Note 14 - Condensed Consolidating Financial Information of Guarantor Subsidiaries

3 Months Ended

Mar. 31, 2015

Condensed Consolidating Financial Information Of Guarantor Subsidiaries [Abstract]

Condensed Consolidating Financial Information Of Guarantor Subsidiaries [Text Block]

(14)           Condensed Consolidating Financial Information of Guarantor Subsidiaries

The Company has outstanding certain indebtedness that is guaranteed by all of its U.S. subsidiaries. However, the indebtedness is not guaranteed by the Company’s foreign subsidiaries. The guarantor subsidiaries are 100% owned and the guarantees are made on a joint and several basis, and are full and unconditional. Separate consolidated financial statements of the guarantor subsidiaries have not been presented because management believes that such information would not be material to investors. However, condensed consolidating financial information as of December 31, 2014 and March 31, 2015, and for the three months ended March 31, 2014 and 2015 is presented below. The Company (issuer of the Senior Unsecured Notes) was formed in June 2010 to implement a holding company organizational structure. As a result, all operating activities are conducted through the Company’s 100% owned subsidiaries.

Condensed Consolidating Statement of Operations

for the three months ended March 31, 2014

(In thousands)

	Guarantor Subsidiaries			Non-Guarantor Subsidiaries			ExamWorks Group, Inc. (Parent Corporation)			Consolidation and Elimination Entries		Consolidated Totals
Revenues	$	106,049		$	66,979		$	—		$	—	$	173,028
Costs and expenses:
Costs of revenues		71,067			39,968			—			—		111,035
Selling, general and administrative expenses		21,705			18,823			—			—		40,528
Depreciation and amortization		7,720			6,622			—			—		14,342
Total costs and expenses		100,492			65,413			—			—		165,905
Income from operations		5,557			1,566			—			—		7,123
Interest and other expenses, net		5,692			1,885			—			—		7,577
Loss before income taxes		(135	)		(319	)		—			—		(454	)
Provision (benefit) for income taxes		(1,642	)		1,477			—			—		(165	)
Net loss before earnings of consolidated subsidiaries	$	1,507		$	(1,796	)	$	—		$	—	$	(289	)
Net income (loss) of consolidated subsidiaries		(1,796	)		—			(1,796	)		3,592		—
Net income (loss)	$	(289	)	$	(1,796	)	$	(1,796	)	$	3,592	$	(289	)

Condensed Consolidating Statement of Operations

for the three months ended March 31, 2015

(In thousands)

	Guarantor Subsidiaries			Non-Guarantor Subsidiaries		ExamWorks Group, Inc. (Parent Corporation)		Consolidation and Elimination Entries			Consolidated Totals
Revenues	$	121,718		$	74,598	$	—	$	—		$	196,316
Costs and expenses:
Costs of revenues		82,334			45,842		—		—			128,176
Selling, general and administrative expenses		23,014			19,138		—		—			42,152
Depreciation and amortization		9,411			5,437		—		—			14,848
Total costs and expenses		114,759			70,417		—		—			185,176
Income from operations		6,959			4,181		—		—			11,140
Interest and other expenses, net		6,409			1,595		—		—			8,004
Income before income taxes		550			2,586		—		—			3,136
Provision (benefit) for income taxes		(594	)		1,706		—		—			1,112
Net income before earnings of consolidated subsidiaries	$	1,144		$	880	$	—	$	—		$	2,024
Net income (loss) of consolidated subsidiaries		880			—		880		(1,760	)		—
Net income (loss)	$	2,024		$	880	$	880	$	(1,760	)	$	2,024

Condensed Consolidating Balance Sheet as of December 31, 2014

(In thousands)

	Guarantor Subsidiaries		Non-Guarantor Subsidiaries		ExamWorks Group, Inc. (Parent Corporation)		Consolidation and Elimination Entries			Consolidated Totals
Assets
Current assets:
Cash and cash equivalents	$	388	$	9,363	$	—	$	—		$	9,751
Accounts receivable, net		55,684		147,505		—		—			203,189
Intercompany receivable		42,002		—		10,667		(52,669	)		—
Prepaid expenses		8,248		5,557		—		—			13,805
Deferred tax assets		3,780		—		—		(4	)		3,776
Other current assets		272		1,165		—		—			1,437
Total current assets		110,374		163,590		10,667		(52,673	)		231,958
Property, equipment and leasehold improvements, net		10,394		5,332		—		—			15,726
Investment in subsidiaries		217,344		—		591,435		(808,779	)		—
Intercompany notes receivable		174,464		—		174,464		(348,928	)		—
Goodwill		387,104		108,575		—		—			495,679
Intangible assets, net		64,530		38,053		—		—			102,583
Long-term accounts receivable, less current portion		—		46,401		—		—			46,401
Deferred tax assets, noncurrent		22,505		7,177		—		—			29,682
Deferred financing costs, net		6,140		29		—		—			6,169
Other assets		663		1,283		—		—			1,946
Total assets	$	993,518	$	370,440	$	776,566	$	(1,210,380	)	$	930,144
Liabilities and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable	$	20,163	$	36,870	$	—	$	—		$	57,033
Intercompany payable		10,667		42,002		—		(52,669	)		—
Accrued expenses		23,904		30,074		—		—			53,978
Accrued interest expense		—		—		10,667		—			10,667
Deferred revenue		244		6,158		—		—			6,402
Deferred tax liability		—		4		—		(4	)		—
Current portion of contingent earnout obligation		—		4,473		—		—			4,473
Current portion of working capital facilities		—		40,396		—		—			40,396
Other current liabilities		2,363		4,587		—		—			6,950
Total current liabilities		57,341		164,564		10,667		(52,673	)		179,899
Senior unsecured notes payable		—		—		250,000		—			250,000
Senior secured revolving credit facility and working capital facilities, less current portion		—		—		143,853		—			143,853
Intercompany notes payable		174,464		174,464		—		(348,928	)		—
Long-term contingent earnout obligation, less current portion		—		2,114		—		—			2,114
Other long-term liabilities		1,795		7,608		—		—			9,403
Total liabilities		233,600		348,750		404,520		(401,601	)		585,269
Commitments and contingencies
Stockholders’ equity (deficit)		759,918		21,690		372,046		(808,779	)		344,875
Total liabilities and stockholders' equity (deficit)	$	993,518	$	370,440	$	776,566	$	(1,210,380	)	$	930,144

Condensed Consolidating Balance Sheet as of March 31, 2015

(In thousands)

	Guarantor Subsidiaries		Non-Guarantor Subsidiaries		ExamWorks Group, Inc. (Parent Corporation)		Consolidation and Elimination Entries			Consolidated Totals
Assets
Current assets:
Cash and cash equivalents	$	9,202	$	11,080	$	—	$	—		$	20,282
Accounts receivable, net		57,518		148,241		—		—			205,759
Intercompany receivable		44,998		—		5,027		(50,025	)		—
Prepaid expenses		7,991		4,597		—		—			12,588
Deferred tax assets		3,938		101		—		—			4,039
Other current assets		958		1,113		—		—			2,071
Total current assets		124,605		165,132		5,027		(50,025	)		244,739
Property, equipment and leasehold improvements, net		11,118		4,937		—		—			16,055
Investment in subsidiaries		218,225		—		594,614		(812,839	)		—
Intercompany notes receivable		174,385		—		174,385		(348,770	)		—
Goodwill		388,379		101,628		—		—			490,007
Intangible assets, net		60,527		31,101		—		—			91,628
Long-term accounts receivable, less current portion		—		47,743		—		—			47,743
Deferred tax assets, noncurrent		38,661		7,076		—		—			45,737
Deferred financing costs, net		5,690		14		—		—			5,704
Other assets		695		1,454		—		—			2,149
Total assets	$	1,022,285	$	359,085	$	774,026	$	(1,211,634	)	$	943,762
Liabilities and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable	$	21,126	$	36,311	$	—	$	—		$	57,437
Intercompany payable		5,027		44,998		—		(50,025	)		—
Accrued expenses		23,343		29,102		—		—			52,445
Accrued interest expense		—		—		5,027		—			5,027
Deferred revenue		300		5,126		—		—			5,426
Current portion of contingent earnout obligation		—		4,393		—		—			4,393
Other current liabilities		2,634		4,601		—		—			7,235
Total current liabilities		52,430		124,531		5,027		(50,025	)		131,963
Senior unsecured notes payable		—		—		250,000		—			250,000
Senior secured revolving credit facility and working capital facilities, less current portion		—		38,447		140,000		—			178,447
Intercompany notes payable		174,385		174,385		—		(348,770	)		—
Deferred tax liability, noncurrent		10,580		—		—		—			10,580
Other long-term liabilities		3,364		8,255		—		—			11,619
Total liabilities		240,759		345,618		395,027		(398,795	)		582,609
Commitments and contingencies
Stockholders’ equity (deficit)		781,526		13,467		378,999		(812,839	)		361,153
Total liabilities and stockholders' equity (deficit)	$	1,022,285	$	359,085	$	774,026	$	(1,211,634	)	$	943,762

Condensed Consolidating Statement of Cash Flows for the three months ended March 31, 2014

(In thousands)

	Guarantor Subsidiaries			Non-Guarantor Subsidiaries			ExamWorks Group, Inc. (Parent Corporation)			Consolidation and Elimination Entries		Consolidated Totals
Net cash provided by operating activities	$	1,369		$	1,836		$	—		$	—	$	3,205
Investing activities:
Cash paid for acquisitions, net		(87,615	)		(9,538	)		—			—		(97,153	)
Purchases of building, equipment and leasehold improvements, net		(402	)		(310	)		—			—		(712	)
Working capital and other settlements for acquisitions		—			(1,142	)		—			—		(1,142	)
Cash paid for foreign currency net investment hedges		(3,356	)		—			—			—		(3,356	)
Other		(839	)		—			—			—		(839	)
Net cash used in investing activities		(92,212	)		(10,990	)		—			—		(103,202	)
Financing activities:
Borrowings under senior secured revolving credit facility		—			—			121,012			—		121,012
Proceeds from the exercise of options and warrants		—			—			14,637			—		14,637
Excess tax benefit related to share-based compensation		—			—			6,190			—		6,190
Net borrowings under working capital facilities		—			4,123			—			—		4,123
Payment of deferred financing costs		—			—			(225	)		—		(225	)
Repayment of subordinated unsecured notes payable		(333	)		—			—			—		(333	)
Repayment under senior secured revolving credit facility		—			—			(50,000	)		—		(50,000	)
Intercompany notes and investments and other		91,614			—			(91,614	)		—		—
Net cash provided by financing activities		91,281			4,123			—			—		95,404
Exchange rate impact on cash and cash equivalents		—			268			—			—		268
Net increase (decrease) in cash and cash equivalents		438			(4,763	)		—			—		(4,325	)
Cash and cash equivalents, beginning of period		760			12,069			—			—		12,829
Cash and cash equivalents, end of period	$	1,198		$	7,306		$	—		$	—	$	8,504

Condensed Consolidating Statement of Cash Flows for the three months ended March 31, 2015

(In thousands)

	Guarantor Subsidiaries			Non-Guarantor Subsidiaries			ExamWorks Group, Inc. (Parent Corporation)			Consolidation and Elimination Entries		Consolidated Totals
Net cash provided by operating activities	$	2,226		$	3,938		$	—		$	—	$	6,164
Investing activities:
Cash paid for acquisitions, net		(2,299	)		—			—			—		(2,299	)
Purchases of building, equipment and leasehold improvements, net		(1,670	)		(559	)		—			—		(2,229	)
Working capital and other settlements for acquisitions		(91	)		—			—			—		(91	)
Proceeds from foreign currency net investment hedges		4,812			—			—			—		4,812
Other		(1,250	)		—			—			—		(1,250	)
Net cash used in investing activities		(498	)		(559	)		—			—		(1,057	)
Financing activities:
Borrowings under senior secured revolving credit facility		—			—			25,478			—		25,478
Proceeds from the exercise of options and warrants		—			—			8,855			—		8,855
Excess tax benefit related to share-based compensation		—			—			2,086			—		2,086
Net repayments under working capital facilities		—			(132	)		—			—		(132	)
Repayment of contingent earnout obligation		—			(1,023	)		—			—		(1,023	)
Repayment under senior secured revolving credit facility		—			—			(29,331	)		—		(29,331	)
Intercompany notes and investments and other		7,088			—			(7,088	)		—		—
Net cash provided by financing activities		7,088			(1,155	)		—			—		5,933
Exchange rate impact on cash and cash equivalents		—			(509	)		—			—		(509	)
Net increase (decrease) in cash and cash equivalents		8,816			1,715			—			—		10,531
Cash and cash equivalents, beginning of period		388			9,363			—			—		9,751
Cash and cash equivalents, end of period	$	9,204		$	11,078		$	—		$	—	$	20,282