Company Quick10K Filing
GP Strategies
Price13.41 EPS0
Shares17 P/E37
MCap227 P/FCF50
Net Debt105 EBIT14
TEV333 TEV/EBIT24
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-03-31 Filed 2020-05-11
10-K 2019-12-31 Filed 2020-03-10
10-Q 2019-09-30 Filed 2019-11-07
10-Q 2019-06-30 Filed 2019-08-02
10-Q 2019-03-31 Filed 2019-05-10
10-K 2018-12-31 Filed 2019-04-01
10-Q 2018-09-30 Filed 2018-11-06
10-Q 2018-06-30 Filed 2018-08-01
10-Q 2018-03-31 Filed 2018-05-03
10-K 2017-12-31 Filed 2018-03-01
10-Q 2017-09-30 Filed 2017-11-02
10-Q 2017-06-30 Filed 2017-07-27
10-Q 2017-03-31 Filed 2017-05-02
10-K 2016-12-31 Filed 2017-02-28
10-Q 2016-09-30 Filed 2016-11-01
10-Q 2016-06-30 Filed 2016-07-28
10-Q 2016-03-31 Filed 2016-04-28
10-K 2015-12-31 Filed 2016-02-25
10-Q 2015-09-30 Filed 2015-10-29
10-Q 2015-06-30 Filed 2015-07-30
10-Q 2015-03-31 Filed 2015-05-05
10-K 2014-12-31 Filed 2015-02-24
10-Q 2014-09-30 Filed 2014-10-30
10-Q 2014-06-30 Filed 2014-07-31
10-Q 2014-03-31 Filed 2014-05-01
10-K 2013-12-31 Filed 2014-02-28
10-Q 2013-09-30 Filed 2013-10-31
10-Q 2013-06-30 Filed 2013-08-01
10-Q 2013-03-31 Filed 2013-05-02
10-K 2012-12-31 Filed 2013-02-26
10-Q 2012-09-30 Filed 2012-11-01
10-Q 2012-06-30 Filed 2012-08-02
10-Q 2012-03-31 Filed 2012-05-03
10-Q 2011-09-30 Filed 2011-11-03
10-Q 2011-06-30 Filed 2011-08-04
10-Q 2011-03-31 Filed 2011-05-05
10-K 2010-12-31 Filed 2011-03-03
10-Q 2010-09-30 Filed 2010-11-04
10-Q 2010-06-30 Filed 2010-08-05
10-Q 2010-03-31 Filed 2010-05-06
10-K 2009-12-31 Filed 2010-03-04
8-K 2020-07-17 Officers
8-K 2020-07-07 Officers
8-K 2020-07-01 Officers, Exhibits
8-K 2020-06-09
8-K 2020-05-11
8-K 2020-05-07
8-K 2020-03-26
8-K 2020-03-10
8-K 2020-01-10
8-K 2020-01-08
8-K 2019-11-07
8-K 2019-10-31
8-K 2019-08-07
8-K 2019-08-01
8-K 2019-05-15
8-K 2019-05-10
8-K 2019-03-18
8-K 2019-03-15
8-K 2018-11-30
8-K 2018-11-06
8-K 2018-11-06
8-K 2018-08-08
8-K 2018-08-08
8-K 2018-08-02
8-K 2018-07-31
8-K 2018-06-29
8-K 2018-06-20
8-K 2018-05-03
8-K 2018-04-20
8-K 2018-03-06
8-K 2018-03-01

GPX 10Q Quarterly Report

Part I. Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosure About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 6. Exhibits
EX-31.1 exhibit311-gpx33120.htm
EX-31.2 exhibit312-gpx33120.htm
EX-32.1 exhibit321-gpx33120.htm

GP Strategies Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
4653722791869302012201420172020
Assets, Equity
15011989592902012201420172020
Rev, G Profit, Net Income
35217-7-21-352012201420172020
Ops, Inv, Fin

gpx-20200331
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 10-Q
 
ý Quarterly Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
 
 For the quarterly period ended March 31, 2020
or
 
¨ Transition Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
 
For the transition period from                             to                             
 
Commission File Number 1-7234
 
 GP STRATEGIES CORPORATION
(Exact name of Registrant as specified in its charter)
 
Delaware52-0845774
(State of Incorporation)(I.R.S. Employer Identification No.)
70 Corporate Center 
 
11000 Broken Land Parkway, Suite 200, Columbia, MD21044
(Address of principal executive offices)(Zip Code)
 
(443) 367-9600
Registrant’s telephone number, including area code:
  
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   ý No   ¨
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes   ý No   ¨
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company in Rule 12b-2 of the Exchange Act. 
Large accelerated filer   ¨Accelerated filer   x
Non-accelerated filer   ¨
Smaller reporting company  ¨Emerging growth company  ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12(b)-2 of the Exchange Act). Yes   ¨ No   ý

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01 per shareGPXNYSE (New York Stock Exchange)

The number of shares outstanding of the registrant’s common stock as of April 21, 2020 was as follows:
Class Outstanding 
Common Stock, par value $.01 per share 17,173,072 







GP STRATEGIES CORPORATION AND SUBSIDIARIES
TABLE OF CONTENTS
  Page
Part I.Financial Information
   
Item 1.Financial Statements (Unaudited)
   
 
   
 
  
 
   
 
   
 
   
Item 2.
   
Item 3.
   
Item 4.
   
Part II.
   
Item 1.
   
Item 1A.
   
Item 2.
   
Item 6.
   
 



Part I. Financial Information
Item 1. Financial Statements 
GP STRATEGIES CORPORATION AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except per share amounts)
March 31, 2020 (Unaudited)December 31, 2019
Assets  
Current assets:
Cash $9,025  $8,159  
Accounts and other receivables, less allowance for credit losses of $1,500 in 2020 and $1,132 in 2019
104,195  131,852  
Unbilled revenue60,655  57,229  
Prepaid expenses and other current assets21,306  19,115  
Total current assets195,181  216,355  
Property, plant and equipment23,297  23,746  
Accumulated depreciation(17,789) (17,943) 
Property, plant and equipment, net5,508  5,803  
Operating lease right-of-use assets25,036  27,251  
Goodwill164,812  171,563  
Intangible assets, net14,583  16,344  
Other assets11,474  11,586  
 $416,594  $448,902  
Liabilities and Stockholders’ Equity  
Current liabilities:  
Accounts payable and accrued expenses$75,328  $92,332  
Deferred revenue25,560  23,234  
Current portion of operating lease liabilities7,739  7,871  
Total current liabilities108,627  123,437  
Long-term debt74,837  82,870  
Long-term portion of operating lease liabilities20,776  22,159  
Other noncurrent liabilities9,862  10,522  
Total liabilities214,102  238,988  
Stockholders’ equity:  
Common stock, par value $0.01 per share
172  172  
Additional paid-in capital100,650  102,319  
Retained earnings129,934  131,228  
Treasury stock at cost(1,374) (4,070) 
Accumulated other comprehensive loss(26,890) (19,735) 
Total stockholders’ equity202,492  209,914  
$416,594  $448,902  
 See accompanying notes to condensed consolidated financial statements.
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GP STRATEGIES CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share data)
 
Three Months Ended
March 31,
 20202019
Revenue$128,281  $139,473  
Cost of revenue110,667  118,195  
Gross profit17,614  21,278  
General and administrative expenses17,284  16,127  
Sales and marketing expenses
1,839  1,989  
Restructuring charges
  1,119  
Gain on change in fair value of contingent consideration, net
  50  
Gain on sale of business1,064    
Operating income (loss)(445) 2,093  
Interest expense978  1,598  
Other expense500  14  
Income (loss) before income tax expense(1,923) 481  
Income tax expense (benefit)(629) 147  
Net income (loss)$(1,294) $334  
Basic weighted average shares outstanding17,082  16,672  
Diluted weighted average shares outstanding17,117  16,703  
Per common share data:  
Basic earnings (loss) per share$(0.08) $0.02  
Diluted earnings (loss) per share$(0.08) $0.02  
 
See accompanying notes to condensed consolidated financial statements.
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GP STRATEGIES CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Comprehensive Income (Loss)
(Unaudited)
(In thousands)
 
Three Months Ended
March 31,
 20202019
Net income (loss)$(1,294) $334  
Foreign currency translation adjustments(7,155) 1,713  
Comprehensive income (loss)
$(8,449) $2,047  
 
See accompanying notes to condensed consolidated financial statements.
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GP STRATEGIES CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Stockholders’ Equity
Three Months Ended March 31, 2020 and 2019
(Unaudited)
(In thousands)

Common
stock
Additional
paid-in
capital
Retained
earnings
Treasury
stock
at cost
Accumulated
other
comprehensive
loss
Total
stockholders’
equity
Balance at December 31, 2019172  102,319  131,228  (4,070) (19,735) 209,914  
Net income (loss)—  —  (1,294) —  —  (1,294) 
Foreign currency translation adjustment—  —  —  —  (7,155) (7,155) 
Stock-based compensation expense—  441  —  —  —  441  
Issuance of stock for employer contributions to retirement plan
—  (1,062) —  1,877  —  815  
Net issuances of stock pursuant to stock compensation plans and other
—  (1,048) —  819  —  (229) 
Balance at March 31, 2020$172  $100,650  $129,934  $(1,374) $(26,890) $202,492  


Common stockAdditional paid-in capitalRetained earningsTreasury stock at costAccumulated other comprehensive lossTotal stockholders’ equity
Balance at December 31, 2018172  105,850  116,039  (13,802) (21,690) 186,569  
Net income—  —  334  —  —  334  
Foreign currency translation adjustment—  —  —  —  1,713  1,713  
Stock-based compensation expense—  354  —  —  —  354  
Issuance of stock for employer contributions to retirement plan—  (421) —  1,156  —  735  
Net issuances of stock pursuant to stock compensation plans and other—  (874) —  883  —  9  
Balance at March 31, 2019172  104,909  116,373  (11,763) (19,977) 189,714  

See accompanying notes to condensed consolidated financial statements.


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GP STRATEGIES CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
Three Months Ended March 31, 2020 and 2019
(Unaudited, in thousands)
 20202019
Cash flows from operating activities:  
Net income (loss)$(1,294) $334  
Adjustments to reconcile net income (loss) to net cash provided by operating activities:  
Gain on change in fair value of contingent consideration, net  (50) 
Gain on sale of business(1,064)   
Depreciation and amortization2,177  2,341  
Deferred income taxes(414) (102) 
Non-cash compensation expense1,256  1,089  
Changes in other operating items:  
Accounts and other receivables25,290  6,104  
Unbilled revenue(5,252) (2,553) 
Prepaid expenses and other current assets(3,602) (5,600) 
Accounts payable, accrued expenses and net change in operating leases(10,917) 498  
Deferred revenue4,429  (5,589) 
Other(762) 923  
Net cash provided by (used in) operating activities9,847  (2,605) 
Cash flows from investing activities:  
Additions to property, plant and equipment(467) (542) 
Proceeds from sale of business3,328    
Capitalized software development costs and other(24) (226) 
Net cash provided by (used in) investing activities2,837  (768) 
Cash flows from financing activities:  
Proceeds from long-term debt62,187  33,038  
Repayment of long-term debt(70,220) (33,000) 
Change in negative cash book balance(3,701) (701) 
Other financing activities(8) (27) 
Net cash used in financing activities(11,742) (690) 
Effect of exchange rate changes on cash and cash equivalents(76) (927) 
Net increase (decrease) in cash866  (4,990) 
Cash at beginning of period8,159  13,417  
Cash at end of period$9,025  $8,427  
Supplemental disclosures of cash flow information:
Cash paid during the period for interest$938  $1,552  
Cash paid during the period for income taxes570  816  
 See accompanying notes to condensed consolidated financial statements.
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GP STRATEGIES CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements
 
March 31, 2020
(Unaudited)

(1)Basis of Presentation

GP Strategies Corporation is a global performance improvement solutions provider of training, digital learning solutions, management consulting and engineering services. References in this report to “GP Strategies,” the “Company,” “we” and “our” are to GP Strategies Corporation and its subsidiaries, collectively.
 
The accompanying condensed consolidated balance sheet as of March 31, 2020, the condensed consolidated statements of operations, comprehensive income (loss) and stockholders' equity for the three months ended March 31, 2020 and 2019, and the condensed consolidated statements of cash flows for the three months ended March 31, 2020 and 2019 have not been audited, but have been prepared in conformity with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2019, as presented in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019. In the opinion of management, this interim information includes all material adjustments, which are of a normal and recurring nature, necessary for a fair presentation. The results for the 2020 interim period are not necessarily indicative of results to be expected for the entire year.
 
The condensed consolidated financial statements include the operations of the Company and its subsidiaries. All significant intercompany balances and transactions have been eliminated.

Certain prior year amounts have been reclassified to conform with the current year presentation.

Use of Estimates and Assumptions

The preparation of financial statements in conformity with U.S. GAAP requires us to employ estimates and make  assumptions that affect the reported amounts of certain assets and liabilities, the revenues and expenses reported for the periods covered by the accompanying consolidated financial statements, and certain amounts disclosed in these Notes to the Condensed Consolidated Financial Statements. Although such estimates and assumptions are based on management’s most recent assessment of the underlying facts and circumstances utilizing the most current information available and past experience including considerations for potential impacts of the coronavirus (COVID-19) pandemic, actual results could differ significantly from those estimates and assumptions. Our estimates, judgments, and assumptions are evaluated periodically and adjusted accordingly.

Please refer to Note 1- Significant Accounting Policies of the Notes to Consolidated Financial Statements included in our 2019 Form 10-K for a discussion of other significant estimates and assumptions affecting our consolidated financial statements.

(2)Recent Accounting Standards

        Recently Adopted Accounting Standards

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASC 326), which requires companies to record an allowance for expected credit losses over the contractual term of financial assets, including short-term trade receivables and contract assets, and expands disclosure requirements for credit quality of financial assets. We adopted the standard on January 1, 2020 and began recognizing an allowance for credit losses based on the estimated lifetime expected credit loss related to our financial assets, which primarily includes accounts receivable and unbilled revenue. The adoption of Topic 326 did not have a material impact on our consolidated results of operations or financial condition. During the three months ended March 31, 2020, we incorporated the forecasted impact of future economic conditions into our allowance for credit losses measurement process including the expected adverse impact of COVID-19 on the global economy.

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GP STRATEGIES CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements
 
March 31, 2020
(Unaudited)
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosure requirements for fair value measurements. The guidance promotes a framework to help improve the effectiveness of disclosures in the notes and is effective for annual and interim periods beginning after December 15, 2019, although early adoption is permitted. We adopted the standard on January 1, 2020. The new standard did not impact our consolidated results of operations or financial condition.

Accounting Standards Not Yet Adopted
For a discussion of other accounting standards that have been issued by the FASB but are not yet effective, refer to the Recent Accounting Standards section in our Annual Report on Form 10-K for the year ended December 31, 2019. These standards are not expected to have a material impact on our results of operations, financial condition or cash flows.

(3)Revenue

Significant Accounting Policy
We account for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (ASC Topic 606). Revenue is measured based on the consideration specified in a contract with a customer. Most of our contracts with customers contain transaction prices with fixed consideration, however, some contracts may contain variable consideration in the form of discounts, rebates, refunds, credits, price concessions, incentives, performance bonuses, penalties and other similar items. When a contract includes variable consideration, we evaluate the estimate of variable consideration to determine whether the estimate needs to be constrained; therefore, we include the variable consideration in the transaction price only to the extent that it is probable that a significant reversal of the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. We recognize revenue when we satisfy a performance obligation by transferring control over a product or service to a customer. This can result in recognition of revenue over time as we perform services or at a point in time when the deliverable is transferred to the customer, depending on an evaluation of the criteria for over time recognition in ASC Topic 606. Further details regarding our revenue recognition for various revenue streams are discussed below.
Nature of goods and services
Over 90% of our revenue is derived from services provided to our customers for training, consulting, technical, engineering and other services. Less than 10% of our revenue is derived from various other offerings including custom magazine publications and assembly of glovebox portfolios for automotive manufacturers, licenses of software and other intellectual property, and software as a service (SaaS) arrangements.
Our primary contract vehicles are time-and-materials, fixed price (including fixed-fee per transaction) and cost-reimbursable contracts. Each contract has different terms based on the scope, deliverables and complexity of the engagement, requiring us to make judgments and estimates about recognizing revenue.
 
Under time-and-materials and cost-reimbursable contracts, the contractual billing schedules are based on the specified level of resources we are obligated to provide. Revenue under these contract types are recognized over time as services are performed as the client simultaneously receives and consumes the benefits provided by our performance throughout the engagement. The time and materials incurred for the period is the measure of performance and, therefore, revenue is recognized in that amount.
 
For fixed price contracts which typically involve a discrete project, such as development of training content and materials, design of training processes, software implementation, or engineering projects, the contractual billing schedules are not necessarily based on the specified level of resources we are obligated to provide. These discrete projects generally do not contain milestones or other measures of performance. The majority of our fixed price contracts meet the criteria in ASC Topic 606 for over time revenue recognition. For these contracts, revenue is recognized using a percentage-of-completion method based on the relationship of costs incurred to total estimated costs expected to be incurred over the term of the contract. We believe this methodology is a reasonable measure of proportional performance since performance primarily involves personnel costs and services provided to the customer throughout the course of the projects through regular communications of progress toward completion and other project deliverables. In addition, the customer is required to pay
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GP STRATEGIES CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements
 
March 31, 2020
(Unaudited)
us for the proportionate amount of our fees in the event of contract termination. A small portion of our fixed price contracts do not meet the criteria in ASC Topic 606 for over time revenue recognition. For these projects, we defer revenue recognition until the performance obligation is satisfied, which is generally when the final deliverable is provided to the client. The direct costs related to these projects are capitalized and then recognized as cost of revenue when the performance obligation is satisfied.
 
For fixed price contracts, when total direct cost estimates exceed revenues, the estimated losses are recognized immediately. The use of the percentage-of-completion method requires significant judgment relative to estimating total contract costs, including assumptions relative to the length of time to complete the project, the nature and complexity of the work to be performed, and anticipated changes in estimated salaries and other costs. Estimates of total contract costs are continuously monitored during the term of the contract, and recorded revenues and costs are subject to revision as the contract progresses. When revisions in estimated contract revenues and costs are determined, such adjustments are recorded in the period in which they are first identified. Adjustments to our fixed price contracts in the aggregate resulted in a net decrease to revenue of $0.1 million for the three months ended March 31, 2020 and a net increase to revenue of $1.1 million for the three months ended March 31, 2019.

For certain fixed-fee per transaction contracts, such as delivering training courses or conducting workshops, revenue is recognized during the period in which services are delivered in accordance with the pricing outlined in the contracts.

For certain fixed-fee per transaction and fixed price contracts in which the output of the arrangement is measurable, such as for the shipping of publications and print materials, revenue is recognized at the point in time at which control is transferred which is upon delivery. 

Taxes assessed by a government authority that are both imposed on and concurrent with a specific revenue-producing transaction, that we collect from a customer, are excluded from revenue.
Performance Obligations
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC Topic 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. For contracts with multiple performance obligations, we allocate the contract’s transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. As of March 31, 2020, we had $341.2 million of remaining performance obligations, which we also refer to as total backlog. We expect to recognize approximately 85 percent of our remaining performance obligations as revenue within the next twelve months.

Contract Balances
The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled revenue (contract assets), and deferred revenue (contract liabilities) on the condensed consolidated balance sheet. Amounts charged to our clients become billable according to the contract terms, which usually consider the passage of time, achievement of milestones or completion of the project. When billings occur after the work has been performed, such unbilled amounts will generally be billed and collected within 60 to 120 days but typically no longer than over the next twelve months. When we advance bill clients prior to the work being performed, generally, such amounts will be earned and recognized in revenue within the next twelve months. These assets and liabilities are reported on the condensed consolidated balance sheet on a contract-by-contract basis at the end of each reporting period. Changes in the contract asset and liability balances during the three-month period ended March 31, 2020 were not materially impacted by any other factors.
We recognized revenue of $8.2 million and $11.1 million for the three months ended March 31, 2020 and 2019, respectively, that was included in the contract liability balance at the beginning of the year and primarily represented revenue from services performed during the current period for which we received advance payment from clients in a prior period.
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GP STRATEGIES CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements
 
March 31, 2020
(Unaudited)
Revenue by Category
The following series of tables presents our revenue disaggregated by various categories (dollars in thousands).
Three Months Ended March 31,
Workforce
Excellence
Business Transformation ServicesConsolidated
202020192020201920202019
Revenue by type of service:  
Managed learning services$42,498  $44,642  $  $  $42,498  $44,642  
Engineering & technical services31,880  36,836      31,880  36,836  
Sales enablement    32,488  35,551  32,488  35,551  
Organizational development    21,415  22,444  21,415  22,444  
 $74,378  $81,478  $53,903  $57,995  $128,281  $139,473  
Revenue by geographic region:
Americas$56,563  $59,664  $36,849  $40,620  $93,412  $100,284  
Europe Middle East Africa 17,672  19,278  16,161  15,017  33,833  34,295  
Asia Pacific5,445  6,142  4,739  5,134  10,184  11,276  
Eliminations(5,302) (3,606) (3,846) (2,776) (9,148) (6,382) 
$74,378  $81,478  $53,903  $57,995  $128,281  $139,473  
Revenue by client market sector:
Automotive$2,453  $3,598  $29,702  $34,176  $32,155  $37,774  
Financial & Insurance19,156  19,206  1,471  1,915  20,627  21,121  
Manufacturing9,158  9,270  2,958  5,018  12,116  14,288  
Energy / Oil & Gas6,275  11,530  1,173  1,028  7,448  12,558  
U.S. Government11,206  9,795  1,582  1,729  12,788  11,524  
U.K. Government    5,267  4,043  5,267  4,043  
Information & Communication4,115  5,306  629  459  4,744  5,765  
Aerospace8,296  7,510  1,017  103  9,313  7,613  
Electronics Semiconductor2,623  4,130  217  246  2,840  4,376  
Life Sciences5,108  4,894  1,214  1,933  6,322  6,827  
Other5,988  6,239  8,673  7,345  14,661  13,584  
$74,378  $81,478  $53,903  $57,995  $128,281  $139,473  

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GP STRATEGIES CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements
 
March 31, 2020
(Unaudited)

(4)Significant Customers & Concentration of Credit Risk

We have a market concentration of revenue in both the automotive sector and financial & insurance sector. Revenue from the automotive sector accounted for approximately 25% and 27% of our consolidated revenue for the three months ended March 31, 2020 and 2019, respectively. In addition, we have a concentration of revenue from a single automotive customer, which accounted for approximately 14% and 13% of our consolidated revenue for the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020, accounts receivable from a single automotive customer totaled $13.6 million, or 13%, of our consolidated accounts receivable balance.

Revenue from the financial & insurance sector accounted for approximately 16% and 15% of our consolidated revenue for the three months ended March 31, 2020 and 2019, respectively. In addition, we have a concentration of revenue from a single financial services customer, which accounted for approximately 9% and 11% of our consolidated revenue for the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020, billed and unbilled accounts receivable from a single financial services customer totaled $12.4 million, or 8%, of our consolidated accounts receivable and unbilled revenue balances.

No other single customer accounted for more than 10% of our consolidated revenue for the three months ended March 31, 2020 or 2019 or consolidated accounts receivable balance as of March 31, 2020.


(5)Earnings Per Share

Basic earnings per share (EPS) is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted EPS reflects the potential dilution of common stock equivalent shares that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.
 
Our dilutive common stock equivalent shares consist of restricted stock units computed under the treasury stock method, using the average market price during the period. Performance-based restricted stock unit awards are included in the computation of diluted shares based on the probable outcome of the underlying performance conditions being achieved.

The following table presents instruments which were not dilutive and were excluded from the computation of diluted EPS in each period, as well as the dilutive common stock equivalent shares which were included in the computation of diluted EPS: 
Three Months Ended
March 31,
 20202019
 (In thousands)
Non-dilutive instruments36  51  
Dilutive common stock equivalents35  31  



10


GP STRATEGIES CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements
 
March 31, 2020
(Unaudited)
(6)Divestiture

Sale of Alternative Fuels Division

Effective January 1, 2020, we sold our Alternative Fuels Division pursuant to an Asset Purchase Agreement with Cryogenic Industries, LLC. The upfront cash purchase price was $4.8 million, which consisted of an advance payment of $1.5 million received on December 31, 2019 and $3.5 million received on January 2, 2020, offset by a $0.2 million cash payment to the buyer in March 2020 in settlement of the final net working capital as defined in the asset purchase agreement. In addition, up to $0.5 million of the purchase price is subject to the achievement of certain milestones under an assigned contract through the period December 31, 2021. We recognized a pre-tax gain of $1.1 million, net of $1.3 million direct selling costs, on the sale of the business. The gain represents the difference between the purchase price and the carrying value of the business, which primarily included net working capital of $0.1 million and goodwill of $2.6 million. The Alternative Fuels Division was part of the Workforce Excellence segment.



(7)Intangible Assets

Goodwill
 
Changes in the carrying amount of goodwill by reportable business segment for the three months ended March 31, 2020 were as follows (in thousands):
Workforce ExcellenceBusiness Transformation ServicesTotal
Balance as of December 31, 2019$119,311  $52,252  $171,563  
Divestiture(2,594)   (2,594) 
Foreign currency translation(2,921) (1,236) (4,157) 
Balance as of March 31, 2020$113,796  $51,016  $164,812  


Intangible Assets Subject to Amortization
 
Intangible assets with finite lives are subject to amortization over their estimated useful lives. The primary assets included in this category and their respective balances were as follows (in thousands):
 Gross Carrying AmountAccumulated AmortizationNet Carrying Amount
March 31, 2020
Customer relationships$20,071  $(6,733) $13,338  
Intellectual property and other3,467  (2,222) 1,245  
 $23,538  $(8,955) $14,583  
December 31, 2019   
Customer relationships$22,348  $(7,473) $14,875