Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
☐ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
(Exact name of registrant as specified in its charter) |
Delaware | 53-0182885 | |||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||
1300 North 17th Street | , | Arlington | , | Virginia | 22209 | |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Class B Common Stock, par value $1.00 per share | GHC | New York Stock Exchange |
Large | Accelerated filer | Non-accelerated filer | Smaller reporting company | Emerging growth company |
PART I. FINANCIAL INFORMATION | ||
Item 1. | Financial Statements | |
Notes to Condensed Consolidated Financial Statements (Unaudited) | ||
Organization, Basis of Presentation and Recent Accounting Pronouncements | ||
Acquisitions and Dispositions of Businesses | ||
Investments | ||
Accounts Receivable | ||
Inventories, Contracts in Progress and Vehicle Floor Plan Payable | ||
Leases | ||
Goodwill and Other Intangible Assets | ||
Debt | ||
Fair Value Measurements | ||
Revenue From Contracts With Customers | ||
Earnings Per Share | ||
Pension and Postretirement Plans | ||
Other Non-Operating Income | ||
Accumulated Other Comprehensive Income (Loss) | ||
Contingencies and Regulatory Matters | ||
Business Segments | ||
Item 2. | Management’s Discussion and Analysis of Results of Operations and Financial Condition | |
Item 3. | Quantitative and Qualitative Disclosures about Market Risk | |
Item 4. | Controls and Procedures | |
PART II. OTHER INFORMATION | ||
Item | ||
Item 6. | Exhibits | |
Signatures |
Three Months Ended September 30 | Nine Months Ended September 30 | Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||||||
(in thousands, except per share amounts) | 2017 | 2016 | 2017 | 2016 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||
Operating Revenues | $ | 738,820 | $ | 674,766 | $ | 2,168,621 | $ | 2,006,879 | ||||||||||||||||||||||
Education | $ | 377,033 | $ | 386,936 | $ | 1,136,706 | $ | 1,207,086 | ||||||||||||||||||||||
Advertising | 69,495 | 86,531 | 207,143 | 225,590 | ||||||||||||||||||||||||||
Other | 210,697 | 148,171 | 572,180 | 419,635 | ||||||||||||||||||||||||||
657,225 | 621,638 | 1,916,029 | 1,852,311 | |||||||||||||||||||||||||||
Operating Costs and Expenses | ||||||||||||||||||||||||||||||
Operating | 352,635 | 293,194 | 1,011,553 | 880,859 | 517,935 | 448,920 | 1,498,928 | 1,254,726 | ||||||||||||||||||||||
Selling, general and administrative | 232,782 | 237,694 | 678,139 | 709,344 | 175,322 | 131,081 | 472,124 | 497,504 | ||||||||||||||||||||||
Depreciation of property, plant and equipment | 16,002 | 16,097 | 46,525 | 48,903 | 15,351 | 13,648 | 42,758 | 41,909 | ||||||||||||||||||||||
Amortization of intangible assets | 10,923 | 6,620 | 28,290 | 19,160 | 13,572 | 12,269 | 39,512 | 34,052 | ||||||||||||||||||||||
Impairment of goodwill and other long-lived assets | 312 | — | 9,536 | — | ||||||||||||||||||||||||||
Impairment of long-lived assets | 372 | 8,109 | 1,065 | 8,109 | ||||||||||||||||||||||||||
612,654 | 553,605 | 1,774,043 | 1,658,266 | 722,552 | 614,027 | 2,054,387 | 1,836,300 | |||||||||||||||||||||||
Income from Operations | 44,571 | 68,033 | 141,986 | 194,045 | 16,268 | 60,739 | 114,234 | 170,579 | ||||||||||||||||||||||
Equity in (losses) earnings of affiliates, net | (532 | ) | (1,008 | ) | 1,448 | (895 | ) | |||||||||||||||||||||||
Equity in earnings of affiliates, net | 4,683 | 9,537 | 7,829 | 13,047 | ||||||||||||||||||||||||||
Interest income | 861 | 740 | 3,397 | 2,052 | 1,474 | 611 | 4,753 | 3,884 | ||||||||||||||||||||||
Interest expense | (8,619 | ) | (8,614 | ) | (25,783 | ) | (24,533 | ) | (6,776 | ) | (6,135 | ) | (22,587 | ) | (31,371 | ) | ||||||||||||||
Other income (expense), net | 1,963 | (18,225 | ) | 6,881 | 15,871 | |||||||||||||||||||||||||
Debt extinguishment costs | — | — | — | (11,378 | ) | |||||||||||||||||||||||||
Non-operating pension and postretirement benefit income, net | 19,556 | 22,214 | 51,737 | 66,641 | ||||||||||||||||||||||||||
Gain on marketable equity securities, net | 17,404 | 44,962 | 49,261 | 28,306 | ||||||||||||||||||||||||||
Other income, net | 5,556 | 3,142 | 36,135 | 14,662 | ||||||||||||||||||||||||||
Income Before Income Taxes | 38,244 | 40,926 | 127,929 | 186,540 | 58,165 | 135,070 | 241,362 | 254,370 | ||||||||||||||||||||||
Provision for Income Taxes | 13,400 | 7,800 | 40,000 | 54,000 | 15,200 | 10,000 | 59,500 | 39,700 | ||||||||||||||||||||||
Net Income | 24,844 | 33,126 | 87,929 | 132,540 | 42,965 | 125,070 | 181,862 | 214,670 | ||||||||||||||||||||||
Net Income Attributable to Noncontrolling Interests | (60 | ) | — | (63 | ) | (868 | ) | |||||||||||||||||||||||
Net Loss (Income) Attributable to Noncontrolling Interests | 180 | (6 | ) | 112 | (149 | ) | ||||||||||||||||||||||||
Net Income Attributable to Graham Holdings Company Common Stockholders | $ | 24,784 | $ | 33,126 | $ | 87,866 | $ | 131,672 | $ | 43,145 | $ | 125,064 | $ | 181,974 | $ | 214,521 | ||||||||||||||
Per Share Information Attributable to Graham Holdings Company Common Stockholders | ||||||||||||||||||||||||||||||
Basic net income per common share | $ | 4.45 | $ | 5.90 | $ | 15.74 | $ | 23.33 | $ | 8.12 | $ | 23.43 | $ | 34.24 | $ | 39.81 | ||||||||||||||
Basic average number of common shares outstanding | 5,518 | 5,544 | 5,530 | 5,570 | 5,285 | 5,302 | 5,285 | 5,354 | ||||||||||||||||||||||
Diluted net income per common share | $ | 4.42 | $ | 5.87 | $ | 15.64 | $ | 23.21 | $ | 8.05 | $ | 23.28 | $ | 33.96 | $ | 39.54 | ||||||||||||||
Diluted average number of common shares outstanding | 5,554 | 5,574 | 5,567 | 5,600 | 5,329 | 5,337 | 5,328 | 5,390 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Net Income | $ | 24,844 | $ | 33,126 | $ | 87,929 | $ | 132,540 | |||||||
Other Comprehensive Income, Before Tax | |||||||||||||||
Foreign currency translation adjustments: | |||||||||||||||
Translation adjustments arising during the period | 11,470 | (353 | ) | 34,776 | (1,629 | ) | |||||||||
Unrealized gains on available-for-sale securities: | |||||||||||||||
Unrealized gains for the period, net | 47,836 | 12,154 | 71,370 | 7,190 | |||||||||||
Reclassification of realized gain on sale of available-for-sale securities included in net income | — | — | — | (6,256 | ) | ||||||||||
47,836 | 12,154 | 71,370 | 934 | ||||||||||||
Pension and other postretirement plans: | |||||||||||||||
Amortization of net prior service cost included in net income | 118 | 105 | 358 | 314 | |||||||||||
Amortization of net actuarial (gain) loss included in net income | (1,567 | ) | 289 | (4,958 | ) | 868 | |||||||||
(1,449 | ) | 394 | (4,600 | ) | 1,182 | ||||||||||
Cash flow hedge (loss) gain | (72 | ) | 49 | (215 | ) | 49 | |||||||||
Other Comprehensive Income, Before Tax | 57,785 | 12,244 | 101,331 | 536 | |||||||||||
Income tax expense related to items of other comprehensive income | (18,540 | ) | (5,039 | ) | (26,665 | ) | (866 | ) | |||||||
Other Comprehensive Income (Loss), Net of Tax | 39,245 | 7,205 | 74,666 | (330 | ) | ||||||||||
Comprehensive Income | 64,089 | 40,331 | 162,595 | 132,210 | |||||||||||
Comprehensive income attributable to noncontrolling interests | (60 | ) | — | (63 | ) | (868 | ) | ||||||||
Total Comprehensive Income Attributable to Graham Holdings Company | $ | 64,029 | $ | 40,331 | $ | 162,532 | $ | 131,342 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Net Income | $ | 42,965 | $ | 125,070 | $ | 181,862 | $ | 214,670 | |||||||
Other Comprehensive Loss, Before Tax | |||||||||||||||
Foreign currency translation adjustments: | |||||||||||||||
Translation adjustments arising during the period | (16,684 | ) | (2,844 | ) | (17,755 | ) | (22,447 | ) | |||||||
Pension and other postretirement plans: | |||||||||||||||
Amortization of net prior service (credit) cost included in net income | (932 | ) | 69 | (3,210 | ) | 215 | |||||||||
Amortization of net actuarial gain included in net income | (511 | ) | (3,295 | ) | (1,534 | ) | (7,956 | ) | |||||||
(1,443 | ) | (3,226 | ) | (4,744 | ) | (7,741 | ) | ||||||||
Cash flow hedges (loss) gain | (477 | ) | (6 | ) | (904 | ) | 601 | ||||||||
Other Comprehensive Loss, Before Tax | (18,604 | ) | (6,076 | ) | (23,403 | ) | (29,587 | ) | |||||||
Income tax benefit related to items of other comprehensive loss | 518 | 874 | 1,512 | 1,976 | |||||||||||
Other Comprehensive Loss, Net of Tax | (18,086 | ) | (5,202 | ) | (21,891 | ) | (27,611 | ) | |||||||
Comprehensive Income | 24,879 | 119,868 | 159,971 | 187,059 | |||||||||||
Comprehensive loss (income) attributable to noncontrolling interests | 180 | (6 | ) | 112 | (149 | ) | |||||||||
Total Comprehensive Income Attributable to Graham Holdings Company | $ | 25,059 | $ | 119,862 | $ | 160,083 | $ | 186,910 |
As of | As of | |||||||||||||
(in thousands) | September 30, 2017 | December 31, 2016 | September 30, 2019 | December 31, 2018 | ||||||||||
(Unaudited) | (Unaudited) | |||||||||||||
Assets | ||||||||||||||
Current Assets | ||||||||||||||
Cash and cash equivalents | $ | 395,009 | $ | 648,885 | $ | 142,264 | $ | 253,256 | ||||||
Restricted cash | 21,403 | 21,931 | 15,143 | 10,859 | ||||||||||
Investments in marketable equity securities and other investments | 519,586 | 448,241 | 554,211 | 514,581 | ||||||||||
Accounts receivable, net | 525,779 | 615,101 | 612,141 | 582,280 | ||||||||||
Income taxes receivable | 28,108 | 41,635 | 9,440 | 19,166 | ||||||||||
Inventories and contracts in progress | 62,531 | 34,818 | 113,196 | 69,477 | ||||||||||
Other current assets | 65,443 | 60,735 | 87,863 | 82,723 | ||||||||||
Total Current Assets | 1,617,859 | 1,871,346 | 1,534,258 | 1,532,342 | ||||||||||
Property, Plant and Equipment, Net | 259,809 | 233,664 | 370,882 | 293,085 | ||||||||||
Lease Right-of-Use Assets | 503,830 | — | ||||||||||||
Investments in Affiliates | 122,166 | 58,806 | 163,986 | 143,813 | ||||||||||
Goodwill, Net | 1,299,226 | 1,122,954 | 1,345,393 | 1,297,712 | ||||||||||
Indefinite-Lived Intangible Assets, Net | 109,901 | 66,026 | ||||||||||||
Indefinite-Lived Intangible Assets | 144,477 | 99,052 | ||||||||||||
Amortized Intangible Assets, Net | 239,152 | 107,939 | 245,393 | 263,261 | ||||||||||
Prepaid Pension Cost | 863,098 | 881,593 | 1,038,676 | 1,003,558 | ||||||||||
Deferred Income Taxes | 15,820 | 17,246 | 11,400 | 13,388 | ||||||||||
Deferred Charges and Other Assets | 92,884 | 73,096 | 129,451 | 117,830 | ||||||||||
Total Assets | $ | 4,619,915 | $ | 4,432,670 | $ | 5,487,746 | $ | 4,764,041 | ||||||
Liabilities and Equity | ||||||||||||||
Current Liabilities | ||||||||||||||
Accounts payable and accrued liabilities | $ | 446,076 | $ | 500,726 | $ | 477,522 | $ | 486,578 | ||||||
Deferred revenue | 353,367 | 312,107 | 337,573 | 308,728 | ||||||||||
Income taxes payable | 6,668 | 10,496 | ||||||||||||
Current portion of lease liabilities | 78,114 | — | ||||||||||||
Current portion of long-term debt | 6,713 | 6,128 | 81,697 | 6,360 | ||||||||||
Dividends declared | 7,025 | — | 7,387 | — | ||||||||||
Total Current Liabilities | 813,181 | 818,961 | 988,961 | 812,162 | ||||||||||
Postretirement Benefits Other Than Pensions | 22,929 | 21,859 | ||||||||||||
Accrued Compensation and Related Benefits | 198,907 | 195,910 | 177,116 | 179,652 | ||||||||||
Other Liabilities | 67,589 | 65,554 | 27,398 | 57,901 | ||||||||||
Deferred Income Taxes | 454,027 | 379,092 | 348,054 | 322,421 | ||||||||||
Mandatorily Redeemable Noncontrolling Interest | 12,584 | 12,584 | ||||||||||||
Lease Liabilities | 462,868 | — | ||||||||||||
Long-Term Debt | 486,242 | 485,719 | 420,535 | 470,777 | ||||||||||
Total Liabilities | 2,055,459 | 1,979,679 | 2,424,932 | 1,842,913 | ||||||||||
Redeemable Noncontrolling Interest | 3,779 | 50 | 3,903 | 4,346 | ||||||||||
Preferred Stock | — | — | — | — | ||||||||||
Common Stockholders’ Equity | ||||||||||||||
Common stock | 20,000 | 20,000 | 20,000 | 20,000 | ||||||||||
Capital in excess of par value | 368,505 | 364,363 | 379,923 | 378,837 | ||||||||||
Retained earnings | 5,648,479 | 5,588,942 | 6,388,546 | 6,236,125 | ||||||||||
Accumulated other comprehensive income (loss), net of tax | ||||||||||||||
Accumulated other comprehensive income, net of tax | ||||||||||||||
Cumulative foreign currency translation adjustment | 7,778 | (26,998 | ) | (47,025 | ) | (29,270 | ) | |||||||
Unrealized gain on available-for-sale securities | 135,753 | 92,931 | ||||||||||||
Unrealized gain on pensions and other postretirement plans | 168,070 | 170,830 | 229,373 | 232,836 | ||||||||||
Cash flow hedge | (449 | ) | (277 | ) | ||||||||||
Cash flow hedges | (410 | ) | 263 | |||||||||||
Cost of Class B common stock held in treasury | (3,787,459 | ) | (3,756,850 | ) | (3,918,397 | ) | (3,922,009 | ) | ||||||
Total Common Stockholders’ Equity | 3,052,010 | 2,916,782 | ||||||||||||
Noncontrolling Interest | 6,901 | — | ||||||||||||
Total Equity | 2,560,677 | 2,452,941 | 3,058,911 | 2,916,782 | ||||||||||
Total Liabilities and Equity | $ | 4,619,915 | $ | 4,432,670 | $ | 5,487,746 | $ | 4,764,041 |
Nine Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||
(in thousands) | 2017 | 2016 | 2019 | 2018 | ||||||||||
Cash Flows from Operating Activities | ||||||||||||||
Net Income | $ | 87,929 | $ | 132,540 | $ | 181,862 | $ | 214,670 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
Depreciation, amortization and goodwill and other long-lived asset impairment | 84,351 | 68,063 | ||||||||||||
Net pension benefit | (44,281 | ) | (36,714 | ) | ||||||||||
Early retirement program expense | 932 | — | ||||||||||||
Depreciation, amortization and impairment of long-lived assets | 83,335 | 84,070 | ||||||||||||
Amortization of lease right-of-use asset | 61,797 | — | ||||||||||||
Net pension benefit and special separation benefit expense | (33,061 | ) | (55,458 | ) | ||||||||||
Gain on marketable equity securities and cost method investments, net | (54,341 | ) | (36,793 | ) | ||||||||||
Gain on disposition of businesses, property, plant and equipment and investments, net | (28,871 | ) | (13,379 | ) | ||||||||||
Provision for doubtful trade and other receivables | 21,532 | 7,858 | ||||||||||||
Debt extinguishment costs | — | 10,563 | ||||||||||||
Stock-based compensation expense, net | 7,528 | 10,319 | 4,752 | 5,172 | ||||||||||
Loss (gain) on disposition of businesses, property, plant and equipment, investments and other assets, net | 504 | (62,132 | ) | |||||||||||
Foreign exchange (gain) loss | (6,608 | ) | 33,324 | (1,284 | ) | 2,205 | ||||||||
Write-down of cost method investments | 200 | 15,161 | — | 2,500 | ||||||||||
Equity in (earnings) losses of affiliates, net of distributions | (1,434 | ) | 895 | |||||||||||
Equity in earnings of affiliates, net of distributions | (3,882 | ) | (10,294 | ) | ||||||||||
Provision (benefit) for deferred income taxes | 16,306 | (17,281 | ) | 26,310 | (10,867 | ) | ||||||||
Change in operating assets and liabilities: | ||||||||||||||
Accounts receivable, net | 106,230 | 5,980 | (47,308 | ) | 47,342 | |||||||||
Inventories | (11,969 | ) | (10,913 | ) | ||||||||||
Accounts payable and accrued liabilities | (63,255 | ) | (38,099 | ) | (60,708 | ) | (95,100 | ) | ||||||
Deferred revenue | 27,254 | 28,014 | 24,920 | 38,148 | ||||||||||
Income taxes receivable | 14,477 | 27,206 | 5,526 | 23,073 | ||||||||||
Other assets and other liabilities, net | (9,795 | ) | (16,492 | ) | (96,913 | ) | (12,844 | ) | ||||||
Other | 519 | 671 | 587 | 1,905 | ||||||||||
Net Cash Provided by Operating Activities | 220,857 | 151,455 | 72,284 | 191,858 | ||||||||||
Cash Flows from Investing Activities | ||||||||||||||
Investments in certain businesses, net of cash acquired | (299,938 | ) | (242,472 | ) | (162,060 | ) | (111,451 | ) | ||||||
Purchases of property, plant and equipment | (75,712 | ) | (58,850 | ) | ||||||||||
Net proceeds (payments) from disposition of businesses, property, plant and equipment and investments | 53,785 | (13,483 | ) | |||||||||||
Investments in equity affiliates, cost method and other investments | (66,097 | ) | (4,550 | ) | (25,836 | ) | (10,679 | ) | ||||||
Purchases of property, plant and equipment | (43,863 | ) | (41,373 | ) | ||||||||||
Disbursement of loan to affiliate | (6,771 | ) | (7,730 | ) | ||||||||||
Return of investment in equity affiliate | 3,527 | — | ||||||||||||
Net proceeds from disposition of businesses, property, plant and equipment, investments and other assets | 2,672 | 36,777 | ||||||||||||
Proceeds from sales of marketable equity securities | — | 22,837 | 17,586 | 66,741 | ||||||||||
Purchases of marketable equity securities | — | (48,265 | ) | (7,499 | ) | — | ||||||||
Loan to related party and advance related to Kaplan University transaction | (3,500 | ) | (28,061 | ) | ||||||||||
Return of investment in equity affiliates | 786 | 4,521 | ||||||||||||
Net Cash Used in Investing Activities | (410,470 | ) | (284,776 | ) | (202,450 | ) | (151,262 | ) | ||||||
Cash Flows from Financing Activities | ||||||||||||||
Common shares repurchased | (35,394 | ) | (90,328 | ) | — | (110,848 | ) | |||||||
Issuance of borrowings | 30,000 | 400,000 | ||||||||||||
Net borrowing under revolving credit facility | 5,000 | — | ||||||||||||
Net proceeds from vehicle floor plan payable | 15,106 | — | ||||||||||||
Dividends paid | (21,304 | ) | (20,532 | ) | (22,167 | ) | (21,564 | ) | ||||||
Repayments of borrowings | (7,712 | ) | — | |||||||||||
Deferred payments of acquisition and noncontrolling interest | (5,187 | ) | — | |||||||||||
Issuance of borrowings | — | 98,610 | ||||||||||||
Issuance of noncontrolling interest | 6,536 | — | ||||||||||||
Purchase of noncontrolling interest | — | (21,000 | ) | (550 | ) | (16,500 | ) | |||||||
Payments of financing costs | — | (648 | ) | |||||||||||
Repayments of borrowings and early redemption premium | (7,901 | ) | (417,112 | ) | ||||||||||
Payments of debt financing costs | (33 | ) | (6,490 | ) | ||||||||||
Other | (4,962 | ) | 16,608 | (356 | ) | 5,303 | ||||||||
Net Cash Used in Financing Activities | (74,559 | ) | (17,290 | ) | ||||||||||
Net Cash Provided by (Used in) Financing Activities | 25,635 | (167,211 | ) | |||||||||||
Effect of Currency Exchange Rate Change | 9,768 | (3,147 | ) | (2,177 | ) | (4,216 | ) | |||||||
Net Decrease in Cash and Cash Equivalents and Restricted Cash | (254,404 | ) | (153,758 | ) | (106,708 | ) | (130,831 | ) | ||||||
Beginning Cash and Cash Equivalents and Restricted Cash | 670,816 | 774,952 | 264,115 | 407,566 | ||||||||||
Ending Cash and Cash Equivalents and Restricted Cash | $ | 416,412 | $ | 621,194 | $ | 157,407 | $ | 276,735 |
(in thousands) | Common Stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Income | Treasury Stock | Noncontrolling Interest | Total Equity | Redeemable Noncontrolling Interest | |||||||||||||||||
As of December 31, 2018 | $ | 20,000 | $ | 378,837 | $ | 6,236,125 | $ | 203,829 | $ | (3,922,009 | ) | $ | — | $ | 2,916,782 | $ | 4,346 | ||||||||
Net income for the period | 81,702 | 81,702 | |||||||||||||||||||||||
Issuance of noncontrolling interest | 6,000 | 6,000 | |||||||||||||||||||||||
Net loss attributable to noncontrolling interest | 62 | (62 | ) | — | |||||||||||||||||||||
Net income attributable to redeemable noncontrolling interests | (16 | ) | (16 | ) | 16 | ||||||||||||||||||||
Change in redemption value of redeemable noncontrolling interests | (54 | ) | (54 | ) | 54 | ||||||||||||||||||||
Dividends on common stock | (14,779 | ) | (14,779 | ) | |||||||||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures | (3,783 | ) | 3,755 | (28 | ) | ||||||||||||||||||||
Amortization of unearned stock compensation and stock option expense | 1,639 | 1,639 | |||||||||||||||||||||||
Other comprehensive income, net of income taxes | 8,290 | 8,290 | |||||||||||||||||||||||
Purchase of redeemable noncontrolling interest | — | (550 | ) | ||||||||||||||||||||||
As of March 31, 2019 | $ | 20,000 | $ | 376,639 | $ | 6,303,094 | $ | 212,119 | $ | (3,918,254 | ) | $ | 5,938 | $ | 2,999,536 | $ | 3,866 | ||||||||
Net income for the period | 57,195 | 57,195 | |||||||||||||||||||||||
Net income attributable to noncontrolling interest | (104 | ) | 104 | — | |||||||||||||||||||||
Net income attributable to redeemable noncontrolling interests | (10 | ) | (10 | ) | 10 | ||||||||||||||||||||
Dividends on common stock | (7,388 | ) | (7,388 | ) | |||||||||||||||||||||
Amortization of unearned stock compensation and stock option expense | 1,616 | 1,616 | |||||||||||||||||||||||
Other comprehensive loss, net of income taxes | (12,095 | ) | (12,095 | ) | |||||||||||||||||||||
As of June 30, 2019 | $ | 20,000 | $ | 378,255 | $ | 6,352,787 | $ | 200,024 | $ | (3,918,254 | ) | $ | 6,042 | $ | 3,038,854 | $ | 3,876 | ||||||||
Net income for the period | 42,965 | 42,965 | |||||||||||||||||||||||
Issuance of noncontrolling interest | 536 | 536 | |||||||||||||||||||||||
Net loss attributable to noncontrolling interest | 207 | (207 | ) | — | |||||||||||||||||||||
Acquisition of noncontrolling interest | 530 | 530 | |||||||||||||||||||||||
Net income attributable to redeemable noncontrolling interests | (27 | ) | (27 | ) | 27 | ||||||||||||||||||||
Dividends on common stock | (7,386 | ) | (7,386 | ) | |||||||||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures | (1 | ) | (143 | ) | (144 | ) | |||||||||||||||||||
Amortization of unearned stock compensation and stock option expense | 1,669 | 1,669 | |||||||||||||||||||||||
Other comprehensive loss, net of income taxes | (18,086 | ) | (18,086 | ) | |||||||||||||||||||||
As of September 30, 2019 | $ | 20,000 | $ | 379,923 | $ | 6,388,546 | $ | 181,938 | $ | (3,918,397 | ) | $ | 6,901 | $ | 3,058,911 | $ | 3,903 |
(in thousands) | Common Stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Income | Treasury Stock | Noncontrolling Interest | Total Equity | Redeemable Noncontrolling Interest | |||||||||||||||||
As of December 31, 2017 | $ | 20,000 | $ | 370,700 | $ | 5,791,724 | $ | 535,555 | $ | (3,802,834 | ) | $ | — | $ | 2,915,145 | $ | 4,607 | ||||||||
Net income for the period | 42,965 | 42,965 | |||||||||||||||||||||||
Net income attributable to redeemable noncontrolling interests | (73 | ) | (73 | ) | 73 | ||||||||||||||||||||
Dividends on common stock | (14,638 | ) | (14,638 | ) | |||||||||||||||||||||
Repurchase of Class B common stock | (79,001 | ) | (79,001 | ) | |||||||||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures | (189 | ) | 119 | (70 | ) | ||||||||||||||||||||
Amortization of unearned stock compensation and stock option expense | 2,325 | 2,325 | |||||||||||||||||||||||
Other comprehensive income, net of income taxes | 10,812 | 10,812 | |||||||||||||||||||||||
Cumulative effect of accounting change | 201,812 | (194,889 | ) | 6,923 | |||||||||||||||||||||
As of March 31, 2018 | $ | 20,000 | $ | 372,836 | $ | 6,021,790 | $ | 351,478 | $ | (3,881,716 | ) | $ | — | $ | 2,884,388 | $ | 4,680 | ||||||||
Net income for the period | 46,635 | 46,635 | |||||||||||||||||||||||
Net income attributable to redeemable noncontrolling interests | (70 | ) | (70 | ) | 70 | ||||||||||||||||||||
Dividends on common stock | (6,949 | ) | (6,949 | ) | |||||||||||||||||||||
Repurchase of Class B common stock | (15,091 | ) | (15,091 | ) | |||||||||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures | (496 | ) | (494 | ) | (990 | ) | |||||||||||||||||||
Amortization of unearned stock compensation and stock option expense | 2,162 | 2,162 | |||||||||||||||||||||||
Other comprehensive loss, net of income taxes | (33,221 | ) | (33,221 | ) | |||||||||||||||||||||
As of June 30, 2018 | $ | 20,000 | $ | 374,502 | $ | 6,061,406 | $ | 318,257 | $ | (3,897,301 | ) | $ | — | $ | 2,876,864 | $ | 4,750 | ||||||||
Net income for the period | 125,070 | 125,070 | |||||||||||||||||||||||
Net income attributable to redeemable noncontrolling interests | (6 | ) | (6 | ) | 6 | ||||||||||||||||||||
Dividends on common stock | (7,048 | ) | (7,048 | ) | |||||||||||||||||||||
Repurchase of Class B common stock | (16,757 | ) | (16,757 | ) | |||||||||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures | (27 | ) | (27 | ) | |||||||||||||||||||||
Amortization of unearned stock compensation and stock option expense | 1,937 | 1,937 | |||||||||||||||||||||||
Other comprehensive loss, net of income taxes | (5,202 | ) | (5,202 | ) | |||||||||||||||||||||
Other | — | (50 | ) | ||||||||||||||||||||||
As of September 30, 2018 | $ | 20,000 | $ | 376,412 | $ | 6,179,422 | $ | 313,055 | $ | (3,914,058 | ) | $ | — | $ | 2,974,831 | $ | 4,706 |
Nine Months Ended September 30, 2016 | |||||||||||
As | |||||||||||
Previously | As | ||||||||||
(in thousands) | Reported | Adjustment | Adopted | ||||||||
Cash Flows from Operating Activities | |||||||||||
Increase in Restricted Cash | $ | (7,266 | ) | $ | 7,266 | $ | — | ||||
Net Cash Provided by Operating Activities | 144,189 | 7,266 | 151,455 | ||||||||
Net Decrease in Cash and Cash Equivalents and Restricted Cash | (161,024 | ) | 7,266 | (153,758 | ) | ||||||
Cash and Cash Equivalents and Restricted Cash at Beginning of Period | 754,207 | 20,745 | 774,952 | ||||||||
Cash and Cash Equivalents and Restricted Cash at End of Period | 593,183 | 28,011 | 621,194 |
Income from Operations | Non-operating pension and postretirement benefit income | Income Before Income Taxes | |||||||||
(in thousands) | |||||||||||
Three Months Ended September 30, 2017 | |||||||||||
As Reported | $ | 44,571 | $ | — | $ | 38,244 | |||||
Adjustment | (17,621 | ) | 17,621 | — | |||||||
Upon Adoption | 26,950 | 17,621 | 38,244 | ||||||||
Three Months Ended September 30, 2016 | |||||||||||
As Reported | $ | 68,033 | $ | — | $ | 40,926 | |||||
Adjustment | (15,705 | ) | 15,705 | — | |||||||
Upon Adoption | 52,328 | 15,705 | 40,926 | ||||||||
Nine Months Ended September 30, 2017 | |||||||||||
As Reported | $ | 141,986 | $ | — | $ | 127,929 | |||||
Adjustment | (55,042 | ) | 55,042 | — | |||||||
Upon Adoption | 86,944 | 55,042 | 127,929 | ||||||||
Nine Months Ended September 30, 2016 | |||||||||||
As Reported | $ | 194,045 | $ | — | $ | 186,540 | |||||
Adjustment | (46,966 | ) | 46,966 | — | |||||||
Upon Adoption | 147,079 | 46,966 | 186,540 | ||||||||
Twelve Months Ended December 31, 2016 | |||||||||||
As Reported | $ | 303,534 | $ | — | $ | 250,658 | |||||
Adjustment | (80,665 | ) | 80,665 | — | |||||||
Upon Adoption | 222,869 | 80,665 | 250,658 |
As of | |||||||
September 30, 2017 | December 31, 2016 | ||||||
(in thousands) | |||||||
Total cost | $ | 269,343 | $ | 269,343 | |||
Gross unrealized gains | 226,256 | 154,886 | |||||
Total Fair Value | $ | 495,599 | $ | 424,229 |
Balance as of December 31, 2018 | Adjustments | Balance as of January 1, 2019 | |||||||
Assets | |||||||||
Other current assets | $ | 82,723 | $ | (5,595 | ) | $ | 77,128 | ||
Lease Right-of-Use Assets | — | 369,333 | 369,333 | ||||||
Liabilities | |||||||||
Accounts payable and accrued liabilities | $ | 486,578 | $ | (14,029 | ) | $ | 472,549 | ||
Current portion of lease liabilities | — | 86,747 | 86,747 | ||||||
Other Liabilities | 57,901 | (40,500 | ) | 17,401 | |||||
Lease Liabilities | — | 331,520 | 331,520 |
Purchase Price Allocation | |||||||
Nine Months Ended | Year Ended | ||||||
(in thousands) | September 30, 2019 | December 31, 2018 | |||||
Accounts receivable | $ | 4,697 | $ | 2,344 | |||
Inventory | 31,750 | 1,268 | |||||
Property, plant and equipment | 52,577 | 1,518 | |||||
Lease Right-of-Use Assets | 100,933 | — | |||||
Goodwill | 63,387 | 41,840 | |||||
Indefinite-lived intangible assets | 46,900 | — | |||||
Amortized intangible assets | 21,291 | 78,427 | |||||
Other assets | 8,352 | 5,198 | |||||
Floor plan payables | (25,755 | ) | — | ||||
Other liabilities | (38,828 | ) | (7,678 | ) | |||
Deferred income taxes | (2,191 | ) | (4,900 | ) | |||
Current and noncurrent lease liabilities | (97,996 | ) | — | ||||
Noncontrolling interest | (530 | ) | — | ||||
Aggregate purchase price, net of cash acquired | $ | 164,587 | $ | 118,017 |
Purchase Price Allocation | |||||||
As of | |||||||
(in thousands) | September 30, 2017 | December 31, 2016 | |||||
Accounts receivable | $ | 12,502 | $ | 8,538 | |||
Inventory | 25,253 | 878 | |||||
Other current assets | 593 | 1,420 | |||||
Property, plant and equipment | 30,961 | 3,940 | |||||
Goodwill | 143,433 | 184,118 | |||||
Indefinite-lived intangible assets | 41,600 | 53,110 | |||||
Amortized intangible assets | 158,907 | 28,267 | |||||
Pension and other postretirement benefits liabilities | (59,116 | ) | — | ||||
Other liabilities | (10,822 | ) | (21,892 | ) | |||
Deferred income taxes | (34,875 | ) | (11,009 | ) | |||
Redeemable noncontrolling interest | (3,666 | ) | — | ||||
Aggregate purchase price, net of cash acquired | $ | 304,770 | $ | 247,370 |
Three Months Ended September 30 | Nine Months Ended September 30 | Three Months Ended September 30 | Nine Months Ended September 30 | |||||||||||||||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||
Operating revenues | $ | 657,225 | $ | 696,767 | $ | 1,979,784 | $ | 2,058,571 | $ | 750,076 | $ | 787,808 | $ | 2,267,502 | $ | 2,349,342 | ||||||||||||||
Net income | 24,735 | 36,250 | 96,065 | 137,967 | 43,849 | 125,761 | 178,551 | 217,589 |
(in thousands) | Three Months Ended September 30, 2018 | Nine Months Ended September 30, 2018 | |||||
Revenue | $ | — | $ | 91,526 | |||
Operating income | — | 213 |
As of | |||||||
September 30, 2019 | December 31, 2018 | ||||||
(in thousands) | |||||||
Total cost | $ | 282,349 | $ | 282,563 | |||
Gross unrealized gains | 253,215 | 216,111 | |||||
Gross unrealized losses | — | (2,284 | ) | ||||
Total Fair Value | $ | 535,564 | $ | 496,390 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Gain on marketable equity securities, net | $ | 17,404 | $ | 44,962 | $ | 49,261 | $ | 28,306 | |||||||
Less: Net losses (gains) in earnings from marketable equity securities sold and donated | 61 | — | (2,919 | ) | 4,271 | ||||||||||
Net unrealized gains in earnings from marketable equity securities still held at the end of the period | $ | 17,465 | $ | 44,962 | $ | 46,342 | $ | 32,577 |
As of | |||||||
September 30, 2019 | December 31, 2018 | ||||||
(in thousands) | |||||||
Receivables from contracts with customers, less doubtful accounts of $13,060 and $14,775 | $ | 582,944 | $ | 538,021 | |||
Other receivables | 29,197 | 44,259 | |||||
$ | 612,141 | $ | 582,280 |
As of | |||||||
September 30, 2019 | December 31, 2018 | ||||||
(in thousands) | |||||||
Raw materials | $ | 35,776 | $ | 37,248 | |||
Work-in-process | 11,176 | 11,633 | |||||
Finished goods | 62,451 | 17,861 | |||||
Contracts in progress | 3,793 | 2,735 | |||||
$ | 113,196 | $ | 69,477 |
(in thousands) | Three Months Ended September 30, 2019 | Nine Months Ended September 30, 2019 | |||||
Operating lease cost | $ | 26,242 | $ | 75,531 | |||
Short-term and month-to-month lease cost | 4,502 | 14,275 | |||||
Variable lease cost | 5,601 | 15,563 | |||||
Sublease income | (5,222 | ) | (14,915 | ) | |||
Total net lease cost | $ | 31,123 | $ | 90,454 |
(in thousands) | Nine Months Ended September 30, 2019 | ||
Cash Flow Information: | |||
Operating cash flows from operating leases (payments) | $ | 88,369 | |
Right-of-use assets obtained in exchange for new operating lease liabilities (noncash) | 205,455 | ||
As of September 30, 2019 | |||
Balance Sheet Information: | |||
Lease right-of-use assets | $ | 503,830 | |
Current lease liabilities | $ | 78,114 | |
Noncurrent lease liabilities | 462,868 | ||
Total lease liabilities | $ | 540,982 | |
Weighted average remaining lease term (years) | 10.8 | ||
Weighted average discount rate | 4.3 | % |
(in thousands) | September 30, 2019 | ||
2019 | $ | 20,271 | |
2020 | 103,515 | ||
2021 | 86,245 | ||
2022 | 71,147 | ||
2023 | 62,384 | ||
Thereafter | 358,758 | ||
Total payments | 702,320 | ||
Less: Imputed interest | (161,338 | ) | |
Total | $ | 540,982 |
(in thousands) | December 31, 2018 | ||
2019 | $ | 101,009 | |
2020 | 84,945 | ||
2021 | 72,031 | ||
2022 | 53,709 | ||
2023 | 47,091 | ||
Thereafter | 115,948 | ||
$ | 474,733 |
(in thousands) | Education | Television Broadcasting | Manufacturing | Healthcare | SocialCode | Other Businesses | Total | ||||||||||||||||||||
Balance as of December 31, 2018 | |||||||||||||||||||||||||||
Goodwill | $ | 1,128,699 | $ | 190,815 | $ | 231,479 | $ | 69,626 | $ | 15,860 | $ | 7,685 | $ | 1,644,164 | |||||||||||||
Accumulated impairment losses | (331,151 | ) | — | (7,616 | ) | — | — | (7,685 | ) | (346,452 | ) | ||||||||||||||||
797,548 | 190,815 | 223,863 | 69,626 | 15,860 | — | 1,297,712 | |||||||||||||||||||||
Acquisitions | 6,391 | — | 2,714 | 8,283 | — | 45,999 | 63,387 | ||||||||||||||||||||
Foreign currency exchange rate changes | (15,706 | ) | — | — | — | — | — | (15,706 | ) | ||||||||||||||||||
Balance as of September 30, 2019 | |||||||||||||||||||||||||||
Goodwill | 1,119,384 | 190,815 | 234,193 | 77,909 | 15,860 | 53,684 | 1,691,845 | ||||||||||||||||||||
Accumulated impairment losses | (331,151 | ) | — | (7,616 | ) | — | — | (7,685 | ) | (346,452 | ) | ||||||||||||||||
$ | 788,233 | $ | 190,815 | $ | 226,577 | $ | 77,909 | $ | 15,860 | $ | 45,999 | $ | 1,345,393 |
(in thousands) | Education | Television Broadcasting | Other Businesses | Total | |||||||||||
Balance as of December 31, 2016 | |||||||||||||||
Goodwill | $ | 1,111,003 | $ | 168,345 | $ | 202,141 | $ | 1,481,489 | |||||||
Accumulated impairment losses | (350,850 | ) | — | (7,685 | ) | (358,535 | ) | ||||||||
760,153 | 168,345 | 194,456 | 1,122,954 | ||||||||||||
Acquisitions | 18,986 | 24,256 | 100,191 | 143,433 | |||||||||||
Impairment | — | — | (7,616 | ) | (7,616 | ) | |||||||||
Dispositions | — | — | (412 | ) | (412 | ) | |||||||||
Foreign currency exchange rate changes | 40,867 | — | — | 40,867 | |||||||||||
Balance as of September 30, 2017 | |||||||||||||||
Goodwill | 1,170,856 | 192,601 | 301,920 | 1,665,377 | |||||||||||
Accumulated impairment losses | (350,850 | ) | — | (15,301 | ) | (366,151 | ) | ||||||||
$ | 820,006 | $ | 192,601 | $ | 286,619 | $ | 1,299,226 |
(in thousands) | Kaplan International | Higher Education | Test Preparation | Professional (U.S.) | Total | ||||||||||||||
Balance as of December 31, 2018 | |||||||||||||||||||
Goodwill | $ | 583,424 | $ | 174,564 | $ | 166,920 | $ | 203,791 | $ | 1,128,699 | |||||||||
Accumulated impairment losses | — | (111,324 | ) | (102,259 | ) | (117,568 | ) | (331,151 | ) | ||||||||||
583,424 | 63,240 | 64,661 | 86,223 | 797,548 | |||||||||||||||
Acquisitions | 6,391 | — | — | — | 6,391 | ||||||||||||||
Foreign currency exchange rate changes | (15,760 | ) | — | — | 54 | (15,706 | ) | ||||||||||||
Balance as of September 30, 2019 | |||||||||||||||||||
Goodwill | 574,055 | 174,564 | 166,920 | 203,845 | 1,119,384 | ||||||||||||||
Accumulated impairment losses | — | (111,324 | ) | (102,259 | ) | (117,568 | ) | (331,151 | ) | ||||||||||
$ | 574,055 | $ | 63,240 | $ | 64,661 | $ | 86,277 | $ | 788,233 |
(in thousands) | Higher Education | Test Preparation | Kaplan International | Total | |||||||||||
Balance as of December 31, 2016 | |||||||||||||||
Goodwill | $ | 389,720 | $ | 166,098 | $ | 555,185 | $ | 1,111,003 | |||||||
Accumulated impairment losses | (248,591 | ) | (102,259 | ) | — | (350,850 | ) | ||||||||
141,129 | 63,839 | 555,185 | 760,153 | ||||||||||||
Acquisitions | — | — | 18,986 | 18,986 | |||||||||||
Foreign currency exchange rate changes | 154 | — | 40,713 | 40,867 | |||||||||||
Balance as of September 30, 2017 | |||||||||||||||
Goodwill | 389,874 | 166,098 | 614,884 | 1,170,856 | |||||||||||
Accumulated impairment losses | (248,591 | ) | (102,259 | ) | — | (350,850 | ) | ||||||||
$ | 141,283 | $ | 63,839 | $ | 614,884 | $ | 820,006 |
As of September 30, 2017 | As of December 31, 2016 | As of September 30, 2019 | As of December 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | Useful Life Range | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Useful Life Range | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||||||||||||||||||
Amortized Intangible Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||
Student and customer relationships | 1–10 years (1) | $ | 224,872 | $ | 74,304 | $ | 150,568 | $ | 129,616 | $ | 55,863 | $ | 73,753 | 2–10 years | $ | 291,662 | $ | 136,319 | $ | 155,343 | $ | 282,761 | $ | 114,429 | $ | 168,332 | ||||||||||||||||||||||||
Trade names and trademarks | 2–10 years | 58,917 | 33,143 | 25,774 | 55,240 | 29,670 | 25,570 | 2–10 years | 92,568 | 46,204 | 46,364 | 87,285 | 39,825 | 47,460 | ||||||||||||||||||||||||||||||||||||
Network affiliation agreements | 15 years | 42,600 | 2,067 | 40,533 | — | — | — | 10 years | 17,400 | 4,712 | 12,688 | 17,400 | 3,408 | 13,992 | ||||||||||||||||||||||||||||||||||||
Databases and technology | 3–6 years (1) | 19,583 | 4,173 | 15,410 | 5,601 | 4,368 | 1,233 | 3–6 years | 30,274 | 12,221 | 18,053 | 27,041 | 8,471 | 18,570 | ||||||||||||||||||||||||||||||||||||
Noncompete agreements | 2–5 years | 2,080 | 1,549 | 531 | 1,730 | 1,404 | 326 | 2–5 years | 1,353 | 931 | 422 | 1,088 | 838 | 250 | ||||||||||||||||||||||||||||||||||||
Other | 1–8 years | 13,430 | 7,094 | 6,336 | 12,030 | 4,973 | 7,057 | 1–8 years | 24,890 | 12,367 | 12,523 | 24,530 | 9,873 | 14,657 | ||||||||||||||||||||||||||||||||||||
$ | 361,482 | $ | 122,330 | $ | 239,152 | $ | 204,217 | $ | 96,278 | $ | 107,939 | $ | 458,147 | $ | 212,754 | $ | 245,393 | $ | 440,105 | $ | 176,844 | $ | 263,261 | |||||||||||||||||||||||||||
Indefinite-Lived Intangible Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||
Trade names and trademarks | $ | 82,651 | $ | 65,192 | $ | 97,527 | $ | 80,102 | ||||||||||||||||||||||||||||||||||||||||||
Franchise agreements | 28,000 | — | ||||||||||||||||||||||||||||||||||||||||||||||||
FCC licenses | 26,600 | — | 18,800 | 18,800 | ||||||||||||||||||||||||||||||||||||||||||||||
Licensure and accreditation | 650 | 834 | 150 | 150 | ||||||||||||||||||||||||||||||||||||||||||||||
$ | 109,901 | $ | 66,026 | $ | 144,477 | $ | 99,052 |
As of | |||||||
September 30, 2019 | December 31, 2018 | ||||||
(in thousands) | |||||||
5.75% unsecured notes due June 1, 2026 (1) | $ | 395,212 | $ | 394,675 | |||
U.K. credit facility (2) | 73,683 | 82,366 | |||||
Commercial note | 28,250 | — | |||||
USD revolving credit facility | 5,000 | — | |||||
Other indebtedness | 87 | 96 | |||||
Total Debt | $ | 502,232 | $ | 477,137 | |||
Less: current portion | (81,697 | ) | (6,360 | ) | |||
Total Long-Term Debt | $ | 420,535 | $ | 470,777 |
As of | |||||||
September 30, 2017 | December 31, 2016 | ||||||
(in thousands) | |||||||
7.25% unsecured notes due February 1, 2019 (1) | $ | 399,393 | $ | 399,052 | |||
UK Credit facility (2) | 93,450 | 91,316 | |||||
Other indebtedness | 112 | 1,479 | |||||
Total Debt | $ | 492,955 | $ | 491,847 | |||
Less: current portion | (6,713 | ) | (6,128 | ) | |||
Total Long-Term Debt | $ | 486,242 | $ | 485,719 |
(1) | The carrying value is net of |
(2) | The carrying value is net of |
As of September 30, 2019 | |||||||||||
(in thousands) | Level 1 | Level 2 | Total | ||||||||
Assets | |||||||||||
Marketable equity securities (1) | $ | 535,564 | $ | — | $ | 535,564 | |||||
Other current investments (2) | 13,601 | 5,045 | 18,646 | ||||||||
Interest rate swap (3) | — | 162 | 162 | ||||||||
Total Financial Assets | $ | 549,165 | $ | 5,207 | $ | 554,372 | |||||
Liabilities | |||||||||||
Deferred compensation plan liabilities (4) | $ | — | $ | 33,195 | $ | 33,195 | |||||
Interest rate swap (5) | — | 706 | 706 | ||||||||
Total Financial Liabilities | $ | — | $ | 33,901 | $ | 33,901 |
As of September 30, 2017 | |||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||
Assets | |||||||||||||||
Money market investments (1) | $ | — | $ | 205,845 | $ | — | $ | 205,845 | |||||||
Marketable equity securities (3) | 495,599 | — | — | 495,599 | |||||||||||
Other current investments (4) | 9,948 | 14,039 | — | 23,987 | |||||||||||
Total Financial Assets | $ | 505,547 | $ | 219,884 | $ | — | $ | 725,431 | |||||||
Liabilities | |||||||||||||||
Deferred compensation plan liabilities (5) | $ | — | $ | 43,575 | $ | — | $ | 43,575 | |||||||
Interest rate swap (6) | — | 595 | — | 595 | |||||||||||
Mandatorily redeemable noncontrolling interest (7) | — | — | 12,584 | 12,584 | |||||||||||
Total Financial Liabilities | $ | — | $ | 44,170 | $ | 12,584 | $ | 56,754 |
As of December 31, 2018 | |||||||||||
(in thousands) | Level 1 | Level 2 | Total | ||||||||
Assets | |||||||||||
Money market investments (6) | $ | — | $ | 75,500 | $ | 75,500 | |||||
Marketable equity securities (1) | 496,390 | — | 496,390 | ||||||||
Other current investments (2) | 11,203 | 6,988 | 18,191 | ||||||||
Interest rate swap (3) | — | 369 | 369 | ||||||||
Total Financial Assets | $ | 507,593 | $ | 82,857 | $ | 590,450 | |||||
Liabilities | |||||||||||
Deferred compensation plan liabilities (4) | $ | — | $ | 36,080 | $ | 36,080 |
As of December 31, 2016 | |||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||
Assets | |||||||||||||||
Money market investments (1) | $ | — | $ | 435,258 | $ | — | $ | 435,258 | |||||||
Commercial paper (2) | 49,882 | — | — | 49,882 | |||||||||||
Marketable equity securities (3) | 424,229 | — | — | 424,229 | |||||||||||
Other current investments (4) | 6,957 | 17,055 | — | 24,012 | |||||||||||
Total Financial Assets | $ | 481,068 | $ | 452,313 | $ | — | $ | 933,381 | |||||||
Liabilities | |||||||||||||||
Deferred compensation plan liabilities (5) | $ | — | $ | 46,300 | $ | — | $ | 46,300 | |||||||
Interest rate swap (6) | — | 365 | — | 365 | |||||||||||
Mandatorily redeemable noncontrolling interest (7) | — | — | 12,584 | 12,584 | |||||||||||
Total Financial Liabilities | $ | — | $ | 46,665 | $ | 12,584 | $ | 59,249 |
(1) | The Company’s |
(2) |
Includes U.S. Government Securities, corporate bonds, mutual funds and time deposits. These investments are valued using a market approach based on the quoted market prices of the security or inputs that include quoted market prices for similar instruments and are classified as either Level 1 or Level 2 in the |
Included in Other Current Assets. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. |
(4) | Includes Graham Holdings Company’s Deferred Compensation Plan and supplemental savings plan benefits under the Graham Holdings Company’s Supplemental Executive Retirement Plan, which are included in accrued compensation and related benefits. These plans measure the market value of a participant’s balance in a notional investment account that is comprised primarily of mutual funds, which are based on observable market prices. However, since the deferred compensation obligations are not exchanged in an active market, they are classified as Level 2 in the fair value hierarchy. Realized and unrealized gains (losses) on deferred compensation are included in operating income. |
Included in Other Liabilities. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. |
The |
As of | ||||||||
September 30, 2019 | December 31, 2018 | % | ||||||
(in thousands) | Change | |||||||
Deferred revenue | $ | 341,682 | $ | 311,214 | 10 |
(in thousands) | Balance at Beginning of Period | Costs associated with new contracts | Less: Costs amortized during the period | Other | Balance at End of Period | ||||||||||||||
2019 | $ | 21,311 | $ | 29,381 | $ | (34,729 | ) | $ | (312 | ) | $ | 15,651 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands, except per share amounts) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Numerator: | |||||||||||||||
Numerator for basic earnings per share: | |||||||||||||||
Net income attributable to Graham Holdings Company common stockholders | $ | 43,145 | $ | 125,064 | $ | 181,974 | $ | 214,521 | |||||||
Less: Dividends paid-common stock outstanding and unvested restricted shares | (7,386 | ) | (7,048 | ) | (29,554 | ) | (28,635 | ) | |||||||
Undistributed earnings | 35,759 | 118,016 | 152,420 | 185,886 | |||||||||||
Percent allocated to common stockholders | 99.44 | % | 99.34 | % | 99.44 | % | 99.34 | % | |||||||
35,559 | 117,235 | 151,570 | 184,657 | ||||||||||||
Add: Dividends paid-common stock outstanding | 7,345 | 7,001 | 29,389 | 28,447 | |||||||||||
Numerator for basic earnings per share | $ | 42,904 | $ | 124,236 | $ | 180,959 | $ | 213,104 | |||||||
Add: Additional undistributed earnings due to dilutive stock options | 2 | 5 | 7 | 8 | |||||||||||
Numerator for diluted earnings per share | $ | 42,906 | $ | 124,241 | $ | 180,966 | $ | 213,112 | |||||||
Denominator: | |||||||||||||||
Denominator for basic earnings per share: | |||||||||||||||
Weighted average shares outstanding | 5,285 | 5,302 | 5,285 | 5,354 | |||||||||||
Add: Effect of dilutive stock options | 44 | 35 | 43 | 36 | |||||||||||
Denominator for diluted earnings per share | 5,329 | 5,337 | 5,328 | 5,390 | |||||||||||
Graham Holdings Company Common Stockholders: | |||||||||||||||
Basic earnings per share | $ | 8.12 | $ | 23.43 | $ | 34.24 | $ | 39.81 | |||||||
Diluted earnings per share | $ | 8.05 | $ | 23.28 | $ | 33.96 | $ | 39.54 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands, except per share amounts) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Numerator: | |||||||||||||||
Numerator for basic earnings per share: | |||||||||||||||
Net income attributable to Graham Holdings Company common stockholders | $ | 24,784 | $ | 33,126 | $ | 87,866 | $ | 131,672 | |||||||
Less: Dividends paid-common stock outstanding and unvested restricted shares | (7,047 | ) | (6,796 | ) | (28,329 | ) | (27,329 | ) | |||||||
Undistributed earnings | 17,737 | 26,330 | 59,537 | 104,343 | |||||||||||
Percent allocated to common stockholders | 99.07 | % | 98.70 | % | 99.07 | % | 98.70 | % | |||||||
17,572 | 25,987 | 58,981 | 102,987 | ||||||||||||
Add: Dividends paid-common stock outstanding | 6,981 | 6,708 | 28,066 | 26,976 | |||||||||||
Numerator for basic earnings per share | $ | 24,553 | $ | 32,695 | $ | 87,047 | $ | 129,963 | |||||||
Add: Additional undistributed earnings due to dilutive stock options | 1 | 2 | 4 | 7 | |||||||||||
Numerator for diluted earnings per share | $ | 24,554 | $ | 32,697 | $ | 87,051 | $ | 129,970 | |||||||
Denominator: | |||||||||||||||
Denominator for basic earnings per share: | |||||||||||||||
Weighted average shares outstanding | 5,518 | 5,544 | 5,530 | 5,570 | |||||||||||
Add: Effect of dilutive stock options | 36 | 30 | 37 | 30 | |||||||||||
Denominator for diluted earnings per share | 5,554 | 5,574 | 5,567 | 5,600 | |||||||||||
Graham Holdings Company Common Stockholders: | |||||||||||||||
Basic earnings per share | $ | 4.45 | $ | 5.90 | $ | 15.74 | $ | 23.33 | |||||||
Diluted earnings per share | $ | 4.42 | $ | 5.87 | $ | 15.64 | $ | 23.21 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||
Weighted average restricted stock | 14 | 21 | 12 | 23 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||
Weighted average restricted stock | 30 | 42 | 29 | 40 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Service cost | $ | 5,142 | $ | 4,473 | $ | 15,326 | $ | 13,730 | |||||||
Interest cost | 11,743 | 11,844 | 35,078 | 34,943 | |||||||||||
Expected return on assets | (30,832 | ) | (31,969 | ) | (91,955 | ) | (97,251 | ) | |||||||
Amortization of prior service cost | 824 | 36 | 2,058 | 114 | |||||||||||
Recognized actuarial gain | — | (2,974 | ) | — | (6,994 | ) | |||||||||
Net Periodic Benefit | (13,123 | ) | (18,590 | ) | (39,493 | ) | (55,458 | ) | |||||||
Curtailment gain | — | — | — | (806 | ) | ||||||||||
Special separation benefit expense | (175 | ) | — | 6,432 | — | ||||||||||
Total Benefit | $ | (13,298 | ) | $ | (18,590 | ) | $ | (33,061 | ) | $ | (56,264 | ) |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Service cost | $ | 4,591 | $ | 5,040 | $ | 14,096 | $ | 15,422 | |||||||
Interest cost | 11,980 | 12,845 | 35,945 | 38,763 | |||||||||||
Expected return on assets | (30,338 | ) | (30,348 | ) | (91,078 | ) | (91,122 | ) | |||||||
Amortization of prior service cost | 42 | 74 | 128 | 223 | |||||||||||
Recognized actuarial gain | (1,039 | ) | — | (3,372 | ) | — | |||||||||
Net Periodic Benefit | (14,764 | ) | (12,389 | ) | (44,281 | ) | (36,714 | ) | |||||||
Special separation benefit expense | 932 | — | 932 | — | |||||||||||
Total Benefit | $ | (13,832 | ) | $ | (12,389 | ) | $ | (43,349 | ) | $ | (36,714 | ) |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Service cost | $ | 214 | $ | 205 | $ | 643 | $ | 614 | |||||||
Interest cost | 1,079 | 967 | 3,236 | 2,899 | |||||||||||
Amortization of prior service cost | 85 | 77 | 254 | 233 | |||||||||||
Recognized actuarial loss | 579 | 600 | 1,736 | 1,802 | |||||||||||
Net Periodic Cost | $ | 1,957 | $ | 1,849 | $ | 5,869 | $ | 5,548 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Service cost | $ | 214 | $ | 246 | $ | 643 | $ | 738 | |||||||
Interest cost | 1,059 | 1,096 | 3,175 | 3,288 | |||||||||||
Amortization of prior service cost | 114 | 114 | 342 | 342 | |||||||||||
Recognized actuarial loss | 444 | 665 | 1,331 | 1,995 | |||||||||||
Net Periodic Cost | $ | 1,831 | $ | 2,121 | $ | 5,491 | $ | 6,363 |
As of | |||||
September 30, 2019 | December 31, 2018 | ||||
U.S. equities | 55 | % | 53 | % | |
U.S. stock index fund | 21 | % | 28 | % | |
U.S. fixed income | 17 | % | 13 | % | |
International equities | 7 | % | 6 | % | |
100 | % | 100 | % |
As of | |||||
September 30, 2017 | December 31, 2016 | ||||
U.S. equities | 51 | % | 53 | % | |
U.S. stock index fund | 32 | % | 30 | % | |
U.S. fixed income | 11 | % | 11 | % | |
International equities | 6 | % | 6 | % | |
100 | % | 100 | % |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Service cost | $ | — | $ | 267 | $ | — | $ | 803 | |||||||
Interest cost | 72 | 170 | 216 | 509 | |||||||||||
Amortization of prior service credit | (1,841 | ) | (44 | ) | (5,522 | ) | (132 | ) | |||||||
Recognized actuarial gain | (1,090 | ) | (921 | ) | (3,270 | ) | (2,764 | ) | |||||||
Net Periodic Benefit | $ | (2,859 | ) | $ | (528 | ) | $ | (8,576 | ) | $ | (1,584 | ) |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Service cost | $ | 257 | $ | 346 | $ | 771 | $ | 1,039 | |||||||
Interest cost | 195 | 308 | 584 | 923 | |||||||||||
Amortization of prior service credit | (38 | ) | (83 | ) | (112 | ) | (251 | ) | |||||||
Recognized actuarial gain | (972 | ) | (376 | ) | (2,917 | ) | (1,127 | ) | |||||||
Net Periodic (Benefit) Cost | $ | (558 | ) | $ | 195 | $ | (1,674 | ) | $ | 584 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||
Gain on sale of an equity affiliate | $ | — | $ | — | $ | 28,994 | $ | — | |||||||
Gain on cost method investments | 3,669 | 8,487 | 5,080 | 8,487 | |||||||||||
Foreign currency gain (loss), net | 661 | (116 | ) | 1,284 | (2,205 | ) | |||||||||
Impairment of a cost method investment | — | (2,500 | ) | — | (2,500 | ) | |||||||||
Gain on sales of businesses | 486 | 916 | 907 | 8,157 | |||||||||||
Gain on sale of cost method investments | 259 | — | 259 | 2,845 | |||||||||||
(Loss) gain on sale of property, plant and equipment | (38 | ) | — | (82 | ) | 2,542 | |||||||||
Other gain (loss), net | 519 | (3,645 | ) | (307 | ) | (2,664 | ) | ||||||||
Total Other Non-Operating Income | $ | 5,556 | $ | 3,142 | $ | 36,135 | $ | 14,662 |
Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||
Foreign currency gain (loss), net | $ | 1,414 | $ | (3,797 | ) | $ | 6,608 | $ | (33,324 | ) | |||||
(Loss) gain on sales of businesses | — | — | (342 | ) | 18,931 | ||||||||||
Loss on write-downs of cost method investments | (200 | ) | (15,000 | ) | (200 | ) | (15,161 | ) | |||||||
Gain on sale of land | — | — | — | 34,072 | |||||||||||
Gain on sales of marketable equity securities (see Note 2) | — | — | — | 6,256 | |||||||||||
Gain on the formation of a joint venture | — | — | — | 3,232 | |||||||||||
Other, net | 749 | 572 | 815 | 1,865 | |||||||||||
Total Other Non-Operating Income (Expense) | $ | 1,963 | $ | (18,225 | ) | $ | 6,881 | $ | 15,871 |
Three Months Ended September 30 | |||||||||||||||||||||||
2017 | 2016 | ||||||||||||||||||||||
Before-Tax | Income | After-Tax | Before-Tax | Income | After-Tax | ||||||||||||||||||
(in thousands) | Amount | Tax | Amount | Amount | Tax | Amount | |||||||||||||||||
Foreign currency translation adjustments: | |||||||||||||||||||||||
Translation adjustments arising during the period | $ | 11,470 | $ | — | $ | 11,470 | $ | (353 | ) | $ | — | $ | (353 | ) | |||||||||
Unrealized gains on available-for-sale securities: | |||||||||||||||||||||||
Unrealized gains for the period, net | 47,836 | (19,134 | ) | 28,702 | 12,154 | (4,862 | ) | 7,292 | |||||||||||||||
Pension and other postretirement plans: | |||||||||||||||||||||||
Amortization of net prior service cost included in net income | 118 | (47 | ) | 71 | 105 | (41 | ) | 64 | |||||||||||||||
Amortization of net actuarial (gain) loss included in net income | (1,567 | ) | 627 | (940 | ) | 289 | (116 | ) | 173 | ||||||||||||||
(1,449 | ) | 580 | (869 | ) | 394 | (157 | ) | 237 | |||||||||||||||
Cash flow hedge: | |||||||||||||||||||||||
(Loss) gain for the period | (72 | ) | 14 | (58 | ) | 49 | (20 | ) | 29 | ||||||||||||||
Other Comprehensive Income | $ | 57,785 | $ | (18,540 | ) | $ | 39,245 | $ | 12,244 | $ | (5,039 | ) | $ | 7,205 |
Three Months Ended September 30 | |||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||
Before-Tax | Income | After-Tax | Before-Tax | Income | After-Tax | ||||||||||||||||||
(in thousands) | Amount | Tax | Amount | Amount | Tax | Amount | |||||||||||||||||
Foreign currency translation adjustments: | |||||||||||||||||||||||
Translation adjustments arising during the period | $ | (16,684 | ) | $ | — | $ | (16,684 | ) | $ | (2,844 | ) | $ | — | $ | (2,844 | ) | |||||||
Pension and other postretirement plans: | |||||||||||||||||||||||
Amortization of net prior service (credit) cost included in net income | (932 | ) | 252 | (680 | ) | 69 | (18 | ) | 51 | ||||||||||||||
Amortization of net actuarial gain included in net income | (511 | ) | 138 | (373 | ) | (3,295 | ) | 891 | (2,404 | ) | |||||||||||||
(1,443 | ) | 390 | (1,053 | ) | (3,226 | ) | 873 | (2,353 | ) | ||||||||||||||
Cash flow hedges: | |||||||||||||||||||||||
Loss for the period | (477 | ) | 128 | (349 | ) | (6 | ) | 1 | (5 | ) | |||||||||||||
Other Comprehensive Loss | $ | (18,604 | ) | $ | 518 | $ | (18,086 | ) | $ | (6,076 | ) | $ | 874 | $ | (5,202 | ) |
Nine Months Ended September 30 | |||||||||||||||||||||||
2017 | 2016 | ||||||||||||||||||||||
Before-Tax | Income | After-Tax | Before-Tax | Income | After-Tax | ||||||||||||||||||
(in thousands) | Amount | Tax | Amount | Amount | Tax | Amount | |||||||||||||||||
Foreign currency translation adjustments: | |||||||||||||||||||||||
Translation adjustments arising during the period | $ | 34,776 | $ | — | $ | 34,776 | $ | (1,629 | ) | $ | — | $ | (1,629 | ) | |||||||||
Unrealized gains on available-for-sale securities: | |||||||||||||||||||||||
Unrealized gains for the period, net | 71,370 | (28,548 | ) | 42,822 | 7,190 | (2,876 | ) | 4,314 | |||||||||||||||
Reclassification of realized gain on sale of available-for-sale securities included in net income | — | — | — | (6,256 | ) | 2,502 | (3,754 | ) | |||||||||||||||
71,370 | (28,548 | ) | 42,822 | 934 | (374 | ) | 560 | ||||||||||||||||
Pension and other postretirement plans: | |||||||||||||||||||||||
Amortization of net prior service cost included in net income | 358 | (143 | ) | 215 | 314 | (125 | ) | 189 | |||||||||||||||
Amortization of net actuarial (gain) loss included in net income | (4,958 | ) | 1,983 | (2,975 | ) | 868 | (347 | ) | 521 | ||||||||||||||
(4,600 | ) | 1,840 | (2,760 | ) | 1,182 | (472 | ) | 710 | |||||||||||||||
Cash flow hedge: | |||||||||||||||||||||||
(Loss) gain for the period | (215 | ) | 43 | (172 | ) | 49 | (20 | ) | 29 | ||||||||||||||
Other Comprehensive Income | $ | 101,331 | $ | (26,665 | ) | $ | 74,666 | $ | 536 | $ | (866 | ) | $ | (330 | ) |
Nine Months Ended September 30 | |||||||||||||||||||||||
2019 | 2018 | ||||||||||||||||||||||
Before-Tax | Income | After-Tax | Before-Tax | Income | After-Tax | ||||||||||||||||||
(in thousands) | Amount | Tax | Amount | Amount | Tax | Amount | |||||||||||||||||
Foreign currency translation adjustments: | |||||||||||||||||||||||
Translation adjustments arising during the period | $ | (17,755 | ) | $ | — | $ | (17,755 | ) | $ | (22,447 | ) | $ | — | $ | (22,447 | ) | |||||||
Pension and other postretirement plans: | |||||||||||||||||||||||
Amortization of net prior service (credit) cost included in net income | (3,210 | ) | 867 | (2,343 | ) | 215 | (58 | ) | 157 | ||||||||||||||
Amortization of net actuarial gain included in net income | (1,534 | ) | 414 | (1,120 | ) | (7,956 | ) | 2,148 | (5,808 | ) | |||||||||||||
(4,744 | ) | 1,281 | (3,463 | ) | (7,741 | ) | 2,090 | (5,651 | ) | ||||||||||||||
Cash flow hedges: | |||||||||||||||||||||||
(Loss) gain for the period | (904 | ) | 231 | (673 | ) | 601 | (114 | ) | 487 | ||||||||||||||
Other Comprehensive Loss | $ | (23,403 | ) | $ | 1,512 | $ | (21,891 | ) | $ | (29,587 | ) | $ | 1,976 | $ | (27,611 | ) |
(in thousands, net of taxes) | Cumulative Foreign Currency Translation Adjustment | Unrealized Gain on Pensions and Other Postretirement Plans | Cash Flow Hedges | Accumulated Other Comprehensive Income | |||||||||||
Balance as of December 31, 2018 | $ | (29,270 | ) | $ | 232,836 | $ | 263 | $ | 203,829 | ||||||
Other comprehensive loss before reclassifications | (17,755 | ) | — | (562 | ) | (18,317 | ) | ||||||||
Net amount reclassified from accumulated other comprehensive income (loss) | — | (3,463 | ) | (111 | ) | (3,574 | ) | ||||||||
Other comprehensive loss, net of tax | (17,755 | ) | (3,463 | ) | (673 | ) | (21,891 | ) | |||||||
Balance as of September 30, 2019 | $ | (47,025 | ) | $ | 229,373 | $ | (410 | ) | $ | 181,938 |
(in thousands, net of taxes) | Cumulative Foreign Currency Translation Adjustment | Unrealized Gain on Available-for- Sale Securities | Unrealized Gain on Pensions and Other Postretirement Plans | Cash Flow Hedge | Accumulated Other Comprehensive Income | ||||||||||||||
Balance as of December 31, 2016 | $ | (26,998 | ) | $ | 92,931 | $ | 170,830 | $ | (277 | ) | $ | 236,486 | |||||||
Other comprehensive income (loss) before reclassifications | 34,776 | 42,822 | — | (270 | ) | 77,328 | |||||||||||||
Net amount reclassified from accumulated other comprehensive income (loss) | — | — | (2,760 | ) | 98 | (2,662 | ) | ||||||||||||
Other comprehensive income (loss), net of tax | 34,776 | 42,822 | (2,760 | ) | (172 | ) | 74,666 | ||||||||||||
Balance as of September 30, 2017 | $ | 7,778 | $ | 135,753 | $ | 168,070 | $ | (449 | ) | $ | 311,152 |
Three Months Ended September 30 | Nine Months Ended September 30 | Affected Line Item in the Condensed Consolidated Statement of Operations | |||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | |||||||||||||
Unrealized Gains on Available-for-sale Securities: | |||||||||||||||||
Realized gain for the period | $ | — | $ | — | $ | — | $ | (6,256 | ) | Other income (expense), net | |||||||
— | — | — | 2,502 | Provision for Income Taxes | |||||||||||||
— | — | — | (3,754 | ) | Net of Tax | ||||||||||||
Pension and Other Postretirement Plans: | |||||||||||||||||
Amortization of net prior service cost | 118 | 105 | 358 | 314 | (1) | ||||||||||||
Amortization of net actuarial (gain) loss | (1,567 | ) | 289 | (4,958 | ) | 868 | (1) | ||||||||||
(1,449 | ) | 394 | (4,600 | ) | 1,182 | Before tax | |||||||||||
580 | (157 | ) | 1,840 | (472 | ) | Provision for Income Taxes | |||||||||||
(869 | ) | 237 | (2,760 | ) | 710 | Net of Tax | |||||||||||
Cash Flow Hedge | |||||||||||||||||
51 | (3 | ) | 123 | (3 | ) | Interest expense | |||||||||||
(11 | ) | 1 | (25 | ) | 1 | Provision for Income Taxes | |||||||||||
40 | (2 | ) | 98 | (2 | ) | Net of Tax | |||||||||||
Total reclassification for the period | $ | (829 | ) | $ | 235 | $ | (2,662 | ) | $ | (3,046 | ) | Net of Tax |
Three Months Ended September 30 | Nine Months Ended September 30 | Affected Line Item in the Condensed Consolidated Statements of Operations | |||||||||||||||
(in thousands) | 2019 | 2018 | 2019 | 2018 | |||||||||||||
Pension and Other Postretirement Plans: | |||||||||||||||||
Amortization of net prior service (credit) cost | $ | (932 | ) | $ | 69 | $ | (3,210 | ) | $ | 215 | (1) | ||||||
Amortization of net actuarial gain | (511 | ) | (3,295 | ) | (1,534 | ) | (7,956 | ) | (1) | ||||||||
(1,443 | ) | (3,226 | ) | (4,744 | ) | (7,741 | ) | Before tax | |||||||||
390 | 873 | 1,281 | 2,090 | Provision for Income Taxes | |||||||||||||
(1,053 | ) | (2,353 | ) | (3,463 | ) | (5,651 | ) | Net of Tax | |||||||||
Cash Flow Hedges | |||||||||||||||||
(24 | ) | (59 | ) | (151 | ) | (101 | ) | Interest expense | |||||||||
11 | 11 | 40 | 19 | Provision for Income Taxes | |||||||||||||
(13 | ) | (48 | ) | (111 | ) | (82 | ) | Net of Tax | |||||||||
Total reclassification for the period | $ | (1,066 | ) | $ | (2,401 | ) | $ | (3,574 | ) | $ | (5,733 | ) | Net of Tax |
(1) | These accumulated other comprehensive income components are |
Three Months Ended | ||||||||||||
March 31, | June 30, | September 30, | ||||||||||
(in thousands) | 2019 | 2019 | 2019 | |||||||||
Operating Revenues | ||||||||||||
Education | $ | 372,454 | $ | 367,763 | $ | 357,319 | ||||||
Television broadcasting | 108,223 | 116,628 | 115,161 | |||||||||
Manufacturing | 115,157 | 114,873 | 111,676 | |||||||||
Healthcare | 37,728 | 40,641 | 40,688 | |||||||||
SocialCode | 13,447 | 16,382 | 15,975 | |||||||||
Other businesses | 45,230 | 81,359 | 98,225 | |||||||||
Corporate office | — | — | — | |||||||||
Intersegment elimination | (40 | ) | (44 | ) | (224 | ) | ||||||
$ | 692,199 | $ | 737,602 | $ | 738,820 | |||||||
Income (Loss) from Operations | ||||||||||||
Education | $ | 25,595 | $ | 26,305 | $ | (7,161 | ) | |||||
Television broadcasting | 35,540 | 44,494 | 36,813 | |||||||||
Manufacturing | 3,274 | 4,692 | 6,845 | |||||||||
Healthcare | 2,329 | 2,598 | 1,208 | |||||||||
SocialCode | (4,018 | ) | (975 | ) | (378 | ) | ||||||
Other businesses | (8,493 | ) | (5,913 | ) | (9,029 | ) | ||||||
Corporate office | (14,224 | ) | (13,238 | ) | (12,030 | ) | ||||||
$ | 40,003 | $ | 57,963 | $ | 16,268 | |||||||
Equity in Earnings of Affiliates, Net | 1,679 | 1,467 | 4,683 | |||||||||
Interest Expense, Net | (5,725 | ) | (6,807 | ) | (5,302 | ) | ||||||
Non-Operating Pension and Postretirement Benefit Income, Net | 19,928 | 12,253 | 19,556 | |||||||||
Gain on Marketable Equity Securities, Net | 24,066 | 7,791 | 17,404 | |||||||||
Other Income, Net | 29,351 | 1,228 | 5,556 | |||||||||
Income Before Income Taxes | $ | 109,302 | $ | 73,895 | $ | 58,165 | ||||||
Depreciation of Property, Plant and Equipment | ||||||||||||
Education | $ | 6,201 | $ | 6,137 | $ | 6,258 | ||||||
Television broadcasting | 3,239 | 3,293 | 3,307 | |||||||||
Manufacturing | 2,433 | 2,384 | 2,671 | |||||||||
Healthcare | 610 | 607 | 566 | |||||||||
SocialCode | 152 | 384 | 356 | |||||||||
Other businesses | 648 | 837 | 1,974 | |||||||||
Corporate office | 240 | 242 | 219 | |||||||||
$ | 13,523 | $ | 13,884 | $ | 15,351 | |||||||
Amortization of Intangible Assets and Impairment of Long-Lived Assets | ||||||||||||
Education | $ | 3,567 | $ | 4,070 | $ | 3,944 | ||||||
Television broadcasting | 1,408 | 1,408 | 1,408 | |||||||||
Manufacturing | 6,530 | 6,528 | 6,522 | |||||||||
Healthcare | 1,398 | 1,410 | 1,914 | |||||||||
SocialCode | 157 | 157 | 156 | |||||||||
Other businesses | — | — | — | |||||||||
Corporate office | — | — | — | |||||||||
$ | 13,060 | $ | 13,573 | $ | 13,944 | |||||||
Pension Service Cost | ||||||||||||
Education | $ | 2,664 | $ | 2,522 | $ | 2,603 | ||||||
Television broadcasting | 731 | 780 | 762 | |||||||||
Manufacturing | 25 | 15 | 20 | |||||||||
Healthcare | 183 | 63 | 123 | |||||||||
SocialCode | 248 | 191 | 219 | |||||||||
Other businesses | 201 | 161 | 215 | |||||||||
Corporate office | 1,169 | 1,231 | 1,200 | |||||||||
$ | 5,221 | $ | 4,963 | $ | 5,142 |
Three Months Ended | ||||||||||||||||||||||||||||||
Three Months Ended September 30 | Nine Months Ended September 30 | March 31, | June 30, | September 30, | December 31, | |||||||||||||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | 2018 | 2018 | 2018 | 2018 | ||||||||||||||||||||||
Operating Revenues | ||||||||||||||||||||||||||||||
Education | $ | 376,805 | $ | 386,936 | $ | 1,136,201 | $ | 1,207,225 | $ | 375,499 | $ | 370,005 | $ | 358,601 | $ | 346,910 | ||||||||||||||
Television broadcasting | 101,295 | 112,389 | 298,893 | 300,927 | 108,802 | 114,086 | 130,014 | 152,647 | ||||||||||||||||||||||
Manufacturing | 117,406 | 126,462 | 126,028 | 117,723 | ||||||||||||||||||||||||||
Healthcare | 37,621 | 38,208 | 35,486 | 37,960 | ||||||||||||||||||||||||||
SocialCode | 13,299 | 14,770 | 13,781 | 16,878 | ||||||||||||||||||||||||||
Other businesses | 179,125 | 122,313 | 480,935 | 344,298 | 6,833 | 9,167 | 10,856 | 17,024 | ||||||||||||||||||||||
Corporate office | — | — | — | — | — | — | — | — | ||||||||||||||||||||||
Intersegment elimination | — | — | — | (139 | ) | (24 | ) | (21 | ) | — | (55 | ) | ||||||||||||||||||
$ | 657,225 | $ | 621,638 | $ | 1,916,029 | $ | 1,852,311 | $ | 659,436 | $ | 672,677 | $ | 674,766 | $ | 689,087 | |||||||||||||||
Income (Loss) from Operations | ||||||||||||||||||||||||||||||
Education | $ | 13,391 | $ | 16,333 | $ | 55,347 | $ | 63,713 | $ | 22,700 | $ | 37,554 | $ | 22,262 | $ | 14,620 | ||||||||||||||
Television broadcasting | 32,948 | 59,159 | 98,181 | 144,594 | 40,542 | 41,118 | 55,453 | 73,420 | ||||||||||||||||||||||
Manufacturing | 8,628 | 8,665 | 5,146 | 6,412 | ||||||||||||||||||||||||||
Healthcare | (1,391 | ) | 764 | (8,702 | ) | 928 | ||||||||||||||||||||||||
SocialCode | (3,781 | ) | (1,742 | ) | 5,124 | (682 | ) | |||||||||||||||||||||||
Other businesses | (7,033 | ) | (10,801 | ) | (26,515 | ) | (21,593 | ) | (8,542 | ) | (7,977 | ) | (5,657 | ) | (5,840 | ) | ||||||||||||||
Corporate office | 5,265 | 3,342 | 14,973 | 7,331 | (13,942 | ) | (12,756 | ) | (12,887 | ) | (13,276 | ) | ||||||||||||||||||
$ | 44,571 | $ | 68,033 | $ | 141,986 | $ | 194,045 | $ | 44,214 | $ | 65,626 | $ | 60,739 | $ | 75,582 | |||||||||||||||
Equity in Earnings (Losses) of Affiliates, Net | (532 | ) | (1,008 | ) | 1,448 | (895 | ) | |||||||||||||||||||||||
Equity in Earnings of Affiliates, Net | 2,579 | 931 | 9,537 | 1,426 | ||||||||||||||||||||||||||
Interest Expense, Net | (7,758 | ) | (7,874 | ) | (22,386 | ) | (22,481 | ) | (6,699 | ) | (15,264 | ) | (5,524 | ) | (5,062 | ) | ||||||||||||||
Other Income (Expense), Net | 1,963 | (18,225 | ) | 6,881 | 15,871 | |||||||||||||||||||||||||
Income Before Income Taxes | $ | 38,244 | $ | 40,926 | $ | 127,929 | $ | 186,540 | ||||||||||||||||||||||
Debt Extinguishment Costs | — | (11,378 | ) | — | — | |||||||||||||||||||||||||
Non-Operating Pension and Postretirement Benefit Income | 21,386 | 23,041 | 22,214 | 53,900 | ||||||||||||||||||||||||||
(Loss) Gain on Marketable Equity Securities, Net | (14,102 | ) | (2,554 | ) | 44,962 | (44,149 | ) | |||||||||||||||||||||||
Other Income (Loss), Net | 9,187 | 2,333 | 3,142 | (12,559 | ) | |||||||||||||||||||||||||
Income from Continuing Operations Before Income Taxes | $ | 56,565 | $ | 62,735 | $ | 135,070 | $ | 69,138 | ||||||||||||||||||||||
Depreciation of Property, Plant and Equipment | ||||||||||||||||||||||||||||||
Education | $ | 8,085 | $ | 9,977 | $ | 24,994 | $ | 31,322 | $ | 7,606 | $ | 6,839 | $ | 6,685 | $ | 6,969 | ||||||||||||||
Television broadcasting | 3,118 | 2,540 | 8,703 | 7,367 | 3,071 | 2,974 | 3,198 | 3,961 | ||||||||||||||||||||||
Manufacturing | 2,451 | 2,331 | 2,333 | 2,400 | ||||||||||||||||||||||||||
Healthcare | 653 | 647 | 648 | 629 | ||||||||||||||||||||||||||
SocialCode | 233 | 200 | 187 | 177 | ||||||||||||||||||||||||||
Other businesses | 4,520 | 3,289 | 11,968 | 9,389 | 375 | 375 | 345 | 428 | ||||||||||||||||||||||
Corporate office | 279 | 291 | 860 | 825 | 253 | 253 | 252 | 249 | ||||||||||||||||||||||
$ | 16,002 | $ | 16,097 | $ | 46,525 | $ | 48,903 | $ | 14,642 | $ | 13,619 | $ | 13,648 | $ | 14,813 | |||||||||||||||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | ||||||||||||||||||||||||||||||
Amortization of Intangible Assets and Impairment of Long-lived Assets | ||||||||||||||||||||||||||||||
Education | $ | 1,355 | $ | 1,773 | $ | 3,798 | $ | 5,158 | $ | 1,149 | $ | 1,663 | $ | 2,682 | $ | 3,868 | ||||||||||||||
Television broadcasting | 1,071 | 63 | 2,943 | 189 | 1,408 | 1,408 | 1,408 | 1,408 | ||||||||||||||||||||||
Manufacturing | 5,936 | 5,935 | 6,345 | 6,530 | ||||||||||||||||||||||||||
Healthcare | 1,808 | 1,809 | 9,839 | 1,399 | ||||||||||||||||||||||||||
SocialCode | 83 | 584 | 104 | 157 | ||||||||||||||||||||||||||
Other businesses | 8,809 | 4,784 | 31,085 | 13,813 | — | — | — | — | ||||||||||||||||||||||
Corporate office | — | — | — | — | — | — | — | — | ||||||||||||||||||||||
$ | 11,235 | $ | 6,620 | $ | 37,826 | $ | 19,160 | $ | 10,384 | $ | 11,399 | $ | 20,378 | $ | 13,362 | |||||||||||||||
Net Pension (Credit) Expense | ||||||||||||||||||||||||||||||
Pension Service Cost | ||||||||||||||||||||||||||||||
Education | $ | 2,430 | $ | 2,838 | $ | 7,289 | $ | 8,965 | $ | 2,664 | $ | 1,878 | $ | 2,107 | $ | 2,104 | ||||||||||||||
Television broadcasting | 485 | 428 | 1,457 | 1,285 | 493 | 601 | 544 | 550 | ||||||||||||||||||||||
Manufacturing | 17 | 19 | 18 | 18 | ||||||||||||||||||||||||||
Healthcare | 122 | 165 | 143 | 143 | ||||||||||||||||||||||||||
SocialCode | 156 | 205 | 181 | 181 | ||||||||||||||||||||||||||
Other businesses | 1,375 | 279 | 2,273 | 839 | 116 | 154 | 147 | 161 | ||||||||||||||||||||||
Corporate office | (18,122 | ) | (15,934 | ) | (54,368 | ) | (47,803 | ) | 1,372 | 1,295 | 1,333 | 1,334 | ||||||||||||||||||
$ | (13,832 | ) | $ | (12,389 | ) | $ | (43,349 | ) | $ | (36,714 | ) | $ | 4,940 | $ | 4,317 | $ | 4,473 | $ | 4,491 |
Nine months ended | Year Ended | ||||||||||||||
September 30 | December 31 | ||||||||||||||
(in thousands) | 2019 | 2018 | 2018 | 2017 | |||||||||||
Operating Revenues | |||||||||||||||
Education | $ | 1,097,536 | $ | 1,104,105 | $ | 1,451,015 | $ | 1,516,776 | |||||||
Television broadcasting | 340,012 | 352,902 | 505,549 | 409,916 | |||||||||||
Manufacturing | 341,706 | 369,896 | 487,619 | 414,193 | |||||||||||
Healthcare | 119,057 | 111,315 | 149,275 | 154,202 | |||||||||||
SocialCode | 45,804 | 41,850 | 58,728 | 62,077 | |||||||||||
Other businesses | 224,814 | 26,856 | 43,880 | 34,733 | |||||||||||
Corporate office | — | — | — | — | |||||||||||
Intersegment elimination | (308 | ) | (45 | ) | (100 | ) | (51 | ) | |||||||
$ | 2,168,621 | $ | 2,006,879 | $ | 2,695,966 | $ | 2,591,846 | ||||||||
Income (Loss) from Operations | |||||||||||||||
Education | $ | 44,739 | $ | 82,516 | $ | 97,136 | $ | 77,687 | |||||||
Television broadcasting | 116,847 | 137,113 | 210,533 | 139,258 | |||||||||||
Manufacturing | 14,811 | 22,439 | 28,851 | 14,947 | |||||||||||
Healthcare | 6,135 | (9,329 | ) | (8,401 | ) | (2,569 | ) | ||||||||
SocialCode | (5,371 | ) | (399 | ) | (1,081 | ) | (3,674 | ) | |||||||
Other businesses | (23,435 | ) | (22,176 | ) | (28,016 | ) | (30,536 | ) | |||||||
Corporate office | (39,492 | ) | (39,585 | ) | (52,861 | ) | (58,710 | ) | |||||||
$ | 114,234 | $ | 170,579 | $ | 246,161 | $ | 136,403 | ||||||||
Equity in Earnings (Losses) of Affiliates, Net | 7,829 | 13,047 | 14,473 | (3,249 | ) | ||||||||||
Interest Expense, Net | (17,834 | ) | (27,487 | ) | (32,549 | ) | (27,305 | ) | |||||||
Debt Extinguishment Costs | — | (11,378 | ) | (11,378 | ) | — | |||||||||
Non-Operating Pension and Postretirement Benefit Income, Net | 51,737 | 66,641 | 120,541 | 72,699 | |||||||||||
Gain (Loss) on Marketable Equity Securities, Net | 49,261 | 28,306 | (15,843 | ) | — | ||||||||||
Other Income, Net | 36,135 | 14,662 | 2,103 | 4,241 | |||||||||||
Income Before Income Taxes | $ | 241,362 | $ | 254,370 | $ | 323,508 | $ | 182,789 | |||||||
Depreciation of Property, Plant and Equipment | |||||||||||||||
Education | $ | 18,596 | $ | 21,130 | $ | 28,099 | $ | 32,906 | |||||||
Television broadcasting | 9,839 | 9,243 | 13,204 | 12,179 | |||||||||||
Manufacturing | 7,488 | 7,115 | 9,515 | 9,173 | |||||||||||
Healthcare | 1,783 | 1,948 | 2,577 | 4,583 | |||||||||||
SocialCode | 892 | 620 | 797 | 1,004 | |||||||||||
Other businesses | 3,459 | 1,095 | 1,523 | 1,546 | |||||||||||
Corporate office | 701 | 758 | 1,007 | 1,118 | |||||||||||
$ | 42,758 | $ | 41,909 | $ | 56,722 | $ | 62,509 | ||||||||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | |||||||||||||||
Education | $ | 11,581 | $ | 5,494 | $ | 9,362 | $ | 5,162 | |||||||
Television broadcasting | 4,224 | 4,224 | 5,632 | 6,349 | |||||||||||
Manufacturing | 19,580 | 18,216 | 24,746 | 31,052 | |||||||||||
Healthcare | 4,722 | 13,456 | 14,855 | 7,905 | |||||||||||
SocialCode | 470 | 771 | 928 | 333 | |||||||||||
Other businesses | — | — | — | — | |||||||||||
Corporate office | — | — | — | — | |||||||||||
$ | 40,577 | $ | 42,161 | $ | 55,523 | $ | 50,801 | ||||||||
Pension Service Cost | |||||||||||||||
Education | $ | 7,789 | $ | 6,649 | $ | 8,753 | $ | 9,720 | |||||||
Television broadcasting | 2,273 | 1,638 | 2,188 | 1,942 | |||||||||||
Manufacturing | 60 | 54 | 72 | 79 | |||||||||||
Healthcare | 369 | 430 | 573 | 665 | |||||||||||
SocialCode | 658 | 542 | 723 | 593 | |||||||||||
Other businesses | 577 | 417 | 578 | 453 | |||||||||||
Corporate office | 3,600 | 4,000 | 5,334 | 5,235 | |||||||||||
$ | 15,326 | $ | 13,730 | $ | 18,221 | $ | 18,687 | ||||||||
Capital Expenditures | |||||||||||||||
Education | $ | 54,159 | $ | 27,520 | |||||||||||
Television broadcasting | 27,013 | 16,802 | |||||||||||||
Manufacturing | 14,806 | 8,012 | |||||||||||||
Healthcare | 1,741 | 2,987 | |||||||||||||
SocialCode | 113 | 756 | |||||||||||||
Other businesses | 235 | 1,003 | |||||||||||||
Corporate office | — | — | |||||||||||||
$ | 98,067 | $ | 57,080 |
As of | |||||||
(in thousands) | September 30, 2017 | December 31, 2016 | |||||
Identifiable Assets | |||||||
Education | $ | 1,615,116 | $ | 1,479,267 | |||
Television broadcasting | 447,702 | 336,631 | |||||
Other businesses | 918,684 | 796,935 | |||||
Corporate office | 157,550 | 455,209 | |||||
$ | 3,139,052 | $ | 3,068,042 | ||||
Investments in Marketable Equity Securities | 495,599 | 424,229 | |||||
Investments in Affiliates | 122,166 | 58,806 | |||||
Prepaid Pension Cost | 863,098 | 881,593 | |||||
Total Assets | $ | 4,619,915 | $ | 4,432,670 |
As of | |||||||
(in thousands) | September 30, 2019 | December 31, 2018 | |||||
Identifiable Assets | |||||||
Education | $ | 1,925,819 | $ | 1,568,747 | |||
Television broadcasting | 470,915 | 452,853 | |||||
Manufacturing | 577,244 | 593,111 | |||||
Healthcare | 132,068 | 108,596 | |||||
SocialCode | 238,253 | 213,394 | |||||
Other businesses | 333,720 | 20,608 | |||||
Corporate office | 71,501 | 162,971 | |||||
$ | 3,749,520 | $ | 3,120,280 | ||||
Investments in Marketable Equity Securities | 535,564 | 496,390 | |||||
Investments in Affiliates | 163,986 | 143,813 | |||||
Prepaid Pension Cost | 1,038,676 | 1,003,558 | |||||
Total Assets | $ | 5,487,746 | $ | 4,764,041 |
Three Months Ended | Nine Months Ended | Three Months Ended | Nine months ended | |||||||||||||||||||||||||||
September 30 | September 30 | September 30 | September 30 | |||||||||||||||||||||||||||
(in thousands) | 2017 | 2016 | 2017 | 2016 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||
Operating Revenues | ||||||||||||||||||||||||||||||
Kaplan international | $ | 178,169 | $ | 167,668 | $ | 552,505 | $ | 535,553 | ||||||||||||||||||||||
Higher education | $ | 133,459 | $ | 148,602 | $ | 416,973 | $ | 472,131 | 78,712 | 89,269 | 237,780 | 275,080 | ||||||||||||||||||
Test preparation | 72,680 | 78,291 | 212,978 | 224,102 | 64,710 | 67,749 | 191,533 | 195,504 | ||||||||||||||||||||||
Kaplan international | 171,259 | 160,456 | 507,568 | 512,068 | ||||||||||||||||||||||||||
Professional (U.S.) | 33,820 | 34,302 | 110,181 | 98,715 | ||||||||||||||||||||||||||
Kaplan corporate and other | 49 | 47 | 120 | 190 | 2,450 | 143 | 7,121 | 870 | ||||||||||||||||||||||
Intersegment elimination | (642 | ) | (460 | ) | (1,438 | ) | (1,266 | ) | (542 | ) | (530 | ) | (1,584 | ) | (1,617 | ) | ||||||||||||||
$ | 376,805 | $ | 386,936 | $ | 1,136,201 | $ | 1,207,225 | $ | 357,319 | $ | 358,601 | $ | 1,097,536 | $ | 1,104,105 | |||||||||||||||
Income (Loss) from Operations | ||||||||||||||||||||||||||||||
Kaplan international | $ | (14,226 | ) | $ | 8,375 | $ | 35,596 | $ | 52,966 | |||||||||||||||||||||
Higher education | $ | 8,809 | $ | 11,494 | $ | 39,124 | $ | 50,037 | 5,177 | 6,042 | 9,813 | 18,616 | ||||||||||||||||||
Test preparation | 7,330 | 8,588 | 10,207 | 13,314 | 4,959 | 10,572 | 8,794 | 17,213 | ||||||||||||||||||||||
Kaplan international | 5,348 | 1,561 | 29,009 | 22,937 | ||||||||||||||||||||||||||
Professional (U.S.) | 4,939 | 6,768 | 20,943 | 20,863 | ||||||||||||||||||||||||||
Kaplan corporate and other | (8,037 | ) | (5,310 | ) | (22,957 | ) | (22,526 | ) | (8,011 | ) | (9,452 | ) | (30,405 | ) | (27,110 | ) | ||||||||||||||
Intersegment elimination | (59 | ) | — | (36 | ) | (49 | ) | 1 | (43 | ) | (2 | ) | (32 | ) | ||||||||||||||||
$ | 13,391 | $ | 16,333 | $ | 55,347 | $ | 63,713 | $ | (7,161 | ) | $ | 22,262 | $ | 44,739 | $ | 82,516 | ||||||||||||||
Depreciation of Property, Plant and Equipment | ||||||||||||||||||||||||||||||
Kaplan international | $ | 3,600 | $ | 3,759 | $ | 11,198 | $ | 11,497 | ||||||||||||||||||||||
Higher education | $ | 2,768 | $ | 4,157 | $ | 9,448 | $ | 12,325 | 840 | 915 | 2,066 | 4,047 | ||||||||||||||||||
Test preparation | 1,407 | 1,441 | 4,080 | 4,837 | 774 | 1,033 | 2,358 | 2,984 | ||||||||||||||||||||||
Kaplan international | 3,780 | 4,360 | 11,071 | 13,739 | ||||||||||||||||||||||||||
Professional (U.S.) | 978 | 859 | 2,802 | 2,171 | ||||||||||||||||||||||||||
Kaplan corporate and other | 130 | 19 | 395 | 421 | 66 | 119 | 172 | 431 | ||||||||||||||||||||||
$ | 8,085 | $ | 9,977 | $ | 24,994 | $ | 31,322 | $ | 6,258 | $ | 6,685 | $ | 18,596 | $ | 21,130 | |||||||||||||||
Amortization of Intangible Assets | $ | 1,355 | $ | 1,773 | $ | 3,798 | $ | 5,158 | $ | 3,944 | $ | 2,682 | $ | 10,888 | $ | 5,494 | ||||||||||||||
Pension Expense | ||||||||||||||||||||||||||||||
Impairment of Long-lived Assets | $ | — | $ | — | $ | 693 | $ | — | ||||||||||||||||||||||
Pension Service Cost | ||||||||||||||||||||||||||||||
Kaplan international | $ | 114 | $ | 66 | $ | 341 | $ | 233 | ||||||||||||||||||||||
Higher education | $ | 548 | $ | 1,905 | $ | 4,636 | $ | 5,715 | 1,136 | 1,050 | 3,401 | 3,260 | ||||||||||||||||||
Test preparation | 244 | 768 | 2,066 | 2,304 | 847 | 577 | 2,534 | 2,035 | ||||||||||||||||||||||
Kaplan international | 24 | 67 | 198 | 201 | ||||||||||||||||||||||||||
Professional (U.S.) | 340 | 291 | 1,017 | 871 | ||||||||||||||||||||||||||
Kaplan corporate and other | 1,614 | 98 | 389 | 745 | 166 | 123 | 496 | 250 | ||||||||||||||||||||||
$ | 2,430 | $ | 2,838 | $ | 7,289 | $ | 8,965 | $ | 2,603 | $ | 2,107 | $ | 7,789 | $ | 6,649 |
As of | |||||||
(in thousands) | September 30, 2019 | December 31, 2018 | |||||
Identifiable assets | |||||||
Kaplan international | $ | 1,336,238 | $ | 1,101,040 | |||
Higher education | 202,553 | 126,752 | |||||
Test preparation | 165,471 | 145,308 | |||||
Professional (U.S.) | 154,568 | 166,916 | |||||
Kaplan corporate and other | 66,989 | 28,731 | |||||
$ | 1,925,819 | $ | 1,568,747 |
As of | |||||||
(in thousands) | September 30, 2017 | December 31, 2016 | |||||
Identifiable assets | |||||||
Higher education | $ | 349,756 | $ | 373,127 | |||
Test preparation | 135,442 | 133,709 | |||||
Kaplan international | 1,110,596 | 950,922 | |||||
Kaplan corporate and other | 19,322 | 21,509 | |||||
$ | 1,615,116 | $ | 1,479,267 |
• | a $20.4 million provision recorded at Kaplan International related to a Value Added Tax (VAT) receivable at UK Pathways (after-tax impact of $16.5 million, or $3.09 per share); |
• | non-operating gain of $3.7 million from write-ups of cost method investments (after-tax impact of $2.8 million or $0.51 per share); and |
• | $0.7 million in non-operating foreign currency gains (after-tax impact of $0.5 million, or $0.09 per share). |
• | a $7.9 million intangible asset impairment charge at the healthcare business (after-tax impact of $5.8 million, or $1.08 per share); |
• | a $1.0 million reduction to operating expenses from property, plant and equipment gains in connection with the spectrum repacking mandate of the FCC (after-tax impact of $0.8 million, or $0.14 per share); |
• | $45.0 million in net gains on marketable equity securities (after-tax impact of $33.6 million, or $6.26 per share); |
• | non-operating gain, net, of $10.1 million from sales, write-ups and impairments of cost method and equity method investments, and related to sales of businesses (after-tax impact of $8.0 million, or $1.48 per share); |
• | $0.1 million in non-operating foreign currency losses (after-tax impact of $0.1 million, or $0.02 per share); and |
• | a nonrecurring discrete $17.8 million deferred state tax benefit related to the release of valuation allowances ($3.31 per share). |
• | a $17.1 million provision recorded at Kaplan International related to a VAT receivable at UK Pathways (after-tax impact of $13.9 million, or $2.59 per share); |
• | $6.6 million in expenses related to a second quarter non-operating Separation Incentive Program (SIP) at the education division (after-tax impact of $5.1 million, or $0.95 per share); |
• | $49.3 million in net gains on marketable equity securities (after-tax impact of $36.9 million, or $6.90 per share); |
• | non-operating gain of $5.1 million from write-ups of cost method investments (after-tax impact of $3.9 million or $0.73 per share); |
• | $29.0 million gain from the sale of Gimlet Media (after-tax impact of $21.7 million, or $4.06 per share); |
• | $1.3 million in non-operating foreign currency gains (after-tax impact of $1.0 million, or $0.18 per share); and |
• | $1.7 million in income tax benefits related to stock compensation ($0.32 per share). |
• | a $7.9 million intangible asset impairment charge at the healthcare business (after-tax impact of $5.8 million, or $1.08 per share); |
• | a $2.1 million reduction to operating expenses from property, plant and equipment gains in connection with the spectrum repacking mandate of the FCC (after-tax impact of $1.6 million, or $0.29 per share); |
• | $6.2 million in interest expense related to the settlement of a mandatorily redeemable noncontrolling interest ($1.14 per share); |
• | $28.3 million in net losses on marketable equity securities (after-tax impact of $20.9 million, or $3.86 per share); |
• | non-operating gain, net, of $17.0 million from sales, write-ups and impairments of cost method and equity method investments, and related to sales of land and businesses (after-tax impact of $13.4 million, or $2.46 per share); |
• | $2.2 million in non-operating foreign currency losses (after-tax impact of $1.7 million, or $0.31 per share); |
• | a nonrecurring discrete $17.8 million deferred state tax benefit related to the release of valuation allowances ($3.31 per share); and |
• | $1.8 million in income tax benefits related to stock compensation ($0.33 per share). |
Three Months Ended | Nine Months Ended | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||||
September 30 | September 30 | September 30 | September 30 | |||||||||||||||||||||||||||||||||||||||
(in thousands) | 2017 | 2016 | % Change | 2017 | 2016 | % Change | 2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||||||||||||||||
Revenue | ||||||||||||||||||||||||||||||||||||||||||
Kaplan international | $ | 178,169 | $ | 167,668 | 6 | $ | 552,505 | $ | 535,553 | 3 | ||||||||||||||||||||||||||||||||
Higher education | $ | 133,459 | $ | 148,602 | (10 | ) | $ | 416,973 | $ | 472,131 | (12 | ) | 78,712 | 89,269 | (12 | ) | 237,780 | 275,080 | (14 | ) | ||||||||||||||||||||||
Test preparation | 72,680 | 78,291 | (7 | ) | 212,978 | 224,102 | (5 | ) | 64,710 | 67,749 | (4 | ) | 191,533 | 195,504 | (2 | ) | ||||||||||||||||||||||||||
Kaplan international | 171,259 | 160,456 | 7 | 507,568 | 512,068 | (1 | ) | |||||||||||||||||||||||||||||||||||
Professional (U.S.) | 33,820 | 34,302 | (1 | ) | 110,181 | 98,715 | 12 | |||||||||||||||||||||||||||||||||||
Kaplan corporate and other | 49 | 47 | 4 | 120 | 190 | (37 | ) | 2,450 | 143 | — | 7,121 | 870 | — | |||||||||||||||||||||||||||||
Intersegment elimination | (642 | ) | (460 | ) | — | (1,438 | ) | (1,266 | ) | — | (542 | ) | (530 | ) | — | (1,584 | ) | (1,617 | ) | — | ||||||||||||||||||||||
$ | 376,805 | $ | 386,936 | (3 | ) | $ | 1,136,201 | $ | 1,207,225 | (6 | ) | $ | 357,319 | $ | 358,601 | 0 | $ | 1,097,536 | $ | 1,104,105 | (1 | ) | ||||||||||||||||||||
Operating Income (Loss) | ||||||||||||||||||||||||||||||||||||||||||
Kaplan international | $ | (14,226 | ) | $ | 8,375 | — | $ | 35,596 | $ | 52,966 | (33 | ) | ||||||||||||||||||||||||||||||
Higher education | $ | 8,809 | $ | 11,494 | (23 | ) | $ | 39,124 | $ | 50,037 | (22 | ) | 5,177 | 6,042 | (14 | ) | 9,813 | 18,616 | (47 | ) | ||||||||||||||||||||||
Test preparation | 7,330 | 8,588 | (15 | ) | 10,207 | 13,314 | (23 | ) | 4,959 | 10,572 | (53 | ) | 8,794 | 17,213 | (49 | ) | ||||||||||||||||||||||||||
Kaplan international | 5,348 | 1,561 | — | 29,009 | 22,937 | 26 | ||||||||||||||||||||||||||||||||||||
Professional (U.S.) | 4,939 | 6,768 | (27 | ) | 20,943 | 20,863 | 0 | |||||||||||||||||||||||||||||||||||
Kaplan corporate and other | (6,682 | ) | (3,537 | ) | (89 | ) | (19,159 | ) | (17,368 | ) | (10 | ) | (4,067 | ) | (6,770 | ) | 40 | (18,824 | ) | (21,616 | ) | 13 | ||||||||||||||||||||
Amortization of intangible assets | (1,355 | ) | (1,773 | ) | 24 | (3,798 | ) | (5,158 | ) | 26 | (3,944 | ) | (2,682 | ) | (47 | ) | (10,888 | ) | (5,494 | ) | (98 | ) | ||||||||||||||||||||
Impairment of long-lived assets | — | — | — | (693 | ) | — | — | |||||||||||||||||||||||||||||||||||
Intersegment elimination | (59 | ) | — | — | (36 | ) | (49 | ) | — | 1 | (43 | ) | — | (2 | ) | (32 | ) | — | ||||||||||||||||||||||||
$ | 13,391 | $ | 16,333 | (18 | ) | $ | 55,347 | $ | 63,713 | (13 | ) | $ | (7,161 | ) | $ | 22,262 | — | $ | 44,739 | $ | 82,516 | (46 | ) |
As of September 30 | ||||||
2017 | 2016 | |||||
Certificate | 10.0 | % | 7.7 | % | ||
Associate’s | 16.8 | % | 19.5 | % | ||
Bachelor’s | 50.1 | % | 51.0 | % | ||
Master’s | 23.1 | % | 21.8 | % | ||
100.0 | % | 100.0 | % |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30 | September 30 | ||||||||||||||||||||
(in thousands) | 2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||||||||||||
Revenue | $ | 115,161 | $ | 130,014 | (11 | ) | $ | 340,012 | $ | 352,902 | (4 | ) | |||||||||
Operating Income | 36,813 | 55,453 | (34 | ) | 116,847 | 137,113 | (15 | ) |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||
September 30 | % | September 30 | % | |||||||||||||||||||
(in thousands) | 2017 | 2016 | Change | 2017 | 2016 | Change | ||||||||||||||||
Operating Revenues | ||||||||||||||||||||||
Manufacturing | $ | 115,594 | $ | 62,207 | 86 | $ | 298,164 | $ | 176,908 | 69 | ||||||||||||
Healthcare | 40,473 | 37,690 | 7 | 115,592 | 110,068 | 5 | ||||||||||||||||
SocialCode | 14,497 | 15,180 | (4 | ) | 41,926 | 38,961 | 8 | |||||||||||||||
Other | 8,561 | 7,236 | 18 | 25,253 | 18,361 | 38 | ||||||||||||||||
$ | 179,125 | $ | 122,313 | 46 | $ | 480,935 | $ | 344,298 | 40 | |||||||||||||
Operating Expenses | ||||||||||||||||||||||
Manufacturing | $ | 109,813 | $ | 58,430 | 88 | $ | 292,893 | $ | 169,145 | 73 | ||||||||||||
Healthcare | 39,553 | 36,383 | 9 | 115,214 | 107,288 | 7 | ||||||||||||||||
SocialCode | 20,745 | 26,017 | (20 | ) | 50,078 | 54,223 | (8 | ) | ||||||||||||||
Other | 16,047 | 12,284 | 31 | 49,265 | 35,235 | 40 | ||||||||||||||||
$ | 186,158 | $ | 133,114 | 40 | $ | 507,450 | $ | 365,891 | 39 | |||||||||||||
Operating Income (Loss) | ||||||||||||||||||||||
Manufacturing | $ | 5,781 | $ | 3,777 | 53 | $ | 5,271 | $ | 7,763 | (32 | ) | |||||||||||
Healthcare | 920 | 1,307 | (30 | ) | 378 | 2,780 | (86 | ) | ||||||||||||||
SocialCode | (6,248 | ) | (10,837 | ) | 42 | (8,152 | ) | (15,262 | ) | 47 | ||||||||||||
Other | (7,486 | ) | (5,048 | ) | (48 | ) | (24,012 | ) | (16,874 | ) | (42 | ) | ||||||||||
$ | (7,033 | ) | $ | (10,801 | ) | 35 | $ | (26,515 | ) | $ | (21,593 | ) | (23 | ) | ||||||||
Depreciation | ||||||||||||||||||||||
Manufacturing | $ | 2,717 | $ | 1,809 | 50 | $ | 6,629 | $ | 5,588 | 19 | ||||||||||||
Healthcare | 1,166 | 686 | 70 | 3,429 | 2,090 | 64 | ||||||||||||||||
SocialCode | 256 | 241 | 6 | 753 | 683 | 10 | ||||||||||||||||
Other | 381 | 553 | (31 | ) | 1,157 | 1,028 | 13 | |||||||||||||||
$ | 4,520 | $ | 3,289 | 37 | $ | 11,968 | $ | 9,389 | 27 | |||||||||||||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | ||||||||||||||||||||||
Manufacturing | $ | 6,306 | $ | 3,089 | — | $ | 25,117 | $ | 8,722 | — | ||||||||||||
Healthcare | 2,420 | 1,674 | 45 | 5,718 | 5,028 | 14 | ||||||||||||||||
SocialCode | 83 | — | — | 250 | — | — | ||||||||||||||||
Other | — | 21 | — | — | 63 | — | ||||||||||||||||
$ | 8,809 | $ | 4,784 | 84 | $ | 31,085 | $ | 13,813 | — | |||||||||||||
Pension Expense | ||||||||||||||||||||||
Manufacturing | $ | 947 | $ | 24 | — | $ | 994 | $ | 62 | — | ||||||||||||
Healthcare | 166 | — | — | 498 | — | — | ||||||||||||||||
SocialCode | 149 | 135 | 10 | 445 | 406 | 10 | ||||||||||||||||
Other | 113 | 120 | (6 | ) | 336 | 371 | (9 | ) | ||||||||||||||
$ | 1,375 | $ | 279 | — | $ | 2,273 | $ | 839 | — |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30 | September 30 | ||||||||||||||||||||
(in thousands) | 2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||||||||||||
Revenue | $ | 111,676 | $ | 126,028 | (11 | ) | $ | 341,706 | $ | 369,896 | (8 | ) | |||||||||
Operating Income | 6,845 | 5,146 | 33 | 14,811 | 22,439 | (34 | ) |
Three Months Ended | Nine Months Ended | ||||||||||||||||||
September 30 | September 30 | ||||||||||||||||||
(in thousands) | 2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||||||||||
Revenue | $ | 40,688 | $ | 35,486 | 15 | $ | 119,057 | $ | 111,315 | 7 | |||||||||
Operating Income (Loss) | 1,208 | (8,702 | ) | — | 6,135 | (9,329 | ) | — |
Three Months Ended | Nine Months Ended | ||||||||||||||||||
September 30 | September 30 | ||||||||||||||||||
(in thousands) | 2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||||||||||
Revenue | $ | 15,975 | $ | 13,781 | 16 | $ | 45,804 | $ | 41,850 | 9 | |||||||||
Operating Income (Loss) | (378 | ) | 5,124 | — | (5,371 | ) | (399 | ) | — |
Moody’s | Standard & Poor’s | ||
Long-term | Ba1 | BB+ |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plan* | Maximum Number of Shares that May Yet Be Purchased Under the Plan* | |||||||||
July | — | $ | — | — | 223,526 | ||||||||
August | 41,258 | 586.17 | 41,258 | 182,268 | |||||||||
September | 19,031 | 568.28 | 19,031 | 163,237 | |||||||||
60,289 | $ | 580.52 | 60,289 |
Exhibit Number | Description |
3.1 | |
3.2 | |
3.3 | |
4.1 | |
4.2 | |
10.1 | |
31.1 | |
31.2 | |
32 | |
101.SCH | Inline XBRL Taxonomy Extension Schema Document |
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
* |
GRAHAM HOLDINGS COMPANY | ||
(Registrant) | ||
Date: | /s/ Timothy J. O’Shaughnessy | |
Timothy J. O’Shaughnessy, President & Chief Executive Officer (Principal Executive Officer) | ||
Date: | /s/ Wallace R. Cooney | |
Wallace R. Cooney, (Principal Financial Officer) |