Document And Entity Information
Document And Entity Information | 9 Months Ended |
Sep. 30, 2019 | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | Clarivate Analytics Plc |
Entity Central Index Key | 0001764046 |
Document Type | POS AM |
Document Period End Date | Sep. 30, 2019 |
Amendment Flag | true |
Amendment Description | Pursuant to the Registration Statement on Form F-4 (Registration No. 333-229899) (the “Registration Statement”) of Clarivate Analytics Plc (“Clarivate”), Clarivate registered ordinary shares issuable in exchange for shares of common stock issuable upon exercise of outstanding warrants of Churchill Capital Corp (“Churchill”), including warrants underlying units of Churchill. Under their terms, each warrant automatically entitles the holder to purchase one ordinary share of Clarivate in lieu of one share of Churchill common stock. In Part II, Item 22 of the Registration Statement, Clarivate undertook to file this Post-Effective Amendment No. 1 to include any financial statements required by Item 8.A of Form 20-F at the start of any delayed offering or throughout a continuous offering. Pursuant to Item 512(a)(4) of Regulation S-K, financial statements and information otherwise required by Section 10(a)(3) of the Securities Act of 1933, as amended (the “Securities Act”), are not required to be furnished herewith, provided Clarivate includes in the proxy statement/prospectus (the “Prospectus”) included in the Registration Statement, by means hereof, financial statements required by Item 8.A of Form 20-F and other information as aforesaid. Clarivate filed the final Prospectus on April 26, 2019 pursuant to Rule 424(b)(3) under the Securities Act. This Post-Effective Amendment No. 1 includes a supplement (the “Supplement”) to the Prospectus containing the financial statements and other information required by Item 512(a)(4) of Regulation S-K. The Supplement updates the information contained in the Prospectus and should be read together therewith. |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | true |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||||
Cash and cash equivalents | $ 88,812 | $ 43,063 | $ 25,575 | $ 53,186 |
Restricted cash | 9 | 9 | 9 | 24,362 |
Accounts receivable, less allowance for doubtful accounts of $17,192, $16,392, $14,076, and $8,495 at June 30, 2019, September 30, 2019, December 31, 2018, and December 31, 2017 respectively | 226,997 | 270,584 | 331,295 | 317,808 |
Prepaid expenses | 34,927 | 39,238 | 31,021 | 28,395 |
Other current assets | 10,528 | 12,577 | 20,712 | 20,157 |
Total current assets | 361,273 | 365,471 | 408,612 | 443,908 |
Computer hardware and other property, net | 20,185 | 18,490 | 20,641 | 23,010 |
Other intangible assets, net | 1,856,346 | 1,884,521 | 1,958,520 | 2,160,087 |
Goodwill | 1,281,504 | 1,282,842 | 1,282,919 | 1,311,253 |
Other non-current assets | 19,368 | 23,890 | 26,556 | 60,029 |
Deferred income taxes | 19,808 | 18,072 | 12,426 | 6,824 |
Operating lease right-of-use assets | 91,809 | 94,950 | ||
Total Assets | 3,650,293 | 3,688,236 | 3,709,674 | 4,005,111 |
Current liabilities: | ||||
Accounts payable | 27,908 | 30,396 | 38,418 | 60,758 |
Accrued expenses and other current liabilities | 162,303 | 126,881 | 153,849 | 193,710 |
Current portion of deferred revenues | 330,786 | 404,753 | 391,102 | 361,260 |
Current portion of operating lease liabilities | 23,953 | 24,980 | ||
Current portion of long-term debt | 15,345 | 15,345 | 60,345 | 45,345 |
Total current liabilities | 560,295 | 602,355 | 643,714 | 661,073 |
Long-term debt | 1,305,364 | 1,307,919 | 1,930,177 | 1,967,735 |
Tax receivable agreement | 264,600 | 264,600 | ||
Non-current portion of deferred revenues | 21,299 | 22,236 | 17,112 | 15,796 |
Other non-current liabilities | 17,278 | 19,719 | 24,838 | 22,609 |
Deferred income taxes | 39,256 | 42,582 | 43,226 | 51,792 |
Operating lease liabilities | 69,694 | 72,171 | ||
Total liabilities | 2,277,786 | 2,331,582 | 2,659,067 | 2,719,005 |
Shareholders' equity: | ||||
Ordinary Shares, no par value; unlimited shares authorized at September 30, 2019, June 30, 2019, December 31, 2018 and December 31, 2017; 306,050,763, 305,268,497, 217,526,425 and 217,327,823 shares issued and outstanding at September 30, 2019, June 30, 2019, December 31, 2018 and December 31, 2017, respectively (as recast-See Note 1) | 2,137,917 | 2,128,209 | 1,677,510 | 1,662,221 |
Accumulated other comprehensive income | (6,959) | (2,273) | 5,358 | 13,984 |
Accumulated deficit | (758,451) | (769,282) | (632,261) | (390,099) |
Total shareholders' equity | 1,372,507 | 1,356,654 | 1,050,607 | 1,286,106 |
Total Liabilities and Shareholders' Equity | $ 3,650,293 | $ 3,688,236 | $ 3,709,674 | $ 4,005,111 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
CONSOLIDATED BALANCE SHEET | ||||
Allowance for doubtful accounts | $ 16,392 | $ 17,192 | $ 14,076 | $ 8,495 |
Capital stock, par value (in dollars per share) | $ 0 | $ 0 | $ 0 | $ 0 |
Capital stock, issued (in shares) | 306,050,763 | 305,268,497 | 217,526,425 | 217,327,823 |
Capital stock, outstanding (in shares) | 306,050,763 | 305,268,497 | 217,526,425 | 217,327,823 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
Revenues, net | $ 242,998 | $ 242,309 | $ 242,897 | $ 243,297 | $ 476,334 | $ 480,324 | $ 719,332 | $ 723,221 | $ 968,468 | $ 917,634 |
Operating costs and expenses: | ||||||||||
Cost of revenues, excluding depreciation and amortization | (87,117) | (87,629) | (93,993) | (102,042) | (176,896) | (207,212) | (264,013) | (301,205) | (396,499) | (394,215) |
Selling, general and administrative costs, excluding depreciation and amortization | (96,017) | (92,453) | (92,871) | (92,394) | (184,749) | (187,721) | (280,766) | (280,592) | (369,377) | (343,143) |
Share-based compensation expense | (9,567) | (33,932) | (3,660) | (2,842) | (37,108) | (7,022) | (46,675) | (10,682) | (13,715) | (17,663) |
Depreciation | (2,281) | (2,131) | (3,291) | (3,249) | (4,182) | (4,650) | (6,463) | (7,941) | (9,422) | (6,997) |
Amortization | (41,656) | (40,932) | (57,186) | (57,541) | (97,038) | (114,672) | (138,694) | (171,858) | (227,803) | (221,466) |
Transaction expenses | (8,645) | (23,158) | (18) | (33,428) | (593) | (42,073) | (611) | (2,457) | (2,245) | |
Transition, integration and other related expenses | (3,327) | (5,262) | (13,358) | (18,431) | (6,423) | (37,910) | (9,750) | (51,268) | (61,282) | (78,695) |
Legal settlement | 39,399 | 39,399 | ||||||||
Other operating income (expense), net | 2,057 | 6,607 | 2,549 | (1,228) | 990 | (866) | 3,047 | 1,683 | 6,379 | (237) |
Total operating expenses | (207,154) | (278,890) | (261,828) | (277,727) | (538,834) | (560,646) | (745,988) | (822,474) | (1,074,176) | (1,064,661) |
Income (loss) from operations | 35,844 | (36,581) | (18,931) | (34,430) | (62,500) | (80,322) | (26,656) | (99,253) | (105,708) | (147,027) |
Interest expense, net | (23,369) | (37,468) | (32,552) | (32,503) | (70,569) | (63,302) | (93,938) | (95,854) | (130,805) | (138,196) |
Income (loss) before income tax | 12,475 | (74,049) | (51,483) | (66,933) | (133,069) | (143,624) | (120,594) | (195,107) | (236,513) | (285,223) |
Benefit (provision) for income taxes | (1,644) | (3,712) | (3,244) | (11) | (3,952) | (357) | (5,596) | (3,601) | (5,649) | 21,293 |
Net income (loss) | $ 10,831 | $ (77,761) | $ (54,727) | $ (66,944) | $ (137,021) | $ (143,981) | $ (126,190) | $ (198,708) | $ (242,162) | $ (263,930) |
Per share: | ||||||||||
Basic | $ 0.04 | $ (0.29) | $ (0.25) | $ (0.31) | $ (0.57) | $ (0.66) | $ (0.48) | $ (0.91) | $ (1.11) | $ (1.22) |
Diluted | $ 0.03 | $ (0.29) | $ (0.25) | $ (0.31) | $ (0.57) | $ (0.66) | $ (0.48) | $ (0.91) | $ (1.11) | $ (1.22) |
Weighted-average shares outstanding: | ||||||||||
Basic | 305,428,062 | 264,762,720 | 217,506,553 | 217,461,225 | 241,275,061 | 217,411,896 | 262,894,388 | 217,450,475 | 217,472,870 | 216,848,866 |
Diluted | 328,854,063 | 264,762,720 | 217,506,553 | 217,461,225 | 241,275,061 | 217,411,896 | 262,894,388 | 217,450,475 | 217,472,870 | 216,848,866 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||
Net income (loss) | $ 10,831 | $ (77,761) | $ (54,727) | $ (66,944) | $ (137,021) | $ (143,981) | $ (126,190) | $ (198,708) | $ (242,162) | $ (263,930) |
Other comprehensive income (loss): | ||||||||||
Interest rate swaps, net of $0 tax in all periods | (1,061) | (3,845) | 724 | 1,725 | (5,791) | 5,223 | (6,852) | 5,947 | 2,537 | 1,107 |
Defined benefit pension plans, net of tax (benefit) provision of ($91) and $430, respectively | (17) | 881 | ||||||||
Actuarial gain (loss) | 19 | (8) | 19 | 0 | (8) | 0 | 49 | 57 | ||
Foreign currency translation adjustments | (3,682) | (8) | (3,170) | (7,229) | (1,832) | (4,191) | (5,514) | (7,361) | (11,146) | 15,466 |
Total other comprehensive income (loss), net of tax | (4,724) | (3,861) | (2,427) | (5,504) | (7,631) | 1,032 | (12,317) | (1,357) | (8,626) | 17,454 |
Comprehensive income (loss) | $ 6,107 | $ (81,622) | $ (57,154) | $ (72,448) | $ (144,652) | $ (142,949) | $ (138,507) | $ (200,065) | $ (250,788) | $ (246,476) |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Interest rate swaps, tax | $ 0 | $ 0 |
Defined benefit pension plans, tax (benefit) provision | $ (91) | $ 430 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Share Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Originally Reported [Member] | Originally Reported [Member]Share Capital | Originally Reported [Member]Accumulated Other Comprehensive Income (Loss) | Originally Reported [Member]Accumulated Deficit |
Balance at the beginning at Dec. 31, 2016 | $ 1,505,361 | $ 1,635,000 | $ (3,470) | $ (126,169) | $ 1,505,361 | $ 1,635,000 | $ (3,470) | $ (126,169) |
Balance at beginning of the period (in shares) at Dec. 31, 2016 | 216,043,455 | 1,635,000 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Tax Receivable Agreement | $ 0 | |||||||
Conversion of unites of share capital (in shares) | 214,408,455 | |||||||
Issuance of common stock, net | 9,558 | $ 9,558 | ||||||
Issuance of common stock, net (in shares) | 1,284,368 | |||||||
Share-based compensation | 17,663 | $ 17,663 | ||||||
Comprehensive Income (loss) | (246,476) | 17,454 | (263,930) | |||||
Balance at the end at Dec. 31, 2017 | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) |
Balance at end of the period (in shares) at Dec. 31, 2017 | 217,327,823 | 1,644,720 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Conversion of unites of share capital (in shares) | 215,683,103 | |||||||
Issuance of common stock, net | 1,014 | $ 1,014 | ||||||
Issuance of common stock, net (in shares) | 128,172 | |||||||
Share-based compensation | 4,180 | $ 4,180 | ||||||
Comprehensive Income (loss) | (70,501) | 6,536 | (77,037) | |||||
Balance at the end at Mar. 31, 2018 | 1,220,799 | $ 1,667,415 | 20,520 | (467,136) | ||||
Balance at end of the period (in shares) at Mar. 31, 2018 | 217,455,995 | |||||||
Balance at the beginning at Dec. 31, 2017 | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) |
Balance at beginning of the period (in shares) at Dec. 31, 2017 | 217,327,823 | 1,644,720 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Comprehensive Income (loss) | (142,949) | |||||||
Balance at the end at Jun. 30, 2018 | 1,151,548 | $ 1,670,612 | 15,016 | (534,080) | ||||
Balance at end of the period (in shares) at Jun. 30, 2018 | 217,502,242 | |||||||
Balance at the beginning at Dec. 31, 2017 | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) |
Balance at beginning of the period (in shares) at Dec. 31, 2017 | 217,327,823 | 1,644,720 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Comprehensive Income (loss) | (200,065) | |||||||
Balance at the end at Sep. 30, 2018 | 1,098,104 | $ 1,674,322 | 12,589 | (588,807) | ||||
Balance at end of the period (in shares) at Sep. 30, 2018 | 217,515,589 | |||||||
Balance at the beginning at Dec. 31, 2017 | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) | 1,286,106 | $ 1,662,221 | 13,984 | (390,099) |
Balance at beginning of the period (in shares) at Dec. 31, 2017 | 217,327,823 | 1,644,720 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Conversion of unites of share capital (in shares) | 215,683,103 | |||||||
Issuance of common stock, net | 1,574 | $ 1,574 | ||||||
Issuance of common stock, net (in shares) | 198,602 | |||||||
Share-based compensation | 13,715 | $ 13,715 | ||||||
Comprehensive Income (loss) | (250,788) | (8,626) | (242,162) | |||||
Balance at the end at Dec. 31, 2018 | 1,050,607 | $ 1,677,510 | 5,358 | (632,261) | 1,050,607 | $ 1,677,510 | 5,358 | (632,261) |
Balance at end of the period (in shares) at Dec. 31, 2018 | 217,526,425 | 1,646,223 | ||||||
Balance at the beginning at Mar. 31, 2018 | 1,220,799 | $ 1,667,415 | 20,520 | (467,136) | ||||
Balance at beginning of the period (in shares) at Mar. 31, 2018 | 217,455,995 | |||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Issuance of common stock, net | 355 | $ 355 | ||||||
Issuance of common stock, net (in shares) | 46,247 | |||||||
Share-based compensation | 2,842 | $ 2,842 | ||||||
Comprehensive Income (loss) | (72,448) | (5,504) | (66,944) | |||||
Balance at the end at Jun. 30, 2018 | 1,151,548 | $ 1,670,612 | 15,016 | (534,080) | ||||
Balance at end of the period (in shares) at Jun. 30, 2018 | 217,502,242 | |||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Issuance of common stock, net | 50 | $ 50 | ||||||
Issuance of common stock, net (in shares) | 13,347 | |||||||
Share-based compensation | 3,660 | $ 3,660 | ||||||
Comprehensive Income (loss) | (57,154) | (2,427) | (54,727) | |||||
Balance at the end at Sep. 30, 2018 | 1,098,104 | $ 1,674,322 | 12,589 | (588,807) | ||||
Balance at end of the period (in shares) at Sep. 30, 2018 | 217,515,589 | |||||||
Balance at the beginning at Jun. 30, 2018 | $ 1,151,548 | $ 1,670,612 | 15,016 | (534,080) | ||||
Balance at beginning of the period (in shares) at Jun. 30, 2018 | 217,502,242 | |||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Conversion of unites of share capital (in shares) | 215,880,202 | |||||||
Balance at the end at Dec. 31, 2018 | $ 1,050,607 | $ 1,677,510 | 5,358 | (632,261) | 1,050,607 | $ 1,677,510 | 5,358 | (632,261) |
Balance at end of the period (in shares) at Dec. 31, 2018 | 217,526,425 | 1,646,223 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Conversion of unites of share capital (in shares) | 215,880,202 | |||||||
Issuance of common stock, net (in shares) | 2 | |||||||
Share-based compensation | 3,176 | $ 3,176 | ||||||
Comprehensive Income (loss) | (63,011) | (3,751) | (59,260) | |||||
Balance at the end at Mar. 31, 2019 | 990,772 | $ 1,680,686 | 1,607 | (691,521) | ||||
Balance at end of the period (in shares) at Mar. 31, 2019 | 217,526,427 | |||||||
Balance at the beginning at Dec. 31, 2018 | 1,050,607 | $ 1,677,510 | 5,358 | (632,261) | 1,050,607 | $ 1,677,510 | 5,358 | (632,261) |
Balance at beginning of the period (in shares) at Dec. 31, 2018 | 217,526,425 | 1,646,223 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Comprehensive Income (loss) | (144,652) | |||||||
Balance at the end at Jun. 30, 2019 | 1,356,654 | $ 2,128,209 | (2,235) | (769,282) | ||||
Balance at end of the period (in shares) at Jun. 30, 2019 | 305,268,497 | |||||||
Balance at the beginning at Dec. 31, 2018 | 1,050,607 | $ 1,677,510 | 5,358 | (632,261) | $ 1,050,607 | $ 1,677,510 | $ 5,358 | $ (632,261) |
Balance at beginning of the period (in shares) at Dec. 31, 2018 | 217,526,425 | 1,646,223 | ||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Comprehensive Income (loss) | (138,507) | |||||||
Balance at the end at Sep. 30, 2019 | 1,372,507 | $ 2,137,917 | (6,959) | (758,451) | ||||
Balance at end of the period (in shares) at Sep. 30, 2019 | 306,050,763 | |||||||
Balance at the beginning at Mar. 31, 2019 | 990,772 | $ 1,680,686 | 1,607 | (691,521) | ||||
Balance at beginning of the period (in shares) at Mar. 31, 2019 | 217,526,427 | |||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Tax Receivable Agreement | (264,600) | $ (264,600) | ||||||
Issuance of common stock, net | 137 | $ 137 | ||||||
Issuance of common stock, net (in shares) | (7,929) | |||||||
Merger recapitalization | 678,054 | $ 678,054 | ||||||
Merger recapitalization (in shares) | 87,749,999 | |||||||
Share-based compensation | 33,932 | $ 33,932 | ||||||
Comprehensive Income (loss) | (81,622) | (3,842) | (77,761) | |||||
Balance at the end at Jun. 30, 2019 | 1,356,654 | $ 2,128,209 | (2,235) | (769,282) | ||||
Balance at end of the period (in shares) at Jun. 30, 2019 | 305,268,497 | |||||||
Increase (Decrease) in Shareholders' Equity | ||||||||
Issuance of common stock, net | 141 | $ 141 | ||||||
Issuance of common stock, net (in shares) | 782,266 | |||||||
Share-based compensation | 9,567 | $ 9,567 | ||||||
Comprehensive Income (loss) | 6,107 | (4,724) | 10,831 | |||||
Balance at the end at Sep. 30, 2019 | $ 1,372,507 | $ 2,137,917 | $ (6,959) | $ (758,451) | ||||
Balance at end of the period (in shares) at Sep. 30, 2019 | 306,050,763 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash Flows From Operating Activities | ||||||
Net loss | $ (137,021) | $ (143,981) | $ (126,190) | $ (198,708) | $ (242,162) | $ (263,930) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 101,220 | 119,322 | 145,157 | 179,799 | 237,225 | 228,463 |
Bad debt expense | 2,478 | 4,259 | 1,869 | 5,611 | 6,507 | 6,505 |
Deferred income tax benefit | (4,603) | (3,722) | (8,222) | (7,204) | (14,967) | (35,738) |
Share-based compensation | 37,108 | 7,022 | 46,675 | 10,682 | 13,715 | 17,663 |
Gain on sale of IPM Product Line | (39,104) | |||||
Deferred finance charges | 13,144 | 4,306 | 14,678 | 6,450 | 9,182 | 23,510 |
Tax indemnity write-off | 33,819 | |||||
Other operating activities | (1,492) | (415) | (1,708) | (2,718) | (3,979) | 2,548 |
Changes in operating assets and liabilities: | ||||||
Accounts receivable | 57,607 | 64,130 | 99,470 | 60,423 | (50,906) | 43,109 |
Prepaid expenses | (7,125) | (9,629) | (3,010) | (846) | (2,936) | (4,052) |
Other assets | 3,919 | 714 | 7,977 | (3,252) | 578 | 10,799 |
Accounts payable | (8,018) | (7,998) | (9,662) | 26,304 | (18,091) | (39,660) |
Accrued expenses and other current liabilities | (28,827) | (32,008) | 3,388 | (17,539) | 9,842 | (6,038) |
Deferred revenues | 19,404 | 31,965 | (51,100) | (32,765) | 33,539 | 18,751 |
Operating lease liabilities | (6,434) | (9,934) | ||||
Operating lease right of use assets | 6,297 | 9,438 | ||||
Other liabilities | (4,770) | (3,014) | (6,338) | (1,195) | 774 | 5,271 |
Net cash used in (provided by) operating activities | 42,887 | 30,951 | 112,488 | 25,042 | (26,100) | 6,667 |
Cash Flows From Investing Activities | ||||||
Capital expenditures | (24,871) | (24,143) | (43,681) | (36,202) | (45,410) | (37,804) |
Acquisitions, net of cash acquired | (3,497) | (3,497) | (23,539) | (7,401) | ||
Acquisition of intangible assets | (2,625) | |||||
Proceeds from sale of Product Line, net of restricted cash | 80,883 | |||||
Proceeds from sale of equity method investment | 5,000 | |||||
Net cash (used in) provided by investing activities | (24,871) | (27,640) | (46,306) | (39,699) | 11,934 | (40,205) |
Cash Flows used in Financing Activities | ||||||
Borrowings of debt | 45,000 | 30,000 | ||||
Repayment of principal on long-term debt | (637,672) | (7,672) | (641,508) | (11,509) | (46,709) | (15,423) |
Repayment Of Principal On Long Term Tebt | (50,000) | (30,000) | (50,000) | (30,000) | (30,000) | |
Proceeds from revolving credit facility | 5,000 | 5,000 | 35,000 | |||
Proceeds from reverse recapitalization | 682,087 | 682,087 | ||||
Payment of debt issuance costs | (817) | |||||
Contingent purchase price payment | (2,470) | (2,470) | ||||
Issuance of common stock, net | 137 | 1,369 | 278 | 1,419 | 1,574 | 9,058 |
Net cash (used in) provided by financing activities | (448) | (36,303) | (4,143) | (7,560) | (32,605) | 22,818 |
Effects of exchange rates | (80) | (734) | 1,198 | (1,603) | (5,193) | 3,248 |
Net increase (decrease) in cash and cash equivalents, and restricted cash | 17,488 | (33,726) | 63,237 | (23,820) | (51,964) | (7,472) |
Beginning of period: | ||||||
Cash and cash equivalents | 25,575 | 53,186 | 25,575 | 53,186 | 53,186 | 77,136 |
Restricted cash | 9 | 24,362 | 9 | 24,362 | 24,362 | 7,884 |
Total cash and cash equivalents, and restricted cash, beginning of period | 25,584 | 77,548 | 25,584 | 77,548 | 77,548 | 85,020 |
Less: Cash included in assets held for sale, end of period | (25,382) | |||||
Cash and cash equivalents | 43,063 | 29,721 | 88,812 | 28,336 | 25,575 | 53,186 |
Restricted cash | 9 | 14,101 | 9 | 10 | 9 | 24,362 |
Cash and cash equivalents, and restricted cash, end of period | 43,072 | 43,822 | 88,821 | 28,346 | 25,584 | 77,548 |
Supplemental Cash Flow Information | ||||||
Cash paid for interest | 57,551 | 59,480 | 69,711 | 80,063 | 121,916 | 115,236 |
Cash paid for income tax | 14,573 | 6,641 | 21,128 | 10,303 | 13,210 | 14,722 |
Capital expenditures included in accounts payable | 7,697 | $ 2,473 | 9,759 | $ 6,965 | $ 5,166 | $ 2,473 |
Tax receivable agreement included in liabilities | 264,600 | 264,600 | ||||
Assets received as reverse recapitalization capital | 1,877 | 1,877 | ||||
Liabilities assumed as reduction of reverse recapitalization capital | $ 5,910 | $ 5,910 |
Background and Nature of Operat
Background and Nature of Operations | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Background and Nature of Operations | |||
Background and Nature of Operations | Note 1: Background and Nature of Operations Clarivate Analytics Plc (“Clarivate,” “us,” “we,” “our,” or the “Company”), a public limited company organized under the laws of Jersey, Channel Islands, was incorporated as a Jersey limited company on January 7, 2019. Pursuant to the definitive agreement entered into to effect a merger between Camelot Holdings (Jersey) Limited (“Jersey”) and Churchill Capital Corp, a Delaware corporation, (“Churchill”) (the “Transactions”), the Company was formed for the purposes of completing the Transactions and related transitions and carrying on the business of Jersey, and its subsidiaries. In January 2019, we entered into an Agreement and Plan of Merger (as amended by Amendment No. 1 to the Agreement and Plan of Merger, dated February 26, 2019, and Amendment No. 2 to the Agreement and Plan of Merger, dated March 29, 2019, collectively, the “Merger Agreement”) by and among Churchill, Jersey, CCC Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Clarivate (“Delaware Merger Sub”), Camelot Merger Sub (Jersey) Limited, a private limited company organized under the laws of Jersey, Channel Islands and wholly owned subsidiary of Clarivate (“Jersey Merger Sub”), and the Company, which, among other things, provided for (i) Jersey Merger Sub to be merged with and into Jersey with the Jersey being the surviving company in the merger (the “Jersey Merger”) and (ii) Delaware Merger Sub to be merged with and into Churchill with Churchill being the surviving corporation in the merger (the “Delaware Merger”, and together with the Jersey Merger, the “Mergers”. On May 13, 2019, the Transactions were consummated, and Clarivate became the sole managing member of Jersey, operating and controlling all of the business and affairs of Jersey, through Jersey and its subsidiaries. Following the consummation of the Transactions on May 13, 2019, the Company’s ordinary shares and warrants began trading on the New York Stock Exchange. See Note 4 - #8220;The Transactions” for more information. The Transactions were accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting Churchill was treated as the “acquired” company for financial reporting purposes. This determination was primarily based on post Transactions relative voting rights, composition of the governing board, size of the two entities pre-merger, and intent of the Transactions. Accordingly, for accounting purposes, the Transactions were treated as the equivalent of the Company issuing stock for the net assets of Churchill. The net assets of Churchill, were stated at historical cost, with no goodwill or other intangible assets resulting from the Transactions. Reported amounts from operations included herein prior to the Transactions are those of Jersey. Jersey and its subsidiaries was formed on August 4, 2016 as a private limited liability company organized under the laws of the Island of Jersey. Its registered office is located at 4th Floor, St Paul’s Gate, 22-24 New Street, St Helier, Jersey JE1 4TR. The Company is a provider of proprietary and comprehensive content, analytics, professional services and workflow solutions that enables users across government and academic institutions, life science companies and research and development (“R&D”) intensive corporations to discover, protect and commercialize their innovations. Our Science Product Group consists of our Web of Science and Life Science Product Lines. Both product lines provide curated, high-value, structured information that is delivered and embedded into the workflows of our customers, which include research intensive corporations, life science organizations and universities world-wide. Our Intellectual Property (“IP”) Product Group consists of our Derwent, CompuMark and MarkMonitor Product Lines. These Product lines help manage customer’s end-to-end portfolio of intellectual property from patents to trademarks to corporate website domains. On July 10, 2016, Camelot UK Bidco Limited, a private limited liability company incorporated under the laws of England and Wales, and a direct wholly owned subsidiary of Camelot UK Holdco Limited, a direct wholly owned subsidiary (“UK Holdco”), collectively referred to as (“Bidco”), entered into a separation agreement to acquire (i) certain assets and liabilities related to the Intellectual Property & Science business (“IP&S”) business from our Former Parent and (ii) all of the equity interests and substantially all of the assets and liabilities of certain entities engaged in the IP&S business together with their subsidiaries (“2016 Transaction”). The 2016 Transaction total consideration was $3,566,599, net of cash acquired. Jersey is owned by affiliates of Onex Corporation and private investment funds managed by Baring Private Equity Asia GP VI, L.P (“Baring”) and certain co-investors and is controlled by Onex Corporation. Prior Period Expense Reclassifications In conjunction with the implementation of a new enterprise resource planning system during the quarter ended September 30, 2018, the Company performed an assessment of its Cost of revenues (“COR”) and Selling, general & administrative expenses (“SG&A”). As a result of this assessment, certain errors in classification between COR and SG&A were identified, impacting prior periods. In addition, the Company reclassified certain costs between COR and SG&A. Accordingly, the Company has performed a reclassification of certain prior period amounts to conform to the present period presentation. The Company has concluded that the reclassifications were not material individually or in aggregate to previously issued financial statements. The following table details the impact of the reclassifications on the Interim Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2018. Consolidated Statement of Operation As Previously As Reported Adjustment Reclassified Three Months Ended June 30, 2018 Cost of revenues, excluding depreciation and amortization $ (117,514) $ 15,472 $ (102,042) Selling, general and administrative costs, excluding depreciation and amortization $ (76,922) $ (15,472) $ (92,394) Six Months Ended June 30, 2018 Cost of revenues, excluding depreciation and amortization $ (240,416) $ 33,204 $ (207,212) Selling, general and administrative costs, excluding depreciation and amortization $ (154,517) $ (33,204) $ (187,721) We have also reclassified prior period Accounts payable to Accrued expenses and other current liabilities in our Interim Condensed Consolidated Balance Sheets to conform to the current period presentation. These items had no impact in our Interim Condensed Consolidated Statement of Operations or Interim Condensed Consolidated Statement of Cash Flows. | Note 1: Background and Nature of Operations Clarivate Analytics Plc (“Clarivate,” “us,” “we,” “our,” or the “Company”), a public limited company organized under the laws of Jersey, Channel Islands, was incorporated as a Jersey limited company on January 7, 2019. Pursuant to the definitive agreement entered into to effect a merger between Camelot Holdings (Jersey) Limited (“Jersey”) and Churchill Capital Corp, a Delaware corporation, (“Churchill”) (the “Transactions”), the Company was formed for the purposes of completing the Transactions and related transitions and carrying on the business of Jersey, and its subsidiaries. The Company is a provider of proprietary and comprehensive content, analytics, professional services and workflow solutions that enables users across government and academic institutions, life science companies and research and development (“R&D”) intensive corporations to discover, protect and commercialize their innovations. Our Science Product Group consists of our Web of Science and Life Science Product Lines. Both Product Lines provide curated, high-value, structured information that is delivered and embedded into the workflows of our customers, which include research intensive corporations, life science organizations and universities world-wide. Our Intellectual Property (“IP”) Product Group consists of our Derwent, CompuMark and MarkMonitor Product Lines. These Product Lines help manage customer’s end-to-end portfolio of intellectual property from patents to trademarks to corporate website domains. In January 2019, we entered into an Agreement and Plan of Merger (as amended by Amendment No. 1 to the Agreement and Plan of Merger, dated February 26, 2019, and Amendment No. 2 to the Agreement and Plan of Merger, dated March 29, 2019, collectively, the “Merger Agreement”) by and among Churchill, Jersey, CCC Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Clarivate (“Delaware Merger Sub”), Camelot Merger Sub (Jersey) Limited, a private limited company organized under the laws of Jersey, Channel Islands and wholly owned subsidiary of Clarivate (“Jersey Merger Sub”), and the Company, which, among other things, provided for (i) Jersey Merger Sub to be merged with and into Jersey with the Jersey being the surviving company in the merger (the “Jersey Merger”) and (ii) Delaware Merger Sub to be merged with and into Churchill with Churchill being the surviving corporation in the merger (the “Delaware Merger”), and together with the Jersey Merger, the “Mergers”. On May 13, 2019, the Transactions were consummated, and Clarivate became the sole managing member of Jersey, operating and controlling all of the business and affairs of Jersey, through Jersey and its subsidiaries. Following the consummation of the Transactions on May 13, 2019, the Company’s ordinary shares and warrants began trading on the New York Stock Exchange. See Note 4—“The Transactions” for more information. The Transactions were accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting Churchill was treated as the “acquired” company for financial reporting purposes. This determination was primarily based on post Transactions relative voting rights, composition of the governing board, size of the two entities pre-merger, and intent of the Transactions. Accordingly, for accounting purposes, the Transactions were treated as the equivalent of the Company issuing stock for the net assets of Churchill. The net assets of Churchill, were stated at historical cost, with no goodwill or other intangible assets resulting from the Transactions. Reported amounts from operations included herein prior to the Transactions are those of Jersey. On September 10, 2019 the Company issued a public offering of 34,500,000 ordinary shares (the "Secondary Offering") by affiliated funds of Onex Corporation and Baring Private Equity Asia Limited ("BPEA"), together with certain other shareholders, at $16.00 per share. The Company did not receive any of the proceeds from the sale of its ordinary shares by the selling shareholders. Jersey was formed on August 4, 2016 as a private limited liability company organized under the laws of the Island of Jersey. Its registered office is located at 4th Floor, St Paul’s Gate, 22-24 New Street, St Helier, Jersey JE1 4TR. On July 10, 2016, Camelot UK Bidco Limited, a private limited liability company incorporated under the laws of England and Wales, and a direct wholly owned subsidiary of Camelot UK Holdco Limited, a direct wholly owned subsidiary (“UK Holdco”), collectively referred to as (“Bidco”), entered into a separation agreement to acquire (i) certain assets and liabilities related to the Intellectual Property & Science business (“IP&S”) business from our Thomson Reuters Corporation ("Former Parent") and (ii) all of the equity interests and substantially all of the assets and liabilities of certain entities engaged in the IP&S business together with their subsidiaries (“2016 Transaction”). The 2016 Transaction total consideration was $3,566,599, net of cash acquired. Jersey is owned by affiliates of Onex Corporation and private investment funds managed by Baring Private Equity Asia GP VI, L.P (“Baring”) and certain co-investors. | Note 1: Background and Nature of Operations Camelot Holdings (Jersey) Limited and its subsidiaries (“Jersey,” “us,” “we,” “our,” or the “Company”) was formed on August 4, 2016 as a private limited liability company organized under the laws of the Island of Jersey. Its registered office is located at 4th Floor, St Paul’s Gate, 22‑24 New Street, St Helier, Jersey JE1 4TR. On July 10, 2016, Camelot UK Bidco Limited, a private limited liability company incorporated under the laws of England and Wales, and a direct wholly owned subsidiary of Camelot UK Holdco Limited, a direct wholly owned subsidiary (“UK Holdco”), collectively referred to as (“Bidco”), entered into a separation agreement to acquire (i) certain assets and liabilities related to the Intellectual Property & Science business (“IP&S”) business from Thomson Reuters Corporation (“Former Parent”) and (ii) all of the equity interests and substantially all of the assets and liabilities of certain entities engaged in the IP&S business together with their subsidiaries (“2016 Transaction”). The 2016 Transaction total consideration was $3,566,599, net of cash acquired. Jersey is owned by affiliates of Onex Corporation and private investment funds managed by Baring Private Equity Asia GP VI, L.P. (“Baring”) and certain co-investors and is controlled by Onex Corporation. On May 13, 2019, the Company completed a series of transactions to effect the merger between Jersey and Churchill Capital Corp, a Delaware corporation (“Churchill”) (the “Transactions”). As part of completing the Transaction, Clarivate Analytics Plc, a public limited company organized under the laws of Jersey, Channel Islands, was incorporated as a Jersey limited company on January 7, 2019. Clarivate Analytics Plc was formed for the purposes of completing the Transactions and related transitions and carrying on the business of Jersey. The Transactions were accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Churchill was treated as the “acquired” company for financial reporting purposes. This determination was primarily based on post Transactions relative voting rights, composition of the governing board, size of the two entities pre-merger, and intent of the Transactions. Accordingly, for accounting purposes, the Transactions were treated as the equivalent of the Company issuing stock for the net assets of Churchill. The net assets of Churchill were stated at historical cost, with no goodwill or other intangible assets resulting from the Transactions. Accordingly, the entity formerly known as Camelot Holdings (Jersey) Limited has reflected these changes in the historical periods presented herein. Reported amounts from operations included herein prior to the Transactions are those of Jersey. Due to the reverse capitalization that occurred, the shares and loss per share available to holders of the Company’s shares prior to the Transactions have been recast for all periods presented to reflect the exchange ratio established in the Transactions (1.0 Jersey share to 132.13667 Clarivate Analytics Plc shares). Refer to the Consolidated Statement of Changes in Equity and Note 17 for additional disclosures. Prior to the Transactions, the Company operated under its 2016 Equity Incentive Plan, which provided for certain employees of the Company to be eligible to participate in equity ownership in the Company. On May 8, 2019, in anticipation of the Transactions, the Board adopted the 2019 Incentive Award Plan, which was an amendment, restatement and continuation of the 2016 Equity Incentive Plan. Upon closing of the Transactions, awards under the 2016 Equity Incentive Plan were converted using the exchange ratio established during the Transactions and assumed into the 2019 Incentive Award Plan. The Company is a provider of proprietary and comprehensive content, analytics, professional services and workflow solutions that enables users across government and academic institutions, life science companies and research and development (“R&D”) intensive corporations to discover, protect and commercialize their innovations. Our Science Group consists of our Web of Science and Life Science Product Lines. Both product lines provide curated, high-value, structured information that is delivered and embedded into the workflows of our customers, which include research intensive corporations, life science organizations and universities world-wide. Our Intellectual Property Group consists of our Derwent, CompuMark and MarkMonitor Product Lines. These Product lines help manage customer’s end-to-end portfolio of intellectual property from patents to trademarks to corporate website domains. Prior Period Expense Reclassifications In conjunction with the implementation of a new enterprise resource planning system during the quarter ended September 30, 2018, the Company performed an assessment of its Cost of revenues (COR) and Selling, general & administrative expenses (SG&A). As a result of this assessment, certain errors in classification between COR and SG&A were identified, impacting prior periods. Similarly, the Company reclassified certain costs between COR and SG&A. Accordingly, the Company has performed a reclassification of certain prior period amounts to conform to the present period presentation. The Company has concluded that the reclassifications were not material individually or in aggregate to previously issued financial statements. The following table details the impact of the reclassifications on the Consolidated Statements of Operations for 2017. Year Ended December 31, 2017 As Previously As Reported Adjustment Reclassified* Consolidated Statements of Operations Cost of revenues, excluding depreciation and amortization $ (422,213) $ 27,949 $ (394,264) Selling, general and administrative costs, excluding depreciation and amortization $ (318,887) $ (27,949) $ (346,836) *The “As reclassified” balance is prior to newly adopted accounting standards discussed in Note 3 — Summary of Significant Accounting Policies. We have also reclassified prior period Accounts payable to Accrued expenses and other current liabilities in our Consolidated Balance Sheets to conform to the current period presentation. These items had no impact in our Consolidated Statement of Operations or Consolidated Statement of Cash Flows. |
Basis of Presentation
Basis of Presentation | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Basis of Presentation | |||
Basis of Presentation | Note 2: Basis of Presentation The accompanying unaudited condensed consolidated financial statements for the three and six months ended June 30, 2019 and 2018 were prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The condensed consolidated financial statements do not include all of the information or notes necessary for a complete presentation in accordance with U.S. GAAP. Accordingly, these condensed consolidated financial statements should be read in conjunction with the Company’s annual financial statements as of and for the year ended December 31, 2018. The results of operations for the three and six months ended June 30, 2019 and 2018 are not necessarily indicative of the operating results for the full year. In the opinion of management, the interim financial data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results for the interim periods presented. The condensed consolidated financial statements of the Company include the accounts of all of its subsidiaries. Subsidiaries are entities over which the Company has control, where control is defined as the power to govern financial and operating policies. Generally, the Company has a shareholding of more than 50% of the voting rights in its subsidiaries. The effect of potential voting rights that are currently exercisable are considered when assessing whether control exists. Subsidiaries are fully consolidated from the date control is transferred to the Company, and are de-consolidated from the date control ceases. Intercompany accounts and transactions have been eliminated in consolidation. The U.S. dollar is the Company’s reporting currency. | Note 2: Basis of Presentation The accompanying unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2019 and 2018 were prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The condensed consolidated financial statements do not include all of the information or notes necessary for a complete presentation in accordance with U.S. GAAP. Accordingly, these condensed consolidated financial statements should be read in conjunction with the Company’s annual financial statements as of and for the year ended December 31, 2018. The results of operations for the three and nine months ended September 30, 2019 and 2018 are not necessarily indicative of the operating results for the full year. In the opinion of management, the interim financial data includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results for the interim periods presented. The condensed consolidated financial statements of the Company include the accounts of all of its subsidiaries. Subsidiaries are entities over which the Company has control, where control is defined as the power to govern financial and operating policies. Generally, the Company has a shareholding of more than 50% of the voting rights in its subsidiaries. The effect of potential voting rights that are currently exercisable are considered when assessing whether control exists. Subsidiaries are fully consolidated from the date control is transferred to the Company, and are de-consolidated from the date control ceases. Intercompany accounts and transactions have been eliminated in consolidation. The U.S. dollar is the Company’s reporting currency. | Note 2: Basis of Presentation The accompanying consolidated financial statements for the years ended December 31, 2018 and 2017, respectively, were prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The consolidated financial statements of the Company include the accounts of all of its subsidiaries. Subsidiaries are entities over which the Company has control, where control is defined as the power to govern financial and operating policies. Generally, the Company has a shareholding of more than 50% of the voting rights in its subsidiaries. The effect of potential voting rights that are currently exercisable are considered when assessing whether control exists. Subsidiaries are fully consolidated from the date control is transferred to the Company, and are de-consolidated from the date control ceases. The U.S. dollar is Jersey’s reporting currency. As such, the financial statements are reported on a U.S. dollar basis. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Summary of Significant Accounting Policies | |||
Summary of Significant Accounting Policies | Note 3: Summary of Significant Accounting Policies Our significant accounting policies are those that we believe are important to the portrayal of our financial condition and results of operations, as well as those that involve significant judgments or estimates about matters that are inherently uncertain. There have been no material changes to the significant accounting policies discussed in Note 3 of our Annual Report on Form 20-F for the fiscal year ended December 31, 2018, which was filed with the SEC on May 17, 2019 and amended on June 17, 2019 (the “Annual Report”), except as noted below. Lease Accounting We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities on our interim condensed consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are accounted as a single lease component. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. Tax Receivable Agreement (“TRA”) Concurrent with the completion of the Transactions in May 2019, we became a party to a TRA with our pre- business combination equity holders. Under the TRA, we are generally required to pay to certain pre-business combination equity holders approximately 85% of the amount of calculated tax savings, if any, we are deemed to realize (using the actual applicable U.S. federal income tax rate and an assumed combined state and local income tax rate) as a result of (1) any existing tax attributes associated with Covered Tax Assets acquired in the pre-business combination organizational transactions, the benefit of which is allocable to us as a result of such transactions, (2) net operating loss (NOL) carryforwards available as a result of such transactions and (3) tax benefits related to imputed interest. Further, there may be significant changes, to the estimate of the TRA liability due to various reasons including changes in corporate tax law, changes in estimates of the amount or timing of future taxable income, and other items. Changes in those estimates are recognized as adjustments to the related TRA liability, with offsetting impacts recorded in the Interim Condensed Consolidated Statement of Operations as Other operating income (expense), net. Newly Adopted Accounting Standards In February 2016, the FASB issued new guidance, Accounting Standard Update (“ASU”) 2016-02, related to leases in which lessees are required to recognize assets and liabilities on the balance sheet for leases having a term of more than 12 months. Recognition of these lease assets and lease liabilities represents a change from previous GAAP, which did not require lease assets and lease liabilities to be recognized for operating leases. Qualitative disclosures along with specific quantitative disclosures will be required to provide enough information to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities. The Company adopted the standard on January 1, 2019. The provisions of ASU 2016-02 are effective for the Company’s fiscal year beginning January 1, 2019, including interim periods within that fiscal year. The Company elected the package of practical expedients included in this guidance, which allows it to not reassess whether any expired or existing contracts contain leases, the lease classification for any expired or existing leases, and the initial direct costs for existing leases. The Company does not recognize short-term leases on its Interim Condensed Consolidated Balance Sheet, and recognizes those lease payments in Selling, general and administrative costs, excluding depreciation and amortization on the Interim Condensed Consolidated Statements of Operations on a straight-line basis over the lease term. In July 2018, the FASB issued ASU 2018-11, Leases - Targeted Improvements, as an update to the previously-issued guidance. This update added a transition option which allows for the recognition of a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption without recasting the financial statements in periods prior to adoption. The Company elected this transition option. The standard had a material impact on our interim condensed consolidated balance sheet, but did not have an impact on our interim condensed consolidated statement of operations. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases. In June 2018, the FASB issued guidance, ASU 2018-07, Compensation - Stock Compensation, which simplifies the accounting for nonemployee share-based payment transactions. The guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In July 2018, the FASB issued guidance, ASU 2018-09, Codification Improvements, which clarifies guidance that may have been incorrectly or inconsistently applied by certain entities. The guidance is effective for all entities for fiscal years beginning after December 15, 2018. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In August 2018, the FASB issued guidance, ASU 2018-13, which modifies the disclosure requirements on fair value measurements. The guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 with early adoption permitted upon issuance of this update. The Company adopted this standard on January 1, 2019. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. Recently Issued Accounting Standards Except as noted below, there have been no material changes from the recently issued accounting standards previously disclosed in the Annual Report. Please refer to Note 3 — “Summary of Significant Accounting Policies” section of the Annual Report for a discussion of the recently issued accounting standards that relate to the Company. In March 2019, the FASB issued ASU 2019‑01, Leases, as an update to the previously-issued guidance. This update added a transition option which clarified the interim disclosure requirements as defined in Accounting Standard Codification 250-10-50-3. The Company elected to provide the ASU 2016-02 transition disclosures as of the beginning of the period of adoption rather than the beginning of the earliest period presented. The guidance is effective for all entities during the same period that ASU 2016-02 is adopted. In April 2019, the FASB issued ASU 2019-04, Codification Imrovements to Topic 326, which provides targeted improvements or clarification and correction to the ASU 2016-01 Financial Instruments Overall, ASU 2016-13 Financial Instruments Credit Losses, and ASU 2017-12 Derivatives and Hedging, accounting standards updates that were previously issued. The guidance is effective upon adoption of the related standards The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In April 2019, the FASB issued ASU 2019-05, Financial Instruments - Credit Losses, which provides targeted transition relief to the accounting standards update previously issued as part of ASU 2016-13 Financial Instruments Credit Losses. The guidance is effective for all entities during the same period that ASU 2016-13 is adopted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. | Note 3: Summary of Significant Accounting Policies Our significant accounting policies are those that we believe are important to the portrayal of our financial condition and results of operations, as well as those that involve significant judgments or estimates about matters that are inherently uncertain. There have been no material changes to the significant accounting policies discussed in Note 3 of our Annual Report on Form F-1 for the fiscal year ended December 31, 2018, which was filed with the SEC on September 9, 2019 (the “Annual Report”), except as noted below. Lease Accounting We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities on our Interim Condensed Consolidated Balance Sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are accounted as a single lease component. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. Tax Receivable Agreement (“TRA”) Concurrent with the completion of the Transactions in May 2019, we became a party to a TRA with our pre-business combination equity holders. Under the TRA, we are generally required to pay to certain pre-business combination equity holders approximately 85% of the amount of calculated tax savings, if any, we are deemed to realize (using the actual applicable U.S. federal income tax rate and an assumed combined state and local income tax rate) as a result of (1) any existing tax attributes associated with Covered Tax Assets acquired in the pre-business combination organizational transactions, the benefit of which is allocable to us as a result of such transactions, (2) net operating loss (NOL) carryforwards available as a result of such transactions and (3) tax benefits related to imputed interest. Further, there may be significant changes, to the estimate of the TRA liability due to various reasons including changes in corporate tax law, changes in estimates of the amount or timing of future taxable income, and other items. Changes in those estimates are recognized as adjustments to the related TRA liability, with offsetting impacts recorded in the Interim Condensed Consolidated Statement of Operations as Other operating income (expense), net. On August 21, 2019 the Company entered into a TRA Buyout Agreement to settle the outstanding liability. Any settlement of the original TRA liability pursuant to the TRA Buyout Agreement (to the extent that the settlement is less than the recorded liability) will be accounted for as an adjustment to Equity. Newly Adopted Accounting Standards In February 2016, the FASB issued new guidance, Accounting Standard Update (“ASU”) 2016-02, related to leases in which lessees are required to recognize assets and liabilities on the balance sheet for leases having a term of more than 12 months. Recognition of these lease assets and lease liabilities represents a change from previous GAAP, which did not require lease assets and lease liabilities to be recognized for operating leases. Qualitative disclosures along with specific quantitative disclosures will be required to provide enough information to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities. The Company adopted the standard on January 1, 2019. The provisions of ASU 2016-02 are effective for the Company’s fiscal year beginning January 1, 2019, including interim periods within that fiscal year. The Company elected the package of practical expedients included in this guidance, which allows it to not reassess whether any expired or existing contracts contain leases, the lease classification for any expired or existing leases, and the initial direct costs for existing leases. The Company does not recognize short-term leases on its Interim Condensed Consolidated Balance Sheet, and recognizes those lease payments in Selling, general and administrative costs, excluding depreciation and amortization on the Interim Condensed Consolidated Statements of Operations on a straight-line basis over the lease term. In July 2018, the FASB issued ASU 2018-11, Leases—Targeted Improvements, as an update to the previously-issued guidance. This update added a transition option which allows for the recognition of a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption without recasting the financial statements in periods prior to adoption. The Company elected this transition option. In March 2019, the FASB issued ASU 2019-01, Leases, as an update to the previously-issued guidance. This update added a transition option which clarified the interim disclosure requirements as defined in Accounting Standard Codification 250-10-50-3. The Company elected to provide the ASU 2016-02 transition disclosures as of the beginning of the period of adoption rather than the beginning of the earliest period presented. The guidance is effective for all entities during the same period that ASU 2016-02 is adopted. The standard had a material impact on our Interim Condensed Consolidated Balance Sheet, but did not have an impact on our Interim Condensed Consolidated Statement of Operations. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases. In June 2018, the FASB issued guidance, ASU 2018-07, Compensation— Stock Compensation, which simplifies the accounting for nonemployee share-based payment transactions. The guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In July 2018, the FASB issued guidance, ASU 2018-09, Codification Improvements, which clarifies guidance that may have been incorrectly or inconsistently applied by certain entities. The guidance is effective for all entities for fiscal years beginning after December 15, 2018. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In August 2018, the FASB issued guidance, ASU 2018-13, which modifies the disclosure requirements on fair value measurements. The guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 with early adoption permitted upon issuance of this update. The Company adopted this standard on January 1, 2019. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. Recently Issued Accounting Standards Except as noted below, there have been no material changes from the recently issued accounting standards previously disclosed in the Annual Report. Please refer to Note 3— “Summary of Significant Accounting Policies” section of the Annual Report for a discussion of the recently issued accounting standards that relate to the Company. In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, which provides targeted improvements or clarification and correction to the ASU 2016-01 Financial Instruments Overall, ASU 2016-13 Financial Instruments Credit Losses, and ASU 2017-12 Derivatives and Hedging, accounting standards updates that were previously issued. The guidance is effective upon adoption of the related standards The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In April 2019, the FASB issued ASU 2019-05, Financial Instruments— Credit Losses, which provides targeted transition relief to the accounting standards update previously issued as part of ASU 2016-13 Financial Instruments Credit Losses. The guidance is effective for all entities during the same period that ASU 2016-13 is adopted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. | Note 3: Summary of Significant Accounting Policies Business combinations The Company determines whether substantially all the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If this threshold is met, the set is not a business. If it is not met, the Company then evaluates whether the set meets the requirement that a business include, at a minimum, an input and as substantive process that together significantly contribute to the ability to create outputs. Business combinations are accounted for using the acquisition method at the acquisition date, which is when control is obtained. The consideration transferred is generally measured at fair value, as are the identifiable assets acquired and liabilities assumed. During the one-year period following the acquisition date, if an adjustment is identified based on new information about facts and circumstances that existed as of the acquisition date, the Company will record measurement-period adjustments related to the acquisitions in the period in which the adjustment is identified. Goodwill is measured at the acquisition date as the fair value of the consideration transferred (including, if applicable, the fair value of any previously held equity interest and any non-controlling interests) less the net recognized amount (which is generally the fair value) of the identifiable assets acquired and liabilities assumed. Transaction costs, other than those associated with the issuance of debt or equity securities incurred in connection with a business combination, are expensed as incurred and included in Transaction expenses in the Consolidated Statements of Operations. Principles of Consolidation The accompanying consolidated financial statements include the accounts and operations of the Company, and its subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The most important of these relate to share-based compensation expenses, revenues recognition, the allowance for doubtful accounts, internally developed computer software, valuation of goodwill and other identifiable intangible assets, determination of the projected benefit obligations of the defined benefit plans, income taxes, fair value of stock options, derivatives and financial instruments, contingent earn-out, and the tax related valuation allowances. On an ongoing basis, management evaluates these estimates, assumptions and judgments, in reference to historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Cash and Cash Equivalents Cash and cash equivalents is comprised of cash on hand and short-term deposits with an original maturity at the date of purchase of three months or less. Restricted Cash As of December 31, 2017, the Company’s restricted cash primarily related to funds the Company has received from customers in advance of paying patent renewals on behalf of those customers. This activity was specific to the IPM Product Line, which was sold on October 1, 2018 (See Note 5: Divested Operations, for further details), and was $0 at December 31, 2018. Accounts Receivable Accounts receivable are presented net of the allowance for doubtful accounts and any discounts. Accounts receivable are recorded at the invoiced amount and do not bear interest. Collections of accounts receivable are included in cash provided by operating activities in the Consolidated Statements of Cash Flows. The Company maintains an allowance for doubtful accounts for estimated losses and assesses its adequacy each reporting period by evaluating factors such as the length of time receivables are past due, historical collection experience, and the economic and competitive environment. The expense related to doubtful accounts is included within Selling, general and administrative costs, excluding depreciation and amortization in the Consolidated Statements of Operations. Account balances are written off against the allowance when the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. Concentration of Credit Risk Accounts receivable are the primary financial instrument that potentially subjects the Company to significant concentrations of credit risk. Account receivable represents arrangements in which services were transferred to a customer before the customer pays consideration or before payment is due. Contracts with payment in arrears are recognized as receivables after the Company considers whether a significant financing component exists. The Company does not require collateral or other securities to support customer receivables. Management performs ongoing credit evaluations of its customers’ financial condition and limits the amount of credit extended when deemed appropriate. Credit losses have been immaterial and reasonable within management’s expectations. No single customer accounted for more than 1% of revenues and our ten largest customers represented only 6% of revenues for the year ended December 31, 2018. The Company maintains its cash and cash equivalent balances with high-quality financial institutions and consequently, the Company believes that such funds are subject to minimal credit risk. Prepaid Assets Prepaid assets represent amounts that the Company has paid in advance of receiving benefits or services. Prepaid assets include amounts for system and service contracts, sales commissions, deposits, prepaid royalties and insurance and are recognized as an expense over the general contractual period that the Company expects to benefit from the underlying asset or service. Computer Hardware and Other Property Generally, computer hardware and other property are recorded at cost and are depreciated over the respective estimated useful lives. Upon the 2016 Transaction, computer hardware and other property were revalued and recorded at net book value, which approximated fair value at the 2016 Transaction. Depreciation is computed using the straight-line method. Repair and maintenance costs are expensed as incurred. The cost and related accumulated depreciation of sold or retired assets are removed from the accounts and any gain or loss is included within loss from operations in the Consolidated Statements of Operations. The estimated useful lives are as follows: Computer hardware 3 years Furniture, fixtures and equipment 5 – 7 years Leasehold improvements Lesser of lease term or estimated useful life Computer Software Development costs related to internally generated software are capitalized once a project has progressed beyond a conceptual, preliminary stage to that of the application development stage. Costs of significant improvements on existing software for internal use, both internally developed and purchased, are also capitalized. Costs related to the preliminary project stage, data conversion and post implementation/operation stage of an internal use software development project are expensed as incurred. Capitalized costs are amortized over five years, which is the estimated useful life of the related software. Purchased software is amortized over three years, which is the estimated useful life of the related software. The capitalized amounts, net of accumulated amortization, are included in Identifiable intangible assets, net in the Consolidated Balance Sheets. The cost and related accumulated amortization of sold or retired assets are removed from the accounts and any gain or loss is included in operating expense. Computer software is evaluated for impairment whenever circumstances indicate the carrying amount may not be recoverable. The test for impairment compares the carrying amounts with the sum of undiscounted cash flows related to the asset. If the carrying value is greater than the undiscounted cash flows of the asset, the asset is written down to its estimated fair value. Identifiable Intangible Assets, net Upon acquisition, identifiable intangible assets are recorded at fair value and are carried at cost less accumulated amortization or accumulated impairment for indefinite-lived intangible assets. Useful lives are reviewed at the end of each reporting period and adjusted if appropriate. Fully amortized assets are retained in cost and accumulated amortization accounts until such assets are derecognized. Customer Relationships — Customer relationships primarily consist of customer contracts and customer relationships arising from such contracts. Databases and Content — Databases and content primarily consists of repositories of the Company’s specific financial and customer information, and intellectual content. Trade Names — Trade names consist of purchased brand names that the Company continues to use. Where applicable, intangible assets are amortized on a straight-line basis over their estimated useful lives as follows: Customer relationships 2 – 4 years Databases and content 13 – 20 years Trade Names Indefinite Impairment of Long-Lived Assets Residual values and useful lives are reviewed at the end of each reporting period and adjusted if appropriate. The Company evaluates its long-lived assets, including computer hardware and other property, computer software, and finite-lived intangible assets for impairment whenever circumstances indicate that their carrying amounts may not be recoverable. Recoverability of these assets is measured by comparison of the carrying amount of each asset to the future undiscounted cash flows the asset is expected to generate over its remaining life. An asset is assessed for impairment at the lowest level that the asset generates cash inflows that are largely independent of cash inflows from other assets. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. Management determined that no impairment existed for any of the periods presented. Goodwill and Indefinite-Lived Intangible Assets The Company evaluates its goodwill for impairment at the reporting unit level, defined as an operating segment or one level below an operating segment, annually as of October 1 or more frequently if impairment indicators arise in accordance with ASC Topic 350. The Company identified one reporting unit for the year ended December 31, 2017 and five reporting units due to a change in the Company’s reporting structure for the year ended December 31, 2018. The Company evaluates the recoverability of goodwill using a two-step impairment test approach at the reporting unit level. In the first step, the Company assesses various qualitative factors to determine whether the fair value of a reporting unit may be less than its carrying amount. If a determination is made that, based on the qualitative factors, an impairment does not exist, the Company is not required to perform further testing. If the aforementioned qualitative assessment results in the Company concluding that it is more likely than not that the fair value of a reporting unit may be less than its carrying amount, the fair value of the reporting unit will be determined and compared to its carrying value including goodwill. In determining the fair value of a reporting unit, the Company estimates the fair value of a reporting unit using the fair value derived from the income approach, which is a change from the previous year which used a market approach. The market approach estimates fair value based on market multiples of revenues and earnings derived from comparable publicly-traded companies with similar operating and investment characteristics as the reporting unit; whereas, the income approach uses a discounted cash flow (“DCF”) model. The DCF model determines the fair value of our reporting units based on projected future discounted cash flows, which in turn were based on our views of uncertain variables such as growth rates, anticipated future economic conditions, and the appropriate discount rates relative to risk and estimates of residual values. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is not impaired and the Company is not required to perform further testing. If the fair value of the reporting unit is less than the carrying value, the Company will recognize the difference as an impairment charge. Management concluded that no goodwill impairment existed for any of the periods presented. The Company also has indefinite-lived intangible assets related to trade names. Indefinite-lived intangible assets are subject to impairment testing annually or whenever events or changes in circumstances indicate that their carrying value may not be recoverable. For purposes of impairment testing, the fair value of trade names is determined using an income approach, specifically the relief from royalties method. Management concluded that no indefinite-lived intangible impairment existed for any of the periods presented. Other Current and Non-Current Assets and Liabilities The Company defines current assets and liabilities as those from which it will benefit from or which it has an obligation for within one year that do not otherwise classify as assets or liabilities separately reported on the Consolidated Balance Sheets. Other non-current assets and liabilities are expected to benefit the Company or cause its obligation beyond one year. The Company classifies the current portion of long-term assets and liabilities as current assets or liabilities. Leases Leases are classified as either operating or capital, based on the substance of the transaction at inception of the lease. Classification is re-assessed if the terms of the lease are changed. Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments under an operating lease (net of any incentives received from the lessor) are recognized in the Consolidated Statements of Operations on a straight-line basis over the period of the lease. The Company does not currently have any capital leases. Accounts Payable and Accruals Accounts payable and accruals are obligations to pay for goods or services that have been acquired in the ordinary course of business. Accounts payable and accruals are recognized initially at their settlement value, and are classified as current liabilities if payment is due within one year or less. Debt Debt is recognized initially at par value, net of any applicable discounts or financing costs. Debt is subsequently stated at amortized cost with any difference between the proceeds (net of transactions costs) and the redemption value recognized in the Consolidated Statements of Operations over the term of the debt using the effective interest method. Interest on indebtedness is expensed as incurred. Debt is classified as a current liability when due within 12 months after the end of the reporting period. Derivative Financial Instruments Foreign Exchange Derivative Contracts Prior to the sale of IPM, the Company used derivative financial instruments to manage foreign currency exchange rate risk in IPM. The Company’s derivative financial instruments consist of foreign currency forward contracts (“forward contracts”). Derivative financial instruments were neither held nor issued by the Company for trading purposes. Interest Rate Swaps The Company has interest rate swaps with counterparties to reduce its exposure to variability in cash flows relating to interest payments on a portion of its outstanding first lien senior secured term loan facility in an aggregate principal amount of $1,550,000 (“Prior Term Loan Facility”). The Company applies hedge accounting and has designated these instruments as cash flow hedges of the risk associated with floating interest rates on designated future quarterly interest payments. Management assumes the hedge is highly effective and therefore changes in the value of the hedging instrument are recorded in Accumulated other comprehensive income in the Consolidated Balance Sheets. Any ineffectiveness is recorded in earnings. Amounts in Accumulated other comprehensive income (loss) are reclassified into earnings in the same period during which the hedged transactions affect earnings, or upon termination of the hedging relationship. Fair Value of Financial Instruments In determining fair value, the use of various valuation methodologies, including market, income and cost approaches is permissible. The Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. The accounting guidance for fair value measurements establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value based on the reliability of inputs. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Company’s interest rate swap derivative instruments are classified as Level 2. Earn-out liabilities and defined benefit plan assets are classified as Level 3. Contingent Considerations The Company records liabilities for the estimated cost of such contingencies when expenditures are probable and reasonably estimable. A significant amount of judgment is required to estimate and quantify the potential liability in these matters. We engage outside experts as deemed necessary or appropriate to assist in the calculation of the liability, however management is responsible for evaluating the estimate. As information becomes available regarding changes in circumstances for ongoing contingent considerations, our potential liability is reassessed and adjusted as necessary. See Note 19 — Commitments and Contingencies for further information on contingencies. Pension and Other Post-Retirement Benefits The Company may be required to sponsor pension benefit plans, for certain international markets, which are unfunded and are not significant for the Company. The net periodic pension expense is actuarially determined on an annual basis by independent actuaries using the projected unit credit method. The determination of benefit expense requires assumptions such as the discount rate, which is used to measure service cost, benefit plan obligations and the interest expense on the plan obligations. Other significant assumptions include expected mortality, the expected rate of increase with respect to future compensation and pension. Because the determination of the cost and obligations associated with employee future benefits requires the use of various assumptions, there is measurement uncertainty inherent in the actuarial valuation process. Actual results will differ from results which are estimated based on assumptions. The liability recognized in the Consolidated Balance Sheet is the present value of the defined benefit obligation at the end of the reporting period. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid and that have terms to maturity approximating the terms of the related pension liability. The defined benefit obligation is included in Other non-current liabilities in the Consolidated Balance Sheets. All actuarial gains and losses that arise in calculating the present value of the defined benefit obligation are recognized immediately in accumulated deficit and included in the consolidated statement of comprehensive income (loss). See Note 11 — Pension and Other Post Retirement Benefits for balances and further details including an estimate of the impact on the consolidated financial statements from changes in the most critical assumptions. Employer contributions to defined contribution plans are expensed as incurred, which is as the related employee service is rendered. Certain prior year amounts have been reclassified to conform to current year presentation. Taxation The Company recognizes income taxes under the asset and liability method. Our income tax expense, deferred tax assets and liabilities, and reserves for unrecognized tax benefits reflect our best assessment of estimated current and future taxes to be paid. Significant judgments and estimates are required in determining the consolidated income tax expense for financial statement purposes. Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, which will result in taxable or deductible amounts in the future. In assessing the realizability of deferred tax assets, we consider future taxable income by tax jurisdiction and tax planning strategies. The Company records a valuation allowance to reduce our deferred tax assets to equal an amount that is more likely than not to be realized. Changes in tax laws and tax rates could also affect recorded deferred tax assets and liabilities in the future. The calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across our global operations. Accounting Standards Codification (ASC) Topic 740, Income Taxes, states that a benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits. The Company first records unrecognized tax benefits as liabilities in accordance with ASC 740 and then adjusts these liabilities when our judgment changes as a result of the evaluation of new information not previously available at the time of establishing the liability. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. Interest accrued related to unrecognized tax benefits and income tax related penalties are included in the provision for income taxes. Deferred tax is provided on taxable temporary differences arising on investments in foreign subsidiaries, except where we intend, and are able, to reinvest such amounts on a permanent basis. Revenue Recognition The Company derives revenue by selling information on a subscription and single transaction basis as well as from performing professional services. The Company recognizes revenues when control of these services are transferred to the customer for an amount, referred to as the transaction price, that reflects the consideration to which the Company is expected to be entitled in exchange for those goods or services. The Company determines revenue recognition utilizing the following five steps: (1) identification of the contract with a customer, (2) identification of the performance obligations in the contract (promised goods or services that are distinct), (3) determination of the transaction price, (4) allocation of the transaction price to the performance obligations, and (5) recognition of revenues when, or as, the Company transfers control of the product or service for each performance obligation. Revenues are recognized net of discounts and rebates, as well as value added and other sales taxes. Cash received or receivable in advance of the delivery of the services or publications is included in deferred revenues. The Company disaggregates revenue based on revenue recognition pattern. Subscription based revenues are recognized over time whereas our transactional revenues are recognized at a point in time. The Company believes subscription and transaction is reflective of how the Company manages the business. The revenues recognition policies for the Company’s revenue streams are discussed below. Subscription Revenues Subscription-based revenues are recurring revenues that are earned under annual, evergreen or multi-year contracts pursuant to which we license the right to use our products to our customers. Revenues from the sale of subscription data and analytics solutions are typically invoiced annually in advance and recognized ratably over the year as revenues are earned. Subscription revenues are typically generated either on (i) an enterprise basis, meaning that the organization has a license for the particular product or service offering and then anyone within the organization can use it at no additional cost, (ii) a seat basis, meaning each individual that uses the particular product or service offering has to have his or her own license, or (iii) a unit basis, meaning that incremental revenues are generated on an existing subscription each time the product is used (e.g., a trademark or brand is searched or assessed). Transactional Revenues Transactional revenues are revenues that are earned under contracts for specific deliverables that are typically quoted on a product, data set or project basis and often derived from repeat customers, including customers that also generate subscription based revenues. Revenues from the sale of transactional products and services are invoiced according to the terms of the contract, typically in arrears. Transactional content sales are usually delivered to the customer instantly or in a short period of time, at which time revenues are recognized. In the case of professional services, these contracts vary in length from several months to years for multi-year projects and customers and typically invoices based on the achievement of milestones. Transactional revenues are typically generated on a unit basis, although for certain product and service offerings transactional revenues are generated on a seat basis. Transactional revenues may involve sales to the same customer on multiple occasions but with different products or services comprising the order. Performance Obligations Content Subscription: Domain Registration Services: Search Services: Trademark Watch: Patent Management: Variable Consideration In some cases, contracts provide for variable consideration that is contingent upon the occurrence of uncertain future events, such as retroactive discounts provided to the customers, indexed or volume based discounts, and revenues between contract expiration and renewal. Variable consideration is estimated at the expected value or at the most likely amount depending on the type of consideration. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenues recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimate of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of its anticipated performance and all information (historical, current, and forecasted) that is reasonably available to the Company. Significant Judgments Significant judgments and estimates are necessary for the allocation of the proceeds received from an arrangement to the multiple performance obligations and the appropriate timing of revenues recognition. Our contracts with customers often include promises to transfer multiple products and services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. Determining a standalone selling price that may not be directly observable amongst all the products and performance obligations requires judgment. Specifically, many Web of Science Product Line contracts include multiple product offerings, which may have both subscription and transactional revenues. Judgment is also required to determine whether the software license is considered distinct and accounted for separately, or not distinct and accounted for together with the subscription service and recognized over time for other products. The Company allocates value to primary content subscriptions or licenses and accompanying performance obligations, such as training subscriptions, access to historical content, maintenance and other optional content. When multiple performance obligations exist in a single contract, the transaction price is allocated to each performance obligation based on the standalone selling price of each performance obligation. The Company utilizes its standard price lists to determine the standalone selling price based on the product and country. The Company allocates the transaction price to each performance obligation based on the best estimate of the standalone selling price of each distinct good or service in the contract. The transaction price in the contract is allocated at contract inception to the distinct good or service underlying each performance obligation in proportion to the standalone selling price. The standalone selling prices are based on the Company’s normal pricing practices when sold separately with consideration of market conditions and other factors, including customer demographics and geographic location. Discounts applied to the contract will be allocated based on the same proportion of standalone selling prices. Cost to Obtain a Contract Commission costs represent costs to obtain a contract and are considered contract assets. The Company pays commissions to the sales managers and support teams for earning new customers and renewing contracts with existing customers. These commission costs are capitalized within Prepaid expenses and other non-current assets on the Consolidated Balance Sheet. The costs are amortized to Selling, general and administrative expenses within the Consolidated Statements of Operations. The amortization period is between one and five years based on the estimated length of the customer relationship. Deferred Revenues The timing of revenue recognition may differ from the timing of invoicing to customers. We record deferred revenues when revenues are recognized subsequent to invoicing. For multi-year agreements, we generally invoice customers annually at the beginning of each annual coverage period and recognize revenues over the term of the coverage period. Cost of Revenues, Excluding Depreciation and Amortization Cost of revenues consists of costs related to the production and servicing of the Company’s offerings. These costs primarily relate to information technology, production and maintenance of content and personnel costs relating to professional services and customer service. Selling, General and Administrative, Excluding Depreciation and Amortization Selling, general and administrative includes compensation for support and administrative functions in addition to rent, office expenses, professional fees and other miscellaneous expenses. In addition, it includes selling and marketing costs associated with acquiring new customers or selling new products or product renewals to existing customers. Such costs primarily relate to wages and commissions for sales and marketing personnel. Depreciation Depreciation expense relates to the Company’s fixed assets including furniture & fixtures, hardware, and leasehold improvements. These assets are depreciated over their expected useful lives, and in the case of leasehold improvements over the shorter of their useful life or the life of the related lease. Amortization Amortization expense relates to the Company’s finite-lived intangible assets including databases and content, customer relationships, and computer software. These assets are being amortized over periods of 2 to 20 years. Share-Based Compensation Share-based compensation expense includes cost associated with stock options granted to certain members of key management. The fair value of stock options is estimated at the date of grant using the Black-Scholes opt |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations | |
Business Combinations | Note 4: Business Combinations On October 25, 2018, Clarivate closed on the acquisition of TrademarkVision USA, LLC (“TrademarkVision”), an artificial intelligence technology start-up organization headquartered in Brisbane, Australia. The total purchase price for the acquisition consisted of $20,042 in closing date net cash consideration, subject to subsequent working capital adjustments, plus potential earn-out cash payments dependent upon achievement of certain milestones and financial performance metrics. The fair market value of the liability associated with the earn-out was $4,115 on the date of acquisition. Subsequent changes in the fair value will be included within the Consolidated Statement of Operations. Additionally, the excess value of the total purchase price over the estimated fair value of our identifiable assets and liabilities upon the closing of the acquisition of $19,205 was allocated to goodwill. The consolidated financial statements include the results of the acquisition subsequent to the closing date. TrademarkVision and its revolutionary image recognition software search tool for trademarks will join the trademark clearance and protection partner CompuMark. On March 15, 2018, the Company acquired all of the outstanding stock of Kopernio (“Kopernio”), an artificial-intelligence technology startup, for $3,497. The Kopernio acquisition was accounted for using the acquisition method of accounting. As a result of the Kopernio acquisition and the application of purchase accounting, Kopernio’s identifiable assets and liabilities were adjusted to their estimated fair market values as of the closing date, which included a finite life intangible of $1,258 relating to computer software. Additionally, the excess value of the total purchase price over the estimated fair value of our identifiable assets and liabilities upon the closing of the acquisition of $2,322 was allocated to goodwill. The consolidated financial statements include the results of the acquisition subsequent to the closing date. On June 1, 2017, the Company acquired all assets, liabilities and equity interests of Publons Limited and its wholly -owned subsidiary (“Publons”). Total net cash consideration for the acquisition was $7,401, plus potential future cash payments of up to $9,500 contingent upon Publons achieving certain milestones or financial and non-financial performance targets through 2020, including platform users and reviews. The fair market value of the liability associated with the earn-out was $5,900 on the date of acquisition. Subsequent changes in the fair value will be included within the Consolidated Statement of Operations. Publons is a researcher-facing peer-review data and recognition platform. The acquisition of Publons, its platform and data, is believed to increase the value of multiple existing Company products, while supporting researchers in the process. The consolidated financial statements include the results of the acquisitions subsequent to the closing date. The fair value of identifiable assets acquired and liabilities assumed for all acquisitions at closing during 2018 and 2017, respectively, which were adjusted for qualifying measurement period adjustments, net of cash acquired, and contingent consideration liabilities incurred in relation to the acquisitions are summarized below: 2018 2017 Other current assets $ 706 $ 51 Finite-lived intangible assets 7,928 3,600 Indefinite-lived intangible assets — 70 Goodwill 21,527 9,767 Other non-current assets 38 14 Total assets 30,199 13,502 Current liabilities 491 182 Non-current liabilities 2,054 19 Total liabilities 2,545 201 Net assets acquired $ 27,654 $ 13,301 None of the goodwill associated with any of the business combinations above will be deductible for income tax purposes. Pro forma information is not presented for these acquisitions as the aggregate operations of the acquisitions were not significant to the overall operations of the Company. |
The Transactions
The Transactions | 6 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | |
The Transactions | ||
The Transactions | Note 4: The Transactions On May 13, 2019, the Company completed the Transactions. Jersey began operations in 2016 as a provider of proprietary and comprehensive content, analytics, professional services and workflow solutions that enables users across government and academic institutions, life science companies and research and development (“R&D”) intensive corporations to discover, protect and commercialize their innovations. Churchill was a special purpose acquisition company whose business was to effect a merger, capital stock exchange, asset acquisition, stock purchase reorganization or similar business combination. The shares and earnings per share available to holders of the Company’s ordinary shares, prior to the Transactions, have been retroactively restated as shares reflecting the exchange ratio established in the Transactions (1.0 Jersey shares to 132.13667 Clarivate share). Pursuant to the Merger Agreement, the aggregate stock consideration issued by the Company in the Transactions was $3,052,500, consisting of 305,250,000 newly issued ordinary shares of the Company valued at $10.00 per share, subject to certain adjustments described below. Of the $3,052,500, the shareholders of Jersey prior to the closing of the Transactions (the “Company Owners”) received $2,175,000 in the form of 217,500,000 newly issued ordinary shares of the Company. In addition, of the $3,052,500, Churchill public shareholders received $690,000 in the form of 68,999,999 newly issued ordinary shares of the Company. In addition, Churchill Sponsor LLC (the “sponsor”) received $187,500 in the form of 17,250,000 ordinary shares of the Company issued to the sponsor, and 1,500,000 additional ordinary shares of the Company were issued to certain investors. See Note 11 — “Shareholders’ Equity” for further information. Upon consummation of the Transactions, each outstanding share of common stock of Churchill was converted into one ordinary share of the Company. At the closing of the Transactions, the Company Owners held approximately 74% of the issued and outstanding ordinary shares of the Company and stockholders of Churchill held approximately 26% of the issued and outstanding shares of the Company excluding the impact of (i) 52,800,000 warrants, (ii) approximately 24,806,793 compensatory options issued to the Company’s management (based on number of options to purchase Jersey ordinary shares outstanding immediately prior to the Transactions, after giving effect to the exchange ratio described above) and (iii) 10,600,000 ordinary shares of Clarivate owned of record by the sponsor and available for distribution to certain individuals following the applicable lock-up and vesting restrictions. After giving effect to the satisfaction of the vesting restrictions, the Company Owners held approximately 71% of the issued and outstanding shares of the Company at the close of the Transactions. See Note 11 — “Shareholders’ Equity” for further information on equity instruments. | Note 4: The Transactions On May 13, 2019, the Company completed the Transactions. Jersey began operations in 2016 as a provider of proprietary and comprehensive content, analytics, professional services and workflow solutions that enables users across government and academic institutions, life science companies and research and development (“R&D”) intensive corporations to discover, protect and commercialize their innovations. Churchill was a special purpose acquisition company whose business was to effect a merger, capital stock exchange, asset acquisition, stock purchase reorganization or similar business combination. The shares and earnings per share available to holders of the Company’s ordinary shares, prior to the Transactions, have been recasted as shares reflecting the exchange ratio established in the Transactions (1.0 Jersey shares to 132.13667 Clarivate share). Pursuant to the Merger Agreement, the aggregate stock consideration issued by the Company in the Transactions was $3,052,500, consisting of 305,250,000 newly issued ordinary shares of the Company valued at $10.00 per share, subject to certain adjustments described below. Of the $3,052,500, the shareholders of Jersey prior to the closing of the Transactions (the “Company Owners”) received $2,175,000 in the form of 217,500,000 newly issued ordinary shares of the Company. In addition, of the $3,052,500, Churchill public shareholders received $690,000 in the form of 68,999,999 newly issued ordinary shares of the Company. In addition, Churchill Sponsor LLC (the “sponsor”) received $187,500 in the form of 17,250,000 ordinary shares of the Company issued to the sponsor, and 1,500,000 additional ordinary shares of the Company were issued to certain investors. See Note 11 — “Shareholders’ Equity” for further information. Upon consummation of the Transactions, each outstanding share of common stock of Churchill was converted into one ordinary share of the Company. At the closing of the Transactions, the Company Owners held approximately 74% of the issued and outstanding ordinary shares of the Company and stockholders of Churchill held approximately 26% of the issued and outstanding shares of the Company excluding the impact of (i) 52,800,000 warrants, (ii) approximately 24,806,793 compensatory options issued to the Company’s management (based on number of options to purchase Jersey ordinary shares outstanding immediately prior to the Transactions, after giving effect to the exchange ratio described above) and (iii) 10,600,000 ordinary shares of Clarivate owned of record by the sponsor and available for distribution to certain individuals following the applicable lock-up and vesting restrictions. Certain restrictions were removed following the Secondary Offering on August 14, 2019. See Note 17 - "Employee Incentive Plans" for further information. After giving effect to the satisfaction of the vesting restrictions, the Company Owners held approximately 60% of the issued and outstanding shares of the Company at the close of the Transactions. See Note 11 — “Shareholders’ Equity” for further information on equity instruments. |
Divested Operations
Divested Operations | 12 Months Ended |
Dec. 31, 2018 | |
Divested Operations | |
Divested Operations | Note 5: Divested Operations Effective October 1, 2018, all assets, liabilities and equity interest of the IP Management (IPM) Product Line and related assets were sold to CPA Global for a total purchase price of $100,130. Proceeds received were inclusive of amounts subject to working capital adjustments of $6,135, which are recorded in Accrued expenses and other current liabilities on the Consolidated Balance Sheet. Net proceeds received excluded Cash and cash equivalents and Restricted cash of $25,382. The results of the IPM Product Line and related assets are included in the Consolidated Statement of Operations through September 30, 2018. As a result of the sale, the Company recorded a net gain on sale of $36,072, inclusive of incurred transaction costs of $3,032 in connection with the divestiture. The gain on sale is included in Other operating income (expense), net within the Consolidated Statement of Operations. As a result of the sale, the Company wrote off Goodwill in the amount of $49,349. The Company used $31,378 of the proceeds to pay down the Prior Term Loan Facility on October 31, 2018. See Note 12: Debt, for further details. The divestiture of the IPM Product Line and related assets does not represent a strategic shift that is expected to have a major effect on the Company’s operations or financial results, as defined by ASC 205‑20, Discontinued Operations ; as a result, the divestiture does not meet the criteria to be classified as discontinued operations. |
Leases
Leases | 6 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | |
Leases | ||
Leases | Note 5: Leases As the lessee, we currently lease real estate space, automobiles, and certain equipment under non-cancelable operating lease agreements. Some of the leases include options to extend the leases for up to an additional 10 years. We do not include any of our renewal options in our lease terms for calculating our lease liability as the renewal options allow us to maintain operational flexibility, and we are not reasonably certain we will exercise these renewal options at this time. We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use assets, Current portion of operating lease liabilities, and Operating lease liabilities on our interim condensed consolidated balance sheets. The Company assesses its ROU asset and other lease-related assets for impairment consistent with other long-lived assets. As of June 30, 2019, we did not record impairment related to these assets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. As such, the Company used judgment to determine an appropriate incremental borrowing rate. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our variable lease payments consist of non-lease services related to the lease and lease payments that are based on annual changes to an index. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are accounted as a single lease component. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. As of June 30, 2019, we have additional operating leases, primarily for real estate, that have not yet commenced of $1,713. These operating leases will commence between fiscal year 2019 and fiscal year 2020 with lease terms of one year to six years. Three Months Ended June 30, 2019 Lease cost Operating lease cost $ 7,080 Short-term lease cost 30 Variable lease cost 504 Total lease cost $ 7,614 Six Months Ended June 30, 2019 Lease cost Operating lease cost $ 14,302 Short-term lease cost 30 Variable lease cost 1,161 Total lease cost $ 15,493 Six Months Ended June 30, 2019 Other information Cash Paid for amounts included in measurement of lease liabilities Operating cash flows from operating leases $ 13,654 Weighted-average remaining lease term - operating leases 6 Weighed-average discount rate - operating leases 5.8 % The future aggregate minimum lease payments as of June 30, 2019 under all non-cancelable operating leases for the years noted are as follows: Year ending December 31, 2019 (excluding the six months ended June 30, 2019) $ 13,789 2020 21,510 2021 17,788 2022 15,198 2023 13,786 Thereafter 36,054 Total operating lease payments 118,125 Less imputed interest (20,974) Total $ 97,151 In connection with certain leases, the Company guarantees the restoration of the leased property to a specified condition after completion of the lease period. As of June 30, 2019 and December 31, 2018, the liability of $4,155 and $4,100, respectively, associated with these restorations is recorded within Other non-current liabilities. Disclosures related to periods prior to adoption of Topic 842 As discussed above, the Company adopted Topic 842 effective January 1, 2019 using a modified retrospective approach. For comparability purposes, and as required, the following disclosure is provided for periods prior to adoption. The Company’s total future minimum annual rental payments in effect at December 31, 2018 for noncancelable operating leases, which were accounted for under the previous leasing standard, Accounting Standards Codification 840, were as follows: Year ending December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 | Note 5: Leases As the lessee, we currently lease real estate space, automobiles, and certain equipment under non-cancelable operating lease agreements. Some of the leases include options to extend the leases for up to an additional 10 years. We do not include any of our renewal options in our lease terms for calculating our lease liability as the renewal options allow us to maintain operational flexibility, and we are not reasonably certain we will exercise these renewal options at this time. We determine if an arrangement is a lease at inception. Operating leases are included in Operating lease right-of-use assets, Current portion of operating lease liabilities, and Operating lease liabilities on our Interim Condensed Consolidated Balance Sheets. The Company assesses its ROU asset and other lease-related assets for impairment consistent with other long-lived assets. As of September 30, 2019, we did not record impairment related to these assets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. As such, the Company used judgment to determine an appropriate incremental borrowing rate. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our variable lease payments consist of non-lease services related to the lease and lease payments that are based on annual changes to an index. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are accounted as a single lease component. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. As of September 30, 2019, we have additional operating leases, primarily for real estate, that have not yet commenced of $5,840. These operating leases will commence between fiscal year 2019 and fiscal year 2020 with lease terms of one year to six years. Three Months Ended September 30, 2019 Lease cost Operating lease cost $ 6,755 Short-term lease cost 57 Variable lease cost 539 Total lease cost $ 7,351 Nine Months Ended September 30, 2019 Lease cost Operating lease cost $ 21,057 Short-term lease cost 87 Variable lease cost 1,700 Total lease cost $ 22,844 Nine Months Ended September 30, 2019 Other information Cash Paid for amounts included in measurement of lease liabilities Operating cash flows from operating leases $ 18,491 Weighted-average remaining lease term - operating leases 6 Weighted-average discount rate - operating leases 5.8 % The future aggregate minimum lease payments as of September 30, 2019 under all non-cancelable operating leases for the years noted are as follows: Year ending December 31, 2019 (excluding the nine months ended September 30, 2019) $ 6,912 2020 22,098 2021 18,041 2022 15,593 2023 14,099 2024 & Thereafter 35,824 Total operating lease payments 112,567 Less imputed interest (18,917) Total $ 93,650 In connection with certain leases, the Company guarantees the restoration of the leased property to a specified condition after completion of the lease period. As of September 30, 2019 and December 31, 2018, the liability of $4,097 and $4,100, respectively, associated with these restorations is recorded within Other non-current liabilities. Disclosures related to periods prior to adoption of Topic 842 As discussed above, the Company adopted Topic 842 effective January 1, 2019 using a modified retrospective approach. For comparability purposes, and as required, the following disclosure is provided for periods prior to adoption. The Company’s total future minimum annual rental payments in effect at December 31, 2018 for noncancelable operating leases, which were accounted for under the previous leasing standard, Accounting Standards Codification 840, were as follows: Year ending December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 |
Computer Hardware and Other Pro
Computer Hardware and Other Property, Net | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Computer Hardware and Other Property, Net. | |||
Computer Hardware and Other Property, Net | Note 6: Computer Hardware and Other Property, net Computer hardware and other property consisted of the following: June 30, 2019 December 31, 2018 Computer hardware $ 20,174 $ 18,130 Leasehold improvements 13,296 13,298 Furniture, fixtures and equipment 6,574 6,816 Total computer hardware and other property 40,044 38,244 Accumulated depreciation (21,554) (17,603) Total computer hardware and other property, net $ 18,490 $ 20,641 Depreciation expense amounted to $2,131 and $3,249 for the three months ended June 30, 2019 and 2018, respectively, and $4,182 and $4,650 for the six months ended June 30, 2019 and 2018, respectively. | Note 6: Computer Hardware and Other Property, net Computer hardware and other property consisted of the following: September 30, 2019 December 31, 2018 Computer hardware $ 22,095 $ 18,130 Leasehold improvements 13,965 13,298 Furniture, fixtures and equipment 6,326 6,816 Total computer hardware and other property 42,386 38,244 Accumulated depreciation (22,201) (17,603) Total computer hardware and other property, net $ 20,185 $ 20,641 Depreciation expense amounted to $2,281 and $3,291 for the three months ended September 30, 2019 and 2018, respectively, and $6,463 and $7,941 for the nine months ended September 30, 2019 and 2018, respectively. | Note 6: Computer Hardware and Other Property, Net Computer hardware and other property consisted of the following: December 31, 2018 2017 Computer hardware $ 18,130 $ 11,238 Leasehold improvements 13,298 13,885 Furniture, fixtures and equipment 6,816 6,768 Total computer hardware and other property 38,244 31,891 Accumulated depreciation (17,603) (8,881) Total computer hardware and other property, net $ 20,641 $ 23,010 Depreciation amounted to $9,422 for the year ended December 31, 2018. Depreciation amounted to $6,997 for the year ended December 31, 2017. |
Identifiable Intangible Assets,
Identifiable Intangible Assets, net | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Other Intangible Assets, net and Goodwill | |||
Identifiable Intangible Assets, net | Note 7: Other Intangible Assets, net and Goodwill Other Intangible Assets The following tables summarize the gross carrying amounts and accumulated amortization of the Company’s identifiable intangible assets by major class: June 30, 2019 December 31, 2018 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Finite-lived intangible assets Customer relationships $ 290,984 $ (184,761) $ 106,223 $ 291,503 $ (164,611) $ 126,892 Databases and content 1,724,802 (285,550) 1,439,252 1,725,878 (233,733) 1,492,145 Computer software 292,422 (121,699) 170,723 268,704 (97,570) 171,134 Finite-lived intangible assets 2,308,208 (592,010) 1,716,198 2,286,085 (495,914) 1,790,171 Indefinite-lived intangible assets Trade names 168,323 — 168,323 168,349 — 168,349 Total intangible assets $ 2,476,531 $ (592,010) $ 1,884,521 $ 2,454,434 $ (495,914) $ 1,958,520 Amortization expense amounted to $40,932 and $57,541 for the three months ended June 30, 2019, and 2018, respectively, and $97,038 and $114,672 for the six months ended June 30, 2019, and 2018, respectively. Goodwill The following table summarizes changes in the carrying amount of goodwill for the six months ended June 30, 2019: Total Balance as of December 31, 2018 $ 1,282,919 Changes due to foreign currency fluctuations (77) Balance as of June 30, 2019 $ 1,282,842 | Note 7: Other Intangible Assets, net and Goodwill Other Intangible Assets The following tables summarize the gross carrying amounts and accumulated amortization of the Company’s identifiable intangible assets by major class: September 30, 2019 December 31, 2018 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Finite-lived intangible assets Customer relationships $ 288,026 $ (184,626) $ 103,400 $ 291,503 $ (164,611) $ 126,892 Databases and content 1,721,623 (311,458) 1,410,165 1,725,878 (233,733) 1,492,145 Computer software 308,399 (133,931) 174,468 268,704 (97,570) 171,134 Finite-lived intangible assets 2,318,048 (630,015) 1,688,033 2,286,085 (495,914) 1,790,171 Indefinite-lived intangible assets Trade names 168,313 — 168,313 168,349 — 168,349 Total intangible assets $ 2,486,361 $ (630,015) $ 1,856,346 $ 2,454,434 $ (495,914) $ 1,958,520 Amortization expense amounted to $41,656 and $57,186 for the three months ended September 30, 2019, and 2018, respectively, and $138,694 and $171,858 for the nine months ended September 30, 2019, and 2018, respectively. In September 2019, Company purchased the key business assets of SequenceBase which was accounted for as an asset acquisition. As a result of the purchase, customer relations balance increased $1,000 and computer software increased $2,500. Goodwill The following table summarizes changes in the carrying amount of goodwill for the nine months ended September 30, 2019: Total Balance as of December 31, 2018 $ 1,282,919 Changes due to foreign currency fluctuations (1,415) Balance as of September 30, 2019 $ 1,281,504 | Note 7: Identifiable Intangible Assets, net The Company’s identifiable intangible assets consist of the following: December 31, 2018 December 31, 2017 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Finite-lived intangible assets Customer relationships $ 291,503 $ (164,611) $ 126,892 $ 299,886 $ (95,606) $ 204,280 Databases and content 1,725,878 (233,733) 1,492,145 1,733,304 (130,271) 1,603,033 Computer software 268,704 (97,570) 171,134 235,420 (52,696) 182,724 Finite-lived intangible assets 2,286,085 (495,914) 1,790,171 2,268,610 (278,573) 1,990,037 Indefinite-lived intangible assets Trade names 168,349 — 168,349 170,050 — 170,050 Total intangible assets $ 2,454,434 $ (495,914) $ 1,958,520 $ 2,438,660 $ (278,573) $ 2,160,087 The Company performed the indefinite-lived impairment test as of October 1, 2018. As part of this analysis, the Company determined that its trade name, with a carrying value of $168,349, and $170,050 as of December 31, 2018 and 2017, respectively, was not impaired and will continue to be reported as indefinite-lived intangible assets. The weighted-average amortization period for each class of finite-lived intangible assets and for total finite-lived intangible assets, which range between two and 20 years, is as follows: Remaining Weighted-Average Amortization Period (in years) Customer relationships 10.6 Databases and content 14.9 Computer software 4.9 Total 13.9 Amortization amounted to $227,803 for the year ended December 31, 2018. Amortization amounted to $221,466 for the year ended December 31, 2017. Estimated amortization for each of the five succeeding years as of December 31, 2018 is as follows: 2019 $ 176,545 2020 158,807 2021 149,326 2022 117,865 2023 113,545 Thereafter 1,036,411 Subtotal finite-lived intangible assets 1,752,499 Internally developed software projects in process 37,672 Total finite-lived intangible assets 1,790,171 Intangibles with indefinite lives 168,349 Total intangible assets $ 1,958,520 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill. | |
Goodwill | Note 8: Goodwill The change in the carrying amount of goodwill is shown below: Balance as of December 31, 2016 $ 1,305,571 Acquisition 9,767 Measurement period adjustments (4,175) Impact of foreign currency fluctuations and other 90 Balance as of December 31, 2017 $ 1,311,253 Acquisition 21,527 Disposals (49,349) Impact of foreign currency fluctuations and other (512) Balance as of December 31, 2018 $ 1,282,919 The Company performed the goodwill impairment test as of October 1, 2018 and 2017. Additionally, the Company reviewed goodwill for indicators of impairment at December 31, 2018 and 2017. Goodwill represents the purchase price in excess of the fair value of the net assets acquired in a business combination. If the carrying value of a reporting unit exceeds the implied fair value of that reporting unit, an impairment charge to goodwill is recognized for the excess. The Company’s reporting units are one level below the operating segment, as determined in accordance with ASC 350. For the years ended December 31, 2017 and 2018, the Company had one reporting unit and five reporting units, respectively. The number of reporting units increased during 2018 due to a change in the Company’s reporting structure resulting in five reporting units. The Company estimates the fair value of its reporting units using the income approach, which is a change from the previous year, which used a market approach. Under the income approach, the fair value of a reporting unit is calculated based on the present value of estimated cash flows. No indicators of impairment existed as a result of the Company’s assessments. However, based on the results of the 2018 annual impairment analysis performed, the Company has determined that the Derwent Product Line, previously known as the Intellectual Property & Standard (“IP&S”), reporting unit is at risk of a future goodwill impairment. The total goodwill associated with this reporting unit was approximately $130,381 as of December 31, 2018. Based on the latest annual impairment test, the estimated fair value of the Derwent Product Line reporting unit is approximately 2% above its carrying value. In connection with the 2016 Transaction, during the third quarter of 2017, the Company recorded measurement period adjustments due to additional analysis of facts and circumstances that existed after closing, which increased computer hardware and other property by $3,925, decreased accounts receivable by $614, decreased other current liabilities by $360, and decreased other non-current liabilities by $504. These adjustments resulted in a decrease to goodwill of $4,175. None of these measurement period adjustments had a material impact on the Company’s results of operations. Effective October 1, 2018, the Company divested the IPM Product Line, which included $49,349 of goodwill. See Note 5: Divested Operations for further details. |
Derivative Instruments
Derivative Instruments | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Derivative Instruments | |||
Derivative Instruments | Note 8: Derivative Instruments The IPM Product Line and related assets, which was divested on October 1, 2018, had forward contracts with notional values of $0 at June 30, 2019 and December 31, 2018. Gains or (losses) on the forward contracts amounted to $0 and $(993) for the three months ended June 30, 2019 and 2018, respectively. Gains or (losses) on the forward contracts amounted to $0 and $(1,052) for the six months ended June 30, 2019 and 2018, respectively. These amounts were recorded in Revenues, net in the interim condensed consolidated statements of operations. The cash flows from forward contracts are reported as operating activities in the Interim condensed consolidated statements of cash flows. The fair value of the forward contracts recorded in Accrued expenses and other current liabilities was $0 as at June 30, 2019 and December 31, 2018, respectively. Effective March 31, 2017, the Company entered into interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $300,000 of its outstanding Term Loan arrangements. Additionally, effective February 28, 2018, the Company entered into another interest rate swap relating to interest payments on $50,000 of its outstanding Term Loan arrangements. These hedging instruments mature on March 31, 2021. The Company applies hedge accounting by designating the interest rate swaps as a hedge on applicable future quarterly interest payments. In April 2019, the Company entered into additional interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $50,000 of its outstanding Term Loan, effective April 30, 2021. Additionally, in May 2019, the Company entered into additional interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $100,000 of its outstanding Term Loan, effective March 31, 2021. These hedging instruments mature on September 29, 2023. The Company will apply hedge accounting by designating the interest rate swaps as a hedge in applicable future quarterly interest payments. Changes in the fair value are recorded in Accumulated other comprehensive income (loss) (“AOCI”) and the amounts reclassified out of AOCI are recorded to Interest expense. The fair value of the interest rate swaps is recorded in Other non-current assets or liabilities according to the duration of related cash flows. The total fair value of the interest rate swaps was a liability of $2,147 at June 30, 2019 and an asset of $3,644 at December 31, 2018. See Note 9 — “Fair Value Measurements” for additional information on derivative instruments. The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and six months ended June 30, 2018: AOCI Balance at December 31, 2017 $ 1,107 Derivative gains (losses) recognized in Other comprehensive income (loss) 3,786 Amount reclassified out of Other comprehensive income (loss) to net loss (288) AOCI Balance at March 31, 2018 $ 4,605 Derivative gains (losses) recognized in Other comprehensive income (loss) 1,797 Amount reclassified out of Other comprehensive income (loss) to net loss (72) AOCI Balance at June 30, 2018 $ 6,330 The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and six months ended June 30, 2019: AOCI Balance at December 31, 2018 $ 3,644 Derivative gains (losses) recognized in Other comprehensive income (loss) (2,376) Amount reclassified out of Other comprehensive income (loss) to net loss 430 AOCI Balance at March 31, 2019 $ 1,698 Derivative gains (losses) recognized in Other comprehensive income (loss) (4,247) Amount reclassified out of Other comprehensive income (loss) to net loss 402 AOCI Balance at June 30, 2019 $ (2,147) | Note 8: Derivative Instruments The IPM Product Line and related assets, which was divested on October 1, 2018, had forward contracts with notional values of $0 at September 30, 2019 and December 31, 2018. Gains or (losses) on the forward contracts amounted to $0 and $812 for the three months ended September 30, 2019 and 2018, respectively. Gains or (losses) on the forward contracts amounted to $0 and $(240) for the nine months ended September 30, 2019 and 2018, respectively. These amounts were recorded in Revenues, net in the Interim Condensed Consolidated Statements of Operations. The cash flows from forward contracts are reported as operating activities in the Interim Condensed Consolidated Statements of Cash Flows. The fair value of the forward contracts recorded in Accrued expenses and other current liabilities was $0 as at September 30, 2019 and December 31, 2018. Effective March 31, 2017, the Company entered into interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $300,000 of its outstanding Term Loan arrangements. Additionally, effective February 28, 2018, the Company entered into another interest rate swap relating to interest payments on $50,000 of its outstanding Term Loan arrangements. These hedging instruments mature on March 31, 2021. The Company applies hedge accounting by designating the interest rate swaps as a hedge on applicable future quarterly interest payments. In April 2019, the Company entered into additional interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $50,000 of its outstanding Term Loan, effective April 30, 2021. Additionally, in May 2019, the Company entered into additional interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $100,000 of its outstanding Term Loan, effective March 31, 2021. These hedging instruments mature on September 29, 2023. The Company will apply hedge accounting by designating the interest rate swaps as a hedge in applicable future quarterly interest payments. Changes in the fair value are recorded in Accumulated other comprehensive income (loss) (“AOCI”) and the amounts reclassified out of AOCI are recorded to Interest expense, net. The fair value of the interest rate swaps is recorded in Other non-current assets or liabilities according to the duration of related cash flows. The total fair value of the interest rate swaps was a liability of $3,208 at September 30, 2019 and an asset of $3,644 at December 31, 2018. See Note 9 — “Fair Value Measurements” for additional information on derivative instruments. The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and nine months ended September 30, 2018: AOCI Balance at December 31, 2017 $ 1,107 Derivative gains (losses) recognized in Other comprehensive income (loss) 3,786 Amount reclassified out of Other comprehensive income (loss) to net loss (288) AOCI Balance at March 31, 2018 $ 4,605 Derivative gains (losses) recognized in Other comprehensive income (loss) 1,797 Amount reclassified out of Other comprehensive income (loss) to net loss (72) AOCI Balance at June 30, 2018 $ 6,330 Derivative gains (losses) recognized in Other comprehensive income (loss) 651 Amount reclassified out of Other comprehensive income (loss) to net loss 73 AOCI Balance at September 30, 2018 $ 7,054 The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and nine months ended September 30, 2019: AOCI Balance at December 31, 2018 $ 3,644 Derivative gains (losses) recognized in Other comprehensive income (loss) (2,376) Amount reclassified out of Other comprehensive income (loss) to net loss 430 AOCI Balance at March 31, 2019 $ 1,698 Derivative gains (losses) recognized in Other comprehensive income (loss) (4,247) Amount reclassified out of Other comprehensive income (loss) to net loss 402 AOCI Balance at June 30, 2019 $ (2,147) Derivative gains (losses) recognized in Other comprehensive income (loss) (1,271) Amount reclassified out of Other comprehensive income (loss) to net loss 210 AOCI Balance at September 30, 2019 $ (3,208) | Note 9: Derivative Instruments Prior to the sale of the IPM Product Line and related assets, the Company entered into forward contracts in order to mitigate exposure from changes in foreign currency exchange rates related to certain foreign denominated payables. We utilized derivative instruments to help us manage these risks. The maximum term of the forward contracts was six months with the majority of forward contracts having a term of one month. The Company recorded these forward contracts in either Accounts receivable or Accrued expenses and other current liabilities at fair value in the Consolidated Balance Sheets and recognized changes in the fair value of these forward contracts through earnings, as these instruments had not been designated as hedges. The IPM Product Line and related assets, which was divested on October 1, 2018, had forward contracts with notional values of $36,639 at December 31, 2017. Losses/(gains) on the forward contracts amounted to $240 and $(1,479) for the years ended December 31, 2018 and 2017, respectively, and were recorded in Revenues, net in the Consolidated Statements of Operations. The cash flows from forward contracts were reported as operating activities in the Consolidated Statements of Cash Flows. The fair value of the forward contracts was $83 at December 31, 2017. The fair value of the forward contracts was recorded in Other current assets in the Consolidated Balance Sheets. Effective March 31, 2017, the Company entered into interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $300,000 of its outstanding Term Loan arrangements. Additionally, effective February 28, 2018, the Company entered into another interest rate swap relating to interest payments on $50,000 of its outstanding Term Loan arrangements. These hedging instruments mature on March 31, 2021. The Company applies hedge accounting by designating the interest rate swaps as a hedge on applicable future quarterly interest payments. This interest rate swap was effective as of December 31, 2018 and 2017. The fair value of the interest rate swaps is recorded in Other long-term assets according to the duration of related cash flows. The total fair value of interest rate swap asset was $3,644 and $1,107 at December 31, 2018 and 2017, respectively. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Fair Value Measurements | |||
Fair Value Measurements | Note 9: Fair Value Measurements The Company records certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy that prioritizes the inputs used to measure fair value is described below. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: · Level 1 — Quoted prices in active markets for identical assets or liabilities. · Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. · Level 3 — Unobservable inputs that are support by little or no market activity. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. Below is a summary of the valuation techniques used in determining fair value: Derivatives — Derivatives consist of foreign exchange contracts and interest rate swaps. The fair value of foreign exchange contracts is based on observable market inputs of spot and forward rates or using other observable inputs. The fair value of the interest rate swaps is the estimated amount that the Company would receive or pay to terminate such agreements, taking into account market interest rates and the remaining time to maturities or using market inputs with mid-market pricing as a practical expedient for bid-ask spread. See Note 8 — “Derivative Instruments” for additional information. Contingent consideration — The Company values contingent consideration related to business combinations using a weighted probability calculation of potential payment scenarios discounted at rates reflective of the risks associated with the expected future cash flows. Key assumptions used to estimate the fair value of contingent consideration include revenues, net new business and operating forecasts and the probability of achieving the specific targets. The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and other accruals readily convertible into cash approximate fair value because of the short-term nature of the instruments. Additionally, the Company has a long-term indemnification asset from the Former Parent, the amount of which is equal to certain tax liabilities incurred prior to the Acquisition. The carrying amount approximates fair value because settlement is expected to be based on the underlying tax amount. Assets and Liabilities Recorded at Fair Value on a Recurring Basis The Company has determined that its forward contracts, included in Accrued expenses and other current liabilities, and interest rate swaps, included in Accumulated other comprehensive (loss) income and Other current assets and Other non-current assets according to the duration of related interest payments, reside within Level 2 of the fair value hierarchy. The earn-out liability is recorded in Accrued expenses and other current liabilities and Other non-current liabilities and is classified as Level 3 in the fair value hierarchy. Additionally, the earn-out relates to the TrademarkVision and the Publons acquisitions that occurred in 2018 and 2017, respectively. The amount payable is contingent upon the achievement of certain company specific milestones and performance metrics over a 1-year and 3-year period, respectively, including number of cumulative users, cumulative reviews and annual revenues. In accordance with ASC 805, we estimated the fair value of the earn-out using a Monte Carlo simulation. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in ASC 820. Significant changes in the key assumptions and inputs could result in a significant change in the fair value measurement of the earn-out. As of June 30, 2019, there were no significant changes in the range of outcomes for the earn out. There were no transfers of assets or liabilities between levels during the periods ended June 30, 2019 and December 31, 2018. The following table presents the changes in the earn-out, the only Level 3 item, for the three and six months ended June 30, 2019: December 31, 2018 7,075 Revaluations included in earnings 469 June 30, 2019 7,544 The following table provides a summary of the Company’s assets and liabilities that were recognized at fair value on a recurring basis as at June 30, 2019 and December 31, 2018: Total Fair Level 1 Level 2 Level 3 Value June 30, 2019 Liabilities Interest rate swap liability — 2,147 — 2,147 Earn-out liability — — 7,544 7,544 Total $ — $ 2,147 $ 7,544 $ 9,691 Total Fair Level 1 Level 2 Level 3 Value December 31, 2018 Assets Interest rate swap asset — 3,644 — 3,644 — $ 3,644 — $ 3,644 Liabilities Earn-out liability — — 7,075 7,075 Total $ — $ — $ 7,075 $ 7,075 Non-Financial Assets Valued on a Non-Recurring Basis The Company’s long-lived assets, including goodwill and finite-lived intangible assets subject to amortization, are measured at fair value on a non-recurring basis. These assets are measured at cost but are written-down to fair value, if necessary, as a result of impairment. There have been no impairments of the Company’s long-lived assets during any of the periods presented. | Note 9: Fair Value Measurements The Company records certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy that prioritizes the inputs used to measure fair value is described below. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: · Level 1 — Quoted prices in active markets for identical assets or liabilities. · Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. · Level 3 — Unobservable inputs that are support by little or no market activity. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. Below is a summary of the valuation techniques used in determining fair value: Derivatives — Derivatives consist of foreign exchange contracts and interest rate swaps. The fair value of foreign exchange contracts is based on observable market inputs of spot and forward rates or using other observable inputs. The fair value of the interest rate swaps is the estimated amount that the Company would receive or pay to terminate such agreements, taking into account market interest rates and the remaining time to maturities or using market inputs with mid-market pricing as a practical expedient for bid-ask spread. See Note 8—“Derivative Instruments” for additional information. Contingent consideration — The Company values contingent consideration related to business combinations using a weighted probability calculation of potential payment scenarios discounted at rates reflective of the risks associated with the expected future cash flows. Key assumptions used to estimate the fair value of contingent consideration include revenues, net new business and operating forecasts and the probability of achieving the specific targets. The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and other accruals readily convertible into cash approximate fair value because of the short-term nature of the instruments. Assets and Liabilities Recorded at Fair Value on a Recurring Basis The Company has determined that its forward contracts, included in Accrued expenses and other current liabilities, and interest rate swaps, included in Accumulated other comprehensive (loss) income and Other current assets and Other non-current assets according to the duration of related interest payments, reside within Level 2 of the fair value hierarchy. The earn-out liability is recorded in Accrued expenses and other current liabilities and Other non-current liabilities and is classified as Level 3 in the fair value hierarchy. Additionally, the earn-out relates to the TrademarkVision and the Publons acquisitions that occurred in 2018 and 2017, respectively. The amount payable is contingent upon the achievement of certain company specific milestones and performance metrics over a 1-year and 3-year period, respectively, including number of cumulative users, cumulative reviews and annual revenues. In accordance with ASC 805, we estimated the fair value of the earn-out using a Monte Carlo simulation. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in ASC 820. Significant changes in the key assumptions and inputs could result in a significant change in the fair value measurement of the earn-out. As of September 30, 2019, the Company increased the earn out liabilities related to Publons and TrademarkVision based on current period performance. Changes in the earn out are recorded to Transaction expenses in the Interim Condensed Consolidated Statement of Operations. There were no transfers of assets or liabilities between levels during the periods ended September 30, 2019 and December 31, 2018. The following table presents the changes in the earn-out, the only Level 3 item, for the three months ended September 30, 2019: June 30, 2019 $ 7,544 Revaluations included in earnings 4,616 September 30, 2019 $ 12,160 The following table presents the changes in the earn-out, the only Level 3 item, for the nine months ended September 30, 2019: December 31, 2018 $ 7,075 Revaluations included in earnings 5,085 September 30, 2019 $ 12,160 The following table provides a summary of the Company’s assets and liabilities that were recognized at fair value on a recurring basis as at September 30, 2019 and December 31, 2018: Total Fair Level 1 Level 2 Level 3 Value September 30, 2019 Liabilities Interest rate swap liability — 3,208 — 3,208 Earn-out liability — — 12,160 12,160 Total $ — $ 3,208 $ 12,160 $ 15,368 Total Fair Level 1 Level 2 Level 3 Value December 31, 2018 Assets Interest rate swap asset — 3,644 — 3,644 $ — $ 3,644 $ — $ 3,644 Liabilities Earn-out liability — — 7,075 7,075 Total $ — $ — $ 7,075 $ 7,075 Non-Financial Assets Valued on a Non-Recurring Basis The Company’s long-lived assets, including goodwill and finite-lived intangible assets subject to amortization, are measured at fair value on a non-recurring basis. These assets are measured at cost but are written-down to fair value, if necessary, as a result of impairment. There have been no impairments of the Company’s long-lived assets during any of the periods presented. | Note 10: Fair Value Measurements The Company records certain assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy that prioritizes the inputs used to measure fair value is described below. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: · Level 1 — Quoted prices in active markets for identical assets or liabilities. · Level 2 — Observable inputs other than quoted prices include in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. · Level 3 — Unobservable inputs that are support by little or no market activity. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. Below is a summary of the valuation techniques used in determining fair value: Derivatives — Derivatives consist of foreign exchange contracts and interest rate swaps. The fair value of foreign exchange contracts is based on observable market inputs of spot and forward rates or using other observable inputs. The fair value of the interest rate swaps is the estimated amount that the Company would receive or pay to terminate such agreements, taking into account market interest rates and the remaining time to maturities or using market inputs with mid-market pricing as a practical expedient for bid-ask spread. See Note 9 — Derivative Instruments for additional information. Contingent consideration — The Company values contingent consideration related to business combinations using a weighted probability calculation of potential payment scenarios discounted at rates reflective of the risks associated with the expected future cash flows. Key assumptions used to estimate the fair value of contingent consideration include revenues, net new business and operating forecasts and the probability of achieving the specific targets. See Note 4 — Business Combinations for additional information. The following inputs and assumptions were used to value the foreign exchange contract derivative liabilities outstanding during the years ended December 31, 2018 and 2017: December 31, 2018 2017 Discount Rate N/A 1.26 – 1.5% The carrying value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and other accruals readily convertible into cash approximate fair value because of the short-term nature of the instruments. Additionally, the Company has a long-term indemnification asset from the Former Parent, the amount of which is equal to certain tax liabilities incurred prior to the 2016 Transaction. The carrying amount approximates fair value because settlement is expected to be based on the underlying tax amount. The carrying value of the Company’s variable interest rate debt, excluding unamortized debt issuance costs and original issue discount, approximates fair value due to the short-term nature of the interest rate bench mark rates. The fair value of the fixed rate debt is estimated based on market observable data for debt with similar prepayment features. The fair value of the Company’s debt was $1,950,318 and $2,093,827 at December 31, 2018 and 2017, respectively. The fair value is considered Level 2 under the fair value hierarchy. Assets and Liabilities Recorded at Fair Value on a Recurring Basis The Company has determined that its forward contracts, included in Other current assets, along with the interest rate swaps, included in Accrued expenses and other current liabilities and Other non-current liabilities according to the duration of related cash flows, reside within Level 2 of the fair value hierarchy. The earn-out liability is recorded in Accrued expenses and other current liabilities and Other non-current liabilities and is classified as Level 3 in the fair value hierarchy. Additionally, the earn-out relates to the TrademarkVision and the Publons acquisitions that occurred in 2018 and 2017, respectively. The amount payable is contingent upon the achievement of certain company specific milestones and performance metrics over a 1‑year and 3‑year period, respectively, including number of cumulative users, cumulative reviews and annual revenues. In accordance with ASC 805, we estimated the fair value of the earn-out using a Monte Carlo simulation. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in ASC 820. Significant changes in the key assumptions and inputs could result in a significant change in the fair value measurement of the earn-out. As of December 31, 2018, there were no significant changes in the range of outcomes for the earn out. There were no transfers of assets or liabilities between levels during the years ended December 31, 2018 and 2017. The following inputs and assumptions were used to value the earn-out liability as of December 31, 2018: TrademarkVision Risk free rate Discount rate Expected life (in years) 1.54 Publons Risk free rate 2.34 – 2.63% Discount rate 9.23 – 9.72% Expected life (in years) 1.04 – 3.04 The following inputs and assumptions were used to value the earn-out liability as of December 31, 2017: Publons Risk free rate 1.17 – 1.62% Discount rate 11.44 – 11.90% Expected life (in years) 1.12 – 4.12 The following table presents the changes in the earn-out, the only Level 3 item, for the years ended December 31, 2018 and 2017. Balance as of December 31, 2016 $ — Earn-out liability 5,900 Balance at December 31, 2017 5,900 Business combinations 4,115 Payment of Earn-out liability(1) (2,470) Revaluations included in earnings (470) Balance as of December 31, 2018 $ 7,075 (1) See Note 19: Commitments and Contingencies for further details. The following table provides a summary of the Company’s assets and liabilities that were recognized at fair value on a recurring basis as at December 31, 2018 and 2017: December 31, 2018 Total Fair Level 1 Level 2 Level 3 Value Assets Interest rate swap asset $ — $ 3,644 $ — $ 3,644 — 3,644 — 3,644 Liabilities Earn-out — — 7,075 7,075 Total $ — $ — $ 7,075 $ 7,075 December 31, 2017 Total Fair Level 1 Level 2 Level 3 Value Assets Forward contracts asset $ — $ 83 $ — $ 83 Interest rate swap asset — 1,107 — 1,107 — 1,190 — 1,190 Liabilities Earn-out Liability — — 5,900 5,900 Total $ — $ — $ 5,900 $ 5,900 Non-Financial Assets Valued on a Non-Recurring Basis The Company’s long-lived assets, including goodwill and finite-lived intangible assets subject to amortization, are measured at fair value on a non-recurring basis. These assets are measured at cost but are written-down to fair value, if necessary, as a result of impairment. There have been no impairments of the Company’s long-lived assets during any of the periods presented. Finite-lived Intangible Assets — If a triggering event occurs, the Company determines the estimated fair value of finite-lived intangible assets by determining the present value of the expected cash flows. Indefinite-lived Intangible Asset — If a qualitative analysis indicates that it is more likely than not that the estimated fair value is less than the carrying value of an indefinite-lived intangible asset, the Company determines the estimated fair value of the indefinite-lived intangible asset (trade name) by determining the present value of the estimated royalty payments on an after-tax basis that it would be required to pay the owner for the right to use such trade name. If the carrying amount exceeds the estimated fair value, an impairment loss is recognized in an amount equal to the excess. |
Pension and Other Post-Retireme
Pension and Other Post-Retirement Benefits | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Pension and Other Post-Retirement Benefits | |||
Pension and Other Post-Retirement Benefits | Note 12: Pension and Other Post-Retirement Benefits The components of net periodic benefit cost changes in plan assets and benefit obligations recognized in other comprehensive loss were as follows: Three Months Ended June 30, 2019 2018 Service cost $ 220 $ 222 Interest cost 80 71 Expected return on plan assets (40) (37) Amortization of actuarial gains (20) (19) Net periodic benefit cost $ 240 $ 237 Six Month Ended June 30, 2019 2018 Service cost $ 441 $ 444 Interest cost 158 142 Expected return on plan assets (80) (75) Amortization of actuarial gains (38) (39) Net periodic benefit cost $ 481 $ 472 Interest cost and expected return on plan assets are recorded in interest expense on the accompanying Interim condensed consolidated statements of operations. | Note 12: Pension and Other Post-Retirement Benefits The components of net periodic benefit cost changes in plan assets and benefit obligations recognized in other comprehensive loss were as follows: Three Months Ended September 30, 2019 2018 Service cost $ 220 $ 222 Interest cost 80 71 Expected return on plan assets (40) (37) Amortization of actuarial gains (20) (19) Net periodic benefit cost $ 240 $ 237 Nine Months Ended September 30, 2019 2018 Service cost $ 662 $ 666 Interest cost 238 213 Expected return on plan assets (120) (112) Amortization of actuarial gains (49) (57) Net periodic benefit cost $ 731 $ 710 Interest cost and expected return on plan assets are recorded in Interest expense, net on the accompanying Interim Condensed Consolidated Statements of Operations. | Note 11: Pension and Other Post-Retirement Benefits Retirement Benefits Defined contribution plans Employees participate in various defined contribution savings plans that provide for Company-matching contributions. Costs for future employee benefits are accrued over the periods in which employees earn the benefits. Total expense related to defined contribution plans was $13,170 for the year ended December 31, 2018 and $12,488 for the year ended December 31, 2017, which approximates the cash outlays related to the plans. Defined benefit plans A limited number of employees participate in noncontributory defined benefit pension plans that are maintained in certain international markets. The plans are managed and funded to provide pension benefits to covered employees in accordance with local regulations and practices. The Company’s obligations related to the defined benefit pension plans is in Accrued expenses and other current liabilities and Other non-current liabilities. The following table presents the changes in projected benefit obligations, the plan assets, and the funded status of the defined benefit pension plans: December 31, 2018 2017 Obligation and funded status: Change in benefit obligation Projected benefit obligation at beginning of year $ 14,258 $ 13,621 Service costs 888 442 Interest cost 283 168 Plan participant contributions 109 — Actuarial (gain)/losses 29 (640) Divestiture (138) — Benefit payments (274) (123) Expenses paid from assets (35) — Effect of foreign currency translation (634) 790 Projected benefit obligation at end of year $ 14,486 $ 14,258 Change in plan assets Fair value of plan assets at beginning of year $ 5,062 $ 5,062 Actual return on plan assets 95 — Plan participant contributions 109 — Employer contributions 460 123 Benefit payments (274) (123) Expenses paid from assets (35) — Effect of foreign currency translation (233) — Fair value of plan assets at end of year 5,184 5,062 Unfunded status $ (9,302) $ (9,196) The following table summarizes the amounts recognized in the consolidated balance sheets related to the defined benefit pension plans: December 31, 2018 2017 Current liabilities $ (443) $ (342) Noncurrent liabilities $ (8,859) $ (8,854) AOCI $ (1,054) $ (1,252) The following table provides information for those pension plans with an accumulated benefit obligation in excess of plan assets and projected benefit obligations in excess of plan assets: December 31, 2018 2017 Plans with accumulated benefit obligation in excess of plan assets: Accumulated benefit obligation $ 13,605 $ 13,499 Fair value of plan assets $ 5,184 $ 5,062 Plans with projected benefit obligation in excess of plan assets: Projected benefit obligation $ 14,486 $ 14,258 Fair value of plan assets $ 5,184 $ 5,062 The components of net periodic benefit cost changes in plan assets and benefit obligations recognized in other comprehensive loss were as follows: December 31, 2018 2017 Service cost $ 888 $ 442 Interest cost 283 168 Expected return on plan assets (150) — Amortization of actuarial gains (78) (4) Net period benefit cost $ 943 $ 606 The following table presents the weighted-average assumptions used to determine the net periodic benefit cost as of: December 31, 2018 2017 Discount rate 2.31 % 2.38 % Expected return on plan assets 3.00 % — % Rate of compensation increase 3.76 % 4.56 % Social Security increase rate 2.50 % 2.50 % Pension increase rate 1.80 % 2.00 % The following table presents the weighted-average assumptions used to determine the benefit obligations as of: December 31, 2018 2017 Discount rate 2.26 % 2.31 % Rate of compensation increase 3.68 % 3.76 % Social Security increase rate 2.50 % 2.50 % Pension increase rate 1.80 % 1.80 % The Company determines the assumptions used to measure plan liabilities as of the December 31 measurement date. The discount rate represents the interest rate used to determine the present value of the future cash flows currently expected to be required to settle the Company’s defined benefit pension plan obligations. The discount rates are derived using weighted average yield curves on corporate bonds. The cash flows from the Company’s expected benefit obligation payments are then matched to the yield curve to derive the discount rates. At December 31, 2018, the discount rates ranged from 0.40% to 7.10% for the Company’s pension plan and postretirement benefit plan. At December 31, 2017, the discount rates ranged from 0.45% to 7.10% for the Company’s pension plan and postretirement benefit plan. Plan Assets The general investment objective for our plan assets is to obtain a rate of investment return consistent with the level of risk being taken and to earn performance rates of return as required by local regulations for our defined benefit plans. For such plans, the strategy is to invest primarily 100% in insurance contracts. Plan assets held in insurance contracts do not have target asset allocation ranges. The expected long-term return on plan assets is estimated based off of historical and expected returns. As of December 31, 2018, the expected weighted-average long-term rate of return on plan assets was 3%. The fair value of our plan assets and the respective level in the fair value hierarchy by asset category is as follows: December 31, 2018 December 31, 2017 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Fair value measurement of pension plan assets: Insurance contract $ — — 5,184 $ 5,184 $ — — 5,062 $ 5,062 The fair value of the insurance contracts is an estimate of the amount that would be received in an orderly sale to a market participant at the measurement date. The amount the plan would receive from the contract holder if the contracts were terminated is the primary input and is unobservable. The insurance contracts are therefore classified as Level 3 investments. The following table provides the estimated pension benefit payments that are payable from the plans to participants as of December 31, 2018 for the following years: 2019 $ 488 2020 610 2021 489 2022 643 2023 781 2024 to 2027 4,923 Total $ 7,934 Based on the current status of our defined benefit obligations, we expect to make payments in the amount of $274 to fund these plans in 2019. However, this estimate may change based on future regulatory changes. |
Debt
Debt | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Debt | |||
Debt | Note 10: Debt The following is a summary of the Company’s debt: June 30, 2019 December 31, 2018 Interest Carrying Interest Carrying Type Maturity Rate Value Rate Value Senior Unsecured Notes 2024 7.875 % $ 500,000 7.875 % $ 500,000 Term Loan Facility 2023 5.652 % 846,320 5.729 % 1,483,993 Revolving Credit Facility 2021 — % — 5.754 % 5,000 Revolving Credit Facility 2021 — % — 5.729 % 40,000 Total debt outstanding 1,346,320 2,028,993 Deferred financing charges (21,201) (34,838) Term Loan Facility, discount (1,855) (3,633) Current Portion of Long-Term Debt (15,345) (60,345) Long-term debt, net of current portion and deferred financing charges $ 1,307,919 $ 1,930,177 Upon the close of the Transactions, the Company made a voluntary prepayment of $630,000 toward the Company’s Term Loan Facility and $20,000 toward the Company’s Revolving Credit Facility. In addition, the Company wrote down deferred financing charges and original issuance discount on the Term Loan in proportion to the principal paydown. These write-downs of $7,718 in deferred financing fees and $1,406 in original issues discount, were included in Interest expense within the statement of operations. During the six months ended June 30, 2019, the Company paid down an additional $30,000 drawn on the Revolving Credit Facility prior to the close of the Transaction. With respect to the Credit Agreement, the Company may be subject to certain negative covenants, including compliance with total first lien net leverage ratio, if certain conditions are met. These conditions were not met and the Company was not required to test compliance with these covenants as of June 30, 2019. The obligations of the Borrowers under the Credit Agreement are guaranteed by UK Holdco and certain of its restricted subsidiaries and are secured by substantially all of UK Holdco’s and certain of its restricted subsidiaries’ assets (with customary exceptions described in the Credit Agreement). UK Holdco and its restricted subsidiaries are subject to certain covenants including restrictions on UK Holdco’s ability to pay dividends, incur indebtedness, grant a lien over its assets, merge or consolidate, make investments, or make payments to affiliates. As of June 30, 2019, letters of credit totaling $1,985 were collateralized by the Revolving Credit Facility. Notwithstanding the Revolving Credit Facility, as of June 30, 2019, the Company had an unsecured corporate guarantee outstanding for $9,639 and cash collateralized letters of credit totaling $38, all of which were not collateralized by the Revolving Credit Facility. The Company’s cash from operations is expected to meet repayment needs on outstanding borrowings for a period of 12 months after the financial statement issuance date. The carrying value of the Company’s variable interest rate debt, excluding unamortized debt issuance costs, approximates fair value due to the short-term nature of the interest rate bench mark rates. The fair value of the fixed rate debt is estimated based on market observable data for debt with similar prepayment features. The fair value of the Company’s debt was $1,373,945 and $1,950,318 at June 30, 2019 and December 31, 2018, respectively. The debt is considered a Level 2 liability under the fair value hierarchy. | Note 10: Debt The following is a summary of the Company’s debt: September 30, 2019 December 31, 2018 Interest Carrying Interest Carrying Type Maturity Rate Value Rate Value Senior Unsecured Notes 2024 7.875 % $ 500,000 7.875 % $ 500,000 Term Loan Facility 2023 5.294 % 842,484 5.729 % 1,483,993 Revolving Credit Facility 2021 — % — 5.754 % 5,000 Revolving Credit Facility 2021 — % — 5.729 % 40,000 Total debt outstanding 1,342,484 2,028,993 Deferred financing charges (20,038) (34,838) Term Loan Facility, discount (1,737) (3,633) Current Portion of Long-Term Debt (15,345) (60,345) Long-term debt, net of current portion and deferred financing charges $ 1,305,364 $ 1,930,177 Upon the close of the Transactions, the Company made a voluntary prepayment of $630,000 toward the Company’s Term Loan Facility and $20,000 toward the Company’s Revolving Credit Facility. In addition, the Company wrote down deferred financing charges and original issuance discount on the Term Loan in proportion to the principal paydown. These write-downs of $7,718 in deferred financing fees and $1,406 in original issues discount, were included in Interest expense, net within the statement of operations in the second quarter of 2019. During the nine months ended September 30, 2019, the Company paid down an additional $30,000 drawn on the Revolving Credit Facility prior to the close of the Transaction. With respect to the Credit Agreement, the Company may be subject to certain negative covenants, including compliance with total first lien net leverage ratio, if certain conditions are met. These conditions were not met and the Company was not required to test compliance with these covenants as of September 30, 2019. The obligations of the Borrowers under the Credit Agreement are guaranteed by UK Holdco and certain of its restricted subsidiaries and are secured by substantially all of UK Holdco’s and certain of its restricted subsidiaries’ assets (with customary exceptions described in the Credit Agreement). UK Holdco and its restricted subsidiaries are subject to certain covenants including restrictions on UK Holdco’s ability to pay dividends, incur indebtedness, grant a lien over its assets, merge or consolidate, make investments, or make payments to affiliates. As of September 30, 2019, letters of credit totaling $1,935 were collateralized by the Revolving Credit Facility. Notwithstanding the Revolving Credit Facility, as of September 30, 2019, the Company had an unsecured corporate guarantee outstanding for $9,639 and cash collateralized letters of credit totaling $36, all of which were not collateralized by the Revolving Credit Facility. The Company’s cash from operations is expected to meet repayment needs on outstanding borrowings for a period of 12 months after the financial statement issuance date. The carrying value of the Company’s variable interest rate debt, excluding unamortized debt issuance costs, approximates fair value due to the short-term nature of the interest rate bench mark rates. The fair value of the fixed rate debt is estimated based on market observable data for debt with similar prepayment features. The fair value of the Company’s debt was $1,368,718 and $1,950,318 at September 30, 2019 and December 31, 2018, respectively. The debt is considered a Level 2 liability under the fair value hierarchy. | Note 12: Debt The following is a summary of the Company’s debt: December 31, 2018 December 31, 2017 Effective Effective Interest Carrying Interest Carrying Type Maturity Rate Value Rate Value Senior Unsecured Prior Notes 2024 7.875 % $ 500,000 7.875 % $ 500,000 Prior Term Loan Facility 2023 5.729 % 1,483,993 4.700 % 1,530,700 The Prior Revolving Credit Facility 2021 5.754 % 5,000 — % — The Prior Revolving Credit Facility 2021 5.729 % 40,000 4.751 % 30,000 Total debt outstanding 2,028,993 2,060,700 Debt issuance costs (34,838) (43,086) Prior Term Loan Facility, discount (3,633) (4,534) Short-term debt, including current portion of long-term debt (60,345) (45,345) Long-term debt, net of current portion and debt issuance costs $ 1,930,177 $ 1,967,735 The loans were priced at market terms and collectively have a weighted average interest rate and term of 6.259% and 5.473% for the year ended December 31, 2018 and 2017, respectively. Senior Unsecured Prior Notes On October 3, 2016, in connection with the 2016 Transaction, Camelot Finance S.A., a wholly-owned subsidiary of the Company, issued senior unsecured notes (“Prior Notes”) in an aggregate principal amount of $500,000. The Prior Notes bear interest at a rate of 7.875% per annum, payable semi-annually to holders of record in April and October and mature in October 2024. The first interest payment was made April 2017. The Prior Notes include customary covenants, including covenants that restrict, subject to certain exceptions, Bidco’s, and certain of its subsidiaries’, ability to incur indebtedness, issue certain types of stock, incur liens, make certain investments, dispose of assets, make certain types of restricted payments, consolidate or merge with certain entities or enter into certain related party transactions. The Prior Notes are subject to redemption as a result of certain changes in tax laws or treaties of (or their interpretation by) a relevant taxing jurisdiction at 100% of the principal amount, plus accrued and unpaid interest to the date of redemption, and upon certain changes in control at 101% of the principal amount, plus accrued and unpaid interest to the date of purchase. Additionally, at the Company’s election the Prior Notes may be redeemed (i) prior to October 15, 2019 at a redemption price equal to 100% of the aggregate principal amount of Prior Notes being redeemed plus a “make-whole” premium, plus accrued and unpaid interest to the date of redemption or (ii) on October 15 of each of the years referenced below based on the call premiums listed below, plus accrued and unpaid interest to the date of redemption. Redemption Price Period (as a percentage of principal) 2019 103.938 % 2020 101.969 % 2021 and thereafter 100.000 % Senior Secured Credit Facility The Company’s credit agreement, dated as of October 3, 2016 (“Prior Credit Agreement”), initially consisted of a $1,550,000 Prior Term Loan Facility and a $175,000 first lien senior secured revolving credit facility in an aggregate principal amount of $175,000, with a letter of credit sub limit of $25,000 (“Prior Revolving Credit Facility”). The Prior Revolving Credit Facility carries an interest rate at LIBOR plus 3.25% per annum or Prime plus a margin of 2.25% per annum, as applicable depending on the borrowing, and matures on October 3, 2021. The Prior Revolving Credit Facility interest rate margins will decrease upon the achievement of certain first lien net leverage ratios (as the term is used in the Prior Credit Agreement). The Prior Term Loan Facility consisted of a $651,000 borrowing by Camelot Finance LP, a subsidiary of Onex Corporation, and an $899,000 borrowing by Camelot Cayman LP, a subsidiary of Onex Corporation (collectively “Tower Borrowers”). The proceeds of the loans to Tower Borrowers were, in turn, loaned to the Company in loans with identical principal amounts and substantially similar repayment terms. In addition to the interest rates above the Company pays 0.1% interest to the Tower Borrowers. Camelot Finance LP was dissolved on December 31, 2017, at which time Credit Suisse AG, Cayman Islands Branch, acting as the administrative agent for the respective portion of the Prior Term Loan Facility, became the direct lender to the Company. The Prior Term Loan Facility matures on October 3, 2023. Principal repayments under the Prior Term Loan Facility are due quarterly in an amount equal to 0.25% of the aggregate outstanding principal amount borrowed under the Prior Term Loan Facility on October 3, 2016 and on the maturity date, in an amount equal to the aggregate outstanding principal amount on such date, together in each case, with accrued and unpaid interest. In connection with the Prior Term Loan Facility, the Company incurred $64,888 of debt issuance costs. On April 6, 2017, and November 16, 2017, the Borrowers and the other loan parties entered into Amendments (the “Amendments”) to the Prior Credit Agreement in order to (i) reduce the margins under the existing senior secured U.S. dollar-denominated Prior Term Loan Facility to LIBOR plus 3.50%, and 3.25%, respectively, per annum (with a 1.00% LIBOR floor) or Prime plus 2.25% per annum, as applicable, and (ii) reset the prepayment premium of 101% on certain prepayments and amendments of the Prior Term Loan Facility in connection with re-pricing events (“Amended Prior Term Loan Facility”). In addition, the Company pays 0.1% interest to the Tower Borrowers. Effective December 31, 2017, the Company no longer pays interest to Camelot Finance LP. The Amended Prior Term Loan Facility was $1,534,539. As a result of the Amendments, debt issuance costs and debt discounts of $13,892, which had been capitalized in connection with the original Prior Term Loan Facility issued on October 3, 2016, were written off to Interest expense, net in the Consolidated Statements of Operations as extinguishment charges for the year ended December 31, 2017. The Amendments also provided for a 0.25% step-down in margin once UK Holdco achieves a B2 corporate family rating from Moody’s. Except as noted above, all other terms of the Amended Prior Term Loan Facility are substantially similar to terms of the Company’s existing Prior Term Loan Facility. Upon sale of the IPM Product Line and related assets, the Company made an excess cash payment of $31,378 toward the Company’s Prior Term Loan Facility in accordance with the Credit Facility. The Prior Revolving Credit Facility provides for revolving loans, same-day borrowings and letters of credit pursuant to commitments in an aggregate principal amount of $175,000 with a letter of credit sublimit of $25,000. Proceeds of loans made under the Prior Revolving Credit Facility may be borrowed, repaid and reborrowed prior to the maturity of the Prior Revolving Credit Facility. Our ability to draw under the Prior Revolving Credit Facility or issue letters of credit thereunder will be conditioned upon, among other things, delivery of required notices, accuracy of the representations and warranties contained in the Prior Credit Agreement and the absence of any default or event of default under the Prior Credit Agreement. With respect to the Amendments, the Company may be subject to certain negative covenants, including either a fixed charge coverage ratio, total first lien net leverage ratio, or total net leverage ratio if certain conditions are met. These conditions were not met and the Company was not required to perform these covenants as of December 31, 2018. The obligations of the borrowers under the Prior Credit Agreement are guaranteed by UK Holdco and certain of its restricted subsidiaries and are collateralized by substantially all of UK Holdco’s and certain of its restricted subsidiaries’ assets (with customary exceptions described in the Prior Credit Agreement). UK Holdco and its restricted subsidiaries are subject to certain covenants including restrictions on UK Holdco’s ability to pay dividends, incur indebtedness, grant a lien over its assets, merge or consolidate, make investments, or make payments to affiliates. As of December 31, 2018, letters of credit totaling $2,002 were collateralized by the Prior Revolving Credit Facility. Notwithstanding the Prior Revolving Credit Facility, as of December 31, 2018 the Company had an unsecured corporate guarantee outstanding for $9,639 and cash collateralized letters of credit totaling $38, all of which were not collateralized by the Prior Revolving Credit Facility. The Company borrowed $45,000 and $30,000 against the Prior Revolving Credit Facility as of December 31, 2018 and 2017, respectively, to support current operations. The Company’s cash from operations is expected to meet repayment needs for the next twelve months. Amounts due under all of the outstanding borrowings as of December 31, 2018 for the next five years are as follows: 2019 $ 60,345 2020 15,345 2021 15,345 2022 15,345 2023 1,422,613 Thereafter 500,000 Total maturities 2,028,993 Less: capitalized debt issuance costs and original issue discount (38,471) Total debt outstanding as of December 31, 2018 $ 1,990,522 |
Revenue
Revenue | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Revenue Recognition | |||
Revenue | Note 13: Revenue Recognition The tables below show the Company’s disaggregated revenues for the periods presented: Three Months Ended June 30, 2019 2018 Subscription revenues $ 202,747 $ 199,481 Transactional revenues 39,693 44,729 Total revenues, gross 242,440 244,210 Deferred revenues adjustment (1) (131) (913) Total Revenues, net $ 242,309 $ 243,297 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. Six Months Ended June 30, 2019 2018 Subscription revenues $ 395,239 $ 392,106 Transactional revenues 81,390 90,598 Total revenues, gross 476,629 482,704 Deferred revenues adjustment (1) (295) (2,380) Total Revenues, net $ 476,334 $ 480,324 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. Contract Balances Current portion Non-current Accounts of deferred portion of receivables revenues deferred revenues Opening (1/1/2019) $ 331,295 $ 391,102 $ 17,112 Closing (6/30/2019) 270,584 404,753 22,236 (Increase)/decrease $ 60,711 $ (13,651) $ (5,124) Opening (1/1/2018) $ 317,808 $ 361,260 $ 15,796 Closing (12/31/2018) 331,295 391,102 17,112 Increase $ (13,487) $ (29,842) $ (1,316) The amount of revenue recognized in the period that were included in the opening deferred revenues current and long-term balances were $163,607. This revenue consists primarily of subscription revenue. Transaction Price Allocated to the Remaining Performance Obligation As of June 30, 2019, approximately $66,211 of revenue is expected to be recognized in the future from remaining performance obligations, excluding contracts with durations of one year or less. The Company expects to recognize revenue on approximately 64% of these performance obligations over the next 12 months. Of the remaining 36%, 23% is expected to be recognized within the following year, with the final 13% expected to be recognized within years 3 to 10. | Note 13: Revenue Recognition The tables below show the Company’s disaggregated revenues for the periods presented: Three Months Ended September 30, 2019 2018 Subscription revenues $ 200,813 $ 204,305 Transactional revenues 42,252 39,117 Total revenues, gross 243,065 243,422 Deferred revenues adjustment (1) (67) (525) Total Revenues, net $ 242,998 $ 242,897 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. Nine Months Ended September 30, 2019 2018 Subscription revenues $ 596,052 $ 596,411 Transaction revenues 123,642 129,715 Total revenues, gross 719,694 726,126 Deferred revenues adjustment (1) (362) (2,905) Total Revenues, net $ 719,332 $ 723,221 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. Contract Balances Current portion Non-current Accounts of deferred portion of receivable revenues deferred revenues Opening (1/1/2019) $ 331,295 $ 391,102 $ 17,112 Closing (9/30/2019) 226,997 330,786 21,299 (Increase)/decrease $ 104,298 $ 60,316 $ (4,187) Opening (1/1/2018) $ 317,808 $ 361,260 $ 15,796 Closing (12/31/2018) 331,295 391,102 17,112 (Increase) $ (13,487) $ (29,842) $ (1,316) The amount of revenue recognized in the period that were included in the opening deferred revenues current and long-term balances were $210,784. This revenue consists primarily of subscription revenue. Transaction Price Allocated to the Remaining Performance Obligation As of September 30, 2019, approximately $66,723 of revenue is expected to be recognized in the future from remaining performance obligations, excluding contracts with durations of one year or less. The Company expects to recognize revenue on approximately 67% of these performance obligations over the next 12 months. Of the remaining 33%, 21% is expected to be recognized within the following year, with the final 12% expected to be recognized within years 3 to 10. | Note 13: Revenue Disaggregated Revenues The tables below show the Company’s disaggregated revenues for the periods presented: Years Ended December 31, 2018 2017 Subscription revenues $ 794,097 $ 785,717 Transaction revenues 177,523 181,590 Total revenues, gross 971,620 967,307 Deferred revenues adjustment(1) (3,152) (49,673) Total Revenues, net $ 968,468 $ 917,634 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. Cost to Obtain a Contract The Company has prepaid sales commissions included in both Prepaid expenses and Other non-current assets on the balance sheets. The amount of prepaid sales commissions included in Prepaid expenses was $10,407 and $8,285 as of December 31, 2018 and 2017, respectively. The amount of prepaid sales commissions included in Other non-current assets was $9,493 and $5,457 as of December 31, 2018 and 2017, respectively. Amortization expense of the commission balances amounted to $9,995 and $4,335 for the years ended December 31, 2018 and 2017, respectively. The Company has not recorded any impairments against these prepaid sales commissions. Contract Balances Current portion Non-current Accounts of deferred portion of receivables revenues deferred revenues Opening (1/1/2018) $ 317,808 $ 361,260 $ 15,796 Closing (12/31/2018) 331,295 391,102 17,112 (Increase)/decrease $ (13,487) $ (29,842) $ (1,316) Opening (1/1/2017) $ 361,586 $ 333,944 $ 18,602 Closing (12/31/2017) 317,808 361,260 15,796 (Increase)/decrease $ 43,778 $ (27,316) $ 2,806 The amount of revenues recognized in the period that were included in the opening deferred revenues current and long-term balances were $361,260. This revenue consists primarily of subscription revenue. Transaction Price Allocated to the Remaining Performance Obligation As of December 31, 2018, approximately $68,394 of revenue is expected to be recognized in the future from remaining performance obligations, excluding contracts with durations of one year or less. The Company expects to recognize revenue on approximately 63% of these performance obligations over the next 12 months. Of the remaining 37%, 21% is expected to be recognized within the following year, with the final 16% expected to be recognized within years 3 to 9. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Shareholders' Equity | |||
Shareholders' Equity | Note 11: Shareholders’ Equity Jersey In March 2017, the Company formed the Management Incentive Plan under which certain employees of the Company may be eligible to purchase shares of the Company. In exchange for each share subscription purchased, the purchaser is entitled to a fully vested right to an ordinary share. Additionally, along with a subscription, employees receive a corresponding number of options to acquire additional ordinary shares subject to five year vesting. See Note 17 — “Employee Incentive Plans” for additional detail related to the options. The Company received net subscriptions for 46,247 and 174,420 shares, retroactively restated for the effect of the reverse recapitalization, during the three and six months ended June 30, 2018, respectively. There were no share subscriptions received prior to the close of the Transactions in 2019. Post-Transactions Immediately prior to the closing of the Transactions, there were 87,749,999 shares of Churchill common stock issued and outstanding, consisting of (i) 68,999,999 public shares (Class A) and (ii) 18,750,000 founder shares (Class B). On May 13, 2019, in connection with the Transactions, all of the Class B common stock converted into Class A common stock of the post-combination company on a one-for-one basis, and effect the reclassification and conversion of all of the Class A common stock and Class B common stock into a single class of common stock of Clarivate Analytics PLC. One stockholder elected to have one share redeemed in connection with the Transactions. In June 2019, the Company formed the 2019 Incentive Award Plan under which employees of the Company may be eligible to purchase shares of the Company. See Note 17 — “Employee Incentive Plans” for additional detail related to the 2019 Incentive Award Plan. In exchange for each share subscription purchased, the purchaser is entitled to a fully vested right to an ordinary share. At June 30, 2019, there were unlimited shares of common stock authorized, and 305,268,497 shares issued and outstanding, with a par value of $0.00. The Company did not hold any shares as treasury shares as of June 30, 2019 or December 31, 2018. The Company’s common stockholders are entitled to one vote per share. Warrants Upon consummation of the Transactions, the Company has warrants outstanding to purchase an aggregate of 52,800,000 ordinary shares. Each outstanding whole warrant of Churchill represents the right to purchase one ordinary share of the Company in lieu of one share of Churchill common stock upon closing of the Transactions at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing upon the later of (i) 30 days after the completion of the Transactions and (ii) September 11, 2019. Additionally, the Warrants are not exercisable and the Company shall not be obligated to issue shares of common stock upon exercise of the Warrants unless the shares of common stock issuable upon such Warrant exercise have been registered, qualified or deemed to be exempt under the applicable securities laws. Lastly, the holder does not have the right to exercise the Warrants to the extent that they would beneficially own in excess of 4.9% or 9.8% (as specified by the holder) of the shares of common stock outstanding immediately after giving effect to such exercise. Incentive Shares Upon consummation of the Transactions, there were 7,000,000 ordinary shares of Clarivate that are issuable to persons designated in the Sponsor Agreement if the last sale price of Clarivate’s ordinary shares is at least $20.00 for 40 days over a 60 consecutive trading day period on or before the sixth anniversary of the closing of the Transactions. | Note 11: Shareholders’ Equity Jersey In March 2017, the Company formed the Management Incentive Plan under which certain employees of the Company may be eligible to purchase shares of the Company. In exchange for each share subscription purchased, the purchaser is entitled to a fully vested right to an ordinary share. Additionally, along with a subscription, employees receive a corresponding number of options to acquire additional ordinary shares subject to five year vesting. See Note 17 — “Employee Incentive Plans” for additional detail related to the options. The Company received net subscriptions for 13,347 and 187,766 shares, retroactively restated for the effect of the reverse recapitalization, during the three and nine months ended September 30, 2018, respectively. There were no share subscriptions received prior to the close of the Transactions in 2019. Post-Transactions Immediately prior to the closing of the Transactions, there were 87,749,999 shares of Churchill common stock issued and outstanding, consisting of (i) 68,999,999 public shares (Class A) and (ii) 18,750,000 founder shares (Class B). On May 13, 2019, in connection with the Transactions, all of the Class B common stock converted into Class A common stock of the post-combination company on a one-for-one basis, and effect the reclassification and conversion of all of the Class A common stock and Class B common stock into a single class of common stock of Clarivate Analytics PLC. One stockholder elected to have one share redeemed in connection with the Transactions. In June 2019, the Company formed the 2019 Incentive Award Plan under which employees of the Company may be eligible to purchase shares of the Company. See Note 17 — “Employee Incentive Plans” for additional detail related to the 2019 Incentive Award Plan. In exchange for each share subscription purchased, the purchaser is entitled to a fully vested right to an ordinary share. At September 30, 2019 there were unlimited shares of common stock authorized, and 306,050,763 shares issued and outstanding, with a par value of $0.00. The Company did not hold any shares as treasury shares as of September 30, 2019 or December 31, 2018. The Company’s common stockholders are entitled to one vote per share. Warrants Upon consummation of the Transactions, the Company has warrants outstanding to purchase an aggregate of 52,800,000 ordinary shares. Each outstanding whole warrant of Churchill represents the right to purchase one ordinary share of the Company in lieu of one share of Churchill common stock upon closing of the Transactions at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing upon the later of (i) 30 days after the completion of the Transactions and (ii) September 11, 2019. As of September 30, 2019, no warrants had been exercised. Additionally, the Warrants are not exercisable and the Company shall not be obligated to issue shares of common stock upon exercise of the Warrants unless the shares of common stock issuable upon such Warrant exercise have been registered, qualified or deemed to be exempt under the applicable securities laws. Lastly, the holder does not have the right to exercise the Warrants to the extent that they would beneficially own in excess of 4.9% or 9.8% (as specified by the holder) of the shares of common stock outstanding immediately after giving effect to such exercise. Incentive Shares Upon consummation of the Transactions, there were 7,000,000 ordinary shares of Clarivate that are issuable to persons designated in the Sponsor Agreement if the last sale price of Clarivate’s ordinary shares is at least $20.00 for 40 days over a 60 consecutive trading day period on or before the sixth anniversary of the closing of the Transactions. | Note 14: Shareholders’ Equity Shareholders’ Equity In March 2017, the Company formed the Management Incentive Plan under which certain employees of the Company may be eligible to purchase shares of the Company. In exchange for each share purchase subscription, the purchaser is entitled to a fully vested right to an ordinary share. Additionally, along with a subscription, employees receive a corresponding number of options to acquire additional ordinary shares subject to five year vesting. See “Note 15 — Employment and Compensation Arrangements” for additional detail related to the options. The Company has received net subscriptions for 198,602 and 1,218,300 shares during the years ended December 31, 2018 and 2017, respectively. Additionally, the Company granted 66,068 ordinary shares in exchange for services provided during the year ended December 31, 2017. At December 31, 2018, the number of shares issued and outstanding under the Management Incentive Plan was 1,482,969. |
Employment and Compensation Arr
Employment and Compensation Arrangements | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Employee Incentive Plans | |||
Employment and Compensation Arrangements | Note 17:Employee Incentive Plans Prior to the Transactions, the Company operated under its 2016 Equity Incentive Plan, which provided for certain employees of the Company to be eligible to participate in equity ownership in the Company. On May 8, 2019, in anticipation of the Transactions, the Board adopted the 2019 Incentive Award Plan, which was an amendment, restatement and continuation of the 2016 Equity Incentive Plan. Upon closing of the Transactions, awards under the 2016 Equity Incentive Plan were converted using the exchange ratio established during the Transactions and assumed into the 2019 Incentive Award Plan (see Note 4 — “The Transactions”). A maximum aggregate amount of 60,000,000 ordinary shares are reserved for issuance under the 2019 Incentive Award Plan. Equity awards under the 2019 Incentive Award Plan may be issued in the form of options to purchase shares of the Company which are exercisable upon the occurrence of conditions specified within individual award agreements. The 2019 Incentive Award Plan permits the granting of awards in the form of incentive stock options, non-qualified stock options, share appreciation rights, restricted shares, restricted share units and other stock-based or cash based awards. Equity awards may be issued in the form of restricted shares or restricted share units with dividend rights or dividend equivalent rights subject to vesting terms and conditions specified in individual award agreements. The Company’s Management Incentive Plan provides for employees of the Company to be eligible to purchase shares of the Company. See Note 11 — “Shareholders’ Equity” for additional information. A summary of the Company’s share-based compensation is as follows: Three Months Ended June 30, 2019 2018 Share-based compensation expense $ 33,932 $ 2,842 Tax benefit recognized $ 85 $ 85 Six Months Ended June 30, 2019 2018 Share-based compensation expense $ 37,108 $ 7,022 Tax benefit recognized $ 163 $ 192 As of June 30, 2019, 34,747,066 ordinary shares remained available for issuance under the 2019 Incentive Award Plan. As of June 30, 2019, there was $12,971 of total unrecognized compensation cost, related to outstanding stock options, which is expected to be recognized through 2024 with a remaining weighted-average service period of 2.7 years. The Company’s stock option activity is summarized below: Weighted-Average Weighted Remaining Aggregate Number of Average Exercise Contractual Life Intrinsic Options Price per Share (in years) Value Balance at December 31, 2018, as originally reported 185,601 $ 1,587 8.5 $ 13,293 Modified options 24,339,097 — — — Balance at December 31, 2018, as modified 24,524,698 12.44 8.5 13,293 Granted 2,321,360 17.72 7.8 — Expired (278,011) 11.13 — — Forfeited (1,296,615) 10.95 — — Exercised (18,498) 7.41 — 147 Outstanding as of June 30, 2019 25,252,934 $ 11.28 8.3 $ 111,373 Vested and exercisable at June 30, 2019 13,768,097 $ 10.35 7.6 $ 63,761 As noted above, options issued and outstanding under the 2016 Equity Incentive Plan prior to the Transactions were converted to options under the 2019 Incentive Award Plan through the Exchange Ratio established in the Transactions see Note 4 — “The Transactions”. The 24,339,097 of options modified in the above table represent this share conversion. The aggregate intrinsic value in the table above represents the difference between the Company’s most recent valuation and the exercise price of each in-the-money option on the last day of the period presented. There were 18,498 stock options exercised in the six months ended June 30, 2019. The weighted-average fair value of options granted per share was $7.78 as of June 30, 2019. The Company accounts for awards issued under the 2019 Incentive Award Plan as additional contributions to equity. Share-based compensation includes expense associated with stock option grants which is estimated based on the grant date fair value of the award issued. Share-based compensation expense related to stock options is recognized over the vesting period of the award which is generally five years, on a graded-scale basis. The Company uses the Black-Scholes option pricing model to estimate the fair value of options granted. The Black-Scholes model takes into account the fair value of an ordinary share and the contractual and expected term of the stock option, expected volatility, dividend yield, and risk-free interest rate. Prior to becoming a public company, the fair value of the Company’s ordinary shares were determined utilizing an external third-party pricing specialist. The contractual term of the option ranges from the one year to 10 years. Expected volatility is the average volatility over the expected terms of comparable public entities from the same industry. The risk-free interest rate is based on a treasury rate with a remaining term similar to the contractual term of the option. The Company is recently formed and at this time does not expect to distribute any dividends. The Company recognizes forfeitures as they occur. The assumptions used to value the Company’s options granted during the period presented and their expected lives were as follows: June 30, 2019 Weighted-average expected dividend yield — Weighted-average expected volatility 19.87 % Weighted-average risk-free interest rate 2.43 % Expected life (in years) 5-9 Transactions Related Awards The Sponsor Agreement provided that certain ordinary shares of Clarivate available for distribution to persons designated in the Sponsor Agreement in connection with the Transactions, and certain Clarivate warrants available for distribution to such persons, in each case, are subject to certain time and performance-based vesting provisions described below. In addition, Incentive Shares were granted to persons designated in the Sponsor Agreement. See Note 11 — “Shareholders’ Equity” for details on the respective awards. The vesting conditions added to certain ordinary shares include the following: 5,309,713 ordinary shares of Clarivate held by persons designated in the Sponsor Agreement, will vest in three equal annual installments on the first, second and third anniversaries of the closing of the Transactions, respectively, and are not contingent on continuing or future service of the respective holders to the Company. 2,654,856 ordinary shares of Clarivate held by such persons will vest at such time as the last sale price of Clarivate’s ordinary shares is at least $15.25 on or before the date that is 42 months after the closing of the Transactions, and are not contingent on continuing or future service of the respective holders to the Company. 2,654,856 ordinary shares of Clarivate held by such persons will vest at such time as the last sale price of Clarivate’s ordinary shares is at least $17.50 on or before the fifth anniversary of the closing of the Transactions, and are not contingent on continuing or future service of the respective holders to the Company. The vesting conditions added to certain warrants include the following: 17,265,826 of certain warrants held by persons designated in the Sponsor Agreement, will vest at such time as the last sale price of Clarivate’s ordinary shares is at least $17.50 on or before the fifth anniversary of the closing of the Transactions; provided that none of such Clarivate warrants will vest prior to the first anniversary of the closing of the Transactions, not more than 1/3 of such Clarivate warrants will vest prior to the second anniversary of the closing of the Transactions, and not more than 2/3 of such Clarivate warrants will vest prior to the third anniversary of the closing of the Transactions. Further, such vesting is not contingent on continuing or future service of the respective holders to the Company In considering the terms of the transaction related awards, the Company notes that the time based vesting restrictions are not conditioned on any continuing or future service of the holders to the Company, and reflect “lock-up” periods of the issuable shares. Further, the abovementioned performance-based restrictions are considered market conditions pursuant to ASC 718, and are contemplated in the value of the awards. As such vesting restrictions were contemplated in conjunction with the granting of Incentive Shares (Note 11), the Company considered such terms of the total basket of transaction awards in determination of the fair value of the awards. As no continued or future service is required by the holders of such awards, the Company recognized compensation expense based on the fair value of such awards upon closing of the Transactions. The Company recognized $25,013 expense, net in Share-based compensation expense as of the date of the Transactions in accordance with the issuance of incentive shares offset by the addition of vesting terms to certain ordinary shares and warrants, as described above. The expense includes the increases in value of $48,102 for the granting of incentive shares, the increase in value of $1,193 for ordinary shares with only time vesting conditions, and the increase in value of shares purchased by the Founders immediately prior to the transaction of $4,411, all offset by the reduction in value of $9,396 for ordinary shares with performance vesting condition of $15.25, the reduction in value of $13,101 for ordinary shares with performance vesting condition of $17.50 and the reduction in value of $6,297 related to warrants. Pursuant to the Sponsor Agreement, certain founders of Churchill Capital Corp purchased an aggregate of 1,500,000 shares of Class B common stock of Churchill immediately prior to the closing of the Transactions for an aggregate purchase price of $15,000. We used a third-party specialist to fair value the awards at the Transactions close date of May 13, 2019 using the Monte Carlo simulation approach. The assumptions included in the model include, but are not limited to, risk-free interest rate, 2.20%; expected volatility of the Company’s and the peer group’s stock prices, 20.00%; and dividend yield, 0.00%. A discount for lack or marketability (“DLOM”) was applied to shares that are subject to remaining post vesting lock up restrictions. The DLOM was between 3%-7% dependent on the length of the post vesting restriction period. Incentive Shares granted in connection with the Transactions are available for future assignment by the holders. The Company will evaluate if additional stock compensation expense is required upon any future assignment of such awards. | Note 17:Employee Incentive Plans Prior to the Transactions, the Company operated under its 2016 Equity Incentive Plan, which provided for certain employees of the Company to be eligible to participate in equity ownership in the Company. On May 8, 2019, in anticipation of the Transactions, the Board adopted the 2019 Incentive Award Plan, which was an amendment, restatement and continuation of the 2016 Equity Incentive Plan. Upon closing of the Transactions, awards under the 2016 Equity Incentive Plan were converted using the exchange ratio established during the Transactions and assumed into the 2019 Incentive Award Plan (see Note 4 — “The Transactions”). A maximum aggregate amount of 60,000,000 ordinary shares are reserved for issuance under the 2019 Incentive Award Plan. Equity awards under the 2019 Incentive Award Plan may be issued in the form of options to purchase shares of the Company which are exercisable upon the occurrence of conditions specified within individual award agreements. The 2019 Incentive Award Plan permits the granting of awards in the form of incentive stock options, non-qualified stock options, share appreciation rights, restricted shares, restricted share units and other stock-based or cash based awards. Equity awards may be issued in the form of restricted shares or restricted share units with dividend rights or dividend equivalent rights subject to vesting terms and conditions specified in individual award agreements. The Company’s Management Incentive Plan provides for employees of the Company to be eligible to purchase shares of the Company. See Note 11 — “Shareholders’ Equity” for additional information. A summary of the Company’s share-based compensation is as follows: Three Months Ended September 30, 2019 2018 Share-based compensation expense $ 9,567 $ 3,660 Tax benefit recognized $ 45 $ 96 Nine Months Ended September 30, 2019 2018 Share-based compensation expense $ 46,675 $ 10,682 Tax benefit recognized $ 201 $ 288 As of September 30, 2019, 37,043,548 ordinary shares remained available for issuance under the 2019 Incentive Award Plan. In the three months ended September 30, 2019, the Company recognized additional share-based compensation expense related to the modification of certain awards under the 2019 Incentive Award Plan. As of September 30, 2019, there was $8,934 of total unrecognized compensation cost, related to outstanding stock options, which is expected to be recognized through 2024 with a remaining weighted-average service period of 2.5 years. The Company’s stock option activity is summarized below: Weighted-Average Weighted Remaining Aggregate Number of Average Exercise Contractual Life Intrinsic Options Price per Share (in years) Value Balance at December 31, 2018, as originally reported 185,601 $ 1,587 8.5 $ 13,293 Modified options 24,339,097 — — — Balance at December 31, 2018, as modified 24,524,698 12.44 8.5 13,293 Granted 2,321,360 17.55 9.5 — Expired (820,612) 8.54 — — Forfeited (2,268,238) 11.24 — — Exercised (800,756) 6.66 — 8,106 Outstanding as of September 30, 2019 22,956,452 $ 11.96 7.9 $ 146,085 Vested and exercisable at September 30, 2019 14,374,000 $ 11.52 7.7 $ 79,377 As noted above, options issued and outstanding under the 2016 Equity Incentive Plan prior to the Transactions were converted to options under the 2019 Incentive Award Plan through the Exchange Ratio established in the Transactions (see Note 4 — “The Transactions”). The 24,339,097 of options modified in the above table represent this share conversion. The aggregate intrinsic value in the table above represents the difference between the closing price of the Company’s common shares on September 30, 2019 and the exercise price of each in-the-money option. There were 800,756 stock options exercised in the nine months ended September 30, 2019. The weighted-average fair value of options granted per share was $9.54 as of September 30, 2019. The Company accounts for awards issued under the 2019 Incentive Award Plan as additional contributions to equity. Share-based compensation includes expense associated with stock option grants which is estimated based on the grant date fair value of the award issued. Share-based compensation expense related to stock options is recognized over the vesting period of the award which is generally five years, on a graded-scale basis. The Company uses the Black-Scholes option pricing model to estimate the fair value of options granted. The Black-Scholes model takes into account the fair value of an ordinary share and the contractual and expected term of the stock option, expected volatility, dividend yield, and risk-free interest rate. Prior to becoming a public company, the fair value of the Company’s ordinary shares were determined utilizing an external third-party pricing specialist. The contractual term of the option ranges from the one year to 10 years. Expected volatility is the average volatility over the expected terms of comparable public entities from the same industry. The risk-free interest rate is based on a treasury rate with a remaining term similar to the contractual term of the option. The Company is recently formed and at this time does not expect to distribute any dividends. The Company recognizes forfeitures as they occur. The assumptions used to value the Company’s options granted during the period presented and their expected lives were as follows: September 30, 2019 Weighted-average expected dividend yield — Weighted-average expected volatility 19.87 % Weighted-average risk-free interest rate 2.43 % Expected life (in years) 5-9 Transactions Related Awards The Sponsor Agreement provided that certain ordinary shares of Clarivate available for distribution to persons designated in the Sponsor Agreement in connection with the Transactions, and certain Clarivate warrants available for distribution to such persons, in each case, were subject to certain time and performance-based vesting provisions described below. In addition, Incentive Shares were granted to persons designated in the Sponsor Agreement. See Note 11 — “Shareholders’ Equity” for details on the respective awards. The vesting conditions added to certain ordinary shares include the following: 5,309,713 ordinary shares of Clarivate held by persons designated in the Sponsor Agreement, will vest in three equal annual installments on the first, second and third anniversaries of the closing of the Transactions, respectively, and are not contingent on continuing or future service of the respective holders to the Company. 2,654,856 ordinary shares of Clarivate held by such persons will vest at such time as the last sale price of Clarivate’s ordinary shares is at least $15.25 on or before the date that is 42 months after the closing of the Transactions ; provided that none of such Clarivate ordinary shares will vest prior to the first anniversary of the closing of the Transactions, not more than 1/3 of such Clarivate warrants will vest prior to the second anniversary of the closing of the Transactions, and not more than 2/3 of such Clarivate warrants will vest prior to the third anniversary of the closing of the Transactions. Further, such vesting is not contingent on continuing or future service of the respective holders to the Company. 2,654,856 ordinary shares of Clarivate held by such persons will vest at such time as the last sale price of Clarivate’s ordinary shares is at least $17.50 on or before the fifth anniversary of the closing of the Transactions ; provided that none of such Clarivate ordinary shares will vest prior to the first anniversary of the closing of the Transactions, not more than 1/3 of such Clarivate warrants will vest prior to the second anniversary of the closing of the Transactions, and not more than 2/3 of such Clarivate warrants will vest prior to the third anniversary of the closing of the Transactions. Further, such vesting is not contingent on continuing or future service of the respective holders to the Company. The vesting conditions added to certain warrants include the following: 17,265,826 of certain warrants held by persons designated in the Sponsor Agreement, will vest at such time as the last sale price of Clarivate’s ordinary shares is at least $17.50 on or before the fifth anniversary of the closing of the Transactions; provided that none of such Clarivate warrants will vest prior to the first anniversary of the closing of the Transactions, not more than 1/3 of such Clarivate warrants will vest prior to the second anniversary of the closing of the Transactions, and not more than 2/3 of such Clarivate warrants will vest prior to the third anniversary of the closing of the Transactions. Further, such vesting is not contingent on continuing or future service of the respective holders to the Company. In considering the terms of the transaction related awards, the Company notes that the time based vesting restrictions were not conditioned on any continuing or future service of the holders to the Company, and reflect “lock-up” periods of the issuable shares. Further, the above mentioned performance-based restrictions were considered market conditions pursuant to ASC 718, and are contemplated in the value of the awards. As such vesting restrictions were contemplated in conjunction with the granting of Incentive Shares (Note 11), the Company considered such terms of the total basket of transaction awards in determination of the fair value of the awards. As no continued or future service was required by the holders of such awards, the Company recognized compensation expense in the second quarter based on the fair value of such awards upon closing of the Transactions. The Company recognized $25,013 expense, net in Share-based compensation expense as of the date of the Transactions in accordance with the issuance of incentive shares offset by the addition of vesting terms to certain ordinary shares and warrants, as described above. The expense included the increases in value of $48,102 for the granting of incentive shares, the increase in value of $1,193 for ordinary shares with only time vesting conditions, and the increase in value of shares purchased by the Founders immediately prior to the transaction of $4,411, all offset by the reduction in value of $9,396 for ordinary shares with performance vesting condition of $15.25, the reduction in value of $13,101 for ordinary shares with performance vesting condition of $17.50 and the reduction in value of $6,297 related to warrants. Pursuant to the Sponsor Agreement, certain founders of Churchill Capital Corp purchased an aggregate of 1,500,000 shares of Class B common stock of Churchill immediately prior to the closing of the Transactions for an aggregate purchase price of $15,000. We used a third-party specialist to fair value the awards at the Transactions close date of May 13, 2019 using the Monte Carlo simulation approach. The assumptions included in the model include, but are not limited to, risk-free interest rate, 2.20%; expected volatility of the Company’s and the peer group’s stock prices, 20.00%; and dividend yield, 0.00%. A discount for lack or marketability (“DLOM”) was applied to shares that are subject to remaining post vesting lock up restrictions. The DLOM was between 3%-7% dependent on the length of the post vesting restriction period. On August 14, 2019, Clarivate (on its behalf and on behalf of its subsidiaries) agreed to waive the performance and time vesting conditions, described above, subject to the consummation of the secondary offering. These shares and warrants nevertheless remain subject to a lock-up for a period ranging from two to three years following the closing of the Mergers. We used a third-party specialist to fair value the awards at the modification date using the Monte Carlo simulation approach. The assumptions included in the model include, but are not limited to, risk-free interest rate, 1.42%; expected volatility of the Company's and the peer group's stock prices, 20.00%; and dividend yield, 0.00%. A discount for lack or marketability ("DLOM") was applied to shares that are subject to remaining post vesting lock up restrictions. The DLOM was between 3%-7% dependent on the length of the post vesting restriction period. Waiving the performance and time vesting conditions resulted in an immaterial impact to the Interim Condensed Consolidated Statements of Operations. Incentive Shares granted in connection with the Transactions are available for future assignment by the holders. Company will evaluate if additional stock compensation expense is required upon any future assignment of such awards. | Note 15: Employment and Compensation Arrangements Employee Incentive Plans The Company’s 2016 Equity Incentive Plan provides for certain employees of the Company to be eligible to participate in equity ownership in the Company. Equity awards may be issued in the form of options to purchase shares of the Company which are exercisable upon the occurrence of conditions specified within individual award agreements. Equity awards may also be issued in the form of restricted shares with dividend rights subject to vesting terms and conditions specified in individual award agreements. Additionally, the Company may make available share purchase rights under the terms of the 2016 Equity Incentive Plan. Total share-based compensation expense included in the Consolidated Statements of Operations amounted to $13,715 and $17,663 for the years ended December 31, 2018 and 2017, respectively. The total associated tax benefits recognized amounted to $2,740 and $3,192 for the years ended December 31, 2018 and 2017, respectively. The Company’s Management Incentive Plan provides for certain employees of the Company to be eligible to purchase shares of the Company. See Note 14 — Shareholders’ Equity for additional information. Along with each subscription, employees may receive a corresponding number of options to acquire additional ordinary shares subject to five year vesting. The Company issues shares for stock options from authorized shares. At December 31, 2018, the Company was authorized to grant up to 33,034,167 stock options under its existing stock incentive plans. As of December 31, 2018 and 2017, 8,509,469 and 10,479,363, respectively, stock options have not been granted. As of December 31, 2018 and 2017, there was $19,637 and $29,633, respectively, of total unrecognized compensation cost, related to outstanding stock options, which is expected to be recognized through 2023 with a remaining weighted-average service period of 5.0 years. The Company’s stock option activity is summarized below: Number Weighted Average Weighted Average Aggregate of Exercise Price per Remaining Intrinsic Options Share Contractual Life Value Balance at December 31, 2017, as originally reported 170,693 $ 1,572.00 9.3 $ 2,262 Modified options 22,384,111 — — — Balance at December 31, 2017, as modified 22,554,804 12.32 9.3 2,262 Granted 4,119,737 11.73 9.7 — Forfeited and expired (2,149,843) 11.15 — — Outstanding as of December 31, 2018 24,524,698 $ 11.07 8.5 $ 13,293 Vested and exercisable at December 31, 2018 6,654,930 $ 10.92 8.3 $ 3,880 The aggregate intrinsic value in the table above represents the difference between the Company’s most recent valuation and the exercise price of each in-the-money option on the last day of the period presented. No stock options were exercised in the years ended December 31, 2018 or 2017. The weighted-average fair value of options granted per share was $1.56 and $1.76 as of December 31, 2018 and 2017, respectively. The Company accounts for awards issued under the Equity Incentive Plan as additional contributions to equity. Share-based compensation includes expense associated with stock option grants which is estimated based on the grant date fair value of the award issued. Share-based compensation expense related to stock options is recognized over the vesting period of the award, which is generally five years, on a graded-scale basis. The Company uses the Black-Scholes option pricing model to estimate the fair value of options granted. The Black-Scholes model takes into account the fair value of an ordinary share and the contractual and expected term of the stock option, expected volatility, dividend yield, and risk-free interest rate. The fair value of our ordinary shares is determined utilizing an external third party pricing specialist. The contractual term of the option ranges from the 1 year to 10 years. While the Company does not have any history for expected terms, employees do not have any specific benefit to exercise the options before the terms are met as the shares are not freely tradable, and as such an expected term near the high end of the contractual range is deemed most appropriate. Expected volatility is the average volatility over the expected terms of comparable public entities from the same industry historical data. The risk-free interest rate is based on a treasury rate with a remaining term similar to the contractual term of the option. The Company is recently formed and at this time does not expect to distribute any dividends. The Company recognizes forfeitures as they occur and does not expect to have material forfeitures. The assumptions used to value the Company’s options granted during the period presented and their expected lives were as follows: December 31, 2018 2017 Weighted-average expected dividend yield — — Expected volatility 21.00 – 23.05% 24.84 – 27.90% Weighted-average expected volatility Weighted-average risk-free interest rate Expected life (in years) 8.5 9.0 |
Tax Receivable Agreement
Tax Receivable Agreement | 6 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | |
Tax Receivable Agreement | ||
Tax Receivable Agreement | Note 15: Tax Receivable Agreement At the completion of the Transactions, we recorded an initial liability of $264,600 payable to the pre-business combination equity holders under the TRA, representing approximately 85% of the calculated tax savings based on the portion of the Covered Tax Assets we anticipate being able to utilize in future years. Based on current projections of taxable income, and before deduction of any specially allocated depreciation and amortization, we anticipate having enough taxable income to utilize a significant portion of these specially allocated deductions related to the original Covered Tax Assets (as defined in the TRA). Total payments related to the TRA could be up to a maximum of $507,326 if all Covered Tax Assets are utilized. TRA payments are expected to commence in 2021 (with respect to taxable periods ending in 2019) and will be subject to deferral, at the Company’s election, for payment amounts in excess of $30,000 for payments to be made in 2021 and 2022, but will not be subject to deferral thereafter. As of June 30, 2019, our liability under the TRA was $264,600. The projection of future taxable income involves significant judgment. Actual taxable income may differ from our estimates, which could significantly impact the liability under the TRA. We have determined it is more-likely-than-not we will be unable to utilize all of our deferred tax assets (“DTAs”) subject to the TRA; therefore, we have not recorded a liability under the TRA related to the tax savings we may realize from the utilization of NOL carryforwards and the amortization related to basis adjustments created by the Transaction. If utilization of these DTAs becomes more-likely-than-not in the future, at such time, we will record liabilities under the TRA of up to an additional $134,377 as a result of basis adjustments under the Internal Revenue Code and up to an additional $108,350 related to the utilization of NOL and credit carryforwards, which will be recorded through charges to our statements of operations. However, if the tax attributes are not utilized in future years, it is possible no amounts would be paid under the TRA. In this scenario, the reduction of the liability under the TRA would result in a benefit to our statements of operations. | Note 15: Tax Receivable Agreement At the completion of the Transactions, we recorded an initial liability of $264,600 payable to the pre-business combination equity holders under the TRA, representing approximately 85% of the calculated tax savings based on the portion of the Covered Tax Assets we anticipate being able to utilize in future years. Based on current projections of taxable income, and before deduction of any specially allocated depreciation and amortization, we anticipate having enough taxable income to utilize a significant portion of these specially allocated deductions related to the original Covered Tax Assets (as defined in the TRA). Total payments related to the TRA could be up to a maximum of $507,326 if all Covered Tax Assets are utilized. TRA payments are expected to commence in 2021 (with respect to taxable periods ending in 2019) and will be subject to deferral, at the Company’s election, for payment amounts in excess of $30,000 for payments to be made in 2021 and 2022, but will not be subject to deferral thereafter. As of September 30, 2019, our liability under the TRA was $264,600. The projection of future taxable income involves significant judgment. Actual taxable income may differ from our estimates, which could significantly impact the liability under the TRA. We have determined it is more-likely-than-not we will be unable to utilize all of our deferred tax assets (“DTAs”) subject to the TRA; therefore, we have not recorded a liability under the TRA related to the tax savings we may realize from the utilization of NOL carryforwards and the amortization related to basis adjustments created by the Transaction. If utilization of these DTAs becomes more-likely-than-not in the future, at such time, we will record liabilities under the TRA of up to an additional $134,377 as a result of basis adjustments under the Internal Revenue Code and up to an additional $108,350 related to the utilization of NOL and credit carryforwards, which will be recorded through charges to our statements of operations. However, if the tax attributes are not utilized in future years, it is possible no amounts would be paid under the TRA. In this scenario, the reduction of the liability under the TRA would result in a benefit to our statements of operations. On August 21, 2019, the Comoabt entered into a Buyout Agreement among the Company and Onex Partners IV LP ("TRA Buyout Agreement"), pursuant to which the Company agreed to terminate all future payment obligations of the Company under the Tax Receivable Agreement in exchange for a payment of $200,000 (the "TRA Termination Payment"). Payment of the TRA Termination Payment is due five business days following receipt by the Company and/or its subsidiaries of net cash proceeds of one or more transactions with sources of equity or debt financing that, together with other sources of cash readily available to the Company and its subsidiaries that we determine to utilize for such purpose, are sufficient to pay the TRA Termination Payment. In the event the TRA Termination Payment has not been fully paid in cash prior to December 31, 2019, the parties' obligations under the TRA Buyout Agreement will automatically terminate and the Company's obligations under the Tax Receivable Agreement will be unmodified and remain in full force and effect, provided this deadline may be extended upon mutual written consent. The TRA Buyout Agreement requires the Company's to use commercially reasonable efforts to obtain debt or equity financing that will permit it to make the TRA Termination Payment prior to December 31, 2019, and the source of the payment is expected to be a combination of either cash on hand, borrowings under the existing Credit Facilities, proceeds from a refinancing of our existing debt and/or issuance of new debt. Effective upon the Company's payment in full of the TRA Termination Payment, the Company's obligation to make payments under the Tax Receivable Agreement will terminate. |
Income Taxes
Income Taxes | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Income Taxes | |||
Income Taxes | Note 14: Income Taxes During the three and six months ended June 30, 2019, the Company recognized an income tax provision of $3,712 $74,049 and $133,069. During the three and six months ended June 30, 2018, the Company recognized an income tax provision of $11, and $357, respectively, on a loss before income tax of $66,933 and $143,624, respectively. The tax provision in each period ended June 30, 2019, and June 30, 2018, respectively, reflects the mix of taxing jurisdictions in which pre-tax profits and losses were recognized. | Note 14: Income Taxes During the three and nine months ended September 30, 2019, the Company recognized an income tax provision of $1,644 $120,594, respectively. During the three and nine months ended September 30, 2018, the Company recognized an income tax provision of $3,244, and $3,601, respectively, on a loss before income tax of $51,483 and $195,107, respectively. The tax provision in each period ended September 30, 2019, and September 30, 2018, respectively, reflects the mix of taxing jurisdictions in which pre-tax profits and losses were recognized. | Note 16: Income Taxes Income tax (benefit)/expense on income/(loss) analyzed by jurisdiction is as follows: Years Ended December 31, 2018 2017 Current U.K. $ 1,014 $ (142) U.S. Federal 6,395 5,202 U.S. State 2,146 833 Other 11,061 8,552 Total current 20,616 14,445 Deferred U.K. 85 (427) U.S. Federal (5,465) (10,648) U.S. State (227) (142) Other (9,360) (24,521) Total deferred(1) (14,967) (35,738) Total provision (benefit) for income taxes $ 5,649 $ (21,293) (1) Due to rate reductions in the U.S. and Belgium enacted in the 4th quarter of 2017. The components of pre-tax loss are as follows: Years Ended December 31, 2018 2017 U.K. $ (222,043) $ (211,944) U.S. (11,880) (58,054) Other loss (2,590) (15,225) Pre-tax loss $ (236,513) $ (285,223) A reconciliation of the statutory U.K. income tax rate to the Company’s effective tax rate is as follows: Years Ended December 31, 2018 2017 Loss before tax: $ (236,513) $ (285,223) Income tax, at the statutory rate (44,937) (54,905) Statutory rate(1) 19.0 % 19.3 % Effect of different tax rates (1.2) % 3.3 % Tax rate modifications(2) — % 5.7 % Valuation Allowances (18.0) % (20.8) % Permanent differences (0.7) % 0.3 % Withholding tax (0.2) % (0.3) % Tax indemnity (2.7) % — % Sale of Subsidiary 2.2 % — % Other (0.8) % — % Effective rate (2.4) % 7.5 % (1) The Company performs a reconciliation of the income tax provisions based on its domicile and statutory rate. Reconciliations are based on the U.K. statutory corporate tax rate. (2) Due to rate reductions in the U.S. and Belgium enacted in the 4th quarter of 2017. The tax effects of the significant components of temporary differences giving rise to the Company’s deferred income tax assets and liabilities are as follows: December 31, 2018 2017 Accounts receivable $ 916 $ 1,310 Goodwill — 1,217 Fixed assets, net — 1,670 Accrued expenses 3,735 3,417 Deferred revenues 3,570 915 Other assets 9,655 4,700 Unrealized gain/loss 74 528 Debt issuance costs 1,199 — Operating losses and tax attributes 135,219 94,571 Total deferred tax assets 154,368 108,328 Valuation allowances (133,856) (92,812) Net deferred tax assets 20,512 15,516 Other identifiable intangible assets, net (43,247) (57,082) Other liabilities (7,785) (3,286) Goodwill (42) — Fixed Assets, net (238) — Debt issuance costs — (116) Total deferred tax liabilities (51,312) (60,484) Net deferred tax liabilities $ (30,800) $ (44,968) In the Consolidated Balance Sheets, deferred tax assets and liabilities are shown net if they are in the same jurisdiction. The components of the net deferred tax liabilities as reported on the Consolidated Balance Sheets are as follows: December 31, 2018 2017 Deferred tax asset $ 12,426 $ 6,824 Deferred tax liability (43,226) (51,792) Net deferred tax liability $ (30,800) $ (44,968) The Tax Cuts and Jobs Act (the Act) was enacted in the US on December 22, 2017. Of most relevance to the Company, the Act reduced the US federal corporate income tax rate to 21% from 35%, established a Base Erosion Anti-Abuse Tax (“BEAT”) regime and changed the provisions limiting current interest deductions and use of NOL carryforwards. Certain new provisions are effective for the Company beginning December 1, 2018 and did not have a material impact to the 2018 financial statements. SAB 118 measurement period We applied the guidance in SAB 118 when accounting for the enactment-date effects of the Act in 2017 and throughout 2018. At December 31, 2017, we had not completed our accounting for all of the enactment-date income tax effects of the Act under ASC 740, Income Taxes, for the remeasurement of deferred tax assets and liabilities and recorded a provisional tax benefit amount of $2,237 under SAB 118. At December 31, 2018, we have now completed our accounting for all of the enactment-date income tax effects of the Act. As further discussed above, during 2018, we did not recognize any adjustments to the provisional amounts recorded at December 31, 2017. Deferred tax assets and liabilities As of December 31, 2017, we remeasured certain deferred tax assets and liabilities based on the rates at which they were expected to reverse in the future (which was generally 21% for the US and 25% for Belgium), by recording a tax benefit amount of $2,237 (provisional) related to the US and $14,290 related to Belgium. Upon further analysis and refinement of our calculations during the 12 months ended December 31, 2018, it was determined that no adjustment to these amounts was necessary. The Company is required to assess the realization of its deferred tax assets and the need for a valuation allowance. The assessment requires judgment on the part of management with respect to benefits that could be realized from future taxable income. The valuation allowance is $133,856 and $92,812 at December 31, 2018 and 2017, respectively against certain deferred tax assets, as it more likely than not that such amounts will not be fully realized. During the years ended December 31, 2018 and 2017, the valuation allowance increased by $41,044 and $44,633, respectively, primarily due to operating losses in certain jurisdictions and an increase in deferred tax assets with a full valuation allowance. The increases were partially offset by the release of valuation allowances in jurisdictions with current year operating income. At December 31, 2018, the Company had U.K. tax loss carryforwards of $352,632, Japan tax loss carryforwards of $58,901, U.S. federal tax loss carryforwards of $104,122, tax loss carryforwards in other foreign jurisdictions of $18,495, and U.S. state tax loss carryforwards of $67,823. The majority of the unrecognized deductible tax losses relate to UK, US, and Japan. The carryforward period for the Japan tax losses is nine years, and the expiration period begins 2025. The carryforward period for the UK tax losses is indefinite. The carryforward period for US federal tax losses is twenty years for losses generated in tax years ended prior to December 31, 2017. The expiration period for these losses begins in 2036. For US losses generated in tax years beginning after January 1, 2018, the carryforward period is indefinite. The carryforward period for US state losses varies, and the expiration period is between 2018 and 2036. The Company has not provided income taxes and withholding taxes on the undistributed earnings of foreign subsidiaries as of December 31, 2018 because the Company intends to permanently reinvest such earnings. As of December 31, 2018, the cumulative amount of earnings upon which income taxes and withholding taxes have not been provided is approximately $7,748. Determination of the amount of unrecognized deferred tax liability related to these earnings is not practicable. Uncertain Tax Positions Unrecognized tax benefits represent the difference between the tax benefits that we are able to recognize for financial reporting purposes and the tax benefits that we have recognized or expect to recognize in filed tax returns. The total amount of net unrecognized tax benefits that, if recognized, would impact the Company’s effective tax rate were $1,450 and $91 as of December 31, 2018 and 2017, respectively. The Company recognizes accrued interest and penalties associated with uncertain tax positions as part of the tax provision. As of December 31, 2018, the interest and penalties are $449 and as of December 31, 2017, the interest and penalties are $5. It is reasonably possible that the amount of unrecognized tax benefits will change during the next 12 months by a range of $0 to $252. The Company files income tax returns in the United States and various non-U.S. jurisdictions. As of December 31, 2018, the Company’s open tax years subject to examination were 2014 through 2018. The following table summarizes the Company’s unrecognized tax benefits, excluding interest and penalties: December 31, 2018 2017 Balance at the Beginning of the year $ 91 $ 211 Increases for tax positions taken in prior years 1,339 — Increases for tax positions taken in the current year 72 — Decreases due to statute expirations (52) (120) Balance at the End of the year $ 1,450 $ 91 |
Earnings per Share
Earnings per Share | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Earnings per Share | |||
Earnings per Share | Note 18: Earnings per Share Potential common shares of 85,052,934 and 23,000,095 related to Private Placement Warrants, Public Warrants, Incentive Shares and options related to the Employee Incentive Plan were excluded from diluted EPS for the three and six months ended June 30, 2019 and 2018, as the Company had net losses and their inclusion would be anti-dilutive. See Note 11 —“Shareholders’ Equity” and Note 17— “Employee Incentive Plans” for a description. The Transactions were accounted for as a reverse recapitalization in accordance with U.S. GAAP. See Note 4 — “The Transactions”. Accordingly, weighted-average shares outstanding for purposes of the EPS calculation have been retroactively restated as shares reflecting the exchange ratio established in the Transactions (1.0 Jersey share to 132.13667 Clarivate shares). The basic and diluted EPS computations for our common stock are calculated as follows (in thousands, except per share amounts): Three Months Ended June 30, 2019 2018 Basic/Diluted EPS Net loss $ (77,761) $ (66,944) Weighted-average number of common shares outstanding 264,762,720 217,461,225 Basic EPS (0.29) (0.31) Diluted EPS (0.29) (0.31) Six Months Ended June 30, 2019 2018 Basic/Diluted EPS Net loss $ (137,021) $ (143,981) Weighted-average number of common shares outstanding 241,275,061 217,411,896 Basic EPS (0.57) (0.66) Diluted EPS (0.57) (0.66) | Note 18: Earnings per Share Potential common shares of 9,713,683 related to Incentive Shares and options related to the Employee Incentive Plan were excluded from diluted EPS for the three months ended September 30, 2019 as their inclusion would be anti-dilutive or their performance metric was not met. Potential common shares of 82,756,452 related to Private Placement Warrants, Public Warrants, Incentive Shares and options related to the Employee Incentive Plan were excluded from diluted EPS for the nine months ended September 30, 2019 , as the Company had a net loss and their inclusion would be anti-dilutive or their performance metric was not met. Potential common shares of 24,059,222 related to options granted under the Employee Incentive Plan were excluded from diluted EPS for the three and nine months ended September 30, 2018, as the Company had net losses and their inclusion would be anti-dilutive. See Note 11 —“Shareholders’ Equity” and Note 17— “Employee Incentive Plans” for a description. The Transactions were accounted for as a reverse recapitalization in accordance with U.S. GAAP. See Note 4 — “The Transactions”. Accordingly, weighted-average shares outstanding for purposes of the EPS calculation have been retroactively restated as shares reflecting the exchange ratio established in the Transactions (1.0 Jersey share to 132.13667 Clarivate shares). The basic and diluted EPS computations for our common stock are calculated as follows (in thousands, except per share amounts): Three Months Ended September 30, 2019 2018 Basic/Diluted EPS Net income (loss) $ 10,831 $ (54,727) Basic Weighted-average number of common shares outstanding 305,428,062 217,506,553 Diluted Weighted-average number of common shares outstanding 328,854,063 217,506,553 Basic EPS 0.04 (0.25) Diluted EPS 0.03 (0.25) Nine Months Ended September 30, 2019 2018 Basic/Diluted EPS Net loss $ (126,190) $ (198,708) Basic Weighted-average number of common shares outstanding 262,894,388 217,450,475 Diluted Weighted-average number of common shares outstanding 262,894,388 217,450,475 Basic EPS (0.48) (0.91) Diluted EPS (0.48) (0.91) | Note 17: Earnings per Share Potential common shares of 24,524,698 and 22,554,804 related to options under the employee incentive plan were excluded from diluted EPS for the years ended December 31, 2018 and 2017, respectively, as the Company had a net loss for the years ended December 31, 2018 and 2017. See “Note 15 — Employment and Compensation Arrangements.” The basic and diluted EPS computations for our common stock are calculated as follows (in thousands, except per share amounts): Years Ended December 31, 2018 2017 Basic/Diluted EPS Net loss $ (242,162) $ (263,930) Preferred stock dividends — — Income available to common stockholders $ (242,162) $ (263,930) Weighted-average number of common shares outstanding 217,472,870 216,848,866 Basic EPS $ (1.11) $ (1.22) Diluted EPS $ (1.11) $ (1.22) |
Product and Geographic Sales In
Product and Geographic Sales Information | 12 Months Ended |
Dec. 31, 2018 | |
Product and Geographic Sales Information | |
Product and Geographic Sales Information | Note 18: Product and Geographic Sales Information The Company’s chief operating decision maker (“CODM”) assesses Company-wide performance and allocates resources based on consolidated financial information. As such, the company has one operating and reportable segment. The CODM evaluates performance based on profitability. No single customer accounted for more than 1% of revenues and our ten largest customers represented only 6% and 7% of revenues for the years ended December 31, 2018 and 2017, respectively. Revenues by geography The following table summarizes revenues from external customers by geography, which is based on the location of the customer: Years Ended December 31, 2018 2017 Revenues: North America $ 450,356 $ 455,791 Europe 242,415 243,245 APAC 209,118 201,234 Emerging Markets 69,731 67,037 Deferred revenues adjustment (3,152) (49,673) Total $ 968,468 $ 917,634 Assets by geography Assets are allocated based on operations and physical location. The following table summarizes non-current assets other than financial instruments and deferred tax assets by geography: December 31, 2018 2017 Assets: North America $ 1,036,192 $ 1,163,704 Europe 2,145,073 2,294,998 APAC 79,487 68,034 Emerging Markets 24,241 26,533 Total $ 3,284,993 $ 3,553,269 Revenue by product group The following table summarizes revenue by product group (in thousands): Years Ended December 31, 2018 2017 Web of Science Product Line $ 361,957 $ 352,995 Cortellis Product Line 165,920 165,995 Science Group 527,877 518,990 Derwent Product Line 179,321 176,201 MarkMonitor Product Line 122,947 120,408 Years Ended December 31, 2018 2017 CompuMark Product Line 121,025 119,854 Intellectual Property Group 423,293 416,463 IP Management Product Line 20,450 31,854 Deferred revenues adjustment (3,152) (49,673) Total $ 968,468 $ 917,634 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Commitments and Contingencies | |||
Commitments and Contingencies | Note 16: Commitments and Contingencies Lawsuits and Legal Claims The Company is engaged in various legal proceedings, claims, audits and investigations that have arisen in the ordinary course of business. These matters include, but are not limited to, antitrust/competition claims, intellectual property infringement claims, employment matters and commercial matters. The outcome of all of the matters against the Company is subject to future resolution, including the uncertainties of litigation. Based on information currently known to the Company and after consultation with outside legal counsel, management believes that the ultimate resolution of any such matters, individually or in the aggregate, will not have a material impact on the Company’s financial condition taken as a whole. Contingent Liabilities In conjunction with the acquisition of Publons, the Company agreed to pay former shareholders up to an additional $9,500 through 2020. Amounts payable are contingent upon Publons’ achievement of certain milestones and performance metrics. The Company had an outstanding liability for $3,429 and $2,960 related to the estimated fair value of this contingent consideration as of June 30, 2019 and December 31, 2018, respectively. The outstanding balance consisted of $2,385 and $1,600 included in Accrued expenses and other current liabilities, and $1,044 and $1,360 included in Other non-current liabilities in the Interim Condensed Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018, respectively. In conjunction with the acquisition of TrademarkVision that occurred on October 25, 2018, the Company agreed to pay former shareholders a potential earn-out dependent upon achievement of certain milestones and financial performance metrics through 2020. Amounts payable are contingent upon TrademarkVision’s achievement of certain milestones and performance metrics. As of June 30, 2019 and December 31, 2018, the Company had an outstanding liability for $4,115 related to the estimated fair value of this contingent consideration. The outstanding balance was included in Accrued expenses and other current liabilities as of June 30, 2019, and in Other non-current liabilities as of December 31, 2018, in the condensed consolidated balance sheets. Tax Indemnity In connection with the 2016 Transaction, the Company recorded certain tax indemnification assets pursuant to the terms of the separation and indemnified liabilities identified therein. Management continues to interpret the contractual obligation due from our Former Parent and its controlled entities as due in full. The asset write down was recorded within Other operating income (expense), net within the Interim condensed consolidated statement of operations during the year ended December 31, 2018. Although the claim has uncertainty of collectability, the Company will continue to vigorously defend its claim for the full value of the indemnity, including the filing of formal legal claims as necessary. | Note 16: Commitments and Contingencies Lawsuits and Legal Claims The Company is engaged in various legal proceedings, claims, audits and investigations that have arisen in the ordinary course of business. These matters include, but are not limited to, antitrust/competition claims, intellectual property infringement claims, employment matters and commercial matters. The outcome of all of the matters against the Company is subject to future resolution, including the uncertainties of litigation. Based on information currently known to the Company and after consultation with outside legal counsel, management believes that the ultimate resolution of any such matters, individually or in the aggregate, will not have a material impact on the Company’s financial condition taken as a whole. Contingent Liabilities In conjunction with the acquisition of Publons, the Company agreed to pay former shareholders up to an additional $9,500 through 2020. Amounts payable are contingent upon Publons’ achievement of certain milestones and performance metrics. The Company had an outstanding liability for $4,445 and $2,960 related to the estimated fair value of this contingent consideration as of September 30, 2019 and December 31, 2018, respectively. The outstanding balance consisted of $4,445 and $1,600 included in Accrued expenses and other current liabilities, and $0 and $1,360 included in Other non-current liabilities in the Interim Condensed Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018, respectively. In conjunction with the acquisition of TrademarkVision that occurred on October 25, 2018, the Company agreed to pay former shareholders a potential earn-out dependent upon achievement of certain milestones and financial performance metrics through 2020. Amounts payable are contingent upon TrademarkVision’s achievement of certain milestones and performance metrics. As of September 30, 2019 and December 31, 2018, the Company had an outstanding liability for $7,715 and $4,115 respectively, related to the estimated fair value of this contingent consideration. The outstanding balance was included in Accrued expenses and other current liabilities as of September 30, 2019, and in Other non-current liabilities as of December 31, 2018, in the condensed consolidated balance sheets. Tax Indemnity In connection with the 2016 Transaction, the Company recorded certain tax indemnification assets pursuant to the terms of the separation and indemnified liabilities identified therein. The asset write down was recorded within Other operating income (expense), net within the Interim Condensed Consolidated Statement of Operations during the year ended December 31, 2018. Legal Settlement In September 2019, the Company settled a confidential claim that resulted in a gain. The net gain was recorded in Legal settlement within the Interim Condensed Consolidated Statement of Operations during the three and nine months ended September 30, 2019. | Note 19: Commitments and Contingencies The Company does not have any recorded or unrecorded guarantees of the indebtedness of others. Contingencies Lawsuits and Legal Claims The Company is engaged in various legal proceedings, claims, audits and investigations that have arisen in the ordinary course of business. These matters include, but are not limited to, antitrust/competition claims, intellectual property infringement claims, employment matters and commercial matters. The outcome of all of the matters against the Company is subject to future resolution, including the uncertainties of litigation. Based on information currently known to the Company and after consultation with outside legal counsel, management believes that the ultimate resolution of any such matters, individually or in the aggregate, will not have a material impact on the Company’s financial condition taken as a whole. Contingent Liabilities In conjunction with the acquisition of Publons, the Company agreed to pay former shareholders up to an additional $9,500 through 2020. Amounts payable are contingent upon Publons’ achievement of certain milestones and performance metrics. The Company paid $2,470 of the contingent purchase price in the year ended December 31, 2018, as a result of Publons achieving the first tier of milestones and performance metrics. The Company had an outstanding liability for $2,960 and $5,900 related to the estimated fair value of this contingent consideration as of December 31, 2018 and 2017, respectively. The outstanding balance consisted of $1,600 and $2,250 included in Accrued expenses and other current liabilities, and $1,360 and $3,650 included in Other non-current liabilities in the Consolidated Balance Sheets as of December 31, 2018 and 2017 respectively. In conjunction with the acquisition of Kopernio, the Company agreed to pay former shareholders up to an additional $3,500 through 2021. Amounts payable are contingent upon Kopernio’s achievement of certain milestones and performance metrics and will be recognized over the concurrent service period. In conjunction with the acquisition of TrademarkVision, the Company agreed to pay former shareholders a potential earn-out dependent upon achievement of certain milestones and financial performance metrics through 2020. Amounts payable are contingent upon TrademarkVision’s achievement of certain milestones and performance metrics. As of December 31, 2018, the Company had an outstanding liability for $4,115 related to the estimated fair value of this contingent consideration, of which $4,115 was included in Other non-current liabilities in the Consolidated Balance Sheets. Tax Indemnity In connection with the 2016 Transaction, the Company recorded certain tax indemnification assets pursuant to the terms of the separation and indemnified liabilities identified therein. As a result of counterparty dispute related to certain of the indemnification claims, the Company wrote off $33,819 accumulated foreign currency impacts. Management continues to interpret the contractual obligation due from Former Parent and its controlled entities (“Thomson Reuters”) as due in full. The asset write down was recorded within Other operating income (expense), net within the Consolidated Statement of Operations. Although the claim has uncertainty of collectability, the Company will continue to vigorously defend its claim for the full value of the indemnity, including the filing of formal legal claims as necessary. Commitments Leases The Company enters into operating leases in the ordinary course of business, primarily for real property and equipment. Payments for these leases are contractual obligations as scheduled per each agreement. Total rental expense under operating leases amounted to $25,527 for the year ended December 31, 2018. The total rental expense under operating leases amounted to $17,255 for the year ended December 31, 2017. The future aggregate minimum lease payments as of December 31, 2018 under all non-cancelable operating leases for the years noted are as follows: Year ended December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 In connection with certain leases, the Company guarantees the restoration of the leased property to a specified condition after completion of the lease period. As of December 31, 2018 and 2017, the liability of $4,100 and $4,200, respectively, associated with these restorations is recorded within other liabilities. There were no material future minimum sublease payments to be received under non-cancelable subleases at December 31, 2018. There was no material sublease income as of December 31, 2018 and 2017, respectively. Unconditional purchase obligations Purchase obligations are defined as agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms, including fixed or minimum quantities to be purchased, fixed, minimum or variable pricing provisions and the approximate timing of the transactions. The Company has various purchase obligations for materials, supplies, outsourcing and other services contracted in the ordinary course of business. These items are not recognized as liabilities in our consolidated financial statements but are required to be disclosed. The contractual terms of these purchase obligations extend through 2021. The Company paid $71,859 towards these purchase obligations during the year ended December 31, 2018. The future unconditional purchase obligations as of December 31, 2018 are as follows: Year ended December 31, 2019 $ 34,321 2020 24,370 2021 8,151 2022 13 Total $ 66,855 |
Related Party and Former Parent
Related Party and Former Parent Transactions | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Related Party and Former Parent Transactions | |||
Related Party and Former Parent Transactions | Note 19: Related Party and Former Parent Transactions Onex Partners Advisor LP (“Onex”), an affiliate of the Company, is considered a related party. Concurrent with the Acquisition, the Company entered into a Consulting Services Agreement with Onex, pursuant to which the Company is provided certain ongoing strategic and financing consulting services in exchange for a quarterly management fee. In connection with this agreement, the Company recognized $158 and $208 for the three months ended June 30, 2019, and 2018, respectively, and $389 and $416 for the six months ended June 30, 2019 and 2018, respectively. The Company pays 0.1% interest per annum to Onex for the Credit Agreement. The Company recognized $112 and $226 for the three months ended June 30, 2019 and 2018, respectively, and $327 and $452 for the six months ended June 30, 2019 and 2018, respectively, in interest expense for the Onex related interest. The Company had an outstanding liability of $51 and $450 to Onex as of June 30, 2019, and December 31, 2018, respectively. In addition, the Company paid Onex a management fee of $5,400 in connection with the Transactions. See Note 4 — “The Transactions” for additional information. BPEA, an affiliate of the Company, is considered a related party. Concurrent with the Acquisition, the Company entered into a Management Services Agreement with BPEA, pursuant to which the Company is provided certain ongoing strategic and financing consulting services. In connection with this agreement, the Company recognized $79 and $167 for the three months ended June 30, 2019, and 2018, respectively, and $246 and $334 for the six months ended June 30, 2019, and 2018, respectively, in operating expenses related to this agreement. The Company had an outstanding liability of $79 and $334 to BPEA as of June 30, 2019, and December 31, 2018, respectively. In addition, the Company paid Baring a management fee of $2,100 in connection with the Transactions. See Note 4 — “The Transactions” for additional information. At the completion of the Transactions, we recorded an initial liability of $264,600 payable to the TRA Parties under the TRA. To date, there has been no expense recorded under the TRA. See Note 15 — “Tax Receivable Agreement” for further details. In connection with the 2016 Transaction, Bidco and a subsidiary of the Former Parent entered into the Transition Service Agreement, which became effective on October 3, 2016, pursuant to which such subsidiary of the Former Parent will, or will cause its affiliates and/or third-party service providers to, provide Bidco, its affiliates and/or third-party service providers with certain technology, facilities management, human resources, sourcing, financial, accounting, data management, marketing and other services to support the operation of the IP&S business as an independent company. Such services are provided by such subsidiary of the Former Parent or its affiliates and/or third-party service providers for various time periods and at various costs based upon the terms set forth in the Transition Service Agreement. A controlled affiliate of Baring is a vendor of ours. Total payments to this vendor were $78 and $59 for the three months ended June 30, 2019 and 2018 respectively, and $318 and $288 for the six months ended June 30, 2019, and 2018, respectively. The Company had an outstanding liability of $145 and $120 as of June 30, 2019 and December 31, 2018, respectively. One member of our key management is the Co-founder of a vendor of ours. Total payments to this vendor were $200 and $278 for the three and six months ended June 30, 2019, and the Company had no outstanding liability as of June 30, 2019. This vendor was not a related party during the three and six months ended June 30, 2018. | Note 19: Related Party and Former Parent Transactions Onex Partners Advisor LP (“Onex”), an affiliate of the Company, is considered a related party. Concurrent with the Acquisition, the Company entered into a Consulting Services Agreement with Onex, pursuant to which the Company is provided certain ongoing strategic and financing consulting services in exchange for a quarterly management fee. In connection with this agreement, the Company recognized $30 and $208 for the three months ended September 30, 2019, and 2018, respectively, and $419 and $624 for the nine months ended September 30, 2019 and 2018, respectively. The Company pays 0.1% interest per annum to Onex for the Credit Agreement. The Company recognized $0 and $223 for the three months ended September 30, 2019 and 2018, respectively, and $327 and $675 for the nine months ended September 30, 2019 and 2018, respectively, in interest expense for the Onex related interest. The Company had an outstanding liability of $30 and $450 to Onex as of September 30, 2019, and December 31, 2018, respectively. In addition, the Company paid Onex a management fee of $5,400 in connection with the Transactions in the second quarter of 2019. See Note 4 — “The Transactions” for additional information. BPEA, an affiliate of the Company, is considered a related party. Concurrent with the Acquisition, the Company entered into a Management Services Agreement with BPEA, pursuant to which the Company is provided certain ongoing strategic and financing consulting services. In connection with this agreement, the Company recognized $0 and $167 for the three months ended September 30, 2019, and 2018, respectively, and $246 and $501 for the nine months ended September 30, 2019, and 2018, respectively, in operating expenses related to this agreement. The Company had an outstanding liability of $0 and $334 to BPEA as of September 30, 2019, and December 31, 2018, respectively. In addition, the Company paid BPEA a management fee of $2,100 in connection with the Transactions in the second quarter of 2019. See Note 4 — “The Transactions” for additional information. At the completion of the Transactions, we recorded an initial liability of $264,600 payable to the TRA Parties under the TRA. To date, there has been no activity recorded under the TRA. See Note 15 — “Tax Receivable Agreement” for further details. In connection with the 2016 Transaction, Bidco and a subsidiary of the Former Parent entered into the Transition Service Agreement, which became effective on October 3, 2016, pursuant to which such subsidiary of the Former Parent will, or will cause its affiliates and/or third-party service providers to, provide Bidco, its affiliates and/or third-party service providers with certain technology, facilities management, human resources, sourcing, financial, accounting, data management, marketing and other services to support the operation of the IP&S business as an independent company. Such services are provided by such subsidiary of the Former Parent or its affiliates and/or third-party service providers for various time periods and at various costs based upon the terms set forth in the Transition Service Agreement. A controlled affiliate of Baring is a vendor of ours. Total payments to this vendor were $126 and $59 for the three months ended September 30, 2019 and 2018 respectively, and $444 and $288 for the nine months ended September 30, 2019, and 2018, respectively. The Company had an outstanding liability of $166 and $120 as of September 30, 2019 and December 31, 2018, respectively. Jerre Stead, Chief Executive Officer of the Company, is the Co-founder of a vendor of ours. Total payments to this vendor were $481 for the three and nine months ended September 30, 2019, respectively, and the Company had no outstanding liability as of September 30, 2019. This vendor was not a related party during the three and nine months ended September 30, 2018. A former member of our key management is the Co-founder of a vendor of ours. Total payments to this vendor were $0 and $278 for the three and nine months ended September 30, 2019, and the Company had no outstanding liability as of September 30, 2019. This vendor was not a related party during the three and nine months ended September 30, 2018. | Note 20: Related Party and Former Parent Transactions Onex Partners Advisor LP (“Onex”), an affiliate of the Company, is considered a related party. Concurrent with the 2016 Transaction, the Company entered into a Consulting Services Agreement with Onex, pursuant to which the Company is provided certain ongoing strategic and financing consulting services in exchange for a quarterly management fee. In connection with this agreement, the Company recognized $920 and $1,230 in operating expenses related to this agreement for the years ended December 31, 2018 and 2017, respectively. As noted in Note 12 — Debt, the Company pays 0.1% interest per annum to Onex for the Prior Credit Agreement. For the years ended December 31, 2018 and 2017, the Company recognized interest expense, for Onex related interest, of $905 and $1,557, respectively. The Company had an outstanding liability of $450 and $162 to Onex as of December 31, 2018 and 2017, respectively. Baring, an affiliate of the Company, is considered a related party. Concurrently with the 2016 Transaction, the Company entered into a Management Services Agreement with Baring, pursuant to which the Company is provided certain ongoing strategic and financing consulting services. In connection with this agreement, the Company recognized $669 and $854 in operating expenses related to this agreement for the years ended December 31, 2018 and 2017, respectively. The Company had an outstanding liability of $334 and $641 to Baring as of December 31, 2018 and 2017, respectively. The fees to Onex and Baring were negotiated at a rate that management believes is appropriate and reasonable for the value of the services being provided, and is commensurate with the fee that would be charged by independent third parties for similar services. In connection with the 2016 Transaction, Bidco and a subsidiary of the Former Parent entered into the Transition Service Agreement, which became effective on October 3, 2016, pursuant to which such subsidiary of the Former Parent will, or will cause its affiliates and/or third-party service providers to, provide Bidco, its affiliates and/or third-party service providers with certain technology, facilities management, human resources, sourcing, financial, accounting, data management, marketing and other services to support the operation of the IP&S business as an independent company. Such services are provided by such subsidiary of the Former Parent or its affiliates and/or third-party service providers for various time periods and at various costs based upon the terms set forth in the Transition Service Agreement. In connection with the acquisition of Publons, the Company paid a $716 consulting fee for the year ended December 31, 2017, which is included in Transaction expenses, to a former member of its Board of Directors. A controlled affiliate of Baring is a vendor of ours. Total payments to this vendor were $531 and $388 for the years ended December 31, 2018 and 2017, respectively. The Company had an outstanding liability of $120 and $199 as of December 31, 2018 and 2017, respectively. One member of our key management is the Co-founder of a vendor of ours. Total payments to this vendor were $865 for the year ended December 31, 2018 and the Company had an outstanding liability of $332 as of December 31, 2018. This vendor was not a related party in 2017. |
Subsequent Events
Subsequent Events | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Subsequent Events | |||
Subsequent Events | Note 20: Subsequent Events Management has evaluated the impact of events that have occurred subsequent to June 30, 2019. Based on this evaluation, other than as recorded or disclosed within these interim condensed consolidated combined financial statements and related notes, the Company has determined no other events were required to be recognized or disclosed. | Note 20: Subsequent Events Management has evaluated the impact of events that have occurred subsequent to September 30, 2019. Based on this evaluation, other than disclosed within these interim condensed consolidated combined financial statements and related notes or described below, the Company has determined no other events were required to be recognized or disclosed. On October 31, 2019, Camelot Finance S.A., an indirect wholly owned subsidiary of the Company, completed the offering of $700,000 in aggregate principal of its 4.50% Senior Secured Notes due 2026 (the "2026 Notes"). In connection with completion of the 2026 Notes offering, Camelot Finance S.A. entered into a new Senior Credit Facility, which provided $900,000 in Term Loan Borrowings (the "2019 Term Loan Facility") at a rate of Libor plus 3.25% and a $250,000 revolving line of credit (the "2019 Revolving Credit Facility") which is available to fund working capital and other general corporate needs. The 2019 Term Loan Facility was drawn down in full at inception effective October 2019. The Company used the proceeds from the 2026 Notes offering, together with borrowings under the New Term Loan Facility, to redeem the existing 7.875% Senior Secured Notes, refinance outstanding borrowings of $846,320 on the existing Term Loan Facility, and pay fees and expenses associated with the refinancing of $20,000. In addition, the Company intends to use the remaining proceeds to meet its obligation to pay $200,000 under the TRA Buyout Agreement. After these uses of funds, the Company expects to have a net $12,000 in additional cash on hand as a result of the refinancing activity. Per 2019 Revolving Credit Facility, the Company will be required to maintain a maximum total first lien net leverage ratio not in excess of 7.25 to 1.00. This springing covenant must be tested on the last day of any quarter where more than 35% of the 2019 Revolving Credit Facility (excluding (i) up to $20,000 in undrawn letters of credit and (ii) any cash collateralized letters of credit) is utilized at such date. On November 3, 2019, the Company entered into an agreement with an unrelated third-party for the sale of certain assets and liabilities of its MarkMonitor business within its IP Group. The divestment is expected to close during the fourth quarter of 2019 for a consideration of approximately $5,000, subject to adjustments as defined in the Sales and Purchase Agreement, subject to typical working capital adjustments, and the Company expects to incur a book loss in the range of $5,000 to $15,000. As of September 30, 2019, the Company determined that no impairment existed and that these assets did not meet the criteria to be classified as held for sale and accordingly its results are presented with continuing operations. | Note 21: Subsequent Events On January 14, 2019, the Company entered into a definitive agreement to merge with Churchill Capital Corporation (“Churchill”), a public investment vehicle listed on the New York Stock Exchange (Ticker: CCC). An amendment to this agreement was executed effective February 26, 2019. The Company’s existing shareholders will retain 100% of their equity, which converts to 73.8% ownership of the outstanding shares of the combined company at closing, assuming no redemptions by Churchill’s public stockholders. The remaining outstanding shares of the combined company will be held by the current stockholders and founders of Churchill. The transaction is expected to be completed during the second quarter of 2019, subject to approval by Churchill stockholders and other customary closing conditions. The combined company will be called Clarivate Analytics. Prior to the consummation of the merger, Clarivate will enter into a tax receivable agreement with its current equity holders, which will provide for the sharing of tax benefits relating to certain pre-business combination tax attributes as those tax benefits are realized by Clarivate. Under the Tax Receivable Agreement, the aggregate reduction in income taxes payable will be computed by comparing the actual tax liability of Camelot Holdings (Jersey) Limited and its subsidiaries with the estimated tax liability of applicable entities had such entities not been able to utilize the Covered Tax Assets, taking into account several assumptions including, for example, that the relevant entities will pay U.S. state and local taxes at a rate of 7%, the tax assets existing at the time of the Company’s entry into the Tax Receivable Agreement are deemed to be utilized and give rise to a tax savings before certain other tax benefits, and certain asset or equity transfers by certain of the Company’s subsidiaries will be treated under the Tax Receivable Agreement as giving rise to tax benefits associated with the Covered Tax Assets implicated by such asset or equity transfers. Payments under the Tax Receivable Agreement will generally be made annually in cash, and the amounts payable will be subject to interest from the due date (without extensions) of the applicable tax filing that reflects a covered savings until the payment under the Tax Receivable Agreement is made. Tax Receivable Agreement payments are expected to commence in 2021 (with respect to taxable periods ending in 2019) and will be subject to deferral, at the Company’s election, for payment amounts in excess of $30 million for payments to be made in 2021 and 2022, but will not be subject to deferral thereafter. Amounts deferred under the preceding sentence will accrue interest until paid in accordance with the terms of the Tax Receivable Agreement. The Tax Receivable Agreement is subject to certain events of default that may give rise to an acceleration of the Company’s obligations under the Tax Receivable Agreement. The amount and timing of Tax Receivable Agreement payments, however, may vary based on a number of factors, including the amount, character and timing of our subsidiaries’ taxable income in the future, and any successful challenges to our tax positions. Consequently, we are unable to reliably estimate the timing or amount of payments expected to be made under the Tax Receivable Agreement. Through January 31, 2019, management paid down $15,000 of the $45,000 outstanding Prior Revolving Credit Facility balance as of December 31, 2018. Management has evaluated the impact of events that have occurred subsequent to December 31, 2018 through February 26, 2019, which is the date the financial statements were available for issuance. Based on this evaluation, other than as recorded or disclosed within these consolidated financial statements and related notes, the Company has determined no other events were required to be recognized or disclosed. |
Subsequent Events (unaudited)
Subsequent Events (unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events (unaudited) | |
Subsequent Events (unaudited) | Note 22: Subsequent Events (unaudited) On May 13, 2019, the Company completed its merger with Churchill creating the newly merged entity, Clarivate Analytics Plc ("Clarivate"). Upon completion of the merger, available cash increased by approximately $682,087 and the ordinary shares and warrants of the newly merged entity began trading on the NYSE and NYSE American, respectively. The Merger was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Churchill was treated as the "acquired" company for financial reporting purposes. Pursuant to the Merger Agreement, the aggregate stock consideration issued by the Company was $3,052,500, consisting of 305,250,000 newly issued ordinary shares of the Company valued at $10.00 per share, subject to certain adjustments described below. At the closing of the Transactions, the Company Owners held approximately 74% of the issued and outstanding ordinary shares of the Company and stockholders of Churchill held approximately 26% of the issued and outstanding shares of the Company excluding the impact of (i) 52,800,000 warrants, (ii) approximately 24,806,793 compensatory options issued to the Company's management (based on the number of options to purchase Jersey ordinary shares outstanding immediately prior to the Transactions, after giving effect to the exchange ratio described above) and (iii) 10,600,000 ordinary shares of Clarivate owned of record by the sponsor and available for distribution to certain individuals following the applicable lock-up and vesting restrictions. After giving effect to the satisfaction of the vesting restrictions, the Company Owners held approximately 71% of the issued and outstanding shares of the Company at the closing of the Transactions. A non-recurring stock compensation charge of $25,013 was recognized in the second quarter of 2019 in connection with vesting and lock-up conditions attached to certain stock owned by former Churchill shareholders. Upon completion of the Merger, Clarivate Analytics Plc made voluntary prepayments of $630,000 toward the Company's Prior Term Loan Facility and $20,000 toward the Company's Prior Revolving Credit Facility. In addition, there was a write down of deferred financing charges and original issue discount on the Term Loan in proportion to the principal paydown. These write downs of $7,718 in deferred financing fees and $1,406 in original issue discount were recognized in interest expense in the second quarter of 2019. During the six months ended June 30, 2019, the Company had previously paid down an additional $30,000 drawn on the Prior Revolving Credit Facility. In April 2019, the Company entered into additional interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $50,000 of its outstanding Term Loan, effective April 30, 2021. Additionally, in May 2019, the Company entered into additional interest rate swap arrangements with counterparties to reduce its exposure to variability in cash flows relating to interest payments on $100,000 of its outstanding Term Loan, effective March 31, 2021. These hedging instruments mature on September 29, 2023. The Company applies hedge accounting by designating the interest rate swaps as a hedge in applicable future quarterly interest payments. Prior to the consummation of the Merger, Clarivate entered into a tax receivable agreement (the "TRA") with its current equity holders, which provides for the sharing of tax benefits relating to certain pre-business combination tax attributes as those tax benefits are realized by Clarivate. At the completion of the Transactions, Clarivate recorded an initial liability of $264,600, representing approximately 85% of the calculated tax savings based on the portion of covered tax assets Clarivate anticipates being able to utilize in future years. Total payments related to the TRA would be up to a maximum of $507,326 if all covered tax assets are utilized. On August 21, 2019, Clarivate Analytics Plc entered into an agreement with the pre-Merger shareholders ("Buyout Agreement") whereby Clarivate agreed to use commercially reasonable efforts to finance, on terms satisfactory to the Company and in its sole discretion, the settlement of the TRA for a cash payment of $200,000 prior to December 31, 2019. In the event the $200,000 cash payment has not been made by December 31, 2019, the Buyout Agreement will terminate unless mutually extended by the parties to the agreement and the terms of the original TRA will remain in full effect. On August 14, 2019, the Board of Directors of Clarivate Analytics (the "BoD") approved the waiver of the lock-up period set forth in the Amended and Restated Shareholders Agreement dated January 14, 2019 which generally restricted Onex and Baring from selling their shareholdings in Clarivate Analytics Plc during the period ending on November 9, 2019. In addition, the BoD approved the waiver of various time and market vesting conditions, but not the lock-up provisions, on 17,250,000 ordinary shares and 17,265,826 private placement warrants specific to the Founders as defined in the Amended and Restated Shareholders Agreement. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Summary of Significant Accounting Policies | |||
Business combinations | Business combinations The Company determines whether substantially all the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If this threshold is met, the set is not a business. If it is not met, the Company then evaluates whether the set meets the requirement that a business include, at a minimum, an input and as substantive process that together significantly contribute to the ability to create outputs. Business combinations are accounted for using the acquisition method at the acquisition date, which is when control is obtained. The consideration transferred is generally measured at fair value, as are the identifiable assets acquired and liabilities assumed. During the one-year period following the acquisition date, if an adjustment is identified based on new information about facts and circumstances that existed as of the acquisition date, the Company will record measurement-period adjustments related to the acquisitions in the period in which the adjustment is identified. Goodwill is measured at the acquisition date as the fair value of the consideration transferred (including, if applicable, the fair value of any previously held equity interest and any non-controlling interests) less the net recognized amount (which is generally the fair value) of the identifiable assets acquired and liabilities assumed. Transaction costs, other than those associated with the issuance of debt or equity securities incurred in connection with a business combination, are expensed as incurred and included in Transaction expenses in the Consolidated Statements of Operations. | ||
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts and operations of the Company, and its subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. | ||
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. The most important of these relate to share-based compensation expenses, revenues recognition, the allowance for doubtful accounts, internally developed computer software, valuation of goodwill and other identifiable intangible assets, determination of the projected benefit obligations of the defined benefit plans, income taxes, fair value of stock options, derivatives and financial instruments, contingent earn-out, and the tax related valuation allowances. On an ongoing basis, management evaluates these estimates, assumptions and judgments, in reference to historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. | ||
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents is comprised of cash on hand and short-term deposits with an original maturity at the date of purchase of three months or less. | ||
Restricted Cash | Restricted Cash As of December 31, 2017, the Company’s restricted cash primarily related to funds the Company has received from customers in advance of paying patent renewals on behalf of those customers. This activity was specific to the IPM Product Line, which was sold on October 1, 2018 (See Note 5: Divested Operations, for further details), and was $0 at December 31, 2018. | ||
Accounts Receivable | Accounts Receivable Accounts receivable are presented net of the allowance for doubtful accounts and any discounts. Accounts receivable are recorded at the invoiced amount and do not bear interest. Collections of accounts receivable are included in cash provided by operating activities in the Consolidated Statements of Cash Flows. The Company maintains an allowance for doubtful accounts for estimated losses and assesses its adequacy each reporting period by evaluating factors such as the length of time receivables are past due, historical collection experience, and the economic and competitive environment. The expense related to doubtful accounts is included within Selling, general and administrative costs, excluding depreciation and amortization in the Consolidated Statements of Operations. Account balances are written off against the allowance when the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. | ||
Concentration of Credit Risk | Concentration of Credit Risk Accounts receivable are the primary financial instrument that potentially subjects the Company to significant concentrations of credit risk. Account receivable represents arrangements in which services were transferred to a customer before the customer pays consideration or before payment is due. Contracts with payment in arrears are recognized as receivables after the Company considers whether a significant financing component exists. The Company does not require collateral or other securities to support customer receivables. Management performs ongoing credit evaluations of its customers’ financial condition and limits the amount of credit extended when deemed appropriate. Credit losses have been immaterial and reasonable within management’s expectations. No single customer accounted for more than 1% of revenues and our ten largest customers represented only 6% of revenues for the year ended December 31, 2018. The Company maintains its cash and cash equivalent balances with high-quality financial institutions and consequently, the Company believes that such funds are subject to minimal credit risk. | ||
Prepaid Assets | Prepaid Assets Prepaid assets represent amounts that the Company has paid in advance of receiving benefits or services. Prepaid assets include amounts for system and service contracts, sales commissions, deposits, prepaid royalties and insurance and are recognized as an expense over the general contractual period that the Company expects to benefit from the underlying asset or service. | ||
Computer Hardware and Other Property | Computer Hardware and Other Property Generally, computer hardware and other property are recorded at cost and are depreciated over the respective estimated useful lives. Upon the 2016 Transaction, computer hardware and other property were revalued and recorded at net book value, which approximated fair value at the 2016 Transaction. Depreciation is computed using the straight-line method. Repair and maintenance costs are expensed as incurred. The cost and related accumulated depreciation of sold or retired assets are removed from the accounts and any gain or loss is included within loss from operations in the Consolidated Statements of Operations. The estimated useful lives are as follows: Computer hardware 3 years Furniture, fixtures and equipment 5 – 7 years Leasehold improvements Lesser of lease term or estimated useful life | ||
Computer Software | Computer Software Development costs related to internally generated software are capitalized once a project has progressed beyond a conceptual, preliminary stage to that of the application development stage. Costs of significant improvements on existing software for internal use, both internally developed and purchased, are also capitalized. Costs related to the preliminary project stage, data conversion and post implementation/ operation stage of an internal use software development project are expensed as incurred. Capitalized costs are amortized over five years, which is the estimated useful life of the related software. Purchased software is amortized over three years, which is the estimated useful life of the related software. The capitalized amounts, net of accumulated amortization, are included in Identifiable intangible assets, net in the Consolidated Balance Sheets. The cost and related accumulated amortization of sold or retired assets are removed from the accounts and any gain or loss is included in operating expense. Computer software is evaluated for impairment whenever circumstances indicate the carrying amount may not be recoverable. The test for impairment compares the carrying amounts with the sum of undiscounted cash flows related to the asset. If the carrying value is greater than the undiscounted cash flows of the asset, the asset is written down to its estimated fair value. | ||
Identifiable Intangible Assets, net | Identifiable Intangible Assets, net Upon acquisition, identifiable intangible assets are recorded at fair value and are carried at cost less accumulated amortization or accumulated impairment for indefinite-lived intangible assets. Useful lives are reviewed at the end of each reporting period and adjusted if appropriate. Fully amortized assets are retained in cost and accumulated amortization accounts until such assets are derecognized. Customer Relationships — Customer relationships primarily consist of customer contracts and customer relationships arising from such contracts. Databases and Content — Databases and content primarily consists of repositories of the Company’s specific financial and customer information, and intellectual content. Trade Names — Trade names consist of purchased brand names that the Company continues to use. Where applicable, intangible assets are amortized on a straight-line basis over their estimated useful lives as follows: Customer relationships 2 – 4 years Databases and content 13 – 20 years Trade Names Indefinite | ||
Impairment of Long-lived Assets | Impairment of Long-Lived Assets Residual values and useful lives are reviewed at the end of each reporting period and adjusted if appropriate. The Company evaluates its long-lived assets, including computer hardware and other property, computer software, and finite-lived intangible assets for impairment whenever circumstances indicate that their carrying amounts may not be recoverable. Recoverability of these assets is measured by comparison of the carrying amount of each asset to the future undiscounted cash flows the asset is expected to generate over its remaining life. An asset is assessed for impairment at the lowest level that the asset generates cash inflows that are largely independent of cash inflows from other assets. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. Management determined that no impairment existed for any of the periods presented. | ||
Goodwill and Indefinite-Lived Intangible Assets | Goodwill and Indefinite-Lived Intangible Assets The Company evaluates its goodwill for impairment at the reporting unit level, defined as an operating segment or one level below an operating segment, annually as of October 1 or more frequently if impairment indicators arise in accordance with ASC Topic 350. The Company identified one reporting unit for the year ended December 31, 2017 and five reporting units due to a change in the Company’s reporting structure for the year ended December 31, 2018. The Company evaluates the recoverability of goodwill using a two-step impairment test approach at the reporting unit level. In the first step, the Company assesses various qualitative factors to determine whether the fair value of a reporting unit may be less than its carrying amount. If a determination is made that, based on the qualitative factors, an impairment does not exist, the Company is not required to perform further testing. If the aforementioned qualitative assessment results in the Company concluding that it is more likely than not that the fair value of a reporting unit may be less than its carrying amount, the fair value of the reporting unit will be determined and compared to its carrying value including goodwill. In determining the fair value of a reporting unit, the Company estimates the fair value of a reporting unit using the fair value derived from the income approach, which is a change from the previous year which used a market approach. The market approach estimates fair value based on market multiples of revenues and earnings derived from comparable publicly-traded companies with similar operating and investment characteristics as the reporting unit; whereas, the income approach uses a discounted cash flow (“DCF”) model. The DCF model determines the fair value of our reporting units based on projected future discounted cash flows, which in turn were based on our views of uncertain variables such as growth rates, anticipated future economic conditions, and the appropriate discount rates relative to risk and estimates of residual values. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is not impaired and the Company is not required to perform further testing. If the fair value of the reporting unit is less than the carrying value, the Company will recognize the difference as an impairment charge. Management concluded that no goodwill impairment existed for any of the periods presented. The Company also has indefinite-lived intangible assets related to trade names. Indefinite-lived intangible assets are subject to impairment testing annually or whenever events or changes in circumstances indicate that their carrying value may not be recoverable. For purposes of impairment testing, the fair value of trade names is determined using an income approach, specifically the relief from royalties method. Management concluded that no indefinite-lived intangible impairment existed for any of the periods presented. | ||
Other Current and Non-Current Assets and Liabilities | Other Current and Non-Current Assets and Liabilities The Company defines current assets and liabilities as those from which it will benefit from or which it has an obligation for within one year that do not otherwise classify as assets or liabilities separately reported on the Consolidated Balance Sheets. Other non-current assets and liabilities are expected to benefit the Company or cause its obligation beyond one year. The Company classifies the current portion of long-term assets and liabilities as current assets or liabilities. | ||
Leases | Lease Accounting We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities on our interim condensed consolidated balance sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are accounted as a single lease component. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. | Lease Accounting We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities on our Interim Condensed Consolidated Balance Sheets. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are accounted as a single lease component. Additionally, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease ROU assets and liabilities. | Leases Leases are classified as either operating or capital, based on the substance of the transaction at inception of the lease. Classification is re-assessed if the terms of the lease are changed. Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments under an operating lease (net of any incentives received from the lessor) are recognized in the Consolidated Statements of Operations on a straight-line basis over the period of the lease. The Company does not currently have any capital leases. |
Accounts Payable and Accruals | Accounts Payable and Accruals Accounts payable and accruals are obligations to pay for goods or services that have been acquired in the ordinary course of business. Accounts payable and accruals are recognized initially at their settlement value, and are classified as current liabilities if payment is due within one year or less. | ||
Debt | Debt Debt is recognized initially at par value, net of any applicable discounts or financing costs. Debt is subsequently stated at amortized cost with any difference between the proceeds (net of transactions costs) and the redemption value recognized in the Consolidated Statements of Operations over the term of the debt using the effective interest method. Interest on indebtedness is expensed as incurred. Debt is classified as a current liability when due within 12 months after the end of the reporting period. | ||
Derivative Financial Instruments | Derivative Financial Instruments Foreign Exchange Derivative Contracts Prior to the sale of IPM, the Company used derivative financial instruments to manage foreign currency exchange rate risk in IPM. The Company’s derivative financial instruments consist of foreign currency forward contracts (“forward contracts”). Derivative financial instruments were neither held nor issued by the Company for trading purposes. Interest Rate Swaps The Company has interest rate swaps with counterparties to reduce its exposure to variability in cash flows relating to interest payments on a portion of its outstanding first lien senior secured term loan facility in an aggregate principal amount of $1,550,000 (“Term Loan Facility”). The Company applies hedge accounting and has designated these instruments as cash flow hedges of the risk associated with floating interest rates on designated future quarterly interest payments. Management assumes the hedge is highly effective and therefore changes in the value of the hedging instrument are recorded in Accumulated other comprehensive income in the Consolidated Balance Sheets. Any ineffectiveness is recorded in earnings. Amounts in Accumulated other comprehensive income (loss) are reclassified into earnings in the same period during which the hedged transactions affect earnings, or upon termination of the hedging relationship. | ||
Fair Value of Financial Instruments | Fair Value of Financial Instruments In determining fair value, the use of various valuation methodologies, including market, income and cost approaches is permissible. The Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability. The accounting guidance for fair value measurements establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value based on the reliability of inputs. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The Company’s interest rate swap derivative instruments are classified as Level 2. Earn-out liabilities and defined benefit plan assets are classified as Level 3. | ||
Contingent Considerations | Contingent Considerations The Company records liabilities for the estimated cost of such contingencies when expenditures are probable and reasonably estimable. A significant amount of judgment is required to estimate and quantify the potential liability in these matters. We engage outside experts as deemed necessary or appropriate to assist in the calculation of the liability, however management is responsible for evaluating the estimate. As information becomes available regarding changes in circumstances for ongoing contingent considerations, our potential liability is reassessed and adjusted as necessary. See Note 19 — Commitments and Contingencies for further information on contingencies. | ||
Pension and Other Post-Retirement Benefits | Pension and Other Post-Retirement Benefits The Company may be required to sponsor pension benefit plans, for certain international markets, which are unfunded and are not significant for the Company. The net periodic pension expense is actuarially determined on an annual basis by independent actuaries using the projected unit credit method. The determination of benefit expense requires assumptions such as the discount rate, which is used to measure service cost, benefit plan obligations and the interest expense on the plan obligations. Other significant assumptions include expected mortality, the expected rate of increase with respect to future compensation and pension. Because the determination of the cost and obligations associated with employee future benefits requires the use of various assumptions, there is measurement uncertainty inherent in the actuarial valuation process. Actual results will differ from results which are estimated based on assumptions. The liability recognized in the Consolidated Balance Sheet is the present value of the defined benefit obligation at the end of the reporting period. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid and that have terms to maturity approximating the terms of the related pension liability. The defined benefit obligation is included in Other non-current liabilities in the Consolidated Balance Sheets. All actuarial gains and losses that arise in calculating the present value of the defined benefit obligation are recognized immediately in accumulated deficit and included in the consolidated statement of comprehensive income (loss). See Note 11 — Pension and Other Post Retirement Benefits for balances and further details including an estimate of the impact on the consolidated financial statements from changes in the most critical assumptions. Employer contributions to defined contribution plans are expensed as incurred, which is as the related employee service is rendered. Certain prior year amounts have been reclassified to conform to current year presentation. | ||
Taxation | Taxation The Company recognizes income taxes under the asset and liability method. Our income tax expense, deferred tax assets and liabilities, and reserves for unrecognized tax benefits reflect our best assessment of estimated current and future taxes to be paid. Significant judgments and estimates are required in determining the consolidated income tax expense for financial statement purposes. Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, which will result in taxable or deductible amounts in the future. In assessing the realizability of deferred tax assets, we consider future taxable income by tax jurisdiction and tax planning strategies. The Company records a valuation allowance to reduce our deferred tax assets to equal an amount that is more likely than not to be realized. Changes in tax laws and tax rates could also affect recorded deferred tax assets and liabilities in the future. The calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across our global operations. Accounting Standards Codification (ASC) Topic 740, Income Taxes, states that a benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits. The Company first records unrecognized tax benefits as liabilities in accordance with ASC 740 and then adjusts these liabilities when our judgment changes as a result of the evaluation of new information not previously available at the time of establishing the liability. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from our current estimate of the unrecognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. Interest accrued related to unrecognized tax benefits and income tax related penalties are included in the provision for income taxes. Deferred tax is provided on taxable temporary differences arising on investments in foreign subsidiaries, except where we intend, and are able, to reinvest such amounts on a permanent basis. | ||
Revenue Recognition | Revenue Recognition The Company derives revenue by selling information on a subscription and single transaction basis as well as from performing professional services. The Company recognizes revenues when control of these services are transferred to the customer for an amount, referred to as the transaction price, that reflects the consideration to which the Company is expected to be entitled in exchange for those goods or services. The Company determines revenue recognition utilizing the following five steps: (1) identification of the contract with a customer, (2) identification of the performance obligations in the contract (promised goods or services that are distinct), (3) determination of the transaction price, (4) allocation of the transaction price to the performance obligations, and (5) recognition of revenues when, or as, the Company transfers control of the product or service for each performance obligation. Revenues are recognized net of discounts and rebates, as well as value added and other sales taxes. Cash received or receivable in advance of the delivery of the services or publications is included in deferred revenues. The Company disaggregates revenue based on revenue recognition pattern. Subscription based revenues are recognized over time whereas our transactional revenues are recognized at a point in time. The Company believes subscription and transaction is reflective of how the Company manages the business. The revenues recognition policies for the Company’s revenue streams are discussed below. Subscription Revenues Subscription-based revenues are recurring revenues that are earned under annual, evergreen or multi-year contracts pursuant to which we license the right to use our products to our customers. Revenues from the sale of subscription data and analytics solutions are typically invoiced annually in advance and recognized ratably over the year as revenues are earned. Subscription revenues are typically generated either on (i) an enterprise basis, meaning that the organization has a license for the particular product or service offering and then anyone within the organization can use it at no additional cost, (ii) a seat basis, meaning each individual that uses the particular product or service offering has to have his or her own license, or (iii) a unit basis, meaning that incremental revenues are generated on an existing subscription each time the product is used (e.g., a trademark or brand is searched or assessed). Transactional Revenues Transactional revenues are revenues that are earned under contracts for specific deliverables that are typically quoted on a product, data set or project basis and often derived from repeat customers, including customers that also generate subscription based revenues. Revenues from the sale of transactional products and services are invoiced according to the terms of the contract, typically in arrears. Transactional content sales are usually delivered to the customer instantly or in a short period of time, at which time revenues are recognized. In the case of professional services, these contracts vary in length from several months to years for multi-year projects and customers and typically invoices based on the achievement of milestones. Transactional revenues are typically generated on a unit basis, although for certain product and service offerings transactional revenues are generated on a seat basis. Transactional revenues may involve sales to the same customer on multiple occasions but with different products or services comprising the order. Performance Obligations Content Subscription: Content subscription performance obligations are most prevalent in the Web of Science, Derwent, and Cortellis product lines. Content subscriptions are subscriptions that can only be accessed through the Company’s on-line platform for a specified period of time through downloads or access codes. In addition to the primary content subscription, these types of performance obligations can often include other performance obligations, such as training subscriptions, access to historical content, maintenance and other optional content. While revenues for these performance obligations are primarily recognized over the length of the contract (subscription revenues) there are instances where revenues could be recognized upon delivery (transactional revenue). Historical content and some optional content can be purchased via a perpetual license, which would be recognized upon delivery. Fees are typically paid annually at the beginning of each term. Domain Registration Services: This performance obligation relates to the MarkMonitor Product Line. This is a service to register domain names with the applicable registries, with the Company being responsible for monitoring the domain name expiration and paying the registry before expiration. In addition, the Company has an ongoing responsibility to ensure the domain name is maintained at the registry. Customers typically sign a 1 – 2 year contract, identifying specific domain names to be registered and tracked. Revenue is recognized over the term of the contract and fees are typically invoiced annually at the beginning of each contract term. Search Services: This performance obligation relates to the CompuMark Product Line. It is a comprehensive search report across multiple databases for a proposed trademark. The report is compiled by Clarivate’s analysts and sent to customers. Revenues are recognized upon delivery of the report. Fees are typically paid upon delivery. Trademark Watch: This performance obligation relates to the CompuMark Product Line. Trademark watch service is an annual subscription that allows customers to protect their trademarks from infringement by providing timely notification of newly filed or published trademarks. Revenues are recognized over the term of the contract, with fees paid annually at the beginning of each contract term. Patent Management: This performance obligation related to the IPM Product Line. The Company paid patent registration fees for customers in multiple countries to ensure their patents do not expire. Transaction fee Revenues were recognized at the time payment is made on the client’s behalf to the applicable patent office. Fees were paid annually at the beginning of each term. Variable Consideration In some cases, contracts provide for variable consideration that is contingent upon the occurrence of uncertain future events, such as retroactive discounts provided to the customers, indexed or volume based discounts, and revenues between contract expiration and renewal. Variable consideration is estimated at the expected value or at the most likely amount depending on the type of consideration. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenues recognized will not occur when the uncertainty associated with the variable consideration is resolved. The estimate of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of its anticipated performance and all information (historical, current, and forecasted) that is reasonably available to the Company. Significant Judgments Significant judgments and estimates are necessary for the allocation of the proceeds received from an arrangement to the multiple performance obligations and the appropriate timing of revenues recognition. Our contracts with customers often include promises to transfer multiple products and services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. Determining a standalone selling price that may not be directly observable amongst all the products and performance obligations requires judgment. Specifically, many Web of Science Product Line contracts include multiple product offerings, which may have both subscription and transactional revenues. Judgment is also required to determine whether the software license is considered distinct and accounted for separately, or not distinct and accounted for together with the subscription service and recognized over time for other products. The Company allocates value to primary content subscriptions or licenses and accompanying performance obligations, such as training subscriptions, access to historical content, maintenance and other optional content. When multiple performance obligations exist in a single contract, the transaction price is allocated to each performance obligation based on the standalone selling price of each performance obligation. The Company utilizes its standard price lists to determine the standalone selling price based on the product and country. The Company allocates the transaction price to each performance obligation based on the best estimate of the standalone selling price of each distinct good or service in the contract. The transaction price in the contract is allocated at contract inception to the distinct good or service underlying each performance obligation in proportion to the standalone selling price. The standalone selling prices are based on the Company’s normal pricing practices when sold separately with consideration of market conditions and other factors, including customer demographics and geographic location. Discounts applied to the contract will be allocated based on the same proportion of standalone selling prices. Cost to Obtain a Contract Commission costs represent costs to obtain a contract and are considered contract assets. The Company pays commissions to the sales managers and support teams for earning new customers and renewing contracts with existing customers. These commission costs are capitalized within Prepaid expenses and other non-current assets on the Consolidated Balance Sheet. The costs are amortized to Selling, general and administrative expenses within the Consolidated Statements of Operations. The amortization period is between one and five years based on the estimated length of the customer relationship. Deferred Revenues The timing of revenue recognition may differ from the timing of invoicing to customers. We record deferred revenues when revenues are recognized subsequent to invoicing. For multi-year agreements, we generally invoice customers annually at the beginning of each annual coverage period and recognize revenues over the term of the coverage period. | ||
Cost of Revenues, Excluding Depreciation and Amortization | Cost of Revenues, Excluding Depreciation and Amortization Cost of revenues consists of costs related to the production and servicing of the Company’s offerings. These costs primarily relate to information technology, production and maintenance of content and personnel costs relating to professional services and customer service. | ||
Selling, General and Administrative, Excluding Depreciation and Amortization | Selling, General and Administrative, Excluding Depreciation and Amortization Selling, general and administrative includes compensation for support and administrative functions in addition to rent, office expenses, professional fees and other miscellaneous expenses. In addition, it includes selling and marketing costs associated with acquiring new customers or selling new products or product renewals to existing customers. Such costs primarily relate to wages and commissions for sales and marketing personnel. | ||
Depreciation | Depreciation Depreciation expense relates to the Company’s fixed assets including furniture & fixtures, hardware, and leasehold improvements. These assets are depreciated over their expected useful lives, and in the case of leasehold improvements over the shorter of their useful life or the life of the related lease. | ||
Amortization | Amortization Amortization expense relates to the Company’s finite-lived intangible assets including databases and content, customer relationships, and computer software. These assets are being amortized over periods of 2 to 20 years. | ||
Share-Based Compensation | Share-Based Compensation Share-based compensation expense includes cost associated with stock options granted to certain members of key management. The fair value of stock options is estimated at the date of grant using the Black-Scholes option pricing model, which requires management to make certain assumptions of future expectations based on historical and current data. The assumptions include the expected term of the stock option, expected volatility, dividend yield, and risk-free interest rate. The expected term represents the amount of time that options granted are expected to be outstanding, based on forecasted exercise behavior. The risk-free rate is based on the rate at grant date of zero-coupon U.S. treasury notes with a term comparable to the expected term of the option. Expected volatility is estimated based on the historical volatility of comparable public entities’ stock price from the same industry. The Company’s dividend yield is based on forecasted expected payments, which are expected to be zero for current plan. The Company recognizes compensation expense over the vesting period of the award on a straight-line basis. The Company elects to recognize forfeitures as they occur. | ||
Transaction Expenses | Transaction Expenses Transaction expenses are incurred by the Company to complete business transactions, including acquisitions and disposals, and typically include advisory, legal and other professional and consulting costs. | ||
Transition, Integration and Other | Transition, Integration and Other Transition, integration and other related expenses provide for the costs of transitioning certain activities performed by the Former Parent to the Company to enable operation on a stand-alone basis. Transition full time employee expense represents labor costs of full time employees who are currently working on migration projects and being expensed. Their traditional role is application development, which was capitalized. | ||
Other operating income (expense), net | Other operating income (expense), net Other operating income (expense), net includes a tax indemnification write down related to the 2016 Transaction for the year ended December 31, 2018. See Note 19: Commitments and Contingencies ( Tax Indemnity ) for further details. The gain on sale of the divested IPM Product Line and related assets is also included in the year ended December 31, 2018. See Note 5: Divested Operations for further details. | ||
Interest Expense | Interest Expense Interest expense consists of interest expense related to our borrowings under the Prior Term Loan Facility and the Prior Notes as well as the amortization of debt issuance costs and interest related to certain derivative instruments. | ||
Foreign Currency Translation | Foreign Currency Translation The operations of each of the Company’s entities are measured using the currency of the primary economic environment in which the subsidiary operates (“functional currency”). Nonfunctional currency monetary balances are re-measured into the functional currency of the operation with any related gain or loss recorded in Selling, general and administrative costs, excluding depreciation and amortization in the accompanying Consolidated Statements of Operations. Assets and liabilities of operations outside the U.S., for which the functional currency is the local currency, are translated into U.S. dollars using period-end exchange rates. Revenues and expenses are translated at the average exchange rate in effect during each fiscal month during the year. The effects of foreign currency translation adjustments are included as a component of Accumulated other comprehensive income (loss) in the accompanying Consolidated Balance Sheets. | ||
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from net income, transactions and other events or circumstances from non-owner sources. | ||
Advertising and Promotion Costs | Advertising and Promotion Costs Advertising and promotion costs are expensed as of the first date that the advertisements take place. Advertising expense was approximately $12,150 and $14,416 for the years ended December 31, 2018 and 2017. | ||
Legal Costs | Legal Costs Legal costs are expensed as incurred. | ||
Debt Issuance Costs | Debt Issuance Costs Fees incurred to issue debt are generally deferred and amortized as a component of interest expense over the estimated term of the related debt using the effective interest rate method. | ||
Earnings Per Share | Earnings Per Share The calculation of earnings per share is based on the weighted average number of common shares or common stock equivalents outstanding during the applicable period. The dilutive effect of common stock equivalents is excluded from basic earnings per share and is included in the calculation of diluted earnings per share. Potentially dilutive securities include outstanding stock options. Employee equity share options and similar equity instruments granted by the Company are treated as potential common shares outstanding in computing diluted earnings per share. Diluted shares outstanding are calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock options, the amount of compensation cost for future service that the Company has not yet recognized, and the amount of benefits that would be recorded in additional paid-in capital when the award becomes deductible for tax purposes are assumed to be used to repurchase shares. | ||
Newly Adopted Accounting Standards and Recently Issued Accounting Standards | Newly Adopted Accounting Standards In February 2016, the FASB issued new guidance, Accounting Standard Update (“ASU”) 2016-02, related to leases in which lessees are required to recognize assets and liabilities on the balance sheet for leases having a term of more than 12 months. Recognition of these lease assets and lease liabilities represents a change from previous GAAP, which did not require lease assets and lease liabilities to be recognized for operating leases. Qualitative disclosures along with specific quantitative disclosures will be required to provide enough information to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities. The Company adopted the standard on January 1, 2019. The provisions of ASU 2016-02 are effective for the Company’s fiscal year beginning January 1, 2019, including interim periods within that fiscal year. The Company elected the package of practical expedients included in this guidance, which allows it to not reassess whether any expired or existing contracts contain leases, the lease classification for any expired or existing leases, and the initial direct costs for existing leases. The Company does not recognize short-term leases on its Interim Condensed Consolidated Balance Sheet, and recognizes those lease payments in Selling, general and administrative costs, excluding depreciation and amortization on the Interim Condensed Consolidated Statements of Operations on a straight-line basis over the lease term. In July 2018, the FASB issued ASU 2018-11, Leases—Targeted Improvements, as an update to the previously-issued guidance. This update added a transition option which allows for the recognition of a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption without recasting the financial statements in periods prior to adoption. The Company elected this transition option. The standard had a material impact on our interim condensed consolidated balance sheet, but did not have an impact on our interim condensed consolidated statement of operations. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases. In June 2018, the FASB issued guidance, ASU 2018-07, Compensation— Stock Compensation, which simplifies the accounting for nonemployee share-based payment transactions. The guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In July 2018, the FASB issued guidance, ASU 2018-09, Codification Improvements, which clarifies guidance that may have been incorrectly or inconsistently applied by certain entities. The guidance is effective for all entities for fiscal years beginning after December 15, 2018. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In August 2018, the FASB issued guidance, ASU 2018-13, which modifies the disclosure requirements on fair value measurements. The guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 with early adoption permitted upon issuance of this update. The Company adopted this standard on January 1, 2019. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. Recently Issued Accounting Standards Except as noted below, there have been no material changes from the recently issued accounting standards previously disclosed in the Annual Report. Please refer to Note 3— “Summary of Significant Accounting Policies” section of the Annual Report for a discussion of the recently issued accounting standards that relate to the Company. In March 2019, the FASB issued ASU 2019‑01, Leases, as an update to the previously-issued guidance. This update added a transition option which clarified the interim disclosure requirements as defined in Accounting Standard Codification 250-10-50-3. The Company elected to provide the ASU 2016-02 transition disclosures as of the beginning of the period of adoption rather than the beginning of the earliest period presented. The guidance is effective for all entities during the same period that ASU 2016-02 is adopted. In April 2019, the FASB issued ASU 2019-04, Codification Imrovements to Topic 326, which provides targeted improvements or clarification and correction to the ASU 2016-01 Financial Instruments Overall, ASU 2016-13 Financial Instruments Credit Losses, and ASU 2017-12 Derivatives and Hedging, accounting standards updates that were previously issued. The guidance is effective upon adoption of the related standards The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In April 2019, the FASB issued ASU 2019-05, Financial Instruments— Credit Losses, which provides targeted transition relief to the accounting standards update previously issued as part of ASU 2016-13 Financial Instruments Credit Losses. The guidance is effective for all entities during the same period that ASU 2016-13 is adopted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. | Newly Adopted Accounting Standards In February 2016, the FASB issued new guidance, Accounting Standard Update (“ASU”) 2016-02, related to leases in which lessees are required to recognize assets and liabilities on the balance sheet for leases having a term of more than 12 months. Recognition of these lease assets and lease liabilities represents a change from previous GAAP, which did not require lease assets and lease liabilities to be recognized for operating leases. Qualitative disclosures along with specific quantitative disclosures will be required to provide enough information to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities. The Company adopted the standard on January 1, 2019. The provisions of ASU 2016-02 are effective for the Company’s fiscal year beginning January 1, 2019, including interim periods within that fiscal year. The Company elected the package of practical expedients included in this guidance, which allows it to not reassess whether any expired or existing contracts contain leases, the lease classification for any expired or existing leases, and the initial direct costs for existing leases. The Company does not recognize short-term leases on its Interim Condensed Consolidated Balance Sheet, and recognizes those lease payments in Selling, general and administrative costs, excluding depreciation and amortization on the Interim Condensed Consolidated Statements of Operations on a straight-line basis over the lease term. In July 2018, the FASB issued ASU 2018-11, Leases—Targeted Improvements, as an update to the previously-issued guidance. This update added a transition option which allows for the recognition of a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption without recasting the financial statements in periods prior to adoption. The Company elected this transition option. In March 2019, the FASB issued ASU 2019-01, Leases, as an update to the previously-issued guidance. This update added a transition option which clarified the interim disclosure requirements as defined in Accounting Standard Codification 250-10-50-3. The Company elected to provide the ASU 2016-02 transition disclosures as of the beginning of the period of adoption rather than the beginning of the earliest period presented. The guidance is effective for all entities during the same period that ASU 2016-02 is adopted. The standard had a material impact on our Interim Condensed Consolidated Balance Sheet, but did not have an impact on our Interim Condensed Consolidated Statement of Operations. The most significant impact was the recognition of ROU assets and lease liabilities for operating leases. In June 2018, the FASB issued guidance, ASU 2018-07, Compensation— Stock Compensation, which simplifies the accounting for nonemployee share-based payment transactions. The guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In July 2018, the FASB issued guidance, ASU 2018-09, Codification Improvements, which clarifies guidance that may have been incorrectly or inconsistently applied by certain entities. The guidance is effective for all entities for fiscal years beginning after December 15, 2018. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. In August 2018, the FASB issued guidance, ASU 2018-13, which modifies the disclosure requirements on fair value measurements. The guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019 with early adoption permitted upon issuance of this update. The Company adopted this standard on January 1, 2019. This standard did not have a material impact on the Company’s interim condensed consolidated financial statements. Recently Issued Accounting Standards Except as noted below, there have been no material changes from the recently issued accounting standards previously disclosed in the Annual Report. Please refer to Note 3— “Summary of Significant Accounting Policies” section of the Annual Report for a discussion of the recently issued accounting standards that relate to the Company. In April 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, which provides targeted improvements or clarification and correction to the ASU 2016-01 Financial Instruments Overall, ASU 2016-13 Financial Instruments Credit Losses, and ASU 2017-12 Derivatives and Hedging, accounting standards updates that were previously issued. The guidance is effective upon adoption of the related standards The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In April 2019, the FASB issued ASU 2019-05, Financial Instruments— Credit Losses, which provides targeted transition relief to the accounting standards update previously issued as part of ASU 2016-13 Financial Instruments Credit Losses. The guidance is effective for all entities during the same period that ASU 2016-13 is adopted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. | Newly Adopted Accounting Standards In May 2014, the FASB issued new guidance related to revenues from contracts with customers which supersedes previous revenue recognition requirements. This new guidance affects any entity that enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards. Areas of revenue recognition that are affected include, but are not limited to, transfer of control, variable consideration, allocation of transfer pricing, licenses, time value of money, contract costs and disclosures. We elected to adopt the standard using the full retrospective method effective January 1, 2018, which required us to revise each prior reporting period presented. The Company implemented new policies, processes, and systems to enable both the preparation of financial information and internal controls over financial reporting in connection with its adoption of ASC 606. The most significant impact of the standard relates to our accounting for prepaid commissions as part of our cost of subscription contracts. Specifically, commissions paid for new customer sales are now being deferred over a five year life to match the new customer’s expected life and use of the Company’s own capitalized costs for related software technology. This five-year life is considered to cross products and capture the average value a customer benefits from purchasing the Company’s data and products. Additional impacts of the standard related to changes in the method of identifying performance obligations within our EndNote product of the Web of Science Product Line. Adoption of the standard using the full retrospective method required us to restate certain previously reported results. Adoption of the standard related to revenue recognition impacted our previously reported results as follows: Year Ended December 31, 2017 New Revenue As Previously Standard Reported* Adjustment As Adjusted Statement of Operation Revenues, net $ 919,749 $ (2,115) $ 917,634 Cost of revenues, excluding depreciation and amortization (394,264) 49 (394,215) Selling, general and administrative costs, excluding depreciation and amortization (346,836) 3,693 (343,143) Total operating expenses (1,068,403) 3,742 (1,064,661) Loss from operations (148,654) 1,627 (147,027) Loss before income tax (286,850) 1,627 (285,223) Net Loss $ (265,557) $ 1,627 $ (263,930) December 31, 2017 New Revenues As Previously Standard Reported Adjustment As Adjusted Balance Sheet Prepaid expense $ 29,465 $ (1,070) $ 28,395 Total current assets 444,978 (1,070) 443,908 Other non-current assets 54,569 5,460 60,029 Total assets 4,000,721 4,390 4,005,111 Current portion of deferred revenues 356,002 5,258 361,260 Total current liabilities 655,815 5,258 661,073 Total liabilities 2,713,747 5,258 2,719,005 Accumulated deficit (389,231) (868) (390,099) Total Shareholders’ Equity 1,286,974 (868) 1,286,106 Total Liabilities and Shareholders’ Equity $ 4,000,721 $ 4,390 $ 4,005,111 * Reflects additional reclassifications of certain expenses to align the presentation with how the Company currently manages these expenses. Refer to Note 1 — Background and Nature of Operations for further details. In August 2016, the FASB issued new guidance, ASU 2016‑15, related to the statement of cash flows which addresses eight specific cash flow classification issues to reduce diversity in practice. This guidance is effective for the Company for annual reporting periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2017. The guidance should be applied on a retrospective basis. The Company adopted the standard beginning on January 1, 2018. The adoption has no material impact on the consolidated financial statements. In October 2016, the FASB issued new guidance, ASU 2016‑16, for intra-entity transfers of assets other than inventory. This standard requires that an entity should recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. Consequently, the amendments in this standard eliminate the exception for an intra-entity transfer of an asset other than inventory. This guidance is effective for annual reporting periods beginning after December 15, 2017, and interim reporting periods within annual reporting periods beginning after December 15, 2017. The Company adopted the standard effective January 1, 2018. The adoption has no material impact on the consolidated financial statements. In January 2017, the FASB issued new guidance, ASU 2017‑01, which clarifies the requirements needed for assets and activities to meet the definition of a business which affects multiple areas of accounting including acquisitions, disposals, goodwill and consolidations. This guidance is effective for annual periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2017. The Company adopted the standard beginning on January 1, 2018. The adoption has no material impact on the consolidated financial statements. In February 2017, the FASB issued new guidance, ASU 2017‑05, which clarifies the accounting for derecognition (e.g. sales) of nonfinancial assets in contracts with non-customers and defines what is considered an in substance nonfinancial asset. The new standard is effective at the same time of adoption of ASU 2014‑09. The Company adopted the standard effective January 1, 2018. The standard did not have a material impact on the consolidated financial statements. In March 2017, the FASB issued new guidance, ASU 2017‑07, which changes how the net periodic benefit cost of defined benefit and other postretirement benefit plans is presented in the statements of operations. Under the new guidance, the service cost would be presented as a component of operating expenses in the same line item or items as employee compensation costs, and the other components of net periodic benefit cost would be presented outside of operating income. Further, the only component that would be eligible for capitalization into assets such as inventory would be service cost. The guidance is effective for annual periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2017. The guidance is required to be applied on a retrospective basis, with the exception that the guidance regarding capitalization of service cost is to be applied on a prospective basis. The Company elected to adopt the standard effective January 1, 2018. The standard did not have a material impact on the consolidated financial statements. In August 2017, the FASB issued guidance, ASU 2017‑12, which provides targeted improvements to the accounting for hedging activities to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The guidance is effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. The Company early adopted effective January 1, 2018 with a modified retrospective transition method. The standard did not have a material impact on the consolidated financial statements. In February 2018, the FASB issued guidance, ASU 2018‑02, which allows companies to reclassify the tax effects stranded in Accumulated Other Comprehensive Income resulting from The Tax Cuts and Jobs Act to retained earnings. The guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The amendments in this Update should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. Early adoption is permitted, including adoption in any interim period. The Company elected to adopt the standard effective December 31, 2018. The standard did not have a material impact on the consolidated financial statements. Recently Issued Accounting Standards In February 2016, the FASB issued new guidance, ASU 2016‑02, related to leases in which lessees will be required to recognize assets and liabilities on the balance sheet for leases having a term of more than 12 months. Recognition of these lease assets and lease liabilities represents a change from previous GAAP, which did not require lease assets and lease liabilities to be recognized for operating leases. Qualitative disclosures along with specific quantitative disclosures will be required to provide enough information to supplement the amounts recorded in the financial statements so that users can understand more about the nature of an entity’s leasing activities. The Company has elected to adopt the standard effective January 1, 2019. The provisions of ASU 2016‑02 are effective for the Company’s fiscal year beginning January 1, 2019, including interim periods within that fiscal year. The Company plans to elect the package of practical expedients included in this guidance, which allows it to not reassess whether any expired or existing contracts contain leases, the lease classification for any expired or existing leases, and the initial direct costs for existing leases. The Company does not plan to recognize short-term leases on its Consolidated Balance Sheet, and will recognize those lease payments in the Consolidated Statements of Operations on a straight-line basis over the lease term. In July 2018, the FASB issued ASU 2018‑11, Leases — Targeted Improvements, as an update to the previously-issued guidance. This update added a transition option which allows for the recognition of a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption without recasting the financial statements in periods prior to adoption. The Company plans to elect this transition option. At adoption, the Company expects to recognize a material increase in total assets and total liabilities resulting from the recognition of right-of-use assets and the related lease liabilities initially measured at the present value of its future operating lease payments. The Company continues to evaluate the impacts of adopting this guidance on its 2019 Consolidated Balance Sheet, Statement of Operations, Statement of Cash Flows, and is updating processes and internal controls to meet the new reporting and disclosure requirements in ASU 2016‑02. The Company believes the most significant impact relates to its accounting for real estate leases. We do not anticipate significant impact from leases embedded in service contracts, significant changes to cash flows, or changes to our lease portfolio prior to adoption. The adoption of this standard will have no impact on the Company’s covenant compliance under its current debt agreements. In June 2016, the FASB issued new guidance, ASU 2016‑13, related to measurement of credit losses on financial instruments which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. This new guidance replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses. The guidance is effective for annual reporting periods beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2019. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In January 2017, the FASB issued new guidance, ASU 2017‑04, which simplifies testing goodwill for impairment by eliminating Step 2 from the goodwill impairment test as described in previously issued guidance. The guidance is effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In June 2018, the FASB issued guidance, ASU 2018‑07, which simplifies the accounting for nonemployee share-based payment transactions. The guidance is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In July 2018, the FASB issued guidance, ASU 2018‑09, Codification Improvements, which clarifies guidance that may have been incorrectly or inconsistently applied by certain entities. The guidance is effective for all entities for fiscal years beginning after December 15, 2018. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In August 2018, the FASB issued guidance, ASU 2018‑13, which modifies the disclosure requirements on fair value measurements. The guidance is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In August 2018, the FASB issued guidance, ASU 2018‑14, which modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans. The guidance is effective for all entities for fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. In August 2018, the FASB issued guidance, ASU 2018‑15, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal use software license). The accounting for the service element of a hosting arrangement that is a service contract is not affected by the amendments in this Update. The guidance is effective for all entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently in the process of evaluating the impact of the adoption of this standard on its consolidated financial statements. There were no other new accounting standards that we expect to have a material impact to our financial position or results of operations upon adoption. |
Tax Receivable Agreement | Tax Receivable Agreement (“TRA”) Concurrent with the completion of the Transactions in May 2019, we became a party to a TRA with our pre- business combination equity holders. Under the TRA, we are generally required to pay to certain pre-business combination equity holders approximately 85% of the amount of calculated tax savings, if any, we are deemed to realize (using the actual applicable U.S. federal income tax rate and an assumed combined state and local income tax rate) as a result of (1) any existing tax attributes associated with Covered Tax Assets acquired in the pre-business combination organizational transactions, the benefit of which is allocable to us as a result of such transactions, (2) net operating loss (NOL) carryforwards available as a result of such transactions and (3) tax benefits related to imputed interest. Further, there may be significant changes, to the estimate of the TRA liability due to various reasons including changes in corporate tax law, changes in estimates of the amount or timing of future taxable income, and other items. Changes in those estimates are recognized as adjustments to the related TRA liability, with offsetting impacts recorded in the Interim Condensed Consolidated Statement of Operations as Other operating income (expense), net. | Tax Receivable Agreement (“TRA”) Concurrent with the completion of the Transactions in May 2019, we became a party to a TRA with our pre- business combination equity holders. Under the TRA, we are generally required to pay to certain pre-business combination equity holders approximately 85% of the amount of calculated tax savings, if any, we are deemed to realize (using the actual applicable U.S. federal income tax rate and an assumed combined state and local income tax rate) as a result of (1) any existing tax attributes associated with Covered Tax Assets acquired in the pre-business combination organizational transactions, the benefit of which is allocable to us as a result of such transactions, (2) net operating loss (NOL) carryforwards available as a result of such transactions and (3) tax benefits related to imputed interest. Further, there may be significant changes, to the estimate of the TRA liability due to various reasons including changes in corporate tax law, changes in estimates of the amount or timing of future taxable income, and other items. Changes in those estimates are recognized as adjustments to the related TRA liability, with offsetting impacts recorded in the Interim Condensed Consolidated Statement of Operations as Other operating income (expense), net. On August 21, 2019 the Company entered into a TRA Buyout Agreement to settle the outstanding liability. Any settlement of the original TRA liability pursuant to the TRA Buyout Agreement (to the extent that the settlement is less than the recorded liability) will be accounted for as an adjustment to Equity. |
Background and Nature of Oper_2
Background and Nature of Operations (Tables) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Background and Nature of Operations | ||
Schedule of impact on statement of operations due to asc 606 adoption | As Previously As Reported Adjustment Reclassified Three Months Ended June 30, 2018 Cost of revenues, excluding depreciation and amortization $ (117,514) $ 15,472 $ (102,042) Selling, general and administrative costs, excluding depreciation and amortization $ (76,922) $ (15,472) $ (92,394) Six Months Ended June 30, 2018 Cost of revenues, excluding depreciation and amortization $ (240,416) $ 33,204 $ (207,212) Selling, general and administrative costs, excluding depreciation and amortization $ (154,517) $ (33,204) $ (187,721) | Year Ended December 31, 2017 As Previously As Reported Adjustment Reclassified* Consolidated Statements of Operations Cost of revenues, excluding depreciation and amortization $ (422,213) $ 27,949 $ (394,264) Selling, general and administrative costs, excluding depreciation and amortization $ (318,887) $ (27,949) $ (346,836) * |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of Significant Accounting Policies | |
Schedule of property, plant and equipment useful life | Computer hardware 3 years Furniture, fixtures and equipment 5 – 7 years Leasehold improvements Lesser of lease term or estimated useful life |
Schedule of estimated useful life of Identifiable Intangible Assets, net | Customer relationships 2 – 4 years Databases and content 13 – 20 years Trade Names Indefinite |
Schedule of adoption of ASC 606 | Year Ended December 31, 2017 New Revenue As Previously Standard Reported* Adjustment As Adjusted Statement of Operation Revenues, net $ 919,749 $ (2,115) $ 917,634 Cost of revenues, excluding depreciation and amortization (394,264) 49 (394,215) Selling, general and administrative costs, excluding depreciation and amortization (346,836) 3,693 (343,143) Total operating expenses (1,068,403) 3,742 (1,064,661) Loss from operations (148,654) 1,627 (147,027) Loss before income tax (286,850) 1,627 (285,223) Net Loss $ (265,557) $ 1,627 $ (263,930) December 31, 2017 New Revenues As Previously Standard Reported Adjustment As Adjusted Balance Sheet Prepaid expense $ 29,465 $ (1,070) $ 28,395 Total current assets 444,978 (1,070) 443,908 Other non-current assets 54,569 5,460 60,029 Total assets 4,000,721 4,390 4,005,111 Current portion of deferred revenues 356,002 5,258 361,260 Total current liabilities 655,815 5,258 661,073 Total liabilities 2,713,747 5,258 2,719,005 Accumulated deficit (389,231) (868) (390,099) Total Shareholders’ Equity 1,286,974 (868) 1,286,106 Total Liabilities and Shareholders’ Equity $ 4,000,721 $ 4,390 $ 4,005,111 * Reflects additional reclassifications of certain expenses to align the presentation with how the Company currently manages these expenses. Refer to Note 1 — Background and Nature of Operations for further details. |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations | |
Schedule of fair value of identifiable assets acquired and liabilities assumed for all acquisitions | 2018 2017 Other current assets $ 706 $ 51 Finite-lived intangible assets 7,928 3,600 Indefinite-lived intangible assets — 70 Goodwill 21,527 9,767 Other non-current assets 38 14 Total assets 30,199 13,502 Current liabilities 491 182 Non-current liabilities 2,054 19 Total liabilities 2,545 201 Net assets acquired $ 27,654 $ 13,301 |
Leases (Tables)
Leases (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Leases | |||
Schedule of leases costs | Three Months Ended June 30, 2019 Lease cost Operating lease cost $ 7,080 Short-term lease cost 30 Variable lease cost 504 Total lease cost $ 7,614 Six Months Ended June 30, 2019 Lease cost Operating lease cost $ 14,302 Short-term lease cost 30 Variable lease cost 1,161 Total lease cost $ 15,493 Six Months Ended June 30, 2019 Other information Cash Paid for amounts included in measurement of lease liabilities Operating cash flows from operating leases $ 13,654 Weighted-average remaining lease term - operating leases 6 Weighed-average discount rate - operating leases 5.8 % | Three Months Ended September 30, 2019 Lease cost Operating lease cost $ 6,755 Short-term lease cost 57 Variable lease cost 539 Total lease cost $ 7,351 Nine Months Ended September 30, 2019 Lease cost Operating lease cost $ 21,057 Short-term lease cost 87 Variable lease cost 1,700 Total lease cost $ 22,844 Nine Months Ended September 30, 2019 Other information Cash Paid for amounts included in measurement of lease liabilities Operating cash flows from operating leases $ 18,491 Weighted-average remaining lease term - operating leases 6 Weighted-average discount rate - operating leases 5.8 % | |
Schedule of future minimum lease payments for operating leases | The future aggregate minimum lease payments as of June 30, 2019 under all non-cancelable operating leases for the years noted are as follows: Year ending December 31, 2019 (excluding the six months ended June 30, 2019) $ 13,789 2020 21,510 2021 17,788 2022 15,198 2023 13,786 Thereafter 36,054 Total operating lease payments 118,125 Less imputed interest (20,974) Total $ 97,151 | The future aggregate minimum lease payments as of September 30, 2019 under all non-cancelable operating leases for the years noted are as follows: Year ending December 31, 2019 (excluding the nine months ended September 30, 2019) $ 6,912 2020 22,098 2021 18,041 2022 15,593 2023 14,099 2024 & Thereafter 35,824 Total operating lease payments 112,567 Less imputed interest (18,917) Total $ 93,650 | |
Schedule of future minimum annual rental payments for operating leases | Year ending December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 | Year ending December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 | Year ended December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 |
Computer Hardware and Other P_2
Computer Hardware and Other Property, Net (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Computer Hardware and Other Property, Net. | |||
Schedule of computer hardware and other property, net | June 30, 2019 December 31, 2018 Computer hardware $ 20,174 $ 18,130 Leasehold improvements 13,296 13,298 Furniture, fixtures and equipment 6,574 6,816 Total computer hardware and other property 40,044 38,244 Accumulated depreciation (21,554) (17,603) Total computer hardware and other property, net $ 18,490 $ 20,641 | September 30, 2019 December 31, 2018 Computer hardware $ 22,095 $ 18,130 Leasehold improvements 13,965 13,298 Furniture, fixtures and equipment 6,326 6,816 Total computer hardware and other property 42,386 38,244 Accumulated depreciation (22,201) (17,603) Total computer hardware and other property, net $ 20,185 $ 20,641 | December 31, 2018 2017 Computer hardware $ 18,130 $ 11,238 Leasehold improvements 13,298 13,885 Furniture, fixtures and equipment 6,816 6,768 Total computer hardware and other property 38,244 31,891 Accumulated depreciation (17,603) (8,881) Total computer hardware and other property, net $ 20,641 $ 23,010 |
Identifiable Intangible Asset_2
Identifiable Intangible Assets, net (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Other Intangible Assets, net and Goodwill | |||
Schedule of identifiable intangible assets | June 30, 2019 December 31, 2018 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Finite-lived intangible assets Customer relationships $ 290,984 $ (184,761) $ 106,223 $ 291,503 $ (164,611) $ 126,892 Databases and content 1,724,802 (285,550) 1,439,252 1,725,878 (233,733) 1,492,145 Computer software 292,422 (121,699) 170,723 268,704 (97,570) 171,134 Finite-lived intangible assets 2,308,208 (592,010) 1,716,198 2,286,085 (495,914) 1,790,171 Indefinite-lived intangible assets Trade names 168,323 — 168,323 168,349 — 168,349 Total intangible assets $ 2,476,531 $ (592,010) $ 1,884,521 $ 2,454,434 $ (495,914) $ 1,958,520 | September 30, 2019 December 31, 2018 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Finite-lived intangible assets Customer relationships $ 288,026 $ (184,626) $ 103,400 $ 291,503 $ (164,611) $ 126,892 Databases and content 1,721,623 (311,458) 1,410,165 1,725,878 (233,733) 1,492,145 Computer software 308,399 (133,931) 174,468 268,704 (97,570) 171,134 Finite-lived intangible assets 2,318,048 (630,015) 1,688,033 2,286,085 (495,914) 1,790,171 Indefinite-lived intangible assets Trade names 168,313 — 168,313 168,349 — 168,349 Total intangible assets $ 2,486,361 $ (630,015) $ 1,856,346 $ 2,454,434 $ (495,914) $ 1,958,520 | December 31, 2018 December 31, 2017 Accumulated Accumulated Gross Amortization Net Gross Amortization Net Finite-lived intangible assets Customer relationships $ 291,503 $ (164,611) $ 126,892 $ 299,886 $ (95,606) $ 204,280 Databases and content 1,725,878 (233,733) 1,492,145 1,733,304 (130,271) 1,603,033 Computer software 268,704 (97,570) 171,134 235,420 (52,696) 182,724 Finite-lived intangible assets 2,286,085 (495,914) 1,790,171 2,268,610 (278,573) 1,990,037 Indefinite-lived intangible assets Trade names 168,349 — 168,349 170,050 — 170,050 Total intangible assets $ 2,454,434 $ (495,914) $ 1,958,520 $ 2,438,660 $ (278,573) $ 2,160,087 |
Schedule of weighted-average amortization period for finite-lived intangible assets | Remaining Weighted-Average Amortization Period (in years) Customer relationships 10.6 Databases and content 14.9 Computer software 4.9 Total 13.9 | ||
Schedule of estimated amortization for five succeeding years | 2019 $ 176,545 2020 158,807 2021 149,326 2022 117,865 2023 113,545 Thereafter 1,036,411 Subtotal finite-lived intangible assets 1,752,499 Internally developed software projects in process 37,672 Total finite-lived intangible assets 1,790,171 Intangibles with indefinite lives 168,349 Total intangible assets $ 1,958,520 | ||
Schedule of change in the carrying amount of goodwill | Total Balance as of December 31, 2018 $ 1,282,919 Changes due to foreign currency fluctuations (77) Balance as of June 30, 2019 $ 1,282,842 | Total Balance as of December 31, 2018 $ 1,282,919 Changes due to foreign currency fluctuations (1,415) Balance as of September 30, 2019 $ 1,281,504 | Balance as of December 31, 2016 $ 1,305,571 Acquisition 9,767 Measurement period adjustments (4,175) Impact of foreign currency fluctuations and other 90 Balance as of December 31, 2017 $ 1,311,253 Acquisition 21,527 Disposals (49,349) Impact of foreign currency fluctuations and other (512) Balance as of December 31, 2018 $ 1,282,919 |
Goodwill (Tables)
Goodwill (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Goodwill. | |||
Schedule of change in the carrying amount of goodwill | Total Balance as of December 31, 2018 $ 1,282,919 Changes due to foreign currency fluctuations (77) Balance as of June 30, 2019 $ 1,282,842 | Total Balance as of December 31, 2018 $ 1,282,919 Changes due to foreign currency fluctuations (1,415) Balance as of September 30, 2019 $ 1,281,504 | Balance as of December 31, 2016 $ 1,305,571 Acquisition 9,767 Measurement period adjustments (4,175) Impact of foreign currency fluctuations and other 90 Balance as of December 31, 2017 $ 1,311,253 Acquisition 21,527 Disposals (49,349) Impact of foreign currency fluctuations and other (512) Balance as of December 31, 2018 $ 1,282,919 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Fair Value Measurements | |||
Schedule of changes in the earn-out, Level 3 | December 31, 2018 7,075 Revaluations included in earnings 469 June 30, 2019 7,544 | The following table presents the changes in the earn-out, the only Level 3 item, for the three months ended September 30, 2019: June 30, 2019 $ 7,544 Revaluations included in earnings 4,616 September 30, 2019 $ 12,160 The following table presents the changes in the earn-out, the only Level 3 item, for the nine months ended September 30, 2019: December 31, 2018 $ 7,075 Revaluations included in earnings 5,085 September 30, 2019 $ 12,160 | The following table presents the changes in the earn-out, the only Level 3 item, for the years ended December 31, 2018 and 2017. Balance as of December 31, 2016 $ — Earn-out liability 5,900 Balance at December 31, 2017 5,900 Business combinations 4,115 Payment of Earn-out liability(1) (2,470) Revaluations included in earnings (470) Balance as of December 31, 2018 $ 7,075 (1) See Note 19: Commitments and Contingencies for further details. |
Summary of the Company's assets and liabilities that were recognized at fair value on a recurring basis | Total Fair Level 1 Level 2 Level 3 Value June 30, 2019 Liabilities Interest rate swap liability — 2,147 — 2,147 Earn-out liability — — 7,544 7,544 Total $ — $ 2,147 $ 7,544 $ 9,691 Total Fair Level 1 Level 2 Level 3 Value December 31, 2018 Assets Interest rate swap asset — 3,644 — 3,644 — $ 3,644 — $ 3,644 Liabilities Earn-out liability — — 7,075 7,075 Total $ — $ — $ 7,075 $ 7,075 | Total Fair Level 1 Level 2 Level 3 Value September 30, 2019 Liabilities Interest rate swap liability — 3,208 — 3,208 Earn-out liability — — 12,160 12,160 Total $ — $ 3,208 $ 12,160 $ 15,368 Total Fair Level 1 Level 2 Level 3 Value December 31, 2018 Assets Interest rate swap asset — 3,644 — 3,644 $ — $ 3,644 $ — $ 3,644 Liabilities Earn-out liability — — 7,075 7,075 Total $ — $ — $ 7,075 $ 7,075 | December 31, 2018 Total Fair Level 1 Level 2 Level 3 Value Assets Interest rate swap asset $ — $ 3,644 $ — $ 3,644 — 3,644 — 3,644 Liabilities Earn-out — — 7,075 7,075 Total $ — $ — $ 7,075 $ 7,075 December 31, 2017 Total Fair Level 1 Level 2 Level 3 Value Assets Forward contracts asset $ — $ 83 $ — $ 83 Interest rate swap asset — 1,107 — 1,107 — 1,190 — 1,190 Liabilities Earn-out Liability — — 5,900 5,900 Total $ — $ — $ 5,900 $ 5,900 |
Foreign exchange contract | |||
Fair Value Measurements | |||
Schedule of inputs and assumptions | December 31, 2018 2017 Discount Rate N/A 1.26 – 1.5% | ||
Earn-out | |||
Fair Value Measurements | |||
Schedule of inputs and assumptions | The following inputs and assumptions were used to value the earn-out liability as of December 31, 2018: TrademarkVision Risk free rate Discount rate Expected life (in years) 1.54 Publons Risk free rate 2.34 – 2.63% Discount rate 9.23 – 9.72% Expected life (in years) 1.04 – 3.04 The following inputs and assumptions were used to value the earn-out liability as of December 31, 2017: Publons Risk free rate 1.17 – 1.62% Discount rate 11.44 – 11.90% Expected life (in years) 1.12 – 4.12 |
Pension and Other Post-Retire_2
Pension and Other Post-Retirement Benefits (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Pension and Other Post-Retirement Benefits | |||
Schedule of changes in projected benefit obligations, the plan assets, and the funded | December 31, 2018 2017 Obligation and funded status: Change in benefit obligation Projected benefit obligation at beginning of year $ 14,258 $ 13,621 Service costs 888 442 Interest cost 283 168 Plan participant contributions 109 — Actuarial (gain)/losses 29 (640) Divestiture (138) — Benefit payments (274) (123) Expenses paid from assets (35) — Effect of foreign currency translation (634) 790 Projected benefit obligation at end of year $ 14,486 $ 14,258 Change in plan assets Fair value of plan assets at beginning of year $ 5,062 $ 5,062 Actual return on plan assets 95 — Plan participant contributions 109 — Employer contributions 460 123 Benefit payments (274) (123) Expenses paid from assets (35) — Effect of foreign currency translation (233) — Fair value of plan assets at end of year 5,184 5,062 Unfunded status $ (9,302) $ (9,196) | ||
Summary of the amounts recognized in the consolidated balance sheets | December 31, 2018 2017 Current liabilities $ (443) $ (342) Noncurrent liabilities $ (8,859) $ (8,854) AOCI $ (1,054) $ (1,252) | ||
Schedule of accumulated benefit obligation in excess of plan assets and projected benefit obligations in excess of plan assets | December 31, 2018 2017 Plans with accumulated benefit obligation in excess of plan assets: Accumulated benefit obligation $ 13,605 $ 13,499 Fair value of plan assets $ 5,184 $ 5,062 Plans with projected benefit obligation in excess of plan assets: Projected benefit obligation $ 14,486 $ 14,258 Fair value of plan assets $ 5,184 $ 5,062 | ||
Schedule of net periodic benefit cost changes in plan assets and benefit obligations recognized in other comprehensive loss | Three Months Ended June 30, 2019 2018 Service cost $ 220 $ 222 Interest cost 80 71 Expected return on plan assets (40) (37) Amortization of actuarial gains (20) (19) Net periodic benefit cost $ 240 $ 237 Six Month Ended June 30, 2019 2018 Service cost $ 441 $ 444 Interest cost 158 142 Expected return on plan assets (80) (75) Amortization of actuarial gains (38) (39) Net periodic benefit cost $ 481 $ 472 | Three Months Ended September 30, 2019 2018 Service cost $ 220 $ 222 Interest cost 80 71 Expected return on plan assets (40) (37) Amortization of actuarial gains (20) (19) Net periodic benefit cost $ 240 $ 237 Nine Months Ended September 30, 2019 2018 Service cost $ 662 $ 666 Interest cost 238 213 Expected return on plan assets (120) (112) Amortization of actuarial gains (49) (57) Net periodic benefit cost $ 731 $ 710 | December 31, 2018 2017 Service cost $ 888 $ 442 Interest cost 283 168 Expected return on plan assets (150) — Amortization of actuarial gains (78) (4) Net period benefit cost $ 943 $ 606 |
Summary of weighted-average assumptions used to determine the net periodic benefit cost | December 31, 2018 2017 Discount rate 2.31 % 2.38 % Expected return on plan assets 3.00 % — % Rate of compensation increase 3.76 % 4.56 % Social Security increase rate 2.50 % 2.50 % Pension increase rate 1.80 % 2.00 % | ||
Summary of weighted-average assumptions used to determine the benefit obligations | December 31, 2018 2017 Discount rate 2.26 % 2.31 % Rate of compensation increase 3.68 % 3.76 % Social Security increase rate 2.50 % 2.50 % Pension increase rate 1.80 % 1.80 % | ||
Schedule of fair value of our plan assets and the respective level in the far value hierarchy by asset category | December 31, 2018 December 31, 2017 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Fair value measurement of pension plan assets: Insurance contract $ — — 5,184 $ 5,184 $ — — 5,062 $ 5,062 | ||
Schedule of estimated pension benefit payments | 2019 $ 488 2020 610 2021 489 2022 643 2023 781 2024 to 2027 4,923 Total $ 7,934 |
Debt (Tables)
Debt (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Debt | |||
Summary of debt | June 30, 2019 December 31, 2018 Interest Carrying Interest Carrying Type Maturity Rate Value Rate Value Senior Unsecured Notes 2024 7.875 % $ 500,000 7.875 % $ 500,000 Term Loan Facility 2023 5.652 % 846,320 5.729 % 1,483,993 Revolving Credit Facility 2021 — % — 5.754 % 5,000 Revolving Credit Facility 2021 — % — 5.729 % 40,000 Total debt outstanding 1,346,320 2,028,993 Deferred financing charges (21,201) (34,838) Term Loan Facility, discount (1,855) (3,633) Current Portion of Long-Term Debt (15,345) (60,345) Long-term debt, net of current portion and deferred financing charges $ 1,307,919 $ 1,930,177 | September 30, 2019 December 31, 2018 Interest Carrying Interest Carrying Type Maturity Rate Value Rate Value Senior Unsecured Notes 2024 7.875 % $ 500,000 7.875 % $ 500,000 Term Loan Facility 2023 5.294 % 842,484 5.729 % 1,483,993 Revolving Credit Facility 2021 — % — 5.754 % 5,000 Revolving Credit Facility 2021 — % — 5.729 % 40,000 Total debt outstanding 1,342,484 2,028,993 Deferred financing charges (20,038) (34,838) Term Loan Facility, discount (1,737) (3,633) Current Portion of Long-Term Debt (15,345) (60,345) Long-term debt, net of current portion and deferred financing charges $ 1,305,364 $ 1,930,177 | December 31, 2018 December 31, 2017 Effective Effective Interest Carrying Interest Carrying Type Maturity Rate Value Rate Value Senior Unsecured Prior Notes 2024 7.875 % $ 500,000 7.875 % $ 500,000 Prior Term Loan Facility 2023 5.729 % 1,483,993 4.700 % 1,530,700 The Prior Revolving Credit Facility 2021 5.754 % 5,000 — % — The Prior Revolving Credit Facility 2021 5.729 % 40,000 4.751 % 30,000 Total debt outstanding 2,028,993 2,060,700 Debt issuance costs (34,838) (43,086) Prior Term Loan Facility, discount (3,633) (4,534) Short-term debt, including current portion of long-term debt (60,345) (45,345) Long-term debt, net of current portion and debt issuance costs $ 1,930,177 $ 1,967,735 |
Schedule of Senior Unsecured Notes redemption price as a percentage of principal | Redemption Price Period (as a percentage of principal) 2019 103.938 % 2020 101.969 % 2021 and thereafter 100.000 % | ||
Schedule of maturities of outstanding borrowings | Amounts due under all of the outstanding borrowings as of December 31, 2018 for the next five years are as follows: 2019 $ 60,345 2020 15,345 2021 15,345 2022 15,345 2023 1,422,613 Thereafter 500,000 Total maturities 2,028,993 Less: capitalized debt issuance costs and original issue discount (38,471) Total debt outstanding as of December 31, 2018 $ 1,990,522 |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Revenue Recognition | |||
Schedule of disaggregated revenues | Three Months Ended June 30, 2019 2018 Subscription revenues $ 202,747 $ 199,481 Transactional revenues 39,693 44,729 Total revenues, gross 242,440 244,210 Deferred revenues adjustment (1) (131) (913) Total Revenues, net $ 242,309 $ 243,297 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. Six Months Ended June 30, 2019 2018 Subscription revenues $ 395,239 $ 392,106 Transactional revenues 81,390 90,598 Total revenues, gross 476,629 482,704 Deferred revenues adjustment (1) (295) (2,380) Total Revenues, net $ 476,334 $ 480,324 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. | Three Months Ended September 30, 2019 2018 Subscription revenues $ 200,813 $ 204,305 Transactional revenues 42,252 39,117 Total revenues, gross 243,065 243,422 Deferred revenues adjustment (1) (67) (525) Total Revenues, net $ 242,998 $ 242,897 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. Nine Months Ended September 30, 2019 2018 Subscription revenues $ 596,052 $ 596,411 Transaction revenues 123,642 129,715 Total revenues, gross 719,694 726,126 Deferred revenues adjustment (1) (362) (2,905) Total Revenues, net $ 719,332 $ 723,221 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. | Years Ended December 31, 2018 2017 Subscription revenues $ 794,097 $ 785,717 Transaction revenues 177,523 181,590 Total revenues, gross 971,620 967,307 Deferred revenues adjustment(1) (3,152) (49,673) Total Revenues, net $ 968,468 $ 917,634 (1) This accounting adjustment relates to the 2016 Transaction, which included a revaluation of deferred revenues to account for the difference in value between the customer advances retained by the Company upon the consummation of the 2016 Transaction and our outstanding performance obligations related to those advances. |
Schedule of contract balances | Current portion Non-current Accounts of deferred portion of receivables revenues deferred revenues Opening (1/1/2019) $ 331,295 $ 391,102 $ 17,112 Closing (6/30/2019) 270,584 404,753 22,236 (Increase)/decrease $ 60,711 $ (13,651) $ (5,124) Opening (1/1/2018) $ 317,808 $ 361,260 $ 15,796 Closing (12/31/2018) 331,295 391,102 17,112 Increase $ (13,487) $ (29,842) $ (1,316) | Current portion Non-current Accounts of deferred portion of receivable revenues deferred revenues Opening (1/1/2019) $ 331,295 $ 391,102 $ 17,112 Closing (9/30/2019) 226,997 330,786 21,299 (Increase)/decrease $ 104,298 $ 60,316 $ (4,187) Opening (1/1/2018) $ 317,808 $ 361,260 $ 15,796 Closing (12/31/2018) 331,295 391,102 17,112 (Increase) $ (13,487) $ (29,842) $ (1,316) | Current portion Non-current Accounts of deferred portion of receivables revenues deferred revenues Opening (1/1/2018) $ 317,808 $ 361,260 $ 15,796 Closing (12/31/2018) 331,295 391,102 17,112 (Increase)/decrease $ (13,487) $ (29,842) $ (1,316) Opening (1/1/2017) $ 361,586 $ 333,944 $ 18,602 Closing (12/31/2017) 317,808 361,260 15,796 (Increase)/decrease $ 43,778 $ (27,316) $ 2,806 |
Employment and Compensation A_2
Employment and Compensation Arrangements (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Employee Incentive Plans | |||
Summary of stock option activity | Weighted-Average Weighted Remaining Aggregate Number of Average Exercise Contractual Life Intrinsic Options Price per Share (in years) Value Balance at December 31, 2018, as originally reported 185,601 $ 1,587 8.5 $ 13,293 Modified options 24,339,097 — — — Balance at December 31, 2018, as modified 24,524,698 12.44 8.5 13,293 Granted 2,321,360 17.72 7.8 — Expired (278,011) 11.13 — — Forfeited (1,296,615) 10.95 — — Exercised (18,498) 7.41 — 147 Outstanding as of June 30, 2019 25,252,934 $ 11.28 8.3 $ 111,373 Vested and exercisable at June 30, 2019 13,768,097 $ 10.35 7.6 $ 63,761 | Weighted-Average Weighted Remaining Aggregate Number of Average Exercise Contractual Life Intrinsic Options Price per Share (in years) Value Balance at December 31, 2018, as originally reported 185,601 $ 1,587 8.5 $ 13,293 Modified options 24,339,097 — — — Balance at December 31, 2018, as modified 24,524,698 12.44 8.5 13,293 Granted 2,321,360 17.55 9.5 — Expired (820,612) 8.54 — — Forfeited (2,268,238) 11.24 — — Exercised (800,756) 6.66 — 8,106 Outstanding as of September 30, 2019 22,956,452 $ 11.96 7.9 $ 146,085 Vested and exercisable at September 30, 2019 14,374,000 $ 11.52 7.7 $ 79,377 | Number Weighted Average Weighted Average Aggregate of Exercise Price per Remaining Intrinsic Options Share Contractual Life Value Balance at December 31, 2017, as originally reported 170,693 $ 1,572.00 9.3 $ 2,262 Modified options 22,384,111 — — — Balance at December 31, 2017, as modified 22,554,804 12.32 9.3 2,262 Granted 4,119,737 11.73 9.7 — Forfeited and expired (2,149,843) 11.15 — — Outstanding as of December 31, 2018 24,524,698 $ 11.07 8.5 $ 13,293 Vested and exercisable at December 31, 2018 6,654,930 $ 10.92 8.3 $ 3,880 |
Summary of assumption used to value options granted during the period presented and their expected lives | June 30, 2019 Weighted-average expected dividend yield — Weighted-average expected volatility 19.87 % Weighted-average risk-free interest rate 2.43 % Expected life (in years) 5-9 | September 30, 2019 Weighted-average expected dividend yield — Weighted-average expected volatility 19.87 % Weighted-average risk-free interest rate 2.43 % Expected life (in years) 5-9 | December 31, 2018 2017 Weighted-average expected dividend yield — — Expected volatility 21.00 – 23.05% 24.84 – 27.90% Weighted-average expected volatility Weighted-average risk-free interest rate Expected life (in years) 8.5 9.0 |
Summary of share-based compensation | Three Months Ended June 30, 2019 2018 Share-based compensation expense $ 33,932 $ 2,842 Tax benefit recognized $ 85 $ 85 Six Months Ended June 30, 2019 2018 Share-based compensation expense $ 37,108 $ 7,022 Tax benefit recognized $ 163 $ 192 | Three Months Ended September 30, 2019 2018 Share-based compensation expense $ 9,567 $ 3,660 Tax benefit recognized $ 45 $ 96 Nine Months Ended September 30, 2019 2018 Share-based compensation expense $ 46,675 $ 10,682 Tax benefit recognized $ 201 $ 288 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes | |
Schedule of income tax (benefit)/expense on income/(loss) | Years Ended December 31, 2018 2017 Current U.K. $ 1,014 $ (142) U.S. Federal 6,395 5,202 U.S. State 2,146 833 Other 11,061 8,552 Total current 20,616 14,445 Deferred U.K. 85 (427) U.S. Federal (5,465) (10,648) U.S. State (227) (142) Other (9,360) (24,521) Total deferred(1) (14,967) (35,738) Total provision (benefit) for income taxes $ 5,649 $ (21,293) (1) Due to rate reductions in the U.S. and Belgium enacted in the 4th quarter of 2017. |
Schedule of components of pre-tax loss | Years Ended December 31, 2018 2017 U.K. $ (222,043) $ (211,944) U.S. (11,880) (58,054) Other loss (2,590) (15,225) Pre-tax loss $ (236,513) $ (285,223) |
Schedule of reconciliation of the statutory income tax rate to effective tax rate | Years Ended December 31, 2018 2017 Loss before tax: $ (236,513) $ (285,223) Income tax, at the statutory rate (44,937) (54,905) Statutory rate(1) 19.0 % 19.3 % Effect of different tax rates (1.2) % 3.3 % Tax rate modifications(2) — % 5.7 % Valuation Allowances (18.0) % (20.8) % Permanent differences (0.7) % 0.3 % Withholding tax (0.2) % (0.3) % Tax indemnity (2.7) % — % Sale of Subsidiary 2.2 % — % Other (0.8) % — % Effective rate (2.4) % 7.5 % (1) The Company performs a reconciliation of the income tax provisions based on its domicile and statutory rate. Reconciliations are based on the U.K. statutory corporate tax rate. (2) Due to rate reductions in the U.S. and Belgium enacted in the 4th quarter of 2017. |
Schedule of deferred income tax assets and liabilities | The tax effects of the significant components of temporary differences giving rise to the Company’s deferred income tax assets and liabilities are as follows: December 31, 2018 2017 Accounts receivable $ 916 $ 1,310 Goodwill — 1,217 Fixed assets, net — 1,670 Accrued expenses 3,735 3,417 Deferred revenues 3,570 915 Other assets 9,655 4,700 Unrealized gain/loss 74 528 Debt issuance costs 1,199 — Operating losses and tax attributes 135,219 94,571 Total deferred tax assets 154,368 108,328 Valuation allowances (133,856) (92,812) Net deferred tax assets 20,512 15,516 Other identifiable intangible assets, net (43,247) (57,082) Other liabilities (7,785) (3,286) Goodwill (42) — Fixed Assets, net (238) — Debt issuance costs — (116) Total deferred tax liabilities (51,312) (60,484) Net deferred tax liabilities $ (30,800) $ (44,968) In the Consolidated Balance Sheets, deferred tax assets and liabilities are shown net if they are in the same jurisdiction. The components of the net deferred tax liabilities as reported on the Consolidated Balance Sheets are as follows: December 31, 2018 2017 Deferred tax asset $ 12,426 $ 6,824 Deferred tax liability (43,226) (51,792) Net deferred tax liability $ (30,800) $ (44,968) |
Summary of unrecognized tax benefits, excluding interest and penalties: | December 31, 2018 2017 Balance at the Beginning of the year $ 91 $ 211 Increases for tax positions taken in prior years 1,339 — Increases for tax positions taken in the current year 72 — Decreases due to statute expirations (52) (120) Balance at the End of the year $ 1,450 $ 91 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Earnings per Share | |||
Schedule of basic and diluted EPS computations for our common stock | The basic and diluted EPS computations for our common stock are calculated as follows (in thousands, except per share amounts): Three Months Ended June 30, 2019 2018 Basic/Diluted EPS Net loss $ (77,761) $ (66,944) Weighted-average number of common shares outstanding 264,762,720 217,461,225 Basic EPS (0.29) (0.31) Diluted EPS (0.29) (0.31) Six Months Ended June 30, 2019 2018 Basic/Diluted EPS Net loss $ (137,021) $ (143,981) Weighted-average number of common shares outstanding 241,275,061 217,411,896 Basic EPS (0.57) (0.66) Diluted EPS (0.57) (0.66) | The basic and diluted EPS computations for our common stock are calculated as follows (in thousands, except per share amounts): Three Months Ended September 30, 2019 2018 Basic/Diluted EPS Net income (loss) $ 10,831 $ (54,727) Basic Weighted-average number of common shares outstanding 305,428,062 217,506,553 Diluted Weighted-average number of common shares outstanding 328,854,063 217,506,553 Basic EPS 0.04 (0.25) Diluted EPS 0.03 (0.25) Nine Months Ended September 30, 2019 2018 Basic/Diluted EPS Net loss $ (126,190) $ (198,708) Basic Weighted-average number of common shares outstanding 262,894,388 217,450,475 Diluted Weighted-average number of common shares outstanding 262,894,388 217,450,475 Basic EPS (0.48) (0.91) Diluted EPS (0.48) (0.91) | The basic and diluted EPS computations for our common stock are calculated as follows (in thousands, except per share amounts): Years Ended December 31, 2018 2017 Basic/Diluted EPS Net loss $ (242,162) $ (263,930) Preferred stock dividends — — Income available to common stockholders $ (242,162) $ (263,930) Weighted-average number of common shares outstanding 217,472,870 216,848,866 Basic EPS $ (1.11) $ (1.22) Diluted EPS $ (1.11) $ (1.22) |
Product and Geographic Sales _2
Product and Geographic Sales Information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Product and Geographic Sales Information | |
Schedule of summarizes revenues from external customers by geography | Years Ended December 31, 2018 2017 Revenues: North America $ 450,356 $ 455,791 Europe 242,415 243,245 APAC 209,118 201,234 Emerging Markets 69,731 67,037 Deferred revenues adjustment (3,152) (49,673) Total $ 968,468 $ 917,634 |
Schedule of summarizes non-current assets other than financial instruments and deferred tax assets by geography | December 31, 2018 2017 Assets: North America $ 1,036,192 $ 1,163,704 Europe 2,145,073 2,294,998 APAC 79,487 68,034 Emerging Markets 24,241 26,533 Total $ 3,284,993 $ 3,553,269 |
Schedule of summarizes revenue by product group | Years Ended December 31, 2018 2017 Web of Science Product Line $ 361,957 $ 352,995 Cortellis Product Line 165,920 165,995 Science Group 527,877 518,990 Derwent Product Line 179,321 176,201 MarkMonitor Product Line 122,947 120,408 Years Ended December 31, 2018 2017 CompuMark Product Line 121,025 119,854 Intellectual Property Group 423,293 416,463 IP Management Product Line 20,450 31,854 Deferred revenues adjustment (3,152) (49,673) Total $ 968,468 $ 917,634 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Commitments and Contingencies | |||
Summary of future aggregate minimum lease payments | Year ending December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 | Year ending December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 | Year ended December 31, 2019 $ 22,140 2020 19,531 2021 17,240 2022 15,333 2023 14,944 Thereafter 40,367 Total operating lease commitments $ 129,555 |
Summary of future unconditional purchase obligations | Year ended December 31, 2019 $ 34,321 2020 24,370 2021 8,151 2022 13 Total $ 66,855 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | |
Derivative Instruments | ||
Summary of the changes in AOCI (net of tax) related to cash flow hedges | The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and six months ended June 30, 2018: AOCI Balance at December 31, 2017 $ 1,107 Derivative gains (losses) recognized in Other comprehensive income (loss) 3,786 Amount reclassified out of Other comprehensive income (loss) to net loss (288) AOCI Balance at March 31, 2018 $ 4,605 Derivative gains (losses) recognized in Other comprehensive income (loss) 1,797 Amount reclassified out of Other comprehensive income (loss) to net loss (72) AOCI Balance at June 30, 2018 $ 6,330 The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and six months ended June 30, 2019: AOCI Balance at December 31, 2018 $ 3,644 Derivative gains (losses) recognized in Other comprehensive income (loss) (2,376) Amount reclassified out of Other comprehensive income (loss) to net loss 430 AOCI Balance at March 31, 2019 $ 1,698 Derivative gains (losses) recognized in Other comprehensive income (loss) (4,247) Amount reclassified out of Other comprehensive income (loss) to net loss 402 AOCI Balance at June 30, 2019 $ (2,147) | The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and nine months ended September 30, 2018: AOCI Balance at December 31, 2017 $ 1,107 Derivative gains (losses) recognized in Other comprehensive income (loss) 3,786 Amount reclassified out of Other comprehensive income (loss) to net loss (288) AOCI Balance at March 31, 2018 $ 4,605 Derivative gains (losses) recognized in Other comprehensive income (loss) 1,797 Amount reclassified out of Other comprehensive income (loss) to net loss (72) AOCI Balance at June 30, 2018 $ 6,330 Derivative gains (losses) recognized in Other comprehensive income (loss) 651 Amount reclassified out of Other comprehensive income (loss) to net loss 73 AOCI Balance at September 30, 2018 $ 7,054 The following table summarizes the changes in AOCI (net of tax) related to cash flow hedges for the three and nine months ended September 30, 2019: AOCI Balance at December 31, 2018 $ 3,644 Derivative gains (losses) recognized in Other comprehensive income (loss) (2,376) Amount reclassified out of Other comprehensive income (loss) to net loss 430 AOCI Balance at March 31, 2019 $ 1,698 Derivative gains (losses) recognized in Other comprehensive income (loss) (4,247) Amount reclassified out of Other comprehensive income (loss) to net loss 402 AOCI Balance at June 30, 2019 $ (2,147) Derivative gains (losses) recognized in Other comprehensive income (loss) (1,271) Amount reclassified out of Other comprehensive income (loss) to net loss 210 AOCI Balance at September 30, 2019 $ (3,208) |
Background and Nature of Oper_3
Background and Nature of Operations (Details) $ / shares in Units, $ in Thousands | Sep. 10, 2019$ / sharesshares | May 13, 2019 | Jul. 10, 2016USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Transaction & Prior Period Expense | |||||||||||||
Issuance of common stock, net (in shares) | shares | 34,500,000 | ||||||||||||
Share price (in dollars per share) | $ / shares | $ 16 | ||||||||||||
Shares Exchange Ratio due to Reverse Capitalization | 132.13667 | ||||||||||||
Cost of revenues, excluding depreciation and amortization | $ (87,117) | $ (87,629) | $ (93,993) | $ (102,042) | $ (176,896) | $ (207,212) | $ (264,013) | $ (301,205) | $ (396,499) | $ (394,215) | |||
Selling, general and administrative costs, excluding depreciation and amortization | $ (96,017) | $ (92,453) | $ (92,871) | (92,394) | $ (184,749) | (187,721) | $ (280,766) | $ (280,592) | $ (369,377) | (343,143) | |||
Prior Period Expense | As Previously Reported | |||||||||||||
Transaction & Prior Period Expense | |||||||||||||
Cost of revenues, excluding depreciation and amortization | (117,514) | (240,416) | (422,213) | ||||||||||
Selling, general and administrative costs, excluding depreciation and amortization | (76,922) | (154,517) | (318,887) | ||||||||||
Prior Period Expense | Adjustments | |||||||||||||
Transaction & Prior Period Expense | |||||||||||||
Cost of revenues, excluding depreciation and amortization | 15,472 | 33,204 | 27,949 | ||||||||||
Selling, general and administrative costs, excluding depreciation and amortization | (15,472) | (33,204) | (27,949) | ||||||||||
Prior Period Expense | As Reclassified | |||||||||||||
Transaction & Prior Period Expense | |||||||||||||
Cost of revenues, excluding depreciation and amortization | (102,042) | (207,212) | (394,264) | ||||||||||
Selling, general and administrative costs, excluding depreciation and amortization | $ (92,394) | $ (187,721) | $ (346,836) | ||||||||||
The 2016 Transaction | |||||||||||||
Transaction & Prior Period Expense | |||||||||||||
Total consideration | $ 3,566,599 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Restricted Cash and Concentration of credit risk (Details) $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018USD ($)customer | |
Summary of Significant Accounting Policies | |||
Restricted Cash | $ | $ 0 | ||
Number of largest customers | customer | 10 | ||
Percentage Payment of Calculated Tax Savings to Pre Business Combination Equity Holders | 85.00% | 85.00% | |
Revenue | |||
Summary of Significant Accounting Policies | |||
Revenue from contract with customer (as a percent) | 6.00% | ||
Revenue | Maximum | |||
Summary of Significant Accounting Policies | |||
Revenue from contract with customer (as a percent) | 1.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Other Information (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018USD ($)item | Dec. 31, 2017USD ($)item | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Oct. 03, 2016USD ($) | |
Summary of Significant Accounting Policies | |||||
Impairment of long lived assets | $ 0 | ||||
Number of reporting units | item | 5 | 1 | |||
Impairment of goodwill | $ 0 | ||||
Impairment of indefinite lived intangible assets | 0 | ||||
Aggregate principal amount | 2,028,993 | $ 2,060,700 | $ 1,342,484 | $ 1,346,320 | |
Advertising expense | $ 12,150 | 14,416 | |||
Minimum | |||||
Summary of Significant Accounting Policies | |||||
Customer Contract Period (in years) | 1 year | ||||
Estimated Useful lives (in years) | 2 years | ||||
Maximum | |||||
Summary of Significant Accounting Policies | |||||
Customer Contract Period (in years) | 2 years | ||||
Estimated Useful lives (in years) | 20 years | ||||
Term Loan Facility | |||||
Summary of Significant Accounting Policies | |||||
Aggregate principal amount | $ 1,483,993 | $ 1,530,700 | $ 842,484 | $ 846,320 | $ 1,550,000 |
Capitalized computer software | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 5 years | ||||
Purchased computer software | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 3 years | ||||
Customer relationships | Minimum | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 2 years | ||||
Customer relationships | Maximum | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 14 years | ||||
Databases and content | Minimum | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 13 years | ||||
Databases and content | Maximum | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 20 years | ||||
Computer hardware | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 3 years | ||||
Furniture, fixtures and equipment | Minimum | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 5 years | ||||
Furniture, fixtures and equipment | Maximum | |||||
Summary of Significant Accounting Policies | |||||
Estimated Useful lives (in years) | 7 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Newly Adopted Accounting Standards (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2016 | |
Summary of Significant Accounting Policies | |||||||||||||
Revenues, net | $ 242,998 | $ 242,309 | $ 242,897 | $ 243,297 | $ 476,334 | $ 480,324 | $ 719,332 | $ 723,221 | $ 968,468 | $ 917,634 | |||
Cost of revenues, excluding depreciation and amortization | |||||||||||||
Cost of revenues, excluding depreciation and amortization | (87,117) | (87,629) | (93,993) | (102,042) | (176,896) | (207,212) | (264,013) | (301,205) | (396,499) | (394,215) | |||
Selling, general and administrative costs, excluding depreciation and amortization | (96,017) | (92,453) | (92,871) | (92,394) | (184,749) | (187,721) | (280,766) | (280,592) | (369,377) | (343,143) | |||
Total operating expenses | (207,154) | (278,890) | (261,828) | (277,727) | (538,834) | (560,646) | (745,988) | (822,474) | (1,074,176) | (1,064,661) | |||
Loss from operations | 35,844 | (36,581) | (18,931) | (34,430) | (62,500) | (80,322) | (26,656) | (99,253) | (105,708) | (147,027) | |||
Loss before income tax | 12,475 | (74,049) | (51,483) | (66,933) | (133,069) | (143,624) | (120,594) | (195,107) | (236,513) | (285,223) | |||
Net loss | 10,831 | (77,761) | (54,727) | (66,944) | (137,021) | (143,981) | (126,190) | (198,708) | (242,162) | (263,930) | |||
Prepaid expenses | 34,927 | 39,238 | 39,238 | 34,927 | 31,021 | 28,395 | |||||||
Total current assets | 361,273 | 365,471 | 365,471 | 361,273 | 408,612 | 443,908 | |||||||
Other non-current assets | 19,368 | 23,890 | 23,890 | 19,368 | 26,556 | 60,029 | |||||||
TOTAL ASSETS | 3,650,293 | 3,688,236 | 3,688,236 | 3,650,293 | 3,709,674 | 4,005,111 | |||||||
Current portion of deferred revenues | 330,786 | 404,753 | 391,102 | 391,102 | 404,753 | 391,102 | 330,786 | 391,102 | 391,102 | 361,260 | $ 333,944 | ||
Total current liabilities | 560,295 | 602,355 | 602,355 | 560,295 | 643,714 | 661,073 | |||||||
TOTAL LIABILITIES | 2,277,786 | 2,331,582 | 2,331,582 | 2,277,786 | 2,659,067 | 2,719,005 | |||||||
Accumulated deficit | (758,451) | (769,282) | (769,282) | (758,451) | (632,261) | (390,099) | |||||||
Total stockholders' equity | 1,372,507 | 1,356,654 | $ 1,098,104 | $ 1,151,548 | 1,356,654 | $ 1,151,548 | 1,372,507 | $ 1,098,104 | 1,050,607 | 1,286,106 | $ 990,772 | $ 1,220,799 | $ 1,505,361 |
Total Liabilities and Shareholders' Equity | $ 3,650,293 | $ 3,688,236 | $ 3,688,236 | $ 3,650,293 | $ 3,709,674 | 4,005,111 | |||||||
ASU 2014-09 | As Previously Reported | |||||||||||||
Summary of Significant Accounting Policies | |||||||||||||
Revenues, net | 919,749 | ||||||||||||
Cost of revenues, excluding depreciation and amortization | |||||||||||||
Cost of revenues, excluding depreciation and amortization | (394,264) | ||||||||||||
Selling, general and administrative costs, excluding depreciation and amortization | (346,836) | ||||||||||||
Total operating expenses | (1,068,403) | ||||||||||||
Loss from operations | (148,654) | ||||||||||||
Loss before income tax | (286,850) | ||||||||||||
Net loss | (265,557) | ||||||||||||
Prepaid expenses | 29,465 | ||||||||||||
Total current assets | 444,978 | ||||||||||||
Other non-current assets | 54,569 | ||||||||||||
TOTAL ASSETS | 4,000,721 | ||||||||||||
Current portion of deferred revenues | 356,002 | ||||||||||||
Total current liabilities | 655,815 | ||||||||||||
TOTAL LIABILITIES | 2,713,747 | ||||||||||||
Accumulated deficit | (389,231) | ||||||||||||
Total stockholders' equity | 1,286,974 | ||||||||||||
Total Liabilities and Shareholders' Equity | 4,000,721 | ||||||||||||
ASU 2014-09 | Adjustments | |||||||||||||
Summary of Significant Accounting Policies | |||||||||||||
Revenues, net | (2,115) | ||||||||||||
Cost of revenues, excluding depreciation and amortization | |||||||||||||
Cost of revenues, excluding depreciation and amortization | 49 | ||||||||||||
Selling, general and administrative costs, excluding depreciation and amortization | 3,693 | ||||||||||||
Total operating expenses | 3,742 | ||||||||||||
Loss from operations | 1,627 | ||||||||||||
Loss before income tax | 1,627 | ||||||||||||
Net loss | 1,627 | ||||||||||||
Prepaid expenses | (1,070) | ||||||||||||
Total current assets | (1,070) | ||||||||||||
Other non-current assets | 5,460 | ||||||||||||
TOTAL ASSETS | 4,390 | ||||||||||||
Current portion of deferred revenues | 5,258 | ||||||||||||
Total current liabilities | 5,258 | ||||||||||||
TOTAL LIABILITIES | 5,258 | ||||||||||||
Accumulated deficit | (868) | ||||||||||||
Total stockholders' equity | (868) | ||||||||||||
Total Liabilities and Shareholders' Equity | $ 4,390 |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Thousands | Oct. 25, 2018 | Mar. 15, 2018 | Jun. 01, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2016 |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 1,282,919 | $ 1,311,253 | $ 1,281,504 | $ 1,282,842 | $ 1,305,571 | |||
Finite life intangible | 7,928 | 3,600 | ||||||
Fair value of identifiable assets acquired and liabilities assumed for all acquisitions | ||||||||
Other current assets | 706 | 51 | ||||||
Indefinite-lived intangible assets | 70 | |||||||
Goodwill | 21,527 | 9,767 | ||||||
Other non-current assets | 38 | 14 | ||||||
Total assets | 30,199 | 13,502 | ||||||
Current liabilities | 491 | 182 | ||||||
Non-current liabilities | 2,054 | 19 | ||||||
Total liabilities | 2,545 | 201 | ||||||
Net assets acquired | 27,654 | $ 13,301 | ||||||
Goodwill associated to deductible for income tax purposes | 0 | |||||||
TrademarkVision | ||||||||
Business Acquisition [Line Items] | ||||||||
Total purchase price | $ 20,042 | |||||||
Fair market value of the liability associated with the earn-out | 4,115 | |||||||
Goodwill | $ 19,205 | |||||||
Kopernio | ||||||||
Business Acquisition [Line Items] | ||||||||
Total purchase price | $ 3,497 | |||||||
Goodwill | 2,322 | |||||||
Finite life intangible | $ 1,258 | |||||||
Potential future cash payments | 3,500 | |||||||
Publons | ||||||||
Business Acquisition [Line Items] | ||||||||
Total purchase price | $ 7,401 | |||||||
Fair market value of the liability associated with the earn-out | 5,900 | |||||||
Potential future cash payments | $ 9,500 | $ 9,500 | $ 9,500 | $ 9,500 |
The Transactions (Details)
The Transactions (Details) | May 13, 2019USD ($)$ / sharesshares | May 12, 2019USD ($)shares | Jun. 30, 2019shares | Sep. 30, 2019shares | Aug. 14, 2019 |
Business Acquisition [Line Items] | |||||
Stock conversion ratio | 0.00757 | 0.00757 | 0.00757 | ||
Number of shares issued | 1,500,000 | ||||
Warrants to purchase shares of common stock | 52,800,000 | 52,800,000 | 52,800,000 | ||
Shareholders of Jersey (Company Owners) | |||||
Business Acquisition [Line Items] | |||||
Aggregate stock consideration issued | $ | $ 3,052,500 | $ 2,175,000 | |||
Number of shares issued | 305,250,000 | 217,500,000 | |||
Share price | $ / shares | $ 10 | ||||
Ownership percentage | 74.00% | 60.00% | |||
Ownership interest in combined entity at the closing of Transactions | 71.00% | ||||
Warrants to purchase shares of common stock | 52,800,000 | ||||
Compensatory options issued | 24,806,793 | ||||
Number of ordinary shares owned of record by the sponsor | 10,600,000 | ||||
Churchill public shareholders | |||||
Business Acquisition [Line Items] | |||||
Aggregate stock consideration issued | $ | $ 690,000 | ||||
Number of shares issued | 68,999,999 | ||||
Ownership percentage | 26.00% | ||||
Certain Investors | |||||
Business Acquisition [Line Items] | |||||
Number of shares issued | 1,500,000 | ||||
Churchill Sponsor | |||||
Business Acquisition [Line Items] | |||||
Aggregate stock consideration issued | $ | $ 187,500 | ||||
Number of shares issued | 17,250,000 |
Divested Operations (Details)
Divested Operations (Details) - USD ($) $ in Thousands | Oct. 31, 2018 | Oct. 01, 2018 | Dec. 31, 2018 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Net proceeds received excluded Cash and cash equivalents and Restricted cash | $ 80,883 | ||
Net gain on sale | 39,104 | ||
Goodwill Write-Off | $ 49,349 | ||
IP Management (IPM) Product Line | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Purchase price | $ 100,130 | ||
Proceeds inclusive of amounts subject to working capital adjustments | 6,135 | ||
Net proceeds received excluded Cash and cash equivalents and Restricted cash | 25,382 | ||
Net gain on sale | 36,072 | ||
Transaction costs | 3,032 | ||
Goodwill Write-Off | $ 49,349 | ||
Repayment of term loan | $ 31,378 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | |
Lease cost | ||||
Operating lease cost | $ 6,755 | $ 7,080 | $ 14,302 | $ 21,057 |
Short-term lease cost | 57 | 30 | 30 | 87 |
Variable lease cost | 539 | 504 | 1,161 | 1,700 |
Total lease cost | $ 7,351 | $ 7,614 | 15,493 | 22,844 |
Cash Paid for amounts included in measurement of lease liabilities | ||||
Operating cash flows from operating leases | $ 13,654 | $ 18,491 | ||
Weighted-average remaining lease term - operating leases | 6 years | 6 years | 6 years | 6 years |
Weighed-average discount rate - operating leases | 5.80% | 5.80% | 5.80% | 5.80% |
Leases - Future minimum lease p
Leases - Future minimum lease payments for operating leases (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jun. 30, 2019 |
Leases | ||
2019 (excluding the six and nine months ended June 30 and September 30, 2019) | $ 6,912 | $ 13,789 |
2020 | 22,098 | 21,510 |
2021 | 18,041 | 17,788 |
2022 | 15,593 | 15,198 |
2023 | 14,099 | 13,786 |
Thereafter | 35,824 | 36,054 |
Total operating lease payments | 112,567 | 118,125 |
Less imputed interest | (18,917) | (20,974) |
Total | $ 93,650 | $ 97,151 |
Leases - Future minimum annual
Leases - Future minimum annual rental payments under ASC 840 (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Leases | |
2019 | $ 22,140 |
2020 | 19,531 |
2021 | 17,240 |
2022 | 15,333 |
2023 | 14,944 |
Thereafter | 40,367 |
Total operating lease commitments | $ 129,555 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Leases | |||
Operating leases, options to extend | true | true | |
Operating leases, renewal lease term (in years) | 10 years | 10 years | |
Operating lease expense, not yet commenced | $ 1,713 | $ 5,840 | |
Operating lease liability under restoration | $ 4,155 | $ 4,097 | $ 4,100 |
Minimum | |||
Leases | |||
Operating leases, lease term (in years) | 1 year | 1 year | |
Maximum | |||
Leases | |||
Operating leases, lease term (in years) | 6 years | 6 years |
Computer Hardware and Other P_3
Computer Hardware and Other Property, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Computer Hardware and Other Property, Net. | ||||||||||
Computer hardware | $ 22,095 | $ 20,174 | $ 18,130 | $ 20,174 | $ 22,095 | $ 18,130 | $ 18,130 | $ 11,238 | ||
Leasehold improvements | 13,965 | 13,296 | 13,298 | 13,296 | 13,965 | 13,298 | 13,298 | 13,885 | ||
Furniture, fixtures and equipment | 6,326 | 6,574 | 6,816 | 6,574 | 6,326 | 6,816 | 6,816 | 6,768 | ||
Total computer hardware and other property | 42,386 | 40,044 | 38,244 | 40,044 | 42,386 | 38,244 | 38,244 | 31,891 | ||
Accumulated depreciation | (22,201) | (21,554) | (17,603) | (21,554) | (22,201) | (17,603) | (17,603) | (8,881) | ||
Total computer hardware and other property, net | 20,185 | 18,490 | 20,641 | 18,490 | 20,185 | 20,641 | 20,641 | 23,010 | ||
Depreciation | $ 2,281 | $ 2,131 | $ 3,291 | $ 3,249 | $ 4,182 | $ 4,650 | $ 6,463 | $ 7,941 | $ 9,422 | $ 6,997 |
Other Intangible Assets, net an
Other Intangible Assets, net and Goodwill (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill And Intangible Assets [Line Items] | |||||||||||
Finite-lived intangible assets, Gross | $ 2,318,048 | $ 2,318,048 | $ 2,308,208 | $ 2,286,085 | $ 2,308,208 | $ 2,318,048 | $ 2,286,085 | $ 2,286,085 | $ 2,268,610 | ||
Finite-lived intangible assets, Accumulated Amortization | (630,015) | (630,015) | (592,010) | (495,914) | (592,010) | (630,015) | (495,914) | (495,914) | (278,573) | ||
Finite-Lived Intangible Assets, Net, Total | 1,688,033 | 1,688,033 | 1,716,198 | 1,790,171 | 1,716,198 | 1,688,033 | 1,790,171 | 1,790,171 | 1,990,037 | ||
Indefinite-lived intangible, Gross | 2,486,361 | 2,486,361 | 2,476,531 | 2,454,434 | 2,476,531 | 2,486,361 | 2,454,434 | 2,454,434 | 2,438,660 | ||
Indefinite-lived intangible, Net, Total | 1,856,346 | 1,856,346 | 1,844,521 | 1,958,520 | 1,844,521 | 1,856,346 | 1,958,520 | 1,958,520 | 2,160,087 | ||
Amortization expense | 41,656 | 40,932 | 57,186 | $ 57,541 | 97,038 | $ 114,672 | 138,694 | 171,858 | $ 227,803 | 221,466 | |
Remaining Weighted-Average Amortization Period (in Years) | 13 years 10 months 24 days | ||||||||||
Minimum [Member] | |||||||||||
Goodwill And Intangible Assets [Line Items] | |||||||||||
Remaining Weighted-Average Amortization Period (in Years) | 2 years | ||||||||||
Maximum [Member] | |||||||||||
Goodwill And Intangible Assets [Line Items] | |||||||||||
Remaining Weighted-Average Amortization Period (in Years) | 20 years | ||||||||||
Trade names | |||||||||||
Goodwill And Intangible Assets [Line Items] | |||||||||||
Indefinite-lived intangible, Gross | 168,313 | 168,313 | 168,323 | 168,349 | 168,323 | 168,313 | 168,349 | $ 168,349 | 170,050 | ||
Indefinite-lived intangible, Net, Total | 168,313 | 168,313 | 168,323 | 168,349 | 168,323 | 168,313 | 168,349 | 168,349 | 170,050 | ||
Customer relationships | |||||||||||
Goodwill And Intangible Assets [Line Items] | |||||||||||
Finite-lived intangible assets, Gross | 288,026 | 288,026 | 290,984 | 291,503 | 290,984 | 288,026 | 291,503 | 291,503 | 299,886 | ||
Finite-lived intangible assets, Accumulated Amortization | (184,626) | (184,626) | (184,761) | (164,611) | (184,761) | (184,626) | (164,611) | (164,611) | (95,606) | ||
Finite-Lived Intangible Assets, Net, Total | 103,400 | 103,400 | 106,223 | 126,892 | 106,223 | 103,400 | 126,892 | $ 126,892 | 204,280 | ||
Increase (decrease) in Finite lived intangible assets | 1,000 | ||||||||||
Remaining Weighted-Average Amortization Period (in Years) | 10 years 7 months 6 days | ||||||||||
Databases and content | |||||||||||
Goodwill And Intangible Assets [Line Items] | |||||||||||
Finite-lived intangible assets, Gross | 1,721,623 | 1,721,623 | 1,724,802 | 1,725,878 | 1,724,802 | 1,721,623 | 1,725,878 | $ 1,725,878 | 1,733,304 | ||
Finite-lived intangible assets, Accumulated Amortization | (311,458) | (311,458) | (285,550) | (233,733) | (285,550) | (311,458) | (233,733) | (233,733) | (130,271) | ||
Finite-Lived Intangible Assets, Net, Total | 1,410,165 | 1,410,165 | 1,439,252 | 1,492,145 | 1,439,252 | 1,410,165 | 1,492,145 | $ 1,492,145 | 1,603,033 | ||
Remaining Weighted-Average Amortization Period (in Years) | 14 years 10 months 24 days | ||||||||||
Computer software | |||||||||||
Goodwill And Intangible Assets [Line Items] | |||||||||||
Finite-lived intangible assets, Gross | 308,399 | 308,399 | 292,422 | 268,704 | 292,422 | 308,399 | 268,704 | $ 268,704 | 235,420 | ||
Finite-lived intangible assets, Accumulated Amortization | (133,931) | (133,931) | (121,699) | (97,570) | (121,699) | (133,931) | (97,570) | (97,570) | (52,696) | ||
Finite-Lived Intangible Assets, Net, Total | 174,468 | $ 174,468 | $ 170,723 | $ 171,134 | $ 170,723 | $ 174,468 | $ 171,134 | $ 171,134 | $ 182,724 | ||
Increase (decrease) in Finite lived intangible assets | $ 2,500 | ||||||||||
Remaining Weighted-Average Amortization Period (in Years) | 4 years 10 months 24 days |
Identifiable Intangible Asset_3
Identifiable Intangible Assets, net - Estimated Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Intangible Assets, net and Goodwill | ||||||||||
Amortization amounted | $ 41,656 | $ 40,932 | $ 57,186 | $ 57,541 | $ 97,038 | $ 114,672 | $ 138,694 | $ 171,858 | $ 227,803 | $ 221,466 |
Estimated amortization for five succeeding years | ||||||||||
2019 | 176,545 | |||||||||
2020 | 158,807 | |||||||||
2021 | 149,326 | |||||||||
2022 | 117,865 | |||||||||
2023 | 113,545 | |||||||||
Thereafter | 1,036,411 | |||||||||
Subtotal finite-lived intangible assets | 1,752,499 | |||||||||
Internally developed software projects in process | 37,672 | |||||||||
Finite-Lived Intangible Assets, Net, Total | 1,688,033 | 1,716,198 | 1,790,171 | 1,716,198 | 1,688,033 | 1,790,171 | 1,790,171 | 1,990,037 | ||
Indefinite-lived intangible, Net, Total | 1,856,346 | 1,844,521 | $ 1,958,520 | 1,844,521 | 1,856,346 | 1,958,520 | 1,958,520 | 2,160,087 | ||
Goodwill | ||||||||||
Goodwill, Beginning Balance | 1,282,842 | 1,282,919 | $ 1,311,253 | 1,282,919 | $ 1,311,253 | 1,311,253 | 1,305,571 | |||
Changes due to foreign currency fluctuations | (77) | (1,415) | (512) | 90 | ||||||
Goodwill, Ending Balance | $ 1,281,504 | $ 1,282,842 | $ 1,282,842 | $ 1,281,504 | $ 1,282,919 | $ 1,311,253 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($)item | Dec. 31, 2017USD ($)item | |
Goodwill | |||||||
Goodwill, Beginning Balance | $ 1,282,919 | $ 1,311,253 | $ 1,282,919 | $ 1,311,253 | $ 1,311,253 | $ 1,305,571 | |
Acquisition | 21,527 | 9,767 | |||||
Measurement period adjustments | (4,175) | ||||||
Disposals | (49,349) | ||||||
Impact of foreign currency fluctuations and other | (77) | (1,415) | (512) | 90 | |||
Goodwill, Ending Balance | 1,282,842 | 1,281,504 | $ 1,282,919 | $ 1,311,253 | |||
Number of reporting unit | item | 5 | 1 | |||||
Decreased accounts receivable | 57,607 | 64,130 | 99,470 | 60,423 | $ (50,906) | $ 43,109 | |
Decreased other current liabilities | (28,827) | (32,008) | 3,388 | (17,539) | 9,842 | (6,038) | |
Decreased other non-current liabilities | (4,770) | $ (3,014) | (6,338) | $ (1,195) | 774 | $ 5,271 | |
The 2016 Transaction | |||||||
Goodwill | |||||||
Measurement period adjustments | $ 4,175 | ||||||
Increased computer hardware and other property | 3,925 | ||||||
Decreased accounts receivable | 614 | ||||||
Decreased other current liabilities | 360 | ||||||
Decreased other non-current liabilities | $ 504 | ||||||
Derwent Product Line | |||||||
Goodwill | |||||||
Goodwill, Beginning Balance | $ 130,381 | $ 130,381 | |||||
Goodwill, Ending Balance | $ 130,381 | ||||||
Carrying value (in Percentage) | 2.00% |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
May 31, 2019 | Apr. 30, 2019 | Feb. 28, 2018 | Mar. 31, 2017 | Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Interest rate swap | ||||||||||||||
Derivative Instruments | ||||||||||||||
Interest payments | $ 100,000 | $ 50,000 | $ 50,000 | $ 300,000 | ||||||||||
Noncurrent assets | Interest rate swap | ||||||||||||||
Derivative Instruments | ||||||||||||||
Fair value of interest rate swap asset | $ 3,644 | $ 1,107 | ||||||||||||
Interest Rate Derivative Assets, at Fair Value | 3,644 | |||||||||||||
Other non-current liabilities | Interest rate swap | ||||||||||||||
Derivative Instruments | ||||||||||||||
Interest Rate Derivative Liabilities, at Fair Value | $ 3,208 | $ 2,147 | $ 2,147 | $ 3,208 | 3,644 | |||||||||
Forward contracts | ||||||||||||||
Derivative Instruments | ||||||||||||||
Notional values | 0 | 0 | $ 0 | 0 | $ 0 | 0 | $ 0 | 36,639 | ||||||
Forward contracts | Maximum | ||||||||||||||
Derivative Instruments | ||||||||||||||
Derivative, Term of Contract | 6 months | |||||||||||||
Forward contracts | Minimum | ||||||||||||||
Derivative Instruments | ||||||||||||||
Derivative, Term of Contract | 1 month | |||||||||||||
Forward contracts | Other current assets | ||||||||||||||
Derivative Instruments | ||||||||||||||
Fair value of the forward contracts | 83 | |||||||||||||
Forward contracts | Accrued expenses and other current liabilities | ||||||||||||||
Derivative Instruments | ||||||||||||||
Fair value of the forward contracts | 0 | 0 | 0 | 0 | $ 0 | |||||||||
Revenues, net | Forward contracts | ||||||||||||||
Derivative Instruments | ||||||||||||||
Losses/(gains) on the forward contracts | $ 0 | $ 0 | $ 812 | $ (993) | $ 0 | $ (1,052) | $ 0 | $ (240) | $ 240 | $ (1,479) |
Derivative Instruments - Change
Derivative Instruments - Changes in AOCI (net of tax) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||||||||
Balance at the beginning | $ 1,356,654 | $ 990,772 | $ 1,050,607 | $ 1,151,548 | $ 1,220,799 | $ 1,286,106 | $ 1,050,607 | $ 1,286,106 | $ 1,050,607 | $ 1,286,106 | $ 1,286,106 | $ 1,505,361 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (4,724) | (3,861) | (2,427) | (5,504) | (7,631) | 1,032 | (12,317) | (1,357) | (8,626) | 17,454 | ||
Balance at the end | 1,372,507 | 1,356,654 | 990,772 | 1,098,104 | 1,151,548 | 1,220,799 | 1,356,654 | 1,151,548 | 1,372,507 | 1,098,104 | 1,050,607 | 1,286,106 |
AOCI (net of tax) related to cash flow hedges | ||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||||||||
Balance at the beginning | (2,147) | 1,698 | 3,644 | 6,330 | 4,605 | 1,107 | 3,644 | 1,107 | 3,644 | 1,107 | 1,107 | |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (1,271) | (4,247) | (2,376) | 651 | 1,797 | 3,786 | ||||||
Balance at the end | (3,208) | (2,147) | 1,698 | 7,054 | 6,330 | 4,605 | $ (2,147) | $ 6,330 | $ (3,208) | $ 7,054 | $ 3,644 | $ 1,107 |
Amount reclassified out of Other comprehensive income (loss) to net loss | AOCI (net of tax) related to cash flow hedges | ||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||||||||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | $ 210 | $ 402 | $ 430 | $ 73 | $ (72) | $ (288) |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) $ in Thousands | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Fair Value Measurements | ||||
Fair value of company's debt | $ 1,368,718 | $ 1,373,945 | $ 1,950,318 | |
Level 2 | ||||
Fair Value Measurements | ||||
Fair value of company's debt | $ 1,950,318 | $ 2,093,827 | ||
Foreign exchange contract | Discount Rate | Minimum | ||||
Fair Value Measurements | ||||
Discount Rate (as a percent) | 1.26 | |||
Foreign exchange contract | Discount Rate | Maximum | ||||
Fair Value Measurements | ||||
Discount Rate (as a percent) | 1.50 |
FAIR VALUE MEASUREMENTS - Asset
FAIR VALUE MEASUREMENTS - Assets and Liabilities Recorded at Fair Value on a Recurring Basis - Transfers of assets or liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value Measurements | ||||
Fair value assets, transfers from level 1 to level 2 | $ 0 | $ 0 | $ 0 | |
Fair value assets, transfers from level 2 to level 1 | 0 | 0 | 0 | |
Fair value liabilities, transfers from level 1 to level 2 | 0 | 0 | 0 | |
Fair value liabilities, transfers from level 2 to level 1 | 0 | 0 | 0 | |
Fair value assets, transfers into level 3 | 0 | 0 | 0 | |
Fair value assets, transfers out of level 3 | 0 | 0 | 0 | |
Fair value liabilities, transfers into level 3 | 0 | 0 | 0 | |
Fair value liabilities, transfers out of level 3 | $ 0 | $ 0 | 0 | |
Recurring | ||||
Fair Value Measurements | ||||
Fair value assets, transfers from level 1 to level 2 | 0 | $ 0 | ||
Fair value assets, transfers from level 2 to level 1 | 0 | 0 | ||
Fair value liabilities, transfers from level 1 to level 2 | 0 | 0 | ||
Fair value liabilities, transfers from level 2 to level 1 | 0 | 0 | ||
Fair value assets, transfers into level 3 | 0 | 0 | ||
Fair value assets, transfers out of level 3 | 0 | 0 | ||
Fair value liabilities, transfers into level 3 | 0 | 0 | ||
Fair value liabilities, transfers out of level 3 | $ 0 | $ 0 | ||
Recurring | Minimum | ||||
Fair Value Measurements | ||||
Specific milestones and performance metrics period (in years) | 1 year | 1 year | ||
Recurring | Maximum | ||||
Fair Value Measurements | ||||
Specific milestones and performance metrics period (in years) | 3 years | 3 years |
FAIR VALUE MEASUREMENTS - Input
FAIR VALUE MEASUREMENTS - Inputs and assumptions used to value the earn-out liability (Details) - Recurring | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
TrademarkVision | Risk free rate | ||
Inputs and assumptions | ||
Earn-out liability, Fair value input (as a percent) | 2.77 | |
TrademarkVision | Discount Rate | ||
Inputs and assumptions | ||
Earn-out liability, Fair value input (as a percent) | 8.09 | |
TrademarkVision | Expected life | ||
Inputs and assumptions | ||
Expected life (in years) | 1 year 6 months 15 days | |
Publons | Risk free rate | Minimum | ||
Inputs and assumptions | ||
Earn-out liability, Fair value input (as a percent) | 2.34 | 1.17 |
Publons | Risk free rate | Maximum | ||
Inputs and assumptions | ||
Earn-out liability, Fair value input (as a percent) | 2.63 | 1.62 |
Publons | Discount Rate | Minimum | ||
Inputs and assumptions | ||
Earn-out liability, Fair value input (as a percent) | 9.23 | 11.44 |
Publons | Discount Rate | Maximum | ||
Inputs and assumptions | ||
Earn-out liability, Fair value input (as a percent) | 9.72 | 11.90 |
Publons | Expected life | Minimum | ||
Inputs and assumptions | ||
Expected life (in years) | 1 year 15 days | 1 year 1 month 13 days |
Publons | Expected life | Maximum | ||
Inputs and assumptions | ||
Expected life (in years) | 3 years 15 days | 4 years 1 month 13 days |
FAIR VALUE MEASUREMENTS - Chang
FAIR VALUE MEASUREMENTS - Changes in the earn-out, Level 3 (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||||
Payment of Earn-out liability | $ (2,470) | $ (2,470) | ||||
Recurring | Level 3 | ||||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||||
Balance at the beginning of the period | $ 7,544 | $ 7,075 | $ 7,075 | $ 5,900 | 5,900 | |
Earn-out Liability | $ 5,900 | |||||
Business combinations | 4,115 | |||||
Payment of Earn-out liability | (2,470) | |||||
Revaluations included in earnings | 4,616 | 469 | 5,085 | (470) | ||
Balance at the end of the period | $ 12,160 | $ 7,544 | $ 12,160 | $ 7,075 |
FAIR VALUE MEASUREMENTS - Ass_2
FAIR VALUE MEASUREMENTS - Assets and liabilities that were recognized at fair value on a recurring basis (Details) - Recurring - USD ($) $ in Thousands | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Assets | ||||
Fair value of assets | $ 3,644 | $ 1,190 | ||
FINANCIAL LIABILITIES: | ||||
Fair value of liabilities | $ 15,368 | $ 9,691 | 7,075 | 5,900 |
Earn-out | ||||
FINANCIAL LIABILITIES: | ||||
Fair value of liabilities | 12,160 | 7,544 | 7,075 | 5,900 |
Interest rate swap | ||||
Assets | ||||
Fair value of assets | 3,644 | 1,107 | ||
FINANCIAL LIABILITIES: | ||||
Fair value of liabilities | 3,208 | 2,147 | ||
Forward contracts | ||||
Assets | ||||
Fair value of assets | 83 | |||
Level 2 | ||||
Assets | ||||
Fair value of assets | 3,644 | 1,190 | ||
FINANCIAL LIABILITIES: | ||||
Fair value of liabilities | 3,208 | 2,147 | ||
Level 2 | Interest rate swap | ||||
Assets | ||||
Fair value of assets | 3,644 | 1,107 | ||
FINANCIAL LIABILITIES: | ||||
Fair value of liabilities | 3,208 | 2,147 | ||
Level 2 | Forward contracts | ||||
Assets | ||||
Fair value of assets | 83 | |||
Level 3 | ||||
FINANCIAL LIABILITIES: | ||||
Fair value of liabilities | 12,160 | 7,544 | 7,075 | 5,900 |
Level 3 | Earn-out | ||||
FINANCIAL LIABILITIES: | ||||
Fair value of liabilities | $ 12,160 | $ 7,544 | $ 7,075 | $ 5,900 |
FAIR VALUE MEASUREMENTS - Non-F
FAIR VALUE MEASUREMENTS - Non-Financial Assets Valued on a Non-Recurring Basis (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Fair Value Measurements | |||
Impairments of long-lived assets | $ 0 | ||
Fair Value, Measurements, Nonrecurring [Member] | |||
Fair Value Measurements | |||
Impairments of long-lived assets | $ 0 | $ 0 | $ 0 |
Pension and Other Post-Retire_3
Pension and Other Post-Retirement Benefits - Defined contribution plans (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Pension and Other Post-Retirement Benefits | ||
Defined contribution plan expense | $ 13,170 | $ 12,488 |
Pension and Other Post-Retire_4
Pension and Other Post-Retirement Benefits - Projected benefit obligations, the plan assets, and the funded status (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Change in benefit obligation | ||||||||||
Projected benefit obligation at beginning of year | $ 14,486 | $ 14,258 | $ 14,486 | $ 14,258 | $ 14,258 | $ 13,621 | ||||
Service cost | $ 220 | $ 220 | $ 222 | $ 222 | 441 | 444 | 662 | 666 | 888 | 442 |
Interest cost | $ 80 | $ 80 | $ 71 | $ 71 | 158 | 142 | 238 | 213 | 283 | 168 |
Plan participant contributions | 109 | |||||||||
Actuarial (gain)/losses | 29 | (640) | ||||||||
Divestiture | (138) | |||||||||
Benefit payments | (274) | (123) | ||||||||
Expected return on plan assets | (35) | |||||||||
Effect of foreign currency translation | (634) | 790 | ||||||||
Projected benefit obligation at end of year | 14,486 | 14,258 | ||||||||
Change in plan assets | ||||||||||
Fair value of plan assets at beginning of year | $ 5,184 | $ 5,062 | $ 5,184 | $ 5,062 | 5,062 | 5,062 | ||||
Actual return on plan assets | 95 | |||||||||
Plan participant contributions | 109 | |||||||||
Employer contributions | 460 | 123 | ||||||||
Benefit payments | (274) | (123) | ||||||||
Expected return on plan assets | (35) | |||||||||
Effect of foreign currency translation | (233) | |||||||||
Fair value of plan assets at end of year | 5,184 | 5,062 | ||||||||
Unfunded status | $ (9,302) | $ (9,196) |
Pension and Other Post-Retire_5
Pension and Other Post-Retirement Benefits - Balance sheets presentation (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Pension and Other Post-Retirement Benefits | ||
Current liabilities | $ (443) | $ (342) |
Non current liabilities | (8,859) | (8,854) |
AOCI | $ (1,054) | $ (1,252) |
Pension and Other Post-Retire_6
Pension and Other Post-Retirement Benefits - Accumulated benefit obligation (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Plans with accumulated benefit obligation in excess of plan assets: | ||
Accumulated benefit obligation | $ 13,605 | $ 13,499 |
Fair value of plan assets | 5,184 | 5,062 |
Plans with projected benefit obligation in excess of plan assets: | ||
Projected benefit obligation | 14,486 | 14,258 |
Fair value of plan assets | $ 5,184 | $ 5,062 |
Pension and Other Post-Retire_7
Pension and Other Post-Retirement Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Pension and Other Post-Retirement Benefits | ||||||||||
Service cost | $ 220 | $ 220 | $ 222 | $ 222 | $ 441 | $ 444 | $ 662 | $ 666 | $ 888 | $ 442 |
Interest cost | 80 | 80 | 71 | 71 | 158 | 142 | 238 | 213 | 283 | 168 |
Expected return on plan assets | (40) | (40) | (37) | (37) | (80) | (75) | (120) | (112) | (150) | |
Amortization of actuarial gains | (20) | (20) | (19) | (19) | (38) | (39) | (49) | (57) | (78) | (4) |
Net periodic benefit cost | $ 240 | $ 240 | $ 237 | $ 237 | $ 481 | $ 472 | $ 731 | $ 710 | $ 943 | $ 606 |
Pension and Other Post-Retire_8
Pension and Other Post-Retirement Benefits - Periodic benefit cost assumptions (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | ||
Discount rate | 2.31% | 2.38% |
Expected return on plan assets | 3.00% | |
Rate of compensation increase | 3.76% | 4.56% |
Social Security increase rate | 2.50% | 2.50% |
Pension increase rate | 1.80% | 2.00% |
Pension and Other Post-Retire_9
Pension and Other Post-Retirement Benefits - Benefit obligations assumptions (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | ||
Discount rate | 2.26% | 2.31% |
Rate of compensation increase | 3.68% | 3.76% |
Social Security increase rate | 2.50% | 2.50% |
Pension increase rate | 1.80% | 1.80% |
Maximum | ||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | ||
Discount rate | 7.10% | 7.10% |
Minimum | ||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | ||
Discount rate | 0.40% | 0.45% |
Pension and Other Post-Retir_10
Pension and Other Post-Retirement Benefits - Plan assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined benefit plans | |||
Expected weighted-average long-term rate of return on plan assets | 3.00% | ||
Fair value measurement of pension plan assets: | |||
Fair value measurement of pension plan assets | $ 5,184 | $ 5,062 | $ 5,062 |
Insurance contract | |||
Defined benefit plans | |||
Plan asset investment | 100.00% | ||
Fair value measurement of pension plan assets: | |||
Fair value measurement of pension plan assets | $ 5,184 | 5,062 | |
Level 3 | Insurance contract | |||
Fair value measurement of pension plan assets: | |||
Fair value measurement of pension plan assets | $ 5,184 | $ 5,062 |
Pension and Other Post-Retir_11
Pension and Other Post-Retirement Benefits - Estimated pension benefit payments (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Defined Benefit Plan, Expected Future Benefit Payment [Abstract] | |
2019 | $ 488 |
2020 | 610 |
2021 | 489 |
2022 | 643 |
2023 | 781 |
Years 2024 - 2027 | 4,923 |
Total | 7,934 |
Estimated payments in 2019 | $ 274 |
Debt - Summary of Debt (Details
Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Oct. 03, 2016 |
Debt | |||||
Total debt outstanding | $ 1,342,484 | $ 1,346,320 | $ 2,028,993 | $ 2,060,700 | |
Debt issuance costs | (20,038) | (21,201) | (34,838) | (43,086) | |
Term Loan Facility, discount | (1,737) | (1,855) | (3,633) | (4,534) | |
Short-term debt, including current portion of long-term debt | (60,345) | ||||
Long-term debt, net of current portion and debt issuance costs | 1,305,364 | 1,307,919 | $ 1,930,177 | $ 1,967,735 | |
Weighted average interest rate | 6.259% | 5.473% | |||
Current Portion of Long-Term Debt | $ (15,345) | $ (15,345) | $ (60,345) | $ (45,345) | |
Senior Unsecured Notes | |||||
Debt | |||||
Effective Interest Rate | 7.875% | 7.875% | 7.875% | 7.875% | 7.875% |
Total debt outstanding | $ 500,000 | $ 500,000 | $ 500,000 | $ 500,000 | $ 500,000 |
Term Loan Facility | |||||
Debt | |||||
Effective Interest Rate | 5.294% | 5.652% | 5.729% | 4.70% | |
Total debt outstanding | $ 842,484 | $ 846,320 | $ 1,483,993 | $ 1,530,700 | 1,550,000 |
Debt issuance costs | $ (64,888) | ||||
The Revolving Credit Facility 1 | |||||
Debt | |||||
Effective Interest Rate | 5.754% | ||||
Total debt outstanding | $ 5,000 | ||||
The Revolving Credit Facility 2 | |||||
Debt | |||||
Effective Interest Rate | 5.729% | 4.751% | |||
Total debt outstanding | $ 40,000 | $ 30,000 |
Debt - Summary of Debt - Senior
Debt - Summary of Debt - Senior Unsecured Notes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2017 | Oct. 03, 2016 | |
Debt | |||||
Total debt outstanding | $ 2,028,993 | $ 1,342,484 | $ 1,346,320 | $ 2,060,700 | |
Senior Unsecured Notes | |||||
Debt | |||||
Total debt outstanding | $ 500,000 | $ 500,000 | $ 500,000 | $ 500,000 | $ 500,000 |
Interest Rate | 7.875% | 7.875% | 7.875% | 7.875% | 7.875% |
Redemption (as a percent) | 100.00% | ||||
Changes in control (as a percent) | 101.00% | ||||
Redemption Price (as a percentage of principal) | 100.00% |
Debt - Summary of Debt - Seni_2
Debt - Summary of Debt - Senior Unsecured Notes - Redemption Price (Details) | 12 Months Ended |
Dec. 31, 2018 | |
2019 | |
Debt Instrument, Redemption | |
Redemption Price (as a percentage of principal) | 103.938% |
2020 | |
Debt Instrument, Redemption | |
Redemption Price (as a percentage of principal) | 101.969% |
2021 and thereafter | |
Debt Instrument, Redemption | |
Redemption Price (as a percentage of principal) | 100.00% |
Debt - Summary of Debt - Seni_3
Debt - Summary of Debt - Senior Secured Credit Facility (Details) $ in Thousands | Nov. 16, 2017 | Apr. 06, 2017 | Oct. 03, 2016USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Debt | |||||||
Aggregate principal amount | $ 1,346,320 | $ 1,342,484 | $ 2,028,993 | $ 2,060,700 | |||
Deferred financing fees | $ 21,201 | $ 20,038 | 34,838 | 43,086 | |||
Debt issuance costs and debt discounts | 38,471 | ||||||
Repayment outstanding borrowings period (in month) | 12 months | 12 months | |||||
Write Down Of Deferred Financing Fees | $ 7,718 | $ 7,718 | |||||
Write-downs of original issues discount | 1,406 | 1,406 | |||||
Debt Instrument, Fair Value Disclosure | 1,373,945 | 1,368,718 | 1,950,318 | ||||
Term Loan Facility | |||||||
Debt | |||||||
Aggregate principal amount | $ 1,550,000 | 846,320 | 842,484 | 1,483,993 | 1,530,700 | ||
interest rates increase (decrease) | 0.10% | ||||||
Deferred financing fees | $ 64,888 | ||||||
Redemption (as a percent) | 0.25% | ||||||
Excess cash payment | 31,378 | ||||||
Repayments of debt | 630,000 | 630,000 | |||||
Revolving Credit Facility | |||||||
Debt | |||||||
Aggregate principal amount | $ 175,000 | 45,000 | 30,000 | ||||
Collateralized amount | 1,985 | 1,935 | 2,002 | ||||
Repayments of debt | 20,000 | 20,000 | |||||
Additional Repayment Of Debt | 30,000 | 30,000 | |||||
Letter of credit | |||||||
Debt | |||||||
Sublimit | 25,000 | ||||||
Collateralized amount | 38 | 36 | 38 | ||||
Amended Term Loan Facility | |||||||
Debt | |||||||
Aggregate principal amount | 1,534,539 | ||||||
interest rates increase (decrease) | 0.10% | 0.10% | |||||
Redemption (as a percent) | 101.00% | 101.00% | |||||
Debt issuance costs and debt discounts | $ 13,892 | ||||||
Percentage of step-down in margin | 0.25 | ||||||
Senior Unsecured Notes | |||||||
Debt | |||||||
Aggregate principal amount | 500,000 | 500,000 | 500,000 | $ 500,000 | $ 500,000 | ||
Redemption (as a percent) | 100.00% | ||||||
Collateralized amount | $ 9,639 | $ 9,639 | $ 9,639 | ||||
Camelot Finance LP | Term Loan Facility | |||||||
Debt | |||||||
Aggregate principal amount | 651,000 | ||||||
Camelot Cayman LP | Term Loan Facility | |||||||
Debt | |||||||
Aggregate principal amount | $ 899,000 | ||||||
LIBOR | Revolving Credit Facility | |||||||
Debt | |||||||
Interest rate spread (as a percentage) | 3.25% | ||||||
LIBOR | Amended Term Loan Facility | |||||||
Debt | |||||||
Interest rate spread (as a percentage) | 3.25% | 3.50% | |||||
Debt instrument interest rate (as a percentage) | 0.10% | 0.10% | |||||
Prime | Revolving Credit Facility | |||||||
Debt | |||||||
Interest rate spread (as a percentage) | 2.25% | ||||||
Prime | Amended Term Loan Facility | |||||||
Debt | |||||||
Interest rate spread (as a percentage) | 2.25% | 2.25% |
Debt - Summary of Debt - Seni_4
Debt - Summary of Debt - Senior Secured Credit Facility - Outstanding borrowings (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Debt | ||||
2019 | $ 60,345 | |||
2020 | 15,345 | |||
2021 | 15,345 | |||
2022 | 15,345 | |||
2023 | 1,422,613 | |||
Thereafter | 500,000 | |||
Total debt outstanding | $ 1,342,484 | $ 1,346,320 | 2,028,993 | $ 2,060,700 |
Less: capitalized debt issuance costs and original issue discount | (38,471) | |||
Long-term Debt, Total | $ 1,990,522 |
Revenue - Disaggregated Revenue
Revenue - Disaggregated Revenues and Cost to Obtain a Contract (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of revenues | ||||||||||
Total revenues, gross | $ 243,065 | $ 242,440 | $ 243,422 | $ 244,210 | $ 476,629 | $ 482,704 | $ 719,694 | $ 726,126 | $ 971,620 | $ 967,307 |
Deferred revenues adjustment | (67) | (131) | (525) | (913) | (295) | (2,380) | (362) | (2,905) | (3,152) | (49,673) |
Total Revenues, net | 242,998 | 242,309 | 242,897 | 243,297 | 476,334 | 480,324 | 719,332 | 723,221 | 968,468 | 917,634 |
Amortization expense | 9,995 | 4,335 | ||||||||
Prepaid expenses | ||||||||||
Disaggregation of revenues | ||||||||||
Prepaid sales commissions | 10,407 | 8,285 | ||||||||
Noncurrent assets | ||||||||||
Disaggregation of revenues | ||||||||||
Prepaid sales commissions | 9,493 | 5,457 | ||||||||
Subscription revenues | ||||||||||
Disaggregation of revenues | ||||||||||
Total revenues, gross | 200,813 | 202,747 | 204,305 | 199,481 | 395,239 | 392,106 | 596,052 | 596,411 | 794,097 | 785,717 |
Transaction revenues | ||||||||||
Disaggregation of revenues | ||||||||||
Total revenues, gross | $ 42,252 | $ 39,693 | $ 39,117 | $ 44,729 | $ 81,390 | $ 90,598 | $ 123,642 | $ 129,715 | $ 177,523 | $ 181,590 |
Revenue - Contract Balances and
Revenue - Contract Balances and Transaction Price Allocated to the Remaining Performance Obligation (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounts receivables | ||||
Accounts receivables - Opening | $ 331,295 | $ 331,295 | $ 317,808 | $ 361,586 |
Accounts receivables - Closing | 270,584 | 226,997 | 331,295 | 317,808 |
Accounts receivables - (Increase)/decrease | 60,711 | 104,298 | (13,487) | 43,778 |
Current portion of deferred revenues | ||||
Current portion of deferred revenues - Opening | 391,102 | 391,102 | 361,260 | 333,944 |
Current portion of deferred revenues - Closing | 404,753 | 330,786 | 391,102 | 361,260 |
(Increase)/decrease in Contract With Customer, Current Liability | (13,651) | 60,316 | (29,842) | (27,316) |
Non-current portion of deferred revenues | ||||
Non-current portion of deferred revenues - Opening | 17,112 | 17,112 | 15,796 | 18,602 |
Non-current portion of deferred revenues - Closing | 22,236 | 21,299 | 17,112 | 15,796 |
(Increase)/Decrease In Contract With Customer, Non Current Liability | $ (5,124) | $ (4,187) | $ (1,316) | $ 2,806 |
Revenue - Transaction Price All
Revenue - Transaction Price Allocated to the Remaining Performance Obligation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Contract with Customer, Liability | $ 163,607 | $ 163,607 | $ 210,784 | $ 361,260 |
Deferred Revenue Recognized In Future | $ 66,211 | $ 66,211 | $ 66,723 | $ 68,394 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | |||
Percentage of remaining performance obligation | 63.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-07-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | 12 months | ||
Percentage of remaining performance obligation | 64.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 12 months | |||
Percentage of remaining performance obligation | 67.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-01-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | 1 year | 12 months | |
Percentage of remaining performance obligation | 21.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-07-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Percentage of remaining performance obligation | 23.00% | |||
Percentage of remaining performance obligation beginning the following year | 8 years | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 1 year | |||
Percentage of remaining performance obligation | 21.00% | |||
Percentage of remaining performance obligation beginning the following year | 33.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 3 years | |||
Percentage of remaining performance obligation | 16.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 3 years | 3 years | ||
Percentage of remaining performance obligation | 13.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 3 years | |||
Percentage of remaining performance obligation | 12.00% | 37.00% | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-07-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Percentage of remaining performance obligation | 36.00% | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 9 years | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2029-07-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 10 years | 10 years | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2029-10-01 | ||||
Transaction Price Allocated to the Remaining Performance Obligation | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period | 10 years |
Shareholders' Equity (Details)
Shareholders' Equity (Details) | May 13, 2019shares | Sep. 30, 2018shares | Jun. 30, 2018shares | Jun. 30, 2019$ / sharesshares | Jun. 30, 2018shares | Sep. 30, 2019item$ / sharesshares | Sep. 30, 2018shares | Dec. 31, 2018$ / sharesshares | Dec. 31, 2017$ / sharesshares |
Shareholders' Equity | |||||||||
Subscribed number of shares | 13,347 | 46,247 | 174,420 | 187,766 | 198,602 | 1,218,300 | |||
Issued and outstanding | 87,749,999 | 87,749,999 | |||||||
Common Stock, Shares, Issued | 305,268,497 | 306,050,763 | 217,526,425 | 217,327,823 | |||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 1,500,000 | ||||||||
Common Stock, Shares, Outstanding | 305,268,497 | 306,050,763 | 217,526,425 | 217,327,823 | |||||
Treasury Stock, Shares | 0 | 0 | 0 | ||||||
Merger, Conversion Ratio | 0.00757 | 0.00757 | 0.00757 | ||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0 | $ 0 | $ 0 | $ 0 | |||||
Common Stock, Votes Per Share | 1 | 1 | |||||||
Completion of transaction (in days) | 30 days | 30 days | |||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 52,800,000 | 52,800,000 | 52,800,000 | ||||||
Number of warrants exercised | item | 0 | ||||||||
Sponsor Agreement [Member] | |||||||||
Shareholders' Equity | |||||||||
Common Stock, Shares, Issued | 7,000,000 | 7,000,000 | |||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 20 | $ 20 | |||||||
Minimum | |||||||||
Shareholders' Equity | |||||||||
Warrants, Beneficial Interest | 4.90% | 4.90% | |||||||
Consecutive Trading Day Period | 40 days | 40 days | |||||||
Maximum | |||||||||
Shareholders' Equity | |||||||||
Warrants, Beneficial Interest | 9.80% | 9.80% | |||||||
Consecutive Trading Day Period | 60 days | 60 days | |||||||
Churchill public shareholders | |||||||||
Shareholders' Equity | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 68,999,999 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 11.50 | $ 11.50 | |||||||
Common Class A [Member] | |||||||||
Shareholders' Equity | |||||||||
Common Stock, Shares, Issued | 68,999,999 | 68,999,999 | |||||||
Common Stock, Shares, Outstanding | 68,999,999 | 68,999,999 | |||||||
Common Class B [Member] | |||||||||
Shareholders' Equity | |||||||||
Common Stock, Shares, Issued | 18,750,000 | 18,750,000 | |||||||
Common Stock, Shares, Outstanding | 18,750,000 | 18,750,000 | |||||||
Share Capital | |||||||||
Shareholders' Equity | |||||||||
Shares granted | 6 | 66,068 | |||||||
Issued and outstanding | 1,482,969 | ||||||||
Management Incentive Plan | |||||||||
Shareholders' Equity | |||||||||
Vesting period | 5 years | 5 years | 5 years |
Employment and Compensation A_3
Employment and Compensation Arrangements (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Employment and Compensation Arrangements | ||||||||||
Share-based compensation expense | $ 9,567 | $ 33,932 | $ 3,660 | $ 2,842 | $ 37,108 | $ 7,022 | $ 46,675 | $ 10,682 | $ 13,715 | $ 17,663 |
Tax benefits | $ 45 | $ 85 | $ 96 | $ 85 | $ 163 | $ 192 | $ 201 | $ 288 | $ 2,740 | $ 3,192 |
Authorized grants | 60,000,000 | 60,000,000 | 60,000,000 | 60,000,000 | 33,034,167 | |||||
Stock options not granted | 8,509,469 | 10,479,363 | ||||||||
Unrecognized compensation cost | $ 8,934 | $ 12,971 | $ 12,971 | $ 8,934 | $ 19,637 | $ 29,633 | ||||
Recognition period of unrecognized compensation cost | 2 years 8 months 12 days | 2 years 6 months | 5 years | |||||||
Management Incentive Plan | ||||||||||
Employment and Compensation Arrangements | ||||||||||
Vesting period | 5 years | 5 years | 5 years | |||||||
Equity Incentive Plan2016 [Member] | ||||||||||
Employment and Compensation Arrangements | ||||||||||
Stock options not granted | 37,043,548 | 34,747,066 | 34,747,066 | 37,043,548 |
Employment and Compensation A_4
Employment and Compensation Arrangements - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of Options | ||||
Outstanding at beginning of year | 24,524,698 | 24,524,698 | 22,554,804 | |
Modified options | 22,384,111 | |||
Granted | 2,321,360 | 2,321,360 | 4,119,737 | |
Forfeited and expired | (2,149,843) | |||
Outstanding at end of year | 25,252,934 | 22,956,452 | 24,524,698 | 22,554,804 |
Vested and exercisable | 13,768,097 | 14,374,000 | 6,654,930 | |
Forfeited | (1,296,615) | (2,268,238) | ||
Expired | (278,011) | (820,612) | ||
Modified options | 24,339,097 | 24,339,097 | ||
Weighted Average Exercise Price Per Share | ||||
Outstanding at beginning of year | $ 12.44 | $ 12.44 | $ 12.32 | |
Granted | 17.72 | 17.55 | 11.73 | |
Forfeited and expired | 11.15 | |||
Outstanding at end of year | 11.28 | 11.96 | 12.44 | $ 12.32 |
Vested and exercisable | 10.35 | 11.52 | $ 10.92 | |
Forfeited | 10.95 | 11.24 | ||
Exercised | 7.41 | 6.66 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Expirations in Period, Weighted Average Exercise Price | $ 11.13 | $ 8.54 | ||
Weighted Average Remaining Contractual Life | ||||
Outstanding at beginning of year | 8 years 3 months 18 days | 7 years 10 months 24 days | 8 years 6 months | 9 years 3 months 18 days |
Granted | 7 years 9 months 18 days | 9 years 6 months | 9 years 8 months 12 days | |
Outstanding at end of year | 8 years 3 months 18 days | 7 years 10 months 24 days | 8 years 6 months | 9 years 3 months 18 days |
Vested and exercisable | 7 years 7 months 6 days | 7 years 8 months 12 days | 8 years 3 months 18 days | |
Aggregate Intrinsic Value | ||||
Outstanding at beginning of year | $ 13,293 | $ 13,293 | $ 2,262 | |
Outstanding at end of year | 111,373 | 146,085 | 13,293 | $ 2,262 |
Vested and exercisable | 63,761 | 79,377 | $ 3,880 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 147 | $ 8,106 | ||
Exercised options | 18,498 | 800,756 | 0 | 0 |
Weighted-average fair value of options granted per share | $ 7.78 | $ 9.54 | $ 1.56 | $ 1.76 |
Originally Reported [Member] | ||||
Number of Options | ||||
Outstanding at beginning of year | 185,601 | 185,601 | 170,693 | |
Outstanding at end of year | 185,601 | 170,693 | ||
Weighted Average Exercise Price Per Share | ||||
Outstanding at beginning of year | $ 1,587 | $ 1,587 | $ 1,572 | |
Outstanding at end of year | $ 1,587 | $ 1,572 | ||
Weighted Average Remaining Contractual Life | ||||
Outstanding at beginning of year | 8 years 6 months | 9 years 3 months 18 days | ||
Outstanding at end of year | 8 years 6 months | 9 years 3 months 18 days | ||
Aggregate Intrinsic Value | ||||
Outstanding at beginning of year | $ 13,293 | $ 13,293 | $ 2,262 | |
Outstanding at end of year | $ 13,293 | $ 2,262 |
Employment and Compensation A_5
Employment and Compensation Arrangements - Assumptions (Details) | 6 Months Ended | 9 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Employment and Compensation Arrangements | ||||
Weighted-average expected dividend yield | 0.00% | 0.00% | ||
Expected volatility - Minimum | 21.00% | 24.84% | ||
Expected volatility - Maximum | 23.05% | 27.90% | ||
Weighted-average expected volatility | 19.87% | 19.87% | 21.86% | 27.50% |
Weighted-average risk-free interest rate | 2.43% | 2.43% | 3.02% | 2.53% |
Expected life (in years) | 8 years 6 months | 9 years | ||
Employee Stock Option | ||||
Employment and Compensation Arrangements | ||||
Vesting period | 5 years | 5 years | 5 years | |
Maximum | ||||
Employment and Compensation Arrangements | ||||
Contractual term | 10 years | 10 years | 10 years | |
Expected life (in years) | 9 years | 9 years | ||
Minimum | ||||
Employment and Compensation Arrangements | ||||
Contractual term | 1 year | 1 year | 1 year | |
Expected life (in years) | 5 years | 5 years |
Employment and Compensation A_6
Employment and Compensation Arrangements - Transactions Related Awards (Details) $ / shares in Units, $ in Thousands | Sep. 10, 2019shares | Aug. 14, 2019 | Sep. 30, 2019USD ($)$ / sharesshares | Jun. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($)installment$ / sharesshares | Jun. 30, 2018USD ($) | Sep. 30, 2019USD ($)installment$ / sharesshares | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Employment and Compensation Arrangements | |||||||||||||
Share-based compensation expense | $ 9,567 | $ 33,932 | $ 3,660 | $ 2,842 | $ 37,108 | $ 7,022 | $ 46,675 | $ 10,682 | $ 13,715 | $ 17,663 | |||
Aggregate purchase of shares | shares | 34,500,000 | ||||||||||||
Aggregate purchase price of shares | $ 141 | $ 137 | $ 50 | $ 355 | $ 1,014 | $ 1,574 | $ 9,558 | ||||||
Risk-free interest rate | 2.43% | 2.43% | 3.02% | 2.53% | |||||||||
Expected dividend rate | 0.00% | 0.00% | |||||||||||
Minimum [Member] | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Number of year lock-up for closing of mergers | 2 years | ||||||||||||
Maximum [Member] | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Number of year lock-up for closing of mergers | 3 years | ||||||||||||
Management Incentive Plan | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period | 5 years | 5 years | 5 years | ||||||||||
Performance Shares | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Share-based compensation expense | $ 25,013 | $ 25,013 | |||||||||||
Risk-free interest rate | 1.42% | 2.20% | 2.20% | ||||||||||
Expected volatility | 20.00% | 20.00% | 20.00% | ||||||||||
Expected dividend rate | 0.00% | 0.00% | 0.00% | ||||||||||
Discount for lack or marketability percentage, minimum | 3.00% | 3.00% | 3.00% | ||||||||||
Discount for lack or marketability percentage, maximum | 7.00% | 7.00% | 7.00% | ||||||||||
Performance Shares | Management Incentive Plan | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Increase (decrease) in value of share during the period | $ 48,102 | $ 48,102 | |||||||||||
Performance Shares | Common Class B [Member] | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Aggregate purchase of shares | shares | 1,500,000 | 1,500,000 | |||||||||||
Aggregate purchase price of shares | $ 15,000 | $ 15,000 | |||||||||||
Performance Shares | Ordinary Shares In Sponsor Agreement One | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Number of shares non-vested oustanding | shares | 5,309,713 | 5,309,713 | 5,309,713 | 5,309,713 | |||||||||
Number of installements for vesting | installment | 3 | 3 | |||||||||||
Increase (decrease) in value of share during the period | $ 1,193 | $ 1,193 | |||||||||||
Performance Shares | Ordinary Shares In Sponsor Agreement Two | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Number of shares non-vested oustanding | shares | 2,654,856 | 2,654,856 | 2,654,856 | 2,654,856 | |||||||||
Exercise price | $ / shares | $ 15.25 | $ 15.25 | $ 15.25 | $ 15.25 | |||||||||
Vesting period | 42 months | 42 months | |||||||||||
Increase (decrease) in value of share during the period | $ (9,396) | $ (9,396) | |||||||||||
Performance Shares | Ordinary Shares In Sponsor Agreement Three | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Number of shares non-vested oustanding | shares | 2,654,856 | 2,654,856 | 2,654,856 | 2,654,856 | |||||||||
Exercise price | $ / shares | $ 17.50 | $ 17.50 | $ 17.50 | $ 17.50 | |||||||||
Increase (decrease) in value of share during the period | $ (13,101) | $ (13,101) | |||||||||||
Performance Shares | Warrants In Sponsor Agreement | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Number of warrants non-vested outstanding | shares | 17,265,826 | 17,265,826 | 17,265,826 | 17,265,826 | |||||||||
Increase (decrease) in value of share during the period | $ (6,297) | $ (6,297) | |||||||||||
Performance Shares | Founder | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Increase (decrease) in value of share during the period | $ 4,411 | $ 4,411 | |||||||||||
Performance Shares | First anniversary | Ordinary Shares In Sponsor Agreement Two | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 0.00% | ||||||||||||
Performance Shares | First anniversary | Ordinary Shares In Sponsor Agreement Three | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 0.00% | ||||||||||||
Performance Shares | First anniversary | Warrants In Sponsor Agreement | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 0.00% | 0.00% | |||||||||||
Performance Shares | Second anniversary | Ordinary Shares In Sponsor Agreement Two | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 33.33% | ||||||||||||
Performance Shares | Second anniversary | Warrants In Sponsor Agreement | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 33.33% | 33.33% | |||||||||||
Performance Shares | Third anniversary | Ordinary Shares In Sponsor Agreement Two | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 66.67% | ||||||||||||
Performance Shares | Third anniversary | Ordinary Shares In Sponsor Agreement Three | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 66.67% | ||||||||||||
Performance Shares | Third anniversary | Warrants In Sponsor Agreement | |||||||||||||
Employment and Compensation Arrangements | |||||||||||||
Vesting period for warrants | 66.67% | 66.67% |
Tax Receivable Agreement (Detai
Tax Receivable Agreement (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended |
Jun. 30, 2019 | Sep. 30, 2019 | |
Tax Receivable Agreement | ||
Tax receivable agreement | $ 264,600 | $ 264,600 |
Percentage payment of calculated tax savings to pre-business combination equity holders | 85.00% | 85.00% |
Total maximum payments related to the TRA | $ 507,326 | $ 507,326 |
Deferred tax receivable agreement | 30,000 | 30,000 |
Maximum charges under the TRA as a result of basis adjustments under the Internal Revenue Code | 134,377 | 134,377 |
Maximum charges under the TRA related to the utilization of NOL and credit carryforwards | $ 108,350 | 108,350 |
Tax receivable agreement termination payment | $ 200,000 |
Income Taxes - Income tax (bene
Income Taxes - Income tax (benefit)/expense on income/(loss)by jurisdiction (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes | ||||||||||
Total current | $ 20,616 | $ 14,445 | ||||||||
Total deferred | $ (4,603) | $ (3,722) | $ (8,222) | $ (7,204) | (14,967) | (35,738) | ||||
Income tax expense | $ 1,644 | $ 3,712 | $ 3,244 | $ 11 | $ 3,952 | $ 357 | $ 5,596 | $ 3,601 | 5,649 | (21,293) |
U.K. | ||||||||||
Income Taxes | ||||||||||
U.K., Current | 1,014 | (142) | ||||||||
U.K., Deferred | 85 | (427) | ||||||||
U.S. | ||||||||||
Income Taxes | ||||||||||
U.S. Federal, Current | 6,395 | 5,202 | ||||||||
U.S. State, Current | 2,146 | 833 | ||||||||
U.S. Federal, Deferred | (5,465) | (10,648) | ||||||||
U.S. State, Deferred | (227) | (142) | ||||||||
Other | ||||||||||
Income Taxes | ||||||||||
Other, Current | 11,061 | 8,552 | ||||||||
Other, Deferred | $ (9,360) | $ (24,521) |
Income Taxes - Components of pr
Income Taxes - Components of pre-tax loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes | ||||||||||
Pre-tax loss | $ (12,475) | $ 74,049 | $ 51,483 | $ 66,933 | $ 133,069 | $ 143,624 | $ 120,594 | $ 195,107 | $ (236,513) | $ (285,223) |
U.K. | ||||||||||
Income Taxes | ||||||||||
Pre-tax loss | (222,043) | (211,944) | ||||||||
U.S. | ||||||||||
Income Taxes | ||||||||||
Pre-tax loss | (11,880) | (58,054) | ||||||||
Other | ||||||||||
Income Taxes | ||||||||||
Other loss | $ (2,590) | $ (15,225) |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of the statutory tax rate to effective tax rate (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
RATE | ||||||||||
Loss before tax: | $ 12,475 | $ (74,049) | $ (51,483) | $ (66,933) | $ (133,069) | $ (143,624) | $ (120,594) | $ (195,107) | $ (236,513) | $ (285,223) |
Income tax, at the statutory rate | $ (44,937) | $ (54,905) | ||||||||
Income tax expense based on federal statutory rate | 19.00% | 19.30% | ||||||||
Effect of different tax rates | (1.20%) | 3.30% | ||||||||
Tax rate modifications | 5.70% | |||||||||
Valuation Allowances | (18.00%) | (20.80%) | ||||||||
Permanent differences | (0.70%) | 0.30% | ||||||||
Withholding tax | (0.20%) | (0.30%) | ||||||||
Tax indemnity | (2.70%) | |||||||||
Sale of Subsidiary | 2.20% | |||||||||
Other | (0.80%) | |||||||||
Effective rate | (2.40%) | 7.50% |
Income taxes - Tax effects of t
Income taxes - Tax effects of the significant components of temporary differences (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Income Taxes | ||
Accounts Receivable | $ 916 | $ 1,310 |
Goodwill | 1,217 | |
Fixed assets, net | 1,670 | |
Accrued expenses | 3,735 | 3,417 |
Deferred revenues | 3,570 | 915 |
Other assets | 9,655 | 4,700 |
Unrealized gain/loss | 74 | 528 |
Debt issuance costs | 1,199 | |
Operating losses and tax attributes | 135,219 | 94,571 |
Total deferred tax assets | 154,368 | 108,328 |
Valuation allowances | (133,856) | (92,812) |
Net deferred tax assets | 20,512 | 15,516 |
Other identifiable intangible assets, net | (43,247) | (57,082) |
Other liabilities | (7,785) | (3,286) |
Goodwill | (42) | |
Fixed Assets, net | (238) | |
Debt Issuance Costs | (116) | |
Total deferred tax liabilities | (51,312) | (60,484) |
Net deferred tax liabilities | $ (30,800) | $ (44,968) |
Income taxes - Balance Sheet Pr
Income taxes - Balance Sheet Presentation (Details) - USD ($) $ in Thousands | Dec. 22, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2019 | Jun. 30, 2019 |
Income Tax Disclosure [Line Items] | |||||
Deferred tax asset | $ 12,426 | $ 6,824 | |||
Deferred tax liability | (43,226) | (51,792) | $ (39,256) | $ (42,582) | |
Net deferred tax liability | $ (30,800) | $ (44,968) | |||
US federal corporate income tax rate | 19.00% | 19.30% | |||
U.S. | |||||
Income Tax Disclosure [Line Items] | |||||
US federal corporate income tax rate | 35.00% | 21.00% | 21.00% |
Income taxes - SAB 118 (Details
Income taxes - SAB 118 (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Income Taxes | |
Provision benefit under SAP 118 | $ 2,237 |
Income taxes - Deferred tax ass
Income taxes - Deferred tax assets and liabilities (Details) - USD ($) $ in Thousands | Dec. 22, 2017 | Dec. 31, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Line Items] | |||
Income tax rate | 19.00% | 19.30% | |
Provisional tax benefit | $ 2,237 | ||
Deferred tax asset valuation allowance | 133,856 | $ 92,812 | |
Valuation allowance increase | 41,044 | $ 44,633 | |
Tax loss carryforwards | 67,823 | ||
Earnings from income taxes and withholding taxes | 7,748 | ||
U.K. | |||
Income Tax Disclosure [Line Items] | |||
Tax loss carryforwards | $ 352,632 | ||
U.S. | |||
Income Tax Disclosure [Line Items] | |||
Income tax rate | 35.00% | 21.00% | 21.00% |
Provisional tax benefit | $ 2,237 | ||
Tax loss carryforwards | $ 104,122 | ||
Operating loss expiration period | 20 years | ||
BELGIUM | |||
Income Tax Disclosure [Line Items] | |||
Income tax rate | 25.00% | ||
Change in corporate tax rate | $ 14,290 | ||
JAPAN | |||
Income Tax Disclosure [Line Items] | |||
Tax loss carryforwards | $ 58,901 | ||
Operating loss expiration period | 9 years | ||
Other | |||
Income Tax Disclosure [Line Items] | |||
Tax loss carryforwards | $ 18,495 |
Income Taxes - Uncertain Tax Po
Income Taxes - Uncertain Tax Positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Uncertain tax positions | ||
Accrued interest and penalties | $ 449 | $ 5 |
Balance at the Beginning of the year | 91 | 211 |
Increases for tax positions taken in prior years | 1,339 | |
Increases for tax positions taken in the current year | 72 | |
Decreases due to statute expirations | 52 | 120 |
Balance at the End of the year | 1,450 | $ 91 |
Minimum | ||
Uncertain tax positions | ||
Reasonable change of unrecognized tax benefits in the next 12 months | 0 | |
Maximum | ||
Uncertain tax positions | ||
Reasonable change of unrecognized tax benefits in the next 12 months | $ 252 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes | ||||||||||
Provision for income taxes | $ (1,644) | $ (3,712) | $ (3,244) | $ (11) | $ (3,952) | $ (357) | $ (5,596) | $ (3,601) | $ (5,649) | $ 21,293 |
Loss before income tax | $ 12,475 | $ (74,049) | $ (51,483) | $ (66,933) | $ (133,069) | $ (143,624) | $ (120,594) | $ (195,107) | $ 236,513 | $ 285,223 |
Earnings per Share (Details)
Earnings per Share (Details) $ / shares in Units, $ in Thousands | May 13, 2019 | Sep. 30, 2019USD ($)$ / sharesshares | Jun. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2019USD ($)$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares |
Earnings per Share | |||||||||||
Stock conversion ratio | 0.00757 | 0.00757 | 0.00757 | ||||||||
Potential common shares related to options under the employee incentive plan | 9,713,683 | 85,052,934 | 24,059,222 | 23,000,095 | 85,052,934 | 23,000,095 | 82,756,452 | 24,059,222 | |||
Potential common shares outstanding related to options under the employee incentive plan | 22,956,452 | 25,252,934 | 25,252,934 | 22,956,452 | 24,524,698 | 22,554,804 | |||||
Basic/Diluted EPS | |||||||||||
Net income (loss) | $ | $ 10,831 | $ (77,761) | $ (54,727) | $ (66,944) | $ (137,021) | $ (143,981) | $ (126,190) | $ (198,708) | $ (242,162) | $ (263,930) | |
Income available to common stockholders | $ | $ (242,162) | $ (263,930) | |||||||||
Basic Weighted-average number of common shares outstanding | 305,428,062 | 264,762,720 | 217,506,553 | 217,461,225 | 241,275,061 | 217,411,896 | 262,894,388 | 217,450,475 | 217,472,870 | 216,848,866 | |
Diluted Weighted-average number of common shares outstanding | 328,854,063 | 264,762,720 | 217,506,553 | 217,461,225 | 241,275,061 | 217,411,896 | 262,894,388 | 217,450,475 | 217,472,870 | 216,848,866 | |
Basic | $ / shares | $ 0.04 | $ (0.29) | $ (0.25) | $ (0.31) | $ (0.57) | $ (0.66) | $ (0.48) | $ (0.91) | $ (1.11) | $ (1.22) | |
Diluted | $ / shares | $ 0.03 | $ (0.29) | $ (0.25) | $ (0.31) | $ (0.57) | $ (0.66) | $ (0.48) | $ (0.91) | $ (1.11) | $ (1.22) |
Product and Geographic Sales _3
Product and Geographic Sales Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($)segment | Dec. 31, 2017USD ($) | |
Disaggregation of Revenue | ||||||||||
Number of operating segment | segment | 1 | |||||||||
Number of reportable segment | segment | 1 | |||||||||
Total revenues, gross | $ 243,065 | $ 242,440 | $ 243,422 | $ 244,210 | $ 476,629 | $ 482,704 | $ 719,694 | $ 726,126 | $ 971,620 | $ 967,307 |
Deferred revenues adjustment | (3,152) | (49,673) | ||||||||
Total Revenues, net | $ 242,998 | $ 242,309 | $ 242,897 | $ 243,297 | $ 476,334 | $ 480,324 | $ 719,332 | $ 723,221 | 968,468 | 917,634 |
Non-current assets other than financial instruments and deferred tax assets | 3,284,993 | 3,553,269 | ||||||||
Science Group | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 527,877 | 518,990 | ||||||||
Web of Science Product Line | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 361,957 | 352,995 | ||||||||
Cortellis Product Line | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 165,920 | 165,995 | ||||||||
Derwent Product Line | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 179,321 | 176,201 | ||||||||
MarkMonitor Product Line | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 122,947 | 120,408 | ||||||||
CompuMark Product Line | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 121,025 | 119,854 | ||||||||
Intellectual Property Group | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 423,293 | 416,463 | ||||||||
IP Management (IPM) Product Line | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 20,450 | 31,854 | ||||||||
North America | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 450,356 | 455,791 | ||||||||
Non-current assets other than financial instruments and deferred tax assets | 1,036,192 | 1,163,704 | ||||||||
Europe | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 242,415 | 243,245 | ||||||||
Non-current assets other than financial instruments and deferred tax assets | 2,145,073 | 2,294,998 | ||||||||
APAC | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 209,118 | 201,234 | ||||||||
Non-current assets other than financial instruments and deferred tax assets | 79,487 | 68,034 | ||||||||
Emerging Markets | ||||||||||
Disaggregation of Revenue | ||||||||||
Total revenues, gross | 69,731 | 67,037 | ||||||||
Non-current assets other than financial instruments and deferred tax assets | $ 24,241 | $ 26,533 | ||||||||
One Customer | Sales Revenue Net | Customer Concentration Risk | ||||||||||
Disaggregation of Revenue | ||||||||||
Concentration Risk, Percentage | 1.00% | 1.00% | ||||||||
Ten Customers | Sales Revenue Net | Customer Concentration Risk | ||||||||||
Disaggregation of Revenue | ||||||||||
Concentration Risk, Percentage | 6.00% | 7.00% |
Commitments and Contingencies -
Commitments and Contingencies - Contingencies (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2018 | Dec. 31, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2017 | Jun. 01, 2017 | |
Commitments and Contingencies | ||||||
Contingent purchase price paid | $ 2,470 | $ 2,470 | ||||
Write off of accumulated foreign currency impacts | 33,819 | |||||
Publons | ||||||
Commitments and Contingencies | ||||||
Additional payments to acquire business | 9,500 | $ 9,500 | $ 9,500 | $ 9,500 | ||
Contingent purchase price paid | 2,470 | |||||
Estimated fair value of contingent consideration | 2,960 | 4,445 | 3,429 | $ 5,900 | ||
Kopernio | ||||||
Commitments and Contingencies | ||||||
Additional payments to acquire business | 3,500 | |||||
TrademarkVision | ||||||
Commitments and Contingencies | ||||||
Estimated fair value of contingent consideration | 4,115 | 7,715 | 4,115 | |||
Accrued expenses and other current liabilities | Publons | ||||||
Commitments and Contingencies | ||||||
Estimated fair value of contingent consideration | 1,600 | 4,445 | 2,385 | 2,250 | ||
Other non-current liabilities | Publons | ||||||
Commitments and Contingencies | ||||||
Estimated fair value of contingent consideration | 1,360 | $ 0 | $ 1,044 | $ 3,650 | ||
Other non-current liabilities | TrademarkVision | ||||||
Commitments and Contingencies | ||||||
Estimated fair value of contingent consideration | $ 4,115 |
Commitments and Contingencies_2
Commitments and Contingencies - Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Leases | ||
Rental expense under operating leases | $ 25,527 | $ 17,255 |
Future aggregate minimum lease payments | ||
2019 | 22,140 | |
2020 | 19,531 | |
2021 | 17,240 | |
2022 | 15,333 | |
2023 | 14,944 | |
Thereafter | 40,367 | |
Total operating lease commitments | 129,555 | |
Restoration of the leased property | 4,100 | 4,200 |
Future minimum sublease payments to be received | 0 | |
Sublease income | $ 0 | $ 0 |
Commitments and Contingencies_3
Commitments and Contingencies - Unconditional Purchase Obligations (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Unconditional purchase obligations | |
Payments towards purchase obligations | $ 71,859 |
Future unconditional purchase obligations | |
2019 | 34,321 |
2020 | 24,370 |
2021 | 8,151 |
2022 | 13 |
Total | $ 66,855 |
Related Party and Former Pare_2
Related Party and Former Parent Transactions (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($)item | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)item | Jun. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Related Party and Former Parent Transactions | ||||||||||
Tax Receivable Agreement. | $ 264,600 | $ 264,600 | $ 264,600 | $ 264,600 | ||||||
Number Of Related Party In Key Management | item | 1 | 1 | ||||||||
Onex Partners Advisor LP | ||||||||||
Related Party and Former Parent Transactions | ||||||||||
Consulting fee in operating expenses | $ 30 | $ 158 | $ 208 | $ 208 | $ 389 | $ 416 | $ 419 | $ 624 | $ 920 | $ 1,230 |
Interest per annum (as a percent) | 0.10% | 0.10% | 0.10% | 0.10% | 0.10% | |||||
Interest expense | $ 0 | $ 112 | 223 | 226 | $ 327 | 452 | $ 327 | 675 | $ 905 | 1,557 |
Outstanding liability | 30 | 51 | 51 | 30 | 450 | 162 | ||||
Management Fee Expense | 5,400 | 5,400 | 5,400 | |||||||
Baring | ||||||||||
Related Party and Former Parent Transactions | ||||||||||
Consulting fee in operating expenses | 0 | 79 | 167 | 167 | 246 | 334 | 246 | 501 | 669 | 854 |
Outstanding liability | 0 | 79 | 79 | 0 | 334 | 641 | ||||
Management Fee Expense | 2,100 | 2,100 | 2,100 | |||||||
Controlled affiliate of Baring | ||||||||||
Related Party and Former Parent Transactions | ||||||||||
Outstanding liability | 166 | 145 | 145 | 166 | 120 | 199 | ||||
Payments to related party | 126 | 78 | $ 59 | $ 59 | 318 | $ 288 | 444 | $ 288 | 531 | 388 |
Member of key management | ||||||||||
Related Party and Former Parent Transactions | ||||||||||
Outstanding liability | 0 | 0 | 0 | 0 | 332 | |||||
Payments to related party | 0 | $ 200 | $ 278 | 278 | $ 865 | |||||
Chief Executive Officer [Member] | ||||||||||
Related Party and Former Parent Transactions | ||||||||||
Outstanding liability | 0 | 0 | ||||||||
Payments to related party | $ 481 | $ 481 | ||||||||
Publons | ||||||||||
Related Party and Former Parent Transactions | ||||||||||
Payments to related party | $ 716 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | Nov. 03, 2019 | Oct. 31, 2019 | Jan. 31, 2019 | Jan. 14, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2019 | Feb. 26, 2019 | Dec. 31, 2017 |
Subsequent Events | |||||||||
Aggregate principal amount | $ 1,346,320 | $ 2,028,993 | $ 1,342,484 | $ 2,060,700 | |||||
Fees and expenses associated with the refinancing | 21,201 | 34,838 | 20,038 | $ 43,086 | |||||
Amount payable under the agreement | 1,373,945 | 1,950,318 | $ 1,368,718 | ||||||
Expected loss from Sales and Purchase Agreement | 39,104 | ||||||||
2019 Revolving Credit Facility | |||||||||
Subsequent Events | |||||||||
Outstanding credit facility | $ 45,000 | ||||||||
Subsequent Event | |||||||||
Subsequent Events | |||||||||
Cash on hand | $ 12,000 | ||||||||
U.S. state and local taxes at a rate (as a percent) | 7.00% | ||||||||
Threshold payments to be made for deferral under tax receivable agreement | $ 30,000 | ||||||||
Subsequent Event | Forecast | MarkMonitor Business | Discontinued Operations, Held-for-sale | |||||||||
Subsequent Events | |||||||||
Consideration | $ 5,000 | ||||||||
Subsequent Event | Forecast | MarkMonitor Business | Discontinued Operations, Held-for-sale | Minimum | |||||||||
Subsequent Events | |||||||||
Expected loss from Sales and Purchase Agreement | 5,000 | ||||||||
Subsequent Event | Forecast | MarkMonitor Business | Discontinued Operations, Held-for-sale | Maximum | |||||||||
Subsequent Events | |||||||||
Expected loss from Sales and Purchase Agreement | $ 15,000 | ||||||||
Subsequent Event | 2019 Revolving Credit Facility | |||||||||
Subsequent Events | |||||||||
Interest rate spread (as a percentage) | 35.00% | ||||||||
Maximum total first lien net leverage ratio | 7.25 | ||||||||
Miniimum total first lien net leverage ratio | 1 | ||||||||
Repayments of debt | $ 15,000 | $ 30,000 | |||||||
Subsequent Event | Tax Receivable Agreement | |||||||||
Subsequent Events | |||||||||
Amount payable under the agreement | $ 200,000 | ||||||||
Subsequent Event | Letter of credit | Maximum | |||||||||
Subsequent Events | |||||||||
Undrawn letters of credit | 20,000 | ||||||||
2026 Notes | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Aggregate principal amount | $ 700,000 | ||||||||
Effective Interest Rate | 4.50% | ||||||||
7.875% Senior Secured Notes | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Effective Interest Rate | 7.875% | ||||||||
Amount outstanding | $ 846,320 | ||||||||
Fees and expenses associated with the refinancing | 20,000 | ||||||||
Camelot Finance S.A | Subsequent Event | 2019 Revolving Credit Facility | |||||||||
Subsequent Events | |||||||||
Outstanding credit facility | 250,000 | ||||||||
Camelot Finance S.A | 2019 Term Loan Facility | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Aggregate principal amount | $ 900,000 | ||||||||
Camelot Finance S.A | 2019 Term Loan Facility | LIBOR | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Interest rate spread (as a percentage) | 3.25% | ||||||||
Camelot Holding Ltd [Member] | |||||||||
Subsequent Events | |||||||||
Ownership interest in existing entity | 100.00% | ||||||||
Camelot And Churchill [Member] | Subsequent Event | |||||||||
Subsequent Events | |||||||||
Ownership interest in combined entity | 73.80% |
Subsequent Events (unaudited) (
Subsequent Events (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 14, 2019 | May 13, 2019 | Jan. 31, 2019 | May 31, 2019 | Apr. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Oct. 03, 2016 |
Subsequent Event [Line Items] | ||||||||||||||
Aggregate stock consideration issued by the Company | 1,500,000 | |||||||||||||
Non-recurring stock compensation charge | $ 37,108 | $ 7,022 | $ 46,675 | $ 10,682 | $ 13,715 | $ 17,663 | ||||||||
Deferred financing fees | $ 21,201 | 21,201 | 20,038 | 34,838 | 43,086 | |||||||||
Original issues discount | 1,855 | 1,855 | 1,737 | $ 3,633 | $ 4,534 | |||||||||
Term Loan Facility | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Deferred financing fees | $ 64,888 | |||||||||||||
Repayments of debt | 630,000 | $ 630,000 | ||||||||||||
Subsequent Event | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Available cash increased | $ 682,087 | |||||||||||||
Aggregate amount of stock consideration issued by the Company | $ 3,052,500 | |||||||||||||
Aggregate stock consideration issued by the Company | 305,250,000 | |||||||||||||
Value of stock per share | $ 10 | |||||||||||||
Warrants excluded | 52,800,000 | |||||||||||||
Compensatory options issued to the Company's management | 24,806,793 | |||||||||||||
Ordinary shares excluded | 10,600,000 | |||||||||||||
Ownership interest in combined entity at the closing of Transactions | 71.00% | |||||||||||||
Non-recurring stock compensation charge | 25,013 | |||||||||||||
Initial liability | $ 264,600 | |||||||||||||
Percent of calculated tax savings | 85.00% | |||||||||||||
Total payments related to the TRA | $ 507,326 | |||||||||||||
Cash payment for TRA | $ 200,000 | |||||||||||||
Not approved ordinary shares by BoD | 17,250,000 | |||||||||||||
Not approved private placement warrants by Bod | 17,265,826 | |||||||||||||
Subsequent Event | Revolving Credit Facility | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Voluntary Prepayment made | 20,000 | |||||||||||||
Repayments of debt | $ 15,000 | 30,000 | ||||||||||||
Subsequent Event | Term Loan Facility | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Voluntary Prepayment made | $ 630,000 | |||||||||||||
Deferred financing fees | 7,718 | 7,718 | ||||||||||||
Original issues discount | $ 1,406 | $ 1,406 | ||||||||||||
Interest payments | $ 100,000 | $ 50,000 | ||||||||||||
Subsequent Event | Company owners | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Ownership interest in combined entity | 74.00% | |||||||||||||
Ownership interest in combined entity at the closing of Transactions | 71.00% | |||||||||||||
Subsequent Event | Churchill | ||||||||||||||
Subsequent Event [Line Items] | ||||||||||||||
Ownership interest in combined entity | 26.00% |