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Basis of Presentation (Policies)
 9 Months Ended
Sep. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]  
Foreign Currency Transactions and Translations

Foreign Currency Transactions and Translation: Through the acquisitions of Layne and LiquiForce, we now have operations in Latin America, Canada and Brazil which involve exposure to possible volatile movements in foreign currency exchange rates. We account for foreign currency exchange transactions and translation in accordance with ASC Topic 830, Foreign Currency Matters. In Mexico, most of our customer contracts are denominated in U.S. dollars; therefore, the functional currency is U.S. dollars. In Canada and Brazil, the functional currency is the local currency. Foreign currency transactions are remeasured into the functional currency with gains and losses included in other income, net in the condensed consolidated statements of operations. The impact from foreign currency transactions was immaterial for both the three and nine months ended September 30, 2018. Assets and liabilities in functional currency are translated into U.S. dollars at exchange rates prevailing at the balance sheet date. Revenues and expenses are translated into U.S. dollars at average foreign currency exchange rates prevailing during the reporting periods. The translation adjustments from functional currency to U.S. dollars are reported in accumulated other comprehensive income on the condensed consolidated balance sheets.
Cash, Cash Equivalents and Restricted Cash

Cash, Cash Equivalents and Restricted Cash: In connection with the acquisition of Layne, we acquired restricted cash which is included in other noncurrent assets in the condensed consolidated balance sheets and consists of escrow funds and judicial deposits associated with tax related legal proceedings in Brazil. The table below presents changes in cash, cash equivalents and restricted cash on the condensed consolidated statements of cash flows and a reconciliation to the amounts reported in the condensed consolidated balance sheets (in thousands).

 

Nine Months Ended September 30,

 

2018

 

 

2017

 

Cash and cash equivalents, beginning of period

 

$

233,711

 

 

$

189,326

 

End of the period

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

230,259

 

 

 

185,516

 

Restricted cash

 

 

5,599

 

 

 

—

 

Total cash, cash equivalents and restricted cash, end of period

 

 

235,858

 

 

 

185,516

 

Net increase (decrease) in cash, cash equivalents and restricted cash

 

$

2,147

 

 

$

(3,810

)

 
Inventories

Inventories: Inventories consist primarily of quarry products, contract-specific materials, water well drilling materials, and sewer remediation materials that are located in the U.S. and mineral extraction and drilling supplies located in the U.S. and foreign countries, primarily Brazil and Mexico. Cost of U.S. and foreign inventories are valued at the lower of average cost or net realizable value. We reserve quarry products based on estimated quantities of materials on hand in excess of approximately one year of demand. As of September 30, 2018, inventory included $18.4 million of supplies related to the Water and Mineral Services operating group.

Assets Held for Sale

Assets Held for Sale: During the three months ended September 30, 2018, management approved the plan to sell certain non-core assets and the associated liabilities related to the water delivery business within our Water and Mineral Services operating group. We expect to complete the sale of the assets during the fourth quarter of 2018. The reclassification of the related assets of the disposal group includes approximately $41.8 million of property, plant and equipment and goodwill of $13.5 million.
Recent Developments

Recent Developments: During the three months ended September 30, 2018, we revised our reportable segments, which are the same as our operating segments, as a result of a change in how our chief operating decision maker (our Chief Executive Officer) regularly reviews financial information to allocate resources and assess performance. This change is consistent with our strategic, end-market diversification strategy. Our new reportable segments which correspond to this end-market focus are: Transportation, Water, Specialty and Materials. The end-market segments Transportation, Water and Specialty replace the Construction and Large Project Construction reportable segments with the composition of our Materials segment remaining unchanged except for the addition of certain material production activity related to the acquisition of Layne. Prior-year information has been recast to reflect this change. See Note 19 for further information regarding our reportable segments.
Goodwill

Goodwill: As a result of the change in our reportable segments, we reassessed our reporting units and have determined we have eight reporting units in which goodwill was recorded as follows:

 

•

Midwest Group Transportation

 

•

Midwest Group Specialty

 

•

Northwest Group Transportation

 

•

Northwest Group Materials

 

•

California Group Transportation

 

•

Water and Mineral Services Group Water

 

•

Water and Mineral Services Group Specialty

 

•

Water and Mineral Services Group Materials

Goodwill was reallocated to these reporting units based on their relative fair values. The following table presents the goodwill balance by reportable segment:

 

(in thousands)

 

September 30,

2018

 

 

December 31,

2017

 

 

September 30,

2017

 

Transportation

 

$

19,798

 

 

$

19,798

 

 

$

19,798

 

Water

 

 

135,230

 

 

 

618

 

 

 

618

 

Specialty

 

 

39,821

 

 

 

31,437

 

 

 

31,437

 

Materials

 

 

49,847

 

 

 

1,946

 

 

 

1,946

 

Total goodwill

 

$

244,696

 

 

$

53,799

 

 

$

53,799

 

 

We perform our goodwill impairment tests annually as of November 1 and more frequently when events and circumstances occur that indicate a possible impairment of goodwill. In addition, we evaluate goodwill 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 factors 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.

Due to the change in reportable segments and the resulting change to reporting units, we conducted an impairment test both before and after the change in accordance with ASC Topic 350, Intangibles - Goodwill and Other. We performed a quantitative assessment on the Kenny Large Project Construction and Kenny Construction reporting units, which were most susceptible to fluctuations in results. The results of the quantitative goodwill impairment tests indicated that the estimated fair values of these reporting units exceeded their net book values (i.e., cushion) by at least 40%.

We performed a qualitative assessment on the remaining six reporting units with goodwill balances as we determined that it was more likely than not that the fair value of these reporting units was greater than the carrying value consistent with our conclusion in 2017. After assessing the totality of events and circumstances, we determined that it is more likely than not that the fair value of these reporting units were greater than the carrying amounts; therefore, a quantitative goodwill impairment test was not performed.