sxcl_10q-093012.htm
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________
FORM 10-Q
(Mark One)
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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended September 30, 2012 or
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Commission file number 0-15071
___________
Steel Excel Inc.
(Exact name of Registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
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94-2748530
(I.R.S. Employer Identification No.)
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2603 CAMINO RAMON, SUITE 200, SAN RAMON, CALIFORNIA
(Address of principal executive offices)
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94583
(Zip Code)
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Registrant's telephone number, including area code (408) 945-8600
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___________
Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). Yes x No ¨
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one).
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Large accelerated filer o |
Accelerated filer x |
Non-accelerated filer o |
Smaller reporting company o |
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(Do not check if a smaller reporting company) |
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Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No x
The number of shares of Steel Excel's common stock outstanding was 13,017,330 as of November 8. 2012.
TABLE OF CONTENTS
Part I.
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Financial Statements
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Item 1.
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Unaudited Consolidated Financial Statements
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Condensed Statements of Income for the three-month and nine-month periods ended September 30, 2012 and 2011
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3
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Condensed Statements of Comprehensive Income for the three-month and nine-month periods ended September 30, 2012 and 2011
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4
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Condensed Balance Sheets as of September 30, 2012 and December 31, 2011
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5
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Condensed Statements of Cash Flows for the nine-month periods ended September 30, 2012 and 2011
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6
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Notes to Condensed Financial Statements
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7
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Item 2.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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25
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Item 3.
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Quantitative and Qualitative Disclosures about Market Risk
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31
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Item 4.
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Controls and Procedures
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31
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Part II.
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Other Information
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Item 1.
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Legal Proceedings
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31
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Item 1A.
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Risk Factors
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31
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Item 6.
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Exhibits
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32
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Signatures
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33
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Steel Excel Inc.
CONDENSED STATEMENTS OF INCOME
(unaudited)
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Three-month Period Ended:
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Nine-month Period Ended:
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September 30,
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September 30,
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2012
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2011
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2012
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2011
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(in thousands, except per share amounts)
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Net revenues
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$ |
34,294 |
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$ |
707 |
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$ |
73,189 |
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$ |
707 |
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Cost of revenues
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22,084 |
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176 |
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45,817 |
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176 |
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Gross margin
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12,210 |
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531 |
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27,372 |
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531 |
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Operating expenses:
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Selling, general and administrative
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8,460 |
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2,048 |
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21,007 |
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7,414 |
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Amortization of acquisition-related intangible asset
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- |
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8 |
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- |
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8 |
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Restructuring charges
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- |
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- |
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- |
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38 |
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Total operating expenses
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8,460 |
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2,056 |
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21,007 |
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7,460 |
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Income (loss) from continuing operations
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3,750 |
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(1,525 |
) |
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6,365 |
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(6,929 |
) |
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Interest and other income (expense), net
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469 |
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(18 |
) |
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432 |
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8,109 |
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Income (loss) from continuing operations before income taxes
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4,219 |
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(1,543 |
) |
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6,797 |
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1,180 |
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Benefit from income taxes
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1,105 |
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2,793 |
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312 |
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337 |
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Income from continuing operations, net of taxes
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5,324 |
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1,250 |
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7,109 |
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1,517 |
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Income (loss) from discontinued operations, net of taxes
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25 |
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- |
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(1,986 |
) |
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1,910 |
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Gain on disposal of discontinued operations, net of taxes
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- |
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85 |
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- |
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5,005 |
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Income (loss) from discontinued operations, net of taxes
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25 |
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85 |
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(1,986 |
) |
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6,915 |
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Net income
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5,349 |
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1,335 |
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5,123 |
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8,432 |
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Net loss attributable to non-controlling interest
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$ |
- |
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$ |
- |
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$ |
(580 |
) |
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$ |
- |
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Net income attributable to Steel Excel Inc.
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$ |
5,349 |
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$ |
1,335 |
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$ |
5,703 |
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$ |
8,432 |
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Income (loss) per share:
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Basic
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Income from continuing operations, net of taxes
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$ |
0.41 |
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$ |
0.11 |
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$ |
0.60 |
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$ |
0.14 |
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Income (loss) from discontinued operations, net of taxes
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$ |
0.00 |
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$ |
0.01 |
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$ |
(0.17 |
) |
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$ |
0.64 |
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Net income attributable to Steel Excel Inc.
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$ |
0.41 |
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$ |
0.12 |
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$ |
0.48 |
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$ |
0.77 |
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Diluted
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Income from continuing operations, net of taxes
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$ |
0.41 |
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$ |
0.11 |
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$ |
0.60 |
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$ |
0.14 |
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Income (loss) from discontinued operations, net of taxes
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$ |
0.00 |
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$ |
0.01 |
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$ |
(0.17 |
) |
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$ |
0.63 |
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Net income attributable to Steel Excel Inc.
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$ |
0.41 |
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$ |
0.12 |
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$ |
0.48 |
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$ |
0.77 |
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Shares used to compute income (loss) per share:
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Basic
|
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12,982 |
|
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|
10,881 |
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11,820 |
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10,881 |
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Diluted
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13,001 |
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10,905 |
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11,840 |
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10,898 |
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See accompanying Notes to Condensed Financial Statements.
Steel Excel Inc.
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
|
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Three-month Period Ended:
|
|
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Nine-month Period Ended:
|
|
|
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September 30,
|
|
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September 30,
|
|
|
|
2012
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2011
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2012
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2011
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(in thousands)
|
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Net income attributable to Steel Excel Inc.
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|
$ |
5,349 |
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|
$ |
1,335 |
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$ |
5,703 |
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$ |
8,432 |
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Other comprehensive income (loss), net of taxes
|
|
|
|
|
|
|
|
|
|
|
|
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Net foreign currency translation adjustment, net of taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Foreign currency translation adjustment, net of taxes
|
|
|
(62 |
) |
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|
- |
|
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|
(70 |
) |
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|
159 |
|
Release of foreign currency translation gains, net of taxes
|
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|
- |
|
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|
- |
|
|
|
- |
|
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(2,542 |
) |
Subtotal
|
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(62 |
) |
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|
- |
|
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(70 |
) |
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(2,383 |
) |
Net unrealized gain on marketable securities, net of taxes
|
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|
942 |
|
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|
- |
|
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|
560 |
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|
76 |
|
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|
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|
|
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|
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Comprehensive income
|
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|
6,229 |
|
|
|
1,335 |
|
|
|
6,193 |
|
|
|
6,125 |
|
Comprehensive loss attributable to non-controlling interest
|
|
|
- |
|
|
|
- |
|
|
|
(580 |
) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Comprehensive income attributable to Steel Excel Inc.
|
|
$ |
6,229 |
|
|
$ |
1,335 |
|
|
$ |
6,773 |
|
|
$ |
6,125 |
|
See accompanying Notes to Condensed Financial Statements.
Steel Excel Inc.
CONDENSED BALANCE SHEETS
(unaudited)
|
|
September 30, 2012
|
|
|
December 31, 2011
|
|
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(in thousands)
|
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|
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Assets
|
|
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|
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Current assets:
|
|
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Cash and cash equivalents
|
|
$ |
64,942 |
|
|
$ |
8,487 |
|
Marketable securities
|
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|
192,878 |
|
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|
314,941 |
|
Accounts receivable, net of allowance of $0 and $80, respectively
|
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|
33,320 |
|
|
|
4,660 |
|
Prepaid expenses and other current assets
|
|
|
4,130 |
|
|
|
2,055 |
|
Total current assets
|
|
|
295,270 |
|
|
|
330,143 |
|
Property and equipment, net
|
|
|
76,922 |
|
|
|
21,060 |
|
Goodwill
|
|
|
43,575 |
|
|
|
8,244 |
|
Intangible assets, net
|
|
|
42,436 |
|
|
|
5,786 |
|
Other long-term assets
|
|
|
4,115 |
|
|
|
3,444 |
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$ |
462,318 |
|
|
$ |
368,677 |
|
|
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Liabilities and Stockholders' Equity
|
|
|
|
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Current liabilities:
|
|
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|
|
|
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|
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Accounts payable
|
|
$ |
3,548 |
|
|
$ |
1,841 |
|
Accrued and other liabilities
|
|
|
8,982 |
|
|
|
3,826 |
|
Current portion of capital lease obligations
|
|
|
405 |
|
|
|
- |
|
Current portion of long-term debt
|
|
|
4,000 |
|
|
|
- |
|
3/4% convertible senior subordinated notes
|
|
|
346 |
|
|
|
346 |
|
Total current liabilities
|
|
|
17,281 |
|
|
|
6,013 |
|
Other long-term liabilities
|
|
|
8,864 |
|
|
|
10,737 |
|
Deferred income taxes
|
|
|
6,026 |
|
|
|
30 |
|
Capital lease obligations, net of current portion
|
|
|
1,096 |
|
|
|
- |
|
Long-term debt, net of current portion
|
|
|
10,000 |
|
|
|
- |
|
Total liabilities
|
|
|
43,267 |
|
|
|
16,780 |
|
|
|
|
|
|
|
|
|
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Commitments and contingencies (Note 10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Stockholders' equity:
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
13,017 |
|
|
|
10,892 |
|
Additional paid-in capital
|
|
|
220,307 |
|
|
|
160,755 |
|
Accumulated other comprehensive income
|
|
|
1,022 |
|
|
|
743 |
|
Retained earnings
|
|
|
184,782 |
|
|
|
179,079 |
|
Total Steel Excel stockholders' equity
|
|
|
419,128 |
|
|
|
351,469 |
|
Non-controlling interest
|
|
|
(77 |
) |
|
|
428 |
|
Total stockholders' equity
|
|
|
419,051 |
|
|
|
351,897 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders' equity
|
|
$ |
462,318 |
|
|
$ |
368,677 |
|
See accompanying Notes to Condensed Financial Statements.
Steel Excel Inc.
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
|
|
Nine-month Period Ended:
|
|
|
|
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
|
(in thousands)
|
|
Cash Flows from Operating Activities:
|
|
|
|
|
|
|
Net income
|
|
$ |
5,703 |
|
|
$ |
8,432 |
|
Less: Income from discontinued operations, net of taxes
|
|
|
1,986 |
|
|
|
(6,915 |
) |
Income from continuing operations, net of taxes
|
|
|
7,689 |
|
|
|
1,517 |
|
Adjustments to reconcile income from continuing operations, net of taxes to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
Net loss attributable to non-controlling interest
|
|
|
(580 |
) |
|
|
- |
|
Stock-based compensation expense
|
|
|
857 |
|
|
|
490 |
|
Depreciation and amortization
|
|
|
11,342 |
|
|
|
2,040 |
|
Deferred income taxes
|
|
|
(13 |
) |
|
|
1,365 |
|
Gain on release of foreign currency translation, net of taxes
|
|
|
- |
|
|
|
(2,542 |
) |
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed:
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
(21,532 |
) |
|
|
- |
|
Prepaid expenses and other current assets
|
|
|
(1,109 |
) |
|
|
2,088 |
|
Assets held for sale
|
|
|
- |
|
|
|
6,216 |
|
Other assets
|
|
|
(111 |
) |
|
|
(790 |
) |
Accounts payable
|
|
|
1,177 |
|
|
|
(131 |
) |
Accrueds and other liabilities
|
|
|
280 |
|
|
|
(5,196 |
) |
Net cash (used in) provided by operating activities of continuing operations
|
|
|
(2,000 |
) |
|
|
5,057 |
|
Net cash (used in) provided by operating activities of discontinued operations
|
|
|
(823 |
) |
|
|
6,933 |
|
Net cash (used in) provided by operating activities
|
|
|
(2,823 |
) |
|
|
11,990 |
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
Purchases of businesses, net of cash acquired
|
|
|
(52,492 |
) |
|
|
(7,530 |
) |
Purchases of property and equipment
|
|
|
(7,607 |
) |
|
|
- |
|
Investment by non-controlling interest
|
|
|
75 |
|
|
|
- |
|
Purchases of marketable securities
|
|
|
(498,964 |
) |
|
|
(491,499 |
) |
Sales of marketable securities
|
|
|
568,536 |
|
|
|
396,194 |
|
Maturities of marketable securities
|
|
|
51,804 |
|
|
|
62,321 |
|
Net cash provided by (used in) investing activities
|
|
|
61,352 |
|
|
|
(40,514 |
) |
|
|
|
|
|
|
|
|
|
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
Repayments on capital lease obligations
|
|
|
(126 |
) |
|
|
- |
|
Repayments on long-term debt
|
|
|
(2,000 |
) |
|
|
- |
|
Proceeds from issuance of common stock
|
|
|
- |
|
|
|
29 |
|
Net cash (used in) provided by financing activities
|
|
|
(2,126 |
) |
|
|
29 |
|
|
|
|
|
|
|
|
|
|
Effect of foreign currency translation on cash and cash equivalents
|
|
|
52 |
|
|
|
288 |
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
56,455 |
|
|
|
(28,207 |
) |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period
|
|
|
8,487 |
|
|
|
38,276 |
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$ |
64,942 |
|
|
$ |
10,069 |
|
See accompanying Notes to Condensed Financial Statements.
Steel Excel Inc.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
1. Description and Basis of Presentation
Description
Steel Excel Inc. (“Steel Excel” or the “Company”) is primarily focused on capital redeployment and identification of new business operations in which it can utilize its existing working capital and maximize the use of the Company’s net tax operating losses (“NOLs”) in the future. The identification of new business operations includes, but is not limited to, the oilfield services, sports, training, education, entertainment, and lifestyle businesses. During the fiscal year ended December 31, 2011, the Company acquired two sports-related businesses (Baseball Heaven and The Show) and one oilfield services business (Rogue Pressure Services). During the nine-month period ended September 30, 2012, it acquired two additional oilfield services businesses (Eagle Well Services and Sun Well Service). The Company currently operates in these two reportable segments, Steel Sports and Steel Energy, but may add other segments in the future depending upon acquisition opportunities to further redeploy its working capital.
Basis of Presentation
In the opinion of management, the accompanying Condensed, Consolidated Financial Statements (“Condensed Financial Statements”) of Steel Excel and its wholly-owned subsidiaries have been prepared on a consistent basis with the December 31, 2011 audited financial statements. The Condensed Financial Statements have been prepared in accordance with the regulations of the Securities and Exchange Commission (the “SEC”) and, therefore, omit certain information and footnote disclosures necessary to present the statements in accordance with accounting principles generally accepted in the United States of America and are considered unaudited and condensed. The December 31, 2011 Condensed Balance Sheet was derived from audited financial statements. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011, which was filed with the SEC on March 13, 2012.
The Company’s Condensed Financial Statements include the accounts of Steel Excel and its subsidiaries. All significant intercompany accounts have been eliminated in consolidation.
The Company is reporting its quarterly financial information using a calendar convention; that is, the first, second and third quarters will consistently be reported as ending on March 31, June 30 and September 30, respectively. It has been the practice to establish actual quarterly closing dates using a predetermined “fiscal” calendar, which requires closing the books on a Saturday in order to minimize the potentially disruptive effects of quarterly closing on business processes. The effects of this practice are generally not significant to reported results for any quarter and only exist within a reporting year. In the event that differences in actual closing dates are material to year-over-year comparisons of quarterly or year-to-date results, appropriate disclosures are provided. The actual closing dates for the three and nine months ended September 30, 2012 and 2011 were September 29, 2012 and September 30, 2011, respectively.
Reverse/Forward Stock Split
At the close of business on October 3, 2011, the Company effected a reverse split (the “Reverse Split”) immediately followed by a forward split (the “Forward Split” and together with the Reverse Split, the “Reverse/Forward Split”). At the Company’s 2011 annual stockholders meeting, its stockholders approved a proposal authorizing the Board of Directors (the “Board”) to effect the Reverse/Forward Split at exchange ratios determined by the Board within certain specified ranges.
The exchange ratio for the Reverse Split was 1-for-500 and the exchange ratio for the Forward Split was 50-for-1. As a result of the Reverse Split, stockholders holding less than 500 shares (the “Cashed Out Stockholders”) were entitled to a cash payment for all of their shares. All remaining stockholders following the Forward Split (the “Remaining Stockholders”) were also entitled to a cash payment for any fractional shares that they would otherwise have received. The cash payment that each Cashed Out Stockholder or Remaining Stockholder was entitled to receive was based upon such stockholder’s pro rata share of the total net proceeds received in the sale of the aggregated fractional shares by the Company’s transfer agent at prevailing prices on the open market.
All shares outstanding and per share information for the previous financial periods being reported have been adjusted to reflect the Reverse/Forward Split.
2. Summary of Significant Accounting Policies and Recent Accounting Pronouncements
The Company’s significant accounting policies have not changed from those presented in Note 1 to the Consolidated Financial Statements in the Annual Report on Form 10-K for the fiscal year ended December 31, 2011.
In July 2012, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2012-02, “Intangibles-Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment” which simplifies how entities test indefinite-lived intangible assets for impairment. The amendment to the Accounting Standards Codification (ASC) permits entities to first assess qualitative factors to determine whether it is more likely than not that the indefinite-lived intangible asset is impaired. If based on this assessment, the Company concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then performing the quantitative impairment test is unnecessary. The amendment is effective for annual and interim indefinite-lived intangible assets impairment tests performed for fiscal years beginning after September 15, 2012, with early adoption permitted. The Company is evaluating the impact of this ASU and does not expect its adoption to have a significant impact on the Company’s consolidated financial statements.
Effective January 1, 2012, the Company adopted the provisions of ASU No. 2011-05, Comprehensive Income (Topic 220) Presentation of Comprehensive Income, or ASU No. 2011-05, and began presenting the total of comprehensive income, the components of net income and the components of other comprehensive income in two separate but consecutive statements. The provisions of ASU No. 2011-05 are required to be adopted retroactively. As this guidance provides only presentation requirements, the adoption of this standard did not impact the Company’s results of operations, cash flows, or financial position.
In September 2011, the FASB issued ASU No. 2011-08, Intangibles – Goodwill and Other (Topic 350). ASU No. 2011-08 allows entities to first assess qualitatively whether it is necessary to perform the two-step goodwill impairment test. If an entity believes, as a result of its qualitative assessment, that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the quantitative two-step goodwill impairment test is required. An entity has the unconditional option to bypass the qualitative assessment and proceed directly to performing the first step of the goodwill impairment test. ASU No. 2011-08 was effective for the Company’s first quarter of 2012. The Company performs its annual goodwill impairment test during the fourth quarter. The Company does not believe adoption of this standard during the fourth quarter of 2012 will have an impact on its consolidated results of operations, financial condition, or cash flows.
There were no additional accounting pronouncements recently issued in the nine-month period ended September 30, 2012, which are applicable to the Company or may be considered material to the Company. For a complete discussion of the impact of recent accounting pronouncements, please refer to Note 2 of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011.
On February 9, 2012, the Company acquired the business and assets of Eagle Well Services, Inc., which after the transaction operated as Well Services Ltd. (“Well Services”) for an aggregate purchase price of $48.1 million in cash. Well Services engages in the business of workover rig well servicing, including down hole well maintenance and workover, down hole well repairs, well completions, well recompletions, well drill outs and clean outs, and well reentry. Well Services is included in the Company’s Steel Energy reporting segment.
The Company accounted for this acquisition as a business combination and the total cash consideration of $48.1 million has been allocated to the net assets acquired based on their respective estimated fair values at February 9, 2012 as follows:
|
|
Amount
|
|
|
|
(in thousands)
|
|
|
|
|
|
Property and equipment
|
|
$ |
23,842 |
|
Intangible assets
|
|
|
14,300 |
|
Accrued expenses
|
|
|
(137 |
) |
Total net identifiable assets
|
|
|
38,005 |
|
|
|
|
|
|
Goodwill
|
|
|
10,126 |
|
|
|
|
|
|
Net assets acquired
|
|
$ |
48,131 |
|
The intangible assets acquired consist of customer relationships, which are being amortized on an accelerated basis over the estimated useful life of ten years. The $10.1 million goodwill arises from the growth potential the Company sees for Well Services, along with expected synergies with the Company’s current Steel Energy businesses, and is expected to be deductible for tax purposes. The acquisition-related costs for the purchase of Well Services included in “Selling, general and administrative” expenses in the Condensed Statement of Income were $0.2 million for the nine-month period ended September 30, 2012.
On May 31, 2012, the Company completed its acquisition of SWH, Inc. (“SWH”), a subsidiary of BNS Holding, Inc. (“BNS”). SWH’s sole business is Sun Well Service, Inc. (“Sun Well”), which is a provider of premium well services to oil and gas exploration and production companies operating in the Williston Basin in North Dakota and Montana. Sun Well is included in the Company’s Steel Energy reporting segment.
Pursuant to the terms of the Share Purchase Agreement, the Company acquired all of the capital stock of SWH for an acquisition price aggregating $68.7 million. The aggregate acquisition price consisted of the issuance of 2,027,500 shares of the Company’s common stock (valued at $30 per share) and cash of $7.9 million. Affiliates of Steel Partners Holdings L.P. (“Steel Partners”) owned approximately 40% of the Company’s outstanding common stock and 85% of BNS prior to the execution of the Share Purchase Agreement.
As a result of the acquisition, Steel Partners beneficially owned approximately 51.1% of the Company’s outstanding common stock. Each of the Company and BNS appointed a special committee of independent directors to consider and negotiate the transaction because of the interest of Steel Partners in each company. Please see Note 17 for further details of this related party transaction.
The Company accounted for this acquisition as a business combination and the total acquisition price has been allocated to the net assets acquired based on their respective estimated fair values at May 31, 2012 as follows:
|
|
Amount
|
|
|
|
(in thousands)
|
|
|
|
|
|
Cash
|
|
$ |
3,561 |
|
Accounts receivable
|
|
|
7,233 |
|
Prepaid expense and other current assets
|
|
|
782 |
|
Property and equipment
|
|
|
29,787 |
|
Identifiable intangible assets
|
|
|
27,300 |
|
Other long-term assets
|
|
|
714 |
|
Accounts payable
|
|
|
(1,036 |
) |
Accrued expenses and other current liabilities
|
|
|
(3,464 |
) |
Long-term debt
|
|
|
(16,000 |
) |
Capital lease obligations
|
|
|
(1,622 |
) |
Deferred tax liabilities
|
|
|
(5,510 |
) |
Total net identifiable assets
|
|
|
41,745 |
|
|
|
|
|
|
Goodwill
|
|
|
27,001 |
|
|
|
|
|
|
Net assets acquired
|
|
$ |
68,746 |
|
The $27.3 million intangible assets acquired consist of customer relationships and a trade name, which will be amortized on an accelerated basis over their respective estimated useful lives of ten and five years, respectively. The $27.0 million goodwill arises from the growth potential the Company sees for Sun Well, along with expected synergies with the Company’s current Steel Energy businesses, and is expected to be non-deductible for tax purposes. The acquisition-related costs for the purchase of SWH included in “Selling, general and administrative” expenses in the Condensed Statements of Income were $1.2 million for nine-month period ended September 30, 2012.
Additionally, on May 31, 2012, the business of Well Services was combined with Sun Well and both businesses now operate as Sun Well.
The results of operations for Well Services and SWH are included in the accompanying financial statements since their respective acquisition dates.
Pro Forma Financial Information
The following pro forma financial information presents the combined results of the Company, Rogue Pressure Services, LLC (acquired December 7, 2011), Well Services and SWH, as if the acquisitions had occurred at the beginning of the fiscal year ended December 31, 2011. Such pro forma results are not necessarily indicative of what would have actually occurred had the acquisitions been in effect for the entire period. The pro forma financial information is presented for informational purposes only and does not purport to represent the results of future operations. The pro forma results are as follows:
|
|
Three-month Period Ended:
|
|
|
Nine-month Period Ended:
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
$ |
34,294 |
|
|
$ |
25,740 |
|
|
$ |
96,641 |
|
|
$ |
65,238 |
|
Net income attributable to Steel Excel Inc.
|
|
$ |
5,349 |
|
|
$ |
5,123 |
|
|
$ |
8,050 |
|
|
$ |
9,501 |
|
Basic net income per share
|
|
$ |
0.41 |
|
|
$ |
0.40 |
|
|
$ |
0.62 |
|
|
$ |
0.74 |
|
Diluted net income per share
|
|
$ |
0.41 |
|
|
$ |
0.40 |
|
|
$ |
0.62 |
|
|
$ |
0.74 |
|
Basic weighted average shares
|
|
|
12,982 |
|
|
|
12,908 |
|
|
|
12,942 |
|
|
|
12,908 |
|
Diluted weighted average shares
|
|
|
13,001 |
|
|
|
12,932 |
|
|
|
12,961 |
|
|
|
12,925 |
|
4. Discontinued Operations
Discontinued operations for the three months and nine months ended September 30, 2012 represent The Show. The Show was not meeting projections, with no expectation to perform as represented when acquired. The operating results and cash flows of these discontinued operations are included in the Company’s condensed financial statements up to the date of disposition, which was July 1, 2012. As The Show was acquired in mid-August 2011, there was immaterial activity in the three months and nine months ended September 30, 2011. The following table indicates the components of the discontinued operations of The Show in the three months and nine months ended September 30, 2012:
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
September 30, 2012
|
|
|
September 30, 2012
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
Revenues
|
|
$ |
- |
|
|
$ |
410 |
|
Goodwill impairment
|
|
$ |
- |
|
|
$ |
(1,796 |
) |
Impairment of other assets
|
|
$ |
- |
|
|
$ |
(185 |
) |
Income (loss) from operations, net of taxes
|
|
$ |
25 |
|
|
$ |
(5 |
) |
The Company sold its business of providing data storage and software solutions and products (the “DPS Business”) to PMC-Sierra on June 8, 2010. The purchase price for the DPS Business was $34.3 million, of which $29.3 million was received by the Company upon the closing of the transaction and the remaining $5.0 million was withheld in an escrow account (“DPS Holdback”). The DPS Holdback was released to the Company on June 8, 2011, one year after the consummation of the sale, except for $0.1 million to provide for one disputed claim, and was recognized as contingent consideration in discontinued operations when received. The $0.1 million was received in September 30, 2011. In addition, during the three months and nine months ended September 30, 2011, the Company sold patents from its DPS Business for $1.9 million, which was included in income from discontinued operations.
The Company grants stock options and other stock-based awards to employees, directors and consultants under two equity incentive plans, the 2004 Equity Incentive Plan and the 2006 Director Plan. As of September 30, 2012, the Company had an aggregate of 1.8 million shares of its common stock reserved for issuance under its 2004 Equity Incentive Plan, of which 104,500 shares were subject to outstanding options and other stock-based awards and 1.7 million shares were available for future grants of options and other stock-based awards. As of September 30, 2012, the Company had an aggregate of 0.4 million shares of its common stock reserved for issuance under its 2006 Director Plan, of which 64,924 shares were subject to outstanding options and other stock-based awards and 0.3 million shares were available for future grants of options and other stock-based awards.
Stock Benefit Plan Activities
Stock Options: A summary of option activity under all of the Company’s equity incentive plans as of September 30, 2012 and changes during the nine-month period then ended is as follows:
|
|
Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding at December 31, 2011
|
|
|
94 |
|
|
$ |
31.89 |
|
|
|
|
|
|
|
Granted
|
|
|
3 |
|
|
$ |
- |
|
|
|
|
|
|
|
Exercised
|
|
|
- |
|
|
$ |
- |
|
|
|
|
|
|
|
Forfeited
|
|
|
- |
|
|
$ |
- |
|
|
|
|
|
|
|
Expired
|
|
|
(32 |
) |
|
$ |
37.80 |
|
|
|
|
|
|
|
Outstanding at September 30, 2012
|
|
|
65 |
|
|
$ |
30.54 |
|
|
|
7.51 |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options vested and expected to vest at September 30, 2012
|
|
|
65 |
|
|
$ |
30.54 |
|
|
|
7.51 |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options exercisable at September 30, 2012
|
|
|
42 |
|
|
$ |
31.70 |
|
|
|
6.82 |
|
|
$ |
- |
|
The aggregate intrinsic value is calculated as the difference between the closing price of the Company’s common stock on the OTCQB Market and the exercise price of any underlying awards of shares subject to options that were in-the-money as of September 30, 2012. There were no options in-the-money as of September 30, 2012. As of September 30, 2012, the total unamortized stock-based compensation expense related to non-vested stock options, net of estimated forfeitures, was $0.2 million and this expense is expected to be recognized over a remaining weighted-average period of 1.6 years.
Restricted Stock: Restricted stock awards and restricted stock units (collectively, “restricted stock”) were granted under the Company’s 2004 Equity Incentive Plan and the 2006 Director Plan. As of September 30, 2012, there were 86,177 shares of service-based restricted stock awards and 18,250 shares of restricted stock units outstanding. The cost of restricted stock, determined to be the fair market value of the shares at the date of grant, is expensed ratably over the period the restrictions lapse or as specified in the grant agreements.
A summary of activity for restricted stock units as of September 30, 2012 and changes during the nine-month period then ended is as follows:
|
|
Shares
|
|
|
|
|
|
|
|
|
|
|
|
Non-vested restricted stock units at December 31, 20111
|
|
|
17 |
|
|
$ |
0.010 |
|
Awarded
|
|
|
14 |
|
|
$ |
0.001 |
|
Vested
|
|
|
(13 |
) |
|
$ |
0.010 |
|
Forfeited
|
|
|
- |
|
|
$ |
- |
|
Non-vested restricted stock units at September 30, 20121
|
|
|
18 |
|
|
$ |
0.010 |
|
|
(1)
|
Non-vested restricted stock units at each period included shares to certain non-employee directors in which vesting will occur immediately if the relationship between the Company and the non-employee director ceases for any reason, subject in the case of a voluntary resignation to the consent of the Compensation Committee to the immediate vesting. These non-vested shares were recognized and fully expensed as stock-based compensation in the Condensed Statements of Income at the date of grant or the date of modification.
|
All restricted stock units issued prior to December 31, 2011 were awarded at the par value of $0.001 per share (adjusted to $0.01 per share to reflect the Reverse/Forward Split). As of September 30, 2012, the total unamortized stock-based compensation expense related to non-vested restricted stock units that is expected to vest, net of estimated forfeitures, was immaterial.
Stock-Based Compensation
The Company measures and recognizes stock-based compensation expense for all stock-based awards made to its employees, directors and consultants based on estimated fair values using a straight-line amortization method over the respective requisite service period of the awards and adjusted it for estimated forfeitures. In addition, the Company applies the simplified method to establish the beginning balance of the additional paid-in capital pool related to the tax effects of employee stock-based compensation, which is available to absorb tax shortfall.
Stock-based compensation expenses included in the Condensed Statements of Income for the three-month and nine-month periods ended September 30, 2012 and September 30, 2011 were as follows:
|
|
Three-month Period Ended:
|
|
|
Nine-month Period Ended:
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
|
|
(in thousands)
|
|
|
(in thousands)
|
|
Stock-based compensation expense by caption:
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, marketing and administrative
|
|
$ |
421 |
|
|
$ |
30 |
|
|
$ |
857 |
|
|
$ |
490 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation expense by award type:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock options
|
|
$ |
26 |
|
|
$ |
26 |
|
|
$ |
68 |
|
|
$ |
43 |
|
Retricted stock
|
|
|
395 |
|
|
|
4 |
|
|
|
789 |
|
|
|
447 |
|
Total
|
|
$ |
421 |
|
|
$ |
30 |
|
|
$ |
857 |
|
|
$ |
490 |
|
The stock-based compensation expense in the above table does not reflect any significant tax expense, which is consistent with the Company’s treatment of income or loss from its United States operations. For the three-month and nine-month periods ended September 30, 2012 and September 30, 2011, there were no income tax benefits realized for the tax deductions from option exercises of the stock-based payment arrangements. In addition, there were no stock-based compensation costs capitalized as part of an asset in the three-month and nine-month periods ended September 30, 2012 and September 30, 2011.
Valuation Assumptions
The Company uses the Black-Scholes option pricing model for determining the estimated fair value for all stock-based awards. No grants were made in the three-month period ended September 30, 2011. The fair value applied to the stock-based awards granted in the three-month and nine-month periods ended September 30, 2012 and 2011 were estimated using the following weighted average assumptions:
|
|
Three-month Period Ended:
|
|
|
Nine-month Period Ended:
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expected life (in years)
|
|
|
1 |
|
|
|
- |
|
|
|
1 |
|
|
|
4 |
|
Risk-free interest rates
|
|
|
0.2 |
% |
|
|
- |
|
|
|
0.2 |
% |
|
|
1.5 |
% |
Expected volatility
|
|
|
58 |
% |
|
|
- |
|
|
|
58 |
% |
|
|
44 |
% |
Dividend yield
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Weighted average fair value of restricted stock
|
|
$ |
27.40 |
|
|
|
- |
|
|
$ |
26.90 |
|
|
$ |
10.90 |
|
The Company’s investment policy has historically focused on three objectives: to preserve capital, to meet liquidity requirements, and to maximize total return. The Company’s investment policy established minimum ratings for each classification of investments when purchased and investment concentration is limited to minimize risk. The policy also limited the final maturity on any investment and the overall duration of the portfolio. During February 2012, the Company’s Board of Directors executed a written consent permitting the Company to invest up to $10 million in publicly traded companies engaged in certain oilfield servicing, energy services, and related businesses, which is an exception to the Company’s investment policy.
In June 2012, the Board established an Investment Committee, which was formed to develop investment strategies and set the Company’s investment policies with respect to the Company’s cash. The Investment Committee is authorized, among other things, to invest the Company’s excess cash directly or allocate investments to outside managers for investment in equity or debt securities, provided that the Investment Committee may not invest more than $25 million in any single investment or with any single asset manager without the Board’s approval. Given the overall market conditions, the Company regularly reviews its investment portfolio to ensure adherence to its investment policy and to monitor individual investments for risk analysis and proper valuation.
The Company’s portfolio of marketable securities at September 30, 2012 was as follows:
|
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term deposits
|
|
$ |
56,411 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
56,411 |
|
Mutual funds
|
|
|
10,000 |
|
|
|
900 |
|
|
|
- |
|
|
|
10,900 |
|
United States government securities
|
|
|
97,560 |
|
|
|
210 |
|
|
|
- |
|
|
|
97,770 |
|
Government agencies
|
|
|
455 |
|
|
|
- |
|
|
|
- |
|
|
|
455 |
|
Corporate securities
|
|
|
17,554 |
|
|
|
549 |
|
|
|
(967 |
) |
|
|
17,136 |
|
Commercial paper
|
|
|
22,042 |
|
|
|
29 |
|
|
|
- |
|
|
|
22,071 |
|
Corporate obligations
|
|
|
43,978 |
|
|
|
460 |
|
|
|
(1 |
) |
|
|
44,437 |
|
Total available-for-sale securities
|
|
|
248,000 |
|
|
|
2,148 |
|
|
|
(968 |
) |
|
|
249,180 |
|
Amounts classified as cash equivalents
|
|
|
(56,302 |
) |
|
|
- |
|
|
|
- |
|
|
|
(56,302 |
) |
Amounts classified as marketable securities
|
|
$ |
191,698 |
|
|
$ |
2,148 |
|
|
$ |
(968 |
) |
|
$ |
192,878 |
|
The Company’s portfolio of marketable securities at December 31, 2011 was as follows:
|
|
Cost
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term deposits
|
|
$ |
3,029 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
3,029 |
|
United States government securities
|
|
|
309,189 |
|
|
|
593 |
|
|
|
(3 |
) |
|
|
309,779 |
|
Government agencies
|
|
|
3,505 |
|
|
|
21 |
|
|
|
- |
|
|
|
3,526 |
|
Corporate obligations
|
|
|
1,513 |
|
|
|
8 |
|
|
|
- |
|
|
|
1,521 |
|
Total available-for-sale securities
|
|
|
317,236 |
|
|
|
622 |
|
|
|
(3 |
) |
|
|
317,855 |
|
Amounts classified as cash equivalents
|
|
|
(2,914 |
) |
|
|
- |
|
|
|
- |
|
|
|
(2,914 |
) |
Amounts classified as marketable securities
|
|
$ |
314,322 |
|
|
$ |
622 |
|
|
$ |
(3 |
) |
|
$ |
314,941 |
|
Sales of marketable securities resulted in gross realized gains of $0.1 and $0.2 million during the nine-month periods ended September 30, 2012 and 2011, respectively. The gross realized gains for the three-month periods ended September 30, 2012 and 2011 were immaterial. Sales of marketable securities resulted in gross realized losses of $0.3 million during the nine-month period ended September 30, 2011. The gross realized losses for the three-month and nine-month periods ended September 30, 2012 and the three-month period ended September 30, 2011 were immaterial.
The following table summarizes the fair value and gross unrealized losses of the Company’s available-for-sale marketable securities, aggregated by type of investment instrument and length of time that individual securities have been in a continuous unrealized loss position at September 30, 2012:
|
|
Less than 12 Months
|
|
|
12 Months or Greater
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. government securities
|
|
$ |
86,689 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
86,689 |
|
|
$ |
- |
|
Government agencies
|
|
$ |
455 |
|
|
$ |
- |
|
|
|
- |
|
|
|
- |
|
|
|
455 |
|
|
|
- |
|
Corporate securities
|
|
|
28,616 |
|
|
|
(2 |
) |
|
|
- |
|
|
|
- |
|
|
|
28,616 |
|
|
|
(2 |
) |
Total
|
|
$ |
115,760 |
|
|
$ |
(2 |
) |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
115,760 |
|
|
$ |
(2 |
) |
The following table summarizes the fair value and gross unrealized losses of the Company’s available-for-sale marketable securities, aggregated by type of investment instrument and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2011:
|
|
Less than 12 Months
|
|
|
12 Months or Greater
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. government securities
|
|
$ |
15,186 |
|
|
$ |
(3 |
) |
|
$ |
- |
|
|
$ |
- |
|
|
$ |
15,186 |
|
|
$ |
(3 |
) |
The Company’s investment portfolio consists of both corporate and government securities that generally mature within three years. The longer the duration of these securities, the more susceptible they are to changes in market interest rates and bond yields. As yields increase, those securities purchased with a lower yield-at-cost show a mark-to-market unrealized loss. All unrealized losses are due to changes in interest rates and bond yields. The Company has considered all available evidence and determined that the marketable securities in which unrealized losses were recorded in the three-month and nine-month periods ended September 30, 2012 and 2011 were not deemed to be other-than-temporary. The Company holds its marketable securities as available-for-sale and marks them to market.
The amortized cost and estimated fair value of investments in available-for-sale securities as of September 30, 2012 and December 31, 2011, by contractual maturity, were as follows:
|
|
September 30, 2012
|
|
|
December 31, 2011
|
|
|
|
Cost
|
|
|
|
|
|
Cost
|
|
|
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mature in one year or less
|
|
$ |
221,678 |
|
|
$ |
222,279 |
|
|
$ |
256,763 |
|
|
$ |
257,050 |
|
Mature after one year through three years
|
|
|
17,620 |
|
|
|
17,884 |
|
|
|
60,473 |
|
|
|
60,805 |
|
Mature after three years
|
|
|
8,702 |
|
|
|
9,016 |
|
|
|
- |
|
|
|
- |
|
Total
|
|
$ |
248,000 |
|
|
$ |
249,180 |
|
|
$ |
317,236 |
|
|
$ |
317,855 |
|
7. Fair Value Measurements
Fair value is defined as the price that would be received for selling an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The accounting standard surrounding fair value measurements establishes a fair value hierarchy, consisting of three levels, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
Financial Assets Measured at Fair Value on a Recurring Basis
The Company utilizes levels 1, 2 and 3 to value its financial assets on a recurring basis. Level 1 instruments use quoted prices in active markets for identical assets or liabilities, which include the Company’s cash accounts, short-term deposits and money market funds as these specific assets are liquid. Level 1 instruments also include United States government securities, government agencies, and states and municipalities, as these securities are backed by the federal or state governments and traded in active markets frequently with sufficient volume. Level 2 instruments are valued using the market approach, which uses quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities and include mortgage-backed securities, corporate obligations and asset-backed securities as similar or identical instruments can be found in active markets. Level 3 is supported by little or no market activity and requires a high level of judgment to determine fair value, which includes the Company’s two venture fund investments. The Company periodically monitors its two venture capital funds and records these investments within “Other long-term assets” on the Condensed Balance Sheets based on quarterly statements the Company receives from each of the funds. The statements are generally received one quarter in arrears, as more timely valuations are not practical. The statements reflect the net asset value, which the Company uses to determine the fair value for these investments, which (a) do not have a readily determinable fair value and (b) either have the attributes of an investment company or prepare their financial statements consistent with the measurement principles of an investment company. The assumptions used by the Company, due to lack of observable inputs, may impact the fair value of these equity investments in future periods. There were no changes in the fair value estimates from December 31, 2011. In the event that the carrying value of its equity investments exceeds their fair value, or the decline in value is determined to be other-than-temporary, the carrying value is reduced to its current fair value, which is recorded in “Interest and other income, net,” in the Condensed Statements of Income. At September 30, 2012, there were no significant transfers that occurred between any of the levels of the Company’s financial assets.
A summary of financial assets measured at fair value on a recurring basis at September 30, 2012 was as follows:
|
|
Total
|
|
|
|
|
|
Significant Other
Observable
Inputs
(Level 2)
|
|
|
Significant Unobservable Inputs (Level 3)
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, including short-term deposits1
|
|
$ |
56,411 |
|
|
$ |
56,411 |
|
|
$ |
- |
|
|
$ |
- |
|
Mutual funds2
|
|
|
10,900 |
|
|
|
10,900 |
|
|
|
- |
|
|
|
- |
|
United States government securities2
|
|
|
97,770 |
|
|
|
97,770 |
|
|
|
- |
|
|
|
- |
|
Government agencies2
|
|
|
455 |
|
|
|
455 |
|
|
|
- |
|
|
|
- |
|
Corporate securities2
|
|
|
17,136 |
|
|
|
17,136 |
|
|
|
- |
|
|
|
- |
|
Commercial paper2
|
|
|
22,071 |
|
|
|
- |
|
|
|
22,071 |
|
|
|
- |
|
Corporate obligations2
|
|
|
44,436 |
|
|
|
- |
|
|
|
44,436 |
|
|
|
- |
|
Non-controlling interests in certain funds3
|
|
|
1,097 |
|
|
|
- |
|
|
|
|
|
|
|
1,097 |
|
|
|
$ |
250,276 |
|
|
$ |
182,672 |
|
|
$ |
66,507 |
|
|
$ |
1,097 |
|
|
(1)
|
At September 30, 2012, the Company recorded $56.3 million and $0.1 million within “Cash and cash equivalents” and “Marketable securities,” respectively.
|
|
(2)
|
Recorded within “Marketable securities.”
|
|
(3)
|
Recorded within “Other long-term assets.”
|
A summary of financial assets measured at fair value on a recurring basis at December 31, 2011 was as follows:
|
|
Total
|
|
|
|
|
|
Significant
Other Observable
Inputs
(Level 2)
|
|
|
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, including short-term deposits1
|
|
$ |
8,601 |
|
|
$ |
8,601 |
|
|
$ |
- |
|
|
$ |
- |
|
United States government securities2
|
|
|
309,780 |
|
|
|
309,780 |
|
|
|
- |
|
|
|
- |
|
Government agencies2
|
|
|
3,526 |
|
|
|
3,526 |
|
|
|
- |
|
|
|
- |
|
Corporate obligations2
|
|
|
1,521 |
|
|
|
- |
|
|
|
1,521 |
|
|
|
- |
|
Non-controlling interests in certain funds3
|
|
|
1,117 |
|
|
|
- |
|
|
|
- |
|
|
|
1,117 |
|
Total
|
|
$ |
324,545 |
|
|
$ |
321,907 |
|
|
$ |
1,521 |
|
|
$ |
1,117 |
|
|
(1)
|
At December 31 2011, the Company recorded $8.5 million and $0.1 million within “Cash and cash equivalents” and “Marketable securities,” respectively.
|
|
(2)
|
Recorded within “Marketable securities.”
|
|
(3)
|
Recorded within “Other long-term assets.”
|
The Company’s other financial instruments include accounts payable and accrued and other liabilities. Carrying values of these financial liabilities approximate their fair values due to the relatively short maturity of these items. The related cost basis for the Company’s 3/4% Convertible Senior Notes due December 22, 2023 (the “3/4% Notes”) at September 30, 2012 and December 31, 2011 was approximately $0.3 million on both dates. Although the remaining balance of its 3/4% Notes is relatively small and the market trading is very limited, the Company expects the cost basis for the 3/4% Notes of approximately $0.3 million at September 30, 2012 to approximate fair value. The Company’s convertible debt is recorded at its carrying value, not the estimated fair value. The Company may seek to make open market repurchases of the remaining balance of its 3/4% Notes within the next twelve months. Accordingly, these notes are reflected as a current liability in the accompanying Condensed Balance Sheets.
Non-Financial Assets Measured at Fair Value on a Non-Recurring Basis
The Company had no non-financial assets measured at fair value on a non-recurring basis as of September 30, 2012 and December 31, 2011.
The Company regularly performs reviews of its long-lived assets to determine if facts or circumstances are present, either internal or external, which would indicate that the carrying values of its long-lived assets may not be recoverable. For more details, refer to the Summary of Significant Accounting Policies in Note 1 to the Consolidated Financial Statements in the Annual Report on Form 10-K for the fiscal year ended December 31, 2011.
Property and Equipment, Net
The components of property and equipment, net, as of September 30, 2012 and December 31, 2011 were as follows:
|
|
September 30, 2012
|
|
|
December 31, 2011
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
Rigs and workover equipment
|
|
$ |
42,978 |
|
|
$ |
11,750 |
|
Other equipment
|
|
|
24,092 |
|
|
|
3,205 |
|
Land and improvements
|
|
|
6,980 |
|
|
|
5,677 |
|
Buildings
|
|
|
5,623 |
|
|
|
- |
|
Vehicles
|
|
|
1,505 |
|
|
|
648 |
|
Furniture and fixtures
|
|
|
258 |
|
|
|
100 |
|
Assets in progress
|
|
|
1,044 |
|
|
|
- |
|
|
|
|
82,480 |
|
|
|
21,380 |
|
Accumulated depreciation
|
|
|
(5,558 |
) |
|
|
(320 |
) |
Property and equipment, net
|
|
$ |
76,922 |
|
|
$ |
21,060 |
|
The Other Equipment listed above primarily includes other Steel Energy equipment, such as pumps, rig vehicles, trailers, power swivels, BOP accumulators, and various tongs. The assets in progress include $0.8 million of payments toward a new rig and other oilfield services equipment at Sun Well and $0.2 million toward a new training facility and gate entry renovations at Baseball Heaven. During the nine-month period ended September 30, 2012, the Company wrote down all of the assets of The Show ($0.1 million) to zero-value, as The Show was not meeting forecasted projections, with no expectation to perform as represented when acquired. This impairment is included in “Loss from discontinued operations, net of taxes” in the Condensed Statement of Income. The assets disposed of are reported at the lower of their carrying amount or estimated fair value, less costs to sell.
Depreciation expense for the three-month period ended September 30, 2012 aggregated $2.5 million, with $2.4 million in “Cost of revenues” and $0.1 million in “Selling, general and administrative” expenses in the Condensed Statement of Income. Depreciation expense for the nine-month period ended September 30, 2012 aggregated $5.3 million, with $4.0 million in “Cost of revenues” and $1.3 million in “Selling, general and administrative” expenses in the Condensed Statement of Income. There was $0.1 million of depreciation expense in the three-month and nine-month periods ended September 30, 2011, which was included in “Selling, general and administrative” expenses in the Condensed Statement of Income.
Intangible Assets, Net
The components of intangible assets, net, as of September 30, 2012 were as follows:
|
|
Cost
|
|
|
|
|
|
Net
|
|
|
|
Estimated
Useful Life (years)
|
|
|
|
(in thousands)
|
|
|
|
|
|
Sports-Related:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer relationships
|
|
$ |
235 |
|
|
$ |
(55 |
) |
|
|
180 |
|
Straight-line
|
|
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oilfield Servicing:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer relationships
|
|
|
43,100 |
|
|
|
(4,217 |
) |
|
|
38,883 |
|
Accelerated
|
|
|
10 |
|
Trade names
|
|
|
4,100 |
|
|
|
(727 |
) |
|
|
3,373 |
|
Accelerated
|
|
|
5 |
|
|
|
|
47,200 |
|
|
|
(4,944 |
) |
|
|
42,256 |
|
|
|
|
|
|
Intangible assets, net
|
|
$ |
47,435 |
|
|
$ |
(4,999 |
) |
|
$ |
42,436 |
|
|
|
|
|
|
The components of intangible assets, net, as of December 31, 2011 were as follows:
|
|
Cost
|
|
|
|
|
|
Net
|
|
|
|
Estimated
Useful Life (years)
|
|
|
|
(in thousands) |
|
|
|
|
|
Sports-Related:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer relationships
|
|
$ |
235 |
|
|
$ |
(20 |
) |
|
|
215 |
|
Straight-line
|
|
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oilfield Servicing:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Customer relationships
|
|
|
4,700 |
|
|
|
(29 |
) |
|
|
4,671 |
|
Accelerated
|
|
|
10 |
|
Trade names
|
|
|
900 |
|
|
|
- |
|
|
|
900 |
|
Accelerated
|
|
|
5 |
|
|
|
|
5,600 |
|
|
|
(29 |
) |
|
|
5,571 |
|
|
|
|
|
|
Intangible assets, net
|
|
$ |
5,835 |
|
|
$ |
(49 |
) |
|
$ |
5,786 |
|
|
|
|
|
|
Amortization expense for the three-month and nine-month periods ended September 30, 2012 were $2.6 million and $5.0 million, respectively, and are included in “Selling, general and administrative” expenses in the Condensed Statements of Income. There was no amortization expense for the three-month and nine-month periods ended September 30, 2011.
Estimated aggregate future amortization expenses for the next five years for the intangible assets by reporting segment are as follows:
|
|
Steel Sports
|
|
|
Steel Energy
|
|
|
|
(in thousands)
|
|
For the year ended December 31:
|
|
|
|
|
|
|
2012 (remaining three months)
|
|
$ |
12 |
|
|
$ |
2,565 |
|
2013
|
|
|
47 |
|
|
|
8,534 |
|
2014
|
|
|
47 |
|
|
|
6,565 |
|
2015
|
|
|
47 |
|
|
|
5,267 |
|
2016
|
|
|
27 |
|
|
|
4,216 |
|
Thereafter
|
|
|
- |
|
|
|
15,109 |
|
|
|
$ |
180 |
|
|
$ |
42,256 |
|
Goodwill
Goodwill by reporting segment as of September 30, 2012 was as follows:
|
|
Steel Sports
|
|
|
Steel Energy
|
|
|
Total
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2011
|
|
$ |
1,989 |
|
|
$ |
6,255 |
|
|
$ |
8,244 |
|
Acquired goodwill
|
|
|
- |
|
|
|
37,127 |
|
|
|
37,127 |
|
Accumulated impairment (see Note 4)
|
|
|
(1,796 |
) |
|
|
- |
|
|
|
(1,796 |
) |
Balance, September 30, 2012
|
|
$ |
193 |
|
|
$ |
43,382 |
|
|
$ |
43,575 |
|
During the nine-month period ended September 30, 2012, the Company wrote off goodwill from The Show of $1.7 million, as The Show was not meeting forecasted projections, with no expectation to perform as represented when acquired. This impairment charge is included in “Loss from discontinued operations, net of taxes” in the Condensed Statement of Income.
The Company’s “Accrued and other liabilities” as of September 30, 2012 and December 31, 2011 were as follows:
|
|
September 30, 2012
|
|
|
December 31, 2011
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
Tax-related
|
|
$ |
1,738 |
|
|
$ |
56 |
|
Accrued compensation and related taxes
|
|
|
4,864 |
|
|
|
1,593 |
|
Deferred revenue
|
|
|
280 |
|
|
|
278 |
|
Professional services
|
|
|
20 |
|
|
|
485 |
|
Accrued workers compensation
|
|
|
- |
|
|
|
1,233 |
|
Other
|
|
|
2,080 |
|
|
|
181 |
|
Total
|
|
$ |
8,982 |
|
|
$ |
3,826 |
|
The Company’s “Other long-term liabilities” as of September 30, 2012 and December 31, 2011 were as follows:
|
|
September 30, 2012
|
|
|
December 31, 2011
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
Tax-related
|
|
$ |
7,340 |
|
|
$ |
10,737 |
|
Phantom stock liability
|
|
|
1,524 |
|
|
|
- |
|
|
|
$ |
8,864 |
|
|
$ |
10,737 |
|
The tax-related long-term liabilities relate to FIN 48 uncertainties primarily associated with our foreign subsidiaries. Through its acquisition of SWH, the Company has a phantom stock plan agreement (the “Phantom Plan”), in which the board of directors is authorized to grant phantom shares to employees and consultants. The value of the phantom shares was fixed at $1,543 per share as a result of the acquisition. If employees or consultants are terminated, their unvested shares are returned to the Phantom Plan. Phantom stockholders are entitled to receive a cash payment for their vested shares on February 1, 2016, unless there is a change of control or employee death. The Company is accounting for the unvested portion of the Phantom Plan as post-combination compensation expense by accreting a liability over the vesting period.
Sun Well has a credit agreement with Wells Fargo Bank, National Association that includes a term loan of $20,000,000 and a revolving line of credit for up to $5,000,000. The loans are secured by the assets of Sun Well and bear interest, at the option of Sun Well, at LIBOR plus 3.5% or the greater of (a) the bank’s prime rate, (b) the Federal Funds Rate plus 1.5%, or (c) the Daily One-Month LIBOR rate plus 1.5% for base rate loans. Both options are subject to leverage ratio adjustments. The interest payments are made monthly. The term loan is repayable in $1,000,000 quarterly principal installments from September 30, 2011 through June 30, 2015. Sun Well borrowed $20,000,000 on the term loan in July 2011 and has made $6,000,000 in scheduled principal payments through September 30, 2012. Borrowings under the revolving loan, which are determined based on eligible accounts receivable, mature on June 30, 2015. There is no balance due on the revolving loan as of September 30, 2012. Under the agreement, Sun Well is subject to certain financial covenants, with which it was in compliance as of September 30, 2012.
The future principal payments due on the notes payable are as follows:
|
|
Amount
|
|
|
|
(in thousands)
|
|
|
|
|
|
For the year ended December 31:
|
|
|
|
2012 (remaining three months)
|
|
$ |
- |
|
2013
|
|
|
4,000 |
|
2014
|
|
|
4,000 |
|
2015
|
|
|
6,000 |
|
|
|
$ |
14,000 |
|
10. Commitments and Contingencies
Contractual Obligations
Through its recent acquisitions, the Company assumed leases of property expiring in various dates through 2016 with the following non-cancelable obligations:
|
|
Amount
|
|
|
|
(in thousands)
|
|
For the year ended December 31:
|
|
|
|
2012 (remaining three months)
|
|
$ |
295 |
|
2013
|
|
|
811 |
|
2014
|
|
|
662 |
|
2015
|
|
|
583 |
|
2016
|
|
|
492 |
|
|
|
$ |
2,843 |
|
Through its acquisitions, the Company acquired certain equipment under capital lease obligations. The following is a schedule of the future annual minimum payments for these leases as of September 30, 2012:
For the year ended December 31:
|
|
|
|
2012 (remaining three months)
|
|
$ |
127 |
|
2013
|
|
|
458 |
|
2014
|
|
|
458 |
|
2015
|
|
|
458 |
|
2016
|
|
|
160 |
|
Total minimum lease payments
|
|
|
1,661 |
|
Less amount representing interest
|
|
|
(172 |
) |
|
|
|
|
|
Present value of net minimum lease payments
|
|
|
1,489 |
|
Less current portion
|
|
|
(405 |
) |
|
|
|
|
|
Capital lease obligations, net of current portion
|
|
$ |
1,084 |
|
Legal Proceedings
From time to time, we may be a party in legal actions in various U.S. and foreign jurisdictions, arising from the normal course of business. In the opinion of management, such legal actions are not expected to have a material adverse effect on our financial condition or results of operations.
11. Restructuring Charges
The Company implemented restructuring plans during its nine-month transition period ended December 31, 2010 and during fiscal 2010 and 2009. The goals of these plans were to bring the Company’s operational expenses to appropriate levels relative to its historical net revenues, while simultaneously implementing extensive company-wide expense-control programs. All expenses, including adjustments, associated with the Company’s restructuring plans are included in “Restructuring charges” in the Condensed Statements of Income. These plans were completed as of December 31, 2011 so there was no restructuring activity in the nine-month period ended September 30, 2012.
12. Interest and Other Income (Expense), Net
The components of “Interest and other income (expense), net” for the three-month and nine-month periods ended September 30, 2012 and 2011 were as follows:
|
|
Three-Month Period Ended:
September 30,
|
|
|
Nine-Month Period Ended:
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income, net
|
|
$ |
66 |
|
|
$ |
295 |
|
|
$ |
473 |
|
|
$ |
3,853 |
|
Realized currency translation gains (losses)
|
|
|
45 |
|
|
|
(181 |
) |
|
|
151 |
|
|
|
3,917 |
|
Write-off of loan to The Show
|
|
|
77 |
|
|
|
- |
|
|
|
(423 |
) |
|
|
- |
|
Gain (loss) on sale of fixed assets
|
|
|
70 |
|
|
|
- |
|
|
|
70 |
|
|
|
- |
|
Other
|
|
|
211 |
|
|
|
(132 |
) |
|
|
161 |
|
|
|
339 |
|
|
|
$ |
469 |
|
|
$ |
(18 |
) |
|
$ |
432 |
|
|
$ |
8,109 |
|
The realized currency translation gains are primarily the result of substantial liquidations of certain of the Company’s foreign subsidiaries. The Company wrote off its loan to The Show because The Show was not meeting forecasted projections, with no expectation to perform as represented when acquired, and has been reclassified as discontinued operations. Therefore, the Company does not anticipate repayment of its loan by The Show.
ASC topic–740-270, Interim Reporting - Income Taxes, requires companies to make the best estimate of the annual effective tax rate for the full fiscal year and use that rate to provide for income taxes on a current year-to-date basis. An exception applies to the current quarter because the Company is not able to provide a sufficiently precise forecast of income for the year. The Company recorded a benefit from income tax of $1.1 million and $0.3 million for the three-month and nine-month periods ended September 30, 2012, respectively. The benefit for the period ended September 30, 2012 is primarily the result of a Singapore tax refund. Other discrete items for the current quarter include the amortization of indefinite lived intangible assets, a mark-to-market adjustment to the value of available-for-sale securities, and the separation of discontinued operations from continuing operations.
The Company recorded a tax benefit of $2.7 million ($1.4 million in cash and $1.3 million of non-cash benefit) and $0.3 million for the three-month and nine-month periods ended September 30, 2011, respectively, primarily due to the reversal of reserves for foreign taxes as a result of a favorable settlement in Singapore. During the three-month period ended July 1, 2011, the Company made significant changes to its historic investment portfolio to move to primarily low-risk interest-bearing government securities. These changes were significant enough, in the Company’s judgment, to consider the legacy portfolio to have been disposed of for the purpose of tracking a disproportionate tax effect that arose in fiscal 2008. The nine-month period ended September 30, 2011 also included the Company realizing certain currency translation gains due to substantial liquidation of certain of its foreign subsidiaries during the period. These taxes were partially offset by income tax benefits from losses incurred in the Company’s foreign jurisdictions and the reversal of reserves for certain foreign taxes.
The Company accounts for income taxes in accordance with ASC topic 740, Income Taxes (“ASC 740”), which requires that deferred tax assets and liabilities are recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. ASC 740 also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that some or all of the deferred tax assets will not be realized. Based on its history of operating losses, the Company has offset its net deferred tax assets by a full valuation allowance. When realized (or earlier, if justified by the Company’s earning history), the asset will be reflected on the Company’s balance sheet and the reversal of the corresponding valuation allowance will result in a tax benefit being recorded in the statement of income in the respective period.
The Company continues to monitor the status of its net operating losses (“NOLs”), which may be used to offset future taxable income. If the Company underwent an ownership change, the NOLs would be subject to an annual limit on the amount of the taxable income that may be offset by its NOLs generated prior to the ownership change and, in such case, the Company may be unable to use a significant portion of its NOLs to offset taxable income. The Company has adopted a tax benefits preservation plan with the intention of reducing the likelihood of an ownership change and filed an amendment to its certificate of incorporation that restricts certain transfers of the Company’s common stock with the intention of preventing an ownership change. However, the Company cannot ensure these measures will be effective in deterring or preventing all transfers of the Company’s common stock that could result in such an ownership change. For details regarding the Company’s NOL carryforwards prior to the nine-month period ended September 30, 2012, please refer to Note 14 of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011.
The Company is subject to U.S. federal income tax as well as income taxes in many U.S. states and foreign jurisdictions in which the Company operates or formerly operated. As of September 30, 2012, fiscal years 2004 onward remained open to examination by the U.S. taxing authorities and fiscal years 1999 onward remained open to examination in various foreign jurisdictions. U.S. tax attributes generated in fiscal years 1999 onward also remain subject to adjustment in subsequent audits when they are utilized.
As of September 30, 2012, the Company’s total gross unrecognized tax benefits were $26.4 million, of which $5.7 million, if recognized, would affect the effective tax rate. As of December 31, 2011, the Company’s total gross unrecognized tax benefits were $29.9 million, of which $9.2 million, if recognized, would affect the effective tax rate.
The calculation of unrecognized tax benefits involves dealing with uncertainties in the application of complex global tax regulations. Management regularly assesses the Company’s tax positions in light of legislative, bilateral tax treaty, regulatory and judicial developments in the countries in which the Company conducts or formerly conducted business. Management believes that it is not reasonably possible that the gross unrecognized tax benefits will change significantly within the next 12 months; however, tax audits remain open and the outcome of any tax audits are inherently uncertain, which could change this judgment in any given quarter.
The Company currently reports its business in two reportable segments: Steel Sports and Steel Energy. The Company also maintains general operations as it continues to explore additional working capital redeployment opportunities. There were no reportable segments in the fiscal 2011 periods.
Segment information as of September 30, 2012 and for continuing operations for the nine-month period then ended was as follows:
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues for three months ended
|
|
$ |
1,257 |
|
|
$ |
33,037 |
|
|
$ |
- |
|
|
$ |
34,294 |
|
Net revenues for nine months ended
|
|
$ |
2,402 |
|
|
$ |
70,787 |
|
|
$ |
- |
|
|
$ |
73,189 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations for three months ended
|
|
$ |
(464 |
) |
|
$ |
5,566 |
|
|
$ |
(1,352 |
) |
|
$ |
3,750 |
|
Income (loss) from operations for nine months ended
|
|
$ |
(1,392 |
) |
|
$ |
14,606 |
|
|
$ |
(6,849 |
) |
|
$ |
6,365 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$ |
6,714 |
|
|
$ |
196,893 |
|
|
$ |
258,711 |
|
|
$ |
462,318 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
$ |
38 |
|
|
$ |
33,282 |
|
|
$ |
- |
|
|
$ |
33,320 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
$ |
192 |
|
|
$ |
43,383 |
|
|
$ |
- |
|
|
$ |
43,575 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
$ |
5,825 |
|
|
$ |
71,097 |
|
|
$ |
- |
|
|
$ |
76,922 |
|
15. Net (Loss) Income Per Share
Basic net (loss) income per share is computed by dividing net (loss) income by the weighted-average number of common shares outstanding during the period. Diluted net (loss) income per share gives effect to all potentially dilutive common shares outstanding during the period, which include certain stock-based awards, calculated using the treasury stock method, and convertible notes that are potentially dilutive at certain earnings levels, and are computed using the if-converted method. As disclosed in Note 1, all share information for the prior year period has been adjusted to reflect the Reverse/Forward Split.
A reconciliation of the numerator and denominator of the basic and diluted net (loss) income per share attributable to Steel Excel computations was as follows:
|
|
Three-Month Period Ended:
|
|
|
Nine-Month Period Ended:
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2012
|
|
|
2011
|
|
|
2012
|
|
|
2011
|
|
|
|
(in thousands), except per share amounts
|
|
Numerators (basic and diluted)
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations, net of taxes
|
|
$ |
5,324 |
|
|
$ |
1,250 |
|
|
$ |
7,109 |
|
|
$ |
1,517 |
|
Income from discontinued operations, net of taxes
|
|
$ |
25 |
|
|
$ |
85 |
|
|
$ |
(1,986 |
) |
|
$ |
6,915 |
|
Net income attributable to Steel Excel Inc.
|
|
$ |
5,349 |
|
|
$ |
1,335 |
|
|
$ |
5,703 |
|
|
$ |
8,432 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominators
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted-average shares outstanding
|
|
|
12,982 |
|
|
|
10,881 |
|
|
|
11,820 |
|
|
|
10,881 |
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based awards
|
|
|
19 |
|
|
|
21 |
|
|
|
20 |
|
|
|
14 |
|
3/4% subordinate notes
|
|
|
- |
|
|
|
3 |
|
|
|
- |
|
|
|
3 |
|
Diluted weighted-average shares outstanding
|
|
|
13,001 |
|
|
|
10,905 |
|
|
|
11,840 |
|
|
|
10,898 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations, net of taxes
|
|
$ |
0.41 |
|
|
$ |
0.11 |
|
|
$ |
0.60 |
|
|
$ |
0.14 |
|
|