Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 01, 2021 | Jun. 30, 2020 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38186 | ||
Entity Registrant Name | Nesco Holdings, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 84-2531628 | ||
Entity Address, Address Line One | 6714 Pointe Inverness Way | ||
Entity Address, Address Line Two | Suite 220 | ||
Entity Address, City or Town | Fort Wayne | ||
Entity Address, State or Province | IN | ||
Entity Address, Postal Zip Code | 46804 | ||
City Area Code | 800 | ||
Local Phone Number | 252-0043 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 59.5 | ||
Entity Common Stock, Shares Outstanding | 49,156,753 | ||
Documents Incorporated by Reference | None | ||
Entity Central Index Key | 0001709682 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Common Stock | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Common Stock, $0.0001 par value | ||
Trading Symbol | NSCO | ||
Security Exchange Name | NYSE | ||
Redeemable Warrants | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Redeemable warrants, exercisable for Common Stock, $0.0001 par value | ||
Trading Symbol | NSCO.WS | ||
Security Exchange Name | NYSE |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current Assets | ||
Cash | $ 3,412 | $ 6,302 |
Accounts receivable, net of allowance of $6,372 and $4,654, respectively | 60,933 | 71,323 |
Inventory | 31,367 | 33,001 |
Prepaid expenses and other | 7,530 | 5,217 |
Total current assets | 103,242 | 115,843 |
Property and equipment, net | 6,269 | 6,561 |
Rental equipment, net | 335,812 | 383,420 |
Goodwill and other intangible assets, net | 305,631 | 308,747 |
Deferred income taxes | 16,952 | 0 |
Notes receivable | 498 | 713 |
Total assets | 768,404 | 815,284 |
Current Liabilities | ||
Accounts payable | 31,829 | 41,172 |
Accrued expenses | 31,991 | 27,590 |
Deferred rent income | 975 | 2,270 |
Current maturities of long-term debt | 1,280 | 1,280 |
Current portion of capital lease obligations | 5,276 | 5,451 |
Total current liabilities | 71,351 | 77,763 |
Long term debt, net | 715,858 | 713,023 |
Capital leases | 5,250 | 22,631 |
Deferred income taxes | 0 | 12,288 |
Interest rate collar | 7,012 | 1,709 |
Total long-term liabilities | 728,120 | 749,651 |
Commitments and contingencies (see Note 9) | ||
Stockholders' Deficit | ||
Common stock - $0.0001 par value, 250,000,000 shares authorized, 49,156,753 and 49,033,903 issued and outstanding, at December 31, 2020 and 2019, respectively | 5 | 5 |
Additional paid-in capital | 434,917 | 432,577 |
Accumulated deficit | (465,989) | (444,712) |
Total stockholders' deficit | (31,067) | (12,130) |
Total Liabilities and Stockholders' Deficit | $ 768,404 | $ 815,284 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | |||||
Allowance for accounts receivable | $ 6,372 | $ 4,654 | $ 7,562 | $ 4,404 | |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |||
Common stock, authorized (in shares) | 250,000,000 | 250,000,000 | |||
Common stock, issued (in shares) | 49,156,753 | 49,033,903 | 49,033,903 | ||
Common stock, outstanding (in shares) | 49,156,753 | 49,033,903 | 49,033,903 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue | |||
Rental revenue | $ 302,739 | $ 264,035 | $ 246,297 |
Cost of revenue | |||
Cost of rental revenue | 147,764 | 106,919 | 100,586 |
Depreciation of rental equipment | 78,532 | 70,568 | 64,093 |
Total cost of revenue | 226,296 | 177,487 | 164,679 |
Gross profit | 76,443 | 86,548 | 81,618 |
Operating expenses | |||
Selling, general, and administrative | 43,464 | 34,667 | 32,718 |
Licensing and titling | 2,945 | 2,617 | 2,241 |
Amortization and non-rental depreciation | 3,248 | 3,122 | 3,045 |
Transaction expenses | 6,627 | 7,641 | 440 |
Asset impairment | 0 | 657 | 0 |
Other operating expenses | 2,911 | 1,826 | 10 |
Total operating expenses | 59,195 | 50,530 | 38,454 |
Operating income | 17,248 | 36,018 | 43,164 |
Other expense | |||
Loss on extinguishment of debt | 0 | 4,005 | 0 |
Interest expense, net | 63,200 | 63,361 | 56,698 |
Other expense, net | 5,399 | 1,690 | 287 |
Total other expense | 68,599 | 69,056 | 56,985 |
Loss before income taxes | (51,351) | (33,038) | (13,821) |
Income tax expense (benefit) | (30,074) | (5,986) | 1,705 |
Net Loss | $ (21,277) | $ (27,052) | $ (15,526) |
Loss per share: | |||
Basic and diluted (USD per share) | $ (0.43) | $ (0.82) | $ (0.72) |
Weighted-average common shares outstanding: | |||
Basic and diluted (USD per share) | 49,064,615 | 33,066,165 | 21,660,638 |
Rental revenue | |||
Revenue | |||
Rental revenue | $ 195,490 | $ 197,996 | $ 184,563 |
Cost of revenue | |||
Cost of rental revenue | 59,030 | 50,829 | 49,023 |
Rental Equipment | |||
Revenue | |||
Rental revenue | 31,533 | 23,767 | 26,019 |
Cost of revenue | |||
Cost of rental revenue | 25,615 | 20,302 | 21,689 |
New Equipment | |||
Revenue | |||
Rental revenue | 25,099 | 10,308 | 18,349 |
Cost of revenue | |||
Cost of rental revenue | 21,792 | 8,520 | 16,099 |
Parts sales and services | |||
Revenue | |||
Rental revenue | 50,617 | 31,964 | 17,366 |
Cost of revenue | |||
Cost of rental revenue | 39,150 | 25,052 | 12,339 |
Major repair disposals | |||
Cost of revenue | |||
Cost of rental revenue | $ 2,177 | $ 2,216 | $ 1,436 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Jul. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||||
Net Loss | $ (16,064) | $ (10,988) | $ (21,277) | $ (27,052) | $ (15,526) |
Other comprehensive loss: | |||||
Interest rate collar (net of taxes of $285 in 2019) | 0 | 396 | (396) | ||
Other comprehensive loss | 0 | 396 | (396) | ||
Comprehensive loss | $ (21,277) | $ (26,656) | $ (15,922) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Loss (Parentheticals) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Interest rate collar, taxes | $ 285,000 | ||
Reclassification from accumulated other comprehensive loss | $ 0 | 800,000 | $ 0 |
Reclassification from accumulated other comprehensive loss, taxes | $ 300,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating activities | |||
Net loss | $ (21,277) | $ (27,052) | $ (15,526) |
Adjustments to reconcile net loss to net cash flow from operating activities: | |||
Depreciation | 79,559 | 71,548 | 64,312 |
Amortization - intangibles | 3,153 | 3,008 | 2,826 |
Amortization - financing costs | 3,290 | 2,913 | 3,537 |
Provision for losses on accounts receivable | 3,765 | 3,292 | 4,302 |
Share-based payments | 2,357 | 1,014 | 1,130 |
Gain on sale of equipment - rental fleet | (7,215) | (5,542) | (3,644) |
Gain on insurance proceeds - damaged equipment | (781) | (538) | 0 |
Major repair disposals | 2,177 | 2,216 | 1,436 |
Loss on extinguishment of debt | 0 | 4,005 | 0 |
Change in fair value of derivative | 5,303 | 1,709 | 0 |
Asset impairment | 0 | 657 | 0 |
Deferred tax (benefit) expense | (28,810) | (6,861) | 1,096 |
Changes in assets and liabilities: | |||
Accounts receivable | 7,061 | (17,073) | (5,185) |
Inventory | (9,642) | (22,683) | (8,023) |
Prepaid expenses and other | (2,313) | (2,578) | 351 |
Accounts payable | 3,113 | 7,547 | (4,307) |
Accrued expenses and other liabilities | 4,384 | 6,560 | (1,203) |
Unearned income | (1,295) | (3,350) | (62) |
Net cash flow from operating activities | 42,829 | 18,792 | 41,040 |
Investing Activities | |||
Cash paid for business acquisition, net of cash required | 0 | (48,425) | (1,524) |
Purchase of equipment - rental fleet | (67,546) | (106,641) | (58,519) |
Proceeds from sale of equipment and parts | 34,923 | 26,794 | 33,321 |
Insurance proceeds from damaged equipment | 4,010 | 1,658 | 0 |
Purchase of property and equipment | (874) | (3,065) | (716) |
Other | 173 | 0 | 0 |
Net cash flow from investing activities | (29,314) | (129,679) | (27,438) |
Financing activities | |||
Proceeds from issuance of long-term debt | 0 | 475,000 | 0 |
Borrowings under revolving credit facilities | 86,178 | 313,000 | 49,000 |
Repayments under revolving credit facilities | (85,208) | (272,000) | (50,000) |
Repayments of notes payable | (1,146) | (527,531) | (1,658) |
Capital lease payments | (15,950) | (5,201) | (8,119) |
Proceeds from merger and recapitalization | 0 | 147,269 | 0 |
Finance fees paid | (279) | (15,488) | (1,645) |
Net cash flow from financing activities | (16,405) | 115,049 | (12,422) |
Net Change in Cash | (2,890) | 4,162 | 1,180 |
Cash at Beginning of Period | 6,302 | 2,140 | 960 |
Cash at End of Period | 3,412 | 6,302 | 2,140 |
Supplemental Cash Flow Information | |||
Cash paid for interest | 60,340 | 53,595 | 53,763 |
Cash paid for income taxes | 646 | 455 | 526 |
Non-Cash Investing and Financing Activities: | |||
Transfer of inventory to rental equipment | 10,851 | 5,804 | 6,014 |
Rental equipment and property and equipment purchases in accounts payable | 9,122 | 21,643 | 10,712 |
Rental equipment sales in accounts receivable | 5,120 | 4,684 | 2,750 |
Extinguishment of capital lease obligations | 1,608 | 0 | 0 |
Purchases of rental equipment under capital leases | 0 | 0 | 15,388 |
Customer note receivable | 0 | 972 | 0 |
Settlement of note payable with common stock | 0 | 25,000 | 0 |
Acquisition | $ 0 | $ 0 | $ 3,546 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholder's Deficit - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Balance (in shares) at Dec. 31, 2017 | 21,660,638 | ||||
Balance at Dec. 31, 2017 | $ (143,964) | $ 2 | $ 258,168 | $ (402,134) | $ 0 |
Increase (Decrease) in Stockholders' Deficit [Roll Forward] | |||||
Net loss | (15,526) | (15,526) | |||
Share-based payments | 1,130 | 1,130 | |||
Interest rate collar | (396) | (396) | |||
Balance (in shares) at Dec. 31, 2018 | 21,660,638 | ||||
Balance at Dec. 31, 2018 | (158,756) | $ 2 | 259,298 | (417,660) | (396) |
Increase (Decrease) in Stockholders' Deficit [Roll Forward] | |||||
Net loss | $ (10,988) | (10,988) | |||
Balance (in shares) at Jul. 31, 2019 | 49,033,903 | ||||
Balance (in shares) at Dec. 31, 2018 | 21,660,638 | ||||
Balance at Dec. 31, 2018 | $ (158,756) | $ 2 | 259,298 | (417,660) | (396) |
Increase (Decrease) in Stockholders' Deficit [Roll Forward] | |||||
Net loss | (27,052) | ||||
Reverse capitalization (in shares) | 27,373,265 | ||||
Reverse capitalization | 172,268 | $ 3 | 172,265 | ||
Share-based payments | 1,014 | 1,014 | |||
Interest rate collar | $ 396 | 396 | |||
Balance (in shares) at Dec. 31, 2019 | 49,033,903 | 49,033,903 | |||
Balance at Dec. 31, 2019 | $ (12,130) | $ 5 | 432,577 | (444,712) | 0 |
Balance (in shares) at Jul. 31, 2019 | 49,033,903 | ||||
Increase (Decrease) in Stockholders' Deficit [Roll Forward] | |||||
Net loss | $ (16,064) | (16,064) | |||
Balance (in shares) at Dec. 31, 2019 | 49,033,903 | 49,033,903 | |||
Balance at Dec. 31, 2019 | $ (12,130) | $ 5 | 432,577 | (444,712) | 0 |
Increase (Decrease) in Stockholders' Deficit [Roll Forward] | |||||
Net loss | (21,277) | (21,277) | |||
Share-based payments (in shares) | 122,850 | ||||
Share-based payments | $ 2,340 | 2,340 | |||
Balance (in shares) at Dec. 31, 2020 | 49,156,753 | 49,156,753 | |||
Balance at Dec. 31, 2020 | $ (31,067) | $ 5 | $ 434,917 | $ (465,989) | $ 0 |
Business and Organization
Business and Organization | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Organization | Note 1: Business and Organization Organization Nesco Holdings, Inc. (“Holdings”), a Delaware corporation, serves as the parent for our primary operating company, NESCO, LLC. NESCO, LLC, an Indiana limited liability company, and its wholly owned subsidiaries (collectively, “we,” “our,” “us,” “Nesco,” or the “Company”), is engaged in the business of providing a range of services and products to customers through rentals of specialty equipment, sales of parts related to the specialty equipment, and repair, maintenance and upfit services related to that equipment. Holdings’ wholly-owned subsidiaries include NESCO Holdings I, Inc. (which was the ultimate parent holding company prior to the transaction described below) (“Holdings I”), NESCO Finance Corporation, a Delaware corporation, NESCO Investments, LLC, a Delaware limited liability company, NESCO International, LLC, a Delaware limited liability company, and El Alquiler S. de R.L. de C.V., an operating company in Mexico. We are a specialty equipment rental provider to the electric utility T&D, telecommunications and rail industries in North America. We own a fleet of specialty rental equipment that is utilized by service providers in infrastructure improvement work. Specifically, we offer our specialized equipment to a diverse customer base, including utilities and contractors, for the maintenance, repair, upgrade and installation of critical infrastructure assets, including electric lines, telecommunications networks and rail systems, as well as for lighting and signage. We rent and sell a broad range of new and used equipment, including bucket trucks, digger derricks, line equipment, cranes, pressure diggers, and underground equipment, which forms our Equipment Rental and Sales (“ERS”) segment. We also provide a one-stop shop for customers to purchase or rent parts, tools, and accessories as well as upfitting and servicing new and used heavy-duty trucks and cranes. These activities form our Parts, Tools and Accessories (“PTA”) segment. We are positioned to serve all 50 U.S. states and 13 Canadian provinces and territories via our network of over 50 locations in the United States and Canada. Merger with Capitol Investment Corp. IV On April 7, 2019, Holdings I entered into a definitive agreement (as amended, the “Merger Agreement”) with Capitol, a public investment vehicle, whereby the parties agreed to merge, resulting in the parent of Holdings I becoming a publicly listed company. This merger closed on July 31, 2019 (the “Merger”), which consummated as a result of the following (the “Transactions”): • Holders of 26,091,034 shares of Capitol Class A ordinary shares sold in its initial public offering exercised their rights to convert those shares to cash at a conversion price of $10.24 per share, or an aggregate of approximately $267.2 million. The per share conversion price of $10.24 for holders of public shares electing conversion was paid out of Capitol’s trust account, which had a balance immediately prior to the closing of approximately $412.3 million. Concurrently, NESCO Holdings, LP, a Delaware limited partnership controlled by Energy Capital Partners (“Nesco Owner”) and the sole shareholder of Holdings I, purchased 4,500,000 newly-issued shares of common stock at a price of $10.00 per share in exchange for a combination of cash and full repayment of certain outstanding indebtedness, and the founders of Capitol (the “Capitol Sponsors”) purchased in aggregate 1,000,000 newly-issued shares of common stock at a price of $10.00 per share, paid in cash (see Note 11). • Of the remaining funds in the trust account and amounts from the sale of the newly-issued common stock described above: (i) approximately $17.8 million was used to pay Capitol’s transaction expenses, (ii) $127.8 million was used to pay down Nesco’s debt, and (iii) the balance of approximately $10.2 million was released to Nesco to be used to pay certain of Nesco’s transaction-related costs. The amount remaining (after deducting direct equity issuance costs of $10.0 million) from the combination of the trust account funds and consideration received from Nesco Owner and the Capitol Sponsors discussed above, of $172.3 million was reflected as contributed capital in the Company’s Consolidated Statements of Stockholders’ Deficit in the Year ended December 31, 2019. • In connection with the Merger, Capitol became Holdings by domesticating from the Cayman Islands as a corporation formed under the laws of the State of Delaware named Nesco Holdings, Inc. • Immediately after giving effect to the Transactions (including as a result of the conversions described above and certain forfeitures of Capitol common stock and warrants immediately prior to the closing), there were 49,033,903 shares of common stock issued and outstanding, which excludes the additional shares that Nesco Owner may be entitled to as further described below. Additionally, there were warrants to purchase 20,949,980 shares of common stock issued and outstanding. • Upon the closing, Capitol’s common stock, warrants and units ceased trading, and upon the opening of trading on August 1, 2019, Holdings’ common stock and warrants began trading on the NYSE, respectively, under the symbol “NSCO” and NSCO WS, respectively. • Upon the completion of the Transactions, NESCO Holdings, LP, a Delaware limited partnership controlled by Nesco Owner, and certain members of management of the Company received 21,660,638 shares of Holdings and warrants to purchase 2,500,000 shares of Holdings’ common stock, in exchange for all of the share capital. Nesco Owner also obtained the right to receive up to 3,451,798 additional common shares of the Company upon the occurrence of certain events. The Merger was treated as the equivalent of Holdings I issuing stock for the net assets of Capitol. Consistent with SEC Topic 12, Reverse Acquisitions and Reverse Recapitalizations , the acquisition of a private operating company by a non-operating public shell corporation typically results in the owners and management of the private company having actual or effective voting control and operating control of the combined company. Therefore, the transaction is, in substance, a reverse recapitalization, equivalent to the issuance of stock by the private company for the net monetary assets of the shell corporation accompanied by a recapitalization. The accounting is similar to that of a reverse acquisition, except that no goodwill or other intangible assets should be recorded. Therefore, the net assets of Capitol as of July 31, 2019, were stated at historical cost, and no goodwill or other intangible assets were recorded. COVID-19 During the on-going Coronavirus Disease 2019 ("COVID-19") pandemic, we have undertaken efforts intended to maintain the health and safety of our employees and their families and to ensure the Company's continued financial and operational viability, especially in relation to our position as a supplier to critical industries. Employees whose tasks can be completed offsite have been instructed to work from home. Our service locations remain operational, and we are maintaining social distancing and enhanced cleaning protocols and usage of personal protective equipment, where appropriate. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Polices | Note 2: Summary of Significant Accounting Policies Basis of Presentation Our accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) and the accounting policies described below. Our consolidated financial statements include the accounts of all wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates We prepare our consolidated financial statements in conformity with GAAP, which requires us to use judgment to make estimates that directly affect the amounts reported in our consolidated financial statements and accompanying notes. Significant estimates are used for items including, but not limited to, the useful lives and residual values of our rental equipment, business combinations and determining the valuation allowance related to deferred income taxes. In addition, estimates are used to test both long-lived assets, goodwill and indefinite-lived assets for impairment, and to determine the fair value of impaired assets, if any impairment exists. These estimates are based on our historical experience and on various other assumptions we believe to be reasonable under the circumstances. We review our estimates on an ongoing basis using information currently available, and we revise our recorded estimates as updated information becomes available, facts and circumstances change, or actual amounts become determinable. Actual results could differ from our estimates. Accounts Receivable, net of Allowance Accounts receivable are stated at invoiced amounts and are ordinarily due upon receipt of invoice. We record an allowance for doubtful accounts based on receivable aging. We also establish customer specific reserves for accounts with known collection problems due to insolvency, disputes, or other issues. Accounts more than 90 days past due are considered delinquent. Delinquent receivables are written off when the amount is deemed uncollectible based on individual credit evaluations and specific circumstances related to the customer. Bad debt expense is included in selling, general, and administrative expenses on our Consolidated Statements of Operations. As of December 31, accounts receivable, net of allowance consisted of the following: (in $000s) 2020 2019 Trade receivables $ 67,305 $ 75,977 Less: allowance for doubtful accounts (6,372) (4,654) Accounts receivable, net of allowance $ 60,933 $ 71,323 The relationship between bad debts expense and allowance for doubtful accounts is presented below: (in $000s) 2020 2019 2018 Allowance - beginning of period $ 4,654 $ 7,562 $ 4,404 Accounts written off during period (1,410) (6,208) (1,144) Recoveries (637) (701) (177) Bad debts expense 3,765 4,001 4,479 Allowance - end of period $ 6,372 $ 4,654 $ 7,562 Inventory Parts, tools and accessories inventory is primarily comprised of items purchased for resale or rent to customers. During the second quarter ended June 30, 2020, in connection with a new inventory management system, we elected to change our method for these inventories, which were previously valued using the first-in, first-out (“FIFO”) method, to the moving average cost method. We believe the change is preferable because it better reflects movement of the inventory and the corresponding value which provides a better reflection of periodic income from operations. This change was not applied retrospectively to prior periods, as the effect of the change was not material to our consolidated financial statements, including interim periods. Also included within parts, tools and accessories inventory are materials and components that we carry to service our rental fleet and new equipment held for sale. These materials and components are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. Equipment inventory consists of equipment bought specifically for resale to customers. These new purchases are recorded directly to inventory when received. Equipment inventory is stated at the lower of cost or net realizable value, with cost determined on a specific identification basis. As of December 31, inventory consisted of the following: (in $000s) 2020 2019 Parts, tools and accessories inventory $ 28,091 $ 30,174 Equipment inventory 3,276 2,827 Total inventory $ 31,367 $ 33,001 Property and Equipment Property and equipment is comprised of construction in progress, building improvements, machinery and equipment, and office equipment, and is carried at cost, net of accumulated depreciation. Depreciation of building improvements, machinery and equipment and office equipment is provided using the straight-line method based on useful lives ranging from three years to 15 years. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. Leasehold improvements are depreciated over the lesser of the improvement’s useful life or the remaining lease term. Depreciation expense related to non-rental property and equipment used in our rental operations was $0.8 million in 2020 ($0.9 million in 2019 and 2018) and is classified within “cost of rental revenue”. We include rental equipment inventory received that is purchased for deployment in our rental fleet, in property and equipment (construction in progress) when received. Following the completion of a quality inspection of a rental equipment unit, we reclassify the unit to rental equipment (see below). Rental Equipment Rental equipment is comprised of the cost of bucket trucks, digger derricks, line equipment, cranes, pressure diggers and underground equipment. The rental equipment we purchase is recorded at cost and depreciated over the estimated rentable life of the equipment using the straight-line method over a 7-year period to a 15% estimated residual value. Depreciation of rental equipment commences when a rental unit is placed into the rental fleet and becomes available to rent and the cost is depreciated whether or not the equipment is on rent. We reevaluate the estimated rentable life as rental equipment is purchased, estimating the period that the asset will be held, considering such factors as historical rental activity and expectations of future rental activity. We reevaluate the estimated residual values of the applicable rental equipment. The residual value of equipment is affected by factors that include equipment age and amount of usage. Market conditions for used equipment sales can also be affected by external factors such as the economy, natural disasters, fuel prices, supply of similar used equipment, the market price for similar new equipment and incentives offered by manufacturers of new equipment. These factors are considered when estimating future residual values and depreciation periods. Expenditures for repair and maintenance that extend the useful life of the equipment and are necessary to keep an equipment unit in rentable condition are capitalized and depreciated over the estimated remaining useful life of the equipment, which is the period the repair and maintenance is expected to provide future economic benefit. When making repairs, we dispose of damaged and replaced components at their net carrying values. The cost of these disposed components is expensed as major repairs expense in the Consolidated Statements of Operations. The cost of routine and recurring maintenance activities related to the rental fleet are charged to expense as incurred. Rental equipment also includes the cost of parts, tools, and accessories that are rented to customers. The cost of these parts, tools and accessories is depreciated over a five-year estimated rentable life to no residual value. Depreciation of rented parts, tools and accessories commences when the asset is placed on rent with a customer. Impairment of Long-Lived Assets, including Intangible Assets We evaluate the carrying value of long-lived assets held for use, including rental equipment and definite-lived intangible assets, for impairment whenever an event or circumstance has occurred (such as a significant adverse change in the business climate, operating performance metrics, or legal factors) which suggests that the carrying value may not be recoverable. Impairment of a long-lived asset held for use (or relative asset group, if applicable) is measured when the anticipated separately identifiable undiscounted cash flows from the asset are less than the carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value. Fair value is determined primarily using anticipated cash flows discounted at a rate commensurate with the risk involved. Other intangible assets consist of customer relationships, non-compete agreements and trade names. We amortize intangible assets with finite lives over the period the economic benefits are estimated to be consumed. Customer relationships are amortized using the straight-line method over their useful life, as we believe this method best matches the pattern of economic benefit. See Note 6, Goodwill and Other Intangible Assets , for additional information. Goodwill and Other Intangible Assets We recognize goodwill when the purchase price of an acquired business exceeds the fair value of net assets acquired. Goodwill is not amortized for financial reporting purposes. Goodwill is impaired when its carrying value exceeds its implied fair value. We perform our goodwill impairment analysis annually on October 1 or more frequently if an event or circumstance (such as a significant adverse change in the business climate, operating performance metrics, or legal factors) indicates that an impairment may have occurred. For our analysis conducted as of October 1, 2020, 2019 and 2018 we tested for impairment by comparing the estimated fair values of our reporting units to their carrying value, including goodwill. If the fair value of the reporting unit exceeds its carrying value, goodwill of the reporting unit is not considered impaired. If the carrying value of the reporting unit exceeds its fair value, then there is an indication impairment may exist. We estimate the fair value of our reporting units using an income approach based on the present value of estimated future cash flows. We believe this approach yields the most appropriate evidence of fair value. Determining the fair value of our reporting units is judgmental and involves the use of significant estimates and assumptions. We based our fair value estimates on assumptions that we believe are reasonable. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for our reporting units. Intangible assets with indefinite lives are not amortized but tested annually for impairment by comparing the carrying value of the asset to its fair value. We perform our impairment analysis on our intangible assets with indefinite lives annually on October 1 or more frequently if an event or circumstance indicates that an impairment loss may have occurred. See Note 6, Goodwill and Other Intangible Assets , for additional information. Deferred Financing Costs Direct costs incurred in connection with the issuance, and amendments thereto, of our debt are capitalized and amortized over the terms of the respective agreements using the effective interest method, or the straight-line method when not materially different than the effective interest method. The net carrying value of deferred financing costs are classified as a reduction to long-term debt in the Consolidated Balance Sheets (see Note 10). The amortization is included in interest expense on our Consolidated Statements of Operations. Derivatives Instruments Designated as Hedges When a derivative contract is entered into, the Company may designate the derivative instrument as a cash flow hedge of a forecasted transaction, a cash flow hedge of a recognized asset or liability or as an undesignated derivative. When a derivative is designated, the Company formally documents its hedge relationships, including identification of the derivative instruments and the hedged items, as well as its risk management objectives and strategies for undertaking the hedge transaction. This process includes linking derivative instruments that are designated as hedges to specific assets, liabilities or forecasted transactions. The fair market value of derivative instruments is determined through market-based valuations and may not be representative of the actual gains or losses that will be recorded when these instruments mature due to future fluctuations in the markets in which they are traded. The Company assesses at inception and at least quarterly thereafter, whether the derivatives used in cash flow hedging transactions are effective in offsetting the changes in the cash flows of the hedged item. To the extent the derivative is deemed to be an effective hedge, the fair market value changes of the instrument are recorded to accumulated other comprehensive income (loss) and subsequently reclassified into net income (loss) when the hedged transaction affects earnings. Changes in the fair market value of derivatives not deemed to be an effective hedge are recorded in the Consolidated Statements of Operations in the period of change. If the hedging relationship ceases to be effective subsequent to inception, or it becomes probable that a forecasted transaction is no longer expected to occur, the hedging relationship will be undesignated and any future gains and losses on the derivative instrument will be recorded in the Consolidated Statements of Operations. Fair Value Measurements Fair value is defined as an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. Fair value is a market-based measurement that is determined based on inputs, which refer broadly to assumptions that market participants use in pricing assets and liabilities. These inputs can be readily observable, market corroborated, or generally unobservable. Fair Value Hierarchy In measuring fair value, we use observable market data when available and minimize the use of unobservable inputs. Unobservable inputs may be required to value certain financial instruments due to complexities in contract terms. Inputs used in fair value measurements are categorized into three fair value hierarchy levels for disclosure purposes. The entire fair value measurement is categorized based on the lowest level of input that is significant to the fair value measurement. The three levels of the fair value hierarchy are: Level 1 Inputs that reflect unadjusted quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur with both sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 Inputs that reflect quoted prices for similar assets and liabilities are available in active markets, and inputs other than quoted prices that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments. Level 3 Inputs that are generally less observable or from unobservable sources in which there is little or no market data. These inputs may be used with internally developed methodologies that result in our best estimate of fair value. Valuation Techniques Assets and liabilities measured at fair value are based on one or more of the following three valuation techniques: Market approach Technique that uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. Income approach Technique that converts future amounts to a single present amount based upon market expectations (including present value techniques, option-pricing, and excess earnings models). Cost approach Technique that estimates the amount that would be required to replace the service capacity of an asset (i.e. replacement cost). Assets and Liabilities with Recurring Fair Value Measurements Certain assets and liabilities may be measured at fair value on an ongoing basis. We did not elect to apply the fair value option for recording financial assets and financial liabilities. Other than the interest rate collar, we do not have any assets or liabilities which we measure at fair value on a recurring basis. Assets and Liabilities with Nonrecurring Fair Value Measurements Certain assets and liabilities are not measured at fair value on an ongoing basis. These assets and liabilities, which include long-lived assets, goodwill, and intangible assets, are subject to fair value adjustment in certain circumstances. From time to time, the fair value is determined on these assets as part of related impairment tests. For certain assets and liabilities acquired in business combinations, we record the fair value as of the acquisition date. Refer to Note 4, Business Combinations, for the fair values of assets acquired and liabilities assumed in connection with our business combinations. Other than acquisition and impairment accounting adjustments, no adjustments to fair value or fair value measurements were required for non-financial assets and liabilities for all periods presented. See Note 6, Goodwill and Other Intangible Assets , and Note 7, Fair Value Measurements , for additional information. Accrued Expenses As of December 31, accrued expenses consisted of the following: (in $000s) 2020 2019 Accrued interest $ 20,478 $ 20,629 Accrued salaries, wages and benefits 3,176 4,164 Accrued sales taxes 1,703 1,444 Other, including transaction expenses 6,634 1,353 Total accrued expenses $ 31,991 $ 27,590 Revenue Recognition We recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 840, which addresses lease accounting, for which we will adopt an update to this standard using the full retrospective approach, as described herein. For the years ended December 31, 2020, 2019 and 2018, we recognized rental revenue in accordance with Topic 840 Leases, which is the lease accounting standard. Under Topic 606, revenue from contracts with customers is measured based on the consideration specified in the contract with the customer, and excludes any sales incentives and amounts collected on behalf of third parties. A “performance obligation” is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under Topic 606. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. The amount of revenue recognized reflects the consideration we expect to be entitled to in exchange for such products or services. As reflected below, most of our revenue is accounted for under Topic 840. Our contracts with customers generally do not include multiple performance obligations. The table below presents our revenue types based on the accounting standard used to determine the accounting. Rental revenue is primarily comprised of revenues from rental agreements including freight charges billed to customers, as well as charges to customers for damaged equipment. Year Ended December 31, 2020 (in $000s) Topic 840 Topic 606 Total Rental: Rental revenue $ 187,522 $ — $ 187,522 Shipping and handling — 7,968 7,968 Total rental revenue 187,522 7,968 195,490 Sales and services: Sales of rental equipment — 31,533 31,533 Sales of new equipment — 25,099 25,099 Parts and services — 50,617 50,617 Total sales and services — 107,249 107,249 Total revenue $ 187,522 $ 115,217 $ 302,739 Year Ended December 31, 2019 (in $000s) Topic 840 Topic 606 Total Rental: Rental revenue $ 189,161 $ — $ 189,161 Shipping and handling — 8,835 8,835 Total rental revenue 189,161 8,835 197,996 Sales and services: Sales of rental equipment — 23,767 23,767 Sales of new equipment — 10,308 10,308 Parts and services — 31,964 31,964 Total sales and services — 66,039 66,039 Total revenue $ 189,161 $ 74,874 $ 264,035 Year Ended December 31, 2018 (in $000s) Topic 840 Topic 606 Total Rental: Rental revenue $ 177,032 $ — $ 177,032 Shipping and handling — 7,531 7,531 Total rental revenue 177,032 7,531 184,563 Sales and services: Sales of rental equipment — 26,019 26,019 Sales of new equipment — 18,349 18,349 Parts and services — 17,366 17,366 Total sales and services — 61,734 61,734 Total revenue $ 177,032 $ 69,265 $ 246,297 Rental Revenue. Our rental contracts are for various equipment, parts, tools, and accessories under 28 day or monthly agreements which include automatic renewal provisions. The majority of our rental payments are due upon receipt, with a majority that are billed at the end of each 28-day or monthly period. Revenue is recognized ratably over the rental agreement period and in accordance with Accounting Standards Codification 840, Leases (“Topic 840”). Unearned revenue is reported in our Deferred rent income line of our Consolidated Balance Sheets. We had deferred revenue of $1.0 million as of December 31, 2020 and $2.3 million as of December 31, 2019 Equipment Sales. We sell both new and used equipment. The contractual sales price for each individual product represents the standalone selling price. Our used equipment is of a sufficiently unique nature - based on the specifics of its age, usage, etc. - in that it does not have an observable standalone selling price. Equipment sales revenue is recognized when equipment is delivered, which is when the transfer of title, risks and rewards of ownership, and control are considered passed to the customer. Payment is usually due within 30 days subsequent to transfer of control of the asset. There are no rights of return or warranties offered on equipment sales. Parts Sales and Services. We sell parts, tools and accessories. We derive our services revenue primarily from maintenance, repair and upfit services on heavy-duty trucks and cranes. Revenue from these services includes parts sales needed to complete the service work. We recognize services revenue when the service work is completed. We record revenue on a point in time basis as parts are delivered. The amount of consideration we receive for parts is based upon a list price net of discounts and incentives, and the impact of such variable consideration is factored into the amount of revenue we recognize at any point in time. The amount of consideration received for service is based upon labor hours expended and parts utilized to perform and complete the necessary services for our customers. There are no rights of return or warranties offered on parts sales. Payment is usually due and collected within 30 days subsequent to delivery of parts or performance of service. We record sales tax billed to customers and remitted to governmental authorities on a net basis and, consequently, these amounts are excluded from revenues and expenses. Sales taxes are recorded as accrued expenses when billed. Shipping and Handling Costs We classify shipping and handling fees billed to customers related to the placement of rental units as rental revenues on our Consolidated Statements of Operations. We include the related shipping and handling costs in cost of rental and sales revenues, excluding depreciation, on our Consolidated Statements of Operations. Shipping and handling fees billed to customers related to the sales of equipment and parts are recorded as equipment sales or parts sales and services revenue, respectively. The related shipping and handling costs are recorded in cost of equipment sales or cost of parts sales and services, respectively. Advertising Costs We promote our business through various industries media channels, and expense advertising costs as incurred. Licensing and Titling Expenses The costs of licensing related to our vehicles, including rental equipment, is recorded in Prepaid expenses and other assets on our Consolidated Balance Sheets. The licensing cost is recognized as licensing and titling expense over the license period. Costs for titling our vehicles, including rental equipment, is expensed as incurred. Share-Based Compensation The fair value of equity-classified awards is determined at the grant date using techniques appropriate for the awards, which we use to determine compensation expense over the service period. The fair value of liability-classified awards is determined at the grant date and is remeasured at the end of each reporting period through the date of settlement and adjusted through compensation expense. We recognize compensation expense for our share-based payments over the requisite service period for the entire award. See Note 13, Share-Based Compensation, for additional information. Income Taxes We utilize the asset and liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between financial accounting and tax bases of assets and liabilities and are measured using the tax rates and laws that are expected to be in effect when the differences are expected to reverse. Recognition of deferred tax assets is limited to amounts considered by management to be more-likely-than-not to be realized in future periods. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. The effect on net deferred tax assets and liabilities resulting from a change in tax rates is recognized as income or expense in the period that the change in tax rates is enacted. We make certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments are applied in the calculation of the deferred income tax expense or benefit associated with certain deferred tax assets and liabilities. Significant changes to these estimates may result in an increase or decrease to our tax provision in a subsequent period. Our income tax returns are subject to examination by federal, state and foreign tax authorities. There may be differing interpretations of tax laws and regulations, and as a result, disputes may arise with these tax authorities involving the timing and amount of deductions and allocation of income. With the exception of net operating loss carryforwards (“NOLs”), we are no longer subject to federal, state, local, and foreign income tax examinations by tax authorities for years ending on or prior to December 31, 2016. We recognize uncertain income tax positions if it is more-likely-than-not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more-likely-than-not means a likelihood of more than 50%. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. Our determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances, and information available at the reporting date and is subject to management’s judgment. Unrecognized tax benefits are tax benefits claimed in our tax returns that do not meet recognition and measurement standards. Our policy is to record interest and penalties related to unrecognized tax benefits in income tax expense (benefit) on our Consolidated Statements of Operations. As of December 31, 2020 and 2019, our uncertain income tax positions, unrecognized tax benefits, and accrued interest were not material. Acquisition Accounting We have made acquisitions in the past and may continue to make acquisitions in the future. The assets acquired and liabilities assumed are recorded based on their respective fair values at the date of acquisition. Long-lived assets (principally rental equipment), goodwill and other intangible assets generally represent the largest components of our acquisitions. Rental equipment is valued utilizing either a cost, market or income approach, or a combination of certain of these methods, depending on the asset being valued and the availability of market or income data. The intangible assets that we have acquired are non-compete agreements, customer relationships and trade names and associated trademarks. The estimated fair values of these intangible assets reflect various assumptions about discount rates, revenue growth rates, operating margins, terminal values, useful lives and other prospective financial information. Goodwill is calculated as the excess of the cost of the acquired entity over the net of the fair value of the assets acquired and the liabilities assumed. Non-compete agreements, customer relationships and trade names and associated trademarks are valued based on an excess earnings or income approach based on projected cash flows. Determining the fair value of the assets and liabilities acquired is judgmental in nature and can involve the use of significant estimates and assumptions. The judgments made in determining the estimated fair value assigned to the assets acquired, as well as the estimated life of the assets, can materially impact net income (loss) in periods subsequent to the acquisition because of depreciation and amortization, and in certain instances through impairment charges if the asset becomes impaired in the future. As discussed above, we regularly review long-lived assets for impairments. When we make an acquisition, we also acquire other assets and assume liabilities. These other assets and liabilities typically include, but are not limited to, parts inventory, accounts receivable, accounts payable and other working capital items. Because of their short- term nature, the fair values of these other assets and liabilities generally approximate the carrying values on the acquired entities’ balance sheets. Recently Issued Accounting Pronouncements We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012. Accordingly, we have elected to comply with certain reduced public company reporting requirements related to effective dates for the adoption of newly issued standards issued by the Financial Accounting Standards Board (the “FASB”). An emerging growth company is permitted to apply the effective dates applicable to non-public entities, which generally are delayed in comparison to public entities that are non-emerging growth entities. As a result of the transactions described in Note 17, Subsequent Events , we anticipate that we will lose our emerging growth company status. A company continues to be an emerging growth company until one of the following occurs: (i) annual revenue exceeds $1.07 billion; (ii) non-convertible debt of more than $1.0 billion is issued in the past three years; or, (iii) the company becomes a large accelerated filer, as defined in Exchange Act Rule 12b-2. As a result of losing such status, we will no longer be able to take advantage of the later adoption dates for the pronouncement described below. Leases The FASB’s new guidance to account for leases (“Topic 842”) by entities that are lessees, requires (1) recognition of lease assets and lease liabilities on the balance sheet and (2) disclosure of key information about leasing arrangements. Topic 842 provides two classifications for leases: financing or operating. Finance leases. The accounting and recognition for leases qualifying as finance leases is similar to the accounting and recognition required under ASC Topic 840, " Leases (“Topic 840”)," for capital leases. As of December 31, 2020, we have capital lease obligations of approximately $10.5 million When we make our contractually required payments under the capital leases, we allocate a portion to reduce the capital lease obligation and a portion is recognized as interest expense. The assets leased under the capital leases are included in rental equipment, and depreciation thereon is recognized in cost of rental revenue. Operating leases. Under Topic 842, operating leases result in the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet. ROU assets represent our right to use the leased asset for the lease term and lease l |
Segments
Segments | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Segments | Note 3: Segments We operate and have two reportable business segments, Equipment Rental and Sales (“ERS”) and Parts, Tools and Accessories (“PTA”). ERS provides rental solutions to utilities and contractors serving multiple infrastructure end-markets, including electric T&D, telecom, rail, lighting and signage. We rent and sell specialized equipment to utilities and utility contractors that build and maintain critical T&D infrastructure. Utilizing our national platform and rental fleet, we expanded our focus on equipment rental to the telecom, rail, lighting and signage end-markets. The majority of our existing equipment can be used across multiple end-markets and many of our customers operate in multiple end-markets. We rent and sell a broad range of new and used equipment including bucket trucks, digger derricks, line equipment, cranes, pressure diggers, rail mounted equipment and underground equipment. Our PTA segment offers customers sale and rental solutions for parts, tools and accessories to complement our specialty equipment line. Our PTA segment also includes maintenance, repair and upfit services of new and used heavy-duty trucks and cranes. Our reportable segments align with the information our chief operating decision maker (“CODM”) receives on a regular basis to evaluate the performance of the business and to allocate resources. The accounting principles applied at the operating segment level in determining gross profit are generally the same as those applied at the consolidated financial statement level. There are no inter-segment revenues, and cost allocations to operating segment cost of revenue are minimal; that is, revenue, cost of equipment and parts sold or rented, depreciation of rental equipment and gross profit are directly attributed to each of the operating segments. The following tables present our financial information by segment: Year Ended December 31, 2020 (in $000s) ERS PTA Total Rental revenue $ 179,933 $ 15,557 $ 195,490 Sales of rental equipment 31,533 — 31,533 Sales of new equipment 25,099 — 25,099 Parts sales and services — 50,617 50,617 Total revenue 236,565 66,174 302,739 Cost of revenue 103,547 44,217 147,764 Depreciation of rental equipment 74,376 4,156 78,532 Gross profit $ 58,642 $ 17,801 $ 76,443 Year Ended December 31, 2019 (in $000s) ERS PTA Total Rental revenue $ 182,720 $ 15,276 $ 197,996 Sales of rental equipment 23,767 — 23,767 Sales of new equipment 10,308 — 10,308 Parts sales and services — 31,964 31,964 Total revenue 216,795 47,240 264,035 Cost of revenue 76,573 30,346 106,919 Depreciation of rental equipment 66,228 4,340 70,568 Gross profit $ 73,994 $ 12,554 $ 86,548 Year Ended December 31, 2018 (in $000s) ERS PTA Total Rental revenue $ 173,267 $ 11,296 $ 184,563 Sales of rental equipment 26,019 — 26,019 Sales of new equipment 18,349 — 18,349 Parts sales and services — 17,366 17,366 Total revenue 217,635 28,662 246,297 Cost of revenue 84,509 16,077 100,586 Depreciation of rental equipment 60,436 3,657 64,093 Gross profit $ 72,690 $ 8,928 $ 81,618 Total assets by segment are not disclosed herein because asset by operating segment data is not reviewed by the CODM as the basis to assess performance and allocate resources. Goodwill related to our ERS segment and PTA segment was $229.1 million and $9.0 million, respectively, as of December 31, 2020 and $229.4 million and $8.8 million as of December 31, 2019. Gross profit is the primary operating result whereby our segments are evaluated for performance and resource allocation. The following table presents a reconciliation of segment gross profit to consolidated loss before income taxes: Year Ended December 31, (in $000s) 2020 2019 2018 Gross profit $ 76,443 $ 86,548 $ 81,618 Selling, general and administrative expenses 43,464 34,667 32,718 Licensing and titling expenses 2,945 2,617 2,241 Amortization and non-rental depreciation 3,248 3,122 3,045 Transaction expenses 6,627 7,641 440 Asset impairment — 657 — Other operating expenses 2,911 1,826 10 Other (income) expense 5,399 1,690 287 Loss on extinguishment of debt — 4,005 — Interest expense, net 63,200 63,361 56,698 Loss before income taxes $ (51,351) $ (33,038) $ (13,821) We are positioned to serve all 50 U.S. states and 13 Canadian provinces and territories using our network of locations in North America. The following tables present revenue by country and total assets by country: Year Ended December 31, (in $000s) 2020 2019 2018 Revenue: United States $ 295,125 $ 257,297 $ 237,815 Canada 5,827 5,705 6,297 Mexico 1,787 1,033 2,185 $ 302,739 $ 264,035 $ 246,297 (1) On September 27, 2019, the Company began commencing activities for the closure of its Mexican operations, which is part of the ERS segment. For the years ended December 31, 2020, 2019 and 2018, Mexico generated a loss before income taxes of $2.1 million, $4.3 million and $1.9 million, respectively. The year ended December 31, 2019 included an impairment loss of $0.7 million and a charge for statutorily required termination benefits of $0.2 million. December 31, (in $000s) 2020 2019 Assets: United States $ 762,696 $ 802,516 Canada 5,447 8,152 Mexico 261 4,616 $ 768,404 $ 815,284 |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combination | Note 4: Business Combinations 2019 Acquisition . On September 20, 2019, we entered into a stock purchase agreement with Truck Utilities, Inc. (“Truck Utilities”). Truck Utilities is a specialty rentals, parts, tools and accessories sales, service, equipment sales and truck upfitting company serving the electric transmission, distribution, telecom, and other regional end-markets. On November 4, 2019, we closed on the acquisition for a purchase price of approximately $44.7 million (net of cash acquired of $3.1 million), prior to certain capital expenditure adjustments of approximately $3.8 million. Truck Utilities’ rentals, equipment sales and truck upfitting operations were added to our ERS segment, while its parts, tools and accessories sales and service were added to our PTA segment. The transaction was financed by drawing on the 2019 Credit Facility. Truck Utilities reported revenue of $8.5 million and pretax income of $0.2 million during the period from November 5, 2019 to December 31, 2019. 2018 Acquisition. On July 2, 2018, Nesco acquired 100% of the common stock of N&L Line Equipment (“N&L”) for $5.0 million. N&L manufactures hot line tools and is a distributor for lineman’s equipment and supplies in the utility industry. In addition to distributing for a wide variety of manufacturers, N&L also has the capability to test, repair, and certify most of the equipment that is sold N&L’s products will be sold through our existing distribution channels and N&L was added to our PTA segment. The acquisition was settled with $1.6 million cash consideration and the issuance of $3.5 million, 5% interest, five-year unsecured promissory notes to two former owners on July 2, 2018. N&L reported revenues of $2.1 million and $0.4 million pretax income during the July 2, 2018 to December 31, 2019 period. We accounted for the acquisitions using the acquisition method of accounting. The purchase price has been allocated to the fair value of the tangible and identifiable intangible assets acquired as determined by management with the assistance of independent third parties. The results of operations of the acquisitions have been included with the Company’s results since the dates of each acquisition. Transaction costs associated with the acquisitions were expensed as incurred. The fair value of the assets acquired and liabilities assumed as of the acquisition dates were as follows: 2019 2018 (in $000s) Truck Utilities (November 4, 2019) N&L Cash $ 3,094 $ 69 Accounts receivable 3,029 559 Inventory 4,178 270 Other current assets 155 — Property and equipment 78 474 Rental equipment 38,780 1,056 Customer relationships 2,110 1,610 Trademarks 750 530 Non-competition agreements 140 90 Total identifiable assets acquired 52,314 4,658 Accounts payable and other liabilities (10,132) (378) Note payable — (504) Total liabilities assumed (10,132) (882) Goodwill 9,338 1,189 Total consideration $ 51,520 $ 4,965 The values of intangible assets and goodwill related to the acquisition of Truck Utilities consists largely of the synergies and economies of scale provided by the acquired rental equipment portion of the business, as well as additional service center locations in the central Midwestern region of the United States. Goodwill was allocated to the ERS and PTA reporting unit in the amount of $5.6 million and $3.7 million, respectively. None of the goodwill recognized is expected to be deductible for income tax purposes. Intangible assets of $2.2 million and goodwill of $1.2 million arising from the N&L acquisition consists largely of the synergies and economies of scale expected from expanding to meet high demand for hot line tools and lineman’s supplies in the utility industry. None of the goodwill recognized is expected to be deductible for income tax purposes. Unaudited pro forma information. The operating results of these acquisitions have been reflected in the Company’s consolidated financial statements since the dates of each acquisition. The following unaudited pro forma information is presented for comparison purposes as if the Truck Utilities acquisition was completed as of January 1, 2018 (pro forma information related to N&L is not material to the Company’s consolidated results): (in $000s) 2019 2018 Total revenue $ 301,450 $ 291,141 Net loss (24,576) (14,875) Basic and diluted net loss per share (0.74) (0.69) |
Rental Equipment and Property E
Rental Equipment and Property Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Rental Equipment and Property Equipment | Note 5: Rental Equipment and Property Equipment As of December 31, rental equipment, net and property and equipment, net, consisted of the following: (in $000s) 2020 2019 Rental equipment $ 654,547 $ 658,564 Less: accumulated depreciation (318,735) (275,144) Rental equipment, net $ 335,812 $ 383,420 (in $000s) 2020 2019 Property and equipment $ 11,816 $ 10,082 Less: accumulated depreciation (8,137) (7,168) Construction in progress 2,590 3,647 Property and equipment, net $ 6,269 $ 6,561 On September 27, 2019, we commenced closure of the Company’s rental equipment operations in Mexico due to continued delays in contracts from the Mexican government. An impairment loss of $0.7 million was recorded to reduce the carrying amount of rental equipment to its fair value, which was determined based on a recent analysis of market activity (i.e., Level 3 fair value as defined in Note 2, Summary of Significant Accounting Policies , |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 6: Goodwill and Other Intangible Assets Annual goodwill impairment testing and Nesco trade name impairment testing are performed in the fourth quarter of each year; unless events or circumstances indicate earlier impairment testing is required. No goodwill or intangibles impairment loss was recognized in the years ended December 31, 2020, 2019 and 2018. As of December 31, 2020, 2019 and 2018, cumulative goodwill, trade names and customer relationships impairment losses were $190.7 million, $9.9 million and $114.4 million, respectively. As of December 31, the balances of goodwill and intangible assets were as follows: (in $000s) Amortization Gross Accumulated Net Intangible 2020 Goodwill $ 238,052 $ — $ 238,052 Other intangible assets, net: Nesco trade name Indefinite 28,000 — 28,000 Trade names 15 years 1,780 (284) 1,496 Non-compete agreements 1-3 years 520 (475) 45 Customer relationships 15-20 years 52,170 (14,132) 38,038 Total other intangible assets 82,470 (14,891) 67,579 Goodwill and other intangible assets, net $ 320,522 $ (14,891) $ 305,631 (in $000s) Amortization Gross Accumulated Net Intangible 2019 Goodwill $ 238,195 $ — $ 238,195 Other intangible assets, net: Nesco trade name Indefinite 28,000 — 28,000 Trade names 15 years 1,030 (128) 902 Non-compete agreements 3 years 380 (245) 135 Customer relationships 15-20 years 52,880 (11,365) 41,515 Total other intangible assets, net 82,290 (11,738) 70,552 Goodwill and other intangible assets, net $ 320,485 $ (11,738) $ 308,747 During the year ended December 31, 2020, goodwill decreased by $0.1 million. During the year ended December 31, 2019, goodwill increased by $9.5 million. The changes in goodwill were the result of the acquisition of Truck Utilities in 2019 and completion of the allocation of the purchase price to the fair value of the net assets acquired (see Note 4, Business Combinations ). Our amortization expense on intangibles was $3.2 million, $3.0 million, and $2.8 million for 2020, 2019, and 2018 respectively. As of December 31, 2020, our estimated amortization expense for other intangible assets for each of the next five years and thereafter is estimated to be as follows: (in $000s) 2021 $ 3,015 2022 3,015 2023 3,008 2024 2,997 2025 2,997 Thereafter 24,547 Total $ 39,579 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 7: Fair Value Measurements The following table sets forth the carrying values (exclusive of deferred financing fees) and fair values of our financial liabilities as of December 31: Fair Value (in $000s) Carrying Value Level 1 Level 2 Level 3 2020 2019 Credit Facility $ 250,971 $ — $ 250,971 $ — Senior Secured Notes due 2024 475,000 — 519,379 — Notes Payable 2,379 — 2,379 — Derivative 7,012 — 7,012 — 2019 2019 Credit Facility $ 250,000 $ — $ 250,000 $ — Senior Secured Notes due 2024 475,000 — 494,000 — Notes Payable 3,525 — 3,650 — Derivative 1,709 — 1,709 — |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments | Note 8: Financial Instruments In the normal course of business, the Company uses various financial instruments, including derivative instruments, to manage the risks associated with interest rate exposure. These financial instruments are not used for trading or speculative purposes. Derivatives Instruments Designated as Hedges We entered into an interest rate collar on December 4, 2018, to hedge the interest rate risk associated with our previous revolving credit facility, which was repaid on the date of the Merger. The interest rate collar was designated as a cash flow hedge and had a term extending to September 30, 2020. In contemplation of the Transactions, on July 17, 2019, we terminated the interest rate collar, which resulted in the hedge becoming undesignated. Accordingly, $0.8 million (net of income taxes of $0.3 million) was reclassified from accumulated other comprehensive loss to Other income (expense) net, in our Consolidated Statements of Operations during the year ended December 31, 2019. Derivatives Not Designated as Hedges On July 17, 2019, we entered into an interest rate collar agreement to mitigate the risk of changes in the interest rate paid during the contract period for $170.0 million of the Company’s variable rate loans under the 2019 Credit Facility. Under the terms of the interest rate collar, we are required to pay the counterparty to the agreement an amount equal to the difference between a monthly LIBOR-based interest rate and a defined interest rate floor; conversely, we are entitled to receive from the counterparty an amount equal to the excess of a LIBOR-based interest rate and a defined interest rate cap. The required payments due to or due from the counterparty are calculated by applying the interest rate differential to the notional amount ($170.0 million) and are determined monthly through July 31, 2024. The interest rate collar expires in July 2024 and has not been designated as a cash flow hedge. Consequently, the change in fair value of the interest rate collar is recognized in Other expense, net in our Consolidated Statements of Operations ($5.3 million in 2020 and $1.7 million in 2019). The counterparty to the Company’s interest rate collar is an investment grade major international financial institution. The Company could be exposed to losses in the event of nonperformance by the counterparty; however, the credit rating and the concentration of risk in this financial institution are monitored on a continuous basis and present no significant credit risk to the Company. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9: Commitments and Contingencies We record a liability when we believe that it is both probable that a liability has been incurred and the amount can be reasonably estimated. Significant judgment is required to determine both probability and the estimated amount. We review these provisions at least quarterly and adjust these provisions to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and updated information. Legal Matters We are subject to various claims and legal actions that arise primarily in the ordinary course of business. These matters include, but are not limited to, general liability claims (including personal injury, product liability, property, and auto claims), indemnification and guarantee obligations, employee injuries and employment-related claims, and contract and real estate matters. We maintain insurance coverage for our operations and employees. Our major policies include coverage for property, general liability, auto, directors and officers, health, and workers’ compensation insurances. The ultimate legal and financial liability with respect to such matters generally cannot be estimated with certainty and requires the use of estimates in recording liabilities for potential litigation settlements against us. Estimates for losses from litigation are made after consultation with outside legal counsel. In our opinion, after consultation with legal counsel, the disposition or ultimate resolution of such claims and actions will not have a material adverse effect on our consolidated financial position, results of operations, or cash flows. Purchase Commitments We enter into purchase agreements with manufacturers and suppliers of equipment for our rental fleet and inventory. The majority of these agreements are cancellable within a specified notification period to the supplier. As of December 31, 2020, we had no purchase commitments. Operating Leases We lease certain facilities under various operating leases. Our lease agreements include customary renewal options and base rental escalation clauses, for which the related rent expense is accounted for on a straight-line basis during the terms of the respective leases. Additionally, certain leases may require us to pay maintenance, insurance, taxes, and other expenses in addition to the stated rental payments. Rent expense included in cost of rental revenue was $1.3 million for 2020, $1.9 million for 2019 and $1.5 million in 2018. Rent expense included in cost of parts sales and services was $0.8 million in 2020 (none in 2019 and 2018). Rent expense included in selling, general, and administrative expenses was $0.6 million in 2020, $0.4 million in 2019 and $0.3 million in 2018. We lease certain fleet equipment under a master lease agreement. Our lease agreement is for a five-year period at the end of which we can return or purchase the equipment, or extend the life of the lease. Related rent expense is accounted for on a straight-line basis during the term of the lease. The equipment lease requires us to pay maintenance, insurance, taxes, and other expenses in addition to the stated rental payments. Rent expense included in cost of rental revenue for 2020, 2019 and 2018 was $1.8 million, $2.2 million, and $5.0 million, respectively. As of December 31, 2020, minimum lease payments for each of the next five years and thereafter were as follows: (in $000s) 2021 $ 2,727 2022 2,097 2023 1,721 2024 1,135 2025 475 Thereafter 1,607 Total $ 9,762 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Note 10: Debt Debt obligations and associated interest rates consisted of the following as of December 31: (in $000s) 2020 2019 2020 2019 2019 Credit Facility $ 250,971 $ 250,000 3.4% 4.2% Senior Secured Notes due 2024 475,000 475,000 10.0% 10.0% Notes Payable 2,379 3,525 Total debt outstanding 728,350 728,525 Deferred finance fees (11,212) (14,222) Net debt 717,138 714,303 Less current maturities (1,280) (1,280) Long-term debt $ 715,858 $ 713,023 On July 31, 2019, the amounts outstanding under certain debt agreements comprised of revolving credit borrowings and fixed rate notes payable were extinguished. In connection with the extinguishment, unamortized deferred financing fees were written-off. The loss on extinguishment of debt aggregated $4.0 million. 2019 Credit Facility On July 31, 2019, the Company entered into a secured asset based loan agreement (“2019 Credit Facility”), consisting of a $350.0 million first lien senior secured asset based revolving credit facility with a maturity of five years, which includes borrowing capacity available for letters of credit, borrowings on a same-day notice basis and a swingline sub-facility. On March 10, 2020, we entered into an agreement (the “Incremental Agreement”) amending the 2019 Credit Facility. The Incremental Agreement amends the syndicate of banks for a new participant that increased the maximum amount of the facility by $35.0 million to a total of $385.0 million . The Company incurred $4.8 million in connection with the closing of the 2019 Credit Facility. This amount has been recorded as a reduction to the carrying value in the Consolidated Balance Sheets and will be amortized over the term of the 2019 Credit Facility. Borrowings under the 2019 Credit Facility are limited to certain borrowing base calculations that vary with eligible accounts receivable, inventory, and eligible rental equipment. As of December 31, 2020, there was $90.2 million (excluding cash) of availability under the 2019 Credit Facility. At December 31, 2020, the Company had $1.4 million of letters of credit outstanding and no amounts outstanding under the swingline sub-facility. The interest rate per annum applicable to loans under the 2019 Credit Facility is, at the Company’s option, equal to either an alternate base rate or an adjusted LIBOR rate (which, at the Company’s option is available for a one-, two-, three-, or six- month interest period, or a twelve-month or period of less than one month if available from all relevant affected lenders) in each case, plus an applicable margin (such applicable margin to vary with the amount outstanding under the 2019 Credit Facility). The alternate base rate will be the greater of (i) the prime commercial lending rate published by The Wall Street Journal, (ii) the Federal Funds Effective Rate, plus 0.50%, (iii) the adjusted LIBOR rate for an interest period of one month plus 1.00% and (iv) 1.00%. The adjusted LIBOR rate will be the London interbank offered rate for euro dollar deposits for a period equal to the applicable interest period on the Reuters Screen LIBOR01 or LIBOR02 Page, as applicable, adjusted for statutory reserve requirements for euro currency liabilities and in no event, shall the adjusted LIBOR Rate be less than 0.00%. The ability to draw under the 2019 Credit Facility or issue letters of credit thereunder will be conditioned upon, among other things, delivery of prior written notice of a borrowing or issuance, as applicable, the ability to reaffirm the representations and warranties contained in in the 2019 Credit Facility agreement and the absence of any default or event of default under the 2019 Credit Facility. The Company is required to pay a commitment fee to the lenders under the 2019 Credit Facility with respect to the unutilized commitments thereunder at a rate equal to 0.375% per annum (subject to reductions based upon the amount outstanding under the 2019 Credit Facility). The Company will also pay customary letter of credit and agency fees. The balance outstanding on the 2019 Credit Facility will be payable on the earlier of July 31, 2024 or, if the Senior Secured Notes due 2025 remain outstanding and are outstanding on May 1, 2024. The Company will be required to repay outstanding loans under the 2019 Credit Facility if the outstanding loans under the 2019 Credit Facility exceed the lesser of (x) the borrowing base and (y) the commitments under the 2019 Credit Facility (the “Line Cap”). Additionally, the Company may voluntarily repay outstanding loans under the 2019 Credit Facility at any time without premium or penalty other than customary “breakage” costs with respect to Euro currency loans. All obligations under the 2019 Credit Facility are unconditionally guaranteed by each of the Company’s existing and future direct and indirect wholly owned domestic restricted subsidiaries (the “2019 Credit Facility Guarantors”), in each case subject to certain exceptions and permitted liens. All obligations under the 2019 Credit Facility and the guarantees of those obligations (as well as any interest-hedging or other swap agreements and cash management arrangements with the lenders and/or their affiliates under the 2019 Credit Facility) are secured by (subject to certain exceptions): (i) a first priority pledge by the Company of all of the equity interests of restricted subsidiaries directly owned by the Company and the 2019 Credit Facility Guarantors (limited to 65% of voting capital stock in the case of foreign subsidiaries owned directly by a U.S. subsidiary and subject to certain other exceptions) and subject to certain exceptions in the case of non-wholly owned subsidiaries and (ii) a first priority security interest in substantially all of the Company’s present and after-acquired assets, as well as those of each of the 2019 Credit Facility Guarantors, all of the Company’s proceeds and the proceeds of the 2019 Credit Facility Guarantors and all intercompany indebtedness owed to the Company and the 2019 Credit Facility Guarantors. The 2019 Credit Facility is subject to covenants that, among other things, limit the Company’s ability and its restricted subsidiaries’ ability to: incur additional indebtedness; pay dividends, redeem stock or make other distributions; repurchase, prepay or redeem subordinated indebtedness; make investments; create restrictions on the ability of the Company’s restricted subsidiaries to pay dividends to the Company; create liens; transfer or sell assets; consolidate, merge, sell or otherwise dispose of all or substantially all of the Company’s assets; enter into certain transactions with the Company’s affiliates; and designate subsidiaries as unrestricted subsidiaries. In addition, the 2019 Credit Facility requires the Company to comply with a financial maintenance covenant requiring the Company and its restricted subsidiaries to maintain a fixed charge coverage ratio of at least 1.00 to 1.00; provided that this covenant shall only be tested if availability under the 2019 Credit Facility is less than the greater of (i) 10% of the Line Cap and (ii) $30 million and shall be tested until availability is no longer less than such amounts for 20 consecutive calendar days. Senior Secured Notes due 2024 In connection with the closing of the Transactions, on July 31, 2019 we completed a private offering for Senior Secured Second Lien Notes due 2024 (the “Senior Secured Notes”) issued by Capitol Investment Merger Sub 2, LLC, our wholly owned and indirect subsidiary (the “Issuer”). The aggregate principal amount of the Senior Secured Notes was $475.0 million. The Senior Secured Notes bear interest at a rate of 10.0% per annum payable semi-annually, in cash in arrears, on February 1 and August 1 of each year, which commenced on February 1, 2020. The Senior Secured Notes do not have registration rights. A summary of the key provisions are as follows: Guarantors The Senior Secured Notes are guaranteed (the “Guarantees”) by Capitol Intermediate Holdings, LLC, our wholly owned subsidiary (“Holdings”) and the wholly owned domestic subsidiaries of the Issuer (together, “Guarantors”) that guarantee obligations under the 2019 Credit Facility or any future debt of Nesco or any other Guarantors. Security The Senior Secured Notes and the Guarantees are secured on a second-priority basis by all assets of Nesco and the Guarantors that secure our obligations under the 2019 Credit Facility. Ranking The Senior Secured Notes and the Guarantees are general senior secured obligations. The Senior Secured Notes rank equally in right of payment with all of our existing and future senior debt and rank senior in right of payment to all of our future subordinated obligations. The Guarantees rank equally in right of payment with all of the Guarantors’ existing and future senior obligations and rank senior in right of payment to all of the Guarantors’ existing and future subordinated obligations. The Senior Secured Notes and the Guarantees rank effectively subordinated to all of the Guarantors’ and our first-priority secured debt, including borrowings under the 2019 Credit Facility. Redemption and Repurchase The Senior Secured Notes are redeemable, in whole or in part, at any time at specified redemption prices. At any time prior to August 1, 2021, we may redeem all or part of the notes at a redemption price equal to 100.0% of the principal amount, plus an applicable premium, plus accrued and unpaid interest, if any, to the redemption date. The applicable premium entitles holders of the Senior Secured Notes to receive a make-whole payment calculated as the greater of 1% of the principal amount and the excess of the present value of the redemption price. We may also redeem some or all of the notes: from August 1, 2021, but before July 31, 2022, at a redemption price of 105.0% of the principal amount plus accrued and unpaid interest, if any, to the redemption date; from August 1, 2022, but before July 31, 2023, at a redemption price of 102.5% of the principal amount plus accrued and unpaid interest, if any, to the redemption date; and after August 1, 2023, at a redemption price of 100.0% of the principal amount plus accrued and unpaid interest, if any, to the redemption date. In addition, we may redeem up to 40.0% of the Senior Secured Notes until August 1, 2021, at a redemption price of 110.0% of the principal amount plus accrued and unpaid interest, if any, to the redemption date, with the net cash proceeds from one or more equity offerings. In addition, we may be required to make an offer to purchase the Senior Secured Notes upon the sale of certain assets and upon a change of control. Covenants The Senior Secured Notes contain various restrictive covenants. Notes Payable Notes payable relates to debt obligations incurred by the Company in connection with businesses acquired in 2017 and 2018 (see Note 4, Business Combinations ). These notes require the Company to make quarterly ($0.2 million) and annual ($0.5 million) principal payments, plus interest accrued at a 5% annual rate. These notes have maturities through July 2023. Capital Leases We enter into master lease agreements to lease certain fleet equipment. Our lease agreements are typically for a five year period at the end of which we can return or purchase the equipment, or extend the life of the lease, depending on the agreement. The carrying value of rental equipment under capital lease as of December 31, 2020 and 2019 was $13.3 million and $27.3 million, respectively. The equipment leases require us to pay maintenance, insurance, taxes, and other expenses in addition to the stated rental payments. Accumulated depreciation for fleet under capital lease as of December 31, 2020 was $8.7 million, and $15.2 million as of December 31, 2019. As of December 31, 2020, future payments under capital lease obligations are as follows: (in $000s) Capital Leases 2021 $ 5,885 2022 4,175 2023 1,617 Total 11,677 Less amounts representing interest (1,151) Capital lease obligations, including current portion $ 10,526 Loan Covenants and Compliance As of December 31, 2020, we believe we were in compliance with all of the covenants and other provisions of the 2019 Credit Facility and the indenture governing the Senior Secured Notes disclosed above. Any failure to be in compliance with any material provision or covenant of these agreements could have a material adverse effect on our liquidity and operations. The financial maintenance covenants include a borrowing base availability, fixed charge coverage ratio, funded indebtedness limit, and capital expenditure limitations. Debt Maturities As of December 31, 2020, the principal payments of debt outstanding over the next five years and thereafter were as follows: (in $000s) Notes Payable Long-Term Debt 2021 $ 1,280 $ — 2022 550 — 2023 549 — 2024 — 725,971 Total 2,379 725,971 Less unamortized discount and issuance costs — (11,212) $ 2,379 $ 714,759 |
Equity
Equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Equity | Note 11: Equity Preferred Stock As of December 31, 2020 and 2019, we were authorized to issue 5,000,000 shares of preferred stock with a par value of $0.0001 per share with such designation, rights and preferences as may be determined from time to time by our board of directors. As of December 31, 2020 and December 31, 2019, there were no shares of preferred stock issued or outstanding. On February 18, 2021, our shareholders approved an increase to the number of authorized shares (see Note 17, Subsequent Events ). Common Stock As of December 31, 2020 and 2019, we were authorized to issue 250,000,000 shares of Common Stock with a par value of $0.0001 per share. On February 18, 2021, our shareholders approved an increase to the number of authorized shares (see Note 17, Subsequent Events ). The sponsors of Capitol agreed to sale restrictions on 3,148,202 of the shares of common stock issued to them in exchange for their Class B ordinary shares of Capitol upon consummation of the Transactions. The parties agreed to a restriction on transfers of their respective shares of Nesco for a period of time, subject to certain permitted transfers. Concurrently with the Merger, and in a private placement, Nesco Owner and its affiliates purchased 4,500,000 newly-issued shares of common stock at a price of $10.00 per share in exchange for a combination of cash and full repayment of loans from Nesco Owner and Capitol Sponsors purchased in aggregate 1,000,000 newly-issued shares of common stock at a price of $10.00 per share, paid in cash. Warrants There are outstanding warrants to purchase 20,949,980 shares of our common stock. As part of the Transactions, Nesco Owner and certain members of Nesco’s management received warrants to purchase 2,500,000 shares of our common stock (such warrants, together with warrants held by the Capitol Sponsor, the “Non-Public Warrants”). On the date of the Transactions, each warrant had a fair value of $1.04. Each warrant entitles the holder to purchase one common share at a price of $11.50 per share, subject to certain adjustments. The warrants are currently exercisable and terminate on the earlier to occur of (i) July 31, 2024, and (ii) the redemption date. Except for the Non-Public Warrants, the Company may redeem the warrants at a price of $0.01 per warrant upon 30 days’ notice, only in the event that the last sale price of the common shares is at least $18.00 per share for any 20 trading days within a 30-trading day period ending on the third day prior to the date on which notice of redemption is given. If the Company redeems the warrants as described above, the holder may elect to exercise a warrant on a “cashless basis.” The redemption rights do not apply to the Non-Public Warrants if at the time of the redemption such Non-Public Warrants continue to be held by the holders as of July 31, 2019, or their affiliates or permitted transferees; however, once such Non-Public Warrants are transferred (other than to an affiliate or permitted transferee), the Company may redeem the Non-Public Warrants. The Company accounts for the warrants as freestanding equity-classified instruments because the Company has the ability to settle with holders of the warrants either by net-share or physical settlement. Contingently Issuable Shares |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 12: Earnings per Share Diluted net income (loss) per share includes the effects of potentially dilutive shares of common stock. Potentially dilutive effects include the exercise of warrants, contingently issuable shares, and share-based compensation, all of which have been excluded from the calculation of diluted net income (loss) per share because earnings are at a net loss and therefore, the potentially dilutive effect would be anti-dilutive. The number of potentially dilutive shares that have been excluded from the calculation of diluted net income (loss) per share aggregated approximately 27.7 million and 26.6 million for the years ended December 31, 2020 and 2019, respectively. The following table sets forth the computation of basic and diluted loss per share: Year Ended December 31, (in $000s) 2020 2019 2018 Net loss $ (21,277) $ (27,052) $ (15,526) Weighted-average basic and diluted shares outstanding: Shares issued in reverse recapitalization — 21,660,638 21,660,638 Shares outstanding post-recapitalization 49,064,615 49,033,903 — Weighted-average basic and diluted shares outstanding 49,064,615 33,066,165 21,660,638 Basic and diluted net loss per share $ (0.43) $ (0.82) $ (0.72) |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation | Note 13: Share-Based Compensation During the second quarter ended June 30, 2019, the Company's stockholders approved the 2019 Omnibus Incentive Plan, which authorizes up to 3,150,000 shares of common stock of Nesco Holdings, Inc. for issuance in accordance with the plan’s terms, subject to certain adjustments. On June 11, 2020, the Company's stockholders approved the Amended and Restated 2019 Omnibus Incentive Plan, which increased the total authorized shares of common stock of Nesco Holdings, Inc. to 6,150,000 (the "Plan"). The purpose of the Plan is to provide the Company's and its subsidiaries’ officers, directors, employees and consultants who, by their position, ability and diligence, are able to make important contributions to the Company’s growth and profitability, with an incentive to assist the Company in achieving its long-term corporate objectives, to attract and retain executive officers and other employees of outstanding competence and to provide such persons with an opportunity to acquire an equity interest in the Company. To accomplish these objectives, the Plan provides for awards of equity-based incentives through granting of restricted stock units, stock options, stock appreciation rights and other stock or cash based awards. At December 31, 2020, there were 2,452,992 shares in the share reserve still available for issuance. Prior to the completion of the Transactions, Holdings I had awards issued to certain employees comprised of phantom shares and profits interests in Nesco Owner. Share-based compensation expense related to these awards was $0.2 million and $1.1 million for the years ended December 31, 2019 and 2018, respectively. Substantially all of these awards were canceled on July 31, 2019. The Company records share-based compensation awards using a fair value method and recognizes compensation expense for an amount equal to the fair value of the share-based payment issued in its financial statements. The Company’s share-based compensation plans include programs for stock options, restricted stock units (“RSUs”), performance share units (“PSUs”), and deferred compensation. The fair value of each of the Company’s stock option and RSU awards is expensed on a straight-line basis over the required service period, which is generally the three-year vesting period. Restricted Stock Units The following table summarizes the Company’s RSU award activity: Number of Shares Weighted Average Grant Date Fair Value Outstanding RSUs, December 31, 2018 — $ — Granted 656,666 $ 6.98 Forfeited/cancelled/expired — $ — Vested — $ — Outstanding RSUs, December 31, 2019 656,666 $ 6.98 Granted 867,838 $ 2.76 Forfeited/cancelled/expired (219,412) $ 6.37 Vested (127,500) $ 6.98 Outstanding RSUs, December 31, 2020 1,177,592 $ 4.05 Compensation expense for RSUs recognized in selling, general and administrative expenses on the consolidated statements of operations was $1.2 million and $0.4 million for the years ended December 31, 2020 and 2019, respectively. At December 31, 2020, unrecognized compensation expense related to RSUs was $4.1 million and is expected to be recognized over a remaining period of 3.1 years. Stock Options The following table summarizes the Company’s stock option activity: Number of Options Weighted Average Exercise Price Outstanding stock options, December 31, 2018 — $ — Granted 1,513,334 $ 9.60 Exercised — $ — Forfeited/cancelled/expired — $ — Outstanding stock options, December 31, 2019 1,513,334 $ 9.60 Granted 1,297,076 $ 3.70 Exercised — $ — Forfeited/cancelled/expired (418,494) $ 9.45 Outstanding stock options, December 31, 2020 2,391,916 $ 6.43 Compensation expense for stock options recognized in selling, general and administrative expenses on the consolidated statements of operations was $1.2 million and $0.4 million for the years ended December 31, 2020 and 2019, respectively. At December 31, 2020, unrecognized compensation expense related to stock options was $3.8 million and is expected to be recognized over a remaining period of 2.9 years. As of December 31, 2020, the total intrinsic value of stock options outstanding and currently exercisable was less than $0.1 million. No stock options were exercised during the years ended December 31, 2020, 2019 or 2018. The following table presents the options outstanding and options exercisable by exercise price with the weighted-average remaining contractual life for the options outstanding and the weighted-average exercise price at December 31, 2020: Options Outstanding Options Exercisable Exercise Price Options Outstanding at December 31, 2020 Weighted Average Remaining Contractual Life (In Years) Weighted Average Grant Date Fair Value Options Exercisable at December 31, 2020 Weighted Average Grant Date Fair Value $3.02 - $6.98 1,458,583 9.3 $ 1.69 66,666 $ 3.21 $10.00 933,333 8.6 $ 3.13 233,333 $ 3.13 2,391,916 9.1 $ 2.25 299,999 $ 3.15 The average fair value of each option award at grant date was estimated using the Black-Scholes option-pricing model with the following assumptions: 2020 2019 Dividend yield 0.00 % 0.00 % Volatility 47.00 % 47.00 % Risk-free rate of return 1.58 % 1.58 % Expected life, in years 7.0 6.0 Expected volatility is based on the weighted-average combination of the Company’s historic volatility and of the implied volatility of a group of the Company’s peers. The risk-free rate of return is based on the yield curve of a zero-coupon U.S. Treasury bond on the date the award is granted with a maturity equal to the expected term of the award. The expected life of the Company’s stock option awards is derived from the simplified approach based on the weighted-average time to vest and the remaining contractual term and represents the period of time that awards are expected to be outstanding. |
Income Tax
Income Tax | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Note 14: Income Tax We are subject to taxation in all jurisdictions in which we operate within the United States, Canada, and Mexico. Substantially all of our income before income taxes for all periods presented is U.S. sourced. The foreign income tax amounts relate to withholding taxes for revenues earned on our rental equipment held in Canada attributable to our U.S. operations. The provision for income tax expense (benefit), including the amount of domestic and foreign loss before taxes, is as follows: Year Ended December 31, (in $000s) 2020 2019 2018 Components of loss before tax: Domestic $ (49,096) $ (30,046) $ (12,454) Foreign (2,255) (2,992) (1,367) Total loss before tax (51,351) (33,038) (13,821) Current tax expense: Federal (1,393) — — Foreign 61 483 514 State 66 392 95 Total current tax expense (1,266) 875 609 Deferred tax expense (benefit): Federal (9,179) 852 852 Foreign — — — State (1,786) 244 244 Total deferred tax expense (10,965) 1,096 1,096 Valuation allowance (17,843) (7,957) — Total tax expense (benefit) $ (30,074) $ (5,986) $ 1,705 A reconciliation between the federal statutory income tax rate and our actual effective income tax rate is as follows: Year Ended December 31, (in $000s) 2020 2019 2018 Expected federal income statutory tax rate 21.0% 21.0% 21.0% Tax effect of differences: Foreign operations (0.1)% (1.2)% (3.0)% Share-based payments (0.2)% (0.1)% (1.8)% Effect of state income taxes, net of federal income tax benefit 2.6% 5% (0.8)% Change in valuation allowance 34.7% (8.4)% (27.4)% Other 0.6% 1.8% (0.7)% Effective income tax rate 58.6% 18.1% (12.7)% The components of the deferred tax assets and liabilities are as follows: As of December 31, (in $000s) 2020 2019 Deferred tax assets Accounts receivable $ 1,729 $ 1,486 Inventory 740 1,228 Transaction and debt costs 2,609 1,231 Compensation and benefits 668 459 Net operating loss carryforwards 88,913 76,382 Section 163j interest disallowance 9,084 22,583 Foreign tax credits, accrued expenses, and other 1,977 315 Total deferred tax assets 105,720 103,684 Less: valuation allowance (16,542) (34,385) Total deferred tax assets, net 89,178 69,299 Deferred tax liabilities Rental equipment (50,554) (58,887) Intangible assets (21,672) (22,700) Total deferred tax liabilities (72,226) (81,587) Net deferred tax asset (liability) $ 16,952 $ (12,288) On December 22, 2017, H.R. 1, originally known as the Tax Cuts and Jobs Act (the “TCJA”) was enacted. The TCJA made many significant changes to the Internal Revenue Code, including, but not limited to, (1) reducing the U.S. federal corporate tax rate from 35% to 21%; (2) creating a 30% limitation on deductible interest expense; and (3) changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2018. Pursuant to the enactment of the TCJA, the Company remeasured existing deferred income tax balances as of December 31, 2018 to reflect the decrease in the corporate income tax rate from 35% to 21%, which resulted in a reduction to the net deferred income tax liability of approximately $5.2 million and a corresponding increase to deferred income tax benefit. The TCJA included new rules created to limit the deductibility of interest expense in certain circumstances. Prior to 2020, we had maintained a valuation allowance against our deferred tax assets related to federal and state net operating loss carryforwards as well as disallowed interest expense deduction carryforwards under those rules. During the year ended December 31, 2020, we recorded a reduction of our deferred tax valuation allowance, which resulted in an increase in income tax benefit of approximately $5.0 million. The reduction was a correction of valuation allowances recorded in prior annual periods. Those valuation allowances were recognized based on our prior interpretation of the manner in which the interest limitation rules impact the realizability of certain deferred tax assets. We determined that the effects of the misstatements, both on an individual and cumulative basis, were not material to our consolidated financial statements for any interim or annual period. In our revised assessment, we estimate we are more likely than not to realize certain of our federal and state deferred tax assets within the period that the carryforwards expire. In addition, in March 2020, the CARES Act reduced the amount of disallowed interest expense which resulted in a greater amount of interest deduction. As a result, during the year ended December 31, 2020, we recorded an income tax benefit of approximately $8.7 million. Additionally, on July 27, 2020, the United States Department of Treasury and Internal Revenue Service issued final regulations that provided guidance on the determination of disallowed interest expense. This guidance also resulted in net operating loss carryforwards that are estimated to be realized. As a result, during the year ended December 31, 2020, we recorded an income tax benefit of approximately $11.8 million. As of December 31, 2020 we had NOLs of approximately $363.0 million for U.S. Federal income tax purposes and $223.2 million for state income tax purposes. As of December 31, 2019, we had NOLs of approximately $285.3 million for U.S. Federal income tax purposes and $202.4 million for state income tax purposes. The NOLs expire at various dates commencing during 2027 through 2037 for U.S. Federal income tax purposes and 2021 through 2040 for state income tax purposes. We record a valuation allowance against deferred tax assets when we determine that it is more likely than not that all or a portion of a deferred tax asset will not be realized. The valuation allowance recorded relates to federal and state net operating loss carryforwards as well as disallowed interest expense deduction carryforwards The following presents changes in the valuation allowance: Year Ended December 31, (in $000s) 2020 2019 2018 Valuation allowance - beginning of year $ (34,385) $ (31,610) $ (28,384) Charged to benefit (expense) 17,843 (2,775) (3,226) Valuation allowance - end of year $ (16,542) $ (34,385) $ (31,610) |
Concentration Risks
Concentration Risks | 12 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Concentration Risks | Note 15: Concentration Risks Concentration of Credit Risks Financial instruments that potentially subject us to significant concentrations of credit risk include cash and accounts receivable. We maintain cash with federally insured financial institutions and may maintain deposits in excess of financial insured limits. However, we believe that we are not exposed to significant credit risks due to the financial position of the depository institutions in which our deposits are held. Three customers and one customer accounted for 11.1% and 10.6%, respectively, of consolidated revenue in 2020 and 2018. No customer accounted for more than 10.0% of 2019 consolidated revenue. Receivables from these customers were 12.1% of consolidated accounts receivable as of December 31, 2020. Vendor Concentrations In 2020, 2019, and 2018, three vendors accounted for more than 10.0% of purchases. One vendor represented more than 10.0% of accounts payable as of December 31, 2020 and December 31, 2019. Geographic Concentrations We rent, lease, and sell utility, telecommunications, and rail equipment throughout the United States, Canada, and Mexico. One state represented 16.4% and 20.0% of revenue for 2020 and 2019, respectively. For revenue by country and total assets by country, see Note 3, Segments . |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Parties | Note 16: Related Parties Energy Capital Partners (“ECP”) and their affiliates have ownership interests in a broad range of companies. Nesco has entered into commercial transactions in the ordinary course of its business with a subsidiary of PLH Group, Inc., a company partially owned by an affiliate of ECP. Revenues derived from these transactions have totaled $9.2 million, $11.5 million and $9.9 million, for each of the years ended December 31, 2020, 2019 and 2018, respectively. Accounts receivable at December 31, 2020 and 2019 was $3.5 million and $10.2 million, respectively. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 17: Subsequent Events On February 18, 2021, pursuant to the special meeting of our stockholders, the stockholders approved the transactions described below. Authorized Capital Stock The stockholders approved an increase to the authorized shares of common stock, par value $0.0001 per share, to 500,000,000, and shares of preferred stock, par value $0.0001 per share, to 10,000,000. Acquisition of Custom Truck On December 3, 2020, Nesco Holdings, Inc., Nesco Holdings II, Inc., certain affiliates of The Blackstone Group (“Blackstone”) and other direct and indirect equity holders of Custom Truck, Blackstone Capital Partners VI-NQ L.P., and PE One Source entered into a Purchase and Sale Agreement (the “Purchase Agreement”), pursuant to which Nesco Holdings II, Inc. agreed to acquire 100% of the limited partnership interests of Custom Truck and 100% of the limited liability company interests of Custom Truck’s general partner (the “Acquisition”). Upon consummation of the Acquisition, the equity interest holders of Custom Truck will receive a base purchase price of $1,475.0 million, subject to customary working capital adjustments, indebtedness and transaction expenses of Custom Truck as of the closing date, as well as an adjustment on the basis of the target original equipment cost of the rental fleet inventory owned by Custom Truck as of the closing date, if any. As further described below, the purchase price for the Acquisition will be financed through borrowings under a new asset-based revolving credit facility (the “New ABL Facility”), proceeds from the Subscription and the Supplemental Equity Financing, the rollover of certain equity interests of Blackstone and certain members of the management of Custom Truck whereby the sellers will receive 20,000,000 shares of Nesco common stock at closing, cash on hand, and proceeds from the private placement of senior secured high-yield notes. In connection with entering into the Purchase Agreement, Nesco entered into the Debt Commitment Letter pursuant to which certain lenders have agreed to provide a portion of the financing necessary to fund the consideration to be paid pursuant to the terms of the Purchase Agreement. The financing is anticipated to consist of the following: (i) an asset-based revolving credit facility in an aggregate principal amount of up to $750.0 million, $400.0 million of which shall be available on the closing date to finance the purchase price or, when determined, for working capital adjustments payable under the Purchase Agreement; and (ii) an issuance of senior secured notes (the “Notes”) yielding approximately $1,000.0 million in gross cash proceeds and/or to the extent that the issuance of the Notes yields less than $1,000.0 million in gross cash proceeds or such cash proceeds are otherwise unavailable to consummate the Acquisition, loans under a senior secured bridge facility yielding up to approximately $1,000.0 million in gross cash proceeds (less the gross cash proceeds received from the Notes and available for use, if any). The acquisition is expected to be accounted for using the acquisition method of accounting under the provisions of ASC 805, Business Combinations, with Nesco as the accounting acquirer of Custom Truck. In identifying Nesco as the accounting acquirer, management considered the structure of the transaction and other actions contemplated by the Purchase Agreement, including the composition of purchase consideration that will be issued to the selling equity holders of Custom Truck (consisting of cash from Nesco and Nesco common stock). Nesco also considered the relative outstanding share ownership and the composition of the combined company board following completion of the Acquisition. ASC 805 requires, among other things, that the assets acquired and liabilities assumed in a business combination be recognized at their fair values as of the acquisition date. Equity Investment |
Condensed Financial Information
Condensed Financial Information of Nesco Holdings, Inc. | 12 Months Ended |
Dec. 31, 2020 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of Nesco Holdings, Inc. | Nesco Holdings, Inc. Condensed Parent Company Balance Sheets (in $000s, except share data) December 31, 2020 December 31, 2019 Deferred income taxes $ 24,869 $ — Total Assets $ 24,869 $ — Liabilities and Stockholders' Deficit Deferred income taxes $ — $ 5,205 Negative investment in subsidiaries 61,105 12,111 Total long-term liabilities 61,105 17,316 Commitments and contingencies (see Note 3) Stockholders' Deficit Common stock - $0.0001 par value, 250,000,000 shares authorized, 49,156,753 and 49,033,903 issued and outstanding, at December 31, 2020 and 2019, respectively 5 5 Additional paid-in capital 429,748 427,391 Accumulated (deficit) (465,989) (444,712) Accumulated other comprehensive loss — — Total stockholders' deficit (36,236) (17,316) Total Liabilities and Stockholders' Deficit $ 24,869 $ — See accompanying notes to consolidated financial statements. Nesco Holdings, Inc. Condensed Parent Company Statements of Operations Year Ended December 31, (in $000s, except share and per share data) 2020 2019 2018 Operating Expenses Selling, general, and administrative expenses $ 2,357 $ 816.00 $ — Total operating expenses 2,357 816 — Operating Loss (2,357) (816.00) — Other Expense Equity in net loss of subsidiaries 48,994 32,222 13,821 Other expense — — — Total other expense 48,994 32,222 13,821 Loss Before Income Taxes (51,351) (33,038) (13,821) Income Tax (Benefit) Expense (30,074) (5,986) 1,705 Net Loss $ (21,277) $ (27,052) $ (15,526) See accompanying notes to consolidated financial statements. Nesco Holdings, Inc. Condensed Parent Company Statements of Comprehensive Loss Year Ended December 31, (in $000s) 2020 2019 2018 Net loss $ (21,277) $ (27,052) $ (15,526) Other comprehensive loss Interest rate collar (net of taxes of $285 in 2019) — 396 (396) Other comprehensive loss — 396 (396) Comprehensive loss $ (21,277) $ (26,656) $ (15,922) S ee accompanying notes to consolidated financial statements. Nesco Holdings, Inc. Condensed Parent Company Statements of Cash Flows Year Ended December 31, (in $000s) 2020 2019 2018 Net cash flow from operating activities $ (48,994) $ (179,491) $ (14,430) Investing Activities Changes in investment in subsidiaries 48,994 32,222 14,430 Net cash flow from investing activities 48,994 32,222 14,430 Proceeds from merger and recapitalization — 147,269 — Net cash flow from financing activities — 147,269 — Net Change in Cash — — — Cash at Beginning of Period — — — Cash at End of Period $ — $ — $ — See accompanying notes to consolidated financial statements. Nesco Holdings, Inc. Notes to Condensed Parent Company Financial Statements Note 1: Basis of Presentation Nesco Holdings, Inc. (“Holdings”), a Delaware corporation, serves as the parent for its primary operating company, NESCO, LLC. NESCO, LLC, an Indiana limited liability company and is engaged in the business of providing a range of services and products to customers through rentals of specialty equipment, sales of parts related to the specialty equipment, and repair and maintenance services related to that equipment. Holdings’ wholly-owned subsidiaries include Capitol Intermediate Holdings, LLC, Capitol Investment Merger Sub 2, LLC, NESCO Holdings II, Inc., NESCO, LLC, NESCO Finance Corporation, NESCO Investments, LLC, NESCO International, LLC, and El Alquiler S. de R.L. de C.V. These parent company condensed financial statements should be read in conjunction with the Holdings consolidated financial statements and the accompanying notes thereto. For purposes of these condensed financial statements, Holdings’ wholly owned subsidiaries are recorded based upon its proportionate share of the subsidiaries’ net assets (similar to presenting them on the equity method). On April 7, 2019, NESCO Holdings I, Inc. (who was the parent company prior to the consummation of the transaction), entered into a definitive agreement with Capitol Investment Corp. IV. Refer to Note 1, Business and Organization , under the heading entitled “Merger with Capitol Investments Corp. IV” to the Holdings consolidated financial statements for information about this transaction. Note 2: Debt Holdings’ subsidiaries have debt obligations under a revolving credit facility that are guaranteed by Holdings and each of its direct and indirect, existing and future, material wholly-owned domestic subsidiaries. Obligations under the revolving credit facility will be secured by a first-priority lien on substantially all the assets of Holdings and its subsidiaries. The obligations contain customary financial and non-financial covenants, including covenants that impose restrictions on, among other things, additional indebtedness, liens, investments, advances, guarantees and mergers and acquisitions. These covenants also place restrictions on asset sales, dividends and certain transactions with affiliates. Refer to Note 10, Debt and Capital Leases , to the Holdings consolidated financial statements for information about Holdings’ subsidiaries’ debt obligations. Note 3: Commitments and Contingencies Refer to Note 9, Commitments and Contingencies , to the Holdings consolidated financial statements for information about commitments and contingencies. Note 4: Income Taxes Refer to Note 14, Income Tax , to the Holdings consolidated financial statements for information about Holdings’ subsidiaries’ income taxes. Note 5: Subsequent Events Refer to Note 17, Subsequent Events |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of PresentationOur accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) and the accounting policies described below. Our consolidated financial statements include the accounts of all wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates We prepare our consolidated financial statements in conformity with GAAP, which requires us to use judgment to make estimates that directly affect the amounts reported in our consolidated financial statements and accompanying notes. Significant estimates are used for items including, but not limited to, the useful lives and residual values of our rental equipment, business combinations and determining the valuation allowance related to deferred income taxes. In addition, estimates are used to test both long-lived assets, goodwill and indefinite-lived assets for impairment, and to determine the fair value of impaired assets, if any impairment exists. These estimates are based on our historical experience and on various other assumptions we believe to be reasonable under the circumstances. We review our estimates on an ongoing basis using information currently available, and we revise our recorded estimates as updated information becomes available, facts and circumstances change, or actual amounts become determinable. Actual results could differ from our estimates. |
Accounts Receivable, net of Allowance | Accounts Receivable, net of Allowance Accounts receivable are stated at invoiced amounts and are ordinarily due upon receipt of invoice. We record an allowance for doubtful accounts based on receivable aging. We also establish customer specific reserves for accounts with known collection problems due to insolvency, disputes, or other issues. Accounts more than 90 days past due are considered delinquent. Delinquent receivables are written off when the amount is deemed uncollectible based on individual credit evaluations and specific circumstances related to the customer. Bad debt expense is included in selling, general, and administrative expenses on our Consolidated Statements of Operations. |
Inventory | Inventory Parts, tools and accessories inventory is primarily comprised of items purchased for resale or rent to customers. During the second quarter ended June 30, 2020, in connection with a new inventory management system, we elected to change our method for these inventories, which were previously valued using the first-in, first-out (“FIFO”) method, to the moving average cost method. We believe the change is preferable because it better reflects movement of the inventory and the corresponding value which provides a better reflection of periodic income from operations. This change was not applied retrospectively to prior periods, as the effect of the change was not material to our consolidated financial statements, including interim periods. |
Property and Equipment / Rental Equipment | Property and Equipment Property and equipment is comprised of construction in progress, building improvements, machinery and equipment, and office equipment, and is carried at cost, net of accumulated depreciation. Depreciation of building improvements, machinery and equipment and office equipment is provided using the straight-line method based on useful lives ranging from three years to 15 years. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. Leasehold improvements are depreciated over the lesser of the improvement’s useful life or the remaining lease term. Depreciation expense related to non-rental property and equipment used in our rental operations was $0.8 million in 2020 ($0.9 million in 2019 and 2018) and is classified within “cost of rental revenue”. We include rental equipment inventory received that is purchased for deployment in our rental fleet, in property and equipment (construction in progress) when received. Following the completion of a quality inspection of a rental equipment unit, we reclassify the unit to rental equipment (see below). Rental Equipment Rental equipment is comprised of the cost of bucket trucks, digger derricks, line equipment, cranes, pressure diggers and underground equipment. The rental equipment we purchase is recorded at cost and depreciated over the estimated rentable life of the equipment using the straight-line method over a 7-year period to a 15% estimated residual value. Depreciation of rental equipment commences when a rental unit is placed into the rental fleet and becomes available to rent and the cost is depreciated whether or not the equipment is on rent. We reevaluate the estimated rentable life as rental equipment is purchased, estimating the period that the asset will be held, considering such factors as historical rental activity and expectations of future rental activity. We reevaluate the estimated residual values of the applicable rental equipment. The residual value of equipment is affected by factors that include equipment age and amount of usage. Market conditions for used equipment sales can also be affected by external factors such as the economy, natural disasters, fuel prices, supply of similar used equipment, the market price for similar new equipment and incentives offered by manufacturers of new equipment. These factors are considered when estimating future residual values and depreciation periods. Expenditures for repair and maintenance that extend the useful life of the equipment and are necessary to keep an equipment unit in rentable condition are capitalized and depreciated over the estimated remaining useful life of the equipment, which is the period the repair and maintenance is expected to provide future economic benefit. When making repairs, we dispose of damaged and replaced components at their net carrying values. The cost of these disposed components is expensed as major repairs expense in the Consolidated Statements of Operations. The cost of routine and recurring maintenance activities related to the rental fleet are charged to expense as incurred. Rental equipment also includes the cost of parts, tools, and accessories that are rented to customers. The cost of these parts, tools and accessories is depreciated over a five-year estimated rentable life to no residual value. Depreciation of rented parts, tools and accessories commences when the asset is placed on rent with a customer. |
Impairment of Long-Lived Assets, including Intangible Assets | Impairment of Long-Lived Assets, including Intangible Assets We evaluate the carrying value of long-lived assets held for use, including rental equipment and definite-lived intangible assets, for impairment whenever an event or circumstance has occurred (such as a significant adverse change in the business climate, operating performance metrics, or legal factors) which suggests that the carrying value may not be recoverable. Impairment of a long-lived asset held for use (or relative asset group, if applicable) is measured when the anticipated separately identifiable undiscounted cash flows from the asset are less than the carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value. Fair value is determined primarily using anticipated cash flows discounted at a rate commensurate with the risk involved. Other intangible assets consist of customer relationships, non-compete agreements and trade names. We amortize intangible assets with finite lives over the period the economic benefits are estimated to be consumed. Customer relationships are amortized using the straight-line method over their useful life, as we believe this method best matches the pattern of economic benefit. See Note 6, Goodwill and Other Intangible Assets , for additional information. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets We recognize goodwill when the purchase price of an acquired business exceeds the fair value of net assets acquired. Goodwill is not amortized for financial reporting purposes. Goodwill is impaired when its carrying value exceeds its implied fair value. We perform our goodwill impairment analysis annually on October 1 or more frequently if an event or circumstance (such as a significant adverse change in the business climate, operating performance metrics, or legal factors) indicates that an impairment may have occurred. For our analysis conducted as of October 1, 2020, 2019 and 2018 we tested for impairment by comparing the estimated fair values of our reporting units to their carrying value, including goodwill. If the fair value of the reporting unit exceeds its carrying value, goodwill of the reporting unit is not considered impaired. If the carrying value of the reporting unit exceeds its fair value, then there is an indication impairment may exist. We estimate the fair value of our reporting units using an income approach based on the present value of estimated future cash flows. We believe this approach yields the most appropriate evidence of fair value. Determining the fair value of our reporting units is judgmental and involves the use of significant estimates and assumptions. We based our fair value estimates on assumptions that we believe are reasonable. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for our reporting units. |
Deferred Financing Costs | Deferred Financing Costs Direct costs incurred in connection with the issuance, and amendments thereto, of our debt are capitalized and amortized over the terms of the respective agreements using the effective interest method, or the straight-line method when not materially different than the effective interest method. The net carrying value of deferred financing costs are classified as a reduction to long-term debt in the Consolidated Balance Sheets (see Note 10). The amortization is included in interest expense on our Consolidated Statements of Operations. |
Derivative Instruments Designated as Hedges | Derivatives Instruments Designated as Hedges When a derivative contract is entered into, the Company may designate the derivative instrument as a cash flow hedge of a forecasted transaction, a cash flow hedge of a recognized asset or liability or as an undesignated derivative. When a derivative is designated, the Company formally documents its hedge relationships, including identification of the derivative instruments and the hedged items, as well as its risk management objectives and strategies for undertaking the hedge transaction. This process includes linking derivative instruments that are designated as hedges to specific assets, liabilities or forecasted transactions. The fair market value of derivative instruments is determined through market-based valuations and may not be representative of the actual gains or losses that will be recorded when these instruments mature due to future fluctuations in the markets in which they are traded. The Company assesses at inception and at least quarterly thereafter, whether the derivatives used in cash flow hedging transactions are effective in offsetting the changes in the cash flows of the hedged item. To the extent the derivative is deemed to be an effective hedge, the fair market value changes of the instrument are recorded to accumulated other comprehensive income (loss) and subsequently reclassified into net income (loss) when the hedged transaction affects earnings. Changes in the fair market value of derivatives not deemed to be an effective hedge are recorded in the Consolidated Statements of Operations in the period of change. If the hedging relationship ceases to be effective subsequent to inception, or it becomes probable that a forecasted transaction is no longer expected to occur, the hedging relationship will be undesignated and any future gains and losses on the derivative instrument will be recorded in the Consolidated Statements of Operations. |
Fair Value Measurements | Fair Value Measurements Fair value is defined as an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. Fair value is a market-based measurement that is determined based on inputs, which refer broadly to assumptions that market participants use in pricing assets and liabilities. These inputs can be readily observable, market corroborated, or generally unobservable. Fair Value Hierarchy In measuring fair value, we use observable market data when available and minimize the use of unobservable inputs. Unobservable inputs may be required to value certain financial instruments due to complexities in contract terms. Inputs used in fair value measurements are categorized into three fair value hierarchy levels for disclosure purposes. The entire fair value measurement is categorized based on the lowest level of input that is significant to the fair value measurement. The three levels of the fair value hierarchy are: Level 1 Inputs that reflect unadjusted quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur with both sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 Inputs that reflect quoted prices for similar assets and liabilities are available in active markets, and inputs other than quoted prices that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments. Level 3 Inputs that are generally less observable or from unobservable sources in which there is little or no market data. These inputs may be used with internally developed methodologies that result in our best estimate of fair value. Valuation Techniques Assets and liabilities measured at fair value are based on one or more of the following three valuation techniques: Market approach Technique that uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. Income approach Technique that converts future amounts to a single present amount based upon market expectations (including present value techniques, option-pricing, and excess earnings models). Cost approach Technique that estimates the amount that would be required to replace the service capacity of an asset (i.e. replacement cost). Assets and Liabilities with Recurring Fair Value Measurements Certain assets and liabilities may be measured at fair value on an ongoing basis. We did not elect to apply the fair value option for recording financial assets and financial liabilities. Other than the interest rate collar, we do not have any assets or liabilities which we measure at fair value on a recurring basis. |
Revenue Recognition | Revenue Recognition We recognize revenue in accordance with two different accounting standards: 1) Topic 606 and 2) Topic 840, which addresses lease accounting, for which we will adopt an update to this standard using the full retrospective approach, as described herein. For the years ended December 31, 2020, 2019 and 2018, we recognized rental revenue in accordance with Topic 840 Leases, which is the lease accounting standard. Rental Revenue. Our rental contracts are for various equipment, parts, tools, and accessories under 28 day or monthly agreements which include automatic renewal provisions. The majority of our rental payments are due upon receipt, with a majority that are billed at the end of each 28-day or monthly period. Revenue is recognized ratably over the rental agreement period and in accordance with Accounting Standards Codification 840, Leases (“Topic 840”). Unearned revenue is reported in our Deferred rent income line of our Consolidated Balance Sheets. We had deferred revenue of $1.0 million as of December 31, 2020 and $2.3 million as of December 31, 2019 Equipment Sales. We sell both new and used equipment. The contractual sales price for each individual product represents the standalone selling price. Our used equipment is of a sufficiently unique nature - based on the specifics of its age, usage, etc. - in that it does not have an observable standalone selling price. Equipment sales revenue is recognized when equipment is delivered, which is when the transfer of title, risks and rewards of ownership, and control are considered passed to the customer. Payment is usually due within 30 days subsequent to transfer of control of the asset. There are no rights of return or warranties offered on equipment sales. Parts Sales and Services. We sell parts, tools and accessories. We derive our services revenue primarily from maintenance, repair and upfit services on heavy-duty trucks and cranes. Revenue from these services includes parts sales needed to complete the service work. We recognize services revenue when the service work is completed. We record revenue on a point in time basis as parts are delivered. The amount of consideration we receive for parts is based upon a list price net of discounts and incentives, and the impact of such variable consideration is factored into the amount of revenue we recognize at any point in time. The amount of consideration received for service is based upon labor hours expended and parts utilized to perform and complete the necessary services for our customers. There are no rights of return or warranties offered on parts sales. Payment is usually due and collected within 30 days subsequent to delivery of parts or performance of service. We record sales tax billed to customers and remitted to governmental authorities on a net basis and, consequently, these amounts are excluded from revenues and expenses. Sales taxes are recorded as accrued expenses when billed. Shipping and Handling Costs |
Advertising Cost | Advertising Costs We promote our business through various industries media channels, and expense advertising costs as incurred. |
Licensing and Titling Expenses | Licensing and Titling ExpensesThe costs of licensing related to our vehicles, including rental equipment, is recorded in Prepaid expenses and other assets on our Consolidated Balance Sheets. The licensing cost is recognized as licensing and titling expense over the license period. Costs for titling our vehicles, including rental equipment, is expensed as incurred. |
Share-Based Compensation | Share-Based CompensationThe fair value of equity-classified awards is determined at the grant date using techniques appropriate for the awards, which we use to determine compensation expense over the service period. The fair value of liability-classified awards is determined at the grant date and is remeasured at the end of each reporting period through the date of settlement and adjusted through compensation expense. We recognize compensation expense for our share-based payments over the requisite service period for the entire award. |
Income Taxes | Income Taxes We utilize the asset and liability method in accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between financial accounting and tax bases of assets and liabilities and are measured using the tax rates and laws that are expected to be in effect when the differences are expected to reverse. Recognition of deferred tax assets is limited to amounts considered by management to be more-likely-than-not to be realized in future periods. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. The effect on net deferred tax assets and liabilities resulting from a change in tax rates is recognized as income or expense in the period that the change in tax rates is enacted. We make certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments are applied in the calculation of the deferred income tax expense or benefit associated with certain deferred tax assets and liabilities. Significant changes to these estimates may result in an increase or decrease to our tax provision in a subsequent period. Our income tax returns are subject to examination by federal, state and foreign tax authorities. There may be differing interpretations of tax laws and regulations, and as a result, disputes may arise with these tax authorities involving the timing and amount of deductions and allocation of income. With the exception of net operating loss carryforwards (“NOLs”), we are no longer subject to federal, state, local, and foreign income tax examinations by tax authorities for years ending on or prior to December 31, 2016. |
Acquisition Accounting | Acquisition Accounting We have made acquisitions in the past and may continue to make acquisitions in the future. The assets acquired and liabilities assumed are recorded based on their respective fair values at the date of acquisition. Long-lived assets (principally rental equipment), goodwill and other intangible assets generally represent the largest components of our acquisitions. Rental equipment is valued utilizing either a cost, market or income approach, or a combination of certain of these methods, depending on the asset being valued and the availability of market or income data. The intangible assets that we have acquired are non-compete agreements, customer relationships and trade names and associated trademarks. The estimated fair values of these intangible assets reflect various assumptions about discount rates, revenue growth rates, operating margins, terminal values, useful lives and other prospective financial information. Goodwill is calculated as the excess of the cost of the acquired entity over the net of the fair value of the assets acquired and the liabilities assumed. Non-compete agreements, customer relationships and trade names and associated trademarks are valued based on an excess earnings or income approach based on projected cash flows. Determining the fair value of the assets and liabilities acquired is judgmental in nature and can involve the use of significant estimates and assumptions. The judgments made in determining the estimated fair value assigned to the assets acquired, as well as the estimated life of the assets, can materially impact net income (loss) in periods subsequent to the acquisition because of depreciation and amortization, and in certain instances through impairment charges if the asset becomes impaired in the future. As discussed above, we regularly review long-lived assets for impairments. When we make an acquisition, we also acquire other assets and assume liabilities. These other assets and liabilities typically include, but are not limited to, parts inventory, accounts receivable, accounts payable and other working capital items. Because of their short- |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012. Accordingly, we have elected to comply with certain reduced public company reporting requirements related to effective dates for the adoption of newly issued standards issued by the Financial Accounting Standards Board (the “FASB”). An emerging growth company is permitted to apply the effective dates applicable to non-public entities, which generally are delayed in comparison to public entities that are non-emerging growth entities. As a result of the transactions described in Note 17, Subsequent Events , we anticipate that we will lose our emerging growth company status. A company continues to be an emerging growth company until one of the following occurs: (i) annual revenue exceeds $1.07 billion; (ii) non-convertible debt of more than $1.0 billion is issued in the past three years; or, (iii) the company becomes a large accelerated filer, as defined in Exchange Act Rule 12b-2. As a result of losing such status, we will no longer be able to take advantage of the later adoption dates for the pronouncement described below. Leases The FASB’s new guidance to account for leases (“Topic 842”) by entities that are lessees, requires (1) recognition of lease assets and lease liabilities on the balance sheet and (2) disclosure of key information about leasing arrangements. Topic 842 provides two classifications for leases: financing or operating. Finance leases. The accounting and recognition for leases qualifying as finance leases is similar to the accounting and recognition required under ASC Topic 840, " Leases (“Topic 840”)," for capital leases. As of December 31, 2020, we have capital lease obligations of approximately $10.5 million When we make our contractually required payments under the capital leases, we allocate a portion to reduce the capital lease obligation and a portion is recognized as interest expense. The assets leased under the capital leases are included in rental equipment, and depreciation thereon is recognized in cost of rental revenue. Operating leases. Under Topic 842, operating leases result in the recognition of right-of-use (“ROU”) assets and lease liabilities on the balance sheet. ROU assets represent our right to use the leased asset for the lease term and lease liabilities represent our obligation to make lease payments. Under Topic 842, operating lease ROU assets and liabilities are recognized at the lease commencement date and measured based on the present value of lease payments over the lease term. The operating lease ROU assets will also include any lease payments made and exclude lease incentives. Our lease terms may include options to extend or terminate the lease that we are reasonably certain to exercise. Lease expense under Topic 842 will be recognized on a straight-line basis over the lease term. Upon adoption of Topic 842, we expect to recognize operating lease ROU assets and lease liabilities that reflect the present value of these future payments, which we currently estimate to be in the range of $6.9 million to $7.9 million. The FASB issued new guidance with respect to deferring the effective date of Topic 842 by one year. Accordingly, we will adopt Topic 842 effective January 1, 2022 or the interim period in which we lose emerging growth company status, using the transition method that allows us to recognize a cumulative-effect adjustment to the opening balance of accumulated deficit in the period of adoption. A modified retrospective approach is required for adoption for all leases that exist at or commence after the date of initial application with an option to use certain practical expedients. We expect to use the package of practical expedients that allows us to not reassess: (1) whether any expired or existing contracts are or contain leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. Under Topic 842, lessor accounting will remain substantially similar to the current accounting; however, certain refinements were made to conform the standard with the recently issued revenue recognition guidance in ASC Topic 606," Revenue from Contracts with Customers (“Topic 606”)," specifically related to the allocation and recognition of contract consideration earned from lease and non-lease revenue components. On July 30, 2018, the FASB issued ASU 2018-11, which created a practical expedient that provides lessors an option not to separate lease and non-lease components when certain criteria are met and instead account for those components as a single lease component. We are currently in the process of evaluating whether our lease arrangements will meet the criteria under the practical expedient to account for lease and non-lease components as a single lease component, which would alleviate the requirement upon adoption of Topic 842 that we reallocate or separately present lease and non-lease components. Measurement of Current Expected Credit Losses In June 2016, the FASB issued ASU 2016-13 (the “ASU”), “ Financial Instruments - Credit Losses, “Measurement of Credit Losses on Financial Instruments .” The ASU adds to U.S. GAAP an impairment model (known as the current expected credit loss, or “CECL,” model) that is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes as an allowance its estimate of expected credit losses, which is intended to result in the more timely recognition of losses. Under the CECL model, entities will estimate credit losses over the entire contractual term of the instrument (considering estimated prepayments, but not expected extensions or modifications) from the date of initial recognition of the financial instrument. Measurement of expected credit losses are to be based on relevant forecasts that affect collectability. The scope of financial assets within the CECL methodology is broad and includes trade receivables from certain revenue transactions and certain off-balance sheet credit exposures. While our review is ongoing, we believe the ASU will only have applicability to our receivables from non-leasing revenue transactions, as ASU 2016-13 does not apply to receivables arising from operating leases. At the point that non-leasing trade receivables are recorded, they become subject to the CECL model and estimates of expected credit losses on receivables over their contractual life will be required to be recorded at inception based on historical information, current conditions, and reasonable and supportable forecasts. We are currently evaluating whether the new guidance, while limited to our non-operating lease trade receivables, will have an impact on our consolidated financial statements. ASU 2016-13 must be adopted using a modified retrospective transition method through a cumulative-effect adjustment to retained earnings (deficit) in the period of adoption. ASU 2016-13 is effective for fiscal years beginning after December 15, 2022 or the interim period in which we lose emerging growth company status. Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued ASU 2017-04, “Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment (Topic 350)," intended to simplify the subsequent accounting for goodwill acquired in a business combination. Prior guidance required utilizing a two-step process to review goodwill for impairment. A second step was required if there was an indication that an impairment may exist, and the second step required calculating the potential impairment by comparing the implied fair value of a reporting unit’s goodwill (as if purchase accounting were performed on the testing date) to the carrying amount of the goodwill. The new guidance eliminates the second step from the goodwill impairment test. Under the new guidance, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and then recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value (although the loss should not exceed the total amount of goodwill allocated to the reporting unit). The guidance requires prospective adoption and will be effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2021 or the interim period in which we lose emerging growth company status. Early adoption of this guidance is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. We do not believe adoption of this standard will have a significant impact on our consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Accounts Receivable | As of December 31, accounts receivable, net of allowance consisted of the following: (in $000s) 2020 2019 Trade receivables $ 67,305 $ 75,977 Less: allowance for doubtful accounts (6,372) (4,654) Accounts receivable, net of allowance $ 60,933 $ 71,323 |
Schedule of Allowance for Doubtful Accounts | The relationship between bad debts expense and allowance for doubtful accounts is presented below: (in $000s) 2020 2019 2018 Allowance - beginning of period $ 4,654 $ 7,562 $ 4,404 Accounts written off during period (1,410) (6,208) (1,144) Recoveries (637) (701) (177) Bad debts expense 3,765 4,001 4,479 Allowance - end of period $ 6,372 $ 4,654 $ 7,562 |
Schedule of Inventory | As of December 31, inventory consisted of the following: (in $000s) 2020 2019 Parts, tools and accessories inventory $ 28,091 $ 30,174 Equipment inventory 3,276 2,827 Total inventory $ 31,367 $ 33,001 |
Schedule of Accrued Expenses | As of December 31, accrued expenses consisted of the following: (in $000s) 2020 2019 Accrued interest $ 20,478 $ 20,629 Accrued salaries, wages and benefits 3,176 4,164 Accrued sales taxes 1,703 1,444 Other, including transaction expenses 6,634 1,353 Total accrued expenses $ 31,991 $ 27,590 |
Schedule of Revenue Types Based On Accounting Standard | Year Ended December 31, 2020 (in $000s) Topic 840 Topic 606 Total Rental: Rental revenue $ 187,522 $ — $ 187,522 Shipping and handling — 7,968 7,968 Total rental revenue 187,522 7,968 195,490 Sales and services: Sales of rental equipment — 31,533 31,533 Sales of new equipment — 25,099 25,099 Parts and services — 50,617 50,617 Total sales and services — 107,249 107,249 Total revenue $ 187,522 $ 115,217 $ 302,739 Year Ended December 31, 2019 (in $000s) Topic 840 Topic 606 Total Rental: Rental revenue $ 189,161 $ — $ 189,161 Shipping and handling — 8,835 8,835 Total rental revenue 189,161 8,835 197,996 Sales and services: Sales of rental equipment — 23,767 23,767 Sales of new equipment — 10,308 10,308 Parts and services — 31,964 31,964 Total sales and services — 66,039 66,039 Total revenue $ 189,161 $ 74,874 $ 264,035 Year Ended December 31, 2018 (in $000s) Topic 840 Topic 606 Total Rental: Rental revenue $ 177,032 $ — $ 177,032 Shipping and handling — 7,531 7,531 Total rental revenue 177,032 7,531 184,563 Sales and services: Sales of rental equipment — 26,019 26,019 Sales of new equipment — 18,349 18,349 Parts and services — 17,366 17,366 Total sales and services — 61,734 61,734 Total revenue $ 177,032 $ 69,265 $ 246,297 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Summary of Financial Information by Segment | The following tables present our financial information by segment: Year Ended December 31, 2020 (in $000s) ERS PTA Total Rental revenue $ 179,933 $ 15,557 $ 195,490 Sales of rental equipment 31,533 — 31,533 Sales of new equipment 25,099 — 25,099 Parts sales and services — 50,617 50,617 Total revenue 236,565 66,174 302,739 Cost of revenue 103,547 44,217 147,764 Depreciation of rental equipment 74,376 4,156 78,532 Gross profit $ 58,642 $ 17,801 $ 76,443 Year Ended December 31, 2019 (in $000s) ERS PTA Total Rental revenue $ 182,720 $ 15,276 $ 197,996 Sales of rental equipment 23,767 — 23,767 Sales of new equipment 10,308 — 10,308 Parts sales and services — 31,964 31,964 Total revenue 216,795 47,240 264,035 Cost of revenue 76,573 30,346 106,919 Depreciation of rental equipment 66,228 4,340 70,568 Gross profit $ 73,994 $ 12,554 $ 86,548 Year Ended December 31, 2018 (in $000s) ERS PTA Total Rental revenue $ 173,267 $ 11,296 $ 184,563 Sales of rental equipment 26,019 — 26,019 Sales of new equipment 18,349 — 18,349 Parts sales and services — 17,366 17,366 Total revenue 217,635 28,662 246,297 Cost of revenue 84,509 16,077 100,586 Depreciation of rental equipment 60,436 3,657 64,093 Gross profit $ 72,690 $ 8,928 $ 81,618 |
Reconciliation of Segment Gross Profit to Consolidated Loss Before Income Taxes | The following table presents a reconciliation of segment gross profit to consolidated loss before income taxes: Year Ended December 31, (in $000s) 2020 2019 2018 Gross profit $ 76,443 $ 86,548 $ 81,618 Selling, general and administrative expenses 43,464 34,667 32,718 Licensing and titling expenses 2,945 2,617 2,241 Amortization and non-rental depreciation 3,248 3,122 3,045 Transaction expenses 6,627 7,641 440 Asset impairment — 657 — Other operating expenses 2,911 1,826 10 Other (income) expense 5,399 1,690 287 Loss on extinguishment of debt — 4,005 — Interest expense, net 63,200 63,361 56,698 Loss before income taxes $ (51,351) $ (33,038) $ (13,821) |
Summary of Revenue by Country | The following tables present revenue by country and total assets by country: Year Ended December 31, (in $000s) 2020 2019 2018 Revenue: United States $ 295,125 $ 257,297 $ 237,815 Canada 5,827 5,705 6,297 Mexico 1,787 1,033 2,185 $ 302,739 $ 264,035 $ 246,297 |
Summary of Total Assets by Country | December 31, (in $000s) 2020 2019 Assets: United States $ 762,696 $ 802,516 Canada 5,447 8,152 Mexico 261 4,616 $ 768,404 $ 815,284 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of Assets Acquired and Liabilities Assumed | The fair value of the assets acquired and liabilities assumed as of the acquisition dates were as follows: 2019 2018 (in $000s) Truck Utilities (November 4, 2019) N&L Cash $ 3,094 $ 69 Accounts receivable 3,029 559 Inventory 4,178 270 Other current assets 155 — Property and equipment 78 474 Rental equipment 38,780 1,056 Customer relationships 2,110 1,610 Trademarks 750 530 Non-competition agreements 140 90 Total identifiable assets acquired 52,314 4,658 Accounts payable and other liabilities (10,132) (378) Note payable — (504) Total liabilities assumed (10,132) (882) Goodwill 9,338 1,189 Total consideration $ 51,520 $ 4,965 |
Business Acquisition, Pro Forma Information | The following unaudited pro forma information is presented for comparison purposes as if the Truck Utilities acquisition was completed as of January 1, 2018 (pro forma information related to N&L is not material to the Company’s consolidated results): (in $000s) 2019 2018 Total revenue $ 301,450 $ 291,141 Net loss (24,576) (14,875) Basic and diluted net loss per share (0.74) (0.69) |
Rental Equipment and Property_2
Rental Equipment and Property Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Rental Equipment and Property Equipment | As of December 31, rental equipment, net and property and equipment, net, consisted of the following: (in $000s) 2020 2019 Rental equipment $ 654,547 $ 658,564 Less: accumulated depreciation (318,735) (275,144) Rental equipment, net $ 335,812 $ 383,420 (in $000s) 2020 2019 Property and equipment $ 11,816 $ 10,082 Less: accumulated depreciation (8,137) (7,168) Construction in progress 2,590 3,647 Property and equipment, net $ 6,269 $ 6,561 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Goodwill | As of December 31, the balances of goodwill and intangible assets were as follows: (in $000s) Amortization Gross Accumulated Net Intangible 2020 Goodwill $ 238,052 $ — $ 238,052 Other intangible assets, net: Nesco trade name Indefinite 28,000 — 28,000 Trade names 15 years 1,780 (284) 1,496 Non-compete agreements 1-3 years 520 (475) 45 Customer relationships 15-20 years 52,170 (14,132) 38,038 Total other intangible assets 82,470 (14,891) 67,579 Goodwill and other intangible assets, net $ 320,522 $ (14,891) $ 305,631 (in $000s) Amortization Gross Accumulated Net Intangible 2019 Goodwill $ 238,195 $ — $ 238,195 Other intangible assets, net: Nesco trade name Indefinite 28,000 — 28,000 Trade names 15 years 1,030 (128) 902 Non-compete agreements 3 years 380 (245) 135 Customer relationships 15-20 years 52,880 (11,365) 41,515 Total other intangible assets, net 82,290 (11,738) 70,552 Goodwill and other intangible assets, net $ 320,485 $ (11,738) $ 308,747 |
Schedule of Amortization Expense on Intangibles | As of December 31, 2020, our estimated amortization expense for other intangible assets for each of the next five years and thereafter is estimated to be as follows: (in $000s) 2021 $ 3,015 2022 3,015 2023 3,008 2024 2,997 2025 2,997 Thereafter 24,547 Total $ 39,579 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Carrying Values and Fair Values of Financial Liabilities | The following table sets forth the carrying values (exclusive of deferred financing fees) and fair values of our financial liabilities as of December 31: Fair Value (in $000s) Carrying Value Level 1 Level 2 Level 3 2020 2019 Credit Facility $ 250,971 $ — $ 250,971 $ — Senior Secured Notes due 2024 475,000 — 519,379 — Notes Payable 2,379 — 2,379 — Derivative 7,012 — 7,012 — 2019 2019 Credit Facility $ 250,000 $ — $ 250,000 $ — Senior Secured Notes due 2024 475,000 — 494,000 — Notes Payable 3,525 — 3,650 — Derivative 1,709 — 1,709 — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments for Operating Leases | As of December 31, 2020, minimum lease payments for each of the next five years and thereafter were as follows: (in $000s) 2021 $ 2,727 2022 2,097 2023 1,721 2024 1,135 2025 475 Thereafter 1,607 Total $ 9,762 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Obligations | Debt obligations and associated interest rates consisted of the following as of December 31: (in $000s) 2020 2019 2020 2019 2019 Credit Facility $ 250,971 $ 250,000 3.4% 4.2% Senior Secured Notes due 2024 475,000 475,000 10.0% 10.0% Notes Payable 2,379 3,525 Total debt outstanding 728,350 728,525 Deferred finance fees (11,212) (14,222) Net debt 717,138 714,303 Less current maturities (1,280) (1,280) Long-term debt $ 715,858 $ 713,023 |
Schedule of Future Minimum Capital Lease Payments | As of December 31, 2020, future payments under capital lease obligations are as follows: (in $000s) Capital Leases 2021 $ 5,885 2022 4,175 2023 1,617 Total 11,677 Less amounts representing interest (1,151) Capital lease obligations, including current portion $ 10,526 |
Schedule of Principal Payments of Debt | As of December 31, 2020, the principal payments of debt outstanding over the next five years and thereafter were as follows: (in $000s) Notes Payable Long-Term Debt 2021 $ 1,280 $ — 2022 550 — 2023 549 — 2024 — 725,971 Total 2,379 725,971 Less unamortized discount and issuance costs — (11,212) $ 2,379 $ 714,759 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Dilutive Loss Per Share | The following table sets forth the computation of basic and diluted loss per share: Year Ended December 31, (in $000s) 2020 2019 2018 Net loss $ (21,277) $ (27,052) $ (15,526) Weighted-average basic and diluted shares outstanding: Shares issued in reverse recapitalization — 21,660,638 21,660,638 Shares outstanding post-recapitalization 49,064,615 49,033,903 — Weighted-average basic and diluted shares outstanding 49,064,615 33,066,165 21,660,638 Basic and diluted net loss per share $ (0.43) $ (0.82) $ (0.72) |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Restricted Stock Unit Award Activity | The following table summarizes the Company’s RSU award activity: Number of Shares Weighted Average Grant Date Fair Value Outstanding RSUs, December 31, 2018 — $ — Granted 656,666 $ 6.98 Forfeited/cancelled/expired — $ — Vested — $ — Outstanding RSUs, December 31, 2019 656,666 $ 6.98 Granted 867,838 $ 2.76 Forfeited/cancelled/expired (219,412) $ 6.37 Vested (127,500) $ 6.98 Outstanding RSUs, December 31, 2020 1,177,592 $ 4.05 |
Summary of Stock Option Award Activity | The following table summarizes the Company’s stock option activity: Number of Options Weighted Average Exercise Price Outstanding stock options, December 31, 2018 — $ — Granted 1,513,334 $ 9.60 Exercised — $ — Forfeited/cancelled/expired — $ — Outstanding stock options, December 31, 2019 1,513,334 $ 9.60 Granted 1,297,076 $ 3.70 Exercised — $ — Forfeited/cancelled/expired (418,494) $ 9.45 Outstanding stock options, December 31, 2020 2,391,916 $ 6.43 |
Summary of Options Outstanding and Exercisable by Exercise Price | The following table presents the options outstanding and options exercisable by exercise price with the weighted-average remaining contractual life for the options outstanding and the weighted-average exercise price at December 31, 2020: Options Outstanding Options Exercisable Exercise Price Options Outstanding at December 31, 2020 Weighted Average Remaining Contractual Life (In Years) Weighted Average Grant Date Fair Value Options Exercisable at December 31, 2020 Weighted Average Grant Date Fair Value $3.02 - $6.98 1,458,583 9.3 $ 1.69 66,666 $ 3.21 $10.00 933,333 8.6 $ 3.13 233,333 $ 3.13 2,391,916 9.1 $ 2.25 299,999 $ 3.15 |
Schedule of Assumptions Used in Black-Scholes Option-Pricing Model | The average fair value of each option award at grant date was estimated using the Black-Scholes option-pricing model with the following assumptions: 2020 2019 Dividend yield 0.00 % 0.00 % Volatility 47.00 % 47.00 % Risk-free rate of return 1.58 % 1.58 % Expected life, in years 7.0 6.0 |
Income Tax (Tables)
Income Tax (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The provision for income tax expense (benefit), including the amount of domestic and foreign loss before taxes, is as follows: Year Ended December 31, (in $000s) 2020 2019 2018 Components of loss before tax: Domestic $ (49,096) $ (30,046) $ (12,454) Foreign (2,255) (2,992) (1,367) Total loss before tax (51,351) (33,038) (13,821) Current tax expense: Federal (1,393) — — Foreign 61 483 514 State 66 392 95 Total current tax expense (1,266) 875 609 Deferred tax expense (benefit): Federal (9,179) 852 852 Foreign — — — State (1,786) 244 244 Total deferred tax expense (10,965) 1,096 1,096 Valuation allowance (17,843) (7,957) — Total tax expense (benefit) $ (30,074) $ (5,986) $ 1,705 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation between the federal statutory income tax rate and our actual effective income tax rate is as follows: Year Ended December 31, (in $000s) 2020 2019 2018 Expected federal income statutory tax rate 21.0% 21.0% 21.0% Tax effect of differences: Foreign operations (0.1)% (1.2)% (3.0)% Share-based payments (0.2)% (0.1)% (1.8)% Effect of state income taxes, net of federal income tax benefit 2.6% 5% (0.8)% Change in valuation allowance 34.7% (8.4)% (27.4)% Other 0.6% 1.8% (0.7)% Effective income tax rate 58.6% 18.1% (12.7)% |
Schedule of Deferred Tax Assets and Liabilities | The components of the deferred tax assets and liabilities are as follows: As of December 31, (in $000s) 2020 2019 Deferred tax assets Accounts receivable $ 1,729 $ 1,486 Inventory 740 1,228 Transaction and debt costs 2,609 1,231 Compensation and benefits 668 459 Net operating loss carryforwards 88,913 76,382 Section 163j interest disallowance 9,084 22,583 Foreign tax credits, accrued expenses, and other 1,977 315 Total deferred tax assets 105,720 103,684 Less: valuation allowance (16,542) (34,385) Total deferred tax assets, net 89,178 69,299 Deferred tax liabilities Rental equipment (50,554) (58,887) Intangible assets (21,672) (22,700) Total deferred tax liabilities (72,226) (81,587) Net deferred tax asset (liability) $ 16,952 $ (12,288) |
Summary of Valuation Allowance | The following presents changes in the valuation allowance: Year Ended December 31, (in $000s) 2020 2019 2018 Valuation allowance - beginning of year $ (34,385) $ (31,610) $ (28,384) Charged to benefit (expense) 17,843 (2,775) (3,226) Valuation allowance - end of year $ (16,542) $ (34,385) $ (31,610) |
Condensed Financial Informati_2
Condensed Financial Information of Nesco Holdings, Inc. (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Parent Company Balance Sheets | Condensed Parent Company Balance Sheets (in $000s, except share data) December 31, 2020 December 31, 2019 Deferred income taxes $ 24,869 $ — Total Assets $ 24,869 $ — Liabilities and Stockholders' Deficit Deferred income taxes $ — $ 5,205 Negative investment in subsidiaries 61,105 12,111 Total long-term liabilities 61,105 17,316 Commitments and contingencies (see Note 3) Stockholders' Deficit Common stock - $0.0001 par value, 250,000,000 shares authorized, 49,156,753 and 49,033,903 issued and outstanding, at December 31, 2020 and 2019, respectively 5 5 Additional paid-in capital 429,748 427,391 Accumulated (deficit) (465,989) (444,712) Accumulated other comprehensive loss — — Total stockholders' deficit (36,236) (17,316) Total Liabilities and Stockholders' Deficit $ 24,869 $ — |
Condensed Parent Company Statements of Operations | Condensed Parent Company Statements of Operations Year Ended December 31, (in $000s, except share and per share data) 2020 2019 2018 Operating Expenses Selling, general, and administrative expenses $ 2,357 $ 816.00 $ — Total operating expenses 2,357 816 — Operating Loss (2,357) (816.00) — Other Expense Equity in net loss of subsidiaries 48,994 32,222 13,821 Other expense — — — Total other expense 48,994 32,222 13,821 Loss Before Income Taxes (51,351) (33,038) (13,821) Income Tax (Benefit) Expense (30,074) (5,986) 1,705 Net Loss $ (21,277) $ (27,052) $ (15,526) |
Condensed Parent Company Statements of Comprehensive Loss | Condensed Parent Company Statements of Comprehensive Loss Year Ended December 31, (in $000s) 2020 2019 2018 Net loss $ (21,277) $ (27,052) $ (15,526) Other comprehensive loss Interest rate collar (net of taxes of $285 in 2019) — 396 (396) Other comprehensive loss — 396 (396) Comprehensive loss $ (21,277) $ (26,656) $ (15,922) |
Condensed Parent Company Statements of Cash Flows | Condensed Parent Company Statements of Cash Flows Year Ended December 31, (in $000s) 2020 2019 2018 Net cash flow from operating activities $ (48,994) $ (179,491) $ (14,430) Investing Activities Changes in investment in subsidiaries 48,994 32,222 14,430 Net cash flow from investing activities 48,994 32,222 14,430 Proceeds from merger and recapitalization — 147,269 — Net cash flow from financing activities — 147,269 — Net Change in Cash — — — Cash at Beginning of Period — — — Cash at End of Period $ — $ — $ — |
Business and Organization - Nar
Business and Organization - Narrative (Details) $ / shares in Units, $ in Thousands | Jul. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2020statelocationshares | Dec. 31, 2019USD ($)shares |
Business Acquisition [Line Items] | |||
Number of network locations | location | 50 | ||
Contributed capital from reverse capitalization | $ | $ 172,268 | ||
Common stock, issued (in shares) | 49,033,903 | 49,156,753 | 49,033,903 |
Common stock, outstanding (in shares) | 49,033,903 | 49,156,753 | 49,033,903 |
Warrants To Purchase Common Stock | |||
Business Acquisition [Line Items] | |||
Number of securities called by issued warrants (in shares) | 20,949,980 | ||
Additional Paid-in Capital | |||
Business Acquisition [Line Items] | |||
Contributed capital from reverse capitalization | $ | $ 172,265 | ||
Capitol Sponsors | Private Placement | |||
Business Acquisition [Line Items] | |||
Shares purchased (in shares) | 1,000,000 | ||
Price per share (in dollars per share) | $ / shares | $ 10 | ||
Nesco Owner | Private Placement | |||
Business Acquisition [Line Items] | |||
Shares purchased (in shares) | 4,500,000 | ||
Price per share (in dollars per share) | $ / shares | $ 10 | ||
Capitol | Nesco Owner | |||
Business Acquisition [Line Items] | |||
Trust account balance | $ | $ 412,300 | ||
Transaction expenses | $ | 17,800 | ||
Payments for equity issuance costs | $ | $ 10,000 | ||
Capitol | Nesco Owner | Common Stock | |||
Business Acquisition [Line Items] | |||
Business acquisition shares received (in shares) | 21,660,638 | ||
Contingent consideration, additional shares (up to) (in shares) | 3,451,798 | ||
Capitol | Nesco Owner | Warrant | |||
Business Acquisition [Line Items] | |||
Business acquisition shares received (in shares) | 2,500,000 | ||
Nesco Owner | |||
Business Acquisition [Line Items] | |||
Transaction expenses | $ | $ 10,200 | ||
Repayments of third party debt | $ | $ 127,800 | ||
Class A Ordinary Shares | Capitol | Nesco Owner | |||
Business Acquisition [Line Items] | |||
Conversion of stock, shares converted (in shares) | 26,091,034 | ||
Common stock, conversion price (in dollars per share) | $ / shares | $ 10.24 | ||
Proceeds from conversion of stock | $ | $ 267,200 | ||
United States | |||
Business Acquisition [Line Items] | |||
Number of states positioned to serve | state | 50 | ||
Canada | |||
Business Acquisition [Line Items] | |||
Number of states positioned to serve | state | 13 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2022 | |
Revenue from External Customer [Line Items] | ||||
Depreciation expense | $ 78,532,000 | $ 70,568,000 | $ 64,093,000 | |
Residual value | 0 | |||
Deferred revenue | 1,000,000 | 2,300,000 | ||
Capital lease obligations | $ 10,500,000 | |||
Minimum | ||||
Revenue from External Customer [Line Items] | ||||
Useful life | 3 years | |||
Maximum | ||||
Revenue from External Customer [Line Items] | ||||
Useful life | 15 years | |||
Forecast | Minimum | ||||
Revenue from External Customer [Line Items] | ||||
ROU assets | $ 6,900,000 | |||
Operating lease liability | 6,900,000 | |||
Forecast | Maximum | ||||
Revenue from External Customer [Line Items] | ||||
ROU assets | 7,900,000 | |||
Operating lease liability | $ 7,900,000 | |||
Parts, tools and accessories inventory | ||||
Revenue from External Customer [Line Items] | ||||
Useful life | 5 years | |||
Rental Equipment | ||||
Revenue from External Customer [Line Items] | ||||
Useful life | 7 years | |||
Estimated residual value, percentage | 15.00% | |||
Assets Leased to Others | ||||
Revenue from External Customer [Line Items] | ||||
Term of operating lease | 28 days | |||
Payment term for lease | 30 days | |||
Non-Rental Property and Equipment | ||||
Revenue from External Customer [Line Items] | ||||
Depreciation expense | $ 800,000 | $ 900,000 | $ 900,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||||
Trade receivables | $ 67,305 | $ 75,977 | ||
Less: allowance for doubtful accounts | (6,372) | (4,654) | $ (7,562) | $ (4,404) |
Accounts receivable, net of allowance | $ 60,933 | $ 71,323 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Allowance - beginning of period | $ 4,654 | $ 7,562 | $ 4,404 |
Accounts written off during period | (1,410) | (6,208) | (1,144) |
Recoveries | (637) | (701) | (177) |
Bad debts expense | 3,765 | 4,001 | 4,479 |
Allowance - end of period | $ 6,372 | $ 4,654 | $ 7,562 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory [Line Items] | ||
Inventory, Net | $ 31,367 | $ 33,001 |
Parts, tools and accessories inventory | ||
Inventory [Line Items] | ||
Inventory, Net | 28,091 | 30,174 |
Equipment inventory | ||
Inventory [Line Items] | ||
Inventory, Net | $ 3,276 | $ 2,827 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||
Accrued interest | $ 20,478 | $ 20,629 |
Accrued salaries, wages and benefits | 3,176 | 4,164 |
Accrued sales taxes | 1,703 | 1,444 |
Other, including transaction expenses | 6,634 | 1,353 |
Accrued liabilities | $ 31,991 | $ 27,590 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue from External Customer [Line Items] | |||
Topic 840 | $ 187,522 | $ 189,161 | $ 177,032 |
Topic 606 | 115,217 | 74,874 | 69,265 |
Total | 302,739 | 264,035 | 246,297 |
Rental revenue | |||
Revenue from External Customer [Line Items] | |||
Topic 840 | 187,522 | 189,161 | 177,032 |
Topic 606 | 7,968 | 8,835 | 7,531 |
Total | 195,490 | 197,996 | 184,563 |
Rental Revenue, Excluding Shipping And Handling | |||
Revenue from External Customer [Line Items] | |||
Topic 840 | 187,522 | 189,161 | 177,032 |
Topic 606 | 0 | 0 | 0 |
Total | 187,522 | 189,161 | 177,032 |
Rental Revenue, Shipping And Handling | |||
Revenue from External Customer [Line Items] | |||
Topic 840 | 0 | 0 | 0 |
Topic 606 | 7,968 | 8,835 | 7,531 |
Total | 7,968 | 8,835 | 7,531 |
Sales and services | |||
Revenue from External Customer [Line Items] | |||
Topic 840 | 0 | 0 | 0 |
Topic 606 | 107,249 | 66,039 | 61,734 |
Total | 107,249 | 66,039 | 61,734 |
Sales of rental equipment | |||
Revenue from External Customer [Line Items] | |||
Topic 840 | 0 | 0 | 0 |
Topic 606 | 31,533 | 23,767 | 26,019 |
Total | 31,533 | 23,767 | 26,019 |
Sales of new equipment | |||
Revenue from External Customer [Line Items] | |||
Topic 840 | 0 | 0 | 0 |
Topic 606 | 25,099 | 10,308 | 18,349 |
Total | 25,099 | 10,308 | 18,349 |
Parts sales and services | |||
Revenue from External Customer [Line Items] | |||
Topic 840 | 0 | 0 | 0 |
Topic 606 | 50,617 | 31,964 | 17,366 |
Total | $ 50,617 | $ 31,964 | $ 17,366 |
Segments - Narrative (Details)
Segments - Narrative (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020USD ($)statesegment | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | segment | 2 | |
Goodwill | $ 238,052 | $ 238,195 |
United States | ||
Segment Reporting Information [Line Items] | ||
Number of states positioned to serve | state | 50 | |
Canada | ||
Segment Reporting Information [Line Items] | ||
Number of states positioned to serve | state | 13 | |
ERS | ||
Segment Reporting Information [Line Items] | ||
Goodwill | $ 229,100 | 229,400 |
PTA | ||
Segment Reporting Information [Line Items] | ||
Goodwill | $ 9,000 | $ 8,800 |
Segments - Financial Informatio
Segments - Financial Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Rental revenue | $ 302,739 | $ 264,035 | $ 246,297 |
Cost of revenue and sales, excluding depreciation | 147,764 | 106,919 | 100,586 |
Depreciation of rental equipment | 78,532 | 70,568 | 64,093 |
Gross profit | 76,443 | 86,548 | 81,618 |
ERS | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 236,565 | 216,795 | 217,635 |
Cost of revenue and sales, excluding depreciation | 103,547 | 76,573 | 84,509 |
Depreciation of rental equipment | 74,376 | 66,228 | 60,436 |
Gross profit | 58,642 | 73,994 | 72,690 |
PTA | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 66,174 | 47,240 | 28,662 |
Cost of revenue and sales, excluding depreciation | 44,217 | 30,346 | 16,077 |
Depreciation of rental equipment | 4,156 | 4,340 | 3,657 |
Gross profit | 17,801 | 12,554 | 8,928 |
Rental revenue | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 195,490 | 197,996 | 184,563 |
Cost of revenue and sales, excluding depreciation | 59,030 | 50,829 | 49,023 |
Rental revenue | ERS | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 179,933 | 182,720 | 173,267 |
Rental revenue | PTA | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 15,557 | 15,276 | 11,296 |
Sales of rental equipment | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 31,533 | 23,767 | 26,019 |
Cost of revenue and sales, excluding depreciation | 25,615 | 20,302 | 21,689 |
Sales of rental equipment | ERS | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 31,533 | 23,767 | 26,019 |
Sales of rental equipment | PTA | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 0 | 0 | 0 |
Sales of new equipment | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 25,099 | 10,308 | 18,349 |
Cost of revenue and sales, excluding depreciation | 21,792 | 8,520 | 16,099 |
Sales of new equipment | ERS | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 25,099 | 10,308 | 18,349 |
Sales of new equipment | PTA | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 0 | 0 | 0 |
Parts sales and services | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 50,617 | 31,964 | 17,366 |
Cost of revenue and sales, excluding depreciation | 39,150 | 25,052 | 12,339 |
Parts sales and services | ERS | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 0 | 0 | 0 |
Parts sales and services | PTA | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | $ 50,617 | $ 31,964 | $ 17,366 |
Segments - Reconciliation of Se
Segments - Reconciliation of Segment Gross Profit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting [Abstract] | |||
Gross profit | $ 76,443 | $ 86,548 | $ 81,618 |
Selling, general, and administrative | 43,464 | 34,667 | 32,718 |
Licensing and titling expenses | 2,945 | 2,617 | 2,241 |
Amortization and non-rental depreciation | 3,248 | 3,122 | 3,045 |
Transaction expenses | 6,627 | 7,641 | 440 |
Asset impairment | 0 | 657 | 0 |
Other operating expenses | 2,911 | 1,826 | 10 |
Other (income) expense | 5,399 | 1,690 | 287 |
Loss on extinguishment of debt | 0 | 4,005 | 0 |
Interest expense, net | 63,200 | 63,361 | 56,698 |
Loss before income taxes | $ (51,351) | $ (33,038) | $ (13,821) |
Segments - Revenue and Assets b
Segments - Revenue and Assets by Country (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Rental revenue | $ 302,739 | $ 264,035 | $ 246,297 |
Assets | 768,404 | 815,284 | |
Loss before income taxes | 51,351 | 33,038 | 13,821 |
Asset impairment | 0 | 657 | 0 |
United States | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 295,125 | 257,297 | 237,815 |
Assets | 762,696 | 802,516 | |
Canada | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 5,827 | 5,705 | 6,297 |
Assets | 5,447 | 8,152 | |
Mexico | |||
Segment Reporting Information [Line Items] | |||
Rental revenue | 1,787 | 1,033 | 2,185 |
Assets | 261 | 4,616 | |
Loss before income taxes | $ 2,100 | 4,300 | $ 1,900 |
Asset impairment | 700 | ||
Statutorily-required minimum benefits charge | $ 200 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) | Nov. 04, 2019USD ($) | Jul. 02, 2018USD ($)owner | Dec. 31, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2020USD ($) |
Business Acquisition [Line Items] | |||||
Goodwill | $ 238,195,000 | $ 238,195,000 | $ 238,052,000 | ||
Truck Utilities, Inc | |||||
Business Acquisition [Line Items] | |||||
Purchase consideration | $ 44,700,000 | ||||
Cash | 3,094,000 | ||||
Capital expenditure adjustment | 3,800,000 | ||||
Revenue | 8,500,000 | ||||
Pretax income | $ 200,000 | ||||
Goodwill | 9,338,000 | ||||
Business acquisition, goodwill expected to be tax deductible | 0 | ||||
Truck Utilities, Inc | ERS | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 5,600,000 | ||||
Truck Utilities, Inc | PTA | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 3,700,000 | ||||
N&L Line Equipment | |||||
Business Acquisition [Line Items] | |||||
Purchase consideration | $ 5,000,000 | ||||
Cash | $ 69,000 | ||||
Revenue | 2,100,000 | ||||
Pretax income | $ 400,000 | ||||
Voting interests acquired | 100.00% | ||||
Cash consideration transferred | $ 1,600,000 | ||||
Goodwill | 1,189,000 | ||||
Business acquisition, goodwill expected to be tax deductible | 0 | ||||
Intangible assets | 2,200,000 | ||||
Unsecured Notes | N&L Line Equipment | |||||
Business Acquisition [Line Items] | |||||
Business combination, liabilities issued | $ 3,500,000 | ||||
Debt interest rate | 5.00% | ||||
Debt instrument term | 5 years | ||||
Number of former owners | owner | 2 |
Business Combinations - Fair Va
Business Combinations - Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Nov. 04, 2019 | Jul. 02, 2018 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 238,052 | $ 238,195 | ||
Truck Utilities, Inc | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 3,094 | |||
Accounts receivable | 3,029 | |||
Inventory | 4,178 | |||
Other current assets | 155 | |||
Property and equipment | 78 | |||
Rental equipment | 38,780 | |||
Total identifiable assets acquired | 52,314 | |||
Accounts payable and other liabilities | (10,132) | |||
Note payable | 0 | |||
Total liabilities assumed | (10,132) | |||
Goodwill | 9,338 | |||
Total consideration | 51,520 | |||
N&L Line Equipment | ||||
Business Acquisition [Line Items] | ||||
Cash | $ 69 | |||
Accounts receivable | 559 | |||
Inventory | 270 | |||
Other current assets | 0 | |||
Property and equipment | 474 | |||
Rental equipment | 1,056 | |||
Intangible assets | 2,200 | |||
Total identifiable assets acquired | 4,658 | |||
Accounts payable and other liabilities | (378) | |||
Note payable | (504) | |||
Total liabilities assumed | (882) | |||
Goodwill | 1,189 | |||
Total consideration | 4,965 | |||
Customer relationships | Truck Utilities, Inc | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | 2,110 | |||
Customer relationships | N&L Line Equipment | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | 1,610 | |||
Trademarks | Truck Utilities, Inc | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | 750 | |||
Trademarks | N&L Line Equipment | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | 530 | |||
Non-competition agreements | Truck Utilities, Inc | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 140 | |||
Non-competition agreements | N&L Line Equipment | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 90 |
Business Combinations - Pro For
Business Combinations - Pro Forma Information (Details) - Truck Utilities, Inc - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | ||
Total revenue | $ 301,450 | $ 291,141 |
Net loss | $ (24,576) | $ (14,875) |
Basic and diluted net loss per share (in usd per share) | $ (0.74) | $ (0.69) |
Rental Equipment and Property_3
Rental Equipment and Property Equipment - Schedule of Rental Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Abstract] | ||
Rental equipment | $ 654,547 | $ 658,564 |
Less: accumulated depreciation | (318,735) | (275,144) |
Rental equipment, net | $ 335,812 | $ 383,420 |
Rental Equipment and Property_4
Rental Equipment and Property Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Less: accumulated depreciation | $ (8,137) | $ (7,168) |
Property and equipment, net | 6,269 | 6,561 |
Property And Equipment (Excluding Construction In Progress) | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 11,816 | 10,082 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 2,590 | $ 3,647 |
Rental Equipment and Property_5
Rental Equipment and Property Equipment - Narrative (Details) - USD ($) $ in Thousands | Sep. 27, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||||
Asset impairment | $ 0 | $ 657 | $ 0 | |
Assets Leased to Others | ||||
Property, Plant and Equipment [Line Items] | ||||
Asset impairment | $ 700 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Impairment losses | $ 0 | $ 0 | $ 0 |
Cumulative impairment loss | 190,700,000 | 9,900,000 | 114,400,000 |
Goodwill period increase (decrease) | (100,000) | 9,500,000 | |
Amortization - intangibles | $ 3,153,000 | $ 3,008,000 | $ 2,826,000 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Schedule of Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | $ 238,052 | $ 238,195 |
Nesco trade name | 28,000 | 28,000 |
Finite-lived intangible assets, accumulated amortization | (14,891) | (11,738) |
Total | 39,579 | |
Intangible assets, gross (excluding goodwill) | 82,470 | 82,290 |
Intangible assets, net (excluding goodwill) | 67,579 | 70,552 |
Goodwill and other intangible assets, gross | 320,522 | 320,485 |
Goodwill and other intangible assets, net | 305,631 | 308,747 |
Trade Names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 1,780 | 1,030 |
Finite-lived intangible assets, accumulated amortization | (284) | (128) |
Total | $ 1,496 | $ 902 |
Amortization Period | 15 years | 15 years |
Non-competition agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | $ 520 | $ 380 |
Finite-lived intangible assets, accumulated amortization | (475) | (245) |
Total | $ 45 | $ 135 |
Amortization Period | 3 years | |
Non-competition agreements | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 1 year | |
Non-competition agreements | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 3 years | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | $ 52,170 | $ 52,880 |
Finite-lived intangible assets, accumulated amortization | (14,132) | (11,365) |
Total | $ 38,038 | $ 41,515 |
Customer relationships | Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 15 years | 15 years |
Customer relationships | Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 20 years | 20 years |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Estimated Amortization Expense (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 | $ 3,015 |
2022 | 3,015 |
2023 | 3,008 |
2024 | 2,997 |
2025 | 2,997 |
Thereafter | 24,547 |
Total | $ 39,579 |
Fair Value Measurements - Carry
Fair Value Measurements - Carrying Values and Fair Values of Financial Liabilities (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative | $ 7,012 | $ 1,709 |
Carrying Value | Notes Payable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 2,379 | 3,525 |
Carrying Value | Senior Secured Notes due 2024 | Senior Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 475,000 | 475,000 |
Carrying Value | Revolving Credit Facility | 2019 Credit Facility | Line of Credit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 250,971 | 250,000 |
Fair Value | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative | 0 | 0 |
Fair Value | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative | 7,012 | 1,709 |
Fair Value | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative | 0 | 0 |
Fair Value | Notes Payable | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 0 | 0 |
Fair Value | Notes Payable | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 2,379 | 3,650 |
Fair Value | Notes Payable | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 0 | 0 |
Fair Value | Senior Secured Notes due 2024 | Senior Notes | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 0 | 0 |
Fair Value | Senior Secured Notes due 2024 | Senior Notes | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 519,379 | 494,000 |
Fair Value | Senior Secured Notes due 2024 | Senior Notes | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 0 | 0 |
Fair Value | Revolving Credit Facility | 2019 Credit Facility | Line of Credit | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 0 | 0 |
Fair Value | Revolving Credit Facility | 2019 Credit Facility | Line of Credit | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | 250,971 | 250,000 |
Fair Value | Revolving Credit Facility | 2019 Credit Facility | Line of Credit | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt | $ 0 | $ 0 |
Financial Instruments - Narrati
Financial Instruments - Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 17, 2019 | |
Derivative [Line Items] | ||||
Reclassification from accumulated other comprehensive loss | $ 0 | $ 800,000 | $ 0 | |
Reclassification from accumulated other comprehensive loss, taxes | 300,000 | |||
Interest Rate Collar | ||||
Derivative [Line Items] | ||||
Derivative instruments not designated as hedges, gain (loss) | $ 5,300,000 | 1,700,000 | ||
Not Designated as Hedging Instrument | Interest Rate Collar | ||||
Derivative [Line Items] | ||||
Interest rate collar amount | $ 170,000,000 | |||
Cash Flow Hedging | Designated as Hedging Instrument | Interest Rate Collar | ||||
Derivative [Line Items] | ||||
Reclassification from accumulated other comprehensive loss | 800,000 | |||
Reclassification from accumulated other comprehensive loss, taxes | $ 300,000 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Long-term Purchase Commitment [Line Items] | |||
Non-cancelable, purchase commitments | $ 0 | ||
Cost Of Rental Revenue Excluding Depreciation | |||
Long-term Purchase Commitment [Line Items] | |||
Rent expense | 1,300,000 | $ 1,900,000 | $ 1,500,000 |
Parts sales and services | |||
Long-term Purchase Commitment [Line Items] | |||
Rent expense | 800,000 | 0 | 0 |
Selling, General and Administrative Expenses | |||
Long-term Purchase Commitment [Line Items] | |||
Rent expense | $ 600,000 | 400,000 | 300,000 |
Property Subject to Operating Lease | |||
Long-term Purchase Commitment [Line Items] | |||
Term of operating lease | 5 years | ||
Property Subject to Operating Lease | Cost Of Rental Revenue Excluding Depreciation | |||
Long-term Purchase Commitment [Line Items] | |||
Rent expense | $ 1,800,000 | $ 2,200,000 | $ 5,000,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 | $ 2,727 |
2022 | 2,097 |
2023 | 1,721 |
2024 | 1,135 |
2025 | 475 |
Thereafter | 1,607 |
Total | $ 9,762 |
Debt - Schedule of Debt Obligat
Debt - Schedule of Debt Obligations (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 31, 2019 |
Debt Instrument [Line Items] | |||
Total debt outstanding | $ 728,350 | $ 728,525 | |
Deferred finance fees | (11,212) | (14,222) | |
Net debt | 717,138 | 714,303 | |
Current maturities of long-term debt | (1,280) | (1,280) | |
Long term debt, net | 715,858 | 713,023 | |
Senior Notes | Senior Secured Notes due 2024 | |||
Debt Instrument [Line Items] | |||
Total debt outstanding | $ 475,000 | $ 475,000 | |
Debt interest rate | 10.00% | 10.00% | 10.00% |
Notes Payable | |||
Debt Instrument [Line Items] | |||
Total debt outstanding | $ 2,379 | $ 3,525 | |
Deferred finance fees | 0 | ||
Net debt | 2,379 | ||
Revolving Credit Facility | Line of Credit | 2019 Credit Facility | |||
Debt Instrument [Line Items] | |||
Total debt outstanding | $ 250,971 | $ 250,000 | |
Debt interest rate | 3.40% | 4.20% |
Debt - Narrative (Details)
Debt - Narrative (Details) | Jul. 31, 2019USD ($)day | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2018USD ($) | Mar. 10, 2020USD ($) |
Debt Instrument [Line Items] | ||||||
Loss on extinguishment of debt | $ 0 | $ 4,005,000 | $ 0 | |||
Outstanding letters of credit | 1,400,000 | |||||
Long-term debt | $ 717,138,000 | 714,303,000 | ||||
Capital lease term | 5 years | |||||
Rental equipment carrying value | $ 13,300,000 | 27,300,000 | ||||
Capital lease depreciation | 8,700,000 | $ 15,200,000 | ||||
Line of Credit | 2019 Credit Facility | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing capacity | $ 350,000,000 | $ 385,000,000 | ||||
Debt instrument term | 5 years | |||||
Increase in maximum borrowing capacity | $ 35,000,000 | |||||
Costs incurred for closing credit facility | $ 4,800,000 | |||||
Remaining borrowing amount | $ 90,200,000 | |||||
Debt basis spread | 1.00% | |||||
Commitment fee percentage | 0.375% | |||||
Foreign subsidiaries, percentage of voting capital stock limit | 65.00% | |||||
Fixed charge coverage | 1 | |||||
Credit facility line cap | 10.00% | |||||
Availability threshold amount | $ 30,000,000 | |||||
Consecutive calendar days | day | 20 | |||||
Debt interest rate | 3.40% | 4.20% | ||||
Line of Credit | 2019 Credit Facility | Revolving Credit Facility | Federal Funds Effective Rate | ||||||
Debt Instrument [Line Items] | ||||||
Debt basis spread | 0.50% | |||||
Line of Credit | 2019 Credit Facility | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Debt basis spread | 1.00% | |||||
Debt basis spread, floor | 0.00% | |||||
Line of Credit | 2019 Credit Facility | Bridge Loan | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 0 | |||||
Senior Notes | The Senior Secured Notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt outstanding | $ 475,000,000 | |||||
Debt interest rate | 10.00% | 10.00% | 10.00% | |||
Senior Notes | The Senior Secured Notes | Prior to August 1, 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Debt redemption price percentage | 100.00% | |||||
Senior Notes | The Senior Secured Notes | August 1, 2021 to July 31, 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Debt redemption price percentage | 105.00% | |||||
Senior Notes | The Senior Secured Notes | August 1, 2022 to July 31, 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Debt redemption price percentage | 102.50% | |||||
Senior Notes | The Senior Secured Notes | After August 1, 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Debt redemption price percentage | 100.00% | |||||
Senior Notes | The Senior Secured Notes | Until August 1, 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Debt redemption price percentage | 110.00% | |||||
Percent of notes redeemable | 40.00% | |||||
Notes Payable | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt | $ 2,379,000 | |||||
Notes Payable | Bethea | ||||||
Debt Instrument [Line Items] | ||||||
Debt interest rate | 5.00% | |||||
Quarterly installment payment | $ 200,000 | |||||
Annual payment | $ 500,000 |
Debt - Schedule of Capital Leas
Debt - Schedule of Capital Leases (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 5,885 |
2022 | 4,175 |
2023 | 1,617 |
Total | 11,677 |
Less amounts representing interest | (1,151) |
Future minimum payments, net | $ 10,526 |
Debt - Schedule of Debt Payment
Debt - Schedule of Debt Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Total | $ 728,350 | $ 728,525 |
Less unamortized discount and issuance costs | (11,212) | (14,222) |
Net debt | 717,138 | 714,303 |
Notes Payable | ||
Debt Instrument [Line Items] | ||
2021 | 1,280 | |
2022 | 550 | |
2023 | 549 | |
2024 | 0 | |
Total | 2,379 | $ 3,525 |
Less unamortized discount and issuance costs | 0 | |
Net debt | 2,379 | |
Senior Secured Notes and 2019 Credit Facility | ||
Debt Instrument [Line Items] | ||
2021 | 0 | |
2022 | 0 | |
2023 | 0 | |
2024 | 725,971 | |
Total | 725,971 | |
Less unamortized discount and issuance costs | (11,212) | |
Net debt | $ 714,759 |
Equity - Narrative (Details)
Equity - Narrative (Details) | Jul. 31, 2019day$ / sharesshares | Jul. 30, 2019shares | Dec. 31, 2020$ / sharesshares | Dec. 31, 2019$ / sharesshares |
Business Acquisition [Line Items] | ||||
Preferred stock authorized (in shares) | shares | 5,000,000 | |||
Preferred stock par value (in dollars per share) | $ 0.0001 | |||
Preferred stock issued (in shares) | shares | 0 | 0 | ||
Preferred stock outstanding (in shares) | shares | 0 | 0 | ||
Common stock, authorized (in shares) | shares | 250,000,000 | 250,000,000 | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Share price of warrants (in dollars per share) | $ 11.50 | |||
Outstanding Warrants Except Non-Public Warrants | ||||
Business Acquisition [Line Items] | ||||
Share price of warrants (in dollars per share) | $ 0.01 | |||
NESCO Holdings, LP and NESCO Management | Non-Public Warrant | ||||
Business Acquisition [Line Items] | ||||
Number of securities called by issued warrants (in shares) | shares | 2,500,000 | |||
Warrant fair value price (in dollars per share) | $ 1.04 | |||
NESCO Holdings, LP and NESCO Management | Outstanding Warrants Except Non-Public Warrants | ||||
Business Acquisition [Line Items] | ||||
Redemption days notice | 30 days | |||
Warrant stock price trigger (in dollars per share) | $ 18 | |||
Warrant trading days | day | 20 | |||
Warrant consecutive trading days | day | 30 | |||
Private Placement | Capitol Sponsors | ||||
Business Acquisition [Line Items] | ||||
Shares purchased (in shares) | shares | 1,000,000 | |||
Price per share (in dollars per share) | $ 10 | |||
Private Placement | Nesco Owner | ||||
Business Acquisition [Line Items] | ||||
Shares purchased (in shares) | shares | 4,500,000 | |||
Price per share (in dollars per share) | $ 10 | |||
Capitol | ||||
Business Acquisition [Line Items] | ||||
Common stock under sale restrictions (in shares) | shares | 3,148,202 | |||
Capitol | Nesco Owner | Additional shares if common stock exceeds $13 per share or $16 per share | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration term (in years) | 5 years | |||
Capitol | Nesco Owner | Additional shares if common stock exceeds $13 per share | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration stock price trigger (in dollars per share) | $ 13 | |||
Capitol | Nesco Owner | Additional shares if common stock exceeds $16 per share | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration stock price trigger (in dollars per share) | $ 16 | |||
Capitol | Nesco Owner | Additional shares if common stock exceeds $19 per share | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration, additional shares (up to) (in shares) | shares | 1,651,798 | |||
Contingent consideration term (in years) | 7 years | |||
Contingent consideration stock price trigger (in dollars per share) | $ 19 | |||
Trading days threshold | day | 20 | |||
Consecutive trading days threshold | day | 30 | |||
Share price consideration (in dollars per share) | $ 19 | |||
Capitol | Nesco Owner | Common Stock | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration, additional shares (up to) (in shares) | shares | 3,451,798 | |||
Capitol | Nesco Owner | Common Stock | Additional shares if common stock exceeds $13 per share or $16 per share | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration, additional shares (up to) (in shares) | shares | 1,800,000 | |||
Contingent consideration, incremental shares transferred (in shares) | shares | 900,000 | |||
Consecutive trading days threshold | day | 30 | |||
Capitol | Nesco Owner | Common Stock | Additional shares if common stock exceeds $13 per share | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration stock price trigger (in dollars per share) | $ 13 | |||
Capitol | Nesco Owner | Common Stock | Additional shares if common stock exceeds $16 per share | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration stock price trigger (in dollars per share) | $ 16 | |||
Trading days threshold | day | 20 | |||
Capitol | Sponsor Warrants | ||||
Business Acquisition [Line Items] | ||||
Class of warrant, outstanding (in shares) | shares | 20,949,980 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Dilutive Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Jul. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |||||
Potentially dilutive shares excluded in aggregate (in shares) | 27,700,000 | 26,600,000 | |||
Net income (loss) | $ (16,064) | $ (10,988) | $ (21,277) | $ (27,052) | $ (15,526) |
Weighted-average basic and diluted shares outstanding: | |||||
Shares issued in reverse capitalization (in shares) | 0 | 21,660,638 | 21,660,638 | ||
Shares outstanding post-recapitalization (in shares) | 49,064,615 | 49,033,903 | 0 | ||
Weighted-average basic and diluted shares outstanding (in shares) | 49,064,615 | 33,066,165 | 21,660,638 | ||
Basic and diluted net loss per share (USD per share) | $ (0.43) | $ (0.82) | $ (0.72) |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 11, 2020 | Jun. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares of common stock authorized for issuance (in shares) | 6,150,000 | 3,150,000 | |||
Shares of common stock reserved for issuance (in shares) | 2,452,992 | ||||
Share-based compensation expense | $ 0.2 | $ 1.1 | |||
Unrecognized compensation expense related to options | 3.8 | ||||
Intrinsic value of options outstanding and exercisable | $ 0.1 | ||||
Options exercised (in shares) | 0 | 0 | 0 | ||
Restricted Stock Units (RSUs) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation expense | $ 1.2 | $ 0.4 | |||
Vesting period | 3 years | ||||
Non option related unrecognized compensation expense | $ 4.1 | ||||
Period for recognition | 3 years 1 month 6 days | ||||
Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation expense | $ 1.2 | $ 0.4 | |||
Vesting period | 3 years | ||||
Period for recognition | 2 years 10 months 24 days |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Restricted Stock (Details) - Restricted Stock Units (RSUs) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Outstanding RSUs, beginning balance (in shares) | 656,666 | 0 |
Granted (in shares) | 867,838 | 656,666 |
Forfeited/cancelled/expired (in shares) | (219,412) | 0 |
Vested (in shares) | (127,500) | 0 |
Outstanding RSUs, ending balance | 1,177,592 | 656,666 |
Weighted Average Grant Date Fair Value | ||
Outstanding, beginning balance (in dollars per share) | $ 6.98 | $ 0 |
Granted (in dollars per share) | 2.76 | 6.98 |
Forfeited/cancelled/expired (in dollars per share) | 6.37 | 0 |
Vested (in dollars per share) | 6.98 | 0 |
Outstanding, ending balance (in dollars per share) | $ 4.05 | $ 6.98 |
Share-Based Compensation - Su_2
Share-Based Compensation - Summary of Stock Options (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Number of Options | |||
Options outstanding, beginning balance (in shares) | 1,513,334 | 0 | |
Options granted (in shares) | 1,297,076 | 1,513,334 | |
Options exercised (in shares) | 0 | 0 | 0 |
Options forfeited/cancelled/expired (in shares) | (418,494) | 0 | |
Options outstanding, ending balance (in shares) | 2,391,916 | 1,513,334 | 0 |
Weighted Average Exercise Price | |||
Options outstanding, beginning balance (in dollars per share) | $ 9.60 | $ 0 | |
Options granted (in dollars per share) | 3.70 | 9.60 | |
Options exercised (in dollars per share) | 0 | 0 | |
Options forfeited/cancelled/expired (in dollars per share) | 9.45 | 0 | |
Options outstanding, ending balance (in dollars per share) | $ 6.43 | $ 9.60 | $ 0 |
Share-Based Compensation - Su_3
Share-Based Compensation - Summary of Options Outstanding and Exercisable by Exercise Price (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Options outstanding (in shares) | 2,391,916 | 1,513,334 | 0 |
Options outstanding, weighted average remaining contractual life | 9 years 1 month 6 days | ||
Options outstanding, weighted average grant date fair value (in dollars per share) | $ 2.25 | ||
Options Exercisable at December 31, 2020 | 299,999 | ||
Options exercisable, weighted average grant date fair value (in dollars per share) | $ 3.15 | ||
$3.02 - $6.98 | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Lower price range exercise price (in dollars per share) | 3.02 | ||
Upper price range exercise price (in dollars per share) | $ 6.98 | ||
Options outstanding (in shares) | 1,458,583 | ||
Options outstanding, weighted average remaining contractual life | 9 years 3 months 18 days | ||
Options outstanding, weighted average grant date fair value (in dollars per share) | $ 1.69 | ||
Options Exercisable at December 31, 2020 | 66,666 | ||
Options exercisable, weighted average grant date fair value (in dollars per share) | $ 3.21 | ||
$10.00 | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Lower price range exercise price (in dollars per share) | 10 | ||
Upper price range exercise price (in dollars per share) | $ 10 | ||
Options outstanding (in shares) | 933,333 | ||
Options outstanding, weighted average remaining contractual life | 8 years 7 months 6 days | ||
Options outstanding, weighted average grant date fair value (in dollars per share) | $ 3.13 | ||
Options Exercisable at December 31, 2020 | 233,333 | ||
Options exercisable, weighted average grant date fair value (in dollars per share) | $ 3.13 |
Share-Based Compensation - Blac
Share-Based Compensation - Black-Scholes Assumptions (Details) - Stock Option | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Dividend yield | 0.00% | 0.00% |
Volatility | 47.00% | 47.00% |
Risk-free rate of return | 1.58% | 1.58% |
Expected life, in years | 7 years | 6 years |
Income Tax - Narrative (Details
Income Tax - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2019 | |
Income Tax Examination [Line Items] | |||
Tax Cuts and Jobs Act, change in tax rate, income tax expense (benefit) | $ 5.2 | ||
Tax cuts and jobs act, measurement period adjustment, income tax benefit | $ 5 | ||
Income tax benefit adjustment, CARES Act | 8.7 | ||
Income tax benefit, net operating loss carry forward, CARES Act | 11.8 | ||
Domestic Tax Authority | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | 363 | $ 285.3 | |
State and Local Jurisdiction | |||
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | $ 223.2 | $ 202.4 |
Income Tax - Components of Inco
Income Tax - Components of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Components of loss before tax: | |||
Domestic | $ (49,096) | $ (30,046) | $ (12,454) |
Foreign | (2,255) | (2,992) | (1,367) |
Total loss before tax | (51,351) | (33,038) | (13,821) |
Current tax expense: | |||
Federal | (1,393) | 0 | 0 |
Foreign | 61 | 483 | 514 |
State | 66 | 392 | 95 |
Total current tax expense | (1,266) | 875 | 609 |
Deferred Federal, State and Local, Tax Expense (Benefit) [Abstract] | |||
Federal | (9,179) | 852 | 852 |
Foreign | 0 | 0 | 0 |
State | (1,786) | 244 | 244 |
Total deferred tax expense | (10,965) | 1,096 | 1,096 |
Valuation allowance | (17,843) | (7,957) | 0 |
Total tax expense (benefit) | $ (30,074) | $ (5,986) | $ 1,705 |
Income Tax - Effective Income T
Income Tax - Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Expected federal income statutory tax rate | 21.00% | 21.00% | 21.00% |
Foreign operations | (0.10%) | (1.20%) | (3.00%) |
Share-based payments | (0.20%) | (0.10%) | (1.80%) |
Effect of state income taxes, net of federal income tax benefit | 2.60% | 5.00% | (0.80%) |
Change in valuation allowance | 34.70% | (8.40%) | (27.40%) |
Other | 0.60% | 1.80% | (0.70%) |
Effective income tax rate | 58.60% | 18.10% | (12.70%) |
Income Tax - Components of Defe
Income Tax - Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Tax Assets, Net [Abstract] | ||
Accounts receivable | $ 1,729 | $ 1,486 |
Inventory | 740 | 1,228 |
Transaction and debt costs | 2,609 | 1,231 |
Compensation and benefits | 668 | 459 |
Net operating loss carryforwards | 88,913 | 76,382 |
Section 163j interest disallowance | 9,084 | 22,583 |
Foreign tax credits, accrued expenses, and other | 1,977 | 315 |
Total deferred tax assets | 105,720 | 103,684 |
Less: valuation allowance | (16,542) | (34,385) |
Total deferred tax assets, net | 89,178 | 69,299 |
Deferred tax liabilities | ||
Rental equipment | (50,554) | (58,887) |
Intangible assets | (21,672) | (22,700) |
Total deferred tax liabilities | (72,226) | (81,587) |
Net deferred tax asset (liability) | $ 16,952 | |
Net deferred tax asset (liability) | $ (12,288) |
Income Tax - Valuation Allowanc
Income Tax - Valuation Allowance Rollforward (Details) - Valuation allowance - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Valuation allowance - beginning of year | $ (34,385) | $ (31,610) | $ (28,384) |
Charged to benefit (expense) | 17,843 | (2,775) | (3,226) |
Valuation allowance - end of year | $ (16,542) | $ (34,385) | $ (31,610) |
Concentration Risks - Narrative
Concentration Risks - Narrative (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue Benchmark | Customer Concentration Risk | Three customers | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 11.10% | |
Revenue Benchmark | Customer Concentration Risk | One customer | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 10.60% | |
Revenue Benchmark | Geographic Concentration Risk | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 16.40% | 20.00% |
Accounts Receivable | Customer Concentration Risk | Four customers | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 12.10% | |
Purchase Benchmark | Supplier Concentration Risk | Three Vendors | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 10.00% |
Related Parties - Narrative (De
Related Parties - Narrative (Details) - Subsidiary of PLH Group, Inc - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | |||
Total revenue | $ 9.2 | $ 11.5 | $ 9.9 |
Accounts receivable | $ 3.5 | $ 10.2 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 26, 2021 | Dec. 03, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Feb. 18, 2021 |
Subsequent Event [Line Items] | ||||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | ||||
Common stock, authorized (in shares) | 250,000,000 | 250,000,000 | ||||
Preferred stock par value (in dollars per share) | $ 0.0001 | |||||
Preferred stock authorized (in shares) | 5,000,000 | |||||
Proceeds from issuance of long-term debt | $ 0 | $ 475,000 | $ 0 | |||
Forecast | Private Placement | ||||||
Subsequent Event [Line Items] | ||||||
Consideration received on sale of stock | $ 140,000 | |||||
Price per share (in dollars per share) | $ 5 | |||||
Shares purchased (in shares) | 28,000,000 | |||||
Debt Commitment Letter | Line of Credit | Revolving Credit Facility | Forecast | ||||||
Subsequent Event [Line Items] | ||||||
Line of credit, maximum borrowing capacity | $ 750,000 | |||||
Line of credit, amount available on closing date | 400,000 | |||||
Debt Commitment Letter | Senior Notes | Forecast | ||||||
Subsequent Event [Line Items] | ||||||
Proceeds from issuance of long-term debt | 1,000,000 | |||||
Gross cash proceeds threshold for additional funding | 1,000,000 | |||||
Additional funding contingent on proceeds | 1,000,000 | |||||
Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||||
Common stock, authorized (in shares) | 500,000,000 | |||||
Preferred stock par value (in dollars per share) | $ 0.0001 | |||||
Preferred stock authorized (in shares) | 10,000,000 | |||||
Custom Truck | ||||||
Subsequent Event [Line Items] | ||||||
Purchase consideration | $ 1,475,000 | |||||
Business acquisition shares received (in shares) | 20,000,000 | |||||
Custom Truck LP | ||||||
Subsequent Event [Line Items] | ||||||
Voting interests acquired | 100.00% | |||||
Custom Truck LLC | ||||||
Subsequent Event [Line Items] | ||||||
Voting interests acquired | 100.00% | |||||
PE One Source | Forecast | ||||||
Subsequent Event [Line Items] | ||||||
Additional consideration received on sale of stock | 100,000 | |||||
PE One Source | Forecast | Minimum | ||||||
Subsequent Event [Line Items] | ||||||
Consideration received on sale of stock | 700,000 | |||||
PE One Source | Forecast | Maximum | ||||||
Subsequent Event [Line Items] | ||||||
Consideration received on sale of stock | $ 763,000 |
Condensed Financial Informati_3
Condensed Financial Information of Nesco Holdings, Inc. - Condensed Parent Company Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Condensed Financial Statements, Captions [Line Items] | ||||
Deferred income taxes | $ 16,952 | $ 0 | ||
Assets | 768,404 | 815,284 | ||
Deferred income taxes | 0 | 12,288 | ||
Total long-term liabilities | 728,120 | 749,651 | ||
Commitments and contingencies (see Note 3) | ||||
Common stock - $0.0001 par value, 250,000,000 shares authorized, 49,156,753 and 49,033,903 issued and outstanding, at December 31, 2020 and 2019, respectively | 5 | 5 | ||
Additional paid-in capital | 434,917 | 432,577 | ||
Accumulated deficit | (465,989) | (444,712) | ||
Total stockholders' deficit | (31,067) | (12,130) | $ (158,756) | $ (143,964) |
Total Liabilities and Stockholders' Deficit | 768,404 | 815,284 | ||
Parent Company | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Deferred income taxes | 24,869 | 0 | ||
Assets | 24,869 | 0 | ||
Deferred income taxes | 0 | 5,205 | ||
Negative investment in subsidiaries | 61,105 | 12,111 | ||
Total long-term liabilities | 61,105 | 17,316 | ||
Commitments and contingencies (see Note 3) | ||||
Common stock - $0.0001 par value, 250,000,000 shares authorized, 49,156,753 and 49,033,903 issued and outstanding, at December 31, 2020 and 2019, respectively | 5 | 5 | ||
Additional paid-in capital | 429,748 | 427,391 | ||
Accumulated deficit | (465,989) | (444,712) | ||
Accumulated other comprehensive loss | 0 | 0 | ||
Total stockholders' deficit | (36,236) | (17,316) | ||
Total Liabilities and Stockholders' Deficit | $ 24,869 | $ 0 |
Condensed Financial Informati_4
Condensed Financial Information of Nesco Holdings, Inc. - Condensed Parent Company Balance Sheets Additional Information (Details) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 31, 2019 |
Condensed Financial Statements, Captions [Line Items] | |||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |
Common stock, authorized (in shares) | 250,000,000 | 250,000,000 | |
Common stock, issued (in shares) | 49,156,753 | 49,033,903 | 49,033,903 |
Common stock, outstanding (in shares) | 49,156,753 | 49,033,903 | 49,033,903 |
Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | |
Common stock, authorized (in shares) | 250,000,000 | 250,000,000 | |
Common stock, issued (in shares) | 49,156,753 | 49,033,903 | |
Common stock, outstanding (in shares) | 49,156,753 | 49,033,903 |
Condensed Financial Informati_5
Condensed Financial Information of Nesco Holdings, Inc. - Condensed Parent Company Statements of Operations (Details) - USD ($) $ in Thousands | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Jul. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Condensed Financial Statements, Captions [Line Items] | |||||
Selling, general, and administrative | $ 43,464 | $ 34,667 | $ 32,718 | ||
Total operating expenses | 59,195 | 50,530 | 38,454 | ||
Operating income | 17,248 | 36,018 | 43,164 | ||
Other expense, net | 5,399 | 1,690 | 287 | ||
Total other expense | 68,599 | 69,056 | 56,985 | ||
Loss before income taxes | (51,351) | (33,038) | (13,821) | ||
Income tax expense (benefit) | (30,074) | (5,986) | 1,705 | ||
Net Loss | $ (16,064) | $ (10,988) | (21,277) | (27,052) | (15,526) |
Parent Company | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Selling, general, and administrative | 2,357 | 816 | 0 | ||
Total operating expenses | 2,357 | 816 | 0 | ||
Operating income | (2,357) | (816) | 0 | ||
Equity in net loss of subsidiaries | 48,994 | 32,222 | 13,821 | ||
Other expense, net | 0 | 0 | 0 | ||
Total other expense | 48,994 | 32,222 | 13,821 | ||
Loss before income taxes | (51,351) | (33,038) | (13,821) | ||
Income tax expense (benefit) | (30,074) | (5,986) | 1,705 | ||
Net Loss | $ (21,277) | $ (27,052) | $ (15,526) |
Condensed Financial Informati_6
Condensed Financial Information of Nesco Holdings, Inc. - Condensed Parent Company Statements of Comprehensive Loss (Details) - USD ($) $ in Thousands | 5 Months Ended | 7 Months Ended | 12 Months Ended | ||
Dec. 31, 2019 | Jul. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Condensed Financial Statements, Captions [Line Items] | |||||
Net loss | $ (16,064) | $ (10,988) | $ (21,277) | $ (27,052) | $ (15,526) |
Interest rate collar (net of taxes of $285 in 2019) | 0 | 396 | (396) | ||
Other comprehensive loss | 0 | 396 | (396) | ||
Comprehensive loss | (21,277) | (26,656) | (15,922) | ||
Parent Company | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Net loss | (21,277) | (27,052) | (15,526) | ||
Interest rate collar (net of taxes of $285 in 2019) | 0 | 396 | (396) | ||
Other comprehensive loss | 0 | 396 | (396) | ||
Comprehensive loss | $ (21,277) | $ (26,656) | $ (15,922) |
Condensed Financial Informati_7
Condensed Financial Information of Nesco Holdings, Inc. - Condensed Parent Company Statements of Comprehensive Loss Additional Information (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Condensed Financial Statements, Captions [Line Items] | |
Interest rate collar, taxes | $ 285 |
Parent Company | |
Condensed Financial Statements, Captions [Line Items] | |
Interest rate collar, taxes | $ 285 |
Condensed Financial Informati_8
Condensed Financial Information of Nesco Holdings, Inc. - Condensed Parent Company Statements of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Condensed Financial Statements, Captions [Line Items] | |||
Net cash flow from operating activities | $ 42,829 | $ 18,792 | $ 41,040 |
Net cash flow from investing activities | (29,314) | (129,679) | (27,438) |
Proceeds from merger and recapitalization | 0 | 147,269 | 0 |
Net cash flow from financing activities | (16,405) | 115,049 | (12,422) |
Net Change in Cash | (2,890) | 4,162 | 1,180 |
Cash at Beginning of Period | 6,302 | 2,140 | 960 |
Cash at End of Period | 3,412 | 6,302 | 2,140 |
Parent Company | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net cash flow from operating activities | (48,994) | (179,491) | (14,430) |
Changes in investment in subsidiaries | 48,994 | 32,222 | 14,430 |
Net cash flow from investing activities | 48,994 | 32,222 | 14,430 |
Proceeds from merger and recapitalization | 0 | 147,269 | 0 |
Net cash flow from financing activities | 0 | 147,269 | 0 |
Net Change in Cash | 0 | 0 | 0 |
Cash at Beginning of Period | 0 | 0 | 0 |
Cash at End of Period | $ 0 | $ 0 | $ 0 |