Document And Entity Information
Document And Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 21, 2018 | Jun. 30, 2017 | |
Document Information [Line Items] | |||
Trading Symbol | MDCA | ||
Entity Registrant Name | MDC PARTNERS INC | ||
Entity Central Index Key | 876,883 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 0 | ||
Common Class A | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 58,432,677 | ||
Common Class B | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 3,755 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue: | |||
Services | $ 1,513,779,000 | $ 1,385,785,000 | $ 1,326,256,000 |
Operating Expenses: | |||
Cost of services sold | 1,023,476,000 | 936,133,000 | 879,716,000 |
Office and general expenses | 310,455,000 | 306,251,000 | 322,207,000 |
Depreciation and amortization | 43,474,000 | 46,446,000 | 52,223,000 |
Asset Impairment Charges | 4,415,000 | 48,524,000 | 0 |
Costs and Expenses, Total | 1,381,820,000 | 1,337,354,000 | 1,254,146,000 |
Operating income | 131,959,000 | 48,431,000 | 72,110,000 |
Other Income (Expenses): | |||
Other income, net | 1,346,000 | 414,000 | 7,238,000 |
Foreign exchange gain (loss) | 18,137,000 | (213,000) | (39,328,000) |
Interest expense and finance charges | (65,123,000) | (57,903,000) | |
Loss on redemption of Notes | 0 | (33,298,000) | 0 |
Interest income | 759,000 | 808,000 | 467,000 |
Nonoperating Income (Expense), Total | (44,881,000) | (98,147,000) | (89,526,000) |
Income (loss) from continuing operations before income taxes and equity in earnings of non-consolidated affiliates | 87,078,000 | (49,716,000) | (17,416,000) |
Income tax (benefit) expense | (168,064,000) | (9,404,000) | 3,761,000 |
Income (loss) from continuing operations before equity in earnings of non-consolidated affiliates | 255,142,000 | (40,312,000) | (21,177,000) |
Equity in earnings (losses) of non-consolidated affiliates | 2,081,000 | (309,000) | 1,058,000 |
Income (loss) from continuing operations | 257,223,000 | (40,621,000) | (20,119,000) |
Loss from discontinued operations attributable to MDC Partners Inc., net of taxes | 0 | 0 | (6,281,000) |
Net income (loss) | 257,223,000 | (40,621,000) | (26,400,000) |
Net income attributable to the noncontrolling interests | (15,375,000) | (5,218,000) | (9,054,000) |
Net income (loss) attributable to MDC Partners Inc. | 241,848,000 | (45,839,000) | (35,454,000) |
Accretion on Convertible Preferred Shares | (6,352,000) | 0 | 0 |
Net Income (Loss) Available to Common Stockholders, Basic | $ 235,496,000 | $ (45,839,000) | $ (35,454,000) |
Income (Loss) from Continuing Operations, Per Basic Share | $ 3.72 | $ (0.89) | $ (0.58) |
Basic | |||
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Basic Share | 0 | 0 | (0.13) |
Earnings Per Share, Basic | 3.72 | (0.89) | (0.71) |
Income (Loss) from Continuing Operations, Per Diluted Share | 3.71 | (0.89) | (0.58) |
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Diluted Share | 0 | 0 | (0.13) |
Earnings Per Share, Diluted | $ 3.71 | $ (0.89) | $ (0.71) |
Weighted Average Number of Shares Outstanding, Basic | 55,255,797 | 51,345,807 | 49,875,282 |
Stock-based compensation expense is included in the following line items above: | |||
Cost of services sold | $ 24,350,000 | $ 21,003,000 | $ 17,796,000 |
Share-based Compensation | $ 24,350,000 | $ 21,003,000 | $ 17,796,000 |
Weighted Average Number of Shares Outstanding, Diluted | 55,481,786 | 51,345,807 | 49,875,282 |
Cost of Sales [Member] | |||
Stock-based compensation expense is included in the following line items above: | |||
Cost of services sold | $ 19,015,000 | $ 14,237,000 | $ 11,710,000 |
Share-based Compensation | 19,015,000 | 14,237,000 | 11,710,000 |
General and Administrative Expense [Member] | |||
Stock-based compensation expense is included in the following line items above: | |||
Cost of services sold | 5,335,000 | 6,766,000 | 6,086,000 |
Share-based Compensation | $ 5,335,000 | $ 6,766,000 | $ 6,086,000 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Comprehensive Income (Loss) | |||
Net income (loss) | $ 257,223 | $ (40,621) | $ (26,400) |
Other comprehensive income (loss), net of applicable tax: | |||
Foreign currency translation adjustment | 3,611 | (4,586) | 9,564 |
Benefit plan adjustment, net of income tax benefit, $528 for 2017, nil for 2016, and nil for 2015 | (1,336) | (3,101) | (423) |
Other comprehensive income (loss) | 2,275 | (7,687) | 9,141 |
Comprehensive income (loss) for the year | 259,498 | (48,308) | (17,259) |
Comprehensive income attributable to the noncontrolling interests | (17,780) | (5,612) | (4,186) |
Comprehensive income (loss) attributable to MDC Partners Inc. | $ 241,718 | $ (53,920) | $ (21,445) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Current Assets: | |||
Cash and cash equivalents | $ 46,179 | $ 27,921 | $ 61,458 |
Cash held in trust | 4,632 | 5,341 | |
Accounts receivable, less allowance for doubtful accounts of $2,453 and $1,523 | 434,072 | 388,340 | |
Inventory, Work in Process, Gross | 31,146 | 33,118 | |
Other current assets | 26,742 | 34,862 | |
Total Current Assets | 542,771 | 489,582 | |
Fixed assets, at cost, less accumulated depreciation of $123,599 and $105,134 | 90,306 | 78,377 | |
Investment in non-consolidated affiliates | 6,307 | 4,745 | |
Goodwill | 835,935 | 844,759 | 870,301 |
Other intangible assets, net | 70,605 | 85,071 | |
Deferred tax assets | 115,325 | 41,793 | |
Other assets | 37,643 | 33,051 | |
Total Assets | 1,698,892 | 1,577,378 | |
Current Liabilities: | |||
Accounts payable | 244,527 | 251,456 | |
Trust Liability, Current | 4,632 | 5,341 | |
Accrued Liabilities and Other Liabilities | 327,812 | 303,581 | |
Advance billings | 148,133 | 133,925 | |
Current portion of long-term debt | 313 | 228 | |
Total Current Liabilities | 775,630 | 802,821 | |
Long-term debt, less current portion | 882,806 | 936,208 | |
Other liabilities | 54,110 | 56,012 | |
Deferred tax liabilities | 6,760 | 110,359 | |
Total Liabilities | 1,791,519 | 2,026,674 | |
Redeemable Noncontrolling Interest, Equity, Redemption Value | 62,886 | 60,180 | |
Commitments, Contingencies and Guarantees (See Note 17) | |||
Shareholders’ Deficit: | |||
Convertible preference shares (liquidation preference $101,352) | 90,220 | 0 | |
Common Stock, Value, To be Issued | 0 | 2,360 | |
Charges in excess of capital | (314,241) | (311,581) | |
Accumulated deficit | (340,000) | (581,848) | |
Accumulated other comprehensive loss | (1,954) | (1,824) | 6,257 |
MDC Partners Inc. Shareholders’ Deficit | (213,543) | (575,109) | |
Noncontrolling Interests | 58,030 | 65,633 | |
Total Shareholders’ Deficit | (155,513) | (509,476) | $ (496,092) |
Total Liabilities, Redeemable Noncontrolling Interests and Shareholders’ Deficit | 1,698,892 | 1,577,378 | |
Common Class A | |||
Shareholders’ Deficit: | |||
Common stock | 352,432 | 317,784 | |
Contingent and fixed payments [Member] | |||
Current Liabilities: | |||
Current portion of deferred acquisition consideration | 50,213 | 108,290 | |
Long-term portion of deferred acquisition consideration | $ 72,213 | $ 121,274 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 2,453 | $ 1,523 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | $ 123,599 | $ 105,133 |
Preferred stock, shares issued | 0 | 0 |
Common Stock, Shares, To be Issued | 100,000 | 100,000 |
Common Class A | ||
Common stock, shares issued | 58,432,677 | 52,798,303 |
Common stock, shares outstanding | 58,432,677 | 52,798,303 |
Common Stock, Par or Stated Value Per Share | $ 0 | $ 0 |
Common Class B | ||
Common stock, shares issued | 3,755 | 3,755 |
Common stock, shares outstanding | 3,755 | 3,755 |
Common Stock, Par or Stated Value Per Share | $ 0 | $ 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS | 12 Months Ended | ||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Cash flows provided by (used in) operating activities: | |||
Net income (loss) | $ 257,223,000 | $ (40,621,000) | $ (26,400,000) |
Loss from discontinued operations | 0 | 0 | (6,281,000) |
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest | 257,223,000 | (40,621,000) | (20,119,000) |
Share-based Compensation | 24,350,000 | 21,003,000 | 17,796,000 |
Adjustments to reconcile income (loss) from continuing operations to cash provided by (used in) operating activities: | |||
Depreciation | 23,873,000 | 22,293,000 | 18,871,000 |
Amortization of intangibles | 19,601,000 | 24,153,000 | 33,352,000 |
Amortization of deferred finance charges and debt discount | 3,022,000 | 9,135,000 | 2,270,000 |
Asset Impairment Charges | 4,415,000 | 48,524,000 | 0 |
Loss on redemption of Notes | 0 | 26,873,000 | 0 |
Adjustment to deferred acquisition consideration | (4,819,000) | 8,227,000 | 38,887,000 |
Deferred income taxes | (173,019,000) | (10,038,000) | (79,000) |
Earnings (losses) of non-consolidated affiliates | (2,081,000) | 309,000 | (1,058,000) |
Distributions from non-consolidated affiliates | 3,672,000 | 7,402,000 | 0 |
Other and non-current assets and liabilities | (4,420,000) | 13,527,000 | 4,680,000 |
Foreign exchange | (17,637,000) | (8,240,000) | 30,185,000 |
Changes in working capital: | |||
Accounts receivable | (50,030,000) | (16,752,000) | (4,796,000) |
Increase (Decrease) in Inventories | (1,892,000) | (13,048,000) | 3,879,000 |
Prepaid expenses and other current assets | 6,569,000 | (13,608,000) | 1,550,000 |
Accounts payable, accruals and other current liabilities | 13,398,000 | (110,018,000) | 75,111,000 |
Increase (Decrease) in Deferred Revenue | 14,548,000 | 11,397,000 | (23,508,000) |
Cash flows provided by (used in) continuing operating activities | 115,285,000 | (1,212,000) | 162,737,000 |
Discontinued operations | 0 | 0 | (1,342,000) |
Net cash provided by (used in) operating activities | 115,285,000 | (1,212,000) | 161,395,000 |
Gain (Loss) on Disposition of Assets | (1,600,000) | (424,000) | (6,526,000) |
Cash flows used in investing activities: | |||
Capital expenditures | (32,958,000) | (29,432,000) | (23,575,000) |
Increase (Decrease) in Deposit Assets | 0 | 2,528,000 | 0 |
Payments for (Proceeds from) Investments | 10,631,000 | 666,000 | 8,631,000 |
Acquisitions, net of cash acquired | 0 | 2,531,000 | (24,778,000) |
Other investments | (2,229,000) | (3,835,000) | (7,272,000) |
Cash flows used in continuing investing activities | (20,884,000) | (25,196,000) | (46,994,000) |
Discontinued operations | 0 | 0 | 17,101,000 |
Net cash used in investing activities | (20,884,000) | (25,196,000) | (29,893,000) |
Cash flows used in financing activities: | |||
Acquisition related payments | (99,873,000) | (135,693,000) | (134,056,000) |
Distributions to noncontrolling interests | (8,865,000) | (7,772,000) | (9,503,000) |
Payment of dividends | (284,000) | (32,918,000) | (42,313,000) |
Repayment of long-term debt | (404,000) | (507,000) | (534,000) |
Premium paid on redemption of Notes | 0 | (26,873,000) | 0 |
Deferred financing costs | 0 | (21,569,000) | 0 |
Purchase of shares | (1,758,000) | (3,350,000) | (2,388,000) |
Other | 0 | 0 | 224,000 |
Cash flows used in continuing financing activities | (75,389,000) | (9,257,000) | (188,570,000) |
Discontinued operations | 0 | 0 | (40,000) |
Net cash used in financing activities | (75,389,000) | (9,257,000) | (188,610,000) |
Effect of exchange rate changes on cash and cash equivalents | (754,000) | 2,128,000 | 5,218,000 |
(Decrease) increase in cash and cash equivalents | 18,258,000 | (33,537,000) | (51,890,000) |
Cash and cash equivalents at beginning of year | 27,921,000 | 61,458,000 | 113,348,000 |
Cash and cash equivalents at end of year | 46,179,000 | 27,921,000 | 61,458,000 |
Supplemental disclosures: | |||
Cash income taxes paid | 8,099,000 | 2,895,000 | 1,887,000 |
Cash interest paid | 62,895,000 | 64,671,000 | 52,666,000 |
Change in cash held in trusts | (709,000) | 219,000 | (1,297,000) |
Non-cash transactions: | |||
Capital leases | 670,000 | 265,000 | 140,000 |
Notes Receivable in exchange for shares of subsidiary | 6,139,000 | 0 | 0 |
Dividends Payable | 453,000 | 739,000 | 912,000 |
Stock Issued During Period, Value, New Issues | 27,852,000 | ||
Stock Issued During Period, Value, Acquisitions | 34,219,000 | ||
Leasehold improvements financed by landlord | 0 | 7,250,000 | 0 |
Six Point Five Zero Percentage Notes [Domain] | |||
Cash flows used in financing activities: | |||
Proceeds from issuance of notes | 0 | 900,000,000 | 0 |
6.75% Notes | |||
Cash flows used in financing activities: | |||
Repayment of 6.75% Notes | 0 | (735,000,000) | 0 |
Wells Fargo Capital Finance, Llc [Member] | Revolving Credit Facility [Member] | |||
Cash flows used in financing activities: | |||
Repayments of Lines of Credit | (1,479,632,000) | (1,790,108,000) | (703,020,000) |
Proceeds from Lines of Credit | 1,425,207,000 | 1,844,533,000 | 703,020,000 |
Series 4 Convertible Preferred Stock [Domain] | |||
Cash flows used in financing activities: | |||
Proceeds from Issuance of Convertible Preferred Stock | 95,000,000 | 0 | 0 |
Convertible Preferred Stock [Member] | |||
Cash flows used in financing activities: | |||
Payments of Stock Issuance Costs | (4,780,000) | 0 | 0 |
Common Stock [Member] | |||
Non-cash transactions: | |||
Stock Issued During Period, Value, New Issues | 28,727,000 | ||
Common Stock [Member] | Common Class A | |||
Non-cash transactions: | |||
Stock Issued During Period, Value, New Issues | 28,727 | 10,458,000 | 0 |
Forsman & Bodenfors AB [Domain] | Common Stock [Member] | Common Class A | |||
Non-cash transactions: | |||
Stock Issued During Period, Value, Acquisitions | $ 0 | $ 34,219,000 | $ 0 |
CONSOLIDATED STATEMENTS OF CAS7
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) | Dec. 31, 2016 | Dec. 31, 2014 | Dec. 31, 2013 | Mar. 20, 2013 |
6.75% Notes | ||||
Stated interest rate | 6.75% | 6.75% | 6.75% | 6.75% |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT) - USD ($) | Total | Common Class B [Member] | Common Class A | Common Stock | Common StockCommon Class B [Member] | Common StockCommon Class A | Share Capital to Be Issued | Additional Paid-in Capital | Charges in Excess of Capital | Retained Earnings [Member] | Stock Subscription Receivable | Accumulated Other Comprehensive Loss | MDC Partners Inc. Shareholders’ Deficit | Preferred Stock [Member]Series 4 Convertible Preferred Stock [Domain] | Noncontrolling Interests | AOCI Including Portion Attributable to Noncontrolling Interest [Member] | Forsman & Bodenfors AB [Domain]Common StockCommon Class A | Contingent Consideration Classified as Equity [Member]MDC Partners Inc. Shareholders’ Deficit | Contingent Consideration, Liability Settlements [Domain] | Contingent Consideration, Liability Settlements [Domain]MDC Partners Inc. Shareholders’ Deficit |
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | $ 0 | $ 6,069,000 | $ (6,069,000) | |||||||||||||||||
Noncontrolling Interest, Increase from Business Combination | (51,488,000) | 42,780,000 | $ 42,780,000 | $ 8,708,000 | ||||||||||||||||
Stockholders' equity, beginning balance at Dec. 31, 2014 | 0 | $ (209,668,000) | $ 0 | $ (7,752,000) | (452,157,000) | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Net loss attributable to MDC Partners | (35,454,000) | (35,454,000) | ||||||||||||||||||
Other comprehensive income (loss) | 9,141,000 | 14,009,000 | 14,009,000 | (4,868,000) | ||||||||||||||||
Shares acquired and canceled | (2,388,000) | $ (2,388,000) | (2,388,000) | |||||||||||||||||
Shares acquired and cancelled (in shares) | (96,777) | |||||||||||||||||||
Options Exercised | 224,000 | $ 343,000 | (119,000) | 224,000 | ||||||||||||||||
Options Exercised (in shares) | 37,500 | |||||||||||||||||||
Stock-based compensation | 8,437,000 | 8,437,000 | 8,437,000 | |||||||||||||||||
Dividends paid and to be paid | (42,253,000) | (42,253,000) | (42,253,000) | |||||||||||||||||
Transfer to charges in excess of capital | 0 | 105,593,000 | (105,593,000) | |||||||||||||||||
Common stock outstanding, ending balance (in shares) at Dec. 31, 2015 | 49,990,460 | 49,990,460 | 0 | |||||||||||||||||
Stockholders' equity, ending balance at Dec. 31, 2015 | $ (496,092,000) | $ 269,842,000 | $ 269,842,000 | $ 0 | 0 | (315,261,000) | $ (536,009,000) | 0 | 6,257,000 | (575,171,000) | 79,079,000 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 365,873 | |||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 0 | |||||||||||||||||||
Stock Issued During Period, Value, New Issues | $ 0 | |||||||||||||||||||
Stock Issued During Period, Value, Acquisitions | $ 0 | |||||||||||||||||||
Temporary Equity, Accretion to Redemption Value | $ (22,809,000) | 22,809,000 | 22,809,000 | |||||||||||||||||
Noncontrolling Interest, Increase from Business Combination | (8,936,000) | (22,776,000) | (22,776,000) | 13,840,000 | ||||||||||||||||
Net loss attributable to MDC Partners | (45,839,000) | (45,839,000) | ||||||||||||||||||
Other comprehensive income (loss) | (7,687,000) | (8,081,000) | (8,081,000) | 394,000 | ||||||||||||||||
Issuance of restricted stock (in shares) | 425,915 | |||||||||||||||||||
Stock Issued During Period, Value, Restricted Stock and Stock Options, Net of Forfeitures | 0 | $ 6,615,000 | (6,615,000) | 0 | ||||||||||||||||
Shares acquired and canceled | (3,350,000) | $ (3,350,000) | (3,350,000) | |||||||||||||||||
Shares acquired and cancelled (in shares) | (205,876) | |||||||||||||||||||
Stock-based compensation | 10,662,000 | 10,662,000 | 10,662,000 | |||||||||||||||||
Dividends paid and to be paid | (32,747,000) | (32,747,000) | (32,747,000) | |||||||||||||||||
Transfer to charges in excess of capital | 0 | (3,680,000) | 3,680,000 | |||||||||||||||||
Common stock outstanding, ending balance (in shares) at Dec. 31, 2016 | 3,755 | 52,798,303 | 52,802,058 | 100,000 | ||||||||||||||||
Stockholders' equity, ending balance at Dec. 31, 2016 | $ (509,476,000) | $ 317,784,000 | $ 2,360,000 | 0 | (311,581,000) | (581,848,000) | 0 | $ (1,824,000) | (575,109,000) | $ 0 | 65,633,000 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Stock Issued During Period, Shares, New Issues | 0 | 691,559 | ||||||||||||||||||
Stock Issued During Period, Value, New Issues | $ 10,458,000 | $ 12,818,000 | $ 12,818,000 | |||||||||||||||||
Stock Issued During Period, Shares, Acquisitions | 1,900,000 | |||||||||||||||||||
Stock Issued During Period, Value, Acquisitions | $ 34,219,000 | 34,219,000 | $ 34,219,000 | |||||||||||||||||
Temporary Equity, Accretion to Redemption Value | $ (9,604,000) | (9,604,000) | (9,604,000) | |||||||||||||||||
Common Stock, Shares, To be Issued | 100,000 | |||||||||||||||||||
Common Stock, Value, To be Issued | $ 2,360,000 | |||||||||||||||||||
Shares, Outstanding | 0 | |||||||||||||||||||
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | 0 | $ 7,679,000 | (7,679,000) | 0 | ||||||||||||||||
Noncontrolling Interest, Increase from Business Combination | (6,960,000) | 5,654,000 | 5,654,000 | (12,614,000) | ||||||||||||||||
Noncontrolling Interest, Decrease from Deconsolidation | (10,657,000) | |||||||||||||||||||
Net loss attributable to MDC Partners | 241,848,000 | 241,848,000 | ||||||||||||||||||
Other comprehensive income (loss) | 2,275,000 | (130,000) | 2,405,000 | $ (130,000) | ||||||||||||||||
Stock Appreciation Rights Exercised (in shares) | (100,000) | |||||||||||||||||||
Stock Authorized During Period, Value, To be Issued | $ (2,360,000) | |||||||||||||||||||
Shares acquired and canceled | (1,758,000) | $ (1,758,000) | (1,758,000) | |||||||||||||||||
Shares acquired and cancelled (in shares) | (161,535) | |||||||||||||||||||
Stock-based compensation | 8,028,000 | 8,028,000 | 8,028,000 | |||||||||||||||||
Transfer to charges in excess of capital | 2,660,000 | (2,660,000) | ||||||||||||||||||
Common stock outstanding, ending balance (in shares) at Dec. 31, 2017 | 3,755 | 58,432,677 | ||||||||||||||||||
Stockholders' equity, ending balance at Dec. 31, 2017 | $ (155,513,000) | $ 352,432,000 | 0 | $ (314,241,000) | $ (340,000,000) | $ 0 | $ (213,543,000) | $ 90,220,000 | 58,030,000 | $ (1,954,000) | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Stock Issued During Period, Shares, Convertible Preferred Shares | 90,220,000 | 90,220,000 | 95,000,000 | |||||||||||||||||
Stock Issued During Period, Value, Convertible Preferred Shares | $ 90,220,000 | |||||||||||||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 380,669 | |||||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | $ 9,650,000 | (2,315,000) | $ (2,315,000) | $ 11,965,000 | ||||||||||||||||
Stock Issued During Period, Shares, New Issues | 3,353,939 | 3,353,939 | ||||||||||||||||||
Stock Issued During Period, Value, New Issues | 27,852,000 | $ 28,727,000 | $ 28,727 | 1,485,000 | 27,852,000 | |||||||||||||||
Stock Issued During Period, Value, Acquisitions | $ 0 | |||||||||||||||||||
Temporary Equity, Accretion to Redemption Value | (1,498,000) | 1,498,000 | 1,498,000 | |||||||||||||||||
Adjustments to Additional Paid in Capital, Other | $ 343,000 | $ 343,000 | $ 343,000 | |||||||||||||||||
Common Stock, Shares, To be Issued | 100,000 | 0 | ||||||||||||||||||
Common Stock, Value, To be Issued | $ 0 | $ 0 | ||||||||||||||||||
Shares, Outstanding | 56,375,131 | 95,000,000 |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation MDC Partners Inc. (the “Company” or “MDC”) has prepared the consolidated financial statements included herein pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) and in accordance with generally accepted accounting principles of the United States of America (“U.S. GAAP”). Nature of Operations MDC is a leading provider of global marketing, advertising, activation, communications and strategic consulting solutions. MDC’s Partner Firms deliver a wide range of customized services in order to drive growth and business performance for its clients. MDC Partners Inc., formerly MDC Corporation Inc., is incorporated under the laws of Canada. The Company commenced using the name MDC Partners Inc. on November 1, 2003 and legally changed its name through amalgamation with a wholly-owned subsidiary on January 1, 2004. The Company operates primarily in the U.S., Canada, Europe, Asia, and Latin America. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | . Significant Accounting Policies The Company’s significant accounting policies are summarized as follows: Principles of Consolidation . The accompanying consolidated financial statements include the accounts of MDC Partners Inc. and its domestic and international controlled subsidiaries that are not considered variable interest entities, and variable interest entities for which the Company is the primary beneficiary. Intercompany balances and transactions have been eliminated in consolidation. Reclassifications. Certain reclassifications have been made to the prior period financial statements to conform to the current period presentation. Use of Estimates . The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities including goodwill, intangible assets, contingent deferred acquisition consideration, valuation allowances for receivables, deferred tax assets and the amounts of revenue and expenses reported during the period. These estimates are evaluated on an ongoing basis and are based on historical experience, current conditions and various other assumptions believed to be reasonable under the circumstances. Actual results could differ from these estimates. Fair Value . The Company applies the fair value measurement guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “ASC”) Topic 820, Fair Value Measurements, for financial assets and liabilities that are required to be measured at fair value and for non-financial assets and liabilities that are not required to be measured at fair value on a recurring basis, including goodwill and other identifiable intangible assets. The measurement of fair value requires the use of techniques based on observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The inputs create the following fair value hierarchy: • Level 1 - Quoted prices for identical instruments in active markets. • Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations where inputs are observable or where significant value drivers are observable. • Level 3 - Instruments where significant value drivers are unobservable to third parties. When available, the Company uses quoted market prices to determine the fair value of its financial instruments and classifies such items in Level 1. In some cases, quoted market prices are used for similar instruments in active markets and the Company classifies such items in Level 2. Concentration of Credit Risk . The Company provides marketing communications services to clients who operate in most industry sectors. Credit is granted to qualified clients in the ordinary course of business. Due to the diversified nature of the Company’s client base, the Company does not believe that it is exposed to a concentration of credit risk. No client accounted for more than 10% of the Company’s consolidated accounts receivable as of December 31, 2017 and 2016 . No clients accounted for 10% of the Company’s revenue in each of the years ended December 31, 2017 , 2016 , and 2015 . Cash and Cash Equivalents . The Company’s cash equivalents are primarily comprised of investments in overnight interest-bearing deposits, commercial paper and money market instruments and other short-term investments with original maturity dates of three months or less at the time of purchase. The Company has a concentration of credit risk in that there are cash deposits in excess of federally insured amounts. Cash in Trust. A subsidiary of the Company holds restricted cash in trust accounts related to funds received on behalf of clients. Such amounts are held in escrow under depositary service agreements and distributed at the direction of the clients. The funds are presented as a corresponding liability on the balance sheet. Allowance for Doubtful Accounts . Trade receivables are stated at invoiced amounts less allowances for doubtful accounts. The allowances represent estimated uncollectible receivables associated with potential customer defaults usually due to customers’ potential insolvency. The allowances include amounts for certain customers where a risk of default has been specifically identified. The assessment of the likelihood of customer defaults is based on various factors, including the length of time the receivables are past due, historical experience and existing economic conditions. Expenditures Billable to Clients . Expenditures billable to clients consist principally of outside vendor costs incurred on behalf of clients when providing advertising, marketing and corporate communications services that have not yet been invoiced to clients. Such amounts are invoiced to clients at various times over the course of the production process. Fixed Assets . Fixed assets are stated at cost, net of accumulated depreciation. Computers, furniture and fixtures are depreciated on a straight-line basis over periods of three to seven years. Leasehold improvements are depreciated on a straight-line basis over the lesser of the term of the related lease or the estimated useful life of the asset. Repairs and maintenance costs are expensed as incurred. Impairment of Long-lived Assets . In accordance with the FASB ASC, a long-lived asset or asset group is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. When such events occur, the Company compares the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group to the carrying amount of such asset or asset group. If this comparison indicates that there is an impairment, the amount of the impairment is typically calculated using discounted expected future cash flows where observable fair values are not readily determinable. The discount rate applied to these cash flows is based on the Company’s weighted average cost of capital (“WACC”), risk adjusted where appropriate. Equity Method Investments . The equity method is used to account for investments in entities in which the Company has an ownership interest of less than 50% and has significant influence, or joint control by contractual arrangement, (i) over the operating and financial policies of the affiliate or (ii) has an ownership interest greater than 50% ; however, the substantive participating rights of the noncontrolling interest shareholders preclude the Company from exercising unilateral control over the operating and financial policies of the affiliate. The Company’s investments that were accounted for using the equity method include various interests in investment funds. The Company’s management periodically evaluates these investments to determine if there has been a decline in value that is other than temporary. These investments are included in investments in non-consolidated affiliates. During the year ended December 31, 2016 , the Company sold its ownership in two of these equity method investments for $4,023 and recognized a gain of $623 in Other income. Cost Method Investments . From time to time, the Company makes non-material cost based investments in start-up advertising technology companies and innovative consumer product companies where the Company does not exercise significant influence over the operating and financial policies of the investee. The total net cost basis of these investments, which is included in Other Assets on the balance sheet, as of December 31, 2017 and 2016 was $9,527 and $10,132 , respectively. These investments are periodically evaluated to determine whether a significant event or change in circumstances has occurred that may impact the fair value of each investment other than temporary declines below book value. A variety of factors are considered when determining if a decline is other than temporary, including, among others, the financial condition and prospects of the investee, as well as the Company’s investment intent. During the year ended December 31, 2017 , the Company sold its ownership in three of these cost method investments for an aggregate purchase price of $3,557 and recognized a gain of $3,018 in Other income. In addition, the Company recognized a loss of $935 pertaining to the dissolution of five of these cost method investments. During the year ended December 31, 2016 , the Company sold its ownership in three of these cost method investments for an aggregate purchase price of $4,074 and recognized a gain of $1,309 in Other income. In addition, the Company’s partner agencies may receive noncontrolling equity interests from start-up companies in lieu of fees. These types of arrangements were not significant to the Company’s financial statements for the three years ended December 31, 2017. Goodwill and Indefinite Lived Intangibles . In accordance with the FASB ASC topic, Goodwill and Other Intangible Assets, goodwill and indefinite life intangible assets (trademarks) acquired as a result of a business combination which are not subject to amortization are tested for impairment annually as of October 1st of each year, or more frequently if indicators of potential impairment exist. For goodwill, impairment is assessed at the reporting unit level. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment, which eliminates step two from the two-step goodwill impairment test. Under the new guidance, an entity will perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value provided the loss recognized does not exceed the total amount of goodwill allocated to that reporting unit. This guidance is effective for annual or interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019. The Company has early adopted this guidance for its impairment test performed in 2017. For the annual impairment testing the Company has the option of assessing qualitative factors to determine whether it is more likely than not that the carrying amount of a reporting unit exceeds its fair value or performing a quantitative goodwill impairment test. Qualitative factors considered in the assessment include industry and market considerations, the competitive environment, overall financial performance, changing cost factors such as labor costs, and other factors specific to each reporting unit such as change in management or key personnel. If the Company elects to perform the qualitative assessment and concludes that it is more likely than not that the fair value of the reporting unit is more than its carrying amount, then goodwill is not considered impaired and the quantitative impairment test is not necessary. For reporting units for which the qualitative assessment concludes that it is more likely than not that the fair value of the reporting unit is less than its carrying amount and for reporting units for which the qualitative assessment is not performed, the Company will perform the quantitative impairment test, which compares the fair value of the reporting unit to its carrying amount. If the fair value of the reporting unit exceeds the carrying amount of the net assets assigned to that reporting unit, goodwill is not considered impaired. However, if the carrying amount of the net assets assigned to the reporting unit then the recognition of an impairment charge is required. Determining the fair value of a reporting unit involves the use of significant estimates and assumptions. For the 2017 annual impairment test, the Company used a combination of the income approach, which incorporates the use of the discounted cash flow (“DCF”) method, and the market approach, which incorporates the use of earnings and revenue multiples based on market data. The Company generally applied an equal weighting to the income and market approaches for the impairment test. The income approach and the market approach both require the exercise of significant judgment, including judgment about the amount and timing of expected future cash flows, assumed terminal value and appropriate discount rates. The DCF estimates incorporate expected cash flows that represent a spectrum of the amount and timing of possible cash flows of each reporting unit from a market participant perspective. The expected cash flows are developed as part of the Company’s routine long-range planning process using projections of revenue and expenses and related cash flows based on assumed long-term growth rates and demand trends and appropriate discount rates based on a reporting units WACC as determined by considering the observable WACC of comparable companies and factors specific to the reporting unit (for example, size). The terminal value is estimated using a constant growth method which requires an assumption about the expected long-term growth rate. The estimates are based on historical data and experience, industry projections, economic conditions, and the Company’s expectations. The assumptions used for the long-term growth rate and WACC in the annual goodwill impairment tests are as follows: October 1, 2017 Long-term growth rate 3% WACC 9.67% - 11.85% The Company’s reporting units vary in size with respect to revenue and operating profits. These differences drive variations in fair value of the reporting units. In addition, these differences as well as differences in book value, including goodwill, cause variations in the amount by which fair value exceeds the carrying amount of the reporting units. The reporting unit goodwill balances vary by reporting unit primarily because it relates specifically to the Partner Firm’s goodwill which was determined at the date of acquisition. For the 2017 annual goodwill impairment test, the Company had 32 reporting units, all of which were subject to the quantitative goodwill impairment test and the carrying amount of two of the Company’s reporting units exceeded their fair value, resulting in a partial impairment of goodwill of $3,238 . The fair value of all other reporting units were in excess of their respective carrying amounts and as a result there was no additional impairment of goodwill. The range of the excess of fair value over the carrying amount for the Company’s reporting units was from 12% to over 100% . The Company performed a sensitivity analysis which included a 1% increase to the WACC. Based on the results of that analysis, no additional reporting units were at risk of failing the quantitative impairment test. In addition, a reporting unit within the Domestic Creative Agencies segment to which $14,853 of goodwill is allocated had a negative carrying amount on December 31, 2017. The Company believes the estimates and assumptions used in the calculations are reasonable. However, if there was an adverse change in the facts and circumstances, then an impairment charge may be necessary in the future. The Company will monitor its reporting units to determine if there is an indicator of potential impairment. Should the fair value of any of the Company’s reporting units fall below its carrying amount because of reduced operating performance, market declines, changes in the discount rate, or other conditions, charges for impairment may be necessary. Subsequent to the annual impairment test at October 1, 2017 , there were no events or circumstances that triggered the need for an interim impairment test. Prior to the adoption of ASU 2017-04, the Company’s impairment tests used the income approach to estimate a reporting unit’s fair value. The income approach requires the exercise of significant judgment, including judgment about the amount and timing of expected future cash flows, assumed terminal value and appropriate discount rates. The Company’s quantitative impairment tests included two-steps. The first step compared the fair value of each reporting unit to their respective carrying amounts. If the fair value of the reporting unit exceeded the carrying amount of the net assets assigned to that reporting unit, goodwill was not considered impaired and additional analysis was not required. However, if the carrying amount of the net assets assigned to the reporting unit exceeded the fair value of the reporting unit, then the second step of the goodwill impairment test was performed to determine the implied fair value of the reporting unit’s goodwill. Under the second step of the goodwill impairment test, the Company utilized both a market approach and income approach to estimate the implied fair value of a reporting unit’s goodwill. For the market approach, the Company utilized both the guideline public company method and the precedent transaction method. For the income approach, the Company utilized a DCF method. The Company weighted the market and income approaches to arrive at an implied fair value of goodwill. If the Company determined that the carrying amount of a reporting unit’s goodwill exceeded its implied fair value, an impairment loss equal to the difference was recorded. During the third quarter of 2016, there was a change to the Company’s reporting units. This change, coupled with a decline in operating performance required the Company to perform interim goodwill testing on one of its experiential reporting units. Additionally, a triggering event occurred during the third quarter of 2016 that required the Company to perform interim goodwill testing on one non-material reporting unit. This interim impairment analysis resulted in a partial impairment of goodwill of $27,893 and $1,738 relating to the experiential reporting unit and non-material reporting unit, respectively. For the 2016 annual impairment test, a partial impairment of goodwill of $18,893 in one of the Company’s strategic communications reporting units. The fair value for all other reporting units were in excess of their respective carrying amounts and as a result there was no additional impairment of goodwill. In addition, a reporting unit within the All Other segment to which $5,479 of goodwill is allocated had a negative carrying amount on December 31, 2016. Indefinite-lived intangible assets are primarily evaluated on an annual basis, generally in conjunction with the Company’s evaluation of goodwill balances. There were no impairment indicators as of December 31, 2017. Definite Lived Intangible Assets . In accordance with the FASB ASC, acquired intangibles are subject to amortization over their useful lives. The method of amortization selected reflects the pattern in which the economic benefits of the specific intangible asset is consumed or otherwise used up. If that pattern cannot be reliably determined, a straight-line amortization method is used over the estimated useful life. Intangible assets that are subject to amortization are reviewed for potential impairment at least annually or whenever events or circumstances indicate that carrying amounts may not be recoverable. See Note 8 included herein for further information. Business Combinations. Business combinations are accounted for using the acquisition method and accordingly, the assets acquired (including identified intangible assets), the liabilities assumed and any noncontrolling interest in the acquired business are recorded at their acquisition date fair values. The Company’s acquisition model typically provides for an initial payment at closing and for future additional contingent purchase price obligations. Contingent purchase price obligations are recorded as deferred acquisition consideration on the balance sheet at the acquisition date fair value and are remeasured at each reporting period. Changes in such estimated values are recorded in the results of operations. For the years ended December 31, 2017 , 2016 and 2015 , operating income of $4,896 , and operating expense of $7,972 and $36,344 , respectively, was recorded pertaining to changes in the estimated value. For further information, see Note 4 and Note 13 of the Notes to the Consolidated Financial Statements included herein. For the years ended December 31, 2017 , 2016 , and 2015 , $877 , $2,640 and $2,912 , respectively, of acquisition related costs were charged to operations. For each acquisition, the Company undertakes a detailed review to identify other intangible assets and a valuation is performed for all such identified assets. The Company uses several market participant measurements to determine estimated value. This approach includes consideration of similar and recent transactions, as well as utilizing discounted expected cash flow methodologies. A substantial portion of the intangible asset value that the Company acquires is the specialized know-how of the workforce, which is treated as part of goodwill and is not required to be valued separately. The majority of the value of the identifiable intangible assets acquired is derived from customer relationships, including the related customer contracts, as well as trade names. In executing the Company’s overall acquisition strategy, one of the primary drivers in identifying and executing a specific transaction is the existence of, or the ability to, expand the existing client relationships. The expected benefits of the Company’s acquisitions are typically shared across multiple agencies and regions. Redeemable Noncontrolling Interests . Many of the Company’s acquisitions include contractual arrangements where the noncontrolling shareholders have an option to purchase, or may require the Company to purchase, such noncontrolling shareholders’ incremental ownership interests under certain circumstances and the Company has similar call options under the same contractual terms. The amount of consideration under these contractual arrangements is not a fixed amount, but rather is dependent upon various valuation formulas as described in Note 17 of the Notes to the Consolidated Financial Statements included herein. In the event that an incremental purchase may be required of the Company, the amounts are recorded as redeemable noncontrolling interests in mezzanine equity on the balance sheet at their acquisition date fair value and adjusted for changes to their estimated redemption value through additional paid-in capital (but not less than their initial redemption value), except for foreign currency translation adjustments. These adjustments will not impact the calculation of earnings (loss) per share if the redemption values are less than the estimated fair values. For the three years ended December 31, 2017 , 2016 , and 2015 , there was no impact on the Company’s earnings (loss) per share calculation. The following table presents changes in redeemable noncontrolling interests: Years Ended December 31, 2017 2016 2015 Beginning Balance as of January 1, $ 60,180 $ 69,471 $ 194,951 Redemptions (910 ) (1,708 ) (155,042 ) Granted 1,666 2,274 7,703 Changes in redemption value 1,498 (9,604 ) 22,809 Currency translation adjustments 452 (253 ) (950 ) Ending Balance as of December 31, $ 62,886 $ 60,180 $ 69,471 Subsidiary and Equity Investment Stock Transactions. Transactions involving the purchase, sale or issuance of stock of a subsidiary where control is maintained are recorded as a reduction in the redeemable noncontrolling interests or noncontrolling interests, as applicable. Any difference between the purchase price and noncontrolling interest is recorded to additional paid-in capital. In circumstances where the purchase of shares of an equity investment results in obtaining control, the existing carrying value of the investment is remeasured to the acquisition date fair value and any gain or loss is recognized in results of operations. Variable Interest Entity . Effective March 28, 2012, the Company invested in Doner Partners LLC (“Doner”). The Company acquired a 30% voting interest and convertible preferred interests that allow the Company to increase ordinary voting ownership to 70% at the Company’s option. Effective April 1, 2017, the Company acquired an additional 15% voting and convertible preferred interest that allowed the Company to increase ordinary voting ownership to 85% at the Company’s option. The Company now has a 65% voting interest. The Company has determined that (i) this entity is a variable interest entity and (ii) the Company is the primary beneficiary because it receives a disproportionate share of profits and losses as compared to its ownership percentage. As such, Doner is consolidated for all periods subsequent to the date of investment. Doner is a full service integrated creative agency that is included as part of the Company’s portfolio in the Global Integrated Agencies segment. The Company’s Credit Agreement (see Note 10) is guaranteed and secured by all of Doner’s assets. Total assets and total liabilities of Doner included in the Company’s consolidated balance sheet at December 31, 2017 and 2016 , were $105,191 and $59,783 , and $102,456 and $57,622 , respectively. Guarantees . Guarantees issued or modified by the Company to third parties after January 1, 2003 are generally recognized, at the inception or modification of the guarantee, as a liability for the obligations it has undertaken in issuing the guarantee, including its ongoing obligation to stand ready to perform over the term of the guarantee in the event that the specified triggering events or conditions occur. The initial measurement of that liability is the fair value of the guarantee. The recognition of the liability is required even if it is not probable that payments will be required under the guarantee. The Company’s liability associated with guarantees is not significant. See Note 17 of the Notes to the Consolidated Financial Statements included herein for further information. Revenue Recognition . The Company’s revenue recognition policies are established in accordance with the Revenue Recognition topics of the FASB ASC, and accordingly, revenue is recognized when all of the following criteria are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the selling price is fixed or determinable; (iii) services have been performed or upon delivery of the products when ownership and risk of loss has transferred to the client; and (iv) collection of the resulting receivable is reasonably assured. The Company follows the Multiple-Element Arrangement topic of the FASB ASC, which addresses certain aspects of the accounting by a vendor for arrangements under which it will perform multiple revenue-generating activities and how to determine whether an arrangement involving multiple deliverables contains more than one unit of accounting. The Company follows the Principal Agent Consideration topic of the FASB ASC which addresses (i) whether revenue should be recorded at the gross amount billed because it has earned revenue from the sale of goods or services, or recorded at the net amount retained because it has earned a fee or commission, and (ii) that reimbursements received for out-of-pocket expenses incurred should be characterized in the income statement as revenue. Accordingly, the Company has included such reimbursed expenses in revenue. The Company earns revenue from agency arrangements in the form of retainer fees or commissions; from short-term project arrangements in the form of fixed fees or per diem fees for services; and from incentives or bonuses. Non-refundable retainer fees are generally recognized on a straight-line basis over the term of the specific customer arrangement. Commission revenue is earned and recognized upon the placement of advertisements in various media when the Company has no further performance obligations. Fixed fees for services are recognized upon completion of the earnings process and acceptance by the client. Per diem fees are recognized upon the performance of the Company’s services. In addition, for a limited number of certain service transactions, which require delivery of a number of service acts, the Company uses the proportional performance model, which generally results in revenue being recognized based on the straight-line method. For arrangements with customers for which the Company earns a fixed fee for development of customized mobile applications (“Apps”), revenue is recognized in accordance with the accounting guidance contained in ASC 605-35 and is primarily recognized using the proportional performance method of accounting. Performance is generally measured based upon the efforts incurred to date in relation to total estimated efforts to the completion of the contract. Fees billed to clients in excess of fees recognized as revenue are classified as advanced billings on the Company’s balance sheet. A small portion of the Company’s contractual arrangements with customers includes performance incentive provisions, which allow the Company to earn additional revenue as a result of its performance relative to both quantitative and qualitative goals. The Company recognizes the incentive portion of revenue under these arrangements when specific quantitative goals are assured, or when the Company’s clients determine performance against qualitative goals has been achieved. In all circumstances, revenue is only recognized when collection is reasonably assured. The Company records revenue net of sales and other taxes due to be collected and remitted to governmental authorities. Cost of Services Sold . Cost of services sold primarily consists of staff costs, and does not include depreciation charges for fixed assets. Interest Expense . Interest expense primarily consists of the cost of borrowing on the Company’s previously outstanding 6.75% Senior Notes due 2020 (the “6.75% Notes”); the Company’s currently outstanding 6.50% senior unsecured notes due 2024 (the “6.50% Notes”); and the Company’s $325,000 senior secured revolving credit agreement due 2021 (the “Credit Agreement”). The Company uses the effective interest method to amortize the deferred financing costs on the 6.75% Notes, the 6.50% Notes as well as the original issue premium on the previously outstanding 6.75% Notes. The Company also uses the straight-line method to amortize the deferred financing costs on the Credit Agreement. For the years ended December 31, 2017 , 2016 , and 2015 , interest expense included $100 , $255 , and $2,543 , respectively, relating to present value adjustments for fixed deferred acquisition consideration payments. Deferred Taxes . The Company uses the asset and liability method of accounting for income taxes. Deferred income taxes are provided for the temporary difference between the financial reporting basis and tax basis of the Company’s assets and liabilities. Deferred tax benefits result primarily from certain tax carryover benefits, from recording certain expenses in the financial statements that are not currently deductible for tax purposes and from differences between the tax and book basis of assets and liabilities recorded in connection with acquisitions. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax liabilities result primarily from deductions recorded for tax purposes in excess of that recorded in the financial statements or income for financial statement purposes in excess of the amount for tax purposes. The effect of changes in tax rates is recognized in the period the rate change is enacted. Stock-Based Compensation . Under the fair value method, compensation cost is measured at fair value at the date of grant and is expensed over the service period, in this case the award’s vesting period. The Company recognizes forfeitures as they occur. When awards are exercised, share capital is credited by the sum of the consideration paid together with the related portion previously credited to additional paid-in capital when compensation costs were charged against income or acquisition consideration. The Company uses its historical volatility derived over the expected term of the award to determine the volatility factor used in determining the fair value of the award. Stock-based awards that are settled in cash, or may be settled in cash at the option of employees, are recorded as liabilities. The measurement of the liability and compensation co |
Loss per Common Share
Loss per Common Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Loss per Common Share | . Income (Loss) per Common Share The following table sets forth the computation of basic and diluted income (loss) per common share from continuing operations for the years ended December 31: 2017 2016 2015 Numerator: Income (loss) from continuing operations $ 257,223 $ (40,621 ) $ (20,119 ) Net income attributable to the noncontrolling interests (15,375 ) (5,218 ) (9,054 ) Net income (loss) from continuing operations attributable to MDC Partners Inc. $ 241,848 $ (45,839 ) $ (29,173 ) Accretion on convertible preference shares (6,352 ) — — Net income allocated to convertible preference shares (29,902 ) — — Net income (loss) from continuing operations attributable to MDC Partners Inc. common shareholders 205,594 (45,839 ) (29,173 ) Effect of dilutive securities: Adjustment to net income allocated to convertible preference shares 106 — — Net income (loss) from continuing operations attributable to MDC Partners Inc. common shareholders $ 205,700 $ (45,839 ) $ (29,173 ) Denominator: Basic weighted average number of common shares outstanding 55,255,797 51,345,807 49,875,282 Effect of dilutive securities: Impact of stock options and non-vested stock under employee stock incentive plans 225,989 — — Diluted weighted average number of common shares outstanding 55,481,786 51,345,807 49,875,282 Net income (loss) from continuing operations attributable to MDC Partners Inc common shareholders per common share: Basic $ 3.72 $ (0.89 ) $ (0.58 ) Diluted $ 3.71 $ (0.89 ) $ (0.58 ) At December 31, 2017 , 2016 and 2015 , options and other rights to purchase 886,596 , 1,391,456 and 947,465 shares of common stock, respectively, were not included in the computation of diluted loss per common share because doing so would have had an anti-dilutive effect. Additionally, 1,433,921 shares of non-vested restricted stock and restricted stock unit awards, which are contingent upon the Company meeting an undefined cumulative three year earnings target and continued employment, are excluded from the computation of diluted income per common share as the contingency has not been satisfied at December 31, 2017. Lastly, there were 95,000 shares of Preference Shares outstanding which were convertible into 10,135,244 Class A common shares at December 31, 2017 . These Preference Shares were anti-dilutive for year ended December 31, 2017 and are therefore excluded from the diluted income per common share calculation for the period. |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Acquisitions | 4. Acquisitions and Dispositions Valuations of acquired companies are based on a number of factors, including specialized know-how, reputation, competitive position and service offerings. The Company’s acquisition strategy has been focused on acquiring the expertise of an assembled workforce in order to continue to build upon the core capabilities of its various strategic business platforms to better serve the Company’s clients. The Company’s strategy includes acquiring ownership stakes in well-managed businesses with strong reputations in the industry. The Company’s model of “Perpetual Partnership” often involves acquiring a majority interest rather than a 100% interest and leaving management owners with a significant financial interest in the performance of the acquired entity for a minimum period of time, typically not less than five years. The Company’s acquisition model in this scenario typically provides for (i) an initial payment at the time of closing, (ii) additional contingent purchase price obligations based on the future performance of the acquired entity, and (iii) an option by the Company to purchase (and in some instances a requirement to so purchase) the remaining interest of the acquired entity under a predetermined formula. Contingent purchase price obligations. The Company’s contingent purchase price obligations are generally payable within a five year period following the acquisition date, and are based on (i) the achievement of specific thresholds of future earnings, and (ii) in certain cases, the growth rate of those earnings. Contingent purchase price obligations are recorded as deferred acquisition consideration on the balance sheet at the acquisition date fair value and adjusted at each reporting period through operating income or net interest expense, depending on the nature of the arrangement. On occasion, the Company may initiate a renegotiation of previously acquired ownership interests and any resulting change in the estimated amount of consideration to be paid is adjusted in the reporting period through operating income or net interest expense, depending on the nature of the arrangement. See Note 13 of the Notes to the Consolidated Financial Statements included herein for additional information on deferred acquisition consideration. Options to purchase . When acquiring less than 100% ownership, the Company may enter into agreements that give the Company an option to purchase, or require the Company to purchase, the incremental ownership interests under certain circumstances. Where the option to purchase the incremental ownership is within the Company’s control, the amounts are recorded as noncontrolling interests in the equity section of the Company’s balance sheet. Where the incremental purchase may be required of the Company, the amounts are recorded as redeemable noncontrolling interests in mezzanine equity at their estimated acquisition date redemption value and adjusted at each reporting period for changes to their estimated redemption value through additional paid-in capital (but not less than their initial redemption value), except for foreign currency translation adjustments. On occasion, the Company may initiate a renegotiation to acquire an incremental ownership interest and the amount of consideration paid may differ materially from the balance sheet amounts. See Note 17 of the Notes to the Consolidated Financial Statements included herein for additional information on redeemable noncontrolling interests. Employment conditions. From time to time, specifically when the projected success of an acquisition is deemed to be dependent on retention of specific personnel, such acquisition may include deferred payments that are contingent upon employment terms as well as financial performance. The Company accounts for those payments through operating income as stock-based compensation over the required retention period. For the years ended December 31, 2017, 2016 and 2015, stock-based compensation included $13,079 , $10,341 , and $9,359 , respectively, of expense relating to those payments. Distributions to noncontrolling shareholders. If noncontrolling shareholders have the right to receive distributions based on the profitability of an acquired entity, the amount is recorded as income attributable to noncontrolling interests. However, there are circumstances when the Company acquires a majority interest and the selling shareholders waive their right to receive distributions with respect to their retained interest for a period of time, typically not less than five years. Under this model, the right to receive such distributions typically begins concurrently with the purchase option period and, therefore, if such option is exercised at the first available date the Company may not record any noncontrolling interest over the entire period from the initial acquisition date through the acquisition date of the remaining interests. 2017 Acquisitions In 2017, the Company entered into various non-material transactions in connection with certain of its majority-owned entities. As a result of the foregoing, the Company made total cash closing payments of $3,858 , increased fixed deferred consideration liability by $7,208 , reduced redeemable noncontrolling interests by $816 , reduced noncontrolling interests equity by $11,965 , reduced noncontrolling interest payable by $397 , and increased additional paid-in capital by $2,315 . In addition, a stock-based compensation charge of $996 has been recognized representing the consideration paid in excess of the fair value of the interest acquired. 2017 Dispositions During 2017, the Company sold all of its ownership interests in three subsidiaries resulting in recognition of a net loss on sale of business of $1,732 . The net assets reflected in the calculation of the net loss on sale was inclusive of goodwill of $17,593 . Goodwill was allocated to the subsidiaries based on the relative fair value of the sold subsidiaries compared to the fair value of the respective reporting units. See Note 1 of the Notes to the Consolidated Financial Statements included herein for further information. Additionally, the Company recorded a reduction in noncontrolling interests of $10,657 . In addition, the Company sold a non-controlling ownership interest in two subsidiaries during 2017. The Company recorded $6,961 of non-controlling interest equity and $1,690 of redeemable non-controlling interest, representing the fair value of the disposed ownership interest at the time of execution. Additionally, stock-based compensation of $2,473 was recognized, representing the excess in the proportionate fair value over the total consideration received. 2016 Acquisitions Effective July 1, 2016, the Company acquired 100% of the equity interests of Forsman & Bodenfors AB (“F&B”), an advertising agency based in Sweden, for an estimated aggregate purchase price at acquisition date of $49,837 , consisting of a closing payment of 1,900,000 MDC Class A subordinate voting shares with an acquisition date fair value of $34,219 , plus additional deferred acquisition payments with an estimated present value at acquisition date of $15,618 . The amount of additional payments are based on the financial results of the acquired business for 2015 and 2016 as well as for the value of the Company’s shares from July 1, 2016 up to and including the close of business on November 2, 2016. During the three months ended June 30, 2017, the Company paid cash of $3,055 and issued an additional 2,450,000 MDC Class A subordinate voting shares with a fair value of $20,800 as a settlement of deferred acquisition consideration. An allocation of excess purchase price consideration of this acquisition to the fair value of the net assets acquired resulted in identifiable intangibles of $36,698 , consisting primarily of customer lists, trade names and covenants not to compete, and goodwill of $24,778 , including the value of the assembled workforce. The identified assets have a weighted average useful life of approximately 10.8 years and will be amortized in a manner represented by the pattern in which the economic benefits of such assets are expected to be realized. In addition, the Company has recorded $2,275 as the present value of redeemable noncontrolling interests and $5,514 as the present value of noncontrolling interests both relating to the noncontrolling interest of F&B’s subsidiaries. None of the intangibles and goodwill are tax deductible and the Company recorded a deferred tax liability of $8,074 related to the intangibles. F&B’s results are included in the Global Integrated Agencies segment. During the six months ended June 30, 2017, F&B earned revenue of $43,535 and incurred a net loss of $4,460 , which is included in our consolidated results for the year ended December 31, 2017. The net loss was attributable to an increase in the deferred acquisition payment liability related to such acquisition, driven by the decrease in the future market performance of the Company’s stock price and the amortization of the intangibles identified in the allocation of the purchase price consideration. Effective April 1, 2016, the Company acquired the remaining 40% ownership interests of Luntz Global Partners LLC. In 2016, the Company also entered into various non-material transactions in connection with other majority-owned entities. As a result of the foregoing, the Company made total cash closing payments of $1,581 , eliminated the contingent deferred acquisition payments of $4,052 and fixed deferred acquisition payments of $467 related to certain initial acquisition of the equity interests, reduced other assets by $428 , reduced redeemable noncontrolling interests by $1,005 , reduced noncontrolling interests by $19,354 , increased accruals and other liabilities by $94 , and increased additional paid-in capital by $22,775 . Additional deferred payments with an estimated present value at acquisition date of $2,393 that are contingent upon service conditions have been excluded from deferred acquisition consideration and will be expensed as stock-based compensation over the required service period. 2015 Acquisitions Effective May 1, 2015, the Company acquired a majority of the equity interests of Y Media Labs LLC, such that following the transaction, the Company’s effective ownership was 60% . Effective October 31, 2015, the Company acquired substantially 100% of the assets of Unique Influence, LLC (and certain other affiliated entities). The aggregate purchase price of these acquisitions had an estimated present value at acquisition date of $55,279 and consisted of total closing cash payments of $23,000 and additional deferred acquisition payments that will be based on the future financial results of the underlying businesses from 2015 to 2020 with final payments due in 2022 . These additional deferred payments have an estimated present value at acquisition date of $32,279 . An allocation of excess purchase price consideration of these acquisitions to the fair value of the net assets acquired resulted in identifiable intangibles of $16,721 , consisting primarily of customer lists, trade names and covenants not to compete, and goodwill of $43,654 , including the value of the assembled workforce. The identified assets have a weighted average useful life of approximately 6.3 years and will be amortized in a manner represented by the pattern in which the economic benefits of such assets are expected to be realized. In addition, the Company has recorded $1,999 as the present value of redeemable noncontrolling interests. The Company expects intangibles and goodwill of $9,720 to be tax deductible. In 2015, the Company acquired incremental ownership interests of Sloane & Company LLC, Anomaly Partners LLC, Allison & Partners LLC, Relevent Partners LLC, Kenna Communications LP and 72andSunny Partners LLC. In addition, the Company also entered into various non-material transactions in connection with other majority owned entities. The aggregate purchase price for these 2015 acquisitions of incremental ownership interests had an estimated present value at transaction date of $200,822 and consisted of total closing cash payments of $37,467 and additional deferred acquisition payments that are both fixed and based on the future financial results of the underlying businesses from 2015 to 2021 with final payments due in 2022. These additional deferred payments had an estimated present value at acquisition date of $163,355 . The Company reduced redeemable noncontrolling interests by $149,335 and noncontrolling interests by $8,708 . The difference between the purchase price and the noncontrolling interests of $42,780 was recorded in additional paid-in capital. 2015 Dispositions Effective May 31, 2015, the Company completed the sale of Accent for an aggregate selling price of $17,102 , net of transaction expenses. Included in discontinued operations in the Company’s consolidated statements of operations for the year ended December 31, 2015: 2015 Revenue $ 27,025 Operating loss (322 ) Other expense (752 ) Loss on disposal (5,207 ) Loss from discontinued operations attributable to MDC Partners Inc., net of taxes $ (6,281 ) Noncontrolling Interests Changes in the Company’s ownership interests in our less than 100% owned subsidiaries during the three years ended December 31, were as follows: Net Income (Loss) Attributable to MDC Partners Inc. and Transfers (to) from the Noncontrolling Interests Year Ended December 31, 2017 2016 2015 Net income (loss) attributable to MDC Partners Inc. $ 241,848 $ (45,839 ) $ (35,454 ) Transfers (to) from the noncontrolling interests Increase (decrease) in MDC Partners Inc. paid-in capital for purchase of equity interests in excess of noncontrolling interests and redeemable noncontrolling interests 2,315 22,776 (42,780 ) Net transfers (to) from noncontrolling interests $ 2,315 $ 22,776 $ (42,780 ) Change from net income (loss) attributable to MDC Partners Inc. and transfers (to) from noncontrolling interests $ 244,163 $ (23,063 ) $ (78,234 ) |
Fixed Assets
Fixed Assets | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | 5. Fixed Assets The following is a summary of the Company’s fixed assets as of December 31: 2017 2016 Cost Accumulated Depreciation Net Book Value Cost Accumulated Depreciation Net Book Value Computers, furniture and fixtures $ 101,806 $ (74,429 ) $ 27,377 $ 91,909 $ (64,030 ) $ 27,879 Leasehold improvements 112,099 (49,170 ) 62,929 91,601 (41,103 ) 50,498 $ 213,905 $ (123,599 ) $ 90,306 $ 183,510 $ (105,133 ) $ 78,377 At December 31, 2017 and 2016 , included in fixed assets are assets under capital lease obligations with a cost of $1,903 and $1,967 , respectively, and accumulated depreciation of $1,176 and $1,316 , respectively. Depreciation expense for the years ended December 31, 2017 , 2016 , and 2015 was $23,873 , $22,293 and $18,871 , respectively. |
Accrued and Other Liabilities
Accrued and Other Liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
Accrued and Other Liabilities | 6. Accruals and Other Liabilities At December 31, 2017 and 2016 , accruals and other liabilities included accrued media of $207,482 and $201,872 , respectively; and included amounts due to noncontrolling interest holders for their share of profits, which will be distributed within the next twelve months, of $11,030 and $4,154 , respectively. Changes in noncontrolling interest amounts included in accrued and other liabilities for the three years ended December 31, were as follows: Noncontrolling Interests Balance at December 31, 2014 $ 6,014 Income attributable to noncontrolling interests 9,054 Distributions made (9,503 ) Other (1) (92 ) Balance at December 31, 2015 $ 5,473 Income attributable to noncontrolling interests 5,218 Distributions made (7,772 ) Other (1) 1,235 Balance at December 31, 2016 $ 4,154 Income attributable to noncontrolling interests 15,375 Distributions made (8,865 ) Other (1) 366 Balance at December 31, 2017 $ 11,030 (1) Other consists primarily of business acquisitions, sale of a business, step-up transactions, and cumulative translation adjustments. At December 31, 2017 and December 31, 2016, accounts payable included $41,989 and $80,193 of outstanding checks, respectively. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | 7. Financial Instruments Financial assets, which include cash and cash equivalents and accounts receivable, have carrying values which approximate fair value due to the short-term nature of these assets. Financial liabilities with carrying values approximating fair value due to short-term maturities include accounts payable. Deferred acquisition consideration is recorded at fair value. The revolving credit agreement is a variable rate debt, the carrying value of which approximates fair value. The Company’s notes are a fixed rate debt instrument recorded at the carrying value. See Note 13 of the Notes to the Consolidated Financial Statements included herein for the fair value. The fair value of financial commitments, guarantees and letters of credit, are based on the stated value of the underlying instruments. Guarantees have been issued in conjunction with the disposition of businesses in 2001 and 2003 and letters of credit have been issued in the normal course of business. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | . Goodwill and Intangible Assets As of December 31, goodwill was as follows: Goodwill Global Integrated Agencies Domestic Creative Agencies Specialist Communications Media Services All Other Total Balance at December 31, 2015 $ 364,159 $ 36,671 $ 97,578 $ 142,286 $ 229,607 $ 870,301 Acquired goodwill 24,778 — — — — 24,778 Disposition — — — — (764 ) (764 ) Impairment loss recognized — — (18,893 ) — (29,631 ) (48,524 ) Transfer of goodwill between segments (1) (34,400 ) — — 34,400 — — Foreign currency translation (3,821 ) 91 6 — 2,692 (1,032 ) Balance at December 31, 2016 $ 350,716 $ 36,762 $ 78,691 $ 176,686 $ 201,904 $ 844,759 Acquired goodwill — — — — — — Disposition (964 ) — — (16,629 ) — (17,593 ) Impairment loss recognized — — — — (3,238 ) (3,238 ) Transfer of goodwill between segments (1) 3,630 — — — (3,630 ) — Foreign currency translation 5,689 218 15 — 6,085 12,007 Balance at December 31, 2017 $ 359,071 $ 36,980 $ 78,706 $ 160,057 $ 201,121 $ 835,935 (1) During the year ended December 31, 2017 and 2016, the Company transferred a component of one reporting unit to another reporting unit. An interim impairment analysis was performed both before and after the transfer, noting no impairment indicators were present. As a result of the annual impairment test performed as of October 1, 2017, the Company recognized a partial impairment of goodwill of $3,238 relating to two of the Company’s reporting units. See Note 2 of the Notes to the Consolidated Financial Statements herein for further information. Additionally, during 2017, the Company wrote off goodwill of $17,593 related to the sale of certain subsidiaries. This write off is included in other income (expense). During the third quarter of 2016, there was a change to the Company’s reporting units. This change, coupled with a decline in operating performance required the Company to perform interim goodwill testing on one of its experiential reporting units. Additionally, a triggering event occurred during the third quarter of 2016 that required the Company to perform interim goodwill testing on one non-material reporting unit. This interim impairment analysis resulted in a partial impairment of goodwill of $27,893 and $1,738 relating to the experiential reporting unit and non-material reporting unit, respectively. For the 2016 annual impairment test, a partial impairment of goodwill of $18,893 in one of the Company’s strategic communications reporting units. The fair value for all other reporting units were in excess of their respective carrying amounts and as a result there was no additional impairment of goodwill. Additionally, in the third quarter of 2016, the Company sold its ownership interests in a subsidiary to the noncontrolling shareholders, resulting in a write off of goodwill of $764 . The total accumulated goodwill impairment charges are $98,645 through December 31, 2017 . As of December 31, the gross and net amounts of acquired intangible assets other than goodwill were as follows: For the Year Ended December 31, Intangible Assets 2017 2016 Trademarks (indefinite life) $ 17,780 $ 17,780 Customer relationships – gross $ 102,325 $ 121,408 Less accumulated amortization (73,767 ) (80,432 ) Customer relationships – net $ 28,558 $ 40,976 Other intangibles – gross $ 37,273 $ 43,656 Less accumulated amortization (13,006 ) (17,341 ) Other intangibles – net $ 24,267 $ 26,315 Total intangible assets $ 157,378 $ 182,844 Less accumulated amortization (86,773 ) (97,773 ) Total intangible assets – net $ 70,605 $ 85,071 The weighted average amortization periods for customer relationships are six years and other intangible assets are nine years . In total, the weighted average amortization period is seven years . Amortization expense related to amortizable intangible assets for the years ended December 31, 2017 , 2016 , and 2015 was $17,125 , $21,726 , and $30,024 , respectively. The estimated amortization expense for the five succeeding years is as follows: Year Amortization 2018 $ 13,051 2019 8,832 2020 6,619 2021 5,038 2022 4,520 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 9. Income Taxes On December 22, 2017, the U.S. government enacted comprehensive legislation commonly referred to as the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code including but not limited to a reduction in U.S. federal corporate tax rate from 35% to 21%, effective for tax years beginning after December 31, 2017 and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings. The SEC staff issued Staff Accounting Bulletin No. 118 (“SAB 118”) which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. To the extent that a company’s accounting for certain income tax effects of those aspects of the Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate to be included in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act. As a result of the initial analysis of the impact of the Tax Act, the Company recorded a net expense of $26,674 related to the re-measurement of deferred tax assets and liabilities resulting in a change in the corporate tax rate from 35% to 21% . This amount was offset in part by the release of a valuation allowance of $60,772 related to the re-measurement required by the rate change. It was also offset by $66,373 due to changes under the Tax Act, which resulted in significant additional positive evidence, in the form of future taxable income, that impacted management's assessment of the amount of the Company's deferred tax assets that would be realized going forward. Additionally, the Company recorded no tax expense as a result of the transition tax. The combined effect of the changes from the Tax Act resulted in a tax benefit of $100,472 . While the Company has made a reasonable estimate of the impact of the reduction in the corporate rate and transition tax, it continues to gather additional information and awaits further interpretive guidance from the tax authorities to more precisely calculate amounts. The Act created a new requirement that Global Intangible Low-Taxed Income (i.e., GILTI) earned by controlled foreign corporations (CFCs) must be included currently in the gross income of the CFCs’ U.S. shareholder. GILTI is the excess of the shareholder’s “net CFC tested income” over the net deemed tangible income return (the “routine return”), which is defined as the excess of (1) 10% of the aggregate of the U.S. shareholder’s pro rata share of the qualified business asset investment (QBAI) of each CFC with respect to which it is a U.S. shareholder over (2) the amount of certain interest expense taken into account in the determination of net CFC-tested income. A deduction is permitted to a domestic corporation in an amount up to 50% of the sum of the GILTI inclusion and the amount treated as a dividend because the corporation has claimed a foreign tax credit (FTC) as a result of the inclusion of the GILTI amount in income. The Company continues to assess the impact of GILTI provisions on its financial statements and whether it will be subject to U.S. GILTI inclusion in future years. As such, the Company has not made a policy election on whether to record tax effects of GILTI when paid as a period expense or to record deferred tax assets and liabilities on basis differences that are expected to affect the amount of GILTI inclusion. The components of the Company’s income (loss) from continuing operations before income taxes and equity in earnings of non-consolidated affiliates by taxing jurisdiction for the years ended December 31, were: 2017 2016 2015 Income (Loss): U.S. $ 48,053 $ (16,661 ) $ 23,180 Non-U.S. 39,025 (33,055 ) (40,596 ) $ 87,078 $ (49,716 ) $ (17,416 ) The provision (benefit) for income taxes by taxing jurisdiction for the years ended December 31, were: 2017 2016 2015 Current tax provision U.S. federal $ (1,657 ) $ — $ — U.S. state and local 98 (1,520 ) 1,375 Non-U.S. 6,514 2,154 2,465 4,955 634 3,840 Deferred tax provision (benefit): U.S. federal (172,873 ) 5,785 5,359 U.S. state and local (7,775 ) (3,550 ) 2,877 Non-U.S. 7,629 (12,273 ) (8,315 ) (173,019 ) (10,038 ) (79 ) Income tax provision (benefit) $ (168,064 ) $ (9,404 ) $ 3,761 A reconciliation of income tax expense (benefit) using the statutory Canadian federal and provincial income tax rate compared with actual income tax expense for the years ended December 31, is as follows: 2017 2016 2015 Income (loss) from continuing operations before income taxes, equity in non-consolidated affiliates and noncontrolling interest $ 87,078 $ (49,716 ) $ (17,416 ) Statutory income tax rate 26.5 % 26.5 % 26.5 % Tax expense (benefit) using statutory income tax rate 23,076 (13,175 ) (4,615 ) State and foreign taxes 8,863 (94 ) 3,524 Non-deductible stock-based compensation 1,441 1,123 665 Other non-deductible expense (220 ) 1,848 163 Change to valuation allowance (103,212 ) 6,605 3,565 Effect of the difference in Canadian and local statutory rates 4,463 (4,579 ) 1,906 Impact of tax reform (100,472 ) — — Noncontrolling interests (4,413 ) (1,287 ) (2,399 ) Impact of foreign operations (2,453 ) — — Other, net 4,863 155 952 Income tax expense (benefit) $ (168,064 ) $ (9,404 ) $ 3,761 Effective income tax rate (193.0 )% 18.9 % (21.6 )% Income taxes receivable were $4,582 and $1,506 at December 31, 2017 and 2016 , respectively, and were included in other current assets on the balance sheet. Income taxes payable were $3,810 and $4,547 at December 31, 2017 and 2016 , respectively, and were included in accrued and other liabilities on the balance sheet. It is the Company’s policy to classify interest and penalties arising in connection with the under payment of income taxes as a component of income tax expense. The tax effects of significant temporary differences representing deferred tax assets and liabilities at December 31, were as follows: 2017 2016 Deferred tax assets: Capital assets and other $ 5,059 $ 6,758 Net operating loss carry forwards 49,318 44,305 Interest deductions 2,026 12,146 Refinancing charge 5,578 7,413 Goodwill and intangibles 129,455 179,029 Stock compensation 1,208 2,581 Pension plan 4,165 5,095 Unrealized foreign exchange 8,653 15,237 Capital loss carry forwards 11,450 10,957 Accounting reserves 412 7,138 Gross deferred tax asset 217,324 290,659 Less: valuation allowance (19,032 ) (248,866 ) Net deferred tax assets 198,292 41,793 Deferred tax liabilities: Deferred finance charges — (333 ) Capital assets and other — (388 ) Goodwill amortization (89,727 ) (109,638 ) Total deferred tax liabilities (89,727 ) (110,359 ) Net deferred tax asset (liability) $ 108,565 $ (68,566 ) Disclosed as: Deferred tax assets $ 115,325 $ 41,793 Deferred tax liabilities (6,760 ) (110,359 ) $ 108,565 $ (68,566 ) The Company has U.S. federal net operating loss carry forwards of $29,723 and non-U.S. net operating loss carry forwards of $116,536 . These carry forwards expire in years 2017 through 2032 . The Company also has total indefinite loss carry forwards of $96,063 . These indefinite loss carry forwards consist of $9,646 relating to the U.S. and $86,417 which are related to capital losses from the Canadian operations. In addition, the Company has net operating loss carry forwards for various state taxing jurisdictions of approximately $119,188 . The Company records a valuation allowance against deferred income tax assets when management believes it is more likely than not that some portion or all of the deferred income tax assets will not be realized. Management evaluates all positive and negative evidence and considers factors such as the reversal of taxable temporary differences, future taxable income, and tax planning strategies. A change to these factors could impact the estimated valuation allowance and income tax expense. As of December 31, 2016, the Company maintained valuation allowance against its world-wide net deferred tax asset of $248,866 as it believed it was more likely than not that some or all of the deferred tax assets would not be realized. This assessment was based on the Company’s historical losses and uncertainties as to the amount of future taxable income. As of December 31, 2017, the Company evaluated positive and negative evidence in determining the likelihood that it will be able to realize all or some portion of its deferred tax assets prior to their expiration. As of September 30, 2017, the Company’s three-year cumulative pre-tax income had declined compared to the period ended December 31, 2016. As of December 31, 2017 the three-year cumulative pre-tax income had increased substantially, consistent with the Company’s history of strong fourth quarter performance, which provided significant positive evidence. Upon completion of this evaluation, the Company concluded that in part, as a result of cumulative pretax income, there is sufficient positive evidence that the Company will more likely than not realize its U.S. deferred tax assets. Therefore, the Company reduced its valuation allowance by $105,486 . In addition, because of the Tax Act, the Company remeasured its existing deferred tax assets and reduced its valuation allowance by $127,146 , as described above. The related effect on the accompanying consolidated statements of operations and comprehensive income or loss resulted in the Company recording a U.S. income tax benefit of $232,632 for the year ended December 31, 2017. Deferred taxes are not provided for temporary differences representing earnings change of subsidiaries that are intended to be permanently reinvested. The potential deferred tax liability associated with these undistributed earnings is not material. As of December 31, 2017 and 2016 , the Company recorded a liability for unrecognized tax benefits as well as applicable penalties and interest in the amount of $1,556 and $1,543 , respectively. As of December 31, 2017 and 2016 , accrued penalties and interest included in unrecognized tax benefits were approximately $123 and $78 , respectively. The Company identified an uncertainty relating to the future tax deductibility of certain intercompany fees. To the extent that such future benefit will be established, the resolution of this position will have no effect with respect to the financial statements. If these unrecognized tax benefits were to be recognized, it would affect the Company’s effective tax rate. Changes in the Company’s reserve is as follows: Balance at December 31, 2014 $ 3,073 Charges to income tax expense 960 Settlement of uncertainty (428 ) Balance at December 31, 2015 3,605 Charges to income tax expense (1,261 ) Settlement of uncertainty (879 ) Balance at December 31, 2016 1,465 Charges to income tax expense (32 ) Balance at December 31, 2017 $ 1,433 The Company does not expect its unrecognized tax benefits to change significantly over the next 12 months . The Company has completed U.S. federal tax audits through 2013 and has completed a non-U.S. tax audit through 2009. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | 10. Debt As of December 31, the Company’s indebtedness was comprised as follows: 2017 2016 Revolving credit agreement $ — $ 54,425 6.50% Notes due 2024 900,000 900,000 Debt issuance costs (17,587 ) (18,420 ) 882,413 936,005 Obligations under capital leases 706 431 883,119 936,436 Less: Current portion of long-term debt 313 228 $ 882,806 $ 936,208 Interest expense related to long-term debt for the years ended December 31, 2017 , 2016 , and 2015 was $62,001 , $56,468 and $53,090 , respectively. For the year ended December 31, 2016, the Company recorded a charge for the loss on redemption of the 6.75% Notes of $33,298 , which included accrued interest, related premiums, fees and expenses, write offs of unamortized original issue premium, and unamortized debt issuance costs. For the years ended December 31 2016 , and 2015 , interest expense included income of $312 , $1,178 , related to the amortization of the original issue premium. For the years ended December 31, 2017 , 2016 , and 2015 , interest expense included $100 , $255 and $2,543 , respectively, of present value adjustments for fixed deferred acquisition payments. The amortization of deferred finance costs included in interest expense were $3,022 , $3,022 and $3,448 for the years ended December 31, 2017 , 2016 , and 2015 , respectively. 6.50% Notes On March 23, 2016, MDC entered into an indenture (the “Indenture”) among MDC, its existing and future restricted subsidiaries that guarantee, are co-borrowers under or grant liens to secure, the Credit Agreement, as guarantors (the “Guarantors”) and The Bank of New York Mellon, as trustee, relating to the issuance by MDC of $900,000 aggregate principal amount of the 6.50% Notes. The 6.50% Notes were sold in a private placement in reliance on exceptions from registration under the Securities Act of 1933. The 6.50% Notes bear interest at a rate of 6.50% per annum, accruing from March 23, 2016. Interest is payable semiannually in arrears on May 1 and November 1 of each year, beginning November 1, 2016. The 6.50% Notes mature on May 1, 2024, unless earlier redeemed or repurchased. The Company received net proceeds from the offering of the 6.50% Notes equal to approximately $880,000 . The Company used the net proceeds to redeem all of its existing 6.75% Notes, together with accrued interest, related premiums, fees and expenses and recorded a charge for the loss on redemption of such notes of $33,298 , including write offs of unamortized original issue premium and debt issuance costs. Remaining proceeds were used for general corporate purposes, including funding of deferred acquisition consideration. The 6.50% Notes are guaranteed on a senior unsecured basis by all of MDC’s existing and future restricted subsidiaries that guarantee, are co-borrowers under, or grant liens to secure, the Credit Agreement. The 6.50% Notes are unsecured and unsubordinated obligations of MDC and rank (i) equally in right of payment with all of MDC’s or any Guarantor’s existing and future senior indebtedness, (ii) senior in right of payment to MDC’s or any Guarantor’s existing and future subordinated indebtedness, (iii) effectively subordinated to all of MDC’s or any Guarantor’s existing and future secured indebtedness to the extent of the collateral securing such indebtedness, including the Credit Agreement, and (iv) structurally subordinated to all existing and future liabilities of MDC’s subsidiaries that are not Guarantors. MDC may, at its option, redeem the 6.50% Notes in whole at any time or in part from time to time, on and after May 1, 2019 (i) at a redemption price of 104.875% of the principal amount thereof if redeemed during the twelve-month period beginning on May 1, 2019 , (ii) at a redemption price of 103.250% of the principal amount thereof if redeemed during the twelve-month period beginning on May 1, 2020 , (iii) at a redemption price of 101.625% of the principal amount thereof if redeemed during the twelve-month period beginning on May 1, 2021 , and (iv) at a redemption price of 100% of the principal amount thereof if redeemed on May 1, 2022 and thereafter. Prior to May 1, 2019 , MDC may, at its option, redeem some or all of the 6.50% Notes at a price equal to 100% of the principal amount of the 6.50% Notes plus a “make whole” premium and accrued and unpaid interest. MDC may also redeem, at its option, prior to May 1, 2019 , up to 35% of the 6.50% Notes with the proceeds from one or more equity offerings at a redemption price of 106.50% of the principal amount thereof. If MDC experiences certain kinds of changes of control (as defined in the Indenture), holders of the 6.50% Notes may require MDC to repurchase any 6.50% Notes held by them at a price equal to 101% of the principal amount of the 6.50% Notes plus accrued and unpaid interest. In addition, if MDC sells assets under certain circumstances, it must apply the proceeds from such sale and offer to repurchase the 6.50% Notes at a price equal to 100% of the principal amount plus accrued and unpaid interest. The Indenture includes covenants that, among other things, restrict MDC’s ability and the ability of its restricted subsidiaries (as defined in the Indenture) to incur or guarantee additional indebtedness; pay dividends on or redeem or repurchase the capital stock of MDC; make certain types of investments; create restrictions on the payment of dividends or other amounts from MDC’s restricted subsidiaries; sell assets; enter into transactions with affiliates; create liens; enter into sale and leaseback transactions; and consolidate or merge with or into, or sell substantially all of MDC’s assets to, another person. These covenants are subject to a number of important limitations and exceptions. The 6.50% Notes are also subject to customary events of default, including a cross-payment default and cross-acceleration provision. The Company was in compliance with all covenants at December 31, 2017. Redemption of 6.75% Notes On March 23, 2016, the Company redeemed the 6.75% Notes in whole at a redemption price of 103.375% of the principal amount thereof with the proceeds from the issuance of the 6.50% Notes. Credit Agreement On March 20, 2013, MDC, Maxxcom Inc. (a subsidiary of MDC) and each of their subsidiaries party thereto entered into an amended and restated, $225,000 senior secured revolving credit agreement due 2018 (the “Credit Agreement”) with Wells Fargo Capital Finance, LLC, as agent, and the lenders from time to time party thereto. Advances under the Credit Agreement are to be used for working capital and general corporate purposes, in each case pursuant to the terms of the Credit Agreement. Capitalized terms used in this section and not otherwise defined have the meanings set forth in the Credit Agreement. Effective October 23, 2014, MDC and its subsidiaries entered into an amendment to its Credit Agreement. The amendment: (i) expanded the commitments under the facility by $100,000 , from $225,000 to $325,000 ; (ii) extended the date by an additional eighteen months to September 30, 2019 ; (iii) reduced the base borrowing interest rate by 25 basis points (the applicable margin for borrowing is 1.00% in the case of Base Rate Loans and 1.75% in the case of LIBOR Rate Loans); and (iv) modified certain covenants to provide the Company with increased flexibility to fund its continued growth and other general corporate purposes. Effective May 3, 2016, MDC and its subsidiaries entered into an additional amendment to its Credit Agreement. The amendment: (i) extended the date by an additional nineteen months to May 3, 2021 ; (ii) reduced the base borrowing interest rate by 25 basis points; (iii) provided the Company the ability to borrow in foreign currencies; and (iv) certain other modifications which provided additional flexibility in operating the Company’s business. Advances under the Credit Agreement bear interest as follows: (a)(i) LIBOR Rate Loans bear interest at the LIBOR Rate and (ii) Base Rate Loans bear interest at the Base Rate, plus (b) an applicable margin. The initial applicable margin for borrowing is 0.75% in the case of Base Rate Loans and 1.50% in the case of LIBOR Rate Loans. In addition to paying interest on outstanding principal under the Credit Agreement, MDC is required to pay an unused revolver fee to lenders under the Credit Agreement in respect of unused commitments thereunder. The Credit Agreement is guaranteed by substantially all of MDC’s present and future subsidiaries, other than immaterial subsidiaries and subject to customary exceptions. The Credit Agreement includes covenants that, among other things, restrict MDC’s ability and the ability of its subsidiaries to incur or guarantee additional indebtedness; pay dividends on or redeem or repurchase the capital stock of MDC; make certain types of investments; impose limitations on dividends or other amounts from MDC’s subsidiaries; incur certain liens, sell or otherwise dispose of certain assets; enter into transactions with affiliates; enter into sale and leaseback transactions; and consolidate or merge with or into, or sell substantially all of MDC’s assets to, another person. These covenants are subject to a number of important limitations and exceptions. The Credit Agreement also contains financial covenants, including a total leverage ratio, a senior leverage ratio, a fixed charge coverage ratio and a minimum earnings level (each as more fully described in the Credit Agreement). The Credit Agreement is also subject to customary events of default. The Company is currently in compliance with all of the terms and conditions of its Credit Agreement, and management believes, based on its current financial projections, that the Company will be in compliance with the covenants over the next twelve months. At December 31, 2017 , there were no borrowings under the Credit Agreement. At December 31, 2017 , the Company had issued $5,056 of undrawn letters of credit. At December 31, 2017 and 2016 , accounts payable included $41,989 and $80,193 , respectively, of outstanding checks. Future Principal Repayments Future principal repayments, including capital lease obligations, for the years ended December 31, and in aggregate, are as follows: Period Amount 2018 $ 313 2019 320 2020 68 2021 5 2022 — 2023 and thereafter 900,000 $ 900,706 Capital Leases Future minimum capital lease payments for the years ended December 31 and in aggregate, are as follows: Period Amount 2018 $ 313 2019 320 2020 68 2021 5 2022 — 2023 and thereafter — 706 Less: imputed interest (59 ) 647 Less: current portion (313 ) $ 334 |
Share Capital
Share Capital | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share Capital | 11. Share Capital The authorized share capital of the Company is as follows: (a) Authorized Share Capital Series 4 Convertible Preference Shares A total of 95,000 , non-voting convertible preference shares, all of which were issued and outstanding as of December 31, 2017 . See Note 12 of the Notes to the Consolidated Financial Statements included herein for further information. There were no such shares issued and outstanding as of December 31, 2016 . Class A Shares An unlimited number of subordinate voting shares, carrying one vote each, entitled to dividends equal to or greater than Class B shares, convertible at the option of the holder into one Class B share for each Class A share after the occurrence of certain events related to an offer to purchase all Class B shares. Class B Shares An unlimited number, carrying 20 votes each, convertible at any time at the option of the holder into one Class A share for each Class B share. Preferred A Shares An unlimited number, non-voting, issuable in series. (b) Employee Stock Incentive Plan On May 26, 2005, the Company’s shareholders approved the Company’s 2005 Stock Incentive Plan (the “2005 Incentive Plan”). The 2005 Incentive Plan authorizes the issuance of awards to employees, officers, directors and consultants of the Company with respect to 3,000,000 shares of MDC Partners’ Class A Subordinate Voting Shares or any other security into which such shares shall be exchanged. On June 1, 2007 and on June 2, 2009, the Company’s shareholders approved a total additional authorized Class A Shares of 3,750,000 to be added to the 2005 Incentive Plan for a total of 6,750,000 authorized Class A Shares. In addition, the plan was amended to allow shares under this plan to be used to satisfy share obligations under the Stock Appreciation Rights Plan (the “SARS” Plan”). On May 30, 2008, the Company’s shareholders approved the 2008 Key Partner Incentive Plan, which provides for the issuance of 900,000 Class A Shares. On June 1, 2011, the Company’s shareholders approved the 2011 Stock Incentive Plan, which provides for the issuance of up to 3,000,000 Class A Shares. In June 2013, the Company’s shareholders approved an amendment to the SARS Plan to permit the Company to issue shares authorized under the SARS Plan to satisfy the grant and vesting awards under the 2011 Stock Incentive Plan. On June 1, 2016, the Company’s shareholders approved the 2016 Stock Incentive Plan, which provides for the issuance of up to 1,500,000 Class A shares. The following table summarizes information about time based and financial performance-based restricted stock and restricted stock unit awards granted under the 2005 Incentive Plan, 2008 Key Partner Incentive Plan, 2011 Stock Incentive Plan and 2016 Stock Incentive Plan: Performance Based Awards Time Based Awards Shares Weighted Average Grant Date Fair Shares Weighted Average Balance at December 31, 2014 86,030 $ 23.14 916,141 $ 16.36 Granted 80,000 21.76 191,155 20.42 Vested (68,067 ) 25.21 (297,794 ) 12.35 Forfeited — — (35,000 ) 21.69 Balance at December 31, 2015 97,963 $ 19.61 774,502 $ 18.71 Granted 10,000 14.00 392,500 12.53 Vested (17,963 ) 10.02 (380,367 ) 16.02 Forfeited — — (46,000 ) 20.39 Balance at December 31, 2016 90,000 $ 20.90 740,635 $ 16.71 Granted — — 358,000 8.98 Vested (90,000 ) 20.90 (277,050 ) 19.62 Forfeited — — (36,500 ) 14.15 Balance at December 31, 2017 — $ — 785,085 $ 12.28 The total fair value of restricted stock and restricted stock unit awards, which vested during the years ended December 31, 2017 , 2016 and 2015 was $7,316 , $6,272 and $5,394 , respectively. In connection with the vesting of these awards, the Company included in the taxable loss the amounts of $3,500 , $5,429 and $4,678 in 2017 , 2016 and 2015 , respectively. At December 31, 2017 , the weighted average remaining contractual life for time based awards was 1.62 years. At December 31, 2017 , the fair value of all restricted stock and restricted stock unit awards was $7,655 . The term of these awards is three years with vesting up to three years . At December 31, 2017 , the unrecognized compensation expense for these awards was $4,696 and will be recognized through 2019. At December 31, 2017 , there were 579,748 awards available to grant under all equity plans. In addition, the Company awarded restricted stock and restricted stock unit awards of which 1,433,921 awarded shares were outstanding as of December 31, 2017 . The vesting of these awards is contingent upon the Company meeting a cumulative three year earnings target and continued employment through the vesting date. Once the Company defines the earnings target, the grant date is established and the Company will record the compensation expense over the vesting period. Prior to adoption of the 2005 Incentive Plan, the Company’s Prior 2003 Plan provided for grants of up to 2,836,179 options to employees, officers, directors and consultants of the Company. All the options granted were for a term of five years from the date of the grant and vest 20% on the date of grant and a further 20% on each anniversary date. In addition, the Company granted 802,440 options, on the privatization of Maxxcom, with a term of no more than 10 years from initial date of grant by Maxxcom and vest 20% in each of the first two years with the balance vesting on the third anniversary of the initial grant. Information related to share option transactions grant under all plans over the past three years is summarized as follows: Options Outstanding Options Exercisable Non Vested Options Number Outstanding Weighted Average Number Outstanding Weighted Average Balance at December 31, 2014 112,500 $ 5.70 112,500 $ 5.70 — Vested — — — — — Granted — — — — — Exercised 37,500 4.72 — — — Expired and canceled — — — — — Balance at December 31, 2015 75,000 $ 5.28 75,000 $ 5.28 — Vested — — — — — Granted — — — — — Exercised 37,500 5.97 — — — Expired and canceled — — — — — Balance at December 31, 2016 37,500 $ 5.83 37,500 $ 5.83 — Vested — — — — — Granted — — — — — Exercised 37,500 5.83 — — — Expired and canceled — — — — — Balance at December 31, 2017 — $ — — $ — — For options exercised during 2017 , 2016 and 2015 , the Company received cash proceeds of nil , nil and $224 , respectively. The Company did not receive any windfall tax benefits. The intrinsic value of options exercised during 2017 , 2016 and 2015 was $125 , $471 and $471 , respectively. At December 31, 2017 , the unrecognized compensation expense of all options was nil . (c) Stock Appreciation Rights During 2017, the Compensation Committee of the Board of Directors approved a SAR’s compensation program for senior officers and directors of the Company. SAR’s granted in 2017 have a term of up to five years. Awards vest on the third anniverary of the grant date. SAR’s granted and outstanding are as follows: SARs Outstanding SARs Exercisable Non Vested SARs Number Outstanding Weighted Average Number Outstanding Weighted Average Balance at December 31, 2016 — $ — $ — $ — — Vested — — — — — Granted 327,500 6.60 — — 327,500 Exercised — — — — — Expired and canceled — — — — — Balance at December 31, 2017 327,500 $ 6.60 — $ — 327,500 At December 31, 2017, the unrecognized compensation expense of all SARs was $535. The Company has reserved a total of 3,126,254 Class A shares in order to meet its obligations under various conversion rights, warrants and employee share related plans. At December 31, 2017 there were 579,748 shares available for future option and similar grants. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 13. Fair Value Measurements Authoritative guidance for fair value establishes a framework for measuring fair value. A fair value measurement assumes a transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. In order to increase consistency and comparability in fair value measurements, the guidance establishes a hierarchy for observable and unobservable inputs used to measure fair value into three broad levels, which are described below: • Level 1 - Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. • Level 2 - Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. • Level 3 - Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. Financial Liabilities Measured at Fair Value on a Non-Recurring Basis The following table presents certain information for our financial liability that is measured at fair value on a non-recurring basis at December 31: 2017 2016 Carrying Amount Fair Value Carrying Amount Fair Value Liabilities: 6.50% Senior Notes due 2024 900,000 904,500 900,000 812,250 Our long-term debt includes fixed rate debt. The fair value of this instrument is based on quoted market prices. Financial Liabilities Measured at Fair Value on a Recurring Basis The following table presents changes in deferred acquisition consideration which is measured at fair value on recurring basis for the years ended December 31: Fair Value Measurements Using 2017 2016 Beginning balance of contingent payments $ 224,754 $ 306,734 Payments (1) (110,234 ) (105,169 ) Additions (2) — 16,132 Redemption value adjustments (3) 3,273 13,930 Other (4) — (6,412 ) Foreign translation adjustment 1,293 (461 ) Ending balance of contingent payments $ 119,086 $ 224,754 (1) For the year ended December 31, 2017 and 2016, payments include $28,727 and $10,458 , respectively, of deferred acquisition consideration settled through the issuance of 3,353,939 and 691,559 , respectively, MDC Class A subordinate voting shares in lieu of cash. (2) Additions are the initial estimated deferred acquisition payments of new acquisitions and step-up transactions completed within that fiscal period. (3) Redemption value adjustments are fair value changes from the Company’s initial estimates of deferred acquisition payments, including the accretion of present value and stock-based compensation charges relating to acquisition payments that are tied to continued employment. (4) Other is comprised of (i) $2,360 transferred to shares to be issued related to 100,000 MDC Class A subordinate voting shares to be issued contingent on specific thresholds of future earnings that management expects to be attained; and, (ii) $4,052 of contingent payments eliminated through the acquisition of incremental ownership interests. See Note 4 of the Notes to the Consolidated Financial Statements included herein for further information. In addition to the above amounts, there are fixed payments of $3,340 and $4,810 for total deferred acquisition consideration of $122,426 and $229,564 , which reconciles to the consolidated balance sheets at December 31, 2017 and 2016 , respectively. The Company includes the payments of all deferred acquisition consideration in financing activities in the Company’s consolidated statement of cash flows, as the Company believes these payments to be seller-related financing activities, which is the predominant source of cash flows. The FASB recently issued new guidance regarding the classification of cash flows for contingent consideration that is effective January 1, 2018. See Note 18 of the Notes to the Consolidated Financial Statements included herein for further information. Level 3 payments relate to payments made for deferred acquisition consideration. Level 3 grants relate to contingent purchase price obligations related to acquisitions and are recorded on the balance sheet at the acquisition date fair value. The estimated liability is determined in accordance with various contractual valuation formulas that may be dependent on future events, such as the growth rate of the earnings of the relevant subsidiary during the contractual period and, in some cases, the currency exchange rate as of the date of payment. Level 3 redemption value adjustments relate to the remeasurement and change in these various contractual valuation formulas as well as adjustments of present value. At December 31, 2017 and 2016 , the carrying amount of the Company’s financial instruments, including cash and cash equivalents, accounts receivable and accounts payable, approximated fair value because of their short-term maturity. The Company does not disclose the fair value for equity method investments or investments held at cost as it is not practical to estimate fair value since there is no readily available market data. Non-financial Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis On a nonrecurring basis, the Company uses fair value measures when analyzing asset impairment. Long-lived assets and certain identifiable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If it is determined such indicators are present and the review indicates that the assets will not be fully recoverable, based on undiscounted estimated cash flows over the remaining amortization periods, their carrying values are reduced to estimated fair value. Measurements based on undiscounted cash flows are considered to be Level 3 inputs. During the fourth quarter of each year, the Company evaluates goodwill and indefinite-lived intangibles for impairment at the reporting unit level. For each acquisition, the Company performed a detailed review to identify intangible assets and a valuation is performed for all such identified assets. The Company used several market participant measurements to determine estimated value. This approach includes consideration of similar and recent transactions, as well as utilizing discounted expected cash flow methodologies. The amounts allocated to assets acquired and liabilities assumed in the acquisitions were determined using Level 3 inputs. Fair value for property and equipment was based on other observable transactions for similar property and equipment. Accounts receivable represents the best estimate of balances that will ultimately be collected, which is based in part on allowance for doubtful accounts reserve criteria and an evaluation of the specific receivable balances. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | 15 . Segment Information The Company determines an operating segment if a component (i) engages in business activities from which it earns revenues and incurs expenses, (ii) has discrete financial information, and is (iii) regularly reviewed by the Chief Operating Decision Maker (“CODM”) to make decisions regarding resource allocation for the segment and assess its performance. Once operating segments are identified, the Company performs an analysis to determine if aggregation of its operating segments is consistent with the principles detailed in ASC 280. This determination is based upon a quantitative analysis of the expected and historic average long-term profitability for each operating segment, together with an assessment of the qualitative characteristics set forth in ASC Topic 280-10-50. The four reportable segments that result from applying the aggregation criteria are as follows: “Global Integrated Agencies”; “Domestic Creative Agencies”; “Specialist Communications”; and “Media Services.” In addition, the Company combines and discloses those operating segments that do not meet the aggregation criteria as “All Other.” The Company also reports corporate expenses, as further detailed below, as “Corporate.” All segments follow the same basis of presentation and accounting policies as those described in Note 1 and 2 of the Notes to the Consolidated Financial Statements included herein, respectively. • The Global Integrated Agencies reportable segment is comprised of the Company’s six global, integrated operating segments with broad marketing communication capabilities, including advertising, branding, digital, social media, design and production services, serving multinational clients around the world. The Global Integrated Agencies reportable segment includes 72andSunny, Anomaly, Crispin Porter + Bogusky, Doner, Forsman & Bodenfors, and kbs+. These operating segments share similar characteristics related to (i) the nature of their services; (ii) the type of global clients and the methods used to provide services; and (iii) the extent to which they may be impacted by global economic and geopolitical risks. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Global Integrated Agencies reportable segment. • The Domestic Creative Agencies reportable segment is comprised of four operating segments that are national advertising agencies leveraging creative capabilities at their core. The Domestic Creative Agencies reportable segment includes Colle + McVoy, Laird+Partners, Mono Advertising and Union. These operating segments share similar characteristics related to (i) the nature of their creative advertising services; (ii) the type of domestic client accounts and the methods used to provide services; and (iii) the extent to which they may be impacted by domestic economic and policy factors within North America. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Domestic Creative Agencies reportable segment. • The Specialist Communications reportable segment is comprised of seven operating segments that are each communications agencies with core service offerings in public relations and related communications services. The Specialist Communications reportable segment includes Allison & Partners, Hunter PR, HL Group Partners, Kwittken, Luntz Global, Sloane & Company and Veritas. These operating segments share similar characteristics related to (i) the nature of their public relations and communication services, including content creation, social media and influencer marketing; (ii) the type of client accounts and the methods used to provide services; (iii) the extent to which they may be impacted by domestic economic and policy factors within North America; and (iv) the regulatory environment regarding public relations and social media. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Specialist Communications reportable segment. • The Media Services reportable segment is comprised of a single operating segment known as MDC Media Partners. MDC Media Partners is comprised of the Company’s network of stand-alone agencies with media buying and planning as their core competency, including the integrated platform Assembly. The agencies within this single operating segment share a Chief Executive Officer and Chief Financial Officer, who have operational oversight of these agencies. These agencies provide other services, including influencer marketing, content, insights & analytics, out-of-home, paid search, social media, lead generation, programmatic, artificial intelligence, and corporate barter. MDC Media Partners operates primarily in North America. • All Other consists of the Company’s remaining operating segments that provide a range of diverse marketing communication services, but generally do not have similar services offerings or financial characteristics as those aggregated in the reportable segments. The All Other category includes 6Degrees, Bruce Mau Design, Concentric Partners, Civilian, Gale Partners, Hello Design, Kenna, Kingsdale, Northstar Research Partners, Redscout, Relevent, Source Marketing, Team, Vitro, Yamamoto and Y Media Labs. The nature of the specialist services provided by these operating segments vary among each other and from those operating segments aggregated into the reportable segments. This results in these operating segments having current and long-term performance expectations inconsistent with those operating segments aggregated in the reportable segments. • Corporate consists of corporate office expenses incurred in connection with the strategic resources provided to the operating segments, as well as certain other centrally managed expenses that are not fully allocated to the operating segments. These office and general expenses include (i) salaries and related expenses for corporate office employees, including employees dedicated to supporting the operating segments, (ii) occupancy expenses relating to properties occupied by all corporate office employees, (iii) other office and general expenses including professional fees for the financial statement audits and other public company costs, and (iv) certain other professional fees managed by the corporate office. Additional expenses managed by the corporate office that are directly related to the operating segments are allocated to the appropriate reportable segment and the All Other category. Years Ended December 31, 2017 2016 2015 Revenue: Global Integrated Agencies $ 786,644 $ 696,410 $ 652,987 Domestic Creative Agencies 90,663 85,953 91,658 Specialist Communications 172,565 170,285 153,920 Media Services 142,387 131,498 132,419 All Other 321,520 301,639 295,272 Total $ 1,513,779 $ 1,385,785 $ 1,326,256 Segment operating income (loss): Global Integrated Agencies $ 74,902 $ 58,505 $ 66,161 Domestic Creative Agencies 16,977 16,583 17,535 Specialist Communications 20,714 1,939 18,047 Media Services 12,963 6,154 20,116 All Other 47,259 9,368 15,423 Corporate (40,856 ) (44,118 ) (65,172 ) Total $ 131,959 $ 48,431 $ 72,110 Other Income (Expense): Other income, net 1,346 414 7,238 Foreign exchange gain (loss) 18,137 (213 ) (39,328 ) Interest expense and finance charges, net (64,364 ) (65,858 ) (57,436 ) Loss on redemption of Notes — (33,298 ) — Income (loss) from continuing operations before income taxes and equity in earnings of non-consolidated affiliates 87,078 (49,716 ) (17,416 ) Income tax expense (benefit) (168,064 ) (9,404 ) 3,761 Income (loss) from continuing operations before equity in earnings of non-consolidated affiliates 255,142 (40,312 ) (21,177 ) Equity in earnings (loss) of non-consolidated affiliates 2,081 (309 ) 1,058 Income (loss) from continuing operations 257,223 (40,621 ) (20,119 ) Income (loss) from discontinued operations attributable to MDC Partners Inc., net of taxes — — (6,281 ) Net income (loss) 257,223 (40,621 ) (26,400 ) Net income attributable to the noncontrolling interest (15,375 ) (5,218 ) (9,054 ) Net income (loss) attributable to MDC Partners Inc. $ 241,848 $ (45,839 ) $ (35,454 ) Years Ended December 31, 2017 2016 2015 Depreciation and amortization: Global Integrated Agencies $ 23,800 $ 21,447 $ 20,599 Domestic Creative Agencies 1,434 1,653 1,855 Specialist Communications 4,714 6,637 11,201 Media Services 3,629 5,718 4,660 All Other 8,799 9,406 12,134 Corporate 1,098 1,585 1,774 Total $ 43,474 $ 46,446 $ 52,223 Stock-based compensation: Global Integrated Agencies $ 15,203 $ 12,141 $ 6,981 Domestic Creative Agencies 845 634 644 Specialist Communications 2,954 3,629 1,510 Media Services 614 301 471 All Other 2,600 1,773 5,450 Corporate 2,134 2,525 2,740 Total $ 24,350 $ 21,003 $ 17,796 Capital expenditures: Global Integrated Agencies $ 20,748 $ 16,439 $ 17,043 Domestic Creative Agencies 1,032 1,055 1,321 Specialist Communications 1,288 2,741 1,311 Media Services 3,035 5,110 825 All Other 6,832 4,054 2,704 Corporate 23 33 371 Total $ 32,958 $ 29,432 $ 23,575 A summary of the Company’s long-lived assets, comprised of fixed assets, goodwill and intangibles, net, by geographic region at December 31, is set forth in the following table. United States Canada Other Total Long-lived Assets 2017 $ 77,163 $ 5,638 $ 7,505 $ 90,306 2016 $ 67,617 $ 5,887 $ 4,873 $ 78,377 Goodwill and Intangible Assets 2017 $ 706,241 $ 127,014 $ 73,285 $ 906,540 2016 $ 736,334 $ 121,987 $ 71,509 $ 929,830 The Company’s CODM does not use segment assets to allocate resources or to assess performance of the segments and therefore, total segment assets have not been disclosed. A summary of the Company’s revenue by geographic region at December 31 is set forth in the following table. United States Canada Other Total Revenue: 2017 $ 1,172,364 $ 123,092 $ 218,323 $ 1,513,779 2016 $ 1,103,714 $ 124,101 $ 157,970 $ 1,385,785 2015 $ 1,085,051 $ 129,039 $ 112,166 $ 1,326,256 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 16. Related Party Transaction Scott L. Kauffman is Chairman and Chief Executive Officer of the Company. His daughter, Sarah Kauffman, has been employed by Partner Firm kbs since July 2011, and currently acts as Director of Operations, Attention Partners. In 2017 and 2016 , her total compensation, including salary, bonus and other benefits, totaled approximately $155 and $145 , respectively. Her compensation is commensurate with that of her peers. |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Guarantees | . Commitments, Contingencies and Guarantees Deferred Acquisition Consideration . In addition to the consideration paid by the Company in respect of certain of its acquisitions at closing, additional consideration may be payable, or may be potentially payable, based on the achievement of certain threshold levels of earnings. See Note 2 and Note 4. Options to Purchase . Noncontrolling shareholders in certain subsidiaries have the right in certain circumstances to require the Company to acquire the remaining ownership interests held by them. The noncontrolling shareholders’ ability to exercise any such option right is subject to the satisfaction of certain conditions, including conditions requiring notice in advance of exercise and specific employment termination conditions. In addition, these rights cannot be exercised prior to specified staggered exercise dates. The exercise of these rights at their earliest contractual date would result in obligations of the Company to fund the related amounts during 2017 to 2023 . It is not determinable, at this time, if or when the owners of these rights will exercise all or a portion of these rights. The amount payable by the Company in the event such rights are exercised is dependent on various valuation formulas and on future events, such as the average earnings of the relevant subsidiary through the date of exercise, the growth rate of the earnings of the relevant subsidiary during that period and, in some cases, the currency exchange rate at the date of payment. Management estimates, assuming that the subsidiaries owned by the Company at December 31, 2017 perform over the relevant future periods at their trailing twelve-month earnings levels, that these rights, if all exercised, could require the Company to pay an aggregate amount of approximately $15,864 to the owners of such rights in future periods to acquire such ownership interests in the relevant subsidiaries. Of this amount, the Company is entitled, at its option, to fund approximately $184 by the issuance of share capital. In addition, the Company is obligated under similar put option rights to pay an aggregate amount of approximately $41,748 only upon termination of such owner’s employment with the applicable subsidiary or death. The amount the Company would be required to pay to the noncontrolling interest holders should the Company acquire the remaining ownership interests is $5,272 less than the initial redemption value recorded in redeemable noncontrolling interests. Included in redeemable noncontrolling interests at December 31, 2017 was $62,886 of these put options because they are not within the control of the Company. The ultimate amount payable relating to these transactions will vary because it is dependent on the future results of operations of the subject businesses and the timing of when these rights are exercised. Natural Disasters . Certain of the Company’s operations are located in regions of the United States which typically are subject to hurricanes. During the years ended December 31, 2017 , 2016 , and 2015 , these operations did not incur any material costs related to damages resulting from hurricanes. Guarantees . Generally, the Company has indemnified the purchasers of certain assets in the event that a third party asserts a claim against the purchaser that relates to a liability retained by the Company. These types of indemnification guarantees typically extend for a number of years. Historically, the Company has not made any significant indemnification payments under such agreements and no amount has been accrued in the accompanying consolidated financial statements with respect to these indemnification guarantees. The Company continues to monitor the conditions that are subject to guarantees and indemnifications to identify whether it is probable that a loss has occurred and would recognize any such losses under any guarantees or indemnifications in the period when those losses are probable and estimable. Legal Proceedings . The Company’s operating entities are involved in legal proceedings of various types. While any litigation contains an element of uncertainty, the Company has no reason to believe that the outcome of such proceedings or claims will have a material adverse effect on the financial condition or results of operations of the Company. Among the legal proceedings in which the Company is involved are the class action suits as described below. MDC Partners remains committed to the highest standards of corporate governance and transparency in its reporting practices. In April 2015, the Company announced it was actively cooperating in connection with an SEC investigation of the Company. On January 18, 2017, the Company announced that it reached a final settlement agreement with the Philadelphia Regional Office of the SEC, and that the SEC entered an administrative Order concluding its investigation of the Company. Under the Order, without admitting or denying liability, the Company agreed that it will not in the future violate Section 17(a)(2) of the Securities Act of 1933 and Sections 13(a), 13(b) and 14(a) of the Securities Exchange Act of 1934 and related rules requiring that periodic filings be accurate; that accurate books and records and a system of internal accounting controls be maintained; and that solicitations of proxies comply with the securities laws. In addition, the Company agreed to comply with all requirements under Regulation G relating to the disclosure and reconciliation of non-GAAP financial measures. Pursuant to the Order, and based upon the Company’s full cooperation with the investigation, the SEC imposed a civil penalty of $1,500 on the Company to resolve all potential claims against the Company relating to these matters. In 2016, the Company recorded a charge of $1,500 related to such penalty. There will be no restatement of any of the Company’s previously-filed financial statements. On July 31, 2015, North Collier Fire Control and Rescue District Firefighter Pension Plan (“North Collier”) filed a putative class action suit in the Southern District of New York, naming as defendants MDC, CFO David Doft, former CEO Miles Nadal, and former CAO Mike Sabatino. On December 11, 2015, North Collier and co-lead plaintiff Plymouth County Retirement Association filed an amended complaint, adding two additional defendants, Mitchell Gendel and Michael Kirby, a former member of MDC’s Board of Directors. The plaintiff alleges in the amended complaint violations of § 10(b), Rule 10b-5, and § 20 of the Securities Exchange Act of 1934, based on allegedly materially false and misleading statements in the Company’s SEC filings and other public statements regarding executive compensation, goodwill accounting, and the Company’s internal controls. The Company filed a motion to dismiss the amended complaint on February 9, 2016, the lead plaintiffs filed an opposition to that motion on April 8, 2016, and the Company filed a reply brief on May 9, 2016. By order granted on September 30, 2016, the U.S. District Court presiding over the case granted the Company’s motion to dismiss the plaintiffs’ amended complaint in its entirety with prejudice. On November 2, 2016, the lead plaintiffs filed a notice to appeal the U.S. District Court’s ruling to the U.S. Court of Appeals for the Second Circuit. On February 21, 2017, the lead plaintiffs voluntarily dismissed their appeal. On August 7, 2015, Roberto Paniccia issued a Statement of Claim in the Ontario Superior Court of Justice in the City of Brantford, Ontario seeking to certify a class action suit naming the following as defendants: MDC, former CEO Miles S. Nadal, former CAO Michael C. Sabatino, CFO David Doft and BDO U.S.A. LLP. The Plaintiff alleges violations of section 138.1 of the Ontario Securities Act (and equivalent legislation in other Canadian provinces and territories) as well as common law misrepresentation based on allegedly materially false and misleading statements in the Company’s public statements, as well as omitting to disclose material facts with respect to the SEC investigation. The Company intends to continue to vigorously defend this suit. The plaintiff has served his material for leave to proceed under the Ontario Securities Act and that motion is currently scheduled to be heard in April 2018. A motion by the Company and other defendants to address the scope of the proposed class definition was dismissed and the Company is appealing that decision. In June 2016, one of the Company’s subsidiaries received a subpoena from the U.S. Department of Justice Antitrust Division concerning the Division’s ongoing investigation of production practices in the advertising industry. The Company and its subsidiary are continuing to fully cooperate with this confidential investigation. Commitments . At December 31, 2017 , the Company had $5,056 of undrawn letters of credit. In addition, the Company has commitments to fund investments in an aggregate amount of $148 . Leases . The Company and its subsidiaries lease certain facilities and equipment. For the years ended December 31, 2017 , 2016 , and 2015 , gross premises rental expense amounted to $64,086 , $56,725 , and $47,583 , respectively, which was reduced by sublease income of $2,797 , $3,027 , and $1,739 , respectively. Where leases contain escalation clauses or other concessions, the impact of such adjustments is recognized on a straight-line basis over the minimum lease period. Minimum rental commitments for the rental of office and production premises and equipment under non-cancellable leases net of sublease income, some of which provide for rental adjustments due to increased property taxes and operating costs, for the years ending December 31, 2018 and thereafter, are as follows: Period Amount 2018 $ 58,172 2019 56,751 2020 55,065 2021 41,830 2022 32,595 2023 and thereafter 122,947 $ 367,360 At December 31, 2017 , the total future cash to be received on sublease income is $17,369 . |
New Accounting Pronouncements
New Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | 18. New Accounting Pronouncements Revenue Recognition In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which will replace all existing revenue guidance under U.S GAAP. The core principle of ASU 2014-09 is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration expected to be received in exchange for those goods or services. ASU 2014-09 provides for one of two methods of transition: (i) retrospective application to each prior period presented (Full Retrospective); or (ii) recognition of the cumulative effect of retrospective application of the new standard as of the beginning of the period of initial application (Modified Retrospective). The Company will adopt ASU 2014-09 on the effective date of January 1, 2018, and will apply the Modified Retrospective method. The cumulative effect of the initial adoption is recognized as an adjustment to opening retained earnings at January 1, 2018. The Company is in the process of calculating this adjustment, however has not completed the calculation as of the filing date of this Form 10-K. As a result, the adjustment will be reflected and disclosed in its financial statements included within its Quarterly Report on Form 10-Q for the three months ending March 31, 2018. Effective January 1, 2018, the Company has implemented new policies and procedures to ensure the appropriate application of the new standard during the first quarter of 2018. The Company’s assessment of the impact of adopting the new standard on its accounting policies is essentially complete. The greatest impact the standard will have is on the timing in which revenue is recognized. There are several areas where the Company’s revenue recognition is expected to change as compared with historical GAAP. The more significant of these areas are as follows: i. The standard will result in an increase in the number of performance obligations within certain of our contractual arrangements, whereby most of our contractual arrangements will have more than one performance obligation. ii. Under the guidance in effect through December 31, 2017, performance incentives are recognized in revenue when specific quantitative goals are achieved, or when the Company’s performance against qualitative goals is determined by the client. Under the new standard, the Company will be required to estimate the amount of the incentive that will be earned at the inception of the contract and recognize such incentive over the term of the contract. This will result in an acceleration of revenue recognition for certain contract incentives compared to the current method. iii. Under the guidance in effect through December 31, 2017, non-refundable retainer fees are generally recognized on a straight-line basis over the term of the specific customer arrangement. Under the new standard, an input method will be used to measure progress and record revenue for these types of arrangements. Based on the Company’s assessment, an input measure such as cost-to-cost or labor hours will be an appropriate measure of progress in the majority of situations for which over time revenue recognition is applied. The change is expected to either defer or accelerate revenue recognition in certain instances. Revenue recognition for commission-based arrangements will continue to be recognized point-in-time. In certain businesses, the Company records revenue as a principal and includes within revenue certain third-party-pass-through and out-of-pocket costs, which are billed to clients in connection with the services provided. In other businesses, the Company acts as an agent within our arrangements and records revenue equal to the net amount retained. In March 2016, the FASB issued further guidance on principal versus agent considerations; however, our assessments indicate that such change is not expected to have a material effect on the Company’s results of operations. Other In January 2018, the FASB released guidance on the accounting for tax on the global intangible low-taxed income (“GILTI”) provisions of the Tax Cuts and Jobs Act (the “Act”). The GILTI provisions impose a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations. The guidance indicates that either accounting for deferred taxes related to GILTI inclusions or treating any taxes on GILTI inclusions as period cost are both acceptable methods subject to an accounting policy election. The Company continues to assess the impact of GILTI provisions on its financial statements and whether it will be subject to U.S. GILTI inclusion in future years. As such, the Company has not made a policy election on whether to record tax effects of GILTI when paid as a period expense or to record deferred tax assets and liabilities on basis differences that are expected to affect the amount of GILTI inclusion. In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation: Scope of Modification Accounting, which provides guidance concerning which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in ASC 718. This guidance is effective for annual and interim periods beginning after December 15, 2017, and early adoption is permitted. Amendments in this ASU will be applied prospectively to any award modified on or after the adoption date. The Company does not expect the application of this guidance to have a significant impact on its consolidated financial position or results of operations. In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits, which requires the presentation of the service cost component of the net periodic pension and postretirement benefits costs in the same line item in the statement of operations as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of the net periodic pension and postretirement benefits costs are required to be presented as non-operating expenses in the statement of operations. This guidance is effective for annual periods beginning after December 15, 2017 and early adoption is permitted. The Company does not expect the application of this guidance to have a significant impact on its consolidated financial position or results of operations. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment, which eliminates step two from the two-step goodwill impairment test. Under the new guidance, an entity will perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value provided the loss recognized does not exceed the total amount of goodwill allocated to that reporting unit. This guidance is effective for annual or interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019. The Company early adopted this guidance for its impairment test performed during 2017. The application of this guidance did not have a significant impact on its consolidated financial position or results of operations. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows. This new guidance is intended to reduce diversity in practice regarding the classification of certain transactions in the statement of cash flows. This guidance is effective January 1, 2018 and requires a retrospective transition method. Early adoption is permitted. The Company currently classifies all cash outflows for contingent consideration as a financing activity. Upon adoption the Company is required to classify only the original estimated liability as a financing activity and any changes as an operating activity. In February 2016, the FASB issued ASU 2016-02, which amends the ASC and creates Topic 842, Leases. Topic 842 will require lessees to recognize right-to-use assets and lease liabilities for those leases classified as operating leases under previous U.S. GAAP on the balance sheet. This guidance is effective for annual periods beginning after December 15, 2018 and early adoption is permitted. While not yet in a position to assess the full impact of the application of the new standard, the Company expects that the impact of recording the lease liabilities and the corresponding right-to-use assets will have a significant impact on its total assets and liabilities with a minimal impact on equity. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Liabilities , which will require equity investments, except equity method investments, to be measured at fair value and any changes in fair value will be recognized in results of operations. This guidance is effective for annual and interim periods beginning after December 15, 2017 and early application is not permitted. Additionally, this guidance provides for the recognition of the cumulative effect of retrospective application of the new standard in the period of initial application. The Company does not expect the application of this guidance to have a significant impact on its consolidated financial position or results of operations. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2016 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | A subsidiary acquired in 2012 sponsors a defined benefit plan. The benefits under the defined benefit plan are based on each employee’s years of service and compensation. Effective March 1, 2006, the plan was frozen to all new employees. The Company’s policy is to contribute the minimum amount required by the Employee Retirement Income Security Act of 1974 (ERISA), as amended. The assets of the plan are invested in an investment trust fund and consist of investments in money market funds, bonds and common stock, mutual funds, preferred stock, and partnership interests. Net periodic pension cost consists of the following components for the years ended December 31: Pension Pension 2017 2016 Service cost $ — $ — Interest cost on benefit obligation 1,725 1,855 Expected return on plan assets (1,830 ) (1,863 ) Curtailment and settlements — 929 Amortization of actuarial losses 222 137 Net periodic benefit cost $ 117 $ 1,058 ASC 715-30-25 requires an employer to recognize the funded status of its defined pension benefit plan as a net asset or liability in its statement of financial position with an offsetting amount in accumulated other comprehensive income, and to recognize changes in that funded status in the year in which changes occur through comprehensive income. Other changes in plan assets and benefit obligation recognized in Other Comprehensive Loss consist of the following components for the years ended December 31: Pension Pension 2017 2016 Curtailment/settlement $ — $ — Current year actuarial (gain) loss 1,558 3,238 Amortization of actuarial gain (loss) (222 ) (137 ) Total recognized in other comprehensive (income) loss $ 1,336 $ 3,101 Total recognized in net periodic benefit cost and other comprehensive (income) loss $ 1,453 $ 4,159 The following table summarizes the change in benefit obligations and fair values of plan assets for the years ended December 31: 2017 2016 Change in benefit obligation: Benefit obligation, Beginning balance $ 40,722 $ 40,296 Interest Cost 1,725 1,855 Actuarial losses 3,088 2,502 Benefits paid (1,785 ) (3,931 ) Benefit obligation, Ending balance 43,750 40,722 Change in plan assets: Fair value of plan assets, Beginning balance 24,482 25,190 Actual return on plan assets 3,360 198 Employer contributions 1,920 3,025 Benefits paid (1,785 ) (3,931 ) Fair value of plan assets, Ending balance 27,977 24,482 Unfunded status $ 15,773 $ 16,240 Accumulated benefit obligation generally measures the value of benefits earned to date. Projected benefit obligation also includes the effect of assumed future compensation increases for plans in which benefits for prior service are affected by compensation changes. This pension plan has asset values less than these measures. Plan funding amounts are calculated pursuant to ERISA and Internal Revenue Code rules. Amounts recognized in the balance sheet at December 31 consist of the following: Pension Pension 2017 2016 Non-current liability $ 15,773 $ 16,240 Net amount recognized $ 15,773 $ 16,240 Amounts recognized, net of tax, in Accumulated Other Comprehensive Loss consists of the following components for the years ended December 31: Pension Pension 2017 2016 Accumulated net actuarial losses $ 13,656 $ 12,320 Amount recognized, net of tax $ 13,656 $ 12,320 The following weighted average assumptions were used to determine benefit obligations as of December 31: Pension Pension 2017 2016 Discount rate 3.83 % 4.32 % Rate of compensation increase N/A N/A The discount rate assumptions at December 31, 2017 and 2016 were determined independently. A yield curve was produced for a universe containing the majority of U.S.-issued AA-graded corporate bonds, all of which were non-callable (or callable with make-whole provisions). The discount rate was developed as the level equivalent rate that would produce the same present value as that using spot rates aligned with the projected benefit payments. The following weighted average assumptions were used to determine net periodic costs at December 31: Pension Pension 2017 2016 Discount rate 4.32 % 4.69 % Expected return on plan assets 7.40 % 7.40 % Rate of compensation increase N/A N/A The expected return on plan assets is a long-term assumption established by considering historical and anticipated returns of the asset classes invested in by the pension plan and the allocation strategy currently in place among those classes. Fair Value of Plan Assets The Defined Benefit plan assets fall into any of three fair value classifications as defined in the FASB ASC Topic 820, Fair Value Measurements. There are no Level 3 assets held by the plan. The fair value of the plan assets as of December 31 is as follows: December 31, 2017 Level 1 Level 2 Level 3 Asset Category: Money Market Fund – Short Term Investments $ 1,695 $ 1,695 $ — $ — Mutual Funds 26,282 26,282 — — Total $ 27,977 $ 27,977 $ — $ — December 31, 2016 Level 1 Level 2 Level 3 Asset Category: Money Market Fund – Short Term Investments $ 1,687 $ 1,687 $ — $ — Mutual Funds 22,795 22,795 — — Total $ 24,482 $ 24,482 $ — $ — The pension plans weighted-average asset allocation for the years ended December 31, 2017, and 2016 are as follows: Target Allocation Actual Allocation Actual Allocation 2017 2017 2016 Asset Category: Equity Securities 68.0 % 68.9 % 65.5 % Debt Securities 31.0 % 25.0 % 27.6 % Cash/Cash Equivalents and Short Term Investments 1.0 % 6.1 % 6.9 % 100 % 100 % 100 % The investment policy for the plans is formulated by the Company’s Pension Plan Committee (the “Committee”). The Committee is responsible for adopting and maintaining the investment policy, managing the investment of plan assets and ensuring that the plans’ investment program is in compliance with all provisions of ERISA, as well as the appointment of any investment manager who is responsible for implementing the plans’ investment process. The goals of the pension plan investment program are to fully fund the obligation to pay retirement benefits in accordance with the plan documents and to provide returns that, along with appropriate funding from the Company, maintain an asset/liability ratio that is in compliance with all applicable laws and regulations and assures timely payment of retirement benefits. The Company’s overall investment strategy is to achieve a mix of approximately 50% of investments for long-term growth and 50% for near-term benefit payments with a wide diversification of asset types and fund strategies. Equity securities primarily include investments in large-cap and mid-cap companies primarily located in the United States, as well as a smaller percentage invested in large-cap and mid-cap companies located outside of the United States. Fixed income securities are diversified across different asset types with bonds issued in the United States as well as outside the United States. The target allocation of plan assets is 50% equity securities and 50% corporate bonds and U.S. Treasury securities. The Plan invests in various investment securities. These investments are primarily in corporate equity and bond securities. Investment securities are exposed to various risks such as interest rate, market, and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the preceding tables. The above tables present information about the pension plan assets measured at fair value at December 31, 2017 and the valuation techniques used by the Company to determine those fair values. In general, fair values determined by Level 1 inputs use quoted prices in active markets for identical assets that the Plan has the ability to access. Fair values determined by Level 2 inputs use other inputs that are observable, either directly or indirectly. These Level 2 inputs include quoted prices for similar assets in active markets, and other inputs such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs, including inputs that are available in situations where there is little, if any, market activity for the related asset. In instances where inputs used to measure fair value fall into different levels in the above fair value hierarchy, fair value measurements in their entirety are categorized based on the lowest level input that is significant to the valuation. The Company’s assessment of the significance of particular inputs to these fair value measurements requires judgment and considers factors specific to each plan asset. The net of investment manager fee asset return objective is to achieve a return earned by passively managed market index funds, weighted in the proportions identified in the strategic asset allocation matrix. Each investment manager is expected to perform in the top one-third of funds having similar objectives over a full market cycle. The investment policy is reviewed by the Committee at least annually and confirmed or amended as needed. Under ASC 715-30-25, the transition obligation, prior service costs, and actuarial (gains)/losses are recognized in Accumulated Other Comprehensive Income each December 31 or any interim measurement date, while amortization of these amounts through net periodic benefit cost will occur in accordance with ASC 715-30 and ASC 715-60. The estimated amounts that will be amortized in 2018 are as follows: Pension Estimated Amortization: 2018 Net loss amortization 258 Total $ 258 The following estimated benefit payments, which reflect expected future service, as appropriate, are expected to be paid in the years ending December 31: Period Amount 2018 $ 1,806 2019 1,903 2020 2,090 2021 2,077 2022 2,109 2023 – 2027 12,010 The pension plan contributions are deposited into a trust, and the pension plan benefit payments are made from trust assets. |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Changes in Accumulated Other Comprehensive Income (Loss) | . Changes in Accumulated Other Comprehensive Income (Loss) The changes in accumulated other comprehensive income (loss) for the year ended December 31 were: Defined Foreign Currency Translation Total Balance December 31, 2015 $ (9,219 ) $ 15,476 $ 6,257 Other comprehensive income before reclassifications — (4,980 ) (4,980 ) Amounts reclassified from accumulated other comprehensive income (loss) (3,101 ) — (3,101 ) Other comprehensive income (loss) $ (3,101 ) $ (4,980 ) $ (8,081 ) Balance December 31, 2016 $ (12,320 ) $ 10,496 $ (1,824 ) Other comprehensive income before reclassifications $ — $ 1,206 $ 1,206 Amounts reclassified from accumulated other comprehensive income (loss) (net of tax benefit of $528) (1,336 ) — (1,336 ) Other comprehensive income (loss) (1,336 ) 1,206 (130 ) Balance December 31, 2017 $ (13,656 ) $ 11,702 $ (1,954 ) Reclassifications for the years ended December 31, net of tax, were as follows: 2017 2016 Current year actuarial (gain) loss $ 1,558 $ 3,238 Amortization of actuarial gain (loss) (222 ) (137 ) Total amount reclassified from accumulated other comprehensive income (loss), net of tax $ 1,336 $ 3,101 |
Quarterly Results of Operations
Quarterly Results of Operations (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Results of Operations (Unaudited) | Quarterly Results of Operations (Unaudited) The following table sets forth a summary of the Company’s consolidated unaudited quarterly results of operations for the years ended December 31, in thousands of dollars, except per share amounts. Quarters First Second Third Fourth Revenue: 2017 $ 344,700 $ 390,532 $ 375,800 $ 402,747 2016 $ 309,042 $ 337,047 $ 349,254 $ 390,442 Cost of services sold: 2017 $ 237,563 $ 267,822 $ 249,418 $ 268,673 2016 $ 211,446 $ 228,835 $ 235,659 $ 260,193 Income (loss) from continuing operations: 2017 $ (9,683 ) $ 13,467 $ 21,984 $ 231,455 2016 $ (22,773 ) $ 2,089 $ (31,081 ) $ 11,144 Net income (loss) attributable to MDC Partners Inc.: 2017 $ (10,566 ) $ 11,253 $ 18,493 $ 222,668 2016 $ (23,632 ) $ 835 $ (32,140 ) $ 9,098 Income (loss) per common share: Basic Continuing operations: 2017 $ (0.21 ) $ 0.14 $ 0.25 $ 3.33 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 Net income (loss): 2017 $ (0.21 ) $ 0.14 $ 0.25 $ 3.33 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 Diluted Continuing operations: 2017 $ (0.21 ) $ 0.14 $ 0.24 $ 3.30 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 (1) Net income (loss): 2017 $ (0.21 ) $ 0.14 $ 0.24 $ 3.30 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 (1) (1) The diluted income per share calculation for the fourth quarter of 2016 excludes the Company’s option to settle the deferred acquisition consideration in shares related to F&B. If such shares were included, the diluted income per common share would be $0.14 . The above revenue, cost of services sold, and income (loss) from continuing operations have primarily been affected by acquisitions, divestitures and discontinued operations. Historically, with some exceptions, the Company’s fourth quarter generates the highest quarterly revenues in a year. The fourth quarter has historically been the period in the year in which the highest volumes of media placements and retail related consumer marketing occur. Income (loss) from continuing operations and net loss have been affected as follows: • The fourth quarter of 2017 and 2016 included a foreign exchange loss of $659 and $10,081 , respectively. • The fourth quarter of 2017 and 2016 included stock-based compensation charges of $7,480 and $5,560 , respectively. • The fourth quarter of 2017 and 2016 included changes in deferred acquisition resulting in income of $18,173 and $9,211 , respectively. • The fourth quarter of 2017 included goodwill and other asset impairment charges of $4,415 and the third and fourth quarter of 2016 included goodwill impairment charges of $29,631 and $18,893 , respectively. • The fourth quarter of 2017 included income tax benefit related to the release of the Company’s valuation allowance of $226,466 . The fourth quarter of 2016 included income tax expense of $925 relating to the increase to the valuation allowance. |
VALUATION AND QUALIFYING ACCOUN
VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2014 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS For the Three Years Ended December 31, (Dollars in Thousands) Column A Column B Column C Column D Column E Column F Description Balance at Charged to Removal of Uncollectible Receivables Translation Adjustments Balance at Valuation accounts deducted from assets to which they apply – allowance for doubtful accounts: December 31, 2017 $ 1,523 $ 1,989 $ (924 ) $ (135 ) $ 2,453 December 31, 2016 $ 1,306 $ 1,053 $ (830 ) $ (6 ) $ 1,523 December 31, 2015 $ 1,409 $ 750 $ (799 ) $ (54 ) $ 1,306 Schedule II — 2 of 2 MDC PARTNERS INC. & SUBSIDIARIES SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS For the Three Years Ended December 31, (Dollars in Thousands) Column A Column B Column C Column D Column E Column F Description Balance at Charged to Other (1) Translation Adjustments Balance at Valuation accounts deducted from assets to which they apply – valuation allowance for deferred income taxes: December 31, 2017 $ 248,867 $ (230,358 ) $ 4,108 $ (3,585 ) $ 19,032 December 31, 2016 $ 247,967 $ 6,605 $ (6,032 ) $ 327 $ 248,867 December 31, 2015 $ 175,218 $ 3,565 $ 73,390 $ (4,206 ) $ 247,967 ____________ (1) Adjustment to reconcile actual net operating loss carry forwards to prior year tax accrued, utilization of net operating loss carry forwards, which were fully reserved, adjustment for net operating loss relating to sale of business and pension plan adjustment. (b) Exhibits The exhibits listed on the accompanying Exhibits Index are filed as a part of this report. |
Other Events (Notes)
Other Events (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Other Events [Abstract] | |
Other Events [Text Block] | 21. Other Events None. |
Subsequent Events Subsequent Ev
Subsequent Events Subsequent Events (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | 22. Subsequent Events None. |
Significant Accounting Polici31
Significant Accounting Policies (Policies) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | ||
Accounting Changes [Text Block] | : | |
Subsidiary and Equity Investment Stock Transaction, Policy [Policy Text Block] | Subsidiary and Equity Investment Stock Transactions. Transactions involving the purchase, sale or issuance of stock of a subsidiary where control is maintained are recorded as a reduction in the redeemable noncontrolling interests or noncontrolling interests, as applicable. Any difference between the purchase price and noncontrolling interest is recorded to additional paid-in capital. In circumstances where the purchase of shares of an equity investment results in obtaining control, the existing carrying value of the investment is remeasured to the acquisition date fair value and any gain or loss is recognized in results of operations. | |
Consolidation | Principles of Consolidation . The accompanying consolidated financial statements include the accounts of MDC Partners Inc. and its domestic and international controlled subsidiaries that are not considered variable interest entities, and variable interest entities for which the Company is the primary beneficiary. Intercompany balances and transactions have been eliminated in consolidation. | |
Reclassifications [Text Block] | Reclassifications. Certain reclassifications have been made to the prior period financial statements to conform to the current period presentation. | |
Use of Estimates | Use of Estimates . The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities including goodwill, intangible assets, contingent deferred acquisition consideration, valuation allowances for receivables, deferred tax assets and the amounts of revenue and expenses reported during the period. These estimates are evaluated on an ongoing basis and are based on historical experience, current conditions and various other assumptions believed to be reasonable under the circumstances. Actual results could differ from these estimates. | |
Fair Value Measurement | Fair Value . The Company applies the fair value measurement guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “ASC”) Topic 820, Fair Value Measurements, for financial assets and liabilities that are required to be measured at fair value and for non-financial assets and liabilities that are not required to be measured at fair value on a recurring basis, including goodwill and other identifiable intangible assets. The measurement of fair value requires the use of techniques based on observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The inputs create the following fair value hierarchy: • Level 1 - Quoted prices for identical instruments in active markets. • Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations where inputs are observable or where significant value drivers are observable. • Level 3 - Instruments where significant value drivers are unobservable to third parties. When available, the Company uses quoted market prices to determine the fair value of its financial instruments and classifies such items in Level 1. In some cases, quoted market prices are used for similar instruments in active markets and the Company classifies such items in Level 2. | |
Concentration Risk, Credit Risk | Concentration of Credit Risk . The Company provides marketing communications services to clients who operate in most industry sectors. Credit is granted to qualified clients in the ordinary course of business. Due to the diversified nature of the Company’s client base, the Company does not believe that it is exposed to a concentration of credit risk. No client accounted for more than 10% of the Company’s consolidated accounts receivable as of December 31, 2017 and 2016 . No clients accounted for 10% of the Company’s revenue in each of the years ended December 31, 2017 , 2016 , and 2015 . | |
Cash and Cash Equivalents | Cash and Cash Equivalents . The Company’s cash equivalents are primarily comprised of investments in overnight interest-bearing deposits, commercial paper and money market instruments and other short-term investments with original maturity dates of three months or less at the time of purchase. The Company has a concentration of credit risk in that there are cash deposits in excess of federally insured amounts. | |
Cash in Trust, Policy [Policy Text Block] | Cash in Trust. A subsidiary of the Company holds restricted cash in trust accounts related to funds received on behalf of clients. Such amounts are held in escrow under depositary service agreements and distributed at the direction of the clients. The funds are presented as a corresponding liability on the balance sheet. | |
Premiums Receivable, Allowance for Doubtful Accounts, Estimation Methodology | Allowance for Doubtful Accounts . Trade receivables are stated at invoiced amounts less allowances for doubtful accounts. The allowances represent estimated uncollectible receivables associated with potential customer defaults usually due to customers’ potential insolvency. The allowances include amounts for certain customers where a risk of default has been specifically identified. The assessment of the likelihood of customer defaults is based on various factors, including the length of time the receivables are past due, historical experience and existing economic conditions. | |
Expenditures Billable To Clients | Expenditures Billable to Clients . Expenditures billable to clients consist principally of outside vendor costs incurred on behalf of clients when providing advertising, marketing and corporate communications services that have not yet been invoiced to clients. Such amounts are invoiced to clients at various times over the course of the production process. | |
Property, Plant and Equipment | Fixed Assets . Fixed assets are stated at cost, net of accumulated depreciation. Computers, furniture and fixtures are depreciated on a straight-line basis over periods of three to seven years. Leasehold improvements are depreciated on a straight-line basis over the lesser of the term of the related lease or the estimated useful life of the asset. Repairs and maintenance costs are expensed as incurred. | |
Impairment Of Long Lived Assets | Impairment of Long-lived Assets . In accordance with the FASB ASC, a long-lived asset or asset group is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. When such events occur, the Company compares the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group to the carrying amount of such asset or asset group. If this comparison indicates that there is an impairment, the amount of the impairment is typically calculated using discounted expected future cash flows where observable fair values are not readily determinable. The discount rate applied to these cash flows is based on the Company’s weighted average cost of capital (“WACC”), risk adjusted where appropriate. | |
Equity Method Investments | Equity Method Investments . The equity method is used to account for investments in entities in which the Company has an ownership interest of less than 50% and has significant influence, or joint control by contractual arrangement, (i) over the operating and financial policies of the affiliate or (ii) has an ownership interest greater than 50% ; however, the substantive participating rights of the noncontrolling interest shareholders preclude the Company from exercising unilateral control over the operating and financial policies of the affiliate. The Company’s investments that were accounted for using the equity method include various interests in investment funds. The Company’s management periodically evaluates these investments to determine if there has been a decline in value that is other than temporary. These investments are included in investments in non-consolidated affiliates. During the year ended December 31, 2016 , the Company sold its ownership in two of these equity method investments for $4,023 and recognized a gain of $623 in Other income. | |
Cost Method Investments | Cost Method Investments . From time to time, the Company makes non-material cost based investments in start-up advertising technology companies and innovative consumer product companies where the Company does not exercise significant influence over the operating and financial policies of the investee. The total net cost basis of these investments, which is included in Other Assets on the balance sheet, as of December 31, 2017 and 2016 was $9,527 and $10,132 , respectively. These investments are periodically evaluated to determine whether a significant event or change in circumstances has occurred that may impact the fair value of each investment other than temporary declines below book value. A variety of factors are considered when determining if a decline is other than temporary, including, among others, the financial condition and prospects of the investee, as well as the Company’s investment intent. During the year ended December 31, 2017 , the Company sold its ownership in three of these cost method investments for an aggregate purchase price of $3,557 and recognized a gain of $3,018 in Other income. In addition, the Company recognized a loss of $935 pertaining to the dissolution of five of these cost method investments. During the year ended December 31, 2016 , the Company sold its ownership in three of these cost method investments for an aggregate purchase price of $4,074 and recognized a gain of $1,309 in Other income. In addition, the Company’s partner agencies may receive noncontrolling equity interests from start-up companies in lieu of fees. These types of arrangements were not significant to the Company’s financial statements for the three years ended December 31, 2017. | |
Goodwill and Intangible Assets, Goodwill | Goodwill and Indefinite Lived Intangibles . In accordance with the FASB ASC topic, Goodwill and Other Intangible Assets, goodwill and indefinite life intangible assets (trademarks) acquired as a result of a business combination which are not subject to amortization are tested for impairment annually as of October 1st of each year, or more frequently if indicators of potential impairment exist. For goodwill, impairment is assessed at the reporting unit level. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment, which eliminates step two from the two-step goodwill impairment test. Under the new guidance, an entity will perform its goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value provided the loss recognized does not exceed the total amount of goodwill allocated to that reporting unit. This guidance is effective for annual or interim goodwill impairment tests performed in fiscal years beginning after December 15, 2019. The Company has early adopted this guidance for its impairment test performed in 2017. For the annual impairment testing the Company has the option of assessing qualitative factors to determine whether it is more likely than not that the carrying amount of a reporting unit exceeds its fair value or performing a quantitative goodwill impairment test. Qualitative factors considered in the assessment include industry and market considerations, the competitive environment, overall financial performance, changing cost factors such as labor costs, and other factors specific to each reporting unit such as change in management or key personnel. If the Company elects to perform the qualitative assessment and concludes that it is more likely than not that the fair value of the reporting unit is more than its carrying amount, then goodwill is not considered impaired and the quantitative impairment test is not necessary. For reporting units for which the qualitative assessment concludes that it is more likely than not that the fair value of the reporting unit is less than its carrying amount and for reporting units for which the qualitative assessment is not performed, the Company will perform the quantitative impairment test, which compares the fair value of the reporting unit to its carrying amount. If the fair value of the reporting unit exceeds the carrying amount of the net assets assigned to that reporting unit, goodwill is not considered impaired. However, if the carrying amount of the net assets assigned to the reporting unit then the recognition of an impairment charge is required. Determining the fair value of a reporting unit involves the use of significant estimates and assumptions. For the 2017 annual impairment test, the Company used a combination of the income approach, which incorporates the use of the discounted cash flow (“DCF”) method, and the market approach, which incorporates the use of earnings and revenue multiples based on market data. The Company generally applied an equal weighting to the income and market approaches for the impairment test. The income approach and the market approach both require the exercise of significant judgment, including judgment about the amount and timing of expected future cash flows, assumed terminal value and appropriate discount rates. The DCF estimates incorporate expected cash flows that represent a spectrum of the amount and timing of possible cash flows of each reporting unit from a market participant perspective. The expected cash flows are developed as part of the Company’s routine long-range planning process using projections of revenue and expenses and related cash flows based on assumed long-term growth rates and demand trends and appropriate discount rates based on a reporting units WACC as determined by considering the observable WACC of comparable companies and factors specific to the reporting unit (for example, size). The terminal value is estimated using a constant growth method which requires an assumption about the expected long-term growth rate. The estimates are based on historical data and experience, industry projections, economic conditions, and the Company’s expectations. The assumptions used for the long-term growth rate and WACC in the annual goodwill impairment tests are as follows: October 1, 2017 Long-term growth rate 3% WACC 9.67% - 11.85% The Company’s reporting units vary in size with respect to revenue and operating profits. These differences drive variations in fair value of the reporting units. In addition, these differences as well as differences in book value, including goodwill, cause variations in the amount by which fair value exceeds the carrying amount of the reporting units. The reporting unit goodwill balances vary by reporting unit primarily because it relates specifically to the Partner Firm’s goodwill which was determined at the date of acquisition. For the 2017 annual goodwill impairment test, the Company had 32 reporting units, all of which were subject to the quantitative goodwill impairment test and the carrying amount of two of the Company’s reporting units exceeded their fair value, resulting in a partial impairment of goodwill of $3,238 . The fair value of all other reporting units were in excess of their respective carrying amounts and as a result there was no additional impairment of goodwill. The range of the excess of fair value over the carrying amount for the Company’s reporting units was from 12% to over 100% . The Company performed a sensitivity analysis which included a 1% increase to the WACC. Based on the results of that analysis, no additional reporting units were at risk of failing the quantitative impairment test. In addition, a reporting unit within the Domestic Creative Agencies segment to which $14,853 of goodwill is allocated had a negative carrying amount on December 31, 2017. The Company believes the estimates and assumptions used in the calculations are reasonable. However, if there was an adverse change in the facts and circumstances, then an impairment charge may be necessary in the future. The Company will monitor its reporting units to determine if there is an indicator of potential impairment. Should the fair value of any of the Company’s reporting units fall below its carrying amount because of reduced operating performance, market declines, changes in the discount rate, or other conditions, charges for impairment may be necessary. Subsequent to the annual impairment test at October 1, 2017 , there were no events or circumstances that triggered the need for an interim impairment test. Prior to the adoption of ASU 2017-04, the Company’s impairment tests used the income approach to estimate a reporting unit’s fair value. The income approach requires the exercise of significant judgment, including judgment about the amount and timing of expected future cash flows, assumed terminal value and appropriate discount rates. The Company’s quantitative impairment tests included two-steps. The first step compared the fair value of each reporting unit to their respective carrying amounts. If the fair value of the reporting unit exceeded the carrying amount of the net assets assigned to that reporting unit, goodwill was not considered impaired and additional analysis was not required. However, if the carrying amount of the net assets assigned to the reporting unit exceeded the fair value of the reporting unit, then the second step of the goodwill impairment test was performed to determine the implied fair value of the reporting unit’s goodwill. Under the second step of the goodwill impairment test, the Company utilized both a market approach and income approach to estimate the implied fair value of a reporting unit’s goodwill. For the market approach, the Company utilized both the guideline public company method and the precedent transaction method. For the income approach, the Company utilized a DCF method. The Company weighted the market and income approaches to arrive at an implied fair value of goodwill. If the Company determined that the carrying amount of a reporting unit’s goodwill exceeded its implied fair value, an impairment loss equal to the difference was recorded. During the third quarter of 2016, there was a change to the Company’s reporting units. This change, coupled with a decline in operating performance required the Company to perform interim goodwill testing on one of its experiential reporting units. Additionally, a triggering event occurred during the third quarter of 2016 that required the Company to perform interim goodwill testing on one non-material reporting unit. This interim impairment analysis resulted in a partial impairment of goodwill of $27,893 and $1,738 relating to the experiential reporting unit and non-material reporting unit, respectively. For the 2016 annual impairment test, a partial impairment of goodwill of $18,893 in one of the Company’s strategic communications reporting units. The fair value for all other reporting units were in excess of their respective carrying amounts and as a result there was no additional impairment of goodwill. In addition, a reporting unit within the All Other segment to which $5,479 of goodwill is allocated had a negative carrying amount on December 31, 2016. Indefinite-lived intangible assets are primarily evaluated on an annual basis, generally in conjunction with the Company’s evaluation of goodwill balances. There were no impairment indicators as of December 31, 2017. | |
Intangible Assets, Finite-Lived | Definite Lived Intangible Assets . In accordance with the FASB ASC, acquired intangibles are subject to amortization over their useful lives. The method of amortization selected reflects the pattern in which the economic benefits of the specific intangible asset is consumed or otherwise used up. If that pattern cannot be reliably determined, a straight-line amortization method is used over the estimated useful life. Intangible assets that are subject to amortization are reviewed for potential impairment at least annually or whenever events or circumstances indicate that carrying amounts may not be recoverable. See Note 8 | |
Deferred Taxes | Deferred Taxes . The Company uses the asset and liability method of accounting for income taxes. Deferred income taxes are provided for the temporary difference between the financial reporting basis and tax basis of the Company’s assets and liabilities. Deferred tax benefits result primarily from certain tax carryover benefits, from recording certain expenses in the financial statements that are not currently deductible for tax purposes and from differences between the tax and book basis of assets and liabilities recorded in connection with acquisitions. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax liabilities result primarily from deductions recorded for tax purposes in excess of that recorded in the financial statements or income for financial statement purposes in excess of the amount for tax purposes. The effect of changes in tax rates is recognized in the period the rate change is enacted. | |
Business Combinations | Business Combinations. Business combinations are accounted for using the acquisition method and accordingly, the assets acquired (including identified intangible assets), the liabilities assumed and any noncontrolling interest in the acquired business are recorded at their acquisition date fair values. The Company’s acquisition model typically provides for an initial payment at closing and for future additional contingent purchase price obligations. Contingent purchase price obligations are recorded as deferred acquisition consideration on the balance sheet at the acquisition date fair value and are remeasured at each reporting period. Changes in such estimated values are recorded in the results of operations. For the years ended December 31, 2017 , 2016 and 2015 , operating income of $4,896 , and operating expense of $7,972 and $36,344 , respectively, was recorded pertaining to changes in the estimated value. For further information, see Note 4 and Note 13 of the Notes to the Consolidated Financial Statements included herein. For the years ended December 31, 2017 , 2016 , and 2015 , $877 , $2,640 and $2,912 , respectively, of acquisition related costs were charged to operations. For each acquisition, the Company undertakes a detailed review to identify other intangible assets and a valuation is performed for all such identified assets. The Company uses several market participant measurements to determine estimated value. This approach includes consideration of similar and recent transactions, as well as utilizing discounted expected cash flow methodologies. A substantial portion of the intangible asset value that the Company acquires is the specialized know-how of the workforce, which is treated as part of goodwill and is not required to be valued separately. The majority of the value of the identifiable intangible assets acquired is derived from customer relationships, including the related customer contracts, as well as trade names. In executing the Company’s overall acquisition strategy, one of the primary drivers in identifying and executing a specific transaction is the existence of, or the ability to, expand the existing client relationships. The expected benefits of the Company’s acquisitions are typically shared across multiple agencies and regions. | |
Redeemable Noncontrolling Interest | Redeemable Noncontrolling Interests . Many of the Company’s acquisitions include contractual arrangements where the noncontrolling shareholders have an option to purchase, or may require the Company to purchase, such noncontrolling shareholders’ incremental ownership interests under certain circumstances and the Company has similar call options under the same contractual terms. The amount of consideration under these contractual arrangements is not a fixed amount, but rather is dependent upon various valuation formulas as described in Note 17 of the Notes to the Consolidated Financial Statements included herein. In the event that an incremental purchase may be required of the Company, the amounts are recorded as redeemable noncontrolling interests in mezzanine equity on the balance sheet at their acquisition date fair value and adjusted for changes to their estimated redemption value through additional paid-in capital (but not less than their initial redemption value), except for foreign currency translation adjustments. These adjustments will not impact the calculation of earnings (loss) per share if the redemption values are less than the estimated fair values. For the three years ended December 31, 2017 , 2016 , and 2015 , there was no impact on the Company’s earnings (loss) per share calculation. | |
Variable Interest Entity | Variable Interest Entity . Effective March 28, 2012, the Company invested in Doner Partners LLC (“Doner”). The Company acquired a 30% voting interest and convertible preferred interests that allow the Company to increase ordinary voting ownership to 70% at the Company’s option. Effective April 1, 2017, the Company acquired an additional 15% voting and convertible preferred interest that allowed the Company to increase ordinary voting ownership to 85% at the Company’s option. The Company now has a 65% voting interest. The Company has determined that (i) this entity is a variable interest entity and (ii) the Company is the primary beneficiary because it receives a disproportionate share of profits and losses as compared to its ownership percentage. As such, Doner is consolidated for all periods subsequent to the date of investment. Doner is a full service integrated creative agency that is included as part of the Company’s portfolio in the Global Integrated Agencies segment. The Company’s Credit Agreement (see Note 10) is guaranteed and secured by all of Doner’s assets. Total assets and total liabilities of Doner included in the Company’s consolidated balance sheet at December 31, 2017 and 2016 , were $105,191 and $59,783 , and $102,456 and $57,622 , respectively. | |
Guarantees, Indemnifications and Warranties | Guarantees . Guarantees issued or modified by the Company to third parties after January 1, 2003 are generally recognized, at the inception or modification of the guarantee, as a liability for the obligations it has undertaken in issuing the guarantee, including its ongoing obligation to stand ready to perform over the term of the guarantee in the event that the specified triggering events or conditions occur. The initial measurement of that liability is the fair value of the guarantee. The recognition of the liability is required even if it is not probable that payments will be required under the guarantee. The Company’s liability associated with guarantees is not significant. | |
Revenue Recognition | Revenue Recognition . The Company’s revenue recognition policies are established in accordance with the Revenue Recognition topics of the FASB ASC, and accordingly, revenue is recognized when all of the following criteria are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the selling price is fixed or determinable; (iii) services have been performed or upon delivery of the products when ownership and risk of loss has transferred to the client; and (iv) collection of the resulting receivable is reasonably assured. The Company follows the Multiple-Element Arrangement topic of the FASB ASC, which addresses certain aspects of the accounting by a vendor for arrangements under which it will perform multiple revenue-generating activities and how to determine whether an arrangement involving multiple deliverables contains more than one unit of accounting. The Company follows the Principal Agent Consideration topic of the FASB ASC which addresses (i) whether revenue should be recorded at the gross amount billed because it has earned revenue from the sale of goods or services, or recorded at the net amount retained because it has earned a fee or commission, and (ii) that reimbursements received for out-of-pocket expenses incurred should be characterized in the income statement as revenue. Accordingly, the Company has included such reimbursed expenses in revenue. The Company earns revenue from agency arrangements in the form of retainer fees or commissions; from short-term project arrangements in the form of fixed fees or per diem fees for services; and from incentives or bonuses. Non-refundable retainer fees are generally recognized on a straight-line basis over the term of the specific customer arrangement. Commission revenue is earned and recognized upon the placement of advertisements in various media when the Company has no further performance obligations. Fixed fees for services are recognized upon completion of the earnings process and acceptance by the client. Per diem fees are recognized upon the performance of the Company’s services. In addition, for a limited number of certain service transactions, which require delivery of a number of service acts, the Company uses the proportional performance model, which generally results in revenue being recognized based on the straight-line method. For arrangements with customers for which the Company earns a fixed fee for development of customized mobile applications (“Apps”), revenue is recognized in accordance with the accounting guidance contained in ASC 605-35 and is primarily recognized using the proportional performance method of accounting. Performance is generally measured based upon the efforts incurred to date in relation to total estimated efforts to the completion of the contract. Fees billed to clients in excess of fees recognized as revenue are classified as advanced billings on the Company’s balance sheet. A small portion of the Company’s contractual arrangements with customers includes performance incentive provisions, which allow the Company to earn additional revenue as a result of its performance relative to both quantitative and qualitative goals. The Company recognizes the incentive portion of revenue under these arrangements when specific quantitative goals are assured, or when the Company’s clients determine performance against qualitative goals has been achieved. In all circumstances, revenue is only recognized when collection is reasonably assured. The Company records revenue net of sales and other taxes due to be collected and remitted to governmental authorities. | |
Cost Of Services Sold | Cost of Services Sold . Cost of services sold primarily consists of staff costs, and does not include depreciation charges for fixed assets. | |
Interest Expense | Interest Expense . Interest expense primarily consists of the cost of borrowing on the Company’s previously outstanding 6.75% Senior Notes due 2020 (the “6.75% Notes”); the Company’s currently outstanding 6.50% senior unsecured notes due 2024 (the “6.50% Notes”); and the Company’s $325,000 senior secured revolving credit agreement due 2021 (the “Credit Agreement”). The Company uses the effective interest method to amortize the deferred financing costs on the 6.75% Notes, the 6.50% Notes as well as the original issue premium on the previously outstanding 6.75% Notes. The Company also uses the straight-line method to amortize the deferred financing costs on the Credit Agreement. For the years ended December 31, 2017 , 2016 , and 2015 , interest expense included $100 , $255 , and $2,543 , respectively, relating to present value adjustments for fixed deferred acquisition consideration payments. | |
Share-based Compensation, Option and Incentive Plans | Stock-Based Compensation . Under the fair value method, compensation cost is measured at fair value at the date of grant and is expensed over the service period, in this case the award’s vesting period. The Company recognizes forfeitures as they occur. When awards are exercised, share capital is credited by the sum of the consideration paid together with the related portion previously credited to additional paid-in capital when compensation costs were charged against income or acquisition consideration. The Company uses its historical volatility derived over the expected term of the award to determine the volatility factor used in determining the fair value of the award. Stock-based awards that are settled in cash, or may be settled in cash at the option of employees, are recorded as liabilities. The measurement of the liability and compensation cost for these awards is based on the fair value of the award, and is recorded in operating income over the service period, in this case the award’s vesting period. Changes in the Company’s payment obligation prior to the settlement date of a stock-based award are recorded as compensation cost in operating income in the period of the change. The final payment amount for such awards is established on the date of the exercise of the award by the employee. Stock-based awards that are settled in cash or equity at the option of the Company are recorded at fair value on the date of grant and recorded as additional paid-in capital. The fair value measurement of the compensation cost for these awards is based on using the Black-Scholes option pricing-model and is recorded in operating income over the service period, in this case the award’s vesting period. It is the Company’s policy for issuing shares upon the exercise and/or vesting of an equity incentive award to verify the amount of shares to be issued, as well as the amount of proceeds to be collected (if any) and to deliver new shares to the exercising party. The Company has adopted the straight-line attribution method for determining the compensation cost to be recorded during each accounting period. The Company commences recording compensation expense related to awards that are based on performance conditions under the straight-line attribution method when it is probable that such performance conditions will be met. The Company treats benefits paid by shareholders or equity members to employees as a stock-based compensation charge with a corresponding credit to additional paid-in capital. From time to time, certain acquisitions and step-up transactions include an element of compensation related payments. The Company accounts for those payments as stock-based compensation. | |
Pension and Other Postretirement Plans | Pension Costs . Several of the Company’s U.S. and Canadian subsidiaries offer employees access to certain defined contribution pension programs. Under the defined contribution plans, these subsidiaries, in some cases, make annual contributions to participants’ accounts which are subject to vesting. The Company’s contribution expense pursuant to these plans was $10,124 , $10,026 and $6,731 for the years ended December 31, 2017 , 2016 , and 2015 , respectively. The Company also has a defined benefit plan. See Note 19 | |
Earnings Per Share | Income (Loss) per Common Share . Basic income (loss) per common share is based upon the weighted average number of common shares outstanding during each period. Share capital to be issued as reflected in the shareholders’ deficit on the balance sheet, are also included if there is no circumstance under which those shares would not be issued. Diluted income (loss) per common share is based on the above, in addition, if dilutive, common share equivalents, which include outstanding options, stock appreciation rights, and unvested restricted stock units. | |
Foreign Currency Transactions and Translations | Foreign Currency Translation . The Company’s financial statements were prepared in accordance with the requirements of FASB ASC Topic 830 Foreign Currency Matters. The functional currency of the Company is the Canadian dollar and it has decided to use U.S. dollars as its reporting currency for consolidated reporting purposes. Generally, the Company’s subsidiaries use their local currency as their functional currency. Accordingly, the currency impacts of the translation of the balance sheets of the Company and its non-U.S. dollar based subsidiaries to U.S. dollar statements are included as cumulative translation adjustments in accumulated other comprehensive income. Translation of intercompany debt, which is not intended to be repaid, is included in cumulative translation adjustments. Cumulative translation adjustments are not included in net earnings unless they are actually realized through a sale or upon complete, or substantially complete, liquidation of the Company’s net investment in the foreign operation. Translation of current intercompany balances are included in net earnings. The balance sheets of non-U.S. dollar based subsidiaries are translated at the period end rate. The income statements of the Company and its non-U.S. dollar based subsidiaries are translated at average exchange rates for the period. Gains and losses arising from the Company’s foreign currency transactions are reflected in net earnings. Unrealized gains or losses arising on the translation of certain intercompany foreign currency transactions that are of a long-term nature (that is settlement is not planned or anticipated in the future) are included as cumulative translation adjustments in accumulated other comprehensive loss. | |
Derivatives, Reporting of Derivative Activity | Derivative Financial Instruments . The Company follows the Accounting for Derivative Instruments and Hedging Activities topic of the FASB ASC, which establishes accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts and debt instruments) be recorded on the balance sheet as either an asset or liability measured at its fair value. The accounting for the change in fair value of the derivative depends on whether the instrument qualifies for and has been designated as a hedging relationship and on the type of hedging relationship. There are three types of hedging relationships: (i) a cash flow hedge, (ii) a fair value hedge, and (iii) a hedge of foreign currency exposure of a net investment in a foreign operation. The designation is based upon the exposure being hedged. Derivatives that are not hedges, or become ineffective hedges, must be adjusted to fair value through earnings. |
Significant Accounting Polici32
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Redeemable Noncontrolling Interest | The following table presents changes in redeemable noncontrolling interests: Years Ended December 31, 2017 2016 2015 Beginning Balance as of January 1, $ 60,180 $ 69,471 $ 194,951 Redemptions (910 ) (1,708 ) (155,042 ) Granted 1,666 2,274 7,703 Changes in redemption value 1,498 (9,604 ) 22,809 Currency translation adjustments 452 (253 ) (950 ) Ending Balance as of December 31, $ 62,886 $ 60,180 $ 69,471 |
Loss per Common Share (Tables)
Loss per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table sets forth the computation of basic and diluted income (loss) per common share from continuing operations for the years ended December 31: 2017 2016 2015 Numerator: Income (loss) from continuing operations $ 257,223 $ (40,621 ) $ (20,119 ) Net income attributable to the noncontrolling interests (15,375 ) (5,218 ) (9,054 ) Net income (loss) from continuing operations attributable to MDC Partners Inc. $ 241,848 $ (45,839 ) $ (29,173 ) Accretion on convertible preference shares (6,352 ) — — Net income allocated to convertible preference shares (29,902 ) — — Net income (loss) from continuing operations attributable to MDC Partners Inc. common shareholders 205,594 (45,839 ) (29,173 ) Effect of dilutive securities: Adjustment to net income allocated to convertible preference shares 106 — — Net income (loss) from continuing operations attributable to MDC Partners Inc. common shareholders $ 205,700 $ (45,839 ) $ (29,173 ) Denominator: Basic weighted average number of common shares outstanding 55,255,797 51,345,807 49,875,282 Effect of dilutive securities: Impact of stock options and non-vested stock under employee stock incentive plans 225,989 — — Diluted weighted average number of common shares outstanding 55,481,786 51,345,807 49,875,282 Net income (loss) from continuing operations attributable to MDC Partners Inc common shareholders per common share: Basic $ 3.72 $ (0.89 ) $ (0.58 ) Diluted $ 3.71 $ (0.89 ) $ (0.58 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Business Combinations [Abstract] | ||
Business Acquisition, Pro Forma Information [Table Text Block] | ||
Schedule of Net Income (Loss) Attributable to Parent and Transfers to and from Noncontrolling Interest | Changes in the Company’s ownership interests in our less than 100% owned subsidiaries during the three years ended December 31, were as follows: Net Income (Loss) Attributable to MDC Partners Inc. and Transfers (to) from the Noncontrolling Interests Year Ended December 31, 2017 2016 2015 Net income (loss) attributable to MDC Partners Inc. $ 241,848 $ (45,839 ) $ (35,454 ) Transfers (to) from the noncontrolling interests Increase (decrease) in MDC Partners Inc. paid-in capital for purchase of equity interests in excess of noncontrolling interests and redeemable noncontrolling interests 2,315 22,776 (42,780 ) Net transfers (to) from noncontrolling interests $ 2,315 $ 22,776 $ (42,780 ) Change from net income (loss) attributable to MDC Partners Inc. and transfers (to) from noncontrolling interests $ 244,163 $ (23,063 ) $ (78,234 ) |
Fixed Assets (Tables)
Fixed Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | The following is a summary of the Company’s fixed assets as of December 31: 2017 2016 Cost Accumulated Depreciation Net Book Value Cost Accumulated Depreciation Net Book Value Computers, furniture and fixtures $ 101,806 $ (74,429 ) $ 27,377 $ 91,909 $ (64,030 ) $ 27,879 Leasehold improvements 112,099 (49,170 ) 62,929 91,601 (41,103 ) 50,498 $ 213,905 $ (123,599 ) $ 90,306 $ 183,510 $ (105,133 ) $ 78,377 |
Accrued and Other Liabilities (
Accrued and Other Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
Accrued and Other Liabilities Disclosure | Changes in noncontrolling interest amounts included in accrued and other liabilities for the three years ended December 31, were as follows: Noncontrolling Interests Balance at December 31, 2014 $ 6,014 Income attributable to noncontrolling interests 9,054 Distributions made (9,503 ) Other (1) (92 ) Balance at December 31, 2015 $ 5,473 Income attributable to noncontrolling interests 5,218 Distributions made (7,772 ) Other (1) 1,235 Balance at December 31, 2016 $ 4,154 Income attributable to noncontrolling interests 15,375 Distributions made (8,865 ) Other (1) 366 Balance at December 31, 2017 $ 11,030 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Goodwill Global Integrated Agencies Domestic Creative Agencies Specialist Communications Media Services All Other Total Balance at December 31, 2015 $ 364,159 $ 36,671 $ 97,578 $ 142,286 $ 229,607 $ 870,301 Acquired goodwill 24,778 — — — — 24,778 Disposition — — — — (764 ) (764 ) Impairment loss recognized — — (18,893 ) — (29,631 ) (48,524 ) Transfer of goodwill between segments (1) (34,400 ) — — 34,400 — — Foreign currency translation (3,821 ) 91 6 — 2,692 (1,032 ) Balance at December 31, 2016 $ 350,716 $ 36,762 $ 78,691 $ 176,686 $ 201,904 $ 844,759 Acquired goodwill — — — — — — Disposition (964 ) — — (16,629 ) — (17,593 ) Impairment loss recognized — — — — (3,238 ) (3,238 ) Transfer of goodwill between segments (1) 3,630 — — — (3,630 ) — Foreign currency translation 5,689 218 15 — 6,085 12,007 Balance at December 31, 2017 $ 359,071 $ 36,980 $ 78,706 $ 160,057 $ 201,121 $ 835,935 (1) During the year ended December 31, 2017 and 2016, the Company transferred a component of one reporting unit to another reporting unit. An interim impairment analysis was performed both before and after the transfer, noting no impairment indicators were present. As a result of the annual impairment test performed as of October 1, 2017, the Company recognized a partial impairment of goodwill of $3,238 relating to two of the Company’s reporting units. See Note 2 of the Notes to the Consolidated Financial Statements herein for further information. Additionally, during 2017, the Company wrote off goodwill of $17,593 related to the sale of certain subsidiaries. This write off is included in other income (expense). During the third quarter of 2016, there was a change to the Company’s reporting units. This change, coupled with a decline in operating performance required the Company to perform interim goodwill testing on one of its experiential reporting units. Additionally, a triggering event occurred during the third quarter of 2016 that required the Company to perform interim goodwill testing on one non-material reporting unit. This interim impairment analysis resulted in a partial impairment of goodwill of $27,893 and $1,738 relating to the experiential reporting unit and non-material reporting unit, respectively. For the 2016 annual impairment test, a partial impairment of goodwill of $18,893 in one of the Company’s strategic communications reporting units. The fair value for all other reporting units were in excess of their respective carrying amounts and as a result there was no additional impairment of goodwill. Additionally, in the third quarter of 2016, the Company sold its ownership interests in a subsidiary to the noncontrolling shareholders, resulting in a write off of goodwill of $764 . The total accumulated goodwill impairment charges are $98,645 through December 31, 2017 . As of December 31, the gross and net amounts of acquired intangible assets other than goodwill were as follows: For the Year Ended December 31, Intangible Assets 2017 2016 Trademarks (indefinite life) $ 17,780 $ 17,780 Customer relationships – gross $ 102,325 $ 121,408 Less accumulated amortization (73,767 ) (80,432 ) Customer relationships – net $ 28,558 $ 40,976 Other intangibles – gross $ 37,273 $ 43,656 Less accumulated amortization (13,006 ) (17,341 ) Other intangibles – net $ 24,267 $ 26,315 Total intangible assets $ 157,378 $ 182,844 Less accumulated amortization (86,773 ) (97,773 ) Total intangible assets – net $ 70,605 $ 85,071 |
Schedule of Intangible Assets and Goodwill | For the Year Ended December 31, Intangible Assets 2017 2016 Trademarks (indefinite life) $ 17,780 $ 17,780 Customer relationships – gross $ 102,325 $ 121,408 Less accumulated amortization (73,767 ) (80,432 ) Customer relationships – net $ 28,558 $ 40,976 Other intangibles – gross $ 37,273 $ 43,656 Less accumulated amortization (13,006 ) (17,341 ) Other intangibles – net $ 24,267 $ 26,315 Total intangible assets $ 157,378 $ 182,844 Less accumulated amortization (86,773 ) (97,773 ) Total intangible assets – net $ 70,605 $ 85,071 |
Finite-lived Intangible Assets Amortization Expense | The estimated amortization expense for the five succeeding years is as follows: Year Amortization 2018 $ 13,051 2019 8,832 2020 6,619 2021 5,038 2022 4,520 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The components of the Company’s income (loss) from continuing operations before income taxes and equity in earnings of non-consolidated affiliates by taxing jurisdiction for the years ended December 31, were: 2017 2016 2015 Income (Loss): U.S. $ 48,053 $ (16,661 ) $ 23,180 Non-U.S. 39,025 (33,055 ) (40,596 ) $ 87,078 $ (49,716 ) $ (17,416 ) |
Schedule Of Components Of Income Taxes Provision Benefit | The provision (benefit) for income taxes by taxing jurisdiction for the years ended December 31, were: 2017 2016 2015 Current tax provision U.S. federal $ (1,657 ) $ — $ — U.S. state and local 98 (1,520 ) 1,375 Non-U.S. 6,514 2,154 2,465 4,955 634 3,840 Deferred tax provision (benefit): U.S. federal (172,873 ) 5,785 5,359 U.S. state and local (7,775 ) (3,550 ) 2,877 Non-U.S. 7,629 (12,273 ) (8,315 ) (173,019 ) (10,038 ) (79 ) Income tax provision (benefit) $ (168,064 ) $ (9,404 ) $ 3,761 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of income tax expense (benefit) using the statutory Canadian federal and provincial income tax rate compared with actual income tax expense for the years ended December 31, is as follows: 2017 2016 2015 Income (loss) from continuing operations before income taxes, equity in non-consolidated affiliates and noncontrolling interest $ 87,078 $ (49,716 ) $ (17,416 ) Statutory income tax rate 26.5 % 26.5 % 26.5 % Tax expense (benefit) using statutory income tax rate 23,076 (13,175 ) (4,615 ) State and foreign taxes 8,863 (94 ) 3,524 Non-deductible stock-based compensation 1,441 1,123 665 Other non-deductible expense (220 ) 1,848 163 Change to valuation allowance (103,212 ) 6,605 3,565 Effect of the difference in Canadian and local statutory rates 4,463 (4,579 ) 1,906 Impact of tax reform (100,472 ) — — Noncontrolling interests (4,413 ) (1,287 ) (2,399 ) Impact of foreign operations (2,453 ) — — Other, net 4,863 155 952 Income tax expense (benefit) $ (168,064 ) $ (9,404 ) $ 3,761 Effective income tax rate (193.0 )% 18.9 % (21.6 )% |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of significant temporary differences representing deferred tax assets and liabilities at December 31, were as follows: 2017 2016 Deferred tax assets: Capital assets and other $ 5,059 $ 6,758 Net operating loss carry forwards 49,318 44,305 Interest deductions 2,026 12,146 Refinancing charge 5,578 7,413 Goodwill and intangibles 129,455 179,029 Stock compensation 1,208 2,581 Pension plan 4,165 5,095 Unrealized foreign exchange 8,653 15,237 Capital loss carry forwards 11,450 10,957 Accounting reserves 412 7,138 Gross deferred tax asset 217,324 290,659 Less: valuation allowance (19,032 ) (248,866 ) Net deferred tax assets 198,292 41,793 Deferred tax liabilities: Deferred finance charges — (333 ) Capital assets and other — (388 ) Goodwill amortization (89,727 ) (109,638 ) Total deferred tax liabilities (89,727 ) (110,359 ) Net deferred tax asset (liability) $ 108,565 $ (68,566 ) Disclosed as: Deferred tax assets $ 115,325 $ 41,793 Deferred tax liabilities (6,760 ) (110,359 ) $ 108,565 $ (68,566 ) |
Schedule Of Changes In Tax Reserve | Changes in the Company’s reserve is as follows: Balance at December 31, 2014 $ 3,073 Charges to income tax expense 960 Settlement of uncertainty (428 ) Balance at December 31, 2015 3,605 Charges to income tax expense (1,261 ) Settlement of uncertainty (879 ) Balance at December 31, 2016 1,465 Charges to income tax expense (32 ) Balance at December 31, 2017 $ 1,433 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | As of December 31, the Company’s indebtedness was comprised as follows: 2017 2016 Revolving credit agreement $ — $ 54,425 6.50% Notes due 2024 900,000 900,000 Debt issuance costs (17,587 ) (18,420 ) 882,413 936,005 Obligations under capital leases 706 431 883,119 936,436 Less: Current portion of long-term debt 313 228 $ 882,806 $ 936,208 |
Schedule Of Future Principal Repayments Of Long Term Debt Including Capital Lease Obligations | Future principal repayments, including capital lease obligations, for the years ended December 31, and in aggregate, are as follows: Period Amount 2018 $ 313 2019 320 2020 68 2021 5 2022 — 2023 and thereafter 900,000 $ 900,706 |
Schedule of Future Minimum Lease Payments for Capital Leases | Future minimum capital lease payments for the years ended December 31 and in aggregate, are as follows: Period Amount 2018 $ 313 2019 320 2020 68 2021 5 2022 — 2023 and thereafter — 706 Less: imputed interest (59 ) 647 Less: current portion (313 ) $ 334 |
Share Capital (Tables)
Share Capital (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Share-based Compensation, Stock Options and Stock Appreciation Rights Award Activity [Table Text Block] | SARs Outstanding SARs Exercisable Non Vested SARs Number Outstanding Weighted Average Number Outstanding Weighted Average Balance at December 31, 2016 — $ — $ — $ — — Vested — — — — — Granted 327,500 6.60 — — 327,500 Exercised — — — — — Expired and canceled — — — — — Balance at December 31, 2017 327,500 $ 6.60 — $ — 327,500 |
Schedule of Share-based Compensation, Performance Shares and Time Based Award Activity | The following table summarizes information about time based and financial performance-based restricted stock and restricted stock unit awards granted under the 2005 Incentive Plan, 2008 Key Partner Incentive Plan, 2011 Stock Incentive Plan and 2016 Stock Incentive Plan: Performance Based Awards Time Based Awards Shares Weighted Average Grant Date Fair Shares Weighted Average Balance at December 31, 2014 86,030 $ 23.14 916,141 $ 16.36 Granted 80,000 21.76 191,155 20.42 Vested (68,067 ) 25.21 (297,794 ) 12.35 Forfeited — — (35,000 ) 21.69 Balance at December 31, 2015 97,963 $ 19.61 774,502 $ 18.71 Granted 10,000 14.00 392,500 12.53 Vested (17,963 ) 10.02 (380,367 ) 16.02 Forfeited — — (46,000 ) 20.39 Balance at December 31, 2016 90,000 $ 20.90 740,635 $ 16.71 Granted — — 358,000 8.98 Vested (90,000 ) 20.90 (277,050 ) 19.62 Forfeited — — (36,500 ) 14.15 Balance at December 31, 2017 — $ — 785,085 $ 12.28 |
Schedule of Share-based Compensation, Stock Options, Activity | Information related to share option transactions grant under all plans over the past three years is summarized as follows: Options Outstanding Options Exercisable Non Vested Options Number Outstanding Weighted Average Number Outstanding Weighted Average Balance at December 31, 2014 112,500 $ 5.70 112,500 $ 5.70 — Vested — — — — — Granted — — — — — Exercised 37,500 4.72 — — — Expired and canceled — — — — — Balance at December 31, 2015 75,000 $ 5.28 75,000 $ 5.28 — Vested — — — — — Granted — — — — — Exercised 37,500 5.97 — — — Expired and canceled — — — — — Balance at December 31, 2016 37,500 $ 5.83 37,500 $ 5.83 — Vested — — — — — Granted — — — — — Exercised 37,500 5.83 — — — Expired and canceled — — — — — Balance at December 31, 2017 — $ — — $ — — |
Employee Stock Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Share-based Compensation, Activity | . |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value, Inputs, Level 1 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | The following table presents certain information for our financial liability that is measured at fair value on a non-recurring basis at December 31: 2017 2016 Carrying Amount Fair Value Carrying Amount Fair Value Liabilities: 6.50% Senior Notes due 2024 900,000 904,500 900,000 812,250 |
Fair Value, Inputs, Level 3 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | The following table presents changes in deferred acquisition consideration which is measured at fair value on recurring basis for the years ended December 31: Fair Value Measurements Using 2017 2016 Beginning balance of contingent payments $ 224,754 $ 306,734 Payments (1) (110,234 ) (105,169 ) Additions (2) — 16,132 Redemption value adjustments (3) 3,273 13,930 Other (4) — (6,412 ) Foreign translation adjustment 1,293 (461 ) Ending balance of contingent payments $ 119,086 $ 224,754 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Years Ended December 31, 2017 2016 2015 Revenue: Global Integrated Agencies $ 786,644 $ 696,410 $ 652,987 Domestic Creative Agencies 90,663 85,953 91,658 Specialist Communications 172,565 170,285 153,920 Media Services 142,387 131,498 132,419 All Other 321,520 301,639 295,272 Total $ 1,513,779 $ 1,385,785 $ 1,326,256 Segment operating income (loss): Global Integrated Agencies $ 74,902 $ 58,505 $ 66,161 Domestic Creative Agencies 16,977 16,583 17,535 Specialist Communications 20,714 1,939 18,047 Media Services 12,963 6,154 20,116 All Other 47,259 9,368 15,423 Corporate (40,856 ) (44,118 ) (65,172 ) Total $ 131,959 $ 48,431 $ 72,110 Other Income (Expense): Other income, net 1,346 414 7,238 Foreign exchange gain (loss) 18,137 (213 ) (39,328 ) Interest expense and finance charges, net (64,364 ) (65,858 ) (57,436 ) Loss on redemption of Notes — (33,298 ) — Income (loss) from continuing operations before income taxes and equity in earnings of non-consolidated affiliates 87,078 (49,716 ) (17,416 ) Income tax expense (benefit) (168,064 ) (9,404 ) 3,761 Income (loss) from continuing operations before equity in earnings of non-consolidated affiliates 255,142 (40,312 ) (21,177 ) Equity in earnings (loss) of non-consolidated affiliates 2,081 (309 ) 1,058 Income (loss) from continuing operations 257,223 (40,621 ) (20,119 ) Income (loss) from discontinued operations attributable to MDC Partners Inc., net of taxes — — (6,281 ) Net income (loss) 257,223 (40,621 ) (26,400 ) Net income attributable to the noncontrolling interest (15,375 ) (5,218 ) (9,054 ) Net income (loss) attributable to MDC Partners Inc. $ 241,848 $ (45,839 ) $ (35,454 ) Years Ended December 31, 2017 2016 2015 Depreciation and amortization: Global Integrated Agencies $ 23,800 $ 21,447 $ 20,599 Domestic Creative Agencies 1,434 1,653 1,855 Specialist Communications 4,714 6,637 11,201 Media Services 3,629 5,718 4,660 All Other 8,799 9,406 12,134 Corporate 1,098 1,585 1,774 Total $ 43,474 $ 46,446 $ 52,223 Stock-based compensation: Global Integrated Agencies $ 15,203 $ 12,141 $ 6,981 Domestic Creative Agencies 845 634 644 Specialist Communications 2,954 3,629 1,510 Media Services 614 301 471 All Other 2,600 1,773 5,450 Corporate 2,134 2,525 2,740 Total $ 24,350 $ 21,003 $ 17,796 Capital expenditures: Global Integrated Agencies $ 20,748 $ 16,439 $ 17,043 Domestic Creative Agencies 1,032 1,055 1,321 Specialist Communications 1,288 2,741 1,311 Media Services 3,035 5,110 825 All Other 6,832 4,054 2,704 Corporate 23 33 371 Total $ 32,958 $ 29,432 $ 23,575 |
Schedule Of Fixed Assets Goodwill Intangibles Net | A summary of the Company’s long-lived assets, comprised of fixed assets, goodwill and intangibles, net, by geographic region at December 31, is set forth in the following table. United States Canada Other Total Long-lived Assets 2017 $ 77,163 $ 5,638 $ 7,505 $ 90,306 2016 $ 67,617 $ 5,887 $ 4,873 $ 78,377 Goodwill and Intangible Assets 2017 $ 706,241 $ 127,014 $ 73,285 $ 906,540 2016 $ 736,334 $ 121,987 $ 71,509 $ 929,830 |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | A summary of the Company’s revenue by geographic region at December 31 is set forth in the following table. United States Canada Other Total Revenue: 2017 $ 1,172,364 $ 123,092 $ 218,323 $ 1,513,779 2016 $ 1,103,714 $ 124,101 $ 157,970 $ 1,385,785 2015 $ 1,085,051 $ 129,039 $ 112,166 $ 1,326,256 |
Commitments, Contingencies an43
Commitments, Contingencies and Guarantees (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Minimum rental commitments for the rental of office and production premises and equipment under non-cancellable leases net of sublease income, some of which provide for rental adjustments due to increased property taxes and operating costs, for the years ending December 31, 2018 and thereafter, are as follows: Period Amount 2018 $ 58,172 2019 56,751 2020 55,065 2021 41,830 2022 32,595 2023 and thereafter 122,947 $ 367,360 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | ||
Schedule of Net Periodic Benefit Cost Not yet Recognized | Net periodic pension cost consists of the following components for the years ended December 31: Pension Pension 2017 2016 Service cost $ — $ — Interest cost on benefit obligation 1,725 1,855 Expected return on plan assets (1,830 ) (1,863 ) Curtailment and settlements — 929 Amortization of actuarial losses 222 137 Net periodic benefit cost $ 117 $ 1,058 | |
Schedule of Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) | Other changes in plan assets and benefit obligation recognized in Other Comprehensive Loss consist of the following components for the years ended December 31: Pension Pension 2017 2016 Curtailment/settlement $ — $ — Current year actuarial (gain) loss 1,558 3,238 Amortization of actuarial gain (loss) (222 ) (137 ) Total recognized in other comprehensive (income) loss $ 1,336 $ 3,101 Total recognized in net periodic benefit cost and other comprehensive (income) loss $ 1,453 $ 4,159 | |
Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets | The following table summarizes the change in benefit obligations and fair values of plan assets for the years ended December 31: 2017 2016 Change in benefit obligation: Benefit obligation, Beginning balance $ 40,722 $ 40,296 Interest Cost 1,725 1,855 Actuarial losses 3,088 2,502 Benefits paid (1,785 ) (3,931 ) Benefit obligation, Ending balance 43,750 40,722 Change in plan assets: Fair value of plan assets, Beginning balance 24,482 25,190 Actual return on plan assets 3,360 198 Employer contributions 1,920 3,025 Benefits paid (1,785 ) (3,931 ) Fair value of plan assets, Ending balance 27,977 24,482 Unfunded status $ 15,773 $ 16,240 | |
Schedule of Amounts Recognized in Balance Sheet | Pension Pension 2017 2016 Non-current liability $ 15,773 $ 16,240 Net amount recognized $ 15,773 $ 16,240 | |
Schedule of Amounts Recognized in Other Comprehensive Income (Loss) | Amounts recognized, net of tax, in Accumulated Other Comprehensive Loss consists of the following components for the years ended December 31: Pension Pension 2017 2016 Accumulated net actuarial losses $ 13,656 $ 12,320 Amount recognized, net of tax $ 13,656 $ 12,320 | |
Schedule Of Assumptions Used To Determine Benefit Obligations | eighted average assumptions were used to determine benefit obligations as of December 31: Pension Pension 2017 2016 Discount rate 3.83 % 4.32 % Rate of compensation increase N/A N/A | |
Schedule Of Assumptions Used To Determine Net Periodic Cost | eighted average assumptions were used to determine net periodic costs at December 31: Pension Pension 2017 2016 Discount rate 4.32 % 4.69 % Expected return on plan assets 7.40 % 7.40 % Rate of compensation increase N/A N/A | |
Schedule of Changes in Fair Value of Plan Assets | The Defined Benefit plan assets fall into any of three fair value classifications as defined in the FASB ASC Topic 820, Fair Value Measurements. There are no Level 3 assets held by the plan. The fair value of the plan assets as of December 31 is as follows: December 31, 2017 Level 1 Level 2 Level 3 Asset Category: Money Market Fund – Short Term Investments $ 1,695 $ 1,695 $ — $ — Mutual Funds 26,282 26,282 — — Total $ 27,977 $ 27,977 $ — $ — December 31, 2016 Level 1 Level 2 Level 3 Asset Category: Money Market Fund – Short Term Investments $ 1,687 $ 1,687 $ — $ — Mutual Funds 22,795 22,795 — — Total $ 24,482 $ 24,482 $ — $ — | |
Schedule of Allocation of Plan Assets | The pension plans weighted-average asset allocation for the years ended December 31, 2017, and 2016 are as follows: Target Allocation Actual Allocation Actual Allocation 2017 2017 2016 Asset Category: Equity Securities 68.0 % 68.9 % 65.5 % Debt Securities 31.0 % 25.0 % 27.6 % Cash/Cash Equivalents and Short Term Investments 1.0 % 6.1 % 6.9 % 100 % 100 % 100 % | |
Schedule of Amounts in Accumulated Other Comprehensive Income (Loss) to be Recognized over Next Fiscal Year | The estimated amounts that will be amortized in 2018 are as follows: Pension Estimated Amortization: 2018 Net loss amortization 258 Total $ 258 | |
Schedule of Expected Benefit Payments | The following estimated benefit payments, which reflect expected future service, as appropriate, are expected to be paid in the years ending December 31: Period Amount 2018 $ 1,806 2019 1,903 2020 2,090 2021 2,077 2022 2,109 2023 – 2027 12,010 |
Changes in Accumulated Other 45
Changes in Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The changes in accumulated other comprehensive income (loss) for the year ended December 31 were: Defined Foreign Currency Translation Total Balance December 31, 2015 $ (9,219 ) $ 15,476 $ 6,257 Other comprehensive income before reclassifications — (4,980 ) (4,980 ) Amounts reclassified from accumulated other comprehensive income (loss) (3,101 ) — (3,101 ) Other comprehensive income (loss) $ (3,101 ) $ (4,980 ) $ (8,081 ) Balance December 31, 2016 $ (12,320 ) $ 10,496 $ (1,824 ) Other comprehensive income before reclassifications $ — $ 1,206 $ 1,206 Amounts reclassified from accumulated other comprehensive income (loss) (net of tax benefit of $528) (1,336 ) — (1,336 ) Other comprehensive income (loss) (1,336 ) 1,206 (130 ) Balance December 31, 2017 $ (13,656 ) $ 11,702 $ (1,954 ) |
Schedule of Defined Benefit Plans Disclosures | Reclassifications for the years ended December 31, net of tax, were as follows: 2017 2016 Current year actuarial (gain) loss $ 1,558 $ 3,238 Amortization of actuarial gain (loss) (222 ) (137 ) Total amount reclassified from accumulated other comprehensive income (loss), net of tax $ 1,336 $ 3,101 |
Quarterly Results of Operatio46
Quarterly Results of Operations (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | . Quarterly Results of Operations (Unaudited) The following table sets forth a summary of the Company’s consolidated unaudited quarterly results of operations for the years ended December 31, in thousands of dollars, except per share amounts. Quarters First Second Third Fourth Revenue: 2017 $ 344,700 $ 390,532 $ 375,800 $ 402,747 2016 $ 309,042 $ 337,047 $ 349,254 $ 390,442 Cost of services sold: 2017 $ 237,563 $ 267,822 $ 249,418 $ 268,673 2016 $ 211,446 $ 228,835 $ 235,659 $ 260,193 Income (loss) from continuing operations: 2017 $ (9,683 ) $ 13,467 $ 21,984 $ 231,455 2016 $ (22,773 ) $ 2,089 $ (31,081 ) $ 11,144 Net income (loss) attributable to MDC Partners Inc.: 2017 $ (10,566 ) $ 11,253 $ 18,493 $ 222,668 2016 $ (23,632 ) $ 835 $ (32,140 ) $ 9,098 Income (loss) per common share: Basic Continuing operations: 2017 $ (0.21 ) $ 0.14 $ 0.25 $ 3.33 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 Net income (loss): 2017 $ (0.21 ) $ 0.14 $ 0.25 $ 3.33 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 Diluted Continuing operations: 2017 $ (0.21 ) $ 0.14 $ 0.24 $ 3.30 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 (1) Net income (loss): 2017 $ (0.21 ) $ 0.14 $ 0.24 $ 3.30 2016 $ (0.47 ) $ 0.02 $ (0.62 ) $ 0.17 (1) |
Significant Accounting Polici47
Significant Accounting Policies - Redeemable Noncontrolling Interest (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Redeemable Noncontrolling Interest [Line Items] | ||||
Consolidated Accounts Receivable Percentage | 10.00% | 10.00% | ||
Redeemable Noncontrolling Interest [Roll Forward] | ||||
Redeemable Noncontrolling Interest, Equity, Redemption Value | $ 60,180 | |||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | (9,650) | |||
Increase in noncontrolling interests from business acquisitions | 6,960 | $ 8,936 | $ 51,488 | |
Redeemable Noncontrolling Interest, Equity, Redemption Value | $ 62,886 | 60,180 | ||
Redeemable Noncontrolling Interest [Member] | ||||
Redeemable Noncontrolling Interest [Roll Forward] | ||||
Redeemable Noncontrolling Interest, Equity, Redemption Value | 60,180 | 69,471 | $ 194,951 | |
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 910 | 1,708 | 155,042 | |
Increase in noncontrolling interests from business acquisitions | 1,666 | 2,274 | 7,703 | |
Noncontrolling Interest, Change in Redemption Value | 1,498 | (9,604) | 22,809 | |
Currency translation adjustments | $ 452 | (253) | (950) | |
Redeemable Noncontrolling Interest, Equity, Redemption Value | $ 60,180 | $ 69,471 |
Significant Accounting Polici48
Significant Accounting Policies - Textual (Details) | May 01, 2024 | Oct. 01, 2017 | Apr. 01, 2017 | May 03, 2016 | Oct. 23, 2014USD ($) | Mar. 20, 2013USD ($) | Mar. 28, 2012 | Dec. 31, 2017USD ($)Clients | Dec. 31, 2016USD ($)Clients | Sep. 30, 2016USD ($)reportable_segment | Dec. 31, 2017USD ($)Clientsinvestment$ / shares | Dec. 31, 2016USD ($)Clientsinvestment$ / sharesshares | Dec. 31, 2015USD ($)Clients$ / sharesshares | Mar. 23, 2016 | Dec. 31, 2014 | Dec. 31, 2013 |
Significant Accounting Policies [Line Items] | ||||||||||||||||
Accretion on Convertible Preferred Shares | $ (6,352,000) | $ 0 | $ 0 | |||||||||||||
Earnings Per Share, Increase (Decrease) Due To Non-Controlling Dividend As A Result Of Redeemable Redemption Value In Excess of Fair Value | $ / shares | $ 0 | $ 0 | $ 0 | |||||||||||||
Long-Term Growth Rate Assumed in Annual Goodwill Impairment Test | 3.00% | |||||||||||||||
Debt Issuance Costs, Net | $ 17,587,000 | $ 18,420,000 | $ 17,587,000 | $ 18,420,000 | ||||||||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | $ (4,819,000) | $ 8,227,000 | $ 38,887,000 | |||||||||||||
Clients exceeding consolidated accounts receivable percentage | Clients | 0 | 0 | 0 | 0 | ||||||||||||
Number of Reporting Units | 32 | |||||||||||||||
Consolidated accounts receivable percentage | 10.00% | 10.00% | 10.00% | 10.00% | ||||||||||||
Clients exceeding consolidated largest client revenue | Clients | 0 | 0 | 0 | |||||||||||||
Consolidated largest client revenue | 10.00% | 10.00% | 10.00% | |||||||||||||
Distributions from non-consolidated affiliates | $ 3,672,000 | $ 7,402,000 | $ 0 | |||||||||||||
Cost method investments | $ 9,527,000 | $ 10,132,000 | 9,527,000 | 10,132,000 | ||||||||||||
Goodwill, Impairment Loss | 3,238,000 | 48,524,000 | ||||||||||||||
Business combination, acquisition related costs | 877,000 | 2,640,000 | $ 2,912,000 | |||||||||||||
Assets | 1,698,892,000 | 1,577,378,000 | 1,698,892,000 | 1,577,378,000 | ||||||||||||
Liabilities | $ 1,791,519,000 | 2,026,674,000 | 1,791,519,000 | $ 2,026,674,000 | ||||||||||||
Stock Issued During Period, Shares, New Issues | shares | 0 | 0 | ||||||||||||||
Pension expense | $ 10,124,000 | $ 10,026,000 | $ 6,731,000 | |||||||||||||
Doner | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Variable interest entity, qualitative or quantitative information, ownership percentage | 65.00% | |||||||||||||||
Minimum | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Property, plant and equipment, useful life | 3 years | |||||||||||||||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 12.00% | 12.00% | ||||||||||||||
Weighted Average Cost Of Capital, Annual Goodwill Impairment Test | 9.67% | |||||||||||||||
Maximum | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Property, plant and equipment, useful life | 7 years | |||||||||||||||
Equity method investment, ownership percentage | 50.00% | 50.00% | ||||||||||||||
Reporting Unit, Percentage of Fair Value in Excess of Carrying Amount | 100.00% | 100.00% | ||||||||||||||
Weighted Average Cost Of Capital, Annual Goodwill Impairment Test | 11.85% | |||||||||||||||
Doner | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Variable interest entity, qualitative or quantitative information, ownership percentage | 30.00% | |||||||||||||||
Ownership interest percentage increase on exercise of option | 15.00% | 70.00% | ||||||||||||||
Assets | $ 105,191,000 | 102,456,000 | $ 105,191,000 | 102,456,000 | ||||||||||||
Liabilities | 59,783,000 | 57,622,000 | 59,783,000 | 57,622,000 | ||||||||||||
Doner | Aggregate 2017 Step Up Transactions [Domain] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Ownership interest percentage increase on exercise of option | 85.00% | |||||||||||||||
Contingent Payment [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | $ 18,173,000 | $ 9,211,000 | $ 4,896,000 | $ 7,972,000 | 36,344,000 | |||||||||||
Six Point Five Zero Percentage Notes [Domain] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.50% | 6.50% | 6.50% | |||||||||||||
Six Point Seven Five Percentage Notes [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.75% | 6.75% | 6.75% | 6.75% | 6.75% | |||||||||||
Debt Instrument, Maturity Year | 2,020 | |||||||||||||||
Notes due 2024 [Domain] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.50% | 6.50% | ||||||||||||||
Interest Expense [Member] | Fixed Payment [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | $ 100,000 | $ 255,000 | $ 2,543,000 | |||||||||||||
Equity Method Investments [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Number of investments sold | investment | 2 | |||||||||||||||
Proceeds from Sale of Equity Method Investments | $ 4,023 | |||||||||||||||
Equity Method Investment, Realized Gain (Loss) on Disposal | 623 | |||||||||||||||
Cost-method Investments [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Step acquisition gain on sale of ownership percentage | 3,018 | |||||||||||||||
Cost-method Investments, Realized Losses | $ 935 | |||||||||||||||
Cost Method Investments, Investments Dissolved | 5 | |||||||||||||||
Cost-method Investments, Realized Gain (Loss) | $ 1,309 | |||||||||||||||
Number of investments sold | investment | 3 | 3 | ||||||||||||||
Proceeds from sale of other investments | $ 3,557 | $ 4,074 | ||||||||||||||
Quantitative Assessment [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Number of Reporting Units | 13 | |||||||||||||||
Strategic Communications [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Reporting Units Impaired, Annual Goodwill Impairment Test | 1 | |||||||||||||||
Goodwill, Impairment Loss | $ 18,893,000 | |||||||||||||||
Specialist Communications [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Goodwill, Impairment Loss | $ 0 | $ 18,893,000 | ||||||||||||||
All Other [Domain] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Reporting Units Impaired, Annual Goodwill Impairment Test | 2 | |||||||||||||||
Goodwill, Impairment Loss | $ 3,238,000 | 29,631,000 | ||||||||||||||
Reporting Unit, Negative Carrying Value, Allocated Goodwill | $ 5,479,000 | 5,479,000 | ||||||||||||||
All Other [Domain] | Experiential [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Goodwill, Impairment Loss | $ 27,893,000 | |||||||||||||||
Reporting Units, Goodwill Impairment Test Performed During Interim Period | reportable_segment | 1 | |||||||||||||||
All Other [Domain] | Immaterial [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Goodwill, Impairment Loss | $ 1,738,000 | |||||||||||||||
Reporting Units, Goodwill Impairment Test Performed During Interim Period | reportable_segment | 1 | |||||||||||||||
Domestic Creative Agencies [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Goodwill, Impairment Loss | 0 | $ 0 | ||||||||||||||
Reporting Unit, Negative Carrying Value, Allocated Goodwill | $ 14,853,000 | $ 14,853,000 | ||||||||||||||
Wells Fargo Capital Finance, Llc [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, Maturity Date | May 3, 2021 | Sep. 30, 2019 | ||||||||||||||
Wells Fargo Capital Finance, Llc [Member] | Revolving Credit Facility [Member] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 325,000,000 | $ 0 | ||||||||||||||
Scenario, Forecast [Member] | Wells Fargo Capital Finance, Llc [Member] | Six Point Five Zero Percentage Notes [Domain] | ||||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||||
Debt Instrument, Maturity Year | 2,024 |
Loss per Common Share - Schedu
Loss per Common Share - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |||||||||||
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest | $ 231,455 | $ 21,984 | $ 13,467 | $ (9,683) | $ 11,144 | $ (31,081) | $ 2,089 | $ (22,773) | $ 257,223 | $ (40,621) | $ (20,119) |
Accretion on Convertible Preferred Shares | (6,352) | 0 | 0 | ||||||||
Net Income Allocated to Convertible Shares | (29,902) | 0 | 0 | ||||||||
Income (Loss) from Continuing Operations Attributable to Parent, Basic | 205,594 | (45,839) | (29,173) | ||||||||
Numerator: | |||||||||||
Net income attributable to the noncontrolling interests | (15,375) | (5,218) | (9,054) | ||||||||
Income (Loss) from Continuing Operations Attributable to Parent | 241,848 | (45,839) | (29,173) | ||||||||
Adjustment to Net Income, Allocated to Convertible Shares | 106 | 0 | 0 | ||||||||
Income (Loss) from Continuing Operations Attributable to Parent, Diluted | $ 205,700 | $ (45,839) | $ (29,173) | ||||||||
Denominator: | |||||||||||
Basic weighted average number of common shares outstanding | 55,255,797 | 51,345,807 | 49,875,282 | ||||||||
Effect of dilutive securities: | |||||||||||
Impact of stock options and non-vested stock under employee stock incentive plans | 225,989 | 0 | 0 | ||||||||
Diluted weighted average number of common shares outstanding | 55,481,786 | 51,345,807 | 49,875,282 | ||||||||
Income (Loss) from Continuing Operations, Per Basic Share | $ 3.33 | $ 0.25 | $ 0.14 | $ (0.21) | $ 0.17 | $ (0.62) | $ 0.02 | $ (0.47) | $ 3.72 | $ (0.89) | $ (0.58) |
Income (Loss) from Continuing Operations, Per Diluted Share | $ 3.30 | $ 0.24 | $ 0.14 | $ (0.21) | $ 0.17 | $ (0.62) | $ 0.02 | $ (0.47) | $ 3.71 | $ (0.89) | $ (0.58) |
Loss per Common Share - Textua
Loss per Common Share - Textual (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income (Loss) from Continuing Operations, Per Basic Share | $ 3.33 | $ 0.25 | $ 0.14 | $ (0.21) | $ 0.17 | $ (0.62) | $ 0.02 | $ (0.47) | $ 3.72 | $ (0.89) | $ (0.58) |
Net Income Allocated to Convertible Shares | $ (29,902) | $ 0 | $ 0 | ||||||||
Antidilutive securities excluded from computation of earnings per share, amount | 886,596 | 1,391,456 | 947,465 | ||||||||
Contingent Restricted Stock Units (RSUs) [Member] | |||||||||||
Antidilutive securities excluded from computation of earnings per share, amount | 1,433,921 | ||||||||||
Preferred Stock [Member] | Series 4 Convertible Preferred Stock [Domain] | |||||||||||
Shares, Outstanding | 95,000,000 | 0 | 95,000,000 | 0 | |||||||
Convertible Preferred Stock, Shares Issued upon Conversion | 10,135,244 | 10,135,244 |
Acquisitions - Textual (Detail
Acquisitions - Textual (Details) - USD ($) | Apr. 05, 2017 | Apr. 01, 2017 | Jul. 01, 2016 | Mar. 28, 2012 | Dec. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Apr. 01, 2016 | Oct. 31, 2015 | May 31, 2015 | May 01, 2015 |
Business Acquisition [Line Items] | ||||||||||||||||
Disposal Group, Including Discontinued Operation, Revenue | $ 27,025,000 | |||||||||||||||
Share-based Compensation | $ 7,480,000 | $ 5,560,000 | $ 24,350,000 | $ 21,003,000 | 17,796,000 | |||||||||||
Gain (Loss) on Disposition of Business | $ (800,000) | (940,000) | ||||||||||||||
Goodwill, Written off Related to Sale of Business Unit | $ 764,000 | 17,593,000 | 764,000 | |||||||||||||
Noncontrolling Interest, Decrease from Deconsolidation | 10,657,000 | |||||||||||||||
Goodwill | 0 | 24,778,000 | ||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | $ (9,650,000) | |||||||||||||||
Intangible assets amortization period (years) | 7 years | |||||||||||||||
Ownership percentage by parent | 100.00% | 100.00% | ||||||||||||||
Adjustments to deferred acquisition consideration included in share-based compensation | $ 13,079 | 10,341 | 9,359 | |||||||||||||
Stock Issued During Period, Value, Acquisitions | 34,219,000 | |||||||||||||||
Noncontrolling Interest, Increase from Business Combination | 6,960,000 | 8,936,000 | 51,488,000 | |||||||||||||
Disposal Group, Including Discontinued Operation, Operating Income (Loss) | (322,000) | |||||||||||||||
Disposal Group, Including Discontinued Operation, Other Expense | 752,000 | |||||||||||||||
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax | (5,207,000) | |||||||||||||||
Loss from discontinued operations | 0 | 0 | (6,281,000) | |||||||||||||
Doner | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Variable interest entity, qualitative or quantitative information, ownership percentage | 65.00% | |||||||||||||||
Aggregate 2017 Step Up Transactions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Share-based Compensation | 996 | |||||||||||||||
Cost of acquired entity, cash paid | 3,858 | |||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 11,965 | |||||||||||||||
Business Combination, Contingent Consideration, Liability | $ 7,208 | 7,208 | ||||||||||||||
Business Combination, Acquisition of Less than 100 Percent, Redeemable Noncontrolling Interest, Fair Value | 816 | |||||||||||||||
Noncontrolling Interest, Period Increase (Decrease) | 397 | |||||||||||||||
Noncontrolling Interest, Increase from Business Combination | 2,315 | |||||||||||||||
Aggregate 2017 Dispositions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Share-based Compensation | 2,000 | |||||||||||||||
Gain (Loss) on Disposition of Business | (1,732,000) | |||||||||||||||
Goodwill, Written off Related to Sale of Business Unit | 17,593 | |||||||||||||||
Aggregate 2016 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Cost of acquired entity, cash paid | 1,581 | |||||||||||||||
Business Combinations, Assets Relinquished by Acquirer | 428 | |||||||||||||||
Business Combinations, Liabilities Relinquished Previously due to Acquiree | 94 | |||||||||||||||
Aggregate 2015 Acquisitions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Combination, Consideration Transferred | 55,279 | |||||||||||||||
Cost of acquired entity, cash paid | 23,000 | |||||||||||||||
Business Combination, Consideration Transferred, Liabilities Incurred | 32,279 | |||||||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 16,721 | |||||||||||||||
Goodwill | $ 43,654 | |||||||||||||||
Intangible assets amortization period (years) | 6 years 4 months | |||||||||||||||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | $ 9,720 | |||||||||||||||
Aggregate 2015 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Combination, Consideration Transferred | 200,822 | |||||||||||||||
Cost of acquired entity, cash paid | 37,467 | |||||||||||||||
Business Combination, Consideration Transferred, Liabilities Incurred | 163,355 | |||||||||||||||
Forsman & Bodenfors AB [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Pro forma revenue | $ 43,535 | |||||||||||||||
Pro forma net income (loss) | 4,460 | |||||||||||||||
Percentage of voting interests acquired | 100.00% | |||||||||||||||
Business Combination, Consideration Transferred | $ 49,837 | |||||||||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 36,698 | |||||||||||||||
Goodwill | $ 24,778 | |||||||||||||||
Intangible assets amortization period (years) | 10 years 9 months | |||||||||||||||
Business Combination, Acquisition of Less than 100 Percent, Noncontrolling Interest, Fair Value | $ 5,514 | |||||||||||||||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 0 | |||||||||||||||
Deferred Taxes, Business Combination, Valuation Allowance, Available to Reduce Intangible Assets | 8,074 | |||||||||||||||
Business Combination, Contingent Consideration, Liability | $ 15,618 | $ 3,055 | ||||||||||||||
Y Media Labs LLC [Domain] | Aggregate 2015 Acquisitions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percentage of voting interests acquired | 60.00% | |||||||||||||||
Unique Influence LLC [Domain] | Aggregate 2015 Acquisitions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Acquisition, Percentage of Net Assets Acquired | 100.00% | |||||||||||||||
Luntz Global Partners LLC | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percentage of voting interests acquired | 40.00% | |||||||||||||||
Doner | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percentage of voting interests acquired | 15.00% | 70.00% | ||||||||||||||
Variable interest entity, qualitative or quantitative information, ownership percentage | 30.00% | |||||||||||||||
Doner | Aggregate 2017 Step Up Transactions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Percentage of voting interests acquired | 85.00% | |||||||||||||||
Noncontrolling Interest Equity [Domain] | Aggregate 2017 Dispositions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Increase from Sale of Parent Equity Interest | 6,961 | |||||||||||||||
Redeemable Noncontrolling Interest [Member] | Aggregate 2017 Dispositions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Redeemable Noncontrolling Interest, Increase from Sale of Equity Interest | 1,690 | |||||||||||||||
Additional Paid-in Capital | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 2,315,000 | |||||||||||||||
Noncontrolling Interest, Increase from Business Combination | (5,654,000) | 22,776,000 | (42,780,000) | |||||||||||||
Additional Paid-in Capital | Aggregate 2016 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 22,775 | |||||||||||||||
Additional Paid-in Capital | Aggregate 2015 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 42,780 | |||||||||||||||
Noncontrolling Interest [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | (11,965,000) | |||||||||||||||
Noncontrolling Interest, Increase from Business Combination | 12,614,000 | (13,840,000) | (8,708,000) | |||||||||||||
Noncontrolling Interest [Member] | Aggregate 2017 Dispositions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Deconsolidation | 10,657,000 | |||||||||||||||
Noncontrolling Interest [Member] | Aggregate 2016 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 19,354 | |||||||||||||||
Noncontrolling Interest [Member] | Aggregate 2015 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 8,708 | |||||||||||||||
Redeemable Noncontrolling Interest [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 910,000 | 1,708,000 | $ 155,042,000 | |||||||||||||
Noncontrolling Interest, Increase from Business Combination | 1,666,000 | 2,274,000 | $ 7,703,000 | |||||||||||||
Redeemable Noncontrolling Interest [Member] | Aggregate 2016 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 1,005 | |||||||||||||||
Redeemable Noncontrolling Interest [Member] | Aggregate 2015 Acquisitions [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Combination, Acquisition of Less than 100 Percent, Noncontrolling Interest, Fair Value | 1,999 | |||||||||||||||
Redeemable Noncontrolling Interest [Member] | Aggregate 2015 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | 149,335 | |||||||||||||||
Contingent payment [Domain] | Aggregate 2016 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Combination, Consideration Transferred | 4,052 | |||||||||||||||
Business Combination, Deferred Stock-based Compensation, Discounted | 2,393 | |||||||||||||||
Fixed payments [Member] | Aggregate 2016 Step Up Transactions [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Combination, Consideration Transferred | $ 467 | |||||||||||||||
Common Class A | Common Stock [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Stock Issued During Period, Shares, Acquisitions | 1,900,000 | |||||||||||||||
Common Class A | Common Stock [Member] | Forsman & Bodenfors AB [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Stock Issued During Period, Shares, Acquisitions | 2,450,000 | 1,900,000 | ||||||||||||||
Stock Issued During Period, Value, Acquisitions | $ 20,800 | $ 34,219 | $ 0 | $ 34,219,000 | $ 0 | |||||||||||
Contractual redemption right [Member] | Forsman & Bodenfors AB [Domain] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Combination, Acquisition of Less than 100 Percent, Noncontrolling Interest, Fair Value | $ 2,275 | |||||||||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Disposal Group, Including Discontinued Operation, Consideration | $ 17,000,000 |
Acquisitions - Schedule of Net
Acquisitions - Schedule of Net Income (Loss) Attributable to Parent and Transfers (to) from Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Noncontrolling Interest [Line Items] | |||||||||||
Net income (loss) attributable to MDC Partners Inc. | $ 222,668 | $ 18,493 | $ 11,253 | $ (10,566) | $ 9,098 | $ (32,140) | $ 835 | $ (23,632) | $ 241,848 | $ (45,839) | $ (35,454) |
Transfers (to) from the noncontrolling interests | |||||||||||
Change from net income (loss) attributable to MDC Partners Inc. and transfers (to) from noncontrolling interests | 244,163 | (23,063) | (78,234) | ||||||||
Additional Paid-in Capital [Member] | |||||||||||
Transfers (to) from the noncontrolling interests | |||||||||||
Increase (Decrease) in Noncontrolling Interests from Business Acquisitions | $ 2,315 | $ 22,776 | $ (42,780) |
Fixed Assets - Schedule of Pro
Fixed Assets - Schedule of Property, Plant, and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Cost | $ 213,905 | $ 183,510 |
Accumulated Depreciation | (123,599) | (105,133) |
Net Book Value | 90,306 | 78,377 |
Computers, furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 101,806 | 91,909 |
Accumulated Depreciation | (74,429) | (64,030) |
Net Book Value | 27,377 | 27,879 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 112,099 | 91,601 |
Accumulated Depreciation | (49,170) | (41,103) |
Net Book Value | $ 62,929 | $ 50,498 |
Fixed Assets - Textual (Detail
Fixed Assets - Textual (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 23,873 | $ 22,293 | $ 18,871 |
Capital Lease Obligations | |||
Property, Plant and Equipment [Line Items] | |||
Capital leased assets, gross | 1,903 | 1,967 | |
Capital leases, lessee balance sheet, assets by major class, accumulated depreciation | $ 1,176 | $ 1,316 |
Accrued and Other Liabilities
Accrued and Other Liabilities - Schedule of Changes in Accrued and Other Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accrued Liabilities and Other Liabilities [Roll Forward] | |||
Beginning balance | $ 4,154 | $ 5,473 | $ 6,014 |
Income attributable to noncontrolling interests | 15,375 | 5,218 | 9,054 |
Distributions to noncontrolling interests | (8,865) | (7,772) | (9,503) |
Other | 366 | 1,235 | (92) |
Ending balance | $ 11,030 | $ 4,154 | $ 5,473 |
Accrued and Other Liabilities56
Accrued and Other Liabilities - Textual (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Accrued Liabilities and Other Liabilities [Abstract] | ||||
Outstanding Checks | $ 41,989,000 | $ 80,193,000 | ||
Accrued media cost, current | 207,482,000 | 201,872,000 | ||
Trust Liability, Current | 4,632,000 | 5,341,000 | ||
Accrued and Other Liabilities Attributable To Noncontrolling Interest | $ 11,030,000 | $ 4,154,000 | $ 5,473,000 | $ 6,014,000 |
Goodwill and Intangible Asset57
Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Roll Forward] | |||
Beginning Balance | $ 870,301,000 | $ 844,759,000 | $ 870,301,000 |
Acquired goodwill | 0 | 24,778,000 | |
Goodwill, Impairment Loss | (764,000) | (17,593,000) | (764,000) |
Goodwill, Impairment Loss | (3,238,000) | (48,524,000) | |
Goodwill, Transfers | 0 | 0 | |
Foreign currency translation | 12,007,000 | (1,032,000) | |
Ending Balance | 835,935,000 | 844,759,000 | |
Reportable Segment [Domain] | |||
Goodwill [Roll Forward] | |||
Beginning Balance | 142,286,000 | 176,686,000 | 142,286,000 |
Acquired goodwill | 0 | 0 | |
Goodwill, Impairment Loss | (16,629,000) | 0 | |
Goodwill, Impairment Loss | 0 | 0 | |
Goodwill, Transfers | 0 | 34,400,000 | |
Foreign currency translation | 0 | 0 | |
Ending Balance | 160,057,000 | 176,686,000 | |
All Other [Domain] | |||
Goodwill [Roll Forward] | |||
Beginning Balance | 229,607,000 | 201,904,000 | 229,607,000 |
Acquired goodwill | 0 | 0 | |
Goodwill, Impairment Loss | 0 | (764,000) | |
Goodwill, Impairment Loss | (3,238,000) | (29,631,000) | |
Goodwill, Transfers | (3,630,000) | 0 | |
Foreign currency translation | 6,085,000 | 2,692,000 | |
Ending Balance | 201,121,000 | 201,904,000 | |
Global Integrated Agencies [Member] | |||
Goodwill [Roll Forward] | |||
Beginning Balance | 364,159,000 | 350,716,000 | 364,159,000 |
Acquired goodwill | 0 | 24,778,000 | |
Goodwill, Impairment Loss | (964,000) | 0 | |
Goodwill, Impairment Loss | 0 | 0 | |
Goodwill, Transfers | 3,630,000 | (34,400,000) | |
Foreign currency translation | 5,689,000 | (3,821,000) | |
Ending Balance | 359,071,000 | 350,716,000 | |
Domestic Creative Agencies [Member] | |||
Goodwill [Roll Forward] | |||
Beginning Balance | 36,671,000 | 36,762,000 | 36,671,000 |
Acquired goodwill | 0 | 0 | |
Goodwill, Impairment Loss | 0 | 0 | |
Goodwill, Impairment Loss | 0 | 0 | |
Goodwill, Transfers | 0 | 0 | |
Foreign currency translation | 218,000 | 91,000 | |
Ending Balance | 36,980,000 | 36,762,000 | |
Specialist Communications [Member] | |||
Goodwill [Roll Forward] | |||
Beginning Balance | $ 97,578,000 | 78,691,000 | 97,578,000 |
Acquired goodwill | 0 | 0 | |
Goodwill, Impairment Loss | 0 | 0 | |
Goodwill, Impairment Loss | 0 | (18,893,000) | |
Goodwill, Transfers | 0 | 0 | |
Foreign currency translation | 15,000 | 6,000 | |
Ending Balance | $ 78,706,000 | $ 78,691,000 |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Intangibles: | ||
Trademarks (indefinite life) | $ 17,780 | $ 17,780 |
Intangible assets, gross | 157,378 | 182,844 |
Less accumulated amortization | (86,773) | (97,773) |
Total intangible assets-net | 70,605 | 85,071 |
Other Intangible Assets | ||
Intangibles: | ||
Intangible assets, gross | 37,273 | 43,656 |
Less accumulated amortization | (13,006) | (17,341) |
Intangible assets, net | 24,267 | 26,315 |
Customer Relationships | ||
Intangibles: | ||
Intangible assets, gross | 102,325 | 121,408 |
Less accumulated amortization | (73,767) | (80,432) |
Intangible assets, net | $ 28,558 | $ 40,976 |
Goodwill and Intangible Asset59
Goodwill and Intangible Assets - Textual (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($)reportable_segment | Sep. 30, 2016USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Goodwill [Line Items] | ||||||
Goodwill, impaired, accumulated impairment loss | $ 98,645,000 | |||||
Goodwill, Impairment Loss | $ 764,000 | $ 17,593,000 | $ 764,000 | |||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 7 years | |||||
Amortization of intangibles | $ 19,601,000 | 24,153,000 | $ 33,352,000 | |||
Goodwill, Impairment Loss | 3,238,000 | 48,524,000 | ||||
Indefinite-lived Intangible Assets [Member] | ||||||
Goodwill [Line Items] | ||||||
Amortization of intangibles | $ 17,125,000 | 21,726,000 | $ 30,024,000 | |||
Customer Relationships | ||||||
Goodwill [Line Items] | ||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 6 years | |||||
Other Intangible Assets | ||||||
Goodwill [Line Items] | ||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 9 years | |||||
All Other [Domain] | ||||||
Goodwill [Line Items] | ||||||
Goodwill, Impairment Loss | $ 0 | 764,000 | ||||
Goodwill, Impairment Loss | $ 3,238,000 | $ 29,631,000 | ||||
Reporting Units Impaired, Annual Goodwill Impairment Test | 2 | |||||
Experiential [Member] | All Other [Domain] | ||||||
Goodwill [Line Items] | ||||||
Reporting Units, Goodwill Impairment Test Performed During Interim Period | reportable_segment | 1 | |||||
Goodwill, Impairment Loss | $ 27,893,000 | |||||
Immaterial [Member] | All Other [Domain] | ||||||
Goodwill [Line Items] | ||||||
Reporting Units, Goodwill Impairment Test Performed During Interim Period | reportable_segment | 1 | |||||
Goodwill, Impairment Loss | $ 1,738,000 | |||||
Strategic Communications [Member] | ||||||
Goodwill [Line Items] | ||||||
Goodwill, Impairment Loss | $ 18,893,000 | |||||
Reporting Units Impaired, Annual Goodwill Impairment Test | 1 |
Goodwill and Intangible Asset60
Goodwill and Intangible Assets - Schedule of Finite-lived Intangible Assets Amortization Expense (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,015 | $ 13,051 |
2,016 | 8,832 |
2,017 | 6,619 |
2,018 | 5,038 |
2,019 | $ 4,520 |
Income Taxes - Schedule of Inc
Income Taxes - Schedule of Income before income tax, Domestic and Foreign (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax [Line Items] | |||
Loss from continuing operations before income taxes, equity in affiliates | $ 87,078 | $ (49,716) | $ (17,416) |
Domestic Tax Authority | |||
Income Tax [Line Items] | |||
Loss from continuing operations before income taxes, equity in affiliates | 48,053 | (16,661) | 23,180 |
Foreign Tax Authority | |||
Income Tax [Line Items] | |||
Loss from continuing operations before income taxes, equity in affiliates | $ 39,025 | $ (33,055) | $ (40,596) |
Income Taxes - Schedule of Com
Income Taxes - Schedule of Components of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax [Line Items] | |||
Current tax provision | $ 4,955 | $ 634 | $ 3,840 |
Deferred tax provision (benefit): | (173,019) | (10,038) | (79) |
Income tax provision (benefit) | (168,064) | (9,404) | 3,761 |
United States Federal | |||
Income Tax [Line Items] | |||
Current tax provision | (1,657) | 0 | 0 |
Deferred tax provision (benefit): | (172,873) | 5,785 | 5,359 |
United States And Local | |||
Income Tax [Line Items] | |||
Current tax provision | 98 | (1,520) | 1,375 |
Deferred tax provision (benefit): | (7,775) | (3,550) | 2,877 |
Foreign | |||
Income Tax [Line Items] | |||
Current tax provision | 6,514 | 2,154 | 2,465 |
Deferred tax provision (benefit): | $ 7,629 | $ (12,273) | $ (8,315) |
Income Taxes - Schedule of Eff
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Income (loss) from continuing operations before income taxes, equity in non-consolidated affiliates and noncontrolling interest | $ 87,078 | $ (49,716) | $ (17,416) |
Statutory income tax rate | 26.50% | 26.50% | 26.50% |
Tax expense (benefit) using statutory income tax rate | $ 23,076 | $ (13,175) | $ (4,615) |
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Amount | 8,863 | (94) | 3,524 |
Non-deductible stock-based compensation | 1,441 | 1,123 | 665 |
Other non-deductible expense | (220) | 1,848 | 163 |
Change to valuation allowance | (103,212) | 6,605 | 3,565 |
Impact of tax reform | 4,463 | (4,579) | 1,906 |
Impact of tax reform | (100,472) | 0 | 0 |
Noncontrolling interests | (4,413) | (1,287) | (2,399) |
Effective Income Tax Rate Reconciliation, Tax Credit, Foreign, Amount | (2,453) | 0 | 0 |
Effective Income Tax Rate Reconciliation, Other Reconciling Items, Amount | 4,863 | 155 | 952 |
Income tax provision (benefit) | $ (168,064) | $ (9,404) | $ 3,761 |
Effective income tax rate | (193.00%) | 18.90% | (21.60%) |
Income Taxes - Schedule of Def
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Capital assets and other | $ 5,059 | $ 6,758 |
Net operating loss carry forwards | 49,318 | 44,305 |
Interest deductions | 2,026 | 12,146 |
Refinancing charge | 5,578 | 7,413 |
Goodwill and intangibles | 129,455 | 179,029 |
Stock compensation | 1,208 | 2,581 |
Pension plan | 4,165 | 5,095 |
Deferred Tax Assets, Unrealized Currency Losses | 8,653 | 15,237 |
Capital loss carry forwards | 11,450 | 10,957 |
Accounting reserves | 412 | 7,138 |
Gross deferred tax asset | 217,324 | 290,659 |
Less: valuation allowance | (19,032) | (248,866) |
Net deferred tax assets | 198,292 | 41,793 |
Deferred tax liabilities: | ||
Deferred finance charges | 0 | (333) |
Capital assets and other | 0 | (388) |
Goodwill amortization | (89,727) | (109,638) |
Total deferred tax liabilities | (89,727) | (110,359) |
Disclosed as: | ||
Deferred tax liabilities (assets), net | 108,565 | 68,566 |
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | 115,325 | 41,793 |
Net Deferred Tax Asset, Gross of Jurisdictional Netting | 41,793 | |
Deferred Tax Liabilities, Net, Noncurrent | $ 6,760 | 110,359 |
Deferred Tax Liability, Gross of Jurisdictional Netting | $ 110,359 |
Income Taxes - Schedule of Cha
Income Taxes - Schedule of Changes in Tax Reserve (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Reserve [Roll Forward] | |||
Beginning Balance | $ 1,465 | $ 3,605 | $ 3,073 |
Charges to income tax expense | 32 | 1,261 | (960) |
Settlement of uncertainty | 879 | 428 | |
Ending Balance | $ 1,433 | $ 1,465 | $ 3,605 |
Income Taxes - Textual (Detail
Income Taxes - Textual (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax [Line Items] | |||||
Tax Cuts and Jobs Act of 2017, Change in Tax Rate, Deferred Tax Asset, Income Tax Expense (Benefit) | $ (26,674) | ||||
Tax Cuts and Jobs Act of 2017, Income Tax Expense (Benefit) | (100,472) | $ 0 | $ 0 | ||
Deferred Other Tax Expense (Benefit) | $ 66,373 | ||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 26.50% | 26.50% | 26.50% | ||
Deferred Tax Benefit (Expense), Valuation Allowance Remeasurement | $ 60,772 | ||||
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Other, Amount | (220) | $ 1,848 | $ 163 | ||
Non-deductible stock-based compensation | 1,441 | 1,123 | 665 | ||
Change to valuation allowance | (103,212) | 6,605 | 3,565 | ||
Impact of tax reform | 4,463 | (4,579) | $ 1,906 | ||
Income taxes receivable | $ 4,582 | $ 1,506 | 4,582 | 1,506 | |
Taxes payable | 3,810 | 4,547 | 3,810 | 4,547 | |
Deferred Tax Assets, Valuation Allowance | 19,032 | 248,866 | $ 19,032 | 248,866 | |
Operating loss carryforwards expiration period | 2017 through 2032 | ||||
Indefinite loss carryforwards | 96,063 | $ 96,063 | |||
Valuation allowance, deferred tax asset, increase (decrease), amount | (226,466) | 925 | 232,632 | ||
Tax Cuts and Jobs Act of 2017, Change in Tax Rate, Deferred Tax Asset Valuation Allowance, Income Tax Increase (Decrease) | (127,146) | ||||
Unrecognized tax benefits | 1,556 | 2 | 1,556 | 2 | |
Unrecognized tax benefits, income tax penalties and interest accrued | 0 | 78 | 0 | 78 | |
United States Federal [Member] | |||||
Income Tax [Line Items] | |||||
Operating loss carryforwards | 29,723 | 29,723 | |||
United States | |||||
Income Tax [Line Items] | |||||
Indefinite loss carryforwards | 9,646 | 9,646 | |||
Foreign Tax Authority | |||||
Income Tax [Line Items] | |||||
Operating loss carryforwards | 116,536 | 116,536 | |||
Canada | |||||
Income Tax [Line Items] | |||||
Indefinite loss carryforwards | $ 86,417 | $ 86,417 | |||
State and Local Jurisdiction [Member] | |||||
Income Tax [Line Items] | |||||
Operating loss carryforwards | $ 119,188 | 119,188 | |||
Utilization of deferred tax asset [Member] | |||||
Income Tax [Line Items] | |||||
Valuation allowance, deferred tax asset, increase (decrease), amount | $ 105,486 |
Discontinued Operations - Text
Discontinued Operations - Textual (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | May 31, 2015 | |
Entity Information [Line Items] | ||||
Goodwill, Impairment Loss | $ 764,000 | $ 17,593,000 | $ 764,000 | |
Disposal Group, Disposed of by Sale, Not Discontinued Operations [Member] | ||||
Entity Information [Line Items] | ||||
Disposal Group, Including Discontinued Operation, Consideration | $ 17,000,000 |
Discontinued Operations - Sche
Discontinued Operations - Schedule of Disposal Groups (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |||
Revenue | $ 27,025 | ||
Operating loss | (322) | ||
Other expense | (752) | ||
Loss on disposal | (5,207) | ||
Net loss from discontinued operations | $ 0 | $ 0 | $ (6,281) |
Debt - Schedule of Debt (Detai
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 23, 2016 | Dec. 31, 2014 | Dec. 31, 2013 | Mar. 20, 2013 |
Debt [Line Items] | ||||||
Debt Issuance Costs, Line of Credit Arrangements, Gross | $ (17,587) | $ (18,420) | ||||
Debt, long-term and short-term, combined amount, total | 882,413 | 936,005 | ||||
Capital Leases, Future Minimum Payments Due | 706 | 431 | ||||
Debt and capital lease obligations | 883,119 | 936,436 | ||||
Less: Current portion | 313 | 228 | ||||
Long-term debt, less current portion | 882,806 | 936,208 | ||||
Six Point Five Zero Percentage Notes [Domain] | ||||||
Debt [Line Items] | ||||||
Senior notes | $ 900,000 | $ 900,000 | ||||
Stated interest rate | 6.50% | 6.50% | ||||
6.75% Notes | ||||||
Debt [Line Items] | ||||||
Stated interest rate | 6.75% | 6.75% | 6.75% | 6.75% | ||
Wells Fargo Capital Finance, Llc [Member] | Revolving Credit Facility [Member] | ||||||
Debt [Line Items] | ||||||
Long-term Line of Credit | $ 0 | $ 54,425 |
Debt - Schedule of Future Prin
Debt - Schedule of Future Principal Repayments (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Debt Disclosure [Abstract] | |
2,015 | $ 313 |
2,016 | 320 |
2,017 | 68 |
2,018 | 5 |
2,019 | 0 |
2023 and thereafter | 900,000 |
Future principal repayments of long term debt including capital lease obligations | $ 900,706 |
Debt - Schedule of Future Mini
Debt - Schedule of Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
2,015 | $ 313 | |
2,016 | 320 | |
2,017 | 68 | |
2,018 | 5 | |
2,019 | 0 | |
2023 and thereafter | 0 | |
Capital leases, future minimum payments due, total | 706 | $ 431 |
Less: imputed interest | (59) | |
Capital leases, future minimum payments, net minimum payments, total | 647 | |
Less: current portion | (313) | |
Capital lease obligations, noncurrent | $ 334 |
Debt - Textual (Details)
Debt - Textual (Details) - USD ($) | May 03, 2016 | Mar. 23, 2016 | Oct. 23, 2014 | Mar. 20, 2013 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | May 01, 2019 | Dec. 31, 2013 |
Debt [Line Items] | ||||||||||
Capital Leases, Future Minimum Payments Due | $ 706,000 | $ 431,000 | ||||||||
Interest expense, debt, total | 62,001,000 | 56,468,000 | $ 53,090,000 | |||||||
Loss on redemption of Notes | 0 | (33,298,000) | 0 | |||||||
Interest expense amortization of debt premium | (312,000) | (1,178,000) | ||||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | (4,819,000) | 8,227,000 | 38,887,000 | |||||||
Amortization of financing costs | 3,022,000 | 3,022,000 | $ 3,448,000 | |||||||
Letters of credit outstanding, amount | 5,056,000 | 5,056,000 | ||||||||
Outstanding Checks | $ 41,989,000 | 80,193,000 | ||||||||
Wells Fargo Capital Finance, LLC | ||||||||||
Debt [Line Items] | ||||||||||
Line of Credit Facility, Description | On March 20, 2013, MDC, Maxxcom Inc. (a subsidiary of MDC) and each of their subsidiaries party thereto entered into an amended and restated, $225 million senior secured revolving credit agreement due 2018 (the Credit Agreement) with Wells Fargo Capital Finance, LLC, as agent, and the lenders from time to time party thereto. Advances under the Credit Agreement will be used for working capital and general corporate purposes, in each case pursuant to the terms of the Credit Agreement. Capitalized terms used in this section and not otherwise defined have the meanings set forth in the Credit Agreement. Advances under the Credit Agreement bear interest as follows: (a)(i) LIBOR Rate Loans bear interest at the LIBOR Rate and (ii) Base Rate Loans bear interest at the Base Rate, plus (b) an applicable margin. The initial applicable margin for borrowing is 1.25% in the case of Base Rate Loans and 2.00% in the case of LIBOR Rate Loans. In addition to paying interest on outstanding principal under the Credit Agreement, MDC is required to pay an unused revolver fee to lenders under the Credit Agreement in respect of unused commitments thereunder. | |||||||||
Debt instrument, maturity date | May 3, 2021 | Sep. 30, 2019 | ||||||||
Six Point Five Zero Percentage Notes [Domain] | ||||||||||
Debt [Line Items] | ||||||||||
Debt instrument, percentage redeemable redemption date, additional | 106.50% | |||||||||
Stated interest rate | 6.50% | 6.50% | ||||||||
Proceeds from issuance of debt | $ 880,000 | |||||||||
Debt instrument, face amount | $ 900,000 | |||||||||
Debt instrument, percentage of redemption price, redemption date one | 104.875% | |||||||||
Debt instrument, redemption date, one | May 1, 2019 | |||||||||
Debt instrument, percentage of redemption price, redemption date two | 103.25% | |||||||||
Debt instrument, redemption date, two | May 1, 2020 | |||||||||
Debt instrument, percentage of redemption price, redemption date, latest for redemption at face amount | 100.00% | |||||||||
Debt Instrument, Redemption Date, Four | May 1, 2022 | |||||||||
Debt instrument, percentage of redemption price, change in ownership control | 101.00% | |||||||||
Debt Instrument, Percentage Of Redemption Price, Redemption Date Three | 101.625% | |||||||||
Debt Instrument, Redemption Date, Three | May 1, 2021 | |||||||||
6.75% Notes | ||||||||||
Debt [Line Items] | ||||||||||
Loss on redemption of Notes | $ 33,298 | |||||||||
Stated interest rate | 6.75% | 6.75% | 6.75% | 6.75% | ||||||
Debt instrument, percentage of redemption price, redemption date one | 103.375% | |||||||||
Revolving Credit Facility [Member] | Wells Fargo Capital Finance, LLC | ||||||||||
Debt [Line Items] | ||||||||||
Long-term Line of Credit | $ 0 | $ 54,425,000 | ||||||||
Line of Credit Facility, Expiration Date | Dec. 31, 2018 | |||||||||
Line of credit facility, increase (decrease) | $ 0 | |||||||||
Maximum borrowing capacity | $ 325,000,000 | $ 0 | ||||||||
Debt Instrument, Basis Spread on Variable Rate, Rate Reduction from Amendment | 25.00% | |||||||||
Revolving Credit Facility [Member] | Wells Fargo Capital Finance, LLC | Base Rate | ||||||||||
Debt [Line Items] | ||||||||||
Stated interest rate | 1.00% | 0.75% | ||||||||
Revolving Credit Facility [Member] | Wells Fargo Capital Finance, LLC | London Interbank Offered Rate (LIBOR) | ||||||||||
Debt [Line Items] | ||||||||||
Stated interest rate | 1.75% | 1.50% | ||||||||
Interest Expense [Member] | Fixed Payment [Member] | ||||||||||
Debt [Line Items] | ||||||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | $ 100,000 | $ 255,000 | $ 2,543,000 | |||||||
Scenario, Forecast [Member] | Optional redemption [Domain] | Six Point Five Zero Percentage Notes [Domain] | ||||||||||
Debt [Line Items] | ||||||||||
Debt Instrument, Redemption Price, Percentage of Principal Amount Redeemed | 35.00% |
Share Capital - Schedule of Sh
Share Capital - Schedule of Share Based Compensation Performance and Time Based (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Employee Stock Option | Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Number outstanding, beginning balance | 90,000 | 97,963 | 86,030 |
Weighted average grant date fair value, beginning balance | $ 20.90 | $ 19.61 | $ 23.14 |
Number outstanding, granted | 0 | 10,000 | 80,000 |
Weighted average grant date fair value, granted | $ 0 | $ 14 | $ 21.76 |
Number outstanding, vested | (90,000) | (17,963) | (68,067) |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | $ 20.90 | $ 10.02 | $ 25.21 |
Number outstanding, forfeited | 0 | 0 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ 0 | $ 0 | $ 0 |
Number outstanding, ending balance | 0 | 90,000 | 97,963 |
Weighted average grant date fair value, ending balance | $ 0 | $ 20.90 | $ 19.61 |
Employee Stock Option | Time Based Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Number outstanding, beginning balance | 740,635 | 774,502 | 916,141 |
Weighted average grant date fair value, beginning balance | $ 16.71 | $ 18.71 | $ 16.36 |
Number outstanding, granted | 358,000 | 392,500 | 191,155 |
Weighted average grant date fair value, granted | $ 8.98 | $ 12.53 | $ 20.42 |
Number outstanding, vested | (277,050) | (380,367) | (297,794) |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | $ 19.62 | $ 16.02 | $ 12.35 |
Number outstanding, forfeited | (36,500) | (46,000) | (35,000) |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ 14.15 | $ 20.39 | $ 21.69 |
Number outstanding, ending balance | 785,085 | 740,635 | 774,502 |
Weighted average grant date fair value, ending balance | $ 12.28 | $ 16.71 | $ 18.71 |
Common Class A | Restricted Stock Units (RSUs) [Member] | |||
Employee Stock Incentive Plan [Line Items] | |||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 1,433,921 |
Share Capital - Schedule of 74
Share Capital - Schedule of Shared Based Compensation, Stock Options (Details) - Employee Stock Option - $ / shares | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Employee Stock Incentive Plan [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 0 | 0 | 0 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Number outstanding, beginning balance | 37,500 | 75,000 | 112,500 | |
Weighted average price per share, beginning balance | $ 5.83 | $ 5.28 | $ 5.70 | |
Number exercisable, beginning balance | 37,500 | 75,000 | 112,500 | |
Weighted average price per share, exercisable, beginning balance | $ 5.83 | $ 5.28 | $ 5.70 | |
Weighted average price per share, vested | $ 0 | $ 0 | $ 0 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 0 | 0 | 0 | |
Number outstanding, granted | 0 | 0 | 0 | |
Weighted average price per share, granted | $ 0 | $ 0 | $ 0 | |
Number outstanding, exercised | (37,500) | (37,500) | (37,500) | |
Weighted average price per share, exercised | $ 5.83 | $ 5.97 | $ 4.72 | |
Number outstanding, expired and cancelled | 0 | 0 | 0 | |
Weighted average price per share, expired and cancelled | $ 0 | $ 0 | $ 0 | |
Number outstanding, ending balance | 0 | 37,500 | 75,000 | |
Weighted average price per share, ending balance | $ 0 | $ 5.83 | $ 5.28 | |
Number exercisable, ending balance | 0 | 37,500 | 75,000 | |
Weighted average price per share, exercisable, ending balance | $ 0 | $ 5.83 | $ 5.28 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | 0 | 0 | 0 |
Share Capital - Schedule of 75
Share Capital - Schedule of Share Based Compensation, Stock Appreciation Rights (Details) - $ / shares | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 01, 2016 | Dec. 31, 2014 | |
Stock Appreciation Rights (SARs) [Member] | |||||
Stock Appreciation Rights [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 327,500 | 0 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $ 6.60 | $ 0 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 0 | 0 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ 0 | $ 0 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 327,500 | 0 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 0 | ||||
Share Based Compensation Arrangements By Share Based Payment Award Options Vests In Period Weighted Average Exercise Price | $ 0 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 327,500 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 6.60 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Stock Appreciation Rights, Outstanding [Roll Forward] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | ||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 0 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | 0 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price | $ 0 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | 0 | ||||
Employee Stock Option | |||||
Stock Appreciation Rights [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 0 | 37,500 | 75,000 | 112,500 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $ 0 | $ 5.83 | $ 5.28 | $ 5.70 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Number | 0 | 37,500 | 75,000 | 112,500 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Exercise Price | $ 0 | $ 5.83 | $ 5.28 | $ 5.70 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 0 | 0 | 0 | 0 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 0 | 0 | 0 | ||
Share Based Compensation Arrangements By Share Based Payment Award Options Vests In Period Weighted Average Exercise Price | $ 0 | $ 0 | $ 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 | 0 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 0 | $ 0 | $ 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Stock Appreciation Rights, Outstanding [Roll Forward] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (37,500) | (37,500) | (37,500) | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | $ 5.83 | $ 5.97 | $ 4.72 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | 0 | 0 | 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period, Weighted Average Exercise Price | $ 0 | $ 0 | $ 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares | 0 | 0 | 0 | ||
Stock Incentive Plan 2016 [Member] | Employee Stock Option | |||||
Stock Appreciation Rights [Line Items] | |||||
Number of shares authorized | 1,500,000 |
Share Capital - Textual (Detai
Share Capital - Textual (Details) | 12 Months Ended | |||||||
Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | Dec. 31, 2003shares | Jun. 01, 2011shares | Jun. 02, 2009shares | May 30, 2008shares | May 26, 2005shares | |
Share Capital [Line Items] | ||||||||
Compensation cost not yet recognized | $ | $ 0 | |||||||
Options, exercises in period, intrinsic value | $ | $ 125,000 | $ 471,000 | $ 471,000 | |||||
Reserved shares | 3,126,254.32 | |||||||
Stock Incentive Plan 2003 | ||||||||
Share Capital [Line Items] | ||||||||
Vested percentage on date of grant | 20.00% | |||||||
Vested percentage on each anniversary date | 20.00% | |||||||
Vested percentage on each of first two years | 20.00% | |||||||
Stock Incentive Plan Maxxcom Privatization [Member] | ||||||||
Share Capital [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 802,440 | |||||||
Employee Stock Incentive Plan | ||||||||
Share Capital [Line Items] | ||||||||
Proceeds from exercise of options | $ | $ 0 | $ 0 | $ 224,000 | |||||
Employee Stock Option | ||||||||
Share Capital [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 | 0 | |||||
Employee Stock Option | Stock Incentive Plan 2005 | ||||||||
Share Capital [Line Items] | ||||||||
Number of shares authorized | 6,750,000 | 3,000,000 | ||||||
Employee Stock Option | Stock Incentive Plan 2005 | Additional Authorized On June 2007 And 2009 | ||||||||
Share Capital [Line Items] | ||||||||
Number of shares authorized | 3,750,000 | |||||||
Employee Stock Option | Stock Incentive Plan 2003 | ||||||||
Share Capital [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 2,836,179 | |||||||
Employee Stock Option | Stock Incentive Plan 2003 | Tranche 1 | ||||||||
Share Capital [Line Items] | ||||||||
Expiration period (years) | 5 years | |||||||
Employee Stock Option | Stock Incentive Plan 2003 | Tranche 2 | ||||||||
Share Capital [Line Items] | ||||||||
Expiration period (years) | 10 years | |||||||
Employee Stock Option | Key Partner Incentive Plan 2008 | ||||||||
Share Capital [Line Items] | ||||||||
Number of shares authorized | 900,000 | |||||||
Employee Stock Option | Stock Incentive Plan 2011 | ||||||||
Share Capital [Line Items] | ||||||||
Number of shares authorized | 3,000,000 | |||||||
Restricted Stock And Restricted Stock Units | ||||||||
Share Capital [Line Items] | ||||||||
Expiration period (years) | 3 years | |||||||
Award vesting period (years) | 3 years | |||||||
Equity instruments other than options, vested in period, fair value | $ | $ 7,316,000 | $ 6,272,000 | $ 5,394,000 | |||||
Tax benefit from compensation expense | $ | 3,500,000 | $ 5,429,000 | $ 4,678,000 | |||||
Restricted stock and restricted unit awards, fair value | $ | 7,655,000 | |||||||
Nonvested awards, compensation not yet recognized, share-based awards other than options | $ | $ 4,696,000 | |||||||
Number of shares available for grant (in shares) | 579,748.32 | |||||||
Stock Appreciation Rights (SARs) | ||||||||
Share Capital [Line Items] | ||||||||
Number of shares available for grant (in shares) | 579,748 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 327,500 | |||||||
Time Based Awards | Employee Stock Option | ||||||||
Share Capital [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 277,050 | 380,367 | 297,794 | |||||
Time Based Awards | Restricted Stock And Restricted Stock Units | ||||||||
Share Capital [Line Items] | ||||||||
Equity instruments other than options, outstanding, weighted average remaining contractual terms | 1 year 7 months 13 days | |||||||
Performance Shares | Employee Stock Option | ||||||||
Share Capital [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 90,000 | 17,963 | 68,067 | |||||
Common Class A | ||||||||
Share Capital [Line Items] | ||||||||
Number of votes per share | 1 | |||||||
Common Class B | ||||||||
Share Capital [Line Items] | ||||||||
Number of votes per share | 20 | |||||||
Preferred Stock [Member] | Series 4 Convertible Preferred Stock [Domain] | ||||||||
Share Capital [Line Items] | ||||||||
Shares, Outstanding | 95,000,000 | 0 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Measurements Measured on a Recurring Basis (Details) - Six Point Five Zero Percentage Notes [Domain] - Fair Value, Inputs, Level 1 - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Liabilities: | ||
Long term debt, carrying amount | $ 900,000 | $ 900,000 |
Long term debt, fair value | $ 904,500 | $ 812,250 |
Fair Value Measurements - Sche
Fair Value Measurements - Schedule of Changes to Deferred Acquisition Consideration (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Other | $ 4,819,000 | $ (8,227,000) | $ (38,887,000) | ||
Contingent Payment [Member] | |||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Other | $ (18,173,000) | $ (9,211,000) | (4,896,000) | (7,972,000) | (36,344,000) |
Contingent Payment [Member] | Fair Value, Inputs, Level 3 | |||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||||
Beginning balance of contingent payments | 224,754,000 | 306,734,000 | |||
Payments | 110,234,000 | 105,169,000 | |||
Additions | 0 | 16,132,000 | |||
Redemption value adjustments | 3,273,000 | 13,930,000 | |||
Other | 0 | (6,412,000) | |||
Foreign translation adjustment | 1,293,000 | (461,000) | |||
Ending balance of contingent payments | $ 119,086,000 | $ 224,754,000 | $ 119,086,000 | $ 224,754,000 | $ 306,734,000 |
Fair Value Measurements - Text
Fair Value Measurements - Textual (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Stock Issued During Period, Value, New Issues | $ 27,852,000 | ||
Stock Issued During Period, Shares, New Issues | 0 | 0 | |
Fixed Payment [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Business Combination, Contingent Consideration, Liability | 3,340,000 | $ 4,810,000 | |
Contingent and fixed payments [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Business Combination, Contingent Consideration, Liability | 122,426,000 | 229,564,000 | |
Common Stock [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Stock Issued During Period, Value, New Issues | $ 28,727,000 | ||
Stock Issued During Period, Shares, New Issues | 3,353,939 | ||
Common Class A | Common Stock [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Stock Issued During Period, Value, New Issues | $ 28,727 | $ 10,458,000 | $ 0 |
Stock Issued During Period, Shares, New Issues | 3,353,939 | 691,559 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information, by Segment (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenue | $ 402,747,000 | $ 375,800,000 | $ 390,532,000 | $ 344,700,000 | $ 390,442,000 | $ 349,254,000 | $ 337,047,000 | $ 309,042,000 | $ 1,513,779,000 | $ 1,385,785,000 | $ 1,326,256,000 |
Cost of services sold | 268,673,000 | 249,418,000 | 267,822,000 | 237,563,000 | 260,193,000 | 235,659,000 | 228,835,000 | 211,446,000 | 1,023,476,000 | 936,133,000 | 879,716,000 |
Office and general expenses | 310,455,000 | 306,251,000 | 322,207,000 | ||||||||
Depreciation and amortization | 43,474,000 | 46,446,000 | 52,223,000 | ||||||||
Goodwill, Impairment Loss | 3,238,000 | 48,524,000 | |||||||||
Operating income | 131,959,000 | 48,431,000 | 72,110,000 | ||||||||
Other Income (Expense): | |||||||||||
Other income, net | 1,346,000 | 414,000 | 7,238,000 | ||||||||
Foreign Currency Transaction Gain (Loss), before Tax | 659 | 10,081 | 18,137,000 | (213,000) | (39,328,000) | ||||||
Interest expense, finance charges, and loss on redemption of notes, net | (64,364,000) | (65,858,000) | (57,436,000) | ||||||||
Gain (Loss) on Repurchase of Debt Instrument | 0 | (33,298,000) | 0 | ||||||||
Income (loss) from continuing operations before income taxes and equity in earnings of non-consolidated affiliates | 87,078,000 | (49,716,000) | (17,416,000) | ||||||||
Income tax benefit | 168,064,000 | 9,404,000 | (3,761,000) | ||||||||
Income (loss) from continuing operations before equity in earnings of non-consolidated affiliates | 255,142,000 | (40,312,000) | (21,177,000) | ||||||||
Equity in losses of non-consolidated affiliates | 2,081,000 | (309,000) | 1,058,000 | ||||||||
Income (loss) from continuing operations | 231,455,000 | 21,984,000 | 13,467,000 | (9,683,000) | 11,144,000 | (31,081,000) | 2,089,000 | (22,773,000) | 257,223,000 | (40,621,000) | (20,119,000) |
Loss from discontinued operations attributable to MDC Partners Inc., net of taxes | 0 | 0 | (6,281,000) | ||||||||
Net loss attributable to MDC Partners Inc. | 257,223,000 | (40,621,000) | (26,400,000) | ||||||||
Capital expenditures from continuing operations | 32,958,000 | 29,432,000 | 23,575,000 | ||||||||
Intangible Assets, Net (Including Goodwill) | 906,540,000 | 929,830,000 | 906,540,000 | 929,830,000 | |||||||
Total assets | 1,698,892,000 | 1,577,378,000 | 1,698,892,000 | 1,577,378,000 | |||||||
Net Income (Loss) Attributable to Noncontrolling Interest | (15,375,000) | (5,218,000) | (9,054,000) | ||||||||
Net income (loss) attributable to MDC Partners Inc. | 222,668,000 | $ 18,493,000 | $ 11,253,000 | $ (10,566,000) | 9,098,000 | $ (32,140,000) | $ 835,000 | $ (23,632,000) | 241,848,000 | (45,839,000) | (35,454,000) |
Share-based Compensation | $ 7,480,000 | $ 5,560,000 | 24,350,000 | 21,003,000 | 17,796,000 | ||||||
Global Integrated Agencies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 786,644,000 | 696,410,000 | 652,987,000 | ||||||||
Depreciation and amortization | 23,800,000 | 21,447,000 | 20,599,000 | ||||||||
Goodwill, Impairment Loss | 0 | 0 | |||||||||
Operating income | 74,902,000 | 58,505,000 | 66,161,000 | ||||||||
Other Income (Expense): | |||||||||||
Capital expenditures from continuing operations | 20,748,000 | 16,439,000 | 17,043,000 | ||||||||
Share-based Compensation | 15,203,000 | 12,141,000 | 6,981,000 | ||||||||
All Other [Domain] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Goodwill, Impairment Loss | 3,238,000 | 29,631,000 | |||||||||
Domestic Creative Agencies [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 90,663,000 | 85,953,000 | 91,658,000 | ||||||||
Depreciation and amortization | 1,434,000 | 1,653,000 | 1,855,000 | ||||||||
Goodwill, Impairment Loss | 0 | 0 | |||||||||
Operating income | 16,977,000 | 16,583,000 | 17,535,000 | ||||||||
Other Income (Expense): | |||||||||||
Capital expenditures from continuing operations | 1,032,000 | 1,055,000 | 1,321,000 | ||||||||
Share-based Compensation | 845,000 | 634,000 | 644,000 | ||||||||
Specialist Communications [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 172,565,000 | 170,285,000 | 153,920,000 | ||||||||
Depreciation and amortization | 4,714,000 | 6,637,000 | 11,201,000 | ||||||||
Goodwill, Impairment Loss | 0 | 18,893,000 | |||||||||
Operating income | 20,714,000 | 1,939,000 | 18,047,000 | ||||||||
Other Income (Expense): | |||||||||||
Capital expenditures from continuing operations | 1,288,000 | 2,741,000 | 1,311,000 | ||||||||
Share-based Compensation | 2,954,000 | 3,629,000 | 1,510,000 | ||||||||
Media Services [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 142,387,000 | 131,498,000 | 132,419,000 | ||||||||
Depreciation and amortization | 3,629,000 | 5,718,000 | 4,660,000 | ||||||||
Goodwill, Impairment Loss | 0 | 0 | |||||||||
Operating income | 12,963,000 | 6,154,000 | 20,116,000 | ||||||||
Other Income (Expense): | |||||||||||
Capital expenditures from continuing operations | 3,035,000 | 5,110,000 | 825,000 | ||||||||
Share-based Compensation | 614,000 | 301,000 | 471,000 | ||||||||
All Other [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenue | 321,520,000 | 301,639,000 | 295,272,000 | ||||||||
Depreciation and amortization | 8,799,000 | 9,406,000 | 12,134,000 | ||||||||
Operating income | 47,259,000 | 9,368,000 | 15,423,000 | ||||||||
Other Income (Expense): | |||||||||||
Capital expenditures from continuing operations | 6,832,000 | 4,054,000 | 2,704,000 | ||||||||
Share-based Compensation | 2,600,000 | 1,773,000 | 5,450,000 | ||||||||
Corporate, Non-Segment [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Depreciation and amortization | 1,098,000 | 1,585,000 | 1,774,000 | ||||||||
Operating income | (40,856,000) | (44,118,000) | (65,172,000) | ||||||||
Other Income (Expense): | |||||||||||
Capital expenditures from continuing operations | 23,000 | 33,000 | 371,000 | ||||||||
Share-based Compensation | $ 2,134,000 | $ 2,525,000 | $ 2,740,000 |
Segment Information - Schedu81
Segment Information - Schedule of Fixed Assets, Goodwill and Intangibles, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||||||||
Long-lived Assets | $ 90,306 | $ 78,377 | $ 90,306 | $ 78,377 | |||||||
Intangible Assets, Net (Including Goodwill) | 906,540 | 929,830 | 906,540 | 929,830 | |||||||
Revenue | 402,747 | $ 375,800 | $ 390,532 | $ 344,700 | 390,442 | $ 349,254 | $ 337,047 | $ 309,042 | 1,513,779 | 1,385,785 | $ 1,326,256 |
United States | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Long-lived Assets | 77,163 | 67,617 | 77,163 | 67,617 | |||||||
Intangible Assets, Net (Including Goodwill) | 706,241 | 736,334 | 706,241 | 736,334 | |||||||
Revenue | 1,172,364 | 1,103,714 | 1,085,051 | ||||||||
Canada | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Long-lived Assets | 5,638 | 5,887 | 5,638 | 5,887 | |||||||
Intangible Assets, Net (Including Goodwill) | 127,014 | 121,987 | 127,014 | 121,987 | |||||||
Revenue | 123,092 | 124,101 | 129,039 | ||||||||
Other Geographical Location | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Long-lived Assets | 7,505 | 4,873 | 7,505 | 4,873 | |||||||
Intangible Assets, Net (Including Goodwill) | $ 73,285 | $ 71,509 | 73,285 | 71,509 | |||||||
Revenue | $ 218,323 | $ 157,970 | $ 112,166 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Director of Operations, Attention Partners [Member] | Total Compensation [Member] | ||
Related Party Transaction [Line Items] | ||
Expenses from transactions with related party | $ 155,000 | $ 145,000 |
Commitments, Contingencies an83
Commitments, Contingencies and Guarantees - Textual (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2017 | |
Temporary Equity [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Redemption Value | $ 60,180,000 | $ 62,886,000 | ||
Letters of credit outstanding, amount | 5,056,000 | 5,056,000 | ||
Operating leases, rent expense | 64,086,000 | $ 56,725,000 | $ 47,583,000 | |
Operating leases, income statement, sublease revenue | 2,797,000 | $ 3,027,000 | $ 1,739,000 | |
Future sublease income receivable | $ 17,369,000 | |||
Contractual redemption right [Member] | ||||
Temporary Equity [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Redemption Value | 15,864,000 | |||
Termination or Death Redemption Right [Member] | ||||
Temporary Equity [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Redemption Value | 41,748,000 | |||
Excess Initial Redemption Value [Member] | ||||
Temporary Equity [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Redemption Value | 5,272,000 | |||
Common Class A | Contractual redemption right [Member] | ||||
Temporary Equity [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Redemption Value | 184,000 | |||
Investments [Member] | ||||
Temporary Equity [Line Items] | ||||
Investment commitments | $ 148,000 | |||
Minimum [Member] | ||||
Temporary Equity [Line Items] | ||||
Redeemable noncontrolling interest obligation, year of payment | 2,017 | |||
Maximum | ||||
Temporary Equity [Line Items] | ||||
Redeemable noncontrolling interest obligation, year of payment | 2,023 | |||
SEC Investigation [Member] | ||||
Temporary Equity [Line Items] | ||||
Civil penalty | $ 1,500 |
Commitments, Contingencies an84
Commitments, Contingencies and Guarantees - Schedule of Future Minimum Rental Payments (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,015 | $ 58,172 |
2,016 | 56,751 |
2,017 | 55,065 |
2,018 | 41,830 |
2,019 | 32,595 |
2023 and thereafter | 122,947 |
Future minimum payments due, total | $ 367,360 |
Employee Benefit Plans - Sched
Employee Benefit Plans - Schedule of Net Periodic Pension Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | ||
Service cost | $ 0 | $ 0 |
Interest cost on benefit obligation | 1,725 | 1,855 |
Expected return on plan assets | (1,830) | (1,863) |
Curtailment and settlements | 0 | 929 |
Amortization of actuarial losses | 222 | 137 |
Net periodic benefit cost | $ 117 | $ 1,058 |
Employee Benefit Plans - Sch86
Employee Benefit Plans - Schedule of Defined Benefit Plan Amounts in Other Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | ||
Curtailment/settlement | $ 0 | $ 0 |
Current year actuarial (gain) loss | 1,558 | 3,238 |
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss), Amortization of Actuarial Gain (Loss), Before Tax | 222 | 137 |
Total recognized in other comprehensive (income) loss | 1,336 | 3,101 |
Total recognized in net periodic benefit cost and other comprehensive (income) loss | $ 1,453 | $ 4,159 |
Employee Benefit Plans - Sch87
Employee Benefit Plans - Schedule of Benefit Obligations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | ||
Liability, Defined Benefit Plan, Noncurrent | $ 15,773 | $ 16,240 |
Change in benefit obligation: | ||
Benefit obligation, Beginning balance | 40,722 | 40,296 |
Service Cost | 0 | 0 |
Interest Cost | 1,725 | 1,855 |
Actuarial losses | 3,088 | 2,502 |
Benefit obligation, Ending balance | 43,750 | 40,722 |
Change in plan assets: | ||
Fair value of plan assets, Beginning balance | 24,482 | 25,190 |
Actual return on plan assets | 3,360 | 198 |
Employer contributions | 1,920 | 3,025 |
Fair value of plan assets, Ending balance | 27,977 | 24,482 |
Defined Benefit Plan, Benefit Obligation, Benefits Paid | 1,785 | 3,931 |
Defined Benefit Plan, Plan Assets, Benefits Paid | $ 1,785 | $ 3,931 |
Employee Benefit Plans - Sch88
Employee Benefit Plans - Schedule of Amounts Recognized in Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Amounts recognized in the balance sheet consist of: | ||
Non-current liability | $ (15,773) | $ (16,240) |
Net amount recognized | $ 15,773 | $ 16,240 |
Employee Benefit Plans - Sch89
Employee Benefit Plans - Schedule of Amounts Recognized in Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Retirement Benefits [Abstract] | ||
Defined Benefit Plan, Accumulated Other Comprehensive Income Net Settlement and Curtailment gain (loss), net of tax | $ (13,656) | $ (12,320) |
Accumulated Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax | $ 13,656 | $ 12,320 |
Employee Benefit Plans - Sch90
Employee Benefit Plans - Schedule of Assumptions Used to Determine Benefit Obligation (Details) | Dec. 31, 2017 | Dec. 31, 2016 |
Retirement Benefits [Abstract] | ||
Discount rate | 3.83% | 4.32% |
Employee Benefit Plans - Sch91
Employee Benefit Plans - Schedule of Assumptions Used to Determine Net Periodic Costs (Details) | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | ||
Discount rate | 4.32% | 4.69% |
Expected return on plan assets | 7.40% | 7.40% |
Employee Benefit Plans - Sch92
Employee Benefit Plans - Schedule of Changes in Fair Value of Plan Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 27,977 | $ 24,482 | $ 25,190 |
Mutual Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 26,282 | 22,795 | |
Money Market Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 1,695 | 1,687 | |
Fair Value, Inputs, Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 27,977 | 24,482 | |
Fair Value, Inputs, Level 1 | Mutual Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 26,282 | 22,795 | |
Fair Value, Inputs, Level 1 | Money Market Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 1,695 | 1,687 | |
Fair Value, Inputs, Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Fair Value, Inputs, Level 2 | Mutual Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Fair Value, Inputs, Level 2 | Money Market Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Fair Value, Inputs, Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Fair Value, Inputs, Level 3 | Mutual Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Fair Value, Inputs, Level 3 | Money Market Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 |
Employee Benefit Plans - Sch93
Employee Benefit Plans - Schedule of Allocation of Plan Assets (Details) | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 100.00% | |
Defined Benefit Plan, Actual Plan Asset Allocations | 100.00% | 100.00% |
Cash and Cash Equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 1.00% | |
Defined Benefit Plan, Actual Plan Asset Allocations | 6.10% | 6.90% |
Equity Securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 68.00% | |
Defined Benefit Plan, Actual Plan Asset Allocations | 68.90% | 65.50% |
Debt Securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Target Allocation | 31.00% | |
Defined Benefit Plan, Actual Plan Asset Allocations | 25.00% | 27.60% |
Employee Benefit Plans - Sch94
Employee Benefit Plans - Schedule of Amounts in Accumulated Other Comprehensive Income (Loss) (Details) - Pension Plan, Defined Benefit $ in Thousands | Dec. 31, 2017USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
Net loss amortization | $ 258 |
Total | $ 258 |
Employee Benefit Plans - Sch95
Employee Benefit Plans - Schedule of Expected Benefit Payments (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Estimated Future Benefit Payments for FYE 12/31 | |
2,015 | $ 1,806 |
2,016 | 1,903 |
2,017 | 2,090 |
2,018 | 2,077 |
2,019 | 2,109 |
2023 – 2027 | $ 12,010 |
Employee Benefit Plans - Textu
Employee Benefit Plans - Textual (Details) | Dec. 31, 2017 |
Defined Benefit Plan Disclosure [Line Items] | |
Target Allocation | 100.00% |
Equity Securities | |
Defined Benefit Plan Disclosure [Line Items] | |
Target Allocation | 50.00% |
Corporate Bonds And US Treasury Securities | |
Defined Benefit Plan Disclosure [Line Items] | |
Target Allocation | 50.00% |
Long-term Investments | |
Defined Benefit Plan Disclosure [Line Items] | |
Target Allocation | 50.00% |
Short-term Investments | |
Defined Benefit Plan Disclosure [Line Items] | |
Target Allocation | 50.00% |
Changes in Accumulated Other 97
Changes in Accumulated Other Comprehensive Income - Schedule of Changes in AOCI(L) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Defined benefit pension, balance January 1 | $ (12,320) | $ (9,219) | |
Foreign currency translation, balance January 1 | 10,496 | 15,476 | |
Total, balance January 1 | (1,824) | 6,257 | |
Other comprehensive income (loss) before reclassifications, defined benefit plan | 0 | 0 | |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax | 1,206 | (4,980) | |
Total, other comprehensive income (loss) before reclassifications | 1,206 | (4,980) | |
Defined benefit pension, amounts reclassified from accumulated other comprehensive income (loss) | (1,336) | (3,101) | |
Foreign currency translation, amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | |
Total, amounts reclassified from accumulated other comprehensive income (loss) | (1,336) | (3,101) | |
Defined benefit pension, other comprehensive income (loss) | (1,336) | (3,101) | $ (423) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Portion Attributable to Parent | 1,206 | (4,980) | |
Total, other comprehensive income (loss) | (130) | (8,081) | |
Defined benefit pension, balance December 31 | (13,656) | (12,320) | (9,219) |
Foreign currency translation, balance December 31 | 11,702 | 10,496 | 15,476 |
Total, balance December 31 | $ (1,954) | $ (1,824) | $ 6,257 |
Quarterly Results of Operatio98
Quarterly Results of Operations - Schedule of Results of Operations (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 402,747 | $ 375,800 | $ 390,532 | $ 344,700 | $ 390,442 | $ 349,254 | $ 337,047 | $ 309,042 | $ 1,513,779 | $ 1,385,785 | $ 1,326,256 |
Cost of services sold | 268,673 | 249,418 | 267,822 | 237,563 | 260,193 | 235,659 | 228,835 | 211,446 | 1,023,476 | 936,133 | 879,716 |
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest | 231,455 | 21,984 | 13,467 | (9,683) | 11,144 | (31,081) | 2,089 | (22,773) | 257,223 | (40,621) | (20,119) |
Net income (loss) attributable to MDC Partners Inc. | $ 222,668 | $ 18,493 | $ 11,253 | $ (10,566) | $ 9,098 | $ (32,140) | $ 835 | $ (23,632) | $ 241,848 | $ (45,839) | $ (35,454) |
Continuing operations (in dollars per share) | $ 3.33 | $ 0.25 | $ 0.14 | $ (0.21) | $ 0.17 | $ (0.62) | $ 0.02 | $ (0.47) | $ 3.72 | $ (0.89) | $ (0.58) |
Net income (loss) (in dollars per share) | 3.33 | 0.25 | 0.14 | (0.21) | 0.17 | (0.62) | 0.02 | (0.47) | 3.72 | (0.89) | (0.71) |
Continuing operations (in dollars per share) | 3.30 | 0.24 | 0.14 | (0.21) | 0.17 | (0.62) | 0.02 | (0.47) | 3.71 | (0.89) | (0.58) |
Net income (loss) (in dollars per share) | $ 3.30 | $ 0.24 | $ 0.14 | $ (0.21) | $ 0.17 | $ (0.62) | $ 0.02 | $ (0.47) | $ 3.71 | $ (0.89) | $ (0.71) |
Quarterly Results of Operatio99
Quarterly Results of Operations - Textual (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Earnings Per Share, Diluted, Pro Forma Adjustment | $ 0.14 | |||||
Foreign exchange loss | $ (659) | $ (10,081) | $ (18,137,000) | $ 213,000 | $ 39,328,000 | |
Cost of services sold | 7,480,000 | 5,560,000 | 24,350,000 | 21,003,000 | 17,796,000 | |
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | (4,819,000) | 8,227,000 | 38,887,000 | |||
Asset Impairment Charges | 4,415,000 | 4,415,000 | 48,524,000 | 0 | ||
Goodwill, Impairment Loss | 3,238,000 | 48,524,000 | ||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | (226,466,000) | 925,000 | 232,632,000 | |||
Contingent Payment [Member] | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability | $ 18,173,000 | 9,211,000 | 4,896,000 | 7,972,000 | $ 36,344,000 | |
All Other [Domain] | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Goodwill, Impairment Loss | $ 3,238,000 | $ 29,631,000 | ||||
Strategic Communications [Member] | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Goodwill, Impairment Loss | $ 18,893,000 | |||||
Experiential and Non-material [Member] | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Goodwill, Impairment Loss | $ 29,631,000 |
VALUATION AND QUALIFYING ACC100
VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Allowance for Doubtful Accounts [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | $ 1,523 | $ 1,306 | $ 1,409 |
Charged to Costs and Expenses | 1,989 | 1,053 | 750 |
Removal of Uncollectible Receivables | (924) | (830) | (799) |
Translation Adjustments Increase (Decrease) | (135) | (6) | (54) |
Balance at the End of Period | 2,453 | 1,523 | 1,306 |
Valuation Allowance of Deferred Tax Assets [Member] | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 248,867 | 247,967 | 175,218 |
Charged to Costs and Expenses | (230,358) | 6,605 | 3,565 |
Other | 4,108 | (6,032) | 73,390 |
Translation Adjustments Increase (Decrease) | (3,585) | 327 | (4,206) |
Balance at the End of Period | $ 19,032 | $ 248,867 | $ 247,967 |
Other Events (Details)
Other Events (Details) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
SEC Investigation [Member] | |
Business Interruption Loss [Line Items] | |
Civil penalty | $ 1,500 |
Subsequent Events (Details)
Subsequent Events (Details) - shares | Dec. 31, 2017 | Dec. 31, 2016 |
Subsequent Event [Line Items] | ||
Preferred Stock, Shares Issued | 0 | 0 |
Convertible Preference Shares (
Convertible Preference Shares (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 07, 2017 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Preferred Units [Line Items] | |||||
Stock Issued During Period, Shares, Convertible Preferred Shares | 90,220,000 | ||||
Accretion on Convertible Preferred Shares | $ (6,352) | $ 0 | $ 0 | ||
Series 4 Convertible Preferred Stock [Domain] | |||||
Preferred Units [Line Items] | |||||
Proceeds from Issuance of Convertible Preferred Stock | $ 95,000 | $ 0 | $ 0 | ||
Preferred Stock [Member] | Series 4 Convertible Preferred Stock [Domain] | |||||
Preferred Units [Line Items] | |||||
Stock Issued During Period, Shares, Convertible Preferred Shares | 95,000 | 95,000,000 | |||
Proceeds from Issuance of Convertible Preferred Stock | $ 95,000 | ||||
Stock Issued During Period, Value, Convertible Preferred Shares | $ 90,220 | $ 90,220 | |||
Preferred Stock, Liquidation Preference Per Share | $ 1,000 | ||||
Preferred Stock, Conversion Price, Preference Per Share | $ 10 | ||||
Preferred Stock, Accretion Percentage, Preference Per Share | 8.00% | ||||
Preferred Stock, Accretion Rate, Preference Per Share | $ 6.97 | ||||
Preferred Stock, Liquidation Preference, Value | $ 101,352 | ||||
Preferred Stock, Conversion Basis, Common Stock Class A Closing Trade Price | 125.00% |
Other Income (Details)
Other Income (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Income (Expense), Excluding Foreign Currenty Transaction Adjustments | $ 162,000 | $ 417,000 | ||||
Gain (Loss) on Disposition of Business | $ (800,000) | (940,000) | ||||
Gain on Sale of Investments | 2,083,000 | 1,932,000 | ||||
Realized Investment Gains (Losses) | 833,000 | (995,000) | ||||
Other income, net | 1,346,000 | 414,000 | $ 7,238,000 | |||
Foreign Currency Transaction Gain (Loss), before Tax | $ 659 | $ 10,081 | 18,137,000 | (213,000) | $ (39,328,000) | |
Other Nonoperating Income | 19,483,000 | $ 201,000 | ||||
Aggregate 2017 Dispositions [Domain] | ||||||
Gain (Loss) on Disposition of Business | $ (1,732,000) |