Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 30, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | Party City Holdco Inc. | |
Document Type | 10-Q | |
Trading Symbol | PRTY | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 110,646,150 | |
Amendment Flag | false | |
Entity Central Index Key | 0001592058 | |
Entity Filer Category | Accelerated Filer | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Security Exchange Name | NYSE | |
Entity File Number | 001-37344 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-0539758 | |
Entity Address, Address Line One | 80 Grasslands Road | |
Entity Address, City or Town | Elmsford | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10523 | |
City Area Code | 914 | |
Local Phone Number | 345-2020 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | Common Stock |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 170,562 | $ 34,917 |
Accounts receivable, net | 149,825 | 149,109 |
Inventories, net | 630,357 | 658,419 |
Prepaid expenses and other current assets | 112,038 | 51,685 |
Total current assets | 1,062,782 | 894,130 |
Property, plant and equipment, net | 206,447 | 243,572 |
Operating lease asset | 741,524 | 802,634 |
Goodwill | 669,564 | 1,072,330 |
Trade names | 383,666 | 530,320 |
Other intangible assets, net | 34,505 | 45,060 |
Other assets, net | 9,521 | 7,273 |
Total assets | 3,108,009 | 3,595,319 |
Current liabilities: | ||
Loans and notes payable | 303,894 | 128,806 |
Accounts payable | 179,938 | 152,300 |
Accrued expenses | 202,636 | 150,921 |
Current portion of operating lease liability | 194,476 | 155,471 |
Income taxes payable | 35,905 | |
Current portion of long-term obligations | 14,342 | 71,524 |
Total current liabilities | 895,286 | 694,927 |
Long-term obligations, excluding current portion | 1,334,338 | 1,503,987 |
Long-term portion of operating lease liability | 677,183 | 720,735 |
Deferred income tax liabilities, net | 49,508 | 126,081 |
Other long-term liabilities | 15,559 | 16,517 |
Total liabilities | 2,971,874 | 3,062,247 |
Redeemable securities | 3,351 | |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Common stock (110,573,555 and 94,461,576 shares outstanding and 121,848,074 and 121,662,540 shares issued at September 30, 2020 and December 31, 2019, respectively) | 1,371 | 1,211 |
Additional paid-in capital | 970,145 | 928,573 |
Accumulated deficit | (469,040) | (37,219) |
Accumulated other comprehensive loss | (38,907) | (35,734) |
Total Party City Holdco Inc. stockholders’ equity before common stock held in treasury | 463,569 | 856,831 |
Less: Common stock held in treasury, at cost (11,274,519 and 27,200,964 shares at September 30, 2020 and December 31, 2019, respectively) | (327,170) | (327,086) |
Total Party City Holdco Inc. stockholders’ equity | 136,399 | 529,745 |
Noncontrolling interests | (264) | (24) |
Total stockholders’ equity | 136,135 | 529,721 |
Total liabilities, redeemable securities and stockholders’ equity | $ 3,108,009 | $ 3,595,319 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - shares | Sep. 30, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Common stock, shares outstanding | 110,573,555 | 94,461,576 |
Common stock, shares issued | 121,848,074 | 121,662,540 |
Treasury stock, shares | 11,274,519 | 27,200,964 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenues: | ||||
Total revenues | $ 533,775 | $ 540,231 | $ 1,202,509 | $ 1,617,238 |
Cost of sales | 355,923 | 373,413 | 890,587 | 1,065,511 |
Wholesale selling expenses | 11,950 | 16,084 | 37,115 | 50,929 |
Retail operating expenses | 97,100 | 111,595 | 250,502 | 302,756 |
Franchise expenses | 2,795 | 3,274 | 9,225 | 9,813 |
General and administrative expenses | 42,191 | 43,062 | 162,118 | 126,497 |
Art and development costs | 4,257 | 5,927 | 13,095 | 17,568 |
Development stage expenses | 2,728 | 2,932 | 7,966 | |
(Gain) on sale/leaseback transaction | (58,381) | |||
Store impairment and restructuring charges | 1,926 | 2,574 | 20,818 | 25,817 |
Goodwill, intangibles and long-lived assets impairment | 44,732 | 259,100 | 581,380 | 259,100 |
Total expenses | 560,874 | 817,757 | 1,967,772 | 1,807,576 |
(Loss) from operations | (27,099) | (277,526) | (765,263) | (190,338) |
Interest expense, net | 13,422 | 29,424 | 63,954 | 88,857 |
Other (income) expense, net | (2,873) | 2,047 | 4,287 | 6,643 |
(Gain) on debt refinancing | (273,149) | (273,149) | ||
Income (loss) before income taxes | 235,501 | (308,997) | (560,355) | (285,838) |
Income tax (benefit) | (4,164) | (27,252) | (128,293) | (21,809) |
Net income (loss) | 239,665 | (281,745) | (432,062) | (264,029) |
Less: Net (loss) attributable to noncontrolling interests | (42) | (212) | (241) | (352) |
Net income (loss) attributable to common shareholders of Party City Holdco Inc. | $ 239,707 | $ (281,533) | $ (431,821) | $ (263,677) |
Net income (loss) per share attributable to common shareholders of Party City Holdco Inc.–Basic | $ 2.25 | $ (3.02) | $ (4.41) | $ (2.83) |
Net income (loss) per share attributable to common shareholders of Party City Holdco Inc.–Diluted | $ 2.24 | $ (3.02) | $ (4.41) | $ (2.83) |
Weighted-average number of common shares-Basic | 106,709,307 | 93,346,448 | 97,872,174 | 93,271,392 |
Weighted-average number of common shares-Diluted | 106,875,631 | 93,346,448 | 97,872,174 | 93,271,392 |
Comprehensive income (loss) | $ 244,607 | $ (288,573) | $ (435,235) | $ (266,883) |
Less: Comprehensive (loss) attributable to noncontrolling interests | (42) | (213) | (241) | (364) |
Comprehensive income (loss) attributable to common shareholders of Party City Holdco Inc. | 244,649 | (288,360) | (434,994) | (266,519) |
Net Sales [Member] | ||||
Revenues: | ||||
Revenues | 532,053 | 538,345 | 1,198,160 | 1,611,149 |
Royalties and Franchise Fees [Member] | ||||
Revenues: | ||||
Revenues | $ 1,722 | $ 1,886 | $ 4,349 | $ 6,089 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect of Change in Accounting Principle, Net [Member] | Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Time-Based Units [Member] | Performance-Based Units [Member] | Common Stock [Member] | Common Stock [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Additional Paid-in Capital [Member] | Additional Paid-in Capital [Member]Cumulative Effect of Change in Accounting Principle, Net [Member] | Additional Paid-in Capital [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Additional Paid-in Capital [Member]Time-Based Units [Member] | Additional Paid-in Capital [Member]Performance-Based Units [Member] | (Accumulated Deficit) Retained Earnings [Member] | (Accumulated Deficit) Retained Earnings [Member]Cumulative Effect of Change in Accounting Principle, Net [Member] | (Accumulated Deficit) Retained Earnings [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Other Comprehensive Loss [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Total Party City Holdco Inc. Stockholders' Equity Before Common Stock Held In Treasury [Member] | Total Party City Holdco Inc. Stockholders' Equity Before Common Stock Held In Treasury [Member]Cumulative Effect of Change in Accounting Principle, Net [Member] | Total Party City Holdco Inc. Stockholders' Equity Before Common Stock Held In Treasury [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Total Party City Holdco Inc. Stockholders' Equity Before Common Stock Held In Treasury [Member]Time-Based Units [Member] | Total Party City Holdco Inc. Stockholders' Equity Before Common Stock Held In Treasury [Member]Performance-Based Units [Member] | Common Stock Held In Treasury [Member] | Common Stock Held In Treasury [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Total Party City Holdco Inc. Stockholders' Equity [Member] | Total Party City Holdco Inc. Stockholders' Equity [Member]Cumulative Effect of Change in Accounting Principle, Net [Member] | Total Party City Holdco Inc. Stockholders' Equity [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] | Total Party City Holdco Inc. Stockholders' Equity [Member]Time-Based Units [Member] | Total Party City Holdco Inc. Stockholders' Equity [Member]Performance-Based Units [Member] | Non-Controlling Interests [Member] | Non-Controlling Interests [Member]Cumulative Effect of Change in Accounting Principle, Net Adjusted [Member] |
Balance at Dec. 31, 2018 | $ 1,043,621 | $ 159 | $ 1,043,780 | $ 1,208 | $ 1,208 | $ 922,476 | $ 662 | $ 923,138 | $ 495,777 | $ (503) | $ 495,274 | $ (49,201) | $ (49,201) | $ 1,370,260 | $ 159 | $ 1,370,419 | $ (326,930) | $ (326,930) | $ 1,043,330 | $ 159 | $ 1,043,489 | $ 291 | $ 291 | ||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201807Member | ||||||||||||||||||||||||||||||
Net income (loss) | $ (264,029) | (263,677) | (263,677) | (263,677) | (352) | ||||||||||||||||||||||||||
Stock option expense | 1,150 | 1,150 | 1,150 | 1,150 | |||||||||||||||||||||||||||
Restricted stock units | $ 1,543 | $ 1,036 | $ 1,543 | $ 1,036 | $ 1,543 | $ 1,036 | $ 1,543 | $ 1,036 | |||||||||||||||||||||||
Director – non-cash compensation | 313 | 313 | 313 | 313 | |||||||||||||||||||||||||||
Warrant expense | 386 | 386 | 386 | 386 | |||||||||||||||||||||||||||
Exercise of stock options | 1,145 | 3 | 1,142 | 1,145 | 1,145 | ||||||||||||||||||||||||||
Acquired non-controlling interest | 112 | 41 | 41 | 41 | 71 | ||||||||||||||||||||||||||
Treasury Stock purchases | (156) | (156) | (156) | ||||||||||||||||||||||||||||
Foreign currency adjustments | (2,220) | (2,208) | (2,208) | (2,208) | (12) | ||||||||||||||||||||||||||
Impact of foreign exchange contracts, net | (634) | (634) | (634) | (634) | |||||||||||||||||||||||||||
Balance at Sep. 30, 2019 | 782,426 | 1,211 | 928,749 | 231,597 | (52,043) | 1,109,514 | (327,086) | 782,428 | (2) | ||||||||||||||||||||||
Balance at Jun. 30, 2019 | 1,069,087 | 1,210 | 926,838 | 513,130 | (45,216) | 1,395,962 | (327,086) | 1,068,876 | 211 | ||||||||||||||||||||||
Net income (loss) | (281,745) | (281,533) | (281,533) | (281,533) | (212) | ||||||||||||||||||||||||||
Stock option expense | 409 | 409 | 409 | 409 | |||||||||||||||||||||||||||
Restricted stock units | 610 | 560 | 610 | 560 | 610 | 560 | 610 | 560 | |||||||||||||||||||||||
Director – non-cash compensation | 148 | 148 | 148 | 148 | |||||||||||||||||||||||||||
Warrant expense | 128 | 128 | 128 | 128 | |||||||||||||||||||||||||||
Exercise of stock options | 57 | 1 | 56 | 57 | 57 | ||||||||||||||||||||||||||
Foreign currency adjustments | (6,921) | (6,920) | (6,920) | (6,920) | (1) | ||||||||||||||||||||||||||
Impact of foreign exchange contracts, net | 93 | 93 | 93 | 93 | |||||||||||||||||||||||||||
Balance at Sep. 30, 2019 | 782,426 | 1,211 | 928,749 | 231,597 | (52,043) | 1,109,514 | (327,086) | 782,428 | (2) | ||||||||||||||||||||||
Balance at Dec. 31, 2019 | 529,721 | 1,211 | 928,573 | (37,219) | (35,734) | 856,831 | (327,086) | 529,745 | (24) | ||||||||||||||||||||||
Net income (loss) | (432,062) | (431,821) | (431,821) | (431,821) | (241) | ||||||||||||||||||||||||||
Stock option expense | 671 | 7,847 | 671 | 7,847 | 671 | 7,847 | 671 | 7,847 | |||||||||||||||||||||||
Restricted stock units | 1,568 | 481 | 1,568 | 481 | 1,568 | 481 | 1,568 | 481 | |||||||||||||||||||||||
Director – non-cash compensation | 75 | 75 | 75 | 75 | |||||||||||||||||||||||||||
Warrant expense | 1,033 | 1,033 | 1,033 | 1,033 | |||||||||||||||||||||||||||
Acquired non-controlling interest | 2,317 | 2,316 | 2,316 | 2,316 | 1 | ||||||||||||||||||||||||||
Treasury Stock purchases | (84) | (84) | (84) | ||||||||||||||||||||||||||||
Issuance of Stock for Debt exchange including costs | 27,741 | 160 | 27,581 | 27,741 | 27,741 | ||||||||||||||||||||||||||
Foreign currency adjustments | (3,111) | (3,111) | (3,111) | (3,111) | |||||||||||||||||||||||||||
Impact of foreign exchange contracts, net | (62) | (62) | (62) | (62) | |||||||||||||||||||||||||||
Balance at Sep. 30, 2020 | 136,135 | 1,371 | 970,145 | (469,040) | (38,907) | 463,569 | (327,170) | 136,399 | (264) | ||||||||||||||||||||||
Balance at Jun. 30, 2020 | (137,016) | 1,211 | 941,745 | (708,747) | (43,849) | 190,360 | (327,170) | (136,810) | (206) | ||||||||||||||||||||||
Net income (loss) | 239,665 | 239,707 | 239,707 | 239,707 | (42) | ||||||||||||||||||||||||||
Stock option expense | 111 | 111 | 111 | 111 | |||||||||||||||||||||||||||
Restricted stock units | $ 429 | $ 481 | $ 429 | $ 481 | $ 429 | $ 481 | $ 429 | $ 481 | |||||||||||||||||||||||
Acquired non-controlling interest | (218) | (202) | (202) | (202) | (16) | ||||||||||||||||||||||||||
Issuance of Stock for Debt exchange including costs | 27,741 | 160 | 27,581 | 27,741 | 27,741 | ||||||||||||||||||||||||||
Foreign currency adjustments | 5,076 | 5,076 | 5,076 | 5,076 | |||||||||||||||||||||||||||
Impact of foreign exchange contracts, net | (134) | (134) | (134) | (134) | |||||||||||||||||||||||||||
Balance at Sep. 30, 2020 | $ 136,135 | $ 1,371 | $ 970,145 | $ (469,040) | $ (38,907) | $ 463,569 | $ (327,170) | $ 136,399 | $ (264) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows used in operating activities: | ||
Net (loss) income | $ (432,062) | $ (264,029) |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation and amortization expense | 57,796 | 62,380 |
Amortization of deferred financing costs and original issuance discounts | 3,276 | 3,511 |
Provision for doubtful accounts | 5,746 | 1,110 |
Deferred income tax benefit | (76,833) | (26,458) |
Change in operating lease liability/asset | 32,121 | (23,361) |
Undistributed (income) loss in equity method investments | 356 | (195) |
Loss (gain) on disposal of assets | 83 | (59,088) |
Non-cash adjustment for store impairment and restructuring charges | 16,595 | 19,443 |
Goodwill, intangibles and long-lived assets impairment | 581,380 | 259,100 |
Non-employee equity-based compensation (see Note 19 – Kazzam, LLC) | 1,033 | 386 |
Stock option expense – time – based | 671 | 1,150 |
Stock option expense – performance – based | 7,847 | |
Restricted stock unit expense – time-based | 1,568 | 1,543 |
Restricted stock unit and restricted cash awards expense – performance-based | 510 | 1,036 |
Directors – non-cash compensation | 75 | 313 |
Gain on debt refinancing | (273,149) | |
Changes in operating assets and liabilities, net of effects of acquired businesses: | ||
(Increase) in accounts receivable | (8,562) | (23,712) |
Decrease (increase) in inventories | 27,959 | (35,628) |
Increase in prepaid expenses and other current assets | (64,715) | (11,009) |
Decrease (increase) in accounts payable, accrued expenses and income taxes payable | 61,478 | (88,771) |
Net cash used in operating activities | (56,827) | (182,279) |
Cash flows (used in) provided by investing activities: | ||
Cash paid in connection with acquisitions, net of cash acquired | (362) | (9,485) |
Capital expenditures | (32,095) | (45,769) |
Proceeds from disposal of property and equipment | 82 | 113,845 |
Net cash (used in) provided by investing activities | (32,375) | 58,591 |
Cash flows provided by financing activities: | ||
Repayment of loans, notes payable and long-term obligations | (122,373) | (106,133) |
Proceeds from loans, notes payable and long-term obligations | 369,785 | 203,381 |
Stock repurchases | (85) | (156) |
Exercise of stock options | 1,145 | |
Debt issuance costs | (19,955) | (411) |
Net cash provided by financing activities | 227,372 | 97,826 |
Effect of exchange rate changes on cash and cash equivalents | (2,659) | 1,220 |
Net increase (decrease) in cash and cash equivalents and restricted cash | 135,511 | (24,642) |
Cash and cash equivalents and restricted cash at beginning of period | 35,176 | 59,219 |
Cash and cash equivalents and restricted cash at end of period | 170,687 | 34,577 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the period for interest | 55,999 | 97,744 |
Cash paid during the period for income taxes, net of refunds | $ 24,421 | $ 34,357 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of Business | Note 1 – Description of Business Party City Holdco Inc. (the “Company” or “Party City Holdco”) is the leading party goods company by revenue in North America and, we believe, the largest vertically integrated supplier of decorated party goods globally by revenue. The Company is a popular one-stop shopping destination for party supplies, balloons, and costumes. In addition to being a great retail brand, the Company is a global, world-class organization that combines state-of-the-art manufacturing and sourcing operations, and sophisticated wholesale operations complemented by a multi-channel retailing strategy and e-commerce retail operations. The Company is a leading player in its category and vertically integrated in its breadth and depth. The Company designs, manufactures, sources and distributes party goods, including paper and plastic tableware, metallic and latex balloons, Halloween and other costumes, accessories, novelties, gifts and stationery throughout the world. As of September 30, 2020 the Company’s retail operations include 829 specialty retail party supply stores (including franchise stores) throughout the United States and Mexico operating under the names Party City and Halloween City, and e-commerce websites, including through the domain name PartyCity.com and others. In March 2020, the World Health Organization declared COVID-19 a global pandemic, and governmental authorities around the world have implemented measures to reduce the spread of the virus. The global spread of COVID-19 and the measures to contain it have negatively impacted the global economy, disrupted global supply chains, and created significant volatility and disruption in financial markets. In response to COVID-19, to safeguard the health and safety of its team members and customers, the Company temporarily closed all of its corporate retail stores as of March 18, 2020. During the temporary store closures, the Company offered curbside pickup and the Company’s e-commerce site, www.partycity.com, remained fully operational. Party City Holdco is a holding company with no operating assets or operations. The Company owns 100% of PC Nextco Holdings, LLC (“PC Nextco”), which owns 100% of PC Intermediate Holdings, Inc. (“PC Intermediate”). PC Intermediate owns 100% of Party City Holdings Inc. (“PCHI”), which owns most of the Company’s operating subsidiaries. |
Basis of Presentation and Recen
Basis of Presentation and Recently Issued Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Recently Issued Accounting Pronouncements | Note 2 – Basis of Presentation and Recently Issued Accounting Pronouncements The unaudited condensed consolidated financial statements of the Company include the accounts of the Company and its majority-owned and controlled entities. All intercompany balances and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation have been included in the unaudited condensed consolidated financial statements. The majority of our retail operations define a fiscal year (“Fiscal Year”) as the 52-week period or 53-week period ended on the Saturday nearest December 31st of each year and define fiscal quarters (“Fiscal Quarter”) as the four interim 13-week periods following the end of the previous Fiscal Year, except in the case of a 53-week Fiscal Year when the fourth Fiscal Quarter is extended to 14 weeks. The condensed consolidated financial statements of the Company combine the Fiscal Quarters of our retail operations with the calendar quarters of our wholesale operations. The Company has determined the differences between the retail operation’s Fiscal Year and Fiscal Quarters and the calendar year and calendar quarters to be insignificant. Operating results for interim periods are not necessarily indicative of the results to be expected for the year ending December 31, 2020. Our business is subject to substantial seasonal variations as our retail segment has historically realized a significant portion of its net sales, cash flows and net income in the fourth quarter of each year, principally due to its Halloween season sales in October and, to a lesser extent, other year-end holiday sales. We expect that this general pattern will continue. Our results of operations may also be affected by industry factors that may be specific to a particular period, such as movement in and the general level of raw material costs and the uncertainty surrounding the impact of the COVID-19 pandemic. Recently Issued and Adopted Accounting Pronouncements In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-13, “Fair Value Measurement (Topic 820) – Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement”. The new guidance improves and clarifies the fair value measurement disclosure requirements of ASC 820. The new disclosure requirements include the disclosure of the changes in unrealized gains or losses included in other comprehensive (loss) income for recurring Level 3 fair value measurements held at the end of the reporting period and the explicit requirement to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The other provisions of ASU 2018-13 also include eliminated and modified disclosure requirements. The guidance was effective for fiscal years beginning after December 15, 2019. The Company has adopted this guidance effective January 1, 2020, prospectively and the adoption and application of this standard did not have a material impact to the consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, “Compensation — Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting”. The ASU simplifies the accounting for non-employee share-based payments. The Company adopted the update during the first quarter of 2019. The pronouncement requires companies to record the impact of adoption, if any, as a cumulative-effect adjustment to retained earnings as of the adoption date. Therefore, on January 1, 2019, the Company decreased retained earnings by $503. Additionally, the Company increased additional paid-in capital by $662 and recorded a $159 deferred income tax asset. In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The pronouncement amends the existing hedge accounting model in order to enable entities to better portray the economics of their risk management activities in their financial statements. The Company adopted the update during the first quarter of 2019 and such adoption had no impact on the Company’s consolidated financial statements. In January 2017 the FASB issued ASU No. 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment”, which eliminates the requirement to measure a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under the amendments in ASU 2017-04, an entity will perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized will not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity will consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The Company adopted ASU No. 2017-04 during the first quarter of 2019 and such adoption had no impact on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses”. The ASU changes how entities will account for credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The ASU requires that an entity measure and recognize expected credit losses at the time the asset is recorded, while considering a broader range of information to estimate credit losses including macroeconomic conditions that correlate with historical loss experience, delinquency trends and aging behavior of receivables, among others. The Company has adopted this guidance effective January 1, 2020, prospectively, with respect to its receivables, and the adoption and application of this standard did not have a material impact to the consolidated financial statements during the first nine months of 2020. The Company maintains allowances for credit losses resulting from the inability of the Company’s customers to make required payments. Judgment is required in assessing the ultimate realization of these receivables, including consideration of the Company’s history of receivable write-offs, the level of past due accounts and the economic status of the Company’s customers. In an effort to identify adverse trends relative to customer economic status, the Company assesses the financial health of the markets it operates in and performs periodic credit evaluations of its customers and ongoing reviews of account balances and aging of receivables. Amounts are considered past due when payment has not been received within the time frame of the credit terms extended. Write-offs are charged directly against the allowance for credit losses and occur only after all collection efforts have been exhausted. The Company will continue to actively monitor the impact of the COVID-19 pandemic on expected losses. At September 30, 2020 and December 31, 2019, the allowance for credit losses was $9,590 and $4,786, respectively. In February 2016, the FASB issued ASU 2016-02, “Leases”. The ASU requires that companies recognize assets and liabilities for the rights and obligations created by companies’ leases. The Company’s lease portfolio is primarily comprised of store leases, manufacturing and distribution facility leases, warehouse leases and office leases. The Company adopted the new lease standard during the first quarter of 2019 and, to the extent required by the pronouncement, recognized a right of use asset and liability for its operating lease arrangements with terms of greater than twelve months. The pronouncement had no impact on the Company’s consolidated statement of operations and comprehensive loss and it did not impact the Company’s compliance with its debt covenants. Additionally, the standard requires companies to make certain annual disclosures, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. |
Store Impairment and Restructur
Store Impairment and Restructuring Charges | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring And Related Activities [Abstract] | |
Store Impairment and Restructuring Charges | Note 3 – Store Impairment and Restructuring Charges The Company performed a comprehensive review of its store locations aimed at improving the overall productivity of such locations (“store optimization program”). After careful consideration and evaluation of the store locations, the Company made the decision to accelerate the optimization of its store portfolio with the closure of stores, which are primarily located in close proximity to other Party City stores. In 2019, 55 stores were identified for closure, out of which 35 stores were closed in 2019 and 20 stores were closed in January 2020. In addition, 21 stores identified for closure in the first quarter of 2020 were closed in the third quarter. These closings should provide the Company with capital flexibility to expand into underserved markets. In addition, the Company evaluated the recoverability of long lived assets at the open stores and recorded an impairment charge associated with the operating lease asset and property, plant and equipment for open stores where sales were affected due to the outbreak of, and local, state and federal governmental responses to, COVID-19. In conjunction with the store optimization program and store impairment, during the three and nine months ended September 30, 2020 and 2019, the Company recorded the following charges: Three Months Ended September 30, 2020 2019 Inventory reserves $ 1,184 $ — Operating lease asset impairment 137 — Labor and other costs incurred closing stores 1,789 2,574 Total $ 3,110 $ 2,574 Nine Months Ended September 30, 2020 2019 Inventory reserves $ 12,880 $ 21,285 Operating lease asset impairment 14,530 14,149 Property, plant and equipment impairment 2,065 4,680 Labor and other costs incurred closing stores 4,223 6,327 Severance — 661 Total $ 33,698 $ 47,102 Amounts disclosed above represent the Company’s best estimate of the total charges that are expected to be recorded. As the Company closes the stores, it records charges for common area maintenance, insurance and taxes to be paid subsequent to such closures in accordance with the stores’ lease agreements. However, such amounts are immaterial. Additionally, the Company incurs costs while moving inventory, cleaning the stores and returning them to their original condition. Such costs are also immaterial. The fair values of the operating lease assets and property, plant and equipment were determined based on estimated future discounted cash flows for such assets using market participant assumptions, including data on the ability to sub-lease the stores. The charge for inventory reserves is related to inventory that is disposed of following the closures of the stores and inventory that is sold below cost prior to such closures. The charge for inventory reserves was recorded in cost of sales in the Company’s statement of operations and comprehensive loss. The other charges were recorded in Store impairment and restructuring charges in the Company’s statement of operations and comprehensive loss. The Company cannot guarantee that it will be able to achieve the anticipated benefits from the store optimization program. If the Company is unable to achieve such benefits, its results of operations and financial condition could be affected. |
Goodwill, Intangibles and Long-
Goodwill, Intangibles and Long-Lived Assets Impairment | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill Intangibles And Long Lived Assets Impairment [Abstract] | |
Goodwill, Intangibles and Long-Lived Assets Impairment | Note 4 – Goodwill, Intangibles and Long-Lived Assets Impairment The Company reviews goodwill and other intangibles that have indefinite lives for impairment annually as of October 1 or when events or changes in circumstances indicate the carrying value of these assets might exceed their current fair values. Impairment testing is based upon the best information available including estimates of fair value which incorporate assumptions marketplace participants would use in making their estimates of fair value. Significant assumptions and estimates are required, including, but not limited to, projecting future cash flows, determining appropriate discount rates and terminal growth rates, and other assumptions, to estimate the fair value of goodwill and indefinite lived intangible assets. Although the Company believes the assumptions and estimates made are reasonable and appropriate, different assumptions and estimates could materially impact its reported financial results. During the three months ended March 31, 2020, the Company identified intangible assets’ impairment indicators associated with its market capitalization and significantly reduced customer demand for its products due to COVID-19. As a result, the Company performed interim impairment tests on the goodwill at its retail and wholesale reporting units and its other indefinite lived intangible assets as of March 31, 2020. The interim impairment tests were performed using an income approach. The Company recognized non-cash pre-tax goodwill impairment charges at March 31, 2020 of $253,110 and $148,326 against the goodwill associated with its retail and wholesale reporting units, respectively. In addition, during the three months ended March 31, 2020, the Company recorded an impairment charge of $131,287 and $3,925 on its Party City and Halloween City tradenames, respectively. During 2019, there was no impairment on the Party City trade name and the Company recorded a Halloween City trade name impairment charge of $6,575. During the three months ended September 30, 2019, the Company identified an impairment indicator associated with its market capitalization and performed interim impairment tests on the goodwill at its retail and wholesale reporting units and its other indefinite lived intangible assets as of September 30, 2019. The interim impairment tests were performed using a combination of a market approach and an income approach. As a result of a sustained decline in the Company’s market capitalization, the Company recognized non-cash pre-tax goodwill impairment charges at September 30, 2019 of $224,100 and $35,000 against the goodwill associated with its retail and wholesale reporting units, respectively. During the three months ended September 30, 2020 the Company has determined that the fair value of certain indefinite-lived intangible assets is lower than the related book values. Additionally, for certain long-lived assets it is more likely than not that those long-lived assets will be disposed significantly before the end of their previously estimated useful lives. As a result, impairment charges of $11,032, $2,423 and $31,277 were recorded in the third quarter on its business indefinite-lived trade name intangibles, finite-lived intangibles and tangible assets, respectively. |
Sale_Leaseback Transaction
Sale/Leaseback Transaction | 9 Months Ended |
Sep. 30, 2020 | |
Sales Leaseback Transaction Disclosure [Abstract] | |
Sale/Leaseback Transaction | Note 5 – Sale/Leaseback Transaction In June 2019, the Company sold its main distribution center in Chester, New York, its metallic balloons manufacturing facility in Eden Prairie, Minnesota, and its injection molded plastics manufacturing facility in Los Lunas, New Mexico. Simultaneously, the Company entered into twenty-year leases for each of the facilities. The aggregate sale price was $128,000 and, during the year ended December 31, 2019, the Company recorded a $58,381 gain on the sale, net of transaction costs, in the Company’s condensed consolidated statement of operations and comprehensive loss. Under the terms of the lease agreements, the Company pays total rent of $8,320 during the first year and the annual rent will increase by 2% thereafter. The Chester and Eden Prairie leases are being accounted for as operating leases and the sale of such properties resulted in the gain above. However, for the Los Lunas property, the present value of the lease payments is greater than substantially all of the fair value of the assets. Therefore, the lease is a finance lease and sale accounting treatment is prohibited. As such, the Company is accounting for the proceeds as a financing lease. As of September 30, 2020 and December 31, 2019 $11,846 and $11,990 is recorded as a part of a Finance lease, respectively. In conjunction with the sale/leaseback transaction, the Company amended its Term Loan Credit Agreement. The amendment required the Company to use half of the proceeds from the transaction, net of costs, to paydown part of the outstanding balance under such debt agreement. Additionally, the amendment required the Company to pay an immaterial “consent fee” to the lenders. As the Term Loan Credit Agreement is a loan syndication, the Company assessed, on a creditor-by-creditor basis, whether the amendment should be accounted for as an extinguishment or a modification. The Company concluded that, for each creditor, the amendment should be accounted for as a modification. Therefore, no capitalized deferred financing costs or original issuance discounts were written off in conjunction with the amendment. During June 2019, the Company used proceeds from the sale (net of costs) described in this Note 5 – Sale/Leaseback |
Disposition of Assets
Disposition of Assets | 9 Months Ended |
Sep. 30, 2020 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Disposition of Assets | Note 6 – Disposition of Assets On October 1, 2019, the Company sold its Canadian-based Party City stores to a Canadian-based retailer for $131,711 and entered into a 10-year supply agreement under which the acquirer agreed to purchase product from the Company for such Party City stores, as well as acquirer’s other stores. On September 30, 2020, PCHI prepaid approximately $17,500 of the term loans outstanding under the Term Loan Credit Agreement. PCHI was required to make such prepayment in accordance with the terms of the Term Loan Credit Agreement in connection with the Company’s sale of its Canadian-based Party City stores. Consistent with the terms of Term Loan Credit Agreement, PCHI reinvested such proceeds in assets used or useful in the business of PCHI and its subsidiaries and entered into binding commitments to reinvest a certain portion of such proceeds by March 30, 2021, such that the total amount of the sale proceeds so reinvested or committed to be reinvested is approximately $97,000 (of which approximately $84,800 was invested or is committed to be reinvested towards capital expenditures and $12,200 was invested or is committed to be reinvested towards permitted acquisitions). Under the Term Loan Credit Agreement, PCHI was permitted to deduct $15,000 on account of a single asset sale transaction prior to prepaying any term loans from net cash proceeds of an asset sale. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Note 7 – Inventories Inventories consisted of the following: September 30, 2020 December 31, 2019 Finished goods $ 581,735 $ 606,036 Raw materials 28,640 34,259 Work in process 19,982 18,124 $ 630,357 $ 658,419 Inventories are valued at the lower of cost or net realizable value. The Company principally determines the cost of inventory using the weighted average method. The Company estimates retail inventory shrinkage for the period between physical inventory dates on a store-by-store basis. Inventory shrinkage estimates can be affected by changes in merchandise mix and changes in actual shortage trends. The shrinkage rate from the most recent physical inventory, in combination with historical experience, is the basis for estimating shrinkage. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8 – Income Taxes On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act (“the CARES Act”) was signed into law. The CARES Act is a $2 trillion legislative package intended to provide economic relief to companies impacted by the COVID-19 pandemic, and it enacted a number of Internal Revenue Code modifications which are of particular benefit to the Company, including: 5-year net operating loss carryback, temporary relaxation of the limitations on interest deductions, qualified improvement property eligible for bonus depreciation, employee retention tax credits, and deferral of payment of payroll tax. The effective income tax rate for the nine months ended September 30, 2020 of 22.9% is different from the statutory rate of 21.0% primarily due to the non-deductible portions of goodwill impairment charges (see Note 4 – Goodwill, Intangibles and Long-Lived Assets Impairment above for further discussion), |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Loss | Note 9 – Changes in Accumulated Other Comprehensive Loss The changes in accumulated other comprehensive loss consisted of the following: Three Months Ended September 30, 2020 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at June 30, 2020 $ (45,621 ) $ 1,772 $ (43,849 ) Other comprehensive (loss) income before reclassifications, net of tax 5,076 (321 ) 4,755 Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax — 187 187 Net current-period other comprehensive income 5,076 (134 ) 4,942 Balance at September 30, 2020 $ (40,545 ) $ 1,638 $ (38,907 ) Three Months Ended September 30, 2019 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at June 30, 2019 $ (45,344 ) $ 128 $ (45,216 ) Other comprehensive (loss) income before reclassifications (6,920 ) 166 (6,754 ) Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax — (73 ) (73 ) Net current-period other comprehensive income (loss) (6,920 ) 93 (6,827 ) Balance at September 30, 2019 $ (52,264 ) $ 221 $ (52,043 ) Nine Months Ended September 30, 2020 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at December 31, 2019 $ (37,434 ) $ 1,700 $ (35,734 ) Other comprehensive (loss) before reclassifications, net of tax (3,111 ) (251 ) (3,362 ) Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax — 189 189 Net current-period other comprehensive (loss) income (3,111 ) (62 ) (3,173 ) Balance at September 30, 2020 $ (40,545 ) $ 1,638 $ (38,907 ) Nine Months Ended September 30, 2019 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at December 31, 2018 $ (50,056 ) $ 855 $ (49,201 ) Other comprehensive (loss) income before reclassifications, net of income tax (2,208 ) 226 (1,982 ) Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive income, net of income tax — (860 ) (860 ) Net current-period other comprehensive income (loss) (2,208 ) (634 ) (2,842 ) Balance at September 30, 2019 $ (52,264 ) $ 221 $ (52,043 ) |
Capital Stock
Capital Stock | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Capital Stock | Note 10 – Capital Stock At September 30, 2020, the Company’s authorized capital stock consisted of 300,000,000 shares of $0.01 par value common stock and 15,000,000 shares of $0.01 par value preferred stock. During 2013, Party City Holdco granted performance-based stock options to key employees and independent directors. For those performance-based options, vesting was contingent on Thomas H. Lee Partners, L.P. (“THL”) achieving specified investment returns when it sold its entire ownership stake in Party City Holdco. In June 2020, THL distributed its remaining shares. At the time of the THL distribution, there were 2,539,600 performance options outstanding with an average grant date fair value of $3.09. None of the performance-based options vested as the specified investment returns were not attained. The Company recorded compensation expense of $7,847 for the nine months ended September 30, 2020. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Note 11 – Segment Information Industry Segments The Company has two identifiable business segments. The Wholesale segment designs, manufactures, sources and distributes decorated party goods, including paper and plastic tableware, metallic and latex balloons, Halloween and other costumes, accessories, novelties, gifts and stationery throughout the world. The Retail segment operates specialty retail party supply stores in the United States, principally under the names Party City and Halloween City, and it operates e-commerce websites, principally through the domain name Partycity.com. The Retail segment also franchises both individual stores and franchise areas throughout the United States, Mexico and Puerto Rico, principally under the name Party City. The Company’s industry segment data for the three months ended September 30, 2020 and September 30, 2019 was as follows: Wholesale Retail Consolidated Three Months Ended September 30, 2020 Revenues: Net sales $ 346,621 $ 364,481 $ 711,102 Royalties and franchise fees — 1,722 1,722 Total revenues 346,621 366,203 712,824 Eliminations (179,049 ) — (179,049 ) Net revenues $ 167,572 $ 366,203 $ 533,775 Loss from operations $ (12,738 ) $ (14,361 ) $ (27,099 ) Interest expense, net 13,422 Other expense, net (2,873 ) Gain on debt refinancing (273,149 ) Income before income taxes $ 235,501 Wholesale Retail Consolidated Three Months Ended September 30, 2019 Revenues: Net sales $ 383,425 $ 369,467 $ 752,892 Royalties and franchise fees — 1,886 1,886 Total revenues 383,425 371,353 754,778 Eliminations (214,547 ) — (214,547 ) Net revenues $ 168,878 $ 371,353 $ 540,231 Loss from operations $ (32,424 ) $ (245,102 ) $ (277,526 ) Interest expense, net 29,424 Other expense, net 2,047 Loss before income taxes $ (308,997 ) The Company’s industry segment data for the nine months ended September 30, 2020 and 2019 was as follows: Wholesale Retail Consolidated Nine Months Ended September 30, 2020 Revenues: Net sales $ 692,715 $ 850,612 $ 1,543,327 Royalties and franchise fees — 4,349 4,349 Total revenues 692,715 854,961 1,547,676 Eliminations (345,167 ) — (345,167 ) Net revenues $ 347,548 $ 854,961 $ 1,202,509 Loss from operations $ (232,178 ) $ (533,085 ) $ (765,263 ) Interest expense, net 63,954 Other expense, net 4,287 Gain on debt refinancing (273,149 ) Loss before income taxes $ (560,355 ) Wholesale Retail Consolidated Nine Months Ended September 30, 2019 Revenues: Net sales $ 962,793 $ 1,170,777 $ 2,133,570 Royalties and franchise fees — 6,089 6,089 Total revenues 962,793 1,176,866 2,139,659 Eliminations (522,421 ) — (522,421 ) Net revenues $ 440,372 $ 1,176,866 $ 1,617,238 Income (loss) from operations $ 30,096 $ (220,434 ) $ (190,338 ) Interest expense, net 88,857 Other expense, net 6,643 Loss before income taxes $ (285,838 ) In 2019, the Company initiated a store optimization program under which the Company identified approximately 55 Party City stores to be closed. In addition, 21 stores were identified for closure in the first quarter of 2020 were closed in the third quarter. In conjunction with the program, during the three months ended September 30, 2020 and 2019 the Company’s Retail segment recorded $3,110 and $2,574 of store impairment and restructuring charges, respectively. In conjunction with the program, during the nine months ended September 30, 2020 and 2019 the Company’s Retail segment recorded $33,698 and $47,102 of store impairment and restructuring charges, respectively. See Note 3 – Store Impairment and Restructuring Charges for further detail. During June 2019, the Company’s Wholesale segment sold its main distribution center in Chester, New York, its metallic balloons manufacturing facility in Eden Prairie, Minnesota and its injection molded plastics manufacturing facility in Los Lunas, New Mexico. The aggregate sale price was $128,000 and, during the three months ended June 30, 2019, the Company’s Wholesale segment recorded a $58,381 gain on the sale in the Company’s condensed consolidated statement of operations and comprehensive income. See Note 5 – Sale/Leaseback Transaction for further detail. During the three months ended March 31, 2020, the Company identified intangible assets’ impairment indicators associated with its market capitalization and significantly reduced customer demand for its products due to COVID-19. As a result, the Company performed interim impairment tests on the goodwill at its retail and wholesale reporting units and its other indefinite lived intangible assets as of March 31, 2020. As a result, the Company recognized non-cash pre-tax goodwill and trade name impairment charges. See Note 4 – Goodwill, Intangibles and Long-Lived Assets Impairment for further detail. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 12 – Commitments and Contingencies The Company is a party to certain claims and litigation in the ordinary course of business. The Company does not believe these proceedings will result, individually or in the aggregate, in a material adverse effect on its financial condition or future results of operations. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Note 13 – Derivative Financial Instruments The Company is directly and indirectly affected by changes in certain market conditions. These changes in market conditions may adversely impact the Company’s financial performance and are referred to as market risks. The Company, when deemed appropriate, uses derivatives as a risk management tool to mitigate the potential impact of certain market risks. The primary market risks managed through the use of derivative financial instruments are interest rate risk and foreign currency exchange rate risk. Foreign Exchange Risk Management A portion of the Company’s cash flows are derived from transactions denominated in foreign currencies. In order to reduce the uncertainty of foreign exchange rate movements on transactions denominated in foreign currencies, including the British Pound Sterling, the Canadian Dollar, the Euro, the Malaysian Ringgit, the Australian Dollar, and the Mexican Peso, the Company enters into foreign exchange contracts with major international financial institutions. These forward contracts, which typically mature within one year, are designed to hedge anticipated foreign currency transactions, primarily inventory purchases and sales. For contracts that qualify for hedge accounting, the terms of the foreign exchange contracts are such that cash flows from the contracts should be highly effective in offsetting the expected cash flows from the underlying forecasted transactions. The foreign currency exchange contracts are reflected in the condensed consolidated balance sheets at fair value. At September 30, 2020 and December 31, 2019, the Company had foreign currency exchange contracts that qualified for hedge accounting. No components of these agreements were excluded in the measurement of hedge effectiveness. As these hedges are 100% effective, there is no current impact on earnings due to hedge ineffectiveness. The Company anticipates that substantially all unrealized gains and losses in accumulated other comprehensive loss related to these foreign currency exchange contracts will be reclassified into earnings at a later date. The following table displays the fair values of the Company’s derivatives at September 30, 2020 and December 31, 2019: Derivative Assets Derivative Liabilities September 30, 2020 December 31, 2019 September 30, 2020 December 31, 2019 Balance Sheet Line Fair Value Balance Sheet Line Fair Value Balance Sheet Line Fair Value Balance Sheet Line Fair Value Foreign Exchange Contracts (a) PP $ 131 (a) PP $ — (b) AE $ 30 (b) AE $ — (a) PP = Prepaid expenses and other current assets (b) AE = Accrued expenses The following table displays the notional amounts of the Company’s derivatives at September 30, 2020 and December 31, 2019: Derivative Instrument September 30, 2020 December 31, 2019 Foreign Exchange Contracts $ 6,449 $ 300 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 14 – Fair Value Measurements The provisions of ASC Topic 820, “Fair Value Measurement”, define fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. During 2017, the Company acquired a 28% ownership interest in Punchbowl, Inc. (“Punchbowl”), a provider of digital greeting cards and digital invitations. At such time, the Company provided Punchbowl’s other investors with the ability to “put” their interest in Punchbowl to the Company at a future date. Additionally, at such time, the Company received the ability to “call” the interest of the other investors. During the twelve months ended December 31, 2019, the option was terminated and the Company wrote off its asset related to the call option and reversed its liability related to the put option. Prior to such time, the Company had been adjusting the put liability to fair value on a recurring basis. The liability represented a Level 3 fair value measurement as it was based on unobservable inputs. In November 2019, the Company sold its ownership interest in Punchbowl, and recorded a net charge of $2,169 in other expenses, net for the option termination and the sale of its ownership interest. During 2017, the Company and Ampology, a subsidiary of Trivergence, reached an agreement to form a new legal entity, Kazzam, LLC (“Kazzam”), for the purpose of designing, developing and launching an online exchange platform for party-related services. As part of Ampology’s compensation for designing, developing and launching the exchange platform, Ampology received an ownership interest in Kazzam. The interest had been recorded as redeemable securities in the mezzanine of the Company’s consolidated balance sheet as Ampology had the right to cause the Company to purchase the interest. The liability was adjusted to the greater of the current fair value or the original fair value at the time at which the ownership interest was issued (adjusted for any subsequent changes in the ownership interest percentage). The majority of the Company’s non-financial instruments, which include goodwill, intangible assets, lease assets, inventories and property, plant and equipment, are not required to be carried at fair value on a recurring basis. However, if certain triggering events occur (or at least annually for goodwill and indefinite-lived intangible assets), a non-financial instrument is required to be evaluated for impairment. If the Company determines that the non-financial instrument is impaired, the Company would be required to write down the non-financial instrument to its fair value. See Note 3 – Store Impairment and Restructuring Charges and Note 4 – Goodwill, Intangibles and Long-Lived Assets Impairment for further detail. The carrying amounts for cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses and other current liabilities approximated fair value at September 30, 2020 because of the short-term maturities of the instruments and/or their variable rates of interest. The carrying amounts and fair values of borrowings under the Term Loan Credit Agreement and the Company’s senior notes as of September 30, 2020 are as follows: September 30, 2020 Carrying Amount Fair Value Term Loan Credit Agreement $ 693,906 $ 569,034 6.125% Senior Notes – due 2023 22,765 8,253 6.625% Senior Notes – due 2026 106,273 23,730 First Lien Party City Notes 207,925 155,153 First Lien Anagram Notes 150,958 158,056 Second Lien Anagram Notes 152,104 120,162 The fair values represent Level 2 fair value measurements as the debt instruments trade in inactive markets. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 15 – Earnings Per Share Basic earnings per share are computed by dividing net income attributable to common shareholders of Party City Holdco Inc. by the weighted average number of common shares outstanding for the period. Diluted earnings per share are calculated based on the weighted average number of outstanding common shares plus the dilutive effect of stock options and warrants, as if they were exercised, and restricted stock units, as if they vested. Basic and diluted loss per share is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net (loss) income attributable to common shareholders of Party City Holdco Inc. $ 239,707 $ (281,533 ) $ (431,821 ) $ (263,677 ) Weighted average shares - Basic 106,709,307 93,346,448 97,872,174 93,271,392 Effect of dilutive securities: Warrants — — — — Restricted stock units 166,324 — — — Stock options — — — — Weighted average shares - Diluted 106,875,631 93,346,448 97,872,174 93,271,392 Net (loss) income per share attributable to common shareholders of Party City Holdco Inc. - Basic $ 2.25 $ (3.02 ) $ (4.41 ) $ (2.83 ) Net (loss) income per share attributable to common shareholders of Party City Holdco Inc. - Diluted $ 2.24 $ (3.02 ) $ (4.41 ) $ (2.83 ) During the three months ended September 30, 2020, 3,475,621 stock options, 1,000,000 warrants and 263,727 restricted stock units were excluded from the calculation of net loss per share attributable to common shareholders of Party City Holdco Inc. – diluted as they were anti-dilutive. During the nine months ended September 30, 2020, 3,475,621 stock options, 1,000,000 warrants and 584,258 restricted stock units were excluded from the calculation of net loss per share attributable to common shareholders of Party City Holdco Inc. – diluted as they were anti-dilutive. During the three and nine months ended September 30, 2019, 3,544,501 stock options, |
Current and Long-Term Obligatio
Current and Long-Term Obligations | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Current and Long-Term Obligations | Note 16 – Current and Long-Term Obligations Long-term obligations at September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2019 Term Loan Credit Agreement $ 693,906 $ 718,596 6.125% 22,765 347,015 6.625% 106,273 494,910 First Lien Party City Notes 207,925 — First Lien Anagram Notes 150,958 — Second Lien Anagram Notes 152,104 — Finance lease obligations 14,749 14,990 Total long-term obligations 1,348,680 1,575,511 Less: current portion (14,342 ) (71,524 ) Long-term obligations, excluding current portion $ 1,334,338 $ 1,503,987 Prior to April 2019, the Company had a $540,000 asset-based revolving credit facility (with a seasonal increase to $640,000 during a certain period of each calendar year) (the “ABL Facility”), which matures during August 2023 (subject to a springing maturity at an earlier date if the maturity date of certain of the Company’s other debt has not been extended or refinanced). It provides for (a) revolving loans, subject to a borrowing base, and (b) letters of credit, in an aggregate face amount at any time outstanding not to exceed $50,000. During April 2019, the Company amended the ABL Facility. Such amendment removed the seasonal component and made the ABL Facility a $640,000 facility with no seasonal modification component. In connection with the refinancing transactions as follows, PCHI (1) reduced the ABL revolving commitments and prepaid the outstanding ABL revolving loans, in each case, in an aggregate principal amount equal to $44,000 in accordance with the ABL Facility credit agreement, and (2) designated Anagram Holdings and each of its subsidiaries as an unrestricted subsidiary under the ABL Facility and the Term Loan Credit Agreement. In the first nine months of 2020 the Company drew down $269.8 million under the ABL Facility. At September 30, 2020, $100.1 million was invested in US Treasury funds with maturities of less than three months. The Company had approximately $178.5 million of availability under the ABL Facility as of September 30, 2020. Completion of Refinancing Transactions On July 30, 2020 (the “Settlement Date”), the Company and certain of its direct or indirect subsidiaries, including PCHI, Anagram Holdings, LLC, a Delaware limited liability company and wholly owned direct subsidiary of PCHI (“Anagram Holdings”), and Anagram International, Inc., a Minnesota corporation and wholly owned direct subsidiary of Anagram Holdings, completed certain refinancing transactions, including, among other things: (i) the exchange of $327,076 of 6.125% Senior Notes due 2023 (the “2023 Notes”) and $392,746 of 6.625% Senior Notes due 2026 (the “2026 Notes” and, together with the 2023 Notes, the “Existing Notes”) issued by PCHI, in each case tendered in the Company’s offers to exchange pursuant to the terms described in a confidential offering memorandum, for (A) $156,669 of Senior Secured First Lien Floating Rate Notes due 2025 (the “First Lien Party City Notes”) issued by PCHI; (B) $84,687 of 10.00% PIK/Cash Senior Secured Second Lien Notes due 2026 (the “Second Lien Anagram Notes”) issued by Anagram Holdings and Anagram International (together, the “Anagram Issuers”); and (C) 15,942,551 shares of the Company’s common stock, $0.01 par value per share (the “Common Stock”); (ii) the issuance of $110,000 in the aggregate of 15.00% PIK/Cash Senior Secured First Lien Notes due 2025 (the “First Lien Anagram Notes”) by the Anagram Issuers and an additional $5,000 of First Lien Party City Notes in connection with a rights offering and a private placement, as applicable; and (iii) the solicitations of certain consents with respect to the indentures governing Existing Notes. The First Lien Party City Notes were issued pursuant to an indenture, dated as of the Settlement Date, among PCHI, as issuer, certain guarantors party thereto (the “Party City Guarantors”) and Ankura Trust Company, LLC (“Ankura”), as trustee and collateral trustee. The First Lien Party City Notes were issued in an aggregate amount of $161,669 and will mature on July 15, 2025. Interest on the First Lien Party City Notes accrues from the Settlement Date at a floating rate equal to the 6-month London Inter-Bank Offered Rate plus 500 basis points (with a floor of 75 basis points) per annum, payable semi-annually in arrears on January 15 and July 15 of each year, commencing January 15, 2021. The First Lien Party City Notes are senior secured obligations of PCHI and the Party City Guarantors. The First Lien Party City Notes are pari passu in right of payment with all of PCHI’ other senior indebtedness, including the existing senior secured term loan facility and the ABL Facility, and are structurally subordinated to the First Lien Anagram Notes and the Second Lien Anagram Notes, to the extent of the value of the Anagram Collateral (as defined below). The First Lien Party City Notes are secured by a first priority lien on collateral that includes liens on substantially all assets (other than certain accounts, inventory, deposit accounts, securities accounts, related assets and general intangibles) of the Party City Guarantors, in each case subject to certain exceptions and permitted liens. The First Lien Anagram Notes were issued pursuant to an indenture, dated as of the Settlement Date, among Anagram Holdings, as issuer, Anagram International, as co-issuer, certain guarantors party thereto (the “Anagram Guarantors”) and Ankura, as trustee and collateral trustee. The First Lien Anagram Notes were issued in an aggregate amount of $110,000 and will mature on August 15, 2025. Interest on the First Lien Anagram Notes accrues from the Settlement Date at (i) a rate of 10.00% per annum, payable in cash; and (ii) a rate of 5.00% per annum payable by increasing the principal amount of the outstanding First Lien Anagram Notes or issuing additional First Lien Anagram Notes, as the case may be, in each case payable semi-annually in arrears on February 15 and August 15 of each year, commencing February 15, 2021. The First Lien Anagram Notes are senior secured obligations of the Anagram Issuers and are pari passu in right of payment with all of the Anagram Issuers’ other senior indebtedness. The First Lien Anagram Notes are secured by a first priority lien on collateral that consists of substantially all assets and properties of the Anagram Issuers and the Anagram Guarantors, subject to certain exceptions and permitted liens (the “Anagram Collateral”). Such security interests are senior in priority to the security interests in such assets that secure the Second Lien Anagram Notes. The Second Lien Anagram Notes were issued pursuant to an indenture, dated as of the Settlement Date, among Anagram Holdings, as issuer, Anagram International, as co-issuer, the Anagram Guarantors and Ankura, as trustee and collateral trustee. The Second Lien Anagram Notes were issued in an aggregate amount of $84,687 and will mature on August 15, 2026. Interest on the Second Lien Anagram Notes accrues from the Settlement Date at (i) a rate of 5.00% per annum, payable, at the Anagram Issuers’ option, entirely in cash or entirely by increasing the principal amount of the outstanding Second Lien Anagram Notes or issuing additional Second Lien Anagram Notes, as the case may be; and (ii) a rate of 5.00% per annum payable by increasing the principal amount of the outstanding Second Lien Anagram Notes or issuing additional Second Lien Anagram Notes, as the case may be, in each case payable semi-annually in arrears on February 15 and August 15 of each year, commencing February 15, 2021; provided however The Company evaluated the refinancing transaction in accordance with ASC 470-60 Troubled Debt Restructuring. The exchange of the 2023 Notes and 2026 Notes for the First Lien Party City Notes, Second Lien Anagram Notes and shares of Company Common Stock, as well as the concurrent purchase by the participants in the exchange of First Lien Anagram Notes represents a troubled debt restructuring (“TDR”). As the future undiscounted cash flows of the restructured debt were less than the net carrying value of the Existing Notes (including accrued interest and unamortized discount) adjusted for Common Stock issued to the participants in the exchange and such participants’ purchase of and lenders’ participation in the First Lien Anagram Notes, the Company recognized a gain of $273,149 which reflects $18,902 of third-party fees incurred, and $27,007 of Common Stock issued in the exchange. The Company received $39,544 of cash from the participants in the exchange related to $44,500 of principal amount of First Lien Anagram Notes with an undiscounted value of $82,160, which includes interest expense. Interest expense is not currently recognized for this portion of the restructured debt. Another portion of the restructured debt related to one holder of Existing Notes did not result in gain recognition as the undiscounted cash flows of the restructured debt was higher than the carrying value of the existing debt. The carrying amount of this portion of the restructured debt is $32,328 and the interest expense will be recognized prospectively at a 3.5% effective interest rate. Amounts attributed to purchasers of the First Lien Anagram Notes who were not participants in the exchange (principal balance of $50,500) are recognized at consideration received less allocated transaction costs (netting to $45,678) and the effective interest method will be used to recognize interest expense prospectively. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 30, 2020 | |
Revenue From Contract With Customer [Abstract] | |
Revenue from Contracts with Customers | Note 17 – Revenue from Contracts with Customers The following table summarizes revenue from contracts with customers for the three and nine months ended September 30, 2020 and 2019: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Retail Net Sales: North American Party City Stores $ 358,246 $ 363,633 $ 829,281 $ 1,164,253 Other 6,235 5,834 21,331 6,524 Total Retail Net Sales $ 364,481 $ 369,467 $ 850,612 $ 1,170,777 Royalties and Franchise Fees 1,722 1,886 4,349 6,089 Total Retail Revenue $ 366,203 $ 371,353 $ 854,961 $ 1,176,866 Wholesale Net Sales: Domestic $ 79,388 $ 82,670 $ 177,263 $ 231,257 International 88,184 86,208 170,285 209,115 Total Wholesale Net Sales $ 167,572 $ 168,878 $ 347,548 $ 440,372 Total Consolidated Revenue $ 533,775 $ 540,231 $ 1,202,509 $ 1,617,238 |
Cash, Cash Equivalents and Rest
Cash, Cash Equivalents and Restricted Cash | 9 Months Ended |
Sep. 30, 2020 | |
Text Block [Abstract] | |
Cash, Cash Equivalents and Restricted Cash | Note 18 – Cash, Cash Equivalents and Restricted Cash The Company’s September 30, 2020 consolidated balance sheet included $170,562 of cash and cash equivalents (with maturities of less than three months) and $125 of restricted cash. The Company’s December 31, 2019 consolidated balance sheet included $34,917 of cash and cash equivalents and $259 of restricted cash. Restricted cash is recorded in Prepaid expenses and other current assets. |
Kazzam, LLC
Kazzam, LLC | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Kazzam, LLC | Note 19 – Kazzam, LLC During the first quarter of 2017, the Company and Ampology, a subsidiary of Trivergence, reached an agreement to form a new legal entity, Kazzam, LLC (“Kazzam”), for the purpose of designing, developing and launching an online exchange platform for party-related services. At December 31, 2019, although the Company owned 26% of Kazzam’s equity, Kazzam was a variable interest entity and the Company consolidated Kazzam into the Company’s financial statements. Further, the Company was funding all of Kazzam’s start-up activities via a loan to Kazzam and recorded its operating results in “development stage expenses” in the Company’s consolidated statement of operations and comprehensive (loss) income. Ampology’s ownership interest in Kazzam had been recorded in redeemable securities in the mezzanine of the Company’s consolidated balance sheet. In January 2020, the Company and Ampology terminated certain services agreements and warrants that Ampology had in the Company stock. The parties concurrently entered into an interim transition agreement for which expenses are recorded as development stage expenses. On March 23, 2020, the Company agreed to purchase Ampology’s interest in Kazzam in exchange for a three-year |
Basis of Presentation and Rec_2
Basis of Presentation and Recently Issued Accounting Pronouncements (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Recently Issued and Adopted Accounting Pronouncements | Recently Issued and Adopted Accounting Pronouncements In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-13, “Fair Value Measurement (Topic 820) – Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement”. The new guidance improves and clarifies the fair value measurement disclosure requirements of ASC 820. The new disclosure requirements include the disclosure of the changes in unrealized gains or losses included in other comprehensive (loss) income for recurring Level 3 fair value measurements held at the end of the reporting period and the explicit requirement to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The other provisions of ASU 2018-13 also include eliminated and modified disclosure requirements. The guidance was effective for fiscal years beginning after December 15, 2019. The Company has adopted this guidance effective January 1, 2020, prospectively and the adoption and application of this standard did not have a material impact to the consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, “Compensation — Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting”. The ASU simplifies the accounting for non-employee share-based payments. The Company adopted the update during the first quarter of 2019. The pronouncement requires companies to record the impact of adoption, if any, as a cumulative-effect adjustment to retained earnings as of the adoption date. Therefore, on January 1, 2019, the Company decreased retained earnings by $503. Additionally, the Company increased additional paid-in capital by $662 and recorded a $159 deferred income tax asset. In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities”. The pronouncement amends the existing hedge accounting model in order to enable entities to better portray the economics of their risk management activities in their financial statements. The Company adopted the update during the first quarter of 2019 and such adoption had no impact on the Company’s consolidated financial statements. In January 2017 the FASB issued ASU No. 2017-04, “Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment”, which eliminates the requirement to measure a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under the amendments in ASU 2017-04, an entity will perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity will recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized will not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity will consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. The Company adopted ASU No. 2017-04 during the first quarter of 2019 and such adoption had no impact on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses”. The ASU changes how entities will account for credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The ASU requires that an entity measure and recognize expected credit losses at the time the asset is recorded, while considering a broader range of information to estimate credit losses including macroeconomic conditions that correlate with historical loss experience, delinquency trends and aging behavior of receivables, among others. The Company has adopted this guidance effective January 1, 2020, prospectively, with respect to its receivables, and the adoption and application of this standard did not have a material impact to the consolidated financial statements during the first nine months of 2020. The Company maintains allowances for credit losses resulting from the inability of the Company’s customers to make required payments. Judgment is required in assessing the ultimate realization of these receivables, including consideration of the Company’s history of receivable write-offs, the level of past due accounts and the economic status of the Company’s customers. In an effort to identify adverse trends relative to customer economic status, the Company assesses the financial health of the markets it operates in and performs periodic credit evaluations of its customers and ongoing reviews of account balances and aging of receivables. Amounts are considered past due when payment has not been received within the time frame of the credit terms extended. Write-offs are charged directly against the allowance for credit losses and occur only after all collection efforts have been exhausted. The Company will continue to actively monitor the impact of the COVID-19 pandemic on expected losses. At September 30, 2020 and December 31, 2019, the allowance for credit losses was $9,590 and $4,786, respectively. In February 2016, the FASB issued ASU 2016-02, “Leases”. The ASU requires that companies recognize assets and liabilities for the rights and obligations created by companies’ leases. The Company’s lease portfolio is primarily comprised of store leases, manufacturing and distribution facility leases, warehouse leases and office leases. The Company adopted the new lease standard during the first quarter of 2019 and, to the extent required by the pronouncement, recognized a right of use asset and liability for its operating lease arrangements with terms of greater than twelve months. The pronouncement had no impact on the Company’s consolidated statement of operations and comprehensive loss and it did not impact the Company’s compliance with its debt covenants. Additionally, the standard requires companies to make certain annual disclosures, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. |
Store Impairment and Restruct_2
Store Impairment and Restructuring Charges (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring And Related Activities [Abstract] | |
Store Impairment and Restructuring Charges | In conjunction with the store optimization program and store impairment, during the three and nine months ended September 30, 2020 and 2019, the Company recorded the following charges: Three Months Ended September 30, 2020 2019 Inventory reserves $ 1,184 $ — Operating lease asset impairment 137 — Labor and other costs incurred closing stores 1,789 2,574 Total $ 3,110 $ 2,574 Nine Months Ended September 30, 2020 2019 Inventory reserves $ 12,880 $ 21,285 Operating lease asset impairment 14,530 14,149 Property, plant and equipment impairment 2,065 4,680 Labor and other costs incurred closing stores 4,223 6,327 Severance — 661 Total $ 33,698 $ 47,102 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories consisted of the following: September 30, 2020 December 31, 2019 Finished goods $ 581,735 $ 606,036 Raw materials 28,640 34,259 Work in process 19,982 18,124 $ 630,357 $ 658,419 |
Changes in Accumulated Other _2
Changes in Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Loss | The changes in accumulated other comprehensive loss consisted of the following: Three Months Ended September 30, 2020 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at June 30, 2020 $ (45,621 ) $ 1,772 $ (43,849 ) Other comprehensive (loss) income before reclassifications, net of tax 5,076 (321 ) 4,755 Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax — 187 187 Net current-period other comprehensive income 5,076 (134 ) 4,942 Balance at September 30, 2020 $ (40,545 ) $ 1,638 $ (38,907 ) Three Months Ended September 30, 2019 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at June 30, 2019 $ (45,344 ) $ 128 $ (45,216 ) Other comprehensive (loss) income before reclassifications (6,920 ) 166 (6,754 ) Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax — (73 ) (73 ) Net current-period other comprehensive income (loss) (6,920 ) 93 (6,827 ) Balance at September 30, 2019 $ (52,264 ) $ 221 $ (52,043 ) Nine Months Ended September 30, 2020 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at December 31, 2019 $ (37,434 ) $ 1,700 $ (35,734 ) Other comprehensive (loss) before reclassifications, net of tax (3,111 ) (251 ) (3,362 ) Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax — 189 189 Net current-period other comprehensive (loss) income (3,111 ) (62 ) (3,173 ) Balance at September 30, 2020 $ (40,545 ) $ 1,638 $ (38,907 ) Nine Months Ended September 30, 2019 Foreign Currency Adjustments Impact of Foreign Exchange Contracts, Net of Taxes Total, Net of Taxes Balance at December 31, 2018 $ (50,056 ) $ 855 $ (49,201 ) Other comprehensive (loss) income before reclassifications, net of income tax (2,208 ) 226 (1,982 ) Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive income, net of income tax — (860 ) (860 ) Net current-period other comprehensive income (loss) (2,208 ) (634 ) (2,842 ) Balance at September 30, 2019 $ (52,264 ) $ 221 $ (52,043 ) |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Company's Industry Segment Data | The Company’s industry segment data for the three months ended September 30, 2020 and September 30, 2019 was as follows: Wholesale Retail Consolidated Three Months Ended September 30, 2020 Revenues: Net sales $ 346,621 $ 364,481 $ 711,102 Royalties and franchise fees — 1,722 1,722 Total revenues 346,621 366,203 712,824 Eliminations (179,049 ) — (179,049 ) Net revenues $ 167,572 $ 366,203 $ 533,775 Loss from operations $ (12,738 ) $ (14,361 ) $ (27,099 ) Interest expense, net 13,422 Other expense, net (2,873 ) Gain on debt refinancing (273,149 ) Income before income taxes $ 235,501 Wholesale Retail Consolidated Three Months Ended September 30, 2019 Revenues: Net sales $ 383,425 $ 369,467 $ 752,892 Royalties and franchise fees — 1,886 1,886 Total revenues 383,425 371,353 754,778 Eliminations (214,547 ) — (214,547 ) Net revenues $ 168,878 $ 371,353 $ 540,231 Loss from operations $ (32,424 ) $ (245,102 ) $ (277,526 ) Interest expense, net 29,424 Other expense, net 2,047 Loss before income taxes $ (308,997 ) The Company’s industry segment data for the nine months ended September 30, 2020 and 2019 was as follows: Wholesale Retail Consolidated Nine Months Ended September 30, 2020 Revenues: Net sales $ 692,715 $ 850,612 $ 1,543,327 Royalties and franchise fees — 4,349 4,349 Total revenues 692,715 854,961 1,547,676 Eliminations (345,167 ) — (345,167 ) Net revenues $ 347,548 $ 854,961 $ 1,202,509 Loss from operations $ (232,178 ) $ (533,085 ) $ (765,263 ) Interest expense, net 63,954 Other expense, net 4,287 Gain on debt refinancing (273,149 ) Loss before income taxes $ (560,355 ) Wholesale Retail Consolidated Nine Months Ended September 30, 2019 Revenues: Net sales $ 962,793 $ 1,170,777 $ 2,133,570 Royalties and franchise fees — 6,089 6,089 Total revenues 962,793 1,176,866 2,139,659 Eliminations (522,421 ) — (522,421 ) Net revenues $ 440,372 $ 1,176,866 $ 1,617,238 Income (loss) from operations $ 30,096 $ (220,434 ) $ (190,338 ) Interest expense, net 88,857 Other expense, net 6,643 Loss before income taxes $ (285,838 ) |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Values of Derivatives | The following table displays the fair values of the Company’s derivatives at September 30, 2020 and December 31, 2019: Derivative Assets Derivative Liabilities September 30, 2020 December 31, 2019 September 30, 2020 December 31, 2019 Balance Sheet Line Fair Value Balance Sheet Line Fair Value Balance Sheet Line Fair Value Balance Sheet Line Fair Value Foreign Exchange Contracts (a) PP $ 131 (a) PP $ — (b) AE $ 30 (b) AE $ — (a) PP = Prepaid expenses and other current assets (b) AE = Accrued expenses |
Schedule of Notional Amounts of Derivatives | The following table displays the notional amounts of the Company’s derivatives at September 30, 2020 and December 31, 2019: Derivative Instrument September 30, 2020 December 31, 2019 Foreign Exchange Contracts $ 6,449 $ 300 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary of Carrying Amount and Fair Value | The carrying amounts and fair values of borrowings under the Term Loan Credit Agreement and the Company’s senior notes as of September 30, 2020 are as follows: September 30, 2020 Carrying Amount Fair Value Term Loan Credit Agreement $ 693,906 $ 569,034 6.125% Senior Notes – due 2023 22,765 8,253 6.625% Senior Notes – due 2026 106,273 23,730 First Lien Party City Notes 207,925 155,153 First Lien Anagram Notes 150,958 158,056 Second Lien Anagram Notes 152,104 120,162 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Loss Per Share | Basic and diluted loss per share is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net (loss) income attributable to common shareholders of Party City Holdco Inc. $ 239,707 $ (281,533 ) $ (431,821 ) $ (263,677 ) Weighted average shares - Basic 106,709,307 93,346,448 97,872,174 93,271,392 Effect of dilutive securities: Warrants — — — — Restricted stock units 166,324 — — — Stock options — — — — Weighted average shares - Diluted 106,875,631 93,346,448 97,872,174 93,271,392 Net (loss) income per share attributable to common shareholders of Party City Holdco Inc. - Basic $ 2.25 $ (3.02 ) $ (4.41 ) $ (2.83 ) Net (loss) income per share attributable to common shareholders of Party City Holdco Inc. - Diluted $ 2.24 $ (3.02 ) $ (4.41 ) $ (2.83 ) |
Current and Long-Term Obligat_2
Current and Long-Term Obligations (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Summary of Long-Term Obligations | Long-term obligations at September 30, 2020 and December 31, 2019 consisted of the following: September 30, 2020 December 31, 2019 Term Loan Credit Agreement $ 693,906 $ 718,596 6.125% 22,765 347,015 6.625% 106,273 494,910 First Lien Party City Notes 207,925 — First Lien Anagram Notes 150,958 — Second Lien Anagram Notes 152,104 — Finance lease obligations 14,749 14,990 Total long-term obligations 1,348,680 1,575,511 Less: current portion (14,342 ) (71,524 ) Long-term obligations, excluding current portion $ 1,334,338 $ 1,503,987 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue From Contract With Customer [Abstract] | |
Summary of Revenue from Contracts with Customers | The following table summarizes revenue from contracts with customers for the three and nine months ended September 30, 2020 and 2019: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Retail Net Sales: North American Party City Stores $ 358,246 $ 363,633 $ 829,281 $ 1,164,253 Other 6,235 5,834 21,331 6,524 Total Retail Net Sales $ 364,481 $ 369,467 $ 850,612 $ 1,170,777 Royalties and Franchise Fees 1,722 1,886 4,349 6,089 Total Retail Revenue $ 366,203 $ 371,353 $ 854,961 $ 1,176,866 Wholesale Net Sales: Domestic $ 79,388 $ 82,670 $ 177,263 $ 231,257 International 88,184 86,208 170,285 209,115 Total Wholesale Net Sales $ 167,572 $ 168,878 $ 347,548 $ 440,372 Total Consolidated Revenue $ 533,775 $ 540,231 $ 1,202,509 $ 1,617,238 |
Description of Business- Additi
Description of Business- Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2020Store | |
PC Nextco [Member] | |
Basis Of Presentation [Line Items] | |
Ownership percentage | 100.00% |
PC Intermediate [Member] | |
Basis Of Presentation [Line Items] | |
Ownership percentage | 100.00% |
Party City Holdings Inc [Member] | |
Basis Of Presentation [Line Items] | |
Ownership percentage | 100.00% |
United States and Canada [Member] | |
Basis Of Presentation [Line Items] | |
Number stores | 829 |
Basis of Presentation and Rec_3
Basis of Presentation and Recently Issued Accounting Pronouncements - Additional Information (Detail) - USD ($) $ in Thousands | Jan. 01, 2019 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Significant Accounting Policies [Line Items] | |||||||
Increase (decrease) in retained earnings | $ 136,135 | $ (137,016) | $ 529,721 | $ 782,426 | $ 1,069,087 | $ 1,043,621 | |
Increased Additional Paid In Capital | $ 662 | ||||||
Increased Deferred Income Tax Asset | 159 | ||||||
Allowance for credit losses | 9,590 | 4,786 | |||||
Retained Earnings [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Increase (decrease) in retained earnings | $ (469,040) | $ (708,747) | $ (37,219) | $ 231,597 | $ 513,130 | 495,777 | |
Cumulative Effect of Change in Accounting Principle, Net [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Increase (decrease) in retained earnings | 159 | ||||||
Cumulative Effect of Change in Accounting Principle, Net [Member] | Retained Earnings [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Increase (decrease) in retained earnings | $ (503) | ||||||
ASU 2018-13 [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | ||||||
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2020 | ||||||
ASU 2018-07 [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||||
ASU 2018-07 [Member] | Cumulative Effect of Change in Accounting Principle, Net [Member] | Retained Earnings [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Increase (decrease) in retained earnings | $ (503) | ||||||
ASU 2017-12 [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | ||||||
ASU 2017-04 [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | ||||||
ASU 2016-13 [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | ||||||
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2020 | ||||||
ASU 2016-02 [Member] | |||||||
Significant Accounting Policies [Line Items] | |||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true |
Store Impairment and Restruct_3
Store Impairment and Restructuring Charges - Additional Information (Detail) - Store | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Jan. 31, 2020 | Sep. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | |
Restructuring And Related Activities [Abstract] | ||||
Number of stores identified for closure | 21 | 55 | ||
Number of stores closed | 20 | 21 | 35 |
Store Impairment and Restruct_4
Store Impairment and Restructuring Charges (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Total | $ 3,110 | $ 2,574 | $ 33,698 | $ 47,102 |
Property, plant and equipment impairment | 31,277 | |||
Cost of Sales [Member] | ||||
Inventory reserves | 1,184 | 12,880 | 21,285 | |
Restructuring Charges [Member] | ||||
Operating lease asset impairment | 137 | 14,530 | 14,149 | |
Labor and other costs incurred closing stores | $ 1,789 | $ 2,574 | 4,223 | 6,327 |
Property, plant and equipment impairment | $ 2,065 | 4,680 | ||
Severance | $ 661 |
Goodwill, Intangibles and Lon_2
Goodwill, Intangibles and Long-Lived Assets Impairment - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Impairment charge on intangible asset | $ 2,423,000 | |||
Tangible asset impairment charges | 31,277,000 | |||
Trade Names [Member] | ||||
Impairment of indefinite-lived intangibles | $ 11,032,000 | |||
Party City Holdings Inc [Member] | ||||
Impairment charge on intangible asset | $ 131,287,000 | $ 0 | ||
Halloween City Trade Name [Member] | ||||
Impairment charge on intangible asset | 3,925,000 | $ 6,575,000 | ||
Retail [Member] | Operating Segments [Member] | ||||
Goodwill, impairment loss | 253,110,000 | $ 224,100,000 | ||
Wholesale [Member] | Operating Segments [Member] | ||||
Goodwill, impairment loss | $ 148,326,000 | $ 35,000,000 |
Sale_Leaseback Transaction - Ad
Sale/Leaseback Transaction - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Aggregate sale price | $ 128,000 | $ 128,000 | |||
Gain on the sale net | $ 58,381 | $ 58,381 | $ 58,381 | ||
Lease agreement term | Under the terms of the lease agreements, the Company pays total rent of $8,320 during the first year and the annual rent will increase by 2% thereafter. | ||||
Annual rent increase rate | 2.00% | ||||
Total rent payment | $ 8,320 | ||||
Long-term debt and lease obligations | 1,348,680 | 1,575,511 | |||
Term Loan Credit Agreement [Member] | |||||
Proceeds from the sale (net of costs) | 125,864 | ||||
Repayment of Term debt Loan | $ 62,770 | ||||
Finance Lease Obligations [Member] | |||||
Long-term debt and lease obligations | 14,749 | 14,990 | |||
Los Lunas New Mexico facility financing [Member] | Finance Lease Obligations [Member] | |||||
Long-term debt and lease obligations | $ 11,846 | $ 11,990 |
Disposition of Assets - Additio
Disposition of Assets - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 31, 2021 | Sep. 30, 2020 | Oct. 01, 2019 |
Canadian Based Retailer [Member] | |||
Sale of stores | $ 131,711 | ||
Supply agreement term | 10 years | ||
Party City Holdings Inc [Member] | |||
Prepayment of term loans outstanding | $ 17,500 | ||
Party City Holdings Inc [Member] | Subsequent Event [Member] | |||
Sale proceeds reinvested or committed to be reinvested | $ 97,000 | ||
Sale proceeds reinvested or committed to be reinvested towards capital expenditures | 84,800 | ||
Sale proceeds reinvested or committed to be reinvested towards permitted acquisitions | 12,200 | ||
Amount permitted to deduct on account of single asset sale transaction | $ 15,000 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 581,735 | $ 606,036 |
Raw materials | 28,640 | 34,259 |
Work in process | 19,982 | 18,124 |
Inventories, net | $ 630,357 | $ 658,419 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Trillions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2017 | Mar. 27, 2020 | |
Income Tax Disclosure [Abstract] | |||
CARES Act of 2020 aid | $ 2 | ||
U.S. corporate statutory income tax rate | 21.00% | 35.00% | |
U.S. corporate income tax rate | 22.90% |
Changes in Accumulated Other _3
Changes in Accumulated Other Comprehensive Loss - Changes in Accumulated and Other Comprehensive Loss (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning balance | $ 529,745 | |||
Ending balance | $ 136,399 | 136,399 | ||
Foreign Currency Adjustments [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning balance | (45,621) | $ (45,344) | (37,434) | $ (50,056) |
Other comprehensive (loss) income before reclassifications, net of income tax | 5,076 | (6,920) | (3,111) | (2,208) |
Net current-period other comprehensive income (loss) | 5,076 | (6,920) | (3,111) | (2,208) |
Ending balance | (40,545) | (52,264) | (40,545) | (52,264) |
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning balance | 1,772 | 128 | 1,700 | 855 |
Other comprehensive (loss) income before reclassifications, net of income tax | (321) | 166 | (251) | 226 |
Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax | 187 | (73) | 189 | (860) |
Net current-period other comprehensive income (loss) | (134) | 93 | (62) | (634) |
Ending balance | 1,638 | 221 | 1,638 | 221 |
Accumulated Other Comprehensive Loss [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Beginning balance | (43,849) | (45,216) | (35,734) | (49,201) |
Other comprehensive (loss) income before reclassifications, net of income tax | 4,755 | (6,754) | (3,362) | (1,982) |
Amounts reclassified from accumulated other comprehensive loss to the condensed consolidated statement of operations and comprehensive loss, net of income tax | 187 | (73) | 189 | (860) |
Net current-period other comprehensive income (loss) | 4,942 | (6,827) | (3,173) | (2,842) |
Ending balance | $ (38,907) | $ (52,043) | $ (38,907) | $ (52,043) |
Capital Stock - Additional Info
Capital Stock - Additional Information (Detail) $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($)$ / sharesshares | |
Equity [Abstract] | |
Authorized capital stock | 300,000,000 |
Common stock, par value | $ / shares | $ 0.01 |
Preferred stock, par value | $ / shares | $ 0.01 |
Authorized preferred stock | 15,000,000 |
Performance options outstanding | 2,539,600 |
Average grant date fair value | $ / shares | $ 3.09 |
Performance-based options vested | 0 |
Compensation expense | $ | $ 7,847 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Jan. 31, 2020Store | Sep. 30, 2020USD ($)Store | Mar. 31, 2020Store | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2020USD ($)Segment | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($)Store | |
Segment Reporting [Abstract] | ||||||||
Number of business segments | Segment | 2 | |||||||
Number of stores identified for closure | Store | 21 | 55 | ||||||
Number of stores closed | Store | 20 | 21 | 35 | |||||
Store impairment and restructuring charges | $ 3,110 | $ 2,574 | $ 33,698 | $ 47,102 | ||||
Aggregate sale price | $ 128,000 | |||||||
Gain on the sale net | $ 58,381 | $ 58,381 | $ 58,381 |
Segment Information - Schedule
Segment Information - Schedule of Company's Industry Segment Data (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenues: | ||||
Total revenues | $ 533,775 | $ 540,231 | $ 1,202,509 | $ 1,617,238 |
Income (loss) from operations | (27,099) | (277,526) | (765,263) | (190,338) |
Interest expense, net | 13,422 | 29,424 | 63,954 | 88,857 |
Other (income) expense, net | (2,873) | 2,047 | 4,287 | 6,643 |
(Gain) on debt refinancing | (273,149) | (273,149) | ||
Income (loss) before income taxes | 235,501 | (308,997) | (560,355) | (285,838) |
Operating Segments [Member] | ||||
Revenues: | ||||
Total revenues | 712,824 | 754,778 | 1,547,676 | 2,139,659 |
Eliminations [Member] | ||||
Revenues: | ||||
Total revenues | (179,049) | (214,547) | (345,167) | (522,421) |
Net Sales [Member] | ||||
Revenues: | ||||
Revenues | 532,053 | 538,345 | 1,198,160 | 1,611,149 |
Net Sales [Member] | Operating Segments [Member] | ||||
Revenues: | ||||
Revenues | 711,102 | 752,892 | 1,543,327 | 2,133,570 |
Royalties and Franchise Fees [Member] | ||||
Revenues: | ||||
Revenues | 1,722 | 1,886 | 4,349 | 6,089 |
Royalties and Franchise Fees [Member] | Operating Segments [Member] | ||||
Revenues: | ||||
Revenues | 1,722 | 1,886 | 4,349 | 6,089 |
Wholesale [Member] | ||||
Revenues: | ||||
Total revenues | 167,572 | 168,878 | 347,548 | 440,372 |
Income (loss) from operations | (12,738) | (32,424) | (232,178) | 30,096 |
Wholesale [Member] | Operating Segments [Member] | ||||
Revenues: | ||||
Total revenues | 346,621 | 383,425 | 692,715 | 962,793 |
Wholesale [Member] | Eliminations [Member] | ||||
Revenues: | ||||
Total revenues | (179,049) | (214,547) | (345,167) | (522,421) |
Wholesale [Member] | Net Sales [Member] | Operating Segments [Member] | ||||
Revenues: | ||||
Revenues | 346,621 | 383,425 | 692,715 | 962,793 |
Retail [Member] | ||||
Revenues: | ||||
Total revenues | 366,203 | 371,353 | 854,961 | 1,176,866 |
Income (loss) from operations | (14,361) | (245,102) | (533,085) | (220,434) |
Retail [Member] | Operating Segments [Member] | ||||
Revenues: | ||||
Total revenues | 366,203 | 371,353 | 854,961 | 1,176,866 |
Retail [Member] | Net Sales [Member] | Operating Segments [Member] | ||||
Revenues: | ||||
Revenues | 364,481 | 369,467 | 850,612 | 1,170,777 |
Retail [Member] | Royalties and Franchise Fees [Member] | Operating Segments [Member] | ||||
Revenues: | ||||
Revenues | $ 1,722 | $ 1,886 | $ 4,349 | $ 6,089 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Additional Information (Detail) - Foreign Exchange Risk Management [Member] | 9 Months Ended |
Sep. 30, 2020 | |
Derivative [Line Items] | |
Hedging effectiveness | 100.00% |
Maximum [Member] | |
Derivative [Line Items] | |
Foreign exchange forward contracts maturity | 1 year |
Derivative Financial Instrume_4
Derivative Financial Instruments - Schedule of Fair Values of Derivatives (Detail) - Foreign Exchange Contracts [Member] $ in Thousands | Sep. 30, 2020USD ($) |
Prepaid Expenses and Other Current Assets [Member] | |
Derivatives Fair Value [Line Items] | |
Derivative Assets | $ 131 |
Accrued Expenses [Member] | |
Derivatives Fair Value [Line Items] | |
Derivative Liabilities | $ 30 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Schedule of Notional Amounts of Derivatives (Detail) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Foreign Exchange Contracts [Member] | ||
Derivatives Fair Value [Line Items] | ||
Notional amounts | $ 6,449,000 | $ 300,000 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | |
Nov. 30, 2019 | Dec. 31, 2017 | |
Option on Securities [Member] | ||
Debt Instrument [Line Items] | ||
Derivative assets wrote off cost | $ 2,169 | |
Punchbowl Inc [Member] | ||
Debt Instrument [Line Items] | ||
Equity method investment, ownership percentage | 28.00% |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Carrying Amount and Fair Value (Detail) $ in Thousands | Sep. 30, 2020USD ($) |
Term Loan Credit Agreement [Member] | Secured Debt [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument Carrying Amount | $ 693,906 |
Debt Instrument Fair Value | 569,034 |
6.125% Senior Notes - due 2023 [Member] | Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument Carrying Amount | 22,765 |
Debt Instrument Fair Value | 8,253 |
6.625% Senior Notes - due 2026 [Member] | Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument Carrying Amount | 106,273 |
Debt Instrument Fair Value | 23,730 |
First Lien Party City Notes [Member] | Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument Carrying Amount | 207,925 |
Debt Instrument Fair Value | 155,153 |
First Lien Anagram Notes [Member] | Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument Carrying Amount | 150,958 |
Debt Instrument Fair Value | 158,056 |
Second Lien Anagram Notes [Member] | Senior Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument Carrying Amount | 152,104 |
Debt Instrument Fair Value | $ 120,162 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Basic and Diluted Loss Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Net (loss) income attributable to common shareholders of Party City Holdco Inc. | $ 239,707 | $ (281,533) | $ (431,821) | $ (263,677) |
Weighted average shares - Basic | 106,709,307 | 93,346,448 | 97,872,174 | 93,271,392 |
Effect of dilutive securities: | ||||
Warrants | 0 | 0 | 0 | 0 |
Restricted stock units | 166,324 | 0 | 0 | 0 |
Stock options | 0 | 0 | 0 | 0 |
Weighted average shares - Diluted | 106,875,631 | 93,346,448 | 97,872,174 | 93,271,392 |
Net (loss) income per share attributable to common shareholders of Party City Holdco Inc. - Basic | $ 2.25 | $ (3.02) | $ (4.41) | $ (2.83) |
Net (loss) income per share attributable to common shareholders of Party City Holdco Inc. - Diluted | $ 2.24 | $ (3.02) | $ (4.41) | $ (2.83) |
Earnings Per share - Additional
Earnings Per share - Additional Information (Detail) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Employee Stock Option [Member] | ||||
Disclosure Of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from calculation of earnings per share | 3,475,621 | 3,544,501 | 3,475,621 | 3,544,501 |
Warrant [Member] | ||||
Disclosure Of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from calculation of earnings per share | 1,000,000 | 596,000 | 1,000,000 | 596,000 |
Restricted Stock Units (RSUs) [Member] | ||||
Disclosure Of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from calculation of earnings per share | 263,727 | 416,260 | 584,258 | 416,260 |
Current and Long-Term Obligat_3
Current and Long-Term Obligations - Summary of Long-Term Obligations (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Total long-term obligations | $ 1,348,680 | $ 1,575,511 |
Less: current portion | (14,342) | (71,524) |
Long-term obligations, excluding current portion | 1,334,338 | 1,503,987 |
6.125% Senior Notes due 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term obligations | 22,765 | 347,015 |
6.625% Senior Notes due 2026 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term obligations | 106,273 | 494,910 |
First Lien Party City Notes | ||
Debt Instrument [Line Items] | ||
Total long-term obligations | 207,925 | |
First Lien Anagram Notes | ||
Debt Instrument [Line Items] | ||
Total long-term obligations | 150,958 | |
Second Lien Anagram Notes | ||
Debt Instrument [Line Items] | ||
Total long-term obligations | 152,104 | |
Finance lease obligations [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term obligations | 14,749 | 14,990 |
Term Loan Credit Agreement [Member] | Senior Secured Term Loan Facility [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term obligations | $ 693,906 | $ 718,596 |
Current and Long-Term Obligat_4
Current and Long-Term Obligations - Summary of Long-Term Obligations (Parenthetical) (Detail) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
6.125% Senior Notes due 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Notes issued rate | 6.125% | 6.125% |
Debt instrument maturity period | 2023 | 2023 |
6.625% Senior Notes due 2026 [Member] | ||
Debt Instrument [Line Items] | ||
Notes issued rate | 6.625% | 6.625% |
Debt instrument maturity period | 2026 | 2026 |
Current and Long-Term Obligat_5
Current and Long-Term Obligations - Additional Information (Detail) $ / shares in Units, $ in Thousands | Jul. 30, 2020USD ($)BasisPoint$ / sharesshares | Sep. 30, 2020USD ($)$ / shares | Dec. 31, 2019 | Apr. 25, 2019USD ($) | Mar. 31, 2019USD ($) |
Debt Instrument [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 640,000 | ||||
Common stock, par value | $ / shares | $ 0.01 | ||||
6.125% Senior Notes due 2023 [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes issued rate | 6.125% | 6.125% | |||
Debt instrument maturity period | 2023 | 2023 | |||
6.625% Senior Notes due 2026 [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes issued rate | 6.625% | 6.625% | |||
Debt instrument maturity period | 2026 | 2026 | |||
First Lien Anagram Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 44,500 | ||||
Gain on restructuring of debt | 273,149 | ||||
Third-party fees incurred | 18,902 | ||||
Common stock issued in exchange | 27,007 | ||||
Cash received from participants in the exchange | 39,544 | ||||
Debt instrument undiscounted value including interest expense | 82,160 | ||||
Carrying amount of restructured debt | $ 32,328 | ||||
Effective interest rate | 3.50% | ||||
Principal balance of notes not participants in exchange | $ 50,500 | ||||
Principal balance of notes after netting | 45,678 | ||||
Refinancing Transactions [Member] | |||||
Debt Instrument [Line Items] | |||||
Common stock issued | shares | 15,942,551 | ||||
Common stock, par value | $ / shares | $ 0.01 | ||||
Refinancing Transactions [Member] | 6.125% Senior Notes due 2023 [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 327,076 | ||||
Notes issued rate | 6.125% | ||||
Debt instrument maturity period | 2023 | ||||
Refinancing Transactions [Member] | 6.625% Senior Notes due 2026 [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 392,746 | ||||
Notes issued rate | 6.625% | ||||
Debt instrument maturity period | 2026 | ||||
Refinancing Transactions [Member] | Senior Secured First Lien Floating Rate Notes Due 2025 [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 156,669 | ||||
Debt instrument maturity period | 2025 | ||||
Refinancing Transactions [Member] | 10.00% PIK/Cash Senior Secured Second Lien Notes due 2026 [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 84,687 | ||||
Notes issued rate | 10.00% | ||||
Debt instrument maturity period | 2026 | ||||
Refinancing Transactions [Member] | 15.00% PIK/Cash Senior Secured First Lien Notes due 2025 [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 110,000 | ||||
Notes issued rate | 15.00% | ||||
Debt instrument maturity period | 2025 | ||||
Refinancing Transactions [Member] | First Lien Party City Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 5,000 | ||||
Refinancing Transactions [Member] | First Lien Party City Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 161,669 | ||||
Debt instrument maturity date | Jul. 15, 2025 | ||||
Refinancing Transactions [Member] | First Lien Party City Notes [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, description of variable rate basis | Interest on the First Lien Party City Notes accrues from the Settlement Date at a floating rate equal to the 6-month London Inter-Bank Offered Rate plus 500 basis points (with a floor of 75 basis points) per annum, payable semi-annually in arrears on January 15 and July 15 of each year, commencing January 15, 2021. | ||||
Debt instrument, offered rate plus basis points | BasisPoint | 500 | ||||
Debt instrument, floor basis points | BasisPoint | 75 | ||||
Debt instrument, frequency of periodic payment | semi-annually | ||||
Refinancing Transactions [Member] | First Lien Anagram Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 110,000 | ||||
Debt instrument maturity date | Aug. 15, 2025 | ||||
Debt instrument, description of variable rate basis | Interest on the First Lien Anagram Notes accrues from the Settlement Date at (i) a rate of 10.00% per annum, payable in cash; and (ii) a rate of 5.00% per annum payable by increasing the principal amount of the outstanding First Lien Anagram Notes or issuing additional First Lien Anagram Notes, as the case may be, in each case payable semi-annually in arrears on February 15 and August 15 of each year, commencing February 15, 2021. | ||||
Debt instrument, frequency of periodic payment | semi-annually | ||||
Debt instrument, interest rate payable in cash | 10.00% | ||||
Debt instrument, interest rate payable on incremental principal | 5.00% | ||||
Refinancing Transactions [Member] | Second Lien Anagram Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Aggregate principal amount | $ 84,687 | ||||
Debt instrument maturity date | Aug. 15, 2026 | ||||
Debt instrument, description of variable rate basis | Interest on the Second Lien Anagram Notes accrues from the Settlement Date at (i) a rate of 5.00% per annum, payable, at the Anagram Issuers’ option, entirely in cash or entirely by increasing the principal amount of the outstanding Second Lien Anagram Notes or issuing additional Second Lien Anagram Notes, as the case may be; and (ii) a rate of 5.00% per annum payable by increasing the principal amount of the outstanding Second Lien Anagram Notes or issuing additional Second Lien Anagram Notes, as the case may be, in each case payable semi-annually in arrears on February 15 and August 15 of each year, commencing February 15, 2021 | ||||
Debt instrument, frequency of periodic payment | semi-annually | ||||
Debt instrument, interest rate payable in cash | 5.00% | ||||
Debt instrument, interest rate payable on incremental principal | 5.00% | ||||
US Treasury Funds [Member] | |||||
Debt Instrument [Line Items] | |||||
Short term investment | $ 100,100 | ||||
Asset Based Revolving Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 640,000 | 540,000 | |||
Debt instrument maturity, year and month | 2023-08 | ||||
Letters Of Credit, Maximum Outstanding | $ 50,000 | ||||
Outstanding aggregate principal amount, prepaid | $ 44,000 | ||||
Line of credit drew down | 269,800 | ||||
Line of credit availability | $ 178,500 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Summary of Revenue from Contracts with Customers (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 533,775 | $ 540,231 | $ 1,202,509 | $ 1,617,238 |
Retail Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 366,203 | 371,353 | 854,961 | 1,176,866 |
Wholesale Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 167,572 | 168,878 | 347,548 | 440,372 |
Other Retail Segment Store [Member] | Retail Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | 6,235 | 5,834 | 21,331 | 6,524 |
Net Sales [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | 532,053 | 538,345 | 1,198,160 | 1,611,149 |
Net Sales [Member] | Retail Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | 364,481 | 369,467 | 850,612 | 1,170,777 |
Royalties and Franchise Fees [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | 1,722 | 1,886 | 4,349 | 6,089 |
Royalties and Franchise Fees [Member] | Retail Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | 1,722 | 1,886 | 4,349 | 6,089 |
North America [Member] | Party City Stores [Member] | Retail Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | 358,246 | 363,633 | 829,281 | 1,164,253 |
Domestic [Member] | Wholesale Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | 79,388 | 82,670 | 177,263 | 231,257 |
International [Member] | Wholesale Segment [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Net Sales | $ 88,184 | $ 86,208 | $ 170,285 | $ 209,115 |
Cash, Cash Equivalents and Re_2
Cash, Cash Equivalents and Restricted Cash - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Restricted Cash And Cash Equivalents Items [Line Items] | ||
Cash and cash equivalents | $ 170,562 | $ 34,917 |
Prepaid Expenses and Other Current Assets [Member] | ||
Restricted Cash And Cash Equivalents Items [Line Items] | ||
Restricted cash | $ 125 | $ 259 |
Kazzam, LLC - Additional Inform
Kazzam, LLC - Additional Information (Detail) - Kazzam LLC [Member] - shares | Mar. 23, 2020 | Dec. 31, 2019 |
Schedule Of Equity Method Investments [Line Items] | ||
Equity method investment, ownership percentage | 26.00% | |
Number of years for royalty on net service revenue | 3 years | |
Maximum [Member] | ||
Schedule Of Equity Method Investments [Line Items] | ||
Warrant to purchase common stock | 1,000,000 |