Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 19, 2019 | |
Document Information [Line Items] | ||
Entity Registrant Name | MDC PARTNERS INC | |
Entity Central Index Key | 0000876883 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Current Reporting Status | Yes | |
Document Type | 10-Q | |
Entity Small Business | false | |
Document Fiscal Year Focus | 2019 | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Common Class A | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 71,943,944 | |
Common Class B | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 3,749 | |
Convertible Preferred Stock | Series 4 Convertible Preferred Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 145,000 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenue: | ||||
Services | $ 362,130 | $ 379,743 | $ 690,921 | $ 706,711 |
Operating expenses: | ||||
Cost of services sold | 240,749 | 253,390 | 477,903 | 496,420 |
Office and general expenses | 87,276 | 83,878 | 154,394 | 167,757 |
Depreciation and amortization | 10,663 | 11,703 | 19,501 | 24,078 |
Other asset impairment | 0 | 0 | 0 | 2,317 |
Costs and Expenses, Total | 338,688 | 348,971 | 651,798 | 690,572 |
Operating income (loss) | 23,442 | 30,772 | 39,123 | 16,139 |
Other income (expense): | ||||
Interest expense and finance charges, net | (16,413) | (16,859) | (33,174) | (32,942) |
Other, net | (746) | 592 | (4,128) | 1,033 |
Foreign exchange transaction gain (loss) | 2,932 | (6,549) | 8,374 | (13,209) |
Nonoperating Income (Expense), Total | (14,227) | (22,816) | (28,928) | (45,118) |
Income (loss) before income taxes and equity in earnings of non-consolidated affiliates | 9,215 | 7,956 | 10,195 | (28,979) |
Income tax expense (benefit) | 2,088 | 1,977 | 2,835 | (6,353) |
Income (loss) before equity in earnings of non-consolidated affiliates | 7,127 | 5,979 | 7,360 | (22,626) |
Equity in earnings of non-consolidated affiliates | 206 | (28) | 289 | 58 |
Net income (loss) | 7,333 | 5,951 | 7,649 | (22,568) |
Net income attributable to the noncontrolling interests | (3,043) | (2,545) | (3,472) | (3,442) |
Net loss attributable to MDC Partners Inc. | $ 4,290 | 3,406 | $ 4,177 | $ (26,010) |
Accretion on convertible preference shares | $ 2,273 | |||
Basic and diluted | ||||
Income (Loss) from Continuing Operations, Per Diluted Share | $ 0.01 | $ 0.02 | $ (0.02) | $ (0.53) |
Weighted Average Number of Common Shares Outstanding: | ||||
Weighted Average Number of Shares Outstanding, Basic | 71,915,832 | 57,439,823 | 66,118,749 | 56,924,208 |
Weighted Average Number of Shares Outstanding, Diluted | 72,024,689 | 57,802,872 | 66,118,749 | 56,924,208 |
Stock-based compensation | $ 3,634 | $ 5,603 | $ 6,606 | $ 10,640 |
Cost of services sold | ||||
Weighted Average Number of Common Shares Outstanding: | ||||
Stock-based compensation | 2,442 | 4,047 | 6,987 | 7,394 |
Office and general expenses | ||||
Weighted Average Number of Common Shares Outstanding: | ||||
Stock-based compensation | 1,192 | $ 1,556 | $ (381) | 3,246 |
Series 4 Convertible Preferred Stock [Domain] | Preferred Stock | ||||
Other income (expense): | ||||
Accretion on convertible preference shares | $ 3,515 | $ 4,095 |
UNAUDITED CONSOLIDATED STATEMEN
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Comprehensive income (loss) | ||||
Net loss | $ 7,333 | $ 5,951 | $ 7,649 | $ (22,568) |
Other comprehensive income (loss), net of applicable tax: | ||||
Foreign currency translation adjustment | (1,385) | (1,848) | (6,044) | 429 |
Other comprehensive income (loss) | (1,385) | (1,848) | (6,044) | 429 |
Comprehensive loss for the period | 5,948 | 4,103 | 1,605 | (22,139) |
Comprehensive loss (income) attributable to the noncontrolling interests | 3,081 | 1,641 | 3,861 | 1,436 |
Comprehensive loss attributable to MDC Partners Inc. | $ 2,867 | $ 2,462 | $ (2,256) | $ (23,575) |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS $ in Thousands | Jun. 30, 2019USD ($) |
Current Assets: | |
Cash and cash equivalents | $ 27,304 |
Accounts receivable, less allowance for doubtful accounts of $2,066 and $1,879 | 434,512 |
Expenditures billable to clients | 40,605 |
Assets held for sale | 0 |
Other current assets | 44,815 |
Total Current Assets | 547,236 |
Fixed assets, at cost, less accumulated depreciation of $133,879 and $128,546 | 83,950 |
Right of use assets - operating leases | 237,418 |
Investment in non-consolidated affiliates | 6,761 |
Goodwill | 743,582 |
Other intangible assets, net, less accumulated amortization of $164,347 and $161,868 | 60,848 |
Deferred tax assets | 92,439 |
Other assets | 26,415 |
Total Assets | 1,798,649 |
Current Liabilities: | |
Accounts payable | 228,069 |
Accruals and other liabilities | 253,868 |
Liabilities held for sale | 0 |
Advance billings | 168,142 |
Current portion of lease liabilities - operating leases | 46,338 |
Current portion of deferred acquisition consideration | 35,439 |
Total Current Liabilities | 731,856 |
Long-term debt | 914,092 |
Long-term portion of deferred acquisition consideration | 22,804 |
Long-term lease liabilities - operating leases | 233,165 |
Other Liabilities | 19,503 |
Deferred tax liabilities | 6,571 |
Total Liabilities | 1,927,991 |
Redeemable Noncontrolling Interests | 42,635 |
Shareholders' Deficit: | |
Convertible preference shares, 145,000 authorized, issued and outstanding at March 31, 2019 and 95,000 at December 31, 2018 | 152,746 |
Common stock and other paid-in capital | 97,455 |
Accumulated deficit | (460,726) |
Accumulated other comprehensive (loss) income | (1,713) |
MDC Partners Inc. Shareholders' Deficit | (212,238) |
Noncontrolling Interests | 40,261 |
Total Shareholders' Deficit | (171,977) |
Total Liabilities, Redeemable Noncontrolling Interests and Shareholders' Deficit | $ 1,798,649 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 2,066 | $ 1,879 |
Fixed assets, accumulated depreciation | 134,519 | 128,546 |
Other intangible assets, accumulated depreciation | $ 164,347 | $ 161,868 |
Preference shares, authorized (in shares) | 145,000 | 95,000 |
Preference shares, issued (in shares) | 145,000 | 95,000 |
Preference shares, outstanding (in shares) | 145,000 | 95,000 |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||||
Net loss | $ 7,333 | $ 5,951 | $ 7,649 | $ (22,568) | |
Adjustments to reconcile income (loss) to cash provided by (used in) operating activities: | |||||
Stock-based compensation | 3,634 | 5,603 | 6,606 | 10,640 | |
Depreciation | 12,621 | 14,642 | |||
Amortization of intangibles | 6,880 | 9,436 | |||
Amortization of deferred finance charges and debt discount | 1,663 | 1,605 | |||
Other asset impairment | 0 | 0 | 0 | 2,317 | |
Adjustment to deferred acquisition consideration | (5,570) | (2,479) | |||
Deferred income taxes | 2,835 | (9,494) | |||
Loss on sale of assets | 3,407 | (955) | |||
Earnings of non-consolidated affiliates | (206) | 28 | (289) | (58) | |
Other and non-current assets and liabilities | (4,139) | (1,114) | |||
Foreign exchange | (7,363) | 12,128 | |||
Changes in working capital: | |||||
Accounts receivable | (21,570) | 19,181 | |||
Expenditures billable to clients | 1,763 | (27,935) | |||
Prepaid expenses and other current assets | (3,345) | (12,732) | |||
Accounts payable, accruals and other current liabilities | (66,343) | (60,015) | |||
Acquisition related payments | (4,376) | (23,894) | |||
Advance billings | 29,334 | 29,582 | |||
Net cash used in operating activities | (40,237) | (61,713) | |||
Cash flows provided by (used in) investing activities: | |||||
Capital expenditures | (4,317) | (5,890) | (7,923) | (9,689) | |
Proceeds from sale of assets | 23,050 | 0 | |||
Acquisitions, net of cash acquired | (5,130) | (27,299) | |||
Other investments | (179) | 867 | |||
Net cash provided by (used in) investing activities | 9,818 | (36,121) | |||
Cash flows provided by financing activities: | |||||
Acquisition related payments | (24,219) | (29,172) | |||
Distributions to noncontrolling interests | (7,957) | (8,927) | $ (13,419) | ||
Payment of dividends | (56) | (168) | |||
Purchase of shares | (78) | (493) | |||
Other | 0 | (141) | |||
Net cash provided by financing activities | 25,712 | 76,343 | |||
Effect of exchange rate changes on cash, cash equivalents, and cash held in trusts | 4 | 311 | |||
Net decrease in cash, cash equivalents, and cash held in trusts including cash classified within assets held for sale | (4,703) | (21,180) | |||
Change in cash and cash equivalents classified within assets held for sale | 4,441 | 0 | |||
Net decrease in cash and cash equivalents | (3,569) | (21,180) | |||
Cash, cash equivalents, and cash held in trusts at beginning of period | 30,873 | 46,179 | 46,179 | ||
Cash, cash equivalents, and cash held in trusts at end of period | $ 27,304 | $ 24,999 | 27,304 | 24,999 | $ 30,873 |
Supplemental disclosures: | |||||
Cash income taxes paid | 3,494 | 2,626 | |||
Cash interest paid | 31,643 | 31,414 | |||
Wells Fargo Capital Finance, LLC | Revolving Credit Facility | |||||
Cash flows provided by financing activities: | |||||
Repayments of revolving credit facility | (834,538) | (782,600) | |||
Proceeds from revolving credit facility | 793,940 | 897,844 | |||
Change in cash and cash equivalents held in trusts classified within held for sale | (3,307) | 0 | |||
Series 4 Convertible Preferred Stock | |||||
Cash flows provided by financing activities: | |||||
Proceeds from issuance of common and convertible preference shares, net of issuance costs | $ 98,620 |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT - USD ($) $ in Thousands | Total | Convertible Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Deficit | AOCI Attributable to Parent [Member] | Accumulated Other Comprehensive Income (Loss) | MDC Partners Inc. Shareholders' Deficit | Noncontrolling Interest | Common Class A [Member]Common Stock | Series 4 Convertible Preferred Stock [Member]Convertible Preferred Stock |
Balance at Dec. 31, 2017 | $ (155,513) | $ 38,191 | $ (340,000) | $ (1,954) | $ (213,543) | $ 58,030 | |||||
Balance (in shares) at Dec. 31, 2017 | 95,000 | ||||||||||
Common stock, balance (in shares) at Dec. 31, 2017 | 56,375,131 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net loss attributable to MDC Partners Inc. | 3,406 | 3,406 | |||||||||
Shares acquired and cancelled | (39) | (39) | (39) | ||||||||
Balance at Mar. 31, 2018 | (153,336) | $ 90,123 | 45,824 | (367,180) | 481 | (230,752) | 77,416 | ||||
Balance (in shares) at Mar. 31, 2018 | 95,000,000 | ||||||||||
Common stock, balance (in shares) at Mar. 31, 2018 | 57,454,028 | ||||||||||
Adjustments to Additional Paid in Capital, Changes due to Business Combinations | (97) | (97) | |||||||||
Balance at Dec. 31, 2018 | (246,967) | $ 90,123 | 58,579 | (464,903) | 4,720 | (311,481) | 64,514 | ||||
Balance (in shares) at Dec. 31, 2018 | 95,000,000 | 57,517,568 | |||||||||
Common stock, balance (in shares) at Dec. 31, 2018 | 57,521,323 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net loss attributable to MDC Partners Inc. | 4,177 | ||||||||||
Other comprehensive income (loss) | (6,044) | $ (6,433) | (6,433) | 389 | |||||||
Issuance of common and preference shares (in shares) | 50,000,000 | 14,285,714 | |||||||||
Issuance of common and convertible preference shares | 98,620 | $ 62,623 | 35,997 | 98,620 | |||||||
Issuance of restricted stock | 0 | ||||||||||
Issuance of restricted stock (in shares) | 193,979 | ||||||||||
Shares acquired and cancelled | (78) | (78) | (78) | ||||||||
Shares acquired and cancelled (in shares) | (53,273) | ||||||||||
Stock-based compensation | 509 | 509 | 509 | ||||||||
Changes in redemption value of redeemable noncontrolling interests | 2,729 | 2,729 | 2,729 | ||||||||
Changes in ownership interest | (24,642) | ||||||||||
Balance at Jun. 30, 2019 | $ (171,977) | $ 152,746 | $ 97,455 | $ (460,726) | $ (1,713) | $ (212,238) | $ 40,261 | ||||
Balance (in shares) at Jun. 30, 2019 | 145,000,000 | 71,943,994 | 145,000 | ||||||||
Common stock, balance (in shares) at Jun. 30, 2019 | 71,947,743 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | asis of Presentation and Recent Developments The accompanying consolidated financial statements include the accounts of MDC Partners Inc. (the “Company” or “MDC”), its subsidiaries and variable interest entities for which the Company is the primary beneficiary. References herein to “Partner Firms” generally refer to the Company’s subsidiary agencies. MDC Partners Inc. has prepared the unaudited condensed consolidated interim financial statements included herein in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for reporting interim financial information on Form 10-Q. Accordingly, the financial statements have been condensed and do not include certain information and disclosures pursuant to these rules. The preparation of financial statements in conformity with GAAP requires us to make judgments, assumptions and estimates that affect the amounts reported and disclosed. Actual results could differ from these estimates and assumptions. The consolidated results for interim periods are not necessarily indicative of results for the full year and should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 (“2018 Form 10-K”). The accompanying financial statements reflect all adjustments, consisting of normally recurring accruals, which in the opinion of management are necessary for a fair presentation, in all material respects, of the information contained therein. Intercompany balances and transactions have been eliminated in consolidation. Certain reclassifications have been made to the prior year financial information to conform to the current year presentation. Due to changes in the composition of certain business and the Company’s internal management and reporting structure during 2019, reportable segment results for the 2018 periods presented have been recast to reflect the reclassification of certain businesses between segments. See Note 12 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for further information. |
Revenue
Revenue | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue The Company’s revenue recognition policies are established in accordance with the Revenue Recognition topics of ASC 606, and accordingly, revenue is recognized when control of the promised goods or services is transferred to our clients, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. The MDC network provides an extensive range of services to our clients offering a variety of marketing and communication capabilities including strategy, creative and production for advertising campaigns across a variety of platforms (print, digital, social media, television broadcast), public relations services including strategy, editorial, crisis support or issues management, media training, influencer engagement and events management. We also provide media buying and planning across a range of platforms (out-of-home, paid search, social media, lead generation, programmatic, television broadcast), experiential marketing and application/website design and development. The primary source of the Company’s revenue is from agency arrangements in the form of fees for services performed, commissions, and from performance incentives or bonuses, depending on the terms of the client contract. In all circumstances, revenue is only recognized when collection is reasonably assured. Certain of the Company’s contractual arrangements have more than one performance obligation. For such arrangements, revenue is allocated to each performance obligation based on its relative stand-alone selling price. Stand-alone selling prices are determined based on the prices charged to clients or using expected cost plus margin. The determination of our performance obligations is specific to the services included within each contract. Based on a client’s requirements within the contract, and how these services are provided, multiple services could represent separate performance obligations or be combined and considered one performance obligation. Contracts that contain services that are not significantly integrated nor interdependent, nor that significantly modify or customize each other, are considered separate performance obligations. Typically, we consider media planning, media buying, creative (or strategy), production and experiential marketing services to be separate performance obligations if included in the same contract as each of these services can be provided on a stand-alone basis, and do not significantly modify or customize each other. Public relations services and application/website design and development are typically each considered one performance obligation as there is a significant integration of these services into a combined output. We typically satisfy our performance obligations over time, as services are performed. Fees for services are typically recognized using input methods (direct labor hours, materials and third-party costs) that correspond with efforts incurred to date in relation to total estimated efforts to complete the contract. Point in time recognition primarily relates to certain commission-based contracts, which are recognized upon the placement of advertisements in various media when the Company has no further performance obligation. Revenue is recognized net of sales and other taxes due to be collected and remitted to governmental authorities. The Company’s contracts typically provide for termination by either party within 30 to 90 days. Although payment terms vary by client, they are typically within 30 to 60 days. In addition, the Company generally has the right to payment for all services provided through the end of the contract or termination date. Within each contract, we identify whether the Company is principal or agent at the performance obligation level. In arrangements where the Company has substantive control over the service before transferring it to the client, and is primarily responsible for integrating the services into the final deliverables, we act as principal. In these arrangements, revenue is recorded at the gross amount billed. Accordingly, for these contracts the Company has included reimbursed expenses in revenue. In other arrangements where a third-party supplier, rather than the Company is primarily responsible for the integration of services into the final deliverables, and thus the Company is solely arranging for the third-party supplier to provide these services to our client, we generally act as agent and record revenue equal to the net amount retained, when the fee or commission is earned. The role of MDC’s agencies under a production services agreement is to facilitate a client’s purchasing of production capabilities from a third-party production company in accordance with the client’s strategy and guidelines. The obligation of MDC’s agencies under media buying services is to negotiate and purchase advertising media from a third-party media vendor on behalf of a client to execute its media plan. We do not obtain control prior to transferring these services to our clients; therefore, we primarily act as agent for production and media buying services. A small portion of the Company’s contractual arrangements with clients include performance incentive provisions, which allow the Company to earn additional revenues as a result of its performance relative to both quantitative and qualitative goals. Incentive compensation is primarily estimated using the most likely amount method and is included in revenue up to the amount that is not expected to result in a reversal of a significant amount of cumulative revenue recognized. We recognize revenue related to performance incentives as we satisfy the performance obligation to which the performance incentives are related. Disaggregated Revenue Data The Company provides a broad range of services to a large base of clients across the full spectrum of industry verticals on a global basis. The primary source of revenue is from agency arrangements in the form of fees for services performed, commissions, and from performance incentives or bonuses. Certain clients may engage with the Company in various geographic locations, across multiple disciplines, and through multiple Partner Firms. Representation of a client rarely means that MDC handles marketing communications for all brands or product lines of the client in every geographical location. The Company’s Partner firms often cooperate with one another through referrals and the sharing of both services and expertise, which enables MDC to service clients’ varied marketing needs by crafting custom integrated solutions. Additionally, the Company maintains separate, independent operating companies to enable it to effectively manage potential conflicts of interest by representing competing clients across the MDC network. The following table presents revenue disaggregated by client industry vertical for the three and six months ended June 30, 2019 and 2018 : Three Months Ended June 30, Six Months Ended June 30, Industry Reportable Segment 2019 2018 2019 2018 Food & Beverage All $ 73,305 $ 84,464 $ 139,969 $ 147,932 Retail All 39,894 38,396 72,350 76,411 Consumer Products All 45,296 41,367 78,232 77,973 Communications All 47,793 43,097 87,490 81,454 Automotive All 18,541 25,294 36,732 45,788 Technology All 28,876 23,540 54,279 45,080 Healthcare All 25,954 35,426 49,161 68,002 Financials All 27,868 30,207 52,795 52,702 Transportation and Travel/Lodging All 27,050 18,776 44,085 33,664 Other All 27,553 39,176 75,828 77,705 $ 362,130 $ 379,743 $ 690,921 $ 706,711 MDC has historically largely focused where the Company was founded in North America, the largest market for its services in the world. In recent years the Company has expanded its global footprint to support clients looking for help to grow their businesses in new markets. Today, MDC’s Partner Firms are located in the United States, Canada, and an additional twelve countries around the world. In the past, some clients have responded to weakening economic conditions with reductions to their marketing budgets, which included discretionary components that are easier to reduce in the short term than other operating expenses. The following table presents revenue disaggregated by geography for the three and six months ended June 30, 2019 and 2018 : Three Months Ended June 30, Six Months Ended June 30, Geographic Location Reportable Segment 2019 2018 2019 2018 United States All $ 284,659 $ 295,268 $ 547,676 $ 551,792 Canada All, excluding Media Services 24,564 33,086 46,942 59,465 Other All, excluding Media Services and Domestic Creative Agencies 52,907 51,389 96,303 95,454 $ 362,130 $ 379,743 $ 690,921 $ 706,711 Contract assets and liabilities Contract assets consist of fees and reimbursable outside vendor costs incurred on behalf of clients when providing advertising, marketing and corporate communications services that have not yet been invoiced to clients. Unbilled service fees were $92,317 and $64,362 at June 30, 2019 and December 31, 2018 , respectively, and are included as a component of accounts receivable on the Unaudited Condensed Consolidated Balance Sheets . Outside vendor costs incurred on behalf of clients which have yet to be invoiced were $40,605 and $42,369 at June 30, 2019 and December 31, 2018 , respectively, and are included on the Unaudited Condensed Consolidated Balance Sheets as expenditures billable to clients. Such amounts are invoiced to clients at various times over the course of providing services. Contract liabilities consist of fees billed to clients in excess of fees recognized as revenue and are classified as advance billings on the Company’s Unaudited Condensed Consolidated Balance Sheets . Advance billings at June 30, 2019 and December 31, 2018 were $168,142 and $138,505 , respectively. The increase in the advance billings balance of $29,637 for the six months ended June 30, 2019 is primarily driven by cash payments received or due in advance of satisfying our performance obligations, offset by $101,431 of revenues recognized that were included in the advance billings balances as of December 31, 2018 and reductions due to the incurrence of third-party costs. Changes in the contract asset and liability balances during the six months ended June 30, 2019 and December 31, 2018 were not materially impacted by write-offs, impairment losses or any other factors. |
Loss Per Common Share
Loss Per Common Share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Loss Per Common Share | Loss) Per Common Share The following table sets forth the computation of basic and diluted income (loss) per common share: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Numerator: Net income (loss) attributable to MDC Partners Inc. $ 4,290 $ 3,406 $ 4,177 $ (26,010 ) Accretion on convertible preference shares (3,242 ) (2,068 ) (5,625 ) (4,095 ) Net income allocated to convertible preference shares (273 ) (205 ) — — Net income (loss) attributable to MDC Partners Inc. common shareholders $ 775 $ 1,133 $ (1,448 ) $ (30,105 ) Adjustment to net income allocated to convertible preference shares — 1 — — Numerator for dilutive income (loss) per common share: Net income (loss) attributable to MDC Partners Inc. common shareholders $ 775 $ 1,134 $ (1,448 ) $ (30,105 ) Denominator: Basic weighted average number of common shares outstanding 71,915,832 57,439,823 66,118,749 56,924,208 Effect of dilutive securities: Impact of stock options and non-vested stock under employee stock incentive plans 108,857 363,049 — — Diluted weighted average number of common shares outstanding 72,024,689 57,802,872 66,118,749 56,924,208 Basic $ 0.01 $ 0.02 $ (0.02 ) $ (0.53 ) Diluted $ 0.01 $ 0.02 $ (0.02 ) $ (0.53 ) Anti-dilutive stock awards 2,662,666 327,500 4,406,206 1,594,761 Restricted stock and restricted stock unit awards of 242,338 and 1,308,781 for the three and six months ended June 30, 2019 and 2018 , respectively, which are contingent upon the Company meeting a cumulative three year earnings target and contingent upon continued employment, are excluded from the computation of diluted income per common share as the contingencies were not satisfied at June 30, 2019 and 2018 , respectively. In addition, there were 145,000 and 95,000 Preference Shares outstanding which were convertible into 25,621,189 and 10,544,708 Class A common shares at June 30, 2019 and 2018 , respectively. These Preference Shares were anti-dilutive for each period presented in the table above and are therefore excluded from the diluted income (loss) per common share calculation. |
Acquisitions and Dispositions
Acquisitions and Dispositions | 6 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisitions and Dispositions | Acquisitions and Dispositions 2019 Acquisition Effective April 1, 2019, the Company acquired the 35% ownership interest of HPR Partners LLC (Hunter) it did not own for an aggregate purchase price of $9,585 , comprised of a closing cash payment of $3,890 and additional deferred acquisition payments with an estimated present value at the acquisition date of $5,695 . The deferred payments are based on the financial results of the underlying business from 2018 to 2020 with final payment due in 2021. As of the acquisition date, the fair value of the additional interest acquired was $20,178 . The fair value was measured using a discounted cash flow model. As a result of the transaction, the Company reduced redeemable noncontrolling interests by $9,488 . The difference between the purchase price and the noncontrolling interest of $97 was recorded in common stock and other paid-in capital in the Unaudited Condensed Consolidated Balance Sheet. 2019 Disposition On March 8, 2019, the Company consummated the sale of Kingsdale, an operating segment with operations in Toronto and New York City that provides shareholder advisory services. As consideration for the sale, the Company was paid cash plus the assumption of certain liabilities totaling approximately $50 million in the aggregate. The sale resulted in a loss of approximately $3 million , which is included in Other, net within the Unaudited Condensed Consolidated Statement of Operations. Assets and Liabilities Held for Sale - Change in Plan to Sell In the fourth quarter of 2018, the Company initiated a process to sell its ownership interest in a foreign office within the Global Integrated Agencies reportable segment. The assets and liabilities of the entity were classified as Assets and Liabilities held for sale, at their fair value less cost to sell, within the Consolidated Balance Sheet as of December 31, 2018. In the second quarter of 2019, following the appointment of Mark Penn as Chief Executive Officer, management changed its strategy and plan to sell the foreign office. In connection with management’s decision, the amounts classified within assets and liabilities held for sale were reclassified into the respective line items within the Unaudited Condensed Consolidated Balance Sheet as of June 30, 2019. 2018 Acquisitions On September 7, 2018, a subsidiary of the Company purchased 100% interests of OneChocolate Communications Limited and OneChocolate Communications LLC, PR (“OneChocolate”) a digital marketing consultancy headquartered in London, UK, for an aggregate purchase price of $3,231 , working capital of $966 and additional deferred acquisition payments with an estimated present value of $2,146 . OneChocolate’s results are reflected in the Allison & Partners operating segment which is included in the Specialist Communications reportable segment which had an immaterial impact on our results. On July 1, 2018, the Company acquired the remaining 14.87% and 3% of membership interests of Doner Partners, LLC and Source Marketing LLC, respectively, for an aggregate purchase price of $7,618 , comprised of a closing cash payment of $3,279 and additional deferred acquisition payments with an estimated present value of $4,305 as of December 31, 2018. As of the acquisition date, the fair value of the additional interests acquired was $16,361 for Doner Partners LLC. The fair values were measured using a discounted cash flow model. As a result of the transaction, the Company reduced noncontrolling interest by $11,946 and redeemable noncontrolling interest by $933 . On April 2, 2018, the Company purchased 51% of the membership interests of Instrument LLC (“Instrument”), a digital creative agency based in Portland, Oregon, for an aggregate purchase price of $35,591 . The acquisition is expected to facilitate the Company’s growth and help to build its portfolio of modern, innovative and digital-first agencies. The purchase price consisted of a cash payment of $28,561 and the issuance of 1,011,561 shares of the Company’s Class A subordinate voting stock with an acquisition date fair value of $7,030 . The Company issued these shares in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) of the Securities Act. The purchase price allocation for Instrument resulted in tangible assets of $10,304 , identifiable intangibles of $23,130 , consisting primarily of customer lists and a trade name, and goodwill of $32,776 . In addition, the Company has recorded $27,357 as the fair value of noncontrolling interests, which was derived from the Company’s purchase price less a discount related to the noncontrolling parties’ lack of control. The identified assets have a weighted average useful life of approximately six years and will be amortized in a manner represented by the pattern in which the economic benefits of such assets are expected to be realized. The goodwill is tax deductible. Instruments’ results are included in the All Other category from a segment reporting perspective. The Company has a controlling financial interest in Instrument through its majority voting interest, and as such, has aggregated the acquired Partner Firm’s financial data into the Company’s Unaudited Condensed Consolidated Financial Statements . The operating results of Instrument in the current year is not material. Effective January 1, 2018, the Company acquired the remaining 24.5% ownership interest of Allison & Partners LLC for an aggregate purchase price of $10,023 , comprised of a closing cash payment of $300 and additional deferred acquisition payments with an estimated present value at the acquisition date of $9,723 . The deferred payments are based on the future financial results of the underlying business from 2017 to 2020 with final payments due in 2021. As of the acquisition date, the fair value of the additional interest acquired was $20,096 . The fair value was measured using a discounted cash flow model. As a result of the transaction, the Company reduced redeemable noncontrolling interests by $8,857 . The difference between the purchase price and the noncontrolling interest of $1,166 was recorded in additional paid-in capital. Deferred Acquisition Consideration Deferred acquisition consideration on the balance sheet consists of deferred obligations related to contingent and fixed purchase price payments, and to a lesser extent, contingent and fixed retention payments tied to continued employment of specific personnel. Contingent deferred acquisition consideration is recorded at the acquisition date fair value and adjusted at each reporting period through operating income, for contingent purchase price payments, or net interest expense, for fixed purchase price payments. The Company accounts for retention payments through operating income as stock-based compensation over the required retention period. The following table presents changes in contingent deferred acquisition consideration, which is measured at fair value on a recurring basis using significant unobservable inputs, and a reconciliation to the amounts reported on the balance sheets as of June 30, 2019 and December 31, 2018 . June 30, December 31, 2019 2018 Beginning Balance of contingent payments $ 82,598 $ 119,086 Payments (24,492 ) (54,947 ) Redemption value adjustments (1) (6,100 ) 3,512 Additions - acquisitions and step up transactions 5,695 14,943 Other — 4 Ending Balance of contingent payments $ 57,701 $ 82,598 Fixed payments 542 1,097 $ 58,243 $ 83,695 (1) Redemption value adjustments are fair value changes from the Company’s initial estimates of deferred acquisition payments and stock-based compensation charges relating to acquisition payments that are tied to continued employment. Redemption value adjustments are recorded within cost of services sold and office and general expenses on the Unaudited Condensed Consolidated Statements of Operations. The following table presents the impact to the Company’s statement of operations due to the redemption value adjustments for the contingent deferred acquisition consideration: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Income (loss) attributable to fair value adjustments $ 2,073 $ (5,065 ) $ (5,570 ) $ (2,479 ) Stock-based compensation (1,339 ) 2,321 (530 ) 4,682 Redemption value adjustments $ 734 $ (2,744 ) $ (6,100 ) $ 2,203 |
Deferred Acquisition Considerat
Deferred Acquisition Consideration | 6 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Deferred Acquisition Consideration | Acquisitions and Dispositions 2019 Acquisition Effective April 1, 2019, the Company acquired the 35% ownership interest of HPR Partners LLC (Hunter) it did not own for an aggregate purchase price of $9,585 , comprised of a closing cash payment of $3,890 and additional deferred acquisition payments with an estimated present value at the acquisition date of $5,695 . The deferred payments are based on the financial results of the underlying business from 2018 to 2020 with final payment due in 2021. As of the acquisition date, the fair value of the additional interest acquired was $20,178 . The fair value was measured using a discounted cash flow model. As a result of the transaction, the Company reduced redeemable noncontrolling interests by $9,488 . The difference between the purchase price and the noncontrolling interest of $97 was recorded in common stock and other paid-in capital in the Unaudited Condensed Consolidated Balance Sheet. 2019 Disposition On March 8, 2019, the Company consummated the sale of Kingsdale, an operating segment with operations in Toronto and New York City that provides shareholder advisory services. As consideration for the sale, the Company was paid cash plus the assumption of certain liabilities totaling approximately $50 million in the aggregate. The sale resulted in a loss of approximately $3 million , which is included in Other, net within the Unaudited Condensed Consolidated Statement of Operations. Assets and Liabilities Held for Sale - Change in Plan to Sell In the fourth quarter of 2018, the Company initiated a process to sell its ownership interest in a foreign office within the Global Integrated Agencies reportable segment. The assets and liabilities of the entity were classified as Assets and Liabilities held for sale, at their fair value less cost to sell, within the Consolidated Balance Sheet as of December 31, 2018. In the second quarter of 2019, following the appointment of Mark Penn as Chief Executive Officer, management changed its strategy and plan to sell the foreign office. In connection with management’s decision, the amounts classified within assets and liabilities held for sale were reclassified into the respective line items within the Unaudited Condensed Consolidated Balance Sheet as of June 30, 2019. 2018 Acquisitions On September 7, 2018, a subsidiary of the Company purchased 100% interests of OneChocolate Communications Limited and OneChocolate Communications LLC, PR (“OneChocolate”) a digital marketing consultancy headquartered in London, UK, for an aggregate purchase price of $3,231 , working capital of $966 and additional deferred acquisition payments with an estimated present value of $2,146 . OneChocolate’s results are reflected in the Allison & Partners operating segment which is included in the Specialist Communications reportable segment which had an immaterial impact on our results. On July 1, 2018, the Company acquired the remaining 14.87% and 3% of membership interests of Doner Partners, LLC and Source Marketing LLC, respectively, for an aggregate purchase price of $7,618 , comprised of a closing cash payment of $3,279 and additional deferred acquisition payments with an estimated present value of $4,305 as of December 31, 2018. As of the acquisition date, the fair value of the additional interests acquired was $16,361 for Doner Partners LLC. The fair values were measured using a discounted cash flow model. As a result of the transaction, the Company reduced noncontrolling interest by $11,946 and redeemable noncontrolling interest by $933 . On April 2, 2018, the Company purchased 51% of the membership interests of Instrument LLC (“Instrument”), a digital creative agency based in Portland, Oregon, for an aggregate purchase price of $35,591 . The acquisition is expected to facilitate the Company’s growth and help to build its portfolio of modern, innovative and digital-first agencies. The purchase price consisted of a cash payment of $28,561 and the issuance of 1,011,561 shares of the Company’s Class A subordinate voting stock with an acquisition date fair value of $7,030 . The Company issued these shares in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) of the Securities Act. The purchase price allocation for Instrument resulted in tangible assets of $10,304 , identifiable intangibles of $23,130 , consisting primarily of customer lists and a trade name, and goodwill of $32,776 . In addition, the Company has recorded $27,357 as the fair value of noncontrolling interests, which was derived from the Company’s purchase price less a discount related to the noncontrolling parties’ lack of control. The identified assets have a weighted average useful life of approximately six years and will be amortized in a manner represented by the pattern in which the economic benefits of such assets are expected to be realized. The goodwill is tax deductible. Instruments’ results are included in the All Other category from a segment reporting perspective. The Company has a controlling financial interest in Instrument through its majority voting interest, and as such, has aggregated the acquired Partner Firm’s financial data into the Company’s Unaudited Condensed Consolidated Financial Statements . The operating results of Instrument in the current year is not material. Effective January 1, 2018, the Company acquired the remaining 24.5% ownership interest of Allison & Partners LLC for an aggregate purchase price of $10,023 , comprised of a closing cash payment of $300 and additional deferred acquisition payments with an estimated present value at the acquisition date of $9,723 . The deferred payments are based on the future financial results of the underlying business from 2017 to 2020 with final payments due in 2021. As of the acquisition date, the fair value of the additional interest acquired was $20,096 . The fair value was measured using a discounted cash flow model. As a result of the transaction, the Company reduced redeemable noncontrolling interests by $8,857 . The difference between the purchase price and the noncontrolling interest of $1,166 was recorded in additional paid-in capital. Deferred Acquisition Consideration Deferred acquisition consideration on the balance sheet consists of deferred obligations related to contingent and fixed purchase price payments, and to a lesser extent, contingent and fixed retention payments tied to continued employment of specific personnel. Contingent deferred acquisition consideration is recorded at the acquisition date fair value and adjusted at each reporting period through operating income, for contingent purchase price payments, or net interest expense, for fixed purchase price payments. The Company accounts for retention payments through operating income as stock-based compensation over the required retention period. The following table presents changes in contingent deferred acquisition consideration, which is measured at fair value on a recurring basis using significant unobservable inputs, and a reconciliation to the amounts reported on the balance sheets as of June 30, 2019 and December 31, 2018 . June 30, December 31, 2019 2018 Beginning Balance of contingent payments $ 82,598 $ 119,086 Payments (24,492 ) (54,947 ) Redemption value adjustments (1) (6,100 ) 3,512 Additions - acquisitions and step up transactions 5,695 14,943 Other — 4 Ending Balance of contingent payments $ 57,701 $ 82,598 Fixed payments 542 1,097 $ 58,243 $ 83,695 (1) Redemption value adjustments are fair value changes from the Company’s initial estimates of deferred acquisition payments and stock-based compensation charges relating to acquisition payments that are tied to continued employment. Redemption value adjustments are recorded within cost of services sold and office and general expenses on the Unaudited Condensed Consolidated Statements of Operations. The following table presents the impact to the Company’s statement of operations due to the redemption value adjustments for the contingent deferred acquisition consideration: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Income (loss) attributable to fair value adjustments $ 2,073 $ (5,065 ) $ (5,570 ) $ (2,479 ) Stock-based compensation (1,339 ) 2,321 (530 ) 4,682 Redemption value adjustments $ 734 $ (2,744 ) $ (6,100 ) $ 2,203 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases Effective January 1, 2019, the Company adopted FASB ASC Topic 842, Leases (“ASC 842”). As a result, comparative prior periods have not been adjusted and continue to be reported under FASB ASC Topic 840, Leases. See Note 14 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for additional information regarding the Company’s adoption of ASC 842. The policies described herein refer to those in effect as of January 1, 2019. The Company leases office space in North America, Europe, Asia, South America, and Australia. This space is primarily used for office and administrative purposes by the Company’s employees in performing professional services. These leases are classified as operating leases and expire between years 2019 through 2032. Finance leases are considered to be immaterial to the Company. The Company’s leasing policies are established in accordance with ASC 842, and accordingly, the Company recognizes on the balance sheet at the time of lease commencement a right-of-use asset and a lease liability, initially measured at the present value of the lease payments. Right-of-use lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. All right-of-use assets are reviewed for impairment. As the Company’s implicit rate in its leases is not readily determinable, in determining the present value of lease payments, the Company uses its incremental borrowing rate based on the information available at the commencement date. Lease payments included in the measurement of the lease liability are comprised of noncancelable lease payments, payments based upon an index or rate, payments for optional renewal periods where it is reasonably certain the renewal period will be exercised, and payments for early termination options unless it is reasonably certain the lease will not be terminated early. Lease costs are recognized in the Consolidated Statement of Operations over the lease term on a straight-line basis. Leasehold improvements are depreciated on a straight-line basis over the lesser of the term of the related lease or the estimated useful life of the asset. Some of the Company’s leases contain variable lease payments, including payments based upon an index or rate. Variable lease payments based upon an index or rate are initially measured using the index or rate in effect at the lease commencement date and are included within the lease liabilities. Lease liabilities are not remeasured as a result of changes in the index or rate, rather changes in these types of payments are recognized in the period in which the obligation for those payments is incurred. In addition, some of our leases contain variable payments for utilities, insurance, real estate tax, repairs and maintenance, and other variable operating expenses. Such amounts are not included in the measurement of the lease liability and are recognized in the period when the facts and circumstances on which the variable lease payments are based upon occur. The Company’s leases include options to extend or renew the lease through 2040. The renewal and extension options are not included in the lease term as the Company is not reasonably certain that it will exercise its option. From time to time, the Company enters into sublease arrangements both with unrelated third-parties and with our partner agencies. These leases are classified as operating leases and expire between years 2019 through 2023. Sublease income is recognized over the lease term on a straight-line basis. Currently, the Company subleases office space in North America, Europe and Asia. As of June 30, 2019, the Company has entered into an operating lease for which the commencement date has not yet occurred as this leased space is in the process of being prepared by the landlord for occupancy. Accordingly, this lease represents an obligation of the Company that is not on the Consolidated Balance Sheet as of June 30, 2019. The aggregate future liability related to the lease is approximately $6 million . The discount rate used for leases accounted for under ASC 842 is the Company’s collateralized credit adjusted borrowing rate. The following table presents lease costs and other quantitative information for the three and six months ended June 30, 2019 : Three Months Ended June 30, Six Months Ended June 30, 2019 2019 Lease Cost: Operating lease cost $ 17,473 $ 33,914 Variable lease cost 4,361 9,325 Sublease rental income (2,590 ) (4,189 ) Total lease cost $ 19,244 $ 39,050 Additional information: Cash paid for amounts included in the measurement of lease liabilities for operating leases Operating cash flows $ 19,523 $ 35,175 Right-of-use assets obtained in exchange for operating lease liabilities $ 2,195 $ 259,013 Weighted average remaining lease term (in years) - Operating leases 7.0 7.0 Weighted average discount rate - Operating leases 8.6 8.6 Operating lease expense is included in office and general expenses in the Unaudited Condensed Consolidated Statement of Operations. Lease expense for leases with a term of 12 months or less is immaterial to the Company. Rental expense for the three and six months ended June 30, 2018 was $15,981 and $33,541 , respectively, offset by $926 and $1,640 , respectively in sublease rental income. The following table presents minimum future rental payments under the Company’s leases at June 30, 2019 and their reconciliation to the corresponding lease liabilities: Maturity Analysis Remaining 2019 $ 33,776 2020 66,425 2021 56,428 2022 45,942 2023 42,113 Thereafter 133,823 Total 378,507 Less: Present value discount (99,004 ) Lease liability $ 279,503 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt As of June 30, 2019 and December 31, 2018 , the Company’s indebtedness was comprised as follows: June 30, 2019 December 31, 2018 Revolving credit agreement $ 27,545 $ 68,143 6.50% Notes due 2024 900,000 900,000 Debt issuance costs (13,453 ) (14,036 ) $ 914,092 $ 954,107 6.50% Notes On March 23, 2016 , MDC entered into an indenture (the “Indenture”) among MDC, its existing and future restricted subsidiaries that guarantee, are co-borrowers under, or grant liens to secure, the Credit Agreement, as guarantors (the “Guarantors”) and The Bank of New York Mellon, as trustee, relating to the issuance by MDC of $900,000 aggregate principal amount of the senior unsecured notes due 2024 (the “6.50% Notes”) . The 6.50% Notes were sold in a private placement in reliance on exceptions from registration under the Securities Act of 1933. The 6.50% Notes bear interest, payable semiannually in arrears on May 1 and November 1, at a rate of 6.50% per annum. The 6.50% Notes mature on May 1, 2024 , unless earlier redeemed or repurchased. MDC may, at its option, redeem the 6.50% Notes in whole at any time or in part from time to time, on and after May 1, 2019 , at varying prices based on the timing of the redemption. The Indenture includes covenants that are subject to a number of important limitations and exceptions. The 6.50% Notes are also subject to customary events of default, including a cross-payment default and cross-acceleration provision. The Company was in compliance with all covenants at June 30, 2019 . Credit Agreement The Company is party to a $250,000 secured revolving credit facility due May 3, 2021. The amounts outstanding under the revolving credit facility as of June 30, 2019 and December 31, 2018 are presented in the table above and additional details are provided below. On March 12, 2019 (the “Amendment Effective Date”), the Company, Maxxcom Inc. (a subsidiary of the Company) (“Maxxcom”) and each of their subsidiaries party thereto entered into an Amendment to the existing senior secured revolving credit facility, dated as of May 3, 2016 (as amended, the “Credit Agreement”), among the Company, Maxxcom, each of their subsidiaries party thereto, Wells Fargo Capital Finance, LLC, as agent (“Wells Fargo”) and the lenders from time to time party thereto. Advances under the Credit Agreement are to be used for working capital and general corporate purposes, in each case pursuant to the terms of the Credit Agreement. The Amendment provides financial covenant relief by increasing the total leverage ratio applicable on each testing date after the Amendment Effective Date through the period ending December 31, 2020 from 5.5 :1.0 to 6.25 :1.0. The total leverage ratio applicable on each testing date after December 31, 2020 will revert to 5.5 :1.0. In connection with the Amendment, the Company reduced the aggregate maximum amount of revolving commitments provided by the lenders under the Credit Agreement to $250 million from $325 million . Advances under the Credit Agreement bear interest as follows: (a)(i) LIBOR Rate Loans bear interest at the LIBOR Rate and (ii) Base Rate Loans bear interest at the Base Rate, plus (b) an applicable margin. The initial applicable margin for borrowing is 0.75% in the case of Base Rate Loans and 1.50% in the case of LIBOR Rate Loans. In addition to paying interest on outstanding principal under the Credit Agreement, MDC is required to pay an unused revolver fee to lenders under the Credit Agreement in respect of unused commitments thereunder. The Credit Agreement, which includes financial and non-financial covenants, is guaranteed by substantially all of MDC’s present and future subsidiaries, other than immaterial subsidiaries and subject to customary exceptions and collateralized by a portion of MDC’s outstanding receivable balance. The Company is currently in compliance with all of the terms and conditions of its Credit Agreement. At June 30, 2019 and December 31, 2018 , the Company had issued undrawn outstanding letters of credit of $4,744 and $4,701 , respectively. |
Share Capital
Share Capital | 6 Months Ended |
Jun. 30, 2019 | |
Share Capital [Abstract] | |
Share Capital | Share Capital The authorized and outstanding share capital of the Company is as follows: Series 6 Convertible Preference Shares On March 14, 2019 (the “Series 6 Issue Date”), the Company entered into a securities purchase agreement with Stagwell Agency Holdings LLC (“Stagwell Holdings”), an affiliate of Stagwell Group LLC (“Stagwell”), pursuant to which Stagwell Holdings agreed to purchase, (i) 14,285,714 newly authorized Class A shares (the “Stagwell Class A Shares”) for an aggregate contractual purchase price of $50,000 and (ii) 50,000 newly authorized Series 6 convertible preference shares (“Series 6 Preference Shares”) for an aggregate contractual purchase price of $50 million . The Company received proceeds of approximately $98,620 , net of fees and estimated expenses, which were primarily used to pay down existing debt under the Company’s credit facility and for general corporate purposes. The proceeds allocated to the Stagwell Class A Shares were $35,997 and to Series 6 Preference Shares were $62,623 based on their relative fair value calculated by utilizing a Monte Carlo Simulation model. In connection with the closing of the transaction, the Company increased the size of its Board and appointed one nominee designated by the Purchaser. Except as required by law, the Series 6 Preference Shares do not have voting rights and are not redeemable at the option of the Purchaser. The holders of the Series 6 Preference Shares have the right to convert their Series 6 Preference Shares in whole at any time and from time to time, and in part at any time and from time to time, into a number of Class A Shares equal to the then-applicable liquidation preference divided by the applicable conversion price at such time (the “Conversion Price”). The initial liquidation per share preference of each Series 6 Preference Share is $1,000 . The initial Conversion Price is $5.00 per Series 6 Preference Share, subject to customary adjustments for share splits and combinations, dividends, recapitalizations and other matters, including weighted average anti-dilution protection for certain issuances of equity or equity-linked securities. The Series 6 Preference Shares’ liquidation preference accretes at 8.0% per annum, compounded quarterly until the five -year anniversary of the Series 6 Issue Date. During the six months ended June 30, 2019 , the Series 6 Preference Shares accreted at a monthly rate of $6.69, for total accretion of $1,193 , bringing the aggregate liquidation preference to $51,193 as of June 30, 2019 . The accretion is considered in the calculation of net income (loss) attributable to MDC Partners Inc. common shareholders. See Note 3 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for further information regarding the Series 6 Preference Shares. Holders of the Series 6 Preference Shares are entitled to dividends in an amount equal to any dividends that would otherwise have been payable on the Class A Shares issued upon conversion of the Series 6 Preference Shares. The Series 6 Preference Shares are convertible at the Company’s option (i) on and after the two -year anniversary of the Series 6 Issue Date, if the closing trading price of the Class A Shares over a specified period prior to conversion is at least 125% of the Conversion Price or (ii) after the fifth anniversary of the Issue Date, if the closing trading price of the Class A Shares over a specified period prior to conversion is at least equal to the Conversion Price. Following certain change in control transactions of the Company in which holders of Series 6 Preference Shares are not entitled to receive cash or qualifying listed securities with a value at least equal to the liquidation preference plus accrued and unpaid dividends, (i) holders will be entitled to cash dividends on the liquidation preference at an increasing rate (beginning at 7% ), and (ii) the Company will have a right to redeem the Series 6 Preference Shares for cash at the greater of their liquidation preference plus accrued and unpaid dividends or their as-converted value. Effective March 18, 2019, the Company’s Board of Directors (the “Board”) appointed Mark Penn as the Chief Executive Officer and as a director of the Board. Mr. Penn is manager of Stagwell. Effective April 18, 2019, Mr. Penn was also appointed as Chairman of the Board. Series 4 Convertible Preference Shares On March 7, 2017 (the “Series 4 Issue Date”), the Company issued 95,000 newly created Preference Shares (“Series 4 Preference Shares”) to affiliates of The Goldman Sachs Group, Inc. (collectively, the “Purchaser”) pursuant to a $95,000 private placement. The Company received proceeds of approximately $90,123 , net of fees and estimated expenses, which were primarily used to pay down existing debt under the Company’s credit facility and for general corporate purposes. In connection with the closing of the transaction, the Company increased the size of its Board and appointed one nominee designated by the Purchaser. Except as required by law, the Series 4 Preference Shares do not have voting rights and are not redeemable at the option of the Purchaser. Subsequent to the ninetieth day following the Series 4 Issue Date, the holders of the Series 4 Preference Shares have the right to convert their Series 4 Preference Shares in whole at any time and from time to time and in part at any time and from time to time into a number of Class A Shares equal to the then-applicable liquidation preference divided by the applicable conversion price at such time (the “Conversion Price”). The initial liquidation per share preference of each Series 4 Preference Share is $1,000 . The Conversion Price of a Series 4 Preference Share is subject to customary adjustments for share splits and combinations, dividends, recapitalizations and other matters, including weighted average anti-dilution protection for certain issuances of equity or equity-linked securities. In connection with the anti-dilution protection provision triggered by the issuance of equity securities to Stagwell, the Conversion Price per Series 4 Preference Share was reduced to $7.42 from the initial Conversion Price of $10.00 . The Series 4 Preference Shares’ liquidation preference accretes at 8.0% per annum, compounded quarterly until the five-year anniversary of the Series 4 Issue Date. During the six months ended June 30, 2019 , the Series 4 Preference Shares accreted at a monthly rate of approximately $7.85 per Series 4 Preference Share, for total accretion of $4,432 , bringing the aggregate liquidation preference to $114,139 as of June 30, 2019 . The accretion is considered in the calculation of net income (loss) attributable to MDC Partners Inc. common shareholders. See Note 3 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for further information regarding the Series 4 Preference Shares. Holders of the Series 4 Preference Shares are entitled to dividends in an amount equal to any dividends that would otherwise have been payable on the Class A Shares issued upon conversion of the Series 4 Preference Shares. The Series 4 Preference Shares are convertible at the Company’s option (i) on and after the two-year anniversary of the Issue Date, if the closing trading price of the Class A Shares over a specified period prior to conversion is at least 125% of the Conversion Price or (ii) after the fifth anniversary of the Series 4 Issue Date, if the closing trading price of the Class A Shares over a specified period prior to conversion is at least equal to the Conversion Price. Following certain change in control transactions of the Company in which holders of Series 4 Preference Shares are not entitled to receive cash or qualifying listed securities with a value at least equal to the liquidation preference plus accrued and unpaid dividends, (i) holders will be entitled to cash dividends on the liquidation preference at an increasing rate (beginning at 7% ), and (ii) the Company will have a right to redeem the Series 4 Preference Shares for cash at the greater of their liquidation preference plus accrued and unpaid dividends or their as-converted value. Class A Common Shares (“Class A Shares”) An unlimited number of subordinate voting shares, carrying one vote each, entitled to dividends equal to or greater than Class B Shares, convertible at the option of the holder into one Class B Share for each Class A Share after the occurrence of certain events related to an offer to purchase all Class B shares. There were 71,943,994 (including the Class A Shares issued to Stagwell) and 57,517,568 Class A Shares issued and outstanding as of June 30, 2019 and December 31, 2018 , respectively. Class B Common Shares (“Class B Shares”) An unlimited number of voting shares, carrying twenty votes each, convertible at any time at the option of the holder into one Class A share for each Class B share. There were 3,749 and 3,755 Class B Shares issued and outstanding as of June 30, 2019 and December 31, 2018 , respectively. |
Noncontrolling and Redeemable N
Noncontrolling and Redeemable Noncontrolling Interests | 6 Months Ended |
Jun. 30, 2019 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling and Redeemable Noncontrolling Interests | When acquiring less than 100% ownership of an entity, the Company may enter into agreements that give the Company an option to purchase, or require the Company to purchase, the incremental ownership interests under certain circumstances. Where the option to purchase the incremental ownership is within the Company’s control, the amounts are recorded as noncontrolling interests in the equity section of the Company’s Unaudited Condensed Consolidated Balance Sheets . Where the incremental purchase may be required of the Company, the amounts are recorded as redeemable noncontrolling interests in mezzanine equity at their estimated acquisition date redemption value and adjusted at each reporting period for changes to their estimated redemption value through additional paid-in capital (but not less than their initial redemption value), except for foreign currency translation adjustments. On occasion, the Company may initiate a renegotiation to acquire an incremental ownership interest and the amount of consideration paid may differ materially from the amounts recorded in the Company’s Unaudited Condensed Consolidated Balance Sheets . Noncontrolling Interests Changes in amounts due to noncontrolling interest holders included in accruals and other liabilities on the Unaudited Condensed Consolidated Balance Sheets for the year ended December 31, 2018 and six months ended June 30, 2019 were as follows: Noncontrolling Balance, December 31, 2017 $ 11,030 Income attributable to noncontrolling interests 11,785 Distributions made (13,419 ) Other (1) (118 ) Balance, December 31, 2018 $ 9,278 Income attributable to noncontrolling interests 3,472 Distributions made (7,957 ) Other (1) 25 Balance, June 30, 2019 $ 4,818 (1) Other consists of cumulative translation adjustments. Changes in the Company’s ownership interests in our less than 100% owned subsidiaries during the three and six months ended June 30, 2019 and 2018 were as follows: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Net income (loss) attributable to MDC Partners Inc. $ 4,290 $ 3,406 $ 4,177 $ (26,010 ) Transfers from the noncontrolling interest: Decrease in MDC Partners Inc. paid-in capital for purchase of equity interests in excess of redeemable noncontrolling interests and noncontrolling interests (97 ) — (97 ) (1,166 ) Net transfers from noncontrolling interests $ (97 ) $ — $ (97 ) $ (1,166 ) Change from net loss attributable to MDC Partners Inc. and transfers to noncontrolling interests $ 4,193 $ 3,406 $ 4,080 $ (27,176 ) Redeemable Noncontrolling Interests The following table presents changes in redeemable noncontrolling interests: Six Months Ended June 30, 2019 Year Ended December 31, 2018 Beginning Balance $ 51,546 $ 62,886 Redemptions (9,486 ) (11,943 ) Granted — — Changes in redemption value 421 1,067 Currency translation adjustments 154 (464 ) Ending Balance $ 42,635 $ 51,546 The noncontrolling shareholders’ ability to exercise any such option right is subject to the satisfaction of certain conditions, including conditions requiring notice in advance of exercise and specific employment termination conditions. In addition, these rights cannot be exercised prior to specified staggered exercise dates. The exercise of these rights at their earliest contractual date would result in obligations of the Company to fund the related amounts during 2019 to 2024. It is not determinable, at this time, if or when the owners of these rights will exercise all or a portion of these rights. The redeemable noncontrolling interest of $42,635 as of June 30, 2019 , consists of $19,158 assuming that the subsidiaries perform over the relevant future periods at their discounted cash flows earnings level and such rights are exercised, $19,926 upon termination of such owner’s employment with the applicable subsidiary or death and $3,551 representing the initial redemption value (required floor) recorded for certain acquisitions in excess of the amount the Company would have to pay should the Company acquire the remaining ownership interests for such subsidiaries. These adjustments will not impact the calculation of earnings (loss) per share if the redemption values are less than the estimated fair values. For the three months ended June 30, 2019 and 2018 , there was no related impact on the Company’s loss per share calculation. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements A fair value measurement assumes a transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. The hierarchy for observable and unobservable inputs used to measure fair value into three broad levels are described below: • Level 1 - Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. • Level 2 - Observable prices that are based on inputs not quoted on active markets, but corroborated by market data. • Level 3 - Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. Financial Liabilities that are not Measured at Fair Value on a Recurring Basis The following table presents certain information for our financial liability that is not measured at fair value on a recurring basis at June 30, 2019 and December 31, 2018 : June 30, 2019 December 31, 2018 Carrying Fair Value Carrying Fair Value Liabilities: 6.50% Senior Notes due 2024 $ 900,000 $ 823,500 $ 900,000 $ 834,750 Our long-term debt includes fixed rate debt. The fair value of this instrument is based on quoted market prices in markets that are not active. Therefore, this debt is classified as Level 2 within the fair value hierarchy. Financial Liabilities Measured at Fair Value on a Recurring Basis Contingent deferred acquisition consideration are recorded at the acquisition date fair value and adjusted at each reporting period. The estimated liability is determined in accordance with various contractual valuation formulas that may be dependent upon future events, such as the growth rate of the earnings of the relevant subsidiary during the contractual period and, in some cases, the currency exchange rate as of the date of payment (Level 3). See Note 5 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for additional information regarding contingent deferred acquisition consideration. At June 30, 2019 and December 31, 2018 , the carrying amount of the Company’s financial instruments, including cash and cash equivalents, accounts receivable and accounts payable, approximated fair value because of their short-term maturity. Non-financial Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis Certain non-financial assets are measured at fair value on a nonrecurring basis, primarily goodwill and intangible assets (a Level 3 fair value assessment). Accordingly, these assets are not measured and adjusted to fair value on an ongoing basis but are subject to periodic evaluations for potential impairment. The Company did not recognize an impairment of goodwill or intangible assets in the three and six months ended June 30, 2019 or June 30, 2018 |
Supplemental Information
Supplemental Information | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Information | Supplemental Information Accounts Payable, Accruals and Other Liabilities At June 30, 2019 and December 31, 2018 , accruals and other liabilities included accrued media of $151,143 and $180,586 , respectively; and also included amounts due to noncontrolling interest holders for their share of profits. See Note 9 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for additional information regarding noncontrolling interest holders share of profits. Goodwill and Indefinite Lived Intangibles Goodwill and indefinite life intangible assets (trademarks) acquired as a result of a business combination which are not subject to amortization are tested for impairment annually as of October 1st of each year, or more frequently if indicators of potential impairment exist. For goodwill, impairment is assessed at the reporting unit level. Goodwill balances as of June 30, 2019 and December 31, 2018 , were $743,582 and $740,955 , respectively. Income Taxes Our tax provision for interim periods is determined using an estimated annual effective tax rate, adjusted for discrete items arising in interim periods. Income tax expense for the three months ended June 30, 2019 was $2,088 (on income of $9,215 resulting in an effective tax rate of 22.7% ) compared to an expense of $1,977 (on income of $7,956 resulting in an effective tax rate of 24.8% ) for the three months ended June 30, 2018 . The change in the effective tax rate was primarily driven by the jurisdictional mix of earnings. Income tax expense for the six months ended June 30, 2019 was $2,835 (on income of $10,195 resulting in an effective tax rate of 27.8%) compared to a benefit of $6,353 (on a loss of $28,979 resulting in an effective tax rate of 21.9%) for the six months ended June 30, 2018 . The change in the effective tax rate was primarily driven by the jurisdictional mix of earnings. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company determines an operating segment if a component (i) engages in business activities from which it earns revenues and incurs expenses, (ii) has discrete financial information, and is (iii) regularly reviewed by the Chief Operating Decision Maker (“CODM”) to make decisions regarding resource allocation for the segment and assess its performance. Once operating segments are identified, the Company performs an analysis to determine if aggregation of operating segments is applicable. This determination is based upon a quantitative analysis of the expected and historic average long-term profitability for each operating segment, together with a qualitative assessment to determine if operating segments have similar operating characteristics. Due to changes in the composition of certain business and the Company’s internal management and reporting structure during 2019, reportable segment results for the 2018 periods presented have been recast to reflect the reclassification of certain businesses between segments. The changes were as follows: • Doner, previously within the Global Integrated Agencies reportable segment is now included within the Domestic Creative Agencies reportable segment. • HL Group Partners, previously within the Specialist Communications reportable segment, and Redscout, previously within the All Other category, are now included in the Yes & Company operating segment. The Yes & Company operating segment previously within the Media Services reportable segment is now included within the Domestic Creative Agencies reportable segment. • Attention, previously within the Forsman & Bodenfors operating segment has operationally merged into MDC Media Partners, which is included within the Media Services reportable segment. The four reportable segments that result from applying the aggregation criteria are as follows: “Global Integrated Agencies”; “Domestic Creative Agencies”; “Specialist Communications”; and “Media Services.” In addition, the Company combines and discloses those operating segments that do not meet the aggregation criteria as “All Other.” The Company also reports corporate expenses, as further detailed below, as “Corporate.” All segments follow the same basis of presentation and accounting policies as those described throughout the Notes to the Unaudited Condensed Consolidated Financial Statements included herein and Note 2 of the Company’s Form 10-K for the year ended December 31, 2018. • The Global Integrated Agencies reportable segment is comprised of the Company’s four global, integrated operating segments (72andSunny, Anomaly, Crispin Porter + Bogusky, and Forsman & Bodenfors) serving multinational clients around the world. These operating segments share similar characteristics related to (i) the nature of their services; (ii) the type of global clients and the methods used to provide services; and (iii) the extent to which they may be impacted by global economic and geopolitical risks. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Global Integrated Agencies reportable segment. The operating segments within the Global Integrated Agencies reportable segment provides a range of different services for its clients, including strategy, creative and production for advertising campaigns across a variety of platforms (print, digital, social media, television broadcast). • The Domestic Creative Agencies reportable segment is comprised of seven operating segments that are primarily national advertising agencies (Colle + McVoy, Doner, Laird + Partners, Mono Advertising, Union, Yamamoto, and Yes & Company) leveraging creative capabilities at their core. These operating segments share similar characteristics related to (i) the nature of their services; (ii) the type of domestic client accounts and the methods used to provide services; and (iii) the extent to which they may be impacted by domestic economic and policy factors within North America. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long- term profitability is similar among the operating segments aggregated in the Domestic Creative Agencies reportable segment. The operating segments within the Domestic Creative Agencies reportable segment provide similar services as the Global Integrated Agencies. • The Specialist Communications reportable segment is comprised of four operating segments that are each communications agencies (Allison & Partners, Hunter, KWT Global, and Veritas) with core service offerings in public relations and related communications services. These operating segments share similar characteristics related to (i) the nature of their services; (ii) the type of client accounts and the methods used to provide services; (iii) the extent to which they may be impacted by domestic economic and policy factors within North America; and (iv) the regulatory environment regarding public relations and social media. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Specialist Communications reportable segment. The operating segments within the Specialist Communications reportable segment provide public relations and communications services including strategy, editorial, crisis support or issues management, media training, influencer engagement, and events management. • The Media Services reportable segment is comprised of a single operating segment known as MDC Media Partners. MDC Media Partners, which operates primarily in North America, performs media buying and planning as their core competency across a range of platforms (out-of-home, paid search, social media, lead generation, programmatic, television broadcast). • All Other consists of the Company’s remaining operating segments that provide a range of diverse marketing communication services, but generally do not have similar services offerings or financial characteristics as those aggregated in the reportable segments. The All Other category includes 6Degrees Communications, Concentric Partners, Gale Partners, Kenna, Kingsdale (through the date of sale on March 8, 2019), Instrument, Relevent, Team, Vitro, and Y Media Labs. The nature of the specialist services provided by these operating segments vary among each other and from those operating segments aggregated into the reportable segments. This results in these operating segments having current and long-term performance expectations inconsistent with those operating segments aggregated in the reportable segments. The operating segments within All Other provide a range of diverse marketing communication services, including application and website design and development, data and analytics, experiential marketing, customer research management, creative services, and branding. • Corporate consists of corporate office expenses incurred in connection with the strategic resources provided to the operating segments, as well as certain other centrally managed expenses that are not fully allocated to the operating segments. These office and general expenses include (i) salaries and related expenses for corporate office employees, including employees dedicated to supporting the operating segments, (ii) occupancy expenses relating to properties occupied by all corporate office employees, (iii) other office and general expenses including professional fees for the financial statement audits and other public company costs, and (iv) certain other professional fees managed by the corporate office. Additional expenses managed by the corporate office that are directly related to the operating segments are allocated to the appropriate reportable segment and the All Other category. Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Revenue: Global Integrated Agencies $ 154,368 $ 158,163 $ 284,087 $ 287,686 Domestic Creative Agencies 65,193 72,971 132,201 139,625 Specialist Communication 47,170 40,304 86,123 79,128 Media Services 21,331 21,398 41,510 46,082 All Other 74,068 86,907 147,000 154,190 Total $ 362,130 $ 379,743 $ 690,921 $ 706,711 Segment operating income (loss): Global Integrated Agencies $ 20,720 $ 18,352 $ 24,491 $ 4,760 Domestic Creative Agencies 8,730 5,077 14,207 7,955 Specialist Communication 6,683 6,216 13,760 9,944 Media Services 991 (1,719 ) (843 ) (1,738 ) All Other 2,949 15,986 8,962 22,430 Corporate (16,631 ) (13,140 ) (21,454 ) (27,212 ) Total $ 23,442 $ 30,772 $ 39,123 $ 16,139 Other Income (Expenses): Interest expense and finance charges, net $ (16,413 ) $ (16,859 ) $ (33,174 ) $ (32,942 ) Foreign exchange gain (loss) 2,932 (6,549 ) 8,374 (13,209 ) Other, net (746 ) 592 (4,128 ) 1,033 Income (loss) before income taxes and equity in earnings of non-consolidated affiliates 9,215 7,956 10,195 (28,979 ) Income tax expense (benefit) 2,088 1,977 2,835 (6,353 ) Income (loss) before equity in earnings of non-consolidated affiliates 7,127 5,979 7,360 (22,626 ) Equity in earnings (losses) of non-consolidated affiliates 206 (28 ) 289 58 Net income (loss) 7,333 5,951 7,649 (22,568 ) Net income attributable to the noncontrolling interest (3,043 ) (2,545 ) (3,472 ) (3,442 ) Net income (loss) attributable to MDC Partners Inc. $ 4,290 $ 3,406 $ 4,177 $ (26,010 ) Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Depreciation and amortization: Global Integrated Agencies $ 4,437 $ 4,743 $ 8,502 $ 12,152 Domestic Creative Agencies 1,547 1,281 2,786 2,574 Specialist Communication 698 992 1,265 1,959 Media Services 794 635 1,485 1,273 All Other 2,966 3,892 5,025 5,736 Corporate 221 160 438 384 Total $ 10,663 $ 11,703 $ 19,501 $ 24,078 Stock-based compensation: Global Integrated Agencies $ 1,232 $ 2,475 $ 4,999 $ 4,935 Domestic Creative Agencies 522 1,097 986 1,507 Specialist Communication 52 52 78 239 Media Services (16 ) 74 (16 ) 149 All Other 652 684 940 1,341 Corporate 1,192 1,221 (381 ) 2,469 Total $ 3,634 $ 5,603 $ 6,606 $ 10,640 Capital expenditures: Global Integrated Agencies $ 1,816 $ 2,411 $ 3,234 $ 4,654 Domestic Creative Agencies 369 569 1,063 1,473 Specialist Communication 231 2,208 482 2,443 Media Services 126 131 167 315 All Other 1,757 547 2,958 772 Corporate 18 24 19 32 Total $ 4,317 $ 5,890 $ 7,923 $ 9,689 The Company’s CODM does not use segment assets to allocate resources or to assess performance of the segments and therefore, total segment assets have not been disclosed. See Note 2 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for a summary of the Company’s revenue by geographic region for three months ended June 30, 2019 and 2018 . |
Commitments, Contingencies and
Commitments, Contingencies and Guarantees | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Guarantees | Commitments, Contingencies, and Guarantees Legal Proceedings. The Company’s operating entities are involved in legal proceedings of various types. While any litigation contains an element of uncertainty, the Company has no reason to believe that the outcome of such proceedings or claims will have a material adverse effect on the financial condition or results of operations of the Company. Deferred Acquisition Consideration and Options to Purchase. See Notes 5 and 9 of the Notes to the Unaudited Condensed Consolidated Financial Statements included herein for information regarding potential payments associated with deferred acquisition consideration and the acquisition of noncontrolling shareholders’ ownership interest in subsidiaries. Natural Disasters. Certain of the Company’s operations are located in regions of the United States which typically are subject to hurricanes. During the three and six months ended June 30, 2019 and 2018 these operations did not incur any material costs related to damages resulting from hurricanes. Guarantees . Generally, the Company has indemnified the purchasers of certain assets in the event that a third party asserts a claim against the purchaser that relates to a liability retained by the Company. These types of indemnification guarantees typically extend for a number of years. Historically, the Company has not made any significant indemnification payments under such agreements and no amount has been accrued in the accompanying consolidated financial statements with respect to these indemnification guarantees. The Company continues to monitor the conditions that are subject to guarantees and indemnifications to identify whether it is probable that a loss has occurred and would recognize any such losses under any guarantees or indemnifications in the period when those losses are probable and estimable. Commitments. At June 30, 2019 , the Company had $4,744 of undrawn letters of credit. |
New Accounting Pronouncements
New Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2019 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Adopted In The Current Reporting Period Effective January 1, 2019, the Company adopted ASC 842. As a result, comparative prior periods have not been adjusted and continue to be reported under FASB ASC Topic 840, Leases. With the adoption of ASC 842, the Company has elected to apply the package of practical expedients: (1) whether a contract is or contains a lease, (2) the classification of existing leases, and (3) whether previously capitalized costs continue to qualify as initial indirect costs. Additionally, the Company elected the practical expedient to not separate non-lease components from lease components for all operating leases. The adoption of ASC 842 had a material impact on the Company’s Unaudited Condensed Consolidated Balance Sheets , resulting in the recognition, on January 1, 2019, of a lease liability of $299,243 which represents the present value of the remaining lease payments, and a right-of-use asset of $254,245 which represents the lease liability, offset by adjustments as appropriate under ASC 842. The adoption of ASC 842 did not have a material impact on the Company’s other Unaudited Condensed Consolidated Financial Statements . |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
By Location | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue | The following table presents revenue disaggregated by geography for the three and six months ended June 30, 2019 and 2018 : |
Industry Vertical | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue | The following table presents revenue disaggregated by client industry vertical for the three and six months ended June 30, 2019 and 2018 : Three Months Ended June 30, Six Months Ended June 30, Industry Reportable Segment 2019 2018 2019 2018 Food & Beverage All $ 73,305 $ 84,464 $ 139,969 $ 147,932 Retail All 39,894 38,396 72,350 76,411 Consumer Products All 45,296 41,367 78,232 77,973 Communications All 47,793 43,097 87,490 81,454 Automotive All 18,541 25,294 36,732 45,788 Technology All 28,876 23,540 54,279 45,080 Healthcare All 25,954 35,426 49,161 68,002 Financials All 27,868 30,207 52,795 52,702 Transportation and Travel/Lodging All 27,050 18,776 44,085 33,664 Other All 27,553 39,176 75,828 77,705 $ 362,130 $ 379,743 $ 690,921 $ 706,711 |
Loss Per Common Share (Tables)
Loss Per Common Share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Numerator and Denominator in Earnings Per Share | The following table sets forth the computation of basic and diluted income (loss) per common share: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Numerator: Net income (loss) attributable to MDC Partners Inc. $ 4,290 $ 3,406 $ 4,177 $ (26,010 ) Accretion on convertible preference shares (3,242 ) (2,068 ) (5,625 ) (4,095 ) Net income allocated to convertible preference shares (273 ) (205 ) — — Net income (loss) attributable to MDC Partners Inc. common shareholders $ 775 $ 1,133 $ (1,448 ) $ (30,105 ) Adjustment to net income allocated to convertible preference shares — 1 — — Numerator for dilutive income (loss) per common share: Net income (loss) attributable to MDC Partners Inc. common shareholders $ 775 $ 1,134 $ (1,448 ) $ (30,105 ) Denominator: Basic weighted average number of common shares outstanding 71,915,832 57,439,823 66,118,749 56,924,208 Effect of dilutive securities: Impact of stock options and non-vested stock under employee stock incentive plans 108,857 363,049 — — Diluted weighted average number of common shares outstanding 72,024,689 57,802,872 66,118,749 56,924,208 Basic $ 0.01 $ 0.02 $ (0.02 ) $ (0.53 ) Diluted $ 0.01 $ 0.02 $ (0.02 ) $ (0.53 ) |
Deferred Acquisition Consider_2
Deferred Acquisition Consideration (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of Changes in Contingent Deferred Acquisition Consideration | The following table presents changes in contingent deferred acquisition consideration, which is measured at fair value on a recurring basis using significant unobservable inputs, and a reconciliation to the amounts reported on the balance sheets as of June 30, 2019 and December 31, 2018 . June 30, December 31, 2019 2018 Beginning Balance of contingent payments $ 82,598 $ 119,086 Payments (24,492 ) (54,947 ) Redemption value adjustments (1) (6,100 ) 3,512 Additions - acquisitions and step up transactions 5,695 14,943 Other — 4 Ending Balance of contingent payments $ 57,701 $ 82,598 Fixed payments 542 1,097 $ 58,243 $ 83,695 (1) Redemption value adjustments are fair value changes from the Company’s initial estimates of deferred acquisition payments and stock-based compensation charges relating to acquisition payments that are tied to continued employment. Redemption value adjustments are recorded within cost of services sold and office and general expenses on the Unaudited Condensed Consolidated Statements of Operations. The following table presents the impact to the Company’s statement of operations due to the redemption value adjustments for the contingent deferred acquisition consideration: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Income (loss) attributable to fair value adjustments $ 2,073 $ (5,065 ) $ (5,570 ) $ (2,479 ) Stock-based compensation (1,339 ) 2,321 (530 ) 4,682 Redemption value adjustments $ 734 $ (2,744 ) $ (6,100 ) $ 2,203 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Lease Costs and Other Quantitative Information | The following table presents lease costs and other quantitative information for the three and six months ended June 30, 2019 : Three Months Ended June 30, Six Months Ended June 30, 2019 2019 Lease Cost: Operating lease cost $ 17,473 $ 33,914 Variable lease cost 4,361 9,325 Sublease rental income (2,590 ) (4,189 ) Total lease cost $ 19,244 $ 39,050 Additional information: Cash paid for amounts included in the measurement of lease liabilities for operating leases Operating cash flows $ 19,523 $ 35,175 Right-of-use assets obtained in exchange for operating lease liabilities $ 2,195 $ 259,013 Weighted average remaining lease term (in years) - Operating leases 7.0 7.0 Weighted average discount rate - Operating leases 8.6 8.6 |
Minimum Future Rental Payments | The following table presents minimum future rental payments under the Company’s leases at June 30, 2019 and their reconciliation to the corresponding lease liabilities: Maturity Analysis Remaining 2019 $ 33,776 2020 66,425 2021 56,428 2022 45,942 2023 42,113 Thereafter 133,823 Total 378,507 Less: Present value discount (99,004 ) Lease liability $ 279,503 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | June 30, 2019 December 31, 2018 Revolving credit agreement $ 27,545 $ 68,143 6.50% Notes due 2024 900,000 900,000 Debt issuance costs (13,453 ) (14,036 ) $ 914,092 $ 954,107 |
Noncontrolling and Redeemable_2
Noncontrolling and Redeemable Noncontrolling Interests (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Noncontrolling Interest [Abstract] | |
Change In Noncontrolling Interest [Table Text Block] | Changes in amounts due to noncontrolling interest holders included in accruals and other liabilities on the Unaudited Condensed Consolidated Balance Sheets for the year ended December 31, 2018 and six months ended June 30, 2019 were as follows: Noncontrolling Balance, December 31, 2017 $ 11,030 Income attributable to noncontrolling interests 11,785 Distributions made (13,419 ) Other (1) (118 ) Balance, December 31, 2018 $ 9,278 Income attributable to noncontrolling interests 3,472 Distributions made (7,957 ) Other (1) 25 Balance, June 30, 2019 $ 4,818 |
Noncontrolling Interest [Table Text Block] | Changes in the Company’s ownership interests in our less than 100% owned subsidiaries during the three and six months ended June 30, 2019 and 2018 were as follows: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Net income (loss) attributable to MDC Partners Inc. $ 4,290 $ 3,406 $ 4,177 $ (26,010 ) Transfers from the noncontrolling interest: Decrease in MDC Partners Inc. paid-in capital for purchase of equity interests in excess of redeemable noncontrolling interests and noncontrolling interests (97 ) — (97 ) (1,166 ) Net transfers from noncontrolling interests $ (97 ) $ — $ (97 ) $ (1,166 ) Change from net loss attributable to MDC Partners Inc. and transfers to noncontrolling interests $ 4,193 $ 3,406 $ 4,080 $ (27,176 ) |
Redeemable Noncontrolling Interest [Table Text Block] | The following table presents changes in redeemable noncontrolling interests: Six Months Ended June 30, 2019 Year Ended December 31, 2018 Beginning Balance $ 51,546 $ 62,886 Redemptions (9,486 ) (11,943 ) Granted — — Changes in redemption value 421 1,067 Currency translation adjustments 154 (464 ) Ending Balance $ 42,635 $ 51,546 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Liability Measured on a Non-recurring Basis | The following table presents certain information for our financial liability that is not measured at fair value on a recurring basis at June 30, 2019 and December 31, 2018 : June 30, 2019 December 31, 2018 Carrying Fair Value Carrying Fair Value Liabilities: 6.50% Senior Notes due 2024 $ 900,000 $ 823,500 $ 900,000 $ 834,750 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Revenue: Global Integrated Agencies $ 154,368 $ 158,163 $ 284,087 $ 287,686 Domestic Creative Agencies 65,193 72,971 132,201 139,625 Specialist Communication 47,170 40,304 86,123 79,128 Media Services 21,331 21,398 41,510 46,082 All Other 74,068 86,907 147,000 154,190 Total $ 362,130 $ 379,743 $ 690,921 $ 706,711 Segment operating income (loss): Global Integrated Agencies $ 20,720 $ 18,352 $ 24,491 $ 4,760 Domestic Creative Agencies 8,730 5,077 14,207 7,955 Specialist Communication 6,683 6,216 13,760 9,944 Media Services 991 (1,719 ) (843 ) (1,738 ) All Other 2,949 15,986 8,962 22,430 Corporate (16,631 ) (13,140 ) (21,454 ) (27,212 ) Total $ 23,442 $ 30,772 $ 39,123 $ 16,139 Other Income (Expenses): Interest expense and finance charges, net $ (16,413 ) $ (16,859 ) $ (33,174 ) $ (32,942 ) Foreign exchange gain (loss) 2,932 (6,549 ) 8,374 (13,209 ) Other, net (746 ) 592 (4,128 ) 1,033 Income (loss) before income taxes and equity in earnings of non-consolidated affiliates 9,215 7,956 10,195 (28,979 ) Income tax expense (benefit) 2,088 1,977 2,835 (6,353 ) Income (loss) before equity in earnings of non-consolidated affiliates 7,127 5,979 7,360 (22,626 ) Equity in earnings (losses) of non-consolidated affiliates 206 (28 ) 289 58 Net income (loss) 7,333 5,951 7,649 (22,568 ) Net income attributable to the noncontrolling interest (3,043 ) (2,545 ) (3,472 ) (3,442 ) Net income (loss) attributable to MDC Partners Inc. $ 4,290 $ 3,406 $ 4,177 $ (26,010 ) Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Depreciation and amortization: Global Integrated Agencies $ 4,437 $ 4,743 $ 8,502 $ 12,152 Domestic Creative Agencies 1,547 1,281 2,786 2,574 Specialist Communication 698 992 1,265 1,959 Media Services 794 635 1,485 1,273 All Other 2,966 3,892 5,025 5,736 Corporate 221 160 438 384 Total $ 10,663 $ 11,703 $ 19,501 $ 24,078 Stock-based compensation: Global Integrated Agencies $ 1,232 $ 2,475 $ 4,999 $ 4,935 Domestic Creative Agencies 522 1,097 986 1,507 Specialist Communication 52 52 78 239 Media Services (16 ) 74 (16 ) 149 All Other 652 684 940 1,341 Corporate 1,192 1,221 (381 ) 2,469 Total $ 3,634 $ 5,603 $ 6,606 $ 10,640 Capital expenditures: Global Integrated Agencies $ 1,816 $ 2,411 $ 3,234 $ 4,654 Domestic Creative Agencies 369 569 1,063 1,473 Specialist Communication 231 2,208 482 2,443 Media Services 126 131 167 315 All Other 1,757 547 2,958 772 Corporate 18 24 19 32 Total $ 4,317 $ 5,890 $ 7,923 $ 9,689 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Services | $ 362,130 | $ 379,743 | $ 690,921 | $ 706,711 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 284,659 | 295,268 | 547,676 | 551,792 |
Canada | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 24,564 | 33,086 | 46,942 | 59,465 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 52,907 | 51,389 | 96,303 | 95,454 |
Food & Beverage | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 73,305 | 84,464 | 139,969 | 147,932 |
Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 39,894 | 38,396 | 72,350 | 76,411 |
Consumer Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 45,296 | 41,367 | 78,232 | 77,973 |
Communications | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 47,793 | 43,097 | 87,490 | 81,454 |
Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 18,541 | 25,294 | 36,732 | 45,788 |
Technology | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 28,876 | 23,540 | 54,279 | 45,080 |
Healthcare | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 25,954 | 35,426 | 49,161 | 68,002 |
Financials | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 27,868 | 30,207 | 52,795 | 52,702 |
Transportation and Travel/Lodging | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | 27,050 | 18,776 | 44,085 | 33,664 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Services | $ 27,553 | $ 39,176 | $ 75,828 | $ 77,705 |
Revenue - Contract Assets and L
Revenue - Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | ||
Unbilled service fees | $ 92,317 | $ 64,362 |
Unbilled outside vendor costs, billable to clients | 40,605 | 42,369 |
Advance billings | 168,142 | $ 138,505 |
Increase in advance billings | 29,637 | |
Revenue recognized | $ 101,431 |
Loss Per Common Share (Details)
Loss Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Class of Stock [Line Items] | ||||||
Net loss attributable to MDC Partners Inc. | $ 4,290 | $ 3,406 | $ 3,406 | $ 4,177 | $ (26,010) | |
Numerator | ||||||
Accretion on convertible preference shares | 2,273 | |||||
Net loss attributable to MDC Partners Inc. common shareholders | $ 775 | $ 1,133 | $ (1,448) | $ (30,105) | ||
Denominator | ||||||
Denominator for basic income (loss) per common share - weighted average common shares | 71,915,832 | 57,439,823 | 66,118,749 | 56,924,208 | ||
Weighted Average Number Diluted Shares Outstanding Adjustment | 108,857 | 363,049 | 0 | 0 | ||
Denominator for diluted income (loss) per common share - adjusted weighted shares and assumed conversions | 72,024,689 | 57,802,872 | 66,118,749 | 56,924,208 | ||
Income (loss) from continuing operations attributable to MDC Partners Inc. common shareholders (usd per share) | $ 0.01 | $ 0.02 | $ (0.02) | $ (0.53) | ||
Income (loss) from continuing operations attributable to MDC Partners Inc. common shareholders (usd per share) | $ 0.01 | $ 0.02 | $ (0.02) | $ (0.53) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,662,666,000 | 4,406,206 | 327,500 | |||
Adjustment to Net Income, Allocated to Convertible Shares | $ 0 | $ 1 | $ 0 | $ 0 | ||
Income (Loss) from Continuing Operations Attributable to Parent, Diluted | 775 | 1,134 | (1,448) | (30,105) | ||
MDC Partners Inc. Shareholders' Deficit | ||||||
Class of Stock [Line Items] | ||||||
Net loss attributable to MDC Partners Inc. | $ 3,406 | (26,010) | ||||
Series 4 Convertible Preferred Stock | Convertible Preferred Stock | ||||||
Numerator | ||||||
Accretion on convertible preference shares | 3,242 | 2,068 | 5,625 | $ 4,095 | ||
Net Income Allocated to Convertible Shares | (273) | $ (205) | $ 0 | |||
Denominator | ||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 327,500,000 | 4,406,206,000 | 1,594,761,000 | |||
Series 4 Convertible Preferred Stock [Domain] | Convertible Preferred Stock | ||||||
Numerator | ||||||
Accretion on convertible preference shares | $ 3,515 | $ 4,095 | ||||
Net Income Allocated to Convertible Shares | $ 0 |
Loss Per Common Share (Details
Loss Per Common Share (Details Textual) - shares | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Antidilutive securities excluded from computation of earnings per share (shares) | 2,662,666,000 | 4,406,206 | 327,500 | |||||
Contingent Restricted Stock Units (RSUs) | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Antidilutive securities excluded from computation of earnings per share (shares) | 242,338 | 1,308,781 | ||||||
Convertible Preferred Stock | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Shares outstanding (shares) | 145,000,000 | 95,000,000 | 145,000,000 | 95,000,000 | ||||
Series 4 Convertible Preferred Stock | Convertible Preferred Stock | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Antidilutive securities excluded from computation of earnings per share (shares) | 327,500,000 | 4,406,206,000 | 1,594,761,000 | |||||
Shares outstanding (shares) | 145,000 | 145,000 | 95,000 | |||||
Convertible preferred stock, common shares issuable upon conversion (shares) | 25,621,189 | 25,621,189 | 10,544,708 | |||||
Series 6 Convertible Preferred Stock | Convertible Preferred Stock | ||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||||||
Shares outstanding (shares) | 50,000 | 50,000 | ||||||
Convertible preferred stock, common shares issuable upon conversion (shares) | 10,238,533 | 10,238,533 |
Acquisitions and Dispositions (
Acquisitions and Dispositions (Details Textual) - USD ($) | Apr. 01, 2019 | Mar. 08, 2019 | Sep. 07, 2018 | Jul. 01, 2018 | Apr. 02, 2018 | Jan. 01, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 |
Business Acquisition [Line Items] | ||||||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Purchases | $ 5,695,000 | |||||||||||
Goodwill | $ 743,582,000 | 743,582,000 | $ 740,955,000 | |||||||||
Deferred acquisition consideration | 58,243,000 | 58,243,000 | ||||||||||
Business acquisitions and step-up transactions, net of tax | $ (97,000) | $ 27,357,000 | $ 26,191,000 | |||||||||
Granted | $ 0 | 0 | ||||||||||
Aggregate 2019 Step-up Transaction [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Closing cash payment | $ 4,000 | |||||||||||
Business Acquisition Deferred Acquisition Consideration | $ 5,695 | |||||||||||
Aggregate 2018 Step-up Transaction [Member] [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Closing cash payment | $ 3,279,000 | |||||||||||
Business Acquisition Deferred Acquisition Consideration | 4,305 | |||||||||||
Instrument LLC [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Remaining ownership interest acquired (percent) | 51.00% | |||||||||||
Business Combination, Consideration Transferred, Other | $ 10,304,000 | |||||||||||
Finite-lived Intangible Assets Acquired | 23,130,000 | |||||||||||
Goodwill | 32,776 | |||||||||||
Aggregate purchase price | 35,591,000 | |||||||||||
Closing cash payment | 28,561,000 | |||||||||||
Granted | $ 27,357,000 | |||||||||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 6 years | |||||||||||
Allison & Partners LLC | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Remaining ownership interest acquired (percent) | 24.50% | |||||||||||
Aggregate purchase price | $ 10,023,000 | |||||||||||
Closing cash payment | 300,000 | |||||||||||
Deferred acquisition consideration | 9,723,000 | |||||||||||
Business Combination, Consideration Transferred, Including Equity Interest in Acquiree Held Prior to Combination | 20,096 | |||||||||||
Business acquisitions and step-up transactions, net of tax | (8,857,000) | |||||||||||
Granted | $ 1,166,000 | |||||||||||
Common Stock [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Stock Issued During Period, Shares, Acquisitions | 1,011,561 | 1,011,561 | ||||||||||
Hunter PR LLC [Member] [Domain] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Remaining ownership interest acquired (percent) | 35.00% | |||||||||||
Aggregate purchase price | $ 10,000 | |||||||||||
Reduction in noncontrolling interests | $ 9,000 | |||||||||||
OneChocolate [Domain] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Remaining ownership interest acquired (percent) | 100.00% | |||||||||||
Aggregate purchase price | $ 3,231,000 | |||||||||||
Business Acquisition Working Capital Payments | 966 | |||||||||||
Doner [Domain] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Remaining ownership interest acquired (percent) | 14.87% | |||||||||||
Business Combination, Consideration Transferred, Including Equity Interest in Acquiree Held Prior to Combination | $ 16,361 | |||||||||||
Source [Domain] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Remaining ownership interest acquired (percent) | 3.00% | |||||||||||
Doner and Source [Domain] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Aggregate purchase price | $ 7,618,000 | |||||||||||
Business acquisitions and step-up transactions, net of tax | (11,946,000) | |||||||||||
Reduction in noncontrolling interests | $ 933,000 | |||||||||||
Common Class A [Member] | Common Stock [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Stock Issued During Period, Value, Acquisitions | $ 7,030,000 | $ 7,030,000 | ||||||||||
Common Class A [Member] | Common Stock [Member] | Instrument LLC [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Stock Issued During Period, Shares, Acquisitions | 1,011,561 | |||||||||||
Stock Issued During Period, Value, Acquisitions | $ 7,030,000 | |||||||||||
Kingsdale Partners LP [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Proceeds from Divestiture of Businesses | $ 50,000,000 | |||||||||||
Loss on disposition of business | $ (3,000,000) |
Deferred Acquisition Consider_3
Deferred Acquisition Consideration (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Payments | $ 24,492 | |||
Redemption value adjustments | $ 734 | $ (2,744) | (6,100) | |
Additions | 5,695 | |||
Foreign translation adjustment | 0 | |||
Ending balance of contingent payments | 57,701 | 57,701 | ||
Deferred acquisition consideration | 58,243 | 58,243 | ||
Stock-based compensation | (1,339) | 2,321 | (530) | $ 4,682 |
Fixed payments | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Deferred acquisition consideration | 542 | 542 | ||
Contingent Payment | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Income (loss) attributable to fair value adjustments | $ 2,073 | $ (5,065) | $ (5,570) | $ (2,479) |
Leases - Lease Costs and Other
Leases - Lease Costs and Other Quantitative Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Leases [Abstract] | ||||
Operating lease cost | $ 17,473 | $ 15,981 | $ 33,914 | $ 34 |
Variable lease cost | 4,361 | 9,325 | ||
Sublease rental income | (2,590) | $ (926) | (4,189) | $ (2) |
Total lease cost | 19,244 | 39,050 | ||
Operating cash flows | 19,523 | 35,175 | ||
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 2,195 | $ 259,013 | ||
Weighted average discount rate - Operating leases | 863.00% | 863.00% |
Leases - Minimum Future Rental
Leases - Minimum Future Rental Payments (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Leases [Abstract] | |
Remaining 2019 | $ 33,776 |
2020 | 66,425 |
2021 | 56,428 |
2022 | 45,942 |
2023 | 42,113 |
Thereafter | 133,823 |
Total | 378,507 |
Less: Present value discount | (99,004) |
Lease liability | $ 279,503 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Leases [Abstract] | ||||
Leases not yet commenced, liability | $ 6,000 | $ 6,000 | ||
Operating lease cost | 17,473 | $ 15,981 | 33,914 | $ 34 |
Sublease rental income | $ 2,590 | $ 926 | $ 4,189 | $ 2 |
Debt (Details)
Debt (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Debt [Line Items] | |
Revolving credit agreement | $ 27,545 |
Debt issuance costs | (13,453) |
Debt, Long-term and Short-term, Combined Amount, Total | 914,092 |
6.50% Notes due 2024 | |
Debt [Line Items] | |
Senior Notes | $ 900,000 |
Debt (Details Textual)
Debt (Details Textual) | May 01, 2024 | Mar. 23, 2016USD ($) | Jun. 30, 2018 | Dec. 31, 2020 | Jun. 30, 2019USD ($) | Mar. 12, 2019USD ($) | Sep. 30, 2018 | May 03, 2016USD ($) |
Debt [Line Items] | ||||||||
Amount outstanding under the line of credit | $ 27,545,000 | |||||||
Amount of letters of credit outstanding | $ 4,744,000 | |||||||
Wells Fargo Capital Finance, LLC | Base Rate | ||||||||
Debt [Line Items] | ||||||||
Interest rate, stated percentage | 1.50% | |||||||
Wells Fargo Capital Finance, LLC | Non-Prime Rate and Prime Rate on European Advances | ||||||||
Debt [Line Items] | ||||||||
Interest rate, stated percentage | 0.75% | |||||||
Wells Fargo Capital Finance, LLC | Revolving Credit Facility [Member] | ||||||||
Debt [Line Items] | ||||||||
Maximum borrowing capacity | $ 325,000,000 | |||||||
Ratio of Indebtedness to Net Capital | 5.5 | |||||||
Senior Notes | 6.50% Notes due 2024 | ||||||||
Debt [Line Items] | ||||||||
Aggregate principal amount | $ 900,000 | |||||||
Interest rate, stated percentage | 6.50% | 6.50% | ||||||
Debt instrument, maturity date | May 1, 2024 | |||||||
Debt instrument, redemption date, one | May 1, 2019 | |||||||
Line of Credit [Member] | Amendment, Credit Agreement [Member] | ||||||||
Debt [Line Items] | ||||||||
Maximum borrowing capacity | $ 250,000,000 | |||||||
Ratio of Indebtedness to Net Capital | 6.25 | |||||||
Forecast | Wells Fargo Capital Finance, LLC | 6.50% Notes due 2024 | ||||||||
Debt [Line Items] | ||||||||
Debt instrument, maturity date | May 1, 2024 | |||||||
Forecast | Line of Credit [Member] | Amendment, Credit Agreement [Member] | ||||||||
Debt [Line Items] | ||||||||
Ratio of Indebtedness to Net Capital | 5.5 |
Share Capital (Details Textual)
Share Capital (Details Textual) $ / shares in Units, $ in Thousands | Mar. 14, 2019USD ($)$ / sharesshares | Mar. 07, 2017USD ($)$ / sharesshares | Jun. 30, 2019USD ($)voteshares | Jun. 30, 2019USD ($)vote$ / sharesshares | Jun. 30, 2018USD ($) | Sep. 30, 2018 | Dec. 31, 2018shares | Mar. 31, 2018shares | Dec. 31, 2017shares |
Share Capital [Line Items] | |||||||||
Issuance of common and convertible preference shares | $ 991 | $ 98,620 | |||||||
Expenses for convertible preference shares | $ (97) | ||||||||
Series 4 Convertible Preferred Stock | |||||||||
Share Capital [Line Items] | |||||||||
Proceeds from issuance of common and convertible preference shares, net of issuance costs | 98,620 | ||||||||
Preferred Stock | |||||||||
Share Capital [Line Items] | |||||||||
Proceeds from issuance of common and convertible preference shares, net of issuance costs | $ 98,620 | ||||||||
Issuance of common and convertible preference shares | $ 629 | $ 62,623 | |||||||
Shares outstanding (shares) | shares | 145,000,000 | 145,000,000 | 95,000,000 | 95,000,000 | |||||
Preferred Stock | Series 4 Convertible Preferred Stock | |||||||||
Share Capital [Line Items] | |||||||||
Proceeds from issuance of common and convertible preference shares, net of issuance costs | $ 95,000 | ||||||||
Preferred Stock, Liquidation Preference Per Share | $ / shares | $ 1,000 | ||||||||
Preferred Stock, Conversion Price Per Preference Share | $ / shares | $ 7.42 | $ 10 | |||||||
Preferred Stock, Accretion Percentage, Preference | 8.00% | ||||||||
Preferred Stock, Accretion Rate, Preference Per Share | $ / shares | $ 7.85 | ||||||||
Preferred Stock, Accretion of Redemption Discount | $ 4,432 | ||||||||
Preferred Stock, Liquidation Preference, Value | $ 114,139 | $ 114,139 | |||||||
Shares outstanding (shares) | shares | 145,000 | 145,000 | 95,000 | ||||||
Expenses for convertible preference shares | $ (97) | ||||||||
Preferred Stock, Conversion Basis, Common Stock Class A Closing Trade Price | 125.00% | ||||||||
Preferred Stock, Liquidation Preference Percentage Rate, Change of Control of the Company | 7.00% | ||||||||
Stock issued during period, convertible preferred (shares) | shares | 95,000 | ||||||||
Preferred Stock | Series 6 Convertible Preferred Stock | |||||||||
Share Capital [Line Items] | |||||||||
Stock Issued During Period, Shares, Issued For Services, Convertible Preferred Shares | shares | 50,000,000 | ||||||||
Proceeds from issuance of common and convertible preference shares, net of issuance costs | $ 50,000 | ||||||||
Preferred Stock, Liquidation Preference Per Share | $ / shares | $ 1,000 | ||||||||
Preferred Stock, Conversion Price Per Preference Share | $ / shares | $ 5 | ||||||||
Preferred Stock, Accretion Percentage, Preference | 8.00% | ||||||||
Preferred Stock, Convertible Preference Shares, Accretion Period | 5 years | ||||||||
Preferred Stock, Accretion of Redemption Discount | $ 1,193 | ||||||||
Preferred Stock, Liquidation Preference, Value | $ 51,193 | $ 51,193 | |||||||
Shares outstanding (shares) | shares | 50,000 | 50,000 | |||||||
Preferred Stock, Convertible Preference Shares, Convertible at Company's Option, Term | 2 years | ||||||||
Preferred Stock, Conversion Basis, Common Stock Class A Closing Trade Price | 125.00% | ||||||||
Preferred Stock, Dividend Rate, Percentage | 7.00% | ||||||||
Additional Paid-in Capital | |||||||||
Share Capital [Line Items] | |||||||||
Issuance of common and convertible preference shares | $ 35,997 | $ 362 | $ 35,997 | ||||||
Common Stock | Common Class A | |||||||||
Share Capital [Line Items] | |||||||||
Stock Issued During Period, Shares, Issued for Services | shares | 14,285,714 | ||||||||
Proceeds from Issuance of Common Stock | $ 50,000 | ||||||||
Shares outstanding (shares) | shares | 71,943,994 | 71,943,994 | 57,517,568 | ||||||
Common stock, voting rights, number of votes per share | vote | 1 | 1 | |||||||
Common Stock | Common Class B | |||||||||
Share Capital [Line Items] | |||||||||
Shares outstanding (shares) | shares | 3,749 | 3,749 | 3,755 | 3,755 | |||||
Common stock, voting rights, number of votes per share | vote | 20 | 20 | |||||||
Contingent Consideration, Liability Settlements [Domain] | Preferred Stock | Series 4 Convertible Preferred Stock | |||||||||
Share Capital [Line Items] | |||||||||
Issuance of common and convertible preference shares | $ 62,623 |
Noncontrolling and Redeemable_3
Noncontrolling and Redeemable Noncontrolling Interests - Changes in Amounts Due to Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Noncontrolling Interest [Abstract] | |||||
Beginning balance | $ 9,278 | $ 11,030 | $ 11,030 | ||
Income attributable to noncontrolling interests | $ 3,043 | $ 2,545 | 3,472 | 3,442 | 11,785 |
Distributions made | (7,957) | $ (8,927) | (13,419) | ||
Other | 25 | (118) | |||
Ending balance | $ 4,818 | $ 4,818 | $ 9,278 |
Noncontrolling and Redeemable_4
Noncontrolling and Redeemable Noncontrolling Interests - Changes in Noncontrolling Interests (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Noncontrolling Interest [Line Items] | |||||
Net loss attributable to MDC Partners Inc. | $ 4,290 | $ 3,406 | $ 3,406 | $ 4,177 | $ (26,010) |
Change from net loss attributable to MDC Partners Inc. and transfers to noncontrolling interests | (4,193) | (3,406) | (4,080) | 27,176 | |
MDC Partners Inc. Shareholders' Deficit | |||||
Noncontrolling Interest [Line Items] | |||||
Net loss attributable to MDC Partners Inc. | $ 3,406 | (26,010) | |||
Decrease in MDC Partners Inc. paid-in capital for purchase of equity interests in excess of redeemable noncontrolling interests and noncontrolling interests | $ 97 | $ 0 | $ 97 | $ 1,166 |
Noncontrolling and Redeemable_5
Noncontrolling and Redeemable Noncontrolling Interests - Changes in Redeemable Noncontrolling Interests (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Noncontrolling Interest [Abstract] | ||
Beginning Balance | $ 51,546 | $ 62,886 |
Redemptions | (9,486) | (11,943) |
Granted | 0 | 0 |
Changes in redemption value | 421 | 1,067 |
Currency translation adjustments | 154 | (464) |
Ending Balance | $ 42,635 | $ 51,546 |
Noncontrolling and Redeemable_6
Noncontrolling and Redeemable Noncontrolling Interests (Details Textual) - USD ($) | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Noncontrolling Interest [Line Items] | ||||
Noncontrolling interest, ownership percentage by Parent (percent) | 100.00% | |||
Redeemable Noncontrolling Interest, Equity, Fair Value | $ 42,635,000 | $ 51,546,000 | $ 62,886,000 | |
Vesting over period [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Fair Value | 19,158,000 | |||
Termination, disability, or death [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Fair Value | 19,926,000 | |||
Acquisition Value in excess of Redemption Value [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Redeemable Noncontrolling Interest, Equity, Fair Value | $ 3,551,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - 6.50% Notes due 2024 - Fair Value, Inputs, Level 1 - Senior Notes - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Liabilities: | ||
Long term debt, Carrying Amount | $ 900,000 | $ 900,000 |
Long term debt, Fair Value | $ 823,500 | $ 834,750 |
Supplemental Information (Detai
Supplemental Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Accrued media | $ 151,143 | $ 151,143 | $ 180,586 | ||
Goodwill | 743,582 | 743,582 | $ 740,955 | ||
Income tax expense (benefit) | 2,088 | $ 1,977 | 2,835 | $ (6,353) | |
Income (loss) before income taxes and equity in earnings of non-consolidated affiliates | $ 9,215 | $ 7,956 | $ 10,195 | $ (28,979) | |
Effective tax rate (percent) | 22.70% | 24.80% |
Segment Information (Details 1)
Segment Information (Details 1) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($)operating_segmentreportable_segment | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
Segment Reporting Information [Line Items] | ||||||
Number of reportable segments | reportable_segment | 4 | |||||
Revenue | $ 362,130 | $ 379,743 | $ 690,921 | $ 706,711 | ||
Segment operating income (loss) | 23,442 | 30,772 | 39,123 | 16,139 | ||
Interest expense and finance charges | (16,413) | (16,859) | (33,174) | (32,942) | ||
Foreign exchange transaction gain (loss) | 2,932 | (6,549) | 8,374 | (13,209) | ||
Other, net | (746) | 592 | (4,128) | 1,033 | ||
Income (loss) before income taxes and equity in earnings of non-consolidated affiliates | 9,215 | 7,956 | 10,195 | (28,979) | ||
Income tax expense (benefit) | 2,088 | 1,977 | 2,835 | (6,353) | ||
Income (loss) before equity in earnings (losses) of non-consolidated affiliates | 7,127 | 5,979 | 7,360 | (22,626) | ||
Equity in earnings (losses) of non-consolidated affiliates | 206 | (28) | 289 | 58 | ||
Net income (loss) | 7,333 | 5,951 | 7,649 | (22,568) | ||
Net income attributable to the noncontrolling interest | (3,043) | (2,545) | (3,472) | (3,442) | $ (11,785) | |
Net income (loss) attributable to MDC Partners Inc. | 4,290 | 3,406 | $ 3,406 | 4,177 | (26,010) | |
Depreciation and amortization | 10,663 | 11,703 | 19,501 | 24,078 | ||
Stock-based compensation | 3,634 | 5,603 | 6,606 | 10,640 | ||
Capital expenditures | 4,317 | 5,890 | $ 7,923 | 9,689 | ||
Global Integrated Agencies | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of operating segments | operating_segment | 4 | |||||
Revenue | 154,368 | 158,163 | $ 284,087 | 287,686 | ||
Segment operating income (loss) | 20,720 | 18,352 | 24,491 | 4,760 | ||
Depreciation and amortization | 4,437 | 4,743 | 8,502 | 12,152 | ||
Stock-based compensation | 1,232 | 2,475 | 4,999 | 4,935 | ||
Capital expenditures | 1,816 | 2,411 | $ 3,234 | 4,654 | ||
Domestic Creative Agencies | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of operating segments | operating_segment | 7 | |||||
Revenue | 65,193 | 72,971 | $ 132,201 | 139,625 | ||
Segment operating income (loss) | 8,730 | 5,077 | 14,207 | 7,955 | ||
Depreciation and amortization | 1,547 | 1,281 | 2,786 | 2,574 | ||
Stock-based compensation | 522 | 1,097 | 986 | 1,507 | ||
Capital expenditures | 369 | 569 | $ 1,063 | 1,473 | ||
Specialized Communications | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of operating segments | operating_segment | 4 | |||||
Revenue | 47,170 | 40,304 | $ 86,123 | 79,128 | ||
Segment operating income (loss) | 6,683 | 6,216 | 13,760 | 9,944 | ||
Depreciation and amortization | 698 | 992 | 1,265 | 1,959 | ||
Stock-based compensation | 52 | 52 | 78 | 239 | ||
Capital expenditures | 231 | 2,208 | 482 | 2,443 | ||
Media Services | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue | 21,331 | 21,398 | 41,510 | 46,082 | ||
Segment operating income (loss) | 991 | (1,719) | (843) | (1,738) | ||
Depreciation and amortization | 794 | 635 | 1,485 | 1,273 | ||
Stock-based compensation | (16) | 74 | (16) | 149 | ||
Capital expenditures | 126 | 131 | 167 | 315 | ||
All Other | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue | 74,068 | 86,907 | 147,000 | 154,190 | ||
Segment operating income (loss) | 2,949 | 15,986 | 8,962 | 22,430 | ||
Depreciation and amortization | 2,966 | 3,892 | 5,025 | 5,736 | ||
Stock-based compensation | 652 | 684 | 940 | 1,341 | ||
Capital expenditures | 1,757 | 547 | 2,958 | 772 | ||
Corporate, Non-Segment | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue | 0 | 0 | 0 | 0 | ||
Segment operating income (loss) | (16,631) | (13,140) | (21,454) | (27,212) | ||
Depreciation and amortization | 221 | 160 | 438 | 384 | ||
Stock-based compensation | 1,192 | 1,221 | (381) | 2,469 | ||
Capital expenditures | $ 18 | $ 24 | $ 19 | $ 32 |
Commitments, Contingencies an_2
Commitments, Contingencies and Guarantees (Details Textual) $ in Thousands | Jun. 30, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Amount of letters of credit outstanding | $ 4,744 |
New Accounting Pronouncements (
New Accounting Pronouncements (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Jan. 01, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Lease liability | $ 279,503 | |
Operating lease right-of-use asset | $ 237,418 | |
Accounting Standards Update 2016-02 - ASC 842 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Lease liability | $ 299,243 | |
Operating lease right-of-use asset | $ 254,245 |
Uncategorized Items - mdca-2019
Label | Element | Value |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | $ (1,687,000) |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | (2,062,000) |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | (3,190,000) |
Stock Issued During Period, Value, Restricted Stock Award, Net of Forfeitures | us-gaap_StockIssuedDuringPeriodValueRestrictedStockAwardNetOfForfeitures | 0 |
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 493,000 |
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 22,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 2,107,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 4,324,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 1,800,000 |
Parent [Member] | ||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | us-gaap_NewAccountingPronouncementOrChangeInAccountingPrincipleEffectOfAdoptionQuantification | 0 |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | (1,687,000) |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | (2,062,000) |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | (3,190,000) |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | (943,000) |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | 2,435,000 |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | (1,423,000) |
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | us-gaap_MinorityInterestDecreaseFromRedemptions | 0 |
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | us-gaap_MinorityInterestDecreaseFromRedemptions | 1,166,000 |
Stock Issued During Period, Value, New Issues | us-gaap_StockIssuedDuringPeriodValueNewIssues | 991,000 |
Stock Issued During Period, Value, Convertible Preferred Shares | mdca_StockIssuedDuringPeriodValueConvertiblePreferredShares | (97,000) |
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 493,000 |
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 22,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 2,107,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 4,324,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 1,800,000 |
Retained Earnings [Member] | ||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | us-gaap_NewAccountingPronouncementOrChangeInAccountingPrincipleEffectOfAdoptionQuantification | $ (1,170,000) |
Common Stock [Member] | ||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | us-gaap_StockIssuedDuringPeriodSharesRestrictedStockAwardNetOfForfeitures | 12,585 |
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | us-gaap_StockIssuedDuringPeriodSharesRestrictedStockAwardNetOfForfeitures | 122,029 |
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | us-gaap_StockIssuedDuringPeriodSharesRestrictedStockAwardNetOfForfeitures | 76,979 |
Stock Repurchased and Retired During Period, Shares | us-gaap_StockRepurchasedAndRetiredDuringPeriodShares | 6,185 |
Stock Repurchased and Retired During Period, Shares | us-gaap_StockRepurchasedAndRetiredDuringPeriodShares | 54,693 |
Stock Repurchased and Retired During Period, Shares | us-gaap_StockRepurchasedAndRetiredDuringPeriodShares | 19,257 |
Stock Issued During Period, Shares, New Issues | us-gaap_StockIssuedDuringPeriodSharesNewIssues | 0 |
Additional Paid-in Capital [Member] | ||
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | $ (1,687,000) |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | (2,062,000) |
Increase (Decrease) in Redemption Value of Redeemable Noncontrolling Interests | mdca_IncreaseDecreaseinRedemptionValueofRedeemableNoncontrollingInterests | (3,190,000) |
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | us-gaap_MinorityInterestDecreaseFromRedemptions | 0 |
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests | us-gaap_MinorityInterestDecreaseFromRedemptions | 1,166,000 |
Adjustments to Additional Paid in Capital, Changes due to Business Combinations | mdca_AdjustmentstoAdditionalPaidinCapitalChangesduetoBusinessCombinations | 97,000 |
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 493,000 |
Stock Repurchased and Retired During Period, Value | us-gaap_StockRepurchasedAndRetiredDuringPeriodValue | 22,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 2,107,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 4,324,000 |
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | us-gaap_AdjustmentsToAdditionalPaidInCapitalSharebasedCompensationRequisiteServicePeriodRecognitionValue | 1,800,000 |
AOCI Including Portion Attributable to Noncontrolling Interest [Member] | ||
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | (944,000) |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | 2,435,000 |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | (1,423,000) |
Noncontrolling Interest [Member] | ||
Noncontrolling Interest, Change in Redemption Value | us-gaap_MinorityInterestChangeInRedemptionValue | (5,965,000) |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | (905,000) |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | (2,006,000) |
Other Comprehensive Income (Loss), Net of Tax | us-gaap_OtherComprehensiveIncomeLossNetOfTax | 38,000 |
Adjustments to Additional Paid in Capital, Changes due to Business Combinations | mdca_AdjustmentstoAdditionalPaidinCapitalChangesduetoBusinessCombinations | 27,357,000 |
Adjustments to Additional Paid in Capital, Changes due to Business Combinations | mdca_AdjustmentstoAdditionalPaidinCapitalChangesduetoBusinessCombinations | 27,357,000 |
Adjustments to Additional Paid in Capital, Changes due to Business Combinations | mdca_AdjustmentstoAdditionalPaidinCapitalChangesduetoBusinessCombinations | $ 0 |
Preferred Stock [Member] | ||
Stock Issued During Period, Shares, New Issues | us-gaap_StockIssuedDuringPeriodSharesNewIssues | 0 |
Contingent Consideration, Liability Settlements [Domain] | ||
Stock Issued During Period, Value, Acquisitions | us-gaap_StockIssuedDuringPeriodValueAcquisitions | $ 7,030,000 |
Stock Issued During Period, Value, Acquisitions | us-gaap_StockIssuedDuringPeriodValueAcquisitions | 7,030,000 |
Contingent Consideration, Liability Settlements [Domain] | Parent [Member] | ||
Stock Issued During Period, Value, Acquisitions | us-gaap_StockIssuedDuringPeriodValueAcquisitions | 7,030,000 |
Stock Issued During Period, Value, Acquisitions | us-gaap_StockIssuedDuringPeriodValueAcquisitions | $ 7,030,000 |