þ
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended | December 31, 2011 |
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from | to |
Commission File Number: 0-10786 | |||
Aegion Corporation | |||
(Exact name of registrant as specified in its charter) |
Delaware | 45-3117900 |
State or other jurisdiction of incorporation or organization | (I.R.S. Employer Identification No.) |
17988 Edison Avenue, Chesterfield, Missouri | 63005-1195 |
(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code | (636) 530-8000 |
Title of each class
Class A Common Shares, $.01 par value
Preferred Stock Purchase Rights
|
Name of each exchange on which registered
The Nasdaq Global Select Market
The Nasdaq Global Select Market
|
PART I | ||||
Item 1. | Business | 2 | ||
Item 1A. | Risk Factors | 14 | ||
Item 1B. | Unresolved Staff Comments | 22 | ||
Item 2. | Properties | 22 | ||
Item 3. | Legal Proceedings | 23 | ||
Item 4. | Mine Safety Disclosure | 23 | ||
Item 4A. | Executive Officers of the Registrant | 23 | ||
PART II | ||||
Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 24 | ||
Item 6. | Selected Financial Data | 27 | ||
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 28 | ||
Item 7A. | Quantitative and Qualitative Disclosures about Market Risk | 44 | ||
Item 8. | Financial Statements and Supplementary Data | 46 | ||
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS | 46 | |||
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 83 | ||
Item 9A. | Controls and Procedures | 83 | ||
Item 9B. | Other Information | 83 | ||
PART III | ||||
Item 10. | Directors, Executive Officers and Corporate Governance | 84 | ||
Item 11. | Executive Compensation | 84 | ||
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 84 | ||
Item 13. | Certain Relationships and Related Transactions, and Director Independence | 84 | ||
Item 14. | Principal Accountant Fees and Services | 84 | ||
PART IV | ||||
Item 15. | Exhibits and Financial Statement Schedules | 85 | ||
SIGNATURES | 86 |
December 31,
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||||||||||||
2011
|
2010
|
2009
|
||||||||||
(in millions)
|
||||||||||||
Energy and Mining
|
$ | 256.4 | $ | 146.1 | $ | 180.2 | ||||||
North American Sewer and Water Rehabilitation
|
130.0 | 159.5 | 188.6 | |||||||||
European Sewer and Water Rehabilitation
|
20.7 | 23.3 | 37.2 | |||||||||
Asia-Pacific Sewer and Water Rehabilitation
|
37.5 | 79.8 | 57.4 | |||||||||
Commercial and Structural
|
19.6 | – | – | |||||||||
Total
|
$ | 464.2 | $ | 408.7 | $ | 463.4 |
Ÿ
|
market prices of mined minerals, oil and natural gas and expectations about future prices;
|
Ÿ
|
cost of producing mined minerals, oil and natural gas;
|
Ÿ
|
the level of mining, drilling and production activity;
|
Ÿ
|
the discovery rate of new oil and gas reserves;
|
Ÿ
|
mergers, consolidations and downsizing among our clients;
|
Ÿ
|
coordination by the Organization of Petroleum Exporting Countries (OPEC);
|
Ÿ
|
the impact of commodity prices on the expenditure levels of our clients;
|
Ÿ
|
financial condition of our client base and their ability to fund capital and maintenance expenditures;
|
Ÿ
|
adverse weather conditions;
|
Ÿ
|
civil unrest in oil-producing countries;
|
Ÿ
|
level of consumption of minerals, oil, natural gas and petrochemicals by consumers; and
|
Ÿ
|
availability of services and materials for our clients to grow their capital expenditures.
|
Ÿ
|
difficulties in enforcing agreements and collecting receivables through some foreign legal systems;
|
Ÿ
|
foreign customers with longer payment cycles than customers in the United States;
|
Ÿ
|
tax rates in certain foreign countries that exceed those in the United States and foreign earnings subject to withholding requirements;
|
Ÿ
|
tax laws that restrict our ability to use tax credits, offset gains or repatriate funds;
|
Ÿ
|
tariffs, exchange controls or other trade restrictions including transfer pricing restrictions when products produced in one country are sold to an affiliated entity in another country;
|
Ÿ
|
abrupt changes in foreign government policies and regulations;
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Ÿ
|
unsettled political conditions;
|
Ÿ
|
difficulties in enforcing intellectual property rights or weaker intellectual property right protections in some countries;
|
Ÿ
|
hostility from local populations, particularly in the Middle East; and
|
Ÿ
|
difficulties associated with compliance with a variety of laws and regulations governing international trade, including the Foreign Corrupt Practices Act.
|
Ÿ
|
actual or anticipated variations in quarterly operating results;
|
Ÿ
|
changes in financial estimates by securities analysts that cover our stock or our failure to meet these estimates;
|
Ÿ
|
conditions or trends in the U.S. sewer rehabilitation market;
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Ÿ
|
conditions or trends in mined materials, oil and natural gas markets;
|
Ÿ
|
changes in municipal and corporate spending practices;
|
Ÿ
|
a downturn of the municipal bond market or lending markets generally;
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Ÿ
|
changes in market valuations of other companies operating in our industries;
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Ÿ
|
announcements by us or our competitors of a significant acquisition or divestiture; and
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Ÿ
|
additions or departures of key personnel.
|
J. Joseph Burgess
|
53
|
President and Chief Executive Officer
|
David F. Morris
|
50
|
Senior Vice President, Chief Administrative Officer, General Counsel and Secretary
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David A. Martin
|
44
|
Senior Vice President and Chief Financial Officer
|
Brian J. Clarke
|
52
|
Senior Vice President – Business Integration
|
Kenneth L. Young
|
60
|
Vice President and Treasurer
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Laura M. Villa
|
42
|
Vice President – Human Resources
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Period
|
High
|
Low
|
||||||
2011
|
||||||||
First Quarter
|
$ | 30.00 | $ | 24.00 | ||||
Second Quarter
|
27.16 | 18.10 | ||||||
Third Quarter
|
22.86 | 11.39 | ||||||
Fourth Quarter
|
16.53 | 10.45 | ||||||
2010
|
||||||||
First Quarter
|
$ | 28.37 | $ | 19.94 | ||||
Second Quarter
|
28.38 | 19.10 | ||||||
Third Quarter
|
25.51 | 18.52 | ||||||
Fourth Quarter
|
28.52 | 21.06 |
Plan Category
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
(a)
|
Weighted-average exercise price of outstanding options, warrants and rights
(b)
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
(c)
|
|||||||||
Equity compensation plans approved by security holders
(1)
|
1,703,256 | $ | 19.09 | 2,079,558 | ||||||||
Equity compensation plans not approved by security holders
(2)
|
221,489 | 14.55 | – | |||||||||
Total
|
1,924,745 | $ | 18.26 | 2,079,558 |
(1)
|
The number of securities to be issued upon exercise of granted/awarded options, warrants and rights includes 989,315 stock options, 540,025 stock awards and 173,916 deferred and restricted stock units outstanding at December 31, 2011.
|
(2)
|
On April 14, 2008, we granted J. Joseph Burgess 118,397 non-qualified stock options, a performance-based award of 52,784 shares of restricted stock and a one-time award of 103,092 shares of restricted stock in connection with his appointment as our President and Chief Executive Officer. These awards were issued as “inducement grants” under the rules of the Nasdaq Global Select Market and, as such, were not issued pursuant to our 2009 Employee Equity Incentive Plan. At December 31, 2011, 118,397 stock options and 103,092 shares of restricted stock were outstanding pursuant to these awards.
|
Total Number of Shares (or Units) Purchased
(1)(2)
|
Average Price Paid per Share (or Unit)
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
(1)
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
(1)(3)
|
|||||||||||||
October 28 – October 31, 2011
|
159,300 | $ | 15.54 | 159,300 | $ | 7,524,963 | ||||||||||
November 1-30, 2011
|
167,296 | 15.16 | 166,600 | 5,000,000 | ||||||||||||
Total
|
326,596 | $ | 15.34 | 325,900 | $ | 5,000,000 |
(1)
|
This share repurchase program was publicly announced on October 10, 2011. Our board of directors approved the repurchase of up to $10.0 million of our common stock. The authorization allows us to purchase up to $5.0 million of our common stock during the fourth quarter of 2011 and up to $5.0 million of our common stock during 2012. We engaged Merrill Lynch, Pierce, Fenner & Smith as our exclusive broker to execute the stock purchase program under a trading plan that was established in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934. The plan expires June 30, 2012 unless earlier terminated by either party. Once repurchased, we immediately retired the shares.
|
(2)
|
Our board of directors also approved the purchase of up to $5.0 million of our common stock in each calendar year in connection with our equity compensation programs for employees and directors. In 2011, participants in our equity plans surrendered 696 shares of previously issued common stock, in satisfaction of tax obligations arising from the vesting of restricted stock awards under such plans. The deemed price paid was the closing price of our common stock on the Nasdaq Global Select Market on the date that the restricted stock vested.
|
(3)
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During January 2012, we acquired 310,035 shares for $5.0 million ($16.13 average price per share) through the open market repurchase program. Once repurchased, we immediately retired the shares.
|
·
|
Michael Baker Corporation
|
·
|
Layne Christensen Company
|
·
|
Granite Construction, Inc.
|
·
|
MasTec, Inc.
|
·
|
ENGlobal Corporation
|
·
|
Sterling Construction Company, Inc.
|
·
|
Dycom Industries, Inc.
|
·
|
Kennametal, Inc.
|
·
|
Global Industries, Ltd.
|
·
|
Tetra Tech, Inc.
|
·
|
Matrix Service Company
|
·
|
Dril-Quip, Inc.
|
·
|
Team, Inc.
|
·
|
Willbros Group, Inc.
|
2006
|
2007
|
2008
|
2009
|
2010
|
2011
|
|||||||||||||||||||
Aegion Corporation
|
$ | 100.00 | $ | 57.23 | $ | 76.13 | $ | 87.85 | $ | 102.51 | $ | 59.31 | ||||||||||||
S&P 500 Total Returns
|
100.00 | 105.50 | 66.47 | 84.05 | 96.72 | 98.76 | ||||||||||||||||||
Peer Group
|
100.00 | 123.92 | 79.10 | 96.66 | 112.82 | 102.41 |
Years Ended December 31,
|
||||||||||||||||||||
2011
(1) (2)
|
2010
|
2009
(3) (4)
|
2008
|
2007
(5)
|
||||||||||||||||
(In thousands, except per share amounts)
|
||||||||||||||||||||
INCOME STATEMENT DATA:
|
||||||||||||||||||||
Revenues
|
$ | 938,585 | $ | 914,975 | $ | 726,866 | $ | 536,664 | $ | 495,570 | ||||||||||
Operating income
|
44,537 | 87,035 | 49,117 | 33,882 | 13,530 | |||||||||||||||
Income from continuing operations
(6)
|
26,547 | 60,562 | 30,241 | 24,076 | 12,866 | |||||||||||||||
Loss from discontinued operations
|
— | (100 | ) | (4,070 | ) | (2,436 | ) | (10,323 | ) | |||||||||||
Net income
(6)
|
26,547 | 60,462 | 26,171 | 21,640 | 2,543 | |||||||||||||||
Basic earnings (loss) per share:
|
||||||||||||||||||||
Income from continuing operations
(6)
|
0.67 | 1.55 | 0.81 | 0.87 | 0.47 | |||||||||||||||
Loss from discontinued operations
|
— | (0.01 | ) | (0.11 | ) | (0.09 | ) | (0.38 | ) | |||||||||||
Net income
(6)
|
0.67 | 1.54 | 0.70 | 0.78 | 0.09 | |||||||||||||||
Diluted earnings (loss) per share:
|
||||||||||||||||||||
Income from continuing operations
(6)
|
0.67 | 1.54 | 0.81 | 0.86 | 0.47 | |||||||||||||||
Loss from discontinued operations
|
— | (0.01 | ) | (0.11 | ) | (0.09 | ) | (0.38 | ) | |||||||||||
Net income
(6)
|
0.67 | 1.53 | 0.70 | 0.77 | 0.09 | |||||||||||||||
BALANCE SHEET DATA:
|
||||||||||||||||||||
Cash and cash equivalents
|
$ | 106,129 | $ | 114,829 | $ | 106,064 | $ | 99,321 | $ | 78,961 | ||||||||||
Working capital, net of cash
|
219,137 | 178,262 | 125,088 | 115,681 | 117,862 | |||||||||||||||
Current assets
|
517,985 | 466,586 | 405,006 | 324,672 | 309,289 | |||||||||||||||
Property, plant and equipment, net
|
168,945 | 164,486 | 150,896 | 72,210 | 76,714 | |||||||||||||||
Total assets
|
1,124,964 | 933,310 | 866,583 | 553,529 | 555,781 | |||||||||||||||
Current maturities of long-term debt and
notes payable
|
26,541 | 13,028 | 12,742 | 938 | 1,097 | |||||||||||||||
Long-term debt, less current maturities
|
222,868 | 91,715 | 101,500 | 65,000 | 65,000 | |||||||||||||||
Total liabilities
|
475,975 | 306,603 | 312,772 | 178,317 | 185,882 | |||||||||||||||
Total stockholders’ equity
|
640,732 | 617,332 | 548,341 | 372,200 | 367,182 |
(1)
|
2011 results include expenses of $6.4 million related to the acquisitions of CRTS, Hockway and the North American and Latin American operations of Fyfe, $2.2 million related to a company-wide restructuring program initiated in the third quarter of 2011 and $6.8 million recorded in the third quarter of 2011 in connection with the redemption of our Senior Notes due 2013 and our write-off of unamortized debt issuance costs from our prior credit facility.
|
(2)
|
2011 results include amounts from our acquisitions of CRTS, Hockway and Fyfe NA from their acquisition dates of June 30, 2011, August 2, 2011 and August 31, 2011, respectively.
|
(3)
|
2009 results include expenses of $8.5 million related to the acquisitions of Bayou and Corrpro and $5.2 million recorded in the fourth quarter of 2009 in connection with the restructuring of our European operations and the closure of the Corrpro paint team business ($4.0 million of which is classified on the restructuring line of the income statement and $1.2 million of which is classified in operating expenses on the income statement).
|
(4)
|
2009 results include amounts from our acquisitions of Bayou and Corrpro from their acquisition dates of February 20, 2009 and March 31, 2009, respectively.
|
(5)
|
Includes $17.9 million of exit charges recorded in 2007 in connection with the closure of our tunneling business.
|
(6)
|
All periods presented include amounts attributable to Aegion Corporation.
|
●
|
expanding our position in the growing and profitable energy and mining sector through organic growth, selective acquisitions of companies, formation of strategic alliances and by conducting complimentary product and technology acquisitions;
|
●
|
growing market opportunities in the commercial and structural infrastructure sector (A) through (i) continued customer acceptance of current products and technologies and (ii) expansion of our product and service offerings with respect to protection, rehabilitation and restoration of a broader group of infrastructure assets and (B) by leveraging our premier brand and experience of successfully innovating and delivering technologies and services through selective acquisitions of companies and technologies and through strategic alliances;
|
●
|
expanding all of our businesses in key emerging markets such as Asia and the Middle East; and
|
●
|
streamlining our wastewater rehabilitation operations by improving project execution, cost management practices, including the reduction of redundant fixed costs, and product mix; and by identifying opportunities to streamline key management functions and processes to improve our profitability; and strongly emphasizing higher return manufacturing operations.
|
(dollars in thousands)
|
Increase (Decrease)
|
|||||||||||||||
2011
|
2010
|
$ | % | |||||||||||||
Revenues
|
$ | 938,585 | $ | 914,975 | $ | 23,610 | 2.6 | % | ||||||||
Gross profit
|
203,124 | 229,580 | (26,456 | ) | (11.5 | ) | ||||||||||
Gross profit margin
|
21.6 | % | 25.1 | % | n/a | (3.5 | ) | |||||||||
Operating expenses
|
151,764 | 144,245 | 7,519 | 5.2 | ||||||||||||
Reversal of earnout
|
(1,700 | ) | (1,700 | ) | — | — | ||||||||||
Acquisition-related expenses
|
6,372 | — | 6,372 | n/m | ||||||||||||
Restructuring charges
|
2,151 | — | 2,151 | n/m | ||||||||||||
Operating income
|
44,537 | 87,035 | (42,498 | ) | (48.8 | ) | ||||||||||
Operating margin
|
4.7 | % | 9.5 | % | n/a | (4.8 | ) | |||||||||
Income from continuing operations
|
26,547 | 60,562 | (34,015 | ) | (56.2 | ) |
(dollars in thousands)
|
Increase (Decrease)
|
|||||||||||||||
2010
|
2009
|
$ | % | |||||||||||||
Revenues
|
$ | 914,975 | $ | 726,866 | $ | 188,109 | 25.9 | % | ||||||||
Gross profit
|
229,580 | 190,591 | 38,989 | 20.5 | ||||||||||||
Gross profit margin
|
25.1 | % | 26.2 | % | n/a | (1.1 | ) | |||||||||
Operating expenses
|
144,245 | 130,555 | 13,690 | 10.5 | ||||||||||||
Reversal of earnout
|
(1,700 | ) | (1,600 | ) | (100 | ) | 6.3 | |||||||||
Acquisition-related expenses
|
— | 8,494 | (8,494 | ) | n/m | |||||||||||
Restructuring charges
|
— | 4,025 | (4,025 | ) | n/m | |||||||||||
Operating income
|
87,035 | 49,117 | 37,918 | 77.2 | ||||||||||||
Operating margin
|
9.5 | % | 6.8 | % | n/a | 2.7 | ||||||||||
Income from continuing operations
|
60,562 | 30,241 | 30,321 | 100.3 |
(dollars in thousands)
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||||||||||
Increase (Decrease)
|
Increase (Decrease)
|
|||||||||||||||||||||||||||
2011
|
2010
|
$ | % | 2009 | $ | % | ||||||||||||||||||||||
Revenues
|
$ | 433,230 | $ | 382,246 | $ | 50,984 | 13.3 | % | $ | 241,678 | $ | 140,568 | 58.2 | % | ||||||||||||||
Gross profit
|
109,753 | 105,309 | 4,444 | 4.2 | 67,185 | 38,124 | 56.7 | |||||||||||||||||||||
Gross profit margin
|
25.3 | % | 27.6 | % | n/a | (2.3 | ) | 27.8 | % | n/a | (0.2 | ) | ||||||||||||||||
Operating expenses
|
72,982 | 65,888 | 7,094 | 10.8 | 48,713 | 17,175 | 35.3 | |||||||||||||||||||||
Reversal of earnout
|
(1,700 | ) | (1,700 | ) | — | — | (1,600 | ) | (100 | ) | 6.3 | |||||||||||||||||
Acquisition-related expenses
|
2,682 | — | 2,682 | n/m | 8,472 | (8,472 | ) | (100.0 | ) | |||||||||||||||||||
Restructuring charges
|
778 | — | 778 | n/m | 676 | (676 | ) | (100.0 | ) | |||||||||||||||||||
Operating income
|
35,011 | 41,121 | (6,110 | ) | (14.9 | ) | 10,924 | 30,197 | 276.4 | |||||||||||||||||||
Operating margin
|
8.1 | % | 10.8 | % | n/a | (2.7 | ) | 4.5 | % | n/a | 6.3 |
(dollars in thousands)
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||||||||||
Increase (Decrease)
|
Increase (Decrease)
|
|||||||||||||||||||||||||||
2011
|
2010
|
$ | % | 2009 | $ | % | ||||||||||||||||||||||
Revenues
|
$ | 357,507 | $ | 413,828 | $ | (56,321 | ) | (13.6 | )% | $ | 365,889 | $ | 47,939 | 13.1 | % | |||||||||||||
Gross profit
|
55,443 | 93,376 | (37,933 | ) | (40.6 | ) | 91,744 | 1,632 | 1.8 | |||||||||||||||||||
Gross profit margin
|
15.5 | % | 22.6 | % | n/a | (7.1 | ) | 25.1 | % | n/a | (2.5 | ) | ||||||||||||||||
Operating expenses
|
48,191 | 52,545 | (4,354 | ) | (8.3 | ) | 55,694 | (3,149 | ) | (5.7 | ) | |||||||||||||||||
Restructuring charges
|
503 | — | 503 | n/m | — | — | n/m | |||||||||||||||||||||
Operating income
|
6,749 | 40,831 | (34,082 | ) | (83.5 | ) | 36,050 | 4,781 | 13.3 | |||||||||||||||||||
Operating margin
|
1.9 | % | 9.9 | % | n/a | (8.0 | ) | 9.9 | % | n/a | — |
(dollars in thousands)
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||||||||||
Increase (Decrease)
|
Increase (Decrease)
|
|||||||||||||||||||||||||||
2011
|
2010
|
$ | % | 2009 | $ | % | ||||||||||||||||||||||
Revenues
|
$ | 87,017 | $ | 74,260 | $ | 12,757 | 17.2 | % | $ | 86,043 | $ | (11,783 | ) | (13.7 | )% | |||||||||||||
Gross profit
|
22,837 | 20,606 | 2,231 | 10.8 | 22,630 | (2,024 | ) | (8.9 | ) | |||||||||||||||||||
Gross profit margin
|
26.2 | % | 27.7 | % | n/a | (1.5 | ) | 26.3 | % | n/a | 1.4 | |||||||||||||||||
Operating expenses
|
16,140 | 15,593 | 547 | 3.5 | 20,557 | (4,964 | ) | (24.1 | ) | |||||||||||||||||||
Restructuring charges
|
697 | — | 697 | n/m | 3,349 | (3,349 | ) | n/m | ||||||||||||||||||||
Operating income (loss)
|
6,000 | 5,013 | 987 | 19.7 | (1,276 | ) | 6,289 | (492.9 | ) | |||||||||||||||||||
Operating margin
|
6.9 | % | 6.8 | % | n/a | 0.1 | (1.5 | %) | n/a | 8.3 |
(dollars in thousands)
|
2011 vs. 2010
|
2010 vs. 2009
|
||||||||||||||||||||||||||
Increase (Decrease)
|
Increase (Decrease)
|
|||||||||||||||||||||||||||
2011
|
2010
|
$ | % | 2009 | $ | % | ||||||||||||||||||||||
Revenues
|
$ | 43,717 | $ | 44,641 | $ | (924 | ) | (2.1 | )% | $ | 33,256 | $ | 11,385 | 34.2 | % | |||||||||||||
Gross profit
|
6,772 | 10,289 | (3,517 | ) | (34.2 | ) | 9,032 | 1,257 | 13.9 | |||||||||||||||||||
Gross profit margin
|
15.5 | % | 23.0 | % | n/a | (7.5 | ) | 27.2 | % | n/a | (4.2 | ) | ||||||||||||||||
Operating expenses
|
9,111 | 10,219 | (1,108 | ) | (10.8 | ) | 5,591 | 4,628 | 82.8 | |||||||||||||||||||
Acquisition-related expenses
|
— | — | — | n/m | 22 | (22 | ) | (100.0 | ) | |||||||||||||||||||
Restructuring charges
|
173 | — | 173 | n/m | — | — | n/m | |||||||||||||||||||||
Operating income (loss)
|
(2,512 | ) | 70 | (2,582 | ) | (3,688.6 | ) | 3,419 | (3,349 | ) | (98.0 | ) | ||||||||||||||||
Operating margin
|
(5.7 | )% | 0.2 | % | n/a | (5.9 | ) | 10.3 | % | n/a | (10.1 | ) |
(dollars in thousands)
|
||||||||
2011
|
2010
|
|||||||
Revenues
|
$ | 17,114 | $ | — | ||||
Gross profit
|
8,319 | — | ||||||
Gross profit margin
|
48.6 | % | — | |||||
Operating expenses
|
5,340 | — | ||||||
Acquisition-related expenses
|
3,690 | — | ||||||
Operating loss
|
(711 | ) | — | |||||
Operating margin
|
(4.2 | )% | — |
December 31,
|
||||||||
2011
|
2010
|
|||||||
(In thousands)
|
||||||||
Cash and equivalents
|
$ | 106,129 | $ | 114,829 | ||||
Restricted cash – in escrow
|
82 | 745 |
Payments Due by Period
|
||||||||||||||||||||||||||||
Cash Obligations
(1)(2)(3)(4)(5)(6)
|
Total
|
2012
|
2013
|
2014
|
2015
|
2016
|
Thereafter
|
|||||||||||||||||||||
Long-term debt and notes payable
|
$ | 249,409 | $ | 26,541 | $ | 32,243 | $ | 37,500 | $ | 40,625 | $ | 112,500 | $ | - | ||||||||||||||
Interest on long-term debt
|
23,148 | 6,714 | 5,805 | 4,894 | 3,854 | 1,881 | - | |||||||||||||||||||||
Operating leases
|
38,139 | 12,897 | 9,992 | 7,424 | 4,781 | 2,115 | 930 | |||||||||||||||||||||
Total contractual cash obligations
|
$ | 310,696 | $ | 46,152 | $ | 48,040 | $ | 49,818 | $ | 49,260 | $ | 116,496 | $ | 930 |
(1)
|
Cash obligations are not discounted. See Notes 5 and 9 to the consolidated financial statements contained in this report regarding our long-term debt and credit facility and commitments and contingencies, respectively.
|
(2)
|
Interest on long-term debt was calculated using the current annualized rate on our long-term debt as discussed in Note 5 to the consolidated financial statements contained in this report.
|
(3)
|
At December 31, 2011, we had $16.3 million in earnout liabilities that are expected to be paid out by the end of 2013. See Note 1 to the consolidated financial statements contained in this report for further detail regarding earnout liabilities associated with our 2011 acquisitions.
|
(4)
|
Liabilities related to Financial Accounting Standards Board Accounting Standards Codification 740,
Income Taxes,
have not been included in the table above because we are uncertain as to if or when such amounts may be settled.
|
(5)
|
There were no material purchase commitments at December 31, 2011.
|
(6)
|
Funding for the Corrpro pension scheme was excluded from this table as the amounts are immaterial.
|
·
|
significant underperformance of a segment relative to expected, historical or projected future operating results;
|
·
|
significant negative industry or economic trends;
|
·
|
significant changes in the strategy for a segment including extended slowdowns in the segment’s market;
|
·
|
a decrease in our market capitalization below our book value for an extended period of time; and
|
·
|
a significant change in regulations.
|
Energy and Mining
|
$ | 77.4 | ||
North American Sewer and Water Rehabilitation
|
101.8 | |||
European Sewer and Water Rehabilitation
|
21.8 | |||
Asia-Pacific Sewer and Water Rehabilitation
|
5.7 | |||
Commercial and Structural
|
43.2 | |||
Total goodwill
|
$ | 249.9 |
Management’s Report on Internal Control Over Financial Reporting
|
47 |
Report of Independent Registered Public Accounting Firm
|
48 |
Consolidated Statements of Income for the Years Ended December 31, 2011, 2010 and 2009
|
49 |
Consolidated Balance Sheets, December 31, 2011 and 2010
|
50 |
Consolidated Statements of Equity for the Years Ended December 31, 2011, 2010 and 2009
|
41 |
Consolidated Statements of Cash Flows for the Years Ended December 31, 2011, 2010 and 2009
|
52 |
Notes to Consolidated Financial Statements
|
53 |
/s/ J. Joseph Burgess
|
|
J. Joseph Burgess
President and Chief Executive Officer
(Principal Executive Officer)
|
/s/ David A. Martin
|
|
David A. Martin
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
|
2011
|
2010
|
2009
|
||||||||||
Revenues
|
$ | 938,585 | $ | 914,975 | $ | 726,866 | ||||||
Cost of revenues
|
735,461 | 685,395 | 536,275 | |||||||||
Gross profit
|
203,124 | 229,580 | 190,591 | |||||||||
Operating expenses
|
151,764 | 144,245 | 130,555 | |||||||||
Earnout reversal
|
(1,700 | ) | (1,700 | ) | (1,600 | ) | ||||||
Acquisition-related expenses
|
6,372 | — | 8,494 | |||||||||
Restructuring charges
|
2,151 | — | 4,025 | |||||||||
Operating income
|
44,537 | 87,035 | 49,117 | |||||||||
Other income (expense):
|
||||||||||||
Interest expense
|
(15,075 | ) | (8,691 | ) | (8,296 | ) | ||||||
Interest income
|
347 | 332 | 520 | |||||||||
Other
|
1,955 | (947 | ) | 1,423 | ||||||||
Total other expense
|
(12,773 | ) | (9,306 | ) | (6,353 | ) | ||||||
Income before taxes on income
|
31,764 | 77,729 | 42,764 | |||||||||
Taxes on income
|
7,565 | 23,040 | 12,561 | |||||||||
Income before equity in earnings of affiliated companies
|
24,199 | 54,689 | 30,203 | |||||||||
Equity in earnings of affiliated companies
|
3,471 | 7,291 | 1,192 | |||||||||
Income from continuing operations
|
27,670 | 61,980 | 31,395 | |||||||||
Loss from discontinued operations
|
— | (100 | ) | (4,070 | ) | |||||||
Net income
|
27,670 | 61,880 | 27,325 | |||||||||
Non-controlling interests
|
(1,123 | ) | (1,418 | ) | (1,154 | ) | ||||||
Net income attributable to Aegion Corporation
|
$ | 26,547 | $ | 60,462 | $ | 26,171 | ||||||
Earnings (loss) per share attributable to Aegion Corporation:
|
||||||||||||
Basic:
|
||||||||||||
Income from continuing operations
|
$ | 0.67 | $ | 1.55 | $ | 0.81 | ||||||
Loss from discontinued operations
|
— | (0.01 | ) | (0.11 | ) | |||||||
Net income
|
$ | 0.67 | $ | 1.54 | $ | 0.70 | ||||||
Diluted:
|
||||||||||||
Income from continuing operations
|
$ | 0.67 | $ | 1.54 | $ | 0.81 | ||||||
Loss from discontinued operations
|
— | (0.01 | ) | (0.11 | ) | |||||||
Net income
|
$ | 0.67 | $ | 1.53 | $ | 0.70 |
December 31,
2011
|
December 31,
2010
|
|||||||
Assets
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$ | 106,129 | $ | 114,829 | ||||
Restricted cash
|
82 | 745 | ||||||
Receivables, net
|
228,313 | 178,994 | ||||||
Retainage
|
33,933 | 28,726 | ||||||
Costs and estimated earnings in excess of billings
|
67,683 | 69,544 | ||||||
Inventories
|
54,540 | 42,524 | ||||||
Prepaid expenses and other current assets
|
27,305 | 30,031 | ||||||
Current assets of discontinued operations
|
— | 1,193 | ||||||
Total current assets
|
517,985 | 466,586 | ||||||
Property, plant & equipment,
less accumulated depreciation
|
168,945 | 164,486 | ||||||
Other assets
|
||||||||
Goodwill
|
249,888 | 190,120 | ||||||
Identified intangible assets, less accumulated amortization
|
149,655 | 73,147 | ||||||
Investments
|
26,680 | 27,989 | ||||||
Deferred income tax assets
|
5,418 | 4,115 | ||||||
Other assets
|
6,393 | 4,260 | ||||||
Total other assets
|
438,034 | 299,631 | ||||||
Non-current assets of discontinued operations
|
— | 2,607 | ||||||
Total Assets
|
$ | 1,124,964 | $ | 933,310 | ||||
Liabilities and Equity
|
||||||||
Current liabilities
|
||||||||
Accounts payable
|
72,326 | 74,820 | ||||||
Accrued expenses
|
69,417 | 73,035 | ||||||
Billings in excess of costs and estimated earnings
|
24,435 | 12,612 | ||||||
Current maturities of long-term debt and line of credit
|
26,541 | 13,028 | ||||||
Total current liabilities
|
192,719 | 173,495 | ||||||
Long-term debt,
less current maturities
|
222,868 | 91,715 | ||||||
Deferred income tax liabilities
|
38,167 | 32,330 | ||||||
Other non-current liabilities
|
22,221 | 9,063 | ||||||
Total liabilities
|
475,975 | 306,603 | ||||||
Equity
|
||||||||
Preferred stock, undesignated, $.10 par – shares authorized 2,000,000; none outstanding
|
— | — | ||||||
Common stock, $.01 par – shares authorized 125,000,000; shares issued and outstanding
39,352,375 and 39,246,015, respectively
|
394 | 392 | ||||||
Additional paid‑in capital
|
260,680 | 251,578 | ||||||
Retained earnings
|
373,796 | 347,249 | ||||||
Accumulated other comprehensive income
|
5,862 | 18,113 | ||||||
Total stockholders
'
equity
|
640,732 | 617,332 | ||||||
Non-controlling interests
|
8,257 | 9,375 | ||||||
Total equity
|
648,989 | 626,707 | ||||||
Total Liabilities and Equity
|
$ | 1,124,964 | $ | 933,310 |
Aegion Corporation and Subsidiaries
For the Years Ended December 31, 2011, 2010 and 2009
(In thousands, except number of shares)
|
||||||||||||||||||||||||||||||||
Common Stock
Shares $
|
Additional
Paid-In
Capital
|
Retained Earnings
|
Accumulated
Other
Comprehensive
Income (loss)
|
Non-controlling Interests
|
Total
Stockholders’
Equity
|
Comprehensive
Income
|
||||||||||||||||||||||||||
BALANCE, December 31, 2008
|
27,977,785 | $ | 280 | $ | 109,235 | $ | 260,616 | $ | (2,154 | ) | $ | 3,012 | $ | 370,989 | ||||||||||||||||||
Foreign currency translation revision (See Note 2)
|
4,223 | 4,223 | ||||||||||||||||||||||||||||||
BALANCE (Revised) Dec. 31, 2008
|
27,977,785 | $ | 280 | $ | 109,235 | $ | 260,616 | $ | 2,069 | $ | 3,012 | $ | 375,212 | |||||||||||||||||||
Net income
|
– | – | – | 26,171 | – | 1,154 | 27,325 | $ | 27,325 | |||||||||||||||||||||||
Issuance of common stock, including tax benefits
|
10,573,540 | 106 | 130,297 | – | – | – | 130,403 | – | ||||||||||||||||||||||||
Restricted stock and stock units issued
|
429,725 | 4 | – | – | – | – | 4 | – | ||||||||||||||||||||||||
Issuance of shares pursuant to deferred stock units
|
21,645 | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Forfeitures of restricted stock
|
(68,751 | ) | (1 | ) | – | – | – | – | (1 | ) | – | |||||||||||||||||||||
Equity-based compensation expense
|
– | – | 4,839 | – | – | – | 4,839 | – | ||||||||||||||||||||||||
Dividend to non-controlling interests
|
– | – | – | – | – | (959 | ) | (959 | ) | – | ||||||||||||||||||||||
Purchase of Insituform Linings
|
– | – | (1,808 | ) | – | – | (2,171 | ) | (3,979 | ) | – | |||||||||||||||||||||
Investments by non-controlling interests
|
– | – | – | – | – | 4,107 | 4,107 | – | ||||||||||||||||||||||||
Currency translation adjustment and derivatives
|
– | – | – | – | 16,533 | 327 | 16,860 | 16,860 | ||||||||||||||||||||||||
Total comprehensive income
|
44,185 | |||||||||||||||||||||||||||||||
Less: total comprehensive income attributable to noncontrolling interests
|
(1,481 | ) | ||||||||||||||||||||||||||||||
Total comprehensive income attributable to common stockholders
|
$ | 42,704 | ||||||||||||||||||||||||||||||
BALANCE December 31, 2009
|
38,933,944 | $ | 389 | $ | 242,563 | $ | 286,787 | $ | 18,602 | $ | 5,470 | $ | 553,811 | |||||||||||||||||||
Net income
|
– | – | – | 60,462 | – | 1,418 | 61,880 | $ | 61,880 | |||||||||||||||||||||||
Issuance of common stock, including tax benefits
|
132,485 | 1 | 2,302 | – | – | – | 2,303 | – | ||||||||||||||||||||||||
Restricted shares issued
|
184,656 | 2 | – | – | – | – | 2 | |||||||||||||||||||||||||
Issuance of shares pursuant to restricted stock units
|
32,156 | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Issuance of shares pursuant to deferred stock units
|
9,231 | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Forfeitures of restricted stock
|
(46,457 | ) | – | – | – | – | – | – | – | |||||||||||||||||||||||
Equity-based compensation expense
|
– | – | 6,713 | – | – | – | 6,713 | – | ||||||||||||||||||||||||
Distribution to non-controlling interests
|
– | – | – | – | – | (398 | ) | (398 | ) | – | ||||||||||||||||||||||
Investments by non-controlling interests
|
– | – | – | – | – | 2,578 | 2,578 | – | ||||||||||||||||||||||||
Currency translation adjustment and derivatives
|
– | – | – | – | (489 | ) | 307 | (182 | ) | (182 | ) | |||||||||||||||||||||
Total comprehensive income
|
61,698 | |||||||||||||||||||||||||||||||
Less: total comprehensive income attributable to noncontrolling interests
|
(1,725 | ) | ||||||||||||||||||||||||||||||
Total comprehensive income attributable to common stockholders
|
$ | 59,973 | ||||||||||||||||||||||||||||||
BALANCE December 31, 2010
|
39,246,015 | $ | 392 | $ | 251,578 | $ | 347,249 | $ | 18,113 | $ | 9,375 | $ | 626,707 | |||||||||||||||||||
Net income (loss)
|
– | – | – | 26,547 | – | 1,123 | 27,670 | $ | 27,670 | |||||||||||||||||||||||
Issuance of common stock, including tax benefits
|
128,052 | 1 | 3,610 | – | – | – | 3,611 | – | ||||||||||||||||||||||||
Restricted shares issued
|
168,018 | 2 | – | – | – | – | 2 | – | ||||||||||||||||||||||||
Issuance of shares in connection with Fyfe Group acquisition
|
246,760 | 2 | 3,998 | – | – | – | 4,000 | – | ||||||||||||||||||||||||
Issuance of shares pursuant to restricted stock units
|
9,934 | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Issuance of shares pursuant to deferred stock units
|
20,640 | – | – | – | – | – | – | – | ||||||||||||||||||||||||
Forfeitures of restricted shares
|
(140,448 | ) | – | – | – | – | – | – | – | |||||||||||||||||||||||
Stock repurchase program
|
(326,596 | ) | (3 | ) | (4,997 | ) | – | – | – | (5,000 | ) | – | ||||||||||||||||||||
Equity-based compensation expense
|
– | – | 6,491 | – | – | – | 6,491 | – | ||||||||||||||||||||||||
Investment by non-controlling interests
|
– | – | – | – | – | 546 | 546 | – | ||||||||||||||||||||||||
Distribution to non-controlling interests
|
– | – | – | – | – | (1,661 | ) | (1,661 | ) | – | ||||||||||||||||||||||
Currency translation adjustment and derivatives
|
– | – | – | – | (12,251 | ) | (1,126 | ) | (13,377 | ) | (13,377 | ) | ||||||||||||||||||||
Total comprehensive income
|
14,293 | |||||||||||||||||||||||||||||||
Less: total comprehensive income attributable to noncontrolling interests
|
3 | |||||||||||||||||||||||||||||||
Total comprehensive income attributable to common stockholders
|
$ | 14,296 | ||||||||||||||||||||||||||||||
BALANCE December 31, 2011
|
39,352,375 | $ | 394 | $ | 260,680 | $ | 373,796 | $ | 5,862 | $ | 8,257 | $ | 648,989 |
2011
|
2010
|
2009
|
||||||||||
Cash flows from operating activities
:
|
||||||||||||
Net income
|
$ | 27,670 | $ | 61,880 | $ | 27,325 | ||||||
Loss from discontinued operations
|
– | 100 | 4,070 | |||||||||
Income from continuing operations
|
27,670 | 61,980 | 31,395 | |||||||||
Adjustments to reconcile to net cash provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
36,039 | 30,732 | 28,440 | |||||||||
Equity-based compensation expense
|
6,491 | 6,713 | 4,839 | |||||||||
Deferred income taxes
|
(2,320 | ) | 8,024 | 3,994 | ||||||||
Equity in earnings of affiliated companies
|
(3,471 | ) | (7,291 | ) | (1,192 | ) | ||||||
Earnout reversal
|
(1,700 | ) | (1,700 | ) | (1,600 | ) | ||||||
(Gain) loss on foreign currency transactions
|
(1,155 | ) | 98 | (85 | ) | |||||||
Other
|
200 | (1,173 | ) | (1,345 | ) | |||||||
Changes in operating assets and liabilities:
|
||||||||||||
Restricted cash
|
663 | 538 | 567 | |||||||||
Return on equity method investments
|
7,018 | 7,803 | 2,537 | |||||||||
Receivables net, retainage and costs and estimated earnings in excess of billings
|
(38,310 | ) | (39,214 | ) | (19,363 | ) | ||||||
Inventories
|
(5,992 | ) | (9,677 | ) | 954 | |||||||
Prepaid expenses and other assets
|
2,045 | (539 | ) | 8,991 | ||||||||
Accounts payable and accrued expenses
|
(2,248 | ) | (3,781 | ) | 491 | |||||||
Other operating
|
(2,046 | ) | 962 | (327 | ) | |||||||
Net cash provided by operating activities of continuing operations
|
22,884 | 53,475 | 58,296 | |||||||||
Net cash provided by (used in) operating activities of discontinued operations
|
– | (446 | ) | 6,162 | ||||||||
Net cash provided by operating activities
|
22,884 | 53,029 | 64,458 | |||||||||
Cash flows from investing activities
:
|
||||||||||||
Capital expenditures
|
(21,554 | ) | (36,858 | ) | (21,837 | ) | ||||||
Proceeds from sale of fixed assets
|
755 | 482 | 1,855 | |||||||||
Patent expenditures
|
(1,130 | ) | (1,346 | ) | (2,705 | ) | ||||||
Purchase of CRTS, Hockway and Fyfe NA, net of cash acquired
|
(144,134 | ) | – | – | ||||||||
Purchase of Garneau, Inc. assets and remaining interests in joint ventures
|
– | – | (11,624 | ) | ||||||||
Purchase of Singapore licensee
|
– | (1,257 | ) | – | ||||||||
Proceeds from net foreign investment hedges
|
– | – | 6,818 | |||||||||
Purchase of Bayou and Corrpro, net of cash acquired
|
– | – | (209,714 | ) | ||||||||
Net cash used in investing activities of continuing operations
|
(166,063 | ) | (38,979 | ) | (237,207 | ) | ||||||
Net cash provided by investing activities of discontinued operations
|
– | – | 798 | |||||||||
Net cash used in investing activities
|
(166,063 | ) | (38,979 | ) | (236,409 | ) | ||||||
Cash flows from financing activities
:
|
||||||||||||
Proceeds from issuance of common stock, including tax effect of stock option exercises
|
3,610 | 2,302 | 128,998 | |||||||||
Proceeds from issuance of common stock in connection with acquisition of Fyfe NA
|
4,000 | – | – | |||||||||
Stock repurchase program
|
(5,000 | ) | – | – | ||||||||
Distributions/dividends to noncontrolling interests
|
(1,661 | ) | (398 | ) | (959 | ) | ||||||
Investments by noncontrolling interests
|
546 | 2,578 | 4,107 | |||||||||
Purchase of noncontrolling interests in Insituform Linings
|
– | – | (3,979 | ) | ||||||||
Proceeds from notes payable
|
354 | 1,986 | 2,637 | |||||||||
Principal payments on notes payable
|
(1,499 | ) | (1,808 | ) | (4,159 | ) | ||||||
Credit facility and other financing fees
|
(4,320 | ) | – | – | ||||||||
Principal payments on long-term debt
|
(103,750 | ) | (10,000 | ) | (7,500 | ) | ||||||
Proceeds from long-term debt
|
250,000 | – | 53,700 | |||||||||
Net cash provided by (used in) financing activities
|
142,280 | (5,340 | ) | 172,845 | ||||||||
Effect of exchange rate changes on cash
|
(7,801 | ) | 55 | 5,849 | ||||||||
Net increase (decrease) in cash and cash equivalents for the period
|
(8,700 | ) | 8,765 | 6,743 | ||||||||
Cash and cash equivalents, beginning of year
|
114,829 | 106,064 | 99,321 | |||||||||
Cash and cash equivalents, end of year
|
$ | 106,129 | $ | 114,829 | $ | 106,064 | ||||||
Supplemental disclosures of cash flow information
:
|
||||||||||||
Cash paid for:
|
||||||||||||
Interest
|
$ | 17,231 | $ | 7,046 | $ | 8,173 | ||||||
Net income taxes paid
|
10,077 | 19,001 | 7,143 |
Year Ended
|
||||||||
December 31,
|
||||||||
2011
|
2010
|
|||||||
Revenues
|
$ | 976,621 | $ | 987,610 | ||||
Net income
(1)
|
29,531 | 69,923 |
(1)
|
Includes pro-forma adjustments for purchase price depreciation and amortization as if those intangibles were recorded as of January 1, 2010.
|
CRTS
|
Hockway
|
Fyfe NA
(1)
|
Total
|
|||||||||||||
Cash
|
$ | 24,000 | $ | 4,606 | $ | 118,313 | $ | 146,919 | ||||||||
Estimated fair value of earnout payments to shareholders
|
14,760 | 1,454 | – | 16,214 | ||||||||||||
Total consideration recorded
|
$ | 38,760 | $ | 6,060 | $ | 118,313 | $ | 163,133 |
(1)
|
Includes the cash purchase price at closing of $115.8 million plus a preliminary working capital adjustment to the sellers of $2.5 million, of which $1.8 million was paid in 2011.
|
CRTS
|
Hockway
|
Fyfe NA
|
||||||||||
Cash
|
$ | 361 | $ | 536 | $ | 1,096 | ||||||
Receivables and cost and estimated earnings in excess of billings
|
2,365 | 1,993 | 16,019 | |||||||||
Inventories
|
21 | 623 | 5,977 | |||||||||
Prepaid expenses and other current assets
|
175 | 228 | 792 | |||||||||
Property, plant and equipment
|
5,350 | 324 | 1,064 | |||||||||
Identified intangible assets
|
26,220 | 2,200 | 53,768 | |||||||||
Accounts payable, accrued expenses and billings
in excess of cost and estimated earnings
|
(2,830 | ) | (1,826 | ) | (3,642 | ) | ||||||
Deferred tax liabilities
|
(11,395 | ) | – | – | ||||||||
Total identifiable net assets
|
$ | 20,267 | $ | 4,078 | $ | 75,074 | ||||||
Total consideration recorded
|
$ | 38,760 | $ | 6,060 | $ | 118,313 | ||||||
Less: total identifiable net assets
|
20,267 | 4,078 | 75,074 | |||||||||
Goodwill at December 31, 2011
|
$ | 18,493 | $ | 1,982 | $ | 43,239 |
CRTS
|
Hockway
|
Fyfe NA
|
||||||||||
Total identifiable net assets at acquisition date
|
$ | 19,883 | $ | 4,551 | $ | 69,704 | ||||||
Receivables and cost and estimated earnings in
excess of billings
|
– | (409 | ) | – | ||||||||
Inventories
|
– | (64 | ) | – | ||||||||
Property, plant and equipment
|
4,033 | – | (85 | ) | ||||||||
Identifiable intangible assets
|
(3,105 | ) | – | 5,633 | ||||||||
Accounts payable, accrued expenses and billings in excess of cost and estimated earnings
|
(300 | ) | – | (916 | ) | |||||||
Deferred tax liabilities
|
(244 | ) | – | – | ||||||||
Other adjustments
|
– | – | 738 | |||||||||
Total identifiable net assets at December 31, 2011
|
20,267 | 4,078 | 75,074 | |||||||||
Goodwill at acquisition dates
|
$ | 18,017 | $ | 1,524 | $ | 46,082 | ||||||
Increase (decrease) in goodwill related to acquisitions
|
476 | 458 | (2,843 | ) | ||||||||
Goodwill at December 31, 2011
|
$ | 18,493 | $ | 1,982 | $ | 43,239 |
2011
|
2010
|
2009
|
||||||||||
Weighted average number of common shares used for basic EPS
|
39,362,138 | 39,040,386 | 37,134,295 | |||||||||
Effect of dilutive stock options, restricted stock and deferred stock units (Note 7)
|
336,317 | 373,494 | 379,232 | |||||||||
Weighted average number of common shares and dilutive potential common stock used in diluted EPS
|
39,698,455 | 39,413,880 | 37,513,527 |
·
|
significant underperformance of a reporting unit relative to expected, historical or projected future operating results;
|
·
|
significant negative industry or economic trends;
|
·
|
significant changes in the strategy for a reporting unit including extended slowdowns in a segment’s market;
|
·
|
a decrease in
the Company’s
market capitalization below its book value for an extended period of time; and
|
·
|
a significant change in regulations.
|
Balance sheet data
|
2011
|
2010
|
||||||
Current assets
|
$ | 34,159 | $ | 38,977 | ||||
Non-current assets
|
22,209 | 22,279 | ||||||
Current liabilities
|
16,839 | 18,589 |
Income statement data
|
2011
|
2010
|
2009
|
|||||||||
Revenues
|
$ | 134,716 | $ | 134,884 | $ | 108,567 | ||||||
Gross profit
|
29,651 | 36,095 | 25,029 | |||||||||
Net income
|
12,512 | 19,497 | 6,062 | |||||||||
Equity in earnings of affiliated companies
|
3,471 | 7,291 | 1,192 |
|
•
|
determine whether the entity meets the criteria to qualify as a VIE; and
|
|
•
|
determine whether the Company is the primary beneficiary of the VIE.
|
|
•
|
the design of the entity, including the nature of its risks and the purpose for which the entity was created, to determine the variability that the entity was designed to create and distribute to its interest holders;
|
|
•
|
the nature of the Company’s involvement with the entity;
|
|
•
|
whether control of the entity may be achieved through arrangements that do not involve voting equity;
|
|
•
|
whether there is sufficient equity investment at risk to finance the activities of the entity; and
|
|
•
|
whether parties other than the equity holders have the obligation to absorb expected losses or the right to receive residual returns.
|
|
•
|
whether the entity has the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance; and
|
|
•
|
whether the entity has the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity.
|
Balance sheet data
|
2011
|
2010
|
||||||
Current assets
|
$ | 40,525 | $ | 47,304 | ||||
Non-current assets
|
19,005 | 18,529 | ||||||
Current liabilities
|
23,566 | 29,814 |
Income statement data
|
2011
|
2010
|
2009
|
|||||||||
Revenues
|
$ | 55,792 | $ | 59,419 | $ | 40,132 | ||||||
Gross profit
|
12,005 | 11,544 | 7,209 | |||||||||
Net income
|
1,959 | 1,373 | 2,995 |
2011
|
2010
|
2009
|
||||||||||
Balance, at beginning of year
|
$ | 2,768 | $ | 2,405 | $ | 1,700 | ||||||
Charged to expense
|
397 | 451 | 396 | |||||||||
Write-offs and adjustments
|
144 | (88 | ) | 309 | ||||||||
Balance, at end of year
|
$ | 3,309 | $ | 2,768 | $ | 2,405 |
2011
|
2010
|
|||||||
Costs incurred on uncompleted contracts
|
$ | 599,242 | $ | 569,856 | ||||
Estimated earnings to date
|
171,983 | 120,595 | ||||||
Subtotal
|
771,225 | 690,451 | ||||||
Less – billings to date
|
(727,977 | ) | (633,519 | ) | ||||
Total
|
$ | 43,248 | $ | 56,932 | ||||
Included in the accompanying balance sheets:
|
||||||||
Costs and estimated earnings in excess of billings
|
67,683 | 69,544 | ||||||
Billings in excess of costs and estimated earnings
|
(24,435 | ) | (12,612 | ) | ||||
Total
|
$ | 43,248 | $ | 56,932 |
2011
|
2010
|
|||||||
Raw materials and supplies
|
$ | 17,353 | $ | 10,317 | ||||
Work-in-process
|
6,767 | 5,171 | ||||||
Finished products
|
11,902 | 9,167 | ||||||
Construction materials
|
18,518 | 17,869 | ||||||
Total
|
$ | 54,540 | $ | 42,524 |
Estimated Useful Lives (Years)
|
2011
|
2010
|
||||||||||||
Land and land improvements
|
$ | 12,725 | $ | 12,791 | ||||||||||
Buildings and improvements
|
5 | – | 40 | 64,810 | 64,287 | |||||||||
Machinery and equipment
|
4 | – | 10 | 176,997 | 164,679 | |||||||||
Furniture and fixtures
|
3 | – | 10 | 16,611 | 15,673 | |||||||||
Autos and trucks
|
3 | – | 10 | 48,855 | 48,596 | |||||||||
Construction in progress
|
15,263 | 9,089 | ||||||||||||
Subtotal
|
335,261 | 315,115 | ||||||||||||
Less – Accumulated depreciation
|
(166,316 | ) | (150,629 | ) | ||||||||||
Total
|
$ | 168,945 | $ | 164,486 |
2011
|
2010
|
|||||||
Vendor and other accrued expenses
|
$ | 29,818 | $ | 29,028 | ||||
Estimated casualty and healthcare liabilities
|
13,684 | 17,340 | ||||||
Job costs
|
14,654 | 15,353 | ||||||
Accrued compensation
|
10,454 | 9,936 | ||||||
Income tax payable and deferred income taxes
|
807 | 1,378 | ||||||
Total
|
$ | 69,417 | $ | 73,035 |
2011
|
2010
|
|||||||
Energy and Mining
|
$ | 77.4 | $ | 57.5 | ||||
North American Sewer and Water Rehabilitation
|
101.8 | 103.3 | ||||||
European Sewer and Water Rehabilitation
|
21.8 | 23.6 | ||||||
Asia-Pacific Sewer and Water Rehabilitation
|
5.7 | 5.7 | ||||||
Commercial and Structural
|
43.2 | – | ||||||
Total goodwill
|
$ | 249.9 | $ | 190.1 |
2011
|
2010
|
|||||||
Beginning balance (January 1, 2011 and 2010, respectively)
(1)
|
$ | 190.1 | $ | 188.6 | ||||
Additions to goodwill through acquisitions
(2)(3)
|
63.7 | 1.6 | ||||||
Foreign currency translation
|
(3.9 | ) | (0.1 | ) | ||||
Goodwill at end of period
(4)
|
$ | 249.9 | $ | 190.1 |
|
(1)
|
During 2011, the Company revised previously reported goodwill balances related to foreign currency translation. As a result of this revision, goodwill as of January 1, 2010 was revised from the previously reported amount of $182.1 million to $188.6 million. See Note 2 for additional information.
|
|
(2)
|
During 2010, the Company recorded goodwill of $1.6 million related to the acquisition of its licensee in Singapore.
|
|
(3)
|
During 2011, the Company recorded goodwill of $18.5 million related to the acquisition of CRTS, $2.0 million related to the acquisition of Hockway and $43.2 million related to the acquisition of Fyfe NA as discussed in Note 1.
|
|
(4)
|
The Company does not have any accumulated impairment charges.
|
As of December 31, 2011
(1)
|
As of December 31, 2010
|
|||||||||||||||||||||||||||
Weighted Average Useful Lives (Years)
|
Gross Carrying Amount
|
Accumulated Amortization
|
Net Carrying Amount
|
Gross Carrying Amount
|
Accumulated Amortization
|
Net Carrying Amount
|
||||||||||||||||||||||
License agreements
|
8 | $ | 3,922 | $ | (2,654 | ) | $ | 1,268 | $ | 3,895 | $ | (2,465 | ) | $ | 1,430 | |||||||||||||
Backlog
|
1 | 4,651 | (3,705 | ) | 946 | 3,010 | (2,999 | ) | 11 | |||||||||||||||||||
Leases
|
13 | 2,067 | (183 | ) | 1,884 | 1,237 | (95 | ) | 1,142 | |||||||||||||||||||
Trademarks
|
13 | 21,396 | (2,141 | ) | 19,255 | 14,948 | (1,290 | ) | 13,658 | |||||||||||||||||||
Non-competes
|
3 | 740 | (729 | ) | 11 | 740 | (589 | ) | 151 | |||||||||||||||||||
Customer relationships
|
14 | 102,963 | (10,970 | ) | 91,994 | 53,307 | (6,530 | ) | 46,777 | |||||||||||||||||||
Patents and acquired technology
|
15 | 53,906 | (19,608 | ) | 34,298 | 24,947 | (14,969 | ) | 9,978 | |||||||||||||||||||
$ | 189,645 | $ | (39,990 | ) | $ | 149,655 | $ | 102,084 | $ | (28,937 | ) | $ | 73,147 |
(1)
|
During 2011, the Company recorded (i) $1.6 million in backlog to be amortized over the weighted average life of one year, (ii) $6.4 million in trademarks and trade names to be amortized over a weighted average life of 20 years, (iii) $0.8 million in leases to be amortized over a weighted average life of ten years, (iv) $49.7 million in customer relationships to be amortized over a weighted average life of 18 years and (v) $23.7 million in patents and acquired technology to be amortized over a weighted average life of 19 years related to the acquisitions discussed in Note 1.
|
Year
|
Amount
|
|||
2012
|
$ | 10,614 | ||
2013
|
9,664 | |||
2014
|
9,664 | |||
2015
|
9,664 | |||
2016
|
9,663 |
5.
|
LONG-TERM DEBT AND CREDIT FACILITY
|
2011
|
2010
|
|||||||
Term note, current annualized rate 2.74% due August 31, 2016
|
$ | 243,750 | $ | 32,500 | ||||
6.54% Senior Notes, Series 2003-A, due April 24, 2013
|
– | 65,000 | ||||||
Other notes with interest rates from 5.0% to 10.5%
|
5,659 | 7,243 | ||||||
Subtotal
|
249,409 | 104,743 | ||||||
Less – Current maturities and notes payable
|
26,541 | 13,028 | ||||||
Total
|
$ | 222,868 | $ | 91,715 |
Year
|
Amount
|
|||
2012
|
$ | 26,541 | ||
2013
|
32,243 | |||
2014
|
37,500 | |||
2015
|
40,625 | |||
2016
|
112,500 | |||
Total
|
$ | 249,409 |
For the Years Ended December 31,
|
||||||||||||||||||||||||
2011
|
2010
|
2009
|
||||||||||||||||||||||
Stock Awards
|
Weighted
Average
Award Date
Fair Value
|
Stock Awards
|
Weighted
Average
Award Date
Fair Value
|
Stock Awards
|
Weighted
Average
Award Date
Fair Value
|
|||||||||||||||||||
Outstanding, beginning of period
|
888,855 | $ | 15.25 | 806,643 | $ | 13.64 | 475,787 | $ | 14.25 | |||||||||||||||
Restricted shares awarded
|
168,018 | 26.41 | 184,656 | 22.87 | 399,507 | 13.26 | ||||||||||||||||||
Restricted stock units awarded
|
6,768 | 26.60 | 17,115 | 24.97 | 30,218 | 13.66 | ||||||||||||||||||
Restricted shares distributed
|
(270,142 | ) | 13.38 | (22,838 | ) | 13.12 | (43,241 | ) | 15.96 | |||||||||||||||
Restricted stock units distributed
|
(9,934 | ) | 11.19 | (32,156 | ) | 19.34 | (3,846 | ) | 25.60 | |||||||||||||||
Restricted shares forfeited
|
(140,448 | ) | 23.01 | (46,457 | ) | 18.12 | (50,649 | ) | 13.22 | |||||||||||||||
Restricted stock units forfeited
|
– | – | (18,108 | ) | 14.53 | (1,133 | ) | 25.60 | ||||||||||||||||
Outstanding, end of period
|
643,117 | $ | 17.44 | 888,855 | $ | 15.25 | 806,643 | $ | 13.64 |
For the Years Ended December 31,
|
||||||||||||||||||||||||
2011
|
2010
|
2009
|
||||||||||||||||||||||
Deferred
Stock
Units
|
Weighted
Average
Award Date
Fair Value
|
Deferred
Stock
Units
|
Weighted
Average
Award Date
Fair Value
|
Deferred
Stock
Units
|
Weighted
Average
Award Date
Fair Value
|
|||||||||||||||||||
Outstanding, beginning of period
|
163,318 | $ | 19.43 | 147,374 | $ | 18.22 | 130,018 | $ | 18.46 | |||||||||||||||
Awarded
|
31,238 | 23.75 | 25,175 | 26.10 | 39,001 | 16.85 | ||||||||||||||||||
Shares distributed
|
(20,640 | ) | 20.13 | (9,231 | ) | 18.38 | (21,645 | ) | 17.14 | |||||||||||||||
Outstanding, end of period
|
173,916 | $ | 20.12 | 163,318 | $ | 19.43 | 147,374 | $ | 18.22 |
2011
|
2010
|
2009
|
||||||||||||||||||||||||||||||
Range
|
Weighted
Average
|
Range
|
Weighted
Average
|
Range
|
Weighted
Average
|
|||||||||||||||||||||||||||
Weighted average grant-date fair value
|
n/a | $ | 11.61 | n/a | $ | 10.56 | n/a | $ | 5.98 | |||||||||||||||||||||||
Volatility
|
47.0 | % | – | 50.6 | % | 50.4 | % | 50.4 | % | 50.4 | % | 49.4 | % | – | 50.1 | % | 50.1 | % | ||||||||||||||
Expected term (years)
|
7.0 | 7.0 | 7.0 | 7.0 | 7.0 | 7.0 | ||||||||||||||||||||||||||
Dividend yield
|
0.0 | % | 0.0 | % | 0.0 | % | 0.0 | % | 0.0 | % | 0.0 | % | ||||||||||||||||||||
Risk-free rate
|
2.3 | % | – | 3.0 | % | 2.8 | % | 3.1 | % | 3.1 | % | 2.5 | % | – | 3.2 | % | 2.5 | % |
2011
|
2010
|
2009
|
||||||||||||||||||||||
Shares
|
Weighted
Average
Exercise
Price
|
Shares
|
Weighted
Average
Exercise
Price
|
Shares
|
Weighted
Average
Exercise
Price
|
|||||||||||||||||||
Outstanding at January 1
|
1,198,516 | $ | 18.42 | 1,167,640 | $ | 17.71 | 1,032,773 | $ | 19.18 | |||||||||||||||
Granted
|
225,505 | 26.92 | 215,722 | 22.87 | 340,609 | 12.83 | ||||||||||||||||||
Exercised
|
(128,052 | ) | 16.48 | (132,485 | ) | 17.16 | (74,524 | ) | 15.30 | |||||||||||||||
Forfeited/expired
|
(188,257 | ) | 26.62 | (52,361 | ) | 25.53 | (131,218 | ) | 18.20 | |||||||||||||||
Outstanding at December 31
|
1,107,712 | $ | 18.98 | 1,198,516 | $ | 18.42 | 1,167,640 | $ | 17.71 | |||||||||||||||
Exercisable at December 31
|
690,449 | $ | 16.82 | 678,649 | $ | 19.37 | 633,789 | $ | 21.30 |
2011
|
2010
|
2009
|
||||||||||||
(in millions)
|
||||||||||||||
Amount collected from stock option exercises
|
$ | 2.1 | $ | 2.3 | $ | 1.1 | ||||||||
Total intrinsic value of stock option exercises
|
1.1 | 1.2 | 0.4 | |||||||||||
Tax benefit of stock option exercises recorded in additional paid-in-capital
|
0.1 | < |
0.1
|
< |
0.1
|
|||||||||
Aggregate intrinsic value of outstanding stock options
|
1.0 | 8.6 | 6.9 | |||||||||||
Aggregate intrinsic value of exercisable stock options
|
0.8 | 4.5 | 2.0 |
2011
|
2010
|
2009
|
||||||||||
Domestic
|
$ | (381 | ) | $ | 40,941 | $ | 23,569 | |||||
Foreign
|
32,145 | 36,788 | 19,195 | |||||||||
Total
|
$ | 31,764 | $ | 77,729 | $ | 42,764 |
2011
|
2010
|
2009
|
||||||||||
Current:
|
||||||||||||
Federal
|
$ | 948 | $ | 5,361 | $ | 2,745 | ||||||
Foreign
|
8,878 | 8,051 | 8,280 | |||||||||
State
|
316 | 1,435 | 1,132 | |||||||||
Subtotal
|
10,142 | 14,847 | 12,157 | |||||||||
Deferred:
|
||||||||||||
Federal
|
(1,700 | ) | 6,768 | 1,094 | ||||||||
Foreign
|
492 | 832 | (1,416 | ) | ||||||||
State
|
(1,369 | ) | 593 | 726 | ||||||||
Subtotal
|
(2,577 | ) | 8,193 | 404 | ||||||||
Total tax provision
|
$ | 7,565 | $ | 23,040 | $ | 12,561 |
2011
|
2010
|
2009
|
||||||||||
Income taxes at U.S. federal statutory tax rate
|
$ | 11,117 | $ | 27,205 | $ | 14,967 | ||||||
Increase (decrease) in taxes resulting from:
|
||||||||||||
State income taxes, net of federal income tax benefit
|
(639 | ) | 1,369 | 1,208 | ||||||||
Transaction costs
|
574 | — | 586 | |||||||||
Meals and entertainment
|
570 | 531 | 365 | |||||||||
Changes in taxes previously accrued
|
158 | (155 | ) | (621 | ) | |||||||
Foreign tax rate differences
|
(3,412 | ) | (4,335 | ) | (2,453 | ) | ||||||
Recognition of uncertain tax positions
|
(214 | ) | (453 | ) | (191 | ) | ||||||
Other matters
|
(589 | ) | (1,122 | ) | (1,300 | ) | ||||||
Total tax provision
|
$ | 7,565 | $ | 23,040 | $ | 12,561 | ||||||
Effective tax rate
|
23.8 | % | 29.6 | % | 29.4 | % |
2011
|
2010
|
|||||||
Deferred income tax assets:
|
||||||||
Foreign tax credit carryforwards
|
$ | 483 | $ | 526 | ||||
Net operating loss carryforwards
|
14,366 | 12,463 | ||||||
Accrued expenses
|
11,015 | 10,259 | ||||||
Other
|
8,563 | 4,064 | ||||||
Total gross deferred income tax assets
|
34,427 | 27,312 | ||||||
Less valuation allowance
|
(4,691 | ) | (5,083 | ) | ||||
Net deferred income tax assets
|
29,736 | 22,229 | ||||||
Deferred income tax liabilities:
|
||||||||
Property, plant and equipment
|
(16,127 | ) | (14,256 | ) | ||||
Intangible assets
|
(27,088 | ) | (18,097 | ) | ||||
Undistributed foreign earnings
|
(7,051 | ) | (7,051 | ) | ||||
Other
|
(11,721 | ) | (7,364 | ) | ||||
Total deferred income tax liabilities
|
(61,987 | ) | (46,768 | ) | ||||
Net deferred income tax assets (liabilities)
|
$ | (32,251 | ) | $ | (24,539 | ) |
2011
|
2010
|
|||||||
Current deferred income tax assets, net
|
$ | 3,728 | $ | 4,787 | ||||
Current deferred income tax liabilities, net
|
(3,230 | ) | (1,111 | ) | ||||
Noncurrent deferred income tax assets, net
|
5,418 | 4,115 | ||||||
Noncurrent deferred income tax liabilities, net
|
(38,167 | ) | (32,330 | ) | ||||
Net deferred income tax assets (liabilities)
|
$ | (32,251 | ) | $ | (24,539 | ) |
2011
|
2010
|
2009
|
||||||||||
Balance, at beginning of year
|
$ | 5,083 | $ | 4,857 | $ | 2,993 | ||||||
Additions
|
1,058 | 499 | 492 | |||||||||
Reversals
|
(1,352 | ) | (570 | ) | (309 | ) | ||||||
Other adjustments
|
(98 | ) | 297 | 1,681 | ||||||||
Balance, at end of year
|
$ | 4,691 | $ | 5,083 | $ | 4,857 |
2011
|
2010
|
2009
|
||||||||||
Balance at January 1,
|
$ | 1,672 | $ | 2,624 | $ | 1,010 | ||||||
Additions for tax positions of prior years
|
41 | 77 | 2,052 | |||||||||
Reductions for tax positions of prior years
|
(238 | ) | – | – | ||||||||
Lapse in statute of limitations
|
(406 | ) | (1,076 | ) | (618 | ) | ||||||
Foreign currency translation
|
(19 | ) | 47 | 180 | ||||||||
Balance at December 31, total tax provision
|
$ | 1,050 | $ | 1,672 | $ | 2,624 |
Year
|
Minimum Lease Payments
|
|||
2012
|
$ | 12,897 | ||
2013
|
9,992 | |||
2014
|
7,424 | |||
2015
|
4,781 | |||
2016
|
2,115 | |||
Thereafter
|
930 | |||
Total
|
$ | 38,139 |
Designation of Derivatives
|
Balance Sheet Location
|
December 31, 2011
|
December 31, 2010
|
|||||||
Derivatives Designated as Hedging Instruments
|
||||||||||
Forward Currency Contracts
|
Other current liabilities
|
$ | 6 | $ | 126 | |||||
Interest Rate Swaps
|
Other long-term liabilities
|
545 | 202 | |||||||
Total Liabilities
|
$ | 551 | $ | 328 | ||||||
Derivatives Not Designated as Hedging Instruments
|
||||||||||
Forward Currency Contracts
|
Other current assets
|
$ | 9 | $ | – | |||||
Total Assets
|
$ | 9 | – | |||||||
Forward Currency Contracts
|
Other current liabilities
|
$ | 69 | $ | 16 | |||||
Total Derivative Assets
|
9 | – | ||||||||
Total Derivative Liabilities
|
620 | 344 | ||||||||
Total Net Derivative Liability
|
$ | 611 | $ | 344 |
Total Fair Value at December 31, 2011
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
Significant Observable Inputs (Level 2)
|
Significant Unobservable Inputs
(Level 3)
|
|||||||||||||
Assets
|
||||||||||||||||
Forward Currency Contracts
|
$ | 9 | – | $ | 9 | – | ||||||||||
Total
|
$ | 9 | – | $ | 9 | – | ||||||||||
Liabilities
|
||||||||||||||||
Forward Currency Contracts
|
$ | 75 | – | $ | 75 | – | ||||||||||
Interest Rate Swap
|
545 | – | 545 | – | ||||||||||||
Total
|
$ | 620 | – | $ | 620 | – |
Total Fair Value at December 31, 2010
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
Significant Observable Inputs (Level 2)
|
Significant Unobservable Inputs
(Level 3)
|
|||||||||||||
Liabilities
|
||||||||||||||||
Forward Currency Contracts
|
$ | 142 | – | $ | 142 | – | ||||||||||
Interest Rate Swap
|
202 | – | 202 | – | ||||||||||||
Total
|
$ | 344 | – | $ | 344 | – |
Position
|
Notional
Amount
|
Weighted
Average
Remaining
Maturity
In Years
|
Average
Exchange
Rate
|
||||||||||
Canadian Dollar/USD
|
Sell
|
$ | 10,370,000 | 0.7 | 1.03 | ||||||||
British Pound/USD
|
Sell
|
£ | 200,000 | 0.2 | 1.13 | ||||||||
Interest Rate Swap
|
$ | 80,925,000 | 2.9 |
2010
|
2009
|
|||||||
Revenues
|
$ | 140 | $ | (4,604 | ) | |||
Gross profit (loss)
|
95 | (3,798 | ) | |||||
Operating expenses
|
266 | 2,234 | ||||||
Operating loss
|
(171 | ) | (6,032 | ) | ||||
Loss before tax benefits
|
(166 | ) | (5,813 | ) | ||||
Tax benefits
|
66 | 1,743 | ||||||
Net loss
|
(100 | ) | (4,070 | ) |
2010
|
||||
Receivables, retainage, costs and estimated earnings in excess of billings and other current assets.
|
$ | 1,193 | ||
Property, plant and equipment, less accumulated depreciation
|
1,283 | |||
Deferred income tax assets
|
1,324 | |||
Total assets
|
$ | 3,800 |
2011
|
2010
|
2009
|
||||||||||
Revenues:
|
||||||||||||
Energy and Mining
|
$ | 433,230 | $ | 382,246 | $ | 241,678 | ||||||
North American Sewer and Water Rehabilitation
|
357,507 | 413,828 | 365,889 | |||||||||
European Sewer and Water Rehabilitation
|
87,017 | 74,260 | 86,043 | |||||||||
Asia-Pacific Sewer and Water Rehabilitation
|
43,717 | 44,641 | 33,256 | |||||||||
Commercial and Structural
|
17,114 | – | – | |||||||||
Total revenues
|
$ | 938,585 | $ | 914,975 | $ | 726,866 | ||||||
Operating income (loss):
|
||||||||||||
Energy and Mining
|
$ | 35,011 | $ | 41,121 | $ | 10,924 | ||||||
North American Sewer and Water Rehabilitation
|
6,749 | 40,831 | 36,050 | |||||||||
European Sewer and Water Rehabilitation
|
6,000 | 5,013 | (1,276 | ) | ||||||||
Asia-Pacific Sewer and Water Rehabilitation
|
(2,512 | ) | 70 | 3,419 | ||||||||
Commercial and Structural
|
(711 | ) | – | – | ||||||||
Total operating income
|
$ | 44,537 | $ | 87,035 | $ | 49,117 | ||||||
Total assets:
|
||||||||||||
Energy and Mining
|
$ | 479,194 | $ | 390,592 | $ | 334,925 | ||||||
North American Sewer and Water Rehabilitation
|
281,353 | 310,839 | 302,806 | |||||||||
European Sewer and Water Rehabilitation
|
62,791 | 60,861 | 76,235 | |||||||||
Asia-Pacific Sewer and Water Rehabilitation
|
76,932 | 63,100 | 51,873 | |||||||||
Commercial and Structural
|
128,358 | – | – | |||||||||
Corporate
|
96,336 | 104,118 | 96,251 | |||||||||
Discontinued operations
|
– | 3,800 | 4,493 | |||||||||
Total assets
|
$ | 1,124,964 | $ | 933,310 | $ | 866,583 | ||||||
Capital expenditures:
|
||||||||||||
Energy and Mining
|
$ | 11,375 | $ | 14,603 | $ | 3,890 | ||||||
North American Sewer and Water Rehabilitation
|
3,378 | 13,256 | 8,988 | |||||||||
European Sewer and Water Rehabilitation
|
1,798 | 1,768 | 1,858 | |||||||||
Asia-Pacific Sewer and Water Rehabilitation
|
1,908 | 5,094 | 5,567 | |||||||||
Commercial and Structural
|
43 | – | – | |||||||||
Corporate
|
3,052 | 2,137 | 1,534 | |||||||||
Total capital expenditures
|
$ | 21,554 | $ | 36,858 | $ | 21,837 | ||||||
Depreciation and amortization:
|
||||||||||||
Energy and Mining
|
$ | 16,613 | $ | 14,504 | $ | 12,129 | ||||||
North American Sewer and Water Rehabilitation
|
9,405 | 9,796 | 10,106 | |||||||||
European Sewer and Water Rehabilitation
|
2,007 | 2,047 | 2,347 | |||||||||
Asia-Pacific Sewer and Water Rehabilitation
|
2,728 | 2,060 | 1,313 | |||||||||
Commercial and Structural
|
1,183 | – | – | |||||||||
Corporate
|
4,103 | 2,325 | 2,545 | |||||||||
Total depreciation and amortization
|
$ | 36,039 | $ | 30,732 | $ | 28,440 |
2011
|
2010
|
2009
|
||||||||||
Revenues:
|
||||||||||||
United States
|
$ | 552,197 | $ | 604,372 | $ | 480,684 | ||||||
Canada
|
178,739 | 139,632 | 95,761 | |||||||||
Europe
|
102,471 | 87,616 | 95,910 | |||||||||
Other foreign
|
105,178 | 83,355 | 54,511 | |||||||||
Total revenues
|
$ | 938,585 | $ | 914,975 | $ | 726,866 | ||||||
Operating income (loss):
|
||||||||||||
United States
|
$ | (2,212 | ) | $ | 40,172 | $ | 25,004 | |||||
Canada
|
31,892 | 30,958 | 17,790 | |||||||||
Europe
|
9,391 | 9,041 | (11 | ) | ||||||||
Other foreign
|
5,466 | 6,864 | 6,334 | |||||||||
Total operating income
|
$ | 44,537 | $ | 87,035 | $ | 49,117 | ||||||
Long-lived assets:
(1)
|
||||||||||||
United States
|
$ | 153,853 | $ | 147,572 | $ | 131,447 | ||||||
Canada
|
22,998 | 20,564 | 25,371 | |||||||||
Europe
|
12,474 | 13,596 | 21,173 | |||||||||
Other foreign
|
12,693 | 15,003 | 9,052 | |||||||||
Total long-lived assets
|
$ | 202,018 | $ | 196,735 | $ | 187,043 |
(1)
|
Long lived assets as of December 31, 2011, 2010 and 2009 do not include intangible assets, goodwill or deferred tax assets.
|
First
Quarter
|
Second Quarter
|
Third Quarter
|
Fourth Quarter
|
|||||||||||||
Year ended December 31, 2011:
|
||||||||||||||||
Revenues
|
$ | 210,587 | $ | 224,985 | $ | 246,218 | $ | 256,795 | ||||||||
Gross profit
|
41,174 | 45,840 | 52,629 | 63,481 | ||||||||||||
Operating income
|
5,489 | 7,840 | 9,498 | 21,710 | ||||||||||||
Net income
|
3,006 | 7,629 | 1,160 | 14,752 | ||||||||||||
Basic earnings per share:
|
||||||||||||||||
Net income
|
$ | 0.08 | $ | 0.19 | $ | 0.03 | $ | 0.37 | ||||||||
Diluted earnings per share
|
||||||||||||||||
Net income
|
$ | 0.08 | $ | 0.19 | $ | 0.03 | $ | 0.37 |
Year ended December 31, 2010:
|
||||||||||||||||
Revenues
|
$ | 199,182 | $ | 230,192 | $ | 239,585 | $ | 246,016 | ||||||||
Gross profit
|
48,680 | 59,199 | 61,419 | 60,282 | ||||||||||||
Operating income
|
12,506 | 22,747 | 26,955 | 24,827 | ||||||||||||
Income from continuing operations
|
8,510 | 15,805 | 18,826 | 17,421 | ||||||||||||
Loss from discontinued operations
|
(49 | ) | (28 | ) | (16 | ) | (7 | ) | ||||||||
Net income
|
8,461 | 15,777 | 18,810 | 17,414 | ||||||||||||
Basic earnings per share:
|
||||||||||||||||
Income from continuing operations
|
$ | 0.22 | $ | 0.40 | $ | 0.48 | $ | 0.44 | ||||||||
Loss from discontinued operations
|
(0.00 | ) | (0.00 | ) | (0.00 | ) | (0.00 | ) | ||||||||
Net income
|
$ | 0.22 | $ | 0.40 | $ | 0.48 | $ | 0.44 | ||||||||
Diluted earnings per share
|
||||||||||||||||
Income from continuing operations
|
$ | 0.22 | $ | 0.40 | $ | 0.48 | $ | 0.44 | ||||||||
Loss from discontinued operations
|
(0.00 | ) | (0.00 | ) | (0.00 | ) | (0.00 | ) | ||||||||
Net income
|
$ | 0.22 | $ | 0.40 | $ | 0.48 | $ | 0.44 |
Dated: February 28, 2012 | AEGION CORPORATION | ||
|
By:
|
/s/ J. Joseph Burgess | |
J. Joseph Burgess | |||
President and Chief Executive Officer |
Signature
|
Title |
Date
|
|
/s/ J. Joseph Burgess
|
Principal Executive Officer and
|
February 28, 2012
|
|
J. Joseph Burgess
|
Director
|
||
/s/ David A. Martin
|
Principal Financial Officer and
|
February 28, 2012
|
|
David A. Martin
|
Principal Accounting Officer
|
||
/s/ Stephen P. Cortinovis
|
Director
|
February 28, 2012
|
|
Stephen P. Cortinovis
|
|||
/s/ Stephanie A. Cuskley
|
Director
|
February 28, 2012
|
|
Stephanie A. Cuskley
|
|||
/s/ John P. Dubinsky
|
Director
|
February 28, 2012
|
|
John P. Dubinsky
|
|||
/s/ Charles R. Gordon
|
Director
|
February 28, 2012
|
|
Charles R. Gordon
|
|||
/s/ Juanita H. Hinshaw
|
Director
|
February 28, 2012
|
|
Juanita H. Hinshaw
|
|||
/s/ M. Richard Smith
|
Director
|
February 28, 2012
|
|
M. Richard Smith
|
|||
/s/ Alfred L. Woods
|
Director
|
February 28, 2012
|
|
Alfred L. Woods
|
/s/ Phillip D. Wright
|
Director
|
February 28, 2012
|
|
Phillip D. Wright
|
3.1
|
Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the current report on Form 8-K12B filed on October 26, 2011), and Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred Stock (incorporated by reference to Exhibit 3.3 to the current report on Form 8-K12B filed on October 26, 2011).
|
3.2
|
By-Laws of the Company (incorporated by reference to Exhibit 3.2 to the current report on Form 8-K12B filed October 26, 2011).
|
4.1
|
Rights Agreement dated as of October 6, 2011 between Aegion Corporation and American Stock Transfer & Trust Company (incorporated by reference to Exhibit 4.1 to the current report on Form 8-K12B filed on October 26, 2011).
|
10.1
|
Agreement of Merger and Plan of Reorganization, dated October 19, 2011, by and among Insituform Technologies, Inc., Aegion Corporation and Insituform MergerSub, Inc. (incorporated by reference to Exhibit 2.1 to the current report on Form 8-K12B filed October 26, 2011).
|
10.2
|
Assignment and Assumption Agreement, dated October 25, 2011, between Insituform Technologies, Inc. and Aegion Corporation (incorporated by reference to Exhibit 10.1 to the current report on Form 8-K12B filed October 26, 2011).
|
10.3
|
Amended and Restated 2001 Employee Equity Incentive Plan of the Company (incorporated by reference to Appendix C to the definitive proxy statement on Schedule 14A filed on April 16, 2003 in connection with the 2003 annual meeting of stockholders). (2)
|
10.4
|
Amended and Restated 2001 Non-Employee Director Equity Incentive Plan of the Company (incorporated by reference to Appendix B to the definitive proxy statement on Schedule 14A filed on April 16, 2003 in connection with the 2003 annual meeting of stockholders). (2)
|
10.5
|
2006 Employee Equity Incentive Plan of the Company (incorporated by reference to Appendix C to the definitive proxy statement on Schedule 14A filed on March 10, 2006 in connection with the 2006 annual meeting of stockholders), as amended on April 14, 2006 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed on April 14, 2006). (2)
|
10.6
|
2009 Employee Equity Incentive Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed on March 25, 2009, as revised on April 7, 2009, in connection with the 2009 annual meeting of stockholders). (2)
|
10.7
|
2006 Non-Employee Director Equity Incentive Plan of the Company (incorporated by reference to Appendix B to the definitive proxy statement on Schedule 14A filed on March 10, 2006 in connection with the 2006 annual meeting of stockholders). (2)
|
10.8
|
Employee Stock Purchase Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed on March 15, 2007 in connection with the 2007 annual meeting of stockholders). (2)
|
10.9
|
Senior Management Voluntary Deferred Compensation Plan of the Company, as amended and restated (incorporated by reference to Exhibit 10.13 to the annual report on Form 10-K for the year ended December 31, 2008). (2)
|
10.10
|
First Amendment to Senior Management Voluntary Deferred Compensation Plan of the Company, as amended and restated, filed herewith. (2)
|
10.11
|
2011 Non-Employee Director Equity Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed on March 18, 2011 in connection with the 2011 annual meeting of stockholders). (2)
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document*
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document*
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document*
|
(1)
|
The Company’s current, quarterly and annual reports are filed with the Securities and Exchange Commission under file no. 0-10786.
|
(2)
|
Management contract or compensatory plan or arrangement.
|
1.
|
By changing the name of the Plan and all references thereto to “Aegion Corporation Senior Management Voluntary Deferred Compensation Plan (Amended and Restated as of January 1, 2008)”
|
2.
|
By changing all references to “Insituform Technologies, Inc.” wherever they may appear in the Plan to “Aegion Corporation.”
|
Aegion Corporation | |||
|
By:
|
/s/ David F. Morris | |
Title: |
SVP, CAO, General Counsel
|
||
and Secretary
|
|
(i)
|
losses associated with the write-down of assets of a subsidiary, business unit or division that has been designated by the Board of Directors as a discontinued business operation or to be liquidated;
|
|
(ii)
|
gains or losses on the sale of any subsidiary, business unit or division, or the assets or business thereof;
|
|
(iii)
|
gains or losses from the disposition of material capital assets (other than in a transaction described in subsection (ii)) or the refinancing of indebtedness, including, among other things, any make-whole payments and prepayment fees;
|
|
(iv)
|
losses associated with the write-down of goodwill or other intangible assets of the Company due to the determination under applicable accounting standards that the assets have been impaired;
|
|
(v)
|
gains or losses from material property casualty occurrences or condemnation awards taking into account the proceeds paid by insurance companies and other third parties in connection with the casualty or condemnation;
|
|
(vi)
|
any other material income or loss item the realization of which is not directly attributable to the actions of current senior management of the Company;
|
|
(vii)
|
any income statement effect resulting from a change in generally accepted accounting principles, except to the extent the effect of such a change is already reflected in the target Net Income amount; and
|
|
(viii)
|
the income taxes (benefits) of any of the above-designated gains or losses.
|
|
§
|
If Actual Net Income equals the Net Income Target, the Consolidated Company Financial Performance Pool shall be equal to the Company Target.
|
|
§
|
If Actual Net Income exceeds the Net Income Target, the Consolidated Company Financial Performance Pool shall equal (1) the Company Target plus (2) $0.33 of each dollar by which the Actual Net Income exceeds the Net Income Target (for each dollar of Actual Net Income greater than 100% of the Net Income Target up to 110% of the Net Income Target)
plus
(3) $0.50 of each dollar by which the Actual Net Income exceeds the Net Income Target (for each dollar of Actual Net Income greater than 110% of the Net Income Target).
|
|
§
|
If Actual Net Income is less than the Net Income Target, but equals or exceeds 75% of the Net Income Target, the Consolidated Company Financial Performance Pool shall be equal to the Company Target multiplied by the percentage determined by dividing the Actual Net Income by the Net Income Target.
|
|
§
|
If Actual Net Income is less than 75% of the Net Income Target, the minimum amount funded to the Consolidated Company Financial Performance Pool shall be equal to $700,000;
provided, however
, that such minimum amount shall only be awarded to individual Participants for extraordinary performance, as determined by the Company’s Chief Executive Officer in his sole discretion (subject to the review and approval by the Compensation Committee of any Awards to executive officers of the Company).
|
|
§
|
The “BU Target” shall be equal to 90% of the sum of the business unit Participants’ Goals for the Plan Year for the Participants in the Plan at the time the award is to be paid.
|
|
§
|
If Actual Operating Income is equal to 90% but less than 100% of the Operating Income Target, the Business Unit/Individual Performance Pool shall be equal to the BU Target
multiplied by
the percentage determined by dividing the Actual Operating Income by the Operating Income Target. If Actual Operating Income equals or exceeds the Operating Income Target, the Business Unit/Individual Performance Pool shall equal (1) the BU Target plus (2) $0.33 of each dollar by which the Actual Operating Income exceeds the Operating Income Target (for each dollar of Actual Operating Income greater than 100% of the Operating Income Target up to 110% of the Operating Income Target),
plus
(3) $0.50 of each dollar by which the Actual Operating Income exceeds the Operating Income Target (for each dollar of Actual Operating Income greater than 110% of the Operating Income Target).
|
|
o
|
One third of this pool is available for distribution to the Business Unit Participants, conditioned upon their individual MBO results.
|
|
o
|
The remaining two thirds of the pool is available for distribution to the Business Unit Participants, conditioned upon their individual MBO results, provided they achieve their business unit’s year-over-year “Growth Gate”. Funding based on the growth gate occurs on a linear trend line as per
Exhibit A
.
|
|
§
|
If Actual Operating Income is less than 90% of the Operating Income Target, the Business Unit/Individual Performance Pool for such business unit shall not be funded.
|
|
§
|
The “Growth Gate” requires that a business unit achieve a minimum level of year-over-year (“YOY”) growth in Actual Operating Income, which shall be approved during the budgeting process. At no time for purposes of the incentive plan calculation will the Growth Gate be set at less than 5% YOY Business Unit Operating Income growth.
|
|
§
|
The applicable business unit for a Participant shall be recommended by the business unit executive and approved by the Plan Committee.
|
|
17988 Edison Avenue
Chesterfield, MO 63005
|
Tel: (636) 530-8000
Fax: (636) 530-8010
www.insitufor
m
.
com
|
/s/
J. Joseph Burgess
|
|
|||
President and CEO
|
|
/s/ Brian J. Clarke
|
December 22, 2010
|
|||
Brian J. Clarke
|
Date
|
Company Name | Place of Incorporation |
Bayou Coating, L.L.C.
1
Bayou Perma-Pipe Canada, Ltd.
2
Bayou Wasco Insulation, LLC
3
Bayou Welding Works, L.L.C.
Commercial Coating Services International, LLC
Corrpower International Limited
4
Corrpro Canada Holdings, Inc.
Corrpro Canada, Inc.
Corrpro Companies Europe Ltd.
Corrpro Companies, Inc.
Corrpro Companies International, Inc.
Corrpro Holdings LLC
CRTS, Inc.
Delta Double Jointing, LLC
5
Energy & Mining Holding Company, LLC
Fibrwrap Construction Chile S.A.
6
Fibrwrap Construction Colombia S.A.S.
7
Fibrwrap Construction Latin America S.A.
Fibrwrap Construction Peru S.A.C.
8
Fibrwrap Construction Services, Inc.
Fibrwrap Construction Services Ltd.
Fibrwrap Construction Services USA, Inc.
Fyfe Co. LLC
Fyfe International Holdings B.V.
Fyfe – Latin America S.A.
Fyfe – Latin America S.A. de C.V.
Grupo Meltzer Fibrwrap Costa Rica S.A.
9
Hockway Middle East FZE
INA Acquisition Corp.
Infrastructure Group Holdings, LLC
Insitu Envirotech (S.E. Asia) Pte. Ltd.
Insituform Asia Limited
Insituform Belgium N.V.
Insituform CV
Insituform Cyprus Limited
Insituform Environmental Techniques Ltd.
10
Insituform Europe SAS
Insituform Holdings BV
Insituform Holdings (UK) Limited
Insituform Hong Kong Limited
Insituform-Hulin Rohrsanierungstechniken S.R.O.
11
Insituform Hulin Kft.
12
Insituform Limited Partnership
Insituform Linings Asia Sdn Bhd
Insituform Linings Limited
Insituform Pacific Pty Limited
Insituform Pipeline Rehabilitation Private Limited
13
Insituform Rioolrenovatietechnieken B.V.
Insituform Rohrsanierungstechniken GmbH
14
|
Louisiana
Alberta, Canada
Delaware
Louisiana
Texas
Saudi Arabia
Delaware
Alberta, Canada
United Kingdom
Ohio
Nevada
Delaware
Oklahoma
Delaware
Delaware
Republic of Chile
Republic of Columbia
Republic of Panama
Republic of Peru
Delaware
British Columbia, Canada
Delaware
Delaware
The Netherlands
Republic of Panama
Republic of El Salvador
Republic of Costa Rica
United Arab Emirates
Delaware
Delaware
Singapore
Hong Kong
Belgium
The Netherlands
Cyprus
Northern Ireland
France
The Netherlands
United Kingdom
Hong Kong
Slovakia
Hungary
New Brunswick, Canada
Malaysia
United Kingdom
Australia
India
The Netherlands
Germany
|
Insituform Singapore Pte. Ltd.
Insituform sp. z o.o.
Insituform SPML JV
15
Insituform Technologies CV
Insituform Technologies Ibérica S.A.
Insituform Technologies Limited
Insituform Technologies Limited
Insituform Technologies, LLC
Insituform Technologies Netherlands BV
Insituform Technologies USA, LLC
ITI International Services Canada Ltd.
ITI International Services, Inc.
KA-TE Insituform AG
Mississippi Textiles Corporation
Ocean City Research Corporation
Specialized Fabrics, LLC
The Bayou Companies, LLC
Trubice Technike s.r.o.
16
United Pipeline de Mexico S.A. de C.V.
17
United Pipeline Middle East, Inc.
United Pipeline Systems, Inc.
United Pipeline Systems International, Inc.
United Pipelines Inversiones Limitada
United Pipelines SRL
United Sistemas de Revestimento em Tubulações Ltda.
United Sistema de Tuberias Limitada
UPS-Aptec Limited
18
Video Injection – Insituform SAS
WCU Corrosion Technologies Pte. Ltd.
19
Wilson Walton Anti Corrosivos Ltd.
Wilson Walton Group Ltd.
|
Singapore
Poland
India
The Netherlands
Spain
Alberta, Canada
United Kingdom
Delaware
The Netherlands
Delaware
Alberta, Canada
Delaware
Switzerland
Mississippi
New Jersey
Washington
Delaware
Czech Republic
Mexico
Delaware
Nevada
Delaware
Chile
Argentina
Brazil
Chile
United Kingdom
France
Singapore
Portugal
United Kingdom
|
1 |
The Bayou Companies, LLC holds a 49% interest in Bayou Coating L.L.C.
The Bayou Companies, LLC holds a 59% interest in Delta Double Jointing, LLC and Bayou Coating L.L.C. holds the other 41% interest.
|
2
|
Insituform Technologies Limited (Alberta, Canada) holds a 51% interest.
|
3 |
Energy & Mining Holding Company, LLC holds a 51% interest.
|
4 |
Corrpro Canada, Inc. holds a 70% interest.
|
5 |
See Note 1.
|
6 |
Fibrwrap Construction Latin America S.A. holds a 55% interest.
|
7 |
Fibrwrap Construction Latin America S.A. holds a 51% interest.
|
8 | Fibrwrap Construction Latin America S.A. holds a 51% interest. |
9 | Fibrwrap Construction Latin America S.A. holds a 51% interest. |
10 |
Insituform Technologies Limited (UK) holds a 50% interest.
|
11 |
Insituform Technologies Limited (UK) holds a 50% interest in Insituform Rohrsanierungstechniken GmbH. Insituform Rohrsanierungstechniken GmbH holds a 51% interest in Instuform-Hulin Rohrsanierungstechniken S.R.O. (Slovakia). Insituform-Hulin Rohrsanierungstechniken S.R.O. holds a 100% interest in Insituform Hulin Kft. (Hungary) and Trubice Technike s.r.o (f/k/a Insituform s.r.o.) (Czech Republic).
|
12 | See Note 11. |
13 |
Insituform Technologies Netherlands BV holds a 50.5% interest.
|
14 | See Note 11. |
15 |
Insituform Technologies, LLC holds a 50% interest.
|
16 | See Note 11. |
17 |
INA Acquisition Corp. holds a 55% interest.
|
18 |
United Pipeline Systems International, Inc. holds a 51 interest.
|
19 |
Insituform Technologies Netherlands BV holds a 49% interest.
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1.
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I have reviewed this Annual Report on Form 10-K of Aegion Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: February 28, 2012. | |||
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/s/ J. Joseph Burgess | |
J. Joseph Burgess | |||
President and Chief Executive Officer | |||
(Principal Executive Officer) |
1.
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I have reviewed this Annual Report on Form 10-K of Aegion Corporation
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: February 28, 2012. | |||
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/s/ David A. Martin | |
Senior Vice President and Chief Financial Officer | |||
(Principal Financial Officer) |
(1)
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the Form 10-K fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date: February 28, 2012. | |||
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/s/ J. Joseph Burgess | |
J. Joseph Burgess | |||
President and Chief Executive Officer | |||
(Principal Executive Officer) |
(1)
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the Form 10-K fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date: February 28, 2012. | |||
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/s/ David A. Martin
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David A. Martin
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|||
Senior Vice President and Chief Financial Officer
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|||
(Principal Financial Officer) |