2015 A n n u a l
R e v i e w
Letter From The President . . . . . . . . . . . . . . . . . . . 1 Officers & Directors . . . . . . . . . . . . . . . . . . . . . 2 Vision & Values . . . . . . . . . . . . . . . . . . . . . . 4 Financial Highlights . . . . . . . . . . . . . . . . . . . . . 6 2015 Operational Highlights . . . . . . . . . . . . . . . . . . 14 Profit Sharing Plan & ESOP Plan Summary . . . . . . . . . . . . . 20
T
he following Annual Report provides a review of many of the operational highlights for Allgeier Martin in 2015, our 61st year of operation, and sets out the company’s financial position at the year’s end. As you review this report, please keep in mind that the the company’s success is the result of your cumulative efforts on its, and our customer’s, behalf. The company’s $15.44 million in revenues for 2015 fell short of the previous year’s $15.9 million, but overall it was a very good year financially. Of these revenues, over $12.2 million directly benefited employees in the form of wages, social security tax payments, insurance premiums, and contributions to individual’s profit sharing accounts. Company contributions to the profit sharing plan amounted to approximately 14 percent of participant’s annual wages in 2015. Forty years ago I joined Allgeier Martin knowing that it was an established and well thought of firm that I believed would offer engineering challenges while also providing an opportunity for professional advancement. Early on it became evident that the company’s values of client first, hard work, integrity, and honesty aligned well with mine. I am pleased that that these values continue today, and it is no surprise that a number of our current clients have been with the firm longer than I have. All indications are that 2016 will be another productive and profitable year with many of the usual challenges. Thank you for helping us meet these challenges, and best wishes to all. Sincerely,
Dean A. Willis, P.E. President
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Officers & Directors Officers Dean A. Willis . . . . . . . . . . . . . . . . . . . . . . . . . President William M. Thompson . Sr. Vice President & Chairman of the Board Steven C. McNabb . . . . . . . . . . . . . . . . . First Vice President Glen R. Davidson . . . . . Executive Vice President/CFO & Treasurer A. Eugene Spears . . . . . . . . . . . . . . . . . . . Sr. Vice President Barton J. Nichols . . . . . . . . . . . . . . Vice President & Secretary Christopher L. Erisman . . . . . .Vice President & Assistant Secretary Kurt E. Higgins . . . . . . . . . . . . . . . . . . . . . .Vice President Joseph P. Wilson . . . . . . . . . . . . . . . . . . . . . Vice President Michael R. Atkinson . . . . . . . . . . . . . . . . . . . Vice President Randall J. Adair . . . . . . . . . . . . . . . . . . . . . .Vice President James Eric DeGruson . . . . . . . . . . . . . . . . . . .Vice President John Riediger . . . . . . . . . . . . . . . . . . . . . . .Vice President Monnie D. Sears . . . . . . . . . . . . . . . . . . Assistant Secretary
Directors Back Row Christopher L. Erisman, Barton J. Nichols, Randall J. Adair, Kurt E. Higgins, Glen R. Davidson Front Row Steven C. McNabb, William M. Thompson, Dean A. Willis
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For over 61 years, Allgeier, Martin and Associates, Inc. has sought to be our clients’ most trusted engineering advisor. This continues to be our vision going forward. In order to obtain our vision, we strive to be truthful in our business dealings, be thorough in our work, demonstrate personal responsibility, and listen to our clients’ needs and ideas.
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2015 Financial Highlights
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Statements of Assets, Liabilities, and Stockholders’ Equity | Cash Basis
Statement of Revenues and Expenses | Cash Basis For Years Ending December 31, 2015 - 2011
For Years Ending December 31, 2015 - 2011
2015
2014
2013
2012
2011
Assets:
2014
2013
2012
2011
Revenues:
Cash and cash equivalents Prepaid expenses
$2,838,941
$2,998,066
$2,533,907
$1,976,229
$1,578,120
$210,910
$222,151
$220,619
$155,459
$180,784
Land
$78,740
$78,740
$78,740
$78,740
$78,740
Property and equipment (net)
$58,958
$52,598
$56,381
$70,256
$98,324
$6,988
$7,676
$6,658
$8,782
$8,661
$3,194,537
$3,359,231
$2,896,305
$2,289,466
$1,944,629
Other assets Total Assets
Liabilities: Deferred reimbursements
$11,142
$5,028
$13,003
$13,876
$12,936
Notes payable
-
-
-
-
-
Other liabilities
$871
$1,215
$1,052
$126
$122
Client Prepayment Accrued profit sharing plan Total Liabilities
Fees Collected
$15,392,253 $15,923,897 $14,405,279
Deposit on plans Other income Total Revenues
$13,777,575 $13,073,538
-
-
$15,810
$15,335
$28,450
$47,886
$67,549
$36,209
-$8,638
$64,727
$15,440,139 $15,991,446 $14,457,298 $13,784,272
$13,166,715
Expenses: Salaries and compensation
$9,067,778
$8,818,020
$8,404,392
$8,142,486
$7,923,193
Employee taxes and benefits
$1,823,998
$1,769,645
$1,655,348
$1,636,322
$1,561,457
Employee profit sharing plans
$1,313,156
$1,522,063
$1,220,269
$1,215,062
$1,204,544
$97,016
$99,782
$93,912
$94,336
$76,465
Office equipment and expense Field equipment and expense
$482,177
$623,268
$610,005
$714,084
$609,443
Subcontracted services
$229,038
$698,265
$184,171
$215,119
$234,244
-
-
-
$15,975
-
$1,000,000
$1,250,000
$950,000
$950,000
$950,000
Liability insurance expense
$287,649
$304,464
$308,785
$285,226
$271,805
$1,012,013
$1,256,243
$964,055
$979,977
$963,058
Utilities, rent and maintenance
$552,239
$546,231
$532,702
$542,758
$465,421
Depreciation and amortization
$507,057
$324,827
$341,387
$338,810
$311,674
Professional services
$54,008
$41,983
$107,139
$85,910
$92,713
Administrative expenses
$79,807
$67,065
$151,534
$215,729
$187,273
Data processing expenses
$182,956
$193,362
$98,562
Professional and promotion
$156,569
$176,635
$140,594
$112,686
$105,405
$51,415
$43,296
$40,322
$41,468
$38,343
Stockholders’ Equity: Capital stock (plus Paid in Capital)
$2,182,524
$1,905,240
$1,855,346
$1,765,840
$1,602,661
Treasury stock
-$4411,876
-$348,933
-$214,797
-$387,895
-$561,260
Retained earnings
$421,537
$90,585
-$187,506
-$112,258
-$174,484
Excess Revenues over Expenses
$188,859
$456,096
$479,207
$43,802
$114,654
Total Stockholder’s Equity
$2,182,524
$2,102,988
$1,932,250
$1,309,489
$981,571
Total Liabilities & Stockholders’ Equity
$3,194,537
$3,359,231
$2,896,305
$2,289,466
$1,944,629
Additional Information Accounts Receivable (Adjusted)
$1,393,015
$992,371
$1,301,785
$1,282,358
$1,108,985
Work in Process
$1,780,132
$1,640,819
$1,579,609
$1,427,949
$1,386,724
Financial statements are prepared on the cash basis of accounting, a comprehensive basis of accounting other than generally accepted accounting principles. 8
2015
Other expenses Total Expenses
$14,884,917 $15,228,906
$13,889,122 $13,639,996 $13,081,980
Excess Revenues Over Expenses Before Taxes
$555,222
$762,540
$568,176
$144,276
$84,735
Income Taxes
$366,363
$306,444
$88,969
$117,377
-$29,919
Excess Revenues Over Expenses After Taxes
$188,859
$456,096
$479,207
$26,899
$114,654
Financial statements are prepared on the cash basis of accounting, a comprehensive basis of accounting other than generally accepted accounting principles. 9
Distribution Cooperative 15% G&T Cooperative 28.5%
Utilities 14.6% Other Design Professionals 5.8%
Government 31.6%
types of clients cost to employ
Other 3.8% Industrial 1.7%
$53.36 Retirement Plan $13.69
Paid Time Off $10.48
BENEFITS 401(k) Match $4.29
Taxes $8.52
OF
Insurance $16.38
PER $100 PAID IN WAGES
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Total Revenues F o r
2 0 1 5
E q u a l
$15,440,139 $15 Million
$10 Million
$5 Million
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2001
2002
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2006
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2009
2010
2011
2012
2013
2014
2015 13
2015 Operational Highlights
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Significant improvements in Information Technology were completed in 2015. Two outside IT vendor/consultants performed independent audits of our network. This produced a detailed list of deficits to be addressed and best-practice recommendations. What followed was an investment of over $220,000 for a major renovation of the network. Upgrades included: • Migration of all data from our old SAN to two new, redundant on-site SANs with extra capacity • Two new virtual machine (VM) host-servers • Four new high-speed switches for improved intranetwork connectivity • Moved two existing external servers to off-line contingency (back up) duty • Replaced all network CAT5 cabling that served the Electrical, Right-of-Way, and most of Civil with new Gbs speed-capable CAT6 • Installed a new switch cabinet in Electrical, and connected it to the Server Room with new fiber optic cable Anti-virus protection software packages were evaluated over a three month period. Following that evaluation, we migrated corporate-wide to new A-V software from ESET. After our vendors verified that Windows 10 is compatible with their applications, the new operating system was migrated to all of our client desktops. This marks the second consolidated client conversion in the past five years, and will make future conversions to the latest business software systems more fluid, such as conversions coming later this year to Office2016 and Exchange Server 2016. A new Sokia GPS Base and Rover, with external antenna, was purchased and placed in service in 2015.
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The company signed a contract with MC Power Companies to design and install a 25kW roof-mount PV solar panel array, which is to be installed in the first quarter of 2016. The company purchased a used 250 KW generator to serve as a reliable standby power source in the event of outages. The gen-set is being refurbished, and is scheduled to be installed in the first quarter of 2016. Four new trucks were purchased and placed in service in 2015. An ASE Communications Protocol Test Set was purchased in 2015. The test set is used to identify equipment on networks. The company purchased a Transformer Turns Ratio Meter from Vanguard Instruments. Landscaping improvements on the west and north sides of property were completed, including installation of landscape irrigation. Allgeier Martin’s Family Fun Day for 2015 was held on September 19 at Victory Ministry & Sports Complex. Approximately 200 employees and guests attended.
$27,177
125
COMPANY CONTRIBUTIONS
EMPLOYEES
as of 12/31/2015 payroll
To Charities & Others. Up 7.4% over 2014
New Employees Howard South Bud Appleby Robert Sell Scott Marlin Rowland Harmon Michael Walmsley Martha Boley Ryan Gregory Jonathon Carr
Civil Electrical Civil Electrical Civil Electrical Corporate Electrical Electrical
Registered Land Surveyor Project Representative Engineer Engineer Construction Inspector Drafter Clerk/Assistant Survey Crew Member Drafter
13 UNITS
of blood were donated in 2015 by employees at blood drives conducted by the Community Blood Center.
119
EMPLOYEES
Made individual contributions to the 401(k) plan as of 12/31/2015. Total individual contributions in 2015 were $416,656 to conventional 401(k) plans, and $139,580 was contributed to Roth 401(k) plans.
97
EMPLOYEES
Participated in the Medical Expense Reimbursement Plan. Contributions to the plan for health insurance premiums & out-of-pocket expenses totaled
$458,275. A new company website,
www.amce.com
was developed and launched in December of 2015.
Retirements Beth Elsten Karl Kinler
15 Years 38 Years
44
EMPLOYEES
Participated in the Joplin Metro Credit Union. 17
Family Fun Day 18
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Profit Sharing Plan & ESOP Plan Summary
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Profit Sharing Plan Summar y Profit Sharing Plan
0
12/31/2014
12/31/2015
$22,057,708
$23,780,578
25,506
72,939
Employee 401(k)
396,689
416,656
Employee Roth
123,272
139,580
Employer Profit Sharing
949,823
1,252,632
Employer Match
272,063
313,156
(1,162,766)
(868,097)
(297)
(1,082)
177
(2,632)
BrightScope Rating
86
Account Summary
0
Account Value Beginning of Period Contributions Rollover
0
$15 Million
0
Withdrawals Fees Forfeitures Investment Gain (Loss)
1,118,403
160,735
$23,780,578
$25,264,465
Employee Rollover
$467,859
$500,175
Employee 401(k)
6,705,838
7,020,038
480,122
612,852
13,361,037
14,106,983
2,765,722
3,024,417
$23,780,578
25,264,465
Account Value End of Period
0
$10 Million
Lowest Rating in Peer Group
0
10
30
40
50
60
Employer Profit Sharing Employer Match Total
$5 Million
0
80
90
100
BrightScope rates Allgeier Martin’s Profit Sharing Plan as one of the highest in our peer group. https://www.brightscope.com/401k-rating/226692/Allgeier-Martin-Associates-Inc/230462/Allgeier-Martin-AssociatesInc-Employees-401K-Profit-Sharing-Plan/
C
Employee Roth
0
Highest Rating in Peer Group
70
Summary of Sources
0
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A
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I
V
E
COMPANY CONTRIBUTIONS To Profit Sharing Plan Through 2015 Equal
$18,697,416
The year 2015 profit allocation of $1,000,000 is not reflected in the following tabulation. The actual contribution was made in January, 2016. As of 12/31/2015 there were 125 employees participating in the Profit Sharing Plan. Of these, 116 (93%) were also participating in the 401(k) portion of the Plan. Those individuals participating in the 401(k) Plan deferred an average of 6.5% of salary, with individual contributions ranging from 1% to 30%. The chart on this page depicts company contributions to the Profit Sharing Plan since its inception in 1981.
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Average Rating in Peer Group
80 22
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Employee Profit Sharing Plan The Employee Profit Sharing Plan was originally established by the Board of Directors in 1981. The Plan has been amended and improved over the years, and now includes Roth and conventional 401(k) provisions with company match of employees’ deferrals, and daily valuations of employee’s accounts. The Plan allows employees to contribute either pre-tax or after-tax dollars and the associated company match to their own self-directed retirement account, while also allowing for additional company contributions to the Plan. These additional company contributions are determined by the Board at the end of each
00000
$1600 $1500
00000
$1400
Design
$1200
$1000 $900 $800
Performance
Thousands
$1100
$700 $600 $500
00000
PROFIT
SHARING
CONTRIBUTIONS F o r
2 0 1 5
E q u a l
$1,313,156
Total individual 401(k) contributions are not shown. The chart on this page depicts company contributions to the Employee Stock Ownership and Profit Sharing plans since they were established in 1981 and 1992 respectively.
Profit Sharing
401k Match
ESOP
Total
Plan Component Ratings from BrightScope.com
$1300
00000
year after reviewing company profits. At year-end 2015, the Board of Directors elected to contribute $1,000,000 to the Plan. Plan participants receive quarterly statements which reflect individual contributions, company contributions, and previous earnings, and they also have daily access to their accounts via Internet access or by telephone.
Total Plan Cost
Lowest Fees
Company Generosity
Great
Participation Rate
Great
Salary Deferrals
Above Average
Account Balances
Great
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Employee Stock Ownership Plan
0
In 1992 the Employee Stock Ownership Plan (ESOP) was established with stock purchased from Kent Martin, Vernon Lawson and Emmett Green. Company contributions to the ESOP allowed it to be fully funded by 1995. Employees who are participants in the ESOP, or who are eligible to become participants in years when contributions are made to the ESOP, receive distributions of the stock purchased by the ESOP with those contributions. Stock values dictate account balances in the ESOP, and these balances are reported annually to ESOP participants.
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0 150
0
• ESOP balance on 12/31/2014: $1,655,139 • 9,117 shares of company stock owned by ESOP • Each share valued at $181.53/share, plus a cash account balance of $130 • Participants redeemed approximately 512 shares of stock from the ESOP in 2015 • Total value of $92,856 redeemed in 2015, leaving 8,605 shares of stock in the ESOP on 12/31/2015. The annual independent ESOP stock valuation has not yet been completed; therefore the 12/31/2015 ESOP balance and associated number of ESOP shares have not been determined.
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Stipulated Stock Price
0
As
of
December
31,
2014
$181.53/share
0 50
0
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www.amce.com 7231 East 24th Street Joplin, MO 64804 417.680.7200 Š2016 Allgeier, Martin and Associates, Inc.