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Note 1: ACCOUNTING POlicies and basis of presentation
The condensed consolidated financial statements include all the accounts of Jack Cooper Holdings Corp. and its subsidiaries (“we,” the “Company” or “JCHC”). All significant intercompany balances and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements should be read in conjunction with our consolidated financial statements, and the notes thereto, included in our Annual Report on Form 10-K for the year ended December 31, 2016. In the opinion of management, the unaudited condensed consolidated financial statements reflect all normal, recurring adjustments considered necessary for a fair presentation of the financial position, results of operations and cash flows for the periods presented. Results of operations for interim periods are not necessarily indicative of results to be expected for a full year.
Organization and Business Overview
The Company is a specialty transportation and other logistics provider and the largest over-the-road finished vehicle logistics company in North America. The Company provides premium asset-heavy and asset-light based solutions to the global new and previously owned vehicle markets, specializing in finished vehicle transportation and other logistics services for major automotive original equipment manufacturers, fleet ownership companies, remarketers, dealers and auctions. The Company offers a broad, complementary suite of asset-heavy and asset-light transportation and logistics solutions, operating through a fleet of 1,995 active rigs and a network of 51 strategically located terminals across North America as of March 31, 2017. The Company believes its scale and full range of over-the-road transportation and value-added logistics services, offered in over 80 locations across the U.S., Canada and Mexico, allow it to operate efficiently and deliver superior customer service.
Revenue
The Company primarily earns revenues under multi-year or single-year contracts from the intrastate and interstate transportation of vehicles. Approximately 47%, 34%, and 7% of the Company’s revenues were from its three largest customers, General Motors Company (“GM”), Ford Motor Company (“Ford”), and Toyota Motor Sales, USA, Inc. (“Toyota”), respectively, for the three months ended March 31, 2017, and 45%, 34%, and 13%, respectively, for the three months ended March 31, 2016. These customers also collectively represented approximately 66% of accounts receivable at March 31, 2017 and 64% at December 31, 2016. The allowance for doubtful accounts totaled $1.0 million and $1.3 million as of March 31, 2017 and December 31, 2016, respectively.
Foreign Currency
The Company’s financial condition and results of operations are recorded in multiple currencies, including the Canadian dollar and the Mexican peso, and the Company has an accounts receivable balance denominated in Nigerian naira. Assets and liabilities of subsidiaries whose functional currency is not the U.S. dollar were translated at the exchange rate in effect at the balance sheet date, and revenues and expenses were translated at average exchange rates for the period. Translation adjustments are included in other comprehensive income (loss). Gains and losses on certain of the Company's intercompany loans are included in other, net in the condensed consolidated statements of comprehensive loss due to the intercompany loans not being considered long-term investment in nature.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions about future events relating to the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of expenses during the reporting periods. Significant items subject to such estimates and assumptions include those related to workers’ compensation insurance, pension withdrawal liabilities, allowance for doubtful accounts, the recoverability and useful lives of assets, litigation provisions and income taxes. Estimates are revised when facts and circumstances change. As such, actual results could differ materially from those estimates.
Recently Adopted Accounting Standards
In November 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-18 which clarifies the presentation requirements of restricted cash within the statement of cash flows. The changes in restricted cash and restricted cash equivalents during the period should be included in the beginning and ending cash and cash equivalents balance reconciliation on the statement of cash flows. When cash, cash equivalents, restricted cash or restricted cash equivalents are presented in more than one line item within the statement of financial position, an entity shall calculate a total cash amount in a narrative or tabular format that agrees to the amount shown on the statement of cash flows. Details on the nature and amounts of restricted cash should also be disclosed. This standard is effective for fiscal years beginning after December 15, 2017, including interim periods within that reporting period. As permitted in the standard, this new guidance was early adopted by the Company in the first quarter of 2017. As a result of adopting this standard on January 1, 2017, restricted cash of $0.1 million as of March 31, 2017 and 2016, and restricted cash activity are disclosed separately within the cash flow statement. Restricted cash as of March 31, 2017 and 2016 represented certificates of deposits related to merchant services provided by the Company.
In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which provides for simplification of certain aspects of employee share-based payment accounting including income taxes, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The standard was adopted by the Company January 1, 2017 and was applied prospectively. Excess tax benefits or deficiencies resulting from the exercise or vesting of awards are included in income tax expense in the reporting period in which they occur. No prior or current period financial or cash flow statements were impacted as a result of this change in accounting policy.
|
|||
Note 2: Property and equipment
Property and equipment, net were as follows for the periods presented below:
|
|
|
March 31, |
|
December 31, |
|
||
|
(in thousands) |
|
2017 |
|
2016 |
|
||
|
Land |
|
$ |
7,045 |
|
$ |
7,045 |
|
|
Carrier revenue equipment |
|
|
275,516 |
|
|
272,846 |
|
|
Buildings and equipment |
|
|
39,732 |
|
|
39,007 |
|
|
Leasehold improvements |
|
|
2,778 |
|
|
2,710 |
|
|
Construction in process |
|
|
3,336 |
|
|
4,168 |
|
|
|
|
|
328,407 |
|
|
325,776 |
|
|
Less: accumulated depreciation |
|
|
222,059 |
|
|
214,749 |
|
|
Property and equipment, net |
|
$ |
106,348 |
|
$ |
111,027 |
|
The Company performs periodic reviews of the appropriateness of depreciable lives for each category of property and equipment, taking into consideration actual usage, physical wear and tear, and replacement history to determine the remaining life of the asset base. No changes to the remaining useful life of the asset base were made during the three months ended March 31, 2017.
The Company identified certain assets that meet the criteria for assets held for sale classification. The Company had approximately $0.1 million in assets held for sale as of March 31, 2017 and December 31, 2016, on its condensed consolidated balance sheets. These assets primarily consist of tractors and trailers that do not fit the Company’s fleet needs. The Company plans to sell substantially all of the remaining assets during 2017 and, as such, the assets were measured at fair value less cost to sell.
|
|||
Note 3: LINE OF CREDIT
The Company is party to an Amended and Restated Credit Agreement with the lenders party thereto and Wells Fargo Capital Finance, LLC, as agent, dated June 18, 2013 (as amended, modified and supplemented, the “Credit Facility”), which provides a revolving line of credit of $100 million, with the amount available to borrow determined by a borrowing base calculation based on accounts receivable and vehicles owned less letters of credit and other offsets. The Credit Facility matures at the earlier of (i) June 18, 2018 or (ii) the date that is 90 days prior to the then extant maturity date of the Term Loan (as defined in Note 4, which is currently October 18, 2018). As of March 31, 2017 and December 31, 2016, there were $69.8 million and $71.0 million, respectively, in outstanding borrowings under the Credit Facility with a weighted average interest rate of 4.01% and 3.81%, respectively. As of March 31, 2017 and December 31, 2016, the Company had available borrowing capacity of $14.5 million and $12.5 million, respectively, without consideration of the maximum revolver threshold disclosed below. Borrowings under the Credit Facility are reflected within current liabilities on the condensed consolidated balance sheets. Debt issuance costs associated with the Credit Facility of $0.5 million as of March 31, 2017, and $0.6 million as of December 31, 2016 are included within deposits and other assets on the condensed consolidated balance sheets.
All borrowings under the Credit Facility bear interest at the Base Rate plus the Base Rate Margin, or at the Company’s option, at the LIBOR Rate plus the LIBOR Rate Margin (in minimum amounts of $1 million, each such term as defined under the Credit Agreement).
The Credit Facility contains customary representations, warranties and covenants including, but not limited to, certain limitations on the Company’s and its subsidiaries’ ability to incur additional debt, guarantee other obligations, create or incur liens on assets, make investments or acquisitions, make certain dispositions of assets, make optional payments or modifications of certain debt instruments, pay dividends or other payments to our equity holders, engage in mergers or consolidations, sell assets, change our line of business and engage in transactions with affiliates. If availability under the Credit Facility falls below 12.50% of the Maximum Revolver Amount, the Company will be required to maintain a fixed charge coverage maintenance ratio of at least 1.10:1.00 for a specified time. If excess availability under the Credit Facility falls below 12.50% of the Maximum Revolver Amount, the lender may automatically sweep funds from the Company’s cash accounts to pay down the revolver. At March 31, 2017 and December 31, 2016, the Company’s availability under the Credit Facility exceeded the specified threshold amounts and accordingly, the Company was not in a financial covenant period.
During the three months ended March 31, 2017, borrowings under the Credit Facility ranged from $69.8 million to $71.1 million. As of March 31, 2017 and December 31, 2016, the Company had $0.3 million in letters of credit outstanding under the Credit Facility. The Company was in compliance with all applicable covenants under the Credit Facility as of March 31, 2017 and December 31, 2016.
|
|||
Note 4: Long-Term Debt
Solus Term Loan
On October 28, 2016, the Company entered into a new credit agreement for a $41.0 million senior secured term loan facility with Wilmington Trust, National Association, as agent for Solus Alternative Asset Management LP (“Solus”) as the lender thereto (the “Solus Term Loan”). The Solus Term Loan bears interest at a rate per annum equal to 10.5% payable quarterly in arrears. The Solus Term Loan will mature on October 28, 2020, subject to a springing maturity of March 3, 2020 if $20.0 million or more of the 2020 Notes remain outstanding as of such date, as more fully described in the Solus Term Loan credit agreement. The outstanding principal balance recorded within long-term debt on the condensed consolidated balance sheets is net of deferred financing costs and the unamortized discount totaling $3.0 million as of March 31, 2017, and $2.9 million as of December 31, 2016.
The Solus Term Loan is secured by substantially all of the assets of the Company and its domestic subsidiaries on a subordinated basis to the liens securing the Credit Facility and the MSD Term Loan. The Solus Term Loan is secured on a senior basis, with respect to the ABL Collateral (as defined in the indenture governing the 2020 Notes), and on a subordinated basis, with respect to the Notes Collateral (as defined in the indenture governing the 2020 Notes), to the liens securing the 2020 Notes. Approximately $24.0 million of the proceeds from the Solus Term Loan were loaned to JCEI, which was used to fund the cash portion of the consideration for JCHC’s parent company, Jack Cooper Enterprises, Inc. (“JCEI”), note exchanges commenced and completed by JCEI during the fourth quarter of 2016. The Solus Term Loan provides for voluntary prepayments as well as mandatory prepayments in certain circumstances, such as in a change of control or certain asset sales, and is subject to certain prepayment premiums. Further, if the Solus Term Loan is prepaid with the proceeds of a qualified equity raise within one year of entering into the agreement, the Company will pay a premium equal to 5.25% of the aggregate principal amount of the prepayment. The Solus Term Loan also contains customary affirmative and negative covenants and events of default for financings of its type.
MSD Term Loan
On March 31, 2015, the Company entered into a senior secured term loan facility (as amended, the “MSD Term Loan”) in the principal amount of $62.5 million issued at a 4.0% discount with MSDC JC Investments, LLC (“MSDC”), as agent and lender. MSDC is an affiliate of MSD Credit Opportunity Fund, L.P., a Class B stockholder of JCEI, which is the parent company of JCHC. The outstanding principal balance recorded within long-term debt on the condensed consolidated balance sheets is net of the unamortized discount and deferred financing costs totaling $2.3 million as of March 31, 2017, and $2.6 million as of December 31, 2016. The proceeds from the MSD Term Loan were used to pay down outstanding borrowings on the Credit Facility and for general corporate purposes.
Interest on the MSD Term Loan accrues at LIBOR plus 7.0% (10.0% at March 31, 2017), subject to a LIBOR floor of 3.0% per annum. The MSD Term Loan matures on October 18, 2018. The MSD Term Loan also imposes an availability block under the Credit Facility of $6.25 million so long as any indebtedness is outstanding under the MSD Term Loan (or MSDC has any commitment to extend credit resulting in incurrence of such indebtedness). The MSD Term Loan is guaranteed by certain domestic subsidiaries of the Company and is secured by substantially all of the assets of the Company and its domestic subsidiaries and a pledge of 65% of the outstanding equity of the Company’s first-tier foreign subsidiaries. MSDC’s liens have first priority status on the ABL Collateral (as defined in the indenture governing the 2020 Notes) and second priority status on the Notes Collateral (as defined in the indenture governing the 2020 Notes) to the same extent as the liens of the lenders under the Credit Facility in such assets (as contemplated by the Intercreditor Agreement (as defined in the indenture governing the 2020 Notes)), but are junior to the liens of the lenders under the Credit Facility.
2020 Notes
As of March 31, 2017, the Company had outstanding $375 million principal amount of 9.25% Senior Secured Notes due 2020 (the “2020 Notes”), issued pursuant to an indenture dated June 18, 2013. The outstanding principal balance of the 2020 Notes recorded within long-term debt on the condensed consolidated balance sheets is net of unamortized premium and debt financing costs totaling $1.8 million as of March 31, 2017, and $2.0 million as of December 31, 2016.
Interest on the 2020 Notes, accruing at a rate of 9.25% as of March 31, 2017, is payable semi-annually in cash in arrears on June 1 and December 1 of each year. The indenture governing the 2020 Notes contains certain covenants, including covenants, which, subject to certain exceptions, limit the ability of the Company and its restricted subsidiaries (as defined in the indenture) to incur additional indebtedness, engage in certain asset sales, make certain types of restricted payments, engage in transactions with affiliates and create liens on assets of the Company or the guarantors. The Company was in compliance with all applicable covenants under the indenture governing the 2020 Notes as of March 31, 2017 and December 31, 2016.
|
|||
NOTE 5: INCOME TAXES
For the three months ended March 31, 2017 and 2016, the Company determined the interim tax expense using an effective tax rate by jurisdiction which was calculated using an estimate of annual earnings and annual tax. The Company’s effective tax rate for the three months ended March 31, 2017 and 2016 was (0.7)% and (3.5)%, respectively. The accounting for income taxes requires deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax assets will not be realized. As of March 31, 2017 and December 31, 2016, the Company had $100.7 million and $96.5 million, respectively, recorded for valuation allowances. The Company released an unrecognized tax benefit as a discrete item during the three months ended March 31 2017, resulting in an income tax expense benefit of $0.3 million.
|
|||
Note 6: Commitments and ContingencieS
Letters of Credit
At March 31, 2017 and December 31, 2016, the Company had $0.3 million in outstanding letters of credit to be used as collateral for certain insurance bonds.
Litigation
On April 27, 2016, we filed a lawsuit against Applied Underwriters, Inc., Applied Underwriters Captive Risk Assurance Company (“AUCRA”), and certain of their affiliates (collectively, the “Applied Defendants”) in California State Court. JCHC alleged the following three claims in the lawsuit: (1) declaratory relief and rescission; (2) tortious breach of the implied covenant of good faith and fair dealing; and (3) fraud and misrepresentation. In connection with these claims, JCHC has demanded compensatory damages, rescission, punitive damages, and/or attorney’s fees. The claims are related to the Applied Defendants’ sale and management of JCHC’s workers’ compensation program, and specifically the Reinsurance Participation Agreements that the Applied Defendants sold to Jack Cooper starting in 2009.
On May 24, 2016, AUCRA submitted a demand for arbitration with the American Arbitration Association (“AAA”), alleging that Jack Cooper has failed to pay certain money owed to it in the amount of $9.5 million. In support of this arbitration demand, on June 14, 2016, AUCRA filed a Motion to Compel Arbitration and Stay the Action on behalf of all Applied Defendants in the California State Court, seeking to force the Company into arbitration and stay the Company’s lawsuit. On July 26, 2016, the California State Court issued an order denying AUCRA’s Motion to Compel Arbitration and Stay the Action, concluding that AUCRA’s dispute resolution provisions were void and unenforceable as a matter of law. In light of the California State Court’s order, on August 8, 2016, AAA placed AUCRA’s arbitration demand in abeyance, cancelling any pending deadlines and requesting that AUCRA provide a status update on any appeal to the California State Court’s order within twelve months.
On August 9, 2016, the Applied Defendants filed a Notice of Appeal for the California State Court’s order that denied the Motion to Compel Arbitration and Stay the Action. JCHC has opposed the Applied Defendants’ appeal, and the parties are currently awaiting the oral argument to be scheduled. We estimate that the appellate court will not decide the Applied Defendants’ appeal until later in 2017 or in 2018. In August 2017, AUCRA must pay an abeyance fee to AAA or the arbitration will be closed. At this time, we have concluded that a loss related to the Applied Defendants’ arbitration demand is not reasonably possible.
From time to time and in the ordinary course of business, the Company is a plaintiff or a defendant in other legal proceedings related to various issues, including workers’ compensation claims, tort claims, contractual disputes, and collections. The Company carries insurance that provides protection against certain types of claims, up to the policy limits of its insurance. It is the opinion of management that none of the other known legal actions will have a material adverse impact on the Company’s financial position, results of operations, or liquidity.
Other Commitments
In December of 2016, we estimated that we had triggered a full pension withdrawal liability of $0.2 million from the Central Pennsylvania Teamsters Defined Benefit Plan and as a result, we had recorded an estimated full pension withdrawal liability of $0.2 million as of March 31, 2017 and December 31, 2016.
In March 2016, the Company received a $0.3 million assessment in connection with triggering a full withdrawal from the Western Conference of Teamsters Pension Trust (the “Western Conference Trust”), which the Company had fully accrued as of December 31, 2015. In January 2017, we received a $0.3 million assessment in connection with triggering a partial withdrawal from the Western Conference Trust related to the 2013 plan year. We had total actual liabilities in the amount of $0.3 million as of March 31, 2017 and $0.5 million as of December 31, 2016 for all Western Conference Trust partial withdrawal liabilities as a result of declines in its contributions to the fund during the periods between 2011 and 2014 and the full withdrawal in 2015.
During the three months ended June 30, 2016, the Company estimated it had triggered a full withdrawal liability from the Teamsters of Philadelphia and Vicinity Pension Plan (the “Philadelphia Plan”) due to the closure of one of the Company’s terminals during the second quarter of 2016. The Company recorded a $2.9 million estimate, net of previously recorded estimated partial withdrawal liabilities, for the full withdrawal liability during the three months ended June 30, 2016. The Company recorded total assessed and estimated liabilities of $5.1 million as of March 31, 2017 and $5.3 million as of December 31, 2016 for all withdrawal liabilities from the Philadelphia Plan as a result of declines in its contributions to the fund during the periods since 2009 and the full withdrawal during 2016.
|
|||
Note 7: Fair value of financial instruments
GAAP has established a hierarchy for ranking the quality and reliability of the information used to determine fair values and requires that assets and liabilities carried at fair value be classified and disclosed in one of the following three categories:
Level 1: Unadjusted quoted market prices in active markets for identical assets or liabilities.
Level 2: Unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.
Level 3: Unobservable inputs for the asset or liability.
The Company utilizes the best available information in measuring fair value. Assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. Cash and cash equivalents, accounts receivable and payables approximate fair value due to their liquid and short term nature. The estimated fair value of the 2020 Notes outstanding at March 31, 2017 and December 31, 2016 was approximately $134.1 million and $162.2 million, respectively. The estimated fair value of the remaining outstanding debt (including the unsecured debt and outstanding balance on the Credit Facility, MSD Term Loan and Solus Term Loan) was approximately $189.6 million and $193.2 million at March 31, 2017 and December 31, 2016, respectively. The fair value was estimated by comparing interest rates to debt with similar terms and maturities, except for the fair values of the 2020 Notes which were based on quoted prices in markets that are not active, which represents a Level 2 input in the fair value hierarchy.
|
|||
NOTE 8: GOODWILL AND ACQUIRED INTANGIBLE ASSETS
The Company had total goodwill of $32.2 million and $32.0 million as of March 31, 2017 and December 31, 2016, respectively, and net intangible assets of $25.9 million and $26.3 million as of March 31, 2017 and December 31, 2016, respectively.
The tables below present the change in carrying values by segment:
|
|
|
Indefinite-Lived |
|
Definite-Lived |
|
|
|
|
||||||||
|
Transport Segment |
|
|
|
Customer |
|
Customer |
|
Non-Compete |
|
Total |
|
|||||
|
(in thousands) |
|
Goodwill |
|
Relationships |
|
Relationships |
|
Agreement |
|
Intangibles |
|
|||||
|
Balance at December 31, 2016 |
|
$ |
25,144 |
|
$ |
20,356 |
|
$ |
4,209 |
|
$ |
— |
|
$ |
24,565 |
|
|
Amortization |
|
|
— |
|
|
— |
|
|
(334) |
|
|
— |
|
|
(334) |
|
|
Balance at March 31, 2017 |
|
$ |
25,144 |
|
$ |
20,356 |
|
$ |
3,875 |
|
$ |
— |
|
$ |
24,231 |
|
|
|
|
Indefinite-Lived |
|
Definite-Lived |
|
|
|
|
|||||||||||
|
Logistics Segment |
|
|
|
|
Customer |
|
Vendor |
|
Non-Compete |
|
|
|
|
Total |
|
||||
|
(in thousands) |
|
Goodwill |
|
Relationships |
|
Relationships |
|
Agreement |
|
Trade Names |
|
Intangibles |
|
||||||
|
Balance at December 31, 2016 |
|
$ |
6,894 |
|
$ |
661 |
|
$ |
— |
|
$ |
— |
|
$ |
1,118 |
|
$ |
1,779 |
|
|
Amortization |
|
|
— |
|
|
(183) |
|
|
— |
|
|
— |
|
|
— |
|
|
(183) |
|
|
Currency translation adjustment |
|
|
113 |
|
|
31 |
|
|
— |
|
|
— |
|
|
21 |
|
|
52 |
|
|
Balance at March 31, 2017 |
|
$ |
7,007 |
|
$ |
509 |
|
$ |
— |
|
$ |
— |
|
$ |
1,139 |
|
$ |
1,648 |
|
|
|||
|
|||
Note 10: Segment Reporting
The Company had two reportable segments at March 31, 2017 and 2016: the Transport segment and the Logistics segment.
Transport Segment. The Transport segment provides automotive transportation services to original equipment manufacturers (“OEMs”) of automobiles and light trucks in the U.S. and Canada. Specific services include (i) transportation of new vehicles from OEM assembly centers, vehicle distribution centers and port sites to dealers or other intermediate destinations, in connection with which the Company collects fuel surcharges; and (ii) certain asset-light services such as rail car loading and gate releasing services at OEM assembly centers and related new vehicle inspection services. The average length of haul is approximately 170 miles, though lengths of haul range from less than a mile up to approximately 2,400 miles. The consolidated entities that comprise the Transport segment are: Jack Cooper Transport Company, Inc. and its wholly owned subsidiaries, and Jack Cooper Transport Canada, Inc. and its wholly owned subsidiaries.
Logistics Segment. The Logistics segment engages in the global asset-light automotive supply chain for new and used finished vehicles and includes: (i) brokerage of transportation of used vehicles, including vehicles sold through automotive auction process and (ii) services within the growing remarketed vehicle sector, in which our customers are typically OEM remarketing departments, automotive auction companies and logistics brokers, including brokering of the international shipment of cars and trucks from various ports in the U.S. to various international destinations; inspection and title storage services for pre-owned and off-lease vehicles; and supply chain management services as well as rail and yard management and port processing. Customers contract through AES to ship vehicles and equipment using space purchased on third-party vessels. Other items shipped include heavy construction equipment, farm equipment and commercial trucking vehicles.
The consolidated entities that comprise the Logistics segment are Jack Cooper Logistics, LLC and AES, and their wholly-owned subsidiaries, including, Axis Logistics Services, Inc., Jack Cooper CT Services, Inc., Jack Cooper Rail & Shuttle, Inc. and five Mexican operating companies.
The following table provides information on the two segments as of and for the three months ended March 31, 2017 and 2016:
|
|
|
2017 |
|
|||||||||||||
|
(in thousands) |
|
Transport |
|
Logistics |
|
Segments Total |
|
Corporate |
|
Consolidated |
|
|||||
|
Sales to external customers |
|
$ |
148,229 |
|
$ |
13,174 |
|
$ |
161,403 |
|
$ |
— |
|
$ |
161,403 |
|
|
Operating income (loss) |
|
|
5,460 |
|
|
337 |
|
|
5,797 |
|
|
(418) |
|
|
5,379 |
|
|
Capital expenditures |
|
|
4,454 |
|
|
154 |
|
|
4,608 |
|
|
— |
|
|
4,608 |
|
|
Total assets |
|
|
257,891 |
|
|
23,828 |
|
|
281,719 |
|
|
3,099 |
|
|
284,818 |
|
|
|
|
2016 |
|
|||||||||||||
|
(in thousands) |
|
Transport |
|
Logistics |
|
Segments Total |
|
Corporate |
|
Consolidated |
|
|||||
|
Sales to external customers |
|
$ |
157,938 |
|
$ |
17,833 |
|
$ |
175,771 |
|
$ |
— |
|
$ |
175,771 |
|
|
Operating income (loss) |
|
|
401 |
|
|
1,440 |
|
|
1,841 |
|
|
(467) |
|
|
1,374 |
|
|
Capital expenditures |
|
|
5,883 |
|
|
88 |
|
|
5,971 |
|
|
213 |
|
|
6,184 |
|
|
Total assets |
|
|
274,804 |
|
|
24,234 |
|
|
299,038 |
|
|
3,481 |
|
|
302,519 |
|
Administrative services provided by the corporate office allocated to the individual segments represent corporate services rendered to and costs incurred for each segment including allocation of general corporate management oversight costs.
|
|||
NOTE 11: CONDENSED CONSOLIDATING SUBSIDIARY GUARANTOR FINANCIAL INFORMATION
The following tables present condensed consolidating financial statements under the equity method of (a) the parent company, Jack Cooper Holdings Corp., as issuer of the 2020 Notes; (b) the subsidiary guarantors of the 2020 Notes; and (c) the subsidiaries that are not guarantors of the 2020 Notes. Separate financial statements of the subsidiary guarantors are not presented because the Company owns all outstanding voting stock of each of the subsidiary guarantors and the guarantee by each subsidiary guarantor is full and unconditional and joint and several. As a result and in accordance with Rule 3-10(f) of Regulation S-X under the Securities Exchange Act of 1934, as amended, the Company includes the following tables in these notes to the condensed consolidated financial statements:
|
|
|
Three Months Ended March 31, 2017 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
|||
|
Condensed Consolidating Statements of Comprehensive Income (Loss): |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Revenues |
|
$ |
— |
|
$ |
153,087 |
|
$ |
10,376 |
|
$ |
(2,060) |
|
$ |
161,403 |
|
|
Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
|
— |
|
|
79,567 |
|
|
4,145 |
|
|
— |
|
|
83,712 |
|
|
Fuel |
|
|
— |
|
|
13,048 |
|
|
1,103 |
|
|
— |
|
|
14,151 |
|
|
Depreciation and amortization |
|
|
55 |
|
|
8,701 |
|
|
606 |
|
|
— |
|
|
9,362 |
|
|
Repairs and maintenance |
|
|
— |
|
|
10,461 |
|
|
977 |
|
|
— |
|
|
11,438 |
|
|
Other operating |
|
|
— |
|
|
23,514 |
|
|
2,610 |
|
|
(1,701) |
|
|
24,423 |
|
|
Selling, general and administrative expenses |
|
|
365 |
|
|
11,814 |
|
|
860 |
|
|
(359) |
|
|
12,680 |
|
|
Gain (loss) on disposal of property and equipment |
|
|
— |
|
|
318 |
|
|
(60) |
|
|
— |
|
|
258 |
|
|
Total operating expenses |
|
|
420 |
|
|
147,423 |
|
|
10,241 |
|
|
(2,060) |
|
|
156,024 |
|
|
Operating Income (Loss) |
|
|
(420) |
|
|
5,664 |
|
|
135 |
|
|
— |
|
|
5,379 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expense (Income) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense (income), net |
|
|
12,891 |
|
|
(164) |
|
|
112 |
|
|
— |
|
|
12,839 |
|
|
Other, net |
|
|
— |
|
|
— |
|
|
(626) |
|
|
— |
|
|
(626) |
|
|
Equity in loss of consolidated subsidiaries |
|
|
(6,421) |
|
|
(845) |
|
|
— |
|
|
7,266 |
|
|
— |
|
|
Income (Loss) Before Income Taxes |
|
|
(6,890) |
|
|
6,673 |
|
|
649 |
|
|
(7,266) |
|
|
(6,834) |
|
|
Provision (Benefit) for Income Taxes |
|
|
— |
|
|
252 |
|
|
(196) |
|
|
— |
|
|
56 |
|
|
Net Income (Loss) |
|
|
(6,890) |
|
|
6,421 |
|
|
845 |
|
|
(7,266) |
|
|
(6,890) |
|
|
Equity in other comprehensive loss of consolidated subsidiaries |
|
|
(308) |
|
|
(327) |
|
|
— |
|
|
635 |
|
|
— |
|
|
Other comprehensive income (loss), net of tax |
|
|
— |
|
|
19 |
|
|
(327) |
|
|
— |
|
|
(308) |
|
|
Comprehensive Income (Loss) |
|
$ |
(7,198) |
|
$ |
6,113 |
|
$ |
518 |
|
$ |
(6,631) |
|
$ |
(7,198) |
|
|
|
|
Three Months Ended March 31, 2016 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
|||
|
Condensed Consolidating Statements of Comprehensive Income (Loss): |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Revenues |
|
$ |
— |
|
$ |
166,761 |
|
$ |
13,105 |
|
$ |
(4,095) |
|
$ |
175,771 |
|
|
Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
|
— |
|
|
83,831 |
|
|
6,860 |
|
|
— |
|
|
90,691 |
|
|
Fuel |
|
|
— |
|
|
11,410 |
|
|
1,408 |
|
|
— |
|
|
12,818 |
|
|
Depreciation and amortization |
|
|
59 |
|
|
11,360 |
|
|
1,485 |
|
|
— |
|
|
12,904 |
|
|
Repairs and maintenance |
|
|
— |
|
|
12,024 |
|
|
1,556 |
|
|
— |
|
|
13,580 |
|
|
Other operating |
|
|
— |
|
|
29,962 |
|
|
4,447 |
|
|
(3,489) |
|
|
30,920 |
|
|
Selling, general and administrative expenses |
|
|
407 |
|
|
11,964 |
|
|
1,060 |
|
|
(606) |
|
|
12,825 |
|
|
Loss on disposal of property and equipment |
|
|
— |
|
|
341 |
|
|
318 |
|
|
— |
|
|
659 |
|
|
Total operating expenses |
|
|
466 |
|
|
160,892 |
|
|
17,134 |
|
|
(4,095) |
|
|
174,397 |
|
|
Comprehensive Income (Loss) |
|
|
(466) |
|
|
5,869 |
|
|
(4,029) |
|
|
— |
|
|
1,374 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expense (Income) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense (income), net |
|
|
11,560 |
|
|
(132) |
|
|
110 |
|
|
— |
|
|
11,538 |
|
|
Other, net |
|
|
— |
|
|
2 |
|
|
(2,808) |
|
|
— |
|
|
(2,806) |
|
|
Equity in loss (income) of consolidated subsidiaries |
|
|
(4,413) |
|
|
1,332 |
|
|
— |
|
|
3,081 |
|
|
— |
|
|
Income (Loss) Before Income Taxes |
|
|
(7,613) |
|
|
4,667 |
|
|
(1,331) |
|
|
(3,081) |
|
|
(7,358) |
|
|
Provision for Income Taxes |
|
|
— |
|
|
254 |
|
|
1 |
|
|
— |
|
|
255 |
|
|
Net Income (Loss) |
|
|
(7,613) |
|
|
4,413 |
|
|
(1,332) |
|
|
(3,081) |
|
|
(7,613) |
|
|
Equity in other comprehensive loss of consolidated subsidiaries |
|
|
(1,970) |
|
|
(1,991) |
|
|
— |
|
|
3,961 |
|
|
— |
|
|
Other comprehensive income (loss), net of tax |
|
|
— |
|
|
21 |
|
|
(1,991) |
|
|
— |
|
|
(1,970) |
|
|
Comprehensive Income (Loss) |
|
$ |
(9,583) |
|
$ |
2,443 |
|
$ |
(3,323) |
|
$ |
880 |
|
$ |
(9,583) |
|
|
|
|
As of March 31, 2017 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
|
|
Condensed Consolidating Balance Sheet: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
— |
|
$ |
17,882 |
|
$ |
5,025 |
|
$ |
— |
|
$ |
22,907 |
|
|
Accounts receivable, net of allowance |
|
|
— |
|
|
47,769 |
|
|
1,057 |
|
|
(292) |
|
|
48,534 |
|
|
Prepaid expenses |
|
|
265 |
|
|
16,549 |
|
|
747 |
|
|
— |
|
|
17,561 |
|
|
Assets held for sale |
|
|
— |
|
|
71 |
|
|
51 |
|
|
— |
|
|
122 |
|
|
Total current assets |
|
|
265 |
|
|
82,271 |
|
|
6,880 |
|
|
(292) |
|
|
89,124 |
|
|
Restricted cash |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Investment in affiliates |
|
|
(21,570) |
|
|
(17,691) |
|
|
— |
|
|
39,261 |
|
|
— |
|
|
Property and equipment, net |
|
|
2,831 |
|
|
98,130 |
|
|
5,387 |
|
|
— |
|
|
106,348 |
|
|
Goodwill |
|
|
— |
|
|
30,980 |
|
|
1,171 |
|
|
— |
|
|
32,151 |
|
|
Intangibles, net |
|
|
— |
|
|
25,358 |
|
|
521 |
|
|
— |
|
|
25,879 |
|
|
Deposits and other assets |
|
|
477 |
|
|
30,403 |
|
|
316 |
|
|
— |
|
|
31,196 |
|
|
Intercompany receivables |
|
|
216,859 |
|
|
94,754 |
|
|
— |
|
|
(311,613) |
|
|
— |
|
|
Total assets |
|
$ |
198,862 |
|
$ |
344,325 |
|
$ |
14,275 |
|
$ |
(272,644) |
|
$ |
284,818 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit Facility |
|
$ |
69,764 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
69,764 |
|
|
Current maturities of long-term debt |
|
|
56 |
|
|
1,670 |
|
|
— |
|
|
— |
|
|
1,726 |
|
|
Accounts payable |
|
|
56 |
|
|
21,447 |
|
|
1,357 |
|
|
(288) |
|
|
22,572 |
|
|
Accrued wages and vacation payable |
|
|
— |
|
|
20,393 |
|
|
1,771 |
|
|
— |
|
|
22,164 |
|
|
Other accrued liabilities |
|
|
13,235 |
|
|
13,937 |
|
|
1,280 |
|
|
— |
|
|
28,452 |
|
|
Total current liabilities |
|
|
83,111 |
|
|
57,447 |
|
|
4,408 |
|
|
(288) |
|
|
144,678 |
|
|
Other liabilities |
|
|
— |
|
|
7,047 |
|
|
343 |
|
|
— |
|
|
7,390 |
|
|
Long-term debt, less current maturities |
|
|
473,121 |
|
|
4,702 |
|
|
— |
|
|
— |
|
|
477,823 |
|
|
Pension liability |
|
|
— |
|
|
2,195 |
|
|
— |
|
|
— |
|
|
2,195 |
|
|
Deferred income taxes |
|
|
— |
|
|
10,034 |
|
|
68 |
|
|
— |
|
|
10,102 |
|
|
Intercompany payables |
|
|
— |
|
|
284,470 |
|
|
27,147 |
|
|
(311,617) |
|
|
— |
|
|
Total liabilities |
|
|
556,232 |
|
|
365,895 |
|
|
31,966 |
|
|
(311,905) |
|
|
642,188 |
|
|
Stockholders' Deficit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' deficit |
|
|
(357,370) |
|
|
(21,570) |
|
|
(17,691) |
|
|
39,261 |
|
|
(357,370) |
|
|
Commitments and Contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders' deficit |
|
$ |
198,862 |
|
$ |
344,325 |
|
$ |
14,275 |
|
$ |
(272,644) |
|
$ |
284,818 |
|
|
|
|
As of December 31, 2016 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
||
|
Condensed Consolidating Balance Sheet: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
— |
|
$ |
14,199 |
|
$ |
3,735 |
|
$ |
— |
|
$ |
17,934 |
|
|
Accounts receivable, net of allowance |
|
|
— |
|
|
45,466 |
|
|
— |
|
|
(325) |
|
|
45,141 |
|
|
Prepaid expenses |
|
|
184 |
|
|
15,529 |
|
|
591 |
|
|
— |
|
|
16,304 |
|
|
Assets held for sale |
|
|
— |
|
|
71 |
|
|
55 |
|
|
— |
|
|
126 |
|
|
Total current assets |
|
|
184 |
|
|
75,265 |
|
|
4,381 |
|
|
(325) |
|
|
79,505 |
|
|
Restricted cash |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Investment in affiliates |
|
|
(27,857) |
|
|
(18,390) |
|
|
— |
|
|
46,247 |
|
|
— |
|
|
Property and equipment, net |
|
|
2,885 |
|
|
102,285 |
|
|
5,857 |
|
|
— |
|
|
111,027 |
|
|
Goodwill |
|
|
— |
|
|
30,980 |
|
|
1,058 |
|
|
— |
|
|
32,038 |
|
|
Intangibles, net |
|
|
— |
|
|
25,827 |
|
|
517 |
|
|
— |
|
|
26,344 |
|
|
Deposits and other assets |
|
|
572 |
|
|
29,123 |
|
|
383 |
|
|
— |
|
|
30,078 |
|
|
Intercompany receivables |
|
|
222,832 |
|
|
84,026 |
|
|
— |
|
|
(306,858) |
|
|
— |
|
|
Total assets |
|
$ |
198,616 |
|
$ |
329,236 |
|
$ |
12,196 |
|
$ |
(260,936) |
|
$ |
279,112 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit Facility |
|
$ |
71,039 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
71,039 |
|
|
Current maturities of long-term debt |
|
|
56 |
|
|
1,849 |
|
|
— |
|
|
— |
|
|
1,905 |
|
|
Accounts payable |
|
|
60 |
|
|
21,577 |
|
|
1,167 |
|
|
(38) |
|
|
22,766 |
|
|
Accrued wages and vacation payable |
|
|
— |
|
|
15,760 |
|
|
2,362 |
|
|
(255) |
|
|
17,867 |
|
|
Other accrued liabilities |
|
|
4,686 |
|
|
12,472 |
|
|
864 |
|
|
— |
|
|
18,022 |
|
|
Total current liabilities |
|
|
75,841 |
|
|
51,658 |
|
|
4,393 |
|
|
(293) |
|
|
131,599 |
|
|
Other liabilities |
|
|
— |
|
|
6,836 |
|
|
679 |
|
|
— |
|
|
7,515 |
|
|
Long-term debt, less current maturities |
|
|
472,628 |
|
|
5,056 |
|
|
— |
|
|
— |
|
|
477,684 |
|
|
Pension liability |
|
|
— |
|
|
2,198 |
|
|
— |
|
|
— |
|
|
2,198 |
|
|
Deferred income taxes |
|
|
— |
|
|
9,908 |
|
|
61 |
|
|
— |
|
|
9,969 |
|
|
Intercompany payables |
|
|
— |
|
|
281,437 |
|
|
25,453 |
|
|
(306,890) |
|
|
— |
|
|
Total liabilities |
|
|
548,469 |
|
|
357,093 |
|
|
30,586 |
|
|
(307,183) |
|
|
628,965 |
|
|
Stockholders' Deficit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' deficit |
|
|
(349,853) |
|
|
(27,857) |
|
|
(18,390) |
|
|
46,247 |
|
|
(349,853) |
|
|
Commitments and Contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders' deficit |
|
$ |
198,616 |
|
$ |
329,236 |
|
$ |
12,196 |
|
$ |
(260,936) |
|
$ |
279,112 |
|
|
|
|
Three Months Ended March 31, 2017 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
||
|
Condensed Consolidating Statements of Cash Flows: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
$ |
1,503 |
|
$ |
9,046 |
|
$ |
1,097 |
|
$ |
— |
|
$ |
11,646 |
|
|
Investing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale of property and equipment |
|
|
— |
|
|
175 |
|
|
76 |
|
|
— |
|
|
251 |
|
|
Purchases of property and equipment |
|
|
— |
|
|
(4,562) |
|
|
(46) |
|
|
— |
|
|
(4,608) |
|
|
Net cash provided by (used in) investing activities |
|
|
— |
|
|
(4,387) |
|
|
30 |
|
|
— |
|
|
(4,357) |
|
|
Financing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments on revolving Credit Facility |
|
|
(1,275) |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,275) |
|
|
Principal payments on long-term debt and other liabilities |
|
|
(13) |
|
|
(976) |
|
|
— |
|
|
— |
|
|
(989) |
|
|
Deferred financing costs |
|
|
(215) |
|
|
— |
|
|
— |
|
|
— |
|
|
(215) |
|
|
Net cash used in financing activities |
|
|
(1,503) |
|
|
(976) |
|
|
— |
|
|
— |
|
|
(2,479) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate change on cash |
|
|
— |
|
|
— |
|
|
163 |
|
|
— |
|
|
163 |
|
|
Increase in Cash, Cash Equivalents and Restricted Cash |
|
|
— |
|
|
3,683 |
|
|
1,290 |
|
|
— |
|
|
4,973 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
|
— |
|
|
14,319 |
|
|
3,735 |
|
|
— |
|
|
18,054 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
18,002 |
|
$ |
5,025 |
|
$ |
— |
|
$ |
23,027 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Cash, and Cash Equivalents and Restricted Cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period |
|
|
— |
|
|
14,199 |
|
|
3,735 |
|
|
— |
|
|
17,934 |
|
|
Restricted cash, beginning of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
$ |
— |
|
$ |
14,319 |
|
$ |
3,735 |
|
$ |
— |
|
$ |
18,054 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
|
— |
|
|
17,882 |
|
|
5,025 |
|
|
— |
|
|
22,907 |
|
|
Restricted cash, end of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
18,002 |
|
$ |
5,025 |
|
$ |
— |
|
$ |
23,027 |
|
|
|
|
Three Months Ended March 31, 2016 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
||
|
Condensed Consolidating Statements of Cash Flows: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities |
|
$ |
(7,526) |
|
$ |
7,359 |
|
$ |
1,699 |
|
$ |
218 |
|
$ |
1,750 |
|
|
Investing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale of property and equipment |
|
|
— |
|
|
1 |
|
|
6 |
|
|
— |
|
|
7 |
|
|
Purchases of property and equipment |
|
|
(213) |
|
|
(5,910) |
|
|
(61) |
|
|
— |
|
|
(6,184) |
|
|
Intercompany receivables |
|
|
— |
|
|
— |
|
|
(687) |
|
|
687 |
|
|
— |
|
|
Net cash used in investing activities |
|
|
(213) |
|
|
(5,909) |
|
|
(742) |
|
|
687 |
|
|
(6,177) |
|
|
Financing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings under Credit Facility |
|
|
38,906 |
|
|
— |
|
|
— |
|
|
— |
|
|
38,906 |
|
|
Payments on revolving Credit Facility |
|
|
(31,154) |
|
|
— |
|
|
— |
|
|
— |
|
|
(31,154) |
|
|
Principal payments on long-term debt and other liabilities |
|
|
(13) |
|
|
(1,923) |
|
|
— |
|
|
— |
|
|
(1,936) |
|
|
Intercompany payables |
|
|
— |
|
|
687 |
|
|
— |
|
|
(687) |
|
|
— |
|
|
Net cash provided by (used in) financing activities |
|
|
7,739 |
|
|
(1,236) |
|
|
— |
|
|
(687) |
|
|
5,816 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate change on cash |
|
|
— |
|
|
— |
|
|
121 |
|
|
— |
|
|
121 |
|
|
Increase in Cash, Cash Equivalents and Restricted Cash |
|
|
— |
|
|
214 |
|
|
1,078 |
|
|
218 |
|
|
1,510 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
|
— |
|
|
120 |
|
|
2,789 |
|
|
(218) |
|
|
2,691 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
334 |
|
$ |
3,867 |
|
$ |
— |
|
$ |
4,201 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Cash, and Cash Equivalents and Restricted Cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period |
|
|
— |
|
|
— |
|
|
2,789 |
|
|
(218) |
|
|
2,571 |
|
|
Restricted cash, beginning of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
$ |
— |
|
$ |
120 |
|
$ |
2,789 |
|
$ |
(218) |
|
$ |
2,691 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
|
— |
|
|
214 |
|
|
3,867 |
|
|
— |
|
|
4,081 |
|
|
Restricted cash, end of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
334 |
|
$ |
3,867 |
|
$ |
— |
|
$ |
4,201 |
|
|
|||
NOTE 12: SUBSEQUENT EVENTS
Exchange Offers
On April 3, 2017, JCHC commenced a private offer to exchange with eligible holders any and all of JCHC’s outstanding 2020 Notes for cash and warrants issued by JCEI exercisable for shares of Class B common stock of JCEI, and a related solicitation of consents to amend the existing 2020 Notes and related indenture and release the collateral securing the existing 2020 Notes. For each $1,000 principal amount of 2020 Notes validly tendered at or before April 17, 2017 and not validly withdrawn, eligible holders of 2020 Notes will be eligible to receive 2.47 warrants to purchase shares of Class B Common Stock and $350 in cash, which includes the consent payment of $50 for the existing 2020 Notes. For each $1,000 principal amount of 2020 Notes validly tendered after April 17, 2017 but prior to the expiration of the exchange offer, eligible holders of 2020 Notes will be eligible to receive $300 in cash and 2.47 warrants to purchase shares of Class B Common Stock, subject to proration.
Concurrently, on April 3, 2017, JCEI launched an offer to exchange $58,640,415 of its outstanding 10.50%/11.25% Senior PIK Toggle Notes due 2019 (the “JCEI Notes”) for cash, and a related solicitation of consents amend the existing JCEI Notes and related indenture. For each $1,000 principal amount of JCEI Notes validly tendered at or before April 17, 2017 and not validly withdrawn, eligible holders of JCEI Notes will be eligible to receive $150 in cash, which includes the consent payment of $11.50 for the existing JCEI Notes. For each $1,000 principal amount of JCEI Notes validly tendered after April 17, 2017 but prior to the expiration of the exchange offer, eligible holders of JCEI Notes will be eligible to receive $138.50 in cash.
On May 1, 2017, JCEI announced an extension of the offers by 14 days. The offers and the consent solicitations will expire on May 15, 2017, unless extended or earlier terminated.
|
|||
Revenue
The Company primarily earns revenues under multi-year or single-year contracts from the intrastate and interstate transportation of vehicles. Approximately 47%, 34%, and 7% of the Company’s revenues were from its three largest customers, General Motors Company (“GM”), Ford Motor Company (“Ford”), and Toyota Motor Sales, USA, Inc. (“Toyota”), respectively, for the three months ended March 31, 2017, and 45%, 34%, and 13%, respectively, for the three months ended March 31, 2016. These customers also collectively represented approximately 66% of accounts receivable at March 31, 2017 and 64% at December 31, 2016. The allowance for doubtful accounts totaled $1.0 million and $1.3 million as of March 31, 2017 and December 31, 2016, respectively.
Foreign Currency
The Company’s financial condition and results of operations are recorded in multiple currencies, including the Canadian dollar and the Mexican peso, and the Company has an accounts receivable balance denominated in Nigerian naira. Assets and liabilities of subsidiaries whose functional currency is not the U.S. dollar were translated at the exchange rate in effect at the balance sheet date, and revenues and expenses were translated at average exchange rates for the period. Translation adjustments are included in other comprehensive income (loss). Gains and losses on certain of the Company's intercompany loans are included in other, net in the condensed consolidated statements of comprehensive loss due to the intercompany loans not being considered long-term investment in nature.
Use of Estimates
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions about future events relating to the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of expenses during the reporting periods. Significant items subject to such estimates and assumptions include those related to workers’ compensation insurance, pension withdrawal liabilities, allowance for doubtful accounts, the recoverability and useful lives of assets, litigation provisions and income taxes. Estimates are revised when facts and circumstances change. As such, actual results could differ materially from those estimates.
Recently Adopted Accounting Standards
In November 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-18 which clarifies the presentation requirements of restricted cash within the statement of cash flows. The changes in restricted cash and restricted cash equivalents during the period should be included in the beginning and ending cash and cash equivalents balance reconciliation on the statement of cash flows. When cash, cash equivalents, restricted cash or restricted cash equivalents are presented in more than one line item within the statement of financial position, an entity shall calculate a total cash amount in a narrative or tabular format that agrees to the amount shown on the statement of cash flows. Details on the nature and amounts of restricted cash should also be disclosed. This standard is effective for fiscal years beginning after December 15, 2017, including interim periods within that reporting period. As permitted in the standard, this new guidance was early adopted by the Company in the first quarter of 2017. As a result of adopting this standard on January 1, 2017, restricted cash of $0.1 million as of March 31, 2017 and 2016, and restricted cash activity are disclosed separately within the cash flow statement. Restricted cash as of March 31, 2017 and 2016 represented certificates of deposits related to merchant services provided by the Company.
In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which provides for simplification of certain aspects of employee share-based payment accounting including income taxes, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The standard was adopted by the Company January 1, 2017 and was applied prospectively. Excess tax benefits or deficiencies resulting from the exercise or vesting of awards are included in income tax expense in the reporting period in which they occur. No prior or current period financial or cash flow statements were impacted as a result of this change in accounting policy.
|
|||
|
|
|
March 31, |
|
December 31, |
|
||
|
(in thousands) |
|
2017 |
|
2016 |
|
||
|
Land |
|
$ |
7,045 |
|
$ |
7,045 |
|
|
Carrier revenue equipment |
|
|
275,516 |
|
|
272,846 |
|
|
Buildings and equipment |
|
|
39,732 |
|
|
39,007 |
|
|
Leasehold improvements |
|
|
2,778 |
|
|
2,710 |
|
|
Construction in process |
|
|
3,336 |
|
|
4,168 |
|
|
|
|
|
328,407 |
|
|
325,776 |
|
|
Less: accumulated depreciation |
|
|
222,059 |
|
|
214,749 |
|
|
Property and equipment, net |
|
$ |
106,348 |
|
$ |
111,027 |
|
|
|||
|
|
|
Indefinite-Lived |
|
Definite-Lived |
|
|
|
|
||||||||
|
Transport Segment |
|
|
|
Customer |
|
Customer |
|
Non-Compete |
|
Total |
|
|||||
|
(in thousands) |
|
Goodwill |
|
Relationships |
|
Relationships |
|
Agreement |
|
Intangibles |
|
|||||
|
Balance at December 31, 2016 |
|
$ |
25,144 |
|
$ |
20,356 |
|
$ |
4,209 |
|
$ |
— |
|
$ |
24,565 |
|
|
Amortization |
|
|
— |
|
|
— |
|
|
(334) |
|
|
— |
|
|
(334) |
|
|
Balance at March 31, 2017 |
|
$ |
25,144 |
|
$ |
20,356 |
|
$ |
3,875 |
|
$ |
— |
|
$ |
24,231 |
|
|
|
|
Indefinite-Lived |
|
Definite-Lived |
|
|
|
|
|||||||||||
|
Logistics Segment |
|
|
|
|
Customer |
|
Vendor |
|
Non-Compete |
|
|
|
|
Total |
|
||||
|
(in thousands) |
|
Goodwill |
|
Relationships |
|
Relationships |
|
Agreement |
|
Trade Names |
|
Intangibles |
|
||||||
|
Balance at December 31, 2016 |
|
$ |
6,894 |
|
$ |
661 |
|
$ |
— |
|
$ |
— |
|
$ |
1,118 |
|
$ |
1,779 |
|
|
Amortization |
|
|
— |
|
|
(183) |
|
|
— |
|
|
— |
|
|
— |
|
|
(183) |
|
|
Currency translation adjustment |
|
|
113 |
|
|
31 |
|
|
— |
|
|
— |
|
|
21 |
|
|
52 |
|
|
Balance at March 31, 2017 |
|
$ |
7,007 |
|
$ |
509 |
|
$ |
— |
|
$ |
— |
|
$ |
1,139 |
|
$ |
1,648 |
|
|
|||
|
|
|
2017 |
|
|||||||||||||
|
(in thousands) |
|
Transport |
|
Logistics |
|
Segments Total |
|
Corporate |
|
Consolidated |
|
|||||
|
Sales to external customers |
|
$ |
148,229 |
|
$ |
13,174 |
|
$ |
161,403 |
|
$ |
— |
|
$ |
161,403 |
|
|
Operating income (loss) |
|
|
5,460 |
|
|
337 |
|
|
5,797 |
|
|
(418) |
|
|
5,379 |
|
|
Capital expenditures |
|
|
4,454 |
|
|
154 |
|
|
4,608 |
|
|
— |
|
|
4,608 |
|
|
Total assets |
|
|
257,891 |
|
|
23,828 |
|
|
281,719 |
|
|
3,099 |
|
|
284,818 |
|
|
|
|
2016 |
|
|||||||||||||
|
(in thousands) |
|
Transport |
|
Logistics |
|
Segments Total |
|
Corporate |
|
Consolidated |
|
|||||
|
Sales to external customers |
|
$ |
157,938 |
|
$ |
17,833 |
|
$ |
175,771 |
|
$ |
— |
|
$ |
175,771 |
|
|
Operating income (loss) |
|
|
401 |
|
|
1,440 |
|
|
1,841 |
|
|
(467) |
|
|
1,374 |
|
|
Capital expenditures |
|
|
5,883 |
|
|
88 |
|
|
5,971 |
|
|
213 |
|
|
6,184 |
|
|
Total assets |
|
|
274,804 |
|
|
24,234 |
|
|
299,038 |
|
|
3,481 |
|
|
302,519 |
|
|
|||
|
|
|
Three Months Ended March 31, 2017 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
|||
|
Condensed Consolidating Statements of Comprehensive Income (Loss): |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Revenues |
|
$ |
— |
|
$ |
153,087 |
|
$ |
10,376 |
|
$ |
(2,060) |
|
$ |
161,403 |
|
|
Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
|
— |
|
|
79,567 |
|
|
4,145 |
|
|
— |
|
|
83,712 |
|
|
Fuel |
|
|
— |
|
|
13,048 |
|
|
1,103 |
|
|
— |
|
|
14,151 |
|
|
Depreciation and amortization |
|
|
55 |
|
|
8,701 |
|
|
606 |
|
|
— |
|
|
9,362 |
|
|
Repairs and maintenance |
|
|
— |
|
|
10,461 |
|
|
977 |
|
|
— |
|
|
11,438 |
|
|
Other operating |
|
|
— |
|
|
23,514 |
|
|
2,610 |
|
|
(1,701) |
|
|
24,423 |
|
|
Selling, general and administrative expenses |
|
|
365 |
|
|
11,814 |
|
|
860 |
|
|
(359) |
|
|
12,680 |
|
|
Gain (loss) on disposal of property and equipment |
|
|
— |
|
|
318 |
|
|
(60) |
|
|
— |
|
|
258 |
|
|
Total operating expenses |
|
|
420 |
|
|
147,423 |
|
|
10,241 |
|
|
(2,060) |
|
|
156,024 |
|
|
Operating Income (Loss) |
|
|
(420) |
|
|
5,664 |
|
|
135 |
|
|
— |
|
|
5,379 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expense (Income) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense (income), net |
|
|
12,891 |
|
|
(164) |
|
|
112 |
|
|
— |
|
|
12,839 |
|
|
Other, net |
|
|
— |
|
|
— |
|
|
(626) |
|
|
— |
|
|
(626) |
|
|
Equity in loss of consolidated subsidiaries |
|
|
(6,421) |
|
|
(845) |
|
|
— |
|
|
7,266 |
|
|
— |
|
|
Income (Loss) Before Income Taxes |
|
|
(6,890) |
|
|
6,673 |
|
|
649 |
|
|
(7,266) |
|
|
(6,834) |
|
|
Provision (Benefit) for Income Taxes |
|
|
— |
|
|
252 |
|
|
(196) |
|
|
— |
|
|
56 |
|
|
Net Income (Loss) |
|
|
(6,890) |
|
|
6,421 |
|
|
845 |
|
|
(7,266) |
|
|
(6,890) |
|
|
Equity in other comprehensive loss of consolidated subsidiaries |
|
|
(308) |
|
|
(327) |
|
|
— |
|
|
635 |
|
|
— |
|
|
Other comprehensive income (loss), net of tax |
|
|
— |
|
|
19 |
|
|
(327) |
|
|
— |
|
|
(308) |
|
|
Comprehensive Income (Loss) |
|
$ |
(7,198) |
|
$ |
6,113 |
|
$ |
518 |
|
$ |
(6,631) |
|
$ |
(7,198) |
|
|
|
|
Three Months Ended March 31, 2016 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
|||
|
Condensed Consolidating Statements of Comprehensive Income (Loss): |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Revenues |
|
$ |
— |
|
$ |
166,761 |
|
$ |
13,105 |
|
$ |
(4,095) |
|
$ |
175,771 |
|
|
Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
|
— |
|
|
83,831 |
|
|
6,860 |
|
|
— |
|
|
90,691 |
|
|
Fuel |
|
|
— |
|
|
11,410 |
|
|
1,408 |
|
|
— |
|
|
12,818 |
|
|
Depreciation and amortization |
|
|
59 |
|
|
11,360 |
|
|
1,485 |
|
|
— |
|
|
12,904 |
|
|
Repairs and maintenance |
|
|
— |
|
|
12,024 |
|
|
1,556 |
|
|
— |
|
|
13,580 |
|
|
Other operating |
|
|
— |
|
|
29,962 |
|
|
4,447 |
|
|
(3,489) |
|
|
30,920 |
|
|
Selling, general and administrative expenses |
|
|
407 |
|
|
11,964 |
|
|
1,060 |
|
|
(606) |
|
|
12,825 |
|
|
Loss on disposal of property and equipment |
|
|
— |
|
|
341 |
|
|
318 |
|
|
— |
|
|
659 |
|
|
Total operating expenses |
|
|
466 |
|
|
160,892 |
|
|
17,134 |
|
|
(4,095) |
|
|
174,397 |
|
|
Comprehensive Income (Loss) |
|
|
(466) |
|
|
5,869 |
|
|
(4,029) |
|
|
— |
|
|
1,374 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Expense (Income) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense (income), net |
|
|
11,560 |
|
|
(132) |
|
|
110 |
|
|
— |
|
|
11,538 |
|
|
Other, net |
|
|
— |
|
|
2 |
|
|
(2,808) |
|
|
— |
|
|
(2,806) |
|
|
Equity in loss (income) of consolidated subsidiaries |
|
|
(4,413) |
|
|
1,332 |
|
|
— |
|
|
3,081 |
|
|
— |
|
|
Income (Loss) Before Income Taxes |
|
|
(7,613) |
|
|
4,667 |
|
|
(1,331) |
|
|
(3,081) |
|
|
(7,358) |
|
|
Provision for Income Taxes |
|
|
— |
|
|
254 |
|
|
1 |
|
|
— |
|
|
255 |
|
|
Net Income (Loss) |
|
|
(7,613) |
|
|
4,413 |
|
|
(1,332) |
|
|
(3,081) |
|
|
(7,613) |
|
|
Equity in other comprehensive loss of consolidated subsidiaries |
|
|
(1,970) |
|
|
(1,991) |
|
|
— |
|
|
3,961 |
|
|
— |
|
|
Other comprehensive income (loss), net of tax |
|
|
— |
|
|
21 |
|
|
(1,991) |
|
|
— |
|
|
(1,970) |
|
|
Comprehensive Income (Loss) |
|
$ |
(9,583) |
|
$ |
2,443 |
|
$ |
(3,323) |
|
$ |
880 |
|
$ |
(9,583) |
|
|
|
|
As of March 31, 2017 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
|
|
Condensed Consolidating Balance Sheet: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
— |
|
$ |
17,882 |
|
$ |
5,025 |
|
$ |
— |
|
$ |
22,907 |
|
|
Accounts receivable, net of allowance |
|
|
— |
|
|
47,769 |
|
|
1,057 |
|
|
(292) |
|
|
48,534 |
|
|
Prepaid expenses |
|
|
265 |
|
|
16,549 |
|
|
747 |
|
|
— |
|
|
17,561 |
|
|
Assets held for sale |
|
|
— |
|
|
71 |
|
|
51 |
|
|
— |
|
|
122 |
|
|
Total current assets |
|
|
265 |
|
|
82,271 |
|
|
6,880 |
|
|
(292) |
|
|
89,124 |
|
|
Restricted cash |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Investment in affiliates |
|
|
(21,570) |
|
|
(17,691) |
|
|
— |
|
|
39,261 |
|
|
— |
|
|
Property and equipment, net |
|
|
2,831 |
|
|
98,130 |
|
|
5,387 |
|
|
— |
|
|
106,348 |
|
|
Goodwill |
|
|
— |
|
|
30,980 |
|
|
1,171 |
|
|
— |
|
|
32,151 |
|
|
Intangibles, net |
|
|
— |
|
|
25,358 |
|
|
521 |
|
|
— |
|
|
25,879 |
|
|
Deposits and other assets |
|
|
477 |
|
|
30,403 |
|
|
316 |
|
|
— |
|
|
31,196 |
|
|
Intercompany receivables |
|
|
216,859 |
|
|
94,754 |
|
|
— |
|
|
(311,613) |
|
|
— |
|
|
Total assets |
|
$ |
198,862 |
|
$ |
344,325 |
|
$ |
14,275 |
|
$ |
(272,644) |
|
$ |
284,818 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit Facility |
|
$ |
69,764 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
69,764 |
|
|
Current maturities of long-term debt |
|
|
56 |
|
|
1,670 |
|
|
— |
|
|
— |
|
|
1,726 |
|
|
Accounts payable |
|
|
56 |
|
|
21,447 |
|
|
1,357 |
|
|
(288) |
|
|
22,572 |
|
|
Accrued wages and vacation payable |
|
|
— |
|
|
20,393 |
|
|
1,771 |
|
|
— |
|
|
22,164 |
|
|
Other accrued liabilities |
|
|
13,235 |
|
|
13,937 |
|
|
1,280 |
|
|
— |
|
|
28,452 |
|
|
Total current liabilities |
|
|
83,111 |
|
|
57,447 |
|
|
4,408 |
|
|
(288) |
|
|
144,678 |
|
|
Other liabilities |
|
|
— |
|
|
7,047 |
|
|
343 |
|
|
— |
|
|
7,390 |
|
|
Long-term debt, less current maturities |
|
|
473,121 |
|
|
4,702 |
|
|
— |
|
|
— |
|
|
477,823 |
|
|
Pension liability |
|
|
— |
|
|
2,195 |
|
|
— |
|
|
— |
|
|
2,195 |
|
|
Deferred income taxes |
|
|
— |
|
|
10,034 |
|
|
68 |
|
|
— |
|
|
10,102 |
|
|
Intercompany payables |
|
|
— |
|
|
284,470 |
|
|
27,147 |
|
|
(311,617) |
|
|
— |
|
|
Total liabilities |
|
|
556,232 |
|
|
365,895 |
|
|
31,966 |
|
|
(311,905) |
|
|
642,188 |
|
|
Stockholders' Deficit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' deficit |
|
|
(357,370) |
|
|
(21,570) |
|
|
(17,691) |
|
|
39,261 |
|
|
(357,370) |
|
|
Commitments and Contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders' deficit |
|
$ |
198,862 |
|
$ |
344,325 |
|
$ |
14,275 |
|
$ |
(272,644) |
|
$ |
284,818 |
|
|
|
|
As of December 31, 2016 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
||
|
Condensed Consolidating Balance Sheet: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
— |
|
$ |
14,199 |
|
$ |
3,735 |
|
$ |
— |
|
$ |
17,934 |
|
|
Accounts receivable, net of allowance |
|
|
— |
|
|
45,466 |
|
|
— |
|
|
(325) |
|
|
45,141 |
|
|
Prepaid expenses |
|
|
184 |
|
|
15,529 |
|
|
591 |
|
|
— |
|
|
16,304 |
|
|
Assets held for sale |
|
|
— |
|
|
71 |
|
|
55 |
|
|
— |
|
|
126 |
|
|
Total current assets |
|
|
184 |
|
|
75,265 |
|
|
4,381 |
|
|
(325) |
|
|
79,505 |
|
|
Restricted cash |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Investment in affiliates |
|
|
(27,857) |
|
|
(18,390) |
|
|
— |
|
|
46,247 |
|
|
— |
|
|
Property and equipment, net |
|
|
2,885 |
|
|
102,285 |
|
|
5,857 |
|
|
— |
|
|
111,027 |
|
|
Goodwill |
|
|
— |
|
|
30,980 |
|
|
1,058 |
|
|
— |
|
|
32,038 |
|
|
Intangibles, net |
|
|
— |
|
|
25,827 |
|
|
517 |
|
|
— |
|
|
26,344 |
|
|
Deposits and other assets |
|
|
572 |
|
|
29,123 |
|
|
383 |
|
|
— |
|
|
30,078 |
|
|
Intercompany receivables |
|
|
222,832 |
|
|
84,026 |
|
|
— |
|
|
(306,858) |
|
|
— |
|
|
Total assets |
|
$ |
198,616 |
|
$ |
329,236 |
|
$ |
12,196 |
|
$ |
(260,936) |
|
$ |
279,112 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit Facility |
|
$ |
71,039 |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
71,039 |
|
|
Current maturities of long-term debt |
|
|
56 |
|
|
1,849 |
|
|
— |
|
|
— |
|
|
1,905 |
|
|
Accounts payable |
|
|
60 |
|
|
21,577 |
|
|
1,167 |
|
|
(38) |
|
|
22,766 |
|
|
Accrued wages and vacation payable |
|
|
— |
|
|
15,760 |
|
|
2,362 |
|
|
(255) |
|
|
17,867 |
|
|
Other accrued liabilities |
|
|
4,686 |
|
|
12,472 |
|
|
864 |
|
|
— |
|
|
18,022 |
|
|
Total current liabilities |
|
|
75,841 |
|
|
51,658 |
|
|
4,393 |
|
|
(293) |
|
|
131,599 |
|
|
Other liabilities |
|
|
— |
|
|
6,836 |
|
|
679 |
|
|
— |
|
|
7,515 |
|
|
Long-term debt, less current maturities |
|
|
472,628 |
|
|
5,056 |
|
|
— |
|
|
— |
|
|
477,684 |
|
|
Pension liability |
|
|
— |
|
|
2,198 |
|
|
— |
|
|
— |
|
|
2,198 |
|
|
Deferred income taxes |
|
|
— |
|
|
9,908 |
|
|
61 |
|
|
— |
|
|
9,969 |
|
|
Intercompany payables |
|
|
— |
|
|
281,437 |
|
|
25,453 |
|
|
(306,890) |
|
|
— |
|
|
Total liabilities |
|
|
548,469 |
|
|
357,093 |
|
|
30,586 |
|
|
(307,183) |
|
|
628,965 |
|
|
Stockholders' Deficit |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' deficit |
|
|
(349,853) |
|
|
(27,857) |
|
|
(18,390) |
|
|
46,247 |
|
|
(349,853) |
|
|
Commitments and Contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders' deficit |
|
$ |
198,616 |
|
$ |
329,236 |
|
$ |
12,196 |
|
$ |
(260,936) |
|
$ |
279,112 |
|
|
|
|
Three Months Ended March 31, 2017 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
||
|
Condensed Consolidating Statements of Cash Flows: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
$ |
1,503 |
|
$ |
9,046 |
|
$ |
1,097 |
|
$ |
— |
|
$ |
11,646 |
|
|
Investing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale of property and equipment |
|
|
— |
|
|
175 |
|
|
76 |
|
|
— |
|
|
251 |
|
|
Purchases of property and equipment |
|
|
— |
|
|
(4,562) |
|
|
(46) |
|
|
— |
|
|
(4,608) |
|
|
Net cash provided by (used in) investing activities |
|
|
— |
|
|
(4,387) |
|
|
30 |
|
|
— |
|
|
(4,357) |
|
|
Financing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments on revolving Credit Facility |
|
|
(1,275) |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,275) |
|
|
Principal payments on long-term debt and other liabilities |
|
|
(13) |
|
|
(976) |
|
|
— |
|
|
— |
|
|
(989) |
|
|
Deferred financing costs |
|
|
(215) |
|
|
— |
|
|
— |
|
|
— |
|
|
(215) |
|
|
Net cash used in financing activities |
|
|
(1,503) |
|
|
(976) |
|
|
— |
|
|
— |
|
|
(2,479) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate change on cash |
|
|
— |
|
|
— |
|
|
163 |
|
|
— |
|
|
163 |
|
|
Increase in Cash, Cash Equivalents and Restricted Cash |
|
|
— |
|
|
3,683 |
|
|
1,290 |
|
|
— |
|
|
4,973 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
|
— |
|
|
14,319 |
|
|
3,735 |
|
|
— |
|
|
18,054 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
18,002 |
|
$ |
5,025 |
|
$ |
— |
|
$ |
23,027 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Cash, and Cash Equivalents and Restricted Cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period |
|
|
— |
|
|
14,199 |
|
|
3,735 |
|
|
— |
|
|
17,934 |
|
|
Restricted cash, beginning of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
$ |
— |
|
$ |
14,319 |
|
$ |
3,735 |
|
$ |
— |
|
$ |
18,054 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
|
— |
|
|
17,882 |
|
|
5,025 |
|
|
— |
|
|
22,907 |
|
|
Restricted cash, end of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
18,002 |
|
$ |
5,025 |
|
$ |
— |
|
$ |
23,027 |
|
|
|
|
Three Months Ended March 31, 2016 |
|
|||||||||||||
|
(in thousands) |
|
|
|
|
|
|
Non- |
|
|
|
|
|
|
|
||
|
Condensed Consolidating Statements of Cash Flows: |
|
Parent |
|
Guarantors |
|
Guarantors |
|
Eliminations |
|
Consolidated |
|
|||||
|
Operating Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities |
|
$ |
(7,526) |
|
$ |
7,359 |
|
$ |
1,699 |
|
$ |
218 |
|
$ |
1,750 |
|
|
Investing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from sale of property and equipment |
|
|
— |
|
|
1 |
|
|
6 |
|
|
— |
|
|
7 |
|
|
Purchases of property and equipment |
|
|
(213) |
|
|
(5,910) |
|
|
(61) |
|
|
— |
|
|
(6,184) |
|
|
Intercompany receivables |
|
|
— |
|
|
— |
|
|
(687) |
|
|
687 |
|
|
— |
|
|
Net cash used in investing activities |
|
|
(213) |
|
|
(5,909) |
|
|
(742) |
|
|
687 |
|
|
(6,177) |
|
|
Financing Activities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings under Credit Facility |
|
|
38,906 |
|
|
— |
|
|
— |
|
|
— |
|
|
38,906 |
|
|
Payments on revolving Credit Facility |
|
|
(31,154) |
|
|
— |
|
|
— |
|
|
— |
|
|
(31,154) |
|
|
Principal payments on long-term debt and other liabilities |
|
|
(13) |
|
|
(1,923) |
|
|
— |
|
|
— |
|
|
(1,936) |
|
|
Intercompany payables |
|
|
— |
|
|
687 |
|
|
— |
|
|
(687) |
|
|
— |
|
|
Net cash provided by (used in) financing activities |
|
|
7,739 |
|
|
(1,236) |
|
|
— |
|
|
(687) |
|
|
5,816 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate change on cash |
|
|
— |
|
|
— |
|
|
121 |
|
|
— |
|
|
121 |
|
|
Increase in Cash, Cash Equivalents and Restricted Cash |
|
|
— |
|
|
214 |
|
|
1,078 |
|
|
218 |
|
|
1,510 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
|
— |
|
|
120 |
|
|
2,789 |
|
|
(218) |
|
|
2,691 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
334 |
|
$ |
3,867 |
|
$ |
— |
|
$ |
4,201 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Cash, and Cash Equivalents and Restricted Cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period |
|
|
— |
|
|
— |
|
|
2,789 |
|
|
(218) |
|
|
2,571 |
|
|
Restricted cash, beginning of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, Beginning of Period |
|
$ |
— |
|
$ |
120 |
|
$ |
2,789 |
|
$ |
(218) |
|
$ |
2,691 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
|
— |
|
|
214 |
|
|
3,867 |
|
|
— |
|
|
4,081 |
|
|
Restricted cash, end of period |
|
|
— |
|
|
120 |
|
|
— |
|
|
— |
|
|
120 |
|
|
Cash, Cash Equivalents and Restricted Cash, End of Period |
|
$ |
— |
|
$ |
334 |
|
$ |
3,867 |
|
$ |
— |
|
$ |
4,201 |
|
|
|
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