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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Charah Solutions Inc | NYSE:CHRA | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 2.17 | 0 | 01:00:00 |
|
Delaware
|
82-4228671
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
Title of each class
|
|
Trading symbol(s)
|
|
Name of each exchange on which registered
|
Common Stock, par value $0.01 per share
|
|
CHRA
|
|
New York Stock Exchange
|
Large accelerated filer
¨
|
|
|
|
Accelerated filer
¨
|
Non-accelerated filer
x
|
|
|
|
Smaller reporting company
¨
|
|
|
|
|
Emerging growth company
x
|
|
|
Page
|
|
|
|
|
|
|
•
|
our business strategy;
|
•
|
our operating cash flows, the availability of capital and our liquidity;
|
•
|
our future revenue, income and operating performance;
|
•
|
our ability to sustain and improve our utilization, revenues and margins;
|
•
|
our ability to maintain acceptable pricing for our services;
|
•
|
our future capital expenditures;
|
•
|
our ability to finance equipment, working capital and capital expenditures;
|
•
|
competition and government regulations;
|
•
|
our ability to obtain permits and governmental approvals;
|
•
|
pending legal or environmental matters or liabilities;
|
•
|
environmental hazards;
|
•
|
industrial accidents;
|
•
|
business or asset acquisitions;
|
•
|
general economic conditions;
|
•
|
credit markets;
|
•
|
our ability to successfully develop our research and technology capabilities and to implement technological developments and enhancements;
|
•
|
uncertainty regarding our future operating results; and
|
•
|
plans, objectives, expectations and intentions contained in this Quarterly Report that are not historical.
|
|
June 30,
2019 |
|
December 31, 2018
|
||||
|
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash
|
$
|
9,581
|
|
|
$
|
6,900
|
|
Trade accounts receivable
|
47,706
|
|
|
60,742
|
|
||
Receivable from affiliates
|
828
|
|
|
894
|
|
||
Costs and estimated earnings in excess of billings
|
90,375
|
|
|
86,710
|
|
||
Inventory
|
22,306
|
|
|
25,797
|
|
||
Prepaid expenses and other current assets
|
3,946
|
|
|
5,133
|
|
||
Total current assets
|
174,742
|
|
|
186,176
|
|
||
Property and equipment:
|
|
|
|
||||
Plant, machinery and equipment
|
73,482
|
|
|
74,896
|
|
||
Structural fill site improvements
|
55,760
|
|
|
55,760
|
|
||
Vehicles
|
19,726
|
|
|
17,407
|
|
||
Office equipment
|
2,322
|
|
|
1,623
|
|
||
Buildings and leasehold improvements
|
262
|
|
|
262
|
|
||
Structural fill sites
|
7,110
|
|
|
7,110
|
|
||
Construction in progress
|
9,596
|
|
|
3,488
|
|
||
Total property and equipment
|
168,258
|
|
|
160,546
|
|
||
Less accumulated depreciation
|
(80,969
|
)
|
|
(71,605
|
)
|
||
Property and equipment, net
|
87,289
|
|
|
88,941
|
|
||
Other assets:
|
|
|
|
||||
Trade names, net
|
34,850
|
|
|
34,920
|
|
||
Customer relationships, net
|
59,951
|
|
|
63,898
|
|
||
Technology, net
|
1,753
|
|
|
1,853
|
|
||
Non-compete and other agreements, net
|
108
|
|
|
180
|
|
||
Other intangible assets, net
|
—
|
|
|
22
|
|
||
Goodwill
|
74,213
|
|
|
74,213
|
|
||
Other assets
|
—
|
|
|
891
|
|
||
Deferred tax asset
|
9,136
|
|
|
2,747
|
|
||
Equity method investments
|
5,218
|
|
|
5,060
|
|
||
Total assets
|
$
|
447,260
|
|
|
$
|
458,901
|
|
|
June 30,
2019 |
|
December 31, 2018
|
||||
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
29,273
|
|
|
$
|
24,821
|
|
Billings in excess of costs and estimated earnings
|
160
|
|
|
1,352
|
|
||
Notes payable, current maturities
|
108,722
|
|
|
23,268
|
|
||
Accrued payroll and bonuses
|
11,588
|
|
|
15,480
|
|
||
Asset retirement obligation, current portion
|
14,126
|
|
|
14,704
|
|
||
Purchase option liability
|
7,110
|
|
|
10,017
|
|
||
Accrued expenses
|
20,628
|
|
|
22,473
|
|
||
Other liabilities
|
905
|
|
|
—
|
|
||
Total current liabilities
|
192,512
|
|
|
112,115
|
|
||
Long-term liabilities:
|
|
|
|
||||
Contingent payments for acquisitions
|
11,349
|
|
|
11,214
|
|
||
Asset retirement obligation, less current portion
|
6,819
|
|
|
11,361
|
|
||
Line of credit
|
35,174
|
|
|
19,799
|
|
||
Notes payable, less current maturities
|
127,837
|
|
|
211,022
|
|
||
Total liabilities
|
373,691
|
|
|
365,511
|
|
||
Commitments and contingencies (see Note 11)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Retained (losses) earnings
|
(11,431
|
)
|
|
9,414
|
|
||
Common Stock, $0.01 par value; 200,000,000 shares authorized; 29,586,165 and 29,082,988 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively
|
296
|
|
|
291
|
|
||
Additional paid-in capital
|
83,681
|
|
|
82,880
|
|
||
Total stockholders’ equity
|
72,546
|
|
|
92,585
|
|
||
Non-controlling interest
|
1,023
|
|
|
805
|
|
||
Total equity
|
73,569
|
|
|
93,390
|
|
||
Total liabilities and equity
|
$
|
447,260
|
|
|
$
|
458,901
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
|
June 30, 2019
|
|
June 30, 2018
|
||||||||
Revenue
|
$
|
120,936
|
|
|
$
|
195,723
|
|
|
$
|
284,194
|
|
|
$
|
351,252
|
|
Cost of sales
|
123,001
|
|
|
165,174
|
|
|
270,880
|
|
|
301,605
|
|
||||
Gross (loss) profit
|
(2,065
|
)
|
|
30,549
|
|
|
13,314
|
|
|
49,647
|
|
||||
General and administrative expenses
|
17,400
|
|
|
18,937
|
|
|
31,385
|
|
|
33,319
|
|
||||
Operating (loss) income
|
(19,465
|
)
|
|
11,612
|
|
|
(18,071
|
)
|
|
16,328
|
|
||||
Interest expense, net
|
(4,102
|
)
|
|
(5,543
|
)
|
|
(9,154
|
)
|
|
(9,674
|
)
|
||||
Income from equity method investment
|
663
|
|
|
699
|
|
|
1,217
|
|
|
1,286
|
|
||||
(Loss) income before income taxes
|
(22,904
|
)
|
|
6,768
|
|
|
(26,008
|
)
|
|
7,940
|
|
||||
Income tax provision
|
(5,628
|
)
|
|
2,906
|
|
|
(6,389
|
)
|
|
2,906
|
|
||||
Net (loss) income
|
(17,276
|
)
|
|
3,862
|
|
|
(19,619
|
)
|
|
5,034
|
|
||||
Less income attributable to non-controlling interest
|
750
|
|
|
642
|
|
|
1,226
|
|
|
1,009
|
|
||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(18,026
|
)
|
|
$
|
3,220
|
|
|
$
|
(20,845
|
)
|
|
$
|
4,025
|
|
|
|
|
|
|
|
|
|
||||||||
(Loss) earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.61
|
)
|
|
$
|
0.13
|
|
|
$
|
(0.71
|
)
|
|
$
|
0.17
|
|
Diluted
|
$
|
(0.61
|
)
|
|
$
|
0.13
|
|
|
$
|
(0.71
|
)
|
|
$
|
0.16
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average shares outstanding used in (loss) earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
29,558,752
|
|
|
24,477,829
|
|
|
29,374,295
|
|
|
24,096,186
|
|
||||
Diluted
|
29,558,752
|
|
|
25,347,887
|
|
|
29,374,295
|
|
|
24,942,199
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Pro forma net (loss) income information (see Note 1):
|
|
|
|||||||||||||
Net (loss) income attributable to Charah Solutions, Inc. before provision for income taxes
|
$
|
(23,654
|
)
|
|
$
|
6,126
|
|
|
$
|
(27,234
|
)
|
|
$
|
6,931
|
|
Pro forma provision for income taxes
|
(5,628
|
)
|
|
1,517
|
|
|
(6,389
|
)
|
|
1,720
|
|
||||
Pro forma net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(18,026
|
)
|
|
$
|
4,609
|
|
|
$
|
(20,845
|
)
|
|
$
|
5,211
|
|
|
|
For the Three Months Ended June 30, 2019
|
|||||||||||||||||||||||||
|
|
Charah Solutions, Inc.
|
|||||||||||||||||||||||||
|
|
Common Stock (Shares)
|
|
Common Stock (Amount)
|
|
Additional Paid-In Capital
|
|
Retained
Earnings (Losses)
|
|
Total
|
|
Non-Controlling
Interest
|
|
Total
|
|||||||||||||
Balance, March 31, 2019
|
|
29,554,588
|
|
|
$
|
296
|
|
|
$
|
83,083
|
|
|
$
|
6,595
|
|
|
$
|
89,974
|
|
|
$
|
699
|
|
|
$
|
90,673
|
|
Net (loss) income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,026
|
)
|
|
(18,026
|
)
|
|
750
|
|
|
(17,276
|
)
|
||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(426
|
)
|
|
(426
|
)
|
||||||
Share-based compensation expense
|
|
—
|
|
|
—
|
|
|
799
|
|
|
—
|
|
|
799
|
|
|
—
|
|
|
799
|
|
||||||
Shares issued under share-based compensation plans
|
|
31,577
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Shares repurchases
|
|
—
|
|
|
—
|
|
|
(201
|
)
|
|
—
|
|
|
(201
|
)
|
|
—
|
|
|
(201
|
)
|
||||||
Balance, June 30, 2019
|
|
29,586,165
|
|
|
$
|
296
|
|
|
$
|
83,681
|
|
|
$
|
(11,431
|
)
|
|
$
|
72,546
|
|
|
$
|
1,023
|
|
|
$
|
73,569
|
|
|
|
For the Three Months Ended June 30, 2018
|
|||||||||||||||||||||||||||||||||
|
|
Charah Solutions, Inc.
|
|||||||||||||||||||||||||||||||||
|
|
Common Stock (Shares)
|
|
Common Stock (Amount)
|
|
Additional Paid-In Capital
|
|
Charah, LLC Members' Interest
|
|
Allied Power Management, LLC Members' Interest
|
|
Retained
Earnings
|
|
Total
|
|
Non-Controlling
Interest
|
|
Total
|
|||||||||||||||||
Balance, March 31, 2018
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19,828
|
|
|
$
|
9,687
|
|
|
$
|
19,121
|
|
|
$
|
48,636
|
|
|
$
|
582
|
|
|
$
|
49,218
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,220
|
|
|
3,220
|
|
|
642
|
|
|
3,862
|
|
||||||||
Share based compensation expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
104
|
|
|
—
|
|
|
—
|
|
|
104
|
|
|
—
|
|
|
104
|
|
||||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(686
|
)
|
|
—
|
|
|
—
|
|
|
(686
|
)
|
|
(338
|
)
|
|
(1,024
|
)
|
||||||||
Conversion from members' interest to common stock
|
|
23,436,398
|
|
|
234
|
|
|
28,699
|
|
|
(19,246
|
)
|
|
(9,687
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Issuance of shares
|
|
5,294,117
|
|
|
53
|
|
|
59,188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59,241
|
|
|
—
|
|
|
59,241
|
|
||||||||
Share based common stock issued
|
|
372,169
|
|
|
4
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Shares repurchased
|
|
(19,696
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Share based compensation expense
|
|
—
|
|
|
—
|
|
|
1,189
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,189
|
|
|
—
|
|
|
1,189
|
|
||||||||
Deferred offering costs
|
|
—
|
|
|
—
|
|
|
(8,622
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,622
|
)
|
|
—
|
|
|
(8,622
|
)
|
||||||||
Balance, June 30, 2018
|
|
29,082,988
|
|
|
$
|
291
|
|
|
$
|
80,450
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22,341
|
|
|
$
|
103,082
|
|
|
$
|
886
|
|
|
$
|
103,968
|
|
|
|
For the Six Months Ended June 30, 2019
|
|||||||||||||||||||||||||
|
|
Charah Solutions, Inc.
|
|||||||||||||||||||||||||
|
|
Common Stock (Shares)
|
|
Common Stock (Amount)
|
|
Additional Paid-In Capital
|
|
Retained
Earnings (Losses)
|
|
Total
|
|
Non-Controlling
Interest
|
|
Total
|
|||||||||||||
Balance, December 31, 2018
|
|
29,082,988
|
|
|
$
|
291
|
|
|
$
|
82,880
|
|
|
$
|
9,414
|
|
|
$
|
92,585
|
|
|
$
|
805
|
|
|
$
|
93,390
|
|
Net (loss) income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,845
|
)
|
|
(20,845
|
)
|
|
1,226
|
|
|
(19,619
|
)
|
||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,008
|
)
|
|
(1,008
|
)
|
||||||
Share-based compensation expense
|
|
—
|
|
|
—
|
|
|
1,007
|
|
|
—
|
|
|
1,007
|
|
|
—
|
|
|
1,007
|
|
||||||
Shares issued under share-based compensation plans
|
|
531,830
|
|
|
5
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Shares repurchases
|
|
(28,653
|
)
|
|
—
|
|
|
(201
|
)
|
|
—
|
|
|
(201
|
)
|
|
—
|
|
|
(201
|
)
|
||||||
Balance, June 30, 2019
|
|
29,586,165
|
|
|
$
|
296
|
|
|
$
|
83,681
|
|
|
$
|
(11,431
|
)
|
|
$
|
72,546
|
|
|
$
|
1,023
|
|
|
$
|
73,569
|
|
|
|
For the Six Months Ended June 30, 2018
|
|||||||||||||||||||||||||||||||||
|
|
Charah Solutions, Inc.
|
|||||||||||||||||||||||||||||||||
|
|
Common Stock (Shares)
|
|
Common Stock (Amount)
|
|
Additional Paid-In Capital
|
|
Charah, LLC Members' Interest
|
|
Allied Power Management, LLC Members' Interest
|
|
Retained
Earnings
|
|
Total
|
|
Non-Controlling
Interest
|
|
Total
|
|||||||||||||||||
Balance, December 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19,718
|
|
|
$
|
9,687
|
|
|
$
|
18,316
|
|
|
$
|
47,721
|
|
|
$
|
598
|
|
|
$
|
48,319
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,025
|
|
|
4,025
|
|
|
1,009
|
|
|
5,034
|
|
||||||||
Share based compensation expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
214
|
|
|
—
|
|
|
—
|
|
|
214
|
|
|
—
|
|
|
214
|
|
||||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(686
|
)
|
|
—
|
|
|
—
|
|
|
(686
|
)
|
|
(721
|
)
|
|
(1,407
|
)
|
||||||||
Conversion from members' interest to common stock
|
|
23,436,398
|
|
|
234
|
|
|
28,699
|
|
|
(19,246
|
)
|
|
(9,687
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Issuance of shares
|
|
5,294,117
|
|
|
53
|
|
|
59,188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59,241
|
|
|
—
|
|
|
59,241
|
|
||||||||
Share based common stock issued
|
|
372,169
|
|
|
4
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Shares repurchased
|
|
(19,696
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Share based compensation expense
|
|
—
|
|
|
—
|
|
|
1,189
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,189
|
|
|
—
|
|
|
1,189
|
|
||||||||
Deferred offering costs
|
|
—
|
|
|
—
|
|
|
(8,622
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,622
|
)
|
|
—
|
|
|
(8,622
|
)
|
||||||||
Balance, June 30, 2018
|
|
29,082,988
|
|
|
$
|
291
|
|
|
$
|
80,450
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22,341
|
|
|
$
|
103,082
|
|
|
$
|
886
|
|
|
$
|
103,968
|
|
|
Six Months Ended
|
||||||
|
June 30, 2019
|
|
June 30, 2018
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net (loss) income
|
$
|
(19,619
|
)
|
|
$
|
5,034
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
11,635
|
|
|
17,135
|
|
||
Amortization of debt issuance costs
|
342
|
|
|
784
|
|
||
Deferred income tax provision
|
(6,389
|
)
|
|
1,919
|
|
||
Loss on sale of assets
|
1,305
|
|
|
582
|
|
||
Income from equity method investment
|
(1,217
|
)
|
|
(1,286
|
)
|
||
Distributions received from equity investment
|
1,059
|
|
|
938
|
|
||
Non-cash share-based compensation
|
1,007
|
|
|
1,403
|
|
||
Loss (gain) on interest rate swap
|
1,796
|
|
|
(2,228
|
)
|
||
Interest accreted on contingent earnout liability
|
135
|
|
|
—
|
|
||
Changes in cash due to changes in:
|
|
|
|
||||
Trade accounts receivable
|
13,036
|
|
|
(5,289
|
)
|
||
Receivable from affiliates
|
66
|
|
|
(82
|
)
|
||
Costs and estimated earnings in excess of billings
|
(3,665
|
)
|
|
(22,305
|
)
|
||
Inventory
|
3,491
|
|
|
(825
|
)
|
||
Prepaid expenses and other current assets
|
1,187
|
|
|
(2,126
|
)
|
||
Accounts payable
|
4,452
|
|
|
8,587
|
|
||
Billings in excess of costs and estimated earnings
|
(1,192
|
)
|
|
(8,783
|
)
|
||
Accrued payroll and bonuses
|
(3,892
|
)
|
|
1,946
|
|
||
Asset retirement obligation
|
(5,120
|
)
|
|
14
|
|
||
Accrued expenses
|
(1,845
|
)
|
|
2,396
|
|
||
Net cash used in operating activities
|
(3,428
|
)
|
|
(2,186
|
)
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
||||
Proceeds from the sale of equipment
|
1,507
|
|
|
1,102
|
|
||
Purchases of property and equipment
|
(11,491
|
)
|
|
(8,233
|
)
|
||
Payments for business acquisitions, net of cash received
|
—
|
|
|
(19,983
|
)
|
||
Purchase of intangible assets
|
—
|
|
|
(31
|
)
|
||
Net cash used in investing activities
|
(9,984
|
)
|
|
(27,145
|
)
|
|
Six Months Ended
|
||||||
|
June 30, 2019
|
|
June 30, 2018
|
||||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
||||
Net proceeds on line of credit
|
15,375
|
|
|
—
|
|
||
Proceeds from long-term debt
|
9,994
|
|
|
8,400
|
|
||
Principal payments on long-term debt
|
(8,067
|
)
|
|
(45,547
|
)
|
||
Repurchases of shares
|
(201
|
)
|
|
—
|
|
||
Payments of offering costs
|
—
|
|
|
(8,622
|
)
|
||
Issuance of common stock
|
—
|
|
|
59,241
|
|
||
Distributions to non-controlling interest
|
(1,008
|
)
|
|
(721
|
)
|
||
Distributions to members
|
—
|
|
|
(686
|
)
|
||
Net cash provided by financing activities
|
16,093
|
|
|
12,065
|
|
||
Net increase (decrease) in cash
|
2,681
|
|
|
(17,266
|
)
|
||
Cash, beginning of period
|
6,900
|
|
|
32,264
|
|
||
Cash, end of period
|
$
|
9,581
|
|
|
$
|
14,998
|
|
|
|
|
|
||||
Supplemental disclosures of cash flow information:
|
|
|
|
||||
Cash paid during the year for interest
|
$
|
4,889
|
|
|
$
|
11,163
|
|
Cash paid during the year for taxes
|
$
|
—
|
|
|
$
|
—
|
|
Cash acquired
|
$
|
17
|
|
Net working capital, excluding cash
|
21,255
|
|
|
Property, plant and equipment
|
5,300
|
|
|
Trade name intangible assets
|
694
|
|
|
Customer relationship intangible assets
|
742
|
|
|
Technology
|
1,972
|
|
|
Non-compete and other agreements
|
289
|
|
|
Goodwill
|
745
|
|
|
Total purchase price
|
$
|
31,014
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
|
June 30, 2019
|
|
June 30, 2018
|
||||||||
Pro forma revenue
|
$
|
120,936
|
|
|
$
|
195,723
|
|
|
$
|
284,194
|
|
|
$
|
368,075
|
|
Pro forma net (loss) income attributable to Charah Solutions, Inc.
|
(18,026
|
)
|
|
3,381
|
|
|
(20,845
|
)
|
|
4,811
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Current assets
|
$
|
2,834
|
|
|
$
|
2,619
|
|
Noncurrent assets
|
451
|
|
|
508
|
|
||
Total assets
|
$
|
3,285
|
|
|
$
|
3,127
|
|
Current liabilities
|
449
|
|
|
607
|
|
||
Equity of Charah
|
5,218
|
|
|
5,060
|
|
||
Equity of joint venture partner
|
(2,382
|
)
|
|
(2,540
|
)
|
||
Total liabilities and members’ equity
|
$
|
3,285
|
|
|
$
|
3,127
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
|
June 30, 2019
|
|
June 30, 2018
|
||||||||
Revenues
|
$
|
2,533
|
|
|
$
|
2,664
|
|
|
$
|
4,753
|
|
|
$
|
5,029
|
|
Net income
|
1,325
|
|
|
1,397
|
|
|
2,433
|
|
|
2,572
|
|
||||
Charah Solutions’ share of net income
|
663
|
|
|
699
|
|
|
1,217
|
|
|
1,286
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
|
June 30, 2019
|
|
June 30, 2018
|
||||||||
Opening balance
|
$
|
5,102
|
|
|
$
|
5,342
|
|
|
$
|
5,060
|
|
|
$
|
5,006
|
|
Distributions
|
(547
|
)
|
|
(687
|
)
|
|
(1,059
|
)
|
|
(938
|
)
|
||||
Share of net income
|
663
|
|
|
699
|
|
|
1,217
|
|
|
1,286
|
|
||||
Closing balance
|
$
|
5,218
|
|
|
$
|
5,354
|
|
|
$
|
5,218
|
|
|
$
|
5,354
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Gross Carrying Amount
|
|
Accumulated
Amortization
|
|
Gross Carrying Amount
|
|
Accumulated
Amortization
|
||||||||
Definite-lived intangibles
|
|
|
|
|
|
|
|
||||||||
Customer relationships
|
$
|
78,942
|
|
|
$
|
(18,991
|
)
|
|
$
|
78,942
|
|
|
$
|
(15,044
|
)
|
Technology
|
2,003
|
|
|
(250
|
)
|
|
2,003
|
|
|
(150
|
)
|
||||
Non-compete and other agreements
|
289
|
|
|
(181
|
)
|
|
289
|
|
|
(109
|
)
|
||||
SCB trade name
|
694
|
|
|
(174
|
)
|
|
694
|
|
|
(104
|
)
|
||||
Rail easement
|
110
|
|
|
(110
|
)
|
|
110
|
|
|
(88
|
)
|
||||
Total
|
$
|
82,038
|
|
|
$
|
(19,706
|
)
|
|
$
|
82,038
|
|
|
$
|
(15,495
|
)
|
|
|
|
|
|
|
|
|
||||||||
Indefinite-lived intangibles
|
|
|
|
|
|
|
|
||||||||
Charah trade name
|
$
|
34,330
|
|
|
|
|
$
|
34,330
|
|
|
|
||||
Goodwill
|
74,213
|
|
|
|
|
74,213
|
|
|
|
||||||
Total
|
$
|
108,543
|
|
|
|
|
$
|
108,543
|
|
|
|
Definite-Lived Intangible Asset
|
|
Useful Life
|
Customer relationships
|
|
10 years
|
Technology
|
|
10 years
|
Non-compete and other agreements
|
|
2 years
|
SCB trade name
|
|
5 years
|
Rail easement
|
|
2 years
|
|
Approximate Percent Decrease in Estimated Fair Value
|
||||
|
+75 bps Discount Rate
|
|
-100 bps Growth Rate
|
||
Environmental Solutions reporting unit
|
6.5
|
%
|
|
5.7
|
%
|
•
|
a commitment to loan up to a further
$25,000
in term loans, which expires in March 2020 (the “Delayed Draw Commitment” and the term loans funded under such Delayed Draw Commitment, the “Delayed Draw Term Loan”, together with the Closing Date Term Loan, the “Term Loan”).
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
Various equipment notes entered into in November 2017, payable in monthly installments ranging from $5 to $24, including interest at 5.2%, maturing in December 2022 through December 2023. The notes are secured by equipment with a net book value of $3,931 as of June 30, 2019.
|
$
|
4,450
|
|
|
$
|
4,949
|
|
Various equipment notes entered into in 2018, payable in monthly installments ranging from $1 to $39, including interest ranging from 5.61% to 6.80%, maturing in March 2023 through May 2025. The notes are secured by equipment with a net book value of $10,779 as of June 30, 2019.
|
11,375
|
|
|
12,293
|
|
||
Various equipment notes entered into in 2019, payable in monthly installments of $3, including interest of 4.7%, maturing in May 2021 through March 2024. The notes are secured by equipment with a net book value of $249 as of June 30, 2019.
|
252
|
|
|
—
|
|
||
In June 2018, the Company entered into a $12,000 convertible, non-revolving credit note with a bank. The credit note converted to a term loan on April 10, 2019, with a maturity date of April 10, 2024. Interest on borrowings subsequent to the conversion date is calculated at a fixed rate per annum equal to 4.44%. The note is secured by equipment with a net book value of $10,642 as of June 30, 2019.
|
11,400
|
|
|
8,299
|
|
||
In April 2019, the Company entered into a $4,000 convertible, non-revolving credit note with a bank. The credit note will convert to a term loan on August 25, 2019, with a maturity date of July 24, 2024. Interest on borrowings is calculated at a fixed rate per annum equal to 4.64%. The note is secured by equipment with a net book value of $999 as of June 30, 2019.
|
1,029
|
|
|
—
|
|
||
A $10,000 equipment line with a bank, entered into in December 2017, secured by all equipment purchased with the proceeds of the loan. Interest is calculated on any outstanding amounts using a fixed rate of 4.5%. The equipment line converted to a term loan in September 2018, with a maturity date of June 22, 2023. The note is secured by equipment with a net book value of $7,566 as of June 30, 2019.
|
8,650
|
|
|
9,563
|
|
||
The Closing Date Term Loan and Delayed Draw Term Loan entered into in September 2018 as part of the Credit Facility (see Note 6). The interest rate applicable to the Closing Date Term Loan and Delayed Draw Term Loan is based on a fluctuating rate of interest measured by reference to, at the Company’s election, either (i) the Eurodollar rate, currently LIBOR, or (ii) an alternative base rate. Principal payments required are $52,563 in September 2019, $2,563 in December 2019, $42,625 in March 2020, $2,625 quarterly through September 2020, $3,938 quarterly through September 2022 and $5,250 quarterly through September 2023. The remaining outstanding amounts will be due in September 2023. The loan is secured by substantially all of the assets of the Company, and is subject to certain financial covenants.
|
202,313
|
|
|
202,438
|
|
||
Total
|
239,469
|
|
|
237,542
|
|
||
Less debt issuance costs
|
(2,910
|
)
|
|
(3,252
|
)
|
||
|
236,559
|
|
|
234,290
|
|
||
Less current maturities
|
(108,722
|
)
|
|
(23,268
|
)
|
||
Notes payable due after one year
|
$
|
127,837
|
|
|
$
|
211,022
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Costs incurred on uncompleted contracts
|
$
|
369,753
|
|
|
$
|
314,700
|
|
Estimated earnings
|
84,624
|
|
|
96,176
|
|
||
Total costs and estimated earnings
|
454,377
|
|
|
410,876
|
|
||
Less billings to date
|
(364,162
|
)
|
|
(325,518
|
)
|
||
Costs and estimated earnings in excess of billings
|
$
|
90,215
|
|
|
$
|
85,358
|
|
|
June 30,
2019 |
|
December 31,
2018 |
||||
Costs and estimated earnings in excess of billings
|
$
|
90,375
|
|
|
$
|
86,710
|
|
Billings in excess of costs and estimated earnings
|
(160
|
)
|
|
(1,352
|
)
|
||
Net balance in process
|
$
|
90,215
|
|
|
$
|
85,358
|
|
|
|
Shares
|
|
Weighted-Average Fair Value
|
|
Weighted-Average Remaining Contractual Terms (Years)
|
|
Aggregate Intrinsic Value
|
|||||
Outstanding as of December 31, 2018
|
|
1,198,703
|
|
|
$
|
11.84
|
|
|
0.77
|
|
$
|
10,009
|
|
Granted
|
|
1,086,083
|
|
|
5.95
|
|
|
|
|
|
|||
Forfeited
|
|
(187,327
|
)
|
|
11.21
|
|
|
|
|
|
|||
Vested
|
|
(531,830
|
)
|
|
10.69
|
|
|
|
|
|
|||
Outstanding as of June 30, 2019
|
|
1,565,629
|
|
|
$
|
7.13
|
|
|
1.73
|
|
$
|
8,611
|
|
Three Months Ended June 30, 2019
|
Environmental Solutions
|
|
Maintenance and Technical Services
|
|
All
Other
|
|
Total
|
||||||||
Segment revenue
|
$
|
36,950
|
|
|
$
|
83,986
|
|
|
$
|
—
|
|
|
$
|
120,936
|
|
Segment gross (loss) profit
|
(9,188
|
)
|
|
7,123
|
|
|
—
|
|
|
(2,065
|
)
|
||||
Segment depreciation and amortization expense
|
1,376
|
|
|
2,012
|
|
|
1,990
|
|
|
5,378
|
|
Three Months Ended June 30, 2018
|
Environmental Solutions
|
|
Maintenance and Technical Services
|
|
All
Other
|
|
Total
|
||||||||
Segment revenue
|
$
|
90,113
|
|
|
$
|
105,610
|
|
|
$
|
—
|
|
|
$
|
195,723
|
|
Segment gross profit
|
22,096
|
|
|
8,453
|
|
|
—
|
|
|
30,549
|
|
||||
Segment depreciation and amortization expense
|
5,334
|
|
|
1,378
|
|
|
1,992
|
|
|
8,704
|
|
Six Months Ended June 30, 2019
|
Environmental Solutions
|
|
Maintenance and Technical Services
|
|
All
Other
|
|
Total
|
||||||||
Segment revenue
|
$
|
95,333
|
|
|
$
|
188,861
|
|
|
$
|
—
|
|
|
$
|
284,194
|
|
Segment gross (loss) profit
|
(921
|
)
|
|
14,235
|
|
|
—
|
|
|
13,314
|
|
||||
Segment depreciation and amortization expense
|
3,690
|
|
|
3,966
|
|
|
3,979
|
|
|
11,635
|
|
||||
Expenditures for segment assets
|
6,957
|
|
|
4,502
|
|
|
32
|
|
|
11,491
|
|
Six Months Ended June 30, 2018
|
Environmental Solutions
|
|
Maintenance and Technical Services
|
|
All
Other
|
|
Total
|
||||||||
Segment revenue
|
$
|
137,897
|
|
|
$
|
213,355
|
|
|
$
|
—
|
|
|
$
|
351,252
|
|
Segment gross profit
|
34,565
|
|
|
15,082
|
|
|
—
|
|
|
49,647
|
|
||||
Segment depreciation and amortization expense
|
10,744
|
|
|
2,407
|
|
|
3,984
|
|
|
17,135
|
|
||||
Expenditures for segment assets
|
3,445
|
|
|
4,788
|
|
|
—
|
|
|
8,233
|
|
As of June 30, 2019
|
Environmental Solutions
|
|
Maintenance and Technical Services
|
|
All
Other
|
|
Total
|
||||||||
Segment property and equipment, net
|
$
|
48,578
|
|
|
$
|
38,430
|
|
|
$
|
281
|
|
|
$
|
87,289
|
|
Segment goodwill
|
57,591
|
|
|
16,622
|
|
|
—
|
|
|
74,213
|
|
As of December 31, 2018
|
Environmental Solutions
|
|
Maintenance and Technical Services
|
|
All
Other
|
|
Total
|
||||||||
Segment property and equipment, net
|
$
|
47,467
|
|
|
$
|
41,155
|
|
|
$
|
319
|
|
|
$
|
88,941
|
|
Segment goodwill
|
57,591
|
|
|
16,622
|
|
|
—
|
|
|
74,213
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
|
June 30, 2019
|
|
June 30, 2018
|
||||||||
Segment gross (loss) profit
|
$
|
(2,065
|
)
|
|
$
|
30,549
|
|
|
$
|
13,314
|
|
|
$
|
49,647
|
|
General and administrative expenses
|
(17,400
|
)
|
|
(18,937
|
)
|
|
(31,385
|
)
|
|
(33,319
|
)
|
||||
Interest expense, net
|
(4,102
|
)
|
|
(5,543
|
)
|
|
(9,154
|
)
|
|
(9,674
|
)
|
||||
Income from equity method investment
|
663
|
|
|
699
|
|
|
1,217
|
|
|
1,286
|
|
||||
Income tax provision
|
5,628
|
|
|
(2,906
|
)
|
|
6,389
|
|
|
(2,906
|
)
|
||||
Net (loss) income
|
$
|
(17,276
|
)
|
|
$
|
3,862
|
|
|
$
|
(19,619
|
)
|
|
$
|
5,034
|
|
|
As of June 30, 2019
|
|
As of December 31, 2018
|
||||
Segment property and equipment, net
|
$
|
87,289
|
|
|
$
|
88,941
|
|
Segment goodwill
|
74,213
|
|
|
74,213
|
|
||
Non-segment assets
|
285,758
|
|
|
295,747
|
|
||
Total assets
|
$
|
447,260
|
|
|
$
|
458,901
|
|
Three Months Ended June 30, 2019
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
24,890
|
|
|
$
|
11,900
|
|
|
$
|
84,146
|
|
|
$
|
120,936
|
|
Three Months Ended June 30, 2018
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
27,401
|
|
|
$
|
60,969
|
|
|
$
|
107,353
|
|
|
$
|
195,723
|
|
Six Months Ended June 30, 2019
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
47,402
|
|
|
$
|
46,207
|
|
|
$
|
190,585
|
|
|
$
|
284,194
|
|
Six Months Ended June 30, 2018
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
31,566
|
|
|
$
|
102,652
|
|
|
$
|
217,034
|
|
|
$
|
351,252
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2019
|
|
June 30, 2018
|
|
June 30, 2019
|
|
June 30, 2018
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(18,026
|
)
|
|
$
|
3,220
|
|
|
$
|
(20,845
|
)
|
|
$
|
4,025
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator (in thousands):
|
|
|
|
|
|
|
|
||||||||
Weighted-average shares outstanding
|
29,559
|
|
|
24,478
|
|
|
29,374
|
|
|
24,096
|
|
||||
Dilutive share-based awards
|
—
|
|
|
870
|
|
|
—
|
|
|
846
|
|
||||
Total weighted-average shares outstanding, including dilutive shares
|
29,559
|
|
|
25,348
|
|
|
29,374
|
|
|
24,942
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic (loss) earnings per share
|
$
|
(0.61
|
)
|
|
$
|
0.13
|
|
|
$
|
(0.71
|
)
|
|
$
|
0.17
|
|
Diluted (loss) earnings per share
|
$
|
(0.61
|
)
|
|
$
|
0.13
|
|
|
$
|
(0.71
|
)
|
|
$
|
0.16
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
June 30,
|
|
Change
|
|||||||||||
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
|
(dollars in thousands)
|
|||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||
Environmental Solutions
|
$
|
36,950
|
|
|
$
|
90,113
|
|
|
$
|
(53,163
|
)
|
|
(59.0
|
)%
|
Maintenance and Technical Services
|
83,986
|
|
|
105,610
|
|
|
(21,624
|
)
|
|
(20.5
|
)%
|
|||
Total revenue
|
120,936
|
|
|
195,723
|
|
|
(74,787
|
)
|
|
(38.2
|
)%
|
|||
Cost of sales
|
123,001
|
|
|
165,174
|
|
|
(42,173
|
)
|
|
(25.5
|
)%
|
|||
Gross (Loss) Profit:
|
|
|
|
|
|
|
|
|
||||||
Environmental Solutions
|
(9,188
|
)
|
|
22,096
|
|
|
(31,284
|
)
|
|
(141.6
|
)%
|
|||
Maintenance and Technical Services
|
7,123
|
|
|
8,453
|
|
|
(1,330
|
)
|
|
(15.7
|
)%
|
|||
Total gross (loss) profit
|
(2,065
|
)
|
|
30,549
|
|
|
(32,614
|
)
|
|
(106.8
|
)%
|
|||
General and administrative expenses
|
17,400
|
|
|
18,937
|
|
|
(1,537
|
)
|
|
(8.1
|
)%
|
|||
Operating (loss) income
|
(19,465
|
)
|
|
11,612
|
|
|
(31,077
|
)
|
|
(267.6
|
)%
|
|||
Interest expense, net
|
(4,102
|
)
|
|
(5,543
|
)
|
|
1,441
|
|
|
26.0
|
%
|
|||
Income from equity method investment
|
663
|
|
|
699
|
|
|
(36
|
)
|
|
(5.2
|
)%
|
|||
(Loss) income before taxes
|
(22,904
|
)
|
|
6,768
|
|
|
(29,672
|
)
|
|
(438.4
|
)%
|
|||
Income tax provision
|
(5,628
|
)
|
|
2,906
|
|
|
(8,534
|
)
|
|
(100.0
|
)%
|
|||
Net (loss) income
|
(17,276
|
)
|
|
3,862
|
|
|
(21,138
|
)
|
|
(547.3
|
)%
|
|||
Less income attributable to non-controlling interest
|
750
|
|
|
642
|
|
|
108
|
|
|
16.8
|
%
|
|||
Net (loss) income attributable to Charah Solutions, Inc.
|
(18,026
|
)
|
|
3,220
|
|
|
(21,246
|
)
|
|
(659.8
|
)%
|
|||
Adjusted EBITDA
(1)
|
$
|
(2,353
|
)
|
|
$
|
25,999
|
|
|
$
|
(28,352
|
)
|
|
(109.1
|
)%
|
Adjusted EBITDA margin
(1)
|
(1.9)%
|
|
13.3%
|
|
(15.2)%
|
|
N/A
|
(1)
|
Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. For a definition of Adjusted EBITDA and Adjusted EBITDA margin, as well as a reconciliation of Adjusted EBITDA to net (loss) income, our most directly comparable GAAP financial measure, and a calculation of Adjusted EBITDA, please read “—Non-GAAP Financial Measures” below.
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
June 30,
|
|
Change
|
|||||||||||
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
|
(dollars in thousands)
|
|||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||
Environmental Solutions
|
$
|
95,333
|
|
|
$
|
137,897
|
|
|
$
|
(42,564
|
)
|
|
(30.9
|
)%
|
Maintenance and Technical Services
|
188,861
|
|
|
213,355
|
|
|
(24,494
|
)
|
|
(11.5
|
)%
|
|||
Total revenue
|
284,194
|
|
|
351,252
|
|
|
(67,058
|
)
|
|
(19.1
|
)%
|
|||
Cost of sales
|
270,880
|
|
|
301,605
|
|
|
(30,725
|
)
|
|
(10.2
|
)%
|
|||
Gross (Loss) Profit:
|
|
|
|
|
—
|
|
|
|
||||||
Environmental Solutions
|
(921
|
)
|
|
34,565
|
|
|
(35,486
|
)
|
|
(102.7
|
)%
|
|||
Maintenance and Technical Services
|
14,235
|
|
|
15,082
|
|
|
(847
|
)
|
|
(5.6
|
)%
|
|||
Total gross profit
|
13,314
|
|
|
49,647
|
|
|
(36,333
|
)
|
|
(73.2
|
)%
|
|||
General and administrative expenses
|
31,385
|
|
|
33,319
|
|
|
(1,934
|
)
|
|
(5.8
|
)%
|
|||
Operating (loss) income
|
(18,071
|
)
|
|
16,328
|
|
|
(34,399
|
)
|
|
(210.7
|
)%
|
|||
Interest expense, net
|
(9,154
|
)
|
|
(9,674
|
)
|
|
520
|
|
|
(5.4
|
)%
|
|||
Income from equity method investment
|
1,217
|
|
|
1,286
|
|
|
(69
|
)
|
|
(5.4
|
)%
|
|||
(Loss) income before taxes
|
(26,008
|
)
|
|
7,940
|
|
|
(33,948
|
)
|
|
(427.6
|
)%
|
|||
Income tax provision
|
(6,389
|
)
|
|
2,906
|
|
|
(9,295
|
)
|
|
(319.9
|
)%
|
|||
Net (loss) income
|
(19,619
|
)
|
|
5,034
|
|
|
(24,653
|
)
|
|
(489.7
|
)%
|
|||
Less income attributable to non-controlling interest
|
1,226
|
|
|
1,009
|
|
|
217
|
|
|
21.5
|
%
|
|||
Net (loss) income attributable to Charah Solutions, Inc.
|
(20,845
|
)
|
|
4,025
|
|
|
(24,870
|
)
|
|
(617.9
|
)%
|
|||
Adjusted EBITDA
(1)
|
$
|
6,553
|
|
|
$
|
43,361
|
|
|
$
|
(36,808
|
)
|
|
(84.9
|
)%
|
Adjusted EBITDA margin
(1)
|
2.3%
|
|
12.3%
|
|
(10.0)%
|
|
N/A
|
(1)
|
Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. For a definition of Adjusted EBITDA and Adjusted EBITDA margin, as well as a reconciliation of Adjusted EBITDA to net (loss) income, our most directly comparable GAAP financial measure, and a calculation of Adjusted EBITDA, please read “—Non-GAAP Financial Measures” below.
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
June 30,
|
|
Change
|
|||||||||||
|
2019
|
|
2018
|
|
$
|
|
%
|
|||||||
|
(dollars in thousands)
|
|||||||||||||
Cash flows used in operating activities
|
$
|
(3,428
|
)
|
|
$
|
(2,186
|
)
|
|
$
|
(1,242
|
)
|
|
56.8
|
%
|
Cash flows used in investing activities
|
(9,984
|
)
|
|
(27,145
|
)
|
|
17,161
|
|
|
(63.2
|
)%
|
|||
Cash flows provided by financing activities
|
16,093
|
|
|
12,065
|
|
|
4,028
|
|
|
33.4
|
%
|
|||
Net change in cash
|
$
|
2,681
|
|
|
$
|
(17,266
|
)
|
|
$
|
19,947
|
|
|
115.5
|
%
|
•
|
a commitment to loan up to a further $25.0 million in term loans, which expires in March 2020 (the “Delayed Draw Commitment” and the term loans funded under such Delayed Draw Commitment, the “Delayed Draw Term Loan”, together with the Closing Date Term Loan, the “Term Loan”).
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
|
|
June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(dollars in thousands)
|
||||||||||||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(18,026
|
)
|
|
$
|
3,220
|
|
|
$
|
(20,845
|
)
|
|
$
|
4,025
|
|
Interest expense, net
|
4,102
|
|
|
5,543
|
|
|
9,154
|
|
|
9,674
|
|
||||
Income tax provision
|
(5,628
|
)
|
|
2,906
|
|
|
(6,389
|
)
|
|
2,906
|
|
||||
Depreciation and amortization
|
5,378
|
|
|
8,704
|
|
|
11,635
|
|
|
17,135
|
|
||||
Elimination of certain non-recurring legal costs and expenses
(1)
|
—
|
|
|
2,489
|
|
|
(746
|
)
|
|
5,169
|
|
||||
Elimination of certain non-recurring start-up costs
(2)
|
—
|
|
|
688
|
|
|
—
|
|
|
1,480
|
|
||||
Equity-based compensation
|
799
|
|
|
1,292
|
|
|
1,007
|
|
|
1,403
|
|
||||
Brickhaven contract deemed termination revenue reversal
|
10,000
|
|
|
—
|
|
|
10,000
|
|
|
—
|
|
||||
Transaction-related expenses and other items
(3)
|
1,022
|
|
|
1,157
|
|
|
2,737
|
|
|
1,569
|
|
||||
Adjusted EBITDA
|
$
|
(2,353
|
)
|
|
$
|
25,999
|
|
|
$
|
6,553
|
|
|
$
|
43,361
|
|
Adjusted EBITDA margin
(4)
|
(1.9)%
|
|
13.3%
|
|
2.3%
|
|
12.3%
|
(1)
|
Represents non-recurring legal costs and expenses, which amounts are not representative of those that we historically incur in the ordinary course of our business. Negative amounts represent insurance recoveries related to these matters.
|
(2)
|
Represents non-recurring start-up costs associated with the startup of Allied and our nuclear services offerings, including the setup of financial operations systems and modules, pre-contract expenses to obtain initial contracts and the hiring of operational staff. Because these costs are associated with the initial setup of the Allied business to initiate the operations involved in our nuclear services offerings, these costs are non-recurring in the normal course of our business.
|
(3)
|
Represents SCB transaction expenses, executive severance costs, IPO-related costs and other miscellaneous items.
|
(4)
|
Adjusted EBITDA margin is a non-GAAP financial measure that represents the ratio of Adjusted EBITDA to total revenues. We use Adjusted EBITDA margin to measure the success of our businesses in managing our cost base and improving profitability.
|
Exhibit
Number
|
|
Description
|
|
Amended and Restated Certificate of Incorporation of Charah Solutions, Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8‑K filed June 22, 2018 (File No. 001‑38523)).
|
|
|
Amended and Restated Bylaws of Charah Solutions, Inc. (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8‑K filed June 22, 2018 (File No. 001‑38523)).
|
|
|
Form of Performance Share Unit Grant Notice (Form for grantee with employment agreement)
|
|
|
Form of Performance Share Unit Grant Notice (Form for grantee without employment agreement)
|
|
|
Form of Restricted Stock Unit Grant Notice (Form for grantee with employment agreement)
|
|
|
Form of Restricted Stock Unit Grant Notice (Form for grantee without employment agreement)
|
|
|
Employment Agreement between Charah, LLC, Charah Solutions, Inc. and Roger D. Shannon, dated June 17, 2019 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed June 14, 2019 (File No. 001-38523)).
|
|
|
Amended and Restated Employment Agreement between Charah, LLC, Charah Solutions, Inc. and Scott A. Sewell, dated June 10, 2019 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K, filed June 14, 2019 (File No. 001-38523)).
|
|
|
Amendment No. 2 to Credit Agreement and Waiver between Charah Solutions, Inc., Bank of America, N.A., as administrative agent, the lenders party thereto and certain subsidiary guarantors named therein, dated August 13, 2019 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed August 14, 2019 (File No. 001-38523)).
|
|
|
Certification of Principal Executive Officer pursuant to Rule 13a‑14(a)/15d‑14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
Certification of Principal Financial Officer pursuant to Rule 13a‑14(a)/15d‑14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.CAL*
|
|
XBRL Calculation Linkbase Document.
|
101.DEF*
|
|
XBRL Definition Linkbase Document.
|
101.INS*
|
|
XBRL Instance Document.
|
101.LAB*
|
|
XBRL Labels Linkbase Document.
|
101.PRE*
|
|
XBRL Presentation Linkbase Document.
|
101.SCH*
|
|
XBRL Schema Document.
|
*
|
|
Filed herewith.
|
**
|
|
Furnished herewith.
|
†
|
|
Indicates a management contract or compensatory plan or arrangement.
|
|
|
|
|
CHARAH SOLUTIONS, INC.
|
|
|
|
|
|
|
|
August 14, 2019
|
By:
|
/s/ Scott A. Sewell
|
|
Name:
|
Scott A. Sewell
|
|
Title:
|
President, Chief Executive Officer and Director
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
August 14, 2019
|
By:
|
/s/ Roger D. Shannon
|
|
Name:
|
Roger Shannon
|
|
Title:
|
Chief Financial Officer and Treasurer
|
|
|
(Principal Financial Officer and Principal Accounting Officer)
|
|
|
|
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