Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 13, 2019 | Jun. 29, 2018 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | DELUXE CORP | ||
Entity Central Index Key | 27,996 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Period Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Shell Company | false | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Public Float | $ 3,119,184,444 | ||
Common Stock, Shares Outstanding | 43,677,292 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 59,740 | $ 59,240 |
Trade accounts receivable, net of allowances for uncollectible accounts | 173,862 | 149,844 |
Inventories and supplies | 46,441 | 42,249 |
Funds held for customers | 100,982 | 86,192 |
Revenue in excess of billings | 30,458 | 16,379 |
Other current assets | 38,563 | 39,062 |
Total current assets | 450,046 | 392,966 |
Deferred income taxes | 2,886 | 1,428 |
Long-term investments | 43,773 | 42,607 |
Property, plant and equipment, net of accumulated depreciation | 90,342 | 84,638 |
Assets held for sale | 1,350 | 12,232 |
Intangibles, net of accumulated amortization | 359,965 | 384,266 |
Goodwill | 1,160,626 | 1,130,934 |
Other non-current assets | 196,108 | 159,756 |
Total assets | 2,305,096 | 2,208,827 |
Current liabilities: | ||
Accounts payable | 106,978 | 104,477 |
Accrued liabilities | 284,281 | 277,253 |
Long-term debt due within one year | 791 | 44,040 |
Total current liabilities | 392,050 | 425,770 |
Long-term debt | 911,073 | 665,260 |
Deferred income taxes | 46,680 | 50,543 |
Other non-current liabilities | 39,880 | 52,241 |
Commitments and contingencies (Notes 11, 15 and 16) | ||
Shareholders' equity: | ||
Common shares $1 par value (authorized: 500,000 shares; outstanding: December 31, 2018 - 44,647; December 31, 2017 - 47,953) | 44,647 | 47,953 |
Retained earnings | 927,345 | 1,004,657 |
Accumulated other comprehensive loss | (56,579) | (37,597) |
Total shareholders' equity | 915,413 | 1,015,013 |
Total liabilities and shareholders' equity | $ 2,305,096 | $ 2,208,827 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares shares in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Shareholders' equity: | ||
Common stock, par value (per share) | $ 1 | $ 1 |
Common stock, shares authorized | 500,000 | 500,000 |
Common stock, shares outstanding | 44,647 | 47,953 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Total revenue | $ 1,998,025 | $ 1,965,556 | $ 1,849,062 |
Total cost of revenue | (791,748) | (742,707) | (667,813) |
Gross profit | 1,206,277 | 1,222,849 | 1,181,249 |
Selling, general and administrative expense | (854,000) | (830,231) | (807,238) |
Restructuring and integration expense | (21,203) | (9,130) | (7,771) |
Asset impairment charges | (101,319) | (54,880) | 0 |
Operating income | 231,221 | 329,176 | 366,887 |
Loss on early debt extinguishment | 0 | 0 | (7,858) |
Interest expense | (27,112) | (21,359) | (22,302) |
Other income | 8,522 | 5,010 | 3,659 |
Income before income taxes | 212,631 | 312,827 | 340,386 |
Income tax provision | (63,001) | (82,672) | (111,004) |
Net income | $ 149,630 | $ 230,155 | $ 229,382 |
Basic earnings per share | $ 3.18 | $ 4.75 | $ 4.68 |
Diluted earnings per share | $ 3.16 | $ 4.72 | $ 4.65 |
Operating expenses [Member] | |||
Restructuring and integration expense | $ (19,737) | $ (8,562) | $ (7,124) |
Product [Member] | |||
Total revenue | 1,451,833 | 1,469,854 | 1,472,882 |
Total cost of revenue | (547,640) | (529,638) | (534,906) |
Service [Member] | |||
Total revenue | 546,192 | 495,702 | 376,180 |
Total cost of revenue | $ (244,108) | $ (213,069) | $ (132,907) |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 149,630 | $ 230,155 | $ 229,382 |
Postretirement benefit plans: | |||
Net actuarial (loss) gain arising during the year | (3,805) | 7,011 | 1,486 |
Less reclassification of amounts from other comprehensive (loss) income to net income: | |||
Amortization of prior service credit | (853) | (1,049) | (866) |
Amortization of net actuarial loss | 1,825 | 2,893 | 2,518 |
Postretirement benefit plans | (2,833) | 8,855 | 3,138 |
Unrealized holding losses on debt securities arising during the year | (1) | (109) | (99) |
Unrealized foreign currency translation adjustment | (9,281) | 4,028 | 1,793 |
Other comprehensive (loss) income | (12,115) | 12,774 | 4,832 |
Comprehensive income | 137,515 | 242,929 | 234,214 |
Postretirement benefit plans: | |||
Net actuarial (loss) gain arising during the year | 1,339 | (2,465) | (952) |
Less reclassification of amounts from other comprehensive (loss) income to net income: | |||
Amortization of prior service credit | 568 | 372 | 555 |
Amortization of net actuarial loss | (1,059) | (744) | (1,279) |
Postretirement benefit plans | 848 | (2,837) | (1,676) |
Unrealized holding losses on debt securities arising during the year | 0 | 38 | 35 |
Total net tax benefit (expense) included in other comprehensive (loss) income | $ 848 | $ (2,799) | $ (1,641) |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common shares par value [Member] | Additional paid-in capital [Member] | Retained earnings [Member] | Accumulated other comprehensive loss [Member] |
Balance at Dec. 31, 2015 | $ 745,069 | $ 49,019 | $ 0 | $ 751,253 | $ (55,203) |
Balance, shares at Dec. 31, 2015 | 49,019 | ||||
Net income | $ 229,382 | 229,382 | |||
Cash dividends | (58,720) | (58,720) | |||
Common shares issued | $ 17,785 | 641 | 17,144 | ||
Common shares issued, shares | 641 | ||||
Common shares repurchased | $ (55,224) | (901) | (15,203) | (39,120) | |
Common shares repurchased, shares | (901) | ||||
Other common shares retired | $ (13,640) | (213) | (13,427) | ||
Other common shares retired, shares | (213) | ||||
Employee share-based compensation | $ 11,486 | 11,486 | |||
Other comprehensive income (loss) | 4,832 | 4,832 | |||
Balance at Dec. 31, 2016 | $ 880,970 | 48,546 | 0 | 882,795 | (50,371) |
Balance, shares at Dec. 31, 2016 | 48,546 | ||||
Net income | $ 230,155 | 230,155 | |||
Cash dividends | (58,103) | (58,103) | |||
Common shares issued | $ 16,892 | 558 | 16,334 | ||
Common shares issued, shares | 558 | ||||
Common shares repurchased | $ (65,000) | (924) | (13,886) | (50,190) | |
Common shares repurchased, shares | (924) | ||||
Other common shares retired | $ (16,596) | (227) | (16,369) | ||
Other common shares retired, shares | (227) | ||||
Employee share-based compensation | $ 13,921 | 13,921 | |||
Other comprehensive income (loss) | 12,774 | 12,774 | |||
Balance at Dec. 31, 2017 | $ 1,015,013 | 47,953 | 0 | 1,004,657 | (37,597) |
Balance, shares at Dec. 31, 2017 | 47,953 | ||||
Net income | $ 149,630 | 149,630 | |||
Cash dividends | (56,743) | (56,743) | |||
Common shares issued | $ 18,922 | 525 | 18,397 | ||
Common shares issued, shares | 525 | ||||
Common shares repurchased | $ (200,000) | (3,584) | (14,384) | (182,032) | |
Common shares repurchased, shares | (3,584) | ||||
Other common shares retired | $ (17,856) | (247) | (17,609) | ||
Other common shares retired, shares | (247) | ||||
Employee share-based compensation | $ 13,596 | 13,596 | |||
Adoption of new accounting pronouncement (Accounting Standards Update No. 2014-09 [Member]) at Dec. 31, 2017 | 4,966 | 4,966 | |||
Adoption of new accounting pronouncement (Accounting Standards Update No. 2018-02 [Member]) at Dec. 31, 2017 | 0 | 6,867 | (6,867) | ||
Other comprehensive income (loss) | (12,115) | (12,115) | |||
Balance at Dec. 31, 2018 | $ 915,413 | $ 44,647 | $ 0 | $ 927,345 | $ (56,579) |
Balance, shares at Dec. 31, 2018 | 44,647 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parentheticals) - $ / shares | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of Stockholders' Equity [Abstract] | |||||||||||
Cash dividends per share | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 1.20 | $ 1.20 | $ 1.20 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Cash flows from operating activities: | ||||
Net income | $ 149,630 | $ 230,155 | $ 229,382 | |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Depreciation | 16,572 | 15,868 | 14,498 | |
Amortization of intangibles | 114,528 | 106,784 | 77,085 | |
Asset impairment charges | 101,319 | 54,880 | 0 | |
Amortization of prepaid product discounts | 22,941 | 19,969 | 20,185 | |
Deferred income taxes | (11,356) | (39,177) | 1,886 | |
Employee share-based compensation expense | 13,378 | 15,109 | 12,459 | |
Gain on sales of businesses and customer lists | (15,641) | (8,703) | 0 | |
Loss on early debt extinguishment | 0 | 0 | 7,858 | |
Other non-cash items, net | 8,030 | 7,708 | 7,267 | |
Changes in assets and liabilities, net of effect of acquisitions: | ||||
Trade accounts receivable | (16,795) | 5,279 | (23,414) | |
Inventories and supplies | (3,641) | (644) | 2,244 | |
Other current assets | (12,032) | (7,976) | 49 | |
Non-current assets | (6,913) | (5,710) | (5,054) | |
Accounts payable | 4,366 | (7,796) | 15,888 | |
Prepaid product discount payments | (23,814) | (27,079) | (23,068) | |
Other accrued and non-current liabilities | (1,257) | (20,236) | (17,953) | |
Net cash provided by operating activities | 339,315 | 338,431 | 319,312 | |
Cash flows from investing activities: | ||||
Purchases of capital assets | (62,238) | (47,450) | (46,614) | |
Payments for acquisitions, net of cash acquired | [1] | (214,258) | (139,223) | (239,664) |
Proceeds from company-owned life insurance policies | 0 | 1,293 | 4,123 | |
Purchases of customer funds marketable securities | (7,807) | (7,737) | (7,869) | |
Proceeds from customer funds and corporate marketable securities | 7,807 | 11,237 | 9,504 | |
Other | 1,082 | 989 | 1,009 | |
Net cash used by investing activities | (275,414) | (180,891) | (279,511) | |
Cash flows from financing activities: | ||||
Proceeds from issuing long-term debt | 1,280,000 | 403,000 | 559,000 | |
Payments on long-term debt, including costs of debt reacquisition | (1,078,853) | (454,165) | (442,189) | |
Net change in customer funds obligations | 20,279 | (6,007) | 1,723 | |
Proceeds from issuing shares under employee plans | 7,523 | 9,033 | 9,114 | |
Employee taxes paid for shares withheld | (7,977) | (9,377) | (5,589) | |
Payments for common shares repurchased | (200,000) | (65,000) | (55,224) | |
Cash dividends paid to shareholders | (56,669) | (58,098) | (58,720) | |
Other | (4,128) | (2,342) | (2,117) | |
Net cash (used) provided by financing activities | (39,825) | (182,956) | 5,998 | |
Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents | (7,636) | 5,370 | 2,363 | |
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | 16,440 | (20,046) | 48,162 | |
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year | 128,819 | 148,865 | 100,703 | |
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) | $ 145,259 | $ 128,819 | $ 148,865 | |
[1] | ) Cash and cash equivalents acquired were $1,645 during 2018 , $27,299 during 2017 and $146 during 2016 |
Significant accounting policies
Significant accounting policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant accounting policies | Significant accounting policies Nature of operations – We provide a selection of customer life cycle management solutions that help our customers acquire and engage their customers across multiple channels. We offer a wide range of services and products to small businesses, including hosting and domain name services, logo and web design, search engine marketing and optimization, email marketing, payroll services, and business incorporation and organization services, in addition to our checks, forms and promotional product offerings. For financial institutions, we offer our check program solutions, as well as a selection of financial technology solutions, including data-driven marketing, including outsourced marketing campaign targeting and execution; treasury management solutions, including accounts receivable processing and remote deposit capture; and digital engagement solutions, including loyalty and rewards programs. We are also a leading printer of checks and accessories sold directly to consumers. Consolidation – The consolidated financial statements include the accounts of Deluxe Corporation and its wholly-owned subsidiaries. All intercompany accounts, transactions and profits have been eliminated. Comparability – Amounts within the consolidated balance sheet as of December 31, 2017 have been modified to conform to the current year presentation. Revenue in excess of billings is now presented separately. Previously, this amount was included in other current assets. Additionally, amounts within the cash flows from operating activities section of the consolidated statement of cash flows for the year ended December 31, 2017 have been modified to conform to the current year presentation. Gain on sales of businesses and customer lists is now presented separately. In the previous year, this amount was included within other non-cash items, net. The consolidated statements of income for 2017 and 2016 have been revised to reflect the adoption of Accounting Standards Update (ASU) No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . The consolidated statements of cash flows for 2017 and 2016 have been revised to reflect the adoption of ASU No. 2016-18, Restricted Cash . Further information regarding these standards can be found in Note 2. Use of estimates – We have prepared the accompanying consolidated financial statements in conformity with generally accepted accounting principles (GAAP) in the United States. In this process, it is necessary for us to make certain assumptions and estimates affecting the amounts reported in the consolidated financial statements and related notes. These estimates and assumptions are developed based upon all available information. However, actual results can differ from assumed and estimated amounts. Foreign currency translation – The financial statements of our foreign subsidiaries are measured in the respective subsidiaries' functional currencies, primarily Canadian and Australian dollars, and are translated into United States dollars. Assets and liabilities are translated using the exchange rates in effect at the balance sheet date. Revenue and expenses are translated at the average exchange rates during the year. The resulting translation gains and losses are reflected in accumulated other comprehensive loss in the shareholders' equity section of the consolidated balance sheets. Foreign currency transaction gains and losses are recorded in other income in the consolidated statements of income. Cash and cash equivalents – We consider all cash on hand and other highly liquid investments with original maturities of 3 months or less to be cash and cash equivalents. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents approximate fair value. Checks issued by us but not presented to the banks for payment may create negative book cash balances. These book overdrafts are included in accounts payable on the consolidated balance sheets and totaled $1,270 as of December 31, 2018 and $5,665 as of December 31, 2017 . Trade accounts receivable – Trade accounts receivable are initially recorded at the invoiced amount upon the sale of goods or services to customers, and they do not bear interest. They are stated net of allowances for uncollectible accounts, which represent estimated losses resulting from the inability of customers to make the required payments. When determining the allowances for uncollectible accounts, we take several factors into consideration, including the overall composition of accounts receivable aging, our prior history of accounts receivable write-offs, the type of customer and our day-to-day knowledge of specific customers. Changes in the allowances for uncollectible accounts are included in selling, general and administrative (SG&A) expense in our consolidated statements of income. The point at which uncollected accounts are written off varies by type of customer, but generally does not exceed 1 year from the due date of the receivable. Inventories and supplies – Inventories are stated at the lower of cost or net realizable value. Cost is calculated on the first-in, first-out basis. Supplies consist of items not used directly in the production of goods, such as maintenance and other supplies utilized in the production area. Funds held for customers – Our payroll services businesses collect funds from clients to pay their payroll and related taxes. We hold these funds temporarily until payments are remitted to the clients' employees and the appropriate taxing authorities. The customer contracts for our domestic payroll processing business include legal restrictions regarding the use of these funds. In addition, our treasury management cash receipt processing business remits a portion of cash receipts to our clients the business day following receipt. All of these funds, consisting of cash and available-for-sale debt securities, are reported as funds held for customers in the consolidated balance sheets. The corresponding liability for these obligations is included in accrued liabilities in the consolidated balance sheets. The available-for-sale debt securities are carried at fair value, with unrealized gains and losses included in accumulated other comprehensive loss in the consolidated balance sheets. Realized gains and losses are included in revenue in our consolidated statements of income and were not significant during the past 3 years. Long-term investments – Long-term investments consist primarily of cash surrender values of company-owned life insurance policies. Certain of these policies fund amounts due under our deferred compensation plan and our inactive supplemental executive retirement plan. Further information regarding these plans can be found in Notes 13 and 14. Property, plant and equipment – Property, plant and equipment, including leasehold and other improvements that extend an asset's useful life or productive capabilities, are stated at historical cost less accumulated depreciation. Buildings have been assigned useful lives of 40 years and machinery and equipment are generally assigned useful lives ranging from 1 year to 11 years, with a weighted-average useful life of 7 years as of December 31, 2018 . Buildings are depreciated using the 150% declining balance method, and machinery and equipment is depreciated using the sum-of-the-years' digits method. Leasehold and building improvements are depreciated on the straight-line basis over the estimated useful life of the property or the life of the lease, whichever is shorter. Maintenance and repairs are expensed as incurred. Fully depreciated assets are retained in property, plant and equipment until disposal. Any gains or losses resulting from the disposition of property, plant and equipment are included in SG&A expense in the consolidated statements of income, with the exception of building sales. Such gains and losses are reported separately in the consolidated statements of income, if significant. Assets held for sale – We record assets held for sale at the lower of their carrying value or fair value less costs to sell. Assets are classified as held for sale in our consolidated balance sheets when all of the following conditions are met: (1) management has the authority and commits to a plan to sell the assets; (2) the assets are available for immediate sale in their present condition; (3) there is an active program to locate a buyer and the plan to sell the assets has been initiated; (4) the sale of the assets is probable within one year; (5) the assets are being actively marketed at a reasonable sales price relative to their current fair value; and (6) it is unlikely that the plan to sell will be withdrawn or that significant changes to the plan will be made. Information regarding assets held for sale can be found in Note 3. Intangibles – Intangible assets are stated at historical cost less accumulated amortization. Amortization expense is generally determined on the straight-line basis, with the exception of customer lists, which are generally amortized using accelerated methods that reflect the pattern in which we receive the economic benefit of the asset. Intangibles have been assigned useful lives ranging from 1 year to 14 years, with a weighted-average useful life of 6 years as of December 31, 2018 . Each reporting period, we evaluate the remaining useful lives of our amortizable intangibles to determine whether events or circumstances warrant a revision to the remaining period of amortization. If our estimate of an asset's remaining useful life is revised, the remaining carrying amount of the asset is amortized prospectively over the revised remaining useful life. As of December 31, 2017 , we held a trade name asset that was assigned an indefinite useful life. As such, this asset was not amortized, but was subject to impairment testing on at least an annual basis. During 2018, we determined that this asset was fully impaired. Further information regarding the resulting asset impairment charge can be found in Note 8. Any gains or losses resulting from the disposition of intangibles are included in SG&A expense in the consolidated statements of income. We capitalize costs of software developed or obtained for internal use, including website development costs, once the preliminary project stage has been completed, management commits to funding the project and it is probable that the project will be completed and the software will be used to perform the function intended. Capitalized costs include only (1) external direct costs of materials and services consumed in developing or obtaining internal-use software, (2) payroll and payroll-related costs for employees who are directly associated with and who devote time to the internal-use software project, and (3) interest costs incurred, when significant, while developing internal-use software. Costs incurred in populating websites with information about the company or products are expensed as incurred. Capitalization of costs ceases when the project is substantially complete and ready for its intended use. The carrying value of internal-use software is reviewed in accordance with our policy on impairment of long-lived assets and amortizable intangibles. We incur costs in connection with the development of certain software products that we sell to our customers. Costs for the development of software products to be sold are expensed as incurred until technological feasibility is established, at which time, such costs are capitalized until the product is available for general release to customers. Impairment of long-lived assets and amortizable intangibles – We evaluate the recoverability of property, plant, equipment and amortizable intangibles not held for sale whenever events or changes in circumstances indicate that an asset group's carrying amount may not be recoverable. Such circumstances could include, but are not limited to, (1) a significant decrease in the market value of an asset, (2) a significant adverse change in the extent or manner in which an asset is used or in its physical condition, or (3) an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of an asset. We compare the carrying amount of the asset group to the estimated undiscounted future cash flows associated with it. If the sum of the expected future net cash flows is less than the carrying value of the asset group being evaluated, an impairment loss would be recognized. The impairment loss would be calculated as the amount by which the carrying value of the asset group exceeds the fair value of the asset group. As quoted market prices are not available for the majority of our assets, the estimate of fair value is based on various valuation techniques, including the discounted value of estimated future cash flows. During 2018 and 2017, we recorded asset impairment charges related to certain intangible assets. Further information regarding these impairment charges can be found in Note 8. We evaluate the recoverability of property, plant, equipment and intangibles held for sale by comparing the asset's carrying amount with its estimated fair value less costs to sell. Should the estimated fair value less costs to sell be less than the carrying value of the long-lived asset, an impairment loss would be recognized. The impairment loss would be calculated as the amount by which the carrying value of the asset exceeds the estimated fair value of the asset less costs to sell. During 2017, we recorded asset impairment charges related to Small Business Services assets held for sale. Further information regarding the impairment charges can be found in Note 8. The evaluation of asset impairment requires us to make assumptions about future cash flows over the life of the asset group being evaluated. These assumptions require significant judgment and actual results may differ from assumed and estimated amounts. Impairment of indefinite-lived intangibles and goodwill – We evaluate the carrying value of indefinite-lived intangibles and goodwill on July 31 st of each year and between annual evaluations if events occur or circumstances change that would indicate a possible impairment. Such circumstances could include, but are not limited to, (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, (3) an adverse change in market conditions that are indicative of a decline in the fair value of the assets, (4) a change in our business strategy, or (5) an adverse action or assessment by a regulator. Information regarding the results of our impairment analyses can be found in Note 8. In completing the annual impairment analysis of our indefinite-lived trade name in each of the past 3 years, we elected to perform a quantitative assessment. This assessment compared the carrying amount of the asset to its estimated fair value. The estimate of fair value was based on the relief from royalty method, which calculates the cost savings associated with owning rather than licensing the trade name. An assumed royalty rate was applied to forecasted revenue and the resulting cash flows were discounted. If the estimated fair value is less than the carrying value of the asset, an impairment loss is recognized for the difference. During 2018, our analysis indicated that this asset was fully impaired. Further information regarding this impairment can be found in Note 8. To analyze goodwill for impairment, we must assign our goodwill to individual reporting units. Identification of reporting units includes an analysis of the components that comprise each of our operating segments, which considers, among other things, the manner in which we operate our business and the availability of discrete financial information. Components of an operating segment are aggregated to form 1 reporting unit if the components have similar economic characteristics. We periodically review our reporting units to ensure that they continue to reflect the manner in which we operate our business. When completing our annual goodwill impairment analysis, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after this qualitative assessment, we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative impairment test is unnecessary. When performing a quantitative analysis of goodwill, we calculate the estimated fair value of the reporting unit and compare this amount to the carrying amount of the reporting unit's net assets. In calculating the estimated fair value of a business unit, we use the income approach. This approach is a valuation technique under which we estimate future cash flows using the reporting unit's financial forecast from the perspective of an unrelated market participant. Using historical trending and internal forecasting techniques, we project revenue and apply our fixed and variable cost experience rates to the projected revenue to arrive at the future cash flows. A terminal value is then applied to the projected cash flow stream. Future estimated cash flows are discounted to their present value to calculate the estimated fair value. Our discount rate is the market-value-weighted average of our estimated cost of capital derived using both known and estimated customary market metrics. In determining the estimated fair values of our reporting units, we are required to estimate a number of factors, including projected operating results, terminal growth rates, economic conditions, anticipated future cash flows, the discount rate and the allocation of shared or corporate items. When completing a quantitative analysis for all of our reporting units, the summation of our reporting units' fair values is compared to our consolidated fair value, as indicated by our market capitalization, to evaluate the reasonableness of our calculations. If the carrying amount of a reporting unit's net assets exceeds its estimated fair value, an impairment loss is recorded for the difference, not to exceed the carrying amount of goodwill. Prepaid product discounts – Certain of our financial institution contracts require prepaid product discounts in the form of upfront cash payments or accruals for amounts owed to financial institution clients of our Financial Services segment. These prepaid product discounts are included in other non-current assets in our consolidated balance sheets and are generally amortized as reductions of revenue on the straight-line basis over the contract term. Currently, these amounts are being amortized over periods ranging from 1 year to 10 years, with a weighted-average life of 6 years as of December 31, 2018 . Whenever events or changes occur that impact the related contract, including significant declines in the anticipated profitability, we evaluate the carrying value of prepaid product discounts to determine if they are impaired. Should a financial institution cancel a contract prior to the agreement's termination date, or should the volume of orders realized through a financial institution fall below contractually-specified minimums, we generally have a contractual right to a refund of the remaining unamortized prepaid product discount. Advertising costs – Deferred advertising costs include materials, printing, labor and postage costs related to direct response advertising programs of our Direct Checks and Small Business Services segments. These costs are amortized as SG&A expense over periods (not exceeding 18 months) that correspond to the estimated revenue streams of the individual advertisements. The actual revenue streams are analyzed at least annually to monitor the propriety of the amortization periods. Judgment is required in estimating the future revenue streams, especially with regard to check re-orders, which can span an extended period of time. Significant changes in the actual revenue streams would require the amortization periods to be modified, thus impacting our results of operations during the period in which the change occurred and in subsequent periods. Within our Direct Checks segment, approximately 88% of the costs of individual advertisements is expensed within 6 months of the advertisement. The deferred advertising costs of our Small Business Services segment are fully amortized within 6 months of the advertisement. Deferred advertising costs are included in other current assets and other non-current assets in the consolidated balance sheets. Non-direct response advertising projects are expensed as incurred. Catalogs provided to financial institution clients of our Financial Services segment are accounted for as prepaid assets until they are shipped to financial institutions. The total amount of advertising expense, including direct response and non-direct response advertising, was $74,549 in 2018 , $78,722 in 2017 and $85,141 in 2016 . Loans and notes receivable from distributors – We have, at times, provided loans to certain of our Safeguard ® distributors to allow them to purchase the operations of other small business distributors. We have also sold distributors and customer lists that we own in exchange for notes receivable. These loans and notes receivable are included in other current assets and other non-current assets in the consolidated balance sheets. Interest is accrued at market interest rates as earned. We continually monitor the credit quality and associated risks of these receivable on an individual basis based on criteria such as the financial stability of the distributor, historical commissions earned and their reported financial results. We generally withhold commissions payable to the distributors to settle the monthly payments due on the receivables, thus, somewhat mitigating the risk that the receivables will not be collected. As of December 31, 2018 and December 31, 2017 , past due amounts, allowances for credit losses and receivables placed on non-accrual status were not significant. The determination to place receivables on non-accrual status or to resume the accrual of interest is completed on a case-by-case basis, evaluating the specifics of each situation. Restructuring and integration expense – Over the past several years, we have recorded restructuring and integration expense as a result of various cost management efforts, including facility closings and the relocation of business activities, as well as fundamental changes in the manner in which certain business functions are conducted, including the integration of acquired businesses and the consolidation of redundant information technology systems. These expenses have consisted of costs which are expensed when incurred, such as information technology costs, employee and equipment moves, training and travel, as well as accruals for employee termination benefits payable under our ongoing severance benefit plan. We record accruals for employee termination benefits when it is probable that a liability has been incurred and the amount of the liability is reasonably estimable. We are required to make estimates and assumptions in calculating the restructuring accruals as, on some occasions, employees choose to voluntarily leave the company prior to their termination date or they secure another position within the company. In these situations, the employees do not receive termination benefits. To the extent our assumptions and estimates differ from our actual costs, subsequent adjustments to restructuring and integration accruals have been and will be required. Restructuring and integration accruals are included in accrued liabilities and other non-current liabilities in our consolidated balance sheets. Litigation – We are party to legal actions and claims arising in the ordinary course of business. We record accruals for legal matters when the expected outcome of these matters is either known or considered probable and can be reasonably estimated. Our accruals do not include related legal and other costs expected to be incurred in defense of legal actions. Further information regarding litigation can be found in Note 16. Income taxes – Deferred income taxes result from temporary differences between the financial reporting basis of assets and liabilities and their respective tax reporting basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences reverse. Net deferred tax assets are recognized to the extent that realization of such benefits is more likely than not. We are subject to tax audits in numerous domestic and foreign tax jurisdictions. Tax audits are often complex and can require several years to complete. In the normal course of business, we are subject to challenges from the Internal Revenue Service and other tax authorities regarding the amount of taxes due. These challenges may alter the timing or amount of taxable income or deductions, or the allocation of income among tax jurisdictions. We recognize the benefits of tax return positions in the financial statements when they are more-likely-than-not to be sustained by the taxing authorities based solely on the technical merits of the position. If the recognition threshold is met, the tax benefit is measured and recognized as the largest amount of tax benefit that, in our judgment, is greater than 50% likely to be realized. Accrued interest and penalties related to unrecognized tax positions are included in our provision for income taxes in the consolidated statements of income. Derivative financial instruments – Information regarding our derivative financial instruments is included in Note 7. We did not have any derivative instruments outstanding as of December 31, 2018 or December 31, 2017, as we settled all of our interest rate swaps during 2016. We do not use derivative financial instruments for speculative or trading purposes. Our policy is that all derivative transactions must be linked to an existing balance sheet item or firm commitment, and the notional amount cannot exceed the value of the exposure being hedged. We recognize all derivative financial instruments in the consolidated financial statements at fair value regardless of the purpose or intent for holding the instrument. Changes in the fair value of derivative financial instruments are recognized periodically either in income or in shareholders' equity as a component of accumulated other comprehensive loss, depending on whether the derivative financial instrument qualifies for hedge accounting, and if so, whether it qualifies as a fair value hedge or a cash flow hedge and whether the hedge is effective. Generally, changes in fair values of derivatives accounted for as fair value hedges are recorded in income along with the portion of the change in the fair value of the hedged items that relate to the hedged risk. Changes in fair values of derivatives accounted for as cash flow hedges, to the extent they are effective as hedges, are recorded in accumulated other comprehensive loss, net of tax. We classify the cash flows from derivative instruments that have been designated as fair value or cash flow hedges in the same category as the cash flows from the items being hedged. Changes in fair values of derivatives not qualifying as hedges and the ineffective portion of hedges are reported in income. Revenue recognition – On January 1, 2018, we adopted ASU No. 2014-09, Revenue from Contracts with Customers, along with subsequent amendments to this standard. We applied the new standards using the modified retrospective approach under which the cumulative effect of initially applying the standards was recorded as an adjustment to retained earnings as of the date of adoption. As such, prior periods have not been revised and continue to be reported under the accounting standards in effect for those periods. Further information regarding the adoption of this standard can be found in Note 2. Beginning in 2018, our product revenue is recognized when control of the goods is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods. In most cases, control is transferred when products are shipped. We recognize the vast majority of our service revenue as the services are provided. The majority of our contracts are for the shipment of tangible products or the delivery of services that have a single performance obligation or include multiple performance obligations where control is transferred at the same time. During previous years, revenue was recognized when (1) persuasive evidence of an arrangement existed, (2) delivery occurred or services were rendered, (3) the sales price was fixed or determinable, and (4) collectibility was reasonably assured. Our product revenue was recognized upon shipment or customer receipt, based upon the transfer of title, and we recognized the majority of our service revenue as the services were provided. In all periods, revenue is presented in the consolidated statements of income net of rebates, discounts, amortization of prepaid product discounts, and sales tax collected concurrent with revenue-producing activities. Many of our check supply contracts with financial institutions provide for rebates on certain products. We record these rebates as reductions of revenue and as accrued liabilities on our consolidated balance sheets when the related revenue is recognized. Amounts billed to customers for shipping and handling are included in revenue, while the related shipping and handling costs are reflected in cost of products and are accrued when the related revenue is recognized. When another party is involved in providing goods or services to a customer, we must determine whether our obligation is to provide the specified good or service itself (i.e., we are the principal in the transaction) or to arrange for that good or service to be provided by the other party (i.e., we are an agent in the transaction). When we are responsible for satisfying a performance obligation, based on our ability to control the product or service provided, we are considered the principal and revenue is recognized for the gross amount of consideration. When the other party is primarily responsible for satisfying a performance obligation, we are considered the agent and revenue is recognized in the amount of any fee or commission to which we are entitled. In the case of our Financial Services rewards, incentive and loyalty programs, we receive payments from consumers or our clients for the products and services provided, including hotel stays, gift cards and merchandise. We have determined that we are an agent in these transactions and this revenue is recorded net of the related fulfillment costs. Within our Small Business Services segment, we sell certain products and services through a network of Safeguard distributors. We have determined that we are the principal in these transactions and revenue is recorded for the gross amount of consideration. Certain of our contracts for data-driven marketing solutions and treasury management outsourcing services within Financial Services have variable consideration that is contingent on either the success of the marketing campaign ("pay-for-performance") or the volume of outsourcing services provided. We recognize revenue for estimated variable consideration as services are provided based on the most likely amount to be realized. Revenue is recognized to the extent that it is probable that a significant reversal of revenue will not occur when the contingency is resolved. Estimates regarding the recognition of variable consideration are updated each quarter. Typically, the amount of consideration for these contracts is finalized within 4 months, although pricing under certain of our outsourcing contracts may be based on annual volume commitments. Revenue recognized from these contracts was approximately $130,000 in 2018. Upon adoption of ASU No. 2014-09, we accelerated the recognition of a portion of this variable consideration. Our payment terms vary by type of customer and the products or services offered. The time period between invoicing and when payment is due is not significant. For certain products, services and customer types, we require payment before the products or services are delivered to the cu |
New accounting pronouncements
New accounting pronouncements | 12 Months Ended |
Dec. 31, 2018 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New accounting pronouncements | New accounting pronouncements The following discusses the impact of each accounting standard adopted on January 1, 2018: ASU No. 2014-09 – In May 2014, the Financial Accounting Standards Board (FASB) issued ASU No. 2014-09, Revenue from Contracts with Customers . This standard provides revenue recognition guidance for any entity that enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of non-financial assets, unless those contracts are within the scope of other accounting standards. In addition, the FASB subsequently issued several amendments to the standard. We adopted this standard and all the related amendments on January 1, 2018 using the modified retrospective method. We applied the new guidance to uncompleted contracts as of January 1, 2018 and recorded the cumulative effect of initially applying the standard as an adjustment to retained earnings as of the date of adoption, with the offset to revenue in excess of billings, other non-current assets and deferred income tax liabilities. We elected the following practical expedients allowed under the guidance: • We considered the impact of all contract modifications completed prior to January 1, 2018; • We disregard the effects of a financing component when the period between payment and performance is 1 year or less; • We account for shipping and handling activities that occur after the customer has obtained control of a good as a fulfillment cost; and • We expense sales commissions as incurred when the amortization period would have been 1 year or less. Election of these practical expedients did not have a significant impact on our results of operations or financial position. Prior period financial information has not been revised and continues to be reported under the accounting standards in effect for those periods. Adoption of this guidance did not have a significant impact on our results of operations, financial position or cash flows during the year ended December 31, 2018, and we do not expect it to have a significant impact on an ongoing basis. The new guidance also expands the required financial statement disclosures regarding revenue. Our revenue recognition accounting policy can be found in Note 1 and disaggregated revenue information can be found in Note 18. The cumulative effect of adoption of the new revenue guidance on our consolidated balance sheet as of January 1, 2018 was as follows: (in thousands) Balance as of December 31, 2017 Adjustments due to adoption of ASU No. 2014-09 Balance as of January 1, 2018 Revenue in excess of billings $ 16,379 $ 960 $ 17,339 Total current assets 392,966 960 393,926 Other non-current assets 159,756 5,733 165,489 Total assets $ 2,208,827 $ 6,693 $ 2,215,520 Deferred income taxes 50,543 1,727 52,270 Retained earnings 1,004,657 4,966 1,009,623 Total liabilities and shareholders' equity $ 2,208,827 $ 6,693 $ 2,215,520 The impact of the new revenue guidance on our consolidated statement of income for the year ended December 31, 2018 and on our consolidated balance sheet as of December 31, 2018 was as follows: (in thousands) As reported Effect of adoption Amounts without adoption of ASU No. 2014-09 Year Ended December 31, 2018 Service revenue $ 546,192 $ (717 ) $ 545,475 Total revenue 1,998,025 (717 ) 1,997,308 Cost of services (244,108 ) 625 (243,483 ) Total cost of revenue (791,748 ) 625 (791,123 ) Gross profit 1,206,277 (92 ) 1,206,185 Selling, general and administrative expense (854,000 ) (749 ) (854,749 ) Operating income 231,221 (841 ) 230,380 Income before income taxes 212,631 (841 ) 211,790 Income tax provision (63,001 ) 209 (62,792 ) Net income $ 149,630 $ (632 ) $ 148,998 December 31, 2018 Revenue in excess of billings $ 30,458 $ (1,052 ) $ 29,406 Total current assets 450,046 (1,052 ) 448,994 Other non-current assets 196,108 (6,482 ) 189,626 Total assets $ 2,305,096 $ (7,534 ) $ 2,297,562 Accrued liabilities $ 284,281 $ (209 ) $ 284,072 Total current liabilities 392,050 (209 ) 391,841 Deferred income taxes 46,680 (1,727 ) 44,953 Retained earnings 927,345 (5,598 ) 921,747 Total liabilities and shareholders' equity $ 2,305,096 $ (7,534 ) $ 2,297,562 ASU No. 2016-01 – In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities . This standard is intended to improve the recognition, measurement, presentation and disclosure of financial instruments. We adopted this standard on January 1, 2018. This standard had no impact on our results of operations or financial position. Our financial statement disclosures in Note 8 related to financial instruments have been modified to comply with the new standard. ASU No. 2016-16 – In October 2016, the FASB issued ASU No. 2016-16, Intra-Entity Transfers of Assets Other Than Inventory . This standard requires recognition of the tax effects resulting from the intercompany sale of an asset when the transfer occurs. Previously, the tax effects were deferred until the transferred asset was sold to a third party. We adopted this standard on January 1, 2018. No adjustment was required to opening retained earnings. Application of this standard has not had a significant impact on our results of operations or financial position and we do not expect it to have a significant impact on an ongoing basis. ASU No. 2016-18 – In November 2016, the FASB issued ASU No. 2016-18, Restricted Cash . This standard requires the statement of cash flows to explain the change during the period in the total of cash, cash equivalents, restricted cash and restricted cash equivalents. This standard was effective for us on January 1, 2018 and was required to be applied retrospectively. Accordingly, we have revised our consolidated statements of cash flows to include cash and cash equivalents included in funds held for customers with cash, cash equivalents, restricted cash and restricted cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statements of cash flows. Further information concerning adoption of this standard can be found in Summarized Quarterly Financial Data. The impact of this revision on our consolidated statements of cash flows for the years ended December 31, 2017 and December 31, 2016 was as follows: (in thousands) As previously reported Effect of adoption As revised Year Ended December 31, 2017 Purchases of customer funds marketable securities $ — $ (7,737 ) $ (7,737 ) Proceeds from customer funds and corporate marketable securities 3,500 7,737 11,237 Net cash used by investing activities (180,891 ) — (180,891 ) Net change in customer funds obligations — (6,007 ) (6,007 ) Net cash used by financing activities (176,949 ) (6,007 ) (182,956 ) Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents 2,075 3,295 5,370 Net change in cash, cash equivalents, restricted cash and restricted cash equivalents (17,334 ) (2,712 ) (20,046 ) Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year 76,574 72,291 148,865 Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) $ 59,240 $ 69,579 $ 128,819 Year Ended December 31, 2016 Payments for acquisitions, net of cash acquired $ (270,939 ) $ 31,275 $ (239,664 ) Purchases of customer funds marketable securities — (7,869 ) (7,869 ) Proceeds from customer funds and corporate marketable securities 1,635 7,869 9,504 Net cash used by investing activities (310,786 ) 31,275 (279,511 ) Net change in customer funds obligations — 1,723 1,723 Net cash provided by financing activities 4,275 1,723 5,998 Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents 1,346 1,017 2,363 Net change in cash, cash equivalents, restricted cash and restricted cash equivalents 14,147 34,015 48,162 Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year 62,427 38,276 100,703 Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) $ 76,574 $ 72,291 $ 148,865 ASU No. 2017-01 – In January 2017, the FASB issued ASU No. 2017-01, Clarifying the Definition of a Business . This standard revises the definition of a business, which affects many areas of accounting, such as business combinations and disposals and goodwill impairment. The revised definition of a business will likely result in more acquisitions being accounted for as asset acquisitions, as opposed to business combinations. We adopted this standard on January 1, 2018, applying the guidance to transactions occurring on or after this date. Adoption of the standard did not have a significant impact on our results of operations or financial position. ASU No. 2017-07 – In March 2017, the FASB issued ASU No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . This standard requires that the service cost component of net periodic benefit expense be recognized in the same statement of income caption(s) as other compensation costs, and requires that the other components of net periodic benefit expense be recognized in the non-operating section of the statement of income. In addition, only the service cost component of net periodic benefit expense is eligible for capitalization when applicable. We adopted this standard on January 1, 2018. The reclassification of the other components of our net periodic benefit income was applied on a retrospective basis. As such, we have revised our results of operations for previous periods. We utilized the practical expedient for adoption allowing us to use the amounts previously disclosed in our postretirement benefits footnote as the basis for revising prior periods. As there is no service cost associated with our plans, we reclassified the entire amount of our net periodic benefit income from cost of revenue and SG&A expense to other income in our consolidated statements of income. In addition, we no longer include any portion of net periodic benefit income in amounts capitalized for inventory or internal-use software, as only the service cost component is eligible for capitalization. This change did not have a significant impact on our results of operations or financial position. The impact of the revision on our consolidated statements of income for the years ended December 31, 2017 and December 31, 2016 was as follows: (in thousands) As previously reported Effect of adoption As revised Year Ended December 31, 2017 Cost of products $ (529,088 ) $ (550 ) $ (529,638 ) Cost of services (213,002 ) (67 ) (213,069 ) Total cost of revenue (742,090 ) (617 ) (742,707 ) Gross profit 1,223,466 (617 ) 1,222,849 Selling, general and administrative expense (828,832 ) (1,399 ) (830,231 ) Operating income 331,192 (2,016 ) 329,176 Other income 2,994 2,016 5,010 Net income $ 230,155 $ — $ 230,155 Year Ended December 31, 2016 Cost of products $ (534,390 ) $ (516 ) $ (534,906 ) Cost of services (132,851 ) (56 ) (132,907 ) Total cost of revenue (667,241 ) (572 ) (667,813 ) Gross profit 1,181,821 (572 ) 1,181,249 Selling, general and administrative expense (805,970 ) (1,268 ) (807,238 ) Operating income 368,727 (1,840 ) 366,887 Other income 1,819 1,840 3,659 Net income $ 229,382 $ — $ 229,382 ASU No. 2017-09 – In May 2017, the FASB issued ASU No. 2017-09, Scope of Modification Accounting . This standard provides guidance about which changes to the terms or conditions of a share-based payment award require modification accounting, which may result in a different fair value for the award. We adopted this standard on January 1, 2018, and it is being applied prospectively to awards modified on or after this date. Application of this standard did not have a significant impact on our results of operations or financial position and we do not expect it to have a significant impact on an ongoing basis. ASU No. 2018-02 – In February 2018, the FASB issued ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . This standard allows companies to make an election to reclassify from accumulated other comprehensive income to retained earnings the stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (the "2017 Tax Act"). We elected to early adopt this standard on January 1, 2018, applying it in the period of adoption. As such, we reclassified $6,867 from accumulated other comprehensive loss to retained earnings. This represents the effect of the change in the United States federal corporate income tax rate on the gross deferred tax amount at the date of enactment of the 2017 Tax Act related to items remaining in accumulated other comprehensive loss. ASU No. 2018-05 – In March 2018, the FASB issued ASU No. 2018-05, Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin (SAB) No. 118 . This standard added to the FASB Codification the guidance provided by the SEC in December 2017 regarding the accounting for the 2017 Tax Act. We complied with SAB No. 118 when preparing our annual consolidated financial statements for the year ended December 31, 2017. During 2017, reasonable estimates were used to determine certain impacts of the 2017 Tax Act, including our 2017 deferred income tax activity and the amount of post-1986 unremitted foreign earnings subject to the repatriation toll charge. We finalized our accounting for the 2017 Tax Act during the fourth quarter of 2018. Our income tax provision for the year ended December 31, 2018 was reduced $1,700 for adjustments to our accounting for the 2017 Tax Act, primarily a reduction in the amount accrued for the repatriation toll charge. Other accounting pronouncements adopted – In August 2018, the FASB issued ASU No. 2018-13, Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurements . This standard removes, modifies and adds certain disclosures related to recurring and nonrecurring fair value measurements. On September 30, 2018, we early adopted the provisions of the standard that remove and modify disclosure requirements. This adoption had minimal impact on our fair value disclosures in Note 8. The additional disclosures required under the new guidance are effective for us on January 1, 2020. In August 2018, the FASB issued ASU No. 2018-14, Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans . This standard modifies certain disclosures related to defined benefit pension and other postretirement plans and requires adoption on a retrospective basis to all periods presented. We early adopted this standard on December 31, 2018 and included the modified disclosures in Note 14. Accounting pronouncements not yet adopted – In February 2016, the FASB issued ASU No. 2016-02, Leasing . This standard is intended to increase transparency and comparability among organizations by requiring the recognition of lease assets and lease liabilities for virtually all leases and by requiring the disclosure of key information about leasing arrangements. In July 2018, the FASB issued two amendments to ASU No. 2016-02: ASU No. 2018-10, Codification Improvements to Topic 842, Leases , which amends narrow aspects of the guidance in ASU No. 2016-02, and ASU No. 2018-11, Targeted Improvements, which provides an optional transition method under which comparative periods presented in financial statements in the period of adoption would not be restated. All of these standards are effective for us on January 1, 2019. They are required to be adopted using a modified retrospective approach, and we plan to elect the optional transition method under ASU No. 2018-11. We established an implementation team to evaluate and identify the impact of these standards on our financial position, results of operations and cash flows. We are currently completing the assessment of our leasing arrangements and the implementation of software to meet the reporting requirements of the standard. We anticipate that we will elect the practical expedient package outlined in ASU No. 2016-02 under which we do not have to reassess whether an arrangement contains a lease, we can carryforward our previous classification of leases as either operating or capital leases, and we do not have to reassess previously recorded initial direct costs. Additionally, we anticipate that we will make the following policy elections: • We will exclude leases with original terms of 12 months or less from lease assets and liabilities; • We will separate nonlease components from the associated lease component for real estate leases; and • We will use the accounting lease term when determining the incremental borrowing rate for leases with renewal options. We estimate that we will recognize, as of January 1, 2019, lease assets and liabilities of at least $45,000 for leases classified as operating leases under previous guidance. We do not expect the new guidance to have a significant impact on our consolidated statements of income or on our consolidated statements of cash flows on an ongoing basis. In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments . This standard introduces new guidance for the accounting for credit losses on instruments within its scope, including trade and loans receivable and available-for-sale debt securities. In November 2018, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, Financial Instruments – Credit Losses, which clarifies that receivables arising from operating leases are not within the scope of ASU No. 2016-13. These standards are effective for us on January 1, 2020 and require adoption using a modified retrospective approach. We do not expect the application of these standards to have a significant impact on our results of operations or financial position. In August 2018, the FASB issued ASU No. 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract |
Supplemental balance sheet and
Supplemental balance sheet and cash flow information | 12 Months Ended |
Dec. 31, 2018 | |
Supplemental balance sheet and cash flow information [Abstract] | |
Supplemental balance sheet and cash flow information | Supplemental balance sheet and cash flow information Trade accounts receivable – Net trade accounts receivable was comprised of the following at December 31: (in thousands) 2018 2017 Trade accounts receivable – gross $ 177,501 $ 152,728 Allowances for uncollectible accounts (3,639 ) (2,884 ) Trade accounts receivable – net $ 173,862 $ 149,844 Changes in the allowances for uncollectible accounts for the years ended December 31 were as follows: (in thousands) 2018 2017 2016 Balance, beginning of year $ 2,884 $ 2,828 $ 4,816 Bad debt expense 3,622 3,208 2,539 Write-offs, net of recoveries (2,867 ) (3,152 ) (4,527 ) Balance, end of year $ 3,639 $ 2,884 $ 2,828 Inventories and supplies – Inventories and supplies were comprised of the following at December 31: (in thousands) 2018 2017 Raw materials $ 7,543 $ 7,357 Semi-finished goods 7,273 7,635 Finished goods 27,608 24,146 Supplies 4,017 3,111 Inventories and supplies $ 46,441 $ 42,249 Available-for-sale debt securities – Available-for-sale debt securities included within funds held for customers were comprised of the following: December 31, 2018 (in thousands) Cost Gross unrealized gains Gross unrealized losses Fair value Funds held for customers: (1) Domestic money market fund $ 16,000 $ — $ — $ 16,000 Canadian and provincial government securities 8,485 — (355 ) 8,130 Canadian guaranteed investment certificates 7,333 — — 7,333 Available-for-sale debt securities $ 31,818 $ — $ (355 ) $ 31,463 (1) Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2018 , also included cash of $69,519 . December 31, 2017 (in thousands) Cost Gross unrealized gains Gross unrealized losses Fair value Funds held for customers: (1) Domestic money market fund $ 17,300 $ — $ — $ 17,300 Canadian and provincial government securities 9,051 — (393 ) 8,658 Canadian guaranteed investment certificates 7,955 — — 7,955 Available-for-sale debt securities $ 34,306 $ — $ (393 ) $ 33,913 (1) Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2017 , also included cash of $52,279 . Expected maturities of available-for-sale debt securities as of December 31, 2018 were as follows: (in thousands) Fair value Due in one year or less $ 25,195 Due in two to five years 3,398 Due in six to ten years 2,870 Available-for-sale debt securities $ 31,463 Further information regarding the fair value of available-for-sale debt securities can be found in Note 8. Property, plant and equipment – Property, plant and equipment was comprised of the following at December 31: 2018 2017 (in thousands) Gross carrying amount Accumulated depreciation Net carrying amount Gross carrying amount Accumulated depreciation Net carrying amount Land and improvements $ 28,199 $ (8,167 ) $ 20,032 $ 28,220 $ (8,064 ) $ 20,156 Buildings and improvements 116,348 (83,317 ) 33,031 114,793 (80,168 ) 34,625 Machinery and equipment 313,000 (275,721 ) 37,279 299,645 (269,788 ) 29,857 Property, plant and equipment $ 457,547 $ (367,205 ) $ 90,342 $ 442,658 $ (358,020 ) $ 84,638 Assets held for sale – Assets held for sale as of December 31, 2018 consisted of 1 small business customer list. Assets held for sale as of December 31, 2017 included 2 providers of printed and promotional products and 2 small business distributors, all of which were sold during 2018. Also during 2018, we sold several small business customer lists that did not meet the requirements to be classified as held for sale in the December 31, 2017 consolidated balance sheet. We determined that the assets sold would be better positioned for long-term growth if they were managed by independent distributors. Subsequent to the sales, the businesses and customer lists are owned by independent distributors that are part of our Safeguard distributor network. As such, our revenue is not impacted by these sales and the impact to our costs is not significant. We entered into aggregate notes receivable of $35,616 in conjunction with these sales and we recognized aggregate net gains of $15,641 within SG&A expense in the 2018 consolidated statement of income. During 2017, we sold a provider of printed and promotional products, assets associated with certain custom printing activities and 3 small business distributors. We entered into aggregate notes receivable of $24,497 in conjunction with these sales and we recognized aggregate net gains of $8,703 within SG&A expense in the 2017 consolidated statement of income. The assets sold during 2018 and 2017, as well as the customer list held for sale as of December 31, 2018, were included in our Small Business Services segment and consisted primarily of intangible assets. During 2017, we recorded aggregate pre-tax asset impairment charges of $8,250 related to a small business distributor sold during the second quarter of 2017. The impairment charges reduced the carrying value of the business to its fair value less costs to sell, as we finalized the sale of this business. We are actively marketing the remaining asset held for sale and we expect the selling price will equal or exceed its current carrying value. Net assets held for sale consisted of the following at December 31: (in thousands) 2018 2017 Balance sheet caption Current assets $ — $ 4 Other current assets Intangibles 1,350 8,459 Assets held for sale Goodwill — 3,566 Assets held for sale Other non-current assets — 207 Assets held for sale Net assets held for sale $ 1,350 $ 12,236 Intangibles – Intangibles were comprised of the following at December 31: 2018 2017 (in thousands) Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Indefinite-lived intangibles: Trade name (1) $ — $ — $ — $ 19,100 $ — $ 19,100 Amortizable intangibles: Internal-use software 388,477 (308,313 ) 80,164 359,079 (284,074 ) 75,005 Customer lists/relationships (2) 379,570 (170,973 ) 208,597 343,589 (121,729 ) 221,860 Trade names 50,645 (26,204 ) 24,441 36,931 (19,936 ) 16,995 Technology-based intangibles 39,300 (14,007 ) 25,293 31,800 (6,400 ) 25,400 Software to be sold 36,900 (15,430 ) 21,470 36,900 (11,204 ) 25,696 Other 700 (700 ) — 1,800 (1,590 ) 210 Amortizable intangibles 895,592 (535,627 ) 359,965 810,099 (444,933 ) 365,166 Intangibles $ 895,592 $ (535,627 ) $ 359,965 $ 829,199 $ (444,933 ) $ 384,266 (1) During the third quarter of 2018, we recorded a pre-tax asset impairment charge of $19,100 for our indefinite-lived trade name. Further information can be found in Note 8. (2) During 2018, we recorded pre-tax asset impairment charges of $4,031 related to amortizable customer lists. Further information can be found in Note 8. Amortization expense related to intangibles was as follows for the years ended December 31: (in thousands) 2018 2017 2016 Customer lists/relationships $ 57,243 $ 54,450 $ 33,233 Internal-use software 38,307 35,952 35,217 Technology-based intangibles 7,607 6,400 — Trade names 6,362 5,789 4,952 Other amortizable intangibles 5,009 4,193 3,683 Amortization of intangibles $ 114,528 $ 106,784 $ 77,085 Based on the intangibles in service as of December 31, 2018 , estimated amortization expense for each of the next five years ending December 31 is as follows: (in thousands) Estimated amortization expense 2019 $ 90,924 2020 71,135 2021 54,795 2022 39,571 2023 29,205 We acquire internal-use software in the normal course of business. We also acquire intangible assets in conjunction with acquisitions (Note 6). The following intangible assets were acquired during the years ended December 31: 2018 2017 2016 (in thousands) Amount Weighted-average amortization period (in years) Amount Weighted-average amortization period (in years) Amount Weighted-average amortization period (in years) Customer lists/relationships (1) $ 60,775 8 $ 60,034 7 $ 118,415 8 Internal-use software 42,744 3 38,422 3 45,780 4 Trade names 14,700 7 10,000 6 3,800 4 Technology-based intangibles 7,500 5 800 3 28,000 5 Software to be sold — — 2,200 5 6,200 10 Acquired intangibles $ 125,719 6 $ 111,456 6 $ 202,195 6 (1) During 2018, we acquired customer lists of $1,188 that did not qualify as business combinations. Information regarding acquired intangibles does not include measurement-period adjustments for changes in the estimated fair values of intangibles acquired through acquisitions. Information regarding these adjustments can be found in Note 6. Goodwill – Changes in goodwill by reportable segment and in total were as follows: (in thousands) Small Business Services Financial Services Direct Checks Total Balance, December 31, 2016: Goodwill, gross $ 684,261 $ 293,189 $ 148,506 $ 1,125,956 Accumulated impairment charges (20,000 ) — — (20,000 ) Goodwill, net of accumulated impairment charges 664,261 293,189 148,506 1,105,956 Impairment charge (Note 8) (28,379 ) — — (28,379 ) Goodwill resulting from acquisitions (Note 6) 26,788 33,210 — 59,998 Measurement-period adjustments for prior year acquisitions (Note 6) 30 (2,160 ) — (2,130 ) Sale of small business distributor (1,000 ) — — (1,000 ) Reclassification of assets held for sale (3,970 ) — — (3,970 ) Currency translation adjustment 459 — — 459 Balance, December 31, 2017: Goodwill, gross 706,568 324,239 148,506 1,179,313 Accumulated impairment charges (48,379 ) — — (48,379 ) Goodwill, net of accumulated impairment charges 658,189 324,239 148,506 1,130,934 Impairment charge (Note 8) (78,188 ) — — (78,188 ) Goodwill resulting from acquisitions (Note 6) 59,488 46,419 — 105,907 Measurement-period adjustments for prior year acquisitions (Note 6) 1,420 2,763 — 4,183 Adjustment of assets held for sale 635 — — 635 Currency translation adjustment (2,845 ) — — (2,845 ) Balance, December 31, 2018: Goodwill, gross 765,266 373,421 148,506 1,287,193 Accumulated impairment charges (126,567 ) — — (126,567 ) Goodwill, net of accumulated impairment charges $ 638,699 $ 373,421 $ 148,506 $ 1,160,626 Other non-current assets – Other non-current assets were comprised of the following at December 31: (in thousands) 2018 2017 Loans and notes receivable from Safeguard distributors $ 78,693 $ 44,276 Prepaid product discounts (1) 54,642 63,895 Postretirement benefit plan asset (Note 14) 41,259 39,849 Deferred sales commissions (2) 6,482 — Deferred advertising costs 5,746 6,135 Other 9,286 5,601 Other non-current assets $ 196,108 $ 159,756 (1) In our prior year financial statements, we referred to this asset as contract acquisition costs. (2) Net of amortization of $2,722 for the year ended December 31, 2018. Changes in prepaid product discounts were as follows for the years ended December 31: (in thousands) 2018 2017 2016 Balance, beginning of year $ 63,895 $ 65,792 $ 58,792 Additions (1) 14,023 18,224 27,506 Amortization (22,941 ) (19,969 ) (20,185 ) Other (335 ) (152 ) (321 ) Balance, end of year $ 54,642 $ 63,895 $ 65,792 (1) Prepaid product discounts are generally accrued upon contract execution. Cash payments made for prepaid product discounts were $23,814 for 2018 , $27,079 for 2017 and $23,068 for 2016 . Accrued liabilities – Accrued liabilities were comprised of the following at December 31: (in thousands) 2018 2017 Funds held for customers $ 99,818 $ 85,091 Deferred revenue 54,313 47,021 Employee profit sharing/cash bonus 31,286 31,312 Prepaid product discounts due within one year (1) 10,926 11,670 Customer rebates 9,555 11,508 Income tax 7,991 17,827 Acquisition-related liabilities (2) 4,850 23,878 Restructuring and integration (Note 9) 3,320 4,380 Other 62,222 44,566 Accrued liabilities $ 284,281 $ 277,253 (1) In our prior year financial statements, we referred to this liability as contract acquisition costs due within one year. (2) Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 8. Other non-current liabilities – Other non-current liabilities were comprised of the following at December 31: (in thousands) 2018 2017 Prepaid product discounts (1) $ 12,513 $ 21,658 Other 27,367 30,583 Other non-current liabilities $ 39,880 $ 52,241 (1) In our prior year financial statements, we referred to this liability as contract acquisition costs. Supplemental cash flow information – Supplemental cash flow information was as follows for the years ended December 31: (in thousands) 2018 2017 2016 Reconciliation of cash, cash equivalents, restricted cash and restricted cash equivalents to the consolidated balance sheets: Cash and cash equivalents $ 59,740 $ 59,240 $ 76,574 Restricted cash and restricted cash equivalents included in funds held for customers 85,519 69,579 72,291 Total cash, cash equivalents, restricted cash and restricted cash equivalents $ 145,259 $ 128,819 $ 148,865 Income taxes paid $ 88,253 $ 124,878 $ 97,309 Interest paid 25,910 19,465 20,975 Non-cash investing activities: Proceeds from sales of assets – notes receivable 35,616 24,497 — Acquisition-related liabilities (1) 3,011 5,855 27,441 (1) Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 8. |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share The following table reflects the calculation of basic and diluted earnings per share. During each period, certain stock options, as noted below, were excluded from the calculation of diluted earnings per share because their effect would have been antidilutive. (in thousands, except per share amounts) 2018 2017 2016 Earnings per share – basic: Net income $ 149,630 $ 230,155 $ 229,382 Income allocated to participating securities (617 ) (1,457 ) (1,870 ) Income available to common shareholders $ 149,013 $ 228,698 $ 227,512 Weighted-average shares outstanding 46,842 48,127 48,562 Earnings per share – basic $ 3.18 $ 4.75 $ 4.68 Earnings per share – diluted: Net income $ 149,630 $ 230,155 $ 229,382 Income allocated to participating securities (616 ) (1,450 ) (1,858 ) Re-measurement of share-based awards classified as liabilities (471 ) 59 296 Income available to common shareholders $ 148,543 $ 228,764 $ 227,820 Weighted-average shares outstanding 46,842 48,127 48,562 Dilutive impact of potential common shares 149 321 413 Weighted-average shares and potential common shares outstanding 46,991 48,448 48,975 Earnings per share – diluted $ 3.16 $ 4.72 $ 4.65 Antidilutive options excluded from calculation 1,209 262 214 |
Other comprehensive (loss) inco
Other comprehensive (loss) income | 12 Months Ended |
Dec. 31, 2018 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Other comprehensive (loss) income | Other comprehensive (loss) income Reclassification adjustments – Information regarding amounts reclassified from accumulated other comprehensive loss to net income was as follows: Accumulated other comprehensive loss components Amounts reclassified from accumulated other comprehensive loss Affected line item in consolidated statements of income (in thousands) 2018 2017 2016 Amortization of postretirement benefit plan items: Prior service credit $ 1,421 $ 1,421 $ 1,421 Other income Net actuarial loss (2,884 ) (3,637 ) (3,797 ) Other income Total amortization (1,463 ) (2,216 ) (2,376 ) Other income Tax benefit 491 372 724 Income tax provision Total reclassifications, net of tax $ (972 ) $ (1,844 ) $ (1,652 ) Net income Accumulated other comprehensive loss – Changes in the components of accumulated other comprehensive loss were as follows for the years ended December 31: (in thousands) Postretirement benefit plans, net of tax Net unrealized loss on marketable debt securities, net of tax Currency translation adjustment Accumulated other comprehensive loss Balance, December 31, 2015 $ (38,822 ) $ (114 ) $ (16,267 ) $ (55,203 ) Other comprehensive income (loss) before reclassifications 1,486 (99 ) 1,793 3,180 Amounts reclassified from accumulated other comprehensive loss 1,652 — — 1,652 Net current-period other comprehensive income (loss) 3,138 (99 ) 1,793 4,832 Balance, December 31, 2016 (35,684 ) (213 ) (14,474 ) (50,371 ) Other comprehensive income (loss) before reclassifications 7,011 (109 ) 4,028 10,930 Amounts reclassified from accumulated other comprehensive loss 1,844 — — 1,844 Net current-period other comprehensive income (loss) 8,855 (109 ) 4,028 12,774 Balance, December 31, 2017 (26,829 ) (322 ) (10,446 ) (37,597 ) Other comprehensive loss before reclassifications (3,805 ) (1 ) (9,281 ) (13,087 ) Amounts reclassified from accumulated other comprehensive loss 972 — — 972 Net current-period other comprehensive loss (2,833 ) (1 ) (9,281 ) (12,115 ) Adoption of ASU No. 2018-02 (Note 2) (6,867 ) — — (6,867 ) Balance, December 31, 2018 $ (36,529 ) $ (323 ) $ (19,727 ) $ (56,579 ) |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions We regularly complete business combinations that align with our business strategy. The assets and liabilities acquired are recorded at their estimated fair values, and the results of operations of each acquired business are included in our consolidated statements of income from their acquisition dates. Transaction costs related to acquisitions are expensed as incurred and are included in SG&A expense in the consolidated statements of income. Transaction costs totaled $1,719 in 2018 , $2,342 in 2017 and $4,944 in 2016 . The acquisitions completed during the past 3 years were cash transactions, funded by use of our revolving credit facility. We completed these acquisitions primarily to increase our mix of marketing solutions and other services revenue, to add financial technology and web services capabilities, to improve our product and service offerings and to reach new customers. 2018 acquisitions – During 2018, we completed the following acquisitions that were included within our Small Business Services segment: • In March 2018, we acquired all of the equity of Logomix Inc. (Logomix), a self-service marketing and branding platform that helps small businesses create logos and custom marketing products. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in nondeductible goodwill of $29,451 . The acquisition resulted in goodwill as we expect to accelerate revenue growth by combining our capabilities with Logomix's platform. • In June 2018, we acquired selected assets of Velocity Servers, Inc., doing business as ColoCrossing, a data center solutions, cloud hosting and infrastructure colocation provider of dedicated hosting services. The preliminary allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $9,689 . The acquisition resulted in goodwill as we expect to accelerate revenue growth by bringing colocation services into our portfolio of hosting services. We expect to finalize the allocation of the purchase price in the first quarter of 2019, when our valuation of the acquired intangible assets is complete. • In December 2018, we acquired selected assets of My Corporation Business Services, Inc., a provider of business incorporation and organization services. The preliminary allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $20,348 . The acquisition resulted in goodwill as we expect to accelerate revenue growth by bringing these services into our portfolio of web services. We expect to finalize the allocation of the purchase price in 2019, when our valuation of the acquired intangible assets, as well as various other assets acquired and liabilities assumed, is complete. • During 2018, we acquired the operations of 3 small business distributors. The assets acquired consisted primarily of customer list intangible assets. As these small business distributors were previously part of our Safeguard distributor network, our revenue was not impacted by these acquisitions, and the impact to our costs was not significant. Within our Financial Services segment, we acquired the equity of REMITCO LLC (RemitCo) in August 2018. RemitCo was the remittance processing business of First Data Corporation. The preliminary allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $46,419 and a customer list intangible asset of $36,000 . The acquisition resulted in goodwill as it expands the scale of our receivables management solutions, which allows us to take advantage of the ongoing market trend toward outsourcing technology-enabled services to trusted financial technology partners of scale. We expect to finalize the allocation of the purchase price by mid-2019, when our valuation of miscellaneous assets acquired and liabilities assumed is complete. 2017 acquisitions – During 2017, we completed the following acquisitions that were included within our Small Business Services segment: • In February 2017, we acquired selected assets of Panthur Pty Ltd (Panthur), an Australian web hosting and domain registration service provider. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in nondeductible goodwill of $1,198 . The acquisition resulted in goodwill as we used Panthur's platform to selectively expand into foreign markets. • In July 2017, we acquired all of the equity of Digital Pacific Group Pty Ltd (Digital Pacific), an Australian web hosting and domain registration service provider. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in nondeductible goodwill of $23,773 . The acquisition resulted in goodwill as we acquired enhanced web hosting capabilities that we used to selectively expand into foreign markets. • In September 2017, we acquired all of the equity of j2 Global Australia Pty Ltd, doing business as Web24, an Australian web hosting and domain registration service provider. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in nondeductible goodwill of $2,731 . The acquisition resulted in goodwill as we used Web24's platform to selectively expand into foreign markets. • In November 2017, we acquired selected assets of Impact Marketing Specialists, Inc., which provides marketing solutions to real estate agents. • In December 2017, we acquired selected assets of SY Holdings, LLC, doing business as managed.com, a web hosting services provider. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $266 . The acquisition resulted in goodwill as the expertise we acquired improved our customer mix and enhanced our portfolio of web services. • During 2017, we acquired the operations of several small business distributors. The assets acquired consisted primarily of customer list intangible assets. All but 1 of these distributors were previously part of our Safeguard distributor network. As such, our results of operations were not significantly impacted by these acquisitions. Within our Financial Services segment, we acquired all of the equity of RDM Corporation (RDM) of Canada in April 2017. RDM is a provider of remote deposit capture software, hardware and digital imaging solutions for financial institutions and corporate clients. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in nondeductible goodwill of $35,973 . The acquisition resulted in goodwill as it enhanced our selection of treasury management solutions, strengthening our value proposition and improving our market position. 2016 acquisitions – During 2016, we completed the following acquisitions that were included within our Small Business Services segment: • In February 2016, we acquired selected assets of Category 99, Inc., doing business as MacHighway ® , a web hosting and domain registration service provider. • In March 2016, we acquired selected assets of New England Art Publishers, Inc., doing business as Birchcraft Studios, a supplier of personalized invitations, holiday cards, all-occasion cards and social announcements. • In April 2016, we acquired selected assets of 180 Fusion LLC, a digital marketing services provider. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $800 . The acquisition resulted in goodwill as it enhanced our Small Business Services product set by providing valuable marketing tools to our customers, thus, enhancing customer acquisition and loyalty. • In June 2016, we acquired selected assets of L.A.M. Enterprises, Inc., a provider of printed and promotional products. • In June 2016, we acquired selected assets of National Document Solutions, LLC, a provider of printing, promotional products, office products, scanning and document management solutions. • In June 2016, we acquired selected assets of Liquid Web, LLC, a web hosting services provider. • In July 2016, we acquired selected assets of Inkhead, Inc., a provider of customized promotional products. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $4,421 . The acquisition resulted in goodwill as it enabled us to diversify our promotional product offerings and bring these offerings to our customer base. • In August 2016, we acquired selected assets of BNBS, Inc., doing business as B&B Solutions, a provider of printing, promotional and office products and services. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $850 . The acquisition resulted in goodwill as it enabled us to diversify our product offerings and bring these offerings to our customer base. • In September 2016, we acquired all of the outstanding capital stock of Payce, Inc., a provider of payroll processing, payroll tax filing and related payroll services. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $6,882 . The acquisition resulted in goodwill as Payce's expertise, customer mix and operational strength enhanced our existing portfolio of web services. • In October 2016, we acquired selected assets of Excel Graphic Services, Inc., a provider of printing, promotional products and document management services. • In October 2016, we acquired selected assets of PTM Document Systems, Inc., the exclusive source of the Print to Mail™ systems used in schools, hospitals and businesses. • In December 2016, we acquired selected assets of Digihost Ltd., a web services provider located in Ireland. • During 2016, we acquired the operations of several small business distributors. The assets acquired consisted primarily of customer list intangible assets. As these distributors were previously part of our Safeguard distributor network, our results of operations were not significantly impacted by these acquisitions. Within Financial Services, we completed the following acquisitions: • In October 2016, we acquired selected assets of Data Support Systems, Inc., a provider of image-based software for payment-related back-office case management. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $4,025 . The acquisition resulted in goodwill as Data Support Systems' solutions were complementary to those of our Wausau Financial Services business, which created significant cross-sell opportunities. • In December 2016, we acquired all of the equity of First Manhattan Consulting Group, LLC (FMCG), a provider of data-driven marketing solutions for financial institutions. The allocation of the purchase price based upon the estimated fair values of the assets acquired and liabilities assumed resulted in tax-deductible goodwill of $110,219 . The acquisition resulted in goodwill due to revenue synergies with our Datamyx business, cost synergies such as leveraging common data sources, and the ability to bring FMCG's solutions to our client base. The allocation of the purchase price to the assets acquired and liabilities assumed for the FMCG acquisition was as follows: (in thousands) FMCG Net tangible assets acquired and liabilities assumed (1) $ 4,334 Identifiable intangible assets: Customer list/relationships 53,000 Technology-based intangible 31,000 Trade name 3,000 Total intangible assets (2) 87,000 Goodwill 110,219 Total aggregate purchase price 201,553 Liability for holdback payments (16,000 ) Payment for acquisition, net of cash acquired $ 185,553 (1) Net tangible assets acquired consisted primarily of accounts receivable, revenue in excess of billings and accounts payable outstanding as of the date of acquisition. (2) The useful lives of the acquired intangible assets were as follows: customer list/relationships – 7 years; technology-based intangible – 5 years; and trade name – 4 years. Aggregate information – Information regarding goodwill by reportable segment and the useful lives of acquired intangibles can be found in Note 3. Information regarding the calculation of the estimated fair values of the acquired intangibles can be found in Note 8. As our acquisitions were not significant to our reported operating results both individually and in the aggregate, pro forma results of operations are not provided. The following illustrates the allocation of the aggregate purchase price for the above acquisitions to the assets acquired and liabilities assumed: (in thousands) 2018 acquisitions (1) 2017 acquisitions (2) 2016 acquisitions (3) Net tangible assets acquired and liabilities assumed (4) $ 9,366 $ (1,956 ) $ (8,804 ) Identifiable intangible assets: Customer lists/relationships 59,587 58,620 116,491 Trade names 14,700 10,000 3,800 Software to be sold — 2,200 6,200 Technology-based intangibles 7,500 800 31,000 Internal-use software — 1,445 10,450 Total intangible assets 81,787 73,065 167,941 Goodwill 105,907 63,941 127,197 Total aggregate purchase price 197,060 135,050 286,334 Liabilities for holdback payments and contingent consideration (5) (3,011 ) (5,980 ) (27,441 ) Non-cash consideration (6) (1,060 ) — (2,020 ) Net cash paid for current year acquisitions 192,989 129,070 256,873 Measurement-period adjustment for 2015 acquisition (7) — — (18,743 ) Holdback payments for prior year acquisitions 21,269 10,153 1,534 Payments for acquisitions, net of cash acquired (8) $ 214,258 $ 139,223 $ 239,664 (1) Net tangible assets acquired and liabilities assumed for 2018 consisted primarily of REMITCO accounts receivable and Logomix deferred income tax liabilities. (2) Net tangible assets acquired and liabilities assumed for 2017 consisted primarily of accounts receivable, marketable securities, inventory and accrued liabilities of RDM and Digital Pacific. Amounts include measurement-period adjustments recorded in 2018 for the finalization of purchase accounting for several of the 2017 acquisitions. These adjustments increased goodwill $4,183 , with the offset to various assets and liabilities, including deferred revenue, deferred income taxes and other long-term liabilities, as well as a decrease of $1,654 in customer list intangibles and an increase in internal-use software of $1,000 . (3) Net tangible assets acquired and liabilities assumed for 2016 included customer funds obligations of $12,532 related to the acquisition of Payce, Inc., as well as accounts receivable, revenue in excess of billings and accounts payable of FMCG. Amounts include measurement-period adjustments recorded in 2017 for the finalization of purchase accounting for several of the 2016 acquisitions. These adjustments decreased goodwill $2,130 , with the offset to various assets and liabilities, including other current assets, accounts payable and intangibles, including an increase of $3,000 in acquired technology-based intangibles and a decrease of $1,924 in customer list intangibles. (4) Net tangible assets acquired included trade accounts receivable of $11,564 during 2018 , $4,544 during 2017 and $8,065 during 2016 . (5) Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 8. (6) Consists of pre-acquisition amounts owed to us by certain of the acquired businesses. (7) Reflects a measurement-period adjustment recorded in 2016 for funds held for customers of FISC Solutions, which was acquired in December 2015. Cash and cash equivalents included in funds held for customers are presented as restricted cash and restricted cash equivalents in the consolidated statements of cash flows. (8) Cash and cash equivalents acquired were $1,645 during 2018 , $27,299 during 2017 and $146 during 2016 |
Derivative financial instrument
Derivative financial instruments | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative financial instruments | Derivative financial instruments During 2011 and 2012, we entered into interest rate swaps, which we designated as fair value hedges, to hedge against changes in the fair value of a portion of our long-term debt. At the time we entered into these swaps, we were targeting a mix of fixed and variable rate debt, where we received a fixed rate and paid a variable rate based on the London Interbank Offered Rate (LIBOR). As of December 31, 2015, we had interest rate swaps with a notional amount of $200,000 that related to our long-term debt due in 2020. These swaps met the criteria for using the short-cut method for a fair value hedge based on the structure of the hedging relationship. As such, changes in the fair value of the derivatives and the related long-term debt were equal. The related long-term debt was retired during 2016 (Note 15) and we concurrently settled the interest rate swaps, resulting in a cash payment of $2,842 |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Fair value measurements Annual asset impairment analyses – We evaluate the carrying value of goodwill and our indefinite-lived trade name as of July 31 of each year and between annual evaluations if events occur or circumstances change that would indicate a possible impairment. Our policy on impairment of indefinite-lived intangibles and goodwill, which is included in Note 1, explains our methodology for assessing impairment of these assets. • 2018 impairment analyses – In completing the 2018 annual impairment analysis of goodwill, we elected to perform a qualitative assessment for 5 of our reporting units and a quantitative assessment for 2 of our reporting units: Small Business Services Web Services and Small Business Services Indirect. Small Business Services Web Services includes our businesses that provide hosting and domain name services, logo and web design, search engine marketing and optimization, payroll services and business incorporation and organization services. Small Business Services Indirect consists primarily of our Safeguard distributor channel, former Safeguard distributors that we have purchased, and our independent dealer channel. The qualitative analyses evaluated factors, including, but not limited to, economic, market and industry conditions, cost factors and the overall financial performance of the reporting units. We also considered the quantitative analyses completed as of July 31, 2017, which indicated that the estimated fair values of the 5 reporting units exceeded their carrying values by approximate amounts between $64,000 and $1,405,000 , or by amounts between 50% and 314% above the carrying values of their net assets. In completing these assessments, we noted no changes in events or circumstances that indicated that it was more likely than not that the fair value of any reporting unit was less than its carrying amount. The quantitative analysis as of July 31, 2018 for the Small Business Services Web Services reporting unit indicated that the estimated fair value of the reporting unit exceeded its carrying value by approximately $63,000 , or 22% . The carrying value of this reporting unit's goodwill was $225,383 as of July 31, 2018. The quantitative analysis of the Small Business Services Indirect reporting unit indicated that the reporting unit's goodwill was fully impaired, resulting in a pre-tax goodwill impairment charge of $78,188 during the quarter ended September 30, 2018. The impairment charge was measured as the amount by which the reporting unit's carrying value exceeded its estimated fair value, limited to the carrying amount of goodwill. The analysis of this reporting unit, which incorporated the results of the annual strategic planning process completed during the third quarter of 2018, indicated lowered projected long-term revenue growth and profitability levels resulting from changes in strategy and focus and in the mix of products and services sold, including the continuing secular decline in check and forms usage. Additionally, our strategic plan reflected a shift in company resources to our growing businesses. Our indefinite-lived Safeguard trade name was included in the Small Business Services Indirect reporting unit. As of July 31, 2018, we completed a quantitative analysis of this asset that indicated the asset was fully impaired (level 3 fair value measurement), resulting in a pretax asset impairment charge of $19,100 . This impairment charge was driven by the same factors that resulted in the goodwill impairment charge, which indicated that any royalties attributable to the asset under our relief from royalty calculation had no future value. • 2017 impairment analyses – In conjunction with our annual strategic planning process during the third quarter of 2017, we made various changes to our internal reporting structure. As a result, we reassessed our operating segments and determined that no changes were required in our reportable operating segments. We also reassessed our previously determined reporting units and concluded that a realignment of a portion of our reporting units was required. As such, we reallocated the carrying value of goodwill to our revised reporting units based on their relative fair values. We analyzed goodwill for impairment immediately prior to this realignment by performing qualitative analyses for our Small Business Services reporting units and quantitative analyses for our Financial Services and Direct Checks reporting units. The qualitative analyses evaluated factors including, but not limited to, economic, market and industry conditions, cost factors and the overall financial performance of the reporting units. We also considered the last quantitative analysis we completed. In completing these assessments, we noted no changes in events or circumstances that indicated that it was more likely than not that the fair value of any reporting unit was less than its carrying amount, with the exception of our Small Business Services Safeguard reporting unit. The analysis of this reporting unit, which incorporated the results of the annual strategic planning process, indicated lowered projected long-term revenue growth and profitability levels resulting from changes in market trends and the mix of products and services sold, including the continuing secular decline in check and forms usage. As a result, we completed impairment analyses of the long-term assets of this reporting unit, excluding goodwill, and concluded that these assets were not impaired. We then completed the quantitative analysis of the reporting unit, utilizing the income approach outlined in Note 1. This quantitative analysis indicated that this reporting unit's goodwill was fully impaired and resulted in a non-cash pre-tax goodwill impairment charge of $28,379 during the quarter ended September 30, 2017. The impairment charge was measured as the amount by which the reporting unit's carrying value exceeded its estimated fair value, limited to the carrying amount of goodwill. Immediately subsequent to the realignment of our reporting unit structure, we completed a quantitative analysis for all of our reporting units. This quantitative analysis as of July 31, 2017 indicated that the estimated fair values of our reporting units exceeded their carrying values by approximate amounts between $64,000 and $1,405,000 , or by amounts between 36% and 314% above the carrying values of their net assets. In completing the 2017 annual impairment analysis of our indefinite-lived trade name, we elected to perform a quantitative assessment, which indicated that the calculated fair value of the asset exceeded its carrying value of $19,100 by approximately $16,000 as of July 31, 2017. • 2016 impairment analyses – In completing the 2016 annual goodwill impairment analyses, we elected to perform qualitative assessments for all of our reporting units to which goodwill was assigned, with one exception. We elected to perform a quantitative analysis for our Financial Services Commercial reporting unit. This reporting unit was acquired subsequent to our 2014 annual impairment analysis and the quantitative analysis completed as of July 31, 2015 indicated that the estimated fair value of this reporting unit exceeded its carrying value by approximately 13% . The quantitative assessment completed for this reporting unit as of July 31, 2016 indicated that its estimated fair value exceeded its carrying value by approximately 49% . Total goodwill for this reporting unit was approximately $45,000 as of the date of the 2016 assessment. Our qualitative analyses completed during 2016 evaluated factors including, but not limited to, economic, market and industry conditions, cost factors and the overall financial performance of the reporting units. We also considered the quantitative analyses we completed as of July 31, 2014. In completing these assessments, we noted no changes in events or circumstances which indicated that it was more likely than not that the fair value of any reporting unit was less than its carrying amount. In the completing the 2016 annual impairment analysis of our indefinite-lived trade name, we elected to perform a quantitative assessment, which indicated that the calculated fair value of the asset exceeded its carrying value of $19,100 by approximately $32,000 as of July 31, 2016. Based on the results of our annual impairment analyses, we recorded no impairment charges during 2016. Other non-recurring asset impairment analyses – During the fourth quarter of 2018, we performed a quantitative analysis of our Financial Services Data-Driven Marketing reporting unit. Revenue for this reporting unit was below our projections driven by higher mortgage lending rates, which result in less lending activity for our financial institution clients and thus, may cause them to reduce their marketing spending, as well as a large client electing to do certain of its marketing in-house. The quantitative analysis as of December 31, 2018 indicated that the estimated fair value of the reporting unit exceeded its carrying value by approximately $105,000 , or 36% . As such, no goodwill impairment charge was recorded for this reporting unit. The carrying value of this reporting unit's goodwill was $186,388 as of December 31, 2018. During the third quarter of 2018, we recorded pre-tax asset impairment charges of $1,882 for Financial Services customer list intangible assets related to 2 distributors we acquired in 2015. Based on higher than anticipated customer attrition, we determined that the customer lists were partially impaired as of July 31, 2018. During the first quarter of 2018, we recorded a pre-tax asset impairment charge of $2,149 related to a Small Business Services customer list intangible asset. Based on changes in the customer base of one of our small business distributors, we determined that the customer list asset was fully impaired as of March 31, 2018. We utilized the discounted value of estimated future cash flows to estimate the fair values of these asset groups. During 2017, we recorded aggregate pre-tax asset impairment charges of $8,250 related to a small business distributor that was classified as held for sale in the consolidated balance sheets prior to its sale during the second quarter of 2017. The impairment charges were calculated based on ongoing negotiations for the sale of the business and reduced its carrying value to its fair value less costs to sell by reducing the carrying value of the related customer list intangible asset. Further information regarding assets held for sale can be found in Note 3. During the quarter ended September 30, 2017, we decided that we would no longer utilize our Small Business Services NEBS ® trade name in the marketplace, and we recorded a non-cash pre-tax asset impairment charge of $14,752 to write down the remaining book value of this trade name to a fair value of $0 . Also during the quarter ended September 30, 2017, we recorded pre-tax asset impairment charges of $3,499 related to other long-lived assets within Small Business Services, primarily internal-use software related to an order capture system. During the third quarter of 2017, we signed a contract for customer relationship management services that resulted in our decision to no longer utilize a portion of this software. As such, the remaining net book value of the assets was written down to a fair value of $0 . Information regarding these other nonrecurring asset impairment analyses was as follows: Fair value measurements using Fair value as of measurement date Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Asset impairment charge (in thousands) (Level 1) (Level 2) (Level 3) 2018 analyses: Customer list (Small Business Services) $ — $ — $ — $ — $ 2,149 Customer lists (Financial Services) (1) 4,223 — — 4,223 1,882 Total $ 4,031 2017 analyses: Trade name $ — $ — $ — $ — $ 14,752 Assets held for sale 3,500 — — 3,500 8,250 Other — — — — 3,499 Total $ 26,501 (1) The fair value presented is for the entire asset group that includes the impaired customer lists. Acquisitions – For all acquisitions, we are required to measure the fair value of the net identifiable tangible and intangible assets and liabilities acquired. Information regarding our acquisitions can be found in Note 6 and information regarding the useful lives of acquired intangibles can be found in Note 3. The identifiable net assets acquired during the past 3 years were comprised primarily of customer list intangible assets, technology-based intangible assets, trade names and software. The fair value of the more significant acquired customer lists was estimated using the multi-period excess earnings method. This valuation model estimates revenues and cash flows derived from the asset and then deducts portions of the cash flow that can be attributed to supporting assets, such as a trade name or fixed assets, that contributed to the generation of the cash flows. The resulting cash flow, which is attributable solely to the customer list asset, is then discounted at a rate of return commensurate with the risk of the asset to calculate a present value. The estimated fair value of the remainder of our acquired customer lists was estimated by discounting the estimated cash flows expected to be generated by the assets. Key assumptions used in these calculations included same-customer revenue growth rates, estimated earnings and estimated customer retention rates based on the acquirees' historical information. The estimated fair value of the acquired technology-based intangibles, trade names and a portion of the acquired software was estimated using the relief from royalty method, which calculates the cost savings associated with owning rather than licensing the assets. Assumed royalty rates were applied to projected revenue for the estimated remaining useful lives of the assets to estimate the royalty savings. Royalty rates are selected based on the attributes of the asset, including its recognition and reputation in the industry, and in the case of trade names, with consideration of the specific profitability of the products sold under a trade name and supporting assets. The fair value of the remainder of the acquired software was estimated using the cost of reproduction method. The primary components of the software were identified and the estimated cost to reproduce the software was calculated based on historical data provided by the acquirees. For liabilities for contingent consideration recorded in conjunction with our acquisitions, we determined the fair value as of the acquisition dates by discounting to present value the probability-weighted contingent payments expected to be made. Key assumptions used in these calculations included the discount rate; projected revenue, gross profit or operating income, as appropriate, based on projected financial results of the acquired businesses from the perspective of an unrelated market participant; and factors indicating the probability of achieving the forecasted revenue, gross profit or operating income. The liabilities for contingent consideration related primarily to the acquisitions of Verify Valid and a small business distributor during 2015 and the acquisition of Data Support Systems during 2016. Under the Verify Valid and Data Support Systems agreements, there are no maximum amounts of contingent payments specified , although payments are based on a percentage of the revenue or operating income generated by the business. Recurring fair value measurements – Funds held for customers included cash equivalents and available-for-sale debt securities (Note 3). The cash equivalents consisted of a money market fund investment that is traded in an active market. Because of the short-term nature of the underlying investments, the cost of this investment approximates its fair value. Available-for-sale debt securities consisted of a mutual fund investment that invests in Canadian and provincial government securities and investments in Canadian guaranteed investment certificates (GIC's) with maturities of 1 year or less. The mutual fund is not traded in an active market and its fair value is determined by obtaining quoted prices in active markets for the underlying securities held by the fund. The fair value of the GIC's approximated cost due to their relatively short duration. Unrealized gains and losses, net of tax, are included in accumulated other comprehensive loss in the consolidated balance sheets. The cost of securities sold is determined using the average cost method. Realized gains and losses are included in revenue in the consolidated statements of income and were not significant during the past 3 years. The fair value of accrued contingent consideration is remeasured each reporting period. Increases or decreases in projected revenue, gross profit or operating income, as appropriate, and the related probabilities of achieving the forecasted results, may result in a higher or lower fair value measurement. Changes in fair value resulting from changes in the timing, amount of, or likelihood of contingent payments are included in SG&A expense in the consolidated statements of income. Changes in fair value resulting from accretion for the passage of time are included in interest expense in the consolidated statements of income. Changes in accrued contingent consideration were as follows: (in thousands) 2018 2017 2016 Balance, beginning of year $ 3,623 $ 4,682 $ 5,861 Acquisition date fair value 100 — 1,132 Change in fair value 610 1,190 (1,174 ) Payments (1,937 ) (2,249 ) (1,137 ) Balance, end of year $ 2,396 $ 3,623 $ 4,682 The fair value of interest rate swaps outstanding during 2016 (Note 7) was determined at each reporting date by means of a pricing model utilizing readily observable market interest rates. The change in fair value was determined as the change in the present value of estimated future cash flows discounted using the LIBOR rate. The interest rate swaps related to our long-term debt due in 2020 that we settled during the fourth quarter of 2016. The swaps met the criteria for using the short-cut method for a fair value hedge based on the structure of the hedging relationship. As such, changes in the fair value of the derivative and the related long-term debt were equal and were as follows for the year ended December 31, 2016: (in thousands) 2016 Gain from derivatives $ 1,200 Loss from change in fair value of hedged debt (1,200 ) Net effect on interest expense $ — Information regarding the fair values of our financial instruments was as follows: Fair value measurements using December 31, 2018 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs (in thousands) Carrying value Fair value (Level 1) (Level 2) (Level 3) Measured at fair value through net income: Accrued contingent consideration $ (2,396 ) $ (2,396 ) $ — $ — $ (2,396 ) Measured at fair value through comprehensive income: Cash equivalents (funds held for customers) 16,000 16,000 16,000 — — Available-for-sale debt securities (funds held for customers) 15,463 15,463 — 15,463 — Amortized cost: Cash 59,740 59,740 59,740 — — Cash (funds held for customers) 69,519 69,519 69,519 — — Loans and notes receivable from Safeguard distributors 81,560 60,795 — — 60,795 Long-term debt (1) 910,000 910,000 — 910,000 — (1) Amounts exclude capital lease obligations. Fair value measurements using December 31, 2017 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs (in thousands) Carrying value Fair value (Level 1) (Level 2) (Level 3) Measured at fair value through net income: Accrued contingent consideration $ (3,623 ) $ (3,623 ) $ — $ — $ (3,623 ) Measured at fair value through comprehensive income: Cash equivalents (funds held for customers) 17,300 17,300 17,300 — — Available-for-sale debt securities (funds held for customers) 16,613 16,613 — 16,613 — Amortized cost: Cash 59,240 59,240 59,240 — — Cash (funds held for customers) 52,279 52,279 52,279 — — Loans and notes receivable from Safeguard distributors 46,409 44,650 — — 44,650 Long-term debt (1) 707,386 707,938 — 707,938 — (1) Amounts exclude capital lease obligations. |
Restructuring and integration e
Restructuring and integration expense | 12 Months Ended |
Dec. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and integration expense | Restructuring and integration expense Net restructuring and integration expense for the years ended December 31 consisted of the following components: (dollars in thousands) 2018 2017 2016 Severance accruals $ 7,672 $ 7,843 $ 7,217 Severance reversals (1,898 ) (667 ) (864 ) Operating lease obligations 597 23 59 Operating lease reversals (71 ) — — Net accruals 6,300 7,199 6,412 Other costs 14,903 1,931 1,359 Restructuring and integration expense $ 21,203 $ 9,130 $ 7,771 Number of employees included in severance accruals 205 200 265 Net restructuring and integration expense for the years ended December 31 is reflected in the consolidated statements of income as follows: (in thousands) 2018 2017 2016 Total cost of revenue $ 1,466 $ 568 $ 647 Operating expenses 19,737 8,562 7,124 Restructuring and integration expense $ 21,203 $ 9,130 $ 7,771 In each of the past 3 years, the net accruals included severance charges related to employee reductions across functional areas as we continued to reduce costs, primarily within our sales and marketing, information technology and fulfillment functions, as well as employee reductions related to our integration initiatives. These charges were reduced by the reversal of accruals when fewer employees received severance benefits than originally estimated. Other restructuring and integration costs, which were expensed as incurred, included items such as information technology costs, employee and equipment moves, training and travel. During 2018, these costs related primarily to the integration of acquired businesses and the consolidation of information technology systems. Restructuring and integration accruals of $3,461 as of December 31, 2018 are reflected in the consolidated balance sheet as accrued liabilities of $3,320 and other non-current liabilities of $141 . Restructuring and integration accruals of $4,380 as of December 31, 2017 are included in accrued liabilities in the consolidated balance sheet. The majority of the employee reductions are expected to be completed by mid-2019, and we expect most of the related severance payments to be paid by the third quarter of 2019, utilizing cash from operations. The remaining amounts due under operating lease obligations will be paid by December 2020. As of December 31, 2018 , approximately 30 employees had not yet started to receive severance benefits. Restructuring and integration accruals, summarized by year, were as follows: (in thousands) 2018 initiatives 2017 initiatives 2016 initiatives 2014 & 2015 initiatives Total Balance, December 31, 2015 $ — $ — $ — $ 3,864 $ 3,864 Charges — — 7,198 78 7,276 Reversals — — (281 ) (583 ) (864 ) Payments — — (2,816 ) (3,279 ) (6,095 ) Balance, December 31, 2016 — — 4,101 80 4,181 Charges — 7,222 603 41 7,866 Reversals — (161 ) (464 ) (42 ) (667 ) Payments — (2,713 ) (4,208 ) (79 ) (7,000 ) Balance, December 31, 2017 — 4,348 32 — 4,380 Charges 8,136 133 — — 8,269 Reversals (1,412 ) (552 ) (5 ) — (1,969 ) Payments (3,276 ) (3,916 ) (27 ) — (7,219 ) Balance, December 31, 2018 $ 3,448 $ 13 $ — $ — $ 3,461 Cumulative amounts: Charges $ 8,136 $ 7,355 $ 7,801 $ 14,488 $ 37,780 Reversals (1,412 ) (713 ) (750 ) (2,416 ) (5,291 ) Payments (3,276 ) (6,629 ) (7,051 ) (12,072 ) (29,028 ) Balance, December 31, 2018 $ 3,448 $ 13 $ — $ — $ 3,461 The components of our restructuring and integration accruals, by segment, were as follows: Employee severance benefits Operating lease obligations (in thousands) Small Business Services Financial Services Direct Checks Corporate (1) Small Business Services Financial Services Total Balance, December 31, 2015 $ 1,023 $ 884 $ — $ 1,859 $ 56 $ 42 $ 3,864 Charges 2,634 1,937 143 2,503 59 — 7,276 Reversals (369 ) (64 ) (2 ) (429 ) — — (864 ) Payments (2,105 ) (1,416 ) (134 ) (2,283 ) (115 ) (42 ) (6,095 ) Balance, December 31, 2016 1,183 1,341 7 1,650 — — 4,181 Charges 2,032 2,168 143 3,500 23 — 7,866 Reversals (214 ) (93 ) (4 ) (356 ) — — (667 ) Payments (2,212 ) (2,018 ) (6 ) (2,745 ) (19 ) — (7,000 ) Balance, December 31, 2017 789 1,398 140 2,049 4 — 4,380 Charges 2,682 4,148 — 842 306 291 8,269 Reversals (530 ) (1,200 ) (5 ) (163 ) — (71 ) (1,969 ) Payments (1,615 ) (2,949 ) (135 ) (2,272 ) (28 ) (220 ) (7,219 ) Balance, December 31, 2018 $ 1,326 $ 1,397 $ — $ 456 $ 282 $ — $ 3,461 Cumulative amounts (2) : Charges $ 13,073 $ 12,512 $ 322 $ 10,856 $ 673 $ 344 $ 37,780 Reversals (2,313 ) (1,668 ) (13 ) (1,226 ) — (71 ) (5,291 ) Inter-segment transfer 41 (14 ) — (27 ) — — — Payments (9,475 ) (9,433 ) (309 ) (9,147 ) (391 ) (273 ) (29,028 ) Balance, December 31, 2018 $ 1,326 $ 1,397 $ — $ 456 $ 282 $ — $ 3,461 (1) As discussed in Note 18, corporate costs are allocated to our business segments. As such, the net corporate charges are reflected in the business segment operating income presented in Note 18 in accordance with our allocation methodology. (2) |
CEO transition costs
CEO transition costs | 12 Months Ended |
Dec. 31, 2018 | |
CEO transition costs [Abstract] | |
CEO transition costs [Text Block] | Chief Executive Officer transition costs In April 2018, we announced the retirement of Lee Schram, our former Chief Executive Officer (CEO). Mr. Schram will remain employed under the terms of a transition agreement through March 1, 2019. Under the terms of the transition agreement, if Mr. Schram remains employed through March 1, 2019, assists with the CEO transition, and complies with certain covenants, we will provide to Mr. Schram certain benefits, including a transition bonus in the amount of $2,000 , accelerated vesting of certain restricted stock unit awards and continued vesting and settlement of a pro-rata portion of outstanding performance share awards to the extent such awards were earned based on the attainment of performance goals. The modifications to Mr. Schram's share-based payment awards resulted in expense of $2,088 , which is being recognized through the first quarter of 2019. In conjunction with the CEO transition, we also offered retention agreements to certain members of our management team under which each employee will be entitled to receive a cash bonus equal to his or her annual base salary or up to 1.5 times his or her annual base salary if he or she remains employed during the retention period, generally from July 1, 2018 to December 31, 2019, and complies with certain covenants. The retention bonus will be paid to an employee if his or her employment is terminated without cause before the end of the retention period. In addition, we incurred certain other costs related to the CEO transition process, such as executive search, legal, travel and board of directors fees. CEO transition costs are included in SG&A expense and were $7,210 for the year ended December 31, 2018 , including the impact of modifications to Mr. Schram’s share-based payment awards. Accruals for CEO transition costs were $1,972 within accrued liabilities and $1,808 |
Income tax provision
Income tax provision | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income tax provision | Income tax provision Income before income taxes was comprised of the following for the years ended December 31: (in thousands) 2018 2017 2016 United States $ 198,727 $ 299,424 $ 325,396 Foreign 13,904 13,403 14,990 Income before income taxes $ 212,631 $ 312,827 $ 340,386 The components of the income tax provision were as follows for the years ended December 31: (in thousands) 2018 2017 2016 Current tax provision: Federal $ 57,117 $ 104,079 $ 93,261 State 11,319 12,996 12,006 Foreign 5,921 4,774 3,851 Total current tax provision 74,357 121,849 109,118 Deferred tax provision: Federal (7,220 ) (37,471 ) 1,752 State (1,701 ) (491 ) 462 Foreign (2,435 ) (1,215 ) (328 ) Total deferred tax provision (11,356 ) (39,177 ) 1,886 Income tax provision $ 63,001 $ 82,672 $ 111,004 The effective tax rate on pre-tax income reconciles to the United States federal statutory tax rate for the years ended December 31 as follows: 2018 2017 2016 Income tax at federal statutory rate 21.0 % 35.0 % 35.0 % Goodwill impairment charge 7.1 % 1.5 % — State income tax expense, net of federal income tax benefit 3.0 % 2.7 % 2.4 % Impact of Tax Cuts and Jobs Act (0.8 %) (6.6 %) — Qualified production activities deduction — (3.2 %) (2.8 %) Net tax benefit of share-based compensation (0.8 %) (1.6 %) (1.2 %) Other 0.1 % (1.4 %) (0.8 %) Effective tax rate 29.6 % 26.4 % 32.6 % In December 2017, United States tax reform was signed into law as the Tax Cuts and Jobs Act (the 2017 Tax Act). This legislation included a broad range of tax reforms, including changes to corporate tax rates, business deductions and international tax provisions. The tax effects of changes in tax laws or rates must be recognized in the period in which the law is enacted. As such, this legislation resulted in a net benefit of approximately $20,500 to our 2017 income tax provision. This amount included the net tax benefit from the remeasurement of deferred income taxes to the new federal statutory tax rate of 21% , which was effective for us on January 1, 2018, and revised state income tax rates for those states we expected to follow the provisions of the 2017 Tax Act, partially offset by the establishment of a liability for repatriation toll charges related to undistributed foreign earnings and profits. During 2017, reasonable estimates were used to determine certain impacts of the 2017 Tax Act, including our 2017 deferred activity and the amount of post-1986 foreign deferred earnings subject to the repatriation toll charge. We finalized our accounting for the 2017 Tax Act during the fourth quarter of 2018. Our income tax provision for the year ended December 31, 2018 was reduced $1,700 for adjustments to our accounting for the 2017 Tax Act, primarily a reduction in the amount accrued for the repatriation toll charge. A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding accrued interest and penalties and the federal benefit of deductible state income tax, is as follows: (in thousands) 2018 2017 2016 Balance, beginning of year $ 3,795 $ 7,373 $ 5,743 Additions for tax positions of current year 315 378 521 Additions for tax positions of prior years 1,177 659 1,428 Reductions for tax positions of prior years (108 ) (4,389 ) (177 ) Lapse of statutes of limitations (378 ) (226 ) (142 ) Balance, end of year $ 4,801 $ 3,795 $ 7,373 If the unrecognized tax benefits as of December 31, 2018 were recognized in our consolidated financial statements, income tax expense would decrease $4,801 . Accruals for interest and penalties, excluding the tax benefits of deductible interest, were $1,156 as of December 31, 2018 and $1,046 as of December 31, 2017 . Our income tax provision included expense for interest and penalties of $110 in 2018 and $179 in 2016 and included a reduction for interest and penalties of $284 in 2017 . Within the next 12 months, it is reasonably possible that our unrecognized tax benefits will change in the range of a decrease of $3,200 to an increase of $1,800 as we attempt to resolve certain federal and state tax matters or as federal and state statutes of limitations expire. Due to the nature of the underlying liabilities and the extended time frame often needed to resolve income tax uncertainties, we cannot provide reliable estimates of the amount or timing of cash payments that may be required to settle these liabilities. The statute of limitations for federal tax assessments for 2014 and prior years has expired. Audits of our federal income tax returns through 2015 have been completed by the Internal Revenue Service (IRS). Our 2016 and 2017 returns and our 2018 return, when filed, are subject to IRS examination. In general, income tax returns for the years 2014 through 2018 remain subject to examination by foreign, state and city tax jurisdictions. In the event that we have determined not to file income tax returns with a particular state or city, all years remain subject to examination by the tax jurisdiction. The ultimate outcome of tax matters may differ from our estimates and assumptions. Unfavorable settlement of any particular issue would require the use of cash and could result in increased income tax expense. Favorable resolution would result in reduced income tax expense. Tax-effected temporary differences that gave rise to deferred tax assets and liabilities as of December 31 were as follows: 2018 2017 (in thousands) Deferred tax assets Deferred tax liabilities Deferred tax assets Deferred tax liabilities Goodwill $ — $ 47,993 $ — $ 45,317 Intangible assets — 3,780 — 7,490 Prepaid assets — 3,469 — 3,137 Installment sales treatment of notes receivable — 3,054 — 2,450 Deferred advertising costs — 1,948 — 1,920 Property, plant and equipment — 1,739 — 8,122 Net operating loss, capital loss and tax credit carryforwards 9,380 — 11,802 — Reserves and accruals 8,893 — 6,151 — Inventories 2,043 — 2,110 — All other 4,657 5,095 3,895 3,119 Total deferred taxes 24,973 67,078 23,958 71,555 Valuation allowances (1,689 ) — (1,518 ) — Net deferred taxes $ 23,284 $ 67,078 $ 22,440 $ 71,555 The valuation allowances as of December 31, 2018 and December 31, 2017 related primarily to capital loss carryforwards in Canada and net operating loss carryforwards in various state jurisdictions that we do not currently expect to fully realize. The provision for income taxes included benefits of $290 for 2018 , $1,015 for 2017 and $302 for 2016 related to changes in the valuation allowances. The remainder of the change in the valuation allowances was attributable to foreign currency translation. As of December 31, 2018 , deferred income taxes have not been recognized on unremitted earnings of our foreign subsidiaries, as these amounts are intended to be reinvested indefinitely in the operations of those subsidiaries. If we were to repatriate all of our foreign cash and cash equivalents into the United States at one time, the tax effects would generally be limited to foreign withholding taxes on any distributions. As of December 31, 2018 , the amount of cash and cash equivalents held by our foreign subsidiaries was $51,310 , primarily in Canada. As of December 31, 2018 , we had the following net operating loss, capital loss and tax credit carryforwards: • state net operating loss carryforwards and tax credit carryforwards of $56,713 that expire at various dates up to 2038, • foreign capital loss and net operating loss carryforwards of $6,733 that do not expire, • foreign research tax credit and net operating loss carryforwards of $6,238 that expire at various dates up to 2037, and • federal net operating loss and capital loss carryforwards of $1,708 |
Share-based compensation plans
Share-based compensation plans | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation [Abstract] | |
Share-based compensation plans | Share-based compensation plans Our employee share-based compensation plans consist of our employee stock purchase plan and our long-term incentive plan. Effective May 2, 2017, our shareholders approved the Deluxe Corporation 2017 Long-Term Incentive Plan, simultaneously terminating our previous plan. Under this plan, 5.0 million shares of common stock plus any shares released as a result of the forfeiture or termination of awards issued under our prior plan are reserved for issuance, with 5.4 million shares remaining available for issuance as of December 31, 2018 . Full value awards such as restricted stock, restricted stock units and performance share awards reduce the number of shares available for issuance by a factor of 2.23 , or if such an award were forfeited or terminated without delivery of the shares, the number of shares that again become eligible for issuance would be multiplied by a factor of 2.23 . Under our current and previous plans, we have granted non-qualified stock options, restricted stock units, restricted shares and performance share awards. Our current plan also allows for the issuance of stock appreciation rights, which we have not granted as of December 31, 2018 . Our policies regarding the recognition of compensation expense for employee share-based awards can be found in Note 1. The following amounts were recognized in our consolidated statements of income for share-based compensation awards for the years ended December 31: (in thousands) 2018 2017 2016 Restricted shares and restricted stock units $ 5,232 $ 6,533 $ 5,786 Performance share awards 4,502 4,782 2,806 Stock options 3,143 3,270 3,401 Employee stock purchase plan 501 524 466 Total share-based compensation expense $ 13,378 $ 15,109 $ 12,459 Income tax benefit $ (3,946 ) $ (5,152 ) $ (4,063 ) As of December 31, 2018 , the total compensation expense for unvested awards not yet recognized in our consolidated statements of income was $16,683 , net of the effect of estimated forfeitures. This amount is expected to be recognized over a weighted-average period of 2.1 years. Non-qualified stock options – All options allow for the purchase of shares of common stock at prices equal to the stock's market value at the date of grant. Options become exercisable beginning 1 year after the grant date, with one-third vesting each year over 3 years. Options may be exercised up to 7 years following the date of grant. Beginning 1 year after the grant date, in the case of qualified retirement, death or disability, options vest immediately and the period over which the options can be exercised is shortened. Beginning 1 year after the grant date, in the case of involuntary termination without cause, a pro-rata portion of the options vest immediately and the period over which the options can be exercised is shortened. Employees forfeit unvested options when they voluntarily terminate their employment with the company, and they have up to 3 months to exercise vested options before they are canceled. In the case of involuntary termination with cause, the entire unexercised portion of the award is canceled. All options may vest immediately upon a change of control, as defined in the award agreement. The following weighted-average assumptions were used in the Black-Scholes option pricing model in determining the fair value of stock options granted: 2018 2017 2016 Risk-free interest rate 2.7 % 1.6 % 1.1 % Dividend yield 2.0 % 1.6 % 2.2 % Expected volatility 23.0 % 23.7 % 25.5 % Weighted-average option life (in years) 3.9 3.7 4.0 The risk-free interest rate for periods within the expected option life is based on the United States Treasury yield curve in effect at the grant date. The dividend yield is estimated over the expected life of the option based on historical dividends paid. Expected volatility is based on the historical volatility of our stock over the most recent historical period equivalent to the expected life of the option. The expected life is the average length of time over which we expect the employee groups will exercise their options, based on historical experience with similar grants. Each option is convertible into 1 share of common stock upon exercise. Information regarding options issued under the current and all previous plans was as follows: Number of options (in thousands) Weighted-average exercise price per option Aggregate intrinsic value (in thousands) Weighted-average remaining contractual term (in years) Outstanding, December 31, 2015 1,354 $ 40.11 Granted 458 54.44 Exercised (476 ) 30.80 Forfeited or expired (85 ) 58.06 Outstanding, December 31, 2016 1,251 47.68 Granted 270 75.30 Exercised (347 ) 38.72 Forfeited or expired (35 ) 62.19 Outstanding, December 31, 2017 1,139 56.51 Granted 519 62.12 Exercised (339 ) 42.55 Forfeited or expired (74 ) 66.85 Outstanding, December 31, 2018 1,245 62.04 $ 127 5.0 Exercisable at December 31, 2016 624 $ 38.50 Exercisable at December 31, 2017 555 47.42 Exercisable at December 31, 2018 472 59.90 $ 127 3.5 The weighted-average grant-date fair value of options granted was $10.98 per option for 2018 , $12.81 per option for 2017 and $9.16 per option for 2016 . The intrinsic value of a stock award is the amount by which the fair value of the underlying stock exceeds the exercise price of the award. The total intrinsic value of options exercised was $10,007 for 2018 , $11,699 for 2017 and $16,043 for 2016 . Restricted stock units – Certain management employees have the option to receive a portion of their bonus payment in the form of restricted stock units. When employees elect this payment method, we provide an additional matching amount of restricted stock units equal to 50% of the restricted stock units earned under the bonus plan. These awards vest 2 years from the date of grant. In the case of qualified retirement, death, disability or change of control, the units vest immediately. In the case of involuntary termination without cause or voluntary termination, employees receive a cash payment for the units earned under the bonus plan, but forfeit the company-provided matching amount. In addition to awards granted to employees, non-employee members of our board of directors can elect to receive all or a portion of their fees in the form of restricted stock units. Directors are issued shares in exchange for the units upon the earlier of the tenth anniversary of February 1 st of the year following the year in which the non-employee director ceases to serve on the board or such other objectively determinable date pre-elected by the director. Each restricted stock unit is convertible into 1 share of common stock upon completion of the vesting period. Information regarding our restricted stock units was as follows: Number of units (in thousands) Weighted-average grant date fair value per unit Weighted-average remaining contractual term (in years) Outstanding at December 31, 2015 167 $ 34.74 Granted 38 55.39 Vested (46 ) 40.15 Forfeited (20 ) 58.69 Outstanding at December 31, 2016 139 37.99 Granted 16 73.27 Vested (43 ) 43.18 Forfeited (3 ) 57.18 Outstanding at December 31, 2017 109 38.31 Granted 110 52.32 Vested (22 ) 48.14 Forfeited (2 ) 74.96 Outstanding at December 31, 2018 195 45.41 3.3 Of the awards outstanding as of December 31, 2018 , 14 thousand restricted stock units with a value of $546 were included in accrued liabilities and other non-current liabilities in our consolidated balance sheet. As of December 31, 2018 , these units had a fair value of $38.44 per unit and a weighted-average remaining contractual term of 7 months. The total fair value of restricted stock units that vested was $1,619 for 2018 , $3,161 for 2017 and $2,805 for 2016 . We made cash payments of $78 during 2018 , $421 during 2017 and $140 during 2016 to settle share-based liabilities. Restricted shares – For restricted share awards granted to employees under our current long-term incentive plan, one-third of the shares vest each year over 3 years. Such awards granted under our previous plan vest in their entirety at the end of the 3 year vesting period. Restricted shares granted to directors typically have a 1 year vesting period. The restrictions lapse immediately in the case of qualified retirement, death or disability, or in the event of a change in control where replacement securities are not awarded. In the case of involuntary termination without cause, restrictions on a pro-rata portion of the shares lapse based on how much of the vesting period has passed. In the case of voluntary termination of employment or termination with cause, the unvested restricted shares are forfeited. Information regarding unvested restricted shares was as follows: Number of shares (in thousands) Weighted-average grant date fair value per share Weighted-average remaining contractual term (in years) Unvested at December 31, 2015 170 $ 56.35 Granted 97 56.22 Vested (22 ) 56.63 Forfeited (25 ) 56.86 Unvested at December 31, 2016 220 56.43 Granted 68 74.84 Vested (99 ) 52.41 Forfeited (8 ) 61.37 Unvested at December 31, 2017 181 65.33 Granted 77 71.29 Vested (76 ) 69.73 Forfeited (14 ) 66.24 Unvested at December 31, 2018 168 66.02 1.1 The total fair value of restricted shares that vested was $5,375 for 2018 , $7,452 for 2017 and $1,398 for 2016 . Performance share awards – Our performance share awards have a 3 -year vesting period. Shares will be issued at the end of the vesting period if performance targets relating to revenue and total shareholder return are achieved. If employment is terminated for any reason prior to the 1 -year anniversary of the commencement of the performance period, the award is forfeited. On or after the 1 -year anniversary of the commencement of the performance period, a pro-rata portion of the shares awarded at the end of the performance period would be issued in the case of qualified retirement, death, disability, involuntary termination without cause or resignation for good reason, as defined in the agreement. The following weighted-average assumptions were used in the Monte Carlo simulation model in determining the fair value of market-based performance shares granted: 2018 2017 2016 Risk-free interest rate 2.4 % 1.4 % 0.9 % Dividend yield 1.6 % 1.7 % 2.3 % Expected volatility 21.6 % 21.9 % 22.7 % The risk-free interest rate for periods within the expected award life is based on the United States Treasury yield curve in effect at the grant date. The dividend yield is estimated over the expected life of the award based on historical dividends paid. Expected volatility is based on the historical volatility of our stock. Information regarding unvested performance shares was as follows: Performance shares (in thousands) Weighted-average grant date fair value per share Weighted-average remaining contractual term (in years) Unvested at December 31, 2015 122 $ 58.13 Granted (1) 153 52.75 Forfeited (39 ) 55.04 Unvested at December 31, 2016 236 55.15 Granted (1) 83 75.31 Forfeited (9 ) 64.85 Vested (60 ) 50.17 Adjustment for performance results achieved (2) 5 50.34 Unvested at December 31, 2017 255 63.42 Granted (1) 91 74.49 Forfeited (48 ) 59.32 Vested (45 ) 67.10 Adjustment for performance results achieved (2) (3 ) 67.11 Unvested at December 31, 2018 250 67.54 1.1 (1) Reflects awards granted assuming achievement of performance goals at target. (2) Reflects the difference between the awards earned at the end of the performance period and the target number of shares. Employee stock purchase plan – During 2018 , 53 thousand shares were issued under this plan at prices of $63.13 and $50.09 . During 2017 , 46 thousand shares were issued under this plan at prices of $61.92 and $61.37 . During 2016 , 48 thousand shares were issued under this plan at prices of $47.52 and $57.45 |
Employee compensation plans
Employee compensation plans | 12 Months Ended |
Dec. 31, 2018 | |
Compensation Related Costs [Abstract] | |
Employee compensation plans | Employee compensation plans Profit sharing/401(k) plan – We maintain a profit sharing/401(k) plan to provide retirement benefits for certain employees. The plan covers a majority of our full-time employees, as well as some part-time employees. Employees are eligible to participate in the plan on the first day of the quarter following their first full year of service. Profit sharing contributions are made solely by Deluxe and are remitted to the plan's trustee. These contributions vary based on the company's performance. 401(k) contributions are made by both employees and Deluxe. Employees may contribute up to 50% of eligible wages, subject to IRS limitations and the terms and conditions of the plan. For the majority of employees, we match 100% of the first 1% of wages contributed and 50% of the next 5% of wages contributed, beginning on the first day of the quarter following an employee's first full year of service. All employee and employer contributions are remitted to the plan's trustee. Benefits provided by the plan are paid from accumulated funds of the trust. Employees are provided a broad range of investment options to choose from when investing their profit sharing/401(k) plan funds. Investing in our common stock is not one of these options, although funds selected by employees may at times hold our common stock. Cash bonus programs – We provide short-term cash bonus programs under which employees may receive cash bonus payments based on our performance for a given fiscal year. Payments earned are paid directly to employees shortly after the end of the year. Expense recognized in the consolidated statements of income for these plans was as follows for the years ended December 31: (in thousands) 2018 2017 2016 Performance-based compensation plans (1) $ 20,297 $ 22,085 $ 19,730 401(k) expense 9,686 9,023 8,309 (1) Excludes expense for share-based compensation, which is discussed in Note 12. Deferred compensation plan – We have a non-qualified deferred compensation plan that allows eligible employees to defer a portion of their compensation. Participants can elect to defer up to 100% of their base salary plus up to 50% of their bonus for the year. The compensation deferred under this plan is credited with earnings or losses measured by the mirrored rate of return on phantom investments elected by plan participants, which are similar to the investments available for funds invested under our profit sharing/401(k) plan. Each participant is fully vested in all deferred compensation and earnings. A participant may elect to receive deferred amounts in a lump-sum payment or in monthly installments upon termination of employment or disability. Our total liability under this plan was $4,458 as of December 31, 2018 and $4,581 as of December 31, 2017 . These amounts are reflected in accrued liabilities and other non-current liabilities in the consolidated balance sheets. We hold investments in an irrevocable rabbi trust for our deferred compensation plan. These assets consist of investments in company-owned life insurance policies, which are included in long-term investments in the consolidated balance sheets, and totaled $10,831 as of December 31, 2018 and $11,648 as of December 31, 2017 |
Postretirement benefits
Postretirement benefits | 12 Months Ended |
Dec. 31, 2018 | |
Defined Benefit Plan [Abstract] | |
Postretirement benefits | Postretirement benefits We have historically provided certain health care benefits for a large number of retired United States employees. Employees hired prior to January 1, 2002 become eligible for benefits if they attain the appropriate years of service and age prior to retirement. Employees hired on January 1, 2002 or later are not eligible to participate in our retiree health care plan. In addition to our retiree health care plan, we also have a supplemental executive retirement plan (SERP) in the United States. The SERP is no longer an active plan. It is not adding new participants and all of the current participants are retired. The SERP has no plan assets, but our obligation is fully funded by investments in company-owned life insurance policies. Obligations and funded status – The following tables summarize the change in benefit obligation, plan assets and funded status during 2018 and 2017 : (in thousands) Postretirement benefit plan Pension plan (1) Change in benefit obligation: Benefit obligation, December 31, 2016 $ 94,188 $ 3,447 Interest cost 2,794 101 Net actuarial (gain) loss (1,469 ) 174 Benefits paid from plan assets and company funds (7,919 ) (324 ) Benefit obligation, December 31, 2017 87,594 3,398 Interest cost 2,529 97 Net actuarial gain (9,231 ) (23 ) Benefits paid from plan assets and company funds (7,175 ) (324 ) Benefit obligation, December 31, 2018 $ 73,717 $ 3,148 Change in plan assets: Fair value of plan assets, December 31, 2016 $ 118,128 $ — Return on plan assets 15,309 — Benefits paid (5,994 ) — Fair value of plan assets, December 31, 2017 127,443 — Return on plan assets (6,663 ) — Benefits paid (5,804 ) — Fair value of plan assets, December 31, 2018 $ 114,976 $ — Funded status, December 31, 2017 $ 39,849 $ (3,398 ) Funded status, December 31, 2018 $ 41,259 $ (3,148 ) (1) The accumulated benefit obligation equals the projected benefit obligation. The funded status of our plans was recognized in the consolidated balance sheets as of December 31 as follows: Postretirement benefit plan Pension plan (in thousands) 2018 2017 2018 2017 Other non-current assets $ 41,259 $ 39,849 $ — $ — Accrued liabilities — — 324 324 Other non-current liabilities — — 2,824 3,074 Amounts included in accumulated other comprehensive loss as of December 31 that have not been recognized as components of postretirement benefit income were as follows: (in thousands) 2018 2017 Unrecognized prior service credit $ 14,178 $ 15,599 Unrecognized net actuarial loss (57,436 ) (55,174 ) Tax effect 6,729 12,746 Amount recognized in accumulated other comprehensive loss, net of tax $ (36,529 ) $ (26,829 ) The unrecognized prior service credit relates to our postretirement benefit plan and is a result of previous plan amendments that reduced the accumulated postretirement benefit obligation. A reduction is first used to reduce any existing unrecognized prior service cost, then to reduce any remaining unrecognized transition obligation. The excess is the unrecognized prior service credit. The prior service credit is being amortized on the straight-line basis over a weighted-average period of 21 years . The amortization period for the prior service credit is the average remaining life expectancy of plan participants at the time of the plan amendment. Unrecognized net actuarial gains and losses result from experience different from that assumed and from changes in assumptions. The net actuarial gain generated during 2018 was primarily due to favorable claims experience and an increase in the discount rate used to discount the benefit obligation. The net actuarial gain generated during 2017 was primarily due to favorable claims experience, partially offset by a decrease in the discount rate used to discount the benefit obligation. Unrecognized actuarial gains and losses for our postretirement benefit plan are being amortized over the average remaining life expectancy of inactive plan participants, as a large percentage of the plan participants are classified as inactive. This amortization period is currently 14.3 years . Postretirement benefit income – Postretirement benefit income for the years ended December 31 consisted of the following components: (in thousands) 2018 2017 2016 Interest cost $ 2,626 $ 2,896 $ 3,118 Expected return on plan assets (7,737 ) (7,128 ) (7,335 ) Amortization of prior service credit (1,421 ) (1,421 ) (1,421 ) Amortization of net actuarial losses 2,884 3,637 3,797 Net periodic benefit income $ (3,648 ) $ (2,016 ) $ (1,841 ) Actuarial assumptions – In measuring benefit obligations as of December 31, the following discount rate assumptions were used: Postretirement benefit plan Pension plan 2018 2017 2018 2017 Discount rate 4.13 % 3.46 % 4.01 % 3.35 % In measuring net periodic benefit income for the years ended December 31, the following assumptions were used: Postretirement benefit plan Pension plan 2018 2017 2016 2018 2017 2016 Discount rate 3.46 % 3.81 % 4.02 % 3.35 % 3.66 % 3.88 % Expected return on plan assets 6.25 % 6.25 % 6.50 % — — — The discount rate assumption is based on the rates of return on high-quality, fixed-income instruments currently available whose cash flows approximate the timing and amount of expected benefit payments. Effective December 31, 2015, we changed the method we use to determine the discount rate used in calculating the interest component of net periodic benefit income. Instead of using a single weighted-average discount rate, we elected to utilize a full yield curve approach by applying separate discount rates to each future projected benefit payment based on time until payment. We made this change to provide a more precise measurement of interest costs by improving the correlation between projected cash flows and the corresponding yield curve rates. This change did not affect the measurement of our total benefit obligation, but it reduced the interest component of net periodic benefit income by $881 in 2016. This is a change in accounting estimate, and accordingly, we accounted for it on a prospective basis. In determining the expected long-term rate of return on plan assets, we utilize our historical returns and then adjust these returns for estimated inflation and projected market returns. Our inflation assumption is primarily based on analysis of historical inflation data. In measuring benefit obligations as of December 31 for our postretirement benefit plan, the following assumptions for health care cost trend rates were used: 2018 2017 2016 Participants under age 65 Participants age 65 and older Participants under age 65 Participants age 65 and older Participants under age 65 Participants age 65 and older Health care cost trend rate assumed for next year 7.70 % 8.70 % 7.90 % 9.10 % 7.50 % 8.75 % Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) 4.50 % 4.50 % 4.50 % 4.50 % 4.50 % 4.50 % Year that the rate reaches the ultimate trend rate 2029 2029 2025 2025 2025 2025 Plan assets – The allocation of plan assets by asset category as of December 31 was as follows: Postretirement benefit plan 2018 2017 Mortgage-backed securities 25 % 23 % U.S. large capitalization equity securities 23 % 24 % U.S. corporate debt securities 20 % 18 % International equity securities 18 % 18 % Government debt securities 11 % 13 % U.S. small and mid-capitalization equity securities 3 % 4 % Total 100 % 100 % Our postretirement benefit plan has assets that are intended to meet long-term obligations. In order to meet these obligations, we employ a total return investment approach that considers cash flow needs and balances long-term projected returns against expected asset risk, as measured using projected standard deviations. Risk tolerance is established through consideration of projected plan liabilities, the plan's funded status, projected liquidity needs and current corporate financial condition. The target asset allocation percentages for our postretirement benefit plan are based on our liability and asset projections. The targeted allocation of plan assets is 55% fixed income securities, 24% large capitalization equity securities, 18% international equity securities and 3% small and mid-capitalization equity securities. Information regarding fair value measurements of plan assets was as follows as of December 31, 2018 : Fair value measurements using Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Investments measured at net asset value Fair value as of December 31, 2018 (in thousands) (Level 1) (Level 2) (Level 3) Mortgage-backed securities $ — $ 13,593 $ — $ 15,138 $ 28,731 U.S. large capitalization equity securities — — — 26,240 26,240 U.S. corporate debt securities 6,489 12,468 — 3,594 22,551 International equity securities 20,261 298 — — 20,559 Government debt securities — 12,738 — — 12,738 U.S. small and mid-capitalization equity securities 3,259 27 — 551 3,837 Other debt securities (6 ) 326 — — 320 Plan assets $ 30,003 $ 39,450 $ — $ 45,523 $ 114,976 Information regarding fair value measurements of plan assets was as follows as of December 31, 2017 : Fair value measurements using Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Investments measured at net asset value Fair value as of December 31, 2017 (in thousands) (Level 1) (Level 2) (Level 3) Mortgage-backed securities $ — $ 13,274 $ — $ 15,388 $ 28,662 U.S. large capitalization equity securities — — — 30,167 30,167 U.S. corporate debt securities — 13,032 — 10,206 23,238 International equity securities 23,127 340 — — 23,467 Government debt securities — 17,118 — — 17,118 U.S. small and mid-capitalization equity securities 3,490 56 — 956 4,502 Other debt securities 134 155 — — 289 Plan assets $ 26,751 $ 43,975 $ — $ 56,717 $ 127,443 The fair value of Level 2 mortgage-backed securities is estimated using pricing models with inputs derived principally from observable market data. The fair value of our other Level 2 debt securities is typically estimated using pricing models, quoted prices of securities with similar characteristics or discounted cash flow calculations that maximize observable inputs, such as current yields for similar instruments adjusted for trades and other pertinent market information. Our policy is to recognize transfers between fair value levels as of the end of the reporting period in which the transfer occurred. Cash flows – We made no contributions to plan assets during the past 3 years. We have fully funded the United States SERP obligation with investments in company-owned life insurance policies. The cash surrender value of these policies is included in long-term investments in the consolidated balance sheets and totaled $6,869 as of December 31, 2018 and $6,615 as of December 31, 2017 . The following benefit payments are expected to be paid during the years indicated: (in thousands) Postretirement benefit plan Pension plan 2019 $ 7,679 $ 320 2020 7,906 320 2021 7,730 310 2022 7,219 300 2023 6,686 300 2024 - 2028 26,205 1,320 |
Debt and lease obligations
Debt and lease obligations | 12 Months Ended |
Dec. 31, 2018 | |
Debt and lease obligations [Abstract] | |
Debt and lease obligations | Debt and lease obligations Debt outstanding was comprised of the following at December 31: (in thousands) 2018 2017 Amount drawn on revolving credit facility $ 910,000 $ 413,000 Amount outstanding under term loan facility — 294,938 Capital lease obligations 1,864 1,914 Long-term debt, principal amount 911,864 709,852 Less unamortized debt issuance costs — (471 ) Less current portion of long-term debt (791 ) (44,121 ) Long-term debt 911,073 665,260 Current portion of amount drawn under term loan facility — 43,313 Current portion of capital lease obligations 791 808 Long-term debt due within one year, principal amount 791 44,121 Less unamortized debt issuance costs — (81 ) Long-term debt due within one year 791 44,040 Total debt $ 911,864 $ 709,300 There are currently no limitations on the amount of dividends and share repurchases under the terms of our credit agreement. However, if our leverage ratio, defined as total debt less unrestricted cash to EBITDA, should exceed 2.75 to 1, there would be an annual limitation on the amount of dividends and share repurchases. Senior notes – In November 2012, we issued $200,000 of 6.0% senior notes that were scheduled to mature on November 15, 2020 . The notes were issued via a private placement under Rule 144A of the Securities Act of 1933 and were subsequently registered with the SEC via a registration statement that became effective on April 3, 2013. In November 2016, we retired all of these notes, realizing a loss on early debt extinguishment of $7,858 during 2016, consisting of a contractual call premium and the write-off of related debt issuance costs. This retirement was funded utilizing a new term loan facility established under our credit facility agreement. As discussed in Note 7, we entered into interest rate swaps to hedge these notes. The swaps were terminated in November 2016 at the time of the debt redemption. The cumulative decrease in the fair value of hedged debt as of the date of the termination of $2,842 was recorded as interest expense in the 2016 consolidated statement of income. Credit facility – In March 2018, we entered into a revolving credit facility in the amount of $950,000 , subject to increase under the credit agreement to an aggregate amount not exceeding $1,425,000 . The credit facility matures in March 2023. Our previous credit facility agreement was terminated contemporaneously with our entry into the new credit facility and was repaid utilizing proceeds from the new credit facility. Our quarterly commitment fee ranges from 0.175% to 0.35% based on our leverage ratio. As of December 31, 2018 , $910,000 was drawn on our revolving credit facility at a weighted-average interest rate of 3.79% . As of December 31, 2017 , $413,000 was drawn on our previous revolving credit facility at a weighted-average interest rate of 2.98% . Our previous credit facility agreement also included a $330,000 variable rate term loan facility, the proceeds from which were used to retire our senior notes due in 2020 and to partially fund the acquisition of FMCG in December 2016 (Note 6). As of December 31, 2017 , $294,938 was outstanding under the term loan facility at a weighted-average interest rate of 2.99% . This amount was repaid in March 2018, utilizing proceeds from the new revolving credit facility. Borrowings under the credit agreement are collateralized by substantially all of our personal and intangible property. The credit agreement governing our credit facility contains customary covenants regarding limits on levels of subsidiary indebtedness and capital expenditures, liens, investments, acquisitions, certain mergers, certain asset sales outside the ordinary course of business, and change in control as defined in the agreement. The agreement also requires us to maintain certain financial ratios, including a maximum leverage ratio of 3.5 and a minimum ratio of consolidated earnings before interest and taxes to consolidated interest expense, as defined in the credit agreement, of 3.0 . Daily average amounts outstanding under our credit facility were as follows for the years ended December 31: (in thousands) 2018 2017 2016 Revolving credit facility: Daily average amount outstanding $ 731,110 $ 436,588 $ 417,219 Weighted-average interest rate 3.24 % 2.55 % 1.93 % Term loan facility: Daily average amount outstanding $ 63,638 $ 315,862 $ 52,381 Weighted-average interest rate 2.97 % 2.57 % 1.52 % As of December 31, 2018 , amounts were available for borrowing under our revolving credit facility as follows: (in thousands) Total available Revolving credit facility commitment (1) $ 950,000 Amount drawn on revolving credit facility (910,000 ) Outstanding letters of credit (2) (10,221 ) Net available for borrowing as of December 31, 2018 $ 29,779 (1) In January 2019, we increased the credit facility by $200,000 , bringing the total availability to $1,150,000 . (2) We use standby letters of credit primarily to collateralize certain obligations related to our self-insured workers' compensation claims, as well as claims for environmental matters, as required by certain states. These letters of credit reduce the amount available for borrowing under our revolving credit facility. Lease obligations – We had capital lease obligations of $1,864 as of December 31, 2018 and $1,914 as of December 31, 2017 related to information technology hardware. The lease obligations will be paid through October 2022 . The related assets are included in property, plant and equipment in the consolidated balance sheets. Depreciation of the leased assets is included in depreciation expense in the consolidated statements of cash flows. A portion of the leased assets have not yet been placed in service. The balance of those leased assets placed in service as of December 31 was as follows: (in thousands) 2018 2017 Machinery and equipment $ 6,413 $ 4,676 Accumulated depreciation (4,673 ) (3,522 ) Net assets under capital leases $ 1,740 $ 1,154 In addition to capital leases, we also have operating leases on certain facilities and equipment. Rental expense was $23,928 for 2018 , $19,839 for 2017 and $16,454 for 2016 . As of December 31, 2018 , future minimum lease payments under our capital lease obligations and noncancelable operating leases with terms in excess of one year were as follows: (in thousands) Capital lease obligations Operating lease obligations 2019 $ 822 $ 16,479 2020 637 13,240 2021 365 9,001 2022 91 5,792 2023 — 3,263 Thereafter — 11,056 Total minimum lease payments 1,915 $ 58,831 Less portion representing interest (51 ) Present value of minimum lease payments $ 1,864 |
Other commitments and contingen
Other commitments and contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Other commitments and contingencies | Other commitments and contingencies Indemnifications – In the normal course of business, we periodically enter into agreements that incorporate general indemnification language. These indemnification provisions generally encompass third-party claims arising from our products and services, including, without limitation, service failures, breach of security, intellectual property rights, governmental regulations and/or employment-related matters. Performance under these indemnities would generally be triggered by our breach of the terms of the contract. In disposing of assets or businesses, we often provide representations, warranties and/or indemnities to cover various risks including, for example, unknown damage to the assets, environmental risks involved in the sale of real estate, liability to investigate and remediate environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal matters related to periods prior to disposition. We do not have the ability to estimate the potential liability from such indemnities because they relate to unknown conditions. However, we do not believe that any liability under these indemnities would have a material adverse effect on our financial position, annual results of operations or annual cash flows. We have recorded liabilities for known indemnifications related to environmental matters. Environmental matters – We are currently involved in environmental compliance, investigation and remediation activities at some of our former sites, primarily printing facilities of our Financial Services and Small Business Services segments that have been sold. Remediation costs are accrued on an undiscounted basis when the obligations are either known or considered probable and can be reasonably estimated. Remediation or testing costs that result directly from the sale of an asset and which we would not have otherwise incurred are considered direct costs of the sale of the asset. As such, they are included in our measurement of the carrying value of the asset sold. Accruals for environmental matters were $2,755 as of December 31, 2018 and $2,646 as of December 31, 2017 . These accruals are included in accrued liabilities and other non-current liabilities in the consolidated balance sheets. Accrued costs consist of direct costs of the remediation activities, primarily fees that will be paid to outside engineering and consulting firms. Although recorded accruals include our best estimates, our total costs cannot be predicted with certainty due to various factors, such as the extent of corrective action that may be required, evolving environmental laws and regulations and advances in environmental technology. Where the available information is sufficient to estimate the amount of the liability, that estimate is used. Where the information is only sufficient to establish a range of probable liability and no point within the range is more likely than any other, the lower end of the range is recorded. We do not believe that the range of possible outcomes could have a material effect on our financial condition, results of operations or liquidity. Expense reflected in our consolidated statements of income for environmental matters was $750 for 2018 and $348 for 2017. The 2016 consolidated statement of income includes a net benefit from environmental matters of $1,692 . During the second quarter of 2016, we reversed a portion of the liability for one of our sold facilities as we determined that it was no longer probable that a portion of the estimated environmental remediation costs for this location would be incurred. We purchased an insurance policy during 2002 that covers up to $10,000 of third-party pollution claims through 2032 at certain owned, leased and divested sites. We also purchased an insurance policy during 2009 that covers up to $15,000 of third-party pollution claims through April 2019 at certain other sites. These policies cover liability for claims of bodily injury or property damage arising from pollution events at the covered facilities, as well as remediation coverage should we be required by a governing authority to perform remediation activities at the covered sites. No accruals have been recorded in our consolidated financial statements for any of the events contemplated in these insurance policies. We do not anticipate significant net cash outlays for environmental matters within the next 5 years. Self-insurance – We are self-insured for certain costs, primarily workers' compensation claims and medical and dental benefits for active employees and those employees on long-term disability. The liabilities associated with these items represent our best estimate of the ultimate obligations for reported claims plus those incurred, but not reported, and totaled $6,627 as of December 31, 2018 and $7,679 as of December 31, 2017 . These accruals are included in accrued liabilities and other non-current liabilities in the consolidated balance sheets. Our workers' compensation liability is recorded at present value. The difference between the discounted and undiscounted liability was not significant as of December 31, 2018 or December 31, 2017 . Our self-insurance liabilities are estimated, in part, by considering historical claims experience, demographic factors and other actuarial assumptions. The estimated accruals for these liabilities could be significantly affected if future events and claims differ from these assumptions and historical trends. Litigation – Recorded liabilities for legal matters, as well as related charges recorded in each of the past 3 years, were not material to our financial position, results of operations or liquidity during the periods presented, and we do not believe that any of the currently identified claims or litigation will materially affect our financial position, results of operations or liquidity upon resolution. However, litigation is subject to inherent uncertainties, and unfavorable rulings could occur. If an unfavorable ruling were to occur, it may cause a material adverse impact on our financial position, results of operations or liquidity for the period in which the ruling occurs or in future periods. |
Shareholders' equity
Shareholders' equity | 12 Months Ended |
Dec. 31, 2018 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' equity | Shareholders’ equity In May 2016, our board of directors authorized the repurchase of up to $300,000 of our common stock, and in October 2018, the board increased our share repurchase authorization to $500,000 , inclusive of the remaining amount outstanding under the prior authorization. This authorization has no expiration date. During 2018, we repurchased 3.6 million shares for $200,000 under these authorizations. Under the May 2016 authorization and under a previous authorization, we repurchased 924 thousand shares for $65,000 during 2017 and we repurchased 901 thousand shares for $55,224 during 2016. As of December 31, 2018, $420,000 remained available for repurchase under the current authorization. |
Business segment information
Business segment information | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Business segment information | Business segment information We operate 3 reportable business segments: Small Business Services, Financial Services and Direct Checks. Our business segments are generally organized by the type of customer served and reflect the way we manage the company. Small Business Services promotes and sells products and services to businesses via direct response mail and internet advertising; referrals from financial institutions, telecommunications clients and other partners; networks of Safeguard distributors and independent dealers; a direct sales force that focuses on selling to and through enterprise accounts; and an outbound telemarketing group. Financial Services' products and services are sold primarily through a direct sales force that executes product and service supply contracts with our financial institution clients, including banks, credit unions and financial services companies. Direct Checks sells products and services directly to consumers using direct marketing, including print advertising and search engine marketing and optimization strategies. All 3 segments operate primarily in the United States. Small Business Services also has operations in Canada, Australia and portions of Europe, and Financial Services has operations in Canada. No single customer accounted for more than 10% of consolidated revenue during the past 3 years. Our product and service offerings are comprised of the following: Marketing solutions and other services (MOS) – We offer products and services designed to meet our customers’ sales and marketing needs, as well as various other service offerings. During 2018 , MOS represented 37.3% of our Small Business Services segment's revenue, 59.0% of our Financial Services segment's revenue and 11.1% of our Direct Checks segment's revenue. Our MOS offerings generally consist of the following: • Small business marketing solutions – Our marketing products utilize digital printing and web-to-print solutions to provide printed marketing materials and promotional solutions, such as postcards, brochures, retail packaging supplies, apparel, greeting cards and business cards. • Web services – These service offerings include hosting and domain name services, logo and web design, search engine marketing and optimization, email marketing, payroll services and business incorporation and organization services. • Data-driven marketing solutions – These Financial Services offerings include outsourced marketing campaign targeting and execution and marketing analytics solutions that help our customers grow revenue through strategic targeting, lead optimization, retention and cross-selling services. • Treasury management solutions – These Financial Services solutions include remote deposit capture, receivables management, payment processing, and paperless treasury management, as well as software, hardware and digital imaging solutions. • Fraud, security, risk management and operational services – These service offerings include fraud protection and security services, electronic checks and deposits ("ePayments") and digital engagement solutions, including loyalty and rewards programs and financial management tools. Checks – We remain one of the largest providers of checks in the United States. During 2018 , checks represented 37.1% of our Small Business Services segment's revenue, 38.6% of our Financial Services segment's revenue and 84.0% of our Direct Checks segment's revenue. Forms, accessories and other products – Our Small Business Services segment provides printed forms to small businesses, including deposit tickets, billing forms, work orders, job proposals, purchase orders, invoices and personnel forms, as well as computer forms compatible with accounting software packages commonly used by small businesses. Small Business Services also offers other customized products, including envelopes, office supplies, ink stamps and labels. Our Financial Services and Direct Checks segments offer deposit tickets, check registers, checkbook covers, labels and ink stamps. The following tables present revenue disaggregated by our product and service offerings: Year Ended December 31, 2018 (in thousands) Small Business Services Financial Services Direct Checks Consolidated Marketing solutions and other services: Small business marketing solutions $ 292,245 $ — $ — $ 292,245 Web services 161,646 — — 161,646 Data-driven marketing solutions — 147,893 — 147,893 Treasury management solutions — 148,011 — 148,011 Fraud, security, risk management and operational services 25,460 50,499 14,146 90,105 Total MOS 479,351 346,403 14,146 839,900 Checks 476,751 — 226,554 107,084 810,389 Forms, accessories and other products 327,518 14,010 6,208 347,736 Total revenue $ 1,283,620 $ 586,967 $ 127,438 $ 1,998,025 Year Ended December 31, 2017 (in thousands) Small Business Services Financial Services Direct Checks Consolidated Marketing solutions and other services: Small business marketing solutions $ 262,192 $ — $ — $ 262,192 Web services 131,644 — — 131,644 Data-driven marketing solutions — 150,572 — 150,572 Treasury management solutions — 109,240 — 109,240 Fraud, security, risk management and operational services 25,491 61,185 15,354 102,030 Total MOS 419,327 320,997 15,354 755,678 Checks 482,928 249,716 118,392 851,036 Forms, accessories and other products 337,484 14,562 6,796 358,842 Total revenue $ 1,239,739 $ 585,275 $ 140,542 $ 1,965,556 Year Ended December 31, 2016 (in thousands) Small Business Services Financial Services Direct Checks Consolidated Marketing solutions and other services: Small business marketing solutions $ 242,710 $ — $ — $ 242,710 Web services 115,226 — — 115,226 Data-driven marketing solutions — 50,022 — 50,022 Treasury management solutions — 92,259 — 92,259 Fraud, security, risk management and operational services 26,948 72,940 16,812 116,700 Total MOS 384,884 215,221 16,812 616,917 Checks 467,386 268,926 128,973 865,285 Forms, accessories and other products 343,473 15,829 7,558 366,860 Total revenue $ 1,195,743 $ 499,976 $ 153,343 $ 1,849,062 Product revenue is recognized at a point in time. Total MOS revenue for 2018 included product revenue of $293,708 and service revenue of $546,192 . The majority of our service revenue is recognized over time as services are provided. The following table presents revenue disaggregated by geography, based on where items are shipped or services are performed: (in thousands) Small Business Services Financial Services Direct Checks Total Year Ended December 31, 2018 United States $ 1,180,019 $ 563,918 $ 127,438 $ 1,871,375 Foreign, primarily Canada and Australia 103,601 23,049 — 126,650 Total revenue $ 1,283,620 $ 586,967 $ 127,438 $ 1,998,025 Year Ended December 31, 2017 United States $ 1,150,055 $ 568,801 $ 140,542 $ 1,859,398 Foreign, primarily Canada and Australia 89,684 16,474 — 106,158 Total revenue $ 1,239,739 $ 585,275 $ 140,542 $ 1,965,556 Year Ended December 31, 2016 United States $ 1,123,382 $ 499,976 $ 153,343 $ 1,776,701 Foreign, primarily Canada and Australia 72,361 — — 72,361 Total revenue $ 1,195,743 $ 499,976 $ 153,343 $ 1,849,062 Substantially all of our long-lived assets reside in the United States. Long-lived assets of our foreign subsidiaries are located primarily in Australia and Canada and are not significant to our consolidated financial position. The accounting policies of the segments are the same as those described in Note 1. We allocate corporate costs for our shared services functions to our business segments, including costs of our executive management, human resources, supply chain, real estate, finance, information technology and legal functions. Where costs incurred are directly attributable to a business segment, those costs are charged directly to that segment. During 2017 and 2016, costs that were not directly attributable to a business segment were allocated to the segments based on segment revenue. Effective January 1, 2018, we completed a more detailed analysis of our corporate costs and were able to allocate substantially all of the costs directly to our business segments. The costs that were not directly allocated to a business segment, primarily certain human resources costs, were allocated to the segments based on the number of employees in each segment. This change in our allocation methodology did not have a significant impact on the operating results of our business segments. Corporate assets are not allocated to the segments and consisted primarily of long-term investments and assets related to our corporate shared services functions of manufacturing, information technology and real estate, including property, plant and equipment; internal-use software; and inventories and supplies. Depreciation and amortization expense related to corporate assets, which was allocated to the segments, was $33,812 in 2018 , $33,302 in 2017 and $32,785 in 2016 . We are an integrated enterprise, characterized by substantial intersegment cooperation, cost allocations and the sharing of assets. Therefore, we do not represent that these segments, if operated independently, would report the operating income and other financial information shown. The following is our segment information as of and for the years ended December 31: Reportable Business Segments (in thousands) Small Business Services Financial Services Direct Checks Corporate Consolidated Total revenue from external 2018 $ 1,283,620 $ 586,967 $ 127,438 $ — $ 1,998,025 customers: 2017 1,239,739 585,275 140,542 — 1,965,556 2016 1,195,743 499,976 153,343 — 1,849,062 Operating income: 2018 119,808 69,939 41,474 — 231,221 2017 181,528 101,047 46,601 — 329,176 2016 207,581 106,335 52,971 — 366,887 Depreciation and amortization 2018 66,031 61,843 3,226 — 131,100 expense: 2017 56,834 62,592 3,226 — 122,652 2016 52,195 35,850 3,538 — 91,583 Asset impairment charges: 2018 99,437 1,882 — — 101,319 2017 54,880 — — — 54,880 2016 — — — — — Total assets: 2018 1,094,262 751,242 157,802 301,790 2,305,096 2017 1,081,098 679,547 158,827 289,355 2,208,827 2016 1,086,500 631,353 161,039 305,446 2,184,338 Capital asset purchases: 2018 — — — 62,238 62,238 2017 — — — 47,450 47,450 2016 — — — 46,614 46,614 |
SUMMARIZED QUARTERLY FINANCIAL
SUMMARIZED QUARTERLY FINANCIAL DATA (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data [Abstract] | |
Summarized Quarterly Financial Data (Unaudited) | DELUXE CORPORATION SUMMARIZED QUARTERLY FINANCIAL DATA (Unaudited) (in thousands, except per share amounts) 2018 Quarter Ended March 31 June 30 September 30 December 31 Total revenue $ 491,914 $ 488,244 $ 493,190 $ 524,677 Gross profit 303,156 298,043 295,556 309,522 Net income (loss) 63,336 60,207 (31,083 ) 57,170 Earnings (loss) per share: Basic 1.32 1.26 (0.67 ) 1.25 Diluted 1.31 1.25 (0.67 ) 1.25 Cash dividends per share 0.30 0.30 0.30 0.30 2017 Quarter Ended March 31 June 30 September 30 December 31 Total revenue $ 487,766 $ 485,232 $ 497,669 $ 494,889 Gross profit 308,452 305,864 304,598 303,935 Net income 57,066 59,579 28,801 84,709 Earnings per share: Basic 1.17 1.23 0.60 1.76 Diluted 1.16 1.22 0.59 1.75 Cash dividends per share 0.30 0.30 0.30 0.30 Significant items affecting the comparability of quarterly results were as follows: 2018 Quarter Ended (in thousands) March 31 June 30 September 30 December 31 Asset impairment charges $ 2,149 $ — $ 99,170 $ — Restructuring and integration expense 2,322 6,371 5,104 7,406 Gain on sales of businesses and customer lists 7,228 3,862 1,765 2,786 Certain litigation 297 631 1,805 7,769 CEO transition costs — 1,530 2,622 3,058 Impact of the Tax Cuts and Jobs Act (310 ) 441 (1,249 ) (582 ) Other discrete income tax (benefit) expense (1) (579 ) (1,167 ) 15,634 (1,987 ) 2017 Quarter Ended March 31 June 30 September 30 December 31 Asset impairment charges $ 5,296 $ 2,954 $ 46,630 $ — Restructuring and integration expense 993 1,457 1,242 5,438 Gain on sales of businesses and customer lists 6,779 — 1,924 — Impact of the Tax Cuts and Jobs Act — — — (20,500 ) Other discrete income tax (benefit) expense (1) (3,664 ) (1,276 ) 4,555 (1,843 ) (1) Relates primarily to the tax effects of share-based compensation and the non-deductible portion of goodwill impairment charges in the third quarter of each year. In November 2016, the FASB issued Accounting Standards Update No. 2016-18, Restricted Cash . This standard requires the statement of cash flows to explain the change during the period in the total of cash, cash equivalents, restricted cash and restricted cash equivalents. This standard was effective for us on January 1, 2018 and must be applied retrospectively. During the quarter ended December 31, 2018, we identified a misstatement in our statement of cash flows presentation under this standard. We concluded that the cash and cash equivalents included in funds held for customers should be included with cash, cash equivalents, restricted cash and restricted cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statements of cash flows, in accordance with ASU No. 2016-18. Additionally, we determined that gross redemptions and purchases of marketable debt securities included in funds held for customers should be presented as cash flows from investing activities in the statements of cash flows. This misstatement affected our consolidated statements of cash flows as presented in our 2018 Quarterly Reports on Form 10-Q. We assessed the materiality of this misstatement on prior periods' financial statements in accordance with the Securities and Exchange Commission Staff Accounting Bulletin No. 99, Materiality , codified in Accounting Standards Codification (ASC) 250, Presentation of Financial Statements . We concluded that the misstatement was not material to any prior interim period and therefore, amendments of previously filed reports are not required. Periods presented herein will be revised, as applicable, in future Quarterly Reports on Form 10Q. The revisions had no impact on total assets, total liabilities, shareholders' equity, net income or net cash provided by operating activities. The revised total of cash, cash equivalents, restricted cash and restricted cash equivalents as of the end of each interim period in 2018 and 2017 is as follows: (in thousands) Cash, cash equivalents, restricted cash and restricted cash equivalents (unaudited) September 30, 2018 $ 126,114 June 30, 2018 145,303 March 31, 2018 146,479 September 30, 2017 115,172 June 30, 2017 105,479 March 31, 2017 160,000 |
Significant accounting polici_2
Significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Nature of operations | Nature of operations – We provide a selection of customer life cycle management solutions that help our customers acquire and engage their customers across multiple channels. We offer a wide range of services and products to small businesses, including hosting and domain name services, logo and web design, search engine marketing and optimization, email marketing, payroll services, and business incorporation and organization services, in addition to our checks, forms and promotional product offerings. For financial institutions, we offer our check program solutions, as well as a selection of financial technology solutions, including data-driven marketing, including outsourced marketing campaign targeting and execution; treasury management solutions, including accounts receivable processing and remote deposit capture; and digital engagement solutions, including loyalty and rewards programs. We are also a leading printer of checks and accessories sold directly to consumers. |
Consolidation | Consolidation – The consolidated financial statements include the accounts of Deluxe Corporation and its wholly-owned subsidiaries. All intercompany accounts, transactions and profits have been eliminated. |
Comparability | Comparability – Amounts within the consolidated balance sheet as of December 31, 2017 have been modified to conform to the current year presentation. Revenue in excess of billings is now presented separately. Previously, this amount was included in other current assets. Additionally, amounts within the cash flows from operating activities section of the consolidated statement of cash flows for the year ended December 31, 2017 have been modified to conform to the current year presentation. Gain on sales of businesses and customer lists is now presented separately. In the previous year, this amount was included within other non-cash items, net. The consolidated statements of income for 2017 and 2016 have been revised to reflect the adoption of Accounting Standards Update (ASU) No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . The consolidated statements of cash flows for 2017 and 2016 have been revised to reflect the adoption of ASU No. 2016-18, Restricted Cash . Further information regarding these standards can be found in Note 2. |
Use of estimates | Use of estimates – We have prepared the accompanying consolidated financial statements in conformity with generally accepted accounting principles (GAAP) in the United States. In this process, it is necessary for us to make certain assumptions and estimates affecting the amounts reported in the consolidated financial statements and related notes. These estimates and assumptions are developed based upon all available information. However, actual results can differ from assumed and estimated amounts. |
Foreign currency translation | Foreign currency translation – |
Cash and cash equivalents | Cash and cash equivalents – We consider all cash on hand and other highly liquid investments with original maturities of 3 months or less to be cash and cash equivalents. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents approximate fair value. Checks issued by us but not presented to the banks for payment may create negative book cash balances. These book overdrafts are included in accounts payable on the consolidated balance sheets and totaled $1,270 as of December 31, 2018 and $5,665 as of December 31, 2017 |
Trade accounts receivable | Trade accounts receivable – Trade accounts receivable are initially recorded at the invoiced amount upon the sale of goods or services to customers, and they do not bear interest. They are stated net of allowances for uncollectible accounts, which represent estimated losses resulting from the inability of customers to make the required payments. When determining the allowances for uncollectible accounts, we take several factors into consideration, including the overall composition of accounts receivable aging, our prior history of accounts receivable write-offs, the type of customer and our day-to-day knowledge of specific customers. Changes in the allowances for uncollectible accounts are included in selling, general and administrative (SG&A) expense in our consolidated statements of income. The point at which uncollected accounts are written off varies by type of customer, but generally does not exceed 1 |
Inventories and supplies | Inventories and supplies – Inventories are stated at the lower of cost or net realizable value. Cost is calculated on the first-in, first-out basis. Supplies consist of items not used directly in the production of goods, such as maintenance and other supplies utilized in the production area. |
Funds held for customers | Funds held for customers – Our payroll services businesses collect funds from clients to pay their payroll and related taxes. We hold these funds temporarily until payments are remitted to the clients' employees and the appropriate taxing authorities. The customer contracts for our domestic payroll processing business include legal restrictions regarding the use of these funds. In addition, our treasury management cash receipt processing business remits a portion of cash receipts to our clients the business day following receipt. All of these funds, consisting of cash and available-for-sale debt securities, are reported as funds held for customers in the consolidated balance sheets. The corresponding liability for these obligations is included in accrued liabilities in the consolidated balance sheets. The available-for-sale debt securities are carried at fair value, with unrealized gains and losses included in accumulated other comprehensive loss in the consolidated balance sheets. Realized gains and losses are included in revenue in our consolidated statements of income and were not significant during the past 3 years. |
Long-term investments | Long-term investments – Long-term investments consist primarily of cash surrender values of company-owned life insurance policies. Certain of these policies fund amounts due under our deferred compensation plan and our inactive supplemental executive retirement plan. Further information regarding these plans can be found in Notes 13 and 14. |
Property, plant and equipment | Property, plant and equipment – Property, plant and equipment, including leasehold and other improvements that extend an asset's useful life or productive capabilities, are stated at historical cost less accumulated depreciation. Buildings have been assigned useful lives of 40 years and machinery and equipment are generally assigned useful lives ranging from 1 year to 11 years, with a weighted-average useful life of 7 years as of December 31, 2018 . Buildings are depreciated using the 150% declining balance method, and machinery and equipment is depreciated using the sum-of-the-years' digits method. Leasehold and building improvements are depreciated on the straight-line basis over the estimated useful life of the property or the life of the lease, whichever is shorter. Maintenance and repairs are expensed as incurred. |
Assets held for sale | Assets held for sale – |
Intangibles | Intangibles – Intangible assets are stated at historical cost less accumulated amortization. Amortization expense is generally determined on the straight-line basis, with the exception of customer lists, which are generally amortized using accelerated methods that reflect the pattern in which we receive the economic benefit of the asset. Intangibles have been assigned useful lives ranging from 1 year to 14 years, with a weighted-average useful life of 6 years as of December 31, 2018 . Each reporting period, we evaluate the remaining useful lives of our amortizable intangibles to determine whether events or circumstances warrant a revision to the remaining period of amortization. If our estimate of an asset's remaining useful life is revised, the remaining carrying amount of the asset is amortized prospectively over the revised remaining useful life. As of December 31, 2017 , we held a trade name asset that was assigned an indefinite useful life. As such, this asset was not amortized, but was subject to impairment testing on at least an annual basis. During 2018, we determined that this asset was fully impaired. Further information regarding the resulting asset impairment charge can be found in Note 8. Any gains or losses resulting from the disposition of intangibles are included in SG&A expense in the consolidated statements of income. We capitalize costs of software developed or obtained for internal use, including website development costs, once the preliminary project stage has been completed, management commits to funding the project and it is probable that the project will be completed and the software will be used to perform the function intended. Capitalized costs include only (1) external direct costs of materials and services consumed in developing or obtaining internal-use software, (2) payroll and payroll-related costs for employees who are directly associated with and who devote time to the internal-use software project, and (3) interest costs incurred, when significant, while developing internal-use software. Costs incurred in populating websites with information about the company or products are expensed as incurred. Capitalization of costs ceases when the project is substantially complete and ready for its intended use. The carrying value of internal-use software is reviewed in accordance with our policy on impairment of long-lived assets and amortizable intangibles. |
Impairment of long-lived assets and amortizable intangibles | Impairment of long-lived assets and amortizable intangibles – We evaluate the recoverability of property, plant, equipment and amortizable intangibles not held for sale whenever events or changes in circumstances indicate that an asset group's carrying amount may not be recoverable. Such circumstances could include, but are not limited to, (1) a significant decrease in the market value of an asset, (2) a significant adverse change in the extent or manner in which an asset is used or in its physical condition, or (3) an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of an asset. We compare the carrying amount of the asset group to the estimated undiscounted future cash flows associated with it. If the sum of the expected future net cash flows is less than the carrying value of the asset group being evaluated, an impairment loss would be recognized. The impairment loss would be calculated as the amount by which the carrying value of the asset group exceeds the fair value of the asset group. As quoted market prices are not available for the majority of our assets, the estimate of fair value is based on various valuation techniques, including the discounted value of estimated future cash flows. During 2018 and 2017, we recorded asset impairment charges related to certain intangible assets. Further information regarding these impairment charges can be found in Note 8. We evaluate the recoverability of property, plant, equipment and intangibles held for sale by comparing the asset's carrying amount with its estimated fair value less costs to sell. Should the estimated fair value less costs to sell be less than the carrying value of the long-lived asset, an impairment loss would be recognized. The impairment loss would be calculated as the amount by which the carrying value of the asset exceeds the estimated fair value of the asset less costs to sell. During 2017, we recorded asset impairment charges related to Small Business Services assets held for sale. Further information regarding the impairment charges can be found in Note 8. |
Impairment of indefinite-lived intangibles and goodwill | Impairment of indefinite-lived intangibles and goodwill – We evaluate the carrying value of indefinite-lived intangibles and goodwill on July 31 st of each year and between annual evaluations if events occur or circumstances change that would indicate a possible impairment. Such circumstances could include, but are not limited to, (1) a significant adverse change in legal factors or in business climate, (2) unanticipated competition, (3) an adverse change in market conditions that are indicative of a decline in the fair value of the assets, (4) a change in our business strategy, or (5) an adverse action or assessment by a regulator. Information regarding the results of our impairment analyses can be found in Note 8. In completing the annual impairment analysis of our indefinite-lived trade name in each of the past 3 years, we elected to perform a quantitative assessment. This assessment compared the carrying amount of the asset to its estimated fair value. The estimate of fair value was based on the relief from royalty method, which calculates the cost savings associated with owning rather than licensing the trade name. An assumed royalty rate was applied to forecasted revenue and the resulting cash flows were discounted. If the estimated fair value is less than the carrying value of the asset, an impairment loss is recognized for the difference. During 2018, our analysis indicated that this asset was fully impaired. Further information regarding this impairment can be found in Note 8. To analyze goodwill for impairment, we must assign our goodwill to individual reporting units. Identification of reporting units includes an analysis of the components that comprise each of our operating segments, which considers, among other things, the manner in which we operate our business and the availability of discrete financial information. Components of an operating segment are aggregated to form 1 reporting unit if the components have similar economic characteristics. We periodically review our reporting units to ensure that they continue to reflect the manner in which we operate our business. When completing our annual goodwill impairment analysis, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after this qualitative assessment, we determine it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative impairment test is unnecessary. When performing a quantitative analysis of goodwill, we calculate the estimated fair value of the reporting unit and compare this amount to the carrying amount of the reporting unit's net assets. In calculating the estimated fair value of a business unit, we use the income approach. This approach is a valuation technique under which we estimate future cash flows using the reporting unit's financial forecast from the perspective of an unrelated market participant. Using historical trending and internal forecasting techniques, we project revenue and apply our fixed and variable cost experience rates to the projected revenue to arrive at the future cash flows. A terminal value is then applied to the projected cash flow stream. Future estimated cash flows are discounted to their present value to calculate the estimated fair value. Our discount rate is the market-value-weighted average of our estimated cost of capital derived using both known and estimated customary market metrics. In determining the estimated fair values of our reporting units, we are required to estimate a number of factors, including projected operating results, terminal growth rates, economic conditions, anticipated future cash flows, the discount rate and the allocation of shared or corporate items. When completing a quantitative analysis for all of our reporting units, the summation of our reporting units' fair values is compared to our consolidated fair value, as indicated by our market capitalization, to evaluate the reasonableness of our calculations. If the carrying amount of a reporting unit's net assets exceeds its estimated fair value, an impairment loss is recorded for the difference, not to exceed the carrying amount of goodwill. |
Prepaid product discounts | Certain of our financial institution contracts require prepaid product discounts in the form of upfront cash payments or accruals for amounts owed to financial institution clients of our Financial Services segment. These prepaid product discounts are included in other non-current assets in our consolidated balance sheets and are generally amortized as reductions of revenue on the straight-line basis over the contract term. Currently, these amounts are being amortized over periods ranging from 1 year to 10 years, with a weighted-average life of 6 years as of December 31, 2018 |
Advertising costs | Advertising costs – Deferred advertising costs include materials, printing, labor and postage costs related to direct response advertising programs of our Direct Checks and Small Business Services segments. These costs are amortized as SG&A expense over periods (not exceeding 18 months) that correspond to the estimated revenue streams of the individual advertisements. The actual revenue streams are analyzed at least annually to monitor the propriety of the amortization periods. Judgment is required in estimating the future revenue streams, especially with regard to check re-orders, which can span an extended period of time. Significant changes in the actual revenue streams would require the amortization periods to be modified, thus impacting our results of operations during the period in which the change occurred and in subsequent periods. Within our Direct Checks segment, approximately 88% of the costs of individual advertisements is expensed within 6 months of the advertisement. The deferred advertising costs of our Small Business Services segment are fully amortized within 6 months of the advertisement. Deferred advertising costs are included in other current assets and other non-current assets in the consolidated balance sheets. Non-direct response advertising projects are expensed as incurred. Catalogs provided to financial institution clients of our Financial Services segment are accounted for as prepaid assets until they are shipped to financial institutions. The total amount of advertising expense, including direct response and non-direct response advertising, was $74,549 in 2018 , $78,722 in 2017 and $85,141 in 2016 |
Loans and notes receivable from distributors | Loans and notes receivable from distributors – We have, at times, provided loans to certain of our Safeguard ® distributors to allow them to purchase the operations of other small business distributors. We have also sold distributors and customer lists that we own in exchange for notes receivable. These loans and notes receivable are included in other current assets and other non-current assets in the consolidated balance sheets. Interest is accrued at market interest rates as earned. We continually monitor the credit quality and associated risks of these receivable on an individual basis based on criteria such as the financial stability of the distributor, historical commissions earned and their reported financial results. We generally withhold commissions payable to the distributors to settle the monthly payments due on the receivables, thus, somewhat mitigating the risk that the receivables will not be collected. As of December 31, 2018 and December 31, 2017 |
Restructuring and integration expense | Restructuring and integration expense – Over the past several years, we have recorded restructuring and integration expense as a result of various cost management efforts, including facility closings and the relocation of business activities, as well as fundamental changes in the manner in which certain business functions are conducted, including the integration of acquired businesses and the consolidation of redundant information technology systems. These expenses have consisted of costs which are expensed when incurred, such as information technology costs, employee and equipment moves, training and travel, as well as accruals for employee termination benefits payable under our ongoing severance benefit plan. We record accruals for employee termination benefits when it is probable that a liability has been incurred and the amount of the liability is reasonably estimable. We are required to make estimates and assumptions in calculating the restructuring accruals as, on some occasions, employees choose to voluntarily leave the company prior to their termination date or they secure another position within the company. In these situations, the employees do not receive termination benefits. To the extent our assumptions and estimates differ from our actual costs, subsequent adjustments to restructuring and integration accruals have been and will be required. Restructuring and integration accruals are included in accrued liabilities and other non-current liabilities in our consolidated balance sheets. |
Litigation | Litigation – We are party to legal actions and claims arising in the ordinary course of business. We record accruals for legal matters when the expected outcome of these matters is either known or considered probable and can be reasonably estimated. Our accruals do not include related legal and other costs expected to be incurred in defense of legal actions. Further information regarding litigation can be found in Note 16. |
Income taxes | Income taxes – Deferred income taxes result from temporary differences between the financial reporting basis of assets and liabilities and their respective tax reporting basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences reverse. Net deferred tax assets are recognized to the extent that realization of such benefits is more likely than not. We are subject to tax audits in numerous domestic and foreign tax jurisdictions. Tax audits are often complex and can require several years to complete. In the normal course of business, we are subject to challenges from the Internal Revenue Service and other tax authorities regarding the amount of taxes due. These challenges may alter the timing or amount of taxable income or deductions, or the allocation of income among tax jurisdictions. We recognize the benefits of tax return positions in the financial statements when they are more-likely-than-not to be sustained by the taxing authorities based solely on the technical merits of the position. If the recognition threshold is met, the tax benefit is measured and recognized as the largest amount of tax benefit that, in our judgment, is greater than 50% likely to be realized. Accrued interest and penalties related to unrecognized tax positions are included in our provision for income taxes in the consolidated statements of income. |
Derivative financial instruments | Derivative financial instruments – Information regarding our derivative financial instruments is included in Note 7. We did not have any derivative instruments outstanding as of December 31, 2018 or December 31, 2017, as we settled all of our interest rate swaps during 2016. We do not use derivative financial instruments for speculative or trading purposes. Our policy is that all derivative transactions must be linked to an existing balance sheet item or firm commitment, and the notional amount cannot exceed the value of the exposure being hedged. |
Revenue recognition | Revenue recognition – On January 1, 2018, we adopted ASU No. 2014-09, Revenue from Contracts with Customers, along with subsequent amendments to this standard. We applied the new standards using the modified retrospective approach under which the cumulative effect of initially applying the standards was recorded as an adjustment to retained earnings as of the date of adoption. As such, prior periods have not been revised and continue to be reported under the accounting standards in effect for those periods. Further information regarding the adoption of this standard can be found in Note 2. Beginning in 2018, our product revenue is recognized when control of the goods is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods. In most cases, control is transferred when products are shipped. We recognize the vast majority of our service revenue as the services are provided. The majority of our contracts are for the shipment of tangible products or the delivery of services that have a single performance obligation or include multiple performance obligations where control is transferred at the same time. During previous years, revenue was recognized when (1) persuasive evidence of an arrangement existed, (2) delivery occurred or services were rendered, (3) the sales price was fixed or determinable, and (4) collectibility was reasonably assured. Our product revenue was recognized upon shipment or customer receipt, based upon the transfer of title, and we recognized the majority of our service revenue as the services were provided. In all periods, revenue is presented in the consolidated statements of income net of rebates, discounts, amortization of prepaid product discounts, and sales tax collected concurrent with revenue-producing activities. Many of our check supply contracts with financial institutions provide for rebates on certain products. We record these rebates as reductions of revenue and as accrued liabilities on our consolidated balance sheets when the related revenue is recognized. Amounts billed to customers for shipping and handling are included in revenue, while the related shipping and handling costs are reflected in cost of products and are accrued when the related revenue is recognized. When another party is involved in providing goods or services to a customer, we must determine whether our obligation is to provide the specified good or service itself (i.e., we are the principal in the transaction) or to arrange for that good or service to be provided by the other party (i.e., we are an agent in the transaction). When we are responsible for satisfying a performance obligation, based on our ability to control the product or service provided, we are considered the principal and revenue is recognized for the gross amount of consideration. When the other party is primarily responsible for satisfying a performance obligation, we are considered the agent and revenue is recognized in the amount of any fee or commission to which we are entitled. In the case of our Financial Services rewards, incentive and loyalty programs, we receive payments from consumers or our clients for the products and services provided, including hotel stays, gift cards and merchandise. We have determined that we are an agent in these transactions and this revenue is recorded net of the related fulfillment costs. Within our Small Business Services segment, we sell certain products and services through a network of Safeguard distributors. We have determined that we are the principal in these transactions and revenue is recorded for the gross amount of consideration. Certain of our contracts for data-driven marketing solutions and treasury management outsourcing services within Financial Services have variable consideration that is contingent on either the success of the marketing campaign ("pay-for-performance") or the volume of outsourcing services provided. We recognize revenue for estimated variable consideration as services are provided based on the most likely amount to be realized. Revenue is recognized to the extent that it is probable that a significant reversal of revenue will not occur when the contingency is resolved. Estimates regarding the recognition of variable consideration are updated each quarter. Typically, the amount of consideration for these contracts is finalized within 4 months, although pricing under certain of our outsourcing contracts may be based on annual volume commitments. Revenue recognized from these contracts was approximately $130,000 in 2018. Upon adoption of ASU No. 2014-09, we accelerated the recognition of a portion of this variable consideration. Our payment terms vary by type of customer and the products or services offered. The time period between invoicing and when payment is due is not significant. For certain products, services and customer types, we require payment before the products or services are delivered to the customer. When a customer pays in advance, primarily for treasury management solutions and web hosting services, we defer the revenue and recognize it as the services are performed, generally over a period of less than 1 year. Deferred revenue is included in accrued liabilities and other non-current liabilities in our consolidated balance sheets. The increase of $5,704 in deferred revenue during the year ended December 31, 2018 was driven primarily by cash payments received in advance of satisfying our performance obligations, partially offset by the recognition of $45,405 of revenue that was included in deferred revenue as of December 31, 2017 . In addition to the amounts included in deferred revenue, we will recognize revenue in future periods related to remaining performance obligations for certain of our data-driven marketing and treasury management solutions. Generally, these contracts have terms of 1 year or less and many have terms of 3 months or less. The amount of revenue related to these unsatisfied performance obligations is not significant to our annual consolidated revenue. When the revenue recognized for uncompleted contracts exceeds the amount of customer billings and the right to receive the consideration is conditional, a contract asset is recorded. These amounts are included in revenue in excess of billings on the consolidated balance sheets and totaled $19,705 as of December 31, 2018 and $7,387 as of December 31, 2017 . Additionally, we record an asset for unbilled receivables when the revenue recognized has not been billed to customers in accordance with contractually stated billing terms and the right to receive the consideration is unconditional. These assets are also included in revenue in excess of billings on the consolidated balance sheets and totaled $10,753 as of December 31, 2018 and $8,992 as of December 31, 2017 . At times, a financial institution client may terminate its check supply contract with us prior to the end of the contract term. In many cases, the financial institution is contractually required to remit a contract termination payment. Such payments are recorded as revenue when the termination agreement is executed, provided that we have no further performance obligations and collection of the funds is assured. If we have further performance obligations following the execution of a contract termination agreement, we record the related revenue over the remaining service period. Beginning in 2018, sales commissions related to obtaining check supply and treasury management solution contracts within Financial Services are recorded as other non-current assets in the consolidated balance sheets and are amortized on the straight-line basis as SG&A expense. Amortization of these amounts on the straight-line basis approximates the timing of the transfer of goods or services to the customer. Generally, these amounts are being amortized over periods of 3 to 6 years. |
Employee share-based compensation | Employee share-based compensation – Our share-based compensation consists of non-qualified stock options, restricted stock units, restricted stock, performance share awards and an employee stock purchase plan. Employee share-based compensation expense is included in total cost of revenue and in SG&A expense in our consolidated statements of income, based on the functional areas of the employees receiving the awards, and is recognized as follows: • The fair value of stock options is measured on the grant date using the Black-Scholes option pricing model. The related compensation expense is recognized on the straight-line basis, net of estimated forfeitures, over the options' vesting periods. • The fair value of restricted stock and a portion of our restricted stock unit awards is measured on the grant date based on the market value of our common stock. The related compensation expense, net of estimated forfeitures, is recognized over the applicable service period. • Certain of our restricted stock unit awards may be settled in cash if an employee voluntarily chooses to leave the company. These awards are included in accrued liabilities and other non-current liabilities in the consolidated balance sheets and are re-measured at fair value as of each balance sheet date. • Compensation expense resulting from the 15% discount provided under our employee stock purchase plan is recognized over the purchase period of 6 months. • The performance share awards specify certain performance and market-based conditions that must be achieved in order for the awards to vest. For the portion of the awards based on a performance condition, the performance target is not considered in determining the fair value of the awards and thus, fair value is measured on the grant date based on the market value of our common stock. The related compensation expense for this type of award is recognized, net of estimated forfeitures, over the related service period. The amount of compensation expense is dependent on our periodic assessment of the probability of the targets being achieved and our estimate, which may vary over time, of the number of shares that ultimately will be issued. For the portion of the awards based on a market condition, fair value is calculated on the grant date using the Monte Carlo simulation model. All compensation cost for these awards is recognized, net of estimated forfeitures, over the related service period, even if the market condition is never satisfied. |
Earnings per share | Earnings per share – We calculate earnings per share using the two-class method, as we have unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalent payments. The two-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating security according to dividends declared and participation rights in undistributed earnings. Basic earnings per share is based on the weighted-average number of common shares outstanding during the year. Diluted earnings per share is based on the weighted-average number of common shares outstanding during the year, adjusted to give effect to potential common shares such as stock options and shares to be issued under our employee stock purchase plan. |
Comprehensive income | Comprehensive income – Comprehensive income includes charges and credits to shareholders' equity that are not the result of transactions with shareholders. Our total comprehensive income consists of net income, changes in the funded status and amortization of amounts related to our postretirement benefit plans, unrealized gains and losses on available-for-sale debt securities, and foreign currency translation adjustments. The items of comprehensive income, with the exception of net income, are included in accumulated other comprehensive loss in the consolidated balance sheets and statements of shareholders' equity, net of their related tax impacts. We release stranded income tax effects from accumulated other comprehensive loss when the circumstances upon which they are premised cease to exist. |
New accounting pronouncements (
New accounting pronouncements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Standards Update No. 2014-09 [Member] | |
New accounting pronouncements [Line Items] | |
Impact of new accounting pronouncement | The cumulative effect of adoption of the new revenue guidance on our consolidated balance sheet as of January 1, 2018 was as follows: (in thousands) Balance as of December 31, 2017 Adjustments due to adoption of ASU No. 2014-09 Balance as of January 1, 2018 Revenue in excess of billings $ 16,379 $ 960 $ 17,339 Total current assets 392,966 960 393,926 Other non-current assets 159,756 5,733 165,489 Total assets $ 2,208,827 $ 6,693 $ 2,215,520 Deferred income taxes 50,543 1,727 52,270 Retained earnings 1,004,657 4,966 1,009,623 Total liabilities and shareholders' equity $ 2,208,827 $ 6,693 $ 2,215,520 The impact of the new revenue guidance on our consolidated statement of income for the year ended December 31, 2018 and on our consolidated balance sheet as of December 31, 2018 was as follows: (in thousands) As reported Effect of adoption Amounts without adoption of ASU No. 2014-09 Year Ended December 31, 2018 Service revenue $ 546,192 $ (717 ) $ 545,475 Total revenue 1,998,025 (717 ) 1,997,308 Cost of services (244,108 ) 625 (243,483 ) Total cost of revenue (791,748 ) 625 (791,123 ) Gross profit 1,206,277 (92 ) 1,206,185 Selling, general and administrative expense (854,000 ) (749 ) (854,749 ) Operating income 231,221 (841 ) 230,380 Income before income taxes 212,631 (841 ) 211,790 Income tax provision (63,001 ) 209 (62,792 ) Net income $ 149,630 $ (632 ) $ 148,998 December 31, 2018 Revenue in excess of billings $ 30,458 $ (1,052 ) $ 29,406 Total current assets 450,046 (1,052 ) 448,994 Other non-current assets 196,108 (6,482 ) 189,626 Total assets $ 2,305,096 $ (7,534 ) $ 2,297,562 Accrued liabilities $ 284,281 $ (209 ) $ 284,072 Total current liabilities 392,050 (209 ) 391,841 Deferred income taxes 46,680 (1,727 ) 44,953 Retained earnings 927,345 (5,598 ) 921,747 Total liabilities and shareholders' equity $ 2,305,096 $ (7,534 ) $ 2,297,562 |
Accounting Standards Update No. 2016-18 [Member] | |
New accounting pronouncements [Line Items] | |
Impact of new accounting pronouncement | The impact of this revision on our consolidated statements of cash flows for the years ended December 31, 2017 and December 31, 2016 was as follows: (in thousands) As previously reported Effect of adoption As revised Year Ended December 31, 2017 Purchases of customer funds marketable securities $ — $ (7,737 ) $ (7,737 ) Proceeds from customer funds and corporate marketable securities 3,500 7,737 11,237 Net cash used by investing activities (180,891 ) — (180,891 ) Net change in customer funds obligations — (6,007 ) (6,007 ) Net cash used by financing activities (176,949 ) (6,007 ) (182,956 ) Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents 2,075 3,295 5,370 Net change in cash, cash equivalents, restricted cash and restricted cash equivalents (17,334 ) (2,712 ) (20,046 ) Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year 76,574 72,291 148,865 Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) $ 59,240 $ 69,579 $ 128,819 Year Ended December 31, 2016 Payments for acquisitions, net of cash acquired $ (270,939 ) $ 31,275 $ (239,664 ) Purchases of customer funds marketable securities — (7,869 ) (7,869 ) Proceeds from customer funds and corporate marketable securities 1,635 7,869 9,504 Net cash used by investing activities (310,786 ) 31,275 (279,511 ) Net change in customer funds obligations — 1,723 1,723 Net cash provided by financing activities 4,275 1,723 5,998 Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents 1,346 1,017 2,363 Net change in cash, cash equivalents, restricted cash and restricted cash equivalents 14,147 34,015 48,162 Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year 62,427 38,276 100,703 Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) $ 76,574 $ 72,291 $ 148,865 |
Accounting Standards Update No. 2017-07 [Member] | |
New accounting pronouncements [Line Items] | |
Impact of new accounting pronouncement | The impact of the revision on our consolidated statements of income for the years ended December 31, 2017 and December 31, 2016 was as follows: (in thousands) As previously reported Effect of adoption As revised Year Ended December 31, 2017 Cost of products $ (529,088 ) $ (550 ) $ (529,638 ) Cost of services (213,002 ) (67 ) (213,069 ) Total cost of revenue (742,090 ) (617 ) (742,707 ) Gross profit 1,223,466 (617 ) 1,222,849 Selling, general and administrative expense (828,832 ) (1,399 ) (830,231 ) Operating income 331,192 (2,016 ) 329,176 Other income 2,994 2,016 5,010 Net income $ 230,155 $ — $ 230,155 Year Ended December 31, 2016 Cost of products $ (534,390 ) $ (516 ) $ (534,906 ) Cost of services (132,851 ) (56 ) (132,907 ) Total cost of revenue (667,241 ) (572 ) (667,813 ) Gross profit 1,181,821 (572 ) 1,181,249 Selling, general and administrative expense (805,970 ) (1,268 ) (807,238 ) Operating income 368,727 (1,840 ) 366,887 Other income 1,819 1,840 3,659 Net income $ 229,382 $ — $ 229,382 |
Supplemental balance sheet an_2
Supplemental balance sheet and cash flow information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Supplemental balance sheet and cash flow information [Abstract] | |
Trade accounts receivable | Net trade accounts receivable was comprised of the following at December 31: (in thousands) 2018 2017 Trade accounts receivable – gross $ 177,501 $ 152,728 Allowances for uncollectible accounts (3,639 ) (2,884 ) Trade accounts receivable – net $ 173,862 $ 149,844 Changes in the allowances for uncollectible accounts for the years ended December 31 were as follows: (in thousands) 2018 2017 2016 Balance, beginning of year $ 2,884 $ 2,828 $ 4,816 Bad debt expense 3,622 3,208 2,539 Write-offs, net of recoveries (2,867 ) (3,152 ) (4,527 ) Balance, end of year $ 3,639 $ 2,884 $ 2,828 |
Inventories and supplies | Inventories and supplies were comprised of the following at December 31: (in thousands) 2018 2017 Raw materials $ 7,543 $ 7,357 Semi-finished goods 7,273 7,635 Finished goods 27,608 24,146 Supplies 4,017 3,111 Inventories and supplies $ 46,441 $ 42,249 |
Available-for-sale debt securities | Available-for-sale debt securities included within funds held for customers were comprised of the following: December 31, 2018 (in thousands) Cost Gross unrealized gains Gross unrealized losses Fair value Funds held for customers: (1) Domestic money market fund $ 16,000 $ — $ — $ 16,000 Canadian and provincial government securities 8,485 — (355 ) 8,130 Canadian guaranteed investment certificates 7,333 — — 7,333 Available-for-sale debt securities $ 31,818 $ — $ (355 ) $ 31,463 (1) Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2018 , also included cash of $69,519 . December 31, 2017 (in thousands) Cost Gross unrealized gains Gross unrealized losses Fair value Funds held for customers: (1) Domestic money market fund $ 17,300 $ — $ — $ 17,300 Canadian and provincial government securities 9,051 — (393 ) 8,658 Canadian guaranteed investment certificates 7,955 — — 7,955 Available-for-sale debt securities $ 34,306 $ — $ (393 ) $ 33,913 (1) Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2017 , also included cash of $52,279 |
Expected maturities of available-for-sale debt securities | Expected maturities of available-for-sale debt securities as of December 31, 2018 were as follows: (in thousands) Fair value Due in one year or less $ 25,195 Due in two to five years 3,398 Due in six to ten years 2,870 Available-for-sale debt securities $ 31,463 |
Property, plant and equipment | Property, plant and equipment was comprised of the following at December 31: 2018 2017 (in thousands) Gross carrying amount Accumulated depreciation Net carrying amount Gross carrying amount Accumulated depreciation Net carrying amount Land and improvements $ 28,199 $ (8,167 ) $ 20,032 $ 28,220 $ (8,064 ) $ 20,156 Buildings and improvements 116,348 (83,317 ) 33,031 114,793 (80,168 ) 34,625 Machinery and equipment 313,000 (275,721 ) 37,279 299,645 (269,788 ) 29,857 Property, plant and equipment $ 457,547 $ (367,205 ) $ 90,342 $ 442,658 $ (358,020 ) $ 84,638 |
Assets held for sale | Net assets held for sale consisted of the following at December 31: (in thousands) 2018 2017 Balance sheet caption Current assets $ — $ 4 Other current assets Intangibles 1,350 8,459 Assets held for sale Goodwill — 3,566 Assets held for sale Other non-current assets — 207 Assets held for sale Net assets held for sale $ 1,350 $ 12,236 |
Intangibles | Intangibles were comprised of the following at December 31: 2018 2017 (in thousands) Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Indefinite-lived intangibles: Trade name (1) $ — $ — $ — $ 19,100 $ — $ 19,100 Amortizable intangibles: Internal-use software 388,477 (308,313 ) 80,164 359,079 (284,074 ) 75,005 Customer lists/relationships (2) 379,570 (170,973 ) 208,597 343,589 (121,729 ) 221,860 Trade names 50,645 (26,204 ) 24,441 36,931 (19,936 ) 16,995 Technology-based intangibles 39,300 (14,007 ) 25,293 31,800 (6,400 ) 25,400 Software to be sold 36,900 (15,430 ) 21,470 36,900 (11,204 ) 25,696 Other 700 (700 ) — 1,800 (1,590 ) 210 Amortizable intangibles 895,592 (535,627 ) 359,965 810,099 (444,933 ) 365,166 Intangibles $ 895,592 $ (535,627 ) $ 359,965 $ 829,199 $ (444,933 ) $ 384,266 (1) During the third quarter of 2018, we recorded a pre-tax asset impairment charge of $19,100 for our indefinite-lived trade name. Further information can be found in Note 8. (2) During 2018, we recorded pre-tax asset impairment charges of $4,031 |
Amortization of intangibles | Amortization expense related to intangibles was as follows for the years ended December 31: (in thousands) 2018 2017 2016 Customer lists/relationships $ 57,243 $ 54,450 $ 33,233 Internal-use software 38,307 35,952 35,217 Technology-based intangibles 7,607 6,400 — Trade names 6,362 5,789 4,952 Other amortizable intangibles 5,009 4,193 3,683 Amortization of intangibles $ 114,528 $ 106,784 $ 77,085 |
Estimated amortization expense | Based on the intangibles in service as of December 31, 2018 , estimated amortization expense for each of the next five years ending December 31 is as follows: (in thousands) Estimated amortization expense 2019 $ 90,924 2020 71,135 2021 54,795 2022 39,571 2023 29,205 |
Acquired intangibles | We acquire internal-use software in the normal course of business. We also acquire intangible assets in conjunction with acquisitions (Note 6). The following intangible assets were acquired during the years ended December 31: 2018 2017 2016 (in thousands) Amount Weighted-average amortization period (in years) Amount Weighted-average amortization period (in years) Amount Weighted-average amortization period (in years) Customer lists/relationships (1) $ 60,775 8 $ 60,034 7 $ 118,415 8 Internal-use software 42,744 3 38,422 3 45,780 4 Trade names 14,700 7 10,000 6 3,800 4 Technology-based intangibles 7,500 5 800 3 28,000 5 Software to be sold — — 2,200 5 6,200 10 Acquired intangibles $ 125,719 6 $ 111,456 6 $ 202,195 6 (1) During 2018, we acquired customer lists of $1,188 that did not qualify as business combinations. |
Goodwill | Changes in goodwill by reportable segment and in total were as follows: (in thousands) Small Business Services Financial Services Direct Checks Total Balance, December 31, 2016: Goodwill, gross $ 684,261 $ 293,189 $ 148,506 $ 1,125,956 Accumulated impairment charges (20,000 ) — — (20,000 ) Goodwill, net of accumulated impairment charges 664,261 293,189 148,506 1,105,956 Impairment charge (Note 8) (28,379 ) — — (28,379 ) Goodwill resulting from acquisitions (Note 6) 26,788 33,210 — 59,998 Measurement-period adjustments for prior year acquisitions (Note 6) 30 (2,160 ) — (2,130 ) Sale of small business distributor (1,000 ) — — (1,000 ) Reclassification of assets held for sale (3,970 ) — — (3,970 ) Currency translation adjustment 459 — — 459 Balance, December 31, 2017: Goodwill, gross 706,568 324,239 148,506 1,179,313 Accumulated impairment charges (48,379 ) — — (48,379 ) Goodwill, net of accumulated impairment charges 658,189 324,239 148,506 1,130,934 Impairment charge (Note 8) (78,188 ) — — (78,188 ) Goodwill resulting from acquisitions (Note 6) 59,488 46,419 — 105,907 Measurement-period adjustments for prior year acquisitions (Note 6) 1,420 2,763 — 4,183 Adjustment of assets held for sale 635 — — 635 Currency translation adjustment (2,845 ) — — (2,845 ) Balance, December 31, 2018: Goodwill, gross 765,266 373,421 148,506 1,287,193 Accumulated impairment charges (126,567 ) — — (126,567 ) Goodwill, net of accumulated impairment charges $ 638,699 $ 373,421 $ 148,506 $ 1,160,626 |
Other non-current assets | Other non-current assets were comprised of the following at December 31: (in thousands) 2018 2017 Loans and notes receivable from Safeguard distributors $ 78,693 $ 44,276 Prepaid product discounts (1) 54,642 63,895 Postretirement benefit plan asset (Note 14) 41,259 39,849 Deferred sales commissions (2) 6,482 — Deferred advertising costs 5,746 6,135 Other 9,286 5,601 Other non-current assets $ 196,108 $ 159,756 (1) In our prior year financial statements, we referred to this asset as contract acquisition costs. (2) Net of amortization of $2,722 |
Changes in prepaid product discounts | Changes in prepaid product discounts were as follows for the years ended December 31: (in thousands) 2018 2017 2016 Balance, beginning of year $ 63,895 $ 65,792 $ 58,792 Additions (1) 14,023 18,224 27,506 Amortization (22,941 ) (19,969 ) (20,185 ) Other (335 ) (152 ) (321 ) Balance, end of year $ 54,642 $ 63,895 $ 65,792 (1) Prepaid product discounts are generally accrued upon contract execution. Cash payments made for prepaid product discounts were $23,814 for 2018 , $27,079 for 2017 and $23,068 for 2016 |
Accrued liabilities | Accrued liabilities were comprised of the following at December 31: (in thousands) 2018 2017 Funds held for customers $ 99,818 $ 85,091 Deferred revenue 54,313 47,021 Employee profit sharing/cash bonus 31,286 31,312 Prepaid product discounts due within one year (1) 10,926 11,670 Customer rebates 9,555 11,508 Income tax 7,991 17,827 Acquisition-related liabilities (2) 4,850 23,878 Restructuring and integration (Note 9) 3,320 4,380 Other 62,222 44,566 Accrued liabilities $ 284,281 $ 277,253 (1) In our prior year financial statements, we referred to this liability as contract acquisition costs due within one year. (2) |
Other non-current liabilities | Other non-current liabilities were comprised of the following at December 31: (in thousands) 2018 2017 Prepaid product discounts (1) $ 12,513 $ 21,658 Other 27,367 30,583 Other non-current liabilities $ 39,880 $ 52,241 (1) |
Supplemental cash flow information | Supplemental cash flow information was as follows for the years ended December 31: (in thousands) 2018 2017 2016 Reconciliation of cash, cash equivalents, restricted cash and restricted cash equivalents to the consolidated balance sheets: Cash and cash equivalents $ 59,740 $ 59,240 $ 76,574 Restricted cash and restricted cash equivalents included in funds held for customers 85,519 69,579 72,291 Total cash, cash equivalents, restricted cash and restricted cash equivalents $ 145,259 $ 128,819 $ 148,865 Income taxes paid $ 88,253 $ 124,878 $ 97,309 Interest paid 25,910 19,465 20,975 Non-cash investing activities: Proceeds from sales of assets – notes receivable 35,616 24,497 — Acquisition-related liabilities (1) 3,011 5,855 27,441 (1) |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings per share | The following table reflects the calculation of basic and diluted earnings per share. During each period, certain stock options, as noted below, were excluded from the calculation of diluted earnings per share because their effect would have been antidilutive. (in thousands, except per share amounts) 2018 2017 2016 Earnings per share – basic: Net income $ 149,630 $ 230,155 $ 229,382 Income allocated to participating securities (617 ) (1,457 ) (1,870 ) Income available to common shareholders $ 149,013 $ 228,698 $ 227,512 Weighted-average shares outstanding 46,842 48,127 48,562 Earnings per share – basic $ 3.18 $ 4.75 $ 4.68 Earnings per share – diluted: Net income $ 149,630 $ 230,155 $ 229,382 Income allocated to participating securities (616 ) (1,450 ) (1,858 ) Re-measurement of share-based awards classified as liabilities (471 ) 59 296 Income available to common shareholders $ 148,543 $ 228,764 $ 227,820 Weighted-average shares outstanding 46,842 48,127 48,562 Dilutive impact of potential common shares 149 321 413 Weighted-average shares and potential common shares outstanding 46,991 48,448 48,975 Earnings per share – diluted $ 3.16 $ 4.72 $ 4.65 Antidilutive options excluded from calculation 1,209 262 214 |
Other comprehensive (loss) in_2
Other comprehensive (loss) income (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Reclassification adjustments | Information regarding amounts reclassified from accumulated other comprehensive loss to net income was as follows: Accumulated other comprehensive loss components Amounts reclassified from accumulated other comprehensive loss Affected line item in consolidated statements of income (in thousands) 2018 2017 2016 Amortization of postretirement benefit plan items: Prior service credit $ 1,421 $ 1,421 $ 1,421 Other income Net actuarial loss (2,884 ) (3,637 ) (3,797 ) Other income Total amortization (1,463 ) (2,216 ) (2,376 ) Other income Tax benefit 491 372 724 Income tax provision Total reclassifications, net of tax $ (972 ) $ (1,844 ) $ (1,652 ) Net income |
Accumulated other comprehensive loss | Accumulated other comprehensive loss – Changes in the components of accumulated other comprehensive loss were as follows for the years ended December 31: (in thousands) Postretirement benefit plans, net of tax Net unrealized loss on marketable debt securities, net of tax Currency translation adjustment Accumulated other comprehensive loss Balance, December 31, 2015 $ (38,822 ) $ (114 ) $ (16,267 ) $ (55,203 ) Other comprehensive income (loss) before reclassifications 1,486 (99 ) 1,793 3,180 Amounts reclassified from accumulated other comprehensive loss 1,652 — — 1,652 Net current-period other comprehensive income (loss) 3,138 (99 ) 1,793 4,832 Balance, December 31, 2016 (35,684 ) (213 ) (14,474 ) (50,371 ) Other comprehensive income (loss) before reclassifications 7,011 (109 ) 4,028 10,930 Amounts reclassified from accumulated other comprehensive loss 1,844 — — 1,844 Net current-period other comprehensive income (loss) 8,855 (109 ) 4,028 12,774 Balance, December 31, 2017 (26,829 ) (322 ) (10,446 ) (37,597 ) Other comprehensive loss before reclassifications (3,805 ) (1 ) (9,281 ) (13,087 ) Amounts reclassified from accumulated other comprehensive loss 972 — — 972 Net current-period other comprehensive loss (2,833 ) (1 ) (9,281 ) (12,115 ) Adoption of ASU No. 2018-02 (Note 2) (6,867 ) — — (6,867 ) Balance, December 31, 2018 $ (36,529 ) $ (323 ) $ (19,727 ) $ (56,579 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Acquisitions [Line Items] | |
Purchase price allocation | The following illustrates the allocation of the aggregate purchase price for the above acquisitions to the assets acquired and liabilities assumed: (in thousands) 2018 acquisitions (1) 2017 acquisitions (2) 2016 acquisitions (3) Net tangible assets acquired and liabilities assumed (4) $ 9,366 $ (1,956 ) $ (8,804 ) Identifiable intangible assets: Customer lists/relationships 59,587 58,620 116,491 Trade names 14,700 10,000 3,800 Software to be sold — 2,200 6,200 Technology-based intangibles 7,500 800 31,000 Internal-use software — 1,445 10,450 Total intangible assets 81,787 73,065 167,941 Goodwill 105,907 63,941 127,197 Total aggregate purchase price 197,060 135,050 286,334 Liabilities for holdback payments and contingent consideration (5) (3,011 ) (5,980 ) (27,441 ) Non-cash consideration (6) (1,060 ) — (2,020 ) Net cash paid for current year acquisitions 192,989 129,070 256,873 Measurement-period adjustment for 2015 acquisition (7) — — (18,743 ) Holdback payments for prior year acquisitions 21,269 10,153 1,534 Payments for acquisitions, net of cash acquired (8) $ 214,258 $ 139,223 $ 239,664 (1) Net tangible assets acquired and liabilities assumed for 2018 consisted primarily of REMITCO accounts receivable and Logomix deferred income tax liabilities. (2) Net tangible assets acquired and liabilities assumed for 2017 consisted primarily of accounts receivable, marketable securities, inventory and accrued liabilities of RDM and Digital Pacific. Amounts include measurement-period adjustments recorded in 2018 for the finalization of purchase accounting for several of the 2017 acquisitions. These adjustments increased goodwill $4,183 , with the offset to various assets and liabilities, including deferred revenue, deferred income taxes and other long-term liabilities, as well as a decrease of $1,654 in customer list intangibles and an increase in internal-use software of $1,000 . (3) Net tangible assets acquired and liabilities assumed for 2016 included customer funds obligations of $12,532 related to the acquisition of Payce, Inc., as well as accounts receivable, revenue in excess of billings and accounts payable of FMCG. Amounts include measurement-period adjustments recorded in 2017 for the finalization of purchase accounting for several of the 2016 acquisitions. These adjustments decreased goodwill $2,130 , with the offset to various assets and liabilities, including other current assets, accounts payable and intangibles, including an increase of $3,000 in acquired technology-based intangibles and a decrease of $1,924 in customer list intangibles. (4) Net tangible assets acquired included trade accounts receivable of $11,564 during 2018 , $4,544 during 2017 and $8,065 during 2016 . (5) Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 8. (6) Consists of pre-acquisition amounts owed to us by certain of the acquired businesses. (7) Reflects a measurement-period adjustment recorded in 2016 for funds held for customers of FISC Solutions, which was acquired in December 2015. Cash and cash equivalents included in funds held for customers are presented as restricted cash and restricted cash equivalents in the consolidated statements of cash flows. (8) Cash and cash equivalents acquired were $1,645 during 2018 , $27,299 during 2017 and $146 during 2016 |
First Manhattan Consulting Group, LLC [Member] | |
Acquisitions [Line Items] | |
Purchase price allocation | The allocation of the purchase price to the assets acquired and liabilities assumed for the FMCG acquisition was as follows: (in thousands) FMCG Net tangible assets acquired and liabilities assumed (1) $ 4,334 Identifiable intangible assets: Customer list/relationships 53,000 Technology-based intangible 31,000 Trade name 3,000 Total intangible assets (2) 87,000 Goodwill 110,219 Total aggregate purchase price 201,553 Liability for holdback payments (16,000 ) Payment for acquisition, net of cash acquired $ 185,553 (1) Net tangible assets acquired consisted primarily of accounts receivable, revenue in excess of billings and accounts payable outstanding as of the date of acquisition. (2) The useful lives of the acquired intangible assets were as follows: customer list/relationships – 7 years; technology-based intangible – 5 years; and trade name – 4 |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Nonrecurring fair value measurements | Information regarding these other nonrecurring asset impairment analyses was as follows: Fair value measurements using Fair value as of measurement date Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Asset impairment charge (in thousands) (Level 1) (Level 2) (Level 3) 2018 analyses: Customer list (Small Business Services) $ — $ — $ — $ — $ 2,149 Customer lists (Financial Services) (1) 4,223 — — 4,223 1,882 Total $ 4,031 2017 analyses: Trade name $ — $ — $ — $ — $ 14,752 Assets held for sale 3,500 — — 3,500 8,250 Other — — — — 3,499 Total $ 26,501 (1) The fair value presented is for the entire asset group that includes the impaired customer lists. |
Change in accrued contingent consideration | Changes in accrued contingent consideration were as follows: (in thousands) 2018 2017 2016 Balance, beginning of year $ 3,623 $ 4,682 $ 5,861 Acquisition date fair value 100 — 1,132 Change in fair value 610 1,190 (1,174 ) Payments (1,937 ) (2,249 ) (1,137 ) Balance, end of year $ 2,396 $ 3,623 $ 4,682 |
Gain (loss) from derivative instruments | The swaps met the criteria for using the short-cut method for a fair value hedge based on the structure of the hedging relationship. As such, changes in the fair value of the derivative and the related long-term debt were equal and were as follows for the year ended December 31, 2016: (in thousands) 2016 Gain from derivatives $ 1,200 Loss from change in fair value of hedged debt (1,200 ) Net effect on interest expense $ — |
Fair value of financial instruments | Information regarding the fair values of our financial instruments was as follows: Fair value measurements using December 31, 2018 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs (in thousands) Carrying value Fair value (Level 1) (Level 2) (Level 3) Measured at fair value through net income: Accrued contingent consideration $ (2,396 ) $ (2,396 ) $ — $ — $ (2,396 ) Measured at fair value through comprehensive income: Cash equivalents (funds held for customers) 16,000 16,000 16,000 — — Available-for-sale debt securities (funds held for customers) 15,463 15,463 — 15,463 — Amortized cost: Cash 59,740 59,740 59,740 — — Cash (funds held for customers) 69,519 69,519 69,519 — — Loans and notes receivable from Safeguard distributors 81,560 60,795 — — 60,795 Long-term debt (1) 910,000 910,000 — 910,000 — (1) Amounts exclude capital lease obligations. Fair value measurements using December 31, 2017 Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs (in thousands) Carrying value Fair value (Level 1) (Level 2) (Level 3) Measured at fair value through net income: Accrued contingent consideration $ (3,623 ) $ (3,623 ) $ — $ — $ (3,623 ) Measured at fair value through comprehensive income: Cash equivalents (funds held for customers) 17,300 17,300 17,300 — — Available-for-sale debt securities (funds held for customers) 16,613 16,613 — 16,613 — Amortized cost: Cash 59,240 59,240 59,240 — — Cash (funds held for customers) 52,279 52,279 52,279 — — Loans and notes receivable from Safeguard distributors 46,409 44,650 — — 44,650 Long-term debt (1) 707,386 707,938 — 707,938 — (1) |
Restructuring and integration_2
Restructuring and integration expense (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and integration expense by type and income statement category | Net restructuring and integration expense for the years ended December 31 consisted of the following components: (dollars in thousands) 2018 2017 2016 Severance accruals $ 7,672 $ 7,843 $ 7,217 Severance reversals (1,898 ) (667 ) (864 ) Operating lease obligations 597 23 59 Operating lease reversals (71 ) — — Net accruals 6,300 7,199 6,412 Other costs 14,903 1,931 1,359 Restructuring and integration expense $ 21,203 $ 9,130 $ 7,771 Number of employees included in severance accruals 205 200 265 Net restructuring and integration expense for the years ended December 31 is reflected in the consolidated statements of income as follows: (in thousands) 2018 2017 2016 Total cost of revenue $ 1,466 $ 568 $ 647 Operating expenses 19,737 8,562 7,124 Restructuring and integration expense $ 21,203 $ 9,130 $ 7,771 |
Restructuring and integration accruals, initiatives summarized by year | Restructuring and integration accruals, summarized by year, were as follows: (in thousands) 2018 initiatives 2017 initiatives 2016 initiatives 2014 & 2015 initiatives Total Balance, December 31, 2015 $ — $ — $ — $ 3,864 $ 3,864 Charges — — 7,198 78 7,276 Reversals — — (281 ) (583 ) (864 ) Payments — — (2,816 ) (3,279 ) (6,095 ) Balance, December 31, 2016 — — 4,101 80 4,181 Charges — 7,222 603 41 7,866 Reversals — (161 ) (464 ) (42 ) (667 ) Payments — (2,713 ) (4,208 ) (79 ) (7,000 ) Balance, December 31, 2017 — 4,348 32 — 4,380 Charges 8,136 133 — — 8,269 Reversals (1,412 ) (552 ) (5 ) — (1,969 ) Payments (3,276 ) (3,916 ) (27 ) — (7,219 ) Balance, December 31, 2018 $ 3,448 $ 13 $ — $ — $ 3,461 Cumulative amounts: Charges $ 8,136 $ 7,355 $ 7,801 $ 14,488 $ 37,780 Reversals (1,412 ) (713 ) (750 ) (2,416 ) (5,291 ) Payments (3,276 ) (6,629 ) (7,051 ) (12,072 ) (29,028 ) Balance, December 31, 2018 $ 3,448 $ 13 $ — $ — $ 3,461 |
Restructuring and integration accruals, by segment | The components of our restructuring and integration accruals, by segment, were as follows: Employee severance benefits Operating lease obligations (in thousands) Small Business Services Financial Services Direct Checks Corporate (1) Small Business Services Financial Services Total Balance, December 31, 2015 $ 1,023 $ 884 $ — $ 1,859 $ 56 $ 42 $ 3,864 Charges 2,634 1,937 143 2,503 59 — 7,276 Reversals (369 ) (64 ) (2 ) (429 ) — — (864 ) Payments (2,105 ) (1,416 ) (134 ) (2,283 ) (115 ) (42 ) (6,095 ) Balance, December 31, 2016 1,183 1,341 7 1,650 — — 4,181 Charges 2,032 2,168 143 3,500 23 — 7,866 Reversals (214 ) (93 ) (4 ) (356 ) — — (667 ) Payments (2,212 ) (2,018 ) (6 ) (2,745 ) (19 ) — (7,000 ) Balance, December 31, 2017 789 1,398 140 2,049 4 — 4,380 Charges 2,682 4,148 — 842 306 291 8,269 Reversals (530 ) (1,200 ) (5 ) (163 ) — (71 ) (1,969 ) Payments (1,615 ) (2,949 ) (135 ) (2,272 ) (28 ) (220 ) (7,219 ) Balance, December 31, 2018 $ 1,326 $ 1,397 $ — $ 456 $ 282 $ — $ 3,461 Cumulative amounts (2) : Charges $ 13,073 $ 12,512 $ 322 $ 10,856 $ 673 $ 344 $ 37,780 Reversals (2,313 ) (1,668 ) (13 ) (1,226 ) — (71 ) (5,291 ) Inter-segment transfer 41 (14 ) — (27 ) — — — Payments (9,475 ) (9,433 ) (309 ) (9,147 ) (391 ) (273 ) (29,028 ) Balance, December 31, 2018 $ 1,326 $ 1,397 $ — $ 456 $ 282 $ — $ 3,461 (1) As discussed in Note 18, corporate costs are allocated to our business segments. As such, the net corporate charges are reflected in the business segment operating income presented in Note 18 in accordance with our allocation methodology. (2) |
Income tax provision (Tables)
Income tax provision (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income before income taxes | Income before income taxes was comprised of the following for the years ended December 31: (in thousands) 2018 2017 2016 United States $ 198,727 $ 299,424 $ 325,396 Foreign 13,904 13,403 14,990 Income before income taxes $ 212,631 $ 312,827 $ 340,386 |
Components of income tax provision | The components of the income tax provision were as follows for the years ended December 31: (in thousands) 2018 2017 2016 Current tax provision: Federal $ 57,117 $ 104,079 $ 93,261 State 11,319 12,996 12,006 Foreign 5,921 4,774 3,851 Total current tax provision 74,357 121,849 109,118 Deferred tax provision: Federal (7,220 ) (37,471 ) 1,752 State (1,701 ) (491 ) 462 Foreign (2,435 ) (1,215 ) (328 ) Total deferred tax provision (11,356 ) (39,177 ) 1,886 Income tax provision $ 63,001 $ 82,672 $ 111,004 |
Effective tax rate reconciliation | The effective tax rate on pre-tax income reconciles to the United States federal statutory tax rate for the years ended December 31 as follows: 2018 2017 2016 Income tax at federal statutory rate 21.0 % 35.0 % 35.0 % Goodwill impairment charge 7.1 % 1.5 % — State income tax expense, net of federal income tax benefit 3.0 % 2.7 % 2.4 % Impact of Tax Cuts and Jobs Act (0.8 %) (6.6 %) — Qualified production activities deduction — (3.2 %) (2.8 %) Net tax benefit of share-based compensation (0.8 %) (1.6 %) (1.2 %) Other 0.1 % (1.4 %) (0.8 %) Effective tax rate 29.6 % 26.4 % 32.6 % |
Rollforward of unrecognized tax benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding accrued interest and penalties and the federal benefit of deductible state income tax, is as follows: (in thousands) 2018 2017 2016 Balance, beginning of year $ 3,795 $ 7,373 $ 5,743 Additions for tax positions of current year 315 378 521 Additions for tax positions of prior years 1,177 659 1,428 Reductions for tax positions of prior years (108 ) (4,389 ) (177 ) Lapse of statutes of limitations (378 ) (226 ) (142 ) Balance, end of year $ 4,801 $ 3,795 $ 7,373 |
Deferred tax assets and liabilities | Tax-effected temporary differences that gave rise to deferred tax assets and liabilities as of December 31 were as follows: 2018 2017 (in thousands) Deferred tax assets Deferred tax liabilities Deferred tax assets Deferred tax liabilities Goodwill $ — $ 47,993 $ — $ 45,317 Intangible assets — 3,780 — 7,490 Prepaid assets — 3,469 — 3,137 Installment sales treatment of notes receivable — 3,054 — 2,450 Deferred advertising costs — 1,948 — 1,920 Property, plant and equipment — 1,739 — 8,122 Net operating loss, capital loss and tax credit carryforwards 9,380 — 11,802 — Reserves and accruals 8,893 — 6,151 — Inventories 2,043 — 2,110 — All other 4,657 5,095 3,895 3,119 Total deferred taxes 24,973 67,078 23,958 71,555 Valuation allowances (1,689 ) — (1,518 ) — Net deferred taxes $ 23,284 $ 67,078 $ 22,440 $ 71,555 |
Share-based compensation plans
Share-based compensation plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based Compensation [Abstract] | |
Share-based compensation expense | The following amounts were recognized in our consolidated statements of income for share-based compensation awards for the years ended December 31: (in thousands) 2018 2017 2016 Restricted shares and restricted stock units $ 5,232 $ 6,533 $ 5,786 Performance share awards 4,502 4,782 2,806 Stock options 3,143 3,270 3,401 Employee stock purchase plan 501 524 466 Total share-based compensation expense $ 13,378 $ 15,109 $ 12,459 Income tax benefit $ (3,946 ) $ (5,152 ) $ (4,063 ) |
Weighted-average assumptions used in Black-Scholes option pricing model | The following weighted-average assumptions were used in the Black-Scholes option pricing model in determining the fair value of stock options granted: 2018 2017 2016 Risk-free interest rate 2.7 % 1.6 % 1.1 % Dividend yield 2.0 % 1.6 % 2.2 % Expected volatility 23.0 % 23.7 % 25.5 % Weighted-average option life (in years) 3.9 3.7 4.0 |
Stock options rollforward | Information regarding options issued under the current and all previous plans was as follows: Number of options (in thousands) Weighted-average exercise price per option Aggregate intrinsic value (in thousands) Weighted-average remaining contractual term (in years) Outstanding, December 31, 2015 1,354 $ 40.11 Granted 458 54.44 Exercised (476 ) 30.80 Forfeited or expired (85 ) 58.06 Outstanding, December 31, 2016 1,251 47.68 Granted 270 75.30 Exercised (347 ) 38.72 Forfeited or expired (35 ) 62.19 Outstanding, December 31, 2017 1,139 56.51 Granted 519 62.12 Exercised (339 ) 42.55 Forfeited or expired (74 ) 66.85 Outstanding, December 31, 2018 1,245 62.04 $ 127 5.0 Exercisable at December 31, 2016 624 $ 38.50 Exercisable at December 31, 2017 555 47.42 Exercisable at December 31, 2018 472 59.90 $ 127 3.5 |
Restricted stock units rollforward | Information regarding our restricted stock units was as follows: Number of units (in thousands) Weighted-average grant date fair value per unit Weighted-average remaining contractual term (in years) Outstanding at December 31, 2015 167 $ 34.74 Granted 38 55.39 Vested (46 ) 40.15 Forfeited (20 ) 58.69 Outstanding at December 31, 2016 139 37.99 Granted 16 73.27 Vested (43 ) 43.18 Forfeited (3 ) 57.18 Outstanding at December 31, 2017 109 38.31 Granted 110 52.32 Vested (22 ) 48.14 Forfeited (2 ) 74.96 Outstanding at December 31, 2018 195 45.41 3.3 |
Restricted shares rollforward | Information regarding unvested restricted shares was as follows: Number of shares (in thousands) Weighted-average grant date fair value per share Weighted-average remaining contractual term (in years) Unvested at December 31, 2015 170 $ 56.35 Granted 97 56.22 Vested (22 ) 56.63 Forfeited (25 ) 56.86 Unvested at December 31, 2016 220 56.43 Granted 68 74.84 Vested (99 ) 52.41 Forfeited (8 ) 61.37 Unvested at December 31, 2017 181 65.33 Granted 77 71.29 Vested (76 ) 69.73 Forfeited (14 ) 66.24 Unvested at December 31, 2018 168 66.02 1.1 |
Weighted-average assumptions used in Monte Carlo simulation pricing model, performance share awards | The following weighted-average assumptions were used in the Monte Carlo simulation model in determining the fair value of market-based performance shares granted: 2018 2017 2016 Risk-free interest rate 2.4 % 1.4 % 0.9 % Dividend yield 1.6 % 1.7 % 2.3 % Expected volatility 21.6 % 21.9 % 22.7 % |
Performance share awards rollforward | Information regarding unvested performance shares was as follows: Performance shares (in thousands) Weighted-average grant date fair value per share Weighted-average remaining contractual term (in years) Unvested at December 31, 2015 122 $ 58.13 Granted (1) 153 52.75 Forfeited (39 ) 55.04 Unvested at December 31, 2016 236 55.15 Granted (1) 83 75.31 Forfeited (9 ) 64.85 Vested (60 ) 50.17 Adjustment for performance results achieved (2) 5 50.34 Unvested at December 31, 2017 255 63.42 Granted (1) 91 74.49 Forfeited (48 ) 59.32 Vested (45 ) 67.10 Adjustment for performance results achieved (2) (3 ) 67.11 Unvested at December 31, 2018 250 67.54 1.1 (1) Reflects awards granted assuming achievement of performance goals at target. (2) |
Employee compensation plans (Ta
Employee compensation plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Compensation Related Costs [Abstract] | |
Expense recognized for employee compensation plans | Expense recognized in the consolidated statements of income for these plans was as follows for the years ended December 31: (in thousands) 2018 2017 2016 Performance-based compensation plans (1) $ 20,297 $ 22,085 $ 19,730 401(k) expense 9,686 9,023 8,309 (1) |
Postretirement benefits (Tables
Postretirement benefits (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Defined Benefit Plan [Abstract] | |
Change in benefit obligation, plan assets and funded status | The following tables summarize the change in benefit obligation, plan assets and funded status during 2018 and 2017 : (in thousands) Postretirement benefit plan Pension plan (1) Change in benefit obligation: Benefit obligation, December 31, 2016 $ 94,188 $ 3,447 Interest cost 2,794 101 Net actuarial (gain) loss (1,469 ) 174 Benefits paid from plan assets and company funds (7,919 ) (324 ) Benefit obligation, December 31, 2017 87,594 3,398 Interest cost 2,529 97 Net actuarial gain (9,231 ) (23 ) Benefits paid from plan assets and company funds (7,175 ) (324 ) Benefit obligation, December 31, 2018 $ 73,717 $ 3,148 Change in plan assets: Fair value of plan assets, December 31, 2016 $ 118,128 $ — Return on plan assets 15,309 — Benefits paid (5,994 ) — Fair value of plan assets, December 31, 2017 127,443 — Return on plan assets (6,663 ) — Benefits paid (5,804 ) — Fair value of plan assets, December 31, 2018 $ 114,976 $ — Funded status, December 31, 2017 $ 39,849 $ (3,398 ) Funded status, December 31, 2018 $ 41,259 $ (3,148 ) |
Amounts recognized in consolidated balance sheets | The funded status of our plans was recognized in the consolidated balance sheets as of December 31 as follows: Postretirement benefit plan Pension plan (in thousands) 2018 2017 2018 2017 Other non-current assets $ 41,259 $ 39,849 $ — $ — Accrued liabilities — — 324 324 Other non-current liabilities — — 2,824 3,074 |
Amounts included in other comprehensive loss that have not been recognized as components of postretirement benefit income | Amounts included in accumulated other comprehensive loss as of December 31 that have not been recognized as components of postretirement benefit income were as follows: (in thousands) 2018 2017 Unrecognized prior service credit $ 14,178 $ 15,599 Unrecognized net actuarial loss (57,436 ) (55,174 ) Tax effect 6,729 12,746 Amount recognized in accumulated other comprehensive loss, net of tax $ (36,529 ) $ (26,829 ) |
Components of net periodic benefit income | Postretirement benefit income for the years ended December 31 consisted of the following components: (in thousands) 2018 2017 2016 Interest cost $ 2,626 $ 2,896 $ 3,118 Expected return on plan assets (7,737 ) (7,128 ) (7,335 ) Amortization of prior service credit (1,421 ) (1,421 ) (1,421 ) Amortization of net actuarial losses 2,884 3,637 3,797 Net periodic benefit income $ (3,648 ) $ (2,016 ) $ (1,841 ) |
Actuarial assumptions used in measuring benefit obligation and net periodic benefit income | In measuring benefit obligations as of December 31, the following discount rate assumptions were used: Postretirement benefit plan Pension plan 2018 2017 2018 2017 Discount rate 4.13 % 3.46 % 4.01 % 3.35 % In measuring net periodic benefit income for the years ended December 31, the following assumptions were used: Postretirement benefit plan Pension plan 2018 2017 2016 2018 2017 2016 Discount rate 3.46 % 3.81 % 4.02 % 3.35 % 3.66 % 3.88 % Expected return on plan assets 6.25 % 6.25 % 6.50 % — — — |
Health care cost trend rate assumptions | In measuring benefit obligations as of December 31 for our postretirement benefit plan, the following assumptions for health care cost trend rates were used: 2018 2017 2016 Participants under age 65 Participants age 65 and older Participants under age 65 Participants age 65 and older Participants under age 65 Participants age 65 and older Health care cost trend rate assumed for next year 7.70 % 8.70 % 7.90 % 9.10 % 7.50 % 8.75 % Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) 4.50 % 4.50 % 4.50 % 4.50 % 4.50 % 4.50 % Year that the rate reaches the ultimate trend rate 2029 2029 2025 2025 2025 2025 |
Allocation of plan assets by asset category | The allocation of plan assets by asset category as of December 31 was as follows: Postretirement benefit plan 2018 2017 Mortgage-backed securities 25 % 23 % U.S. large capitalization equity securities 23 % 24 % U.S. corporate debt securities 20 % 18 % International equity securities 18 % 18 % Government debt securities 11 % 13 % U.S. small and mid-capitalization equity securities 3 % 4 % Total 100 % 100 % Our postretirement benefit plan has assets that are intended to meet long-term obligations. In order to meet these obligations, we employ a total return investment approach that considers cash flow needs and balances long-term projected returns against expected asset risk, as measured using projected standard deviations. Risk tolerance is established through consideration of projected plan liabilities, the plan's funded status, projected liquidity needs and current corporate financial condition. The target asset allocation percentages for our postretirement benefit plan are based on our liability and asset projections. The targeted allocation of plan assets is 55% fixed income securities, 24% large capitalization equity securities, 18% international equity securities and 3% small and mid-capitalization equity securities. Information regarding fair value measurements of plan assets was as follows as of December 31, 2018 : Fair value measurements using Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Investments measured at net asset value Fair value as of December 31, 2018 (in thousands) (Level 1) (Level 2) (Level 3) Mortgage-backed securities $ — $ 13,593 $ — $ 15,138 $ 28,731 U.S. large capitalization equity securities — — — 26,240 26,240 U.S. corporate debt securities 6,489 12,468 — 3,594 22,551 International equity securities 20,261 298 — — 20,559 Government debt securities — 12,738 — — 12,738 U.S. small and mid-capitalization equity securities 3,259 27 — 551 3,837 Other debt securities (6 ) 326 — — 320 Plan assets $ 30,003 $ 39,450 $ — $ 45,523 $ 114,976 Information regarding fair value measurements of plan assets was as follows as of December 31, 2017 : Fair value measurements using Quoted prices in active markets for identical assets Significant other observable inputs Significant unobservable inputs Investments measured at net asset value Fair value as of December 31, 2017 (in thousands) (Level 1) (Level 2) (Level 3) Mortgage-backed securities $ — $ 13,274 $ — $ 15,388 $ 28,662 U.S. large capitalization equity securities — — — 30,167 30,167 U.S. corporate debt securities — 13,032 — 10,206 23,238 International equity securities 23,127 340 — — 23,467 Government debt securities — 17,118 — — 17,118 U.S. small and mid-capitalization equity securities 3,490 56 — 956 4,502 Other debt securities 134 155 — — 289 Plan assets $ 26,751 $ 43,975 $ — $ 56,717 $ 127,443 |
Expected benefit payments | The following benefit payments are expected to be paid during the years indicated: (in thousands) Postretirement benefit plan Pension plan 2019 $ 7,679 $ 320 2020 7,906 320 2021 7,730 310 2022 7,219 300 2023 6,686 300 2024 - 2028 26,205 1,320 |
Debt and lease obligations (Tab
Debt and lease obligations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt and lease obligations [Abstract] | |
Debt outstanding | Debt outstanding was comprised of the following at December 31: (in thousands) 2018 2017 Amount drawn on revolving credit facility $ 910,000 $ 413,000 Amount outstanding under term loan facility — 294,938 Capital lease obligations 1,864 1,914 Long-term debt, principal amount 911,864 709,852 Less unamortized debt issuance costs — (471 ) Less current portion of long-term debt (791 ) (44,121 ) Long-term debt 911,073 665,260 Current portion of amount drawn under term loan facility — 43,313 Current portion of capital lease obligations 791 808 Long-term debt due within one year, principal amount 791 44,121 Less unamortized debt issuance costs — (81 ) Long-term debt due within one year 791 44,040 Total debt $ 911,864 $ 709,300 |
Credit facility | Daily average amounts outstanding under our credit facility were as follows for the years ended December 31: (in thousands) 2018 2017 2016 Revolving credit facility: Daily average amount outstanding $ 731,110 $ 436,588 $ 417,219 Weighted-average interest rate 3.24 % 2.55 % 1.93 % Term loan facility: Daily average amount outstanding $ 63,638 $ 315,862 $ 52,381 Weighted-average interest rate 2.97 % 2.57 % 1.52 % As of December 31, 2018 , amounts were available for borrowing under our revolving credit facility as follows: (in thousands) Total available Revolving credit facility commitment (1) $ 950,000 Amount drawn on revolving credit facility (910,000 ) Outstanding letters of credit (2) (10,221 ) Net available for borrowing as of December 31, 2018 $ 29,779 (1) In January 2019, we increased the credit facility by $200,000 , bringing the total availability to $1,150,000 . (2) |
Leased assets, capital leases | The balance of those leased assets placed in service as of December 31 was as follows: (in thousands) 2018 2017 Machinery and equipment $ 6,413 $ 4,676 Accumulated depreciation (4,673 ) (3,522 ) Net assets under capital leases $ 1,740 $ 1,154 |
Future minimum lease payments due under capital and noncancelable operating leases | As of December 31, 2018 , future minimum lease payments under our capital lease obligations and noncancelable operating leases with terms in excess of one year were as follows: (in thousands) Capital lease obligations Operating lease obligations 2019 $ 822 $ 16,479 2020 637 13,240 2021 365 9,001 2022 91 5,792 2023 — 3,263 Thereafter — 11,056 Total minimum lease payments 1,915 $ 58,831 Less portion representing interest (51 ) Present value of minimum lease payments $ 1,864 |
Business segment information (T
Business segment information (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Revenue disaggregated by product and service offerings | The following tables present revenue disaggregated by our product and service offerings: Year Ended December 31, 2018 (in thousands) Small Business Services Financial Services Direct Checks Consolidated Marketing solutions and other services: Small business marketing solutions $ 292,245 $ — $ — $ 292,245 Web services 161,646 — — 161,646 Data-driven marketing solutions — 147,893 — 147,893 Treasury management solutions — 148,011 — 148,011 Fraud, security, risk management and operational services 25,460 50,499 14,146 90,105 Total MOS 479,351 346,403 14,146 839,900 Checks 476,751 — 226,554 107,084 810,389 Forms, accessories and other products 327,518 14,010 6,208 347,736 Total revenue $ 1,283,620 $ 586,967 $ 127,438 $ 1,998,025 Year Ended December 31, 2017 (in thousands) Small Business Services Financial Services Direct Checks Consolidated Marketing solutions and other services: Small business marketing solutions $ 262,192 $ — $ — $ 262,192 Web services 131,644 — — 131,644 Data-driven marketing solutions — 150,572 — 150,572 Treasury management solutions — 109,240 — 109,240 Fraud, security, risk management and operational services 25,491 61,185 15,354 102,030 Total MOS 419,327 320,997 15,354 755,678 Checks 482,928 249,716 118,392 851,036 Forms, accessories and other products 337,484 14,562 6,796 358,842 Total revenue $ 1,239,739 $ 585,275 $ 140,542 $ 1,965,556 Year Ended December 31, 2016 (in thousands) Small Business Services Financial Services Direct Checks Consolidated Marketing solutions and other services: Small business marketing solutions $ 242,710 $ — $ — $ 242,710 Web services 115,226 — — 115,226 Data-driven marketing solutions — 50,022 — 50,022 Treasury management solutions — 92,259 — 92,259 Fraud, security, risk management and operational services 26,948 72,940 16,812 116,700 Total MOS 384,884 215,221 16,812 616,917 Checks 467,386 268,926 128,973 865,285 Forms, accessories and other products 343,473 15,829 7,558 366,860 Total revenue $ 1,195,743 $ 499,976 $ 153,343 $ 1,849,062 |
Revenue disaggregated by geographic area | The following table presents revenue disaggregated by geography, based on where items are shipped or services are performed: (in thousands) Small Business Services Financial Services Direct Checks Total Year Ended December 31, 2018 United States $ 1,180,019 $ 563,918 $ 127,438 $ 1,871,375 Foreign, primarily Canada and Australia 103,601 23,049 — 126,650 Total revenue $ 1,283,620 $ 586,967 $ 127,438 $ 1,998,025 Year Ended December 31, 2017 United States $ 1,150,055 $ 568,801 $ 140,542 $ 1,859,398 Foreign, primarily Canada and Australia 89,684 16,474 — 106,158 Total revenue $ 1,239,739 $ 585,275 $ 140,542 $ 1,965,556 Year Ended December 31, 2016 United States $ 1,123,382 $ 499,976 $ 153,343 $ 1,776,701 Foreign, primarily Canada and Australia 72,361 — — 72,361 Total revenue $ 1,195,743 $ 499,976 $ 153,343 $ 1,849,062 |
Business segment information | The following is our segment information as of and for the years ended December 31: Reportable Business Segments (in thousands) Small Business Services Financial Services Direct Checks Corporate Consolidated Total revenue from external 2018 $ 1,283,620 $ 586,967 $ 127,438 $ — $ 1,998,025 customers: 2017 1,239,739 585,275 140,542 — 1,965,556 2016 1,195,743 499,976 153,343 — 1,849,062 Operating income: 2018 119,808 69,939 41,474 — 231,221 2017 181,528 101,047 46,601 — 329,176 2016 207,581 106,335 52,971 — 366,887 Depreciation and amortization 2018 66,031 61,843 3,226 — 131,100 expense: 2017 56,834 62,592 3,226 — 122,652 2016 52,195 35,850 3,538 — 91,583 Asset impairment charges: 2018 99,437 1,882 — — 101,319 2017 54,880 — — — 54,880 2016 — — — — — Total assets: 2018 1,094,262 751,242 157,802 301,790 2,305,096 2017 1,081,098 679,547 158,827 289,355 2,208,827 2016 1,086,500 631,353 161,039 305,446 2,184,338 Capital asset purchases: 2018 — — — 62,238 62,238 2017 — — — 47,450 47,450 2016 — — — 46,614 46,614 |
SUMMARIZED QUARTERLY FINANCIA_2
SUMMARIZED QUARTERLY FINANCIAL DATA (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data [Abstract] | |
Summarized Quarterly Financial Data | DELUXE CORPORATION SUMMARIZED QUARTERLY FINANCIAL DATA (Unaudited) (in thousands, except per share amounts) 2018 Quarter Ended March 31 June 30 September 30 December 31 Total revenue $ 491,914 $ 488,244 $ 493,190 $ 524,677 Gross profit 303,156 298,043 295,556 309,522 Net income (loss) 63,336 60,207 (31,083 ) 57,170 Earnings (loss) per share: Basic 1.32 1.26 (0.67 ) 1.25 Diluted 1.31 1.25 (0.67 ) 1.25 Cash dividends per share 0.30 0.30 0.30 0.30 2017 Quarter Ended March 31 June 30 September 30 December 31 Total revenue $ 487,766 $ 485,232 $ 497,669 $ 494,889 Gross profit 308,452 305,864 304,598 303,935 Net income 57,066 59,579 28,801 84,709 Earnings per share: Basic 1.17 1.23 0.60 1.76 Diluted 1.16 1.22 0.59 1.75 Cash dividends per share 0.30 0.30 0.30 0.30 Significant items affecting the comparability of quarterly results were as follows: 2018 Quarter Ended (in thousands) March 31 June 30 September 30 December 31 Asset impairment charges $ 2,149 $ — $ 99,170 $ — Restructuring and integration expense 2,322 6,371 5,104 7,406 Gain on sales of businesses and customer lists 7,228 3,862 1,765 2,786 Certain litigation 297 631 1,805 7,769 CEO transition costs — 1,530 2,622 3,058 Impact of the Tax Cuts and Jobs Act (310 ) 441 (1,249 ) (582 ) Other discrete income tax (benefit) expense (1) (579 ) (1,167 ) 15,634 (1,987 ) 2017 Quarter Ended March 31 June 30 September 30 December 31 Asset impairment charges $ 5,296 $ 2,954 $ 46,630 $ — Restructuring and integration expense 993 1,457 1,242 5,438 Gain on sales of businesses and customer lists 6,779 — 1,924 — Impact of the Tax Cuts and Jobs Act — — — (20,500 ) Other discrete income tax (benefit) expense (1) (3,664 ) (1,276 ) 4,555 (1,843 ) (1) |
Schedule of cash, cash equivalents, restricted cash and restricted cash equivalents | The revised total of cash, cash equivalents, restricted cash and restricted cash equivalents as of the end of each interim period in 2018 and 2017 is as follows: (in thousands) Cash, cash equivalents, restricted cash and restricted cash equivalents (unaudited) September 30, 2018 $ 126,114 June 30, 2018 145,303 March 31, 2018 146,479 September 30, 2017 115,172 June 30, 2017 105,479 March 31, 2017 160,000 |
Significant accounting polici_3
Significant accounting policies (cash and cash equivalents and trade accounts receivable) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash and cash equivalents | ||
Maximum maturity of cash equivalents | 3 months | |
Book overdrafts | $ 1,270 | $ 5,665 |
Trade accounts receivable | ||
Period for write-off of trade accounts receivable | 1 year |
Significant accounting polici_4
Significant accounting policies (property, plant and equipment) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Building [Member] | |
Property, plant and equipment [Line Items] | |
Useful life | 40 years |
Machinery and equipment [Member] | Minimum [Member] | |
Property, plant and equipment [Line Items] | |
Useful life | 1 year |
Machinery and equipment [Member] | Maximum [Member] | |
Property, plant and equipment [Line Items] | |
Useful life | 11 years |
Machinery and equipment [Member] | Weighted-average [Member] | |
Property, plant and equipment [Line Items] | |
Useful life | 7 years |
Significant accounting polici_5
Significant accounting policies (intangibles) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Minimum [Member] | |
Amortizable intangibles [Line Items] | |
Useful life | 1 year |
Maximum [Member] | |
Amortizable intangibles [Line Items] | |
Useful life | 14 years |
Weighted-average [Member] | |
Amortizable intangibles [Line Items] | |
Useful life | 6 years |
Significant accounting polici_6
Significant accounting policies (prepaid product discounts) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Minimum [Member] | |
Prepaid product discounts [Line Items] | |
Amortization period | 1 year |
Maximum [Member] | |
Prepaid product discounts [Line Items] | |
Amortization period | 10 years |
Weighted-average [Member] | |
Prepaid product discounts [Line Items] | |
Amortization period | 6 years |
Significant accounting polici_7
Significant accounting policies (advertising costs) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Advertising costs [Line Items] | |||
Advertising expense | $ 74,549 | $ 78,722 | $ 85,141 |
Maximum [Member] | |||
Advertising costs [Line Items] | |||
Deferred advertising costs amortization period | 18 months | ||
Reportable business segments [Member] | Small Business Services [Member] | |||
Advertising costs [Line Items] | |||
Deferred advertising costs amortization period | 6 months | ||
Reportable business segments [Member] | Direct Checks [Member] | |||
Advertising costs [Line Items] | |||
Percentage of deferred advertising costs expensed within six months | 88.00% |
Significant accounting polici_8
Significant accounting policies (income taxes, derivative financial instruments and revenue recognition) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income taxes | |||||||||||
Measurement of tax benefit, minimum percentage tax benefit must be likely to be realized | 50.00% | ||||||||||
Derivative financial instruments | |||||||||||
Net fair value of derivatives | $ 0 | $ 0 | $ 0 | $ 0 | |||||||
Total revenue | 524,677 | $ 493,190 | $ 488,244 | $ 491,914 | 494,889 | $ 497,669 | $ 485,232 | $ 487,766 | $ 1,998,025 | 1,965,556 | $ 1,849,062 |
Deferred revenue, period over which recognized | 1 year | ||||||||||
Increase in deferred revenue | $ 5,704 | ||||||||||
Deferred revenue recognized | 45,405 | ||||||||||
Contract asset | 19,705 | 7,387 | 19,705 | 7,387 | |||||||
Unbilled receivables | $ 10,753 | $ 8,992 | $ 10,753 | $ 8,992 | |||||||
Minimum [Member] | |||||||||||
Capitalized contract costs amortization period | 3 years | ||||||||||
Maximum [Member] | |||||||||||
Capitalized contract costs amortization period | 6 years | ||||||||||
Variable consideration [Member] | |||||||||||
Variable consideration, period over which finalized | 4 months | ||||||||||
Total revenue | $ 130,000 | ||||||||||
Data-driven marketing and treasury management solutions [Member] | Minimum [Member] | |||||||||||
Remaining performance obligations, expected timing of satisfaction | 3 months | 3 months | |||||||||
Data-driven marketing and treasury management solutions [Member] | Maximum [Member] | |||||||||||
Remaining performance obligations, expected timing of satisfaction | 1 year | 1 year |
Significant accounting polici_9
Significant accounting policies (employee share-based compensation) (Details) - Employee stock purchase plan [Member] | 12 Months Ended |
Dec. 31, 2018 | |
Share-based compensation plans [Line Items] | |
Employee stock purchase plan discount | 15.00% |
Purchase period | 6 months |
New accounting pronouncements_2
New accounting pronouncements (ASU No. 2014-09) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2018 | |
Revenue, effect of transition [Line Items] | ||||||||||||
Practical expedient, financing component | true | |||||||||||
Practical expedient, costs of obtaining contracts | true | |||||||||||
Revenue in excess of billings | $ 30,458 | $ 16,379 | $ 30,458 | $ 16,379 | ||||||||
Total current assets | 450,046 | 392,966 | 450,046 | 392,966 | ||||||||
Other non-current assets | 196,108 | 159,756 | 196,108 | 159,756 | ||||||||
Total assets | 2,305,096 | 2,208,827 | 2,305,096 | 2,208,827 | $ 2,184,338 | |||||||
Accrued liabilities | 284,281 | 277,253 | 284,281 | 277,253 | ||||||||
Total current liabilities | 392,050 | 425,770 | 392,050 | 425,770 | ||||||||
Deferred income taxes | 46,680 | 50,543 | 46,680 | 50,543 | ||||||||
Retained earnings | 927,345 | 1,004,657 | 927,345 | 1,004,657 | ||||||||
Toal liabilities and shareholders' equity | 2,305,096 | 2,208,827 | 2,305,096 | 2,208,827 | ||||||||
Total revenue | 524,677 | $ 493,190 | $ 488,244 | $ 491,914 | 494,889 | $ 497,669 | $ 485,232 | $ 487,766 | 1,998,025 | 1,965,556 | 1,849,062 | |
Total cost of revenue | (791,748) | (742,707) | (667,813) | |||||||||
Gross profit | 309,522 | 295,556 | 298,043 | 303,156 | 303,935 | 304,598 | 305,864 | 308,452 | 1,206,277 | 1,222,849 | 1,181,249 | |
Selling, general and administrative expense | (854,000) | (830,231) | (807,238) | |||||||||
Operating income | 231,221 | 329,176 | 366,887 | |||||||||
Income before income taxes | 212,631 | 312,827 | 340,386 | |||||||||
Income tax provision | (63,001) | (82,672) | (111,004) | |||||||||
Net income | 57,170 | $ (31,083) | $ 60,207 | $ 63,336 | 84,709 | $ 28,801 | $ 59,579 | $ 57,066 | 149,630 | 230,155 | 229,382 | |
Service [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Total revenue | 546,192 | 495,702 | 376,180 | |||||||||
Total cost of revenue | (244,108) | (213,069) | $ (132,907) | |||||||||
Effect of adoption [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Revenue in excess of billings | (1,052) | (1,052) | ||||||||||
Total current assets | (1,052) | (1,052) | ||||||||||
Other non-current assets | (6,482) | (6,482) | ||||||||||
Total assets | (7,534) | (7,534) | ||||||||||
Accrued liabilities | (209) | (209) | ||||||||||
Total current liabilities | (209) | (209) | ||||||||||
Deferred income taxes | (1,727) | (1,727) | ||||||||||
Retained earnings | (5,598) | (5,598) | ||||||||||
Toal liabilities and shareholders' equity | (7,534) | (7,534) | ||||||||||
Total revenue | (717) | |||||||||||
Total cost of revenue | 625 | |||||||||||
Gross profit | (92) | |||||||||||
Selling, general and administrative expense | (749) | |||||||||||
Operating income | (841) | |||||||||||
Income before income taxes | (841) | |||||||||||
Income tax provision | 209 | |||||||||||
Net income | (632) | |||||||||||
Effect of adoption [Member] | Service [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Total revenue | (717) | |||||||||||
Total cost of revenue | 625 | |||||||||||
Amounts without adoption of ASU No. 2014-09 [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Revenue in excess of billings | 29,406 | 29,406 | ||||||||||
Total current assets | 448,994 | 448,994 | ||||||||||
Other non-current assets | 189,626 | 189,626 | ||||||||||
Total assets | 2,297,562 | 2,297,562 | ||||||||||
Accrued liabilities | 284,072 | 284,072 | ||||||||||
Total current liabilities | 391,841 | 391,841 | ||||||||||
Deferred income taxes | 44,953 | 44,953 | ||||||||||
Retained earnings | 921,747 | 921,747 | ||||||||||
Toal liabilities and shareholders' equity | $ 2,297,562 | 2,297,562 | ||||||||||
Total revenue | 1,997,308 | |||||||||||
Total cost of revenue | (791,123) | |||||||||||
Gross profit | 1,206,185 | |||||||||||
Selling, general and administrative expense | (854,749) | |||||||||||
Operating income | 230,380 | |||||||||||
Income before income taxes | 211,790 | |||||||||||
Income tax provision | (62,792) | |||||||||||
Net income | 148,998 | |||||||||||
Amounts without adoption of ASU No. 2014-09 [Member] | Service [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Total revenue | 545,475 | |||||||||||
Total cost of revenue | $ (243,483) | |||||||||||
Accounting Standards Update No. 2014-09 [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Revenue in excess of billings | $ 17,339 | |||||||||||
Total current assets | 393,926 | |||||||||||
Other non-current assets | 165,489 | |||||||||||
Total assets | 2,215,520 | |||||||||||
Deferred income taxes | 52,270 | |||||||||||
Retained earnings | 1,009,623 | |||||||||||
Toal liabilities and shareholders' equity | $ 2,215,520 | |||||||||||
Cumulative effect of adoption | 4,966 | 4,966 | ||||||||||
Accounting Standards Update No. 2014-09 [Member] | Revenue in excess of billings [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Cumulative effect of adoption | 960 | 960 | ||||||||||
Accounting Standards Update No. 2014-09 [Member] | Total current assets [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Cumulative effect of adoption | 960 | 960 | ||||||||||
Accounting Standards Update No. 2014-09 [Member] | Other non-current assets [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Cumulative effect of adoption | 5,733 | 5,733 | ||||||||||
Accounting Standards Update No. 2014-09 [Member] | Total assets [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Cumulative effect of adoption | 6,693 | 6,693 | ||||||||||
Accounting Standards Update No. 2014-09 [Member] | Deferred income tax liabilities [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Cumulative effect of adoption | 1,727 | 1,727 | ||||||||||
Accounting Standards Update No. 2014-09 [Member] | Retained earnings [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Cumulative effect of adoption | 4,966 | 4,966 | ||||||||||
Accounting Standards Update No. 2014-09 [Member] | Total liabilities and shareholders' equity [Member] | ||||||||||||
Revenue, effect of transition [Line Items] | ||||||||||||
Cumulative effect of adoption | $ 6,693 | $ 6,693 |
New accounting pronouncements_3
New accounting pronouncements (other standards) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2019 | Jan. 01, 2018 | ||
Payments for acquisitions, net of cash acquired | [1] | $ (214,258) | $ (139,223) | $ (239,664) | |||||||||||
Purchases of customer funds marketable securities | (7,807) | (7,737) | (7,869) | ||||||||||||
Proceeds from customer funds and corporate marketable securities | 7,807 | 11,237 | 9,504 | ||||||||||||
Net cash used by investing activities | (275,414) | (180,891) | (279,511) | ||||||||||||
Net change in customer funds obligations | 20,279 | (6,007) | 1,723 | ||||||||||||
Net cash (used) provided by financing activities, | (39,825) | (182,956) | 5,998 | ||||||||||||
Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents | (7,636) | 5,370 | 2,363 | ||||||||||||
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | 16,440 | (20,046) | 48,162 | ||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year | $ 145,259 | $ 126,114 | $ 145,303 | $ 146,479 | $ 128,819 | $ 115,172 | $ 105,479 | $ 160,000 | $ 148,865 | 128,819 | 148,865 | 100,703 | |||
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) | 145,259 | 126,114 | 145,303 | 146,479 | 128,819 | 115,172 | 105,479 | 160,000 | 145,259 | 128,819 | 148,865 | ||||
Total cost of revenue | (791,748) | (742,707) | (667,813) | ||||||||||||
Gross profit | 309,522 | 295,556 | 298,043 | 303,156 | 303,935 | 304,598 | 305,864 | 308,452 | 1,206,277 | 1,222,849 | 1,181,249 | ||||
Selling, general and administrative expense | (854,000) | (830,231) | (807,238) | ||||||||||||
Operating income | 231,221 | 329,176 | 366,887 | ||||||||||||
Other income | 8,522 | 5,010 | 3,659 | ||||||||||||
Net income | 57,170 | (31,083) | 60,207 | 63,336 | 84,709 | 28,801 | 59,579 | 57,066 | 149,630 | 230,155 | 229,382 | ||||
Impact of Tax Cuts and Jobs Act | $ (582) | $ (1,249) | $ 441 | (310) | (20,500) | $ 0 | $ 0 | 0 | (1,700) | (20,500) | |||||
Retained earnings [Member] | |||||||||||||||
Net income | 149,630 | 230,155 | 229,382 | ||||||||||||
Product [Member] | |||||||||||||||
Total cost of revenue | (547,640) | (529,638) | (534,906) | ||||||||||||
Service [Member] | |||||||||||||||
Total cost of revenue | (244,108) | (213,069) | (132,907) | ||||||||||||
As previously reported [Member] | |||||||||||||||
Payments for acquisitions, net of cash acquired | (270,939) | ||||||||||||||
Purchases of customer funds marketable securities | 0 | 0 | |||||||||||||
Proceeds from customer funds and corporate marketable securities | 3,500 | 1,635 | |||||||||||||
Net cash used by investing activities | (180,891) | (310,786) | |||||||||||||
Net change in customer funds obligations | 0 | 0 | |||||||||||||
Net cash (used) provided by financing activities, | (176,949) | 4,275 | |||||||||||||
Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents | 2,075 | 1,346 | |||||||||||||
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | (17,334) | 14,147 | |||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year | 59,240 | 76,574 | 59,240 | 76,574 | 62,427 | ||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) | 59,240 | 59,240 | 76,574 | ||||||||||||
Total cost of revenue | (742,090) | (667,241) | |||||||||||||
Gross profit | 1,223,466 | 1,181,821 | |||||||||||||
Selling, general and administrative expense | (828,832) | (805,970) | |||||||||||||
Operating income | 331,192 | 368,727 | |||||||||||||
Other income | 2,994 | 1,819 | |||||||||||||
Net income | 230,155 | 229,382 | |||||||||||||
As previously reported [Member] | Product [Member] | |||||||||||||||
Total cost of revenue | (529,088) | (534,390) | |||||||||||||
As previously reported [Member] | Service [Member] | |||||||||||||||
Total cost of revenue | (213,002) | (132,851) | |||||||||||||
Accounting Standards Update No. 2016-01 [Member] | |||||||||||||||
Effect of adoption | 0 | ||||||||||||||
Accounting Standards Update No. 2016-16 [Member] | Retained earnings [Member] | |||||||||||||||
Cumulative effect of adoption | $ 0 | ||||||||||||||
Accounting Standards Update No. 2016-18 [Member] | Effect of adoption [Member] | |||||||||||||||
Payments for acquisitions, net of cash acquired | 31,275 | ||||||||||||||
Purchases of customer funds marketable securities | (7,737) | (7,869) | |||||||||||||
Proceeds from customer funds and corporate marketable securities | 7,737 | 7,869 | |||||||||||||
Net cash used by investing activities | 0 | 31,275 | |||||||||||||
Net change in customer funds obligations | (6,007) | 1,723 | |||||||||||||
Net cash (used) provided by financing activities, | (6,007) | 1,723 | |||||||||||||
Effect of exchange rate change on cash, cash equivalents, restricted cash and restricted cash equivalents | 3,295 | 1,017 | |||||||||||||
Net change in cash, cash equivalents, restricted cash and restricted cash equivalents | (2,712) | 34,015 | |||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of year | $ 69,579 | $ 72,291 | 69,579 | 72,291 | 38,276 | ||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of year (Note 3) | 69,579 | 69,579 | 72,291 | ||||||||||||
Accounting Standards Update No. 2017-07 [Member] | Effect of adoption [Member] | |||||||||||||||
Total cost of revenue | (617) | (572) | |||||||||||||
Gross profit | (617) | (572) | |||||||||||||
Selling, general and administrative expense | (1,399) | (1,268) | |||||||||||||
Operating income | (2,016) | (1,840) | |||||||||||||
Other income | 2,016 | 1,840 | |||||||||||||
Net income | 0 | 0 | |||||||||||||
Accounting Standards Update No. 2017-07 [Member] | Effect of adoption [Member] | Product [Member] | |||||||||||||||
Total cost of revenue | (550) | (516) | |||||||||||||
Accounting Standards Update No. 2017-07 [Member] | Effect of adoption [Member] | Service [Member] | |||||||||||||||
Total cost of revenue | (67) | $ (56) | |||||||||||||
Accounting Standards Update No. 2018-02 [Member] | |||||||||||||||
Cumulative effect of adoption | 0 | 0 | |||||||||||||
Accounting Standards Update No. 2018-02 [Member] | Accumulated other comprehensive loss [Member] | |||||||||||||||
Cumulative effect of adoption | (6,867) | (6,867) | (6,867) | ||||||||||||
Accounting Standards Update No. 2018-02 [Member] | Retained earnings [Member] | |||||||||||||||
Cumulative effect of adoption | $ 6,867 | $ 6,867 | $ 6,867 | ||||||||||||
Accounting Standards Update No. 2018-05 [Member] | |||||||||||||||
Impact of Tax Cuts and Jobs Act | $ (1,700) | ||||||||||||||
Accounting Standards Update No. 2016-02 [Member] | Forecast [Member] | |||||||||||||||
Lease, practical expedient, short-term leases | true | ||||||||||||||
Accounting Standards Update No. 2016-02 [Member] | Forecast [Member] | Minimum [Member] | |||||||||||||||
Cumulative effect of adoption | $ 45,000 | ||||||||||||||
[1] | ) Cash and cash equivalents acquired were $1,645 during 2018 , $27,299 during 2017 and $146 during 2016 |
Supplemental balance sheet an_3
Supplemental balance sheet and cash flow information (trade accounts receivable) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Trade accounts receivable | ||||
Trade accounts receivable - gross | $ 177,501 | $ 152,728 | ||
Allowances for uncollectible accounts | (3,639) | (2,884) | $ (2,828) | $ (4,816) |
Trade accounts receivable - net | $ 173,862 | $ 149,844 |
Supplemental balance sheet an_4
Supplemental balance sheet and cash flow information (allowances for uncollectible accounts, inventories and supplies) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Allowances for uncollectible accounts | |||
Balance, beginning of year | $ 2,884 | $ 2,828 | $ 4,816 |
Bad debt expense | 3,622 | 3,208 | 2,539 |
Write-offs, net of recoveries | (2,867) | (3,152) | (4,527) |
Balance, end of year | 3,639 | 2,884 | $ 2,828 |
Inventories and supplies | |||
Raw materials | 7,543 | 7,357 | |
Semi-finished goods | 7,273 | 7,635 | |
Finished goods | 27,608 | 24,146 | |
Supplies | 4,017 | 3,111 | |
Inventories and supplies | $ 46,441 | $ 42,249 |
Supplemental balance sheet an_5
Supplemental balance sheet and cash flow information (available-for-sale debt securities) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | ||
Available-for-sale debt securities [Line Items] | ||||
Cost | $ 31,818 | [1] | $ 34,306 | [2] |
Gross unrealized gains | 0 | [1] | 0 | [2] |
Gross unrealized losses | (355) | [1] | (393) | [2] |
Available-for-sale debt securities | 31,463 | [1] | 33,913 | [2] |
Cash | 59,740 | 59,240 | ||
Expected maturities of available-for-sale debt securities | ||||
Due in one year or less | 25,195 | |||
Due in two to five years | 3,398 | |||
Due in six to ten years | 2,870 | |||
Available-for-sale debt securities | 31,463 | [1] | 33,913 | [2] |
Funds held for customers [Member] | ||||
Available-for-sale debt securities [Line Items] | ||||
Available-for-sale debt securities | 15,463 | 16,613 | ||
Cash | 69,519 | 52,279 | ||
Expected maturities of available-for-sale debt securities | ||||
Available-for-sale debt securities | 15,463 | 16,613 | ||
Funds held for customers [Member] | Money market securities [Member] | Domestic [Member] | ||||
Available-for-sale debt securities [Line Items] | ||||
Cost | 16,000 | 17,300 | ||
Gross unrealized gains | 0 | 0 | ||
Gross unrealized losses | 0 | 0 | ||
Available-for-sale debt securities | 16,000 | 17,300 | ||
Expected maturities of available-for-sale debt securities | ||||
Available-for-sale debt securities | 16,000 | 17,300 | ||
Funds held for customers [Member] | Canadian and provincial government securities [Member] | ||||
Available-for-sale debt securities [Line Items] | ||||
Cost | 8,485 | 9,051 | ||
Gross unrealized gains | 0 | 0 | ||
Gross unrealized losses | (355) | (393) | ||
Available-for-sale debt securities | 8,130 | 8,658 | ||
Expected maturities of available-for-sale debt securities | ||||
Available-for-sale debt securities | 8,130 | 8,658 | ||
Funds held for customers [Member] | Guaranteed investment certificates [Member] | Canadian [Member] | ||||
Available-for-sale debt securities [Line Items] | ||||
Cost | 7,333 | 7,955 | ||
Gross unrealized gains | 0 | 0 | ||
Gross unrealized losses | 0 | 0 | ||
Available-for-sale debt securities | 7,333 | 7,955 | ||
Expected maturities of available-for-sale debt securities | ||||
Available-for-sale debt securities | $ 7,333 | $ 7,955 | ||
[1] | Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2018 , also included cash of $69,519 . | |||
[2] | Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2017 , also included cash of $52,279 |
Supplemental balance sheet an_6
Supplemental balance sheet and cash flow information (property, plant and equipment) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Property, plant and equipment [Line Items] | ||
Gross carrying amount | $ 457,547 | $ 442,658 |
Accumulated depreciation | (367,205) | (358,020) |
Net carrying amount | 90,342 | 84,638 |
Land and improvements [Member] | ||
Property, plant and equipment [Line Items] | ||
Gross carrying amount | 28,199 | 28,220 |
Accumulated depreciation | (8,167) | (8,064) |
Net carrying amount | 20,032 | 20,156 |
Buildings and improvements [Member] | ||
Property, plant and equipment [Line Items] | ||
Gross carrying amount | 116,348 | 114,793 |
Accumulated depreciation | (83,317) | (80,168) |
Net carrying amount | 33,031 | 34,625 |
Machinery and equipment [Member] | ||
Property, plant and equipment [Line Items] | ||
Gross carrying amount | 313,000 | 299,645 |
Accumulated depreciation | (275,721) | (269,788) |
Net carrying amount | $ 37,279 | $ 29,857 |
Supplemental balance sheet an_7
Supplemental balance sheet and cash flow information (assets held for sale) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018USD ($)disposal_groups | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($)disposal_groups | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2018USD ($)disposal_groups | Dec. 31, 2017USD ($)disposal_groups | Dec. 31, 2016USD ($) | |
Assets held for sale [Line Items] | ||||||||||||
Proceeds from sales of businesses - notes receivable | $ 35,616 | $ 24,497 | $ 0 | |||||||||
Gain on sales of businesses and customer lists | $ 2,786 | $ 1,765 | $ 3,862 | $ 7,228 | $ 0 | $ 1,924 | $ 0 | $ 6,779 | 15,641 | 8,703 | $ 0 | |
Impairment charges, assets held for sale | $ 8,250 | |||||||||||
Net assets held for sale | ||||||||||||
Current assets | 0 | 4 | 0 | 4 | ||||||||
Intangibles | 1,350 | 8,459 | 1,350 | 8,459 | ||||||||
Goodwill | 0 | 3,566 | 0 | 3,566 | ||||||||
Other non-current assets | 0 | 207 | 0 | 207 | ||||||||
Net assets held for sale | $ 1,350 | $ 12,236 | $ 1,350 | $ 12,236 | ||||||||
Assets held for sale [Member] | Customer lists/relationships [Member] | ||||||||||||
Assets held for sale [Line Items] | ||||||||||||
Number of assets held for sale | disposal_groups | 1 | 1 | ||||||||||
Assets held for sale [Member] | Providers of printed and promotional products [Member] | ||||||||||||
Assets held for sale [Line Items] | ||||||||||||
Number of assets held for sale | disposal_groups | 2 | 2 | ||||||||||
Number of businesses sold | disposal_groups | 2 | 1 | ||||||||||
Assets held for sale [Member] | Small business distributors [Member] | ||||||||||||
Assets held for sale [Line Items] | ||||||||||||
Number of assets held for sale | disposal_groups | 2 | 2 | ||||||||||
Number of businesses sold | disposal_groups | 2 | 3 | ||||||||||
Assets held for sale [Member] | Provider of custom printing activities [Member] | ||||||||||||
Assets held for sale [Line Items] | ||||||||||||
Number of businesses sold | disposal_groups | 1 |
Supplemental balance sheet an_8
Supplemental balance sheet and cash flow information (intangibles) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Intangibles [Line Items] | |||||
Amortizable intangibles, gross carrying amount | $ 895,592 | $ 810,099 | |||
Accumulated amortization | (535,627) | (444,933) | |||
Amortizable intangibles, net carrying amount | 359,965 | 365,166 | |||
Intangibles, gross carrying amount | 895,592 | 829,199 | |||
Intangibles, net carrying amount | 359,965 | 384,266 | |||
Amortization of intangibles | 114,528 | 106,784 | $ 77,085 | ||
Intangibles acquired | $ 125,719 | $ 111,456 | $ 202,195 | ||
Weighted-average amortization period (in years) | 6 years | 6 years | 6 years | ||
Estimated amortization expense | |||||
2,019 | $ 90,924 | ||||
2,020 | 71,135 | ||||
2,021 | 54,795 | ||||
2,022 | 39,571 | ||||
2,023 | 29,205 | ||||
Trade names [Member] | |||||
Intangibles [Line Items] | |||||
Indefinite-lived intangibles, carrying amount | 0 | [1] | $ 19,100 | ||
Asset impairment charges | $ 19,100 | ||||
Internal-use software [Member] | |||||
Intangibles [Line Items] | |||||
Amortizable intangibles, gross carrying amount | 388,477 | 359,079 | |||
Accumulated amortization | (308,313) | (284,074) | |||
Amortizable intangibles, net carrying amount | 80,164 | 75,005 | |||
Amortization of intangibles | 38,307 | 35,952 | $ 35,217 | ||
Intangibles acquired | $ 42,744 | $ 38,422 | $ 45,780 | ||
Weighted-average amortization period (in years) | 3 years | 3 years | 4 years | ||
Customer lists/relationships [Member] | |||||
Intangibles [Line Items] | |||||
Amortizable intangibles, gross carrying amount | $ 379,570 | [2] | $ 343,589 | ||
Accumulated amortization | (170,973) | [2] | (121,729) | ||
Amortizable intangibles, net carrying amount | 208,597 | [2] | 221,860 | ||
Asset impairment charges | 4,031 | ||||
Amortization of intangibles | 57,243 | 54,450 | $ 33,233 | ||
Intangibles acquired | $ 60,775 | [3] | $ 60,034 | $ 118,415 | |
Weighted-average amortization period (in years) | 8 years | [3] | 7 years | 8 years | |
Customer lists/relationships [Member] | Asset purchase [Member] | |||||
Intangibles [Line Items] | |||||
Intangibles acquired | $ 1,188 | ||||
Trade names [Member] | |||||
Intangibles [Line Items] | |||||
Amortizable intangibles, gross carrying amount | 50,645 | $ 36,931 | |||
Accumulated amortization | (26,204) | (19,936) | |||
Amortizable intangibles, net carrying amount | 24,441 | 16,995 | |||
Amortization of intangibles | 6,362 | 5,789 | $ 4,952 | ||
Intangibles acquired | $ 14,700 | $ 10,000 | $ 3,800 | ||
Weighted-average amortization period (in years) | 7 years | 6 years | 4 years | ||
Technology-based intangible [Member] | |||||
Intangibles [Line Items] | |||||
Amortizable intangibles, gross carrying amount | $ 39,300 | $ 31,800 | |||
Accumulated amortization | (14,007) | (6,400) | |||
Amortizable intangibles, net carrying amount | 25,293 | 25,400 | |||
Amortization of intangibles | 7,607 | 6,400 | $ 0 | ||
Intangibles acquired | $ 7,500 | $ 800 | $ 28,000 | ||
Weighted-average amortization period (in years) | 5 years | 3 years | 5 years | ||
Software to be sold [Member] | |||||
Intangibles [Line Items] | |||||
Amortizable intangibles, gross carrying amount | $ 36,900 | $ 36,900 | |||
Accumulated amortization | (15,430) | (11,204) | |||
Amortizable intangibles, net carrying amount | 21,470 | 25,696 | |||
Intangibles acquired | 0 | $ 2,200 | $ 6,200 | ||
Weighted-average amortization period (in years) | 5 years | 10 years | |||
Other [Member] | |||||
Intangibles [Line Items] | |||||
Amortizable intangibles, gross carrying amount | 700 | $ 1,800 | |||
Accumulated amortization | (700) | (1,590) | |||
Amortizable intangibles, net carrying amount | 0 | 210 | |||
Other amortizable intangibles [Member] | |||||
Intangibles [Line Items] | |||||
Amortization of intangibles | $ 5,009 | $ 4,193 | $ 3,683 | ||
[1] | During the third quarter of 2018, we recorded a pre-tax asset impairment charge of $19,100 for our indefinite-lived trade name. Further information can be found in Note 8. | ||||
[2] | During 2018, we recorded pre-tax asset impairment charges of $4,031 | ||||
[3] | During 2018, we acquired customer lists of $1,188 |
Supplemental balance sheet an_9
Supplemental balance sheet and cash flow information (goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Changes in goodwill | ||||
Goodwill, gross, beginning of year | $ 1,179,313 | $ 1,125,956 | ||
Accumulated impairment charges, beginning of year | (48,379) | (20,000) | ||
Goodwill, net of accumulated impairment charges, beginning of year | 1,130,934 | 1,105,956 | ||
Impairment charge (Note 8) | (78,188) | (28,379) | $ 0 | |
Goodwill resulting from acquisitions (Note 6) | 105,907 | 59,998 | ||
Reclassification of assets held for sale | 635 | (3,970) | ||
Currency translation adjustment | (2,845) | 459 | ||
Goodwill, gross, end of period | 1,287,193 | 1,179,313 | 1,125,956 | |
Accumulated impairment charges, end of period | (126,567) | (48,379) | (20,000) | |
Goodwill, net of accumulated impairment charges, end of period | 1,160,626 | 1,130,934 | 1,105,956 | |
2016 acquisitions [Member] | ||||
Changes in goodwill | ||||
Goodwill resulting from acquisitions (Note 6) | [1] | 127,197 | ||
Measurement-period adjustments for prior year acquisitions (Note 6) | (2,130) | |||
2017 acquisitions [Member] | ||||
Changes in goodwill | ||||
Goodwill resulting from acquisitions (Note 6) | [2] | 63,941 | ||
Measurement-period adjustments for prior year acquisitions (Note 6) | 4,183 | |||
Small business distributors [Member] | ||||
Changes in goodwill | ||||
Sale of small business distributor | (1,000) | |||
Reportable business segments [Member] | Small Business Services [Member] | ||||
Changes in goodwill | ||||
Goodwill, gross, beginning of year | 706,568 | 684,261 | ||
Accumulated impairment charges, beginning of year | (48,379) | (20,000) | ||
Goodwill, net of accumulated impairment charges, beginning of year | 658,189 | 664,261 | ||
Impairment charge (Note 8) | (78,188) | 28,379 | ||
Goodwill resulting from acquisitions (Note 6) | 59,488 | 26,788 | ||
Reclassification of assets held for sale | 635 | (3,970) | ||
Currency translation adjustment | (2,845) | 459 | ||
Goodwill, gross, end of period | 765,266 | 706,568 | 684,261 | |
Accumulated impairment charges, end of period | (126,567) | (48,379) | (20,000) | |
Goodwill, net of accumulated impairment charges, end of period | 638,699 | 658,189 | 664,261 | |
Reportable business segments [Member] | Small Business Services [Member] | 2016 acquisitions [Member] | ||||
Changes in goodwill | ||||
Measurement-period adjustments for prior year acquisitions (Note 6) | 30 | |||
Reportable business segments [Member] | Small Business Services [Member] | 2017 acquisitions [Member] | ||||
Changes in goodwill | ||||
Measurement-period adjustments for prior year acquisitions (Note 6) | 1,420 | |||
Reportable business segments [Member] | Small Business Services [Member] | Small business distributors [Member] | ||||
Changes in goodwill | ||||
Sale of small business distributor | (1,000) | |||
Reportable business segments [Member] | Financial Services [Member] | ||||
Changes in goodwill | ||||
Goodwill, gross, beginning of year | 324,239 | 293,189 | ||
Accumulated impairment charges, beginning of year | 0 | 0 | ||
Goodwill, net of accumulated impairment charges, beginning of year | 324,239 | 293,189 | ||
Goodwill resulting from acquisitions (Note 6) | 46,419 | 33,210 | ||
Goodwill, gross, end of period | 373,421 | 324,239 | 293,189 | |
Accumulated impairment charges, end of period | 0 | 0 | 0 | |
Goodwill, net of accumulated impairment charges, end of period | 373,421 | 324,239 | 293,189 | |
Reportable business segments [Member] | Financial Services [Member] | 2016 acquisitions [Member] | ||||
Changes in goodwill | ||||
Measurement-period adjustments for prior year acquisitions (Note 6) | (2,160) | |||
Reportable business segments [Member] | Financial Services [Member] | 2017 acquisitions [Member] | ||||
Changes in goodwill | ||||
Measurement-period adjustments for prior year acquisitions (Note 6) | 2,763 | |||
Reportable business segments [Member] | Direct Checks [Member] | ||||
Changes in goodwill | ||||
Goodwill, gross, beginning of year | 148,506 | 148,506 | ||
Accumulated impairment charges, beginning of year | 0 | 0 | ||
Goodwill, net of accumulated impairment charges, beginning of year | 148,506 | 148,506 | ||
Goodwill, gross, end of period | 148,506 | 148,506 | 148,506 | |
Accumulated impairment charges, end of period | 0 | 0 | 0 | |
Goodwill, net of accumulated impairment charges, end of period | $ 148,506 | $ 148,506 | $ 148,506 | |
[1] | Net tangible assets acquired and liabilities assumed for 2016 included customer funds obligations of $12,532 related to the acquisition of Payce, Inc., as well as accounts receivable, revenue in excess of billings and accounts payable of FMCG. Amounts include measurement-period adjustments recorded in 2017 for the finalization of purchase accounting for several of the 2016 acquisitions. These adjustments decreased goodwill $2,130 , with the offset to various assets and liabilities, including other current assets, accounts payable and intangibles, including an increase of $3,000 in acquired technology-based intangibles and a decrease of $1,924 | |||
[2] | Net tangible assets acquired and liabilities assumed for 2017 consisted primarily of accounts receivable, marketable securities, inventory and accrued liabilities of RDM and Digital Pacific. Amounts include measurement-period adjustments recorded in 2018 for the finalization of purchase accounting for several of the 2017 acquisitions. These adjustments increased goodwill $4,183 , with the offset to various assets and liabilities, including deferred revenue, deferred income taxes and other long-term liabilities, as well as a decrease of $1,654 in customer list intangibles and an increase in internal-use software of $1,000 |
Supplemental balance sheet a_10
Supplemental balance sheet and cash flow information (other non-current assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||
Other non-current assets | |||||||
Loans and notes receivable from Safeguard distributors | $ 78,693 | $ 44,276 | |||||
Prepaid product discounts | 54,642 | [1] | 63,895 | [1] | $ 65,792 | $ 58,792 | |
Postretirement benefit plan asset (Note 14) | 41,259 | 39,849 | |||||
Deferred sales commissions | [2] | 6,482 | 0 | ||||
Deferred advertising costs | 5,746 | 6,135 | |||||
Other | 9,286 | 5,601 | |||||
Other non-current assets | 196,108 | $ 159,756 | |||||
Amortization of deferred sales commissions | $ 2,722 | ||||||
[1] | In our prior year financial statements, we referred to this asset as contract acquisition costs. | ||||||
[2] | Net of amortization of $2,722 for the year ended December 31, 2018. |
Supplemental balance sheet a_11
Supplemental balance sheet and cash flow information (other) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||||||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2015 | ||||
Changes in prepaid product discounts | |||||||||||||
Balance, beginning of year | $ 63,895 | [1] | $ 65,792 | $ 58,792 | |||||||||
Additions | [2] | 14,023 | 18,224 | 27,506 | |||||||||
Amortization | (22,941) | (19,969) | (20,185) | ||||||||||
Other | (335) | (152) | (321) | ||||||||||
Balance, end of year | 54,642 | [1] | 63,895 | [1] | 65,792 | ||||||||
Prepaid product discount payments | 23,814 | 27,079 | 23,068 | ||||||||||
Accrued liabilities | |||||||||||||
Funds held for customers | 99,818 | 85,091 | |||||||||||
Deferred revenue | 54,313 | 47,021 | |||||||||||
Employee profit sharing/cash bonus | 31,286 | 31,312 | |||||||||||
Prepaid product discounts due within one year | [3] | 10,926 | 11,670 | ||||||||||
Customer rebates | 9,555 | 11,508 | |||||||||||
Income tax | 7,991 | 17,827 | |||||||||||
Acquisition-related liabilities | [4] | 4,850 | 23,878 | ||||||||||
Restructuring and integration (Note 9) | 3,320 | 4,380 | |||||||||||
Other | 62,222 | 44,566 | |||||||||||
Accrued liabilities | 284,281 | 277,253 | |||||||||||
Other non-current liabilities | |||||||||||||
Prepaid product discounts | [5] | 12,513 | 21,658 | ||||||||||
Other | 27,367 | 30,583 | |||||||||||
Other non-current liabilities | 39,880 | 52,241 | |||||||||||
Cash and cash equivalents | 59,740 | 59,240 | 76,574 | ||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents | 145,259 | 128,819 | 148,865 | $ 126,114 | $ 145,303 | $ 146,479 | $ 115,172 | $ 105,479 | $ 160,000 | $ 100,703 | |||
Income taxes paid | 88,253 | 124,878 | 97,309 | ||||||||||
Interest paid | 25,910 | 19,465 | 20,975 | ||||||||||
Non-cash investing activities [Line Items] | |||||||||||||
Proceeds from sales of businesses - notes receivable | 35,616 | 24,497 | 0 | ||||||||||
2018 acquisitions [Member] | |||||||||||||
Non-cash investing activities [Line Items] | |||||||||||||
Acquisition-related liabilities | [6] | 3,011 | |||||||||||
2017 acquisitions [Member] | |||||||||||||
Non-cash investing activities [Line Items] | |||||||||||||
Acquisition-related liabilities | [6] | 5,855 | |||||||||||
2016 acquisitions [Member] | |||||||||||||
Non-cash investing activities [Line Items] | |||||||||||||
Acquisition-related liabilities | [6] | 27,441 | |||||||||||
Funds held for customers [Member] | |||||||||||||
Restricted cash and restricted cash equivalents included in funds held for customers | $ 85,519 | $ 69,579 | $ 72,291 | ||||||||||
[1] | In our prior year financial statements, we referred to this asset as contract acquisition costs. | ||||||||||||
[2] | Prepaid product discounts are generally accrued upon contract execution. Cash payments made for prepaid product discounts were $23,814 for 2018 , $27,079 for 2017 and $23,068 for 2016 | ||||||||||||
[3] | In our prior year financial statements, we referred to this liability as contract acquisition costs due within one year. | ||||||||||||
[4] | Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 8. | ||||||||||||
[5] | In our prior year financial statements, we referred to this liability as contract acquisition costs. | ||||||||||||
[6] | Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 8. |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings per share - basic: | |||||||||||
Net income | $ 57,170 | $ (31,083) | $ 60,207 | $ 63,336 | $ 84,709 | $ 28,801 | $ 59,579 | $ 57,066 | $ 149,630 | $ 230,155 | $ 229,382 |
Income allocated to participating securities | (617) | (1,457) | (1,870) | ||||||||
Income available to common shareholders | $ 149,013 | $ 228,698 | $ 227,512 | ||||||||
Weighted-average shares outstanding | 46,842 | 48,127 | 48,562 | ||||||||
Earnings per share - basic | $ 1.25 | $ (0.67) | $ 1.26 | $ 1.32 | $ 1.76 | $ 0.60 | $ 1.23 | $ 1.17 | $ 3.18 | $ 4.75 | $ 4.68 |
Earnings per share - diluted: | |||||||||||
Net income | $ 57,170 | $ (31,083) | $ 60,207 | $ 63,336 | $ 84,709 | $ 28,801 | $ 59,579 | $ 57,066 | $ 149,630 | $ 230,155 | $ 229,382 |
Income allocated to participating securities | (616) | (1,450) | (1,858) | ||||||||
Re-measurement of share-based awards classified as liabilities | (471) | 59 | 296 | ||||||||
Income available to common shareholders | $ 148,543 | $ 228,764 | $ 227,820 | ||||||||
Weighted-average shares outstanding | 46,842 | 48,127 | 48,562 | ||||||||
Dilutive impact of potential common shares | 149 | 321 | 413 | ||||||||
Weighted-average shares and potential common shares outstanding | 46,991 | 48,448 | 48,975 | ||||||||
Earnings per share - diluted | $ 1.25 | $ (0.67) | $ 1.25 | $ 1.31 | $ 1.75 | $ 0.59 | $ 1.22 | $ 1.16 | $ 3.16 | $ 4.72 | $ 4.65 |
Antidilutive options excluded from calculation | 1,209 | 262 | 214 |
Other comprehensive (loss) in_3
Other comprehensive (loss) income (reclassification adjustments) (Details) - Amounts reclassified from accumulated other comprehensive loss [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reclassification adjustments [Line Items] | |||
Prior service credit | $ 1,421 | $ 1,421 | $ 1,421 |
Net actuarial loss | (2,884) | (3,637) | (3,797) |
Total amortization | (1,463) | (2,216) | (2,376) |
Tax benefit | 491 | 372 | 724 |
Total reclassifications, net of tax | $ (972) | $ (1,844) | $ (1,652) |
Other comprehensive (loss) in_4
Other comprehensive (loss) income (accumulated other comprehensive loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2018 | |
Accumulated other comprehensive loss [Line Items] | ||||
Balance, beginning of year | $ (37,597) | |||
Balance, end of year | (56,579) | $ (37,597) | ||
Postretirement benefit plans, net of tax [Member] | ||||
Accumulated other comprehensive loss [Line Items] | ||||
Balance, beginning of year | (26,829) | (35,684) | $ (38,822) | |
Other comprehensive income (loss) before reclassifications | (3,805) | 7,011 | 1,486 | |
Amounts reclassified from accumulated other comprehensive loss | 972 | 1,844 | 1,652 | |
Net current-period other comprehensive income (loss) | (2,833) | 8,855 | 3,138 | |
Balance, end of year | (36,529) | (26,829) | (35,684) | |
Net unrealized loss on marketable securities, net of tax [Member] | ||||
Accumulated other comprehensive loss [Line Items] | ||||
Balance, beginning of year | (322) | (213) | (114) | |
Other comprehensive income (loss) before reclassifications | (1) | (109) | (99) | |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | 0 | |
Net current-period other comprehensive income (loss) | (1) | (109) | (99) | |
Balance, end of year | (323) | (322) | (213) | |
Currency translation adjustment [Member] | ||||
Accumulated other comprehensive loss [Line Items] | ||||
Balance, beginning of year | (10,446) | (14,474) | (16,267) | |
Other comprehensive income (loss) before reclassifications | (9,281) | 4,028 | 1,793 | |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | 0 | |
Net current-period other comprehensive income (loss) | (9,281) | 4,028 | 1,793 | |
Balance, end of year | (19,727) | (10,446) | (14,474) | |
Accumulated other comprehensive loss [Member] | ||||
Accumulated other comprehensive loss [Line Items] | ||||
Balance, beginning of year | (37,597) | (50,371) | (55,203) | |
Other comprehensive income (loss) before reclassifications | (13,087) | 10,930 | 3,180 | |
Amounts reclassified from accumulated other comprehensive loss | 972 | 1,844 | 1,652 | |
Net current-period other comprehensive income (loss) | (12,115) | 12,774 | 4,832 | |
Balance, end of year | $ (56,579) | (37,597) | $ (50,371) | |
Accounting Standards Update No. 2018-02 [Member] | ||||
Accumulated other comprehensive loss [Line Items] | ||||
Cumulative effect of adoption | 0 | |||
Accounting Standards Update No. 2018-02 [Member] | Postretirement benefit plans, net of tax [Member] | ||||
Accumulated other comprehensive loss [Line Items] | ||||
Cumulative effect of adoption | $ (6,867) | |||
Accounting Standards Update No. 2018-02 [Member] | Accumulated other comprehensive loss [Member] | ||||
Accumulated other comprehensive loss [Line Items] | ||||
Cumulative effect of adoption | $ (6,867) | $ (6,867) |
Acquisitions (Details)
Acquisitions (Details) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018USD ($)business | Dec. 31, 2017USD ($)business | Dec. 31, 2016USD ($) | Dec. 31, 2015business | |||
Acquisitions [Line Items] | ||||||
Transaction costs | $ 1,719 | $ 2,342 | $ 4,944 | |||
Identifiable intangible assets | 125,719 | 111,456 | 202,195 | |||
Goodwill | 105,907 | 59,998 | ||||
Holdback payments for prior year acquisitions | 21,269 | 10,153 | 1,534 | |||
Payments for acquisitions, net of cash acquired | [1] | 214,258 | 139,223 | 239,664 | ||
Customer lists/relationships [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 60,775 | [2] | 60,034 | 118,415 | ||
Trade names [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 14,700 | 10,000 | 3,800 | |||
Software to be sold [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 0 | 2,200 | 6,200 | |||
Technology-based intangible [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 7,500 | 800 | 28,000 | |||
Internal-use software [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 42,744 | 38,422 | 45,780 | |||
Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 59,488 | 26,788 | ||||
Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 46,419 | 33,210 | ||||
Logomix Inc. [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 29,451 | |||||
ColoCrossing [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 9,689 | |||||
My Corporation Business Services, Inc. [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 20,348 | |||||
REMITCO [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 46,419 | |||||
REMITCO [Member] | Reportable business segments [Member] | Financial Services [Member] | Customer lists/relationships [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | $ 36,000 | |||||
Panthur Pty Ltd [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 1,198 | |||||
Digital Pacific Group Pty Limited [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 23,773 | |||||
j2 Global Australia Pty Ltd [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 2,731 | |||||
managed.com [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 266 | |||||
RDM Corporation [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | $ 35,973 | |||||
180 Fusion LLC [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 800 | |||||
Inkhead, Inc. [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 4,421 | |||||
BNBS, Inc. [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 850 | |||||
Payce, Inc. [Member] | ||||||
Acquisitions [Line Items] | ||||||
Assumed liability for customer funds obligations | 12,532 | |||||
Payce, Inc. [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 6,882 | |||||
Data Support Systems, Inc. [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill | 4,025 | |||||
First Manhattan Consulting Group, LLC [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Net tangible assets acquired and liabilities assumed | [3] | 4,334 | ||||
Identifiable intangible assets | [4] | 87,000 | ||||
Goodwill | 110,219 | |||||
Total aggregate purchase price | 201,553 | |||||
Liabilities for holdback payments and contingent consideration | (16,000) | |||||
Payments for acquisitions, net of cash acquired | 185,553 | |||||
First Manhattan Consulting Group, LLC [Member] | Reportable business segments [Member] | Financial Services [Member] | Customer lists/relationships [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | $ 53,000 | |||||
Useful life of acquired intangibles | 7 years | |||||
First Manhattan Consulting Group, LLC [Member] | Reportable business segments [Member] | Financial Services [Member] | Trade names [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | $ 3,000 | |||||
Useful life of acquired intangibles | 4 years | |||||
First Manhattan Consulting Group, LLC [Member] | Reportable business segments [Member] | Financial Services [Member] | Technology-based intangible [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | $ 31,000 | |||||
Useful life of acquired intangibles | 5 years | |||||
Small business distributors [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Number of businesses acquired | business | 3 | |||||
Small business distributors [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Number of businesses acquired | business | 2 | |||||
Small business distributors not previously part of our distributor network [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Number of businesses acquired | business | 1 | |||||
2018 acquisitions [Member] | ||||||
Acquisitions [Line Items] | ||||||
Net tangible assets acquired and liabilities assumed | [5],[6] | $ 9,366 | ||||
Identifiable intangible assets | 81,787 | |||||
Goodwill | 105,907 | |||||
Total aggregate purchase price | 197,060 | |||||
Liabilities for holdback payments and contingent consideration | [7] | (3,011) | ||||
Non-cash consideration | [8] | (1,060) | ||||
Payments for acquisitions, net of cash acquired | 192,989 | |||||
Goodwill, purchase accounting adjustment | 4,183 | |||||
Trade accounts receivable acquired | 11,564 | |||||
Cash and cah equivalents acquired | 1,645 | |||||
2018 acquisitions [Member] | Customer lists/relationships [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 59,587 | |||||
2018 acquisitions [Member] | Trade names [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 14,700 | |||||
2018 acquisitions [Member] | Software to be sold [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 0 | |||||
2018 acquisitions [Member] | Technology-based intangible [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 7,500 | |||||
2018 acquisitions [Member] | Internal-use software [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | 0 | |||||
2017 acquisitions [Member] | ||||||
Acquisitions [Line Items] | ||||||
Net tangible assets acquired and liabilities assumed | [6],[9] | $ (1,956) | ||||
Identifiable intangible assets | [9] | 73,065 | ||||
Goodwill | [9] | 63,941 | ||||
Total aggregate purchase price | [9] | 135,050 | ||||
Liabilities for holdback payments and contingent consideration | [7] | (5,980) | ||||
Non-cash consideration | [8] | 0 | ||||
Payments for acquisitions, net of cash acquired | 129,070 | |||||
Goodwill, purchase accounting adjustment | 4,183 | |||||
Trade accounts receivable acquired | 4,544 | |||||
Cash and cah equivalents acquired | 27,299 | |||||
2017 acquisitions [Member] | Customer lists/relationships [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [9] | 58,620 | ||||
Intangibles, purchase accounting adjustments | (1,654) | |||||
2017 acquisitions [Member] | Trade names [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [9] | 10,000 | ||||
2017 acquisitions [Member] | Software to be sold [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [9] | 2,200 | ||||
2017 acquisitions [Member] | Technology-based intangible [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [9] | 800 | ||||
2017 acquisitions [Member] | Internal-use software [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [9] | 1,445 | ||||
Intangibles, purchase accounting adjustments | 1,000 | |||||
2017 acquisitions [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill, purchase accounting adjustment | 1,420 | |||||
2017 acquisitions [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill, purchase accounting adjustment | $ 2,763 | |||||
2016 acquisitions [Member] | ||||||
Acquisitions [Line Items] | ||||||
Net tangible assets acquired and liabilities assumed | [6],[10] | $ (8,804) | ||||
Identifiable intangible assets | [10] | 167,941 | ||||
Goodwill | [10] | 127,197 | ||||
Total aggregate purchase price | [10] | 286,334 | ||||
Liabilities for holdback payments and contingent consideration | [7] | (27,441) | ||||
Non-cash consideration | [8] | (2,020) | ||||
Payments for acquisitions, net of cash acquired | 256,873 | |||||
Goodwill, purchase accounting adjustment | (2,130) | |||||
Trade accounts receivable acquired | 8,065 | |||||
Cash and cah equivalents acquired | 146 | |||||
2016 acquisitions [Member] | Customer lists/relationships [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [10] | 116,491 | ||||
Intangibles, purchase accounting adjustments | (1,924) | |||||
2016 acquisitions [Member] | Trade names [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [10] | 3,800 | ||||
2016 acquisitions [Member] | Software to be sold [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [10] | 6,200 | ||||
2016 acquisitions [Member] | Technology-based intangible [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [10] | 31,000 | ||||
Intangibles, purchase accounting adjustments | 3,000 | |||||
2016 acquisitions [Member] | Internal-use software [Member] | ||||||
Acquisitions [Line Items] | ||||||
Identifiable intangible assets | [10] | 10,450 | ||||
2016 acquisitions [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill, purchase accounting adjustment | 30 | |||||
2016 acquisitions [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||
Acquisitions [Line Items] | ||||||
Goodwill, purchase accounting adjustment | $ (2,160) | |||||
2015 acquisitions [Member] | Funds held for customers [Member] | ||||||
Acquisitions [Line Items] | ||||||
Measurement period adjustment for 2015 acquisition | [11] | $ (18,743) | ||||
[1] | ) Cash and cash equivalents acquired were $1,645 during 2018 , $27,299 during 2017 and $146 during 2016 | |||||
[2] | During 2018, we acquired customer lists of $1,188 | |||||
[3] | Net tangible assets acquired consisted primarily of accounts receivable, revenue in excess of billings and accounts payable outstanding as of the date of acquisition. | |||||
[4] | The useful lives of the acquired intangible assets were as follows: customer list/relationships – 7 years; technology-based intangible – 5 years; and trade name – 4 | |||||
[5] | Net tangible assets acquired and liabilities assumed for 2018 consisted primarily of REMITCO accounts receivable and Logomix deferred income tax liabilities. | |||||
[6] | Net tangible assets acquired included trade accounts receivable of $11,564 during 2018 , $4,544 during 2017 and $8,065 during 2016 . | |||||
[7] | Consists of holdback payments due at future dates and liabilities for contingent consideration. Further information regarding liabilities for contingent consideration can be found in Note 8. | |||||
[8] | Consists of pre-acquisition amounts owed to us by certain of the acquired businesses. | |||||
[9] | Net tangible assets acquired and liabilities assumed for 2017 consisted primarily of accounts receivable, marketable securities, inventory and accrued liabilities of RDM and Digital Pacific. Amounts include measurement-period adjustments recorded in 2018 for the finalization of purchase accounting for several of the 2017 acquisitions. These adjustments increased goodwill $4,183 , with the offset to various assets and liabilities, including deferred revenue, deferred income taxes and other long-term liabilities, as well as a decrease of $1,654 in customer list intangibles and an increase in internal-use software of $1,000 | |||||
[10] | Net tangible assets acquired and liabilities assumed for 2016 included customer funds obligations of $12,532 related to the acquisition of Payce, Inc., as well as accounts receivable, revenue in excess of billings and accounts payable of FMCG. Amounts include measurement-period adjustments recorded in 2017 for the finalization of purchase accounting for several of the 2016 acquisitions. These adjustments decreased goodwill $2,130 , with the offset to various assets and liabilities, including other current assets, accounts payable and intangibles, including an increase of $3,000 in acquired technology-based intangibles and a decrease of $1,924 | |||||
[11] | Reflects a measurement-period adjustment recorded in 2016 for funds held for customers of FISC Solutions, which was acquired in December 2015. Cash and cash equivalents included in funds held for customers are presented as restricted cash and restricted cash equivalents in the consolidated statements of cash flows. |
Derivative financial instrume_2
Derivative financial instruments (Details) - Fair value hedge [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative financial instruments [Line Items] | ||
Notional amount | $ 200,000 | |
Cash paid to settle interest rate swaps | $ 2,842 |
Fair value measurements (goodwi
Fair value measurements (goodwill and indefinite-lived intangible) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2018USD ($)reporting_units | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jul. 31, 2018USD ($) | Jul. 31, 2017USD ($) | Jul. 31, 2016USD ($) | Jul. 31, 2015 | |
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Goodwill | $ 1,160,626 | $ 1,130,934 | $ 1,105,956 | ||||||
Goodwill impairment charge | 78,188 | 28,379 | 0 | ||||||
Excess of fair value over carrying value of indefinite-lived trade name | $ 16,000 | $ 32,000 | |||||||
Carrying value of indefinite-lived trade name | 19,100 | $ 19,100 | |||||||
Measurement input, royalty rate [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Intangibles fair value inputs | 0.00% | ||||||||
Nonrecurring [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Asset impairment charges | $ 4,031 | 26,501 | |||||||
Trade names [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Asset impairment charges | $ 19,100 | ||||||||
Reporting units for which qualitative analysis completed [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Number of reporting units | reporting_units | 5 | ||||||||
Reporting units for which qualitative analysis completed [Member] | Minimum [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Excess of fair value over carrying value of reporting unit's net assets | $ 64,000 | ||||||||
Excess of fair value over carrying value of reporting unit, percentage | 50.00% | ||||||||
Reporting units for which qualitative analysis completed [Member] | Maximum [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Excess of fair value over carrying value of reporting unit's net assets | $ 1,405,000 | ||||||||
Excess of fair value over carrying value of reporting unit, percentage | 314.00% | ||||||||
Reporting units for which quantitative analysis completed [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Number of reporting units | reporting_units | 2 | ||||||||
Reporting units for which quantitative analysis completed [Member] | Minimum [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Excess of fair value over carrying value of reporting unit's net assets | $ 64,000 | ||||||||
Excess of fair value over carrying value of reporting unit, percentage | 36.00% | ||||||||
Reporting units for which quantitative analysis completed [Member] | Maximum [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Excess of fair value over carrying value of reporting unit's net assets | $ 1,405,000 | ||||||||
Excess of fair value over carrying value of reporting unit, percentage | 314.00% | ||||||||
Small Business Services Web Services [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Excess of fair value over carrying value of reporting unit's net assets | $ 63,000 | ||||||||
Excess of fair value over carrying value of reporting unit, percentage | 22.00% | ||||||||
Goodwill | $ 225,383 | ||||||||
Small Business Services Indirect [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Goodwill impairment charge | 78,188 | ||||||||
Small Business Services Indirect [Member] | Trade names [Member] | Significant unobservable inputs (Level 3) [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Asset impairment charges | $ 19,100 | ||||||||
Small Business Services Safeguard [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Goodwill impairment charge | $ 28,379 | ||||||||
Financial Services Commercial [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Excess of fair value over carrying value of reporting unit, percentage | 49.00% | 13.00% | |||||||
Goodwill | $ 45,000 | ||||||||
Financial Servcices Data-Driven Marketing [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Goodwill | $ 186,388 | ||||||||
Financial Servcices Data-Driven Marketing [Member] | Nonrecurring [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Excess of fair value over carrying value of reporting unit's net assets | $ 105,000 | ||||||||
Excess of fair value over carrying value of reporting unit, percentage | 36.00% | ||||||||
Goodwill impairment charge | $ 0 | ||||||||
Indefinite-lived intangible assets [Member] | |||||||||
Schedule of goodwill and indefinite-lived intangibles [Line Items] | |||||||||
Asset impairment charges | $ 0 | $ 0 |
Fair value measurements (non-re
Fair value measurements (non-recurring asset impairment analyses) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Sep. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2018USD ($)business | Dec. 31, 2017USD ($) | Dec. 31, 2015business | ||
Non-recurring fair value measurements [Line Items] | ||||||||
Impairment charges, assets held for sale | $ 8,250 | |||||||
Customer lists/relationships [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Asset impairment charges | $ 4,031 | |||||||
Reportable business segments [Member] | Financial Services [Member] | Small business distributors [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Number of businesses acquired | business | 2 | |||||||
Reportable business segments [Member] | Small Business Services [Member] | Small business distributors [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Number of businesses acquired | business | 3 | |||||||
Nonrecurring [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Asset impairment charges | $ 4,031 | $ 26,501 | ||||||
Nonrecurring [Member] | Reportable business segments [Member] | Financial Services [Member] | Customer lists/relationships [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Asset impairment charges | $ 1,882 | |||||||
Fair value as of measurement date | [1] | 4,223 | ||||||
Nonrecurring [Member] | Reportable business segments [Member] | Financial Services [Member] | Customer lists/relationships [Member] | Significant unobservable inputs (Level 3) [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Fair value as of measurement date | [1] | $ 4,223 | ||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Assets held for sale [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Impairment charges, assets held for sale | 8,250 | |||||||
Fair value as of measurement date | 3,500 | |||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Assets held for sale [Member] | Significant unobservable inputs (Level 3) [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Fair value as of measurement date | $ 3,500 | |||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Long-lived assets [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Asset impairment charges | $ 3,499 | |||||||
Fair value as of measurement date | 0 | |||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Long-lived assets [Member] | Significant unobservable inputs (Level 3) [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Fair value as of measurement date | 0 | |||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Customer lists/relationships [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Asset impairment charges | $ 2,149 | |||||||
Fair value as of measurement date | 0 | |||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Customer lists/relationships [Member] | Significant unobservable inputs (Level 3) [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Fair value as of measurement date | $ 0 | |||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Trade names [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Asset impairment charges | 14,752 | |||||||
Fair value as of measurement date | 0 | |||||||
Nonrecurring [Member] | Reportable business segments [Member] | Small Business Services [Member] | Trade names [Member] | Significant unobservable inputs (Level 3) [Member] | ||||||||
Non-recurring fair value measurements [Line Items] | ||||||||
Fair value as of measurement date | $ 0 | |||||||
[1] | The fair value presented is for the entire asset group that includes the impaired customer lists. |
Fair value measurements (acquis
Fair value measurements (acquisitions) (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Verify Valid [Member] | ||
Acquisitions [Line Items] | ||
Liability for contingent consideration, maximum unlimited | there are no maximum amounts of contingent payments specified | |
Data Support Systems, Inc. [Member] | ||
Acquisitions [Line Items] | ||
Liability for contingent consideration, maximum unlimited | there are no maximum amounts of contingent payments specified |
Fair value measurements (recurr
Fair value measurements (recurring fair value measurements ) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Fair value measurements, hedge ineffectiveness | |||
Gain from derivatives | $ 1,200 | ||
Loss from change in fair value of hedged debt | (1,200) | ||
Net effect on interest expense | 0 | ||
Accrued contingent consideration [Member] | |||
Change in accrued contingent consideration | |||
Balance, beginning of year | $ 3,623 | $ 4,682 | 5,861 |
Acquisition date fair value | 100 | 0 | 1,132 |
Change in fair value | 610 | 1,190 | (1,174) |
Payments | (1,937) | (2,249) | (1,137) |
Balance, end of year | $ 2,396 | $ 3,623 | $ 4,682 |
Canadian [Member] | Funds held for customers [Member] | Guaranteed investment certificates [Member] | |||
Available-for-sale debt securities | |||
Maximum maturity period, debt securities | 1 year |
Fair value measurements (financ
Fair value measurements (financial instruments) (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | |||
Fair value measurements, financial instruments [Line Items] | |||||
Accrued contingent consideration | $ (2,396) | $ (3,623) | |||
Available-for-sale debt securities | 31,463 | [1] | 33,913 | [2] | |
Cash | 59,740 | 59,240 | |||
Cash, fair value | 59,740 | 59,240 | |||
Loans and notes receivable from Safeguard distributors | 81,560 | 46,409 | |||
Loans and notes receivable from Safeguard distributors, fair value | 60,795 | 44,650 | |||
Long-term debt | [3] | 910,000 | 707,386 | ||
Long-term debt, fair value | [3] | 910,000 | 707,938 | ||
Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Accrued contingent consideration | (2,396) | (3,623) | |||
Quoted prices in active markets for identical assets (Level 1) [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash, fair value | 59,740 | 59,240 | |||
Loans and notes receivable from Safeguard distributors, fair value | 0 | 0 | |||
Long-term debt, fair value | [3] | 0 | 0 | ||
Quoted prices in active markets for identical assets (Level 1) [Member] | Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Accrued contingent consideration | 0 | 0 | |||
Significant other observable inputs (Level 2) [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash, fair value | 0 | 0 | |||
Loans and notes receivable from Safeguard distributors, fair value | 0 | 0 | |||
Long-term debt, fair value | [3] | 910,000 | 707,938 | ||
Significant other observable inputs (Level 2) [Member] | Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Accrued contingent consideration | 0 | 0 | |||
Significant unobservable inputs (Level 3) [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash, fair value | 0 | 0 | |||
Loans and notes receivable from Safeguard distributors, fair value | 60,795 | 44,650 | |||
Long-term debt, fair value | [3] | 0 | 0 | ||
Significant unobservable inputs (Level 3) [Member] | Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Accrued contingent consideration | (2,396) | (3,623) | |||
Funds held for customers [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash equivalents | 16,000 | 17,300 | |||
Available-for-sale debt securities | 15,463 | 16,613 | |||
Cash | 69,519 | 52,279 | |||
Cash, fair value | 69,519 | 52,279 | |||
Funds held for customers [Member] | Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash equivalents | 16,000 | 17,300 | |||
Available-for-sale debt securities | 15,463 | 16,613 | |||
Funds held for customers [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash, fair value | 69,519 | 52,279 | |||
Funds held for customers [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash equivalents | 16,000 | 17,300 | |||
Available-for-sale debt securities | 0 | 0 | |||
Funds held for customers [Member] | Significant other observable inputs (Level 2) [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash, fair value | 0 | 0 | |||
Funds held for customers [Member] | Significant other observable inputs (Level 2) [Member] | Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash equivalents | 0 | 0 | |||
Available-for-sale debt securities | 15,463 | 16,613 | |||
Funds held for customers [Member] | Significant unobservable inputs (Level 3) [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash, fair value | 0 | 0 | |||
Funds held for customers [Member] | Significant unobservable inputs (Level 3) [Member] | Recurring fair value measurements [Member] | |||||
Fair value measurements, financial instruments [Line Items] | |||||
Cash equivalents | 0 | 0 | |||
Available-for-sale debt securities | $ 0 | $ 0 | |||
[1] | Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2018 , also included cash of $69,519 . | ||||
[2] | Funds held for customers, as reported on the consolidated balance sheet as of December 31, 2017 , also included cash of $52,279 | ||||
[3] | Amounts exclude capital lease obligations. |
Restructuring and integration_3
Restructuring and integration expense (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | 60 Months Ended | ||||||||||||
Dec. 31, 2018USD ($)Employees | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)Employees | Dec. 31, 2017USD ($)Employees | Dec. 31, 2016USD ($)Employees | Dec. 31, 2018USD ($)Employees | Dec. 31, 2015USD ($) | |||
Restructuring and integration expense [Line Items] | |||||||||||||||
Restructuring and integration expense | $ 7,406 | $ 5,104 | $ 6,371 | $ 2,322 | $ 5,438 | $ 1,242 | $ 1,457 | $ 993 | $ 21,203 | $ 9,130 | $ 7,771 | $ 37,780 | [1] | ||
Restructuring and integration reversals | $ (1,969) | $ (667) | $ (864) | (5,291) | |||||||||||
Number of employees in severance accruals | Employees | 205 | 200 | 265 | ||||||||||||
Other restructuring and integration expense disclosures | |||||||||||||||
Restructuring and integration accruals, total | 3,461 | 4,380 | $ 3,461 | $ 4,380 | $ 4,181 | 3,461 | $ 3,864 | ||||||||
Restructuring and integration accruals, current | 3,320 | $ 4,380 | 3,320 | 4,380 | 3,320 | ||||||||||
Restructuring and integration accruals, non-current | $ 141 | $ 141 | $ 141 | ||||||||||||
Number of employees that have not started to receive severance benefits | Employees | 30 | 30 | 30 | ||||||||||||
Total cost of revenue [Member] | |||||||||||||||
Restructuring and integration expense [Line Items] | |||||||||||||||
Restructuring and integration expense | $ 1,466 | 568 | 647 | ||||||||||||
Operating expenses [Member] | |||||||||||||||
Restructuring and integration expense [Line Items] | |||||||||||||||
Restructuring and integration expense | 19,737 | 8,562 | 7,124 | ||||||||||||
Employee severance [Member] | |||||||||||||||
Restructuring and integration expense [Line Items] | |||||||||||||||
Restructuring and integration expense | 7,672 | 7,843 | 7,217 | ||||||||||||
Restructuring and integration reversals | (1,898) | (667) | (864) | ||||||||||||
Operating lease obligations [Member] | |||||||||||||||
Restructuring and integration expense [Line Items] | |||||||||||||||
Restructuring and integration expense | 597 | 23 | 59 | ||||||||||||
Restructuring and integration reversals | (71) | 0 | 0 | ||||||||||||
Employee severance and operating lease obligations [Member] | |||||||||||||||
Restructuring and integration expense [Line Items] | |||||||||||||||
Restructuring and integration expense | 8,269 | 7,866 | 7,276 | $ 37,780 | |||||||||||
Restructuring and integration reversals | [1] | $ (5,291) | |||||||||||||
Net accruals | 6,300 | 7,199 | 6,412 | ||||||||||||
Other costs [Member] | |||||||||||||||
Restructuring and integration expense [Line Items] | |||||||||||||||
Restructuring and integration expense | $ 14,903 | $ 1,931 | $ 1,359 | ||||||||||||
[1] | Includes accruals related to our cost reduction and integration initiatives for 2014 through 2018. |
Restructuring and integration_4
Restructuring and integration expense (restructuring and integration accruals by year and by segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | 60 Months Ended | |||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | |||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | $ 4,380 | $ 4,181 | $ 4,380 | $ 4,181 | $ 3,864 | |||||||||
Charges | $ 7,406 | $ 5,104 | $ 6,371 | 2,322 | $ 5,438 | $ 1,242 | $ 1,457 | 993 | 21,203 | 9,130 | 7,771 | $ 37,780 | [1] | |
Reversals | (1,969) | (667) | (864) | (5,291) | ||||||||||
Inter-segment transfer | [1] | 0 | ||||||||||||
Payments | (7,219) | (7,000) | (6,095) | (29,028) | [1] | |||||||||
Balance, end of year | 3,461 | 4,380 | 3,461 | 4,380 | 4,181 | 3,461 | ||||||||
2018 initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 0 | 0 | 0 | 0 | 0 | |||||||||
Reversals | (1,412) | 0 | 0 | (1,412) | ||||||||||
Payments | (3,276) | 0 | 0 | (3,276) | ||||||||||
Balance, end of year | 3,448 | 0 | 3,448 | 0 | 0 | 3,448 | ||||||||
2017 Initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 4,348 | 0 | 4,348 | 0 | 0 | |||||||||
Reversals | (552) | (161) | 0 | (713) | ||||||||||
Payments | (3,916) | (2,713) | 0 | (6,629) | ||||||||||
Balance, end of year | 13 | 4,348 | 13 | 4,348 | 0 | 13 | ||||||||
2016 initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 32 | 4,101 | 32 | 4,101 | 0 | |||||||||
Reversals | (5) | (464) | (281) | (750) | ||||||||||
Payments | (27) | (4,208) | (2,816) | (7,051) | ||||||||||
Balance, end of year | 0 | 32 | 0 | 32 | 4,101 | 0 | ||||||||
2014 and 2015 initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 0 | 80 | 0 | 80 | 3,864 | |||||||||
Reversals | 0 | (42) | (583) | (2,416) | ||||||||||
Payments | 0 | (79) | (3,279) | (12,072) | ||||||||||
Balance, end of year | 0 | 0 | 0 | 0 | 80 | 0 | ||||||||
Employee severance [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Charges | 7,672 | 7,843 | 7,217 | |||||||||||
Reversals | (1,898) | (667) | (864) | |||||||||||
Employee severance [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 789 | 1,183 | 789 | 1,183 | 1,023 | |||||||||
Charges | 2,682 | 2,032 | 2,634 | 13,073 | [1] | |||||||||
Reversals | (530) | (214) | (369) | (2,313) | [1] | |||||||||
Inter-segment transfer | [1] | 41 | ||||||||||||
Payments | (1,615) | (2,212) | (2,105) | (9,475) | [1] | |||||||||
Balance, end of year | 1,326 | 789 | 1,326 | 789 | 1,183 | 1,326 | ||||||||
Employee severance [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 1,398 | 1,341 | 1,398 | 1,341 | 884 | |||||||||
Charges | 4,148 | 2,168 | 1,937 | 12,512 | [1] | |||||||||
Reversals | (1,200) | (93) | (64) | (1,668) | [1] | |||||||||
Inter-segment transfer | [1] | (14) | ||||||||||||
Payments | (2,949) | (2,018) | (1,416) | (9,433) | [1] | |||||||||
Balance, end of year | 1,397 | 1,398 | 1,397 | 1,398 | 1,341 | 1,397 | ||||||||
Employee severance [Member] | Reportable business segments [Member] | Direct Checks [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 140 | 7 | 140 | 7 | 0 | |||||||||
Charges | 0 | 143 | 143 | 322 | [1] | |||||||||
Reversals | (5) | (4) | (2) | (13) | [1] | |||||||||
Inter-segment transfer | [1] | 0 | ||||||||||||
Payments | (135) | (6) | (134) | (309) | [1] | |||||||||
Balance, end of year | 0 | 140 | 0 | 140 | 7 | 0 | ||||||||
Employee severance [Member] | Corporate [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | [2] | 2,049 | 1,650 | 2,049 | 1,650 | 1,859 | ||||||||
Charges | [2] | 842 | 3,500 | 2,503 | 10,856 | [1] | ||||||||
Reversals | [2] | (163) | (356) | (429) | (1,226) | [1] | ||||||||
Inter-segment transfer | [1],[2] | (27) | ||||||||||||
Payments | [2] | (2,272) | (2,745) | (2,283) | (9,147) | [1] | ||||||||
Balance, end of year | [2] | 456 | 2,049 | 456 | 2,049 | 1,650 | 456 | |||||||
Operating lease obligations [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Charges | 597 | 23 | 59 | |||||||||||
Reversals | (71) | 0 | 0 | |||||||||||
Operating lease obligations [Member] | Reportable business segments [Member] | Small Business Services [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | 4 | 0 | 4 | 0 | 56 | |||||||||
Charges | 306 | 23 | 59 | 673 | [1] | |||||||||
Reversals | 0 | 0 | 0 | 0 | [1] | |||||||||
Inter-segment transfer | [1] | 0 | ||||||||||||
Payments | (28) | (19) | (115) | (391) | [1] | |||||||||
Balance, end of year | 282 | 4 | 282 | 4 | 0 | 282 | ||||||||
Operating lease obligations [Member] | Reportable business segments [Member] | Financial Services [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Balance, beginning of year | $ 0 | $ 0 | 0 | 0 | 42 | |||||||||
Charges | 291 | 0 | 0 | 344 | [1] | |||||||||
Reversals | (71) | 0 | 0 | (71) | [1] | |||||||||
Inter-segment transfer | [1] | 0 | ||||||||||||
Payments | (220) | 0 | 42 | (273) | [1] | |||||||||
Balance, end of year | $ 0 | $ 0 | 0 | 0 | 0 | 0 | ||||||||
Employee severance and operating lease obligations [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Charges | 8,269 | 7,866 | 7,276 | 37,780 | ||||||||||
Reversals | [1] | (5,291) | ||||||||||||
Employee severance and operating lease obligations [Member] | 2018 initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Charges | 8,136 | 0 | 0 | 8,136 | ||||||||||
Employee severance and operating lease obligations [Member] | 2017 Initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Charges | 133 | 7,222 | 0 | 7,355 | ||||||||||
Employee severance and operating lease obligations [Member] | 2016 initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Charges | 0 | 603 | 7,198 | 7,801 | ||||||||||
Employee severance and operating lease obligations [Member] | 2014 and 2015 initiatives [Member] | ||||||||||||||
Restructuring and integration accruals [Line Items] | ||||||||||||||
Charges | $ 0 | $ 41 | $ 78 | $ 14,488 | ||||||||||
[1] | Includes accruals related to our cost reduction and integration initiatives for 2014 through 2018. | |||||||||||||
[2] | As discussed in Note 18, corporate costs are allocated to our business segments. As such, the net corporate charges are reflected in the business segment operating income presented in Note 18 in accordance with our allocation methodology. |
CEO transition costs (Details)
CEO transition costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2018 | |
Retention bonus, amount | $ 2,000 | $ 2,000 | |||
Impact of modification of share-based payment award | 2,088 | 2,088 | |||
CEO transition costs | 3,058 | $ 2,622 | $ 1,530 | $ 0 | 7,210 |
Accrued liabilities [Member] | |||||
CEO transition costs accruals | 1,972 | 1,972 | |||
Other non-current liabilities [Member] | |||||
CEO transition costs accruals | $ 1,808 | $ 1,808 | |||
Maximum [Member] | |||||
Retention bonus, percentage | 150.00% | 150.00% |
Income tax provision (Details)
Income tax provision (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income before income taxes | |||||||||||
United States | $ 198,727 | $ 299,424 | $ 325,396 | ||||||||
Foreign | 13,904 | 13,403 | 14,990 | ||||||||
Income before income taxes | 212,631 | 312,827 | 340,386 | ||||||||
Current tax provision: | |||||||||||
Federal | 57,117 | 104,079 | 93,261 | ||||||||
State | 11,319 | 12,996 | 12,006 | ||||||||
Foreign | 5,921 | 4,774 | 3,851 | ||||||||
Total current tax provision | 74,357 | 121,849 | 109,118 | ||||||||
Deferred tax provision: | |||||||||||
Federal | (7,220) | (37,471) | 1,752 | ||||||||
State | (1,701) | (491) | 462 | ||||||||
Foreign | (2,435) | (1,215) | (328) | ||||||||
Total deferred tax provision | (11,356) | (39,177) | 1,886 | ||||||||
Income tax provision | $ 63,001 | $ 82,672 | $ 111,004 | ||||||||
Reconciliation of effective tax rate | |||||||||||
Income tax at federal statutory rate | 21.00% | 35.00% | 35.00% | ||||||||
Goodwill impairment charge | 7.10% | 1.50% | 0.00% | ||||||||
State income tax, net of federal income tax benefit | 3.00% | 2.70% | 2.40% | ||||||||
Impact of Tax Cuts and Jobs Act | (0.80%) | (6.60%) | 0.00% | ||||||||
Qualified production activities deduction | 0.00% | (3.20%) | (2.80%) | ||||||||
Net tax benefit of share-based compensation | (0.80%) | (1.60%) | (1.20%) | ||||||||
Other | 0.10% | (1.40%) | (0.80%) | ||||||||
Effective tax rate | 29.60% | 26.40% | 32.60% | ||||||||
Impact of Tax Cuts and Jobs Act | $ (582) | $ (1,249) | $ 441 | $ (310) | $ (20,500) | $ 0 | $ 0 | $ 0 | $ (1,700) | $ (20,500) | |
Changes in unrecognized tax benefits | |||||||||||
Balance, beginning of year | $ 3,795 | $ 7,373 | 3,795 | 7,373 | $ 5,743 | ||||||
Additions for tax positions of current year | 315 | 378 | 521 | ||||||||
Additions for tax positions of prior years | 1,177 | 659 | 1,428 | ||||||||
Reductions for tax positions of prior years | (108) | (4,389) | (177) | ||||||||
Lapse of statutes of limitations | (378) | (226) | (142) | ||||||||
Balance, end of year | 4,801 | 3,795 | 4,801 | 3,795 | 7,373 | ||||||
Unrecognized tax benefits | |||||||||||
Unrecognized tax benefits that would impact income tax expense | 4,801 | 4,801 | |||||||||
Accruals for interest and penalties | 1,156 | $ 1,046 | 1,156 | 1,046 | |||||||
Net increase (decrease) in income tax provision for interest and penalties | 110 | $ (284) | $ 179 | ||||||||
Amount by which it is reasonably possible that unrecognized tax benefits will decrease in next 12 months | 3,200 | 3,200 | |||||||||
Amount by which it is reasonably possible that unrecognized tax benefits will increase in next 12 months | $ 1,800 | $ 1,800 |
Income tax provision (deferred
Income tax provision (deferred income taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Deferred tax assets | |||
Net operating loss, capital loss and tax credit carryforwards | $ 9,380 | $ 11,802 | |
Reserves and accruals | 8,893 | 6,151 | |
Inventories | 2,043 | 2,110 | |
All other | 4,657 | 3,895 | |
Total deferred taxes | 24,973 | 23,958 | |
Valuation allowances | (1,689) | (1,518) | |
Net deferred taxes | 23,284 | 22,440 | |
Deferred tax liabilities | |||
Goodwill | 47,993 | 45,317 | |
Intangible assets | 3,780 | 7,490 | |
Prepaid assets | 3,469 | 3,137 | |
Installment sales treatment of notes receivable | 3,054 | 2,450 | |
Deferred advertising costs | 1,948 | 1,920 | |
Property, plant and equipment | 1,739 | 8,122 | |
All other | 5,095 | 3,119 | |
Total deferred taxes | 67,078 | 71,555 | |
Net deferred taxes | 67,078 | 71,555 | |
Income tax (benefit) provision, change in valuation allowance | (290) | (1,015) | $ (302) |
Cash and cash equivalents | 59,740 | $ 59,240 | $ 76,574 |
Foreign, primarily Canada [Member] | |||
Deferred tax liabilities | |||
Cash and cash equivalents | $ 51,310 |
Income tax provision (net opera
Income tax provision (net operating loss, capital loss and tax credit carryforwards) (Details) $ in Thousands | Dec. 31, 2018USD ($) |
State [Member] | |
Tax carryforwards [Line Items] | |
Net operating loss, capital loss and tax credit carryforwards | $ 56,713 |
Foreign [Member] | |
Tax carryforwards [Line Items] | |
Capital loss and net operating loss carryforwards that do not expire | 6,733 |
Net operating loss, capital loss and tax credit carryforwards | 6,238 |
Federal [Member] | |
Tax carryforwards [Line Items] | |
Net operating loss, capital loss and tax credit carryforwards | $ 1,708 |
Share-based compensation plan_2
Share-based compensation plans (long-term incentive plan and share-based compensation expense) (Details) $ in Thousands, shares in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($)shares | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Share-based compensation plans [Line Items] | |||
Common stock reserved for issuance | shares | 5 | ||
Common stock available for issuance | shares | 5.4 | ||
Full value awards factor (in ones) | 2.23 | ||
Share-based compensation expense | $ 13,378 | $ 15,109 | $ 12,459 |
Income tax benefit | (3,946) | (5,152) | (4,063) |
Compensation expense not yet recognized for unvested awards | $ 16,683 | ||
Weighted-average period over which expense for unvested awards will be recognized | 2 years 1 month 6 days | ||
Restricted shares and restricted stock units [Member] | |||
Share-based compensation plans [Line Items] | |||
Share-based compensation expense | $ 5,232 | 6,533 | 5,786 |
Performance share awards [Member] | |||
Share-based compensation plans [Line Items] | |||
Share-based compensation expense | 4,502 | 4,782 | 2,806 |
Stock options [Member] | |||
Share-based compensation plans [Line Items] | |||
Share-based compensation expense | 3,143 | 3,270 | 3,401 |
Employee stock purchase plan [Member] | |||
Share-based compensation plans [Line Items] | |||
Share-based compensation expense | $ 501 | $ 524 | $ 466 |
Share-based compensation plan_3
Share-based compensation plans (award terms) (Details) | 12 Months Ended |
Dec. 31, 2018shares | |
Stock options [Member] | |
Share-based compensation plans [Line Items] | |
Options vesting each year during vesting period | 33.30% |
Term of award | 7 years |
Period after grant when vesting of stock options may be modified in certain circumstances outlined in award agreement | 1 year |
Exercise period of award following voluntary termination of employment | 3 months |
Number of shares of common stock into which each award is convertible | 1 |
Stock options [Member] | Minimum [Member] | |
Share-based compensation plans [Line Items] | |
Award vesting period | 1 year |
Stock options [Member] | Maximum [Member] | |
Share-based compensation plans [Line Items] | |
Award vesting period | 3 years |
Restricted stock units [Member] | |
Share-based compensation plans [Line Items] | |
Number of shares of common stock into which each award is convertible | 1 |
Restricted stock units [Member] | Management [Member] | |
Share-based compensation plans [Line Items] | |
Award vesting period | 2 years |
Company matching amount, restricted stock units | 50.00% |
Restricted shares [Member] | |
Share-based compensation plans [Line Items] | |
Options vesting each year during vesting period | 33.30% |
Restricted shares [Member] | Minimum [Member] | |
Share-based compensation plans [Line Items] | |
Award vesting period | 1 year |
Restricted shares [Member] | Maximum [Member] | |
Share-based compensation plans [Line Items] | |
Award vesting period | 3 years |
Performance share awards [Member] | |
Share-based compensation plans [Line Items] | |
Award vesting period | 3 years |
Period after grant when vesting of stock options may be modified in certain circumstances outlined in award agreement | 1 year |
Share-based compensation plan_4
Share-based compensation plans (stock options) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Weighted-average exercise price per option | |||
Outstanding, beginning of year | $ 56.51 | $ 47.68 | $ 40.11 |
Granted | 62.12 | 75.30 | 54.44 |
Exercised | 42.55 | 38.72 | 30.80 |
Forfeited or expired | 66.85 | 62.19 | 58.06 |
Outstanding, end of year | 62.04 | 56.51 | 47.68 |
Exercisable, end of year | $ 59.90 | $ 47.42 | $ 38.50 |
Change in number of stock options | |||
Outstanding, beginning of year | 1,139 | 1,251 | 1,354 |
Granted | 519 | 270 | 458 |
Exercised | (339) | (347) | (476) |
Forfeited or expired | (74) | (35) | (85) |
Outstanding, end of year | 1,245 | 1,139 | 1,251 |
Exercisable, end of year | 472 | 555 | 624 |
Additional disclosures | |||
Aggregate intrinsic value, options outstanding, end of year | $ 127 | ||
Aggregate intrinsic value, options exercisable, end of year | $ 127 | ||
Weighted average remaining contractual term, options outstanding, end of year | 5 years | ||
Weighted-average remaining contractual term, options exercisable, end of year | 3 years 6 months | ||
Weighted-average grant date fair value, options granted | $ 10.98 | $ 12.81 | $ 9.16 |
Total intrinsic value, options exercised | $ 10,007 | $ 11,699 | $ 16,043 |
Stock options [Member] | |||
Assumptions, Black-Scholes option pricing model | |||
Risk-free interest rate | 2.70% | 1.60% | 1.10% |
Dividend yield | 2.00% | 1.60% | 2.20% |
Expected volatility | 23.00% | 23.70% | 25.50% |
Weighted-average option life (in years) | 3 years 10 months 24 days | 3 years 8 months 12 days | 4 years |
Share-based compensation plan_5
Share-based compensation plans (restricted stock units, restricted shares and performance share awards) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Restricted stock units [Member] | ||||
Changes in share-based compensation awards (in thousands) | ||||
Outstanding, beginning of year | 109 | 139 | 167 | |
Granted | 110 | 16 | 38 | |
Vested | (22) | (43) | (46) | |
Forfeited | (2) | (3) | (20) | |
Outstanding, end of year | 195 | 109 | 139 | |
Weighted-average grant date fair value | ||||
Outstanding, beginning of year | $ 38.31 | $ 37.99 | $ 34.74 | |
Granted | 52.32 | 73.27 | 55.39 | |
Vested | 48.14 | 43.18 | 40.15 | |
Forfeited | 74.96 | 57.18 | 58.69 | |
Outstanding, end of year | $ 45.41 | $ 38.31 | $ 37.99 | |
Additional disclosures | ||||
Weighted-average remaining contractual term, outstanding, end of year | 3 years 3 months 18 days | |||
Fair value, awards vested | $ 1,619 | $ 3,161 | $ 2,805 | |
Restricted stock units classified as liabilities [Member] | ||||
Changes in share-based compensation awards (in thousands) | ||||
Outstanding, end of year | 14 | |||
Additional disclosures | ||||
Aggregate intrinsic value, outstanding, end of year | $ 546 | |||
Weighted-average remaining contractual term, outstanding, end of year | 7 months | |||
Fair value per unit, end of year | $ 38.44 | |||
Cash payments to settle restricted stock units | $ 78 | $ 421 | $ 140 | |
Restricted shares [Member] | ||||
Changes in share-based compensation awards (in thousands) | ||||
Outstanding, beginning of year | 181 | 220 | 170 | |
Granted | 77 | 68 | 97 | |
Vested | (76) | (99) | (22) | |
Forfeited | (14) | (8) | (25) | |
Outstanding, end of year | 168 | 181 | 220 | |
Weighted-average grant date fair value | ||||
Outstanding, beginning of year | $ 65.33 | $ 56.43 | $ 56.35 | |
Granted | 71.29 | 74.84 | 56.22 | |
Vested | 69.73 | 52.41 | 56.63 | |
Forfeited | 66.24 | 61.37 | 56.86 | |
Outstanding, end of year | $ 66.02 | $ 65.33 | $ 56.43 | |
Additional disclosures | ||||
Weighted-average remaining contractual term, outstanding, end of year | 1 year 1 month 6 days | |||
Fair value, awards vested | $ 5,375 | $ 7,452 | $ 1,398 | |
Performance share awards [Member] | ||||
Assumptions, Monte Carlo simulation model | ||||
Risk-free interest rate | 2.40% | 1.40% | 0.90% | |
Dividend yield | 1.60% | 1.70% | 2.30% | |
Expected volatility | 21.60% | 21.90% | 22.70% | |
Changes in share-based compensation awards (in thousands) | ||||
Outstanding, beginning of year | 255 | 236 | 122 | |
Granted | [1] | 91 | 83 | 153 |
Vested | (45) | (60) | ||
Forfeited | (48) | (9) | (39) | |
Adjustment for performance results achieved | [2] | (3) | 5 | |
Outstanding, end of year | 250 | 255 | 236 | |
Weighted-average grant date fair value | ||||
Outstanding, beginning of year | $ 63.42 | $ 55.15 | $ 58.13 | |
Granted | 74.49 | 75.31 | 52.75 | |
Vested | 67.10 | 50.17 | ||
Forfeited | 59.32 | 64.85 | 55.04 | |
Adjustment for performance results achieved | 67.11 | 50.34 | ||
Outstanding, end of year | $ 67.54 | $ 63.42 | $ 55.15 | |
Additional disclosures | ||||
Weighted-average remaining contractual term, outstanding, end of year | 1 year 1 month 6 days | |||
[1] | Reflects awards granted assuming achievement of performance goals at target. | |||
[2] | Reflects the difference between the awards earned at the end of the performance period and the target number of shares. |
Share-based compensation plan_6
Share-based compensation plans (employee stock purchase plan) (Details) - $ / shares shares in Thousands | 12 Months Ended | ||||||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jul. 31, 2018 | Jan. 31, 2018 | Jul. 31, 2017 | Jan. 31, 2017 | Jul. 29, 2016 | Jan. 29, 2016 | |
Employee stock purchase plan | |||||||||
Number of shares issued, employee stock purchase plan | 53 | 46 | 48 | ||||||
Purchase price per share, employee stock purchase plan | $ 50.09 | $ 63.13 | $ 61.37 | $ 61.92 | $ 57.45 | $ 47.52 |
Employee compensation plans (De
Employee compensation plans (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Employee compensation plans [Line Items] | ||||
401(k) contributions, maximum annual employee contribution, percent of wages | 50.00% | |||
401(k) expense | $ 9,686 | $ 9,023 | $ 8,309 | |
Performance-based compensation plans | [1] | 20,297 | 22,085 | $ 19,730 |
Deferred compensation plan | ||||
Deferred compensation plan liability | 4,458 | 4,581 | ||
Deferred compensation plan assets | $ 10,831 | $ 11,648 | ||
Maximum [Member] | ||||
Deferred compensation plan | ||||
Maximum percentage of base salary employees can defer | 100.00% | |||
Maximum percentage of bonus employees can defer | 50.00% | |||
401(k) plan, first 1% of wages contributed by employee [Member] | ||||
Employee compensation plans [Line Items] | ||||
Employer matching 401(k) contribution, percentage | 100.00% | |||
401(k) plan, next 5% of wages contributed by employee [Member] | ||||
Employee compensation plans [Line Items] | ||||
Employer matching 401(k) contribution, percentage | 50.00% | |||
401(k) plan, 100% employer match [Member] | ||||
Employee compensation plans [Line Items] | ||||
Employee 401(k) contribution receiving employer match, percent of wages | 1.00% | |||
401(k) plan, 50% employer match [Member] | ||||
Employee compensation plans [Line Items] | ||||
Employee 401(k) contribution receiving employer match, percent of wages | 5.00% | |||
[1] | Excludes expense for share-based compensation, which is discussed in Note 12. |
Postretirement benefits (obliga
Postretirement benefits (obligations and funded status) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Change in benefit obligation | |||
Interest cost | $ 2,626 | $ 2,896 | $ 3,118 |
Amounts recognized in balance sheets | |||
Other non-current assets | 41,259 | 39,849 | |
Amounts recognized in accumulated other comprehensive loss | |||
Unrecognized prior service credit | 14,178 | 15,599 | |
Unrecognized net actuarial loss | (57,436) | (55,174) | |
Tax effect | 6,729 | 12,746 | |
Amount recognized in accumulated other comprehensive loss, net of tax | (36,529) | (26,829) | |
Postretirement benefit plan [Member] | |||
Change in benefit obligation | |||
Benefit obligation, beginning of year | 87,594 | 94,188 | |
Interest cost | 2,529 | 2,794 | |
Net actuarial (gain) loss | (9,231) | (1,469) | |
Benefits paid from plan assets and company funds | (7,175) | (7,919) | |
Benefit obligation, end of year | 73,717 | 87,594 | 94,188 |
Change in plan assets | |||
Fair value of plan assets, beginning of year | 127,443 | 118,128 | |
Return on plan assets | (6,663) | 15,309 | |
Benefits paid | (5,804) | (5,994) | |
Fair value of plan assets, end of year | 114,976 | 127,443 | 118,128 |
Funded status | 41,259 | 39,849 | |
Amounts recognized in balance sheets | |||
Other non-current assets | 41,259 | 39,849 | |
Accrued liabilities | 0 | 0 | |
Other non-current liabilities | $ 0 | 0 | |
Amounts recognized in accumulated other comprehensive loss | |||
Weighted-average amortization period, prior service credit | 21 years | ||
Amortization period net actuarial loss | 14 years 3 months 18 days | ||
Pension plan [Member] | |||
Change in benefit obligation | |||
Benefit obligation, beginning of year | $ 3,398 | 3,447 | |
Interest cost | 97 | 101 | |
Net actuarial (gain) loss | (23) | 174 | |
Benefits paid from plan assets and company funds | (324) | (324) | |
Benefit obligation, end of year | 3,148 | 3,398 | $ 3,447 |
Change in plan assets | |||
Funded status | (3,148) | (3,398) | |
Amounts recognized in balance sheets | |||
Other non-current assets | 0 | 0 | |
Accrued liabilities | 324 | 324 | |
Other non-current liabilities | $ 2,824 | $ 3,074 |
Postretirement benefits (net pe
Postretirement benefits (net periodic benefit income and actuarial assumptions) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net periodic benefit income | |||
Interest cost | $ 2,626 | $ 2,896 | $ 3,118 |
Expected return on plan assets | (7,737) | (7,128) | (7,335) |
Amortization of prior service credit | (1,421) | (1,421) | (1,421) |
Amortization of net actuarial losses | 2,884 | 3,637 | 3,797 |
Net periodic benefit income | $ (3,648) | $ (2,016) | (1,841) |
Actuarial assumptions | |||
Change in discount rate assumption, financial effect | $ (881) | ||
Participants under age 65 [Member] | |||
Health care cost trend rates | |||
Health care cost trend rate assumed for next year | 7.70% | 7.90% | 7.50% |
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) | 4.50% | 4.50% | 4.50% |
Year that the rate reaches the ultimate trend rate | 2,029 | 2,025 | 2,025 |
Participants age 65 and older [Member] | |||
Health care cost trend rates | |||
Health care cost trend rate assumed for next year | 8.70% | 9.10% | 8.75% |
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) | 4.50% | 4.50% | 4.50% |
Year that the rate reaches the ultimate trend rate | 2,029 | 2,025 | 2,025 |
Postretirement benefit plan [Member] | |||
Net periodic benefit income | |||
Interest cost | $ 2,529 | $ 2,794 | |
Actuarial assumptions | |||
Discount rate, benefit obligation | 4.13% | 3.46% | |
Discount rate, net periodic benefit income | 3.46% | 3.81% | 4.02% |
Expected return on plan assets | 6.25% | 6.25% | 6.50% |
Pension plan [Member] | |||
Net periodic benefit income | |||
Interest cost | $ 97 | $ 101 | |
Actuarial assumptions | |||
Discount rate, benefit obligation | 4.01% | 3.35% | |
Discount rate, net periodic benefit income | 3.35% | 3.66% | 3.88% |
Postretirement benefits (plan a
Postretirement benefits (plan assets) (Details) - Postretirement benefit plan [Member] - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Postretirement benefits [Line Items] | |||
Allocation of plan assets | 100.00% | 100.00% | |
Fair value of plan assets | $ 114,976 | $ 127,443 | $ 118,128 |
Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 30,003 | 26,751 | |
Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 39,450 | 43,975 | |
Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | $ 45,523 | $ 56,717 | |
Fixed income securities [Member] | |||
Postretirement benefits [Line Items] | |||
Target allocation of plan assets | 55.00% | ||
Mortgage-backed securities [Member] | |||
Postretirement benefits [Line Items] | |||
Allocation of plan assets | 25.00% | 23.00% | |
Fair value of plan assets | $ 28,731 | $ 28,662 | |
Mortgage-backed securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Mortgage-backed securities [Member] | Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 13,593 | 13,274 | |
Mortgage-backed securities [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Mortgage-backed securities [Member] | Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | $ 15,138 | $ 15,388 | |
Equity securities [Member] | United States [Member] | |||
Postretirement benefits [Line Items] | |||
Allocation of plan assets | 23.00% | 24.00% | |
Target allocation of plan assets | 24.00% | ||
Fair value of plan assets | $ 26,240 | $ 30,167 | |
Equity securities [Member] | United States [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Equity securities [Member] | United States [Member] | Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Equity securities [Member] | United States [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Equity securities [Member] | United States [Member] | Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | $ 26,240 | $ 30,167 | |
U.S. corporate debt securities [Member] | |||
Postretirement benefits [Line Items] | |||
Allocation of plan assets | 20.00% | 18.00% | |
Fair value of plan assets | $ 22,551 | $ 23,238 | |
U.S. corporate debt securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 6,489 | 0 | |
U.S. corporate debt securities [Member] | Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 12,468 | 13,032 | |
U.S. corporate debt securities [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
U.S. corporate debt securities [Member] | Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | $ 3,594 | $ 10,206 | |
International equity securities [Member] | |||
Postretirement benefits [Line Items] | |||
Allocation of plan assets | 18.00% | 18.00% | |
Target allocation of plan assets | 18.00% | ||
Fair value of plan assets | $ 20,559 | $ 23,467 | |
International equity securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 20,261 | 23,127 | |
International equity securities [Member] | Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 298 | 340 | |
International equity securities [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
International equity securities [Member] | Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Government debt securities [Member] | |||
Postretirement benefits [Line Items] | |||
Allocation of plan assets | 11.00% | 13.00% | |
Fair value of plan assets | $ 12,738 | $ 17,118 | |
Government debt securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Government debt securities [Member] | Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 12,738 | 17,118 | |
Government debt securities [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Government debt securities [Member] | Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Equity securities small and midcap [Member] | United States [Member] | |||
Postretirement benefits [Line Items] | |||
Allocation of plan assets | 3.00% | 4.00% | |
Target allocation of plan assets | 3.00% | ||
Fair value of plan assets | $ 3,837 | $ 4,502 | |
Equity securities small and midcap [Member] | United States [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 3,259 | 3,490 | |
Equity securities small and midcap [Member] | United States [Member] | Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 27 | 56 | |
Equity securities small and midcap [Member] | United States [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Equity securities small and midcap [Member] | United States [Member] | Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 551 | 956 | |
Other debt securities [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 320 | 289 | |
Other debt securities [Member] | Quoted prices in active markets for identical assets (Level 1) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | (6) | 134 | |
Other debt securities [Member] | Significant other observable inputs (Level 2) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 326 | 155 | |
Other debt securities [Member] | Significant unobservable inputs (Level 3) [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Other debt securities [Member] | Investments measured at net asset value [Member] | |||
Postretirement benefits [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 |
Postretirement benefits (cash f
Postretirement benefits (cash flows) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Postretirement benefits [Line Items] | |||
Company contributions | $ 0 | $ 0 | $ 0 |
Cash surrender value of insurance polices which fund pension plan | 6,869 | $ 6,615 | |
Postretirement benefit plan [Member] | |||
Expected benefit payments | |||
2,019 | 7,679 | ||
2,020 | 7,906 | ||
2,021 | 7,730 | ||
2,022 | 7,219 | ||
2,023 | 6,686 | ||
2024 - 2028 | 26,205 | ||
Pension plan [Member] | |||
Expected benefit payments | |||
2,019 | 320 | ||
2,020 | 320 | ||
2,021 | 310 | ||
2,022 | 300 | ||
2,023 | 300 | ||
2024 - 2028 | $ 1,320 |
Debt and lease obligations (deb
Debt and lease obligations (debt) (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Nov. 30, 2016USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jan. 22, 2019USD ($) | Nov. 15, 2016USD ($) | Nov. 30, 2012USD ($) | ||
Debt instruments [Line Items] | ||||||||
Capital lease obligations | $ 1,864 | $ 1,914 | ||||||
Long-term debt, principal amount | 911,864 | 709,852 | ||||||
Less unamortized debt issuance costs | 0 | (471) | ||||||
Less current portion of long-term debt | (791) | (44,121) | ||||||
Long-term debt | 911,073 | 665,260 | ||||||
Less unamortized debt issuance costs | 0 | (81) | ||||||
Long-term debt due within one year | 791 | 44,040 | ||||||
Total debt | $ 911,864 | 709,300 | ||||||
Total debt less unrestricted cash to EBITDA ratio | 2.75 | |||||||
Loss on early debt extinguishment | $ 0 | 0 | $ 7,858 | |||||
Revolving credit facility, current capacity | [1] | 950,000 | ||||||
Revolving credit facility, maximum capacity | $ 1,425,000 | |||||||
Leverage ratio | 3.5 | |||||||
Ratio of EBIT to interest expense | 3 | |||||||
Outstanding letters of credit | [2] | $ (10,221) | ||||||
Net available for borrowing as of December 31, 2018 | $ 29,779 | |||||||
Forecast [Member] | ||||||||
Debt instruments [Line Items] | ||||||||
Revolving credit facility, current capacity | $ 1,150,000 | |||||||
Line of credit facility increase in current capacity | $ 200,000 | |||||||
Minimum [Member] | ||||||||
Debt instruments [Line Items] | ||||||||
Revolving credit facility, commitment fee | 0.175% | |||||||
Maximum [Member] | ||||||||
Debt instruments [Line Items] | ||||||||
Revolving credit facility, commitment fee | 0.35% | |||||||
Revolving credit facility [Member] | ||||||||
Debt instruments [Line Items] | ||||||||
Principal amount | $ 910,000 | $ 413,000 | ||||||
Interest rate at period end | 3.79% | 2.98% | ||||||
Daily average amount outstanding | $ 731,110 | $ 436,588 | $ 417,219 | |||||
Weighted-average interest rate | 3.24% | 2.55% | 1.93% | |||||
Term loan facility [Member] | ||||||||
Debt instruments [Line Items] | ||||||||
Principal amount | $ 0 | $ 294,938 | ||||||
Less current portion of long-term debt | 0 | (43,313) | ||||||
Principal amount issued | $ 330,000 | |||||||
Interest rate at period end | 2.99% | |||||||
Daily average amount outstanding | $ 63,638 | $ 315,862 | $ 52,381 | |||||
Weighted-average interest rate | 2.97% | 2.57% | 1.52% | |||||
Capital lease obligations [Member] | ||||||||
Debt instruments [Line Items] | ||||||||
Less current portion of long-term debt | $ (791) | $ (808) | ||||||
Senior notes due 2020 [Member] | ||||||||
Debt instruments [Line Items] | ||||||||
Principal amount issued | $ 200,000 | |||||||
Stated interest rate | 6.00% | |||||||
Principal amount retired | $ 200,000 | |||||||
Loss on early debt extinguishment | $ 7,858 | |||||||
Fair value adjustment to hedged item | $ (2,842) | |||||||
[1] | In January 2019, we increased the credit facility by $200,000 , bringing the total availability to $1,150,000 | |||||||
[2] | We use standby letters of credit primarily to collateralize certain obligations related to our self-insured workers' compensation claims, as well as claims for environmental matters, as required by certain states. These letters of credit reduce the amount available for borrowing under our revolving credit facility. |
Debt and lease obligations (lea
Debt and lease obligations (lease obligations) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Capital lease obligations [Line Items] | |||
Capital lease obligations | $ 1,864 | $ 1,914 | |
Capital lease obligations, future payments | |||
2,019 | 822 | ||
2,020 | 637 | ||
2,021 | 365 | ||
2,022 | 91 | ||
2,023 | 0 | ||
Thereafter | 0 | ||
Total minimum lease payments | 1,915 | ||
Less portion representing interest | (51) | ||
Present value of minimum lease payments | 1,864 | ||
Operating lease obligations, future payments | |||
2,019 | 16,479 | ||
2,020 | 13,240 | ||
2,021 | 9,001 | ||
2,022 | 5,792 | ||
2,023 | 3,263 | ||
Thereafter | 11,056 | ||
Total minimum lease payments | 58,831 | ||
Rental expense | 23,928 | 19,839 | $ 16,454 |
Machinery and equipment [Member] | |||
Capital lease obligations [Line Items] | |||
Machinery and equipment | 6,413 | 4,676 | |
Accumulated depreciation | (4,673) | (3,522) | |
Net assets under capital leases | $ 1,740 | $ 1,154 |
Other commitments and conting_2
Other commitments and contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Environmental matters [Line Items] | |||
Accruals for environmental matters | $ 2,755 | $ 2,646 | |
Expense for environmental matters | 750 | 348 | $ (1,692) |
Self-insurance | |||
Self-insurance liabilities | 6,627 | $ 7,679 | |
Environmental insurance policy purchased during 2002 [Member] | |||
Environmental matters [Line Items] | |||
Environmental insurance coverage | 10,000 | ||
Environmental insurance policy purchased during 2009 [Member] | |||
Environmental matters [Line Items] | |||
Environmental insurance coverage | 15,000 | ||
Environmental insurance policies in effect [Member] | |||
Environmental matters [Line Items] | |||
Accruals for environmental matters | $ 0 |
Shareholders' equity (Details)
Shareholders' equity (Details) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 24, 2018 | May 31, 2016 | |
Common shares repurchased | |||||
Share repurchase authorization | $ 500,000 | $ 300,000 | |||
Common shares repurchased | 3,584 | 924 | 901 | ||
Payments for common shares repurchased | $ 200,000 | $ 65,000 | $ 55,224 | ||
Remaining authorized repurchase amount | $ 420,000 |
Business segment information (d
Business segment information (disaggregated revenue information) (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018USD ($)customers | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($)customers | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)customers | Dec. 31, 2017USD ($)customers | Dec. 31, 2016USD ($)customers | |
Product Information [Line Items] | |||||||||||
Number of reportable segments | 3 | ||||||||||
Total revenue | $ 524,677 | $ 493,190 | $ 488,244 | $ 491,914 | $ 494,889 | $ 497,669 | $ 485,232 | $ 487,766 | $ 1,998,025 | $ 1,965,556 | $ 1,849,062 |
United States [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 1,871,375 | 1,859,398 | 1,776,701 | ||||||||
Foreign, primarily Canada and Australia [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 126,650 | 106,158 | 72,361 | ||||||||
Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 1,283,620 | 1,239,739 | 1,195,743 | ||||||||
Reportable business segments [Member] | Small Business Services [Member] | United States [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 1,180,019 | 1,150,055 | 1,123,382 | ||||||||
Reportable business segments [Member] | Small Business Services [Member] | Foreign, primarily Canada and Australia [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 103,601 | 89,684 | 72,361 | ||||||||
Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 586,967 | 585,275 | 499,976 | ||||||||
Reportable business segments [Member] | Financial Services [Member] | United States [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 563,918 | 568,801 | 499,976 | ||||||||
Reportable business segments [Member] | Financial Services [Member] | Foreign, primarily Canada and Australia [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 23,049 | 16,474 | 0 | ||||||||
Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 127,438 | 140,542 | 153,343 | ||||||||
Reportable business segments [Member] | Direct Checks [Member] | United States [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 127,438 | 140,542 | 153,343 | ||||||||
Reportable business segments [Member] | Direct Checks [Member] | Foreign, primarily Canada and Australia [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Small business marketing solutions [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 292,245 | 262,192 | 242,710 | ||||||||
Small business marketing solutions [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 292,245 | 262,192 | 242,710 | ||||||||
Small business marketing solutions [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Small business marketing solutions [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Web services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 161,646 | 131,644 | 115,226 | ||||||||
Web services [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 161,646 | 131,644 | 115,226 | ||||||||
Web services [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Web services [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Data-driven marketing solutions [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 147,893 | 150,572 | 50,022 | ||||||||
Data-driven marketing solutions [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Data-driven marketing solutions [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 147,893 | 150,572 | 50,022 | ||||||||
Data-driven marketing solutions [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Treasury management solutions [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 148,011 | 109,240 | 92,259 | ||||||||
Treasury management solutions [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Treasury management solutions [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 148,011 | 109,240 | 92,259 | ||||||||
Treasury management solutions [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 0 | 0 | 0 | ||||||||
Fraud, security, risk management and operational services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 90,105 | 102,030 | 116,700 | ||||||||
Fraud, security, risk management and operational services [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 25,460 | 25,491 | 26,948 | ||||||||
Fraud, security, risk management and operational services [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 50,499 | 61,185 | 72,940 | ||||||||
Fraud, security, risk management and operational services [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 14,146 | 15,354 | 16,812 | ||||||||
Marketing solutions and other services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 839,900 | 755,678 | 616,917 | ||||||||
Marketing solutions and other services [Member] | Recognized at point in time [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 293,708 | ||||||||||
Marketing solutions and other services [Member] | Recognized over time [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 546,192 | ||||||||||
Marketing solutions and other services [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 479,351 | 419,327 | 384,884 | ||||||||
Marketing solutions and other services [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 346,403 | 320,997 | 215,221 | ||||||||
Marketing solutions and other services [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 14,146 | 15,354 | 16,812 | ||||||||
Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 810,389 | 851,036 | 865,285 | ||||||||
Checks [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 476,751 | 482,928 | 467,386 | ||||||||
Checks [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 226,554 | 249,716 | 268,926 | ||||||||
Checks [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 107,084 | 118,392 | 128,973 | ||||||||
Forms, accessories and other products [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 347,736 | 358,842 | 366,860 | ||||||||
Forms, accessories and other products [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 327,518 | 337,484 | 343,473 | ||||||||
Forms, accessories and other products [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | 14,010 | 14,562 | 15,829 | ||||||||
Forms, accessories and other products [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Total revenue | $ 6,208 | $ 6,796 | $ 7,558 | ||||||||
Customer concentration risk [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Number of customers | customers | 0 | 0 | 0 | 0 | 0 | ||||||
Customer concentration risk [Member] | Total revenue benchmark [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Concentration risk, percentage | 10.00% | 10.00% | 10.00% | ||||||||
Product concentration risk [Member] | Marketing solutions and other services [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Concentration risk, percentage | 37.30% | ||||||||||
Product concentration risk [Member] | Marketing solutions and other services [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Concentration risk, percentage | 59.00% | ||||||||||
Product concentration risk [Member] | Marketing solutions and other services [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Concentration risk, percentage | 11.10% | ||||||||||
Product concentration risk [Member] | Checks [Member] | Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Concentration risk, percentage | 37.10% | ||||||||||
Product concentration risk [Member] | Checks [Member] | Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Concentration risk, percentage | 38.60% | ||||||||||
Product concentration risk [Member] | Checks [Member] | Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Product Information [Line Items] | |||||||||||
Concentration risk, percentage | 84.00% |
Business segment information (s
Business segment information (segment results) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Business segment information [Line Items] | |||||||||||
Total revenue from external customers: | $ 524,677 | $ 493,190 | $ 488,244 | $ 491,914 | $ 494,889 | $ 497,669 | $ 485,232 | $ 487,766 | $ 1,998,025 | $ 1,965,556 | $ 1,849,062 |
Operating income | 231,221 | 329,176 | 366,887 | ||||||||
Depreciation and amortization expense: | 131,100 | 122,652 | 91,583 | ||||||||
Asset impairment charges | 0 | $ 99,170 | $ 0 | $ 2,149 | 0 | $ 46,630 | $ 2,954 | $ 5,296 | 101,319 | 54,880 | 0 |
Total assets | 2,305,096 | 2,208,827 | 2,305,096 | 2,208,827 | 2,184,338 | ||||||
Capital asset purchases: | 62,238 | 47,450 | 46,614 | ||||||||
Reportable business segments [Member] | Small Business Services [Member] | |||||||||||
Business segment information [Line Items] | |||||||||||
Total revenue from external customers: | 1,283,620 | 1,239,739 | 1,195,743 | ||||||||
Operating income | 119,808 | 181,528 | 207,581 | ||||||||
Depreciation and amortization expense: | 66,031 | 56,834 | 52,195 | ||||||||
Asset impairment charges | 99,437 | 54,880 | 0 | ||||||||
Total assets | 1,094,262 | 1,081,098 | 1,094,262 | 1,081,098 | 1,086,500 | ||||||
Capital asset purchases: | 0 | 0 | 0 | ||||||||
Reportable business segments [Member] | Financial Services [Member] | |||||||||||
Business segment information [Line Items] | |||||||||||
Total revenue from external customers: | 586,967 | 585,275 | 499,976 | ||||||||
Operating income | 69,939 | 101,047 | 106,335 | ||||||||
Depreciation and amortization expense: | 61,843 | 62,592 | 35,850 | ||||||||
Asset impairment charges | 1,882 | 0 | 0 | ||||||||
Total assets | 751,242 | 679,547 | 751,242 | 679,547 | 631,353 | ||||||
Capital asset purchases: | 0 | 0 | 0 | ||||||||
Reportable business segments [Member] | Direct Checks [Member] | |||||||||||
Business segment information [Line Items] | |||||||||||
Total revenue from external customers: | 127,438 | 140,542 | 153,343 | ||||||||
Operating income | 41,474 | 46,601 | 52,971 | ||||||||
Depreciation and amortization expense: | 3,226 | 3,226 | 3,538 | ||||||||
Asset impairment charges | 0 | 0 | 0 | ||||||||
Total assets | 157,802 | 158,827 | 157,802 | 158,827 | 161,039 | ||||||
Capital asset purchases: | 0 | 0 | 0 | ||||||||
Corporate [Member] | |||||||||||
Business segment information [Line Items] | |||||||||||
Depreciation and amortization expense related to corporate assets which was allocated to segments | 33,812 | 33,302 | 32,785 | ||||||||
Total revenue from external customers: | 0 | 0 | 0 | ||||||||
Operating income | 0 | 0 | 0 | ||||||||
Depreciation and amortization expense: | 0 | 0 | 0 | ||||||||
Asset impairment charges | 0 | 0 | 0 | ||||||||
Total assets | $ 301,790 | $ 289,355 | 301,790 | 289,355 | 305,446 | ||||||
Capital asset purchases: | $ 62,238 | $ 47,450 | $ 46,614 |
SUMMARIZED QUARTERLY FINANCIA_3
SUMMARIZED QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | 60 Months Ended | ||||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2015 | |||
Quarterly Financial Data [Abstract] | |||||||||||||||
Total revenue | $ 524,677 | $ 493,190 | $ 488,244 | $ 491,914 | $ 494,889 | $ 497,669 | $ 485,232 | $ 487,766 | $ 1,998,025 | $ 1,965,556 | $ 1,849,062 | ||||
Gross profit | 309,522 | 295,556 | 298,043 | 303,156 | 303,935 | 304,598 | 305,864 | 308,452 | 1,206,277 | 1,222,849 | 1,181,249 | ||||
Net income (loss) | $ 57,170 | $ (31,083) | $ 60,207 | $ 63,336 | $ 84,709 | $ 28,801 | $ 59,579 | $ 57,066 | $ 149,630 | $ 230,155 | $ 229,382 | ||||
Earnings (loss) per share: | |||||||||||||||
Earnings per share - basic | $ 1.25 | $ (0.67) | $ 1.26 | $ 1.32 | $ 1.76 | $ 0.60 | $ 1.23 | $ 1.17 | $ 3.18 | $ 4.75 | $ 4.68 | ||||
Earnings per share - diluted | 1.25 | (0.67) | 1.25 | 1.31 | 1.75 | 0.59 | 1.22 | 1.16 | 3.16 | 4.72 | 4.65 | ||||
Cash dividends per share | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 0.30 | $ 1.20 | $ 1.20 | $ 1.20 | ||||
Items affecting comparability of quarterly results | |||||||||||||||
Asset impairment charges | $ 0 | $ 99,170 | $ 0 | $ 2,149 | $ 0 | $ 46,630 | $ 2,954 | $ 5,296 | $ 101,319 | $ 54,880 | $ 0 | ||||
Restructuring and integration expense | 7,406 | 5,104 | 6,371 | 2,322 | 5,438 | 1,242 | 1,457 | 993 | 21,203 | 9,130 | 7,771 | $ 37,780 | [1] | ||
Gain on sales of businesses and customer lists | 2,786 | 1,765 | 3,862 | 7,228 | 0 | 1,924 | 0 | 6,779 | 15,641 | 8,703 | 0 | ||||
Certain litigation | 7,769 | 1,805 | 631 | 297 | |||||||||||
CEO transition costs | 3,058 | 2,622 | 1,530 | 0 | 7,210 | ||||||||||
Impact of Tax Cuts and Jobs Act | (582) | (1,249) | 441 | (310) | (20,500) | 0 | 0 | 0 | (1,700) | (20,500) | |||||
Other discrete income tax (benefit) expense | [2] | (1,987) | 15,634 | (1,167) | (579) | (1,843) | 4,555 | (1,276) | (3,664) | ||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents | |||||||||||||||
Cash, cash equivalents, restricted cash and restricted cash equivalents | $ 145,259 | $ 126,114 | $ 145,303 | $ 146,479 | $ 128,819 | $ 115,172 | $ 105,479 | $ 160,000 | $ 145,259 | $ 128,819 | $ 148,865 | $ 145,259 | $ 100,703 | ||
[1] | Includes accruals related to our cost reduction and integration initiatives for 2014 through 2018. | ||||||||||||||
[2] | Relates primarily to the tax effects of share-based compensation and the non-deductible portion of goodwill impairment charges in the third quarter of each year. |