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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Cambium Learning Grp., Inc. (delisted) | NASDAQ:ABCD | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 14.48 | 8.00 | 199,999.99 | 0 | 01:00:00 |
ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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27-0587428
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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17855 Dallas Parkway, Suite 400, Dallas, Texas
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75287
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(Address of Principal Executive Offices)
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(Zip Code)
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Large accelerated filer
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¨
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Accelerated filer
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¨
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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ý
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Emerging growth company
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¨
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Page
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PART I
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FINANCIAL INFORMATION
|
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Item 1.
|
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||
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 1.
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Item 1A.
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Item 6.
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Three Months Ended June 30,
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Six Months Ended June 30,
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||||||||||||
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2018
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2017
|
|
2018
|
|
2017
|
||||||||
Net revenues
|
$
|
40,996
|
|
|
$
|
40,362
|
|
|
$
|
77,603
|
|
|
$
|
76,332
|
|
Cost of revenues:
|
|
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|
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||||
Cost of revenues
|
7,038
|
|
|
7,215
|
|
|
13,101
|
|
|
13,400
|
|
||||
Amortization expense
|
4,043
|
|
|
4,328
|
|
|
7,947
|
|
|
8,418
|
|
||||
Total cost of revenues
|
11,081
|
|
|
11,543
|
|
|
21,048
|
|
|
21,818
|
|
||||
Research and development expense
|
3,893
|
|
|
3,294
|
|
|
7,619
|
|
|
6,392
|
|
||||
Sales and marketing expense
|
12,717
|
|
|
12,190
|
|
|
25,520
|
|
|
25,100
|
|
||||
General and administrative expense
|
6,135
|
|
|
4,900
|
|
|
11,416
|
|
|
9,783
|
|
||||
Shipping and handling costs
|
186
|
|
|
195
|
|
|
307
|
|
|
313
|
|
||||
Depreciation and amortization expense
|
718
|
|
|
669
|
|
|
1,435
|
|
|
1,350
|
|
||||
Total costs and expenses
|
34,730
|
|
|
32,791
|
|
|
67,345
|
|
|
64,756
|
|
||||
Income before interest and income taxes
|
6,266
|
|
|
7,571
|
|
|
10,258
|
|
|
11,576
|
|
||||
Net interest expense
|
(927
|
)
|
|
(1,336
|
)
|
|
(1,757
|
)
|
|
(2,563
|
)
|
||||
Other income (expense), net
|
118
|
|
|
(109
|
)
|
|
15
|
|
|
(217
|
)
|
||||
Income before income taxes
|
5,457
|
|
|
6,126
|
|
|
8,516
|
|
|
8,796
|
|
||||
Income tax expense
|
(1,022
|
)
|
|
(334
|
)
|
|
(1,474
|
)
|
|
(474
|
)
|
||||
Net income
|
$
|
4,435
|
|
|
$
|
5,792
|
|
|
$
|
7,042
|
|
|
$
|
8,322
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amortization of net pension loss
|
35
|
|
|
23
|
|
|
71
|
|
|
46
|
|
||||
Comprehensive income
|
$
|
4,470
|
|
|
$
|
5,815
|
|
|
$
|
7,113
|
|
|
$
|
8,368
|
|
Net income per common share:
|
|
|
|
|
|
|
|
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||||
Basic
|
$
|
0.09
|
|
|
$
|
0.13
|
|
|
$
|
0.15
|
|
|
$
|
0.18
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Diluted
|
$
|
0.09
|
|
|
$
|
0.12
|
|
|
$
|
0.15
|
|
|
$
|
0.18
|
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Average number of common shares and equivalents outstanding:
|
|
|
|
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|
||||
Basic
|
47,172
|
|
|
46,283
|
|
|
47,036
|
|
|
46,243
|
|
||||
Diluted
|
48,385
|
|
|
47,476
|
|
|
48,250
|
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|
47,460
|
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June 30, 2018
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December 31, 2017
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||||
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(Unaudited)
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|
||||
ASSETS
|
|
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|
|
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Current assets:
|
|
|
|
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|
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Cash and cash equivalents
|
$
|
4,680
|
|
|
$
|
8,493
|
|
Accounts receivable, net
|
13,277
|
|
|
12,937
|
|
||
Inventory
|
1,813
|
|
|
2,382
|
|
||
Restricted assets, current
|
961
|
|
|
961
|
|
||
Other current assets
|
9,731
|
|
|
11,193
|
|
||
Total current assets
|
30,462
|
|
|
35,966
|
|
||
Property, equipment and software at cost
|
62,966
|
|
|
65,250
|
|
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Accumulated depreciation and amortization
|
(42,006
|
)
|
|
(43,164
|
)
|
||
Property, equipment and software, net
|
20,960
|
|
|
22,086
|
|
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Goodwill
|
43,518
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43,518
|
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||
Other intangible assets, net
|
3,108
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|
3,607
|
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Pre-publication costs, net
|
17,986
|
|
|
17,758
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Restricted assets, less current portion
|
839
|
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|
1,293
|
|
||
Deferred tax assets
|
30,020
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|
30,614
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Other assets
|
3,372
|
|
|
3,712
|
|
||
Total assets
|
$
|
150,265
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$
|
158,554
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
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Current liabilities:
|
|
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|
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Accounts payable
|
$
|
2,075
|
|
|
$
|
2,388
|
|
Accrued expenses
|
13,770
|
|
|
12,121
|
|
||
Revolving credit facility
|
10,000
|
|
|
—
|
|
||
Current portion of long-term debt
|
6,651
|
|
|
5,958
|
|
||
Deferred revenue, current
|
61,286
|
|
|
86,913
|
|
||
Total current liabilities
|
93,782
|
|
|
107,380
|
|
||
Long-term liabilities:
|
|
|
|
|
|
||
Long-term debt
|
38,477
|
|
|
41,841
|
|
||
Deferred revenue, less current portion
|
15,232
|
|
|
13,995
|
|
||
Other liabilities
|
9,257
|
|
|
9,630
|
|
||
Total long-term liabilities
|
62,966
|
|
|
65,466
|
|
||
Commitments and contingencies (See Note 13)
|
|
|
|
|
|
||
Stockholders' equity (deficit):
|
|
|
|
|
|
||
Preferred stock ($.001 par value, 15,000 shares authorized, zero shares issued and outstanding at June 30, 2018 and December 31, 2017)
|
—
|
|
|
—
|
|
||
Common stock ($.001 par value, 150,000 shares authorized, 53,789 and 53,333 shares issued, and 47,257 and 46,800 shares outstanding at June 30, 2018 and December 31, 2017, respectively)
|
54
|
|
|
53
|
|
||
Capital surplus
|
290,468
|
|
|
289,022
|
|
||
Accumulated deficit
|
(282,199
|
)
|
|
(288,490
|
)
|
||
Treasury stock at cost (6,532 shares at June 30, 2018 and December 31, 2017)
|
(12,784
|
)
|
|
(12,784
|
)
|
||
Accumulated other comprehensive loss:
|
|
|
|
|
|
||
Pension and postretirement plans
|
(2,022
|
)
|
|
(2,093
|
)
|
||
Accumulated other comprehensive loss
|
(2,022
|
)
|
|
(2,093
|
)
|
||
Total stockholders' equity (deficit)
|
(6,483
|
)
|
|
(14,292
|
)
|
||
Total liabilities and stockholders' equity (deficit)
|
$
|
150,265
|
|
|
$
|
158,554
|
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2018
|
|
2017
|
||||
Operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
7,042
|
|
|
$
|
8,322
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization expense
|
|
9,382
|
|
|
9,768
|
|
||
Deferred income taxes
|
|
795
|
|
|
—
|
|
||
Amortization of note discount and deferred financing costs
|
|
271
|
|
|
408
|
|
||
Stock-based compensation and expense
|
|
479
|
|
|
424
|
|
||
Other
|
|
3
|
|
|
13
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||
Accounts receivable, net
|
|
(409
|
)
|
|
994
|
|
||
Inventory
|
|
578
|
|
|
29
|
|
||
Other current assets
|
|
908
|
|
|
2,540
|
|
||
Other assets
|
|
251
|
|
|
(10
|
)
|
||
Restricted assets
|
|
454
|
|
|
540
|
|
||
Accounts payable
|
|
(313
|
)
|
|
280
|
|
||
Accrued expenses
|
|
1,735
|
|
|
226
|
|
||
Deferred revenue
|
|
(24,814
|
)
|
|
(27,419
|
)
|
||
Other long-term liabilities
|
|
(302
|
)
|
|
(405
|
)
|
||
Net cash used in operating activities
|
|
(3,940
|
)
|
|
(4,290
|
)
|
||
Investing activities:
|
|
|
|
|
|
|
||
Expenditures for property, equipment, software and pre-publication costs
|
|
(7,988
|
)
|
|
(8,816
|
)
|
||
Net cash used in investing activities
|
|
(7,988
|
)
|
|
(8,816
|
)
|
||
Financing activities:
|
|
|
|
|
|
|
||
Repayment of debt
|
|
(2,853
|
)
|
|
(3,500
|
)
|
||
Borrowings under revolving credit facility
|
|
10,000
|
|
|
16,000
|
|
||
Proceeds from exercise of stock options
|
|
968
|
|
|
322
|
|
||
Net cash provided by financing activities
|
|
8,115
|
|
|
12,822
|
|
||
Change in cash and cash equivalents
|
|
(3,813
|
)
|
|
(284
|
)
|
||
Cash and cash equivalents, beginning of period
|
|
8,493
|
|
|
4,930
|
|
||
Cash and cash equivalents, end of period
|
|
$
|
4,680
|
|
|
$
|
4,646
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Cost of revenues
|
$
|
10
|
|
|
$
|
14
|
|
|
$
|
23
|
|
|
$
|
27
|
|
Research and development expense
|
51
|
|
|
40
|
|
|
100
|
|
|
75
|
|
||||
Sales and marketing expense
|
72
|
|
|
51
|
|
|
133
|
|
|
97
|
|
||||
General and administrative expense
|
119
|
|
|
119
|
|
|
223
|
|
|
225
|
|
||||
Total
|
$
|
252
|
|
|
$
|
224
|
|
|
$
|
479
|
|
|
$
|
424
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
(in thousands, except per share data)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income
|
|
$
|
4,435
|
|
|
$
|
5,792
|
|
|
$
|
7,042
|
|
|
$
|
8,322
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted-average common shares used in computing basic net income per share
|
|
47,172
|
|
|
46,283
|
|
|
47,036
|
|
|
46,243
|
|
||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Add weighted-average effect of dilutive securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Stock options and restricted stock awards
|
|
1,213
|
|
|
1,193
|
|
|
1,214
|
|
|
1,217
|
|
||||
Weighted-average common shares used in computing diluted net income per share
|
|
48,385
|
|
|
47,476
|
|
|
48,250
|
|
|
47,460
|
|
||||
Net income per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
0.09
|
|
|
$
|
0.13
|
|
|
$
|
0.15
|
|
|
$
|
0.18
|
|
Diluted
|
|
$
|
0.09
|
|
|
$
|
0.12
|
|
|
$
|
0.15
|
|
|
$
|
0.18
|
|
(in thousands)
|
As Reported December 31, 2017
|
|
Adjustments due to ASC 606
|
|
As Adjusted January 1, 2018
|
||||||
Accounts receivable
|
$
|
12,937
|
|
|
$
|
(69
|
)
|
|
$
|
12,868
|
|
Inventory
|
2,382
|
|
|
10
|
|
|
2,392
|
|
|||
Other current assets
|
11,193
|
|
|
(554
|
)
|
|
10,639
|
|
|||
Deferred tax assets
|
30,614
|
|
|
201
|
|
|
30,815
|
|
|||
|
|
|
|
|
|
||||||
Accrued expenses
|
12,121
|
|
|
(85
|
)
|
|
12,036
|
|
|||
Deferred revenue
|
86,913
|
|
|
424
|
|
|
87,337
|
|
|||
Accumulated deficit
|
(288,490
|
)
|
|
(751
|
)
|
|
(289,241
|
)
|
|
Three Months Ended June 30, 2018
|
||||||||||||||
(in thousands)
|
Learning A-Z
|
|
ExploreLearning
|
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
United States
|
$
|
17,166
|
|
|
$
|
7,324
|
|
|
$
|
12,609
|
|
|
$
|
37,099
|
|
International
|
3,269
|
|
|
408
|
|
|
220
|
|
|
3,897
|
|
||||
Total Revenue
|
$
|
20,435
|
|
|
$
|
7,732
|
|
|
$
|
12,829
|
|
|
$
|
40,996
|
|
|
Three Months Ended June 30, 2017
|
||||||||||||||
(in thousands)
|
Learning A-Z
|
|
ExploreLearning
|
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
United States
|
$
|
15,979
|
|
|
$
|
6,355
|
|
|
$
|
14,560
|
|
|
$
|
36,894
|
|
International
|
2,671
|
|
|
380
|
|
|
417
|
|
|
3,468
|
|
||||
Total Revenue
|
$
|
18,650
|
|
|
$
|
6,735
|
|
|
$
|
14,977
|
|
|
$
|
40,362
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||
(in thousands)
|
Learning
A-Z |
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
United States
|
$
|
33,359
|
|
|
$
|
14,443
|
|
|
$
|
22,174
|
|
|
$
|
69,976
|
|
International
|
6,212
|
|
|
793
|
|
|
622
|
|
|
7,627
|
|
||||
Total Revenue
|
$
|
39,571
|
|
|
$
|
15,236
|
|
|
$
|
22,796
|
|
|
$
|
77,603
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||
(in thousands)
|
Learning
A-Z |
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
United States
|
$
|
31,557
|
|
|
$
|
12,774
|
|
|
$
|
24,977
|
|
|
$
|
69,308
|
|
International
|
5,278
|
|
|
739
|
|
|
1,007
|
|
|
7,024
|
|
||||
Total Revenue
|
$
|
36,835
|
|
|
$
|
13,513
|
|
|
$
|
25,984
|
|
|
$
|
76,332
|
|
•
|
Level 1 — Quoted prices for identical instruments in active markets.
|
•
|
Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which significant value drivers are observable.
|
•
|
Level 3 — Valuations derived from valuation techniques in which significant value drivers are unobservable.
|
(in thousands)
|
|
|
|
Fair Value at Reporting Date Using
|
||||||||||||
Description
|
|
June 30, 2018
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Restricted Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money Market
|
|
$
|
1,800
|
|
|
$
|
1,800
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collateral Investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money Market
|
|
910
|
|
|
910
|
|
|
—
|
|
|
—
|
|
||||
Certificates of Deposit
|
|
226
|
|
|
226
|
|
|
—
|
|
|
—
|
|
(in thousands)
|
|
|
|
Fair Value at Reporting Date Using
|
||||||||||||
Description
|
|
December 31, 2017
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Restricted Assets:
|
|
|
|
|
|
|
|
|
||||||||
Money Market
|
|
$
|
2,254
|
|
|
$
|
2,254
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Collateral Investments:
|
|
|
|
|
|
|
|
|
|
|||||||
Money Market
|
|
908
|
|
|
908
|
|
|
—
|
|
|
—
|
|
||||
Certificates of Deposit
|
|
226
|
|
|
226
|
|
|
—
|
|
|
—
|
|
(in thousands)
|
|
Total Gains (Losses) for the Six Months Ended June 30,
|
||||||
Description
|
|
2018
|
|
2017
|
||||
Restricted Assets:
|
|
|
|
|
||||
Money Market
|
|
$
|
—
|
|
|
$
|
—
|
|
Collateral Investments:
|
|
|
|
|
||||
Money Market
|
|
—
|
|
|
—
|
|
||
Certificates of Deposit
|
|
—
|
|
|
—
|
|
(in thousands)
|
|
|
|
Fair Value at Reporting Date Using
|
||||||||||||
Description
|
|
June 30, 2018
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Goodwill
|
|
$
|
43,518
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
43,518
|
|
Property, equipment and software, net
|
|
20,960
|
|
|
—
|
|
|
—
|
|
|
20,960
|
|
||||
Pre-publication costs, net
|
|
17,986
|
|
|
—
|
|
|
—
|
|
|
17,986
|
|
||||
Other intangible assets, net
|
|
3,108
|
|
|
—
|
|
|
—
|
|
|
3,108
|
|
(in thousands)
|
|
|
|
Fair Value at Reporting Date Using
|
||||||||||||
Description
|
|
December 31, 2017
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Goodwill
|
|
$
|
43,518
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
43,518
|
|
Property, equipment and software, net
|
|
22,086
|
|
|
—
|
|
|
—
|
|
|
22,086
|
|
||||
Pre-publication costs, net
|
|
17,758
|
|
|
—
|
|
|
—
|
|
|
17,758
|
|
||||
Other intangible assets, net
|
|
3,607
|
|
|
—
|
|
|
—
|
|
|
3,607
|
|
(in thousands)
|
|
Total Gains (Losses) for the Six Months Ended June 30,
|
||||||
Description
|
|
2018
|
|
2017
|
||||
Goodwill
|
|
$
|
—
|
|
|
$
|
—
|
|
Property, equipment and software, net
|
|
—
|
|
|
—
|
|
||
Pre-publication costs, net
|
|
—
|
|
|
—
|
|
||
Other intangible assets, net
|
|
—
|
|
|
—
|
|
(in thousands)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Deferred costs
|
|
$
|
6,426
|
|
|
$
|
9,246
|
|
Prepaid expenses
|
|
2,695
|
|
|
1,762
|
|
||
Other
|
|
610
|
|
|
185
|
|
||
Other current assets
|
|
$
|
9,731
|
|
|
$
|
11,193
|
|
(in thousands)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Deferred costs, less current portion
|
|
$
|
1,422
|
|
|
$
|
1,745
|
|
Collateral investments
|
|
1,136
|
|
|
1,134
|
|
||
Deferred financing costs – revolving credit facility
|
|
441
|
|
|
530
|
|
||
Other
|
|
373
|
|
|
303
|
|
||
Other assets
|
|
$
|
3,372
|
|
|
$
|
3,712
|
|
(in thousands)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Salaries, bonuses and benefits
|
|
$
|
8,869
|
|
|
$
|
8,550
|
|
Pension and post-retirement benefit plans
|
|
950
|
|
|
950
|
|
||
Accrued royalties
|
|
901
|
|
|
830
|
|
||
Other
|
|
3,050
|
|
|
1,791
|
|
||
Accrued expenses
|
|
$
|
13,770
|
|
|
$
|
12,121
|
|
(in thousands)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Pension and post-retirement benefit plans, long-term portion
|
|
$
|
7,960
|
|
|
$
|
8,285
|
|
Deferred rent
|
|
535
|
|
|
587
|
|
||
Long-term income tax payable
|
|
481
|
|
|
470
|
|
||
Long-term deferred compensation
|
|
281
|
|
|
288
|
|
||
Other liabilities
|
|
$
|
9,257
|
|
|
$
|
9,630
|
|
(in thousands)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Senior secured credit facility term loans maturing December 10, 2020
|
|
$
|
45,647
|
|
|
$
|
48,500
|
|
Less: Unamortized discount
|
|
(281
|
)
|
|
(380
|
)
|
||
Less: Unamortized deferred financing costs
|
|
(238
|
)
|
|
(321
|
)
|
||
Term loans, net of discount and deferred costs
|
|
45,128
|
|
|
47,799
|
|
||
Less: Current portion of long-term debt
|
|
6,651
|
|
|
5,958
|
|
||
Long-term debt
|
|
$
|
38,477
|
|
|
$
|
41,841
|
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||
(in thousands)
|
Learning
A-Z |
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net revenues
|
$
|
20,435
|
|
|
$
|
7,732
|
|
|
$
|
12,829
|
|
|
$
|
—
|
|
|
$
|
40,996
|
|
Cost of revenues
|
1,263
|
|
|
999
|
|
|
4,776
|
|
|
—
|
|
|
7,038
|
|
|||||
Amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
4,043
|
|
|
4,043
|
|
|||||
Total cost of revenues
|
1,263
|
|
|
999
|
|
|
4,776
|
|
|
4,043
|
|
|
11,081
|
|
|||||
Other operating expenses
|
9,284
|
|
|
3,957
|
|
|
5,116
|
|
|
4,574
|
|
|
22,931
|
|
|||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
718
|
|
|
718
|
|
|||||
Total costs and expenses
|
10,547
|
|
|
4,956
|
|
|
9,892
|
|
|
9,335
|
|
|
34,730
|
|
|||||
Income before interest and income taxes
|
9,888
|
|
|
2,776
|
|
|
2,937
|
|
|
(9,335
|
)
|
|
6,266
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(927
|
)
|
|
(927
|
)
|
|||||
Other income (expense), net
|
—
|
|
|
—
|
|
|
—
|
|
|
118
|
|
|
118
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,022
|
)
|
|
(1,022
|
)
|
|||||
Segment net income
|
$
|
9,888
|
|
|
$
|
2,776
|
|
|
$
|
2,937
|
|
|
$
|
(11,166
|
)
|
|
$
|
4,435
|
|
Expenditures for property, equipment,
software and pre-publication costs |
$
|
2,324
|
|
|
$
|
1,082
|
|
|
$
|
557
|
|
|
$
|
17
|
|
|
$
|
3,980
|
|
|
Three Months Ended June 30, 2017
|
||||||||||||||||||
(in thousands)
|
Learning
A-Z |
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net revenues
|
$
|
18,650
|
|
|
$
|
6,735
|
|
|
$
|
14,977
|
|
|
$
|
—
|
|
|
$
|
40,362
|
|
Cost of revenues
|
942
|
|
|
808
|
|
|
5,465
|
|
|
—
|
|
|
7,215
|
|
|||||
Amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
4,328
|
|
|
4,328
|
|
|||||
Total cost of revenues
|
942
|
|
|
808
|
|
|
5,465
|
|
|
4,328
|
|
|
11,543
|
|
|||||
Other operating expenses
|
8,020
|
|
|
3,113
|
|
|
6,104
|
|
|
3,342
|
|
|
20,579
|
|
|||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
669
|
|
|
669
|
|
|||||
Total costs and expenses
|
8,962
|
|
|
3,921
|
|
|
11,569
|
|
|
8,339
|
|
|
32,791
|
|
|||||
Income before interest and income taxes
|
9,688
|
|
|
2,814
|
|
|
3,408
|
|
|
(8,339
|
)
|
|
7,571
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,336
|
)
|
|
(1,336
|
)
|
|||||
Other income (expense), net
|
—
|
|
|
—
|
|
|
—
|
|
|
(109
|
)
|
|
(109
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(334
|
)
|
|
(334
|
)
|
|||||
Segment net income
|
$
|
9,688
|
|
|
$
|
2,814
|
|
|
$
|
3,408
|
|
|
$
|
(10,118
|
)
|
|
$
|
5,792
|
|
Expenditures for property, equipment,
software and pre-publication costs |
$
|
2,089
|
|
|
$
|
798
|
|
|
$
|
1,361
|
|
|
$
|
36
|
|
|
$
|
4,284
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||
(in thousands)
|
Learning
A-Z |
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net revenues
|
$
|
39,571
|
|
|
$
|
15,236
|
|
|
$
|
22,796
|
|
|
$
|
—
|
|
|
$
|
77,603
|
|
Cost of revenues
|
2,295
|
|
|
2,022
|
|
|
8,784
|
|
|
—
|
|
|
13,101
|
|
|||||
Amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
7,947
|
|
|
7,947
|
|
|||||
Total cost of revenues
|
2,295
|
|
|
2,022
|
|
|
8,784
|
|
|
7,947
|
|
|
21,048
|
|
|||||
Other operating expenses
|
18,499
|
|
|
7,867
|
|
|
10,222
|
|
|
8,274
|
|
|
44,862
|
|
|||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
1,435
|
|
|
1,435
|
|
|||||
Total costs and expenses
|
20,794
|
|
|
9,889
|
|
|
19,006
|
|
|
17,656
|
|
|
67,345
|
|
|||||
Income before interest and income taxes
|
18,777
|
|
|
5,347
|
|
|
3,790
|
|
|
(17,656
|
)
|
|
10,258
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,757
|
)
|
|
(1,757
|
)
|
|||||
Other income (expense), net
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
15
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,474
|
)
|
|
(1,474
|
)
|
|||||
Segment net income
|
$
|
18,777
|
|
|
$
|
5,347
|
|
|
$
|
3,790
|
|
|
$
|
(20,872
|
)
|
|
$
|
7,042
|
|
Expenditures for property, equipment,
software and pre-publication costs |
$
|
4,450
|
|
|
$
|
2,197
|
|
|
$
|
1,310
|
|
|
$
|
31
|
|
|
$
|
7,988
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||||||
(in thousands)
|
Learning
A-Z |
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net revenues
|
$
|
36,835
|
|
|
$
|
13,513
|
|
|
$
|
25,984
|
|
|
$
|
—
|
|
|
$
|
76,332
|
|
Cost of revenues
|
1,813
|
|
|
1,679
|
|
|
9,908
|
|
|
—
|
|
|
13,400
|
|
|||||
Amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
8,418
|
|
|
8,418
|
|
|||||
Total cost of revenues
|
1,813
|
|
|
1,679
|
|
|
9,908
|
|
|
8,418
|
|
|
21,818
|
|
|||||
Other operating expenses
|
16,466
|
|
|
6,344
|
|
|
12,033
|
|
|
6,745
|
|
|
41,588
|
|
|||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
1,350
|
|
|
1,350
|
|
|||||
Total costs and expenses
|
18,279
|
|
|
8,023
|
|
|
21,941
|
|
|
16,513
|
|
|
64,756
|
|
|||||
Income before interest and income taxes
|
18,556
|
|
|
5,490
|
|
|
4,043
|
|
|
(16,513
|
)
|
|
11,576
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,563
|
)
|
|
(2,563
|
)
|
|||||
Other income (expense), net
|
—
|
|
|
—
|
|
|
—
|
|
|
(217
|
)
|
|
(217
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(474
|
)
|
|
(474
|
)
|
|||||
Segment net income
|
$
|
18,556
|
|
|
$
|
5,490
|
|
|
$
|
4,043
|
|
|
$
|
(19,767
|
)
|
|
$
|
8,322
|
|
Expenditures for property, equipment,
software and pre-publication costs |
$
|
4,191
|
|
|
$
|
1,648
|
|
|
$
|
2,924
|
|
|
$
|
53
|
|
|
$
|
8,816
|
|
•
|
Learning A-Z:
$24.3 million
, increased
12.6%
in the first
six
months of the year compared to the prior year period, continuing its historical growth performance.
|
•
|
ExploreLearning:
$10.0 million
, increased
13.8%
in the first
six
months of the year compared to the prior year period with continued strong momentum for the
Reflex
math product and the
Gizmos
math and science simulations.
|
•
|
Voyager Sopris Learning:
$18.7 million
, increased
1.0%
in the first
six
months of the year compared to the prior year period. The Bookings increase came primarily from the segment's technology-enabled solutions, which increased 9% compared to the prior year.
|
|
Three Months Ended
|
|
Year-Over-Year Change
|
|||||||||||||||||
|
June 30, 2018
|
|
June 30, 2017
|
|
Favorable/(Unfavorable)
|
|||||||||||||||
(in thousands)
|
Amount
|
|
% of Net
Revenues |
|
Amount
|
|
% of Net
Revenues |
|
$
|
|
%
|
|||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Learning A-Z
|
$
|
20,435
|
|
|
49.8
|
%
|
|
$
|
18,650
|
|
|
46.2
|
%
|
|
$
|
1,785
|
|
|
9.6
|
%
|
ExploreLearning
|
7,732
|
|
|
18.9
|
%
|
|
6,735
|
|
|
16.7
|
%
|
|
997
|
|
|
14.8
|
%
|
|||
Voyager Sopris Learning
|
12,829
|
|
|
31.3
|
%
|
|
14,977
|
|
|
37.1
|
%
|
|
(2,148
|
)
|
|
(14.3
|
)%
|
|||
Total net revenues
|
40,996
|
|
|
100.0
|
%
|
|
40,362
|
|
|
100.0
|
%
|
|
634
|
|
|
1.6
|
%
|
|||
Cost of revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Learning A-Z
|
1,263
|
|
|
3.1
|
%
|
|
942
|
|
|
2.3
|
%
|
|
(321
|
)
|
|
(34.1
|
)%
|
|||
ExploreLearning
|
999
|
|
|
2.4
|
%
|
|
808
|
|
|
2.0
|
%
|
|
(191
|
)
|
|
(23.6
|
)%
|
|||
Voyager Sopris Learning
|
4,776
|
|
|
11.6
|
%
|
|
5,465
|
|
|
13.5
|
%
|
|
689
|
|
|
12.6
|
%
|
|||
Amortization expense
|
4,043
|
|
|
9.9
|
%
|
|
4,328
|
|
|
10.7
|
%
|
|
285
|
|
|
6.6
|
%
|
|||
Total cost of revenues
|
11,081
|
|
|
27.0
|
%
|
|
11,543
|
|
|
28.6
|
%
|
|
462
|
|
|
4.0
|
%
|
|||
Research and development expense
|
3,893
|
|
|
9.5
|
%
|
|
3,294
|
|
|
8.2
|
%
|
|
(599
|
)
|
|
(18.2
|
)%
|
|||
Sales and marketing expense
|
12,717
|
|
|
31.0
|
%
|
|
12,190
|
|
|
30.2
|
%
|
|
(527
|
)
|
|
(4.3
|
)%
|
|||
General and administrative expense
|
6,135
|
|
|
15.0
|
%
|
|
4,900
|
|
|
12.1
|
%
|
|
(1,235
|
)
|
|
(25.2
|
)%
|
|||
Shipping and handling costs
|
186
|
|
|
0.5
|
%
|
|
195
|
|
|
0.5
|
%
|
|
9
|
|
|
4.6
|
%
|
|||
Depreciation and amortization expense
|
718
|
|
|
1.8
|
%
|
|
669
|
|
|
1.7
|
%
|
|
(49
|
)
|
|
(7.3
|
)%
|
|||
Income before interest and income taxes
|
6,266
|
|
|
15.3
|
%
|
|
7,571
|
|
|
18.8
|
%
|
|
(1,305
|
)
|
|
(17.2
|
)%
|
|||
Net interest expense
|
(927
|
)
|
|
(2.3
|
)%
|
|
(1,336
|
)
|
|
(3.3
|
)%
|
|
409
|
|
|
30.6
|
%
|
|||
Other income (expense), net
|
118
|
|
|
0.3
|
%
|
|
(109
|
)
|
|
(0.3
|
)%
|
|
227
|
|
|
208.3
|
%
|
|||
Income tax expense
|
(1,022
|
)
|
|
(2.5
|
)%
|
|
(334
|
)
|
|
(0.8
|
)%
|
|
(688
|
)
|
|
(206.0
|
)%
|
|||
Net income
|
$
|
4,435
|
|
|
10.8
|
%
|
|
$
|
5,792
|
|
|
14.4
|
%
|
|
$
|
(1,357
|
)
|
|
(23.4
|
)%
|
•
|
Learning A-Z's net revenues were
$20.4 million
, increasing
$1.8 million
, or
9.6%
, in the quarter ended
June 30, 2018
compared to the same period of
2017
. The year-over-year increase in revenue is driven by Learning A-Z's ongoing strong Bookings trend.
|
•
|
ExploreLearning's net revenues were
$7.7 million
, increasing
$1.0 million
, or
14.8%
, during the quarter ended
June 30, 2018
compared to the same period of
2017
. The increase in net revenues is due to ExploreLearning's continued strong Bookings performance.
|
•
|
Voyager Sopris Learning's net revenues were
$12.8 million
, decreasing
$2.1 million
, or
14.3%
, during the quarter ended
June 30, 2018
compared to the same period of
2017
. GAAP net revenues include a significant amount of revenue recognition generated from prior period Bookings.
|
•
|
Learning A-Z's cost of revenues increased by
$0.3 million
, to
$1.3 million
due to the higher volume of subscriptions as well as increased customer support initiatives.
|
•
|
ExploreLearning's cost of revenues increased by
$0.2 million
to
$1.0 million
in the quarter ended
June 30, 2018
compared to the same period of
2017
. The increased costs were related to implementation and training due to the segment's increased level of customer support.
|
•
|
Voyager Sopris Learning's cost of revenues decreased
$0.7 million
or
12.6%
, to
$4.8 million
in the quarter ended
June 30, 2018
compared to
$5.5 million
in the
second
quarter of
2017
. The decrease in cost of revenues was due to the year-over-year decline in revenue, as well as cost savings from restructuring in late 2017.
|
|
Six Months Ended
|
|
Year Over Year Change
|
|||||||||||||||||
|
June 30, 2018
|
|
June 30, 2017
|
|
Favorable/(Unfavorable)
|
|||||||||||||||
(in thousands)
|
Amount
|
|
% of Net Revenues
|
|
Amount
|
|
% of Net Revenues
|
|
$
|
|
%
|
|||||||||
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Learning A-Z
|
$
|
39,571
|
|
|
51.0
|
%
|
|
$
|
36,835
|
|
|
48.3
|
%
|
|
$
|
2,736
|
|
|
7.4
|
%
|
ExploreLearning
|
15,236
|
|
|
19.6
|
%
|
|
13,513
|
|
|
17.7
|
%
|
|
1,723
|
|
|
12.8
|
%
|
|||
Voyager Sopris Learning
|
22,796
|
|
|
29.4
|
%
|
|
25,984
|
|
|
34.0
|
%
|
|
(3,188
|
)
|
|
(12.3
|
)%
|
|||
Total net revenues
|
77,603
|
|
|
100.0
|
%
|
|
76,332
|
|
|
100.0
|
%
|
|
1,271
|
|
|
1.7
|
%
|
|||
Cost of revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Learning A-Z
|
2,295
|
|
|
3.0
|
%
|
|
1,813
|
|
|
2.4
|
%
|
|
(482
|
)
|
|
(26.6
|
)%
|
|||
ExploreLearning
|
2,022
|
|
|
2.6
|
%
|
|
1,679
|
|
|
2.2
|
%
|
|
(343
|
)
|
|
(20.4
|
)%
|
|||
Voyager Sopris Learning
|
8,784
|
|
|
11.3
|
%
|
|
9,908
|
|
|
13.0
|
%
|
|
1,124
|
|
|
11.3
|
%
|
|||
Amortization expense
|
7,947
|
|
|
10.2
|
%
|
|
8,418
|
|
|
11.0
|
%
|
|
471
|
|
|
5.6
|
%
|
|||
Total cost of revenues
|
21,048
|
|
|
27.1
|
%
|
|
21,818
|
|
|
28.6
|
%
|
|
770
|
|
|
3.5
|
%
|
|||
Research and development expense
|
7,619
|
|
|
9.8
|
%
|
|
6,392
|
|
|
8.4
|
%
|
|
(1,227
|
)
|
|
(19.2
|
)%
|
|||
Sales and marketing expense
|
25,520
|
|
|
32.9
|
%
|
|
25,100
|
|
|
32.9
|
%
|
|
(420
|
)
|
|
(1.7
|
)%
|
|||
General and administrative expense
|
11,416
|
|
|
14.7
|
%
|
|
9,783
|
|
|
12.8
|
%
|
|
(1,633
|
)
|
|
(16.7
|
)%
|
|||
Shipping and handling costs
|
307
|
|
|
0.4
|
%
|
|
313
|
|
|
0.4
|
%
|
|
6
|
|
|
1.9
|
%
|
|||
Depreciation and amortization expense
|
1,435
|
|
|
1.8
|
%
|
|
1,350
|
|
|
1.8
|
%
|
|
(85
|
)
|
|
(6.3
|
)%
|
|||
Income before interest and income taxes
|
10,258
|
|
|
13.2
|
%
|
|
11,576
|
|
|
15.2
|
%
|
|
(1,318
|
)
|
|
(11.4
|
)%
|
|||
Net interest expense
|
(1,757
|
)
|
|
(2.3
|
)%
|
|
(2,563
|
)
|
|
(3.4
|
)%
|
|
806
|
|
|
31.4
|
%
|
|||
Other income (expense), net
|
15
|
|
|
—
|
%
|
|
(217
|
)
|
|
(0.3
|
)%
|
|
232
|
|
|
106.9
|
%
|
|||
Income tax expense
|
(1,474
|
)
|
|
(1.9
|
)%
|
|
(474
|
)
|
|
(0.6
|
)%
|
|
(1,000
|
)
|
|
(211.0
|
)%
|
|||
Net income
|
$
|
7,042
|
|
|
9.1
|
%
|
|
$
|
8,322
|
|
|
10.9
|
%
|
|
$
|
(1,280
|
)
|
|
(15.4
|
)%
|
•
|
Learning A-Z's net revenues were
$39.6 million
, increasing
$2.7 million
, or
7.4%
, in the
six
months ended
June 30, 2018
compared to the same period of
2017
. The year-over-year increase in revenue is driven by Learning A-Z's ongoing strong Bookings trend.
|
•
|
ExploreLearning's net revenues were
$15.2 million
, increasing
$1.7 million
, or
12.8%
, during the
six
months ended
June 30, 2018
compared to the same period of
2017
. The increase in net revenues is due to ExploreLearning's continued strong Bookings performance.
|
•
|
Voyager Sopris Learning's net revenues were
$22.8 million
, decreasing
$3.2 million
, or
12.3%
, during the
six
months ended
June 30, 2018
compared to the same period of
2017
. Although Bookings increased slightly in the
six
months ended
June 30, 2018
, GAAP net revenues include a significant amount of revenue recognition generated from prior period Bookings.
|
•
|
Learning A-Z's cost of revenues increased by
$0.5 million
, to
$2.3 million
, in the
six
months ended
June 30, 2018
compared to
$1.8 million
in the same period of
2017
due to higher volume of subscriptions as well as increased customer support initiatives.
|
•
|
ExploreLearning's cost of revenues increased by
$0.3 million
to
$2.0 million
in the
six
months ended
June 30, 2018
compared to the same period of
2017
. The increased costs were related to implementation and training due to the segment's increased level of customer support.
|
•
|
Voyager Sopris Learning's cost of revenues decreased
$1.1 million
or
11.3%
, to
$8.8 million
in the
six
months ended
June 30, 2018
compared to
$9.9 million
in the first half of
2017
. The decrease in cost of revenues was due to the year-over-year decline in revenue, as well as cost savings from restructuring in late 2017.
|
|
|
Six Months Ended June 30,
|
||||||
(in thousands)
|
|
2018
|
|
2017
|
||||
Operating activities
|
|
$
|
(3,940
|
)
|
|
$
|
(4,290
|
)
|
Investing activities
|
|
(7,988
|
)
|
|
(8,816
|
)
|
||
Financing activities
|
|
8,115
|
|
|
12,822
|
|
•
|
EBITDA
is earnings from operations before interest, income taxes, and depreciation and amortization.
|
•
|
Adjusted EBITDA
is EBITDA excluding non-operational and non-cash items. Examples of items excluded from Adjusted EBITDA include stock-based compensation, merger, acquisition and disposition activities, certain impairment charges, and restructuring charges.
|
•
|
Cash Income
reduces Adjusted EBITDA for capital expenditures and removes the timing differences for recognition of deferred revenues and related deferred costs.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Bookings
|
$
|
33,116
|
|
|
$
|
29,741
|
|
|
$
|
52,969
|
|
|
$
|
48,853
|
|
Change in deferred revenues
|
7,900
|
|
|
10,576
|
|
|
24,814
|
|
|
27,419
|
|
||||
Other
(a)
|
(20
|
)
|
|
45
|
|
|
(180
|
)
|
|
60
|
|
||||
Net revenues
|
$
|
40,996
|
|
|
$
|
40,362
|
|
|
$
|
77,603
|
|
|
$
|
76,332
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
(in thousands)
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income
|
$
|
4,435
|
|
|
$
|
5,792
|
|
|
$
|
7,042
|
|
|
$
|
8,322
|
|
Reconciling items between net income and EBITDA:
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization expense
|
4,761
|
|
|
4,997
|
|
|
9,382
|
|
|
9,768
|
|
||||
Net interest expense
|
927
|
|
|
1,336
|
|
|
1,757
|
|
|
2,563
|
|
||||
Income tax expense
|
1,022
|
|
|
334
|
|
|
1,474
|
|
|
474
|
|
||||
Income from operations before interest, income taxes, and depreciation and amortization (EBITDA)
|
11,145
|
|
|
12,459
|
|
|
19,655
|
|
|
21,127
|
|
||||
Non-operational or non-cash costs included in EBITDA but excluded from Adjusted EBITDA:
|
|
|
|
|
|
|
|
||||||||
Income from sale of excess state tax credits
(b)
|
(222
|
)
|
|
—
|
|
|
(222
|
)
|
|
—
|
|
||||
Merger, acquisition and disposition activities
(c)
|
1,499
|
|
|
212
|
|
|
1,621
|
|
|
339
|
|
||||
Stock-based compensation and expense
(d)
|
252
|
|
|
224
|
|
|
479
|
|
|
424
|
|
||||
Adjusted EBITDA
|
12,674
|
|
|
12,895
|
|
|
21,533
|
|
|
21,890
|
|
||||
Change in deferred revenues
|
(7,900
|
)
|
|
(10,576
|
)
|
|
(24,814
|
)
|
|
(27,419
|
)
|
||||
Change in deferred costs
|
1,132
|
|
|
1,168
|
|
|
2,589
|
|
|
2,731
|
|
||||
Capital expenditures
|
(3,980
|
)
|
|
(4,284
|
)
|
|
(7,988
|
)
|
|
(8,816
|
)
|
||||
Cash income
|
$
|
1,926
|
|
|
$
|
(797
|
)
|
|
$
|
(8,680
|
)
|
|
$
|
(11,614
|
)
|
|
Three Months Ended June 30, 2018
|
||||||||||||||
(in thousands)
|
Learning A-Z
|
|
ExploreLearning
|
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
Bookings
|
$
|
14,683
|
|
|
$
|
6,797
|
|
|
$
|
11,636
|
|
|
$
|
33,116
|
|
Change in deferred revenues
|
5,752
|
|
|
991
|
|
|
1,157
|
|
|
7,900
|
|
||||
Other
(a)
|
—
|
|
|
(56
|
)
|
|
36
|
|
|
(20
|
)
|
||||
Net revenues
|
$
|
20,435
|
|
|
$
|
7,732
|
|
|
$
|
12,829
|
|
|
$
|
40,996
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||
(in thousands)
|
Learning A-Z
|
|
ExploreLearning
|
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
Bookings
|
$
|
24,282
|
|
|
$
|
9,970
|
|
|
$
|
18,717
|
|
|
$
|
52,969
|
|
Change in deferred revenues
|
15,289
|
|
|
5,338
|
|
|
4,187
|
|
|
24,814
|
|
||||
Other
(a)
|
—
|
|
|
(72
|
)
|
|
(108
|
)
|
|
(180
|
)
|
||||
Net revenues
|
$
|
39,571
|
|
|
$
|
15,236
|
|
|
$
|
22,796
|
|
|
$
|
77,603
|
|
|
Three Months Ended June 30, 2018
|
||||||||||||||||||
(in thousands)
|
Learning A-Z
|
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net income
|
$
|
9,888
|
|
|
$
|
2,776
|
|
|
$
|
2,937
|
|
|
$
|
(11,166
|
)
|
|
$
|
4,435
|
|
Reconciling items between net income and EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
4,761
|
|
|
4,761
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
927
|
|
|
927
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
1,022
|
|
|
1,022
|
|
|||||
Income from operations before interest, income taxes, and depreciation and amortization (EBITDA)
|
9,888
|
|
|
2,776
|
|
|
2,937
|
|
|
(4,456
|
)
|
|
11,145
|
|
|||||
Non-operational or non-cash costs included in EBITDA but excluded from Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from sale of excess state tax credits
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
(222
|
)
|
|
(222
|
)
|
|||||
Merger, acquisition and disposition activities
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,499
|
|
|
1,499
|
|
|||||
Stock-based compensation and expense
(d)
|
70
|
|
|
55
|
|
|
59
|
|
|
68
|
|
|
252
|
|
|||||
Adjusted EBITDA
|
9,958
|
|
|
2,831
|
|
|
2,996
|
|
|
(3,111
|
)
|
|
12,674
|
|
|||||
Change in deferred revenues
|
(5,752
|
)
|
|
(991
|
)
|
|
(1,157
|
)
|
|
—
|
|
|
(7,900
|
)
|
|||||
Change in deferred costs
|
597
|
|
|
282
|
|
|
253
|
|
|
—
|
|
|
1,132
|
|
|||||
Capital expenditures - product development
|
(2,006
|
)
|
|
(1,017
|
)
|
|
(548
|
)
|
|
—
|
|
|
(3,571
|
)
|
|||||
Capital expenditures - general expenditures
|
(318
|
)
|
|
(65
|
)
|
|
(9
|
)
|
|
(17
|
)
|
|
(409
|
)
|
|||||
Cash income
|
$
|
2,479
|
|
|
$
|
1,040
|
|
|
$
|
1,535
|
|
|
$
|
(3,128
|
)
|
|
$
|
1,926
|
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||
(in thousands)
|
Learning A-Z
|
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net income
|
$
|
18,777
|
|
|
$
|
5,347
|
|
|
$
|
3,790
|
|
|
$
|
(20,872
|
)
|
|
$
|
7,042
|
|
Reconciling items between net income and EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
9,382
|
|
|
9,382
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
1,757
|
|
|
1,757
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
1,474
|
|
|
1,474
|
|
|||||
Income from operations before interest, income taxes, and depreciation and amortization (EBITDA)
|
18,777
|
|
|
5,347
|
|
|
3,790
|
|
|
(8,259
|
)
|
|
19,655
|
|
|||||
Non-operational or non-cash costs included in EBITDA but excluded from Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from sale of excess state tax credits
(b)
|
—
|
|
|
—
|
|
|
—
|
|
|
(222
|
)
|
|
(222
|
)
|
|||||
Merger, acquisition and disposition activities
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,621
|
|
|
1,621
|
|
|||||
Stock-based compensation and expense
(d)
|
127
|
|
|
100
|
|
|
118
|
|
|
134
|
|
|
479
|
|
|||||
Adjusted EBITDA
|
18,904
|
|
|
5,447
|
|
|
3,908
|
|
|
(6,726
|
)
|
|
21,533
|
|
|||||
Change in deferred revenues
|
(15,289
|
)
|
|
(5,338
|
)
|
|
(4,187
|
)
|
|
—
|
|
|
(24,814
|
)
|
|||||
Change in deferred costs
|
1,292
|
|
|
657
|
|
|
640
|
|
|
—
|
|
|
2,589
|
|
|||||
Capital expenditures - product development
|
(3,874
|
)
|
|
(2,036
|
)
|
|
(1,195
|
)
|
|
—
|
|
|
(7,105
|
)
|
|||||
Capital expenditures - general expenditures
|
(576
|
)
|
|
(161
|
)
|
|
(115
|
)
|
|
(31
|
)
|
|
(883
|
)
|
|||||
Cash income
|
$
|
457
|
|
|
$
|
(1,431
|
)
|
|
$
|
(949
|
)
|
|
$
|
(6,757
|
)
|
|
$
|
(8,680
|
)
|
|
Three Months Ended June 30, 2017
|
||||||||||||||
(in thousands)
|
Learning A-Z
|
|
ExploreLearning
|
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
Bookings
|
$
|
11,661
|
|
|
$
|
5,888
|
|
|
$
|
12,192
|
|
|
$
|
29,741
|
|
Change in deferred revenues
|
6,990
|
|
|
873
|
|
|
2,713
|
|
|
10,576
|
|
||||
Other
(a)
|
(1
|
)
|
|
(26
|
)
|
|
72
|
|
|
45
|
|
||||
Net revenues
|
$
|
18,650
|
|
|
$
|
6,735
|
|
|
$
|
14,977
|
|
|
$
|
40,362
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||
(in thousands)
|
Learning A-Z
|
|
ExploreLearning
|
|
Voyager Sopris
Learning |
|
Consolidated
|
||||||||
Bookings
|
$
|
21,560
|
|
|
$
|
8,764
|
|
|
$
|
18,529
|
|
|
$
|
48,853
|
|
Change in deferred revenues
|
15,275
|
|
|
4,854
|
|
|
7,290
|
|
|
27,419
|
|
||||
Other
(a)
|
—
|
|
|
(105
|
)
|
|
165
|
|
|
60
|
|
||||
Net revenues
|
$
|
36,835
|
|
|
$
|
13,513
|
|
|
$
|
25,984
|
|
|
$
|
76,332
|
|
|
Three Months Ended June 30, 2017
|
||||||||||||||||||
(in thousands)
|
Learning A-Z
|
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net income
|
$
|
9,688
|
|
|
$
|
2,814
|
|
|
$
|
3,408
|
|
|
$
|
(10,118
|
)
|
|
$
|
5,792
|
|
Reconciling items between net income and EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
4,997
|
|
|
4,997
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
1,336
|
|
|
1,336
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
334
|
|
|
334
|
|
|||||
Income from operations before interest, income taxes, and depreciation and amortization (EBITDA)
|
9,688
|
|
|
2,814
|
|
|
3,408
|
|
|
(3,451
|
)
|
|
12,459
|
|
|||||
Non-operational or non-cash costs included in EBITDA but excluded from Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Merger, acquisition and disposition activities
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
212
|
|
|
212
|
|
|||||
Stock-based compensation and expense
(d)
|
53
|
|
|
30
|
|
|
75
|
|
|
66
|
|
|
224
|
|
|||||
Adjusted EBITDA
|
9,741
|
|
|
2,844
|
|
|
3,483
|
|
|
(3,173
|
)
|
|
12,895
|
|
|||||
Change in deferred revenues
|
(6,990
|
)
|
|
(873
|
)
|
|
(2,713
|
)
|
|
—
|
|
|
(10,576
|
)
|
|||||
Change in deferred costs
|
547
|
|
|
104
|
|
|
517
|
|
|
—
|
|
|
1,168
|
|
|||||
Capital expenditures - product development
|
(1,869
|
)
|
|
(721
|
)
|
|
(1,316
|
)
|
|
—
|
|
|
(3,906
|
)
|
|||||
Capital expenditures - general expenditures
|
(220
|
)
|
|
(77
|
)
|
|
(45
|
)
|
|
(36
|
)
|
|
(378
|
)
|
|||||
Cash income
|
$
|
1,209
|
|
|
$
|
1,277
|
|
|
$
|
(74
|
)
|
|
$
|
(3,209
|
)
|
|
$
|
(797
|
)
|
|
Six Months Ended June 30, 2017
|
||||||||||||||||||
(in thousands)
|
Learning A-Z
|
|
Explore
Learning |
|
Voyager Sopris
Learning |
|
Other
|
|
Consolidated
|
||||||||||
Net income
|
$
|
18,556
|
|
|
$
|
5,490
|
|
|
$
|
4,043
|
|
|
$
|
(19,767
|
)
|
|
$
|
8,322
|
|
Reconciling items between net income and EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization expense
|
—
|
|
|
—
|
|
|
—
|
|
|
9,768
|
|
|
9,768
|
|
|||||
Net interest expense
|
—
|
|
|
—
|
|
|
—
|
|
|
2,563
|
|
|
2,563
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
474
|
|
|
474
|
|
|||||
Income from operations before interest, income taxes, and depreciation and amortization (EBITDA)
|
18,556
|
|
|
5,490
|
|
|
4,043
|
|
|
(6,962
|
)
|
|
21,127
|
|
|||||
Non-operational or non-cash costs included in EBITDA but excluded from Adjusted EBITDA:
|
|
|
|
|
|
|
|
|
|
||||||||||
Merger, acquisition and disposition activities
(c)
|
—
|
|
|
—
|
|
|
—
|
|
|
339
|
|
|
339
|
|
|||||
Stock-based compensation and expense
(d)
|
100
|
|
|
54
|
|
|
145
|
|
|
125
|
|
|
424
|
|
|||||
Adjusted EBITDA
|
18,656
|
|
|
5,544
|
|
|
4,188
|
|
|
(6,498
|
)
|
|
21,890
|
|
|||||
Change in deferred revenues
|
(15,275
|
)
|
|
(4,854
|
)
|
|
(7,290
|
)
|
|
—
|
|
|
(27,419
|
)
|
|||||
Change in deferred costs
|
1,162
|
|
|
493
|
|
|
1,076
|
|
|
—
|
|
|
2,731
|
|
|||||
Capital expenditures - product development
|
(3,798
|
)
|
|
(1,481
|
)
|
|
(2,809
|
)
|
|
—
|
|
|
(8,088
|
)
|
|||||
Capital expenditures - general expenditures
|
(393
|
)
|
|
(167
|
)
|
|
(115
|
)
|
|
(53
|
)
|
|
(728
|
)
|
|||||
Cash income
|
$
|
352
|
|
|
$
|
(465
|
)
|
|
$
|
(4,950
|
)
|
|
$
|
(6,551
|
)
|
|
$
|
(11,614
|
)
|
(a)
|
In the reconciliations of Bookings to Net Revenues, Other comprises timing differences between the invoicing of a transaction, which generates Bookings, and its recognition as either net revenues or deferred revenues. The most common reasons for these timing differences include product that is shipped from our warehouse and invoiced but not recognized as revenues until physical delivery, adjustments to the allowance for estimated sales returns, and revenue under contract that is earned and recognized in one period but invoiced in a subsequent period.
|
(b)
|
In the second quarter of 2018, we recorded other income resulting from the sale of excess state research and development tax credits.
|
(c)
|
Costs are related to merger and acquisition activities including due diligence and other non-operational charges such as pension. The second quarter of 2018 includes $1.1 million of expenses incurred related to the Company's definitive agreement to acquire VKIDZ Holdings Inc. and its review of strategic alternatives.
|
(d)
|
Stock-based compensation and expense is related to our outstanding options.
|
Exhibit
Number
|
|
Description
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31.1
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31.2
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32.1
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32.2
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101.ins
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XBRL Instance Document.
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101.def
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XBRL Taxonomy Extension Definition Linkbase Document.
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101.sch
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XBRL Taxonomy Extension Schema Document.
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101.cal
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XBRL Taxonomy Extension Calculation Linkbase Document.
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101.lab
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XBRL Taxonomy Extension Label Linkbase Document.
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101.pre
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XBRL Taxonomy Extension Presentation Linkbase Document.
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CAMBIUM LEARNING GROUP, INC.
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Date: August 13, 2018
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/s/ Barbara Benson
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Barbara Benson,
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Chief Financial Officer (Principal Financial Officer)
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1 Year Cambium Learning Grp., Inc. (delisted) Chart |
1 Month Cambium Learning Grp., Inc. (delisted) Chart |
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