Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | DFIN | |
Entity Registrant Name | Donnelley Financial Solutions, Inc. | |
Entity Central Index Key | 0001669811 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 33,733,441 | |
Title of 12(b) Security | Common Stock (Par Value $0.01) | |
Security Exchange Name | NYSE | |
Entity File Number | 1-37728 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 36-4829638 | |
Entity Address, Address Line One | 35 West Wacker Drive | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60601 | |
City Area Code | 844 | |
Local Phone Number | 866-4337 | |
Document Quarterly Report | true | |
Document Transition Report | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (UNAUDITED) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
Total net sales | $ 220.7 | $ 229.6 | |
Total cost of sales | [1] | 136.3 | 153.9 |
Selling, general and administrative expenses | [1] | 57 | 54.9 |
Depreciation and amortization | 12.4 | 12.1 | |
Restructuring, impairment and other charges, net | 3.1 | 2.1 | |
Income from operations | 11.9 | 6.6 | |
Interest expense, net | 4.6 | 8.9 | |
Investment and other income, net | (0.4) | (0.6) | |
Earnings (loss) before income taxes | 7.7 | (1.7) | |
Income tax expense (benefit) | 3.6 | (0.3) | |
Net earnings (loss) | $ 4.1 | $ (1.4) | |
Net earnings (loss) per share: | |||
Basic | $ 0.12 | $ (0.04) | |
Diluted | $ 0.12 | $ (0.04) | |
Weighted average number of common shares outstanding: | |||
Basic | 34.2 | 34 | |
Diluted | 34.3 | 34 | |
Tech-enabled Services | |||
Total net sales | $ 81.9 | $ 83.2 | |
Total cost of sales | 42.8 | 48.8 | |
Software Solutions | |||
Total net sales | 47.3 | 44.7 | |
Total cost of sales | 24.8 | 26.6 | |
Print and Distribution | |||
Total net sales | 91.5 | 101.7 | |
Total cost of sales | $ 68.7 | $ 78.5 | |
[1] | Exclusive of depreciation and amortization |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (UNAUDITED) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net earnings (loss) | $ 4.1 | $ (1.4) |
Other comprehensive (loss) income, net of tax: | ||
Translation adjustments | (2.8) | 2.2 |
Adjustment for net periodic pension and other postretirement benefits plan | 0.6 | 0.4 |
Other comprehensive (loss) income, net of tax | (2.2) | 2.6 |
Comprehensive income | $ 1.9 | $ 1.2 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (UNAUDITED) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 | |
ASSETS | |||
Cash and cash equivalents | $ 7.7 | $ 17.2 | |
Receivables, less allowances for expected losses of $9.7 in 2020 (2019 - $7.7) | 214.6 | 161.4 | |
Inventories | 15.2 | 11.1 | |
Prepaid expenses and other current assets | 21.2 | 15.9 | |
Assets held for sale | 5.6 | 5.6 | |
Total current assets | 264.3 | 211.2 | |
Property, plant and equipment, net | 16.5 | 17.5 | |
Right-of-use assets | 80.3 | 80.7 | |
Software, net | 55.2 | 55 | |
Goodwill | 449.7 | 450.3 | |
Other intangible assets, net | 18.4 | 21.9 | |
Deferred income taxes, net | 9.1 | 9 | |
Other noncurrent assets | 41.3 | 41.3 | |
Total assets | 934.8 | [1] | 886.9 |
LIABILITIES | |||
Accounts payable | 72.1 | 58.5 | |
Accrued liabilities | 120 | 121 | |
Total current liabilities | 192.1 | 179.5 | |
Long-term debt | 336.6 | 296 | |
Deferred compensation liabilities | 18.8 | 20 | |
Pension and other postretirement benefits plan liabilities | 57.2 | 58.8 | |
Noncurrent lease liabilities | 57.8 | 57.9 | |
Other noncurrent liabilities | 5.2 | 6.1 | |
Total liabilities | 667.7 | 618.3 | |
Commitments and Contingencies (Note 7) | |||
EQUITY | |||
Preferred stock, $0.01 par value Authorized: 1.0 shares; Issued: None | 0 | 0 | |
Common stock, $0.01 par value Authorized: 65.0 shares; Issued and outstanding: 34.8 shares and 33.8 shares in 2020 (2019 - 34.5 shares and 34.2 shares) | 0.3 | 0.3 | |
Treasury stock, at cost: 1.0 shares in 2020 (2019 - 0.3 shares) | (9.4) | (4.2) | |
Additional paid-in-capital | 227.5 | 225.2 | |
Retained earnings | 135.5 | 131.9 | |
Accumulated other comprehensive loss | (86.8) | (84.6) | |
Total equity | 267.1 | 268.6 | |
Total liabilities and equity | $ 934.8 | $ 886.9 | |
[1] | Certain assets are recorded within a segment based on predominant usage, however as they benefit more than one segment, the related operating expenses are allocated between segments. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (UNAUDITED) (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Receivables, allowance for expected losses | $ 9.7 | $ 7.7 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, authorized | 1,000,000 | 1,000,000 |
Preferred stock, Issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, Authorized | 65,000,000 | 65,000,000 |
Common stock, Issued | 34,800,000 | 34,500,000 |
Common stock, Outstanding | 33,800,000 | 34,200,000 |
Treasury stock, Shares | 1,000,000 | 300,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (UNAUDITED) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
OPERATING ACTIVITIES | ||
Net earnings (loss) | $ 4.1 | $ (1.4) |
Adjustments to reconcile net earnings (loss) to net cash used in operating activities: | ||
Depreciation and amortization | 12.4 | 12.1 |
Provision for expected losses on accounts receivable | 1.6 | 1 |
Share-based compensation | 2.3 | 1.5 |
Gain on debt extinguishment | (2.3) | 0 |
Deferred income taxes | (0.5) | (2.8) |
Net pension plan income | (0.5) | (0.5) |
Amortization of right-of-use assets | 5.8 | 5.7 |
Other | 0.1 | 2 |
Changes in operating assets and liabilities - net of acquisitions: | ||
Accounts receivable, net | (55.7) | (63.6) |
Inventories | (4.2) | (2.7) |
Prepaid expenses and other current assets | (4.7) | (3.2) |
Accounts payable | 12.5 | 23.9 |
Income taxes payable and receivable | 2.1 | (11.3) |
Accrued liabilities and other | (4) | (23.3) |
Lease liabilities | (5.9) | (5.5) |
Pension and other postretirement benefits plan contributions | (0.2) | (0.2) |
Net cash used in operating activities | (37.1) | (68.3) |
INVESTING ACTIVITIES | ||
Capital expenditures | (6.9) | (15.1) |
Acquisition of business, net of cash acquired | 0 | (2.2) |
Purchase of investment | (1.3) | 0 |
Other investing activities | 0 | 0.2 |
Net cash used in investing activities | (8.2) | (17.1) |
FINANCING ACTIVITIES | ||
Revolving facility borrowings | 146.5 | 178.5 |
Payments on revolving facility borrowings | (40.5) | (130) |
Payments on long-term debt | (63.3) | 0 |
Treasury share repurchases | (5.2) | (1.2) |
Debt issuance costs | 0 | (0.2) |
Net cash provided by financing activities | 37.5 | 47.1 |
Effect of exchange rate on cash and cash equivalents | (1.7) | 1.5 |
Net decrease in cash and cash equivalents | (9.5) | (36.8) |
Cash and cash equivalents at beginning of year | 17.2 | 47.3 |
Cash and cash equivalents at end of period | 7.7 | 10.5 |
Supplemental cash flow information | ||
Income taxes paid (net of refunds) | 2 | 13.8 |
Interest paid | $ 2.6 | $ 1.5 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Changes in Stockholders' Equity (UNAUDITED) - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Treasury Stock | Additional Paid-in-Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Loss |
Balance at Dec. 31, 2018 | $ 226 | $ 0.3 | $ (2.4) | $ 216.5 | $ 94.3 | $ (82.7) |
Balance (in shares) at Dec. 31, 2018 | 34.2 | 0.1 | ||||
Net earnings (loss) | (1.4) | (1.4) | ||||
Other comprehensive (loss) income | 2.6 | 2.6 | ||||
Share-based compensation | 1.5 | 1.5 | ||||
Issuance of share-based awards, net of withholdings and other | (1.2) | $ (1.2) | ||||
Issuance of share-based awards, net of withholdings and other (in shares) | 0.2 | 0.1 | ||||
Balance at Mar. 31, 2019 | 227.5 | $ 0.3 | $ (3.6) | 218 | 92.9 | (80.1) |
Balance (in shares) at Mar. 31, 2019 | 34.4 | 0.2 | ||||
Balance at Dec. 31, 2019 | $ 268.6 | $ 0.3 | $ (4.2) | 225.2 | 131.9 | (84.6) |
Balance (in shares) at Dec. 31, 2019 | 34.5 | 34.5 | 0.3 | |||
Net earnings (loss) | $ 4.1 | 4.1 | ||||
Other comprehensive (loss) income | (2.2) | (2.2) | ||||
Adoption of ASU 2016-13 | (0.5) | (0.5) | ||||
Share-based compensation | 2.3 | 2.3 | ||||
Common stock repurchases | (3.8) | $ (3.8) | ||||
Common stock repurchases, shares | 0.6 | |||||
Issuance of share-based awards, net of withholdings and other | (1.4) | $ (1.4) | ||||
Issuance of share-based awards, net of withholdings and other (in shares) | 0.3 | 0.1 | ||||
Balance at Mar. 31, 2020 | $ 267.1 | $ 0.3 | $ (9.4) | $ 227.5 | $ 135.5 | $ (86.8) |
Balance (in shares) at Mar. 31, 2020 | 34.8 | 34.8 | 1 |
Overview, Basis of Presentation
Overview, Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Overview, Basis of Presentation and Significant Accounting Policies | Note 1. Overview, Basis of Presentation and Significant Accounting Policies Description of Business Donnelley Financial Solutions, Inc. and subsidiaries (“DFIN,” or the “Company”) is a leading global risk and compliance solutions company. The Company provides regulatory filing and deal solutions via its software technology-enabled services and print and distribution solutions to public and private companies, mutual funds and other regulated investment firms, to serve its clients’ regulatory and compliance needs. DFIN helps its clients comply with applicable regulations where and how they want to work in a digital world, providing numerous solutions tailored to each client’s precise needs. The prevailing trend is toward clients choosing to utilize the Company’s software solutions, in conjunction with its tech-enabled services, to meet their document and filing needs, while at the same time shifting away from physical print and distribution of documents, except for cases where it is still regulatorily required or requested by shareholders. For corporate clients within its capital markets offerings, the Company offers solutions that allow U.S. public companies to comply with applicable U.S. Securities and Exchange Commission (“SEC”) regulations including filing agent services, digital document creation and online content management tools that support their corporate financial transactions and regulatory reporting; solutions to facilitate clients’ communications with their shareholders; and virtual data rooms and other deal management solutions. For investment companies, including mutual fund and alternative investment companies, the Company provides solutions for creating and filing high-quality regulatory documents as well as solutions for investors designed to improve the speed and accuracy of their access to investment information. The Company serves its clients’ regulatory and compliance needs throughout their respective life cycles. Services and Products The Company separately reports its net sales and related cost of sales for its software solutions, tech-enabled services and print and distribution offerings. The Company’s software solutions consist of Venue® Virtual Data Room (“Venue”), ActiveDisclosure, eBrevia, FundSuiteArc, and others. The Company’s tech-enabled services offerings consist of document composition, compliance-related SEC’s Electronic Data Gathering, Analysis, and Retrieval (“EDGAR”) filing services and transaction solutions. The Company’s print and distribution offerings primarily consist of conventional and digital printed products and the related shipping. Segments In the first quarter of 2020, management realigned the Company’s operating segments to reflect changes in the manner in which the chief operating decision maker assesses information for decision-making purposes. The Company’s four operating and reportable segments are: Capital Markets – Software Solutions (“CM-SS”), Capital Markets – Compliance and Communications Management (“CM-CCM”), Investment Companies – Software Solutions (“IC-SS”), and Investment Companies – Compliance and Communications Management (“IC-CCM”). Corporate Segment Information, Basis of Presentation The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of DFIN and have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the rules and regulations of the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The financial data presented herein should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s latest Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on February 26, 2020 (the “Annual Report”). In the opinion of management, the financial data presented includes all adjustments necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented. Results of interim periods should not be considered indicative of the results for the full year. Certain previously reported amounts have been reclassified to conform to the current presentation, there was no impact on the Company’s previously reported consolidated statements of operations, statements of comprehensive income, balance sheets, statements of cash flows or statements of changes in stockholders’ equity. Significant Accounting Policies Use of Estimates— The preparation of financial statements in conformity with GAAP requires the extensive use of management’s estimates and assumptions that affect the reported amounts of assets and liabilities as well as disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. The Company’s significant accounting policies and critical estimates are disclosed in the Company’s Annual Report. Prepaid Expenses —As of March 31, 2020 and December 31, 2019, prepaid expenses were $13.8 million and $9.6 million, respectively. Inventory— The components of the Company’s inventories stated at the lower of cost or market, net of excess and obsolescence reserves for raw materials, at March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Raw materials and manufacturing supplies $ 6.7 $ 3.9 Work in process 8.5 7.2 Total $ 15.2 $ 11.1 Property, Plant and Equipment— The components of the Company’s property, plant and equipment, net at March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Land $ 0.3 $ 0.3 Buildings 27.1 26.8 Machinery and equipment 112.0 111.9 139.4 139.0 Less: Accumulated depreciation (122.9 ) (121.5 ) Total $ 16.5 $ 17.5 Depreciation expense was $1.7 million and $1.5 million for the three months ended March 31, 2020 and 2019, respectively. Assets Held for Sale —As of March 31, 2020 and December 31, 2019, the Company had one real estate property, primarily consisting of land and an office building, held for sale with a carrying value of $5.6 million. Software — Capitalized software development costs are amortized over their estimated useful life using the straight-line method, up to a maximum of three years. Amortization expense related to internally-developed software, excluding amortization expense related to other intangible assets, was $7.3 million and $6.9 million for the three months ended March 31, 2020 and 2019 Investments — The carrying value of the Company’s investments in equity securities was $25.2 million at both March 31, 2020 and December 31, 2019. The Company measures its equity securities that do not have a readily determinable fair value, at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The Company performs an assessment on a quarterly basis to determine whether triggering events for impairment exist and to identify any observable price changes. During the three months ended March 31, 2020, there were no events or changes in circumstances that suggested an impairment or an observable price change of any of these investments resulting from an orderly transaction for the identical or a similar investment. Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which replaces the incurred loss model with a current expected credit loss (“CECL”) model and requires consideration of a broader range of reasonable and supportable information to explain credit loss estimates. This standard applies to financial assets, measured at amortized cost, including loans, held-to-maturity debt securities, net investments in leases and trade accounts receivable. The guidance must be adopted using a modified retrospective transition method through a cumulative-effect adjustment to retained earnings in the period of adoption. On January 1, 2020, the Company adopted the standard and recorded a $0.5 million cumulative-effect adjustment to retained earnings. The Company’s credit loss reserves primarily relate to trade receivables, unbilled receivables and contract assets. The Company establishes provisions at differing rates, which are region or country-specific, and are based upon the age of the trade receivable, the Company’s historical collection experience in each region or country and lines of business, where appropriate. Provisions for unbilled receivables and contract assets are established based on rates which management believes to be appropriate considering its historical experience. Specific customer provisions are made when a review of significant outstanding amounts, utilizing information about customer creditworthiness and current economic trends, indicates that collection is doubtful. Transactions affecting the current expected credit loss reserve during the three months ended March 31, 2020 were as follows: March 31, 2020 Balance, beginning of year $ 7.7 Adoption of ASU 2016-13 0.5 Provisions charged to expense and reclassifications 2.3 Write-offs and other (0.8 ) Balance, end of period (a) $ 9.7 _____________ (a) As of March 31, 2020, the CECL reserve balance is comprised of an $8.8 million provision for accounts receivable and a $0.9 million provision for unbilled receivables and contract assets, all of which are included in receivables, net on the Unaudited Condensed Consolidated Balance Sheet. As of December 31, 2019, prior to the adoption of ASU 2016-13, the reserve balance was comprised of a $7.7 million allowance for doubtful accounts. I n August 2018, the FASB issued ASU No. 2018-15, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40).” The standard requires a customer in a hosting arrangement that is a service contract to follow the internal-use software guidance to determine which implementation costs to capitalize as an asset related to the service contract and to expense the capitalized implementation costs over the term of the hosting arrangement. The standard is effective for fiscal years beginning after December 15, 2019, and the interim periods within those fiscal years. The Company adopted the amendment prospectively on January 1, 2020. The adoption of the standard did not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provides optional guidance for a limited period of time to use optional expedients and exceptions for applying U.S. GAAP to contracts and other transactions affected by reference rate reform, if certain criteria are met. The amendments in ASU 2020-04 apply only to contracts and other transactions that reference the London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued due to reference rate reform. Generally, the expedients and exceptions provided by ASU 2020-04 would only be allowed for contract modifications made prior to December 31, 2022. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which modifies ASC 740, Income Taxes, to simplify the accounting for income taxes by removing certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. ASU 2019-12 also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2020 | |
Revenue Recognition [Abstract] | |
Revenue | Note 2. Revenue Revenue Recognition The Company manages highly-customized data and materials, such as filings with the SEC on behalf of its customers pursuant to the Securities Act of 1933, as amended (the “Securities Act”), the Securities Act of 1934, as amended (the “Exchange Act”), and the Securities Act of 1940, as amended (the “Investment Act”), manages virtual data rooms and performs XBRL and related services. Clients are provided with EDGAR filing services, XBRL compliance services and translation, editing, interpreting, proof-reading and multilingual typesetting services, among others. The Company’s software solutions include Venue, the FundSuiteArc software platform, ActiveDisclosure and data and analytics, among others. Substantially all of the Company’s revenue is derived from contracts with an initial expected duration of one year or less. Generally, customer payment is due within ten days upon invoicing. Revenue is recognized upon transfer of control of promised services or products to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services or products. The Company’s arrangements with customers often include promises to transfer multiple services or products to a customer. Determining whether services and products are considered distinct performance obligations that should be accounted for separately requires significant judgment. Certain customer arrangements have multiple performance obligations as certain promises are both capable of being distinct and are distinct within the context of the contract. Other customer arrangements have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts, and therefore are not distinct. Revenue for the Company’s tech-enabled services, software solutions and print and distribution offerings is recognized either over time or at a point in time, as outlined below. Over time The Company recognizes revenue for certain services over time: • The Company’s software solutions, including Venue, the FundSuiteArc software platform, ActiveDisclosure, data and analytics and others, are generally provided on a subscription basis and allow customers access to use the products over the contract period. As a result, software solutions revenue is predominantly recognized ratably over time as the customer receives the benefit throughout the contract period. The timing of invoicing varies, however, the customer may be invoiced before the end of the contract period, resulting in a deferred revenue balance. Point in time Certain revenue arrangements, primarily for tech-enabled services and print and distribution offerings, are recognized at a point in time and are primarily invoiced upon completion of all services or upon shipment to the customer. • Certain arrangements include multiple performance obligations and revenue is recognized upon completion of each performance obligation, such as when a document is filed with a regulatory agency and upon completion of printing the related document. For arrangements with multiple performance obligations, the transaction price is allocated to the separate performance obligations. The Company provides customer specific solutions and as such, observable standalone selling price is rarely available. Standalone selling price is determined using an estimate of the standalone selling price of each distinct service or product, taking into consideration historical selling price by customer for each distinct service or product. These estimates may vary from the final amounts invoiced to the customer and are adjusted upon completion of all performance obligations. Customers may be invoiced subsequent to the recognition of revenue for completed performance obligations , resulting in contract asset balances. • Revenue for arrangements which include assisting customers in completing regulatory filings for transactions, such as mergers and acquisitions or other public capital market transactions, is recognized upon completion of all obligations, including the services performed and printing of the related document, if applicable. • Revenue for arrangements without a regulatory filing generally have a single performance obligation. As the services and products provided are not distinct within the context of the contract, the revenue is recognized upon completion of the services performed or upon completion of printing of the related product. • Warehousing, fulfillment services and shipping and handling are each separate performance obligations. As a result, when the Company provides warehousing and future fulfillment services, revenue for the composition services performed and printing of the product is recognized upon completion of the performance obligation(s), as control of the inventory has transferred to the customer and the inventory is being stored at the customer’s request. Because substantially all of the Company’s products are customized, product returns are not significant; however, the Company accrues for the estimated amount of customer credits at the time of sale. The Company records deferred revenue when amounts are invoiced but the revenue recognition criteria are not yet met. Such revenue is recognized when all criteria are subsequently met. Certain revenues earned by the Company require significant judgment to determine if revenue should be recorded gross, as a principal, or net of related costs, as an agent. Billings for shipping and handling costs as well as certain postage costs, and out-of-pocket expenses are recorded gross. Revenue is not recognized for customer-supplied postage. The Company’s printing operations process paper that may be supplied directly by customers or may be purchased by the Company from third parties and sold to customers. Revenue is not recognized for customer-supplied paper, however, revenues for Company-supplied paper are recognized on a gross basis. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to authorities. Disaggregation of revenue The following table disaggregates revenue between tech-enabled services, software solutions and print and distribution by reportable segment: Three Months Ended March 31, 2020 2019 Tech-enabled Services Software Solutions Print and Distribution Total Tech-enabled Services Software Solutions Print and Distribution Total Capital Markets - Software Solutions $ — $ 31.2 $ — $ 31.2 $ — $ 30.5 $ — $ 30.5 Capital Markets - Compliance and Communications Management 57.9 — 41.2 99.1 59.5 — 42.5 102.0 Investment Companies - Software Solutions — 16.1 — 16.1 — 14.2 — 14.2 Investment Companies - Compliance and Communications Management 24.0 — 50.3 74.3 23.7 — 59.2 82.9 Total net sales $ 81.9 $ 47.3 $ 91.5 $ 220.7 $ 83.2 $ 44.7 $ 101.7 $ 229.6 Unbilled Receivables and Contract Balances The timing of revenue recognition may differ from the timing of invoicing customers and these timing differences result in unbilled receivables, contract assets or contract liabilities. Contract assets represent revenue recognized for performance obligations completed before an unconditional right to payment exists, and therefore invoicing has not yet occurred. Unbilled receivables are recorded when there is an unconditional right to payment and invoicing has not yet occurred. Unbilled receivables were $76.0 million at March 31, 2020 and $33.5 million at December 31, 2019. Contract assets were $14.5 million at March 31, 2020 and $8.9 million at December 31, 2019, respectively. Generally, the contract assets balance is impacted by the recognition of additional contract assets, offset by amounts invoiced to customers. For the three months ended March 31, 2020, final amounts invoiced to customers exceeded estimates of standalone selling price as of December 31, 2019 for the related arrangements by approximately $0.1 million. Unbilled receivables and contract assets are included in accounts receivable on the Unaudited Condensed Consolidated Balance Sheets. Contract liabilities consist of deferred revenue and progress billings which are included in accrued liabilities on the Unaudited Condensed Consolidated Balance Sheets. Changes in contract liabilities for the three months ended March 31, 2020 and 2019, respectively, were as follows: Balance at January 1, 2020 $ 13.1 Deferral of revenue 11.2 Revenue recognized (9.6 ) Balance at March 31, 2020 $ 14.7 Balance at January 1, 2019 $ 12.0 Deferral of revenue 12.2 Revenue recognized (12.6 ) Balance at March 31, 2019 $ 11.6 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 3. Goodwill and Other Intangible Assets As discussed in Note 1, Overview, Basis of Presentation and Significant Accounting Policies four As a result of the new segmentation, a goodwill impairment analysis was completed for the Previous Structure, before the reallocation of goodwill to the Current Structure. Each of the reporting units under the Previous Structure was reviewed for impairment using a quantitative assessment, where the estimated fair value of each reporting unit was compared to its carrying amount, including goodwill. The Company did not recognize any goodwill impairment as the estimated fair values of all reporting units exceeded their respective carrying amounts. In addition to the impairment analysis under the Previous Structure, a goodwill impairment analysis was completed under the Current Structure and no goodwill impairment was recognized as the estimated fair values of all reporting units exceeded their respective carrying amounts. The balances of goodwill by segment are presented below: March 31, 2020 Capital Markets - Software Solutions $ 103.6 Capital Markets - Compliance and Communication Management 252.5 Investment Companies - Software Solutions 53.0 Investment Companies - Compliance and Communication Management 40.6 Total $ 449.7 The components of other intangible assets at March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Gross Carrying Amount Accumulated Impairment Charges Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Impairment Charges Accumulated Amortization Net Book Value Customer relationships (useful life of 10- 15 years $ 148.6 $ (1.0 ) $ (130.0 ) $ 17.6 $ 149.8 $ (1.0 ) $ (127.7 ) $ 21.1 Trade names (useful life of 5 years 3.9 — (3.1 ) 0.8 3.9 — (3.1 ) 0.8 Total other intangible assets $ 152.5 $ (1.0 ) $ (133.1 ) $ 18.4 $ 153.7 $ (1.0 ) $ (130.8 ) $ 21.9 Amortization expense for other intangible assets was $3.4 million and $3.7 million for the three months ended March 31, 2020 and 2019, respectively. The weighted-average remaining useful life of the unamortized intangible assets as of March 31, 2020 is approximately seven years. The following table outlines the estimated annual amortization expense related to other intangible assets: For the year ending December 31, Amount 2020 (excluding the three months ended March 31, 2020) $ 8.9 2021 0.9 2022 0.9 2023 0.9 2024 0.7 2025 and thereafter 6.1 Total $ 18.4 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Note 4. Leases The Company has operating leases for certain service centers, office space, warehouses and equipment. The Company paid $6.8 million and $6.6 million related to its operating lease liabilities for the three months ended March 31, 2020 and March 31, 2019, respectively. The components of lease expense for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Operating lease expense $ 6.7 $ 6.8 Sublease income (1.3 ) (0.8 ) Net lease expense $ 5.4 $ 6.0 The Company’s lease liabilities are presented within the Company’s Unaudited Condensed Consolidated Balance Sheets as follows: March 31, 2020 December 31, 2019 Accrued liabilities $ 22.1 $ 22.6 Noncurrent lease liabilities 57.8 57.9 Total $ 79.9 $ 80.5 |
Restructuring, Impairment and O
Restructuring, Impairment and Other Charges | 3 Months Ended |
Mar. 31, 2020 | |
Restructuring And Related Activities [Abstract] | |
Restructuring, Impairment and Other Charges | Note 5. Restructuring, Impairment and Other Charges Restructuring, Impairment and Other Charges recognized in Results of Operations For the three months ended March 31, 2020 and 2019, the Company recorded the following net restructuring and other charges: Three Months Ended March 31, 2020 Total Restructuring Charges Other Charges Total Capital Markets - Software Solutions $ 0.3 $ — $ 0.3 Capital Markets - Compliance and Communication Management 0.4 0.1 0.5 Investment Companies - Software Solutions 0.3 — 0.3 Investment Companies - Compliance and Communication Management 0.4 — 0.4 Corporate 0.2 1.4 1.6 Total $ 1.6 $ 1.5 $ 3.1 Three Months Ended March 31, 2019 Total Restructuring Charges Other Charges Total Capital Markets - Software Solutions $ 0.3 $ — $ 0.3 Capital Markets - Compliance and Communication Management 0.8 0.1 0.9 Investment Companies - Software Solutions 0.1 — 0.1 Investment Companies - Compliance and Communication Management 0.4 — 0.4 Corporate 0.4 — 0.4 Total $ 2.0 $ 0.1 $ 2.1 For the three months ended March 31, 2020, the Company recorded net restructuring charges of $1.6 million for employee termination costs for 51 employees, substantially all of whom were terminated as of March 31, 2020. These charges primarily related to the reorganization of certain operations. For the three months ended March 31, 2020, the Company also incurred $1.5 million of other charges, primarily related to the realignment of the Company’s operating segments Segment Information For the three months ended March 31, 2019, the Company recorded net restructuring charges of $2.0 million for employee termination costs for 72 employees, all of whom were terminated as of March 31, 2019. These charges primarily related to the reorganization of certain operations. Restructuring Reserve The restructuring reserve as of December 31, 2019 and March 31, 2020, and changes during the three months ended March 31, 2020, were as follows: December 31, 2019 Restructuring Charges Reversals Cash Paid March 31, 2020 Employee terminations $ 1.9 $ 1.7 $ (0.1 ) $ (1.6 ) $ 1.9 The current portion of restructuring reserves of $1.8 million at March 31, 2020 March 31, 2020 The Company anticipates that payments associated with the employee terminations reflected in the table above will be substantially completed by December 31, 2020. |
Retirement Plans
Retirement Plans | 3 Months Ended |
Mar. 31, 2020 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Plans | Note 6. Retirement Plans The components of the estimated net pension plan income for the Company’s pension plans for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Interest cost $ 2.2 $ 2.8 Expected return on assets (3.5 ) (3.7 ) Amortization, net 0.8 0.4 Net pension income $ (0.5 ) $ (0.5 ) |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 7. Commitments and Contingencies Litigation From time to time, the Company’s customers and others file voluntary petitions for reorganization under United States bankruptcy laws. In such cases, certain pre-petition payments received by the Company from these parties could be considered preference items and subject to return. In addition, the Company may be party to certain litigation arising in the ordinary course of business. Management believes that the final resolution of these preference items and litigation will not have a material effect on the Company’s consolidated results of operations, financial position or cash flows. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Note 8. Debt The Company’s debt as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, 2020 December 31, 2019 8.25% senior notes due October 15, 2024 $ 233.5 $ 300.0 Borrowings under the Revolving Facility 106.0 — Unamortized debt issuance costs (2.9 ) (4.0 ) Total long-term debt $ 336.6 $ 296.0 Maturities —At March 31, 2020, the Company’s long-term debt was comprised of the 8.25% senior unsecured notes due October 15, 2024 (“Notes”) and borrowings under the Revolving Facility, as defined below. Fair Value —The fair value of the Notes, which was determined using the market approach based upon interest rates available to the Company for borrowings with similar terms and maturities, was determined to be Level 2 under the fair value hierarchy. The fair value of the Company’s Notes was $212.0 and $308.4 million at March 31, 2020 and December 31, 2019, respectively. 8.25% Senior Notes Due 2024 —In the first quarter of 2020, the Company purchased and retired $66.5 million (notional amount) of the Notes at an average price of 95.25 and recognized a pre-tax gain on the extinguishment of debt of $2.3 million, which was net of unamortized debt issuance costs, and is recorded within interest expense, net in the Unaudited Condensed Consolidated Statements of Operations. The Company’s Notes, with interest payable semi-annually on April 15 and October 15, were issued pursuant to an indenture where certain wholly-owned domestic subsidiaries of the Company guarantee the Notes (the “Guarantors”). The Notes are jointly and severally guaranteed, on an unsecured basis, by the Guarantors, which are comprised of each of the Company’s existing and future direct and indirect wholly-owned U.S. subsidiaries that guarantee the Company’s obligations under the Credit Facilities. The Notes are not guaranteed by the Company’s foreign subsidiaries or unrestricted subsidiaries. The Notes and the related guarantees will be the Company and the Guarantors’, respective, senior unsecured obligations and rank equally in right of payment to all present and future senior debt, including the obligations under the Company’s Credit Facilities, senior in right of payment to all present and future subordinated debt, and effectively subordinated in right of payment to any of the Company and the Guarantors’ secured debt, to the extent of the value of the assets securing such debt. The indenture governing the Notes contains certain covenants applicable to the Company and its restricted subsidiaries, including limitations on: (1) liens; (2) indebtedness; (3) mergers, consolidations and acquisitions; (4) sales, transfers and other dispositions of assets; (5) loans and other investments; (6) dividends and other distributions, stock repurchases and redemptions and other restricted payments; (7) restrictions affecting subsidiaries; (8) transactions with affiliates; and (9) designations of unrestricted subsidiaries. Each of these covenants is subject to important exceptions and qualifications. Credit Agreement — On September 30, 2016, the Company entered into a Credit Agreement, as amended (“the Credit Agreement”) by and among the Company, the lenders party thereto from time to time and JP Morgan Chase Bank, N.A., as administrative agent. The Credit Agreement provides for a $ 350.0 million senior secured term loan B facility (the “Term Loan Credit Facility”) and a $ 300.0 million senior secured revolving credit facility (the “Revolving Facility”, and, together with the Term Loan Credit Facility, the “Credit Facilities”). The Credit Agreement contains a number of covenants, including a minimum Interest Coverage Ratio and a maximum Leverage Ratio, as defined in and calculated pursuant to the Credit Agreement, that, in part, restrict the Company’s ability to incur additional indebtedness, create liens, engage in mergers and consolidations, make restricted payments and dispose of certain assets. The Credit Agreement generally allows annual dividend payments of up to $ 20.0 million in the aggregate. As of December 31, 2019, the Company paid off its Term Loan Credit Facility. Revolving Credit Facility —On December 18, 2018, the Company entered into a second amendment to the Credit Agreement which extended the maturity date of the Revolving Facility to December 18, 2023. As of March 31, 2020, there was $106.0 million of borrowings outstanding under the Revolving Facility. The weighted average interest rate on borrowings under the Revolving Facility was 3.8% and 5.1% for the three months ended March 31, 2020 and 2019, respectively. The following table summarizes interest expense, net included in the Unaudited Condensed Consolidated Statements of Operations Three Months Ended March 31, 2020 2019 Interest incurred $ 6.9 $ 8.9 Less: Gain on debt extinguishment (2.3 ) — Interest expense, net $ 4.6 $ 8.9 |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 9. Earnings per Share Basic earnings (loss) per share is calculated by dividing net earnings (loss) by the weighted average number of common shares outstanding for the period. In computing diluted earnings per share, basic earnings per share is adjusted for the assumed issuance of all potentially dilutive share-based awards, including stock options, restricted stock units, performance share units and restricted stock. The reconciliation of the numerator and denominator of the basic and diluted earnings (loss) per share calculation and the anti-dilutive share-based awards for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Net earnings (loss) per share: Basic $ 0.12 $ (0.04 ) Diluted $ 0.12 $ (0.04 ) Numerator: Net earnings (loss) $ 4.1 $ (1.4 ) Denominator: Weighted average number of common shares outstanding 34.2 34.0 Dilutive awards 0.1 — Diluted weighted average number of common shares outstanding 34.3 34.0 Weighted average number of anti-dilutive share-based awards: Restricted stock units 0.9 0.1 Stock options 0.8 0.7 Total 1.7 0.8 |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share Based Compensation [Abstract] | |
Share-Based Compensation | Note 10. Share-Based Compensation The Company’s share-based compensation plan under which it may grant future awards, the Donnelley Financial Solutions, Inc. Amended and Restated 2016 Performance Incentive Plan (“2016 PIP”), was approved by the Board of Directors (the “Board”) and the Company’s shareholders on May 18, 2017, and provides incentives to key employees of the Company. Awards under the 2016 PIP may include cash or stock bonuses, stock options, stock appreciation rights, restricted stock, performance share units (“PSUs”), performance cash awards or restricted stock units (“RSUs”). In addition, non-employee members of the Board may receive awards under the 2016 PIP. On May 30, 2019, the Company’s shareholders voted to approve 3.4 million additional shares of common stock for issuance under the 2016 PIP. At March 31, 2020, there were 1.8 million remaining shares of common stock authorized and available for grant under the 2016 PIP. The Company recognizes compensation expense for the share-based awards based on estimated grant date fair values as well as certain assumptions, as further disclosed in Note 18, Share-Based Compensation , of the Company’s Annual Report. Total compensation expense related to all share-based compensation plans was $2.3 million and $1.5 million for the three months ended March 31, 2020 and 2019, respectively. The income tax benefit related to share-based compensation expense was $0.1 million and $0.4 million, respectively. As of March 31, 2020, $20.8 million of total unrecognized expense related to share-based compensation awards is expected to be recognized over a weighted-average period of 2.4 years. Stock Options There were no stock options granted during the three months ended March 31, 2020. A summary of activity and weighted average exercise prices related to the stock options were as follows: Shares Under Option (thousands) Weighted Average Exercise Price Outstanding at December 31, 2019 796 $ 19.83 Cancelled/forfeited/expired (52 ) 33.52 Outstanding at March 31, 2020 744 $ 18.89 Vested and expected to vest at March 31, 2020 728 $ 18.93 Vested at March 31, 2020 416 $ 20.45 As of March 31, 2020, $1.7 million of unrecognized compensation expense related to stock options is expected to be recognized over a weighted average period of 2.1 years. Restricted Stock Units RSU awards as of December 31, 2019 and March 31, 2020 and changes during the three months ended March 31, 2020, were as follows: Shares (thousands) Weighted Average Grant Date Fair Value Nonvested at December 31, 2019 870 $ 15.79 Granted 911 8.98 Vested (296 ) 17.33 Forfeited (23 ) 12.15 Nonvested at March 31, 2020 1,462 $ 11.30 As of March 31, 2020, $13.9 million of unrecognized compensation expense related to RSUs is expected to be recognized over a weighted-average period of 2.4 years. Performance Share Units PSU awards as of December 31, 2019 and March 31, 2020 and changes during the three months ended March 31, 2020, were as follows: Shares (thousands) Weighted Average Grant Date Fair Value Nonvested at December 31, 2019 537 $ 15.81 Granted 346 8.98 Vested (25 ) 21.40 Nonvested at March 31, 2020 858 $ 12.91 During the three months ended March 31, 2020, 345,900 PSUs were granted to certain executive officers and senior management, payable upon the achievement of certain established performance targets. The total potential payout for awards granted during the three months ended March 31, 2020, ranges from zero to 691,800 shares. Compensation expense related to PSUs granted in 2020, 2019, and 2018 is recognized based on 100%, 66% 43% attainment of the targeted performance metrics or approximately 346,000, 199,000, and 89,000 shares, for each respective period. As of March 31, 2020, $5.2 million of unrecognized compensation expense related to PSUs is expected to be recognized over a weighted average period of 2.4 years. |
Capital Stock
Capital Stock | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Capital Stock | Note 11. Capital Stock The Company has 65 million shares of $0.01 par value common stock for issuance. DFIN’s common stock is currently traded under the ticker symbol “DFIN” on the New York Stock Exchange. The Company has one million shares of $0.01 par value preferred stock authorized for issuance. The Board may divide the preferred stock into one or more series and fix the redemption, dividend, voting, conversion, sinking fund, liquidation and other rights. The Company has no present plans to issue any preferred stock. Common Stock Repurchase —On February 4, 2020, the Board authorized a stock repurchase program, under which the Company is authorized to repurchase up to $25.0 million of its outstanding common stock from time to time in one or more transactions on the open market or in privately negotiated purchases in accordance with all applicable securities laws and regulations and all repurchases in the open market will be made in compliance with Rule 10b-18 under the Exchange Act. The timing and amount of any shares repurchased will be determined by the Company based on its evaluation of market conditions and other factors. Repurchases may also be made under a Rule 10b5-1 plan, which would permit shares to be repurchased when the Company might otherwise be precluded from doing so under insider trading laws. The stock repurchase program will be effective through December 31, 2021, however, it may be suspended or discontinued at any time. During the first quarter of 2020, the Company repurchased 615,896 shares in open market transactions for $3.8 million at an average price of $6.19 per share. As of March 31, 2020, the remaining authorized amount under the current authorization was approximately $21.2 million. |
Comprehensive Income
Comprehensive Income | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Comprehensive Income | Note 12. Comprehensive Income The components of other comprehensive income and income tax expense allocated to each component for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 Before Tax Amount Income Tax Expense Net of Tax Amount Translation adjustments $ (2.8 ) $ — $ (2.8 ) Adjustment for net periodic pension plan and other postretirement benefits plan 0.8 0.2 0.6 Other comprehensive loss $ (2.0 ) $ 0.2 $ (2.2 ) Three Months Ended March 31, 2019 Before Tax Amount Income Tax Expense Net of Tax Amount Translation adjustments $ 2.2 $ — $ 2.2 Adjustment for net periodic pension plan and other postretirement benefits plan 0.6 0.2 0.4 Other comprehensive income $ 2.8 $ 0.2 $ 2.6 Accumulated other comprehensive loss by component as of December 31, 2019 and March 31, 2020 were as follows: Pension and Other Postretirement Benefits Plan Cost Translation Adjustments Total Balance at December 31, 2019 $ (70.9 ) $ (13.7 ) $ (84.6 ) Other comprehensive income before reclassifications — (2.8 ) (2.8 ) Amounts reclassified from accumulated other comprehensive loss 0.6 — 0.6 Net change in accumulated other comprehensive loss 0.6 (2.8 ) (2.2 ) Balance at March 31, 2020 $ (70.3 ) $ (16.5 ) $ (86.8 ) Accumulated other comprehensive loss by component as of December 31, 2018 and March 31, 2019 were as follows: Pension and Other Postretirement Benefits Plan Cost Translation Adjustments Total Balance at December 31, 2018 $ (66.0 ) $ (16.7 ) $ (82.7 ) Other comprehensive income before reclassifications 0.1 2.2 2.3 Amounts reclassified from accumulated other comprehensive loss 0.3 — 0.3 Net change in accumulated other comprehensive loss 0.4 2.2 2.6 Balance at March 31, 2019 $ (65.6 ) $ (14.5 ) $ (80.1 ) Reclassifications from accumulated other comprehensive loss for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, Classification in the Condensed Consolidated Statements of Operations 2020 2019 Amortization of pension and other postretirement benefits plan cost: Net actuarial loss $ 0.8 $ 0.4 (a) Reclassifications before tax 0.8 0.4 Income tax expense 0.2 0.1 Reclassifications, net of tax $ 0.6 $ 0.3 _____________ (a) These accumulated other comprehensive loss components are included in the calculation of net periodic pension and other postretirement benefits plan income recognized in investment and other income, net in the Unaudited Condensed Consolidated Statements of Operations (see Note 6, Retirement Plans |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Note 13. Segment Information In the first quarter of 2020, management realigned the Company’s operating segments to reflect changes in the manner in which the chief operating decision maker assesses information for decision-making purposes. All prior year amounts related to segments have been reclassified to conform to the Company’s current reporting structure. There is no impact on the Company’s previously reported consolidated statements of operations, statements of comprehensive income, balance sheets, statements of cash flows or statements of changes in stockholders’ equity as a result of the new segmentation. The Company operates its business through four operating and reportable segments: Capital Markets – Software Solutions, Capital Markets – Compliance and Communications Management, Investment Companies – Software Solutions, and Investment Companies – Compliance and Communications Management. Corporate Capital Markets The Company provides software solutions, technology-enabled services and print and distribution solutions to public and private companies for deal solutions and compliance to companies that are or preparing to become subject to the filing and reporting requirements of the Securities Act and the Exchange Act. Capital markets’ clients leverage the Company’s software offerings, proprietary technology, deep industry expertise and experience to successfully navigate the SEC’s specified file formats when submitting compliance documents through the EDGAR system for their transactional and ongoing compliance needs. The Company assists its capital markets clients throughout the course of public and private business transactions; mergers and acquisitions, initial public offerings (“IPOs”), debt offerings and other similar transactions. In addition, the Company provides clients with compliance solutions to prepare their ongoing required Exchange Act filings that are compatible with the SEC’s EDGAR system, most notably Form 10-K, Form 10-Q, Form 8-K and Proxy Form DEF 14A. The Company’s operating segments associated with its capital markets services and products offerings are as follows: Capital Markets – Software Solutions— The Company provides software solutions to public and private companies to help manage public and private transaction processes; extract data and analyze contracts; collaborate; and tag, validate and file SEC documents. Capital Markets – Compliance & Communications Management— The Company provides technology-enabled services and print and distribution solutions to public and private companies for deal solutions and SEC compliance requirements. Investment Companies The Company provides software solutions, technology-enabled services and print, distribution and fulfillment solutions to its investment companies clients that are subject to the filing and reporting requirements of the Investment Act, primarily mutual fund companies, alternative investment companies, insurance companies and third-party fund administrators. The Company’s suite of solutions enables its investment company clients to comply with applicable ongoing SEC regulations, as well as to create, manage, and deliver accurate and timely financial communications to investors and regulators. The Company also provides pre- and post-enrollment information to healthcare providers. Investment company clients leverage the Company’s proprietary technology, deep industry expertise and experience to successfully navigate the SEC’s specified file formats when submitting compliance documents through the EDGAR system. The Company’s operating segments associated with its investment companies services and products offerings are as follows: Investment Companies – Software Solutions— The Company provides software solutions that enable clients to store and manage compliance and regulatory information in a self-service, central repository for documents to be easily accessed, assembled, edited, translated, rendered and submitted to regulators. Investment Companies – Compliance & Communications Management— The Company provides its investment company clients technology-enabled solutions to prepare and file registration forms, as well as XBRL-formatted filings pursuant to the Investment Act, through the SEC’s EDGAR system. In addition, the Company provides print and distribution solutions for its clients to communicate with their investors. Corporate Corporate consists of unallocated SG&A activities and associated expenses including, in part, executive, legal, finance, marketing, communications and certain facility costs. In addition, certain costs and earnings of employee benefit plans, such as pension and other postretirement benefit plan expense (income) and share-based compensation, are included in Corporate and are not allocated to the operating segments. Information by Segment The Company has disclosed income (loss) from operations as the primary measure of segment earnings (loss). This is the measure of profitability used by the Company’s chief operating decision maker and is most consistent with the presentation of profitability reported within the condensed consolidated financial statements. Total Net Sales Income (Loss) from Operations Assets (1) Depreciation and Amortization Capital Expenditures Three Months Ended March 31, 2020 Capital Markets - Software Solutions $ 31.2 $ 1.8 $ 163.9 $ 3.1 $ 3.3 Capital Markets - Compliance and Communication Management 99.1 21.4 447.6 4.0 0.2 Investment Companies - Software Solutions 16.1 0.1 98.3 2.9 2.8 Investment Companies - Compliance and Communication Management 74.3 2.1 141.7 2.4 — Total operating segments 220.7 25.4 851.5 12.4 6.3 Corporate — (13.5 ) 83.3 — 0.6 Total $ 220.7 $ 11.9 $ 934.8 $ 12.4 $ 6.9 Total Net Sales Income (Loss) from Operations Assets (1) Depreciation and Amortization Capital Expenditures Three Months Ended March 31, 2019 Capital Markets - Software Solutions $ 30.5 $ 0.1 $ 160.8 $ 3.1 $ 3.3 Capital Markets - Compliance and Communication Management 102.0 14.7 484.1 3.5 1.7 Investment Companies - Software Solutions 14.2 (3.7 ) 105.9 3.4 4.1 Investment Companies - Compliance and Communication Management 82.9 6.7 160.7 2.1 5.9 Total operating segments 229.6 17.8 911.5 12.1 15.0 Corporate — (11.2 ) 90.9 — 0.1 Total $ 229.6 $ 6.6 $ 1,002.4 $ 12.1 $ 15.1 __________________________ (1) Certain assets are recorded within a segment based on predominant usage, however as they benefit more than one segment, the related operating expenses are allocated between segments. Corporate assets primarily consisted of the following items: March 31, 2020 December 31, 2019 Cash and cash equivalents $ 7.7 $ 17.2 Prepaid expenses and other current assets 14.4 11.7 Right-of-use assets 11.0 11.5 Deferred income taxes, net of valuation allowance 9.1 9.0 Other noncurrent assets 34.4 34.2 |
Overview, Basis of Presentati_2
Overview, Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates— The preparation of financial statements in conformity with GAAP requires the extensive use of management’s estimates and assumptions that affect the reported amounts of assets and liabilities as well as disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. The Company’s significant accounting policies and critical estimates are disclosed in the Company’s Annual Report. |
Prepaid Expenses Policy [Policy Text Block] | Prepaid Expenses —As of March 31, 2020 and December 31, 2019, prepaid expenses were $13.8 million and $9.6 million, respectively. |
Inventories | Inventory— The components of the Company’s inventories stated at the lower of cost or market, net of excess and obsolescence reserves for raw materials, at March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Raw materials and manufacturing supplies $ 6.7 $ 3.9 Work in process 8.5 7.2 Total $ 15.2 $ 11.1 |
Software | Software — Capitalized software development costs are amortized over their estimated useful life using the straight-line method, up to a maximum of three years. Amortization expense related to internally-developed software, excluding amortization expense related to other intangible assets, was $7.3 million and $6.9 million for the three months ended March 31, 2020 and 2019 |
Investments | Investments — The carrying value of the Company’s investments in equity securities was $25.2 million at both March 31, 2020 and December 31, 2019. The Company measures its equity securities that do not have a readily determinable fair value, at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The Company performs an assessment on a quarterly basis to determine whether triggering events for impairment exist and to identify any observable price changes. During the three months ended March 31, 2020, there were no events or changes in circumstances that suggested an impairment or an observable price change of any of these investments resulting from an orderly transaction for the identical or a similar investment. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which replaces the incurred loss model with a current expected credit loss (“CECL”) model and requires consideration of a broader range of reasonable and supportable information to explain credit loss estimates. This standard applies to financial assets, measured at amortized cost, including loans, held-to-maturity debt securities, net investments in leases and trade accounts receivable. The guidance must be adopted using a modified retrospective transition method through a cumulative-effect adjustment to retained earnings in the period of adoption. On January 1, 2020, the Company adopted the standard and recorded a $0.5 million cumulative-effect adjustment to retained earnings. The Company’s credit loss reserves primarily relate to trade receivables, unbilled receivables and contract assets. The Company establishes provisions at differing rates, which are region or country-specific, and are based upon the age of the trade receivable, the Company’s historical collection experience in each region or country and lines of business, where appropriate. Provisions for unbilled receivables and contract assets are established based on rates which management believes to be appropriate considering its historical experience. Specific customer provisions are made when a review of significant outstanding amounts, utilizing information about customer creditworthiness and current economic trends, indicates that collection is doubtful. Transactions affecting the current expected credit loss reserve during the three months ended March 31, 2020 were as follows: March 31, 2020 Balance, beginning of year $ 7.7 Adoption of ASU 2016-13 0.5 Provisions charged to expense and reclassifications 2.3 Write-offs and other (0.8 ) Balance, end of period (a) $ 9.7 _____________ (a) As of March 31, 2020, the CECL reserve balance is comprised of an $8.8 million provision for accounts receivable and a $0.9 million provision for unbilled receivables and contract assets, all of which are included in receivables, net on the Unaudited Condensed Consolidated Balance Sheet. As of December 31, 2019, prior to the adoption of ASU 2016-13, the reserve balance was comprised of a $7.7 million allowance for doubtful accounts. I n August 2018, the FASB issued ASU No. 2018-15, “Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40).” The standard requires a customer in a hosting arrangement that is a service contract to follow the internal-use software guidance to determine which implementation costs to capitalize as an asset related to the service contract and to expense the capitalized implementation costs over the term of the hosting arrangement. The standard is effective for fiscal years beginning after December 15, 2019, and the interim periods within those fiscal years. The Company adopted the amendment prospectively on January 1, 2020. The adoption of the standard did not have a material impact on the Company’s condensed consolidated financial statements. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provides optional guidance for a limited period of time to use optional expedients and exceptions for applying U.S. GAAP to contracts and other transactions affected by reference rate reform, if certain criteria are met. The amendments in ASU 2020-04 apply only to contracts and other transactions that reference the London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued due to reference rate reform. Generally, the expedients and exceptions provided by ASU 2020-04 would only be allowed for contract modifications made prior to December 31, 2022. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which modifies ASC 740, Income Taxes, to simplify the accounting for income taxes by removing certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. ASU 2019-12 also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. The Company is currently evaluating the impact the adoption of this standard will have on its condensed consolidated financial statements. |
Revenue Recognition | Revenue Recognition The Company manages highly-customized data and materials, such as filings with the SEC on behalf of its customers pursuant to the Securities Act of 1933, as amended (the “Securities Act”), the Securities Act of 1934, as amended (the “Exchange Act”), and the Securities Act of 1940, as amended (the “Investment Act”), manages virtual data rooms and performs XBRL and related services. Clients are provided with EDGAR filing services, XBRL compliance services and translation, editing, interpreting, proof-reading and multilingual typesetting services, among others. The Company’s software solutions include Venue, the FundSuiteArc software platform, ActiveDisclosure and data and analytics, among others. Substantially all of the Company’s revenue is derived from contracts with an initial expected duration of one year or less. Generally, customer payment is due within ten days upon invoicing. Revenue is recognized upon transfer of control of promised services or products to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services or products. The Company’s arrangements with customers often include promises to transfer multiple services or products to a customer. Determining whether services and products are considered distinct performance obligations that should be accounted for separately requires significant judgment. Certain customer arrangements have multiple performance obligations as certain promises are both capable of being distinct and are distinct within the context of the contract. Other customer arrangements have a single performance obligation as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts, and therefore are not distinct. Revenue for the Company’s tech-enabled services, software solutions and print and distribution offerings is recognized either over time or at a point in time, as outlined below. Over time The Company recognizes revenue for certain services over time: • The Company’s software solutions, including Venue, the FundSuiteArc software platform, ActiveDisclosure, data and analytics and others, are generally provided on a subscription basis and allow customers access to use the products over the contract period. As a result, software solutions revenue is predominantly recognized ratably over time as the customer receives the benefit throughout the contract period. The timing of invoicing varies, however, the customer may be invoiced before the end of the contract period, resulting in a deferred revenue balance. Point in time Certain revenue arrangements, primarily for tech-enabled services and print and distribution offerings, are recognized at a point in time and are primarily invoiced upon completion of all services or upon shipment to the customer. • Certain arrangements include multiple performance obligations and revenue is recognized upon completion of each performance obligation, such as when a document is filed with a regulatory agency and upon completion of printing the related document. For arrangements with multiple performance obligations, the transaction price is allocated to the separate performance obligations. The Company provides customer specific solutions and as such, observable standalone selling price is rarely available. Standalone selling price is determined using an estimate of the standalone selling price of each distinct service or product, taking into consideration historical selling price by customer for each distinct service or product. These estimates may vary from the final amounts invoiced to the customer and are adjusted upon completion of all performance obligations. Customers may be invoiced subsequent to the recognition of revenue for completed performance obligations , resulting in contract asset balances. • Revenue for arrangements which include assisting customers in completing regulatory filings for transactions, such as mergers and acquisitions or other public capital market transactions, is recognized upon completion of all obligations, including the services performed and printing of the related document, if applicable. • Revenue for arrangements without a regulatory filing generally have a single performance obligation. As the services and products provided are not distinct within the context of the contract, the revenue is recognized upon completion of the services performed or upon completion of printing of the related product. • Warehousing, fulfillment services and shipping and handling are each separate performance obligations. As a result, when the Company provides warehousing and future fulfillment services, revenue for the composition services performed and printing of the product is recognized upon completion of the performance obligation(s), as control of the inventory has transferred to the customer and the inventory is being stored at the customer’s request. Because substantially all of the Company’s products are customized, product returns are not significant; however, the Company accrues for the estimated amount of customer credits at the time of sale. The Company records deferred revenue when amounts are invoiced but the revenue recognition criteria are not yet met. Such revenue is recognized when all criteria are subsequently met. Certain revenues earned by the Company require significant judgment to determine if revenue should be recorded gross, as a principal, or net of related costs, as an agent. Billings for shipping and handling costs as well as certain postage costs, and out-of-pocket expenses are recorded gross. Revenue is not recognized for customer-supplied postage. The Company’s printing operations process paper that may be supplied directly by customers or may be purchased by the Company from third parties and sold to customers. Revenue is not recognized for customer-supplied paper, however, revenues for Company-supplied paper are recognized on a gross basis. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to authorities. |
Overview, Basis of Presentati_3
Overview, Basis of Presentation and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Components of Inventories | The components of the Company’s inventories stated at the lower of cost or market, net of excess and obsolescence reserves for raw materials, at March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Raw materials and manufacturing supplies $ 6.7 $ 3.9 Work in process 8.5 7.2 Total $ 15.2 $ 11.1 |
Components of Company's Property, Plant and Equipment | The components of the Company’s property, plant and equipment, net at March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Land $ 0.3 $ 0.3 Buildings 27.1 26.8 Machinery and equipment 112.0 111.9 139.4 139.0 Less: Accumulated depreciation (122.9 ) (121.5 ) Total $ 16.5 $ 17.5 |
Summary of Current Expected Credit Loss Reserve | Transactions affecting the current expected credit loss reserve during the three months ended March 31, 2020 were as follows: March 31, 2020 Balance, beginning of year $ 7.7 Adoption of ASU 2016-13 0.5 Provisions charged to expense and reclassifications 2.3 Write-offs and other (0.8 ) Balance, end of period (a) $ 9.7 _____________ (a) As of March 31, 2020, the CECL reserve balance is comprised of an $8.8 million provision for accounts receivable and a $0.9 million provision for unbilled receivables and contract assets, all of which are included in receivables, net on the Unaudited Condensed Consolidated Balance Sheet. As of December 31, 2019, prior to the adoption of ASU 2016-13, the reserve balance was comprised of a $7.7 million allowance for doubtful accounts. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue Recognition [Abstract] | |
Schedule of Disaggregation of Revenue by Reporting Unit and Timing of Revenue Recognition | The following table disaggregates revenue between tech-enabled services, software solutions and print and distribution by reportable segment: Three Months Ended March 31, 2020 2019 Tech-enabled Services Software Solutions Print and Distribution Total Tech-enabled Services Software Solutions Print and Distribution Total Capital Markets - Software Solutions $ — $ 31.2 $ — $ 31.2 $ — $ 30.5 $ — $ 30.5 Capital Markets - Compliance and Communications Management 57.9 — 41.2 99.1 59.5 — 42.5 102.0 Investment Companies - Software Solutions — 16.1 — 16.1 — 14.2 — 14.2 Investment Companies - Compliance and Communications Management 24.0 — 50.3 74.3 23.7 — 59.2 82.9 Total net sales $ 81.9 $ 47.3 $ 91.5 $ 220.7 $ 83.2 $ 44.7 $ 101.7 $ 229.6 |
Changes in Contract Liabilities | Contract liabilities consist of deferred revenue and progress billings which are included in accrued liabilities on the Unaudited Condensed Consolidated Balance Sheets. Changes in contract liabilities for the three months ended March 31, 2020 and 2019, respectively, were as follows: Balance at January 1, 2020 $ 13.1 Deferral of revenue 11.2 Revenue recognized (9.6 ) Balance at March 31, 2020 $ 14.7 Balance at January 1, 2019 $ 12.0 Deferral of revenue 12.2 Revenue recognized (12.6 ) Balance at March 31, 2019 $ 11.6 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Balances of Goodwill by Segment | The balances of goodwill by segment are presented below: March 31, 2020 Capital Markets - Software Solutions $ 103.6 Capital Markets - Compliance and Communication Management 252.5 Investment Companies - Software Solutions 53.0 Investment Companies - Compliance and Communication Management 40.6 Total $ 449.7 |
Components of Other Intangible Assets | The components of other intangible assets at March 31, 2020 and December 31, 2019 were as follows: March 31, 2020 December 31, 2019 Gross Carrying Amount Accumulated Impairment Charges Accumulated Amortization Net Book Value Gross Carrying Amount Accumulated Impairment Charges Accumulated Amortization Net Book Value Customer relationships (useful life of 10- 15 years $ 148.6 $ (1.0 ) $ (130.0 ) $ 17.6 $ 149.8 $ (1.0 ) $ (127.7 ) $ 21.1 Trade names (useful life of 5 years 3.9 — (3.1 ) 0.8 3.9 — (3.1 ) 0.8 Total other intangible assets $ 152.5 $ (1.0 ) $ (133.1 ) $ 18.4 $ 153.7 $ (1.0 ) $ (130.8 ) $ 21.9 |
Schedule of Estimated Annual Amortization Expense Related to Other Intangible Assets | The following table outlines the estimated annual amortization expense related to other intangible assets: For the year ending December 31, Amount 2020 (excluding the three months ended March 31, 2020) $ 8.9 2021 0.9 2022 0.9 2023 0.9 2024 0.7 2025 and thereafter 6.1 Total $ 18.4 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Summary of Components of Lease Expense | The components of lease expense for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Operating lease expense $ 6.7 $ 6.8 Sublease income (1.3 ) (0.8 ) Net lease expense $ 5.4 $ 6.0 |
Summary of Company's Lease Liabilities in Condensed Consolidated Balance Sheets | The Company’s lease liabilities are presented within the Company’s Unaudited Condensed Consolidated Balance Sheets as follows: March 31, 2020 December 31, 2019 Accrued liabilities $ 22.1 $ 22.6 Noncurrent lease liabilities 57.8 57.9 Total $ 79.9 $ 80.5 |
Restructuring, Impairment and_2
Restructuring, Impairment and Other Charges (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Restructuring And Related Activities [Abstract] | |
Schedule of Restructuring, Impairment and Other Charges Recognized in Results of Operations | For the three months ended March 31, 2020 and 2019, the Company recorded the following net restructuring and other charges: Three Months Ended March 31, 2020 Total Restructuring Charges Other Charges Total Capital Markets - Software Solutions $ 0.3 $ — $ 0.3 Capital Markets - Compliance and Communication Management 0.4 0.1 0.5 Investment Companies - Software Solutions 0.3 — 0.3 Investment Companies - Compliance and Communication Management 0.4 — 0.4 Corporate 0.2 1.4 1.6 Total $ 1.6 $ 1.5 $ 3.1 Three Months Ended March 31, 2019 Total Restructuring Charges Other Charges Total Capital Markets - Software Solutions $ 0.3 $ — $ 0.3 Capital Markets - Compliance and Communication Management 0.8 0.1 0.9 Investment Companies - Software Solutions 0.1 — 0.1 Investment Companies - Compliance and Communication Management 0.4 — 0.4 Corporate 0.4 — 0.4 Total $ 2.0 $ 0.1 $ 2.1 |
Schedule of Changes in the Restructuring Reserve | The restructuring reserve as of December 31, 2019 and March 31, 2020, and changes during the three months ended March 31, 2020, were as follows: December 31, 2019 Restructuring Charges Reversals Cash Paid March 31, 2020 Employee terminations $ 1.9 $ 1.7 $ (0.1 ) $ (1.6 ) $ 1.9 |
Retirement Plans (Tables)
Retirement Plans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Compensation And Retirement Disclosure [Abstract] | |
Components of Estimated Net Pension Plan Income | The components of the estimated net pension plan income for the Company’s pension plans for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Interest cost $ 2.2 $ 2.8 Expected return on assets (3.5 ) (3.7 ) Amortization, net 0.8 0.4 Net pension income $ (0.5 ) $ (0.5 ) |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of the Company's Debt | The Company’s debt as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, 2020 December 31, 2019 8.25% senior notes due October 15, 2024 $ 233.5 $ 300.0 Borrowings under the Revolving Facility 106.0 — Unamortized debt issuance costs (2.9 ) (4.0 ) Total long-term debt $ 336.6 $ 296.0 |
Summary of Interest Expense, Net | The following table summarizes interest expense, net included in the Unaudited Condensed Consolidated Statements of Operations Three Months Ended March 31, 2020 2019 Interest incurred $ 6.9 $ 8.9 Less: Gain on debt extinguishment (2.3 ) — Interest expense, net $ 4.6 $ 8.9 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Reconciliation of Numerator and Denominator of Basic and Diluted Earnings (Loss) per Share Calculation and Anti-dilutive Share-based Awards | The reconciliation of the numerator and denominator of the basic and diluted earnings (loss) per share calculation and the anti-dilutive share-based awards for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 2019 Net earnings (loss) per share: Basic $ 0.12 $ (0.04 ) Diluted $ 0.12 $ (0.04 ) Numerator: Net earnings (loss) $ 4.1 $ (1.4 ) Denominator: Weighted average number of common shares outstanding 34.2 34.0 Dilutive awards 0.1 — Diluted weighted average number of common shares outstanding 34.3 34.0 Weighted average number of anti-dilutive share-based awards: Restricted stock units 0.9 0.1 Stock options 0.8 0.7 Total 1.7 0.8 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share Based Compensation [Abstract] | |
Summary of Activity and Weighted Average Exercise Prices Related To Stock Options | A summary of activity and weighted average exercise prices related to the stock options were as follows: Shares Under Option (thousands) Weighted Average Exercise Price Outstanding at December 31, 2019 796 $ 19.83 Cancelled/forfeited/expired (52 ) 33.52 Outstanding at March 31, 2020 744 $ 18.89 Vested and expected to vest at March 31, 2020 728 $ 18.93 Vested at March 31, 2020 416 $ 20.45 |
Summary of Nonvested Restricted Stock Unit Awards | RSU awards as of December 31, 2019 and March 31, 2020 and changes during the three months ended March 31, 2020, were as follows: Shares (thousands) Weighted Average Grant Date Fair Value Nonvested at December 31, 2019 870 $ 15.79 Granted 911 8.98 Vested (296 ) 17.33 Forfeited (23 ) 12.15 Nonvested at March 31, 2020 1,462 $ 11.30 |
Summary of Nonvested Performance Share Units | PSU awards as of December 31, 2019 and March 31, 2020 and changes during the three months ended March 31, 2020, were as follows: Shares (thousands) Weighted Average Grant Date Fair Value Nonvested at December 31, 2019 537 $ 15.81 Granted 346 8.98 Vested (25 ) 21.40 Nonvested at March 31, 2020 858 $ 12.91 |
Comprehensive Income (Tables)
Comprehensive Income (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Schedule of Components of Other Comprehensive Income and Income Tax Expense Allocated to Each Component | The components of other comprehensive income and income tax expense allocated to each component for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, 2020 Before Tax Amount Income Tax Expense Net of Tax Amount Translation adjustments $ (2.8 ) $ — $ (2.8 ) Adjustment for net periodic pension plan and other postretirement benefits plan 0.8 0.2 0.6 Other comprehensive loss $ (2.0 ) $ 0.2 $ (2.2 ) Three Months Ended March 31, 2019 Before Tax Amount Income Tax Expense Net of Tax Amount Translation adjustments $ 2.2 $ — $ 2.2 Adjustment for net periodic pension plan and other postretirement benefits plan 0.6 0.2 0.4 Other comprehensive income $ 2.8 $ 0.2 $ 2.6 |
Schedule of Changes in Accumulated Other Comprehensive Loss | Accumulated other comprehensive loss by component as of December 31, 2019 and March 31, 2020 were as follows: Pension and Other Postretirement Benefits Plan Cost Translation Adjustments Total Balance at December 31, 2019 $ (70.9 ) $ (13.7 ) $ (84.6 ) Other comprehensive income before reclassifications — (2.8 ) (2.8 ) Amounts reclassified from accumulated other comprehensive loss 0.6 — 0.6 Net change in accumulated other comprehensive loss 0.6 (2.8 ) (2.2 ) Balance at March 31, 2020 $ (70.3 ) $ (16.5 ) $ (86.8 ) Accumulated other comprehensive loss by component as of December 31, 2018 and March 31, 2019 were as follows: Pension and Other Postretirement Benefits Plan Cost Translation Adjustments Total Balance at December 31, 2018 $ (66.0 ) $ (16.7 ) $ (82.7 ) Other comprehensive income before reclassifications 0.1 2.2 2.3 Amounts reclassified from accumulated other comprehensive loss 0.3 — 0.3 Net change in accumulated other comprehensive loss 0.4 2.2 2.6 Balance at March 31, 2019 $ (65.6 ) $ (14.5 ) $ (80.1 ) |
Reclassifications from Accumulated Other Comprehensive Loss, Amortization of Pension Plan Cost | Reclassifications from accumulated other comprehensive loss for the three months ended March 31, 2020 and 2019 were as follows: Three Months Ended March 31, Classification in the Condensed Consolidated Statements of Operations 2020 2019 Amortization of pension and other postretirement benefits plan cost: Net actuarial loss $ 0.8 $ 0.4 (a) Reclassifications before tax 0.8 0.4 Income tax expense 0.2 0.1 Reclassifications, net of tax $ 0.6 $ 0.3 _____________ (a) These accumulated other comprehensive loss components are included in the calculation of net periodic pension and other postretirement benefits plan income recognized in investment and other income, net in the Unaudited Condensed Consolidated Statements of Operations (see Note 6, Retirement Plans |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The Company has disclosed income (loss) from operations as the primary measure of segment earnings (loss). This is the measure of profitability used by the Company’s chief operating decision maker and is most consistent with the presentation of profitability reported within the condensed consolidated financial statements. Total Net Sales Income (Loss) from Operations Assets (1) Depreciation and Amortization Capital Expenditures Three Months Ended March 31, 2020 Capital Markets - Software Solutions $ 31.2 $ 1.8 $ 163.9 $ 3.1 $ 3.3 Capital Markets - Compliance and Communication Management 99.1 21.4 447.6 4.0 0.2 Investment Companies - Software Solutions 16.1 0.1 98.3 2.9 2.8 Investment Companies - Compliance and Communication Management 74.3 2.1 141.7 2.4 — Total operating segments 220.7 25.4 851.5 12.4 6.3 Corporate — (13.5 ) 83.3 — 0.6 Total $ 220.7 $ 11.9 $ 934.8 $ 12.4 $ 6.9 Total Net Sales Income (Loss) from Operations Assets (1) Depreciation and Amortization Capital Expenditures Three Months Ended March 31, 2019 Capital Markets - Software Solutions $ 30.5 $ 0.1 $ 160.8 $ 3.1 $ 3.3 Capital Markets - Compliance and Communication Management 102.0 14.7 484.1 3.5 1.7 Investment Companies - Software Solutions 14.2 (3.7 ) 105.9 3.4 4.1 Investment Companies - Compliance and Communication Management 82.9 6.7 160.7 2.1 5.9 Total operating segments 229.6 17.8 911.5 12.1 15.0 Corporate — (11.2 ) 90.9 — 0.1 Total $ 229.6 $ 6.6 $ 1,002.4 $ 12.1 $ 15.1 __________________________ (1) Certain assets are recorded within a segment based on predominant usage, however as they benefit more than one segment, the related operating expenses are allocated between segments. |
Schedule of Corporate Assets | Corporate assets primarily consisted of the following items: March 31, 2020 December 31, 2019 Cash and cash equivalents $ 7.7 $ 17.2 Prepaid expenses and other current assets 14.4 11.7 Right-of-use assets 11.0 11.5 Deferred income taxes, net of valuation allowance 9.1 9.0 Other noncurrent assets 34.4 34.2 |
Overview, Basis of Presentati_4
Overview, Basis of Presentation and Significant Accounting Policies - Additional Information (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020USD ($)Segment | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Number of operating segments | Segment | 4 | ||
Prepaid expenses | $ 13.8 | $ 9.6 | |
Depreciation expense | 1.7 | $ 1.5 | |
Real estate property held-for-sale carrying value | 5.6 | 5.6 | |
Equity investments carrying value | 25.2 | $ 25.2 | |
Computer Software, Intangible Asset | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Amortization expense related to internally-developed software | $ 7.3 | $ 6.9 | |
Maximum | Computer Software, Intangible Asset | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Estimated useful life of computer software | 3 years |
Overview, Basis of Presentati_5
Overview, Basis of Presentation and Significant Accounting Policies- Components of Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory Net [Abstract] | ||
Raw materials and manufacturing supplies | $ 6.7 | $ 3.9 |
Work in process | 8.5 | 7.2 |
Total | $ 15.2 | $ 11.1 |
Overview, Basis of Presentati_6
Overview, Basis of Presentation and Significant Accounting Policies - Components of Company's Property, Plant and Equipment (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 139.4 | $ 139 |
Less: Accumulated depreciation | (122.9) | (121.5) |
Total | 16.5 | 17.5 |
Land | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 0.3 | 0.3 |
Buildings | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 27.1 | 26.8 |
Machinery and Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 112 | $ 111.9 |
Overview, Basis of Presentati_7
Overview, Basis of Presentation and Significant Accounting Policies - Summary of Current Expected Credit Loss Reserve (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Financing Receivable Allowance For Credit Losses [Line Items] | |
Balance, beginning of year | $ 7.7 |
Provisions charged to expense and reclassifications | 2.3 |
Write-offs and other | (0.8) |
Balance, end of period (a) | 9.7 |
ASU 2016-13 | |
Financing Receivable Allowance For Credit Losses [Line Items] | |
Adoption of ASU 2016-13 | $ 0.5 |
Overview, Basis of Presentati_8
Overview, Basis of Presentation and Significant Accounting Policies - Summary of Current Expected Credit Loss Reserve (Parenthetical) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Receivables [Abstract] | ||
Accounts and Financing Receivable, Allowance for Credit Loss | $ 8.8 | |
Provision of unbilled receivables and contract assets | 0.9 | |
Receivables, allowance for doubtful accounts | $ 9.7 | $ 7.7 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Revenue Recognition [Abstract] | ||
Period due on customer payment upon invoicing | 10 days | |
Unbilled receivables | $ 76 | $ 33.5 |
Contract assets | 14.5 | $ 8.9 |
Invoiced to customers amount that exceeded estimates of standalone selling price | $ 0.1 |
Revenue - Schedule of Disaggreg
Revenue - Schedule of Disaggregation of Revenue by Reporting Unit and Timing of Revenue Recognition (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total net sales | $ 220.7 | $ 229.6 |
Capital Markets - Software Solutions | ||
Total net sales | 31.2 | 30.5 |
Capital Markets - Compliance and Communications Management | ||
Total net sales | 99.1 | 102 |
Investment Companies - Software Solutions | ||
Total net sales | 16.1 | 14.2 |
Investment Companies - Compliance and Communications Management | ||
Total net sales | 74.3 | 82.9 |
Tech-enabled Services | ||
Total net sales | 81.9 | 83.2 |
Tech-enabled Services | Capital Markets - Software Solutions | ||
Total net sales | 0 | 0 |
Tech-enabled Services | Capital Markets - Compliance and Communications Management | ||
Total net sales | 57.9 | 59.5 |
Tech-enabled Services | Investment Companies - Software Solutions | ||
Total net sales | 0 | 0 |
Tech-enabled Services | Investment Companies - Compliance and Communications Management | ||
Total net sales | 24 | 23.7 |
Software Solutions | ||
Total net sales | 47.3 | 44.7 |
Software Solutions | Capital Markets - Software Solutions | ||
Total net sales | 31.2 | 30.5 |
Software Solutions | Capital Markets - Compliance and Communications Management | ||
Total net sales | 0 | 0 |
Software Solutions | Investment Companies - Software Solutions | ||
Total net sales | 16.1 | 14.2 |
Software Solutions | Investment Companies - Compliance and Communications Management | ||
Total net sales | 0 | 0 |
Print and Distribution | ||
Total net sales | 91.5 | 101.7 |
Print and Distribution | Capital Markets - Software Solutions | ||
Total net sales | 0 | 0 |
Print and Distribution | Capital Markets - Compliance and Communications Management | ||
Total net sales | 41.2 | 42.5 |
Print and Distribution | Investment Companies - Software Solutions | ||
Total net sales | 0 | 0 |
Print and Distribution | Investment Companies - Compliance and Communications Management | ||
Total net sales | $ 50.3 | $ 59.2 |
Revenue - Changes in Contract L
Revenue - Changes in Contract Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement Of Financial Position [Abstract] | ||
Balance beginning | $ 13.1 | $ 12 |
Deferral of revenue | 11.2 | 12.2 |
Revenue recognized | (9.6) | (12.6) |
Balance ending | $ 14.7 | $ 11.6 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Additional Information (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020USD ($)SegmentReportingUnit | Mar. 31, 2019USD ($) | Dec. 31, 2019ReportingUnit | |
Goodwill And Intangible Assets Disclosure [Abstract] | |||
Number of operating segments | Segment | 4 | ||
Number of reportable units | ReportingUnit | 4 | 3 | |
Goodwill impairment | $ 0 | ||
Amortization expense for other intangible assets | $ 3,400,000 | $ 3,700,000 | |
Weighted-average remaining useful life for unamortized intangible assets | 7 years |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Balances of Goodwill by Segment (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Goodwill [Line Items] | ||
Goodwill | $ 449.7 | $ 450.3 |
Capital Markets - Software Solutions | ||
Goodwill [Line Items] | ||
Goodwill | 103.6 | |
Capital Markets - Compliance and Communications Management | ||
Goodwill [Line Items] | ||
Goodwill | 252.5 | |
Investment Companies - Software Solutions | ||
Goodwill [Line Items] | ||
Goodwill | 53 | |
Investment Companies - Compliance and Communications Management | ||
Goodwill [Line Items] | ||
Goodwill | $ 40.6 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Components of Other Intangible Assets (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 152.5 | $ 153.7 |
Accumulated Impairment Charges | (1) | (1) |
Accumulated Amortization | (133.1) | (130.8) |
Total Net Book Value | 18.4 | 21.9 |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 148.6 | 149.8 |
Accumulated Impairment Charges | (1) | (1) |
Accumulated Amortization | (130) | (127.7) |
Total Net Book Value | 17.6 | 21.1 |
Trade Names | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 3.9 | 3.9 |
Accumulated Impairment Charges | 0 | 0 |
Accumulated Amortization | (3.1) | (3.1) |
Total Net Book Value | $ 0.8 | $ 0.8 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Components of Other Intangible Assets (Parenthetical) (Detail) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Trade Names | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated useful life of computer software | 5 years | 5 years |
Minimum | Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated useful life of computer software | 10 years | 10 years |
Maximum | Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated useful life of computer software | 15 years | 15 years |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets - Schedule of Estimated Annual Amortization Expense Related to Other Intangible Assets (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
2020 (excluding the three months ended March 31, 2020) | $ 8.9 | |
2021 | 0.9 | |
2022 | 0.9 | |
2023 | 0.9 | |
2024 | 0.7 | |
2025 and thereafter | 6.1 | |
Total Net Book Value | $ 18.4 | $ 21.9 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Operating lease payments | $ 6.8 | $ 6.6 |
Leases - Summary of Components
Leases - Summary of Components of Lease Expense (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Operating lease expense | $ 6.7 | $ 6.8 |
Sublease income | (1.3) | (0.8) |
Net lease expense | $ 5.4 | $ 6 |
Leases - Summary of Company's L
Leases - Summary of Company's Lease Liabilities in Condensed Consolidated Balance Sheets (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Accrued liabilities | $ 22.1 | $ 22.6 |
Operating lease liabilities, balance sheet line item | us-gaap:AccruedLiabilitiesCurrent | us-gaap:AccruedLiabilitiesCurrent |
Noncurrent lease liabilities | $ 57.8 | $ 57.9 |
Present value of lease liabilities | $ 79.9 | $ 80.5 |
Restructuring, Impairment and_3
Restructuring, Impairment and Other Charges - Schedule of Restructuring, Impairment and Other Charges Recognized in Results of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Restructuring Cost And Reserve [Line Items] | ||
Total Restructuring Charges | $ 1.6 | $ 2 |
Other Charges | 1.5 | 0.1 |
Total | 3.1 | 2.1 |
Operating Segments | Capital Markets - Software Solutions | ||
Restructuring Cost And Reserve [Line Items] | ||
Total Restructuring Charges | 0.3 | 0.3 |
Other Charges | 0 | 0 |
Total | 0.3 | 0.3 |
Operating Segments | Capital Markets - Compliance and Communications Management | ||
Restructuring Cost And Reserve [Line Items] | ||
Total Restructuring Charges | 0.4 | 0.8 |
Other Charges | 0.1 | 0.1 |
Total | 0.5 | 0.9 |
Operating Segments | Investment Companies - Software Solutions | ||
Restructuring Cost And Reserve [Line Items] | ||
Total Restructuring Charges | 0.3 | 0.1 |
Other Charges | 0 | 0 |
Total | 0.3 | 0.1 |
Operating Segments | Investment Companies - Compliance and Communications Management | ||
Restructuring Cost And Reserve [Line Items] | ||
Total Restructuring Charges | 0.4 | 0.4 |
Other Charges | 0 | 0 |
Total | 0.4 | 0.4 |
Corporate | ||
Restructuring Cost And Reserve [Line Items] | ||
Total Restructuring Charges | 0.2 | 0.4 |
Other Charges | 1.4 | 0 |
Total | $ 1.6 | $ 0.4 |
Restructuring, Impairment and_4
Restructuring, Impairment and Other Charges - Additional Information (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2020USD ($)Employee | Mar. 31, 2019USD ($)Employee | |
Restructuring And Related Activities [Abstract] | ||
Employee termination costs | $ 1.6 | $ 2 |
Number of employees used to determine employee termination costs | Employee | 51 | 72 |
Other charges | $ 1.5 | $ 0.1 |
Restructuring, Impairment and_5
Restructuring, Impairment and Other Charges - Schedule of Changes in the Restructuring Reserve (Details) - Employee terminations $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Restructuring Cost And Reserve [Line Items] | |
Balance at the beginning | $ 1.9 |
Restructuring Charges | 1.7 |
Reversals | (0.1) |
Cash Paid | (1.6) |
Balance at the end | $ 1.9 |
Restructuring, Impairment and_6
Restructuring, Impairment and Other Charges - Restructuring Reserve - Additional Information (Details) $ in Millions | Mar. 31, 2020USD ($) |
Accrued Liabilities | |
Restructuring Cost And Reserve [Line Items] | |
Current restructuring reserve (included in accrued liabilities) | $ 1.8 |
Contract Termination | Other Noncurrent Liabilities | |
Restructuring Cost And Reserve [Line Items] | |
Noncurrent restructuring reserve (included in other noncurrent liabilities) | $ 0.1 |
Retirement Plans - Components o
Retirement Plans - Components of Estimated Net Pension Plan Income (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Net pension income | $ (0.5) | $ (0.5) |
Pension Plan | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Interest cost | 2.2 | 2.8 |
Expected return on assets | (3.5) | (3.7) |
Amortization, net | 0.8 | 0.4 |
Net pension income | $ (0.5) | $ (0.5) |
Debt - Schedule of the Company'
Debt - Schedule of the Company's Debt (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Unamortized debt issuance costs | $ (2.9) | $ (4) |
Total long-term debt | 336.6 | 296 |
8.25% Senior Notes Due October 15, 2024 | ||
Debt Instrument [Line Items] | ||
Senior Unsecured notes | 233.5 | 300 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Borrowings under the Revolving Facility | $ 106 | $ 0 |
Debt - Schedule of the Compan_2
Debt - Schedule of the Company's Debt (Parenthetical) (Details) - 8.25% Senior Notes Due October 15, 2024 | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Interest rate, stated percentage | 8.25% | 8.25% |
Maturity date | Oct. 15, 2024 | Oct. 15, 2024 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Dec. 18, 2018 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Sep. 30, 2016 |
Debt Instrument [Line Items] | |||||
Pre-tax gain on extinguishment of debt | $ 2,300,000 | $ 0 | |||
Senior Secured Term Loan B Facility | |||||
Debt Instrument [Line Items] | |||||
Credit facility | $ 350,000,000 | ||||
Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Credit facility | 300,000,000 | ||||
Borrowings under the Revolving Facility | $ 106,000,000 | $ 0 | |||
Weighted average interest rate on borrowing | 3.80% | 5.10% | |||
Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Allowable annual dividend payment under credit agreement | $ 20,000,000 | ||||
8.25% Senior Notes Due October 15, 2024 | |||||
Debt Instrument [Line Items] | |||||
Interest rate, stated percentage | 8.25% | 8.25% | |||
Maturity date | Oct. 15, 2024 | Oct. 15, 2024 | |||
Fair value of senior notes | $ 212,000,000 | $ 308,400,000 | |||
Notional amount of notes | $ 66,500,000 | ||||
Average purchase and retired price of notes | $ 95.25 | ||||
Pre-tax gain on extinguishment of debt | $ 2,300,000 | ||||
Frequency of interest payable | interest payable semi-annually on April 15 and October 15 | ||||
Second Amended Credit Agreement | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, extended maturity date | Dec. 18, 2023 |
Debt - Summary of Interest Expe
Debt - Summary of Interest Expense, Net (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Debt Instruments [Abstract] | ||
Interest incurred | $ 6.9 | $ 8.9 |
Less: Gain on debt extinguishment | (2.3) | 0 |
Interest expense, net | $ 4.6 | $ 8.9 |
Earnings per Share - Reconcilia
Earnings per Share - Reconciliation of Numerator and Denominator of Basic and Diluted Earnings (Loss) per Share Calculation and Anti-dilutive Share-based Awards (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share Basic And Diluted [Line Items] | ||
Basic | $ 0.12 | $ (0.04) |
Diluted | $ 0.12 | $ (0.04) |
Net earnings (loss) | $ 4.1 | $ (1.4) |
Weighted average number of common shares outstanding | 34.2 | 34 |
Dilutive awards | 0.1 | 0 |
Diluted weighted average number of common shares outstanding | 34.3 | 34 |
Total weighted average number of anti-dilutive share-based awards | 1.7 | 0.8 |
Restricted stock units | ||
Earnings Per Share Basic And Diluted [Line Items] | ||
Total weighted average number of anti-dilutive share-based awards | 0.9 | 0.1 |
Stock options | ||
Earnings Per Share Basic And Diluted [Line Items] | ||
Total weighted average number of anti-dilutive share-based awards | 0.8 | 0.7 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Details) - USD ($) $ in Millions | May 30, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Additional shares of common stock authorized | 3,400,000 | ||||
Shares authorized and available for grant | 1,800,000 | ||||
Share-based compensation | $ 2.3 | $ 1.5 | |||
Share-based compensation expense, income tax benefit | 0.1 | $ 0.4 | |||
Unrecognized share-based compensation expense | $ 20.8 | ||||
Unrecognized share-based compensation expense, vest over weighted-average period | 2 years 4 months 24 days | ||||
Stock options, granted | 0 | ||||
Stock options | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unrecognized share-based compensation expense | $ 1.7 | ||||
Unrecognized share-based compensation expense, vest over weighted-average period | 2 years 1 month 6 days | ||||
RSUs | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unrecognized share-based compensation expense | $ 13.9 | ||||
Unrecognized share-based compensation expense, vest over weighted-average period | 2 years 4 months 24 days | ||||
Share-based compensation award, granted | 911,000 | ||||
Performance share units | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unrecognized share-based compensation expense | $ 5.2 | ||||
Unrecognized share-based compensation expense, vest over weighted-average period | 2 years 4 months 24 days | ||||
Share-based compensation award, granted | 346,000 | ||||
Share-based compensation expense, targeted performance percentage | 100.00% | 66.00% | 43.00% | ||
Number of shares used to determine compensation expense for granted PSUs | 346,000 | 199,000 | 89,000 | ||
Performance share units | Executive Officers and Senior Management | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Share-based compensation award, granted | 345,900 | ||||
Performance share units | Minimum [Member] | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Potential payout for awards | 0 | ||||
Performance share units | Maximum | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Potential payout for awards | 691,800 |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Activity and Weighted Average Exercise Prices Related To Stock Options (Details) shares in Thousands | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Shares Under Option | |
Outstanding at beginning of period | shares | 796 |
Cancelled/forfeited/expired | shares | (52) |
Outstanding at end of period | shares | 744 |
Vested and expected to vest at end of period | shares | 728 |
Vested at end of period | shares | 416 |
Weighted Average Exercise Price | |
Outstanding at beginning of period | $ / shares | $ 19.83 |
Cancelled/forfeited/expired | $ / shares | 33.52 |
Outstanding at end of period | $ / shares | 18.89 |
Vested and expected to vest at end of period | $ / shares | 18.93 |
Vested at end of period | $ / shares | $ 20.45 |
Share-Based Compensation - Su_2
Share-Based Compensation - Summary of Nonvested Restricted Stock Unit Awards (Details) - RSUs shares in Thousands | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Nonvested at beginning of period, Shares | shares | 870 |
Granted, Shares | shares | 911 |
Vested, Shares | shares | (296) |
Forfeited, Shares | shares | (23) |
Nonvested at end of period, Shares | shares | 1,462 |
Nonvested at beginning of period, Weighted Average Grant Date Fair Value | $ / shares | $ 15.79 |
Granted, Weighted Average Grant Date Fair Value | $ / shares | 8.98 |
Vested, Weighted Average Grant Date Fair Value | $ / shares | 17.33 |
Forfeited, Weighted Average Grant Date Fair Value | $ / shares | 12.15 |
Nonvested at end of period, Weighted Average Grant Date Fair Value | $ / shares | $ 11.30 |
Share-Based Compensation - Su_3
Share-Based Compensation - Summary of Nonvested Performance Share Units (Details) - Performance share units shares in Thousands | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Nonvested at beginning of period, Shares | shares | 537 |
Granted, Shares | shares | 346 |
Vested, Shares | shares | (25) |
Nonvested at end of period, Shares | shares | 858 |
Nonvested at beginning of period, Weighted Average Grant Date Fair Value | $ / shares | $ 15.81 |
Granted, Weighted Average Grant Date Fair Value | $ / shares | 8.98 |
Vested, Weighted Average Grant Date Fair Value | $ / shares | 21.40 |
Nonvested at end of period, Weighted Average Grant Date Fair Value | $ / shares | $ 12.91 |
Capital Stock - Additional Info
Capital Stock - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Feb. 04, 2020 | Dec. 31, 2019 | |
Class Of Stock [Line Items] | |||
Common stock, Authorized | 65,000,000 | 65,000,000 | |
Common stock, par value | $ 0.01 | $ 0.01 | |
Preferred stock, authorized | 1,000,000 | 1,000,000 | |
Preferred stock, par value | $ 0.01 | $ 0.01 | |
Outstanding common stock value authorized to repurchase under stock repurchase program | $ 21,200,000 | ||
Repurchases of common stock, shares | 615,896 | ||
Repurchases of common stock, value | $ 3,800,000 | ||
Shares repurchased average price | $ 6.19 | ||
Common Stock | |||
Class Of Stock [Line Items] | |||
Outstanding common stock value authorized to repurchase under stock repurchase program | $ 25,000,000 |
Comprehensive Income - Schedule
Comprehensive Income - Schedule of Components of Other Comprehensive Income and Income Tax Expense Allocated to Each Component (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Other comprehensive (loss) income, Before Tax Amount | $ (2) | $ 2.8 |
Other comprehensive (loss) income, Income Tax Expense | 0.2 | 0.2 |
Other comprehensive (loss) income, net of tax | (2.2) | 2.6 |
Translation adjustments | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Other comprehensive (loss) income, Before Tax Amount | (2.8) | 2.2 |
Other comprehensive (loss) income, Income Tax Expense | 0 | 0 |
Other comprehensive (loss) income, net of tax | (2.8) | 2.2 |
Adjustment for Net Periodic Pension Plan and Other Postretirement Benefits Plan | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Other comprehensive (loss) income, Before Tax Amount | 0.8 | 0.6 |
Other comprehensive (loss) income, Income Tax Expense | 0.2 | 0.2 |
Other comprehensive (loss) income, net of tax | $ 0.6 | $ 0.4 |
Comprehensive Income - Schedu_2
Comprehensive Income - Schedule of Changes in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Balance | $ 268.6 | $ 226 |
Balance | 267.1 | 227.5 |
Pension and Other Postretirement Benefits Plan Cost | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Balance | (70.9) | (66) |
Other comprehensive income before reclassifications | 0 | 0.1 |
Amounts reclassified from accumulated other comprehensive loss | 0.6 | 0.3 |
Net change in accumulated other comprehensive loss | 0.6 | 0.4 |
Balance | (70.3) | (65.6) |
Translation adjustments | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Balance | (13.7) | (16.7) |
Other comprehensive income before reclassifications | (2.8) | 2.2 |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 |
Net change in accumulated other comprehensive loss | (2.8) | 2.2 |
Balance | (16.5) | (14.5) |
Accumulated Other Comprehensive Loss | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Balance | (84.6) | (82.7) |
Other comprehensive income before reclassifications | (2.8) | 2.3 |
Amounts reclassified from accumulated other comprehensive loss | 0.6 | 0.3 |
Net change in accumulated other comprehensive loss | (2.2) | 2.6 |
Balance | $ (86.8) | $ (80.1) |
Comprehensive Income - Reclassi
Comprehensive Income - Reclassifications from Accumulated Other Comprehensive Loss Amortization of Pension Plan Cost (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
Accumulated Defined Benefit Plans Adjustment, Net Actuarial loss | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||
Amortization of pension and other postretirement benefits plan cost: Reclassifications before tax | $ 0.8 | $ 0.4 | [1] |
Pension and Other Postretirement Benefits Plan Cost | |||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||
Amortization of pension and other postretirement benefits plan cost: Reclassifications before tax | 0.8 | 0.4 | |
Income tax expense | 0.2 | 0.1 | |
Reclassifications, net of tax | $ 0.6 | $ 0.3 | |
[1] | These accumulated other comprehensive loss components are included in the calculation of net periodic pension and other postretirement benefits plan income recognized in investment and other income, net in the Unaudited Condensed Consolidated Statements of Operations (see Note 6, Retirement Plans |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2020Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 4 |
Number of reportable segments | 4 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information (Details) - USD ($) $ in Millions | 3 Months Ended | |||||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | ||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | $ 220.7 | $ 229.6 | ||||
Income (Loss) from Operations | 11.9 | 6.6 | ||||
Assets | 934.8 | [1] | 1,002.4 | [1] | $ 886.9 | |
Depreciation and amortization | 12.4 | 12.1 | ||||
Capital Expenditures | 6.9 | 15.1 | ||||
Capital Markets - Software Solutions | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 31.2 | 30.5 | ||||
Capital Markets - Compliance and Communications Management | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 99.1 | 102 | ||||
Investment Companies - Software Solutions | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 16.1 | 14.2 | ||||
Investment Companies - Compliance and Communications Management | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 74.3 | 82.9 | ||||
Operating Segments | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 220.7 | 229.6 | ||||
Income (Loss) from Operations | 25.4 | 17.8 | ||||
Assets | [1] | 851.5 | 911.5 | |||
Depreciation and amortization | 12.4 | 12.1 | ||||
Capital Expenditures | 6.3 | 15 | ||||
Operating Segments | Capital Markets - Software Solutions | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 31.2 | 30.5 | ||||
Income (Loss) from Operations | 1.8 | 0.1 | ||||
Assets | [1] | 163.9 | 160.8 | |||
Depreciation and amortization | 3.1 | 3.1 | ||||
Capital Expenditures | 3.3 | 3.3 | ||||
Operating Segments | Capital Markets - Compliance and Communications Management | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 99.1 | 102 | ||||
Income (Loss) from Operations | 21.4 | 14.7 | ||||
Assets | [1] | 447.6 | 484.1 | |||
Depreciation and amortization | 4 | 3.5 | ||||
Capital Expenditures | 0.2 | 1.7 | ||||
Operating Segments | Investment Companies - Software Solutions | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 16.1 | 14.2 | ||||
Income (Loss) from Operations | 0.1 | (3.7) | ||||
Assets | [1] | 98.3 | 105.9 | |||
Depreciation and amortization | 2.9 | 3.4 | ||||
Capital Expenditures | 2.8 | 4.1 | ||||
Operating Segments | Investment Companies - Compliance and Communications Management | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 74.3 | 82.9 | ||||
Income (Loss) from Operations | 2.1 | 6.7 | ||||
Assets | [1] | 141.7 | 160.7 | |||
Depreciation and amortization | 2.4 | 2.1 | ||||
Capital Expenditures | 0 | 5.9 | ||||
Corporate | ||||||
Segment Reporting Information [Line Items] | ||||||
Total net sales | 0 | 0 | ||||
Income (Loss) from Operations | (13.5) | (11.2) | ||||
Assets | [1] | 83.3 | 90.9 | |||
Depreciation and amortization | 0 | 0 | ||||
Capital Expenditures | $ 0.6 | $ 0.1 | ||||
[1] | Certain assets are recorded within a segment based on predominant usage, however as they benefit more than one segment, the related operating expenses are allocated between segments. |
Segment Information - Schedul_2
Segment Information - Schedule of Corporate Assets (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Segment Reporting Information [Line Items] | ||
Cash and cash equivalents | $ 7.7 | $ 17.2 |
Prepaid expenses and other current assets | 21.2 | 15.9 |
Right-of-use assets | 80.3 | 80.7 |
Other noncurrent assets | 41.3 | 41.3 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Cash and cash equivalents | 7.7 | 17.2 |
Prepaid expenses and other current assets | 14.4 | 11.7 |
Right-of-use assets | 11 | 11.5 |
Deferred income taxes, net of valuation allowance | 9.1 | 9 |
Other noncurrent assets | $ 34.4 | $ 34.2 |