ARC Document Solutions, Inc.
Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)
June 30, December 31,
Current assets: 2016 2015
------------ ------------
Cash and cash equivalents $ 20,452 $ 23,963
Accounts receivable, net of allowances for
accounts receivable of $1,850 and $2,094 60,933 60,085
Inventories, net 19,570 16,972
Prepaid expenses 4,766 4,555
Other current assets 4,347 4,131
------------ ------------
Total current assets 110,068 109,706
Property and equipment, net of accumulated
depreciation of $206,584 and $202,457 57,754 57,590
Goodwill 138,688 212,608
Other intangible assets, net 15,580 17,946
Deferred income taxes 76,019 74,196
Other assets 2,372 2,492
------------ ------------
Total assets $ 400,481 $ 474,538
============ ============
Current liabilities:
Accounts payable $ 22,148 $ 23,989
Accrued payroll and payroll-related expenses 11,811 12,118
Accrued expenses 18,023 19,194
Current portion of long-term debt and capital
leases 14,863 14,374
------------ ------------
Total current liabilities 66,845 69,675
Long-term debt and capital leases 150,059 157,018
Deferred income taxes 29,412 35,933
Other long-term liabilities 2,623 2,778
------------ ------------
Total liabilities 248,939 265,404
------------ ------------
Commitments and contingencies
Stockholders' equity:
ARC Document Solutions, Inc. stockholders'
equity:
Preferred stock, $0.001 par value, 25,000
shares authorized; 0 shares issued and
outstanding -- --
Common stock, $0.001 par value, 150,000 shares
authorized; 47,390 and 47,130 shares issued
and 46,008 and 47,029 shares outstanding 47 47
Additional paid-in capital 116,494 115,089
Retained earnings 36,357 89,687
Accumulated other comprehensive loss (2,653) (2,097)
------------ ------------
150,245 202,726
Less cost of common stock in treasury, 1,382
and 101 shares 5,709 612
------------ ------------
Total ARC Document Solutions, Inc.
stockholders' equity 144,536 202,114
Noncontrolling interest 7,006 7,020
------------ ------------
Total equity 151,542 209,134
------------ ------------
Total liabilities and equity $ 400,481 $ 474,538
============ ============
ARC Document Solutions, Inc.
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ --------------------
2016 2015 2016 2015
-------- -------- --------- ---------
Service sales $ 92,581 $ 99,336 $ 183,216 $ 192,661
Equipment and supplies sales 11,189 14,053 24,104 25,047
-------- -------- --------- ---------
Total net sales 103,770 113,389 207,320 217,708
Cost of sales 67,378 72,530 137,191 140,828
-------- -------- --------- ---------
Gross profit 36,392 40,859 70,129 76,880
Selling, general and
administrative expenses 25,503 27,132 51,859 54,587
Amortization of intangible assets 1,232 1,442 2,545 2,931
Goodwill impairment 73,920 -- 73,920 --
Restructuring expense 5 11 7 85
-------- -------- --------- ---------
(Loss) income from operations (64,268) 12,274 (58,202) 19,277
Other income, net (15) (30) (38) (56)
Loss on extinguishment of debt 44 97 90 97
Interest expense, net 1,526 1,939 2,972 3,796
-------- -------- --------- ---------
(Loss) income before income tax
(benefit) provision (65,823) 10,268 (61,226) 15,440
Income tax (benefit) provision (10,015) 811 (8,046) 1,572
-------- -------- --------- ---------
Net (loss) income (55,808) 9,457 (53,180) 13,868
Income attributable to the
noncontrolling interest (96) (200) (150) (175)
-------- -------- --------- ---------
Net (loss) income attributable
to ARC Document Solutions, Inc.
shareholders $(55,904) $ 9,257 $ (53,330) $ 13,693
======== ======== ========= =========
(Loss) earnings per share
attributable to ARC Document
Solutions, Inc. shareholders:
Basic $ (1.22) $ 0.20 $ (1.15) $ 0.29
======== ======== ========= =========
Diluted $ (1.22) $ 0.19 $ (1.15) $ 0.29
======== ======== ========= =========
Weighted average common shares
outstanding:
Basic 45,955 46,611 46,285 46,528
Diluted 45,955 47,558 46,285 47,634
ARC Document Solutions, Inc.
Non-GAAP Measures
Reconciliation of cash flows provided by operating activities to EBITDA and
Adjusted EBITDA
(In thousands)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
2016 2015 2016 2015
-------- -------- -------- --------
Cash flows provided by operating
activities $ 16,580 $ 16,864 $ 21,883 $ 22,152
Changes in operating assets and
liabilities, net of effect of
business acquisitions 209 2,928 8,018 12,344
Non-cash expenses, including
depreciation, amortization and
goodwill impairment (72,597) (10,335) (83,081) (20,628)
Income tax (benefit) provision (10,015) 811 (8,046) 1,572
Interest expense, net 1,526 1,939 2,972 3,796
Income attributable to the
noncontrolling interest (96) (200) (150) (175)
Depreciation and amortization 7,890 8,520 15,880 17,075
-------- -------- -------- --------
EBITDA (56,503) 20,527 (42,524) 36,136
Loss on extinguishment of debt 44 97 90 97
Goodwill impairment 73,920 -- 73,920 --
Trade secret litigation costs(1) -- -- -- 34
Restructuring expense(2) 5 11 7 85
Stock-based compensation 651 921 1,423 2,004
-------- -------- -------- --------
Adjusted EBITDA $ 18,117 $ 21,556 $ 32,916 $ 38,356
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ARC Document Solutions Reports Results for Second Quarter 2016
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