June 30, 2023
|
December 31,
2022
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
86,330
|
$
|
130,333
|
||||
Accounts receivable:
|
||||||||
Billed, net of allowance of $5,091 and $6,091
|
170,463
|
236,980
|
||||||
Unbilled
|
22,461
|
31,506
|
||||||
Prepaid expenses and other assets
|
33,359
|
34,290
|
||||||
Total current assets
|
312,613
|
433,109
|
||||||
Property and equipment, net
|
77,121
|
81,145
|
||||||
Operating lease right-of-use assets
|
200,249
|
210,480
|
||||||
Other assets
|
||||||||
Goodwill
|
529,727
|
531,385
|
||||||
Intangible assets, net
|
769,450
|
792,935
|
||||||
Other
|
13,401
|
14,820
|
||||||
Total other assets
|
1,312,578
|
1,339,140
|
||||||
Total assets
|
$
|
1,902,561
|
$
|
2,063,874
|
||||
LIABILITIES AND MEMBERS’ EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
31,068
|
$
|
80,890
|
||||
Accrued expenses and other
|
69,108
|
100,843
|
||||||
Current portion of long-term debt
|
16,837
|
16,563
|
||||||
Current portion of contingent consideration
|
65,621
|
71,395
|
||||||
Current portion of operating lease liabilities
|
39,968
|
42,499
|
||||||
Total current liabilities
|
222,602
|
312,190
|
||||||
Long-term debt, less current portion
|
1,406,673
|
1,347,132
|
||||||
Operating lease liabilities, less current portion
|
184,566
|
189,023
|
||||||
Contingent consideration liability, less current portion
|
1,284
|
25,254
|
||||||
Deferred income taxes
|
25,540
|
25,554
|
||||||
Other long-term liabilities
|
2,860
|
2,862
|
||||||
Total liabilities
|
1,843,525
|
1,902,015
|
||||||
Commitments and contingencies (Note 7)
|
||||||||
Members’ equity
|
153,272
|
152,984
|
||||||
Accumulated other comprehensive loss
|
(4,783
|
)
|
(4,492
|
)
|
||||
Retained earnings
|
(89,453
|
)
|
13,367
|
|||||
Total members’ equity
|
59,036
|
161,859
|
||||||
Total liabilities and members’ equity
|
$
|
1,902,561
|
$
|
2,063,874
|
Six Months Ended June 30,
|
||||||||
2023
|
2022
|
|||||||
Operating revenue
|
$
|
682,442
|
$
|
927,932
|
||||
Operating expenses:
|
||||||||
Purchased transportation costs
|
409,572
|
635,136
|
||||||
Selling, general and administrative
|
251,804
|
208,378
|
||||||
Change in fair value of contingent consideration
|
12,320
|
7,299
|
||||||
Depreciation and amortization
|
32,262
|
23,313
|
||||||
Total operating expenses
|
705,958
|
874,126
|
||||||
Income (loss) from operations
|
(23,516
|
)
|
53,806
|
|||||
Other expense:
|
||||||||
Interest expense, net
|
(79,345
|
)
|
(35,817
|
)
|
||||
Other income
|
607
|
715
|
||||||
Foreign exchange gain (loss)
|
(1,240
|
)
|
3,603
|
|||||
Total other expense
|
(79,978
|
)
|
(31,499
|
)
|
||||
Income (loss) before income taxes
|
(103,494
|
)
|
22,307
|
|||||
Income tax benefit (expense)
|
674
|
(3,301
|
)
|
|||||
Net income (loss)
|
$
|
(102,820
|
)
|
$
|
19,006
|
|||
Other comprehensive income (loss)
|
||||||||
Foreign currency translation adjustment
|
(291
|
)
|
(5,248
|
)
|
||||
Comprehensive income (loss)
|
$
|
(103,111
|
)
|
$
|
13,758
|
Accumulated Other Comprehensive
Loss
|
Retained Earnings
|
Members’
Equity
|
||||||||||
Balance, January 1, 2023
|
$
|
(4,492
|
)
|
$
|
13,367
|
$
|
161,859
|
|||||
Issuance of member units
|
-
|
-
|
288
|
|||||||||
Net loss
|
-
|
(102,820
|
)
|
(102,820
|
)
|
|||||||
Foreign currency translation loss
|
(291
|
)
|
-
|
(291
|
)
|
|||||||
Balance, June 30, 2023
|
$
|
(4,783
|
)
|
$
|
(89,453
|
)
|
$
|
59,036
|
Accumulated Other Comprehensive
Loss
|
Retained Earnings
|
Members’
Equity
|
||||||||||
Balance, January 1, 2022
|
$
|
(105
|
)
|
$
|
(2,632
|
)
|
$
|
375,494
|
||||
Issuance of member units
|
-
|
-
|
7,863
|
|||||||||
Member distributions
|
-
|
-
|
(227,569
|
)
|
||||||||
Net income
|
-
|
19,006
|
19,006
|
|||||||||
Foreign currency translation loss
|
(5,248
|
)
|
-
|
(5,248
|
)
|
|||||||
Balance, June 30, 2022
|
$
|
(5,353
|
)
|
$
|
16,374
|
$
|
169,546
|
Six Months Ended June 30,
|
||||||||
2023
|
2022
|
|||||||
Operating Activities
|
||||||||
Net income (loss)
|
$
|
(102,820
|
)
|
$
|
19,006
|
|||
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
|
||||||||
Depreciation and amortization
|
32,262
|
23,313
|
||||||
Amortization of deferred financing costs
|
3,618
|
2,579
|
||||||
Change in fair value of contingent consideration
|
12,320
|
7,299
|
||||||
Other operating activities
|
219
|
3,248
|
||||||
Changes in operating assets and liabilities, net of effects of business acquisitions:
|
||||||||
Accounts receivable
|
75,214
|
101,903
|
||||||
Prepaid and other assets
|
2,585
|
(16,927
|
)
|
|||||
Accounts payable
|
(48,601
|
)
|
(22,480
|
)
|
||||
Accrued expenses and other liabilities
|
(22,006
|
)
|
(43,854
|
)
|
||||
Contingent consideration paid
|
(7,229
|
)
|
-
|
|||||
Net cash (used in) provided by operating activities
|
(54,438
|
)
|
74,087
|
|||||
Investing activities
|
||||||||
Cash paid for acquisitions; net of cash acquired
|
250
|
(36,710
|
)
|
|||||
Purchase of property and equipment and other investing
|
(4,925
|
)
|
(15,196
|
)
|
||||
Net cash used in investing activities
|
(4,675
|
)
|
(51,906
|
)
|
||||
Financing activities
|
||||||||
Proceeds from long-term debt
|
64,000
|
320,000
|
||||||
Repayments of long-term debt
|
(6,051
|
)
|
(4,838
|
)
|
||||
Repayments of revolving line of credit
|
-
|
(20,000
|
)
|
|||||
Repayments of finance lease obligations
|
(2,101
|
)
|
(1,227
|
)
|
||||
Payment of debt issuance costs
|
(511
|
)
|
(12,372
|
)
|
||||
Cash paid to settle contingent consideration
|
(33,981
|
)
|
-
|
|||||
Cash received from member issuances
|
-
|
600
|
||||||
Purchase of member units
|
-
|
(1,885
|
)
|
|||||
Member distributions
|
(7,439
|
)
|
(208,469
|
)
|
||||
Net cash provided by financing activities
|
13,917
|
71,809
|
||||||
Effect of exchange rate changes on cash and cash equivalents
|
1,193
|
(2,162
|
)
|
|||||
Net increase (decrease) in cash and cash equivalents
|
(44,003
|
)
|
91,828
|
|||||
Cash and cash equivalents - beginning of period
|
130,333
|
37,004
|
||||||
Cash and cash equivalents - end of period
|
$
|
86,330
|
$
|
128,832
|
||||
Supplemental cash flow information
|
||||||||
Cash paid for interest
|
$
|
76,036
|
$
|
33,156
|
1. |
Nature of Operations
|
2. |
Basis of Presentation
|
3. |
Acquisitions
|
LiVe
|
AGW
|
Total
|
||||||||||
Cash consideration (a)
|
$
|
38,055
|
$
|
108,664
|
$
|
146,719
|
||||||
Working capital adjustment due from seller
|
-
|
(6,801
|
)
|
(6,801
|
)
|
|||||||
Equity units
|
4,462
|
5,247
|
9,709
|
|||||||||
Contingent consideration
|
11,400
|
21,300
|
32,700
|
|||||||||
Total
|
$
|
53,917
|
$
|
128,410
|
$
|
182,327
|
||||||
Less: cash acquired
|
(1,345
|
)
|
(12,815
|
)
|
(14,160
|
)
|
||||||
Total consideration
|
$
|
52,572
|
$
|
115,595
|
$
|
168,167
|
(a) |
Cash consideration for LiVe includes post-close amounts received.
|
LiVe
|
AGW
|
Total
|
||||||||||
Accounts receivable
|
$
|
7,864
|
$
|
26,886
|
$
|
34,750
|
||||||
Prepaid and other current assets
|
378
|
1,968
|
2,346
|
|||||||||
Right of use asset
|
75
|
9,446
|
9,521
|
|||||||||
Property and equipment
|
435
|
2,712
|
3,147
|
|||||||||
Other noncurrent assets
|
-
|
652
|
652
|
|||||||||
Goodwill
|
7,156
|
37,137
|
44,293
|
|||||||||
Intangible assets – customer relationships
|
42,600
|
86,400
|
129,000
|
|||||||||
Intangible assets – trade names
|
1,000
|
2,000
|
3,000
|
|||||||||
Total assets
|
$
|
59,508
|
$
|
167,201
|
$
|
226,709
|
||||||
Accounts payable
|
$
|
5,642
|
$
|
9,764
|
$
|
15,406
|
||||||
Income tax payable
|
-
|
5,610
|
5,610
|
|||||||||
Accrued expenses
|
1,219
|
4,127
|
5,346
|
|||||||||
Lease liabilities, current
|
69
|
1,698
|
1,767
|
|||||||||
Deferred income taxes, current
|
-
|
17,147
|
17,147
|
|||||||||
Other current liabilities
|
-
|
4,129
|
4,129
|
|||||||||
Lease liabilities, long-term
|
-
|
375
|
375
|
|||||||||
Other long-term liabilities
|
6
|
8,756
|
8,762
|
|||||||||
Total liabilities
|
$
|
6,936
|
$
|
51,606
|
$
|
58,542
|
||||||
Net assets acquired
|
$
|
52,572
|
$
|
115,595
|
$
|
168,167
|
4. |
Goodwill
|
June 30,
2023
|
December 31, 2022
|
|||||||
Goodwill – beginning balance
|
$
|
531,385
|
$
|
485,586
|
||||
Goodwill additions – business combinations (Note 3)
|
-
|
44,293
|
||||||
Foreign currency translation
|
(1,658
|
)
|
-
|
|||||
Measurement period adjustments
|
-
|
1,506
|
||||||
Goodwill – ending balance
|
$
|
529,727
|
$
|
531,385
|
5. |
Intangible Assets
|
June 30, 2023
|
||||||||||||||||
Weighted Average Useful Life
in Years
|
Gross Carrying Amount
|
Accumulated Amortization
|
Net Carrying Amount
|
|||||||||||||
Customer relationships
|
16.0
|
$
|
765,815
|
$
|
(86,604
|
)
|
$
|
679,211
|
||||||||
Internally developed software
|
3.1
|
1,600
|
(597
|
)
|
1,003
|
|||||||||||
Trade names - finite-lived
|
1.0
|
9,500
|
(7,664
|
)
|
1,836
|
|||||||||||
Trade names - indefinite-lived
|
87,400
|
-
|
87,400
|
|||||||||||||
Total intangible assets
|
$
|
864,315
|
$
|
(94,865
|
)
|
$
|
769,450
|
December 31, 2022
|
||||||||||||||||
Weighted Average Useful Life
in Years
|
Gross Carrying Amount
|
Accumulated Amortization
|
Net Carrying Amount
|
|||||||||||||
Customer relationships
|
16.5
|
$
|
766,081
|
$
|
(65,490
|
)
|
$
|
700,591
|
||||||||
Internally developed software
|
3.6
|
1,600
|
(437
|
)
|
1,163
|
|||||||||||
Trade names - finite-lived
|
1.2
|
9,500
|
(5,719
|
)
|
3,781
|
|||||||||||
Trade names - indefinite-lived
|
87,400
|
-
|
87,400
|
|||||||||||||
Total intangible assets
|
$
|
864,581
|
$
|
(71,646
|
)
|
$
|
792,935
|
Remainder of 2023
|
$
|
22,830
|
||
2024
|
44,117
|
|||
2025
|
43,325
|
|||
2026
|
43,208
|
|||
2027
|
43,005
|
|||
Thereafter
|
485,565
|
|||
$
|
682,050
|
6. |
Long-Term Debt
|
June 30, 2023
|
December 31, 2022
|
|||||||
Term loan
|
$
|
1,190,159
|
$
|
1,132,210
|
||||
Subordinated term loan
|
245,000
|
245,000
|
||||||
Finance leases of equipment
|
14,348
|
15,590
|
||||||
Total debt
|
1,449,507
|
1,392,800
|
||||||
Deferred financing costs, net
|
(25,997
|
)
|
(29,105
|
)
|
||||
Total debt
|
1,423,510
|
1,363,695
|
||||||
Less: current portion
|
(16,837
|
)
|
(16,563
|
)
|
||||
Total long-term debt, net of current portion
|
$
|
1,406,673
|
$
|
1,347,132
|
Remainder of 2023
|
$
|
6,052
|
||
2024
|
12,102
|
|||
2025
|
12,102
|
|||
2026
|
1,159,903
|
|||
2027
|
245,000
|
|||
Thereafter
|
-
|
|||
$
|
1,435,159
|
7. |
Commitments and Contingencies
|
8. |
Fair Value of Financial Instruments
|
Balance at January 1, 2023
|
$
|
96,649
|
||
Fair value changes included in change in fair value of contingent consideration liability
|
12,320
|
|||
Payments of contingent consideration
|
(42,064
|
)
|
||
Balance at June 30, 2023
|
$
|
66,905
|
9. |
Income Taxes
|
10. |
Related Parties
|
11. |
Subsequent Events
|