x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
For the quarterly period ended
March 31, 2017
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
For the transition period from
to
|
Aegion Corporation
|
(Exact name of registrant as specified in its charter)
|
Large accelerated filer
x
|
|
Accelerated filer
¨
|
|
|
|
Non-accelerated filer
¨
|
|
Smaller reporting company
¨
|
|
|
|
|
|
Emerging growth company
¨
|
PART I—FINANCIAL INFORMATION
|
|
|
|
Item 1. Financial Statements (Unaudited):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PART II—OTHER INFORMATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Quarters Ended
March 31,
|
||||||
|
2017
|
|
2016
|
||||
Revenues
|
$
|
325,175
|
|
|
$
|
293,908
|
|
Cost of revenues
|
257,763
|
|
|
239,494
|
|
||
Gross profit
|
67,412
|
|
|
54,414
|
|
||
Operating expenses
|
52,746
|
|
|
50,725
|
|
||
Acquisition-related expenses
|
533
|
|
|
1,031
|
|
||
Restructuring charges
|
—
|
|
|
6,797
|
|
||
Operating income (loss)
|
14,133
|
|
|
(4,139
|
)
|
||
Other income (expense):
|
|
|
|
||||
Interest expense
|
(4,047
|
)
|
|
(3,615
|
)
|
||
Interest income
|
49
|
|
|
32
|
|
||
Other
|
(387
|
)
|
|
(973
|
)
|
||
Total other expense
|
(4,385
|
)
|
|
(4,556
|
)
|
||
Income (loss) before taxes on income
|
9,748
|
|
|
(8,695
|
)
|
||
Taxes (benefit) on income (loss)
|
1,995
|
|
|
(4,746
|
)
|
||
Net income (loss)
|
7,753
|
|
|
(3,949
|
)
|
||
Non-controlling interests (income) loss
|
(1,882
|
)
|
|
157
|
|
||
Net income (loss) attributable to Aegion Corporation
|
$
|
5,871
|
|
|
$
|
(3,792
|
)
|
|
|
|
|
||||
Earnings (loss) per share attributable to Aegion Corporation:
|
|
|
|
||||
Basic
|
$
|
0.17
|
|
|
$
|
(0.11
|
)
|
Diluted
|
$
|
0.17
|
|
|
$
|
(0.11
|
)
|
|
For the Quarters Ended
March 31, |
||||||
|
2017
|
|
2016
|
||||
Net income (loss)
|
$
|
7,753
|
|
|
$
|
(3,949
|
)
|
Other comprehensive income (loss):
|
|
|
|
||||
Currency translation adjustments
|
3,869
|
|
|
(557
|
)
|
||
Deferred gain (loss) on hedging activity, net of tax
(1)
|
483
|
|
|
(3,573
|
)
|
||
Pension activity, net of tax
(2)
|
(5
|
)
|
|
(122
|
)
|
||
Total comprehensive income (loss)
|
12,100
|
|
|
(8,201
|
)
|
||
Comprehensive income attributable to non-controlling interests
|
(1,869
|
)
|
|
(85
|
)
|
||
Comprehensive income (loss) attributable to Aegion Corporation
|
$
|
10,231
|
|
|
$
|
(8,286
|
)
|
(1)
|
Amounts presented net of tax of
$321
and
$(2,392)
for the quarters ended
March 31, 2017
and
2016
, respectively.
|
(2)
|
Amounts presented net of tax of
$(1)
and
$(30)
for the quarters ended
March 31, 2017
and
2016
, respectively.
|
|
March 31,
2017 |
|
December 31,
2016 |
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
87,602
|
|
|
$
|
129,500
|
|
Restricted cash
|
1,573
|
|
|
4,892
|
|
||
Receivables, net of allowances of $5,303 and $6,098, respectively
|
207,943
|
|
|
186,016
|
|
||
Retainage
|
31,237
|
|
|
33,643
|
|
||
Costs and estimated earnings in excess of billings
|
75,535
|
|
|
62,401
|
|
||
Inventories
|
69,113
|
|
|
63,953
|
|
||
Prepaid expenses and other current assets
|
38,903
|
|
|
51,832
|
|
||
Total current assets
|
511,906
|
|
|
532,237
|
|
||
Property, plant & equipment, less accumulated depreciation
|
156,690
|
|
|
156,747
|
|
||
Other assets
|
|
|
|
||||
Goodwill
|
302,749
|
|
|
298,619
|
|
||
Identified intangible assets, less accumulated amortization
|
193,102
|
|
|
194,911
|
|
||
Deferred income tax assets
|
1,584
|
|
|
1,848
|
|
||
Other assets
|
9,371
|
|
|
9,220
|
|
||
Total other assets
|
506,806
|
|
|
504,598
|
|
||
Total Assets
|
$
|
1,175,402
|
|
|
$
|
1,193,582
|
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
64,713
|
|
|
$
|
63,058
|
|
Accrued expenses
|
71,821
|
|
|
85,010
|
|
||
Billings in excess of costs and estimated earnings
|
44,716
|
|
|
62,698
|
|
||
Current maturities of long-term debt
|
22,020
|
|
|
19,835
|
|
||
Total current liabilities
|
203,270
|
|
|
230,601
|
|
||
Long-term debt, less current maturities
|
354,427
|
|
|
350,785
|
|
||
Deferred income tax liabilities
|
23,731
|
|
|
23,339
|
|
||
Other non-current liabilities
|
13,102
|
|
|
12,674
|
|
||
Total liabilities
|
594,530
|
|
|
617,399
|
|
||
|
|
|
|
||||
(See Commitments and Contingencies: Note 9)
|
|
|
|
|
|
||
|
|
|
|
||||
Equity
|
|
|
|
||||
Preferred stock, undesignated, $.10 par – shares authorized 2,000,000; none outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par – shares authorized 125,000,000; shares issued and outstanding 33,604,854 and 33,956,304, respectively
|
336
|
|
|
340
|
|
||
Additional paid-in capital
|
159,191
|
|
|
166,598
|
|
||
Retained earnings
|
460,933
|
|
|
455,062
|
|
||
Accumulated other comprehensive loss
|
(49,140
|
)
|
|
(53,500
|
)
|
||
Total stockholders’ equity
|
571,320
|
|
|
568,500
|
|
||
Non-controlling interests
|
9,552
|
|
|
7,683
|
|
||
Total equity
|
580,872
|
|
|
576,183
|
|
||
Total Liabilities and Equity
|
$
|
1,175,402
|
|
|
$
|
1,193,582
|
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Non-
Controlling
Interests
|
|
Total
Equity
|
|||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|
||||||||||||||||||
BALANCE, December 31, 2015
|
36,053,499
|
|
|
$
|
361
|
|
|
$
|
199,951
|
|
|
$
|
425,574
|
|
|
$
|
(47,861
|
)
|
|
$
|
16,531
|
|
|
$
|
594,556
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,792
|
)
|
|
—
|
|
|
(157
|
)
|
|
(3,949
|
)
|
||||||
Issuance of common stock upon stock option exercises, including tax benefit
|
18,193
|
|
|
—
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38
|
|
||||||
Issuance of shares pursuant to restricted stock units
|
9,733
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Forfeitures of restricted shares
|
(14,528
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Shares repurchased and retired
|
(910,656
|
)
|
|
(9
|
)
|
|
(16,316
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,325
|
)
|
||||||
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
2,363
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,363
|
|
||||||
Sale of non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,278
|
)
|
|
(7,278
|
)
|
||||||
Currency translation adjustment and derivative transactions, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,494
|
)
|
|
242
|
|
|
(4,252
|
)
|
||||||
BALANCE, March 31, 2016
|
35,156,241
|
|
|
$
|
352
|
|
|
$
|
186,036
|
|
|
$
|
421,782
|
|
|
$
|
(52,355
|
)
|
|
$
|
9,338
|
|
|
$
|
565,153
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
BALANCE, December 31, 2016
|
33,956,304
|
|
|
$
|
340
|
|
|
$
|
166,598
|
|
|
$
|
455,062
|
|
|
$
|
(53,500
|
)
|
|
$
|
7,683
|
|
|
$
|
576,183
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
5,871
|
|
|
—
|
|
|
1,882
|
|
|
7,753
|
|
||||||
Issuance of shares pursuant to restricted stock units
|
62,279
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||
Issuance of shares pursuant to performance units
|
49,672
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Forfeitures of restricted shares
|
(1,084
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Shares repurchased and retired
|
(462,317
|
)
|
|
(5
|
)
|
|
(10,503
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,508
|
)
|
||||||
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
3,096
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,096
|
|
||||||
Currency translation adjustment and derivative transactions, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,360
|
|
|
(13
|
)
|
|
4,347
|
|
||||||
BALANCE, March 31, 2017
|
33,604,854
|
|
|
$
|
336
|
|
|
$
|
159,191
|
|
|
$
|
460,933
|
|
|
$
|
(49,140
|
)
|
|
$
|
9,552
|
|
|
$
|
580,872
|
|
|
For the Quarters Ended
March 31,
|
||||||
|
2017
|
|
2016
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
7,753
|
|
|
$
|
(3,949
|
)
|
Adjustments to reconcile to net cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
11,852
|
|
|
11,376
|
|
||
Gain on sale of fixed assets
|
(116
|
)
|
|
(499
|
)
|
||
Equity-based compensation expense
|
3,096
|
|
|
2,363
|
|
||
Deferred income taxes
|
5,533
|
|
|
(1,187
|
)
|
||
Non-cash restructuring charges
|
42
|
|
|
(212
|
)
|
||
Loss on foreign currency transactions
|
378
|
|
|
1,131
|
|
||
Other
|
(62
|
)
|
|
(485
|
)
|
||
Changes in operating assets and liabilities (net of acquisitions):
|
|
|
|
||||
Restricted cash related to operating activities
|
1,354
|
|
|
462
|
|
||
Receivables net, retainage and costs and estimated earnings in excess of billings
|
(30,257
|
)
|
|
29,618
|
|
||
Inventories
|
(3,491
|
)
|
|
(1,806
|
)
|
||
Prepaid expenses and other assets
|
5,351
|
|
|
3,382
|
|
||
Accounts payable and accrued expenses
|
(9,988
|
)
|
|
(39,086
|
)
|
||
Billings in excess of costs and estimated earnings
|
(18,078
|
)
|
|
(3,672
|
)
|
||
Other operating
|
300
|
|
|
582
|
|
||
Net cash used in operating activities
|
(26,333
|
)
|
|
(1,982
|
)
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(3,907
|
)
|
|
(10,060
|
)
|
||
Proceeds from sale of fixed assets
|
165
|
|
|
956
|
|
||
Patent expenditures
|
(289
|
)
|
|
(541
|
)
|
||
Restricted cash related to investing activities
|
2,000
|
|
|
(1,086
|
)
|
||
Purchase of Underground Solutions, Inc., net of cash acquired
|
—
|
|
|
(85,167
|
)
|
||
Other acquisition activity, net of cash acquired
|
(9,045
|
)
|
|
(500
|
)
|
||
Sale of interest in Bayou Perma-Pipe Canada, Ltd., net of cash disposed
|
—
|
|
|
4,599
|
|
||
Net cash used in investing activities
|
(11,076
|
)
|
|
(91,799
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from issuance of common stock upon stock option exercises
|
—
|
|
|
38
|
|
||
Repurchase of common stock
|
(10,508
|
)
|
|
(16,325
|
)
|
||
Payment of contingent consideration
|
(500
|
)
|
|
—
|
|
||
Proceeds from line of credit
|
10,000
|
|
|
34,000
|
|
||
Principal payments on long-term debt
|
(4,375
|
)
|
|
(4,375
|
)
|
||
Net cash provided by (used in) financing activities
|
(5,383
|
)
|
|
13,338
|
|
||
Effect of exchange rate changes on cash
|
894
|
|
|
(3,394
|
)
|
||
Net decrease in cash and cash equivalents for the period
|
(41,898
|
)
|
|
(83,837
|
)
|
||
Cash and cash equivalents, beginning of year
|
129,500
|
|
|
211,696
|
|
||
Cash and cash equivalents, end of period
|
$
|
87,602
|
|
|
$
|
127,859
|
|
|
Quarter Ended
March 31, 2017
|
|
Quarter Ended
March 31, 2016
|
||||||||||||||||||||
|
Environmental
Techniques
|
|
Underground
Solutions
(1)
|
|
Fyfe
Europe |
|
LMJ
|
|
Concrete
Solutions |
|
Underground
Solutions
(2)
|
||||||||||||
Revenues
|
$
|
451
|
|
|
$
|
6,525
|
|
|
$
|
259
|
|
|
$
|
1,337
|
|
|
$
|
1,383
|
|
|
$
|
4,666
|
|
Net income (loss)
|
(102
|
)
|
|
(1,319
|
)
|
|
(58
|
)
|
|
(597
|
)
|
|
50
|
|
|
(124
|
)
|
(1)
|
The reported net loss for Underground Solutions for the quarter ended March 31, 2017 includes an allocation of corporate expenses of
$0.4 million
.
|
(2)
|
The reported net loss for Underground Solutions for the quarter ended March 31, 2016 includes inventory step-up expense of
$1.2 million
recognized as part of the accounting for business combinations.
|
|
Quarters Ended March 31,
|
||||||
|
2017
(1)
|
|
2016
(2)
|
||||
Revenues
|
$
|
326,057
|
|
|
$
|
302,869
|
|
Net income (loss) attributable to Aegion Corporation
(3)
|
5,698
|
|
|
(3,330
|
)
|
||
Diluted earnings (loss) per share
|
$
|
0.17
|
|
|
$
|
(0.09
|
)
|
(1)
|
Includes pro-forma results related to Environmental Techniques.
|
(2)
|
Includes pro-forma results related to Environmental Techniques, Underground Solutions, Fyfe Europe, LMJ and Concrete Solutions.
|
(3)
|
Includes pro-forma adjustments for depreciation and amortization associated with acquired tangible and intangible assets, as if those assets were recorded at the beginning of the year preceding the acquisition date.
|
|
Environmental
Techniques
|
|
Underground
Solutions
|
|
Fyfe
Europe
|
|
LMJ
|
|
Concrete
Solutions
|
||||||||||
Cash
|
$
|
—
|
|
|
$
|
3,630
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Receivables and cost and estimated earnings in excess of billings
|
801
|
|
|
6,339
|
|
|
—
|
|
|
—
|
|
|
1,469
|
|
|||||
Inventories
|
1,281
|
|
|
12,629
|
|
|
—
|
|
|
504
|
|
|
857
|
|
|||||
Prepaid expenses and other current assets
|
93
|
|
|
671
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||
Property, plant and equipment
|
1,694
|
|
|
2,755
|
|
|
50
|
|
|
1,194
|
|
|
422
|
|
|||||
Identified intangible assets
|
2,011
|
|
|
33,370
|
|
|
513
|
|
|
795
|
|
|
1,722
|
|
|||||
Deferred income tax assets
|
—
|
|
|
13,282
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other assets
|
—
|
|
|
90
|
|
|
|
|
|
—
|
|
|
—
|
|
|||||
Accounts payable
|
(1,025
|
)
|
|
(4,653
|
)
|
|
—
|
|
|
—
|
|
|
(837
|
)
|
|||||
Accrued expenses
|
(186
|
)
|
|
(5,900
|
)
|
|
—
|
|
|
—
|
|
|
(149
|
)
|
|||||
Billings in excess of cost and estimated earnings
|
—
|
|
|
(2,943
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Deferred income tax liabilities
|
—
|
|
|
(14,562
|
)
|
|
—
|
|
|
—
|
|
|
(482
|
)
|
|||||
Total identifiable net assets
|
$
|
4,669
|
|
|
$
|
44,708
|
|
|
$
|
563
|
|
|
$
|
2,493
|
|
|
$
|
3,020
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total consideration recorded
|
$
|
8,046
|
|
|
$
|
88,370
|
|
|
$
|
3,000
|
|
|
$
|
3,235
|
|
|
$
|
6,393
|
|
Less: total identifiable net assets
|
4,669
|
|
|
44,708
|
|
|
563
|
|
|
2,493
|
|
|
3,020
|
|
|||||
Goodwill at March 31, 2017
|
$
|
3,377
|
|
|
$
|
43,662
|
|
|
$
|
2,437
|
|
|
$
|
742
|
|
|
$
|
3,373
|
|
|
March 31, 2017
|
|
December 31, 2016
|
||||
Currency translation adjustments
|
$
|
(51,313
|
)
|
|
$
|
(54,863
|
)
|
Derivative hedging activity
|
1,808
|
|
|
1,004
|
|
||
Pension activity
|
365
|
|
|
359
|
|
||
Total accumulated other comprehensive loss
|
$
|
(49,140
|
)
|
|
$
|
(53,500
|
)
|
•
|
significant underperformance of a reporting unit relative to expected, historical or forecasted operating results;
|
•
|
significant negative industry or economic trends;
|
•
|
significant changes in the strategy for a segment including extended slowdowns in the reporting unit’s market;
|
•
|
a decrease in market capitalization below the Company’s book value; and
|
•
|
a significant change in regulations.
|
•
|
determine whether the entity meets the criteria to qualify as a VIE; and
|
•
|
determine whether the Company is the primary beneficiary of the VIE.
|
•
|
the design of the entity, including the nature of its risks and the purpose for which the entity was created, to determine the variability that the entity was designed to create and distribute to its interest holders;
|
•
|
the nature of the Company’s involvement with the entity;
|
•
|
whether control of the entity may be achieved through arrangements that do not involve voting equity;
|
•
|
whether there is sufficient equity investment at risk to finance the activities of the entity; and
|
•
|
whether parties other than the equity holders have the obligation to absorb expected losses or the right to receive residual returns.
|
•
|
whether the entity has the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance; and
|
•
|
whether the entity has the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity.
|
Balance sheet data
(1)
|
March 31,
2017 |
|
December 31,
2016 |
||||
Current assets
|
$
|
76,863
|
|
|
$
|
51,354
|
|
Non-current assets
|
24,757
|
|
|
25,607
|
|
||
Current liabilities
|
48,065
|
|
|
29,324
|
|
||
Non-current liabilities
|
31,496
|
|
|
28,849
|
|
|
Quarters Ended March 31,
|
||||||
Income statement data
(1)
|
2017
|
|
2016
|
||||
Revenue
|
$
|
34,061
|
|
|
$
|
14,736
|
|
Gross profit
|
5,530
|
|
|
639
|
|
||
Net income (loss) attributable to Aegion Corporation
|
1,272
|
|
|
(2,940
|
)
|
(1)
|
During the first quarter of 2017, increased activity was primarily driven from our joint venture in Louisiana, which continued its work on a large deepwater pipe coating and insulation project.
|
|
Quarter Ended March 31, 2016
|
||||||||||||||
|
Infrastructure
Solutions
|
|
Corrosion
Protection
|
|
Energy
Services
|
|
Total
|
||||||||
Severance and benefit related costs
|
$
|
1,912
|
|
|
$
|
2,420
|
|
|
$
|
1,309
|
|
|
$
|
5,641
|
|
Lease termination costs
|
—
|
|
|
—
|
|
|
969
|
|
|
969
|
|
||||
Relocation and other moving costs
|
—
|
|
|
—
|
|
|
120
|
|
|
120
|
|
||||
Other restructuring costs
(1)
|
241
|
|
|
317
|
|
|
2,454
|
|
|
3,012
|
|
||||
Total pre-tax restructuring charges (reversals)
(2)
|
$
|
2,153
|
|
|
$
|
2,737
|
|
|
$
|
4,852
|
|
|
$
|
9,742
|
|
(1)
|
Includes charges primarily related to downsizing the Company’s upstream operations in California, inclusive of wind-down costs, professional fees, fixed asset disposals and certain other restructuring charges.
|
(2)
|
Includes
$1.0 million
of corporate-related restructuring charges that have been allocated to the reportable segments.
|
|
Quarter Ended March 31, 2016
|
||
Cost of revenues
(1)
|
$
|
49
|
|
Operating expenses
(2)
|
2,963
|
|
|
Restructuring charges
(3)
|
6,730
|
|
|
Total pre-tax restructuring charges
(4)
|
$
|
9,742
|
|
(1)
|
All charges relate to Infrastructure Solutions.
|
(2)
|
Includes: (i) charges of
$0.2 million
related to Infrastructure Solutions; (ii) charges of
$0.3 million
related to Corrosion Protection; and (iii) charges of
$2.5 million
related to Energy Services.
|
(3)
|
Includes: (i) charges of
$1.9 million
related to Infrastructure Solutions; (ii) charges of
$2.4 million
related to Corrosion Protection; and (iii) charges of
$2.4 million
related to Energy Services.
|
(4)
|
All charges incurred during the quarter will be settled in cash, either during the current quarter or future periods.
|
|
Reserves at December 31, 2016
|
|
2017
Charge to Income |
|
Utilized in 2017
|
|
Reserves at
March 31, 2017 |
||||||||||||
|
|
Cash
(1)
|
|
Non-Cash
|
|
||||||||||||||
Severance and benefit related costs
|
$
|
645
|
|
|
$
|
—
|
|
|
$
|
228
|
|
|
$
|
—
|
|
|
$
|
417
|
|
Lease termination costs
|
125
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
95
|
|
|||||
Relocation and other moving costs
|
10
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|||||
Other restructuring costs
|
120
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
88
|
|
|||||
Total pre-tax restructuring charges
|
$
|
900
|
|
|
$
|
—
|
|
|
$
|
300
|
|
|
$
|
—
|
|
|
$
|
600
|
|
(1)
|
Refers to cash utilized to settle charges, either those reserved at December 31, 2016 or charged to income during the first quarter of 2017.
|
|
2016
Charge to Income |
|
Utilized in 2016
|
|
Reserves at
March 31, 2016 |
||||||||||
|
|
Cash
(1)
|
|
Non-Cash
|
|
||||||||||
Severance and benefit related costs
|
$
|
5,641
|
|
|
$
|
3,062
|
|
|
$
|
—
|
|
|
$
|
2,579
|
|
Lease termination costs
|
969
|
|
|
583
|
|
|
—
|
|
|
386
|
|
||||
Relocation and other moving costs
|
120
|
|
|
120
|
|
|
—
|
|
|
—
|
|
||||
Other restructuring costs
|
3,012
|
|
|
2,906
|
|
|
—
|
|
|
106
|
|
||||
Total pre-tax restructuring charges
|
$
|
9,742
|
|
|
$
|
6,671
|
|
|
$
|
—
|
|
|
$
|
3,071
|
|
(1)
|
Refers to cash utilized to settle charges during the first quarter of 2016.
|
|
Quarters Ended March 31,
|
||||
|
2017
|
|
2016
|
||
Weighted average number of common shares used for basic EPS
|
33,819,331
|
|
|
35,488,580
|
|
Effect of dilutive stock options and restricted and deferred stock unit awards
|
685,257
|
|
|
—
|
|
Weighted average number of common shares and dilutive potential common stock used in dilutive EPS
|
34,504,588
|
|
|
35,488,580
|
|
|
Infrastructure
Solutions |
|
Corrosion
Protection |
|
Energy
Services |
|
Total
|
||||||||
Balance, January 1, 2017
|
|
|
|
|
|
|
|
||||||||
Goodwill, gross
|
$
|
239,494
|
|
|
$
|
73,875
|
|
|
$
|
80,246
|
|
|
$
|
393,615
|
|
Accumulated impairment losses
|
(16,069
|
)
|
|
(45,400
|
)
|
|
(33,527
|
)
|
|
(94,996
|
)
|
||||
Goodwill, net
|
223,425
|
|
|
28,475
|
|
|
46,719
|
|
|
298,619
|
|
||||
Acquisitions
(1)
|
3,377
|
|
|
—
|
|
|
—
|
|
|
3,377
|
|
||||
Foreign currency translation
|
688
|
|
|
65
|
|
|
—
|
|
|
753
|
|
||||
Balance, March 31, 2017
|
|
|
|
|
|
|
|
||||||||
Goodwill, gross
|
243,559
|
|
|
73,940
|
|
|
80,246
|
|
|
397,745
|
|
||||
Accumulated impairment losses
|
(16,069
|
)
|
|
(45,400
|
)
|
|
(33,527
|
)
|
|
(94,996
|
)
|
||||
Goodwill, net
|
$
|
227,490
|
|
|
$
|
28,540
|
|
|
$
|
46,719
|
|
|
$
|
302,749
|
|
(1)
|
During the
first quarter of 2017
, the Company recorded goodwill of
$3.4 million
related to the acquisition of Environmental Techniques (see Note 1).
|
|
|
|
March 31, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
|
Weighted
Average
Useful
Lives
(Years)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
License agreements
|
9.3
|
|
$
|
4,426
|
|
|
$
|
(3,488
|
)
|
|
$
|
938
|
|
|
$
|
4,418
|
|
|
$
|
(3,438
|
)
|
|
$
|
980
|
|
Leases
|
10.6
|
|
2,065
|
|
|
(948
|
)
|
|
1,117
|
|
|
2,065
|
|
|
(912
|
)
|
|
1,153
|
|
||||||
Trademarks
(1)
|
13.7
|
|
24,664
|
|
|
(8,285
|
)
|
|
16,379
|
|
|
24,185
|
|
|
(7,868
|
)
|
|
16,317
|
|
||||||
Non-competes
|
1.6
|
|
1,309
|
|
|
(1,082
|
)
|
|
227
|
|
|
1,308
|
|
|
(1,054
|
)
|
|
254
|
|
||||||
Customer relationships
(1)
|
11.2
|
|
189,416
|
|
|
(56,898
|
)
|
|
132,518
|
|
|
187,554
|
|
|
(53,830
|
)
|
|
133,724
|
|
||||||
Patents and acquired technology
|
10.0
|
|
66,526
|
|
|
(24,603
|
)
|
|
41,923
|
|
|
66,222
|
|
|
(23,739
|
)
|
|
42,483
|
|
||||||
|
|
|
$
|
288,406
|
|
|
$
|
(95,304
|
)
|
|
$
|
193,102
|
|
|
$
|
285,752
|
|
|
$
|
(90,841
|
)
|
|
$
|
194,911
|
|
(1)
|
During the
first quarter of 2017
, the Company recorded trademarks of
$0.4 million
and customer relationships of
$1.6 million
related to the acquisition of Environmental Techniques (see Note 1).
|
2017
|
|
$
|
17,320
|
|
2018
|
|
17,305
|
|
|
2019
|
|
17,049
|
|
|
2020
|
|
16,925
|
|
|
2021
|
|
16,878
|
|
|
March 31,
2017 |
|
December 31,
2016 |
||||
Term note, due October 30, 2020, annualized rates of 3.27% and 3.08%, respectively
|
$
|
323,750
|
|
|
$
|
328,125
|
|
Line of credit, 3.18% and 2.96%, respectively
|
46,000
|
|
|
36,000
|
|
||
Other notes with interest rates from 3.3% to 6.5%
|
9,881
|
|
|
9,901
|
|
||
Subtotal
|
379,631
|
|
|
374,026
|
|
||
Less – Current maturities of long-term debt
|
22,020
|
|
|
19,835
|
|
||
Less – Unamortized loan costs
|
3,184
|
|
|
3,406
|
|
||
Total
|
$
|
354,427
|
|
|
$
|
350,785
|
|
•
|
Consolidated financial leverage ratio compares consolidated funded indebtedness to Credit Facility defined income. The initial maximum amount was not to initially exceed
3.75
to 1.00. In connection with the acquisition of Underground Solutions, the Company executed a one-time election, in accordance with the Credit Agreement, to increase the consolidated financial leverage ratio to
4.00
to 1.00 for a period of
one year
, which expired during the first quarter of 2017. For the quarter ended March 31, 2017, the maximum amount was not to exceed
3.75
to 1.00. The ratio will decrease to not more than
3.50
to 1.00 beginning with the quarter ending June 30, 2017. At
March 31, 2017
, the Company’s consolidated financial leverage ratio was
3.10
to 1.00 and, using the Credit Facility defined income, the Company had the capacity to borrow up to
$80.9 million
of additional debt.
|
•
|
Consolidated fixed charge coverage ratio compares Credit Facility defined income to Credit Facility defined fixed charges with a minimum permitted ratio of not less than
1.25
to 1.00. At
March 31, 2017
, the Company’s fixed charge ratio was
1.72
to 1.00.
|
|
Quarter Ended
March 31, 2017 |
|||||
|
Stock Awards
|
|
Weighted
Average
Award Date
Fair Value
|
|||
Outstanding at January 1, 2017
|
1,501,021
|
|
|
$
|
18.78
|
|
Restricted shares awarded
|
—
|
|
|
—
|
|
|
Restricted stock units awarded
|
222,895
|
|
|
23.09
|
|
|
Performance stock units awarded
|
213,436
|
|
|
23.04
|
|
|
Restricted shares distributed
|
(158,306
|
)
|
|
22.71
|
|
|
Restricted stock units distributed
|
(62,164
|
)
|
|
22.29
|
|
|
Performance stock units distributed
|
(49,672
|
)
|
|
21.95
|
|
|
Restricted shares forfeited
|
(1,084
|
)
|
|
23.01
|
|
|
Restricted stock units forfeited
|
(5,734
|
)
|
|
17.76
|
|
|
Performance stock units forfeited
|
(29,978
|
)
|
|
18.99
|
|
|
Outstanding at March 31, 2017
|
1,630,414
|
|
|
$
|
19.31
|
|
|
Quarter Ended
March 31, 2017 |
|||||
|
Deferred
Stock
Units
|
|
Weighted
Average
Award Date
Fair Value
|
|||
Outstanding at January 1, 2017
|
253,445
|
|
|
$
|
19.93
|
|
Awarded
|
3,026
|
|
|
24.06
|
|
|
Distributed
|
—
|
|
|
—
|
|
|
Outstanding at March 31, 2017
|
256,471
|
|
|
$
|
19.98
|
|
|
Quarter Ended
March 31, 2017 |
|||||
|
Shares
|
|
Weighted
Average
Exercise
Price
|
|||
Outstanding at January 1, 2017
|
170,253
|
|
|
$
|
21.99
|
|
Granted
|
—
|
|
|
—
|
|
|
Exercised
|
—
|
|
|
—
|
|
|
Canceled/Expired
|
—
|
|
|
—
|
|
|
Outstanding at March 31, 2017
|
170,253
|
|
|
$
|
21.99
|
|
Exercisable at March 31, 2017
|
170,253
|
|
|
$
|
21.99
|
|
|
Quarters Ended
March 31, |
||||||
|
2017
|
|
2016
|
||||
Amount collected from stock option exercises
|
$
|
—
|
|
|
$
|
306
|
|
Total intrinsic value of stock option exercises
|
—
|
|
|
352
|
|
||
Tax shortfall of stock option exercises recorded in additional paid-in-capital
|
—
|
|
|
18
|
|
||
Aggregate intrinsic value of outstanding stock options
|
444
|
|
|
320
|
|
||
Aggregate intrinsic value of exercisable stock options
|
444
|
|
|
320
|
|
|
Quarters Ended
March 31, |
||||||
|
2017
(1)
|
|
2016
(2)
|
||||
Revenues:
|
|
|
|
||||
Infrastructure Solutions
|
$
|
128,868
|
|
|
$
|
125,762
|
|
Corrosion Protection
|
123,390
|
|
|
92,446
|
|
||
Energy Services
|
72,917
|
|
|
75,700
|
|
||
Total revenues
|
$
|
325,175
|
|
|
$
|
293,908
|
|
|
|
|
|
||||
Gross profit:
|
|
|
|
||||
Infrastructure Solutions
|
$
|
31,251
|
|
|
$
|
29,744
|
|
Corrosion Protection
|
27,963
|
|
|
17,199
|
|
||
Energy Services
|
8,198
|
|
|
7,471
|
|
||
Total gross profit
|
$
|
67,412
|
|
|
$
|
54,414
|
|
|
|
|
|
||||
Operating income (loss):
|
|
|
|
||||
Infrastructure Solutions
(3)
|
$
|
5,610
|
|
|
$
|
5,808
|
|
Corrosion Protection
(4)
|
7,212
|
|
|
(5,670
|
)
|
||
Energy Services
(5)
|
1,311
|
|
|
(4,277
|
)
|
||
Total operating income (loss)
|
14,133
|
|
|
(4,139
|
)
|
||
Other income (expense):
|
|
|
|
||||
Interest expense
|
(4,047
|
)
|
|
(3,615
|
)
|
||
Interest income
|
49
|
|
|
32
|
|
||
Other
|
(387
|
)
|
|
(973
|
)
|
||
Total other expense
|
(4,385
|
)
|
|
(4,556
|
)
|
||
Income (loss) before taxes on income
|
$
|
9,748
|
|
|
$
|
(8,695
|
)
|
(1)
|
Results include: (i)
$0.1 million
of 2014 Restructuring expense reversals; and (ii)
$0.5 million
of costs incurred related to the acquisitions of Environmental Techniques and other acquisition targets.
|
(2)
|
Results include: (i)
$9.7 million
of 2016 Restructuring charges (see Note 3); (ii)
$0.2 million
of 2014 Restructuring expense reversals; (iii)
$1.0 million
of costs incurred related to the acquisition of Underground Solutions and other acquisition targets; and (iv) inventory step up expense of
$1.2 million
recognized as part of the accounting for business combinations (see Note 1).
|
(3)
|
Operating income in the first quarter of 2017 includes: (i)
$0.1 million
of 2014 Restructuring expense reversals; and (ii)
$0.5 million
of costs incurred related to the acquisition of Environmental Techniques and other acquisition targets. Operating income in the first quarter of 2016 includes: (i)
$2.2 million
of 2016 Restructuring charges (see Note 3); (ii)
$0.2 million
of 2014 Restructuring expense reversals; (iii)
$1.0 million
of costs incurred related to the acquisitions of Underground Solutions and other acquisition targets; and (iv) inventory step up expense of
$1.2 million
recognized as part of the accounting for business combinations (see Note 1).
|
(4)
|
Operating loss in the first quarter of 2016 includes
$2.7 million
of 2016 Restructuring charges (see Note 3).
|
(5)
|
Operating loss in the first quarter of 2016 includes
$4.9 million
of 2016 Restructuring charges (see Note 3).
|
|
Quarters Ended
March 31, |
||||||
|
2017
|
|
2016
|
||||
Revenues
(1)
:
|
|
|
|
||||
United States
|
$
|
257,724
|
|
|
$
|
223,569
|
|
Canada
|
26,827
|
|
|
27,619
|
|
||
Europe
|
16,145
|
|
|
13,821
|
|
||
Other foreign
|
24,479
|
|
|
28,899
|
|
||
Total revenues
|
$
|
325,175
|
|
|
$
|
293,908
|
|
|
|
|
|
||||
Gross profit:
|
|
|
|
||||
United States
|
$
|
56,032
|
|
|
$
|
39,862
|
|
Canada
|
4,514
|
|
|
5,414
|
|
||
Europe
|
3,159
|
|
|
2,789
|
|
||
Other foreign
|
3,707
|
|
|
6,349
|
|
||
Total gross profit
|
$
|
67,412
|
|
|
$
|
54,414
|
|
|
|
|
|
||||
Operating income (loss):
|
|
|
|
||||
United States
|
$
|
12,517
|
|
|
$
|
(7,552
|
)
|
Canada
|
1,460
|
|
|
1,569
|
|
||
Europe
|
408
|
|
|
159
|
|
||
Other foreign
|
(252
|
)
|
|
1,685
|
|
||
Total operating income (loss)
|
$
|
14,133
|
|
|
$
|
(4,139
|
)
|
(1)
|
Revenues are attributed to the country of origin for the Company’s legal entities. For a significant majority of its legal entities, the country of origin relates to the country or geographic area that it services.
|
|
Total Fair Value at
March 31, 2017 |
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Forward Currency Contracts
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest Rate Swap
|
1,863
|
|
|
—
|
|
|
1,863
|
|
|
—
|
|
||||
Total
|
$
|
1,863
|
|
|
$
|
—
|
|
|
$
|
1,863
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Forward Currency Contracts
|
$
|
96
|
|
|
$
|
—
|
|
|
$
|
96
|
|
|
$
|
—
|
|
Interest Rate Swap
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
96
|
|
|
$
|
—
|
|
|
$
|
96
|
|
|
$
|
—
|
|
|
Total Fair Value at
December 31, 2016 |
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Forward Currency Contracts
|
$
|
26
|
|
|
$
|
—
|
|
|
$
|
26
|
|
|
$
|
—
|
|
Interest Rate Swap
|
1,061
|
|
|
—
|
|
|
1,061
|
|
|
—
|
|
||||
Total
|
$
|
1,087
|
|
|
$
|
—
|
|
|
$
|
1,087
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Forward Currency Contracts
|
$
|
57
|
|
|
$
|
—
|
|
|
$
|
57
|
|
|
$
|
—
|
|
Interest Rate Swap
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
57
|
|
|
$
|
—
|
|
|
$
|
57
|
|
|
$
|
—
|
|
|
Position
|
|
Notional
Amount
|
|
Weighted
Average
Remaining
Maturity
In Years
|
|
Average
Exchange
Rate
|
||
USD/EURO
|
Sell
|
|
€
|
3,400,000
|
|
|
0.3
|
|
1.07
|
USD/British Pound
|
Sell
|
|
£
|
4,595,000
|
|
|
0.3
|
|
1.26
|
EURO/British Pound
|
Sell
|
|
£
|
5,700,000
|
|
|
0.3
|
|
.85
|
Interest Rate Swap
|
|
|
$
|
242,812,500
|
|
|
3.6
|
|
|
i.
|
adding patented Fusible PVC
®
pipe technology to our pressure pipe rehabilitation portfolio through the acquisition of Underground Solutions;
|
ii.
|
expanding our CIPP presence in Europe by acquiring the CIPP contracting operations of Leif M. Jensen A/S (“LMJ”), a Danish company and the Insituform licensee in Denmark since 2011, and acquiring Environmental Techniques Limited and its parent holding company, Killeen Trading Limited (collectively “Environmental Techniques”), a Northern Ireland-based provider of trenchless drainage inspection, cleaning and rehabilitation services throughout the United Kingdom and the Republic of Ireland;
|
iii.
|
acquiring the remaining worldwide rights that we did not already own to market, manufacture and install the patented Tyfo
®
Fibrwrap
®
FRP technology by acquiring the operations and territories of Fyfe Europe S.A. and related companies (“Fyfe Europe”); and
|
iv.
|
expanding our
FRP
presence in Asia through the acquisition of Concrete Solutions Limited
(“CSL”)
and Building Chemical Supplies Limited (“BCS”), two New Zealand-based companies that operated as a
Fibrwrap
®
certified applicator in New Zealand for a number of years
(collectively,
“Concrete Solutions”
).
|
(dollars in thousands)
|
Quarters Ended March 31,
|
|
Increase (Decrease)
|
|||||||||||
|
2017
|
|
2016
|
|
$
|
|
%
|
|||||||
Revenues
|
$
|
325,175
|
|
|
$
|
293,908
|
|
|
$
|
31,267
|
|
|
10.6
|
%
|
Gross profit
|
67,412
|
|
|
54,414
|
|
|
12,998
|
|
|
23.9
|
|
|||
Gross profit margin
|
20.7
|
%
|
|
18.5
|
%
|
|
N/A
|
|
|
220
|
bp
|
|||
Operating expenses
|
52,746
|
|
|
50,725
|
|
|
2,021
|
|
|
4.0
|
|
|||
Acquisition-related expenses
|
533
|
|
|
1,031
|
|
|
(498
|
)
|
|
(48.3
|
)
|
|||
Restructuring charges
|
—
|
|
|
6,797
|
|
|
(6,797
|
)
|
|
(100.0
|
)
|
|||
Operating income (loss)
|
14,133
|
|
|
(4,139
|
)
|
|
18,272
|
|
|
441.5
|
|
|||
Operating margin
|
4.3
|
%
|
|
(1.4
|
)%
|
|
N/A
|
|
|
570
|
bp
|
|||
Net income (loss) from continuing operations
|
5,871
|
|
|
(3,792
|
)
|
|
9,663
|
|
|
254.8
|
|
|
March 31,
2017 |
|
December 31,
2016
|
|
March 31,
2016 |
||||||
Infrastructure Solutions
|
$
|
317.1
|
|
|
$
|
283.4
|
|
|
$
|
327.6
|
|
Corrosion Protection
(1)
|
188.9
|
|
|
213.4
|
|
|
259.9
|
|
|||
Energy Services
(2)
|
206.3
|
|
|
192.8
|
|
|
169.2
|
|
|||
Total backlog
|
$
|
712.3
|
|
|
$
|
689.6
|
|
|
$
|
756.7
|
|
(1)
|
March 31, 2017, December 31, 2016 and March 31, 2016 included backlog from our large, domestic deepwater pipe coating and insulation contract of
$51.7 million
,
$96.8 million
and
$134.5 million
, respectively.
|
(2)
|
Represents expected unrecognized revenues to be realized under long-term MSAs and other signed contracts. If the remaining term of these arrangements exceeds 12 months, the unrecognized revenues attributable to such arrangements included in backlog are limited to only the next 12 months of expected revenues.
|
(dollars in thousands)
|
Quarters Ended March 31,
|
|
Increase (Decrease)
|
|||||||||||
|
2017
|
|
2016
|
|
$
|
|
%
|
|||||||
Revenues
|
$
|
123,390
|
|
|
$
|
92,446
|
|
|
$
|
30,944
|
|
|
33.5
|
%
|
Gross profit
|
27,963
|
|
|
17,199
|
|
|
10,764
|
|
|
62.6
|
|
|||
Gross profit margin
|
22.7
|
%
|
|
18.6
|
%
|
|
N/A
|
|
|
410
|
bp
|
|||
Operating expenses
|
20,751
|
|
|
20,449
|
|
|
302
|
|
|
1.5
|
|
|||
Restructuring charges
|
—
|
|
|
(2,420
|
)
|
|
2,420
|
|
|
(100.0
|
)
|
|||
Operating income (loss)
|
7,212
|
|
|
(5,670
|
)
|
|
12,882
|
|
|
227.2
|
|
|||
Operating margin
|
5.8
|
%
|
|
(6.1
|
)%
|
|
N/A
|
|
|
1,190
|
bp
|
(dollars in thousands)
|
Quarters Ended March 31,
|
|
Increase (Decrease)
|
|||||||||||
|
2017
|
|
2016
|
|
$
|
|
%
|
|||||||
Revenues
|
$
|
72,917
|
|
|
$
|
75,700
|
|
|
$
|
(2,783
|
)
|
|
(3.7
|
)%
|
Gross profit
|
8,198
|
|
|
7,471
|
|
|
727
|
|
|
9.7
|
|
|||
Gross profit margin
|
11.2
|
%
|
|
9.9
|
%
|
|
N/A
|
|
|
130
|
bp
|
|||
Operating expenses
|
6,887
|
|
|
9,350
|
|
|
(2,463
|
)
|
|
(26.3
|
)
|
|||
Restructuring charges
|
—
|
|
|
2,398
|
|
|
(2,398
|
)
|
|
(100.0
|
)
|
|||
Operating income (loss)
|
1,311
|
|
|
(4,277
|
)
|
|
5,588
|
|
|
130.7
|
|
|||
Operating margin
|
1.8
|
%
|
|
(5.6
|
)%
|
|
N/A
|
|
|
740
|
bp
|
(in thousands)
|
March 31,
2017 |
|
December 31,
2016 |
||||
Cash and cash equivalents
|
$
|
87,602
|
|
|
$
|
129,500
|
|
Restricted cash
|
1,573
|
|
|
4,892
|
|
|
|
Total Number of Shares (or Units) Purchased
|
|
Average Price Paid per Share (or Unit)
|
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
|
||||||
January 2017
(1) (2)
|
|
117,029
|
|
|
$
|
22.92
|
|
|
107,647
|
|
|
$
|
37,540,031
|
|
February 2017
(1) (2)
|
|
125,211
|
|
|
22.95
|
|
|
108,355
|
|
|
35,054,935
|
|
||
March 2017
(1) (2)
|
|
220,077
|
|
|
22.49
|
|
|
150,912
|
|
|
31,627,784
|
|
||
Total
|
|
462,317
|
|
|
$
|
22.73
|
|
|
366,914
|
|
|
|
(1)
|
In October 2016, our board of directors authorized the open market repurchase of up to $40.0 million of our common stock to be made during 2017. We began repurchasing shares under this program in January 2017. Once repurchased, we promptly retire the shares.
|
(2)
|
In connection with approval of our credit facility, our board of directors approved the purchase of up to $10.0 million of our common stock in each calendar year in connection with our equity compensation programs for employees and directors. The number of shares purchased includes shares surrendered to us to pay the exercise price and/or to satisfy tax withholding obligations in connection with “net, net” exercises of employee stock options and/or the vesting of restricted stock, restricted stock units or performance units issued to employees. For the
three
months ended
March 31, 2017
,
95,403
shares were surrendered in connection with restricted stock, restricted stock unit and performance unit transactions. The deemed price paid was the closing price of our common stock on the Nasdaq Global Select Market on the date that the restricted stock, restricted stock units or performance units vested. Once repurchased, we promptly retire the shares.
|
|
AEGION CORPORATION
|
|
|
Date: May 3, 2017
|
/s/ David A. Martin
|
|
David A. Martin
|
|
Executive Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
10.1
|
First Amendment to the Aegion Corporation Employee Equity Incentive Plan (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed March 17, 2017 in connection with the 2017 annual meeting of stockholders).
(1)
|
|
|
10.2
|
Aegion Corporation Employee Stock Purchase Plan (incorporated by reference to Appendix B to the definitive proxy statement on Schedule 14A filed March 17, 2017 in connection with the 2017 annual meeting of stockholders).
(1)
|
|
|
10.3
|
Severance Policy, effective March 15, 2017, filed herewith.
(1)
|
|
|
10.4
|
Form of Change in Control Severance Agreement, dated as of March 1, 2017, between Aegion Corporation and each of John D. Huhn, Stephen P. Callahan and Michael D. White (incorporated by reference to Exhibit 10.15 to the annual report on Form 10-K for the year ended December 31, 2016).
(1)
|
|
|
10.5
|
Management Annual Incentive Plan effective January 1, 2017 (incorporated by reference to Exhibit 10.16 to the annual report on Form 10-K for the year ended December 31, 2016).
(1)
|
|
|
10.6
|
Form of Performance Unit Agreement, dated February 22, 2017, between Aegion Corporation and certain executive officers of Aegion Corporation (incorporated by reference to Exhibit 10.18 to the annual report on Form 10-K for the year ended December 31, 2016).
(1)
|
|
|
10.7
|
Form of Restricted Stock Unit Agreement, dated February 22, 2017, between Aegion Corporation and certain executive officers of Aegion Corporation (incorporated by reference to Exhibit 10.19 to the annual report on Form 10-K for the year ended December 31, 2016).
(1)
|
|
|
10.8
|
Form of Director Deferred Stock Unit Agreement (for Non-Employee Directors), filed herewith.
(1)
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31.1
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Certification of Charles R. Gordon pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
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31.2
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Certification of David A. Martin pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
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32.1
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Certification of Charles R. Gordon pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
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32.2
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Certification of David A. Martin pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
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101.INS
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XBRL Instance Document*
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101.SCH
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XBRL Taxonomy Extension Schema Document*
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document*
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document*
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document*
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document*
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*
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In accordance with Rule 406T under Regulation S-T, the XBRL-related information in Exhibit 101 shall be deemed “furnished” and not “filed”.
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(1)
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Management contract or compensatory plan, contract or arrangement.
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(Aegion Logo)
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Policy #:
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P-HR-02
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Effective Date:
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March 15, 2017
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Subject:
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Severance Policy
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Maintained By:
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SVP of Human Resources
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Approved By:
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Compensation Committee
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Applies to:
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Aegion and/or its Subsidiaries
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Supersedes:
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March 1, 2017
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A.
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Eligibility
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B.
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Summary of Benefits
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Policy #:
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P-HR-02
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Effective Date:
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March 15, 2017
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Subject:
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Severance Policy
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Maintained By:
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SVP of Human Resources
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Approved By:
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Compensation Committee
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Applies to:
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Aegion and/or its Subsidiaries
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Supersedes:
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March 1, 2017
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•
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Tier 1 Employees.
Employees classified as Tier 1 will receive their base salary for a period of eighteen (18) months after they have satisfied all of their obligations under this Policy. In addition, they are eligible for up to $15,000 in outplacement services, provided by a vendor of the Company’s choosing. Payments for these services will be paid directly by the Company.
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•
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Tier 1.5 Employees.
Employees classified as Tier 1.5 will receive their base salary for a period of fifteen (15) months after they have satisfied all of their obligations under this Policy. In addition, they are eligible for up to $15,000 in outplacement services, provided by a vendor of the Company’s choosing. Payments for these services will be paid directly by the Company.
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•
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Tier 2.5 Employees.
Employees classified as Tier 2.5 will receive their base salary for a period of twelve (12) months after they have satisfied all of their obligations under this Policy. In addition, they are eligible for up to $10,000 in outplacement services, provided by a vendor of the Company’s choosing. Payments for these services will be paid directly by the Company.
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•
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Tiers 3.0-3.5 Employees.
Employees classified as Tiers 3.0-3.5 will receive their base salary for a period of six (6) months after they have satisfied all of their obligations under this Policy. Notwithstanding the foregoing, these employees will continue to receive base salary for the greater of (a) a period of six (6) months; or (b) a period calculated as twelve (12) weeks, plus two (2) additional weeks for each full year of continuous service time with the Company, not to exceed forty-two (42) weeks of base salary. In addition, they are eligible for up to $7,500 in outplacement services, provided by a vendor of the Company’s choosing. Payments for these services will be paid directly by the Company.
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•
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Vice Presidents who are not Tiers 1 to 3.5.
Vice presidents who are not classified as Tiers 1 - 3.5 will receive their base salary after they have satisfied all of their obligations under this Policy for a period calculated as follows: twelve (12) weeks, plus two (2) additional weeks for each full year of continuous service time with the Company. These employees will continue to receive base salary for a period of no less than twelve (12) and no more than forty-two (42) weeks. In addition, they are eligible for up to $7,500 in outplacement services, provided by a vendor of the Company’s choosing. Payments for these services will be paid directly by the Company.
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(Aegion Logo)
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Policy #:
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P-HR-02
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Effective Date:
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March 15, 2017
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Subject:
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Severance Policy
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Maintained By:
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SVP of Human Resources
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Approved By:
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Compensation Committee
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Applies to:
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Aegion and/or its Subsidiaries
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Supersedes:
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March 1, 2017
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•
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Directors who are not included in any of above classifications.
Employees who are in director-level positions will receive their base salary payments for a period calculated as follows: six (6) weeks, plus two (2) additional weeks for each full year of continuous service time with the Company. Employees in these positions will receive no less than six (6) and no more than thirty-six (36) weeks of base salary. In addition, these employees are eligible for up to $5,000 in outplacement services, provided by a vendor of the Company’s choosing. Payments for these services will be paid directly by the Company.
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•
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Salaried exempt who are not included in any of above classifications.
Salaried exempt employees (“Exempt Employees”) will receive their base salary payments for a period calculated as follows: two (2) weeks, plus one (1) additional week for each full year of continuous service time with the Company. Exempt Employees will receive no less than two (2) and no more than seventeen (17) weeks of base salary. In addition, Exempt Employees are eligible for up to $2,000 in outplacement services, provided by a vendor of the Company’s choosing.
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•
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Staff non-exempt.
Staff non-exempt employees (“Non-exempt employees”) will receive their base salary payments for a period calculated as follows: one (1) week of salary (based on forty (40) hours per week), plus one (1) additional week (based on forty (40) hours per week) for each full year of continuous service time with the Company. Non-exempt employees will receive no less than two (2) and no more than fifteen (15) weeks of base salary (based on forty (40) hours per week).
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•
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Field/Production hourly.
Hourly field/production employees (“Field Employees”) will receive severance payments based on continuous service time with the Company. The severance period will be calculated as follows, based on forty (40) hours per week:
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◦
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Completed at least two (2) to five (5) years - Two (2) weeks of base pay severance
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◦
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Completed at least five (5) to ten (10) years - Three (3) weeks of base pay severance
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◦
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Ten (10) years or more - Four (4) weeks of base pay severance
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C.
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Changes to Policy
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Policy #:
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P-HR-02
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Effective Date:
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March 15, 2017
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Subject:
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Severance Policy
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Maintained By:
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SVP of Human Resources
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Approved By:
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Compensation Committee
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||
Applies to:
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Aegion and/or its Subsidiaries
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Supersedes:
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March 1, 2017
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(Aegion Logo)
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Name:
Award Date:
Deferred Stock Units:
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1.
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I have reviewed this Quarterly Report on Form 10-Q of Aegion 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 officer(s) 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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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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/s/ Charles R. Gordon
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Charles R. Gordon
President and Chief Executive Officer
(Principal Executive Officer)
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1.
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I have reviewed this Quarterly Report on Form 10-Q of Aegion 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 officer(s) 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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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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/s/ David A. Martin
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David A. Martin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
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(1)
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the Form 10-Q 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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information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Charles R. Gordon
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Charles R. Gordon
President and Chief Executive Officer
(Principal Executive Officer)
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(1)
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the Form 10-Q 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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information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ David A. Martin
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David A. Martin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
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