Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 26, 2018 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
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 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Class A Common Stock [Member] | ||
Entity Common Stock, Shares Outstanding | 964,001 | |
Class B Common Stock [Member] | ||
Entity Common Stock, Shares Outstanding | 4,337,758 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Statement [Abstract] | ||||
Operating Revenues | $ 674,766 | $ 657,225 | $ 2,006,879 | $ 1,916,029 |
Operating Costs and Expenses [Abstract] | ||||
Operating | 448,920 | 374,987 | 1,254,726 | 1,082,421 |
Selling, general and administrative | 131,081 | 228,051 | 497,504 | 662,313 |
Depreciation of property, plant and equipment | 13,648 | 16,002 | 41,909 | 46,525 |
Amortization of intangible assets | 12,269 | 10,923 | 34,052 | 28,290 |
Impairment of goodwill and other long-lived assets | 8,109 | 312 | 8,109 | 9,536 |
Total Operating Costs and Expenses | 614,027 | 630,275 | 1,836,300 | 1,829,085 |
Income from Operations | 60,739 | 26,950 | 170,579 | 86,944 |
Equity in earnings (losses) of affiliates, net | 9,537 | (532) | 13,047 | 1,448 |
Interest income | 611 | 861 | 3,884 | 3,397 |
Interest expense | (6,135) | (8,619) | (31,371) | (25,783) |
Debt extinguishment costs | 0 | 0 | (11,378) | 0 |
Non-operating pension and postretirement benefit income, net | 22,214 | 17,621 | 66,641 | 55,042 |
Gain on marketable equity securities, net | 44,962 | 0 | 28,306 | 0 |
Other income, net | 3,142 | 1,963 | 14,662 | 6,881 |
Income Before Income Taxes | 135,070 | 38,244 | 254,370 | 127,929 |
Provision for Income Taxes | 10,000 | 13,400 | 39,700 | 40,000 |
Net Income | 125,070 | 24,844 | 214,670 | 87,929 |
Net Income Attributable to Noncontrolling Interests | (6) | (60) | (149) | (63) |
Net Income Attributable to Graham Holdings Company Common Stockholders | $ 125,064 | $ 24,784 | $ 214,521 | $ 87,866 |
Per Share Information Attributable to Graham Holdings Company Common Stockholders | ||||
Basic net income per common share in dollars per share | $ 23.43 | $ 4.45 | $ 39.81 | $ 15.74 |
Basic average number of common shares outstanding in shares | 5,302 | 5,518 | 5,354 | 5,530 |
Diluted net income per common share in dollars per share | $ 23.28 | $ 4.42 | $ 39.54 | $ 15.64 |
Diluted average number of common shares outstanding in shares | 5,337 | 5,554 | 5,390 | 5,567 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 125,070 | $ 24,844 | $ 214,670 | $ 87,929 |
Foreign currency translation adjustments: | ||||
Translation adjustments arising during the period | (2,844) | 11,470 | (22,447) | 34,776 |
Unrealized gains on available-for-sale securities: | ||||
Unrealized gains for the period, net | 0 | 47,836 | 0 | 71,370 |
Pension and other postretirement plans: | ||||
Amortization of net prior service cost included in net income | 69 | 118 | 215 | 358 |
Amortization of net actuarial gain included in net income | (3,295) | (1,567) | (7,956) | (4,958) |
Total pension and other postretirement plans, before tax | (3,226) | (1,449) | (7,741) | (4,600) |
Cash flow hedge (loss) gain | (6) | (72) | 601 | (215) |
Other Comprehensive (Loss) Income, Before Tax | (6,076) | 57,785 | (29,587) | 101,331 |
Income tax benefit (expense) related to items of other comprehensive (loss) income | 874 | (18,540) | 1,976 | (26,665) |
Other Comprehensive (Loss) Income, Net of Tax | (5,202) | 39,245 | (27,611) | 74,666 |
Comprehensive Income | 119,868 | 64,089 | 187,059 | 162,595 |
Comprehensive income attributable to noncontrolling interests | (6) | (60) | (149) | (63) |
Total Comprehensive Income Attributable to Graham Holdings Company | $ 119,862 | $ 64,029 | $ 186,910 | $ 162,532 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 265,159 | $ 390,014 |
Restricted cash | 11,576 | 17,552 |
Investments in marketable equity securities and other investments | 517,927 | 557,153 |
Accounts receivable, net | 589,645 | 620,319 |
Income taxes receivable | 0 | 23,901 |
Inventories and contracts in progress | 73,696 | 60,612 |
Other current assets | 77,864 | 66,253 |
Total Current Assets | 1,535,867 | 1,735,804 |
Property, Plant and Equipment, Net | 271,560 | 259,358 |
Investments in Affiliates | 142,756 | 128,590 |
Goodwill, Net | 1,310,075 | 1,299,710 |
Indefinite-Lived Intangible Assets | 114,752 | 102,195 |
Amortized Intangible Assets, Net | 260,055 | 237,976 |
Prepaid Pension Cost | 1,106,162 | 1,056,777 |
Deferred Income Taxes | 15,367 | 15,367 |
Deferred Charges and Other Assets | 117,149 | 102,046 |
Total Assets | 4,873,743 | 4,937,823 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 448,240 | 526,323 |
Deferred revenue | 335,086 | 339,454 |
Income taxes payable | 7,235 | 6,109 |
Current portion of long-term debt | 6,568 | 6,726 |
Dividends declared | 7,071 | 0 |
Total Current Liabilities | 804,200 | 878,612 |
Postretirement Benefits Other Than Pensions | 21,607 | 20,865 |
Accrued Compensation and Related Benefits | 179,887 | 193,024 |
Other Liabilities | 59,264 | 65,977 |
Deferred Income Taxes | 355,662 | 362,701 |
Mandatorily Redeemable Noncontrolling Interest | 0 | 10,331 |
Long-Term Debt | 473,060 | 486,561 |
Total Liabilities | 1,893,680 | 2,018,071 |
Redeemable Noncontrolling Interest | 4,706 | 4,607 |
Preferred Stock | 0 | 0 |
Common Stockholders’ Equity | ||
Common stock | 20,000 | 20,000 |
Capital in excess of par value | 376,412 | 370,700 |
Retained earnings | 6,179,948 | 5,791,724 |
Accumulated other comprehensive income (loss), net of tax | ||
Cumulative foreign currency translation adjustment | (16,133) | 6,314 |
Unrealized gain on available-for-sale securities | 0 | 194,889 |
Unrealized gain on pensions and other postretirement plans | 328,885 | 334,536 |
Cash flow hedge | 303 | (184) |
Cost of Class B common stock held in treasury | (3,914,058) | (3,802,834) |
Total Equity | 2,975,357 | 2,915,145 |
Total Liabilities and Equity | $ 4,873,743 | $ 4,937,823 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash Flows from Operating Activities | ||
Net Income | $ 214,670 | $ 87,929 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation, amortization and goodwill and other long-lived asset impairment | 84,070 | 84,351 |
Net pension benefit | (55,458) | (44,281) |
Early retirement program expense | 0 | 932 |
Gain on marketable equity securities and cost method investments, net | (36,793) | 0 |
Stock-based compensation expense, net | 5,172 | 7,528 |
(Gain) loss on disposition of businesses, property, plant and equipment and investments, net | (13,379) | 504 |
Debt extinguishment costs | 10,563 | 0 |
Foreign exchange loss (gain) | 2,205 | (6,608) |
Write-down of cost method investments | 2,500 | |
Write-down of cost method investments | 200 | |
Equity in earnings of affiliates, net of distributions | (10,294) | (1,434) |
(Benefit) provision for deferred income taxes | (10,867) | 16,306 |
Change in operating assets and liabilities: | ||
Accounts receivable, net | 55,200 | 106,230 |
Accounts payable and accrued liabilities | (95,100) | (63,255) |
Deferred revenue | 38,148 | 27,254 |
Income taxes receivable | 23,073 | 14,477 |
Other assets and other liabilities, net | (23,757) | (9,795) |
Other | 1,905 | 519 |
Net Cash Provided by Operating Activities | 191,858 | 220,857 |
Cash Flows from Investing Activities | ||
Investments in certain businesses, net of cash acquired | (111,451) | (299,938) |
Proceeds from sales of marketable equity securities | 66,741 | 0 |
Purchases of property, plant and equipment | (58,850) | (43,863) |
Advance related to Kaplan University transaction and loan to affiliate | (28,061) | (6,771) |
Net (payments) proceeds from disposition of businesses, property, plant and equipment and investments | (13,483) | 2,672 |
Investments in equity affiliates, cost method and other investments | (10,679) | (66,097) |
Return of investment in equity affiliates | 4,521 | 3,527 |
Net Cash Used in Investing Activities | (151,262) | (410,470) |
Cash Flows from Financing Activities | ||
Repayments of borrowings and early redemption premium | (417,112) | (7,712) |
Issuance of borrowings | 400,000 | 0 |
Common shares repurchased | (110,848) | (35,394) |
Dividends paid | (21,564) | (21,304) |
Purchase of noncontrolling interest | (16,500) | 0 |
Payments of debt financing costs | (6,490) | 0 |
Deferred payments of acquisition and noncontrolling interest | 0 | (5,187) |
Other | 5,303 | (4,962) |
Net Cash Used in Financing Activities | (167,211) | (74,559) |
Effect Of Currency Exchange Rate Change | (4,216) | 9,768 |
Net Decrease in Cash and Cash Equivalents and Restricted Cash | (130,831) | (254,404) |
Beginning Cash and Cash Equivalents and Restricted Cash | 407,566 | 670,816 |
Ending Cash and Cash Equivalents and Restricted Cash | $ 276,735 | $ 416,412 |
Organization, Basis of Presenta
Organization, Basis of Presentation and Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2018 | |
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 seven television broadcasting stations, several websites and print publications, and a marketing solutions provider. The Company’s other business operations include manufacturing and home health and hospice services. On March 22, 2018, Kaplan completed the sale of the institutional assets and operations of Kaplan University (KU) to an Indiana non-profit, public-benefit corporation that is a subsidiary affiliated with Purdue University (Purdue) (see Note 2). The gain on the sale of the institutional assets of KU is included in other income, net, in the Condensed Consolidated Statement of Operations. As a result of the transaction, Kaplan reorganized its higher education operations into the following two operating segments for the purpose of making operating decisions and assessing performance: Higher Education and Professional (U.S.) (see Note 16). The higher education segment comprises the historical KU for-profit postsecondary education business and the current non-academic operations support services provided to the new university, Purdue University Global. The Professional (U.S.) segment comprises the KU School of Professional and Continuing Education, which provides professional training and exam preparation for professional certifications and licensures. 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, 2018 and 2017 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 Current Report on Form 8-K filed on May 21, 2018. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. 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. The standard permits two implementation approaches, full retrospective, requiring retrospective application of the new guidance with a restatement of prior years, or modified retrospective, requiring prospective application of the new guidance with disclosure of results under the old guidance in the first year of adoption. The Company adopted the new guidance on January 1, 2018 using the modified retrospective approach for contracts not completed as of the adoption date. Upon adoption of the new guidance, the Company recorded a net increase to the opening balance of retained earnings of $7.4 million . This adjustment was driven by changes in the timing of recognition of both revenues and expenses. A change in revenue recognition at a manufacturing business resulted in the acceleration of revenue and associated expenses as revenue is now recognized over time versus at a point in time. A change in the contract term at an education business resulted in a different revenue recognition pattern from previous recognition. Finally, the Company’s treatment of certain commissions paid to employees and agents at its education division changed. The Company previously expensed such commissions as incurred. Upon adoption of the new guidance, the Company capitalizes certain commission costs as an incremental cost of obtaining a contract and subsequently amortizes the cost as the tuition services are delivered to students. The cumulative effect of the changes to the Company’s Condensed Consolidated Balance Sheet as a result of adopting the new guidance was as follows: (in thousands) Balance as of December 31, 2017 Adjustments Balance as of January 1, 2018 Assets Accounts receivable, net $ 620,319 $ 2,142 $ 622,461 Inventories and contracts in progress 60,612 903 61,515 Other current assets 66,253 6,343 72,596 Liabilities Accounts payable and accrued liabilities $ 526,323 $ 88 $ 526,411 Deferred revenue 339,454 (346 ) 339,108 Deferred income taxes 362,701 2,197 364,898 Equity Retained earnings $ 5,791,724 $ 7,449 $ 5,799,173 Under the modified retrospective method of adoption, the Company is required to disclose the impact the adoption of the revenue guidance had on its Condensed Consolidated Statement of Operations. Under the previous guidance, KU’s fee revenue with Purdue University Global is not fixed and determinable until the end of Purdue University Global’s fiscal year (see Note 2). As a result, the Company would report $4.5 million less revenue and operating income. If the company continued to follow its accounting policies under the previous guidance for all other revenue streams, revenue would be $0.1 million higher and expenses would be $ 1.8 million lower for the quarter ended September 30, 2018 . For the nine months ended September 30, 2018 , revenue and expenses would be $1.2 million and $2.6 million lower, respectively. This is primarily due to the net impact of the change in the timing of the recognition of revenue and costs to obtain a contract. 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. The Company adopted this guidance in the first quarter of 2018 and recorded a cumulative adjustment of $194.9 million to retained earnings on its Condensed Consolidated Balance Sheet related to unrealized gains of available-for-sale securities, net of tax, previously classified within accumulated other comprehensive income. Results for reporting periods beginning after January 1, 2018 are presented under this new guidance, with any changes in fair value recognized in net income. In addition, the Company elected the measurement alternative to measure cost method investments that do not have a readily determinable fair value at cost less impairment, adjusted by observable price changes with any fair value changes recognized in net income. 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 provides two methods of adoption. Using a modified retrospective approach, lessees and lessors are required to recognize and measure leases at either the beginning of the earliest period presented or in the period of adoption. The Company will adopt the new guidance on January 1, 2019 and will recognize and measure leases at that date. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements; however, the recognition of right-of-use assets and lease liabilities is expected to have a material effect on its Condensed Consolidated Balance Sheet. In March 2017, the FASB issued new guidance that changes the presentation of net periodic pension cost and net periodic postretirement benefit cost for defined benefit plans. The guidance requires an issuer to disaggregate the service cost component of net periodic pension and postretirement benefit cost from other components. Under the new guidance, service cost will be included in the same line item(s) as other compensation costs arising from services rendered by employees during the period, while the other components will be recognized after income from operations. The guidance is effective for interim and fiscal years beginning after December 15, 2017. The guidance must be applied retrospectively; however, a practical expedient is available which permits an employer to use amounts previously disclosed in its pension and postretirement plans footnote for the prior comparative periods. The Company adopted the new standard in the first quarter of 2018. In combination with the presentation change to net periodic pension cost and net periodic postretirement benefit cost, the Company allocated its costs associated with fringe benefits between operating expenses and selling, general and administrative expenses. Previously, costs related to fringe benefits were generally classified as selling, general and administrative expenses. The amounts in the previously issued financial statements have been reclassified to conform to the reclassified presentation. The effect of these changes to the Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2017 is as follows: As Previously Reported Adjustment Upon Adoption (in thousands) Three Months Ended September 30, 2017 Operating expenses $ 352,635 $ 22,352 $ 374,987 Selling, general and administrative expenses 232,782 (4,731 ) 228,051 Income from Operations 44,571 (17,621 ) 26,950 Non-operating pension and postretirement benefit income, net — 17,621 17,621 Income Before Income Taxes 38,244 — 38,244 Nine Months Ended September 30, 2017 Operating expenses $ 1,011,553 $ 70,868 $ 1,082,421 Selling, general and administrative expenses 678,139 (15,826 ) 662,313 Income from Operations 141,986 (55,042 ) 86,944 Non-operating pension and postretirement benefit income, net — 55,042 55,042 Income Before Income Taxes 127,929 — 127,929 |
Acquisitions and Dispositions o
Acquisitions and Dispositions of Businesses | 9 Months Ended |
Sep. 30, 2018 | |
Acquisitions And Dispositions [Abstract] | |
Acquisitions and Dispositions of Businesses | ACQUISITIONS AND DISPOSITIONS OF BUSINESSES Acquisitions . In the first nine months of 2018 , the Company acquired eight businesses, five in its education division, one in its healthcare division, and two in other businesses for $120.9 million in cash and contingent consideration. In September 2018, Graham Healthcare Group (GHG) acquired the assets of a small business and Kaplan acquired the test preparation and study guide assets of Barron’s Educational Series, a New York-based education publishing company. The acquisitions are expected to complement the healthcare and test preparation services currently offered by GHG and Kaplan, respectively. GHG is included in the healthcare division. The Barron’s Educational Series acquisition is included in the test preparation division. In August 2018, SocialCode acquired 100% of the membership interests of Marketplace Strategy (MPS), a Cleveland-based digital marketing agency that provides strategy consulting, optimization services, advertising management and creative solutions on online marketplaces including Amazon. SocialCode’s primary reason for the acquisition is to expand its platform offerings. The acquisition is included in other businesses. On July 31, 2018, Dekko acquired 100% of the issued and outstanding shares of Furnlite, Inc., a Fallston, NC-based manufacturer of power and data solutions for the hospitality and residential furniture industry. Dekko’s primary reasons for the acquisition are to complement existing product offerings and to provide potential synergies across the businesses. The acquisition is included in other businesses. On July 12, 2018, Kaplan acquired 100% of the issued and outstanding shares of the College for Financial Planning (CFFP), a provider of financial education and training to individuals pursuing the Certified Financial Planner certification, a Master of Science in Personal Financial Planning, or a Master of Science in Finance. The acquisition is expected to expand Kaplan’s financial education product offerings and is included in the Professional (U.S.) division. In May 2018, Kaplan acquired a 100% interest in Professional Publications, Inc. (PPI), an independent publisher of professional licensing exam review materials and a leader in engineering, surveying, architecture, and interior design licensure exam review, by purchasing all of its issued and outstanding shares. This acquisition is expected to provide certain strategic benefits in the future. This acquisition is included in the Professional (U.S.) division. In January and February 2018, Kaplan acquired the assets of i-Human Patients, Inc., a leader in cloud-based, interactive patient encounter simulations for medical and nursing professionals and educators, and another small business in its test preparation and international divisions, respectively. These acquisitions are expected to provide strategic benefits in the future. During 2017 , the Company acquired six businesses, two in its education division, two in its television broadcasting division, one in its healthcare division and one in other businesses for $318.9 million in cash and contingent consideration, and the assumption of $59.1 million in certain pension and postretirement obligations. On January 17, 2017, the Company closed on its agreement with Nexstar Broadcasting Group, Inc. and Media General, Inc. to acquire the assets of WCWJ, a CW affiliate television station in Jacksonville, FL and WSLS, an NBC affiliate television station in Roanoke, VA, for cash and the assumption of certain pension obligations. The acquisition of WCWJ and WSLS will complement the other stations that GMG operates. Both of these acquisitions are included in television broadcasting. In February 2017, Kaplan acquired a 100% interest in Genesis Training Institute, a Dubai-based provider of professional development training in the United Arab Emirates, by purchasing all of its issued and outstanding shares. Additionally, Kaplan acquired a 100% interest in Red Marker Pty Ltd, an Australia-based regulatory technology company by purchasing all of its outstanding shares. These acquisitions are expected to provide certain strategic benefits in the future. Both of these acquisitions are included in Kaplan International. In April 2017, the Company acquired 97.72% of the issued and outstanding shares of Hoover Treated Wood Products, Inc., a Thomson, GA-based supplier of pressure impregnated kiln-dried lumber and plywood products for fire retardant and preservative applications for $206.8 million , net of cash acquired. The fair value of the redeemable noncontrolling interest in Hoover was $3.7 million at the acquisition date, determined using a market approach. The minority shareholders have an option to put some of their shares to the Company starting in 2019 and the remaining shares starting in 2021. The Company has an option to buy the shares of minority shareholders starting in 2027. This acquisition is consistent with the Company’s ongoing strategy of investing in companies with a history of profitability and strong management. Hoover is included in other businesses. At the end of June 2017, GHG acquired a 100% interest in Hometown Home Health and Hospice, a Lapeer, MI-based healthcare services provider by purchasing all of its issued and outstanding shares. This acquisition expands GHG’s service area in Michigan. GHG is included in healthcare. Acquisition-related costs for acquisitions that closed during 2018 were $1.2 million and were expensed as incurred. Acquisition-related costs for acquisitions that closed during the first nine months of 2017 were $4.1 million and were expensed as incurred. The aggregate purchase price of the 2018 and 2017 acquisitions was allocated as follows (2018 on a preliminary basis): Purchase Price Allocation Nine Months Ended Twelve Months Ended (in thousands) September 30, 2018 December 31, 2017 Accounts receivable $ 2,334 $ 12,502 Inventory 1,268 25,253 Property, plant and equipment 1,518 29,921 Goodwill 41,397 143,149 Indefinite-lived intangible assets 14,200 33,800 Amortized intangible assets 64,327 170,658 Other assets 4,912 1,880 Pension and other postretirement benefits liabilities — (59,116 ) Other liabilities (7,575 ) (12,177 ) Deferred income taxes (4,460 ) (37,289 ) Redeemable noncontrolling interest — (3,666 ) Aggregate purchase price, net of cash acquired $ 117,921 $ 304,915 The 2018 fair values recorded were based upon preliminary valuations and the estimates and assumptions used in such valuations are subject to change within the measurement period (up to one year from the acquisition date). The recording of deferred tax assets or liabilities, working capital and the final amount of residual goodwill and other intangibles are not yet finalized. Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the estimated future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. The goodwill recorded due to these acquisitions is attributable to the assembled workforces of the acquired companies and expected synergies. The Company expects to deduct $32.4 million of goodwill for income tax purposes for the acquisitions completed during the first nine months of 2018. The Company expects to deduct $11.0 million of goodwill for income tax purposes for the acquisitions completed in 2017 . 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 for the companies acquired in 2018 of $10.2 million for the third quarter of 2018 and had no impact on operating income. The Company’s Condensed Consolidated Statements of Operations include aggregate revenues and operating losses of $12.6 million and $0.8 million , respectively, for the first nine months of 2018 . The following unaudited pro forma financial information presents the Company’s results as if the 2018 acquisitions had occurred at the beginning of 2017 . The unaudited pro forma information also includes the 2017 acquisitions as if they occurred at the beginning of 2016 : Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Operating revenues $ 680,279 $ 674,991 $ 2,046,792 $ 2,033,078 Net income 126,104 25,896 219,092 98,564 These pro forma results were based on estimates and assumptions, which the Company believes are reasonable, and include the historical results of operations of the acquired companies and adjustments for depreciation and amortization of identified assets and the effect of pre-acquisition transaction related expenses incurred by the Company and the acquired entities. The pro forma information does not include efficiencies, cost reductions and synergies expected to result from the acquisitions. 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. Kaplan University Transaction. On April 27, 2017, certain subsidiaries of Kaplan entered into a Contribution and Transfer Agreement to contribute the institutional assets and operations of Kaplan University to an Indiana non-profit, public-benefit corporation that is a subsidiary affiliated with Purdue University. The closing of the transactions contemplated by the Transfer Agreement occurred on March 22, 2018. At the same time, the parties entered into a Transition and Operations Support Agreement (TOSA) pursuant to which Kaplan will provide key non-academic operations support to the new university. The new university will operate largely online as a new Indiana public university affiliated with Purdue under the name Purdue University Global. As part of the transfer to Purdue University Global, KU transferred students, academic personnel, faculty and operations, property leases for KU’s campuses and learning centers, Kaplan-owned academic curricula and content related to KU courses. The operations support activities that Kaplan will provide to Purdue University Global will include technology support, help-desk functions, human resources support for transferred faculty and employees, admissions support, financial aid administration, marketing and advertising, back-office business functions, certain test preparation and domestic and international student recruiting services. The transfer of KU does not include any of the assets of the KU School of Professional and Continuing Education, which provides professional training and exam preparation for professional certifications and licensures, nor does it include the transfer of other Kaplan businesses such as Kaplan Test Preparation and Kaplan International. Those entities, programs and business lines will remain part of Kaplan. Kaplan received nominal cash consideration upon transfer of the institutional assets. Pursuant to the TOSA, Kaplan is not entitled to receive any reimbursement of costs incurred in providing support functions, or any fee, unless and until Purdue University Global has first covered all of its operating costs (subject to a cap). If Purdue University Global achieves cost efficiencies in its operations, then Purdue University Global may be entitled to an additional payment equal to 20 percent of such cost efficiencies (Purdue Efficiency Payment). In addition, during each of Purdue University Global’s first five years, prior to any payment to Kaplan, Purdue University Global is entitled to a priority payment of $10 million per year beyond costs. To the extent Purdue University Global’s revenue is insufficient to pay the $10 million per year priority payment, Kaplan is required to advance an amount to Purdue University Global to cover such insufficiency. At closing, Kaplan paid to Purdue University Global an advance in the amount of $20 million, representing, and in lieu of, priority payments for Purdue University Global’s fiscal years ending June 30, 2019 and June 30, 2020. To the extent that there are sufficient revenues to pay the Purdue Efficiency Payment, Purdue University Global is reimbursed for its operating costs (subject to a cap) and the priority payment to Purdue University Global is paid. To the extent there is remaining revenue, Kaplan will then receive reimbursement for its operating costs (subject to a cap) of providing the support activities. If Kaplan achieves cost efficiencies in its operations, then Kaplan may be entitled to an additional payment equal to 20 percent of such cost efficiencies (Kaplan Efficiency Payment). If there are sufficient revenues, Kaplan may also receive a fee equal to 12.5 percent of Purdue University Global’s revenue. The fee will increase to 13 percent beginning with Purdue University Global’s fiscal year ending June 30, 2023 and continuing through Purdue University Global’s fiscal year ending June 30, 2027, and then the fee will return to 12.5 percent thereafter. Subject to certain limitations, a portion of the fee that is earned by Kaplan in one year may be carried over and instead paid to Kaplan in subsequent years. After the first five years of the TOSA, Kaplan and Purdue University Global will be entitled to payments in a manner consistent with the structure described above, except that (i) Purdue University Global will no longer be entitled to a priority payment and (ii) to the extent that there are sufficient revenues after payment of the Kaplan Efficiency Payment (if any), Purdue University Global will be entitled to an annual payment equal to 10 percent of the remaining revenue after the Kaplan Efficiency Payment (if any) is paid and subject to certain other adjustments. The TOSA has a 30-year initial term, which will automatically renew for five-year periods unless terminated. After the sixth year, Purdue University Global has the right to terminate the agreement upon payment of a termination fee equal to 1.25 times Purdue University Global’s revenue for the preceding 12-month period, which payment would be made pursuant to a 10-year note, and at the election of Purdue University Global, it may receive for no additional consideration certain assets used by Kaplan to provide the support activities pursuant to the TOSA. At the end of the 30-year term, if Purdue University Global does not renew the TOSA, Purdue University Global will be obligated to make a final payment of 75% of its total revenue earned during the preceding 12-month period, which payment will be made pursuant to a 10-year note, and at the election of Purdue University Global, it may receive for no additional consideration certain assets used by Kaplan to provide the support activities pursuant to the TOSA. Either party may terminate the TOSA at any time if Purdue University Global generates (i) $25 million in cash operating losses for three consecutive years or (ii) aggregate cash operating losses greater than $75 million at any point during the initial term. Operating loss is defined as the amount of revenue Purdue University Global generates minus the sum of (1) Purdue University Global’s and Kaplan’s respective costs in performing academic and support functions and (2) the $10 million priority payment to Purdue University Global in each of the first five years. Upon termination for any reason, Purdue University Global will retain the assets that Kaplan contributed pursuant to the Transfer Agreement. Each party also has certain termination rights in connection with a material default or material breach of the TOSA by the other party. Pursuant to the U.S. Department of Education (ED) requirements, Purdue assumes responsibility for any liability arising from the operation of the institution. This assumption will not limit Kaplan’s obligation to indemnify Purdue for pre-closing liabilities under the Transfer Agreement. As a result of the transfer of KU, Kaplan will no longer own or operate KU or any other institution participating in student financial aid programs that have been created under Title IV of the U.S. Federal Higher Education Act of 1965, as amended. Consequently, Kaplan is no longer responsible for operating KU. However, pursuant to the TOSA, Kaplan will be performing functions that fall within the ED's definition of a third-party servicer and will, therefore, assume certain regulatory responsibilities that require approval by the ED. The third-party servicer arrangement between Kaplan and Purdue University Global is also subject to information security requirements established by the Federal Trade Commission as well as all aspects of the Family Educational Rights and Privacy Act. As a third-party servicer, Kaplan may be required to undergo an annual compliance audit of its administration of the Title IV functions or services that it performs. As a result of the KU Transaction, the Company recorded a pre-tax gain of $4.3 million in the first quarter of 2018. For financial reporting purposes, Kaplan may receive payment of additional consideration for the sale of the institutional assets as part of the fee to the extent there are sufficient revenues available after paying all amounts required by the TOSA. The Company recorded a $0.5 million and $1.9 million contingent consideration gain related to the disposition in the three and nine months ended September 30, 2018, respectively. The revenue and operating income related to the KU business disposed of are as follows: Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Revenue $ — $ 105,036 $ 91,526 $ 327,529 Operating income — 1,785 213 18,582 Sale of Businesses. In September 2018, Kaplan Australia completed the sale of a small business which was included in Kaplan International. In February 2018, Kaplan completed the sale of a small business which was included in Test Preparation. In February 2017, GHG completed the sale of Celtic Healthcare of Maryland. In the fourth quarter of 2017, Kaplan Australia completed the sale of a small business, which was included in Kaplan International. As a result of these sales, the Company reported gains (losses) in other non-operating income (see Note 13) . Other Transactions. In June 2018, the Company incurred $6.2 million of interest expense related to the mandatorily redeemable noncontrolling interest redemption settlement at GHG. The mandatorily redeemable noncontrolling interest was redeemed and paid in July 2018. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2018 | |
Investments [Abstract] | |
Investments | INVESTMENTS As of September 30, 2018 and December 31, 2017 , the Company had money market investments of $86.0 million and $217.6 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 $ 239,904 $ 269,343 Gross unrealized gains 257,975 266,972 Total Fair Value $ 497,879 $ 536,315 There were no purchases of marketable equity securities during the first nine months of 2018 and 2017 . During the first nine months of 2018 , the gross cumulative realized gains from the sales of marketable equity securities were $37.3 million . The total proceeds from such sales were $66.7 million . There were no sales of marketable equity securities for the first nine months of 2017 . The gain on marketable equity securities comprised the following: Three Months Ended Nine Months Ended (in thousands) September 30, 2018 September 30, 2018 Gain on marketable equity securities, net $ 44,962 $ 28,306 Plus: Net losses in earnings from marketable equity securities sold — 4,271 Net unrealized gains in earnings from marketable equity securities still held at the end of the period $ 44,962 $ 32,577 As of September 30, 2018 , the Company held an approximate 11% interest in Intersection Holdings, LLC, and in several other affiliates; GHG held a 40% interest in Residential Home Health Illinois, a 42.5% interest in Residential Hospice Illinois, a 40% interest in the joint venture formed between GHG and a Michigan hospital, and a 40% interest in the joint venture formed between GHG and Allegheny Health Network (AHN). For the three and nine months ended September 30, 2018 , the Company recorded $2.5 million and $9.5 million , respectively, in revenue for services provided to the affiliates of GHG. For the three and nine months ended September 30, 2017 , the Company recorded $4.5 million and $14.1 million , respectively, in revenue for services provided to the affiliates of GHG. In the third quarter of 2018, the Company recorded $7.9 million in gains in equity in earnings of affiliates related to two of its investments. Additionally, Kaplan International Holdings Limited (KIHL) held a 45% interest in a joint venture formed with York University. KIHL agreed to loan the joint venture £25 million , of which £16 million was advanced as of December 31, 2017 . In the second quarter of 2018, KIHL advanced a final amount of £6 million in additional funding to the joint venture under this agreement, bringing the total amount advanced to £22 million . The loan will be repayable over 25 years at an interest rate of 7% and the loan is guaranteed by the University of York. The Company held investments without readily determinable fair values in a number of equity securities that are accounted for as cost method investments, which are recorded at cost, less impairment, and adjusted for observable price changes for identical or similar investments of the same issuer. The carrying value of these investments was $27.4 million and $19.9 million as of September 30, 2018 and December 31, 2017 , respectively. During the three and nine months ended September 30, 2018 , the Company recorded gains of $8.5 million to those equity securities based on observable transactions and an impairment loss of $2.5 million . |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Sep. 30, 2018 | |
Accounts and Notes Receivable, Net [Abstract] | |
Accounts Receivable | ACCOUNTS RECEIVABLE Accounts receivable consist of the following: As of September 30, December 31, (in thousands) Receivables from contracts with customers, less doubtful accounts of $14,453 and $22,975 $ 544,487 $ 600,215 Other receivables 45,158 20,104 $ 589,645 $ 620,319 Bad debt expense was $1.8 million and $6.5 million for the three months ended September 30, 2018 and 2017 , respectively; and $7.9 million and $18.7 million for the nine months ended September 30, 2018 and 2017 , respectively. |
Inventories and Contracts in Pr
Inventories and Contracts in Progress | 9 Months Ended |
Sep. 30, 2018 | |
Inventory, Net of Allowances, Customer Advances and Progress Billings [Abstract] | |
Inventories and Contracts in Progress | INVENTORIES AND CONTRACTS IN PROGRESS Inventories and contracts in progress consist of the following: As of September 30, December 31, (in thousands) Raw materials $ 37,300 $ 30,429 Work-in-process 10,926 10,258 Finished goods 18,506 18,851 Contracts in progress 6,964 1,074 $ 73,696 $ 60,612 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS The Company reorganized its operations in the first quarter of 2018 into the following six operating segments for the purpose of making operating decisions and assessing performance: Kaplan International, Higher Education, Test Preparation, Professional (U.S.), Television Broadcasting and Healthcare (see Note 16). The reorganization changed the composition of the reporting units within the education division, and resulted in the reassignment of the assets and liabilities to the reporting units affected. The goodwill was allocated to the affected reporting units using the relative fair value approach. As a result of the reassignment and allocation, the Company performed an interim review of the carrying value of goodwill at the education division for possible impairment on both a pre and post-reorganization basis. No impairment of goodwill was indicated at the pre- and post-reorganization reporting units. In the third quarter of 2018, the Healthcare business recorded an intangible asset impairment charge of $7.9 million following the decision to discontinue the use of the Celtic tradename. The fair value of the intangible asset was estimated using an income approach. In the second quarter of 2017, as a result of a challenging operating environment, the Forney reporting unit recorded a goodwill and other long-lived asset impairment charge of $9.2 million . The Company performed an interim review of the goodwill and other long-lived assets of the reporting unit by utilizing a discounted cash flow model to estimate the fair value. The carrying value of the reporting unit exceeded the estimated fair value, resulting in a goodwill impairment charge for the amount by which the carrying value exceeded the reporting unit’s estimated fair value. Forney is included in other businesses. Amortization of intangible assets for the three months ended September 30, 2018 and 2017 was $12.3 million and $10.9 million , respectively. Amortization of intangible assets for the nine months ended September 30, 2018 and 2017 was $34.1 million and $28.3 million , respectively. Amortization of intangible assets is estimated to be approximately $12 million for the remainder of 2018 , $48 million in 2019 , $45 million in 2020 , $39 million in 2021 , $33 million in 2022 and $83 million thereafter. The changes in the carrying amount of goodwill, by segment, were as follows: (in thousands) Education Television Broadcasting Healthcare Other Businesses Total Balance as of December 31, 2017 Goodwill $ 1,171,812 $ 190,815 $ 69,409 $ 233,825 $ 1,665,861 Accumulated impairment losses (350,850 ) — — (15,301 ) (366,151 ) 820,962 190,815 69,409 218,524 1,299,710 Acquisitions 19,981 — 217 21,199 41,397 Dispositions (11,191 ) — — — (11,191 ) Foreign currency exchange rate changes (19,841 ) — — — (19,841 ) Balance as of September 30, 2018 Goodwill 1,141,062 190,815 69,626 255,024 1,656,527 Accumulated impairment losses (331,151 ) — — (15,301 ) (346,452 ) $ 809,911 $ 190,815 $ 69,626 $ 239,723 $ 1,310,075 The changes in carrying amount of goodwill at the Company’s education division were as follows: (in thousands) Kaplan International Higher Education Test Preparation Professional (U.S.) Total Balance as of December 31, 2017 Goodwill $ 615,861 $ 205,494 $ 166,098 $ 184,359 $ 1,171,812 Accumulated impairment losses — (131,023 ) (102,259 ) (117,568 ) (350,850 ) 615,861 74,471 63,839 66,791 820,962 Acquisitions 26 — 626 19,329 19,981 Dispositions — (11,191 ) — — (11,191 ) Foreign currency exchange rate changes (19,775 ) (40 ) — (26 ) (19,841 ) Balance as of September 30, 2018 Goodwill 596,112 174,564 166,724 203,662 1,141,062 Accumulated impairment losses — (111,324 ) (102,259 ) (117,568 ) (331,151 ) $ 596,112 $ 63,240 $ 64,465 $ 86,094 $ 809,911 Other intangible assets consist of the following: As of September 30, 2018 As of December 31, 2017 (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 (1) $ 281,639 $ 106,235 $ 175,404 $ 260,464 $ 83,690 $ 176,774 Trade names and trademarks 2–10 years 71,870 37,858 34,012 50,286 25,596 24,690 Network affiliation agreements 10 years 17,400 2,972 14,428 17,400 1,668 15,732 Databases and technology 3–6 years 28,788 8,537 20,251 19,563 5,008 14,555 Noncompete agreements 2–5 years 1,093 778 315 930 467 463 Other 1–8 years 24,530 8,885 15,645 13,430 7,668 5,762 $ 425,320 $ 165,265 $ 260,055 $ 362,073 $ 124,097 $ 237,976 Indefinite-Lived Intangible Assets Trade names and trademarks $ 95,802 $ 82,745 FCC licenses 18,800 18,800 Licensure and accreditation 150 650 $ 114,752 $ 102,195 ____________ (1) As of December 31, 2017, the student and customer relationships’ minimum useful life was 1 year. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | DEBT The Company’s borrowings consist of the following: As of September 30, December 31, (in thousands) 5.75% unsecured notes due June 1, 2026 (1) $ 394,504 $ — 7.25% unsecured notes due February 1, 2019 — 399,507 UK Credit facility (2) 85,024 93,671 Other indebtedness 100 109 Total Debt $ 479,628 $ 493,287 Less: current portion (6,568 ) (6,726 ) Total Long-Term Debt $ 473,060 $ 486,561 ___________ _ (1) The carrying value is net of $5.5 million of unamortized debt issuance costs as of September 30, 2018 . (2) The carrying value is net of $0.3 million and $0.4 million of unamortized debt issuance costs as of September 30, 2018 and December 31, 2017 , respectively. The Company’s other indebtedness at September 30, 2018 and December 31, 2017 is at an interest rate of 2% and matures in 2026 . On May 30, 2018, the Company issued $400 million senior unsecured fixed-rate notes due June 1, 2026 (the Notes). The Notes are guaranteed, jointly and severally, on a senior unsecured basis, by certain of the Company’s existing and future domestic subsidiaries, as described in the terms of the indenture, dated as of May 30, 2018 (the Indenture). The Notes have a coupon rate of 5.75% per annum, payable semi-annually on June 1 and December 1, beginning on December 1, 2018. The Company may redeem the Notes in whole or in part at any time at the respective redemption prices described in the Indenture. On June 29, 2018, the Company used the net proceeds from the sale of the Notes, together with cash on hand, to redeem the $400 million of 7.25% notes due February 1, 2019. The Company incurred $11.4 million in debt extinguishment costs in relation to the early termination of the 7.25% notes. In combination with the issuance of the Notes, the Company and certain of the Company’s domestic subsidiaries named therein as guarantors entered into an amended and restated credit agreement providing for a U.S. $300 million five -year revolving credit facility (the Revolving Credit Facility) with each of the lenders party thereto, certain of the Company’s foreign subsidiaries from time to time party thereto as foreign borrowers, Wells Fargo Bank, N.A., as Administrative Agent (Wells Fargo), JPMorgan Chase Bank, N.A., as Syndication Agent, and HSBC Bank USA, N.A. and Bank of America, N.A. as Documentation Agents (the Amended and Restated Credit Agreement), which amends and restates the Company’s existing Five Year Credit Agreement, dated as of June 29, 2015, among the Company, certain of its domestic subsidiaries as guarantors, the several lenders from time to time party thereto, Wells Fargo Bank, N.A., as Administrative Agent and JPMorgan Chase Bank, N.A., as Syndication Agent (the Existing Credit Agreement). The Amended and Restated Credit Agreement amends the Existing Credit Agreement to (i) extend the maturity of the Revolving Credit Facility to May 30, 2023, unless the Company and the lenders agree to further extend the term, (ii) increase the aggregate principal amount of the Revolving Credit Facility to U.S. $300 million , consisting of a U.S. Dollar tranche of U.S. $200 million for borrowings in U.S. Dollars and a multicurrency tranche equivalent to U.S. $100 million for borrowings in U.S. Dollars and certain foreign currencies, (iii) provide for borrowings under the Revolving Credit Facility in U.S. Dollars and certain other foreign currencies specified in the Amended and Restated Credit Agreement, (iv) permit certain foreign subsidiaries of the Company to be added to the Amended and Restated Credit Agreement as foreign borrowers thereunder and (v) effect certain other modifications to the Existing Credit Agreement. Under the Amended and Restated Credit Agreement, the Company is required to pay a commitment fee on a quarterly basis, based on the Company’s leverage ratio, of between 0.15% and 0.25% of the amount of the average daily unused portion of the Revolving Credit Facility. Any borrowings under the Amended and Restated Credit Agreement are made on an unsecured basis and bear interest at the Company’s option, either at (a) a fluctuating interest rate equal to the highest of Wells Fargo’s prime rate, 0.5 percent above the Federal funds rate or the one-month Eurodollar rate plus 1% , or (b) the Eurodollar rate for the applicable currency and interest period as defined in the Amended and Restated Credit Agreement, which is generally a periodic rate equal to LIBOR, CDOR, BBSY or SOR, as applicable, in the case of each of clauses (a) and (b) plus an applicable margin that depends on the Company’s consolidated debt to consolidated adjusted EBITDA (as determined pursuant to the Amended and Restated Credit Agreement, Total Net Leverage Ratio). The Company and its foreign subsidiaries may draw on the Revolving Credit Facility for general corporate purposes. Any outstanding borrowings must be repaid on or prior to the final termination date. The Amended and Restated Credit Agreement contains terms and conditions, including remedies in the event of a default by the Company, typical of facilities of this type and requires the Company to maintain a Total Net Leverage Ratio of not greater than 3.5 to 1.0 and a consolidated interest coverage ratio of at least 3.5 to 1.0 based upon the ratio of consolidated adjusted EBITDA to consolidated interest expense as determined pursuant to the Amended and Restated Credit Agreement. The Company is in compliance with all financial covenants as of September 30, 2018 . During the three months ended September 30, 2018 and 2017 , the Company had average borrowings outstanding of approximately $480.6 million and $492.4 million , respectively, at average annual interest rates of approximately 5.1% and 6.3% , respectively. During the three months ended September 30, 2018 and 2017 , the Company incurred net interest expense of $5.5 million and $7.8 million , respectively. During the nine months ended September 30, 2018 and 2017 , the Company had average borrowings outstanding of approximately $529.2 million and $493.5 million , respectively, at average annual interest rates of approximately 5.7% and 6.3% , respectively. During the nine months ended September 30, 2018 and 2017 , the Company incurred net interest expense of $27.5 million and $22.4 million , respectively. In June 2018, the Company incurred $6.2 million of interest expense related to the mandatorily redeemable noncontrolling interest redemption settlement at GHG (see Note 2). The fair value of the mandatorily redeemable noncontrolling interest is based on the redemption value resulting from a negotiated settlement. At September 30, 2018 , the fair value of the Company’s 5.75% unsecured notes, based on quoted market prices (Level 2 fair value assessment), totaled $409.4 million , compared with the carrying amount of $394.5 million . At December 31, 2017 , the fair value of the Company’s 7.25% unsecured notes, based on quoted market prices (Level 2 fair value assessment), totaled $414.7 million , compared with the carrying amount of $399.5 million . The carrying value of the Company’s other unsecured debt at September 30, 2018 and December 31, 2017 approximates fair value. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
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, 2018 (in thousands) Level 1 Level 2 Total Assets Money market investments (1) $ — $ 85,999 $ 85,999 Marketable equity securities (2) 497,879 — 497,879 Other current investments (3) 13,069 6,979 20,048 Interest rate swap (4) — 418 418 Total Financial Assets $ 510,948 $ 93,396 $ 604,344 Liabilities Deferred compensation plan liabilities (5) $ — $ 38,154 $ 38,154 As of December 31, 2017 (in thousands) Level 1 Level 2 Level 3 Total Assets Money market investments (1) $ — $ 217,628 $ — $ 217,628 Marketable equity securities (2) 536,315 — — 536,315 Other current investments (3) 9,831 11,007 — 20,838 Total Financial Assets $ 546,146 $ 228,635 $ — $ 774,781 Liabilities Deferred compensation plan liabilities (5) $ — $ 43,414 $ — $ 43,414 Interest rate swap (6) — 244 — 244 Mandatorily redeemable noncontrolling interest (7) — — 10,331 10,331 Total Financial Liabilities $ — $ 43,658 $ 10,331 $ 53,989 ____________ (1) The Company’s money market investments are included in Cash and Cash Equivalents and Restricted Cash and the value considers the liquidity of the counterparty. (2) The Company’s investments in marketable equity securities are held in common shares of U.S. corporations that are actively traded on U.S. stock exchanges. Price quotes for these shares are readily available. Investments in marketable securities were classified as available-for-sale in 2017 prior to the adoption of the new accounting guidance (see Note 1). (3) 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 fair value hierarchy. (4) Included in Deferred Charges and Other Assets. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. (5) 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. (6) Included in Other Liabilities. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. (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. During the three and nine months ended September 30, 2018 , the Company recorded gains of $8.5 million to equity securities that are accounted for as cost method investments based on observable transactions. In the third quarter of 2018, the Company recorded long-lived asset impairment charges of $8.1 million . In the second quarter of 2017, the Company recorded a goodwill and other long-lived asset impairment charge of $9.2 million . The remeasurement of the goodwill and other long-lived assets 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 reporting unit and other long-lived assets, and made estimates and assumptions regarding future cash flows, discount rates and long-term growth rates. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The Tax Cuts and Jobs Act (the Tax Act) was enacted in December 2017, making significant changes to the Internal Revenue Code. The SEC staff issued Staff Accounting Bulletin No. 118 (SAB 118) to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act. SAB 118 allows the registrant to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. The ultimate impact may materially differ from these provisional amounts due to, among other things, additional analysis, changes in interpretations and assumptions the Company made, additional regulatory guidance that may be issued, and actions the Company may take as a result of the Tax Act. In accordance with SAB 118, the Company has calculated a reasonable estimate of the impact of the Tax Act and recorded a provisional amount in its financial statements based on its understanding of the Tax Act and guidance available as of the date of this filing. The Company expects to complete its analysis within the measurement period in accordance with SAB 118. Changes as a result of the Tax Act include, but are not limited to, a reduction in the federal corporate income tax rate from 35% to 21% effective January 1, 2018 and the imposition of new U.S. taxes on certain non-U.S. earnings. The Company estimates that unremitted non-U.S. subsidiary earnings, when distributed, will not be subject to tax except to the extent non-U.S. withholding taxes are imposed. Further, the Tax Act provides a 100% dividends received deduction for distributions from non-U.S. subsidiaries after December 31, 2017, subject to certain holding period requirements. The Tax Act establishes a new regime, the Global Intangible Low Taxed Income (GILTI) tax, that may currently subject to U.S. tax the operations of non-U.S. subsidiaries. The GILTI tax is imposed annually based on all current year non-U.S. operations starting January 1, 2018. The Company has elected to record the GILTI tax regime as a periodic tax expense. The Company estimated the 2018 annual GILTI tax expense and considered this when estimating the annual effective tax rate. In the third quarter of 2018, the Company’s education division released valuation allowances recorded against state deferred tax assets, net of U.S. Federal tax, of approximately $17.8 million because the education division recently generated positive operating results that support the realization of these deferred tax assets. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer | REVENUE FROM CONTRACTS WITH CUSTOMERS Revenue Recognition. The following table presents the Company’s revenue disaggregated by revenue source for the three and nine months ended September 30, 2018 and September 30, 2017 : Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Education Revenue Kaplan international $ 167,668 $ 171,259 $ 535,553 $ 507,568 Higher education 89,269 105,210 275,080 328,161 Test preparation 67,749 72,680 195,504 212,978 Professional (U.S.) 34,302 28,249 98,715 88,812 Kaplan corporate and other 143 49 870 120 Intersegment elimination (530 ) (642 ) (1,617 ) (1,438 ) 358,601 376,805 1,104,105 1,136,201 Television broadcasting 130,014 101,295 352,902 298,893 Manufacturing 126,028 115,594 369,896 298,164 Healthcare 35,486 40,473 111,315 115,592 SocialCode 13,781 14,497 41,850 41,926 Other 10,856 8,561 26,856 25,253 Intersegment elimination — — (45 ) — Total Revenue $ 674,766 $ 657,225 $ 2,006,879 $ 1,916,029 The Company generated 78% and 76% of its revenue from U.S. domestic sales for the three and nine months ended September 30, 2018 , respectively. The remaining 22% and 24% of revenue for the three and nine months ended September 30, 2018 , respectively, was from non-U.S. sales. In the three and nine months ended September 30, 2018 , the Company recognized 80% of its revenue over time as control of the services and goods transferred to the customer. The remaining 20% of revenues were recognized at a point in time, when the customer obtained control of the promised goods. The determination of the method by which the Company measures its progress towards the satisfaction of its performance obligations requires judgment and is described below for each revenue stream. The Company identifies a contract for revenue recognition when there is approval and commitment from both parties, the rights of the parties and payment terms are identified, the contract has commercial substance and the collectability of consideration is probable. The Company evaluates each contract to determine the number of distinct performance obligations in the contract, which requires the use of judgment. Education Revenue. Education revenue is primarily derived from postsecondary education services, professional education and test preparation services provided both domestically and abroad. Generally tuition and other fees are paid upfront and recorded in deferred revenue in advance of the date when education services are provided to the student. In some instances, installment billing is available to students which reduces the amount of cash consideration received in advance of performing the service. The contractual terms and conditions associated with installment billing indicate that the student is liable for the total contract price, therefore mitigating the Company’s exposure to losses associated with nonpayment. The Company determined the installment billing does not represent a significant financing component. Kaplan International (KI) . KI provides higher education, professional education, and test preparation services and materials to students primarily in the United Kingdom, Singapore, and Australia. Some KI contracts consist of one performance obligation that is a combination of indistinct promises to the student, while other KI contracts include multiple performance obligations as the promises in the contract are both capable of being distinct and distinct within the context of the contract. One KI business offers an option whereby students receive future services at a discount that is accounted for as a material right. The transaction price is stated in the contract and known at the time of contract inception, therefore no variable consideration exists. Revenue is allocated to each performance obligation based on its standalone selling price. Any discounts within the contract are allocated across all performance obligations unless observable evidence exists that the discount relates to a specific performance obligation or obligations in the contract. KI generally determines standalone selling prices based on prices charged to students. Revenue is recognized ratably over the instruction period or access period for higher education, professional education and test preparation services. KI generally uses the time elapsed method, an input measure, as it best depicts the simultaneous consumption and delivery of these services. Course materials determined to be a separate performance obligation are recognized at the point in time when control transfers to the student, generally when the products are delivered to the student. Higher Education (KHE) . In the first quarter of 2018, KHE provided postsecondary education services to students through KU’s online programs and fixed-facility colleges. These contracts consisted either of one performance obligation that is a combination of distinct promises to a student, or two performance obligations if the student also enrolled in the Kaplan Tuition Cap, which established a maximum amount of tuition that KHE may charge students for higher education services. The Kaplan Tuition Cap was accounted for as a material right. The transaction price of a higher education contract was stated in the contract and known at the time of contract inception, therefore no variable consideration existed. A portion of the transaction price was allocated to the material right, if applicable, based on the expected value method. Higher education services revenue was recognized ratably over the instruction period. The Company used the time elapsed method, an input measure, as it best depicts the simultaneous consumption and delivery of higher education services. On March 22, 2018, Kaplan contributed the institutional assets and operations of KU to Purdue University Global (see Note 2). Subsequent to the transaction, KHE provides non-academic operations support services to Purdue University Global pursuant to the TOSA. This contract has a thirty year term and consists of one performance obligation, which represents a series of daily promises to provide support services to Purdue University Global. The transaction price is entirely made up of variable consideration related to the reimbursement of KU support costs and the KU fee. The TOSA outlines a payment structure, which dictates how cash will be distributed at the end of Purdue University Global’s fiscal year, which is the 30th of June. The collectability of the KU support costs and KU fee is entirely dependent on the availability of cash at the end of the fiscal year. This variable consideration is constrained based on fiscal year forecasts prepared for Purdue University Global. The forecasts are updated throughout the fiscal year until the uncertainty is ultimately resolved, which is at the end of each fiscal year for Purdue University Global. As KHE’s performance obligation is made up of a series, the variable consideration is allocated to the distinct service period to which it relates, which is the Purdue University Global fiscal year. Support services revenue is recognized over time based on the expenses incurred to date and the percentage of expected reimbursement. KU fee revenue is also recognized over time based on the amount of Purdue University Global revenue recognized to date and the percentage of fee expected to be collected for the fiscal year. The Company used these input measures as Purdue Global University simultaneously receives and consumes the benefits of the services provided by KHE. Kaplan Test Preparation (KTP) . KTP offers test preparation services and materials to students related to pre-college, graduate, health and bar review products. Generally KTP contracts include promises for test preparation services and course materials. As each promise is both capable of being distinct and distinct in the context of the contract, each promise is accounted for as a separate performance obligation. As the transaction price is stated in the contract and known at the time of contract inception, no variable consideration exists. Revenue is allocated to each performance obligation based on its standalone selling price. KTP generally determines standalone selling prices based on prices charged to students. Any discounts within the contract are allocated across all performance obligations unless observable evidence exists that the discount relates to a specific performance obligation or obligations in the contract. Test preparation services revenue is recognized ratably over the period of access. At KTP, an estimate of average access period is developed for each course, and this estimate is evaluated on an ongoing basis and adjusted as necessary. KTP generally uses the time elapsed method, an input measure, as it best depicts the simultaneous consumption and availability of access to test preparation services. Revenue associated with distinct course materials is recognized at the point in time when control transfers to the student, generally when the products are delivered to the student. KTP offers a guarantee on certain courses that gives students the ability to repeat a course if they are not satisfied with their exam score. The Company accounts for this guarantee as a separate performance obligation. Revenue allocated to remaining performance obligations represents deferred revenue amounts that will be recognized as revenue in future periods. As of September 30, 2018 , KTP’s deferred revenue balance related to certain medical and nursing qualifications with an original contract length greater than twelve months was $6.2 million . KTP expects to recognize 82% of this revenue over the next twelve months and the remainder thereafter. Kaplan Professional (U.S.) (KP): KP provides professional training and exam preparation for professional certifications and licensures to students. KP contracts include promises for professional education services and course materials. Generally KP revenue contracts consist of multiple performance obligations as each distinct promise is both capable of being distinct and distinct in the context of the contract. The transaction price is stated in the contract and known at the time of contract inception, therefore no variable consideration exists. Revenue is allocated to each performance obligation based on its standalone selling price. KP generally determines standalone selling prices based on the prices charged to students. Any discounts within the contract are allocated across all performance obligations unless observable evidence exists that the discount relates to a specific performance obligation or obligations in the contract. Professional education services revenue is recognized ratably over the period of access. KP generally uses the time elapsed method, an input measure, as it best depicts the simultaneous consumption and availability of access to professional education services. Revenue associated with distinct course materials is recognized at the point in time when control transfers to the student, generally when the products are delivered to the student. Television Broadcasting Revenue. Television broadcasting revenue at Graham Media Group (GMG) is primarily comprised of television and internet advertising revenue, and retransmission revenue. Television Advertising Revenue . GMG accounts for the series of advertisements included in television advertising contracts as one performance obligation and recognizes advertising revenue over time. The Company elected the right to invoice practical expedient, an output method, as GMG has the right to consideration that equals the value provided to the customer for advertisements delivered to date. As a result of the election to use the right to invoice practical expedient, GMG does not determine the transaction price or allocate any variable consideration at contract inception. Rather, GMG recognizes revenue commensurate with the amount to which GMG has the right to invoice the customer. Payment is typically received in arrears within sixty days of revenue recognition. Retransmission Revenue . Retransmission revenue represents compensation paid by cable, satellite and other multichannel video programming distributors (MVPDs) to retransmit GMG’s stations’ broadcasts in its designated market area. The retransmission rights granted to MVPDs are accounted for as a license of functional intellectual property as the retransmitted broadcast provides significant standalone functionality. As such, each retransmission contract with an MVPD includes one performance obligation for each station’s retransmission license. GMG recognizes revenue using the usage-based royalty method in which revenue is recognized in the month the broadcast is retransmitted based on the number of MVPD subscribers and the applicable per user rate identified in the retransmission contract. Payment is typically received in arrears within sixty days of revenue recognition. Manufacturing Revenue. Manufacturing revenue consists primarily of product sales generated by four businesses: Hoover, Dekko, Joyce and Forney. The Company has determined that each item ordered by the customer is a distinct performance obligation as it has standalone value and is distinct within the context of the contract. For arrangements with multiple performance obligations, the Company initially allocates the transaction price to each obligation based on its standalone selling price, which is the retail price charged to customers. Any discounts within the contract are allocated across all performance obligations unless observable evidence exists that the discount relates to a specific performance obligation or obligations in the contract. The Company sells some products and services with a right of return. This right of return constitutes variable consideration and is constrained from revenue recognition on a portfolio basis, using the expected value method until the refund period expires. The Company recognizes revenue when or as control transfers to the customer. Some manufacturing revenue is recognized ratably over the manufacturing period, if the product created for the customer does not have an alternative use to the Company and the Company has an enforceable right to payment for performance completed to date. The determination of the method by which the Company measures its progress towards the satisfaction of its performance obligations requires judgment. The Company measures its progress for these products using the units delivered method, an output measure. These arrangements represented 25% and 27% of the manufacturing revenue recognized in the three and nine months ended September 30, 2018 , respectively. Other manufacturing revenue is recognized at the point in time when control transfers to the customer, generally when the products are shipped. Some customers have a bill and hold arrangement with the Company. Revenue for bill and hold arrangements is recognized when control transfers to the customer, even though the customer does not have physical possession of the goods. Control transfers when the bill-and-hold arrangement has been requested from the customer, the product is identified as belonging to the customer and is ready for physical transfer, and the product cannot be directed for use by anyone but the customer. Payment terms and conditions vary by contract, although terms generally include a requirement of payment within ninety days of delivery. The Company evaluated the terms of the warranties and guarantees offered by its manufacturing businesses and determined that these should not be accounted for as a separate performance obligation as a distinct service is not identified. Healthcare Revenue. The Company contracts with patients to provide home health or hospice services. Payment is typically received from third party payors such as Medicare, Medicaid, and private insurers. The payor is a third party to the contract that stipulates the transaction price of the contract. The Company identifies the patient as the party who benefits from its healthcare services and as such, the patient is its customer. The Company determined that healthcare services contracts generally have one performance obligation to provide healthcare services to patients. The transaction price reflects the amount of revenue the Company expects to receive in exchange for providing these services. As the transaction price for healthcare services is known at the time of contract inception, no variable consideration exists. Healthcare revenue is recognized ratably over the period of care. The Company generally uses the time-elapsed method, an input measure as it best depicts the simultaneous delivery and consumption of healthcare services. Payment is received from third party payors within sixty days after a claim is filed, or in some cases in two installments, one during the contract and one after the services have been provided. Medicare is the most common third party payor. Home health revenue contracts may be modified to account for changes in the patient’s plan of care. The Company identifies contract modifications when the modification changes the existing enforceable rights and obligations. As modifications to the plan of care modify the original performance obligation, the Company accounts for the contract modification as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis. Other Revenue . The Company recognizes revenue associated with management services it provides to its affiliates. The Company accounts for the management services provided as one performance obligation and recognizes revenue over time as the services are delivered. The Company uses the right to invoice practical expedient, an output method, as the Company’s right to revenue corresponds directly with the value delivered to the affiliate. As a result of the election to use the right to invoice practical expedient, the Company does not determine the transaction price or allocate any variable consideration at contract inception. Rather, the Company recognizes revenue commensurate with the amount to which it has the right to invoice the affiliate which is based on contractually identified percentages. Payment is received monthly in arrears. SocialCode Revenue. SocialCode generates media management revenue in exchange for providing social media marketing solutions to its clients. The Company determined that SocialCode contracts generally have one performance obligation made up of a series of promises to manage the client’s media spend on advertising platforms for the duration of the contract period. SocialCode recognizes revenue, net of media acquisition costs, over time as media management services are delivered to the customer. Generally, SocialCode recognizes revenue using the right to invoice practical expedient, an output method, as SocialCode’s right to revenue corresponds directly with the value delivered to its customer. As a result of the election to use the right to invoice practical expedient, SocialCode does not determine the transaction price or allocate any variable consideration at contract inception. Rather, SocialCode recognizes revenue commensurate with the amount to which it has the right to invoice the customer which is a function of the cost of social media placement plus a management fee, less any applicable discounts. Payment is typically received within forty-five days of revenue recognition. SocialCode evaluates whether it is the principal (i.e. presents revenue on a gross basis) or agent (i.e. presents revenue on a net basis) in its contracts. SocialCode presents revenue for media management services net of media acquisition costs, as an agent, as SocialCode does not control the media before placement on social media platforms. Other Revenue. Other revenue primarily includes advertising and circulation revenue from Slate, Panoply and Foreign Policy. The Company accounts for other advertising revenues consistently with the advertising revenue streams addressed above. Circulation revenue consists of fees that provide customers access to online and print publications. The Company recognizes circulation revenue ratably over the subscription period beginning on the date that the publication is made available to the customer. Circulation revenue contracts are generally annual or monthly subscription contracts that are paid in advance of delivery of performance obligations. Accounting Policy Elections. The Company has elected to account for shipping and handling activities that occur after the customer has obtained control of the good as a fulfillment cost rather than as an additional promised service. Therefore, revenue for these performance obligations is recognized when control of the good transfers to the customer, which is when the good is ready for shipment. The Company accrues the related shipping and handling costs over the period when revenue is recognized. The Company has elected to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer. Practical Expedients. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, (ii) contracts for which the amount of revenue recognized is based on the amount to which the Company has the right to invoice the customer for services performed, (iii) contracts for which the consideration received is a usage-based royalty promised in exchange for a license of intellectual property and (iv) contracts for which variable consideration is allocated entirely to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation. With the exception of the education division, the Company expenses costs to obtain a contract as incurred as all contracts are less than one year. Deferred Revenue. The Company records deferred revenue when cash payments are received or due in advance of the Company’s performance, including amounts which are refundable. The following table presents the change in the Company’s deferred revenue balance during the nine months ended September 30, 2018 : As of September 30, January 1, % (in thousands) Change Deferred revenue $ 337,964 $ 342,640 (1) The majority of the change in the deferred revenue balance is related to the KU Transaction and cyclical nature of services at the Kaplan international division. During the nine months ended September 30, 2018 , the Company recognized $239.6 million related to the Company’s deferred revenue balance as of January 1, 2018. Costs to Obtain a Contract. The Company incurs costs to obtain a contract that are both incremental and expected to be recovered as the costs would not have been incurred if the contract was not obtained and the revenue from the contract exceeds the associated cost. The revenue guidance provides a practical expedient to expense sales commissions as incurred in instances where the amortization period is one year or less. The amortization period is defined in the guidance as the contract term, inclusive of any expected contract renewal periods. The Company has elected to apply this practical expedient to all contracts except for contracts in its education division. In the education division costs to obtain a contract are amortized over the applicable amortization period except for cases in which commissions paid on initial contracts and renewals are commensurate. The Company amortizes these costs to obtain a contract on a straight line basis over the amortization period. These expenses are included as operating expenses in the Company’s Condensed Consolidated Statement of Operations. The following table presents changes in the Company’s costs to obtain a contract asset during the nine months ended September 30, 2018 : (in thousands) Balance at Beginning of Period Costs associated with new contracts Less: Costs amortized during the period Other Balance at End of Period 2018 $ 16,043 $ 32,827 $ (33,642 ) $ (540 ) $ 14,688 The majority of other activity is related to currency translation adjustments during the nine months ended September 30, 2018 . Amortization expense for costs to obtain a contract was $10.9 million for the three months ended September 30, 2018 . |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS 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 net income and share data used in the basic and diluted earnings per share computations using the two-class method: Three Months Ended Nine Months Ended (in thousands, except per share amounts) 2018 2017 2018 2017 Numerator: Numerator for basic earnings per share: Net income attributable to Graham Holdings Company common stockholders $ 125,064 $ 24,784 $ 214,521 $ 87,866 Less: Dividends paid-common stock outstanding and unvested restricted shares (7,048 ) (7,047 ) (28,635 ) (28,329 ) Undistributed earnings 118,016 17,737 185,886 59,537 Percent allocated to common stockholders 99.34 % 99.07 % 99.34 % 99.07 % 117,235 17,572 184,657 58,981 Add: Dividends paid-common stock outstanding 7,001 6,981 28,447 28,066 Numerator for basic earnings per share $ 124,236 $ 24,553 $ 213,104 $ 87,047 Add: Additional undistributed earnings due to dilutive stock options 5 1 8 4 Numerator for diluted earnings per share $ 124,241 $ 24,554 $ 213,112 $ 87,051 Denominator: Denominator for basic earnings per share: Weighted average shares outstanding 5,302 5,518 5,354 5,530 Add: Effect of dilutive stock options 35 36 36 37 Denominator for diluted earnings per share 5,337 5,554 5,390 5,567 Graham Holdings Company Common Stockholders: Basic earnings per share $ 23.43 $ 4.45 $ 39.81 $ 15.74 Diluted earnings per share $ 23.28 $ 4.42 $ 39.54 $ 15.64 Diluted earnings 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) 2018 2017 2018 2017 Weighted average restricted stock 21 30 23 29 The diluted earnings per share amounts for the three and nine months ended September 30, 2018 and September 30, 2017 exclude the effects of 104,000 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, 2018 and September 30, 2017 exclude the effects of 5,250 restricted stock awards, as their inclusion would have been antidilutive due to a performance condition. In the three and nine months ended September 30, 2018 , the Company declared regular dividends totaling $1.33 and $5.32 per common share, respectively. In the three and nine months ended September 30, 2017 , the Company declared regular dividends totaling $1.27 and $5.08 per common share, respectively. |
Pension and Postretirement Plan
Pension and Postretirement Plans | 9 Months Ended |
Sep. 30, 2018 | |
Retirement Benefits, Description [Abstract] | |
Pension and Postretirement Plans | PENSION AND POSTRETIREMENT PLANS In the first quarter of 2018, the Company adopted new guidance which requires the presentation of service cost in the same line item as other compensation costs arising from services by employees during the period, while the other components of the net periodic benefit are recognized in non-operating pension and postretirement benefit income in the Company’s Condensed Consolidated Statement of Operations. On March 22, 2018, the Company eliminated the accrual of pension benefits for certain Kaplan University employees related to their future service. As a result, the Company remeasured the accumulated and projected benefit obligation of the pension plan as of March 22, 2018, and the Company recorded a curtailment gain in the first quarter of 2018. The new measurement basis was used for the recognition of the Company’s pension benefit following the remeasurement. The curtailment gain on the Kaplan University transaction is included in the gain on the Kaplan University transaction and reported in Other income, net on the Condensed Consolidated Statement of Operations. Defined Benefit Plans. The total benefit arising from the Company’s defined benefit pension plans consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2018 2017 2018 2017 Service cost $ 4,473 $ 4,591 $ 13,730 $ 14,096 Interest cost 11,844 11,980 34,943 35,945 Expected return on assets (31,969 ) (30,338 ) (97,251 ) (91,078 ) Amortization of prior service cost 36 42 114 128 Recognized actuarial gain (2,974 ) (1,039 ) (6,994 ) (3,372 ) Net Periodic Benefit (18,590 ) (14,764 ) (55,458 ) (44,281 ) Curtailment gain — — (806 ) — Special separation benefit expense — 932 — 932 Total Benefit $ (18,590 ) $ (13,832 ) $ (56,264 ) $ (43,349 ) In the third quarter of 2017, the Company recorded $0.9 million related to a Separation Incentive Program for certain Forney 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) consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2018 2017 2018 2017 Service cost $ 205 $ 214 $ 614 $ 643 Interest cost 967 1,059 2,899 3,175 Amortization of prior service cost 77 114 233 342 Recognized actuarial loss 600 444 1,802 1,331 Net Periodic Cost $ 1,849 $ 1,831 $ 5,548 $ 5,491 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 52 % 53 % U.S. stock index fund 31 % 30 % U.S. fixed income 11 % 11 % International equities 6 % 6 % 100 % 100 % The Company manages approximately 45% 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 55% of plan assets are 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, 2018 , 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, 2018 . 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, 2018 and December 31, 2017 , the pension plan held investments in one common stock and one U.S. stock index fund that exceeded 10% of total plan assets. These investments were valued at $1,154.4 million and $1,079.3 million at September 30, 2018 and December 31, 2017 , respectively, or approximately 46% 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) 2018 2017 2018 2017 Service cost $ 267 $ 257 $ 803 $ 771 Interest cost 170 195 509 584 Amortization of prior service credit (44 ) (38 ) (132 ) (112 ) Recognized actuarial gain (921 ) (972 ) (2,764 ) (2,917 ) Net Periodic Benefit $ (528 ) $ (558 ) $ (1,584 ) $ (1,674 ) |
Other Non-Operating Income
Other Non-Operating Income | 9 Months Ended |
Sep. 30, 2018 | |
Other Nonoperating Income (Expense) [Abstract] | |
Other Non-Operating Income | OTHER NON-OPERATING INCOME A summary of non-operating income is as follows: Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Gain on cost method investments $ 8,487 $ — $ 8,487 $ — Impairment of cost method investments (2,500 ) (200 ) (2,500 ) (200 ) Gain (loss) on sales of businesses 916 — 8,157 (342 ) Gain on sale of a cost method investment — — 2,845 — Gain on sale of land — — 2,542 — Foreign currency (loss) gain, net (116 ) 1,414 (2,205 ) 6,608 Other, net (3,645 ) 749 (2,664 ) 815 Total Other Non-Operating Income $ 3,142 $ 1,963 $ 14,662 $ 6,881 In the third quarter of 2018, the Company recorded an $8.5 million gain resulting from observable price changes in the fair value of equity securities accounted for under the cost method. In the first nine months of 2018 , the Company recorded an $8.2 million gain on the sale of three businesses in the education division, including a gain of $4.3 million on the Kaplan University transaction and $1.9 million in contingent consideration gains related to the sale of a business (see Note 2). |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The other comprehensive (loss) income consists of the following components: Three Months Ended September 30 2018 2017 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 $ (2,844 ) $ — $ (2,844 ) $ 11,470 $ — $ 11,470 Unrealized gains on available-for-sale securities: Unrealized gains for the period, net — — — 47,836 (19,134 ) 28,702 Pension and other postretirement plans: Amortization of net prior service cost included in net income 69 (18 ) 51 118 (47 ) 71 Amortization of net actuarial gain included in net income (3,295 ) 891 (2,404 ) (1,567 ) 627 (940 ) (3,226 ) 873 (2,353 ) (1,449 ) 580 (869 ) Cash flow hedge: Loss for the period (6 ) 1 (5 ) (72 ) 14 (58 ) Other Comprehensive (Loss) Income $ (6,076 ) $ 874 $ (5,202 ) $ 57,785 $ (18,540 ) $ 39,245 Nine Months Ended September 30 2018 2017 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 $ (22,447 ) $ — $ (22,447 ) $ 34,776 $ — $ 34,776 Unrealized gains on available-for-sale securities: Unrealized gains for the period, net — — — 71,370 (28,548 ) 42,822 Pension and other postretirement plans: Amortization of net prior service cost included in net income 215 (58 ) 157 358 (143 ) 215 Amortization of net actuarial gain included in net income (7,956 ) 2,148 (5,808 ) (4,958 ) 1,983 (2,975 ) (7,741 ) 2,090 (5,651 ) (4,600 ) 1,840 (2,760 ) Cash flow hedge: Gain (loss) for the period 601 (114 ) 487 (215 ) 43 (172 ) Other Comprehensive (Loss) Income $ (29,587 ) $ 1,976 $ (27,611 ) $ 101,331 $ (26,665 ) $ 74,666 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 (Loss) Balance as of December 31, 2017 $ 6,314 $ 194,889 $ 334,536 $ (184 ) $ 535,555 Reclassification of unrealized gains on available-for-sale-securities to retained earnings as a result of adoption of new guidance — (194,889 ) — — (194,889 ) Other comprehensive (loss) income before reclassifications (22,447 ) — — 569 (21,878 ) Net amount reclassified from accumulated other comprehensive income (loss) — — (5,651 ) (82 ) (5,733 ) Other comprehensive (loss) income, net of tax (22,447 ) — (5,651 ) 487 (27,611 ) Balance as of September 30, 2018 $ (16,133 ) $ — $ 328,885 $ 303 $ 313,055 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) 2018 2017 2018 2017 Pension and Other Postretirement Plans: Amortization of net prior service cost $ 69 $ 118 $ 215 $ 358 (1) Amortization of net actuarial gain (3,295 ) (1,567 ) (7,956 ) (4,958 ) (1) (3,226 ) (1,449 ) (7,741 ) (4,600 ) Before tax 873 580 2,090 1,840 Provision for Income Taxes (2,353 ) (869 ) (5,651 ) (2,760 ) Net of Tax Cash Flow Hedge (59 ) 51 (101 ) 123 Interest expense 11 (11 ) 19 (25 ) Provision for Income Taxes (48 ) 40 (82 ) 98 Net of Tax Total reclassification for the period $ (2,401 ) $ (829 ) $ (5,733 ) $ (2,662 ) Net of Tax ____________ (1) These accumulated other comprehensive income components are components of net periodic pension and postretirement plan cost (see Note 12) and are included in non-operating pension and postretirement benefit income in the Company’s Condensed Consolidated Statements of Operations. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | CONTINGENCIES Litigation, Legal and Other Matters . The Company and its subsidiaries are subject to complaints and administrative proceedings and are defendants in various civil lawsuits that have arisen in the ordinary course of their businesses, including contract disputes; actions alleging negligence, libel, defamation, invasion of privacy; trademark, copyright and patent infringement; U.S. False Claims Act (False Claims Act) violations; violations of applicable wage and hour laws; and statutory or common law claims involving current and former students and employees. 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. However, based on currently available information, management believes it is reasonably possible that future losses from existing and threatened legal, regulatory and other proceedings in excess of the amounts recorded could reach approximately $45 million . Her Majesty’s Revenue and Customs (HMRC), a department of the U.K. government responsible for the collection of taxes, has raised assessments against the Kaplan U.K. Pathways business for Value Added Tax (VAT) relating to 2017 and earlier years, which have been paid by Kaplan. Kaplan is continuing to pay the disputed VAT for subsequent periods. Kaplan has challenged these assessments and the case is currently on appeal to a tax tribunal with a hearing expected in January 2019. The Company believes it has met all requirements under U.K. VAT law and expects to recover the £15.4 million receivable related to the assessments that have been paid. If the Company does not prevail in this case, a pre-tax charge of £15.4 million will be recorded to operating expense in the Company’s condensed consolidated statement of operations. In March 2018, HMRC issued VAT guidance with an effective date of May 31, 2018 that could impact the U.K. Pathways business if this guidance were to become law; this new guidance is separate from the VAT case discussed above. The Company is in the process of reviewing this new guidance, and considering the possibility that this guidance could be part of U.K. legislation in the future. If the Company is not successful in preserving a valid exemption under U.K. VAT law, the U.K Pathways business would incur additional VAT expense in the future. In connection with the sale of the KHE Campuses business in September 2015, Kaplan is secondarily liable on a number of leases that were transferred to the buyer, Education Corporation of America (ECA); the leases run through 2024 with commitments totaling approximately $16.3 million at September 30, 2018. In September 2018, ECA announced plans to close a number of its campuses and teach out certain programs. In October 2018, ECA filed in Federal Court for receivership in pursuit of a plan to reorganize its business and continue operations. If ECA is unsuccessful in its reorganization plan, the Company would become primarily liable under the transferred leases. Department of Education (ED) Program Reviews. The ED has undertaken program reviews at various KHE locations. On February 23, 2015, the ED began a review of Kaplan University (KU). The review relates to Kaplan’s administration of its Title IV and Higher Education Act programs and the initial focus was on the 2013 to 2014 and 2014 to 2015 award years. In September 2018, the ED issued a preliminary report with respect to this program review that included a number of findings related to Return to Title IV Funds as discussed in the Company’s 2017 Annual Report on Form 10-K. The preliminary report also included requests for additional information related to student attendance and other areas. While the Company does not expect this open program review to have a material impact on KHE, the Company cannot predict the final outcome of this review, when it will be completed or any liability or other limitations that the ED may place on KHE as a result of this review. In addition, there are two open program reviews at campuses that were part of the KHE Campuses business prior to its sale in 2015 to Education Corporation of America (ECA), and we await the ED’s final reports on the program reviews at former KHE Broomall, PA; and Pittsburgh, PA, locations. Kaplan retains responsibility for any financial obligation resulting from the ED program reviews at KU and KHE Campuses business that were open at the time of sale. 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. |
Business Segments
Business Segments | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Business Segments | BUSINESS SEGMENTS As a result of the Kaplan University transaction, the Company reorganized its operations in the first quarter of 2018 into the following six reportable segments for the purpose of making operating decisions and assessing performance: Kaplan International, Kaplan Higher Education, Kaplan Test Preparation, Kaplan Professional (U.S.), Television Broadcasting and Healthcare. Kaplan reorganized its higher education operations into the following two operating segments: Higher Education and Professional (U.S.). The higher education segment comprises the historical KU for-profit postsecondary education business and the current non-academic operations support services provided to the new university, Purdue University Global. The Professional (U.S.) segment comprises the KU School of Professional and Continuing Education, which provides professional training and exam preparation for professional certifications and licensures. The business segments disclosed in the condensed consolidated financial statements are based on this new organizational structure and information reviewed by the Company’s management to evaluate the business segment results. Segment operating results have been restated to reflect this organizational change. The following table summarizes the financial information related to each of the Company’s business segments: Three Months Ended Nine months ended September 30 September 30 (in thousands) 2018 2017 2018 2017 Operating Revenues Education $ 358,601 $ 376,805 $ 1,104,105 $ 1,136,201 Television broadcasting 130,014 101,295 352,902 298,893 Healthcare 35,486 40,473 111,315 115,592 Other businesses 150,665 138,652 438,602 365,343 Corporate office — — — — Intersegment elimination — — (45 ) — $ 674,766 $ 657,225 $ 2,006,879 $ 1,916,029 Income (Loss) from Operations Education $ 22,262 $ 13,797 $ 82,516 $ 56,565 Television broadcasting 55,453 33,462 137,113 99,722 Healthcare (8,702 ) 920 (9,329 ) 378 Other businesses 4,613 (7,021 ) (136 ) (25,961 ) Corporate office (12,887 ) (14,208 ) (39,585 ) (43,760 ) $ 60,739 $ 26,950 $ 170,579 $ 86,944 Equity in Earnings (Losses) of Affiliates, Net 9,537 (532 ) 13,047 1,448 Interest Expense, Net (5,524 ) (7,758 ) (27,487 ) (22,386 ) Debt Extinguishment Costs — — (11,378 ) — Non-Operating Pension and Postretirement Benefit Income, Net 22,214 17,621 66,641 55,042 Loss on Marketable Equity Securities, Net 44,962 — 28,306 — Other Income, Net 3,142 1,963 14,662 6,881 Income Before Income Taxes $ 135,070 $ 38,244 $ 254,370 $ 127,929 Depreciation of Property, Plant and Equipment Education $ 6,685 $ 8,085 $ 21,130 $ 24,994 Television broadcasting 3,198 3,118 9,243 8,703 Healthcare 648 1,166 1,948 3,429 Other businesses 2,865 3,354 8,830 8,539 Corporate office 252 279 758 860 $ 13,648 $ 16,002 $ 41,909 $ 46,525 Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets Education $ 2,682 $ 1,355 $ 5,494 $ 3,798 Television broadcasting 1,408 1,071 4,224 2,943 Healthcare 9,839 2,420 13,456 5,718 Other businesses 6,449 6,389 18,987 25,367 Corporate office — — — — $ 20,378 $ 11,235 $ 42,161 $ 37,826 Pension Expense Education $ 2,107 $ 2,430 $ 6,649 $ 7,289 Television broadcasting 544 485 1,638 1,457 Healthcare 143 166 430 498 Other businesses 346 277 1,013 843 Corporate office 1,333 1,233 4,000 4,009 $ 4,473 $ 4,591 $ 13,730 $ 14,096 Asset information for the Company’s business segments are as follows: As of (in thousands) September 30, 2018 December 31, 2017 Identifiable Assets Education $ 1,599,680 $ 1,592,097 Television broadcasting 455,746 455,884 Healthcare 108,685 129,856 Other businesses 819,419 855,399 Corporate office 143,416 182,905 $ 3,126,946 $ 3,216,141 Marketable Equity Securities 497,879 536,315 Investments in Affiliates 142,756 128,590 Prepaid Pension Cost 1,106,162 1,056,777 Total Assets $ 4,873,743 $ 4,937,823 The Company’s education division comprises the following operating segments: Three Months Ended Nine months ended September 30 September 30 (in thousands) 2018 2017 2018 2017 Operating Revenues Kaplan international $ 167,668 $ 171,259 $ 535,553 $ 507,568 Higher education 89,269 105,210 275,080 328,161 Test preparation 67,749 72,680 195,504 212,978 Professional (U.S.) 34,302 28,249 98,715 88,812 Kaplan corporate and other 143 49 870 120 Intersegment elimination (530 ) (642 ) (1,617 ) (1,438 ) $ 358,601 $ 376,805 $ 1,104,105 $ 1,136,201 Income (Loss) from Operations Kaplan international $ 8,375 $ 5,348 $ 52,966 $ 29,009 Higher education 6,042 1,493 18,616 17,079 Test preparation 10,572 7,330 17,213 10,207 Professional (U.S.) 6,768 7,316 20,863 22,045 Kaplan corporate and other (9,452 ) (7,631 ) (27,110 ) (21,739 ) Intersegment elimination (43 ) (59 ) (32 ) (36 ) $ 22,262 $ 13,797 $ 82,516 $ 56,565 Depreciation of Property, Plant and Equipment Kaplan international $ 3,759 $ 3,780 $ 11,497 $ 11,071 Higher education 915 2,010 4,047 7,142 Test preparation 1,033 1,407 2,984 4,080 Professional (U.S.) 859 758 2,171 2,306 Kaplan corporate and other 119 130 431 395 $ 6,685 $ 8,085 $ 21,130 $ 24,994 Amortization of Intangible Assets $ 2,682 $ 1,355 $ 5,494 $ 3,798 Pension Expense Kaplan international $ 66 $ 24 $ 233 $ 198 Higher education 1,050 467 3,260 3,951 Test preparation 577 244 2,035 2,066 Professional (U.S.) 291 81 871 685 Kaplan corporate and other 123 1,614 250 389 $ 2,107 $ 2,430 $ 6,649 $ 7,289 Asset information for the Company’s education division is as follows: As of (in thousands) September 30, 2018 December 31, 2017 Identifiable assets Kaplan international $ 1,109,470 $ 1,115,919 Higher education 144,274 231,986 Test preparation 155,846 130,938 Professional (U.S.) 160,120 91,630 Kaplan corporate and other 29,970 21,624 $ 1,599,680 $ 1,592,097 |
Organization, Basis of Presen_2
Organization, Basis of Presentation And Recent Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
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, 2018 and 2017 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 Current Report on Form 8-K filed on May 21, 2018. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. |
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. The standard permits two implementation approaches, full retrospective, requiring retrospective application of the new guidance with a restatement of prior years, or modified retrospective, requiring prospective application of the new guidance with disclosure of results under the old guidance in the first year of adoption. The Company adopted the new guidance on January 1, 2018 using the modified retrospective approach for contracts not completed as of the adoption date. Upon adoption of the new guidance, the Company recorded a net increase to the opening balance of retained earnings of $7.4 million . This adjustment was driven by changes in the timing of recognition of both revenues and expenses. A change in revenue recognition at a manufacturing business resulted in the acceleration of revenue and associated expenses as revenue is now recognized over time versus at a point in time. A change in the contract term at an education business resulted in a different revenue recognition pattern from previous recognition. Finally, the Company’s treatment of certain commissions paid to employees and agents at its education division changed. The Company previously expensed such commissions as incurred. Upon adoption of the new guidance, the Company capitalizes certain commission costs as an incremental cost of obtaining a contract and subsequently amortizes the cost as the tuition services are delivered to students. The cumulative effect of the changes to the Company’s Condensed Consolidated Balance Sheet as a result of adopting the new guidance was as follows: (in thousands) Balance as of December 31, 2017 Adjustments Balance as of January 1, 2018 Assets Accounts receivable, net $ 620,319 $ 2,142 $ 622,461 Inventories and contracts in progress 60,612 903 61,515 Other current assets 66,253 6,343 72,596 Liabilities Accounts payable and accrued liabilities $ 526,323 $ 88 $ 526,411 Deferred revenue 339,454 (346 ) 339,108 Deferred income taxes 362,701 2,197 364,898 Equity Retained earnings $ 5,791,724 $ 7,449 $ 5,799,173 Under the modified retrospective method of adoption, the Company is required to disclose the impact the adoption of the revenue guidance had on its Condensed Consolidated Statement of Operations. Under the previous guidance, KU’s fee revenue with Purdue University Global is not fixed and determinable until the end of Purdue University Global’s fiscal year (see Note 2). As a result, the Company would report $4.5 million less revenue and operating income. If the company continued to follow its accounting policies under the previous guidance for all other revenue streams, revenue would be $0.1 million higher and expenses would be $ 1.8 million lower for the quarter ended September 30, 2018 . For the nine months ended September 30, 2018 , revenue and expenses would be $1.2 million and $2.6 million lower, respectively. This is primarily due to the net impact of the change in the timing of the recognition of revenue and costs to obtain a contract. 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. The Company adopted this guidance in the first quarter of 2018 and recorded a cumulative adjustment of $194.9 million to retained earnings on its Condensed Consolidated Balance Sheet related to unrealized gains of available-for-sale securities, net of tax, previously classified within accumulated other comprehensive income. Results for reporting periods beginning after January 1, 2018 are presented under this new guidance, with any changes in fair value recognized in net income. In addition, the Company elected the measurement alternative to measure cost method investments that do not have a readily determinable fair value at cost less impairment, adjusted by observable price changes with any fair value changes recognized in net income. 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 provides two methods of adoption. Using a modified retrospective approach, lessees and lessors are required to recognize and measure leases at either the beginning of the earliest period presented or in the period of adoption. The Company will adopt the new guidance on January 1, 2019 and will recognize and measure leases at that date. The Company is in the process of evaluating the impact of this new guidance on its Condensed Consolidated Financial Statements; however, the recognition of right-of-use assets and lease liabilities is expected to have a material effect on its Condensed Consolidated Balance Sheet. In March 2017, the FASB issued new guidance that changes the presentation of net periodic pension cost and net periodic postretirement benefit cost for defined benefit plans. The guidance requires an issuer to disaggregate the service cost component of net periodic pension and postretirement benefit cost from other components. Under the new guidance, service cost will be included in the same line item(s) as other compensation costs arising from services rendered by employees during the period, while the other components will be recognized after income from operations. The guidance is effective for interim and fiscal years beginning after December 15, 2017. The guidance must be applied retrospectively; however, a practical expedient is available which permits an employer to use amounts previously disclosed in its pension and postretirement plans footnote for the prior comparative periods. The Company adopted the new standard in the first quarter of 2018. In combination with the presentation change to net periodic pension cost and net periodic postretirement benefit cost, the Company allocated its costs associated with fringe benefits between operating expenses and selling, general and administrative expenses. Previously, costs related to fringe benefits were generally classified as selling, general and administrative expenses. The amounts in the previously issued financial statements have been reclassified to conform to the reclassified presentation. The effect of these changes to the Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2017 is as follows: As Previously Reported Adjustment Upon Adoption (in thousands) Three Months Ended September 30, 2017 Operating expenses $ 352,635 $ 22,352 $ 374,987 Selling, general and administrative expenses 232,782 (4,731 ) 228,051 Income from Operations 44,571 (17,621 ) 26,950 Non-operating pension and postretirement benefit income, net — 17,621 17,621 Income Before Income Taxes 38,244 — 38,244 Nine Months Ended September 30, 2017 Operating expenses $ 1,011,553 $ 70,868 $ 1,082,421 Selling, general and administrative expenses 678,139 (15,826 ) 662,313 Income from Operations 141,986 (55,042 ) 86,944 Non-operating pension and postretirement benefit income, net — 55,042 55,042 Income Before Income Taxes 127,929 — 127,929 |
Organization, Basis of Presen_3
Organization, Basis of Presentation and Recent Accounting Pronouncements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
New Accounting Pronouncement, Early Adoption [Line Items] | |
Schedule of Prospective Adoption of New Accounting Pronouncements | The cumulative effect of the changes to the Company’s Condensed Consolidated Balance Sheet as a result of adopting the new guidance was as follows: (in thousands) Balance as of December 31, 2017 Adjustments Balance as of January 1, 2018 Assets Accounts receivable, net $ 620,319 $ 2,142 $ 622,461 Inventories and contracts in progress 60,612 903 61,515 Other current assets 66,253 6,343 72,596 Liabilities Accounts payable and accrued liabilities $ 526,323 $ 88 $ 526,411 Deferred revenue 339,454 (346 ) 339,108 Deferred income taxes 362,701 2,197 364,898 Equity Retained earnings $ 5,791,724 $ 7,449 $ 5,799,173 |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The effect of these changes to the Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2017 is as follows: As Previously Reported Adjustment Upon Adoption (in thousands) Three Months Ended September 30, 2017 Operating expenses $ 352,635 $ 22,352 $ 374,987 Selling, general and administrative expenses 232,782 (4,731 ) 228,051 Income from Operations 44,571 (17,621 ) 26,950 Non-operating pension and postretirement benefit income, net — 17,621 17,621 Income Before Income Taxes 38,244 — 38,244 Nine Months Ended September 30, 2017 Operating expenses $ 1,011,553 $ 70,868 $ 1,082,421 Selling, general and administrative expenses 678,139 (15,826 ) 662,313 Income from Operations 141,986 (55,042 ) 86,944 Non-operating pension and postretirement benefit income, net — 55,042 55,042 Income Before Income Taxes 127,929 — 127,929 |
Acquisitions and Dispositions_2
Acquisitions and Dispositions of Businesses (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Acquisitions And Dispositions [Abstract] | |
Schedule of assets acquired and liabilities assumed | The aggregate purchase price of the 2018 and 2017 acquisitions was allocated as follows (2018 on a preliminary basis): Purchase Price Allocation Nine Months Ended Twelve Months Ended (in thousands) September 30, 2018 December 31, 2017 Accounts receivable $ 2,334 $ 12,502 Inventory 1,268 25,253 Property, plant and equipment 1,518 29,921 Goodwill 41,397 143,149 Indefinite-lived intangible assets 14,200 33,800 Amortized intangible assets 64,327 170,658 Other assets 4,912 1,880 Pension and other postretirement benefits liabilities — (59,116 ) Other liabilities (7,575 ) (12,177 ) Deferred income taxes (4,460 ) (37,289 ) Redeemable noncontrolling interest — (3,666 ) Aggregate purchase price, net of cash acquired $ 117,921 $ 304,915 |
Acquisition Pro Forma Financial Information | The following unaudited pro forma financial information presents the Company’s results as if the 2018 acquisitions had occurred at the beginning of 2017 . The unaudited pro forma information also includes the 2017 acquisitions as if they occurred at the beginning of 2016 : Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Operating revenues $ 680,279 $ 674,991 $ 2,046,792 $ 2,033,078 Net income 126,104 25,896 219,092 98,564 |
Information related to Disposal Group | The revenue and operating income related to the KU business disposed of are as follows: Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Revenue $ — $ 105,036 $ 91,526 $ 327,529 Operating income — 1,785 213 18,582 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
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 $ 239,904 $ 269,343 Gross unrealized gains 257,975 266,972 Total Fair Value $ 497,879 $ 536,315 |
Gain on Marketable Equity Securities | The gain on marketable equity securities comprised the following: Three Months Ended Nine Months Ended (in thousands) September 30, 2018 September 30, 2018 Gain on marketable equity securities, net $ 44,962 $ 28,306 Plus: Net losses in earnings from marketable equity securities sold — 4,271 Net unrealized gains in earnings from marketable equity securities still held at the end of the period $ 44,962 $ 32,577 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounts and Notes Receivable, Net [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable consist of the following: As of September 30, December 31, (in thousands) Receivables from contracts with customers, less doubtful accounts of $14,453 and $22,975 $ 544,487 $ 600,215 Other receivables 45,158 20,104 $ 589,645 $ 620,319 |
Inventories and Contracts in _2
Inventories and Contracts in Progress (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Inventory, Net of Allowances, Customer Advances and Progress Billings [Abstract] | |
Schedule of Inventories and Contracts in Progress | Inventories and contracts in progress consist of the following: As of September 30, December 31, (in thousands) Raw materials $ 37,300 $ 30,429 Work-in-process 10,926 10,258 Finished goods 18,506 18,851 Contracts in progress 6,964 1,074 $ 73,696 $ 60,612 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill, by segment, were as follows: (in thousands) Education Television Broadcasting Healthcare Other Businesses Total Balance as of December 31, 2017 Goodwill $ 1,171,812 $ 190,815 $ 69,409 $ 233,825 $ 1,665,861 Accumulated impairment losses (350,850 ) — — (15,301 ) (366,151 ) 820,962 190,815 69,409 218,524 1,299,710 Acquisitions 19,981 — 217 21,199 41,397 Dispositions (11,191 ) — — — (11,191 ) Foreign currency exchange rate changes (19,841 ) — — — (19,841 ) Balance as of September 30, 2018 Goodwill 1,141,062 190,815 69,626 255,024 1,656,527 Accumulated impairment losses (331,151 ) — — (15,301 ) (346,452 ) $ 809,911 $ 190,815 $ 69,626 $ 239,723 $ 1,310,075 |
Other Intangible Assets | Other intangible assets consist of the following: As of September 30, 2018 As of December 31, 2017 (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 (1) $ 281,639 $ 106,235 $ 175,404 $ 260,464 $ 83,690 $ 176,774 Trade names and trademarks 2–10 years 71,870 37,858 34,012 50,286 25,596 24,690 Network affiliation agreements 10 years 17,400 2,972 14,428 17,400 1,668 15,732 Databases and technology 3–6 years 28,788 8,537 20,251 19,563 5,008 14,555 Noncompete agreements 2–5 years 1,093 778 315 930 467 463 Other 1–8 years 24,530 8,885 15,645 13,430 7,668 5,762 $ 425,320 $ 165,265 $ 260,055 $ 362,073 $ 124,097 $ 237,976 Indefinite-Lived Intangible Assets Trade names and trademarks $ 95,802 $ 82,745 FCC licenses 18,800 18,800 Licensure and accreditation 150 650 $ 114,752 $ 102,195 ____________ (1) As of December 31, 2017, the student and customer relationships’ minimum useful life was 1 year. |
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) Kaplan International Higher Education Test Preparation Professional (U.S.) Total Balance as of December 31, 2017 Goodwill $ 615,861 $ 205,494 $ 166,098 $ 184,359 $ 1,171,812 Accumulated impairment losses — (131,023 ) (102,259 ) (117,568 ) (350,850 ) 615,861 74,471 63,839 66,791 820,962 Acquisitions 26 — 626 19,329 19,981 Dispositions — (11,191 ) — — (11,191 ) Foreign currency exchange rate changes (19,775 ) (40 ) — (26 ) (19,841 ) Balance as of September 30, 2018 Goodwill 596,112 174,564 166,724 203,662 1,141,062 Accumulated impairment losses — (111,324 ) (102,259 ) (117,568 ) (331,151 ) $ 596,112 $ 63,240 $ 64,465 $ 86,094 $ 809,911 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Components of Debt | The Company’s borrowings consist of the following: As of September 30, December 31, (in thousands) 5.75% unsecured notes due June 1, 2026 (1) $ 394,504 $ — 7.25% unsecured notes due February 1, 2019 — 399,507 UK Credit facility (2) 85,024 93,671 Other indebtedness 100 109 Total Debt $ 479,628 $ 493,287 Less: current portion (6,568 ) (6,726 ) Total Long-Term Debt $ 473,060 $ 486,561 ___________ _ (1) The carrying value is net of $5.5 million of unamortized debt issuance costs as of September 30, 2018 . (2) The carrying value is net of $0.3 million and $0.4 million of unamortized debt issuance costs as of September 30, 2018 and December 31, 2017 , respectively. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
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, 2018 (in thousands) Level 1 Level 2 Total Assets Money market investments (1) $ — $ 85,999 $ 85,999 Marketable equity securities (2) 497,879 — 497,879 Other current investments (3) 13,069 6,979 20,048 Interest rate swap (4) — 418 418 Total Financial Assets $ 510,948 $ 93,396 $ 604,344 Liabilities Deferred compensation plan liabilities (5) $ — $ 38,154 $ 38,154 As of December 31, 2017 (in thousands) Level 1 Level 2 Level 3 Total Assets Money market investments (1) $ — $ 217,628 $ — $ 217,628 Marketable equity securities (2) 536,315 — — 536,315 Other current investments (3) 9,831 11,007 — 20,838 Total Financial Assets $ 546,146 $ 228,635 $ — $ 774,781 Liabilities Deferred compensation plan liabilities (5) $ — $ 43,414 $ — $ 43,414 Interest rate swap (6) — 244 — 244 Mandatorily redeemable noncontrolling interest (7) — — 10,331 10,331 Total Financial Liabilities $ — $ 43,658 $ 10,331 $ 53,989 ____________ (1) The Company’s money market investments are included in Cash and Cash Equivalents and Restricted Cash and the value considers the liquidity of the counterparty. (2) The Company’s investments in marketable equity securities are held in common shares of U.S. corporations that are actively traded on U.S. stock exchanges. Price quotes for these shares are readily available. Investments in marketable securities were classified as available-for-sale in 2017 prior to the adoption of the new accounting guidance (see Note 1). (3) 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 fair value hierarchy. (4) Included in Deferred Charges and Other Assets. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. (5) 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. (6) Included in Other Liabilities. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. (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. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue | The following table presents the Company’s revenue disaggregated by revenue source for the three and nine months ended September 30, 2018 and September 30, 2017 : Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Education Revenue Kaplan international $ 167,668 $ 171,259 $ 535,553 $ 507,568 Higher education 89,269 105,210 275,080 328,161 Test preparation 67,749 72,680 195,504 212,978 Professional (U.S.) 34,302 28,249 98,715 88,812 Kaplan corporate and other 143 49 870 120 Intersegment elimination (530 ) (642 ) (1,617 ) (1,438 ) 358,601 376,805 1,104,105 1,136,201 Television broadcasting 130,014 101,295 352,902 298,893 Manufacturing 126,028 115,594 369,896 298,164 Healthcare 35,486 40,473 111,315 115,592 SocialCode 13,781 14,497 41,850 41,926 Other 10,856 8,561 26,856 25,253 Intersegment elimination — — (45 ) — Total Revenue $ 674,766 $ 657,225 $ 2,006,879 $ 1,916,029 |
Contract with Customer, Liability [Abstract] | |
Contract with Customer, Asset and Liability | The following table presents the change in the Company’s deferred revenue balance during the nine months ended September 30, 2018 : As of September 30, January 1, % (in thousands) Change Deferred revenue $ 337,964 $ 342,640 (1) |
Capitalized Contract Cost [Line Items] | |
Capitalized Contract Cost | The following table presents changes in the Company’s costs to obtain a contract asset during the nine months ended September 30, 2018 : (in thousands) Balance at Beginning of Period Costs associated with new contracts Less: Costs amortized during the period Other Balance at End of Period 2018 $ 16,043 $ 32,827 $ (33,642 ) $ (540 ) $ 14,688 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Summary of Earnings Per Share, Basic and Diluted | The following reflects the Company’s net income and share data used in the basic and diluted earnings per share computations using the two-class method: Three Months Ended Nine Months Ended (in thousands, except per share amounts) 2018 2017 2018 2017 Numerator: Numerator for basic earnings per share: Net income attributable to Graham Holdings Company common stockholders $ 125,064 $ 24,784 $ 214,521 $ 87,866 Less: Dividends paid-common stock outstanding and unvested restricted shares (7,048 ) (7,047 ) (28,635 ) (28,329 ) Undistributed earnings 118,016 17,737 185,886 59,537 Percent allocated to common stockholders 99.34 % 99.07 % 99.34 % 99.07 % 117,235 17,572 184,657 58,981 Add: Dividends paid-common stock outstanding 7,001 6,981 28,447 28,066 Numerator for basic earnings per share $ 124,236 $ 24,553 $ 213,104 $ 87,047 Add: Additional undistributed earnings due to dilutive stock options 5 1 8 4 Numerator for diluted earnings per share $ 124,241 $ 24,554 $ 213,112 $ 87,051 Denominator: Denominator for basic earnings per share: Weighted average shares outstanding 5,302 5,518 5,354 5,530 Add: Effect of dilutive stock options 35 36 36 37 Denominator for diluted earnings per share 5,337 5,554 5,390 5,567 Graham Holdings Company Common Stockholders: Basic earnings per share $ 23.43 $ 4.45 $ 39.81 $ 15.74 Diluted earnings per share $ 23.28 $ 4.42 $ 39.54 $ 15.64 |
Antidilutive Weighted Average Restricted Stock and Options | Diluted earnings 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) 2018 2017 2018 2017 Weighted average restricted stock 21 30 23 29 |
Pension and Postretirement Pl_2
Pension and Postretirement Plans (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
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 consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2018 2017 2018 2017 Service cost $ 4,473 $ 4,591 $ 13,730 $ 14,096 Interest cost 11,844 11,980 34,943 35,945 Expected return on assets (31,969 ) (30,338 ) (97,251 ) (91,078 ) Amortization of prior service cost 36 42 114 128 Recognized actuarial gain (2,974 ) (1,039 ) (6,994 ) (3,372 ) Net Periodic Benefit (18,590 ) (14,764 ) (55,458 ) (44,281 ) Curtailment gain — — (806 ) — Special separation benefit expense — 932 — 932 Total Benefit $ (18,590 ) $ (13,832 ) $ (56,264 ) $ (43,349 ) |
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 52 % 53 % U.S. stock index fund 31 % 30 % U.S. fixed income 11 % 11 % International equities 6 % 6 % 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) consists of the following components: Three Months Ended September 30 Nine Months Ended September 30 (in thousands) 2018 2017 2018 2017 Service cost $ 205 $ 214 $ 614 $ 643 Interest cost 967 1,059 2,899 3,175 Amortization of prior service cost 77 114 233 342 Recognized actuarial loss 600 444 1,802 1,331 Net Periodic Cost $ 1,849 $ 1,831 $ 5,548 $ 5,491 |
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) 2018 2017 2018 2017 Service cost $ 267 $ 257 $ 803 $ 771 Interest cost 170 195 509 584 Amortization of prior service credit (44 ) (38 ) (132 ) (112 ) Recognized actuarial gain (921 ) (972 ) (2,764 ) (2,917 ) Net Periodic Benefit $ (528 ) $ (558 ) $ (1,584 ) $ (1,674 ) |
Other Non-Operating Income (Tab
Other Non-Operating Income (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Other Nonoperating Income (Expense) [Abstract] | |
Summary of non-operating income | A summary of non-operating income is as follows: Three Months Ended Nine Months Ended (in thousands) 2018 2017 2018 2017 Gain on cost method investments $ 8,487 $ — $ 8,487 $ — Impairment of cost method investments (2,500 ) (200 ) (2,500 ) (200 ) Gain (loss) on sales of businesses 916 — 8,157 (342 ) Gain on sale of a cost method investment — — 2,845 — Gain on sale of land — — 2,542 — Foreign currency (loss) gain, net (116 ) 1,414 (2,205 ) 6,608 Other, net (3,645 ) 749 (2,664 ) 815 Total Other Non-Operating Income $ 3,142 $ 1,963 $ 14,662 $ 6,881 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Summary of Other Comprehensive (Loss) Income | The other comprehensive (loss) income consists of the following components: Three Months Ended September 30 2018 2017 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 $ (2,844 ) $ — $ (2,844 ) $ 11,470 $ — $ 11,470 Unrealized gains on available-for-sale securities: Unrealized gains for the period, net — — — 47,836 (19,134 ) 28,702 Pension and other postretirement plans: Amortization of net prior service cost included in net income 69 (18 ) 51 118 (47 ) 71 Amortization of net actuarial gain included in net income (3,295 ) 891 (2,404 ) (1,567 ) 627 (940 ) (3,226 ) 873 (2,353 ) (1,449 ) 580 (869 ) Cash flow hedge: Loss for the period (6 ) 1 (5 ) (72 ) 14 (58 ) Other Comprehensive (Loss) Income $ (6,076 ) $ 874 $ (5,202 ) $ 57,785 $ (18,540 ) $ 39,245 Nine Months Ended September 30 2018 2017 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 $ (22,447 ) $ — $ (22,447 ) $ 34,776 $ — $ 34,776 Unrealized gains on available-for-sale securities: Unrealized gains for the period, net — — — 71,370 (28,548 ) 42,822 Pension and other postretirement plans: Amortization of net prior service cost included in net income 215 (58 ) 157 358 (143 ) 215 Amortization of net actuarial gain included in net income (7,956 ) 2,148 (5,808 ) (4,958 ) 1,983 (2,975 ) (7,741 ) 2,090 (5,651 ) (4,600 ) 1,840 (2,760 ) Cash flow hedge: Gain (loss) for the period 601 (114 ) 487 (215 ) 43 (172 ) Other Comprehensive (Loss) Income $ (29,587 ) $ 1,976 $ (27,611 ) $ 101,331 $ (26,665 ) $ 74,666 |
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 (Loss) Balance as of December 31, 2017 $ 6,314 $ 194,889 $ 334,536 $ (184 ) $ 535,555 Reclassification of unrealized gains on available-for-sale-securities to retained earnings as a result of adoption of new guidance — (194,889 ) — — (194,889 ) Other comprehensive (loss) income before reclassifications (22,447 ) — — 569 (21,878 ) Net amount reclassified from accumulated other comprehensive income (loss) — — (5,651 ) (82 ) (5,733 ) Other comprehensive (loss) income, net of tax (22,447 ) — (5,651 ) 487 (27,611 ) Balance as of September 30, 2018 $ (16,133 ) $ — $ 328,885 $ 303 $ 313,055 |
Summary of Amounts and Line Items of Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | 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) 2018 2017 2018 2017 Pension and Other Postretirement Plans: Amortization of net prior service cost $ 69 $ 118 $ 215 $ 358 (1) Amortization of net actuarial gain (3,295 ) (1,567 ) (7,956 ) (4,958 ) (1) (3,226 ) (1,449 ) (7,741 ) (4,600 ) Before tax 873 580 2,090 1,840 Provision for Income Taxes (2,353 ) (869 ) (5,651 ) (2,760 ) Net of Tax Cash Flow Hedge (59 ) 51 (101 ) 123 Interest expense 11 (11 ) 19 (25 ) Provision for Income Taxes (48 ) 40 (82 ) 98 Net of Tax Total reclassification for the period $ (2,401 ) $ (829 ) $ (5,733 ) $ (2,662 ) Net of Tax ____________ (1) These accumulated other comprehensive income components are components of net periodic pension and postretirement plan cost (see Note 12) and are included in non-operating pension and postretirement benefit income in the Company’s Condensed Consolidated Statements of Operations. |
Business Segments (Tables)
Business Segments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting Information [Line Items] | |
Summary of Segment Reporting Information, by Operating Segment | The following table summarizes the financial information related to each of the Company’s business segments: Three Months Ended Nine months ended September 30 September 30 (in thousands) 2018 2017 2018 2017 Operating Revenues Education $ 358,601 $ 376,805 $ 1,104,105 $ 1,136,201 Television broadcasting 130,014 101,295 352,902 298,893 Healthcare 35,486 40,473 111,315 115,592 Other businesses 150,665 138,652 438,602 365,343 Corporate office — — — — Intersegment elimination — — (45 ) — $ 674,766 $ 657,225 $ 2,006,879 $ 1,916,029 Income (Loss) from Operations Education $ 22,262 $ 13,797 $ 82,516 $ 56,565 Television broadcasting 55,453 33,462 137,113 99,722 Healthcare (8,702 ) 920 (9,329 ) 378 Other businesses 4,613 (7,021 ) (136 ) (25,961 ) Corporate office (12,887 ) (14,208 ) (39,585 ) (43,760 ) $ 60,739 $ 26,950 $ 170,579 $ 86,944 Equity in Earnings (Losses) of Affiliates, Net 9,537 (532 ) 13,047 1,448 Interest Expense, Net (5,524 ) (7,758 ) (27,487 ) (22,386 ) Debt Extinguishment Costs — — (11,378 ) — Non-Operating Pension and Postretirement Benefit Income, Net 22,214 17,621 66,641 55,042 Loss on Marketable Equity Securities, Net 44,962 — 28,306 — Other Income, Net 3,142 1,963 14,662 6,881 Income Before Income Taxes $ 135,070 $ 38,244 $ 254,370 $ 127,929 Depreciation of Property, Plant and Equipment Education $ 6,685 $ 8,085 $ 21,130 $ 24,994 Television broadcasting 3,198 3,118 9,243 8,703 Healthcare 648 1,166 1,948 3,429 Other businesses 2,865 3,354 8,830 8,539 Corporate office 252 279 758 860 $ 13,648 $ 16,002 $ 41,909 $ 46,525 Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets Education $ 2,682 $ 1,355 $ 5,494 $ 3,798 Television broadcasting 1,408 1,071 4,224 2,943 Healthcare 9,839 2,420 13,456 5,718 Other businesses 6,449 6,389 18,987 25,367 Corporate office — — — — $ 20,378 $ 11,235 $ 42,161 $ 37,826 Pension Expense Education $ 2,107 $ 2,430 $ 6,649 $ 7,289 Television broadcasting 544 485 1,638 1,457 Healthcare 143 166 430 498 Other businesses 346 277 1,013 843 Corporate office 1,333 1,233 4,000 4,009 $ 4,473 $ 4,591 $ 13,730 $ 14,096 Asset information for the Company’s business segments are as follows: As of (in thousands) September 30, 2018 December 31, 2017 Identifiable Assets Education $ 1,599,680 $ 1,592,097 Television broadcasting 455,746 455,884 Healthcare 108,685 129,856 Other businesses 819,419 855,399 Corporate office 143,416 182,905 $ 3,126,946 $ 3,216,141 Marketable Equity Securities 497,879 536,315 Investments in Affiliates 142,756 128,590 Prepaid Pension Cost 1,106,162 1,056,777 Total Assets $ 4,873,743 $ 4,937,823 |
Education [Member] | |
Segment Reporting Information [Line Items] | |
Summary of Segment Reporting Information, by Operating Segment | Three Months Ended Nine months ended September 30 September 30 (in thousands) 2018 2017 2018 2017 Operating Revenues Kaplan international $ 167,668 $ 171,259 $ 535,553 $ 507,568 Higher education 89,269 105,210 275,080 328,161 Test preparation 67,749 72,680 195,504 212,978 Professional (U.S.) 34,302 28,249 98,715 88,812 Kaplan corporate and other 143 49 870 120 Intersegment elimination (530 ) (642 ) (1,617 ) (1,438 ) $ 358,601 $ 376,805 $ 1,104,105 $ 1,136,201 Income (Loss) from Operations Kaplan international $ 8,375 $ 5,348 $ 52,966 $ 29,009 Higher education 6,042 1,493 18,616 17,079 Test preparation 10,572 7,330 17,213 10,207 Professional (U.S.) 6,768 7,316 20,863 22,045 Kaplan corporate and other (9,452 ) (7,631 ) (27,110 ) (21,739 ) Intersegment elimination (43 ) (59 ) (32 ) (36 ) $ 22,262 $ 13,797 $ 82,516 $ 56,565 Depreciation of Property, Plant and Equipment Kaplan international $ 3,759 $ 3,780 $ 11,497 $ 11,071 Higher education 915 2,010 4,047 7,142 Test preparation 1,033 1,407 2,984 4,080 Professional (U.S.) 859 758 2,171 2,306 Kaplan corporate and other 119 130 431 395 $ 6,685 $ 8,085 $ 21,130 $ 24,994 Amortization of Intangible Assets $ 2,682 $ 1,355 $ 5,494 $ 3,798 Pension Expense Kaplan international $ 66 $ 24 $ 233 $ 198 Higher education 1,050 467 3,260 3,951 Test preparation 577 244 2,035 2,066 Professional (U.S.) 291 81 871 685 Kaplan corporate and other 123 1,614 250 389 $ 2,107 $ 2,430 $ 6,649 $ 7,289 Asset information for the Company’s education division is as follows: As of (in thousands) September 30, 2018 December 31, 2017 Identifiable assets Kaplan international $ 1,109,470 $ 1,115,919 Higher education 144,274 231,986 Test preparation 155,846 130,938 Professional (U.S.) 160,120 91,630 Kaplan corporate and other 29,970 21,624 $ 1,599,680 $ 1,592,097 |
Organization, Basis of Presen_4
Organization, Basis of Presentation and Recent Accounting Pronouncements (Organization and Basis of Presentation) (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2018TelevisionStationSegment | |
Percentage of ownership indicating control for consolidation purposes | more than 50% |
Television Broadcasting [Member] | |
Number of television broadcast stations | TelevisionStation | 7 |
Kaplan University Transaction [Member] | Education [Member] | Higher Education [Member] | |
Number of Operating Segments | Segment | 2 |
Organization, Basis of Presen_5
Organization, Basis of Presentation and Recent Accounting Pronouncements (Recent Accounting Pronouncements) (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Mar. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Retained earnings | $ 6,179,948 | $ 6,179,948 | $ 5,799,173 | $ 5,791,724 | |||
Revenues | 674,766 | $ 657,225 | 2,006,879 | $ 1,916,029 | |||
Income from Operations | 60,739 | 26,950 | 170,579 | 86,944 | |||
Costs and Expenses | 614,027 | $ 630,275 | 1,836,300 | $ 1,829,085 | |||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Retained earnings | $ 7,449 | ||||||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Retained earnings | $ 5,791,724 | ||||||
Revenues | 100 | (1,200) | |||||
Costs and Expenses | $ (1,800) | (2,600) | |||||
Retained Earnings [Member] | Accounting Standards Update 2016-01 [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 194,900 | ||||||
Higher Education [Member] | Kaplan University Transaction [Member] | Education [Member] | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | Accounting Standards Update 2014-09 [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenues | (4,500) | ||||||
Income from Operations | $ (4,500) |
Organization, Basis of Presen_6
Organization, Basis of Presentation and Recent Accounting Pronouncements (Recent Accounting Pronouncements) (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Item Effected [Line Items] | |||
Accounts receivable, net | $ 589,645 | $ 622,461 | $ 620,319 |
Inventories and contracts in progress | 73,696 | 61,515 | 60,612 |
Other current assets | 77,864 | 72,596 | 66,253 |
Accounts payable and accrued liabilities | 448,240 | 526,411 | 526,323 |
Deferred revenue | 335,086 | 339,108 | 339,454 |
Deferred income taxes | 364,898 | ||
Retained earnings | $ 6,179,948 | 5,799,173 | 5,791,724 |
Accounting Standards Update 2014-09 [Member] | Calculated under Revenue Guidance in Effect before Topic 606 [Member] | |||
Item Effected [Line Items] | |||
Accounts receivable, net | 620,319 | ||
Inventories and contracts in progress | 60,612 | ||
Other current assets | 66,253 | ||
Accounts payable and accrued liabilities | 526,323 | ||
Deferred revenue | 339,454 | ||
Deferred income taxes | 362,701 | ||
Retained earnings | $ 5,791,724 | ||
Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | |||
Item Effected [Line Items] | |||
Accounts receivable, net | 2,142 | ||
Inventories and contracts in progress | 903 | ||
Other current assets | 6,343 | ||
Accounts payable and accrued liabilities | 88 | ||
Deferred revenue | (346) | ||
Deferred income taxes | 2,197 | ||
Retained earnings | $ 7,449 |
Organization, Basis of Presen_7
Organization, Basis of Presentation and Recent Accounting Pronouncements (Recent Accounting Pronouncements) (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating expenses | $ 448,920 | $ 374,987 | $ 1,254,726 | $ 1,082,421 |
Selling, General and Administrative Expenses | 131,081 | 228,051 | 497,504 | 662,313 |
Income from Operations | 60,739 | 26,950 | 170,579 | 86,944 |
Non-operating pension and postretirement benefit income | (22,214) | (17,621) | (66,641) | (55,042) |
Income before income taxes | $ 135,070 | 38,244 | $ 254,370 | 127,929 |
Accounting Standards Update 2017-07 [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating expenses | 374,987 | 1,082,421 | ||
Selling, General and Administrative Expenses | 228,051 | 662,313 | ||
Income from Operations | 26,950 | 86,944 | ||
Non-operating pension and postretirement benefit income | 17,621 | 55,042 | ||
Income before income taxes | 38,244 | 127,929 | ||
Accounting Standards Update 2017-07 [Member] | Previously Reported [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating expenses | 352,635 | 1,011,553 | ||
Selling, General and Administrative Expenses | 232,782 | 678,139 | ||
Income from Operations | 44,571 | 141,986 | ||
Non-operating pension and postretirement benefit income | 0 | 0 | ||
Income before income taxes | 38,244 | 127,929 | ||
Accounting Standards Update 2017-07 [Member] | Restatement Adjustment [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating expenses | 22,352 | 70,868 | ||
Selling, General and Administrative Expenses | (4,731) | (15,826) | ||
Income from Operations | (17,621) | (55,042) | ||
Non-operating pension and postretirement benefit income | 17,621 | 55,042 | ||
Income before income taxes | $ 0 | $ 0 |
Acquisitions and Dispositions_3
Acquisitions and Dispositions of Businesses (Acquisitions) (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Apr. 30, 2017USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2018USD ($)business | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($)business | Aug. 31, 2018 | Jul. 31, 2018 | Jul. 12, 2018 | May 31, 2018 | Jun. 30, 2017 | Feb. 28, 2017 | |
Business Acquisition [Line Items] | |||||||||||
Number of businesses acquired | business | 8 | 6 | |||||||||
Acqusition purchase price | $ 120,900 | $ 318,900 | |||||||||
Pension and other post retirement benefits liabilities | (59,100) | ||||||||||
Purchase Price Net of Cash | 111,451 | $ 299,938 | |||||||||
Business Acquisition, Transaction Costs | $ 1,200 | 1,200 | $ 4,100 | ||||||||
Goodwill expected to be deductible for income tax purposes | 32,400 | 32,400 | $ 11,000 | ||||||||
Revenues of acquired companies since acquisition date | 10,200 | 12,600 | |||||||||
Operating loss of acquired companies since acquisition date | $ 0 | $ (800) | |||||||||
Education [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Number of businesses acquired | business | 5 | 2 | |||||||||
Education [Member] | Professional (U.S.) [Member] | College for Financial Planning [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 100.00% | ||||||||||
Education [Member] | Professional (U.S.) [Member] | Professional Publications, Inc. [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 100.00% | ||||||||||
Education [Member] | Kaplan International [Member] | Genesis [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 100.00% | ||||||||||
Education [Member] | Kaplan International [Member] | Red Marker [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 100.00% | ||||||||||
Television Broadcasting [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Number of businesses acquired | business | 2 | ||||||||||
Other Businesses [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Number of businesses acquired | business | 2 | 1 | |||||||||
Other Businesses [Member] | Hoover Treated Wood Products [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 97.72% | ||||||||||
Purchase Price Net of Cash | $ 206,800 | ||||||||||
Redeemable noncontrolling interest | $ 3,700 | ||||||||||
Other Businesses [Member] | Furnlite Inc [Member] | Dekko [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 100.00% | ||||||||||
Other Businesses [Member] | Marketplace Strategy [Member] | SocialCode [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 100.00% | ||||||||||
Graham Healthcare Group [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Number of businesses acquired | business | 1 | 1 | |||||||||
Graham Healthcare Group [Member] | Hometown Home Health and Hospice [Member] | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Percentage of interest acquired | 100.00% |
Acquisitions and Dispositions_4
Acquisitions and Dispositions of Businesses (Dispositions and Other) (Narrative) (Details) $ in Thousands | Mar. 22, 2018USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)business | Sep. 30, 2017USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Gain on the sale of businesses | $ 916 | $ 0 | $ 8,157 | $ (342) | |||
Impairment of long-lived assets | 8,100 | ||||||
Education [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Gain on the sale of businesses | $ 8,200 | ||||||
Number of businesses disposed | business | 3 | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
First Five Years of Transition and Operations Support Agreement | 5 years | ||||||
Transition and Operations Support Agreement Initial Term | 30 years | ||||||
Transition and Operations Support Agreement Renewal Periods | 5 years | ||||||
Transition and Operations Support Agreement Buy-Out Option Eligible Year | 6 years | ||||||
Number of Consecutive Years of Purdue University Global Cash Operating Losses | 3 years | ||||||
Gain on the sale of businesses | $ 4,300 | $ 4,300 | |||||
Gain Related to Contingent Consideration | $ 500 | $ 1,900 | |||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | Minimum [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Annual Purdue University Global Cash Operating Losses | $ 25,000 | ||||||
Aggregate Purdue University Global cash operating losses | $ 75,000 | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | Purdue University Global [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Percentage of Cost Efficiencies | 20.00% | ||||||
Advance Related To Kaplan University Transaction | $ 20,000 | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | Kaplan [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Percentage of Cost Efficiencies | 20.00% | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | March 22, 2018 through June 30, 2022 [Member] | Kaplan [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Kaplan Share of Purdue University Global Revenue | 12.50% | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | March 22, 2018 through June 30, 2023 [Member] | Purdue University Global [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Amount of Priority Payment Per Year Beyond Costs | $ 10,000 | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | July 1, 2022 through June 30, 2027 [Member] | Kaplan [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Kaplan Share of Purdue University Global Revenue | 13.00% | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | After June 30, 2023 [Member] | Purdue University Global [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Percentage of Revenue After Kaplan Efficiency Payment | 10.00% | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | After June 30, 2024 [Member] | Kaplan [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Kaplan University Transaction Termination Fee | 125.00% | ||||||
Purdue University Global Final Payment Note Duration | 10 years | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | After June 30, 2027 [Member] | Kaplan [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Kaplan Share of Purdue University Global Revenue | 12.50% | ||||||
Education [Member] | Higher Education [Member] | Kaplan University Transaction [Member] | After June 30, 2048 [Member] | Kaplan [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Kaplan University Transaction Termination Fee | 75.00% | ||||||
Purdue University Global Final Payment Note Duration | 10 years | ||||||
Graham Healthcare Group [Member] | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Change in redemption value of manditorily redeemable noncontrolling interest | $ 6,200 |
Acquisitions and Dispositions_5
Acquisitions and Dispositions of Businesses (Assets Acquired and Liabilities Assumed) (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | ||
Goodwill | $ 1,310,075 | $ 1,299,710 |
Pension and other post retirement benefits liabilities | (59,100) | |
Series of Individually Immaterial Business Acquisitions [Member] | ||
Business Acquisition [Line Items] | ||
Accounts receivable | 2,334 | 12,502 |
Inventory | 1,268 | 25,253 |
Property, plant and equipment | 1,518 | 29,921 |
Goodwill | 41,397 | 143,149 |
Indefinite-lived intangible assets | 14,200 | 33,800 |
Amortized intangible assets | 64,327 | 170,658 |
Other assets | 4,912 | 1,880 |
Pension and other post retirement benefits liabilities | 0 | (59,116) |
Other liabilities | (7,575) | (12,177) |
Deferred income tax liability | (4,460) | (37,289) |
Redeemable noncontrolling interest | 0 | (3,666) |
Aggregate purchase price, net of cash acquired | $ 117,921 | $ 304,915 |
Acquisitions and Dispositions_6
Acquisitions and Dispositions of Businesses (Pro Forma Financials) (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Acquisitions And Dispositions [Abstract] | ||||
Pro Forma Operating Revenues | $ 680,279 | $ 674,991 | $ 2,046,792 | $ 2,033,078 |
Pro Forma Net Income | $ 126,104 | $ 25,896 | $ 219,092 | $ 98,564 |
Acquisitions and Dispositions_7
Acquisitions and Dispositions of Businesses (Significant Component) (Details 3) - Kaplan University Transaction [Member] - Education [Member] - Higher Education [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Disposal Group, Not Discontinued Operation, Revenue | $ 0 | $ 105,036 | $ 91,526 | $ 327,529 |
Disposal Group, Not Discontinued Operation, Operating Income | $ 0 | $ 1,785 | $ 213 | $ 18,582 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2018USD ($) | Jun. 30, 2018GBP (£) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018GBP (£) | Dec. 31, 2017USD ($) | Dec. 31, 2017GBP (£) | |
Schedule of Investments [Line Items] | ||||||||
Money Market Investments | $ 86,000,000 | $ 86,000,000 | $ 217,600,000 | |||||
Payments to Acquire Marketable Securities | $ 0 | $ 0 | ||||||
Document Fiscal Year Focus | 2,018 | |||||||
Cumulative Realized Gain (Loss) on Marketable securities | $ 37,300,000 | |||||||
Proceeds from sales of marketable equity securities | 66,700,000 | 0 | ||||||
Equity in earnings (losses) of affiliates, net | 9,537,000 | $ (532,000) | 13,047,000 | 1,448,000 | ||||
Equity Securities without Readily Determinable Fair Value | 27,400,000 | 27,400,000 | $ 19,900,000 | |||||
Gain on cost method investments | 8,487,000 | 0 | 8,487,000 | 0 | ||||
Impairment loss on cost method investments | 2,500,000 | 2,500,000 | ||||||
Graham Healthcare Group [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Revenue from Related Parties | $ 2,500,000 | $ 4,500,000 | $ 9,500,000 | $ 14,100,000 | ||||
Intersection Holdings [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 11.00% | 11.00% | 11.00% | |||||
Residential Home Health Illinois [Member] | Graham Healthcare Group [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | 40.00% | |||||
Residential Hospice Illinois [Member] | Graham Healthcare Group [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 42.50% | 42.50% | 42.50% | |||||
Residential Healthcare Michigan hospital joint venture [Member] | Graham Healthcare Group [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | 40.00% | |||||
Celtic Healthcare Allegheny Health Network Joint Venture [Member] | Graham Healthcare Group [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 40.00% | 40.00% | 40.00% | |||||
York Joint Venture [Member] | KIHL [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 45.00% | 45.00% | 45.00% | |||||
Loan commitment to affiliate | £ | £ 25,000,000 | |||||||
Advances to Affiliate | £ | £ 22,000,000 | £ 16,000,000 | ||||||
Payments to Fund Long-term Loans to Related Parties | £ | £ 6,000,000 | |||||||
Loan Receivable, Payment Terms | 25 years | |||||||
Loan Receivable Fixed Interest Rate | 7.00% | |||||||
Earnings of two investments [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity in earnings (losses) of affiliates, net | $ 7,900,000 |
Investments (Investments in Mar
Investments (Investments in Marketable Equity Securities) (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Investments [Abstract] | ||
Total Cost | $ 239,904 | |
Total cost | $ 269,343 | |
Gross unrealized gains | 257,975 | |
Gross unrealized gains | 266,972 | |
Total Fair Value | $ 497,879 | |
Total Fair Value | $ 536,315 |
Investments (Gain (Loss) on Mar
Investments (Gain (Loss) on Marketable Equity Securities) (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Investments [Abstract] | ||||
Gain on marketable equity securities, net | $ 44,962 | $ 0 | $ 28,306 | $ 0 |
Plus: Net losses in earnings from marketable equity securities sold | 0 | 4,271 | ||
Net unrealized gains in earnings from marketable equity securities still held at the end of the period | $ 44,962 | $ 32,577 |
Accounts Receivable (Narrative)
Accounts Receivable (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Accounts and Notes Receivable, Net [Abstract] | ||||
Bad debt expense | $ 1.8 | $ 6.5 | $ 7.9 | $ 18.7 |
Accounts Receivable (Details 1)
Accounts Receivable (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Accounts and Notes Receivable, Net [Abstract] | |||
Receivable from contracts with customers, less doubtful accounts | $ 544,487 | $ 600,215 | |
Other Receivables | 45,158 | 20,104 | |
Accounts receivable, net | 589,645 | $ 622,461 | 620,319 |
Allowance for doubtful accounts | $ 14,453 | $ 22,975 |
Inventories and Contracts in _3
Inventories and Contracts in Progress (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Inventory, Net of Allowances, Customer Advances and Progress Billings [Abstract] | |||
Raw materials | $ 37,300 | $ 30,429 | |
Work-in-process | 10,926 | 10,258 | |
Finished goods | 18,506 | 18,851 | |
Contracts in progress | 6,964 | 1,074 | |
Inventories and contracts in progress | $ 73,696 | $ 61,515 | $ 60,612 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Goodwill) (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2018Segment | |
Goodwill [Line Items] | |
Number of reportable segments | 6 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets (Other Intangible Assets) (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Amortized Intangible Assets [Line Items] | |||||
Goodwill and other long-lived asset impairment charge | $ 8,109 | $ 312 | $ 9,200 | $ 8,109 | $ 9,536 |
Amortization of Intangible Assets | |||||
Amortization of intangible assets | 12,269 | $ 10,923 | 34,052 | $ 28,290 | |
Estimated amortization of intangible assets, remainder of 2018 | 12,000 | 12,000 | |||
Estimated amortization of intangible assets, 2019 | 48,000 | 48,000 | |||
Estimated amortization of intangible assets, 2020 | 45,000 | 45,000 | |||
Estimated amortization of intangible assets, 2021 | 39,000 | 39,000 | |||
Estimated amortization of intangible assets, 2022 | 33,000 | 33,000 | |||
Estimated amortization of intangible assets, after 2022 | 83,000 | $ 83,000 | |||
Other Businesses [Member] | Forney [Member] | |||||
Amortized Intangible Assets [Line Items] | |||||
Goodwill and other long-lived asset impairment charge | $ 9,200 | ||||
Healthcare [Member] | |||||
Amortized Intangible Assets [Line Items] | |||||
Intangible asset impairment charge | $ 7,900 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets (Changes in Carrying Amount of Goodwill) (Details 1) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 1,665,861 |
Accumulated impairment losses, beginning balance | (366,151) |
Goodwill, net, beginning balance | 1,299,710 |
Acquisitions | 41,397 |
Dispositions | (11,191) |
Foreign currency exchange rate changes | (19,841) |
Goodwill, ending balance | 1,656,527 |
Accumulated impairment losses, ending balance | (346,452) |
Goodwill, net, ending balance | 1,310,075 |
Education [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 1,171,812 |
Accumulated impairment losses, beginning balance | (350,850) |
Goodwill, net, beginning balance | 820,962 |
Acquisitions | 19,981 |
Dispositions | (11,191) |
Foreign currency exchange rate changes | (19,841) |
Goodwill, ending balance | 1,141,062 |
Accumulated impairment losses, ending balance | (331,151) |
Goodwill, net, ending balance | 809,911 |
Education [Member] | Kaplan International [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 615,861 |
Accumulated impairment losses, beginning balance | 0 |
Goodwill, net, beginning balance | 615,861 |
Acquisitions | 26 |
Dispositions | 0 |
Foreign currency exchange rate changes | (19,775) |
Goodwill, ending balance | 596,112 |
Accumulated impairment losses, ending balance | 0 |
Goodwill, net, ending balance | 596,112 |
Education [Member] | Higher Education [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 205,494 |
Accumulated impairment losses, beginning balance | (131,023) |
Goodwill, net, beginning balance | 74,471 |
Acquisitions | 0 |
Dispositions | (11,191) |
Foreign currency exchange rate changes | (40) |
Goodwill, ending balance | 174,564 |
Accumulated impairment losses, ending balance | (111,324) |
Goodwill, net, ending balance | 63,240 |
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 |
Acquisitions | 626 |
Dispositions | 0 |
Foreign currency exchange rate changes | 0 |
Goodwill, ending balance | 166,724 |
Accumulated impairment losses, ending balance | (102,259) |
Goodwill, net, ending balance | 64,465 |
Education [Member] | Professional (U.S.) [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 184,359 |
Accumulated impairment losses, beginning balance | (117,568) |
Goodwill, net, beginning balance | 66,791 |
Acquisitions | 19,329 |
Dispositions | 0 |
Foreign currency exchange rate changes | (26) |
Goodwill, ending balance | 203,662 |
Accumulated impairment losses, ending balance | (117,568) |
Goodwill, net, ending balance | 86,094 |
Television Broadcasting [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 190,815 |
Accumulated impairment losses, beginning balance | 0 |
Goodwill, net, beginning balance | 190,815 |
Acquisitions | 0 |
Dispositions | 0 |
Foreign currency exchange rate changes | 0 |
Goodwill, ending balance | 190,815 |
Accumulated impairment losses, ending balance | 0 |
Goodwill, net, ending balance | 190,815 |
Healthcare [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 69,409 |
Accumulated impairment losses, beginning balance | 0 |
Goodwill, net, beginning balance | 69,409 |
Acquisitions | 217 |
Dispositions | 0 |
Foreign currency exchange rate changes | 0 |
Goodwill, ending balance | 69,626 |
Accumulated impairment losses, ending balance | 0 |
Goodwill, net, ending balance | 69,626 |
Other Businesses [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 233,825 |
Accumulated impairment losses, beginning balance | (15,301) |
Goodwill, net, beginning balance | 218,524 |
Acquisitions | 21,199 |
Dispositions | 0 |
Foreign currency exchange rate changes | 0 |
Goodwill, ending balance | 255,024 |
Accumulated impairment losses, ending balance | (15,301) |
Goodwill, net, ending balance | $ 239,723 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets (Other Intangible Assets) (Details 2) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | ||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 425,320 | $ 362,073 | |
Accumulated Amortization | 165,265 | 124,097 | |
Net Carrying Amount | 260,055 | 237,976 | |
Indefinite-Lived Intangible Assets [Line Items] | |||
Indefinite-Lived Intangible Assets | 114,752 | 102,195 | |
Trade Names and Trademarks [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Indefinite-Lived Intangible Assets | 95,802 | 82,745 | |
FCC licenses [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Indefinite-Lived Intangible Assets | 18,800 | 18,800 | |
Licensure and Accreditation [Member] | |||
Indefinite-Lived Intangible Assets [Line Items] | |||
Indefinite-Lived Intangible Assets | 150 | 650 | |
Student and Customer Relationships [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | 281,639 | 260,464 | |
Accumulated Amortization | 106,235 | 83,690 | |
Net Carrying Amount | $ 175,404 | $ 176,774 | |
Student and Customer Relationships [Member] | Minimum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | [1] | 2 years | 1 year |
Student and Customer Relationships [Member] | Maximum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | [1] | 10 years | 10 years |
Trade Names and Trademarks [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 71,870 | $ 50,286 | |
Accumulated Amortization | 37,858 | 25,596 | |
Net Carrying Amount | $ 34,012 | $ 24,690 | |
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 | |
Network Affiliation Agreements [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 10 years | 10 years | |
Gross Carrying Amount | $ 17,400 | $ 17,400 | |
Accumulated Amortization | 2,972 | 1,668 | |
Net Carrying Amount | 14,428 | 15,732 | |
Databases and Technology [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | 28,788 | 19,563 | |
Accumulated Amortization | 8,537 | 5,008 | |
Net Carrying Amount | $ 20,251 | $ 14,555 | |
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 | 6 years | 6 years | |
Non-compete Agreements [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 1,093 | $ 930 | |
Accumulated Amortization | 778 | 467 | |
Net Carrying Amount | $ 315 | $ 463 | |
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 | $ 24,530 | $ 13,430 | |
Accumulated Amortization | 8,885 | 7,668 | |
Net Carrying Amount | $ 15,645 | $ 5,762 | |
Other [Member] | Minimum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 1 year | 1 year | |
Other [Member] | Maximum [Member] | |||
Amortized Intangible Assets [Line Items] | |||
Useful Life | 8 years | 8 years | |
[1] | As of December 31, 2017, the student and customer relationships’ minimum useful life was 1 year. |
Debt (Narrative) (Details)
Debt (Narrative) (Details) | Jun. 29, 2018USD ($) | May 30, 2018USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | |
Debt Instrument [Line Items] | |||||||||
Debt extinguishment costs | $ 0 | $ 0 | $ (11,378,000) | $ 0 | |||||
Average borrowings outstanding | $ 480,600,000 | $ 492,400,000 | $ 529,200,000 | $ 493,500,000 | |||||
Weighted average interest rate of borrowings | 5.10% | 6.30% | 5.70% | 6.30% | |||||
Net interest expense incurred | $ 5,500,000 | $ 7,800,000 | $ 27,500,000 | $ 22,400,000 | |||||
Interest expense | 6,135,000 | $ 8,619,000 | 31,371,000 | $ 25,783,000 | |||||
Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Issuance Costs, Net | 300,000 | $ 400,000 | 300,000 | ||||||
Borrowings outstanding | [1] | $ 85,024,000 | $ 93,671,000 | $ 85,024,000 | |||||
Other Indebtedness [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate | 2.00% | 2.00% | 2.00% | ||||||
Maturity year | Dec. 31, 2026 | Dec. 31, 2026 | |||||||
5.75% Unsecured Notes due June 1, 2026 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Issuance Costs, Net | $ 5,500,000 | $ 5,500,000 | |||||||
Interest rate | 5.75% | ||||||||
Debt Instrument, Face Amount | $ 400,000,000 | ||||||||
Fair value of debt instrument | 409,400,000 | 409,400,000 | |||||||
Carrying value of debt instrument | [2] | 394,504,000 | $ 0 | 394,504,000 | |||||
7.25% Unsecured Notes due February 1, 2019 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate | 7.25% | 7.25% | |||||||
Redemption of Notes Outstanding | $ 400,000,000 | ||||||||
Debt extinguishment costs | $ 11,400,000 | ||||||||
Fair value of debt instrument | $ 414,700,000 | ||||||||
Carrying value of debt instrument | $ 0 | $ 399,507,000 | $ 0 | ||||||
Five-Year Credit Agreement dated May 30, 2018 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Credit facility current borrowing capacity | $ 300,000,000 | ||||||||
Debt covenant net leverage ratio, maximum | 3.5 | ||||||||
Debt covenant interest coverage ratio, minimum | 3.5 | ||||||||
Term of debt instrument | 5 years | ||||||||
Five-Year Credit Agreement dated May 30, 2018 [Member] | Minimum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.15% | ||||||||
Five-Year Credit Agreement dated May 30, 2018 [Member] | Maximum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.25% | ||||||||
Five-Year Credit Agreement dated May 30, 2018 [Member] | Federal Funds Effective Swap Rate [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable interest rate margin | 0.50% | ||||||||
Five-Year Credit Agreement dated May 30, 2018 [Member] | Eurodollar [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Applicable interest rate margin | 1.00% | ||||||||
USD $200 million portion of revolver [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Credit facility current borrowing capacity | $ 200,000,000 | ||||||||
Multicurrency $100 million portion of revolver [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Credit facility current borrowing capacity | $ 100,000,000 | ||||||||
Graham Healthcare Group [Member] | Securities Subject to Mandatory Redemption [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest expense | $ 6,200,000 | ||||||||
[1] | The carrying value is net of $0.3 million and $0.4 million of unamortized debt issuance costs as of September 30, 2018 and December 31, 2017, respectively. | ||||||||
[2] | The carrying value is net of $5.5 million of unamortized debt issuance costs as of September 30, 2018. |
Debt (Details 1)
Debt (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | |||
Other indebtedness | $ 100 | $ 109 | |
Total Debt | 479,628 | 493,287 | |
Less: current portion | (6,568) | (6,726) | |
Total Long-Term Debt | 473,060 | 486,561 | |
5.75% Unsecured Notes due June 1, 2026 [Member] | |||
Debt Instrument [Line Items] | |||
Unsecured notes | [1] | 394,504 | 0 |
Unamortized debt issuance costs | 5,500 | ||
7.25% Unsecured Notes due February 1, 2019 [Member] | |||
Debt Instrument [Line Items] | |||
Unsecured notes | 0 | 399,507 | |
Kaplan Four-Year Credit Agreement dated July 14, 2016 [Member] | |||
Debt Instrument [Line Items] | |||
UK Credit Facility | [2] | 85,024 | 93,671 |
Unamortized debt issuance costs | $ 300 | $ 400 | |
[1] | The carrying value is net of $5.5 million of unamortized debt issuance costs as of September 30, 2018. | ||
[2] | The carrying value is net of $0.3 million and $0.4 million of unamortized debt issuance costs as of September 30, 2018 and December 31, 2017, respectively. |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Gain on cost method investments | $ 8,487 | $ 0 | $ 8,487 | $ 0 | |
Impairment of long-lived assets | 8,100 | ||||
Impairment of goodwill and other long-lived assets | $ 8,109 | 312 | $ 9,200 | $ 8,109 | 9,536 |
Loss on write-downs of cost method investments | $ 200 | $ 200 |
Fair Value Measurements (Detail
Fair Value Measurements (Details 1) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 | |
Assets | |||
Money Market Investments | $ 86,000 | $ 217,600 | |
Marketable equity securities | 497,879 | ||
Marketable equity securities | 536,315 | ||
Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Money Market Investments | [1] | 85,999 | 217,628 |
Marketable equity securities | [2] | 497,879 | |
Marketable equity securities | [2] | 536,315 | |
Other current investments | [3] | 20,048 | 20,838 |
Interest Rate Swap | [4] | 418 | |
Total Financial Assets | 604,344 | 774,781 | |
Liabilities | |||
Deferred compensation plan liabilities | [5] | 38,154 | 43,414 |
Interest rate swap | [6] | 244 | |
Mandatorily redeemable noncontrolling interest | [7] | 10,331 | |
Total Financial Liabilities | 53,989 | ||
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | |||
Assets | |||
Money Market Investments | [1] | 0 | 0 |
Marketable equity securities | [2] | 497,879 | |
Marketable equity securities | [2] | 536,315 | |
Other current investments | [3] | 13,069 | 9,831 |
Interest Rate Swap | [4] | 0 | |
Total Financial Assets | 510,948 | 546,146 | |
Liabilities | |||
Deferred compensation plan liabilities | [5] | 0 | 0 |
Interest rate swap | [6] | 0 | |
Mandatorily redeemable noncontrolling interest | [7] | 0 | |
Total Financial Liabilities | 0 | ||
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | |||
Assets | |||
Money Market Investments | [1] | 85,999 | 217,628 |
Marketable equity securities | [2] | 0 | |
Marketable equity securities | [2] | 0 | |
Other current investments | [3] | 6,979 | 11,007 |
Interest Rate Swap | [4] | 418 | |
Total Financial Assets | 93,396 | 228,635 | |
Liabilities | |||
Deferred compensation plan liabilities | [5] | $ 38,154 | 43,414 |
Interest rate swap | [6] | 244 | |
Mandatorily redeemable noncontrolling interest | [7] | 0 | |
Total Financial Liabilities | 43,658 | ||
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | |||
Assets | |||
Money Market Investments | [1] | 0 | |
Marketable equity securities | [2] | 0 | |
Other current investments | [3] | 0 | |
Total Financial Assets | 0 | ||
Liabilities | |||
Deferred compensation plan liabilities | [5] | 0 | |
Interest rate swap | [6] | 0 | |
Mandatorily redeemable noncontrolling interest | [7] | 10,331 | |
Total Financial Liabilities | $ 10,331 | ||
[1] | The Company’s money market investments are included in Cash and Cash Equivalents and Restricted Cash and the value considers the liquidity of the counterparty. | ||
[2] | The Company’s investments in marketable equity securities are held in common shares of U.S. corporations that are actively traded on U.S. stock exchanges. Price quotes for these shares are readily available. Investments in marketable securities were classified as available-for-sale in 2017 prior to the adoption of the new accounting guidance (see Note 1). | ||
[3] | 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 fair value hierarchy. | ||
[4] | Included in Deferred Charges and Other Assets. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. | ||
[5] | 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. | ||
[6] | Included in Other Liabilities. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates. | ||
[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) $ in Millions | 3 Months Ended |
Sep. 30, 2018USD ($) | |
State and Local Jurisdiction [Member] | Education [Member] | |
Income Taxes [Line Items] | |
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | $ (17.8) |
Revenue (Narrative) (Details)
Revenue (Narrative) (Details) $ in Thousands | Mar. 22, 2018 | Sep. 30, 2018USD ($)business | Mar. 31, 2018 | Mar. 22, 2018 | Sep. 30, 2018USD ($)business |
Disaggregation of Revenue [Line Items] | |||||
Maximum Term of Contract | 1 year | ||||
Deferred revenue recognized in period related to beginning balance | $ 239,600 | ||||
Costs amortized during the period | $ 10,900 | $ (33,642) | |||
Kaplan International [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Number of Performance Obligations | 1 | ||||
Number of Business Lines | business | 1 | 1 | |||
Higher Education [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Number of Performance Obligations | 1 | 1 | |||
Number of Performance Obligations In Contract With Tuition Cap | 2 | ||||
Transition and Operations Support Agreement Initial Term | 30 years | ||||
Test Preparation [Member] | Long-term Contract with Customer [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue, Remaining Performance Obligation, Amount | $ 6,200 | $ 6,200 | |||
Revenue Remaining Performance Obligation Percentage of Revenue Expected to be Recognized Over Next 12 Months | 82.00% | 82.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | 12 months | |||
Minimum Term of Contract | 12 months | ||||
Television Broadcasting [Member] | Advertising Revenue [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Number of Performance Obligations | 1 | ||||
Revenue Recognition, Maximum Period between Recognition of Revenue and Receipt of Payment | 60 days | ||||
Television Broadcasting [Member] | Retransmission Revenue [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Number of Performance Obligations | 1 | ||||
Revenue Recognition, Maximum Period between Recognition of Revenue and Receipt of Payment | 60 days | ||||
Manufacturing [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue Recognition, Maximum Period between Recognition of Revenue and Receipt of Payment | 90 days | ||||
Number of Business Lines | business | 4 | 4 | |||
Healthcare [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Number of Performance Obligations | 1 | ||||
Revenue Recognition, Maximum Period between Recognition of Revenue and Receipt of Payment | 60 days | ||||
Healthcare [Member] | Other Healthcare Services [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Number of Performance Obligations | 1 | ||||
SocialCode [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Number of Performance Obligations | 1 | ||||
Revenue Recognition, Maximum Period between Recognition of Revenue and Receipt of Payment | 45 days | ||||
Transferred over Time [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of Revenue | 80.00% | 80.00% | |||
Transferred over Time [Member] | Manufacturing [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of Revenue | 25.00% | 27.00% | |||
Transferred at Point in Time [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of Revenue | 20.00% | 20.00% | |||
U.S. [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of Revenue | 78.00% | 76.00% | |||
Non-US [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Percentage of Revenue | 22.00% | 24.00% |
Disaggregation of Revenue (Deta
Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 674,766 | $ 657,225 | $ 2,006,879 | $ 1,916,029 |
Kaplan International [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 167,668 | 171,259 | 535,553 | 507,568 |
Higher Education [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 89,269 | 105,210 | 275,080 | 328,161 |
Test Preparation [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 67,749 | 72,680 | 195,504 | 212,978 |
Professional (U.S.) [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 34,302 | 28,249 | 98,715 | 88,812 |
Kaplan Corporate and Other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 143 | 49 | 870 | 120 |
Education Intersegment Eliminations [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | (530) | (642) | (1,617) | (1,438) |
Education [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 358,601 | 376,805 | 1,104,105 | 1,136,201 |
Television Broadcasting [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 130,014 | 101,295 | 352,902 | 298,893 |
Manufacturing [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 126,028 | 115,594 | 369,896 | 298,164 |
Healthcare [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 35,486 | 40,473 | 111,315 | 115,592 |
SocialCode [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 13,781 | 14,497 | 41,850 | 41,926 |
Other Businesses [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 10,856 | 8,561 | 26,856 | 25,253 |
Business Intersegment Eliminations [Domain] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 0 | $ 0 | $ (45) | $ 0 |
Contract with Customer Liabilit
Contract with Customer Liability (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Jan. 01, 2018 | |
Contract with Customer, Liability [Abstract] | ||
Deferred Revenue | $ 337,964 | $ 342,640 |
Deferred Revenue, Period Decrease Percentage | (1.00%) |
Capitalized Contract Cost (Deta
Capitalized Contract Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Jan. 01, 2018 | |
Capitalized Contract Cost [Line Items] | |||
Contract costs capitalized during the period | $ 32,827 | ||
Costs amortized during the period | $ 10,900 | (33,642) | |
Change in capitalized contract cost, other | (540) | ||
Balance of costs to obtain a contract | $ 14,688 | $ 14,688 | $ 16,043 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Dividends declared per common share | $ 1.33 | $ 1.27 | $ 5.32 | $ 5.08 |
Stock Option Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Antidilutive securities, shares | 104,000 | 104,000 | 104,000 | 104,000 |
Restricted Stock Awards [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Antidilutive securities, shares | 5,250 | 5,250 | 5,250 | 5,250 |
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, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Schedule of Earnings Per Share, Basic and Diluted, Including Two Class Method [Line Items] | ||||
Net income attributable to Graham Holdings Company common stockholders | $ 125,064 | $ 24,784 | $ 214,521 | $ 87,866 |
Less: Dividends paid-common stock outstanding and unvested restricted shares | (7,048) | (7,047) | (28,635) | (28,329) |
Undistributed earnings | $ 118,016 | $ 17,737 | $ 185,886 | $ 59,537 |
Percent allocated to common stockholders | 99.34% | 99.07% | 99.34% | 99.07% |
Undistributed Earnings Allocated To Common Stockholders | $ 117,235 | $ 17,572 | $ 184,657 | $ 58,981 |
Add: Dividends paid-common stock outstanding | 7,001 | 6,981 | 28,447 | 28,066 |
Numerator for basic earnings per share | 124,236 | 24,553 | 213,104 | 87,047 |
Add: Additional undistributed earnings due to dilutive stock options | 5 | 1 | 8 | 4 |
Numerator for diluted earnings per share | $ 124,241 | $ 24,554 | $ 213,112 | $ 87,051 |
Weighted average shares outstanding (shares) | 5,302 | 5,518 | 5,354 | 5,530 |
Denominator for diluted earnings per share (shares) | 5,337 | 5,554 | 5,390 | 5,567 |
Graham Holdings Company Common Stockholders: | ||||
Basic income per common share in dollars per share | $ 23.43 | $ 4.45 | $ 39.81 | $ 15.74 |
Diluted income per common share in dollars per share | $ 23.28 | $ 4.42 | $ 39.54 | $ 15.64 |
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) | 35 | 36 | 36 | 37 |
Earnings Per Share (Details 2)
Earnings Per Share (Details 2) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Weighted average restricted stock | 21 | 30 | 23 | 29 |
Pension and Postretirement Pl_3
Pension and Postretirement Plans (Narrative) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018USD ($)Investmentcompanies | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)Investmentcompanies | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($)Investment | |
Defined Benefit Plan Disclosure [Line Items] | |||||
Special separation benefit expense | $ 0 | $ 932 | |||
Defined Benefit Pension Plan [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Special separation benefit expense | $ 0 | $ 932 | $ 0 | $ 932 | |
Percent of plan assets managed internally by the company | 45.00% | ||||
Percent of plan assets managed by investment companies | 55.00% | ||||
Number of investment companies actively managing plan assets | companies | 2 | 2 | |||
Percentage of total plan assets | 100.00% | 100.00% | 100.00% | ||
Defined Benefit Pension Plan [Member] | Separation Incentive Program [Member] | Forney [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Special separation benefit expense | $ 900 | ||||
Berkshire Hathaway Common Stock [Member] | Defined Benefit Pension Plan [Member] | |||||
Defined Benefit Plan 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] | Maximum [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Defined benefit plan, target allocation percentage of assets | 23.00% | 23.00% | |||
Fixed income securities [Member] | Defined Benefit Pension Plan [Member] | Minimum [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Defined benefit plan, target allocation percentage of assets | 10.00% | 10.00% | |||
Single Equity Concentration [Member] | Defined Benefit Pension Plan [Member] | |||||
Defined Benefit Plan 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 | $ 1,154,400 | $ 1,154,400 | $ 1,079,300 | ||
Percentage of total plan assets | 46.00% | 46.00% | 46.00% | ||
Single Equity Concentration [Member] | Equity Securities [Member] | Defined Benefit Pension Plan [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Number of investments the company's pension plan held which individually exceed 10% of total plan assets | Investment | 1 | 1 | 1 | ||
Single Equity Concentration [Member] | Equity Funds [Member] | Defined Benefit Pension Plan [Member] | |||||
Defined Benefit Plan 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] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Minimum percentage of plan assets considered as significant concentrations in pension plans | 10.00% | 10.00% |
Pension and Postretirement Pl_4
Pension and Postretirement Plans (Total Benefit/Cost) (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Special separation benefit expense | $ 0 | $ 932 | ||
Net Periodic Cost (Benefit) | $ 4,473 | $ 4,591 | 13,730 | 14,096 |
Defined Benefit Pension Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 4,473 | 4,591 | 13,730 | 14,096 |
Interest cost | 11,844 | 11,980 | 34,943 | 35,945 |
Expected return on assets | (31,969) | (30,338) | (97,251) | (91,078) |
Amortization of prior service cost (credit) | 36 | 42 | 114 | 128 |
Recognized actuarial loss (gain) | (2,974) | (1,039) | (6,994) | (3,372) |
Net Periodic Benefit | (18,590) | (14,764) | (55,458) | (44,281) |
Curtailment gain | 0 | 0 | (806) | 0 |
Special separation benefit expense | 0 | 932 | 0 | 932 |
Net Periodic Cost (Benefit) | (18,590) | (13,832) | (56,264) | (43,349) |
Supplemental Executive Retirement Plan (SERP) [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 205 | 214 | 614 | 643 |
Interest cost | 967 | 1,059 | 2,899 | 3,175 |
Amortization of prior service cost (credit) | 77 | 114 | 233 | 342 |
Recognized actuarial loss (gain) | 600 | 444 | 1,802 | 1,331 |
Net Periodic Cost (Benefit) | 1,849 | 1,831 | 5,548 | 5,491 |
Other Postretirement Plans [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 267 | 257 | 803 | 771 |
Interest cost | 170 | 195 | 509 | 584 |
Amortization of prior service cost (credit) | (44) | (38) | (132) | (112) |
Recognized actuarial loss (gain) | (921) | (972) | (2,764) | (2,917) |
Net Periodic Cost (Benefit) | $ (528) | $ (558) | $ (1,584) | $ (1,674) |
Pension and Postretirement Pl_5
Pension and Postretirement Plans (Asset Allocation) (Details 2) - Defined Benefit Pension Plans [Member] | Sep. 30, 2018 | Dec. 31, 2017 |
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 100.00% | 100.00% |
U.S. [Member] | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 52.00% | 53.00% |
U.S. [Member] | Equity Funds [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 31.00% | 30.00% |
U.S. [Member] | Fixed income securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 11.00% | 11.00% |
International [Member] | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan Assets Allocation (Percent) | 6.00% | 6.00% |
Other Non-Operating Income (Nar
Other Non-Operating Income (Narrative) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)business | Sep. 30, 2017USD ($) | |
Schedule of Non-Operating Income (Expense) [Line Items] | |||||
Gain on cost method investments | $ 8,487 | $ 0 | $ 8,487 | $ 0 | |
Gain (loss) on sales of businesses | 916 | $ 0 | 8,157 | $ (342) | |
Education [Member] | |||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||
Gain (loss) on sales of businesses | $ 8,200 | ||||
Number of businesses disposed | business | 3 | ||||
Higher Education [Member] | Education [Member] | Kaplan University Transaction [Member] | |||||
Schedule of Non-Operating Income (Expense) [Line Items] | |||||
Gain (loss) on sales of businesses | $ 4,300 | $ 4,300 | |||
Gain Related to Contingent Consideration | $ 500 | $ 1,900 |
Other Non-Operating Income (Det
Other Non-Operating Income (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Other Nonoperating Income (Expense) [Abstract] | ||||
Gain on cost method investments | $ 8,487 | $ 0 | $ 8,487 | $ 0 |
Impairment of cost method investments | (2,500) | (2,500) | ||
Impairment of cost method investments | (200) | (200) | ||
Gain (loss) on sales of businesses | 916 | 0 | 8,157 | (342) |
Gain on sale of a cost method investment | 0 | 0 | 2,845 | 0 |
Gain on sale of land | 0 | 0 | 2,542 | 0 |
Foreign currency (loss) gain, net | (116) | 1,414 | (2,205) | 6,608 |
Other, net | (3,645) | 749 | (2,664) | 815 |
Total Other Non-Operating Income | $ 3,142 | $ 1,963 | $ 14,662 | $ 6,881 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Components of OCI) (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before tax | $ (6,076) | $ 57,785 | $ (29,587) | $ 101,331 | |
Other Comprehensive Income (Loss), income tax | 874 | (18,540) | 1,976 | (26,665) | |
Other Comprehensive Income (Loss), Net of Tax | (5,202) | 39,245 | (27,611) | 74,666 | |
Foreign Currency Translation Adjustment [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | (2,844) | 11,470 | (22,447) | 34,776 | |
Other Comprehensive Income (Loss) before Reclassifications, Tax | 0 | 0 | 0 | 0 | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (2,844) | 11,470 | (22,447) | 34,776 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | ||||
Other Comprehensive Income (Loss), Net of Tax | (22,447) | ||||
Unrealized Gains (Losses) on Available-for-Sale Securities [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, before Tax | 0 | 47,836 | 0 | 71,370 | |
Other Comprehensive Income (Loss) before Reclassifications, Tax | 0 | (19,134) | 0 | (28,548) | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 0 | 28,702 | 0 | 42,822 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | ||||
Other Comprehensive Income (Loss), Net of Tax | 0 | ||||
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 | (3,226) | (1,449) | (7,741) | (4,600) | |
Reclassification from AOCI, Current Period, Tax | 873 | 580 | 2,090 | 1,840 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (2,353) | (869) | (5,651) | (2,760) | |
Other Comprehensive Income (Loss), before tax | (3,226) | (1,449) | (7,741) | (4,600) | |
Other Comprehensive Income (Loss), income tax | 873 | 580 | 2,090 | 1,840 | |
Other Comprehensive Income (Loss), Net of Tax | (2,353) | (869) | (5,651) | (2,760) | |
Net Prior Service Cost [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | [1] | 69 | 118 | 215 | 358 |
Reclassification from AOCI, Current Period, Tax | (18) | (47) | (58) | (143) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 51 | 71 | 157 | 215 | |
Net Actuarial (Gain) Loss [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | [1] | (3,295) | (1,567) | (7,956) | (4,958) |
Reclassification from AOCI, Current Period, Tax | 891 | 627 | 2,148 | 1,983 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (2,404) | (940) | (5,808) | (2,975) | |
Cash Flow Hedge [Member] | |||||
Other Comprehensive Income (Loss) [Line Items] | |||||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 569 | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (82) | ||||
Other Comprehensive Income (Loss), before tax | (6) | (72) | 601 | (215) | |
Other Comprehensive Income (Loss), income tax | 1 | 14 | (114) | 43 | |
Other Comprehensive Income (Loss), Net of Tax | $ (5) | $ (58) | $ 487 | $ (172) | |
[1] | These accumulated other comprehensive income components are components of net periodic pension and postretirement plan cost (see Note 12) and are included in non-operating pension and postretirement benefit income in the Company’s Condensed Consolidated Statements of Operations. |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) (AOCI balances) (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), beginning balance | $ 2,915,145 | |||
Other Comprehensive (Loss) Income, Net of Tax | $ (5,202) | $ 39,245 | (27,611) | $ 74,666 |
Accumulated Other Comprehensive Income (Loss), ending balance | 2,975,357 | 2,975,357 | ||
AOCI Including Portion Attributable to Noncontrolling Interest [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), beginning balance | 535,555 | |||
Reclassification from accumulated other comprehensive income to retained earnings as a result of adoption of new guidance | (194,889) | |||
Other comprehensive (loss) income before reclassifications | (21,878) | |||
Net amount reclassified from accumulated other comprehensive income (loss) | (5,733) | |||
Other Comprehensive (Loss) Income, Net of Tax | (27,611) | |||
Accumulated Other Comprehensive Income (Loss), ending balance | 313,055 | 313,055 | ||
Cumulative Foreign Currency Translation Adjustment [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), beginning balance | 6,314 | |||
Reclassification from accumulated other comprehensive income to retained earnings as a result of adoption of new guidance | 0 | |||
Other comprehensive (loss) income before reclassifications | (2,844) | 11,470 | (22,447) | 34,776 |
Net amount reclassified from accumulated other comprehensive income (loss) | 0 | |||
Other Comprehensive (Loss) Income, Net of Tax | (22,447) | |||
Accumulated Other Comprehensive Income (Loss), ending balance | (16,133) | (16,133) | ||
Unrealized Gain on Available-for-Sale Securities [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), beginning balance | 194,889 | |||
Reclassification from accumulated other comprehensive income to retained earnings as a result of adoption of new guidance | (194,889) | |||
Other comprehensive (loss) income before reclassifications | 0 | 28,702 | 0 | 42,822 |
Net amount reclassified from accumulated other comprehensive income (loss) | 0 | |||
Other Comprehensive (Loss) Income, Net of Tax | 0 | |||
Accumulated Other Comprehensive Income (Loss), ending balance | 0 | 0 | ||
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 (Loss), beginning balance | 334,536 | |||
Reclassification from accumulated other comprehensive income to retained earnings as a result of adoption of new guidance | 0 | |||
Other comprehensive (loss) income before reclassifications | 0 | |||
Net amount reclassified from accumulated other comprehensive income (loss) | (2,353) | (869) | (5,651) | (2,760) |
Other Comprehensive (Loss) Income, Net of Tax | (2,353) | (869) | (5,651) | (2,760) |
Accumulated Other Comprehensive Income (Loss), ending balance | 328,885 | 328,885 | ||
Cash Flow Hedge [Member] | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Accumulated Other Comprehensive Income (Loss), beginning balance | (184) | |||
Reclassification from accumulated other comprehensive income to retained earnings as a result of adoption of new guidance | 0 | |||
Other comprehensive (loss) income before reclassifications | 569 | |||
Net amount reclassified from accumulated other comprehensive income (loss) | (82) | |||
Other Comprehensive (Loss) Income, Net of Tax | (5) | $ (58) | 487 | $ (172) |
Accumulated Other Comprehensive Income (Loss), ending balance | $ 303 | $ 303 |
Accumulated Other Comprehensi_5
Accumulated Other Comprehensive Income (Loss) (Reclassifications out of AOCI) (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | ||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | $ 6,135 | $ 8,619 | $ 31,371 | $ 25,783 | |
Provision for Income Taxes | 10,000 | 13,400 | 39,700 | 40,000 | |
Net of Tax | (125,070) | (24,844) | (214,670) | (87,929) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Net of Tax | (2,401) | (829) | (5,733) | (2,662) | |
Foreign Currency Translation Adjustment [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, net of tax | 0 | ||||
Unrealized Gain on Available-for-Sale Securities [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, net of tax | 0 | ||||
Pension and Other Postretirement Plans [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | (3,226) | (1,449) | (7,741) | (4,600) | |
Provision for Income Tax | 873 | 580 | 2,090 | 1,840 | |
Reclassifications, net of tax | (2,353) | (869) | (5,651) | (2,760) | |
Net Prior Service Cost [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | [1] | 69 | 118 | 215 | 358 |
Provision for Income Tax | (18) | (47) | (58) | (143) | |
Reclassifications, net of tax | 51 | 71 | 157 | 215 | |
Net Actuarial (Gain) Loss [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, before tax | [1] | (3,295) | (1,567) | (7,956) | (4,958) |
Provision for Income Tax | 891 | 627 | 2,148 | 1,983 | |
Reclassifications, net of tax | (2,404) | (940) | (5,808) | (2,975) | |
Cash Flow Hedge [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassifications, net of tax | (82) | ||||
Cash Flow Hedge [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | (59) | 51 | (101) | 123 | |
Provision for Income Taxes | 11 | (11) | 19 | (25) | |
Net of Tax | $ (48) | $ 40 | $ (82) | $ 98 | |
[1] | These accumulated other comprehensive income components are components of net periodic pension and postretirement plan cost (see Note 12) and are included in non-operating pension and postretirement benefit income in the Company’s Condensed Consolidated Statements of Operations. |
Contingencies (Details)
Contingencies (Details) $ in Thousands, £ in Millions | Sep. 30, 2018USD ($)claimprogram_review | Sep. 30, 2018GBP (£)claimprogram_review | Dec. 31, 2017USD ($) |
Loss Contingencies [Line Items] | |||
Number of existing legal claims or proceedings that are likely to have a material effect on the Company's business | claim | 0 | 0 | |
Deferred Charges and Other Assets | $ 117,149 | $ 102,046 | |
Maximum [Member] | |||
Loss Contingencies [Line Items] | |||
Loss contingency, estimate of possible loss | 45,000 | ||
Education [Member] | Sale of KHE Campuses business [Member] | |||
Loss Contingencies [Line Items] | |||
Secondarily Liable Leases | $ 16,300 | ||
Education [Member] | Sale of KHE Campuses business [Member] | Higher Education [Member] | |||
Loss Contingencies [Line Items] | |||
Number of pending program reviews | program_review | 2 | 2 | |
Her Majesty's Revenue and Customs (HMRC) [Member] | UK Pathways [Member] | Kaplan International [Member] | |||
Loss Contingencies [Line Items] | |||
Loss contingency, estimate of possible loss | £ | £ 15.4 | ||
Deferred Charges and Other Assets | £ | £ 15.4 |
Business Segments (Narrative) (
Business Segments (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2018Segment | |
Business Segments [Line Items] | |
Number of reportable segments | 6 |
Kaplan University Transaction [Member] | Higher Education [Member] | Education [Member] | |
Business Segments [Line Items] | |
Number of Operating Segments | 2 |
Business Segments (Information
Business Segments (Information by Operating Segment) (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | $ 674,766 | $ 657,225 | $ 2,006,879 | $ 1,916,029 | ||
Income (Loss) from Operations | 60,739 | 26,950 | 170,579 | 86,944 | ||
Equity in earnings (losses) of affiliates, net | 9,537 | (532) | 13,047 | 1,448 | ||
Interest Expense, Net | (5,524) | (7,758) | (27,487) | (22,386) | ||
Debt Extinguishment Costs | 0 | 0 | (11,378) | 0 | ||
Non-operating pension and postretirement benefit income, net | 22,214 | 17,621 | 66,641 | 55,042 | ||
Gain on marketable equity securities, net | 44,962 | 0 | 28,306 | 0 | ||
Other income, net | 3,142 | 1,963 | 14,662 | 6,881 | ||
Income Before Income Taxes | 135,070 | 38,244 | 254,370 | 127,929 | ||
Depreciation of property, plant and equipment | 13,648 | 16,002 | 41,909 | 46,525 | ||
Amortization of Intangible Assets | 12,269 | 10,923 | 34,052 | 28,290 | ||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | 20,378 | 11,235 | 42,161 | 37,826 | ||
Pension Expense | 4,473 | 4,591 | 13,730 | 14,096 | ||
Identifiable Assets | 3,126,946 | 3,126,946 | $ 3,216,141 | |||
Marketable equity securities | 497,879 | 497,879 | ||||
Marketable Equity Securities | 536,315 | |||||
Investments in Affiliates | 142,756 | 142,756 | 128,590 | |||
Prepaid Pension Cost | 1,106,162 | 1,106,162 | 1,056,777 | |||
Total Assets | 4,873,743 | 4,873,743 | 4,937,823 | |||
Goodwill and other long-lived asset impairment charge | 8,109 | 312 | $ 9,200 | 8,109 | 9,536 | |
Operating Segments [Member] | Education [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 358,601 | 376,805 | 1,104,105 | 1,136,201 | ||
Income (Loss) from Operations | 22,262 | 13,797 | 82,516 | 56,565 | ||
Depreciation of property, plant and equipment | 6,685 | 8,085 | 21,130 | 24,994 | ||
Amortization of Intangible Assets | 2,682 | 1,355 | 5,494 | 3,798 | ||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | 2,682 | 1,355 | 5,494 | 3,798 | ||
Pension Expense | 2,107 | 2,430 | 6,649 | 7,289 | ||
Identifiable Assets | 1,599,680 | 1,599,680 | 1,592,097 | |||
Operating Segments [Member] | Education [Member] | Kaplan Corporate and Other [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 143 | 49 | 870 | 120 | ||
Income (Loss) from Operations | (9,452) | (7,631) | (27,110) | (21,739) | ||
Depreciation of property, plant and equipment | 119 | 130 | 431 | 395 | ||
Pension Expense | 123 | 1,614 | 250 | 389 | ||
Identifiable Assets | 29,970 | 29,970 | 21,624 | |||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Kaplan International [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 167,668 | 171,259 | 535,553 | 507,568 | ||
Income (Loss) from Operations | 8,375 | 5,348 | 52,966 | 29,009 | ||
Depreciation of property, plant and equipment | 3,759 | 3,780 | 11,497 | 11,071 | ||
Pension Expense | 66 | 24 | 233 | 198 | ||
Identifiable Assets | 1,109,470 | 1,109,470 | 1,115,919 | |||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Higher Education [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 89,269 | 105,210 | 275,080 | 328,161 | ||
Income (Loss) from Operations | 6,042 | 1,493 | 18,616 | 17,079 | ||
Depreciation of property, plant and equipment | 915 | 2,010 | 4,047 | 7,142 | ||
Pension Expense | 1,050 | 467 | 3,260 | 3,951 | ||
Identifiable Assets | 144,274 | 144,274 | 231,986 | |||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Test Preparation [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 67,749 | 72,680 | 195,504 | 212,978 | ||
Income (Loss) from Operations | 10,572 | 7,330 | 17,213 | 10,207 | ||
Depreciation of property, plant and equipment | 1,033 | 1,407 | 2,984 | 4,080 | ||
Pension Expense | 577 | 244 | 2,035 | 2,066 | ||
Identifiable Assets | 155,846 | 155,846 | 130,938 | |||
Operating Segments [Member] | Education [Member] | Reportable Subsegments [Member] | Professional (U.S.) [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 34,302 | 28,249 | 98,715 | 88,812 | ||
Income (Loss) from Operations | 6,768 | 7,316 | 20,863 | 22,045 | ||
Depreciation of property, plant and equipment | 859 | 758 | 2,171 | 2,306 | ||
Pension Expense | 291 | 81 | 871 | 685 | ||
Identifiable Assets | 160,120 | 160,120 | 91,630 | |||
Operating Segments [Member] | Education [Member] | Intersubsegment Eliminations [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | (530) | (642) | (1,617) | (1,438) | ||
Income (Loss) from Operations | (43) | (59) | (32) | (36) | ||
Operating Segments [Member] | Television Broadcasting [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 130,014 | 101,295 | 352,902 | 298,893 | ||
Income (Loss) from Operations | 55,453 | 33,462 | 137,113 | 99,722 | ||
Depreciation of property, plant and equipment | 3,198 | 3,118 | 9,243 | 8,703 | ||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | 1,408 | 1,071 | 4,224 | 2,943 | ||
Pension Expense | 544 | 485 | 1,638 | 1,457 | ||
Identifiable Assets | 455,746 | 455,746 | 455,884 | |||
Operating Segments [Member] | Healthcare [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 35,486 | 40,473 | 111,315 | 115,592 | ||
Income (Loss) from Operations | (8,702) | 920 | (9,329) | 378 | ||
Depreciation of property, plant and equipment | 648 | 1,166 | 1,948 | 3,429 | ||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | 9,839 | 2,420 | 13,456 | 5,718 | ||
Pension Expense | 143 | 166 | 430 | 498 | ||
Identifiable Assets | 108,685 | 108,685 | 129,856 | |||
Operating Segments [Member] | Other Businesses [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 150,665 | 138,652 | 438,602 | 365,343 | ||
Income (Loss) from Operations | 4,613 | (7,021) | (136) | (25,961) | ||
Depreciation of property, plant and equipment | 2,865 | 3,354 | 8,830 | 8,539 | ||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | 6,449 | 6,389 | 18,987 | 25,367 | ||
Pension Expense | 346 | 277 | 1,013 | 843 | ||
Identifiable Assets | 819,419 | 819,419 | 855,399 | |||
Corporate Office [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | 0 | 0 | 0 | 0 | ||
Income (Loss) from Operations | (12,887) | (14,208) | (39,585) | (43,760) | ||
Depreciation of property, plant and equipment | 252 | 279 | 758 | 860 | ||
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets | 0 | 0 | 0 | 0 | ||
Pension Expense | 1,333 | 1,233 | 4,000 | 4,009 | ||
Identifiable Assets | 143,416 | 143,416 | $ 182,905 | |||
Intersegment Elimination [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Operating Revenues | $ 0 | $ 0 | $ (45) | $ 0 |