Filing identity and reporting period
The supplied filing is Industrea Acquisition Corp.’s unaudited Form 10-Q for the quarter ended March 31, 2018—not a filing under the name Concrete Pumping Holdings, Inc. Industrea was a blank-check company seeking an industrial-sector business combination and reported no operating business or operating revenue. Investors should confirm that this is the intended filing.
Financial results and position
| Metric | Three months ended March 31, 2018, unless noted |
|---|---|
| Operating revenue | None; the company had not commenced operations. |
| General and administrative costs | $480,585 |
| Operating loss | $525,622 |
| Trust investment income | $865,822 |
| Income tax expense | $172,365 |
| Net income | $167,835; basic and diluted earnings per share were $0.02 and $0.01. |
| Operating cash flow | $979,833 provided; cash increased by $1,127,317 to $1,955,872. |
| Trust assets | $235,913,372 at March 31, 2018. |
| Liabilities and debt | Total liabilities were $10,479,109, including $8,050,000 of deferred underwriting commissions payable only if a business combination closes. No debt balance was reported. |
| Liquidity | Working-capital deficit of approximately $173,000; management expected available resources to suffice through a business combination or one year after the filing. |
Changes and notable items
- Compared with December 31, 2017, cash rose from $828,555 to $1,955,872, while trust assets increased from $235,195,034 to $235,913,372. Current liabilities increased from $722,930 to $2,429,109, primarily reflecting higher accounts payable. The filing does not provide prior-year first-quarter results for a comparable operating-period comparison.
- The company received $1,275,067 from sellers of a potential target under an expense reimbursement agreement; the proposed transaction was terminated in February 2018. The reimbursement was recorded as an offset to general and administrative costs.
- Net income was driven by trust interest, not operating activity. Operating cash flow also reflected working-capital movements, including an increase in accounts payable.
Outlook, risks, and contingencies
Industrea had to complete a business combination by August 1, 2019, or redeem public shares and liquidate, subject to the filing’s stated terms. Management warned that greater-than-expected due-diligence costs or lower trust interest could constrain funds available before a transaction; additional financing might be needed to complete a combination. Trust funds were principally reserved for that purpose. The company reported no legal proceedings, no material risk-factor changes from its March 29, 2018 Form 10-K, and no off-balance-sheet arrangements. Management stated disclosure controls were effective and reported no material internal-control changes.
Investor verification points
- Verify whether this Industrea Acquisition Corp. 10-Q is the intended filing for Concrete Pumping Holdings, Inc.
- Confirm the status and final accounting of the terminated target discussions and the $1,275,067 reimbursement.
- Review the SPAC’s remaining cash outside the trust, working-capital needs, redemption terms, and August 1, 2019 business-combination deadline.
- Assess the effect of public-share redemptions, deferred underwriting commissions, and any potential sponsor financing on transaction proceeds and dilution.