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Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	May 31, 2014	Aug. 01, 2014	Nov. 30, 2013
Document and Entity Information
Entity Registrant Name	Mistras Group, Inc.
Entity Central Index Key	0001436126
Document Type	10-K
Document Period End Date	May 31, 2014
Amendment Flag	false
Current Fiscal Year End Date	--05-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 340.6
Entity Common Stock, Shares Outstanding		28,456,303
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY

Consolidated Balance Sheets - USD ($) $ in Thousands	May 31, 2014	May 31, 2013
Current Assets
Cash and cash equivalents	$ 10,020	$ 7,802
Accounts receivable, net	137,824	108,554
Inventories	11,376	12,504
Deferred income taxes	3,283	3,293
Prepaid expenses and other current assets	12,626	8,156
Total current assets	175,129	140,309
Property, plant and equipment, net	77,811	68,419
Intangible assets, net	57,875	52,428
Goodwill	130,516	115,270
Deferred income taxes	1,344	665
Other assets	1,297	906
Total assets	443,972	377,997
Current Liabilities
Accounts payable	14,978	8,490
Accrued expenses and other current liabilities	54,650	47,839
Current portion of long-term debt	8,058	7,418
Current portion of capital lease obligations	7,251	6,766
Income taxes payable	1,854	1,703
Total current liabilities	86,791	72,216
Long-term debt, net of current portion	68,590	52,849
Obligations under capital leases, net of current portion	13,664	10,923
Deferred income taxes	15,521	12,951
Other long-term liabilities	17,014	18,778
Total liabilities	201,580	167,717
Commitments and contingencies
Equity
Preferred stock, 10,000,000 shares authorized
Common stock, $0.01 par value, 200,000,000 shares authorized, 28,455,781 and 28,210,862 shares issued and outstanding as of May 31, 2014 and May 31, 2013, respectively	284	282
Additional paid-in capital	201,831	195,241
Retained earnings	41,500	18,982
Accumulated other comprehensive loss	(1,511)	(4,452)
Total Mistras Group, Inc. stockholders' equity	242,104	210,053
Noncontrolling interests	288	227
Total equity	242,392	210,280
Total liabilities and equity	$ 443,972	$ 377,997

Consolidated Balance Sheets (Parenthetical) - $ / shares	May 31, 2014	May 31, 2013
Consolidated Balance Sheets
Preferred stock, shares authorized	10,000,000	10,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	28,455,781	28,210,862
Common stock, shares outstanding	28,455,781	28,210,862

Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	May 31, 2014	May 31, 2013	May 31, 2012
Revenues:
Services	$ 582,916	$ 487,268	$ 394,035
Products and systems	40,531	42,014	42,840
Total revenues	623,447	529,282	436,875
Cost of revenues:
Cost of services	415,970	346,769	271,676
Cost of products and systems sold	16,725	16,276	19,940
Depreciation related to services	16,734	16,963	14,929
Depreciation related to products and systems	1,075	903	640
Total cost of revenues	450,504	380,911	307,185
Gross profit	172,943	148,371	129,690
Selling, general and administrative expenses	123,690	101,792	83,098
Research and engineering	2,995	2,447	2,059
Depreciation and amortization	10,620	8,781	6,455
Acquisition-related expense, net	(2,657)	(2,141)	1,980
Goodwill impairment		9,938
Income from operations	38,295	27,554	36,098
Other expenses:
Interest expense	3,192	3,288	3,132
Gain on extinguishment of long-term debt			(671)
Income before provision for income taxes	35,103	24,266	33,637
Provision for income taxes	12,528	12,627	12,291
Net income	22,575	11,639	21,346
Less: net (income) loss attributable to noncontrolling interests, net of taxes	(57)	7	7
Net income attributable to Mistras Group, Inc.	$ 22,518	$ 11,646	$ 21,353
Earnings per common share
Basic (in dollars per share)	$ 0.79	$ 0.41	$ 0.77
Diluted (in dollars per share)	$ 0.77	$ 0.40	$ 0.74
Weighted average common shares outstanding:
Basic (in shares)	28,365	28,141	27,839
Diluted (in shares)	29,324	29,106	28,685

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	May 31, 2014	May 31, 2013	May 31, 2012
Consolidated Statements of Comprehensive Income
Net income	$ 22,575	$ 11,639	$ 21,346
Other comprehensive (loss) income:
Foreign currency translation adjustments	2,941	(1,407)	(3,361)
Comprehensive income	25,516	10,232	17,985
Less: net income attributable to noncontrolling interests	(57)	7	7
Foreign currency translation adjustments	(4)	2	11
Comprehensive income attributable to Mistras Group, Inc.	$ 25,455	$ 10,241	$ 18,003

Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands	Total	Total Mistras Group, Inc. Stockholders' Equity	Common Stock	Additional paid-in capital	Retained earnings (accumulated deficit)	Accumulated other comprehensive income (loss)	Noncontrolling Interest
Balance at May. 31, 2011	$ 167,486	$ 167,157	$ 277	$ 180,594	$ (14,017)	$ 303	$ 329
Balance (in shares) at May. 31, 2011			27,667
Increase (Decrease) in Stockholders' Equity
Net income	21,346	21,353			21,353		(7)
Other comprehensive income (loss), net of tax	(3,361)	(3,350)				(3,350)	(11)
Share-based payments	5,097	5,097		5,097
Share-based payments (in shares)			16
Net settlement on vesting of restricted stock units	(283)	(283)		(283)
Net settlement on vesting of restricted stock units (in shares)			36
Excess tax benefit from share-based payment compensation	554	554		554
Exercise of stock options	2,484	2,484	$ 3	2,481
Exercise of stock options (in shares)			307
Noncontrolling interest in subsidiary	(75)						(75)
Balance at May. 31, 2012	193,248	193,012	$ 280	188,443	7,336	(3,047)	236
Balance (in shares) at May. 31, 2012			28,026
Increase (Decrease) in Stockholders' Equity
Net income	11,639	11,646			11,646		(7)
Other comprehensive income (loss), net of tax	(1,407)	(1,405)				(1,405)	(2)
Share-based payments	6,285	6,285		6,285
Share-based payments (in shares)			15
Net settlement on vesting of restricted stock units	(809)	(809)	$ 1	(810)
Net settlement on vesting of restricted stock units (in shares)			85
Excess tax benefit from share-based payment compensation	495	495		495
Exercise of stock options	829	829	$ 1	828
Exercise of stock options (in shares)			85
Balance at May. 31, 2013	210,280	210,053	$ 282	195,241	18,982	(4,452)	227
Balance (in shares) at May. 31, 2013			28,211
Increase (Decrease) in Stockholders' Equity
Net income	22,575	22,518			22,518		57
Other comprehensive income (loss), net of tax	2,945	2,941				2,941	4
Share-based payments	6,261	6,261		6,261
Share-based payments (in shares)			19
Net settlement on vesting of restricted stock units	(1,006)	(1,006)	$ 1	(1,007)
Net settlement on vesting of restricted stock units (in shares)			123
Excess tax benefit from share-based payment compensation	340	340		340
Exercise of stock options	997	997	$ 1	996
Exercise of stock options (in shares)			103
Balance at May. 31, 2014	$ 242,392	$ 242,104	$ 284	$ 201,831	$ 41,500	$ (1,511)	$ 288
Balance (in shares) at May. 31, 2014			28,456

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	May 31, 2014	May 31, 2013	May 31, 2012
Cash flows from operating activities
Net income	$ 22,575	$ 11,639	$ 21,346
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	28,429	26,647	22,024
Deferred income taxes	(621)	(1,732)	(984)
Share-based compensation expense	6,261	6,285	5,097
Goodwill impairment		9,938
Fair value adjustments to contingent consideration	(3,937)	(3,727)	174
Other	617	472	(643)
Changes in operating assets and liabilities, net of effect of acquisitions
Accounts receivable	(23,857)	4,772	(18,030)
Inventories	1,203	525	(1,708)
Prepaid expenses and other current assets	(4,059)	(1,042)	(1,503)
Other assets	36	462	(8)
Accounts payable	6,125	(5,478)	3,149
Accrued expenses and other liabilities	4,532	(3,832)	5,524
Income taxes payable	(431)	(1,426)	(3,036)
Net cash provided by operating activities	36,873	43,503	31,402
Cash flows from investing activities
Purchase of property, plant and equipment	(16,871)	(12,530)	(9,592)
Purchase of intangible assets	(708)	(993)	(813)
Acquisition of businesses, net of cash acquired	(21,924)	(33,122)	(29,216)
Proceeds from sale of equipment	1,498	1,166	2,109
Net cash used in investing activities	(38,005)	(45,479)	(37,512)
Cash flows from financing activities
Repayment of capital lease obligations	(8,139)	(6,972)	(6,984)
Repayment of long-term debt	(8,830)	(5,075)	(12,346)
Net repayments of former revolver			(3,850)
Net borrowings from current revolver	21,580	14,568	25,000
Net repayments from other short-term borrowings			(1,868)
Payment of financing costs			(623)
Purchase of remaining noncontrolling interest in subsidiary			(75)
Payment of contingent consideration for business acquisitions	(1,678)	(1,892)
Taxes paid related to net share settlement of equity awards	(1,007)	(809)	(283)
Excess tax benefit from share-based payment compensation	340	495	554
Proceeds from the exercise of stock options	996	829	2,484
Net cash provided by financing activities	3,262	1,144	2,009
Effect of exchange rate changes on cash and cash equivalents	88	224	1,632
Net change in cash and cash equivalents	2,218	(608)	(2,469)
Cash and cash equivalents:
Beginning of period	7,802	8,410	10,879
End of period	10,020	7,802	8,410
Supplemental disclosure of cash paid
Interest	3,271	3,144	2,749
Income taxes	12,920	15,639	14,871
Noncash investing and financing
Equipment acquired through capital lease obligations	11,031	3,886	9,504
Issuance of notes payable and other debt obligations primarily related to acquisitions	$ 336	$ 7,715	$ 3,340

Description of Business and Basis of Presentation	12 Months Ended
Description of Business and Basis of Presentation	May 31, 2014
Description of Business and Basis of Presentation
Description of Business and Basis of Presentation	1. Description of Business and Basis of Presentation *Description of Business* Mistras Group, Inc. and subsidiaries (the Company) is a leading “one source” global provider of technology-enabled asset protection solutions used to evaluate the structural integrity and reliability of critical energy, industrial and public infrastructure. The Company combines industry-leading products and technologies, expertise in mechanical integrity (MI) and non-destructive testing (NDT) services and proprietary data analysis software to deliver a comprehensive portfolio of customized solutions, ranging from routine inspections to complex, plant-wide asset integrity assessments and management. These mission critical solutions enhance customers’ ability to extend the useful life of their assets, increase productivity, minimize repair costs, comply with governmental safety and environmental regulations, manage risk and avoid catastrophic disasters. The Company serves a global customer base of companies with asset-intensive infrastructure, including companies in the oil and gas, fossil and nuclear power, alternative and renewable energy, public infrastructure, chemicals, aerospace and defense, transportation, primary metals and metalworking, pharmaceuticals and food processing industries. *Principles of Consolidation* The accompanying consolidated financial statements include the accounts of Mistras Group, Inc. and its wholly and majority-owned subsidiaries. Where the Company’s ownership interest is less than 100%, the noncontrolling interests are reported in stockholders’ equity in the accompanying consolidated balance sheets. The noncontrolling interests in net income, net of tax, is classified separately in the accompanying consolidated statements of income. All significant intercompany accounts and transactions have been eliminated in consolidation. Mistras Group, Inc.’s and its subsidiaries’ fiscal years end on May 31 except for the subsidiaries in the International segment, which end on April 30. Accordingly, the Company’s International segment subsidiaries are consolidated on a one-month lag. Therefore, in the quarter and year of acquisition, results of acquired subsidiaries in the International segment are generally included in consolidated results for one less month than the actual number of months from the acquisition date to the end of the reporting period. Management does not believe that any events occurred during the one-month lag period that would have a material effect on the Company’s consolidated financial statements. Reference to a fiscal year means the fiscal year ended May 31. *Reclassifications* Certain amounts in prior periods have been reclassified to conform to the current year presentation. Such reclassifications did not have a material effect on the Company’s financial condition or results of operations as previously reported.

- Definition

The entire disclosure for organization, consolidation and basis of presentation of financial statements disclosure.

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+ Details

Summary of Significant Accounting Policies

12 Months Ended

May 31, 2014

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Revenue Recognition

Revenue is generally recognized when persuasive evidence of an arrangement exists, services have been rendered or products have been delivered, the fee is fixed or determinable, and collectability is reasonably assured. The following revenue recognition policies define the manner in which we account for specific transaction types:

Services

Revenue is primarily derived from providing services on a time and material basis. Service arrangements generally consist of inspection professionals working under contract for a fixed period of time or on a specific customer project. Revenue is generally recognized when the service is performed in accordance with terms of each customer arrangement, upon completion of the earnings process and when collection is reasonably assured. At the end of any reporting period, revenue is accrued for services that have been earned which have not yet been billed. Reimbursable costs, including those related to travel and out-of-pocket expenses, are included in revenue, and equivalent amounts of reimbursable costs are included in cost of services.

Products and Systems

Sales of products and systems are recorded when the sales price is fixed and determinable and the risks and rewards of ownership are transferred (generally upon shipment) and when collectability is reasonably assured.

These arrangements generally contain multiple elements or deliverables, such as hardware software (that is essential to the functionality of the hardware) and related services. The Company recognizes revenue for delivered elements as separate units of accounting, when the delivered elements have standalone value, uncertainties regarding customer acceptance are resolved and there are no refund or return rights for the delivered elements. The Company establishes the selling prices for each deliverable based on its, vendor-specific objective evidence (“VSOE”), if available, third-party evidence, if VSOE is not available, or estimated selling price (“ESP”) if neither VSOE nor third-party evidence is available. The Company establishes VSOE of selling price using the price charged for a deliverable when sold separately and, in rare instances, using the price established by management having the relevant authority. Third-party evidence of selling price is established by evaluating largely similar and interchangeable competitor products or services in standalone sales to similarly situated customers. The Company determines ESP, by considering Internal factors such as margin objectives, pricing practices and controls, customer segment pricing strategies and the product life cycle. Consideration is also given to market conditions such as competitor pricing strategies and Industry technology life cycles. When determining ESP, the Company applies management judgment to establish margin objectives and pricing strategies and to evaluate market conditions and product life cycles. Changes in the aforementioned factors may result in a different allocation of revenue to the deliverables in multiple element arrangements and therefore may change the pattern and timing of revenue recognition for these elements, but will not change the total revenue recognized for the arrangement.

A portion of the Company’s revenue is generated from engineering and manufacturing of custom products under long-term contracts that may last from several months to several years, depending on the contract. Revenues from long-term contracts are recognized on the percentage-of-completion method of accounting. Under the percentage-of-completion method of accounting revenues are recognized as work is performed. The percentage of completion at any point in time is generally based on total costs or total labor dollars incurred to date in relation to the total estimated costs or total labor dollars estimated at completion. The percentage of completion is then applied to the total contract revenue to determine the amount of revenue to be recognized in the period. Application of the percentage-of-completion method of accounting requires the use of estimates of costs to be incurred for the performance of the contract. Contract costs include all direct materials, direct labor costs and those indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs, and all costs associated with operation of equipment. The cost estimation process is based upon the professional knowledge and experience of our engineers, project managers and financial professionals. Factors that are considered in estimating the work to be completed include the availability and productivity of labor, the nature and complexity of the work to be performed, the effect of change orders, the availability of materials, the effect of any delays in our project performance and the recoverability of any claims. Whenever revisions of estimated contract costs and contract values indicate that the contract costs will exceed estimated revenues, thus creating a loss, a provision for the total estimated loss is recorded in that period.

Use of Estimates

The preparation of financial statements in accordance with generally accepted accounting principles requires that the Company make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and disclosure of contingent assets and liabilities at the date of financial statements. The accounting policies that the Company believes require more significant estimates and assumptions include: revenue recognition, valuations of accounts receivable, long lived assets, goodwill, and deferred tax assets and uncertain tax positions. The Company bases its estimates and assumptions on historical experience, known or expected trends and various other assumptions that it believes to be reasonable. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates, which may cause the Company’s future results to be significantly affected.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Accounts Receivable

Accounts receivable are stated net of an allowance for doubtful accounts and sales allowances. Outstanding accounts receivable balances are reviewed periodically, and allowances are provided at such time that management believes it is probable that such balances will not be collected within a reasonable period of time. The Company extends credit to its customers based upon credit evaluations in the normal course of business, primarily with 30-day terms. Bad debts are provided for based on historical experience and management’s evaluation of outstanding accounts receivable. Accounts are generally written off when they are deemed uncollectible.

Inventories

Inventories are stated at the lower of cost, as determined by using the first-in, first-out method, or market. Work in process and finished goods inventory include material, direct labor, variable costs and overhead.

Software Costs

Costs that are related to the conceptual formulation and design of licensed software are expensed as research and engineering. For software the Company licenses to customers, the Company capitalizes costs that are incurred between the date technological feasibility has been established and the date that the product becomes available for sale. Capitalized amounts are amortized over three years, which is the estimated life of the related software. The Company performs periodic reviews to ensure that unamortized program costs remain recoverable from future revenues. Costs to support or service these licensed programs are expensed as the costs are incurred.

The Company capitalizes certain costs that are incurred to purchase or to create and implement internal-use software, which includes software coding, installation and testing. Capitalized costs are amortized on a straight-line basis over three years, the estimated useful life of the software.

Property, Plant and Equipment

Property, plant and equipment are recorded at cost. Depreciation of property, plant and equipment is computed utilizing the straight-line method over the estimated useful lives of the assets. Amortization of leasehold improvements is computed utilizing the straight-line method over the shorter of the remaining lease term or estimated useful life. Repairs and maintenance costs are expensed as incurred.

Goodwill

Goodwill represents the excess of the purchase price of acquired businesses over the fair values attributed to underlying net tangible assets and identifiable intangible assets. We test the carrying value of goodwill for impairment at a “reporting unit” level (which for the Company is represented by (i) our Services segment, (ii) our Products and Systems segment, and (iii) the European component and (iv) Brazilian component of our International segment), using a two-step approach, annually as of March 1, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. If the fair value of a reporting unit is less than its carrying value, this is an indicator that the goodwill assigned to that reporting unit may be impaired. In this case, a second step is performed to allocate the fair value of the reporting unit to the assets and liabilities of the reporting unit as if it had just been acquired in a business combination, and as if the purchase price was equivalent to the fair value of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to its assets and liabilities is referred to as the implied fair value of goodwill. The implied fair value of the reporting unit’s goodwill is then compared to the actual carrying value of goodwill. If the implied fair value is less than the carrying value, we would be required to recognize an impairment loss for that excess. We consider the income and market approaches to estimating the fair value of our reporting units, which requires significant judgment in evaluation of, among other things, economic and industry trends, estimated future cash flows, discount rates and other factors.

As of May 31, 2014, the carrying amount of our goodwill was approximately $130.5 million, of which approximately $43.6 million relates to our International segment. A significant portion of our international operations are concentrated in our Europe and Brazil reporting units. The economic environments in Europe and Brazil were difficult in 2013, with signs of recovery especially in Europe in fiscal 2014. As a result of a contraction in the Brazilian economy (specifically in the oil and gas industry), in the fourth quarter of fiscal 2013 we recognized goodwill impairment in our Brazil reporting unit of approximately $9.9 million. Significant deterioration in industry or economic trends, disruptions to our business, inability to effectively integrate acquired businesses, or other factors, may cause further impairment charges to goodwill in future periods.

Impairment of Long-lived Assets

The Company reviews the recoverability of its long-lived assets on a periodic basis in order to identify indicators of a possible impairment. The assessment for potential impairment is based primarily on the Company’s ability to recover the carrying value of its long-lived assets from expected future undiscounted cash flows. If the total expected future undiscounted cash flows are less than the carrying amount of the assets, a loss is recognized for the difference between fair value (computed based upon the expected future discounted cash flows) and the carrying value of the assets.

Shipping and Handling Costs

Shipping and handling costs are included in cost of revenues.

Taxes Collected from Customers

Taxes collected from customers and remitted to governmental authorities are presented in the consolidated statements of income on a net basis.

Research and Engineering

Research and product development costs are expensed as incurred.

Advertising, Promotions and Marketing

The costs for advertising, promotion and marketing programs are expensed as incurred and are included in selling, general and administrative expenses. Advertising expense was approximately $1.8 million, $1.7 million and $1.1 million for fiscal 2014, 2013 and 2012, respectively.

Fair Value of Financial Instruments

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and other financial current assets and liabilities approximate fair value based on the short-term nature of the items. The carrying value of long-term debt approximates fair value due to the variable-rate structure of the debt. The fair value of the Company’s notes payable and capital lease obligations approximate their carrying amounts as those obligations bear interest at rates which management believes would currently be available to the Company for similar obligations.

Foreign Currency Translation

The financial position and results of operations of the Company’s foreign subsidiaries are measured using their functional currencies, which, is their local currency. Assets and liabilities of foreign subsidiaries are translated into the U.S. Dollar at the exchange rates in effect at the balance sheet date. Income and expenses are translated at the average exchange rate during the period. Translation gains and losses are reported as a component of other comprehensive income for the period and included in accumulated other comprehensive income within stockholders’ equity.

Foreign currency (gains) and losses arising from transactions denominated in currencies other than the functional currency are included in net income reported in SG&A expenses and were approximately $0.1 million, $0.1 million and ($0.5) million in fiscal 2014, 2013 and 2012, respectively.

Derivative Financial Instruments

The Company recognizes its derivatives as either assets or liabilities, measures those instruments at fair value and recognizes the changes in fair value of the derivative in net income or other comprehensive income, as appropriate. Prior to fiscal 2013, the Company hedged a portion of its variable rate interest payments on debt using interest rate swap contracts to convert variable payments into fixed payments. The Company did not apply hedge accounting to their interest rate swap contracts. Changes in the fair value of these instruments were reported as a component of interest expense. As of May 31, 2014 and 2013, the Company had no outstanding interest rate swap contracts.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and accounts receivable. At times, cash deposits may exceed the limits insured by the Federal Deposit Insurance Corporation. The Company believes it is not exposed to any significant credit risk or risk of nonperformance of financial institutions.

The Company has one customer which accounted for 11% and 16% of revenues for fiscal 2013 and 2012, respectively. Accounts receivable from this customer was approximately 9% of total accounts receivable, net, at May 31, 2013. Our relationship with this customer comprised of separate contracts for non-destructive testing and inspection services with multiple affiliated entities within their broad organization. These contracts are typically negotiated locally with the specific location, are of varying lengths, have different start and end dates and differ in terms of the scope of work and nature of services provided. Most contracts are based on time and materials.

Self-Insurance

The Company is self-insured for certain losses relating to workers’ compensation and health benefits claims. The Company maintains third-party excess insurance coverage for all workers compensation and health benefit claims in excess of approximately $0.3 million to reduce its exposure from such claims. Self-insured losses are accrued when it is probable that an uninsured claim has been incurred but not reported and the amount of the loss can be reasonably estimated at the balance sheet date.

Share-based Compensation

We measure the value of services received from employees and directors in exchange for an award of an equity instrument based on the grant-date Fair Value of the award. The computed value is recognized as a non-cash cost on a straight-line basis over the period the individual provides services, which is typically the vesting period of the award with the exception of awards containing an internal performance measure which is recognized on a straight-line basis over the vesting period subject to the probability of meeting the performance requirements and adjusted for the number of shares expected to be earned. As share-based compensation expense is based on awards ultimately expected to vest, the amount of expense has been reduced for estimated forfeitures. The cost of these awards is recorded in selling, general and administrative expense in the company’s consolidated statements of income.

There were no stock options granted in fiscal 2014 and 2013. The following table presents the assumptions used in the Black-Scholes option-pricing model during fiscal 2012 for awards made to employees:

Dividend yield	0.0	%
Expected volatility	37	%
Risk-free interest rate	1.1	%
Expected term (years)	6.25

In fiscal 2014, the company granted performance restricted stock units containing service, performance and market conditions to the Company’s executive and certain other senior officers. These units have requisite service periods of three years and have no dividend rights. The performance condition is compounded annual growth rate for adjusted earnings per share, as defined in the plan agreement, which accounts for 75% of the awards. The grant-date fair value was used to value the awards related to the performance condition. The market condition is a relative total shareholder return (“TSR”) which accounts for 25% of the awards. The following table presents the assumptions used in a Monte Carlo simulation model to value the TSR components of the grants issued in fiscal 2014:

Dividend yield	0.0	%
Expected volatility	38	%
Risk-free interest rate	0.7	%
Expected term (years)	2.6

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credit carry-forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided if it is more likely than not that some or all of a deferred income tax asset will not be realized. Financial accounting standards prescribe a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. These standards also provide guidance on de-recognition, measurement, and classification of amounts relating to uncertain tax positions, accounting for and disclosure of interest and penalties, accounting in interim periods and disclosures required. Interest and penalties related to unrecognized tax positions are recognized as incurred within “provision for income taxes” in the consolidated statements of income.

Earnings per Share

12 Months Ended

May 31, 2014

Earnings per Share

Earnings per Share

3. Earnings per Share

Basic earnings per share is computed by dividing net income attributable to common shareholders by the weighted average number of shares outstanding during the period. Diluted earnings per share is computed by dividing net income attributable to common shareholders by the sum of (1) the weighted average number of shares of common stock outstanding during the period, and (2) the dilutive effect of assumed conversion of equity awards using the treasury stock method. With respect to the number of weighted average shares outstanding (denominator), diluted shares reflects: (i) only the exercise of options to acquire common stock to the extent that the options’ exercise prices are less than the average market price of common shares during the period and (ii) the pro forma vesting of restricted stock units.

The following table sets forth the computations of basic and diluted earnings per share:

	For the year ended May 31,
	2014		2013		2012
Basic earnings per share
Numerator:
Net income attributable to Mistras Group, Inc.	$	22,518	$	11,646	$	21,353
Denominator
Weighted average common shares outstanding	28,365		28,141		27,839
Basic earnings per share	$	0.79	$	0.41	$	0.77

Diluted earnings per share:
Numerator:
Net income attributable to Mistras Group, Inc.	$	22,518	$	11,646	$	21,353
Denominator
Weighted average common shares outstanding	28,365		28,141		27,839
Dilutive effect of stock options outstanding	775		804		737
Dilutive effect of restricted stock units outstanding	184		161		109
	29,324		29,106		28,685
Diluted earnings per share	$	0.77	$	0.40	$	0.74

The following potential common shares were excluded from the computation of diluted earnings per share, as the effect would have been anti-dilutive:

	For the year ended May 31,
	2014	2013	2012

Potential common stock attributable to stock options outstanding	5	5	5
Potential common stock attributable to performance awards outstanding	121	—	—
Total	126	5	5

Accounts Receivable, net

12 Months Ended

May 31, 2014

Accounts Receivable, net

Accounts Receivable, net

4. Accounts Receivable, net

Accounts receivable consist of the following:

	May 31,
	2014			2013

Trade accounts receivable	$	140,120		$	110,438
Allowance for doubtful accounts	(2,296		)	(1,884		)
Accounts receivable, net	$	137,824		$	108,554

The Company had $16.9 million and $8.1 million of unbilled revenues accrued for fiscal 2014 and 2013, respectively. Unbilled revenues for fiscal 2014 are expected to be billed in the first quarter fiscal 2014.

- Definition

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

+ References + Details

Inventories

12 Months Ended

May 31, 2014

Inventories

Inventories

5. Inventories

Inventories consist of the following:

	May 31,
	2014		2013

Raw materials	$	3,663	$	3,332
Work in progress	2,069		2,310
Finished goods	3,462		4,355
Services-related consumable supplies	2,182		2,507
Inventory	$	11,376	$	12,504

Property, Plant and Equipment, net

12 Months Ended

May 31, 2014

Property, Plant and Equipment, net

Property, Plant and Equipment, net

6. Property, Plant and Equipment, net

Property, plant and equipment consist of the following:

	May 31,
	Useful Life	2014			2013
	(Years)
Land		$	1,938		$	1,943
Building and improvements	30-40	22,983			20,973
Office furniture and equipment	5-8	7,169			7,244
Machinery and equipment	5-7	144,798			119,862

		176,888			150,022
Accumulated depreciation and amortization		(99,077		)	(81,603		)
Property, plant and equipment, net		$	77,811		$	68,419

Depreciation expense was approximately $19.2 million, $18.9 million and $16.4 million for the years ended May 31, 2014, 2013 and 2012, respectively.

Acquisitions

12 Months Ended

May 31, 2014

Acquisitions

Acquisitions

7. Acquisitions

During fiscal 2014, the Company completed the acquisition of six companies. Five of these companies are intended to complement the service offerings within the Services segment. The other company, located in Russia, is intended to complement the service offerings within the International segment and to continue its market expansion strategy. In these acquisitions, the Company acquired 100% of the common stock or certain assets of each acquiree in exchange for aggregate consideration of approximately $22.3 million in cash and accounted for such transactions in accordance with the acquisition method of accounting for business combinations. In addition to the cash consideration related to these acquisitions, the Company accrued a liability of approximately $4.0 million, which represents the estimated fair value of contingent consideration expected to be payable in the event that the acquired companies achieve specific performance metrics during various periods over the next three years of operations. The estimated total potential contingent consideration for these acquisitions ranges from zero to $6.2 million as of May 31, 2014.

During fiscal 2013, the Company completed the acquisition of three asset protection companies specializing in destructive and non-destructive services and inspection, and in-house component inspection. Two of these companies are intended to complement the service offerings within the International segment and to expand Mistras’ footprint in Europe. The other company, located in Canada, is intended to complement the service offerings within the Services segment. In these acquisitions, the Company acquired 100% of the common stock of each acquiree in exchange for an aggregate of approximately $35.0 million in cash and $7.7 million in notes payable over three years and accounted for such transactions in accordance with the acquisition method of accounting for business combinations. In addition to the cash and debt consideration related to these acquisitions, the Company accrued a liability of approximately $8.3 million, which represents the estimated fair value of contingent consideration expected to be payable in the event that the acquired companies achieve specific performance metrics over the next five years of operations.

The Company completed the acquisition of eleven companies during fiscal 2012. These acquisitions were for asset protection companies specializing in advanced ultrasonic inspection, NDT services and inspection, ultrasonic testing (UT) and acoustic emission (AE) products and systems, and in-house component inspection. These companies were acquired to complement the service and product offerings within the Services, Products and Systems, and International segments. Seven of the acquired companies have been integrated into the International segment; three of the acquired companies have been integrated into the Services segment; and one of the acquired companies has been integrated into the Products segment. The aggregate consideration totaled approximately $30.5 million in cash and $3.3 million in notes payable. In addition to the cash and debt consideration related to the acquisitions completed in fiscal 2012, the Company accrued a liability of approximately $8.5 million, which represents the estimated fair value of contingent consideration expected to be payable in the event that certain of the acquired companies achieve specific performance metrics over the next four years of operations.

Assets and liabilities of the acquired businesses were included in the consolidated balance sheets as of May 31, 2014 based on their estimated fair value on the date of acquisition as determined in a purchase price allocation, using available information and making assumptions management believes are reasonable. The results of operations of each of the acquisitions completed in fiscal 2013 are included in each respective operating segment’s results of operations from the date of acquisition. The Company’s allocation of purchase price for these acquisitions is included in the table below. The following table summarizes the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition for fiscal 2014:

	2014			2013			2012

Number of entities	6			3			11

Cash paid	$	22,272		$	34,968		30,453
Subordinated notes issued	—			7,715			3,348
Contingent consideration	3,967			8,330			10,625

Consideration paid	$	26,239		$	51,013		44,426

Current net assets	3,133			761			(5,773	)
Debt and other long-term liabilities	(2,226		)	(4,540		)	(9,106	)
Property, plant and equipment	1,566			8,945			14,260
Deferred tax liability	(2,248		)	(7,654		)	(1,746	)
Intangibles	12,993			25,491			11,934
Goodwill	13,021			28,010			34,857
Net assets acquired	$	26,239		$	51,013		44,426

The amortization period for intangible assets acquired ranges from two to twelve years. The Company recorded approximately $13.0 million and $28.0 million of goodwill in connection with its fiscal 2014 and 2013 acquisitions, respectively, reflecting the strategic fit and revenue and earnings growth potential of these businesses. The goodwill recorded in fiscal 2014 and 2013 relates primarily to the acquisition of the common stock of the acquiree, which is generally not deductible for tax purposes.

We are continuing our review of our fair value estimate of assets acquired and liabilities assumed for two entities disclosed above. This process will conclude as soon as we finalize information regarding facts and circumstances that existed as of the acquisition date. Goodwill and intangibles for these two entities totaled $0.8 million and $2.2 million, respectively. This measurement period will not exceed one year from the acquisition date.

Revenue included in the consolidated statement of operations for fiscal 2014 from these acquisitions for the period subsequent to the closing of each transaction was approximately $16.3 million. Aggregate income from operations included in the consolidated statement of operations for fiscal 2014 from these acquisitions for the period subsequent to the closing of each transaction was approximately $1.2 million. As these acquisitions are not significant to the Company’s fiscal 2014 results, no unaudited pro forma financial information has been included in this report.

In the course of its acquisition activities, the Company incurs costs in connection with due diligence, professional fees, and other expenses. Additionally, the Company adjusts the fair value of certain acquisition-related contingent consideration liabilities on a quarterly basis. These amounts are recorded as acquisition-related expense, net, on the consolidated statements of income and were as follows for fiscal 2014, 2013 and 2012:

	For the years ended May 31,
	2014			2013			2012

Due dilgence, professional fees and other transaction costs	$	1,280		$	1,586		$	1,806
Adjustments to fair value of contingent consideration liabilities	$	(3,937	)	$	(3,727	)	$	174
Acquisition-related expense, net	$	(2,657	)	$	(2,141	)	$	1,980

The Company’s contingent consideration liabilities are recorded on the balance sheet in accrued expenses and other liabilities.

- Definition

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 5
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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-Paragraph 1
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
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-SubTopic 10
-Section 50
-Paragraph 7
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Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-Name Accounting Standards Codification
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
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Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 15: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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+ Details

Goodwill

12 Months Ended

May 31, 2014

Goodwill

Goodwill

8. Goodwill

The changes in the carrying amount of goodwill by segment is shown below:

	Services			International			Products			Total

Balance at May 31, 2012	$	58,746		$	24,481		$	13,592		$	96,819
Goodwill acquired during the year	2,126			25,884			—			28,010
Adjustments to preliminary purchase price allocations	516			780			(395		)	901
Goodwill impairment	—			(9,938		)	—			(9,938		)
Foreign currency translation	(103		)	(419		)	—			(522		)
Balance at May 31, 2013	$	61,285		$	40,788		$	13,197		$	115,270
Goodwill acquired during the year	15,558			232			—			15,790
Adjustments to preliminary purchase price allocations	(2,769		)	440			—			(2,329		)
Foreign currency translation	(307		)	2,092			—			1,785
Balance at May 31, 2014	$	73,767		$	43,552		$	13,197		$	130,516

In the fourth quarter of fiscal 2013, as a result of a contraction in the Brazil economy, the Company experienced reduced demand for inspection services and a decline in recent and projected operating results. As a result of the completion of step one of the impairment analysis, the Company concluded that, as of March 1, 2013, the fair value of the Brazil reporting unit was below its respective carrying value and the step two analysis was performed. The Company recorded a goodwill impairment charge in the amount of $9.9 million related to Brazil which is reflected in the International segment in fiscal 2013.

Intangible Assets

12 Months Ended

May 31, 2014

Intangible Assets

Intangible Assets

9. Intangible Assets

The gross carrying amount and accumulated amortization of intangible assets are as follows:

		May 31,
		2014							2013
	Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount

Customer relationships	5-12	$	82,395	$	(34,636	)	$	47,759	$	69,901	$	(27,422	)	$	42,479
Software/Technology	3-15	15,328		(9,172		)	6,156		14,336		(7,629		)	6,707
Covenants not to compete	2-5	9,471		(7,882		)	1,589		8,069		(7,523		)	546
Other	2-5	5,869		(3,498		)	2,371		5,932		(3,236		)	2,696
Total		$	113,063	$	(55,188	)	$	57,875	$	98,238	$	(45,810	)	$	52,428

Amortization expense for the years ended May 31, 2014, 2013 and 2012 was approximately $9.2 million, $7.7 million and $5.6 million, respectively, including amortization of software/technology for the years ended May 31, 2014, 2013 and 2012 of $0.9 million, $0.6 million and $0.3 million, respectively.

Amortization expense in each of the five years and thereafter subsequent to May 31, 2014 related to the Company’s intangible assets is expected to be as follows:

	Expected Amortization Expense

2015	$	10,523
2016	9,085
2017	7,371
2018	5,913
2019	4,883
Thereafter	20,100
Total	$	57,875

Accrued Expenses and Other Current Liabilities

12 Months Ended

May 31, 2014

Accrued Expenses and Other Current Liabilities

Accrued Expenses and Other Current Liabilities

10. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following:

	May 31,
	2014		2013

Accrued salaries, wages and related employee benefits	$	26,236	$	23,662
Contingent consideration	4,778		5,144
Accrued worker compensation and health benefits	3,661		3,667
Deferred revenues	2,659		2,623
Other accrued expenses	17,316		12,743
Total accrued expenses and other liabilities	$	54,650	$	47,839

Long-Term Debt

12 Months Ended

May 31, 2014

Long-Term Debt

Long-Term Debt

11. Long-Term Debt

Long-term debt consists of the following:

	May 31,
	2014			2013

Senior credit facility	$	61,148		$	39,567
Notes payable	10,512			15,740
Other	4,988			4,960
Total debt	76,648			60,267
Less: Current maturities	(8,058		)	(7,418		)
Long-term debt, net of current maturities	$	68,590		$	52,849

Senior Credit Facility

In December 2011, the Company entered into a Third Amended and Restated Credit Agreement (Credit Agreement) with Bank of America, N.A., as agent for the lenders and a lender, and JPMorgan Chase Bank, N.A., Keybank National Association and TD Bank, N.A., as lenders. The Credit Agreement provides the Company with a $125.0 million revolving line of credit, which, under certain circumstances, can be increased to $150.0 million. The Credit Agreement has a maturity date of December 20, 2016. The Company may borrow up to $30.0 million in non-U.S. Dollar currencies and use up to $10.0 million of the credit limit for the issuance of letters of credit. As of May 31, 2014, the Company had borrowings of $61.1 million and a total of $3.5 million of letters of credit outstanding under the Credit Agreement.

Loans under the Credit Agreement bear interest at LIBOR plus an applicable LIBOR margin ranging from 1% to 2%, or a base rate less a margin of 0.25% to 1.25%, at the option of the Company, or based upon the Company’s Funded Debt Leverage Ratio. Funded Debt Leverage Ratio is generally the ratio of (1) all outstanding indebtedness for borrowed money and other interest-bearing indebtedness as of the date of determination to (2) EBITDA (which is (a) net income, less (b) income (or plus loss) from discontinued operations and extraordinary items, plus (c) income tax expenses, plus (d) interest expense, plus (e) depreciation, depletion, and amortization (including non-cash loss on retirement of assets), plus (f) stock compensation expense, less (g) cash expense related to stock compensation, plus or minus certain other adjustments) for the period of four consecutive fiscal quarters immediately preceding the date of determination. The Company has the benefit of the lowest margin if its Funded Debt Leverage Ratio is equal to or less than 0.5 to 1, and the margin increases as the ratio increases, to the maximum margin if the ratio is greater than 2.5 to 1. The Company will also bear additional costs for market disruption, regulatory changes effecting the lenders’ funding costs, and default pricing of an additional 2% interest rate margin if the Funded Debt Leverage Ratio exceeds 3.0 to 1. Amounts borrowed under the Credit Agreement are secured by liens on substantially all of the assets of the Company.

The Credit Agreement contains financial covenants requiring that the Company maintain a Funded Debt Leverage Ratio of less than 3.0 to 1 and an Interest Coverage Ratio of at least 3.0 to 1. Interest Coverage Ratio means the ratio, as of any date of determination, of (a) EBITDA for the 12 month period immediately preceding the date of determination, to (b) all interest, premium payments, debt discount, fees, charges and related expenses of the Company and its subsidiaries in connection with borrowed money (including capitalized interest) or in connection with the deferred purchase price of assets, in each case to the extent treated as interest in accordance with GAAP, paid during the 12 month period immediately preceding the date of determination. The Credit Agreement also limits the Company’s ability to, among other things, create liens, make investments, incur more indebtedness, merge or consolidate, make dispositions of property, pay dividends and make distributions to stockholders, enter into a new line of business, enter into transactions with affiliates and enter into burdensome agreements. The Credit Agreement does not limit the Company’s ability to acquire other businesses or companies except that the acquired business or company must be in its line of business, the Company must be in compliance with the financial covenants on a pro forma basis after taking into account the acquisition, and, if the acquired business is a separate subsidiary, in certain circumstances the lenders will receive the benefit of a guaranty of the subsidiary and liens on its assets and a pledge of its stock.

As of May 31, 2014, we were in compliance with the terms of the credit agreement, and we will continuously monitor our compliance with the covenants contained in our credit agreement.

Notes Payable and Other Debt

In connection with acquisitions through fiscal 2014, the Company issued subordinated notes payable to the sellers. The maturity of these notes range from three to five years from the date of acquisition with stated interest rates ranging from 0% to 4%. The Company has discounted these obligations to reflect a 2% to 4% market interest. Unamortized discount on the notes was de minimus as of May 31, 2014 and 2013, respectively. Amortization is recorded as interest expense in the consolidated statements of income.

Scheduled principal payments due under all borrowing agreements in each of the five years and thereafter subsequent to May 31, 2014 are as follows:

2015	$	8,058
2016	5,901
2017	62,182
2018	140
2019	335
Thereafter	32
Total	$	76,648

Fair Value Measurements

12 Months Ended

May 31, 2014

Fair Value Measurements

Fair Value Measurements

12. Fair Value Measurements

The Company performs fair value measurements in accordance with the guidance provided by ASC 820, Fair Value Measurements and Disclosures. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a three level hierarchy that prioritizes the inputs used to measure fair value. The three levels of the hierarchy are defined as follows:

Level 1 — Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

Level 2 — Observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability and inputs derived principally from or corroborated by observable market data.

Level 3 — Unobservable inputs reflecting the Company’s own assumptions about inputs that market participants would use in pricing the asset or liability based on the best information available.

In accordance with the fair value hierarchy described above, the following table shows the fair value of the Company’s financial liabilities that are required to be remeasured at fair value on a recurring basis:

	May 31, 2014
	Level 1		Level 2		Level 3		Total

Liabilities:
Contingent consideration	$	—	$	—	$	14,145	$	14,145
Total Liabilities	$	—	$	—	$	14,145	$	14,145

	May 31, 2013
	Level 1		Level 2		Level 3		Total

Liabilities:
Contingent consideration	$	—	$	—	$	15,438	$	15,438
Total Liabilities	$	—	$	—	$	15,438	$	15,438

The fair value of contingent consideration liabilities that was classified as Level 3 in the table above was estimated using a discounted cash flow technique with significant inputs that are not observable in the market and thus represents a Level 3 fair value measurement as defined in ASC 820. The significant inputs in the Level 3 measurement not supported by market activity include the probability assessments of expected future cash flows related to the acquisitions, appropriately discounted considering the uncertainties associated with the obligation, and as calculated in accordance with the terms of the acquisition agreements.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Share-Based Compensation

12 Months Ended

May 31, 2014

Share-Based Compensation

Share-Based Compensation

13. Share-Based Compensation

The Company has share-based incentive awards outstanding to our eligible employees and Directors under two employee stock ownership plans: (i) the 2007 Stock Option Plan (the 2007 Plan), and (ii) the 2009 Long-Term Incentive Plan (the 2009 Plan). No further awards may be granted under the 2007 Plan, although awards granted under the 2007 Plan remain outstanding in accordance with their terms. Awards granted under the 2009 Plan may be in the form of stock options, restricted stock units and other forms of share-based incentives, including performance restricted stock units, stock appreciation rights and deferred stock rights. The 2009 Plan allows for the grant of awards of up to approximately 2,286,000 shares of common stock, of which approximately 765,000 shares were available for future grants as of May 31, 2014. As of May 31, 2014, there was an aggregate of approximately 2,352,000 stock options outstanding and approximately 1,050,000 unvested restricted stock units outstanding under the 2009 Plan, the 2007 Plan, and the 1995 Plan.

Stock Options

For the fiscal years ended May 31, 2014, 2013 and 2012, the Company recognized share-based compensation expense related to stock option awards of approximately $0.7 million, $3.1 million and $3.2 million, respectively. As of May 31, 2014, there was less than $0.1 million of unrecognized compensation costs, net of estimated forfeitures, related to stock option awards, which are expected to be recognized over a remaining weighted average period of 1.8 years. Cash proceeds from, and the intrinsic value of, stock options exercised during the years ended May 31, 2014, 2013 and 2012 were as follows:

	For the year ended May 31,
	2014		2013		2012

Cash proceeds from options exercised	$	996	$	829	$	2,484
Aggregate intrinsic value of options exercised	1,247		1,012		4,439

A summary of the stock option activity, weighted average exercise prices, options outstanding and exercisable as of May 31, 2014 is as follows (in thousands, except per share amounts):

	For the year ended May 31,
	2014				2013				2012
	Common Stock Options		Weighted Average Exercise Price		Common Stock Options		Weighted Average Exercise Price		Common Stock Options		Weighted Average Exercise Price

Outstanding at beginning of year:	2,464		$	12.93	2,549		$	12.82	2,867		$	12.27
Granted	—		$	—	—		$	—	5		$	22.35
Exercised	(103	)	$	9.67	(85	)	$	9.66	(307	)	$	8.07
Expired or forfeited	(9	)	$	10.03	—		$	—	(16	)	$	7.69
Outstanding at end of year:	2,352		$	13.09	2,464		$	12.93	2,549		$	12.82

			For the year ended May 31, 2014
			Options Outstanding			Options Exercisable
Range of Exercise Prices	Total Options Outstanding		Weighted Average Remaining Life (Years)	Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price

$6.15-$13.08	257		4.4	$	9.87	257		$	9.87
$13.46-$22.35	2,095		5.2	$	13.48	2,092		$	13.47
	2,352					2,349

Aggregate Intrinsic Value	$	22,749				$	22,748

Restricted Stock Unit Awards

The Company recognized approximately $4.0 million, $2.9 million and $1.9 million in share-based compensation expense related to restricted stock unit awards during the fiscal years ended May 31, 2014, 2013 and 2012, respectively. As of May 31, 2014, there were approximately $8.6 million of unrecognized compensation costs, net of estimated forfeitures, related to restricted stock unit awards, which are expected to be recognized over a remaining weighted average period of 2.3 years.

During the years ended May 31, 2014 and 2013, the Company granted approximately 19,000 and 13,000 shares, respectively, of fully-vested common stock to its five non-employee directors, in connection with its non-employee director compensation plan. These shares had a grant date fair value of approximately $0.4 million and $0.3 million, respectively, which is included in the share-based compensation expense recorded during the years ended May 31, 2014 and 2013.

During the years ended May 31, 2014 and 2013, approximately 178,000 and 123,000 restricted stock units vested. The fair value of these units was $3.3 million and $1.9 million, respectively. Upon vesting, restricted stock units are generally net share-settled to cover the required withholding tax and the remaining amount is converted into an equivalent number of shares of common stock.

Performance Restricted Stock Units

In fiscal 2014, the company granted performance restricted stock units to its executive and certain other senior officers. These units have requisite service periods of three years and have no dividend rights. Compensation expense related to performance restricted stock units was $1.2 million for the year ended May 31, 2014. At May 31, 2014, there was $7.4 million of total unrecognized compensation costs related to approximately 423,000 nonvested performance restricted stock units. These costs are expected to be recognized over a weighted-average period of approximately 2.3 years. The actual payout of these units will vary based on the Company’s performance over the three-year period based on pre-established targets over the period and a market condition modifier based on total shareholder return compared to an industry peer group. The actual payout under these awards may exceed an executive’s target payout; however, compensation cost initially recognized assumes that the target payout level will be achieved and may be adjusted for subsequent changes in the expected outcome of the performance-related condition.

Income Taxes

12 Months Ended

May 31, 2014

Income Taxes

Income Taxes

14. Income Taxes

Income before provision for income taxes is as follows:

	For the year ended May 31,
	2014		2013			2012

Income before provision for income taxes from:
U.S. operations	$	25,433	$	29,573		$	27,951
Foreign operations	9,670		(5,307		)	5,686
Earnings before income taxes	$	35,103	$	24,266		$	33,637

The provision for income taxes consists of the following:

	For the year ended May 31,
	2014			2013			2012

Current
Federal	$	8,836		$	9,035		$	8,792
States and local	1,689			1,673			1,762
Foreign	2,484			3,118			2,042
Reserve for uncertain tax positions	59			206			47
Total current	13,068			14,032			12,643
Deferred
Federal	(53		)	5			216
States and local	395			134			105
Foreign	(967		)	246			(359		)
Total deferred	(625		)	385			(38		)
Net change in valuation allowance	85			(1,790		)	(314		)
Net deferred	(540		)	(1,405		)	(352		)
Provision for income taxes	$	12,528		$	12,627		$	12,291

The provision for income taxes differs from the amount computed by applying the statutory federal tax rate to income tax as follows:

	For the year ended May 31,
	2014					2013					2012

Federal tax at statutory rate	$	12,286		35.0	%	$	8,493		35.0	%	$	11,773		35.0	%
State taxes, net of federal benefit	1,355			3.9	%	1,174			4.8	%	1,213			3.6	%
Foreign tax	(1,868		)	(5.3	)%	1,744			7.2	%	(307		)	(0.9	)%
Contingent consideration	24			0.1	%	(1,156		)	(4.8	)%	(370		)	(1.1	)%
Permanent differences	531			1.5	%	498			2.1	%	272			0.8	%
Goodwill impairment	—			0.0	%	3,478			14.3	%	—			0.0	%
Other	115			0.3	%	186			0.8	%	24			0.0	%
Change in valuation allowance	85			0.2	%	(1,790		)	(7.4	)%	(314		)	(0.9	)%
Total provision for income taxes	$	12,528		35.7	%	$	12,627		52.0	%	$	12,291		36.5	%

Deferred income tax attributes resulting from differences between financial accounting amounts and income tax basis of assets and liabilities are as follows:

	May 31,
	2014			2013

Deferred income tax assets
Allowance for doubtful accounts	$	777		$	745
Inventory	726			637
Intangible assets	3,316			5,220
Accrued expenses	2,580			2,505
Net operating loss carryforward	3,745			3,314
Capital lease obligation	44			452
Deferred stock based compensation	5,739			4,690
Other	108			37
Deferred income tax assets	17,035			17,600
Valuation allowance	(2,553		)	(2,701		)
Net deferred income tax assets	14,482			14,899
Deferred income tax liabilities
Property and equipment	(6,821		)	(7,142		)
Goodwill	(9,423		)	(7,390		)
Intangible assets	(9,057		)	(9,277		)
Other	(80		)	(83		)
Deferred income tax liabilities	(25,381		)	(23,892		)
Net deferred income taxes	$	(10,899	)	$	(8,993	)

Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. Evidence used includes information about the Company’s current financial position and results of operations for the current and preceding years, as well as available information about future years, the reversal of deferred tax liabilities and tax planning strategies. On the basis of this evaluation, as of May 31, 2014, a valuation allowance of $2.6 million has been recorded to reduce the deferred tax assets to an amount that will more likely than not be realized.

As of May 31, 2014, the Company has available state net operating losses of approximately $0.4 million with expiration dates starting in fiscal 2026, and state net operating losses of $2.6 million with expiration dates starting in fiscal 2015. In addition, the company has net operating losses in certain foreign jurisdictions of approximately $11.0 million some of which have unlimited life and others expire beginning in fiscal 2019.

The following table summarizes the changes in the Company’s gross unrecognized tax benefits, excluding interest and penalties:

	For the year ended May 31,
	2014			2013			2012
Balance at June 1	$	1,061		$	971		$	375
Additions for tax positions related to the current fiscal year	36			31			24
Additions for tax positions related to prior years	—			93			44
Decreases for tax positions related to prior years	(10		)	—			(22		)
Current year acquisitions	63			—			561
Impact of foreign exchange fluctuation	(52		)	(24		)	—
Settlements	(48		)	(4		)	—
Reductions related to the expiration of statutes of limitations	(34		)	(6		)	(11		)
Balance at May 31	$	1,016		$	1,061		$	971

The Company has recorded the unrecognized tax benefits in other long-term liabilities in the consolidated balance sheets as of May 31, 2014, 2013 and 2012. As of May 31, 2014, 2013 and 2012, there were approximately $1.4 million, $1.4 million and $1.2 million of unrecognized tax benefits, respectively, including penalties and interest that if recognized would favorably affect the effective tax rate. Interest and penalties related to unrecognized tax benefits are recorded in income tax expense and are not significant for the years ending May 31, 2014, 2013 and 2012. The Company anticipates a decrease to its unrecognized tax benefits of approximately $0.1 million excluding interest and penalties within the next 12 months.

The Company is subject to taxation in the United States and various states and foreign jurisdictions. The Company is no longer subject to U.S. federal income tax examinations for years ending before May 31, 2012 and generally is no longer subject to state, local or foreign income tax examinations by tax authorities for years ending before May 31, 2010.

The Company has not recognized U.S. taxes on the earnings of its undistributed international subsidiaries since it intends to indefinitely reinvest the earnings outside the United States. Net income (loss) of foreign subsidiaries was $8.0 million and ($6.9) million for fiscal 2014 and 2013, respectively. We have recognized no deferred tax liability for the remittance of such earnings to the U.S. since it is our intention to utilize those earnings in the foreign operations. Determination of the amount of any unrecognized deferred income tax liability on this temporary difference is not practicable because of the complexities of the hypothetical calculation.

Employee Benefit Plans	12 Months Ended
Employee Benefit Plans	May 31, 2014
Employee Benefit Plans
Employee Benefit Plans	15. Employee Benefit Plans The Company provides a 401(k) savings plan for eligible U.S. based employees. Employee contributions are discretionary up to the IRS limits each year and catch up contributions are allowed for employees 50 years of age or older. Under the 401(k) plan, employees become eligible to participate on the first day of the month after six months of continuous service. Under this plan, the Company matches 50% of the employee’s contributions up to 6% of the employee’s annual compensation, as defined by the plan. There is a five-year vesting schedule for the Company match. The Company’s contribution to the plan was approximately $2.5 million, $2.3 million and $2.1 million for the years ended May 31, 2014, 2013 and 2012, respectively. The Company participates with other employers in contributing to a union plan, which covers certain U.S. based union employees. The plan is not administered by the Company and contributions are determined in accordance with provisions of a collective bargaining agreement. The Company’s contributions to the plan were less than $0.1 million in each of the years ended May 31, 2014, 2013 and 2012. The Company has benefit plans covering certain employees in selected foreign countries. Amounts charged to expense under these plans were not significant in any year.

Related Party Transactions	12 Months Ended
Related Party Transactions	May 31, 2014
Related Party Transactions
Related Party Transactions	16. Related Party Transactions The Company leases its headquarters under a capital lease from a shareholder and officer of the Company requiring monthly payments through October 2014. Total rent payments made during fiscal 2014 were approximately $0.9 million. See Note 17 — Obligations under Capital Leases for further detail related to capital leases. On August 1, 2014 the Company extended its lease at its headquarters requiring monthly payments through October 2024. The Company has a lease for office space located in France, which is partly owned by a shareholder and officer, requiring monthly payments through January 2016. Total rent payments made during fiscal 2014 were approximately $0.2 million. The Company has a lease for office space located in Brazil, which is partly owned by a shareholder and officer, requiring monthly payments through fiscal 2024. Total rent payments made during fiscal 2014 were approximately $0.1 million.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References + Details

Obligations under Capital Leases

12 Months Ended

May 31, 2014

Obligations under Capital Leases

Obligations under Capital Leases

17. Obligations under Capital Leases

The Company leases certain office space, including its headquarters, and service equipment under capital leases, requiring monthly payments ranging from less than $1 thousand to $72 thousand, including effective interest rates that range from approximately 3% to 9% expiring through May 2019. The net book value of assets under capital lease obligations was $18.1 million and $16.1 million at May 31, 2014 and 2013, respectively.

Scheduled future minimum lease payments subsequent to May 31, 2014 are as follows:

2015	$	8,246
2016	6,256
2017	4,161
2018	2,448
2019	994
Thereafter	122
Total minimum lease payments	22,227
Less: amount representing interest	(1,312		)
Present value of minimum lease payments	20,915
Less: current portion of obligations under capital leases	(7,251		)
Obligations under capital leases, net of current portion	$	13,664

Commitments and Contingencies

12 Months Ended

May 31, 2014

Commitments and Contingencies

Commitments and Contingencies

18. Commitments and Contingencies

Operating Leases

The Company is party to various noncancelable lease agreements, primarily for its international and domestic office and lab space. Future minimum lease payments under noncancelable operating leases in each of the five years and thereafter subsequent to May 31, 2014 are as follows:

2015	$	8,141
2016	6,317
2017	5,027
2018	3,689
2019	3,401
Thereafter	6,789
Total	$	33,364

Total rent expense was $9.5 million, $7.2 million and $5.4 million for the years ended May 31, 2014, 2013 and 2012, respectively.

Litigation

The Company is subject to periodic lawsuits, investigations and claims that arise in the ordinary course of business. Although the Company cannot predict with certainty the ultimate resolution of lawsuits, investigations and claims asserted against it, the Company does not believe that any currently pending legal proceeding to which the Company is a party will have a material adverse effect on its business, results of operations, cash flows or financial condition. The costs of defense and amounts that may be recovered in such matters may be covered by insurance.

In January 2012, the Company received notice of a governmental investigation concerning an environmental incident which occurred in February 2011 outside on the premises of its Cudahy, California location. No human injury or property damage was reported or appears to have been caused as a result of this incident, while management cannot predict the ultimate outcome of this matter, based on its internal investigation to date, the Company does not believe the outcome will have a material effect on its financial condition or results of operations.

During fiscal 2012 and 2013, the Company performed radiography work on the construction of pipeline projects in Georgia. The Company has received notice that the owner of the pipeline projects contends that certain of the x-ray images the Company’s technicians prepared regarding the project did not meet the code quality interpretation standards required by API (American Petroleum Institute) 1103. The projects owner is claiming damages as a result of the alleged quality defects of the Company’s x-ray images. No lawsuit has been filed at this time. The Company is currently unable to determine the likely outcome or reasonably estimate the amount or range of potential liability related to this matter, and accordingly, has not established any reserves for this matter.

The Company has also received a notice from an insurance company of a chemical plant alleging that the Company is liable due to faulty inspections for all or part of $46 million of damages paid by the insurance company as a result of an explosion at the facility. The Company believes it was not involved in inspecting the portion of the plant where the explosion occurred and therefore has no liability for the claim. Accordingly, the Company has not established a reserve for this matter.

Acquisition-related contingencies

The Company is liable for contingent consideration in connection with certain of its acquisitions. As of May 31, 2014, total potential acquisition-related contingent consideration ranged from zero to $27.9 million and would be payable upon the achievement of specific performance metrics by certain of the acquired companies over the next three years of operations. See Note 7 - Acquisitions for further discussion of the Company’s acquisitions.

Subsequent Events	12 Months Ended
Subsequent Events	May 31, 2014
Subsequent Events
Subsequent Events	19. Subsequent Events Subsequent to May 31, 2014, the Company completed an acquisition of an asset protection businesses located in Quebec, Canada. Subsequent to April 30, 2014, our International Segment completed an acquisition of an asset inspection business located in the United Kingdom. The Company’s cash outlay for these acquisitions was $3.9 million plus $0.5 million of notes payable. In addition to the cash consideration, the acquisition in Quebec provides for contingent consideration to be earned based upon the acquired company achieving specific performance metrics over the next three years of operation. The Company is in the process of completing the preliminary purchase price allocations. These acquisitions were not significant and no pro forma information has been included.

Segment Disclosure

12 Months Ended

May 31, 2014

Segment Disclosure

Segment Disclosure

20. Segment Disclosure

The Company’s three operating segments are:

· Services. This segment provides asset protection solutions predominantly in North America with the largest concentration in the United States along with a growing Canadian services business, consisting primarily of non-destructive testing, and inspection and engineering services that are used to evaluate the structural integrity and reliability of critical energy, industrial and public infrastructure.

· Products and Systems. This segment designs, manufactures, sells, installs and services the Company’s asset protection products and systems, including equipment and instrumentation, predominantly in the United States.

· International. This segment offers services, products and systems similar to those of the Company’s other segments to global markets, principally in Europe, the Middle East, Africa, Asia and South America, but not to customers in China and South Korea, which are served by the Products and Systems segment.

Costs incurred for general corporate services, including accounting, audit, legal, and certain other costs, that are provided to the segments are reported within Corporate and eliminations. Sales to the International segment from the Products and Systems segment and subsequent sales by the International segment of the same items are recorded and reflected in the operating performance of both segments. Additionally, engineering charges and royalty fees charged to the Services and International segments by the Products and Systems segment are reflected in the operating performance of each segment. All such intersegment transactions are eliminated in the Company’s consolidated financial reporting.

The accounting policies of the reportable segments are the same as those described in Note 2 — Summary of Significant Accounting Policies. Segment income from operations is determined based on internal performance measures used by the Chief Executive Officer, who is the chief operating decision maker, to assess the performance of each business in a given period and to make decisions as to resource allocations. In connection with that assessment, the Chief Executive Officer may exclude matters such as charges for share-based compensation and certain other acquisition-related charges and balances, technology and product development costs, certain gains and losses from dispositions, and litigation settlements or other charges. Certain general and administrative costs such as human resources, information technology and training are allocated to the segments. Segment income from operations also excludes interest and other financial charges and income taxes. Corporate and other assets are comprised principally of cash, deposits, property, plant and equipment, domestic deferred taxes, deferred charges and other assets. Corporate loss from operations consists of depreciation on the corporate office facilities and equipment, administrative charges related to corporate personnel and other charges that cannot be readily identified for allocation to a particular segment.

Selected financial information by segment for the periods shown was as follows:

	For the year ended May 31,
	2014			2013			2012
Revenues
Services	$	443,229		$	380,851		$	349,793
International	161,395			126,840			59,466
Products and Systems	33,544			33,301			40,083
Corporate and eliminations	(14,721		)	(11,710		)	(12,467		)
	$	623,447		$	529,282		$	436,875

	For the year ended May 31,
	2014			2013		2012
Gross profit
Services	$	114,182		$	98,907	$	94,413
International	44,893			32,319		19,106
Products and Systems	14,495			16,947		18,578
Corporate and eliminations	(627		)	198		(2,407		)
	$	172,943		$	148,371	$	129,690

	For the year ended May 31,
	2014			2013			2012
Income from operations
Services	$	43,221		$	40,325		$	39,932
International	10,238			(8,246		)	3,262
Products and Systems	2,552			7,286			8,271
Corporate and eliminations	(17,716		)	(11,811		)	(15,367		)
	$	38,295		$	27,554		$	36,098

Income (loss) from operations by operating segment includes intercompany transactions, which are eliminated in Corporate and eliminations.

	For the year ended May 31,
	2014		2013			2012
Depreciation and amortization
Services	$	17,794	$	18,296		$	17,763
International	8,065		6,200			2,342
Products and Systems	2,373		2,229			1,831
Corporate and eliminations	197		(78		)	88
	$	28,429	$	26,647		$	22,024

	May 31,
	2014		2013
Intangible assets, net
Services	$	22,440	$	14,527
International	26,898		27,520
Products and Systems	8,310		9,600
Corporate and eliminations	227		781
	$	57,875	$	52,428

	May 31,
	2014		2013
Total assets
Services	$	249,378	$	200,326
International	155,571		139,445
Products and Systems	38,041		37,948
Corporate and eliminations	982		278
	$	443,972	$	377,997

Revenue and long-lived assets by geographic area was as follows:

	For the year ended May 31,
	2014		2013		2012
Revenue
United States	$	403,001	$	347,423	$	336,081
Other Americas	55,120		55,379		40,337
Europe	143,931		106,416		42,820
Asia-Pacific	21,395		20,064		17,637
	$	623,447	$	529,282	$	436,875

	May 31,
	2014		2013
Long-lived assets
United States	$	141,447	$	122,727
Other Americas	33,515		28,148
Europe	90,194		85,171
Asia-Pacific	1,046		71
	$	266,202	$	236,117

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
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-Paragraph 33
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599

Reference 4: http://www.xbrl.org/2003/role/presentationRef
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-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599

Reference 6: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-Section 50
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 29
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599

+ Details

Selected Quarterly Financial Information (unaudited)

12 Months Ended

May 31, 2014

Selected Quarterly Financial Information (unaudited)

Selected Quarterly Financial Information (unaudited)

21. Selected Quarterly Financial Information (unaudited)

The following is a summary of the quarterly results of operations for the years ended May 31, 2014 and 2013:

Fiscal quarter ended	May 31, 2014		February 28, 2014		November 30, 2013		August 31, 2013		May 31, 2013			February 28, 2013		November 30, 2012		August 31, 2012

Revenues	$	179,127	$	151,727	$	156,755	$	135,838	$	144,505		$	133,661	$	137,729	$	113,387
Gross Profit	46,389		39,300		47,977		39,277		38,543			34,206		41,905		33,717
Income from operations	10,468		3,000		15,252		9,575		(881		)	4,982		15,747		7,706
Net income attributable to Mistras Group, Inc.	$	6,419	$	1,201	$	9,257	$	5,641	$	(4,549	)	$	2,751	$	9,163	$	4,281
Earnings per common share:
Basic	0.23		0.04		0.33		0.20		(0.16		)	0.10		0.33		0.15
Diluted	0.22		0.04		0.32		0.19		(0.16		)	0.11		0.32		0.15

Description of Business and Basis of Presentation (Policies)	12 Months Ended
	May 31, 2014
Description of Business and Basis of Presentation
Principles of Consolidation	*Principles of Consolidation* The accompanying consolidated financial statements include the accounts of Mistras Group, Inc. and its wholly and majority-owned subsidiaries. Where the Company’s ownership interest is less than 100%, the noncontrolling interests are reported in stockholders’ equity in the accompanying consolidated balance sheets. The noncontrolling interests in net income, net of tax, is classified separately in the accompanying consolidated statements of income. All significant intercompany accounts and transactions have been eliminated in consolidation. Mistras Group, Inc.’s and its subsidiaries’ fiscal years end on May 31 except for the subsidiaries in the International segment, which end on April 30. Accordingly, the Company’s International segment subsidiaries are consolidated on a one-month lag. Therefore, in the quarter and year of acquisition, results of acquired subsidiaries in the International segment are generally included in consolidated results for one less month than the actual number of months from the acquisition date to the end of the reporting period. Management does not believe that any events occurred during the one-month lag period that would have a material effect on the Company’s consolidated financial statements. Reference to a fiscal year means the fiscal year ended May 31.
Reclassifications	*Reclassifications* Certain amounts in prior periods have been reclassified to conform to the current year presentation. Such reclassifications did not have a material effect on the Company’s financial condition or results of operations as previously reported.

- Definition

Disclosure of accounting policy regarding (1) the principles it follows in consolidating or combining the separate financial statements, including the principles followed in determining the inclusion or exclusion of subsidiaries or other entities in the consolidated or combined financial statements and (2) its treatment of interests (for example, common stock, a partnership interest or other means of exerting influence) in other entities, for example consolidation or use of the equity or cost methods of accounting. The accounting policy may also address the accounting treatment for intercompany accounts and transactions, noncontrolling interest, and the income statement treatment in consolidation for issuances of stock by a subsidiary.

+ References + Details

Summary of Significant Accounting Policies (Policies)

12 Months Ended

May 31, 2014

Summary of Significant Accounting Policies

Revenue Recognition

Revenue Recognition

Services

Products and Systems

Use of Estimates

Use of Estimates

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Accounts Receivable

Accounts Receivable

Inventories

Inventories

Software Costs

Software Costs

Property, Plant and Equipment

Property, Plant and Equipment

Goodwill

Goodwill

Impairment of Long-lived Assets

Impairment of Long-lived Assets

Shipping and Handling Costs

Shipping and Handling Costs

Shipping and handling costs are included in cost of revenues.

Taxes Collected from Customers

Taxes Collected from Customers

Taxes collected from customers and remitted to governmental authorities are presented in the consolidated statements of income on a net basis.

Research and Engineering

Research and Engineering

Research and product development costs are expensed as incurred.

Advertising, Promotions and Marketing

Advertising, Promotions and Marketing

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Foreign Currency Translation

Foreign Currency Translation

Derivative Financial Instruments

Derivative Financial Instruments

Concentrations of Credit Risk

Concentrations of Credit Risk

Self-Insurance

Self-Insurance

Share-based Compensation

Share-based Compensation

Dividend yield	0.0	%
Expected volatility	37	%
Risk-free interest rate	1.1	%
Expected term (years)	6.25

Dividend yield	0.0	%
Expected volatility	38	%
Risk-free interest rate	0.7	%
Expected term (years)	2.6

Income Taxes

Income Taxes

Summary of Significant Accounting Policies (Tables)

12 Months Ended

May 31, 2014

Stock option awards | Employees

Share-based compensation

Schedule of assumptions used in valuing the awards granted

The following table presents the assumptions used in the Black-Scholes option-pricing model during fiscal 2012 for awards made to employees:

Dividend yield	0.0	%
Expected volatility	37	%
Risk-free interest rate	1.1	%
Expected term (years)	6.25

Performance restricted stock units | Executives and senior officers

Share-based compensation

Schedule of assumptions used in valuing the awards granted

The following table presents the assumptions used in a Monte Carlo simulation model to value the TSR components of the grants issued in fiscal 2014:

Dividend yield	0.0	%
Expected volatility	38	%
Risk-free interest rate	0.7	%
Expected term (years)	2.6

Earnings per Share (Tables)

12 Months Ended

May 31, 2014

Earnings per Share

Schedule of computations of basic and diluted earnings per share

	For the year ended May 31,
	2014		2013		2012
Basic earnings per share
Numerator:
Net income attributable to Mistras Group, Inc.	$	22,518	$	11,646	$	21,353
Denominator
Weighted average common shares outstanding	28,365		28,141		27,839
Basic earnings per share	$	0.79	$	0.41	$	0.77

Diluted earnings per share:
Numerator:
Net income attributable to Mistras Group, Inc.	$	22,518	$	11,646	$	21,353
Denominator
Weighted average common shares outstanding	28,365		28,141		27,839
Dilutive effect of stock options outstanding	775		804		737
Dilutive effect of restricted stock units outstanding	184		161		109
	29,324		29,106		28,685
Diluted earnings per share	$	0.77	$	0.40	$	0.74

Schedule of potential common shares that were excluded from the computation of diluted earnings per share

	For the year ended May 31,
	2014	2013	2012

Potential common stock attributable to stock options outstanding	5	5	5
Potential common stock attributable to performance awards outstanding	121	—	—
Total	126	5	5

Accounts Receivable, net (Tables)

12 Months Ended

May 31, 2014

Accounts Receivable, net

Schedule of accounts receivable

	May 31,
	2014			2013

Trade accounts receivable	$	140,120		$	110,438
Allowance for doubtful accounts	(2,296		)	(1,884		)
Accounts receivable, net	$	137,824		$	108,554

Inventories (Tables)

12 Months Ended

May 31, 2014

Inventories

Schedule of inventories

	May 31,
	2014		2013

Raw materials	$	3,663	$	3,332
Work in progress	2,069		2,310
Finished goods	3,462		4,355
Services-related consumable supplies	2,182		2,507
Inventory	$	11,376	$	12,504

Property, Plant and Equipment, net (Tables)

12 Months Ended

May 31, 2014

Property, Plant and Equipment, net

Schedule of Property, plant and equipment

	May 31,
	Useful Life	2014			2013
	(Years)
Land		$	1,938		$	1,943
Building and improvements	30-40	22,983			20,973
Office furniture and equipment	5-8	7,169			7,244
Machinery and equipment	5-7	144,798			119,862

		176,888			150,022
Accumulated depreciation and amortization		(99,077		)	(81,603		)
Property, plant and equipment, net		$	77,811		$	68,419

Acquisitions (Tables)

12 Months Ended

May 31, 2014

Acquisitions

Summary of estimated fair value of assets acquired and liabilities assumed at the date of acquisition

	2014			2013			2012

Number of entities	6			3			11

Cash paid	$	22,272		$	34,968		30,453
Subordinated notes issued	—			7,715			3,348
Contingent consideration	3,967			8,330			10,625

Consideration paid	$	26,239		$	51,013		44,426

Current net assets	3,133			761			(5,773	)
Debt and other long-term liabilities	(2,226		)	(4,540		)	(9,106	)
Property, plant and equipment	1,566			8,945			14,260
Deferred tax liability	(2,248		)	(7,654		)	(1,746	)
Intangibles	12,993			25,491			11,934
Goodwill	13,021			28,010			34,857
Net assets acquired	$	26,239		$	51,013		44,426

Schedule of acquisition-related expense, net

	For the years ended May 31,
	2014			2013			2012

Due dilgence, professional fees and other transaction costs	$	1,280		$	1,586		$	1,806
Adjustments to fair value of contingent consideration liabilities	$	(3,937	)	$	(3,727	)	$	174
Acquisition-related expense, net	$	(2,657	)	$	(2,141	)	$	1,980

Goodwill (Tables)

12 Months Ended

May 31, 2014

Goodwill

Schedule of changes in carrying amount of goodwill by segment

	Services			International			Products			Total

Balance at May 31, 2012	$	58,746		$	24,481		$	13,592		$	96,819
Goodwill acquired during the year	2,126			25,884			—			28,010
Adjustments to preliminary purchase price allocations	516			780			(395		)	901
Goodwill impairment	—			(9,938		)	—			(9,938		)
Foreign currency translation	(103		)	(419		)	—			(522		)
Balance at May 31, 2013	$	61,285		$	40,788		$	13,197		$	115,270
Goodwill acquired during the year	15,558			232			—			15,790
Adjustments to preliminary purchase price allocations	(2,769		)	440			—			(2,329		)
Foreign currency translation	(307		)	2,092			—			1,785
Balance at May 31, 2014	$	73,767		$	43,552		$	13,197		$	130,516

Intangible Assets (Tables)

12 Months Ended

May 31, 2014

Intangible Assets

Schedule of gross amount and accumulated amortization of intangible assets

		May 31,
		2014							2013
	Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount

Customer relationships	5-12	$	82,395	$	(34,636	)	$	47,759	$	69,901	$	(27,422	)	$	42,479
Software/Technology	3-15	15,328		(9,172		)	6,156		14,336		(7,629		)	6,707
Covenants not to compete	2-5	9,471		(7,882		)	1,589		8,069		(7,523		)	546
Other	2-5	5,869		(3,498		)	2,371		5,932		(3,236		)	2,696
Total		$	113,063	$	(55,188	)	$	57,875	$	98,238	$	(45,810	)	$	52,428

Schedule of expected amortization expense of intangible assets

Amortization expense in each of the five years and thereafter subsequent to May 31, 2014 related to the Company’s intangible assets is expected to be as follows:

	Expected Amortization Expense

2015	$	10,523
2016	9,085
2017	7,371
2018	5,913
2019	4,883
Thereafter	20,100
Total	$	57,875

Accrued Expenses and Other Current Liabilities (Tables)

12 Months Ended

May 31, 2014

Accrued Expenses and Other Current Liabilities

Schedule of accrued expenses and other current liabilities

	May 31,
	2014		2013

Accrued salaries, wages and related employee benefits	$	26,236	$	23,662
Contingent consideration	4,778		5,144
Accrued worker compensation and health benefits	3,661		3,667
Deferred revenues	2,659		2,623
Other accrued expenses	17,316		12,743
Total accrued expenses and other liabilities	$	54,650	$	47,839

Long-Term Debt (Tables)

12 Months Ended

May 31, 2014

Long-Term Debt

Schedule of long-term debt

	May 31,
	2014			2013

Senior credit facility	$	61,148		$	39,567
Notes payable	10,512			15,740
Other	4,988			4,960
Total debt	76,648			60,267
Less: Current maturities	(8,058		)	(7,418		)
Long-term debt, net of current maturities	$	68,590		$	52,849

Schedule of principal payments due under all borrowing agreements

Scheduled principal payments due under all borrowing agreements in each of the five years and thereafter subsequent to May 31, 2014 are as follows:

2015	$	8,058
2016	5,901
2017	62,182
2018	140
2019	335
Thereafter	32
Total	$	76,648

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6479336&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6584090&loc=d3e28878-108400

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21538-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
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-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
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-Section 45
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-URI http://asc.fasb.org/extlink&oid=6451184&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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-Section 50
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-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21521-112644

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 22
-Article 5

+ Details

Fair Value Measurements (Tables)

12 Months Ended

May 31, 2014

Fair Value Measurements

Schedule of fair value of the Company's financial liabilities that are required to be remeasured at fair value on a recurring basis

	May 31, 2014
	Level 1		Level 2		Level 3		Total

Liabilities:
Contingent consideration	$	—	$	—	$	14,145	$	14,145
Total Liabilities	$	—	$	—	$	14,145	$	14,145

	May 31, 2013
	Level 1		Level 2		Level 3		Total

Liabilities:
Contingent consideration	$	—	$	—	$	15,438	$	15,438
Total Liabilities	$	—	$	—	$	15,438	$	15,438

Share-Based Compensation (Tables)

12 Months Ended

May 31, 2014

Share-Based Compensation

Schedule of cash proceeds from, and the intrinsic value of, stock options exercised

	For the year ended May 31,
	2014		2013		2012

Cash proceeds from options exercised	$	996	$	829	$	2,484
Aggregate intrinsic value of options exercised	1,247		1,012		4,439

Summary of stock option activity, weighted average exercise prices, options outstanding and exercisable

A summary of the stock option activity, weighted average exercise prices, options outstanding and exercisable as of May 31, 2014 is as follows (in thousands, except per share amounts):

	For the year ended May 31,
	2014				2013				2012
	Common Stock Options		Weighted Average Exercise Price		Common Stock Options		Weighted Average Exercise Price		Common Stock Options		Weighted Average Exercise Price

Outstanding at beginning of year:	2,464		$	12.93	2,549		$	12.82	2,867		$	12.27
Granted	—		$	—	—		$	—	5		$	22.35
Exercised	(103	)	$	9.67	(85	)	$	9.66	(307	)	$	8.07
Expired or forfeited	(9	)	$	10.03	—		$	—	(16	)	$	7.69
Outstanding at end of year:	2,352		$	13.09	2,464		$	12.93	2,549		$	12.82

Schedule of information concerning outstanding and exercisable options

			For the year ended May 31, 2014
			Options Outstanding			Options Exercisable
Range of Exercise Prices	Total Options Outstanding		Weighted Average Remaining Life (Years)	Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price

$6.15-$13.08	257		4.4	$	9.87	257		$	9.87
$13.46-$22.35	2,095		5.2	$	13.48	2,092		$	13.47
	2,352					2,349

Aggregate Intrinsic Value	$	22,749				$	22,748

Income Taxes (Tables)

12 Months Ended

May 31, 2014

Income Taxes

Schedule of income before provision for income taxes

	For the year ended May 31,
	2014		2013			2012

Income before provision for income taxes from:
U.S. operations	$	25,433	$	29,573		$	27,951
Foreign operations	9,670		(5,307		)	5,686
Earnings before income taxes	$	35,103	$	24,266		$	33,637

Schedule of provision for income taxes

	For the year ended May 31,
	2014			2013			2012

Current
Federal	$	8,836		$	9,035		$	8,792
States and local	1,689			1,673			1,762
Foreign	2,484			3,118			2,042
Reserve for uncertain tax positions	59			206			47
Total current	13,068			14,032			12,643
Deferred
Federal	(53		)	5			216
States and local	395			134			105
Foreign	(967		)	246			(359		)
Total deferred	(625		)	385			(38		)
Net change in valuation allowance	85			(1,790		)	(314		)
Net deferred	(540		)	(1,405		)	(352		)
Provision for income taxes	$	12,528		$	12,627		$	12,291

Schedule of provision for income taxes computed by applying the statutory federal tax rate

	For the year ended May 31,
	2014					2013					2012

Federal tax at statutory rate	$	12,286		35.0	%	$	8,493		35.0	%	$	11,773		35.0	%
State taxes, net of federal benefit	1,355			3.9	%	1,174			4.8	%	1,213			3.6	%
Foreign tax	(1,868		)	(5.3	)%	1,744			7.2	%	(307		)	(0.9	)%
Contingent consideration	24			0.1	%	(1,156		)	(4.8	)%	(370		)	(1.1	)%
Permanent differences	531			1.5	%	498			2.1	%	272			0.8	%
Goodwill impairment	—			0.0	%	3,478			14.3	%	—			0.0	%
Other	115			0.3	%	186			0.8	%	24			0.0	%
Change in valuation allowance	85			0.2	%	(1,790		)	(7.4	)%	(314		)	(0.9	)%
Total provision for income taxes	$	12,528		35.7	%	$	12,627		52.0	%	$	12,291		36.5	%

Schedule of deferred income tax assets and liabilities

	May 31,
	2014			2013

Deferred income tax assets
Allowance for doubtful accounts	$	777		$	745
Inventory	726			637
Intangible assets	3,316			5,220
Accrued expenses	2,580			2,505
Net operating loss carryforward	3,745			3,314
Capital lease obligation	44			452
Deferred stock based compensation	5,739			4,690
Other	108			37
Deferred income tax assets	17,035			17,600
Valuation allowance	(2,553		)	(2,701		)
Net deferred income tax assets	14,482			14,899
Deferred income tax liabilities
Property and equipment	(6,821		)	(7,142		)
Goodwill	(9,423		)	(7,390		)
Intangible assets	(9,057		)	(9,277		)
Other	(80		)	(83		)
Deferred income tax liabilities	(25,381		)	(23,892		)
Net deferred income taxes	$	(10,899	)	$	(8,993	)

Summary of changes in Company's gross unrecognized tax benefits, excluding interest and penalties

	For the year ended May 31,
	2014			2013			2012
Balance at June 1	$	1,061		$	971		$	375
Additions for tax positions related to the current fiscal year	36			31			24
Additions for tax positions related to prior years	—			93			44
Decreases for tax positions related to prior years	(10		)	—			(22		)
Current year acquisitions	63			—			561
Impact of foreign exchange fluctuation	(52		)	(24		)	—
Settlements	(48		)	(4		)	—
Reductions related to the expiration of statutes of limitations	(34		)	(6		)	(11		)
Balance at May 31	$	1,016		$	1,061		$	971

Obligations under Capital Leases (Tables)

12 Months Ended

May 31, 2014

Obligations under Capital Leases

Scheduled future minimum lease payments

Scheduled future minimum lease payments subsequent to May 31, 2014 are as follows:

2015	$	8,246
2016	6,256
2017	4,161
2018	2,448
2019	994
Thereafter	122
Total minimum lease payments	22,227
Less: amount representing interest	(1,312		)
Present value of minimum lease payments	20,915
Less: current portion of obligations under capital leases	(7,251		)
Obligations under capital leases, net of current portion	$	13,664

Commitments and Contingencies (Tables)

12 Months Ended

May 31, 2014

Commitments and Contingencies

Schedule of future minimum lease payments under noncancelable operating leases

Future minimum lease payments under noncancelable operating leases in each of the five years and thereafter subsequent to May 31, 2014 are as follows:

2015	$	8,141
2016	6,317
2017	5,027
2018	3,689
2019	3,401
Thereafter	6,789
Total	$	33,364

Segment Disclosure (Tables)

12 Months Ended

May 31, 2014

Segment Disclosure

Schedule of financial information by segment

	For the year ended May 31,
	2014			2013			2012
Revenues
Services	$	443,229		$	380,851		$	349,793
International	161,395			126,840			59,466
Products and Systems	33,544			33,301			40,083
Corporate and eliminations	(14,721		)	(11,710		)	(12,467		)
	$	623,447		$	529,282		$	436,875

	For the year ended May 31,
	2014			2013		2012
Gross profit
Services	$	114,182		$	98,907	$	94,413
International	44,893			32,319		19,106
Products and Systems	14,495			16,947		18,578
Corporate and eliminations	(627		)	198		(2,407		)
	$	172,943		$	148,371	$	129,690

	For the year ended May 31,
	2014			2013			2012
Income from operations
Services	$	43,221		$	40,325		$	39,932
International	10,238			(8,246		)	3,262
Products and Systems	2,552			7,286			8,271
Corporate and eliminations	(17,716		)	(11,811		)	(15,367		)
	$	38,295		$	27,554		$	36,098

	For the year ended May 31,
	2014		2013			2012
Depreciation and amortization
Services	$	17,794	$	18,296		$	17,763
International	8,065		6,200			2,342
Products and Systems	2,373		2,229			1,831
Corporate and eliminations	197		(78		)	88
	$	28,429	$	26,647		$	22,024

	May 31,
	2014		2013
Intangible assets, net
Services	$	22,440	$	14,527
International	26,898		27,520
Products and Systems	8,310		9,600
Corporate and eliminations	227		781
	$	57,875	$	52,428

	May 31,
	2014		2013
Total assets
Services	$	249,378	$	200,326
International	155,571		139,445
Products and Systems	38,041		37,948
Corporate and eliminations	982		278
	$	443,972	$	377,997

Schedule of revenue and long-lived assets by geographic area

	For the year ended May 31,
	2014		2013		2012
Revenue
United States	$	403,001	$	347,423	$	336,081
Other Americas	55,120		55,379		40,337
Europe	143,931		106,416		42,820
Asia-Pacific	21,395		20,064		17,637
	$	623,447	$	529,282	$	436,875

	May 31,
	2014		2013
Long-lived assets
United States	$	141,447	$	122,727
Other Americas	33,515		28,148
Europe	90,194		85,171
Asia-Pacific	1,046		71
	$	266,202	$	236,117

Selected Quarterly Financial Information (unaudited) (Tables)

12 Months Ended

May 31, 2014

Selected Quarterly Financial Information (unaudited)

Summary of the quarterly results of operations

Fiscal quarter ended	May 31, 2014		February 28, 2014		November 30, 2013		August 31, 2013		May 31, 2013			February 28, 2013		November 30, 2012		August 31, 2012

Revenues	$	179,127	$	151,727	$	156,755	$	135,838	$	144,505		$	133,661	$	137,729	$	113,387
Gross Profit	46,389		39,300		47,977		39,277		38,543			34,206		41,905		33,717
Income from operations	10,468		3,000		15,252		9,575		(881		)	4,982		15,747		7,706
Net income attributable to Mistras Group, Inc.	$	6,419	$	1,201	$	9,257	$	5,641	$	(4,549	)	$	2,751	$	9,163	$	4,281
Earnings per common share:
Basic	0.23		0.04		0.33		0.20		(0.16		)	0.10		0.33		0.15
Diluted	0.22		0.04		0.32		0.19		(0.16		)	0.11		0.32		0.15

Description of Business and Basis of Presentation (Details)	12 Months Ended
	May 31, 2014 item
Principles of Consolidation
Difference of period between the consolidation of International segment subsidiaries	1 month
Number of months less than the actual number of months from the acquisition date for which results of international segment subsidiaries are included in consolidation	1

Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions	12 Months Ended
	May 31, 2014	May 31, 2013	May 31, 2012
Advertising, Promotions and Marketing
Advertising expense	$ 1.8	$ 1.7	$ 1.1
Foreign Currency Translation
Foreign currency transaction (gains) losses	0.1	0.1	$ (0.5)
Derivative Financial Instruments
Outstanding interest rate swap contracts	$ 0.0	$ 0.0
Software/Technology
Software Costs
Estimated useful Life	3 years

Summary of Significant Accounting Policies (Details 2) - USD ($) $ in Thousands	12 Months Ended
	May 31, 2013	May 31, 2014	May 31, 2012
Goodwill
Carrying value of goodwill	$ 115,270	$ 130,516	$ 96,819
Goodwill impairment	9,938
Brazil
Goodwill
Goodwill impairment	9,900
International
Goodwill
Carrying value of goodwill	40,788	$ 43,552	$ 24,481
Goodwill impairment	$ 9,938

Summary of Significant Accounting Policies (Details 3) $ in Millions	12 Months Ended
	May 31, 2014 USD ($) item	May 31, 2013	May 31, 2012
Self-Insurance
Minimum Amount of workers compensation and health benefit claims for which third-party excess insurance coverage maintained \| $	$ 0.3
Customer concentration risk
Concentration of Credit Risk
Number of customers \| item	1
Revenues \| Customer concentration risk \| BP
Concentration of Credit Risk
Percentage of concentration risk		11.00%	16.00%
Accounts receivable, net \| Customer concentration risk \| BP
Concentration of Credit Risk
Percentage of concentration risk		9.00%

Summary of Significant Accounting Policies (Details 4) - shares	12 Months Ended
	May 31, 2014	May 31, 2013	May 31, 2012
Share-based compensation
Stock options granted (in shares)	0	0
Stock option awards
Share-based compensation
Stock options granted (in shares)			5,000
Stock option awards \| Employees
Assumptions used in valuing awards granted
Dividend yield (as a percent)			0.00%
Expected volatility (as a percent)			37.00%
Risk-free interest rate (as a percent)			1.10%
Expected term			6 years 3 months
Performance restricted stock units
Assumptions used in valuing awards granted
Requisite service period	3 years
Performance restricted stock units \| Executives and senior officers
Share-based compensation
Performance condition accounts to grant awards (as a percent)	75.00%
Market condition accounts to grant award (as a percent)	25.00%
Assumptions used in valuing awards granted
Dividend yield (as a percent)	0.00%
Expected volatility (as a percent)	38.00%
Risk-free interest rate (as a percent)	0.70%
Expected term	2 years 7 months 6 days
Requisite service period	3 years

Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	May 31, 2014	Feb. 28, 2014	Nov. 30, 2013	Aug. 31, 2013	May 31, 2013	Feb. 28, 2013	Nov. 30, 2012	Aug. 31, 2012	May 31, 2014	May 31, 2013	May 31, 2012
Basic earnings per share
Net income attributable to Mistras Group, Inc.	$ 6,419	$ 1,201	$ 9,257	$ 5,641	$ (4,549)	$ 2,751	$ 9,163	$ 4,281	$ 22,518	$ 11,646	$ 21,353
Denominator:
Weighted average common shares outstanding									28,365	28,141	27,839
Basic earnings per share (in dollars per share)	$ 0.23	$ 0.04	$ 0.33	$ 0.20	$ (0.16)	$ 0.10	$ 0.33	$ 0.15	$ 0.79	$ 0.41	$ 0.77
Denominator:
Weighted average common shares outstanding									28,365	28,141	27,839
Dilutive effect of stock options outstanding (in shares)									775	804	737
Dilutive effect of restricted stock units outstanding (in shares)									184	161	109
Weighted average common shares outstanding, diluted									29,324	29,106	28,685
Diluted earnings per share (in dollars per share)	$ 0.22	$ 0.04	$ 0.32	$ 0.19	$ (0.16)	$ 0.11	$ 0.32	$ 0.15	$ 0.77	$ 0.40	$ 0.74
Earnings per share
Total shares									126	5	5
Potential common stock attributable to stock options outstanding
Earnings per share
Total shares									5	5	5
Potential common stock attributable to performance awards outstanding
Earnings per share
Total shares									121

Accounts Receivable, net (Details) - USD ($) $ in Thousands	May 31, 2014	May 31, 2013
Accounts Receivable, net
Trade accounts receivable	$ 140,120	$ 110,438
Allowance for doubtful accounts	(2,296)	(1,884)
Accounts receivable, net	137,824	108,554
Accrued unbilled revenues	$ 16,900	$ 8,100

Inventories (Details) - USD ($) $ in Thousands	May 31, 2014	May 31, 2013
Inventories
Raw materials	$ 3,663	$ 3,332
Work in progress	2,069	2,310
Finished goods	3,462	4,355
Services-related consumable supplies	2,182	2,507
Inventory	$ 11,376	$ 12,504

Property, Plant and Equipment, net (Details) - USD ($) $ in Thousands	12 Months Ended
	May 31, 2014	May 31, 2013	May 31, 2012
Property, Plant and Equipment, net
Property, plant and equipment, gross	$ 176,888	$ 150,022
Accumulated depreciation and amortization	(99,077)	(81,603)
Property, plant and equipment, net	77,811	68,419
Depreciation expense	19,200	18,900	$ 16,400
Land
Property, Plant and Equipment, net
Property, plant and equipment, gross	1,938	1,943
Buildings and improvements
Property, Plant and Equipment, net
Property, plant and equipment, gross	$ 22,983	20,973
Buildings and improvements \| Minimum
Property, Plant and Equipment, net
Useful Life	30 years
Buildings and improvements \| Maximum
Property, Plant and Equipment, net
Useful Life	40 years
Office furniture and equipment
Property, Plant and Equipment, net
Property, plant and equipment, gross	$ 7,169	7,244
Office furniture and equipment \| Minimum
Property, Plant and Equipment, net
Useful Life	5 years
Office furniture and equipment \| Maximum
Property, Plant and Equipment, net
Useful Life	8 years
Machinery and equipment
Property, Plant and Equipment, net
Property, plant and equipment, gross	$ 144,798	$ 119,862
Machinery and equipment \| Minimum
Property, Plant and Equipment, net
Useful Life	5 years
Machinery and equipment \| Maximum
Property, Plant and Equipment, net
Useful Life	7 years

Acquisitions (Details) $ in Thousands	12 Months Ended
Acquisitions (Details) $ in Thousands	May 31, 2014 USD ($) item	May 31, 2013 USD ($) item	May 31, 2012 USD ($) item
Acquisitions
Percentage of common stock acquired		100.00%
Period over which potential acquisition-related contingent consideration would be payable	3 years	5 years
Consideration transferred:
Goodwill	$ 15,790	$ 28,010
Acquisition-related expense, net
Adjustment to fair value of contingent consideration liabilities	(3,937)	(3,727)	$ 174
Acquisition-related expense, net	(2,657)	(2,141)	$ 1,980
Services
Consideration transferred:
Goodwill	15,558	2,126
International
Consideration transferred:
Goodwill	$ 232	$ 25,884
Fiscal 2014 acquisitions
Acquisitions
Percentage of common stock acquired	100.00%
Period over which potential acquisition-related contingent consideration would be payable	3 years
Potential acquisition-related contingent consideration, low end of range	$ 0
Potential acquisition-related contingent consideration, high end of range	$ 6,200
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item	6
Consideration transferred:
Cash paid	$ 22,272
Contingent consideration	3,967
Consideration paid	26,239
Current net assets	3,133
Debt and other long-term liabilities	(2,226)
Property, plant and equipment	1,566
Deferred tax liability	(2,248)
Intangibles	12,993
Goodwill	13,021
Net assets acquired	26,239
Acquisition-related expense, net
Due diligence, professional fees and other transaction costs	1,280
Adjustment to fair value of contingent consideration liabilities	(3,937)
Acquisition-related expense, net	$ (2,657)
Fiscal 2014 acquisitions \| Services
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item	5
Fiscal 2014 acquisitions \| Minimum
Consideration transferred:
Amortization period of intangible assets acquired	2 years
Fiscal 2014 acquisitions \| Maximum
Consideration transferred:
Amortization period of intangible assets acquired	12 years
Fiscal 2013 acquisitions
Acquisitions
Percentage of common stock acquired		100.00%
Term over which the subordinated notes are payable		3 years
Period over which potential acquisition-related contingent consideration would be payable		5 years
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item		3
Consideration transferred:
Cash paid		$ 34,968
Subordinated notes issued		7,715
Contingent consideration		8,330
Consideration paid		51,013
Current net assets		761
Debt and other long-term liabilities		(4,540)
Property, plant and equipment		8,945
Deferred tax liability		(7,654)
Intangibles		25,491
Goodwill		28,010
Net assets acquired		51,013
Revenue and income from operations included in the consolidated statement of operations
Revenues	$ 16,300
Aggregate income from operations	$ 1,200
Acquisition-related expense, net
Due diligence, professional fees and other transaction costs		1,586
Adjustment to fair value of contingent consideration liabilities		(3,727)
Acquisition-related expense, net		$ (2,141)
Fiscal 2013 acquisitions \| International
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item		2
Fiscal 2012 acquisitions
Acquisitions
Period over which potential acquisition-related contingent consideration would be payable			4 years
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item			11
Consideration transferred:
Fair value of contingent consideration			$ 8,500
Cash paid			30,453
Subordinated notes issued			3,348
Contingent consideration			10,625
Consideration paid			44,426
Current net assets			(5,773)
Debt and other long-term liabilities			(9,106)
Property, plant and equipment			14,260
Deferred tax liability			(1,746)
Intangibles			11,934
Goodwill			34,857
Net assets acquired			44,426
Acquisition-related expense, net
Due diligence, professional fees and other transaction costs			1,806
Adjustment to fair value of contingent consideration liabilities			174
Acquisition-related expense, net			$ 1,980
Fiscal 2012 acquisitions \| Services
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item			3
Fiscal 2012 acquisitions \| International
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item			7
Fiscal 2012 acquisitions \| Products and Systems
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item			1
Two of the entities acquired In fiscal 2014 acquisitions
Acquisitions
Maximum fair value measurement period from the acquisition date	1 year
Estimated fair value of the assets acquired and liabilities assumed
Number of entities \| item	2
Consideration transferred:
Intangibles	$ 2,200
Goodwill	$ 800

Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
Goodwill (Details) - USD ($) $ in Thousands	May 31, 2014	May 31, 2013
Changes in the carrying amount of goodwill
Balance at the beginning of the period	$ 115,270	$ 96,819
Goodwill acquired during the year	15,790	28,010
Adjustments to preliminary purchase price allocations	(2,329)	901
Goodwill impairment		(9,938)
Foreign currency translation	1,785	(522)
Balance at the end of the period	130,516	115,270
Brazil
Changes in the carrying amount of goodwill
Goodwill impairment		(9,900)
Services
Changes in the carrying amount of goodwill
Balance at the beginning of the period	61,285	58,746
Goodwill acquired during the year	15,558	2,126
Adjustments to preliminary purchase price allocations	(2,769)	516
Foreign currency translation	(307)	(103)
Balance at the end of the period	73,767	61,285
International
Changes in the carrying amount of goodwill
Balance at the beginning of the period	40,788	24,481
Goodwill acquired during the year	232	25,884
Adjustments to preliminary purchase price allocations	440	780
Goodwill impairment		(9,938)
Foreign currency translation	2,092	(419)
Balance at the end of the period	43,552	40,788
Products
Changes in the carrying amount of goodwill
Balance at the beginning of the period	13,197	13,592
Adjustments to preliminary purchase price allocations		(395)
Balance at the end of the period	$ 13,197	$ 13,197

Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
Intangible Assets (Details) - USD ($) $ in Thousands	May 31, 2014	May 31, 2013	May 31, 2012
Intangible assets
Gross Amount	$ 113,063	$ 98,238
Accumulated Amortization	(55,188)	(45,810)
Net Carrying	57,875	52,428
Amortization expense	9,200	7,700	$ 5,600
Expected Amortization Expense
2015	10,523
2016	9,085
2017	7,371
2018	5,913
2019	4,883
Thereafter	20,100
Total	57,875
Customer relationships
Intangible assets
Gross Amount	82,395	69,901
Accumulated Amortization	(34,636)	(27,422)
Net Carrying	$ 47,759	42,479
Customer relationships \| Minimum
Intangible assets
Useful Life	5 years
Customer relationships \| Maximum
Intangible assets
Useful Life	12 years
Software/Technology
Intangible assets
Useful Life	3 years
Gross Amount	$ 15,328	14,336
Accumulated Amortization	(9,172)	(7,629)
Net Carrying	6,156	6,707
Amortization expense	$ 900	600	$ 300
Software/Technology \| Minimum
Intangible assets
Useful Life	3 years
Software/Technology \| Maximum
Intangible assets
Useful Life	15 years
Covenants not to compete
Intangible assets
Gross Amount	$ 9,471	8,069
Accumulated Amortization	(7,882)	(7,523)
Net Carrying	$ 1,589	546
Covenants not to compete \| Minimum
Intangible assets
Useful Life	2 years
Covenants not to compete \| Maximum
Intangible assets
Useful Life	5 years
Other
Intangible assets
Gross Amount	$ 5,869	5,932
Accumulated Amortization	(3,498)	(3,236)
Net Carrying	$ 2,371	$ 2,696
Other \| Minimum
Intangible assets
Useful Life	2 years
Other \| Maximum
Intangible assets
Useful Life	5 years

Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	May 31, 2014	May 31, 2013
Accrued Expenses and Other Current Liabilities
Accrued salaries, wages and related employee benefits	$ 26,236	$ 23,662
Contingent consideration	4,778	5,144
Accrued worker compensation and health benefits	3,661	3,667
Deferred revenues	2,659	2,623
Other accrued expenses	17,316	12,743
Total accrued expenses and other liabilities	$ 54,650	$ 47,839

Long-Term Debt (Details) $ in Thousands	12 Months Ended
Long-Term Debt (Details) $ in Thousands	May 31, 2014 USD ($) item	May 31, 2013 USD ($)
Long-Term Debt
Long-term debt	$ 76,648	$ 60,267
Less: Current portion	(8,058)	(7,418)
Long-term debt, net of current portion	68,590	52,849
Principal payments due under all borrowing agreements
2015	8,058
2016	5,901
2017	62,182
2018	140
2019	335
Thereafter	32
Total	76,648	60,267
Senior credit facility
Long-Term Debt
Long-term debt	61,148	39,567
Current borrowing capacity	125,000
Maximum borrowing capacity	150,000
Maximum borrowing capacity in non-U.S. Dollar currencies	30,000
Maximum amount available for the issuance of letters of credit	10,000
Outstanding borrowings	61,100
Outstanding letters of credit	$ 3,500
Number of consecutive fiscal quarters used for calculating Funded Debt Leverage Ratio \| item	4
Additional interest rate margin if Funded Debt Leverage Ratio exceeds threshold (as a percent)	2.00%
Preceding period used for calculating Interest Coverage Ratio	12 months
Principal payments due under all borrowing agreements
Total	$ 61,148	39,567
Senior credit facility \| Minimum
Long-Term Debt
Funded Debt Leverage Ratio at which the entity will bear the maximum interest rate margin	2.5
Funded Debt Leverage Ratio for additional interest payment	3.0
Interest Coverage Ratio	3.0
Senior credit facility \| Maximum
Long-Term Debt
Funded Debt Leverage Ratio at which the entity will have the benefit of lowest interest margin	0.5
Funded Debt Leverage Ratio	3.0
Senior credit facility \| LIBOR
Long-Term Debt
Reference rate, description	LIBOR
Senior credit facility \| LIBOR \| Minimum
Long-Term Debt
Margin (as a percent)	1.00%
Senior credit facility \| LIBOR \| Maximum
Long-Term Debt
Margin (as a percent)	2.00%
Senior credit facility \| Base rate
Long-Term Debt
Reference rate, description	base rate
Senior credit facility \| Base rate \| Minimum
Long-Term Debt
Margin (as a percent)	(0.25%)
Senior credit facility \| Base rate \| Maximum
Long-Term Debt
Margin (as a percent)	(1.25%)
Notes payable
Long-Term Debt
Long-term debt	$ 10,512	15,740
Interest rate, minimum (as a percent)	0.00%
Interest rate, maximum (as a percent)	4.00%
Principal payments due under all borrowing agreements
Total	$ 10,512	15,740
Notes payable \| Minimum
Long-Term Debt
Maturity term from the date of acquisition	3 years
Market interest rate (as a percent)	2.00%
Notes payable \| Maximum
Long-Term Debt
Maturity term from the date of acquisition	5 years
Market interest rate (as a percent)	4.00%
Other
Long-Term Debt
Long-term debt	$ 4,988	4,960
Principal payments due under all borrowing agreements
Total	$ 4,988	$ 4,960

Fair Value Measurements (Details) - Recurring basis - USD ($) $ in Thousands	May 31, 2014	May 31, 2013
Level 3
Liabilities:
Contingent consideration	$ 14,145	$ 15,438
Total Liabilities	14,145	15,438
Total
Liabilities:
Contingent consideration	14,145	15,438
Total Liabilities	$ 14,145	$ 15,438

Share-Based Compensation (Details) $ in Thousands	12 Months Ended
Share-Based Compensation (Details) $ in Thousands	May 31, 2014 USD ($) item shares	May 31, 2013 USD ($) shares	May 31, 2012 USD ($) shares	May 31, 2011 shares
Share-based compensation
Number of employee stock ownership plans \| item	2
Stock option awards
Share-based compensation
Stock options outstanding (in shares) \| shares	2,352,000	2,464,000	2,549,000	2,867,000
Recognized share-based compensation expense \| $	$ 700	$ 3,100	$ 3,200
Weighted-average period over which unrecognized compensation cost is expected to be recognized	1 year 9 months 18 days
Additional disclosures
Cash proceeds from options exercised \| $	$ 996	829	2,484
Aggregate intrinsic value of options exercised \| $	1,247	1,012	4,439
Stock option awards \| Maximum
Share-based compensation
Unrecognized compensation costs, net of estimated forfeitures, related to stock option awards \| $	$ 100
Restricted stock unit awards
Share-based compensation
Unvested restricted stock units outstanding (in shares) \| shares	1,050,000
Recognized share-based compensation expense \| $	$ 4,000	$ 2,900	$ 1,900
Weighted-average period over which unrecognized compensation cost is expected to be recognized	2 years 3 months 18 days
2007 Plan
Share-based compensation
Number of awards that may be granted (in shares) \| shares	0
2009 Plan
Share-based compensation
Number of shares authorized for grants \| shares	2,286,000
Number of awards that may be granted (in shares) \| shares	765,000

Share-Based Compensation (Details 2) - $ / shares	12 Months Ended
Share-Based Compensation (Details 2) - $ / shares	May 31, 2014	May 31, 2013	May 31, 2012
Common Stock Options
Granted (in shares)	0	0
Stock option awards
Common Stock Options
Outstanding at beginning of year (in shares)	2,464,000	2,549,000	2,867,000
Granted (in shares)			5,000
Exercised (in shares)	(103,000)	(85,000)	(307,000)
Expired or forfeited (in shares)	(9,000)		(16,000)
Outstanding at end of year (in shares)	2,352,000	2,464,000	2,549,000
Weighted Average Exercise Price (in dollar per share)
Outstanding at beginning of year (in dollars per share)	$ 12.93	$ 12.82	$ 12.27
Granted (in dollars per share)			22.35
Exercised (in dollars per share)	9.67	9.66	8.07
Expired or forfeited (in dollars per share)	10.03		7.69
Outstanding at end of year (in dollars per share)	$ 13.09	$ 12.93	$ 12.82

Share-Based Compensation (Details 3) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	May 31, 2014 USD ($) $ / shares shares
Options Outstanding
Total Options Outstanding (in shares) \| shares	2,352
Options Exercisable
Number Exercisable (in shares) \| shares	2,349
Aggregate Intrinsic Value
Options Outstanding (in dollars) \| $	$ 22,749
Options Exercisable (in dollars) \| $	$ 22,748
$6.15-$13.08
Outstanding and exercisable options
Exercise price, lower range limit (in dollars per share)	$ 6.15
Exercise price, upper range limit (in dollars per share)	$ 13.08
Options Outstanding
Total Options Outstanding (in shares) \| shares	257
Weighted Average Remaining Life	4 years 4 months 24 days
Weighted Average Exercise Price (in dollars per share)	$ 9.87
Options Exercisable
Number Exercisable (in shares) \| shares	257
Weighted Average Exercise Price (in dollars per share)	$ 9.87
$13.46-$22.35
Outstanding and exercisable options
Exercise price, lower range limit (in dollars per share)	13.46
Exercise price, upper range limit (in dollars per share)	$ 22.35
Options Outstanding
Total Options Outstanding (in shares) \| shares	2,095
Weighted Average Remaining Life	5 years 2 months 12 days
Weighted Average Exercise Price (in dollars per share)	$ 13.48
Options Exercisable
Number Exercisable (in shares) \| shares	2,092
Weighted Average Exercise Price (in dollars per share)	$ 13.47

Share-Based Compensation (Details 4) $ in Millions	12 Months Ended
Share-Based Compensation (Details 4) $ in Millions	May 31, 2014 USD ($) item shares	May 31, 2013 USD ($) item shares	May 31, 2012 USD ($)
Non-employee directors
Share-based compensation
Number of fully vested common stock granted \| shares	19,000	13,000
Number of non-employee directors to whom fully vested common stock is granted \| item	5	5
Fair value of shares vested	$ 0.4	$ 0.3
Restricted Stock Unit Awards
Share-based compensation
Recognized share-based compensation expense	4.0	$ 2.9	$ 1.9
Unrecognized compensation cost, net of estimated forfeitures, related to restricted stock unit awards	$ 8.6
Unvested restricted stock units outstanding (in shares) \| shares	1,050,000
Weighted-average period over which unrecognized compensation cost is expected to be recognized	2 years 3 months 18 days
Shares vested \| shares	178,000	123,000
Fair value of shares vested	$ 3.3	$ 1.9
Performance restricted stock units
Share-based compensation
Requisite service period	3 years
Recognized share-based compensation expense	$ 1.2
Unrecognized compensation cost, net of estimated forfeitures, related to restricted stock unit awards	$ 7.4
Unvested restricted stock units outstanding (in shares) \| shares	423,000
Weighted-average period over which unrecognized compensation cost is expected to be recognized	2 years 3 months 18 days
Performance period	3 years

Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	May 31, 2014	May 31, 2013	May 31, 2012
Income before provision for income taxes from:
U.S. operations	$ 25,433	$ 29,573	$ 27,951
Foreign operations	9,670	(5,307)	5,686
Income before provision for income taxes	35,103	24,266	33,637
Current
Federal	8,836	9,035	8,792
States and local	1,689	1,673	1,762
Foreign	2,484	3,118	2,042
Reserve for uncertain tax positions	59	206	47
Total current	13,068	14,032	12,643
Deferred
Federal	(53)	5	216
States and local	395	134	105
Foreign	(967)	246	(359)
Total deferred	(625)	385	(38)
Net change in valuation allowance	85	(1,790)	(314)
Net deferred	(540)	(1,405)	(352)
Provision for income taxes	12,528	12,627	12,291
Reconciliation of income tax expense at the statutory rate to the effective income tax expense
Federal tax at statutory rate	12,286	8,493	11,773
State taxes, net of federal benefit	1,355	1,174	1,213
Foreign tax	(1,868)	1,744	(307)
Contingent consideration	24	(1,156)	(370)
Permanent differences	531	498	272
Goodwill impairment		3,478
Other	115	186	24
Change in valuation allowance	85	(1,790)	(314)
Provision for income taxes	$ 12,528	$ 12,627	$ 12,291
Reconciliation of the federal income tax expense
Federal tax at statutory rate (as a percent)	35.00%	35.00%	35.00%
State taxes, net of federal benefit (as a percent)	3.90%	4.80%	3.60%
Foreign tax (as a percent)	(5.30%)	7.20%	(0.90%)
Contingent consideration (as a percent)	0.10%	(4.80%)	(1.10%)
Permanent differences (as a percent)	1.50%	2.10%	0.80%
Goodwill impairment (as a percent)	0.00%	14.30%	0.00%
Other (as a percent)	0.30%	0.80%	0.00%
Change in valuation allowance (as a percent)	0.20%	(7.40%)	(0.90%)
Total provision for income taxes (as a percent)	35.70%	52.00%	36.50%

Income Taxes (Details 2) - USD ($) $ in Thousands	12 Months Ended
Income Taxes (Details 2) - USD ($) $ in Thousands	May 31, 2014	May 31, 2013	May 31, 2012
Deferred income tax assets
Allowance for doubtful accounts	$ 777	$ 745
Inventory	726	637
Intangible assets	3,316	5,220
Accrued expenses	2,580	2,505
Net operating loss carryforward	3,745	3,314
Capital lease obligation	44	452
Deferred stock based compensation	5,739	4,690
Other	108	37
Deferred income tax assets	17,035	17,600
Valuation allowance	(2,553)	(2,701)
Net deferred income tax assets	14,482	14,899
Deferred income tax liabilities
Property and equipment	(6,821)	(7,142)
Goodwill	(9,423)	(7,390)
Intangible assets	(9,057)	(9,277)
Other	(80)	(83)
Deferred income tax liabilities	(25,381)	(23,892)
Net deferred income taxes	(10,899)	(8,993)
Changes in company's gross unrecognized tax benefits, excluding interest and penalties
Balance at the beginning of the period	1,061	971	$ 375
Additions for tax positions related to the current fiscal year	36	31	24
Additions for tax positions related to prior years		93	44
Decrease for tax positions related to prior years	(10)		(22)
Current year acquisitions	63		561
Impact of foreign exchange fluctuation	(52)	(24)
Settlements	(48)	(4)
Reductions related to the expiration of statutes of limitations	(34)	(6)	(11)
Balance at the end of the period	1,016	1,061	971
Unrecognized tax benefits including penalties and interest, that would affect the effective tax rate, if recognized	1,400	1,400	$ 1,200
Anticipated decrease in unrecognized tax benefits, excluding interest and penalties within the next 12 months	100
Net income (loss) of foreign subsidiaries	8,000	$ (6,900)
Deferred tax liability recognized for the remittance of undistributed international earnings	0
State \| Expiration date starting in fiscal 2026
Income taxes
Net operating losses	400
State \| Expiration date starting in fiscal 2015
Income taxes
Net operating losses	2,600
Foreign Country
Income taxes
Net operating losses	$ 11,000

Employee Benefit Plans (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plans (Details) - USD ($) $ in Millions	May 31, 2014	May 31, 2013	May 31, 2012
401(k) savings plan
Minimum age for employees to contribute catch up contributions under IRS limits	50 years
Continuous service period required for eligibility of employees to participate under the plan	6 months
Company match amount of employee contributions matched up to 6% of annual compensation (as a percent)	50.00%
Vesting period for employer matching contribution	5 years
Contribution under 401(k) savings plan	$ 2.5	$ 2.3	$ 2.1
Maximum
Defined Contribution Plan
Percentage of employee's annual compensation for which the company contributes a matching contribution	6.00%

Employee Benefit Plans (Details 2) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plans (Details 2) - USD ($) $ in Millions	May 31, 2014	May 31, 2013	May 31, 2012
Maximum
Union plan
Amount of employers contribution to the union plan	$ 0.1	$ 0.1	$ 0.1

Related Party Transactions (Details) - Shareholder and officer $ in Millions	12 Months Ended
	May 31, 2014 USD ($)
Related Party Transactions
Total rent payments	$ 0.9
France
Related Party Transactions
Total rent payments	0.2
Brazil
Related Party Transactions
Total rent payments	$ 0.1

Obligations under Capital Leases (Details) - USD ($) $ in Thousands	12 Months Ended
	May 31, 2014	May 31, 2013
Obligations under capital leases
Net book value of assets under capital lease	$ 18,100	$ 16,100
Future minimum lease payments
2015	8,246
2016	6,256
2017	4,161
2018	2,448
2019	994
Thereafter	122
Total Minimum Lease Payments	22,227
Less: amount representing interest	(1,312)
Present value of minimum lease payments	20,915
Less: current portion of obligations under capital leases	(7,251)	(6,766)
Obligations under capital leases, net of current portion	13,664	$ 10,923
Minimum
Obligations under capital leases
Required monthly payments	$ 1
Effective interest rate (as a percent)	3.00%
Maximum
Obligations under capital leases
Required monthly payments	$ 72
Effective interest rate (as a percent)	9.00%

Commitments and Contingencies (Details) $ in Thousands	12 Months Ended
Commitments and Contingencies (Details) $ in Thousands	May 31, 2014 USD ($) item	May 31, 2013 USD ($)	May 31, 2012 USD ($)
Future minimum lease payments
2015	$ 8,141
2016	6,317
2017	5,027
2018	3,689
2019	3,401
Thereafter	6,789
Total	33,364
Total rent expense	$ 9,500	$ 7,200	$ 5,400
Litigation
Period over which potential acquisition-related contingent consideration would be payable	3 years	5 years
Lawsuits for alleged quality defects
Litigation
Number of claims filed \| item	0
Acquisition-related contingencies
Litigation
Potential acquisition-related contingent consideration, low end of range	$ 0
Potential acquisition-related contingent consideration, high end of range	27,900
Lawsuit for liability due to faulty inspections
Litigation
Estimated possible liability	0
Expected maximum possible liability	$ 46,000

Subsequent Events (Details) - Subsequent Event $ in Millions	May 31, 2014 USD ($)
Acquisition of asset protection business and asset inspection business
Subsequent events
Cash paid	$ 3.9
Notes payable to be paid for acquisition	$ 0.5
Asset protection businesses, located in Quebec, Canada
Subsequent events
Period of operation for specific performance metrics	3 years

Segment Disclosure (Details) $ in Thousands	3 Months Ended								12 Months Ended
Segment Disclosure (Details) $ in Thousands	May 31, 2014 USD ($)	Feb. 28, 2014 USD ($)	Nov. 30, 2013 USD ($)	Aug. 31, 2013 USD ($)	May 31, 2013 USD ($)	Feb. 28, 2013 USD ($)	Nov. 30, 2012 USD ($)	Aug. 31, 2012 USD ($)	May 31, 2014 USD ($) item	May 31, 2013 USD ($)	May 31, 2012 USD ($)
Segment Disclosure
Number of operating segments \| item									3
Financial information by segment
Revenues	$ 179,127	$ 151,727	$ 156,755	$ 135,838	$ 144,505	$ 133,661	$ 137,729	$ 113,387	$ 623,447	$ 529,282	$ 436,875
Gross profit	46,389	39,300	47,977	39,277	38,543	34,206	41,905	33,717	172,943	148,371	129,690
Income from operations	10,468	$ 3,000	$ 15,252	$ 9,575	(881)	$ 4,982	$ 15,747	$ 7,706	38,295	27,554	36,098
Depreciation and amortization									28,429	26,647	22,024
Intangible assets, net	57,875				52,428				57,875	52,428
Total assets	443,972				377,997				443,972	377,997
Operating segments \| Services
Financial information by segment
Revenues									443,229	380,851	349,793
Gross profit									114,182	98,907	94,413
Income from operations									43,221	40,325	39,932
Depreciation and amortization									17,794	18,296	17,763
Intangible assets, net	22,440				14,527				22,440	14,527
Total assets	249,378				200,326				249,378	200,326
Operating segments \| International
Financial information by segment
Revenues									161,395	126,840	59,466
Gross profit									44,893	32,319	19,106
Income from operations									10,238	(8,246)	3,262
Depreciation and amortization									8,065	6,200	2,342
Intangible assets, net	26,898				27,520				26,898	27,520
Total assets	155,571				139,445				155,571	139,445
Operating segments \| Products and Systems
Financial information by segment
Revenues									33,544	33,301	40,083
Gross profit									14,495	16,947	18,578
Income from operations									2,552	7,286	8,271
Depreciation and amortization									2,373	2,229	1,831
Intangible assets, net	8,310				9,600				8,310	9,600
Total assets	38,041				37,948				38,041	37,948
Corporate and eliminations
Financial information by segment
Revenues									(14,721)	(11,710)	(12,467)
Gross profit									(627)	198	(2,407)
Income from operations									(17,716)	(11,811)	(15,367)
Depreciation and amortization									197	(78)	$ 88
Intangible assets, net	227				781				227	781
Total assets	$ 982				$ 278				$ 982	$ 278

Segment Disclosure (Details 2) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
Segment Disclosure (Details 2) - USD ($) $ in Thousands	May 31, 2014	Feb. 28, 2014	Nov. 30, 2013	Aug. 31, 2013	May 31, 2013	Feb. 28, 2013	Nov. 30, 2012	Aug. 31, 2012	May 31, 2014	May 31, 2013	May 31, 2012
Revenue and long-lived assets by geographic area
Revenues	$ 179,127	$ 151,727	$ 156,755	$ 135,838	$ 144,505	$ 133,661	$ 137,729	$ 113,387	$ 623,447	$ 529,282	$ 436,875
Long-lived assets	266,202				236,117				266,202	236,117
Operating segments \| Services
Revenue and long-lived assets by geographic area
Revenues									443,229	380,851	349,793
Operating segments \| International
Revenue and long-lived assets by geographic area
Revenues									161,395	126,840	59,466
Operating segments \| Products and Systems
Revenue and long-lived assets by geographic area
Revenues									33,544	33,301	40,083
Corporate and eliminations
Revenue and long-lived assets by geographic area
Revenues									(14,721)	(11,710)	(12,467)
United States
Revenue and long-lived assets by geographic area
Revenues									403,001	347,423	336,081
Long-lived assets	141,447				122,727				141,447	122,727
Other Americas
Revenue and long-lived assets by geographic area
Revenues									55,120	55,379	40,337
Long-lived assets	33,515				28,148				33,515	28,148
Europe
Revenue and long-lived assets by geographic area
Revenues									143,931	106,416	42,820
Long-lived assets	90,194				85,171				90,194	85,171
Asia-Pacific
Revenue and long-lived assets by geographic area
Revenues									21,395	20,064	$ 17,637
Long-lived assets	$ 1,046				$ 71				$ 1,046	$ 71

Selected Quarterly Financial Information (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	May 31, 2014	Feb. 28, 2014	Nov. 30, 2013	Aug. 31, 2013	May 31, 2013	Feb. 28, 2013	Nov. 30, 2012	Aug. 31, 2012	May 31, 2014	May 31, 2013	May 31, 2012
Selected Quarterly Financial Information (unaudited)
Revenues	$ 179,127	$ 151,727	$ 156,755	$ 135,838	$ 144,505	$ 133,661	$ 137,729	$ 113,387	$ 623,447	$ 529,282	$ 436,875
Gross profit	46,389	39,300	47,977	39,277	38,543	34,206	41,905	33,717	172,943	148,371	129,690
Income from operations	10,468	3,000	15,252	9,575	(881)	4,982	15,747	7,706	38,295	27,554	36,098
Net income attributable to Mistras Group, Inc.	$ 6,419	$ 1,201	$ 9,257	$ 5,641	$ (4,549)	$ 2,751	$ 9,163	$ 4,281	$ 22,518	$ 11,646	$ 21,353
Earnings per common share:
Basic (in dollars per share)	$ 0.23	$ 0.04	$ 0.33	$ 0.20	$ (0.16)	$ 0.10	$ 0.33	$ 0.15	$ 0.79	$ 0.41	$ 0.77
Diluted (in dollars per share)	$ 0.22	$ 0.04	$ 0.32	$ 0.19	$ (0.16)	$ 0.11	$ 0.32	$ 0.15	$ 0.77	$ 0.40	$ 0.74

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Net Income
-URI http://asc.fasb.org/extlink&oid=6518256

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 230
-SubTopic 10
-Section 45
-Paragraph 28
-URI http://asc.fasb.org/extlink&oid=31042434&loc=d3e3602-108585

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 225
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04.19)
-URI http://asc.fasb.org/extlink&oid=6879464&loc=d3e573970-122913

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 225
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03.18)
-URI http://asc.fasb.org/extlink&oid=26872669&loc=d3e20235-122688

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 225
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04.22)
-URI http://asc.fasb.org/extlink&oid=6879464&loc=d3e573970-122913

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Other Comprehensive Income
-URI http://asc.fasb.org/extlink&oid=6519514

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=28358780&loc=d3e565-108580

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 03
-Paragraph 19
-Article 5

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 04
-Paragraph 20
-Article 9

+ Details