Delaware
|
|
52-0845774
|
(State of Incorporation)
|
|
(I.R.S. Employer Identification No.)
|
70 Corporate Center
|
|
|
11000 Broken Land Parkway, Suite 200, Columbia, MD
|
|
21044
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
|
¨
|
Accelerated filer
|
x
|
Non-accelerated filer
¨
|
Smaller reporting company
|
¨
|
Emerging growth company
|
¨
|
|
Class
|
|
Outstanding
|
|
Common Stock, par value $.01 per share
|
|
16,565,164
|
|
|
|
Page
|
|
|
|
Part I.
|
Financial Information
|
|
|
|
|
Item 1.
|
Financial Statements (Unaudited)
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
Part II.
|
||
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 6.
|
||
|
|
|
|
September 30, 2018 (Unaudited)
|
|
December 31, 2017
|
||||
Assets
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash
|
$
|
10,323
|
|
|
$
|
23,612
|
|
Accounts and other receivables, less allowance for doubtful accounts of $2,190 in 2018 and $2,492 in 2017
|
127,649
|
|
|
119,335
|
|
||
Unbilled revenue
|
36,866
|
|
|
42,958
|
|
||
Prepaid expenses and other current assets
|
18,452
|
|
|
14,212
|
|
||
Total current assets
|
193,290
|
|
|
200,117
|
|
||
Property, plant and equipment
|
20,909
|
|
|
21,466
|
|
||
Accumulated depreciation
|
(15,310
|
)
|
|
(16,343
|
)
|
||
Property, plant and equipment, net
|
5,599
|
|
|
5,123
|
|
||
Goodwill
|
174,975
|
|
|
144,835
|
|
||
Intangible assets, net
|
17,463
|
|
|
8,363
|
|
||
Other assets
|
10,170
|
|
|
6,569
|
|
||
|
$
|
401,497
|
|
|
$
|
365,007
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Short-term borrowings
|
$
|
69,044
|
|
|
$
|
37,696
|
|
Current portion of long-term debt
|
12,000
|
|
|
12,000
|
|
||
Accounts payable and accrued expenses
|
71,422
|
|
|
78,280
|
|
||
Deferred revenue
|
23,499
|
|
|
22,356
|
|
||
Total current liabilities
|
175,965
|
|
|
150,332
|
|
||
Long-term debt
|
25,000
|
|
|
16,000
|
|
||
Other noncurrent liabilities
|
11,334
|
|
|
10,621
|
|
||
Total liabilities
|
212,299
|
|
|
176,953
|
|
||
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
|
|
||
Common stock, par value $0.01 per share
|
172
|
|
|
172
|
|
||
Additional paid-in capital
|
107,300
|
|
|
107,256
|
|
||
Retained earnings
|
115,654
|
|
|
106,599
|
|
||
Treasury stock at cost
|
(15,710
|
)
|
|
(11,118
|
)
|
||
Accumulated other comprehensive loss
|
(18,218
|
)
|
|
(14,855
|
)
|
||
Total stockholders’ equity
|
189,198
|
|
|
188,054
|
|
||
|
$
|
401,497
|
|
|
$
|
365,007
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue
|
$
|
123,566
|
|
|
$
|
124,097
|
|
|
$
|
382,289
|
|
|
$
|
377,705
|
|
Cost of revenue
|
104,367
|
|
|
105,451
|
|
|
322,838
|
|
|
317,236
|
|
||||
Gross profit
|
19,199
|
|
|
18,646
|
|
|
59,451
|
|
|
60,469
|
|
||||
General and administrative expenses
|
12,227
|
|
|
14,160
|
|
|
40,207
|
|
|
39,536
|
|
||||
Sales and marketing expenses
|
1,297
|
|
|
393
|
|
|
3,128
|
|
|
1,249
|
|
||||
Restructuring charges
|
—
|
|
|
—
|
|
|
2,930
|
|
|
—
|
|
||||
Gain on change in fair value of contingent consideration, net
|
526
|
|
|
268
|
|
|
3,972
|
|
|
369
|
|
||||
Operating income
|
6,201
|
|
|
4,361
|
|
|
17,158
|
|
|
20,053
|
|
||||
Interest expense
|
1,095
|
|
|
511
|
|
|
1,631
|
|
|
1,483
|
|
||||
Other (expense) income
|
(760
|
)
|
|
74
|
|
|
(1,912
|
)
|
|
(108
|
)
|
||||
Income before income tax expense
|
4,346
|
|
|
3,924
|
|
|
13,615
|
|
|
18,462
|
|
||||
Income tax expense
|
1,102
|
|
|
643
|
|
|
4,164
|
|
|
5,232
|
|
||||
Net income
|
$
|
3,244
|
|
|
$
|
3,281
|
|
|
$
|
9,451
|
|
|
$
|
13,230
|
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
16,536
|
|
|
16,750
|
|
|
16,555
|
|
|
16,736
|
|
||||
Diluted weighted average shares outstanding
|
16,628
|
|
|
16,896
|
|
|
16,647
|
|
|
16,856
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Per common share data:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per share
|
$
|
0.20
|
|
|
$
|
0.20
|
|
|
$
|
0.57
|
|
|
$
|
0.79
|
|
Diluted earnings per share
|
$
|
0.20
|
|
|
$
|
0.19
|
|
|
$
|
0.57
|
|
|
$
|
0.78
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income
|
$
|
3,244
|
|
|
$
|
3,281
|
|
|
$
|
9,451
|
|
|
$
|
13,230
|
|
Foreign currency translation adjustments
|
(457
|
)
|
|
2,575
|
|
|
(3,662
|
)
|
|
7,051
|
|
||||
Change in fair value of interest rate cap, net of tax
|
47
|
|
|
(28
|
)
|
|
252
|
|
|
(137
|
)
|
||||
Change in fair value of interest rate swap, net of tax
|
(12
|
)
|
|
21
|
|
|
$
|
47
|
|
|
$
|
(2
|
)
|
||
Comprehensive income
|
$
|
2,822
|
|
|
$
|
5,849
|
|
|
$
|
6,088
|
|
|
$
|
20,142
|
|
|
2018
|
|
2017
|
||||
Cash flows from operating activities:
|
|
|
|
|
|
||
Net income
|
$
|
9,451
|
|
|
$
|
13,230
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||
Gain on change in fair value of contingent consideration, net
|
(3,972
|
)
|
|
(369
|
)
|
||
Depreciation and amortization
|
5,670
|
|
|
5,153
|
|
||
Deferred income taxes
|
(610
|
)
|
|
(421
|
)
|
||
Non-cash compensation expense
|
3,501
|
|
|
4,876
|
|
||
Changes in other operating items:
|
|
|
|
|
|
||
Accounts and other receivables
|
(4,644
|
)
|
|
11,805
|
|
||
Unbilled revenue
|
6,344
|
|
|
(11,670
|
)
|
||
Prepaid expenses and other current assets
|
(5,131
|
)
|
|
(6,232
|
)
|
||
Accounts payable and accrued expenses
|
(5,527
|
)
|
|
8,145
|
|
||
Deferred revenue
|
(2,215
|
)
|
|
(3,203
|
)
|
||
Other
|
643
|
|
|
(140
|
)
|
||
Net cash provided by operating activities
|
3,510
|
|
|
21,174
|
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
|
||
Additions to property, plant and equipment
|
(2,267
|
)
|
|
(2,324
|
)
|
||
Acquisitions, net of cash acquired
|
(42,872
|
)
|
|
(11,112
|
)
|
||
Other investing activities
|
(3,229
|
)
|
|
(981
|
)
|
||
Net cash used in investing activities
|
(48,368
|
)
|
|
(14,417
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
||
Proceeds from short-term borrowings
|
31,410
|
|
|
9,749
|
|
||
Proceeds from long-term debt
|
18,000
|
|
|
—
|
|
||
Repayment of long-term debt
|
(9,000
|
)
|
|
(9,000
|
)
|
||
Contingent consideration payments
|
—
|
|
|
(967
|
)
|
||
Change in negative cash book balance
|
723
|
|
|
(2,813
|
)
|
||
Tax withholding payments for employee stock-based compensation in exchange for shares surrendered
|
(103
|
)
|
|
(604
|
)
|
||
Repurchases of common stock in the open market
|
(8,485
|
)
|
|
(2,419
|
)
|
||
Premium paid for interest rate cap
|
—
|
|
|
(474
|
)
|
||
Other financing activities
|
(24
|
)
|
|
120
|
|
||
Net cash provided by (used in) financing activities
|
32,521
|
|
|
(6,408
|
)
|
||
|
|
|
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
(952
|
)
|
|
1,325
|
|
||
Net increase (decrease) in cash
|
(13,289
|
)
|
|
1,674
|
|
||
Cash at beginning of period
|
23,612
|
|
|
16,346
|
|
||
Cash at end of period
|
$
|
10,323
|
|
|
$
|
18,020
|
|
|
|
|
|
||||
Supplemental disclosures of cash flow information:
|
|
|
|
||||
Cash paid during the period for interest
|
$
|
2,465
|
|
|
$
|
1,381
|
|
Cash paid during the period for income taxes
|
3,320
|
|
|
4,874
|
|
||
Accrued contingent consideration
|
905
|
|
|
5,613
|
|
(1)
|
Basis of Presentation
|
(2)
|
Recent Accounting Standards
|
|
Balance at December 31, 2017
|
|
Adjustments due to ASC Topic 606
|
|
Balance at January 1, 2018
|
||||||
Assets:
|
|
|
|
|
|
|
|
||||
Prepaid expenses and other current assets
|
$
|
14,212
|
|
|
$
|
2,059
|
|
|
$
|
16,271
|
|
Other assets
|
6,569
|
|
|
132
|
|
|
6,701
|
|
|||
Liabilities and Stockholders’ Equity:
|
|
|
|
|
|
|
|
||||
Deferred revenue
|
22,356
|
|
|
2,587
|
|
|
24,943
|
|
|||
Retained earnings
|
106,599
|
|
|
(396
|
)
|
|
106,203
|
|
|
As reported
|
|
Balances without Adoption of Topic 606
|
|
Effect of Adoption - Higher (Lower)
|
||||||
Revenue
|
$
|
123,566
|
|
|
$
|
123,727
|
|
|
$
|
(161
|
)
|
Cost of revenue
|
104,367
|
|
|
104,732
|
|
|
(365
|
)
|
|||
Gross profit
|
19,199
|
|
|
18,995
|
|
|
204
|
|
|||
Income tax expense
|
1,102
|
|
|
1,051
|
|
|
51
|
|
|||
Net income
|
3,244
|
|
|
3,091
|
|
|
153
|
|
|||
|
|
|
|
|
|
||||||
Per common share data:
|
|
|
|
|
|
|
|
||||
Basic earnings per share
|
$
|
0.20
|
|
|
$
|
0.19
|
|
|
$
|
0.01
|
|
Diluted earnings per share
|
$
|
0.20
|
|
|
$
|
0.19
|
|
|
$
|
0.01
|
|
|
As reported
|
|
Balances without Adoption of Topic 606
|
|
Effect of Adoption - Higher (Lower)
|
||||||
Revenue
|
$
|
382,289
|
|
|
$
|
381,135
|
|
|
$
|
1,154
|
|
Cost of revenue
|
322,838
|
|
|
322,349
|
|
|
489
|
|
|||
Gross profit
|
59,451
|
|
|
58,786
|
|
|
665
|
|
|||
Income tax expense
|
4,164
|
|
|
3,992
|
|
|
172
|
|
|||
Net income
|
9,451
|
|
|
8,958
|
|
|
493
|
|
|||
|
|
|
|
|
|
||||||
Per common share data:
|
|
|
|
|
|
|
|
||||
Basic earnings per share
|
$
|
0.57
|
|
|
$
|
0.54
|
|
|
$
|
0.03
|
|
Diluted earnings per share
|
$
|
0.57
|
|
|
$
|
0.54
|
|
|
$
|
0.03
|
|
|
As reported
|
|
Balances without adoption of ASC Topic 606
|
|
Effect of Adoption - Higher (Lower)
|
||||||
Assets:
|
|
|
|
|
|
|
|
||||
Prepaid expenses and other current assets
|
$
|
18,452
|
|
|
$
|
16,816
|
|
|
$
|
1,636
|
|
Other assets
|
10,170
|
|
|
10,210
|
|
|
(40
|
)
|
|||
Total assets
|
401,497
|
|
|
399,901
|
|
|
1,596
|
|
|||
Liabilities and Stockholders’ Equity:
|
|
|
|
|
|
|
|
||||
Accounts payable and accrued expenses
|
71,422
|
|
|
70,933
|
|
|
489
|
|
|||
Deferred revenue
|
23,499
|
|
|
22,489
|
|
|
1,010
|
|
|||
Retained earnings
|
115,654
|
|
|
115,557
|
|
|
97
|
|
|||
Total liabilities and stockholders' equity
|
401,497
|
|
|
399,901
|
|
|
1,596
|
|
(3)
|
Revenue
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||
|
Workforce
Excellence
|
|
Business Transformation Services
|
|
Consolidated
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||
Revenue by type of service:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Managed learning services
|
$
|
51,387
|
|
|
$
|
52,524
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
51,387
|
|
|
$
|
52,524
|
|
Engineering & technical services
|
29,129
|
|
|
24,498
|
|
|
—
|
|
|
—
|
|
|
29,129
|
|
|
24,498
|
|
||||||
Sales enablement
|
—
|
|
|
—
|
|
|
19,944
|
|
|
22,768
|
|
|
19,944
|
|
|
22,768
|
|
||||||
Organizational development
|
—
|
|
|
—
|
|
|
23,106
|
|
|
24,307
|
|
|
23,106
|
|
|
24,307
|
|
||||||
|
$
|
80,516
|
|
|
$
|
77,022
|
|
|
$
|
43,050
|
|
|
$
|
47,075
|
|
|
$
|
123,566
|
|
|
$
|
124,097
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue by geographic region:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Americas
|
$
|
56,064
|
|
|
$
|
48,382
|
|
|
$
|
35,380
|
|
|
$
|
40,641
|
|
|
$
|
91,444
|
|
|
$
|
89,023
|
|
Europe Middle East Africa
|
21,153
|
|
|
25,540
|
|
|
8,906
|
|
|
7,183
|
|
|
30,059
|
|
|
32,723
|
|
||||||
Asia Pacific
|
8,205
|
|
|
8,255
|
|
|
109
|
|
|
76
|
|
|
8,314
|
|
|
8,331
|
|
||||||
Eliminations
|
(4,906
|
)
|
|
(5,155
|
)
|
|
(1,345
|
)
|
|
(825
|
)
|
|
(6,251
|
)
|
|
(5,980
|
)
|
||||||
|
$
|
80,516
|
|
|
$
|
77,022
|
|
|
$
|
43,050
|
|
|
$
|
47,075
|
|
|
$
|
123,566
|
|
|
$
|
124,097
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue by client market sector:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Automotive
|
$
|
2,738
|
|
|
$
|
2,399
|
|
|
$
|
20,531
|
|
|
$
|
22,777
|
|
|
$
|
23,269
|
|
|
$
|
25,176
|
|
Financial & Insurance
|
22,364
|
|
|
23,583
|
|
|
2,692
|
|
|
3,929
|
|
|
25,056
|
|
|
27,512
|
|
||||||
Manufacturing
|
7,558
|
|
|
8,874
|
|
|
3,734
|
|
|
3,428
|
|
|
11,292
|
|
|
12,302
|
|
||||||
Energy / Oil & Gas
|
9,113
|
|
|
8,457
|
|
|
1,188
|
|
|
465
|
|
|
10,301
|
|
|
8,922
|
|
||||||
U.S. Government
|
7,673
|
|
|
6,220
|
|
|
2,102
|
|
|
2,352
|
|
|
9,775
|
|
|
8,572
|
|
||||||
U.K. Government
|
4,456
|
|
|
6,858
|
|
|
—
|
|
|
—
|
|
|
4,456
|
|
|
6,858
|
|
||||||
Information & Communication
|
3,315
|
|
|
3,785
|
|
|
2,330
|
|
|
2,509
|
|
|
5,645
|
|
|
6,294
|
|
||||||
Aerospace
|
6,705
|
|
|
5,582
|
|
|
1,160
|
|
|
1,678
|
|
|
7,865
|
|
|
7,260
|
|
||||||
Electronics Semiconductor
|
3,719
|
|
|
4,016
|
|
|
241
|
|
|
150
|
|
|
3,960
|
|
|
4,166
|
|
||||||
Life Sciences
|
4,892
|
|
|
1,822
|
|
|
1,932
|
|
|
2,273
|
|
|
6,824
|
|
|
4,095
|
|
||||||
Other
|
7,983
|
|
|
5,426
|
|
|
7,140
|
|
|
7,514
|
|
|
15,123
|
|
|
12,940
|
|
||||||
|
$
|
80,516
|
|
|
$
|
77,022
|
|
|
$
|
43,050
|
|
|
$
|
47,075
|
|
|
$
|
123,566
|
|
|
$
|
124,097
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
Workforce
Excellence
|
|
Business Transformation Services
|
|
Consolidated
|
||||||||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||
Revenue by type of service:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Managed learning services
|
$
|
156,244
|
|
|
$
|
152,713
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
156,244
|
|
|
$
|
152,713
|
|
Engineering & technical services
|
82,800
|
|
|
75,523
|
|
|
—
|
|
|
—
|
|
|
82,800
|
|
|
75,523
|
|
||||||
Sales enablement
|
—
|
|
|
—
|
|
|
73,566
|
|
|
75,756
|
|
|
73,566
|
|
|
75,756
|
|
||||||
Organizational development
|
—
|
|
|
—
|
|
|
69,679
|
|
|
73,713
|
|
|
69,679
|
|
|
73,713
|
|
||||||
|
$
|
239,044
|
|
|
$
|
228,236
|
|
|
$
|
143,245
|
|
|
$
|
149,469
|
|
|
$
|
382,289
|
|
|
$
|
377,705
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue by geographic region:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Americas
|
$
|
158,935
|
|
|
$
|
147,423
|
|
|
$
|
120,814
|
|
|
$
|
131,567
|
|
|
$
|
279,749
|
|
|
$
|
278,990
|
|
Europe Middle East Africa
|
69,248
|
|
|
73,078
|
|
|
27,408
|
|
|
20,854
|
|
|
96,656
|
|
|
93,932
|
|
||||||
Asia Pacific
|
24,405
|
|
|
22,328
|
|
|
298
|
|
|
332
|
|
|
24,703
|
|
|
22,660
|
|
||||||
Eliminations
|
(13,544
|
)
|
|
(14,593
|
)
|
|
(5,275
|
)
|
|
(3,284
|
)
|
|
(18,819
|
)
|
|
(17,877
|
)
|
||||||
|
$
|
239,044
|
|
|
$
|
228,236
|
|
|
$
|
143,245
|
|
|
$
|
149,469
|
|
|
$
|
382,289
|
|
|
$
|
377,705
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue by client market sector:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Automotive
|
$
|
8,614
|
|
|
$
|
7,175
|
|
|
$
|
73,134
|
|
|
$
|
75,967
|
|
|
$
|
81,748
|
|
|
$
|
83,142
|
|
Financial & Insurance
|
67,522
|
|
|
64,066
|
|
|
9,010
|
|
|
12,438
|
|
|
76,532
|
|
|
76,504
|
|
||||||
Manufacturing
|
25,621
|
|
|
26,762
|
|
|
11,606
|
|
|
11,970
|
|
|
37,227
|
|
|
38,732
|
|
||||||
Energy / Oil & Gas
|
27,769
|
|
|
26,275
|
|
|
3,318
|
|
|
1,896
|
|
|
31,087
|
|
|
28,171
|
|
||||||
U.S. Government
|
20,704
|
|
|
18,528
|
|
|
6,742
|
|
|
6,910
|
|
|
27,446
|
|
|
25,438
|
|
||||||
U.K. Government
|
14,889
|
|
|
21,789
|
|
|
—
|
|
|
—
|
|
|
14,889
|
|
|
21,789
|
|
||||||
Information & Communication
|
11,027
|
|
|
12,785
|
|
|
6,953
|
|
|
7,948
|
|
|
17,980
|
|
|
20,733
|
|
||||||
Aerospace
|
21,619
|
|
|
16,003
|
|
|
2,408
|
|
|
4,774
|
|
|
24,027
|
|
|
20,777
|
|
||||||
Electronics Semiconductor
|
11,228
|
|
|
12,371
|
|
|
521
|
|
|
610
|
|
|
11,749
|
|
|
12,981
|
|
||||||
Life Sciences
|
9,743
|
|
|
5,912
|
|
|
7,143
|
|
|
7,171
|
|
|
16,886
|
|
|
13,083
|
|
||||||
Other
|
20,308
|
|
|
16,570
|
|
|
22,410
|
|
|
19,785
|
|
|
42,718
|
|
|
36,355
|
|
||||||
|
$
|
239,044
|
|
|
$
|
228,236
|
|
|
$
|
143,245
|
|
|
$
|
149,469
|
|
|
$
|
382,289
|
|
|
$
|
377,705
|
|
(4)
|
Significant Customers & Concentration of Credit Risk
|
(5)
|
Earnings Per Share
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||||||
Non-dilutive instruments
|
108
|
|
|
—
|
|
|
85
|
|
|
17
|
|
|
|
|
|
|
|
|
|
||||
Dilutive common stock equivalents
|
92
|
|
|
146
|
|
|
92
|
|
|
120
|
|
(6)
|
Acquisitions
|
|
|
|
|
Amortization
|
||
Purchase price allocation:
|
|
|
|
|
Period
|
|
Cash
|
|
$
|
125
|
|
|
|
Accounts receivable and other current assets
|
|
3,651
|
|
|
|
|
Fixed assets
|
|
9
|
|
|
|
|
Customer-related intangible assets
|
|
600
|
|
|
5 years
|
|
Goodwill
|
|
1,944
|
|
|
|
|
Total assets
|
|
6,329
|
|
|
|
|
|
|
|
|
|
||
Accounts payable and accrued expenses
|
|
$
|
3,130
|
|
|
|
Deferred revenue
|
|
126
|
|
|
|
|
Deferred tax liability
|
|
73
|
|
|
|
|
Total liabilities
|
|
3,329
|
|
|
|
|
|
|
|
|
|
||
Net assets acquired
|
|
$
|
3,000
|
|
|
|
Cash purchase price
|
|
$
|
30,535
|
|
|
|
Fair value of contingent consideration
|
|
905
|
|
|
|
|
Total purchase price
|
|
$
|
31,440
|
|
|
|
|
|
|
|
Amortization
|
||
Purchase price allocation:
|
|
|
|
|
Period
|
|
Cash
|
|
$
|
538
|
|
|
|
Accounts receivable and other current assets
|
|
3,072
|
|
|
|
|
Fixed assets
|
|
368
|
|
|
|
|
Customer-related intangible assets
|
|
10,365
|
|
|
8 years
|
|
Marketing-related intangible assets
|
|
239
|
|
|
3 years
|
|
Goodwill
|
|
21,657
|
|
|
|
|
Total assets
|
|
36,239
|
|
|
|
|
|
|
|
|
|
||
Accounts payable and accrued expenses
|
|
989
|
|
|
|
|
Deferred revenue
|
|
979
|
|
|
|
|
Deferred tax liability
|
|
2,831
|
|
|
|
|
Total liabilities
|
|
4,799
|
|
|
|
|
|
|
|
|
|
||
Net assets acquired
|
|
$
|
31,440
|
|
|
|
|
|
|
|
Amortization
|
||
Purchase price allocation:
|
|
|
|
|
Period
|
|
Customer-related intangible assets
|
|
$
|
1,367
|
|
|
4 years
|
Marketing-related intangible assets
|
|
106
|
|
|
2 years
|
|
Goodwill
|
|
8,527
|
|
|
|
|
Total assets
|
|
$
|
10,000
|
|
|
|
|
|
|
|
|
Acquisition:
|
Original range of potential undiscounted payments
|
|
As of September 30, 2018 Maximum contingent consideration due in
|
|||||||||||
|
|
|
2018
|
2019
|
2020
|
Total
|
||||||||
IC Axon
|
$0 - $3,500
|
|
$
|
—
|
|
$
|
3,500
|
|
$
|
—
|
|
$
|
3,500
|
|
McKinney Rogers
|
$0 - $18,000
|
|
—
|
|
4,000
|
|
4,000
|
|
8,000
|
|
||||
|
|
|
$
|
—
|
|
$
|
7,500
|
|
$
|
4,000
|
|
$
|
11,500
|
|
|
|
|
|
|
|
|
|
Liability as of
December 31,
|
|
|
|
|
|
Change in
Fair Value of
Contingent
|
|
Foreign
Currency
|
|
Liability as of
September 30,
|
||||||||||||
Acquisition:
|
2017
|
|
Additions
|
|
Payments
|
|
Consideration
|
|
Translation
|
|
2018
|
||||||||||||
IC Axon
|
$
|
—
|
|
|
$
|
905
|
|
|
$
|
—
|
|
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
950
|
|
Maverick
|
1,979
|
|
|
—
|
|
|
—
|
|
|
(1,979
|
)
|
|
—
|
|
|
—
|
|
||||||
McKinney Rogers
|
1,501
|
|
|
—
|
|
|
—
|
|
|
(1,308
|
)
|
|
—
|
|
|
193
|
|
||||||
Emantras
|
76
|
|
|
—
|
|
|
—
|
|
|
(76
|
)
|
|
—
|
|
|
—
|
|
||||||
CLS
|
669
|
|
|
—
|
|
|
—
|
|
|
(654
|
)
|
|
(15
|
)
|
|
—
|
|
||||||
Total
|
$
|
4,225
|
|
|
$
|
905
|
|
|
$
|
—
|
|
|
$
|
(3,972
|
)
|
|
$
|
(15
|
)
|
|
$
|
1,143
|
|
(7)
|
Intangible Assets
|
|
Workforce Excellence
|
|
Business Transformation Services
|
|
Total
|
||||||
Balance as of December 31, 2017
|
$
|
105,764
|
|
|
$
|
39,071
|
|
|
$
|
144,835
|
|
Acquisitions
|
21,657
|
|
|
10,471
|
|
|
32,128
|
|
|||
Foreign currency translation
|
(1,476
|
)
|
|
(512
|
)
|
|
(1,988
|
)
|
|||
Balance as of September 30, 2018
|
$
|
125,945
|
|
|
$
|
49,030
|
|
|
$
|
174,975
|
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||
September 30, 2018
|
|
|
|||||||||
Customer relationships
|
$
|
22,558
|
|
|
$
|
(7,717
|
)
|
|
$
|
14,841
|
|
Intellectual property and other
|
4,301
|
|
|
(1,679
|
)
|
|
2,622
|
|
|||
|
$
|
26,859
|
|
|
$
|
(9,396
|
)
|
|
$
|
17,463
|
|
|
|
|
|
|
|
||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|||
Customer relationships
|
$
|
16,330
|
|
|
$
|
(11,140
|
)
|
|
$
|
5,190
|
|
Intellectual property and other
|
4,298
|
|
|
(1,125
|
)
|
|
3,173
|
|
|||
|
$
|
20,628
|
|
|
$
|
(12,265
|
)
|
|
$
|
8,363
|
|
(8)
|
Stock-Based Compensation
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Non-qualified stock options
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
6
|
|
Restricted stock units
|
196
|
|
|
891
|
|
|
1,173
|
|
|
2,569
|
|
||||
Board of Directors stock grants
|
51
|
|
|
93
|
|
|
171
|
|
|
248
|
|
||||
Total stock-based compensation expense
|
$
|
247
|
|
|
$
|
985
|
|
|
$
|
1,344
|
|
|
$
|
2,823
|
|
(9)
|
Debt and Financial Instruments
|
(10)
|
Income Taxes
|
(11)
|
Stockholders’ Equity
|
|
Common
stock
|
|
Additional
paid-in
capital
|
|
Retained
earnings
|
|
Treasury
stock
at cost
|
|
Accumulated
other
comprehensive
loss
|
|
Total
stockholders’
equity
|
||||||||||||
Balance at December 31, 2017
|
$
|
172
|
|
|
$
|
107,256
|
|
|
$
|
106,599
|
|
|
$
|
(11,118
|
)
|
|
$
|
(14,855
|
)
|
|
$
|
188,054
|
|
Cumulative effect adjustment of adopting ASU 2014-09
|
—
|
|
|
—
|
|
|
(396
|
)
|
|
—
|
|
|
—
|
|
|
(396
|
)
|
||||||
Adjusted balance at December 31, 2017
|
172
|
|
|
107,256
|
|
|
106,203
|
|
|
(11,118
|
)
|
|
(14,855
|
)
|
|
187,658
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
9,451
|
|
|
—
|
|
|
—
|
|
|
9,451
|
|
||||||
Foreign currency translation adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,662
|
)
|
|
(3,662
|
)
|
||||||
Change in fair value of interest rate cap, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
252
|
|
|
252
|
|
||||||
Change in fair value of interest rate swap, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|
47
|
|
||||||
Repurchases of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,956
|
)
|
|
—
|
|
|
(7,956
|
)
|
||||||
Stock-based compensation expense
|
—
|
|
|
1,344
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,344
|
|
||||||
Issuance of stock for employer contributions to retirement plan
|
—
|
|
|
(298
|
)
|
|
—
|
|
|
2,455
|
|
|
—
|
|
|
2,157
|
|
||||||
Net issuances of stock pursuant to stock compensation plans and other
|
—
|
|
|
(1,002
|
)
|
|
—
|
|
|
909
|
|
|
—
|
|
|
(93
|
)
|
||||||
Balance at September 30, 2018
|
$
|
172
|
|
|
$
|
107,300
|
|
|
$
|
115,654
|
|
|
$
|
(15,710
|
)
|
|
$
|
(18,218
|
)
|
|
$
|
189,198
|
|
(12)
|
Restructuring
|
|
|
Employee Severance and Related Benefits
|
|
Excess Facilities and Other Costs
|
|
Total
|
||||||
Liability as of December 31, 2017
|
|
$
|
2,840
|
|
|
$
|
—
|
|
|
$
|
2,840
|
|
Additional restructuring charges
|
|
1,678
|
|
|
1,252
|
|
|
2,930
|
|
|||
Payments
|
|
(2,791
|
)
|
|
(360
|
)
|
|
(3,151
|
)
|
|||
Liability as of September 30, 2018
|
|
$
|
1,727
|
|
|
$
|
892
|
|
|
$
|
2,619
|
|
(13)
|
Business Segments
|
•
|
Managed Learning Services
- this practice focuses on creating value for our customers by delivering a suite of talent management and learning design, development, operational and support services that can be delivered as large scale outsourcing arrangements, managed services contracts and project-based service engagements. The Managed Learning Services offerings include strategic learning and development consulting services, digital learning content design and development solutions and a suite of managed learning operations services, including: managed facilitation and delivery, managed training administration and logistics, help desk support, tuition reimbursement management services, event management and vendor management.
|
•
|
Engineering & Technical Services
- this practice focuses on capital intensive, inherently hazardous and/or highly complex technical services in support of both U.S. government and global commercial industries. Our products and services include design, development and delivery of technical work-based learning, CapEx (plant launch) initiatives, engineering design and construction management, fabrication, and management services, operational excellence consulting, chemical demilitarization services, homeland security services, emergency management support services along with all forms of technical documentation. We deliver world-class asset management and performance improvement consulting to a host of industries. Our proprietary EtaPRO® Performance and Condition Monitoring System provides a suite of real-time digital solutions for hundreds of facilities and is installed in power-generating units around the world. We also provide thousands of technical courses in a web-based off the shelf delivery format through our GPiLEARN+™ portal.
|
•
|
Sales Enablement
- this practice provides custom product sales training and service technical training, primarily to automotive manufacturers, designed to better educate the customer salesforces as well as the service technicians with respect to new product features and designs, in effect rapidly increasing the salesforce and technicians knowledge base and enabling them to address retail customer needs. Furthermore, this segment helps our clients assess their customer relationship marketing strategy and connect with their customers on a one-to-one basis, including custom print and digital publications. We have been a custom product sales and service technical training provider and leader in serving manufacturing customers in the U.S. automotive industry for over 40 years.
|
•
|
Organizational Development
- this practice works with organizations to design and execute an integrated people performance system. This translates to helping organizations set strategy, carry that strategy through every level of the organization and ensure that their people have the right skills, knowledge, tools, processes and technology to enable the transformation and achieve business results. Solutions include strategy, leadership, employee engagement and culture consulting, enterprise technology implementation and adoption solutions, and organization design and business performance consulting.
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Workforce Excellence
|
$
|
80,516
|
|
|
$
|
77,022
|
|
|
$
|
239,044
|
|
|
$
|
228,236
|
|
Business Transformation Services
|
43,050
|
|
|
47,075
|
|
|
143,245
|
|
|
149,469
|
|
||||
|
$
|
123,566
|
|
|
$
|
124,097
|
|
|
$
|
382,289
|
|
|
$
|
377,705
|
|
Gross profit:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Workforce Excellence
|
$
|
13,400
|
|
|
$
|
11,892
|
|
|
$
|
39,682
|
|
|
$
|
39,324
|
|
Business Transformation Services
|
5,799
|
|
|
6,754
|
|
|
19,769
|
|
|
21,145
|
|
||||
Total gross profit
|
19,199
|
|
|
18,646
|
|
|
59,451
|
|
|
60,469
|
|
||||
General and administrative expenses
|
12,227
|
|
|
14,160
|
|
|
40,207
|
|
|
39,536
|
|
||||
Sales and marketing expenses
|
1,297
|
|
|
393
|
|
|
3,128
|
|
|
1,249
|
|
||||
Restructuring charges
|
—
|
|
|
—
|
|
|
2,930
|
|
|
—
|
|
||||
Gain on change in fair value of contingent consideration, net
|
526
|
|
|
268
|
|
|
3,972
|
|
|
369
|
|
||||
Operating income
|
6,201
|
|
|
4,361
|
|
|
17,158
|
|
|
20,053
|
|
||||
Interest expense
|
1,095
|
|
|
511
|
|
|
1,631
|
|
|
1,483
|
|
||||
Other (expense) income
|
(760
|
)
|
|
74
|
|
|
(1,912
|
)
|
|
(108
|
)
|
||||
Income before income tax expense
|
$
|
4,346
|
|
|
$
|
3,924
|
|
|
$
|
13,615
|
|
|
$
|
18,462
|
|
•
|
Managed Learning Services
- this practice focuses on creating value for our customers by delivering a suite of talent management and learning design, development, operational and support services that can be delivered as large scale outsourcing arrangements, managed services contracts and project-based service engagements. The Managed Learning Services offerings include strategic learning and development consulting services, digital learning content design and development solutions and a suite of managed learning operations services, including: managed facilitation and delivery, managed training administration and logistics, help desk support, tuition reimbursement management services, event management and vendor management.
|
•
|
Engineering & Technical Services
- this practice focuses on capital intensive, inherently hazardous and/or highly complex technical services in support of both U.S. government and global commercial industries. Our products and services include design, development and delivery of technical work-based learning, CapEx (plant launch) initiatives, engineering design and construction management, fabrication, and management services, operational excellence consulting, chemical demilitarization services, homeland security services, emergency management support services along with all forms of technical documentation. We deliver world-class asset management and performance improvement consulting to a host of industries. Our proprietary EtaPRO® Performance and Condition Monitoring System provides a suite of real-time digital solutions for hundreds of facilities and is installed in power-generating
|
•
|
Sales Enablement
- this practice provides custom product sales training and service technical training, primarily to automotive manufacturers, designed to better educate the customer salesforces as well as the service technicians with respect to new product features and designs, in effect rapidly increasing the salesforce and technicians knowledge base and enabling them to address retail customer needs. Furthermore, this segment helps our clients assess their customer relationship marketing strategy and connect with their customers on a one-to-one basis, including custom print and digital publications. We have been a custom product sales and service technical training provider and leader in serving manufacturing customers in the U.S. automotive industry for over 40 years.
|
•
|
Organizational Development
- this practice works with organizations to design and execute an integrated people performance system. This translates to helping organizations set strategy, carry that strategy through every level of the organization and ensure that their people have the right skills, knowledge, tools, processes and technology to enable the transformation and achieve business results. Solutions include strategy, leadership, employee engagement and culture consulting, enterprise technology implementation and adoption solutions, and organization design and business performance consulting.
|
(Dollars in thousands)
|
Three months ended
|
||||||
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
Workforce Excellence
|
$
|
80,516
|
|
|
$
|
77,022
|
|
Business Transformation Services
|
43,050
|
|
|
47,075
|
|
||
|
$
|
123,566
|
|
|
$
|
124,097
|
|
•
|
a $4.7 million net increase in revenue in our Engineering & Technical Services practice primarily due to a $1.8 million increase in hurricane relief services, a $1.0 million increase in chemical demilitarization training services for a U.S. government client and a $1.9 million increase in alternative fuels projects; partially offset by
|
•
|
a $0.6 million net decrease in revenue in our Managed Learning Services practice primarily due to the following:
|
◦
|
a $2.5 million decrease in vocational skills training services provided to the UK government; and
|
◦
|
a $1.6 million net decrease in revenue in the U.S. for digital learning and training content development services; partially offset by
|
◦
|
an estimated $3.5 million increase in revenue contributed by the acquisitions completed in this segment within the last twelve months that wasn't in the prior year comparative period, consisting of $2.9 million of revenue from the IC Axon acquisition completed on May 1, 2018 and $0.6 million of revenue from the YouTrain acquisition completed on August 31, 2017 (since the acquisitions are integrated into our operations, the estimated revenue contribution is based on a pro forma trailing twelve month revenue run rate at the time of acquisition); and
|
•
|
a $0.6 million net decrease in revenue due to changes in foreign currency exchange rates.
|
•
|
a $2.8 million net decrease in our Sales Enablement practice primarily due to the following:
|
◦
|
a $2.5 million decline due to the completion of non-recurring vehicle launch events in 2017; and
|
◦
|
a $2.1 million decline in magazine publications due to a change in the timing of shipment in certain publications from third quarter of 2018 to the fourth quarter of 2018; partially offset by
|
◦
|
a $1.2 million increase in training services for automotive clients; and
|
◦
|
an estimated $0.6 million increase in revenue contributed by the TTi Europe acquisition completed on August 7, 2018 (since the acquisitions are integrated into our operations, the estimated revenue contribution is based on a pro forma trailing twelve month revenue run rate at the time of acquisition).
|
•
|
a $1.1 million net decrease in our Organizational Development practice primarily due to the following:
|
◦
|
a $3.1 million decline in platform adoption, strategic consulting and leadership development services (if we continue to experience declines in revenue and gross profit in the Organization Development practice, we could incur goodwill and other intangible asset impairment charges in the future); partially offset by
|
◦
|
an estimated $2.0 million increase in revenue contributed by the acquisitions completed in this segment within the last twelve months that wasn't in the prior year comparative period, consisting of $1.6 million of revenue from the Hula Partners acquisition completed on January 2, 2018 and $0.4 million from the CLS acquisition completed on August 31, 2017 (since the acquisitions are integrated into our operations, the estimated revenue contribution is based on a pro forma trailing twelve month revenue run rate at the time of acquisition); and
|
•
|
a $0.1 million net decrease in revenue due to changes in foreign currency exchange rates.
|
(Dollars in thousands)
|
Three months ended
|
||||||||||||
|
September 30,
|
||||||||||||
|
2018
|
|
2017
|
||||||||||
|
|
|
% Revenue
|
|
|
|
% Revenue
|
||||||
Workforce Excellence
|
$
|
13,400
|
|
|
16.6
|
%
|
|
$
|
11,892
|
|
|
15.4
|
%
|
Business Transformation Services
|
5,799
|
|
|
13.5
|
%
|
|
6,754
|
|
|
14.3
|
%
|
||
|
$
|
19,199
|
|
|
15.5
|
%
|
|
$
|
18,646
|
|
|
15.0
|
%
|
•
|
a $2.6 million increase in gross profit in our Engineering & Technical Services practice primarily due to a $2.6 million loss on a contract with a foreign oil and gas client during the third quarter of 2017 which did not recur in 2018; partially offset by
|
•
|
a $1.1 million net decrease in gross profit in our Managed Learning Services practice primarily due to a $1.5 million decline in vocational skill training services provided to the UK government as a result of the lower revenue noted above, offset by a gross profit increase in the rest of the practice during the third quarter of 2018.
|
(Dollars in thousands)
|
Nine months ended
|
||||||
|
September 30,
|
||||||
|
2018
|
|
2017
|
||||
Workforce Excellence
|
$
|
239,044
|
|
|
$
|
228,236
|
|
Business Transformation Services
|
143,245
|
|
|
149,469
|
|
||
|
$
|
382,289
|
|
|
$
|
377,705
|
|
•
|
a $6.4 million net increase in revenue in our Engineering & Technical Services practice primarily due to a $2.8 million increase in hurricane relief services, $2.0 million increase in alternative fuels projects and a net $1.6 million net increase in engineering and technical services, primarily due to an increase in chemical demilitarization training services for a U.S. government client; and
|
•
|
a $4.4 million net increase in revenue due to changes in foreign currency exchange rates.
|
•
|
Revenue in our Managed Learning Services practice was flat during the first nine months of 2018 compared to the same period in 2017 and consisted primarily of the following changes:
|
◦
|
an estimated $7.9 million increase in revenue contributed by the acquisitions completed in this segment within the last twelve months that wasn't in the prior year comparative period, consisting of $4.8 million of revenue from the IC Axon acquisition completed on May 1, 2018 and $2.4 million of revenue from the YouTrain acquisition completed on August 31, 2017, and $0.7 million from the Emantras acquisition completed on April
|
◦
|
a $1.1 million net increase in revenue in the U.S. for digital learning and training content development services; partially offset by
|
◦
|
a $9.0 million decrease in vocational skills training services provided to the UK government.
|
•
|
a $4.1 million net decrease in our Sales Enablement practice primarily due to the following:
|
◦
|
a $7.2 million decline due to the completion of non-recurring vehicle launch events in 2017; and
|
◦
|
a $2.2 million decline in magazine publications due to a change in the timing of shipment in certain publications from third quarter of 2018 to the fourth quarter of 2018; partially offset by
|
◦
|
a $4.7 million increase in training services for automotive clients; and
|
◦
|
an estimated $0.6 million increase in revenue contributed by the TTi Europe acquisition completed on August 7, 2018 (since the acquisitions are integrated into our operations, the estimated revenue contribution is based on a pro forma trailing twelve month revenue run rate at the time of acquisition).
|
•
|
a $3.5 million net decrease in our Organizational Development practice primarily due to the following:
|
◦
|
a $10.4 million decline in platform adoption, strategic consulting and leadership development services (if we continue to experience declines in revenue and gross profit in the Organization Development practice, we could incur goodwill and other intangible asset impairment charges in the future); partially offset by
|
◦
|
an estimated $6.9 million increase in revenue contributed by the acquisitions completed in this segment within the last twelve months that wasn't in the prior year comparative period, consisting of $4.8 million of revenue from the Hula Partners acquisition completed on January 2, 2018 and $1.5 million from the CLS acquisition completed on August 31, 2017 ad $0.6 million from the McKinney Rogers acquisition completed on February 1, 2017 (since the acquisitions are integrated into our operations, the estimated revenue contribution is based on a pro forma trailing twelve month revenue run rate at the time of acquisition).
|
•
|
These decreases in revenue were offset by a $1.4 million net increase in revenue due to changes in foreign currency exchange rates.
|
(Dollars in thousands)
|
Nine months ended
|
||||||||||||
|
September 30,
|
||||||||||||
|
2018
|
|
2017
|
||||||||||
|
|
|
% Revenue
|
|
|
|
% Revenue
|
||||||
Workforce Excellence
|
$
|
39,682
|
|
|
16.6
|
%
|
|
$
|
39,324
|
|
|
17.2
|
%
|
Business Transformation Services
|
19,769
|
|
|
13.8
|
%
|
|
21,145
|
|
|
14.1
|
%
|
||
|
$
|
59,451
|
|
|
15.6
|
%
|
|
$
|
60,469
|
|
|
16.0
|
%
|
•
|
a $2.9 million increase in gross profit in our Engineering & Technical Services practice primarily due to a $2.6 million loss on a contract with a foreign oil and gas client during the third quarter of 2017 which did not recur in 2018; and
|
•
|
a $0.8 million net increase in revenue due to changes in foreign currency exchange rates; offset by
|
•
|
a $3.3 million net decrease in gross profit in our Managed Learning Services practice (consisting primarily of a $5.4 million decline in gross profit on vocational skill training services provided to the UK government as a result of the lower revenue noted above, partially offset by a net $2.1 million increase in the other business units within this practice due to cost cutting initiatives).
|
•
|
a $0.8 million increase in legal expenses relating to acquisitions;
|
•
|
a $0.4 million increase due to increases in foreign currency exchange rates compared to the prior year;
|
•
|
a $0.4 million increase in amortization expense.
|
Acquisition:
|
Original range of potential undiscounted payments
|
|
As of September 30, 2018 Maximum contingent consideration due in
|
|||||||||||
|
|
|
2018
|
2019
|
2020
|
Total
|
||||||||
IC Axon
|
$0 - $3,500
|
|
$
|
—
|
|
$
|
3,500
|
|
$
|
—
|
|
$
|
3,500
|
|
McKinney Rogers
|
$0 - $18,000
|
|
—
|
|
4,000
|
|
4,000
|
|
8,000
|
|
||||
|
|
|
$
|
—
|
|
$
|
7,500
|
|
$
|
4,000
|
|
$
|
11,500
|
|
|
|
|
|
|
|
|
|
|
Issuer Purchases of Equity Securities
|
|||||||||||||
|
|
Total number
of shares purchased
|
|
|
Average
price paid per share
|
|
Total number
of shares
purchased as
part of publicly announced program
|
|
Approximate
dollar value of
shares that may yet
be purchased under the program
(1)
|
||||||
Month
|
|
|
|
|
|
||||||||||
July 1 - 31, 2018
|
|
—
|
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
4,454,000
|
|
August 1 - 31, 2018
|
|
26,675
|
|
(2)
|
|
$
|
17.64
|
|
|
25,897
|
|
|
$
|
3,995,000
|
|
September 1 - 30, 2018
|
|
11,310
|
|
|
|
$
|
17.96
|
|
|
11,310
|
|
|
$
|
3,792,000
|
|
(1)
|
We have a share repurchase program under which we may repurchase shares of our common stock from time to time in the open market subject to prevailing business and market conditions and other factors. There is no expiration date for the repurchase program.
|
(2)
|
Includes shares surrendered by employees to satisfy minimum tax withholding obligations on restricted stock units which vested during the third quarter of 2018.
|
Item 6.
|
Exhibits
|
10.1
|
31.1
|
31.2
|
32.1
|
101
|
The following materials from GP Strategies Corporation’s Quarterly Report on Form 10-Q for the quarter ended
September 30, 2018
, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets; (ii) Condensed Consolidated Statements of Operations; (iii) Condensed Consolidated Statements of Comprehensive Income, (iv) Condensed Consolidated Statements of Cash Flows; and (v) Notes to Condensed Consolidated Financial Statements.*
|
*Filed herewith.
|
|
GP STRATEGIES CORPORATION
|
|
|
November 6, 2018
|
/s/ Scott N. Greenberg
|
|
Scott N. Greenberg
|
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Chief Executive Officer
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November 6, 2018
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/s/ Michael R. Dugan
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Michael R. Dugan
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Executive Vice President and Chief Financial Officer
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Category 1:
The members of the Executive Council of the Company, other than the Chief Executive Officer, as of the date of the STIP namely the President, Chief Financial Officer, Chief Sales Officer, General Counsel, and Executive Vice Presidents in charge of the Workforce Excellence and Business Transformation Services Segments.
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Category 2:
Any Executive Vice President or Senior Vice President of the Company who is not included in Category 1.
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Category 3:
Vice Presidents of the Company.
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Minimum – Results below this level of performance provide no STIP award. Results at or above this level of performance triggers award of 20% of the Target Bonus.
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Medium– Results at or above this level of performance triggers award of 60% of the Target Bonus.
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Target – Results at or above this level of performance triggers award of 100% of the Target Bonus.
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Maximum – Results at or above this level of performance triggers award of 150% of the Target Bonus.
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Action
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What Happens to the STIP award
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An employee is hired or promoted to a STIP eligible position
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The employee will participate on a pro rated basis for any full months that he or she works in the STIP year, provided he or she becomes a Participant before September 30, unless determined otherwise by the Compensation Committee.
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A Participant changes Category
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If the change occurs after September 30, any STIP awards will be based on the previous level unless determined otherwise by the Compensation Committee. If the change occurs before September 30, any STIP awards will be pro rated based on the amount of time spent at each level, unless determined otherwise by the Compensation Committee
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A Participant is terminated
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Except as otherwise required by applicable law, a Participant will not be eligible for any STIP award for the year in which the termination occurred unless the termination is for death, retirement or the Participant’s employment is terminated in a Company-initiated reduction in force, the Participant will be eligible for a prorated portion of the STIP award the Participant would have received had they remained employed.
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A Participant becomes ineligible under the STIP for a reason other than termination
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The employee will participate on a pro rated basis for any full months that he or she was eligible to be STIP Participant, unless determined otherwise by the Compensation Committee.
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1.
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I have reviewed this quarterly
report on Form
10-Q of GP Strategies Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: November 6, 2018
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/s/ Scott N. Greenberg
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Scott N. Greenberg
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Chief Executive Officer
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1.
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I have reviewed this quarterly
report on Form
10-Q of GP Strategies Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: November 6, 2018
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/s/ Michael R. Dugan
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Michael R. Dugan
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Executive Vice President and Chief Financial Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date: November 6, 2018
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/s/ Scott N. Greenberg
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/s/ Michael R. Dugan
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Scott N. Greenberg
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Michael R. Dugan
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Chief Executive Officer
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Executive Vice President and Chief Financial Officer
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