x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended August 31, 2010
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Or
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period to
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Delaware
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22-3341267
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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195 Clarksville Road
Princeton Junction, New Jersey
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08550
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
o
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Accelerated filer
o
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Non-accelerated filer
x
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Smaller reporting company
o
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(Do not check if a smaller reporting company)
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PAGE
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2
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2
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3
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4
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5
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6
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19
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26
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27
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29
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29
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29
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29
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29
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29
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30
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31
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August 31, 2010
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May 31, 2010
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|||||||
ASSETS
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||||||||
Current Assets
|
||||||||
Cash and cash equivalents
|
$ | 13,855 | $ | 16,037 | ||||
Accounts receivable, net
|
51,877 | 54,721 | ||||||
Inventories, net
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8,982 | 8,736 | ||||||
Deferred income taxes
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2,272 | 2,189 | ||||||
Prepaid expenses and other current assets
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5,334 | 5,292 | ||||||
Total current assets
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82,320 | 86,975 | ||||||
Property, plant and equipment, net
|
40,469 | 39,981 | ||||||
Intangible assets, net
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17,695 | 16,088 | ||||||
Goodwill
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47,622 | 44,315 | ||||||
Other assets
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204 | 1,273 | ||||||
Total assets
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$ | 188,310 | $ | 188,632 | ||||
LIABILITIES, PREFERRED STOCK AND EQUITY
|
||||||||
Current liabilities
|
||||||||
Current portion of long-term debt
|
$ | 6,579 | $ | 6,303 | ||||
Current portion of capital lease obligations
|
5,219 | 5,370 | ||||||
Accounts payable
|
4,553 | 4,640 | ||||||
Accrued expenses and other current liabilities
|
19,263 | 20,090 | ||||||
Income taxes payable
|
2,332 | 3,281 | ||||||
Total current liabilities
|
37,946 | 39,684 | ||||||
Long-term debt, net of current portion
|
6,441 | 5,691 | ||||||
Obligations under capital leases, net of current portion
|
8,467 | 9,199 | ||||||
Deferred income taxes
|
2,032 | 2,087 | ||||||
Other long-term liabilities
|
662 | 1,417 | ||||||
Total liabilities
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55,548 | 58,078 | ||||||
Commitments and contingencies
|
||||||||
Preferred stock, 10,000,000 shares authorized
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— | — | ||||||
Equity
|
||||||||
Common stock, $0.01 par value, 200,000,000 shares authorized, 26,664,254 and 26,663,528
shares issued and outstanding as of August 31, 2010 and May 31, 2010, respectively
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267 | 267 | ||||||
Additional paid-in capital
|
162,783 | 162,054 | ||||||
Accumulated deficit
|
(28,856 | ) | (30,448 | ) | ||||
Accumulated other comprehensive loss
|
(1,797 | ) | (1,587 | ) | ||||
Total Mistras Group, Inc. stockholders’ equity
|
132,397 | 130,286 | ||||||
Noncontrolling interest
|
365 | 268 | ||||||
Total equity
|
132,762 | 130,554 | ||||||
Total liabilities, preferred stock and equity
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$ | 188,310 | $ | 188,632 |
For the three months ended August 31,
|
||||||||
2010
|
2009
|
|||||||
Revenues:
|
||||||||
Services
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$ | 61,252 | $ | 51,656 | ||||
Products
|
7,158 | 4,433 | ||||||
Total revenues
|
68,410 | 56,089 | ||||||
Cost of Revenues:
|
||||||||
Cost of services
|
41,391 | 34,369 | ||||||
Cost of goods sold
|
3,277 | 2,099 | ||||||
Depreciation of services
|
2,809 | 2,280 | ||||||
Depreciation of products
|
155 | 191 | ||||||
Total cost of revenues
|
47,632 | 38,939 | ||||||
Gross profit
|
20,778 | 17,150 | ||||||
Selling, general and administrative expenses
|
15,479 | 13,133 | ||||||
Research and engineering
|
555 | 483 | ||||||
Depreciation and amortization
|
1,178 | 1,045 | ||||||
Legal reserve
|
250 | (297 | ) | |||||
Income from operations
|
3,316 | 2,786 | ||||||
Other expenses
|
||||||||
Interest expense
|
690 | 1,064 | ||||||
Loss on extinguishment of long-term debt
|
— | 169 | ||||||
Income before provision for income taxes and noncontrolling interest
|
2,626 | 1,553 | ||||||
Provision for income taxes
|
1,054 | 694 | ||||||
Net income
|
1,572 | 859 | ||||||
Net loss (income) attributable to noncontrolling interests, net of taxes
|
20 | (44 | ) | |||||
Net income attributable to common stockholders
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$ | 1,592 | $ | 815 | ||||
Earnings per common share:
|
||||||||
Basic
|
$ | 0.06 | $ | 0.06 | ||||
Diluted
|
$ | 0.06 | $ | 0.04 | ||||
Weighted average common shares outstanding:
|
||||||||
Basic
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26,664 | 13,000 | ||||||
Diluted
|
26,778 | 20,435 |
Co mmo n Stock |
Retained
|
Accumulated
|
||||||||||||||||||||||
Additional
|
earnings
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other
|
||||||||||||||||||||||
paid-in
|
(ac
cumulated
|
comprehensive
|
Noncontrolling
|
Com
prehe
nsive
|
||||||||||||||||||||
Shares
|
Amount
|
capital
|
deficit)
|
loss
|
Interest
|
Total
|
income
(loss)
|
|||||||||||||||||
Balance at May 31, 2010
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26,664 | $ | 267 | $ | 162,054 | $ | (30,448 | ) | $ | (1,587 | ) | $ | 268 | $ | 130,554 | $ | ||||||||
Net income (loss)
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— | — | — | 1,592 | — | (20 | ) | 1,572 | 1,572 | |||||||||||||||
Foreign currency translation adjustment
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— | — | — | — | (210 | ) | — | (210 | ) | (210 | ) | |||||||||||||
Stock compensation
|
— | — | 729 | — | — | — | 729 | — | ||||||||||||||||
Noncontrolling interest in subsidiary
|
— | — | — | — | — | 117 | 117 | — | ||||||||||||||||
Balance at August 31, 2010
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26,664 | $ | 267 | $ | 162,783 | $ | (28,856 | ) | $ | (1,797 | ) | $ | 365 | $ | 132,762 | $ | 1,362 |
For the three months ended August 31,
|
||||||||
2010
|
2009
|
|||||||
Cash flows from operating activities
|
||||||||
Net income attributable to common stockholders
|
$ | 1,592 | $ | 815 | ||||
Adjustments to reconcile net income to net cash provided by operating activities
|
||||||||
Depreciation and amortization
|
4,142 | 3,516 | ||||||
Deferred income taxes
|
(24 | ) | — | |||||
Provision for doubtful accounts
|
105 | 897 | ||||||
Loss on extinguishment of long-term debt
|
— | 169 | ||||||
Gain on sale of assets
|
(9 | ) | (29 | ) | ||||
Amortization of deferred financing costs
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42 | 69 | ||||||
Stock compensation expense
|
729 | 250 | ||||||
Noncash interest rate swap
|
89 | 124 | ||||||
Net (loss) income attributable to noncontrolling interests
|
(20 | ) | 44 | |||||
Foreign currency (gain) loss
|
(17 | ) | 210 | |||||
Changes in operating assets and liabilities, net of effect of acquisitions
|
||||||||
Accounts receivable
|
3,140 | 214 | ||||||
Inventories
|
(189 | ) | 965 | |||||
Prepaid expenses and other current assets
|
(18 | ) | (436 | ) | ||||
Other assets
|
937 | (575 | ) | |||||
Accounts payable
|
281 | 1,154 | ||||||
Income taxes payable
|
(938 | ) | 452 | |||||
Accrued expenses and other current liabilities
|
(1,561 | ) | (2,356 | ) | ||||
Net cash provided by operating activities
|
8,281 | 5,483 | ||||||
Cash flows from investing activities
|
||||||||
Purchase of property, plant and equipment
|
(1,877 | ) | (1,375 | ) | ||||
Purchase of intangible assets
|
(86 | ) | (85 | ) | ||||
Acquisition of businesses, net of cash acquired
|
(5,301 | ) | (14,000 | ) | ||||
Proceeds from sale of equipment
|
24 | 102 | ||||||
Net cash used in investing activities
|
(7,240 | ) | (15,358 | ) | ||||
Cash flows from financing activities
|
||||||||
Repayment of capital lease obligations
|
(1,459 | ) | (1,425 | ) | ||||
Repayments of long-term debt
|
(1,642 | ) | (38,009 | ) | ||||
Net borrowings from revolver
|
— | 25,335 | ||||||
Proceeds from borrowings of long-term debt
|
— | 25,000 | ||||||
Debt issuance costs
|
— | (500 | ) | |||||
Net cash (used in) provided by financing activities
|
(3,101 | ) | 10,401 | |||||
Effect of exchange rate changes on cash and cash equivalents
|
(122 | ) | (159 | ) | ||||
Net change in cash and cash equivalents
|
(2,182 | ) | 367 | |||||
Cash and cash equivalents
|
||||||||
Beginning of period
|
16,037 | 5,668 | ||||||
End of period
|
$ | 13,855 | $ | 6,035 | ||||
Supplemental disclosure of cash paid
|
||||||||
Interest
|
$ | 750 | $ | 1,035 | ||||
Income taxes
|
$ | 3,530 | $ | 185 | ||||
Noncash investing and financing
|
||||||||
Equipment acquired through capital lease obligations
|
$ | 583 | $ | 1,598 | ||||
Issuance of notes payable and other debt obligations
primarily related to acquisitions
|
$ | 1,637 | $ | 4,412 |
For the three months ended August 31,
|
||||||||
2010
|
2009
|
|||||||
Dividend yield
|
0.0 | % | 0.0 | % | ||||
Expected volatility
|
44 | % | 44 | % | ||||
Risk-free interest rate
|
2.6 | % | 1.9-3.0 | % | ||||
Expected term (years)
|
6.3 | 4.0-6.3 |
Number of entities
|
2 | |||
Total cost:
|
||||
Cash paid
|
$ | 5,301 | ||
Subordinated notes issued
|
1,637 | |||
Debt assumed
|
98 | |||
$ | 7,036 | |||
Current assets acquired
|
59 | |||
Property, plant and equipment
|
1,067 | |||
Deferred tax asset
|
6 | |||
Intangibles, primarily customer lists
|
2,655 | |||
Goodwill
|
3,366 | |||
Less: noncontrolling interest
|
(117 | ) | ||
$ | 7,036 |
Useful Life
|
August 31, 2010
|
May 31, 2010
|
||||||||||
(Years)
|
||||||||||||
Land
|
$ | 2,186 | $ | 1,304 | ||||||||
Building and improvements
|
30-40 | 10,677 | 10,240 | |||||||||
Office furniture and equipment
|
5-8 | 3,543 | 1,479 | |||||||||
Machinery and equipment
|
5-7 | 68,499 | 68,238 | |||||||||
84,905 | 81,261 | |||||||||||
Accumulated depreciation and amortization
|
44,436 | 41,280 | ||||||||||
$ | 40,469 | $ | 39,981 |
Balance, May 31, 2010
|
$ | 1,661 | ||
Provision for doubtful accounts
|
105 | |||
Write-offs, net of recoveries
|
(19 | ) | ||
Foreign exchange valuation
|
7 | |||
Balance, August 31, 2010
|
$ | 1,754 |
As of
|
As of
|
|||||||
August 31, 2010
|
May 31, 2010
|
|||||||
Raw materials
|
$ | 2,595 | $ | 2,564 | ||||
Work in process
|
2,373 | 2,252 | ||||||
Finished goods
|
2,746 | 2,655 | ||||||
Supplies
|
1,268 | 1,265 | ||||||
$ | 8,982 | $ | 8,736 |
As of
|
As of
|
|||||||
August 31, 2010
|
May 31, 2010
|
|||||||
Accrued salaries, wages and related employee benefits
|
$ | 8,511 | $ | 8,158 | ||||
Other accrued expenses
|
2,675 | 2,740 | ||||||
Accrued worker compensation and health benefits
|
6,809 | 8,041 | ||||||
Deferred revenues
|
1,268 | 1,151 | ||||||
Total
|
$ | 19,263 | $ | 20,090 |
As of
|
As of
|
|||||||
August 31, 2010
|
May 31, 2010
|
|||||||
Senior credit facility:
|
||||||||
Revolver
|
$ | — | $ | — | ||||
Term loans
|
— | — | ||||||
Notes payable
|
12,149 | 11,023 | ||||||
Other
|
871 | 971 | ||||||
13,020 | 11,994 | |||||||
Less: Current maturities
|
6,579 | 6,303 | ||||||
Long-term debt, net of current maturities
|
$ | 6,441 | $ | 5,691 |
Variable
|
Fixed
|
|||||||||||||||||
Notional
|
interest
|
interest
|
As of
|
As of
|
||||||||||||||
Contract date
|
Term
|
Amount
|
rate
|
rate
|
August 31, 2010
|
May 31, 2010
|
||||||||||||
November 20, 2006
|
4 years
|
$ | 8,000 |
LIBOR
|
5.17 | % | $ | (121 | ) | $ | (210 | ) | ||||||
$ | 8,000 | $ | (121 | ) | $ | (210 | ) |
Three months ended
August 31, |
||||||||
2010
|
2009
|
|||||||
Revenues
|
||||||||
Services
|
$ | 55,282 | $ | 45,702 | ||||
Products and Systems
|
5,310 | 3,625 | ||||||
International
|
9,040 | 7,751 | ||||||
Corporate and eliminations
|
(1,222 | ) | (989 | ) | ||||
$ | 68,410 | $ | 56,089 |
Three months ended
August 31, |
||||||||
2010
|
2009
|
|||||||
Gross profit
|
||||||||
Services
|
$ | 15,001 | $ | 12,528 | ||||
Products and Systems
|
2,569 | 1,688 | ||||||
International
|
3,271 | 3,046 | ||||||
Corporate and eliminations
|
(63 | ) | (112 | ) | ||||
$ | 20,778 | $ | 17,150 | |||||
Three months ended
August 31, |
||||||||
2010 | 2009 | |||||||
Income from operations
|
||||||||
Services
|
$ | 3,848 | $ | 3,232 | ||||
Products and Systems
|
791 | (70 | ) | |||||
International
|
1,028 | 1,262 | ||||||
Corporate and eliminations
|
(2,351 | ) | (1,638 | ) | ||||
$ | 3,316 | $ | 2,786 |
Three months ended
August 31, |
||||||||
2010
|
2009
|
|||||||
Depreciation and amortization
|
||||||||
Services
|
$ | 3,584 | $ | 2,874 | ||||
Products and Systems
|
206 | 246 | ||||||
International
|
320 | 365 | ||||||
Corporate and eliminations
|
32 | 31 | ||||||
$ | 4,142 | $ | 3,516 |
As of
|
As of
|
|||||||
August 31, 2010
|
May 31, 2010
|
|||||||
Intangible assets, net
|
||||||||
Services
|
$ | 15,207 | $ | 14,042 | ||||
Products and Systems
|
1,048 | 1,016 | ||||||
International
|
930 | 504 | ||||||
Corporate and eliminations
|
510 | 526 | ||||||
$ | 17,695 | $ | 16,088 |
As of
|
As of
|
|||||||
August 31, 2010
|
May 31, 2010
|
|||||||
Goodwill
|
||||||||
Services
|
$ | 46,010 | $ | 42,804 | ||||
Products and Systems
|
— | — | ||||||
International
|
1,612 | 1,511 | ||||||
Corporate and eliminations
|
— | — | ||||||
$ | 47,622 | $ | 44,315 |
As of
|
As of
|
|||||||
August 31, 2010
|
May 31, 2010
|
|||||||
Long-lived assets
|
||||||||
Services
|
$ | 95,115 | $ | 91,040 | ||||
Products and Systems
|
3,724 | 3,837 | ||||||
International
|
5,548 | 4,957 | ||||||
Corporate and eliminations
|
1,399 | 550 | ||||||
$ | 105,786 | $ | 100,384 |
For the three months ended August 31,
|
||||||||
2010
|
2009
|
|||||||
Revenues by geographic region
|
||||||||
United States
|
$ | 54,767 | $ | 45,237 | ||||
Europe
|
6,440 | 6,387 | ||||||
Other Americas
|
4,853 | 2,926 | ||||||
Asia-Pacific
|
2,350 | 1,539 | ||||||
$ | 68,410 | $ | 56,089 |
For the three months ended August 31
,
|
||||||||
2010
|
2009
|
|||||||
(in tho usands ) | ||||||||
Statement of Operations Data
|
||||||||
Revenues
|
$ | 68,410 | $ | 56,089 | ||||
Cost of revenues
|
44,668 | 36,468 | ||||||
Depreciation
|
2,964 | 2,471 | ||||||
Gross profit
|
20,778 | 17,150 | ||||||
Selling, general and administrative expenses
|
15,479 | 13,133 | ||||||
Research and engineering
|
555 | 483 | ||||||
Depreciation and amortization
|
1,178 | 1,045 | ||||||
Legal reserve
|
250 | (297 | ) | |||||
Income from operations
|
3,316 | 2,786 | ||||||
Interest expense
|
690 | 1,064 | ||||||
Loss on extinguishment of long-term debt
|
— | 169 | ||||||
Income before provision for income taxes and
noncontrolling interest
|
2,626 | 1,553 | ||||||
Provision for income taxes
|
1,054 | 694 | ||||||
Net income
|
1,572 | 859 | ||||||
Net loss (income) attributable to noncontrolling
interests, net of taxes
|
20 | (44 | ) | |||||
Net income attributable to common stockholders
|
$ | 1,592 | $ | 815 |
For the three months ended August 31,
|
||||||||
2010
|
2009
|
|||||||
EBITDA and Adjusted EBITDA data
|
(
in thousand
s
)
|
|||||||
Net income
|
$ | 1,592 | $ | 815 | ||||
Interest expense
|
690 | 1,064 | ||||||
Provision for income taxes
|
1,054 | 694 | ||||||
Depreciation and amortization
|
4,142 | 3,516 | ||||||
EBITDA
|
$ | 7,478 | $ | 6,089 | ||||
Legal reserve
|
250 | (297 | ) | |||||
Large customer bankruptcy
|
— | 767 | ||||||
Stock compensation expense
|
729 | 250 | ||||||
Loss on extinguishment of debt
|
— | 169 | ||||||
Adjusted EBITDA
|
$ | 8,457 | $ | 6,978 |
Three months ended
August 31, |
||||||||
2010
|
2009
|
|||||||
(in thousands)
|
||||||||
Revenues
|
||||||||
Services
|
$ | 55,282 | $ | 45,702 | ||||
Products and Systems
|
5,310 | 3,625 | ||||||
International
|
9,040 | 7,751 | ||||||
Corporate and eliminations
|
(1,222 | ) | (989 | ) | ||||
$ | 68,410 | $ | 56,089 |
For the three months ended
August 31, |
||||||||
2010
|
2009
|
|||||||
Revenue growth
|
$ | 12,321 | $ | 9,092 | ||||
% Growth over prior year
|
22.0 | % | 19.3 | % | ||||
Comprised of:
|
||||||||
% of organic growth
|
14.5 | % | 10.9 | % | ||||
% of acquisition growth
|
7.9 | % | 12.2 | % | ||||
% foreign exchange decrease
|
(0.4 | %) | (3.8 | %) | ||||
22.0 | % | 19.3 | % |
For the three months ended
August 31, |
||||||||
2010
|
2009
|
|||||||
(in thousand)
|
||||||||
Gross profit
|
$ | 20,778 | $ | 17,150 | ||||
Gross profit % comprised of:
|
||||||||
Revenues
|
100.0 | % | 100.0 | % | ||||
Cost of revenues
|
65.3
|
% |
65.0
|
% | ||||
Depreciation
|
4.3 | % | 4.4 | % | ||||
Total
|
30.4 | % | 30.6 | % | ||||
Gross profit % decrease from prior year quarter
|
(0.2 | %) | (4.7 | %) |
Three months ended
August 31, |
||||||||
2010 |
2009
|
|||||||
(in thousands)
|
||||||||
Gross profit
|
||||||||
Services
|
$ | 15,001 | $ | 12,528 | ||||
Products and Systems
|
2,569 | 1,688 | ||||||
International
|
3,271 | 3,046 | ||||||
Corporate and eliminations
|
(63 | ) | (112 | ) | ||||
$ | 20,778 | $ | 17,150 |
|
Three months ended
August 31, |
|||||||
2010 | 2009 | |||||||
(in thousands)
|
||||||||
Income from operations
|
||||||||
Services
|
$ | 3,848 | $ | 3,232 | ||||
Products and Systems
|
791 | (70 | ) | |||||
International
|
1,028 | 1,262 | ||||||
Corporate and eliminations
|
(2,351 | ) | (1,638 | ) | ||||
$ | 3,316 | $ | 2,786 |
For the three months ended
August 31, |
||||||||
2010 |
2009
|
|||||||
(in thousands)
|
||||||||
Net cash provided by (used in):
|
||||||||
Operating Activities
|
$ | 8,281 | $ | 5,483 | ||||
Investing Activities
|
(7,240 | ) | (15,358 | ) | ||||
Financing Activities
|
(3,101 | ) | 10,401 | |||||
Effect of exchange rate changes on cash and cash equivalents
|
(122 | ) | (159 | ) | ||||
Net change in cash and cash equivalents
|
$ | (2,182 | ) | $ | 367 |
|
MISTRAS GROUP, INC.
|
|
|
|
|
|
By:
|
/s/
Francis T. Joyce
|
|
|
Francis T. Joyce
|
|
|
Chief Financial Officer
|
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(Principal financial officer and duly authorized officer)
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Exhibit No.
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Description
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10.1
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Amendment to Employment Agreement, dated July 14, 2010 between Sotirios J. Vahaviolos and Mistras Group, Inc.
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10.2
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Compensation Plan for Non-Employee Directors (July 2010)
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31.1
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Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
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31.2
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Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.
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32.1
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Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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MISTRAS GROUP, INC. | ||
By:
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/s/ Michael C. Keefe
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Name:
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Michael C. Keefe
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Title:
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Executive Vice President, General
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Counsel and Secretary
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/s/ Sotirios J. Vahaviolos
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Sotirios J. Vahaviolos
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Eligible Participants:
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Members of the Mistras Group Board of Directors who are not employees of the Company
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Annual Retainer:
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$20,000 per year, payable quarterly at the beginning of each fiscal quarter, beginning the first quarter of fiscal 2011
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Committee Chair Fees:
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Each Committee Chairperson shall receive the following annual fees, which shall be paid quarterly with the annual retainer:
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Audit Committee: $10,000
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Compensation Committee: $7,500
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Corporate Governance Committee: $7,500
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Annual Equity Award:
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$20,000 of restricted stock award under the Mistras 2009 Long-Term Incentive Plan (“LTIP”), to be issued in the first fiscal quarter. The number of shares shall be based upon the fair market value of Mistras common stock as of the grant date, in accordance with the LTIP. The shares shall vest 25% per year on each anniversary date of the award. If a director is elected to the Board after the grant, the director will receive a pro rata award based upon number quarters remaining in the fiscal year.
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I, Sotirios J. Vahaviolos, certify that:
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1.
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I have reviewed this report on Form 10-Q of Mistras Group, Inc.;
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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 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 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 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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/s/ Sotirios J. Vahaviolos
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Sotirios J. Vahaviolos
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Chief Executive Officer
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I, Francis T. Joyce, certify that:
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1.
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I have reviewed this report on Form 10-Q of Mistras Group, Inc.;
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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 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 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 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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/s/ Francis T. Joyce
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Francis T. Joyce
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Chief Financial Officer
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/s/ Sotirios J. Vahaviolos
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Sotirios J. Vahaviolos
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Chief Executive Officer
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/s/ Francis T. Joyce
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Francis T. Joyce
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Chief Financial Officer
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Mistra Group, Inc. |