Annual report pursuant to Section 13 and 15(d)

Acquisitions (Tables)

v3.24.4
Acquisitions (Tables)
 12 Months Ended
Sep. 30, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]  
Schedule of Purchase Price Allocation of Purchase of Acquired Identifiable Assets, Liabilities Assumed and Goodwill The table below outlines the purchase price allocation of the purchase for Midwest Grinding to the acquired identifiable assets and liabilities assumed as of September 30, 2024 (in $000’s):
Total purchase price $ 1,000 
Accounts payable 1 
Total consideration 1,001 
Accounts receivable 152 
Other current assets 71 
Property and equipment 738 
Intangible Assets
Customer relationships $ 16 
Trade names 15 
Non-compete agreement 9 
Intangible assets 40 
Total assets acquired 1,001 
Total goodwill $ — 
The fair value of the purchase price components was approximately $13.9, as detailed below (in $000's):
Purchase price $ 11,758 
Fair value of contingent consideration 2,000 
Holdback 122 
Net purchase price $ 13,880 
The table below outlines the purchase price allocation, as revised, for the purchase of Central Steel to the acquired identifiable assets, liabilities assumed and goodwill (in $000’s):
Total purchase price $ 13,880 
Accounts payable 464 
Accrued liabilities 969 
Total liabilities assumed 1,433 
Total purchase price plus liabilities assumed 15,313 
Cash 184 
Accounts receivable 2,418 
Inventory 2,171 
Property and equipment 5,034 
Intangible assets
Trade names 400 
Customer relationships 900 
Non-compete 825 
Subtotal intangible assets 2,125 
Other assets 475 
Total assets acquired 12,407 
Total goodwill $ 2,906 
The fair value of the purchase price components was $1.4 million, as detailed below (in $000's):
Cash $ 1,034 
Additional consideration 89 
Holdback 300 
Purchase price $ 1,423 
The table below outlines the purchase price allocation of the purchase for CRO to the acquired identifiable assets, liabilities assumed and goodwill as of September 30, 2024 (in $000’s):
Total purchase price $ 1,423 
Accounts payable 770 
Accrued liabilities 1,298 
Total liabilities assumed 2,068 
Total consideration 3,491 
Accounts receivable 259 
Inventory 1,406 
Property and equipment 261 
Intangible assets 1,190 
Other assets 286 
Total assets acquired 3,402 
Total goodwill $ 89 
The fair value of the purchase price components outlined above was approximately $2.0 million, as detailed below (in $000's):
Cash $ 500 
Deferred consideration 1,200 
Earnout 301 
Purchase price $ 2,001 
The table below outlines the purchase price allocation of the purchase for Johnson to the acquired identifiable assets and liabilities assumed as of September 30, 2024 (in $000’s):
Total purchase price $ 2,001 
Accounts payable 1,017 
Accrued liabilities 1,141 
Total liabilities assumed 2,158 
Total consideration 4,159 
Accounts receivable 1,252 
Inventory 1,127 
Property and equipment 157 
Intangible assets
Customer relationships $ 1,301 
Non-compete agreement 306 
Subtotal intangible assets 1,607 
Other assets 16 
Total assets acquired 4,159 
Total goodwill $ — 
The fair value of the purchase price components outlined above was $26.8 million due to fair value adjustments for the contingent consideration, cash acquired, and working capital adjustments, as detailed below (in $000's):
Purchase price $ 25,000 
Fair value of earnout 2,675 
Cash from balance sheet 1,602 
Working capital adjustment (2,500)
Net purchase price $ 26,777 
The table below outlines the purchase price allocation of the purchase for PMW to the acquired identifiable assets, liabilities assumed, and goodwill (in $000’s):
Net purchase price $ 26,777 
Accounts payable 10,788 
Accrued liabilities 5,771 
   Total liabilities assumed 16,559 
Total consideration 43,336 
Cash 1,602 
Accounts receivable 12,613 
Inventory 6,390 
Property, plant and equipment 13,616 
Intangible assets 3,600 
Other assets 849 
   Total assets acquired 38,670 
    Total goodwill $ 4,666 
The table below outlines the purchase price allocation of the purchase for Flooring Liquidators to the acquired identifiable assets, liabilities assumed and goodwill (in $000’s):
Net purchase price $ 78,700 
Accounts payable 5,189 
Accrued liabilities 9,700 
Debt 60 
   Total liabilities assumed 14,949 
Total consideration 93,649 
Cash 9,131 
Accounts receivable 4,824 
Inventory 19,402 
Property, plant and equipment 4,643 
Intangible assets
Trade names 13,275 
Customer relationships 7,700 
Non-compete agreements 1,625 
Other 49 
Subtotal intangible assets 22,649 
Other 2,581 
Total assets acquired 63,230 
Total goodwill $ 30,419 
Schedule of Asset Acquisition
The table below outlines the purchase price allocation of the purchase for Cal Coast to the acquired identifiable assets (in $000’s):
Property, plant and equipment $ 35 
Intangible assets
Customer relationships 785 
Trade name 425 
Non-compete agreement 55 
Total intangible assets 1,265 
Total assets acquired $ 1,300 
Acquisition of Flooring Liquidators
Schedule of Disposal Groups, Including Discontinued Operations The Company recognized a loss on deconsolidation of SW Financial's assets and liabilities of approximately $1.7 million, as detailed in the table below (in $000’s):
Accounts payable $ 242 
Lease liabilities 728 
   Total deconsolidation of liabilities 970 
Cash 187 
Accounts receivable 130 
Other current assets 187 
Intangible assets
Customer Relationships 1,348 
Tradenames 72 
Subtotal Intangible Assets 1,420 
Right-of-use assets 687 
Other assets 55 
Total deconsolidation of assets 2,666 
Total loss on disposition $ (1,696)
On May 24, 2024, CRO entered into an asset purchase agreement with the original seller of Johnson under which the original seller agreed to purchase certain assets and assume certain obligations acquired by CRO under the original asset
purchase agreement. Consequently, CRO recorded a loss on disposition of Johnson’s assets and liabilities of approximately $0.3 million, as detailed in the table below (in $000's):
Accounts payable and accrued liabilities $ 475 
Earnout 307 
Seller note 1,230 
Lease liabilities 2,703 
Total deconsolidation of liabilities 4,715 
Inventory 613 
Property and equipment 206 
ROU assets 2,692 
Intangible assets
Customer relationships 1,224 
Non-compete agreement 281 
Subtotal intangible assets 1,505 
Total deconsolidation of assets 5,016 
Total loss on disposition $ (301)
Schedule of Business Acquisitions, by Acquisition
The fair value the purchase price components outlined above was $78.7 million due to fair value adjustments for the Note and restricted stock, as detailed below (in $000's):
Purchase price $ 83,800 
Fair value adjustment, sellers note (3,300)
Fair value adjustment, restricted stock (1,800)
Net purchase price $ 78,700 
Schedule of Proforma Information for the Company This proforma information does not purport to represent what the actual results of operations of the Company would have been had the acquisition occurred on that date, nor does it purport to predict the results of operations for future periods (in $000’s).
Year Ended September 30, 2023 As Reported Adjustments Proforma
Live (1)
PMW (2)
Adjustments (3)
Total
Net revenue $ 355,171  $ 63,136  $ 418,307 
Net income $ (102) $ 462  $ (2,623) $ (2,263)
Earnings per basic common share $ (0.03) $ (0.72)
Earnings per basic diluted share $ (0.03) $ (0.72)
(1)Live for the year ended September 30, 2023. Includes PMW from July 20, 2023 through September 30, 2023.
(2)PMW from October 1, 2022 through the acquisition date of July 19, 2023.
(3)Reflects adjustments for (a) amortization expense of definite-lived intangible assets based on the preliminary fair value at the acquisition date, and (b) interest expense to include proforma interest expense that would have been incurred as a result of the acquisition financing obtained by the Company.
This proforma information does not purport to represent what the actual results of operations of the Company would have been had the acquisition occurred on that date, nor does it purport to predict the results of operations for future periods (in $000’s).
Year Ended September 30, 2023 As Reported Adjustments Proforma
Live (1)
Flooring Liquidators (2)
Adjustments (3)
Total
Net revenue $ 355,171  $ 37,702  $ 392,873 
Net income $ (102) $ (1,033) $ (2,226) $ (3,361)
Earnings per basic common share $ (0.03) $ (1.07)
Earnings per basic diluted share $ (0.03) $ (1.07)
(1)Live for the year ended September 30, 2023. Includes Flooring Liquidators from January 18, 2023 through September 30, 2023.
(2)Flooring Liquidators for the period of October 1, 2022 through January 17, 2023.
(3)Reflects adjustments for (a) amortization expense of definite-lived intangible assets based on the preliminary fair value at the acquisition date, (b) interest expense to include proforma interest expense that would have been incurred as a result of the acquisition financing obtained by the Company, and (c) Elimination of revenues and costs of revenues associated with sales between Flooring Liquidators and the Company prior to acquisition.