We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
ARC Document Solutions Inc | NYSE:ARC | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.03 | -1.11% | 2.68 | 2.72 | 2.69 | 2.72 | 67,965 | 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
|
Delaware
|
20-1700361
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
Large accelerated filer
|
¨
|
Accelerated filer
|
ý
|
|
|
|
|
Non-accelerated filer
|
¨
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
ý
|
|
|
|
|
|
|
Emerging growth company
|
¨
|
PART I—FINANCIAL INFORMATION
|
|
Item 1. Condensed Consolidated Financial Statements
|
|
Condensed Consolidated Balance Sheets as of September 30, 2018 and December 31, 2017 (Unaudited)
|
|
Condensed Consolidated Statements of Operations for the three and nine months ended September, 30 2018 and 2017 (Unaudited)
|
|
Condensed Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2018 and 2017 (Unaudited)
|
|
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2018 and 2017 (Unaudited)
|
|
Notes to Condensed Consolidated Financial Statements (Unaudited)
|
|
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Item 3. Quantitative and Qualitative Disclosures About Market Risk
|
|
Item 4. Controls and Procedures
|
|
PART II—OTHER INFORMATION
|
|
Item 1. Legal Proceedings
|
|
Item 1A. Risk Factors
|
|
Item 6. Exhibits
|
|
Signatures
|
|
Exhibit Index
|
|
Exhibit 31.1
|
|
Exhibit 31.2
|
|
Exhibit 32.1
|
|
Exhibit 32.2
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
(In thousands, except per share data)
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
18,404
|
|
|
$
|
28,059
|
|
Accounts receivable, net of allowances for accounts receivable of
$2,366
and $2,341
|
62,478
|
|
|
57,011
|
|
||
Inventories, net
|
18,301
|
|
|
19,937
|
|
||
Prepaid expenses
|
6,371
|
|
|
4,208
|
|
||
Other current assets
|
5,209
|
|
|
5,266
|
|
||
Total current assets
|
110,763
|
|
|
114,481
|
|
||
Property and equipment, net of accumulated depreciation of
$201,126
and $198,693
|
69,133
|
|
|
64,245
|
|
||
Goodwill
|
121,051
|
|
|
121,051
|
|
||
Other intangible assets, net
|
6,078
|
|
|
9,068
|
|
||
Deferred income taxes
|
25,738
|
|
|
28,029
|
|
||
Other assets
|
2,601
|
|
|
2,551
|
|
||
Total assets
|
$
|
335,364
|
|
|
$
|
339,425
|
|
Liabilities and Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
22,848
|
|
|
$
|
24,289
|
|
Accrued payroll and payroll-related expenses
|
13,009
|
|
|
12,617
|
|
||
Accrued expenses
|
17,896
|
|
|
17,201
|
|
||
Current portion of long-term debt and capital leases
|
21,334
|
|
|
20,791
|
|
||
Total current liabilities
|
75,087
|
|
|
74,898
|
|
||
Long-term debt and capital leases
|
110,889
|
|
|
123,626
|
|
||
Other long-term liabilities
|
4,474
|
|
|
3,290
|
|
||
Total liabilities
|
190,450
|
|
|
201,814
|
|
||
Commitments and contingencies (Note 6)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
ARC Document Solutions, Inc. stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.001 par value, 25,000 shares authorized;
0
shares issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value, 150,000 shares authorized;
48,464
and 47,913 shares issued and
45,790
and 45,266 shares outstanding
|
48
|
|
|
48
|
|
||
Additional paid-in capital
|
122,878
|
|
|
120,953
|
|
||
Retained earnings
|
27,785
|
|
|
20,524
|
|
||
Accumulated other comprehensive loss
|
(3,457
|
)
|
|
(1,998
|
)
|
||
|
147,254
|
|
|
139,527
|
|
||
Less cost of common stock in treasury,
2,674
and 2,647 shares
|
9,350
|
|
|
9,290
|
|
||
Total ARC Document Solutions, Inc. stockholders’ equity
|
137,904
|
|
|
130,237
|
|
||
Noncontrolling interest
|
7,010
|
|
|
7,374
|
|
||
Total equity
|
144,914
|
|
|
137,611
|
|
||
Total liabilities and equity
|
$
|
335,364
|
|
|
$
|
339,425
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In thousands, except per share data)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Service sales
|
$
|
88,419
|
|
|
$
|
85,625
|
|
|
$
|
267,160
|
|
|
$
|
262,459
|
|
Equipment and supplies sales
|
12,054
|
|
|
10,833
|
|
|
35,211
|
|
|
35,010
|
|
||||
Total net sales
|
100,473
|
|
|
96,458
|
|
|
302,371
|
|
|
297,469
|
|
||||
Cost of sales
|
67,801
|
|
|
67,231
|
|
|
203,679
|
|
|
202,918
|
|
||||
Gross profit
|
32,672
|
|
|
29,227
|
|
|
98,692
|
|
|
94,551
|
|
||||
Selling, general and administrative expenses
|
26,973
|
|
|
25,843
|
|
|
81,780
|
|
|
76,540
|
|
||||
Amortization of intangible assets
|
949
|
|
|
1,053
|
|
|
2,942
|
|
|
3,250
|
|
||||
Goodwill impairment
|
—
|
|
|
17,637
|
|
|
—
|
|
|
17,637
|
|
||||
Income (loss) from operations
|
4,750
|
|
|
(15,306
|
)
|
|
13,970
|
|
|
(2,876
|
)
|
||||
Other expense (income), net
|
38
|
|
|
(19
|
)
|
|
(63
|
)
|
|
(60
|
)
|
||||
Loss on extinguishment and modification of debt
|
—
|
|
|
124
|
|
|
—
|
|
|
230
|
|
||||
Interest expense, net
|
1,478
|
|
|
1,530
|
|
|
4,436
|
|
|
4,679
|
|
||||
Income before income tax provision (benefit)
|
3,234
|
|
|
(16,941
|
)
|
|
9,597
|
|
|
(7,725
|
)
|
||||
Income tax provision (benefit)
|
647
|
|
|
(2,174
|
)
|
|
2,526
|
|
|
1,574
|
|
||||
Net income (loss)
|
2,587
|
|
|
(14,767
|
)
|
|
7,071
|
|
|
(9,299
|
)
|
||||
(Income) loss attributable to the noncontrolling interest
|
(28
|
)
|
|
(7
|
)
|
|
190
|
|
|
(55
|
)
|
||||
Net income (loss) attributable to ARC Document Solutions, Inc. shareholders
|
$
|
2,559
|
|
|
$
|
(14,774
|
)
|
|
$
|
7,261
|
|
|
$
|
(9,354
|
)
|
Earnings (loss) per share attributable to ARC Document Solutions, Inc. shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.06
|
|
|
$
|
(0.32
|
)
|
|
$
|
0.16
|
|
|
$
|
(0.20
|
)
|
Diluted
|
$
|
0.06
|
|
|
$
|
(0.32
|
)
|
|
$
|
0.16
|
|
|
$
|
(0.20
|
)
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
44,983
|
|
|
45,834
|
|
|
44,888
|
|
|
45,756
|
|
||||
Diluted
|
45,188
|
|
|
45,834
|
|
|
44,993
|
|
|
45,756
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss)
|
$
|
2,587
|
|
|
$
|
(14,767
|
)
|
|
$
|
7,071
|
|
|
$
|
(9,299
|
)
|
Other comprehensive (loss) income, net of tax
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments, net of tax
|
(320
|
)
|
|
681
|
|
|
(1,633
|
)
|
|
1,421
|
|
||||
Fair value adjustment of derivatives, net of tax
|
—
|
|
|
55
|
|
|
—
|
|
|
141
|
|
||||
Other comprehensive (loss) income, net of tax
|
(320
|
)
|
|
736
|
|
|
(1,633
|
)
|
|
1,562
|
|
||||
Comprehensive income (loss)
|
2,267
|
|
|
(14,031
|
)
|
|
5,438
|
|
|
(7,737
|
)
|
||||
Comprehensive (loss) income attributable to noncontrolling interest
|
(202
|
)
|
|
149
|
|
|
(364
|
)
|
|
369
|
|
||||
Comprehensive income (loss) attributable to ARC Document Solutions, Inc. shareholders
|
$
|
2,469
|
|
|
$
|
(14,180
|
)
|
|
$
|
5,802
|
|
|
$
|
(8,106
|
)
|
|
Nine Months Ended
September 30, |
||||||
(In thousands)
|
2018
|
|
2017
|
||||
Cash flows from operating activities
|
|
|
|
||||
Net income (loss)
|
$
|
7,071
|
|
|
$
|
(9,299
|
)
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Allowance for accounts receivable
|
637
|
|
|
867
|
|
||
Depreciation
|
21,708
|
|
|
21,787
|
|
||
Amortization of intangible assets
|
2,942
|
|
|
3,250
|
|
||
Amortization of deferred financing costs
|
175
|
|
|
246
|
|
||
Goodwill impairment
|
—
|
|
|
17,637
|
|
||
Stock-based compensation
|
1,824
|
|
|
2,251
|
|
||
Deferred income taxes
|
2,175
|
|
|
1,045
|
|
||
Deferred tax valuation allowance
|
71
|
|
|
488
|
|
||
Loss on extinguishment and modification of debt
|
—
|
|
|
230
|
|
||
Other non-cash items, net
|
(201
|
)
|
|
(340
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(6,594
|
)
|
|
406
|
|
||
Inventory
|
1,291
|
|
|
(650
|
)
|
||
Prepaid expenses and other assets
|
(2,326
|
)
|
|
(1,129
|
)
|
||
Accounts payable and accrued expenses
|
1,289
|
|
|
(33
|
)
|
||
Net cash provided by operating activities
|
30,062
|
|
|
36,756
|
|
||
Cash flows from investing activities
|
|
|
|
||||
Capital expenditures
|
(10,463
|
)
|
|
(7,246
|
)
|
||
Other
|
556
|
|
|
466
|
|
||
Net cash used in investing activities
|
(9,907
|
)
|
|
(6,780
|
)
|
||
Cash flows from financing activities
|
|
|
|
||||
Proceeds from stock option exercises
|
—
|
|
|
73
|
|
||
Proceeds from issuance of common stock under Employee Stock Purchase Plan
|
100
|
|
|
103
|
|
||
Share repurchases
|
(60
|
)
|
|
—
|
|
||
Contingent consideration on prior acquisitions
|
(176
|
)
|
|
(214
|
)
|
||
Early extinguishment of long-term debt
|
—
|
|
|
(14,150
|
)
|
||
Payments on long-term debt agreements and capital leases
|
(17,200
|
)
|
|
(60,060
|
)
|
||
Borrowings under revolving credit facilities
|
9,250
|
|
|
54,850
|
|
||
Payments under revolving credit facilities
|
(20,875
|
)
|
|
(9,675
|
)
|
||
Payment of deferred financing costs
|
—
|
|
|
(270
|
)
|
||
Net cash used in financing activities
|
(28,961
|
)
|
|
(29,343
|
)
|
||
Effect of foreign currency translation on cash balances
|
(849
|
)
|
|
491
|
|
||
Net change in cash and cash equivalents
|
(9,655
|
)
|
|
1,124
|
|
||
Cash and cash equivalents at beginning of period
|
28,059
|
|
|
25,239
|
|
||
Cash and cash equivalents at end of period
|
$
|
18,404
|
|
|
$
|
26,363
|
|
Supplemental disclosure of cash flow information
|
|
|
|
||||
Noncash investing and financing activities
|
|
|
|
||||
Capital lease obligations incurred
|
$
|
16,560
|
|
|
$
|
20,714
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Service Sales
|
|
|
|
|
|
|
|
||||||||
CDIM
|
$
|
52,418
|
|
|
$
|
50,089
|
|
|
$
|
160,270
|
|
|
$
|
155,031
|
|
MPS
|
32,384
|
|
|
32,153
|
|
|
97,181
|
|
|
97,697
|
|
||||
AIM
|
3,617
|
|
|
3,383
|
|
|
9,709
|
|
|
9,731
|
|
||||
Total service sales
|
88,419
|
|
|
85,625
|
|
|
267,160
|
|
|
262,459
|
|
||||
Equipment and supplies sales
|
12,054
|
|
|
10,833
|
|
|
35,211
|
|
|
35,010
|
|
||||
Total net sales
|
$
|
100,473
|
|
|
$
|
96,458
|
|
|
$
|
302,371
|
|
|
$
|
297,469
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Weighted average common shares outstanding during the period—basic
|
44,983
|
|
|
45,834
|
|
|
44,888
|
|
|
45,756
|
|
Effect of dilutive stock options
|
205
|
|
|
—
|
|
|
105
|
|
|
—
|
|
Weighted average common shares outstanding during the period—diluted
|
45,188
|
|
|
45,834
|
|
|
44,993
|
|
|
45,756
|
|
|
Gross
Goodwill |
|
Accumulated
Impairment Loss |
|
Net
Carrying Amount |
||||||
|
|
|
|
|
|
||||||
January 1, 2017
|
$
|
405,558
|
|
|
$
|
266,870
|
|
|
$
|
138,688
|
|
Goodwill impairment
|
—
|
|
|
17,637
|
|
|
(17,637
|
)
|
|||
December 31, 2017
|
405,558
|
|
|
284,507
|
|
|
121,051
|
|
|||
Goodwill impairment
|
—
|
|
|
—
|
|
|
—
|
|
|||
September 30, 2018
|
$
|
405,558
|
|
|
$
|
284,507
|
|
|
$
|
121,051
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Amortizable other intangible assets
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer relationships
|
$
|
99,332
|
|
|
$
|
93,598
|
|
|
$
|
5,734
|
|
|
$
|
99,486
|
|
|
$
|
90,805
|
|
|
$
|
8,681
|
|
Trade names and trademarks
|
20,262
|
|
|
19,918
|
|
|
344
|
|
|
20,297
|
|
|
19,910
|
|
|
387
|
|
||||||
|
$
|
119,594
|
|
|
$
|
113,516
|
|
|
$
|
6,078
|
|
|
$
|
119,783
|
|
|
$
|
110,715
|
|
|
$
|
9,068
|
|
2018 (excluding the nine months ended September 30, 2018)
|
$
|
931
|
|
2019
|
3,138
|
|
|
2020
|
1,529
|
|
|
2021
|
173
|
|
|
2022
|
99
|
|
|
Thereafter
|
208
|
|
|
|
$
|
6,078
|
|
•
|
Future reversals of existing taxable temporary differences;
|
•
|
Future taxable income exclusive of reversing temporary differences and carryforwards;
|
•
|
Taxable income in prior carryback years; and
|
•
|
Tax-planning strategies.
|
•
|
Nature, frequency, and severity of recent losses;
|
•
|
Duration of statutory carryforward periods;
|
•
|
Historical experience with tax attributes expiring unused; and
|
•
|
Near- and medium-term financial outlook.
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Term Loan maturing 2022, net of deferred financing fees of
$605
and $757;
3.87%
and 3.12% interest rate at September 30, 2018 and December 31, 2017
|
|
$
|
53,770
|
|
|
$
|
56,993
|
|
Revolving Loans;
4.09%
and 3.64% interest rate at September 30, 2018 and December 31, 2017
|
|
30,625
|
|
|
42,250
|
|
||
Various capital leases; weighted average interest rate of
4.6%
and 5.0% at September 30, 2018 and December 31, 2017; principal and interest payable monthly through September 2023
|
|
47,817
|
|
|
45,157
|
|
||
Various other notes payable with a weighted average interest rate of 10.7% at September 30, 2018 and December 31, 2017; principal and interest payable monthly through November 2019
|
|
11
|
|
|
17
|
|
||
|
|
132,223
|
|
|
144,417
|
|
||
Less current portion
|
|
(21,334
|
)
|
|
(20,791
|
)
|
||
|
|
$
|
110,889
|
|
|
$
|
123,626
|
|
|
Significant Other Unobservable Inputs
|
||||||||||||||
|
September 30, 2018
|
|
September 30, 2017
|
||||||||||||
|
Level 3
|
|
Total Losses
|
|
Level 3
|
|
Total Losses
|
||||||||
Nonrecurring Fair Values
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|||||||
Goodwill
|
$
|
121,051
|
|
|
$
|
—
|
|
|
$
|
121,051
|
|
|
$
|
17,637
|
|
|
Three Months Ended September 30,
|
|
Increase (decrease)
|
|
Nine Months Ended
September 30, |
|
Increase (decrease)
|
||||||||||||||||||||||
(In millions, except percentages)
|
2018
|
|
2017 (1)
|
|
$
|
|
%
|
|
2018
|
|
2017 (1)
|
|
$
|
|
%
|
||||||||||||||
CDIM
|
$
|
52.4
|
|
|
$
|
50.1
|
|
|
$
|
2.3
|
|
|
4.6
|
%
|
|
$
|
160.3
|
|
|
$
|
155.0
|
|
|
$
|
5.2
|
|
|
3.4
|
%
|
MPS
|
32.4
|
|
|
32.2
|
|
|
0.2
|
|
|
0.7
|
%
|
|
97.2
|
|
|
97.7
|
|
|
(0.5
|
)
|
|
(0.5
|
)%
|
||||||
AIM
|
3.6
|
|
|
3.4
|
|
|
0.2
|
|
|
6.9
|
%
|
|
9.7
|
|
|
9.7
|
|
|
—
|
|
|
(0.2
|
)%
|
||||||
Total service sales
|
88.4
|
|
|
85.6
|
|
|
2.8
|
|
|
3.3
|
%
|
|
267.2
|
|
|
262.5
|
|
|
4.7
|
|
|
1.8
|
%
|
||||||
Equipment and supplies sales
|
12.1
|
|
|
10.8
|
|
|
1.2
|
|
|
11.3
|
%
|
|
35.2
|
|
|
35.0
|
|
|
0.2
|
|
|
0.6
|
%
|
||||||
Total net sales
|
$
|
100.5
|
|
|
$
|
96.5
|
|
|
$
|
4.0
|
|
|
4.2
|
%
|
|
$
|
302.4
|
|
|
$
|
297.5
|
|
|
$
|
4.9
|
|
|
1.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross profit
|
$
|
32.7
|
|
|
$
|
29.2
|
|
|
$
|
3.4
|
|
|
11.8
|
%
|
|
$
|
98.7
|
|
|
$
|
94.6
|
|
|
$
|
4.1
|
|
|
4.4
|
%
|
Selling, general and administrative expenses
|
$
|
27.0
|
|
|
$
|
25.8
|
|
|
$
|
1.1
|
|
|
4.4
|
%
|
|
$
|
81.8
|
|
|
$
|
76.5
|
|
|
$
|
5.2
|
|
|
6.8
|
%
|
Amortization of intangibles
|
$
|
0.9
|
|
|
$
|
1.1
|
|
|
$
|
(0.1
|
)
|
|
(9.9
|
)%
|
|
$
|
2.9
|
|
|
$
|
3.3
|
|
|
$
|
(0.3
|
)
|
|
(9.5
|
)%
|
Goodwill impairment
|
$
|
—
|
|
|
$
|
17.6
|
|
|
$
|
(17.6
|
)
|
|
(100.0
|
)%
|
|
$
|
—
|
|
|
$
|
17.6
|
|
|
$
|
(17.6
|
)
|
|
(100.0
|
)%
|
Loss on extinguishment and modification of debt
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
(0.1
|
)
|
|
(100.0
|
)%
|
|
$
|
—
|
|
|
$
|
0.2
|
|
|
$
|
(0.2
|
)
|
|
(100.0
|
)%
|
Interest expense, net
|
$
|
1.5
|
|
|
$
|
1.5
|
|
|
$
|
(0.1
|
)
|
|
(3.4
|
)%
|
|
$
|
4.4
|
|
|
$
|
4.7
|
|
|
$
|
(0.2
|
)
|
|
(5.2
|
)%
|
Income tax provision (benefit)
|
$
|
0.6
|
|
|
$
|
(2.2
|
)
|
|
$
|
2.8
|
|
|
(129.8
|
)%
|
|
$
|
2.5
|
|
|
$
|
1.6
|
|
|
$
|
1.0
|
|
|
60.5
|
%
|
Net income (loss) attributable to ARC
|
$
|
2.6
|
|
|
$
|
(14.8
|
)
|
|
$
|
17.3
|
|
|
(117.3
|
)%
|
|
$
|
7.3
|
|
|
$
|
(9.4
|
)
|
|
$
|
16.6
|
|
|
(177.6
|
)%
|
Non-GAAP
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Adjusted net income attributable to ARC
(2)
|
$
|
2.3
|
|
|
$
|
0.4
|
|
|
$
|
2.0
|
|
|
555.3
|
%
|
|
$
|
7.0
|
|
|
$
|
5.9
|
|
|
$
|
1.1
|
|
|
17.7
|
%
|
EBITDA
(2)
|
$
|
13.0
|
|
|
$
|
(7.0
|
)
|
|
$
|
20.0
|
|
|
(286.3
|
)%
|
|
$
|
38.9
|
|
|
$
|
21.9
|
|
|
$
|
16.9
|
|
|
77.2
|
%
|
Adjusted EBITDA
(2)
|
$
|
13.6
|
|
|
$
|
11.5
|
|
|
$
|
2.1
|
|
|
18.7
|
%
|
|
$
|
40.7
|
|
|
$
|
42.1
|
|
|
$
|
(1.4
|
)
|
|
(3.2
|
)%
|
(1)
|
Column does not foot due to rounding
|
(2)
|
See "Non-GAAP Financial Measures" on pg. 22 for additional information.
|
|
As Percentage of Net Sales
|
|
As Percentage of Net Sales
|
||||||||
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2018 (1)
|
|
2017 (1)
|
|
2018 (1)
|
|
2017 (1)
|
||||
Net Sales
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
67.5
|
|
|
69.7
|
|
|
67.4
|
|
|
68.2
|
|
Gross profit
|
32.5
|
|
|
30.3
|
|
|
32.6
|
|
|
31.8
|
|
Selling, general and administrative expenses
|
26.8
|
|
|
26.8
|
|
|
27.0
|
|
|
25.7
|
|
Amortization of intangibles
|
0.9
|
|
|
1.1
|
|
|
1.0
|
|
|
1.1
|
|
Goodwill impairment
|
—
|
|
|
18.3
|
|
|
—
|
|
|
5.9
|
|
Income (loss) from operations
|
4.7
|
|
|
(15.9
|
)
|
|
4.6
|
|
|
(1.0
|
)
|
Interest expense, net
|
1.5
|
|
|
1.6
|
|
|
1.5
|
|
|
1.6
|
|
Income before income tax provision (benefit)
|
3.2
|
|
|
(17.6
|
)
|
|
3.2
|
|
|
(2.6
|
)
|
Income tax provision (benefit)
|
0.6
|
|
|
(2.3
|
)
|
|
0.8
|
|
|
0.5
|
|
Net income (loss)
|
2.6
|
|
|
(15.3
|
)
|
|
2.3
|
|
|
(3.1
|
)
|
Loss (income) attributable to the noncontrolling interest
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
Net income (loss) attributable to ARC
|
2.5
|
%
|
|
(15.3
|
)%
|
|
2.4
|
%
|
|
(3.1
|
)%
|
Non-GAAP
(2)
|
|
|
|
|
|
|
|
||||
EBITDA
(2)
|
13.0
|
%
|
|
(7.2
|
)%
|
|
12.9
|
%
|
|
7.4
|
%
|
Adjusted EBITDA
(2)
|
13.6
|
%
|
|
11.9
|
%
|
|
13.5
|
%
|
|
14.1
|
%
|
(1)
|
Column does not foot due to rounding
|
(2)
|
See "Non-GAAP Financial Measures" on pg. 22 for additional information.
|
•
|
They do not reflect our cash expenditures, or future requirements for capital expenditures and contractual commitments;
|
•
|
They do not reflect changes in, or cash requirements for, our working capital needs;
|
•
|
They do not reflect the significant interest expense, or the cash requirements necessary, to service interest or principal payments on our debt;
|
•
|
Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements; and
|
•
|
Other companies, including companies in our industry, may calculate these measures differently than we do, limiting their usefulness as comparative measures.
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cash flows provided by operating activities
|
$
|
7,097
|
|
|
$
|
11,326
|
|
|
$
|
30,062
|
|
|
$
|
36,756
|
|
Changes in operating assets and liabilities
|
4,956
|
|
|
(959
|
)
|
|
6,340
|
|
|
1,406
|
|
||||
Non-cash expenses, including depreciation and amortization
|
(9,466
|
)
|
|
(25,134
|
)
|
|
(29,331
|
)
|
|
(47,461
|
)
|
||||
Income tax provision (benefit)
|
647
|
|
|
(2,174
|
)
|
|
2,526
|
|
|
1,574
|
|
||||
Interest expense, net
|
1,478
|
|
|
1,530
|
|
|
4,436
|
|
|
4,679
|
|
||||
(Income) loss attributable to the noncontrolling interest
|
(28
|
)
|
|
(7
|
)
|
|
190
|
|
|
(55
|
)
|
||||
Depreciation and amortization
|
8,338
|
|
|
8,430
|
|
|
24,650
|
|
|
25,037
|
|
||||
EBITDA
|
$
|
13,022
|
|
|
$
|
(6,988
|
)
|
|
$
|
38,873
|
|
|
$
|
21,936
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss) attributable to ARC Document Solutions, Inc.
|
$
|
2,559
|
|
|
$
|
(14,774
|
)
|
|
$
|
7,261
|
|
|
$
|
(9,354
|
)
|
Interest expense, net
|
1,478
|
|
|
1,530
|
|
|
4,436
|
|
|
4,679
|
|
||||
Income tax provision (benefit)
|
647
|
|
|
(2,174
|
)
|
|
2,526
|
|
|
1,574
|
|
||||
Depreciation and amortization
|
8,338
|
|
|
8,430
|
|
|
24,650
|
|
|
25,037
|
|
||||
EBITDA
|
13,022
|
|
|
(6,988
|
)
|
|
38,873
|
|
|
21,936
|
|
||||
Loss on extinguishment and modification of debt
|
—
|
|
|
124
|
|
|
—
|
|
|
230
|
|
||||
Goodwill impairment
|
—
|
|
|
17,637
|
|
|
—
|
|
|
17,637
|
|
||||
Stock-based compensation
|
597
|
|
|
699
|
|
|
1,824
|
|
|
2,251
|
|
||||
Adjusted EBITDA
|
$
|
13,619
|
|
|
$
|
11,472
|
|
|
$
|
40,697
|
|
|
$
|
42,054
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||
|
2018 (1)
|
|
2017 (1)
|
|
2018
|
|
2017 (1)
|
||||
Net income (loss) margin attributable to ARC Document Solutions, Inc.
|
2.5
|
%
|
|
(15.3
|
)%
|
|
2.4
|
%
|
|
(3.1
|
)%
|
Interest expense, net
|
1.5
|
|
|
1.6
|
|
|
1.5
|
|
|
1.6
|
|
Income tax provision (benefit)
|
0.6
|
|
|
(2.3
|
)
|
|
0.8
|
|
|
0.5
|
|
Depreciation and amortization
|
8.3
|
|
|
8.7
|
|
|
8.2
|
|
|
8.4
|
|
EBITDA margin
|
13.0
|
|
|
(7.2
|
)
|
|
12.9
|
|
|
7.4
|
|
Loss on extinguishment and modification of debt
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
Goodwill impairment
|
—
|
|
|
18.3
|
|
|
—
|
|
|
5.9
|
|
Stock-based compensation
|
0.6
|
|
|
0.7
|
|
|
0.6
|
|
|
0.8
|
|
Adjusted EBITDA margin
|
13.6
|
%
|
|
11.9
|
%
|
|
13.5
|
%
|
|
14.1
|
%
|
(1)
|
Column does not foot due to rounding
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In thousands, except per share amounts)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss) attributable to ARC Document Solutions, Inc.
|
$
|
2,559
|
|
|
$
|
(14,774
|
)
|
|
$
|
7,261
|
|
|
$
|
(9,354
|
)
|
Loss on extinguishment and modification of debt
|
—
|
|
|
124
|
|
|
—
|
|
|
230
|
|
||||
Goodwill impairment
|
—
|
|
|
17,637
|
|
|
—
|
|
|
17,637
|
|
||||
Income tax benefit related to above items
|
—
|
|
|
(3,144
|
)
|
|
—
|
|
|
(3,186
|
)
|
||||
Deferred tax valuation allowance and other discrete tax items
|
(213
|
)
|
|
515
|
|
|
(290
|
)
|
|
594
|
|
||||
Adjusted net income attributable to ARC Document Solutions, Inc.
|
$
|
2,346
|
|
|
$
|
358
|
|
|
$
|
6,971
|
|
|
$
|
5,921
|
|
|
|
|
|
|
|
|
|
||||||||
Actual:
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share attributable to ARC Document Solutions, Inc. shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.06
|
|
|
$
|
(0.32
|
)
|
|
$
|
0.16
|
|
|
$
|
(0.20
|
)
|
Diluted
|
$
|
0.06
|
|
|
$
|
(0.32
|
)
|
|
$
|
0.16
|
|
|
$
|
(0.20
|
)
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
44,983
|
|
|
45,834
|
|
|
44,888
|
|
|
45,756
|
|
||||
Diluted
|
45,188
|
|
|
45,834
|
|
|
44,993
|
|
|
45,756
|
|
||||
Adjusted:
|
|
|
|
|
|
|
|
||||||||
Earnings per share attributable to ARC Document Solutions, Inc. shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.05
|
|
|
$
|
0.01
|
|
|
$
|
0.16
|
|
|
$
|
0.13
|
|
Diluted
|
$
|
0.05
|
|
|
$
|
0.01
|
|
|
$
|
0.15
|
|
|
$
|
0.13
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
44,983
|
|
|
45,834
|
|
|
44,888
|
|
|
45,756
|
|
||||
Diluted
|
45,188
|
|
|
46,342
|
|
|
44,993
|
|
|
46,335
|
|
|
Nine Months Ended
September 30, |
||||||
(In thousands)
|
2018
|
|
2017
|
||||
Net cash provided by operating activities
|
$
|
30,062
|
|
|
$
|
36,756
|
|
Net cash used in investing activities
|
$
|
(9,907
|
)
|
|
$
|
(6,780
|
)
|
Net cash used in financing activities
|
$
|
(28,961
|
)
|
|
$
|
(29,343
|
)
|
(In thousands)
|
September 30, 2018
|
|
December 31, 2017
|
||||
Cash and cash equivalents
|
$
|
18,404
|
|
|
$
|
28,059
|
|
Working capital
|
$
|
35,676
|
|
|
$
|
39,583
|
|
|
|
|
|
||||
Borrowings from credit agreement
(1) (2)
|
$
|
84,395
|
|
|
$
|
99,243
|
|
Other debt obligations
|
47,828
|
|
|
45,174
|
|
||
Total debt obligations
|
$
|
132,223
|
|
|
$
|
144,417
|
|
(Dollars in thousands)
|
Number of
Reporting
Units
|
|
Representing
Goodwill of
|
|||
No goodwill balance
|
6
|
|
|
$
|
—
|
|
Fair value of reporting units exceeds their carrying values by more than 100%
|
2
|
|
|
121,051
|
|
|
|
8
|
|
|
$
|
121,051
|
|
•
|
Future reversals of existing taxable temporary differences;
|
•
|
Future taxable income exclusive of reversing temporary differences and carryforwards;
|
•
|
Taxable income in prior carryback years; and
|
•
|
Tax-planning strategies.
|
•
|
Nature, frequency, and severity of recent losses;
|
•
|
Duration of statutory carryforward periods;
|
•
|
Historical experience with tax attributes expiring unused; and
|
•
|
Near- and medium-term financial outlook.
|
Exhibit
Number
|
|
Description
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document *
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema *
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase *
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase *
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase *
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase *
|
*
|
Filed herewith
|
ARC DOCUMENT SOLUTIONS, INC.
|
|
/s/ KUMARAKULASINGAM SURIYAKUMAR
|
Kumarakulasingam Suriyakumar
|
Chairman, President and Chief Executive Officer
|
|
/s/ JORGE AVALOS
|
Jorge Avalos
|
Chief Financial Officer
|
Exhibit
Number
|
|
Description
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document *
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema *
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase *
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase *
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase *
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase *
|
*
|
Filed herewith
|
1 Year ARC Document Solutions Chart |
1 Month ARC Document Solutions 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