Delaware | No. 20-1195343 |
(State or other jurisdiction of | (I.R.S. Employer |
Incorporation or organization) | Identification No.) |
333 Washington Street, Suite 201 | |
Jersey City, New Jersey | 07302 |
(Address of principal executive offices) | (Zip Code) |
Title of Each Class | Name of Each Exchange on Which Registered |
Common Stock, $.0001 par value per share | The NASDAQ Capital Market |
Large accelerated filer | Accelerated filer |
Non-accelerated filer | Smaller reporting company X |
Emerging growth company |
Business | |||
Risk Factors | |||
Unresolved Staff Comments | |||
Properties | |||
Legal Proceedings | |||
Mine Safety Disclosures | |||
Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | |||
Selected Financial Data | |||
Management's Discussion and Analysis of Financial Condition and Results of Operations | |||
Quantitative and Qualitative Disclosures About Market Risk | |||
Financial Statements and Supplementary Data | |||
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | |||
Controls and Procedures | |||
Other Information | |||
Directors, Executive Officers and Corporate Governance | |||
Executive Compensation | |||
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | |||
Certain Relationships and Related Transactions, and Director Independence | |||
Principal Accountant Fees and Services | |||
Exhibits and Financial Statement Schedules |
• | anticipated financial position and liquidity, growth opportunities and growth rates, acquisition and divestiture opportunities, business prospects, regulatory and competitive outlook, investment and expenditure plans, investment results, strategic alternatives, business strategies, and other similar statements of expectations or objectives; |
• | our expectations of vessels’ useful lives and the estimated obligations, and the timing thereof, relating to vessel repair or maintenance work; |
Self-Unloading Bulk Carriers | ||||
Vessel Name | Dimensions | Horsepower | Year Built/Rebuilt | Cargo capacity at mid-summer draft in gross tons |
Canadian-flagged: | ||||
Cuyahoga | 620x60x35 | 3,084 | 1943/1974/2000 | 15,675 |
Michipicoten | 698x70x37 | 8,160 | 1952/1980/2011 | 22,300 |
Mississagi | 620x60x35 | 4,500 | 1943/1967/1985 | 15,800 |
Robert S. Pierson | 630x68x37 | 5,598 | 1974 | 19,650 |
Saginaw | 640x72x36 | 8,160 | 1953/2008 | 20,200 |
Manitoulin | 664x78x45 | 6,050 | 1991/2015 | 28,610 |
U.S.-flagged: | ||||
Calumet | 630x68x37 | 5,598 | 1973 | 19,650 |
Manitowoc | 630x68x37 | 5,598 | 1973 | 19,650 |
Manistee | 620x60x35 | 2,950 | 1943/1964/1976 | 14,900 |
Straight Deck Bulk carriers (all Canadian-flagged) | ||||
Vessel Name | Dimensions | Horsepower | Year Built/Rebuilt | Cargo capacity at mid-summer draft in gross tons |
Kaministiqua | 730x75x48 | 11,679 | 1983 | 33,824 |
Ojibway | 642x67x35 | 4,100 | 1952/2005 | 20,668 |
Tecumseh | 640x78x45 | 12,000 | 1972 | 29,984 |
Self-Unloading Articulated Tug and Barge Units (all U.S.-flagged) | ||||
Vessel Name | Dimensions | Horsepower | Year Built/Rebuilt | Cargo capacity at mid-summer draft in gross tons |
Barge Ashtabula | 700x78x51 | 1982 | 28,959 | |
Tug Defiance | 7,200 | 1982 | ||
Barge James L. Kuber | 815x70x36 | 1953/1983/2007 | 25,500 | |
Tug Victory | 7,994 | 1981 | ||
Barge Lewis J. Kuber | 728x70x37 | 1952/1980/2006 | 22,300 | |
Tug Olive L. Moore | 6,600 | 1928 |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||||
Revenue by country: | ||||||||
Canada | $ | 67,907 | $ | 86,977 | ||||
United States | 47,544 | 61,467 | ||||||
$ | 115,451 | $ | 148,444 |
March 31, 2017 | March 31, 2016 | ||||||
Property and equipment by country: | |||||||
Canada | $ | 107,884 | $ | 116,719 | |||
United States | 106,162 | 111,785 | |||||
$ | 214,046 | $ | 228,504 | ||||
Intangible assets by country: | |||||||
Canada | $ | 2,910 | $ | 3,652 | |||
United States | 1,917 | 2,252 | |||||
$ | 4,827 | $ | 5,904 | ||||
Goodwill by country: | |||||||
Canada | $ | 8,284 | $ | 8,284 | |||
United States | 1,909 | 1,909 | |||||
$ | 10,193 | $ | 10,193 |
o | incur additional indebtedness; |
o | create additional liens on its assets; |
o | sell or acquire assets or businesses; |
o | change the nature of our businesses; |
o | make investments; |
o | engage in mergers or acquisitions or transactions with related parties; or |
o | pay dividends. |
o | global and regional economic conditions; |
o | developments in international and Great Lakes trade; |
o | changes in seaborne and other transportation patterns, such as port congestion and canal closures; |
o | weather, water levels and crop yields; |
o | global and regional political developments, including armed conflicts and terrorist activities; and |
o | embargoes and strikes. |
o | changes in environmental and other regulations that may limit the useful life of vessels; |
o | changes in Great Lakes dry bulk commodity supply and demand; |
o | types, sizes, and ages of vessels; |
o | development of and increases in use of other modes of transportation; |
o | costs of new buildings; |
o | technological advances; |
o | governmental or other regulations; |
o | natural disasters and other disruptions of trade; and |
o | prevailing level of contract of affreightment rates and charter rates. |
◦ | damage or destruction of a vessel due to marine disaster such as a collision; |
◦ | the loss of a vessel due to piracy and terrorism; |
◦ | cargo and property losses or damage as a result of the foregoing or less drastic causes such as human error, mechanical failure, low water levels and bad weather; |
◦ | environmental accidents as a result of the foregoing; and |
◦ | business interruptions and delivery delays caused by mechanical failure, human error, war, terrorism, political action in various countries, labor strikes or adverse weather conditions. |
o | Lower Lakes Towing leases approximately 12,000 square feet of warehouse space at 107 Greenock Street, Port Dover, Ontario under a lease that expires on August 31, 2022. |
o | Lower Lakes Towing leases approximately 24,800 square feet of warehouse space at 109 Greenock Street, Port Dover, Ontario under a lease that expires on August 31, 2022. |
o | Lower Lakes Towing leases approximately 3,000 square feet of office space at 517 Main Street, Port Dover, Ontario under a lease that expires in October, 2018. |
o | Grand River leases approximately 4,400 square feet at 1028 Hannah Street, Suite D, Traverse City, Michigan under a lease that expires on September 30, 2020. |
Common Stock | ||
Quarter Ended | High | Low |
June 30, 2015 | $3.67 | $3.08 |
September 30, 2015 | $3.34 | $2.05 |
December 31, 2015 | $2.68 | $1.46 |
March 31, 2016 | $1.67 | $0.74 |
June 30, 2016 | $1.37 | $0.73 |
September 30, 2016 | $1.23 | $0.75 |
December 31, 2016 | $2.95 | $0.68 |
March 31, 2017 | $1.42 | $0.51 |
(USD in 000's) | Year ended March 31, 2017 | Year ended March 31, 2016 | $ Change | % Change | ||||||||
Revenue: | ||||||||||||
Freight and related revenue | $ | 110,516 | $ | 123,591 | $ | (13,075 | ) | (10.6 | )% | |||
Fuel and other surcharges | 4,935 | 11,547 | (6,612 | ) | (57.3 | )% | ||||||
Outside voyage charter revenue | — | 13,306 | (13,306 | ) | (100 | )% | ||||||
Total | $ | 115,451 | $ | 148,444 | $ | (32,993 | ) | (22.2 | )% | |||
Expenses: | ||||||||||||
Outside voyage charter fees | — | 13,416 | (13,416 | ) | (100 | )% | ||||||
Vessel operating expenses | 67,186 | 83,362 | (16,176 | ) | (19.4 | )% | ||||||
Repairs and maintenance | 5,932 | 5,849 | 83 | 1.4 | % | |||||||
Operating income plus depreciation, amortization of drydock costs, amortization of intangibles, (gain) on foreign exchange, one-time equity based severance costs, restructuring charges, and impairment charges on retired assets. | $ | 26,847 | $ | 32,440 | $ | (5,593 | ) | (17.2 | )% | |||
OPERATING (LOSS) INCOME | $ | (279 | ) | $ | 8,447 | $ | (8,726 | ) | (103.3 | )% | ||
Sailing Days: | 3,601 | 3,911 | (310 | ) | (7.9 | )% | ||||||
Number of vessels operated: | 14 | 16 | (2 | ) | (12.5 | )% | ||||||
Per day in whole USD: | ||||||||||||
Revenue per Sailing Day: | ||||||||||||
Freight and related revenue | $ | 30,690 | $ | 31,601 | $ | (911 | ) | (2.9 | )% | |||
Fuel and other surcharges | $ | 1,370 | $ | 2,952 | $ | (1,582 | ) | (53.6 | )% | |||
Expenses per Sailing Day: | ||||||||||||
Vessel operating expenses | $ | 18,658 | $ | 21,315 | $ | (2,657 | ) | (12.5 | )% | |||
Repairs and maintenance | $ | 1,647 | $ | 1,496 | $ | 151 | 10.1 | % |
The following table provides a reconciliation of operating income plus depreciation, amortization of drydock costs, amortization of intangibles, (gain) loss on foreign exchange, one-time equity based severance costs, restructuring charges, and impairment charges on retired assets during the fiscal years ended March 31, 2017 and March 31, 2016 (USD in 000's): | ||||||
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||
Operating (Loss) Income | $ | (279 | ) | $ | 8,447 | |
Depreciation | 20,908 | 18,915 | ||||
Amortization of drydock costs | 3,104 | 3,507 | ||||
Amortization of intangibles | 1,001 | 1,081 | ||||
Gain on foreign exchange | (2,134 | ) | (68 | ) | ||
Equity-based severance costs | — | 558 | ||||
Restructuring charges | 2,375 | — | ||||
Impairment charges on retired asset | 1,872 | — | ||||
Operating income plus depreciation, amortization of drydock costs, amortization of intangibles, (gain) loss on foreign exchange, one-time equity based severance costs, restructuring charges, and impairment charges on retired assets. | $ | 26,847 | $ | 32,440 |
(USD in 000's) | Sailing Days | Freight and related revenue | Fuel and other surcharges | Outside voyage charter revenue | Total revenue | Outside voyage charter fees | Vessel operating expenses | Repairs and maintenance | General and administrative | *Subtotal | ||||||||||||||||||||||||||||
Year ended March 31, 2016 | 3,911 | $ | 123,591 | $ | 11,547 | $ | 13,306 | $ | 148,444 | $ | 13,416 | $ | 83,362 | $ | 5,849 | $ | 13,935 | $ | 31,882 | |||||||||||||||||||
Changes in the twelve month period ended March 31, 2017: | ||||||||||||||||||||||||||||||||||||||
Change attributable to Canadian dollar exchange rate | — | (781 | ) | (29 | ) | — | (810 | ) | — | (415 | ) | (32 | ) | (54 | ) | (309 | ) | |||||||||||||||||||||
Net change on a constant currency basis | (310 | ) | (12,294 | ) | (6,583 | ) | — | (18,877 | ) | — | (15,761 | ) | 115 | 1,605 | (4,836 | ) | ||||||||||||||||||||||
Changes in outside voyage charter revenue and fees on a constant currency basis | — | — | — | (13,306 | ) | (13,306 | ) | (13,416 | ) | — | — | — | 110 | |||||||||||||||||||||||||
Total Change | (310 | ) | $ | (13,075 | ) | $ | (6,612 | ) | $ | (13,306 | ) | $ | (32,993 | ) | $ | (13,416 | ) | $ | (16,176 | ) | $ | 83 | $ | 1,551 | $ | (5,035 | ) | |||||||||||
Year ended March 31, 2017 | 3,601 | $ | 110,516 | $ | 4,935 | $ | — | $ | 115,451 | $ | — | $ | 67,186 | $ | 5,932 | $ | 15,486 | $ | 26,847 |
• | A revolving credit facility under which Lower Lakes Towing may borrow up to US $80 million (CDN or USD currency to be selected by Lower Lakes Towing) with a final maturity date of March 31, 2019 (the "Canadian Revolving Facility"); |
• | A revolving credit facility under which Lower Lakes Transportation, Grand River and Black Creek may borrow up to USD $90 million with a final maturity date of March 31, 2019 (the "U.S. Revolving Facility," and collectively with the Canadian Revolving Facility, the "Revolving Facilities"); |
• | A swing line facility under which Lower Lakes Towing may borrow up to the lesser of CDN $8 million and the CDN maximum borrowing availability less the outstanding balance of the Canadian Revolving Facility, with a final maturity date of March 31, 2019 (the "Canadian Swing Line Facility"); and |
• | A swing line facility under which Lower Lakes Transportation, Grand River and Black Creek may borrow up to USD $9 million, less the outstanding balance of the U.S. Revolving Facility, with a final maturity date of March 31, 2019 (the "U.S. Swing Line Facility"). |
• | Canadian Revolving Facility: if funded in Canadian Dollars, the BA Rate (as defined in the First Lien Credit Agreement) or, at the borrower’s option, the Canadian Prime Rate (as defined in the First Lien Credit Agreement) and if funded in U.S. Dollars, the Canadian Base Rate (as defined in the First Lien Credit Agreement) or, at the borrower’s option, the LIBOR Rate (as defined in the First Lien Credit Agreement); |
• | U.S. Revolving Facility: the U.S. Base Rate (as defined in the First Lien Credit Agreement) or, at the borrower’s option, the LIBOR Rate; |
• | Canadian Swing Line Facility: the Canadian Prime Rate or, at the borrower’s option, the Canadian Base Rate; and |
• | U.S. Swing Line Facility: the U.S. Base Rate. |
• | obtain the customer's consent to us as the new owner, if applicable; |
• | arrange for a new crew for the vessel; |
• | replace all hired equipment on board, such as gas cylinders and communication equipment; |
• | negotiate and enter into new insurance contracts for the vessel through our own insurance brokers; and |
• | implement a new planned maintenance program for the vessel. |
• | employment and operation of our drybulk vessels; |
• | scheduling our vessels to satisfy customer's contracts of affreightment; and |
• | management of the financial, general and administrative elements involved in the conduct of our business and ownership of our drybulk vessels. |
• | vessel maintenance and repair; |
• | crew selection and training; |
• | vessel spares and stores supply; |
• | planning and undergoing drydocking, special surveys and other major repairs; |
• | organizing and undergoing regular classification society surveys; |
• | contingency response planning; |
• | onboard safety procedures auditing; |
• | accounting; |
• | vessel insurance arrangement; |
• | vessel scheduling; |
• | vessel security training and security response plans (ISPS); |
• | obtain ISM (International Safety Management) certification and audit for each vessel within six months of taking over a vessel; |
• | vessel hire management; |
• | vessel surveying; and |
• | vessel performance monitoring. |
• | management of our financial resources, including banking relationships (e.g., administration of bank loans); |
• | management of our accounting system and records and financial reporting; |
• | management of our human resources; |
• | management of our investor relations; |
• | administration of the legal and regulatory requirements affecting our business and assets; and |
• | management of the relationships with our service providers and customers. |
• | rates of contracts of affreightment and charterhire; |
• | scheduling to match vessels with customer requirements, including dock limitations, vessel trade patterns and backhaul opportunities; |
• | weather conditions; |
• | vessel incidents; |
• | levels of vessel operating expenses; |
• | depreciation and amortization expenses; |
• | financing costs; and |
• | fluctuations in foreign exchange rates. |
Customer relationships and contracts | 15 years straight-line |
Vessels | 5 - 30 years straight-line |
Leasehold improvements | 7 - 11 years straight-line |
Purchased software | 3 years straight-line |
Vehicles | 20% declining-balance |
Furniture and equipment | 20% declining-balance |
Computer equipment | 45% declining-balance |
Communication equipment | 20% declining-balance |
Jurisdiction | Open Tax Years (Fiscal Years) |
Federal (U.S.A) | 2014 – 2017 |
Various states | 2013 – 2017 |
Federal (Canada) | 2012 – 2017 |
Ontario | 2012 – 2017 |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, Rights and Unvested Restricted Stock | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plan |
Equity compensation plans approved by security holders | 462,211* | $2.98 | 25,886 |
Equity compensation plans not approved by security holders | — | — | — |
Total | 462,211* | $2.98 | 25,886 |
1. | The financial statements at page F-1 are filed as a part of this Annual Report on Form 10-K. |
2. | Financial statement schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto. |
3. | Exhibits included or incorporated herein: |
Exhibit No. | Description |
2.1 | Stock Purchase Agreement, dated as of September 2, 2005, among Rand Acquisition Corporation, LL Acquisition Corp. and the stockholders of Lower Lakes Towing Ltd. (1) |
2.2 | Amendment to Stock Purchase Agreement, dated December 29, 2005. (2) |
2.3 | Amendment to Stock Purchase Agreement, dated January 27, 2006. (3) |
2.4 | Amendment to Stock Purchase Agreement, dated February 27, 2006. (4) |
3.1 | Second Amended and Restated Certificate of Incorporation, filed with the Secretary of State of the State of Delaware on September 8, 2016. (6) |
3.2 | Amended and Restated Certificate of Designations, filed with the Secretary of State of the State of Delaware on August 8, 2006. (7) |
3.3 | Third Amended and Restated By-laws. (6) |
4.1 | Specimen Common Stock Certificate. (5) |
10.1* | Rand Logistics, Inc. 2007 Long-Term Incentive Plan, dated July 26, 2007. (8) |
10.2* | Employment Agreement, dated June 12, 2013, by and between Rand Logistics, Inc. and Laurence S. Levy. (9) |
10.3* | Employment Agreement, dated June 12, 2013, by and between Rand Logistics, Inc. and Edward Levy. (9) |
10.4 | Memorandum of Agreement, dated March 11, 2014, by and between Uni-Tankers M/T “Lalandia Swan” ApS and Lower Lakes Towing Ltd. (10) |
10.5 | Agreement, dated as of September 22, 2014, by and between the Company and JWEST, LLC. (11) |
10.6* | First Amendment to Employment Agreement, dated November 5, 2014, by and between Rand Logistics, Inc. and Laurence S. Levy. (12) |
10.7* | First Amendment to Employment Agreement, dated November 5, 2014, by and between Rand Logistics, Inc. and Edward Levy. (12) |
10.8 | Credit Agreement, dated March 27, 2015, by and among Lower Lakes Towing Ltd., Lower Lakes Transportation Company, Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., the guarantors party thereto, Bank of America, N.A., as agent, and the lenders party thereto. (13) |
10.9 | Term Loan Credit Agreement as of March 27, 2015, by and among Lower Lakes Towing Ltd., Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., the guarantors party thereto, Guggenheim Corporate Funding, LLC, as agent, and the lenders party thereto, as amended. (13) |
10.10 | Intercreditor Agreement, dated March 27, 2015, by and among Bank of America, N.A., Guggenheim Corporate Funding, LLC, Lower Lakes Towing Ltd., Lower Lakes Transportation Company, Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., and the obligors party thereto. (13) |
10.11* | Offer Letter, dated May 7, 2015, by and between Rand Logistics, Inc. and Mark Hiltwein. (14) |
10.12 | Amendment No. 1 and Waiver Agreement, dated February 9, 2016, by and among Lower Lakes Towing Ltd., Lower Lakes Transportation Company, Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as borrowers, Bank of America, N.A., as agent, and the lenders party thereto. (15) |
10.13 | Third Amendment and Waiver Under Term Loan Credit Agreement, dated February 9, 2016 by and among Lower Lakes Towing Ltd., Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as borrowers, Guggenheim Corporate Funding, LLC, as agent, and the lenders party thereto. (15) |
10.14 | Amendment No. 2 and Waiver Agreement, dated as of August 26, 2016, by and among Lower Lakes Towing Ltd., Lower Lakes Transportation Company, Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as borrowers, Bank of America, N.A., as agent, and the lenders party thereto. (16) |
10.15 | Fourth Amendment and Waiver To Term Loan Credit Agreement, dated as of August 26, 2016, by and among Lower Lakes Towing Ltd., Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as the credit parties, Guggenheim Corporate Funding, LLC, as agent, and the lenders party thereto. (16) |
10.16 | Amendment No. 4 and Waiver to Credit Agreement, dated as of May 31, 2017, by and among Lower Lakes Towing Ltd., Lower Lakes Transportation Company, Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as borrowers, Bank of America, N.A., as agent, and the lenders party thereto. (17) |
10.17 | Fifth Amendment and Waiver to Credit Agreement, dated as of May 31, 2017, by and among Lower Lakes Towing Ltd., Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as the credit parties, Guggenheim Corporate Funding, LLC, as agent, and Lightship Capital LLC, as the lender. (17) |
10.18 | First Amendment to Amendment No. 4 and Waiver to Credit Agreement, dated as of June 14, 2017, by and among Lower Lakes Towing Ltd., Lower Lakes Transportation Company, Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as borrowers, Bank of America, N.A., as agent, and the lenders party thereto. (18) |
10.19 | First Amendment to Fifth Amendment and Waiver to Credit Agreement, dated as of June 14, 2017, by and among Lower Lakes Towing Ltd., Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as the credit parties, Guggenheim Corporate Funding, LLC, as agent, and Lightship Capital LLC, as the lender. (18) |
10.20† | Second Amendment to Amendment No. 4 and Waiver to Credit Agreement, dated as of June 30, 2017, by and among Lower Lakes Towing Ltd., Lower Lakes Transportation Company, Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as borrowers, Bank of America, N.A., as agent, and the lenders party thereto. |
10.21† | Second Amendment to Fifth Amendment and Waiver to Credit Agreement, dated as of June 30, 2017, by and among Lower Lakes Towing Ltd., Grand River Navigation Company, Inc., Black Creek Shipping Company, Inc., as the credit parties, Guggenheim Corporate Funding, LLC, as agent, and Lightship Capital LLC, as the lender. |
21.1† | Subsidiaries of Rand. |
23.1† | Consent of Grant Thornton LLP, independent registered public accounting firm. |
31.1† | Certification of Principal Executive Officer pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2† | Certification of Chief Financial Officer pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1*** | Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2*** | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS† | XBRL Instance Document. |
101.SCH† | XBRL Taxonomy Extension Schema Document. |
101.CAL† | XBRL Taxonomy Extension Calculation Linkbase Document. |
101.DEF† | XBRL Taxonomy Extension Definition Linkbase Document. |
101.LAB† | XBRL Taxonomy Extension Label Linkbase Document. |
101.PRE† | XBRL Taxonomy Extension Presentation Linkbase Document. |
(1) | Incorporated by reference to the Registrant's Amended Quarterly Report on Form 10-QSB/A, filed with the Securities and Exchange Commission on January 20, 2006 (SEC File No. 000-50908). |
(2) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on January 3, 2006 (SEC File No. 000-50908). |
(3) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on January 31, 2006 (SEC File No. 000-50908). |
(4) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on March 1, 2006 (SEC File No. 000-50908). |
(5) | Incorporated by reference to the Registrant's Registration Statement on Form S-1, filed with the Securities and Exchange Commission on June 30, 2004 (SEC File No. 333-117051). |
(6) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on September 12, 2016 (SEC File No. 000-50908). |
(7) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on August 10, 2006 (SEC File No. 000-50908). |
(8) | Incorporated by reference to the Registrant's Proxy Statement on Schedule 14A, filed with the Securities and Exchange Commission on July 27, 2012 (SEC File No. 001-33345). |
(9) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 14, 2013 (SEC File No. 001-33345). |
(10) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on March 17, 2014 (SEC File No. 001-33345). |
(11) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on September 22, 2014 (SEC File No. 001-33345). |
(12) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on November 7, 2014 (SEC File No. 001-33345). |
(13) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on April 1, 2015 (SEC File No. 001-33345). |
(14) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on May 13, 2015 (SEC File No. 001-33345). |
(15) | Incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on February 9, 2016 (SEC File No. 001-33345). |
(16) | Incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on August 8, 2016 (SEC File No. 001-33345). |
(17) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 2, 2017 (SEC File No. 001-33345). |
(18) | Incorporated by reference to the Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 14, 2017 (SEC File No. 001-33345). |
RAND LOGISTICS, INC. | |||
By: | /s/ Edward Levy | ||
Edward Levy | |||
President, Chief Executive Officer and Director | |||
Signature | Title | Date |
/s/ Edward Levy | President, Chief Executive Officer and Director | July 5, 2017 |
Edward Levy | (Principal Executive Officer) | |
/s/ Mark S. Hiltwein | Chief Financial Officer | July 5, 2017 |
Mark S. Hiltwein | (Principal Financial Officer) | |
/s/ Laurence S. Levy | Director | July 5, 2017 |
Laurence S. Levy | ||
/s/ H. Cabot Lodge, III | Director | July 5, 2017 |
H. Cabot Lodge, III | ||
/s/ James K. Thompson | Director | July 5, 2017 |
James K. Thompson | ||
/s/ Michael D. Lundin | Director | July 5, 2017 |
Michael D. Lundin | ||
/s/ John Binion | Director | July 5, 2017 |
John Binion | ||
/s/ Robert K. Kurz | Director | July 5, 2017 |
Robert K. Kurz |
Report of Independent Registered Public Accounting Firm | |
Consolidated Balance Sheets as of March 31, 2017 and 2016 | |
Consolidated Statements of Operations for the years ended March 31, 2017 and 2016 | |
Consolidated Statements of Comprehensive Loss for the years ended March 31, 2017 and 2016 | |
Consolidated Statements of Stockholders' Equity for the years ended March 31, 2017 and 2016 | |
Consolidated Statements of Cash Flows for the years ended March 31, 2017 and 2016 | |
Notes to Consolidated Financial Statements |
Mississauga, Ontario, Canada | /s/ Grant Thornton LLP | |
July 5, 2017 | Chartered Professional Accountants | |
Licensed Public Accountants |
March 31, 2017 | March 31, 2016 | ||||||
ASSETS | |||||||
CURRENT | |||||||
Cash and cash equivalents | $ | 335 | $ | 77 | |||
Accounts receivable, net (Note 5) | 4,101 | 2,697 | |||||
Income taxes receivable | 46 | 47 | |||||
Prepaid expenses and other current assets (Notes 6 and 9) | 6,209 | 6,320 | |||||
Total current assets | 10,691 | 9,141 | |||||
PROPERTY AND EQUIPMENT, NET (Note 8) | 214,046 | 228,504 | |||||
OTHER ASSETS (Note 9) | 41 | 102 | |||||
DEFERRED DRYDOCK COSTS, NET (Note 10) | 8,802 | 6,660 | |||||
INTANGIBLE ASSETS, NET (Note 11) | 4,827 | 5,904 | |||||
GOODWILL (Note 11) | 10,193 | 10,193 | |||||
Total assets | $ | 248,600 | $ | 260,504 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
CURRENT | |||||||
Accounts payable | 9,070 | 17,822 | |||||
Accrued liabilities (Note 13) | 15,220 | 8,144 | |||||
Other current liability | 404 | 776 | |||||
Income taxes payable | — | 34 | |||||
Current portion of deferred payment liability | — | 564 | |||||
Long-term debt, net, classified as current (Note 14) | 119,702 | — | |||||
Subordinated debt, net, classified as current (Note 15) | 80,577 | — | |||||
Total current liabilities | 224,973 | 27,340 | |||||
LONG-TERM DEBT, NET (Note 14) | — | 112,426 | |||||
SUBORDINATED DEBT, NET (Note 15) | — | 75,317 | |||||
DEFERRED INCOME TAXES, NET (Note 7) | 4,367 | 5,825 | |||||
Total liabilities | 229,340 | 220,908 | |||||
COMMITMENTS AND CONTINGENCIES (Notes 16 and 17) | |||||||
STOCKHOLDERS' EQUITY | |||||||
Preferred stock, $.0001 par value, Authorized 1,000,000 shares, Issued and outstanding 295,480 shares at March 31, 2017 and at March 31, 2016 (Note 18) | 14,674 | 14,674 | |||||
Common stock, $.0001 par value, Authorized 50,000,000 shares, Issued and outstanding 18,633,149 shares at March 31, 2017 and 18,359,397 shares at March 31, 2016 (Note 18) | 1 | 1 | |||||
Additional paid-in capital | 91,348 | 90,993 | |||||
Accumulated deficit | (76,408 | ) | (56,537 | ) | |||
Accumulated other comprehensive loss | (10,355 | ) | (9,535 | ) | |||
Total stockholders’ equity | 19,260 | 39,596 | |||||
Total liabilities and stockholders’ equity | $ | 248,600 | $ | 260,504 |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||||
REVENUE | ||||||||
Freight and related revenue | $ | 110,516 | $ | 123,591 | ||||
Fuel and other surcharges | 4,935 | 11,547 | ||||||
Outside voyage charter revenue (Note 19) | — | 13,306 | ||||||
TOTAL REVENUE | 115,451 | 148,444 | ||||||
EXPENSES | ||||||||
Outside voyage charter fees (Note 19) | — | 13,416 | ||||||
Vessel operating expenses | 67,186 | 83,362 | ||||||
Repairs and maintenance | 5,932 | 5,849 | ||||||
General and administrative | 15,486 | 13,935 | ||||||
Depreciation | 20,908 | 18,915 | ||||||
Amortization of drydock costs | 3,104 | 3,507 | ||||||
Amortization of intangibles | 1,001 | 1,081 | ||||||
(Gain) on foreign exchange, net | (2,134 | ) | (68 | ) | ||||
Restructuring charges (Note 21) | 2,375 | — | ||||||
Impairment charges on retired asset (Note 8) | 1,872 | — | ||||||
TOTAL EXPENSES | 115,730 | 139,997 | ||||||
OPERATING (LOSS) INCOME | (279 | ) | 8,447 | |||||
OTHER INCOME AND EXPENSES | ||||||||
Interest expense (Note 20) | 19,463 | 12,461 | ||||||
Interest and other income | (19 | ) | (14 | ) | ||||
Total Other Income and Expenses | 19,444 | 12,447 | ||||||
LOSS BEFORE INCOME TAXES | (19,723 | ) | (4,000 | ) | ||||
(RECOVERY) PROVISION FOR INCOME TAXES (Note 7) | ||||||||
Current | (36 | ) | 51 | |||||
Deferred | (1,459 | ) | 181 | |||||
Total (Recovery) Provision for Income Taxes | (1,495 | ) | 232 | |||||
NET LOSS BEFORE PREFERRED STOCK DIVIDENDS | (18,228 | ) | (4,232 | ) | ||||
PREFERRED STOCK DIVIDENDS | 1,643 | 1,333 | ||||||
LOSS APPLICABLE TO COMMON STOCKHOLDERS | $ | (19,871 | ) | $ | (5,565 | ) | ||
Net loss per share - basic and diluted (Note 24) | $ | (1.08 | ) | $ | (0.31 | ) | ||
Weighted average shares outstanding - basic and diluted | 18,411,690 | 18,045,935 |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||||
NET LOSS BEFORE PREFERRED STOCK DIVIDENDS | $ | (18,228 | ) | $ | (4,232 | ) | ||
Other comprehensive loss: | ||||||||
Change in foreign currency translation adjustment | (820 | ) | (1,723 | ) | ||||
COMPREHENSIVE LOSS BEFORE PREFERRED STOCK DIVIDENDS | $ | (19,048 | ) | $ | (5,955 | ) |
Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Stockholders' Equity | |||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Amount | Amount | Amount | Amount | |||||||||||||||||||||||
Balances, March 31, 2015 | 300,000 | $ | 14,900 | 18,035,427 | $ | 1 | $ | 90,130 | $ | (50,972 | ) | $ | (7,812 | ) | $ | 46,247 | ||||||||||||||
Net loss | — | — | — | — | — | (4,232 | ) | — | (4,232 | ) | ||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | (1,333 | ) | — | (1,333 | ) | ||||||||||||||||||||
Restricted stock issued (Note 18) | — | — | 13,801 | — | 25 | — | — | 25 | ||||||||||||||||||||||
Unrestricted stock issued (Note 18) | — | — | 264,814 | — | 524 | — | — | 524 | ||||||||||||||||||||||
Restricted stock units granted | — | — | 8,905 | — | 57 | — | — | 57 | ||||||||||||||||||||||
Preferred stock conversion to common stock | (4,520 | ) | (226 | ) | 36,450 | 226 | — | — | — | |||||||||||||||||||||
Stock options issued | — | — | — | — | 31 | — | — | 31 | ||||||||||||||||||||||
Translation adjustment | — | — | — | — | — | — | (1,723 | ) | (1,723 | ) | ||||||||||||||||||||
Balances, March 31, 2016 | 295,480 | $ | 14,674 | 18,359,397 | $ | 1 | $ | 90,993 | $ | (56,537 | ) | $ | (9,535 | ) | $ | 39,596 | ||||||||||||||
Net loss | — | — | — | — | — | (18,228 | ) | — | (18,228 | ) | ||||||||||||||||||||
Preferred stock dividends | — | — | — | — | — | (1,643 | ) | — | (1,643 | ) | ||||||||||||||||||||
Restricted stock issued (Note 18) | — | — | 103,301 | — | 96 | — | — | 96 | ||||||||||||||||||||||
Unrestricted stock issued (Note 18) | — | — | 161,733 | — | 143 | — | — | 143 | ||||||||||||||||||||||
Restricted stock units granted | — | — | 8,718 | — | 60 | — | — | 60 | ||||||||||||||||||||||
Stock options issued | — | — | — | — | 56 | — | — | 56 | ||||||||||||||||||||||
Translation adjustment | — | — | — | — | — | — | (820 | ) | (820 | ) | ||||||||||||||||||||
Balances, March 31, 2017 | 295,480 | $ | 14,674 | 18,633,149 | $ | 1 | $ | 91,348 | $ | (76,408 | ) | $ | (10,355 | ) | $ | 19,260 |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||
Net loss | $ | (18,228 | ) | $ | (4,232 | ) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization of drydock costs | 24,012 | 22,422 | ||||
Amortization of intangibles and deferred financing costs | 6,094 | 2,354 | ||||
Deferred income taxes | (1,459 | ) | 181 | |||
Impairment charges on retired asset | 1,872 | — | ||||
Equity compensation granted | 355 | 637 | ||||
Unrealized foreign exchange loss | 940 | 638 | ||||
Restructuring charges | 2,375 | — | ||||
Deferred drydock costs paid | (3,334 | ) | (2,001 | ) | ||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | (1,404 | ) | 67 | |||
Prepaid expenses and other current assets | 111 | (363 | ) | |||
Accounts payable and accrued liabilities | (5,795 | ) | 2,811 | |||
Other assets and liabilities, net | (311 | ) | 598 | |||
Income taxes payable, net | (34 | ) | 80 | |||
NET CASH PROVIDED BY OPERATING ACTIVITIES | 5,194 | 23,192 | ||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||
Purchase of property and equipment | (12,868 | ) | (45,165 | ) | ||
NET CASH USED IN INVESTING ACTIVITIES | (12,868 | ) | (45,165 | ) | ||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||
Deferred payment liability obligation | (564 | ) | (536 | ) | ||
Proceeds from long-term debt | 47,676 | 42,486 | ||||
Long-term debt repayment | (36,140 | ) | (22,460 | ) | ||
Debt financing cost | (2,841 | ) | (546 | ) | ||
NET CASH PROVIDED BY FINANCING ACTIVITIES | 8,131 | 18,944 | ||||
EFFECT OF FOREIGN EXCHANGE RATES ON CASH | (199 | ) | (192 | ) | ||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 258 | (3,221 | ) | |||
CASH AND CASH EQUIVALENTS, BEGINNING OF THE PERIOD | 77 | 3,298 | ||||
CASH AND CASH EQUIVALENTS, END OF THE PERIOD | $ | 335 | $ | 77 | ||
SUPPLEMENTAL CASH FLOW DISCLOSURE | ||||||
Payments for interest, net of amount capitalized | $ | 13,287 | $ | 10,654 | ||
Unpaid purchases of property and equipment | $ | 5,033 | $ | 7,131 | ||
Unpaid purchases of deferred drydock costs | $ | 3,578 | $ | 1,381 | ||
Payment of income taxes | $ | — | $ | 1 |
Customer relationships and contracts | 15 years straight-line |
Vessels | 5 - 30 years straight-line |
Leasehold improvements | 7 - 11 years straight-line |
Purchased software | 3 years straight-line |
Vehicles | 20% declining-balance |
Furniture and equipment | 20% declining-balance |
Computer equipment | 45% declining-balance |
Communication equipment | 20% declining-balance |
3. | SIGNIFICANT ACCOUNTING POLICIES (continued) |
3. | SIGNIFICANT ACCOUNTING POLICIES (continued) |
Jurisdiction | Open Tax Years (Fiscal Years) |
Federal (U.S.A) | 2014 – 2017 |
Various states | 2013 – 2017 |
Federal (Canada) | 2012 – 2017 |
Ontario | 2012 – 2017 |
4. | RECENTLY ISSUED PRONOUNCEMENTS |
March 31, 2017 | March 31, 2016 | ||||||
Prepaid insurance | $ | 302 | $ | 1,012 | |||
Fuel and lubricant inventories | 4,252 | 3,872 | |||||
Deposits and other prepaids | 1,655 | 1,436 | |||||
$ | 6,209 | $ | 6,320 |
7. | INCOME TAXES |
March 31, 2017 | March 31, 2016 | |||||
United States | $ | (14,312 | ) | $ | (5,002 | ) |
Foreign | (5,411 | ) | 1,002 | |||
$ | (19,723 | ) | $ | (4,000 | ) |
March 31, 2017 | March 31, 2016 | |||||
Current: | ||||||
Federal | $ | — | $ | — | ||
State and local | (3 | ) | 17 | |||
Foreign | (33 | ) | 34 | |||
Deferred: | ||||||
Federal | — | — | ||||
State and local | (67 | ) | (106 | ) | ||
Foreign | (1,392 | ) | 287 | |||
$ | (1,495 | ) | $ | 232 |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||
Statutory U.S. federal income tax (benefit) rate | 34.0 | % | 34.0 | % | ||
State income taxes | 0.3 | % | 2.4 | % | ||
Foreign income taxes | (2.0 | )% | 0.6 | % | ||
Imputed interest income | (1.6 | )% | (9.0 | )% | ||
Federal valuation allowance | (22.6 | )% | (27.0 | )% | ||
Foreign Permanent Items/Other | (0.5 | )% | (6.8 | )% | ||
Effective income tax rate | 7.6 | % | (5.8 | )% |
7. | INCOME TAXES (continued) |
March 31, 2017 | March 31, 2016 | ||||||
Long-term deferred tax assets | |||||||
Operating loss carry forwards | $ | 30,370 | $ | 24,586 | |||
Net deferred foreign exchange | 1,391 | 1,321 | |||||
Other | 1,087 | 958 | |||||
32,848 | $ | 26,865 | |||||
Valuation Allowance | (15,573 | ) | (10,239 | ) | |||
Net long-term deferred tax assets | 17,275 | $ | 16,626 | ||||
Long-term deferred tax liabilities | |||||||
Depreciation | (19,807 | ) | $ | (19,332 | ) | ||
Separately identifiable intangibles | (1,835 | ) | (2,991 | ) | |||
Other | — | (128 | ) | ||||
Total long-term deterred tax liabilities | (21,642 | ) | $ | (22,451 | ) | ||
Net long-term deferred tax liabilities | $ | (4,367 | ) | $ | (5,825 | ) |
7. | INCOME TAXES (continued) |
8. | PROPERTY AND EQUIPMENT, NET |
March 31, 2017 | March 31, 2016 | ||||||
Cost | |||||||
Vessels | $ | 322,820 | $ | 319,689 | |||
Leasehold improvements | 146 | 88 | |||||
Furniture and equipment | 594 | 588 | |||||
Vehicles | 15 | 16 | |||||
Computer, communication equipment and purchased software | 3,727 | 3,185 | |||||
$ | 327,302 | $ | 323,566 | ||||
Accumulated depreciation | |||||||
Vessels | $ | 110,338 | $ | 92,482 | |||
Leasehold improvements | 61 | 58 | |||||
Furniture and equipment | 408 | 351 | |||||
Vehicles | 13 | 13 | |||||
Computer, communication equipment and purchased software | 2,436 | 2,158 | |||||
$ | 113,256 | $ | 95,062 | ||||
Total Cost less Accumulated Depreciation | $ | 214,046 | $ | 228,504 |
9. | OTHER ASSETS |
March 31, 2017 | March 31, 2016 | |||||
Customer contract costs | $ | 72 | $ | 287 | ||
Prepaid expenses and other assets | 6,178 | 6,135 | ||||
Total | $ | 6,250 | $ | 6,422 | ||
Current portion (Note 6) | 6,209 | 6,320 | ||||
Other long-term assets | $ | 41 | $ | 102 |
10. | DEFERRED DRYDOCK COSTS, NET |
March 31, 2017 | March 31, 2016 | ||||||
Drydock expenditures | $ | 19,395 | $ | 17,930 | |||
Accumulated amortization | (10,593 | ) | (11,270 | ) | |||
$ | 8,802 | $ | 6,660 |
Balance as of March 31, 2015 | $ | 7,590 | |
Drydock costs accrued and incurred | 2,828 | ||
Amortization of drydock costs | (3,507 | ) | |
Foreign currency translation adjustment | (251 | ) | |
Balance as of March 31, 2016 | 6,660 | ||
Drydock costs accrued and incurred | 5,531 | ||
Amortization of drydock costs | (3,104 | ) | |
Unamortized dry-dock cost write-off for a retired vessel | (138 | ) | |
Foreign currency translation adjustment | (147 | ) | |
Balance as of March 31, 2017 | $ | 8,802 |
11. | INTANGIBLE ASSETS, NET AND GOODWILL |
March 31, 2017 | March 31, 2016 | ||||||
Intangible assets: | |||||||
Customer relationships and contracts | $ | 14,886 | $ | 15,122 | |||
Total identifiable intangibles | 14,886 | 15,122 | |||||
Accumulated amortization: | |||||||
Customer relationships and contracts | 10,059 | 9,218 | |||||
Total accumulated amortization | 10,059 | 9,218 | |||||
Net intangible assets | $ | 4,827 | $ | 5,904 | |||
Goodwill | $ | 10,193 | $ | 10,193 |
March 31, 2018 | $ | 992 | |
March 31, 2019 | 993 | ||
March 31, 2020 | 992 | ||
March 31, 2021 | 930 | ||
March 31, 2022 | 353 | ||
$ | 4,260 |
12. | VESSEL ACQUISITION |
13. | ACCRUED LIABILITIES |
March 31, 2017 | March 31, 2016 | ||||||
Deferred financing and other transaction costs | $ | — | $ | 4 | |||
Payroll compensation and benefits | 753 | 786 | |||||
Preferred stock dividends | 3,563 | 1,920 | |||||
Professional fees | 394 | 488 | |||||
Interest | 2,393 | 2,305 | |||||
Winter work, deferred drydock expenditures and capital expenditures | 5,882 | 834 | |||||
Capital and franchise taxes | 52 | 12 | |||||
Restructuring charges (Note 21) | 654 | — | |||||
Other | 1,529 | 1,795 | |||||
$ | 15,220 | $ | 8,144 |
14. | LONG-TERM DEBT |
March 31, 2017 | March 31, 2016 | |||||||
a) | Canadian Revolving Facility bearing interest at BA rate or at Borrower's option Canadian Prime rate, if funded in Canadian dollar or at BA rate or LIBOR rate, if funded in U.S. Dollar at the applicable margin as discussed below. The amount outstanding is due at contractual maturity date of September 30, 2019. | 46,996 | 43,120 | |||||
b) | U. S. Revolving Facility bearing interest at US Base Rate or at Borrower's option LIBOR at the applicable margin as discussed below. The amount outstanding is due at contractual maturity date of September 30, 2019. | 74,200 | 71,400 | |||||
$ | 121,196 | $ | 114,520 | |||||
Less unamortized debt issuance costs | (1,494 | ) | (2,094 | ) | ||||
119,702 | 112,426 | |||||||
Less amounts classified as current | 119,702 | — | ||||||
$ | — | $ | 112,426 |
14. | LONG-TERM DEBT (continued) |
• | A revolving credit facility under which Lower Lakes Towing may borrow up to US $80,000 (CDN or USD currency to be selected by Lower Lakes Towing ) with a final maturity date of September 30, 2019 (the “Canadian Revolving Facility”); |
• | A swing line facility under which Lower Lakes Towing may borrow up to the lesser of CDN $8,000 and the CDN maximum borrowing availability less the outstanding balance of the CDN revolving line at such time, with a final maturity date of September 30, 2019 (the “Canadian Swing Line Facility”); and |
• | Canadian Revolving Facility: if funded in Canadian Dollars, the BA Rate (as defined in the First Lien Credit Agreement) or, at the borrower’s option, the Canadian Prime Rate (as defined in the First Lien Credit Agreement) and if funded in U.S. Dollars, the Canadian Base Rate (as defined in the First Lien Credit Agreement) or, at the borrower’s option, the LIBOR Rate (as defined in the First Lien Credit Agreement); |
• | U.S. Revolving Facility: the US Base Rate (as defined in the First Lien Credit Agreement) or, at the borrower’s option, the LIBOR Rate; |
14. | LONG-TERM DEBT (continued) |
March 31, 2017 | March 31, 2016 | |||||||
a) | U.S. Dollar denominated term loan (Second Lien CDN Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020. | $ | 41,645 | $ | 39,826 | |||
b) | U.S. Dollar denominated term loan (Second Lien U.S. Term loan) bearing interest at LIBOR rate (as defined) plus 9.5% or U.S. base rate (as defined) plus 8.5% at the Company’s option. The loan is repayable upon maturity on March 11, 2020. | 40,049 | 38,300 | |||||
81,694 | 78,126 | |||||||
Less unamortized debt issuance costs | (1,117 | ) | (2,809 | ) | ||||
80,577 | 75,317 | |||||||
Less amounts classified as current | 80,577 | — | ||||||
$ | — | $ | 75,317 |
16. | COMMITMENTS |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||||
Operating leases | $ | 612 | $ | 560 | ||||
Operating sublease | — | 175 | ||||||
$ | 612 | $ | 735 |
March 31, 2018 | $ | 608 | |
March 31, 2019 | 547 | ||
March 31, 2020 | 457 | ||
March 31, 2021 | 242 | ||
March 31, 2022 | 111 | ||
Thereafter | 47 | ||
$ | 2,012 |
17. | CONTINGENCIES |
18. | STOCKHOLDERS’ EQUITY |
18. | STOCKHOLDERS’ EQUITY (continued) |
Date issued | No. of Officers Covered | No. of Shares | Share Price | Reference | Expense recognized during the period | ||
Vesting terms | March 31, 2017 | March 31, 2016 | |||||
Jun 5, 2013 | 6 | 54,337 | 5.55 | Restricted Share Award Agreement | 7 | 102 | |
Three years in equal installments on each anniversary date. | |||||||
Jul 22, 2014 | 10 | 105,189 | 5.90 | Restricted Share Award Agreement | 99 | 285 | |
Three years in equal installments on each anniversary date. | |||||||
Oct 27, 2015 | 1 | 4,429 | 2.19 | Restricted Share Award Agreement | 3 | 1 | |
Three years in equal installments on each anniversary date. | |||||||
Oct 27, 2015 | 1 | 10,871 | 2.19 | Restricted Share Award Agreement | 8 | 3 | |
Three years in equal installments on each of March 31. | |||||||
May 31, 2016 | 1 | 102,301 | 0.92 | Restricted Share Award Agreement | 29 | — | |
Three years in equal installments on each anniversary date. |
Stock Options: | March 31, 2017 | March 31, 2016 | ||||||||||||||||
Number of Options | Weighted Average Exercise Price per Share | Number of Options | Weighted Average Exercise Price per Share | |||||||||||||||
Outstanding - beginning of year | 363,019 | $ | 3.85 | 479,785 | $ | 5.66 | ||||||||||||
Granted | 115,000 | 1.15 | 190,000 | 2.19 | ||||||||||||||
Cancelled | (31,056 | ) | 5.81 | (155,497 | ) | 5.81 | ||||||||||||
Cancelled | (30,211 | ) | 5.50 | (151,269 | ) | 5.50 | ||||||||||||
Cancelled | (75,000 | ) | 2.19 | — | — | |||||||||||||
Expired | — | — | — | — | ||||||||||||||
Outstanding - end of year | 341,752 | $ | 2.98 | 363,019 | $ | 3.85 |
Other data (In thousands except weighted average fair value): | March 31, 2017 | March 31, 2016 | ||||||
Weighted average grant date fair value of options granted during year | $ | 0.47 | $ | 0.54 | ||||
Compensation expense | 56 | 31 | ||||||
Unrecognized compensation cost at March 31 | 54 | 71 | ||||||
Weighted average remaining life for unrecognized compensation | 10 months | 2 years, 4 months |
2017 | 2016 | ||||||
Dividend Yield | None | None | |||||
Risk Free Interest Rate | 1.24% | 0.80% | to | 1.60% | |||
Stock Price Volatility | 42.5% | 33.5% | to | 37.2% | |||
Estimated Option Term (months) | 70 | 31 | to | 72 |
19. | OUTSIDE VOYAGE CHARTER FEES |
20. | INTEREST EXPENSE |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||||
Amortization of deferred financing costs | $ | 5,093 | $ | 1,273 | ||||
Long-term debt-senior | 4,757 | 3,979 | ||||||
Long-term debt-subordinated | 9,583 | 8,266 | ||||||
Interest rate caps | — | 6 | ||||||
Deferred payment liability | 30 | 64 | ||||||
Other interest | — | 34 | ||||||
Interest capitalized | — | (1,161 | ) | |||||
$ | 19,463 | $ | 12,461 |
21. | RESTRUCTURING CHARGES |
March 31, 2017 | March 31, 2016 | |||||
Restructuring costs accrual | $ | 2,375 | $ | — | ||
Restructuring costs paid | (1,721 | ) | — | |||
Restructuring costs accrual balance | $ | 654 | $ | — |
22. | SEGMENT INFORMATION |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||||
Revenue by country: | ||||||||
Canada | $ | 67,907 | $ | 86,977 | ||||
United States | 47,544 | 61,467 | ||||||
$ | 115,451 | $ | 148,444 |
March 31, 2017 | March 31, 2016 | ||||||
Property and equipment, net by country: | |||||||
Canada | $ | 107,884 | $ | 116,719 | |||
United States | 106,162 | 111,785 | |||||
$ | 214,046 | $ | 228,504 | ||||
Intangible assets, net by country: | |||||||
Canada | $ | 2,910 | $ | 3,652 | |||
United States | 1,917 | 2,252 | |||||
$ | 4,827 | $ | 5,904 | ||||
Goodwill by country: | |||||||
Canada | $ | 8,284 | $ | 8,284 | |||
United States | 1,909 | 1,909 | |||||
$ | 10,193 | $ | 10,193 | ||||
Total assets by country: | |||||||
Canada | $ | 131,198 | $ | 141,019 | |||
United States | 117,402 | 119,485 | |||||
$ | 248,600 | $ | 260,504 |
Fair value measurements at | Fair value measurements at | |||||||||||
March 31, 2017 | March 31, 2016 | |||||||||||
Carrying value at March 31, 2017 | Quoted prices in active markets (Level 1) | Significant other observable inputs (Level 2) | Carrying value at March 31, 2016 | Quoted prices in active markets (Level 1) | Significant other observable inputs (Level 2) | |||||||
Foreign currency hedge contracts | $— | $— | $— | $(268) | $— | $(268) |
Derivatives not designated as hedging instrument: | Balance Sheet location | Fair Value as at March 31, 2017 | Fair Value as at March 31, 2016 | |||
Foreign currency hedge contracts | Accrued liabilities | $— | $(268) |
Derivatives not designated as hedging instrument: | Location of (Gain) Recognized in earnings | Twelve month period ended March 31, 2017 | Twelve month period ended March 31, 2016 | |||
Foreign currency hedge contracts | (Gain) on foreign exchange | $(3,104) | $(795) |
24. | EARNINGS (LOSS) PER SHARE ("EPS") |
Year ended March 31, 2017 | Year ended March 31, 2016 | |||||||
Numerator: | ||||||||
Net loss before preferred dividends | $ | (18,228 | ) | $ | (4,232 | ) | ||
Preferred stock dividends | (1,643 | ) | (1,333 | ) | ||||
Net loss applicable to common stockholders | $ | (19,871 | ) | $ | (5,565 | ) | ||
Denominator: | ||||||||
Weighted average common shares for basic EPS | 18,411,690 | 18,045,935 | ||||||
Effect of dilutive securities: | ||||||||
Average price during period | 0.90 | 2.31 | ||||||
Long term incentive stock option plan | 356,318 | 363,019 | ||||||
Average exercise price of stock options | 2.98 | 3.85 | ||||||
Shares that could be acquired with the proceeds of options | — | — | ||||||
Dilutive shares due to options | — | — | ||||||
Restricted Stock Units (RSU)-unvested | — | 19,467 | ||||||
Average grant date fair value of unvested RSU | — | 5.99 | ||||||
Shares that could be acquired with the proceeds of RSU | — | — | ||||||
Dilutive shares due to RSU | — | — | ||||||
Incremental shares due to unvested restricted shares | — | — | ||||||
Weighted average convertible preferred shares at $6.20 | 2,382,903 | 2,382,903 | ||||||
Weighted average common shares for diluted EPS | 18,411,690 | 18,045,935 | ||||||
Basic EPS | $ | (1.08 | ) | $ | (0.31 | ) | ||
Diluted EPS | $ | (1.08 | ) | $ | (0.31 | ) |
Name of Subsidiary | State or other jurisdiction of incorporation or organization | Names under which such subsidiaries do business |
Rand Finance Corp. | Delaware | Rand Finance Corp. |
Rand LL Holdings Corp. | Delaware | Rand LL Holdings Corp. |
Lower Lakes Towing Ltd. | Canada | Lower Lakes Towing Ltd. |
Lower Lakes Ship Repair Company Ltd. | Canada | Lower Lakes Ship Repair Company Ltd. |
Lower Lakes Transportation Company | Delaware | Lower Lakes Transportation Company |
Grand River Navigation Company, Inc. | Delaware | Grand River Navigation Company, Inc. |
Black Creek Shipping Company, Inc. | Delaware | Black Creek Shipping Company, Inc. |
Black Creek Shipping Holding Company, Inc. | Delaware | Black Creek Shipping Holding Company, Inc. |
Date: July 5, 2017 |
/s/ Edward Levy |
Edward Levy |
President and Chief Executive Officer |
(Principal Executive Officer) |
Date: July 5, 2017 |
/s/ Mark S. Hiltwein |
Mark S. Hiltwein |
Chief Financial Officer |
Principal Financial Officer |
Date: July 5, 2017 |
/s/ Edward Levy |
Edward Levy |
President and Chief Executive Officer |
(Principal Executive Officer) |
Date: July 5, 2017 |
/s/ Mark S. Hiltwein |
Mark S. Hiltwein |
Chief Financial Officer |
(Principal Financial Officer) |
Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Mar. 31, 2017 |
Jul. 05, 2017 |
Sep. 30, 2016 |
|
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Rand Logistics, Inc. | ||
Entity Central Index Key | 0001294250 | ||
Trading Symbol | rlog | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --03-31 | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 18,633,149 | ||
Document Type | 10-K | ||
Document Period End Date | Mar. 31, 2017 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2017 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 11,038,088 |
Consolidated Balance Sheets (Parentheticals) - $ / shares |
Mar. 31, 2017 |
Mar. 31, 2016 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock issued (in shares) | 295,480 | 295,480 |
Preferred stock outstanding (in shares) | 295,480 | 295,480 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock issued (in shares) | 18,633,149 | 18,359,397 |
Common stock outstanding (in shares) | 18,633,149 | 18,359,397 |
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Statement of Comprehensive Income [Abstract] | ||
Net loss before preferred dividends | $ (18,228) | $ (4,232) |
Change in foreign currency translation adjustment | (820) | (1,723) |
COMPREHENSIVE LOSS BEFORE PREFERRED STOCK DIVIDENDS | $ (19,048) | $ (5,955) |
DESCRIPTION OF BUSINESS |
12 Months Ended |
---|---|
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS | DESCRIPTION OF BUSINESS Rand Logistics, Inc. (the “Company”) is a shipping company that, through its operating subsidiaries, is engaged in the operation of bulk carriers on the Great Lakes. Rand Acquisition Corporation was incorporated in Delaware on June 2, 2004 as a blank check company whose objective was to acquire an operating business. On March 3, 2006, the Company, through its wholly-owned subsidiary, LL Acquisition Corp., acquired all of the outstanding shares of capital stock of Lower Lakes Towing Ltd. (“Lower Lakes Towing”) from the shareholders of Lower Lakes Towing, in accordance with the terms of the Stock Purchase Agreement, dated September 2, 2005, by and among the Company, LL Acquisition Corp. and the stockholders of Lower Lakes Towing, as amended. Immediately following completion of the acquisition, and in conjunction therewith, LL Acquisition Corp. and Lower Lakes Towing were amalgamated under Canadian law and the shares of capital stock of Grand River Navigation Company, Inc. (“Grand River”) and Lower Lakes Transportation Company (“Lower Lakes Transportation”) owned by Lower Lakes Towing at the time of the amalgamation were transferred to the Company's wholly-owned subsidiary, Rand LL Holdings Corp. (“Rand LL Holdings”). Upon completion of such transfer, the outstanding shares of Grand River not owned by Rand LL Holdings were redeemed in accordance with the terms of the Redemption Agreement, dated September 2, 2005, between Grand River and GR Holdings, Inc. Following completion of the foregoing transactions, as of March 3, 2006, each of Lower Lakes Towing, Grand River and Lower Lakes Transportation became indirect, wholly-owned subsidiaries of the Company. In conjunction with the foregoing transactions, as of March 3, 2006, the Company, formerly known as Rand Acquisition Corporation, changed its name to Rand Logistics, Inc. On February 4, 2011, Black Creek Shipping Company, Inc. (“Black Creek”), an indirect wholly-owned subsidiary of the Company, and Black Creek Shipping Holding Company, Inc. (“Black Creek Holdings”), a wholly-owned subsidiary of the Company and the parent corporation of Black Creek, were incorporated to acquire certain assets. On December 27, 2012, Lower Lakes Ship Repair Company Ltd. ("Lower Lakes Ship Repair"), a wholly-owned subsidiary of Lower Lakes Towing was incorporated under the laws of Canada. This subsidiary provides ship repair services exclusively for the Company. On March 11, 2014, Lower Lakes Towing (17) Ltd. ("Lower Lakes (17)"), a wholly-owned subsidiary of Lower Lakes Towing, was incorporated under the laws of Canada. Lower Lakes (17) owned the M. V. Manitoulin, a vessel placed in service in November 2015. As of November 17, 2016, Lower Lakes (17) was amalgamated with and into Lower Lakes Towing with Lower Lakes Towing continuing as the surviving entity. |
GOING CONCERN (Notes) |
12 Months Ended |
---|---|
Mar. 31, 2017 | |
GOING CONCERN [Abstract] | |
Going Concern | 2. GOING CONCERN These audited consolidated financial statements have been prepared in conformity with GAAP, which contemplates continuation of the Company as a going concern. As discussed under Notes 14, 15 and 28, the Company is currently operating under a series of short-term waivers under its credit facilities due to the Company’s inability to achieve certain financial covenants under its credit facilities and its failure to consummate a recapitalization transaction with its second lien lender, in order to avoid a further default. Further, the Company incurred a net loss of $19,871 during the year ended March 31, 2017, and as of that date, the Company’s current liabilities exceeded its current assets by $214,282 (after the reclassification of debt from long-term to current in the amount of $200,279). The balances outstanding under our credit facilities have been reclassified as short-term obligations within the Company’s Consolidated Balance Sheet at March 31, 2017 due to the Company’s expectation of not being able to satisfy certain financial covenants under such credit facilities during the ensuing twelve-month period. Together, these factors raise substantial doubt about the Company’s ability to continue as a going concern.The accompanying Report of Independent Registered Public Accounting Firm also indicates that these conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities, other than as previously discussed, or any other adjustment that might be necessary should the Company be unable to continue as a going concern. A significant factor in mitigating the substantial doubt about the Company's ability to continue as a going concern is the Company's ability to restructure or refinance its indebtedness, or complete a consensual recapitalization transaction restructure with its Second Lien Lender. Management is currently in discussions with its Second Lien Lender with respect to such a recapitalization transaction, but the terms of a potential recapitalization transaction have not yet been agreed upon, and there can be no assurance that the Company will be able to reach an agreement with respect to a recapitalization transaction in a timely manner or at all. Moreover, the terms of any such recapitalization transaction could result in a significant or complete loss of value to the holders of the Company’s common stock. If the Company is unsuccessful in restructuring or refinancing its indebtedness, or completing a consensual recapitalization transaction with its Second Lien Lender, it could result in the Company's need to voluntarily seek protection under applicable bankruptcy laws. The bankruptcy process could result in a significant or complete loss of value to the holders of our common stock. |
SIGNIFICANT ACCOUNTING POLICIES |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES Basis of presentation and consolidation The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and include the accounts of Rand Finance Corp. (“Rand Finance”), Rand LL Holdings and Black Creek Holdings , wholly-owned subsidiaries of the Company, the accounts of Lower Lakes Towing, Lower Lakes Transportation and Grand River, each of which is a wholly-owned subsidiary of Rand LL Holdings, Black Creek, which is a wholly-owned subsidiary of Black Creek Holdings, and Lower Lakes Ship Repair and Lower Lakes (17) (before its amalgamation on November 17, 2016), each of which is a wholly-owned subsidiary of Lower Lakes Towing. The consolidated financial statements include the accounts of the Company and all of its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated. Cash and cash equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Accounts receivable The majority of the Company’s accounts receivable are amounts due from customers and other accounts receivable, including insurance and Canadian harmonized sales tax refunds. The majority of accounts receivable are due within 30 to 60 days and are stated as amounts due from customers net of an allowance for doubtful accounts. The Company extends credit to its customers based upon its assessment of their creditworthiness and past payment history. Accounts outstanding longer than the contractual payment terms are considered past due. Revenue and operating expenses recognition The Company generates revenues from freight billings under contracts of affreightment (voyage charters) generally on a rate per ton basis based on origin-destination and cargo carried. Voyage revenue is recognized ratably over the duration of a voyage, which average from 2 to 3 days, based on the relative transit time in each reporting period when the following conditions are met: the Company has a signed contract of affreightment, the contract price is fixed or determinable and collection is reasonably assured. Included in freight billings are other fees such as fuel surcharges and other freight surcharges, which represent pass-through charges to customers for toll fees, lockage fees and ice breaking fees paid to other parties. Fuel surcharges are recognized ratably over the duration of the voyage, while freight surcharges are recognized when the associated costs are incurred. Freight surcharges are less than 5% of total revenue for all periods presented. Marine operating costs included in vessel operating expenses such as crewing costs, fuel, tugs and insurance are recognized as incurred or consumed and thereby are recognized ratably in each reporting period. Repairs and maintenance and certain other insignificant costs are recognized as incurred. From time to time, the Company subcontracts excess customer demand to other freight providers. Service to customers under such arrangements is transparent to the customer and no additional services are provided to customers by the Company. Consequently, revenues recognized for customers serviced by freight subcontractors are recognized on the same basis as described above. Costs for subcontracted freight providers, presented as “outside voyage charter fees” in the consolidated statements of operations, are recognized as incurred and therefore are recognized ratably over the voyage. The Company accounts for sales taxes imposed on its services on a net basis in the consolidated statements of operations. In addition, all revenues are presented on a gross basis. 3. SIGNIFICANT ACCOUNTING POLICIES Vessel acquisitions Vessel acquisitions are stated at cost, which consists of the purchase price and any material incremental expenditures incurred upon acquisition, such as initial repairs, improvements, delivery expenses and other expenditures to prepare the vessel for its initial voyage. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earnings capacity or improve the efficiency or safety of the vessels. Significant financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels' cost. Fuel and lubricant inventories Raw materials, fuel and certain operating supplies are accounted for on a first-in, first-out cost method (based on monthly averages). Raw materials and fuel are stated at the lower of actual cost (first-in, first-out method) or market and are included in prepaid expenses and other current assets in the accompanying consolidated balance sheets. Operating supplies are stated at actual cost or average cost and are recognized in expenses as they are consumed. Intangible assets and goodwill Intangible assets consist primarily of goodwill, deferred financing costs and customer relationships and contracts. Intangible assets are amortized as follows:
Deferred financing costs are amortized on a straight-line basis over the term of the related debt, which approximates the effective interest method. On adoption of ASU 2015-03 for the first quarter of the 2017 fiscal year ended March 31, 2017 (as discussed in Note 4), this cost, net of amortization is classified as an offset against our long-term debt and subordinated debt. Property and equipment Property and equipment are recorded at cost. Depreciation methods and periods for property and equipment are as follows:
3. SIGNIFICANT ACCOUNTING POLICIES (continued) Impairment of fixed assets and finite-lived intangible assets Fixed assets (e.g., property and equipment) and finite-lived intangible assets (e.g., customer relationships and contracts) are tested for impairment upon the occurrence of a triggering event that indicates the carrying value of such an asset or asset group (e.g., tugs and barges) might be no longer recoverable. Examples of such triggering events include, but are not limited to, a significant disposal of a portion of such assets, an adverse change in the market involving the business employing the related asset(s), a significant decrease in the benefits realized from an acquired business, difficulties or delays in integrating the business, and a significant change in the operations of an acquired business. Once a triggering event has occurred, the recoverability test employed is based on whether the intent is to hold the asset(s) for continued use or to hold the asset(s) for sale. If the intent is to hold the asset(s) for continued use, the recoverability test involves a comparison of undiscounted cash flows excluding interest expense but including any proceeds from eventual disposition, against the carrying value of the asset(s) as an initial test. If the carrying value of such asset(s) exceeds the undiscounted cash flow, the carrying amount of the asset(s) would be deemed to be impaired. Impairment would then be measured as the difference between the fair value of the fixed or amortizing intangible asset and the carrying value of such asset(s). The Company generally determines fair value by using the discounted cash flow method. If the intent is to hold the asset(s) for sale and certain other criteria are met (i.e., the asset(s) can be disposed of currently, appropriate levels of authority have approved the sale and there is an actively pursuing buyer), the impairment test is a comparison of the carrying value of the asset(s) to its fair value less costs to sell. To the extent that the carrying value is greater than the fair value less costs to sell, an impairment loss is recognized for the difference. As of June 30, 2016, the Company determined that its smallest carrying capacity Canadian flag bulk carrier was unlikely to generate a sufficient long term return on capitalized expenses necessary to continue operating the vessel. As a result, the Company decided to retire this vessel. The Company has also determined that the carrying value of the vessel was greater than the fair value and hence impairment charges were recorded to write off the carrying value of the vessel. At March 31, 2017, the Company completed the step 1 test of undiscounted cash flows for one specific asset group and determined that the carrying value of the asset(s) was not less than the undiscounted cash flows.
Evaluation of goodwill for impairment The Company annually (or more frequently, if required) reviews the carrying value of goodwill residing in its reporting units as of March 31, to determine whether impairment may exist. GAAP requires that goodwill and certain indefinite-lived intangible assets be assessed annually for impairment using fair value measurement techniques. Specifically, goodwill impairment is determined using a three-step process. The first step of the goodwill impairment test is to determine if the Company can perform a qualitative assessment before calculating the fair value of the reporting unit when testing goodwill for impairment. Only if the fair value of the reporting unit is determined, based on qualitative factors, to be more likely than not less than the carrying amount of the reporting unit, then entities are required to perform the next two steps of the goodwill impairment test. The second step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The estimates of fair value of the Company’s two reporting units, which are the Company’s Canadian and U.S. operations (excluding the parent), are determined using various valuation techniques with the primary techniques being a discounted cash flow analysis and peer analysis. A discounted cash flow analysis requires various judgmental assumptions, including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s forecast and long-term estimates. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the third step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the third step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The third step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the existing assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit. As of March 31, 2017, the Company conducted the quantitative assessment and determined that the fair values of its two reporting units were greater than their carrying amounts. Drydock costs Drydock costs incurred during statutory Canadian and United States certification processes are capitalized and amortized on a straight-line basis over the benefit period, which is generally sixty (60) months. Drydock costs include costs of work performed by third party shipyards and subcontractors and other direct expenses to complete the mandatory certification processes. Repairs and maintenance The Company’s vessels require repairs and maintenance each year to ensure the fleet is operating efficiently during the shipping season. The majority of repairs and maintenance are conducted in January, February, and March of each year when the vessels are not engaged in affreightment activities. The Company expenses such routine repairs and maintenance costs as incurred. Significant repairs to the Company’s vessels, such as major engine overhauls and major hull steel repairs, are capitalized and amortized over the lesser of the remaining useful life of the upgrade or the asset repaired.
Income taxes The Company accounts for income taxes in accordance with Accounting Standards Codification ("ASC") 740 “Income Taxes,” which requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax bases of tax assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is recognized, if necessary, to measure tax benefits to the extent that, based on available evidence, it is more likely than not that they will be realized. Income tax expense (or benefit) for an interim period is based on income taxes computed for ordinary income or loss and income taxes computed for items or events that are not part of ordinary income or loss. At the end of each interim period, the Company applies an estimate of the effective tax rate expected to be applicable for the full fiscal year to the year-to-date ordinary income (or loss) at the end of the interim period. The Company classifies interest expense related to income tax liabilities, when applicable, as part of the interest expense in its consolidated statements of operations rather than income tax expense. To date, the Company has not incurred material interest expenses or penalties relating to assessed taxation amounts. Lower Lakes Towing is currently under examination by the Canadian taxing authority for the tax years 2014 and 2015. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin, New Jersey and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:
Foreign currency translation The Company uses the U.S. Dollar as its reporting currency. The functional currency of the Company's Canadian subsidiaries is the Canadian Dollar. The functional currency of the Company’s U.S. subsidiaries is the U.S. Dollar. Assets and liabilities denominated in foreign currencies are translated into U.S. Dollars at the rate of exchange at the balance sheet date, while revenue and expenses are translated at the average exchange rates prevailing during the respective month. Components of stockholders’ equity are translated at historical exchange rates. Exchange gains and losses resulting from translation are reflected in accumulated other comprehensive income or loss, except for financial assets and liabilities designated in foreign currency, which are reflected in the Company's consolidated statements of operations. Advertising costs The Company expenses all advertising costs as incurred. These costs are included in general and administrative expenses and were insignificant during the periods presented. 3. SIGNIFICANT ACCOUNTING POLICIES (continued) Use of estimates The preparation of consolidated financial statements in conformity with 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions used in the preparation of these consolidated financial statements include the assumptions used in the determination of whether there is substantial doubt about the Company's ability to continue as a going concern, the assumptions used in determining the useful lives of long-lived assets, the assumptions used in determining whether assets are impaired, the assumptions used in determining the valuation allowance for deferred income tax assets and the assumptions used in stock-based compensation awards. Actual results could differ from those estimates. Stock-based compensation The Company recognizes compensation expense for all newly granted awards and awards modified, repurchased or cancelled based on fair value at the date of grant or the date of modification, if applicable. Financial instruments The Company accounts for its foreign currency hedge contracts on its subordinated debt utilizing ASC 815 “Derivatives and Hedging” ("ASC 815"). All changes in the fair value of any foreign currency hedge contracts are recorded in earnings and the fair value of settlement costs to terminate any foreign currency hedge contracts are included in current assets or current liabilities on the consolidated balance sheets. Fair value of financial instruments ASC 820 “Fair Value Measurements and Disclosures” ("ASC 820") defines fair value, establishes a framework for measuring fair value in GAAP and establishes a hierarchy that categorizes and prioritizes the inputs to be used to estimate fair value. The three levels of inputs used are as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The disclosure requirements of ASC 815 and 820 related to the Company’s financial assets and liabilities are presented in Note 23. |
RECENTLY ISSUED PRONOUNCEMENTS |
12 Months Ended |
---|---|
Mar. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
RECENTLY ISSUED PRONOUNCEMENTS | RECENTLY ISSUED PRONOUNCEMENTS Revenue from Contracts with Customers In May 2014, the Financial Accounting Standard Board (the "FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 would have been effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. In July 2015, the FASB voted to delay the effective date of the new standard by one year to annual periods beginning after December 15, 2017. ASU 2014-09, as subsequently amended, shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. Early adoption is permitted as of the original effective date. In May 2016, the FASB issued ASU 2016-11, Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting ("ASU 2016-11"). ASU 2016-11 rescinds several SEC Staff Announcements that are codified in Topic 605, including, among other items, guidance relating to accounting for shipping and handling fees and freight services. In addition, in March 2016, the FASB issued ASU No. 2016-08 Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (“ASU 2016-08”), which clarifies the principal-versus-agent guidance in Topic 606 and requires an entity to determine whether the nature of its promise to provide goods or services to a customer is performed in a principal or agent capacity and to recognize revenue in a gross or net manner based on its principal/agent designation. In April 2016, the FASB also issued ASU No. 2016-10 Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing (“ASU 2016-10”), which amends the revenue guidance on identifying performance obligations and accounting for licenses of intellectual property. In May 2016, the FASB also issued ASU No. 2016-12 Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients (“ASU 2016-12”), which amends the revenue guidance to clarify measurement and presentation, as well as to include some practical expedients and policy elections. In December 2016, the FASB issued ASU 2016-20, “Technical Corrections and Improvements to Topic 606, Revenue From Contracts with Customers”. The update makes minor changes to ASU 2014-09. The technical corrections affect narrow aspects of the new revenue standard, including: loan guarantee fees, contract costs-impairment testing, contract costs - interaction of impairment testing with guidance in other topics, provisions for losses on construction-type and production-type contracts, scope of the new revenue standard, disclosure of remaining performance obligations, disclosure of prior-period performance obligations, a contract modification example, refund liability, advertising costs, fixed-odds wagering contracts in the casino industry, and cost capitalization for advisers to private and public funds.There are two transition methods available under the new standard, either cumulative effect or retrospective. ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 must be adopted concurrently with the adoption of ASU 2014-09. The Company is evaluating the effect, if any, that adopting these new accounting standards will have on the Company's consolidated financial statements and related disclosures. Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern In August 2014, the FASB issued Accounting Standards Update 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). ASU 2014-15 provides guidance on management's responsibility in evaluating whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). ASU 2014-15 also provides guidance related to the required disclosures as a result of management's evaluation. The amendments in ASU 2014-15 are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company adopted ASU 2014-15 for the year ended March 31, 2017. The required disclosures are presented in Note 3. 4. RECENTLY ISSUED PRONOUNCEMENTS (continued) Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. In April 2015, the FASB issued ASU 2015-03, Imputation of Interest - Simplifying the Presentation of Debt Issuance Costs ("ASU 2015-03"). This guidance requires that the debt issuance costs related to a recognized term debt liability be presented in the balance sheet as a direct deduction from the debt liability, consistent with the presentation of a debt discount. This amendment is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. The Company adopted the provisions of ASU 2015-03 for the first quarter of the 2017 fiscal year and has applied these provisions retrospectively to the prior period presented. As a result of the adoption of this pronouncement, our unamortized deferred financing costs at March 31, 2016 of $4,903 were reclassified from intangible assets to an offset against our long-term debt and subordinated debt. The effect of the adoption did not result in a change to equity or net income (See Notes 11, 14 and 15). Leases (Topic 842) In February 2016, the FASB issued ASU 2016-02, Leases ("ASU 2016-02"). ASU 2016-02 revises the existing guidance related to leases by requiring lessees to recognize a lease liability and a right-of-use asset for all leases, as well as additional disclosure regarding leasing arrangements. This standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and requires a modified retrospective adoption, with earlier adoption permitted. The Company is currently evaluating the effects of the adoption of ASU 2016-02 on its consolidated financial statements. Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). ASU 2016-09 simplifies certain aspects of the accounting for share-based payment transactions, including tax consequences, classification of awards, the option to recognize stock compensation expense with actual forfeitures as they occur, and the classifications on the statement of cash flows. ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within each reporting period, with early adoption permitted. The Company is currently evaluating the effects of the adoption of ASU 2016-09 on its consolidated financial statements. Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The pronouncement provides clarification guidance on certain cash flow presentation issues such as debt prepayment or debt extinguishment costs and contingent consideration payments made after a business combination. This pronouncement is effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the impact that this standard will have on its Consolidated Statements of Cash Flows. Income Taxes (Topic 740) - Intra-Entity Transfers of Assets Other Than Inventory In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740) - Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16"). ASU 2016-16 provides guidance on recognition of current income tax consequences for intra-entity asset transfers (other than inventory) at the time of transfer. This represents a change from current GAAP, where the consolidated tax consequences of intra-entity asset transfers are deferred from the time of transfer to a future period. The guidance is effective for annual reporting periods beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption at the beginning of an annual period is permitted. The Company is currently assessing the potential impact that ASU 2016-16 will have on the financial statements and disclosures. 4. RECENTLY ISSUED PRONOUNCEMENTS (continued) Statement of Cash Flows (Topic 230): Restricted Cash In November 2016, the FASB issued ASU No. 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash", which requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of- period and end-of-period total amounts shown on the statement of cash flows. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company does not expect these amendments to have a material effect on its financial statements. Business Combinations (Topic 805) In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business” (“ASU 2017-01”), which adds guidance to assist companies evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or of businesses, and provides for a screen to determine when a transaction should be accounted for as the acquisition or disposal of assets and not of a business, potentially reducing the number of transactions that need to be further evaluated. ASU 2017-01 is effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. No disclosures are required at transition and early adoption is permitted. The Company is currently evaluating the impact of adopting the new guidance on its consolidated financial statements. Intangibles - Goodwill and Other (Topic 350) In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) ("ASU 2017-04"), which simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates on or after January 1, 2017. The Company is currently evaluating the impact of adopting ASU 2017-04 on its consolidated financial statements. Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets On February 22, 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-05, “Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets”, to clarify the scope of asset derecognition guidance and provide new guidance on the accounting for partial sales of nonfinancial assets. This guidance provides greater detail on what types of transactions should be accounted for within the scope of FASB Accounting Standards Codification (“ASC”) subtopic 610-20. The effective date for this update for public entities is for annual reporting periods beginning after December 15, 2017. The Company is evaluating the impact of the adoption of this ASU on its consolidated financial statements. 4. RECENTLY ISSUED PRONOUNCEMENTS (continued) Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. In May 2017, the FASB issued ASU No. 2017-09 “Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting”. ASU No. 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. ASU No. 2017-09 is effective for annual periods beginning after December 15, 2017 and interim periods within those years. The amendments in ASU No. 2017-09 are to be applied prospectively to an award modified on or after the adoption date, consequently the impact will be dependent on whether the Company modifies any of its share-based payment awards and the nature of such modifications. |
ACCOUNTS RECEIVABLE, NET |
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Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |
ACCOUNTS RECEIVABLE, NET | ade receivables are presented net of an allowance for doubtful accounts. The allowance was $113 as of March 31, 2017 and $116 as of March 31, 2016. The Company manages and evaluates the collectability of its trade receivables as follows: management reviews aged accounts receivable listings and contact is made with customers that have extended beyond agreed upon credit terms. Senior management and operations are notified so that when they are contacted by such customers for a future delivery, they can request that the customer pays any past due amounts before any future cargo is booked for shipment. Customer credit risk is also managed by reviewing the history of payments by the customer, the size and credit quality of the customer, the period of time remaining within the shipping season and demand for future cargos. |
PREPAID EXPENSES AND OTHER CURRENT ASSETS |
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Prepaid Expense and Other Assets, Current [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PREPAID EXPENSES AND OTHER CURRENT ASSETS | PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets are comprised of the following:
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INCOME TAXES |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INCOME TAXES | INCOME TAXES Loss before income taxes was derived from the following sources:
The components of the provision (benefit) for income taxes are as follows:
The total provision (benefit) for income taxes differs from that amount which would be computed by applying the U.S. Federal and Canadian income tax rates to income (loss) before provision for income taxes as follows:
The primary reason the effective income tax rate for fiscal year 2017 is higher than the effective income tax benefit for fiscal year 2016 is due to the changes in the Federal U.S. and foreign valuation allowances, imputed interest income and other foreign permanent items. In November 2015, the FASB issued Accounting Standards Update 2015-17 that requires deferred tax assets and liabilities to be classified as non-current in the balance sheet. The guidance is effective for annual periods, and for interim periods within those annual periods, beginning after December 15, 2016, with early adoption permitted. The Company elected to early adopt the guidance during the fourth quarter of the year ended March 31, 2016. All deferred assets and liabilities have been classified as non-current beginning for the period ending March 31, 2016, and forward.
The significant components of long-term deferred tax assets and liabilities are as follows:
The Company has net long-term deferred tax liabilities of $173 ($241 as of March 31, 2016) in the U.S. federal and state jurisdictions and net long-term deferred tax liabilities of $4,194 ($5,584 as of March 31, 2016) in Canadian jurisdictions. The Company establishes a valuation allowance when it is more likely than not that it will not be able to realize the benefit of the deferred tax assets, or when future deductibility is uncertain. Periodically, the valuation allowance is reviewed and adjusted based on management’s assessment of realizable deferred tax assets. The Company determined at March 31, 2014 that its U.S. federal net deferred tax assets, including net operating loss carry-forwards, would not fully be utilized due to a cumulative break-even position over the prior three fiscal years, coupled with anticipated cumulative three year losses in the near future. As such, the Company recorded a full valuation allowance against the net U.S. Federal deferred tax assets. The Company's position remains unchanged at March 31, 2017 as it relates to the U.S. federal net deferred tax assets, thus a full valuation allowance against the net U.S. Federal, net deferred tax assets continues in existence, resulting in an increase of the valuation allowance by $4,456 during the year ended March 31, 2017 and $1,100 during the year ended March 31, 2016. The Company determined at March 31, 2015 that the Canadian deferred income tax asset relating to non-capital losses on Lower Lakes Towing would be realized based on performance of the entity and the expected timing of the reversal of the deferred tax liabilities. The Company determined that the deferred income tax assets relating to capital losses and unrealized foreign exchange losses in Lower Lakes Towing would not be realized. As such, a full valuation allowance was recorded against capital losses and unrealized foreign exchange losses in Lower Lakes Towing. The Company also determined that the Canadian deferred income tax assets on Lower Lakes Ship Repair would not be realized based on the uncertainty of future income. As such, a full valuation allowance was recorded against Lower Lakes Ship Repair's deferred tax assets. The Company's position remains unchanged at March 31, 2017 as it relates to the Canadian net deferred tax assets.
For state tax purposes, the Company is in a net deferred tax liability position of $173 at March 31, 2017, and in a net deferred tax liability position of $241 at March 31, 2016. The net deferred tax positions include valuation allowances of $882 and $339 at March 31, 2017 and March 31, 2016, respectively. In determining the valuation allowance, the Company considered the reversing patterns of tax liabilities on a separate jurisdiction basis and it is expected that a portion of these liabilities will reverse within the period of time available to offset existing deferred tax assets including net operating loss carry-forwards. The Company recorded an increase in the state valuation allowance of $543 during the year ended March 31, 2017. At March 31, 2017, the Company had unused U.S. federal net operating loss carry-forwards totaling $70,833 that expire between fiscal 2020 and 2037, of which a small portion is subject to Internal Revenue Code section 382 annual limitations. At March 31, 2017, the Company also had unused Canadian net operating loss carry-forwards totaling CDN $21,640 that expire between fiscal 2027 and 2037. |
PROPERTY AND EQUIPMENT, NET |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT, NET Property and equipment, net are comprised of the following:
Property and equipment as of March 31, 2017 includes capitalized interest additions during the twelve month period ended March 31, 2017 of $Nil ($1,161 for the fiscal year ended March 31, 2016). As of June 30, 2016, the Company determined that its smallest carrying capacity Canadian flag bulk carrier was unlikely to generate a sufficient long-term return on capitalized expenses necessary to continue operating the vessel. As a result, the Company decided to retire this vessel as of June 30, 2016. The Company has also determined that the carrying value of the vessel is greater than the fair value and hence impairment charges of $1,872 including write-off of unamortized drydock costs were recorded during the three month period ended June 30, 2016. The vessel did not sail during the twelve month period ended March 31, 2017. The operating loss of the vessel, included in the Consolidated Statement of Operations for the twelve month period ended March 31, 2017 was $293 versus operating income of $475 for the twelve month period ended March 31, 2016. |
OTHER ASSETS |
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OTHER ASSETS | OTHER ASSETS Other assets classified as non-current include certain customer contract related expenditures, which are amortized over a five-year period. The current portion of such costs represents the amounts expected to be recognized as expenses during the next fiscal year.
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DEFERRED DRYDOCK COSTS, NET |
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Deferred Drydock Costs [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEFERRED DRYDOCK COSTS, NET | DEFERRED DRYDOCK COSTS, NET Deferred drydock costs, net are comprised of the following:
The following table shows periodic deferrals of drydock costs and amortization.
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INTANGIBLE ASSETS, NET AND GOODWILL |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INTANGIBLE ASSETS, NET AND GOODWILL | INTANGIBLE ASSETS, NET AND GOODWILL Intangibles, net are comprised of the following:
As a result of the adoption of ASU 2015-03 "Imputation of Interest - Simplifying the Presentation of Debt Issuance Costs" (as discussed in Note 4), unamortized deferred financing costs at March 31, 2016 were reclassified from intangible assets to an offset against long-term debt and subordinated debt. Intangible asset amortization over the next five years is estimated as follows: Twelve month period ending:
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VESSEL ACQUISITION |
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Mar. 31, 2017 | |
Vessel Acquisitions [Abstract] | |
VESSEL ACQUISITION | VESSEL ACQUISITION On March 11, 2014, Lower Lakes Towing entered into and consummated the transactions contemplated by a Memorandum of Agreement with Uni-Tankers M/T “Lalandia Swan” ApS, pursuant to which Lower Lakes Towing purchased the Lalandia Swan for a purchase price of $7,000. Lower Lakes Towing subsequently transferred the title of such vessel to Lower Lakes (17). This acquisition was funded with borrowings under the subordinated debt described in Note 15. The vessel was converted to a self-unloading vessel. The Lalandia Swan was renamed the M.V. Manitoulin. The vessel was placed into service in November 2015. Lower Lakes (17) was amalgamated with and into Lower Lakes Towing on November 7, 2016 with Lower Lakes Towing continuing as the surviving entity. |
ACCRUED LIABILITIES |
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ACCRUED LIABILITIES | ACCRUED LIABILITIES Accrued liabilities are comprised of the following:
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LONG-TERM DEBT |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LONG-TERM DEBT | LONG-TERM DEBT
As a result of the covenant violations and other matters described below, the Company has classified the entire balance of this debt as a current liability at March 31, 2017. The effective interest rates at March 31, 2017 were 3.70% (3.60% at March 31, 2016) on the Canadian Revolving Facility (defined below) and 3.81% (3.37% at March 31, 2016) on the U.S. Revolving Facility (defined below). On March 27, 2015, the Company and certain of its subsidiaries entered into a credit agreement (as amended from time to time, the “First Lien Credit Agreement”) with Bank of America, N.A., in its capacity as agent and lender, and certain other lenders party thereto. Lower Lakes Towing, Lower Lakes Transportation, Grand River, and Black Creek are borrowers (the “Borrowers”) under the First Lien Credit Agreement. Black Creek, Lower Lakes Transportation, Grand River, Black Creek Holdings, Rand LL Holdings and Rand Finance, each of which is a direct or indirect wholly-owned subsidiary of the Company and the Company itself are guarantors of all United States and Canadian obligations under the First Lien Credit Agreement (collectively, the “U.S. Guarantors”). Lower Lakes Ship Repair is a guarantor of all Canadian obligations under the First Lien Credit Agreement and is an indirect wholly-owned subsidiary of the Company (the “Canadian Guarantor”; and together with the U.S. Guarantors, the “Guarantors”). The proceeds of the First Lien Credit Agreement were used to extinguish certain then-existing indebtedness and to provide working capital financing and funds for other general corporate and permitted purposes. The obligations are secured by first-priority liens on, and a first-priority security interest in, substantially all of the assets of the Borrowers and the Guarantors party to the agreement, including a pledge of all or a portion of the equity interests of the Borrowers and the Guarantors. The security interests are evidenced by pledge, security and guaranty agreements and other related agreements, including certain fleet mortgages.
The credit facilities (the “Credit Facilities”) under the First Lien Credit Agreement consist of:
•A revolving credit facility under which Lower Lakes Transportation, Grand River and Black Creek may borrow up to USD $90,000 with a final maturity date of September 30, 2019 (the “U.S. Revolving Facility,” and collectively with the Canadian Revolving Facility, the "Revolving Facilities");
•A swing line facility under which Lower Lakes Transportation, Grand River and Black Creek may borrow the lesser of up to USD $9,000 and the maximum borrowing availability less the outstanding balance of the U.S. Revolving Facility at such time, with a final maturity date of September 30, 2019 (the “U.S. Swing Line Facility”). Borrowings under the Credit Facilities will bear interest, in each case plus an applicable margin, as follows:
•Canadian Swing Line Facility: the Canadian Prime Rate or, at the borrower’s option, the Canadian Base Rate; and •U.S. Swing Line Facility: the US Base Rate. The applicable margin to the BA Rate, Canadian Prime Rate, Canadian Base Rate, US Base Rate and the LIBOR Rate is subject to specified changes depending on the Senior Funded Debt to EBITDA Ratio (as defined in the First Lien Credit Agreement). The Borrowers will also pay a monthly commitment fee at an annual rate of 0.25% on the undrawn committed amount available under the Revolving Facilities, which rate shall increase to 0.375% in the event the undrawn committed amount is greater than or equal to 50% of the aggregate committed amount under the Revolving Facilities. Any amounts outstanding under the Credit Facilities are due at maturity. In addition, subject to certain exceptions, the Borrowers will be required to make principal repayments on amounts outstanding under the Credit Facilities from the net proceeds of specified types of asset sales, debt issuances and equity offerings. No such transactions have occurred as of March 31, 2017. The First Lien Credit Agreement contains certain negative covenants, including those limiting the Guarantors’, the Borrowers’, and their subsidiaries’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the First Lien Credit Agreement requires the Borrowers to maintain certain financial ratios. On February 9, 2016, the parties to the First Lien Credit Agreement executed an Amendment No. 1 and Waiver Agreement pursuant to which the lenders under the First Lien Credit Agreement (i) waived breach of the Minimum Fixed Charge Coverage Ratio and Maximum Senior Funded Debt to EBITDA Ratio covenants contained in the First Lien Credit Agreement which existed as of December 31, 2015; and (ii) added a temporary minimum EBITDA covenant for the period from April 1, 2016 through May 31, 2016. On August 26, 2016, the parties to the First Lien Credit Agreement entered into an Amendment No. 2 and Waiver Agreement ("Amendment No. 2") pursuant to which the lenders under the First Lien Credit Agreement waived the breach of certain financial and other covenants by the Company, including breach of the Maximum Senior Funded Debt to EBITDA Ratio covenant therein, calculated as of June 30, 2016. Amendment No. 2 also modified the Maximum Fixed Charge Coverage Ratio and the Maximum Senior Funded Debt to EBITDA Ratio covenants, further limited the expectations to the Restricted Payments (as defined in the First Lien Credit Agreement) allowed to be made by the Company, provided for additional fees, and incorporated new restrictions on certain Company
activities. On September 13, 2016, the parties to the First Lien Credit Agreement entered into Amendment No. 3 to Credit Agreement pursuant to which immaterial changes were made to certain definitions. On June 1, 2017, the parties to the First Lien Credit Agreement entered in to an Amendment No. 4 and Waiver to Credit Agreement (“Amendment No. 4”), pursuant to which the lenders under the First Lien Credit Agreement waived, during the First Lien Waiver Period (as defined below), the Company’s failure to deliver its audited financial statements for the fiscal year ending March 31, 2017 by May 31, 2017 (the “Specified Default”). Under Amendment No. 4, the First Lien Waiver Period ends on the earliest to occur of (i) any Event of Default (other than the Specified Default) under the First Lien Credit Agreement or the Second Lien Credit Agreement (as defined below), (ii) the commencement of any legal proceeding by any of the Credit Parties which would enjoin the First Lien Agent or lenders from enforcing their rights under the First Lien Wavier, (iii) three (3) business days following the termination of negotiations among the Credit Parties and the Second Lien Lender (as defined below) of a potential recapitalization transaction involving the Company and (iv) June 14, 2017. Amendment No. 4, among other things, further provides for (i) enhanced or new restrictions on certain Company activities not in the ordinary course of business, including with respect to consummating a merger or sale, making certain intercompany payments, or incurring new liens or indebtedness (other than under the First Lien Credit Agreement), (ii) continuation of certain rights of the First Lien Agent applicable during an Event of Default during the First Lien Waiver Period (notwithstanding waiver of the Specified Default), including with respect to (a) reimbursement of fees and expenses, (b) entitlement to default interest and (c) enhanced entitlement to Company access and reporting, and (iii) restrictions on the Company's right to designate a LIBOR based interest rate for new loans under the First Lien Credit Agreement. Finally, Amendment No. 4 provides for an Event of Default under the First Lien Credit Agreement if the Company shall not have agreed to a recapitalization transaction with the Second Lien Lender by June 30, 2017, on terms reasonably satisfactory to the First Lien Agent. As of June 14, 2017, the parties to the Second Lien Credit Agreement entered into a First Amendment to Amendment No. 4 pursuant to which the waiver provided in the Fifth Amendment was extended to June 30, 2017, subject to the other terms and conditions of Amendment No. 4. As discussed in Note 28 - Subsequent Events, effective as of June 30, 2017, the Company and the lenders entered into a Second Amendment to Amendment No. 4 pursuant to which the waiver period under the First Amendment to Amendment No. 4 was extended and certain covenant breaches were waived by the lenders. As of March 31, 2017, the Company had credit availability of USD $48,373 under the Credit Facilities based on eligible receivables and vessel collateral value, the aggregate principal amount outstanding under the First Lien Credit Agreement was $119.7 million, and Rand was in compliance with the covenants, as amended, as set forth in the First Lien Credit Agreement. Except as set forth in the Second Amendment to Amendment No. 4, as of the date of this filing, Rand was in compliance with the covenants set forth in the First Lien Credit Agreement. |
SUBORDINATED DEBT |
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Mar. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SUBORDINATED DEBT | SUBORDINATED DEBT
As a result of the covenant violations and other matters described below, the Company has classified the entire balance of this debt as a current liability at March 31, 2017. The effective interest rates at March 31, 2017 were 13.75% (10.75% at March 31, 2016) on each of the Second Lien CDN Term Loan (defined below) and the Second Lien U.S. Term Loan (defined below). This increase is attributable to 3% pay-in-kind ("PIK") interest for the six month period ended March 31, 2017, related to the Fourth Amendment and Waiver To Term Loan Credit Agreement as discussed below. On March 11, 2014, Lower Lakes Towing, Grand River and Black Creek, as borrowers, Rand LL Holdings, Rand Finance, Black Creek Holdings and the Company, as guarantors, Guggenheim Corporate Funding, LLC, as agent and Lender, and certain other lenders, entered into a Term Loan Credit Agreement (as amended from time to time, the “Second Lien Credit Agreement”). The Second Lien Credit Agreement initially provided for (i) a U.S. Dollar denominated term loan facility under which Lower Lakes Towing was obligated to the lenders in the amount of $34,200 (the “Second Lien CDN Term Loan”), (ii) a U.S. dollar denominated term loan facility under which Grand River and Black Creek were obligated to the Lenders in the amount of $38,300 (the “Second Lien U.S. Term Loan”) and (iii) an uncommitted incremental term loan facility of up to $32,500. The outstanding principal amount of the Second Lien CDN Term Loan borrowings and the Second Lien U.S. Term Loan borrowings will be repayable upon their maturity on March 11, 2020. The Second Lien CDN Term Loan and Second Lien U.S. Term Loan bear an interest rate per annum at borrowers’ option, equal to (i) LIBOR (as defined in the Amended Second Lien Credit Agreement) plus 9.50% per annum, or (ii) the U.S. Base Rate (as defined in the Amended Second Lien Credit Agreement), plus 8.50% per annum. Obligations under the Second Lien Credit Agreement are secured by the second-priority liens and security interests in substantially all of the assets of the borrowers and the guarantors, including a pledge of all or a portion of the equity interests of the borrowers and the guarantors. The indebtedness of each domestic borrower under the Second Lien Credit Agreement is unconditionally guaranteed by each other domestic borrower and by the guarantors which are domestic subsidiaries, and such guaranty is secured by a lien on substantially all of the assets of each borrower and each guarantor. Each domestic borrower also guarantees the obligations of the Canadian borrower and each Canadian guarantor guarantees the obligations of the Canadian borrower. Under the Second Lien Credit Agreement and subject to the terms of the Intercreditor Agreement (as defined below), the borrowers will be required to make mandatory prepayments of principal on term loan borrowings (i) in the event of certain dispositions of assets and insurance proceeds (all subject to certain exceptions), in an amount equal to 100% of the net proceeds received by the borrowers therefrom, and (ii) in an amount equal to 100% of the net proceeds to a borrower from any issuance of a borrower’s debt or equity securities (all subject to certain exceptions). 15. SUBORDINATED DEBT (continued) The Second Lien Credit Agreement contains certain covenants, including those limiting the guarantors, the borrowers, and their subsidiaries’ ability to incur indebtedness, incur liens, sell or acquire assets or businesses, change the nature of their businesses, engage in transactions with related parties, make certain investments or pay dividends. In addition, the Second Lien Credit Agreement requires the borrowers to maintain certain financial ratios. Failure of the borrowers or the guarantors to comply with any of these covenants or financial ratios could result in the outstanding principal amounts of the loans under the Second Lien Credit Agreement being accelerated. The obligations of the borrowers and the liens of the lenders under the Second Lien Credit Agreement are subject to the terms of an Intercreditor Agreement, which is further described below under the heading “Intercreditor Agreement”. On April 11, 2014, the parties under the Second Lien Credit Agreement entered into a First Amendment to the Second Lien Credit Agreement, which extended the due date of certain post-closing deliverables. On March 27, 2015, the parties to the Second Lien Credit Agreement entered into a Second Amendment (the “Second Amendment”) to the Second Lien Credit Agreement. The Second Amendment conformed certain provisions of the Amended Second Lien Credit Agreement to the First Lien Credit Agreement, reduced the uncommitted incremental facility to $22,500, and also amended certain other covenants and terms thereof. On February 9, 2016, the parties to the Amended Second Lien Credit Agreement executed a Third Amendment and Waiver Under Term Loan Credit Agreement pursuant to which the lenders under the Second Lien Credit Agreement (i) waived breach of the Minimum Fixed Charge Coverage Ratio, the Maximum Senior Funded Debt to EBITDA Ratio, and the Maximum Total Funded Debt to EBITDA Ratio covenants contained in the Amended Second Lien Credit Agreement which existed as of December 31, 2015; and (ii) added a temporary minimum EBITDA covenant for the period from April 1, 2016 through May 31, 2016. On August 26, 2016, the parties to the Second Lien Credit Agreement entered into a Fourth Amendment and Waiver To Term Loan Credit Agreement (the "Fourth Amendment") pursuant to which the lenders under the Second Lien Credit Agreement waived the breach of certain financial and other covenants by the Company, including the Maximum Senior Funded Debt to EBITDA Ratio and the Maximum Total Funded Debt to EBITDA Ratio covenants therein, in each case calculated as of June 30, 2016. The Fourth Amendment also modified the Minimum Fixed Charge Coverage Ratio, the Maximum Senior Funded Debt to EBITDA Ratio and the Maximum Total Funded Debt to EBITDA Ratio covenants, further limits the exceptions to the Restricted Payments (as defined in the Second Lien Credit Agreement) allowed to be made by the Company, incorporated new restrictions on certain Company activities, provided for (1) additional fees, (2) additional pay-in-kind interest under certain circumstances, and (3) certain additional Events of Default (as defined in the Second Lien Credit Agreement), including the non-payment of certain current and potential future fees that will only become due and payable if certain milestones are not met related to the Company's progress towards a refinancing of the Second Lien Credit Agreement. On June 1, 2017, the parties under the Second Lien Credit Agreements entered in to a Fifth Amendment and Waiver to Credit Agreement (the “Fifth Amendment”), pursuant to which the Second Lien Lender waived, during the Second Lien Waiver Period (as defined below), the Company’s failure to deliver its audited financial statements for the fiscal year ending March 31, 2017 by May 31, 2017 (the “Specified Default”). Under the Fifth Amendment, Second Lien Waiver Period ends on the earliest to occur of (i) any Event of Default (other than the Specified Default) under the First Lien Credit Agreement or the Second Lien Credit Agreement, (ii) the commencement of any legal proceeding by any of the Credit Parties which would enjoin the Second Lien Lender from enforcing its rights under the Second Lien Wavier, (iii) three (3) business days following the termination of negotiations among the Credit Parties and the Second Lien Lender of a potential recapitalization transaction involving the Company, the terms of which have not yet been proposed by the Company or the Second Lien Lender and (iv) June 14, 2017. The Fifth Amendment, among other things, further provides for (i) enhanced or new restrictions on certain Company activities not in the ordinary course of business, including with respect to consummating a merger or sale, making certain intercompany payments, or incurring new liens or indebtedness (other than under the First Lien Credit Agreement), (ii) extension of certain rights of the Agent applicable during an Event of Default during the Second Lien Waiver Period to the Second Lien Lender and continuation of certain of such rights during the Second Lien Waiver Period (notwithstanding waiver of the Specified Default), including with respect to (a) reimbursement of fees and expenses, (b) entitlement to default interest and (c) enhanced entitlement to Company access and reporting, and (iii) restrictions on the Company's right to designate a LIBOR based interest rate for new loans under the Second Lien Credit Agreement. Finally, the Fifth Amendment provides for an Event of Default under the Second Lien Credit Agreement if the Company shall not have agreed to a recapitalization transaction with the Second Lien Lender by June 30, 2017. 15. SUBORDINATED DEBT (continued) As of June 14, 2017, the parties to the Second Lien Credit Agreement entered into a First Amendment to Fifth Amendment pursuant to which the waiver provided in the Fifth Amendment was extended to June 30, 2017, subject to the other terms and conditions of the Fifth Amendment. As discussed in Note 28 - Subsequent Events, effective as of June 30, 2017, the Company and the lenders entered into a Second Amendment to the Fifth Amendment pursuant to which the waiver period under the First Amendment to Fifth Amendment was extended and certain covenant breaches were waived by the lenders. As of March 31, 2017, the aggregate principal outstanding under the Second Lien Credit Agreement was $80.6 million. Except as set forth in the Second Amendment to Fifth Amendment, as of the date of this filing, Rand was in compliance with the covenants, as amended, set forth in the Second Lien Credit Agreement. Intercreditor Agreement In connection with the First Lien Credit Agreement and the Second Lien Credit Agreement described above, on March 27, 2015, the Company and certain of its subsidiaries (collectively, the “Credit Parties”) entered into an Intercreditor Agreement (the “Intercreditor Agreement”) with Bank of America, N.A., as agent for the lenders under the First Lien Credit Agreement (the “First Lien Lenders”) and Guggenheim Corporate Funding, LLC, as agent for the lender under the Second Lien Credit Agreement (the “Second Lien Lender”). Under the Intercreditor Agreement, the Second Lien Lender has agreed to subordinate the obligations of the Credit Parties to them to the repayment of the obligations of the Credit Parties to the First Lien Lenders and have further agreed to subordinate their liens on the assets of the Credit Parties to the liens granted in favor of the First Lien Lenders. Absent the occurrence of an Event of Default under the First Lien Credit Agreement, the Second Lien Lender is permitted to receive regularly scheduled principal and interest payments under the Second Lien Credit Agreement. |
COMMITMENTS |
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Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS | COMMITMENTS The Company did not have any leases that met the criteria of a capital lease as of March 31, 2017 and 2016. Leases that do not qualify as capital leases are classified as operating leases. Operating lease rental and sublease rental payments included in general and administrative expenses are as follows:
The Company’s future minimum rental commitments under other operating leases are as follows. Twelve month period ending:
As of March 31, 2017, the Company had signed contractual commitments with several suppliers totaling $3,051 ($1,526 as of March 31, 2016) in connection with capital expenditures and drydock projects due in less than one year. |
CONTINGENCIES |
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Loss Contingency [Abstract] | |
CONTINGENCIES | CONTINGENCIES The Company is not involved in any legal proceedings which management expects to have a material adverse effect on the Company's business, financial position, results of operations or liquidity, nor is the Company aware of any proceedings that are pending or threatened which management believes may have a material adverse effect on the Company’s business, financial position, results of operations or liquidity. From time to time, the Company may be subject to ordinary routine litigation and claims incidental to the business principally involving commercial charter party disputes, and claims for alleged property damages, personal injuries and other matters. Those claims, even if lacking merit, could result in the expenditure of significant financial and managerial resources. It is expected that larger claims would be covered by insurance, subject to customary deductibles, if they involve liabilities that may arise from collision, other marine casualty, damage to cargoes, oil pollution, death or personal injuries to crew. The Company evaluates the need for loss accruals under the requirements of ASC 450 – Contingencies. The Company records an estimated loss for any claim, lawsuit, investigation or proceeding when it is probable that a liability has been incurred and the amount of the loss can reasonably be estimated. If the reasonable estimate of a probable loss is a range, and no amount within the range is a better estimate, then the Company records the minimum amount in the range as the loss accrual. If a loss is not probable or a probable loss cannot be reasonably estimated, no liability is recorded. As of March 31, 2017, an accrual of $365 ($305 as of March 31, 2016) was recorded for various claims. Management believes that it has recorded adequate reserves and believes that it has adequate insurance coverage or has meritorious defenses for these claims, however the Company cannot assure that such reserves will be sufficient to cover all costs incurred, or that insurance will be available or sufficient, or that any defenses asserted by management will be successful. |
STOCKHOLDERS' EQUITY |
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Stockholders' Equity Note [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITY On September 21, 2011, the Company completed a public underwritten offering of 2,800,000 shares of the Company’s common stock for $6.00 per share. The Company’s proceeds from the offering, net of underwriter’s commissions and expenses, were $15,525. On February 11, 2011, in connection with the Company's acquisition of two vessels, the Company issued 1,305,963 shares of the Company’s common stock to the seller of such vessels. Such shares were valued at $5.175, the average high and low per share price on that day. The Company is authorized to issue 1,000,000 shares of preferred stock with such designations, voting and other rights and preferences that may be determined from time to time by the Board of Directors. On March 3, 2006, the Company issued 300,000 shares of series A convertible preferred stock. The shares of the Company's series A convertible preferred stock: rank senior to the Company’s common stock with respect to liquidation and dividends; are entitled to receive a cash dividend at the annual rate of 7.75% (based on the $50 per share issue price) payable quarterly (subject to increases of 0.5% for each six month period in respect of which the dividend is not timely paid, up to a maximum of 12%, subject to reversion to 7.75% upon payment of all accrued and unpaid dividends); are convertible into shares of the Company’s common stock at any time at the option of the series A preferred stockholder at a conversion price of $6.20 per share (based on the $50 per share issue price and subject to adjustment) or 8.065 shares of common stock for each series A convertible preferred share (subject to adjustment); are convertible into shares of the Company’s common stock (based on a conversion price of $6.20 per share, subject to adjustment) at the option of the Company if, after the third anniversary of the acquisition, the trading price of the Company’s common stock for 20 trading days within any 30 trading day period equals or exceeds $8.50 per share (subject to adjustment); may be redeemed by the Company in connection with certain change of control or acquisition transactions; will vote on an as-converted basis with the Company’s common stock; and have a separate vote over certain material transactions or changes involving the Company. In March 2016, 4,520 shares of series A convertible preferred stock were converted into common stock at a conversion price of $6.20 per share. The accrued preferred stock dividends payable at March 31, 2017 were $3,563 and at March 31, 2016 were $1,920. As of March 31, 2017 the effective dividend rate of the preferred stock was 9.75%. As of March 31, 2016, the effective dividend rate of the preferred stock was 8.75%. Since January 2007, share-based compensation has been granted to management and directors from time to time. The Company had no surviving, outstanding share-based compensation agreements with employees or directors prior to that date except as described below. The Company has reserved 2,500,000 shares for issuance under the Company’s 2007 Long Term Incentive Plan (the “LTIP”) to employees, officers, directors and consultants. At March 31, 2017, a total of 25,886 shares (267,785 shares at March 31, 2016) were available under the LTIP for future awards. The LTIP expires on July 26, 2017, except with respect to awards then outstanding, which will remain outstanding until exercised, cancelled or expired in accordance with their terms. After July 26, 2017, no further awards shall be granted under the LTIP.
The following table summarizes shares issued to officers under employment agreements and restricted stock agreements from time to time.
For all share-based compensation, as employees and directors render service over the vesting periods, expense is recorded in general and administrative expenses. Share capital and additional paid-in capital are increased on the grant date with an offset to prepaid assets. Grant date fair value for all non-option share-based compensation is the average of the high and low trading prices on the date of grant. 18. STOCKHOLDERS’ EQUITY (continued) The general characteristics of share-based awards granted under the LTIP through March 31, 2017 are as follows: Stock Awards - All of the shares issued to non-employee outside directors vest immediately. The first award to non-employee outside directors in the amount of 12,909 shares was made on February 13, 2008 for services through March 31, 2008. During the fiscal year ended March 31, 2009, the Company awarded 15,948 shares for services from April 1, 2008 through December 31, 2008. The Company awarded 37,144 shares during the fiscal year ended March 31, 2010 for services from January 1, 2009 through March 31, 2010. During the fiscal year ended March 31, 2011, the Company awarded 14,007 shares for services provided from April 1, 2010 through March 31, 2011. During the fiscal year ended March 31, 2012, the Company awarded 10,722 shares for services from April 1, 2011 to March 31, 2012. During the fiscal year ended March 31, 2013, the Company awarded 10,854 shares for services provided from April 1, 2012 to March 31, 2013. During the fiscal year ended March 31, 2014, the Company awarded 19,256 shares for services rendered from April 1, 2013 to March 31, 2014. During the fiscal year ended March 31, 2015, the Company awarded 26,067 shares for services rendered from April 1, 2014 to March 31, 2015. For the fiscal year ended March 31, 2016, the Company awarded 92,167 shares for services provided from April 1, 2015 through March 31, 2016. For the fiscal year ended March 31, 2017, the Company awarded 161,733 shares for services rendered from April 1, 2016 to March 31, 2017. Grant date fair value for all these awards is the average of the high and low trading prices of the Company’s common stock on the date of grant. On July 31, 2008, the Company’s Board of Directors authorized management to make payments effective as of that date to the participants in the management bonus program. Pursuant to the terms of the management bonus program, the Company issued 478,232 shares of common stock to such employee participants. On October 27, 2015, the Company issued 111,025 shares to two executives pursuant to the terms of their severance agreements. Stock Options - Stock options granted to management employees vest over three years in equal annual installments. All options issued through March 31, 2017 expire ten years from the date of grant. Stock option grant date fair values are determined at the date of grant using a Black-Scholes option pricing model, a closed-form fair value model based on exercise price and market prices at the date of grant and other assumptions. At each grant date the Company has estimated a dividend yield of 0%. The weighted average risk free interest rate within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant, which was 4.14% for the fiscal 2009 (July 2008) grant, 0.80% to 1.60% for the fiscal 2016 grant and 1.24% for the fiscal 2017 grant. Expected volatility was 39.49% for the fiscal 2009 grant, 33.5% to 37.2% for the fiscal 2016 grant and 42.46% for fiscal 2017 grant. All of the stock options granted in February 2008 (243,199) and July 2008 (236,586), had vested as of March 31, 2017. During the twelve months ended March 31, 2017, 136,267 options expired. During the twelve month period ended March 31, 2016, 306,766 options expired. Options outstanding (341,752) at March 31, 2017 had a remaining weighted average contractual life of approximately three years and three months. The Company recorded compensation expenses related to such stock options of $56 for the twelve month period ended March 31, 2017 and $31 for the twelve month period ended March 31, 2016. None of the outstanding stock options were in-the-money as of March 31, 2017 or March 31, 2016. 18. STOCKHOLDERS’ EQUITY (continued)
18. STOCKHOLDERS’ EQUITY (continued) Shares issued in lieu of cash compensation - The Company experienced a decrease in customer demand at the beginning of the 2009 sailing season and in an effort to maximize the Company’s liquidity, the Compensation Committee of the Company’s Board of Directors requested that three of the Company’s executive officers and all of its outside directors receive common stock as compensation in lieu of cash until the Company had better visibility about its outlook. As of November 16, 2009, the Company issued 158,325 shares to such officers and all of its outside directors at the average of the high and low sale prices of the Company’s common stock on the date of grant. The shares were issued under the LTIP and vested immediately. Beginning the third quarter of the fiscal year ended March 31, 2010, such executives' and outside directors’ compensation reverted back to cash. On September 16, 2010, the Company issued 15,153 shares to a key executive for payment of the fiscal year 2010 bonus. On February 15, 2013, the Company issued 94,993 shares to eligible Canadian and U.S. employees for a bonus. On December 8, 2015, the Company issued 61,622 shares to eligible Canadian and U.S. employees for incentive compensation. On April 1, 2016, the Company issued 1,000 shares to an executive as a signing bonus. Grant date fair value for all these share awards is the average of the high and low trading prices of the Company’s common stock on the date of grant. Each of these share grants were issued under the LTIP and vested immediately. Restricted Stock Units - On June 27, 2014, the Company issued 30,050 Restricted Stock Units (“RSU”) to eligible U.S. and Canadian employees under the LTIP. Each RSU represents one share of the Company's common stock. The grant date fair value of each RSU was $5.99, which represents the average of the high and low sale prices of the Company’s common stock on the date of grant. One-third of the RSUs vest on March 31st of each year, beginning on March 31, 2015 and are therefore fully vested as of March 31, 2017. RSUs are not entitled to dividends or voting rights, if any, until the underlying shares of common stock are delivered. The total compensation cost of this grant is $204, net of estimated forfeitures. The fair value of the RSU awards is recognized on a straight-line basis over the vesting period. The Company recorded expense of $60 for the twelve month period ended March 31, 2017 and $57 for the twelve month period ended March 31, 2016. On the first vesting date of March 31, 2015, 10,559 shares vested. On the second vesting date of March 31, 2016, 8,905 shares vested. On the third vesting date of March 31, 2017, 8,718 shares vested. |
OUTSIDE VOYAGE CHARTER FEES |
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Mar. 31, 2017 | |
Outside Voyage Charter Fees [Abstract] | |
OUTSIDE VOYAGE CHARTER FEES | OUTSIDE VOYAGE CHARTER FEES Outside voyage charter fees relate to the subcontracting of external vessels chartered to service the Company’s customers and supplement the existing shipments made by the Company’s operated vessels. The Company was not part of any such arrangements during the twelve months period ended March 31, 2017. |
INTEREST EXPENSE |
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INTEREST EXPENSE | INTEREST EXPENSE Interest expense, net of interest capitalized is comprised of the following:
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RESTRUCTURING CHARGES |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||
RESTRUTURING CHARGES | RESTRUCTURING CHARGES In connection with cost-reduction and operating efficiency initiatives, which primarily include the streamlining of certain functions, locations and the management structure to support the business, and implementing the necessary system changes to support these initiatives, the Company has recorded expenses of $2,375 during the three month period ended June 30, 2016 as restructuring costs that primarily include severance costs and related benefits. The Company follows guidance provided in ASC 420, "Exit or Disposal Cost Obligations." The Company recognized the liability incurred in the three month period ended June 30, 2016 and any future operating losses will be recognized in the period(s) they are incurred. The following table summarizes activities in the restructuring costs accrual balance during the twelve month periods ended on March 31, 2017 and March 31, 2016:
The restructuring costs accrual balance is included in accrued liabilities (see Note 13). |
SEGMENT INFORMATION |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENT INFORMATION | SEGMENT INFORMATION The Company has identified one reportable operating segment under ASC 280 “Segment Reporting.” Information about geographic operations is as follows:
Revenues from external customers are allocated based on the country of the legal entity of the Company in which the revenues were recognized.
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FINANCIAL INSTRUMENTS |
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Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS Fair value of financial instruments Financial instruments are comprised of cash and cash equivalents, accounts receivable, accounts payable, senior and subordinated debts, a deferred payment liability and accrued liabilities. The estimated fair values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate book values because of the short-term maturities of these instruments. The estimated fair value of senior and subordinated debt approximates the carrying value as the debt bears interest at variable interest rates, which are based on rates for similar debt with similar credit rates in the open market. The deferred payment liabilities are valued based on the interest rate of similar debt in the open market. Commencing August 2014, the Company entered into rolling foreign currency hedge contracts of various amounts to mitigate currency fluctuation risk on its subordinated U.S. dollar denominated debt owed by Lower Lakes Towing. Fair value guidance establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The following table provides the fair value of the foreign currency hedge contracts measured on a recurring basis as of March 31, 2017 and March 31, 2016:
The foreign currency hedge contracts are measured at fair value using available rates on the similar instruments and are classified within Level 2 of the valuation hierarchy. These contracts are accounted for using the mark-to-market accounting method as if they were terminated at the day of valuation. There were no transfers into or out of Levels 1 and 2 of the fair value hierarchy during the twelve month period ended March 31, 2017. The Company recorded a payable of $0 as of March 31, 2017 for the foreign currency hedge contract on the Company’s U.S. dollar denominated subordinated debt owed by Lower Lakes Towing. For the twelve month period ended March 31, 2017, the fair value adjustments of the foreign currency hedge contract resulted in a gain of $3,104 (gain of $795 for the twelve month period ended March 31, 2016). These gains are included in the Company’s earnings, and the fair value of settlement costs to terminate the contracts was included in current liabilities on the Company's consolidated balance sheets. 23. FINANCIAL INSTRUMENTS (continued) The following table sets forth the fair value of the foreign currency hedge instruments as of the dates set forth below:
The Company has not designated these contracts as hedging instruments. The changes in fair value of the foreign currency hedge contracts are recorded in earnings as follows:
Foreign exchange risk Foreign currency exchange risk to the Company results primarily from changes in exchange rates between the Company’s reporting currency, the U.S. Dollar, and the Canadian dollar. As discussed above, in August 2014, the Company commenced entering into rolling foreign currency hedge contracts to mitigate currency fluctuation risk on its U.S. dollar denominated subordinated debt owed by Lower Lakes Towing. The Company is exposed to fluctuations in foreign exchange as a significant portion of revenue and operating expenses are denominated in Canadian dollars. Interest rate risk The Company is exposed to fluctuations in interest rates as a result of its banking facilities and senior debt bearing variable interest rates. In December 2012, the Company entered into two interest rate cap contracts covering 50% of its then outstanding term debt on the date of such contracts at a cap of three month LIBOR at 2.5% on its U.S. term debt borrowings and a cap of three month BA rates at 3.0% on its Canadian term debt borrowings. The notional amount on each of these instruments decreased with each scheduled principal payment of a term loan, notwithstanding the termination of such agreement. The interest rate cap contracts terminated on December 1, 2015 and were not renewed. Credit risk Accounts receivable credit risk is mitigated by the diversification of the Company’s customers among industries and the short shipping season. 23. FINANCIAL INSTRUMENTS (continued) Liquidity risk Tightened credit in financial markets or an economic downturn in certain of our markets may adversely affect the ability of the Company’s customers and suppliers to obtain financing for significant operations and purchases and to perform their obligations under agreements with the Company. A tightening of credit could (i) result in a decrease in, or cancellation of, existing business, (ii) limit new business, (iii) negatively impact the Company’s ability to collect accounts receivable on a timely basis and (iv) affect the eligible receivables that are collateral for the Company’s lines of credit. Excluding vessel acquisitions or major vessel conversion contracts, the Company makes seasonal net incremental borrowings under its borrowing arrangements during the first quarter of each fiscal year to fund working capital needed to commence the sailing season. The Company attempts to reduce the amounts outstanding under the related borrowing arrangements during the second half of each fiscal year. |
EARNINGS PER SHARE ("EPS") |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE | EARNINGS (LOSS) PER SHARE ("EPS") The Company had a total of 18,633,149 shares of common stock issued and outstanding as of March 31, 2017, out of an authorized total of 50,000,000 shares. The diluted calculation considers a total of 20,794,546 and 20,428,838 shares for the twelve month periods ended March 31, 2017 and 2016, respectively. The calculations for the twelve month periods ended March 31, 2017 and March 31, 2016 are anti-dilutive, therefore the basic and diluted weighted average shares outstanding are 18,411,690 and 18,045,935, respectively. The convertible preferred shares outstanding as of March 31, 2017 and March 31, 2016 convert to an aggregate of 2,382,903 common shares based on a conversion price of $6.20 per share.
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RELATED PARTY TRANSACTIONS |
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Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Prior to March 1, 2016, the Company occupied office space provided by an affiliate of our former chief executive officer (and a current member of the board of directors). The office space as well as certain office services, were made available to the Company during the term of the affiliate's five-year lease, which ended February 29, 2016. The Company paid the affiliate approximately $14 per month, such that total lease expense paid to such affiliate was $152 in the fiscal year ended March 31, 2016. The Company reimbursed two affiliates for certain out of pocket costs of $75 in fiscal 2016 for office expenses and other services. The consolidated statement of operations for the fiscal year ended March 31, 2016 includes $227 related to such transactions. In addition, the Company received $150 from the reimbursement of its portion of the affiliate's leased space security deposit in the year ended March 31, 2016. After February 29, 2016, the Company no longer leased this space. |
ECONOMIC DEPENDENCE |
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Mar. 31, 2017 | |
Risks and Uncertainties [Abstract] | |
ECONOMIC DEPENDENCE | ECONOMIC DEPENDENCE The Company had two customers in the fiscal year ended March 31, 2017, and one customer in the fiscal year ended March 31, 2016 that accounted for more than 10% of revenue. Customers in excess of 10% of revenues accounted for a total of 26.9% of net revenue in the fiscal year ended March 31, 2017 and 17.2% of net revenue in the fiscal year ended March 31, 2016. |
ACCUMULATED OTHER COMPREHENSIVE INCOME |
12 Months Ended |
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Mar. 31, 2017 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) ASC 220, “Comprehensive Income”, establishes standards for the reporting and display of comprehensive income (loss), which is defined as revenue, expenses, gains and losses that are recorded as an element of shareholders’ equity but are excluded from net income. Comprehensive (loss) income is reflected in the Consolidated Statement of Stockholder's equity and Other Comprehensive (Loss) Income. The components of, and changes in, comprehensive income (loss) and accumulated other comprehensive (loss) income consist of translation adjustments arising from the translation of the parent Company accounts in the Canadian subsidiary from Canadian dollar functional currency to U.S. dollar reporting currency. Included in comprehensive (loss) income and accumulated other comprehensive income are the effects of foreign currency translation adjustments loss of $820 in the fiscal year ended March 31, 2017 and loss of $1,723 in the fiscal year ended March 31, 2016. |
SUBSEQUENT EVENT |
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Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | 28. SUBSEQUENT EVENTS Effective as of June 30, 2017, the parties to the First Lien Credit Agreement entered into a Second Amendment to Amendment No. 4 pursuant to which (i) the waiver with respect to the Company's failure to deliver the Company's audited financial statements for the fiscal year ending March 31, 2017 without a qualified audit opinion was further extended to July 14, 2017, (ii) the date by which the Company shall have agreed to a recapitalization transaction with the Second Lien Lender was further extended to July 28, 2017, (iii) the date by which the Company shall have delivered its April and May 2017 monthly financial statements was extended to July 10, 2017, and (iv) the lenders waived a breach of (a) the Maximum Senior Funded Debt to EBITDA Ratio covenant for the fiscal quarter ended March 31, 2017, and (b) the requirement that the debt under the First Lien Credit Agreement and Second Lien Credit Agreement not cease to be classified as long-term debt in the Company's audited financial statements, and (c) certain events of default having occurred under the Second Lien Credit Agreement, as discussed below, in each case, (a) through (c), through July 14, 2017. Effective as of June 30, 2017, the parties to the Second Lien Credit Agreement entered into a Second Amendment to the Fifth Amendment pursuant to which (i) the waiver with respect to the Company's failure to deliver the Company's audited financial statements for the fiscal year ending March 31, 2017 without a qualified audit opinion was further extended to July 14, 2017, (ii) the date by which the Company shall have agreed to a recapitalization transaction with the Second Lien Lender was further extended to July 28, 2017, (iii) the date by which the Company shall have delivered its April and May 2017 monthly financial statements was extended to July 10, 2017, and (iv) the lenders waived a breach of (a) the Maximum Senior Funded Debt to EBITDA Ratio and the Maximum Total Funded Debt to EBITDA Ratio covenants for the fiscal quarter ended March 31, 2017, and (b) the requirement that the debt under the First Lien Credit Agreement and Second Lien Credit Agreement not cease to be classified as long-term debt in the Company's audited financial statements, in each case, (a) and (b), through July 14, 2017. |
SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||
Cash and cash equivalents | Cash and cash equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. |
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Accounts receivable | Accounts receivable The majority of the Company’s accounts receivable are amounts due from customers and other accounts receivable, including insurance and Canadian harmonized sales tax refunds. The majority of accounts receivable are due within 30 to 60 days and are stated as amounts due from customers net of an allowance for doubtful accounts. The Company extends credit to its customers based upon its assessment of their creditworthiness and past payment history. Accounts outstanding longer than the contractual payment terms are considered past due. |
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Revenue and operating expenses recognition | Revenue and operating expenses recognition The Company generates revenues from freight billings under contracts of affreightment (voyage charters) generally on a rate per ton basis based on origin-destination and cargo carried. Voyage revenue is recognized ratably over the duration of a voyage, which average from 2 to 3 days, based on the relative transit time in each reporting period when the following conditions are met: the Company has a signed contract of affreightment, the contract price is fixed or determinable and collection is reasonably assured. Included in freight billings are other fees such as fuel surcharges and other freight surcharges, which represent pass-through charges to customers for toll fees, lockage fees and ice breaking fees paid to other parties. Fuel surcharges are recognized ratably over the duration of the voyage, while freight surcharges are recognized when the associated costs are incurred. Freight surcharges are less than 5% of total revenue for all periods presented. Marine operating costs included in vessel operating expenses such as crewing costs, fuel, tugs and insurance are recognized as incurred or consumed and thereby are recognized ratably in each reporting period. Repairs and maintenance and certain other insignificant costs are recognized as incurred. From time to time, the Company subcontracts excess customer demand to other freight providers. Service to customers under such arrangements is transparent to the customer and no additional services are provided to customers by the Company. Consequently, revenues recognized for customers serviced by freight subcontractors are recognized on the same basis as described above. Costs for subcontracted freight providers, presented as “outside voyage charter fees” in the consolidated statements of operations, are recognized as incurred and therefore are recognized ratably over the voyage. The Company accounts for sales taxes imposed on its services on a net basis in the consolidated statements of operations. In addition, all revenues are presented on a gross basis. |
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Vessel acquisitions | Vessel acquisitions Vessel acquisitions are stated at cost, which consists of the purchase price and any material incremental expenditures incurred upon acquisition, such as initial repairs, improvements, delivery expenses and other expenditures to prepare the vessel for its initial voyage. Subsequent expenditures for conversions and major improvements are also capitalized when they appreciably extend the life, increase the earnings capacity or improve the efficiency or safety of the vessels. Significant financing costs incurred during the construction period of the vessels are also capitalized and included in the vessels' cost. |
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Fuel and lubricant inventories | Fuel and lubricant inventories Raw materials, fuel and certain operating supplies are accounted for on a first-in, first-out cost method (based on monthly averages). Raw materials and fuel are stated at the lower of actual cost (first-in, first-out method) or market and are included in prepaid expenses and other current assets in the accompanying consolidated balance sheets. Operating supplies are stated at actual cost or average cost and are recognized in expenses as they are consumed. |
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Intangible assets and goodwill | Intangible assets and goodwill Intangible assets consist primarily of goodwill, deferred financing costs and customer relationships and contracts. Intangible assets are amortized as follows:
Deferred financing costs are amortized on a straight-line basis over the term of the related debt, which approximates the effective interest method. On adoption of ASU 2015-03 for the first quarter of the 2017 fiscal year ended March 31, 2017 (as discussed in Note 4), this cost, net of amortization is classified as an offset against our long-term debt and subordinated debt. |
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Property and equipment | Property and equipment Property and equipment are recorded at cost. Depreciation methods and periods for property and equipment are as follows:
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Impairment of fixed assets and finite-lived intangible assets | Impairment of fixed assets and finite-lived intangible assets Fixed assets (e.g., property and equipment) and finite-lived intangible assets (e.g., customer relationships and contracts) are tested for impairment upon the occurrence of a triggering event that indicates the carrying value of such an asset or asset group (e.g., tugs and barges) might be no longer recoverable. Examples of such triggering events include, but are not limited to, a significant disposal of a portion of such assets, an adverse change in the market involving the business employing the related asset(s), a significant decrease in the benefits realized from an acquired business, difficulties or delays in integrating the business, and a significant change in the operations of an acquired business. Once a triggering event has occurred, the recoverability test employed is based on whether the intent is to hold the asset(s) for continued use or to hold the asset(s) for sale. If the intent is to hold the asset(s) for continued use, the recoverability test involves a comparison of undiscounted cash flows excluding interest expense but including any proceeds from eventual disposition, against the carrying value of the asset(s) as an initial test. If the carrying value of such asset(s) exceeds the undiscounted cash flow, the carrying amount of the asset(s) would be deemed to be impaired. Impairment would then be measured as the difference between the fair value of the fixed or amortizing intangible asset and the carrying value of such asset(s). The Company generally determines fair value by using the discounted cash flow method. If the intent is to hold the asset(s) for sale and certain other criteria are met (i.e., the asset(s) can be disposed of currently, appropriate levels of authority have approved the sale and there is an actively pursuing buyer), the impairment test is a comparison of the carrying value of the asset(s) to its fair value less costs to sell. To the extent that the carrying value is greater than the fair value less costs to sell, an impairment loss is recognized for the difference. As of June 30, 2016, the Company determined that its smallest carrying capacity Canadian flag bulk carrier was unlikely to generate a sufficient long term return on capitalized expenses necessary to continue operating the vessel. As a result, the Company decided to retire this vessel. The Company has also determined that the carrying value of the vessel was greater than the fair value and hence impairment charges were recorded to write off the carrying value of the vessel. |
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Evaluation of goodwill for impairment | Evaluation of goodwill for impairment The Company annually (or more frequently, if required) reviews the carrying value of goodwill residing in its reporting units as of March 31, to determine whether impairment may exist. GAAP requires that goodwill and certain indefinite-lived intangible assets be assessed annually for impairment using fair value measurement techniques. Specifically, goodwill impairment is determined using a three-step process. The first step of the goodwill impairment test is to determine if the Company can perform a qualitative assessment before calculating the fair value of the reporting unit when testing goodwill for impairment. Only if the fair value of the reporting unit is determined, based on qualitative factors, to be more likely than not less than the carrying amount of the reporting unit, then entities are required to perform the next two steps of the goodwill impairment test. The second step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The estimates of fair value of the Company’s two reporting units, which are the Company’s Canadian and U.S. operations (excluding the parent), are determined using various valuation techniques with the primary techniques being a discounted cash flow analysis and peer analysis. A discounted cash flow analysis requires various judgmental assumptions, including assumptions about future cash flows, growth rates, and discount rates. The assumptions about future cash flows and growth rates are based on the Company’s forecast and long-term estimates. Discount rate assumptions are based on an assessment of the risk inherent in the respective reporting units. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the third step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the third step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The third step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. That is, the fair value of the reporting unit is allocated to all of the existing assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid to acquire the reporting unit. As of March 31, 2017, the Company conducted the quantitative assessment and determined that the fair values of its two reporting units were greater than their carrying amounts. |
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Drydock costs | Drydock costs Drydock costs incurred during statutory Canadian and United States certification processes are capitalized and amortized on a straight-line basis over the benefit period, which is generally sixty (60) months. Drydock costs include costs of work performed by third party shipyards and subcontractors and other direct expenses to complete the mandatory certification processes. |
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Repairs and maintenance | Repairs and maintenance The Company’s vessels require repairs and maintenance each year to ensure the fleet is operating efficiently during the shipping season. The majority of repairs and maintenance are conducted in January, February, and March of each year when the vessels are not engaged in affreightment activities. The Company expenses such routine repairs and maintenance costs as incurred. Significant repairs to the Company’s vessels, such as major engine overhauls and major hull steel repairs, are capitalized and amortized over the lesser of the remaining useful life of the upgrade or the asset repaired. |
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Income taxes | Income taxes The Company accounts for income taxes in accordance with Accounting Standards Codification ("ASC") 740 “Income Taxes,” which requires the determination of deferred tax assets and liabilities based on the differences between the financial statement and income tax bases of tax assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. A valuation allowance is recognized, if necessary, to measure tax benefits to the extent that, based on available evidence, it is more likely than not that they will be realized. Income tax expense (or benefit) for an interim period is based on income taxes computed for ordinary income or loss and income taxes computed for items or events that are not part of ordinary income or loss. At the end of each interim period, the Company applies an estimate of the effective tax rate expected to be applicable for the full fiscal year to the year-to-date ordinary income (or loss) at the end of the interim period. The Company classifies interest expense related to income tax liabilities, when applicable, as part of the interest expense in its consolidated statements of operations rather than income tax expense. To date, the Company has not incurred material interest expenses or penalties relating to assessed taxation amounts. Lower Lakes Towing is currently under examination by the Canadian taxing authority for the tax years 2014 and 2015. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin, New Jersey and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:
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Foreign currency translation | Foreign currency translation The Company uses the U.S. Dollar as its reporting currency. The functional currency of the Company's Canadian subsidiaries is the Canadian Dollar. The functional currency of the Company’s U.S. subsidiaries is the U.S. Dollar. Assets and liabilities denominated in foreign currencies are translated into U.S. Dollars at the rate of exchange at the balance sheet date, while revenue and expenses are translated at the average exchange rates prevailing during the respective month. Components of stockholders’ equity are translated at historical exchange rates. Exchange gains and losses resulting from translation are reflected in accumulated other comprehensive income or loss, except for financial assets and liabilities designated in foreign currency, which are reflected in the Company's consolidated statements of operations. |
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Advertising costs | Advertising costs The Company expenses all advertising costs as incurred. These costs are included in general and administrative expenses and were insignificant during the periods presented. |
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Use of estimates | Use of estimates The preparation of consolidated financial statements in conformity with 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions used in the preparation of these consolidated financial statements include the assumptions used in the determination of whether there is substantial doubt about the Company's ability to continue as a going concern, the assumptions used in determining the useful lives of long-lived assets, the assumptions used in determining whether assets are impaired, the assumptions used in determining the valuation allowance for deferred income tax assets and the assumptions used in stock-based compensation awards. Actual results could differ from those estimates. |
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Stock-based compensation | Stock-based compensation The Company recognizes compensation expense for all newly granted awards and awards modified, repurchased or cancelled based on fair value at the date of grant or the date of modification, if applicable. |
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Financial instruments | Financial instruments The Company accounts for its foreign currency hedge contracts on its subordinated debt utilizing ASC 815 “Derivatives and Hedging” ("ASC 815"). All changes in the fair value of any foreign currency hedge contracts are recorded in earnings and the fair value of settlement costs to terminate any foreign currency hedge contracts are included in current assets or current liabilities on the consolidated balance sheets. |
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Fair value of financial instruments | Fair value of financial instruments ASC 820 “Fair Value Measurements and Disclosures” ("ASC 820") defines fair value, establishes a framework for measuring fair value in GAAP and establishes a hierarchy that categorizes and prioritizes the inputs to be used to estimate fair value. The three levels of inputs used are as follows: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The disclosure requirements of ASC 815 and 820 related to the Company’s financial assets and liabilities are presented in Note 23. |
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Recently issued pronouncements | Revenue from Contracts with Customers In May 2014, the Financial Accounting Standard Board (the "FASB") issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition. ASU 2014-09 requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. ASU 2014-09 requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. ASU 2014-09 would have been effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. In July 2015, the FASB voted to delay the effective date of the new standard by one year to annual periods beginning after December 15, 2017. ASU 2014-09, as subsequently amended, shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. Early adoption is permitted as of the original effective date. In May 2016, the FASB issued ASU 2016-11, Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting ("ASU 2016-11"). ASU 2016-11 rescinds several SEC Staff Announcements that are codified in Topic 605, including, among other items, guidance relating to accounting for shipping and handling fees and freight services. In addition, in March 2016, the FASB issued ASU No. 2016-08 Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (“ASU 2016-08”), which clarifies the principal-versus-agent guidance in Topic 606 and requires an entity to determine whether the nature of its promise to provide goods or services to a customer is performed in a principal or agent capacity and to recognize revenue in a gross or net manner based on its principal/agent designation. In April 2016, the FASB also issued ASU No. 2016-10 Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing (“ASU 2016-10”), which amends the revenue guidance on identifying performance obligations and accounting for licenses of intellectual property. In May 2016, the FASB also issued ASU No. 2016-12 Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients (“ASU 2016-12”), which amends the revenue guidance to clarify measurement and presentation, as well as to include some practical expedients and policy elections. In December 2016, the FASB issued ASU 2016-20, “Technical Corrections and Improvements to Topic 606, Revenue From Contracts with Customers”. The update makes minor changes to ASU 2014-09. The technical corrections affect narrow aspects of the new revenue standard, including: loan guarantee fees, contract costs-impairment testing, contract costs - interaction of impairment testing with guidance in other topics, provisions for losses on construction-type and production-type contracts, scope of the new revenue standard, disclosure of remaining performance obligations, disclosure of prior-period performance obligations, a contract modification example, refund liability, advertising costs, fixed-odds wagering contracts in the casino industry, and cost capitalization for advisers to private and public funds.There are two transition methods available under the new standard, either cumulative effect or retrospective. ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 must be adopted concurrently with the adoption of ASU 2014-09. The Company is evaluating the effect, if any, that adopting these new accounting standards will have on the Company's consolidated financial statements and related disclosures. Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern In August 2014, the FASB issued Accounting Standards Update 2014-15, Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern ("ASU 2014-15"). ASU 2014-15 provides guidance on management's responsibility in evaluating whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable). ASU 2014-15 also provides guidance related to the required disclosures as a result of management's evaluation. The amendments in ASU 2014-15 are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Company adopted ASU 2014-15 for the year ended March 31, 2017. The required disclosures are presented in Note 3. 4. RECENTLY ISSUED PRONOUNCEMENTS (continued) Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. In April 2015, the FASB issued ASU 2015-03, Imputation of Interest - Simplifying the Presentation of Debt Issuance Costs ("ASU 2015-03"). This guidance requires that the debt issuance costs related to a recognized term debt liability be presented in the balance sheet as a direct deduction from the debt liability, consistent with the presentation of a debt discount. This amendment is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. The Company adopted the provisions of ASU 2015-03 for the first quarter of the 2017 fiscal year and has applied these provisions retrospectively to the prior period presented. As a result of the adoption of this pronouncement, our unamortized deferred financing costs at March 31, 2016 of $4,903 were reclassified from intangible assets to an offset against our long-term debt and subordinated debt. The effect of the adoption did not result in a change to equity or net income (See Notes 11, 14 and 15). Leases (Topic 842) In February 2016, the FASB issued ASU 2016-02, Leases ("ASU 2016-02"). ASU 2016-02 revises the existing guidance related to leases by requiring lessees to recognize a lease liability and a right-of-use asset for all leases, as well as additional disclosure regarding leasing arrangements. This standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and requires a modified retrospective adoption, with earlier adoption permitted. The Company is currently evaluating the effects of the adoption of ASU 2016-02 on its consolidated financial statements. Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"). ASU 2016-09 simplifies certain aspects of the accounting for share-based payment transactions, including tax consequences, classification of awards, the option to recognize stock compensation expense with actual forfeitures as they occur, and the classifications on the statement of cash flows. ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within each reporting period, with early adoption permitted. The Company is currently evaluating the effects of the adoption of ASU 2016-09 on its consolidated financial statements. Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The pronouncement provides clarification guidance on certain cash flow presentation issues such as debt prepayment or debt extinguishment costs and contingent consideration payments made after a business combination. This pronouncement is effective for interim and annual reporting periods beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the impact that this standard will have on its Consolidated Statements of Cash Flows. Income Taxes (Topic 740) - Intra-Entity Transfers of Assets Other Than Inventory In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740) - Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16"). ASU 2016-16 provides guidance on recognition of current income tax consequences for intra-entity asset transfers (other than inventory) at the time of transfer. This represents a change from current GAAP, where the consolidated tax consequences of intra-entity asset transfers are deferred from the time of transfer to a future period. The guidance is effective for annual reporting periods beginning after December 15, 2017 and interim periods within those fiscal years. Early adoption at the beginning of an annual period is permitted. The Company is currently assessing the potential impact that ASU 2016-16 will have on the financial statements and disclosures. 4. RECENTLY ISSUED PRONOUNCEMENTS (continued) Statement of Cash Flows (Topic 230): Restricted Cash In November 2016, the FASB issued ASU No. 2016-18, "Statement of Cash Flows (Topic 230): Restricted Cash", which requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of- period and end-of-period total amounts shown on the statement of cash flows. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company does not expect these amendments to have a material effect on its financial statements. Business Combinations (Topic 805) In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business” (“ASU 2017-01”), which adds guidance to assist companies evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or of businesses, and provides for a screen to determine when a transaction should be accounted for as the acquisition or disposal of assets and not of a business, potentially reducing the number of transactions that need to be further evaluated. ASU 2017-01 is effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. No disclosures are required at transition and early adoption is permitted. The Company is currently evaluating the impact of adopting the new guidance on its consolidated financial statements. Intangibles - Goodwill and Other (Topic 350) In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) ("ASU 2017-04"), which simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates on or after January 1, 2017. The Company is currently evaluating the impact of adopting ASU 2017-04 on its consolidated financial statements. Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets On February 22, 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-05, “Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets”, to clarify the scope of asset derecognition guidance and provide new guidance on the accounting for partial sales of nonfinancial assets. This guidance provides greater detail on what types of transactions should be accounted for within the scope of FASB Accounting Standards Codification (“ASC”) subtopic 610-20. The effective date for this update for public entities is for annual reporting periods beginning after December 15, 2017. The Company is evaluating the impact of the adoption of this ASU on its consolidated financial statements. 4. RECENTLY ISSUED PRONOUNCEMENTS (continued) Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. In May 2017, the FASB issued ASU No. 2017-09 “Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting”. ASU No. 2017-09 provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. ASU No. 2017-09 is effective for annual periods beginning after December 15, 2017 and interim periods within those years. The amendments in ASU No. 2017-09 are to be applied prospectively to an award modified on or after the adoption date, consequently the impact will be dependent on whether the Company modifies any of its share-based payment awards and the nature of such modifications. |
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Contingencies | The Company evaluates the need for loss accruals under the requirements of ASC 450 – Contingencies. The Company records an estimated loss for any claim, lawsuit, investigation or proceeding when it is probable that a liability has been incurred and the amount of the loss can reasonably be estimated. If the reasonable estimate of a probable loss is a range, and no amount within the range is a better estimate, then the Company records the minimum amount in the range as the loss accrual. If a loss is not probable or a probable loss cannot be reasonably estimated, no liability is recorded. |
SIGNIFICANT ACCOUNTING POLICIES (Tables) |
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Accounting Policies [Abstract] | |||||||||||||||||||
Amortization periods of intangible assets | Intangible assets consist primarily of goodwill, deferred financing costs and customer relationships and contracts. Intangible assets are amortized as follows:
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Useful lives of property and equipment | Property and equipment are recorded at cost. Depreciation methods and periods for property and equipment are as follows:
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Open tax years | Lower Lakes Towing is currently under examination by the Canadian taxing authority for the tax years 2014 and 2015. The Company's primary U.S. state income tax jurisdictions are Illinois, Indiana, Michigan, Minnesota, Pennsylvania, Wisconsin, New Jersey and New York and its only international jurisdictions are Canada and its province of Ontario. The following table summarizes the open fiscal tax years for each major jurisdiction:
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PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) |
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Components of prepaid expenses and other current assets | Prepaid expenses and other current assets are comprised of the following:
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INCOME TAXES INCOME TAXES (Tables) |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Income before Income Tax, Domestic and Foreign | Loss before income taxes was derived from the following sources:
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Schedule of Components of Income Tax Expense (Benefit) | The components of the provision (benefit) for income taxes are as follows:
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Schedule of Effective Income Tax Rate Reconciliation | The total provision (benefit) for income taxes differs from that amount which would be computed by applying the U.S. Federal and Canadian income tax rates to income (loss) before provision for income taxes as follows:
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Schedule of Deferred Tax Assets and Liabilities | The significant components of long-term deferred tax assets and liabilities are as follows:
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PROPERTY AND EQUIPMENT, NET (Tables) |
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Schedule of property and equipment | Property and equipment, net are comprised of the following:
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OTHER ASSETS (Tables) |
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Schedule of other assets | The current portion of such costs represents the amounts expected to be recognized as expenses during the next fiscal year.
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DEFERRED DRYDOCK COSTS, NET (Tables) |
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Schedule of deferred drydock costs | Deferred drydock costs, net are comprised of the following:
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Summary of changes in deferred drydock costs | The following table shows periodic deferrals of drydock costs and amortization.
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INTANGIBLE ASSETS, NET AND GOODWILL (Tables) |
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Schedule of intangible assets and goodwill | Intangibles, net are comprised of the following:
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Schedule of expected amortization expense | Intangible asset amortization over the next five years is estimated as follows: Twelve month period ending:
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ACCRUED LIABILITIES (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of accrued liabilities | Accrued liabilities are comprised of the following:
|
LONG-TERM DEBT (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of long-term debt instruments |
|
SUBORDINATED DEBT (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of long-term debt instruments |
|
COMMITMENTS (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of operating lease rental and sublease rental payments | Operating lease rental and sublease rental payments included in general and administrative expenses are as follows:
|
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Schedule of future minimum rental commitments | The Company’s future minimum rental commitments under other operating leases are as follows. Twelve month period ending:
|
STOCKHOLDERS' EQUITY (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of share-based compensation awards | The following table summarizes shares issued to officers under employment agreements and restricted stock agreements from time to time.
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Schedule of Share-based Compensation, Stock Options, Activity |
|
INTEREST EXPENSE (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest Expense [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of interest expense | Interest expense, net of interest capitalized is comprised of the following:
|
RESTRUCTURING CHARGES (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||
Summary of restructuring costs | The following table summarizes activities in the restructuring costs accrual balance during the twelve month periods ended on March 31, 2017 and March 31, 2016:
|
SEGMENT INFORMATION (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue and long-lived assets by geographical segment | Information about geographic operations is as follows:
Revenues from external customers are allocated based on the country of the legal entity of the Company in which the revenues were recognized.
|
FINANCIAL INSTRUMENTS (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Foreign Exchange Contracts, Statement of Financial Position | The following table sets forth the fair value of the foreign currency hedge instruments as of the dates set forth below:
The following table provides the fair value of the foreign currency hedge contracts measured on a recurring basis as of March 31, 2017 and March 31, 2016:
|
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Schedule of contracts not designated for hedge accounting treatment, changes in fair value recorded in earnings | The changes in fair value of the foreign currency hedge contracts are recorded in earnings as follows:
|
EARNINGS PER SHARE ("EPS") (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of earnings per share, basic and diluted |
|
GOING CONCERN (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
GOING CONCERN [Abstract] | ||
Net Income (Loss) Available to Common Stockholders, Basic | $ (19,871) | $ (5,565) |
Net Current Assets and Liabilities | (214,282) | |
Reclassified Long Term Debt to Current | $ 200,279 |
RECENTLY ISSUED PRONOUNCEMENTS (Details) $ in Thousands |
Mar. 31, 2016
USD ($)
|
---|---|
Accounting Changes and Error Corrections [Abstract] | |
Debt issuance costs, net | $ 4,903 |
ACCOUNTS RECEIVABLE, NET (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Mar. 31, 2016 |
---|---|---|
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | ||
Allowance for doubtful accounts | $ 113 | $ 116 |
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Mar. 31, 2016 |
---|---|---|
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid insurance | $ 302 | $ 1,012 |
Fuel and lubricants | 4,252 | 3,872 |
Deposits and other prepaids | 1,655 | 1,436 |
Prepaid expenses and other current assets | $ 6,209 | $ 6,320 |
OTHER ASSETS (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Other Assets [Abstract] | ||
Amortization period of customer contract costs | 5 years | |
Customer contract costs | $ 72 | $ 287 |
Prepaid expenses and other assets | 6,178 | 6,135 |
Total | 6,250 | 6,422 |
Current portion | 6,209 | 6,320 |
Other long term assets | $ 41 | $ 102 |
DEFERRED DRYDOCK COSTS, NET (Balance Sheet Details) (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Mar. 31, 2016 |
Mar. 31, 2015 |
---|---|---|---|
Deferred Drydock Costs [Abstract] | |||
Deferred expenditures | $ 19,395 | $ 17,930 | |
Accumulated amortization | (10,593) | (11,270) | |
Deferred drydock costs, net | $ 8,802 | $ 6,660 | $ 7,590 |
DEFERRED DRYDOCK COSTS, NET (Changes in Deferred Balances) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Deferred Drydock Costs [Roll Forward] | ||
Balance at beginning of period | $ 6,660 | $ 7,590 |
Drydock costs accrued | 5,531 | 2,828 |
Amortization of drydock costs | (3,104) | (3,507) |
Unamortized dry-dock cost write-off for a retired vessel | (138) | |
Foreign currency translation adjustment | (147) | (251) |
Balance at end of period | $ 8,802 | $ 6,660 |
INTANGIBLE ASSETS, NET AND GOODWILL (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Mar. 31, 2016 |
---|---|---|
Finite-Lived Intangible Assets, Net [Abstract] | ||
Intangible assets, gross | $ 14,886 | $ 15,122 |
Accumulated amortization | 10,059 | 9,218 |
Intangible assets | 4,827 | 5,904 |
Goodwill | 10,193 | 10,193 |
Twelve month period ending: | ||
March 31, 2018 | 992 | |
March 31, 2019 | 993 | |
March 31, 2020 | 992 | |
March 31, 2021 | 930 | |
March 31, 2022 | 353 | |
Total | 4,260 | |
Customer relationships and contracts | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Intangible assets, gross | 14,886 | 15,122 |
Accumulated amortization | $ 10,059 | $ 9,218 |
VESSEL ACQUISITION (Details) $ in Thousands |
Mar. 11, 2014
USD ($)
|
---|---|
LalandiaSwan | Lower Lakes Towing (17) Ltd. | |
Vessel purchase price | $ 7,000 |
ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Mar. 31, 2016 |
---|---|---|
Payables and Accruals [Abstract] | ||
Deferred financing and other transaction costs | $ 0 | $ 4 |
Payroll compensation and benefits | 753 | 786 |
Preferred stock dividends | 3,563 | 1,920 |
Professional fees | 394 | 488 |
Interest | 2,393 | 2,305 |
Winter work, deferred drydock and capital expenditures | 5,882 | 834 |
Capital and franchise taxes | 52 | 12 |
Restructuring charges | 654 | 0 |
Other | 1,529 | 1,795 |
Accrued liabilities | $ 15,220 | $ 8,144 |
LONG-TERM DEBT (Schedule of Long-term Debt) (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Mar. 31, 2016 |
---|---|---|
Long-term Debt, Current and Noncurrent [Abstract] | ||
Long-term debt, gross | $ 121,196 | $ 114,520 |
Less unamortized debt issuance costs | (4,903) | |
Long-term debt | 119,702 | 112,426 |
Less amounts classified as current | 119,702 | 0 |
Long-term debt, excluding current maturities | 0 | 112,426 |
Revolving Credit Facility | ||
Long-term Debt, Current and Noncurrent [Abstract] | ||
Less unamortized debt issuance costs | (1,494) | (2,094) |
Credit Facilities | Canadian Guarantors | Revolving Credit Facility | Canadian Revolving Facility | ||
Long-term Debt, Current and Noncurrent [Abstract] | ||
Long-term debt, gross | 46,996 | 43,120 |
Credit Facilities | US Guarantors | Revolving Credit Facility | US Revolving Facility | ||
Long-term Debt, Current and Noncurrent [Abstract] | ||
Long-term debt, gross | $ 74,200 | $ 71,400 |
COMMITMENTS (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Commitments [Line Items] | ||
Rental payments | $ 612 | $ 735 |
Operating Leases, Future Minimum Payments Due, Rolling Maturity [Abstract] | ||
March 31, 2018 | 608 | |
March 31, 2019 | 547 | |
March 31, 2020 | 457 | |
March 31, 2021 | 242 | |
March 31, 2022 | 111 | |
Thereafter | 47 | |
Total | 2,012 | |
Contractual commitments | 3,051 | 1,526 |
Operating leases | ||
Commitments [Line Items] | ||
Rental payments | 612 | 560 |
Operating sublease | ||
Commitments [Line Items] | ||
Rental payments | $ 0 | $ 175 |
CONTINGENCIES (Details) - USD ($) $ in Thousands |
Mar. 31, 2017 |
Mar. 31, 2016 |
---|---|---|
Unasserted claim | ||
Contingencies: | ||
Contingency accrual | $ 365 | $ 305 |
INTEREST EXPENSE (Details) - USD ($) |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Interest Expense [Line Items] | ||
Amortization of deferred financing costs | $ 5,093,000 | $ 1,273,000 |
Interest rate caps | 0 | 6,000 |
Deferred payment liability | 30,000 | 64,000 |
Other interest | 0 | 34,000 |
Interest capitalized | 0 | (1,161,000) |
Interest expense | 19,463,000 | 12,461,000 |
Long-term debt - senior | ||
Interest Expense [Line Items] | ||
Debt | 4,757,000 | 3,979,000 |
Subordinated Debt | ||
Interest Expense [Line Items] | ||
Debt | $ 9,583,000 | $ 8,266,000 |
RESTRUCTURING CHARGES (Additional Information) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2016 |
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Restructuring and Related Activities [Abstract] | |||
Restructuring charges | $ 2,375 | $ 2,375 | $ 0 |
RESTRUCTURING CHARGES (Summary of Restructuring Costs) (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2016 |
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Restructuring and Related Activities [Abstract] | |||
Restructuring costs accrual | $ 2,375 | $ 2,375 | $ 0 |
Restructuring costs paid | (1,721) | 0 | |
Restructuring costs accrual balance | $ 654 | $ 0 |
SEGMENT INFORMATION (Details) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017
USD ($)
|
Mar. 31, 2016
USD ($)
|
|
Segment information: | ||
Number of operating segments | 1 | |
Revenue | $ 115,451 | $ 148,444 |
Property and equipment, net | 214,046 | 228,504 |
Intangible assets | 4,827 | 5,904 |
Goodwill | 10,193 | 10,193 |
Assets | 248,600 | 260,504 |
Canada | ||
Segment information: | ||
Revenue | 67,907 | 86,977 |
Property and equipment, net | 107,884 | 116,719 |
Intangible assets | 2,910 | 3,652 |
Goodwill | 8,284 | 8,284 |
Assets | 131,198 | 141,019 |
United States | ||
Segment information: | ||
Revenue | 47,544 | 61,467 |
Property and equipment, net | 106,162 | 111,785 |
Intangible assets | 1,917 | 2,252 |
Goodwill | 1,909 | 1,909 |
Assets | $ 117,402 | $ 119,485 |
FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Derivative [Line Items] | ||
Foreign currency hedge contracts | $ 0 | $ (268) |
(Gain) on foreign exchange | (3,104) | (795) |
Quoted prices in active markets (Level 1) | ||
Derivative [Line Items] | ||
Foreign currency hedge contracts | 0 | 0 |
Significant other observable inputs (Level 2) | ||
Derivative [Line Items] | ||
Foreign currency hedge contracts | $ 0 | $ (268) |
FINANCIAL INSTRUMENTS (Additional Information) (Details) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Mar. 31, 2017
USD ($)
|
Mar. 31, 2016
USD ($)
|
Dec. 12, 2012
interest_rate_cap_contract
|
|
Derivative [Line Items] | |||
Foreign currency hedge contracts | $ 0 | $ 268 | |
Gain on foreign exchange hedge contract | $ 3,104 | $ 795 | |
Derivatives not designated as hedging instrument | Interest Rate Cap | |||
Derivative [Line Items] | |||
Number of contracts entered into | interest_rate_cap_contract | 2 | ||
Percent of outstanding term debt covered | 50.00% | ||
UNITED STATES | Derivatives not designated as hedging instrument | Interest Rate Cap | |||
Derivative [Line Items] | |||
Fixed interest rate | 2.50% | ||
CANADA | Derivatives not designated as hedging instrument | Interest Rate Cap | |||
Derivative [Line Items] | |||
Fixed interest rate | 3.00% |
RELATED PARTY TRANSACTIONS (Details) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017
USD ($)
|
Mar. 31, 2016
USD ($)
affiliate
|
|
Related Party Transaction [Line Items] | ||
Rental payments | $ 612 | $ 735 |
Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Lease term | 5 years | |
Periodic payment | $ 14 | |
Rental payments | $ 152 | |
Number of affiliates reimbursed | affiliate | 2 | |
Office expenses and other services paid to affiliates | $ 75 | |
Related party transactions | 227 | |
Reimbursements received | $ 150 |
ECONOMIC DEPENDENCE (Details) - Sales Revenue, Services, Net - Customer Concentration Risk - customer |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Concentration Risk [Line Items] | ||
Number of major customers | 2 | 1 |
Concentration risk percentage | 26.90% | 17.20% |
ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Mar. 31, 2017 |
Mar. 31, 2016 |
|
Accumulated Other Comprehensive (Loss) Income | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Foreign currency translation adjustment loss | $ 820 | $ 1,723 |
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