WALNUT CREEK, Calif.,
Aug. 1, 2017 /PRNewswire/ -- ARC Document Solutions, Inc.
(NYSE: ARC), a leading document solutions provider to design,
engineering, construction, and facilities management professionals,
today reported its financial results for the second quarter ended
June 30, 2017.
Financial
Highlights:
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
(All dollar
amounts in millions, except EPS)
|
2017
|
2016
|
|
2017
|
2016
|
Net Sales
|
$
|
102.3
|
|
$
|
103.8
|
|
|
$
|
201.0
|
|
$
|
207.3
|
|
Gross
Margin
|
33.7
|
%
|
35.1
|
%
|
|
32.5
|
%
|
33.8
|
%
|
Net income (loss)
attributable to ARC
|
$
|
3.6
|
|
$
|
(55.9)
|
|
|
$
|
5.4
|
|
$
|
(53.3)
|
|
Adjusted net income
attributable to ARC
|
$
|
3.7
|
|
$
|
4.8
|
|
|
$
|
5.6
|
|
$
|
7.5
|
|
Earnings per share -
Diluted
|
$
|
0.08
|
|
$
|
(1.22)
|
|
|
$
|
0.12
|
|
$
|
(1.15)
|
|
Adjusted earnings per
share - Diluted
|
$
|
0.08
|
|
$
|
0.10
|
|
|
$
|
0.12
|
|
$
|
0.16
|
|
Cash provided by
operating activities
|
$
|
18.5
|
|
$
|
16.6
|
|
|
$
|
25.4
|
|
$
|
21.9
|
|
EBITDA
|
$
|
16.1
|
|
$
|
(56.5)
|
|
|
$
|
28.9
|
|
$
|
(42.5)
|
|
Adjusted
EBITDA
|
$
|
17.0
|
|
$
|
18.1
|
|
|
$
|
30.6
|
|
$
|
32.9
|
|
Capital
Expenditures
|
$
|
2.9
|
|
$
|
2.6
|
|
|
$
|
4.9
|
|
$
|
5.2
|
|
Debt & Capital
Leases (including current), net of unamortized deferred financing
fees
|
|
|
|
$
|
152.0
|
|
$
|
164.9
|
|
Management Commentary
"From a financial perspective, the company had a strong second
quarter," said K. "Suri" Suriyakumar, Chairman, President and CEO
of ARC Document Solutions. "In the first half of 2017 we generated
nearly four million dollars more in
cash flows from operations than we did in 2016. Our second quarter
gross margin was a healthy 33.7%, and SG&A for the period was
essentially flat compared to 2016, even with our investments in
sales and marketing. This is extremely gratifying, especially in
light of continuing headwinds in print sales and our ongoing
transformation."
"In addition to this, we were also able to successfully
renegotiate our debt agreement with our banks," said Mr.
Suriyakumar. "Our previous agreements reflected a time when
the company was working towards stabilizing its revenues after an
unprecedented financial crisis. Today however, we need more
flexibility and dry powder to invest in areas where we can grow our
current market share, and accelerate revenues with our new
technology offerings. The new agreement provides us the ability to
do exactly that."
"Our margins and cash flow performance demonstrate the tight
controls over our expenses, and the leverage we can exert over
every dollar we make," said Jorge
Avalos, Chief Financial Officer for ARC Document Solutions.
"In addition to our strong financial performance in the second
quarter, it was rewarding to be able to enhance our capital
structure with our five-year amended credit agreement which reduces
our interest rate, and significantly improves our amortization
schedule."
2017 Second Quarter Supplemental Information:
Net sales were $102.3 million, a
1.4% decrease compared to the second quarter of 2016.
Days sales outstanding in Q2 2017 were 52, compared to 53 days
in Q2 2016.
Architectural, engineering, construction and building
owner/operators (AEC/O) customers comprised approximately 77% of
our total net sales, while customers outside of construction made
up approximately 23% of our total net sales.
Total number of MPS locations at the end of the second quarter
has grown to approximately 9,830, a net gain of approximately 590
locations over Q2 2016.
Adjusted EBITDA excludes loss on extinguishment of debt,
goodwill impairment, restructuring expense and stock-based
compensation expense.
Sales from
Services and Product Lines as a Percentage of Net
Sales
|
|
|
Three Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
Services and Product
Line
|
2017
|
2016
|
2017
|
2016
|
CDIM
|
52.5
|
%
|
52.9
|
%
|
52.2
|
%
|
52.3
|
%
|
MPS
|
32.3
|
%
|
32.8
|
%
|
32.6
|
%
|
32.5
|
%
|
AIM
|
3.1
|
%
|
3.5
|
%
|
3.2
|
%
|
3.6
|
%
|
Equipment and
supplies sales
|
12.1
|
%
|
10.8
|
%
|
12.0
|
%
|
11.6
|
%
|
Outlook
ARC Document Solutions maintained its annual forecast for 2017,
anticipating fully-diluted annual adjusted earnings per share to be
in the range of $0.24 to
$0.29; annual adjusted cash provided
by operating activities is projected to be in the range of
$49 to $54 million; and annual
adjusted EBITDA is forecast to be in the range of $58 million
to $63 million.
Teleconference and Webcast
ARC Document Solutions will hold a conference call with
investors and analysts on Tuesday, August 1,
2017, at 2 P.M. Pacific Time
(5 P.M. Eastern Time) to discuss
results for the company's 2017 second quarter. To access the live
audio call, dial 888-287-5530. International callers may join the
conference by dialing 719-325-2480. The conference ID number is
6116527. A live webcast will also be made available on the investor
relations page of ARC Document Solution's website at
http://ir.e-arc.com. The webcast of the call will be available for
approximately 90 days following the call's conclusion.
About ARC Document Solutions (NYSE: ARC)
ARC Document Solutions distributes Documents and Information to
facilitate communication for design, engineering and construction
professionals, real estate managers and developers, facilities
owners, and a variety of similar disciplines. The Company provides
cloud and mobile solutions, professional services, and hardware to
help its customers around the world reduce costs and increase
efficiency, improve information access and control, and communicate
faster, easier, and better. Follow ARC at www.e-arc.com.
Forward-Looking Statements
This press release contains forward-looking statements that are
based on current opinions, estimates and assumptions of management
regarding future events and the future financial performance of the
Company. Words and phrases such as "we are confident," "forecast,"
"expect," "believe," "anticipate," "outlook," and similar
expressions identify forward-looking statements and all statements
other than statements of historical fact, including, but not
limited to, any projections regarding earnings, revenues and
financial performance of the Company, could be deemed
forward-looking statements. We caution you that such statements are
only predictions and are subject to certain risks and uncertainties
that could cause actual results to differ materially from those
contained in the forward-looking statements. In addition to matters
affecting the construction, managed print services, document
management or reprographics industries, or the economy generally,
factors that could cause actual results to differ from expectations
stated in forward-looking statements include, among others, the
factors described in the caption entitled "Risk Factors" in Item 1A
in ARC Document Solution's Annual Report on Form 10-K for the
fiscal year ended December 31, 2016, Quarterly Reports on Form
10-Q, and other periodic filings and prospectuses. The Company
undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events,
or otherwise, except as required by law.
ARC Document
Solutions, Inc.
|
Consolidated
Balance Sheets
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
June
30,
|
December
31,
|
Current
assets:
|
2017
|
2016
|
Cash and cash
equivalents
|
$
|
26,604
|
|
$
|
25,239
|
|
Accounts receivable,
net of allowances for accounts receivable of $2,376 and
$2,060
|
59,565
|
|
59,735
|
|
Inventories,
net
|
18,733
|
|
18,184
|
|
Prepaid
expenses
|
5,613
|
|
3,861
|
|
Other current
assets
|
5,265
|
|
4,785
|
|
Total current
assets
|
115,780
|
|
111,804
|
|
Property and
equipment, net of accumulated depreciation of $206,959 and
$201,192
|
64,078
|
|
60,735
|
|
Goodwill
|
138,688
|
|
138,688
|
|
Other intangible
assets, net
|
11,094
|
|
13,202
|
|
Deferred income
taxes
|
39,397
|
|
42,667
|
|
Other
assets
|
2,345
|
|
2,185
|
|
Total
assets
|
$
|
371,382
|
|
$
|
369,281
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$
|
22,246
|
|
$
|
24,782
|
|
Accrued payroll and
payroll-related expenses
|
12,951
|
|
12,219
|
|
Accrued
expenses
|
16,532
|
|
16,138
|
|
Current portion of
long-term debt and capital leases
|
15,162
|
|
13,773
|
|
Total current
liabilities
|
66,891
|
|
66,912
|
|
Long-term debt and
capital leases
|
136,805
|
|
143,400
|
|
Other long-term
liabilities
|
2,639
|
|
2,148
|
|
Total
liabilities
|
206,335
|
|
212,460
|
|
Commitments and
contingencies
|
|
|
Stockholders'
equity:
|
|
|
ARC Document
Solutions, Inc. stockholders' equity:
|
|
|
Preferred stock,
$0.001 par value, 25,000 shares authorized; 0 shares issued
and outstanding
|
—
|
|
—
|
|
Common stock, $0.001
par value, 150,000 shares authorized; 47,880 and 47,428
shares issued and 46,440 and 45,988 shares
outstanding
|
48
|
|
47
|
|
Additional paid-in
capital
|
119,467
|
|
117,749
|
|
Retained
earnings
|
47,455
|
|
41,822
|
|
Accumulated other
comprehensive loss
|
(3,139)
|
|
(3,793)
|
|
|
163,831
|
|
155,825
|
|
Less cost of common
stock in treasury, 1,440 shares
|
5,909
|
|
5,909
|
|
Total
ARC Document Solutions, Inc. stockholders' equity
|
157,922
|
|
149,916
|
|
Noncontrolling
interest
|
7,125
|
|
6,905
|
|
Total
equity
|
165,047
|
|
156,821
|
|
Total
liabilities and equity
|
$
|
371,382
|
|
$
|
369,281
|
|
ARC Document
Solutions, Inc.
|
Consolidated
Statements of Operations
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
Three Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
|
2017
|
2016
|
2017
|
2016
|
Service
sales
|
$
|
89,870
|
|
$
|
92,581
|
|
$
|
176,834
|
|
$
|
183,216
|
|
Equipment and
supplies sales
|
12,410
|
|
11,189
|
|
24,177
|
|
24,104
|
|
Total net
sales
|
102,280
|
|
103,770
|
|
201,011
|
|
207,320
|
|
Cost of
sales
|
67,794
|
|
67,378
|
|
135,687
|
|
137,191
|
|
Gross
profit
|
34,486
|
|
36,392
|
|
65,324
|
|
70,129
|
|
Selling, general and
administrative expenses
|
25,550
|
|
25,503
|
|
50,697
|
|
51,859
|
|
Amortization of
intangible assets
|
1,082
|
|
1,232
|
|
2,197
|
|
2,545
|
|
Goodwill
impairment
|
—
|
|
73,920
|
|
—
|
|
73,920
|
|
Restructuring
expense
|
—
|
|
5
|
|
—
|
|
7
|
|
Income (loss) from
operations
|
7,854
|
|
(64,268)
|
|
12,430
|
|
(58,202)
|
|
Other income,
net
|
(22)
|
|
(15)
|
|
(41)
|
|
(38)
|
|
Loss on
extinguishment of debt
|
40
|
|
44
|
|
106
|
|
90
|
|
Interest expense,
net
|
1,594
|
|
1,526
|
|
3,149
|
|
2,972
|
|
Income (loss) before
income tax provision (benefit)
|
6,242
|
|
(65,823)
|
|
9,216
|
|
(61,226)
|
|
Income tax provision
(benefit)
|
2,522
|
|
(10,015)
|
|
3,748
|
|
(8,046)
|
|
Net income
(loss)
|
3,720
|
|
(55,808)
|
|
5,468
|
|
(53,180)
|
|
Income attributable
to the noncontrolling interest
|
(84)
|
|
(96)
|
|
(48)
|
|
(150)
|
|
Net income (loss)
attributable to ARC Document Solutions, Inc.
shareholders
|
$
|
3,636
|
|
$
|
(55,904)
|
|
$
|
5,420
|
|
$
|
(53,330)
|
|
Earnings (loss) per
share attributable to ARC Document Solutions, Inc.
shareholders:
|
|
|
|
|
Basic
|
$
|
0.08
|
|
$
|
(1.22)
|
|
$
|
0.12
|
|
$
|
(1.15)
|
|
Diluted
|
$
|
0.08
|
|
$
|
(1.22)
|
|
$
|
0.12
|
|
$
|
(1.15)
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
Basic
|
45,792
|
|
45,955
|
|
45,716
|
|
46,285
|
|
Diluted
|
46,258
|
|
45,955
|
|
46,329
|
|
46,285
|
|
ARC Document
Solutions, Inc.
|
Non-GAAP
Measures
|
Reconciliation of
cash flows provided by operating activities to EBITDA and Adjusted
EBITDA
|
(In
thousands)
|
(Unaudited)
|
|
Three Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
|
2017
|
2016
|
2017
|
2016
|
Cash flows provided
by operating activities
|
$
|
18,488
|
|
$
|
16,580
|
|
$
|
25,430
|
|
$
|
21,883
|
|
Changes in operating
assets and liabilities, net of effect of business
acquisitions
|
(2,993)
|
|
209
|
|
2,365
|
|
8,018
|
|
Non-cash expenses,
including depreciation, amortization and goodwill
impairment
|
(11,775)
|
|
(72,597)
|
|
(22,327)
|
|
(83,081)
|
|
Income tax provision
(benefit)
|
2,522
|
|
(10,015)
|
|
3,748
|
|
(8,046)
|
|
Interest expense,
net
|
1,594
|
|
1,526
|
|
3,149
|
|
2,972
|
|
Income attributable
to the noncontrolling interest
|
(84)
|
|
(96)
|
|
(48)
|
|
(150)
|
|
Depreciation and
amortization
|
8,353
|
|
7,890
|
|
16,607
|
|
15,880
|
|
EBITDA
|
16,105
|
|
(56,503)
|
|
28,924
|
|
(42,524)
|
|
Loss on
extinguishment of debt
|
40
|
|
44
|
|
106
|
|
90
|
|
Goodwill
impairment
|
—
|
|
73,920
|
|
—
|
|
73,920
|
|
Restructuring
expense(1)
|
—
|
|
5
|
|
—
|
|
7
|
|
Stock-based
compensation
|
816
|
|
651
|
|
1,553
|
|
1,423
|
|
Adjusted
EBITDA
|
$
|
16,961
|
|
$
|
18,117
|
|
$
|
30,583
|
|
$
|
32,916
|
|
|
(1)
In October 2012, we initiated a restructuring plan which included
the closure or downsizing of the Company's service center
locations, as well as a reduction in headcount. Restructuring
expenses in 2016 primarily consist of revised estimated lease
termination and obligation costs resulting from facilities closed
in 2013.
|
ARC Document
Solutions, Inc.
|
Non-GAAP
Measures
|
Reconciliation of
net income attributable to ARC to unaudited adjusted net income
attributable to ARC
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
Three Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
|
2017
|
2016
|
2017
|
2016
|
Net income (loss)
attributable to ARC Document Solutions, Inc.
|
$
|
3,636
|
|
$
|
(55,904)
|
|
$
|
5,420
|
|
$
|
(53,330)
|
|
Loss on
extinguishment of debt
|
40
|
|
44
|
|
106
|
|
90
|
|
Goodwill
impairment
|
—
|
|
73,920
|
|
—
|
|
73,920
|
|
Restructuring
expense
|
—
|
|
5
|
|
—
|
|
7
|
|
Income tax benefit
related to above items
|
(16)
|
|
(13,350)
|
|
(42)
|
|
(13,369)
|
|
Deferred tax
valuation allowance and other discrete tax items
|
51
|
|
95
|
|
79
|
|
203
|
|
Unaudited adjusted
net income attributable to ARC Document Solutions, Inc.
|
$
|
3,711
|
|
$
|
4,810
|
|
$
|
5,563
|
|
$
|
7,521
|
|
|
|
|
|
|
Actual:
|
|
|
|
|
Earnings (loss) per
share attributable to ARC Document Solutions, Inc.
shareholders:
|
|
|
|
|
Basic
|
$
|
0.08
|
|
$
|
(1.22)
|
|
$
|
0.12
|
|
$
|
(1.15)
|
|
Diluted
|
$
|
0.08
|
|
$
|
(1.22)
|
|
$
|
0.12
|
|
$
|
(1.15)
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
Basic
|
45,792
|
|
45,955
|
|
45,716
|
|
46,285
|
|
Diluted
|
46,258
|
|
45,955
|
|
46,329
|
|
46,285
|
|
|
|
|
|
|
Adjusted:
|
|
|
|
|
Earnings per
share attributable to ARC Document Solutions, Inc.
shareholders:
|
|
|
|
|
Basic
|
$
|
0.08
|
|
$
|
0.10
|
|
$
|
0.12
|
|
$
|
0.16
|
|
Diluted
|
$
|
0.08
|
|
$
|
0.10
|
|
$
|
0.12
|
|
$
|
0.16
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
Basic
|
45,792
|
|
45,955
|
|
45,716
|
|
46,285
|
|
Diluted
|
46,258
|
|
46,568
|
|
46,329
|
|
46,889
|
|
ARC Document Solutions, Inc.
|
Non-GAAP
Measures
|
Reconciliation of
net income (loss) attributable to ARC Document Solutions, Inc. to
EBITDA and Adjusted EBITDA
|
(In
thousands)
|
(Unaudited)
|
|
Three Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
|
2017
|
2016
|
2017
|
2016
|
Net income (loss)
attributable to ARC Document Solutions, Inc.
|
$
|
3,636
|
|
$
|
(55,904)
|
|
$
|
5,420
|
|
$
|
(53,330)
|
|
Interest expense,
net
|
1,594
|
|
1,526
|
|
3,149
|
|
2,972
|
|
Income tax provision
(benefit)
|
2,522
|
|
(10,015)
|
|
3,748
|
|
(8,046)
|
|
Depreciation and
amortization
|
8,353
|
|
7,890
|
|
16,607
|
|
15,880
|
|
EBITDA
|
16,105
|
|
(56,503)
|
|
28,924
|
|
(42,524)
|
|
Loss on
extinguishment of debt
|
40
|
|
44
|
|
106
|
|
90
|
|
Goodwill
impairment
|
—
|
|
73,920
|
|
—
|
|
73,920
|
|
Restructuring
expense
|
—
|
|
5
|
|
—
|
|
7
|
|
Stock-based
compensation
|
816
|
|
651
|
|
1,553
|
|
1,423
|
|
Adjusted
EBITDA
|
$
|
16,961
|
|
$
|
18,117
|
|
$
|
30,583
|
|
$
|
32,916
|
|
|
|
ARC Document
Solutions, Inc.
|
Net Sales by
Product Line
|
(In
thousands)
|
(Unaudited)
|
|
Three Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
|
2017
|
2016
|
2017
|
2016
|
Service
sales
|
|
|
|
|
CDIM
|
$
|
53,684
|
|
$
|
54,860
|
|
$
|
104,942
|
|
$
|
108,525
|
|
MPS
|
33,050
|
|
34,055
|
|
65,544
|
|
67,286
|
|
AIM
|
3,136
|
|
3,666
|
|
6,348
|
|
7,405
|
|
Total service
sales
|
89,870
|
|
92,581
|
|
176,834
|
|
183,216
|
|
Equipment and
supplies sales
|
12,410
|
|
11,189
|
|
24,177
|
|
24,104
|
|
Total net
sales
|
$
|
102,280
|
|
$
|
103,770
|
|
$
|
201,011
|
|
$
|
207,320
|
|
Non-GAAP Financial Measures
EBITDA and related ratios presented in this report are
supplemental measures of our performance that are not required by
or presented in accordance with accounting principles generally
accepted in the United States of
America ("GAAP"). These measures are not measurements of our
financial performance under GAAP and should not be considered as
alternatives to net income, income from operations, or any other
performance measures derived in accordance with GAAP or as an
alternative to cash flows from operating, investing or financing
activities as a measure of our liquidity.
EBITDA represents net income before interest, taxes,
depreciation and amortization. EBITDA margin is a non-GAAP measure
calculated by dividing EBITDA by net sales.
We have presented EBITDA and related ratios because we consider
them important supplemental measures of our performance and
liquidity. We believe investors may also find these measures
meaningful, given how our management makes use of them. The
following is a discussion of our use of these measures.
We use EBITDA to measure and compare the performance of our
operating segments. Our operating segments' financial performance
includes all of the operating activities except debt and taxation
which are managed at the corporate level for U.S. operating
segments. We use EBITDA to compare the performance of our operating
segments and to measure performance for determining
consolidated-level compensation. In addition, we use EBITDA to
evaluate potential acquisitions and potential capital
expenditures.
EBITDA and related ratios have limitations as analytical tools,
and should not be considered in isolation, or as a substitute for
analysis of our results as reported under GAAP. Some of these
limitations are as follows:
- They do not reflect our cash expenditures, or future
requirements for capital expenditures and contractual
commitments;
- They do not reflect changes in, or cash requirements for, our
working capital needs;
- They do not reflect the significant interest expense, or the
cash requirements necessary, to service interest or principal
payments on our debt;
- Although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will often have to be
replaced in the future, and EBITDA does not reflect any cash
requirements for such replacements; and
- Other companies, including companies in our industry, may
calculate these measures differently than we do, limiting their
usefulness as comparative measures.
Because of these limitations, EBITDA and related ratios should
not be considered as measures of discretionary cash available to us
to invest in business growth or to reduce our indebtedness. We
compensate for these limitations by relying primarily on our GAAP
results and using EBITDA and related ratios only as
supplements.
Our presentation of adjusted net income and adjusted EBITDA over
certain periods is an attempt to provide meaningful comparisons to
our historical performance for our existing and future investors.
The unprecedented changes in our end markets over the past several
years have required us to take measures that are unique in our
history and specific to individual circumstances. Comparisons
inclusive of these actions make normal financial and other
performance patterns difficult to discern under a strict GAAP
presentation. Each non-GAAP presentation, however, is explained in
detail in the reconciliation tables above.
Specifically, we have presented adjusted net income attributable
to ARC and adjusted earnings per share attributable to ARC
shareholders for the three and six months ended June 30, 2017
and 2016 to reflect the exclusion of loss on extinguishment of
debt, goodwill impairment, restructuring expense, and changes in
the valuation allowances related to certain deferred tax assets and
other discrete tax items. This presentation facilitates a
meaningful comparison of our operating results for the three and
six months ended June 30, 2017 and 2016. We believe these
charges were the result of the then current macroeconomic
environment, our capital restructuring, or other items which are
not indicative of our actual operating performance.
We have presented adjusted EBITDA for the three and six months
ended June 30, 2017 and 2016 to exclude loss on extinguishment
of debt, goodwill impairment, restructuring expense and stock-based
compensation expense. The adjustment of EBITDA for these items is
consistent with the definition of adjusted EBITDA in our credit
agreement; therefore, we believe this information is useful to
investors in assessing our financial performance.
ARC Document
Solutions, Inc.
|
Consolidated
Statements of Cash Flows
|
(In
thousands)
|
(Unaudited)
|
|
Three Months
Ended
|
Six Months
Ended
|
|
June
30,
|
June
30,
|
|
2017
|
2016
|
2017
|
2016
|
Cash flows from
operating activities
|
|
|
|
|
Net income
(loss)
|
$
|
3,720
|
|
$
|
(55,808)
|
|
$
|
5,468
|
|
$
|
(53,180)
|
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
|
Allowance for
accounts receivable
|
353
|
|
249
|
|
561
|
|
320
|
|
Depreciation
|
7,271
|
|
6,658
|
|
14,410
|
|
13,335
|
|
Amortization of
intangible assets
|
1,082
|
|
1,232
|
|
2,197
|
|
2,545
|
|
Amortization of
deferred financing costs
|
83
|
|
115
|
|
177
|
|
233
|
|
Goodwill
impairment
|
—
|
|
73,920
|
|
—
|
|
73,920
|
|
Stock-based
compensation
|
816
|
|
651
|
|
1,553
|
|
1,423
|
|
Deferred income
taxes
|
2,248
|
|
(10,066)
|
|
3,425
|
|
(8,317)
|
|
Deferred tax
valuation allowance
|
45
|
|
(87)
|
|
34
|
|
(15)
|
|
Loss on early
extinguishment of debt
|
40
|
|
44
|
|
106
|
|
90
|
|
Other non-cash items,
net
|
(163)
|
|
(119)
|
|
(136)
|
|
(453)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
(95)
|
|
(124)
|
|
(148)
|
|
(1,388)
|
|
Inventory
|
1,026
|
|
(1,199)
|
|
(508)
|
|
(2,767)
|
|
Prepaid expenses and
other assets
|
(1,956)
|
|
(1,063)
|
|
(2,158)
|
|
(666)
|
|
Accounts payable and
accrued expenses
|
4,018
|
|
2,177
|
|
449
|
|
(3,197)
|
|
Net cash provided by
operating activities
|
18,488
|
|
16,580
|
|
25,430
|
|
21,883
|
|
Cash flows from
investing activities
|
|
|
|
|
Capital
expenditures
|
(2,899)
|
|
(2,645)
|
|
(4,911)
|
|
(5,150)
|
|
Other
|
262
|
|
481
|
|
394
|
|
707
|
|
Net cash used in
investing activities
|
(2,637)
|
|
(2,164)
|
|
(4,517)
|
|
(4,443)
|
|
Cash flows from
financing activities
|
|
|
|
|
Proceeds from stock
option exercises
|
3
|
|
19
|
|
71
|
|
30
|
|
Proceeds from
issuance of common stock under Employee Stock Purchase
Plan
|
30
|
|
31
|
|
66
|
|
70
|
|
Share
repurchases
|
—
|
|
(2,364)
|
|
—
|
|
(5,097)
|
|
Contingent
consideration on prior acquisitions
|
(81)
|
|
(302)
|
|
(151)
|
|
(367)
|
|
Early extinguishment
of long-term debt
|
(5,650)
|
|
(4,600)
|
|
(14,150)
|
|
(9,000)
|
|
Payments on long-term
debt agreements and capital leases
|
(4,106)
|
|
(3,220)
|
|
(7,914)
|
|
(6,341)
|
|
Borrowings under
revolving credit facilities
|
1,000
|
|
—
|
|
2,500
|
|
—
|
|
Payments under
revolving credit facilities
|
(175)
|
|
—
|
|
(300)
|
|
—
|
|
Payment of deferred
financing costs
|
—
|
|
—
|
|
—
|
|
(30)
|
|
Net cash used in
financing activities
|
(8,979)
|
|
(10,436)
|
|
(19,878)
|
|
(20,735)
|
|
Effect of foreign
currency translation on cash balances
|
63
|
|
(321)
|
|
330
|
|
(216)
|
|
Net change in cash
and cash equivalents
|
6,935
|
|
3,659
|
|
1,365
|
|
(3,511)
|
|
Cash and cash
equivalents at beginning of period
|
19,669
|
|
16,793
|
|
25,239
|
|
23,963
|
|
Cash and cash
equivalents at end of period
|
$
|
26,604
|
|
$
|
20,452
|
|
$
|
26,604
|
|
$
|
20,452
|
|
Supplemental
disclosure of cash flow information
|
|
|
|
|
Noncash investing
and financing activities
|
|
|
|
|
Capital lease
obligations incurred
|
$
|
6,390
|
|
$
|
5,742
|
|
$
|
14,310
|
|
$
|
8,607
|
|
Contingent
liabilities in connection with acquisition of businesses
|
$
|
27
|
|
$
|
—
|
|
$
|
27
|
|
$
|
89
|
|
Liabilities in
connection with deferred financing fees
|
$
|
—
|
|
$
|
76
|
|
$
|
—
|
|
$
|
76
|
|
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SOURCE ARC Document Solutions, Inc.