EPIQ SYSTEMS INC

CIK:0001027207|SEC Filings

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenue:
Operating revenue	$ 130,647	$ 130,557	$ 262,175	$ 238,312
Reimbursable expenses	10,097	7,453	25,100	18,726
Total revenue	140,744	138,010	287,275	257,038
Operating Expense:
Direct cost of operating revenue (exclusive of depreciation and amortization shown separately below)	64,216	67,901	129,369	118,930
Reimbursable expenses	9,250	7,290	24,158	17,794
Selling, general and administrative expense	47,299	44,773	95,041	83,837
Depreciation and software and leasehold amortization	10,084	9,498	19,618	18,263
Amortization of identifiable intangible assets	3,680	4,810	7,454	7,495
Impairment of goodwill and identifiable intangible assets		1,162		1,162
Fair value adjustment to contingent consideration		(1,201)		(1,201)
Other operating expense		2,861	53	2,998
Total operating expense	134,529	137,094	275,693	249,278
Operating income	6,215	916	11,582	7,760
Interest expense (income):
Interest expense	5,458	5,480	10,866	9,709
Interest income	(1)	(1)	(34)	(5)
Net interest expense	5,457	5,479	10,832	9,704
Income (loss) before income taxes	758	(4,563)	750	(1,944)
Income tax expense (benefit)	6,338	(1,322)	6,395	(436)
Net loss	$ (5,580)	$ (3,241)	$ (5,645)	$ (1,508)
Net loss per common share:
Basic (in dollars per share)	$ (0.15)	$ (0.09)	$ (0.15)	$ (0.04)
Diluted (in dollars per share)	$ (0.15)	$ (0.09)	$ (0.15)	$ (0.04)
Weighted average common shares outstanding:
Basic (in shares)	37,432	36,536	37,250	36,409
Diluted (in shares)	37,432	36,536	37,250	36,409
Cash dividends declared per common share (in dollars per share)	$ 0.09	$ 0.09	$ 0.18	$ 0.18

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Net cash provided by operating activities	$ 2,873	$ 27,931
Cash flows from investing activities:
Cash paid for business acquisitions, net of cash acquired		(123,649)
Purchase of property and equipment	(8,234)	(11,710)
Internally developed software costs	(4,848)	(4,620)
Cash proceeds from sale of assets	459	108
Net cash used in investing activities	(12,623)	(139,871)
Cash flows from financing activities:
Proceeds from revolver borrowings	31,000	23,000
Repayment of revolver borrowings	(13,000)	(5,000)
Proceeds from borrowings of long-term debt		75,000
Repayment of long-term debt and other long-term obligations	(6,343)	(5,357)
Debt issuance costs		(1,644)
Payment of acquisition-related liabilities		(29)
Excess tax benefit related to share-based compensation		390
Common stock repurchases	(4,876)	(4,017)
Cash dividends paid	(6,765)	(6,629)
Proceeds from exercise of stock options	47	1,128
Net cash provided by financing activities	63	76,842
Effect of exchange rate changes on cash	(637)	(212)
Net decrease in cash and cash equivalents	(10,324)	(35,310)
Cash and cash equivalents at beginning of period	27,620	54,226
Cash and cash equivalents at end of period	17,296	18,916
Supplemental disclosure of cash flow information:
Cash paid for interest	10,070	7,718
Cash paid (recovered) for income taxes, net	1,557	(1,643)
Non-cash investing and financing transactions:
Property, equipment, and leasehold improvements and software development accrued in accounts payable	5,684	1,651
Capital expenditures funded by capital lease borrowings		1,583
Capital leases assumed		9,061
Dividends declared	$ 3,459	$ 3,420

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current Assets:
Cash and cash equivalents	$ 17,296	$ 27,620
Trade accounts receivable, net	167,457	140,597
Prepaid expenses	16,536	20,206
Income taxes receivable	8,173	8,421
Other current assets	817	199
Total current assets	210,279	197,043
Long-term Assets:
Property and equipment, net	70,329	77,715
Internally developed software, net	17,375	15,971
Goodwill	476,973	477,479
Other intangible assets, net	37,489	44,943
Other long-term assets	10,112	10,746
Total long-term assets	612,278	626,854
Total Assets	822,557	823,897
Current Liabilities:
Accounts payable	25,298	28,704
Current maturities of long-term obligations	11,917	12,213
Accrued compensation	16,478	23,977
Client deposits	1,130	3,593
Deferred revenue	3,962	3,669
Dividends payable	3,750	3,599
Other accrued expenses	13,602	9,144
Total current liabilities	76,137	84,899
Long-term Liabilities:
Deferred income taxes	49,891	47,036
Other long-term liabilities	13,974	12,476
Long-term obligations	383,863	371,365
Total long-term liabilities	447,728	430,877
Commitments and contingencies
Equity:
Preferred stock-$1 par value; 2,000,000 shares authorized; none issued and outstanding
Common stock-$0.01 par value; authorized 100,000,000 shares; issued and outstanding June 30, 2016-40,835,651 and 37,944,698 shares, respectively; issued and outstanding December 31, 2015-40,835,651 and 37,534,447 shares, respectively	408	408
Additional paid-in capital	297,686	296,324
Accumulated other comprehensive loss	(11,793)	(7,949)
Retained earnings	50,518	62,991
Treasury stock, at cost-2,890,953 shares and 3,301,204 shares, respectively	(38,127)	(43,653)
Total equity	298,692	308,121
Total Liabilities and Equity	$ 822,557	$ 823,897