Quarterly report pursuant to Section 13 or 15(d)

Business Combinations (Tables)

v3.10.0.1
Business Combinations (Tables)
 6 Months Ended
Jun. 30, 2018
Business Combinations  
Schedule of revenue and net income since acquisition date included in the Condensed Consolidated Statements of Operations

Revenue and net income since the respective acquisition dates included in our Condensed Consolidated Statements of Operations were as follows, in thousands:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2018

 

Six Months Ended June 30, 2018

2018 Acquisitions

    

Net Sales

    

Net (Loss) Income

 

Net Sales

 

Net Income

ADO

 

$

6,008

 

$

(75)

 

$

11,303

 

$

23

Santa Rosa

 

 

1,718

 

 

217

 

 

2,888

 

 

340

USI

 

 

68,696

 

 

1,617

 

 

68,696

 

 

1,617

 

 

$

76,422

 

$

1,759

 

$

82,887

 

$

1,980

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2017

 

Six Months Ended June 30, 2017

2017 Acquisitions

    

Net Sales

    

Net Income

 

Net Sales

    

Net Income

Midwest

 

$

4,940

 

$

231

 

$

8,208

 

$

140

EcoFoam

 

 

6,848

 

 

134

 

 

9,237

 

 

225

Superior

 

 

2,866

 

 

337

 

 

2,866

 

 

337

Canyon

 

 

1,733

 

 

221

 

 

1,733

 

 

221

All others

 

 

2,745

 

 

355

 

 

2,941

 

 

377

 

 

$

19,132

 

$

1,278

 

$

24,985

 

$

1,300

 

Schedule of pro forma results

Our pro forma results are presented below, in thousands:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pro Forma for the Three Months Ended June 30,

 

Pro Forma for the Six Months Ended June 30,

 

    

2018

    

 

2017

    

2018

    

 

2017

Net sales

 

$

639,754

 

$

592,200

 

$

1,233,442

 

$

1,152,747

Net income

 

$

29,287

 

$

27,853

 

$

62,103

 

$

33,967

 

Schedule of additional expense included in the pro forma operating profit and net income

Our pro forma results are presented below, in thousands:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pro Forma for the Three Months Ended June 30,

 

Pro Forma for the Six Months Ended June 30,

 

    

2018

    

2017

    

2018

    

2017

Amortization of intangible assets

 

$

1,250

 

$

4,088

 

$

5,039

 

$

8,175

Income tax expense (using normalized 27% ETR for 2018 and 38% ETR for 2017)

 

$

789

 

$

2,692

 

$

3,167

 

$

7,489

 

Schedule of estimated fair values of the assets acquired and liabilities assumed, as well as the fair value of consideration transferred

The estimated fair values of the assets acquired and liabilities assumed for the 2018 acquisitions, as well as the fair value of consideration transferred, approximated the following as of June 30, 2018, in thousands:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2018 Acquisitions

 

 

Completed During the Six Months Ended June 30, 2018

 

    

ADO

    

Santa Rosa

    

USI

 

Total

Estimated fair values:

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

$

939

 

$

 —

 

$

14,817

 

$

15,756

Accounts receivable

 

 

3,271

 

 

1,433

 

 

62,302

 

 

67,006

Inventories

 

 

2,326

 

 

104

 

 

14,135

 

 

16,565

Prepaid and other assets

 

 

194

 

 

 7

 

 

3,929

 

 

4,130

Property and equipment

 

 

951

 

 

522

 

 

34,215

 

 

35,688

Intangible assets

 

 

14,090

 

 

1,850

 

 

165,900

 

 

181,840

Goodwill

 

 

2,746

 

 

2,764

 

 

280,188

 

 

285,698

Accounts payable

 

 

(908)

 

 

(1,099)

 

 

(17,927)

 

 

(19,934)

Accrued liabilities

 

 

(609)

 

 

 —

 

 

(34,686)

 

 

(35,295)

Deferred tax liability

 

 

 —

 

 

 —

 

 

(35,871)

 

 

(35,871)

Net assets acquired

 

$

23,000

 

$

5,581

 

$

487,002

 

$

515,583

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2018 Acquisitions

 

 

Completed During the Six Months Ended June 30, 2018

 

  

ADO

  

Santa Rosa

  

USI

 

Total

Fair value of consideration transferred:

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

$

22,172

 

$

5,581

 

$

487,002

 

$

514,755

Deferred consideration

 

 

 —

 

 

 —

 

 

 —

 

 

 —

Contingent consideration

 

 

828

 

 

 —

 

 

 —

 

 

828

Total consideration transferred

 

$

23,000

 

$

5,581

 

$

487,002

 

$

515,583

 

 

The estimated fair values of the assets acquired and liabilities assumed for the 2017 acquisitions, as well as the fair value of consideration transferred, approximated the following as of June 30, 2018, in thousands:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2017 Acquisitions

 

 

Completed During the Six Months Ended June 30, 2017

 

    

Midwest

    

EcoFoam

    

Superior

    

Canyon

    

All others

    

Total

Estimated fair values:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable

 

$

6,576

 

$

3,819

 

$

2,012

 

$

8,222

 

$

678

 

$

21,307

Inventories

 

 

75

 

 

1,119

 

 

321

 

 

575

 

 

141

 

 

2,231

Prepaid and other assets

 

 

 —

 

 

27

 

 

 1

 

 

29

 

 

 6

 

 

63

Property and equipment

 

 

655

 

 

1,544

 

 

361

 

 

460

 

 

357

 

 

3,377

Intangible assets

 

 

2,740

 

 

6,700

 

 

5,280

 

 

15,220

 

 

3,640

 

 

33,580

Goodwill

 

 

3,538

 

 

10,796

 

 

3,662

 

 

10,072

 

 

4,037

 

 

32,105

Accounts payable

 

 

(1,359)

 

 

(1,378)

 

 

(681)

 

 

(163)

 

 

(26)

 

 

(3,607)

Accrued liabilities

 

 

 —

 

 

(302)

 

 

(4)

 

 

 —

 

 

 —

 

 

(306)

Net assets acquired

 

$

12,225

 

$

22,325

 

$

10,952

 

$

34,415

 

$

8,833

 

$

88,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2017 Acquisitions

 

 

Completed During the Six Months Ended June 30, 2017

 

  

Midwest

  

EcoFoam

  

Superior

  

Canyon

  

All others

  

Total

Fair value of consideration transferred:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

$

12,225

 

$

20,822

 

$

10,952

 

$

31,915

 

$

8,833

 

$

84,747

Deferred consideration

 

 

 —

 

 

 —

 

 

 —

 

 

2,500

 

 

 —

 

 

2,500

Contingent consideration

 

 

 —

 

 

1,503

 

 

 —

 

 

 —

 

 

 —

 

 

1,503

Total consideration transferred

 

$

12,225

 

$

22,325

 

$

10,952

 

$

34,415

 

$

8,833

 

$

88,750

 

Schedule of estimates of acquired intangible assets related to the acquisitions

Estimates of acquired intangible assets related to the acquisitions are as follows, as of June 30, 2018, dollars in thousands:

 

 

 

 

 

 

 

 

 

    

Estimated Fair Value

    

Weighted Average Estimated Useful Life (Years)

2018 Acquisitions:

 

 

 

 

 

 

Customer relationships

 

$

169,320

 

 

12

Trademarks and trade names

 

 

11,260

 

 

 9

Non-competition agreements

 

 

1,260

 

 

 5

Total intangible assets for 2018 acquisitions

 

$

181,840

 

 

11

 

 

 

 

 

 

 

2017 Acquisitions:

 

 

 

 

 

 

Customer relationships

 

$

26,170

 

 

10

Trademarks and trade names

 

 

1,780

 

 

10

Non-competition agreements

 

 

5,630

 

 

 5

Total intangible assets for 2017 acquisitions

 

$

33,580

 

 

 9

 

Schedule of fair value of contingent consideration

The following table presents the fair value of contingent consideration, in thousands:

 

 

 

 

 

 

 

 

 

    

EcoFoam

    

ADO

Date of Acquisition

 

February 27, 2017

 

February 10, 2018

Fair value of contingent consideration recognized at acquisition date

 

$

2,110

 

$

828

 

 

 

 

 

 

 

Contingent consideration at December 31, 2017

 

$

2,259

 

$

 —

Additions

 

 

 —

 

 

828

Change in fair value of contingent consideration during the six months ended June 30, 2018

 

 

85

 

 

38

Payment of contingent consideration during the six months ended June 30, 2018

 

 

(841)

 

 

 —

Liability balance for contingent consideration at June 30, 2018

 

$

1,503

 

$

866