Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Oct. 28, 2016 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ghc | |
Entity Registrant Name | GRAHAM HOLDINGS CO | |
Entity Central Index Key | 104,889 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Class A Common Stock [Member] | ||
Entity Common Stock, Shares Outstanding | 964,001 | |
Class B Common Stock [Member] | ||
Entity Common Stock, Shares Outstanding | 4,649,554 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Operating Revenues [Abstract] | ||||
Education | $ 386,936 | $ 481,687 | $ 1,207,086 | $ 1,505,914 |
Advertising | 86,531 | 68,898 | 225,590 | 205,489 |
Other | 148,171 | 90,847 | 419,635 | 258,344 |
Total Operating Revenues | 621,638 | 641,432 | 1,852,311 | 1,969,747 |
Operating Costs and Expenses [Abstract] | ||||
Operating | 293,194 | 302,029 | 880,859 | 922,373 |
Selling, general and administrative | 237,694 | 285,563 | 709,344 | 864,380 |
Depreciation of property, plant and equipment | 16,097 | 14,460 | 48,903 | 62,266 |
Amortization of intangible assets | 6,620 | 4,512 | 19,160 | 13,897 |
Asset Impairment Charges | 0 | 248,591 | 0 | 255,467 |
Total Operating Costs and Expenses | 553,605 | 855,155 | 1,658,266 | 2,118,383 |
Income (loss) from Operations | 68,033 | (213,723) | 194,045 | (148,636) |
Equity in (losses) earnings of affiliates, net | (1,008) | 95 | (895) | (662) |
Interest income | 740 | 481 | 2,052 | 1,363 |
Interest expense | (8,614) | (7,830) | (24,533) | (24,679) |
Other (expense) income, net | (18,225) | (40,458) | 15,871 | (29,885) |
Income (loss) from Continuing Operations Before Income Taxes | 40,926 | (261,435) | 186,540 | (202,499) |
Provision (Benefit) for Income Taxes | 7,800 | (30,500) | 54,000 | (10,000) |
Income (loss) from Continuing Operations | 33,126 | (230,935) | 132,540 | (192,499) |
Income from Discontinued Operations, Net of Tax | 0 | 379 | 0 | 42,170 |
Net Income (loss) | 33,126 | (230,556) | 132,540 | (150,329) |
Net Income Attributable to Noncontrolling Interests | 0 | (287) | (868) | (1,495) |
Net Income (loss) Attributable to Graham Holdings Company | 33,126 | (230,843) | 131,672 | (151,824) |
Redeemable Preferred Stock Dividends | 0 | 0 | 0 | (631) |
Net Income (loss) Attributable to Graham Holdings Company Common Stockholders | 33,126 | (230,843) | 131,672 | (152,455) |
Amounts Attributable to Graham Holdings Company Common Stockholders | ||||
Income (loss) from continuing operations | 33,126 | (231,222) | 131,672 | (194,625) |
Income from discontinued operations, net of tax | 0 | 379 | 0 | 42,170 |
Net Income (loss) Attributable to Graham Holdings Company Common Stockholders | $ 33,126 | $ (230,843) | $ 131,672 | $ (152,455) |
Per Share Information Attributable to Graham Holdings Company Common Stockholders | ||||
Basic income (loss) per common share from continuing operations in dollars per share | $ 5.90 | $ (40.32) | $ 23.33 | $ (34.18) |
Basic income per common share from discontinued operations in dollars per share | 0 | 0.07 | 0 | 7.99 |
Basic net income (loss) per common share in dollars per share | $ 5.90 | $ (40.25) | $ 23.33 | $ (26.19) |
Basic average number of common shares outstanding in shares | 5,544 | 5,738 | 5,570 | 5,721 |
Diluted income (loss) per common share from continuing operations in dollars per share | $ 5.87 | $ (40.32) | $ 23.21 | $ (34.18) |
Diluted income per common share from discontinued operations in dollars per share | 0 | 0.07 | 0 | 7.99 |
Diluted net income (loss) per common share in dollars per share | $ 5.87 | $ (40.25) | $ 23.21 | $ (26.19) |
Diluted average number of common shares outstanding in shares | 5,574 | 5,837 | 5,600 | 5,811 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income (Loss) | $ 33,126 | $ (230,556) | $ 132,540 | $ (150,329) |
Foreign currency translation adjustments: | ||||
Translation adjustments arising during the period | (353) | (10,548) | (1,629) | (17,387) |
Adjustment for sales of businesses with foreign operations | 0 | 6,026 | 0 | 5,501 |
Total foreign currency translation adjustments, before tax | (353) | (4,522) | (1,629) | (11,886) |
Unrealized gains (losses) on available-for-sale securities: | ||||
Unrealized gains (losses) for the period, net | 12,154 | 3,836 | 7,190 | (16,497) |
Reclassification of realized gain on sale of available-for-sale securities included in net income | 0 | 0 | (6,256) | 0 |
Total unrealized gains (losses) on available-for-sale securities, before tax | 12,154 | 3,836 | 934 | (16,497) |
Pension and other postretirement plans: | ||||
Amortization of net prior service cost included in net income | 105 | 68 | 314 | 207 |
Amortization of net actuarial loss (gain) included in net income | 289 | (5,676) | 868 | (4,419) |
Curtaliment gains included in net income | 0 | 51 | 0 | 51 |
Curtailment and settlement included in distribution to Cable ONE | 0 | 1,403 | 0 | 1,403 |
Total pension and other postretirement plans, before tax | 394 | (4,154) | 1,182 | (2,758) |
Cash flow hedge gain | 49 | 0 | 49 | 179 |
Other Comprehensive Income (Loss), Before Tax | 12,244 | (4,840) | 536 | (30,962) |
Income tax (expense) benefit related to items of other comprehensive income (loss) | (5,039) | 127 | (866) | 7,632 |
Other Comprehensive Income (Loss), Net of Tax | 7,205 | (4,713) | (330) | (23,330) |
Comprehensive Income (Loss) | 40,331 | (235,269) | 132,210 | (173,659) |
Comprehensive income attributable to noncontrolling interests | 0 | (287) | (868) | (1,495) |
Total Comprehensive Income (Loss) Attributable to Graham Holdings Company | $ 40,331 | $ (235,556) | $ 131,342 | $ (175,154) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Current Assets | ||
Cash and cash equivalents | $ 593,183 | $ 754,207 |
Restricted cash | 28,011 | 20,745 |
Investments in marketable equity securities and other investments | 408,670 | 379,445 |
Accounts receivable, net | 567,348 | 572,435 |
Income taxes receivable | 19,920 | 48,383 |
Inventories and contracts in progress | 35,283 | 32,068 |
Other current assets | 63,162 | 53,439 |
Total Current Assets | 1,715,577 | 1,860,722 |
Property, Plant and Equipment, Net | 225,673 | 231,123 |
Investments in Affiliates | 64,815 | 59,229 |
Goodwill, Net | 1,150,446 | 1,017,513 |
Indefinite-Lived Intangible Assets, Net | 68,780 | 21,885 |
Amortized Intangible Assets, Net | 114,636 | 107,191 |
Prepaid Pension Cost | 1,016,908 | 979,970 |
Deferred Charges and Other Assets | 81,810 | 75,192 |
Total Assets | 4,438,645 | 4,352,825 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 406,185 | 428,014 |
Deferred revenue | 334,577 | 297,135 |
Current portion of long-term debt | 6,498 | 0 |
Dividends declared | 6,797 | 0 |
Total Current Liabilities | 754,057 | 725,149 |
Postretirement Benefits Other Than Pensions | 35,267 | 33,947 |
Accrued Compensation and Related Benefits | 194,693 | 203,280 |
Other Liabilities | 67,458 | 70,678 |
Deferred Income Taxes | 377,564 | 403,316 |
Mandatorily Redeemable Noncontrolling Interest | 9,847 | 0 |
Long-Term Debt | 490,910 | 399,800 |
Total Liabilities | 1,929,796 | 1,836,170 |
Redeemable Noncontrolling Interest | 50 | 25,957 |
Preferred Stock | 0 | 0 |
Common Stockholders’ Equity | ||
Common stock | 20,000 | 20,000 |
Capital in excess of par value | 360,515 | 356,887 |
Retained earnings | 5,552,019 | 5,447,677 |
Accumulated other comprehensive income (loss), net of tax | ||
Cumulative foreign currency translation adjustment | (6,478) | (4,849) |
Unrealized gain on available-for-sale securities | 59,060 | 58,500 |
Unrealized gain on pensions and other postretirement plans | 261,739 | 261,029 |
Cash Flow Hedge | 29 | 0 |
Cost of Class B common stock held in treasury | (3,738,085) | (3,648,546) |
Total Equity | 2,508,799 | 2,490,698 |
Total Liabilities and Equity | $ 4,438,645 | $ 4,352,825 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Cash Flows from Operating Activities | ||
Net Income (Loss) | $ 132,540 | $ (150,329) |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, amortization and goodwill and other long-lived asset impairment | 68,063 | 403,444 |
Net pension benefit | (36,714) | (45,081) |
Early retirement program expense | 0 | 3,734 |
Stock-based compensation expense, net | 10,319 | 38,423 |
(Gain) loss on disposition of businesses, property, plant and equipment, investments and other assets, net | (62,132) | 19,634 |
Foreign exchange loss | 33,324 | 16,191 |
Write-down of cost method investments | 15,161 | 1,364 |
Gain on sale of equity affiliate | 0 | (4,827) |
Equity in losses of affiliates, net of distributions | 895 | 853 |
Benefit for deferred income taxes | (17,281) | (29,152) |
Net loss on sale of property, plant and equipment | (34,072) | 0 |
Change in assets and liabilities: | ||
Restricted cash | (7,266) | (449) |
Accounts receivable, net | 5,980 | (20,480) |
Accounts payable and accrued liabilities | (38,099) | 74,112 |
Deferred revenue | 28,014 | (11,880) |
Income taxes receivable | 27,206 | (159,490) |
Other assets and other liabilities, net | (16,492) | (21,061) |
Other | 671 | 1,101 |
Net Cash Provided by Operating Activities | 144,189 | 116,107 |
Cash Flows from Investing Activities | ||
Investments in certain businesses, net of cash acquired | (242,472) | 0 |
Net proceeds from sales of businesses, property, plant and equipment, investments and other assets | 36,777 | (807) |
Proceeds from sales of marketable equity securities | 22,837 | 0 |
Purchases of property, plant and equipment | (41,373) | (120,018) |
Purchases of marketable equity securities | (48,265) | (135,124) |
Investments in equity affiliates and cost method investments | (4,550) | (19,038) |
Disbursement of loan to affiliate | (7,730) | 0 |
Other | 0 | 60 |
Net Cash Used in Investing Activities | (284,776) | (274,927) |
Cash Flows from Financing Activities | ||
Issuance of borrowings | 98,610 | 550,000 |
Net cash distributed to Cable ONE in spin-off | 0 | (94,115) |
Common shares repurchased | (90,328) | 0 |
Purchase of noncontrolling interest | (21,000) | 0 |
Dividends paid | (20,532) | (47,006) |
Proceeds from exercise of stock options | 1,200 | 11,308 |
Repayments of borrowings | 0 | (41,815) |
Payments of financing costs | (648) | (9,944) |
Other | 15,408 | 5,334 |
Net Cash Used in Financing Activities | (17,290) | 373,762 |
Effect of Currency Exchange Rate Change | (3,147) | (10,937) |
Net (Decrease) Increase in Cash and Cash Equivalents | (161,024) | 204,005 |
Beginning Cash and Cash Equivalents, Including Cash of Discontinued Operations | 773,986 | |
Beginning Cash and Cash Equivalents | 754,207 | |
Ending Cash and Cash Equivalents | $ 593,183 | $ 977,991 |
Organization, Basis of Presenta
Organization, Basis of Presentation and Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Basis of Presentation and Recent Accounting Pronouncements | ORGANIZATION, BASIS OF PRESENTATION AND RECENT ACCOUNTING PRONOUNCEMENTS Graham Holdings Company (the Company), is a diversified education and media company. The Company’s Kaplan subsidiary provides a wide variety of educational services, both domestically and outside the United States. The Company’s media operations comprise the ownership and operation of five television broadcasting stations. The Company's other business operations include home health and hospice services and manufacturing. Basis of Presentation – The accompanying condensed consolidated financial statements have been prepared in accordance with: (i) generally accepted accounting principles in the United States of America (GAAP) for interim financial information; (ii) the instructions to Form 10-Q; and (iii) the guidance of Rule 10-01 of Regulation S-X under the Securities and Exchange Act of 1934, as amended, for financial statements required to be filed with the Securities and Exchange Commission (SEC). They include the assets, liabilities, results of operations and cash flows of the Company, including its domestic and foreign subsidiaries that are more than 50% owned or otherwise controlled by the Company. As permitted under such rules, certain notes and other financial information normally required by GAAP have been condensed or omitted. Management believes the accompanying condensed consolidated financial statements reflect all normal and recurring adjustments necessary for a fair statement of the Company’s financial position, results of operations, and cash flows as of and for the periods presented herein. The Company’s results of operations for the three and nine months ended September 30, 2016 and 2015 may not be indicative of the Company’s future results. These condensed consolidated financial statements are unaudited and should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 . The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. Certain amounts in previously issued financial statements have been reclassified to conform to the current year presentation, which includes the reclassification of the results of operations of certain businesses as discontinued operations for all periods presented. Out of Period Adjustment – In the second quarter of 2016, the Company benefited from a favorable $5.6 million out of period adjustment to the provision for deferred income taxes related to the $248.6 million goodwill impairment at the KHE reporting unit in the third quarter of 2015. With respect to this error, the Company has concluded that it was not material to the Company’s financial position or results of operations for 2016 and 2015 and the related interim periods, based on its consideration of quantitative and qualitative factors. Use of Estimates in the Preparation of the Condensed Consolidated Financial Statements – The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect the amounts reported herein. Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in those estimates. Recently Adopted and Issued Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (FASB) issued comprehensive new guidance that supersedes all existing revenue recognition guidance. In August 2015, the FASB issued an amendment to the guidance that defers the effective date by one year. The new guidance requires revenue to be recognized when the Company transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The new guidance also significantly expands the disclosure requirements for revenue recognition. The guidance is effective for interim and fiscal years beginning after December 15, 2017. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016. The standard permits two implementation approaches, one requiring retrospective application of the new guidance with a restatement of prior years and one requiring prospective application of the new guidance with disclosure of results under the old guidance. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements and believes such evaluation will extend over several future periods because of the significance of the changes to the Company’s policies and business processes. In August 2014, the FASB issued new guidance that requires management to assess the Company’s ability to continue as a going concern and to provide related disclosures in certain circumstances. This guidance is effective for interim and fiscal years ending after December 15, 2016, with early adoption permitted. The Company does not expect this guidance to have an impact on its Condensed Consolidated Financial Statements. In April 2015, the FASB issued new guidance that simplifies the presentation of debt issuance costs. The new guidance requires that debt issuance costs be reported in the balance sheet as a direct deduction from the gross amount of debt instead of classified as a deferred asset. The guidance is effective for interim and fiscal years beginning after December 15, 2015. The Company adopted the new guidance retrospectively as of January 1, 2016. Therefore, prior periods have been adjusted to reflect this guidance which resulted in the reclassification of $0.1 million of unamortized debt issuance costs related to the Company's 7.25% unsecured notes from deferred charges and other assets to long-term debt within its Condensed Consolidated Balance Sheet as of December 31, 2015. In January 2016, the FASB issued new guidance that substantially revises the recognition, measurement and presentation of financial assets and financial liabilities. The new guidance, among other things, requires, (i) equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, with some exceptions, (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, (iii) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (iv) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements, and (v) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The guidance is effective for interim and fiscal years beginning after December 15, 2017. Early adoption is not permitted. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements. In February 2016, the FASB issued new guidance that requires, among other things, a lessee to recognize a right-of-use asset representing an entity's right to use the underlying asset for the lease term and a liability for lease payments on its balance sheet, regardless of classification of a lease as operating or financing. For leases with a term of twelve months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and liabilities and account for the lease similar to existing guidance for operating leases today. This new guidance supersedes all prior guidance. The guidance is effective for interim and fiscal years beginning after December 15, 2018. Early adoption is permitted. The standard requires lessees and lessors to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements. In March 2016, the FASB issued new guidance that simplifies the accounting for stock-based compensation. The new guidance (i) requires all excess tax benefits and tax deficiencies to be recognized in the income statement with the tax effects of vested or exercised awards treated as discrete items. Additionally, excess tax benefits will be recognized regardless of whether the benefit reduces taxes payable in the current period, effectively eliminating the APIC pool, (ii) concludes excess tax benefits should be classified as an operating activity in the statement of cash flows, (iii) requires an entity to make an entity-wide accounting policy election to either estimate a forfeiture rate for awards or account for forfeitures as they occur, (iv) changes the threshold for equity classification for cash settlements of awards for withholding requirements to the maximum statutory tax rate in the applicable jurisdiction and (v) concludes cash paid by an employer when directly withholding shares for tax-withholding purposes should be classified as a financing activity in the statement of cash flows. The guidance is effective for interim and fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | DISCONTINUED OPERATIONS Cable ONE Spin-Off. On July 1, 2015 (the “Distribution Date”), the Company completed the spin-off of Cable One, Inc. (Cable ONE) as an independent, publicly traded company. The transaction was structured as a tax-free spin-off of Cable ONE to the stockholders of the Company as one share of Cable ONE common stock was distributed for every share of Class A and Class B common stock of Graham Holdings outstanding on the June 15, 2015, record date. Cable ONE is now an independent public company trading on the New York Stock Exchange under the symbol “CABO”. After the spin, the Company does not beneficially own any shares of Cable ONE common stock. The results of operations of Cable ONE are included in the Company’s Condensed Consolidated Statements of Operations as income from discontinued operations, net of tax, for 2015. The Company did not reclassify its Statements of Cash Flows to reflect the various discontinued operations. Cash flows from Cable ONE for the three and nine months ended September 30, 2015 are combined with the cash flows from operations within each of the categories presented. Cash flows from Cable ONE are as follows: Three Months Ended Nine Months Ended (in thousands) September 30, 2015 September 30, 2015 Net Cash (Used in) Provided by Operating Activities $ (4,468 ) $ 111,665 Net Cash Used in Investing Activities — (74,416 ) Spin-Off Costs: One-time Spin-Off transaction and financing and related costs of $7.4 million in 2015 are included in discontinued operations, net of tax. Other Discontinued Operations. In the third quarter of 2014, Kaplan completed the sale of three of its schools in China that were previously included as part of Kaplan International. An additional school in China was sold by Kaplan in January of 2015 that resulted in a pre-tax loss of $0.7 million . The results of operations of the schools in China are included in the Company’s Condensed Consolidated Statements of Operations as income from discontinued operations, net of tax, for 2015. The summarized income from discontinued operations, net of tax, is presented below: Three Months Ended Nine Months Ended (in thousands) September 30, 2015 September 30, 2015 Operating revenues $ — $ 397,404 Operating costs and expenses 1,662 (325,379 ) Operating income 1,662 72,025 Non-operating expense — (1,288 ) Income from discontinued operations 1,662 70,737 Provision for income taxes 1,283 27,783 Net Income from Discontinued Operations 379 42,954 Loss on sale of discontinued operations — (732 ) Provision for income taxes on disposition of discontinued operations — 52 Income from Discontinued Operations, Net of Tax $ 379 $ 42,170 |
Investments
Investments | 9 Months Ended |
Sep. 30, 2016 | |
Investments [Abstract] | |
Investments | INVESTMENTS As of September 30, 2016 and December 31, 2015 , the Company had commercial paper and money market investments of $372.2 million and $433.0 million , respectively, that are classified as cash, cash equivalents and restricted cash in the Company's Condensed Consolidated Balance Sheets. Investments in marketable equity securities comprised the following: As of September 30, December 31, (in thousands) Total cost $ 284,343 $ 253,062 Gross unrealized gains 107,145 97,741 Gross unrealized losses (8,711 ) (240 ) Total Fair Value $ 382,777 $ 350,563 The Company settled on $48.3 million of marketable equity securities purchases during the first nine months of 2016 , of which $47.9 million was purchased in the first nine months. There were $135.6 million of new investments in marketable equity securities during the first nine months of 2015 . The total proceeds from the sales of marketable equity securities for the first nine months of 2016 were $22.8 million , with realized gains of $6.3 million . There were no sales of marketable equity securities in the first nine months of 2015 . As of September 30, 2016 , the Company held an approximate 20% interest in HomeHero and interests in several other affiliates; Residential Healthcare (Residential) held a 40% interest in Residential Home Health Illinois, a 42.5% interest in Residential Hospice Illinois and a 40% interest in the joint venture formed between Residential and a Michigan hospital; and Celtic Healthcare (Celtic) held a 40% interest in the joint venture formed between Celtic Healthcare and Allegheny Health Network (AHN) (see Note 4). |
Acquisitions and Dispositions o
Acquisitions and Dispositions of Businesses | 9 Months Ended |
Sep. 30, 2016 | |
Acqusitions and Dispositions [Abstract] | |
Acquisitions and Dispositions of Businesses | ACQUISITIONS AND DISPOSITIONS OF BUSINESSES Acquisitions . In May 2016, Graham Media Group entered into an agreement to acquire two television stations for $60 million in cash and the assumption of certain pension obligations. The acquisition is subject to approval by the Federal Communications Commission, other regulatory approvals and the satisfaction of closing conditions. In the first nine months of 2016 , the Company acquired three businesses included in its education division and one business in other businesses totaling $254.8 million . In September 2016, Dekko acquired a 100% interest in Electri-Cable Assemblies (ECA), a Shelton, CT based manufacturer of power, data and electrical solutions for the office furniture industry. This acquisition is included in other businesses. In January and February 2016, Kaplan acquired a 100% interest in Mander Portman Woodward, a leading provider of high-quality, bespoke education to UK and international students in London, Cambridge and Birmingham; and a 100% interest in Osborne Books, an educational publisher of learning resources for accounting qualifications in the UK. These acquisitions are included in Kaplan International. In the first nine months of 2015 , the Company did no t make any acquisitions. On November 13, 2015, the Company acquired a 100% interest in Group Dekko, a Garrett, IN-based manufacturer of electrical solutions for applications across three business lines: workspace power solutions, architectural lighting, and electrical components and assemblies, which is included in other businesses. On December 22, 2015, Kaplan acquired a 100% interest in SmartPros, a provider of accredited professional education and training, primarily in accountancy, which is included in Higher Education. Acquisition-related costs were expensed as incurred and were not significant. The aggregate purchase price of the 2016 acquisitions was allocated as follows on a preliminary basis: Weighted Average Life Purchase Price Allocation (in thousands) Cash and cash equivalents $ 10,587 Accounts receivable 8,415 Inventory 971 Other current assets 1,420 Property, plant and equipment 3,940 Goodwill 181,228 Indefinite-lived intangible assets Trade names and trademarks 53,110 Amortized intangible assets Student and customer relationships 6 years 22,292 Trade names and trademarks 6 years 2,425 Noncompete agreements 2 years 350 Other 7 years 2,200 6 years 27,267 Current liabilities (20,714 ) Noncurrent liabilities (11,378 ) $ 254,846 The fair values recorded were based upon preliminary valuations and the estimates and assumptions used in such valuations are subject to change, which could be significant, within the measurement period (up to one year from the acquisition date). The recording of deferred tax assets or liabilities, and the final amount of residual goodwill are not yet finalized. The Company expects to deduct $20.3 million of goodwill for income tax purposes from these four acquisitions. The acquired companies were consolidated into the Company’s financial statements starting on their respective acquisition dates. The Company’s Condensed Consolidated Statements of Operations include aggregate revenues and operating loss for the companies acquired in 2016 of $6.1 million and $2.2 million , respectively, for the third quarter of 2016 . The revenue and operating income were $31.4 million and $6.7 million , respectively, for the first nine months of 2016 . The following unaudited pro forma financial information presents the Company’s results as if the acquisitions had occurred at the beginning of 2015 . The unaudited pro forma information also includes the 2015 acquisitions as if they occurred at the beginning of 2014: Three Months Ended Nine Months Ended (in thousands) 2016 2015 2016 2015 Operating revenues $ 626,223 $ 696,570 $ 1,869,174 $ 2,147,273 Net income (loss) 32,400 (229,831 ) 135,478 (138,545 ) These pro forma results were based on estimates and assumptions, which the Company believes are reasonable. They are not the results that would have been realized had these entities been part of the Company during the periods presented and are not necessarily indicative of the Company’s consolidated results of operations in future periods. In the third quarter of 2016, the Company recorded adjustments to the deferred taxes included in the preliminary accounting of Dekko and SmartPros acquired in the fourth quarter of 2015. These adjustments resulted in a $20.2 million decrease to goodwill. Spin-Off. On July 1, 2015, the Company completed the spin-off of Cable ONE, by way of a distribution of all the issued and outstanding shares of Cable ONE common stock, on a pro rata basis, to the Company's stockholders (see Note 2). Sale of Businesses. In January 2016, Kaplan completed the sale of Colloquy, which was included in Kaplan Corporate and Other. On September 3, 2015, Kaplan completed the sale of substantially all of the assets of its KHE Campuses business, consisting of 38 nationally accredited ground campuses and certain related assets, in exchange for a preferred equity interest in a vocational school company. KHE Campuses schools that were closed or were in the process of closing were not included in the sale transaction. The revenue and operating losses related to schools that were sold as part of the KHEC Campuses sale are as follows: Three Months Ended Nine Months Ended (in thousands) Revenue $ 43,121 $ 167,244 Operating income (loss) 629 (6,672 ) In the second quarter of 2015, Kaplan also recorded a $6.9 million long-lived assets impairment charge in connection with the KHE Campuses business , of which $4.7 million was an unfavorable out of period expense adjustment related to the first quarter of 2015 (this amount is included in the above table). With respect to this error, the Company has concluded that it was not material to the Company’s financial position or results of operations for the first or second quarter of 2015, based on its consideration of quantitative and qualitative factors. In the third quarter of 2015, Kaplan sold Franklyn Scholar, which was part of Kaplan International. In the second quarter of 2015, the Company sold The Root, a component of Slate, and Kaplan sold two small businesses, Structuralia, which was part of Kaplan International, and Fire and EMS Training, which was part of Kaplan Higher Education. As a result of these sales, the Company reported gains in other non-operating income (see Note 10) . In the third quarter of 2014, Kaplan completed the sale of three of its schools in China that were previously included as part of Kaplan International. In January 2015, Kaplan completed the sale of an additional school in China. Other. In June 2016, Residential and a Michigan hospital formed a joint venture to provide home health services to patients in western Michigan. In connection with this transaction, Residential contributed its western Michigan home health operations to the joint venture and then sold 60% of the newly formed venture to its Michigan hospital partner. Although Residential manages the operations of the joint venture, Residential holds a 40% interest in the joint venture, so the operating results of the joint venture are not consolidated and the pro rata operating results are included in the Company's equity in earnings of affiliates. In June 2016, the Company purchased the outstanding 20% redeemable noncontrolling interest in Residential. At that time, the Company recorded an increase to redeemable noncontrolling interest of $3.4 million , with a corresponding decrease to capital in excess of par value, to reflect the redemption value of the redeemable noncontrolling interest at $24.0 million . Following this transaction, Celtic and Residential combined their business operations to form Graham Healthcare Group (GHG). The redeemable noncontrolling interest shareholders in Celtic exchanged their 20% interest in Celtic for a 10% mandatorily redeemable noncontrolling interest in the combined entity and the Company recorded a $4.1 million net increase to the mandatorily redeemable noncontrolling interest to reflect the estimated fair value of the mandatorily redeemable noncontrolling interest. The minority shareholders have an option to put their shares to the Company starting in 2020, and are required to put a percentage of their shares in 2022 and 2024, with the remaining shares required to be put by the minority shareholders in 2026. The redemption value is based on an EBITDA multiple, adjusted for working capital and other items, computed annually, with no limit on the amount payable. The Company now owns 90% of GHG. Because the noncontrolling interest is now mandatorily redeemable by the Company by 2026, it is reported as a noncurrent liability at September 30, 2016. In January 2015, Celtic and AHN closed on the formation of a joint venture to combine each other’s home health and hospice assets in the western Pennsylvania region. Although Celtic manages the operations of the joint venture, Celtic holds a 40% interest in the joint venture, so the operating results of the joint venture are not consolidated and the pro rata operating results are included in the Company’s equity in earnings of affiliates. The Company’s income from continuing operations excludes Cable ONE and the sold Kaplan China school, which have been reclassified to discontinued operations, net of tax (see Note 2). |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS In the third quarter of 2015, as a result of continued declines in student enrollments at KHE and the challenging industry operating environment, the Company performed an interim impairment review of its goodwill and long-lived assets at the KHE reporting unit. The KHE reporting unit failed the step one goodwill impairment test. As a result of the step two analysis, the Company recorded a $248.6 million goodwill impairment charge. The Company estimated the fair value of the KHE reporting unit utilizing a discounted cash flow model, supported by a market approach. A substantial portion of the impairment charge is due to the amount of unrecognized intangible assets identified in the step two analysis. Amortization of intangible assets for the three months ended September 30, 2016 and 2015 was $6.6 million and $4.5 million , respectively. Amortization of intangible assets for the nine months ended September 30, 2016 and 2015 was $19.2 million and $13.9 million , respectively. Amortization of intangible assets is estimated to be approximately $7 million for the remainder of 2016 , $24 million in 2017 , $22 million in 2018 , $19 million in 2019 , $18 million in 2020 and $25 million thereafter. The changes in the carrying amount of goodwill, by segment, were as follows: (in thousands) Education Television Broadcasting Other Businesses Total Balance as of December 31, 2015 Goodwill $ 1,006,096 $ 168,345 $ 202,814 $ 1,377,255 Accumulated impairment losses (350,850 ) — (8,892 ) (359,742 ) 655,246 168,345 193,922 1,017,513 Measurement period adjustments (2,781 ) — (16,930 ) (19,711 ) Acquisitions 160,894 — 20,334 181,228 Dispositions — — (2,800 ) (2,800 ) Foreign currency exchange rate changes (25,784 ) — — (25,784 ) Balance as of September 30, 2016 Goodwill 1,138,425 168,345 200,608 1,507,378 Accumulated impairment losses (350,850 ) — (6,082 ) (356,932 ) $ 787,575 $ 168,345 $ 194,526 $ 1,150,446 The changes in carrying amount of goodwill at the Company’s education division were as follows: (in thousands) Higher Education Test Preparation Kaplan International Total Balance as of December 31, 2015 Goodwill $ 392,457 $ 166,098 $ 447,541 $ 1,006,096 Accumulated impairment losses (248,591 ) (102,259 ) — (350,850 ) 143,866 63,839 447,541 655,246 Measurement period adjustments (2,781 ) — — (2,781 ) Acquisitions — — 160,894 160,894 Foreign currency exchange rate changes 104 — (25,888 ) (25,784 ) Balance as of September 30, 2016 Goodwill 389,780 166,098 582,547 1,138,425 Accumulated impairment losses (248,591 ) (102,259 ) — (350,850 ) $ 141,189 $ 63,839 $ 582,547 $ 787,575 Other intangible assets consist of the following: As of September 30, 2016 As of December 31, 2015 (in thousands) Useful Life Range Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Accumulated Net Amortized Intangible Assets Student and customer relationships 2–10 years $ 130,264 $ 51,902 $ 78,362 $ 108,806 $ 40,280 $ 68,526 Trade names and trademarks 2–10 years 55,705 27,929 27,776 53,848 23,941 29,907 Databases and technology 3–5 years 4,617 4,304 313 4,617 4,114 503 Noncompete agreements 2–5 years 1,731 1,273 458 1,381 1,012 369 Other 1–8 years (1) 12,031 4,304 7,727 10,095 2,209 7,886 $ 204,348 $ 89,712 $ 114,636 $ 178,747 $ 71,556 $ 107,191 Indefinite-Lived Intangible Assets Trade names and trademarks $ 67,946 $ 21,051 Licensure and accreditation 834 834 $ 68,780 $ 21,885 ____________ (1) The Company's other amortized intangible assets’ maximum useful life was 7 years as of December 31, 2015. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Debt | DEBT The Company’s borrowings consist of the following: As of September 30, December 31, (in thousands) 7.25% unsecured notes due February 1, 2019 (1) $ 398,938 $ 398,596 UK Credit facility (2) 96,984 — Other indebtedness 1,486 1,204 Total Debt $ 497,408 $ 399,800 Less: current portion (6,498 ) — Total Long-Term Debt $ 490,910 $ 399,800 ___________ _ (1) The carrying value is net of $0.1 million of unamortized debt issuance costs as of September 30, 2016 and December 31, 2015 , respectively. (2) The carrying value is net of $0.6 million of unamortized debt issuance costs as of September 30, 2016 . The Company’s other indebtedness at September 30, 2016 is at interest rates from 2% and 6% and matures from 2019 to 2025 . On June 29, 2015, the Company entered into a credit agreement (the Credit Agreement) providing for a U.S. $200 million five-year revolving credit facility (the Facility). The Company may draw on the Facility for general corporate purposes. The Facility will expire on July 1, 2020, unless the Company and the banks agree to extend the term. The Credit Agreement contains terms and conditions, including remedies in the event of a default by the Company, typical of facilities of this type. As of September 30, 2016 , the Company is in compliance with all financial covenants. On July 14, 2016, Kaplan entered into a Facility Agreement (the Kaplan Credit Agreement) among Kaplan International Holdings Limited, as borrower, the lenders party thereto, HSBC BANK PLC as Facility Agent, and other agents party thereto. The Kaplan Credit Agreement provides for a four-year credit facility in an aggregate principal amount of £75.0 million . Borrowings bear interest at a rate per annum of LIBOR plus an applicable interest rate margin between 1.25% and 1.75% , in each case determined on a quarterly basis by reference to a pricing grid based upon the Company's total leverage ratio. The credit facility requires that 6.66% of the outstanding aggregate amount of the loan be repaid on the first three anniversaries of funding, with the remaining balance due on July 1, 2020. On July 25, 2016, Kaplan borrowed £75 million under the Kaplan Credit Agreement. On the same date, Kaplan entered into an interest rate swap agreement with a total notional value of £75 million and a maturity date of July 1, 2020. The interest rate swap agreement will pay Kaplan variable interest on the £75 million notional amount at the three-month LIBOR, and Kaplan will pay the counterparties a fixed rate of 0.51% , effectively resulting in a total fixed interest rate of 2.01% on the outstanding borrowings at the current applicable margin of 1.50% . The interest rate swap agreement was entered into to convert the variable rate British pound borrowing under the Kaplan Credit Agreement into a fixed rate borrowing. The Company provided a guarantee on any borrowings under the Kaplan Credit Agreement. Based on the terms of the interest rate swap agreement and the underlying borrowing, the interest rate swap agreement was determined to be effective, and thus qualifies as a cash flow hedge. As such, changes in the fair value of the interest rate swap are recorded in other comprehensive income on the accompanying Condensed Consolidated Balance Sheets until earnings are affected by the variability of cash flows. During the three months ended September 30, 2016 and 2015 , the Company had average borrowings outstanding of approximately $473.7 million and $404.1 million , respectively, at average annual interest rates of approximately 6.2% and 7.2% , respectively. During the three months ended September 30, 2016 and 2015 , the Company incurred net interest expense of $7.9 million and $7.3 million , respectively. During the nine months ended September 30, 2016 and 2015 , the Company had average borrowings outstanding of approximately $429.4 million and $435.8 million , respectively, at average annual interest rates of approximately 6.9% and 7.0% , respectively. During the nine months ended September 30, 2016 and 2015 , the Company incurred net interest expense of $22.5 million and $23.3 million , respectively. At September 30, 2016 , the fair value of the Company’s 7.25% unsecured notes, based on quoted market prices (Level 2 fair value assessment), totaled $436.3 million , compared with the carrying amount of $398.9 million . At December 31, 2015 , the fair value of the Company’s 7.25% unsecured notes, based on quoted market prices (Level 2 fair value assessment), totaled $436.6 million , compared with the carrying amount of $398.6 million . The carrying value of the Company’s other unsecured debt at September 30, 2016 approximates fair value. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS The Company’s financial assets and liabilities measured at fair value on a recurring basis were as follows: As of September 30, 2016 (in thousands) Level 1 Level 2 Level 3 Total Assets Money market investments (1) $ — $ 281,386 $ — $ 281,386 Commercial paper (2) 90,835 — — 90,835 Marketable equity securities (3) 382,777 — — 382,777 Other current investments (4) 9,746 16,147 — 25,893 Interest rate swap (5) — 51 — 51 Total Financial Assets $ 483,358 $ 297,584 $ — $ 780,942 Liabilities Deferred compensation plan liabilities (6) $ — $ 45,431 $ — $ 45,431 Mandatorily redeemable noncontrolling interest (7) — — 9,847 9,847 Total Financial Liabilities $ — $ 45,431 $ 9,847 $ 55,278 As of December 31, 2015 (in thousands) Level 1 Level 2 Total Assets Money market investments (1) $ — $ 433,040 $ 433,040 Marketable equity securities (3) 350,563 — 350,563 Other current investments (4) 12,822 16,060 28,882 Total Financial Assets $ 363,385 $ 449,100 $ 812,485 Liabilities Deferred compensation plan liabilities (6) $ — $ 48,055 $ 48,055 ____________ (1) The Company’s money market investments are included in cash, cash equivalents and restricted cash and the value considers the liquidity of the counterparty. (2) The Company's commercial paper investments with original maturities of three months or less are included in cash and cash equivalents. (3) The Company’s investments in marketable equity securities are classified as available-for-sale. (4) 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 valuation hierarchy. (5) Included in Deferred charges and other assets. The fair value 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. (6) 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. (7) The fair value of the mandatorily redeemable noncontrolling interest is based on an EBITDA multiple, adjusted for working capital and other items, which approximates fair value. In the third quarter of 2016, the Company recorded an impairment charge of $15.0 million to its preferred equity interest in a vocational school company due to a decline in business conditions. The measurement of the preferred equity interest is classified as a Level 3 fair value assessment due to the significance of unobservable inputs developed in the determination of the fair value. The Company used a discounted cash flow model to determine the estimated fair value of the preferred equity interest and made estimates and assumptions regarding future cash flows, discount rates, long-term growth rates and market values to determine the estimated fair value. In the third quarter of 2015 , the Company recorded a goodwill impairment charge of $248.6 million . In the second quarter of 2015 , the Company recorded a long-lived asset impairment charge of $6.9 million . The remeasurements of the goodwill and other long-lived assets are classified as Level 3 fair value assessments due to the significance of unobservable inputs developed in the determination of the fair values. The Company used a discounted cash flow model to determine the estimated fair value of the reporting unit. A market value approach was also utilized to supplement the discounted cash flow model. The Company made estimates and assumptions regarding future cash flows, discount rates, long-term growth rates and market values to determine the reporting unit’s estimated fair value. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The Company's effective tax rate for the first nine months of 2016 was 28.9% . In the third quarter of 2016, $19.3 million of the valuation allowance recorded on Australian net deferred tax assets was released, as the Company determined that it was more likely than not that the benefit of the net deferred tax assets would be realized, based on improved operating results that have recently generated positive ordinary income. Also in the third quarter of 2016, $11.0 million in deferred tax assets were written off in connection with the Company’s designation of certain intercompany loans as long-term investments. In the second quarter of 2016, the Company benefited from a favorable $5.6 million out of period deferred tax adjustment related to the KHE goodwill impairment recorded in the third quarter of 2015. The Company's effective tax rate on the loss for continuing operations for the first nine months of 2015 was 4.9% , as a large portion of the goodwill impairment charge and the goodwill included in the loss on the KHE Campuses sale are permanent differences. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | EARNINGS (LOSS) PER SHARE The Company's unvested restricted stock awards contain nonforfeitable rights to dividends and, therefore, are considered participating securities for purposes of computing earnings per share pursuant to the two-class method. The diluted earnings per share computed under the two-class method is lower than the diluted earnings per share computed under the treasury stock method, resulting in the presentation of the lower amount in diluted earnings per share. The computation of the earnings per share under the two-class method excludes the income attributable to the unvested restricted stock awards from the numerator and excludes the dilutive impact of those underlying shares from the denominator. The following reflects the Company's income (loss) from continuing operations and share data used in the basic and diluted earnings (loss) per share computations using the two-class method: Three Months Ended Nine Months Ended (in thousands, except per share amounts) 2016 2015 2016 2015 Numerator: Numerator for basic earnings per share: Income (loss) from continuing operations attributable to Graham Holdings Company common stockholders $ 33,126 $ (231,222 ) $ 131,672 $ (194,625 ) Less: Dividends paid-common stock outstanding and unvested restricted shares (6,796 ) (6,736 ) (27,329 ) (53,090 ) Undistributed earnings (loss) 26,330 (237,958 ) 104,343 (247,715 ) Percent allocated to common stockholders (1) 98.70 % 100.00 % 98.70 % 100.00 % 25,987 (237,958 ) 102,987 (247,715 ) Add: Dividends paid-common stock outstanding 6,708 6,621 26,976 52,180 Numerator for basic earnings (loss) per share $ 32,695 $ (231,337 ) $ 129,963 $ (195,535 ) Add: Additional undistributed earnings due to dilutive stock options 2 — 7 — Numerator for diluted earnings (loss) per share $ 32,697 $ (231,337 ) $ 129,970 $ (195,535 ) Denominator: Denominator for basic earnings (loss) per share: Weighted average shares outstanding 5,544 5,738 5,570 5,721 Add: Effect of dilutive stock options 30 — 30 — Denominator for diluted earnings (loss) per share 5,574 5,738 5,600 5,721 Graham Holdings Company Common Stockholders: Basic earnings (loss) per share from continuing operations $ 5.90 $ (40.32 ) $ 23.33 $ (34.18 ) Diluted earnings (loss) per share from continuing operations $ 5.87 $ (40.32 ) $ 23.21 $ (34.18 ) ____________ (1) Percent of undistributed losses allocated to common stockholders is 100% in the third quarter and first nine months of 2015 as participating securities are not contractually obligated to share in losses. Diluted earnings (loss) per share excludes the following weighted average potential common shares, as the effect would be antidilutive, as computed under the treasury stock method: Three Months Ended Nine Months Ended (in thousands) 2016 2015 2016 2015 Weighted average restricted stock 42 50 40 53 Weighted average stock options — 49 — 37 The diluted earnings per share amounts for the three and nine months ended September 30, 2016 exclude the effects of 102,000 stock options outstanding as their inclusion would have been antidilutive due to a market condition. The diluted loss per share amounts for the three and nine months ended September 30, 2015 exclude the effects of 77,258 stock options outstanding as their inclusion would have been antidilutive due to a market condition. The diluted earnings per share amounts for the three and nine months ended September 30, 2016 exclude the effects of 6,100 restricted stock awards as their inclusion would have been antidilutive due to a performance condition. The diluted loss per share amounts for the three and nine months ended September 30, 2015 exclude the effects of 5,050 restricted stock awards, as their inclusion would have been antidilutive due to a performance condition. In the three and nine months ended September 30, 2016 , the Company declared dividends totaling $ 1.21 and $4.84 , respectively. In the three and nine months ended September 30, 2015 , the Company declared regular dividends totaling $1.15 and $9.10 , respectively. |
Pension and Postretirement Plan
Pension and Postretirement Plans | 9 Months Ended |
Sep. 30, 2016 | |
General Discussion of Pension and Other Postretirement Benefits [Abstract] | |
Pension and Postretirement Plans | PENSION AND POSTRETIREMENT PLANS Cable ONE Spin-Off. On July 1, 2015, as part of the spin-off, Cable ONE assumed the liability related to their employees participating in the Company's Supplemental Executive Retirement Plan (SERP). The Company also eliminated the accrual of pension benefits for all Cable ONE employees related to their future service. As a result of the spin-off of Cable ONE, the Company remeasured the accumulated and projected benefit obligation of the pension plan and SERP as of July 1, 2015, and recorded curtailment and settlement gains. The new measurement basis was used for the recognition of the SERP cost recorded in the third quarter of 2015 and the pension benefit recorded for the first two months of the third quarter of 2015. The curtailment gain on the spin-off of Cable ONE is included in income from discontinued operations, net of tax. The settlement gain on the spin-off of Cable ONE is included in the SERP liability distributed to Cable ONE (see Note 2). KHE Campuses Sale. On September 3, 2015, the Company eliminated the accrual of pension benefits for almost all of the KHE Campus employees related to their future service. As a result, the Company remeasured the accumulated and projected benefit obligation of the pension plan as of September 3, 2015, and the Company recorded a curtailment gain in the third quarter of 2015. The new measurement basis was used for the recognition of the Company's pension benefit beginning in September 2015. The curtailment gain on the sale of the KHE Campuses is included in the loss on the sale of the KHE Campuses and reported in Other (expense) income, net on the Condensed Consolidated Statement of Operations. Defined Benefit Plans. The total benefit arising from the Company’s defined benefit pension plans, including a portion included in discontinued operations, consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Service cost $ 5,040 $ 6,090 $ 15,422 $ 20,593 Interest cost 12,845 13,516 38,763 39,077 Expected return on assets (30,348 ) (33,673 ) (91,122 ) (96,771 ) Amortization of prior service cost 74 79 223 241 Recognized actuarial gain — (6,057 ) — (6,057 ) Net Periodic Benefit (12,389 ) (20,045 ) (36,714 ) (42,917 ) Curtailment gains — (3,267 ) — (3,267 ) Early retirement programs and special separation benefit expense — 3,734 — 3,734 Total Benefit $ (12,389 ) $ (19,578 ) $ (36,714 ) $ (42,450 ) For the three and nine months ended September 30, 2015 , the net periodic benefit for the Company's pension plans, as reported above, includes benefits of $0.1 million and costs of $1.9 million , respectively, reported in discontinued operations. The curtailment gain of $2.2 million related to the Cable spin-off is also included in discontinued operations for the three and nine months ended September 30, 2015 . The curtailment gain of $1.1 million related to the sale of the KHE Campuses business is included in Other (expense) income, net. In the third quarter of 2015, the Company recorded $3.7 million related to a Separation Incentive Program for certain Kaplan employees, which was funded from the assets of the Company's pension plan. The total cost arising from the Company’s Supplemental Executive Retirement Plan (SERP), including a portion included in discontinued operations, consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Service cost $ 246 $ 464 $ 738 $ 1,482 Interest cost 1,096 1,140 3,288 3,410 Amortization of prior service cost 114 115 342 343 Recognized actuarial loss 665 630 1,995 2,385 Net Periodic Cost $ 2,121 $ 2,349 $ 6,363 $ 7,620 For the nine months ended September 30, 2015 , the net periodic cost for the Company's SERP, as reported above, includes costs of $0.2 million reported in discontinued operations. Defined Benefit Plan Assets. The Company’s defined benefit pension obligations are funded by a portfolio made up of a U.S. stock index fund, a relatively small number of stocks and high-quality fixed-income securities that are held by a third-party trustee. The assets of the Company’s pension plan were allocated as follows: As of September 30, December 31, U.S. equities 78 % 62 % U.S. fixed income 15 % 13 % International equities 7 % 25 % 100 % 100 % Beginning in the second quarter of 2016, the Company started managing approximately 44% of the pension assets internally, of which the majority is invested in a U.S. stock index fund with the remaining investments in Berkshire Hathaway stock and short-term fixed income securities. The remaining 56% of plan assets are still managed by two investment companies. The goal for the investments is to produce moderate long-term growth in the value of these assets, while protecting them against large decreases in value. Both investment managers may invest in a combination of equity and fixed-income securities and cash. The managers are not permitted to invest in securities of the Company or in alternative investments. The investment managers cannot invest more than 20% of the assets at the time of purchase in the stock of Berkshire Hathaway or more than 10% of the assets in the securities of any other single issuer, except for obligations of the U.S. Government, without receiving prior approval from the Plan administrator. As of September 30, 2016 , the investment managers can invest no more than 23% of the assets they manage in specified international exchanges, at the time the investment is made, and no less than 10% of the assets could be invested in fixed-income securities. In determining the expected rate of return on plan assets, the Company considers the relative weighting of plan assets, the historical performance of total plan assets and individual asset classes and economic and other indicators of future performance. In addition, the Company may consult with and consider the input of financial and other professionals in developing appropriate return benchmarks. The Company evaluated its defined benefit pension plan asset portfolio for the existence of significant concentrations (defined as greater than 10% of plan assets) of credit risk as of September 30, 2016 . Types of concentrations that were evaluated include, but are not limited to, investment concentrations in a single entity, type of industry, foreign country and individual fund. At September 30, 2016 , the pension plan held investments in one common stock and one U.S. stock index fund that exceeded 10% of total plan assets, valued at $915.2 million , or 45% of total plan assets. At December 31, 2015 , the pension plan held common stock in two investments that exceeded 10% of total plan assets, valued at $562.6 million , or 25% of total plan assets. At December 31, 2015 , the pension plan held investments in one foreign country that exceeded 10% of total plan assets, valued at $332.4 million , or 15% of total plan assets. Other Postretirement Plans. The total cost arising from the Company’s other postretirement plans consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Service cost $ 346 $ 333 $ 1,039 $ 999 Interest cost 308 325 923 974 Amortization of prior service credit (83 ) (126 ) (251 ) (377 ) Recognized actuarial gain (376 ) (249 ) (1,127 ) (747 ) Net Periodic Cost $ 195 $ 283 $ 584 $ 849 |
Other Non-Operating Income
Other Non-Operating Income | 9 Months Ended |
Sep. 30, 2016 | |
Other Nonoperating Income (Expense) [Abstract] | |
Other Non-Operating (Expense) Income | OTHER NON-OPERATING (EXPENSE) INCOME A summary of non-operating (expense) income is as follows: Three Months Ended Nine Months Ended (in thousands) 2016 2015 2016 2015 Gain on sale of land $ — $ — $ 34,072 $ — Foreign currency loss, net (3,797 ) (12,972 ) (33,324 ) (16,191 ) Gain (loss) on sales of businesses — (26,253 ) 18,931 (23,335 ) Loss on write-downs of cost method investments (15,000 ) (1,114 ) (15,161 ) (1,364 ) Gain on sales of marketable equity securities (see Note 3) — — 6,256 — Gain on formation of joint ventures — — 3,232 5,972 Additional gain on sale of Classified Ventures — — — 4,827 Other, net 572 (119 ) 1,865 206 Total Other Non-Operating (Expense) Income $ (18,225 ) $ (40,458 ) $ 15,871 $ (29,885 ) In the third quarter of 2016 , the Company recorded an impairment of $15.0 million to the preferred equity interest in a vocational school company. In the second quarter of 2016 , the Company sold the remaining portion of the Robinson Terminal real estate retained from the sale of the Publishing Subsidiaries, for a gain of $34.1 million . In June 2016 , Residential contributed assets to a joint venture entered into with a Michigan hospital in exchange for a 40% equity interest and other assets, resulting in a $3.2 million gain (see Note 4). The Company used an income and market approach to value the equity interest. The measurement of the equity interest in the joint venture is classified as a Level 3 fair value assessment due to the significance of unobservable inputs developed in the determination of the fair value. In the first quarter of 2016 , Kaplan sold Colloquy, which was a part of Kaplan corporate and other, for a gain of $18.9 million . In the third quarter of 2015 , Kaplan sold the KHEC Campuses business, and Franklyn Scholar, which was part of Kaplan International, for a loss of $26.3 million . In the second quarter of 2015 , the Company sold The Root and Kaplan sold two small businesses for a total gain of $2.9 million . In the second quarter of 2015 , the Company benefited from a $4.8 million favorable out of period adjustment to the gain on the sale of Classified Ventures related to the fourth quarter of 2014 . With respect to this error, the Company has concluded that it was not material to the Company's financial position or results of operations for 2015 and the related interim periods, based on its consideration of quantitative and qualitative factors. In January 2015, Celtic contributed assets to a joint venture entered into with AHN in exchange for a 40% equity interest, resulting in the Company recording a $6.0 million gain (see Note 4). The Company used an income and market approach to value the equity interest. The measurement of the equity interest in the joint venture is classified as a Level 3 fair value assessment due to the significance of unobservable inputs developed in the determination of the fair value. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The other comprehensive income (loss) consists of the following components: Three Months Ended September 30 2016 2015 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 $ (353 ) $ — $ (353 ) $ (10,548 ) $ — $ (10,548 ) Adjustment for sales of businesses with foreign operations — — — 6,026 — 6,026 (353 ) — (353 ) (4,522 ) — (4,522 ) Unrealized gains on available-for-sale securities: Unrealized gains for the period, net 12,154 (4,862 ) 7,292 3,836 (1,535 ) 2,301 Pension and other postretirement plans: Amortization of net prior service cost included in net income 105 (41 ) 64 68 (27 ) 41 Amortization of net actuarial loss (gain) included in net income 289 (116 ) 173 (5,676 ) 2,271 (3,405 ) Curtailment gains included in net income — — — 51 (21 ) 30 Curtailment and settlement included in distribution to Cable ONE — — — 1,403 (561 ) 842 394 (157 ) 237 (4,154 ) 1,662 (2,492 ) Cash flow hedge: Gain for the period 49 (20 ) 29 — — — Other Comprehensive Income (Loss) $ 12,244 $ (5,039 ) $ 7,205 $ (4,840 ) $ 127 $ (4,713 ) Nine Months Ended September 30 2016 2015 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 $ (1,629 ) $ — $ (1,629 ) $ (17,387 ) $ — $ (17,387 ) Adjustment for sales of businesses with foreign operations — — — 5,501 — 5,501 (1,629 ) — (1,629 ) (11,886 ) — (11,886 ) Unrealized gains (losses) on available-for-sale securities: Unrealized gains (losses) for the period, net 7,190 (2,876 ) 4,314 (16,497 ) 6,599 (9,898 ) Reclassification of realized gain on sale of available-for-sale securities included in net income (6,256 ) 2,502 (3,754 ) — — — 934 (374 ) 560 (16,497 ) 6,599 (9,898 ) Pension and other postretirement plans: Amortization of net prior service cost included in net income 314 (125 ) 189 207 (82 ) 125 Amortization of net actuarial loss (gain) included in net income 868 (347 ) 521 (4,419 ) 1,768 (2,651 ) Curtailment gains included in net income — — — 51 (21 ) 30 Curtailment and settlement included in distribution to Cable ONE — — — 1,403 (561 ) 842 1,182 (472 ) 710 (2,758 ) 1,104 (1,654 ) Cash flow hedge: Gain for the period 49 (20 ) 29 179 (71 ) 108 Other Comprehensive Income (Loss) $ 536 $ (866 ) $ (330 ) $ (30,962 ) $ 7,632 $ (23,330 ) The accumulated balances related to each component of other comprehensive income (loss) are as follows: (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, 2015 $ (4,849 ) $ 58,500 $ 261,029 $ — $ 314,680 Other comprehensive (loss) income before reclassifications (1,629 ) 4,314 — 31 2,716 Net amount reclassified from accumulated other comprehensive income — (3,754 ) 710 (2 ) (3,046 ) Other comprehensive (loss) income, net of tax (1,629 ) 560 710 29 (330 ) Balance as of September 30, 2016 $ (6,478 ) $ 59,060 $ 261,739 $ 29 $ 314,350 The amounts and line items of reclassifications out of Accumulated Other Comprehensive Income (Loss) are as follows: Three Months Ended Nine Months Ended Affected Line Item in the Condensed Consolidated Statement of Operations (in thousands) 2016 2015 2016 2015 Foreign Currency Translation Adjustments: Adjustment for sales of businesses with foreign operations $ — $ 6,026 $ — $ 5,501 Other (expense) income, net Unrealized Gains on Available-for-sale Securities: Realized gain for the period — — (6,256 ) — Other (expense) income, net — — 2,502 — Provision (Benefit) for Income Taxes — — (3,754 ) — Net of Tax Pension and Other Postretirement Plans: Amortization of net prior service cost 105 68 314 207 (1) Amortization of net actuarial loss (gain) 289 (5,676 ) 868 (4,419 ) (1) Curtailment gains — 51 — 51 (1) 394 (5,557 ) 1,182 (4,161 ) Before tax (157 ) 2,223 (472 ) 1,665 Provision (Benefit) for Income Taxes 237 (3,334 ) 710 (2,496 ) Net of Tax Cash Flow Hedge (3 ) — (3 ) 132 Interest expense 1 — 1 (53 ) Provision (Benefit) for Income Taxes (2 ) — (2 ) 79 Net of Tax Total reclassification for the period $ 235 $ 2,692 $ (3,046 ) $ 3,084 Net of Tax ____________ (1) These accumulated other comprehensive income components are included in the computation of net periodic pension and postretirement plan cost (see Note 10). |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | CONTINGENCIES Litigation and Legal Matters. The Company and its subsidiaries are involved in various legal proceedings that arise in the ordinary course of its business. Although the outcomes of the legal claims and proceedings against the Company cannot be predicted with certainty, based on currently available information, management believes that there are no existing claims or proceedings that are likely to have a material effect on the Company's business, financial condition, results of operations or cash flows. Also, based on currently available information, management is of the opinion that the exposure to future material losses from existing legal proceedings is not reasonably possible, or that future material losses in excess of the amounts accrued are not reasonably possible. Certain Kaplan subsidiaries are subject to two unsealed cases filed by former employees that include, among other allegations, claims under the False Claims Act relating to eligibility for Title IV funding. The U.S. Government declined to intervene in all cases, and, as previously reported, court decisions either dismissed the cases in their entirety or narrowed the scope of their allegations. The two cases are captioned: United States of America ex rel. Carlos Urquilla-Diaz et al . v . Kaplan University et al. (unsealed March 25, 2008) and United States of America ex rel. Charles Jajdelski v . Kaplan Higher Education Corp . et al. (unsealed January 6, 2009). In August 2011, the U.S. District Court for the Southern District of Florida issued a series of rulings in the Diaz case, which included three separate complaints: Diaz, Wilcox and Gillespie. The court dismissed the Wilcox complaint in its entirety; dismissed all False Claims Act allegations in the Diaz complaint, leaving only an individual employment claim; and dismissed in part the Gillespie complaint, thereby limiting the scope and time frame of its False Claims Act allegations regarding compliance with the U.S. Federal Rehabilitation Act. In October 2012, the court entered summary judgment in favor of the Company as to the sole remaining employment claim in the Diaz complaint. In July 2013, the court likewise entered summary judgment in favor of the Company on all remaining claims in the Gillespie complaint. Diaz and Gillespie each appealed to the U.S. Court of Appeals for the Eleventh Judicial Court. Arguments on both appeals were heard in February 2015. In March 2015, the court issued a decision affirming the lower court's dismissal of all of Gillespie's claims and three of the four Diaz claims but reversing and remanding on one remaining claim alleging that incentive compensation for admissions representatives was improperly based on enrollment counts. Kaplan filed an answer to Diaz's amended complaint in September 2015 and a renewed motion to dismiss, and a hearing was held in December 2015. In March 2016, the Court denied the motion to dismiss and discovery is ongoing in the case. In February 2016, Gillespie filed a new motion with the District Court alleging that the Court improperly refused to consider a motion to vacate while the case was on appeal; Kaplan filed an opposition to this motion that was denied by the Court. ED Program Reviews. ED has undertaken program reviews at various KHE locations. Currently, there are five open program reviews, four of which are at campuses that were formerly a part of the KHE Campuses business, including the ED’s final reports on the program reviews at KHE’s Broomall, PA, and Pittsburgh, PA, locations. Kaplan retains responsibility for any financial obligation resulting from the ED program reviews at the KHE Campuses business. On February 23, 2015, the ED began a review of Kaplan University. The review will assess Kaplan’s administration of its Title IV, HEA programs and will initially focus on the 2013 to 2014 and 2014 to 2015 award years. On December 17, 2015, Kaplan University received a notice from the ED that it had been placed on provisional certification status until September 30, 2018, in connection with the open and ongoing ED program review. The ED has not notified Kaplan University of any negative findings. However, at this time, Kaplan cannot predict the outcome of this review, when it will be completed or any liability or other limitations that the ED may place on Kaplan University as a result of this review. During the period of provisional certification, Kaplan University must obtain prior ED approval to open a new location, add an educational program, acquire another school or make any other significant change. In March and April 2015, the ED conducted a program review of the nationally accredited San Antonio (Ingram) and Hammond (Indiana) KHE campuses. These campuses were subsequently a part of the sale of the nationally accredited campuses to a vocational school company. Kaplan retains liability for any deficiency findings relating to pre-sale conduct. On July 20, 2016, the vocational school company received the Preliminary Program Review Report for the two reviews from the ED. The Report highlighted a number of required policy changes and requires the vocational school company to conduct a full review of student files over a two year period to help the Department determine if the school properly reported enrollment status for certain students to the National Student Loan Data System. Failure to properly report status could result in students receiving funds for which they were not entitled. Kaplan will work with the vocational school company on these reviews; however, until they are completed, Kaplan cannot predict the final outcome or potential liability associated with these reviews. The Company does not expect the open program reviews to have a material impact on KHE; however, the results of open program reviews and their impact on Kaplan’s operations are uncertain. Accreditation Review. In the second quarter of 2016, the Higher Learning Commission (HLC), Kaplan University's accreditor, conducted an on-site review as part of Kaplan University's regularly scheduled reaffirmation of accreditation. In August 2016, the HLC reaffirmed the Kaplan University accreditation for a ten-year term through the 2025-2026 academic year. |
Business Segments
Business Segments | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Business Segments | BUSINESS SEGMENTS The Company has four reportable segments: Kaplan Higher Education, Kaplan Test Preparation, Kaplan International and television broadcasting. The following table summarizes financial information related to each of the Company's business segments: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Operating Revenues Education $ 386,936 $ 481,746 $ 1,207,225 $ 1,505,973 Television broadcasting 112,389 89,693 300,927 264,010 Other businesses 122,313 70,052 344,298 199,823 Corporate office — — — — Intersegment elimination — (59 ) (139 ) (59 ) $ 621,638 $ 641,432 $ 1,852,311 $ 1,969,747 Income (Loss) from Operations Education $ 16,333 $ (242,777 ) $ 63,713 $ (249,778 ) Television broadcasting 59,159 40,526 144,594 121,102 Other businesses (10,801 ) (3,059 ) (21,593 ) (10,382 ) Corporate office 3,342 (8,413 ) 7,331 (9,578 ) $ 68,033 $ (213,723 ) $ 194,045 $ (148,636 ) Equity in (Losses) Earnings of Affiliates, Net (1,008 ) 95 (895 ) (662 ) Interest Expense, Net (7,874 ) (7,349 ) (22,481 ) (23,316 ) Other (Expense) Income, Net (18,225 ) (40,458 ) 15,871 (29,885 ) Income (Loss) from Continuing Operations Before Income Taxes $ 40,926 $ (261,435 ) $ 186,540 $ (202,499 ) Depreciation of Property, Plant and Equipment Education $ 9,977 $ 10,637 $ 31,322 $ 51,145 Television broadcasting 2,540 2,237 7,367 6,471 Other businesses 3,289 1,335 9,389 3,891 Corporate office 291 251 825 759 $ 16,097 $ 14,460 $ 48,903 $ 62,266 Amortization of Intangible Assets and Impairment of Goodwill and Other Long-lived Assets Education $ 1,773 $ 249,930 $ 5,158 $ 259,780 Television broadcasting 63 63 189 189 Other businesses 4,784 3,110 13,813 9,395 Corporate office — — — — $ 6,620 $ 253,103 $ 19,160 $ 269,364 Net Pension (Credit) Expense Education $ 2,838 $ 7,525 $ 8,965 $ 15,419 Television broadcasting 428 425 1,285 1,207 Other businesses 279 328 839 707 Corporate office (15,934 ) (24,533 ) (47,803 ) (58,410 ) $ (12,389 ) $ (16,255 ) $ (36,714 ) $ (41,077 ) Asset information for the Company’s business segments are as follows: As of (in thousands) September 30, December 31, Identifiable Assets Education $ 1,383,555 $ 1,454,520 Television broadcasting 336,396 312,243 Other businesses 743,376 712,161 Corporate office 510,818 484,139 $ 2,974,145 $ 2,963,063 Investments in Marketable Equity Securities 382,777 350,563 Investments in Affiliates 64,815 59,229 Prepaid Pension Cost 1,016,908 979,970 Total Assets $ 4,438,645 $ 4,352,825 The Company’s education division comprises the following operating segments: Three Months Ended Nine Months Ended September 30 September 30 (in thousands) 2016 2015 2016 2015 Operating Revenues Higher education $ 148,602 $ 203,529 $ 472,131 $ 681,814 Test preparation 78,291 83,706 224,102 233,313 Kaplan international 160,456 192,702 512,068 585,486 Kaplan corporate and other 47 1,905 190 5,723 Intersegment elimination (460 ) (96 ) (1,266 ) (363 ) $ 386,936 $ 481,746 $ 1,207,225 $ 1,505,973 Income (Loss) from Operations Higher education $ 11,494 $ 3,153 $ 50,037 $ 28,510 Test preparation 8,588 13,620 13,314 16,365 Kaplan international 1,561 8,295 22,937 33,585 Kaplan corporate and other (5,310 ) (267,882 ) (22,526 ) (328,333 ) Intersegment elimination — 37 (49 ) 95 $ 16,333 $ (242,777 ) $ 63,713 $ (249,778 ) Depreciation of Property, Plant and Equipment Higher education $ 4,157 $ 4,066 $ 12,325 $ 13,688 Test preparation 1,441 2,052 4,837 7,205 Kaplan international 4,360 4,277 13,739 14,004 Kaplan corporate and other 19 242 421 16,248 $ 9,977 $ 10,637 $ 31,322 $ 51,145 Amortization of Intangible Assets $ 1,773 $ 1,339 $ 5,158 $ 4,313 Impairment of Goodwill and Other Long-lived Assets $ — $ 248,591 $ — $ 255,467 Pension Expense Higher education $ 1,905 $ 3,964 $ 5,715 $ 9,028 Test preparation 768 775 2,304 2,325 Kaplan international 67 114 201 326 Kaplan corporate and other 98 2,672 745 3,740 $ 2,838 $ 7,525 $ 8,965 $ 15,419 In the third quarter of 2015, a favorable $3.0 million out of period revenue adjustment was included at the test preparation segment that related to prior periods from 2011 through the second quarter of 2015. With respect to this error, the Company has concluded that it was not material to the Company's financial position or results of operations for 2015 and prior years and the related interim periods, based on its consideration of quantitative and qualitative factors. Asset information for the Company's education division is as follows: As of (in thousands) September 30, December 31, Identifiable assets Higher education $ 227,203 $ 447,282 Test preparation 139,975 134,535 Kaplan international 980,911 826,475 Kaplan corporate and other 35,466 46,228 $ 1,383,555 $ 1,454,520 |
Organization, Basis of Presen20
Organization, Basis of Presentation And Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation – The accompanying condensed consolidated financial statements have been prepared in accordance with: (i) generally accepted accounting principles in the United States of America (GAAP) for interim financial information; (ii) the instructions to Form 10-Q; and (iii) the guidance of Rule 10-01 of Regulation S-X under the Securities and Exchange Act of 1934, as amended, for financial statements required to be filed with the Securities and Exchange Commission (SEC). They include the assets, liabilities, results of operations and cash flows of the Company, including its domestic and foreign subsidiaries that are more than 50% owned or otherwise controlled by the Company. As permitted under such rules, certain notes and other financial information normally required by GAAP have been condensed or omitted. Management believes the accompanying condensed consolidated financial statements reflect all normal and recurring adjustments necessary for a fair statement of the Company’s financial position, results of operations, and cash flows as of and for the periods presented herein. The Company’s results of operations for the three and nine months ended September 30, 2016 and 2015 may not be indicative of the Company’s future results. These condensed consolidated financial statements are unaudited and should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 . The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. Certain amounts in previously issued financial statements have been reclassified to conform to the current year presentation, which includes the reclassification of the results of operations of certain businesses as discontinued operations for all periods presented. |
Use of Estimates in the Preparation of the Condensed Consolidated Financial Statements | Use of Estimates in the Preparation of the Condensed Consolidated Financial Statements – The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and judgments that affect the amounts reported herein. Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in those estimates. |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted and Issued Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (FASB) issued comprehensive new guidance that supersedes all existing revenue recognition guidance. In August 2015, the FASB issued an amendment to the guidance that defers the effective date by one year. The new guidance requires revenue to be recognized when the Company transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The new guidance also significantly expands the disclosure requirements for revenue recognition. The guidance is effective for interim and fiscal years beginning after December 15, 2017. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016. The standard permits two implementation approaches, one requiring retrospective application of the new guidance with a restatement of prior years and one requiring prospective application of the new guidance with disclosure of results under the old guidance. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements and believes such evaluation will extend over several future periods because of the significance of the changes to the Company’s policies and business processes. In August 2014, the FASB issued new guidance that requires management to assess the Company’s ability to continue as a going concern and to provide related disclosures in certain circumstances. This guidance is effective for interim and fiscal years ending after December 15, 2016, with early adoption permitted. The Company does not expect this guidance to have an impact on its Condensed Consolidated Financial Statements. In April 2015, the FASB issued new guidance that simplifies the presentation of debt issuance costs. The new guidance requires that debt issuance costs be reported in the balance sheet as a direct deduction from the gross amount of debt instead of classified as a deferred asset. The guidance is effective for interim and fiscal years beginning after December 15, 2015. The Company adopted the new guidance retrospectively as of January 1, 2016. Therefore, prior periods have been adjusted to reflect this guidance which resulted in the reclassification of $0.1 million of unamortized debt issuance costs related to the Company's 7.25% unsecured notes from deferred charges and other assets to long-term debt within its Condensed Consolidated Balance Sheet as of December 31, 2015. In January 2016, the FASB issued new guidance that substantially revises the recognition, measurement and presentation of financial assets and financial liabilities. The new guidance, among other things, requires, (i) equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income, with some exceptions, (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment, (iii) requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, (iv) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements, and (v) clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. The guidance is effective for interim and fiscal years beginning after December 15, 2017. Early adoption is not permitted. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements. In February 2016, the FASB issued new guidance that requires, among other things, a lessee to recognize a right-of-use asset representing an entity's right to use the underlying asset for the lease term and a liability for lease payments on its balance sheet, regardless of classification of a lease as operating or financing. For leases with a term of twelve months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and liabilities and account for the lease similar to existing guidance for operating leases today. This new guidance supersedes all prior guidance. The guidance is effective for interim and fiscal years beginning after December 15, 2018. Early adoption is permitted. The standard requires lessees and lessors to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements. In March 2016, the FASB issued new guidance that simplifies the accounting for stock-based compensation. The new guidance (i) requires all excess tax benefits and tax deficiencies to be recognized in the income statement with the tax effects of vested or exercised awards treated as discrete items. Additionally, excess tax benefits will be recognized regardless of whether the benefit reduces taxes payable in the current period, effectively eliminating the APIC pool, (ii) concludes excess tax benefits should be classified as an operating activity in the statement of cash flows, (iii) requires an entity to make an entity-wide accounting policy election to either estimate a forfeiture rate for awards or account for forfeitures as they occur, (iv) changes the threshold for equity classification for cash settlements of awards for withholding requirements to the maximum statutory tax rate in the applicable jurisdiction and (v) concludes cash paid by an employer when directly withholding shares for tax-withholding purposes should be classified as a financing activity in the statement of cash flows. The guidance is effective for interim and fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Summarized Discontinued Operations Information | The summarized income from discontinued operations, net of tax, is presented below: Three Months Ended Nine Months Ended (in thousands) September 30, 2015 September 30, 2015 Operating revenues $ — $ 397,404 Operating costs and expenses 1,662 (325,379 ) Operating income 1,662 72,025 Non-operating expense — (1,288 ) Income from discontinued operations 1,662 70,737 Provision for income taxes 1,283 27,783 Net Income from Discontinued Operations 379 42,954 Loss on sale of discontinued operations — (732 ) Provision for income taxes on disposition of discontinued operations — 52 Income from Discontinued Operations, Net of Tax $ 379 $ 42,170 |
Cable Spin-Off [Member] | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Discontinued Operations Cash Flows | Cash flows from Cable ONE are as follows: Three Months Ended Nine Months Ended (in thousands) September 30, 2015 September 30, 2015 Net Cash (Used in) Provided by Operating Activities $ (4,468 ) $ 111,665 Net Cash Used in Investing Activities — (74,416 ) |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Investments [Abstract] | |
Investments in Marketable Equity Securities | Investments in marketable equity securities comprised the following: As of September 30, December 31, (in thousands) Total cost $ 284,343 $ 253,062 Gross unrealized gains 107,145 97,741 Gross unrealized losses (8,711 ) (240 ) Total Fair Value $ 382,777 $ 350,563 |
Acquisitions and Dispositions23
Acquisitions and Dispositions of Businesses (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Acqusitions and Dispositions [Abstract] | |
Schedule of assets acquired and liabilities assumed | Acquisition-related costs were expensed as incurred and were not significant. The aggregate purchase price of the 2016 acquisitions was allocated as follows on a preliminary basis: Weighted Average Life Purchase Price Allocation (in thousands) Cash and cash equivalents $ 10,587 Accounts receivable 8,415 Inventory 971 Other current assets 1,420 Property, plant and equipment 3,940 Goodwill 181,228 Indefinite-lived intangible assets Trade names and trademarks 53,110 Amortized intangible assets Student and customer relationships 6 years 22,292 Trade names and trademarks 6 years 2,425 Noncompete agreements 2 years 350 Other 7 years 2,200 6 years 27,267 Current liabilities (20,714 ) Noncurrent liabilities (11,378 ) $ 254,846 |
Acquisition Pro Forma Financial Information [Table Text Block] | The following unaudited pro forma financial information presents the Company’s results as if the acquisitions had occurred at the beginning of 2015 . The unaudited pro forma information also includes the 2015 acquisitions as if they occurred at the beginning of 2014: Three Months Ended Nine Months Ended (in thousands) 2016 2015 2016 2015 Operating revenues $ 626,223 $ 696,570 $ 1,869,174 $ 2,147,273 Net income (loss) 32,400 (229,831 ) 135,478 (138,545 ) |
Information related to Disposal Group | The revenue and operating losses related to schools that were sold as part of the KHEC Campuses sale are as follows: Three Months Ended Nine Months Ended (in thousands) Revenue $ 43,121 $ 167,244 Operating income (loss) 629 (6,672 ) |
Goodwill and Other Intangible24
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill, by segment, were as follows: (in thousands) Education Television Broadcasting Other Businesses Total Balance as of December 31, 2015 Goodwill $ 1,006,096 $ 168,345 $ 202,814 $ 1,377,255 Accumulated impairment losses (350,850 ) — (8,892 ) (359,742 ) 655,246 168,345 193,922 1,017,513 Measurement period adjustments (2,781 ) — (16,930 ) (19,711 ) Acquisitions 160,894 — 20,334 181,228 Dispositions — — (2,800 ) (2,800 ) Foreign currency exchange rate changes (25,784 ) — — (25,784 ) Balance as of September 30, 2016 Goodwill 1,138,425 168,345 200,608 1,507,378 Accumulated impairment losses (350,850 ) — (6,082 ) (356,932 ) $ 787,575 $ 168,345 $ 194,526 $ 1,150,446 |
Other Intangible Assets | Other intangible assets consist of the following: As of September 30, 2016 As of December 31, 2015 (in thousands) Useful Life Range Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Accumulated Net Amortized Intangible Assets Student and customer relationships 2–10 years $ 130,264 $ 51,902 $ 78,362 $ 108,806 $ 40,280 $ 68,526 Trade names and trademarks 2–10 years 55,705 27,929 27,776 53,848 23,941 29,907 Databases and technology 3–5 years 4,617 4,304 313 4,617 4,114 503 Noncompete agreements 2–5 years 1,731 1,273 458 1,381 1,012 369 Other 1–8 years (1) 12,031 4,304 7,727 10,095 2,209 7,886 $ 204,348 $ 89,712 $ 114,636 $ 178,747 $ 71,556 $ 107,191 Indefinite-Lived Intangible Assets Trade names and trademarks $ 67,946 $ 21,051 Licensure and accreditation 834 834 $ 68,780 $ 21,885 ____________ (1) The Company's other amortized intangible assets’ maximum useful life was 7 years as of December 31, 2015. |
Education [Member] | |
Changes in Carrying Amount of Goodwill | The changes in carrying amount of goodwill at the Company’s education division were as follows: (in thousands) Higher Education Test Preparation Kaplan International Total Balance as of December 31, 2015 Goodwill $ 392,457 $ 166,098 $ 447,541 $ 1,006,096 Accumulated impairment losses (248,591 ) (102,259 ) — (350,850 ) 143,866 63,839 447,541 655,246 Measurement period adjustments (2,781 ) — — (2,781 ) Acquisitions — — 160,894 160,894 Foreign currency exchange rate changes 104 — (25,888 ) (25,784 ) Balance as of September 30, 2016 Goodwill 389,780 166,098 582,547 1,138,425 Accumulated impairment losses (248,591 ) (102,259 ) — (350,850 ) $ 141,189 $ 63,839 $ 582,547 $ 787,575 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Components of Debt | The Company’s borrowings consist of the following: As of September 30, December 31, (in thousands) 7.25% unsecured notes due February 1, 2019 (1) $ 398,938 $ 398,596 UK Credit facility (2) 96,984 — Other indebtedness 1,486 1,204 Total Debt $ 497,408 $ 399,800 Less: current portion (6,498 ) — Total Long-Term Debt $ 490,910 $ 399,800 ___________ _ (1) The carrying value is net of $0.1 million of unamortized debt issuance costs as of September 30, 2016 and December 31, 2015 , respectively. (2) The carrying value is net of $0.6 million of unamortized debt issuance costs as of September 30, 2016 . |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The Company’s financial assets and liabilities measured at fair value on a recurring basis were as follows: As of September 30, 2016 (in thousands) Level 1 Level 2 Level 3 Total Assets Money market investments (1) $ — $ 281,386 $ — $ 281,386 Commercial paper (2) 90,835 — — 90,835 Marketable equity securities (3) 382,777 — — 382,777 Other current investments (4) 9,746 16,147 — 25,893 Interest rate swap (5) — 51 — 51 Total Financial Assets $ 483,358 $ 297,584 $ — $ 780,942 Liabilities Deferred compensation plan liabilities (6) $ — $ 45,431 $ — $ 45,431 Mandatorily redeemable noncontrolling interest (7) — — 9,847 9,847 Total Financial Liabilities $ — $ 45,431 $ 9,847 $ 55,278 As of December 31, 2015 (in thousands) Level 1 Level 2 Total Assets Money market investments (1) $ — $ 433,040 $ 433,040 Marketable equity securities (3) 350,563 — 350,563 Other current investments (4) 12,822 16,060 28,882 Total Financial Assets $ 363,385 $ 449,100 $ 812,485 Liabilities Deferred compensation plan liabilities (6) $ — $ 48,055 $ 48,055 ____________ (1) The Company’s money market investments are included in cash, cash equivalents and restricted cash and the value considers the liquidity of the counterparty. (2) The Company's commercial paper investments with original maturities of three months or less are included in cash and cash equivalents. (3) The Company’s investments in marketable equity securities are classified as available-for-sale. (4) 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 valuation hierarchy. (5) Included in Deferred charges and other assets. The fair value 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. (6) 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. (7) The fair value of the mandatorily redeemable noncontrolling interest is based on an EBITDA multiple, adjusted for working capital and other items, which approximates fair value. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Summary of Earnings Per Share from Continuing Operations, Basic and Diluted | The following reflects the Company's income (loss) from continuing operations and share data used in the basic and diluted earnings (loss) per share computations using the two-class method: Three Months Ended Nine Months Ended (in thousands, except per share amounts) 2016 2015 2016 2015 Numerator: Numerator for basic earnings per share: Income (loss) from continuing operations attributable to Graham Holdings Company common stockholders $ 33,126 $ (231,222 ) $ 131,672 $ (194,625 ) Less: Dividends paid-common stock outstanding and unvested restricted shares (6,796 ) (6,736 ) (27,329 ) (53,090 ) Undistributed earnings (loss) 26,330 (237,958 ) 104,343 (247,715 ) Percent allocated to common stockholders (1) 98.70 % 100.00 % 98.70 % 100.00 % 25,987 (237,958 ) 102,987 (247,715 ) Add: Dividends paid-common stock outstanding 6,708 6,621 26,976 52,180 Numerator for basic earnings (loss) per share $ 32,695 $ (231,337 ) $ 129,963 $ (195,535 ) Add: Additional undistributed earnings due to dilutive stock options 2 — 7 — Numerator for diluted earnings (loss) per share $ 32,697 $ (231,337 ) $ 129,970 $ (195,535 ) Denominator: Denominator for basic earnings (loss) per share: Weighted average shares outstanding 5,544 5,738 5,570 5,721 Add: Effect of dilutive stock options 30 — 30 — Denominator for diluted earnings (loss) per share 5,574 5,738 5,600 5,721 Graham Holdings Company Common Stockholders: Basic earnings (loss) per share from continuing operations $ 5.90 $ (40.32 ) $ 23.33 $ (34.18 ) Diluted earnings (loss) per share from continuing operations $ 5.87 $ (40.32 ) $ 23.21 $ (34.18 ) ____________ (1) Percent of undistributed losses allocated to common stockholders is 100% in the third quarter and first nine months of 2015 as participating securities are not contractually obligated to share in losses. |
Antidilutive Weighted Average Restricted Stock and Options | Diluted earnings (loss) per share excludes the following weighted average potential common shares, as the effect would be antidilutive, as computed under the treasury stock method: Three Months Ended Nine Months Ended (in thousands) 2016 2015 2016 2015 Weighted average restricted stock 42 50 40 53 Weighted average stock options — 49 — 37 |
Pension and Postretirement Pl28
Pension and Postretirement Plans (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Defined Benefit Pension Plan [Member] | |
Schedule of Net Benefit Costs | Defined Benefit Plans. The total benefit arising from the Company’s defined benefit pension plans, including a portion included in discontinued operations, consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Service cost $ 5,040 $ 6,090 $ 15,422 $ 20,593 Interest cost 12,845 13,516 38,763 39,077 Expected return on assets (30,348 ) (33,673 ) (91,122 ) (96,771 ) Amortization of prior service cost 74 79 223 241 Recognized actuarial gain — (6,057 ) — (6,057 ) Net Periodic Benefit (12,389 ) (20,045 ) (36,714 ) (42,917 ) Curtailment gains — (3,267 ) — (3,267 ) Early retirement programs and special separation benefit expense — 3,734 — 3,734 Total Benefit $ (12,389 ) $ (19,578 ) $ (36,714 ) $ (42,450 ) |
Schedule of Allocation of Plan Assets | The assets of the Company’s pension plan were allocated as follows: As of September 30, December 31, U.S. equities 78 % 62 % U.S. fixed income 15 % 13 % International equities 7 % 25 % 100 % 100 % |
Supplemental Executive Retirement Plan (SERP) [Member] | |
Schedule of Net Benefit Costs | The total cost arising from the Company’s Supplemental Executive Retirement Plan (SERP), including a portion included in discontinued operations, consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Service cost $ 246 $ 464 $ 738 $ 1,482 Interest cost 1,096 1,140 3,288 3,410 Amortization of prior service cost 114 115 342 343 Recognized actuarial loss 665 630 1,995 2,385 Net Periodic Cost $ 2,121 $ 2,349 $ 6,363 $ 7,620 |
Other Postretirement Benefit Plan, Defined Benefit [Member] | |
Schedule of Net Benefit Costs | Other Postretirement Plans. The total cost arising from the Company’s other postretirement plans consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Service cost $ 346 $ 333 $ 1,039 $ 999 Interest cost 308 325 923 974 Amortization of prior service credit (83 ) (126 ) (251 ) (377 ) Recognized actuarial gain (376 ) (249 ) (1,127 ) (747 ) Net Periodic Cost $ 195 $ 283 $ 584 $ 849 |
Other Non-Operating Income (Tab
Other Non-Operating Income (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Other Nonoperating Income (Expense) [Abstract] | |
Summary of Other Non-Operating (Expense) Income | A summary of non-operating (expense) income is as follows: Three Months Ended Nine Months Ended (in thousands) 2016 2015 2016 2015 Gain on sale of land $ — $ — $ 34,072 $ — Foreign currency loss, net (3,797 ) (12,972 ) (33,324 ) (16,191 ) Gain (loss) on sales of businesses — (26,253 ) 18,931 (23,335 ) Loss on write-downs of cost method investments (15,000 ) (1,114 ) (15,161 ) (1,364 ) Gain on sales of marketable equity securities (see Note 3) — — 6,256 — Gain on formation of joint ventures — — 3,232 5,972 Additional gain on sale of Classified Ventures — — — 4,827 Other, net 572 (119 ) 1,865 206 Total Other Non-Operating (Expense) Income $ (18,225 ) $ (40,458 ) $ 15,871 $ (29,885 ) |
Accumulated Other Comprehensi30
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Summary of Other Comprehensive (Loss) Income | The other comprehensive income (loss) consists of the following components: Three Months Ended September 30 2016 2015 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 $ (353 ) $ — $ (353 ) $ (10,548 ) $ — $ (10,548 ) Adjustment for sales of businesses with foreign operations — — — 6,026 — 6,026 (353 ) — (353 ) (4,522 ) — (4,522 ) Unrealized gains on available-for-sale securities: Unrealized gains for the period, net 12,154 (4,862 ) 7,292 3,836 (1,535 ) 2,301 Pension and other postretirement plans: Amortization of net prior service cost included in net income 105 (41 ) 64 68 (27 ) 41 Amortization of net actuarial loss (gain) included in net income 289 (116 ) 173 (5,676 ) 2,271 (3,405 ) Curtailment gains included in net income — — — 51 (21 ) 30 Curtailment and settlement included in distribution to Cable ONE — — — 1,403 (561 ) 842 394 (157 ) 237 (4,154 ) 1,662 (2,492 ) Cash flow hedge: Gain for the period 49 (20 ) 29 — — — Other Comprehensive Income (Loss) $ 12,244 $ (5,039 ) $ 7,205 $ (4,840 ) $ 127 $ (4,713 ) Nine Months Ended September 30 2016 2015 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 $ (1,629 ) $ — $ (1,629 ) $ (17,387 ) $ — $ (17,387 ) Adjustment for sales of businesses with foreign operations — — — 5,501 — 5,501 (1,629 ) — (1,629 ) (11,886 ) — (11,886 ) Unrealized gains (losses) on available-for-sale securities: Unrealized gains (losses) for the period, net 7,190 (2,876 ) 4,314 (16,497 ) 6,599 (9,898 ) Reclassification of realized gain on sale of available-for-sale securities included in net income (6,256 ) 2,502 (3,754 ) — — — 934 (374 ) 560 (16,497 ) 6,599 (9,898 ) Pension and other postretirement plans: Amortization of net prior service cost included in net income 314 (125 ) 189 207 (82 ) 125 Amortization of net actuarial loss (gain) included in net income 868 (347 ) 521 (4,419 ) 1,768 (2,651 ) Curtailment gains included in net income — — — 51 (21 ) 30 Curtailment and settlement included in distribution to Cable ONE — — — 1,403 (561 ) 842 1,182 (472 ) 710 (2,758 ) 1,104 (1,654 ) Cash flow hedge: Gain for the period 49 (20 ) 29 179 (71 ) 108 Other Comprehensive Income (Loss) $ 536 $ (866 ) $ (330 ) $ (30,962 ) $ 7,632 $ (23,330 ) |
Summary of Changes in Accumulated Other Comprehensive (Loss) Income | The accumulated balances related to each component of other comprehensive income (loss) are as follows: (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, 2015 $ (4,849 ) $ 58,500 $ 261,029 $ — $ 314,680 Other comprehensive (loss) income before reclassifications (1,629 ) 4,314 — 31 2,716 Net amount reclassified from accumulated other comprehensive income — (3,754 ) 710 (2 ) (3,046 ) Other comprehensive (loss) income, net of tax (1,629 ) 560 710 29 (330 ) Balance as of September 30, 2016 $ (6,478 ) $ 59,060 $ 261,739 $ 29 $ 314,350 |
Summary of Amounts and Line Items of reclassifications Out of Accumulated Other Comprehensive (Loss) Income | The amounts and line items of reclassifications out of Accumulated Other Comprehensive Income (Loss) are as follows: Three Months Ended Nine Months Ended Affected Line Item in the Condensed Consolidated Statement of Operations (in thousands) 2016 2015 2016 2015 Foreign Currency Translation Adjustments: Adjustment for sales of businesses with foreign operations $ — $ 6,026 $ — $ 5,501 Other (expense) income, net Unrealized Gains on Available-for-sale Securities: Realized gain for the period — — (6,256 ) — Other (expense) income, net — — 2,502 — Provision (Benefit) for Income Taxes — — (3,754 ) — Net of Tax Pension and Other Postretirement Plans: Amortization of net prior service cost 105 68 314 207 (1) Amortization of net actuarial loss (gain) 289 (5,676 ) 868 (4,419 ) (1) Curtailment gains — 51 — 51 (1) 394 (5,557 ) 1,182 (4,161 ) Before tax (157 ) 2,223 (472 ) 1,665 Provision (Benefit) for Income Taxes 237 (3,334 ) 710 (2,496 ) Net of Tax Cash Flow Hedge (3 ) — (3 ) 132 Interest expense 1 — 1 (53 ) Provision (Benefit) for Income Taxes (2 ) — (2 ) 79 Net of Tax Total reclassification for the period $ 235 $ 2,692 $ (3,046 ) $ 3,084 Net of Tax ____________ (1) These accumulated other comprehensive income components are included in the computation of net periodic pension and postretirement plan cost (see Note 10). |
Business Segments (Tables)
Business Segments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | |
Summary of Segment Reporting Information, by Operating Segment | The following table summarizes financial information related to each of the Company's business segments: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2016 2015 2016 2015 Operating Revenues Education $ 386,936 $ 481,746 $ 1,207,225 $ 1,505,973 Television broadcasting 112,389 89,693 300,927 264,010 Other businesses 122,313 70,052 344,298 199,823 Corporate office — — — — Intersegment elimination — (59 ) (139 ) (59 ) $ 621,638 $ 641,432 $ 1,852,311 $ 1,969,747 Income (Loss) from Operations Education $ 16,333 $ (242,777 ) $ 63,713 $ (249,778 ) Television broadcasting 59,159 40,526 144,594 121,102 Other businesses (10,801 ) (3,059 ) (21,593 ) (10,382 ) Corporate office 3,342 (8,413 ) 7,331 (9,578 ) $ 68,033 $ (213,723 ) $ 194,045 $ (148,636 ) Equity in (Losses) Earnings of Affiliates, Net (1,008 ) 95 (895 ) (662 ) Interest Expense, Net (7,874 ) (7,349 ) (22,481 ) (23,316 ) Other (Expense) Income, Net (18,225 ) (40,458 ) 15,871 (29,885 ) Income (Loss) from Continuing Operations Before Income Taxes $ 40,926 $ (261,435 ) $ 186,540 $ (202,499 ) Depreciation of Property, Plant and Equipment Education $ 9,977 $ 10,637 $ 31,322 $ 51,145 Television broadcasting 2,540 2,237 7,367 6,471 Other businesses 3,289 1,335 9,389 3,891 Corporate office 291 251 825 759 $ 16,097 $ 14,460 $ 48,903 $ 62,266 Amortization of Intangible Assets and Impairment of Goodwill and Other Long-lived Assets Education $ 1,773 $ 249,930 $ 5,158 $ 259,780 Television broadcasting 63 63 189 189 Other businesses 4,784 3,110 13,813 9,395 Corporate office — — — — $ 6,620 $ 253,103 $ 19,160 $ 269,364 Net Pension (Credit) Expense Education $ 2,838 $ 7,525 $ 8,965 $ 15,419 Television broadcasting 428 425 1,285 1,207 Other businesses 279 328 839 707 Corporate office (15,934 ) (24,533 ) (47,803 ) (58,410 ) $ (12,389 ) $ (16,255 ) $ (36,714 ) $ (41,077 ) Asset information for the Company’s business segments are as follows: As of (in thousands) September 30, December 31, Identifiable Assets Education $ 1,383,555 $ 1,454,520 Television broadcasting 336,396 312,243 Other businesses 743,376 712,161 Corporate office 510,818 484,139 $ 2,974,145 $ 2,963,063 Investments in Marketable Equity Securities 382,777 350,563 Investments in Affiliates 64,815 59,229 Prepaid Pension Cost 1,016,908 979,970 Total Assets $ 4,438,645 $ 4,352,825 |
Education [Member] | |
Segment Reporting Information [Line Items] | |
Summary of Segment Reporting Information, by Operating Segment | The Company’s education division comprises the following operating segments: Three Months Ended Nine Months Ended September 30 September 30 (in thousands) 2016 2015 2016 2015 Operating Revenues Higher education $ 148,602 $ 203,529 $ 472,131 $ 681,814 Test preparation 78,291 83,706 224,102 233,313 Kaplan international 160,456 192,702 512,068 585,486 Kaplan corporate and other 47 1,905 190 5,723 Intersegment elimination (460 ) (96 ) (1,266 ) (363 ) $ 386,936 $ 481,746 $ 1,207,225 $ 1,505,973 Income (Loss) from Operations Higher education $ 11,494 $ 3,153 $ 50,037 $ 28,510 Test preparation 8,588 13,620 13,314 16,365 Kaplan international 1,561 8,295 22,937 33,585 Kaplan corporate and other (5,310 ) (267,882 ) (22,526 ) (328,333 ) Intersegment elimination — 37 (49 ) 95 $ 16,333 $ (242,777 ) $ 63,713 $ (249,778 ) Depreciation of Property, Plant and Equipment Higher education $ 4,157 $ 4,066 $ 12,325 $ 13,688 Test preparation 1,441 2,052 4,837 7,205 Kaplan international 4,360 4,277 13,739 14,004 Kaplan corporate and other 19 242 421 16,248 $ 9,977 $ 10,637 $ 31,322 $ 51,145 Amortization of Intangible Assets $ 1,773 $ 1,339 $ 5,158 $ 4,313 Impairment of Goodwill and Other Long-lived Assets $ — $ 248,591 $ — $ 255,467 Pension Expense Higher education $ 1,905 $ 3,964 $ 5,715 $ 9,028 Test preparation 768 775 2,304 2,325 Kaplan international 67 114 201 326 Kaplan corporate and other 98 2,672 745 3,740 $ 2,838 $ 7,525 $ 8,965 $ 15,419 In the third quarter of 2015, a favorable $3.0 million out of period revenue adjustment was included at the test preparation segment that related to prior periods from 2011 through the second quarter of 2015. With respect to this error, the Company has concluded that it was not material to the Company's financial position or results of operations for 2015 and prior years and the related interim periods, based on its consideration of quantitative and qualitative factors. Asset information for the Company's education division is as follows: As of (in thousands) September 30, December 31, Identifiable assets Higher education $ 227,203 $ 447,282 Test preparation 139,975 134,535 Kaplan international 980,911 826,475 Kaplan corporate and other 35,466 46,228 $ 1,383,555 $ 1,454,520 |
Organization, Basis of Presen32
Organization, Basis of Presentation and Recent Accounting Pronouncements (Organization and Basis of Presentation) (Narrative) (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Sep. 30, 2016TelevisionStation | |
Percentage of ownership indicating control for consolidation purposes | more than 50% | |||
Impairment of goodwill | $ 248.6 | |||
Television Broadcasting [Member] | ||||
Number of television broadcast stations | TelevisionStation | 5 | |||
Education [Member] | ||||
Immaterial Error Correction Amount | $ 4.7 | |||
Education [Member] | Higher Education [Member] | ||||
Impairment of goodwill | $ 248.6 | |||
Q3 2015 [Member] | Education [Member] | Higher Education [Member] | ||||
Immaterial Error Correction Amount | $ 5.6 |
Organization, Basis of Presen33
Organization, Basis of Presentation and Recent Accounting Pronouncements (Recent Accounting Pronouncements) (Narrative) (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
7.25% Unsecured Notes due February 1, 2019 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Unamortized debt issuance costs | $ 0.1 | $ 0.1 |
Debt Instrument, Interest Rate, Stated Percentage | 7.25% | 7.25% |
Deferred Charges and Other Assets [Member] | Accounting Standards Update 2015-03 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Unamortized debt issuance costs | $ (0.1) | |
Long-term Debt [Member] | Accounting Standards Update 2015-03 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Unamortized debt issuance costs | $ 0.1 |
Discontinued Operations (Narrat
Discontinued Operations (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Jan. 31, 2015USD ($)school | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014school | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Pre-tax gain (loss) on sale and/or disposition | $ 0 | $ 732 | ||||
Kaplan International [Member] | Kaplan China [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Pre-tax gain (loss) on sale and/or disposition | $ (700) | |||||
Defined Benefit Pension Plan [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Curtailment gain | $ 0 | 3,267 | $ 0 | 3,267 | ||
Discontinued Operations [Member] | Defined Benefit Pension Plan [Member] | Cable Spin-Off [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Curtailment gain | $ 2,200 | $ 2,200 | ||||
Kaplan International [Member] | Education [Member] | Kaplan China [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Number of schools sold | school | 1 | 3 | ||||
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff [Member] | Discontinued Operations [Member] | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Spin-off Costs | $ 7,400 |
Discontinued Operations (Cash F
Discontinued Operations (Cash Flows from Discontinued Operations) (Details 1) - Cable Spin-Off [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2015 | Sep. 30, 2015 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Net Cash (Used in) Provided by Operating Activities, Discontinued Operations | $ (4,468) | $ 111,665 |
Net Cash Used in Investing Activities, Discontinued Operations | $ 0 | $ (74,416) |
Discontinued Operations (Summar
Discontinued Operations (Summarized Income (Loss) from Discontinued Operations, Net Of Tax) (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | ||||
Operating revenues | $ 0 | $ 397,404 | ||
Operating costs and expenses | 1,662 | (325,379) | ||
Operating income | 1,662 | 72,025 | ||
Non-operating expense | 0 | (1,288) | ||
Income from discontinued operations | 1,662 | 70,737 | ||
Provision for income taxes | 1,283 | 27,783 | ||
Net Income from Discontinued Operations | 379 | 42,954 | ||
Loss on sale of discontinued operations | 0 | (732) | ||
Provision for income taxes on disposition of discontinued operations | 0 | 52 | ||
Income from Discontinued Operations, Net of Tax | $ 0 | $ 379 | $ 0 | $ 42,170 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) - USD ($) | 9 Months Ended | ||||
Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | Jan. 31, 2015 | |
Schedule of Investments [Line Items] | |||||
Commercial paper and money market investments | $ 372,200,000 | $ 433,000,000 | |||
Marketable equity securities | 382,777,000 | $ 350,563,000 | |||
Cash paid for new marketable equity securities | 48,265,000 | $ 135,124,000 | |||
Marketable equity securities purchased | 47,900,000 | 135,600,000 | |||
Gain on sales of marketable equity securities | 6,300,000 | ||||
Proceeds from sales of marketable equity securities | $ 22,800,000 | $ 0 | |||
HomeHero [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 20.00% | ||||
Residential Home Health Illinois [Member] | Residential Healthcare Group Inc [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 40.00% | ||||
Residential Hospice Illinois [Member] | Residential Healthcare Group Inc [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 42.50% | ||||
Residential and a Michigan hospital joint venture [Member] | Residential Healthcare Group Inc [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | |||
Celtic Healthcare Allegheny Health Network Joint Venture [Member] | Celtic Healthcare [Member] | |||||
Schedule of Investments [Line Items] | |||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% |
Investments (Investments in Mar
Investments (Investments in Marketable Equity Securities) (Details 1) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Investments [Abstract] | ||
Total cost | $ 284,343 | $ 253,062 |
Gross unrealized gains | 107,145 | 97,741 |
Gross unrealized losses | (8,711) | (240) |
Total Fair Value | $ 382,777 | $ 350,563 |
Acquisitions and Dispositions39
Acquisitions and Dispositions of Businesses (Acquisitions) (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
May 31, 2016USD ($)TelevisionStation | Sep. 30, 2016USD ($) | Sep. 30, 2016USD ($)business | Sep. 30, 2015business | Feb. 29, 2016 | Jan. 31, 2016 | Dec. 22, 2015 | Nov. 13, 2015business | |
Business Acquisition [Line Items] | ||||||||
Number of businesses acquired | business | 4 | 0 | ||||||
Acqusition purchase price | $ 254,800 | |||||||
Revenues of acquired companies since acquisition date | $ 6,100 | 31,400 | ||||||
Operating income of acquired companies since acquisition date | (2,200) | 6,700 | ||||||
Adjustment to goodwill | $ 20,200 | $ 19,711 | ||||||
Other Businesses [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of businesses acquired | business | 1 | |||||||
Adjustment to goodwill | $ 16,930 | |||||||
Education [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of businesses acquired | business | 3 | |||||||
Adjustment to goodwill | $ 2,781 | |||||||
Education [Member] | Test Preparation [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Adjustment to goodwill | 0 | |||||||
Education [Member] | Higher Education [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Adjustment to goodwill | 2,781 | |||||||
Education [Member] | Kaplan International [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Adjustment to goodwill | 0 | |||||||
Television Broadcasting [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of television stations included in agreement to acquire | TelevisionStation | 2 | |||||||
Payments to acquire businesses per agreement | $ 60,000 | |||||||
Adjustment to goodwill | $ 0 | |||||||
Mander Portman Woodward [Member] | Education [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of interest acquired | 100.00% | |||||||
Osborne Books [Member] | Education [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of interest acquired | 100.00% | |||||||
Group Dekko [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of interest acquired | 100.00% | |||||||
Number of Business Lines | business | 3 | |||||||
Electri-Cable Assemblies [Member] | Other Businesses [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of interest acquired | 100.00% | 100.00% | ||||||
SmartPros [Member] | Education [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of interest acquired | 100.00% | |||||||
2016 Acquisitions [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill expected to be deductible for income tax purposes | $ 20,300 | $ 20,300 |
Acquisitions and Dispositions40
Acquisitions and Dispositions of Businesses (Dispositions) (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2016USD ($) | Jan. 31, 2015school | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($)business | Sep. 30, 2014school | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 03, 2015campus | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Gain on formation of joint ventures | $ 0 | $ 0 | $ 3,232 | $ 5,972 | |||||
Education [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Impairment of long-lived assets | $ 6,900 | ||||||||
Unfavorable out of period expense adjustment | $ (4,700) | ||||||||
Number of businesses disposed | business | 2 | ||||||||
KHE Campuses [Member] | Education [Member] | Higher Education [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Number of nationally accredited ground campuses sold | campus | 38 | ||||||||
Kaplan China [Member] | Education [Member] | Kaplan International [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Number of schools sold | school | 1 | 3 | |||||||
Celtic Healthcare Inc [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Noncontrolling interest exchanged | 20.00% | ||||||||
Celtic Healthcare Inc [Member] | Celtic Healthcare Allegheny Health Network Joint Venture [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | 40.00% | ||||||
Residential Healthcare [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Noncontrolling interest purchased | 20.00% | ||||||||
Noncontrolling Interest, Change in Redemption Value | $ 3,400 | ||||||||
Redeemable Noncontrolling Interest, Redemption Value | $ 24,000 | ||||||||
Residential Healthcare [Member] | Residential and a Michigan hospital joint venture [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Percentage of joint venture sold | 60.00% | ||||||||
Gain on formation of joint ventures | $ 3,200 | ||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | |||||||
Graham Healthcare Group [Member] | |||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||||
Noncontrolling Interest, Change in Redemption Value | $ 4,100 | ||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 10.00% | ||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 90.00% | 90.00% |
Acquisitions and Dispositions41
Acquisitions and Dispositions of Businesses (Assets Acquired and Liabilities Assumed) (Details 1) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Business Acquisition [Line Items] | ||
Goodwill | $ 1,150,446 | $ 1,017,513 |
2016 Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Cash and cash equivalents | 10,587 | |
Accounts receivable | 8,415 | |
Inventory | 971 | |
Other current assets | 1,420 | |
Property, plant and equipment | 3,940 | |
Goodwill | 181,228 | |
Amortized intangible assets | 27,267 | |
Current liabilities | (20,714) | |
Noncurrent liabilities | (11,378) | |
Total | $ 254,846 | |
Weighted Average Life (in years) | 6 years | |
Trade Names and Trademarks [Member] | 2016 Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Indefinite-lived intangible assets | $ 53,110 | |
Student and Customer Relationships [Member] | 2016 Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Amortized intangible assets | $ 22,292 | |
Weighted Average Life (in years) | 6 years | |
Trade Names and Trademarks [Member] | 2016 Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Amortized intangible assets | $ 2,425 | |
Weighted Average Life (in years) | 6 years | |
Non-compete Agreements [Member] | 2016 Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Amortized intangible assets | $ 350 | |
Weighted Average Life (in years) | 2 years | |
Other Intangible Assets [Member] | 2016 Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Amortized intangible assets | $ 2,200 | |
Weighted Average Life (in years) | 7 years |
Acquisitions and Dispositions42
Acquisitions and Dispositions of Businesses (Pro Forma Financials) (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Acquisitions And Dispositions [Abstract] | ||||
Pro Forma Operating revenues | $ 626,223 | $ 696,570 | $ 1,869,174 | $ 2,147,273 |
Pro Forma Net income (loss) | $ 32,400 | $ (229,831) | $ 135,478 | $ (138,545) |
Acquisitions and Dispositions43
Acquisitions and Dispositions of Businesses (Significant Component) (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2015 | Sep. 30, 2015 | |
Acqusitions and Dispositions [Abstract] | ||
Disposal Group, Not Discontinued Operation, Revenue | $ 43,121 | $ 167,244 |
Disposal Group, Not Discontinued Operation, Operating Income (Loss) | $ 629 | $ (6,672) |
Goodwill and Other Intangible44
Goodwill and Other Intangible Assets (Goodwill) (Narrative) (Details) $ in Millions | 3 Months Ended |
Sep. 30, 2015USD ($) | |
Goodwill [Line Items] | |
Goodwill impairment | $ 248.6 |
Education [Member] | Higher Education [Member] | |
Goodwill [Line Items] | |
Goodwill impairment | $ 248.6 |
Goodwill and Other Intangible45
Goodwill and Other Intangible Assets (Intangible Assets) (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Amortization of Intangible Assets | ||||
Amortization of intangible assets | $ 6,620 | $ 4,512 | $ 19,160 | $ 13,897 |
Estimated amortization of intangible assets, remainder of 2016 | 7,000 | 7,000 | ||
Estimated amortization of intangible assets, 2017 | 24,000 | 24,000 | ||
Estimated amortization of intangible assets, 2018 | 22,000 | 22,000 | ||
Estimated amortization of intangible assets, 2019 | 19,000 | 19,000 | ||
Estimated amortization of intangible assets, 2020 | 18,000 | 18,000 | ||
Estimated amortization of intangible assets, after 2020 | $ 25,000 | $ 25,000 |
Goodwill and Other Intangible46
Goodwill and Other Intangible Assets (Changes in Carrying Amount of Goodwill) (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | |
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | $ 1,377,255 | ||
Accumulated impairment losses, beginning balance | (359,742) | ||
Goodwill, net, beginning balance | 1,017,513 | ||
Measurement period adjustments | $ (20,200) | (19,711) | |
Acquisitions | 181,228 | ||
Goodwill impairment | $ 248,600 | ||
Dispositions | (2,800) | ||
Foreign currency exchange rate changes | (25,784) | ||
Goodwill, ending balance | 1,507,378 | 1,507,378 | |
Accumulated impairment losses, ending balance | (356,932) | (356,932) | |
Goodwill, net, ending balance | 1,150,446 | 1,150,446 | |
Education [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 1,006,096 | ||
Accumulated impairment losses, beginning balance | (350,850) | ||
Goodwill, net, beginning balance | 655,246 | ||
Measurement period adjustments | (2,781) | ||
Acquisitions | 160,894 | ||
Dispositions | 0 | ||
Foreign currency exchange rate changes | (25,784) | ||
Goodwill, ending balance | 1,138,425 | 1,138,425 | |
Accumulated impairment losses, ending balance | (350,850) | (350,850) | |
Goodwill, net, ending balance | 787,575 | 787,575 | |
Education [Member] | Higher Education [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 392,457 | ||
Accumulated impairment losses, beginning balance | (248,591) | ||
Goodwill, net, beginning balance | 143,866 | ||
Measurement period adjustments | (2,781) | ||
Acquisitions | 0 | ||
Goodwill impairment | $ 248,600 | ||
Foreign currency exchange rate changes | 104 | ||
Goodwill, ending balance | 389,780 | 389,780 | |
Accumulated impairment losses, ending balance | (248,591) | (248,591) | |
Goodwill, net, ending balance | 141,189 | 141,189 | |
Education [Member] | Test Preparation [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 166,098 | ||
Accumulated impairment losses, beginning balance | (102,259) | ||
Goodwill, net, beginning balance | 63,839 | ||
Measurement period adjustments | 0 | ||
Acquisitions | 0 | ||
Foreign currency exchange rate changes | 0 | ||
Goodwill, ending balance | 166,098 | 166,098 | |
Accumulated impairment losses, ending balance | (102,259) | (102,259) | |
Goodwill, net, ending balance | 63,839 | 63,839 | |
Education [Member] | Kaplan International [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 447,541 | ||
Accumulated impairment losses, beginning balance | 0 | ||
Goodwill, net, beginning balance | 447,541 | ||
Measurement period adjustments | 0 | ||
Acquisitions | 160,894 | ||
Foreign currency exchange rate changes | (25,888) | ||
Goodwill, ending balance | 582,547 | 582,547 | |
Accumulated impairment losses, ending balance | 0 | 0 | |
Goodwill, net, ending balance | 582,547 | 582,547 | |
Television Broadcasting [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 168,345 | ||
Accumulated impairment losses, beginning balance | 0 | ||
Goodwill, net, beginning balance | 168,345 | ||
Measurement period adjustments | 0 | ||
Acquisitions | 0 | ||
Dispositions | 0 | ||
Foreign currency exchange rate changes | 0 | ||
Goodwill, ending balance | 168,345 | 168,345 | |
Accumulated impairment losses, ending balance | 0 | 0 | |
Goodwill, net, ending balance | 168,345 | 168,345 | |
Other Businesses [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 202,814 | ||
Accumulated impairment losses, beginning balance | (8,892) | ||
Goodwill, net, beginning balance | 193,922 | ||
Measurement period adjustments | (16,930) | ||
Acquisitions | 20,334 | ||
Dispositions | (2,800) | ||
Foreign currency exchange rate changes | 0 | ||
Goodwill, ending balance | 200,608 | 200,608 | |
Accumulated impairment losses, ending balance | (6,082) | (6,082) | |
Goodwill, net, ending balance | $ 194,526 | $ 194,526 |
Goodwill and Other Intangible47
Goodwill and Other Intangible Assets (Other Intangible Assets) (Details 2) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | ||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 204,348 | $ 178,747 | |
Accumulated Amortization | 89,712 | 71,556 | |
Net Carrying Amount | 114,636 | 107,191 | |
Indefinite-Lived Intangible Assets [Line Items] | |||
Indefinite-Lived Intangible Assets, Net | 68,780 | 21,885 | |
Trade Names and Trademarks [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Indefinite-Lived Intangible Assets, Net | 67,946 | 21,051 | |
Licensure and Accreditation [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Indefinite-Lived Intangible Assets, Net | 834 | 834 | |
Student and Customer Relationships [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | 130,264 | 108,806 | |
Accumulated Amortization | 51,902 | 40,280 | |
Net Carrying Amount | $ 78,362 | $ 68,526 | |
Student and Customer Relationships [Member] | Minimum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 2 years | 2 years | |
Student and Customer Relationships [Member] | Maximum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 10 years | 10 years | |
Trade Names and Trademarks [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 55,705 | $ 53,848 | |
Accumulated Amortization | 27,929 | 23,941 | |
Net Carrying Amount | $ 27,776 | $ 29,907 | |
Trade Names and Trademarks [Member] | Minimum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 2 years | 2 years | |
Trade Names and Trademarks [Member] | Maximum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 10 years | 10 years | |
Databases and Technology [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 4,617 | $ 4,617 | |
Accumulated Amortization | 4,304 | 4,114 | |
Net Carrying Amount | $ 313 | $ 503 | |
Databases and Technology [Member] | Minimum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 3 years | 3 years | |
Databases and Technology [Member] | Maximum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 5 years | 5 years | |
Non-compete Agreements [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 1,731 | $ 1,381 | |
Accumulated Amortization | 1,273 | 1,012 | |
Net Carrying Amount | $ 458 | $ 369 | |
Non-compete Agreements [Member] | Minimum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 2 years | 2 years | |
Non-compete Agreements [Member] | Maximum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 5 years | 5 years | |
Other [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 12,031 | $ 10,095 | |
Accumulated Amortization | 4,304 | 2,209 | |
Net Carrying Amount | $ 7,727 | $ 7,886 | |
Other [Member] | Minimum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | [1] | 1 year | 1 year |
Other [Member] | Maximum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | [1] | 8 years | 7 years |
[1] | The Company's other amortized intangible assets’ maximum useful life was 7 years as of December 31, 2015. |
Debt (Narrative) (Details)
Debt (Narrative) (Details) | Jul. 25, 2016GBP (£) | Jul. 14, 2016GBP (£) | Jun. 29, 2015USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) | |
Debt Instrument [Line Items] | |||||||||
Average borrowings outstanding | $ 473,700,000 | $ 404,100,000 | $ 429,400,000 | $ 435,800,000 | |||||
Weighted average interest rate of borrowings | 6.20% | 7.20% | 6.90% | 7.00% | |||||
Net interest expense incurred | $ 7,900,000 | $ 7,300,000 | $ 22,500,000 | $ 23,300,000 | |||||
7.25% Unsecured Notes due February 1, 2019 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 7.25% | 7.25% | 7.25% | ||||||
Fair value of debt instrument | $ 436,300,000 | $ 436,300,000 | $ 436,600,000 | ||||||
Carrying value of debt instrument | [1] | $ 398,938,000 | $ 398,938,000 | 398,596,000 | |||||
Other Indebtedness [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Maturity year, start | Dec. 31, 2019 | ||||||||
Debt Instrument, Maturity year, end | Dec. 31, 2025 | ||||||||
Other Indebtedness [Member] | Minimum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.00% | 2.00% | |||||||
Other Indebtedness [Member] | Maximum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | 6.00% | |||||||
Five-Year Revolving Credit Agreement dated June 29, 2015 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of Credit Facility, Current Borrowing Capacity | $ 200,000,000 | ||||||||
Debt Instrument, Term | 5 years | ||||||||
Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowings outstanding | [2] | $ 96,984,000 | $ 96,984,000 | $ 0 | |||||
Education [Member] | Interest Rate Swap [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Derivative, Fixed Interest Rate | 0.51% | ||||||||
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate | 2.01% | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | ||||||||
Derivative, Notional Amount | £ | £ 75,000,000 | ||||||||
Education [Member] | Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of Credit Facility, Current Borrowing Capacity | £ | £ 75,000,000 | ||||||||
Debt Instrument, Term | 4 years | ||||||||
Borrowings outstanding | £ | £ 75,000,000 | ||||||||
Education [Member] | Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | Debt Instrument, Redemption, first anniversary [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument Price Percentage Of Outstanding Balance Redeemed | 6.66% | ||||||||
Education [Member] | Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | Debt Instrument, Redemption, second anniversary [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument Price Percentage Of Outstanding Balance Redeemed | 6.66% | ||||||||
Education [Member] | Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | Debt Instrument, Redemption, third anniversary [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument Price Percentage Of Outstanding Balance Redeemed | 6.66% | ||||||||
Education [Member] | Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||||||||
Education [Member] | Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | ||||||||
[1] | The carrying value is net of $0.1 million of unamortized debt issuance costs as of September 30, 2016 and December 31, 2015, respectively. | ||||||||
[2] | The carrying value is net of $0.6 million of unamortized debt issuance costs as of September 30, 2016 |
Debt (Details 1)
Debt (Details 1) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 | |
Debt Instrument [Line Items] | |||
Other indebtedness | $ 1,486 | $ 1,204 | |
Total Debt | 497,408 | 399,800 | |
Less: current portion | (6,498) | 0 | |
Total Long-Term Debt | 490,910 | 399,800 | |
7.25% Unsecured Notes due February 1, 2019 [Member] | |||
Debt Instrument [Line Items] | |||
Unsecured notes | [1] | $ 398,938 | $ 398,596 |
Debt Instrument, Interest Rate, Stated Percentage | 7.25% | 7.25% | |
Unamortized debt issuance costs | $ 100 | $ 100 | |
Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | |||
Debt Instrument [Line Items] | |||
UK Credit Facility | [2] | 96,984 | $ 0 |
Unamortized debt issuance costs | $ 600 | ||
[1] | The carrying value is net of $0.1 million of unamortized debt issuance costs as of September 30, 2016 and December 31, 2015, respectively. | ||
[2] | The carrying value is net of $0.6 million of unamortized debt issuance costs as of September 30, 2016 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loss on write-downs of cost method investments | $ (15,000) | $ (1,114) | $ (15,161) | $ (1,364) | |
Impairment of goodwill | $ 248,600 | ||||
Impairment of long-lived assets | $ 6,900 | ||||
Vocational School Company [Member] | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Loss on write-downs of cost method investments | $ (15,000) |
Fair Value Measurements (Detail
Fair Value Measurements (Details 1) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 | |
Assets | |||
Marketable equity securities | $ 382,777 | $ 350,563 | |
7.25% Unsecured Notes due February 1, 2019 [Member] | |||
Liabilities | |||
Debt instrument | 436,300 | 436,600 | |
Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Money market investments | [1] | 281,386 | 433,040 |
Commercial paper | [2] | 90,835 | |
Marketable equity securities | [3] | 382,777 | 350,563 |
Other current investments | [4] | 25,893 | 28,882 |
Interest Rate Swap | [5] | 51 | |
Total Financial Assets | 780,942 | 812,485 | |
Liabilities | |||
Deferred compensation plan liabilities | [6] | 45,431 | 48,055 |
Mandatorily redeemable noncontrolling interest | [7] | 9,847 | |
Total Financial Liabilities | 55,278 | ||
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | |||
Assets | |||
Money market investments | [1] | 0 | 0 |
Commercial paper | [2] | 90,835 | |
Marketable equity securities | [3] | 382,777 | 350,563 |
Other current investments | [4] | 9,746 | 12,822 |
Interest Rate Swap | [5] | 0 | |
Total Financial Assets | 483,358 | 363,385 | |
Liabilities | |||
Deferred compensation plan liabilities | [6] | 0 | 0 |
Mandatorily redeemable noncontrolling interest | [7] | 0 | |
Total Financial Liabilities | 0 | ||
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | |||
Assets | |||
Money market investments | [1] | 281,386 | 433,040 |
Commercial paper | [2] | 0 | |
Marketable equity securities | [3] | 0 | 0 |
Other current investments | [4] | 16,147 | 16,060 |
Interest Rate Swap | [5] | 51 | |
Total Financial Assets | 297,584 | 449,100 | |
Liabilities | |||
Deferred compensation plan liabilities | [6] | 45,431 | $ 48,055 |
Mandatorily redeemable noncontrolling interest | [7] | 0 | |
Total Financial Liabilities | 45,431 | ||
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | |||
Assets | |||
Money market investments | [1] | 0 | |
Commercial paper | [2] | 0 | |
Marketable equity securities | [3] | 0 | |
Other current investments | [4] | 0 | |
Interest Rate Swap | [5] | 0 | |
Total Financial Assets | 0 | ||
Liabilities | |||
Deferred compensation plan liabilities | [6] | 0 | |
Mandatorily redeemable noncontrolling interest | [7] | 9,847 | |
Total Financial Liabilities | $ 9,847 | ||
[1] | The Company’s money market investments are included in cash, cash equivalents and restricted cash and the value considers the liquidity of the counterparty. | ||
[2] | The Company's commercial paper investments with original maturities of three months or less are included in cash and cash equivalents. | ||
[3] | The Company’s investments in marketable equity securities are classified as available-for-sale. | ||
[4] | 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 valuation hierarchy. | ||
[5] | Included in Deferred charges and other assets. The fair value 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. | ||
[6] | 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. | ||
[7] | The fair value of the mandatorily redeemable noncontrolling interest is based on an EBITDA multiple, adjusted for working capital and other items, which approximates fair value. |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2016 | |
Income Taxes [Line Items] | ||||
Effective income tax rate | 28.90% | 4.90% | ||
Deferred tax assets written off related to investment in subsidiaries | $ 11 | $ 11 | ||
Revision Adjustment [Member] | ||||
Income Taxes [Line Items] | ||||
Deferred tax assets adjustment related to goodwill | $ 5.6 | |||
Australian Taxation Office [Member] | ||||
Income Taxes [Line Items] | ||||
Change in deferred tax assets valuation allowance | $ 19.3 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Dividends declared per common share | $ 1.21 | $ 1.15 | $ 4.84 | $ 9.10 |
Stock Option Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Antidilutive securities, shares | 102,000 | 77,258 | 102,000 | 77,258 |
Restricted Stock Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Antidilutive securities, shares | 6,100 | 5,050 | 6,100 | 5,050 |
Earnings Per Share (Details 1)
Earnings Per Share (Details 1) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Schedule of Earnings Per Share, Basic and Diluted, Including Two Class Method [Line Items] | ||||
Income (loss) from continuing operations attributable to Graham Holdings Company common stockholders | $ 33,126 | $ (231,222) | $ 131,672 | $ (194,625) |
Less: Dividends paid-common stock outstanding and unvested restricted shares | (6,796) | (6,736) | (27,329) | (53,090) |
Undistributed earnings (loss) | $ 26,330 | $ (237,958) | $ 104,343 | $ (247,715) |
Percent allocated to common stockholders | 98.70% | 100.00% | 98.70% | 100.00% |
Undistributed Earnings (Loss) Allocated To Common Stockholders | $ 25,987 | $ (237,958) | $ 102,987 | $ (247,715) |
Add: Dividends paid-common stock outstanding | 6,708 | 6,621 | 26,976 | 52,180 |
Numerator for basic earnings (loss) per share | 32,695 | (231,337) | 129,963 | (195,535) |
Add: Additional undistributed earnings due to dilutive stock options | 2 | 0 | 7 | 0 |
Numerator for diluted earnings (loss) per share | $ 32,697 | $ (231,337) | $ 129,970 | $ (195,535) |
Weighted average shares outstanding (shares) | 5,544 | 5,738 | 5,570 | 5,721 |
Denominator for diluted earnings (loss) per share (shares) | 5,574 | 5,738 | 5,600 | 5,721 |
Graham Holdings Company Common Stockholders: | ||||
Basic income (loss) per common share from continuing operations in dollars per share | $ 5.90 | $ (40.32) | $ 23.33 | $ (34.18) |
Diluted income (loss) per common share from continuing operations in dollars per share | $ 5.87 | $ (40.32) | $ 23.21 | $ (34.18) |
Stock Option Plan [Member] | ||||
Schedule of Earnings Per Share, Basic and Diluted, Including Two Class Method [Line Items] | ||||
Add: Effect of dilutive stock options (shares) | 30 | 0 | 30 | 0 |
Earnings Per Share (Details 2)
Earnings Per Share (Details 2) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Earnings Per Share [Abstract] | ||||
Weighted average restricted stock | 42 | 50 | 40 | 53 |
Weighted average stock options | 0 | 49 | 0 | 37 |
Pension and Postretirement Pl56
Pension and Postretirement Plans (Narrative) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016USD ($)Investmentcompanies | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)Investmentcompanies | Sep. 30, 2016USD ($)Investmentcompanies | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($)Investment | |
Retirement Benefits Disclosure [Line Items] | ||||||
Net Periodic Cost (Benefit) | $ (36,714) | $ (45,081) | ||||
Early retirement program expense | 0 | 3,734 | ||||
Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Net Periodic Cost (Benefit) | $ (12,389) | $ (20,045) | (36,714) | (42,917) | ||
Curtailment gain | 0 | 3,267 | 0 | 3,267 | ||
Early retirement program expense | $ 0 | 3,734 | $ 0 | 3,734 | ||
Percent of plan assets managed internally by the company | 44.00% | |||||
Percent of plan assets managed by investment companies | 56.00% | |||||
Number of investment companies actively managing plan assets | companies | 2 | 2 | 2 | |||
Percentage of total plan assets | 100.00% | 100.00% | 100.00% | 100.00% | ||
Defined Benefit Pension Plan [Member] | Sale of KHE Campuses business [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Curtailment gain | 1,100 | 1,100 | ||||
Defined Benefit Pension Plan [Member] | Discontinued Operations [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Net Periodic Cost (Benefit) | 100 | 1,900 | ||||
Defined Benefit Pension Plan [Member] | Discontinued Operations [Member] | Cable Spin-Off [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Curtailment gain | 2,200 | 2,200 | ||||
Defined Benefit Pension Plan [Member] | Separation Incentive Program [Member] | Education [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Early retirement program expense | 3,700 | |||||
Supplemental Executive Retirement Plan (SERP) [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Net Periodic Cost (Benefit) | $ 2,121 | 2,349 | $ 6,363 | 7,620 | ||
Supplemental Executive Retirement Plan (SERP) [Member] | Discontinued Operations [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Net Periodic Cost (Benefit) | 200 | |||||
Other Postretirement Plans [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Net Periodic Cost (Benefit) | 195 | $ 283 | $ 584 | $ 849 | ||
Berkshire Hathaway Common Stock [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Defined benefit plan, target allocation maximum percentage of assets, singular equity security, without prior approval by plan administrator | 20.00% | |||||
Foreign Investments [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Defined benefit plan, target allocation maximum percentage of assets, equity securities | 23.00% | |||||
Fixed income securities [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Defined benefit plan, target allocation percentage of assets, fixed-income securities, range minimum | 10.00% | |||||
Single Equity Concentration [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Defined benefit plan, target allocation maximum percentage of assets, singular equity security, without prior approval by plan administrator | 10.00% | |||||
Value of investments | $ 915,200 | $ 915,200 | $ 915,200 | $ 562,600 | ||
Percentage of total plan assets | 45.00% | 45.00% | 45.00% | 25.00% | ||
Single Equity Concentration [Member] | Equity Securities [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Number of investments the company's pension plan held which individually exceed 10% of total plan assets | Investment | 1 | 1 | 1 | 2 | ||
Single Equity Concentration [Member] | Equity Funds [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Number of investments the company's pension plan held which individually exceed 10% of total plan assets | Investment | 1 | 1 | 1 | |||
Concentration In Single Entity, Type Of Industry, Foreign Country Or Individual Fund [Member] | Defined Benefit Plan Assets Total [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Minimum percentage of plan assets considered as significant concentrations in pension plans | 10.00% | 10.00% | ||||
Geographic Concentration [Member] | Foreign Investments [Member] | Defined Benefit Pension Plan [Member] | ||||||
Retirement Benefits Disclosure [Line Items] | ||||||
Value of investments | $ 332,400 | |||||
Percentage of total plan assets | 15.00% | |||||
Number of foreign countries for which the companys pension plan holds investments that exceed 10% of total plan assets | Investment | 1 |
Pension and Postretirement Pl57
Pension and Postretirement Plans (Total Benefit/Cost) (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Net Periodic Cost (Benefit) | $ (36,714) | $ (45,081) | ||
Early retirement programs and special separation benefit expense | 0 | 3,734 | ||
Total Cost (Benefit) | $ (12,389) | $ (16,255) | (36,714) | (41,077) |
Defined Benefit Pension Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 5,040 | 6,090 | 15,422 | 20,593 |
Interest cost | 12,845 | 13,516 | 38,763 | 39,077 |
Expected return on assets | (30,348) | (33,673) | (91,122) | (96,771) |
Amortization of prior service cost (credit) | 74 | 79 | 223 | 241 |
Recognized actuarial loss (gain) | 0 | (6,057) | 0 | (6,057) |
Net Periodic Cost (Benefit) | (12,389) | (20,045) | (36,714) | (42,917) |
Curtailment gain | 0 | (3,267) | 0 | (3,267) |
Early retirement programs and special separation benefit expense | 0 | 3,734 | 0 | 3,734 |
Total Cost (Benefit) | (12,389) | (19,578) | (36,714) | (42,450) |
Supplemental Executive Retirement Plan (SERP) [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 246 | 464 | 738 | 1,482 |
Interest cost | 1,096 | 1,140 | 3,288 | 3,410 |
Amortization of prior service cost (credit) | 114 | 115 | 342 | 343 |
Recognized actuarial loss (gain) | 665 | 630 | 1,995 | 2,385 |
Net Periodic Cost (Benefit) | 2,121 | 2,349 | 6,363 | 7,620 |
Other Postretirement Plans [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 346 | 333 | 1,039 | 999 |
Interest cost | 308 | 325 | 923 | 974 |
Amortization of prior service cost (credit) | (83) | (126) | (251) | (377) |
Recognized actuarial loss (gain) | (376) | (249) | (1,127) | (747) |
Net Periodic Cost (Benefit) | $ 195 | 283 | $ 584 | 849 |
Discontinued Operations [Member] | Defined Benefit Pension Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Net Periodic Cost (Benefit) | $ 100 | 1,900 | ||
Discontinued Operations [Member] | Supplemental Executive Retirement Plan (SERP) [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Net Periodic Cost (Benefit) | $ 200 |
Pension and Postretirement Pl58
Pension and Postretirement Plans (Asset Allocation) (Details 2) - Defined Benefit Pension Plans [Member] | Sep. 30, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 100.00% | 100.00% |
U.S. | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 78.00% | 62.00% |
U.S. | Fixed income securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 15.00% | 13.00% |
International [Member] | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 7.00% | 25.00% |
Other Non-Operating Income (Nar
Other Non-Operating Income (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2016USD ($) | Jan. 31, 2015USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($)business | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | |
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Document Fiscal Year Focus | 2,016 | ||||||||
Gain on sale of land | $ 0 | $ 34,100 | $ 0 | $ 34,072 | $ 0 | ||||
Loss on write-downs of cost method investments | (15,000) | (1,114) | (15,161) | (1,364) | |||||
Gain (loss) on sales of businesses | 0 | (26,253) | $ 2,900 | 18,931 | (23,335) | ||||
Gain on formation of joint ventures | $ 0 | 0 | $ 3,232 | $ 5,972 | |||||
Celtic Healthcare Inc [Member] | Celtic Healthcare Allegheny Health Network Joint Venture [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Gain on formation of joint ventures | $ 6,000 | ||||||||
Classified Ventures LLC [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Favorable out of period adjustment | $ 4,800 | ||||||||
Residential Healthcare [Member] | Residential and a Michigan hospital joint venture [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | |||||||
Gain on formation of joint ventures | $ 3,200 | ||||||||
Education [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Gain (loss) on sales of businesses | $ 26,300 | ||||||||
Number of businesses disposed | business | 2 | ||||||||
Favorable out of period adjustment | $ 4,700 | ||||||||
Celtic Healthcare Allegheny Health Network Joint Venture [Member] | Celtic Healthcare Inc [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | 40.00% | ||||||
Residential and a Michigan hospital joint venture [Member] | Residential Healthcare [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | 40.00% | 40.00% | |||||
Vocational School Company [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Loss on write-downs of cost method investments | $ (15,000) | ||||||||
Kaplan Corporate and Other [Member] | Education [Member] | Colloquy [Member] | |||||||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||||||
Gain (loss) on sales of businesses | $ 18,900 |
Other Non-Operating Income (Det
Other Non-Operating Income (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2016 | Jun. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Schedule of Non-Operating Income (Expense) [Line Items] | ||||||
Gain on sale of land | $ 0 | $ 34,100 | $ 0 | $ 34,072 | $ 0 | |
Foreign currency loss, net | (3,797) | (12,972) | (33,324) | (16,191) | ||
Gain (loss) on sales of businesses | 0 | (26,253) | $ 2,900 | 18,931 | (23,335) | |
Loss on write-downs of cost method investments | (15,000) | (1,114) | (15,161) | (1,364) | ||
Gain on sales of marketable equity securities (see Note 3) | 0 | 0 | 6,256 | 0 | ||
Gain on formation of joint ventures | 0 | 0 | 3,232 | 5,972 | ||
Additional gain on sale of Classified Ventures | 0 | 4,827 | ||||
Other, net | 572 | (119) | 1,865 | 206 | ||
Total Other Non-Operating (Expense) Income | (18,225) | (40,458) | 15,871 | (29,885) | ||
Classified Ventures LLC [Member] | ||||||
Schedule of Non-Operating Income (Expense) [Line Items] | ||||||
Additional gain on sale of Classified Ventures | $ 0 | 0 | $ 0 | $ 4,827 | ||
Education [Member] | ||||||
Schedule of Non-Operating Income (Expense) [Line Items] | ||||||
Gain (loss) on sales of businesses | $ 26,300 |
Accumulated Other Comprehensi61
Accumulated Other Comprehensive Income (Loss) (Components of OCI) (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | ||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before tax | $ 12,244 | $ (4,840) | $ 536 | $ (30,962) | |
Other Comprehensive Income (Loss), income tax | (5,039) | 127 | (866) | 7,632 | |
Other Comprehensive Loss, Net of Tax | 7,205 | (4,713) | (330) | (23,330) | |
Foreign Currency Translation Adjustment [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | (353) | (10,548) | (1,629) | (17,387) | |
Other Comprehensive Income (Loss) before Reclassifications, Tax | 0 | 0 | 0 | 0 | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (353) | (10,548) | (1,629) | (17,387) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | 6,026 | 0 | 5,501 | |
Reclassification from AOCI, Current Period, Tax | 0 | 0 | 0 | 0 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 6,026 | 0 | 5,501 | |
Other Comprehensive Income (Loss), before tax | (353) | (4,522) | (1,629) | (11,886) | |
Other Comprehensive Income (Loss), income tax | 0 | 0 | 0 | 0 | |
Other Comprehensive Loss, Net of Tax | (353) | (4,522) | (1,629) | (11,886) | |
Unrealized Gains (Losses) on Available-for-Sale Securities [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | 12,154 | 3,836 | 7,190 | (16,497) | |
Other Comprehensive Income (Loss) before Reclassifications, Tax | (4,862) | (1,535) | (2,876) | 6,599 | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 7,292 | 2,301 | 4,314 | (9,898) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (6,256) | 0 | |||
Reclassification from AOCI, Current Period, Tax | 2,502 | 0 | |||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (3,754) | 0 | |||
Other Comprehensive Income (Loss), before tax | 934 | (16,497) | |||
Other Comprehensive Income (Loss), income tax | (374) | 6,599 | |||
Other Comprehensive Loss, Net of Tax | 560 | (9,898) | |||
Pension and Other Postretirement Plans [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 0 | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 394 | (5,557) | 1,182 | (4,161) | |
Reclassification from AOCI, Current Period, Tax | (157) | 2,223 | (472) | 1,665 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 237 | (3,334) | 710 | (2,496) | |
Other Comprehensive Income (Loss), before tax | 394 | (4,154) | 1,182 | (2,758) | |
Other Comprehensive Income (Loss), income tax | (157) | 1,662 | (472) | 1,104 | |
Other Comprehensive Loss, Net of Tax | 237 | (2,492) | 710 | (1,654) | |
Net Prior Service Cost [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | [1] | 105 | 68 | 314 | 207 |
Reclassification from AOCI, Current Period, Tax | (41) | (27) | (125) | (82) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 64 | 41 | 189 | 125 | |
Net Actuarial Loss [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | [1] | 289 | (5,676) | 868 | (4,419) |
Reclassification from AOCI, Current Period, Tax | (116) | 2,271 | (347) | 1,768 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 173 | (3,405) | 521 | (2,651) | |
Curtailment Gains Included In Net Income [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | [1] | 0 | 51 | 0 | 51 |
Reclassification from AOCI, Current Period, Tax | 0 | (21) | 0 | (21) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 30 | 0 | 30 | |
Curtailment And Settlement Included In Distribution [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | 0 | 1,403 | 0 | 1,403 | |
Other Comprehensive Income (Loss) before Reclassifications, Tax | 0 | (561) | 0 | (561) | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 0 | 842 | 0 | 842 | |
Cash Flow Hedge [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 31 | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (2) | ||||
Other Comprehensive Income (Loss), before tax | 49 | 0 | 49 | 179 | |
Other Comprehensive Income (Loss), income tax | (20) | 0 | (20) | (71) | |
Other Comprehensive Loss, Net of Tax | $ 29 | $ 0 | $ 29 | $ 108 | |
[1] | These accumulated other comprehensive income components are included in the computation of net periodic pension and postretirement plan cost (see Note 10). |
Accumulated Other Comprehensi62
Accumulated Other Comprehensive Income (Loss) (AOCI balances) (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income, beginning balance | $ 2,490,698 | |||
Other Comprehensive Income (Loss), Net of Tax | $ 7,205 | $ (4,713) | (330) | $ (23,330) |
Accumulated Other Comprehensive Income, ending balance | 2,508,799 | 2,508,799 | ||
AOCI Including Portion Attributable to Noncontrolling Interest [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income, beginning balance | 314,680 | |||
Other comprehensive (loss) income before reclassifications | 2,716 | |||
Net amount reclassified from accumulated other comprehensive income | (3,046) | |||
Other Comprehensive Income (Loss), Net of Tax | (330) | |||
Accumulated Other Comprehensive Income, ending balance | 314,350 | 314,350 | ||
Cumulative Foreign Currency Translation Adjustment [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income, beginning balance | (4,849) | |||
Other comprehensive (loss) income before reclassifications | (353) | (10,548) | (1,629) | (17,387) |
Net amount reclassified from accumulated other comprehensive income | 0 | 6,026 | 0 | 5,501 |
Other Comprehensive Income (Loss), Net of Tax | (353) | (4,522) | (1,629) | (11,886) |
Accumulated Other Comprehensive Income, ending balance | (6,478) | (6,478) | ||
Unrealized Gain on Available-for-Sale Securities [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income, beginning balance | 58,500 | |||
Other comprehensive (loss) income before reclassifications | 7,292 | 2,301 | 4,314 | (9,898) |
Net amount reclassified from accumulated other comprehensive income | (3,754) | 0 | ||
Other Comprehensive Income (Loss), Net of Tax | 560 | (9,898) | ||
Accumulated Other Comprehensive Income, ending balance | 59,060 | 59,060 | ||
Unrealized Gain on Pensions and Other Postretirement Plans [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income, beginning balance | 261,029 | |||
Other comprehensive (loss) income before reclassifications | 0 | |||
Net amount reclassified from accumulated other comprehensive income | 237 | (3,334) | 710 | (2,496) |
Other Comprehensive Income (Loss), Net of Tax | 237 | (2,492) | 710 | (1,654) |
Accumulated Other Comprehensive Income, ending balance | 261,739 | 261,739 | ||
Cash Flow Hedge [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income, beginning balance | 0 | |||
Other comprehensive (loss) income before reclassifications | 31 | |||
Net amount reclassified from accumulated other comprehensive income | (2) | |||
Other Comprehensive Income (Loss), Net of Tax | 29 | $ 0 | 29 | $ 108 |
Accumulated Other Comprehensive Income, ending balance | $ 29 | $ 29 |
Accumulated Other Comprehensi63
Accumulated Other Comprehensive Income (Loss) (Reclassifications out of AOCI) (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | ||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Other (expense) income, net | $ 18,225 | $ 40,458 | $ (15,871) | $ 29,885 | |
Interest expense | 8,614 | 7,830 | 24,533 | 24,679 | |
Provision (Benefit) for Income Taxes | 7,800 | (30,500) | 54,000 | (10,000) | |
Income Net of Tax | (33,126) | 230,935 | (132,540) | 192,499 | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Income Net of Tax | 235 | 2,692 | (3,046) | 3,084 | |
Foreign Currency Translation Adjustment [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | 0 | 6,026 | 0 | 5,501 | |
Provision (Benefit) for Income Tax | 0 | 0 | 0 | 0 | |
Reclassifications, net of tax | 0 | 6,026 | 0 | 5,501 | |
Foreign Currency Translation Adjustment [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Other (expense) income, net | 0 | 6,026 | 0 | 5,501 | |
Unrealized Gain on Available-for-Sale Securities [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | (6,256) | 0 | |||
Provision (Benefit) for Income Tax | 2,502 | 0 | |||
Reclassifications, net of tax | (3,754) | 0 | |||
Unrealized Gain on Available-for-Sale Securities [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Other (expense) income, net | 0 | 0 | (6,256) | 0 | |
Provision (Benefit) for Income Taxes | 0 | 0 | 2,502 | 0 | |
Income Net of Tax | 0 | 0 | (3,754) | 0 | |
Pension and Other Postretirement Plans [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | 394 | (5,557) | 1,182 | (4,161) | |
Provision (Benefit) for Income Tax | (157) | 2,223 | (472) | 1,665 | |
Reclassifications, net of tax | 237 | (3,334) | 710 | (2,496) | |
Net Prior Service Cost [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | [1] | 105 | 68 | 314 | 207 |
Provision (Benefit) for Income Tax | (41) | (27) | (125) | (82) | |
Reclassifications, net of tax | 64 | 41 | 189 | 125 | |
Net Actuarial Loss [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | [1] | 289 | (5,676) | 868 | (4,419) |
Provision (Benefit) for Income Tax | (116) | 2,271 | (347) | 1,768 | |
Reclassifications, net of tax | 173 | (3,405) | 521 | (2,651) | |
Curtailment Gains Included In Net Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | [1] | 0 | 51 | 0 | 51 |
Provision (Benefit) for Income Tax | 0 | (21) | 0 | (21) | |
Reclassifications, net of tax | 0 | 30 | 0 | 30 | |
Cash Flow Hedge [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, net of tax | (2) | ||||
Cash Flow Hedge [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | (3) | 0 | (3) | 132 | |
Provision (Benefit) for Income Taxes | 1 | 0 | 1 | (53) | |
Income Net of Tax | $ (2) | $ 0 | $ (2) | $ 79 | |
[1] | These accumulated other comprehensive income components are included in the computation of net periodic pension and postretirement plan cost (see Note 10). |
Contingencies (Details)
Contingencies (Details) report in Thousands | Jul. 20, 2016report | Aug. 31, 2016 | Mar. 31, 2015claim | Aug. 31, 2011claimComplaint | Sep. 30, 2016claimCaseprogram_review |
Loss Contingencies [Line Items] | |||||
Number of existing legal claims or proceedings that are likely to have a material effect on the Company's business | 0 | ||||
Title IV participating institutions including Broomall PA and Pittsburgh PA [Member] | Education [Member] | Higher Education [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of pending program reviews | program_review | 5 | ||||
Title IV participating institutions including Broomall PA and Pittsburgh PA [Member] | Education [Member] | Sale of KHE Campuses business [Member] | Higher Education [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of pending program reviews | program_review | 4 | ||||
Number Of Preliminary Program Review Reports received | report | 2 | ||||
Length of program review | 2 years | ||||
Kaplan University [Member] | Education [Member] | Higher Education [Member] | |||||
Loss Contingencies [Line Items] | |||||
Length of accreditation term reaffirmed | 10 years | ||||
Diaz Case [Member] | Education [Member] | |||||
Loss Contingencies [Line Items] | |||||
Separate complaints included In Diaz Case received rulings | Complaint | 3 | ||||
Number of allegations not dismissed | 1 | ||||
Diaz Claims [Member] | Education [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of claims affirmed for dismissal by US Court of Appeal | 3 | ||||
Number of claims appealed | 4 | ||||
Number of claims revered and remanded by US Court of Appeal | 1 | ||||
Urquilla-Diaz And Jajdelski Case [Member] | Education [Member] | |||||
Loss Contingencies [Line Items] | |||||
Number of unsealed cases filed by former employees under the U.S. Federal False Claims Act | Case | 2 |
Business Segments (Narrative) (
Business Segments (Narrative) (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Sep. 30, 2016Segment | |
Business Segments [Line Items] | |||
Number of reportable segments | Segment | 4 | ||
Education [Member] | |||
Business Segments [Line Items] | |||
Immaterial Error Correction Amount | $ 4.7 | ||
Periods from 2011 to Q2 2015 [Member] | Test Preparation [Member] | Reportable Subsegments [Member] | Education [Member] | Operating Segments [Member] | |||
Business Segments [Line Items] | |||
Immaterial Error Correction Amount | $ 3 |
Business Segments (Information
Business Segments (Information by Operating Segment) (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||
Operating Revenues | $ 621,638 | $ 641,432 | $ 1,852,311 | $ 1,969,747 | |
Income (Loss) from Operations | 68,033 | (213,723) | 194,045 | (148,636) | |
Equity in (losses) earnings of affiliates, net | (1,008) | 95 | (895) | (662) | |
Interest Expense, Net | (7,874) | (7,349) | (22,481) | (23,316) | |
Other (expense) income, net | (18,225) | (40,458) | 15,871 | (29,885) | |
Income (loss) from Continuing Operations Before Income Taxes | 40,926 | (261,435) | 186,540 | (202,499) | |
Depreciation of property, plant and equipment | 16,097 | 14,460 | 48,903 | 62,266 | |
Amortization Of Intangible Assets And Impairment Of Goodwill And Other Long-Lived Assets | 6,620 | 253,103 | 19,160 | 269,364 | |
Amortization of intangible assets | 6,620 | 4,512 | 19,160 | 13,897 | |
Net Pension (Credit) Expense | (12,389) | (16,255) | (36,714) | (41,077) | |
Identifiable Assets | 2,974,145 | 2,974,145 | $ 2,963,063 | ||
Investments in Marketable Equity Securities | 382,777 | 382,777 | 350,563 | ||
Investments in Affiliates | 64,815 | 64,815 | 59,229 | ||
Prepaid Pension Cost | 1,016,908 | 1,016,908 | 979,970 | ||
Total Assets | 4,438,645 | 4,438,645 | 4,352,825 | ||
Operating Segments [Member] | Education [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 386,936 | 481,746 | 1,207,225 | 1,505,973 | |
Income (Loss) from Operations | 16,333 | (242,777) | 63,713 | (249,778) | |
Depreciation of property, plant and equipment | 9,977 | 10,637 | 31,322 | 51,145 | |
Amortization Of Intangible Assets And Impairment Of Goodwill And Other Long-Lived Assets | 1,773 | 249,930 | 5,158 | 259,780 | |
Amortization of intangible assets | 1,773 | 1,339 | 5,158 | 4,313 | |
Impairment of Goodwill and Other Long-lived Assets | 0 | 248,591 | 0 | 255,467 | |
Net Pension (Credit) Expense | 2,838 | 7,525 | 8,965 | 15,419 | |
Identifiable Assets | 1,383,555 | 1,383,555 | 1,454,520 | ||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Higher Education [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 148,602 | 203,529 | 472,131 | 681,814 | |
Income (Loss) from Operations | 11,494 | 3,153 | 50,037 | 28,510 | |
Depreciation of property, plant and equipment | 4,157 | 4,066 | 12,325 | 13,688 | |
Net Pension (Credit) Expense | 1,905 | 3,964 | 5,715 | 9,028 | |
Identifiable Assets | 227,203 | 227,203 | 447,282 | ||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Test Preparation [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 78,291 | 83,706 | 224,102 | 233,313 | |
Income (Loss) from Operations | 8,588 | 13,620 | 13,314 | 16,365 | |
Depreciation of property, plant and equipment | 1,441 | 2,052 | 4,837 | 7,205 | |
Net Pension (Credit) Expense | 768 | 775 | 2,304 | 2,325 | |
Identifiable Assets | 139,975 | 139,975 | 134,535 | ||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Kaplan International [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 160,456 | 192,702 | 512,068 | 585,486 | |
Income (Loss) from Operations | 1,561 | 8,295 | 22,937 | 33,585 | |
Depreciation of property, plant and equipment | 4,360 | 4,277 | 13,739 | 14,004 | |
Net Pension (Credit) Expense | 67 | 114 | 201 | 326 | |
Identifiable Assets | 980,911 | 980,911 | 826,475 | ||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Kaplan Corporate and Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 47 | 1,905 | 190 | 5,723 | |
Income (Loss) from Operations | (5,310) | (267,882) | (22,526) | (328,333) | |
Depreciation of property, plant and equipment | 19 | 242 | 421 | 16,248 | |
Net Pension (Credit) Expense | 98 | 2,672 | 745 | 3,740 | |
Identifiable Assets | 35,466 | 35,466 | 46,228 | ||
Operating Segments [Member] | Education [Member] | Intersubsegment Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | (460) | (96) | (1,266) | (363) | |
Income (Loss) from Operations | 0 | 37 | (49) | 95 | |
Operating Segments [Member] | Television Broadcasting [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 112,389 | 89,693 | 300,927 | 264,010 | |
Income (Loss) from Operations | 59,159 | 40,526 | 144,594 | 121,102 | |
Depreciation of property, plant and equipment | 2,540 | 2,237 | 7,367 | 6,471 | |
Amortization Of Intangible Assets And Impairment Of Goodwill And Other Long-Lived Assets | 63 | 63 | 189 | 189 | |
Net Pension (Credit) Expense | 428 | 425 | 1,285 | 1,207 | |
Identifiable Assets | 336,396 | 336,396 | 312,243 | ||
Operating Segments [Member] | Other Segments [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 122,313 | 70,052 | 344,298 | 199,823 | |
Income (Loss) from Operations | (10,801) | (3,059) | (21,593) | (10,382) | |
Depreciation of property, plant and equipment | 3,289 | 1,335 | 9,389 | 3,891 | |
Amortization Of Intangible Assets And Impairment Of Goodwill And Other Long-Lived Assets | 4,784 | 3,110 | 13,813 | 9,395 | |
Net Pension (Credit) Expense | 279 | 328 | 839 | 707 | |
Identifiable Assets | 743,376 | 743,376 | 712,161 | ||
Corporate, Non-Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | 0 | 0 | 0 | 0 | |
Income (Loss) from Operations | 3,342 | (8,413) | 7,331 | (9,578) | |
Depreciation of property, plant and equipment | 291 | 251 | 825 | 759 | |
Amortization Of Intangible Assets And Impairment Of Goodwill And Other Long-Lived Assets | 0 | 0 | 0 | 0 | |
Net Pension (Credit) Expense | (15,934) | (24,533) | (47,803) | (58,410) | |
Identifiable Assets | 510,818 | 510,818 | $ 484,139 | ||
Intersegment Elimination [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Operating Revenues | $ 0 | $ (59) | $ (139) | $ (59) |