrying amount of goodwill by reportable segment: Commercial Government ($ in thousands) Services Solutions Total Balance at December 31, 2019 $ 424,404 $ 159,746 $ 584,150 Foreign currency translation adjustment (2,420 ) — (2,420 ) Balance at March 31, 2020 $ 421,984 $ 159,746 $ 581,730 Intangible assets consist of the following as of the respective period-ends: March 31, 2020 December 31, 2019 Weighted Weighted Average Gross Average Gross Remaining Carrying Accumulated Remaining Carrying Accumulated ($ in thousands) Useful Life Amount Amortization Useful Life Amount Amortization Trademarks 1.2 years $ 32,071 $ 21,651 1.5 years $ 32,127 $ 19,106 Non-compete agreements 2.8 years 62,553 27,977 3.0 years 62,549 24,834 Customer relationships 6.6 years 365,463 92,951 6.9 years 366,533 82,903 Developed technology 3.1 years 165,525 73,076 3.3 years 165,708 65,631 Gross carrying value of intangible assets 625,612 $ 215,655 626,917 $ 192,474 Less: accumulated amortization (215,655 ) (192,474 ) Intangible assets, net $ 409,957 $ 434,443 The amortization expense was $23.5 million and $23.1 million for the three months ended March 31, 2020 and 2019, respectively. Estimated amortization expense in future years is expected to be: ($ in thousands) Remainder of 2020 $ 70,276 2021 85,416 2022 80,686 2023 52,171 2024 41,684 Thereafter 79,724 Total $ 409,957 Interim Goodwill Impairment Review During the fourth quarter of each fiscal year, in conjunction with the Company’s annual strategic planning process, we perform our annual goodwill impairment test for each of our reporting units. Our reporting units are the same as our two reportable segments (Government Solutions and Commercial Services). We also test goodwill for impairment whenever events or circumstances occur which, in our judgment, could more likely than not reduce the fair value of one or more reporting units below its carrying amount. Potential impairment indicators include, but are not limited to, (i) a deterioration of the business environments in which we operate, (ii) downward revisions to internal forecasts, and the magnitude thereof, if any, and (iii) declines in our market capitalization below our book value, and the magnitude and duration of those declines, if any. During the first quarter of 2020, our market capitalization declined significantly compared to December 31, 2019. Over the same period, the equity value of our key Commercial Services’ customers, our peer group companies and the overall U.S. stock market also declined significantly amid market volatility. These declines were driven by the uncertainty surrounding the outbreak of the novel coronavirus (“ COVID-19 Based upon the results of our interim impairment test, we concluded that the fair values of the Government Solutions and Commercial Services reporting units exceeded their carrying value . The current economic conditions due to COVID-19 are still evolving and any significant adverse changes in future periods to our internal forecasts or the external market conditions, if any, could reasonably be expected to negatively affect our key assumptions and may result in a future goodwill impairment charge , which could be material . |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Payables And Accruals [Abstract] | |
Accrued Liabilities | 7 . Accrued Liabilities Accrued liabilities consist of the following at: ($ in thousands) March 31, 2020 December 31, 2019 Accrued salaries and wages $ 5,282 $ 10,319 Current portion of related party TRA liability 4,636 5,730 Current portion of operating lease liabilities 2,987 2,970 Advanced deposits payable 2,322 2,875 Income taxes payable 4,675 348 Restricted cash due to customers 1,510 917 Accrued sales commissions 551 612 Accrued interest payable 176 210 Other 1,562 1,296 Total accrued liabilities $ 23,701 $ 25,277 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | 8 . Debt The following table provides a summary of the Company’s long-term debt at: ($ in thousands) March 31, 2020 December 31, 2019 First Lien Term Loan, due February 28, 2025 $ 872,470 $ 894,421 Less: original issue discounts (4,648 ) (4,778 ) Less: unamortized deferred financing costs (23,211 ) (23,178 ) Total debt 844,611 866,465 Less: current portion of long-term debt (9,104 ) (28,779 ) Total long-term debt, net of current portion $ 835,507 $ 837,686 In connection with an acquisition in 2018, VM Consolidated, Inc. (formerly known as ATS Consolidated, Inc.), a wholly-owned subsidiary of the Company, entered into a First Lien Term Loan Credit Agreement (the “ First Lien Term Loan Second Lien Term Loan ”), (collectively the “ Term Loans ”) and a Revolving Credit Facility Agreement (the “ Revolver ”) with a syndicate of lenders (collectively, the “ 2018 Credit Facilities ”). The 2018 Credit Facilities initially provided for committed senior secured financing of $1.115 billion, consisting of the Term Loans in an aggregate principal amount of $1.04 billion and the Revolver available for loans and letters of credit with an aggregate revolving commitment of up to $75 million (subject to borrowing eligibility requirements as described below). . The First Lien Term Loan is repayable at 1.0% per annum of the amount initially borrowed, paid in quarterly installments. The First Lien Term Loan matures on February 28, 2025. The Company refinanced the entire outstanding amount under the First Lien Term Loan on February 20, 2020 which reduced the previous applicable margin by 50 basis points. The First Lien Term Loan now bears interest based, at our option, on either (1) LIBOR plus an applicable margin of 3.25% per annum, or (2) an alternate base rate plus an applicable margin of 2.25% per annum. As of March 31, 2020, the interest rate on the First Lien Term Loan was 4.24%. In addition, the First Lien Term Loan requires mandatory prepayments equal to the product of the excess cash flows of the Company (as defined in the loan agreement) and the applicable prepayment percentages (calculated as of the last day of the fiscal year, beginning with the year ending December 31, 2019), as set forth in the following table: Consolidated first lien net leverage ratio (as defined by the First Lien Term Loan agreement) Applicable prepayment percentage > 3.70:1.00 50% < 25% < 0% The Company made a $19.7 million mandatory prepayment of excess cash flow during the first quarter of fiscal 2020. The Revolver matures on February 28, 2023. The terms of the Revolver were not affected by the refinancing of the First Lien Term Loan discussed above. Borrowing eligibility under the Revolver is subject to a monthly borrowing base calculation based on (i) certain percentages of eligible accounts receivable and inventory, less (ii) certain reserve items, including outstanding letters of credit and other reserves. The Revolver bears interest on either (1) LIBOR plus an applicable margin, or (2) an alternate base rate, plus an applicable margin. The margin percentage applied to (1) LIBOR is either 1.25%, 1.50%, or 1.75%, or (2) the base rate is either 0.25%, 0.50%, or 0.75%, depending on the Company’s average availability to borrow under the commitment. At March 31, 2020, the Company had no outstanding borrowings on the Revolver and availability to borrow under the Revolver was $68.8 million, net of $6.2 million of outstanding letters of credit. Interest on the unused portion of the Revolver is payable quarterly at 0.375%, and the Company is also required to pay participation and fronting fees at 1.38% on $6.2 million in outstanding letters of credit as of March 31, 2020. All borrowings and other extensions of credits under the 2018 Credit Facilities are subject to the satisfaction of customary conditions and restrictive covenants including absence of defaults and accuracy in material respects of representations and warranties. At March 31, 2020, the Company was compliant with the 2018 Credit Facilities covenants. Substantially all of the Company’s assets are pledged as collateral to secure the Company’s indebtedness under the 2018 Credit Facilities. The Company recorded interest expense, including amortization of deferred financing costs and discounts, of $12.5 million and $16.0 million for the three months ended March 31, 2020 and March 31, 2019, respectively. In connection with the refinancing of the First Lien Term Loan in February 2020, which the Company determined was to be accounted for as a modification, the Company incurred $0.8 million of lender fees which were capitalized as deferred financing costs and amortized over the remaining life of the First Lien Term Loan, and $0.2 million of legal fees that were expensed as Selling, general and administrative expenses on the condensed consolidated statement of operations. The weighted average effective interest rates on the Company’s outstanding borrowing under the 2018 Credit Facilities were 4.24% and 5.5% at March 31, 2020 and December 31, 2019, respectively. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 9. Fair Value of Financial Instruments ASC Topic 820, Fair Value Measurement, Level 1 – Fair value is based on observable inputs such as quoted prices for identical assets or liabilities in active markets. Level 2 – Fair value is determined using quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active or inputs other than quoted prices that are directly or indirectly observable. Level 3 – Fair value is determined using one or more significant inputs that are unobservable in active markets at the measurement date, such as a pricing model, discounted cash flow, or similar technique. The carrying amounts reported in the Company’s condensed consolidated balance sheets for cash, accounts receivable, accounts payable and accrued expenses approximate fair value due to the immediate to short-term maturity of these financial instruments. The estimated fair value of the Company’s First Lien Term Loan as of March 31, 2020 and December 31, 2019 was categorized in Level 2 of the fair value hierarchy and was calculated based upon available market information. The carrying value and fair value of debt is as follows: Level in March 31, 2020 December 31, 2019 Fair Value Carrying Estimated Carrying Estimated ($ in thousands) Hierarchy Amount Fair Value Amount Fair Value Total debt 2 $ 844,611 $ 811,397 $ 866,465 $ 905,601 |
Net Income Per Share
Net Income Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | 10 . Net Income Per Share Basic net income per share is calculated by dividing net income by the weighted average shares outstanding during the period, without consideration of common stock equivalents. Diluted net income per share is calculated by adjusting the weighted average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury-stock method. The components of basic and diluted net income per share are as follows: Three Months Ended March 31, (In thousands, except per share data) 2020 2019 Numerator: Net income $ 6,673 $ 2,820 Denominator: Weighted average shares - basic 160,924 156,057 Common stock equivalents 3,503 401 Weighted average shares - diluted 164,427 156,458 Net income per share - basic $ 0.04 $ 0.02 Net income per share - diluted $ 0.04 $ 0.02 Antidilutive weighted average shares excluded from diluted net income per share: Contingently issuable shares (1) 5,742 10,000 Warrants — 20,000 Non-qualified stock options 209 — Performance share units 35 — Restricted stock units 28 86 Total antidilutive shares excluded 6,014 30,086 (1) Related Party Transactions |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11 . Income Taxes Our interim income tax provision is determined using an estimated annual effective tax rate, adjusted for discrete items arising in that period. The estimated annual effective tax rate requires judgment and is dependent upon several factors. We provide for income taxes under the liability method. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of differences between the tax basis of assets or liabilities and their carrying amounts in the financial statements. We provide a valuation allowance for deferred tax assets if it is more likely than not that these items will expire before we are able to realize their benefit. We calculate the valuation allowance in accordance with the authoritative guidance relating to income taxes, which requires an assessment of both positive and negative evidence regarding the realizability of these deferred tax assets, when measuring the need for a valuation allowance. Significant judgment is required in determining any valuation allowance against deferred tax assets. In December 2019, novel coronavirus (“ COVID-19 CARES Act Our effective income tax rate was 32.5% and 31.9% for the three months ended March 31, 2020 and 2019, respectively. The effective tax rate change was primarily due to an increase in certain permanent differences, including the limitation on the deductibility of executive compensation imposed by section 162(m) of the Internal Revenue Code, as amended, applied to an overall lower gross income. The total amount of unrecognized tax benefits decreased by $0.9 million during the quarter primarily from the statute expiration of prior year tax positions. As of March 31, 2020, the total amount of unrecognized tax benefits was $0.8 million, of which $0.7 million would affect our effective tax rate if recognized. We recognize interest and penalties related to unrecognized tax benefits through income tax expense. As of March 31, 2020, we had less than $0.1 million accrued for the payment of interest and penalties. The Company is subject to examination by the Internal Revenue Service and taxing authorities in various states. The Company’s U.S. federal income tax returns remain subject to examination by tax authorities for the years 2016 to 2019. The Company’s state income tax returns are under examination by certain states for tax years 2015 to 2017, and other state income tax returns are subject to examination for tax years 2014 to 2019. Tax returns for years prior to 2014 remain open in a number of states due to tax attributes generated but not utilized yet. The Company regularly assesses the likelihood of additional tax deficiencies in each of the tax jurisdictions and, accordingly, makes appropriate adjustments to the tax provision as deemed necessary. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | 12 . Stock-Based Compensation The following details the components of stock-based compensation for the periods presented: Three Months Ended March 31, ($ in thousands) 2020 2019 Operating expenses $ 220 $ 204 Selling, general and administrative expenses 2,548 1,939 Total stock-based compensation expense $ 2,768 $ 2,143 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 13 . Related Party Transactions Tax Receivable Agreement At the closing of the Business Combination, the Company entered into a tax receivable agreement (“ TRA Platinum Stockholder March 31, 2020 Earn-Out Agreement Under the Merger Agreement, the Platinum Stockholder is entitled to receive additional shares of Class A Common Stock (the “ Earn-Out Shares” ) if the volume weighted average closing sale price of one share of Class A Common Stock on the Nasdaq exceeds certain thresholds for a period of at least 10 days out of 20 consecutive trading days at any time during the five-year Business Combination (the “ Common Stock Price ”). The Earn-Out Shares are issued by the Company to the Platinum Stockholder as follows: Common Stock Price thresholds One-time issuance of shares > $13.00 (a) 2,500,000 > $15.50 (a) 2,500,000 > $18.00 2,500,000 > $20.50 2,500,000 (a) If any of the Common Stock Price thresholds above (each, a “ Triggering Event ”) are not achieved within the five-year period following the closing of the Business Combination , the Company will not be required to issue the Earn-Out Shares in respect of such Common Stock Price threshold. In no event shall the Platinum Stockholder be entitled to receive more than an aggregate of 10,000,000 Earn-Out Shares. If, during the earn-out period, there is a change of control (as defined in the Merger Agreement) that will result in the holders of Greenlight Acquisition Corporation (“ Parent ”) Class A Common Stock receiving a per share price equal to or in excess of the applicable Common Stock Price required in connection with any Triggering Event (an “ Acceleration Event ”), then immediately prior to the consummation of such change of control: (a) any such Triggering Event that has not previously occurred shall be deemed to have occurred; and (b) Parent shall issue the applicable Earn-Out Shares to the cash consideration stockholders (as defined in the Merger Agreement) (in accordance with their respective pro rata cash share), and the recipients of the issued Earn-Out Shares shall be eligible to participate in such change of control. The Company estimated the original fair value of the contingently issuable shares to be $73.15 million, of which $36.6 million remains contingently issuable as of March 31, 2020. The estimated value is not subject to future revisions during the five-year period discussed above. The Company used a Monte Carlo simulation option-pricing model to arrive at its original estimate. Each tranche was valued separately giving specific consideration to the tranche’s price target. The simulation considered volatility and risk free rates utilizing a peer group based on a five year term. This was initially recorded as a distribution to shareholders and was presented as Common stock contingent consideration. Upon the occurrence of a Triggering Event, any issuable shares would be transferred from Common stock contingent consideration to Common stock and Additional paid-in capital accounts. Any contingently issuable shares not issued as a result of a Triggering Event not being attained by the end of earn-out period will be cancelled. On April 26, 2019 and on January 27, 2020, the Triggering Events for the issuance of the first and second tranches of Earn-Out Shares occurred, as the volume weighted average closing sale price per share of the Company’s Class A Common Stock as of that date had been greater than $13.00 and $15.50, respectively, for 10 out of 20 consecutive trading days. These Triggering Events resulted in the issuance of an aggregate 5,000,000 shares of the Company’s Class A Common Stock to the Platinum Stockholder and an increase in the Company’s Common stock and Additional paid-in capital accounts of $36.6 million, with a corresponding decrease to the Common stock contingent consideration account. |
Commitment and Contingencies
Commitment and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 14 . Commitments and Contingencies The Company has issued various letters of credit under contractual arrangements with certain of its vendors and customers. Outstanding letters of credit under these arrangements totaled $6.2 million at March 31, 2020. The Company has non-cancelable purchase commitments to certain vendors. The aggregate non-cancelable purchase commitments outstanding at March 31, 2020 were $27.4 million. The Company is subject to tax audits in the normal course of business and does not have material contingencies recorded related to such audits. Legal Proceedings The Company is subject to legal and regulatory actions that arise from time to time in the ordinary course of business. The Company records a liability when it believes it is probable a loss will be incurred and the amount of loss or range of loss can be reasonably estimated. The assessment as to whether a loss is probable, reasonably possible or remote, and as to whether a loss or a range of such loss is estimable, often involves significant judgment about future events. The Company has determined that resolution of pending matters is not probable to have a material adverse impact on its condensed consolidated results of operations, cash flows, or financial position, and accordingly, no material contingency accruals are recorded. However, the outcome of litigation is inherently uncertain. As additional information becomes available, the Company reassesses the potential liability. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting | 15 . Segment Reporting The Company has two operating and reportable segments, Commercial Services and Government Solutions. Commercial Services offers toll and violation management solutions and title and registration services to commercial fleet vehicle owners, rental car companies and violation issuing authorities. Government Solutions implements and administers traffic safety programs and products for municipalities and local government agencies of all sizes. The Company’s Chief Operating Decision Maker function (“ CODM ”) is comprised of the Company’s CEO and certain defined representatives of the Company’s executive management team. The Company’s CODM monitors operating performance, allocates resources and deploys capital based on these Segment performance is based on revenues and income from operations before depreciation, amortization, gain (loss) on disposal of assets, net, and stock-based compensation. The measure also excludes interest expense, net, income taxes and is inclusive of other income, net. The tables below refer to this measure as Segment profit (loss). The aforementioned items are not indicative of operating performance, and, as a result are not included in the measures that are reviewed by the CODM for the segments. Other income, net consists primarily of credit card rebates earned on the prepayment of tolling violations and is therefore included in Segment profit (loss). There are no significant non-cash items reported in Segment profit (loss). The following tables set forth financial information by segment for the three months ended March 31, 2020 and March 31, 2019, respectively: For the Three Months Ended March 31, 2020 Commercial Government Corporate ($ in thousands) Services Solutions and Other Total Service revenue $ 61,242 $ 38,255 $ — $ 99,497 Product sales — 17,216 — 17,216 Total revenue 61,242 55,471 — 116,713 Cost of service revenue 807 412 — 1,219 Cost of product sales — 8,690 — 8,690 Operating expenses 16,530 15,509 — 32,039 Selling, general and administrative expenses 13,384 9,669 285 23,338 Other income, net (2,889 ) (36 ) — (2,925 ) Segment profit (loss) $ 33,410 $ 21,227 $ (285 ) $ 54,352 Segment profit (loss) $ 33,410 $ 21,227 $ (285 ) $ 54,352 Depreciation and amortization — — 29,250 29,250 Gain on disposal of assets, net — (4 ) — (4 ) Stock-based compensation — — 2,768 2,768 Interest expense, net — — 12,451 12,451 Income (loss) before income tax provision $ 33,410 $ 21,231 $ (44,754 ) $ 9,887 For the Three Months Ended March 31, 2019 Commercial Government Corporate ($ in thousands) Services Solutions and Other Total Service revenue $ 62,588 $ 35,482 $ — $ 98,070 Product sales — 391 — 391 Total revenue 62,588 35,873 — 98,461 Cost of service revenue 864 525 — 1,389 Cost of product sales — 276 — 276 Operating expenses 15,096 14,038 — 29,134 Selling, general and administrative expenses 10,762 7,850 — 18,612 Other income, net (2,171 ) (37 ) 1 (2,207 ) Segment profit (loss) $ 38,037 $ 13,221 $ (1 ) $ 51,257 Segment profit (loss) $ 38,037 $ 13,221 $ (1 ) $ 51,257 Depreciation and amortization — — 28,939 28,939 Loss on disposal of assets, net — — 2 2 Stock-based compensation — — 2,143 2,143 Interest expense, net — — 16,033 16,033 Income (loss) before income tax provision $ 38,037 $ 13,221 $ (47,118 ) $ 4,140 |
Guarantor_Non-Guarantor Financi
Guarantor/Non-Guarantor Financial Information | 3 Months Ended |
Mar. 31, 2020 | |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | |
Guarantor/Non-Guarantor Financial Information | 16 . Guarantor/Non-Guarantor Financial Information VM Consolidated, Inc., a wholly-owned subsidiary of the Company, is the lead borrower of the First Lien Term Loan and the Revolver. VM Consolidated, Inc. is owned by the Company through a series of holding companies that ultimately end with the Company. VM Consolidated, Inc. is wholly-owned by Greenlight Acquisition Corporation The following financial information presents the Condensed Consolidated Balance Sheets as of March 31, 2020 and the related Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) and Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2020 for the Company, combined guarantor subsidiaries and combined non-guarantor subsidiaries. Verra Mobility Corporation and Subsidiaries Condensed Consolidated Balance Sheets at March 31, 2020 (Unaudited) ($ in thousands) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Assets Current assets: Cash and cash equivalents $ — $ 96,623 $ 16,960 $ — $ 113,583 Restricted cash — 1,510 — — 1,510 Accounts receivable (net of allowance for credit loss of $10.8 million ) — 105,799 4,040 — 109,839 Unbilled receivables — 16,071 287 — 16,358 Investment in subsidiary 175,141 75,098 — (250,239 ) — Prepaid expenses and other current assets — 22,116 2,500 — 24,616 Total current assets 175,141 317,217 23,787 (250,239 ) 265,906 Installation and service parts, net — 8,022 — — 8,022 Property and equipment, net — 70,588 3,043 — 73,631 Operating lease assets — 31,387 402 — 31,789 Intangible assets, net — 382,654 27,303 — 409,957 Goodwill — 524,767 56,963 — 581,730 Due from affiliates 169,259 — (169,259 ) — Other non-current assets — 3,080 14 — 3,094 Total assets $ 344,400 $ 1,337,715 $ 111,512 $ (419,498 ) $ 1,374,129 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ — $ 26,071 $ 13,127 $ — $ 39,198 Accrued liabilities — 20,580 3,121 — 23,701 Current portion of long-term debt — 9,104 — — 9,104 Total current liabilities — 55,755 16,248 — 72,003 Long-term debt, net of current portion and deferred financing costs — 835,507 — — 835,507 Operating lease liabilities, net of current portion — 29,712 205 — 29,917 Payable to related party pursuant to tax receivable agreement — 61,174 — — 61,174 Due to affiliates — 154,091 15,168 (169,259 ) — Asset retirement obligation — 6,387 — — 6,387 Deferred tax liabilities, net — 19,679 4,793 — 24,472 Other long-term liabilities — 269 — — 269 Total liabilities — 1,162,574 36,414 (169,259 ) 1,029,729 Total stockholders' equity 344,400 175,141 75,098 (250,239 ) 344,400 Total liabilities and stockholders' equity $ 344,400 $ 1,337,715 $ 111,512 $ (419,498 ) $ 1,374,129 Verra Mobility Corporation and Subsidiaries Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) Three Months Ended March 31, 2020 (Unaudited) ($ in thousands) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Service revenue $ — $ 95,650 $ 3,847 $ — $ 99,497 Product sales — 17,216 — — 17,216 Total revenue — 112,866 3,847 — 116,713 Cost of service revenue — 667 552 — 1,219 Cost of product sales — 8,690 — — 8,690 Operating expenses — 30,578 1,681 — 32,259 Selling, general and administrative expenses — 23,976 1,910 — 25,886 Depreciation, amortization and (gain) loss on disposal of assets, net — 27,995 1,251 — 29,246 Total costs and expenses — 91,906 5,394 — 97,300 Income (loss) from operations — 20,960 (1,547 ) — 19,413 (Income) loss from equity investment (6,673 ) 1,307 — 5,366 — Interest expense, net — 12,462 (11 ) — 12,451 Other income, net — (2,887 ) (38 ) — (2,925 ) Total other (income) expenses (6,673 ) 10,882 (49 ) 5,366 9,526 Income before income tax provision (benefit) 6,673 10,078 (1,498 ) (5,366 ) 9,887 Income tax provision (benefit) — 3,405 (191 ) — 3,214 Net income (loss) $ 6,673 $ 6,673 $ (1,307 ) $ (5,366 ) $ 6,673 Other comprehensive loss: Change in foreign currency translation adjustment — (3,367 ) — — (3,367 ) Total comprehensive income (loss) $ 6,673 $ 3,306 $ (1,307 ) $ (5,366 ) $ 3,306 Verra Mobility Corporation and Subsidiaries Condensed Consolidated Statements of Cash Flows Three Months Ended March 31, 2020 (Unaudited) ($ in thousands) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Cash Flows from Operating Activities: Net income (loss) $ 6,673 $ 6,673 $ (1,307 ) $ (5,366 ) $ 6,673 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization — 27,999 1,251 — 29,250 Amortization of deferred financing costs and discounts — 903 — — 903 Credit loss expense — 5,356 — — 5,356 Deferred income taxes — (94 ) (588 ) — (682 ) Stock-based compensation — 2,768 — — 2,768 Installation and service parts expense — 393 — — 393 Accretion expense — 64 — — 64 Gain on disposal of assets — (4 ) — — (4 ) (Income) loss from equity investment (6,673 ) 1,307 — 5,366 — Changes in operating assets and liabilities: Accounts receivable, net — (23,028 ) 631 — (22,397 ) Unbilled receivables — 3,246 402 — 3,648 Prepaid expenses and other current assets — 2,628 (261 ) — 2,367 Accounts payable and accrued liabilities — (10,444 ) (919 ) — (11,363 ) Due to affiliates — (1,341 ) 1,341 — — Other liabilities — (2,135 ) — — (2,135 ) Net cash provided by operating activities — 14,291 550 — 14,841 Cash Flows from Investing Activities: Purchases of installation and service parts and property and equipment — (7,370 ) (771 ) — (8,141 ) Cash proceeds from the sale of assets — 10 — — 10 Net cash used in investing activities — (7,360 ) (771 ) — (8,131 ) Cash Flows from Financing Activities: Repayment of long-term debt — (21,951 ) — — (21,951 ) Payment of debt issuance costs — (806 ) — — (806 ) Payment of employee tax withholding related to RSU vesting — (327 ) — — (327 ) Net cash used in financing activities — (23,084 ) — — (23,084 ) Effect of exchange rate changes on cash and cash equivalents — — (963 ) — (963 ) Net decrease in cash, cash equivalents and restricted cash — (16,153 ) (1,184 ) — (17,337 ) Cash, cash equivalents and restricted cash - beginning of period — 114,286 18,144 — 132,430 Cash, cash equivalents and restricted cash - end of period $ — $ 98,133 $ 16,960 $ — $ 115,093 Verra Mobility Corporation and Subsidiaries Condensed Consolidated Statements of Cash Flows (Continued) Three Months Ended March 31, 2020 (Unaudited) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Supplemental cash flow information: Interest paid $ — $ 11,822 $ — $ — $ 11,822 Income taxes paid, net — 156 163 — 319 Supplemental non-cash investing and financing activities: Earn-out shares issued to Platinum Stockholder 18,287 — — — 18,287 Additions to ARO, property and equipment, and other — 22 — — 22 Purchases of installation and service parts and property and equipment in accounts payable and accrued liabilities at period-end — 4,586 — — 4,586 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company prepared in accordance with generally accepted accounting principles in the United States of America (“ GAAP |
Use of Estimates | Use of Estimates The preparation of these financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited interim condensed consolidated financial statements and accompanying notes. Significant items subject to such estimates and assumptions include the fair values assigned to net assets acquired (including identifiable intangibles) in business combinations, the carrying amounts of long-lived assets and goodwill, the carrying amount of installation and service parts, the allowance for credit loss, valuation allowances on deferred tax assets, asset retirement obligations, contingent consideration and the recognition and measurement of loss contingencies. Management believes that its estimates and assumptions are reasonable in the circumstances; however, actual results could differ materially from those estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Standards Adopted In January 2017, the Financial Accounting Standards Board (“ FASB ASU Intangibles—Goodwill and Other (Topic 350) Goodwill and Intangible Assets In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326), CECL The Company adopted the CECL standard as of January 1, 2020 through a cumulative effect adjustment of $0.7 million, net of tax, to the opening balance of Accumulated deficit. The adjustment increased Accumulated deficit and increased the Allowance for credit loss accounts. Subsequent impacts to the Allowance for credit loss have been recorded through the Credit loss expense account included within Selling, general and administrative expenses in our condensed consolidated statements of operations and as an Allowance for credit loss on our condensed consolidated balance sheet. See Note 4. Accounts Receivable, Net Accounting Standards Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. On March 12, 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. |
Acquisition (Tables)
Acquisition (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Pagatelia S.L | |
Summary of Final Allocation of Purchase Consideration | The allocation of the preliminary purchase consideration is summarized as follows: ($ in thousands) Assets acquired Cash $ 1,086 Other assets 5,047 Trademark 771 Customer relationships 5,946 Developed technology 4,624 Non-compete agreements 440 Goodwill 17,528 Total assets acquired 35,442 Liabilities assumed Accounts payable and accrued expenses 6,045 Deferred tax liability 2,801 Total liabilities assumed 8,846 Total purchase price $ 26,596 |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
Summary of Accounts Receivable, Net and Activity in Allowance for Credit Loss by Portfolio Segment | The following presents by portfolio segment Accounts receivable, net and the activity in the A llowance for credit loss for the three months ended March 31, 2020 : ($ in thousands) Commercial Services (Driver-billed) (1) Commercial Services (All other) Government Solutions Total Accounts Receivable, Net at January 1, 2020 (2) $ 9,793 $ 51,158 $ 31,744 $ 92,695 Allowance for credit loss at January 1, 2020 (2) $ 5,733 $ 945 $ 1,778 $ 8,456 Credit loss expense 1,925 2,731 700 5,356 Write-offs, net of recoveries (2,220 ) (311 ) (435 ) (2,966 ) Allowance for credit loss at March 31, 2020 $ 5,438 $ 3,365 $ 2,043 $ 10,846 Accounts Receivable, Net at March 31, 2020 $ 9,430 $ 50,898 $ 49,511 $ 109,839 (1) (2) This includes |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Prepaid Expense And Other Assets Current [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following at: ($ in thousands) March 31, 2020 December 31, 2019 Prepaid tolls $ 11,002 $ 10,116 Prepaid services 5,327 5,201 Deposits 3,510 3,642 Prepaid computer maintenance 2,715 2,923 Prepaid insurance 1,033 1,485 Photo enforcement equipment held for sale 416 1,410 Prepaid income taxes 162 1,025 Other 451 689 Total prepaid expenses and other current assets $ 24,616 $ 26,491 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill by Reportable Segment | The following table presents the changes in the carrying amount of goodwill by reportable segment: Commercial Government ($ in thousands) Services Solutions Total Balance at December 31, 2019 $ 424,404 $ 159,746 $ 584,150 Foreign currency translation adjustment (2,420 ) — (2,420 ) Balance at March 31, 2020 $ 421,984 $ 159,746 $ 581,730 |
Schedule of Intangible Assets of Respective Period Ends | Intangible assets consist of the following as of the respective period-ends: March 31, 2020 December 31, 2019 Weighted Weighted Average Gross Average Gross Remaining Carrying Accumulated Remaining Carrying Accumulated ($ in thousands) Useful Life Amount Amortization Useful Life Amount Amortization Trademarks 1.2 years $ 32,071 $ 21,651 1.5 years $ 32,127 $ 19,106 Non-compete agreements 2.8 years 62,553 27,977 3.0 years 62,549 24,834 Customer relationships 6.6 years 365,463 92,951 6.9 years 366,533 82,903 Developed technology 3.1 years 165,525 73,076 3.3 years 165,708 65,631 Gross carrying value of intangible assets 625,612 $ 215,655 626,917 $ 192,474 Less: accumulated amortization (215,655 ) (192,474 ) Intangible assets, net $ 409,957 $ 434,443 |
Estimated Amortization Expense in Future Years | Estimated amortization expense in future years is expected to be: ($ in thousands) Remainder of 2020 $ 70,276 2021 85,416 2022 80,686 2023 52,171 2024 41,684 Thereafter 79,724 Total $ 409,957 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Payables And Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following at: ($ in thousands) March 31, 2020 December 31, 2019 Accrued salaries and wages $ 5,282 $ 10,319 Current portion of related party TRA liability 4,636 5,730 Current portion of operating lease liabilities 2,987 2,970 Advanced deposits payable 2,322 2,875 Income taxes payable 4,675 348 Restricted cash due to customers 1,510 917 Accrued sales commissions 551 612 Accrued interest payable 176 210 Other 1,562 1,296 Total accrued liabilities $ 23,701 $ 25,277 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Summary of the Company's Long-Term Debt | The following table provides a summary of the Company’s long-term debt at: ($ in thousands) March 31, 2020 December 31, 2019 First Lien Term Loan, due February 28, 2025 $ 872,470 $ 894,421 Less: original issue discounts (4,648 ) (4,778 ) Less: unamortized deferred financing costs (23,211 ) (23,178 ) Total debt 844,611 866,465 Less: current portion of long-term debt (9,104 ) (28,779 ) Total long-term debt, net of current portion $ 835,507 $ 837,686 |
Schedule of Consolidated First Lien Net Leverage Ratio and Applicable Prepayment Percentage | In addition, the First Lien Term Loan requires mandatory prepayments equal to the product of the excess cash flows of the Company (as defined in the loan agreement) and the applicable prepayment percentages (calculated as of the last day of the fiscal year, beginning with the year ending December 31, 2019), as set forth in the following table: Consolidated first lien net leverage ratio (as defined by the First Lien Term Loan agreement) Applicable prepayment percentage > 3.70:1.00 50% < 25% < 0% |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Carrying Value and Fair Value of Debt | The carrying value and fair value of debt is as follows: Level in March 31, 2020 December 31, 2019 Fair Value Carrying Estimated Carrying Estimated ($ in thousands) Hierarchy Amount Fair Value Amount Fair Value Total debt 2 $ 844,611 $ 811,397 $ 866,465 $ 905,601 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Components of Basic and Diluted Net Income Per Share | The components of basic and diluted net income per share are as follows: Three Months Ended March 31, (In thousands, except per share data) 2020 2019 Numerator: Net income $ 6,673 $ 2,820 Denominator: Weighted average shares - basic 160,924 156,057 Common stock equivalents 3,503 401 Weighted average shares - diluted 164,427 156,458 Net income per share - basic $ 0.04 $ 0.02 Net income per share - diluted $ 0.04 $ 0.02 Antidilutive weighted average shares excluded from diluted net income per share: Contingently issuable shares (1) 5,742 10,000 Warrants — 20,000 Non-qualified stock options 209 — Performance share units 35 — Restricted stock units 28 86 Total antidilutive shares excluded 6,014 30,086 (1) Related Party Transactions |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Components of Stock Based Compensation Expense | The following details the components of stock-based compensation for the periods presented: Three Months Ended March 31, ($ in thousands) 2020 2019 Operating expenses $ 220 $ 204 Selling, general and administrative expenses 2,548 1,939 Total stock-based compensation expense $ 2,768 $ 2,143 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Summary of Earn Out Shares Issued by Company to Platinum Stockholder | The Earn-Out Shares are issued by the Company to the Platinum Stockholder as follows: Common Stock Price thresholds One-time issuance of shares > $13.00 (a) 2,500,000 > $15.50 (a) 2,500,000 > $18.00 2,500,000 > $20.50 2,500,000 (a) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Financial Information by Segment | The following tables set forth financial information by segment for the three months ended March 31, 2020 and March 31, 2019, respectively: For the Three Months Ended March 31, 2020 Commercial Government Corporate ($ in thousands) Services Solutions and Other Total Service revenue $ 61,242 $ 38,255 $ — $ 99,497 Product sales — 17,216 — 17,216 Total revenue 61,242 55,471 — 116,713 Cost of service revenue 807 412 — 1,219 Cost of product sales — 8,690 — 8,690 Operating expenses 16,530 15,509 — 32,039 Selling, general and administrative expenses 13,384 9,669 285 23,338 Other income, net (2,889 ) (36 ) — (2,925 ) Segment profit (loss) $ 33,410 $ 21,227 $ (285 ) $ 54,352 Segment profit (loss) $ 33,410 $ 21,227 $ (285 ) $ 54,352 Depreciation and amortization — — 29,250 29,250 Gain on disposal of assets, net — (4 ) — (4 ) Stock-based compensation — — 2,768 2,768 Interest expense, net — — 12,451 12,451 Income (loss) before income tax provision $ 33,410 $ 21,231 $ (44,754 ) $ 9,887 For the Three Months Ended March 31, 2019 Commercial Government Corporate ($ in thousands) Services Solutions and Other Total Service revenue $ 62,588 $ 35,482 $ — $ 98,070 Product sales — 391 — 391 Total revenue 62,588 35,873 — 98,461 Cost of service revenue 864 525 — 1,389 Cost of product sales — 276 — 276 Operating expenses 15,096 14,038 — 29,134 Selling, general and administrative expenses 10,762 7,850 — 18,612 Other income, net (2,171 ) (37 ) 1 (2,207 ) Segment profit (loss) $ 38,037 $ 13,221 $ (1 ) $ 51,257 Segment profit (loss) $ 38,037 $ 13,221 $ (1 ) $ 51,257 Depreciation and amortization — — 28,939 28,939 Loss on disposal of assets, net — — 2 2 Stock-based compensation — — 2,143 2,143 Interest expense, net — — 16,033 16,033 Income (loss) before income tax provision $ 38,037 $ 13,221 $ (47,118 ) $ 4,140 |
Guarantor_Non-Guarantor Finan_2
Guarantor/Non-Guarantor Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | |
Summary of Condensed Consolidated Balance Sheets | Verra Mobility Corporation and Subsidiaries Condensed Consolidated Balance Sheets at March 31, 2020 (Unaudited) ($ in thousands) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Assets Current assets: Cash and cash equivalents $ — $ 96,623 $ 16,960 $ — $ 113,583 Restricted cash — 1,510 — — 1,510 Accounts receivable (net of allowance for credit loss of $10.8 million ) — 105,799 4,040 — 109,839 Unbilled receivables — 16,071 287 — 16,358 Investment in subsidiary 175,141 75,098 — (250,239 ) — Prepaid expenses and other current assets — 22,116 2,500 — 24,616 Total current assets 175,141 317,217 23,787 (250,239 ) 265,906 Installation and service parts, net — 8,022 — — 8,022 Property and equipment, net — 70,588 3,043 — 73,631 Operating lease assets — 31,387 402 — 31,789 Intangible assets, net — 382,654 27,303 — 409,957 Goodwill — 524,767 56,963 — 581,730 Due from affiliates 169,259 — (169,259 ) — Other non-current assets — 3,080 14 — 3,094 Total assets $ 344,400 $ 1,337,715 $ 111,512 $ (419,498 ) $ 1,374,129 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ — $ 26,071 $ 13,127 $ — $ 39,198 Accrued liabilities — 20,580 3,121 — 23,701 Current portion of long-term debt — 9,104 — — 9,104 Total current liabilities — 55,755 16,248 — 72,003 Long-term debt, net of current portion and deferred financing costs — 835,507 — — 835,507 Operating lease liabilities, net of current portion — 29,712 205 — 29,917 Payable to related party pursuant to tax receivable agreement — 61,174 — — 61,174 Due to affiliates — 154,091 15,168 (169,259 ) — Asset retirement obligation — 6,387 — — 6,387 Deferred tax liabilities, net — 19,679 4,793 — 24,472 Other long-term liabilities — 269 — — 269 Total liabilities — 1,162,574 36,414 (169,259 ) 1,029,729 Total stockholders' equity 344,400 175,141 75,098 (250,239 ) 344,400 Total liabilities and stockholders' equity $ 344,400 $ 1,337,715 $ 111,512 $ (419,498 ) $ 1,374,129 |
Summary of Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) | Verra Mobility Corporation and Subsidiaries Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) Three Months Ended March 31, 2020 (Unaudited) ($ in thousands) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Service revenue $ — $ 95,650 $ 3,847 $ — $ 99,497 Product sales — 17,216 — — 17,216 Total revenue — 112,866 3,847 — 116,713 Cost of service revenue — 667 552 — 1,219 Cost of product sales — 8,690 — — 8,690 Operating expenses — 30,578 1,681 — 32,259 Selling, general and administrative expenses — 23,976 1,910 — 25,886 Depreciation, amortization and (gain) loss on disposal of assets, net — 27,995 1,251 — 29,246 Total costs and expenses — 91,906 5,394 — 97,300 Income (loss) from operations — 20,960 (1,547 ) — 19,413 (Income) loss from equity investment (6,673 ) 1,307 — 5,366 — Interest expense, net — 12,462 (11 ) — 12,451 Other income, net — (2,887 ) (38 ) — (2,925 ) Total other (income) expenses (6,673 ) 10,882 (49 ) 5,366 9,526 Income before income tax provision (benefit) 6,673 10,078 (1,498 ) (5,366 ) 9,887 Income tax provision (benefit) — 3,405 (191 ) — 3,214 Net income (loss) $ 6,673 $ 6,673 $ (1,307 ) $ (5,366 ) $ 6,673 Other comprehensive loss: Change in foreign currency translation adjustment — (3,367 ) — — (3,367 ) Total comprehensive income (loss) $ 6,673 $ 3,306 $ (1,307 ) $ (5,366 ) $ 3,306 |
Summary of Condensed Consolidated Statements of Cash Flows | Verra Mobility Corporation and Subsidiaries Condensed Consolidated Statements of Cash Flows Three Months Ended March 31, 2020 (Unaudited) ($ in thousands) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Cash Flows from Operating Activities: Net income (loss) $ 6,673 $ 6,673 $ (1,307 ) $ (5,366 ) $ 6,673 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization — 27,999 1,251 — 29,250 Amortization of deferred financing costs and discounts — 903 — — 903 Credit loss expense — 5,356 — — 5,356 Deferred income taxes — (94 ) (588 ) — (682 ) Stock-based compensation — 2,768 — — 2,768 Installation and service parts expense — 393 — — 393 Accretion expense — 64 — — 64 Gain on disposal of assets — (4 ) — — (4 ) (Income) loss from equity investment (6,673 ) 1,307 — 5,366 — Changes in operating assets and liabilities: Accounts receivable, net — (23,028 ) 631 — (22,397 ) Unbilled receivables — 3,246 402 — 3,648 Prepaid expenses and other current assets — 2,628 (261 ) — 2,367 Accounts payable and accrued liabilities — (10,444 ) (919 ) — (11,363 ) Due to affiliates — (1,341 ) 1,341 — — Other liabilities — (2,135 ) — — (2,135 ) Net cash provided by operating activities — 14,291 550 — 14,841 Cash Flows from Investing Activities: Purchases of installation and service parts and property and equipment — (7,370 ) (771 ) — (8,141 ) Cash proceeds from the sale of assets — 10 — — 10 Net cash used in investing activities — (7,360 ) (771 ) — (8,131 ) Cash Flows from Financing Activities: Repayment of long-term debt — (21,951 ) — — (21,951 ) Payment of debt issuance costs — (806 ) — — (806 ) Payment of employee tax withholding related to RSU vesting — (327 ) — — (327 ) Net cash used in financing activities — (23,084 ) — — (23,084 ) Effect of exchange rate changes on cash and cash equivalents — — (963 ) — (963 ) Net decrease in cash, cash equivalents and restricted cash — (16,153 ) (1,184 ) — (17,337 ) Cash, cash equivalents and restricted cash - beginning of period — 114,286 18,144 — 132,430 Cash, cash equivalents and restricted cash - end of period $ — $ 98,133 $ 16,960 $ — $ 115,093 Verra Mobility Corporation and Subsidiaries Condensed Consolidated Statements of Cash Flows (Continued) Three Months Ended March 31, 2020 (Unaudited) Verra Mobility Corporation (Ultimate Parent) VM Consolidated Inc. (Guarantor Subsidiary) Non- guarantor Subsidiaries Eliminations Consolidated Supplemental cash flow information: Interest paid $ — $ 11,822 $ — $ — $ 11,822 Income taxes paid, net — 156 163 — 319 Supplemental non-cash investing and financing activities: Earn-out shares issued to Platinum Stockholder 18,287 — — — 18,287 Additions to ARO, property and equipment, and other — 22 — — 22 Purchases of installation and service parts and property and equipment in accounts payable and accrued liabilities at period-end — 4,586 — — 4,586 |
Description of Business - Addit
Description of Business - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2020Segment | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of operating segments | 2 |
Significant Accounting Polici_3
Significant Accounting Policies - Additional Information (Details) $ in Millions | Jan. 01, 2020USD ($) |
Accounting Standards Update 2016-13 | |
Summary Of Significant Accounting Principles And Policies [Line Items] | |
Adjustment to accumulated deficit | $ 0.7 |
Acquisition - Additional Inform
Acquisition - Additional Information (Details) - Pagatelia S.L $ in Millions | Oct. 31, 2019USD ($) |
Business Acquisition [Line Items] | |
Purchase price | $ 26.6 |
Trademarks | |
Business Acquisition [Line Items] | |
Identifiable intangible assets useful life | 8 years 6 months |
Customer Relationships | |
Business Acquisition [Line Items] | |
Identifiable intangible assets useful life | 9 years 6 months |
Developed Technology | |
Business Acquisition [Line Items] | |
Identifiable intangible assets useful life | 6 years 6 months |
Non-compete Agreements | |
Business Acquisition [Line Items] | |
Identifiable intangible assets useful life | 3 years |
Acquisition - Summary of Fair V
Acquisition - Summary of Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Oct. 31, 2019 |
Assets acquired | |||
Goodwill | $ 581,730 | $ 584,150 | |
Pagatelia S.L | |||
Assets acquired | |||
Cash | $ 1,086 | ||
Other assets | 5,047 | ||
Goodwill | 17,528 | ||
Total assets acquired | 35,442 | ||
Liabilities assumed | |||
Accounts payable and accrued expenses | 6,045 | ||
Deferred tax liability | 2,801 | ||
Total liabilities assumed | 8,846 | ||
Total purchase price | 26,596 | ||
Trademarks | Pagatelia S.L | |||
Assets acquired | |||
Intangible assets | 771 | ||
Customer Relationships | Pagatelia S.L | |||
Assets acquired | |||
Intangible assets | 5,946 | ||
Developed Technology | Pagatelia S.L | |||
Assets acquired | |||
Intangible assets | 4,624 | ||
Non-compete Agreements | Pagatelia S.L | |||
Assets acquired | |||
Intangible assets | $ 440 |
Accounts Receivable, Net - Summ
Accounts Receivable, Net - Summary of Accounts Receivable, Net and Activity in Allowance for Credit Loss by Portfolio Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accounts Notes And Loans Receivable [Line Items] | ||
Accounts Receivable, Net, beginning balance | $ 92,695 | |
Allowance for credit loss, beginning balance | 8,456 | |
Credit loss expense | 5,356 | $ 1,270 |
Write-offs, net of recoveries | (2,966) | |
Allowance for credit loss, ending balance | 10,846 | |
Accounts Receivable, Net, ending balance | 109,839 | |
Commercial Services (Driver Billed) | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Accounts Receivable, Net, beginning balance | 9,793 | |
Allowance for credit loss, beginning balance | 5,733 | |
Credit loss expense | 1,925 | |
Write-offs, net of recoveries | (2,220) | |
Allowance for credit loss, ending balance | 5,438 | |
Accounts Receivable, Net, ending balance | 9,430 | |
Commercial Services (All Other) | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Accounts Receivable, Net, beginning balance | 51,158 | |
Allowance for credit loss, beginning balance | 945 | |
Credit loss expense | 2,731 | |
Write-offs, net of recoveries | (311) | |
Allowance for credit loss, ending balance | 3,365 | |
Accounts Receivable, Net, ending balance | 50,898 | |
Government Solutions | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Accounts Receivable, Net, beginning balance | 31,744 | |
Allowance for credit loss, beginning balance | 1,778 | |
Credit loss expense | 700 | |
Write-offs, net of recoveries | (435) | |
Allowance for credit loss, ending balance | 2,043 | |
Accounts Receivable, Net, ending balance | $ 49,511 |
Accounts Receivable, Net - Su_2
Accounts Receivable, Net - Summary of Accounts Receivable, Net and Activity in Allowance for Credit Loss by Portfolio Segment (Parenthetical) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Allowance For Doubtful Accounts Receivable Rollforward | |
Allowance for credit loss increase | $ 0.8 |
Accounts Receivable, Net - Addi
Accounts Receivable, Net - Additional Information (Details) - Sales Revenue - Customer Concentration Risk | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Government Solutions | City of New York Department of Transportation | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Concentration risk percentage | 25.50% | |
Commercial Services | Hertz Corporation | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Concentration risk percentage | 15.70% | 18.40% |
Commercial Services | Avis Budget Group Inc | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Concentration risk percentage | 12.70% | 0.00% |
Commercial Services | Enterprise Holdings Inc | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Concentration risk percentage | 10.80% | 14.00% |
Minimum | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Concentration risk percentage | 10.00% |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Prepaid Expense And Other Assets Current [Abstract] | ||
Prepaid tolls | $ 11,002 | $ 10,116 |
Prepaid services | 5,327 | 5,201 |
Deposits | 3,510 | 3,642 |
Prepaid computer maintenance | 2,715 | 2,923 |
Prepaid insurance | 1,033 | 1,485 |
Photo enforcement equipment held for sale | 416 | 1,410 |
Prepaid income taxes | 162 | 1,025 |
Other | 451 | 689 |
Total prepaid expenses and other current assets | $ 24,616 | $ 26,491 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Changes in Carrying Amount of Goodwill by Reportable Segment (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill [Line Items] | |
Balance | $ 584,150 |
Foreign currency translation adjustment | (2,420) |
Balance | 581,730 |
Commercial Services | |
Goodwill [Line Items] | |
Balance | 424,404 |
Foreign currency translation adjustment | (2,420) |
Balance | 421,984 |
Government Solutions | |
Goodwill [Line Items] | |
Balance | 159,746 |
Balance | $ 159,746 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Gross Carrying Amount and Accumulated Amortization of Separately Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 625,612 | $ 626,917 |
Accumulated Amortization | 215,655 | 192,474 |
Less: accumulated amortization | (215,655) | (192,474) |
Intangible assets, net | $ 409,957 | $ 434,443 |
Trademarks | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 1 year 2 months 12 days | 1 year 6 months |
Gross Carrying Amount | $ 32,071 | $ 32,127 |
Accumulated Amortization | 21,651 | 19,106 |
Less: accumulated amortization | $ (21,651) | $ (19,106) |
Non-compete Agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 2 years 9 months 18 days | 3 years |
Gross Carrying Amount | $ 62,553 | $ 62,549 |
Accumulated Amortization | 27,977 | 24,834 |
Less: accumulated amortization | $ (27,977) | $ (24,834) |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 6 years 7 months 6 days | 6 years 10 months 24 days |
Gross Carrying Amount | $ 365,463 | $ 366,533 |
Accumulated Amortization | 92,951 | 82,903 |
Less: accumulated amortization | $ (92,951) | $ (82,903) |
Developed Technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 3 years 1 month 6 days | 3 years 3 months 18 days |
Gross Carrying Amount | $ 165,525 | $ 165,708 |
Accumulated Amortization | 73,076 | 65,631 |
Less: accumulated amortization | $ (73,076) | $ (65,631) |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 23.5 | $ 23.1 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Estimated Amortization Expense in Future Years (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Remainder of 2020 | $ 70,276 |
2021 | 85,416 |
2022 | 80,686 |
2023 | 52,171 |
2024 | 41,684 |
Thereafter | 79,724 |
Total | $ 409,957 |
Accrued Liabilities - Schedule
Accrued Liabilities - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Payables And Accruals [Abstract] | ||
Accrued salaries and wages | $ 5,282 | $ 10,319 |
Current portion of related party TRA liability | 4,636 | 5,730 |
Current portion of operating lease liabilities | 2,987 | 2,970 |
Advanced deposits payable | 2,322 | 2,875 |
Income taxes payable | 4,675 | 348 |
Restricted cash due to customers | 1,510 | 917 |
Accrued sales commissions | 551 | 612 |
Accrued interest payable | 176 | 210 |
Other | 1,562 | 1,296 |
Total accrued liabilities | $ 23,701 | $ 25,277 |
Debt - Summary of the Company's
Debt - Summary of the Company's Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Disclosure [Abstract] | ||
First Lien Term Loan, due February 28, 2025 | $ 872,470 | $ 894,421 |
Less: original issue discounts | (4,648) | (4,778) |
Less: unamortized deferred financing costs | (23,211) | (23,178) |
Total debt | 844,611 | 866,465 |
Less: current portion of long-term debt | (9,104) | (28,779) |
Long-term debt, net of current portion and deferred financing costs | $ 835,507 | $ 837,686 |
Debt - Summary of the Company_2
Debt - Summary of the Company's Long-Term Debt (Parenthetical) (Details) | 3 Months Ended |
Mar. 31, 2020 | |
First Lien Term Loan, Due February 28, 2025 | |
Debt Instrument [Line Items] | |
Debt instrument, maturity date | Feb. 28, 2025 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Feb. 20, 2020 | Oct. 17, 2018 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Jul. 31, 2018 |
Debt Instrument [Line Items] | ||||||
Debt Instrument, interest rate | 0.50% | 1.38% | ||||
Outstanding letters of credit | $ 6,200,000 | |||||
Debt instrument, periodic payment, interest rate | 0.375% | |||||
Debt instrument fronting fees | $ 6,200,000 | |||||
Interest expense including amortization of deferred financing costs and discounts | $ 12,500,000 | $ 16,000,000 | ||||
Weighted average effective interest rates | 4.24% | 5.50% | ||||
First Lien Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, interest rate during the period | 1.00% | |||||
Debt instrument, maturity date | Feb. 28, 2025 | |||||
Debt instrument interest rate | 4.24% | |||||
Debt instrument fee amount | $ 800,000 | |||||
Debt instrument legal fees | $ 200,000 | |||||
First Lien Term Loan | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 3.25% | |||||
First Lien Term Loan | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 2.25% | |||||
Revolver | ||||||
Debt Instrument [Line Items] | ||||||
Mandatory prepayment of excess cash flow under loan agreement | $ 19,700,000 | |||||
Outstanding borrowings | 0 | |||||
Debt instrument borrow under new revolver | 68,800,000 | |||||
Outstanding letters of credit | $ 6,200,000 | |||||
Revolver | LIBOR 1.25% | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 1.25% | |||||
Revolver | LIBOR 1.50% | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 1.50% | |||||
Revolver | LIBOR 1.75% | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 1.75% | |||||
Revolver | Base Rate 0.25% | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 0.25% | |||||
Revolver | Base Rate 0.50% | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 0.50% | |||||
Revolver | Base Rate 0.75% | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate per annum | 0.75% | |||||
2018 Credit Facilities | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding borrowings | $ 1,115,000,000 | |||||
Debt instrument, aggregate principal amount | 1,040,000,000 | |||||
Aggregate revolving commitment | $ 75,000,000 | |||||
2018 Credit Facilities | Second Lien Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 200,000,000 | |||||
Additional repayments of lines of credit | $ 70,000,000 | |||||
2018 Credit Facilities | Minimum | First Lien Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 840,000,000 | |||||
2018 Credit Facilities | Maximum | First Lien Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 910,000,000 |
Debt - Schedule of Consolidated
Debt - Schedule of Consolidated First Lien Net Leverage Ratio and Applicable Prepayment Percentage (Details) - First Lien Term Loan | 3 Months Ended |
Mar. 31, 2020 | |
> 3.70:1.00 | |
Debt Instrument [Line Items] | |
Applicable prepayment percentage | 50.00% |
≤ 3.70:1.00 and > 3.20:1.00 | |
Debt Instrument [Line Items] | |
Applicable prepayment percentage | 25.00% |
≤ 3.20:1.00 | |
Debt Instrument [Line Items] | |
Applicable prepayment percentage | 0.00% |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Carrying Value and Fair Value of Debt (Details) - Level 2 - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Carrying Amount | ||
Debt Instrument [Line Items] | ||
Total debt | $ 844,611 | $ 866,465 |
Estimated Fair Value | ||
Debt Instrument [Line Items] | ||
Total debt | $ 811,397 | $ 905,601 |
Net Income Per Share - Schedule
Net Income Per Share - Schedule of Components of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Numerator: | ||
Net income | $ 6,673 | $ 2,820 |
Weighted average shares used in per share calculation: | ||
Weighted average shares - basic | 160,924 | 156,057 |
Common stock equivalents | 3,503 | 401 |
Weighted average shares - diluted | 164,427 | 156,458 |
Net income per share - basic | $ 0.04 | $ 0.02 |
Net income per share - diluted | $ 0.04 | $ 0.02 |
Antidilutive weighted average shares excluded from diluted net income per share: | ||
Total antidilutive shares excluded | 6,014 | 30,086 |
Contingently Issuable Shares | ||
Antidilutive weighted average shares excluded from diluted net income per share: | ||
Total antidilutive shares excluded | 5,742 | 10,000 |
Warrants | ||
Antidilutive weighted average shares excluded from diluted net income per share: | ||
Total antidilutive shares excluded | 20,000 | |
Non-qualified Stock Options | ||
Antidilutive weighted average shares excluded from diluted net income per share: | ||
Total antidilutive shares excluded | 209 | |
Performance Share Units | ||
Antidilutive weighted average shares excluded from diluted net income per share: | ||
Total antidilutive shares excluded | 35 | |
Restricted Stock Units | ||
Antidilutive weighted average shares excluded from diluted net income per share: | ||
Total antidilutive shares excluded | 28 | 86 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax [Line Items] | ||
Effective tax rate | 32.50% | 31.90% |
Unrecognized tax benefits decreased from prior tax positions | $ 900,000 | |
Unrecognized tax benefits | 800,000 | |
Unrecognized tax benefits, if recognized | $ 700,000 | |
Earliest | Internal Revenue Service | ||
Income Tax [Line Items] | ||
Income Tax Examination, Year under Examination | 2016 | |
Earliest | Certain States | ||
Income Tax [Line Items] | ||
Income Tax Examination, Year under Examination | 2015 | |
Earliest | Other States | ||
Income Tax [Line Items] | ||
Income Tax Examination, Year under Examination | 2014 | |
Latest | Internal Revenue Service | ||
Income Tax [Line Items] | ||
Income Tax Examination, Year under Examination | 2019 | |
Latest | Certain States | ||
Income Tax [Line Items] | ||
Income Tax Examination, Year under Examination | 2017 | |
Latest | Other States | ||
Income Tax [Line Items] | ||
Income Tax Examination, Year under Examination | 2019 | |
Maximum | ||
Income Tax [Line Items] | ||
Accrued interest and penalties | $ 100,000 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Components of Stock Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | $ 2,768 | $ 2,143 |
Operating Expenses | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | 220 | 204 |
Selling, General and Administrative Expenses | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Total stock-based compensation expense | $ 2,548 | $ 1,939 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) $ / shares in Units, $ in Thousands | Jan. 27, 2020USD ($)$ / shares | Apr. 26, 2019$ / shares | Mar. 31, 2020USD ($)yr$ / sharesshares | Dec. 31, 2019USD ($) | Oct. 01, 2018USD ($) |
Related Party Transaction [Line Items] | |||||
Estimated maximum benefit to be paid to tax receivable agreement | $ 61,174 | $ 61,174 | |||
Platinum Stockholder | Common Stock Price Greater than $13.00 and $15.50 | |||||
Related Party Transaction [Line Items] | |||||
Earn-out shares issuable if condition met | shares | 5,000,000 | ||||
Platinum Stockholder | Common Stock Price Greater than $13.00 and $15.50 | Common Stock Including Additional Paid in Capital | |||||
Related Party Transaction [Line Items] | |||||
Earn-out shares issued value | $ 36,600 | ||||
Platinum Stockholder | Common Stock Price Greater than $13.00 | |||||
Related Party Transaction [Line Items] | |||||
Common stock price | $ / shares | $ 13 | ||||
Platinum Stockholder | Common Stock Price Greater than $15.50 | |||||
Related Party Transaction [Line Items] | |||||
Common stock price | $ / shares | $ 15.50 | ||||
Platinum Stockholder | Earn-Out Agreement | Earn-Out Scenario Five | |||||
Related Party Transaction [Line Items] | |||||
Earn-out shares issuable if condition met | shares | 0 | ||||
Platinum Stockholder | Earn-Out Agreement | Common Stock Price Greater than $13.00 | |||||
Related Party Transaction [Line Items] | |||||
Earn-out shares issuable if condition met | shares | 2,500,000 | ||||
Common stock price | $ / shares | $ 13 | ||||
Platinum Stockholder | Earn-Out Agreement | Common Stock Price Greater than $15.50 | |||||
Related Party Transaction [Line Items] | |||||
Earn-out shares issuable if condition met | shares | 2,500,000 | ||||
Common stock price | $ / shares | $ 15.50 | ||||
Minimum | Platinum Stockholder | Common Stock Price Greater than $13.00 | |||||
Related Party Transaction [Line Items] | |||||
Common stock price threshold trading days | 10 days | ||||
Minimum | Platinum Stockholder | Common Stock Price Greater than $15.50 | |||||
Related Party Transaction [Line Items] | |||||
Common stock price threshold trading days | 10 days | ||||
Maximum | Platinum Stockholder | Common Stock Price Greater than $13.00 | |||||
Related Party Transaction [Line Items] | |||||
Common stock price threshold trading days | 20 days | ||||
Maximum | Platinum Stockholder | Common Stock Price Greater than $15.50 | |||||
Related Party Transaction [Line Items] | |||||
Common stock price threshold trading days | 20 days | ||||
Maximum | Platinum Stockholder | Earn-Out Agreement | |||||
Related Party Transaction [Line Items] | |||||
Earn-out shares issuable if condition met | shares | 10,000,000 | ||||
Verra Mobility Business Combination | |||||
Related Party Transaction [Line Items] | |||||
Tax Receivable Agreement, portion of net cash savings paid out | 50.00% | ||||
Tax Receivable Agreement, portion of net cash savings retained | 50.00% | ||||
Estimated maximum benefit to be paid to tax receivable agreement | $ 70,000 | ||||
Tax receivable agreement, amount payable | $ 65,800 | ||||
Contingency period | 5 years | ||||
Verra Mobility Business Combination | Platinum Stockholder | Earn-Out Agreement | |||||
Related Party Transaction [Line Items] | |||||
Contingent consideration | $ 73,150 | ||||
Term of volatility and risk free rates utilizing a peer group | yr | 5 | ||||
Verra Mobility Business Combination | Minimum | |||||
Related Party Transaction [Line Items] | |||||
Common stock price threshold trading days | 10 days | ||||
Verra Mobility Business Combination | Maximum | |||||
Related Party Transaction [Line Items] | |||||
Common stock price threshold trading days | 20 days | ||||
Verra Mobility Business Combination | Accrued Liabilities | |||||
Related Party Transaction [Line Items] | |||||
Tax receivable agreement, amount payable | $ 4,600 | ||||
Verra Mobility Business Combination | Payable Related to Tax Receivable Agreement | |||||
Related Party Transaction [Line Items] | |||||
Tax receivable agreement, amount payable | $ 61,200 |
Related Party Transactions - Su
Related Party Transactions - Summary of Earn Out Shares Issued by Company to Platinum Stockholder (Details) - Platinum Stockholder - $ / shares | 3 Months Ended | ||
Mar. 31, 2020 | Jan. 27, 2020 | Apr. 26, 2019 | |
Common Stock Price Greater than $13.00 | |||
Related Party Transaction [Line Items] | |||
Common Stock Price thresholds | $ 13 | ||
Common Stock Price Greater than $13.00 | Earn-Out Agreement | |||
Related Party Transaction [Line Items] | |||
Common Stock Price thresholds | $ 13 | ||
One-time issuance of shares | 2,500,000 | ||
Common Stock Price Greater than $15.50 | |||
Related Party Transaction [Line Items] | |||
Common Stock Price thresholds | $ 15.50 | ||
Common Stock Price Greater than $15.50 | Earn-Out Agreement | |||
Related Party Transaction [Line Items] | |||
Common Stock Price thresholds | $ 15.50 | ||
One-time issuance of shares | 2,500,000 | ||
Common Stock Price Greater than $18.00 | Earn-Out Agreement | |||
Related Party Transaction [Line Items] | |||
Common Stock Price thresholds | $ 18 | ||
One-time issuance of shares | 2,500,000 | ||
Common Stock Price Greater than $20.50 | Earn-Out Agreement | |||
Related Party Transaction [Line Items] | |||
Common Stock Price thresholds | $ 20.50 | ||
One-time issuance of shares | 2,500,000 |
Commitment and Contingencies -
Commitment and Contingencies - Additional Information (Details) $ in Millions | Mar. 31, 2020USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
Letters of Credit Outstanding | $ 6.2 |
Non-cancelable purchase commitments outstanding | $ 27.4 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2020Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 2 |
Number of reportable segments | 2 |
Segment Reporting - Financial I
Segment Reporting - Financial Information by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Segment Reporting Information [Line Items] | ||
Total revenue | $ 116,713 | $ 98,461 |
Operating expenses | 32,039 | 29,134 |
Selling, general and administrative expenses | 23,338 | 18,612 |
Other income, net | (2,925) | (2,207) |
Segment profit (loss) | 19,413 | 17,966 |
Depreciation and amortization | 29,250 | 28,939 |
Gain (Loss) on disposal of assets, net | (4) | 2 |
Stock-based compensation | 2,768 | 2,143 |
Interest expense, net | 12,451 | 16,033 |
Income (loss) before income tax provision | 9,887 | 4,140 |
Service Revenue | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 99,497 | 98,070 |
Cost of revenue | 1,219 | 1,389 |
Product Sales | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 17,216 | 391 |
Cost of revenue | 8,690 | 276 |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Segment profit (loss) | 54,352 | 51,257 |
Operating Segments | Commercial Services | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 61,242 | 62,588 |
Operating expenses | 16,530 | 15,096 |
Selling, general and administrative expenses | 13,384 | 10,762 |
Other income, net | (2,889) | (2,171) |
Segment profit (loss) | 33,410 | 38,037 |
Income (loss) before income tax provision | 33,410 | 38,037 |
Operating Segments | Government Solutions | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 55,471 | 35,873 |
Operating expenses | 15,509 | 14,038 |
Selling, general and administrative expenses | 9,669 | 7,850 |
Other income, net | (36) | (37) |
Segment profit (loss) | 21,227 | 13,221 |
Gain (Loss) on disposal of assets, net | (4) | |
Income (loss) before income tax provision | 21,231 | 13,221 |
Operating Segments | Service Revenue | Commercial Services | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 61,242 | 62,588 |
Cost of revenue | 807 | 864 |
Operating Segments | Service Revenue | Government Solutions | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 38,255 | 35,482 |
Cost of revenue | 412 | 525 |
Operating Segments | Product Sales | Government Solutions | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 17,216 | 391 |
Cost of revenue | 8,690 | 276 |
Corporate and Other | ||
Segment Reporting Information [Line Items] | ||
Selling, general and administrative expenses | 285 | |
Other income, net | 1 | |
Segment profit (loss) | (285) | (1) |
Depreciation and amortization | 29,250 | 28,939 |
Gain (Loss) on disposal of assets, net | 2 | |
Stock-based compensation | 2,768 | 2,143 |
Interest expense, net | 12,451 | 16,033 |
Income (loss) before income tax provision | $ (44,754) | $ (47,118) |
Guarantor_Non-Guarantor Finan_3
Guarantor/Non-Guarantor Financial Information - Summary of Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||||
Cash and cash equivalents | $ 113,583 | $ 131,513 | ||
Restricted cash | 1,510 | 917 | ||
Accounts receivable (net of allowance for credit loss of $10.8 million at March 31, 2020) | 109,839 | 93,514 | ||
Unbilled receivables | 16,358 | 20,003 | ||
Prepaid expenses and other current assets | 24,616 | 26,491 | ||
Total current assets | 265,906 | 272,438 | ||
Installation and service parts, net | 8,022 | 8,841 | ||
Property and equipment, net | 73,631 | 72,266 | ||
Operating lease assets | 31,789 | 32,177 | ||
Intangible assets, net | 409,957 | 434,443 | ||
Goodwill | 581,730 | 584,150 | ||
Other non-current assets | 3,094 | 3,111 | ||
Total assets | 1,374,129 | 1,407,426 | ||
Current liabilities: | ||||
Accounts payable | 39,198 | 50,825 | ||
Accrued liabilities | 23,701 | 25,277 | ||
Current portion of long-term debt | 9,104 | 28,779 | ||
Total current liabilities | 72,003 | 104,881 | ||
Long-term debt, net of current portion and deferred financing costs | 835,507 | |||
Operating lease liabilities, net of current portion | 29,917 | 30,130 | ||
Payable to related party pursuant to tax receivable agreement | 61,174 | 61,174 | ||
Asset retirement obligation | 6,387 | 6,309 | ||
Deferred tax liabilities, net | 24,472 | 25,716 | ||
Other long-term liabilities | 269 | |||
Total liabilities | 1,029,729 | 1,068,079 | ||
Total stockholders' equity | 344,400 | 339,347 | $ 304,821 | $ 302,056 |
Total liabilities and stockholders' equity | 1,374,129 | $ 1,407,426 | ||
Verra Mobility Corporation (Ultimate Parent) | ||||
Current assets: | ||||
Investment in subsidiary | 175,141 | |||
Total current assets | 175,141 | |||
Due from affiliates | 169,259 | |||
Total assets | 344,400 | |||
Current liabilities: | ||||
Total stockholders' equity | 344,400 | |||
Total liabilities and stockholders' equity | 344,400 | |||
VM Consolidated Inc. (Guarantor Subsidiary) | ||||
Current assets: | ||||
Cash and cash equivalents | 96,623 | |||
Restricted cash | 1,510 | |||
Accounts receivable (net of allowance for credit loss of $10.8 million at March 31, 2020) | 105,799 | |||
Unbilled receivables | 16,071 | |||
Investment in subsidiary | 75,098 | |||
Prepaid expenses and other current assets | 22,116 | |||
Total current assets | 317,217 | |||
Installation and service parts, net | 8,022 | |||
Property and equipment, net | 70,588 | |||
Operating lease assets | 31,387 | |||
Intangible assets, net | 382,654 | |||
Goodwill | 524,767 | |||
Other non-current assets | 3,080 | |||
Total assets | 1,337,715 | |||
Current liabilities: | ||||
Accounts payable | 26,071 | |||
Accrued liabilities | 20,580 | |||
Current portion of long-term debt | 9,104 | |||
Total current liabilities | 55,755 | |||
Long-term debt, net of current portion and deferred financing costs | 835,507 | |||
Operating lease liabilities, net of current portion | 29,712 | |||
Payable to related party pursuant to tax receivable agreement | 61,174 | |||
Due to affiliates | 154,091 | |||
Asset retirement obligation | 6,387 | |||
Deferred tax liabilities, net | 19,679 | |||
Other long-term liabilities | 269 | |||
Total liabilities | 1,162,574 | |||
Total stockholders' equity | 175,141 | |||
Total liabilities and stockholders' equity | 1,337,715 | |||
Non-guarantor Subsidiaries | ||||
Current assets: | ||||
Cash and cash equivalents | 16,960 | |||
Accounts receivable (net of allowance for credit loss of $10.8 million at March 31, 2020) | 4,040 | |||
Unbilled receivables | 287 | |||
Prepaid expenses and other current assets | 2,500 | |||
Total current assets | 23,787 | |||
Property and equipment, net | 3,043 | |||
Operating lease assets | 402 | |||
Intangible assets, net | 27,303 | |||
Goodwill | 56,963 | |||
Other non-current assets | 14 | |||
Total assets | 111,512 | |||
Current liabilities: | ||||
Accounts payable | 13,127 | |||
Accrued liabilities | 3,121 | |||
Total current liabilities | 16,248 | |||
Operating lease liabilities, net of current portion | 205 | |||
Due to affiliates | 15,168 | |||
Deferred tax liabilities, net | 4,793 | |||
Total liabilities | 36,414 | |||
Total stockholders' equity | 75,098 | |||
Total liabilities and stockholders' equity | 111,512 | |||
Eliminations | ||||
Current assets: | ||||
Investment in subsidiary | (250,239) | |||
Total current assets | (250,239) | |||
Due from affiliates | (169,259) | |||
Total assets | (419,498) | |||
Current liabilities: | ||||
Due to affiliates | (169,259) | |||
Total liabilities | (169,259) | |||
Total stockholders' equity | (250,239) | |||
Total liabilities and stockholders' equity | $ (419,498) |
Guarantor_Non-Guarantor Finan_4
Guarantor/Non-Guarantor Financial Information - Summary of Condensed Consolidated Balance Sheets (Parenthetical) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | ||
Allowance for credit loss | $ 10,846 | $ 8,456 |
Guarantor_Non-Guarantor Finan_5
Guarantor/Non-Guarantor Financial Information - Summary of Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | $ 116,713 | $ 98,461 |
Operating expenses | 32,259 | 29,338 |
Selling, general and administrative expenses | 25,886 | 20,551 |
Depreciation, amortization and (gain) loss on disposal of assets, net | 29,246 | 28,941 |
Total costs and expenses | 97,300 | 80,495 |
Income from operations | 19,413 | 17,966 |
Interest expense, net | 12,451 | 16,033 |
Other income, net | (2,925) | (2,207) |
Total other (income) expenses | 9,526 | 13,826 |
Income before income tax provision (benefit) | 9,887 | 4,140 |
Income tax provision (benefit) | 3,214 | 1,320 |
Net income (loss) | 6,673 | 2,820 |
Other comprehensive loss: | ||
Change in foreign currency translation adjustment | (3,367) | 1,324 |
Total comprehensive income (loss) | 3,306 | 4,144 |
Verra Mobility Corporation (Ultimate Parent) | ||
Condensed Statement Of Income Captions [Line Items] | ||
(Income) loss from equity investment | (6,673) | |
Total other (income) expenses | (6,673) | |
Income before income tax provision (benefit) | 6,673 | |
Net income (loss) | 6,673 | |
Other comprehensive loss: | ||
Total comprehensive income (loss) | 6,673 | |
VM Consolidated Inc. (Guarantor Subsidiary) | ||
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | 112,866 | |
Operating expenses | 30,578 | |
Selling, general and administrative expenses | 23,976 | |
Depreciation, amortization and (gain) loss on disposal of assets, net | 27,995 | |
Total costs and expenses | 91,906 | |
Income from operations | 20,960 | |
(Income) loss from equity investment | 1,307 | |
Interest expense, net | 12,462 | |
Other income, net | (2,887) | |
Total other (income) expenses | 10,882 | |
Income before income tax provision (benefit) | 10,078 | |
Income tax provision (benefit) | 3,405 | |
Net income (loss) | 6,673 | |
Other comprehensive loss: | ||
Change in foreign currency translation adjustment | (3,367) | |
Total comprehensive income (loss) | 3,306 | |
Non-guarantor Subsidiaries | ||
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | 3,847 | |
Operating expenses | 1,681 | |
Selling, general and administrative expenses | 1,910 | |
Depreciation, amortization and (gain) loss on disposal of assets, net | 1,251 | |
Total costs and expenses | 5,394 | |
Income from operations | (1,547) | |
Interest expense, net | (11) | |
Other income, net | (38) | |
Total other (income) expenses | (49) | |
Income before income tax provision (benefit) | (1,498) | |
Income tax provision (benefit) | (191) | |
Net income (loss) | (1,307) | |
Other comprehensive loss: | ||
Total comprehensive income (loss) | (1,307) | |
Eliminations | ||
Condensed Statement Of Income Captions [Line Items] | ||
(Income) loss from equity investment | 5,366 | |
Total other (income) expenses | 5,366 | |
Income before income tax provision (benefit) | (5,366) | |
Net income (loss) | (5,366) | |
Other comprehensive loss: | ||
Total comprehensive income (loss) | (5,366) | |
Service Revenue | ||
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | 99,497 | 98,070 |
Cost of revenue | 1,219 | 1,389 |
Service Revenue | VM Consolidated Inc. (Guarantor Subsidiary) | ||
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | 95,650 | |
Cost of revenue | 667 | |
Service Revenue | Non-guarantor Subsidiaries | ||
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | 3,847 | |
Cost of revenue | 552 | |
Product Sales | ||
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | 17,216 | 391 |
Cost of revenue | 8,690 | $ 276 |
Product Sales | VM Consolidated Inc. (Guarantor Subsidiary) | ||
Condensed Statement Of Income Captions [Line Items] | ||
Total revenue | 17,216 | |
Cost of revenue | $ 8,690 |
Guarantor_Non-Guarantor Finan_6
Guarantor/Non-Guarantor Financial Information - Summary of Condensed Consolidated Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net income (loss) | $ 6,673 | $ 2,820 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 29,250 | 28,939 |
Amortization of deferred financing costs and discounts | 903 | |
Credit loss expense | 5,356 | 1,270 |
Deferred income taxes | (682) | (1,073) |
Stock-based compensation | 2,768 | 2,143 |
Installation and service parts expense | 393 | 257 |
Accretion expense | 64 | 90 |
Gain on disposal of assets | (4) | 2 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (22,397) | (8,372) |
Unbilled receivables | 3,648 | (3,797) |
Prepaid expenses and other current assets | 2,367 | (1,527) |
Accounts payable and accrued liabilities | (11,363) | 18,413 |
Other liabilities | (2,135) | (3,647) |
Net cash provided by operating activities | 14,841 | 37,351 |
Cash Flows from Investing Activities: | ||
Purchases of installation and service parts and property and equipment | (8,141) | (9,219) |
Cash proceeds from the sale of assets | 10 | |
Net cash used in investing activities | (8,131) | (9,167) |
Cash Flows from Financing Activities: | ||
Repayment of long-term debt | (21,951) | (2,276) |
Payment of debt issuance costs | (806) | (37) |
Payment of employee tax withholding related to RSU vesting | (327) | |
Net cash used in financing activities | (23,084) | (2,313) |
Effect of exchange rate changes on cash and cash equivalents | (963) | |
Net (decrease) increase in cash, cash equivalents and restricted cash | (17,337) | 26,107 |
Cash, cash equivalents and restricted cash - beginning of period | 132,430 | 67,081 |
Cash, cash equivalents and restricted cash - end of period | 115,093 | 93,188 |
Supplemental cash flow information: | ||
Interest paid | 11,822 | 13,890 |
Income taxes paid, net | 319 | (4,710) |
Supplemental non-cash investing and financing activities: | ||
Earn-out shares issued to Platinum Stockholder | 18,287 | |
Additions to ARO, property and equipment, and other | 22 | 28 |
Purchases of installation and service parts and property and equipment in accounts payable and accrued liabilities at period-end | 4,586 | $ 4,084 |
Verra Mobility Corporation (Ultimate Parent) | ||
Cash Flows from Operating Activities: | ||
Net income (loss) | 6,673 | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
(Income) loss from equity investment | (6,673) | |
Supplemental non-cash investing and financing activities: | ||
Earn-out shares issued to Platinum Stockholder | 18,287 | |
VM Consolidated Inc. (Guarantor Subsidiary) | ||
Cash Flows from Operating Activities: | ||
Net income (loss) | 6,673 | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 27,999 | |
Amortization of deferred financing costs and discounts | 903 | |
Credit loss expense | 5,356 | |
Deferred income taxes | (94) | |
Stock-based compensation | 2,768 | |
Installation and service parts expense | 393 | |
Accretion expense | 64 | |
Gain on disposal of assets | (4) | |
(Income) loss from equity investment | 1,307 | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (23,028) | |
Unbilled receivables | 3,246 | |
Prepaid expenses and other current assets | 2,628 | |
Accounts payable and accrued liabilities | (10,444) | |
Due to affiliates | (1,341) | |
Other liabilities | (2,135) | |
Net cash provided by operating activities | 14,291 | |
Cash Flows from Investing Activities: | ||
Purchases of installation and service parts and property and equipment | (7,370) | |
Cash proceeds from the sale of assets | 10 | |
Net cash used in investing activities | (7,360) | |
Cash Flows from Financing Activities: | ||
Repayment of long-term debt | (21,951) | |
Payment of debt issuance costs | (806) | |
Payment of employee tax withholding related to RSU vesting | (327) | |
Net cash used in financing activities | (23,084) | |
Net (decrease) increase in cash, cash equivalents and restricted cash | (16,153) | |
Cash, cash equivalents and restricted cash - beginning of period | 114,286 | |
Cash, cash equivalents and restricted cash - end of period | 98,133 | |
Supplemental cash flow information: | ||
Interest paid | 11,822 | |
Income taxes paid, net | 156 | |
Supplemental non-cash investing and financing activities: | ||
Additions to ARO, property and equipment, and other | 22 | |
Purchases of installation and service parts and property and equipment in accounts payable and accrued liabilities at period-end | 4,586 | |
Non-guarantor Subsidiaries | ||
Cash Flows from Operating Activities: | ||
Net income (loss) | (1,307) | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 1,251 | |
Deferred income taxes | (588) | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 631 | |
Unbilled receivables | 402 | |
Prepaid expenses and other current assets | (261) | |
Accounts payable and accrued liabilities | (919) | |
Due to affiliates | 1,341 | |
Net cash provided by operating activities | 550 | |
Cash Flows from Investing Activities: | ||
Purchases of installation and service parts and property and equipment | (771) | |
Net cash used in investing activities | (771) | |
Cash Flows from Financing Activities: | ||
Effect of exchange rate changes on cash and cash equivalents | (963) | |
Net (decrease) increase in cash, cash equivalents and restricted cash | (1,184) | |
Cash, cash equivalents and restricted cash - beginning of period | 18,144 | |
Cash, cash equivalents and restricted cash - end of period | 16,960 | |
Supplemental cash flow information: | ||
Income taxes paid, net | 163 | |
Eliminations | ||
Cash Flows from Operating Activities: | ||
Net income (loss) | (5,366) | |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
(Income) loss from equity investment | $ 5,366 |