Filing summary
Important entity mismatch: The supplied filing is for Industrea Acquisition Corp., not Concrete Pumping Holdings, Inc. It is a blank-check company’s Form 10-Q for the quarter ended September 30, 2017; the financial statements cover April 7, 2017 (inception) through September 30, 2017. This filing does not provide financial results for Concrete Pumping Holdings.
Business context and reporting period
Industrea was formed to pursue a business combination, with a stated search focus on industrial manufacturing and services. It had not commenced operating activities by September 30, 2017. It completed its IPO on August 1, 2017, raising $230 million gross, and also sold $11.1 million of private placement warrants.
Financial metrics
| Metric | Three months ended September 30, 2017 | Inception through September 30, 2017 |
|---|---|---|
| Operating revenue | None; company reported no operating revenues | None; company reported no operating revenues |
| Interest income | $435,755 | $435,755 |
| Operating loss | $(240,091) | $(240,965) |
| Net income | $144,438 | $143,564 |
| Net income per share | $0.02 basic; $0.01 diluted | $0.02 basic; $0.01 diluted |
- At quarter-end, total assets were $236.3 million, including $235.0 million in the trust account and $986,471 in cash outside the trust. Prepaid expenses were $234,456.
- Total liabilities were $8.3 million, including $8.05 million of deferred underwriting commissions payable only if a business combination is completed. Current liabilities were $222,628. Stockholders’ equity was $5.0 million; $223.0 million of redeemable Class A shares was classified as temporary equity.
- Cash used in operating activities from inception was $319,019; cash used in investing activities was $234.6 million, principally the trust deposit; financing activities provided $235.9 million. Ending cash was $986,471.
- The company reported approximately $1 million of working capital. A $224,403 sponsor loan used to fund offering expenses was repaid in full on August 1, 2017; no outstanding borrowing balance is reported at quarter-end.
Changes, outlook, risks and unusual items
- No meaningful prior-year comparable period is presented; the company was incorporated in April 2017. The filing reports no material changes to previously disclosed risk factors.
- Management expected available working capital and borrowing capacity to cover needs through the earlier of a business combination or August 1, 2019. It anticipated increased public-company, due diligence and transaction expenses.
- The company had 24 months from the August 1, 2017 IPO closing to complete a business combination. If it fails, it must cease operations and redeem public shares, subject to the filing’s terms. Completion is not assured; public shareholders may redeem shares, and additional financing may be needed.
- Trust funds were intended primarily for a business combination; trust interest could be used for taxes. Sponsor indemnification for certain claims against trust assets is subject to exclusions and may not cover all claims.
- Management stated that disclosure controls were effective and that there were no material changes in internal control over financial reporting. No legal proceedings or off-balance-sheet arrangements were reported. The company elected the emerging-growth-company extended transition period for accounting standards.
Key facts investors should verify
- Confirm the filing belongs to Industrea Acquisition Corp., not Concrete Pumping Holdings, Inc., before using it for issuer analysis.
- Verify the trust balance, redeemable-share terms, and the deadline and conditions for a business combination in subsequent filings.
- Monitor transaction costs, liquidity outside the trust, any sponsor or other working-capital loans, and the potential need for additional financing.
- Review the redemption and liquidation provisions, deferred underwriting commission, and sponsor indemnity limitations when assessing funds potentially available to public shareholders.