UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
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:
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of |
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(I.R.S. Employer |
(Address of principal executive offices)
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(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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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.
f
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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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 12b-2 of the Exchange Act). Yes No
As of August 8, 2024, the registrant had
Advantage Solutions Inc.
TABLE OF CONTENTS
2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ADVANTAGE SOLUTIONS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
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June 30, |
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December 31, |
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(in thousands, except share data) |
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2024 |
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2023 |
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ASSETS |
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Current assets |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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Accounts receivable, net of allowance for expected credit losses from continuing operations of $ |
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Prepaid expenses and other current assets |
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Current assets of discontinued operations |
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Total current assets |
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Property and equipment, net |
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Goodwill |
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Other intangible assets, net |
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Investments in unconsolidated affiliates |
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Other assets |
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Other assets of discontinued operations |
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Total assets |
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$ |
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$ |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities |
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Current portion of long-term debt |
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$ |
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$ |
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Accounts payable |
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Accrued compensation and benefits |
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Other accrued expenses |
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Deferred revenues |
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Current liabilities of discontinued operations |
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Total current liabilities |
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Long-term debt, net of current portion |
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Deferred income tax liabilities |
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Other long-term liabilities |
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Other liabilities of discontinued operations |
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Total liabilities |
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Common stock, $ |
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Additional paid in capital |
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Accumulated deficit |
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( |
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( |
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Loans to Karman Topco L.P. |
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( |
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( |
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Accumulated other comprehensive loss |
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( |
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( |
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Treasury stock, at cost; |
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( |
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( |
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Total equity attributable to stockholders of Advantage Solutions Inc. |
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Noncontrolling interest |
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Total stockholders’ equity |
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Total liabilities, noncontrolling interest, and stockholders’ equity |
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$ |
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$ |
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See Notes to the Condensed Consolidated Financial Statements.
3
ADVANTAGE SOLUTIONS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(UNAUDITED)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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(in thousands, except share and per share data) |
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2024 |
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2023 |
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2024 |
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2023 |
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Revenues |
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$ |
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$ |
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$ |
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$ |
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Cost of revenues (exclusive of depreciation and amortization shown separately below) |
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Selling, general, and administrative expenses |
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Impairment of goodwill |
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Depreciation and amortization |
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(Income) loss from unconsolidated investments |
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Total operating expenses |
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Operating (loss) income from continuing operations |
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Other (income) expenses: |
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Change in fair value of warrant liability |
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( |
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Interest expense, net |
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Total other expenses |
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Loss from continuing operations before income taxes |
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( |
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Benefit from income taxes for continuing operations |
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( |
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( |
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( |
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Net loss from continuing operations |
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( |
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Net income (loss) from discontinued operations, net of tax |
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Net loss |
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Less: net income from continuing operations attributable to noncontrolling interest |
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Less: net income (loss) from discontinued operations attributable to noncontrolling interest |
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Net loss attributable to stockholders of Advantage Solutions Inc. |
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$ |
( |
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$ |
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$ |
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$ |
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Net loss per common share: |
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Basic loss per common share from continuing operations |
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$ |
( |
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$ |
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$ |
( |
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$ |
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Basic earnings (loss) per common share from discontinued operations |
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$ |
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$ |
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$ |
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$ |
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Basic loss per common share attributable to stockholders of Advantage Solutions Inc. |
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$ |
( |
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$ |
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$ |
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$ |
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Diluted net loss per share: |
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Diluted loss per common share from continuing operations |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
( |
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Diluted earnings (loss) per common share from discontinued operations |
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$ |
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$ |
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$ |
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$ |
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Diluted loss per common share attributable to stockholders of Advantage Solutions Inc. |
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$ |
( |
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$ |
( |
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$ |
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$ |
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Weighted-average number of common shares: |
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Basic |
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Diluted |
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Comprehensive (Loss) Income: |
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Net loss attributable to stockholders of Advantage Solutions Inc. |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
( |
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Other comprehensive income, net of tax: |
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Foreign currency translation adjustments |
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( |
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( |
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Total comprehensive loss attributable to stockholders of Advantage Solutions Inc. |
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$ |
( |
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$ |
( |
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$ |
( |
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$ |
( |
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See Notes to the Condensed Consolidated Financial Statements.
4
ADVANTAGE SOLUTIONS INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(UNAUDITED)
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Accumulated |
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Advantage |
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Common Stock |
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Treasury Stock |
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Additional |
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Loans |
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Other |
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Solutions Inc. |
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Total |
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Paid-in |
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Accumulated |
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to |
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Comprehensive |
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Stockholders' |
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Noncontrolling |
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Stockholders' |
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(in thousands, except share data) |
Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Deficit |
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Topco |
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Income (Loss) |
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Equity |
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Interests |
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Equity |
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Balance at April 1, 2024 |
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$ |
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$ |
( |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
( |
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$ |
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$ |
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$ |
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Comprehensive (loss) income |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
) |
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— |
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( |
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Foreign currency translation adjustments |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
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( |
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Total comprehensive (loss) income |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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Interest on loans to Karman Topco L.P. |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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— |
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( |
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Purchase of treasury stock |
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( |
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— |
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( |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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Equity-based compensation of Karman Topco L.P. |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
) |
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— |
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( |
) |
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Payments for taxes related to net share settlement under 2020 Incentive Award Plan |
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— |
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— |
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— |
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— |
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( |
) |
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— |
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— |
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— |
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( |
) |
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— |
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( |
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Shares issued under 2020 Incentive Award Plan |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Sale of a business |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
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( |
) |
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( |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Balance at June 30, 2024 |
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$ |
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$ |
( |
) |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
( |
) |
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$ |
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$ |
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$ |
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Advantage |
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Common Stock |
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Treasury Stock |
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Additional |
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Loans |
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Other |
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Solutions Inc. |
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Total |
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Paid-in |
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Accumulated |
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to |
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Comprehensive |
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Stockholders' |
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Noncontrolling |
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Stockholders' |
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(in thousands, except share data) |
Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Deficit |
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Topco |
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Income (Loss) |
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Equity |
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Interests |
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Equity |
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Balance at April 1, 2023 |
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$ |
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$ |
( |
) |
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$ |
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$ |
( |
) |
|
$ |
( |
) |
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$ |
( |
) |
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$ |
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$ |
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$ |
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|||||||
Comprehensive (loss) income |
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|||||||||||
Net (loss) income |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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— |
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— |
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( |
) |
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|
( |
) |
|
Foreign currency translation adjustments |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Total comprehensive (loss) income |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
|
Interest on loans to Karman Topco L.P. |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Equity-based compensation of Karman Topco L.P. |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Shares issued under 2020 Incentive Award Plan |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Stock-based compensation expense |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Balance at June 30, 2023 |
|
|
|
$ |
|
|
|
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||||||
See Notes to the Condensed Consolidated Financial Statements.
5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
Advantage |
|
|
|
|
|
|
|
|||||||||||
|
Common Stock |
|
|
Treasury Stock |
|
|
Additional |
|
|
|
|
|
Loans |
|
|
Other |
|
|
Solutions Inc. |
|
|
|
|
|
Total |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Paid-in |
|
|
Accumulated |
|
|
to |
|
|
Comprehensive |
|
|
Stockholders' |
|
|
Noncontrolling |
|
|
Stockholders' |
|
|||||||||||
(in thousands, except share data) |
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Capital |
|
|
Deficit |
|
|
Topco |
|
|
Income (Loss) |
|
|
Equity |
|
|
Interests |
|
|
Equity |
|
|||||||||||
Balance at January 1, 2024 |
|
|
|
$ |
|
|
|
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||||
Comprehensive (loss) income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net (loss) income |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Foreign currency translation adjustments |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Total comprehensive (loss) income |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Interest on loans to Karman Topco L.P. |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Purchase of treasury stock |
|
( |
) |
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
Equity-based compensation of Karman Topco L.P. |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( | |||||||||||||||||||||||||