UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) August 3, 2005
AMERICAN REPROGRAPHICS
COMPANY
 
(Exact Name of Registrant as Specified in its Charter)

STATE OF DELAWARE	 	001-32407	 	20-1700361	
 	 	 	 	 	
(State or other jurisdiction of
Incorporation or Organization)	 	(Commission
File Number)	 	(I.R.S. Employer
Identification No.)	
 	 	 	
700 North Central Avenue, Suite 550, Glendale, California	 	91203	
 	 	 	
(Address of Principal Executive Offices)	 	(Zip Code)	
Registrant’s telephone number, including area code (818) 500-0225
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o	 	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 	
o	 	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 	
o	 	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)	
 	
o	 	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)	

 

 

Item 2.02 Results of Operations and Financial Condition
On August 3, 2005, American Reprographics Company issued a press release reporting its financial results for the second quarter of 2005. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference into this Item 2.02. 
Item 9.01 Financial Statements and Exhibits

Exhibit No.	 	Description	
99.1	 	American Reprographics Company Press Release dated August 3, 2005	

 
SIGNATURES
     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: August 3, 2005 	AMERICAN REPROGRAPHICS COMPANY
 	 	
 	By:  	/s/ Sathiyamurthy Chandramohan  	 	
 	 	Sathiyamurthy Chandramohan 	 	
 	 	Chief Executive Officer 	 	

 

EXHIBIT INDEX

Exhibit	 	 	
No.	 	Description	
99.1	 	American Reprographics Company Press Release dated August 3, 2005	

 

Exhibit 99.1
AMERICAN REPROGRAPHICS COMPANY POSTS RECORD RESULTS
FOR SECOND QUARTER 2005
~ Revenue: $125.6 Million Up From $115.6 Million ~
 
~ Net Income: $11.4 Million ~
 
~ Fully Diluted EPS: $0.25 ~
 
~ Updates Financial Outlook for Full Year ~

GLENDALE, California (August 3, 2005) – American Reprographics Company (NYSE: ARP), the nation’s leading provider of reprographic services and technology with more than 190 locations across the U.S. today reported revenue for the second quarter of 2005 of $125.6 million compared to $115.6 million in the second quarter of 2004, an increase of 8.6%. Net income for the second quarter of 2005 was $11.4 million, or $0.25 per diluted share. Adjusting for a proforma incremental income tax provision as if the Company had been a Delaware corporation for the second quarter, net income for the same period last year was $6.9 million, or $0.18 per fully diluted share.
Net income for the first six months of 2005 was $46.9 million, or $1.10 per diluted share, including a one-time $27.7 million income tax benefit due to the Company’s reorganization from a limited liability company to a Delaware corporation in conjunction with its IPO in February 2005. Excluding the one-time income tax benefit, the Company earned $0.44 per fully diluted share, in the first six months of 2005. Net income for the first six months of 2004 was $18.3 million, or $0.49 per fully diluted share. Recognizing the proforma incremental income tax the Company would have paid had it been organized as a Delaware corporation in the first six months of 2004, proforma net income for that period of 2004 was $12.7 million, or $0.34 per fully diluted share.
“We were pleased to post a strong level of revenues and profits during the first half of 2005,” said S. “Mohan” Chandramohan, Chairman and CEO of American Reprographics Company. “We experienced positive impact from favorable overall macroeconomic trends that began in 2004 and continued through the second quarter, including strong demand for commercial office space due to expanding employment, and continued business investment. These trends contribute to strength in the architectural, engineering and construction industry, which continues to represent roughly 80% of our revenue mix. In addition to strong industry trends, each business segment at ARC is operating efficiently and we continue to focus on the successful execution of our strategic initiatives which are experiencing positive traction.”
K. “Suri” Suriyakumar, President and COO said, “There were many highlights during the period which made incremental contributions to our organic growth. To begin, strength in large-document construction-oriented reprographics remained robust, while growth in our on-site services business, which we refer to as facilities management, continued to increase steadily. Moreover, membership in the PEiR Group, our private trade association, grew from 63 members at the end of the first quarter to 108 members at the end of June, growth of more than 50%. This is a significant achievement for ARC because the PEiR Group is a core component to our strategy of promoting PlanWell® technology as the industry standard for procuring online reprographics services.”
“In addition, we expanded our presence in the Midwest with new facilities in both Cleveland and Cincinnati, Ohio,” Suri concluded.
Outlook
Based on current trends, business visibility, the opening of new locations and the entrance into new markets, American Reprographics Company is increasing its previous revenue and EPS forecast for the year. For 2005, the Company now anticipates that revenue will be between $485-$490 million and fully diluted EPS, excluding the one-time income tax benefit of $27.7 million due to the Company’s reorganization, will be in the range of $0.82-$0.84.
1

 

Teleconference and Webcast
American Reprographics Company will host a conference call and audio webcast today at 2 p.m. Pacific time to discuss financial results for the second quarter ended June 30, 2005. The conference call can be accessed by dialing 800-510-0178 (Domestic) or 617-614-3450 (International). The passcode is “99407329.”
A replay of this call will be available for seven days. This replay can be accessed by dialing 617-801-6888. The required passcode for the replay is “90413811.”
A live webcast of this conference call can be accessed at the Company’s website at www.e-arc.com . An archive of the webcast will be available for approximately 90 days following the conclusion of the teleconference.
About American Reprographics Company
American Reprographics Company is the leading reprographics company in the United States providing business-to-business document management services to the architectural, engineering and construction, or AEC industries. The company provides these services to companies in non-AEC industries, such as technology, financial services, retail, entertainment, and food and hospitality, which also require sophisticated document management services. We provide our core services through our suite of reprographics technology products, a network of locally branded reprographics service centers across the U.S., and on-site at our customers’ locations. Our service centers are arranged in a hub and satellite structure and are digitally connected as a cohesive network, allowing us to provide our services both locally and nationally. We serve more than 65,000 active customers.
Forward-Looking Statements Disclaimer
This press release contains forward-looking statements that fall within the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 regarding future events and the future financial performance of the Company. Words such as “believe,” “expect,” “may,” “anticipate” and similar expressions also identify forward-looking statements. Forward-looking statements include statements regarding favorable overall macroeconomic trends, positive trends in the architectural, engineering and construction industries, our ongoing technology development, continued success in implementing our major strategic initiatives, and 2005 revenue and earnings per share estimates. We wish to caution you that such statements are only predictions and actual results may differ materially as a result of risks and uncertainties that pertain to our business. These risks and uncertainties include, among others:

 	•	 	Future downturns in the architectural, engineering and construction industries could diminish demand for our products and services	
 		
 	•	 	Competition in our industry and innovation by our competitors may hinder our ability to execute our business strategy and maintain our profitability	
 		
 	•	 	Failure to anticipate and adapt to future changes in our industry could harm our competitive position	
 		
 	•	 	Failure to manage our acquisitions, including our inability to integrate and merge the business operations of the acquired companies, and failure to retain key personnel and customers of acquired companies could have a negative affect on our future performance, results of operations and financial condition	
 		
 	•	 	Dependence on certain key vendors for equipment, maintenance services and supplies, could make us vulnerable to supply shortages and price fluctuations	
 		
 	•	 	Damage or disruption to our facilities, our technology centers, our vendors or a majority of our customers could impair our ability to effectively provide our services and may have a significant impact on our revenues, expenses and financial condition	
 		
 	•	 	If we fail to continue to develop and introduce new services successfully, our competitive positioning and our ability to grow our business could be harmed.	
The foregoing list of risks and uncertainties is illustrative but is by no means exhaustive. For more information on factors that may affect future performance, please review our SEC filings, specifically our Quarterly Report on Form 10-Q for the quarter ended March 31, 2005, our Annual Report on Form 10-K for the year ended December 31, 2004 and our final prospectus dated February 3, 2005. These documents contain important risk factors that could cause actual results to differ materially from those contained in our projections or forward-looking statements. These forward-looking statements are based on information as of August 3, 2005, and except as required by law, ARC undertakes no obligation to update or revise any forward-looking statements.
2

 

Non-GAAP Measures
This press release includes the following financial measures defined as non-GAAP financial measures by the Securities and Exchange Commission: EBITDA, EBIT, proforma incremental tax provision, and proforma net income. These measures may be different from non-GAAP financial measures used by other companies. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles. See Note 1 to “Non-GAAP Measures” included in this press release for further information.

Contacts:
David Stickney
Director of Corporate Communications
Phone: 925-949-5100
Email: dstickney@e-arc.com
Jason Golz
Financial Dynamics
Phone: 415-439-4532
Email: jgolz@fd-us.com

3

 

American Reprographics Company
Consolidated Balance Sheets
(dollars in thousands, except per share data)
 	 	 	 	 	 	 	 	 	
 	 	December 31,	 	 	June 30,	 	
 	 	2004	 	 	2005	 	
 	 	 	 	 	 	(Unaudited)	 	
Assets	 	 	 	 	 	 	 	 	
Current assets:	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	13,826	 	 	$	12,591	 	
Accounts receivable, net	 	 	61,679	 	 	 	69,748	 	
Inventories, net	 	 	6,012	 	 	 	5,894	 	
Deferred taxes	 	 	1,364	 	 	 	2,859	 	
Prepaid expenses and other current assets	 	 	7,855	 	 	 	5,797	 	
 	 	 	 	 	 	 	
Total current assets	 	 	90,736	 	 	 	96,889	 	
 	 	 	 	 	 	 	 	 	
Property and equipment, net	 	 	35,023	 	 	 	36,430	 	
Goodwill	 	 	231,357	 	 	 	234,496	 	
Other intangible assets, net	 	 	12,095	 	 	 	13,231	 	
Deferred financing costs, net	 	 	6,619	 	 	 	4,778	 	
Deferred taxes	 	 	—	 	 	 	18,442	 	
Other assets	 	 	1,504	 	 	 	1,407	 	
 	 	 	 	 	 	 	
Total assets	 	$	377,334	 	 	$	405,673	 	

Liabilities and Stockholders’ Equity	 	 	 	 	 	 	 	 	
Liabilities:	 	 	 	 	 	 	 	 	
Accounts payable	 	$	21,170	 	 	$	21,625	 	
Accrued payroll and payroll-related expenses	 	 	11,683	 	 	 	12,159	 	
Accrued expenses	 	 	24,834	 	 	 	22,348	 	
Current portion of long-term debt and capital leases	 	 	10,276	 	 	 	11,978	 	
 	 	 	 	 	 	 	
Total current liabilities	 	 	67,963	 	 	 	68,110	 	
 	 	 	 	 	 	 	 	 	
Long-term debt and capital leases, net of debt discount	 	 	310,557	 	 	 	244,374	 	
Mandatorily redeemable preferred membership units	 	 	27,814	 	 	 	—	 	
Deferred taxes	 	 	5,634	 	 	 	—	 	
Other long-term liabilities	 	 	375	 	 	 	377	 	
 	 	 	 	 	 	 	
Total liabilities	 	 	412,343	 	 	 	312,861	 	

Commitments and contingencies	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	
Stockholders’ equity (deficit):	 	 	 	 	 	 	 	 	
Members’ deficit	 	 	(32,688	)	 	 	—	 	
Preferred stock, $.001 par value, 25,000,000 shares authorized; zero and zero shares issued and outstanding	 	 	—	 	 	 	—	 	
Common stock, $.001 par value, 150,000,000 shares authorized; zero and 43,931,154 shares issued and outstanding	 	 	—	 	 	 	44	 	
Additional paid-in capital	 	 	—	 	 	 	49,730	 	
Deferred stock-based compensation	 	 	(2,527	)	 	 	(2,219	)	
Retained earnings	 	 	—	 	 	 	45,032	 	
Accumulated other comprehensive income	 	 	206	 	 	 	225	 	
 	 	 	 	 	 	 	
Total stockholders’ equity (deficit)	 	 	(35,009	)	 	 	92,812	 	
 	 	 	 	 	 	 	
Total liabilities and stockholders’ equity (deficit)	 	$	377,334	 	 	$	405,673	 	
 	 	 	 	 	 	 	
4

 

American Reprographics Company
Consolidated Statements of Operations
(dollars in thousands, except per share data)
(Unaudited)
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Three Months Ended	 	 	Six Months Ended	 	
 	 	June 30,	 	 	June 30,	 	
 	 	2004	 	 	2005	 	 	2004	 	 	2005	 	
Net sales	 	$	115,615	 	 	$	125,560	 	 	$	226,133	 	 	$	242,026	 	
Cost of sales	 	 	66,191	 	 	 	71,906	 	 	 	130,790	 	 	 	140,047	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Gross profit	 	 	49,424	 	 	 	53,654	 	 	 	95,343	 	 	 	101,979	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Selling, general and administrative expenses	 	 	28,363	 	 	 	28,140	 	 	 	55,264	 	 	 	55,021	 	
Amortization of intangible assets	 	 	422	 	 	 	431	 	 	 	852	 	 	 	815	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Income from operations	 	 	20,639	 	 	 	25,083	 	 	 	39,227	 	 	 	46,143	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other income	 	 	(293	)	 	 	(106	)	 	 	(567	)	 	 	(224	)	
Interest expense, net	 	 	8,405	 	 	 	6,194	 	 	 	16,530	 	 	 	14,518	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Income before income tax provision (benefit)	 	 	12,527	 	 	 	18,995	 	 	 	23,264	 	 	 	31,849	 	
Income tax provision (benefit)	 	 	2,682	 	 	 	7,612	 	 	 	4,981	 	 	 	(15,097	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Net income	 	 	9,845	 	 	 	11,383	 	 	 	18,283	 	 	 	46,946	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income tax benefit due to Reorganization	 	 	—	 	 	 	—	 	 	 	—	 	 	 	(27,701	)	
Unaudited proforma incremental income tax provision	 	 	2,981	 	 	 	—	 	 	 	5,536	 	 	 	333	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Unaudited proforma net income	 	$	6,864	 	 	$	11,383	 	 	$	12,747	 	 	$	18,912	 	

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Earnings per share (Actual):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	$	0.28	 	 	$	0.26	 	 	$	0.52	 	 	$	1.13	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted	 	$	0.26	 	 	$	0.25	 	 	$	0.49	 	 	$	1.10	 	

Earnings per share (Proforma):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	$	0.19	 	 	$	0.26	 	 	$	0.36	 	 	$	0.45	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted	 	$	0.18	 	 	$	0.25	 	 	$	0.34	 	 	$	0.44	 	

Weighted average common shares outstanding:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	 	35,487,511	 	 	 	43,931,154	 	 	 	35,487,511	 	 	 	41,690,494	 	
Diluted	 	 	37,437,422	 	 	 	44,861,155	 	 	 	37,437,422	 	 	 	42,771,754	 	
5

 

American Reprographics Company
Non-GAAP Measures
Reconciliation of Net Income to EBIT and EBITDA
(dollars in thousands, except per share data)
(Unaudited)
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Three Months Ended	 	 	Six Months Ended	 	
 	 	June 30,	 	 	June 30,	 	
 	 	2004	 	 	2005	 	 	2004	 	 	2005	 	
Net income	 	$	9,845	 	 	$	11,383	 	 	$	18,283	 	 	$	46,946	 	
Interest expense, net	 	 	8,405	 	 	 	6,194	 	 	 	16,530	 	 	 	14,518	 	
Income tax provision (benefit)	 	 	2,682	 	 	 	7,612	 	 	 	4,981	 	 	 	(15,097	)	
 	 	 	 	 	 	 	 	 	 	 	 	 	
EBIT	 	 	20,932	 	 	 	25,189	 	 	 	39,794	 	 	 	46,367	 	
Depreciation	 	 	4,485	 	 	 	4,028	 	 	 	8,569	 	 	 	8,074	 	
Amortization	 	 	422	 	 	 	431	 	 	 	852	 	 	 	815	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
EBITDA	 	$	25,839	 	 	$	29,648	 	 	$	49,215	 	 	$	55,256	 	

Net income	 	$	9,845	 	 	$	11,383	 	 	$	18,283	 	 	$	46,946	 	
Income tax benefit due to Reorganization	 	 	—	 	 	 	—	 	 	 	—	 	 	 	(27,701	)	
Unaudited proforma incremental income tax provision	 	 	2,981	 	 	 	—	 	 	 	5,536	 	 	 	333	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Unaudited proforma net income	 	$	6,864	 	 	$	11,383	 	 	$	12,747	 	 	$	18,912	 	

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Earnings per share (Actual):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	$	0.28	 	 	$	0.26	 	 	$	0.52	 	 	$	1.13	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted	 	$	0.26	 	 	$	0.25	 	 	$	0.49	 	 	$	1.10	 	

Earnings per share (Proforma):	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	$	0.19	 	 	$	0.26	 	 	$	0.36	 	 	$	0.45	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Diluted	 	$	0.18	 	 	$	0.25	 	 	$	0.34	 	 	$	0.44	 	

Weighted average common shares outstanding:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Basic	 	 	35,487,511	 	 	 	43,931,154	 	 	 	35,487,511	 	 	 	41,690,494	 	
Diluted	 	 	37,437,422	 	 	 	44,861,155	 	 	 	37,437,422	 	 	 	42,771,754	 	
See Note 1 for additional information regarding non-GAAP measures.
6

 

Note 1. Non-GAAP Measures
     EBIT and EBITDA are supplemental measures of our performance that are not required by, or presented in accordance with GAAP. These measures are not measurements of our financial performance under GAAP and should not be considered as alternatives to net income, income from operations, or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating, investing or financing activities as a measure of our liquidity.
     EBIT represents net income before interest and taxes. EBITDA represents net income before interest, taxes, depreciation and amortization. We present EBIT and EBITDA because we consider them important supplemental measures of our performance and liquidity and believe that such measures are meaningful to investors because they are used by management for the reasons discussed below.
     We use EBIT as a metric to measure and compare the performance of our divisions. We operate our 39 divisions as separate business units, but manage debt and taxation at the corporate level. As a result, EBIT is the best measure of divisional profitability and the most useful metric by which to measure and compare the performance of our divisions. We also use EBIT as a metric to measure performance for the purpose of determining compensation at the division level and use EBITDA to measure performance and determine compensation at the consolidated level. We also use EBITDA as a metric to manage cash flow from our divisions to the corporate level and to determine the financial health of each division. As noted above, because our divisions do not incur interest or income tax expense, the cash flow from each division should be equal to the corresponding EBITDA of each division, assuming no other changes to a division’s balance sheet. As a result, we reconcile EBITDA to cash flow on a monthly basis as one of our key internal controls. We also use EBIT and EBITDA to evaluate potential acquisitions and to evaluate whether to incur capital expenditures. In addition, certain covenants in our credit agreements require compliance with financial ratios based on EBITDA, adjusted for certain items as defined in our credit agreements.
     EBIT and EBITDA have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:
      • they do not reflect our cash expenditures, or future requirements for capital expenditures and contractual commitments;
      • they do not reflect changes in, or cash requirements for, our working capital needs;
      • they do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments on our debt;
      • although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements.
     Because of these limitations, EBIT and EBITDA should not be considered as measures of discretionary cash available to us to invest in the growth of our business or reduce our indebtedness. We compensate for these limitations by relying primarily on our GAAP results and using EBIT and EBITDA only supplementally.
     We have presented our earnings per share for the six months ended June 30, 2005 adjusted to exclude a one-time income tax benefit to the Company in order to present the Company’s operating results for the six months ended June 30, 2005 in meaningful comparison to the same period in 2004.
7

 

American Reprographics Company
Consolidated Statements of Cash Flows
(dollars in thousands)
(Unaudited)
 	 	 	 	 	 	 	 	 	
 	 	Six Months Ended	 	
 	 	June 30,	 	
 	 	2004	 	 	2005	 	
Operating activities	 	 	 	 	 	 	 	 	
Net income	 	$	18,283	 	 	$	46,946	 	
Adjustments to reconcile net income to net cash provided by operating activities:	 	 	 	 	 	 	 	 	
Accretion of yield on redeemable preferred member units	 	 	982	 	 	 	449	 	
Allowance for doubtful accounts	 	 	820	 	 	 	723	 	
Reserve for inventory obsolescence	 	 	30	 	 	 	90	 	
Depreciation	 	 	8,569	 	 	 	8,074	 	
Amortization of intangible assets	 	 	852	 	 	 	815	 	
Amortization of deferred financing costs	 	 	987	 	 	 	823	 	
Deferred income taxes	 	 	894	 	 	 	(25,571	)	
Write-off of deferred financing costs	 	 	—	 	 	 	1,631	 	
Amortization of deferred stock-based compensation	 	 	167	 	 	 	308	 	
Changes in operating assets and liabilities, net of effect of business acquisitions:	 	 	 	 	 	 	 	 	
Accounts receivable, net	 	 	(11,424	)	 	 	(7,527	)	
Inventory	 	 	(161	)	 	 	200	 	
Prepaid expenses and other assets	 	 	(928	)	 	 	720	 	
Accounts payable and accrued expenses	 	 	9,612	 	 	 	(3,092	)	
 	 	 	 	 	 	 	
Net cash provided by operating activities	 	 	28,683	 	 	 	24,589	 	

Investing activities	 	 	 	 	 	 	 	 	
Capital expenditures	 	 	(3,427	)	 	 	(2,476	)	
Payments for businesses acquired, net of cash acquired and including other cash payments associated with the acquisitions	 	 	(1,880	)	 	 	(4,076	)	
Other	 	 	(115	)	 	 	(209	)	
 	 	 	 	 	 	 	
Net cash used in investing activities	 	 	(5,422	)	 	 	(6,761	)	

Financing activities	 	 	 	 	 	 	 	 	
Proceeds from initial public offering, net of underwriting discounts	 	 	—	 	 	 	92,690	 	
Direct costs of initial public offering	 	 	—	 	 	 	(1,487	)	
Redemption of preferred member units	 	 	—	 	 	 	(28,263	)	
Proceeds from borrowings under debt agreements	 	 	1,000	 	 	 	13,000	 	
Payments on long-term debt under debt agreements	 	 	(21,367	)	 	 	(86,636	)	
Payment of loan fees	 	 	(355	)	 	 	(123	)	
Member distributions	 	 	(3,045	)	 	 	(8,244	)	
 	 	 	 	 	 	 	
Net cash used in financing activities	 	 	(23,767	)	 	 	(19,063	)	

Net decrease in cash and cash equivalents	 	 	(506	)	 	 	(1,235	)	
Cash and cash equivalents at beginning of period	 	 	17,315	 	 	 	13,826	 	
 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	 	$	16,809	 	 	$	12,591	 	

Supplemental disclosure of cash flow information	 	 	 	 	 	 	 	 	
Noncash investing and financing activities	 	 	 	 	 	 	 	 	
Noncash transactions include the following:	 	 	 	 	 	 	 	 	
Capital lease obligations incurred	 	$	4,696	 	 	$	6,104	 	
Issuance of subordinated notes in connection with the acquisition of businesses	 	$	250	 	 	$	1,974	 	
Change in fair value of derivatives	 	$	1,031	 	 	$	19	 	
8