2024 Q1 Form 10-K Financial Statement

#000007375624000008 Filed on February 23, 2024

View on sec.gov

Income Statement

Concept 2024 Q1 2023 Q4 2023
Revenue $599.1M $654.6M $2.425B
YoY Change 11.57% 22.08% 17.36%
Cost Of Revenue $506.7M $549.0M $2.026B
YoY Change 10.29% 23.06% 15.18%
Gross Profit $92.38M $105.6M $399.0M
YoY Change 19.11% 17.23% 29.8%
Gross Profit Margin 15.42% 16.14% 16.45%
Selling, General & Admin $55.69M $58.18M $217.6M
YoY Change 9.6% 21.4% 10.75%
% of Gross Profit 60.28% 55.08% 54.55%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $27.06M $25.50M $99.00M
YoY Change -2.74% -8.42% -12.39%
% of Gross Profit 29.29% 24.14% 24.81%
Operating Expenses $55.69M $58.18M $217.6M
YoY Change 9.6% 21.4% 10.75%
Operating Profit $36.69M $47.45M $181.3M
YoY Change 37.17% 12.5% 63.56%
Interest Expense -$3.795M -$2.195M $36.52M
YoY Change -140.88% -66.5% -4.43%
% of Operating Profit -10.34% -4.63% 20.14%
Other Income/Expense, Net -$720.0K $1.364M $164.0K
YoY Change -1023.08% -364.34% -118.0%
Pretax Income $32.18M $46.62M -$62.29M
YoY Change 42.07% 32.79% 23.61%
Income Tax $17.04M $2.090M $63.65M
% Of Pretax Income 52.96% 4.48%
Net Earnings $15.14M $44.53M $97.40M
YoY Change 272.78% 92.53% 275.48%
Net Earnings / Revenue 2.53% 6.8% 4.02%
Basic Earnings Per Share $0.15 $0.97
Diluted Earnings Per Share $0.15 $0.44 $0.95
COMMON SHARES
Basic Shares Outstanding 100.8M shares 100.7M shares 100.7M shares
Diluted Shares Outstanding 102.3M shares 102.2M shares

Balance Sheet

Concept 2024 Q1 2023 Q4 2023
SHORT-TERM ASSETS
Cash & Short-Term Investments $354.7M $461.6M $461.6M
YoY Change -30.63% -19.74% -19.74%
Cash & Equivalents $354.7M $461.6M $461.6M
Short-Term Investments $0.00 $0.00
Other Short-Term Assets $88.53M $68.46M $68.46M
YoY Change 18.96% 9.47% 21.89%
Inventory $216.9M $209.8M $209.8M
Prepaid Expenses $68.46M
Receivables $577.4M $331.3M $565.8M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $1.237B $1.306B $1.306B
YoY Change -5.19% 0.66% 0.66%
LONG-TERM ASSETS
Property, Plant & Equipment $821.0M $424.3M $761.8M
YoY Change 92.11% -3.23% 31.79%
Goodwill $33.99M $34.21M
YoY Change -0.34% -0.36%
Intangibles $21.18M
YoY Change 83.92%
Long-Term Investments $30.46M $30.46M
YoY Change 1.35% 1.35%
Other Assets $136.4M $137.3M $85.65M
YoY Change 11.59% 12.32% 41.6%
Total Long-Term Assets $991.4M $933.3M $933.3M
YoY Change 34.48% 27.05% 27.05%
TOTAL ASSETS
Total Short-Term Assets $1.237B $1.306B $1.306B
Total Long-Term Assets $991.4M $933.3M $933.3M
Total Assets $2.229B $2.239B $2.239B
YoY Change 9.13% 10.2% 10.2%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $152.6M $156.1M $156.1M
YoY Change 6.91% 5.44% 5.44%
Accrued Expenses $347.4M $411.8M $355.8M
YoY Change 12.15% 33.94% 35.55%
Deferred Revenue $150.2M $164.6M
YoY Change 22.37% 45.76%
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $703.4M $732.5M $732.5M
YoY Change 22.28% 28.86% 28.86%
LONG-TERM LIABILITIES
Long-Term Debt $478.2M $477.1M $477.1M
YoY Change -31.76% -31.94% -31.94%
Other Long-Term Liabilities $418.2M $101.9M $394.4M
YoY Change 438.5% 20.39% 68.34%
Total Long-Term Liabilities $896.4M $579.0M $871.4M
YoY Change 15.16% -26.3% -6.82%
TOTAL LIABILITIES
Total Short-Term Liabilities $703.4M $732.5M $732.5M
Total Long-Term Liabilities $896.4M $579.0M $871.4M
Total Liabilities $1.606B $1.311B $1.611B
YoY Change 18.63% -3.15% 6.55%
SHAREHOLDERS EQUITY
Retained Earnings $1.440B $1.425B
YoY Change 8.14% 7.34%
Common Stock $122.0M $159.5M
YoY Change -20.13% -13.12%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $623.1M $628.0M $628.0M
YoY Change
Total Liabilities & Shareholders Equity $2.229B $2.239B $2.239B
YoY Change 9.13% 10.2% 10.2%

Cashflow Statement

Concept 2024 Q1 2023 Q4 2023
OPERATING ACTIVITIES
Net Income $15.14M $44.53M $97.40M
YoY Change 272.78% 92.53% 275.48%
Depreciation, Depletion And Amortization $27.06M $25.50M $99.00M
YoY Change -2.74% -8.42% -12.39%
Cash From Operating Activities -$69.72M $152.8M $210.0M
YoY Change 62.44% -4.17% 73.68%
INVESTING ACTIVITIES
Capital Expenditures $25.52M $34.05M $100.7M
YoY Change 39.38% 31.2% 24.29%
Acquisitions
YoY Change
Other Investing Activities $2.313M $4.265M $2.223M
YoY Change -271.84% 1874.54% -25.9%
Cash From Investing Activities -$23.21M -$29.78M -$86.35M
YoY Change 47.9% 15.73% 12.34%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -7.456M -222.2M -$227.3M
YoY Change 51.05% 12107.14%
NET CHANGE
Cash From Operating Activities -69.72M 152.8M $210.0M
Cash From Investing Activities -23.21M -29.78M -$86.35M
Cash From Financing Activities -7.456M -222.2M -$227.3M
Net Change In Cash -100.4M -99.13M -$107.2M
YoY Change 57.41% -174.12% -449.9%
FREE CASH FLOW
Cash From Operating Activities -$69.72M $152.8M $210.0M
Capital Expenditures $25.52M $34.05M $100.7M
Free Cash Flow -$95.24M $118.8M $109.2M
YoY Change 55.54% -11.05% 174.17%

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<div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Use of Estimates.</span><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%"> </span><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires that our management make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates.</span></div>
CY2023 us-gaap Prior Period Reclassification Adjustment Description
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<div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Reclassifications.</span><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%"> Certain amounts from prior periods have been reclassified to conform with the current year presentation.</span></div>
CY2023 oii Historical Credit Loss Analysis Period
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0.19
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LossContingencyDisclosures
COMMITMENTS AND CONTINGENCIES<div style="margin-top:5pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Lease Commitments</span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">As of December 31, 2023, we occupied several facilities under noncancellable operating leases expiring at various dates through 2038. See Note 4</span><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:400;line-height:120%">—“</span><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Leases” for more information on our operating leases.</span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Insurance</span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The workers' compensation, maritime employer's liability and comprehensive general liability insurance policies that we purchase each include a deductible layer, for which we would be responsible, that we consider financially prudent. Insurance above the deductible layers can be by occurrence or in the aggregate. We determine the level of accruals for claims exposure by reviewing our historical experience and current year claim activity. We do not record accruals on a present-value basis. We review larger claims with insurance adjusters and establish specific reserves for known liabilities. We establish an additional reserve for incidents incurred but not reported to us for each year using our estimates and based on prior experience. We believe we have established adequate accruals for </span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">expected liabilities arising from those obligations. However, it is possible that future earnings could be affected by changes in our estimates relating to these matters.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Litigation</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In the ordinary course of business, we are, from time to time, involved in litigation or subject to disputes, governmental investigations or claims related to our business activities, including, among other things:</span></div><div style="margin-top:9pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">•</span><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%;padding-left:14.5pt">performance- or warranty-related matters under our customer and supplier contracts and other business arrangements; and </span></div><div style="margin-top:9pt;padding-left:36pt;text-align:justify;text-indent:-18pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">•</span><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%;padding-left:14.5pt">workers’ compensation claims, Jones Act claims, occupational hazard claims, premises liability claims and other claims. </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Although we cannot predict the ultimate outcome of these matters, we believe that our ultimate liability, if any, that may result from these other actions and claims will not have a material adverse effect on our consolidated financial condition, results of operations or cash flows. However, because of the inherent uncertainty of litigation and other dispute resolution proceedings and, in some cases, the availability and amount of potentially available insurance, we can provide no assurance that the resolution of any particular claim or proceeding to which we are a party will not have a material effect on our consolidated financial condition, results of operations or cash flows for the fiscal period in which that resolution occurs.</span></div><div style="margin-top:9pt;text-align:justify"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Letters of Credit</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We had $62 million and $52 million in letters of credit outstanding as of December 31, 2023 and 2022, respectively, which related to self-insurance requirements and various bid and performance bonds, which are usually for the duration of the applicable contract.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Financial Instruments and Risk Concentration</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In the normal course of business, we manage risks associated with foreign exchange rates and interest rates through a variety of strategies, including the use of hedging transactions. As a matter of policy, we do not use derivative instruments unless we have an underlying exposure. Other financial instruments that potentially subject us to concentrations of credit risk are principally cash and cash equivalents and accounts receivable.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The carrying values of cash and cash equivalents approximate their fair values due to the short-term maturity of the underlying instruments. Accounts receivable are generated from a broad group of customers, primarily from the energy industry and the U.S. Government, which are major sources of our revenue. Due to their short-term nature, carrying values of our accounts receivable and accounts payable approximate fair market values. </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We estimated the aggregate fair market value of the 2028 Senior Notes to be $484 million as of December 31, 2023 based on quoted prices. Since the market for the 2028 Senior Notes is not an active market, the fair value of the Senior Notes is classified within Level 2 in the fair value hierarchy under U.S. GAAP (inputs other than quoted prices in active markets for similar assets and liabilities that are observable or can be corroborated by observable market data for substantially the full terms for the assets or liabilities).</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Foreign currency gains (losses) of $(1.4) million in the year ended December 31, 2023, were primarily related to gains (losses) for the Angolan kwanza of $(4.4) million due to declining exchange rates for the Angolan kwanza relative to the U.S. dollar. Foreign currency gains (losses) in the year ended December 31, 2022 were less than $(0.1) million. Foreign currency gains (losses) of $(8.4) million in the year ended December 31, 2021 were primarily related to gains (losses) for the Angolan kwanza of $(4.5) million due to declining exchange rates for the Angolan kwanza relative to the U.S. dollar. Foreign currency transaction losses related to the Angolan kwanza in the years ended December 31, 2023 and 2021 were primarily due to the remeasurement of our Angolan kwanza cash balances to U.S. dollars. We recorded foreign currency transaction gains (losses) related to the Angolan kwanza as a component of other income (expense), net in our Consolidated Statements of Operations in those respective periods. </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Any conversion of cash balances from kwanza to U.S. dollars is controlled by the central bank in Angola. As of December 31, 2023 and 2022, we had the U.S. dollar equivalent of approximately $8.1 million and $5.6 million of kwanza cash balances, respectively, in Angola reflected on our Consolidated Balance Sheets.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">To mitigate our currency exposure risk in Angola, we used kwanza to purchase equivalent Angolan central bank (Banco Nacional de Angola) bonds. The bonds were denominated as U.S. dollar equivalents, so that, upon payment of semi-annual interest and principal upon maturity, payment was made in kwanza, equivalent to the respective U.S. dollars at the then-current exchange rate. Our remaining Angolan bonds matured on September 1, 2023, and we received cash proceeds of $6.2 million. As of December 31, 2023, we no longer have any Angolan bank bonds.</span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">As of December 31, 2022, we had $6.2 million of U.S. dollar equivalent Angolan bonds. These bonds were classified as available-for-sale securities; accordingly, they were recorded at fair market value in other current assets on our Consolidated Balance Sheets. We did not sell any of our remaining Angolan bonds in the year ended December 31, 2022. We estimated the fair market value of the Angolan bonds to be $6.4 million as of December 31, 2022, using quoted market prices. Since the market for the Angolan bonds was not an active market, the fair value of the Angolan bonds was classified within Level 2 in the fair value hierarchy under U.S. GAAP. As of December 31, 2022, we had $0.1 million, in unrealized gains, net of tax, related to these bonds as a component of accumulated other comprehensive loss in our Consolidated Balance Sheets. </span></div><div style="margin-top:9pt"><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We made the decision during the fourth quarter of 2021 to terminate a number of entertainment ride systems contracts with Evergrande and recorded a net loss in our Manufactured Products segment. The specific elements of the net loss included a reserve of $49 million in receivables and contract assets, partially offset by the reclassification of $20 million of contract assets into salable inventory. As of December 31, 2023, 2022 and 2021 we had no outstanding accounts receivable or contract assets for those projects.</span></div><span style="color:#000000;font-family:'Arial',sans-serif;font-size:10pt;font-weight:400;line-height:120%">In the three-month period ended June 30, 2021, we were notified by a customer in our Manufactured Products segment that it was suspending a contract that was substantially complete. Specific to this contract, we billed and received $41 million in the year ended December 31, 2023. As of December 31, 2023, we had outstanding contract assets of approximately $1.3 million for the contract and contract liabilities of $3.4 million prepaid for storage of components. As of December 31, 2022, we had outstanding contract assets of approximately $19 million for the contract and contract liabilities of $0.6 million prepaid for storage of components. We are in discussions with the customer concerning the timing of remaining payments. We continue to believe we will realize these contract assets at their book values, although we can provide no assurance as to the timing of receipt of the remaining payments.</span>
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