We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
The Keyw Holding Corp. | NASDAQ:KEYW | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 11.23 | 11.21 | 11.34 | 0 | 01:00:00 |
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
The KEYW Holding Corporation
|
(Exact name of registrant as specified in its charter)
|
Maryland
|
|
27-1594952
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
7740 Milestone Parkway, Suite 400
Hanover, Maryland
|
|
21076
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
¨
|
Accelerated filer
x
|
Non-accelerated filer
¨
|
Smaller reporting company
¨
|
|
Emerging growth company
¨
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
ASSETS
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
30,667
|
|
|
$
|
17,832
|
|
Accounts receivable, net
|
34,027
|
|
|
49,880
|
|
||
Unbilled receivables, net
|
55,490
|
|
|
37,785
|
|
||
Inventories, net
|
26,342
|
|
|
24,337
|
|
||
Prepaid expenses
|
3,456
|
|
|
2,266
|
|
||
Income tax receivable
|
213
|
|
|
210
|
|
||
Total current assets
|
150,195
|
|
|
132,310
|
|
||
|
|
|
|
||||
Property and equipment, net
|
26,524
|
|
|
36,141
|
|
||
Goodwill
|
455,197
|
|
|
455,197
|
|
||
Other intangibles, net
|
47,645
|
|
|
57,045
|
|
||
Other assets
|
4,018
|
|
|
2,913
|
|
||
TOTAL ASSETS
|
$
|
683,579
|
|
|
$
|
683,606
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
13,778
|
|
|
$
|
25,609
|
|
Accrued expenses
|
16,190
|
|
|
17,862
|
|
||
Accrued salaries and wages
|
32,227
|
|
|
29,341
|
|
||
Term loan – current portion, net of discount
|
—
|
|
|
6,750
|
|
||
Convertible senior notes – current portion, net of discount
|
21,780
|
|
|
—
|
|
||
Deferred revenue
|
3,465
|
|
|
6,090
|
|
||
Total current liabilities
|
87,440
|
|
|
85,652
|
|
||
|
|
|
|
|
|
||
Convertible senior notes – non-current portion, net of discount
|
—
|
|
|
138,998
|
|
||
Term loan – non-current portion, net of discount
|
273,649
|
|
|
120,627
|
|
||
Deferred tax liability, net
|
15,735
|
|
|
19,367
|
|
||
Other non-current liabilities
|
10,630
|
|
|
11,444
|
|
||
TOTAL LIABILITIES
|
387,454
|
|
|
376,088
|
|
||
Commitments and contingencies
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
|
|
||
Preferred stock, $0.001 par value; 5,000 shares authorized, none issued
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value; 100,000 shares authorized, 49,859 and 49,876 shares issued and outstanding
|
50
|
|
|
50
|
|
||
Additional paid-in capital
|
428,835
|
|
|
422,901
|
|
||
Accumulated deficit
|
(133,208
|
)
|
|
(115,433
|
)
|
||
Accumulated other comprehensive income
|
448
|
|
|
—
|
|
||
Total stockholders’ equity
|
296,125
|
|
|
307,518
|
|
||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
683,579
|
|
|
$
|
683,606
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue
|
$
|
126,690
|
|
|
$
|
122,394
|
|
|
$
|
380,572
|
|
|
$
|
314,708
|
|
Cost of revenue, excluding amortization
|
91,771
|
|
|
93,475
|
|
|
281,813
|
|
|
236,122
|
|
||||
Operating expenses
|
28,455
|
|
|
24,781
|
|
|
81,262
|
|
|
81,672
|
|
||||
Intangible amortization expense
|
2,721
|
|
|
3,604
|
|
|
9,399
|
|
|
8,858
|
|
||||
Operating income (loss)
|
3,743
|
|
|
534
|
|
|
8,098
|
|
|
(11,944
|
)
|
||||
Interest expense, net
|
6,240
|
|
|
4,829
|
|
|
16,974
|
|
|
12,352
|
|
||||
Loss on extinguishment of debt
|
166
|
|
|
—
|
|
|
11,595
|
|
|
—
|
|
||||
Other non-operating loss (income)
|
9
|
|
|
(246
|
)
|
|
(123
|
)
|
|
(375
|
)
|
||||
Loss before income taxes
|
(2,672
|
)
|
|
(4,049
|
)
|
|
(20,348
|
)
|
|
(23,921
|
)
|
||||
Income tax (benefit) expense, net
|
(686
|
)
|
|
1,980
|
|
|
(3,569
|
)
|
|
5,039
|
|
||||
Net loss
|
$
|
(1,986
|
)
|
|
$
|
(6,029
|
)
|
|
$
|
(16,779
|
)
|
|
$
|
(28,960
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
49,833
|
|
|
49,771
|
|
|
49,814
|
|
|
48,627
|
|
||||
Diluted
|
49,833
|
|
|
49,771
|
|
|
49,814
|
|
|
48,627
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Loss per share
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.60
|
)
|
Diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.60
|
)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net loss
|
$
|
(1,986
|
)
|
|
$
|
(6,029
|
)
|
|
$
|
(16,779
|
)
|
|
$
|
(28,960
|
)
|
Unrecognized gain on derivative instruments, net of taxes
|
448
|
|
|
—
|
|
|
448
|
|
|
—
|
|
||||
Comprehensive loss
|
$
|
(1,538
|
)
|
|
$
|
(6,029
|
)
|
|
$
|
(16,331
|
)
|
|
$
|
(28,960
|
)
|
|
Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated other comprehensive income
|
|
Total Stockholders’ Equity
|
|||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balance, December 31, 2017
|
49,876
|
|
|
$
|
50
|
|
|
$
|
422,901
|
|
|
$
|
(115,433
|
)
|
|
$
|
—
|
|
|
$
|
307,518
|
|
Cumulative effect of adopting ASC 606
|
—
|
|
|
—
|
|
|
—
|
|
|
(996
|
)
|
|
—
|
|
|
(996
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,779
|
)
|
|
—
|
|
|
(16,779
|
)
|
|||||
Other comprehensive income, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
448
|
|
|
448
|
|
|||||
Option exercise, net
|
66
|
|
|
—
|
|
|
346
|
|
|
—
|
|
|
—
|
|
|
346
|
|
|||||
Shares withheld for tax withholdings on vesting of restricted stock and exercising of options
|
(4
|
)
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
|||||
Share-based compensation
|
(79
|
)
|
|
—
|
|
|
3,501
|
|
|
—
|
|
|
—
|
|
|
3,501
|
|
|||||
Settlement of capped call transactions
|
—
|
|
|
—
|
|
|
2,118
|
|
|
—
|
|
|
|
|
2,118
|
|
||||||
Balance, September 30, 2018
|
49,859
|
|
|
$
|
50
|
|
|
$
|
428,835
|
|
|
$
|
(133,208
|
)
|
|
$
|
448
|
|
|
$
|
296,125
|
|
|
Nine months ended September 30,
|
||||||
|
2018
|
|
2017
|
||||
Net loss
|
$
|
(16,779
|
)
|
|
$
|
(28,960
|
)
|
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
|
|
|
|
|
||
Share-based compensation
|
3,501
|
|
|
3,054
|
|
||
Depreciation and amortization expense
|
18,178
|
|
|
16,371
|
|
||
Loss on extinguishment of debt
|
11,595
|
|
|
—
|
|
||
Non-cash interest expense
|
3,661
|
|
|
5,356
|
|
||
Loss on disposal of assets
|
3,185
|
|
|
—
|
|
||
Deferred taxes
|
(3,468
|
)
|
|
5,012
|
|
||
Changes in assets and liabilities, net of effects of acquisitions:
|
|
|
|
|
|
||
Accounts receivable, net
|
15,853
|
|
|
4,663
|
|
||
Unbilled receivables, net
|
(16,540
|
)
|
|
(2,334
|
)
|
||
Inventories, net
|
(2,297
|
)
|
|
(5,829
|
)
|
||
Prepaid expenses
|
(1,596
|
)
|
|
(219
|
)
|
||
Accounts payable
|
(11,831
|
)
|
|
3,949
|
|
||
Accrued expenses
|
(2,702
|
)
|
|
3,983
|
|
||
Other non-current assets/liabilities
|
(801
|
)
|
|
(1,857
|
)
|
||
Net cash (used in) provided by operating activities
|
(41
|
)
|
|
3,189
|
|
||
Cash flows from investing activities:
|
|
|
|
|
|
||
Acquisitions, net of cash acquired
|
—
|
|
|
(236,091
|
)
|
||
Purchases of property and equipment
|
(2,347
|
)
|
|
(5,128
|
)
|
||
Net cash used in investing activities
|
(2,347
|
)
|
|
(241,219
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
||
Proceeds from issuance of term note
|
290,000
|
|
|
135,000
|
|
||
Principal payments of term loan
|
(141,625
|
)
|
|
(1,688
|
)
|
||
Principal payments of convertible senior notes
|
(126,892
|
)
|
|
—
|
|
||
Settlement of capped call transactions
|
2,118
|
|
|
—
|
|
||
Payment of debt issuance costs
|
(7,482
|
)
|
|
(4,689
|
)
|
||
Payment of debt extinguishment costs
|
(711
|
)
|
|
—
|
|
||
Proceeds from revolver
|
25,000
|
|
|
10,000
|
|
||
Repayment of revolver
|
(25,000
|
)
|
|
(10,000
|
)
|
||
Proceeds from stock issuance, net
|
—
|
|
|
84,586
|
|
||
Other
|
(185
|
)
|
|
216
|
|
||
Net cash provided by financing activities
|
15,223
|
|
|
213,425
|
|
||
Net increase (decrease) in cash and cash equivalents
|
12,835
|
|
|
(24,605
|
)
|
||
Cash and cash equivalents at beginning of period
|
17,832
|
|
|
41,871
|
|
||
Cash and cash equivalents at end of period
|
$
|
30,667
|
|
|
$
|
17,266
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||
Cash paid for interest
|
$
|
15,088
|
|
|
$
|
6,622
|
|
Cash (received) paid for income taxes, net
|
$
|
(137
|
)
|
|
$
|
15
|
|
|
December 31, 2017
|
||||||||||
|
As Previously Reported
|
|
Adjustment
|
|
As Revised
|
||||||
Inventories, net
|
$
|
20,496
|
|
|
$
|
3,841
|
|
|
$
|
24,337
|
|
Property and equipment, net
|
43,283
|
|
|
(7,142
|
)
|
|
36,141
|
|
|||
TOTAL ASSETS
|
686,907
|
|
|
(3,301
|
)
|
|
683,606
|
|
|||
Deferred tax liability, net
|
19,174
|
|
|
193
|
|
|
19,367
|
|
|||
TOTAL LIABILITIES
|
375,895
|
|
|
193
|
|
|
376,088
|
|
|||
Accumulated deficit
|
(111,939
|
)
|
|
(3,494
|
)
|
|
(115,433
|
)
|
|||
TOTAL STOCKHOLDERS' EQUITY
|
311,012
|
|
|
(3,494
|
)
|
|
307,518
|
|
|
Three months ended September 30, 2017
|
||||||||||
|
As Previously Reported
|
|
Adjustment
|
|
As Revised
|
||||||
Cost of revenue, excluding amortization
|
$
|
93,116
|
|
|
$
|
359
|
|
|
$
|
93,475
|
|
Operating expenses
|
24,408
|
|
|
373
|
|
|
24,781
|
|
|||
Operating loss
|
1,266
|
|
|
(732
|
)
|
|
534
|
|
|||
Loss before income taxes
|
(3,317
|
)
|
|
(732
|
)
|
|
(4,049
|
)
|
|||
Income tax expense (benefit), net
|
2,012
|
|
|
(32
|
)
|
|
1,980
|
|
|||
Net loss
|
(5,329
|
)
|
|
(700
|
)
|
|
(6,029
|
)
|
|||
|
|
|
|
|
|
||||||
Basic net loss per share
|
$
|
(0.11
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.12
|
)
|
Diluted loss per share
|
$
|
(0.11
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.12
|
)
|
|
Nine months ended September 30, 2017
|
||||||||||
|
As Previously Reported
|
|
Adjustment
|
|
As Revised
|
||||||
Cost of revenue, excluding amortization
|
$
|
235,186
|
|
|
$
|
936
|
|
|
$
|
236,122
|
|
Operating expenses
|
80,551
|
|
|
1,121
|
|
|
81,672
|
|
|||
Operating loss
|
(9,887
|
)
|
|
(2,057
|
)
|
|
(11,944
|
)
|
|||
Loss before income taxes
|
(21,864
|
)
|
|
(2,057
|
)
|
|
(23,921
|
)
|
|||
Income tax (benefit) expense, net
|
5,136
|
|
|
(97
|
)
|
|
5,039
|
|
|||
Net loss
|
(27,000
|
)
|
|
(1,960
|
)
|
|
(28,960
|
)
|
|||
|
|
|
|
|
|
||||||
Basic net loss per share
|
$
|
(0.56
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.60
|
)
|
Diluted loss per share
|
$
|
(0.56
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.60
|
)
|
|
Nine months ended September 30, 2017
|
|||||||
|
As Previously Reported
|
|
Adjustment
|
|
As Revised
|
|||
Net Loss
|
(27,000
|
)
|
|
(1,960
|
)
|
|
(28,960
|
)
|
Depreciation and amortization expense
|
15,024
|
|
|
1,347
|
|
|
16,371
|
|
Deferred taxes
|
5,109
|
|
|
(97
|
)
|
|
5,012
|
|
Inventory, net
|
(3,582
|
)
|
|
(2,247
|
)
|
|
(5,829
|
)
|
Net cash used in operating activities
|
6,146
|
|
|
(2,957
|
)
|
|
3,189
|
|
Purchase of property and equipment
|
(8,085
|
)
|
|
2,957
|
|
|
(5,128
|
)
|
Net cash used in investing activities
|
(244,176
|
)
|
|
2,957
|
|
|
(241,219
|
)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net loss
|
(1,986
|
)
|
|
(6,029
|
)
|
|
$
|
(16,779
|
)
|
|
$
|
(28,960
|
)
|
||
Weighted average shares – basic
|
49,833
|
|
|
49,771
|
|
|
49,814
|
|
|
48,627
|
|
||||
Effect of dilutive potential common shares
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Weighted average shares – diluted
|
49,833
|
|
|
49,771
|
|
|
49,814
|
|
|
48,627
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net loss per share – basic
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.60
|
)
|
Net loss per share – diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.12
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.60
|
)
|
Anti-dilutive share-based awards, excluded
|
3,688
|
|
|
2,841
|
|
|
3,688
|
|
|
2,841
|
|
|
As Revised
|
|
|
|
Adjusted
|
||||||
|
December 31, 2017
|
|
Adjustments
|
|
January 1, 2018
|
||||||
|
(in thousands)
|
||||||||||
Assets:
|
|
|
|
|
|
||||||
Unbilled receivables
|
$
|
37,785
|
|
|
$
|
1,166
|
|
|
$
|
38,951
|
|
Inventories, net
|
24,337
|
|
|
(292
|
)
|
|
24,045
|
|
|||
Prepaid expenses
|
2,266
|
|
|
(403
|
)
|
|
1,863
|
|
|||
Liabilities:
|
|
|
|
|
|
|
|
||||
Accrued expenses
|
$
|
17,862
|
|
|
$
|
49
|
|
|
$
|
17,911
|
|
Deferred revenue
|
6,090
|
|
|
1,743
|
|
|
7,833
|
|
|||
Deferred tax liability, net
|
19,367
|
|
|
(325
|
)
|
|
19,042
|
|
|||
Equity:
|
|
|
|
|
|
||||||
Accumulated deficit
|
$
|
(115,433
|
)
|
|
$
|
(996
|
)
|
|
$
|
(116,429
|
)
|
|
September 30, 2018
|
||||||
|
As Reported
(ASC 606) |
|
As Adjusted
(ASC 605) |
||||
|
(in thousands)
|
||||||
Assets:
|
|
|
|
||||
Unbilled receivables
|
$
|
55,490
|
|
|
$
|
55,188
|
|
Inventories, net
|
26,342
|
|
|
26,610
|
|
||
Liabilities:
|
|
|
|
|
|
||
Accrued expenses
|
$
|
16,190
|
|
|
$
|
15,737
|
|
Deferred revenue
|
3,465
|
|
|
3,016
|
|
||
Deferred tax liability, net
|
15,735
|
|
|
16,085
|
|
||
Equity:
|
|
|
|
||||
Accumulated deficit
|
$
|
(133,208
|
)
|
|
$
|
(132,690
|
)
|
|
Three months ended September 30, 2018
|
|
Nine months ended September 30, 2018
|
||||||||||||
|
As Reported
(ASC 606) |
|
As Adjusted
(ASC 605) |
|
As Reported
(ASC 606) |
|
As Adjusted
(ASC 605) |
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
Revenue
|
$
|
126,690
|
|
|
$
|
127,889
|
|
|
$
|
380,572
|
|
|
$
|
380,142
|
|
Cost of revenue, excluding amortization
|
91,771
|
|
|
91,761
|
|
|
281,813
|
|
|
281,836
|
|
||||
Operating income
|
3,743
|
|
|
4,953
|
|
|
8,098
|
|
|
7,645
|
|
||||
Loss before income taxes
|
(2,672
|
)
|
|
(1,462
|
)
|
|
(20,348
|
)
|
|
(20,801
|
)
|
||||
Income tax benefit, net
|
(686
|
)
|
|
(371
|
)
|
|
(3,569
|
)
|
|
(3,544
|
)
|
||||
Net loss
|
(1,986
|
)
|
|
(1,091
|
)
|
|
(16,779
|
)
|
|
(17,257
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Loss per share
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.04
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.35
|
)
|
Diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.35
|
)
|
Revenue by Customer Type and Contract Type
|
Three months ended September 30, 2018
|
|
Nine months ended September 30, 2018
|
||||
|
|
|
(in thousands)
|
||||
Department of Defense
|
|
|
|
||||
Cost Reimbursement
|
$
|
44,080
|
|
|
$
|
131,641
|
|
Time & Materials and Fixed-Price-Level-of-Effort
|
23,174
|
|
|
74,842
|
|
||
Firm-Fixed-Price
|
29,655
|
|
|
83,692
|
|
||
Total Department of Defense
|
96,909
|
|
|
290,175
|
|
||
|
|
|
|
||||
Non-Department of Defense U.S. Government
|
|
|
|
||||
Cost Reimbursement
|
2,219
|
|
|
6,093
|
|
||
Time & Materials and Fixed-Price-Level-of-Effort
|
19,062
|
|
|
57,956
|
|
||
Firm-Fixed-Price
|
2,464
|
|
|
7,851
|
|
||
Total Non-Department of Defense U.S. Government
|
23,745
|
|
|
71,900
|
|
||
|
|
|
|
||||
Commercial and other
|
|
|
|
||||
Cost Reimbursement
|
—
|
|
|
—
|
|
||
Time & Materials and Fixed-Price-Level-of-Effort
|
1,078
|
|
|
2,906
|
|
||
Firm-Fixed-Price
|
4,958
|
|
|
15,591
|
|
||
Total Commercial and other
|
6,036
|
|
|
18,497
|
|
||
|
|
|
|
||||
Total Revenues
|
$
|
126,690
|
|
|
$
|
380,572
|
|
|
|
||
Cash
|
$
|
11,583
|
|
Receivables
|
37,521
|
|
|
Prepaid expenses
|
1,679
|
|
|
Property and equipment
|
1,499
|
|
|
Other intangibles
|
60,590
|
|
|
Goodwill
|
164,487
|
|
|
Deferred tax assets
|
142
|
|
|
Other assets
|
1,149
|
|
|
Total assets acquired
|
278,650
|
|
|
Accounts payable
|
7,007
|
|
|
Accrued expenses
|
9,818
|
|
|
Accrued salaries and wages
|
10,784
|
|
|
Deferred revenue
|
1,505
|
|
|
Long-term obligations
|
2,097
|
|
|
Total liabilities assumed
|
31,211
|
|
|
Net assets acquired
|
$
|
247,439
|
|
Net cash paid
|
$
|
235,856
|
|
Actual cash paid
|
$
|
247,439
|
|
|
|
Weighted average amortization period
|
|
Fair Value
|
||
|
|
(in years)
|
|
(in thousands)
|
||
Customer relationships
|
|
16
|
|
$
|
56,700
|
|
Backlog
|
|
1
|
|
3,890
|
|
|
Total
|
|
|
|
$
|
60,590
|
|
|
Three months ended
|
|
Nine months ended
|
||||
|
September 30, 2017
|
|
September 30,
2017
|
||||
|
(unaudited and in thousands)
|
||||||
Revenues
|
$
|
122,394
|
|
|
$
|
376,653
|
|
Net (loss) income from continuing operations
|
(6,029
|
)
|
|
(34,832
|
)
|
Level 1
|
Inputs are unadjusted quoted prices in active markets for identical assets or liabilities the Company has the ability to access.
|
Level 2
|
Inputs are other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
|
Level 3
|
Inputs are unobservable for the asset or liability and rely on management’s own assumptions about what market participants would use in pricing the asset or liability.
|
|
Balance Sheet Classification
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Assets:
|
|
|
(In thousands)
|
||||||
Derivatives
|
Other assets
|
|
$
|
545
|
|
|
$
|
—
|
|
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
Classification of gain (loss) recognized
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|||||||||
Cash Flow Hedges:
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
Accumulated other comprehensive income
|
|
$
|
448
|
|
|
$
|
—
|
|
|
$
|
448
|
|
|
$
|
—
|
|
Interest rate swaps
|
Interest expense
|
|
$
|
(65
|
)
|
|
$
|
—
|
|
|
$
|
(65
|
)
|
|
$
|
—
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
|
(In thousands)
|
||||||
Property and equipment
|
|
|
|
|
|
||
Aircraft
|
$
|
29,853
|
|
|
$
|
27,567
|
|
Leasehold improvements
|
20,462
|
|
|
23,506
|
|
||
Manufacturing equipment
|
5,476
|
|
|
7,778
|
|
||
Software development costs
|
2,111
|
|
|
2,111
|
|
||
Office equipment
|
9,730
|
|
|
15,884
|
|
||
Total
|
67,632
|
|
|
76,846
|
|
||
Accumulated depreciation
|
(41,108
|
)
|
|
(40,705
|
)
|
||
Property and equipment, net
|
$
|
26,524
|
|
|
$
|
36,141
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Gross Carrying Value
|
|
Accumulated Amortization
|
|
Net Carrying Value
|
|
Gross Carrying Value
|
|
Accumulated Amortization
|
|
Net Carrying Value
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer relationships and contracts
|
$
|
57,564
|
|
|
$
|
(11,158
|
)
|
|
$
|
46,406
|
|
|
$
|
66,513
|
|
|
$
|
(11,039
|
)
|
|
$
|
55,474
|
|
Software technology and other
|
2,162
|
|
|
(923
|
)
|
|
1,239
|
|
|
2,162
|
|
|
(591
|
)
|
|
1,571
|
|
||||||
Total intangible assets
|
$
|
59,726
|
|
|
$
|
(12,081
|
)
|
|
$
|
47,645
|
|
|
$
|
68,675
|
|
|
$
|
(11,630
|
)
|
|
$
|
57,045
|
|
Fiscal Year Ending
|
|
|
||
|
|
(in thousands)
|
||
2018 (remainder of year)
|
|
$
|
2,720
|
|
2019
|
|
9,226
|
|
|
2020
|
|
7,415
|
|
|
2021
|
|
5,973
|
|
|
2022
|
|
4,634
|
|
|
2023 and thereafter
|
|
17,677
|
|
|
Total
|
|
$
|
47,645
|
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||
|
Maturity Date
|
|
Amount
|
|
Effective Rate
|
|
Amount
|
|
Effective Rate
|
||||
|
|
|
(in thousands)
|
|
|
|
(in thousands)
|
|
|
||||
Senior secured term loans:
|
|
|
|
|
|
|
|
|
|
||||
$215 million First Lien Term Loan
|
May 8, 2024
|
|
$
|
205,000
|
|
|
7.0%
|
|
$
|
—
|
|
|
—%
|
$75 million Second Lien Term Loan
|
May 8, 2025
|
|
75,000
|
|
|
11.7%
|
|
—
|
|
|
—%
|
||
$135 million Term Loan
|
April 4, 2022
(1)
|
|
—
|
|
|
—%
|
|
131,625
|
|
|
6.2%
|
||
$50 million Revolver
|
May 8, 2023
|
|
—
|
|
|
—%
|
|
—
|
|
|
—%
|
||
Convertible Senior Notes
|
July 15, 2019
|
|
22,608
|
|
|
7.4%
|
|
149,500
|
|
|
6.9%
|
||
Total
|
|
|
302,608
|
|
|
|
|
281,125
|
|
|
|
||
Unamortized discount/issuance costs
|
|
|
(7,179
|
)
|
|
|
|
(14,750
|
)
|
|
|
||
Total
|
|
|
$
|
295,429
|
|
|
|
|
$
|
266,375
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reported as:
|
|
|
|
|
|
|
|
|
|
||||
Term loan – current portion, net of discount
|
|
|
$
|
—
|
|
|
|
|
$
|
6,750
|
|
|
|
Convertible senior notes – current portion, net of discount
|
|
|
21,780
|
|
|
|
|
—
|
|
|
|
||
Term loan – non-current portion, net of discount
|
|
|
273,649
|
|
|
|
|
120,627
|
|
|
|
||
Convertible senior notes – non-current portion, net of discount
|
|
|
—
|
|
|
|
|
138,998
|
|
|
|
||
Total
|
|
|
$
|
295,429
|
|
|
|
|
$
|
266,375
|
|
|
|
•
|
Eurodollar Loans will accrue interest, for any interest period, at the Eurodollar Rate (as defined in the First Lien Credit Agreement), plus an applicable margin of
4.5%
.
|
•
|
Base Rate Loans will accrue interest, for any interest period, at (a) a base rate per annum equal to the highest of (i) the Federal funds rate plus
0.5%
; (ii) the prime commercial lending rate announced by Royal Bank of Canada (RBC) from time to time as its prime lending rate; and (iii) the Eurodollar Rate for a one month interest period plus
1.0%
, plus (b) an applicable margin of
3.5%
.
|
•
|
The applicable margin for borrowings may be decreased if our consolidated net leverage ratio decreases.
|
•
|
Eurodollar Loans will accrue interest, for any interest period, at the Eurodollar Rate (as defined in the Second Lien Credit Agreements) plus an applicable margin of
8.75%
.
|
•
|
Base Rate Loans will accrue interest, for any interest period, at (a) a base rate per annum equal to the highest of (i) the Federal funds rate plus
0.5%
; (ii) the prime commercial lending rate announced by RBC from time to time as its prime lending rate; and (iii) the Eurodollar Rate for a one month interest period plus
1.0%
, plus (b) an applicable margin of
7.75
%.
|
|
Loss on Extinguishment of Debt
|
|
Capitalized and Amortized Over Life of New Issuances
|
|
Total
|
||||||
|
(in thousands)
|
||||||||||
New debt issuance costs
|
$
|
364
|
|
|
$
|
7,118
|
|
|
$
|
7,482
|
|
Previously incurred unamortized debt issuance costs or discount
|
3,571
|
|
|
348
|
|
|
3,919
|
|
|||
Total
|
$
|
3,935
|
|
|
$
|
7,466
|
|
|
$
|
11,401
|
|
|
Number of
Shares
|
|
Option Exercise
Price
|
|
Weighted Average Exercise Price
|
||||
Options Outstanding January 1, 2018
|
879,810
|
|
|
|
|
|
|||
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
Exercised
|
(67,086
|
)
|
|
$5.00 - $9.25
|
|
|
$
|
5.29
|
|
Cancelled
|
(74,249
|
)
|
|
$5.50 - $17.11
|
|
|
$
|
10.65
|
|
Options Outstanding September 30, 2018
|
738,475
|
|
|
|
|
|
|
Exercise Price
|
Options Outstanding and Vested
|
|
Intrinsic Value
|
|
Weighted Average Remaining Life (Years)
|
|||
$5.00 – $5.50
|
171,000
|
|
|
$
|
544,360
|
|
|
1.05
|
$6.90 – $7.66
|
135,950
|
|
|
165,198
|
|
|
3.32
|
|
$7.96 – $9.25
|
113,926
|
|
|
37,434
|
|
|
2.44
|
|
$9.50 - $11.67
|
90,600
|
|
|
—
|
|
|
3.56
|
|
$11.99 - $12.97
|
85,775
|
|
|
—
|
|
|
3.67
|
|
$13.00 - $14.33
|
60,224
|
|
|
—
|
|
|
4.08
|
|
$14.88 - $17.11
|
81,000
|
|
|
—
|
|
|
5.31
|
|
|
738,475
|
|
|
$
|
746,992
|
|
|
|
|
Unvested Shares
|
|
Outstanding January 1, 2018
|
635,223
|
|
Granted
|
—
|
|
Vested
|
(262,483
|
)
|
Cancelled
|
(78,975
|
)
|
Outstanding September 30, 2018
|
293,765
|
|
|
Unvested Units
|
|
Outstanding January 1, 2018
|
337,423
|
|
Granted
|
373,175
|
|
Vested
|
—
|
|
Cancelled
|
(46,000
|
)
|
Outstanding September 30, 2018
|
664,598
|
|
|
Unvested Performance Units
|
|
Outstanding January 1, 2018
|
17,557
|
|
Granted
|
229,646
|
|
Vested
|
—
|
|
Cancelled
|
(5,000
|
)
|
Outstanding September 30, 2018
|
242,203
|
|
|
Unvested Long-Term Incentive Shares
|
|
Outstanding January 1, 2018
|
1,725,000
|
|
Granted
|
270,000
|
|
Cancelled
|
(110,000
|
)
|
Outstanding September 30, 2018
|
1,885,000
|
|
Exercise Price
|
|
Warrants Outstanding and Vested
|
|
Remaining Life (Years)
|
$12.65
|
|
158,116
|
|
1.16
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
CONSOLIDATED OVERVIEW
(In thousands) |
|
Three months ended September 30, 2018
|
|
% of Revenue
|
|
Three months ended September 30, 2017
|
|
% of Revenue
|
||||||
Revenue
|
|
$
|
126,690
|
|
|
100.0
|
%
|
|
$
|
122,394
|
|
|
100.0
|
%
|
Cost of revenue
|
|
91,771
|
|
|
72.4
|
%
|
|
93,475
|
|
|
76.4
|
%
|
||
Operating expenses
|
|
28,455
|
|
|
22.5
|
%
|
|
24,781
|
|
|
20.2
|
%
|
||
Intangible amortization
|
|
2,721
|
|
|
2.1
|
%
|
|
3,604
|
|
|
2.9
|
%
|
||
Interest expense, net
|
|
6,240
|
|
|
4.9
|
%
|
|
4,829
|
|
|
3.9
|
%
|
||
Income tax (benefit) expense, net
|
|
(686
|
)
|
|
(0.5
|
)%
|
|
1,980
|
|
|
1.6
|
%
|
CONSOLIDATED OVERVIEW
(In thousands) |
|
Nine months ended September 30, 2018
|
|
% of Revenue
|
|
Nine months ended September 30, 2017
|
|
% of Revenue
|
||||||
Revenue
|
|
$
|
380,572
|
|
|
100.0
|
%
|
|
$
|
314,708
|
|
|
100.0
|
%
|
Cost of revenue, excluding amortization
|
|
281,813
|
|
|
74.0
|
%
|
|
236,122
|
|
|
75.0
|
%
|
||
Operating expenses
|
|
81,262
|
|
|
21.4
|
%
|
|
81,672
|
|
|
26.0
|
%
|
||
Intangible amortization
|
|
9,399
|
|
|
2.5
|
%
|
|
8,858
|
|
|
2.8
|
%
|
||
Interest expense, net
|
|
16,974
|
|
|
4.5
|
%
|
|
12,352
|
|
|
3.9
|
%
|
||
Income tax (benefit) expense, net
|
|
(3,569
|
)
|
|
(0.9
|
)%
|
|
5,039
|
|
|
1.6
|
%
|
•
|
Eurodollar Loans will accrue interest, for any interest period, at the Eurodollar Rate (as defined in the First Lien Credit Agreement), plus an applicable margin of 4.5%.
|
•
|
Base Rate Loans will accrue interest, for any interest period, at (a) a base rate per annum equal to the highest of (i) the Federal funds rate plus 0.5%; (ii) the prime commercial lending rate announced by Royal Bank of Canada (RBC) from time to time as its prime lending rate; and (iii) the Eurodollar Rate for a one month interest period plus 1.0%, plus (b) an applicable margin of 3.5%.
|
•
|
The applicable margin for borrowings may be decreased if our consolidated net leverage ratio decreases.
|
•
|
Eurodollar Loans will accrue interest, for any interest period, at the Eurodollar Rate (as defined in the Second Lien Credit Agreements) plus an applicable margin of 8.75%.
|
•
|
Base Rate Loans will accrue interest, for any interest period, at (a) a base rate per annum equal to the highest of (i) the Federal funds rate plus 0.5%; (ii) the prime commercial lending rate announced by RBC from time to time as its prime lending rate; and (iii) the Eurodollar Rate for a one month interest period plus 1.0%, plus (b) an applicable margin of 7.75%.
|
•
|
Control Environment - The Company implemented changes to the Company’s control environment which included the following: (i) hired five new key accounting team members with the appropriate experience, certifications, education,
|
•
|
Control Activities - The Company executed specific actions to improve the performance of internal control activities including: (i) enhanced process and control documentation including the development of detailed control checklists that identify control owners, critical design and control elements, and responsibilities for effectively performing controls; (ii) implemented automated workflows to reduce reliance on manual processes in support of timely and effective control activities; and (iii) created and enforced adherence to a quarterly certification of internal controls by control owners and preparers.
|
|
|
THE KEYW HOLDING CORPORATION
|
|
|
|
|
|
Date:
|
November 6, 2018
|
By:
|
/s/ William J. Weber
|
|
|
William J. Weber
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
Date:
|
November 6, 2018
|
By:
|
/s/ Michael J. Alber
|
|
|
Michael J. Alber
|
|
|
|
Executive Vice President and Chief Financial Officer
|
Exhibit No.
|
|
Exhibit Description
|
|
|
|
|
|
3.1
|
|
(1)
|
|
|
|
|
|
3.2
|
|
(2)
|
|
|
|
|
|
3.3
|
|
(3)
|
|
|
|
|
|
4.1
|
|
(4)
|
|
|
|
|
|
4.2
|
|
(5)
|
|
|
|
|
|
4.3
|
|
(5)
|
|
|
|
|
|
4.4
|
|
(5)
|
|
|
|
|
|
31.1
|
|
x
|
|
|
|
|
|
31.2
|
|
x
|
|
|
|
|
|
32.1*
|
|
x
|
|
|
|
|
|
101.INS**
|
|
XBRL Instance Document
|
x
|
|
|
|
|
101.SCH**
|
|
XBRL Taxonomy Extension Schema Document
|
x
|
|
|
|
|
101.CAL**
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
x
|
|
|
|
|
101.LAB**
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
x
|
|
|
|
|
101.PRE**
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
x
|
|
|
|
|
101.DEF**
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
x
|
|
x
|
Filed herewith.
|
(1)
|
Filed as Exhibit 3.1 to the Registrant's Form 10-K filed March 29, 2011, File No. 001-34891.
|
(2)
|
Filed as Exhibit 3.1 to the Registrant's Form 8-K filed July 15, 2014, File No. 001-34891.
|
(3)
|
Filed as Exhibit 3.1 to the Registrant's Form 8-K reporting under Items 5.02, 5.03, 5.07, filed August 15, 2014, File No. 001-34891.
|
(4)
|
Filed as Exhibit 4.1 to Pre-Effective Amendment No. 4 to the Registrant's Registration Statement on Form S-1, filed September 30, 2010, File No. 333-167608.
|
(5)
|
Filed as Exhibits 4.1 and 4.2 respectively to the Registrant’s Current Report on Form 8-K filed July 21, 2014, File No. 001-38491.
|
*
|
This exhibit is being “furnished” with this periodic report and are not deemed “filed” with the Securities and Exchange Commission and are not incorporated by reference in any filing of the Company under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation by reference language in any such filing.
|
**
|
Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.
|
***
|
Indicates management contract or compensatory plan, contract or arrangement.
|
1 Year Essex Chart |
1 Month Essex Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions