|
Delaware
|
|
53-0182885
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
1300 North 17th Street, Arlington, Virginia
|
|
22209
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
|
Name of each exchange on which registered
|
Class B Common Stock, par value
$1.00 per share
|
|
New York Stock Exchange
|
Large accelerated
filer
|
ý
|
Accelerated
filer
|
¨
|
Non-accelerated
filer
|
¨
|
Smaller reporting
company
|
¨
|
Emerging growth
company
|
¨
|
|
Item 1.
|
|
Business
|
|
|
|
Education
|
|
|
|
Television Broadcasting
|
|
|
|
Other Activities
|
|
|
|
Competition
|
|
|
|
Executive Officers
|
|
|
|
Employees
|
|
|
|
Forward-Looking Statements
|
|
|
|
Available Information
|
|
Item 1A.
|
|
Risk Factors
|
|
Item 1B.
|
|
Unresolved Staff Comments
|
|
Item 2.
|
|
Properties
|
|
Item 3.
|
|
Legal Proceedings
|
|
Item 4.
|
|
Mine Safety Disclosures
|
|
Item 5.
|
|
Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
|
Item 6.
|
|
Selected Financial Data
|
|
Item 7.
|
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Item 7A.
|
|
Quantitative and Qualitative Disclosures About Market Risk
|
|
Item 8.
|
|
Financial Statements and Supplementary Data
|
|
Item 9.
|
|
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
|
|
Item 9A.
|
|
Controls and Procedures
|
|
Item 9B.
|
|
Other Information
|
|
Item 10.
|
|
Directors, Executive Officers and Corporate Governance
|
|
Item 11.
|
|
Executive Compensation
|
|
Item 12.
|
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
|
Item 13.
|
|
Certain Relationships and Related Transactions, and Director Independence
|
|
Item 14.
|
|
Principal Accounting Fees and Services
|
|
Item 15.
|
|
Exhibits, Financial Statement Schedules
|
|
Item 16.
|
|
Form 10-K Summary
|
|
INDEX TO EXHIBITS
|
|||
SIGNATURES
|
|||
INDEX TO FINANCIAL INFORMATION
|
|||
Management’s Discussion and Analysis of Results of Operations and Financial Condition (Unaudited)
|
|||
Financial Statements:
|
|
||
Report of Independent Registered Public Accounting Firm
|
|||
Consolidated Statements of Operations for the Three Years Ended December 31, 2018
|
|||
Consolidated Statements of Comprehensive Income (Loss) for the Three Years Ended December 31, 2018
|
|||
Consolidated Balance Sheets at December 31, 2018 and 2017
|
|||
Consolidated Statements of Cash Flows for the Three Years Ended December 31, 2018
|
|||
Consolidated Statements of Changes in Common Stockholders’ Equity for the Three Years Ended December 31, 2018
|
|||
Notes to Consolidated Financial Statements
|
|||
Five-Year Summary of Selected Historical Financial Data (Unaudited)
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Kaplan International
|
$
|
719,982
|
|
|
$
|
697,999
|
|
|
$
|
696,362
|
|
Kaplan Higher Education
|
342,085
|
|
|
431,425
|
|
|
501,784
|
|
|||
Kaplan Test Preparation
|
256,102
|
|
|
273,298
|
|
|
286,556
|
|
|||
Kaplan Professional (U.S.)
|
134,187
|
|
|
115,839
|
|
|
115,263
|
|
|||
Kaplan Corporate and Intersegment Eliminations
|
(1,341
|
)
|
|
(1,785
|
)
|
|
(1,504
|
)
|
|||
Total Kaplan Revenue
|
$
|
1,451,015
|
|
|
$
|
1,516,776
|
|
|
$
|
1,598,461
|
|
•
|
The imposition on KHE of fines or repayment obligations for Title IV funds to the ED or the termination or limitation on KHE’s eligibility to provide services as a third-party servicer to Purdue Global or any other Title IV participating institution;
|
•
|
Adverse effects on KHE’s business and results of operations from a reduction or loss in KHE’s revenues under the TOSA or any other agreement with any Title IV participating institution if a client institution loses or has limits placed on its Title IV eligibility, accreditation, operations or state licensure, or is subject to fines, repayment obligations or other adverse actions due to non-compliance by KHE (or the institution) with Title IV, accreditor, federal or state agency requirements;
|
•
|
Liability under the TOSA or any other agreement with any Title IV participating institution for non-compliance with federal, state or accreditation requirements arising from KHE’s conduct; and
|
•
|
Liability for non-compliance with Title IV or other federal or state laws and regulations occurring prior to the transfer of KU to Purdue.
|
Station, Location and
Year Commercial
Operation Commenced
|
|
National
Market
Ranking (a)
|
|
Primary
Network
Affiliation
|
|
Expiration
Date of FCC
License
|
|
Expiration Date
of Network
Agreement
|
|
Total Commercial
Stations
in DMA (b)
|
KPRC, Houston, TX, 1949
|
|
7th
|
|
NBC
|
|
Aug. 1, 2022
|
|
Dec. 31, 2019
|
|
14
|
WDIV, Detroit, MI, 1947
|
|
14th
|
|
NBC
|
|
Oct. 1, 2021
|
|
Dec. 31, 2019
|
|
8
|
WKMG, Orlando, FL, 1954
|
|
18th
|
|
CBS
|
|
Feb. 1, 2021
|
|
April 6, 2019
|
|
11
|
KSAT, San Antonio, TX, 1957
|
|
31st
|
|
ABC
|
|
Aug. 1, 2022
|
|
Dec. 31, 2021
|
|
10
|
WJXT, Jacksonville, FL, 1947
|
|
42nd
|
|
None
|
|
Feb. 1, 2021
|
|
—
|
|
7
|
WCWJ, Jacksonville, FL, 1966
|
|
42nd
|
|
CW
|
|
Feb. 1, 2021
|
|
Aug. 31, 2021
|
|
7
|
WSLS, Roanoke, VA, 1952
|
|
68th
|
|
NBC
|
|
Oct. 1 2020
|
|
Dec. 31, 2019
|
|
7
|
•
|
WSLS: September 6, 2019
|
•
|
WCWJ and WJXT: January 17, 2020
|
•
|
WDIV: March 13, 2020
|
•
|
Failure to Comply With Statutory and Regulatory Requirements as a Service Provider to Title IV Participating Institutions Could Result in Monetary Liabilities or Subject Kaplan to Other Material Adverse Consequences.
|
•
|
The imposition on KHE of fines or repayment obligations for Title IV funds to the ED, or the termination or limitation of Kaplan’s eligibility to provide services as a third-party servicer to Purdue Global or any other Title IV participating institution if KHE fails to comply with statutory or regulatory requirements applicable to such service providers;
|
•
|
Adverse effects on Kaplan’s business and operations from a reduction or loss in KHE’s revenues under the TOSA or any other agreement with any Title IV participating institution if a client institution loses or has limits placed on its Title IV eligibility, accreditation, operations or state licensure, or is subject to fines, repayment obligations or other adverse actions due to non-compliance by KHE (or the institution) with Title IV, accreditor, federal or state agency requirements;
|
•
|
Liability under the TOSA or any other agreement with any Title IV participating institution for non-compliance with federal, state or accreditation requirements arising from conduct by Kaplan; and
|
•
|
Liability for non-compliance with Title IV or other federal or state requirements occurring prior to the transfer of KU to Purdue.
|
•
|
Failure to Comply With the ED’s Title IV Incentive Compensation Rule Could Subject Kaplan to Liabilities, Sanctions and Fines.
|
•
|
Compliance Reviews, Program Review, Audits and Investigations Could Result in Findings of Non- Compliance With Statutory and Regulatory Requirements and Result in Liabilities, Sanctions and Fines.
|
•
|
Non-Compliance With Regulations by KHE’s Client Institutions May Adversely Impact Kaplan’s Results of Operations.
|
•
|
a reduction or loss in KHE’s revenues under the TOSA or other client agreements if Purdue Global or any other KHE client institution loses or has limits placed on its Title IV eligibility, accreditation or state licensure;
|
•
|
a reduction or loss in KHE’s revenues under the TOSA or other client agreements if Purdue Global or any other client institution is subject to fines, repayment obligations or other adverse actions due to non-compliance by Purdue Global (or Kaplan) with Title IV, accreditor or state agency requirements;
|
•
|
the imposition on KHE of fines or repayment obligations to the ED or the termination or limitation on KHE’s eligibility to provide services to Purdue Global or other Title IV participating institutions if findings of non-compliance by Purdue Global or such other institution result in a determination that Kaplan failed to comply with statutory or regulatory requirements applicable to service providers; and
|
•
|
liability under the TOSA or other client agreements for non-compliance with federal, state or accreditation requirements arising from KHE’s conduct.
|
•
|
Changes in the Extent to Which Standardized Tests Are Used in the Admissions Process by Colleges or Graduate Schools Could Reduce Demand for KTP Offerings.
|
•
|
Changes in the Extent to Which Licensing and Proficiency Examinations Are Used to Qualify Individuals to Pursue Certain Careers Could Reduce Demand for Kaplan’s Offerings.
|
•
|
Difficulties of Managing Foreign Operations Could Negatively Affect Kaplan’s Business.
|
•
|
Changes in International Regulatory and Physical Environments and Failure to Comply With Regulations Applicable to International Operations Could Negatively Affect International Student Enrollments and Kaplan’s Business.
|
•
|
Liability Under Real Estate Lease Guaranties for Certain Real Estate Leases That Were Assigned to Education Corporation of America Could Have a Material Adverse Effect on the Company’s Results.
|
•
|
Changes in U.K. Tax Laws Could Have a Material Adverse Effect on KI.
|
•
|
Changing Perceptions About the Effectiveness of Television Broadcasting in Delivering Advertising May Adversely Affect the Profitability of Television Broadcasting.
|
•
|
Increased Competition Resulting From Technological Innovations in News, Information and Video Programming Distribution Systems and Changing Consumer Behavior Could Adversely Affect the Company’s Operating Results.
|
•
|
Changes in the Nature and Extent of Government Regulations Could Adversely Affect the Company’s Television Broadcasting Business and Other Businesses.
|
•
|
Transition
to the New Technical Standard for Broadcast Television Stations May Alter the Competitive Environment in the Company’s Stations’ Markets or Cause the Company to Incur Increased Costs.
|
•
|
Potential Liability for Intellectual Property Infringement Could Adversely Affect the Company’s Businesses.
|
•
|
System Disruptions and Security Threats to the Company’s Information Technology Infrastructure Could Have a Material Adverse Effect on Its Businesses and Results of Operations.
|
•
|
Failure to Comply With Privacy Laws or Regulations Could Have an Adverse Effect on the Company’s Businesses.
|
•
|
Extensive Regulation of the Healthcare Industry Could Adversely Affect the Company’s Healthcare Businesses and Results of Operations.
|
•
|
Failure to Comply With Environmental, Health, Safety and Other Laws Applicable to The Company’s Manufacturing Operations Could Negatively Impact the Company
’
s Business.
|
•
|
The Company May Be Subject to Liability Claims That Could Have a Material Adverse Effect on Its Business.
|
•
|
Failure to Successfully Integrate Acquired Businesses Could Negatively Affect the Company’s Business.
|
•
|
The Spin-Off of Cable ONE Could Result in Significant Tax Liability to the Company and Its Stockholders.
|
|
Number of Securities
to Be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights
|
|
Weighted Average
Exercise Price of
Outstanding Options,
Warrants and Rights
|
|
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))
|
Plan Category
|
(a)
|
|
(b)
|
|
(c)
|
Equity compensation plans approved by security holders
|
184,932
|
|
$566.55
|
|
—
|
Equity compensation plans not approved by security holders
|
—
|
|
—
|
|
—
|
Total
|
184,932
|
|
$566.55
|
|
—
|
Period
|
Total Number
of Shares
Purchased
|
|
Average
Price Paid
per Share
|
|
Total Number of Shares
Purchased as Part of
Publicly Announced Plan*
|
|
Maximum Number of Shares That May Yet Be Purchased Under the Plan*
|
|||||
2018
|
|
|
|
|
|
|
|
|||||
October
|
11,570
|
|
|
$
|
579.44
|
|
|
11,570
|
|
|
274,455
|
|
November
|
800
|
|
|
596.31
|
|
|
800
|
|
|
273,655
|
|
|
December
|
—
|
|
|
—
|
|
|
—
|
|
|
273,655
|
|
|
Total
|
12,370
|
|
|
$
|
580.53
|
|
|
12,370
|
|
|
|
December 31
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
||||||
Graham Holdings Company
|
100.00
|
|
|
132.20
|
|
|
124.23
|
|
|
132.48
|
|
|
145.79
|
|
|
168.80
|
|
S&P 500 Index
|
100.00
|
|
|
113.69
|
|
|
115.26
|
|
|
129.05
|
|
|
157.22
|
|
|
150.33
|
|
Composite Peer Group
|
100.00
|
|
|
91.93
|
|
|
73.21
|
|
|
80.79
|
|
|
114.50
|
|
|
106.19
|
|
Education Peer Group
|
100.00
|
|
|
114.14
|
|
|
76.33
|
|
|
107.82
|
|
|
137.50
|
|
|
152.09
|
|
Exhibit Number
|
|
Description
|
|
|
|
2.1
|
|
|
3.1
|
|
|
3.2
|
|
|
3.3
|
|
|
4.1
|
|
|
10.1
|
|
|
10.2
|
|
|
10.3
|
|
|
10.4
|
|
|
10.5
|
|
|
10.6
|
|
|
10.7
|
|
|
10.8
|
|
|
10.9
|
|
|
10.10
|
|
|
10.11
|
|
|
21
|
|
|
23
|
|
|
24
|
|
|
31.1
|
|
|
31.2
|
|
|
32
|
|
Exhibit Number
|
|
Description
|
|
|
|
101
|
|
The following financial information from Graham Holdings Company Annual Report on Form 10-K for the year ended December 31, 2018, formatted in Extensible Business Reporting Language (XBRL): (i) Consolidated Statements of Operations for the years ended December 31, 2018, 2017 and 2016; (ii) Consolidated Statements of Comprehensive Income for the years ended December 31, 2018, 2017 and 2016; (iii) Consolidated Balance Sheets as of December 31, 2018 and 2017; (iv) Consolidated Statements of Cash Flows for the years ended December 31, 2018, 2017 and 2016; (v) Consolidated Statements of Changes in Common Shareholders’ Equity for the years ended December 31, 2018, 2017 and 2016; and (vi) Notes to Consolidated Financial Statements. Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed “furnished” and not “filed” or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed “furnished” and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability under these sections.
|
|
|
GRAHAM HOLDINGS COMPANY
|
|
|
(Registrant)
|
|
|
|
|
By
|
/s/ Wallace R. Cooney
|
|
|
Wallace R. Cooney
|
|
|
Senior Vice President–Finance
|
|
By
|
/s/ Wallace R. Cooney
|
|
|
Wallace R. Cooney
|
|
|
Attorney-in-Fact
|
Management’s Discussion and Analysis of Results of Operations and Financial Condition (Unaudited)
|
|
|
|
Financial Statements:
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
|
Consolidated Statements of Operations for the Three Years Ended December 31, 2018
|
|
|
|
Consolidated Statements of Comprehensive Income (Loss) for the Three Years Ended December 31, 2018
|
|
|
|
Consolidated Balance Sheets at December 31, 2018 and 2017
|
|
|
|
Consolidated Statements of Cash Flows for the Three Years Ended December 31, 2018
|
|
|
|
Consolidated Statements of Changes in Common Stockholders’ Equity for the Three Years Ended December 31, 2018
|
|
|
|
Notes to Consolidated Financial Statements
|
|
|
|
Five-Year Summary of Selected Historical Financial Data (Unaudited)
|
•
|
a
$7.9 million
intangible asset impairment charge at the healthcare business (after-tax impact of
$5.8 million
, or
$1.08
per share);
|
•
|
a
$3.9 million
reduction to operating expenses from property, plant and equipment gains in connection with the spectrum repacking mandate of the
Federal Communications Commission (FCC)
(after-tax impact of
$3.0 million
, or
$0.55
per share);
|
•
|
$6.2 million
in interest expense related to the settlement of a mandatorily redeemable noncontrolling interest (
$1.14
per share);
|
•
|
$11.4 million
in debt extinguishment costs (after-tax impact of
$8.6 million
, or
$1.60
per share);
|
•
|
a
$30.3 million
settlement gain related to a bulk lump sum pension offering and curtailment gain related to changes in the Company’s postretirement healthcare benefit plan (after-tax amount of
$22.2 million
, or
$4.11
per share);
|
•
|
$15.8 million
in net losses on marketable equity securities (after-tax impact of
$12.6 million
, or
$2.33
per share);
|
•
|
non-operating gain, net, of
$6.7 million
from sales, write-ups and impairments of cost method and equity method investments, and related to sales of land and businesses, including guarantor lease obligations (after-tax impact of
$5.7 million
, or
$1.03
per share);
|
•
|
a
$4.3 million
gain on the Kaplan University Transaction (after-tax impact of
$1.8 million
or
$0.33
per share);
|
•
|
$3.8 million
in non-operating foreign currency losses (after-tax impact of
$2.9 million
, or
$0.54
per share);
|
•
|
a nonrecurring discrete
$17.8 million
deferred state tax benefit related to the release of valuation allowances (
$3.31
per share); and
|
•
|
$1.8 million
in income tax benefits related to stock compensation (
$0.33
per share).
|
•
|
$10.0 million
in restructuring and non-operating Separation Incentive Program charges at the education division (after-tax impact of
$6.3 million
, or
$1.12
per share
);
|
•
|
a
$9.2 million
goodwill and other long-lived asset impairment charge at one of the manufacturing businesses (after-tax impact of
$5.8 million
,
or $1.03
per share);
|
•
|
$3.3 million
in non-operating foreign currency gains (after-tax impact of
$2.1 million
or
$0.37
per share);
|
•
|
$177.5 million
in
net deferred tax benefits related to the enactment of the Tax Cuts and Jobs Act in December 2017 (
$31.68
per share); and
|
•
|
$5.9 million
in income tax benefits related to stock compensation (
$1.06
per share).
|
|
Year Ended December 31
|
|
|
|||||||
(in thousands)
|
2018
|
|
2017
|
|
% Change
|
|||||
Revenue
|
|
|
|
|
|
|||||
Kaplan international
|
$
|
719,982
|
|
|
$
|
697,999
|
|
|
3
|
|
Higher education
|
342,085
|
|
|
431,425
|
|
|
(21
|
)
|
||
Test preparation
|
256,102
|
|
|
273,298
|
|
|
(6
|
)
|
||
Professional (U.S.)
|
134,187
|
|
|
115,839
|
|
|
16
|
|
||
Kaplan corporate and other
|
1,142
|
|
|
294
|
|
|
—
|
|
||
Intersegment elimination
|
(2,483
|
)
|
|
(2,079
|
)
|
|
—
|
|
||
|
$
|
1,451,015
|
|
|
$
|
1,516,776
|
|
|
(4
|
)
|
Operating Income (Loss)
|
|
|
|
|
|
|
|
|
||
Kaplan international
|
$
|
70,315
|
|
|
$
|
51,623
|
|
|
36
|
|
Higher education
|
15,217
|
|
|
16,719
|
|
|
(9
|
)
|
||
Test preparation
|
19,096
|
|
|
11,507
|
|
|
66
|
|
||
Professional (U.S.)
|
28,608
|
|
|
27,558
|
|
|
4
|
|
||
Kaplan corporate and other
|
(26,702
|
)
|
|
(24,701
|
)
|
|
(8
|
)
|
||
Amortization of intangible assets
|
(9,362
|
)
|
|
(5,162
|
)
|
|
(81
|
)
|
||
Intersegment elimination
|
(36
|
)
|
|
143
|
|
|
—
|
|
||
|
$
|
97,136
|
|
|
$
|
77,687
|
|
|
25
|
|
|
|
Year Ended December 31
|
|
%
|
|||||||
(in thousands)
|
|
2018
|
|
2017
|
|
Change
|
|||||
Operating Revenues
|
|
|
|
|
|
|
|||||
Manufacturing
|
|
$
|
487,619
|
|
|
$
|
414,193
|
|
|
18
|
|
SocialCode
|
|
58,728
|
|
|
62,077
|
|
|
(5
|
)
|
||
Other
|
|
43,880
|
|
|
34,733
|
|
|
26
|
|
||
|
|
$
|
590,227
|
|
|
$
|
511,003
|
|
|
16
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
||
Manufacturing
|
|
$
|
458,768
|
|
|
$
|
399,246
|
|
|
15
|
|
SocialCode
|
|
59,809
|
|
|
65,751
|
|
|
(9
|
)
|
||
Other
|
|
71,896
|
|
|
65,269
|
|
|
10
|
|
||
|
|
$
|
590,473
|
|
|
$
|
530,266
|
|
|
11
|
|
Operating Income (Loss)
|
|
|
|
|
|
|
|
|
|
||
Manufacturing
|
|
$
|
28,851
|
|
|
$
|
14,947
|
|
|
93
|
|
SocialCode
|
|
(1,081
|
)
|
|
(3,674
|
)
|
|
71
|
|
||
Other
|
|
(28,016
|
)
|
|
(30,536
|
)
|
|
8
|
|
||
|
|
$
|
(246
|
)
|
|
$
|
(19,263
|
)
|
|
99
|
|
Depreciation
|
|
|
|
|
|
|
|||||
Manufacturing
|
|
$
|
9,515
|
|
|
$
|
9,173
|
|
|
4
|
|
SocialCode
|
|
797
|
|
|
1,004
|
|
|
(21
|
)
|
||
Other
|
|
1,523
|
|
|
1,546
|
|
|
(1
|
)
|
||
|
|
$
|
11,835
|
|
|
$
|
11,723
|
|
|
1
|
|
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets
|
|
|
|
|
|
|
|||||
Manufacturing
|
|
$
|
24,746
|
|
|
$
|
31,052
|
|
|
(20
|
)
|
SocialCode
|
|
928
|
|
|
333
|
|
|
—
|
|
||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
||
|
|
$
|
25,674
|
|
|
$
|
31,385
|
|
|
(18
|
)
|
Pension Expense
|
|
|
|
|
|
|
|
|
|
||
Manufacturing
|
|
$
|
72
|
|
|
$
|
79
|
|
|
(9
|
)
|
SocialCode
|
|
723
|
|
|
593
|
|
|
22
|
|
||
Other
|
|
578
|
|
|
453
|
|
|
28
|
|
||
|
|
$
|
1,373
|
|
|
$
|
1,125
|
|
|
22
|
|
•
|
$10.0 million
in restructuring and non-operating Separation Incentive Program charges at the education division (after-tax impact of
$6.3 million
, or
$1.12
per share);
|
•
|
a
$9.2 million
goodwill and other long-lived asset impairment charge at one of the manufacturing businesses (after-tax impact of
$5.8 million
, or
$1.03
per share);
|
•
|
$3.3 million
in non-operating foreign currency gains (after-tax impact of
$2.1 million
, or
$0.37
per share);
|
•
|
$177.5 million
in net deferred tax benefits related to the enactment of the Tax Cuts and Jobs Act in December 2017 (
$31.68
per share); and
|
•
|
$5.9 million
in income tax benefits related to stock compensation (
$1.06
per share).
|
•
|
$11.9 million
in restructuring charges at the education division (after-tax impact of
$7.7 million
, or
$1.36
per share);
|
•
|
an
$18.0 million
non-operating gain related to a bulk lump sum pension program offering (after-tax impact of
$10.8 million
, or
$1.92
per share);
|
•
|
$16.8 million in net non-operating gains from the sales of assets and write-downs of cost and equity method investments (after-tax impact of $9.5 million, or $1.62 per share);
|
•
|
$39.9 million
in non-operating foreign currency losses (after-tax impact of
$25.5 million
, or
$4.51
per share); and
|
•
|
a net nonrecurring
$13.9 million
deferred tax benefit related to Kaplan (
$2.47
per share).
|
|
Year Ended December 31
|
|
|
|||||||
(in thousands)
|
2017
|
|
2016
|
|
% Change
|
|||||
Revenue
|
|
|
|
|
|
|||||
Kaplan international
|
$
|
697,999
|
|
|
$
|
696,362
|
|
|
—
|
|
Higher education
|
431,425
|
|
|
501,784
|
|
|
(14
|
)
|
||
Test preparation
|
273,298
|
|
|
286,556
|
|
|
(5
|
)
|
||
Professional (U.S.)
|
115,839
|
|
|
115,263
|
|
|
—
|
|
||
Kaplan corporate and other
|
294
|
|
|
214
|
|
|
37
|
|
||
Intersegment elimination
|
(2,079
|
)
|
|
(1,718
|
)
|
|
—
|
|
||
|
$
|
1,516,776
|
|
|
$
|
1,598,461
|
|
|
(5
|
)
|
Operating Income (Loss)
|
|
|
|
|
|
|
|
|
||
Kaplan international
|
$
|
51,623
|
|
|
$
|
48,398
|
|
|
7
|
|
Higher education
|
16,719
|
|
|
39,196
|
|
|
(57
|
)
|
||
Test preparation
|
11,507
|
|
|
9,599
|
|
|
20
|
|
||
Professional (U.S.)
|
27,558
|
|
|
27,436
|
|
|
—
|
|
||
Kaplan corporate and other
|
(24,701
|
)
|
|
(21,763
|
)
|
|
(13
|
)
|
||
Amortization of intangible assets
|
(5,162
|
)
|
|
(7,516
|
)
|
|
31
|
|
||
Intersegment elimination
|
143
|
|
|
(29
|
)
|
|
—
|
|
||
|
$
|
77,687
|
|
|
$
|
95,321
|
|
|
(18
|
)
|
|
|
Year Ended December 31
|
|
%
|
|||||||
(in thousands)
|
|
2017
|
|
2016
|
|
Change
|
|||||
Operating Revenues
|
|
|
|
|
|
|
|||||
Manufacturing
|
|
$
|
414,193
|
|
|
$
|
241,604
|
|
|
71
|
|
SocialCode
|
|
62,077
|
|
|
58,851
|
|
|
5
|
|
||
Other
|
|
34,733
|
|
|
26,433
|
|
|
31
|
|
||
|
|
$
|
511,003
|
|
|
$
|
326,888
|
|
|
56
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
||
Manufacturing
|
|
$
|
399,246
|
|
|
$
|
228,887
|
|
|
74
|
|
SocialCode
|
|
65,751
|
|
|
71,258
|
|
|
(8
|
)
|
||
Other
|
|
65,269
|
|
|
51,644
|
|
|
26
|
|
||
|
|
$
|
530,266
|
|
|
$
|
351,789
|
|
|
51
|
|
Operating Income (Loss)
|
|
|
|
|
|
|
|
|
|
||
Manufacturing
|
|
$
|
14,947
|
|
|
$
|
12,717
|
|
|
18
|
|
SocialCode
|
|
(3,674
|
)
|
|
(12,407
|
)
|
|
70
|
|
||
Other
|
|
(30,536
|
)
|
|
(25,211
|
)
|
|
(21
|
)
|
||
|
|
$
|
(19,263
|
)
|
|
$
|
(24,901
|
)
|
|
23
|
|
Depreciation
|
|
|
|
|
|
|
|||||
Manufacturing
|
|
$
|
9,173
|
|
|
$
|
7,251
|
|
|
27
|
|
SocialCode
|
|
1,004
|
|
|
929
|
|
|
8
|
|
||
Other
|
|
1,546
|
|
|
1,390
|
|
|
11
|
|
||
|
|
$
|
11,723
|
|
|
$
|
9,570
|
|
|
22
|
|
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets
|
|
|
|
|
|
|
|||||
Manufacturing
|
|
$
|
31,052
|
|
|
$
|
12,119
|
|
|
—
|
|
SocialCode
|
|
333
|
|
|
—
|
|
|
—
|
|
||
Other
|
|
—
|
|
|
1,687
|
|
|
—
|
|
||
|
|
$
|
31,385
|
|
|
$
|
13,806
|
|
|
—
|
|
Pension Service Cost
|
|
|
|
|
|
|
|
|
|
||
Manufacturing
|
|
$
|
79
|
|
|
$
|
86
|
|
|
(8
|
)
|
SocialCode
|
|
593
|
|
|
541
|
|
|
10
|
|
||
Other
|
|
453
|
|
|
491
|
|
|
(8
|
)
|
||
|
|
$
|
1,125
|
|
|
$
|
1,118
|
|
|
1
|
|
|
Moody’s
|
|
Standard & Poor’s
|
Long-term
|
Ba1
|
|
BB+
|
(in thousands)
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
|
Total
|
||||||||||||||
Debt and interest
|
$
|
30,957
|
|
|
$
|
100,028
|
|
|
$
|
23,014
|
|
|
$
|
23,015
|
|
|
$
|
23,015
|
|
|
$
|
457,531
|
|
|
$
|
657,560
|
|
Operating leases
|
101,009
|
|
|
84,945
|
|
|
72,031
|
|
|
53,709
|
|
|
47,091
|
|
|
115,948
|
|
|
474,733
|
|
|||||||
Programming purchase commitments
(1)
|
9,116
|
|
|
6,041
|
|
|
452
|
|
|
297
|
|
|
157
|
|
|
—
|
|
|
16,063
|
|
|||||||
Other purchase obligations
(2)
|
72,245
|
|
|
28,154
|
|
|
13,347
|
|
|
4,844
|
|
|
2,034
|
|
|
1,424
|
|
|
122,048
|
|
|||||||
Long-term liabilities
(3)
|
3,692
|
|
|
3,497
|
|
|
3,297
|
|
|
3,211
|
|
|
3,013
|
|
|
16,986
|
|
|
33,696
|
|
|||||||
Total
|
$
|
217,019
|
|
|
$
|
222,665
|
|
|
$
|
112,141
|
|
|
$
|
85,076
|
|
|
$
|
75,310
|
|
|
$
|
591,889
|
|
|
$
|
1,304,100
|
|
(1)
|
Includes commitments for the Company’s television broadcasting business that are reflected in the Company’s Consolidated Financial Statements and commitments to purchase programming to be produced in future years.
|
(2)
|
Includes purchase obligations related to employment agreements, capital projects and other legally binding commitments. Other purchase orders made in the ordinary course of business are excluded from the table above. Any amounts for which the Company is liable under purchase orders are reflected in the Company’s Consolidated Balance Sheets as accounts payable and accrued liabilities.
|
(3)
|
Primarily made up of multiemployer pension plan withdrawal obligations and postretirement benefit obligations other than pensions. The Company has other long-term liabilities excluded from the table above, including obligations for deferred compensation, long-term incentive plans and long-term deferred revenue.
|
|
As of December 31
|
||||||
(in millions)
|
2018
|
|
2017
|
||||
Goodwill and indefinite-lived intangible assets
|
$
|
1,396.8
|
|
|
$
|
1,401.9
|
|
Total assets
|
$
|
4,764.0
|
|
|
$
|
4,937.8
|
|
Percentage of goodwill and indefinite-lived intangible assets to total assets
|
29
|
%
|
|
28
|
%
|
(in millions)
|
Goodwill
|
||
Education
|
|
||
Kaplan international
|
$
|
583.4
|
|
Higher education
|
63.2
|
|
|
Test preparation
|
64.7
|
|
|
Professional (U.S.)
|
86.2
|
|
|
Television broadcasting
|
190.8
|
|
|
Healthcare
|
69.6
|
|
|
Hoover
|
91.3
|
|
|
Total
|
$
|
1,149.2
|
|
•
|
Expected cash flows underlying the Company’s business plans for the periods
2019
through
2023
were used. The expected cash flows took into account historical growth rates, the effect of the changed economic outlook at the Company’s businesses, industry challenges and an estimate for the possible impact of any applicable regulations.
|
•
|
Cash flows beyond
2023
were projected to grow at a long-term growth rate, which the Company estimated between 1.5% and 3% for each reporting unit.
|
•
|
The Company used a discount rate of 9.5% to 21.5% to risk adjust the cash flow projections in determining the estimated fair value.
|
•
|
Expected return on assets – A
1%
increase or decrease to the Company’s assumed expected return on plan assets would have increased or decreased the pension credit by approximately $20.8 million.
|
•
|
Discount rate – A
1%
decrease to the Company’s assumed discount rate would have decreased the pension credit by approximately $2.4 million. A
1%
increase to the Company’s assumed discount rate would have decreased the pension credit by approximately $24.6 million.
|
•
|
Asset returns that are more or less than the expected return on plan assets for the year;
|
•
|
Actual participant demographic experience different from assumed (retirements, terminations and deaths during the year);
|
•
|
Actual salary increases different from assumed; and
|
•
|
Any changes in assumptions that are made to better reflect anticipated experience of the plan or to reflect current market conditions on the measurement date (discount rate, longevity increases, changes in expected participant behavior and expected return on plan assets).
|
|
Year Ended December 31
|
||||||||||
(in thousands, except per share amounts)
|
2018
|
|
2017
|
|
2016
|
||||||
Operating Revenues
|
$
|
2,695,966
|
|
|
$
|
2,591,846
|
|
|
$
|
2,481,890
|
|
Operating Costs and Expenses
|
|
|
|
|
|
||||||
Operating
|
1,687,432
|
|
|
1,454,343
|
|
|
1,270,030
|
|
|||
Selling, general and administrative
|
650,128
|
|
|
887,790
|
|
|
896,097
|
|
|||
Depreciation of property, plant and equipment
|
56,722
|
|
|
62,509
|
|
|
64,620
|
|
|||
Amortization of intangible assets
|
47,414
|
|
|
41,187
|
|
|
26,671
|
|
|||
Impairment of goodwill and other long-lived assets
|
8,109
|
|
|
9,614
|
|
|
1,603
|
|
|||
|
2,449,805
|
|
|
2,455,443
|
|
|
2,259,021
|
|
|||
Income from Operations
|
246,161
|
|
|
136,403
|
|
|
222,869
|
|
|||
Equity in earnings (losses) of affiliates, net
|
14,473
|
|
|
(3,249
|
)
|
|
(7,937
|
)
|
|||
Interest income
|
5,353
|
|
|
6,581
|
|
|
3,093
|
|
|||
Interest expense
|
(37,902
|
)
|
|
(33,886
|
)
|
|
(35,390
|
)
|
|||
Debt extinguishment costs
|
(11,378
|
)
|
|
—
|
|
|
—
|
|
|||
Non-operating pension and postretirement benefit income, net
|
120,541
|
|
|
72,699
|
|
|
80,665
|
|
|||
Loss on marketable equity securities, net
|
(15,843
|
)
|
|
—
|
|
|
—
|
|
|||
Other income (expense), net
|
2,103
|
|
|
4,241
|
|
|
(12,642
|
)
|
|||
Income Before Income Taxes
|
323,508
|
|
|
182,789
|
|
|
250,658
|
|
|||
Provision for (Benefit from) Income Taxes
|
52,100
|
|
|
(119,700
|
)
|
|
81,200
|
|
|||
Net Income
|
271,408
|
|
|
302,489
|
|
|
169,458
|
|
|||
Net Income Attributable to Noncontrolling Interests
|
(202
|
)
|
|
(445
|
)
|
|
(868
|
)
|
|||
Net Income Attributable to Graham Holdings Company Common Stockholders
|
$
|
271,206
|
|
|
$
|
302,044
|
|
|
$
|
168,590
|
|
Per Share Information Attributable to Graham Holdings Company Common Stockholders
|
|
|
|
|
|
||||||
Basic net income per common share
|
$
|
50.55
|
|
|
$
|
54.24
|
|
|
$
|
29.95
|
|
Basic average number of common shares outstanding
|
5,333
|
|
|
5,516
|
|
|
5,559
|
|
|||
Diluted net income per common share
|
$
|
50.20
|
|
|
$
|
53.89
|
|
|
$
|
29.80
|
|
Diluted average number of common shares outstanding
|
5,370
|
|
|
5,552
|
|
|
5,589
|
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Net Income
|
$
|
271,408
|
|
|
$
|
302,489
|
|
|
$
|
169,458
|
|
Other Comprehensive (Loss) Income, Before Tax
|
|
|
|
|
|
||||||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the year
|
(35,584
|
)
|
|
33,175
|
|
|
(22,149
|
)
|
|||
Adjustment for sales of businesses with foreign operations
|
—
|
|
|
137
|
|
|
—
|
|
|||
|
(35,584
|
)
|
|
33,312
|
|
|
(22,149
|
)
|
|||
Unrealized gains on available-for-sale securities:
|
|
|
|
|
|
||||||
Unrealized gains for the year
|
—
|
|
|
112,086
|
|
|
55,507
|
|
|||
Reclassification adjustment for realization of loss on sale of available-for-sale securities included in net income
|
—
|
|
|
—
|
|
|
1,879
|
|
|||
|
—
|
|
|
112,086
|
|
|
57,386
|
|
|||
Pension and other postretirement plans:
|
|
|
|
|
|
||||||
Actuarial (loss) gain
|
(101,013
|
)
|
|
179,674
|
|
|
(133,915
|
)
|
|||
Prior service credit (cost)
|
4,262
|
|
|
(75
|
)
|
|
—
|
|
|||
Amortization of net actuarial (gain) loss included in net income
|
(11,349
|
)
|
|
(6,527
|
)
|
|
1,157
|
|
|||
Amortization of net prior service (credit) cost included in net income
|
(947
|
)
|
|
477
|
|
|
419
|
|
|||
Curtailments and settlements included in net income
|
(30,267
|
)
|
|
—
|
|
|
(17,993
|
)
|
|||
|
(139,314
|
)
|
|
173,549
|
|
|
(150,332
|
)
|
|||
Cash flow hedge gain (loss)
|
551
|
|
|
112
|
|
|
(334
|
)
|
|||
Other Comprehensive (Loss) Income, Before Tax
|
(174,347
|
)
|
|
319,059
|
|
|
(115,429
|
)
|
|||
Income tax benefit (expense) related to items of other comprehensive (loss) income
|
37,510
|
|
|
(90,923
|
)
|
|
37,235
|
|
|||
Other Comprehensive (Loss) Income, Net of Tax
|
(136,837
|
)
|
|
228,136
|
|
|
(78,194
|
)
|
|||
Comprehensive Income
|
134,571
|
|
|
530,625
|
|
|
91,264
|
|
|||
Comprehensive income attributable to noncontrolling interests
|
(202
|
)
|
|
(445
|
)
|
|
(868
|
)
|
|||
Total Comprehensive Income Attributable to Graham Holdings Company
|
$
|
134,369
|
|
|
$
|
530,180
|
|
|
$
|
90,396
|
|
|
As of December 31
|
||||||
(In thousands, except share amounts)
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
||||
Current Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
253,256
|
|
|
$
|
390,014
|
|
Restricted cash
|
10,859
|
|
|
17,552
|
|
||
Investments in marketable equity securities and other investments
|
514,581
|
|
|
557,153
|
|
||
Accounts receivable, net
|
582,280
|
|
|
620,319
|
|
||
Income taxes receivable
|
19,166
|
|
|
23,901
|
|
||
Inventories and contracts in progress
|
69,477
|
|
|
60,612
|
|
||
Other current assets
|
82,723
|
|
|
66,253
|
|
||
Total Current Assets
|
1,532,342
|
|
|
1,735,804
|
|
||
Property, Plant and Equipment, Net
|
293,085
|
|
|
259,358
|
|
||
Investments in Affiliates
|
143,813
|
|
|
128,590
|
|
||
Goodwill, Net
|
1,297,712
|
|
|
1,299,710
|
|
||
Indefinite-Lived Intangible Assets
|
99,052
|
|
|
102,195
|
|
||
Amortized Intangible Assets, Net
|
263,261
|
|
|
237,976
|
|
||
Prepaid Pension Cost
|
1,003,558
|
|
|
1,056,777
|
|
||
Deferred Income Taxes
|
13,388
|
|
|
15,367
|
|
||
Deferred Charges and Other Assets
|
117,830
|
|
|
102,046
|
|
||
Total Assets
|
$
|
4,764,041
|
|
|
$
|
4,937,823
|
|
Liabilities and Equity
|
|
|
|
|
|
||
Current Liabilities
|
|
|
|
|
|
||
Accounts payable and accrued liabilities
|
$
|
486,578
|
|
|
$
|
526,323
|
|
Deferred revenue
|
308,728
|
|
|
339,454
|
|
||
Income taxes payable
|
10,496
|
|
|
6,109
|
|
||
Current portion of long-term debt
|
6,360
|
|
|
6,726
|
|
||
Total Current Liabilities
|
812,162
|
|
|
878,612
|
|
||
Accrued Compensation and Related Benefits
|
179,652
|
|
|
213,889
|
|
||
Other Liabilities
|
57,901
|
|
|
65,977
|
|
||
Deferred Income Taxes
|
322,421
|
|
|
362,701
|
|
||
Mandatorily Redeemable Noncontrolling Interest
|
—
|
|
|
10,331
|
|
||
Long-Term Debt
|
470,777
|
|
|
486,561
|
|
||
Total Liabilities
|
1,842,913
|
|
|
2,018,071
|
|
||
Commitments and Contingencies
(Notes 17 and 18)
|
|
|
|
|
|
||
Redeemable Noncontrolling Interests
|
4,346
|
|
|
4,607
|
|
||
Preferred Stock,
$1 par value; 977,000 shares authorized, none issued
|
—
|
|
|
—
|
|
||
Common Stockholders’ Equity
|
|
|
|
|
|
||
Common stock
|
|
|
|
|
|
||
Class A Common stock, $1 par value;
7,000,000
shares authorized; 964,001 shares issued and outstanding
|
964
|
|
|
964
|
|
||
Class B Common stock, $1 par value; 40,000,000 shares authorized; 19,035,999 shares issued; 4,336,958 and 4,540,493 shares outstanding
|
19,036
|
|
|
19,036
|
|
||
Capital in excess of par value
|
378,837
|
|
|
370,700
|
|
||
Retained earnings
|
6,236,125
|
|
|
5,791,724
|
|
||
Accumulated other comprehensive income, net of taxes
|
|
|
|
|
|
||
Cumulative foreign currency translation adjustment
|
(29,270
|
)
|
|
6,314
|
|
||
Unrealized gain on available-for-sale securities
|
—
|
|
|
194,889
|
|
||
Unrealized gain on pensions and other postretirement plans
|
232,836
|
|
|
334,536
|
|
||
Cash flow hedge
|
263
|
|
|
(184
|
)
|
||
Cost of 14,699,041 and 14,495,506 shares of Class B common stock held in treasury
|
(3,922,009
|
)
|
|
(3,802,834
|
)
|
||
Total Equity
|
2,916,782
|
|
|
2,915,145
|
|
||
Total Liabilities and Equity
|
$
|
4,764,041
|
|
|
$
|
4,937,823
|
|
|
Year Ended December 31
|
||||||||||
(In thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Cash Flows from Operating Activities
|
|
|
|
|
|
||||||
Net Income
|
$
|
271,408
|
|
|
$
|
302,489
|
|
|
$
|
169,458
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation, amortization and goodwill and other long-lived asset impairment
|
112,245
|
|
|
113,310
|
|
|
92,894
|
|
|||
Net pension benefit
|
(100,948
|
)
|
|
(59,039
|
)
|
|
(67,097
|
)
|
|||
Early retirement and special separation benefit program expense
|
—
|
|
|
1,825
|
|
|
—
|
|
|||
Loss on marketable equity securities and cost method investments, net
|
4,180
|
|
|
—
|
|
|
—
|
|
|||
Stock-based compensation expense, net
|
6,412
|
|
|
10,169
|
|
|
13,418
|
|
|||
Debt extinguishment costs
|
10,563
|
|
|
—
|
|
|
—
|
|
|||
Foreign exchange loss (gain)
|
3,844
|
|
|
(3,310
|
)
|
|
39,890
|
|
|||
Net (gain) loss on sales and disposition of businesses
|
(8,157
|
)
|
|
569
|
|
|
(22,163
|
)
|
|||
Net (gain) loss on dispositions, sales or write-downs of marketable equity securities and cost method investments
|
(148
|
)
|
|
200
|
|
|
30,449
|
|
|||
Equity in (earnings) losses of affiliates, net of distributions
|
(10,606
|
)
|
|
3,646
|
|
|
8,859
|
|
|||
(Benefit from) provision for deferred income taxes
|
(7,123
|
)
|
|
(146,452
|
)
|
|
10,070
|
|
|||
Net (gain) loss on sales or write-downs of property, plant and equipment
|
(1,642
|
)
|
|
413
|
|
|
(32,362
|
)
|
|||
Change in operating assets and liabilities:
|
|
|
|
|
|
|
|||||
Accounts receivable, net
|
59,847
|
|
|
11,086
|
|
|
(47,892
|
)
|
|||
Inventories
|
(7,351
|
)
|
|
(541
|
)
|
|
(2,422
|
)
|
|||
Accounts payable and accrued liabilities
|
(44,892
|
)
|
|
19,380
|
|
|
58,147
|
|
|||
Deferred revenue
|
14,801
|
|
|
13,903
|
|
|
16,552
|
|
|||
Income taxes receivable/payable
|
9,405
|
|
|
24,739
|
|
|
5,115
|
|
|||
Other assets and other liabilities, net
|
(26,973
|
)
|
|
(25,469
|
)
|
|
(12,265
|
)
|
|||
Other
|
2,154
|
|
|
1,137
|
|
|
605
|
|
|||
Net Cash Provided by Operating Activities
|
287,019
|
|
|
268,055
|
|
|
261,256
|
|
|||
Cash Flows from Investing Activities
|
|
|
|
|
|
||||||
Investments in certain businesses, net of cash acquired
|
(111,546
|
)
|
|
(299,938
|
)
|
|
(245,084
|
)
|
|||
Purchases of property, plant and equipment
|
(98,192
|
)
|
|
(60,358
|
)
|
|
(66,612
|
)
|
|||
Proceeds from sales of marketable equity securities
|
66,741
|
|
|
—
|
|
|
29,702
|
|
|||
Purchases of marketable equity securities
|
(42,659
|
)
|
|
—
|
|
|
(48,265
|
)
|
|||
Advance related to Kaplan University transaction and loan to affiliate
|
(28,061
|
)
|
|
(6,771
|
)
|
|
(14,244
|
)
|
|||
Investments in equity affiliates, cost method and other investments
|
(11,702
|
)
|
|
(82,944
|
)
|
|
(6,273
|
)
|
|||
Net (payments) proceeds from sales of businesses, property, plant and equipment and other assets
|
(10,344
|
)
|
|
3,265
|
|
|
39,490
|
|
|||
Return of investment in equity affiliates
|
4,799
|
|
|
4,727
|
|
|
—
|
|
|||
Net Cash Used in Investing Activities
|
(230,964
|
)
|
|
(442,019
|
)
|
|
(311,286
|
)
|
|||
Cash Flows from Financing Activities
|
|
|
|
|
|
||||||
Repayments of borrowings and early redemption premium
|
(417,159
|
)
|
|
(7,715
|
)
|
|
—
|
|
|||
Issuance of borrowings
|
400,000
|
|
|
—
|
|
|
98,610
|
|
|||
Common shares repurchased
|
(118,030
|
)
|
|
(50,770
|
)
|
|
(108,948
|
)
|
|||
Dividends paid
|
(28,617
|
)
|
|
(28,329
|
)
|
|
(27,325
|
)
|
|||
Purchase of noncontrolling interest and deferred payment of acquisition
|
(16,500
|
)
|
|
(5,187
|
)
|
|
(21,000
|
)
|
|||
Payments of financing costs
|
(6,501
|
)
|
|
—
|
|
|
(648
|
)
|
|||
(Repayments of) proceeds from bank overdrafts
|
(5,717
|
)
|
|
(9,505
|
)
|
|
14,429
|
|
|||
Other
|
165
|
|
|
1,400
|
|
|
1,805
|
|
|||
Net Cash Used in Financing Activities
|
(192,359
|
)
|
|
(100,106
|
)
|
|
(43,077
|
)
|
|||
Effect of Currency Exchange Rate Change
|
(7,147
|
)
|
|
10,820
|
|
|
(11,029
|
)
|
|||
Net Decrease in Cash and Cash Equivalents and Restricted Cash
|
(143,451
|
)
|
|
(263,250
|
)
|
|
(104,136
|
)
|
|||
Cash and Cash Equivalents and Restricted Cash at Beginning of Year
|
407,566
|
|
|
670,816
|
|
|
774,952
|
|
|||
Cash and Cash Equivalents and Restricted Cash at End of Year
|
$
|
264,115
|
|
|
$
|
407,566
|
|
|
$
|
670,816
|
|
Supplemental Cash Flow Information
|
|
|
|
|
|
||||||
Cash paid during the year for:
|
|
|
|
|
|
||||||
Income taxes
|
$
|
54,000
|
|
|
$
|
4,000
|
|
|
$
|
65,000
|
|
Interest
|
$
|
42,000
|
|
|
$
|
33,000
|
|
|
$
|
30,000
|
|
(in thousands)
|
Class A
Common
Stock
|
Class B
Common Stock |
Capital in
Excess of
Par Value
|
Retained
Earnings
|
Accumulated Other Comprehensive Income
|
Treasury
Stock
|
Total Equity
|
|
Redeemable Noncontrolling Interest
|
||||||||||||||||
As of December 31, 2015
|
$
|
964
|
|
$
|
19,036
|
|
$
|
356,887
|
|
$
|
5,447,677
|
|
$
|
314,680
|
|
$
|
(3,648,546
|
)
|
$
|
2,490,698
|
|
|
$
|
25,957
|
|
Net income for the year
|
|
|
|
|
169,458
|
|
|
|
169,458
|
|
|
|
|||||||||||||
Net income attributable to redeemable noncontrolling interests
|
|
|
|
(868
|
)
|
|
|
(868
|
)
|
|
868
|
|
|||||||||||||
Change in redemption value of redeemable noncontrolling interests
|
|
|
(3,026
|
)
|
|
|
|
(3,026
|
)
|
|
3,026
|
|
|||||||||||||
Dividends paid on common stock
|
|
|
|
(27,325
|
)
|
|
|
(27,325
|
)
|
|
|
||||||||||||||
Repurchase of Class B common stock
|
|
|
|
|
|
(108,948
|
)
|
(108,948
|
)
|
|
|
||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures
|
|
|
(697
|
)
|
|
|
644
|
|
(53
|
)
|
|
|
|||||||||||||
Amortization of unearned stock compensation and stock option expense
|
|
|
14,717
|
|
|
|
|
14,717
|
|
|
|
||||||||||||||
Other comprehensive loss, net of income taxes
|
|
|
|
|
(78,194
|
)
|
|
(78,194
|
)
|
|
|
||||||||||||||
Taxes arising from employee stock plans
|
|
|
558
|
|
|
|
|
558
|
|
|
|
||||||||||||||
Purchase of redeemable noncontrolling interest
|
|
|
|
|
|
|
—
|
|
|
(24,031
|
)
|
||||||||||||||
Exchange of redeemable noncontrolling interest
|
|
|
(4,076
|
)
|
|
|
|
(4,076
|
)
|
|
(5,770
|
)
|
|||||||||||||
As of December 31, 2016
|
964
|
|
19,036
|
|
364,363
|
|
5,588,942
|
|
236,486
|
|
(3,756,850
|
)
|
2,452,941
|
|
|
50
|
|
||||||||
Net income for the year
|
|
|
|
302,489
|
|
|
|
302,489
|
|
|
|
||||||||||||||
Acquisition of redeemable noncontrolling interest
|
|
|
|
|
|
|
—
|
|
|
3,666
|
|
||||||||||||||
Net income attributable to redeemable noncontrolling interests
|
|
|
|
(445
|
)
|
|
|
(445
|
)
|
|
445
|
|
|||||||||||||
Change in redemption value of redeemable noncontrolling interests
|
|
|
(446
|
)
|
|
|
|
(446
|
)
|
|
446
|
|
|||||||||||||
Dividends paid on common stock
|
|
|
|
(28,329
|
)
|
|
|
(28,329
|
)
|
|
|
||||||||||||||
Repurchase of Class B common stock
|
|
|
|
|
|
(50,770
|
)
|
(50,770
|
)
|
|
|
||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures
|
|
|
(4,401
|
)
|
|
|
4,786
|
|
385
|
|
|
|
|||||||||||||
Amortization of unearned stock compensation and stock option expense
|
|
|
11,184
|
|
|
|
|
11,184
|
|
|
|
||||||||||||||
Other comprehensive income, net of income taxes
|
|
|
|
|
228,136
|
|
|
228,136
|
|
|
|
||||||||||||||
Reclassification of stranded tax effects as a result of tax reform
|
|
|
|
(70,933
|
)
|
70,933
|
|
|
—
|
|
|
|
|||||||||||||
As of December 31, 2017
|
964
|
|
19,036
|
|
370,700
|
|
5,791,724
|
|
535,555
|
|
(3,802,834
|
)
|
2,915,145
|
|
|
4,607
|
|
||||||||
Net income for the year
|
|
|
|
271,408
|
|
|
|
271,408
|
|
|
|
||||||||||||||
Net income attributable to redeemable noncontrolling interests
|
|
|
|
(202
|
)
|
|
|
(202
|
)
|
|
202
|
|
|||||||||||||
Change in redemption value of redeemable noncontrolling interests
|
|
|
413
|
|
|
|
|
413
|
|
|
(413
|
)
|
|||||||||||||
Dividends paid on common stock
|
|
|
|
(28,617
|
)
|
|
|
(28,617
|
)
|
|
|
||||||||||||||
Repurchase of Class B common stock
|
|
|
|
|
|
(118,030
|
)
|
(118,030
|
)
|
|
|
||||||||||||||
Issuance of Class B common stock, net of restricted stock award forfeitures
|
|
|
(340
|
)
|
|
|
(1,145
|
)
|
(1,485
|
)
|
|
|
|||||||||||||
Amortization of unearned stock compensation and stock option expense
|
|
|
8,064
|
|
|
|
|
8,064
|
|
|
|
||||||||||||||
Other comprehensive loss, net of income taxes
|
|
|
|
|
(136,837
|
)
|
|
(136,837
|
)
|
|
|
||||||||||||||
Cumulative effect of accounting change
|
|
|
|
|
|
|
201,812
|
|
(194,889
|
)
|
|
6,923
|
|
|
|
||||||||||
Other
|
|
|
|
|
|
|
|
—
|
|
|
(50
|
)
|
|||||||||||||
As of December 31, 2018
|
$
|
964
|
|
$
|
19,036
|
|
$
|
378,837
|
|
$
|
6,236,125
|
|
$
|
203,829
|
|
$
|
(3,922,009
|
)
|
$
|
2,916,782
|
|
|
$
|
4,346
|
|
1.
|
ORGANIZATION AND NATURE OF OPERATIONS
|
2.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
(in thousands)
|
Balance as of December 31, 2017
|
Adjustments
|
Balance as of January 1, 2018
|
||||||
Assets
|
|
|
|
||||||
Accounts receivable, net
|
$
|
620,319
|
|
$
|
2,142
|
|
$
|
622,461
|
|
Inventories and contracts in progress
|
60,612
|
|
246
|
|
60,858
|
|
|||
Other current assets
|
66,253
|
|
6,343
|
|
72,596
|
|
|||
Liabilities
|
|
|
|
||||||
Accounts payable and accrued liabilities
|
$
|
526,323
|
|
$
|
88
|
|
$
|
526,411
|
|
Deferred revenue
|
339,454
|
|
(346
|
)
|
339,108
|
|
|||
Deferred income taxes
|
362,701
|
|
2,066
|
|
364,767
|
|
|||
Equity
|
|
|
|
||||||
Retained earnings
|
$
|
5,791,724
|
|
$
|
6,923
|
|
$
|
5,798,647
|
|
(in thousands)
|
As Previously Reported
|
|
Adjustment
|
|
Upon Adoption
|
||||||
Year Ended December 31, 2017
|
|
|
|
|
|
||||||
Operating expenses
|
$
|
1,359,842
|
|
|
$
|
94,501
|
|
|
$
|
1,454,343
|
|
Selling, general and administrative expenses
|
909,592
|
|
|
(21,802
|
)
|
|
887,790
|
|
|||
Income from Operations
|
209,102
|
|
|
(72,699
|
)
|
|
136,403
|
|
|||
Non-operating pension and postretirement benefit income, net
|
—
|
|
|
72,699
|
|
|
72,699
|
|
|||
Income Before Income Taxes
|
182,789
|
|
|
—
|
|
|
182,789
|
|
|||
|
|
|
|
|
|
||||||
Year Ended December 31, 2016
|
|
|
|
|
|
||||||
Operating expenses
|
$
|
1,180,945
|
|
|
$
|
89,085
|
|
|
$
|
1,270,030
|
|
Selling, general and administrative expenses
|
904,517
|
|
|
(8,420
|
)
|
|
896,097
|
|
|||
Income from Operations
|
303,534
|
|
|
(80,665
|
)
|
|
222,869
|
|
|||
Non-operating pension and postretirement benefit income, net
|
—
|
|
|
80,665
|
|
|
80,665
|
|
|||
Income Before Income Taxes
|
250,658
|
|
|
—
|
|
|
250,658
|
|
3.
|
ACQUISITIONS AND DISPOSITIONS OF BUSINESSES
|
|
|
Purchase Price Allocation
|
||||||||||
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Accounts receivable
|
|
$
|
2,344
|
|
|
$
|
12,502
|
|
|
$
|
8,538
|
|
Inventory
|
|
1,268
|
|
|
25,253
|
|
|
878
|
|
|||
Property, plant and equipment
|
|
1,518
|
|
|
29,921
|
|
|
3,940
|
|
|||
Goodwill
|
|
41,840
|
|
|
143,149
|
|
|
184,118
|
|
|||
Indefinite-lived intangible assets
|
|
—
|
|
|
33,800
|
|
|
53,110
|
|
|||
Amortized intangible assets
|
|
78,427
|
|
|
170,658
|
|
|
28,267
|
|
|||
Other assets
|
|
5,198
|
|
|
1,880
|
|
|
1,420
|
|
|||
Pension and other postretirement benefits liabilities
|
|
—
|
|
|
(59,116
|
)
|
|
—
|
|
|||
Other liabilities
|
|
(7,678
|
)
|
|
(12,177
|
)
|
|
(21,892
|
)
|
|||
Deferred income taxes
|
|
(4,900
|
)
|
|
(37,289
|
)
|
|
(11,009
|
)
|
|||
Redeemable noncontrolling interest
|
|
—
|
|
|
(3,666
|
)
|
|
—
|
|
|||
Aggregate purchase price, net of cash acquired
|
|
$
|
118,017
|
|
|
$
|
304,915
|
|
|
$
|
247,370
|
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Operating revenues
|
$
|
2,735,879
|
|
|
$
|
2,725,046
|
|
|
$
|
2,570,416
|
|
Net income
|
273,688
|
|
|
311,397
|
|
|
175,021
|
|
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Revenue
|
|
$
|
91,526
|
|
|
$
|
430,645
|
|
|
$
|
500,914
|
|
Operating income
|
|
213
|
|
|
17,869
|
|
|
39,498
|
|
4.
|
INVESTMENTS
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Total cost
|
$
|
282,563
|
|
|
$
|
269,343
|
|
Gross unrealized gains
|
216,111
|
|
|
266,972
|
|
||
Gross unrealized losses
|
(2,284
|
)
|
|
—
|
|
||
Total Fair Value
|
$
|
496,390
|
|
|
$
|
536,315
|
|
|
Year ended
|
||
(in thousands)
|
December 31, 2018
|
||
Loss on marketable equity securities, net
|
$
|
(15,843
|
)
|
Plus: Net losses in earnings from marketable equity securities sold
|
4,271
|
|
|
Net unrealized losses in earnings from marketable equity securities still held at the end of the year
|
$
|
(11,572
|
)
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Receivables from contracts with customers, less doubtful accounts of $14,775 and $22,975
|
$
|
538,021
|
|
|
$
|
600,215
|
|
Other receivables
|
44,259
|
|
|
20,104
|
|
||
|
$
|
582,280
|
|
|
$
|
620,319
|
|
(in thousands)
|
Balance at
Beginning of Period
|
|
Additions –
Charged to
Costs and
Expenses
|
|
Deductions
|
|
Balance
at
End of
Period
|
||||||||
2018
|
$
|
22,975
|
|
|
$
|
10,209
|
|
|
$
|
(18,409
|
)
|
|
$
|
14,775
|
|
2017
|
$
|
26,723
|
|
|
$
|
33,830
|
|
|
$
|
(37,578
|
)
|
|
$
|
22,975
|
|
2016
|
$
|
27,854
|
|
|
$
|
29,718
|
|
|
$
|
(30,849
|
)
|
|
$
|
26,723
|
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Accounts payable and accrued liabilities
|
$
|
337,123
|
|
|
$
|
385,927
|
|
Accrued compensation and related benefits
|
149,455
|
|
|
140,396
|
|
||
|
$
|
486,578
|
|
|
$
|
526,323
|
|
6.
|
INVENTORIES AND CONTRACTS IN PROGRESS
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Raw materials
|
$
|
37,248
|
|
|
$
|
30,429
|
|
Work-in-process
|
11,633
|
|
|
10,258
|
|
||
Finished goods
|
17,861
|
|
|
18,851
|
|
||
Contracts in progress
|
2,735
|
|
|
1,074
|
|
||
|
$
|
69,477
|
|
|
$
|
60,612
|
|
7.
|
PROPERTY, PLANT AND EQUIPMENT
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Land
|
$
|
15,965
|
|
|
$
|
16,190
|
|
Buildings
|
108,683
|
|
|
107,932
|
|
||
Machinery, equipment and fixtures
|
382,064
|
|
|
387,914
|
|
||
Leasehold improvements
|
206,170
|
|
|
215,445
|
|
||
Construction in progress
|
68,064
|
|
|
16,649
|
|
||
|
780,946
|
|
|
744,130
|
|
||
Less accumulated depreciation
|
(487,861
|
)
|
|
(484,772
|
)
|
||
|
$
|
293,085
|
|
|
$
|
259,358
|
|
8.
|
GOODWILL AND OTHER INTANGIBLE ASSETS
|
(in thousands)
|
Education
|
|
Television
Broadcasting
|
|
Healthcare
|
|
Other
Businesses
|
|
Total
|
||||||||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodwill
|
$
|
1,111,003
|
|
|
$
|
168,345
|
|
|
$
|
59,640
|
|
|
$
|
142,501
|
|
|
$
|
1,481,489
|
|
Accumulated impairment losses
|
(350,850
|
)
|
|
—
|
|
|
—
|
|
|
(7,685
|
)
|
|
(358,535
|
)
|
|||||
|
760,153
|
|
|
168,345
|
|
|
59,640
|
|
|
134,816
|
|
|
1,122,954
|
|
|||||
Acquisitions
|
19,174
|
|
|
22,470
|
|
|
10,181
|
|
|
91,324
|
|
|
143,149
|
|
|||||
Impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,616
|
)
|
|
(7,616
|
)
|
|||||
Dispositions
|
—
|
|
|
—
|
|
|
(412
|
)
|
|
—
|
|
|
(412
|
)
|
|||||
Foreign currency exchange rate changes
|
41,635
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41,635
|
|
|||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Goodwill
|
1,171,812
|
|
|
190,815
|
|
|
69,409
|
|
|
233,825
|
|
|
1,665,861
|
|
|||||
Accumulated impairment losses
|
(350,850
|
)
|
|
—
|
|
|
—
|
|
|
(15,301
|
)
|
|
(366,151
|
)
|
|||||
|
820,962
|
|
|
190,815
|
|
|
69,409
|
|
|
218,524
|
|
|
1,299,710
|
|
|||||
Acquisitions
|
20,424
|
|
|
—
|
|
|
217
|
|
|
21,199
|
|
|
41,840
|
|
|||||
Dispositions
|
(11,191
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,191
|
)
|
|||||
Foreign currency exchange rate changes
|
(32,647
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32,647
|
)
|
|||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodwill
|
1,128,699
|
|
|
190,815
|
|
|
69,626
|
|
|
255,024
|
|
|
1,644,164
|
|
|||||
Accumulated impairment losses
|
(331,151
|
)
|
|
—
|
|
|
—
|
|
|
(15,301
|
)
|
|
(346,452
|
)
|
|||||
|
$
|
797,548
|
|
|
$
|
190,815
|
|
|
$
|
69,626
|
|
|
$
|
239,723
|
|
|
$
|
1,297,712
|
|
(in thousands)
|
Kaplan
International
|
|
Higher
Education
|
|
Test
Preparation
|
|
Professional (U.S.)
|
|
Total
|
||||||||||
As of December 31, 2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodwill
|
$
|
555,185
|
|
|
$
|
205,494
|
|
|
$
|
166,098
|
|
|
$
|
184,226
|
|
|
$
|
1,111,003
|
|
Accumulated impairment losses
|
—
|
|
|
(131,023
|
)
|
|
(102,259
|
)
|
|
(117,568
|
)
|
|
(350,850
|
)
|
|||||
|
555,185
|
|
|
74,471
|
|
|
63,839
|
|
|
66,658
|
|
|
760,153
|
|
|||||
Acquisitions
|
19,174
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,174
|
|
|||||
Foreign currency exchange rate changes
|
41,502
|
|
|
—
|
|
|
—
|
|
|
133
|
|
|
41,635
|
|
|||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
||||||||||
Goodwill
|
615,861
|
|
|
205,494
|
|
|
166,098
|
|
|
184,359
|
|
|
1,171,812
|
|
|||||
Accumulated impairment losses
|
—
|
|
|
(131,023
|
)
|
|
(102,259
|
)
|
|
(117,568
|
)
|
|
(350,850
|
)
|
|||||
|
615,861
|
|
|
74,471
|
|
|
63,839
|
|
|
66,791
|
|
|
820,962
|
|
|||||
Acquisitions
|
62
|
|
|
—
|
|
|
822
|
|
|
19,540
|
|
|
20,424
|
|
|||||
Dispositions
|
—
|
|
|
(11,191
|
)
|
|
—
|
|
|
—
|
|
|
(11,191
|
)
|
|||||
Foreign currency exchange rate changes
|
(32,499
|
)
|
|
(40
|
)
|
|
—
|
|
|
(108
|
)
|
|
(32,647
|
)
|
|||||
As of December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Goodwill
|
583,424
|
|
|
174,564
|
|
|
166,920
|
|
|
203,791
|
|
|
1,128,699
|
|
|||||
Accumulated impairment losses
|
—
|
|
|
(111,324
|
)
|
|
(102,259
|
)
|
|
(117,568
|
)
|
|
(331,151
|
)
|
|||||
|
$
|
583,424
|
|
|
$
|
63,240
|
|
|
$
|
64,661
|
|
|
$
|
86,223
|
|
|
$
|
797,548
|
|
|
|
|
As of December 31, 2018
|
|
As of December 31, 2017
|
||||||||||||||||||||
(in thousands)
|
Useful
Life
Range
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
Carrying Amount |
||||||||||||
Amortized Intangible Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Student and customer relationships
|
2–10 years (1)
|
|
$
|
282,761
|
|
|
$
|
114,429
|
|
|
$
|
168,332
|
|
|
$
|
260,464
|
|
|
$
|
83,690
|
|
|
$
|
176,774
|
|
Trade names and trademarks
|
2–10 years
|
|
87,285
|
|
|
39,825
|
|
|
47,460
|
|
|
50,286
|
|
|
25,596
|
|
|
24,690
|
|
||||||
Network affiliation agreements
|
10 years
|
|
17,400
|
|
|
3,408
|
|
|
13,992
|
|
|
17,400
|
|
|
1,668
|
|
|
15,732
|
|
||||||
Databases and technology
|
3–6 years
|
|
27,041
|
|
|
8,471
|
|
|
18,570
|
|
|
19,563
|
|
|
5,008
|
|
|
14,555
|
|
||||||
Noncompete agreements
|
2–5 years
|
|
1,088
|
|
|
838
|
|
|
250
|
|
|
930
|
|
|
467
|
|
|
463
|
|
||||||
Other
|
1–8 years
|
|
24,530
|
|
|
9,873
|
|
|
14,657
|
|
|
13,430
|
|
|
7,668
|
|
|
5,762
|
|
||||||
|
|
|
$
|
440,105
|
|
|
$
|
176,844
|
|
|
$
|
263,261
|
|
|
$
|
362,073
|
|
|
$
|
124,097
|
|
|
$
|
237,976
|
|
Indefinite-Lived Intangible Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Trade names and trademarks
|
|
|
$
|
80,102
|
|
|
|
|
|
|
|
|
$
|
82,745
|
|
|
|
|
|
||||||
FCC licenses
|
|
|
18,800
|
|
|
|
|
|
|
18,800
|
|
|
|
|
|
||||||||||
Licensure and accreditation
|
|
|
150
|
|
|
|
|
|
|
|
|
650
|
|
|
|
|
|
|
|
||||||
|
|
|
$
|
99,052
|
|
|
|
|
|
|
|
|
$
|
102,195
|
|
|
|
|
|
|
|
(1)
|
As of December 31, 2017, the student and customer relationships’ minimum useful life was 1 year.
|
9.
|
INCOME TAXES
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
U.S.
|
$
|
257,312
|
|
|
$
|
134,276
|
|
|
$
|
227,457
|
|
Non-U.S.
|
66,196
|
|
|
48,513
|
|
|
23,201
|
|
|||
|
$
|
323,508
|
|
|
$
|
182,789
|
|
|
$
|
250,658
|
|
(in thousands)
|
Current
|
|
Deferred
|
|
Total
|
||||||
Year Ended December 31, 2018
|
|
|
|
|
|
||||||
U.S. Federal
|
$
|
46,059
|
|
|
$
|
16,718
|
|
|
$
|
62,777
|
|
State and Local
|
2,240
|
|
|
(23,809
|
)
|
|
(21,569
|
)
|
|||
Non-U.S.
|
10,924
|
|
|
(32
|
)
|
|
10,892
|
|
|||
|
$
|
59,223
|
|
|
$
|
(7,123
|
)
|
|
$
|
52,100
|
|
Year Ended December 31, 2017
|
|
|
|
|
|
||||||
U.S. Federal
|
$
|
10,743
|
|
|
$
|
(153,217
|
)
|
|
$
|
(142,474
|
)
|
State and Local
|
5,930
|
|
|
3,306
|
|
|
9,236
|
|
|||
Non-U.S.
|
10,079
|
|
|
3,459
|
|
|
13,538
|
|
|||
|
$
|
26,752
|
|
|
$
|
(146,452
|
)
|
|
$
|
(119,700
|
)
|
Year Ended December 31, 2016
|
|
|
|
|
|
||||||
U.S. Federal
|
$
|
56,342
|
|
|
$
|
33,959
|
|
|
$
|
90,301
|
|
State and Local
|
6,325
|
|
|
(5,164
|
)
|
|
1,161
|
|
|||
Non-U.S.
|
8,463
|
|
|
(18,725
|
)
|
|
(10,262
|
)
|
|||
|
$
|
71,130
|
|
|
$
|
10,070
|
|
|
$
|
81,200
|
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
U.S. Federal taxes at statutory rate (see above)
|
$
|
67,937
|
|
|
$
|
63,976
|
|
|
$
|
87,731
|
|
State and local taxes, net of U.S. Federal tax
|
(1,279
|
)
|
|
6,949
|
|
|
(2,965
|
)
|
|||
Valuation allowances against state tax benefits, net of U.S. Federal tax
|
(15,767
|
)
|
|
(946
|
)
|
|
3,196
|
|
|||
Stock-based compensation
|
(1,731
|
)
|
|
(6,023
|
)
|
|
—
|
|
|||
Valuation allowances against other non-U.S. income tax benefits
|
1,322
|
|
|
(1,935
|
)
|
|
(12,688
|
)
|
|||
Goodwill impairments and dispositions
|
—
|
|
|
—
|
|
|
(5,631
|
)
|
|||
U.S. Federal Manufacturing Deduction tax benefits
|
—
|
|
|
(1,329
|
)
|
|
(6,012
|
)
|
|||
Write-off of deferred taxes related to intercompany loans
|
—
|
|
|
—
|
|
|
10,965
|
|
|||
Deferred tax impact of U.S. Federal tax rate reduction to 21%, net of state tax impact
|
—
|
|
|
(153,336
|
)
|
|
—
|
|
|||
Deferred tax benefit on unremitted non-U.S. subsidiary earnings related to the Tax Act
|
—
|
|
|
(28,324
|
)
|
|
—
|
|
|||
Other, net
|
1,618
|
|
|
1,268
|
|
|
6,604
|
|
|||
Provision for (Benefit from) Income Taxes
|
$
|
52,100
|
|
|
$
|
(119,700
|
)
|
|
$
|
81,200
|
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Employee benefit obligations
|
$
|
68,392
|
|
|
$
|
84,148
|
|
Accounts receivable
|
4,449
|
|
|
5,481
|
|
||
State income tax loss carryforwards
|
34,107
|
|
|
35,434
|
|
||
State capital loss carryforwards
|
1,093
|
|
|
—
|
|
||
U.S. Federal income tax loss carryforwards
|
2,100
|
|
|
2,857
|
|
||
U.S. Federal foreign income tax credit carryforwards
|
987
|
|
|
2,522
|
|
||
Non-U.S. income tax loss carryforwards
|
15,868
|
|
|
18,797
|
|
||
Non-U.S. capital loss carryforwards
|
3,609
|
|
|
2,336
|
|
||
Other
|
14,657
|
|
|
26,546
|
|
||
Deferred Tax Assets
|
145,262
|
|
|
178,121
|
|
||
Valuation allowances
|
(33,120
|
)
|
|
(48,742
|
)
|
||
Deferred Tax Assets, Net
|
$
|
112,142
|
|
|
$
|
129,379
|
|
Prepaid pension cost
|
269,412
|
|
|
283,604
|
|
||
Unrealized gain on available-for-sale securities
|
51,242
|
|
|
70,827
|
|
||
Goodwill and other intangible assets
|
88,798
|
|
|
109,428
|
|
||
Property, plant and equipment
|
9,997
|
|
|
11,248
|
|
||
Non-U.S. withholding tax
|
1,726
|
|
|
1,606
|
|
||
Deferred Tax Liabilities
|
$
|
421,175
|
|
|
$
|
476,713
|
|
Deferred Income Tax Liabilities, Net
|
$
|
309,033
|
|
|
$
|
347,334
|
|
(in thousands)
|
Balance at Beginning of Period
|
|
Tax Expense and Revaluation
|
|
Deductions
|
|
Balance at End of
Period
|
||||||||
Year ended
|
|
|
|
|
|
|
|
||||||||
December 31, 2018
|
$
|
48,742
|
|
|
$
|
4,413
|
|
|
$
|
(20,035
|
)
|
|
$
|
33,120
|
|
December 31, 2017
|
$
|
41,319
|
|
|
$
|
7,423
|
|
|
$
|
—
|
|
|
$
|
48,742
|
|
December 31, 2016
|
$
|
69,545
|
|
|
$
|
4,709
|
|
|
$
|
(32,935
|
)
|
|
$
|
41,319
|
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Beginning unrecognized tax benefits
|
$
|
17,331
|
|
|
$
|
17,331
|
|
|
$
|
17,331
|
|
Increases related to current year tax positions
|
—
|
|
|
—
|
|
|
—
|
|
|||
Increases related to prior year tax positions
|
500
|
|
|
—
|
|
|
—
|
|
|||
Decreases related to prior year tax positions
|
(12,187
|
)
|
|
—
|
|
|
—
|
|
|||
Decreases related to settlement with tax authorities
|
—
|
|
|
—
|
|
|
—
|
|
|||
Decreases due to lapse of applicable statutes of limitations
|
(3,161
|
)
|
|
—
|
|
|
—
|
|
|||
Ending unrecognized tax benefits
|
$
|
2,483
|
|
|
$
|
17,331
|
|
|
$
|
17,331
|
|
10.
|
DEBT
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
5.75% unsecured notes due June 1, 2026
(1)
|
$
|
394,675
|
|
|
$
|
—
|
|
7.25% unsecured notes due February 1, 2019
|
—
|
|
|
399,507
|
|
||
U.K. Credit facility
(2)
|
82,366
|
|
|
93,671
|
|
||
Other indebtedness
|
96
|
|
|
109
|
|
||
Total Debt
|
477,137
|
|
|
493,287
|
|
||
Less: current portion
|
(6,360
|
)
|
|
(6,726
|
)
|
||
Total Long-Term Debt
|
$
|
470,777
|
|
|
$
|
486,561
|
|
(1)
|
The carrying value is net of
$5.3 million
of unamortized debt issuance costs as of December 31,
2018
.
|
(2)
|
The carrying value is net of
$0.2 million
and
$0.4 million
of unamortized debt issuance costs as of December 31,
2018
and
2017
, respectively.
|
11.
|
FAIR VALUE MEASUREMENTS
|
|
As of December 31, 2018
|
||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Total
|
||||||
Assets
|
|
|
|
|
|
||||||
Money market investments
(1)
|
$
|
—
|
|
|
$
|
75,500
|
|
|
$
|
75,500
|
|
Marketable equity securities
(2)
|
496,390
|
|
|
—
|
|
|
496,390
|
|
|||
Other current investments
(3)
|
11,203
|
|
|
6,988
|
|
|
18,191
|
|
|||
Interest rate swap
(4)
|
—
|
|
|
369
|
|
|
369
|
|
|||
Total Financial Assets
|
$
|
507,593
|
|
|
$
|
82,857
|
|
|
$
|
590,450
|
|
Liabilities
|
|
|
|
|
|
||||||
Deferred compensation plan liabilities
(5)
|
$
|
—
|
|
|
$
|
36,080
|
|
|
$
|
36,080
|
|
|
As of December 31, 2017
|
||||||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Money market investments
(1)
|
$
|
—
|
|
|
$
|
217,628
|
|
|
$
|
—
|
|
|
$
|
217,628
|
|
Marketable equity securities
(2)
|
536,315
|
|
|
—
|
|
|
—
|
|
|
536,315
|
|
||||
Other current investments
(3)
|
9,831
|
|
|
11,007
|
|
|
—
|
|
|
20,838
|
|
||||
Total Financial Assets
|
$
|
546,146
|
|
|
$
|
228,635
|
|
|
$
|
—
|
|
|
$
|
774,781
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Deferred compensation plan liabilities
(5)
|
$
|
—
|
|
|
$
|
43,414
|
|
|
$
|
—
|
|
|
$
|
43,414
|
|
Interest rate swap
(6)
|
—
|
|
|
244
|
|
|
—
|
|
|
244
|
|
||||
Mandatorily redeemable noncontrolling interest
(7)
|
—
|
|
|
—
|
|
|
10,331
|
|
|
10,331
|
|
||||
Total Financial Liabilities
|
$
|
—
|
|
|
$
|
43,658
|
|
|
$
|
10,331
|
|
|
$
|
53,989
|
|
(1)
|
The Company’s money market investments are included in cash, cash equivalents and restricted cash and the value considers the liquidity of the counterparty.
|
(2)
|
The Company’s investments in marketable equity securities are held in common shares of U.S. corporations that are actively traded on U.S. stock exchanges. Price quotes for these shares are readily available. Investments in marketable securities were classified as available-for-sale in 2017 prior to the adoption of the new accounting guidance (see Note 2).
|
(3)
|
Includes U.S. Government Securities, corporate bonds, mutual funds and time deposits. These investments are valued using a market approach based on the quoted market prices of the security or inputs that include quoted market prices for similar instruments and are classified as either Level 1 or Level 2 in the fair value hierarchy.
|
(4)
|
Included in Deferred Charges and Other Assets. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates.
|
(5)
|
Includes Graham Holdings Company’s Deferred Compensation Plan and supplemental savings plan benefits under the Graham Holdings Company’s Supplemental Executive Retirement Plan, which are included in accrued compensation and related benefits. These plans measure the market value of a participant’s balance in a notional investment account that is comprised primarily of mutual funds, which are based on observable market prices. However, since the deferred compensation obligations are not exchanged in an active market, they are classified as Level 2 in the fair value hierarchy. Realized and unrealized gains (losses) on deferred compensation are included in operating income.
|
(6)
|
Included in Other liabilities. The Company utilized a market approach model using the notional amount of the interest rate swap multiplied by the observable inputs of time to maturity and market interest rates.
|
(7)
|
The fair value of the mandatorily redeemable noncontrolling interest is based on an EBITDA multiple, adjusted for working capital and other items, which approximates fair value.
|
12.
|
REVENUE FROM CONTRACTS WITH CUSTOMERS
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Education Revenue
|
|
|
|
|
|
||||||
Kaplan international
|
$
|
719,982
|
|
|
$
|
697,999
|
|
|
$
|
696,362
|
|
Higher education
|
342,085
|
|
|
431,425
|
|
|
501,784
|
|
|||
Test preparation
|
256,102
|
|
|
273,298
|
|
|
286,556
|
|
|||
Professional (U.S.)
|
134,187
|
|
|
115,839
|
|
|
115,263
|
|
|||
Kaplan corporate and other
|
1,142
|
|
|
294
|
|
|
214
|
|
|||
Intersegment elimination
|
(2,483
|
)
|
|
(2,079
|
)
|
|
(1,718
|
)
|
|||
|
1,451,015
|
|
|
1,516,776
|
|
|
1,598,461
|
|
|||
Television broadcasting
|
505,549
|
|
|
409,916
|
|
|
409,718
|
|
|||
Manufacturing
|
487,619
|
|
|
414,193
|
|
|
241,604
|
|
|||
Healthcare
|
149,275
|
|
|
154,202
|
|
|
146,962
|
|
|||
SocialCode
|
58,728
|
|
|
62,077
|
|
|
58,851
|
|
|||
Other
|
43,880
|
|
|
34,733
|
|
|
26,433
|
|
|||
Intersegment elimination
|
(100
|
)
|
|
(51
|
)
|
|
(139
|
)
|
|||
Total Revenue
|
$
|
2,695,966
|
|
|
$
|
2,591,846
|
|
|
$
|
2,481,890
|
|
|
As of
|
|
||||||
|
December 31,
2018 |
|
January 1,
2018 |
%
|
||||
(in thousands)
|
|
Change
|
||||||
Deferred revenue
|
$
|
311,214
|
|
|
$
|
342,640
|
|
(9)
|
(in thousands)
|
Balance at
Beginning
of Year
|
|
Costs Associated with New Contracts
|
|
Less: Costs Amortized during the Year
|
|
Other
|
|
Balance
at
End of
Year
|
||||||||||
2018
|
$
|
16,043
|
|
|
$
|
55,664
|
|
|
$
|
(49,284
|
)
|
|
$
|
(1,112
|
)
|
|
$
|
21,311
|
|
13.
|
CAPITAL STOCK, STOCK AWARDS AND STOCK OPTIONS
|
|
Number of Shares
|
|
Average Grant-Date Fair Value
|
|||
Beginning of year, unvested
|
51,575
|
|
|
$
|
744.07
|
|
Awarded
|
375
|
|
|
875.40
|
|
|
Vested
|
(14,275
|
)
|
|
694.81
|
|
|
Forfeited
|
(5,475
|
)
|
|
863.21
|
|
|
End of Year, unvested
|
32,200
|
|
|
747.18
|
|
|
Number of Shares
|
|
Average Option Price
|
|||
Beginning of year
|
185,520
|
|
|
$
|
565.65
|
|
Granted
|
—
|
|
|
—
|
|
|
Exercised
|
(588
|
)
|
|
281.18
|
|
|
Expired or forfeited
|
—
|
|
|
—
|
|
|
End of Year
|
184,932
|
|
|
566.55
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||
Range of Exercise Prices
|
|
Shares Outstanding at 12/31/2018
|
|
Weighted
Average
Remaining
Contractual
Life (years)
|
|
Weighted
Average Exercise Price |
|
Shares Exercisable at 12/31/2018
|
|
Weighted
Average Remaining Contractual Life (years) |
|
Weighted
Average Exercise Price |
||||||
$244–276
|
|
3,674
|
|
|
2.5
|
|
$
|
259.19
|
|
|
3,674
|
|
|
2.5
|
|
$
|
259.19
|
|
325
|
|
77,258
|
|
|
2.1
|
|
325.26
|
|
|
77,258
|
|
|
2.1
|
|
325.26
|
|
||
719
|
|
77,258
|
|
|
5.8
|
|
719.15
|
|
|
51,504
|
|
|
5.8
|
|
719.15
|
|
||
805–872
|
|
26,742
|
|
|
7.0
|
|
865.02
|
|
|
12,702
|
|
|
6.9
|
|
866.03
|
|
||
|
|
184,932
|
|
|
4.4
|
|
566.55
|
|
|
145,138
|
|
|
3.9
|
|
510.69
|
|
|
2017
|
Expected life (years)
|
8
|
Interest rate
|
2.28%
|
Volatility
|
26.93%
|
Dividend yield
|
0.85%
|
|
Year Ended December 31
|
||||||||||
(in thousands, except per share amounts)
|
2018
|
|
2017
|
|
2016
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Numerator for basic earnings per share:
|
|
|
|
|
|
||||||
Net income attributable to Graham Holdings Company common stockholders
|
$
|
271,206
|
|
|
$
|
302,044
|
|
|
$
|
168,590
|
|
Less: Dividends paid–common stock outstanding and unvested restricted shares
|
(28,617
|
)
|
|
(28,329
|
)
|
|
(27,325
|
)
|
|||
Undistributed earnings
|
242,589
|
|
|
273,715
|
|
|
141,265
|
|
|||
Percent allocated to common stockholders
|
99.39
|
%
|
|
99.06
|
%
|
|
98.79
|
%
|
|||
|
241,115
|
|
|
271,150
|
|
|
139,562
|
|
|||
Add: Dividends paid–common stock outstanding
|
28,423
|
|
|
28,060
|
|
|
26,962
|
|
|||
Numerator for basic earnings per share
|
269,538
|
|
|
299,210
|
|
|
166,524
|
|
|||
Add: Additional undistributed earnings due to dilutive stock options
|
10
|
|
|
17
|
|
|
9
|
|
|||
Numerator for diluted earnings per share
|
$
|
269,548
|
|
|
$
|
299,227
|
|
|
$
|
166,533
|
|
Denominator:
|
|
|
|
|
|
||||||
Denominator for basic earnings per share:
|
|
|
|
|
|
||||||
Weighted average shares outstanding
|
5,333
|
|
|
5,516
|
|
|
5,559
|
|
|||
Add: Effect of dilutive stock options
|
37
|
|
|
36
|
|
|
30
|
|
|||
Denominator for diluted earnings per share
|
5,370
|
|
|
5,552
|
|
|
5,589
|
|
|||
Graham Holdings Company Common Stockholders:
|
|
|
|
|
|
|
|
|
|||
Basic earnings per share
|
$
|
50.55
|
|
|
$
|
54.24
|
|
|
$
|
29.95
|
|
Diluted earnings per share
|
$
|
50.20
|
|
|
$
|
53.89
|
|
|
$
|
29.80
|
|
|
Year Ended December 31
|
|||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|||
Weighted average restricted stock
|
23
|
|
|
30
|
|
|
40
|
|
14.
|
PENSIONS AND OTHER POSTRETIREMENT PLANS
|
|
Pension Plans
|
||||||
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Change in Benefit Obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
1,286,694
|
|
|
$
|
1,160,897
|
|
Service cost
|
18,221
|
|
|
18,687
|
|
||
Interest cost
|
46,787
|
|
|
47,925
|
|
||
Amendments
|
7,183
|
|
|
75
|
|
||
Actuarial (gain) loss
|
(81,851
|
)
|
|
73,191
|
|
||
Acquisitions
|
—
|
|
|
58,600
|
|
||
Benefits paid
|
(63,852
|
)
|
|
(74,506
|
)
|
||
Special termination benefits
|
—
|
|
|
1,825
|
|
||
Curtailment
|
(836
|
)
|
|
—
|
|
||
Settlement
|
(95,777
|
)
|
|
—
|
|
||
Benefit Obligation at End of Year
|
$
|
1,116,569
|
|
|
$
|
1,286,694
|
|
Change in Plan Assets
|
|
|
|
||||
Fair value of assets at beginning of year
|
$
|
2,343,471
|
|
|
$
|
2,042,490
|
|
Actual return on plan assets
|
(63,715
|
)
|
|
375,487
|
|
||
Benefits paid
|
(63,852
|
)
|
|
(74,506
|
)
|
||
Settlement
|
(95,777
|
)
|
|
—
|
|
||
Fair Value of Assets at End of Year
|
$
|
2,120,127
|
|
|
$
|
2,343,471
|
|
Funded Status
|
$
|
1,003,558
|
|
|
$
|
1,056,777
|
|
|
SERP
|
||||||
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Change in Benefit Obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
110,082
|
|
|
$
|
106,526
|
|
Service cost
|
819
|
|
|
858
|
|
||
Interest cost
|
3,865
|
|
|
4,233
|
|
||
Amendments
|
1,028
|
|
|
—
|
|
||
Actuarial (gain) loss
|
(7,552
|
)
|
|
4,041
|
|
||
Benefits paid
|
(5,694
|
)
|
|
(5,576
|
)
|
||
Benefit Obligation at End of Year
|
$
|
102,548
|
|
|
$
|
110,082
|
|
Change in Plan Assets
|
|
|
|
||||
Fair value of assets at beginning of year
|
$
|
—
|
|
|
$
|
—
|
|
Employer contributions
|
5,694
|
|
|
5,576
|
|
||
Benefits paid
|
(5,694
|
)
|
|
(5,576
|
)
|
||
Fair Value of Assets at End of Year
|
$
|
—
|
|
|
$
|
—
|
|
Funded Status
|
$
|
(102,548
|
)
|
|
$
|
(110,082
|
)
|
|
Pension Plans
|
|
SERP
|
||||||||||||
|
As of December 31
|
|
As of December 31
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Noncurrent asset
|
$
|
1,003,558
|
|
|
$
|
1,056,777
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Current liability
|
—
|
|
|
—
|
|
|
(6,321
|
)
|
|
(5,838
|
)
|
||||
Noncurrent liability
|
—
|
|
|
—
|
|
|
(96,227
|
)
|
|
(104,244
|
)
|
||||
Recognized Asset (Liability)
|
$
|
1,003,558
|
|
|
$
|
1,056,777
|
|
|
$
|
(102,548
|
)
|
|
$
|
(110,082
|
)
|
|
Pension Plans
|
|
SERP
|
||||
|
As of December 31
|
|
As of December 31
|
||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Discount rate
|
4.3%
|
|
3.6%
|
|
4.3%
|
|
3.6%
|
Rate of compensation increase – age graded
|
5.0%–1.0%
|
|
5.0%–1.0%
|
|
5.0%–1.0%
|
|
5.0%–1.0%
|
Cash balance interest crediting rate
|
3.50% with phase in to 4.30% in 2021
|
|
2.23% with phase in to 3.00% in 2020
|
|
—
|
|
—
|
(in thousands)
|
Pension Plans
|
|
SERP
|
||||
2019
|
$
|
76,245
|
|
|
$
|
6,456
|
|
2020
|
$
|
76,715
|
|
|
$
|
6,743
|
|
2021
|
$
|
75,956
|
|
|
$
|
6,946
|
|
2022
|
$
|
75,909
|
|
|
$
|
7,078
|
|
2023
|
$
|
75,389
|
|
|
$
|
7,149
|
|
2024–2028
|
$
|
367,130
|
|
|
$
|
35,656
|
|
|
Pension Plans
|
||||||||||
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Service cost
|
$
|
18,221
|
|
|
$
|
18,687
|
|
|
$
|
20,461
|
|
Interest cost
|
46,787
|
|
|
47,925
|
|
|
51,608
|
|
|||
Expected return on assets
|
(129,220
|
)
|
|
(121,411
|
)
|
|
(121,470
|
)
|
|||
Amortization of prior service cost
|
150
|
|
|
170
|
|
|
297
|
|
|||
Recognized actuarial gain
|
(9,969
|
)
|
|
(4,410
|
)
|
|
—
|
|
|||
Net Periodic Benefit for the Year
|
(74,031
|
)
|
|
(59,039
|
)
|
|
(49,104
|
)
|
|||
Curtailment
|
(806
|
)
|
|
—
|
|
|
—
|
|
|||
Settlement
|
(26,917
|
)
|
|
—
|
|
|
(17,993
|
)
|
|||
Early retirement programs and special separation benefit expense
|
—
|
|
|
1,825
|
|
|
—
|
|
|||
Total Benefit for the Year
|
$
|
(101,754
|
)
|
|
$
|
(57,214
|
)
|
|
$
|
(67,097
|
)
|
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income
|
|
|
|
|
|
||||||
Current year actuarial loss (gain)
|
$
|
111,084
|
|
|
$
|
(180,885
|
)
|
|
$
|
147,779
|
|
Current year prior service cost
|
7,183
|
|
|
75
|
|
|
—
|
|
|||
Amortization of prior service cost
|
(150
|
)
|
|
(170
|
)
|
|
(297
|
)
|
|||
Recognized net actuarial gain
|
9,969
|
|
|
4,410
|
|
|
—
|
|
|||
Curtailment and settlement
|
26,887
|
|
|
—
|
|
|
17,993
|
|
|||
Total Recognized in Other Comprehensive Income (Before Tax Effects)
|
$
|
154,973
|
|
|
$
|
(176,570
|
)
|
|
$
|
165,475
|
|
Total Recognized in Total Benefit and Other Comprehensive Income (Before Tax Effects)
|
$
|
53,219
|
|
|
$
|
(233,784
|
)
|
|
$
|
98,378
|
|
|
SERP
|
||||||||||
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Service cost
|
$
|
819
|
|
|
$
|
858
|
|
|
$
|
985
|
|
Interest cost
|
3,865
|
|
|
4,233
|
|
|
4,384
|
|
|||
Amortization of prior service cost
|
311
|
|
|
455
|
|
|
457
|
|
|||
Recognized actuarial loss
|
2,403
|
|
|
1,774
|
|
|
2,659
|
|
|||
Total Cost for the Year
|
$
|
7,398
|
|
|
$
|
7,320
|
|
|
$
|
8,485
|
|
Other Changes in Benefit Obligations Recognized in Other Comprehensive Income
|
|
|
|
|
|
||||||
Current year actuarial (gain) loss
|
$
|
(7,552
|
)
|
|
$
|
4,041
|
|
|
$
|
1,120
|
|
Current year prior service cost
|
1,028
|
|
|
—
|
|
|
—
|
|
|||
Amortization of prior service cost
|
(311
|
)
|
|
(455
|
)
|
|
(457
|
)
|
|||
Recognized net actuarial loss
|
(2,403
|
)
|
|
(1,774
|
)
|
|
(2,659
|
)
|
|||
Total Recognized in Other Comprehensive Income (Before Tax Effects)
|
$
|
(9,238
|
)
|
|
$
|
1,812
|
|
|
$
|
(1,996
|
)
|
Total Recognized in Total Cost and Other Comprehensive Income (Before Tax Effects)
|
$
|
(1,840
|
)
|
|
$
|
9,132
|
|
|
$
|
6,489
|
|
|
Pension Plans
|
|
SERP
|
||||||||
|
Year Ended December 31
|
|
Year Ended December 31
|
||||||||
|
2018
|
|
2017
|
|
2016
|
|
2018
|
|
2017
|
|
2016
|
Discount rate
(1)
|
4.0%/3.6%
|
|
4.1%
|
|
4.3%
|
|
3.6%
|
|
4.1%
|
|
4.3%
|
Expected return on plan assets
|
6.25%
|
|
6.25%
|
|
6.5%
|
|
—
|
|
—
|
|
—
|
Rate of compensation increase
|
Age graded
(5.0%–1.0%) |
|
Age graded
(5.0%–1.0%) |
|
4.0%
|
|
Age graded
(5.0%–1.0%) |
|
Age graded
(5.0%–1.0%) |
|
4.0%
|
Cash balance interest crediting rate
|
2.23% with phase in to 3.00% in 2020
|
|
1.57% with phase in to 3.00% in 2020
|
|
1.41% with phase in to 3.00% in 2019
|
|
—
|
|
—
|
|
—
|
(1)
|
As a result of the Kaplan University transaction, the Company remeasured the accumulated and projected benefit obligation of the pension plan as of March 22, 2018. The remeasurement changed the discount rate from 3.6% for the period January 1 to March 23, 2018 to 4.0% for the period after March 23, 2018.
|
|
Pension Plans
|
|
SERP
|
||||||||||||
|
As of December 31
|
|
As of December 31
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Unrecognized actuarial (gain) loss
|
$
|
(313,809
|
)
|
|
$
|
(461,779
|
)
|
|
$
|
17,270
|
|
|
$
|
27,225
|
|
Unrecognized prior service cost
|
7,273
|
|
|
270
|
|
|
1,037
|
|
|
320
|
|
||||
Gross Amount
|
(306,536
|
)
|
|
(461,509
|
)
|
|
18,307
|
|
|
27,545
|
|
||||
Deferred tax liability (asset)
|
82,765
|
|
|
124,607
|
|
|
(4,943
|
)
|
|
(7,437
|
)
|
||||
Net Amount
|
$
|
(223,771
|
)
|
|
$
|
(336,902
|
)
|
|
$
|
13,364
|
|
|
$
|
20,108
|
|
|
As of December 31
|
||||
|
2018
|
|
2017
|
||
U.S. equities
|
53
|
%
|
|
53
|
%
|
U.S. stock index fund
|
28
|
%
|
|
30
|
%
|
U.S. fixed income
|
13
|
%
|
|
11
|
%
|
International equities
|
6
|
%
|
|
6
|
%
|
|
100
|
%
|
|
100
|
%
|
|
As of December 31, 2018
|
||||||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash equivalents and other short-term investments
|
$
|
2,068
|
|
|
$
|
269,544
|
|
|
$
|
—
|
|
|
$
|
271,612
|
|
Equity securities
|
|
|
|
|
|
|
|
||||||||
U.S. equities
|
1,115,323
|
|
|
—
|
|
|
—
|
|
|
1,115,323
|
|
||||
International equities
|
131,912
|
|
|
—
|
|
|
—
|
|
|
131,912
|
|
||||
U.S. stock index fund
|
—
|
|
|
—
|
|
|
601,395
|
|
|
601,395
|
|
||||
Total Investments
|
$
|
1,249,303
|
|
|
$
|
269,544
|
|
|
$
|
601,395
|
|
|
$
|
2,120,242
|
|
Payable for settlement of investments purchased, net
|
|
|
|
|
|
|
(115
|
)
|
|||||||
Total
|
|
|
|
|
|
|
$
|
2,120,127
|
|
|
As of December 31, 2017
|
||||||||||||||
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash equivalents and other short-term investments
|
$
|
73,877
|
|
|
$
|
181,638
|
|
|
$
|
—
|
|
|
$
|
255,515
|
|
Equity securities
|
|
|
|
|
|
|
|
||||||||
U.S. equities
|
1,242,139
|
|
|
—
|
|
|
—
|
|
|
1,242,139
|
|
||||
International equities
|
138,640
|
|
|
—
|
|
|
—
|
|
|
138,640
|
|
||||
U.S. stock index fund
|
—
|
|
|
—
|
|
|
706,202
|
|
|
706,202
|
|
||||
Total Investments
|
$
|
1,454,656
|
|
|
$
|
181,638
|
|
|
$
|
706,202
|
|
|
$
|
2,342,496
|
|
Receivables
|
|
|
|
|
|
|
975
|
|
|||||||
Total
|
|
|
|
|
|
|
$
|
2,343,471
|
|
|
U.S. Stock Index Fund
|
||||||
|
Year Ended December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Balance at Beginning of Year
|
$
|
706,202
|
|
|
$
|
622,865
|
|
Purchases, sales, and settlements, net
|
(80,000
|
)
|
|
(50,000
|
)
|
||
Actual return on plan assets:
|
|
|
|
||||
Gains relating to assets sold
|
2,819
|
|
|
6,796
|
|
||
(Losses) gains relating to assets still held at year-end
|
(27,626
|
)
|
|
126,541
|
|
||
Balance at End of Year
|
$
|
601,395
|
|
|
$
|
706,202
|
|
|
Postretirement Plans
|
||||||
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Change in Benefit Obligation
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
22,785
|
|
|
$
|
24,171
|
|
Service cost
|
892
|
|
|
1,028
|
|
||
Interest cost
|
620
|
|
|
779
|
|
||
Amendments
|
(12,473
|
)
|
|
—
|
|
||
Actuarial gain
|
(2,519
|
)
|
|
(2,830
|
)
|
||
Acquisitions
|
—
|
|
|
516
|
|
||
Benefits paid, net of Medicare subsidy
|
(782
|
)
|
|
(879
|
)
|
||
Benefit Obligation at End of Year
|
$
|
8,523
|
|
|
$
|
22,785
|
|
Change in Plan Assets
|
|
|
|
||||
Fair value of assets at beginning of year
|
$
|
—
|
|
|
$
|
—
|
|
Employer contributions
|
782
|
|
|
879
|
|
||
Benefits paid, net of Medicare subsidy
|
(782
|
)
|
|
(879
|
)
|
||
Fair Value of Assets at End of Year
|
$
|
—
|
|
|
$
|
—
|
|
Funded Status
|
$
|
(8,523
|
)
|
|
$
|
(22,785
|
)
|
(in thousands)
|
Postretirement
Plans
|
||
2019
|
$
|
1,399
|
|
2020
|
$
|
1,273
|
|
2021
|
$
|
1,083
|
|
2022
|
$
|
1,015
|
|
2023
|
$
|
856
|
|
2024–2028
|
$
|
2,308
|
|
|
Postretirement Plans
|
||||||||||
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Service cost
|
$
|
892
|
|
|
$
|
1,028
|
|
|
$
|
1,386
|
|
Interest cost
|
620
|
|
|
779
|
|
|
1,230
|
|
|||
Amortization of prior service credit
|
(1,408
|
)
|
|
(148
|
)
|
|
(335
|
)
|
|||
Recognized actuarial gain
|
(3,783
|
)
|
|
(3,891
|
)
|
|
(1,502
|
)
|
|||
Net Periodic (Benefit) Cost for the Year
|
(3,679
|
)
|
|
(2,232
|
)
|
|
779
|
|
|||
Curtailment
|
(3,380
|
)
|
|
—
|
|
|
—
|
|
|||
Total (Benefit) Cost for the Year
|
$
|
(7,059
|
)
|
|
$
|
(2,232
|
)
|
|
$
|
779
|
|
Other Changes in Benefit Obligations Recognized in Other Comprehensive Income
|
|
|
|
|
|
||||||
Current year actuarial gain
|
$
|
(2,519
|
)
|
|
$
|
(2,830
|
)
|
|
$
|
(14,984
|
)
|
Current year prior service credit
|
(12,473
|
)
|
|
—
|
|
|
—
|
|
|||
Amortization of prior service credit
|
1,408
|
|
|
148
|
|
|
335
|
|
|||
Recognized actuarial gain
|
3,783
|
|
|
3,891
|
|
|
1,502
|
|
|||
Curtailment and settlement
|
3,380
|
|
|
—
|
|
|
—
|
|
|||
Total Recognized in Other Comprehensive Income (Before Tax Effects)
|
$
|
(6,421
|
)
|
|
$
|
1,209
|
|
|
$
|
(13,147
|
)
|
Total Recognized in (Benefit) Cost and Other Comprehensive Income (Before Tax Effects)
|
$
|
(13,480
|
)
|
|
$
|
(1,023
|
)
|
|
$
|
(12,368
|
)
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Unrecognized actuarial gain
|
$
|
(22,861
|
)
|
|
$
|
(24,125
|
)
|
Unrecognized prior service credit
|
(7,863
|
)
|
|
(178
|
)
|
||
Gross Amount
|
(30,724
|
)
|
|
(24,303
|
)
|
||
Deferred tax liability
|
8,295
|
|
|
6,561
|
|
||
Net Amount
|
$
|
(22,429
|
)
|
|
$
|
(17,742
|
)
|
15.
|
OTHER NON-OPERATING INCOME (EXPENSE)
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Loss on guarantor obligations
|
$
|
(17,518
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Net gain on cost method investments
|
11,663
|
|
|
—
|
|
|
—
|
|
|||
Net gain (loss) on sales of businesses
|
8,157
|
|
|
(569
|
)
|
|
18,931
|
|
|||
Foreign currency (loss) gain, net
|
(3,844
|
)
|
|
3,310
|
|
|
(39,890
|
)
|
|||
Gain on sale of cost method investments
|
2,845
|
|
|
16
|
|
|
794
|
|
|||
Impairment of cost method investments
|
(2,697
|
)
|
|
(200
|
)
|
|
(29,365
|
)
|
|||
Net gain on sale of property, plant and equipment
|
2,539
|
|
|
—
|
|
|
34,072
|
|
|||
Gain on formation of a joint venture
|
—
|
|
|
—
|
|
|
3,232
|
|
|||
Net losses on sales or write-down of marketable equity securities
|
—
|
|
|
—
|
|
|
(1,791
|
)
|
|||
Other, net
|
958
|
|
|
1,684
|
|
|
1,375
|
|
|||
Total Other Non-Operating Income (Expense)
|
$
|
2,103
|
|
|
$
|
4,241
|
|
|
$
|
(12,642
|
)
|
16.
|
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
|
|
Year Ended December 31, 2018
|
||||||||||
|
Before-Tax
|
|
Income
|
|
After-Tax
|
||||||
(in thousands)
|
Amount
|
|
Tax
|
|
Amount
|
||||||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the year
|
$
|
(35,584
|
)
|
|
$
|
—
|
|
|
$
|
(35,584
|
)
|
Pension and other postretirement plans:
|
|
|
|
|
|
||||||
Actuarial loss
|
(101,013
|
)
|
|
27,273
|
|
|
(73,740
|
)
|
|||
Prior service credit
|
4,262
|
|
|
(1,151
|
)
|
|
3,111
|
|
|||
Amortization of net actuarial gain included in net income
|
(11,349
|
)
|
|
3,064
|
|
|
(8,285
|
)
|
|||
Amortization of net prior service credit included in net income
|
(947
|
)
|
|
256
|
|
|
(691
|
)
|
|||
Curtailments and settlements included in net income
|
(30,267
|
)
|
|
8,172
|
|
|
(22,095
|
)
|
|||
|
(139,314
|
)
|
|
37,614
|
|
|
(101,700
|
)
|
|||
Cash flow hedge:
|
|
|
|
|
|
||||||
Gain for the year
|
551
|
|
|
(104
|
)
|
|
447
|
|
|||
Other Comprehensive Loss
|
$
|
(174,347
|
)
|
|
$
|
37,510
|
|
|
$
|
(136,837
|
)
|
|
Year Ended December 31, 2017
|
||||||||||
|
Before-Tax
|
|
Income
|
|
After-Tax
|
||||||
(in thousands)
|
Amount
|
|
Tax
|
|
Amount
|
||||||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the year
|
$
|
33,175
|
|
|
$
|
—
|
|
|
$
|
33,175
|
|
Adjustment for sale of a business with foreign operations
|
137
|
|
|
—
|
|
|
137
|
|
|||
|
33,312
|
|
|
—
|
|
|
33,312
|
|
|||
Unrealized gains on available-for-sale securities:
|
|
|
|
|
|
||||||
Unrealized gains for the year
|
112,086
|
|
|
(44,834
|
)
|
|
67,252
|
|
|||
Pension and other postretirement plans:
|
|
|
|
|
|
||||||
Actuarial gain
|
179,674
|
|
|
(48,511
|
)
|
|
131,163
|
|
|||
Prior service cost
|
(75
|
)
|
|
20
|
|
|
(55
|
)
|
|||
Amortization of net actuarial gain included in net income
|
(6,527
|
)
|
|
2,612
|
|
|
(3,915
|
)
|
|||
Amortization of net prior service cost included in net income
|
477
|
|
|
(191
|
)
|
|
286
|
|
|||
|
173,549
|
|
|
(46,070
|
)
|
|
127,479
|
|
|||
Cash flow hedge:
|
|
|
|
|
|
||||||
Gain for the year
|
112
|
|
|
(19
|
)
|
|
93
|
|
|||
Other Comprehensive Income
|
$
|
319,059
|
|
|
$
|
(90,923
|
)
|
|
$
|
228,136
|
|
|
Year Ended December 31, 2016
|
||||||||||
|
Before-Tax
|
|
Income
|
|
After-Tax
|
||||||
(in thousands)
|
Amount
|
|
Tax
|
|
Amount
|
||||||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the year
|
$
|
(22,149
|
)
|
|
$
|
—
|
|
|
$
|
(22,149
|
)
|
Unrealized gains on available-for-sale securities:
|
|
|
|
|
|
||||||
Unrealized gains for the year
|
55,507
|
|
|
(22,203
|
)
|
|
33,304
|
|
|||
Reclassification adjustment for realization of loss on sale of available-for-sale securities included in net income
|
1,879
|
|
|
(752
|
)
|
|
1,127
|
|
|||
|
57,386
|
|
|
(22,955
|
)
|
|
34,431
|
|
|||
Pension and other postretirement plans:
|
|
|
|
|
|
||||||
Actuarial loss
|
(133,915
|
)
|
|
53,566
|
|
|
(80,349
|
)
|
|||
Amortization of net actuarial loss included in net income
|
1,157
|
|
|
(463
|
)
|
|
694
|
|
|||
Amortization of net prior service cost included in net income
|
419
|
|
|
(167
|
)
|
|
252
|
|
|||
Curtailments and settlements included in net income
|
(17,993
|
)
|
|
7,197
|
|
|
(10,796
|
)
|
|||
|
(150,332
|
)
|
|
60,133
|
|
|
(90,199
|
)
|
|||
Cash flow hedge:
|
|
|
|
|
|
||||||
Loss for the year
|
(334
|
)
|
|
57
|
|
|
(277
|
)
|
|||
Other Comprehensive Loss
|
$
|
(115,429
|
)
|
|
$
|
37,235
|
|
|
$
|
(78,194
|
)
|
(in thousands, net of taxes)
|
Cumulative
Foreign
Currency
Translation
Adjustment
|
|
Unrealized Gain on Available-for-Sale Securities
|
|
Unrealized Gain
on Pensions
and Other
Postretirement
Plans
|
|
Cash Flow
Hedge
|
|
Accumulated
Other
Comprehensive
Income
|
||||||||||
As of December 31, 2016
|
$
|
(26,998
|
)
|
|
$
|
92,931
|
|
|
$
|
170,830
|
|
|
$
|
(277
|
)
|
|
$
|
236,486
|
|
Other comprehensive income (loss) before reclassifications
|
33,175
|
|
|
67,252
|
|
|
131,108
|
|
|
(29
|
)
|
|
231,506
|
|
|||||
Net amount reclassified from accumulated other comprehensive income
|
137
|
|
|
—
|
|
|
(3,629
|
)
|
|
122
|
|
|
(3,370
|
)
|
|||||
Net other comprehensive income
|
33,312
|
|
|
67,252
|
|
|
127,479
|
|
|
93
|
|
|
228,136
|
|
|||||
Reclassification of stranded tax effects to retained earnings as a result of tax reform
|
—
|
|
|
34,706
|
|
|
36,227
|
|
|
—
|
|
|
70,933
|
|
|||||
As of December 31, 2017
|
6,314
|
|
|
194,889
|
|
|
334,536
|
|
|
(184
|
)
|
|
535,555
|
|
|||||
Reclassification of unrealized gains on available-for-sale securities to retained earnings as a result of adoption of new guidance
|
—
|
|
|
(194,889
|
)
|
|
—
|
|
|
—
|
|
|
(194,889
|
)
|
|||||
Other comprehensive (loss) income before reclassifications
|
(35,584
|
)
|
|
—
|
|
|
(70,629
|
)
|
|
579
|
|
|
(105,634
|
)
|
|||||
Net amount reclassified from accumulated other comprehensive income
|
—
|
|
|
—
|
|
|
(31,071
|
)
|
|
(132
|
)
|
|
(31,203
|
)
|
|||||
Net other comprehensive (loss) income
|
(35,584
|
)
|
|
—
|
|
|
(101,700
|
)
|
|
447
|
|
|
(136,837
|
)
|
|||||
As of December 31, 2018
|
$
|
(29,270
|
)
|
|
$
|
—
|
|
|
$
|
232,836
|
|
|
$
|
263
|
|
|
$
|
203,829
|
|
|
Year Ended December 31
|
|
Affected Line Item in the Consolidated Statements of Operations
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
|
|||||||
Foreign Currency Translation Adjustments:
|
|
|
|
|
|
|
|
||||||
Adjustment for sales of businesses with foreign operations
|
$
|
—
|
|
|
$
|
137
|
|
|
$
|
—
|
|
|
Other income (expense), net
|
Unrealized Gains on Available-for-Sale Securities:
|
|
|
|
|
|
|
|
||||||
Realized loss for the year
|
—
|
|
|
—
|
|
|
1,879
|
|
|
Other income (expense), net
|
|||
|
—
|
|
|
—
|
|
|
(752
|
)
|
|
Provision for (benefit from) income taxes
|
|||
|
—
|
|
|
—
|
|
|
1,127
|
|
|
Net of tax
|
|||
Pension and Other Postretirement Plans:
|
|
|
|
|
|
|
|
||||||
Amortization of net actuarial (gain) loss
|
(11,349
|
)
|
|
(6,527
|
)
|
|
1,157
|
|
|
(1)
|
|||
Amortization of net prior service (credit) cost
|
(947
|
)
|
|
477
|
|
|
419
|
|
|
(1)
|
|||
Curtailment and settlement gains
|
(30,267
|
)
|
|
—
|
|
|
(17,993
|
)
|
|
(1)
|
|||
|
(42,563
|
)
|
|
(6,050
|
)
|
|
(16,417
|
)
|
|
Before tax
|
|||
|
11,492
|
|
|
2,421
|
|
|
6,567
|
|
|
Provision for (benefit from) income taxes
|
|||
|
(31,071
|
)
|
|
(3,629
|
)
|
|
(9,850
|
)
|
|
Net of tax
|
|||
Cash Flow Hedge
|
|
|
|
|
|
|
|
||||||
|
(163
|
)
|
|
152
|
|
|
16
|
|
|
Interest expense
|
|||
|
31
|
|
|
(30
|
)
|
|
(3
|
)
|
|
Provision for (benefit from) income taxes
|
|||
|
(132
|
)
|
|
122
|
|
|
13
|
|
|
Net of tax
|
|||
Total reclassification for the year
|
$
|
(31,203
|
)
|
|
$
|
(3,370
|
)
|
|
$
|
(8,710
|
)
|
|
Net of tax
|
(1)
|
These accumulated other comprehensive income components are included in the computation of net periodic pension and postretirement plan cost (see Note 14) and are included in non-operating pension and postretirement benefit income in the Company’s Consolidated Statements of Operations.
|
17.
|
LEASES AND OTHER COMMITMENTS
|
(in thousands)
|
|
||
2019
|
$
|
101,009
|
|
2020
|
84,945
|
|
|
2021
|
72,031
|
|
|
2022
|
53,709
|
|
|
2023
|
47,091
|
|
|
Thereafter
|
115,948
|
|
|
|
$
|
474,733
|
|
18.
|
CONTINGENCIES
|
19.
|
BUSINESS SEGMENTS
|
|
Year Ended December 31
|
||||||
(in thousands)
|
2017
|
|
2016
|
||||
Accelerated depreciation
|
$
|
339
|
|
|
$
|
1,815
|
|
Lease obligation losses
|
—
|
|
|
2,694
|
|
||
Severance
|
6,099
|
|
|
5,902
|
|
||
Other
|
2,627
|
|
|
1,441
|
|
||
|
$
|
9,065
|
|
|
$
|
11,852
|
|
•
|
Hoover, a Thomson, GA-based supplier of pressure impregnated kiln-dried lumber and plywood products for fire retardant and preservative applications (acquired in April 2017); Dekko, a Garrett, IN-based manufacturer of electrical workspace solutions, architectural lighting, and electrical components and assemblies; Joyce/Dayton Corp., a Dayton, OH-based manufacturer of screw jacks and other linear motion systems; and Forney, a global supplier of products and systems that control and monitor combustion processes in electric utility and industrial applications;
|
•
|
SocialCode, a marketing and insights company that manages digital advertising for leading brands; The Slate Group and Foreign Policy Group, which publish online and print magazines and websites; and three investment stage businesses, Panoply, Pinna and CyberVista.
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Operating Revenues
|
|
|
|
|
|
||||||
Education
|
$
|
1,451,015
|
|
|
$
|
1,516,776
|
|
|
$
|
1,598,461
|
|
Television broadcasting
|
505,549
|
|
|
409,916
|
|
|
409,718
|
|
|||
Healthcare
|
149,275
|
|
|
154,202
|
|
|
146,962
|
|
|||
Other businesses
|
590,227
|
|
|
511,003
|
|
|
326,888
|
|
|||
Corporate office
|
—
|
|
|
—
|
|
|
—
|
|
|||
Intersegment elimination
|
(100
|
)
|
|
(51
|
)
|
|
(139
|
)
|
|||
|
$
|
2,695,966
|
|
|
$
|
2,591,846
|
|
|
$
|
2,481,890
|
|
Income (Loss) from Operations
|
|
|
|
|
|
||||||
Education
|
$
|
97,136
|
|
|
$
|
77,687
|
|
|
$
|
95,321
|
|
Television broadcasting
|
210,533
|
|
|
139,258
|
|
|
202,863
|
|
|||
Healthcare
|
(8,401
|
)
|
|
(2,569
|
)
|
|
2,799
|
|
|||
Other businesses
|
(246
|
)
|
|
(19,263
|
)
|
|
(24,901
|
)
|
|||
Corporate office
|
(52,861
|
)
|
|
(58,710
|
)
|
|
(53,213
|
)
|
|||
|
$
|
246,161
|
|
|
$
|
136,403
|
|
|
$
|
222,869
|
|
Equity in Earnings (Losses) of Affiliates, Net
|
14,473
|
|
|
(3,249
|
)
|
|
(7,937
|
)
|
|||
Interest Expense, Net
|
(32,549
|
)
|
|
(27,305
|
)
|
|
(32,297
|
)
|
|||
Debt Extinguishment Costs
|
(11,378
|
)
|
|
—
|
|
|
—
|
|
|||
Non-Operating Pension and Postretirement Benefit Income, Net
|
120,541
|
|
|
72,699
|
|
|
80,665
|
|
|||
Loss on Marketable Equity Securities, net
|
(15,843
|
)
|
|
—
|
|
|
—
|
|
|||
Other Income (Expense), Net
|
2,103
|
|
|
4,241
|
|
|
(12,642
|
)
|
|||
Income Before Income Taxes
|
$
|
323,508
|
|
|
$
|
182,789
|
|
|
$
|
250,658
|
|
Depreciation of Property, Plant and Equipment
|
|
|
|
|
|
||||||
Education
|
$
|
28,099
|
|
|
$
|
32,906
|
|
|
$
|
41,187
|
|
Television broadcasting
|
13,204
|
|
|
12,179
|
|
|
9,942
|
|
|||
Healthcare
|
2,577
|
|
|
4,583
|
|
|
2,805
|
|
|||
Other businesses
|
11,835
|
|
|
11,723
|
|
|
9,570
|
|
|||
Corporate office
|
1,007
|
|
|
1,118
|
|
|
1,116
|
|
|||
|
$
|
56,722
|
|
|
$
|
62,509
|
|
|
$
|
64,620
|
|
Amortization of Intangible Assets and Impairment of Goodwill and
|
|
|
|
|
|
||||||
Other Long-Lived Assets
|
|
|
|
|
|
||||||
Education
|
$
|
9,362
|
|
|
$
|
5,162
|
|
|
$
|
7,516
|
|
Television broadcasting
|
5,632
|
|
|
6,349
|
|
|
251
|
|
|||
Healthcare
|
14,855
|
|
|
7,905
|
|
|
6,701
|
|
|||
Other businesses
|
25,674
|
|
|
31,385
|
|
|
13,806
|
|
|||
Corporate office
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
$
|
55,523
|
|
|
$
|
50,801
|
|
|
$
|
28,274
|
|
Pension Service Cost
|
|
|
|
|
|
||||||
Education
|
$
|
8,753
|
|
|
$
|
9,720
|
|
|
$
|
11,803
|
|
Television broadcasting
|
2,188
|
|
|
1,942
|
|
|
1,714
|
|
|||
Healthcare
|
573
|
|
|
665
|
|
|
—
|
|
|||
Other businesses
|
1,373
|
|
|
1,125
|
|
|
1,118
|
|
|||
Corporate office
|
5,334
|
|
|
5,235
|
|
|
5,826
|
|
|||
|
$
|
18,221
|
|
|
$
|
18,687
|
|
|
$
|
20,461
|
|
Capital Expenditures
|
|
|
|
|
|
||||||
Education
|
$
|
54,159
|
|
|
$
|
27,520
|
|
|
$
|
26,497
|
|
Television broadcasting
|
27,013
|
|
|
16,802
|
|
|
27,453
|
|
|||
Healthcare
|
1,741
|
|
|
2,987
|
|
|
2,954
|
|
|||
Other businesses
|
15,154
|
|
|
9,771
|
|
|
13,093
|
|
|||
Corporate office
|
—
|
|
|
—
|
|
|
715
|
|
|||
|
$
|
98,067
|
|
|
$
|
57,080
|
|
|
$
|
70,712
|
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Identifiable Assets
|
|
|
|
||||
Education
|
$
|
1,568,747
|
|
|
$
|
1,592,097
|
|
Television broadcasting
|
452,853
|
|
|
455,884
|
|
||
Healthcare
|
108,596
|
|
|
129,856
|
|
||
Other businesses
|
827,113
|
|
|
855,399
|
|
||
Corporate office
|
162,971
|
|
|
182,905
|
|
||
|
$
|
3,120,280
|
|
|
$
|
3,216,141
|
|
Investments in Marketable Equity Securities
|
496,390
|
|
|
536,315
|
|
||
Investments in Affiliates
|
143,813
|
|
|
128,590
|
|
||
Prepaid Pension Cost
|
1,003,558
|
|
|
1,056,777
|
|
||
Total Assets
|
$
|
4,764,041
|
|
|
$
|
4,937,823
|
|
|
Year Ended December 31
|
||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Operating Revenues
|
|
|
|
|
|
||||||
Kaplan international
|
$
|
719,982
|
|
|
$
|
697,999
|
|
|
$
|
696,362
|
|
Higher education
|
342,085
|
|
|
431,425
|
|
|
501,784
|
|
|||
Test preparation
|
256,102
|
|
|
273,298
|
|
|
286,556
|
|
|||
Professional (U.S.)
|
134,187
|
|
|
115,839
|
|
|
115,263
|
|
|||
Kaplan corporate and other
|
1,142
|
|
|
294
|
|
|
214
|
|
|||
Intersegment elimination
|
(2,483
|
)
|
|
(2,079
|
)
|
|
(1,718
|
)
|
|||
|
$
|
1,451,015
|
|
|
$
|
1,516,776
|
|
|
$
|
1,598,461
|
|
Income (Loss) from Operations
|
|
|
|
|
|
|
|
|
|||
Kaplan international
|
$
|
70,315
|
|
|
$
|
51,623
|
|
|
$
|
48,398
|
|
Higher education
|
15,217
|
|
|
16,719
|
|
|
39,196
|
|
|||
Test preparation
|
19,096
|
|
|
11,507
|
|
|
9,599
|
|
|||
Professional (U.S.)
|
28,608
|
|
|
27,558
|
|
|
27,436
|
|
|||
Kaplan corporate and other
|
(36,064
|
)
|
|
(29,863
|
)
|
|
(29,279
|
)
|
|||
Intersegment elimination
|
(36
|
)
|
|
143
|
|
|
(29
|
)
|
|||
|
$
|
97,136
|
|
|
$
|
77,687
|
|
|
$
|
95,321
|
|
Depreciation of Property, Plant and Equipment
|
|
|
|
|
|
||||||
Kaplan international
|
$
|
15,755
|
|
|
$
|
14,892
|
|
|
$
|
17,523
|
|
Higher education
|
4,826
|
|
|
9,117
|
|
|
13,816
|
|
|||
Test preparation
|
3,941
|
|
|
5,286
|
|
|
6,287
|
|
|||
Professional (U.S.)
|
3,096
|
|
|
3,041
|
|
|
3,006
|
|
|||
Kaplan corporate and other
|
481
|
|
|
570
|
|
|
555
|
|
|||
|
$
|
28,099
|
|
|
$
|
32,906
|
|
|
$
|
41,187
|
|
Amortization of Intangible Assets
|
$
|
9,362
|
|
|
$
|
5,162
|
|
|
$
|
7,516
|
|
Pension Service Cost
|
|
|
|
|
|
||||||
Kaplan international
|
$
|
298
|
|
|
$
|
264
|
|
|
$
|
268
|
|
Higher education
|
4,310
|
|
|
5,269
|
|
|
6,544
|
|
|||
Test preparation
|
2,611
|
|
|
2,755
|
|
|
3,072
|
|
|||
Professional (U.S.)
|
1,162
|
|
|
913
|
|
|
1,076
|
|
|||
Kaplan corporate and other
|
372
|
|
|
519
|
|
|
843
|
|
|||
|
$
|
8,753
|
|
|
$
|
9,720
|
|
|
$
|
11,803
|
|
Capital Expenditures
|
|
|
|
|
|
|
|
|
|||
Kaplan international
|
$
|
44,469
|
|
|
$
|
21,667
|
|
|
$
|
16,252
|
|
Higher education
|
4,045
|
|
|
2,158
|
|
|
3,140
|
|
|||
Test preparation
|
681
|
|
|
1,038
|
|
|
4,672
|
|
|||
Professional (U.S.)
|
4,845
|
|
|
2,475
|
|
|
2,224
|
|
|||
Kaplan corporate and other
|
119
|
|
|
182
|
|
|
209
|
|
|||
|
$
|
54,159
|
|
|
$
|
27,520
|
|
|
$
|
26,497
|
|
|
As of December 31
|
||||||
(in thousands)
|
2018
|
|
2017
|
||||
Identifiable Assets
|
|
|
|
||||
Kaplan international
|
$
|
1,101,040
|
|
|
$
|
1,115,919
|
|
Higher education
|
126,752
|
|
|
231,986
|
|
||
Test preparation
|
145,308
|
|
|
130,938
|
|
||
Professional (U.S.)
|
166,916
|
|
|
91,630
|
|
||
Kaplan corporate and other
|
28,731
|
|
|
21,624
|
|
||
|
$
|
1,568,747
|
|
|
$
|
1,592,097
|
|
20.
|
SUMMARY OF QUARTERLY OPERATING RESULTS AND COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
|
(in thousands, except per share amounts)
|
First
Quarter
|
|
Second Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
Operating Revenues
|
$
|
659,436
|
|
|
$
|
672,677
|
|
|
$
|
674,766
|
|
|
$
|
689,087
|
|
Operating Costs and Expenses
|
|
|
|
|
|
|
|
||||||||
Operating
|
365,151
|
|
|
440,655
|
|
|
448,920
|
|
|
432,706
|
|
||||
Selling, general and administrative
|
225,045
|
|
|
141,378
|
|
|
131,081
|
|
|
152,624
|
|
||||
Depreciation of property, plant and equipment
|
14,642
|
|
|
13,619
|
|
|
13,648
|
|
|
14,813
|
|
||||
Amortization of intangible assets
|
10,384
|
|
|
11,399
|
|
|
12,269
|
|
|
13,362
|
|
||||
Impairment of goodwill and other long-lived assets
|
—
|
|
|
—
|
|
|
8,109
|
|
|
—
|
|
||||
|
615,222
|
|
|
607,051
|
|
|
614,027
|
|
|
613,505
|
|
||||
Income from Operations
|
44,214
|
|
|
65,626
|
|
|
60,739
|
|
|
75,582
|
|
||||
Equity in earnings of affiliates, net
|
2,579
|
|
|
931
|
|
|
9,537
|
|
|
1,426
|
|
||||
Interest income
|
1,372
|
|
|
1,901
|
|
|
611
|
|
|
1,469
|
|
||||
Interest expense
|
(8,071
|
)
|
|
(17,165
|
)
|
|
(6,135
|
)
|
|
(6,531
|
)
|
||||
Debt extinguishment costs
|
—
|
|
|
(11,378
|
)
|
|
—
|
|
|
—
|
|
||||
Non-operating pension and postretirement benefit income, net
|
21,386
|
|
|
23,041
|
|
|
22,214
|
|
|
53,900
|
|
||||
(Loss) gain on marketable equity securities, net
|
(14,102
|
)
|
|
(2,554
|
)
|
|
44,962
|
|
|
(44,149
|
)
|
||||
Other income (expense), net
|
9,187
|
|
|
2,333
|
|
|
3,142
|
|
|
(12,559
|
)
|
||||
Income Before Income Taxes
|
56,565
|
|
|
62,735
|
|
|
135,070
|
|
|
69,138
|
|
||||
Provision for Income Taxes
|
13,600
|
|
|
16,100
|
|
|
10,000
|
|
|
12,400
|
|
||||
Net Income
|
42,965
|
|
|
46,635
|
|
|
125,070
|
|
|
56,738
|
|
||||
Net Income Attributable to Noncontrolling Interests
|
(74
|
)
|
|
(69
|
)
|
|
(6
|
)
|
|
(53
|
)
|
||||
Net Income Attributable to Graham Holdings Company Common Stockholders
|
$
|
42,891
|
|
|
$
|
46,566
|
|
|
$
|
125,064
|
|
|
$
|
56,685
|
|
Quarterly Comprehensive Income (Loss)
|
$
|
53,703
|
|
|
$
|
13,345
|
|
|
$
|
119,862
|
|
|
$
|
(52,541
|
)
|
|
|
|
|
|
|
|
|
||||||||
Per Share Information Attributable to Graham Holdings Company Common Stockholders
|
|
|
|
|
|
|
|
||||||||
Basic net income per common share
|
$
|
7.84
|
|
|
$
|
8.69
|
|
|
$
|
23.43
|
|
|
$
|
10.69
|
|
Basic average number of common shares outstanding
|
5,436
|
|
|
5,325
|
|
|
5,302
|
|
|
5,270
|
|
||||
Diluted net income per common share
|
$
|
7.78
|
|
|
$
|
8.63
|
|
|
$
|
23.28
|
|
|
$
|
10.61
|
|
Diluted average number of common shares outstanding
|
5,473
|
|
|
5,362
|
|
|
5,337
|
|
|
5,309
|
|
(in thousands, except per share amounts)
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
Operating Revenues
|
$
|
582,717
|
|
|
$
|
676,087
|
|
|
$
|
657,225
|
|
|
$
|
675,817
|
|
Operating Costs and Expenses
|
|
|
|
|
|
|
|
||||||||
Operating
|
325,687
|
|
|
381,747
|
|
|
374,987
|
|
|
371,922
|
|
||||
Selling, general and administrative
|
225,289
|
|
|
208,973
|
|
|
228,051
|
|
|
225,477
|
|
||||
Depreciation of property, plant and equipment
|
14,652
|
|
|
15,871
|
|
|
16,002
|
|
|
15,984
|
|
||||
Amortization of intangible assets
|
6,836
|
|
|
10,531
|
|
|
10,923
|
|
|
12,897
|
|
||||
Impairment of goodwill and other long-lived assets
|
—
|
|
|
9,224
|
|
|
312
|
|
|
78
|
|
||||
|
572,464
|
|
|
626,346
|
|
|
630,275
|
|
|
626,358
|
|
||||
Income from Operations
|
10,253
|
|
|
49,741
|
|
|
26,950
|
|
|
49,459
|
|
||||
Equity in earnings (losses) of affiliates, net
|
649
|
|
|
1,331
|
|
|
(532
|
)
|
|
(4,697
|
)
|
||||
Interest income
|
1,363
|
|
|
1,173
|
|
|
861
|
|
|
3,184
|
|
||||
Interest expense
|
(8,129
|
)
|
|
(9,035
|
)
|
|
(8,619
|
)
|
|
(8,103
|
)
|
||||
Non-operating pension and postretirement benefit income, net
|
18,801
|
|
|
18,620
|
|
|
17,621
|
|
|
17,657
|
|
||||
Other income (expense), net
|
849
|
|
|
4,069
|
|
|
1,963
|
|
|
(2,640
|
)
|
||||
Income Before Income Taxes
|
23,786
|
|
|
65,899
|
|
|
38,244
|
|
|
54,860
|
|
||||
Provision for (Benefit From) Income Taxes
|
2,700
|
|
|
23,900
|
|
|
13,400
|
|
|
(159,700
|
)
|
||||
Net Income
|
21,086
|
|
|
41,999
|
|
|
24,844
|
|
|
214,560
|
|
||||
Net Income Attributable to Noncontrolling Interests
|
—
|
|
|
(3
|
)
|
|
(60
|
)
|
|
(382
|
)
|
||||
Net Income Attributable to Graham Holdings Company Common Stockholders
|
$
|
21,086
|
|
|
$
|
41,996
|
|
|
$
|
24,784
|
|
|
$
|
214,178
|
|
Quarterly Comprehensive Income
|
$
|
39,368
|
|
|
$
|
59,135
|
|
|
$
|
64,029
|
|
|
$
|
367,648
|
|
|
|
|
|
|
|
|
|
||||||||
Per Share Information Attributable to Graham Holdings Company Common Stockholders
|
|
|
|
|
|
|
|
||||||||
Basic net income per common share
|
$
|
3.77
|
|
|
$
|
7.51
|
|
|
$
|
4.45
|
|
|
$
|
38.76
|
|
Basic average number of common shares outstanding
|
5,535
|
|
|
5,539
|
|
|
5,518
|
|
|
5,473
|
|
||||
Diluted net income per common share
|
$
|
3.75
|
|
|
$
|
7.46
|
|
|
$
|
4.42
|
|
|
$
|
38.52
|
|
Diluted average number of common shares outstanding
|
5,569
|
|
|
5,577
|
|
|
5,554
|
|
|
5,509
|
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
2018
|
|
|
|
|
|
|
|
|||||||||
|
Intangible asset impairment charge of $5.8 million at the healthcare business
|
|
|
|
|
$
|
(1.08
|
)
|
|
|
||||||
|
A $3.0 million reduction to operating expenses from property, plant, and equipment gains in connection with the spectrum repacking mandate of the FCC ($0.2 million, $0.6 million, $0.8 million and $1.4 million in the first, second, third and fourth quarters, respectively)
|
$
|
0.04
|
|
|
$
|
0.11
|
|
|
$
|
0.14
|
|
|
$
|
0.26
|
|
|
Interest expense of $6.2 million related to the settlement of a mandatorily redeemable noncontrolling interest
|
|
|
$
|
(1.14
|
)
|
|
|
|
|
||||||
|
Debt extinguishment costs of $8.6 million
|
|
|
$
|
(1.60
|
)
|
|
|
|
|
||||||
|
A $22.2 million settlement gain related to a bulk lump sum pension offering and curtailment gain related to changes in the Company’s postretirement healthcare benefit plan
|
|
|
|
|
|
|
$
|
4.11
|
|
||||||
|
Losses, net, of $12.6 million on marketable equity securities ($10.7 million loss, $1.9 million loss, $33.6 million gain, and $33.6 million loss in the first, second, third and fourth quarters, respectively)
|
$
|
(1.94
|
)
|
|
$
|
(0.36
|
)
|
|
$
|
6.26
|
|
|
$
|
(6.28
|
)
|
|
Non-operating gain, net, of $5.7 million from sales, write-ups and impairments of cost method and equity method investments, and related to sales of land and businesses, including losses on guarantor lease obligations ($3.6 million gain, $1.8 million gain, $8.0 million gain, and $7.7 million loss in the first, second, third and fourth quarters, respectively)
|
$
|
0.65
|
|
|
$
|
0.34
|
|
|
$
|
1.48
|
|
|
$
|
(1.43
|
)
|
|
Gain of $1.8 million on the Kaplan University Transaction
|
$
|
0.33
|
|
|
|
|
|
|
|
||||||
|
Losses, net, of $2.9 million for non-operating foreign currency (losses) gains ($0.1 million gain, $1.7 million loss, $0.1 million loss, and $1.2 million loss in the first, second, third and fourth quarters, respectively)
|
$
|
0.02
|
|
|
$
|
(0.32
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.23
|
)
|
|
A nonrecurring discrete $17.8 million deferred state tax benefit related to the release of valuation allowances
|
|
|
|
|
$
|
3.31
|
|
|
|
||||||
|
Income tax benefit of $1.8 million related to stock compensation
|
$
|
0.33
|
|
|
|
|
|
|
|
2017
|
|
|
|
|
|
|
|
|||||||||
|
Charges of $6.3 million related to restructuring and non-operating Separation Incentive Program charges at the education division ($0.3 million, $0.4 million, $1.1 million and $4.5 million in the first, second, third and fourth quarters, respectively)
|
$
|
(0.05
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.20
|
)
|
|
$
|
(0.81
|
)
|
|
Goodwill and long-lived assets impairment charges of $5.8 million at other businesses
|
|
|
$
|
(1.03
|
)
|
|
|
|
|
||||||
|
Gains, net, of $2.1 million for non-operating foreign currency gains (losses) ($1.1 million gain, $2.2 million gain, $0.9 million gain and $2.1 million loss in the first, second, third and fourth quarters, respectively)
|
$
|
0.19
|
|
|
$
|
0.39
|
|
|
$
|
0.16
|
|
|
$
|
(0.37
|
)
|
|
Net deferred tax benefits of $177.5 million related to the Tax Act
|
|
|
|
|
|
|
$
|
31.68
|
|
||||||
|
Income tax benefit of $5.9 million related to stock compensation
|
$
|
1.06
|
|
|
|
|
|
|
|
(in thousands, except per share amounts)
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
Results of Operations
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating revenues
|
$
|
2,695,966
|
|
|
$
|
2,591,846
|
|
|
$
|
2,481,890
|
|
|
$
|
2,586,114
|
|
|
$
|
2,737,032
|
|
Income (loss) from operations
|
246,161
|
|
|
136,403
|
|
|
222,869
|
|
|
(158,140
|
)
|
|
149,402
|
|
|||||
Income (loss) from continuing operations
|
271,408
|
|
|
302,489
|
|
|
169,458
|
|
|
(141,390
|
)
|
|
765,403
|
|
|||||
Net income (loss) attributable to Graham Holdings Company
common stockholders
|
271,206
|
|
|
302,044
|
|
|
168,590
|
|
|
(101,286
|
)
|
|
1,292,996
|
|
|||||
Per Share Amounts
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic earnings (loss) per common share attributable to Graham Holdings Company common stockholders
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
$
|
50.55
|
|
|
$
|
54.24
|
|
|
$
|
29.95
|
|
|
$
|
(25.23
|
)
|
|
$
|
115.88
|
|
Net income (loss)
|
50.55
|
|
|
54.24
|
|
|
29.95
|
|
|
(17.87
|
)
|
|
195.81
|
|
|||||
Diluted earnings (loss) per common share attributable to Graham Holdings Company common stockholders
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
$
|
50.20
|
|
|
$
|
53.89
|
|
|
$
|
29.80
|
|
|
$
|
(25.23
|
)
|
|
$
|
115.40
|
|
Net income (loss)
|
50.20
|
|
|
53.89
|
|
|
29.80
|
|
|
(17.87
|
)
|
|
195.03
|
|
|||||
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
5,333
|
|
|
5,516
|
|
|
5,559
|
|
|
5,727
|
|
|
6,470
|
|
|||||
Diluted
|
5,370
|
|
|
5,552
|
|
|
5,589
|
|
|
5,727
|
|
|
6,559
|
|
|||||
Cash dividends per common share
|
$
|
5.32
|
|
|
$
|
5.08
|
|
|
$
|
4.84
|
|
|
$
|
9.10
|
|
|
$
|
10.20
|
|
Graham Holdings Company common stockholders’ equity per common share
|
$
|
550.24
|
|
|
$
|
529.59
|
|
|
$
|
439.88
|
|
|
$
|
429.15
|
|
|
$
|
541.54
|
|
Financial Position
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
|
$
|
720,180
|
|
|
$
|
857,192
|
|
|
$
|
1,052,385
|
|
|
$
|
1,135,573
|
|
|
$
|
639,911
|
|
Total assets
|
4,764,041
|
|
|
4,937,823
|
|
|
4,432,670
|
|
|
4,352,825
|
|
|
5,752,319
|
|
|||||
Long-term debt
|
470,777
|
|
|
486,561
|
|
|
485,719
|
|
|
399,800
|
|
|
399,545
|
|
|||||
Graham Holdings Company common stockholders’ equity
|
2,916,782
|
|
|
2,915,145
|
|
|
2,452,941
|
|
|
2,490,698
|
|
|
3,140,299
|
|
•
|
Intangible asset impairment charge of
$5.8 million
(
$1.08
per share) at the healthcare business
|
•
|
Charges of
$6.3 million
(
$1.12
per share) related to restructuring and non-operating Separation Incentive Program charges at the education division
|
•
|
Goodwill and other long-lived assets impairment charges of
$5.8 million
(
$1.03
per share) in other businesses
|
•
|
Gains, net, of
$2.1 million
(
$0.37
per share) from non-operating foreign currency gains
|
•
|
Net deferred tax benefits of
$177.5 million
(
$31.68
per share) related to the Tax Act
|
•
|
Income tax benefit of
$5.9 million
(
$1.06
per share) related to stock compensation
|
•
|
Charges of
$7.7 million
(
$1.36
per share) related to restructuring at the education division
|
•
|
Non-operating settlement gain of
$10.8 million
(
$1.92
per share) related to a bulk lump sum pension offering
|
•
|
$20.0 million
(
$3.52
per share) net non-operating gain from the sales of land and marketable equity securities
|
•
|
$13.6 million
(
$2.37
per share) non-operating gain arising from the sale of a business and the formation of a joint venture
|
•
|
$24.1 million
(
$4.27
per share) non-operating expense from the write-down of cost method investments and investments in affiliates
|
•
|
Losses, net, of
$25.5 million
(
$4.51
per share) from non-operating foreign currency losses
|
•
|
Net nonrecurring
$8.3 million
(
$1.47
per share) deferred tax benefit related to Kaplan’s international operations
|
•
|
Favorable
$5.6 million
(
$1.00
per share) out of period deferred tax adjustment related to the KHE goodwill impairment from 2015
|
•
|
Goodwill and other long-lived assets impairment charges of
$225.2 million
(
$38.96
per share) at the education division and other business
|
•
|
Charges of
$28.9 million
(
$4.97
per share) related to restructuring and non-operating Special Incentive Program charges at the education division, corporate office and other businesses
|
•
|
$15.3 million
(
$2.64
per share) in expense related to the modification of stock option awards and restricted stock awards
|
•
|
Net non-operating losses of
$15.7 million
(
$2.82
per share) arising from the sales of five businesses and an investment, and on the formation of a joint venture
|
•
|
$13.2 million
(
$2.27
per share) gain on the sale of land
|
•
|
Losses, net, of
$9.7 million
(
$1.67
per share) from non-operating unrealized foreign currency losses
|
•
|
Charges of
$20.2 million
(
$3.05
per share) related to restructuring and non-operating early retirement program expense and related charges at the education division and corporate office
|
•
|
Intangible and other long-lived assets impairment charge of
$11.2 million
(
$1.69
per share) at the education division and other business
|
•
|
Gain from the sale of Classified Ventures of
$249.8 million
(
$37.68
per share)
|
•
|
$58.2 million
(
$8.78
per share) gain from the Classified Ventures’ sale of apartments.com
|
•
|
Gain from the Berkshire exchange transaction of
$266.7 million
(
$40.23
per share)
|
•
|
$81.8 million
(
$12.34
per share) gain on the sale of the corporate headquarters building
|
•
|
Losses, net, of
$7.1 million
(
$1.08
per share) from non-operating unrealized foreign currency losses
|
Name of Subsidiary
|
Jurisdiction of Incorporation or Organization
|
|
% of Voting Equity Owned by Parent
|
|
|
199 Sunbeam Realty, LLC
|
Delaware
|
|
100
|
%
|
|
Cybervista LLC
|
Delaware
|
|
100
|
%
|
|
Forney Corporation
|
Delaware
|
|
100
|
%
|
|
Forney Shanghai Trading Company
|
China (PR)
|
|
100
|
%
|
|
Forney Maquila, LLC
|
Delaware
|
|
100
|
%
|
|
FMMX S. de R.L. de C.V.
|
Mexico
|
|
100
|
%
|
(a)
|
FSM S. de R.L. de C.V
|
Mexico
|
|
100
|
%
|
(b)
|
FRTW Holdings LLC
|
Delaware
|
|
100
|
%
|
|
Hoover Wood Products Holdings, Inc.
|
Delaware
|
|
97.7
|
%
|
|
Hoover Treated Wood Products, Inc.
|
Delaware
|
|
97.7
|
%
|
|
Graham Automotive LLC
|
Delaware
|
|
100
|
%
|
|
Graham-Ourisman Automotive LLC
|
Delaware
|
|
90
|
%
|
|
Graham Healthcare Group, Inc.
|
Delaware
|
|
100
|
%
|
|
Celtic Healthcare, Inc.
|
Nevada
|
|
100
|
%
|
|
Celtic Healthcare of Carlisle, Inc.
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Healthcare of E. MO, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Healthcare of S. IL, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Living Assistance Services, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Homecare, Inc.
|
Pennsylvania
|
|
100
|
%
|
|
Graham Health Services
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Rehabilitation Services, Inc.
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Healthcare of NC PA, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Healthcare of NE PA, Inc.
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Geriatric Care Management, Inc.
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Hospice & Palliative Care Services of Carlisle, Inc.
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Hospice & Palliative Care Services of E. MO, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Hospice & Palliative Care Services of NC PA, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Hospice & Palliative Care Services of S. IL, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Healthcare of NE Ohio, Inc.
|
Ohio
|
|
100
|
%
|
|
Celtic Healthcare of Maryland, Inc.
|
Maryland
|
|
100
|
%
|
|
Celtic Private Care of IL & MO, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Home Health Utilization Management, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Celtic Healthcare Technology Solutions, LLC
|
Pennsylvania
|
|
100
|
%
|
|
Graham Healthcare Capital, LLC
|
Delaware
|
|
100
|
%
|
|
GHC One, LLC
|
Delaware
|
|
100
|
%
|
|
Residential Healthcare Group, Inc.
|
Delaware
|
|
100
|
%
|
|
Hometown Home Health Care Inc.
|
Michigan
|
|
100
|
%
|
|
RHH Holdings Co.
|
Michigan
|
|
100
|
%
|
|
Residential Home Health, LLC
|
Michigan
|
|
100
|
%
|
|
Care Transition Specialists, LLP
|
Michigan
|
|
100
|
%
|
|
Residential Hospice, LLC
|
Michigan
|
|
100
|
%
|
|
RHM-KCINO, LLC
|
Michigan
|
|
100
|
%
|
|
RHH Ventures Illinois, LLC
|
Illinois
|
|
100
|
%
|
|
Graham Media Group, Inc.
|
Delaware
|
|
100
|
%
|
|
Graham Media Group, Florida, Inc.
|
Florida
|
|
100
|
%
|
|
Graham Media Group, Houston, Inc
|
Delaware
|
|
100
|
%
|
|
Graham Media Group, Michigan, Inc.
|
Delaware
|
|
100
|
%
|
|
Graham Media Group, Orlando, Inc.
|
Delaware
|
|
100
|
%
|
|
Graham Media Group, San Antonio, Inc.
|
Delaware
|
|
100
|
%
|
|
Graham Media Group, Virginia, LLC
|
Virginia
|
|
100
|
%
|
|
SocialNewsDesk
|
Florida
|
|
100
|
%
|
|
Group Dekko Holdings Inc.
|
Delaware
|
|
100
|
%
|
|
Group Dekko Inc.
|
Indiana
|
|
100
|
%
|
|
Premier Manufacturing Group, Inc. (d/b/a Electric-Cable Assemblies)
|
Connecticut
|
|
100
|
%
|
|
Dekko Global Enterprise LLC
|
Indiana
|
|
100
|
%
|
|
Furnlite Inc.
|
North Carolina
|
|
100
|
%
|
|
Grupo Dekko Mexico S.A, de C.V,
|
Mexico
|
|
100
|
%
|
(c)
|
Joyce/Dayton Corporation
|
Ohio
|
|
100
|
%
|
|
EDrive Actuators, Inc.
|
Connecticut
|
|
100
|
%
|
|
Lowly Worm Holdings, Inc.
|
Delaware
|
|
100
|
%
|
|
Kaplan, Inc.
|
Delaware
|
|
99.44
|
%
|
|
Dev Bootcamp, Inc.
|
California
|
|
100
|
%
|
|
Graham Holdings Retired Employee Payroll Master, LLC
|
Delaware
|
|
100
|
%
|
|
Kaplan International, LLC
|
Delaware
|
|
100
|
%
|
|
Kaplan (Canada) Ltd.
|
Ontario
|
|
100
|
%
|
|
U.S. CPA ExamPrep, Inc.
|
Ontario
|
|
100
|
%
|
|
Kaplan Educational Services de Mexico, S. de R.L. de C.V.
|
Mexico
|
|
100
|
%
|
(d)
|
Education HR Services Mexico, S. de R.L. de C.V.
|
Mexico
|
|
100
|
%
|
(d)
|
Kaplan Higher Education, LLC
|
Delaware
|
|
100
|
%
|
|
Texas Educational Ventures, LP
|
Delaware
|
|
100
|
%
|
|
Iowa College Acquisition, LLC
|
Delaware
|
|
100
|
%
|
|
DF Institute, LLC
|
Illinois
|
|
100
|
%
|
|
SmartPros, LLC
|
Delaware
|
|
100
|
%
|
|
Loscalzo Institute, LLC
|
New Jersey
|
|
100
|
%
|
|
The College for Financial Planning Institutes Corp.
|
Arizona
|
|
100
|
%
|
|
The College for Financial Planning, Inc.
|
Arizona
|
|
100
|
%
|
|
KV EdTech Partners LLC
|
Delaware
|
|
100
|
%
|
|
Kaplan Mexico Holdings, LLC
|
Delaware
|
|
100
|
%
|
|
Kaplan (India) Private Limited
|
India
|
|
100
|
%
|
(e)
|
Kaplan (PR) Inc.
|
Puerto Rico
|
|
100
|
%
|
|
MG Prep, LLC
|
New York
|
|
100
|
%
|
|
Kaplan K12 Learning Services, LLC
|
Delaware
|
|
100
|
%
|
|
Kaplan Test Prep International, LLC
|
California
|
|
100
|
%
|
|
Kaplan International North America, LLC
|
California
|
|
100
|
%
|
|
Kaplan International Pathways North America, LLC
|
Delaware
|
|
100
|
%
|
|
Kaplan International English (Thailand), Co. Ltd.
|
Thailand
|
|
99.99
|
%
|
(f)
|
Hands On Consulting Limited
|
Hong Kong
|
|
100
|
%
|
|
Hands On Education Consultants Co., Ltd.
|
Thailand
|
|
100
|
%
|
(g)
|
Kaplan U.K. Limited
|
England & Wales
|
|
100
|
%
|
|
Aspect Education Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Japan K.K.
|
Japan
|
|
100
|
%
|
|
BEO Limited
|
Japan
|
|
100
|
%
|
|
BEO KK
|
Japan
|
|
100
|
%
|
|
Aspect (Beijing) Education Information Consulting Co. Ltd.
|
China (PR)
|
|
100
|
%
|
|
Pacific Language Institute, Inc.
|
British Columbia
|
|
100
|
%
|
|
Aspect Education UK Limited
|
England & Wales
|
|
100
|
%
|
|
Aspect Educational Services Limited
|
England & Wales
|
|
100
|
%
|
|
Aspect International Language Academies Limited
|
England & Wales
|
|
100
|
%
|
|
Anglo World Travel SA
|
England & Wales
|
|
100
|
%
|
|
Anglo-World Group Ltd.
|
England & Wales
|
|
100
|
%
|
|
Anglo-World Education Ltd.
|
England & Wales
|
|
100
|
%
|
|
Aspect International Language Schools Limited
|
Ireland
|
|
100
|
%
|
|
Aspect Internationale Sprachschule GmbH
|
Germany
|
|
100
|
%
|
|
Aspect Language Schools Limitada
|
Columbia
|
|
100
|
%
|
|
Aspect Language Schools Limited
|
Switzerland
|
|
100
|
%
|
|
Aspect S.A.R.L. France
|
France
|
|
100
|
%
|
|
Aspect Education (Hong Kong) Limited
|
Hong Kong
|
|
100
|
%
|
|
Kaplan International Colleges, C.A.
|
Venezula
|
|
100
|
%
|
(h)
|
Kaplan International Operations Mexico, S.A. de C.V.
|
Mexico
|
|
100
|
%
|
(i)
|
KI HR Services Mexico, S.A. de C.V.
|
Mexico
|
|
100
|
%
|
(j)
|
West of England Language Services Limited
|
England & Wales
|
|
100
|
%
|
|
The Salisbury School of English Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan International Investments Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Test Prep and Admissions Limited
|
England & Wales
|
|
100
|
%
|
|
Manhattan GMAT Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan International UK Holdings Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Netherlands B.V. (in liquidatie)
|
The Netherlands
|
|
100
|
%
|
|
Kaplan International English (Australia) Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan English Colleges Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan International (Brisbane) Pty Limited
|
Australia
|
|
100
|
%
|
|
ILA Education (NZ) Limited
|
New Zealand
|
|
100
|
%
|
|
Kaplan International (NZ) Limited
|
New Zealand
|
|
100
|
%
|
|
Kaplan International (Perth) Pty Limited
|
Australia
|
|
100
|
%
|
|
Aspect ILA Sydney Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan Australia Holdings Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan Australia Pty Limited
|
Australia
|
|
100
|
%
|
|
Red Marker Pty Ltd
|
Australia
|
|
100
|
%
|
|
Kaplan Carrick Pty Ltd
|
Australia
|
|
100
|
%
|
|
Kaplan International (Melbourne & Adelaide) Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan Higher Education Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan Business School Pty Limited
|
Australia
|
|
100
|
%
|
|
Tribeca Learning Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan Education Pty Limited
|
Australia
|
|
100
|
%
|
|
Kaplan Holdings Limited
|
Hong Kong
|
|
100
|
%
|
|
Kaplan Citic Education Co. Limited
|
China (PR)
|
|
49
|
%
|
|
Kaplan Financial (HK) Limited
|
Hong Kong
|
|
100
|
%
|
|
Kaplan Language Training (HK) Limited
|
Hong Kong
|
|
100
|
%
|
|
Kaplan Institute Limited
|
Hong Kong
|
|
100
|
%
|
|
Shanghai Kaplan Education Investment Consulting Co. Ltd.
|
China (PR)
|
|
100
|
%
|
|
The Financial Training (Shanghai) Co., Ltd.
|
China (PR)
|
|
100
|
%
|
|
Shanghai Kai Bo Education Investment Management Co. Limited
|
China (PR)
|
|
100
|
%
|
(k)
|
Shanghai Kai Chuang Educational Consulting Co. Ltd.
|
China (PR)
|
|
85
|
%
|
|
Shanghai Kai Bo School
|
China (PR)
|
|
100
|
%
|
|
Kaplan Singapore Pte. Ltd.
|
Singapore
|
|
100
|
%
|
|
Kaplan Learning Institute Pte. Ltd
|
Singapore
|
|
100
|
%
|
|
Kaplan Higher Education Institute Pte. Ltd
|
Singapore
|
|
100
|
%
|
|
Kaplan Higher Education (HK) Limited
|
Hong Kong
|
|
100
|
%
|
|
Kaplan Higher Education Academy Pte. Ltd.
|
Singapore
|
|
100
|
%
|
|
Lotus Advertising Pte. Ltd
|
Singapore
|
|
100
|
%
|
|
Kaplan Myanmar Company Limited
|
Myanmar
|
|
99
|
%
|
|
Coxcourt Limited
|
Ireland
|
|
100
|
%
|
|
Accountancy & Business College Holdings Limited
|
Ireland
|
|
100
|
%
|
(l)
|
Accountancy & Business College (Ireland) Limited
|
Ireland
|
|
100
|
%
|
|
Methley Limited
|
Ireland
|
|
100
|
%
|
|
Kitagarth Services Unlimited Company
|
Ireland
|
|
100
|
%
|
|
European Business School (Ireland) Limited
|
Ireland
|
|
100
|
%
|
|
LSB College Limited
|
Ireland
|
|
100
|
%
|
|
The Dublin Business School Limited
|
Ireland
|
|
100
|
%
|
|
DBS Educational Services Malaysia SDN.BHD.
|
Malaysia
|
|
100
|
%
|
|
Kaplan International Holdings Limited
|
England & Wales
|
|
100
|
%
|
|
Eagle Education and Training Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Dubai Limited
|
Dubai
|
|
100
|
%
|
|
Kaplan Higher Education Limited
|
England & Wales
|
|
100
|
%
|
|
Osborne Books Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Financial Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan SQE Limited
|
England & Wales
|
|
100
|
%
|
|
Altior Limited
|
England & Wales
|
|
100
|
%
|
|
Altior Consulting & Training Limited
|
England & Wales
|
|
100
|
%
|
|
Hawksmere Limited
|
England & Wales
|
|
100
|
%
|
|
Holborn College Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan International Colleges U.K. Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Essex Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Qatar Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Colleges Private Limited
|
India
|
|
100
|
%
|
|
Kaplan International Colleges (Private) Limited
|
Pakistan
|
|
100
|
%
|
|
Kaplan Glasgow Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan International Colleges Limited
|
Nigeria
|
|
100
|
%
|
(m)
|
Kaplan Liverpool Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Nottingham Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan NT Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan US Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan International College London Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Brighton Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan UWE Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Bournemouth Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Bath Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Estates Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan York Limited
|
England & Wales
|
|
100
|
%
|
|
University of York International Pathway College LLP
|
England & Wales
|
|
45
|
%
|
|
Kaplan Saudi Arabia Limited
|
Saudi Arabia
|
|
100
|
%
|
|
Kaplan Partner Services HK Limited
|
Hong Kong
|
|
100
|
%
|
|
Kaplan Law School Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Open Learning Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Open Learning (Essex) Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Publishing Limited
|
England & Wales
|
|
100
|
%
|
|
Kaplan Professional Awards Limited
|
England & Wales
|
|
100
|
%
|
|
MPW Topco Limited
|
England & Wales
|
|
100
|
%
|
|
MPW Midco Limited
|
England & Wales
|
|
100
|
%
|
|
MPW Holdco Limited
|
England & Wales
|
|
100
|
%
|
|
Mander Portman Woodward Limited
|
England & Wales
|
|
100
|
%
|
|
Kensington Student Services Limited
|
England & Wales
|
|
100
|
%
|
|
Justin Craig Education Holdings Limited
|
England & Wales
|
|
100
|
%
|
|
Justin Craig Education Limited
|
England & Wales
|
|
100
|
%
|
|
Post NW, LLC
|
New York
|
|
100
|
%
|
|
Social Code LLC
|
Delaware
|
|
100
|
%
|
|
Social Code Holdings, LLC
|
Delaware
|
|
100
|
%
|
|
JKR Ventures, LLC
|
Ohio
|
|
100
|
%
|
|
Marketplace Strategy, LLC
|
Ohio
|
|
100
|
%
|
|
Marketplace Direct, LLC
|
Ohio
|
|
100
|
%
|
|
The Slate Group, LLC
|
Delaware
|
|
100
|
%
|
|
Panoply Media, LLC
|
Delaware
|
|
100
|
%
|
|
Pinna LLC
|
Delaware
|
|
100
|
%
|
|
(a)
|
Forney Corporation owns .03% and Forney Maquila, LLC owns 99.97% of FMMX S. de R.L. de C.V. The combined ownership of Forney Maquila, LLC and Forney Corporation in FMMX S. de R.L. de C.V. is 100%.
|
(b)
|
Forney Maquila, LLC owns .03% and FMMX s. de R.L. de C.V. owns 99.97% of FSM S. de R.L. de C.V. The combined ownership of Forney Maquila, LLC and FMMX S. de R.L. de C.V. in FSM S. de R.L. de C.V. is 100%.
|
(c)
|
Dekko Global Enterprise, LLC owns 99.998% of Type A Common Stock of Grupo Dekko Mexico, S.A. de C.V. and Group Dekko Holdings, Inc. owns .002% of Type A Common Stock of Grupo Dekko Mexico, S.A. de C.V. Dekko Global Enterprise, LLC owns 100% of Type B Common Stock of Grupo Dekko Mexico, S.A. de C.V. The combined ownership by Dekko Global Enterprise, LLC and Group Dekko Holdings, Inc. in Grupo Dekko Mexico, S.A. de C.V. is 100%.
|
(d)
|
Kaplan Mexico Holdings, LLC also owns 1% stock in Kaplan Educational Services de Mexico, S. de R.L. de C.V. and Education HR Services Mexico, S. de R.L. de C.V. The combined ownership of Kaplan, Inc. and Kaplan Mexico Holdings, LLC in Kaplan Educational Services de Mexico, S. de R.L. de C.V. and Education HR Services Mexico, S.de R.L. de C.V. is 100%.
|
(e)
|
Kaplan Colleges Private Limited also owns 4.35% stock in Kaplan (India) Private Limited. The combined ownership of Kaplan Mexico Holdings, LLC and Kaplan Colleges Private Limited in Kaplan (India) Private Limited is 100%.
|
(f)
|
Kaplan International North America, LLC and Kaplan Test Prep International, Inc. each own 1 share or .00334% of Kaplan International English (Thailand), Co. Ltd. The combined ownership of Kaplan International North America, LLC, Kaplan Test Prep International, Inc. and Kaplan, Inc. in Kaplan International English (Thailand), Co. Ltd. is 99.99%.
|
(g)
|
Hands On Consulting Limited owns 49% stock and Kaplan International, Inc. and Kaplan Test Prep International, Inc. each own 0.002% stock of Hands On Education Consultants Co., Ltd. The combined ownership of Kaplan, Inc., Hands On Consulting Limited, Kaplan International, Inc. and Kaplan Test Prep International, Inc. in Hands On Education Consultants Co., Ltd. is 100%.
|
(h)
|
Aspect Educational Services Limited also owns 5% stock in Kaplan International Colleges, C.A. The combined ownership of Aspect Educational Services Limited and Aspect Education Limited in Kaplan International Colleges, C.A. is 100%.
|
(i)
|
Aspect Educational Services Limited also owns .002% equity in Kaplan International Operations Mexico, S.A. de C.V. and KI HR Services Mexico, S.A. de C.V. The combined ownership of Aspect Education Limited and Aspect Educational Services Limited in Kaplan International Operations Mexico, S.A. de C.V. and KI HR Services Mexico, S.A. de C.V. is 100%.
|
(j)
|
Kaplan International Holdings Limited also owns 1 share or .00001% of Kaplan International Colleges Limited. The combined ownership of Kaplan International Holdings Limited and Kaplan International Colleges U.K. Limited in Kaplan International Colleges Limited is 100%.
|
(k)
|
Shanghai Kaplan Education Investment Consulting Co. Ltd also owns 52.5% stock in Shanghai Kai Bo Education Investment Management Co. Limited. The combined ownership of The Financial Training (Shanghai) Co., Ltd and Shanghai Kaplan Education Investment Consulting Co. Ltd in Shanghai Kai Bo Education Investment Management Co. Limited is 100%.
|
(l)
|
Coxcourt Limited also owns 43.11% voting stock in Accountancy & Business College Holdings Limited. The combined stock ownership of Kaplan International UK Holdings Limited and Coxcourt Limited in Accountancy & Business College Holdings Limited is 100%.
|
(m)
|
Kaplan NT Limited, Kaplan Liverpool Limited, Kaplan Glasgow Limited, Kaplan Notingham Limited. - The University of York International Pathway College LLP, Kaplan International College London Limited, Kaplan UWE Limited, Kaplan Bournemouth Limited and Kaplan Brighton Limited each owns 12.5% of Kaplan Partner Services HK Limited. The combined ownership of Kaplan NT Limited, Kaplan Liverpool Limited, Kaplan Glasgow Limited, Kaplan Nottingham Limited, The University of York International Pathway College LLP ,Kaplan International College London Limited, Kaplan UWE Limited, Kaplan Bournemouth Limited and Kaplan Brighton Limited is 100%.
|
/s/ Donald E. Graham
|
|
/s/ Thomas S. Gayner
|
Donald E. Graham, Chairman of the Board and Director
|
|
Thomas S. Gayner, Director
|
/s/ Timothy J. O'Shaughnessy
|
|
/s/ Jack A. Markell
|
Timothy J. O'Shaughnessy, President and Chief Executive Officer (Principal Executive Officer) and Director
|
|
Jack A. Markell, Director
|
/s/ Wallace R. Cooney
|
|
/s/ Anne M. Mulcahy
|
Wallace R. Cooney, Chief Financial Officer (Principal Financial Officer)
|
|
Anne M. Mulcahy, Director
|
/s/ Marcel A. Snyman
|
|
/s/ Larry D. Thompson
|
Marcel A. Snyman, Chief Accounting Officer (Principal Accounting Officer)
|
|
Larry D. Thompson, Director
|
/s/ Lee C. Bollinger
|
|
/s/ G. Richard Wagoner
|
Lee C. Bollinger, Director
|
|
G. Richard Wagoner, Jr., Director
|
/s/ Christopher C. Davis
|
|
/s/ Katharine Weymouth
|
Christopher C. Davis, Director
|
|
Katharine Weymouth, Director
|
|
|
|
/s/ Timothy J. O’Shaughnessy
|
|
/s/ Wallace R. Cooney
|
|
/s/ Timothy J. O’Shaughnessy
|
|
/s/ Wallace R. Cooney
|
|