V2X, INC., 10-Q filed on 5/7/2024
Quarterly Report
v3.24.1.u1
Cover - shares
 3 Months Ended
Mar. 29, 2024
Apr. 30, 2024
Cover [Abstract]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Mar. 29, 2024  
Document Transition Report false  
Entity File Number 001-36341  
Entity Registrant Name V2X, Inc.  
Entity Incorporation, State or Country Code IN  
Entity Tax Identification Number 38-3924636  
Entity Address, Address Line One 7901 Jones Branch Drive, Suite 700,  
Entity Address, City or Town McLean  
Entity Address, State or Province VA  
Entity Address, Postal Zip Code 22102  
City Area Code (571)  
Local Phone Number 481-2000  
Title of 12(b) Security Common Stock, Par Value $0.01 Per Share  
Trading Symbol VVX  
Security Exchange Name NYSE  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   31,459,020
Amendment Flag false  
Document Fiscal Year Focus 2024  
Document Fiscal Period Focus Q1  
Entity Central Index Key 0001601548  
Current Fiscal Year End Date --12-31  
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Condensed Consolidated Statements of Income (Loss) (Unaudited) - USD ($)
shares in Thousands, $ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Income Statement [Abstract]    
Revenue $ 1,010,564 $ 943,460
Cost of revenue 940,290 864,630
Selling, general, and administrative expenses 39,943 48,251
Operating income 30,331 30,579
Loss on extinguishment of debt 0 (22,052)
Interest expense, net (27,574) (31,744)
Other expense, net (1,633) 0
Income (loss) from operations before income taxes 1,124 (23,217)
Income tax benefit (20) (5,737)
Net income (loss) $ 1,144 $ (17,480)
Earnings (loss) per share    
Basic (in dollars per share) $ 0.04 $ (0.57)
Diluted (in dollars per share) $ 0.04 $ (0.57)
Weighted average common shares outstanding - basic (in shares) 31,351 30,927
Weighted average common shares outstanding - basic (in shares) 31,794 30,927
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Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Statement of Comprehensive Income [Abstract]    
Net income (loss) $ 1,144 $ (17,480)
Changes in derivative instruments:    
Net change in fair value of interest rate swaps 4,921 (2,347)
Tax benefit 430 148
Net change in derivative instruments 5,351 (2,199)
Foreign currency translation adjustments, net of tax (2,843) 1,806
Other comprehensive income (loss), net of tax 2,508 (393)
Total comprehensive income (loss) $ 3,652 $ (17,873)
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Condensed Consolidated Balance Sheets (Unaudited) - USD ($)
$ in Thousands
Mar. 29, 2024
Dec. 31, 2023
Current assets    
Cash, cash equivalents and restricted cash $ 35,658 $ 72,651
Receivables 788,490 705,995
Prepaid expenses and other current assets 129,427 96,223
Total current assets 953,575 874,869
Property, plant, and equipment, net 93,362 85,429
Goodwill 1,648,298 1,656,926
Intangible assets, net 389,448 407,530
Right-of-use assets 37,629 41,215
Other non-current assets 17,379 15,931
Total non-current assets 2,186,116 2,207,031
Total Assets 3,139,691 3,081,900
Current liabilities    
Accounts payable 430,600 453,052
Compensation and other employee benefits 139,349 158,088
Short-term debt 15,361 15,361
Other accrued liabilities 267,425 213,700
Total current liabilities 852,735 840,201
Long-term debt, net 1,154,345 1,100,269
Deferred tax liabilities 13,698 11,763
Operating lease liabilities 32,419 34,691
Other non-current liabilities 92,758 104,176
Total non-current liabilities 1,293,220 1,250,899
Total liabilities 2,145,955 2,091,100
Commitments and contingencies (Note 7)
Shareholders' Equity    
Preferred stock; $0.01 par value; 10,000,000 shares authorized; No shares issued and outstanding 0 0
Common stock; $0.01 par value; 100,000,000 shares authorized; 31,452,806 and 31,191,628 shares issued and outstanding as of March 29, 2024 and December 31, 2023, respectively 315 312
Additional paid in capital 761,605 762,324
Retained earnings 231,995 230,851
Accumulated other comprehensive loss (179) (2,687)
Total shareholders' equity 993,736 990,800
Total Liabilities and Shareholders' Equity $ 3,139,691 $ 3,081,900
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Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares
Mar. 29, 2024
Dec. 31, 2023
Shareholders' Equity    
Preferred stock, par value (in dollars per share) $ 0.01 $ 0.01
Preferred stock, shares authorized (in shares) 10,000,000 10,000,000
Preferred stock, shares issued (in shares) 0 0
Preferred stock, shares outstanding (in shares) 0 0
Common stock, par value (in dollars per share) $ 0.01 $ 0.01
Common stock, shares authorized (in shares) 100,000,000 100,000,000
Common stock, shares issued (in shares) 31,452,806 31,191,628
Common stock, shares outstanding (in shares) 31,452,806 31,191,628
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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Operating activities    
Net income (loss) $ 1,144 $ (17,480)
Adjustments to reconcile net income (loss) to net cash used in operating activities:    
Depreciation expense 6,243 5,412
Amortization of intangible assets 22,539 22,606
Loss on disposal of property, plant, and equipment 8 31
Stock-based compensation 5,149 12,872
Deferred taxes (262) (6,034)
Amortization of debt issuance costs 2,160 2,513
Loss on extinguishment of debt 0 22,052
Changes in assets and liabilities:    
Receivables (55,363) (30,649)
Other assets (23,522) (9,778)
Accounts payable (33,715) (4,115)
Compensation and other employee benefits (18,607) (24,182)
Other liabilities 37,000 (11,740)
Net cash used in operating activities (57,226) (38,492)
Investing activities    
Purchases of capital assets (7,775) (9,076)
Proceeds from the disposition of assets 5 0
Acquisitions of businesses (16,939) 0
Net cash used in investing activities (24,709) (9,076)
Financing activities    
Proceeds from issuance of long-term debt 0 250,000
Repayments of long-term debt (3,840) (421,013)
Proceeds from revolver 375,250 348,750
Repayments of revolver (319,250) (163,750)
Proceeds from stock awards and stock options 3 5
Payment of debt issuance costs 0 (7,507)
Prepayment premium on early redemption of debt 0 (1,600)
Payments of employee withholding taxes on share-based compensation (5,702) (12,806)
Net cash provided by (used in) financing activities 46,461 (7,921)
Exchange rate effect on cash (1,519) 1,567
Net change in cash, cash equivalents and restricted cash (36,993) (53,922)
Cash, cash equivalents and restricted cash - beginning of period 72,651 116,067
Cash, cash equivalents and restricted cash - end of period 35,658 62,145
Supplemental disclosure of cash flow information:    
Interest paid 27,125 29,066
Income taxes paid 1,014 300
Purchase of capital assets on account $ 410 $ 494
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Condensed Consolidated Statements of Changes to Shareholders' Equity (Unaudited) - USD ($)
shares in Thousands, $ in Thousands
Total
Common Stock Issued
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive (Loss) Income
Balance (in shares) at Dec. 31, 2022   30,470      
Balance at Dec. 31, 2022 $ 997,079 $ 305 $ 748,877 $ 253,424 $ (5,527)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Net income (loss) (17,480)     (17,480)  
Foreign currency translation adjustments 1,806       1,806
Unrealized gain (loss) on cash flow hedge (2,199)       (2,199)
Employee stock awards and stock options (in shares)   535      
Employee stock awards and stock options 5 $ 5      
Taxes withheld on stock compensation awards (12,806)   (12,806)    
Stock-based compensation 12,066   12,066    
Balance (in shares) at Mar. 31, 2023   31,005      
Balance at Mar. 31, 2023 978,471 $ 310 748,137 235,944 (5,920)
Balance (in shares) at Dec. 31, 2023   31,192      
Balance at Dec. 31, 2023 990,800 $ 312 762,324 230,851 (2,687)
Increase (Decrease) in Stockholders' Equity [Roll Forward]          
Net income (loss) 1,144     1,144  
Foreign currency translation adjustments (2,843)       (2,843)
Unrealized gain (loss) on cash flow hedge 5,351       5,351
Employee stock awards and stock options (in shares)   261      
Employee stock awards and stock options 3 $ 3      
Taxes withheld on stock compensation awards (5,702)   (5,702)    
Stock-based compensation 4,983   4,983    
Balance (in shares) at Mar. 29, 2024   31,453      
Balance at Mar. 29, 2024 $ 993,736 $ 315 $ 761,605 $ 231,995 $ (179)
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Description of Business and Summary of Significant Accounting Policies
 3 Months Ended
Mar. 29, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business and Summary of Significant Accounting Policies
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business
V2X, Inc., an Indiana Corporation, formerly known as Vectrus, Inc. (Vectrus), is a leading provider of critical mission solutions and support to defense clients globally. The Company operates as one segment and delivers a comprehensive suite of integrated solutions and critical service offerings across the operations and logistics, aerospace, training and technology markets to national security, defense, civilian and international clients.
Unless the context otherwise requires or unless stated otherwise, references in these notes to "V2X", "we," "us," "our," “combined company”, "the Company" and "our Company" refer to V2X, Inc. and all of its consolidated subsidiaries, taken together as a whole.
Equity Investments
In 2011, the Company entered into a joint venture agreement with Shaw Environmental & Infrastructure, Inc., which is now APTIM Federal Services LLC. Pursuant to the joint venture agreement, High Desert Support Services, LLC (HDSS) was established to pursue and perform work on the Ft. Irwin Installation Support Services Contract, which was awarded to HDSS in October 2012. In 2018, the Company entered into a joint venture agreement with J&J Maintenance. Pursuant to the joint venture agreement, J&J Facilities Support, LLC (J&J) was established to pursue and perform work on various U.S. government contracts. In 2020, the Company entered into a joint venture agreement with Kuwait Resources House for Human Resources Management and Services Company. Pursuant to the joint venture agreement, ServCore Resources and Services Solutions, LLC (ServCore) was established to operate and manage labor and life support services outside of the continental United States at designated locations serviced by V2X and others around the world.
The Company accounts for its investments in HDSS, J&J, and ServCore under the equity method and has the ability to exercise significant influence but does not hold a controlling interest. The Company's proportionate 25%, 50%, and 40% shares, respectively, of income or losses from HDSS, J&J, and ServCore are recorded in selling, general and administrative expenses in the Condensed Consolidated Statements of Income (Loss). The Company's investment in these joint ventures is recorded in other non-current assets in the Condensed Consolidated Balance Sheets.
When cash distributions are received by the Company from its equity method investments, the cash distribution is compared to cumulative earnings and cumulative cash distributions. Cash distributions received are recorded as a return on investment in operating cash flows within the Condensed Consolidated Statements of Cash Flows to the extent cumulative cash distributions are less than cumulative earnings. Any cash distributions in excess of cumulative earnings are recorded as a return of investment in investing cash flows within the Condensed Consolidated Statements of Cash Flows. As of March 29, 2024 and December 31, 2023, the Company's combined investment balance was $4.8 million and $5.4 million, respectively. The Company's proportionate share of income from equity method investments was $2.6 million and $1.8 million for the three months ended March 29, 2024 and March 31, 2023, respectively.
Basis of Presentation
The Company's quarterly financial periods end on the Friday closest to the last day of the calendar quarter (March 29, 2024 for the first quarter of 2024 and March 31, 2023 for the first quarter of 2023), except for the last quarter of the fiscal year, which ends on December 31. For ease of presentation, the quarterly financial statements included herein are described as three months ended.
The unaudited interim Condensed Consolidated Financial Statements of V2X have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the U.S. (GAAP) have been omitted. These unaudited interim Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023.
It is management’s opinion that these financial statements include all normal and recurring adjustments necessary for a fair presentation of the Company’s financial position and operating results. Revenue and net income for any interim period are not necessarily indicative of future or annual results.
Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no material impact on the results of operations, financial position, or changes in shareholders’ equity.
Restricted Cash
As of March 29, 2024, the Company had total cash, cash equivalents, and restricted cash of $35.7 million which included $2.1 million of restricted cash. The Company's restricted cash was $2.0 million as of December 31, 2023.
Related Party Transactions
During the three months ended March 29, 2024 and March 31, 2023, the Company recorded income of $0.5 million and $0.7 million, respectively, related to a Transition Services Agreement with Crestview Aerospace LLC (Crestview). The income was recorded as a reduction in cost of sales. Crestview is a subsidiary of American Industrial Partners Capital Fund VI, L.P. (AIP), an affiliate of the majority shareholder of the Company.
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Recent Accounting Standards Update
 3 Months Ended
Mar. 29, 2024
Accounting Standards Update and Change in Accounting Principle [Abstract]  
Recent Accounting Standards Update
RECENT ACCOUNTING STANDARDS UPDATE
In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2023-07, Segment Reporting (Topic 280), to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. Amongst other amendments, the standard requires annual and interim disclosures of significant segment expenses that are regularly provided to the chief operating decision maker (CODM), and interim disclosures about a reportable segment’s profit or loss and assets that are currently required annually. This standard does not change how an entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of adoption of this standard on its consolidated financial statements.
In December 2023, the FASB issued ASU No. 2023-09 Income Taxes (Topic 740) to improve income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The amendments in this ASU are effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of adoption of this standard on its consolidated financial statements.
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Revenue
 3 Months Ended
Mar. 29, 2024
Revenue from Contract with Customer [Abstract]  
Revenue
REVENUE
Remaining Performance Obligations
Remaining performance obligations represent firm orders by the customer and excludes potential orders under indefinite delivery and indefinite quantity (IDIQ) contracts, unexercised contract options and contracts awarded to us that are being protested by competitors with the U.S. Government Accountability Office (GAO) or in the U.S. Court of Federal Claims (COFC). The level of order activity related to programs can be affected by the timing of government funding authorizations and their project evaluation cycles. Year-over-year comparisons could, at times, be impacted by these factors, among others.
The Company's contracts are multi-year contracts and typically include an initial period of one year or less with annual one year (or less) option periods. The number of option periods varies by contract, and there is no guarantee that an option period will be exercised. The right to exercise an option period is at the sole discretion of the U.S. government when the Company is the prime contractor or of the prime contractor when the Company is a subcontractor. The Company expects to recognize a substantial portion of its performance obligations as revenue within the next 12 months. However, the U.S. government or the prime contractor may cancel any contract at any time through a termination for convenience or for cause. Substantially all the Company's contracts have terms that would permit recovery of all or a portion of the Company's incurred costs and fees for work performed in the event of a termination for convenience.
Remaining performance obligations are presented in the following table:
March 29,December 31,
(In millions)20242023
Performance Obligations$3,268 $3,629 
As of March 29, 2024, the Company expects to recognize approximately 63% and 37% of these remaining performance obligations as revenue in 2024 and 2025, respectively.
Contract Estimates
The impact of adjustments in contract estimates on the Company's operating income can be reflected in either revenue or cost of revenue. Cumulative adjustments for the three months ended March 29, 2024 and March 31, 2023 were favorable by $0.5 million and $13.1 million, respectively.
For the three months ended March 29, 2024 and March 31, 2023, the net adjustments to operating income increased revenue by $3.4 million and $13.9 million, respectively.
Revenue by Category
Generally, the sales price elements for the Company's contracts are cost-plus, cost-reimbursable, firm-fixed-price and time-and-materials, all of which are commonly identified with a single contract. On a cost-plus contract, the Company is paid allowable incurred costs plus a profit, which can be fixed or variable depending on the contract’s fee arrangement, up to funding levels predetermined by the Company's customers.
On cost-plus contracts, the Company does not bear the risks of unexpected cost overruns, provided that incurred costs do not exceed the predetermined funded amounts. Most of the Company's cost-plus contracts also contain a firm-fixed-price element. Cost-plus contracts with award and incentive fee provisions are primarily variable contract fee arrangements. Award fees provide for a fee based on actual performance relative to contractually specified performance criteria. Incentive fees are based on the relationship between total allowable and target cost.
Most of the Company's contracts include a cost-reimbursable element to capture costs of consumable materials required for the program. Typically, these costs do not bear fees.
On a firm-fixed-price contract, the Company agrees to perform the contractual statement of work for a predetermined contract price. A firm-fixed-price contract typically offers higher profit margin potential than a cost-plus contract, which is commensurate with the greater levels of risk assumed on a firm-fixed-price contract. Although a firm-fixed-price contract generally permits retention of profits if the total actual contract costs are less than the estimated contract costs, the Company bears the risk that increased or unexpected costs may reduce profit or cause the Company to sustain losses on the contract. Although the overall scope of work required under the contract may not change, profit may be adjusted as experience is gained and as efficiencies are realized or costs are incurred.
On a time-and-materials contract, the Company is reimbursed for labor at fixed hourly rates and generally reimbursed separately for allowable materials, costs and expenses at cost. For this contract type, the Company bears the risk that labor costs and allocable indirect expenses are greater than the fixed hourly rate defined within the contract.
The following tables present various revenue disaggregations.
Revenue by contract type is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
Cost-plus and cost-reimbursable$604,167 $523,030 15.5 %
Firm-fixed-price379,272 385,112 (1.5)%
Time-and-materials27,125 35,318 (23.2)%
Total revenue$1,010,564 $943,460 
Revenue by geographic region in which the contract is performed is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
United States$544,726 $548,770 (0.7)%
Middle East343,216 281,121 22.1 %
Asia68,802 64,317 7.0 %
Europe53,820 49,252 9.3 %
Total revenue$1,010,564 $943,460 
Revenue by contract relationship is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
Prime contractor$945,155 $879,179 7.5 %
Subcontractor65,409 64,281 1.8 %
Total revenue$1,010,564 $943,460 
Revenue by customer is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
Army$433,430 $390,503 11.0 %
Navy321,384 292,690 9.8 %
Air Force118,569 129,981 (8.8)%
Other137,181 130,286 5.3 %
Total revenue$1,010,564 $943,460 
Contract Balances
The timing of revenue recognition, billings, and cash collections results in billed and unbilled accounts receivable (contract assets) and customer advances and deposits (contract liabilities) on the Condensed Consolidated Balance Sheets. Amounts are billed as work progresses in accordance with agreed-upon contractual terms at periodic intervals (e.g., biweekly or monthly). Generally, billing occurs subsequent to revenue recognition, resulting in contract assets. However, the Company may receive advances or deposits from its customers before revenue is recognized, resulting in contract liabilities. These advance billings and payments are not considered significant financing components because they are frequently intended to ensure that both parties are in conformance with the primary contract terms. These assets and liabilities are reported on the Condensed Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period.
As of January 1, 2023, the Company had contract assets of $487.8 million. As of March 29, 2024 and December 31, 2023, the Company had contract assets of $658.9 million and $561.9 million, respectively. Contract assets primarily consist of unbilled receivables which represent rights to consideration for work completed but not billed as of the reporting date. The balance of unbilled receivables consists of costs and fees that are: (i) billable immediately; (ii) billable on contract completion; or (iii) billable upon other specified events, such as the resolution of a request for equitable adjustment. Refer to Note 4, Receivables for additional information regarding the composition of the Company's receivable balances. As of January 1, 2023, the Company had contract liabilities of $76.4 million. As of March 29, 2024 and December 31, 2023, contract liabilities, included in other accrued liabilities in the Condensed Consolidated Balance Sheets, were $142.0 million and $109.6 million, respectively.
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Receivables
 3 Months Ended
Mar. 29, 2024
Receivables [Abstract]  
Receivables
RECEIVABLES
Receivables were comprised of the following:
March 29,December 31,
(In thousands)20242023
Billed receivables$117,203 $109,318 
Unbilled receivables (contract assets)658,893 561,862 
Other 12,394 34,815 
Total receivables$788,490 $705,995 
As of March 29, 2024 and December 31, 2023, substantially all billed receivables are due from the U.S. government, either directly as prime contractor to the U.S. government or as subcontractor to another prime contractor to the U.S. government. Because the Company's billed receivables are with the U.S. government, the Company does not believe it has a material credit risk exposure.
Unbilled receivables are contract assets that represent revenue recognized on long-term contracts in excess of amounts billed as of the balance sheet date. The Company expects to bill customers for most of the March 29, 2024 contract assets during 2024. Changes in the balance of receivables are primarily due to the timing differences between performance and customers' payments.
SALE OF RECEIVABLES
The Company has a Master Accounts Receivable Purchase Agreement (MARPA Facility) with MUFG Bank, Ltd. (MUFG) for the sale of certain designated eligible receivables up to a maximum amount of $200.0 million with the U.S. government. Receivables sold under the MARPA Facility are without recourse for any U.S. government credit risk.
The Company accounts for these receivable transfers under the MARPA Facility as sales under ASC Topic 860, Transfers and Servicing, and removes the sold receivables from its balance sheet. The fair value of the sold receivables approximated their book value due to their short-term nature.
As of and for the
Three Months Ended
March 29,
(In thousands)2024
Beginning balance:$72,715 
Sale of receivables621,920 
Cash collections(588,266)
Outstanding balance sold to MUFG1
106,369 
    Cash collected, not remitted to MUFG2
(24,167)
Remaining sold receivables$82,202 
1 For the three months ended March 29, 2024, the Company recorded a net cash inflow from sale of receivables of $33.7 million from operating activities.
2 Includes the cash collected on behalf of, but not yet remitted to, MUFG as of March 29, 2024. This balance is included in other accrued liabilities as of the balance sheet date.
During the three months ended March 29, 2024, the Company incurred purchase discount fees, net of servicing fees, of $1.6 million, which are presented in other expense, net on the Condensed Consolidated Statements of Income (Loss) and are reflected as cash flows from operating activities on the Condensed Consolidated Statements of Cash Flows.
The Company does not retain an ongoing financial interest in the transferred receivables other than cash collection and administrative services. The Company estimated that its servicing fee was at fair value and therefore has not recognized a servicing asset or liability as of March 29, 2024. Proceeds from the sale of receivables are reflected as cash flows from operating activities on the Condensed Consolidated Statements of Cash Flows.
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Debt
 3 Months Ended
Mar. 29, 2024
Debt Disclosure [Abstract]  
Debt
DEBT
Senior Secured Credit Facilities
First Lien Credit Agreement
The First Lien Credit Agreement provides for a tranche of term loans in an aggregate original principal amount of $911.1 million. The loans under the First Lien Credit Agreement amortize in an amount equal to approximately $2.3 million per quarter through September 30, 2028, with the balance of $865.6 million due on December 6, 2028.
Vertex Aerospace Services LLC (Vertex Borrower) obligations under the First Lien Credit Agreement are guaranteed by Vertex Intermediate LLC and Vertex Borrower’s wholly-owned domestic subsidiaries (collectively, the Guarantors), subject to customary exceptions and limitations. The Vertex Borrower’s obligations under the First Lien Credit Agreement and the Guarantors’ obligations under the related guarantees are secured by a first priority-lien on substantially all the Vertex Borrower’s and the Guarantors’ assets which exists on a pari passu basis with the lien held by the 2023 Credit Agreement lenders.
The borrowings under the First Lien Credit Agreement bear interest at rates that, at the Vertex Borrower’s option, can be either a base rate, determined by reference to the greater of (a) the federal funds rate plus 0.50%, (b) the prime lending rate, or (c) an adjusted Secured Overnight Financing Rate (SOFR) rate plus 1.00%, plus a margin of 2.25% per annum, or SOFR, plus a margin of 3.25% per annum. As of March 29, 2024, the effective interest rate for the First Lien Credit Agreement was 9.48%.
The First Lien Credit Agreement contains customary representations and warranties and affirmative covenants. The First Lien Credit Agreement also includes negative covenants that limit, among other things, additional indebtedness, additional liens, sales of assets, dividends, investments and advances, prepayments of debt and mergers and acquisitions.
The First Lien Credit Agreement contains customary events of default, including, but not limited to, payment defaults, breaches of representations and warranties, covenant defaults, events of bankruptcy and insolvency, failure of any guaranty or security document supporting the First Lien Credit Agreement to be in full force and effect, and a change of control. If an event of default occurs and is continuing, the Vertex Borrower may be required immediately to repay all amounts outstanding under the First Lien Credit Agreement.
As of March 29, 2024, the carrying value of the First Lien Credit Agreement was $906.6 million, excluding deferred discount and unamortized deferred financing costs of $34.7 million. The estimated fair value of the First Lien Credit Agreement as of March 29, 2024 was $908.8 million. The fair value is based on observable inputs of interest rates that are currently available to us for debt with similar terms and maturities for non-public debt (Level 2).
2023 Credit Agreement
The 2023 Credit Agreement provides for $750.0 million in senior secured financing, with a first lien on substantially all the Vertex Borrower’s assets and consists of (a) a $500.0 million five-year revolving credit facility (2023 Revolver) (which includes (i) a $50.0 million sublimit of availability for letters of credit, and (ii) a $50.0 million sublimit for short-term borrowings on a swingline basis) and (b) a five-year $250.0 million term loan (2023 Term Loan).
The 2023 Term Loan amortizes at approximately $1.6 million per quarter for the fiscal quarters ending June 30, 2023 through March 31, 2025, increasing to $3.1 million per quarter for the fiscal quarters ending June 30, 2025 through December 31, 2027, with the balance of $203.1 million due on February 28, 2028.
The Vertex Borrower’s obligations under the 2023 Credit Agreement are guaranteed by the Guarantors, subject to customary exceptions and limitations. The Vertex Borrower’s obligations under the 2023 Credit Agreement and the Guarantors’ obligations under the related guarantees are secured by a first priority-lien on substantially all of the Vertex Borrower’s and the Guarantors’ assets (subject to customary exceptions and limitations) which exists on a pari passu basis with the lien held by the First Lien Credit Agreement lenders.
The borrowings under the 2023 Credit Agreement bear interest at rates that, at the Vertex Borrower’s option, can be either a base rate, determined by reference to the greater of (a) the federal funds rate plus 0.50%, (b) the prime lending rate, or (c) an adjusted SOFR rate plus 1.00%, plus a margin of 1.00% to 2.25% per annum, or SOFR, plus a margin of 2.00% to 3.25% per annum, in each case, depending on the consolidated total net leverage ratio of the Vertex Borrower and its subsidiaries. As of March 29, 2024, the effective interest rates for the 2023 Revolver and Term Loan were 9.14% and 8.38%, respectively.
Unutilized commitments under the 2023 Revolver are subject to a per annum fee ranging from 0.25% to 0.50% depending on the consolidated total net leverage ratio of the Vertex Borrower and its subsidiaries.
The Vertex Borrower is also required to pay a letter of credit fronting fee to each letter of credit issuer equal to 0.125% per annum of the amount available to be drawn under each such letter of credit (or such other amount as may be mutually agreed by the Vertex Borrowers and the applicable letter of credit issuer), as well as a fee to all lenders equal to the applicable margin to SOFR of revolving credit loans times the average daily amount available to be drawn under all outstanding letters of credit.
The 2023 Credit Agreement contains customary representations and warranties, which must be accurate for the Vertex Borrower to borrow under the 2023 Credit Agreement, and affirmative covenants. The 2023 Credit Agreement also includes negative covenants that limit, among other things, additional indebtedness, transactions with affiliates, additional liens, sales of assets, dividends, investments and advances, prepayments of debt, mergers and acquisitions.
The 2023 Credit Agreement contains financial covenants requiring (a) the consolidated total net leverage ratio not to exceed 5.00 to 1.00 for the reporting periods ending on or after June 30, 2023, and on or prior to June 30, 2024, with further step downs thereafter, and (b) the consolidated interest coverage ratio be at least 2.00 to 1.00 commencing with the reporting period ending on June 30, 2023.
The 2023 Credit Agreement contains customary events of default, including, but not limited to, payment defaults, breaches of representations and warranties, covenant defaults, events of bankruptcy and insolvency, failure of any guaranty or security document supporting the 2023 Credit Agreement to be in full force and effect, and a change of control. If an event of default occurs and is continuing, the Borrowers may be required immediately to repay all amounts outstanding under the 2023 Credit Agreement.
As of March 29, 2024, there were $56.0 million of outstanding borrowings and $17.2 million of outstanding letters of credit under the 2023 Revolver. Availability under the 2023 Revolver was $426.8 million as of March 29, 2024. Unamortized deferred financing costs related to the 2023 Revolver of $3.9 million are included in other non-current assets in the Condensed Consolidated Balance Sheets. As of March 29, 2024, the fair value of the 2023 Revolver approximated the carrying value because the debt bears a floating interest rate.
As of March 29, 2024, the carrying value of the 2023 Term Loan was $243.8 million, excluding unamortized deferred financing costs of $2.0 million. The estimated fair value of the 2023 Term Loan as of March 29, 2024 was $244.1 million. The fair value is based on observable inputs of interest rates that are currently available to us for debt with similar terms and maturities for non-public debt (Level 2).
The aggregate scheduled maturities of the First Lien Credit Agreement and 2023 Credit Agreement as of March 29, 2024 are as follows:
(In thousands)Payments due
2024 (remainder of the year)$11,521
202520,049
202621,611
202721,611
20281,131,527
Total$1,206,319
As of March 29, 2024, the Company was in compliance with all covenants related to the First Lien Credit Agreement and the 2023 Credit Agreement
v3.24.1.u1
Derivative Instruments
 3 Months Ended
Mar. 29, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments
DERIVATIVE INSTRUMENTS
During the periods covered by this report, the Company has made no changes to its policies or strategies for the use of derivative instruments and there has been no change in related accounting methods. For the Company's derivative instruments, which are designated as cash flow hedges, gains and losses are initially reported as a component of accumulated other comprehensive income (loss) and subsequently recognized in earnings with the corresponding hedged item.
Interest Rate Derivative Instruments
The Company is exposed to the risk that the earnings and cash flows could be adversely impacted due to fluctuations in interest rates. To mitigate this risk, the Company entered into $350.0 million of interest rate swap contracts during the first six months of 2023. As of March 29, 2024 and December 31, 2023, these contracts had notional values of $343.8 million and $345.3 million, respectively. These contracts are designated and qualify as effective cash flow hedges.
The following table summarizes the amount at fair value and location of the derivative instruments for interest rate hedges in the Condensed Consolidated Balance Sheets as of March 29, 2024:
(In thousands)Fair Value (level 2)
Balance sheet captionAmount
Interest rate swap designated as cash flow hedgePrepaid expenses and other current assets$4,095 
Interest rate swap designated as cash flow hedgeOther non-current assets$1,201 
Interest rate swap designated as cash flow hedgeAccumulated other comprehensive income$5,296 
The Company regularly assesses the creditworthiness of the counterparty. As of March 29, 2024, the counterparty to the interest rate swaps had performed in accordance with its contractual obligations. Both the counterparty credit risk and the Company's credit risk were considered in the fair value determination.
Net interest rate derivative gains of $1.5 million and a nominal amount were recognized in interest expense, net, in the Condensed Consolidated Statements of Income (Loss) during the three months ended March 29, 2024 and March 31, 2023, respectively. The Company expects $4.3 million of existing interest rate swap gains reported in accumulated other comprehensive income as of March 29, 2024 to be recognized in earnings within the next 12 months.
v3.24.1.u1
Commitments and Contingencies
 3 Months Ended
Mar. 29, 2024
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
COMMITMENTS AND CONTINGENCIES
General
From time to time, the Company is involved in various investigations, lawsuits, arbitrations, claims, enforcement actions and other legal proceedings, including government investigations and claims, which are incidental to the operation of its business. Some of these proceedings seek remedies relating to employment matters, matters relating to injuries to people or property damage, matters in connection with the Company's contracts and matters arising under laws relating to the protection of the environment. Additionally, U.S. government customers periodically advise the Company of claims and penalties concerning certain potential disallowed costs. When such findings are presented, V2X and the U.S. government representatives engage in discussions to enable V2X to evaluate the merits of these claims as well as to assess the amounts being claimed.
Where appropriate, provisions are made to reflect probable losses related to the matters raised by U.S. government representatives. Such assessments, along with any assessments regarding provisions for other legal proceedings, are reviewed on a quarterly basis for sufficiency based on the latest information available to us.
The Company estimated and accrued $12.4 million and $12.1 million as of March 29, 2024 and December 31, 2023, respectively, in other accrued liabilities in the Condensed Consolidated Balance Sheets for legal proceedings and for claims with respect to its U.S. government contracts as discussed below, including years where the U.S. government has not completed its incurred cost audits. Although the ultimate outcome of any legal matter or claim cannot be predicted with certainty, based on present information, including the assessment of the merits of a particular claim, the Company does not expect that any asserted or unasserted legal or contractual claims or proceedings, individually or in the aggregate, will have a material adverse effect on its cash flows, results of operations or financial condition.
U.S. Government Contracts, Investigations and Claims
The Company has U.S. government contracts that are funded incrementally on a year-to-year basis. Changes in government policies, priorities or funding levels through agency or program budget reductions by the U.S. Congress or executive agencies could have a material adverse effect on the Company's financial condition or results of operations. Furthermore, the Company's contracts with the U.S. government may be terminated or suspended by the U.S. government at any time, with or without cause. Such contract suspensions or terminations could result in non-reimbursable expenses or charges or otherwise adversely affecting the Company's financial condition and results of operations.
Departments and agencies of the U.S. government have the authority to investigate various transactions and operations of the Company, and the results of such investigations may lead to administrative, civil or criminal proceedings, the ultimate outcome of which could be fines, penalties, repayments or compensatory or treble damages. U.S. government regulations provide that certain findings against a contractor may lead to suspension or debarment from future U.S. government contracts or the loss of export privileges for a company or an operating division or subdivision. Suspension or debarment could have a material adverse effect on the Company because of its reliance on U.S. government contracts.
U.S. government agencies, including the Defense Contract Audit Agency, the Defense Contract Management Agency and others, routinely audit and review the Company's performance on government contracts, indirect rates and pricing practices, and compliance with applicable contracting and procurement laws, regulations and standards. Accordingly, costs billed or billable to U.S. government customers are subject to potential adjustment upon audit by such agencies. The U.S. government agencies also review the adequacy of compliance with government standards for business systems, including accounting, earned value management, estimating, materials management and accounting, purchasing, and property management systems. A finding by a U.S. government agency that the Company’s business systems are not adequate could adversely affect the Company’s financial condition and results of operations.
In the performance of its contracts, the Company routinely requests contract modifications that require additional funding from U.S. government customers. Most often, these requests are due to customer-directed changes in the scope of work. While the Company is entitled to recovery of these costs under its contracts, the administrative process with the U.S. government customer may be protracted. Based on the circumstances, the Company periodically files requests for equitable adjustments (REAs) that are sometimes converted into claims. In some cases, these requests are disputed by the U.S. government customer. The Company believes its outstanding modifications, REAs and other claims will be resolved without material adverse impact to its results of operations, financial condition or cash flows.
v3.24.1.u1
Stock-Based Compensation
 3 Months Ended
Mar. 29, 2024
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation
STOCK-BASED COMPENSATION
The Company maintains an equity incentive plan, the 2014 Omnibus Incentive Plan, as amended and restated effective as of October 27, 2022 (the 2014 Omnibus Plan), to govern awards granted to V2X employees and directors, including nonqualified stock options (NQOs), restricted stock units (RSUs), total shareholder return (TSR) awards, performance share units (PSUs) and other awards. The Company accounts for NQOs, stock-settled RSUs and PSUs as equity-based compensation awards. TSR awards, described below, are accounted for as liability-based compensation awards. Liability-based awards are revalued at the end of each reporting period to reflect changes in fair value.
Stock-based compensation expense and the associated tax benefits impacting the Company's Condensed Consolidated Statements of Income (Loss) were as follows:
Three Months Ended
March 29,March 31,
(In thousands)20242023
Compensation costs for equity-based awards$4,983 $12,066 
Compensation costs for liability-based awards166 806 
Total compensation costs, pre-tax$5,149 $12,872 
Future tax benefit$1,065 $2,971 
As of March 29, 2024, total unrecognized compensation costs related to equity-based awards and liability-based awards were $26.6 million and $0.5 million, respectively, which are expected to be recognized ratably over a weighted average period of 1.85 years and 0.76 years, respectively.
The following table provides a summary of the activities for NQOs, RSUs and PSUs for the three months ended March 29, 2024:
NQOsRSUsPSUs
(In thousands, except per share data)SharesWeighted Average Exercise Price Per ShareSharesWeighted Average Grant Date Fair Value Per ShareSharesWeighted Average Grant Date Fair Value Per Share
Outstanding at January 1, 202440 $22.93 800 $37.29 267 $43.45 
Granted— $— 251 $44.92 96 $44.92 
Exercised— $— (397)$42.15 — $— 
Vested— $— — $— — $— 
Forfeited or expired— $— (29)$39.83 (34)$39.45 
Outstanding at March 29, 202440 $22.93 625 $40.86 329 $41.88 
Restricted Stock Units
RSUs awarded to employees vest in one-third increments on each of the three anniversary dates following the grant date subject to continued employment as described in the RSU award agreement. RSUs issued to directors are typically granted annually and vest approximately one year after the grant date. The fair value of each RSU grant was determined based on the closing price of V2X common stock on the date of grant. Stock compensation expense will be recognized ratably over the requisite service period of the RSU awards.
As of March 29, 2024, there was $18.5 million of unrecognized RSU related compensation expense.
Total Shareholder Return Awards
TSR awards are performance-based cash awards that are subject to a three-year performance period. Any payments earned are made in cash following completion of the performance period according to the achievement of specified performance goals. There were no cash-based TSR awards granted in the first quarter of 2024. As of March 29, 2024, there was $0.5 million of unrecognized TSR related compensation expense.
Performance Share Units
During the first quarter of 2024, the Company granted performance-based awards with market conditions. The awards will vest and the stock will be issued at the end of a three-year period based on the attainment of certain total shareholder return performance measures as compared to peer group companies, and the employee's continued service through the vesting date. The number of shares ultimately awarded, if any, can range up to 200% of the specified target awards. If performance is below the threshold level of performance, no shares will be issued.
As of March 29, 2024, there was $8.1 million of unrecognized PSU related compensation expense.
v3.24.1.u1
Income Taxes
 3 Months Ended
Mar. 29, 2024
Income Tax Disclosure [Abstract]  
Income Taxes
INCOME TAXES
Effective Tax Rate
Income tax expense during interim periods is based on an estimated annual effective income tax rate, plus discrete items that may occur in any given interim periods. The computation of the estimated effective income tax rate at each interim period requires certain estimates and judgment including, but not limited to, forecasted operating income for the year, projections of the income earned and taxed in various jurisdictions, newly enacted tax rate and legislative changes, permanent and temporary differences, and the likelihood of recovering deferred tax assets generated in the current year.
For the three months ended March 29, 2024 and March 31, 2023, the Company recorded income tax benefits which were not material and $5.7 million, respectively. The Company's effective income tax rates for the three months ended March 29, 2024 and March 31, 2023 were (1.8)% and 24.7%, respectively. The effective income tax rates vary from the federal statutory rate of 21.0% mainly due to state and foreign taxes, disallowed compensation deduction under Internal Revenue Code Section 162(m), offset by available deductions not reflected in book income and income tax credits.
Uncertain Tax Positions
As of March 29, 2024 and December 31, 2023, unrecognized tax benefits from uncertain tax positions were $6.6 million and $6.6 million, respectively.
v3.24.1.u1
Earnings Per Share
 3 Months Ended
Mar. 29, 2024
Earnings Per Share [Abstract]  
Earnings Per Share
EARNINGS PER SHARE
Basic earnings per share (EPS) is computed by dividing net income, or loss, by the weighted average number of common shares outstanding for the period. Diluted EPS reflects potential dilution that could occur if securities to issue common stock were exercised or converted into common stock. Diluted EPS includes the dilutive effect of stock-based compensation outstanding after application of the treasury stock method.
Three Months Ended
March 29,March 31,
(In thousands, except per share data)20242023
Net income (loss)$1,144 $(17,480)
Weighted average common shares outstanding31,351 30,927 
Add: Dilutive impact of stock options18 — 
Add: Dilutive impact of restricted stock units425 — 
Diluted weighted average common shares outstanding31,794 30,927 
Earnings (loss) per share
Basic$0.04 $(0.57)
Diluted$0.04 $(0.57)
The following table summarizes the weighted average of anti-dilutive securities excluded from the diluted EPS calculation.
Three Months Ended
March 29,March 31,
(In thousands)20242023
Anti-dilutive stock options— — 
Anti-dilutive restricted stock units25 — 
Total25 — 
v3.24.1.u1
Post-Employment Benefit Plans
 3 Months Ended
Mar. 29, 2024
Retirement Benefits [Abstract]  
Post-Employment Benefit Plans
POST-EMPLOYMENT BENEFIT PLANS
Deferred Employee Compensation
The Company sponsors two non-qualified deferred compensation plans. Under these plans, participants are eligible to defer a portion of their compensation on a tax deferred basis. Plan investments and obligations were recorded in other non-current assets and other non-current liabilities, respectively, in the Condensed Consolidated Balance Sheets, representing the fair value related to the deferred compensation plans. Adjustments to the fair value of the plan investments and obligations are recorded in selling, general, and administrative expenses. The plans assets and liabilities were $4.2 million and $3.2 million as of March 29, 2024 and December 31, 2023, respectively.
Multi-Employer Pension Plans
Certain Company employees who perform work on contracts within the continental United States participate in multi-employer pension plans of which the Company is not the sponsor. Company expenses related to these plans were $5.0 million and $3.3 million for the three months ended March 29, 2024 and March 31, 2023, respectively.
v3.24.1.u1
Sale of Receivables
 3 Months Ended
Mar. 29, 2024
Receivables [Abstract]  
Sale of Receivables
RECEIVABLES
Receivables were comprised of the following:
March 29,December 31,
(In thousands)20242023
Billed receivables$117,203 $109,318 
Unbilled receivables (contract assets)658,893 561,862 
Other 12,394 34,815 
Total receivables$788,490 $705,995 
As of March 29, 2024 and December 31, 2023, substantially all billed receivables are due from the U.S. government, either directly as prime contractor to the U.S. government or as subcontractor to another prime contractor to the U.S. government. Because the Company's billed receivables are with the U.S. government, the Company does not believe it has a material credit risk exposure.
Unbilled receivables are contract assets that represent revenue recognized on long-term contracts in excess of amounts billed as of the balance sheet date. The Company expects to bill customers for most of the March 29, 2024 contract assets during 2024. Changes in the balance of receivables are primarily due to the timing differences between performance and customers' payments.
SALE OF RECEIVABLES
The Company has a Master Accounts Receivable Purchase Agreement (MARPA Facility) with MUFG Bank, Ltd. (MUFG) for the sale of certain designated eligible receivables up to a maximum amount of $200.0 million with the U.S. government. Receivables sold under the MARPA Facility are without recourse for any U.S. government credit risk.
The Company accounts for these receivable transfers under the MARPA Facility as sales under ASC Topic 860, Transfers and Servicing, and removes the sold receivables from its balance sheet. The fair value of the sold receivables approximated their book value due to their short-term nature.
As of and for the
Three Months Ended
March 29,
(In thousands)2024
Beginning balance:$72,715 
Sale of receivables621,920 
Cash collections(588,266)
Outstanding balance sold to MUFG1
106,369 
    Cash collected, not remitted to MUFG2
(24,167)
Remaining sold receivables$82,202 
1 For the three months ended March 29, 2024, the Company recorded a net cash inflow from sale of receivables of $33.7 million from operating activities.
2 Includes the cash collected on behalf of, but not yet remitted to, MUFG as of March 29, 2024. This balance is included in other accrued liabilities as of the balance sheet date.
During the three months ended March 29, 2024, the Company incurred purchase discount fees, net of servicing fees, of $1.6 million, which are presented in other expense, net on the Condensed Consolidated Statements of Income (Loss) and are reflected as cash flows from operating activities on the Condensed Consolidated Statements of Cash Flows.
The Company does not retain an ongoing financial interest in the transferred receivables other than cash collection and administrative services. The Company estimated that its servicing fee was at fair value and therefore has not recognized a servicing asset or liability as of March 29, 2024. Proceeds from the sale of receivables are reflected as cash flows from operating activities on the Condensed Consolidated Statements of Cash Flows.
v3.24.1.u1
Description of Business and Summary of Significant Accounting Policies (Policies)
 3 Months Ended
Mar. 29, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Our Business and Basis of Presentation
Business
V2X, Inc., an Indiana Corporation, formerly known as Vectrus, Inc. (Vectrus), is a leading provider of critical mission solutions and support to defense clients globally. The Company operates as one segment and delivers a comprehensive suite of integrated solutions and critical service offerings across the operations and logistics, aerospace, training and technology markets to national security, defense, civilian and international clients.
Unless the context otherwise requires or unless stated otherwise, references in these notes to "V2X", "we," "us," "our," “combined company”, "the Company" and "our Company" refer to V2X, Inc. and all of its consolidated subsidiaries, taken together as a whole.
Basis of Presentation
The Company's quarterly financial periods end on the Friday closest to the last day of the calendar quarter (March 29, 2024 for the first quarter of 2024 and March 31, 2023 for the first quarter of 2023), except for the last quarter of the fiscal year, which ends on December 31. For ease of presentation, the quarterly financial statements included herein are described as three months ended.
The unaudited interim Condensed Consolidated Financial Statements of V2X have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the U.S. (GAAP) have been omitted. These unaudited interim Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023.
It is management’s opinion that these financial statements include all normal and recurring adjustments necessary for a fair presentation of the Company’s financial position and operating results. Revenue and net income for any interim period are not necessarily indicative of future or annual results.
Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no material impact on the results of operations, financial position, or changes in shareholders’ equity.
Equity Investments
Equity Investments
In 2011, the Company entered into a joint venture agreement with Shaw Environmental & Infrastructure, Inc., which is now APTIM Federal Services LLC. Pursuant to the joint venture agreement, High Desert Support Services, LLC (HDSS) was established to pursue and perform work on the Ft. Irwin Installation Support Services Contract, which was awarded to HDSS in October 2012. In 2018, the Company entered into a joint venture agreement with J&J Maintenance. Pursuant to the joint venture agreement, J&J Facilities Support, LLC (J&J) was established to pursue and perform work on various U.S. government contracts. In 2020, the Company entered into a joint venture agreement with Kuwait Resources House for Human Resources Management and Services Company. Pursuant to the joint venture agreement, ServCore Resources and Services Solutions, LLC (ServCore) was established to operate and manage labor and life support services outside of the continental United States at designated locations serviced by V2X and others around the world.
The Company accounts for its investments in HDSS, J&J, and ServCore under the equity method and has the ability to exercise significant influence but does not hold a controlling interest. The Company's proportionate 25%, 50%, and 40% shares, respectively, of income or losses from HDSS, J&J, and ServCore are recorded in selling, general and administrative expenses in the Condensed Consolidated Statements of Income (Loss). The Company's investment in these joint ventures is recorded in other non-current assets in the Condensed Consolidated Balance Sheets.
When cash distributions are received by the Company from its equity method investments, the cash distribution is compared to cumulative earnings and cumulative cash distributions. Cash distributions received are recorded as a return on investment in operating cash flows within the Condensed Consolidated Statements of Cash Flows to the extent cumulative cash distributions are less than cumulative earnings. Any cash distributions in excess of cumulative earnings are recorded as a return of investment in investing cash flows within the Condensed Consolidated Statements of Cash Flows. As of March 29, 2024 and December 31, 2023, the Company's combined investment balance was $4.8 million and $5.4 million, respectively. The Company's proportionate share of income from equity method investments was $2.6 million and $1.8 million for the three months ended March 29, 2024 and March 31, 2023, respectively.
v3.24.1.u1
Revenue (Tables)
 3 Months Ended
Mar. 29, 2024
Revenue from Contract with Customer [Abstract]  
Remaining Performance Obligation
Remaining performance obligations are presented in the following table:
March 29,December 31,
(In millions)20242023
Performance Obligations$3,268 $3,629 
Disaggregation of Revenue
The following tables present various revenue disaggregations.
Revenue by contract type is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
Cost-plus and cost-reimbursable$604,167 $523,030 15.5 %
Firm-fixed-price379,272 385,112 (1.5)%
Time-and-materials27,125 35,318 (23.2)%
Total revenue$1,010,564 $943,460 
Revenue by geographic region in which the contract is performed is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
United States$544,726 $548,770 (0.7)%
Middle East343,216 281,121 22.1 %
Asia68,802 64,317 7.0 %
Europe53,820 49,252 9.3 %
Total revenue$1,010,564 $943,460 
Revenue by contract relationship is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
Prime contractor$945,155 $879,179 7.5 %
Subcontractor65,409 64,281 1.8 %
Total revenue$1,010,564 $943,460 
Revenue by customer is as follows:
Three Months Ended
March 29,March 31,%
(In thousands)20242023Change
Army$433,430 $390,503 11.0 %
Navy321,384 292,690 9.8 %
Air Force118,569 129,981 (8.8)%
Other137,181 130,286 5.3 %
Total revenue$1,010,564 $943,460 
v3.24.1.u1
Receivables (Tables)
 3 Months Ended
Mar. 29, 2024
Receivables [Abstract]  
Schedule of Receivables
Receivables were comprised of the following:
March 29,December 31,
(In thousands)20242023
Billed receivables$117,203 $109,318 
Unbilled receivables (contract assets)658,893 561,862 
Other 12,394 34,815 
Total receivables$788,490 $705,995 
v3.24.1.u1
Debt (Tables)
 3 Months Ended
Mar. 29, 2024
Debt Disclosure [Abstract]  
Schedule of Maturities of Long-term Debt
The aggregate scheduled maturities of the First Lien Credit Agreement and 2023 Credit Agreement as of March 29, 2024 are as follows:
(In thousands)Payments due
2024 (remainder of the year)$11,521
202520,049
202621,611
202721,611
20281,131,527
Total$1,206,319
v3.24.1.u1
Derivative Instruments (Tables)
 3 Months Ended
Mar. 29, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Derivative Liabilities at Fair Value
The following table summarizes the amount at fair value and location of the derivative instruments for interest rate hedges in the Condensed Consolidated Balance Sheets as of March 29, 2024:
(In thousands)Fair Value (level 2)
Balance sheet captionAmount
Interest rate swap designated as cash flow hedgePrepaid expenses and other current assets$4,095 
Interest rate swap designated as cash flow hedgeOther non-current assets$1,201 
Interest rate swap designated as cash flow hedgeAccumulated other comprehensive income$5,296 
v3.24.1.u1
Stock-Based Compensation (Tables)
 3 Months Ended
Mar. 29, 2024
Share-Based Payment Arrangement [Abstract]  
Schedule of Impact of Stock-Based Compensation in Consolidation and Combined Statements of Income
Stock-based compensation expense and the associated tax benefits impacting the Company's Condensed Consolidated Statements of Income (Loss) were as follows:
Three Months Ended
March 29,March 31,
(In thousands)20242023
Compensation costs for equity-based awards$4,983 $12,066 
Compensation costs for liability-based awards166 806 
Total compensation costs, pre-tax$5,149 $12,872 
Future tax benefit$1,065 $2,971 
Schedule of Non-Qualified Stock Options, Activity
The following table provides a summary of the activities for NQOs, RSUs and PSUs for the three months ended March 29, 2024:
NQOsRSUsPSUs
(In thousands, except per share data)SharesWeighted Average Exercise Price Per ShareSharesWeighted Average Grant Date Fair Value Per ShareSharesWeighted Average Grant Date Fair Value Per Share
Outstanding at January 1, 202440 $22.93 800 $37.29 267 $43.45 
Granted— $— 251 $44.92 96 $44.92 
Exercised— $— (397)$42.15 — $— 
Vested— $— — $— — $— 
Forfeited or expired— $— (29)$39.83 (34)$39.45 
Outstanding at March 29, 202440 $22.93 625 $40.86 329 $41.88 
v3.24.1.u1
Earnings Per Share (Tables)
 3 Months Ended
Mar. 29, 2024
Earnings Per Share [Abstract]  
Reconciliation of Basic and Diluted Weighted Average Shares Outstanding
Three Months Ended
March 29,March 31,
(In thousands, except per share data)20242023
Net income (loss)$1,144 $(17,480)
Weighted average common shares outstanding31,351 30,927 
Add: Dilutive impact of stock options18 — 
Add: Dilutive impact of restricted stock units425 — 
Diluted weighted average common shares outstanding31,794 30,927 
Earnings (loss) per share
Basic$0.04 $(0.57)
Diluted$0.04 $(0.57)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share
The following table summarizes the weighted average of anti-dilutive securities excluded from the diluted EPS calculation.
Three Months Ended
March 29,March 31,
(In thousands)20242023
Anti-dilutive stock options— — 
Anti-dilutive restricted stock units25 — 
Total25 — 
v3.24.1.u1
Sale of Receivables (Tables)
 3 Months Ended
Mar. 29, 2024
Receivables [Abstract]  
Schedule of Receivables Sold The fair value of the sold receivables approximated their book value due to their short-term nature.
As of and for the
Three Months Ended
March 29,
(In thousands)2024
Beginning balance:$72,715 
Sale of receivables621,920 
Cash collections(588,266)
Outstanding balance sold to MUFG1
106,369 
    Cash collected, not remitted to MUFG2
(24,167)
Remaining sold receivables$82,202 
1 For the three months ended March 29, 2024, the Company recorded a net cash inflow from sale of receivables of $33.7 million from operating activities.
2 Includes the cash collected on behalf of, but not yet remitted to, MUFG as of March 29, 2024. This balance is included in other accrued liabilities as of the balance sheet date.
v3.24.1.u1
Description of Business and Summary of Significant Accounting Policies (Details)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
USD ($)
operatingSegment
Mar. 31, 2023
USD ($)
Dec. 31, 2023
USD ($)
Dec. 31, 2022
USD ($)
Schedule of Equity Method Investments [Line Items]        
Number of operating segments | operatingSegment 1      
Joint venture investment balance $ 4,800   $ 5,400  
Proportionate share of income (loss) 2,600 $ 1,800    
Cash, cash equivalents and restricted cash 35,658 62,145 72,651 $ 116,067
Restricted cash 2,100   $ 2,000  
Net income (loss) 1,144 (17,480)    
Related Party        
Schedule of Equity Method Investments [Line Items]        
Net income (loss) $ 500 $ 700    
High Desert Support Services, LLC        
Schedule of Equity Method Investments [Line Items]        
Ownership percentage 25.00%      
J&J Maintenance        
Schedule of Equity Method Investments [Line Items]        
Ownership percentage 50.00%      
Servcore Resources and Services Solutions, LLC        
Schedule of Equity Method Investments [Line Items]        
Ownership percentage 40.00%      
v3.24.1.u1
Revenue - Revenue Performance Obligations (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Dec. 31, 2023
Revenue from Contract with Customer [Abstract]    
Contract term 1 year  
Renewal option, term 1 year  
Performance Obligations $ 3,268,000 $ 3,629,000
v3.24.1.u1
Revenue - Revenue Performance Obligations (Percentage and Remaining Period of Time) (Details)
Mar. 29, 2024
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-03-30  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]  
Revenue, remaining performance obligation, percentage 63.00%
Revenue, expected performance obligation, period 9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01  
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]  
Revenue, remaining performance obligation, percentage 37.00%
Revenue, expected performance obligation, period 1 year
v3.24.1.u1
Revenue - Revenue Contract Estimates (Details) - USD ($)
$ in Millions
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Revenue from Contract with Customer [Abstract]    
Favorable adjustments to operating income $ 0.5 $ 13.1
Favorable adjustments to revenue $ 3.4 $ 13.9
v3.24.1.u1
Revenue - Revenue by Contract Type (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Disaggregation of Revenue [Line Items]    
Total revenue $ 1,010,564 $ 943,460
Cost-plus and cost-reimbursable    
Disaggregation of Revenue [Line Items]    
Total revenue $ 604,167 523,030
Revenue, percent change 15.50%  
Firm-fixed-price    
Disaggregation of Revenue [Line Items]    
Total revenue $ 379,272 385,112
Revenue, percent change (1.50%)  
Time-and-materials    
Disaggregation of Revenue [Line Items]    
Total revenue $ 27,125 $ 35,318
Revenue, percent change (23.20%)  
v3.24.1.u1
Revenue - Revenue by Geographic Region (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Disaggregation of Revenue [Line Items]    
Total revenue $ 1,010,564 $ 943,460
United States    
Disaggregation of Revenue [Line Items]    
Total revenue $ 544,726 548,770
Revenue, percent change (0.70%)  
Middle East    
Disaggregation of Revenue [Line Items]    
Total revenue $ 343,216 281,121
Revenue, percent change 22.10%  
Asia    
Disaggregation of Revenue [Line Items]    
Total revenue $ 68,802 64,317
Revenue, percent change 7.00%  
Europe    
Disaggregation of Revenue [Line Items]    
Total revenue $ 53,820 $ 49,252
Revenue, percent change 9.30%  
v3.24.1.u1
Revenue - Revenue by Contract Relationship (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Disaggregation of Revenue [Line Items]    
Total revenue $ 1,010,564 $ 943,460
Prime contractor    
Disaggregation of Revenue [Line Items]    
Total revenue $ 945,155 879,179
Revenue, percent change 7.50%  
Subcontractor    
Disaggregation of Revenue [Line Items]    
Total revenue $ 65,409 $ 64,281
Revenue, percent change 1.80%  
v3.24.1.u1
Revenue - Revenue by Customer (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Disaggregation of Revenue [Line Items]    
Total revenue $ 1,010,564 $ 943,460
Army    
Disaggregation of Revenue [Line Items]    
Total revenue $ 433,430 390,503
Revenue, percent change 11.00%  
Navy    
Disaggregation of Revenue [Line Items]    
Total revenue $ 118,569 129,981
Revenue, percent change (8.80%)  
Air Force    
Disaggregation of Revenue [Line Items]    
Total revenue $ 321,384 292,690
Revenue, percent change 9.80%  
Other    
Disaggregation of Revenue [Line Items]    
Total revenue $ 137,181 $ 130,286
Revenue, percent change 5.30%  
v3.24.1.u1
Revenue - Revenue Contract Balances (Details) - USD ($)
$ in Millions
Mar. 29, 2024
Dec. 31, 2023
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]      
Contract assets $ 658.9 $ 561.9 $ 487.8
Contract liabilities $ 142.0 $ 109.6 $ 76.4
v3.24.1.u1
Receivables - Schedule of Receivables (Details) - USD ($)
$ in Thousands
Mar. 29, 2024
Dec. 31, 2023
Receivables [Abstract]    
Billed receivables $ 117,203 $ 109,318
Unbilled receivables (contract assets) 658,893 561,862
Other 12,394 34,815
Total receivables $ 788,490 $ 705,995
v3.24.1.u1
Debt - Additional Information (Details) - USD ($)
$ in Thousands
 3 Months Ended
Feb. 28, 2023
Jul. 05, 2022
Mar. 29, 2024
Mar. 31, 2023
Debt Instrument [Line Items]        
Prepayment premium on early redemption of debt     $ 0 $ 1,600
Letters of credit | 2023 Credit Agreement        
Debt Instrument [Line Items]        
Outstanding borrowings     $ 17,200  
Secured Debt | First Lien Initial Term Tranche        
Debt Instrument [Line Items]        
Interest rate     9.48%  
Secured Debt | Vertex First Lien Credit Agreement        
Debt Instrument [Line Items]        
Total     $ 906,600  
Deferred debt issuance costs     (34,700)  
Fair value     908,800  
Quarterly amortization   $ 2,300    
Secured Debt | Vertex First Lien Term Facility        
Debt Instrument [Line Items]        
Face amount   865,600    
Secured Debt | New Term Loans        
Debt Instrument [Line Items]        
Face amount   $ 911,100    
Secured Debt | Fed Funds Effective Rate Overnight Index Swap Rate | First Lien Initial Term Tranche        
Debt Instrument [Line Items]        
Spread on variable rate   0.50%    
Secured Debt | Eurodollar | First Lien Initial Term Tranche        
Debt Instrument [Line Items]        
Spread on variable rate   2.25%    
Secured Debt | Secured Overnight Financing Rate | First Lien Initial Term Tranche        
Debt Instrument [Line Items]        
Spread on variable rate 1.00% 1.00%    
Secured Debt | Secured Overnight Financing Rate | Maximum | First Lien Initial Term Tranche        
Debt Instrument [Line Items]        
Spread on variable rate   3.25%    
Line of Credit | 2023 Credit Agreement        
Debt Instrument [Line Items]        
Outstanding borrowings     56,000  
Deferred debt issuance costs     (3,900)  
Remaining borrowing capacity     426,800  
Covenant terms, ratio of total indebtedness to combined EBITDA 5.00      
Covenant terms, ratio of EBITDA to interest expense, net, 2.00      
Senior secured credit facilities        
Debt Instrument [Line Items]        
Credit facility, maximum borrowing capacity $ 750,000      
Senior secured credit facilities | Minimum        
Debt Instrument [Line Items]        
Quarterly amortization 1,600      
Senior secured credit facilities | Maximum        
Debt Instrument [Line Items]        
Quarterly amortization $ 3,100      
Senior secured credit facilities | Secured Debt | Fed Funds Effective Rate Overnight Index Swap Rate        
Debt Instrument [Line Items]        
Spread on variable rate 0.50%      
Senior secured credit facilities | Secured Debt | Eurodollar | Minimum        
Debt Instrument [Line Items]        
Spread on variable rate 1.00%      
Senior secured credit facilities | Secured Debt | Eurodollar | Maximum        
Debt Instrument [Line Items]        
Spread on variable rate 2.25%      
Senior secured credit facilities | Secured Debt | Secured Overnight Financing Rate | Minimum        
Debt Instrument [Line Items]        
Spread on variable rate 2.00%      
Senior secured credit facilities | Secured Debt | Secured Overnight Financing Rate | Maximum        
Debt Instrument [Line Items]        
Spread on variable rate 3.25%      
Term facility        
Debt Instrument [Line Items]        
Face amount $ 203,100      
Credit facility, maximum borrowing capacity 250,000      
Term facility | 2023 Credit Agreement        
Debt Instrument [Line Items]        
Face amount     $ 243,800  
Interest rate     8.38%  
Deferred debt issuance costs     $ 2,000  
Fair value     244,100  
Term facility | Short-term debt        
Debt Instrument [Line Items]        
Credit facility, maximum borrowing capacity 50,000      
Term Facility And Amended Revolver        
Debt Instrument [Line Items]        
Total     $ 1,206,319  
Revolver        
Debt Instrument [Line Items]        
Outstanding borrowings $ 500,000      
Debt instrument, term 5 years      
Revolver | 2023 Credit Agreement        
Debt Instrument [Line Items]        
Interest rate     9.14%  
Revolver | Letters of credit        
Debt Instrument [Line Items]        
Credit facility, maximum borrowing capacity $ 50,000      
Revolver | Line of Credit | Vertex ABL Credit Agreement        
Debt Instrument [Line Items]        
Fronting fee 0.125%      
Revolver | Line of Credit | Minimum | 2023 Credit Agreement | Equal To Or Less Than 50%        
Debt Instrument [Line Items]        
Commitment fee percentage 0.25%      
Revolver | Line of Credit | Maximum | 2023 Credit Agreement | Equal To Or Less Than 50%        
Debt Instrument [Line Items]        
Commitment fee percentage 0.50%      
v3.24.1.u1
Debt - Schedule of Maturities (Details) - Term Facility And Amended Revolver
$ in Thousands
Mar. 29, 2024
USD ($)
Payments due  
2024 (remainder of the year) $ 11,521
2025 20,049
2026 21,611
2027 21,611
2028 1,131,527
Total $ 1,206,319
v3.24.1.u1
Derivative Instruments - Additional Information (Details) - Cash Flow Hedging - Interest Rate Swap - USD ($)
$ in Millions
 3 Months Ended 6 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Jun. 30, 2023
Dec. 31, 2023
Derivative [Line Items]        
Derivative contracts entered into during period     $ 350.0  
Derivative, notional amount $ 343.8     $ 345.3
Designated as hedging instrument        
Derivative [Line Items]        
Gain (loss) on derivative instruments, net, pretax 1.5 $ 0.0    
Gains reclassified to earnings within the next 12 months $ 4.3      
v3.24.1.u1
Derivative Instruments - Interest Rate Hedges in the Condensed Consolidated Balance Sheets (Details) - Cash Flow Hedging - Designated as hedging instrument - Interest Rate Swap
$ in Thousands
Mar. 29, 2024
USD ($)
Prepaid expenses and other current assets  
Derivative [Line Items]  
Interest rate swap designated as cash flow hedge, liability $ 4,095
Other non-current assets  
Derivative [Line Items]  
Interest rate swap designated as cash flow hedge, liability 1,201
Accumulated Other Comprehensive (Loss) Income  
Derivative [Line Items]  
Interest rate swap designated as cash flow hedge, liability $ 5,296
v3.24.1.u1
Commitments and Contingencies (Details) - USD ($)
$ in Millions
Mar. 29, 2024
Dec. 31, 2023
Contract compliance    
Loss Contingencies [Line Items]    
Contracts loss contingency accrual $ 12.4 $ 12.1
v3.24.1.u1
Stock-Based Compensation - Schedule of Impact of Stock-Based Compensation in Condensed Consolidated Statements of Income (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Compensation cost for awards $ 5,149 $ 12,872
Future tax benefit 1,065 2,971
Compensation costs for equity-based awards    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Compensation cost for awards 4,983 12,066
Compensation costs for liability-based awards    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Compensation cost for awards $ 166 $ 806
v3.24.1.u1
Stock-Based Compensation - Additional Information (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Millions
 3 Months Ended
Jul. 05, 2022
Mar. 29, 2024
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Percentage of shareholder return award target   200.00%
Share-Based Payment Arrangement, Nonemployee    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Vesting period 1 year  
Total Shareholder Return Awards (TSR)    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Unrecognized compensation costs   $ 0.5
Vesting period   3 years
RSUs    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Unrecognized compensation costs   $ 18.5
Granted (in shares)   251
Granted (in dollars per share)   $ 44.92
RSUs | Share-Based Payment Arrangement, Employee | Share-based Compensation Award, Tranche One    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Vesting increments   33.33%
RSUs | Share-Based Payment Arrangement, Employee | Share-based Compensation Award, Tranche Two    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Vesting increments   33.33%
RSUs | Share-Based Payment Arrangement, Employee | Share-based Compensation Award, Tranche Three    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Vesting increments   33.33%
PSUs    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Unrecognized compensation costs   $ 8.1
Granted (in shares)   96
Granted (in dollars per share)   $ 44.92
Vesting period   3 years
Equity Based Awards    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Unrecognized compensation costs   $ 26.6
Unrecognized compensation costs, period for recognition   1 year 10 months 6 days
Liability Based Awards    
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Unrecognized compensation costs   $ 0.5
Unrecognized compensation costs, period for recognition   9 months 3 days
v3.24.1.u1
Stock-Based Compensation - Schedule of Non-Qualified Stock Options, Activity (Details)
shares in Thousands
 3 Months Ended
Mar. 29, 2024
$ / shares
shares
NQOs  
NQOs, Shares  
Outstanding at beginning of period (in shares) | shares 40
Outstanding at end of period (in shares) | shares 40
NQOs, Weighted Average Exercise Price Per Share  
Outstanding at beginning of period (in dollars per share) | $ / shares $ 22.93
Outstanding at end of period (in dollars per share) | $ / shares $ 22.93
RSUs  
NQOs, Shares  
Exercised (in shares) | shares (397)
Exercised (in dollars per share) | $ / shares $ 42.15
RSUs, Shares  
Outstanding at beginning of period (in shares) | shares 800
Granted (in shares) | shares 251
Forfeited or expired (in shares) | shares (29)
Outstanding at end of period (in shares) | shares 625
RSUs, Weighted Average Grant Date Fair Value  
Outstanding at beginning of period (in dollars per share) | $ / shares $ 37.29
Granted (in dollars per share) | $ / shares 44.92
Forfeited or expired (in dollars per share) | $ / shares 39.83
Outstanding at beginning of period (in dollars per share) | $ / shares $ 40.86
PSUs  
RSUs, Shares  
Outstanding at beginning of period (in shares) | shares 267
Granted (in shares) | shares 96
Forfeited or expired (in shares) | shares (34)
Outstanding at end of period (in shares) | shares 329
RSUs, Weighted Average Grant Date Fair Value  
Outstanding at beginning of period (in dollars per share) | $ / shares $ 43.45
Granted (in dollars per share) | $ / shares 44.92
Forfeited or expired (in dollars per share) | $ / shares 39.45
Outstanding at beginning of period (in dollars per share) | $ / shares $ 41.88
v3.24.1.u1
Income Taxes (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Dec. 31, 2023
Income Tax Disclosure [Abstract]      
Income tax benefit $ 20 $ 5,737  
Effective income tax rate (1.80%) 24.70%  
Unrecognized tax benefits $ 6,600   $ 6,600
v3.24.1.u1
Earnings Per Share - Reconciliation of Basic and Diluted Weighted Average Shares Outstanding (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Earnings Per Share [Abstract]    
Net income (loss) $ 1,144 $ (17,480)
Weighted average common shares outstanding (in shares) 31,351 30,927
Add: Dilutive impact of stock options (in shares) 18 0
Add: Dilutive impact of restricted stock units (in shares) 425 0
Diluted weighted average common shares outstanding (in shares) 31,794 30,927
Earnings (loss) per share    
Basic (in dollars per share) $ 0.04 $ (0.57)
Diluted (in dollars per share) $ 0.04 $ (0.57)
v3.24.1.u1
Earnings Per Share - Anti-dilutive Options (Details) - shares
shares in Thousands
 3 Months Ended
Mar. 29, 2024
Mar. 31, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti-dilutive stock options (in shares) 25 0
Anti-dilutive stock options    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti-dilutive stock options (in shares) 0 0
Anti-dilutive restricted stock units    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Anti-dilutive stock options (in shares) 25 0
v3.24.1.u1
Post-Employment Benefit Plans (Details)
$ in Millions
 3 Months Ended
Mar. 29, 2024
USD ($)
plan
Mar. 31, 2023
USD ($)
Dec. 31, 2023
USD ($)
Retirement Benefits [Abstract]      
Number of compensation plans | plan 2    
Plan assets and liabilities $ 4.2   $ 3.2
Expense recognized $ 5.0 $ 3.3  
v3.24.1.u1
Sale of Receivables - Schedule of Receivables Sold (Details)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
USD ($)
Transfers of Financial Assets Accounted For As Sale [Roll Forward]  
Beginning balance $ 72,715
Sale of receivables 621,920
Cash collections (588,266)
Outstanding balance sold to MUFG 106,369
Cash collected, not remitted to MUFG (24,167)
Remaining sold receivables 82,202
Collections from operating activities $ 33,700
v3.24.1.u1
Sale of Receivables (Details) - USD ($)
$ in Thousands
 3 Months Ended
Mar. 29, 2024
Dec. 31, 2023
Sep. 28, 2023
Receivables [Abstract]      
Availability under receivables purchase agreement $ 82,202 $ 72,715 $ 200,000
Purchase discount fees $ 1,600