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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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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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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 Number)
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $.01 par value
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New York Stock Exchange
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Large accelerated filer
o
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Accelerated filer
x
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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•
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Field Inspections
|
•
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Consulting
|
•
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Maintenance
|
•
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Data Management
|
•
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Access
|
•
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Monitoring
|
•
|
Laboratory Quality Assurance/Control (QA/QC)
|
•
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Equipment
|
•
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Oil & Gas (Downstream, Midstream, Upstream and Petrochemical)
|
•
|
Aerospace & Defense
|
•
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Industrial
|
•
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Power Generation and Transmission
|
•
|
Public Infrastructure, Research and Engineering
|
•
|
Process Industries
|
•
|
Comprehensive inspection tracking, scheduling and analysis
|
•
|
Corrosion analysis & trending
|
•
|
Integrated risk-based inspection (RBI) calculators
|
•
|
Safety relief valve management
|
•
|
Bridge Structural Health Monitoring (SHM)
|
•
|
Power Transformer Health & Reliability
|
•
|
Stator Vane Cracking
|
•
|
Through-Valve Leaking
|
•
|
Tube Leaking
|
•
|
Wall Thickness Tracking
|
•
|
Non-destructive testing (NDT)
|
•
|
Destructive testing (DT)
|
•
|
Metallurgical testing
|
•
|
Chemical analysis testing
|
•
|
Mechanical services
|
•
|
Pre-machining
|
•
|
Finishing services
|
•
|
Acoustic Emission
|
•
|
Aerospace
|
•
|
American Petroleum Institute (API) Turnarounds
|
•
|
AIMS/MI/Engineering
|
•
|
Automated Ultrasonics
|
•
|
Fossil Power
|
•
|
Guided Wave Ultrasonics
|
•
|
Infrastructure
|
•
|
PCMS Software & Services
|
•
|
Mechanical Services
|
•
|
Nuclear Power
|
•
|
Offshore
|
•
|
Phased Array
|
•
|
Pipeline
|
•
|
Power Generation
|
•
|
Predictive Maintenance
|
•
|
Refractory Inspection
|
•
|
Rope Access/Wind
|
•
|
Substation Reliability
|
•
|
Tank Inspection
|
•
|
Transportation
|
•
|
Tube Inspection
|
•
|
Unmanned Systems
|
•
|
The approximately decade-long backlog for next generation commercial aircraft to be built, including several large and mid-sized aircraft built by Boeing, Airbus, Bombardier and Embraer, among other manufacturers;
|
•
|
The backlog of next generation aircraft engines which operate with greater fuel efficiency, including the LEAP engine and the geared-turbo fan engine;
|
•
|
The continuing regulatory scrutiny to ensure public safety associated with these new technologically advanced aircraft, which serves to ensure the continued need for inspection and mechanical services to be performed, as well as to limit the number of participants who can meet the demanding requirements associated with performing these services.
|
•
|
Testing of new composites
|
•
|
Detecting crack propagation
|
•
|
Wireless and communications technologies
|
•
|
Development of permanently embedded inspection systems to provide continuous, online, in-service monitoring of critical structural components
|
•
|
One Source for Asset Protection Solutions
®
|
•
|
PCMS
®
|
•
|
Physical Acoustics and the PAC logo
|
•
|
Streamview™
|
•
|
Ropeworks
®
|
•
|
Sensor Highway™
|
•
|
Streamview
|
•
|
TankPAC
®
|
•
|
CALIPERAY™
|
•
|
VPAC
|
•
|
Transformer Clinic™
|
Name
|
|
Age
|
|
Position
|
Sotirios J. Vahaviolos
|
|
72
|
|
Executive Chairman and Director
|
Dennis Bertolotti
|
|
59
|
|
President, Chief Executive Officer and Director
|
Edward J. Prajzner
|
|
52
|
|
Senior Vice President, Chief Financial Officer and Treasurer
|
Michael C. Keefe
|
|
62
|
|
Executive Vice President, General Counsel and Secretary
|
Michael J. Lange
|
|
58
|
|
Vice Chairman, Senior Executive Vice President of Global Business Development, Marketing & Strategic Planning, and Director
|
Jonathan H. Wolk
|
|
57
|
|
Senior Executive Vice President and Chief Operating Officer
|
•
|
whether we successfully identify suitable acquisition candidates, negotiate appropriate acquisition terms, and complete proposed acquisitions;
|
•
|
whether we can successfully integrate acquired businesses into our current operations, including our accounting, internal control and information technology systems, marketing and other key infrastructure;
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•
|
whether we can adequately capture opportunities that an acquired business may offer, including the expansion into new markets in which we have little to no experience or presence;
|
•
|
whether we value an acquired business properly when determining the purchase price and terms, and whether we are able to achieve the returns on the investment we expect;
|
•
|
whether an acquired business can achieve levels of revenues, profitability, productivity or cost savings we expect;
|
•
|
whether an acquired business is compatible with our culture and philosophy of doing business;
|
•
|
the unexpected loss of key personnel and customers of an acquired business;
|
•
|
the assumption of liabilities and risks (including environmental-related costs) of an acquired business, some of which may not be anticipated;
|
•
|
the potential disruption of our ongoing business and distraction of management and other personnel of us and the acquired business resulting from the efforts to acquire, then integrate, an acquired business;
|
•
|
the potential for greater exposure to risks associated with international operations; and
|
•
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the amount and cost of funding (including borrowings under our credit agreement) to acquire and integrate other businesses (some of which may require substantial funding) and the impact of the acquisition and borrowing on our continued compliance with covenants in our credit agreement.
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•
|
fluctuations in currency exchange rates and interest rates;
|
•
|
varying regional and geopolitical business and economic conditions and demands;
|
•
|
compliance with applicable foreign regulations and licensing requirements, and U.S. laws and regulation with respect to our business in other countries, including export controls and anti-bribery laws;
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•
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the cost and uncertainty of obtaining data and creating solutions that are relevant to particular geographic markets;
|
•
|
the need to provide sufficient levels of technical support in different locations;
|
•
|
the complexity of maintaining effective policies and procedures in locations around the world;
|
•
|
political instability and civil unrest;
|
•
|
restrictions or limitations on outsourcing contracts or services abroad;
|
•
|
the impact of the United Kingdom exiting the European Union; the ultimate effects of Brexit on the Company are difficult to predict. The Company currently has subsidiaries that operate in the United Kingdom and Europe and our UK subsidiary and other European subsidiaries from time to time share employees and equipment. Brexit will make this sharing of employees and equipment more time consuming and expensive, which could cause disruptions and adversely affect the Company’s financial condition, operating results and cash flows.
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•
|
restrictions or limitations on the repatriation of funds, or tax consequences on the non-repatriation of overseas operationally generated funds; and
|
•
|
other potentially adverse tax consequences.
|
•
|
our ability to integrate our technology with new and existing hardware and software systems;
|
•
|
our ability to anticipate and support new standards, especially internet-based standards; and
|
•
|
our ability to integrate additional software modules under development with our existing technology and operational processes.
|
•
|
allow the authorized number of directors to be changed only by resolution of our board of directors;
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•
|
require that vacancies on the board of directors, including newly created directorships, be filled only by a majority vote of directors then in office;
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•
|
authorize our board of directors to issue, without stockholder approval, preferred stock that, if issued, could operate as a “poison pill” to dilute the stock ownership of a potential hostile acquirer to prevent an acquisition that is not approved by our board of directors;
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•
|
require that stockholder actions must be effected at a duly called stockholder meeting by prohibiting stockholder action by written consent;
|
•
|
prohibit cumulative voting in the election of directors, which may otherwise allow holders of less than a majority of stock to elect some directors; and
|
•
|
establish advance notice requirements for stockholder nominations to our board of directors or for stockholder proposals that can be acted on at stockholder meetings and limit the right to call special meetings of stockholders to the Chairman of the Board, the Chief Executive Officer, the board of directors acting pursuant to a resolution adopted by a majority of directors or the Secretary upon the written request of stockholders entitled to cast not less than 35% of all the votes entitled to be cast at such meeting.
|
Month Ending
|
|
Total Number of
Shares (or Units)
Purchased
|
|
Average Price Paid
per Share (or Unit)
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
(1)
|
|||||
October 31, 2018
|
|
33,585
|
|
$
|
19.59
|
|
|
—
|
|
|
$
|
25,081,657
|
|
November 30, 2018
|
|
5,067
|
|
$
|
16.92
|
|
|
—
|
|
|
$
|
25,081,657
|
|
December 31, 2018
|
|
2,730
|
|
$
|
14.38
|
|
|
—
|
|
|
$
|
25,081,657
|
|
|
|
For the year ended December 31,
|
|
For the Transition period ended
|
|
For the year ended May 31,
|
||||||||||||||||||
|
|
2018 (1)
|
|
2017 (2)
|
|
December 31, 2016 (3)
|
|
2016 (4)
|
|
2015 (4)
|
|
2014 (4)
|
||||||||||||
|
|
|
|
($ in thousands, except per share data)
|
||||||||||||||||||||
Statement of Income Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Revenues
|
|
$
|
742,354
|
|
|
$
|
700,970
|
|
|
$
|
404,161
|
|
|
$
|
719,181
|
|
|
$
|
711,252
|
|
|
$
|
623,447
|
|
Gross profit
|
|
207,874
|
|
|
187,712
|
|
|
117,004
|
|
|
203,008
|
|
|
184,733
|
|
|
172,943
|
|
||||||
Income from operations
|
|
22,221
|
|
|
4,160
|
|
|
17,533
|
|
|
43,177
|
|
|
30,353
|
|
|
38,295
|
|
||||||
Net income (loss) attributable to Mistras Group, Inc.
|
|
$
|
6,836
|
|
|
$
|
(2,175
|
)
|
|
$
|
9,568
|
|
|
$
|
24,654
|
|
|
$
|
16,081
|
|
|
$
|
22,518
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Per Share Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Basic
|
|
28,406
|
|
|
28,422
|
|
|
28,989
|
|
|
28,856
|
|
|
28,613
|
|
|
28,365
|
|
||||||
Diluted
|
|
29,427
|
|
|
28,422
|
|
|
30,125
|
|
|
29,891
|
|
|
29,590
|
|
|
29,324
|
|
||||||
Earnings (loss) per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Basic
|
|
$
|
0.24
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.33
|
|
|
$
|
0.85
|
|
|
$
|
0.56
|
|
|
$
|
0.79
|
|
Diluted
|
|
$
|
0.23
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.32
|
|
|
$
|
0.82
|
|
|
$
|
0.54
|
|
|
$
|
0.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Cash and cash equivalents
|
|
$
|
25,544
|
|
|
$
|
27,541
|
|
|
$
|
19,154
|
|
|
$
|
21,188
|
|
|
$
|
10,555
|
|
|
$
|
10,020
|
|
Total assets
|
|
694,037
|
|
|
554,441
|
|
|
469,427
|
|
|
482,675
|
|
|
471,727
|
|
|
443,972
|
|
||||||
Total long-term debt and obligations under capital leases, including current portion
|
|
303,617
|
|
|
181,491
|
|
|
103,466
|
|
|
104,776
|
|
|
132,822
|
|
|
97,563
|
|
||||||
Total Mistras Group, Inc. stockholders’ equity
|
|
$
|
270,897
|
|
|
$
|
270,619
|
|
|
$
|
270,582
|
|
|
$
|
276,163
|
|
|
$
|
244,819
|
|
|
$
|
242,104
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash Flow Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net cash provided by operating activities
|
|
$
|
41,664
|
|
|
$
|
55,799
|
|
|
$
|
30,259
|
|
|
$
|
68,124
|
|
|
$
|
49,840
|
|
|
$
|
36,873
|
|
Net cash used in investing activities
|
|
(155,450
|
)
|
|
(102,797
|
)
|
|
(17,374
|
)
|
|
(16,752
|
)
|
|
(49,651
|
)
|
|
(38,005
|
)
|
||||||
Net cash (used in) provided by financing activities
|
|
113,969
|
|
|
53,045
|
|
|
(12,869
|
)
|
|
(40,378
|
)
|
|
2,066
|
|
|
3,262
|
|
•
|
Forward-Looking Statements
|
•
|
Overview
|
•
|
Consolidated Results of Operations
|
•
|
Liquidity and Capital Resources
|
•
|
Critical Accounting Estimates
|
•
|
Recent Accounting Pronouncements
|
•
|
Services
provides asset protection solutions predominantly in North America, with the largest concentration in the United States, followed by Canada, consisting primarily of NDT, inspection, mechanical and engineering services that are used to evaluate the structural integrity and reliability of critical energy, industrial and public infrastructure.
|
•
|
International
offers services, products and systems similar to those of the other segments to select markets within Europe, the Middle East, Africa, Asia and South America, but not to customers in China and South Korea, which are served by the Products and Systems segment.
|
•
|
Products and Systems
designs, manufactures, sells, installs and services the Company’s asset protection products and systems, including equipment and instrumentation, predominantly in the United States.
|
|
|
For the year ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
($ in thousands)
|
||||||
Revenues
|
|
$
|
742,354
|
|
|
$
|
700,970
|
|
Gross profit
|
|
207,874
|
|
|
187,712
|
|
||
Gross profit as a % of Revenue
|
|
28
|
%
|
|
27
|
%
|
||
Total operating expenses
|
|
185,653
|
|
|
183,552
|
|
||
Operating expenses as a % of Revenue
|
|
25
|
%
|
|
26
|
%
|
||
Income from operations
|
|
22,221
|
|
|
4,160
|
|
||
Income from operations as a % of Revenue
|
|
3
|
%
|
|
1
|
%
|
||
Interest expense
|
|
7,950
|
|
|
4,386
|
|
||
Income (loss) before provision for income taxes
|
|
14,271
|
|
|
(226
|
)
|
||
Provision for income taxes
|
|
7,426
|
|
|
1,942
|
|
||
Net income (loss)
|
|
6,845
|
|
|
(2,168
|
)
|
||
Less: net income attributable to noncontrolling interests, net of taxes
|
|
9
|
|
|
7
|
|
||
Net income (loss) attributable to Mistras Group, Inc.
|
|
$
|
6,836
|
|
|
$
|
(2,175
|
)
|
|
|
For the year ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
($ in thousands)
|
||||||
Revenues
|
|
|
|
|
|
|||
Services
|
|
$
|
574,619
|
|
|
$
|
543,565
|
|
International
|
|
153,448
|
|
|
144,265
|
|
||
Products and Systems
|
|
23,426
|
|
|
23,297
|
|
||
Corporate and eliminations
|
|
(9,139
|
)
|
|
(10,157
|
)
|
||
|
|
$
|
742,354
|
|
|
$
|
700,970
|
|
|
|
For the year ended December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
($ in thousands)
|
||||||
Gross profit
|
|
|
|
|
|
|||
Services
|
|
$
|
151,974
|
|
|
$
|
139,160
|
|
% of segment revenue
|
|
26.4
|
%
|
|
25.6
|
%
|
||
International
|
|
45,464
|
|
|
38,974
|
|
||
% of segment revenue
|
|
29.6
|
%
|
|
27.0
|
%
|
||
Products and Systems
|
|
10,560
|
|
|
9,798
|
|
||
% of segment revenue
|
|
45.1
|
%
|
|
42.1
|
%
|
||
Corporate and eliminations
|
|
(124
|
)
|
|
(220
|
)
|
||
|
|
$
|
207,874
|
|
|
$
|
187,712
|
|
% of total revenue
|
|
28.0
|
%
|
|
26.8
|
%
|
|
For the year ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
($ in thousands)
|
||||||
Services:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
$
|
47,126
|
|
|
$
|
46,677
|
|
Pension withdrawal expense
|
5,886
|
|
|
—
|
|
||
Bad debt provision for troubled customers
|
650
|
|
|
1,200
|
|
||
Reorganization and other costs
|
458
|
|
|
684
|
|
||
Acquisition-related expense, net
|
576
|
|
|
392
|
|
||
Income before special items (non-GAAP)
|
54,696
|
|
|
48,953
|
|
||
|
|
|
|
||||
International:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
3,953
|
|
|
3,537
|
|
||
Reorganization and other costs
|
3,966
|
|
|
1,055
|
|
||
Acquisition-related (benefit), net
|
(409
|
)
|
|
(501
|
)
|
||
Income before special items (non-GAAP)
|
7,510
|
|
|
4,091
|
|
||
|
|
|
|
||||
Products and Systems:
|
|
|
|
|
|||
Income (loss) from operations (GAAP)
|
2,368
|
|
|
(16,991
|
)
|
||
Impairment charges
|
—
|
|
|
15,810
|
|
||
Gain on sale of subsidiary
|
(2,384
|
)
|
|
—
|
|
||
Reorganization and other costs
|
29
|
|
|
18
|
|
||
Income (loss) before special items (non-GAAP)
|
13
|
|
|
(1,163
|
)
|
||
|
|
|
|
||||
Corporate and Eliminations:
|
|
|
|
|
|
||
Loss from operations (GAAP)
|
(31,226
|
)
|
|
(29,063
|
)
|
||
Litigation charges
|
—
|
|
|
1,600
|
|
||
Reorganization and other costs
|
305
|
|
|
184
|
|
||
Acquisition-related expense, net
|
365
|
|
|
591
|
|
||
Loss before special items (non-GAAP)
|
(30,556
|
)
|
|
(26,688
|
)
|
||
|
|
|
|
||||
Total Company:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
$
|
22,221
|
|
|
$
|
4,160
|
|
Litigation charges
|
—
|
|
|
1,600
|
|
||
Pension withdrawal expense
|
5,886
|
|
|
—
|
|
||
Gain on sale of subsidiary
|
(2,384
|
)
|
|
—
|
|
||
Impairment charges
|
—
|
|
|
15,810
|
|
||
Bad debt provision for troubled customers
|
650
|
|
|
1,200
|
|
||
Reorganization and other costs
|
4,758
|
|
|
1,941
|
|
||
Acquisition-related expense, net
|
532
|
|
|
482
|
|
||
Income before special items (non-GAAP)
|
$
|
31,663
|
|
|
$
|
25,193
|
|
|
|
For the year ended December 31,
|
||||||
|
|
2017
|
|
2016 (unaudited)
|
||||
|
|
($ in thousands)
|
||||||
Revenues
|
|
$
|
700,970
|
|
|
$
|
684,762
|
|
Gross profit
|
|
187,712
|
|
|
194,134
|
|
||
Gross profit as a % of Revenue
|
|
27
|
%
|
|
28
|
%
|
||
Total operating expenses
|
|
183,552
|
|
|
168,588
|
|
||
Operating expenses as a % of Revenue
|
|
26
|
%
|
|
25
|
%
|
||
Income from operations
|
|
4,160
|
|
|
25,546
|
|
||
Income from operations as a % of Revenue
|
|
1
|
%
|
|
4
|
%
|
||
Interest expense
|
|
4,386
|
|
|
3,075
|
|
||
(Loss) income before provision for income taxes
|
|
(226
|
)
|
|
22,471
|
|
||
Provision for income taxes
|
|
1,942
|
|
|
8,008
|
|
||
Net (loss) income
|
|
(2,168
|
)
|
|
14,463
|
|
||
Less: net income attributable to noncontrolling interests, net of taxes
|
|
7
|
|
|
54
|
|
||
Net (loss) income attributable to Mistras Group, Inc.
|
|
$
|
(2,175
|
)
|
|
$
|
14,409
|
|
|
|
For the year ended December 31,
|
||||||
|
|
2017
|
|
2016 (unaudited)
|
||||
|
|
($ in thousands)
|
||||||
Revenues
|
|
|
|
|
|
|||
Services
|
|
$
|
543,565
|
|
|
$
|
519,378
|
|
International
|
|
144,265
|
|
|
148,761
|
|
||
Products and Systems
|
|
23,297
|
|
|
26,049
|
|
||
Corporate and eliminations
|
|
(10,157
|
)
|
|
(9,426
|
)
|
||
|
|
$
|
700,970
|
|
|
$
|
684,762
|
|
|
|
For the year ended December 31,
|
||||||
|
|
2017
|
|
2016 (unaudited)
|
||||
|
|
($ in thousands)
|
||||||
Gross profit
|
|
|
|
|
|
|||
Services
|
|
$
|
139,160
|
|
|
$
|
133,532
|
|
% of segment revenue
|
|
25.6
|
%
|
|
25.7
|
%
|
||
International
|
|
38,974
|
|
|
48,372
|
|
||
% of segment revenue
|
|
27.0
|
%
|
|
32.5
|
%
|
||
Products and Systems
|
|
9,798
|
|
|
11,956
|
|
||
% of segment revenue
|
|
42.1
|
%
|
|
45.9
|
%
|
||
Corporate and eliminations
|
|
(220
|
)
|
|
274
|
|
||
|
|
$
|
187,712
|
|
|
$
|
194,134
|
|
% of total revenue
|
|
26.8
|
%
|
|
28.4
|
%
|
|
For the year ended December 31,
|
||||||
|
2017
|
|
2016 (unaudited)
|
||||
|
($ in thousands)
|
||||||
Services:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
$
|
46,677
|
|
|
$
|
37,788
|
|
Litigation charges
|
—
|
|
|
6,320
|
|
||
Bad debt provision for a customer bankruptcy
|
1,200
|
|
|
—
|
|
||
Severance costs
|
684
|
|
|
77
|
|
||
Asset write-offs and lease terminations
|
—
|
|
|
—
|
|
||
Acquisition-related (benefit) expense, net
|
392
|
|
|
(232
|
)
|
||
Income before special items (non-GAAP)
|
48,953
|
|
|
43,953
|
|
||
|
|
|
|
||||
International:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
3,537
|
|
|
12,908
|
|
||
Severance costs
|
1,055
|
|
|
1,184
|
|
||
Asset write-offs and lease terminations
|
—
|
|
|
1,042
|
|
||
Acquisition-related (benefit) expense, net
|
(501
|
)
|
|
(42
|
)
|
||
Income before special items (non-GAAP)
|
4,091
|
|
|
15,092
|
|
||
|
|
|
|
||||
Products and Systems:
|
|
|
|
|
|||
Loss from operations (GAAP)
|
(16,991
|
)
|
|
(180
|
)
|
||
Impairment charges
|
15,810
|
|
|
—
|
|
||
Severance costs
|
18
|
|
|
31
|
|
||
Loss before special items (non-GAAP)
|
(1,163
|
)
|
|
(149
|
)
|
||
|
|
|
|
||||
Corporate and Eliminations:
|
|
|
|
|
|
||
Loss from operations (GAAP)
|
(29,063
|
)
|
|
(24,970
|
)
|
||
Litigation charges
|
1,600
|
|
|
—
|
|
||
Severance costs
|
184
|
|
|
133
|
|
||
Acquisition-related expense (benefit), net
|
591
|
|
|
269
|
|
||
Loss before special items (non-GAAP)
|
(26,688
|
)
|
|
(24,568
|
)
|
||
|
|
|
|
||||
Total Company:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
$
|
4,160
|
|
|
$
|
25,546
|
|
Litigation charges
|
1,600
|
|
|
6,320
|
|
||
Impairment charges
|
15,810
|
|
|
—
|
|
||
Bad debt provision for a customer bankruptcy
|
1,200
|
|
|
—
|
|
||
Severance costs
|
1,941
|
|
|
1,425
|
|
||
Asset write-offs and lease terminations
|
—
|
|
|
1,042
|
|
||
Acquisition-related (benefit) expense, net
|
482
|
|
|
(5
|
)
|
||
Income before special items (non-GAAP)
|
$
|
25,193
|
|
|
$
|
34,328
|
|
|
|
For the Transition period ended December 31,
|
||||||
|
|
2016
|
|
2015 (unaudited)
|
||||
|
|
($ in thousands)
|
||||||
Revenues
|
|
$
|
404,161
|
|
|
$
|
427,913
|
|
Gross profit
|
|
117,004
|
|
|
123,190
|
|
||
Gross profit as a % of Revenue
|
|
29
|
%
|
|
29
|
%
|
||
Total operating expenses
|
|
99,471
|
|
|
88,092
|
|
||
Operating expenses as a % of Revenue
|
|
25
|
%
|
|
21
|
%
|
||
Income from operations
|
|
17,533
|
|
|
35,098
|
|
||
Income from operations as a % of Revenue
|
|
4
|
%
|
|
8
|
%
|
||
Interest expense
|
|
2,052
|
|
|
3,672
|
|
||
Income before provision for income taxes
|
|
15,481
|
|
|
31,426
|
|
||
Provision for income taxes
|
|
5,870
|
|
|
11,627
|
|
||
Net income
|
|
9,611
|
|
|
19,799
|
|
||
Less: net income (loss) attributable to noncontrolling interests, net of taxes
|
|
43
|
|
|
(15
|
)
|
||
Net income attributable to Mistras Group, Inc.
|
|
$
|
9,568
|
|
|
$
|
19,814
|
|
|
|
For the Transition period ended December 31,
|
||||||
|
|
2016
|
|
2015 (unaudited)
|
||||
|
|
($ in thousands)
|
||||||
Revenues
|
|
|
|
|
|
|||
Services
|
|
$
|
293,218
|
|
|
$
|
327,118
|
|
International
|
|
104,013
|
|
|
87,411
|
|
||
Products and Systems
|
|
14,541
|
|
|
18,786
|
|
||
Corporate and eliminations
|
|
(7,611
|
)
|
|
(5,402
|
)
|
||
|
|
$
|
404,161
|
|
|
$
|
427,913
|
|
|
|
For the Transition period ended December 31,
|
||||||
|
|
2016
|
|
2015 (unaudited)
|
||||
|
|
($ in thousands)
|
||||||
Gross profit
|
|
|
|
|
|
|||
Services
|
|
$
|
75,784
|
|
|
$
|
87,514
|
|
% of segment revenue
|
|
25.8
|
%
|
|
26.8
|
%
|
||
International
|
|
34,210
|
|
|
26,762
|
|
||
% of segment revenue
|
|
32.9
|
%
|
|
30.6
|
%
|
||
Products and Systems
|
|
6,920
|
|
|
8,986
|
|
||
% of segment revenue
|
|
47.6
|
%
|
|
47.8
|
%
|
||
Corporate and eliminations
|
|
90
|
|
|
(72
|
)
|
||
|
|
$
|
117,004
|
|
|
123,190
|
|
|
% of total revenue
|
|
28.9
|
%
|
|
28.8
|
%
|
|
For the transition period ended December 31,
|
||||||
|
2016
|
|
2015 (unaudited)
|
||||
|
($ in thousands)
|
||||||
Services:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
$
|
22,411
|
|
|
$
|
37,175
|
|
Severance costs
|
77
|
|
|
188
|
|
||
Acquisition-related expense (benefit), net
|
236
|
|
|
(593
|
)
|
||
Income before special items (non-GAAP)
|
22,724
|
|
|
36,770
|
|
||
|
|
|
|
||||
International:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
10,597
|
|
|
6,888
|
|
||
Severance costs
|
474
|
|
|
175
|
|
||
Asset write-offs and lease terminations
|
1,042
|
|
|
—
|
|
||
Acquisition-related expense (benefit), net
|
29
|
|
|
(457
|
)
|
||
Income before special items (non-GAAP)
|
12,142
|
|
|
6,606
|
|
||
|
|
|
|
||||
Products and Systems:
|
|
|
|
|
|||
(Loss) income from operations (GAAP)
|
(254
|
)
|
|
2,613
|
|
||
Severance costs
|
14
|
|
|
17
|
|
||
(Loss) income before special items (non-GAAP)
|
(240
|
)
|
|
2,630
|
|
||
|
|
|
|
||||
Corporate and Eliminations:
|
|
|
|
|
|
||
Loss from operations (GAAP)
|
(15,221
|
)
|
|
(11,578
|
)
|
||
Severance costs
|
133
|
|
|
—
|
|
||
Acquisition-related expense (benefit), net
|
231
|
|
|
91
|
|
||
Loss before special items (non-GAAP)
|
(14,857
|
)
|
|
(11,487
|
)
|
||
|
|
|
|
||||
Total Company:
|
|
|
|
|
|
||
Income from operations (GAAP)
|
$
|
17,533
|
|
|
$
|
35,098
|
|
Severance costs
|
698
|
|
|
380
|
|
||
Asset write-offs and lease terminations
|
1,042
|
|
|
—
|
|
||
Acquisition-related expense (benefit), net
|
496
|
|
|
(959
|
)
|
||
Income before special items (non-GAAP)
|
$
|
19,769
|
|
|
$
|
34,519
|
|
|
|
For the year ended December 31,
|
|
For the Transition period ended December 31,
|
|
For the year ended May 31,
|
||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2016
|
|
2016
|
||||||||||
($ in thousands)
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
||||||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating activities
|
|
$
|
41,664
|
|
|
$
|
55,799
|
|
|
$
|
63,211
|
|
|
$
|
30,259
|
|
|
$
|
68,124
|
|
Investing activities
|
|
(155,450
|
)
|
|
(102,797
|
)
|
|
(22,408
|
)
|
|
(17,374
|
)
|
|
(16,752
|
)
|
|||||
Financing activities
|
|
113,969
|
|
|
53,045
|
|
|
(30,031
|
)
|
|
(12,869
|
)
|
|
(40,378
|
)
|
|||||
Effect of exchange rate changes on cash
|
|
(2,180
|
)
|
|
2,340
|
|
|
(1,217
|
)
|
|
(2,050
|
)
|
|
(361
|
)
|
|||||
Net change in cash and cash equivalents
|
|
$
|
(1,997
|
)
|
|
$
|
8,387
|
|
|
$
|
9,555
|
|
|
$
|
(2,034
|
)
|
|
$
|
10,633
|
|
($ in thousands)
|
|
Total
|
|
December 31, 2019
|
|
December 31, 2020
|
|
December 31, 2021
|
|
December 31, 2022
|
|
December 31, 2023
|
|
Thereafter
|
||||||||||||||
Long-term debt (1)
|
|
$
|
290,620
|
|
|
$
|
6,831
|
|
|
$
|
6,515
|
|
|
$
|
8,750
|
|
|
$
|
11,030
|
|
|
$
|
255,043
|
|
|
$
|
2,451
|
|
Capital lease obligations (2)
|
|
13,987
|
|
|
4,686
|
|
|
3,489
|
|
|
2,757
|
|
|
1,475
|
|
|
807
|
|
|
773
|
|
|||||||
Operating lease obligations
|
|
45,762
|
|
|
10,939
|
|
|
8,764
|
|
|
6,327
|
|
|
4,826
|
|
|
4,239
|
|
|
10,667
|
|
|||||||
Contingent consideration obligations (3)
|
|
2,365
|
|
|
1,687
|
|
|
678
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Purchase commitments (4)
|
|
2,145
|
|
|
—
|
|
|
—
|
|
|
2,145
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total
|
|
$
|
354,879
|
|
|
$
|
24,143
|
|
|
$
|
19,446
|
|
|
$
|
19,979
|
|
|
$
|
17,331
|
|
|
$
|
260,089
|
|
|
$
|
13,891
|
|
(1)
|
Consists primarily of the principal portion of borrowings from our senior credit facility and seller notes payable in connection with our acquisitions and includes the current portion outstanding.
|
(2)
|
Includes estimated cash interest to be paid over the remaining terms of the leases.
|
(3)
|
Consists of payments deemed reasonably likely to occur in connection with our acquisitions.
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
ASSETS
|
|
|
|
||||
Current Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
25,544
|
|
|
$
|
27,541
|
|
Accounts receivable, net
|
148,324
|
|
|
138,080
|
|
||
Inventories
|
13,053
|
|
|
10,503
|
|
||
Prepaid expenses and other current assets
|
15,870
|
|
|
18,884
|
|
||
Total current assets
|
202,791
|
|
|
195,008
|
|
||
Property, plant and equipment, net
|
93,895
|
|
|
87,143
|
|
||
Intangible assets, net
|
111,395
|
|
|
63,739
|
|
||
Goodwill
|
279,259
|
|
|
203,438
|
|
||
Deferred income taxes
|
1,930
|
|
|
1,606
|
|
||
Other assets
|
4,767
|
|
|
3,507
|
|
||
Total Assets
|
$
|
694,037
|
|
|
$
|
554,441
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current Liabilities
|
|
|
|
||||
Accounts payable
|
$
|
13,863
|
|
|
$
|
10,362
|
|
Accrued expenses and other current liabilities
|
73,895
|
|
|
65,561
|
|
||
Current portion of long-term debt
|
6,833
|
|
|
2,358
|
|
||
Current portion of capital lease obligations
|
3,922
|
|
|
5,875
|
|
||
Income taxes payable
|
1,958
|
|
|
6,069
|
|
||
Total current liabilities
|
100,471
|
|
|
90,225
|
|
||
Long-term debt, net of current portion
|
283,787
|
|
|
164,520
|
|
||
Obligations under capital leases, net of current portion
|
9,075
|
|
|
8,738
|
|
||
Deferred income taxes
|
23,148
|
|
|
8,803
|
|
||
Other long-term liabilities
|
6,482
|
|
|
11,363
|
|
||
Total Liabilities
|
422,963
|
|
|
283,649
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
||||
|
|
|
|
||||
Equity
|
|
|
|
||||
Preferred stock, 10,000,000 shares authorized
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value, 200,000,000 shares authorized, 28,562,608 and 28,294,968 shares issued
|
285
|
|
|
282
|
|
||
Additional paid-in capital
|
226,616
|
|
|
222,425
|
|
||
Retained earnings
|
71,553
|
|
|
64,717
|
|
||
Accumulated other comprehensive loss
|
(27,557
|
)
|
|
(16,805
|
)
|
||
Total Mistras Group, Inc. stockholders’ equity
|
270,897
|
|
|
270,619
|
|
||
Non-controlling interests
|
177
|
|
|
173
|
|
||
Total Equity
|
271,074
|
|
|
270,792
|
|
||
Total Liabilities and Equity
|
$
|
694,037
|
|
|
$
|
554,441
|
|
|
For the year ended December 31,
|
|
For the transition period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
|
|
|
|
|
|
|
|
|
|||||||
Revenue
|
$
|
742,354
|
|
|
$
|
700,970
|
|
|
$
|
404,161
|
|
|
$
|
719,181
|
|
Cost of revenue
|
512,024
|
|
|
492,238
|
|
|
274,298
|
|
|
494,911
|
|
||||
Depreciation
|
22,456
|
|
|
21,020
|
|
|
12,859
|
|
|
21,262
|
|
||||
Gross profit
|
207,874
|
|
|
187,712
|
|
|
117,004
|
|
|
203,008
|
|
||||
Selling, general and administrative expenses
|
166,352
|
|
|
153,025
|
|
|
91,058
|
|
|
141,229
|
|
||||
Impairment charges
|
—
|
|
|
15,810
|
|
|
—
|
|
|
—
|
|
||||
Pension withdrawal expense
|
5,886
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Gain on sale of subsidiary
|
(2,384
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Research and engineering
|
3,310
|
|
|
2,272
|
|
|
1,577
|
|
|
2,523
|
|
||||
Depreciation and amortization
|
11,957
|
|
|
10,363
|
|
|
6,340
|
|
|
11,212
|
|
||||
Acquisition-related expense (benefit), net
|
532
|
|
|
482
|
|
|
496
|
|
|
(1,453
|
)
|
||||
Litigation charges
|
—
|
|
|
1,600
|
|
|
—
|
|
|
6,320
|
|
||||
Income from operations
|
22,221
|
|
|
4,160
|
|
|
17,533
|
|
|
43,177
|
|
||||
Interest expense
|
7,950
|
|
|
4,386
|
|
|
2,052
|
|
|
4,762
|
|
||||
Income (loss) before provision for income taxes
|
14,271
|
|
|
(226
|
)
|
|
15,481
|
|
|
38,415
|
|
||||
Provision for income taxes
|
7,426
|
|
|
1,942
|
|
|
5,870
|
|
|
13,765
|
|
||||
Net income (loss)
|
6,845
|
|
|
(2,168
|
)
|
|
9,611
|
|
|
24,650
|
|
||||
Less: net income (loss) attributable to noncontrolling interests, net of taxes
|
9
|
|
|
7
|
|
|
43
|
|
|
(4
|
)
|
||||
Net income (loss) attributable to Mistras Group, Inc.
|
$
|
6,836
|
|
|
$
|
(2,175
|
)
|
|
$
|
9,568
|
|
|
$
|
24,654
|
|
Earnings (loss) per common share
|
|
|
|
|
|
|
|
|
|||||||
Basic
|
$
|
0.24
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.33
|
|
|
$
|
0.85
|
|
Diluted
|
$
|
0.23
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.32
|
|
|
$
|
0.82
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
28,406
|
|
|
28,422
|
|
|
28,989
|
|
|
28,856
|
|
||||
Diluted
|
29,427
|
|
|
28,422
|
|
|
30,125
|
|
|
29,891
|
|
|
For the year ended December 31,
|
|
For the transition period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Net income (loss)
|
$
|
6,845
|
|
|
$
|
(2,168
|
)
|
|
$
|
9,611
|
|
|
$
|
24,650
|
|
|
|
|
|
|
|
|
|
|
|||||||
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
|
|||||||
Foreign currency translation adjustments
|
(10,752
|
)
|
|
12,919
|
|
|
(9,625
|
)
|
|
1,014
|
|
||||
Comprehensive (loss) income
|
(3,907
|
)
|
|
10,751
|
|
|
(14
|
)
|
|
25,664
|
|
||||
Less: net income (loss) attributable to noncontrolling interests
|
9
|
|
|
7
|
|
|
43
|
|
|
(4
|
)
|
||||
Foreign currency translation adjustments attributable to noncontrolling interests
|
(5
|
)
|
|
4
|
|
|
6
|
|
|
1
|
|
||||
Comprehensive (loss) income attributable to Mistras Group, Inc.
|
$
|
(3,921
|
)
|
|
$
|
10,748
|
|
|
$
|
(51
|
)
|
|
$
|
25,669
|
|
|
Common Stock
|
|
Treasury Stock
|
|
Additional
paid-in capital
|
|
Retained
earnings
|
|
Accumulated
other
comprehensive income (loss)
|
|
Total
Mistras Group,
Inc.
Stockholders’ Equity
|
|
Noncontrolling Interest
|
|
|
||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|
Total Equity
|
|||||||||||||||||||||||
Balance at May 31, 2015
|
28,703
|
|
|
$
|
287
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
208,064
|
|
|
$
|
57,581
|
|
|
$
|
(21,113
|
)
|
|
$
|
244,819
|
|
|
$
|
193
|
|
|
$
|
245,012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,654
|
|
|
—
|
|
|
24,654
|
|
|
(4
|
)
|
|
24,650
|
|
||||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,014
|
|
|
1,014
|
|
|
(64
|
)
|
|
950
|
|
||||||||
Share-based payments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,394
|
|
|
—
|
|
|
—
|
|
|
6,394
|
|
|
—
|
|
|
6,394
|
|
||||||||
Net settlement on vesting of restricted stock units
|
182
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(1,093
|
)
|
|
—
|
|
|
—
|
|
|
(1,091
|
)
|
|
—
|
|
|
(1,091
|
)
|
||||||||
Excess tax benefit from share-based payment compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
—
|
|
|
(170
|
)
|
||||||||
Exercise of stock options
|
55
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
542
|
|
|
—
|
|
|
—
|
|
|
543
|
|
|
—
|
|
|
543
|
|
||||||||
Balance at May 31, 2016
|
28,940
|
|
|
$
|
290
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
213,737
|
|
|
$
|
82,235
|
|
|
$
|
(20,099
|
)
|
|
$
|
276,163
|
|
|
$
|
125
|
|
|
$
|
276,288
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,568
|
|
|
—
|
|
|
9,568
|
|
|
43
|
|
|
9,611
|
|
||||||||
Other comprehensive loss, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,625
|
)
|
|
(9,625
|
)
|
|
(6
|
)
|
|
(9,631
|
)
|
||||||||
Share-based payments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,627
|
|
|
—
|
|
|
—
|
|
|
4,627
|
|
|
—
|
|
|
4,627
|
|
||||||||
Net settlement on vesting of restricted stock units
|
212
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(2,325
|
)
|
|
—
|
|
|
—
|
|
|
(2,323
|
)
|
|
—
|
|
|
(2,323
|
)
|
||||||||
Excess tax benefit from share-based payment compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|
—
|
|
|
—
|
|
|
568
|
|
|
—
|
|
|
568
|
|
||||||||
Purchase of treasury stock
|
—
|
|
|
—
|
|
|
(420
|
)
|
|
(9,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,000
|
)
|
|
—
|
|
|
(9,000
|
)
|
||||||||
Exercise of stock options
|
65
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
604
|
|
|
—
|
|
|
—
|
|
|
604
|
|
|
—
|
|
|
604
|
|
||||||||
Balance at December 31, 2016
|
29,217
|
|
|
$
|
292
|
|
|
(420
|
)
|
|
$
|
(9,000
|
)
|
|
$
|
217,211
|
|
|
$
|
91,803
|
|
|
$
|
(29,724
|
)
|
|
$
|
270,582
|
|
|
$
|
162
|
|
|
$
|
270,744
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,175
|
)
|
|
—
|
|
|
(2,175
|
)
|
|
7
|
|
|
(2,168
|
)
|
||||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,919
|
|
|
12,919
|
|
|
4
|
|
|
12,923
|
|
||||||||
Share-based payments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,588
|
|
|
—
|
|
|
—
|
|
|
6,588
|
|
|
—
|
|
|
6,588
|
|
||||||||
Net settlement on vesting of restricted stock units
|
187
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(1,649
|
)
|
|
—
|
|
|
—
|
|
|
(1,647
|
)
|
|
—
|
|
|
(1,647
|
)
|
||||||||
Retirement of treasury stock
|
(1,146
|
)
|
|
(12
|
)
|
|
1,146
|
|
|
24,923
|
|
|
—
|
|
|
(24,911
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Purchase of treasury stock
|
—
|
|
|
—
|
|
|
(726
|
)
|
|
(15,923
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,923
|
)
|
|
—
|
|
|
(15,923
|
)
|
||||||||
Exercise of stock options
|
37
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
275
|
|
|
—
|
|
|
—
|
|
|
275
|
|
|
—
|
|
|
275
|
|
||||||||
Balance at December 31, 2017
|
28,295
|
|
|
$
|
282
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
222,425
|
|
|
$
|
64,717
|
|
|
$
|
(16,805
|
)
|
|
$
|
270,619
|
|
|
$
|
173
|
|
|
$
|
270,792
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,836
|
|
|
—
|
|
|
6,836
|
|
|
9
|
|
|
6,845
|
|
||||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,752
|
)
|
|
(10,752
|
)
|
|
(5
|
)
|
|
(10,757
|
)
|
||||||||
Share-based payments
|
243
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
6,106
|
|
|
—
|
|
|
—
|
|
|
6,109
|
|
|
—
|
|
|
6,109
|
|
||||||||
Net settlement on vesting of restricted stock units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,188
|
)
|
|
—
|
|
|
—
|
|
|
(2,188
|
)
|
|
—
|
|
|
(2,188
|
)
|
||||||||
Exercise of stock options
|
25
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
273
|
|
|
—
|
|
|
—
|
|
|
273
|
|
|
—
|
|
|
273
|
|
||||||||
Balance at December 31, 2018
|
28,563
|
|
|
$
|
285
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
226,616
|
|
|
$
|
71,553
|
|
|
$
|
(27,557
|
)
|
|
$
|
270,897
|
|
|
$
|
177
|
|
|
$
|
271,074
|
|
|
For the year ended December 31,
|
|
For the transition period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|||||||
Net income (loss)
|
$
|
6,845
|
|
|
$
|
(2,168
|
)
|
|
$
|
9,611
|
|
|
$
|
24,650
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities
|
|
|
|
|
|
|
|
|
|
||||||
Depreciation and amortization
|
34,413
|
|
|
31,383
|
|
|
19,199
|
|
|
32,474
|
|
||||
Deferred income taxes
|
1,859
|
|
|
(4,854
|
)
|
|
(174
|
)
|
|
240
|
|
||||
Share-based compensation expense
|
6,107
|
|
|
6,574
|
|
|
4,559
|
|
|
6,514
|
|
||||
Impairment charges
|
—
|
|
|
15,810
|
|
|
—
|
|
|
—
|
|
||||
Bad debt provision for troubled customers
|
650
|
|
|
1,200
|
|
|
—
|
|
|
—
|
|
||||
Gain on sale of subsidiary
|
(2,384
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Fair value adjustments to contingent consideration
|
(716
|
)
|
|
(463
|
)
|
|
262
|
|
|
(2,066
|
)
|
||||
Other
|
1,773
|
|
|
79
|
|
|
559
|
|
|
(1,052
|
)
|
||||
Changes in operating assets and liabilities, net of effect of acquisitions
|
|
|
|
|
|
|
|
|
|
||||||
Accounts receivable
|
(10,349
|
)
|
|
2,490
|
|
|
4,123
|
|
|
(4,999
|
)
|
||||
Inventories
|
(2,764
|
)
|
|
(117
|
)
|
|
628
|
|
|
1,595
|
|
||||
Prepaid expenses and other assets
|
1,400
|
|
|
(1,904
|
)
|
|
(4,453
|
)
|
|
(1,812
|
)
|
||||
Accounts payable
|
2,948
|
|
|
2,574
|
|
|
(3,667
|
)
|
|
254
|
|
||||
Accrued expenses and other liabilities
|
5,663
|
|
|
4,188
|
|
|
(2,301
|
)
|
|
10,187
|
|
||||
Income taxes payable
|
(3,781
|
)
|
|
1,007
|
|
|
1,913
|
|
|
2,139
|
|
||||
Net cash provided by operating activities
|
41,664
|
|
|
55,799
|
|
|
30,259
|
|
|
68,124
|
|
||||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|||||||
Purchase of property, plant and equipment
|
(20,584
|
)
|
|
(19,314
|
)
|
|
(9,093
|
)
|
|
(14,864
|
)
|
||||
Purchase of intangible assets
|
(541
|
)
|
|
(1,255
|
)
|
|
(697
|
)
|
|
(1,315
|
)
|
||||
Disposition of business
|
4,239
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Acquisition of businesses, net of cash acquired
|
(139,980
|
)
|
|
(83,424
|
)
|
|
(8,262
|
)
|
|
(1,743
|
)
|
||||
Proceeds from sale of equipment
|
1,416
|
|
|
1,196
|
|
|
678
|
|
|
1,170
|
|
||||
Net cash used in investing activities
|
(155,450
|
)
|
|
(102,797
|
)
|
|
(17,374
|
)
|
|
(16,752
|
)
|
||||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|||||||
Repayment of capital lease obligations
|
(5,813
|
)
|
|
(6,492
|
)
|
|
(4,490
|
)
|
|
(7,870
|
)
|
||||
Proceeds from borrowings of long-term debt
|
2,358
|
|
|
6,653
|
|
|
386
|
|
|
2,737
|
|
||||
Repayment of long-term debt
|
(2,746
|
)
|
|
(2,101
|
)
|
|
(11,919
|
)
|
|
(17,580
|
)
|
||||
Proceeds from revolver
|
175,176
|
|
|
124,000
|
|
|
48,400
|
|
|
55,800
|
|
||||
Repayments of revolver
|
(49,991
|
)
|
|
(50,600
|
)
|
|
(34,300
|
)
|
|
(69,600
|
)
|
||||
Payments of debt issuance costs
|
(826
|
)
|
|
(560
|
)
|
|
—
|
|
|
—
|
|
||||
Payment of contingent consideration for business acquisitions
|
(2,277
|
)
|
|
(560
|
)
|
|
(795
|
)
|
|
(3,147
|
)
|
||||
Purchases of treasury stock
|
—
|
|
|
(15,923
|
)
|
|
(9,000
|
)
|
|
—
|
|
||||
Taxes paid related to net share settlement of share-based awards
|
(2,185
|
)
|
|
(1,647
|
)
|
|
(2,323
|
)
|
|
(1,091
|
)
|
||||
Excess tax benefit from share-based compensation
|
—
|
|
|
—
|
|
|
568
|
|
|
(170
|
)
|
||||
Proceeds from the exercise of stock options
|
273
|
|
|
275
|
|
|
604
|
|
|
543
|
|
||||
Net cash provided by (used in) financing activities
|
113,969
|
|
|
53,045
|
|
|
(12,869
|
)
|
|
(40,378
|
)
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
(2,180
|
)
|
|
2,340
|
|
|
(2,050
|
)
|
|
(361
|
)
|
||||
Net change in cash and cash equivalents
|
(1,997
|
)
|
|
8,387
|
|
|
(2,034
|
)
|
|
10,633
|
|
||||
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
||||||
Beginning of period
|
27,541
|
|
|
19,154
|
|
|
21,188
|
|
|
10,555
|
|
||||
End of period
|
$
|
25,544
|
|
|
$
|
27,541
|
|
|
$
|
19,154
|
|
|
$
|
21,188
|
|
Supplemental disclosure of cash paid
|
|
|
|
|
|
|
|
|
|||||||
Interest
|
$
|
7,751
|
|
|
$
|
4,264
|
|
|
$
|
2,079
|
|
|
$
|
4,151
|
|
Income taxes
|
$
|
10,983
|
|
|
$
|
3,063
|
|
|
$
|
8,119
|
|
|
$
|
10,686
|
|
Noncash investing and financing
|
|
|
|
|
|
|
|
|
|||||||
Equipment acquired through capital lease obligations
|
$
|
4,845
|
|
|
$
|
3,185
|
|
|
$
|
1,829
|
|
|
$
|
8,248
|
|
Issuance of notes payable and other debt obligations primarily related to acquisitions
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
325
|
|
|
$
|
—
|
|
•
|
The optional transition method set forth in ASU 2018-11 in connection with the adoption of ASC 842 on January 1, 2019.
|
•
|
The “package of practical expedients,” which permits the Company not to reassess under the new standard prior conclusions on lease identification, lease classification and initial direct costs.
|
•
|
The practical expedient not to separate lease and non-lease components within the lease and account for all lease components as a single lease component.
|
Year ended December 31, 2018
|
Services
|
|
International
|
|
Products
|
|
Corp/Elim
|
|
Total
|
||||||||||
Oil & Gas
|
$
|
378,904
|
|
|
$
|
37,953
|
|
|
$
|
1,255
|
|
|
$
|
—
|
|
|
$
|
418,112
|
|
Aerospace & Defense
|
50,500
|
|
|
54,853
|
|
|
2,355
|
|
|
—
|
|
|
107,708
|
|
|||||
Industrials
|
60,594
|
|
|
26,209
|
|
|
3,097
|
|
|
—
|
|
|
89,900
|
|
|||||
Power generation & Transmission
|
30,687
|
|
|
8,522
|
|
|
4,904
|
|
|
—
|
|
|
44,113
|
|
|||||
Other Process Industries
|
26,425
|
|
|
9,497
|
|
|
124
|
|
|
—
|
|
|
36,046
|
|
|||||
Infrastructure, Research & Engineering
|
11,283
|
|
|
9,032
|
|
|
5,246
|
|
|
—
|
|
|
25,561
|
|
|||||
Other
|
16,226
|
|
|
7,382
|
|
|
6,445
|
|
|
(9,139
|
)
|
|
20,914
|
|
|||||
Total
|
$
|
574,619
|
|
|
$
|
153,448
|
|
|
$
|
23,426
|
|
|
$
|
(9,139
|
)
|
|
$
|
742,354
|
|
Year ended December 31, 2018
|
Services
|
|
International
|
|
Products
|
|
Corp/Elim
|
|
Total
|
||||||||||
United States
|
$
|
478,853
|
|
|
$
|
568
|
|
|
$
|
11,493
|
|
|
$
|
(3,500
|
)
|
|
$
|
487,414
|
|
Other Americas
|
90,823
|
|
|
7,995
|
|
|
1,068
|
|
|
(1,638
|
)
|
|
98,248
|
|
|||||
Europe
|
4,252
|
|
|
138,948
|
|
|
3,958
|
|
|
(3,846
|
)
|
|
143,312
|
|
|||||
Asia-Pacific
|
691
|
|
|
5,937
|
|
|
6,907
|
|
|
(155
|
)
|
|
13,380
|
|
|||||
Total
|
$
|
574,619
|
|
|
$
|
153,448
|
|
|
$
|
23,426
|
|
|
$
|
(9,139
|
)
|
|
$
|
742,354
|
|
|
For the year ended December 31,
|
|
For the transition period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Basic earnings (loss) per share
|
|
|
|
|
|
|
|
|
|||||||
Numerator:
|
|
|
|
|
|
|
|
|
|||||||
Net income (loss) attributable to Mistras Group, Inc.
|
$
|
6,836
|
|
|
$
|
(2,175
|
)
|
|
$
|
9,568
|
|
|
$
|
24,654
|
|
Denominator
|
|
|
|
|
|
|
|
|
|||||||
Weighted average common shares outstanding
|
28,406
|
|
|
28,422
|
|
|
28,989
|
|
|
28,856
|
|
||||
Basic earnings (loss) per share
|
$
|
0.24
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.33
|
|
|
$
|
0.85
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|||||||
Numerator:
|
|
|
|
|
|
|
|
|
|||||||
Net income (loss) attributable to Mistras Group, Inc.
|
$
|
6,836
|
|
|
$
|
(2,175
|
)
|
|
$
|
9,568
|
|
|
$
|
24,654
|
|
Denominator
|
|
|
|
|
|
|
|
|
|||||||
Weighted average common shares outstanding
|
28,406
|
|
|
28,422
|
|
|
28,989
|
|
|
28,856
|
|
||||
Dilutive effect of stock options outstanding
|
683
|
|
|
—
|
|
|
791
|
|
|
712
|
|
||||
Dilutive effect of restricted stock units outstanding
|
338
|
|
|
—
|
|
|
345
|
|
|
323
|
|
||||
|
29,427
|
|
|
28,422
|
|
|
30,125
|
|
|
29,891
|
|
||||
Diluted earnings (loss) per share
|
$
|
0.23
|
|
|
$
|
(0.08
|
)
|
|
$
|
0.32
|
|
|
$
|
0.82
|
|
|
For the year ended December 31,
|
|
For the transition period ended December 31,
|
|
For the year ended May 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
|||||
Potential common stock attributable to stock options outstanding
|
5
|
|
|
810
|
|
(1
|
)
|
—
|
|
|
5
|
|
Potential common stock attributable to restricted stock units (RSUs) and performance stock units (PSUs) outstanding
|
1
|
|
|
353
|
|
(2
|
)
|
2
|
|
|
24
|
|
Total
|
6
|
|
|
1,163
|
|
|
2
|
|
|
29
|
|
|
December 31,
|
|
December 31,
|
||||
|
2018
|
|
2017
|
||||
Trade accounts receivable
|
$
|
152,511
|
|
|
$
|
141,952
|
|
Allowance for doubtful accounts
|
(4,187
|
)
|
|
(3,872
|
)
|
||
Accounts receivable, net
|
$
|
148,324
|
|
|
$
|
138,080
|
|
|
December 31,
|
|
December 31,
|
||||
|
2018
|
|
2017
|
||||
Raw materials
|
$
|
6,975
|
|
|
$
|
5,105
|
|
Work in progress
|
1,019
|
|
|
1,192
|
|
||
Finished goods
|
2,640
|
|
|
2,746
|
|
||
Consumable supplies
|
2,419
|
|
|
1,460
|
|
||
Inventory
|
$
|
13,053
|
|
|
$
|
10,503
|
|
|
|
|
December 31,
|
|
December 31,
|
||||
|
Useful Life
|
|
2018
|
|
2017
|
||||
|
(Years)
|
|
|
|
|
||||
Land
|
|
|
$
|
2,680
|
|
|
$
|
2,414
|
|
Building and improvements
|
30-40
|
|
24,338
|
|
|
24,003
|
|
||
Office furniture and equipment
|
5-8
|
|
16,170
|
|
|
14,230
|
|
||
Machinery and equipment
|
5-7
|
|
208,245
|
|
|
191,721
|
|
||
|
|
|
251,433
|
|
|
232,368
|
|
||
Accumulated depreciation and amortization
|
|
|
(157,538
|
)
|
|
(145,225
|
)
|
||
Property, plant and equipment, net
|
|
|
$
|
93,895
|
|
|
$
|
87,143
|
|
|
Year ended December 31, 2018
|
|
Year ended December 31, 2017
|
||||
Number of entities
|
1
|
|
|
3
|
|
||
|
|
|
|
||||
Cash paid
|
$
|
143,139
|
|
|
$
|
83,963
|
|
Working capital adjustments
|
—
|
|
|
150
|
|
||
Notes payable
|
—
|
|
|
—
|
|
||
Contingent consideration
|
—
|
|
|
3,407
|
|
||
Consideration paid
|
$
|
143,139
|
|
|
$
|
87,520
|
|
|
|
|
|
||||
Current net assets
|
$
|
9,381
|
|
|
$
|
7,165
|
|
Other assets
|
136
|
|
|
—
|
|
||
Debt and other liabilities
|
(4,976
|
)
|
|
(2,848
|
)
|
||
Property, plant and equipment
|
8,549
|
|
|
11,115
|
|
||
Deferred tax liability
|
(12,672
|
)
|
|
(1,278
|
)
|
||
Intangibles
|
59,558
|
|
|
31,671
|
|
||
Goodwill
|
83,163
|
|
|
41,695
|
|
||
Net assets acquired
|
$
|
143,139
|
|
|
$
|
87,520
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Due diligence, professional fees and other transaction costs
|
$
|
1,248
|
|
|
$
|
945
|
|
|
$
|
231
|
|
|
$
|
629
|
|
Adjustments to fair value of contingent consideration liabilities
|
(716
|
)
|
|
(463
|
)
|
|
265
|
|
|
(2,082
|
)
|
||||
Acquisition-related (benefit) expense, net
|
$
|
532
|
|
|
$
|
482
|
|
|
$
|
496
|
|
|
$
|
(1,453
|
)
|
|
For the year ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
Total revenue
|
$
|
770,222
|
|
|
$
|
727,821
|
|
Net income (loss)
|
6,602
|
|
|
(2,180
|
)
|
||
|
|
|
|
||||
Net income (loss) per common share: basic
|
$
|
0.23
|
|
|
$
|
(0.08
|
)
|
Net income (loss) per common share: diluted
|
$
|
0.22
|
|
|
$
|
(0.08
|
)
|
•
|
The pro forma financial information assumes that the acquisition related transaction fees and costs for Onstream were removed from the year ended December 31, 2018 and were assumed to have been incurred prior to acquisition;
|
•
|
Additional interest expense resulting from the issuance of debt to finance the consideration exchanged for the acquisition.
|
•
|
Additional depreciation and amortization expense due to (1) the amortization of identifiable intangibles with a definitive life using the straight-line method over a weighted average useful life of
12.6 years
, and (2) increase in depreciation resulting from the step-up of property, plant and equipment depreciated on a straight-line basis over their useful life of
5 years
; and
|
•
|
Adjustments were tax effected at an effective tax rate of
26%
as of December 31, 2018 and
31%
as of December 31, 2017.
|
|
Services
|
|
International
|
|
Products and Systems
|
|
Total
|
||||||||
Balance at December 31, 2016
|
$
|
123,392
|
|
|
$
|
33,351
|
|
|
$
|
13,197
|
|
|
$
|
169,940
|
|
Goodwill acquired during the year
|
41,695
|
|
|
—
|
|
|
—
|
|
|
41,695
|
|
||||
Impairment charge
|
—
|
|
|
—
|
|
|
(13,197
|
)
|
|
(13,197
|
)
|
||||
Adjustments to preliminary purchase price allocations
|
(211
|
)
|
|
—
|
|
|
—
|
|
|
(211
|
)
|
||||
Foreign currency translation
|
925
|
|
|
4,286
|
|
|
—
|
|
|
5,211
|
|
||||
Balance at December 31, 2017
|
$
|
165,801
|
|
|
$
|
37,637
|
|
|
$
|
—
|
|
|
$
|
203,438
|
|
Goodwill acquired during the year
|
83,163
|
|
|
—
|
|
|
—
|
|
|
83,163
|
|
||||
Adjustments to preliminary purchase price allocations
|
(1,977
|
)
|
|
—
|
|
|
—
|
|
|
(1,977
|
)
|
||||
Foreign currency translation
|
(3,511
|
)
|
|
(1,854
|
)
|
|
—
|
|
|
(5,365
|
)
|
||||
Balance at December 31, 2018
|
$
|
243,476
|
|
|
$
|
35,783
|
|
|
$
|
—
|
|
|
$
|
279,259
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
||||||||||||||||||||||
|
|
|
2018
|
|
2017
|
|
|
||||||||||||||||||||||
|
Useful Life
(Years)
|
|
Gross
Amount |
|
Accumulated
Amortization |
|
Net
Carrying Amount |
|
Gross
Amount |
|
Accumulated
Amortization |
|
Impairment
|
|
Net
Carrying Amount |
||||||||||||||
Customer relationships
|
5-14
|
|
$
|
112,624
|
|
|
$
|
(60,993
|
)
|
|
$
|
51,631
|
|
|
$
|
113,299
|
|
|
$
|
(58,107
|
)
|
|
$
|
(170
|
)
|
|
$
|
55,022
|
|
Software/Technology
|
3-15
|
|
67,240
|
|
|
(13,319
|
)
|
|
53,921
|
|
|
19,523
|
|
|
(14,133
|
)
|
|
(2,411
|
)
|
|
2,979
|
|
|||||||
Covenants not to compete
|
2-5
|
|
12,593
|
|
|
(10,825
|
)
|
|
1,768
|
|
|
12,510
|
|
|
(10,438
|
)
|
|
—
|
|
|
2,072
|
|
|||||||
Other
|
2-12
|
|
10,317
|
|
|
(6,242
|
)
|
|
4,075
|
|
|
10,109
|
|
|
(6,411
|
)
|
|
(32
|
)
|
|
3,666
|
|
|||||||
Total
|
|
|
$
|
202,774
|
|
|
$
|
(91,379
|
)
|
|
$
|
111,395
|
|
|
$
|
155,441
|
|
|
$
|
(89,089
|
)
|
|
$
|
(2,613
|
)
|
|
$
|
63,739
|
|
|
Expected
Amortization
Expense
|
||
|
|
|
|
2019
|
$
|
13,735
|
|
2020
|
12,368
|
|
|
2021
|
11,292
|
|
|
2022
|
10,722
|
|
|
2023
|
9,946
|
|
|
Thereafter
|
53,332
|
|
|
Total
|
$
|
111,395
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Accrued salaries, wages and related employee benefits
|
$
|
29,959
|
|
|
$
|
27,185
|
|
Contingent consideration
|
1,687
|
|
|
3,430
|
|
||
Accrued workers' compensation and health benefits
|
5,086
|
|
|
5,181
|
|
||
Deferred revenues
|
5,046
|
|
|
6,338
|
|
||
Legal settlement accrual
|
—
|
|
|
1,600
|
|
||
Pension accrual
|
5,585
|
|
|
—
|
|
||
Other accrued expenses
|
26,532
|
|
|
21,827
|
|
||
Total accrued expenses and other current liabilities
|
$
|
73,895
|
|
|
$
|
65,561
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Senior credit facility
|
$
|
181,656
|
|
|
$
|
156,948
|
|
Senior secured term loan, net of debt issuance costs of $0.1 million
|
99,897
|
|
|
—
|
|
||
Notes payable
|
68
|
|
|
228
|
|
||
Other
|
8,999
|
|
|
9,702
|
|
||
Total debt
|
290,620
|
|
|
166,878
|
|
||
Less: Current portion
|
(6,833
|
)
|
|
(2,358
|
)
|
||
Long-term debt, net of current portion
|
$
|
283,787
|
|
|
$
|
164,520
|
|
2019
|
$
|
6,831
|
|
2020
|
6,515
|
|
|
2021
|
8,750
|
|
|
2022
|
11,030
|
|
|
2023
|
255,043
|
|
|
Thereafter
|
2,451
|
|
|
Total
|
$
|
290,620
|
|
Balance at December 31, 2016
|
|
$
|
3,094
|
|
Acquisitions
|
|
3,407
|
|
|
Payments
|
|
(560
|
)
|
|
Accretion of liability
|
|
272
|
|
|
Revaluation
|
|
(735
|
)
|
|
Foreign currency translation
|
|
30
|
|
|
Balance at December 31, 2017
|
|
$
|
5,508
|
|
Acquisitions
|
|
—
|
|
|
Payments
|
|
(2,277
|
)
|
|
Accretion of liability
|
|
175
|
|
|
Revaluation
|
|
(891
|
)
|
|
Foreign currency translation
|
|
(150
|
)
|
|
Balance at December 31, 2018
|
|
$
|
2,365
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Cash proceeds from options exercised
|
$
|
273
|
|
|
$
|
275
|
|
|
$
|
604
|
|
|
$
|
543
|
|
Aggregate intrinsic value of options exercised
|
277
|
|
|
580
|
|
|
993
|
|
|
658
|
|
|
For the years ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||||||||||||||
|
Common Stock Options
|
|
Weighted Average Exercise Price
|
|
Common
Stock Options |
|
Weighted
Average Exercise Price |
|
Common
Stock
Options
|
|
Weighted
Average
Exercise
Price
|
|
Common
Stock
Options
|
|
Weighted
Average
Exercise
Price
|
||||||||||||
Outstanding at beginning of year:
|
2,130
|
|
|
$
|
13.43
|
|
|
2,167
|
|
|
$
|
13.33
|
|
|
2,232
|
|
|
$
|
13.21
|
|
|
2,287
|
|
|
$
|
13.13
|
|
Granted
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Exercised
|
(25
|
)
|
|
$
|
10.75
|
|
|
(37
|
)
|
|
$
|
7.39
|
|
|
(65
|
)
|
|
$
|
9.27
|
|
|
(55
|
)
|
|
$
|
9.87
|
|
Expired or forfeited
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Outstanding at end of year:
|
2,105
|
|
|
$
|
13.47
|
|
|
2,130
|
|
|
$
|
13.43
|
|
|
2,167
|
|
|
$
|
13.33
|
|
|
2,232
|
|
|
$
|
13.21
|
|
|
|
|
|
For the year ended December 31, 2018
|
||||||||||||||
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||
Range of Exercise Prices
|
|
Total
Options
Outstanding
|
|
Weighted
Average
Remaining
Life (Years)
|
|
Weighted
Average
Exercise
Price
|
|
Number
Exercisable
|
|
Weighted
Average
Exercise
Price
|
||||||||
$10.00-$10.00
|
|
10
|
|
|
0.3
|
|
$
|
10.00
|
|
|
10
|
|
|
$
|
10.00
|
|
||
$13.46-$22.35
|
|
2,095
|
|
|
0.7
|
|
$
|
13.48
|
|
|
2,095
|
|
|
$
|
13.48
|
|
||
|
|
2,105
|
|
|
|
|
|
|
|
2,105
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
Aggregate Intrinsic Value
|
|
$
|
1,965
|
|
|
|
|
|
|
|
$
|
1,965
|
|
|
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Restricted stock awards vested
|
258
|
|
|
185
|
|
|
207
|
|
|
223
|
|
||||
Fair value of awards vested
|
$
|
5.3
|
|
|
$
|
3.4
|
|
|
$
|
5.1
|
|
|
$
|
3.5
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Awards issued
|
19
|
|
|
21
|
|
|
10
|
|
|
28
|
|
||||
Grant date fair value of awards issued
|
$
|
0.4
|
|
|
$
|
0.4
|
|
|
$
|
0.3
|
|
|
$
|
0.5
|
|
|
For the year ended December 31,
|
|
For the transition period ended December 31,
|
|
For the year ended May 31,
|
|||||||||||||||||||||
|
2018
|
2017
|
|
2016
|
|
2016
|
||||||||||||||||||||
|
Units
|
|
Weighted
Average Grant-Date Fair Value |
Units
|
|
Weighted
Average Grant-Date Fair Value |
|
Units
|
|
Weighted
Average Grant-Date Fair Value |
|
Units
|
|
Weighted
Average
Grant-Date
Fair Value
|
||||||||||||
Outstanding at beginning of period:
|
532
|
|
|
$
|
21.05
|
|
569
|
|
|
$
|
20.81
|
|
|
575
|
|
|
$
|
18.85
|
|
|
564
|
|
|
$
|
20.47
|
|
Granted
|
211
|
|
|
$
|
19.20
|
|
183
|
|
|
$
|
21.26
|
|
|
219
|
|
|
$
|
24.48
|
|
|
264
|
|
|
$
|
16.73
|
|
Released
|
(258
|
)
|
|
$
|
20.48
|
|
(185
|
)
|
|
$
|
20.49
|
|
|
(207
|
)
|
|
$
|
19.40
|
|
|
(223
|
)
|
|
$
|
20.40
|
|
Forfeited
|
(42
|
)
|
|
$
|
20.52
|
|
(35
|
)
|
|
$
|
21.45
|
|
|
(18
|
)
|
|
$
|
19.55
|
|
|
(30
|
)
|
|
$
|
19.26
|
|
Outstanding at end of period:
|
443
|
|
|
$
|
20.55
|
|
532
|
|
|
$
|
21.05
|
|
|
569
|
|
|
$
|
20.81
|
|
|
575
|
|
|
$
|
18.85
|
|
|
For the year ended December 31,
|
|
For the transition period ended December 31,
|
|||||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|||||||||||||||
|
Units
|
|
Weighted
Average Grant-Date Fair Value |
|
Units
|
|
Weighted
Average Grant-Date Fair Value |
|
Units
|
|
Weighted
Average Grant-Date Fair Value |
|||||||||
Outstanding at beginning of period:
|
278
|
|
|
$
|
17.00
|
|
|
290
|
|
|
$
|
16.01
|
|
|
328
|
|
|
$
|
17.02
|
|
Granted
|
129
|
|
|
$
|
19.46
|
|
|
128
|
|
|
$
|
20.42
|
|
|
105
|
|
|
$
|
24.90
|
|
Performance condition adjustments, net
|
(50
|
)
|
|
$
|
19.48
|
|
|
(68
|
)
|
|
$
|
20.55
|
|
|
(54
|
)
|
|
$
|
24.49
|
|
Released
|
(68
|
)
|
|
$
|
16.03
|
|
|
(72
|
)
|
|
$
|
15.82
|
|
|
(89
|
)
|
|
$
|
24.50
|
|
Forfeited
|
(12
|
)
|
|
$
|
16.16
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Outstanding at end of period:
|
277
|
|
|
$
|
17.80
|
|
|
278
|
|
|
$
|
17.00
|
|
|
290
|
|
|
$
|
16.01
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Income (loss) before provision for income taxes from:
|
|
|
|
|
|
|
|
|
|||||||
U.S. operations
|
$
|
9,853
|
|
|
$
|
(7,303
|
)
|
|
$
|
5,116
|
|
|
$
|
27,772
|
|
Foreign operations
|
4,418
|
|
|
7,077
|
|
|
10,365
|
|
|
10,643
|
|
||||
Earnings (loss) before income taxes
|
$
|
14,271
|
|
|
$
|
(226
|
)
|
|
$
|
15,481
|
|
|
$
|
38,415
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
|||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
|
||||||||
Current
|
|
|
|
|
|
|
|
|
|
|||||||
Federal
|
$
|
790
|
|
|
$
|
3,558
|
|
|
$
|
1,990
|
|
|
$
|
9,156
|
|
|
States and local
|
533
|
|
|
39
|
|
|
483
|
|
|
1,537
|
|
|
||||
Foreign
|
3,824
|
|
|
3,131
|
|
|
3,569
|
|
|
3,672
|
|
|
||||
Reserve for uncertain tax positions
|
337
|
|
|
71
|
|
|
(39
|
)
|
|
(529
|
)
|
|
||||
Total current
|
5,484
|
|
|
6,799
|
|
|
6,003
|
|
|
13,836
|
|
|
||||
Deferred
|
|
|
|
|
|
|
|
|
|
|||||||
Federal
|
2,966
|
|
|
(3,857
|
)
|
|
6
|
|
|
82
|
|
|
||||
States and local
|
399
|
|
|
(810
|
)
|
|
(28
|
)
|
|
(51
|
)
|
|
||||
Foreign
|
(2,089
|
)
|
|
(437
|
)
|
|
(514
|
)
|
|
(557
|
)
|
|
||||
Total deferred
|
1,276
|
|
|
(5,104
|
)
|
|
(536
|
)
|
|
(526
|
)
|
|
||||
Net change in valuation allowance
|
666
|
|
|
247
|
|
|
403
|
|
|
455
|
|
|
||||
Net deferred
|
1,942
|
|
|
(4,857
|
)
|
|
(133
|
)
|
|
(71
|
)
|
|
||||
Provision for income taxes
|
$
|
7,426
|
|
|
$
|
1,942
|
|
|
$
|
5,870
|
|
|
$
|
13,765
|
|
|
|
For the years ended December 31,
|
|
For the Transition period ended December 31,
|
||||||||||||||||
|
2018
|
2017
|
|
2016
|
|||||||||||||||
Federal tax at statutory rate
|
$
|
2,997
|
|
|
21.0
|
%
|
$
|
(79
|
)
|
|
35.0
|
%
|
|
$
|
5,418
|
|
|
35.0
|
%
|
State taxes, net of federal benefit
|
737
|
|
|
5.1
|
%
|
(502
|
)
|
|
221.6
|
%
|
|
296
|
|
|
1.9
|
%
|
|||
Foreign tax
|
807
|
|
|
5.7
|
%
|
217
|
|
|
(95.8
|
)%
|
|
(573
|
)
|
|
(3.7
|
)%
|
|||
Contingent consideration
|
(6
|
)
|
|
—
|
%
|
(63
|
)
|
|
27.7
|
%
|
|
(4
|
)
|
|
—
|
%
|
|||
Nondeductible compensation
|
183
|
|
|
1.3
|
%
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
US taxation of foreign earnings
|
228
|
|
|
1.6
|
%
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Permanent differences
|
361
|
|
|
2.5
|
%
|
377
|
|
|
(166.4
|
)%
|
|
373
|
|
|
2.4
|
%
|
|||
Transition tax, net of foreign tax credits
|
1,158
|
|
|
8.1
|
%
|
3,942
|
|
|
(1,741.4
|
)%
|
|
—
|
|
|
—
|
%
|
|||
Federal tax rate change due to the Tax Act
|
87
|
|
|
0.6
|
%
|
(1,956
|
)
|
|
864.0
|
%
|
|
—
|
|
|
—
|
%
|
|||
Other
|
208
|
|
|
1.4
|
%
|
(241
|
)
|
|
106.5
|
%
|
|
(43
|
)
|
|
(0.3
|
)%
|
|||
Change in valuation allowance
|
666
|
|
|
4.7
|
%
|
247
|
|
|
(109.1
|
)%
|
|
403
|
|
|
2.6
|
%
|
|||
Total provision for income taxes
|
$
|
7,426
|
|
|
52.0
|
%
|
$
|
1,942
|
|
|
(857.9
|
)%
|
|
$
|
5,870
|
|
|
37.9
|
%
|
|
For the year ended May 31,
|
||||||
|
2016
|
|
|||||
Federal tax at statutory rate
|
$
|
13,445
|
|
|
35.0
|
%
|
|
State taxes, net of federal benefit
|
966
|
|
|
2.5
|
%
|
|
|
Foreign tax
|
(610
|
)
|
|
(1.6
|
)%
|
|
|
Contingent consideration
|
(425
|
)
|
|
(1.1
|
)%
|
|
|
Permanent differences
|
245
|
|
|
0.6
|
%
|
|
|
Other
|
(311
|
)
|
|
(0.8
|
)%
|
|
|
Change in valuation allowance
|
455
|
|
|
1.2
|
%
|
|
|
Total provision for income taxes
|
$
|
13,765
|
|
|
35.8
|
%
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Deferred income tax assets
|
|
|
|
||||
Allowance for doubtful accounts
|
$
|
951
|
|
|
$
|
838
|
|
Inventory
|
285
|
|
|
265
|
|
||
Intangible assets
|
1,230
|
|
|
2,255
|
|
||
Accrued expenses
|
4,408
|
|
|
2,560
|
|
||
Net operating loss carryforward
|
3,889
|
|
|
3,729
|
|
||
Capital lease obligations
|
731
|
|
|
1,004
|
|
||
Capital losses
|
462
|
|
|
463
|
|
||
Foreign tax credit carryover
|
—
|
|
|
618
|
|
||
Deferred share-based compensation
|
3,728
|
|
|
4,080
|
|
||
Other
|
699
|
|
|
484
|
|
||
Deferred income tax assets
|
16,383
|
|
|
16,296
|
|
||
Valuation allowance
|
(4,235
|
)
|
|
(4,044
|
)
|
||
Net deferred income tax assets
|
12,148
|
|
|
12,252
|
|
||
Deferred income tax liabilities
|
|
|
|
||||
Property and equipment
|
(7,597
|
)
|
|
(6,893
|
)
|
||
Goodwill
|
(9,302
|
)
|
|
(6,578
|
)
|
||
Intangible assets
|
(16,459
|
)
|
|
(5,972
|
)
|
||
Other
|
(8
|
)
|
|
(6
|
)
|
||
Deferred income tax liabilities
|
(33,366
|
)
|
|
(19,449
|
)
|
||
Net deferred income taxes
|
$
|
(21,218
|
)
|
|
$
|
(7,197
|
)
|
|
For the year ended December 31,
|
||||||
|
2018
|
|
2017
|
||||
Balance at beginning of period
|
$
|
156
|
|
|
$
|
267
|
|
Additions for tax positions related to the current fiscal period
|
1
|
|
|
11
|
|
||
Additions for tax positions related to prior years
|
341
|
|
|
188
|
|
||
Decreases for tax positions related to prior years
|
(2
|
)
|
|
—
|
|
||
Current year acquisitions
|
270
|
|
|
—
|
|
||
Impact of foreign exchange fluctuation
|
—
|
|
|
10
|
|
||
Settlements
|
(4
|
)
|
|
(198
|
)
|
||
Reductions related to the expiration of statutes of limitations
|
(39
|
)
|
|
(122
|
)
|
||
Balance at end of period
|
$
|
723
|
|
|
$
|
156
|
|
2019
|
$
|
4,686
|
|
2020
|
3,489
|
|
|
2021
|
2,757
|
|
|
2022
|
1,475
|
|
|
2023
|
807
|
|
|
Thereafter
|
773
|
|
|
Total minimum lease payments
|
13,987
|
|
|
Less: amount representing interest
|
(990
|
)
|
|
Present value of minimum lease payments
|
12,997
|
|
|
Less: current portion of obligations under capital leases
|
(3,922
|
)
|
|
Obligations under capital leases, net of current portion
|
$
|
9,075
|
|
2019
|
$
|
10,939
|
|
2020
|
8,764
|
|
|
2021
|
6,327
|
|
|
2022
|
4,826
|
|
|
2023
|
4,239
|
|
|
Thereafter
|
10,667
|
|
|
Total
|
$
|
45,762
|
|
•
|
Services.
This segment provides asset protection solutions predominantly in North America, with the largest concentration in the United States, followed by Canada, consisting primarily of non-destructive testing, and inspection
|
•
|
International.
This segment offers services, products and systems similar to those of the other segments to select markets within Europe, the Middle East, Africa, Asia and South America, but not to customers in China and South Korea, which are served by the Products and Systems segment.
|
•
|
Products and Systems.
This segment designs, manufactures, sells, installs and services the Company’s asset protection products and systems, including equipment and instrumentation, predominantly in the United States.
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Revenues
|
|
|
|
|
|
|
|
|
|||||||
Services
|
$
|
574,619
|
|
|
$
|
543,565
|
|
|
$
|
293,218
|
|
|
$
|
553,279
|
|
International
|
153,448
|
|
|
144,265
|
|
|
104,013
|
|
|
143,025
|
|
||||
Products and Systems
|
23,426
|
|
|
23,297
|
|
|
14,541
|
|
|
30,293
|
|
||||
Corporate and eliminations
|
(9,139
|
)
|
|
(10,157
|
)
|
|
(7,611
|
)
|
|
(7,416
|
)
|
||||
|
$
|
742,354
|
|
|
$
|
700,970
|
|
|
$
|
404,161
|
|
|
$
|
719,181
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Gross profit
|
|
|
|
|
|
|
|
|
|||||||
Services
|
$
|
151,974
|
|
|
$
|
139,160
|
|
|
$
|
75,784
|
|
|
$
|
145,262
|
|
International
|
45,464
|
|
|
38,974
|
|
|
34,210
|
|
|
43,613
|
|
||||
Products and Systems
|
10,560
|
|
|
9,798
|
|
|
6,920
|
|
|
14,022
|
|
||||
Corporate and eliminations
|
(124
|
)
|
|
(220
|
)
|
|
90
|
|
|
111
|
|
||||
|
$
|
207,874
|
|
|
$
|
187,712
|
|
|
$
|
117,004
|
|
|
$
|
203,008
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Income from operations
|
|
|
|
|
|
|
|
|
|||||||
Services
|
$
|
47,126
|
|
|
$
|
46,677
|
|
|
$
|
22,411
|
|
|
$
|
52,552
|
|
International
|
3,953
|
|
|
3,537
|
|
|
10,597
|
|
|
9,293
|
|
||||
Products and Systems
|
2,368
|
|
|
(16,991
|
)
|
|
(254
|
)
|
|
2,688
|
|
||||
Corporate and eliminations
|
(31,226
|
)
|
|
(29,063
|
)
|
|
(15,221
|
)
|
|
(21,356
|
)
|
||||
|
$
|
22,221
|
|
|
$
|
4,160
|
|
|
$
|
17,533
|
|
|
$
|
43,177
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Depreciation and amortization
|
|
|
|
|
|
|
|
|
|||||||
Services
|
$
|
24,079
|
|
|
$
|
21,649
|
|
|
$
|
12,765
|
|
|
$
|
22,725
|
|
International
|
8,846
|
|
|
7,768
|
|
|
5,306
|
|
|
7,774
|
|
||||
Products and Systems
|
1,429
|
|
|
2,180
|
|
|
1,372
|
|
|
2,323
|
|
||||
Corporate and eliminations
|
59
|
|
|
(214
|
)
|
|
(244
|
)
|
|
(348
|
)
|
||||
|
$
|
34,413
|
|
|
$
|
31,383
|
|
|
$
|
19,199
|
|
|
$
|
32,474
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Intangible assets, net
|
|
|
|
||||
Services
|
$
|
98,362
|
|
|
$
|
46,864
|
|
International
|
11,143
|
|
|
13,899
|
|
||
Products and Systems
|
1,438
|
|
|
2,261
|
|
||
Corporate and eliminations
|
452
|
|
|
715
|
|
||
|
$
|
111,395
|
|
|
$
|
63,739
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Total assets
|
|
|
|
||||
Services
|
$
|
523,506
|
|
|
$
|
377,585
|
|
International
|
146,535
|
|
|
150,779
|
|
||
Products and Systems
|
12,264
|
|
|
12,733
|
|
||
Corporate and eliminations
|
11,732
|
|
|
13,344
|
|
||
|
$
|
694,037
|
|
|
$
|
554,441
|
|
|
For the year ended December 31,
|
|
For the Transition Period ended December 31,
|
|
For the year ended May 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
|
2016
|
||||||||
Revenue
|
|
|
|
|
|
|
|
|
|||||||
United States
|
$
|
487,414
|
|
|
$
|
466,683
|
|
|
$
|
256,926
|
|
|
$
|
519,361
|
|
Other Americas
|
98,248
|
|
|
86,870
|
|
|
41,777
|
|
|
67,809
|
|
||||
Europe
|
143,312
|
|
|
132,421
|
|
|
91,847
|
|
|
118,566
|
|
||||
Asia-Pacific
|
13,380
|
|
|
14,996
|
|
|
13,611
|
|
|
13,445
|
|
||||
|
$
|
742,354
|
|
|
$
|
700,970
|
|
|
$
|
404,161
|
|
|
$
|
719,181
|
|
|
|
Twelve Months Ended December 31, 2016
|
|
Seven Months Ended December 31, 2015
|
||||
|
|
(unaudited)
|
||||||
Revenues
|
|
$
|
684,762
|
|
|
$
|
427,913
|
|
Cost of revenues
|
|
468,929
|
|
|
292,718
|
|
||
Depreciation
|
|
21,699
|
|
|
12,005
|
|
||
Gross profit
|
|
194,134
|
|
|
123,190
|
|
||
Selling, general and administrative expenses
|
|
148,914
|
|
|
81,117
|
|
||
Research and engineering
|
|
2,670
|
|
|
1,431
|
|
||
Depreciation and amortization
|
|
10,689
|
|
|
6,503
|
|
||
Litigation charges
|
|
6,320
|
|
|
—
|
|
||
Acquisition-related benefit, net
|
|
(5
|
)
|
|
(959
|
)
|
||
Income from operations
|
|
25,546
|
|
|
35,098
|
|
||
Interest expense, net
|
|
3,075
|
|
|
3,672
|
|
||
Income before provision for income taxes
|
|
22,471
|
|
|
31,426
|
|
||
Provision for income taxes
|
|
8,008
|
|
|
11,627
|
|
||
Net income
|
|
14,463
|
|
|
19,799
|
|
||
Less: Net income (loss) attributable to non-controlling interests
|
|
54
|
|
|
(15
|
)
|
||
Net income available to Mistras Group, Inc. shareholders
|
|
$
|
14,409
|
|
|
$
|
19,814
|
|
Net income per share: Basic
|
|
$
|
0.50
|
|
|
$
|
0.69
|
|
Net income per share: Diluted
|
|
$
|
0.48
|
|
|
$
|
0.67
|
|
Weighted average shares outstanding:
|
|
|
|
|
||||
Basic
|
|
28,960
|
|
|
28,810
|
|
||
Diluted
|
|
30,114
|
|
|
29,676
|
|
Fiscal quarter ended
|
|
December 31, 2018
|
|
September 30, 2018
|
|
June 30, 2018
|
|
March 31, 2018
|
||||||||
Revenues
|
|
$
|
180,762
|
|
|
$
|
182,169
|
|
|
$
|
191,793
|
|
|
$
|
187,630
|
|
Gross Profit
|
|
52,315
|
|
|
52,332
|
|
|
55,083
|
|
|
48,145
|
|
||||
Income from operations
|
|
2,502
|
|
|
3,017
|
|
|
8,409
|
|
|
6,399
|
|
||||
Net income (loss) attributable to Mistras Group, Inc.
|
|
$
|
(1,061
|
)
|
|
$
|
(1,010
|
)
|
|
$
|
6,000
|
|
|
$
|
2,919
|
|
Earnings (loss) per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
0.21
|
|
|
$
|
0.10
|
|
Diluted
|
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
0.20
|
|
|
$
|
0.10
|
|
Fiscal quarter ended
|
|
December 31, 2017
|
|
September 30, 2017
|
|
June 30, 2017
|
|
March 31, 2017
|
||||||||
Revenues
|
|
$
|
187,643
|
|
|
$
|
179,570
|
|
|
$
|
170,439
|
|
|
$
|
163,318
|
|
Gross Profit
|
|
50,319
|
|
|
47,897
|
|
|
46,343
|
|
|
43,153
|
|
||||
Income (loss) from operations
|
|
6,282
|
|
|
(10,375
|
)
|
|
5,003
|
|
|
3,250
|
|
||||
Net income (loss) attributable to Mistras Group, Inc.
|
|
$
|
884
|
|
|
$
|
(6,968
|
)
|
|
$
|
2,217
|
|
|
$
|
1,692
|
|
Earnings (loss) per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
0.03
|
|
|
$
|
(0.25
|
)
|
|
$
|
0.08
|
|
|
$
|
0.06
|
|
Diluted
|
|
$
|
0.03
|
|
|
$
|
(0.25
|
)
|
|
$
|
0.07
|
|
|
$
|
0.06
|
|
Fiscal quarter ended
|
|
December 31, 2016
|
|
September 30, 2016
|
|
June 30, 2016
|
|
March 31, 2016
|
||||||||
Revenues
|
|
$
|
170,156
|
|
|
$
|
168,811
|
|
|
$
|
178,340
|
|
|
$
|
167,455
|
|
Gross Profit
|
|
47,978
|
|
|
50,651
|
|
|
51,535
|
|
|
43,970
|
|
||||
Income from operations
|
|
2,944
|
|
|
12,116
|
|
|
4,840
|
|
|
5,646
|
|
||||
Net income attributable to Mistras Group, Inc.
|
|
$
|
963
|
|
|
$
|
7,238
|
|
|
$
|
2,761
|
|
|
$
|
3,447
|
|
Earnings per common share:
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
0.03
|
|
|
$
|
0.25
|
|
|
$
|
0.10
|
|
|
$
|
0.12
|
|
Diluted
|
|
$
|
0.03
|
|
|
$
|
0.24
|
|
|
$
|
0.09
|
|
|
$
|
0.11
|
|
Plan Category
|
|
Number of Securities
to be Issued Upon
Exercise of
Outstanding Options
|
|
Weighted Average
Exercise Price of
Outstanding Options
|
|
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation Plans
|
||||
|
|
(in thousands, except exercise price data)
|
||||||||
Equity Compensation Plans Approved by Security Holders (1)
|
|
2,105
|
|
|
$
|
13.47
|
|
|
1,143
|
|
|
|
|
|
|
|
|
||||
Equity Compensation Plans Not Approved by Security Holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
||||
Total
|
|
2,105
|
|
|
$
|
13.43
|
|
|
1,143
|
|
|
Page
|
|
50
|
|
|
51
|
|
|
52
|
|
|
53
|
|
|
54
|
|
|
55
|
|
|
56
|
|
Exhibit No.
|
|
Description
|
2.1
|
|
|
|
|
|
2.2
|
|
|
|
|
|
2.3
|
|
|
|
|
|
3.1
|
|
|
|
|
|
3.2
|
|
|
|
|
|
3.3
|
|
|
|
|
|
4.1
|
|
|
|
|
|
10.1
|
|
Fourth Amended and Restated Credit Agreement dated December 8, 2017 (filed as Exhibit 10.3 to Annual Report on Form 10-K filed March 14, 2018 and incorporated herein by reference)
|
|
|
|
10.2
|
|
Fifth Amended and Restated Credit Agreement dated December 13, 2017 (filed as Exhibit 10.1 to Current Report on Form 8-K filed December 13, 2018 and incorporated herein by reference)
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
10.5
|
|
|
|
|
|
10.6
|
|
|
|
|
|
10.7
|
|
|
|
|
|
10.8
|
|
|
|
|
|
10.9
|
|
|
|
|
|
10.10
|
|
|
|
|
|
10.11*
|
|
|
|
|
|
10.12
|
|
|
|
|
|
10.13
|
|
|
|
|
|
10.14
|
|
|
|
|
|
21.1*
|
|
|
|
|
|
23.1*
|
|
|
|
|
|
24.1*
|
|
|
|
|
|
31.1*
|
|
|
|
|
|
31.2*
|
|
|
|
|
|
32.1**
|
|
|
|
|
|
32.2**
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Schema Document
|
|
|
|
101.CAL
|
|
XBRL Calculation Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Labels Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Presentation Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Definition Linkbase Document
|
|
MISTRAS GROUP, INC.
|
|
|
By:
|
/s/ Dennis Bertolotti
|
|
Dennis Bertolotti
|
|
|
President and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/Dr. Sotirios J. Vahaviolos
|
|
Executive Chairman and Director
|
|
March 15, 2019
|
Dr. Sotirios J. Vahaviolos
|
|
|
|
|
|
|
|
|
|
/s/Dennis Bertolotti
|
|
President, Chief Executive Officer and Director
(Principal Executive Officer)
|
|
March 15, 2019
|
Dennis Bertolotti
|
|
|
|
|
|
|
|
|
|
/s/ Edward J. Prajzner
|
|
Senior Vice President, Chief Financial Officer and Treasurer
(Principal Financial and
Accounting Officer)
|
|
March 15, 2019
|
Edward J. Prajzner
|
|
|
|
|
|
|
|
|
|
/s/ James J. Forese
|
|
Director
|
|
March 15, 2019
|
James J. Forese
|
|
|
|
|
|
|
|
|
|
/s/ Richard H. Glanton
|
|
Director
|
|
March 15, 2019
|
Richard H. Glanton
|
|
|
|
|
|
|
|
|
|
/s/ Nicholas DeBenedictis
|
|
Director
|
|
March 15, 2019
|
Nicholas DeBenedictis
|
|
|
|
|
|
|
|
|
|
/s/ Michael J. Lange
|
|
Director
|
|
March 15, 2019
|
Michael J. Lange
|
|
|
|
|
|
|
|
|
|
/s/ Manuel N. Stamatakis
|
|
Director
|
|
March 15, 2019
|
Manuel N. Stamatakis
|
|
|
|
|
|
|
|
|
|
/s/ W. Curtis Weldon
|
|
Director
|
|
March 15, 2019
|
W. Curtis Weldon
|
|
|
|
|
1.
|
Termination without Cause
.
|
a.
|
Participant is convicted of or pleads nolo contendere to a felony;
|
b.
|
Participant is indicted for the commission of a felony against the Company that has a materially adverse effect on the Company’s business;
|
c.
|
Participant commits fraud or a material act or omission involving dishonesty with respect to the Company;
|
d.
|
Participant willfully fails or refuses to carry out the material responsibilities of his or her employment;
|
e.
|
Participant commits a willful act (or failure to act) that constitutes gross negligence which is materially injurious to the Company; or
|
f.
|
Participant willfully violates a material policy of the Company, including policies on business ethics and conduct, and policies on the use of inside information and insider trading.
|
2.
|
Termination for Good Reason.
|
a.
|
there is a material adverse change in Participant’s status or position, including a material diminution of his or her position, duties, responsibilities or authority or the assignment to him of duties or responsibilities that are materially inconsistent with his status or position;
|
b.
|
a reduction in Participant’s annual base salary or failure to pay same;
|
c.
|
a reduction in Participant’s total target incentive award opportunities during a fiscal year;
|
d.
|
the relocation of Participant’s principal place of employment by more than 50 miles from the then current location;
|
e.
|
Participant is directed by the Board of Directors of Mistras or a higher level officer of the Company to engage in conduct that is unethical or illegal;
|
f.
|
in connection with a Change in Control (as defined below), the failure or refusal by the successor or acquiring company to expressly assume the obligations of the Company under this Plan at the time of the Change in Control; or
|
g.
|
there is a material adverse change to this Plan.
|
1.
|
Pay
|
(a)
|
Stock options, RSUs and other time-based equity awards: During the Restricted Period (so long as the Participant is complying with the confidentiality requirements and the non-compete and non-solicitation restrictions in his or her release agreement), all stock options, RSUs and other time-based equity awards will continue to vest. Any vested stock options shall expire 90 days after the end of the Restricted Period. Upon the expiration of the Restricted Period, all unvested awards shall terminate.
|
(b)
|
Performance-based awards: Any outstanding performance-based awards will be earned and vested on a pro rata basis to the date of termination, on the condition that the Participant complies with the confidentiality requirements and the non-compete and non-solicitation restrictions in his or her release agreement during the Restricted Period. The amount of the payout shall be based upon actual performance for the respective performance cycle and payout will be made at the end of the performance cycle, provided that the Company may elect to make the payout in cash rather than equity, if the end of cycle payout is in equity.
|
|
|
Jurisdiction of
|
Name
|
|
Organization
|
2159562 Alberta Ltd.
|
|
Canada
|
Aetos Group, Inc.
|
|
Delaware
|
CISMIS Springfield Corp.
|
|
Delaware
|
Conam Inspection and Engineering Services, Inc.
|
|
Delaware
|
Conam Inspection Services Inc.
|
|
Delaware
|
GMA Aeronautica S.L.U.
|
|
Germany
|
GMA Engineering GmbH
|
|
Germany
|
GMA Holding B.V.
|
|
The Netherlands
|
GMA Werkstoffprufung GmbH
|
|
Germany
|
Mistras Arizona Inspection Services Inc.
|
|
Delaware
|
Mistras Canada, Inc.
|
|
Canada
|
Mistras Engineering Services Inc.
|
|
Delaware
|
Mistras GMA Holdings GmbH
|
|
Germany
|
Mistras Group B.V.
|
|
The Netherlands
|
Mistras Group BVBA
|
|
Belgium
|
Mistras Group GmbH
|
|
Germany
|
Mistras Group Limited
|
|
England and Wales
|
Mistras Group SAS
|
|
France
|
Mistras Group Hellas A.B.E.E.
|
|
Greece
|
Mistras Group South America Ltda
|
|
Brazil
|
Mistras International Holdings Inc.
|
|
Delaware
|
Mistras Quebec Holdings Inc.
|
|
Canada
|
Mistras Western Canada Holdings Inc.
|
|
Canada
|
MWC Management Inc.
|
|
Canada
|
NDT do Brasil Ltd.
|
|
Brazil
|
Onstream Holdings, Inc.
|
|
Canada
|
Onstream Pipeline Inspection Services Inc.
|
|
Canada
|
Onstream Pipeline Inspection USA Inc.
|
|
Nevada
|
Physical Acoustics India Private Ltd.
|
|
India
|
Physical Acoustics South America Ltda.
|
|
Brazil
|
Quality Services Laboratories, Inc. (1)
|
|
Delaware
|
QSL NDT Inc.
|
|
Delaware
|
QSL NDT Quebec Inc.
|
|
Canada
|
R.A.C. Group Inc.
|
|
Canada
|
Rope Access Calgary, Inc.
|
|
Canada
|
The Nacher Corporation
|
|
Louisiana
|
West Penn Non-Destructive Testing, LLC
|
|
Pennsylvania
|
|
By:
|
/s/ DENNIS BERTOLOTTI
|
|
|
Dennis Bertolotti
|
|
|
President, Chief Executive Officer and Director
(Principal Executive Officer)
|
|
By:
|
/s/ EDWARD J. PRAJZNER
|
|
|
Edward J. Prajzner
|
|
|
Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer)
|
Date:
|
March 15, 2019
|
/s/ DENNIS BERTOLOTTI
|
|
|
Dennis Bertolotti
|
|
|
President, Chief Executive Officer and Director
|
|
|
(Principal Executive Officer)
|
Date:
|
March 15, 2019
|
/s/ EDWARD J. PRAJZNER
|
|
|
Edward J. Prajzner
|
|
|
Senior Vice President, Chief Financial Officer, and Treasurer
|
|
|
(Principal Financial and Accounting Officer)
|