The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes
are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except for per share data)
Casella Waste Systems, Inc. (Parent), its wholly-owned subsidiaries and certain partially owned entities over which it has
a controlling financial interest (collectively, we, us or our), is a regional, vertically-integrated solid waste services company that provides collection, transfer, disposal, landfill, landfill gas-to-energy,
recycling and organics services in the northeastern United States. We market recyclable metals, aluminum, plastics, paper and corrugated cardboard, which have been processed at our recycling facilities, as well as recyclables purchased from
third-parties. We manage our solid waste operations on a geographic basis through two regional operating segments, the Eastern and Western regions, each of which provides a full range of solid waste services, and our larger-scale recycling and
commodity brokerage operations through our Recycling segment. Organics services, ancillary operations, major customer accounts, discontinued operations and earnings from equity method investees are included in our Other segment.
The accompanying consolidated financial statements, which include the accounts of the Parent, its wholly-owned subsidiaries and certain partially owned
entities over which it has a controlling financial interest, have been prepared in accordance with generally accepted accounting principles in the United States (GAAP) pursuant to the rules and regulations of the Securities and Exchange
Commission ( SEC). All significant intercompany accounts and transactions are eliminated in consolidation. Investments in entities in which we do not have a controlling financial interest are accounted for under either the equity method
or cost method of accounting, as appropriate. Assets and liabilities of discontinued operations and assets held-for-sale are segregated from those of continuing operations and reported in separate captions in the balance sheet, as applicable. The
results of operations that have been disposed of or classified as held-for-sale and qualify for discontinued operations accounting are reported in discontinued operations, as applicable. See Note 17 for disclosure over discontinued operations.
2.
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ACCOUNTING CHANGES AND RECLASSIFICATIONS
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Adoption of New Accounting Pronouncements
Comprehensive Income
In February 2013, the Financial
Accounting Standards Board (FASB) issued an accounting standards update for the reporting of reclassifications out of accumulated other comprehensive income (loss). This guidance requires an entity to report the effect of significant
reclassifications out of accumulated other comprehensive income (loss) on the respective line items in net income (loss) or in the notes to consolidated financial statements if the amount being reclassified is required under GAAP to be reclassified
in its entirety to net income (loss). For other amounts not required under GAAP to be reclassified in their entirety to net income (loss) in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP
that provide additional detail about those amounts. This guidance is effective prospectively for annual and interim reporting periods within those years, beginning after December 15, 2012. We adopted this guidance effective May 1, 2013 and
it has not had, and we believe it will not have, a material impact on our consolidated financial statements. See Note 12 for presentation of the information required by this accounting standards update.
Indefinite-Lived Intangible Assets Impairment Testing
In
July 2012, the FASB issued an accounting standards update on indefinite-lived intangible assets impairment testing. This guidance permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair
value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative impairment test. If after assessing the totality of events or circumstances, an entity determines that it is
not more likely than not that the indefinite-lived intangible assets are impaired, then the entity will not need to perform the quantitative impairment test in accordance with FASB Accounting
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Standards Codification (ASC) 350-30. This guidance is effective for annual and interim indefinite-lived intangible assets impairment tests performed for annual reporting periods
beginning after September 15, 2012, with early adoption permitted. We adopted this guidance effective May 1, 2013 and it has not had, and we believe it will not have, a material impact on our consolidated financial statements as we
currently do not carry any indefinite-lived intangible assets on our consolidated balance sheet.
Disclosures About Offsetting Assets and Liabilities
In December 2011, the FASB issued an accounting standards update regarding the disclosure of offsetting assets and liabilities in financial
statements. This guidance requires an entity to disclose both gross information and net information about both instruments and transactions eligible for offset in the statement of financial position and instruments and transactions subject to an
agreement similar to a master netting arrangement. The objective of this disclosure is to facilitate comparison between those entities that prepare their financial statements on the basis of GAAP and those entities that prepare their financial
statements on the basis of International Financial Reporting Standards. In January 2013, the FASB issued an accounting standards update to address implementation issues about the December 2011 accounting standards update by clarifying the scope of
the offsetting disclosures. This guidance is effective for annual and interim reporting periods within those years, beginning on or after January 1, 2013. We adopted this guidance effective May 1, 2013 and it has not had, and we believe it
will not have, a material impact on our consolidated financial statements.
New Accounting Pronouncements Pending Adoption
Discontinued Operations
In April 2014, the FASB issued an
accounting standards update for the requirements of reporting discontinued operations. The update provides that an entity or a group of components of an entity is required to be reported in discontinued operations once the component of an entity
meets the held for sale criteria, is disposed of by sale or is disposed of other than by sale only if the disposal represents a strategic shift that has, or will have, a major effect on an entitys operations and financial results. The update
also requires that additional disclosures about discontinued operations be made. This guidance is effective prospectively for annual periods, and interim reporting periods within those years, beginning after December 15, 2014, with early
adoption permitted, but only for disposals, or classifications as held for sale, that have not been reported in financial statements previously issued or available for issuance. Adopting this standard may impact the presentation of, and disclosures
in, our consolidated financial statements and notes thereto.
Income Taxes
In July 2013, the FASB issued an accounting standards update for the reporting of an unrecognized tax benefit, or portion thereof, as a reduction to a deferred
tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. The update provides an exception, requiring the unrecognized tax benefit to be presented in the financial statements as a liability when the
carryforward is not available at the reporting date under the tax laws to settle additional income taxes that would result for the disallowance of a tax provision or the tax laws do not require the entity to use, and the entity does not intend to
use, the deferred tax asset for such purpose. This guidance is effective prospectively, with retrospective application permitted, for annual periods, and interim reporting periods within those years, beginning after December 15, 2013, with
early adoption permitted. We do not expect a material impact on our consolidated financial statements as a result of adopting this standard.
Reclassifications
We have made reclassifications to
amounts recorded in our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended April 30, 2013, including a reclassification to properly state the current deferred income tax asset and the
non-current deferred income tax liability. The reclassifications had no effect on the previously reported results of operations or retained earnings.
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3.
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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Managements Estimates and Assumptions
Preparation of our consolidated financial statements in accordance with GAAP requires management to make certain estimates and assumptions. These estimates and
assumptions affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues and expenses. We must make these estimates and assumptions because certain information that we use is dependent on future events, cannot be
calculated with a high degree of precision given the available data or simply cannot be readily calculated. In some cases, these estimates are difficult to determine, and we must exercise significant judgment. In preparing our consolidated financial
statements, the estimates and assumptions that we consider to be significant and present the greatest amount of uncertainty relate to our accounting for landfills, environmental remediation liabilities, asset impairments, accounts receivable
valuation allowance, self insurance reserves, deferred taxes and uncertain tax positions, estimates of the fair values of assets acquired and liabilities assumed in any acquisition, contingent liabilities and stock-based compensation. Each of these
items is discussed in additional detail elsewhere in these notes to consolidated financial statements. In the opinion of management, these consolidated financial statements include all adjustments, which include normal recurring and nonrecurring
adjustments, necessary for a fair presentation of the financial position, results of operations, and cash flows for the periods presented. Actual results may differ materially from the estimates and assumptions that we use in the preparation of our
consolidated financial statements.
Cash and Cash Equivalents
We consider all highly liquid investments purchased with original maturities of three months or less to be cash equivalents.
Concentrations of Credit Risk
Financial instruments that
potentially subject us to concentrations of credit risk consist of cash and cash equivalents, accounts receivable-trade and derivative instruments. We maintain cash and cash equivalents with banks that at times exceed applicable insurance limits. We
reduce our exposure to credit risk by maintaining such deposits with high quality financial institutions. Concentration of credit risk with respect to accounts
receivable-trade
is limited because a large
number of geographically diverse customers comprise our customer base, thus spreading the trade credit risk. At April 30, 2014 and 2013, no single group or customer represented greater than 5% of total accounts receivable-trade. We manage
credit risk through credit evaluations, credit limits and monitoring procedures. We may also use credit insurance from time to time. We perform ongoing credit evaluations of our customers, but generally do not require collateral to support accounts
receivable-trade. Credit risk related to derivative instruments results from the fact we at times enter into interest rate derivative and commodity price hedge agreements with various counterparties. We monitor our derivative positions by regularly
evaluating positions and the creditworthiness of the counterparties.
Accounts Receivable Trade, Net of Allowance for Doubtful Accounts
Accounts receivable trade represent receivables from customers for collection, transfer, recycling, disposal and other services. Our accounts receivable
trade are recorded when billed or when related revenue is earned, if earlier, and represent claims against third-parties that will be settled in cash. The carrying value of our accounts receivable trade, net of allowance for doubtful
accounts, represents its estimated net realizable value. Estimates are used in determining our allowance for doubtful accounts and are based on our historical collection experience, current trends, credit policy and a review of our accounts
receivable trade by aging category. Our reserve is evaluated and revised on a monthly basis. Past-due receivables are written off when deemed to be uncollectible.
Inventory
Inventory includes secondary fibers,
recyclables ready for sale and parts and supplies. Inventory is stated at the lower of cost (first-in, first-out) or market.
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Property, Plant and Equipment
Property, plant and equipment is recorded at cost, less accumulated depreciation and amortization. We provide for depreciation and amortization using the
straight-line method by charges to operations in amounts that allocate the cost of the assets over their estimated useful lives as follows:
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Asset Classification
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Estimated
Useful Life
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Buildings and improvements
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10-30 years
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Machinery and equipment
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5-10 years
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Rolling stock
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5-10 years
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Containers
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5-12 years
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Furniture and Fixtures
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3-8 years
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The cost of maintenance and repairs is charged to operations as incurred.
Landfill development costs are also included in property, plant and equipment. Landfill development costs include costs to develop each of our landfill sites,
including such costs related to landfill liner material and installation, excavation for airspace, landfill leachate collection systems, landfill gas collection systems, environmental monitoring equipment for groundwater and landfill gas, directly
related engineering, capitalized interest, on-site road construction and other capital infrastructure. Additionally, landfill development costs include all land purchases within the landfill footprint and the purchase of any required landfill buffer
property. Under life-cycle accounting, these costs are capitalized and charged to expense based on tonnage placed into each site. See the
Landfill Accounting
accounting policy below for disclosure over the amortization of landfill
development costs and Note 6 for disclosure over property, plant and equipment.
Landfill Accounting
Life Cycle Accounting
Under life-cycle accounting,
all costs related to acquisition and construction of landfill sites are capitalized and charged to expense based on tonnage placed into each site. Landfill permitting, acquisition and preparation costs are amortized on the units-of-consumption
method as landfill airspace is consumed. In determining the amortization rate for our landfills, preparation costs include the total estimated costs to complete construction of the landfills permitted and expansion capacity.
Landfill Development Costs
We estimate the total
cost to develop each of our landfill sites to its remaining permitted and expansion capacity (see landfill development costs discussed within the
Property, Plant and Equipment
accounting policy above). The projection of these
landfill costs is dependent, in part, on future events. The remaining amortizable basis of each landfill includes costs to develop a site to its remaining permitted and expansion capacity and includes amounts previously expended and capitalized, net
of accumulated airspace amortization, and projections of future purchase and development costs including capitalized interest. The interest capitalization rate is based on our weighted average interest rate incurred on borrowings outstanding during
the period. Interest capitalized for fiscal years 2014, 2013 and 2012 was $256, $368 and $407, respectively.
Landfill Airspace
We apply the following guidelines in determining a landfills remaining permitted and expansion airspace:
Remaining Permitted Airspace.
Our engineers, in consultation with third-party engineering consultants and surveyors, are responsible for determining
remaining permitted airspace at our landfills. The remaining permitted airspace is determined by an annual survey, which is then used to compare the existing landfill topography to the expected final landfill topography.
81
Expansion Airspace
. We currently include unpermitted expansion airspace in our estimate of remaining
permitted and expansion airspace in certain circumstances. To be considered expansion airspace all of the following criteria must be met:
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we control the land on which the expansion is sought;
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all technical siting criteria have been met or a variance has been obtained or is reasonably expected to be obtained;
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we have not identified any legal or political impediments which we believe will not be resolved in our favor;
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we are actively working on obtaining any necessary permits and we expect that all required permits will be received; and
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senior management has approved the project.
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For unpermitted airspace to be included in our estimate of
remaining permitted and expansion airspace, the expansion effort must meet all of the criteria listed above. These criteria are evaluated annually by our engineers, accountants, lawyers, managers and others to identify potential obstacles to
obtaining the permits. Once the remaining permitted and expansion airspace is determined in cubic yards, an airspace utilization factor (AUF) is established to calculate the remaining permitted and expansion capacity in tons. The AUF is
established using the measured density obtained from previous annual surveys. When we include the expansion airspace in our calculation of remaining permitted and expansion airspace, we include the projected costs for development, as well as the
projected asset retirement costs related to final capping, closure and post-closure of the expansion airspace in the amortization basis of the landfill.
After determining the costs and the remaining permitted and expansion capacity at each of our landfills, we determine the per ton rates that will be expensed
as waste is received and deposited at the landfill by dividing the costs by the corresponding number of tons. We calculate per ton amortization rates for assets associated with each final capping event, for assets related to closure and post-closure
activities and for all other costs capitalized or to be capitalized in the future for each landfill. These rates per ton are updated annually, or more frequently, as significant facts change.
It is possible that actual results, including the amount of costs incurred, the timing of final capping, closure and post-closure activities, our airspace
utilization or the success of our expansion efforts could ultimately turn out to be significantly different from our estimates and assumptions. To the extent that such estimates or related assumptions prove to be significantly different than actual
results, lower profitability may be experienced due to higher amortization rates, higher final capping, closure or post-closure rates, or higher expenses; or higher profitability may result if the opposite occurs. Most significantly, if it is
determined that the expansion capacity should no longer be considered in calculating the recoverability of the landfill asset, we may be required to recognize an asset impairment. If it is determined that the likelihood of receiving an expansion
permit has become remote, the capitalized costs related to the expansion effort are expensed immediately.
Final Capping, Closure and Post-Closure
Costs
The following is a description of our landfill asset retirement activities and our related accounting:
Final Capping Costs.
Final capping activities include the installation of liners, drainage, compacted soil layers and topsoil over areas of a landfill
where total airspace has been consumed and waste is no longer being received. Final capping activities occur throughout the life of the landfill. Our engineering personnel estimate the cost for each final capping event based on the acreage to be
capped and the final capping materials and activities required. The estimates also consider when these costs would actually be paid and factor in inflation and discount rates. The engineers then quantify the landfill capacity associated with each
final capping event and the costs for each event are amortized over that capacity as waste is received at the landfill.
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Closure and Post-Closure Costs.
Closure and post-closure costs represent future estimated costs related to
monitoring and maintenance of a solid waste landfill, after a landfill facility ceases to accept waste and closes. We estimate, based on input from our engineers, lawyers, accounting personnel and consultants, our future cost requirements for
closure and post-closure monitoring and maintenance based on our interpretation of the technical standards of the Subtitle D regulations and the air emissions standards under the Clean Air Act of 1970, as amended, as they are being applied on a
state-by-state basis. Closure and post-closure accruals for the cost of monitoring and maintenance include site inspection, groundwater monitoring, leachate management, methane gas control and recovery, and operation and maintenance costs to be
incurred for a period which is generally for a term of 30 years after final closure of a landfill. In determining estimated future closure and post-closure costs, we consider costs associated with permitted and permittable ai
r
space.
Our estimated future closure and post-closure costs, based on our interpretation of current requirements and proposed regulatory changes, are intended to
approximate fair value. Absent quoted market prices, our cost estimates are based on historical experience, professional engineering judgment and quoted or actual prices paid for similar work. Our estimate of costs to discharge final capping,
closure and post-closure asset retirement obligations for landfills are developed in todays dollars. These costs are then inflated to the period of performance using an estimate of inflation, which is updated annually (2.6% and 2.7% for fiscal
years 2014 and 2013, respectively). Final capping, closure and post-closure liabilities are discounted using the credit adjusted risk-free rate in effect at the time the obligation is incurred. The weighted average rate applicable to our asset
retirement obligations at April 30, 2014 is between approximately 9.0% and 9.5%, the range of the credit adjusted risk free rates effective since the adoption of guidance associated with asset retirement obligations in fiscal year 2004.
Accretion expense is necessary to increase the accrued final capping, closure and post-closure liabilities to the future anticipated obligation. To accomplish this, we accrete our final capping, closure and
post-closure
accrual balances using the same credit-adjusted risk-free rate that was used to calculate the recorded liability. Accretion expense on recorded landfill liabilities is recorded to cost of
operations from the time the liability is recognized until the costs are paid. Accretion expense on recorded landfill liabilities amounted to $3,967, $3,538 and $3,341 in fiscal years 2014, 2013 and 2012, respectively.
We provide for the accrual and amortization of estimated future obligations for closure and post-closure based on tonnage placed into each site. With regards
to final capping, the liability is recognized and the costs are amortized based on the airspace related to the specific final capping event. See Note 8 for disclosure over final capping, closure and post-closure costs asset retirement obligations.
We operate in states which require a certain portion of landfill final capping, closure and post-closure obligations to be secured by financial
assurance, which may take the form of surety bonds, letters of credit and restricted cash. Surety bonds securing closure and post-closure obligations at April 30, 2014 and 2013 totaled $133,847 and $128,551, respectively. Letters of credit
securing closure and post-closure obligations at April 30, 2014 and 2013 totaled $1,104 and $1,752, respectively. See Note 5 for disclosure over restricted cash securing closure and
post-closure
obligations.
Landfill Operating Lease Contracts
We entered into three landfill operation and management agreements in fiscal year 2004 and one landfill operation and management agreement in fiscal year 2006.
These agreements are long-term landfill operating contracts with government bodies whereby we receive tipping revenue, pay normal operating expenses and assume future final capping, closure and post-closure liabilities. The government body retains
ownership of the landfill. There is no bargain purchase option and title to the property does not pass to us at the end of the lease term. We allocate the consideration paid to the landfill airspace rights and underlying land lease based on the
relative fair values.
In addition to up-front or one-time payments, the landfill operating agreements require us to make future minimum rental payments,
including success/expansion fees, other direct costs and final capping, closure and
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post-closure costs. The value of all future minimum lease payments is amortized and charged to cost of operations over the life of the contract. We amortize the consideration allocated to
airspace rights as airspace is utilized on a units-of-consumption basis and such amortization is charged to cost of operations as airspace is consumed (e.g., as tons are placed into the landfill). The underlying value of any land lease is
amortized to cost of operations on a straight-line basis over the estimated life of the operating agreement. See Note 6 for disclosure over depletion of landfill operating lease contracts.
Leases
We lease property and equipment in the ordinary
course of our business. Our most significant lease obligations are for property and equipment specific to our industry. Our leases have varying terms. Some may include renewal or purchase options, escalation clauses, restrictions, lease concessions,
capital project funding, penalties or other obligations that we consider in determining minimum lease payments. Leases are classified as either operating leases or capital leases, as appropriate.
Operating Leases.
Many of our leases are operating leases. This classification generally can be attributed to either (i) relatively low fixed
minimum lease payments or (2) minimum lease terms that are much shorter than the assets economic useful lives. We expect that, in the normal course of business, our operating leases will be replaced by other leases, or replaced with fixed
asset expenditures. See Note 11 for disclosure over future minimum lease payments related to our operating leases.
Capital Leases.
We capitalize
assets acquired under capital leases at the inception of each lease and amortize them to depreciation expense over the lesser of the useful life of the asset or the lease term, as appropriate. The present value of the related lease payments is
recorded as a debt obligation. See Note 10 for disclosure over our future maturities of debt, which includes capital lease payments.
Goodwill and
Intangible Assets
Goodwill.
Goodwill is the excess of our purchase cost over the fair value of the net assets of acquired businesses. We do not
amortize goodwill, but as discussed in the
Asset Impairments
accounting policy below, we assess our goodwill for impairment at least annually. See Note 7 for disclosure over goodwill.
Intangible Assets.
Intangible assets consist primarily of covenants not-to-compete and customer lists. Intangible assets are recorded at fair value and
are amortized based on the economic benefit provided or using the
straight-line
method over their estimated useful lives. Covenants not-to-compete and customer lists are typically amortized over a term of no
more than 10 years. See Note 7 for disclosure over intangible assets.
Investments in Unconsolidated Entities
Investments in unconsolidated entities over which we have significant influence over the investees operating and financing activities are accounted for
under the equity method of accounting. Investments in affiliates in which we do not have the ability to exert significant influence over the investees operating and financing activities are accounted for under the cost method of accounting.
The following table summarizes our equity and cost method investments as of April 30, 2014 and 2013:
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April 30,
2014
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April 30,
2013
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Equity method investments
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$
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$
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3,766
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Cost method investments
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16,752
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16,486
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Investments in unconsolidated entities
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$
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16,752
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$
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20,252
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We monitor and assess the carrying value of our investments throughout the year for potential impairment and
write them down to their fair value when other-than-temporary declines exist. Fair value is generally based on (i) other third-party investors recent transactions in the securities; (ii) other information available regarding the current market
for similar assets and/or (iii) a market or income approach, as deemed appropriate.
When we assess the carrying value of our investments for potential
impairment, determining the fair value or our investments is reliant upon the availability of market information and/or other information provided by third-parties to be able to develop an estimate of fair value. Additionally, considerable judgment
is required in interpreting market data to develop the estimates of fair value. Accordingly, our estimates are not necessarily indicative of the amounts that we, or other holders of these investments, could realize in a current market exchange. The
use of different assumptions and/or estimation methodologies could have a significant effect on the estimated fair values. The current estimates of fair value could differ significantly from the amounts presented.
Equity Method Investments
GreenFiber.
In
fiscal year 2001, we entered into a joint venture agreement with Louisiana-Pacific Corporation (LP) to combine our respective cellulose insulation businesses into a single operating entity, US GreenFiber LLC (GreenFiber). On
December 5, 2013, we and LP executed a purchase and sale agreement with a limited liability company formed by Tenex Capital Partners, L.P., pursuant to which we and LP agreed to sell our membership interests in GreenFiber for total cash
consideration of $18,000 plus an expected working capital true up less any indebtedness and other unpaid transaction costs of GreenFiber as of the closing date. The transaction was completed on December 5, 2013 for $19,194 in gross cash
proceeds, including a $1,194 working capital adjustment. After netting indebtedness of GreenFiber and transaction costs, our 50% of the net cash proceeds amounted to $3,442. After considering the $593 impact of our unrealized losses relating to
derivative instruments in accumulated other comprehensive loss on our investment in GreenFiber, we recorded a gain on sale of equity method investment of $593 in the third quarter of fiscal year 2014. We had previously accounted for our 50%
membership interest in GreenFiber using the equity method of accounting.
Tompkins.
In May 2011, we finalized the terms of a joint venture
agreement with FCR, LLC (FCR) to form Tompkins County Recycling LLC (Tompkins), a joint venture that operates a material recovery facility (MRF) located in Tompkins County, New York and processes and sells
commodities delivered to the Tompkins MRF. On December 31, 2013, we purchased the remaining 50% membership interest of Tompkins for total cash consideration of $425. The acquisition-date fair value of our investment in Tompkins, which was
determined using the cost approach based on an assessment of the price to purchase the acquired assets of Tompkins, prior to the acquisition date was $300.We recognized a $106 gain through loss from equity method investments due to the remeasurement
in fiscal year 2014. As a result of the purchase, we no longer account for our investment in Tompkins using the equity method of accounting and began including the results of Tompkins in our consolidated financial statements.
Fair Value of Financial Instruments
Our financial
instruments include cash and cash equivalents, accounts receivable-trade, restricted trust and escrow accounts, interest rate derivatives, trade payables and long-term debt. Accounting standards include disclosure requirements around fair values
used for certain financial instruments and establish a fair value hierarchy. The three-tier hierarchy prioritizes valuation inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each
fair value measurement is reported in one of three levels: Level 1, defined as quoted market prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than Level 1 that are observable, either directly or
indirectly, such as quoted prices for similar assets or liabilities; and Level 3, defined as unobservable inputs that are not corroborated by market data. See Note 10 and Note 13 for fair value disclosure over long-term debt and financial
instruments, respectively. See the
Derivatives and Hedging
accounting policy below for the fair value disclosure over interest rate derivatives.
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Business Combinations
We acquire businesses in the waste industry, including non-hazardous waste collection, transfer station, material recovery facilities and disposal operations,
as part of our growth strategy. Businesses are included in the consolidated financial statements from the date of acquisition.
We recognize, separately
from goodwill, the identifiable assets acquired and liabilities assumed at their estimated acquisition-date fair values. We measure and recognize goodwill as of the acquisition date as the excess of: (a) the aggregate of the fair value of
consideration transferred, the fair value of any noncontrolling interest in the acquiree (if any) and the acquisition date fair value of our previously held equity interest in the acquiree (if any), over (b) the fair value of net assets
acquired and liabilities assumed. If information about facts and circumstances existing as of the acquisition date is incomplete by the end of the reporting period in which a business combination occurs, we will report provisional amounts for the
items for which the accounting is incomplete. The measurement period ends once we receive the information we were seeking; however, this period will not extend beyond one year from the acquisition date. Any material adjustments recognized during the
measurement period will be recognized retrospectively in the consolidated financial statements of the current period. All acquisition related transaction and restructuring costs are to be expensed as incurred. See Note 4 for disclosure over business
acquisitions.
Environmental Remediation Liabilities
We have recorded environmental remediation liabilities representing our estimate of the most likely outcome of the matters for which we have determined that a
liability is probable. These liabilities include potentially responsible party investigations, settlements, certain legal and consultant fees, as well as costs directly associated with site investigation and clean up, such as materials and
incremental internal costs directly related to the remedy. We provide for expenses associated with environmental remediation obligations when such amounts are probable and can be reasonably estimated. We estimate costs required to remediate sites
where it is probable that a liability has been incurred based on site-specific facts and circumstances. Estimates of the cost for the likely remedy are developed using third-party environmental engineers or other service providers. Where we believe
that both the amount of a particular environmental remediation liability and timing of payments are reliably determinable, we inflate the cost in current dollars until the expected time of payment and discount the cost to present value. See Note 11
for disclosure over environmental remediation liabilities.
Self-Insurance Liabilities and Related Costs
We are self-insured for vehicles and workers compensation. Our maximum exposure in fiscal year 2014 under the workers compensation plan is $1,000
per individual event, after which reinsurance takes effect. Our maximum exposure in fiscal year 2014 under the automobile plan is $1,000 per individual event, after which reinsurance takes effect. The liability for unpaid claims and associated
expenses, including incurred but not reported losses, is determined by management with the assistance of a third-party actuary and reflected in our consolidated balance sheet as an accrued liability. We use a third-party to track and evaluate actual
claims experience for consistency with the data used in the annual actuarial valuation. The actuarially determined liability is calculated based on historical data, which considers both the frequency and settlement amount of claims. Our
self-insurance reserves totaled $10,280 and $11,362 at April 30, 2014 and 2013, respectively. Our estimated accruals for these liabilities could be significantly different than our ultimate obligations if variables such as the frequency or
severity of future events differ significantly from our assumptions.
Income Taxes
We use estimates to determine our provision for income taxes and related assets and liabilities and any valuation allowance recorded against our net deferred
tax assets. Valuation allowances have been established for the possibility that tax benefits may not be realized for certain deferred tax assets. Deferred income taxes are recognized based on the expected future tax consequences of differences
between the financial statement basis
86
and the tax basis of assets and liabilities, calculated using currently enacted tax rates. We record net deferred tax assets to the extent we believe these assets will more likely than not be
realized. In making this determination, we consider all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial operations. In
the event we determine that we would be able to realize our deferred income tax assets in the future in excess of their net recorded amount, we will make an adjustment to the valuation allowance which would reduce the provision for income taxes.
We account for income tax uncertainties according to guidance on the recognition, de-recognition and measurement of potential tax benefits associated
with tax positions. We recognize interest and penalties relating to income tax matters as a component of income tax expense. See Note 15 for disclosure related to income taxes.
Derivatives and Hedging
We account for derivatives and
hedging activities in accordance with derivatives and hedging accounting guidance that establishes accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts)
be recorded in the balance sheet as either an asset or liability measured at its fair value. The guidance also requires that changes in the derivatives fair value be recognized currently in earnings unless specific hedge accounting criteria
are met. Our objective for utilizing derivative instruments is to reduce our exposure to fluctuations in cash flows due to changes in the commodity prices of recycled paper and adverse movements in interest rates.
Our strategy to hedge against fluctuations in the commodity prices of recycled paper is to enter into hedges to mitigate the variability in cash flows
generated from the sales of recycled paper at floating prices, resulting in a fixed price being received from these sales. We evaluate the hedges and ensure that these instruments qualify for hedge accounting pursuant to derivative and hedging
guidance. Designated as effective cash flow hedges, the change in the fair value of these derivatives is recognized in other comprehensive income (loss) until the hedged item is settled and recognized as part of commodity revenue.
If the price per short ton of the underlying commodity, as reported on the Official Board Market, is less than the contract price per short ton, we receive
the difference between the average price and the contract price (multiplied by the notional tons) from the respective counter-party. If the price per short ton of the underlying commodity exceeds the contract price per short ton, we pay the
calculated difference to the counter-party.
The fair value of commodity hedges are obtained or derived from our counter-parties using valuation models
that take into consideration market price assumptions for commodities based on underlying active markets. We were not party to any commodity hedge contracts as of April 30, 2014 and 2013.
Our strategy to hedge against fluctuations in variable interest rates involves entering into interest rate derivative agreements to hedge against adverse
movements in interest rates. For interest rate derivatives deemed to be effective cash flow hedges, the change in fair value is recorded in our stockholders (deficit) equity as a component of accumulated other comprehensive income (loss) and
included in interest expense at the same time as interest expense is affected by the hedged transaction. Differences paid or received over the life of the agreements are recorded as additions to or reductions of interest expense on the underlying
debt. We were not party to any interest rate derivative agreements deemed to be effective cash flow hedges as of April 30, 2014 and 2013. For interest rate derivatives deemed to be ineffective cash flow hedges, the change in fair value is
recorded through earnings and included in loss on derivative instruments. We are party to two interest rate derivative agreements, which we entered into in fiscal year 2012, that are deemed to be ineffective cash flow hedges.
We entered into these two interest rate derivative agreements to hedge the interest rate risk associated with a forecasted financing transaction to redeem our
previously outstanding 11% senior second lien notes (Second Lien Notes) effective January 15, 2013. The total notional amount of these interest rate derivative agreements is $150,000. The agreements require us to receive interest
based on changes in the London Interbank Offered Rate
87
(LIBOR) index and pay interest at a rate of approximately 1.40%. The agreements mature on March 15, 2016. We dedesignated both of the $75,000 interest rate derivative agreements
in fiscal year 2013 and discontinued hedge accounting in accordance with ASC 815-30 because the interest payments associated with the forecasted financing transaction were no longer deemed probable due to the redemption of our Second Lien Notes as
discussed in Note 10. We reclassified a $3,626 loss from accumulated other comprehensive income (loss) to earnings as a loss on derivative instruments in fiscal year 2013.
The fair value of these two interest rate derivatives are calculated based on the three month LIBOR yield curve that is observable at commonly quoted
intervals for the full term of the swaps, adjusted by the credit risk of our
counter-parties
and us based on observable credit default swap rates. We recognize all derivatives on the balance sheet at fair
value.
Contingent Liabilities
We are subject to
various legal proceedings, claims and regulatory matters, the outcomes of which are subject to significant uncertainty. We determine whether to disclose or accrue for loss contingencies based on an assessment of whether the risk of loss is remote,
reasonably possible or probable, and whether it can be reasonably estimated. We analyze our litigation and regulatory matters based on available information to assess the potential liabilities. Managements assessment is developed based on an
analysis of possible outcomes under various strategies. We accrue for loss contingencies when such amounts are probable and reasonably estimable. If a contingent liability is only reasonably possible, we will disclose the potential range of the
loss, if estimable. We record losses related to contingencies in cost of operations or general and administration expenses, depending on the nature of the underlying transaction leading to the loss contingency. See Note 11 for disclosure over loss
contingencies. Contingent liabilities recorded in purchase accounting are recorded at their fair values. These fair values may be different from the values we would have otherwise recorded, had the contingent liability not been assumed as part of an
acquisition of a business. See Note 4 for disclosure over a contingent liability assumed as part of the acquisition of a business.
Revenue Recognition
We recognize collection, transfer, recycling and disposal revenues as the services are provided. Certain customers are billed in advance and,
accordingly, recognition of the related revenues is deferred until the services are provided.
Revenues from the sale of recycled materials are recognized
upon shipment. Rebates to certain municipalities based on sales of recyclable materials are recorded upon the sale of such recyclables to third-parties and are included as a reduction of revenues. Revenues for processing of recyclable materials are
recognized when the related service is provided. Revenues from the brokerage of recycled materials are recognized on a net basis at the time of shipment.
Asset Impairments
Recovery of Long-Lived Assets.
We continually assess whether events or changes in circumstances have occurred that may warrant revision of the estimated useful lives of our long-lived assets (other than goodwill) or whether the remaining balances of those assets should be
evaluated for possible impairment. Long-lived assets include, for example, capitalized landfill costs, other property and equipment, and identifiable intangible assets. Events or changes in circumstances that may indicate that an asset may be
impaired include the following:
|
|
a significant decrease in the market price of an asset or asset group;
|
|
|
a significant adverse change in the extent or manner in which an asset or asset group is being used or in its physical condition;
|
|
|
a significant adverse change in legal factors or in the business climate that could affect the value of an asset or asset group, including an adverse action or assessment by a regulator;
|
88
|
|
an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset;
|
|
|
a current period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or
asset group;
|
|
|
a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life; or
|
|
|
an impairment of goodwill at a reporting unit.
|
There are certain indicators listed above that require
significant judgment and understanding of the waste industry when applied to landfill development or expansion. For example, a regulator may initially deny a landfill expansion permit application although the expansion permit is ultimately granted.
In addition, management may periodically divert waste from one landfill to another to conserve remaining permitted landfill airspace. Therefore, certain events could occur in the ordinary course of business and not necessarily be considered
indicators of impairment due to the unique nature of the waste industry.
If an impairment indicator occurs, we perform a test of recoverability by
comparing the carrying value of the asset or asset group to its undiscounted expected future cash flows. We group our long-lived assets for this purpose at the lowest level for which identifiable cash flows are largely independent of the cash flows
of other assets or asset groups. If the carrying values are in excess of undiscounted expected future cash flows, we measure any impairment by comparing the fair value of the asset or asset group to its carrying value.
To determine fair value, we use discounted cash flow analyses and estimates about the future cash flows of the asset or asset group. This analysis includes a
determination of an appropriate discount rate, the amount and timing of expected future cash flows and growth rates. The cash flows employed in our discounted cash flow analyses are typically based on financial forecasts developed internally by
management. The discount rate used is commensurate with the risks involved. We may also rely on third-party valuations and or information available regarding the market value for similar assets.
If the fair value of an asset or asset group is determined to be less than the carrying amount of the asset or asset group, impairment in the amount of the
difference is recorded in the period that the impairment occurs. Estimating future cash flows requires significant judgment and projections may vary from the cash flows eventually realized.
See Note 16 for disclosure related to asset impairments recognized during the reporting periods.
Goodwill.
We annually assess goodwill impairment at the end of the fourth quarter of our fiscal year, or more frequently if events or circumstances
indicate that impairment may exist.
We assess whether a goodwill impairment exists using both qualitative and quantitative assessments. Our qualitative
assessment involves determining whether events or circumstances exist that indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If based on this qualitative assessment we
determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we will not perform a quantitative assessment.
If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, or if we
elect not to perform a qualitative assessment, we perform a quantitative assessment, or two-step impairment test, to determine whether goodwill impairment exists at the reporting unit.
In the first step (defined as Step 1) of testing for goodwill impairment, we estimate the fair value of each reporting unit, which we have
determined to be our geographic operating segments, our Recycling segment and our Customer Solutions operations, which is included in the Other segment, and compare the fair value with the
89
carrying value of the net assets of each reporting unit. If the fair value is less than its carrying value, then we would perform a second step (defined as Step 2) and determine the
fair value of the goodwill. In Step 2, the fair value of goodwill is determined by deducting the fair value of a reporting units identifiable assets and liabilities from the fair value of the reporting unit as a whole, as if that reporting
unit had just been acquired and the purchase price were being initially allocated.
To determine the fair value of each of our reporting units as a whole
we use discounted cash flow analyses, which require significant assumptions and estimates about the future operations of each reporting unit. Significant judgments inherent in this analysis include the determination of appropriate discount rates,
the amount and timing of expected future cash flows and growth rates. The cash flows employed in our discounted cash flow analyses are based on financial forecasts developed internally by management. Our discount rate assumptions are based on an
assessment of our risk adjusted discount rate, applicable for each reporting unit. In assessing the reasonableness of our determined fair values of our reporting units, we evaluate our results against our current market capitalization
If the fair value of the goodwill is less than its carrying value for a reporting unit, an impairment charge would be recorded to earnings. The loss
recognized cannot exceed the carrying amount of goodwill. After a goodwill impairment loss is recognized, the adjusted carrying amount of goodwill becomes its new accounting basis.
In addition to an annual goodwill impairment assessment, we would evaluate a reporting unit for impairment if events or circumstances change between annual
tests indicating a possible impairment. Examples of such events or circumstances include the following:
|
|
a significant adverse change in legal status or in the business climate;
|
|
|
an adverse action or assessment by a regulator;
|
|
|
a more likely than not expectation that a segment or a significant portion thereof will be sold; or
|
|
|
the testing for recoverability of a significant asset group within the segment.
|
We elected not to perform a
qualitative analysis as part of our annual goodwill impairment test in fiscal year 2014. As of April 30, 2014, the Step 1 testing for goodwill impairment performed for the Eastern, Western, Recycling and Customer Solutions reporting units
indicated that the fair value of each reporting unit exceeded its carrying amount, including goodwill. Furthermore, the Step 1 test indicated that the fair value of the Eastern, Western, Recycling and Customer Solutions reporting units exceeded
their carrying values by 25.8%, 34.3%, 8.2% and 74.0%, respectively. The fair value of the Recycling reporting unit, which is allocated $12,315 of goodwill at April 30, 2014, exceeded its carrying amount by $4,110. We incurred no impairment of
goodwill as a result of our annual fourth quarter goodwill impairment tests in fiscal years 2014, 2013 or 2012. However, there can be no assurance that goodwill will not be impaired at any time in the future.
Equity Method Investments.
In fiscal year 2012, our loss on equity method investment associated with GreenFiber includes a $5,090 goodwill impairment
charge as GreenFiber performed a goodwill impairment analysis that indicated the carrying value of their reporting unit exceeded the fair value of their reporting unit and determined that the entire amount of their goodwill was impaired.
Based on the goodwill impairment analysis performed by GreenFiber in fiscal year 2012, we determined that the book value of our investment in GreenFiber
exceeded its fair value. The analysis calculated GreenFibers fair value based on the income approach using discounted cash flows taking into account current expectations for asset utilization, housing starts and the remaining useful life of
related assets. We recorded a charge of $10,680 as impairment on equity method investment in fiscal year 2012.
90
Stock-Based Compensation
All share-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the
employees requisite service period. Stock-based compensation expense is based on the number of awards ultimately expected to vest and is therefore reduced for an estimate of the awards that are expected to be forfeited prior to vesting.
The fair value of each stock option is estimated using a Black-Scholes option pricing model, which requires extensive use of accounting judgment and financial
estimation, including estimates of the expected term option holders will retain their vested stock options before exercising them and the estimated volatility of our common stock price over the expected term. See Note 12 for disclosure over
stock-based compensation.
Earnings per Share
Basic
earnings per share is computed by dividing the net loss from continuing operations attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated based on
the combined weighted average number of common shares and potentially dilutive shares, which include, where appropriate, the assumed exercise of employee stock options, unvested restricted stock awards, unvested restricted stock units and unvested
performance stock units. In computing diluted earnings per share, we utilize the treasury stock method. See Note 18 for disclosure over the calculation of earnings per share.
Discontinued Operations
We analyze our operations that
have been divested or classified as held-for-sale to determine if they qualify for discontinued operations accounting. Only operations that qualify as a component of an entity, as defined by the ASC, can be classified as a discontinued operation. In
addition, only components where the cash flows of the component have been or will be eliminated from ongoing operations by the end of the assessment period and where we do not have a significant continuing involvement with the divested operations
would qualify for discontinued operations accounting. See Note 17 for disclosure over discontinued operations.
Change in Fiscal Year
On June 24, 2014, our Board of Directors approved the change of our fiscal year-end from April 30th to December 31st, effective January 1, 2015. Under this
change, we will report an 8-month transition period ending December 31, 2014, and then subsequently our full fiscal year ending December 31, 2015. During the 8-month transition period, we will report for the quarters ending July 31, 2014 and October
31, 2014.
Subsequent Events
Except as disclosed, no
material subsequent events have occurred since April 30, 2014 through the date of this filing that require recognition or disclosure in our current period consolidated financial statements.
We acquired various businesses during fiscal years 2014 and 2013, including several solid waste hauling operations, a transfer station, a
material recovery facility and an industrial service management business (included in the Other segment). The operating results of these businesses are included in the accompanying audited consolidated statements of operations from each date of
acquisition, and the purchase price has been allocated to the net assets acquired based on fair values at each date of acquisition, with the residual amounts recorded as goodwill. Acquired intangible assets other than goodwill that are subject to
amortization include
client lists and non-compete covenants. These are amortized over a five to ten year period from the date of
91
acquisition. All amounts recorded to goodwill, except amounts related to the acquisition of Bestway Disposal Services and BBI Waste Services (BBI) in fiscal year 2013, are expected to
be deductible for tax purposes. See Note 15 for disclosure over the tax impact associated with the acquisition of BBI.
The purchase price paid for these
acquisitions during fiscal years 2014 and 2013 and the allocation of the purchase price is as follows:
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Purchase Price:
|
|
|
|
|
|
|
|
|
Cash used in acquisitions, net of cash acquired
|
|
$
|
7,860
|
|
|
$
|
25,225
|
|
Common stock issued
|
|
|
|
|
|
|
2,650
|
|
Other non-cash considerations
|
|
|
555
|
|
|
|
|
|
Contingent consideration and holdbacks (1)
|
|
|
1,653
|
|
|
|
33
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
10,068
|
|
|
|
27,908
|
|
Current assets
|
|
|
814
|
|
|
|
1,422
|
|
Equipment
|
|
|
2,010
|
|
|
|
9,423
|
|
Other liabilities, net
|
|
|
(241
|
)
|
|
|
(7,009
|
)
|
Intangible assets
|
|
|
4,302
|
|
|
|
9,850
|
|
|
|
|
|
|
|
|
|
|
Fair value of assets acquired and liabilities assumed
|
|
|
6,885
|
|
|
|
13,686
|
|
|
|
|
|
|
|
|
|
|
Excess purchase price to be allocated to goodwill
|
|
$
|
3,183
|
|
|
$
|
14,222
|
|
|
|
|
|
|
|
|
|
|
(1)
|
In the fourth quarter of fiscal year 2014, we recovered a portion of the purchase price holdback amount we had previously paid and were relieved of any potential contingent consideration obligation associated with the
acquisition of an industrial service management business completed earlier in fiscal year 2014. As a result, we recorded a $1,058 gain on settlement of acquisition related contingent consideration in fiscal year 2014.
|
The following unaudited pro forma combined information shows the results of our continuing operations for fiscal years 2014 and 2013 as though each of the
acquisitions completed in fiscal years 2014 and 2013 had occurred as of May 1, 2012.
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended
April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Revenue
|
|
$
|
501,713
|
|
|
$
|
478,039
|
|
Operating income
|
|
$
|
12,698
|
|
|
$
|
14,748
|
|
Net loss attributable to common stockholders
|
|
$
|
(22,779
|
)
|
|
$
|
(53,763
|
)
|
Basic and diluted loss per common share attributable to common stockholders
|
|
$
|
(0.57
|
)
|
|
$
|
(1.58
|
)
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted average shares outstanding
|
|
|
39,820
|
|
|
|
34,015
|
|
|
|
|
|
|
|
|
|
|
The pro forma results have been prepared for comparative purposes only and are not necessarily indicative of the actual
results of operations had the acquisitions taken place as of May 1, 2012 or the results of our future operations. Furthermore, the pro forma results do not give effect to all cost savings or incremental costs that may occur as a result of the
integration and consolidation of the completed acquisitions.
92
5.
|
RESTRICTED CASH / RESTRICTED ASSETS
|
Restricted cash / restricted assets consist of cash and investments held in trust on deposit with various banks as collateral for our
obligations relative to our landfill final capping, closure and post-closure costs. A summary of restricted cash / restricted assets as of April 30, 2014 and 2013 is as follows:
|
|
|
|
|
|
|
|
|
|
|
April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Current:
|
|
|
|
|
|
|
|
|
Landfill closure
|
|
$
|
76
|
|
|
$
|
76
|
|
|
|
|
|
|
|
|
|
|
Non Current:
|
|
|
|
|
|
|
|
|
Landfill closure
|
|
$
|
681
|
|
|
$
|
545
|
|
|
|
|
|
|
|
|
|
|
6.
|
PROPERTY, PLANT AND EQUIPMENT
|
Property, plant and equipment as of April 30, 2014 and 2013 consists of the following:
|
|
|
|
|
|
|
|
|
|
|
April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Land
|
|
$
|
21,445
|
|
|
$
|
20,722
|
|
Landfills
|
|
|
496,515
|
|
|
|
475,855
|
|
Landfill operating lease contracts
|
|
|
115,867
|
|
|
|
109,363
|
|
Buildings and improvements
|
|
|
134,787
|
|
|
|
133,330
|
|
Machinery and equipment
|
|
|
117,193
|
|
|
|
120,314
|
|
Rolling stock
|
|
|
128,155
|
|
|
|
128,038
|
|
Containers
|
|
|
85,397
|
|
|
|
80,447
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,099,359
|
|
|
|
1,068,069
|
|
Less: accumulated depreciation and amortization
|
|
|
695,935
|
|
|
|
645,567
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
403,424
|
|
|
$
|
422,502
|
|
|
|
|
|
|
|
|
|
|
Depreciation expense for fiscal years 2014, 2013 and 2012 was $33,094, $34,065 and $37,829, respectively. Landfill
amortization expense for fiscal years 2014, 2013 and 2012 was $24,689, $21,206 and $19,957, respectively. Depletion expense on landfill operating lease contracts for fiscal years 2014, 2013 and 2012 was $9,948, $9,372 and $8,482, respectively, and
was recorded in cost of operations.
7.
|
GOODWILL AND INTANGIBLE ASSETS
|
The following tables show the activity and balances related to goodwill from April 30, 2012 through April 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 30, 2013
|
|
|
Acquisitions
|
|
|
Other (1)
|
|
|
April 30, 2014
|
|
Eastern region
|
|
$
|
16,858
|
|
|
$
|
539
|
|
|
$
|
32
|
|
|
$
|
17,429
|
|
Western region
|
|
|
86,880
|
|
|
|
790
|
|
|
|
(4
|
)
|
|
|
87,666
|
|
Recycling
|
|
|
12,190
|
|
|
|
125
|
|
|
|
|
|
|
|
12,315
|
|
Other
|
|
|
|
|
|
|
1,729
|
|
|
|
|
|
|
|
1,729
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
115,928
|
|
|
$
|
3,183
|
|
|
$
|
28
|
|
|
$
|
119,139
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 30, 2012
|
|
|
Acquisitions
|
|
|
Other (2)
|
|
|
April 30, 2013
|
|
Eastern region
|
|
$
|
58
|
|
|
$
|
12,939
|
|
|
$
|
3,861
|
|
|
$
|
16,858
|
|
Western region
|
|
|
89,458
|
|
|
|
1,283
|
|
|
|
(3,861
|
)
|
|
|
86,880
|
|
Recycling
|
|
|
12,190
|
|
|
|
|
|
|
|
|
|
|
|
12,190
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
101,706
|
|
|
$
|
14,222
|
|
|
$
|
|
|
|
$
|
115,928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Goodwill adjustments related to prior year acquisition activity, including the finalization of the deferred tax liability associated with the December 5, 2012 BBI acquisition.
|
(2)
|
Goodwill reclassification between the Eastern and Western regions is associated with the realignment of certain operations between the reporting units during fiscal year 2013.
|
Intangible assets as of April 30, 2014 and 2013 consist of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Covenants
Not-to-Compete
|
|
|
Client Lists
|
|
|
Total
|
|
Balance, April 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible assets
|
|
$
|
17,245
|
|
|
$
|
15,760
|
|
|
$
|
33,005
|
|
Less accumulated amortization
|
|
|
(15,363
|
)
|
|
|
(4,222
|
)
|
|
|
(19,585
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,882
|
|
|
$
|
11,538
|
|
|
$
|
13,420
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Covenants
Not-to-Compete
|
|
|
Client Lists
|
|
|
Total
|
|
Balance, April 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible assets
|
|
$
|
17,043
|
|
|
$
|
11,660
|
|
|
$
|
28,703
|
|
Less accumulated amortization
|
|
|
(14,800
|
)
|
|
|
(2,229
|
)
|
|
|
(17,029
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
2,243
|
|
|
$
|
9,431
|
|
|
$
|
11,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible amortization expense for fiscal years 2014, 2013 and 2012 was $2,556, $1,306 and $629, respectively.
The intangible amortization expense estimated as of April 30, 2014 for the five fiscal years following fiscal year 2014 and thereafter is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015
|
|
|
2016
|
|
|
2017
|
|
|
2018
|
|
|
2019
|
|
|
Thereafter
|
|
$
|
2,925
|
|
|
$
|
2,314
|
|
|
$
|
1,874
|
|
|
$
|
1,652
|
|
|
$
|
1,449
|
|
|
$
|
3,206
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
94
8.
|
FINAL CAPPING, CLOSURE AND POST-CLOSURE COSTS
|
Accrued final capping, closure and post-closure costs include the current and non-current portion of costs associated with obligations for
final capping closure and post-closure of our landfills. We estimate our future final capping, closure and post-closure costs in order to determine the final capping, closure and post-closure expense per ton of waste placed into each landfill as
further described in Note 3 to these consolidated financial statements. The anticipated timeframe for paying these costs varies based on the remaining useful life of each landfill, as well as the duration of the post-closure monitoring period. The
changes to accrued final capping, closure and post-closure liabilities for fiscal years 2014 and 2013 are as follows:
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Beginning balance
|
|
$
|
43,170
|
|
|
$
|
39,629
|
|
Obligations incurred
|
|
|
3,621
|
|
|
|
3,188
|
|
Revisions in estimates (1)
|
|
|
(3,728
|
)
|
|
|
(694
|
)
|
Accretion expense
|
|
|
3,967
|
|
|
|
3,538
|
|
Payments
|
|
|
(2,376
|
)
|
|
|
(2,491
|
)
|
|
|
|
|
|
|
|
|
|
Ending balance
|
|
$
|
44,654
|
|
|
$
|
43,170
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The revisions in estimates for final capping, closure and post-closure for fiscal years 2014 and 2013 consist of changes in cost estimates and the timing of final capping and closure events, as well as changes to
expansion airspace and tonnage placement assumptions.
|
9.
|
OTHER ACCRUED LIABILITIES
|
Other accrued liabilities, classified as current liabilities, as of April 30, 2014 and 2013 consist of the following:
|
|
|
|
|
|
|
|
|
|
|
April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Maine Energy remediation reserve
|
|
$
|
2,932
|
|
|
$
|
4,500
|
|
Other accrued liabilities
|
|
|
14,680
|
|
|
|
16,514
|
|
|
|
|
|
|
|
|
|
|
Total other accrued liabilities
|
|
$
|
17,612
|
|
|
$
|
21,014
|
|
|
|
|
|
|
|
|
|
|
95
10.
|
LONG-TERM DEBT AND CAPITAL LEASES
|
Long-term debt and capital leases as of April 30, 2014 and 2013 consist of the following:
|
|
|
|
|
|
|
|
|
|
|
April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Senior subordinated notes due February 15, 2019, bearing interest at 7.75%, interest payable semiannually, unsecured and
unconditionally guaranteed (including unamortized discount of $1,491 and $1,735)
|
|
$
|
323,509
|
|
|
$
|
323,265
|
|
|
|
|
Senior secured revolving credit facility, which provides for advances or letters of credit of up to $227,500, due March 18, 2016,
bearing interest at LIBOR plus 3.75%, (approximately 3.90% at April 30, 2014 based on one month LIBOR), secured by substantially all of our assets
|
|
|
133,860
|
|
|
|
123,200
|
|
|
|
|
Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-1 due January 1, 2025, dated December 1,
2005, bearing interest at BMA Index (approximately 0.18% at April 30, 2014) enhanced by an irrevocable, transferable direct-pay letter of credit (3.875% at April 30, 2014)
|
|
|
3,600
|
|
|
|
3,600
|
|
|
|
|
Finance authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-2 due January 1, 2025, dated February 1,
2012, bearing interest at 6.25% through January 31, 2017, unsecured and guaranteed by our significant wholly-owned subsidiaries
|
|
|
21,400
|
|
|
|
21,400
|
|
|
|
|
Vermont Economic Development Authority Solid Waste Disposal Long-Term Revenue Bonds Series 2013 due April 1, 2036, dated
March 1, 2013, bearing interest at 4.75% through April 4, 2019, unsecured and guaranteed by our significant wholly-owned subsidiaries
|
|
|
16,000
|
|
|
|
16,000
|
|
|
|
|
Business Finance Authority of the State of New Hampshire Solid Waste Disposal Revenue Bonds Series 2013 due April 1, 2029,
dated March 1, 2013, bearing interest at BMA Index (approximately 0.18% at April 30, 2014) enhanced by an irrevocable, transferable direct-pay letter of credit (3.875% at April 30, 2014)
|
|
|
5,500
|
|
|
|
5,500
|
|
|
|
|
Notes payable, bearing interest at rates of up to 6.00%, due in monthly or annual installments varying to $120, maturing through
April 2017
|
|
|
440
|
|
|
|
1,228
|
|
|
|
|
Capital leases for facilities and equipment, bearing interest at rates of up to 7.70%, due in monthly or annual installments varying to
$935, maturing through April 2023
|
|
|
3,710
|
|
|
|
2,012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
508,019
|
|
|
|
496,205
|
|
Less current maturities
|
|
|
885
|
|
|
|
1,218
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
507,134
|
|
|
$
|
494,987
|
|
|
|
|
|
|
|
|
|
|
Senior Secured Revolving Credit Facility
The senior secured revolving credit facility (2011 Revolver) is a $227,500 component of our revolving credit and letter of credit facility due
March 18, 2016 (Senior Credit Facility). We have the right to request, at our discretion, an increase in the amount of the Senior Credit Facility by an aggregate amount of $100,000, subject to certain conditions set forth in the
Senior Credit Facility agreement. The Senior Credit Facility is guaranteed jointly and severally, fully and unconditionally by all of our significant wholly-owned subsidiaries. We entered into a second amendment and consent under our Senior Credit
Facility on September 20, 2012. The amendment provided us the ability to redeem our Second Lien Notes and adjusted our financial covenants.
The
Senior Credit Facility, as amended, is subject to customary affirmative, negative and financial covenants. We entered into a third amendment under our Senior Credit Facility on June 25, 2013 to further adjust our
96
financial covenants. The amendment loosened our minimum interest coverage ratio and our maximum consolidated total funded debt to consolidated EBITDA ratio and tightened our maximum senior funded
debt to consolidated EBITDA ratio and maximum allowed capital expenditures. As of April 30, 2014, these covenants restrict capital expenditures to 1.1 times our consolidated depreciation expense, depletion expense and landfill amortization
expense, set a minimum interest coverage ratio of 2.25, a maximum consolidated total funded debt to consolidated EBITDA ratio of 5.85 and a maximum senior funded debt to consolidated EBITDA ratio of 2.50.
In addition to the financial covenants described above, the Senior Credit Facility, as amended, also contains a number of important negative covenants which
restrict, among other things, our ability to sell assets, pay dividends, invest in non-wholly owned entities, repurchase stock, incur debt, grant liens and issue preferred stock. As of April 30, 2014, we were in compliance with all covenants
under the indenture governing the Senior Credit Facility and we do not believe that these restrictions impact our ability to meet future liquidity needs except that they may impact our ability to increase our investments in non-wholly owned
entities, including the joint ventures to which we are already party.
Further advances were available under the 2011 Revolver in the amount of $58,922 as
of April 30, 2014. The available amount is net of outstanding irrevocable letters of credit totaling $34,718 as of April 30, 2014, at which date no amount had been drawn.
Senior Subordinated Notes
In fiscal year 2012, we
completed the offering of $200,000 of senior subordinated notes due February 15, 2019 (2019 Notes). The net proceeds from the 2019 Notes, together with other available funds, were used to refinance our then outstanding senior
subordinated notes due February 1, 2013 (2013 Notes) and to pay related transaction costs.
In fiscal year 2013, we completed the
offering of an additional $125,000 of 2019 Notes. The 2019 Notes were issued at a discount of $1,863, which is amortized to interest expense over the life of the 2019 Notes. The net proceeds from the offering of additional 2019 Notes, along with
$50,000 of 2011 Revolver borrowings, $42,184 of net equity proceeds from the offering and sale of Class A common stock and other available funds were used to redeem our Second Lien Notes in full and to pay related transaction costs.
As of April 30, 2014, we had outstanding $325,000 aggregate principal amount of the 2019 Notes, which will mature on February 15, 2019. The 2019
Notes accrue interest at the rate of 7.75% per annum and interest is payable semiannually in arrears on February 15 and August 15 of each year.
The indenture governing the 2019 Notes contains certain negative covenants which restrict, among other things, our ability to sell assets, make investments in
joint ventures, pay dividends, repurchase stock, incur debt, grant liens and issue preferred stock. As of April 30, 2014, we were in compliance with all covenants under the indenture governing the 2019 Notes and we do not believe that these
restrictions impact our ability to meet future liquidity needs except that they may impact our ability to increase our investments in non-wholly owned entities, including the joint ventures to which we are already party.
The 2019 Notes are fully and unconditionally guaranteed on a senior subordinated basis by substantially all of our existing and future domestic restricted
subsidiaries that guarantee our Senior Credit Facility.
Tax-Exempt Financings
Maine Bonds
As of April 30, 2014, we had
outstanding $21,400 aggregate principal amount of the Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005R-2 (FAME Bonds 2005R-2). The FAME Bonds 2005R-2, which are guaranteed by certain of our subsidiaries,
accrue interest at 6.25% per annum through January 31, 2017, at which time they may be converted from a fixed to a variable rate. The FAME Bonds 2005R-2 mature on January 1, 2025.
97
As of April 30, 2014, we had outstanding $3,600 aggregate principal amount of the Finance Authority of Maine
Solid Waste Disposal Revenue Bonds Series 2005R-1 (FAME Bonds 2005R-1). The FAME Bonds 2005R-1 are variable rate bonds secured by a letter of credit issued by our administrative agent bank. The FAME Bonds 2005R-1 mature on
January 1, 2025.
We borrowed the proceeds of the FAME Bonds 2005R-1 and 2005R-2 to pay for certain costs relating to landfill development and
construction, vehicle, container and related equipment acquisition for solid waste collection and transportation services, improvements to existing solid waste disposal, hauling, transfer station and other facilities, other infrastructure
improvements, and machinery and equipment for solid waste disposal operations owned and operated by us, or a related party, all located in Maine.
Vermont Bonds
In the fourth quarter of fiscal
year 2013, we completed a financing transaction involving the issuance, by the Vermont Economic Development Authority, of $16,000 aggregate principal amount of its Solid Waste Disposal Long-Term Revenue Bonds Series 2013 (Vermont
Bonds). The Vermont Bonds were issued pursuant to an indenture, dated as of March 1, 2013. We borrowed the proceeds of the Vermont Bonds to repay borrowings under our 2011 Revolver for qualifying property, plant and equipment assets
purchased in Vermont since October 5, 2011. The Vermont Bonds, which are guaranteed by certain of our subsidiaries, accrue interest at 4.75% per annum through April 4, 2019, at which time they may be converted from a fixed rate to a
variable rate. The Vermont Bonds mature on April 1, 2036.
New Hampshire Bonds
In the fourth quarter of fiscal year 2013, we completed a financing transaction involving the issuance, by the Business Finance Authority of the State of New
Hampshire, of $5,500 aggregate principal amount of its Solid Waste Disposal Revenue Bonds Series 2013 (New Hampshire Bonds). The New Hampshire Bonds were issued pursuant to an indenture, dated as of March 1, 2013. We borrowed
the proceeds of the New Hampshire Bonds to repay borrowings under our 2011 Revolver for qualifying property, plant and equipment assets purchased in New Hampshire since October 5, 2011. The New Hampshire Bonds are variable rate bonds secured by
a letter of credit issued by our administrative agent bank. The New Hampshire Bonds also contain a drawdown structure that allows us to issue up to an additional $5,500 of bonds at a future date. The New Hampshire Bonds mature on April 1, 2029.
Loss on Debt Extinguishment
In fiscal year 2013, we
recorded a charge of $15,584 as a loss on debt extinguishment related to the full refinancing of the Second Lien Notes. The loss on debt extinguishment consisted of a $2,767 non-cash write off of deferred financing costs, a $2,074 non-cash write off
of the unamortized original issue discount and a $10,743 charge associated with the early tender premium and tender fees associated with the redemption of the Second Lien Notes.
In fiscal year 2012, we recorded a charge of $300 as a loss on debt extinguishment related to the non-cash write off of unamortized deferred financing costs
associated with the original issuance of $25,000 Finance Authority of Maine Solid Waste Disposal Revenue Bonds Series 2005 following the mandatory tender of $21,400 of the aggregate principal amount then outstanding.
98
Interest Expense
The components of interest expense for fiscal years 2014, 2013 and 2012 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Interest expense on debt and capital lease obligations
|
|
$
|
34,216
|
|
|
$
|
36,955
|
|
|
$
|
40,156
|
|
Amortization of debt financing costs
|
|
|
2,757
|
|
|
|
3,325
|
|
|
|
3,307
|
|
Amortization of debt discounts
|
|
|
243
|
|
|
|
626
|
|
|
|
964
|
|
Letter of credit fees
|
|
|
1,215
|
|
|
|
1,032
|
|
|
|
988
|
|
Less: capitalized interest
|
|
|
(256
|
)
|
|
|
(368
|
)
|
|
|
(407
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest expense
|
|
$
|
38,175
|
|
|
$
|
41,570
|
|
|
$
|
45,008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value of Debt
As of
April 30, 2014, the fair value of our fixed rate debt, including our 2019 Notes, FAME Bonds 2005R-2 and Vermont Bonds, was approximately $375,974 and the carrying value was $362,400. The fair value of the 2019 Notes is considered to be Level 1
within the fair value hierarchy as the fair value is based off of a quoted market price in an active market. The fair value of the FAME Bonds 2005R-2 and the Vermont Bonds are considered to be Level 2 within the fair value hierarchy as the fair
values are determined using a discounted cash flow analysis based on current market rates for similar types of instruments taking into account our credit risk. The valuation methodologies used to calculate fair value of the FAME Bonds 2005R-2 and
the Vermont Bonds changed in the fourth quarter of fiscal year 2014 due to information no longer being made available to us to continue use of the previous valuation methodologies. As of April 30, 2014, the fair value of our 2011 Revolver
approximated its carrying value of $133,860 based on current borrowing rates for similar types of borrowing arrangements, or Level 2 inputs. The carrying value of our remaining material variable rate debt, including the FAME Bonds 2005R-1 and the
New Hampshire Bonds, approximates fair value because interest rates are variable and, accordingly, approximate current market rates for instruments with similar risk and maturities.
Although we have determined the estimated fair value amounts of the FAME Bonds 2005R-2 and Vermont Bonds using available market information and a commonly
accepted valuation methodology, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, our estimates are not necessarily indicative of the amounts that we, or holders of these instruments,
could realize in a current market exchange. The use of different assumptions and/or estimation methodologies could have a material effect on the estimated fair values. These amounts have not been revalued, and current estimates of fair value could
differ significantly from the amounts presented.
Future Maturities of Debt
Aggregate principal maturities of debt and capital leases as of April 30, 2014 are as follows:
|
|
|
|
|
2015
|
|
$
|
885
|
|
2016
|
|
|
135,324
|
|
2017
|
|
|
227
|
|
2018
|
|
|
215
|
|
2019 (1)
|
|
|
323,740
|
|
Thereafter
|
|
|
47,628
|
|
|
|
|
|
|
|
|
$
|
508,019
|
|
|
|
|
|
|
(1)
|
Includes unamortized discount of $1,491 on 2019 Notes.
|
99
11.
|
COMMITMENTS AND CONTINGENCIES
|
Lease Commitments
We lease operating
facilities and equipment in the ordinary course of our business under various operating leases with monthly payments varying up to $26. Future minimum lease payments are recognized on a straight-line basis over the minimum lease term. Total rent
expense under operating leases charged to operations was $5,651, $5,372 and $5,213 in fiscal years 2014, 2013 and 2012, respectively.
Future minimum
lease payments under non-cancellable operating leases as of April 30, 2014 are as follows:
|
|
|
|
|
2015
|
|
$
|
11,279
|
|
2016
|
|
|
10,175
|
|
2017
|
|
|
9,453
|
|
2018
|
|
|
9,678
|
|
2019
|
|
|
11,723
|
|
Thereafter
|
|
|
98,562
|
|
|
|
|
|
|
Total minimum lease payments
|
|
$
|
150,870
|
|
|
|
|
|
|
Legal Proceedings
In the
ordinary course of our business and as a result of the extensive governmental regulation of the solid waste industry, we are subject to various judicial and administrative proceedings involving state and local agencies. In these proceedings, an
agency may seek to impose fines or to revoke or deny renewal of an operating permit held by us. From time to time, we may also be subject to actions brought by special interest or other groups, adjacent landowners or residents in connection with the
permitting and licensing of landfills and transfer stations, or alleging environmental damage or violations of the permits and licenses pursuant to which we operate. In addition, we have been named defendants in various claims and suits pending for
alleged damages to persons and property, alleged violations of certain laws and alleged liabilities arising out of matters occurring during the ordinary operation of the waste management business.
In accordance with FASB ASC 450-20, we accrue for legal proceedings when losses become probable and reasonably estimable. As of the end of each applicable
reporting period, we review each of our legal proceedings to determine whether it is probable, reasonably possible or remote that a liability has been incurred and, if it is at least reasonably possible, whether a range of loss can be reasonably
estimated under the provisions of FASB ASC 450-20. In instances where we determine that a loss is probable and we can reasonably estimate a range of loss we may incur with respect to such a matter, we record an accrual for the amount within the
range that constitutes our best estimate of the possible loss. If we are able to reasonably estimate a range, but no amount within the range appears to be a better estimate than any other, we record an accrual in the amount that is the low end of
such range. When a loss is reasonably possible, but not probable, we will not record an accrual, but we will disclose our estimate of the possible range of loss where such estimate can be made in accordance with ASC 450-20.
Environmental Remediation Liability
We are
subject to liability for environmental damage, including personal injury and property damage, that our solid waste, recycling and power generation facilities may cause to neighboring property owners, particularly as a result of the contamination of
drinking water sources or soil, possibly including damage resulting from conditions existing before we acquired the facilities. We may also be subject to liability for similar claims arising from off-site environmental contamination caused by
pollutants or hazardous substances if we or our predecessors arrange or arranged to transport, treat or dispose of those materials. The following matters represent our potential or outstanding material claims.
100
Potsdam Environmental Remediation Liability
On December 20, 2000, the State of New York Department of Environmental Conservation (DEC) issued an Order on Consent (Order)
which named Waste-Stream, Inc. (WSI), our subsidiary, General Motors Corporation (GM) and Niagara Mohawk Power Corporation (NiMo) as Respondents. The Order required that the Respondents undertake certain work
on a 25-acre scrap yard and solid waste transfer station owned by WSI, including the preparation of a Remedial Investigation and Feasibility Study (Study). A draft of the Study was submitted to the DEC in January 2009 (followed by a
final report in May 2009). The Study estimated that the undiscounted costs associated with implementing the preferred remedies would be approximately $10,219. On February 28, 2011, the DEC issued a Proposed Remedial Action Plan for the
site and accepted public comments on the proposed remedy through March 29, 2011. We submitted comments to the DEC on this matter. In April 2011, the DEC issued the final Record of Decision (ROD) for the site. The ROD was
subsequently rescinded by the DEC for failure to respond to all submitted comments. The preliminary ROD, however, estimated that the present cost associated with implementing the preferred remedies would be approximately $12,130. The DEC issued the
final ROD in June 2011 with proposed remedies consistent with its earlier ROD. An Order on Consent and Administrative Settlement naming WSI and NiMo as Respondents was executed by the Respondents and the DEC with an effective date of
October 25, 2013. It is unlikely that any costs relating to onsite remediation will be incurred until fiscal year 2016.
WSI is jointly and severally
liable for the total cost to remediate and we initially expected to be responsible for approximately 30% of such costs pursuant to a cost-sharing agreement with NiMo and GM. Based on these estimates, we recorded an environmental remediation charge
of $2,823 in the third quarter of fiscal year 2009. In the fourth quarter of fiscal year 2009, we recognized an additional charge of $1,532, representing an additional 15% of the estimated costs, in recognition of the deteriorating financial
condition and eventual bankruptcy filing of GM. In the fourth quarter of fiscal year 2010, we recognized an additional charge of $335 based on changes in the expected timing of cash outflows. Based on the estimated costs in the ROD, and changes in
the estimated timing of cash flows, we recorded an environmental remediation charge of $549 in the fourth quarter of fiscal year 2011. Such charges could be significantly higher if costs exceed estimates. We inflate these estimated costs in current
dollars until the expected time of payment and discount the total cost to present value using a risk free interest rate of 2.0%. As of April 30, 2014 and 2013, we have recorded liabilities of $5,320 and $5,297, including the recognition of $19
and $138 of accretion expense in fiscal years 2014 and 2013, respectively.
In September 2011, the DEC settled its environmental claim against the
estate of the former GM (known as Motors Liquidation Trust) for future remediation costs relating to the WSI site for face value of $3,000. In addition, in November 2011 we settled our own claim against the Motors Liquidation Trust
for face value of $100. These claims will be paid by GM in warrants to obtain stock of the reorganized GM. We began receiving the warrants in May 2013 and at this time there is no way to accurately estimate when the remainder of these claims will be
paid. We have not assumed that any future proceeds from the sale of securities received in payment of these claims will reduce our exposure.
Southbridge Landfill Environmental Remediation Liability
On or about August 24, 2013, we experienced the movement of stockpiled earth at our Southbridge landfill in Southbridge, Massachusetts. The stockpiled
materials consisted of soil removed and relocated to create space for the construction of additional landfill airspace at our Southbridge landfill. The earth had been relocated and stored during the fall, winter and spring construction season of
fiscal year 2013.
The movement caused some of the stockpiled earth to enter wetlands on property owned by us. On or about August 29, 2013, we
notified the Massachusetts Department of Environmental Protection (MADEP), and the Towns of Southbridge and Charlton, Massachusetts, of the occurrence of the movement. On or about September 6, 2013, MADEP issued a Unilateral
Administrative Order (UAO) requiring us to provide MADEP with a plan to remove any materials deposited in the wetlands as a result of the movement (Plan). On
101
or about October 3, 2013, we submitted the Plan to MADEP, and on or about October 15, 2013, MADEP approved the Plan and verbally issued permission for us to implement the Plan. We are
currently implementing the Plan under the supervision of MADEP.
In January 2014, we received correspondence from the Massachusetts Office of the
Attorney General (MAAG), advising us that the MAAG intends to schedule a meeting with us to discuss this incident, and to possibly file suit against us for violation of the Massachusetts Wetlands Protection, Clean Air and Solid Waste
Acts. We met with the MAAG in March 2014 to discuss our ongoing remediation effort and the parties have initiated discussions regarding the resolution of this matter.
We anticipate that execution of the Plan and related matters will involve remediation costs of $2,100 and such costs could be higher if actual costs exceed
estimates. We have provided our insurer with notice of the Plan, and the costs expended by us to date to comply with the Plan. We have also provided notice to certain of our contractors and technical advisors that the movement has occurred, that
significant remediation costs will be incurred in executing the Plan and related matters, and that we expect our contractors and technical advisors to assist in the execution of the Plan and related matters, to share in the remediation costs as
responsible parties, and to provide notice to their own insurers. We believe that a loss in the range of $400 to $2,100, after taking into account amounts we expect to be reimbursed by our insurer and other third-parties, is probable and have
therefore recorded a charge of $400 in fiscal year 2014 as an environmental remediation charge.
On or about April 25, 2014, we notified MADEP and
other interested parties that areas of sloughing had occurred in a plateau created as part of new cell construction at our Southbridge landfill. Some of the same contractors and technical advisors that were involved in the initial movement of
stockpiled earth are also involved in the new cell construction that includes this area of sloughing. We repaired the areas of sloughing on April 25, 2014 and no damage occurred in the abutting wetlands. On May 9, 2014, MADEP issued a UAO
directing us to ensure that the areas of sloughing at the plateau were repaired and to take steps to ensure that there would be no incursion into the wetlands, and requiring that we undertake corrective actions to ensure the stability of the
plateau. Prior to MADEPs issuance of the latest UAO, we were in the process of awarding a contract to a soil remediation company to undertake and ensure such stability at the plateau. We needed MADEP to issue permits in order for this work to
be finalized. We filed a written notice of claim for an adjudicatory hearing with respect to the efficacy of MADEPs issuance of the latest UAO, but the parties have reached a tentative resolution of the issues raised by MADEPs issuance
of the latest UAO, and the parties are finalizing a Stipulation that will include the withdrawal by us of our notice of claim for an adjudicatory hearing.
The total expected environmental remediation payments, in todays dollars, for each of the five succeeding fiscal years and the aggregate amount
thereafter are as follows:
|
|
|
|
|
2015
|
|
$
|
45
|
|
2016
|
|
|
3,399
|
|
2017
|
|
|
1,029
|
|
2018
|
|
|
27
|
|
2019
|
|
|
42
|
|
Thereafter
|
|
|
750
|
|
|
|
|
|
|
Total
|
|
$
|
5,292
|
|
|
|
|
|
|
102
A reconciliation of the expected aggregate uninflated, undiscounted environmental remediation liability to the
amount recognized in the statement of financial position as of April 30, 2014 is as follows:
|
|
|
|
|
Undiscounted liability
|
|
$
|
5,292
|
|
Plus inflation / (discount)
|
|
|
28
|
|
|
|
|
|
|
Liability balance April 30, 2014
|
|
$
|
5,320
|
|
|
|
|
|
|
Any substantial liability incurred by us arising from environmental damage could have a material adverse effect on our
business, financial condition and results of operations. We are not presently aware of any other situations that would have a material adverse impact on our business, financial condition, results of operations or cash flows.
Employment Contracts
We have entered into employment
contracts with four of our executive officers. Contracts are dated June 18, 2001, March 31, 2006, July 6, 2010 and September 1, 2012. Each contract had an initial term between one and three years and a covenant
not-to-compete ranging from one to two years from the date of termination. These contracts automatically extend for a one year period at the end of the initial term and any renewal period. Total annual commitments for salaries under these contracts
are $1,397. In the event of a change in control of us, or in the event of involuntary termination without cause, the employment contracts provide for a payment ranging from one to three years of salary and bonuses. We also have other employment
contracts or arrangements with employees who are not executive officers.
12.
|
STOCKHOLDERS (DEFICIT) EQUITY
|
Common Stock
The holders of the
Class A common stock are entitled to one vote for each share held. The holders of the Class B common stock are entitled to ten votes for each share held, except for the election of one director, who is elected by the holders of the
Class A common stock exclusively. The Class B common stock is convertible into Class A common stock on a share-for-share basis at the option of the shareholder.
In fiscal year 2013, we sold 11,500 shares of Class A common stock at an average price of $4.00 per share in a registered public offering. The net
proceeds received from the registered public offering, after deducting underwriting discounts, commissions and offering expenses, were $42,184 and were used to refinance our Second Lien Notes.
Preferred Stock
We are authorized to issue up to 944
shares of preferred stock in one or more series. As of April 30, 2014 and 2013, we had no shares issued.
Stock Based Compensation
Stock Incentive Plans
1997 Stock Option
Plan.
In fiscal year 1998, we adopted the 1997 Stock Option Plan (1997 Plan) a stock option plan for employees, officers and directors of, and consultants and advisors to us. The 1997 Plan terminated as of July 31, 2007 and as a
result no additional awards may be made pursuant to the 1997 Plan.
1997 Non-Employee Director Stock Option Plan
.
In fiscal year
1998, we adopted a stock option plan for our non-employee directors. The 1997 Non-Employee Director Stock Option Plan (Non-Employee Director Plan) provided for the issuance of a maximum of 200 shares of Class A common stock pursuant
to the grant of non-statutory options. The Non-Employee Director Plan terminated as of July 31, 2007.
103
2006 Stock Incentive Plan.
In fiscal year 2007, we adopted the 2006 Stock Incentive Plan (2006
Plan). The 2006 Plan was subsequently amended in fiscal year 2010. Up to an aggregate amount equal to the sum of: (i) 2,475 shares of Class A common stock (subject to adjustment in the event of stock splits and other similar events),
plus (ii) such additional number of shares of Class A common stock as are currently subject to options granted under our 1993 Incentive Stock Option Plan, 1994 Non-statutory Stock Option Plan, 1996 Option Plan, and 1997 Plan (Prior
Plans) which are not actually issued under the Prior Plans because such options expire or otherwise result in shares not being issued, may be issued pursuant to awards granted under the 2006 Plan. As of April 30, 2014, there were 1,414
Class A common stock equivalents available for future grant under the 2006 Plan, inclusive of additional Class A common stock equivalents which were previously issued under our terminated plans and have since become available for grant
because such awards expired or otherwise resulted in shares not being issued.
Options granted under the 2006 Plan are granted at a price equal to the
prevailing fair market value of our Class A common stock at the date of grant. Generally, options granted have a term not to exceed ten years and vest over a one to four year period from the date of grant.
We grant restricted stock awards, restricted stock units and performance stock units under the 2006 Plan at a price equal to the fair market value of our
Class A common stock at the date of grant. Restricted stock awards granted to non-employee directors vest incrementally over a three year period beginning on the first anniversary of the date of grant. Restricted stock units vest incrementally
over an identified service period beginning on the grant date based on continued employment. Performance stock units vest on April 30 of the third fiscal year-end following the grant date and are based on our attainment of a targeted average
return on net assets as of the vesting date.
Stock Options
The following table summarizes stock option activity for fiscal year 2014.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
|
Weighted
Average
Exercise Price
|
|
|
Weighted
Average
Remaining
Contractual
Term (years)
|
|
|
Aggregate
Intrinsic Value
|
|
Outstanding, April 30, 2013
|
|
|
1,442
|
|
|
$
|
8.48
|
|
|
|
|
|
|
|
|
|
Granted
|
|
|
157
|
|
|
$
|
5.65
|
|
|
|
|
|
|
|
|
|
Exercised
|
|
|
(33
|
)
|
|
$
|
4.30
|
|
|
|
|
|
|
|
|
|
Forfeited
|
|
|
(198
|
)
|
|
$
|
7.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding, April 30, 2014
|
|
|
1,368
|
|
|
$
|
8.65
|
|
|
|
4.8
|
|
|
$
|
543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exercisable, April 30, 2014
|
|
|
1,027
|
|
|
$
|
10.02
|
|
|
|
3.4
|
|
|
$
|
294
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expected to vest, April 30, 2014
|
|
|
1,368
|
|
|
$
|
8.65
|
|
|
|
4.8
|
|
|
$
|
543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During fiscal years 2014, 2013 and 2012, stock-based compensation expense for stock options was $464, $528, and $258,
respectively.
During fiscal years 2014, 2013 and 2012, the aggregate intrinsic value of stock options exercised was $23.
As of April 30, 2014, total unrecognized stock-based compensation expense related to outstanding stock options was $754, which will be recognized over a
weighted average period of 1.8 years.
104
Our calculation of stock-based compensation expense associated with stock options granted in fiscal years 2014,
2013 and 2012 was made using the Black-Scholes valuation model. The weighted average fair value of stock options granted during fiscal years 2014, 2013 and 2012 were $4.22, $3.03 and $4.14 per option, respectively, which were calculated assuming no
expected dividend yield using the following weighted average assumptions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Expected life
|
|
|
6.79 years
|
|
|
|
6.82 years
|
|
|
|
5.50 years
|
|
Risk-free interest rate
|
|
|
2.22
|
%
|
|
|
1.14
|
%
|
|
|
0.82
|
%
|
Expected volatility
|
|
|
83.96
|
%
|
|
|
84.40
|
%
|
|
|
91.54
|
%
|
Expected life is calculated based on the weighted average historical life of the vested stock options, giving consideration to
vesting schedules and historical exercise patterns. Risk-free interest rate is based on the U.S. Treasury yield curve for the period of the expected life of the stock option. Expected volatility is calculated using the weekly historical volatility
of our Class A common stock over the expected life.
The Black-Scholes valuation model requires extensive use of accounting judgment and financial
estimation, including estimates of the expected term option holders will retain their vested stock options before exercising them, the estimated volatility of our Class A common stock price over the expected term and the number of stock options
that will be forfeited prior to the completion of their vesting requirements. Application of alternative assumptions could produce significantly different estimates of the fair value of stock-based compensation and consequently, the related amounts
recognized in the unaudited consolidated statements of operations.
Other Stock Awards
The following table summarizes restricted stock, restricted stock unit and performance stock unit activity for fiscal year 2014.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted Stock,
Restricted Stock Units,
and Performance Stock
Units (1)
|
|
|
Weighted
Average
Grant Price
|
|
|
Weighted Average
Remaining
Contractual Term
(years)
|
|
|
Aggregate Intrinsic
Value
|
|
Outstanding, April 30, 2013
|
|
|
1,088
|
|
|
$
|
5.28
|
|
|
|
|
|
|
|
|
|
Granted
|
|
|
542
|
|
|
$
|
4.28
|
|
|
|
|
|
|
|
|
|
Class A Common Stock Vested
|
|
|
(327
|
)
|
|
$
|
4.89
|
|
|
|
|
|
|
|
|
|
Forfeited
|
|
|
(226
|
)
|
|
$
|
5.86
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding, April 30, 2014
|
|
|
1,077
|
|
|
$
|
4.77
|
|
|
|
1.5
|
|
|
$
|
500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expected to vest, April 30, 2014
|
|
|
947
|
|
|
$
|
4.82
|
|
|
|
1.5
|
|
|
$
|
409
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Performance stock units are included at the 100% attainment level. Attainment of maximum annual returns on net assets could result in the issuance of an additional 255 shares of Class A common stock.
|
105
The following table summarizes the grant activity for other stock awards for fiscal years 2014, 2013 and 2012,
respectively:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Granted
|
|
|
Weighted
Average
Grant Date
Fair Value
|
|
|
Unissued
at April
30, 2014
|
|
Fiscal year 2012 grants
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted stock units
|
|
|
305
|
|
|
$
|
6.12
|
|
|
|
62
|
|
Performance stock units
|
|
|
255
|
|
|
$
|
6.06
|
|
|
|
|
|
Restricted stock awards
|
|
|
51
|
|
|
$
|
5.83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
611
|
|
|
|
|
|
|
|
62
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal year 2013 grants
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted stock units
|
|
|
340
|
|
|
$
|
5.15
|
|
|
|
176
|
|
Performance stock units
|
|
|
316
|
|
|
$
|
5.17
|
|
|
|
255
|
|
Restricted stock awards
|
|
|
79
|
|
|
$
|
4.45
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
735
|
|
|
|
|
|
|
|
431
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal year 2014 grants
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted stock units
|
|
|
482
|
|
|
$
|
4.09
|
|
|
|
454
|
|
Restricted stock awards
|
|
|
60
|
|
|
$
|
5.81
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
542
|
|
|
|
|
|
|
|
454
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
During fiscal years 2014, 2013 and 2012, stock-based compensation expense related to restricted stock, restricted stock units
and performance stock units was $1,861, $1,609 and $1,485, respectively. There was no tax benefit in the provision for income taxes associated with stock-based compensation expense for fiscal years 2014, 2013 and 2012, respectively.
During fiscal years 2014, 2013 and 2012, the total fair value of other stock awards vested was $1,458, $2,475 and $2,056, respectively.
As of April 30, 2014, total unrecognized stock-based compensation expense related to restricted stock and restricted stock units was $2,044, which will
be recognized over a weighted average period of 1.6 years. Maximum unrecognized stock-based compensation expense as of April 30, 2014 related to outstanding performance stock units, and subject to the attainment of targeted maximum annual
returns on net assets, was $2,390 to be recognized over a weighted average period of 1.0 years. We do not expect to recognize any stock-based compensation expense as of April 30, 2014 related to our outstanding performance stock units based on
our expected attainment levels.
We recorded a tax benefit of $0, $96 and $254 to additional paid-in-capital related to the exercise of various share
based awards in fiscal years 2014, 2013 and 2012, respectively. Tax savings from stock-based compensation resulting from tax deductions in excess of expense are reflected as a financing cash flow in our consolidated financial statements.
We also recorded $79, $99 and $113 of stock-based compensation expense related to our Employee Stock Purchase Plan during fiscal years 2014, 2013 and 2012,
respectively.
Noncontrolling interests
Casella-Altela Regional Environmental Services, LLC (CARES) is a joint venture that owns and operates a water and leachate treatment facility for
the natural gas drilling industry in Pennsylvania. Our joint venture partner in CARES is Altela, Inc. As of April 30, 2014, our ownership interest in CARES was 51%, compared to
106
49% for Altela, Inc. In accordance with ASC 810-10-15, we consolidate the assets, liabilities and results of operations of CARES into our consolidated financial statements due to our controlling
financial interest in the joint venture.
In fiscal year 2014, we determined that certain water treatment assets (Equipment) of CARES were no
longer operational or were not operating within product performance parameters. In April 2014, we initiated a plan to abandon and shut down the operations of CARES. See Note 16 for disclosure over the asset impairment charge associated with CARES.
Accumulated Other Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) is a component of stockholders (deficit) equity included in the accompanying consolidated balance sheets
and includes, as applicable, the effective portion of changes in the fair value of our cash flow hedges that consist of commodity hedges and interest rate swaps, the changes in fair value of our marketable securities, as well as our portion of the
changes in the fair value of GreenFibers commodity hedges.
The changes in the balances of each component of accumulated other comprehensive income
(loss) for fiscal years 2014, 2013 and 2012 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketable
Securities
|
|
|
Commodity
Hedges
|
|
|
Interest
Rate Swaps
|
|
|
Total
|
|
Balance as of April 30, 2011
|
|
$
|
8
|
|
|
$
|
370
|
|
|
$
|
|
|
|
$
|
378
|
|
Other comprehensive (loss) income before reclassifications
|
|
|
(4
|
)
|
|
|
621
|
|
|
|
(2,369
|
)
|
|
|
(1,752
|
)
|
Amounts reclassified from accumulated other comprehensive income
|
|
|
|
|
|
|
(578
|
)
|
|
|
|
|
|
|
(578
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net current-period other comprehensive (loss) income
|
|
|
(4
|
)
|
|
|
43
|
|
|
|
(2,369
|
)
|
|
|
(2,330
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of April 30, 2012
|
|
|
4
|
|
|
|
413
|
|
|
|
(2,369
|
)
|
|
|
(1,952
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
|
23
|
|
|
|
(1,653
|
)
|
|
|
(1,257
|
)
|
|
|
(2,887
|
)
|
Amounts reclassified from accumulated other comprehensive loss
|
|
|
|
|
|
|
621
|
|
|
|
3,626
|
|
|
|
4,247
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net current-period other comprehensive income (loss)
|
|
|
23
|
|
|
|
(1,032
|
)
|
|
|
2,369
|
|
|
|
1,360
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of April 30, 2013
|
|
|
27
|
|
|
|
(619
|
)
|
|
|
|
|
|
|
(592
|
)
|
Other comprehensive income (loss) before reclassifications
|
|
|
12
|
|
|
|
(36
|
)
|
|
|
|
|
|
|
(24
|
)
|
Amounts reclassified from accumulated other comprehensive loss
|
|
|
|
|
|
|
655
|
|
|
|
|
|
|
|
655
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net current-period other comprehensive income
|
|
|
12
|
|
|
|
619
|
|
|
|
|
|
|
|
631
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of April 30, 2014
|
|
$
|
39
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
107
A summary of reclassifications out of accumulated other comprehensive income (loss) for fiscal year 2014, 2013
and 2012 is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended
April 30,
|
|
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|
|
Details about Accumulated Other
Comprehensive Income (Loss) Components
|
|
Amount Reclassified Out of
Accumulated Other
Comprehensive Income (Loss)
|
|
|
Affected Line Item in the Consolidated
Statements of
Operations
|
Loss on derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comodity Hedges
|
|
$
|
|
|
|
$
|
|
|
|
$
|
130
|
|
|
Revenues
|
GreenFiber Commodity hedges
|
|
|
(405
|
)
|
|
|
(621
|
)
|
|
|
547
|
|
|
Loss from equity method investments
|
Interest rate contracts
|
|
|
|
|
|
|
(3,626
|
)
|
|
|
|
|
|
Loss on derivative instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(405
|
)
|
|
|
(4,247
|
)
|
|
|
677
|
|
|
Loss from continuing operations before income taxes and discontinued operations
|
|
|
|
(250
|
)
|
|
|
|
|
|
|
(99
|
)
|
|
Provision (benefit) for income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(655
|
)
|
|
$
|
(4,247
|
)
|
|
$
|
578
|
|
|
Loss from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13.
|
FAIR VALUE OF FINANCIAL INSTRUMENTS
|
We use a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as
well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. These tiers include: Level 1, defined as quoted market prices in active markets for identical assets or liabilities;
Level 2, defined as inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, and Level 3, defined as unobservable inputs that are not corroborated by market data.
We use valuation techniques that maximize the use of market prices and observable inputs and minimize the use of unobservable inputs. In measuring the fair
value of our financial assets and liabilities, we rely on market data or assumptions which we believe market participants would use in pricing an asset or a liability.
Our financial instruments include cash and cash equivalents, accounts receivable-trade, restricted trust and escrow accounts, interest rate derivatives, trade
payables and long-term debt. The carrying values of cash and cash equivalents, restricted cash, trade receivables and trade payables approximate their respective fair values. See Note 10 for disclosure over the fair value of debt.
As of April 30, 2014, our financial assets and liabilities that are measured at fair value on a recurring basis include the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurement at April 30, 2014 Using:
|
|
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
|
Significant
Unobservable Inputs
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted assets
|
|
$
|
681
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
|
$
|
|
|
|
$
|
2,770
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
108
As of April 30, 2013, our financial assets and liabilities that are measured at fair value on a recurring
basis include the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurement at April 30, 2013 Using:
|
|
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
|
Significant
Unobservable Inputs
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restricted assets
|
|
$
|
545
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate derivatives
|
|
$
|
|
|
|
$
|
4,229
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of April 30, 2014, our assets and liabilities that are measured at fair value on a non-recurring basis include the
following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurement at April 30, 2014 Using:
|
|
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
|
Significant
Unobservable Inputs
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset group CARES
|
|
$
|
|
|
|
$
|
|
|
|
$
|
650
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of April 30, 2014, our financial assets and liabilities recorded at fair value on a non-recurring basis include our
assets related to CARES, a joint venture that owns and operates a water and leachate treatment facility for the natural gas drilling industry in Pennsylvania. The fair value of our remaining CARES asset group was measured using an
in-exchange
valuation premise under the market approach derived from quoted prices of similar assets, adjusted based on qualitative factors specific to the asset.
As of April 30, 2013, our assets and liabilities that are measured at fair value on a non-recurring basis include the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurement at April 30, 2013 Using:
|
|
|
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
|
Significant Other
Observable Inputs
(Level 2)
|
|
|
Significant
Unobservable Inputs
(Level 3)
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset group held-for-sale
Bio Fuels
|
|
$
|
|
|
|
$
|
|
|
|
$
|
61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Guaranty
|
|
$
|
|
|
|
$
|
|
|
|
$
|
2,073
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of April 30, 2013, our financial assets and liabilities recorded at fair value on a non-recurring basis include our
guaranty of GreenFibers modified and restated loan and security agreement and our assets related to BioFuels, a construction and demolition material processing facility located in Lewiston, Maine, which was classified as held-for-sale as of
April 30, 2013. The fair value of our guaranty was determined based on the value of the contribution required to satisfy the guaranty and pay off the term loan in May 2013. The fair value of our BioFuels asset group was measured based on the
asset groups highest and best use using an in-exchange valuation premise under the market approach, utilizing the estimated purchase consideration of the asset group and consideration of costs to be incurred to sell.
109
14.
|
EMPLOYEE BENEFIT PLANS
|
Defined Contribution Plan
We offer our
eligible employees the opportunity to contribute to a 401(k) plan (401(k) Plan). Under the provisions of the 401(k) Plan participants may direct us to defer a portion of their compensation to the 401(k) Plan, subject to
Internal Revenue Code limitations. We provide an employer matching contribution equal to fifty cents for every dollar an employee invests in the 401(k) Plan up to our maximum match of one thousand dollars per calendar year, subject to revision.
Participants vest in employer contributions ratably over a three year period. Employer contributions for fiscal years 2014, 2013, and 2012 amounted to $784, $645 and $603, respectively.
Employee Stock Purchase Plan
In fiscal year 1998,
we implemented our employee stock purchase plan. Under this plan, qualified employees may purchase shares of Class A common stock by payroll deduction at a 15% discount from the market price. 900 shares of Class A common stock have been
reserved for this purpose. During fiscal years 2014, 2013 and 2012, 70, 76 and 65 shares, respectively, of Class A common stock were issued under this plan. As of April 30, 2014, 113 shares of Class A common stock were available for
distribution under this plan.
The provision (benefit) for income taxes from continuing operations for fiscal years 2014, 2013 and 2012 consists of the following:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Federal
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
|
|
$
|
|
|
|
$
|
|
|
|
$
|
121
|
|
Deferred
|
|
|
1,262
|
|
|
|
(2,827
|
)
|
|
|
1,468
|
|
Deferred benefit of loss carryforwards
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,262
|
|
|
|
(2,827
|
)
|
|
|
1,589
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
State
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
|
|
|
219
|
|
|
|
1,040
|
|
|
|
(352
|
)
|
Current benefit of loss carryforwards
|
|
|
|
|
|
|
(22
|
)
|
|
|
|
|
Deferred
|
|
|
318
|
|
|
|
(717
|
)
|
|
|
372
|
|
Deferred benefit of loss carryforwards
|
|
|
|
|
|
|
|
|
|
|
(16
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
537
|
|
|
|
301
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,799
|
|
|
$
|
(2,526
|
)
|
|
$
|
1,593
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Included in the current state tax provision for year ending April 30, 2013 is an $800 settlement with New York State,
comprised of $430 of tax and $370 of interest. New York State had alleged that we were not permitted to file a single combined corporation franchise tax return with our subsidiaries. On January 18, 2011, the State had assessed a liability of
$3,852, comprising $2,220 tax and $1,632 penalties and interest, for tax years ending April 30, 2004 through April 30, 2006. We had filed Petitions of Redetermination with the State of New York Division of Tax Appeals and had been
scheduled for an administrative hearing on April 18-19, 2013. Tax years ending April 30, 2007 through April 30, 2009 were also being audited for the same tax matter. The settlement, which represented less than 8% of the potential
cumulative liability for the years settled, was a monetary settlement without any change to our filing combined returns in New York and it closed years ending April 30, 2004 through April 30, 2010. An audit has been initiated for tax years
2011 through 2013. We had not provided a reserve for the previously settled audit, since we believed that it was more likely than not that we would be
110
successful in contesting the proposed deficiency. We continue to believe that our position related to the 2011-2013 years is appropriate and no reserve has been established for these years.
The differences in the provision (benefit) for income taxes and the amounts determined by applying the Federal statutory rate to income before provision
(benefit) for income taxes for the years ended April 30, 2014, 2013 and 2012 are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Federal statutory rate
|
|
|
35
|
%
|
|
|
35
|
%
|
|
|
35
|
%
|
Tax at statutory rate
|
|
$
|
(8,929
|
)
|
|
$
|
(18,378
|
)
|
|
$
|
(26,638
|
)
|
State income taxes, net of federal benefit
|
|
|
(1,271
|
)
|
|
|
(1,076
|
)
|
|
|
(3,050
|
)
|
Decrease in valuation allowance due to BBI acquisition
|
|
|
|
|
|
|
(5,084
|
)
|
|
|
|
|
Other increase (decrease) in valuation allowance
|
|
|
13,605
|
|
|
|
22,510
|
|
|
|
27,247
|
|
Tax over book basis in GreenFiber on sale
|
|
|
(2,570
|
)
|
|
|
|
|
|
|
|
|
Non-deductible impairment of investment in GreenFiber
|
|
|
|
|
|
|
|
|
|
|
3,738
|
|
Non-deductible GreenFiber goodwill impairment and equity income in subsidiaries
|
|
|
1,548
|
|
|
|
180
|
|
|
|
1,182
|
|
Tax credits
|
|
|
(598
|
)
|
|
|
(660
|
)
|
|
|
(650
|
)
|
Non-deductible expenses
|
|
|
505
|
|
|
|
494
|
|
|
|
823
|
|
Non-deductible stock option charges
|
|
|
|
|
|
|
|
|
|
|
73
|
|
Other, net
|
|
|
(491
|
)
|
|
|
(512
|
)
|
|
|
(1,132
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,799
|
|
|
$
|
(2,526
|
)
|
|
$
|
1,593
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred income taxes reflect the impact of temporary differences between the amounts of assets and liabilities recognized for
financial reporting purposes and such amounts recognized for income tax purposes. Deferred tax assets and liabilities consist of the following at April 30, 2014 and 2013:
|
|
|
|
|
|
|
|
|
|
|
April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Deferred tax assets:
|
|
|
|
|
|
|
|
|
Net operating loss carryforwards
|
|
$
|
36,594
|
|
|
$
|
34,217
|
|
Accrued expenses and reserves
|
|
|
30,690
|
|
|
|
29,884
|
|
Book over tax depreciation of property and equipment
|
|
|
28,868
|
|
|
|
19,881
|
|
Alternative minimum tax credit carryforwards
|
|
|
3,330
|
|
|
|
3,330
|
|
General business tax credit carryforwards
|
|
|
2,666
|
|
|
|
2,095
|
|
Capital loss carryforwards
|
|
|
2,510
|
|
|
|
|
|
Stock awards
|
|
|
1,315
|
|
|
|
1,177
|
|
Unrealized loss on commodity hedges
|
|
|
1,115
|
|
|
|
1,852
|
|
Other
|
|
|
1,496
|
|
|
|
964
|
|
|
|
|
|
|
|
|
|
|
Total deferred tax assets
|
|
|
108,584
|
|
|
|
93,400
|
|
Less: valuation allowance
|
|
|
(84,540
|
)
|
|
|
(70,352
|
)
|
|
|
|
|
|
|
|
|
|
Total deferred tax assets after valuation allowance
|
|
|
24,044
|
|
|
|
23,048
|
|
|
|
|
|
|
|
|
|
|
Deferred tax liabilities:
|
|
|
|
|
|
|
|
|
Amortization of intangibles
|
|
|
(28,210
|
)
|
|
|
(25,973
|
)
|
Other
|
|
|
(286
|
)
|
|
|
(143
|
)
|
|
|
|
|
|
|
|
|
|
Total deferred tax liabilities
|
|
|
(28,496
|
)
|
|
|
(26,116
|
)
|
|
|
|
|
|
|
|
|
|
Net deferred tax liability
|
|
$
|
(4,452
|
)
|
|
$
|
(3,068
|
)
|
|
|
|
|
|
|
|
|
|
111
At April 30, 2014 we have, for federal income tax purposes, net operating loss carryforwards of
approximately $73,772 that expire in fiscal years 2024 through 2034 and state net operating loss carryforwards of approximately $93,680 that expire in fiscal years 2015 through 2034. The net operating loss carryforwards include approximately $383
for which a benefit will be recorded in additional paid-in capital when realized. In addition, we have $3,330 minimum tax credit carryforwards available that are not subject to a time limitation, $2,666 general business credit carryforwards which
expire in fiscal years 2023 through 2034 and $6,235 capital loss carryforward which expires in fiscal year 2019. Sections 382 and 383 of the Internal Revenue Code can limit the amount of net operating loss and credit carryforwards which may be used
in a tax year in the event of certain stock ownership changes. We are not currently subject to these limitations but could become subject to them if there were significant changes in the ownership of our stock.
In assessing the realizability of carryforwards and other deferred tax assets, management considers whether it is more likely than not that some portion or
all of the deferred tax assets will not be realized. We adjust the valuation allowance in the period management determines it is more likely than not that deferred tax assets will or will not be realized.
For fiscal year 2014, the net increase in the valuation allowance was $14,188. For fiscal year 2013, the valuation allowance decreased by $5,084 due to the
recognition of additional reversing temporary differences from the deferred tax liability recorded through goodwill related to the BBI acquisition. The $5,084 deferred tax liability related to the BBI acquisition resulted from temporary differences
related to the amounts of assets and liabilities recognized for financial reporting purposes and such amounts recognized for income tax purposes.
In
determining the need for a valuation allowance, we have assessed the available means of recovering deferred tax assets, including the ability to carryback net operating losses, the existence of reversing temporary differences, the availability of
tax planning strategies, and available sources of future taxable income. We have also considered the ability to implement certain strategies, such as a potential sale of assets that would, if necessary, be implemented to accelerate taxable income
and use expiring deferred tax assets. We believe we are able to support the deferred tax assets recognized as of the end of the year based on all of the available evidence. The net deferred tax liability as of April 30, 2014 includes deferred
tax liabilities related to amortizable goodwill, which are anticipated to reverse in an indefinite future period and which are not currently available as a source of taxable income.
The provisions of ASC 740-10-25-5 prescribe the minimum recognition threshold that a tax position is required to meet before being recognized in the financial
statements. Additionally, ASC 740-10-25-5 provides guidance on de-recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. Under ASC 740-10-25-5, an entity may only recognize or
continue to recognize tax positions that meet a more likely than not threshold. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits for fiscal years 2014 and 2013 are as follows:
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
Unrecognized tax benefits at beginning of period
|
|
$
|
3,879
|
|
|
$
|
4,447
|
|
Gross increases for tax positions of prior years
|
|
|
22
|
|
|
|
543
|
|
Gross decreases for tax positions of prior years
|
|
|
(229
|
)
|
|
|
(26
|
)
|
Reductions resulting from lapse of statute of limitations
|
|
|
(611
|
)
|
|
|
(655
|
)
|
Settlements
|
|
|
|
|
|
|
(430
|
)
|
|
|
|
|
|
|
|
|
|
Unrecognized tax benefits at end of period
|
|
$
|
3,061
|
|
|
$
|
3,879
|
|
|
|
|
|
|
|
|
|
|
The gross increases for tax positions of prior years for 2013 includes $430 tax from the settlement with New York State, which
is offset by the ($430) settlements for 2013. Included in the balances at April 30, 2014 and 2013 are $0 of unrecognized tax benefits (net of the federal benefit on state issues) that, if recognized, would
112
favorably affect the effective income tax rate in future periods. We anticipate that $0 of unrecognized tax benefits may be reversed within the next 12 months due to the expiration of the
applicable statute of limitations.
Our continuing practice is to recognize interest and penalties related to income tax matters in income tax expense.
Related to uncertain tax positions, we have accrued interest of $116 and penalties of $8 during fiscal year 2014, including $40 accrued in income tax expense during the year ended April 30, 2014. We accrued interest of $76 and penalties of $9
related to uncertain tax positions during fiscal year 2013, including $41 accrued in income tax expense during fiscal year 2013. To the extent interest and penalties are not assessed with respect to uncertain tax positions, amounts accrued will be
reduced and reflected as a reduction of the overall income tax provision.
We are subject to U.S. federal income tax, as well as income tax of multiple
state jurisdictions. Due to Federal and state net operating loss carryforwards, income tax returns from fiscal years 1998 through 2014 remain open for examination, with limited exceptions.
16.
|
ASSET IMPAIRMENTS AND OTHER ITEMS
|
Asset Impairment Charge
In April 2014,
we initiated a plan to wind down the operations of CARES and to abandon the operations of CARES in fiscal year 2015. As a result, it was determined that the carrying value of the assets of CARES was no longer recoverable and, as a result, the
carrying value of the asset group was assessed for impairment. The impairment was measured based on the asset groups highest and best use under the market approach. We recorded an impairment charge of $7,455 in fiscal year 2014 to the asset
group of CARES in the Western region.
In the fourth quarter of fiscal year 2012, we entered into negotiations regarding the sale of Maine Energy. Based
on the proposed purchase consideration, we reviewed the asset group for impairment and recorded a $40,746 impairment charge to the asset group located within the Eastern region. The impairment was measured based on the asset groups highest and
best use under the market approach, utilizing the discounted present cash flows associated with the purchase consideration of the facility, adjusted for costs to demolish the facility. We used a discount rate of 3.5%, which approximates the buyers
borrowing rate. See Note 17 for disclosure over the Maine Energy divestiture transaction.
Development Project Charge
In fiscal year 2014 and 2012, we recorded charges of $1,394 and $131 for deferred costs associated with a gas pipeline development project in Maine no longer
deemed viable in fiscal year 2014 and certain development projects no longer deemed viable in fiscal year 2012.
As of April 30, 2014 and
April 30, 2013, we had $0 and $1,644 of deferred costs associated with development projects included in other non-current assets within our consolidated balance sheets.
Severance and Reorganization
In fiscal year 2014, we
recorded a charge of $586 for severance costs associated with various planned reorganization efforts including the divestiture of Maine Energy Recovery Company, LP (Maine Energy).
In fiscal year 2013, we recorded a charge of $3,709 for severance costs associated primarily with the realignment of our operations in order to streamline
functions and improve our cost structure, the closure of Maine Energy and a reorganization of senior management. Through the realignment of our operations we improved certain aspects of the sales function to better facilitate customer service and
retention, pricing growth, and support of strategic growth initiatives; better aligned transportation, route management and maintenance functions at the local level; and reduced corporate overhead and staff to match organizational needs and reduce
costs.
We have liabilities associated with severance and reorganization as of April 30, 2014 and 2013, which are recorded in other accrued
liabilities, of $478 and $680.
113
Expense from Divestiture, Acquisition and Financing Costs
In fiscal year 2014, we incurred $144 of expenses primarily associated with legal costs for the acquisition of the remaining 50% membership interest of
Tompkins. See Note 2 for disclosure over the acquisition of Tompkins.
In fiscal year 2013, we incurred $1,410 of expenses attributable to a $303
write-off of costs associated with the attempted refinancing of our Second Lien Notes, $602 of legal costs associated with the Maine Energy divestiture transaction, as discussed in Note 17, and $505 of costs associated with the BBI acquisition.
Legal Settlement
In fiscal year 2012, we recorded
expenses totaling $1,359 attributable to a $359 legal settlement with the Town of Seneca, New York and a $1,000 legal settlement with the Vermont Attorney Generals Office.
17.
|
DIVESTITURE TRANSACTIONS AND DISCONTINUED OPERATIONS
|
We review planned business dispositions based on available information and events that have occurred to determine whether or not a business
or disposal group qualifies for discontinued operations treatment. The review consists of evaluating whether the business qualifies as a component of an entity for which the operations and cash flows are clearly distinguishable; whether it is
anticipated that the cash flows of the component have been or will be eliminated from ongoing operations after the disposal transaction and by the end of the assessment period; and whether we will have any significant continuing involvement in the
operations of the component after the disposal transaction. Planned business dispositions are presented as discontinued operations when all three criteria are met. Additionally, we evaluate whether the component has met the criteria to be classified
as held-for-sale. To be classified as held-for-sale, the criteria established by FASB ASC 360-10 must be met as of the reporting date, including an active program to market the business and the disposition of the business within one year. A business
that has not been disposed of may not be classified as discontinued operations until the held-for-sale criteria are met. No depreciation is recorded during the periods in which a disposal group is classified as held-for-sale.
Businesses that qualify as held-for-sale are carried at the lower of their carrying value or fair value less costs to sell in the period the held-for-sale
criteria are met. For a business that is classified as held-for-sale and meets the discontinued operations criteria, all initial or subsequent adjustments to the carrying value of the component are classified in discontinued operations.
Discontinued Operations
In the fourth quarter of fiscal
year 2013, we initiated a plan to dispose of KTI BioFuels, Inc. (BioFuels), a construction and demolition material processing facility located in Lewiston, Maine, and as a result, the assets associated with BioFuels were classified as
held-for-sale and the results of operations were recorded as loss from discontinued operations. Assets of the disposal group previously classified as held-for-sale, and included in discontinued operations as of April 30, 2013, include certain
inventory along with plant and equipment. In the first quarter of fiscal year 2014, we executed a purchase and sale agreement with ReEnergy Lewiston LLC (ReEnergy), pursuant to which we agreed to sell certain assets of BioFuels, which
was located in our Eastern region, to ReEnergy. We agreed to sell the BioFuels assets for undiscounted purchase consideration of $2,000, which is being paid to us in equal quarterly installments over five years commencing November 1, 2013,
subject to the terms of the purchase and sale agreement. We recognized a $378 loss on disposal of discontinued operations in the first quarter of fiscal year 2014 associated with the disposition.
The operating results of these operations, including those related to prior years, have been reclassified from continuing to discontinued operations in the
accompanying consolidated financial statements. Revenues and loss
114
before income taxes attributable to discontinued operations for fiscal year 2014, 2013 and 2012, respectively, are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Revenues
|
|
$
|
3,316
|
|
|
$
|
12,033
|
|
|
$
|
12,865
|
|
Income (loss) before income taxes
|
|
$
|
284
|
|
|
$
|
(4,480
|
)
|
|
$
|
(1,025
|
)
|
We allocate interest expense to discontinued operations. We have also eliminated inter-company activity associated with
discontinued operations.
Divestiture Transactions
In the first quarter of fiscal year 2013, we executed a purchase and sale agreement with the City of Biddeford, Maine, pursuant to which we agreed to sell the
real property of Maine Energy to the City of Biddeford, subject to satisfaction of conditions precedent and closing. We agreed to sell Maine Energy for undiscounted purchase consideration of $6,650, which is being paid to us in equal installments
over 21 years, subject to the terms of the purchase and sale agreement. The transaction closed in November 2012, and we waived certain conditions precedent not satisfied at that time. In December 2012, we closed the Maine Energy facility and
initiated the decommissioning process in accordance with the provisions of the agreement. Following the decommissioning of the Maine Energy facility, it is our responsibility to demolish the facility, at our cost, within twelve months of the closing
date and in accordance with the terms of the purchase and sale agreement. On June 2, 2014, the United States Environmental Protection Agency provided final approval of the work plans to complete the last phase of the decommissioning
process. The time for completion has been consensually extended by Maine Energy and the City of Biddeford and we expect to complete the decommissioning process within the current agreed upon timeframe. We will continue to finalize estimates and
obtain additional information regarding the estimated costs associated with the divestiture. Due to the inherent judgments and estimates regarding the remaining costs to fulfill our obligation under the purchase and sale agreement to demolish the
facility and remediate the site, recognition of a loss on divestiture, which we do not expect, or a potential gain on divestiture is possible.
As a part
of the closure and decommissioning of the Maine Energy facility, we have withdrawn from a multiemployer pension plan to which we have made contributions for the benefit of Maine Energy employees covered under a collective bargaining agreement. In
the fourth quarter of fiscal year 2014, based on information provided by the fund administrator, we determined that we have no obligation associated with the plans unfunded vested benefit based on our withdrawal.
The following table sets forth the numerator and denominator used in the computation of earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Numerator:
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations before discontinued operations attributable to common stockholders
|
|
$
|
(23,001
|
)
|
|
$
|
(49,662
|
)
|
|
$
|
(77,697
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares outstanding, end of period:
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common stock
|
|
|
39,086
|
|
|
|
38,662
|
|
|
|
25,991
|
|
Class B common stock
|
|
|
988
|
|
|
|
988
|
|
|
|
988
|
|
Unvested restricted stock
|
|
|
(130
|
)
|
|
|
(134
|
)
|
|
|
(127
|
)
|
Effect of weighted average shares outstanding during period
|
|
|
(124
|
)
|
|
|
(5,501
|
)
|
|
|
(103
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares used in basic and diluted EPS
|
|
|
39,820
|
|
|
|
34,015
|
|
|
|
26,749
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
115
For fiscal years 2014, 2013 and 2012, 2,190, 2,074 and 2,445 shares, respectively, of potential common stock
related to restricted stock, restricted stock units, performance stock units, and stock options were excluded from the calculation of dilutive shares since we experienced a loss from continuing operations in each fiscal year period and the inclusion
of potential shares would be anti-dilutive.
19.
|
RELATED PARTY TRANSACTIONS
|
Services
During fiscal years 2014,
2013 and 2012, we retained the services of a related party, a company wholly owned by John Casella, our Chairman and Chief Executive Officer, and Douglas Casella, a member of our Board of Directors, as a contractor in developing or closing certain
landfills owned by us. Total purchased services charged to operations or capitalized to landfills for fiscal years 2014, 2013 and 2012 were $7,816, $6,577 and $2,612, respectively, of which $890 and $1,189 were outstanding and included in either
accounts payable or other current liabilities at April 30, 2014 and 2013, respectively.
Leases
In fiscal year 1994, we entered into two leases for operating facilities with a partnership of which John Casella, our Chairman and Chief Executive Officer,
and Douglas Casella, a member of our Board of Directors are the general partners. The leases have since been extended through April 2023 and according to the terms of the agreements called for monthly payments of approximately $27. Total expense
charged to operations for fiscal years 2014, 2013 and 2012 under these agreements was $386, $286 and $300, respectively.
Landfill Post-closure
We have agreed to pay the cost of post-closure on a landfill owned by two of our major stockholders and members of the Board of Directors (one of whom
is also an officer). We paid the cost of closing this landfill in 1992, and the post-closure maintenance obligations are expected to last until 2024. In fiscal years 2014, 2013 and 2012, we paid $8, $8 and $8 respectively, pursuant to this
agreement. As of April 30, 2014 and 2013, we have accrued $94 and $100, respectively, for costs associated with its post-closure obligations.
Employee Loan
In fiscal year 2014, we entered into an
agreement with an employee to amend a promissory note, whereas the outstanding balance of $149, which had been included in Notes receivable related party in the accompanying consolidated balance sheet, shall be deemed paid in full in exchange
for continued employment and the employee forgoing participation in the annual cash incentive plan and restricted stock program for a period of time specified in the amended note. Upon entering into the amended note, interest ceased accruing on the
note and we recorded a charge of $149 in general and administration to reserve for the note.
We report selected information about operating segments in a manner consistent with that used for internal management reporting. We classify
our solid waste operations on a geographic basis through regional operating segments. Revenues are derived mainly from collection, transfer, disposal, landfill, landfill-gas-to-energy and recycling services in the northeastern United States. Our
revenues in the Recycling segment are derived from municipalities and customers in the form of processing fees, tipping fees and commodity sales. Organics services, ancillary operations, major customer accounts, discontinued operations, and earnings
from equity method investees are included in our Other segment. Segment data for fiscal years 2013 and 2012 has been revised to properly align with internal management reporting, which was modified in fiscal year 2014 as follows: to move Organics
services from the Eastern region to the Other segment to reflect changes in management structure as these services have become integral to service offerings across our broader geographic solid waste footprint; and to move a smaller brokerage
operation from the Eastern region to the Recycling segment to align with the rest of our brokerage operations.
116
Fiscal Year Ended April 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment
|
|
Outside
revenues
|
|
|
Inter-company
revenue
|
|
|
Depreciation and
amortization
|
|
|
Operating
income (loss)
|
|
|
Interest
expense (net)
|
|
|
Capital
expenditures
|
|
|
Goodwill
|
|
|
Total assets
|
|
Eastern
|
|
$
|
147,330
|
|
|
$
|
38,946
|
|
|
$
|
24,961
|
|
|
$
|
(1,105
|
)
|
|
$
|
(272
|
)
|
|
$
|
19,870
|
|
|
$
|
17,429
|
|
|
$
|
200,235
|
|
Western
|
|
|
216,911
|
|
|
|
70,809
|
|
|
|
28,693
|
|
|
|
13,298
|
|
|
|
112
|
|
|
|
20,471
|
|
|
|
87,666
|
|
|
|
331,304
|
|
Recycling
|
|
|
43,825
|
|
|
|
(139
|
)
|
|
|
4,262
|
|
|
|
(2,435
|
)
|
|
|
|
|
|
|
1,111
|
|
|
|
12,315
|
|
|
|
49,652
|
|
Other
|
|
|
89,567
|
|
|
|
2,019
|
|
|
|
2,423
|
|
|
|
2,158
|
|
|
|
38,023
|
|
|
|
4,507
|
|
|
|
1,729
|
|
|
|
68,706
|
|
Eliminations
|
|
|
|
|
|
|
(111,635
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
497,633
|
|
|
$
|
|
|
|
$
|
60,339
|
|
|
$
|
11,916
|
|
|
$
|
37,863
|
|
|
$
|
45,959
|
|
|
$
|
119,139
|
|
|
$
|
649,897
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment
|
|
Outside
revenues
|
|
|
Inter-company
revenue
|
|
|
Depreciation and
amortization
|
|
|
Operating
income (loss)
|
|
|
Interest
expense (net)
|
|
|
Capital
expenditures
|
|
|
Goodwill
|
|
|
Total assets
|
|
Eastern
|
|
$
|
129,889
|
|
|
$
|
30,933
|
|
|
$
|
23,518
|
|
|
$
|
(5,291
|
)
|
|
$
|
27,054
|
|
|
$
|
20,383
|
|
|
$
|
16,858
|
|
|
$
|
198,710
|
|
Western
|
|
|
205,747
|
|
|
|
65,390
|
|
|
|
26,446
|
|
|
|
20,058
|
|
|
|
(1,311
|
)
|
|
|
30,384
|
|
|
|
86,880
|
|
|
|
348,455
|
|
Recycling
|
|
|
42,273
|
|
|
|
116
|
|
|
|
4,303
|
|
|
|
(697
|
)
|
|
|
5,553
|
|
|
|
935
|
|
|
|
12,190
|
|
|
|
50,921
|
|
Other
|
|
|
77,426
|
|
|
|
3,933
|
|
|
|
2,309
|
|
|
|
(1,649
|
)
|
|
|
10,133
|
|
|
|
3,325
|
|
|
|
|
|
|
|
65,033
|
|
Eliminations
|
|
|
|
|
|
|
(100,372
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
455,335
|
|
|
$
|
|
|
|
$
|
56,576
|
|
|
$
|
12,421
|
|
|
$
|
41,429
|
|
|
$
|
55,027
|
|
|
$
|
115,928
|
|
|
$
|
663,119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment
|
|
Outside
revenues
|
|
|
Inter-company
revenue
|
|
|
Depreciation and
amortization
|
|
|
Operating
income (loss)
|
|
|
Interest
expense (net)
|
|
|
Capital
expenditures
|
|
|
Goodwill
|
|
|
Total assets
|
|
Eastern
|
|
$
|
127,930
|
|
|
$
|
33,559
|
|
|
$
|
25,179
|
|
|
$
|
(43,640
|
)
|
|
$
|
31,637
|
|
|
$
|
19,734
|
|
|
$
|
58
|
|
|
$
|
166,938
|
|
Western
|
|
|
212,227
|
|
|
|
67,776
|
|
|
|
26,168
|
|
|
|
29,715
|
|
|
|
80
|
|
|
|
27,467
|
|
|
|
89,458
|
|
|
|
333,381
|
|
Recycling
|
|
|
52,195
|
|
|
|
57
|
|
|
|
4,130
|
|
|
|
5,088
|
|
|
|
6,795
|
|
|
|
5,494
|
|
|
|
12,190
|
|
|
|
55,434
|
|
Other
|
|
|
75,598
|
|
|
|
4,466
|
|
|
|
2,938
|
|
|
|
(2,196
|
)
|
|
|
6,454
|
|
|
|
5,668
|
|
|
|
|
|
|
|
77,990
|
|
Eliminations
|
|
|
|
|
|
|
(105,858
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
467,950
|
|
|
$
|
|
|
|
$
|
58,415
|
|
|
$
|
(11,033
|
)
|
|
$
|
44,966
|
|
|
$
|
58,363
|
|
|
$
|
101,706
|
|
|
$
|
633,743
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts of our total revenue attributable to services provided are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year Ended April 30,
|
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
Collection
|
|
$
|
225,441
|
|
|
|
45.3
|
%
|
|
$
|
208,973
|
|
|
|
45.9
|
%
|
|
$
|
205,296
|
|
|
|
43.9
|
%
|
Disposal
|
|
|
128,778
|
|
|
|
25.9
|
%
|
|
|
115,049
|
|
|
|
25.3
|
%
|
|
|
123,620
|
|
|
|
26.4
|
%
|
Power generation
|
|
|
9,512
|
|
|
|
1.9
|
%
|
|
|
11,354
|
|
|
|
2.4
|
%
|
|
|
11,894
|
|
|
|
2.6
|
%
|
Processing
|
|
|
8,852
|
|
|
|
1.8
|
%
|
|
|
6,901
|
|
|
|
1.5
|
%
|
|
|
5,772
|
|
|
|
1.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Solid waste operations
|
|
|
372,583
|
|
|
|
74.9
|
%
|
|
|
342,277
|
|
|
|
75.1
|
%
|
|
|
346,582
|
|
|
|
74.1
|
%
|
Organics
|
|
|
37,829
|
|
|
|
7.6
|
%
|
|
|
35,330
|
|
|
|
7.8
|
%
|
|
|
30,871
|
|
|
|
6.6
|
%
|
Customer solutions
|
|
|
43,396
|
|
|
|
8.7
|
%
|
|
|
35,455
|
|
|
|
7.8
|
%
|
|
|
38,302
|
|
|
|
8.2
|
%
|
Recycling
|
|
|
43,825
|
|
|
|
8.8
|
%
|
|
|
42,273
|
|
|
|
9.3
|
%
|
|
|
52,195
|
|
|
|
11.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
497,633
|
|
|
|
100.0
|
%
|
|
$
|
455,335
|
|
|
|
100.0
|
%
|
|
$
|
467,950
|
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
We have revised our table of revenue by source to more closely align the types of revenue generated by our operating segments.
Amounts for fiscal years 2013 and 2012 have been revised to conform to this presentation.
117
21.
|
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
|
The following is a summary of certain items in the consolidated statements of operations by quarter for fiscal years 2014, 2013 and 2012.
The impact of discontinued operations, as described in Note 17, is included in all periods in the table below.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year 2014
|
|
First
Quarter
|
|
|
Second
Quarter
|
|
|
Third
Quarter
|
|
|
Fourth
Quarter
|
|
Revenues
|
|
$
|
128,558
|
|
|
$
|
132,296
|
|
|
$
|
117,852
|
|
|
$
|
118,927
|
|
Operating income (loss)
|
|
$
|
9,737
|
|
|
$
|
9,450
|
|
|
$
|
(1,298
|
)
|
|
$
|
(5,973
|
)
|
Loss from continuing operations before discontinued operations
|
|
$
|
(114
|
)
|
|
$
|
(530
|
)
|
|
$
|
(11,033
|
)
|
|
$
|
(15,633
|
)
|
Net loss attributable to common stockholders
|
|
$
|
(191
|
)
|
|
$
|
(339
|
)
|
|
$
|
(10,750
|
)
|
|
$
|
(11,815
|
)
|
Loss per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations before discontinued operations
|
|
$
|
(0.00
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.39
|
)
|
Net loss attributable to common stockholders
|
|
$
|
(0.00
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.27
|
)
|
|
$
|
(0.30
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year 2013
|
|
First
Quarter
|
|
|
Second
Quarter
|
|
|
Third
Quarter
|
|
|
Fourth
Quarter
|
|
Revenues
|
|
$
|
117,638
|
|
|
$
|
116,836
|
|
|
$
|
112,167
|
|
|
$
|
108,694
|
|
Operating income
|
|
$
|
5,807
|
|
|
$
|
4,426
|
|
|
$
|
78
|
|
|
$
|
2,110
|
|
Loss from continuing operations before discontinued operations
|
|
$
|
(8,163
|
)
|
|
$
|
(20,857
|
)
|
|
$
|
(11,146
|
)
|
|
$
|
(9,817
|
)
|
Net loss attributable to common stockholders
|
|
$
|
(8,371
|
)
|
|
$
|
(20,967
|
)
|
|
$
|
(11,407
|
)
|
|
$
|
(13,397
|
)
|
Loss per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations before discontinued operations
|
|
$
|
(0.30
|
)
|
|
$
|
(0.68
|
)
|
|
$
|
(0.28
|
)
|
|
$
|
(0.25
|
)
|
Net loss attributable to common stockholders
|
|
$
|
(0.31
|
)
|
|
$
|
(0.68
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
(0.34
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Year 2012
|
|
First
Quarter
|
|
|
Second
Quarter
|
|
|
Third
Quarter
|
|
|
Fourth
Quarter
|
|
Revenues
|
|
$
|
124,066
|
|
|
$
|
125,989
|
|
|
$
|
111,520
|
|
|
$
|
106,375
|
|
Operating income (loss)
|
|
$
|
10,468
|
|
|
$
|
11,730
|
|
|
$
|
4,448
|
|
|
$
|
(37,679
|
)
|
Loss from continuing operations before discontinued operations
|
|
$
|
(3,502
|
)
|
|
$
|
(693
|
)
|
|
$
|
(24,517
|
)
|
|
$
|
(48,991
|
)
|
Net loss attributable to common stockholders
|
|
$
|
(3,062
|
)
|
|
$
|
(765
|
)
|
|
$
|
(24,635
|
)
|
|
$
|
(49,124
|
)
|
Loss per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from continuing operations before discontinued operations
|
|
$
|
(0.13
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.91
|
)
|
|
$
|
(1.82
|
)
|
Net loss attributable to common stockholders
|
|
$
|
(0.12
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.92
|
)
|
|
$
|
(1.83
|
)
|
Our transfer and disposal revenues historically have been lower during the months of November through March. This
seasonality reflects the lower volume of waste during the late fall, winter and early spring months. Since certain of our operating and fixed costs remain constant throughout fiscal year, operating income is impacted by a similar seasonality. In
addition, particularly harsh weather conditions typically result in increased operating costs.
Our recycling business experiences increased volumes of
newspaper in November and December due to increased newspaper advertising and retail activity during the holiday season.
118
22.
|
SUBSIDIARY GUARANTORS
|
Our 2019 Notes are guaranteed jointly and severally, fully and unconditionally, by our significant wholly-owned subsidiaries. The
Parent is the issuer and a non-guarantor of the 2019 Notes and the Parent has no independent assets or operations. The information which follows presents the condensed consolidating financial position as of April 30, 2014 and April 30,
2013, the consolidating results of operations and comprehensive loss for fiscal years 2014, 2013 and 2012, and the condensed consolidating statements of cash flows for fiscal years 2014, 2013 and 2012 of (a) the Parent company only,
(b) the combined guarantors (the Guarantors) , each of which is 100% wholly-owned by the Parent, (c) the combined non-guarantors (the Non-Guarantors) , (d) eliminating entries and (e) the
consolidated total.
119
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
AS OF APRIL 30, 2014
(in
thousands, except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
2,151
|
|
|
$
|
271
|
|
|
$
|
42
|
|
|
$
|
|
|
|
$
|
2,464
|
|
Restricted cash
|
|
|
|
|
|
|
76
|
|
|
|
|
|
|
|
|
|
|
|
76
|
|
Accounts receivable trade, net
|
|
|
534
|
|
|
|
51,983
|
|
|
|
86
|
|
|
|
|
|
|
|
52,603
|
|
Refundable income taxes
|
|
|
465
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
465
|
|
Prepaid expenses
|
|
|
2,617
|
|
|
|
4,557
|
|
|
|
2
|
|
|
|
|
|
|
|
7,176
|
|
Inventory
|
|
|
|
|
|
|
3,852
|
|
|
|
53
|
|
|
|
|
|
|
|
3,905
|
|
Deferred income taxes
|
|
|
2,502
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,502
|
|
Other current assets
|
|
|
312
|
|
|
|
936
|
|
|
|
7
|
|
|
|
|
|
|
|
1,255
|
|
Current assets of discontinued operations
|
|
|
|
|
|
|
359
|
|
|
|
|
|
|
|
|
|
|
|
359
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
8,581
|
|
|
|
62,034
|
|
|
|
190
|
|
|
|
|
|
|
|
70,805
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
4,104
|
|
|
|
398,670
|
|
|
|
650
|
|
|
|
|
|
|
|
403,424
|
|
Goodwill
|
|
|
|
|
|
|
119,139
|
|
|
|
|
|
|
|
|
|
|
|
119,139
|
|
Intangible assets, net
|
|
|
159
|
|
|
|
13,261
|
|
|
|
|
|
|
|
|
|
|
|
13,420
|
|
Restricted assets
|
|
|
|
|
|
|
681
|
|
|
|
|
|
|
|
|
|
|
|
681
|
|
Investments in unconsolidated entities
|
|
|
16,752
|
|
|
|
1,932
|
|
|
|
|
|
|
|
(1,932
|
)
|
|
|
16,752
|
|
Investments in subsidiaries
|
|
|
(36,006
|
)
|
|
|
|
|
|
|
|
|
|
|
36,006
|
|
|
|
|
|
Other non-current assets
|
|
|
13,874
|
|
|
|
10,331
|
|
|
|
|
|
|
|
|
|
|
|
24,205
|
|
Non-current assets of discontinued operations
|
|
|
|
|
|
|
1,471
|
|
|
|
|
|
|
|
|
|
|
|
1,471
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,117
|
)
|
|
|
545,485
|
|
|
|
650
|
|
|
|
34,074
|
|
|
|
579,092
|
|
|
|
|
|
|
|
Intercompany receivable
|
|
|
543,291
|
|
|
|
(506,348
|
)
|
|
|
(38,875
|
)
|
|
|
1,932
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
550,755
|
|
|
$
|
101,171
|
|
|
$
|
(38,035
|
)
|
|
$
|
36,006
|
|
|
$
|
649,897
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS (DEFICIT) EQUITY
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current maturities of long-term debt and capital leases
|
|
$
|
84
|
|
|
$
|
801
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
885
|
|
Accounts payable
|
|
|
22,678
|
|
|
|
28,286
|
|
|
|
824
|
|
|
|
|
|
|
|
51,788
|
|
Accrued payroll and related expenses
|
|
|
1,212
|
|
|
|
4,849
|
|
|
|
1
|
|
|
|
|
|
|
|
6,062
|
|
Accrued interest
|
|
|
6,084
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
6,087
|
|
Current accrued capping, closure and post-closure costs
|
|
|
|
|
|
|
7,309
|
|
|
|
3
|
|
|
|
|
|
|
|
7,312
|
|
Other accrued liabilities
|
|
|
7,289
|
|
|
|
10,081
|
|
|
|
242
|
|
|
|
|
|
|
|
17,612
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
37,347
|
|
|
|
51,329
|
|
|
|
1,070
|
|
|
|
|
|
|
|
89,746
|
|
|
|
|
|
|
|
Long-term debt and capital leases, less current maturities
|
|
|
504,836
|
|
|
|
2,298
|
|
|
|
|
|
|
|
|
|
|
|
507,134
|
|
Accrued capping, closure and post-closure costs, less current portion
|
|
|
|
|
|
|
37,306
|
|
|
|
36
|
|
|
|
|
|
|
|
37,342
|
|
Deferred income taxes
|
|
|
6,954
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,954
|
|
Other long-term liabilities
|
|
|
10,025
|
|
|
|
7,149
|
|
|
|
84
|
|
|
|
|
|
|
|
17,258
|
|
|
|
|
|
|
|
STOCKHOLDERS (DEFICIT) EQUITY:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Casella Waste Systems, Inc. stockholders (deficit) equity
|
|
|
(8,407
|
)
|
|
|
3,089
|
|
|
|
(39,095
|
)
|
|
|
36,006
|
|
|
|
(8,407
|
)
|
Noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
(130
|
)
|
|
|
|
|
|
|
(130
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders (deficit) equity
|
|
|
(8,407
|
)
|
|
|
3,089
|
|
|
|
(39,225
|
)
|
|
|
36,006
|
|
|
|
(8,537
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
550,755
|
|
|
$
|
101,171
|
|
|
$
|
(38,035
|
)
|
|
$
|
36,006
|
|
|
$
|
649,897
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
120
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING BALANCE SHEET
AS OF APRIL 30, 2013
(in
thousands, except for share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
1,260
|
|
|
$
|
253
|
|
|
$
|
242
|
|
|
$
|
|
|
|
$
|
1,755
|
|
Restricted cash
|
|
|
|
|
|
|
76
|
|
|
|
|
|
|
|
|
|
|
|
76
|
|
Accounts receivable trade, net
|
|
|
571
|
|
|
|
47,644
|
|
|
|
474
|
|
|
|
|
|
|
|
48,689
|
|
Refundable income taxes
|
|
|
128
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
128
|
|
Prepaid expenses
|
|
|
1,471
|
|
|
|
4,240
|
|
|
|
|
|
|
|
|
|
|
|
5,711
|
|
Inventory
|
|
|
|
|
|
|
3,440
|
|
|
|
54
|
|
|
|
|
|
|
|
3,494
|
|
Deferred income taxes
|
|
|
3,730
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,730
|
|
Other current assets
|
|
|
366
|
|
|
|
528
|
|
|
|
7
|
|
|
|
|
|
|
|
901
|
|
Current assets of discontinued operations
|
|
|
|
|
|
|
61
|
|
|
|
|
|
|
|
|
|
|
|
61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
7,526
|
|
|
|
56,242
|
|
|
|
777
|
|
|
|
|
|
|
|
64,545
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
2,771
|
|
|
|
411,284
|
|
|
|
8,447
|
|
|
|
|
|
|
|
422,502
|
|
Goodwill
|
|
|
|
|
|
|
115,928
|
|
|
|
|
|
|
|
|
|
|
|
115,928
|
|
Intangible assets, net
|
|
|
249
|
|
|
|
11,425
|
|
|
|
|
|
|
|
|
|
|
|
11,674
|
|
Restricted assets
|
|
|
|
|
|
|
545
|
|
|
|
|
|
|
|
|
|
|
|
545
|
|
Notes receivable related party/employee
|
|
|
147
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
147
|
|
Investments in unconsolidated entities
|
|
|
16,486
|
|
|
|
2,189
|
|
|
|
3,509
|
|
|
|
(1,932
|
)
|
|
|
20,252
|
|
Investments in subsidiaries
|
|
|
(59,759
|
)
|
|
|
|
|
|
|
|
|
|
|
59,759
|
|
|
|
|
|
Other non-current assets
|
|
|
15,774
|
|
|
|
11,752
|
|
|
|
|
|
|
|
|
|
|
|
27,526
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(24,332
|
)
|
|
|
553,123
|
|
|
|
11,956
|
|
|
|
57,827
|
|
|
|
598,574
|
|
|
|
|
|
|
|
Intercompany receivable
|
|
|
580,328
|
|
|
|
(539,752
|
)
|
|
|
(42,508
|
)
|
|
|
1,932
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
563,522
|
|
|
$
|
69,613
|
|
|
$
|
(29,775
|
)
|
|
$
|
59,759
|
|
|
$
|
663,119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS EQUITY
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current maturities of long-term debt and capital leases
|
|
$
|
|
|
|
$
|
1,218
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
1,218
|
|
Accounts payable
|
|
|
23,492
|
|
|
|
27,847
|
|
|
|
635
|
|
|
|
|
|
|
|
51,974
|
|
Accrued payroll and related expenses
|
|
|
538
|
|
|
|
3,445
|
|
|
|
|
|
|
|
|
|
|
|
3,983
|
|
Accrued interest
|
|
|
6,071
|
|
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
6,074
|
|
Current accrued capping, closure and post-closure costs
|
|
|
|
|
|
|
3,832
|
|
|
|
3
|
|
|
|
|
|
|
|
3,835
|
|
Other accrued liabilities
|
|
|
10,001
|
|
|
|
10,896
|
|
|
|
117
|
|
|
|
|
|
|
|
21,014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
40,102
|
|
|
|
47,241
|
|
|
|
755
|
|
|
|
|
|
|
|
88,098
|
|
|
|
|
|
|
|
Long-term debt and capital leases, less current maturities
|
|
|
492,965
|
|
|
|
2,022
|
|
|
|
|
|
|
|
|
|
|
|
494,987
|
|
Accrued capping, closure and post-closure costs, less current portion
|
|
|
|
|
|
|
39,298
|
|
|
|
37
|
|
|
|
|
|
|
|
39,335
|
|
Deferred income taxes
|
|
|
6,798
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,798
|
|
Other long-term liabilities
|
|
|
12,372
|
|
|
|
6,078
|
|
|
|
|
|
|
|
|
|
|
|
18,450
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS EQUITY:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Casella Waste Systems, Inc. stockholders equity
|
|
|
11,285
|
|
|
|
(25,026
|
)
|
|
|
(34,733
|
)
|
|
|
59,759
|
|
|
|
11,285
|
|
Noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
4,166
|
|
|
|
|
|
|
|
4,166
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders equity
|
|
|
11,285
|
|
|
|
(25,026
|
)
|
|
|
(30,567
|
)
|
|
|
59,759
|
|
|
|
15,451
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
563,522
|
|
|
$
|
69,613
|
|
|
$
|
(29,775
|
)
|
|
$
|
59,759
|
|
|
$
|
663,119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
121
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF OPERATIONS
FISCAL YEAR ENDED APRIL 30, 2014
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Revenues
|
|
$
|
|
|
|
$
|
495,391
|
|
|
$
|
2,242
|
|
|
$
|
|
|
|
$
|
497,633
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of operations
|
|
|
(23
|
)
|
|
|
351,829
|
|
|
|
2,786
|
|
|
|
|
|
|
|
354,592
|
|
General and administration
|
|
|
1,377
|
|
|
|
60,446
|
|
|
|
42
|
|
|
|
|
|
|
|
61,865
|
|
Depreciation and amortization
|
|
|
935
|
|
|
|
58,651
|
|
|
|
753
|
|
|
|
|
|
|
|
60,339
|
|
Asset impairment charge
|
|
|
|
|
|
|
|
|
|
|
7,455
|
|
|
|
|
|
|
|
7,455
|
|
Development project charge
|
|
|
|
|
|
|
1,394
|
|
|
|
|
|
|
|
|
|
|
|
1,394
|
|
Severance and reorganization costs
|
|
|
4
|
|
|
|
582
|
|
|
|
|
|
|
|
|
|
|
|
586
|
|
Environmental remediation charge
|
|
|
|
|
|
|
400
|
|
|
|
|
|
|
|
|
|
|
|
400
|
|
Expense from divestiture, acquisition and financing costs
|
|
|
|
|
|
|
144
|
|
|
|
|
|
|
|
|
|
|
|
144
|
|
Change in fair value of acquisition related contingent consideration
|
|
|
|
|
|
|
(1,058
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,058
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,293
|
|
|
|
472,388
|
|
|
|
11,036
|
|
|
|
|
|
|
|
485,717
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
(2,293
|
)
|
|
|
23,003
|
|
|
|
(8,794
|
)
|
|
|
|
|
|
|
11,916
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense (income), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
(4
|
)
|
|
|
(308
|
)
|
|
|
|
|
|
|
|
|
|
|
(312
|
)
|
Interest expense
|
|
|
38,095
|
|
|
|
80
|
|
|
|
|
|
|
|
|
|
|
|
38,175
|
|
(Income) loss from equity method investments
|
|
|
(18,811
|
)
|
|
|
(169
|
)
|
|
|
1,105
|
|
|
|
18,811
|
|
|
|
936
|
|
(Gain) loss on sale of equity method investment
|
|
|
|
|
|
|
|
|
|
|
(593
|
)
|
|
|
|
|
|
|
(593
|
)
|
(Gain) loss on derivative instruments
|
|
|
280
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
280
|
|
Other income
|
|
|
(557
|
)
|
|
|
(501
|
)
|
|
|
(1
|
)
|
|
|
|
|
|
|
(1,059
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense, net
|
|
|
19,003
|
|
|
|
(898
|
)
|
|
|
511
|
|
|
|
18,811
|
|
|
|
37,427
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes
|
|
|
(21,296
|
)
|
|
|
23,901
|
|
|
|
(9,305
|
)
|
|
|
(18,811
|
)
|
|
|
(25,511
|
)
|
Provision (benefit) for income taxes
|
|
|
1,799
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,799
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
(23,095
|
)
|
|
|
23,901
|
|
|
|
(9,305
|
)
|
|
|
(18,811
|
)
|
|
|
(27,310
|
)
|
|
|
|
|
|
|
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from discontinued operations, net
|
|
|
|
|
|
|
284
|
|
|
|
|
|
|
|
|
|
|
|
284
|
|
Gain (loss) on disposal of discontinued operations, net
|
|
|
|
|
|
|
(378
|
)
|
|
|
|
|
|
|
|
|
|
|
(378
|
)
|
Net income (loss)
|
|
|
(23,095
|
)
|
|
|
23,807
|
|
|
|
(9,305
|
)
|
|
|
(18,811
|
)
|
|
|
(27,404
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net income (loss) attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
(4,309
|
)
|
|
|
|
|
|
|
(4,309
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to common stockholders
|
|
$
|
(23,095
|
)
|
|
$
|
23,807
|
|
|
$
|
(4,996
|
)
|
|
$
|
(18,811
|
)
|
|
$
|
(23,095
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
122
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF OPERATIONS
FISCAL YEAR ENDED APRIL 30, 2013
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Revenues
|
|
$
|
|
|
|
$
|
453,589
|
|
|
$
|
1,746
|
|
|
$
|
|
|
|
$
|
455,335
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of operations
|
|
|
(295
|
)
|
|
|
321,382
|
|
|
|
1,927
|
|
|
|
|
|
|
|
323,014
|
|
General and administration
|
|
|
220
|
|
|
|
57,898
|
|
|
|
87
|
|
|
|
|
|
|
|
58,205
|
|
Depreciation and amortization
|
|
|
1,017
|
|
|
|
55,142
|
|
|
|
417
|
|
|
|
|
|
|
|
56,576
|
|
Severance and reorganization costs
|
|
|
1,766
|
|
|
|
1,943
|
|
|
|
|
|
|
|
|
|
|
|
3,709
|
|
Expense from divestiture, acquisition and financing costs
|
|
|
303
|
|
|
|
1,107
|
|
|
|
|
|
|
|
|
|
|
|
1,410
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,011
|
|
|
|
437,472
|
|
|
|
2,431
|
|
|
|
|
|
|
|
442,914
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
(3,011
|
)
|
|
|
16,117
|
|
|
|
(685
|
)
|
|
|
|
|
|
|
12,421
|
|
|
|
|
|
|
|
Other expense (income), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
(32,896
|
)
|
|
|
(113
|
)
|
|
|
|
|
|
|
32,868
|
|
|
|
(141
|
)
|
Interest expense
|
|
|
42,405
|
|
|
|
32,033
|
|
|
|
|
|
|
|
(32,868
|
)
|
|
|
41,570
|
|
Loss (income) from equity method investments
|
|
|
24,723
|
|
|
|
36
|
|
|
|
4,405
|
|
|
|
(24,723
|
)
|
|
|
4,441
|
|
Loss on derivative instruments
|
|
|
4,512
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,512
|
|
Loss on debt extinguishment
|
|
|
15,584
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,584
|
|
Other income
|
|
|
(671
|
)
|
|
|
(365
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,036
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense, net
|
|
|
53,657
|
|
|
|
31,591
|
|
|
|
4,405
|
|
|
|
(24,723
|
)
|
|
|
64,930
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes
|
|
|
(56,668
|
)
|
|
|
(15,474
|
)
|
|
|
(5,090
|
)
|
|
|
24,723
|
|
|
|
(52,509
|
)
|
Provision (benefit) for income taxes
|
|
|
(2,526
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,526
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
(54,142
|
)
|
|
|
(15,474
|
)
|
|
|
(5,090
|
)
|
|
|
24,723
|
|
|
|
(49,983
|
)
|
|
|
|
|
|
|
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from discontinued operations, net
|
|
|
|
|
|
|
(4,480
|
)
|
|
|
|
|
|
|
|
|
|
|
(4,480
|
)
|
Gain (loss) on disposal of discontinued operations, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
(54,142
|
)
|
|
|
(19,954
|
)
|
|
|
(5,090
|
)
|
|
|
24,723
|
|
|
|
(54,463
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net income (loss) attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(321
|
)
|
|
|
|
|
|
|
(321
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to common stockholders
|
|
$
|
(54,142
|
)
|
|
$
|
(19,954
|
)
|
|
$
|
(4,769
|
)
|
|
$
|
24,723
|
|
|
$
|
(54,142
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
123
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF OPERATIONS
FISCAL YEAR ENDED APRIL 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Revenues
|
|
$
|
|
|
|
$
|
467,950
|
|
|
$
|
|
|
|
$
|
|
|
|
$
|
467,950
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of operations
|
|
|
16
|
|
|
|
318,047
|
|
|
|
5
|
|
|
|
|
|
|
|
318,068
|
|
General and administration
|
|
|
576
|
|
|
|
59,677
|
|
|
|
11
|
|
|
|
|
|
|
|
60,264
|
|
Depreciation and amortization
|
|
|
1,568
|
|
|
|
56,850
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
58,415
|
|
Asset impairment charge
|
|
|
|
|
|
|
40,746
|
|
|
|
|
|
|
|
|
|
|
|
40,746
|
|
Legal settlement
|
|
|
1,000
|
|
|
|
359
|
|
|
|
|
|
|
|
|
|
|
|
1,359
|
|
Development project charge
|
|
|
|
|
|
|
131
|
|
|
|
|
|
|
|
|
|
|
|
131
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,160
|
|
|
|
475,810
|
|
|
|
13
|
|
|
|
|
|
|
|
478,983
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
(3,160
|
)
|
|
|
(7,860
|
)
|
|
|
(13
|
)
|
|
|
|
|
|
|
(11,033
|
)
|
|
|
|
|
|
|
Other expense/(income), net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
(39,871
|
)
|
|
|
(34
|
)
|
|
|
|
|
|
|
39,863
|
|
|
|
(42
|
)
|
Interest expense
|
|
|
46,058
|
|
|
|
38,813
|
|
|
|
|
|
|
|
(39,863
|
)
|
|
|
45,008
|
|
Loss (income) from equity method investments
|
|
|
66,832
|
|
|
|
(7
|
)
|
|
|
10,001
|
|
|
|
(66,832
|
)
|
|
|
9,994
|
|
Impairment of equity method investment
|
|
|
|
|
|
|
|
|
|
|
10,680
|
|
|
|
|
|
|
|
10,680
|
|
Loss on debt extinguishment
|
|
|
300
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
300
|
|
Other income
|
|
|
(486
|
)
|
|
|
(377
|
)
|
|
|
|
|
|
|
|
|
|
|
(863
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other expense, net
|
|
|
72,833
|
|
|
|
38,395
|
|
|
|
20,681
|
|
|
|
(66,832
|
)
|
|
|
65,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations before income taxes
|
|
|
(75,993
|
)
|
|
|
(46,255
|
)
|
|
|
(20,694
|
)
|
|
|
66,832
|
|
|
|
(76,110
|
)
|
Provision (benefit) for income taxes
|
|
|
1,593
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,593
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
(77,586
|
)
|
|
|
(46,255
|
)
|
|
|
(20,694
|
)
|
|
|
66,832
|
|
|
|
(77,703
|
)
|
|
|
|
|
|
|
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from discontinued operations, net
|
|
|
|
|
|
|
(614
|
)
|
|
|
|
|
|
|
|
|
|
|
(614
|
)
|
Gain (loss) on disposal of discontinued operations, net of tax
|
|
|
|
|
|
|
725
|
|
|
|
|
|
|
|
|
|
|
|
725
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
(77,586
|
)
|
|
|
(46,144
|
)
|
|
|
(20,694
|
)
|
|
|
66,832
|
|
|
|
(77,592
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net income (loss) attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(6
|
)
|
|
|
|
|
|
|
(6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to common stockholders
|
|
$
|
(77,586
|
)
|
|
$
|
(46,144
|
)
|
|
$
|
(20,688
|
)
|
|
$
|
66,832
|
|
|
$
|
(77,586
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
124
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS)
FISCAL YEAR ENDED APRIL 30, 2014
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Net income (loss)
|
|
$
|
(23,095
|
)
|
|
$
|
23,807
|
|
|
$
|
(9,305
|
)
|
|
$
|
(18,811
|
)
|
|
$
|
(27,404
|
)
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) resulting from changes in fair value of derivative instruments
|
|
|
|
|
|
|
|
|
|
|
(36
|
)
|
|
|
|
|
|
|
(36
|
)
|
Realized loss (gain) on derivative instruments reclassified into earnings
|
|
|
|
|
|
|
|
|
|
|
655
|
|
|
|
|
|
|
|
655
|
|
Unrealized gain (loss) resulting from changes in fair value of marketable securities
|
|
|
|
|
|
|
12
|
|
|
|
|
|
|
|
|
|
|
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
12
|
|
|
|
619
|
|
|
|
|
|
|
|
631
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
|
|
(23,095
|
)
|
|
|
23,819
|
|
|
|
(8,686
|
)
|
|
|
(18,811
|
)
|
|
|
(26,773
|
)
|
|
|
|
|
|
|
Less: Comprehensive income (loss) attributable to noncontrolling interests
|
|
|
|
|
|
|
|
|
|
|
(4,309
|
)
|
|
|
|
|
|
|
(4,309
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss) attributable to common stockholders
|
|
$
|
(23,095
|
)
|
|
$
|
23,819
|
|
|
$
|
(4,377
|
)
|
|
$
|
(18,811
|
)
|
|
$
|
(22,464
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
125
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS)
FISCAL YEAR ENDED APRIL 30, 2013
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Net income (loss)
|
|
$
|
(54,142
|
)
|
|
$
|
(19,954
|
)
|
|
$
|
(5,090
|
)
|
|
$
|
24,723
|
|
|
$
|
(54,463
|
)
|
Other comprehensive income (loss), net of taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) resulting from changes in fair value of derivative instruments, net of tax
|
|
|
(1,257
|
)
|
|
|
|
|
|
|
(1,653
|
)
|
|
|
|
|
|
|
(2,910
|
)
|
Realized loss (gain) on derivative instruments reclassified into earnings, net of tax
|
|
|
3,626
|
|
|
|
|
|
|
|
621
|
|
|
|
|
|
|
|
4,247
|
|
Unrealized gain (loss) resulting from changes in fair value of marketable securities
|
|
|
|
|
|
|
23
|
|
|
|
|
|
|
|
|
|
|
|
23
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
2,369
|
|
|
|
23
|
|
|
|
(1,032
|
)
|
|
|
|
|
|
|
1,360
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
|
|
(51,773
|
)
|
|
|
(19,931
|
)
|
|
|
(6,122
|
)
|
|
|
24,723
|
|
|
|
(53,103
|
)
|
Less: Comprehensive income (loss) attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(321
|
)
|
|
|
|
|
|
|
(321
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss) attributable to common stockholders
|
|
$
|
(51,773
|
)
|
|
$
|
(19,931
|
)
|
|
$
|
(5,801
|
)
|
|
$
|
24,723
|
|
|
$
|
(52,782
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
126
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS)
FISCAL YEAR ENDED APRIL 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Net income (loss)
|
|
$
|
(77,586
|
)
|
|
$
|
(46,144
|
)
|
|
$
|
(20,694
|
)
|
|
$
|
66,832
|
|
|
$
|
(77,592
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) resulting from changes in fair value of derivative instruments, net of tax
|
|
|
(2,253
|
)
|
|
|
|
|
|
|
504
|
|
|
|
|
|
|
|
(1,749
|
)
|
Realized loss (gain) on derivative instruments reclassified into earnings, net of tax
|
|
|
(77
|
)
|
|
|
|
|
|
|
(501
|
)
|
|
|
|
|
|
|
(578
|
)
|
Unrealized gain (loss) resulting from changes in fair value of marketable securities
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
(3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss), net of tax
|
|
|
(2,330
|
)
|
|
|
(3
|
)
|
|
|
3
|
|
|
|
|
|
|
|
(2,330
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
|
|
(79,916
|
)
|
|
|
(46,147
|
)
|
|
|
(20,691
|
)
|
|
|
66,832
|
|
|
|
(79,922
|
)
|
Less: Comprehensive income (loss) attributable to noncontrolling interest
|
|
|
|
|
|
|
|
|
|
|
(6
|
)
|
|
|
|
|
|
|
(6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss) attributable to common stockholders
|
|
$
|
(79,916
|
)
|
|
$
|
(46,147
|
)
|
|
$
|
(20,685
|
)
|
|
$
|
66,832
|
|
|
$
|
(79,916
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
127
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FISCAL YEAR ENDED APRIL 30, 2014
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Net cash provided by (used in) operating activities
|
|
$
|
(40,365
|
)
|
|
$
|
89,792
|
|
|
$
|
215
|
|
|
$
|
|
|
|
$
|
49,642
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions, net of cash acquired
|
|
|
|
|
|
|
(8,305
|
)
|
|
|
|
|
|
|
|
|
|
|
(8,305
|
)
|
Acquisition related additions to property, plant and equipment
|
|
|
|
|
|
|
(2,633
|
)
|
|
|
|
|
|
|
|
|
|
|
(2,633
|
)
|
Additions to property, plant and equipment
|
|
|
(1,675
|
)
|
|
|
(41,236
|
)
|
|
|
(415
|
)
|
|
|
|
|
|
|
(43,326
|
)
|
Payments on landfill operating lease contracts
|
|
|
|
|
|
|
(6,505
|
)
|
|
|
|
|
|
|
|
|
|
|
(6,505
|
)
|
Investments in unconsolidated entities
|
|
|
(2,107
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,107
|
)
|
Proceeds from sale of equity method investment
|
|
|
3,442
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,442
|
|
Proceeds from sale of property and equipment
|
|
|
|
|
|
|
1,524
|
|
|
|
|
|
|
|
|
|
|
|
1,524
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) investing activities
|
|
|
(340
|
)
|
|
|
(57,155
|
)
|
|
|
(415
|
)
|
|
|
|
|
|
|
(57,910
|
)
|
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from long-term borrowings
|
|
|
161,650
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
161,650
|
|
Principal payments on long-term debt
|
|
|
(151,074
|
)
|
|
|
(1,306
|
)
|
|
|
|
|
|
|
|
|
|
|
(152,380
|
)
|
Payments of financing costs
|
|
|
(405
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(405
|
)
|
Proceeds from the exercise of share based awards
|
|
|
|
|
|
|
143
|
|
|
|
|
|
|
|
|
|
|
|
143
|
|
Intercompany borrowings
|
|
|
31,425
|
|
|
|
(31,425
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
41,596
|
|
|
|
(32,588
|
)
|
|
|
|
|
|
|
|
|
|
|
9,008
|
|
Net cash provided by (used in) discontinued operations
|
|
|
|
|
|
|
(31
|
)
|
|
|
|
|
|
|
|
|
|
|
(31
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
891
|
|
|
|
18
|
|
|
|
(200
|
)
|
|
|
|
|
|
|
709
|
|
Cash and cash equivalents, beginning of period
|
|
|
1,260
|
|
|
|
253
|
|
|
|
242
|
|
|
|
|
|
|
|
1,755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$
|
2,151
|
|
|
$
|
271
|
|
|
$
|
42
|
|
|
$
|
|
|
|
$
|
2,464
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
128
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FISCAL YEAR ENDED APRIL 30, 2013
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Net cash provided by (used in) operating activities
|
|
$
|
(5,319
|
)
|
|
$
|
50,527
|
|
|
$
|
(1,302
|
)
|
|
$
|
|
|
|
$
|
43,906
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions, net of cash acquired
|
|
|
|
|
|
|
(25,225
|
)
|
|
|
|
|
|
|
|
|
|
|
(25,225
|
)
|
Acquisition related additions to property, plant and equipment
|
|
|
|
|
|
|
(1,746
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,746
|
)
|
Additions to property, plant and equipment
|
|
|
(203
|
)
|
|
|
(48,058
|
)
|
|
|
(5,020
|
)
|
|
|
|
|
|
|
(53,281
|
)
|
Payments on landfill operating lease contracts
|
|
|
|
|
|
|
(6,261
|
)
|
|
|
|
|
|
|
|
|
|
|
(6,261
|
)
|
Payment for capital related to divestiture
|
|
|
|
|
|
|
(618
|
)
|
|
|
|
|
|
|
|
|
|
|
(618
|
)
|
Investments in unconsolidated entities
|
|
|
(4,166
|
)
|
|
|
(2,707
|
)
|
|
|
3,666
|
|
|
|
|
|
|
|
(3,207
|
)
|
Proceeds from sale of property and equipment
|
|
|
|
|
|
|
883
|
|
|
|
|
|
|
|
|
|
|
|
883
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) investing activities
|
|
|
(4,369
|
)
|
|
|
(83,732
|
)
|
|
|
(1,354
|
)
|
|
|
|
|
|
|
(89,455
|
)
|
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from long-term borrowings
|
|
|
334,497
|
|
|
|
41,849
|
|
|
|
|
|
|
|
|
|
|
|
376,346
|
|
Principal payments on long-term debt
|
|
|
(359,342
|
)
|
|
|
(1,516
|
)
|
|
|
|
|
|
|
|
|
|
|
(360,858
|
)
|
Change in restricted cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payment of tender premium on second lien notes
|
|
|
(10,743
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(10,743
|
)
|
Net proceeds from the issuance of class A common stock
|
|
|
42,184
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
42,184
|
|
Contributions from nonctonrolling interest holder
|
|
|
|
|
|
|
|
|
|
|
2,531
|
|
|
|
|
|
|
|
2,531
|
|
Other
|
|
|
(4,513
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,513
|
)
|
Intercompany borrowings
|
|
|
5,066
|
|
|
|
(5,066
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
7,149
|
|
|
|
35,267
|
|
|
|
2,531
|
|
|
|
|
|
|
|
44,947
|
|
Discontinued Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) discontinued operations
|
|
|
|
|
|
|
(2,177
|
)
|
|
|
|
|
|
|
|
|
|
|
(2,177
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
(2,539
|
)
|
|
|
(115
|
)
|
|
|
(125
|
)
|
|
|
|
|
|
|
(2,779
|
)
|
Cash and cash equivalents, beginning of period
|
|
|
3,799
|
|
|
|
368
|
|
|
|
367
|
|
|
|
|
|
|
|
4,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$
|
1,260
|
|
|
$
|
253
|
|
|
$
|
242
|
|
|
$
|
|
|
|
$
|
1,755
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
129
CASELLA WASTE SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FISCAL YEAR ENDED APRIL 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
|
|
|
Guarantors
|
|
|
Non-
Guarantors
|
|
|
Elimination
|
|
|
Consolidated
|
|
Net cash provided by (used in) operating activities
|
|
$
|
4,552
|
|
|
$
|
59,088
|
|
|
$
|
531
|
|
|
$
|
|
|
|
$
|
64,171
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions, net of cash acquired
|
|
|
|
|
|
|
(2,102
|
)
|
|
|
|
|
|
|
|
|
|
|
(2,102
|
)
|
Acquisition related additions to property, plant and equipment
|
|
|
|
|
|
|
(529
|
)
|
|
|
|
|
|
|
|
|
|
|
(529
|
)
|
Additions to property, plant and equipment
|
|
|
(574
|
)
|
|
|
(54,681
|
)
|
|
|
(2,579
|
)
|
|
|
|
|
|
|
(57,834
|
)
|
Payments on landfill operating lease contracts
|
|
|
|
|
|
|
(6,616
|
)
|
|
|
|
|
|
|
|
|
|
|
(6,616
|
)
|
Investments in unconsolidated entities
|
|
|
(2,740
|
)
|
|
|
(4,184
|
)
|
|
|
1,879
|
|
|
|
|
|
|
|
(5,045
|
)
|
Proceeds from sale of property and equipment
|
|
|
|
|
|
|
1,492
|
|
|
|
|
|
|
|
|
|
|
|
1,492
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) investing activities
|
|
|
(3,314
|
)
|
|
|
(66,620
|
)
|
|
|
(700
|
)
|
|
|
|
|
|
|
(70,634
|
)
|
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from long-term borrowings
|
|
|
163,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
163,500
|
|
Principal payments on long-term debt
|
|
|
(151,390
|
)
|
|
|
(1,416
|
)
|
|
|
|
|
|
|
|
|
|
|
(152,806
|
)
|
Payments of financing costs
|
|
|
(1,592
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,592
|
)
|
Contributions from nonctonrolling interest holder
|
|
|
|
|
|
|
|
|
|
|
536
|
|
|
|
|
|
|
|
536
|
|
Other
|
|
|
591
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
591
|
|
Intercompany borrowings
|
|
|
(10,079
|
)
|
|
|
10,079
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
|
1,030
|
|
|
|
8,663
|
|
|
|
536
|
|
|
|
|
|
|
|
10,229
|
|
Net cash provided by (used in) discontinued operations
|
|
|
|
|
|
|
(1,049
|
)
|
|
|
|
|
|
|
|
|
|
|
(1,049
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
|
2,268
|
|
|
|
82
|
|
|
|
367
|
|
|
|
|
|
|
|
2,717
|
|
Cash and cash equivalents, beginning of period
|
|
|
1,531
|
|
|
|
286
|
|
|
|
|
|
|
|
|
|
|
|
1,817
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$
|
3,799
|
|
|
$
|
368
|
|
|
$
|
367
|
|
|
$
|
|
|
|
$
|
4,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
130