crete Pumping (US:BBCP)2020-01-14 22:01Financial Performance - For the twelve months ended October 31, 2019, the company reported a net loss of $32.5 million, a decrease of $60.9 million compared to net income of $28.4 million in the same period a year ago, primarily due to higher expenses related to the Business Combination[156]. - Revenue for the Successor period from December 6, 2018, through October 31, 2019, was $258.6 million, representing a 16.3% increase compared to $243.2 million in the Predecessor period for the year ended October 31, 2018[160]. - Gross profit for the Successor period was $115.1 million, with a gross margin of 44.5%, compared to a gross margin of 42.5% in the Predecessor period[155]. - U.K. Operations generated revenue of $44.0 million in the Successor period, a decrease of 2.5% compared to the previous year[160]. - Eco-Pan, the company's concrete waste management service, reported revenue of $27.8 million, reflecting a 6.8% increase year-over-year[160]. - U.S. Concrete Pumping segment revenue increased by 24.0% year-over-year to $203.7 million, driven by acquisitions and improved operations[161]. - Adjusted EBITDA for U.S. Concrete Pumping was $62.8 million, a 34.3% increase year-over-year, mainly due to the Capital acquisition and volume growth[176]. - Adjusted EBITDA for U.K. Operations declined by 6.3% to $15.7 million, primarily due to reduced revenue[177]. - The company reported a net loss of $22.6 million during the Predecessor Period (November 1, 2018, through December 5, 2018), with net cash provided by operating activities of $7.9 million[196]. - Net income for the corporate segment was $1,516,000 for the year ended October 31, 2019, compared to $510,000 for the predecessor period[208]. - The company reported a net cash used in investing activities of $375,100 thousand, primarily due to acquisitions, including $449,436 thousand for the CPH acquisition[241]. Expenses and Costs - General and administrative expenses increased to $91.9 million in the Successor period, reflecting costs associated with being a newly public company[156]. - The company incurred $8.1 million in transaction costs and $16.4 million in debt extinguishment costs, primarily related to the Business Combination[156]. - General and Administrative expenses increased to $96.9 million, representing 34.2% of revenue, largely due to higher amortization and legal costs[167]. - Interest expense increased to $36.5 million, up $15.1 million from the previous fiscal year, due to higher average debt and interest rates[170]. - The company incurred transaction expenses of $11,838,000 for the year ended October 31, 2019[208]. - The company paid $29,472 thousand in interest and $1,984 thousand in income taxes during the reporting period[245]. Assets and Liabilities - Total assets increased from $370.1 million as of October 31, 2018, to $871.4 million as of October 31, 2019, primarily due to the Business Combination and the Capital acquisition, which added $129.2 million in net assets[158]. - The company's goodwill increased significantly to $276.1 million from $74.7 million, reflecting a growth of approximately 269%[231]. - Total liabilities also rose to $522.6 million from $309.5 million, marking an increase of around 69%[231]. - The outstanding balance under the Term Loan Agreement was $402.1 million as of October 31, 2019, with compliance to all debt covenants[187]. - The outstanding balance under the ABL Credit Agreement as of October 31, 2019, was $23.6 million, with the company in compliance with all debt covenants[190]. Cash Flow - Net cash provided by operating activities during the Successor Period (December 6, 2018, through October 31, 2019) was $22.8 million, despite a net loss of $9.9 million[192]. - Net cash used in financing activities was $361.6 million for the Successor Period, with inflows from net borrowings of $402.1 million under the Term Loan Agreement and $23.3 million under the ABL Credit Agreement[195]. - Cash generated from operating activities typically reflects net income adjusted for non-cash expense items, indicating a low level of working capital investment due to daily customer payments[191]. Acquisitions - The acquisition of Capital Pumping in May 2019 contributed significantly to the revenue growth, with U.S. Concrete Pumping revenue increasing by 24.0% year-over-year[160]. - The Company acquired Capital Pumping LP for a purchase price of $129.2 million, funded by public offering proceeds and term loan borrowings[300]. - The net assets acquired from Capital Pumping included current assets of $748,000, intangible assets of $45.5 million, and property and equipment valued at $56.5 million, resulting in total net assets of $102.7 million[301]. - The Company paid a total consideration of $614.3 million for the CPH acquisition, which included cash and rollover equity[305]. - Net assets acquired from CPH included current assets of $49.1 million, intangible assets of $208.1 million, and property and equipment valued at $219.5 million, leading to total net assets of $366.4 million[305]. Goodwill and Impairment - The company performed a goodwill impairment analysis as of July 31, 2019, indicating no impairment, with fair values exceeding carrying values by approximately 4%[212]. - The Company recognized goodwill of $276.1 million as of October 31, 2019, which includes $185.8 million from U.S. Concrete Pumping and $40.6 million from U.K. Operations[328]. - The Company recorded an out of period adjustment related to sales tax accrual reduction of $3.4 million, impacting goodwill and liabilities[330]. Revenue Recognition and Accounting Standards - The company recognizes revenue when persuasive evidence of an arrangement exists, the service has been performed, the price is fixed or determinable, and collectability is reasonably assured[277]. - The company plans to adopt ASU 2014-09 for revenue recognition in the fiscal year ending October 31, 2020, evaluating its impact on consolidated financial statements[295]. - The company plans to adopt ASU 2016-02 on leases effective for the year ending October 31, 2022, and is currently evaluating its impact[298]. - The company has opted for an extended transition period for new accounting standards under the JOBS Act[291].