ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 20-0953973 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) |
One Commerce Square 2005 Market Street, 17th Floor Philadelphia, PA | 19103 | |
(Address of principal executive offices) | (Zip Code) |
Large Accelerated Filer | o | Accelerated Filer | ý | |
Non-Accelerated Filer | o | Smaller Reporting Company | o | |
Emerging Growth Company | o |
A. | The Company determined that it had not previously accounted for certain foreign currency gains/losses on intercompany balances and transactions in accordance with U. S. generally accepted accounting principles ("US GAAP"). The Company improperly accounted for the foreign currency effect of certain transactions as if they were long-term investments by including the foreign currency effect in accumulated other comprehensive loss instead of properly recording the effect as operating expenses as required under Accounting Standard Codification (ASC) 830 “Foreign Currency Matters.” |
B. | The Company identified departures from US GAAP under ASC 605-35 “Construction-Type and Production-Type Contracts” in its historical accounting for revenue recognition on nine long-term customer contracts with fee constraints (e.g., fixed fee, lump sum, maximum contract value). The Company enters into agreements for construction management and consulting services with customers, and the guidance of ASC 605-35 states that contracts for construction consulting services, such as under agency contracts or construction management agreements, fall within the scope of the standard and should follow either Percentage of Completion or Completed Contract methods of accounting. Historically, the Company had not consistently applied the percentage of completion method of revenue recognition. |
C. | The Company discovered that it had not properly performed the required impairment testing of amortizable intangible assets in accordance with US GAAP in that an asset that was no longer in use as of July 2013 was not identified and impaired. In addition, an improper useful life was used for some of the Company’s internally developed software assets resulting in an improper amount of amortization expense being recorded in previous periods. |
D. | The Company discovered that the amounts of liabilities pertaining to the obligation for end of service benefits in six foreign countries were improperly accounted for under the guidance in ASC 715 “Compensation — Retirement Benefits”. |
E. | The Company determined the accrual for uncertain tax benefits taken with respect to income tax matters in Libya had been improperly released during 2013 and 2014 prior to the expiration of the statute of limitations on the Libyan tax authority’s right to audit the related tax years. |
F. | During the restatement process, the Company identified other transactions that had been recorded to incorrect accounts and/or in improper amounts. |
G. | Some of the corrections noted above impacted earnings (loss) before taxes which, in turn, required a calculation of the tax impact. |
• | The markets for the Company's services; |
• | Projections of revenues and earnings, anticipated contractual obligations, funding requirements or other financial items; |
• | Statements concerning the Company's plans, strategies and objectives for future operations; and |
• | Statements regarding future economic conditions or the Company's performance. |
• | The risks set forth in Item 1A, “Risk Factors,” in the Company's most recent Annual Report on Form 10K/A; |
• | Unfavorable global economic conditions may adversely impact its business; |
• | Backlog, which is subject to unexpected adjustments and cancellations, may not be fully realized as revenue; |
• | The Company may incur difficulties in implementing the Profit Improvement Plan; |
• | The Company's expenses may be higher than anticipated; |
• | Modifications and termination of client contracts; |
• | Control and operational issues pertaining to business activities that the Company conducts pursuant to joint ventures with other parties; |
• | Difficulties that may incur in implementing the Company's acquisition strategy; and |
• | The need to retain and recruit key technical and management personnel. |
• | Unexpected delays in collections from clients, particularly those located in the Middle East; |
• | Risks of the Company's ability to obtain debt financing or otherwise raise capital to meet required working capital needs and to support potential future acquisition activities; |
• | Risks of international operations, including uncertain political and economic environments, acts of terrorism or war, potential incompatibilities with foreign joint venture partners, foreign currency fluctuations, civil disturbances and labor issues; and |
• | Risks of contracts with governmental entities, including the failure of applicable governing authorities to take necessary actions to secure or maintain funding for particular projects with us, the unilateral termination of contracts by the government and reimbursement obligations to the government for funds previously received. |
June 30, 2017 | December 31, 2016 | |||||||
(unaudited) | ||||||||
Assets | ||||||||
Assets | ||||||||
Cash and cash equivalents | $ | 16,738 | $ | 25,637 | ||||
Cash - restricted | 4,470 | 4,312 | ||||||
Accounts receivable, less allowance for doubtful accounts of $66,941 and $71,082 | 160,656 | 164,844 | ||||||
Accounts receivable - affiliates | 8,402 | 5,712 | ||||||
Prepaid expenses and other current assets | 7,770 | 7,751 | ||||||
Income tax receivable | 4,723 | 3,554 | ||||||
Current assets held for sale | — | 54,651 | ||||||
Total current assets | 202,759 | 266,461 | ||||||
Property and equipment, net | 14,880 | 16,389 | ||||||
Cash - restricted, net of current portion | 1,160 | 313 | ||||||
Retainage receivable | 18,112 | 17,225 | ||||||
Acquired intangibles, net | 4,965 | 6,006 | ||||||
Goodwill | 51,942 | 50,665 | ||||||
Investments | 4,466 | 3,501 | ||||||
Deferred income tax assets | 3,695 | 3,200 | ||||||
Other assets | 5,500 | 4,224 | ||||||
Non-current assets held for sale | — | 32,091 | ||||||
Total assets | $ | 307,479 | $ | 400,075 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current maturities of notes payable and long-term debt | $ | 4,532 | $ | 1,983 | ||||
Accounts payable and accrued expenses | 87,384 | 85,680 | ||||||
Income taxes payable | 9,691 | 4,874 | ||||||
Current portion of deferred revenue | 5,334 | 12,943 | ||||||
Other current liabilities | 9,982 | 8,157 | ||||||
Current liabilities held for sale | — | 25,888 | ||||||
Total current liabilities | 116,923 | 139,525 | ||||||
Notes payable and long-term debt, net of current maturities | 32,374 | 142,120 | ||||||
Retainage payable | 1,071 | 961 | ||||||
Deferred income taxes | 2,670 | 560 | ||||||
Deferred revenue | 15,866 | 22,804 | ||||||
Other liabilities | 18,624 | 12,666 | ||||||
Non-current liabilities held for sale | — | 5,087 | ||||||
Total liabilities | 187,528 | 323,723 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock, $0.0001 par value; 1,000 shares authorized, none issued | — | — | ||||||
Common stock, $0.0001 par value; 100,000 shares authorized, 59,076 shares and 58,835 shares issued at June 30, 2017 and December 31, 2016, respectively | 6 | 6 | ||||||
Additional paid-in capital | 194,491 | 190,353 | ||||||
Accumulated deficit | (39,802 | ) | (81,349 | ) | ||||
Accumulated other comprehensive loss | (6,681 | ) | (4,611 | ) | ||||
148,014 | 104,399 | |||||||
Less treasury stock of 6,977 shares at June 30, 2017 and December 31, 2016, respectively | (30,041 | ) | (30,041 | ) | ||||
Hill International, Inc. share of equity | 117,973 | 74,358 | ||||||
Noncontrolling interests | 1,978 | 1,994 | ||||||
Total equity | 119,951 | 76,352 | ||||||
Total liabilities and stockholders’ equity | $ | 307,479 | $ | 400,075 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(As restated) | (As restated) | |||||||||||||||
Revenues | $ | 125,436 | $ | 132,709 | $ | 241,556 | $ | 269,608 | ||||||||
Direct expenses | 86,807 | 92,354 | 165,316 | 185,655 | ||||||||||||
Gross profit | 38,629 | 40,355 | 76,240 | 83,953 | ||||||||||||
Selling, general and administrative expenses | 40,074 | 34,323 | 73,537 | 72,116 | ||||||||||||
Share of (profit) loss of equity method affiliates | (82 | ) | 31 | (48 | ) | 16 | ||||||||||
Operating (loss) profit | (1,363 | ) | 6,001 | 2,751 | 11,821 | |||||||||||
Interest and related financing fees, net | 282 | 576 | 1,031 | 1,204 | ||||||||||||
(Loss) Earnings before income taxes | (1,645 | ) | 5,425 | 1,720 | 10,617 | |||||||||||
Income tax (benefit) expense | (649 | ) | 2,749 | 700 | 3,205 | |||||||||||
(Loss) Earnings from continuing operations | (996 | ) | 2,676 | 1,020 | 7,412 | |||||||||||
Discontinued operations: | ||||||||||||||||
Loss from discontinued operations, net of tax | (7,301 | ) | (574 | ) | (11,552 | ) | (1,817 | ) | ||||||||
Gain on disposal of discontinued operations, net of tax | 52,195 | — | 52,195 | — | ||||||||||||
Total gain (loss) from discontinued operations | 44,894 | (574 | ) | 40,643 | (1,817 | ) | ||||||||||
Net earnings | 43,898 | 2,102 | 41,663 | 5,595 | ||||||||||||
Less: net earnings (loss) - noncontrolling interests | 1 | (28 | ) | 120 | (39 | ) | ||||||||||
Net earnings attributable to Hill International, Inc. | $ | 43,897 | $ | 2,130 | $ | 41,543 | $ | 5,634 | ||||||||
Basic (loss) earnings per common share from continuing operations | $ | (0.02 | ) | $ | 0.05 | $ | 0.02 | $ | 0.14 | |||||||
Basic loss per common share from discontinued operations | (0.14 | ) | (0.01 | ) | (0.22 | ) | (0.03 | ) | ||||||||
Basic gain on disposal of discontinued operations, net of tax | 1.00 | — | 1.00 | — | ||||||||||||
Basic earnings per common share - Hill International, Inc. | $ | 0.84 | $ | 0.04 | $ | 0.80 | $ | 0.11 | ||||||||
Basic weighted average common shares outstanding | 51,952 | 51,727 | 51,906 | 51,679 | ||||||||||||
Diluted (loss) earnings per common share from continuing operations | $ | (0.02 | ) | $ | 0.05 | $ | 0.02 | $ | 0.14 | |||||||
Diluted loss per common share from discontinued operations | (0.14 | ) | (0.01 | ) | (0.22 | ) | (0.03 | ) | ||||||||
Diluted gain on disposal of discontinued operations, net of tax | 1.00 | — | 0.99 | — | ||||||||||||
Diluted earnings per common share - Hill International, Inc. | $ | 0.84 | $ | 0.04 | $ | 0.79 | $ | 0.11 | ||||||||
Diluted weighted average common shares outstanding | 51,952 | 51,948 | 52,468 | 51,777 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(As restated) | (As restated) | |||||||||||||||
Net earnings | $ | 43,898 | $ | 2,102 | $ | 41,663 | $ | 5,595 | ||||||||
Foreign currency translation adjustment, net of tax | (644 | ) | 581 | (2,202 | ) | 578 | ||||||||||
Other, net | — | 22 | — | 56 | ||||||||||||
Comprehensive earnings (loss) | 43,254 | 2,705 | 39,461 | 6,229 | ||||||||||||
Comprehensive loss attributable to non-controlling interests | (135 | ) | (810 | ) | (16 | ) | (1,520 | ) | ||||||||
Comprehensive earnings (loss) attributable to Hill International, Inc. | $ | 43,389 | $ | 3,515 | $ | 39,477 | $ | 7,749 |
Six Months Ended June 30, | ||||||||
2017 | 2016 | |||||||
(As restated) | ||||||||
Cash flows from operating activities: | ||||||||
Net earnings | $ | 41,663 | $ | 5,595 | ||||
Loss from discontinued operations | 11,552 | 1,817 | ||||||
Gain on sale of discontinued operations, net of taxes (see note 2) | (52,195 | ) | — | |||||
Earnings from continuing operations | 1,020 | 7,412 | ||||||
Adjustments to reconcile net earnings to net cash provided by (used in): | ||||||||
Depreciation and amortization | 3,255 | 4,209 | ||||||
Provision for bad debts | 215 | 3,370 | ||||||
Amortization of deferred loan fees | 597 | 889 | ||||||
Deferred tax benefit | 332 | (312 | ) | |||||
Stock based compensation | 2,435 | 1,175 | ||||||
Unrealized foreign exchange losses on intercompany balances | 1,122 | 2,117 | ||||||
Changes in operating assets and liabilities: | ||||||||
Restricted cash | (995 | ) | 565 | |||||
Accounts receivable | 3,973 | 3,485 | ||||||
Accounts receivable - affiliate | (2,684 | ) | (2,321 | ) | ||||
Prepaid expenses and other current assets | 343 | 1,567 | ||||||
Income taxes receivable | (832 | ) | (410 | ) | ||||
Retainage receivable | 414 | (12,714 | ) | |||||
Other assets | (4,080 | ) | 6,211 | |||||
Accounts payable and accrued expenses | (7,651 | ) | (11,261 | ) | ||||
Income taxes payable | (5,691 | ) | (3,532 | ) | ||||
Deferred revenue | (14,470 | ) | 7,374 | |||||
Other current liabilities | 2,631 | 2,196 | ||||||
Retainage payable | 108 | 530 | ||||||
Other liabilities | 9,042 | 1,545 | ||||||
Net cash (used in) provided by continuing operations | (10,916 | ) | 12,095 | |||||
Net cash provided by (used in) discontinued operations | (2,895 | ) | (4,535 | ) | ||||
Net cash (used in) provided by in operating activities | (13,811 | ) | 7,560 | |||||
Cash flows from investing activities: | ||||||||
Purchases of business | (123 | ) | (58 | ) | ||||
Payments for purchase of property and equipment | (1,574 | ) | (231 | ) | ||||
Net cash used in investing activities of continuing operations | (1,697 | ) | (289 | ) | ||||
Net cash provided by (used in) investing activities of discontinued operations | 129,247 | (566 | ) | |||||
Net cash provided by (used in) investing activities | 127,550 | (855 | ) | |||||
Cash flows from financing activities: | ||||||||
Payments on term loans | — | (600 | ) | |||||
Proceeds from term loans | 30,000 | — | ||||||
Net (payments) borrowings on revolving loans | (26,605 | ) | 348 | |||||
Pay-off and termination of term loan | (117,494 | ) | — | |||||
Payments on Philadelphia Industrial Development Corporation loan | (14 | ) | (23 | ) | ||||
Dividends paid to noncontrolling interest | (18 | ) | (109 | ) | ||||
Payments of financing fees | (4,038 | ) | — | |||||
Proceeds from stock issued under employee stock purchase plan | 115 | 10 | ||||||
Proceeds from exercise of stock options | 735 | 204 | ||||||
Net cash used in financing activities | (117,319 | ) | (170 | ) | ||||
Effect of exchange rate changes on cash | (5,319 | ) | (5,702 | ) | ||||
Net (decrease) increase in cash and cash equivalents | (8,899 | ) | 833 | |||||
Cash and cash equivalents — beginning of period | 25,637 | 24,089 | ||||||
Cash and cash equivalents — end of period | $ | 16,738 | $ | 24,922 |
As Previously | ||||||||||||||
Reported | Adjustment | As Restated | Reference | |||||||||||
Revenues | $ | 131,845 | $ | 864 | $ | 132,709 | B, D | |||||||
Direct expenses | 92,354 | — | 92,354 | |||||||||||
Gross profit | 39,491 | 864 | 40,355 | |||||||||||
Selling, general and administrative expenses | 35,695 | (1,372 | ) | 34,323 | A, C, D | |||||||||
Share of loss of equity method affiliates | 31 | — | 31 | |||||||||||
Operating profit | 3,765 | 2,236 | 6,001 | |||||||||||
Interest and related financing fees, net | 161 | 415 | 576 | D | ||||||||||
Earnings before income taxes | 3,604 | 1,821 | 5,425 | |||||||||||
Income tax expense | 2,731 | 18 | 2,749 | E | ||||||||||
Earnings from continuing operations | 873 | 1,803 | 2,676 | |||||||||||
Loss (earnings) from discontinued operations | 604 | (1,178 | ) | (574 | ) | D | ||||||||
Net earnings | 1,477 | 625 | 2,102 | |||||||||||
Less: net loss - noncontrolling interests | (13 | ) | (15 | ) | (28 | ) | D | |||||||
Net earnings attributable to Hill International, Inc. | $ | 1,490 | $ | 640 | $ | 2,130 | ||||||||
Basic earnings per common share from continuing operations | $ | 0.02 | $ | 0.03 | $ | 0.05 | ||||||||
Basic loss (earnings) per common share from discontinued operations | 0.01 | (0.02 | ) | (0.01 | ) | |||||||||
Basic earnings per common share - Hill International, Inc. | $ | 0.03 | $ | 0.01 | $ | 0.04 | ||||||||
Basic weighted average common shares outstanding | 51,727 | — | 51,727 | |||||||||||
Diluted earnings per common share from continuing operations | $ | 0.02 | $ | 0.03 | $ | 0.05 | ||||||||
Diluted loss (earnings) per common share from discontinued operations | 0.01 | (0.02 | ) | (0.01 | ) | |||||||||
Diluted earnings per common share - Hill International, Inc. | $ | 0.03 | $ | 0.01 | $ | 0.04 | ||||||||
Diluted weighted average common shares outstanding | 51,948 | — | 51,948 |
As Previously | ||||||||||||||
Reported | Adjustment | As Restated | Reference | |||||||||||
Revenues | $ | 266,215 | $ | 3,393 | $ | 269,608 | B, D | |||||||
Direct expenses | 185,655 | — | 185,655 | |||||||||||
Gross profit | 80,560 | 3,393 | 83,953 | |||||||||||
Selling, general and administrative expenses | 74,093 | (1,977 | ) | 72,116 | A, C, D | |||||||||
Share of loss of equity method affiliates | 16 | — | 16 | |||||||||||
Operating profit | 6,451 | 5,370 | 11,821 | |||||||||||
Interest and related financing fees, net | 374 | 830 | 1,204 | D | ||||||||||
Earnings before income taxes | 6,077 | 4,540 | 10,617 | |||||||||||
Income tax expense | 2,897 | 308 | 3,205 | E | ||||||||||
Earnings from continuing operations | 3,180 | 4,232 | 7,412 | |||||||||||
Loss from discontinued operations | (249 | ) | (1,568 | ) | (1,817 | ) | D | |||||||
Net earnings | 2,931 | 2,664 | 5,595 | |||||||||||
Less: net loss - noncontrolling interests | (9 | ) | (30 | ) | (39 | ) | D | |||||||
Net earnings attributable to Hill International, Inc. | 2,940 | 2,694 | 5,634 | |||||||||||
Basic earnings per common share from continuing operations | $ | 0.06 | $ | 0.08 | $ | 0.14 | ||||||||
Basic loss per common share from discontinued operations | — | (0.03 | ) | (0.03 | ) | |||||||||
Basic earnings per common share - Hill International, Inc. | $ | 0.06 | $ | 0.05 | $ | 0.11 | ||||||||
Basic weighted average common shares outstanding | 51,679 | — | 51,679 | |||||||||||
Diluted earnings per common share from continuing operations | $ | 0.06 | $ | 0.08 | $ | 0.14 | ||||||||
Diluted loss per common share from discontinued operations | — | (0.03 | ) | (0.03 | ) | |||||||||
Diluted (loss) earnings per common share - Hill International, Inc. | $ | 0.06 | $ | 0.05 | $ | 0.11 | ||||||||
Diluted weighted average common shares outstanding | 51,777 | — | 51,777 |
As Previously | ||||||||||||||
Reported | Adjustment | As Restated | Reference | |||||||||||
Net earnings | $ | 1,477 | $ | 625 | $ | 2,102 | A, B, C, D, E | |||||||
Foreign currency translation adjustment, net | (53 | ) | 634 | 581 | A, B, C, D | |||||||||
Other, net | 22 | — | 22 | |||||||||||
Comprehensive loss | $ | 1,446 | $ | 1,259 | $ | 2,705 | ||||||||
Comprehensive loss attributable to noncontrolling interest | (603 | ) | (207 | ) | (810 | ) | ||||||||
Comprehensive loss attributable to Hill International Inc. | $ | 2,049 | 1,466 | $ | 3,515 |
As Previously | ||||||||||||||
Reported | Adjustment | As Restated | Reference | |||||||||||
Net earnings | $ | 2,931 | $ | 2,664 | $ | 5,595 | A, B, C, D, E | |||||||
Foreign currency translation adjustment, net | 381 | 197 | 578 | A, B, C, D | ||||||||||
Other, net | 56 | — | 56 | |||||||||||
Comprehensive loss | $ | 3,368 | $ | 2,861 | 6,229 | |||||||||
Comprehensive loss attributable to noncontrolling interest | (1,355 | ) | (165 | ) | (1,520 | ) | ||||||||
Comprehensive loss attributable to Hill International Inc. | $ | 4,723 | $ | 3,026 | $ | 7,749 |
As Previously | ||||||||||||
Reported | Adjustment | As Restated | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net earnings | $ | 2,931 | $ | 2,664 | $ | 5,595 | ||||||
Loss from discontinued operations | — | 1,817 | 1,817 | |||||||||
Earnings from continuing operations | 2,931 | 4,481 | 7,412 | |||||||||
Adjustments to reconcile net earnings to net cash provided by (used in): | ||||||||||||
Depreciation and amortization | 5,200 | (991 | ) | 4,209 | ||||||||
Provision for bad debts | 3,326 | 44 | 3,370 | |||||||||
Amortization of deferred loan fees | 889 | — | 889 | |||||||||
Deferred tax benefit | 605 | (917 | ) | (312 | ) | |||||||
Stock based compensation | 1,257 | (82 | ) | 1,175 | ||||||||
Unrealized foreign exchange losses on intercompany balances | — | 2,117 | 2,117 | |||||||||
Changes in operating assets and liabilities: | ||||||||||||
Restricted cash | 633 | (68 | ) | 565 | ||||||||
Accounts receivable | 7,237 | (3,752 | ) | 3,485 | ||||||||
Accounts receivable - affiliate | (2,208 | ) | (113 | ) | (2,321 | ) | ||||||
Prepaid expenses and other current assets | 844 | 723 | 1,567 | |||||||||
Income taxes receivable | (622 | ) | 212 | (410 | ) | |||||||
Retainage receivable | (12,714 | ) | — | (12,714 | ) | |||||||
Other assets | 4,104 | 2,107 | 6,211 | |||||||||
Accounts payable and accrued expenses | (11,060 | ) | (201 | ) | (11,261 | ) | ||||||
Income taxes payable | (5,013 | ) | 1,481 | (3,532 | ) | |||||||
Deferred revenue | 5,546 | 1,828 | 7,374 | |||||||||
Other current liabilities | 1,116 | 1,080 | 2,196 | |||||||||
Retainage payable | 68 | 462 | 530 | |||||||||
Other liabilities | 430 | 1,115 | 1,545 | |||||||||
Net cash provided by continuing operations | 2,569 | 9,526 | 12,095 | |||||||||
Net cash used in discontinued operations | — | (4,535 | ) | (4,535 | ) | |||||||
Net cash provided by in operating activities | 2,569 | 4,991 | 7,560 | |||||||||
Cash flows from investing activities: | ||||||||||||
Purchases of business | — | (58 | ) | (58 | ) | |||||||
Payments for purchase of property and equipment | (783 | ) | 552 | (231 | ) | |||||||
Net cash used in investing activities of continuing operations | (783 | ) | 494 | (289 | ) | |||||||
Net cash used in investing activities of discontinued operations | — | (566 | ) | (566 | ) | |||||||
Net cash used in investing activities | (783 | ) | (72 | ) | (855 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Payments on term loans | (600 | ) | — | (600 | ) | |||||||
Net borrowings on revolving loans | 348 | — | 348 | |||||||||
Payments on Philadelphia Industrial Development Corporation loan | (27 | ) | 4 | (23 | ) | |||||||
Dividends paid to noncontrolling interest | (111 | ) | 2 | (109 | ) | |||||||
Proceeds from stock issued under employee stock purchase plan | 10 | — | 10 | |||||||||
Proceeds from exercise of stock options | 204 | — | 204 | |||||||||
Net cash used in financing activities | (176 | ) | 6 | (170 | ) | |||||||
Effect of exchange rate changes on cash | (777 | ) | (4,925 | ) | (5,702 | ) | ||||||
Net increase in cash and cash equivalents | 833 | — | 833 | |||||||||
Cash and cash equivalents — beginning of period | 24,089 | — | 24,089 | |||||||||
Cash and cash equivalents — end of period | $ | 24,922 | $ | — | $ | 24,922 |
April 30, 2017 | December 31, 2016 | |||||||
Accounts receivable, net | $ | 47,611 | $ | 50,892 | ||||
Prepaid expenses and other current assets | 3,153 | 3,064 | ||||||
Income taxes receivable | — | 695 | ||||||
Total current assets classified as held for sale | $ | 50,764 | $ | 54,651 | ||||
Property and equipment, net | 5,786 | 4,617 | ||||||
Acquired intangibles, net | 3,289 | 3,397 | ||||||
Goodwill | 23,454 | 23,461 | ||||||
Investments | 5 | 6 | ||||||
Other assets | 2,860 | 610 | ||||||
Total non-current assets classified as held for sale | $ | 35,394 | $ | 32,091 | ||||
Accounts payable and accrued expenses | 15,960 | 21,539 | ||||||
Income taxes payable | (17 | ) | 92 | |||||
Deferred revenue | — | 1,562 | ||||||
Other current liabilities | 15,867 | 2,695 | ||||||
Total current liabilities classified as held for sale | $ | 31,810 | $ | 25,888 | ||||
Deferred income taxes | — | 385 | ||||||
Deferred revenue | 92 | 1,012 | ||||||
Retained Earnings | — | 457 | ||||||
Other liabilities | 1,257 | 3,233 | ||||||
Total non-current liabilities classified as held for sale | $ | 1,349 | $ | 5,087 | ||||
Net Assets | $ | 52,999 | 55,767 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2017 (1) | 2016 | 2017 (1) | 2016 | |||||||||||||
(As restated) | (As restated) | |||||||||||||||
Revenues | $ | 18,119 | $ | 43,821 | $ | 62,149 | $ | 85,706 | ||||||||
Direct expenses | 9,377 | 20,369 | 31,339 | 40,047 | ||||||||||||
Gross profit | 8,742 | 23,452 | 30,810 | 45,659 | ||||||||||||
Selling, general and administrative expenses (2) | 10,155 | 20,617 | 33,147 | 40,783 | ||||||||||||
Operating (loss) profit | (1,413 | ) | 2,835 | (2,337 | ) | 4,876 | ||||||||||
Interest and related financing fees, net (3) | 5,763 | 2,762 | 8,858 | 5,531 | ||||||||||||
Loss before gain on disposal and income taxes | (7,176 | ) | 73 | (11,195 | ) | (655 | ) | |||||||||
Pretax gain on the disposal of discontinued operations (4) | 61,443 | — | 61,443 | — | ||||||||||||
Earnings from discontinued operations before income taxes | 54,267 | 73 | 50,248 | (655 | ) | |||||||||||
Income tax expense (5) | 9,373 | 647 | 9,605 | 1,162 | ||||||||||||
Net gain (loss) from discontinued operations | $ | 44,894 | $ | (574 | ) | $ | 40,643 | $ | (1,817 | ) |
(1) | Results of operations for the Claims Group are reflected through April 30, 2017, the effective closing date of the Claims Group sale. |
(2) | No amortization or depreciation expense was recorded by the Company in 2017 as the Claims Group’s assets were held for sale as of December 31, 2016. |
(3) | In connection with the sale of the Claims Group, the Company was required to pay off its existing term loan facility and amend and pay down its existing revolving credit facilities (See Note 9). Interest expense and debt issuance costs attributable to the Claims Group were charged to discontinued operations. |
(4) | The pretax gain on the sale of the Construction Claims Group was calculated as follows (in thousands): |
(5) | The effective tax rates on pretax income from discontinued operations were 17.3% and 19.1% for the three and six months ended June 30, 2017, respectively. The 2017 rate differs from the U.S. federal statutory rate of 35% primarily due to the utilization of the US operating loss which had a full valuation allowance, on the US gain on the sale of the discontinued operations. During the second quarter of 2017, the Company charged discontinued operations approximately $9,248 for potential tax liability related to the gain on the sale. |
June 30, 2017 | December 31, 2016 | |||||||
Billed | $ | 192,430 | $ | 200,134 | ||||
Retainage, current portion | 9,415 | 10,824 | ||||||
Unbilled | 25,752 | 24,968 | ||||||
227,597 | 235,926 | |||||||
Allowance for doubtful accounts | (66,941 | ) | (71,082 | ) | ||||
Total | $ | 160,656 | $ | 164,844 |
June 30, 2017 | December 31, 2016 | |||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | |||||||||||||
Client relationships | $ | 17,094 | $ | 12,606 | $ | 16,699 | $ | 11,298 | ||||||||
Acquired contract rights | 2,055 | 1,983 | 2,058 | 1,912 | ||||||||||||
Trade names | 860 | 455 | 959 | 500 | ||||||||||||
Total | $ | 20,009 | $ | 15,044 | $ | 19,716 | $ | 13,710 | ||||||||
Intangible assets, net | $ | 4,965 | $ | 6,006 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||
(As restated) | (As restated) | |||||||||||||
$ | 504 | $ | 1,121 | $ | 1,063 | $ | 1,993 |
Estimated Amortization Expense | ||||
Year ending December 31, | ||||
2017 (remaining 6 months) | $ | 978 | ||
2018 | 1,088 | |||
2019 | 990 | |||
2020 | 728 | |||
2021 | 342 |
Balance, December 31, 2016 | $ | 50,665 | |
Translation adjustments | 1,277 | ||
Balance, June 30, 2017 | $ | 51,942 |
June 30, 2017 | December 31, 2016 | |||||||
Accounts payable | $ | 28,049 | $ | 30,944 | ||||
Accrued payroll and related expenses | 35,140 | 32,618 | ||||||
Accrued subcontractor fees | 11,824 | 9,188 | ||||||
Accrued agency fees | 6,379 | 5,702 | ||||||
Accrued legal and professional fees | 2,814 | 2,223 | ||||||
Other accrued expenses | 3,178 | 5,005 | ||||||
$ | 87,384 | $ | 85,680 |
June 30, 2017 | December 31, 2016 | |||||||
2014 Term Loan Facility, net of unamortized discount and deferred financing costs of $4,416 at December 31, 2016 | $ | — | $ | 112,884 | ||||
2017 Term Loan Facility, net of unamortized discount and deferred financing costs of $972 at June 30, 2017 | 28,832 | — | ||||||
Domestic Revolving Credit Facility | 1,500 | 16,500 | ||||||
International Revolving Credit Facility | — | 11,102 | ||||||
Borrowings under credit facilities with a consortium of banks in Spain | 2,841 | 2,962 | ||||||
Borrowings under overdraft credit facilities with the National Bank of Abu Dhabi | 3,106 | — | ||||||
Borrowings from Philadelphia Industrial Development Corporation | 627 | 655 | ||||||
36,906 | 144,103 | |||||||
Less current maturities, net of unamortized discount and deferred financing costs of $196 | 4,532 | 1,983 | ||||||
Notes payable and long-term debt, net of current maturities | $ | 32,374 | $ | 142,120 |
• | the London Inter-Bank Offered Rate (“LIBOR”) for the relevant interest period plus 5.75% per annum, provided that such LIBOR shall not be lower than 1.00% per annum; or |
• | the Base Rate (as described below) plus 4.75% per annum. |
Six Months Ended June 30, | ||||||||
2017 | 2016 | |||||||
Interest and related financing fees paid | $ | 4,026 | $ | 5,924 | ||||
Income taxes paid | $ | 4,928 | $ | 7,390 | ||||
Increase (decrease) in other current liabilities and decrease (increase) in additional paid-in capital related to ESA Put Options | $ | (777 | ) | $ | 2,670 | |||
Increase in additional paid-in capital from the issuance of shares of common stock from cashless exercise of stock options | $ | — | $ | 729 |
Total | Hill International, Inc. Stockholders | Noncontrolling Interest | ||||||||||
Stockholders’ equity, December 31, 2016 | $ | 76,352 | $ | 74,358 | $ | 1,994 | ||||||
Net earnings | 41,663 | 41,543 | 120 | |||||||||
Other comprehensive earnings | (2,202 | ) | (2,066 | ) | (136 | ) | ||||||
Comprehensive (loss) earnings | 39,461 | 39,477 | (16 | ) | ||||||||
Additional paid in capital | 4,138 | 4,138 | — | |||||||||
Stockholders’ equity, June 30, 2017 | $ | 119,951 | $ | 117,973 | $ | 1,978 |
Three Months Ended June 30, 2017 | Three Months Ended June 30, 2016 | |||||||||||||||||||||||
U.S. | Foreign | Total | U.S. | Foreign | Total | |||||||||||||||||||
(Loss) earnings before income taxes | $ | (1,018 | ) | $ | (627 | ) | $ | (1,645 | ) | $ | (4,578 | ) | $ | 10,003 | $ | 5,425 | ||||||||
Income tax expense (benefit), net | $ | (1,726 | ) | $ | 1,077 | $ | (649 | ) | $ | — | $ | 2,749 | $ | 2,749 | ||||||||||
Six Months Ended June 30, 2017 | Six Months Ended June 30, 2016 | |||||||||||||||||||||||
U.S. | Foreign | Total | U.S. | Foreign | Total | |||||||||||||||||||
(Loss) earnings before income taxes | $ | (4,108 | ) | $ | 5,828 | $ | 1,720 | $ | (13,462 | ) | $ | 24,079 | $ | 10,617 | ||||||||||
Income tax expense (benefit), net | $ | (1,726 | ) | $ | 2,426 | $ | 700 | $ | — | $ | 3,205 | $ | 3,205 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||||||||
(As restated) | (As restated) | |||||||||||||||||||||||
United States/Canada | 60,852 | 48.5 | % | 52,279 | 39.4 | % | 109,589 | 45.4 | % | 97,519 | 36.2 | % | ||||||||||||
Latin America | 3,258 | 2.6 | % | 5,188 | 3.9 | % | 6,300 | 2.6 | % | 10,394 | 3.9 | % | ||||||||||||
Europe | 9,930 | 7.9 | % | 9,964 | 7.5 | % | 20,120 | 8.3 | % | 19,728 | 7.3 | % | ||||||||||||
Middle East | 43,187 | 34.4 | % | 55,650 | 41.9 | % | 88,964 | 36.8 | % | 121,307 | 45.0 | % | ||||||||||||
Africa | 5,902 | 4.7 | % | 6,318 | 4.8 | % | 11,616 | 4.8 | % | 12,713 | 4.7 | % | ||||||||||||
Asia/Pacific | 2,307 | 1.9 | % | 3,310 | 2.5 | % | 4,967 | 2.1 | % | 7,947 | 2.9 | % | ||||||||||||
Total | 125,436 | 100.0 | % | 132,709 | 100.0 | % | 241,556 | 100.0 | % | 269,608 | 100.0 | % |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||
(As restated) | (As restated) | |||||||||||||
United States | $ | 7,104 | $ | 5,320 | 11,380 | 8,148 | ||||||||
Latin America | (2,142 | ) | 1,292 | (2,519 | ) | 2,187 | ||||||||
Europe | 2,393 | (2,753 | ) | 3,818 | (1,240 | ) | ||||||||
Middle East | 4,567 | 8,083 | 11,362 | 18,645 | ||||||||||
Africa | (1,490 | ) | 1,048 | (715 | ) | (1,115 | ) | |||||||
Asia/Pacific | (574 | ) | 77 | (447 | ) | 811 | ||||||||
Corporate | (11,221 | ) | (7,066 | ) | (20,128 | ) | (15,615 | ) | ||||||
Total | $ | (1,363 | ) | $ | 6,001 | 2,751 | 11,821 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(As restated) | (As restated) | |||||||||||||||
Project Management | $ | 1,453 | $ | 2,124 | $ | 2,975 | $ | 3,974 | ||||||||
Corporate | 207 | 179 | 280 | 235 | ||||||||||||
Total | $ | 1,660 | $ | 2,303 | $ | 3,255 | $ | 4,209 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||||||||||||
(As restated) | (As restated) | |||||||||||||||||||||||||||
U.S. federal government | $ | 4,015 | 3.2 | % | $ | 2,803 | 2.1 | % | $ | 7,236 | 3.0 | % | $ | 5,661 | 2.1 | % | ||||||||||||
U.S. state, regional and local governments | 40,715 | 32.5 | 39,147 | 29.5 | 75,955 | 31.4 | 73,120 | 27.1 | ||||||||||||||||||||
Foreign governments | 35,440 | 28.3 | 42,492 | 32.0 | 72,022 | 29.8 | 95,045 | 35.3 | ||||||||||||||||||||
Private sector | 45,266 | 36.0 | 48,267 | 36.4 | 86,343 | 35.8 | 95,782 | 35.5 | ||||||||||||||||||||
Total | $ | 125,436 | 100.0 | % | $ | 132,709 | 100.0 | % | $ | 241,556 | 100.0 | % | $ | 269,608 | 100.0 | % |
June 30, 2017 | December 31, 2016 | |||||||
United States/Canada | $ | 11,347 | $ | 12,626 | ||||
Latin America | 792 | 881 | ||||||
Europe | 1,103 | 218 | ||||||
Middle East | 1,371 | 1,645 | ||||||
Africa | 127 | 169 | ||||||
Asia/Pacific | 140 | 850 | ||||||
Total | $ | 14,880 | $ | 16,389 |
Three Months Ended June 30, | |||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||
(As restated) | |||||||||||||||||||||
United States/Canada | $ | 60,852 | 48.5 | % | $ | 52,279 | 39.4 | % | $ | 8,573 | 16.4 | % | |||||||||
Latin America | 3,258 | 2.6 | % | 5,188 | 3.9 | (1,930 | ) | (37.2 | )% | ||||||||||||
Europe | 9,930 | 7.9 | % | 9,964 | 7.5 | (34 | ) | (0.3 | )% | ||||||||||||
Middle East | 43,187 | 34.4 | % | 55,650 | 41.9 | (12,463 | ) | (22.4 | )% | ||||||||||||
Africa | 5,902 | 4.7 | % | 6,318 | 4.8 | (416 | ) | (6.6 | )% | ||||||||||||
Asia/Pacific | 2,307 | 1.9 | % | 3,310 | 2.5 | (1,003 | ) | (30.3 | )% | ||||||||||||
Total | $ | 125,436 | 100.0 | % | $ | 132,709 | 100.0 | % | $ | (7,273 | ) | (5.5 | )% |
Three Months Ended June 30, | ||||||||||||||||||||||||
2017 | 2016 | Change | ||||||||||||||||||||||
(As restated) | ||||||||||||||||||||||||
% of Revenue | % of Revenue | |||||||||||||||||||||||
United States/Canada | 43,505 | 50.1 | % | 71.5 | % | 37,106 | 40.2 | % | 71.0 | % | 6,399 | 17.2 | % | |||||||||||
Latin America | 2,150 | 2.5 | % | 66.0 | % | 3,313 | 3.6 | % | 63.9 | % | (1,163 | ) | (35.1 | )% | ||||||||||
Europe | 6,748 | 7.8 | % | 68.0 | % | 6,893 | 7.4 | % | 69.2 | % | (145 | ) | (2.1 | )% | ||||||||||
Middle East | 30,138 | 34.7 | % | 69.8 | % | 38,870 | 42.1 | % | 69.8 | % | (8,732 | ) | (22.5 | )% | ||||||||||
Africa | 3,093 | 3.6 | % | 52.4 | % | 4,135 | 4.5 | % | 65.4 | % | (1,042 | ) | (25.2 | )% | ||||||||||
Asia/Pacific | 1,173 | 1.3 | % | 50.8 | % | 2,037 | 2.2 | % | 61.5 | % | (864 | ) | (42.4 | )% | ||||||||||
Total | 86,807 | 100.0 | % | 69.2 | % | 92,354 | 100.0 | % | 69.6 | % | (5,547 | ) | (6.0 | )% |
Three Months Ended June 30, | |||||||||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||||||||
(As restated) | |||||||||||||||||||||||||||
% of Revenue | % of Revenue | ||||||||||||||||||||||||||
United States/Canada | $ | 17,347 | 44.9 | % | 28.5 | % | $ | 15,173 | 37.6 | % | 29.0 | % | $ | 2,174 | 14.3 | % | |||||||||||
Latin America | 1,108 | 2.9 | 34.0 | % | 1,875 | 4.6 | % | 36.1 | % | (767 | ) | (40.9 | )% | ||||||||||||||
Europe | 3,182 | 8.2 | 32.0 | % | 3,071 | 7.6 | % | 30.8 | % | 111 | 3.6 | % | |||||||||||||||
Middle East | 13,049 | 33.8 | 30.2 | % | 16,780 | 41.6 | % | 30.2 | % | (3,731 | ) | (22.2 | )% | ||||||||||||||
Africa | 2,809 | 7.3 | 47.6 | % | 2,183 | 5.4 | % | 34.6 | % | 626 | 28.7 | % | |||||||||||||||
Asia/Pacific | 1,134 | 2.9 | 49.2 | % | 1,273 | 3.2 | % | 38.5 | % | (139 | ) | (10.9 | )% | ||||||||||||||
Total | $ | 38,629 | 100.0 | % | 30.8 | % | $ | 40,355 | 100.0 | % | 30.4 | % | $ | (1,726 | ) | (4.3 | )% |
Three months ended June 30, | |||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||
(As restated) | |||||||||||||||||||||
% of Revenue | % of Revenue | ||||||||||||||||||||
United States | $ | 10,243 | 16.8 | % | $ | 9,853 | 18.8 | % | $ | 390 | 4.0 | % | |||||||||
Latin America | 3,250 | 99.8 | 583 | 11.2 | 2,667 | 457.5 | |||||||||||||||
Europe | 789 | 7.9 | 5,824 | 58.5 | (5,035 | ) | (86.5 | ) | |||||||||||||
Middle East | 8,482 | 19.6 | 8,697 | 15.6 | (215 | ) | (2.5 | ) | |||||||||||||
Africa | 4,299 | 72.8 | 1,135 | 18.0 | 3,164 | 278.8 | |||||||||||||||
Asia/Pacific | 1,790 | 77.6 | 1,165 | 35.2 | 625 | 53.6 | |||||||||||||||
Corporate | 11,221 | 8.9 | 7,066 | 5.3 | 4,155 | 58.8 | |||||||||||||||
Total | $ | 40,074 | 31.9 | % | $ | 34,323 | 25.9 | % | $ | 5,751 | 16.8 | % |
Three Months Ended June 30, | |||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||
(As restated) | |||||||||||||||||||||
% of Revenue | % of Revenue | ||||||||||||||||||||
United States/Canada | $ | 7,104 | 11.7 | % | $ | 5,320 | 10.2 | % | $ | 1,784 | 33.5 | % | |||||||||
Latin America | (2,142 | ) | (65.7 | )% | 1,292 | 24.9 | % | (3,434 | ) | (265.8 | )% | ||||||||||
Europe | 2,393 | 24.1 | % | (2,753 | ) | (27.6 | )% | 5,146 | (186.9 | )% | |||||||||||
Middle East | 4,567 | 10.6 | % | 8,083 | 14.5 | % | (3,516 | ) | (43.5 | )% | |||||||||||
Africa | (1,490 | ) | (25.2 | )% | 1,048 | 16.6 | % | (2,538 | ) | (242.2 | )% | ||||||||||
Asia/Pacific | (574 | ) | (24.9 | )% | 77 | 2.3 | % | (651 | ) | (845.5 | )% | ||||||||||
Corporate cost | (11,221 | ) | — | % | (7,066 | ) | — | % | (4,155 | ) | 58.8 | % | |||||||||
Total | $ | (1,363 | ) | (1.1 | )% | $ | 6,001 | 4.5 | % | $ | (7,364 | ) | (122.7 | )% |
Six Months Ended June 30, | |||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||
(As restated) | |||||||||||||||||||||
United States/Canada | $ | 109,589 | 45.4 | % | $ | 97,519 | 36.2 | % | $ | 12,070 | 12.4 | % | |||||||||
Latin America | 6,300 | 2.6 | 10,394 | 3.9 | (4,094 | ) | (39.4 | ) | |||||||||||||
Europe | 20,120 | 8.3 | 19,728 | 7.3 | 392 | 2.0 | |||||||||||||||
Middle East | 88,964 | 36.8 | 121,307 | 45.0 | (32,343 | ) | (26.7 | ) | |||||||||||||
Africa | 11,616 | 4.8 | 12,713 | 4.7 | (1,097 | ) | (8.6 | ) | |||||||||||||
Asia/Pacific | 4,967 | 2.1 | 7,947 | 2.9 | (2,980 | ) | (37.5 | ) | |||||||||||||
Total | $ | 241,556 | 100.0 | % | $ | 269,608 | 100.0 | % | $ | (28,052 | ) | (10.4 | )% |
Six Months Ended June 30, | |||||||||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||||||||
(As restated) | |||||||||||||||||||||||||||
% of Revenue | % of Revenue | ||||||||||||||||||||||||||
United States/Canada | $ | 76,663 | 46.4 | % | 70.0 | % | $ | 68,670 | 37.0 | % | 70.4 | % | $ | 7,993 | 11.6 | % | |||||||||||
Latin America | 4,110 | 2.5 | 65.2 | 6,604 | 3.6 | 63.5 | (2,494 | ) | (37.8 | ) | |||||||||||||||||
Europe | 13,646 | 8.3 | 67.8 | 13,188 | 7.1 | 66.8 | 458 | 3.5 | |||||||||||||||||||
Middle East | 62,076 | 37.5 | 69.8 | 84,368 | 45.4 | 69.5 | (22,292 | ) | (26.4 | ) | |||||||||||||||||
Africa | 6,298 | 3.8 | 54.2 | 8,470 | 4.6 | 66.6 | (2,172 | ) | (25.6 | ) | |||||||||||||||||
Asia/Pacific | 2,523 | 1.5 | 50.8 | 4,355 | 2.3 | 54.8 | (1,832 | ) | (42.1 | ) | |||||||||||||||||
Total | $ | 165,316 | 100.0 | % | 68.4 | % | $ | 185,655 | 100.0 | % | 68.9 | % | $ | (20,339 | ) | (11.0 | )% |
Six Months Ended June 30, | |||||||||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||||||||
(As restated) | |||||||||||||||||||||||||||
% of Revenue | % of Revenue | ||||||||||||||||||||||||||
United States/Canada | $ | 32,926 | 43.2 | % | 30.0 | % | $ | 28,849 | 34.4 | % | 29.6 | % | $ | 4,077 | 14.1 | % | |||||||||||
Latin America | 2,190 | 2.9 | 34.8 | 3,790 | 4.5 | 36.5 | (1,600 | ) | (42.2 | ) | |||||||||||||||||
Europe | 6,474 | 8.5 | 32.2 | 6,540 | 7.8 | 33.2 | (66 | ) | (1.0 | ) | |||||||||||||||||
Middle East | 26,888 | 35.3 | 30.2 | 36,939 | 44.0 | 30.5 | (10,051 | ) | (27.2 | ) | |||||||||||||||||
Africa | 5,318 | 7.0 | 45.8 | 4,243 | 5.1 | 33.4 | 1,075 | 25.3 | |||||||||||||||||||
Asia/Pacific | 2,444 | 3.1 | 49.2 | 3,592 | 4.2 | 45.2 | (1,148 | ) | (32.0 | ) | |||||||||||||||||
Total | $ | 76,240 | 100.0 | % | 31.6 | % | $ | 83,953 | 100.0 | % | 31.1 | % | $ | (7,713 | ) | (9.2 | )% |
Six Months Ended June 30, | |||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||
(As restated) | |||||||||||||||||||||
% of Revenue | % of Revenue | ||||||||||||||||||||
United States | $ | 21,546 | 19.7 | % | $ | 20,701 | 21.2 | % | $ | 845 | 4.1 | % | |||||||||
Latin America | 4,709 | 74.7 | 1,603 | 15.4 | 3,106 | 193.8 | |||||||||||||||
Europe | 2,656 | 13.2 | 7,780 | 39.4 | (5,124 | ) | (65.9 | ) | |||||||||||||
Middle East | 15,526 | 17.5 | 18,294 | 15.1 | (2,768 | ) | (15.1 | ) | |||||||||||||
Africa | 6,033 | 51.9 | 5,358 | 42.1 | 675 | 12.6 | |||||||||||||||
Asia/Pacific | 2,939 | 59.2 | 2,765 | 34.8 | 174 | 6.3 | |||||||||||||||
Corporate | 20,128 | 8.3 | 15,615 | 5.8 | 4,513 | 28.9 | |||||||||||||||
Total | $ | 73,537 | 30.4 | % | $ | 72,116 | 26.7 | % | $ | 1,421 | 2.0 | % |
Six Months Ended June 30, | |||||||||||||||||||||
2017 | 2016 | Change | |||||||||||||||||||
(As restated) | |||||||||||||||||||||
% of Revenue | % of Revenue | ||||||||||||||||||||
United States/Canada | $ | 11,380 | 10.4 | % | $ | 8,148 | 8.4 | % | $ | 3,232 | 39.7 | % | |||||||||
Latin America | (2,519 | ) | (40.0 | ) | 2,187 | 21.0 | (4,706 | ) | (215.2 | ) | |||||||||||
Europe | 3,818 | 19.0 | (1,240 | ) | (6.3 | ) | 5,058 | (407.9 | ) | ||||||||||||
Middle East | 11,362 | 12.8 | 18,645 | 15.4 | (7,283 | ) | (39.1 | ) | |||||||||||||
Africa | (715 | ) | (6.2 | ) | (1,115 | ) | (8.8 | ) | 400 | (35.9 | ) | ||||||||||
Asia/Pacific | (447 | ) | (9.0 | ) | 811 | 10.2 | (1,258 | ) | (155.1 | ) | |||||||||||
Corporate cost | (20,128 | ) | — | (15,615 | ) | — | (4,513 | ) | 28.9 | ||||||||||||
Total | $ | 2,751 | 1.1 | % | $ | 11,821 | 4.4 | % | $ | (9,070 | ) | (76.7 | )% |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(As restated) | (As restated) | |||||||||||||||
Net (loss) earnings from continuing operations | $ | (996 | ) | $ | 2,676 | $ | 1,020 | $ | 7,412 | |||||||
Interest and related financing fees, net | 282 | 576 | 1,031 | 1,204 | ||||||||||||
Income tax expense | (649 | ) | 2,749 | 700 | 3,205 | |||||||||||
Depreciation and amortization | 1,660 | 2,303 | 3,255 | 4,209 | ||||||||||||
EBITDA | $ | 297 | $ | 8,304 | $ | 6,006 | $ | 16,030 |
Total Backlog | 12-Month Backlog | |||||||||||||
June 30, 2017 | ||||||||||||||
United States/Canada | $ | 466,335 | 52.2 | % | $ | 120,093 | 37.7 | % | ||||||
Latin America | 12,460 | 1.4 | 8,232 | 2.6 | ||||||||||
Europe | 64,465 | 7.2 | 30,043 | 9.4 | ||||||||||
Middle East | 288,111 | 32.2 | 134,030 | 42.1 | ||||||||||
Africa | 56,360 | 6.3 | 21,673 | 6.8 | ||||||||||
Asia/Pacific | 6,560 | 0.7 | 4,437 | 1.4 | ||||||||||
Total | $ | 894,291 | 100.0 | % | $ | 318,508 | 100.0 | % | ||||||
December 31, 2016 | ||||||||||||||
United States/Canada | $ | 459,000 | 54.5 | % | $ | 141,000 | 41.7 | % | ||||||
Latin America | 10,000 | 1.2 | 8,000 | 2.4 | ||||||||||
Europe | 38,225 | 4.5 | 26,091 | 7.7 | ||||||||||
Middle East | 284,028 | 33.8 | 133,030 | 39.3 | ||||||||||
Africa | 42,000 | 5.0 | 22,000 | 6.5 | ||||||||||
Asia/Pacific | 8,000 | 1.0 | 8,000 | 2.4 | ||||||||||
Total | $ | 841,253 | 100.0 | % | $ | 338,121 | 100.0 | % |
31.1 | ||
31.2 | ||
32.1 | ||
32.2 | ||
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.PRE | XBRL Taxonomy Presentation Linkbase Document. | |
101.CAL | XBRL Taxonomy Calculation Linkbase Document. | |
101.LAB | XBRL Taxonomy Label Linkbase. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. |
Hill International, Inc. | ||
By: | /s/ Paul J. Evans | |
Paul J. Evans | ||
Interim Chief Executive Officer | ||
(Principal Executive Officer) | ||
Dated: | June 21, 2018 | |
By: | /s/ Marco A. Martinez | |
Marco A. Martinez | ||
Senior Vice President and Interim Chief Financial Officer | ||
(Principal Financial Officer and Principal Accounting Officer) | ||
Dated: | June 21, 2018 |
Dated: | June 21, 2018 | /s/ Paul J. Evans |
Paul J. Evans | ||
Interim Chief Executive Officer |
Dated: | June 21, 2018 | /s/ Marco A. Martinez |
Marco A. Martinez | ||
Senior Vice President and Interim Chief Financial Officer |
Dated: | June 21, 2018 | /s/ Paul J. Evans |
Paul J. Evans | ||
Interim Chief Executive Officer | ||
Dated: | June 21, 2018 | /s/ Marco A. Martinez |
Marco A. Martinez | ||
Senior Vice President and Interim Chief Financial Officer | ||
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Mar. 31, 2018 |
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Document and Entity Information | ||
Entity Registrant Name | Hill International, Inc. | |
Entity Central Index Key | 0001287808 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 52,960,817 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q2 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 66,941 | $ 71,082 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 59,076,000 | 58,835,000 |
Treasury stock, shares | 6,977,000 | 6,977,000 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) EARNINGS - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
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Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 43,898 | $ 2,102 | $ 41,663 | $ 5,595 |
Foreign currency translation adjustment, net of tax | (644) | 581 | (2,202) | 578 |
Other, net | 0 | 22 | 0 | 56 |
Comprehensive earnings (loss) | 43,254 | 2,705 | 39,461 | 6,229 |
Comprehensive loss attributable to non-controlling interests | (135) | (810) | (16) | (1,520) |
Comprehensive earnings (loss) attributable to Hill International, Inc. | $ 43,389 | $ 3,515 | $ 39,477 | $ 7,749 |
The Company |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The Company | The Company Hill International, Inc. (“Hill” or the “Company”) is a professional services firm that provides program management, project management, construction management and other consulting services primarily to the buildings, transportation, environmental, energy and industrial markets worldwide. Hill’s clients include the U.S. federal government, U.S. state and local governments, foreign governments and the private sector. Restatement of Previously Issued Unaudited Condensed Consolidated Financial Statements On May 8, 2018, the Company filed its Annual Report on Form 10-K/A for the year ended December 31, 2016, which amended the Company’s audited consolidated financial statements for each of the years ended December 31, 2016, 2015 and 2014 and the related notes thereto. This Form 10-Q amends the Company’s unaudited condensed consolidated financial statements for the three and six months ended June 30, 2016 and the related notes thereto, included on Form 10-Q filed on August 8, 2016 (“Prior Filing”). The Restatement reflects the correction of the following errors identified for the three and six months ended June 30, 2016 subsequent to the Prior Filing and the impact of restating the three months ended March 31, 2017 on the six months ended June 30, 2017: A. In connection with the accounting for the May 2017 sale of its Construction Claims Group, the Company determined that it had not previously accounted for certain foreign currency gains/losses on intercompany balances and transactions in accordance with accounting principles generally accepted in the United States (“US GAAP”). The Company improperly accounted for the foreign currency effect of certain transactions as if they were long-term investments by including the foreign currency effect in accumulated other comprehensive income instead of properly recording the effect as operating expenses as required under Accounting Standard Codification (ASC) 830 “Foreign Currency Matters.” As a result of these corrections, selling, general and administrative (“SG&A”) expenses increased $270 and $476 for the three and six months ended June 30, 2016, respectively and decreased $1,813 for the six months ended June 30, 2017. B. The Company identified departures from US GAAP under ASC 605-35 “Construction-Type and Production-Type Contracts” in its historical accounting for revenue recognition on nine long-term customer contracts with fee constraints (e.g., fixed fee, lump sum, maximum contract value). The Company enters into agreements for construction management and consulting services with customers, and the guidance of ASC 605-35-15-3D states that contracts for construction consulting services, such as under agency contracts or construction management agreements, fall within the scope of the standard and should follow either Percentage of Completion or Completed Contract methods of accounting. Historically, the Company had not consistently applied the percentage of completion method of revenue recognition. The corrections to properly apply U.S. GAAP to the identified contracts resulted in an increase of $1,574 to revenues for the three months ended June 30, 2016 and increases of $3,130 and $4,155 to revenues for the six months ended June 30, 2017 and 2016, respectively. C. The Company discovered that it had not properly performed the required impairment testing of amortizable intangible assets in accordance with US GAAP in that certain assets no longer in use were not identified and impaired. In addition, an improper useful life was used for some of the Company’s internally developed software assets resulting in an improper amount of amortization expense being recorded in previous periods. The net effect of correcting these errors resulted in a $29 increase in SG&A expense for the six months ended June 30, 2017 and increases of $27 and $55 in SG&A expense for the three and six months ended June 30, 2016, respectively. D. The Company identified other transactions that had been recorded to incorrect accounts and/or in improper amounts. The net corrections of these transactions resulted in a $710 and $762 decrease in revenues for the three and six months ended June 30, 2016, respectively and a $5,421 increase in revenues for the six months ended June 30, 2017; a $5,305 increase in direct expenses for the six months ended June 30, 2017; a decrease of $1,670 and $2,509 in SG&A expenses for the three and six months ended June 30, 2016, respectively and an increase of $473 in SG&A expenses for the six month ended June 30, 2017; a $415 and a $830 increase in interest expense for the three and six months ended June 30, 2016; a $1,593 and $2,399 increase in net loss from discontinued operations for the three and six months ended June 30, 2016, respectively and a $504 decrease in net loss from discontinued operations for the six months ended June 30, 2017; and a $15 and $30 decrease in earnings from noncontrolling interest for the three and six months ended June 30, 2016, respectively and a $58 increase in earnings from noncontrolling interest for the six months ended June 30, 2017. In conjunction with the sale of the construction claims group, interest expense of $415 and $830 for the three and six months ended June 30, 2016, respectively, and interest expense of $552 for the six months ended June 30, 2017 was reclassified from continuing operations to discontinued operations. E. Some of the corrections noted above impacted earnings (loss) before taxes which, in turn, required a calculation of the tax impact. The net impact was an increase in income tax expense of $18 and $308 for the three and six months ended June 30, 2016, respectively and an increase in income tax expense of $695 for the six months ended June 30, 2017. HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS Three Months Ended June 30, 2016 (in thousands, except per share data)
HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS Six Months Ended June 30, 2016 (in thousands, except per share data)
HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Three Months Ended June 30, 2016 (in thousands)
HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Six Months Ended June 30, 2016 (in thousands)
In addition to the items noted above as part of the Restatement, the Company identified departures from US GAAP in its historical preparation and presentation of its statement of cash flows. The Company did not report its cash flows in the reporting currency equivalent of foreign currency using the exchange rates in effect at the time of the cash flows, or an appropriate average rate to approximate the rates in effect at the time of the cash flows. The impact of properly preparing a cash flow statement in each functional currency, translating the cash flow statement using the appropriate rate in effect at the time of a transaction, or substantially equivalent average rate for the period, and consolidation of the individual functional currency cash flows, as prescribed by the guidance in ASC 230, is depicted in the table below. The adjustments noted in the cash flow statements that follow are both a result of items “A” through “E” explained above, as well as the foreign currency effect from cash flow statements prepared in functional currency and appropriately translated. HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOW Six Months Ended June 30, 2016 (in thousands)
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Discontinued Operations and Sale of Business Unit |
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Discontinued Operations and Disposal Groups [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued Operations and Sale of Business Unit | Discontinued Operations and Sale of Business Unit On December 20, 2016, the Company and its subsidiary Hill International N.V. (“Hill N.V.” and, collectively with the Company, the “Sellers”) entered into a Stock Purchase Agreement (as amended on May 3, 2017, the “Agreement”) with Liberty Mergeco, Inc. (the “US Purchaser”) and Liberty Bidco UK Limited (the “UK Purchaser” and, collectively with the US Purchaser, the “Purchasers”) pursuant to which the Purchasers were to acquire the Construction Claims Group (the "Claims Group") by the US Purchaser’s acquisition of all of the stock of Hill International Consulting, Inc. from the Company and the UK Purchaser’s acquisition of all of the stock of Hill International Consulting B.V. from Hill N.V. for a total purchase price of $140,000 in cash reduced by assumed indebtedness and certain other items, as set forth in the Agreement. The Claims Group sale closed on May 5, 2017 with an effective date of April 30, 2017 for a total purchase price of $140,000 in cash less: (1) an estimated working capital adjustment at closing amounting to approximately $8,449; and (2) approximately $2,187 of assumed indebtedness. In addition, the Company was required to provide a $3,750 letter of credit into escrow in order to secure certain of the Company’s indemnification obligations for 12 months following closing. The funds provided by the sale of the Construction Claims Group and the cash received upon the draw down under the 2017 Term Loan Facility and the amended Revolving Credit Facilities (described below) were required to be used as follows: (a) $117,000 to pay off the 2014 Term Loan Facility; (b) approximately $8,793 to pay down the International Revolver; and (c) approximately $1,214 to pay accrued interest and certain bank fees. The remaining proceeds along with a portion of the proceeds from the 2017 Term Loan were used to pay down the $25,000 U.S. Revolver. The Company entered into a transition services agreement (the “TSA”) and certain other agreements with the Purchasers that governs the relationships between the Purchasers and the Company following the Claims Group sale. Pursuant to the TSA, the Company provides the Purchasers with certain specified services on a transitional basis for periods up to six months following the Claims Group sale, including support in areas such as facilities, finance, human resources, legal, marketing, technology and treasury. In addition, the Company granted the Purchasers a license to use certain office premises as specified in the TSA. The TSA also outlines the services that the Purchasers provides to the Company for a period of up to six months following the Claims Group sale, including support in areas such as finance, legal and treasury. The charges for the transition services and licensed premises generally allows the providing company to recover the incremental costs and expenses it actually incurs in connection with providing the services and premises apart from the provision of certain services that will be provided at no cost for terms specified in the TSA. As of April 30, 2017, the assets and liabilities of the Claims Group were reflected as held for sale in the Company’s Consolidated Balance Sheets, and the operating results and cash flows of the Claims Group were reflected as discontinued operations in the Company’s Consolidated Statements of Operations, Consolidated Statements of Comprehensive Earnings, and Consolidated Statements of Cash Flows for all periods presented. The carrying amounts of assets and liabilities of the discontinued operations of the Claims Group that were classified as held for sale are as follows (in thousands):
The line items constituting earnings from discontinued operations consist of the following (in thousands):
Adjusted purchase price $129,364 Cash transferred to buyer 4,041 Net proceeds received from Purchaser $125,323 Less net assets held for sale 52,999 Less other adjustments 10,881 Pretax gain on disposal $ 61,443
The results of discontinued operations include selling and transaction costs, including legal and professional fees incurred by the Company to complete the Claims Group sale of $3,503 and $4,742 during the three and six months ended June 30, 2017, respectively. |
Liquidity |
6 Months Ended |
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Jun. 30, 2017 | |
Construction and Development Costs [Abstract] | |
Liquidity | Liquidity The amount of revenues attributable to operations in the Middle East and Africa is approximately $49,089 and $100,580 of total consolidated revenue for the three and six months ended June 30, 2017, respectively. In 2012, due to the overthrow of the Libyan government, the Company reserved a $59,937 receivable from the Libyan Organization for Development of Administrative Centres (“ODAC”). Subsequently, the Company received payments totaling approximately $9,511. The Company wrote off approximately $3,593 during the six months ended June 30, 2017. The Company maintains a reserve of approximately $2,788 against accounts receivable from various projects in Iraq. The Company continues to experience slowing of collections from its clients in the Middle East, primarily Oman. In 2012, the Company commenced operations on the Muscat International Airport (the “Oman Airport”) project with the Ministry of Transport and Communications (the “MOTC”) in Oman. The original contract term expired in November 2014. The Company began to experience delays in payments during the second quarter of 2015 when MOTC commenced its formal review and certification of the Company’s invoices. The MOTC resumed payments in 2016, paying the Company approximately $42,000 during 2016 and approximately $19,253 through June 30, 2017. At June 30, 2017 accounts receivable from the Oman Airport totaled approximately $32,058, of which approximately $16,607 was past due based on contractual terms. From June 30, 2017 through May 31, 2018, the Company has collected approximately $33,905 on the MOTC contract. The delays in payments from MOTC and other foreign governments have had a negative impact on the Company’s liquidity, financial covenants, financial position and results of operations. From May 31, 2018 to June 21, 2018, the date of this filing, we were not in compliance with the requirements of our Revolving Credit Facilities which required the filing of this Quarterly Report on Form 10-Q by May 31, 2018. Upon the filing of this Quarterly Report on Form 10-Q, we are compliant under such requirements again. Prior waivers of non-compliance with certain covenants in our Revolving Credit Facilities require us to file the Form 10-Q for the third quarter of 2017 by June 30, 2018, the Form 10-K for the 2017 fiscal year by July 17, 2018 and the Form 10-Q for the first quarter of 2018 by July 30, 2018. If we do not file such reports in accordance with these deadlines, we may again be in noncompliance with the requirements of our Revolving Credit Facilities. |
Basis of Presentation |
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Jun. 30, 2017 | |
Basis of Presentation | |
Basis of Presentation | Basis of Presentation Basis of Presentation The accompanying unaudited interim consolidated financial statements were prepared in accordance with the rules and regulations of the Securities and Exchange Commission pertaining to reports on Form 10-Q and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K/A (Amendment No. 2) for the year ended December 31, 2016. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, these statements include all adjustments (consisting only of normal, recurring adjustments) necessary for a fair presentation of the consolidated financial statements. The consolidated financial statements include the accounts of Hill and its wholly- and majority-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The interim operating results are not necessarily indicative of the results for a full year. |
Accounts Receivable |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable | Accounts Receivable The components of accounts receivable are as follows (in thousands):
Unbilled receivables primarily represent revenue earned on contracts, which the Company is contractually precluded from billing until predetermined future dates. There is approximately $18,112 included in non-current Retainage Receivable in the consolidated balance sheet at June 30, 2017. Of that amount, approximately $9,660 relates to retention and approximately $8,452 relates to a Defect and Liability Period (“DLP”), which represents five percent of each monthly invoice which is retained by MOTC in Oman. Fifty percent of the DLP will be released one year from the commencement and the balance will be released upon the issuance of final Completion Certificates. This period commences upon the issuance of a “Taking Over Certificate” (by MOTC) to contractors, for a period of up to 24 months, and ends with a final certificate closing the project. |
Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets | Intangible Assets The following table summarizes the Company’s acquired intangible assets (in thousands):
Amortization expense related to intangible assets was as follows (in thousands):
The following table presents the estimated amortization expense based on our present intangible assets for the next five years (in thousands):
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Goodwill |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||
Goodwill | Goodwill The following table summarizes the changes in the Company’s carrying value of goodwill during 2017 (in thousands):
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Accounts Payable and Accrued Expenses |
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Payables and Accruals [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Payable and Accrued Expenses | Accounts Payable and Accrued Expenses Below are the components of accounts payable and accrued expenses (in thousands):
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Notes Payable and Long-Term Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notes Payable and Long-Term Debt | Notes Payable and Long-Term Debt Outstanding debt obligations are as follows (in thousands):
In conjunction with the sale of its Claims Group on May 5, 2017 (See Note 2), as required, the Company terminated and paid off the 2014 Term Loan Facility and amended and paid down its Domestic and International Revolving Credit Facilities with Société Générale (the “Agent”), and other U.S. Loan Parties (the “U.S. Lenders”). There was approximately $117,000 outstanding under the 2014 Term Loan, $25,000 outstanding on the Domestic Revolving Credit Facility and €8,300 ($8,793) outstanding on the International Revolving Credit Facility prior to the debt extinguishment and modification. The Company recorded a charge of approximately $4,024 for the write-off of unamortized debt issuance costs related to the extinguishment of the 2014 Term Loan Facility and approximately $325 for the write-off of unamortized debt issuance costs related to the modification and reduction of borrowing capacity of the Domestic Revolving Credit Facility. The write-off of unamortized debt issuance costs is included in the results from discontinued operations. The Company is party to a credit agreement with Société Générale (the “Agent”), and other U.S. Loan Parties (the “U.S. Lenders”) consisting of the $30,000 (the "2017 Term Loan Facility") and a $25,000 U.S. dollar-denominated revolving credit facility (the “Domestic Revolving Credit Facility”, together with the 2017 Term Loan Facility, the “U.S. Credit Facilities”) available to the Company and a credit agreement with the Agent (the “International Lender”) providing a €9,156 ($10,000 at closing) revolving credit facility (the “International Revolving Credit Facility” and together with the Domestic Revolving Credit Facility, the “Revolving Credit Facilities” and, together with the U.S. Credit Facilities, the “Secured Credit Facilities”) which is available to the Hill International N.V. The Domestic Revolving Credit Facility and the International Revolving Credit Facility include sub-limits for letters of credit amounting to $20,000 and €8,000 ($9,130 at June 30, 2017), respectively. The Secured Credit Facilities contain customary default provisions, representations and warranties, and affirmative and negative covenants, and require the Company to comply with certain financial and reporting covenants. The financial covenant is comprised of a Maximum Consolidated Net Leverage Ratio of 3.00 to 1.00 for any fiscal quarter ending on or subsequent to March 31, 2017 for the trailing twelve months then-ended. The Consolidated Net Leverage Ratio is the ratio of (a) consolidated total debt (minus unrestricted cash and cash equivalents) to consolidated earnings before interest, taxes, depreciation, amortization, share-based compensation and other non-cash charges, including bad debt expense, certain one-time litigation and transaction related expenses, and restructuring charges for the trailing twelve months. In the event of a default, the U.S. Lender and the International Lender may increase the interest rates by 2.0%. From May 31, 2018 to June 21, 2018, the date of this filing, we were not in compliance with the requirements of our Revolving Credit Facilities which required the filing of this Quarterly Report on Form 10-Q by May 31, 2018. Upon the filing of this Quarterly Report on Form 10-Q, we are compliant under such requirements again. Prior waivers of non-compliance with certain covenants in our Revolving Credit Facilities require us to file the Form 10-Q for the third quarter of 2017 by June 30, 2018, the Form 10-K for the 2017 fiscal year by July 17, 2018 and the Form 10-Q for the first quarter of 2018 by July 30, 2018. If we do not file such reports in accordance with these deadlines, we may again be in noncompliance with the requirements of our Revolving Credit Facilities. The U.S. Credit Facilities are guaranteed by certain U.S. subsidiaries of the Company, and the International Revolver is guaranteed by the Company and certain of the Company’s U.S. and non-U.S. subsidiaries. 2017 Term Loan Facility The disclosures that follow below describe the debt obligations outstanding as of June 30, 2017 under the 2017 Term Loan Facility. On June 21, 2017, the Company entered into the 2017 Term Loan Facility with a term of 6 years, requires repayment of 1.0% of the original principal amount annually for the first five years and was fully funded at closing. Any amounts repaid on the 2017 Term Loan Facility will not be available to be re-borrowed. The 2017 Term Loan Facility was funded net of a 1.0% discount of $300 of the principal amount, which has been deferred. In addition, the Company incurred fees and expenses related to the 2017 Term Loan Facility of approximately $874, which have been deferred. The original issue discount and debt issuance costs are being amortized on a straight-line basis, which approximates the effective interest method, to interest and related financing fees, net over the six years ending June 21, 2023, the loan maturity date. The unamortized original issue discount and debt issuance cost balance of approximately $1,174 is included as an offset against the notes payable and long-term debt balance in the Consolidated Balance Sheet at June 30, 2017. The interest rate on the 2017 Term Loan Facility is, at the Company’s option, either:
The “Base Rate” is a per annum rate equal to the highest of (A) the prime rate, (B) the federal funds effective rate plus 0.50%, or (C) the LIBOR for an interest period of one month plus 1.00% per annum. Upon a default, the applicable rate of interest under the Secured Credit Facilities may increase by 2.00%. The LIBOR (including when determining the Base Rate) shall in no event be less than 1.00% per annum. At June 30, 2017, the interest rate on the 2017 Term Loan Facility was 6.96%. The Company has the right to prepay the 2017 Term Loan Facility in full or in part at any time without premium or penalty (except customary breakage costs); provided, however, that upon the occurrence of prepayments relating to certain repricing transactions within the first six months following closing, a 1.0% prepayment premium will be payable. The Company is required to make certain mandatory prepayments, without premium or penalty (except customary breakage costs; provided, however, that upon the occurrence of any repricing transaction in respect of certain mandatory prepayments within the first six months following closing, a 1.0% prepayment premium is payable), including (i) with net proceeds of any issuance or incurrence of indebtedness by the Company after the closing, (ii) with net proceeds from certain asset sales outside the ordinary course of business, and (iii) with 50% of the excess cash flow for each fiscal year of the Company commencing with the first full fiscal year ending after closing (which percentage would be reduced to 25% if the Consolidated Net Leverage Ratio is equal to or less than 2.00 to 1.00). The 2017 Term Loan Facility (along with interest thereon) is generally secured by a first-priority security interest in substantially all assets of certain U.S. subsidiaries of the Company other than foreign subsidiaries accounts receivable and cash proceeds thereof, as to which the 2017 Term Loan Facility (and the interest thereon) is secured by a second-priority security interest. Revolving Credit Facilities Simultaneously with the closing of the sale, the Company amended its Domestic Revolving Credit Facility to reduce the amount available to the Company to $25,000, amended its International Revolving Credit Facility to reduce the amount available to the Company to $10,000, and drew approximately $25,191 in cash and approximately $9,193 in letters of credit against the amended Revolving Credit Facilities. Deferred fees incurred with establishing the Secured Credit Facilities amounting to approximately $5,622 were charged to discontinued operations during the quarter. The Domestic Revolving Credit Facility and the International Revolving Credit Facility each have a term of five years from the closing and provide for letter of credit sub-limits in amounts of $20,000 and €8,000 (approximately $9,130 at June 30, 2017), respectively. The maximum Consolidated Net Leverage Ratio will be increased from the prior credit facilities to 3.00 for all test dates and will not decline. The definition of Consolidated Net Leverage Ratio was amended to (i) remove the cap on the amount of permitted cash netting and (ii) permit netting of unrestricted cash and cash equivalents. The Company incurred fees totaling $1,739 which will be deferred and amortized to interest expense over the five-year term of the facilities. As of the date of closing, the new facilities are substantially drawn. The Revolving Credit Facilities require payment of interest only during the term and were substantially drawn as of the date of modification. Under the Revolving Credit Facilities, outstanding loans may be repaid in whole or in part at any time, without premium or penalty, subject to certain customary limitations, and will be available to be re-borrowed from time to time through expiration on May 5, 2022. The interest rate on borrowings under the Domestic Revolving Credit Facility are, at the Company’s option from time to time, either the LIBOR rate for the relevant interest period plus 3.75% per annum or the Base Rate plus 2.75% per annum. At June 30, 2017, the interest rate was 7.00%. The interest rate on borrowings under the International Revolving Credit Facility will be the European Inter-Bank Offered Rate, or “EURIBOR,” for the relevant interest period (or at a substitute rate to be determined to the extent EURIBOR is not available) plus 4.50% per annum. At June 30, 2017, the interest rate was 4.10%. The Company will pay a commitment fee calculated at 0.50% annually on the average daily unused portion of the Domestic Revolving Credit Facility, and the Subsidiary will pay a commitment fee calculated at 0.75% annually on the average daily unused portion of the International Revolving Credit Facility. The ability to borrow under each of the Domestic Revolving Credit Facility and the International Revolving Credit Facility is subject to a “borrowing base.” The Domestic Revolving Credit Facility borrowing base is calculated using a formula based upon approximately 85% of receivables that meet or satisfy certain criteria (“Eligible Domestic Receivables”). The International Revolving Credit Facility borrowing base is calculated using a different formula based upon approximately 10% of international receivables that meet or satisfy certain criteria. The Company or the Subsidiary, as applicable, will be required to make mandatory prepayments under their respective Revolving Credit Facilities to the extent that the aggregate outstanding amount thereunder exceeds the then-applicable borrowing base, which payments will be made without penalty or premium. At June 30, 2017, the domestic borrowing base was $25,000 and the international borrowing base was €9,156 (approximately $10,460 at June 30, 2017). Generally, the obligations of the Company under the Domestic Revolving Credit Facility are secured by a first-priority security interest in the Eligible Domestic Receivables, cash proceeds and bank accounts of the Company and certain of the Company’s U.S. subsidiaries, and a second-priority security interest in substantially all other assets of the Company and such subsidiaries. The obligations of the Subsidiary under the International Revolving Credit Facility are generally secured by a first-priority security interest in substantially all accounts receivable and cash proceeds thereof, certain bank accounts of the Subsidiary and certain of the Company’s non-U.S. subsidiaries, and a second-priority security interest in substantially all other assets of the Company and certain of the Company’s U.S. and non-U.S. subsidiaries. The Company incurred fees and expenses related to the Revolving Credit Facilities aggregating $3,000 which has been deferred. The deferred fees are being amortized on a straight-line basis, which approximates the effective interest method, to interest expense and related financing fees, net over a five-year period which ends on May 5, 2022. The unamortized debt issuance cost balances of $2,773 and $1,650 are included in other assets in the consolidated balance sheet at June 30, 2017 and December 31, 2016, respectively. At June 30, 2017 the Company had $8,164 of outstanding letters of credit and $15,336 of available borrowing capacity under the Domestic Revolving Credit Facility. At June 30, 2017, the Company had $809 of outstanding letters of credit and $9,651 of available borrowing capacity under the International Revolving Credit Facility and its other foreign credit agreements. Other Debt Arrangements The Company’s subsidiary, Hill International (Spain) S.A. (“Hill Spain”), maintained a revolving credit facility with three banks in Spain which initially provided for total borrowing of up to €5,640 with interest at 6.50% on outstanding borrowings. The facility expired on December 17, 2016. Concurrent with the satisfaction of this facility Hill Spain entered into a new agreement with three new banks. The total new facility is for €2,425 (approximately $2,767) at June 30, 2017. The facility was fully utilized at June 30, 2017. Interest rates at June 30, 2017 were between 1.85% and 3.50%. The loans have varying expiration dates between 36 and 60 months. Hill Spain also maintains an ICO (Official Credit Institute) loan with Bankia Bank in Spain for €30 (approximately $34) at June 30, 2017. The availability is reduced by €15 on a quarterly basis. At June 30, 2017, the loan was fully utilized. The interest rate at June 30, 2017 was 5.37%. The ICO loan expired on August 10, 2017. The Company maintains a credit facility with the National Bank of Abu Dhabi which provides for total borrowings of up to AED 11,500 (approximately $3,131 at June 30, 2017) collateralized by certain overseas receivables. At June 30, 2017, AED 11,408 was utilized (approximately $3,106). The interest rate is the one-month Emirates InterBank Offer Rate plus 3.50% (or 4.91% at June 30, 2017) but no less than 5.50%. This facility allows for letters of guarantee up to AED 200,000 (approximately $54,451 ) of which AED 99,180 (approximately $27,002) was outstanding at June 30, 2017. The credit facility is subject to periodic review by the bank and as such has been classified as current in the consolidated balance sheet. Engineering S.A. maintains four unsecured revolving credit facilities with two banks in Brazil aggregating 2,380 Brazilian Reais (BRL) (approximately $755) at June 30, 2017, with a weighted average interest rate of 5.07% per month at June 30, 2017. There were no borrowings outstanding on any of these facilities, which are renewed automatically every three months. The Company also maintains relationships with other foreign banks for the issuance of letters of credit, letters of guarantee and performance bonds in a variety of foreign currencies. At June 30, 2017, the maximum U.S. dollar equivalent of the commitments was $83,512, of which $35,450 is outstanding. In connection with the 2015 move of its corporate headquarters to Philadelphia, Pennsylvania, the Company received a loan from the Philadelphia Industrial Development Corporation in the amount of $750 which bears interest at 2.75%, is repayable in 144 equal monthly installments of $6 and matures on May 1, 2027. |
Supplemental Cash Flow Information |
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Supplemental Cash Flow Information | Supplemental Cash Flow Information The following table provides additional cash flow information (in thousands):
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Earnings per Share |
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Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share Basic earnings per common share have been computed using the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per common share incorporates the incremental shares issuable upon the assumed exercise of stock options using the treasury stock method, if dilutive and there are earnings from continuing operations. Dilutive stock options increased average common shares outstanding by approximately 464 and 221 shares for the three month periods ended June 30, 2017 and 2016, respectively and by 562 and 98 shares for the six month period ended June 30, 2017 and 2016, respectively. Options to purchase approximately 2,419 shares and 2,906 shares for the three month periods ended June 30, 2017 and 2016, respectively, and 2,419 shares and 5,631 shares for the six month periods ended June 30, 2017 and 2016, respectively, were excluded from the calculation of diluted earnings per share because they were antidilutive. |
Share-Based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation At June 30, 2017, the Company had approximately 6,057 options outstanding with a weighted average exercise price of $4.32. During the six months ended June 30, 2017, the Company granted approximately 716 options which vest over a five-year period. The options granted had a weighted average exercise price of $4.98 and a contractual life of 7.0 years. The aggregate fair value of the options was approximately $1,412 calculated using the Black-Scholes valuation model. The weighted average assumptions used to calculate fair value were: expected life—5 years; volatility—48.30% and risk-free interest rate—2.08%. During the six months ended June 30, 2017 options for approximately 1,293 shares with a weighted average exercise price of $5.48 lapsed and options for approximately 217 shares with a weighted average exercise price of $4.39 were forfeited. During the six months ended June 30, 2017, employees purchased approximately 31 common shares for an aggregate purchase price of approximately $115 pursuant to the Company’s 2008 Employee Stock Purchase Plan. The Company recognized share-based compensation expense in selling, general and administrative expenses in the consolidated statement of operations totaling approximately $1,974 and $599 for the three months ended June 30, 2017 and 2016, respectively, and approximately $2,434 and $1,257 for the six months ended June 30, 2017 and 2016, respectively. |
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Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity | Stockholders’ Equity The following table summarizes the changes in stockholders’ equity during the six months ended June 30, 2017 (in thousands):
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Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The effective tax rates for the three months ended June 30, 2017 and 2016 were 39.5% and 50.7%, respectively, and 40.7% and 30.2% for the six months ended June 30, 2017 and 2016, respectively. The Company’s effective tax rate represents the Company’s estimated tax rate for the year based on projected income and mix of income among the various foreign tax jurisdictions, adjusted for discrete transactions occurring during the period. The components of (loss) earnings before income taxes and the related income tax expense by the United States and foreign jurisdictions from continuing operations were as follows (in thousands):
The reserve for uncertain tax positions amounted to $7,092 and $6,735 at June 30, 2017 and December 31, 2016, respectively, and is included in “Other liabilities” in the consolidated balance sheet at those dates. The increase in the reserve is primarily due to expected outcomes of audits within foreign jurisdictions. The Company’s policy is to record income tax related interest and penalties in income tax expense. There were no such items related to uncertain tax positions for the three and six months ended June 30, 2017 and 2016, respectively. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities and projected future taxable income in making this assessment. Management evaluates the need for valuation allowances on the deferred tax assets according to the provisions of ASC 740, Income Taxes. They consider both positive and negative evidence. In making this determination, management assesses all of the evidence available at the time including recent earnings, internally-prepared income projections, and historical financial performance. |
Segment and Related Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment and Related Information | Segment and Related Information At June 30, 2017, due to the sale of our Construction Claims Group (see Note 2), the Company now has one operating segment, the Project Management Group, which reflects how the Company will be managed going forward. The Project Management Group provides construction and project management services to construction owners worldwide. Such services include program management, project management, construction management, project management oversight, troubled project turnaround, staff augmentation, project labor agreement consulting, commissioning, estimating and cost management, labor compliance services and facilities management services. The information for 2016 has been revised to exclude the operations of the Construction Claims Group which is accounted for as discontinued operations. The following tables present certain information for the Project Management Group’s operations (in thousands): Revenue by Geographic Region
For the quarter ended June 30, 2017, no other country, except for the United States, accounted for over 10% of consolidated total revenue. For the quarter ended June 30, 2016, total revenue for the United Arab Emirates amounted to $28,751 representing 21.7% of the total and Oman amounted to $14,002 representing 10.6% of consolidated total. No other country, except for the United States, accounted for over 10% of consolidated total revenue. For the six months ended June 30, 2017, no other country, except for the United States, accounted for over 10% of consolidated total revenue. For the six months ended June 30, 2016, total revenue for the United Arab Emirates amounted to $54,548 representing 20.2% of the consolidated total. No other country, except for the United States, accounted for over 10% of consolidated total revenue. Operating Profit (Loss)
Depreciation and Amortization Expense
Revenue By Client Type
Property, Plant and Equipment, Net, by Geographic Location
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Client Concentrations |
6 Months Ended |
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Jun. 30, 2017 | |
Risks and Uncertainties [Abstract] | |
Client Concentrations | Client Concentrations The Company had no individual clients that accounted for 10% or more of total revenues during the three and six months ended June 30, 2017 and 2016. |
Commitments and Contingencies |
6 Months Ended |
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Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies General Litigation In 2013, M.A. Angeliades, Inc. (“Plaintiff”) filed a complaint with the Supreme Court of New York against the Company and the New York City Department of Design and Construction (“DDC”) regarding payment of approximately $8,771 for work performed as a subcontractor to the Company plus interest and other costs. On October 5, 2015, pursuant to a settlement agreement, Hill paid Plaintiff approximately $2,596, including interest amounting to $1,056, of which $448 had been previously accrued and $608 was charged to expense for the year ended December 31, 2015. The Plaintiff resolved its remaining issues regarding change orders and compensation for delay with DDC. On January 16, 2016, Plaintiff filed a Motion to amend its complaint against the Company claiming that the amounts paid by the Company do not reconcile with the amounts Plaintiff believes the Company received from DDC despite DDC’s records reflecting the same amount as the Company’s. The Plaintiff’s Motion was granted and the parties are currently engaged in mediation and discovery. Knowles Limited (“Knowles”), a subsidiary of the Company, is a party to an arbitration proceeding instituted on July 8, 2014 in which Knowles claimed that it was entitled to payment for services rendered to Celtic Bioenergy Limited (“Celtic”). The arbitrator decided in favor of Knowles. The arbitrator’s award was appealed by Celtic to the U.K. High Court of Justice, Queen’s Bench Division, Technology and Construction Court (“Court”). On March 16, 2017, the Court (1) determined that certain relevant facts had been deliberately withheld from the arbitrator by an employee of Knowles and (2) remitted the challenged parts of the arbitrator’s award back to the arbitrator to consider the award in possession of the full facts. The Company is evaluating the impact of the judgment of the Court. From time to time, the Company is a defendant or plaintiff in various legal actions which arise in the normal course of business. As such the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of probable losses. A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter. The provision may change in the future due to new developments or changes in circumstances. Changes in the provision could increase or decrease the Company’s earnings in the period the changes are made. It is the opinion of management, after consultation with legal counsel, that the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. Acquisition-Related Contingencies As of June 30, 2017 our subsidiary, Hill International (Spain), S.A. (“Hill Spain”), owned an indirect 91.0% interest in Engineering S.A. (“ESA”), a firm located in Brazil. ESA’s shareholders entered into an agreement whereby the minority shareholders have a right to compel (“ESA Put Option”) Hill Spain to purchase any or all of their shares during the period from February 28, 2014 to February 28, 2021. Hill Spain also has the right to compel (“ESA Call Option”) the minority shareholders to sell any or all of their shares during the same time period. The purchase price for such shares shall be seven times the earnings before interest and taxes for ESA’s most recently ended fiscal year, net of any financial debt plus excess cash multiplied by a percentage which the shares to be purchased bear to the total number of shares outstanding at the time of purchase, but in the event the ESA Call Option is exercised by Hill Spain, the purchase price shall be increased by five percent. The ESA Put Option and the ESA Call Option must be made within three months after the audited financial statements of ESA have been completed. On June 17, 2016, the three remaining minority shareholders exercised their ESA Put Options claim a value of BRL 8,656 (approximately $2,618 at June 30, 2017). At that time, the Company accrued the liability in other current liabilities and as an adjustment to additional paid in capital. The amount is subject to negotiation and any difference will be recorded upon completion of the transaction. Other The Company has identified a potential tax liability related to certain foreign subsidiaries’ failure to comply with laws and regulations of the jurisdictions, outside of their home country, in which their employees provided services. The Company has estimated the potential liability to be approximately $2,132 of which approximately $444 has been included in discontinued operations in the consolidated statement of operations for the six months ended June 30, 2017. The potential liability balance is included in other liabilities in the consolidated balance sheet at June 30, 2017. In connection with the move of its corporate headquarters, the Commonwealth of Pennsylvania provided the Company with a $1,000 grant received on July 13, 2015. The terms of the grant require the Company to spend at least $6,425 on capital expenditures for leasehold improvements and equipment for its new headquarters, remain at One Commerce Square for at least seven-years and employ at least 359 persons no later than April 1, 2018. The Company has met the capital expenditure requirement and has a twelve-year lease for its corporate headquarters. Upon receipt of the funds, the Company recorded a deferred credit which, assuming the employment requirement is met, will be reflected in income in the second quarter of 2018. If the Company does not meet the employment criteria, it will be required to repay the grant to the Commonwealth of Pennsylvania. The terms of the agreement are currently under review. The landlord for the new Philadelphia headquarters provided the Company with a tenant improvement allowance amounting to approximately $3,894. The tenant improvement allowance, which has been deferred, is included in other liabilities in the consolidated balance sheet at June 30, 2017 and December 31, 2016 and is being amortized on a straight-line basis against rent expense over the term of the twelve-year lease which commenced on May 1, 2015. |
Subsequent Events |
6 Months Ended |
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Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Finalization of ESA Put Option The Company settled negotiations with the minority shareholders of ESA in November 2017 and February 2018. The shareholders agreed to a reduced total payment of BRL 6,084 (approximately $1,841). The Company made an adjustment to additional paid-in capital in the consolidated balance sheet at December 31, 2017 of BRL 4,475 (approximately $1,365) and on March 31, 2018 of BRL 3,146 (approximately $953) to record the final transaction amounts. Tax Cuts and Jobs Act On December 22, 2017, The Tax Cuts and Jobs Act of 2017 (Tax Act) was signed into law. The Tax Act will reduce the Company’s statutory U.S. federal corporate tax rate from 35% to 21% for the Company’s fiscal year beginning January 1, 2018. The Tax Act requires companies to pay a one-time transition tax on accumulated earnings of foreign subsidiaries, creates new taxes on certain foreign sourced earnings and eliminates or reduces certain deductions and credits. As of the time of this filing, the Company has not completed its evaluation of the effects of enactment of the Tax Act. Because a change in tax law is accounted for in the period of enactment, the effect of the Act will be recorded in the fourth quarter of 2017. Kuwait Performance Guarantee On or about February 8, 2018, the Company received notice from National Bank of Abu Dhabi (NBAD) that Public Authority of Housing Welfare of Kuwait submitted a claim for payment on a performance guarantee issued by the Company for approximately $7,927 for a project located in Kuwait. NBAD subsequently issued, on behalf of Company, payment on or about February 15, 2018. The Company is taking legal action to recover the full amount issued under the performance guarantee. Revolving Credit Facilities From May 31, 2018 to the date of this filing, we were not in compliance with the requirements of our Revolving Credit Facilities which required the filing of this Quarterly Report on Form 10-Q by May 31, 2018. Upon the filing of this Quarterly Report on Form 10-Q, we are compliant under such requirements again. Prior waivers of non-compliance with certain covenants in our Revolving Credit Facilities require us to file the Form 10-Q for the third quarter of 2017 by June 30, 2018, the Form 10-K for the 2017 fiscal year by July 17, 2018 and the Form 10-Q for the first quarter of 2018 by July 30, 2018. If we do not file such reports in accordance with these deadlines, we may again be in noncompliance with the requirements of our Revolving Credit Facilities. |
The Company (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of corrections of the misstatement on the Company's consolidated balance sheets and consolidated statements of income, comprehensive income (loss) and cash flows | Restatement of Previously Issued Unaudited Condensed Consolidated Financial Statements On May 8, 2018, the Company filed its Annual Report on Form 10-K/A for the year ended December 31, 2016, which amended the Company’s audited consolidated financial statements for each of the years ended December 31, 2016, 2015 and 2014 and the related notes thereto. This Form 10-Q amends the Company’s unaudited condensed consolidated financial statements for the three and six months ended June 30, 2016 and the related notes thereto, included on Form 10-Q filed on August 8, 2016 (“Prior Filing”). The Restatement reflects the correction of the following errors identified for the three and six months ended June 30, 2016 subsequent to the Prior Filing and the impact of restating the three months ended March 31, 2017 on the six months ended June 30, 2017: A. In connection with the accounting for the May 2017 sale of its Construction Claims Group, the Company determined that it had not previously accounted for certain foreign currency gains/losses on intercompany balances and transactions in accordance with accounting principles generally accepted in the United States (“US GAAP”). The Company improperly accounted for the foreign currency effect of certain transactions as if they were long-term investments by including the foreign currency effect in accumulated other comprehensive income instead of properly recording the effect as operating expenses as required under Accounting Standard Codification (ASC) 830 “Foreign Currency Matters.” As a result of these corrections, selling, general and administrative (“SG&A”) expenses increased $270 and $476 for the three and six months ended June 30, 2016, respectively and decreased $1,813 for the six months ended June 30, 2017. B. The Company identified departures from US GAAP under ASC 605-35 “Construction-Type and Production-Type Contracts” in its historical accounting for revenue recognition on nine long-term customer contracts with fee constraints (e.g., fixed fee, lump sum, maximum contract value). The Company enters into agreements for construction management and consulting services with customers, and the guidance of ASC 605-35-15-3D states that contracts for construction consulting services, such as under agency contracts or construction management agreements, fall within the scope of the standard and should follow either Percentage of Completion or Completed Contract methods of accounting. Historically, the Company had not consistently applied the percentage of completion method of revenue recognition. The corrections to properly apply U.S. GAAP to the identified contracts resulted in an increase of $1,574 to revenues for the three months ended June 30, 2016 and increases of $3,130 and $4,155 to revenues for the six months ended June 30, 2017 and 2016, respectively. C. The Company discovered that it had not properly performed the required impairment testing of amortizable intangible assets in accordance with US GAAP in that certain assets no longer in use were not identified and impaired. In addition, an improper useful life was used for some of the Company’s internally developed software assets resulting in an improper amount of amortization expense being recorded in previous periods. The net effect of correcting these errors resulted in a $29 increase in SG&A expense for the six months ended June 30, 2017 and increases of $27 and $55 in SG&A expense for the three and six months ended June 30, 2016, respectively. D. The Company identified other transactions that had been recorded to incorrect accounts and/or in improper amounts. The net corrections of these transactions resulted in a $710 and $762 decrease in revenues for the three and six months ended June 30, 2016, respectively and a $5,421 increase in revenues for the six months ended June 30, 2017; a $5,305 increase in direct expenses for the six months ended June 30, 2017; a decrease of $1,670 and $2,509 in SG&A expenses for the three and six months ended June 30, 2016, respectively and an increase of $473 in SG&A expenses for the six month ended June 30, 2017; a $415 and a $830 increase in interest expense for the three and six months ended June 30, 2016; a $1,593 and $2,399 increase in net loss from discontinued operations for the three and six months ended June 30, 2016, respectively and a $504 decrease in net loss from discontinued operations for the six months ended June 30, 2017; and a $15 and $30 decrease in earnings from noncontrolling interest for the three and six months ended June 30, 2016, respectively and a $58 increase in earnings from noncontrolling interest for the six months ended June 30, 2017. In conjunction with the sale of the construction claims group, interest expense of $415 and $830 for the three and six months ended June 30, 2016, respectively, and interest expense of $552 for the six months ended June 30, 2017 was reclassified from continuing operations to discontinued operations. E. Some of the corrections noted above impacted earnings (loss) before taxes which, in turn, required a calculation of the tax impact. The net impact was an increase in income tax expense of $18 and $308 for the three and six months ended June 30, 2016, respectively and an increase in income tax expense of $695 for the six months ended June 30, 2017. HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS Three Months Ended June 30, 2016 (in thousands, except per share data)
HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS Six Months Ended June 30, 2016 (in thousands, except per share data)
HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Three Months Ended June 30, 2016 (in thousands)
HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Six Months Ended June 30, 2016 (in thousands)
In addition to the items noted above as part of the Restatement, the Company identified departures from US GAAP in its historical preparation and presentation of its statement of cash flows. The Company did not report its cash flows in the reporting currency equivalent of foreign currency using the exchange rates in effect at the time of the cash flows, or an appropriate average rate to approximate the rates in effect at the time of the cash flows. The impact of properly preparing a cash flow statement in each functional currency, translating the cash flow statement using the appropriate rate in effect at the time of a transaction, or substantially equivalent average rate for the period, and consolidation of the individual functional currency cash flows, as prescribed by the guidance in ASC 230, is depicted in the table below. The adjustments noted in the cash flow statements that follow are both a result of items “A” through “E” explained above, as well as the foreign currency effect from cash flow statements prepared in functional currency and appropriately translated. HILL INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOW Six Months Ended June 30, 2016 (in thousands)
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Discontinued Operations and Sale of Business Unit (Tables) |
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Discontinued Operations and Disposal Groups [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of the carrying amounts of assets and liabilities and earnings related to discontinued operations | The carrying amounts of assets and liabilities of the discontinued operations of the Claims Group that were classified as held for sale are as follows (in thousands):
The line items constituting earnings from discontinued operations consist of the following (in thousands):
Adjusted purchase price $129,364 Cash transferred to buyer 4,041 Net proceeds received from Purchaser $125,323 Less net assets held for sale 52,999 Less other adjustments 10,881 Pretax gain on disposal $ 61,443
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Accounts Receivable (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of accounts receivable | The components of accounts receivable are as follows (in thousands):
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Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of acquired intangible assets | The following table summarizes the Company’s acquired intangible assets (in thousands):
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Summary of amortization expense related to intangible assets | Amortization expense related to intangible assets was as follows (in thousands):
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Summary of estimated amortization expense of intangible assets for the next five years | The following table presents the estimated amortization expense based on our present intangible assets for the next five years (in thousands):
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Goodwill (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||
Summary of changes in the Company's carrying value of goodwill | The following table summarizes the changes in the Company’s carrying value of goodwill during 2017 (in thousands):
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Accounts Payable and Accrued Expenses (Tables) |
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Payables and Accruals [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of accounts payable and accrued expenses | Below are the components of accounts payable and accrued expenses (in thousands):
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Notes Payable and Long-Term Debt (Tables) |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of outstanding debt obligations | Outstanding debt obligations are as follows (in thousands):
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Supplemental Cash Flow Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of additional cash flow information | The following table provides additional cash flow information (in thousands):
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Stockholders' Equity (Tables) |
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Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of changes in stockholders' equity | The following table summarizes the changes in stockholders’ equity during the six months ended June 30, 2017 (in thousands):
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Income Taxes (Tables) |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of (loss) earnings before income taxes and the related income tax expense by the United States and foreign jurisdictions | The components of (loss) earnings before income taxes and the related income tax expense by the United States and foreign jurisdictions from continuing operations were as follows (in thousands):
|
Segment and Related Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Revenue by Geographic Region | The following tables present certain information for the Project Management Group’s operations (in thousands): Revenue by Geographic Region
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Operating Profit (Loss) | Operating Profit (Loss)
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Depreciation and Amortization Expense | Depreciation and Amortization Expense
|
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Schedule of Revenue By Client Type | Revenue By Client Type
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property, Plant and Equipment, Net by Geographic Location | Property, Plant and Equipment, Net, by Geographic Location
|
Liquidity (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | 10 Months Ended | 12 Months Ended | 51 Months Ended | |||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
Apr. 30, 2018 |
Dec. 31, 2016 |
Mar. 31, 2017 |
Dec. 31, 2012 |
|
Liquidity [Line Items] | ||||||||
Revenues | $ 125,436 | $ 132,709 | $ 241,556 | $ 269,608 | ||||
Accounts receivable, allowance for doubtful accounts | 66,941 | 66,941 | $ 71,082 | |||||
Middle East and Africa | ||||||||
Liquidity [Line Items] | ||||||||
Revenues | 49,089 | 100,580 | ||||||
Libya | ||||||||
Liquidity [Line Items] | ||||||||
Accounts receivable | $ 59,937 | |||||||
Collection amount applied to receivables | $ 9,511 | |||||||
Iraq | ||||||||
Liquidity [Line Items] | ||||||||
Accounts receivable, allowance for doubtful accounts | 2,788 | 2,788 | ||||||
Accounts receivable written off | 3,593 | |||||||
Oman | ||||||||
Liquidity [Line Items] | ||||||||
Revenues | 14,002 | |||||||
Accounts receivable | 32,058 | 32,058 | ||||||
Collection amount applied to receivables | 19,253 | $ 42,000 | ||||||
Accounts receivable, past due | $ 16,607 | $ 16,607 | ||||||
Oman | Subsequent event | ||||||||
Liquidity [Line Items] | ||||||||
Collection amount applied to receivables | $ 33,905 |
Accounts Receivable - Components of Accounts Receivable (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Components of accounts receivable | ||
Billed | $ 192,430 | $ 200,134 |
Retainage, current portion | 9,415 | 10,824 |
Unbilled | 25,752 | 24,968 |
Accounts receivable, gross | 227,597 | 235,926 |
Allowance for doubtful accounts | (66,941) | (71,082) |
Total | $ 160,656 | $ 164,844 |
Accounts Receivable - General (Details) - MOTC $ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
| |
Accounts Receivable | |
Retainage receivable included in non-current retainage receivable | $ 18,112 |
Retention amount | 9,660 |
Amount of retainage receivable relating to defect and liability period | $ 8,452 |
Percentage of monthly invoice retained | 5.00% |
Percentage of retention released after one year from commencement of DLP | 50.00% |
Period after commencement of DLP for release of retention | 1 year |
Maximum period of DLP | 24 months |
Intangible Assets - Acquired (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Summary of acquired intangible assets | ||
Gross Carrying Amount | $ 20,009 | $ 19,716 |
Accumulated Amortization | 15,044 | 13,710 |
Intangible assets, net | 4,965 | 6,006 |
Client relationship | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 17,094 | 16,699 |
Accumulated Amortization | 12,606 | 11,298 |
Contract | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 2,055 | 2,058 |
Accumulated Amortization | 1,983 | 1,912 |
Trade name | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 860 | 959 |
Accumulated Amortization | $ 455 | $ 500 |
Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense related to intangible assets | $ 504 | $ 1,121 | $ 1,063 | $ 1,993 |
Estimated amortization expense of intangible assets for the next five years | ||||
2017 (remaining 6 months) | 978 | 978 | ||
2018 | 1,088 | 1,088 | ||
2019 | 990 | 990 | ||
2020 | 728 | 728 | ||
2021 | $ 342 | $ 342 |
Goodwill (Details) $ in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
| |
Summary of changes in carrying value of goodwill during 2017 | |
Balance, December 31, 2016 | $ 50,665 |
Translation adjustments | 1,277 |
Balance, June 30, 2017 | $ 51,942 |
Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Components of accounts payable and accrued expenses | ||
Accounts payable | $ 28,049 | $ 30,944 |
Accrued payroll and related expenses | 35,140 | 32,618 |
Accrued subcontractor fees | 11,824 | 9,188 |
Accrued agency fees | 6,379 | 5,702 |
Accrued legal and professional fees | 2,814 | 2,223 |
Other accrued expenses | 3,178 | 5,005 |
Accounts payable and accrued expenses, net | $ 87,384 | $ 85,680 |
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Summary of additional cash flow information | ||
Interest and related financing fees paid | $ 4,026 | $ 5,924 |
Income taxes paid | 4,928 | 7,390 |
Increase (decrease) in other current liabilities and decrease (increase) in additional paid-in capital related to ESA Put Options | (777) | 2,670 |
Increase in additional paid-in capital from the issuance of shares of common stock from cashless exercise of stock options | $ 0 | $ 729 |
Earnings per Share (Details) - shares shares in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Earnings Per Share [Abstract] | ||||
Dilutive stock options (in shares) | 464 | 221 | 562 | 98 |
Total number of shares excluded from diluted earnings per common share | 2,419 | 2,906 | 2,419 | 5,631 |
Income Taxes (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
Dec. 31, 2016 |
|
Income Tax Contingency [Line Items] | |||||
Effective income tax rate (as a percent) | 39.50% | 50.70% | 40.70% | 30.20% | |
Components of (loss) earnings before income taxes | |||||
(Loss) earnings before income taxes | $ (1,645) | $ 5,425 | $ 1,720 | $ 10,617 | |
Income tax expense (benefit), net | (649) | 2,749 | 700 | 3,205 | |
Operating loss carryforwards utilized | 56,000 | ||||
Other liabilities | |||||
Components of (loss) earnings before income taxes | |||||
Reserve for uncertain tax positions | 7,092 | 7,092 | $ 6,735 | ||
U.S. | |||||
Components of (loss) earnings before income taxes | |||||
(Loss) earnings before income taxes | (1,018) | (4,578) | (4,108) | (13,462) | |
Income tax expense (benefit), net | (1,726) | 0 | (1,726) | 0 | |
Foreign | |||||
Components of (loss) earnings before income taxes | |||||
(Loss) earnings before income taxes | (627) | 10,003 | 5,828 | 24,079 | |
Income tax expense (benefit), net | $ 1,077 | $ 2,749 | $ 2,426 | $ 3,205 |
Segment and Related Information - Operating Profit (Loss) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Operating Profit (Loss) | ||||
Operating profit (loss) | $ (1,363) | $ 6,001 | $ 2,751 | $ 11,821 |
Operating segment | U.S. | ||||
Operating Profit (Loss) | ||||
Operating profit (loss) | 7,104 | 5,320 | 11,380 | 8,148 |
Operating segment | Latin America | ||||
Operating Profit (Loss) | ||||
Operating profit (loss) | (2,142) | 1,292 | (2,519) | 2,187 |
Operating segment | Europe | ||||
Operating Profit (Loss) | ||||
Operating profit (loss) | 2,393 | (2,753) | 3,818 | (1,240) |
Operating segment | Middle East | ||||
Operating Profit (Loss) | ||||
Operating profit (loss) | 4,567 | 8,083 | 11,362 | 18,645 |
Operating segment | Africa | ||||
Operating Profit (Loss) | ||||
Operating profit (loss) | (1,490) | 1,048 | (715) | (1,115) |
Operating segment | Asia/Pacific | ||||
Operating Profit (Loss) | ||||
Operating profit (loss) | (574) | 77 | (447) | 811 |
Corporate | ||||
Operating Profit (Loss) | ||||
Operating profit (loss) | $ (11,221) | $ (7,066) | $ (20,128) | $ (15,615) |
Segment and Related Information - Depreciation and Amortization Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Depreciation and Amortization Expense | ||||
Depreciation and amortization expense | $ 1,660 | $ 2,303 | $ 3,255 | $ 4,209 |
Operating segment | Project Management | ||||
Depreciation and Amortization Expense | ||||
Depreciation and amortization expense | 1,453 | 2,124 | 2,975 | 3,974 |
Corporate | ||||
Depreciation and Amortization Expense | ||||
Depreciation and amortization expense | $ 207 | $ 179 | $ 280 | $ 235 |
Segment and Related Information - Property, Plant and Equipment, Net by Geographic Location (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | $ 14,880 | $ 16,389 |
U.S./Canada | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 11,347 | 12,626 |
Latin America | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 792 | 881 |
Europe | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 1,103 | 218 |
Middle East | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 1,371 | 1,645 |
North Africa | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 127 | 169 |
Asia/Pacific | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | $ 140 | $ 850 |
Commitments and Contingencies - General Litigation and Acquisition-Related Contingencies (Details) R$ in Thousands, $ in Thousands |
12 Months Ended | |||||
---|---|---|---|---|---|---|
Oct. 05, 2015
USD ($)
|
Feb. 28, 2011 |
Dec. 31, 2015
USD ($)
|
Dec. 31, 2013
USD ($)
|
Jun. 30, 2017
USD ($)
|
Jun. 17, 2016
BRL (R$)
|
|
ESA | ||||||
Acquisition-Related Contingencies | ||||||
Value of shares purchased on exercise of Put Options | $ 2,618 | R$ 8,656 | ||||
M.A. Angeliades, Inc. 2013 Complaint | ||||||
Acquisition-Related Contingencies | ||||||
Possible loss contingency | $ 8,771 | |||||
Settlement amount | $ 2,596 | |||||
Interest amount | 1,056 | |||||
Interest accrued | $ 448 | |||||
Interest amount charged to expense | $ 608 | |||||
Hill Spain | ESA | ||||||
Acquisition-Related Contingencies | ||||||
Ownership interest | 91.00% | |||||
Multiple of earnings for determining purchase price of minority shares | 7 | |||||
Call option purchase price premium if exercised by Hill Spain (as a percent) | 5.00% | |||||
Call/put option exercise period after audited financial statements | 3 months |
Commitments and Contingencies- Other (Details) $ in Thousands |
6 Months Ended | 12 Months Ended | |
---|---|---|---|
Jul. 13, 2015
USD ($)
employee
|
Jun. 30, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
|
|
Grant received | $ 1,000 | ||
Minimum capital expenditure required to be made to receive grant | $ 6,425 | ||
Minimum term of lease | 7 years | ||
Minimum persons to be employed | employee | 359 | ||
Term of lease | 12 years | ||
Tenant improvement allowance from landlord | $ 3,894 | ||
Amortization period for tenant improvements | 12 years | ||
Other liabilities | |||
Potential tax liability related to certain foreign subsidiaries | $ 2,132 | ||
Tenant improvement allowance from landlord | $ 3,894 | ||
Amortization period for tenant improvements | 12 years | ||
Other liabilities | Discontinued Operations | |||
Potential tax liability related to certain foreign subsidiaries | $ 444 |
Subsequent Events - Finalization of ESA Put Option (Details) - Subsequent event - ESA R$ in Thousands, $ in Thousands |
1 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|
Mar. 31, 2018
USD ($)
|
Mar. 31, 2018
BRL (R$)
|
Feb. 28, 2018
USD ($)
|
Feb. 28, 2018
BRL (R$)
|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2017
BRL (R$)
|
|
Acquisitions | ||||||
Reduced total payment to acquire business | $ 1,841 | R$ 6,084 | ||||
Adjustment to additional paid-in capital | $ 953 | R$ 3,146 | $ 1,365 | R$ 4,475 |
Subsequent Events - Performance Guarantee (Details) $ in Thousands |
Feb. 08, 2018
USD ($)
|
---|---|
Subsequent event | Forecast | |
Subsequent events | |
Amount of performance guaranteed | $ 7,927 |
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