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Acquisitions | 12 Months Ended
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Dec. 31, 2024
Business Combinations [Abstract] |
Acquisitions | NOTE 5: ACQUISITIONS Aero Turbine, Inc. On August 23, 2024, the Company acquired 100% of the shares of Aero Turbine for a purchase price of approximately $132.0 million, subject to post-closing adjustments, comprised of an initial cash purchase price of $116.8 million and $15.2 million representing the estimated fair value of additional consideration contingently payable based upon the achievement of gross profit in excess of certain gross profit targets for the period from January 1, 2024, to December 31, 2026. The maximum contingent consideration payable from the Company to the seller is $21.0 million. The current portion of the contingent consideration liability is recorded in Accrued and other current liabilities and the non-current portion is recorded in Other non-current liabilities. Aero Turbine is a provider of engine component repair, overhaul services and other engineering services for U.S. and foreign military customers. The results of operations of Aero Turbine have been included in the consolidated financial statements of the Company from August 23, 2024, the closing date of the acquisition. For the year ended December 31, 2024, results of operations included $32.7 million in revenues and $11.3 million in net income, respectively. Aero Turbine is reported within the Component Repair Services segment. The Company has provisionally allocated the purchase price based on the fair values of the assets acquired and liabilities assumed at the Aero Turbine acquisition date as follows:
|  | August 23, 2024 |
|  | (in thousands) |
Cash |  | $ | 2,765 |
Accounts receivable |  |  | 4,066 |
Contract assets |  |  | 12,419 |
Inventories |  |  | 10,213 |
Prepaid expenses and other current assets |  |  | 2,517 |
Property, plant and equipment |  |  | 5,883 |
Operating lease right of use asset |  |  | 999 |
Customer relationships |  |  | 75,000 |
Goodwill |  |  | 53,440 |
Total assets acquired |  |  | 167,302 |
Accounts payable |  |  | 5,353 |
Accrued and other current liabilities |  |  | 7,913 |
Contract liabilities |  |  | 1,205 |
Current portion operating lease liabilities |  |  | 111 |
Income taxes payable |  |  | 4,901 |
Long-term portion operating lease liabilities |  |  | 899 |
Deferred income tax liabilities |  |  | 14,932 |
Total liabilities assumed |  |  | 35,314 |
Net assets acquired |  |  | 131,988 |
Cash acquired |  |  | 2,765 |
Purchase price, net of cash acquired |  | $ | 129,223 |
The fair value s presented were estimated by management. The fair value of the assets acquired includes accounts receivable of $4.1 million, of which all is expected to be collectible. The excess of the cost of acquisition over the fair value of the net tangible assets acquired of $128.4 million has been allocated as $75.0 million of customer relationships and $53.4 million of goodwill. The goodwill recognized is attributable to Aero Turbine’s workforce, market position, quality, customized repairs and reliable turnaround times. Goodwill will not be amortized but will be reviewed annually for impairment. None of the goodwill is expected to be deductible for income tax purposes. Customer relationships are expected to be amortized over 15 years. Acquisition related costs of $1.4 million were incurred for the year ended December 31, 2024. These costs are reported in the Consolidated Statements of Operations as “Acquisition costs”. Such expenses include professional fees and other third-party costs. The following reflects the pro forma impact of the purchase of Aero Turbine on the Company’s results of operations giving effect of the transaction if it had taken place on January 1, 2023:
|  | Year ended December 31, |
|  | 2024 |  |  | 2023 |
| (in thousands) |
| (Unaudited) |
Revenue |  | $ | 5,295,976 |  |  | $ | 4,625,301 |
Net income (loss) |  |  | 26,273 |  |  |  | (26,699 | )
Western Jet Aviation On February 2, 2023, the Company acquired 100% of the shares of Western Jet Aviation, Inc. (“Western Jet”) for a purchase price of approximately $32.7 million. Western Jet is a certified repair station for business jet maintenance, specializing in Gulfstream aircraft, offering maintenance and interior services, plus heavy avionics support on many business aviation aircraft. The results of operations of Western Jet have been included in the consolidated financial statements of the Company from February 2, 2023, the closing date of the acquisition. For the year ended December 31, 2023, results of operations included $34.6 million in revenues and $1.8 million in net income, respective ly. Western Jet is reported within the Engine Services segment. The Company allocated the purchase price based on the fair values of the assets acquired and liabilities assumed at the Western Jet acquisition date as follows:
|  | February 2, 2023 |
|  | (in thousands) |
Cash |  | $ | 1,379 |
Accounts receivable |  |  | 7,022 |
Contract assets |  |  | 4,485 |
Inventories |  |  | 2,543 |
Prepaid expenses and other current assets |  |  | 987 |
Property, plant and equipment |  |  | 2,843 |
Operating lease right of use asset |  |  | 9,013 |
Intangible assets |  |  | 447 |
Goodwill |  |  | 23,493 |
Deferred income taxes |  |  | 2,812 |
Total assets acquired |  |  | 55,024 |
Accounts payable |  |  | 1,845 |
Accrued and other current liabilities |  |  | 3,254 |
Contract liabilities |  |  | 8,220 |
Current portion operating lease liabilities |  |  | 1,072 |
Long-term portion operating lease liabilities |  |  | 7,941 |
Total liabilities assumed |  |  | 22,332 |
Net assets acquired |  |  | 32,692 |
Cash acquired |  |  | 1,379 |
Purchase price, net of cash acquired |  | $ | 31,313 |
The fair values presented were estimated by management. The fair value of the assets acquired included accounts receivable of $7.0 million, the gross amount due under contracts is $7.1 million, of which $0.1 million was expected to be uncollectible. The excess of the cost of acquisition over the fair value of the net tangible assets acquired of $23.5 million has been allocated to goodwill. The goodwill recognized is attributable to Western Jet’s market position, quality, customized repairs and reliable turnaround times. Goodwill will not be amortized but will be reviewed annually for impairment. No ne of the goodwill is expected to be deductible for income tax purposes. Acquisition related costs of $1.5 million were incurred for the year ended December 31, 2023. These costs are reported in the Consolidated Statements of Operations as “Acquisition costs”. Such expenses include professional fees and other third-party costs. The following reflects the pro forma impact of the purchase of Western Jet on the Company’s results of operations giving effect of the transaction if it had taken place on January 1, 2022:
|  | Year ended December 31, |
|  | 2023 |  |  | 2022 |
| (in thousands) |
| (Unaudited) |
Revenue |  | $ | 4,566,423 |  |  | $ | 4,185,887 |
Net loss |  |  | (33,372 | ) |  |  | (22,111 | )
EB Airfoils, LLC On May 12, 2022, the Company acquired 100% of EB Airfoils LLC and Electron Beam Development, LLC (“EB Airfoils”), for total consideration of $19.7 million. EB Airfoils is a leading fan blade, compressor blade and vane maintenance, repair and overhaul provider. The purchase price consisted of $19.5 million in cash and $0.4 million held in escrow for potential post-closing working capital adjustments. The post-closing working capital adjustments were finalized in the second quarter of 2023 resulting in a decrease of the purchase price of $0.2 million. The results of operations of EB Airfoils have been included in the consolidated financial statements of the Company from May 12, 2022, the closing date of the acquisition. For the year ended December 31, 2022, results of operations included $6.4 million in revenues and $0.2 million net income. EB Airfoils is reported within the Component Repair Services segment. The Company allocated the purchase price based on the fair values of the assets acquired and liabilities assumed at the EB Airfoils acquisition date as follows:
|  | May 12, 2022 |
|  | (in thousands) |
Accounts receivable |  | $ | 2,064 |
Inventories |  |  | 133 |
Prepaid expenses and other current assets |  |  | 5 |
Property, plant and equipment |  |  | 1,694 |
Operating lease right of use asset |  |  | 550 |
Goodwill |  |  | 17,209 |
Total assets acquired |  |  | 21,655 |
Accounts payable |  |  | 181 |
Accrued and other current liabilities |  |  | 1,243 |
Current portion operating lease liabilities |  |  | 168 |
Long-term portion operating lease liabilities |  |  | 382 |
Total liabilities assumed |  |  | 1,974 |
Net assets acquired |  |  | 19,681 |
Cash acquired |  |  | — |
Purchase price, net of cash acquired |  | $ | 19,681 |
The fair values were estimated by management. The fair value of the assets acquired includes gross amounts due under contracts of 2.1 million, of which all is expected to be collectible. The excess of the cost of acquisition over the fair value of the net tangible assets acquired of $17.2 million has been allocated to goodwill. The goodwill recognized is attributable to EB Airfoil’s market position, quality, customized repairs and reliable turnaround times. Goodwill will not be amortized but will be reviewed annually for impairment. Goodwill is expected to be amortized over 15 years for income tax purposes. Acquisition related costs of $1.1 million were incurred for the year ended December 31, 2022. These costs are reported in the Consolidated Statements of Operations as “Acquisition related costs”. Such expenses include professional fees and other third-party costs. The following reflects the pro forma impact of the purchase of EB Airfoils on the Company’s results of operations giving effect of the transaction if it had taken place on January 1, 2021:
|  | Year ended December 31, |
|  | 2022 |  |  | 2021 |
|  | (in thousands) |
|  | (Unaudited) |
Revenue |  | $ | 4,153,664 |  |  | $ | 3,490,304 |
Net loss |  |  | (20,660 | ) |  |  | (27,793 | )

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent + Details
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