VERITIV CORP, 10-Q filed on 11/7/2017
Quarterly Report
Document and Entity Information
9 Months Ended
Sep. 30, 2017
Nov. 2, 2017
Document and Entity Information [Abstract]
 
 
Entity Registrant Name
VERITIV CORPORATION 
 
Entity Central Index Key
0001599489 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Accelerated Filer 
 
Document Type
10-Q 
 
Document Period End Date
Sep. 30, 2017 
 
Document Fiscal Year Focus
2017 
 
Document Fiscal Period Focus (Q1,Q2,Q3,FY)
Q3 
 
Amendment Flag
false 
 
Entity Common Stock, Shares Outstanding
 
15,700,204 
Condensed Consolidated Statements of Operations (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Income Statement [Abstract]
 
 
 
 
Net sales (including sales to related party of $8.6, $8.5, $24.9 and $26.6, respectively)
$ 2,116.8 
$ 2,126.6 
$ 6,140.3 
$ 6,207.2 
Cost of products sold (including purchases from related party of $45.7, $71.4, $138.0 and $174.3, respectively) (exclusive of depreciation and amortization shown separately below)
1,736.6 
1,743.8 
5,026.4 
5,086.2 
Distribution expenses
132.0 
126.0 
380.9 
375.2 
Selling and administrative expenses
228.7 
207.3 
650.4 
615.9 
Depreciation and amortization
13.1 
13.4 
39.9 
40.5 
Acquisition and integration expenses
14.2 
7.3 
28.1 
19.6 
Restructuring charges
2.7 
5.8 
30.0 
7.2 
Operating income (loss)
(10.5)
23.0 
(15.4)
62.6 
Interest expense, net
8.3 
8.2 
22.1 
21.1 
Other expense, net
(0.5)
1.2 
1.2 
6.3 
Income (loss) before income taxes
(18.3)
13.6 
(38.7)
35.2 
Income tax expense (benefit)
(4.0)
8.0 
(13.1)
18.4 
Net income (loss)
$ (14.3)
$ 5.6 
$ (25.6)
$ 16.8 
Earnings (loss) per share:
 
 
 
 
Earnings (loss) per share - basic (in dollars per share)
$ (0.91)
$ 0.35 
$ (1.63)
$ 1.05 
Earnings (loss) per share - diluted ( in dollars per share)
$ (0.91)
$ 0.34 
$ (1.63)
$ 1.04 
Weighted average shares outstanding:
 
 
 
 
Weighted average number of shares outstanding – basic (in shares)
15.70 
16.00 
15.70 
16.00 
Weighted average number of shares outstanding – diluted (in shares)
15.70 
16.27 
15.70 
16.05 
Condensed Consolidated Statements of Operations (Parenthetical) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Income Statement [Abstract]
 
 
 
 
Related party sales
$ 8.6 
$ 8.5 
$ 24.9 
$ 26.6 
Related party cost of products sold
$ 45.7 
$ 71.4 
$ 138.0 
$ 174.3 
Condensed Consolidated Statements of Comprehensive Income (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Statement of Comprehensive Income [Abstract]
 
 
 
 
Net income (loss)
$ (14.3)
$ 5.6 
$ (25.6)
$ 16.8 
Other comprehensive income (loss):
 
 
 
 
Foreign currency translation adjustments
2.4 
(1.6)
7.8 
0.6 
Change in fair value of cash flow hedge, net of $0.1, $0.0, $0.1 and $0.2 tax, respectively
0.1 
(0.3)
Pension liability adjustments, net of $0.0, $0.0, $0.0 and $0.1 tax, respectively
0.1 
0.2 
Other comprehensive income (loss)
2.5 
(1.6)
7.9 
0.5 
Total comprehensive income (loss)
$ (11.8)
$ 4.0 
$ (17.7)
$ 17.3 
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Statement of Comprehensive Income [Abstract]
 
 
 
 
Change in fair value of cash flow hedge, tax
$ 0.1 
$ 0 
$ 0.1 
$ 0.2 
Pension liability adjustments, tax
$ 0 
$ 0 
$ 0 
$ 0.1 
Condensed Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Current assets:
 
 
Cash
$ 76.5 
$ 69.6 
Accounts receivable, less allowances of $45.2 and $34.5, respectively
1,165.1 
1,048.3 
Related party receivable
3.8 
3.9 
Inventories
772.6 
707.9 
Other current assets
134.7 
118.9 
Total current assets
2,152.7 
1,948.6 
Property and equipment (net of depreciation and amortization of $317.9 and $292.8, respectively)
341.5 
371.8 
Goodwill
105.3 
50.2 
Other intangibles, net
68.3 
21.0 
Deferred income tax assets
76.3 
61.8 
Other non-current assets
31.0 
30.3 
Total assets
2,775.1 
2,483.7 
Current liabilities:
 
 
Accounts payable
696.3 
654.1 
Related party payable
11.2 
9.0 
Accrued payroll and benefits
61.5 
84.4 
Other accrued liabilities
130.1 
102.5 
Current maturities of long-term debt
1.8 
2.9 
Financing obligations, current portion (including obligations to related party of $10.4 and $14.9, respectively)
11.1 
14.9 
Total current liabilities
912.0 
867.8 
Long-term debt, net of current maturities
972.0 
749.2 
Financing obligations, less current portion (including obligations to related party of $155.2 and $176.1, respectively)
181.9 
176.1 
Defined benefit pension obligations
25.3 
27.6 
Other non-current liabilities
148.2 
121.2 
Total liabilities
2,239.4 
1,941.9 
Commitments and contingencies (Note 12)
   
   
Shareholders' equity:
 
 
Preferred stock, $0.01 par value, 10.0 million shares authorized, none issued
Common stock, $0.01 par value, 100.0 million shares authorized, 16.0 million shares issued; shares outstanding - 15.7 million at September 30, 2017 and December 31, 2016 respectively
0.2 
0.2 
Additional paid-in capital
586.1 
574.5 
Accumulated earnings (deficit)
(5.9)
19.7 
Accumulated other comprehensive loss
(31.1)
(39.0)
Treasury stock at cost - 0.3 million shares at September 30, 2017 and December 31, 2016
(13.6)
(13.6)
Total shareholders' equity
535.7 
541.8 
Total liabilities and shareholders' equity
$ 2,775.1 
$ 2,483.7 
Condensed Consolidated Balance Sheets (Parenthetical) (USD $)
In Millions, except Share data, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Assets
 
 
Allowance for doubtful accounts
$ 45.2 
$ 34.5 
Depreciation and amortization
317.9 
292.8 
Shareholders' equity:
 
 
Preferred stock, par value (in dollars per share)
$ 0.01 
$ 0.01 
Preferred stock, shares authorized (in shares)
10,000,000 
10,000,000 
Preferred stock, shares issued (in shares)
Common stock par value (in dollars per share)
$ 0.01 
$ 0.01 
Common stock, shares authorized (in shares)
100,000,000 
100,000,000 
Common stock, shares issued (in shares)
16,000,000 
16,000,000 
Common stock, shares outstanding (in shares)
15,700,000 
15,700,000 
Treasury stock, at cost (in shares)
300,000 
300,000 
Liabilities
 
 
Obligations to related parties current
10.4 
14.9 
Obligations to related parties noncurrent
$ 155.2 
$ 176.1 
Condensed Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Operating activities
 
 
Net income (loss)
$ (25.6)
$ 16.8 
Depreciation and amortization
39.9 
40.5 
Amortization of deferred financing fees
1.9 
4.9 
Net losses (gains) on dispositions of property and equipment
(4.0)
(2.7)
Long-lived asset impairment charges
8.4 
4.0 
Provision for allowance for doubtful accounts
11.6 
0.4 
Deferred income tax provision (benefit)
(14.3)
8.1 
Stock-based compensation
11.6 
7.2 
Other non-cash items, net
2.5 
4.7 
Changes in operating assets and liabilities
 
 
Accounts receivable and related party receivable
(87.5)
(48.6)
Inventories
(17.9)
19.9 
Other current assets
(6.7)
(8.5)
Accounts payable and related party payable
69.6 
38.5 
Accrued payroll and benefits
(23.4)
(39.9)
Other accrued liabilities
8.9 
3.6 
Other
7.3 
11.0 
Net cash provided by (used for) operating activities
(17.7)
59.9 
Investing activities
 
 
Property and equipment additions
(26.0)
(29.8)
Proceeds from asset sales
23.1 
5.1 
Cash paid for purchase of business, net of cash acquired
(144.8)
Net cash used for investing activities
(147.7)
(24.7)
Financing activities
 
 
Change in book overdrafts
(43.9)
32.9 
Borrowings of long-term debt
3,685.2 
3,394.4 
Repayments of long-term debt
(3,446.5)
(3,439.0)
Payments under equipment capital lease obligations
(2.2)
(2.3)
Payments under financing obligations (including obligations to related party of $11.5 and $14.4, respectively)
(12.9)
(14.4)
Deferred financing fees
(2.0)
Payments under Tax Receivable Agreement
(8.5)
Net cash provided by (used for) financing activities
171.2 
(30.4)
Effect of exchange rate changes on cash
1.1 
Net change in cash
6.9 
4.8 
Cash at beginning of period
69.6 
54.4 
Cash at end of period
76.5 
59.2 
Supplemental cash flow information
 
 
Cash paid for income taxes, net of refunds
3.2 
3.1 
Cash paid for interest
19.4 
15.5 
Non-cash investing and financing activities
 
 
Non-cash additions to property and equipment
8.6 
12.3 
Contingent consideration for purchase of business: Earn-out
$ 30.0 
$ 0 
Condensed Consolidated Statements of Cash Flows Parenthetical (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Statement of Cash Flows [Abstract]
 
 
Repayments of related party obligation
$ 11.5 
$ 14.4 
Business and Summary of Significant Accounting Policies
Business and Summary of Significant Accounting Policies
1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Veritiv Corporation ("Veritiv" or the "Company") is a North American business-to-business distributor of packaging, facility solutions, print and publishing products and services. Additionally, Veritiv provides logistics and supply chain management solutions to its customers. Veritiv was established in 2014, following the merger (the "Merger") of International Paper Company's xpedx distribution solutions business ("xpedx") and UWW Holdings, Inc. ("UWWH"), the parent company of Unisource Worldwide, Inc. ("Unisource").

Veritiv operates from approximately 170 distribution centers primarily throughout the U.S., Canada and Mexico.


Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for a complete set of annual audited financial statements.

The accompanying unaudited financial information should be read in conjunction with the Consolidated and Combined Financial Statements and Notes contained in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2016. In the opinion of management, all adjustments, including normal recurring accruals and other adjustments, considered necessary for a fair presentation of the interim financial information have been included. The operating results for the interim periods are not necessarily indicative of results for the full year.

All significant intercompany transactions between Veritiv's businesses have been eliminated.
    
        
Use of Estimates

The preparation of unaudited financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and certain financial statement disclosures. Estimates and assumptions are used for, but not limited to, revenue recognition, accounts receivable valuation, inventory valuation, employee benefit plans, income tax contingency accruals and valuation allowances, multi-employer pension plan withdrawal liabilities and goodwill and other intangible asset valuations. Although these estimates are based on management's knowledge of current events and actions it may undertake in the future, actual results may ultimately differ from these estimates and assumptions. Estimates are revised as additional information becomes available.

Recently Issued Accounting Standards Not Yet Adopted
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial Statements or Other Significant Matters
Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606)
 
The standard will replace existing revenue recognition standards and significantly expand the disclosure requirements for revenue arrangements. It may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts with remaining performance obligations as of the effective date.
 
January 1, 2018; early adoption date is no earlier than the annual period beginning after December 15, 2016
 
The Company’s analysis of the impact of this standard is ongoing. Focus areas include the impacts of accounting for customer dedicated inventory and principal/agent considerations. During the third quarter, work continued on the disclosure requirements and internal control assessments. As the analysis is not yet complete, the Company cannot provide a financial impact assessment at this time, nor provide a determination as to the effect of the new standard on its internal control over financial reporting and other changes in business practices and processes. The Company anticipates applying the modified retrospective method of adoption. The Company will adopt this ASU on January 1, 2018.

ASU 2016-02, Leases (Topic 842)
 
The standard requires lessees to put most leases on their balance sheet but recognize expenses in their statement of operations in a manner similar to current accounting guidance. The new standard also eliminates the current guidance related to real estate specific provisions. The guidance requires application on a modified retrospective basis to leases that existed at the beginning of the earliest period presented and those entered into thereafter but prior to the effective date. The standard permits entities to elect a package of practical expedients which must be applied consistently to all leases that commenced prior to the effective date. If the package of practical expedients is elected, entities do not need to reassess: (i) whether expired or existing contracts contain leases; (ii) lease classification for any expired or existing leases; and (iii) initial direct costs for any existing leases. The guidance also allows entities to make certain policy elections under the new standard, including: (i) the use of hindsight to determine lease term and when assessing existing right of use assets for impairment; (ii) a policy to not record short-term leases on the balance sheet; and (iii) a policy to not separate lease and non-lease components.

 
January 1, 2019; early adoption is permitted
 
The Company is currently evaluating this standard and anticipates that its adoption will have a material impact on the Consolidated Financial Statements and related disclosures as it will result in recording virtually all operating leases on the balance sheet as a lease obligation and right of use asset. The Company’s preliminary assessment has focused on system readiness and the policy elections and practical expedients permitted by the standard. Lease software has been implemented that will better enable the Company to implement the standard. The Company currently anticipates electing to apply the package of practical expedients to all leases that commenced prior to the date of adoption. Based on the analysis performed to date, the Company anticipates making a policy election to not include short-term leases on the Consolidated Balance Sheets and to separate lease and non-lease components. A decision has not been made regarding the use of hindsight when determining lease term and assessing existing right of use assets for impairment. The assessment is ongoing and the preliminary conclusions are subject to change. At this time the Company is unable to quantify the impact that the adoption of this standard will have on the Consolidated Financial Statements and related disclosures. The Company currently plans to adopt this ASU on January 1, 2019.

 
 
 
 
 
 
 
Recently Issued Accounting Standards Not Yet Adopted (continued)
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial Statements or Other Significant Matters
ASU 2016-13, Financial Instruments-Credit Losses (Topic 326)
 
The standard will replace the currently required incurred loss impairment methodology with guidance that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to be considered in making credit loss estimates. The guidance requires application on a modified retrospective basis. Other application requirements exist for specific assets impacted by a more-than-insignificant credit deterioration since origination.
 
January 1, 2020; early adoption is permitted for fiscal years beginning after December 15, 2018
 
The Company is currently evaluating the impact this ASU will have on its Consolidated Financial Statements and related disclosures. The Company currently plans to adopt this ASU on January 1, 2020.
ASU 2016-15, Statement of Cash Flows (Topic 230)

 
The standard addresses eight specific cash flow issues and is intended to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The guidance requires application on a retrospective basis.

 
January 1, 2018; early adoption is permitted (early adoption requires the adoption of all amendments in the same period)

 
The Company is currently evaluating the impact this ASU will have on its Consolidated Financial Statements and related disclosures; the impact is not expected to be material. The Company will adopt this ASU on January 1, 2018.
ASU 2017-01, Business Combinations (Topic 805)
 
The standard clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The guidance requires application on a prospective basis.
 
January 1, 2018; early adoption is permitted
 
The Company will adopt this ASU on January 1, 2018.
ASU 2017-07, Compensation-Retirement Benefits (Topic 715)
 
The standard requires employers to disaggregate the service cost component from the other components of net benefit cost and disclose the amount of net benefit cost that is included in the income statement or capitalized in assets, by line item. The standard requires employers to report the service cost component in the same line item(s) as other compensation costs and to report other pension-related costs (which include interest costs, amortization of pension-related costs from prior periods and the gains or losses on plan assets) separately and exclude them from the subtotal of operating income. The standard also allows only the service cost component to be eligible for capitalization when applicable. The guidance requires application on a retrospective basis for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and on a prospective basis for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets.
 
January 1, 2018; early adoption is permitted as of the first interim period of an annual period for which interim or annual financial statements have not been issued
 
The Company is currently making its assessment of the impact that this ASU will have on its Consolidated Financial Statements and related disclosures using results from 2016 and year-to-date 2017; the impact is not expected to be material. The Company will adopt this ASU on January 1, 2018.


Recently Adopted Accounting Standards
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial Statements or Other Significant Matters
ASU 2015-11, Inventory - Simplifying the Measurement of Inventory (Topic 330)
 
The standard requires companies to measure inventory at the lower of cost and net realizable value, thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market. This ASU does not apply to inventories measured by either the last-in first-out ("LIFO") method or retail inventory method. The guidance requires application on a prospective basis.
 
January 1, 2017
 
The Company adopted this ASU on January 1, 2017. The adoption did not materially impact its Consolidated Financial Statements or related disclosures. As of September 30, 2017, approximately 87% of the inventory balance was measured using LIFO.
ASU 2017-04, Intangibles - Goodwill and Other (Topic 350)
 
The standard simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The guidance requires application on a prospective basis.
 
January 1, 2020; early adoption is permitted
 
The Company adopted this ASU on January 1, 2017.
ASU 2017-09, Compensation - Stock Compensation (Topic 718)
 
The standard clarifies the changes to the terms and conditions of a share-based payment award that require an entity to apply modification accounting. The guidance requires application on a prospective basis.
 
January 1, 2018; early adoption is permitted
 
The Company adopted this ASU on April 1, 2017. The adoption did not materially impact its Consolidated Financial Statements or related disclosures.
2017 Acquisition
2017 Acquisition
2. 2017 ACQUISITION

Acquisition of All American Containers - August 2017

On August 31, 2017 (the "Acquisition Date"), Veritiv completed its acquisition of 100% of the equity interest in various All American Containers entities (collectively, "AAC"), a family owned and operated distributor of rigid packaging, including plastic, glass and metal containers, caps, closures and plastic pouches. The acquisition of AAC aligns with the Company's strategy of investing in higher growth and higher margin segments of the business. Through the acquisition, Veritiv gains expertise in rigid plastic, glass and metal packaging that complements its portfolio of packaging products and services. This acquisition also provides Veritiv with additional marketing, selling and distribution channels into the growing U.S. rigid packaging market. The rigid packaging market's primary product categories include paperboard, plastics, metals and glass.
    
Acquisition-related costs of approximately $6.3 million were expensed as incurred. These costs were recognized in acquisition and integration expenses on the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2017. These charges are included in the table in Note 3, Acquisition, Integration and Restructuring Charges and related primarily to legal, consulting and other professional fees, and retention.

The acquisition of AAC was accounted for in the Company's financial statements using the acquisition method of accounting. The total consideration to complete the acquisition was approximately $176.6 million. Due to the limited amount of time since the acquisition of AAC, the valuation of certain assets and liabilities is preliminary and, as management receives additional information during the measurement period, these assets and liabilities may be adjusted. The preliminary purchase price was allocated to tangible and intangible assets and liabilities based upon their respective estimated fair values. The following table summarizes the components of the preliminary estimated purchase price for AAC:

Preliminary estimated purchase price:
 
(in millions)
Cash consideration
$
112.0

Repayment of loans
34.3

Contingent consideration: Earn-out
30.0

Contingent bonus tax payment
0.3

Total preliminary estimated purchase price
$
176.6



The following table summarizes the allocation of the preliminary estimated purchase price to assets acquired and liabilities assumed as of the Acquisition Date based on valuation information, estimates and assumptions available on September 30, 2017. See Note 4, Goodwill and Other Intangible Assets, for additional information related to the goodwill and intangible assets acquired in the AAC acquisition. See Note 9, Fair Value Measurements, for additional information related to the fair value of the contingent consideration related to the earn-out.    
    
Preliminary allocation:
 
(in millions)
Cash
$
1.5

Accounts receivable
30.4

Inventories
39.2

Other current assets
5.7

Property and equipment
2.2

Goodwill
61.2

Other intangible assets
51.2

Other non-current assets
0.9

Accounts payable
(12.4
)
Other current liabilities
(2.7
)
Other non-current liabilities
(0.6
)
Total preliminary estimated purchase price
$
176.6



The amounts shown above may change as the purchase price will be based upon finalization of customary working capital adjustments and valuation of the contingent liability associated with the earn-out. The Company is still in the process of verifying data and finalizing information related to the valuation and expects to finalize these matters within the measurement period as final asset and liability valuations are completed.

Actual and Pro Forma Impact (unaudited)

The operating results of AAC are included in the Company's financial statements from September 1, 2017 through September 30, 2017. Net sales and pre-tax loss attributable to AAC during this period and included in the Company's Condensed Consolidated Statements of Operations were $16.0 million and ($0.9) million, respectively.

The following unaudited pro forma financial information presents results as if the acquisition of AAC occurred on January 1, 2016. The historical consolidated financial information of the Company and AAC has been adjusted in the pro forma information to give effect to pro forma events that are directly attributable to the transaction and are factually supportable. The unaudited pro forma results do not reflect events that have occurred or may occur after the transaction, including the impact of any synergies expected to result from the acquisition. Accordingly, the unaudited pro forma financial information is not necessarily indicative of the results of operations as they would have been had the transaction been effected on the assumed date, nor is it necessarily an indication of future operating results.

(Unaudited)
Three Months Ended September 30,
 
Nine Months Ended September 30,
(in millions, except share and per share data)
2017
 
2016
 
2017
 
2016
Net sales
$
2,157.8

 
$
2,181.9

 
$
6,303.2

 
$
6,378.3

Net income (loss)
(11.3
)
 
5.4

 
(21.5
)
 
12.0

Earnings (loss) per share:
 
 
 
 
 
 
 
Basic earnings (loss) per share
$
(0.72
)
 
$
0.34

 
$
(1.37
)
 
$
0.75

Diluted earnings (loss) per share
$
(0.72
)
 
$
0.33

 
$
(1.37
)
 
$
0.75

Weighted-average shares outstanding
 
 
 
 
 
 
 
Basic
15.70

 
16.00

 
15.70

 
16.00

Diluted
15.70

 
16.27

 
15.70

 
16.05



The unaudited pro forma information reflects primarily the following pre-tax adjustments for the respective periods:
- Acquisition and integration expenses: Acquisition and integration expenses of $6.9 million and $7.4 million incurred during the three and nine months ended September 30, 2017, respectively, have been eliminated. Pro forma net income for the three and nine months ended September 30, 2016 includes acquisition and integration expenses of $0.0 million and $7.4 million, respectively.
- Incremental amortization expense: Pro forma net income for the three and nine months ended September 30, 2017 includes incremental amortization expense of $1.1 million and $4.4 million, respectively. Pro forma net income for the three and nine months ended September 30, 2016 includes incremental amortization expense of $1.7 million and $5.0 million, respectively.
- Interest expense: Pro forma net income for the three and nine months ended September 30, 2017 includes incremental interest expense of $0.5 million and $2.0 million, respectively. Pro forma net income for the three and nine months ended September 30, 2016 includes incremental interest expense of $0.6 million and $1.8 million, respectively.

A combined U.S. federal statutory and state rate of 39.0% was used to determine the after-tax impact on net income of the pro forma adjustments.
Acquisition Integration and Restructuring Charges
Acquisition Integration and Restructuring Charges
3. ACQUISITION, INTEGRATION AND RESTRUCTURING CHARGES

Merger of xpedx and Unisource

The Company currently expects net costs and charges associated with achieving anticipated cost savings and other synergies from the Merger (excluding charges relating to the complete or partial withdrawal from multi-employer pension plans ("MEPP"), some of which are uncertain at this time, and including cash proceeds from sales of assets related to consolidation), to be approximately $225 million to $250 million through December 31, 2018. Included in the estimate is approximately $105 million for capital expenditures, primarily consisting of information technology infrastructure, systems integration and planning. Through September 30, 2017, the Company has incurred approximately $233 million in costs and charges, including approximately $78 million for capital expenditures.
    
During the three and nine months ended September 30, 2017 and 2016, Veritiv incurred costs and charges related primarily to: internally dedicated integration management resources, retention compensation, information technology conversion costs, rebranding, professional services and other costs to integrate its businesses.

The following table summarizes the components of acquisition and integration expenses:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
(in millions)
2017
 
2016
 
2017
 
2016
Integration management
$
3.8

 
$
2.2

 
$
10.5

 
$
6.0

Retention compensation

 
0.4

 
0.2

 
2.4

Information technology conversion costs
2.8

 
1.9

 
6.8

 
4.3

Rebranding
0.1

 
0.9

 
0.4

 
2.1

Legal, consulting and other professional fees
0.4

 
0.8

 
1.3

 
1.8

Other
0.6

 
1.1

 
2.4

 
3.0

AAC acquisition and integration
6.5

 

 
6.5

 

Total acquisition and integration expenses
$
14.2

 
$
7.3

 
$
28.1

 
$
19.6




Veritiv Restructuring Plan
As part of the Merger, the Company is executing on a multi-year restructuring program of its North American operations intended to integrate the legacy xpedx and Unisource operations, generate cost savings and capture synergies across the combined company. The restructuring plan includes initiatives to: (i) consolidate warehouse facilities in overlapping markets, (ii) improve efficiency of the delivery network, (iii) consolidate customer service centers, (iv) reorganize the field sales and operations functions and (v) restructure the corporate general and administrative functions. As part of its restructuring efforts, the Company continues to evaluate its operations outside of North America to identify additional cost saving opportunities. The Company may elect to restructure its operations in specific countries, which may include staff reductions, lease terminations and facility closures or the complete exit of a market. The Company may continue to record restructuring charges in the future as restructuring activities progress, which may include gains or losses from the disposition of assets. As of September 30, 2017, the Company held for sale $4.2 million in assets related to these activities, which are included in other current assets on the Condensed Consolidated Balance Sheets.

Related to these company-wide initiatives, the Company recorded restructuring charges of $2.7 million and $5.8 million for the three months ended September 30, 2017 and 2016, respectively, and restructuring charges of $30.0 million and $7.2 million for the nine months ended September 30, 2017 and 2016, respectively. The increase in charges for the nine months ended September 30, 2017 over the same period in 2016 primarily related to: (i) an estimated $15.5 million in MEPP withdrawals, (ii) $4.1 million in severance costs and (iii) other facility relocation and related support costs. See Note 13, Segment Information, for the impact these charges had on the Company's reportable segments. Other direct costs reported in the tables below include facility closing costs and other incidental costs associated with the development, communication, administration and implementation of these initiatives.

The following is a summary of the Company's restructuring activity for the three and nine months ended September 30, 2017:
(in millions)
Severance and Related Costs
 
Other Direct Costs
 
Total
Balance at December 31, 2016
$
1.8

 
$
8.0

 
$
9.8

Costs incurred
1.4

 
3.1

 
4.5

Payments
(1.2
)
 
(2.8
)
 
(4.0
)
Balance at March 31, 2017
2.0

 
8.3

 
10.3

Costs incurred
3.9

 
19.7

 
23.6

Payments
(2.0
)
 
(5.4
)
 
(7.4
)
Balance at June 30, 2017
3.9

 
22.6

 
26.5

Costs incurred
0.7

 
3.8

 
4.5

Payments
(0.7
)
 
(4.7
)
 
(5.4
)
Balance at September 30, 2017
$
3.9

 
$
21.7

 
$
25.6



In addition, the Company recognized net non-cash gains of $1.8 million and $2.6 million related to vacating certain of its facilities for the three and nine months ended September 30, 2017, respectively.

The following is a summary of the Company's restructuring activity for the three and nine months ended September 30, 2016:
(in millions)
Severance and Related Costs
 
Other Direct Costs
 
Total
Balance at December 31, 2015
$
1.7

 
$
0.4

 
$
2.1

Costs incurred
0.7

 
0.3

 
1.0

Payments
(0.9
)
 
(0.4
)
 
(1.3
)
Balance at March 31, 2016
1.5

 
0.3

 
1.8

Costs incurred
0.9

 
1.5

 
2.4

Payments
(0.6
)
 
(1.0
)
 
(1.6
)
Balance at June 30, 2016
1.8

 
0.8

 
2.6

Costs incurred
0.3

 
5.4

 
5.7

Payments
(1.0
)
 
(0.7
)
 
(1.7
)
Balance at September 30, 2016
$
1.1

 
$
5.5

 
$
6.6



In addition, the Company recognized a net non-cash loss of $0.1 million and a net non-cash gain of $1.9 million related to vacating certain of its facilities for the three and nine months ended September 30, 2016, respectively.
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets
4. GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill
        
At September 30, 2017, the Company's net goodwill balance was $105.3 million. The following table sets forth the changes in the carrying amount of goodwill during the three and nine months ended September 30, 2017:

(in millions)
Packaging
 
Corporate & Other
 
Total
Balance at December 31, 2016:
 
 
 
 
 
   Goodwill
$
44.1

 
$
6.1

 
$
50.2

   Accumulated impairment losses

 

 

      Net goodwill 2016
44.1

 
6.1

 
50.2

2017 Activity:
 
 
 
 
 
   Goodwill acquired
61.2

 

 
61.2

   Impairment of goodwill

 
(6.1
)
 
(6.1
)
Balance at September 30, 2017:


 

 

   Goodwill
105.3

 
6.1

 
111.4

   Accumulated impairment losses

 
(6.1
)
 
(6.1
)
      Net goodwill at September 30, 2017
$
105.3

 
$

 
$
105.3



Preliminary goodwill of $61.2 million arising from the acquisition of AAC, as described in Note 2, 2017 Acquisition, consists largely of the expected synergies and other benefits from combining operations and is expected to be deductible for tax purposes. The goodwill was allocated 100% to the Company's Packaging segment.

During the third quarter of 2017, as part of the Company's review for possible goodwill impairment indicators, management determined that the goodwill allocated to the logistics solutions business was fully impaired. The impairment was recorded as selling and administrative expense in the Condensed Consolidated Statements of Operations. See Note 9, Fair Value Measurements, for additional information related to the impairment. As the asset had no remaining net book value or useful life, both the gross value and accumulated amortization value were removed from the Company’s ledger.
    
Other Intangible Assets

The components of the Company's other intangible assets were as follows:
 
September 30, 2017
 
December 31, 2016
(in millions)
Gross Carrying Amount
 
Accumulated Amortization
 
Net
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net
Customer relationships
$
64.9

 
$
5.0

 
$
59.9

 
$
23.6

 
$
4.0

 
$
19.6

Trademarks/Trade names
7.8

 
1.9

 
5.9

 
2.7

 
1.3

 
1.4

Non-compete agreements
2.6

 
0.1

 
2.5

 

 

 

     Total
$
75.3

 
$
7.0

 
$
68.3

 
$
26.3

 
$
5.3

 
$
21.0


    
The gross carrying amount of other intangible assets increased by $51.2 million as a result of the acquisition of AAC. Due to the limited amount of time since the acquisition of AAC, the valuation of the identifiable intangible assets is preliminary and based on market benchmark studies. These assets are included in other intangibles, net on the Condensed Consolidated Balance Sheets and are being amortized to operating expense on a straight-line basis over their estimated useful lives. Preliminary allocated values from the AAC acquisition are as follows:
 
Gross Value (in millions)
 
Estimated Useful Life (in years)
Customer relationships
$
43.5

 
10
Trademarks/Trade names
5.1

 
5
Non-compete agreements
2.6

 
2
Total identifiable intangible assets acquired
$
51.2

 
 


During the third quarter of 2017, the Company recognized a $1.6 million non-restructuring asset impairment charge related to its logistics solutions business's customer relationship intangible asset, which was recorded in selling and administrative expenses. See Note 9, Fair Value Measurements, for additional information related to the impairment.
Debt And Other Obligations
Debt And Other Obligations
5. DEBT AND OTHER OBLIGATIONS

The Company's long-term debt obligations were as follows:
(in millions)
September 30, 2017
 
December 31, 2016
Asset-Based Lending Facility (the "ABL Facility")
$
969.3

 
$
726.9

Equipment capital lease and other obligations
4.5

 
25.2

Total debt
973.8

 
752.1

Less: current maturities of long-term debt
(1.8
)
 
(2.9
)
Long-term debt, net of current maturities
$
972.0

 
$
749.2



Availability under the ABL Facility is determined based upon a monthly borrowing base calculation which includes eligible customer receivables and inventory, less outstanding borrowings, letters of credit and certain designated reserves. As of September 30, 2017, the available additional borrowing capacity under the ABL Facility was approximately $272.3 million.

The equipment capital lease and other obligations reported in the table above includes $19.1 million related to the accumulated construction costs for the Toronto build-to-suit arrangement as of December 31, 2016. This project was completed during the second quarter of 2017 and is accounted for as a financing obligation. As such, for periods beginning with the second quarter of 2017 the obligation value is shown in the table below as other financing, in addition to the Company's related party financing obligations.         

The Company's long-term financing obligations were as follows:
(in millions)
September 30, 2017
 
December 31, 2016
Obligations to related party
$
165.6

 
$
191.0

Obligations - other financing
27.4

 

Total financing obligations
193.0

 
191.0

Less: current portion of financing obligations
(11.1
)
 
(14.9
)
Financing obligations, less current portion
$
181.9

 
$
176.1



From the Merger through September 30, 2017, the Company has terminated agreements for 11 of the related party financed properties and therefore triggered an early termination of each respective property's financing agreement. One of these terminations also involved the purchase of a facility in Austin, Texas. See Note 7, Related Party Transactions, for additional information related to that purchase. Upon termination of a property's financing agreement, the Company recognizes the non-cash effects of the derecognition of (i) the property and equipment and (ii) the corresponding financing obligation, as other non-cash items, net, on the Condensed Consolidated Statements of Cash Flows. Any gain or loss realized upon derecognition has been included in other expense, net or restructuring charges on the Condensed Consolidated Statements of Operations, based upon the rationale for the termination. For the three and nine months ended September 30, 2017, the non-cash effects related to the derecognition of (i) the property and equipment totaled $5.3 million and $14.6 million, respectively, and (ii) the corresponding financing obligations totaled $5.6 million and $15.2 million respectively. For the nine months ended September 30, 2016, there was one termination related to these financed properties, which was the Austin, Texas facility purchase noted above. Unless terminated early, upon the expiration of the term of the remaining related party financing agreements, the net remaining financing obligation of $155.2 million will be settled by the return of the assets to the owner and has been included in other non-current liabilities on the Condensed Consolidated Balance Sheets.

In May 2017, the Company entered into a purchase and sale agreement under which Veritiv agreed to sell the previously acquired Austin, Texas facility to an unrelated third party. Upon the closing of the sale, Veritiv entered into a lease of the facility for an initial period of ten years with two optional five-year renewal terms. The sale-leaseback transaction does not provide for any continuing involvement by the Company other than a normal lease for use of the property during the lease term. The transaction resulted in net cash proceeds of $9.1 million and a related deferred gain of $5.4 million. The Company expects to recognize the gain over the initial ten-year lease period on a straight-line basis as a reduction to selling and administrative expenses in the Condensed Consolidated Statements of Operations. The current portion of the deferred gain is included in other accrued liabilities and the non-current portion of the deferred gain is included in other non-current liabilities on the Condensed Consolidated Balance Sheets.
Income Taxes
Income Taxes
6. INCOME TAXES

The Company’s provision (benefit) for income taxes for the three and nine months ended September 30, 2017 and 2016 is based on the estimated annual effective tax rate, plus any discrete items.

The following table presents the provision for income taxes and the effective tax rates for the three and nine months ended September 30, 2017 and 2016:
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
(in millions)
2017
 
2016
 
2017
 
2016
Income (loss) before income taxes
$
(18.3
)
 
$
13.6

 
$
(38.7
)
 
$
35.2

Income tax expense (benefit)
(4.0
)
 
8.0

 
(13.1
)
 
18.4

Effective tax rate
21.9
%
 
58.8
%
 
33.9
%
 
52.3
%


The difference between the Company’s effective tax rates for the three and nine months ended September 30, 2017 and 2016 and the U.S. statutory tax rate of 35.0% primarily relates to non-deductible expenses, state income taxes (net of federal income tax benefit), and the Company's income (loss) by jurisdiction. Additionally, the effective tax rates for the three and nine months ended September 30, 2017 include the benefit of tax credits and the impact of impairing non-deductible goodwill.

In conjunction with the third quarter of 2017 filing of Veritiv's 2016 U.S. federal tax return and amended 2015 and 2014 U.S. federal tax returns, the Company recognized a $3.1 million benefit for credits related to foreign taxes and research and experimentation activities. Additionally, an estimate of 2017 tax credits is included in our estimated annual effective tax rate.

The effective tax rate may vary significantly due to potential fluctuations in the amount and source, including both foreign and domestic, of pre-tax income and changes in amounts of non-deductible expenses and other items.
Related Party Transactions
Related Party Transactions
7. RELATED PARTY TRANSACTIONS

Agreements with the UWWH Stockholder

On March 22, 2017, UWW Holdings, LLC (the "UWWH Stockholder"), one of Veritiv's existing stockholders and the former sole stockholder of UWWH, sold 1.80 million shares of Veritiv common stock in a block trade. The Company did not sell any shares and did not receive any of the proceeds. In conjunction with this transaction, Veritiv incurred approximately $0.2 million in transaction-related fees, which are included in selling and administrative expenses on the Condensed Consolidated Statements of Operations. The UWWH Stockholder beneficially owned 27.3% of Veritiv's outstanding common stock as of September 30, 2017, based on publicly available data.

In January 2017, in connection with the Tax Receivable Agreement ("TRA") executed at the time of the Merger, Veritiv paid $8.7 million total, of which $8.5 million was the principal amount, to the UWWH Stockholder for the utilization of pre-merger net operating losses ("NOL" or "NOLs") in its 2015 federal and state tax returns. See Note 9, Fair Value Measurements, for additional information regarding the TRA.

Transactions with Georgia-Pacific

Veritiv purchases certain inventory items from, and sells certain inventory items to, Georgia-Pacific in the normal course of business. As a result of the Merger and related private placement, Georgia-Pacific, as joint owner of the UWWH Stockholder, is a related party.

The following tables summarize the financial impact of these related party transactions with Georgia-Pacific:
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
(in millions)
 
2017
 
2016
 
2017
 
2016
Sales to Georgia-Pacific, reflected in net sales
 
$
8.6

 
$
8.5

 
$
24.9

 
$
26.6

Purchases of inventory from Georgia-Pacific, recognized in cost of products sold
 
45.7

 
71.4

 
138.0

 
174.3


(in millions)
 
September 30, 2017
 
December 31, 2016
Inventories purchased from Georgia-Pacific that remained on Veritiv's balance sheet
 
$
23.5

 
$
24.8

Related party payable to Georgia-Pacific
 
11.2

 
9.0

Related party receivable from Georgia-Pacific
 
3.8

 
3.9


    
Additionally, in April 2016, Veritiv assumed ownership of a warehouse and distribution facility located in Austin, Texas that was subleased from Georgia-Pacific. The Company exercised its right of first refusal and matched a $5.4 million offer from an unrelated third party to purchase the facility directly from the owner. This transaction was accounted for as a settlement of the financing obligation related to the facility. Accordingly, Veritiv recognized a $1.3 million loss on the transaction, which is reflected in other expense, net, on the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2016.
Defined Benefit Plans
Defined Benefit Plans
8. DEFINED BENEFIT PLANS

In conjunction with the Merger, Veritiv assumed responsibility for Unisource’s defined benefit plans and Supplemental Executive Retirement Plans in the U.S. and Canada. Net periodic benefit cost (credit) associated with these plans is summarized below:
    
 
Three Months Ended September 30, 2017
 
Three Months Ended September 30, 2016
(in millions)
U.S.
 
Canada
 
U.S.
 
Canada
Components of net periodic benefit cost (credit):
 
 
 
 
 
 
 
Service cost
$
0.5

 
$
0.0

 
$
0.4

 
$
0.1

Interest cost
0.6

 
0.8

 
0.7

 
0.8

Expected return on plan assets
(1.2
)
 
(1.0
)
 
(1.2
)
 
(0.9
)
Amortization of net loss
0.1

 
0.0

 
0.0

 
0.0

Net periodic benefit cost (credit)
$
0.0

 
$
(0.2
)
 
$
(0.1
)
 
$
0.0


        
 
Nine Months Ended September 30, 2017
 
Nine Months Ended September 30, 2016
(in millions)
U.S.
 
Canada
 
U.S.
 
Canada
Components of net periodic benefit cost (credit):
 
 
 
 
 
 
 
Service cost
$
1.5

 
$
0.2

 
$
1.3

 
$
0.2

Interest cost
2.0

 
2.1

 
2.5

 
2.4

Expected return on plan assets
(3.8
)
 
(2.8
)
 
(3.8
)
 
(2.7
)
Amortization of net loss
0.1

 
0.1

 
0.1

 
0.1

Net periodic benefit cost (credit)
$
(0.2
)
 
$
(0.4
)
 
$
0.1

 
$
0.0

Fair Value Measurements
Fair Value Measurements
9. FAIR VALUE MEASUREMENTS

At September 30, 2017 and December 31, 2016, the carrying amounts of cash, receivables, payables and other components of other current assets and other current liabilities approximate their fair values due to the short maturity of these items.

Certain of the Company's assets and liabilities are also subject to nonrecurring fair value measurements. Generally, assets are recorded at their fair values on a nonrecurring basis as a result of impairment charges. During the Company's review of its intangible assets for possible impairment indicators, management determined that the carrying values of the goodwill and customer relationship intangible assets allocated to the logistics solutions business were fully impaired. The impairments were determined after a review of the business's forecasted revenues and estimated cash flows (Level 3 data). The impairment charges were primarily a result of lower forecasted sales growth, due to expected changes in our growth strategy and margin compression due to increased competition. The fair value of these assets was derived using discounted cash flow analyses based on Level 3 inputs. As a result, the Company recorded $7.7 million in non-restructuring impairment charges for the three months ended September 30, 2017 related to its logistics solutions business's goodwill and customer relationship intangible assets. See Note 4, Goodwill and Other Intangible Assets, for additional information regarding the Company's goodwill and other intangible assets. For the nine months ended September 30, 2017, the Company recognized $8.4 million in non-restructuring impairment charges related to the previously noted goodwill and customer relationship intangible asset impairments, as well as a software asset which will not be placed into service and has no alternative use. For the three and nine months ended September 30, 2016, the Company recognized $3.1 million and $4.0 million, respectively, in non-restructuring impairment charges related to its Publishing segment's customer relationship intangible asset, software assets and the sale of a facility. The impairment charges for 2017 and 2016 were recorded in selling and administrative expenses on the Condensed Consolidated Statements of Operations.

The Company's liabilities disclosed at fair value at September 30, 2017 were as follows:
(in millions)
 
Total

Level 1

Level 2

Level 3
ABL Facility
 
$
969.3



 
$
969.3

 

Tax Receivable Agreement
 
61.0



 

 
61.0

Contingent Consideration: Earn-out
 
30.0

 
 
 
 
 
30.0


The Company's liabilities disclosed at fair value at December 31, 2016 were as follows:
(in millions)
 
Total
 
Level 1
 
Level 2
 
Level 3
ABL Facility
 
$
726.9

 

 
$
726.9

 

Tax Receivable Agreement
 
67.9

 

 

 
67.9



Borrowings under the ABL Facility are at variable market interest rates and, accordingly, the carrying amount approximates fair value.

At the time of the Merger, the Company recorded a $59.4 million contingent liability associated with the TRA at fair value using a discounted cash flow model that reflected management's expectations about probability of payment. The fair value of the TRA is a Level 3 measurement, which relied upon both Level 2 data (publicly observable data such as market interest rates) and Level 3 data (internal data such as the Company’s projected revenues, taxable income and assumptions about the utilization of Unisource’s NOLs, attributable to taxable periods prior to the Merger, by the Company). The amount payable under the TRA is contingent on the Company generating a certain level of taxable income prior to the expiration of the NOL carryforwards. Moreover, future trading of Company stock by significant stockholders may result in additional ownership changes as defined under Section 382 of the Internal Revenue Code, further limiting the use of Unisource's NOLs and the amount ultimately payable under the TRA. The contingent liability is remeasured at fair value at each reporting period end with the change in fair value recognized in other expense, net on the Condensed Consolidated Statements of Operations. At September 30, 2017, the Company remeasured the contingent liability using a discount rate of 4.3% (Moody's daily long-term corporate BAA bond yield).

The following table provides a reconciliation of the beginning and ending balance of the TRA contingent liability for the three and nine months ended September 30, 2017:    
(in millions)
 
TRA Contingent Liability
Balance at December 31, 2016
 
$
67.9

Change in fair value adjustment recorded in other expense, net
 
0.9

Principal payment
 
(8.5
)
Balance at March 31, 2017
 
60.3

Change in fair value adjustment recorded in other expense, net
 
1.1

Balance at June 30, 2017
 
61.4

Change in fair value adjustment recorded in other expense, net
 
(0.4
)
Balance at September 30, 2017
 
$
61.0



The following table provides a reconciliation of the beginning and ending balance of the TRA contingent liability for the three and nine months ended September 30, 2016:    
(in millions)
 
TRA Contingent Liability
Balance at December 31, 2015
 
$
63.0

Change in fair value adjustment recorded in other expense, net
 
1.8

Balance at March 31, 2016
 
64.8

Change in fair value adjustment recorded in other expense, net
 
2.0

Balance at June 30, 2016
 
66.8

Change in fair value adjustment recorded in other expense, net
 
1.0

Balance at September 30, 2016
 
$
67.8



For the TRA contingent liability, there have been no transfers between the fair value measurement levels for the three and nine months ended September 30, 2017. The Company recognizes transfers between the fair value measurement levels at the end of the reporting period.

The preliminary purchase price allocation for the acquisition of AAC, described in Note 2, 2017 Acquisition, includes $30.0 million for the estimated fair value of an earn-out liability. The maximum amount payable for the earn-out is $50.0 million payable in increments at the first and second anniversaries of the Acquisition Date. The final earn-out amount will be determined based on actual growth rates in revenue and gross profit. The preliminary fair value estimate was based on historic growth patterns and future forecasts, which are Level 3 data. Valuation inputs also included a discount rate of 8.3%. Actual results may differ from these estimates.
Earnings Per Share
Earnings (Loss) Per Share
10. EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share for Veritiv common stock is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is similarly calculated, except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued, except where the inclusion of such common shares would have an antidilutive impact.

A summary of the numerators and denominators used in the basic and diluted earnings (loss) per share calculations is as follows:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
(in millions, except per share data)
2017
 
2016
 
2017
 
2016
Numerator:
 
 
 
 
 
 
 
Net income (loss)
$
(14.3
)
 
$
5.6

 
$
(25.6
)
 
$
16.8

 
 
 
 
 
 
 
 
Denominator:
 
 
 
 
 
 
 
Weighted average number of shares outstanding – basic
15.70

 
16.00

 
15.70

 
16.00

Dilutive effect of stock-based awards

 
0.27

 

 
0.05

Weighted average number of shares outstanding – diluted
15.70

 
16.27

 
15.70

 
16.05

 
 
 
 
 
 
 
 
Earnings (loss) per share:
 
 
 
 
 
 
 
     Basic earnings (loss) per share
$
(0.91
)
 
$
0.35

 
$
(1.63
)
 
$
1.05

     Diluted earnings (loss) per share
$
(0.91
)
 
$
0.34

 
$
(1.63
)
 
$
1.04

 
 
 
 
 
 
 
 
Antidilutive stock-based awards excluded from computation of diluted earnings per share ("EPS")
0.68

 
0.00

 
0.66

 
0.20

Performance stock-based awards excluded from computation of diluted EPS because performance conditions had not been met
0.48

 
0.33

 
0.48

 
0.33

Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Loss
11. ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table provides the components of accumulated other comprehensive loss ("AOCL") at September 30, 2017 (amounts are shown net of their related income tax effect, if any):
(in millions)
 
Foreign currency translation adjustments
 
Retirement liabilities
 
Interest rate swap
 
AOCL
Balance at December 31, 2016
 
$
(29.2
)
 
$
(9.1
)
 
$
(0.7
)
 
$
(39.0
)
     Unrealized net gains (losses) arising during the period
 
2.8

 
0.1

 
(0.1
)
 
2.8

Net current period other comprehensive income (loss)
 
2.8

 
0.1

 
(0.1
)
 
2.8

Balance at March 31, 2017
 
(26.4
)
 
(9.0
)
 
(0.8
)
 
(36.2
)
     Unrealized net gains (losses) arising during the period
 
2.6

 

 

 
2.6

Net current period other comprehensive income (loss)
 
2.6

 

 

 
2.6

Balance at June 30, 2017
 
(23.8
)
 
(9.0
)
 
(0.8
)
 
(33.6
)
     Unrealized net gains (losses) arising during the period
 
2.4

 

 

 
2.4

     Amounts reclassified from AOCL
 

 

 
0.1

 
0.1

Net current period other comprehensive income (loss)
 
2.4

 

 
0.1

 
2.5

Balance at September 30, 2017
 
$
(21.4
)
 
$
(9.0
)
 
$
(0.7
)
 
$
(31.1
)
    
The following table provides the components of AOCL at September 30, 2016 (amounts are shown net of their related income tax effect, if any):
(in millions)
 
Foreign currency translation adjustments
 
Retirement liabilities
 
Interest rate swap
 
AOCL
Balance at December 31, 2015
 
$
(27.1
)
 
$
(7.4
)
 
$
(0.5
)
 
$
(35.0
)
     Unrealized net gains (losses) arising during the period
 
3.8

 

 
(0.3
)
 
3.5

     Amounts reclassified from AOCL
 

 
0.1

 

 
0.1

Net current period other comprehensive income (loss)
 
3.8

 
0.1

 
(0.3
)
 
3.6

Balance at March 31, 2016
 
(23.3
)
 
(7.3
)
 
(0.8
)
 
(31.4
)
     Unrealized net gains (losses) arising during the period
 
(1.6
)
 

 
0.0

 
(1.6
)
     Amounts reclassified from AOCL
 

 
0.1

 

 
0.1

Net current period other comprehensive income (loss)
 
(1.6
)
 
0.1

 

 
(1.5
)
Balance at June 30, 2016
 
(24.9
)
 
(7.2
)
 
(0.8
)
 
(32.9
)
     Unrealized net gains (losses) arising during the period
 
(1.6
)
 

 

 
(1.6
)
Net current period other comprehensive income (loss)
 
(1.6
)
 

 

 
(1.6
)
Balance at September 30, 2016
 
$
(26.5
)
 
$
(7.2
)
 
$
(0.8
)
 
$
(34.5
)
Commitments and Contingencies
Commitments and Contingencies
12. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

From time to time, the Company is involved in various lawsuits, claims and regulatory and administrative proceedings arising out of its business relating to general commercial and contractual matters, governmental regulations, intellectual property rights, labor and employment matters, tax and other actions.

Although the ultimate outcome of any legal proceeding or investigation cannot be predicted with certainty, based on present information, including the Company's assessment of the merits of the particular claim, the Company does not expect that any asserted or unasserted legal claims or proceedings, individually or in the aggregate, will have a material adverse effect on its results of operations, financial condition or cash flows.

Escheat Audit

During 2013, Unisource was notified by the State of Delaware that it intended to examine the books and records of Unisource to determine compliance with Delaware escheat laws. Since that date, seven other states have joined with Delaware in the audit process, which is conducted by an outside firm on behalf of the states. While the original time period for the audit was from 1981 to present, recent legal developments have resulted in Delaware narrowing the time period from 1998 to present. The Company has been informed that similar audits have generally taken four years or more to complete.

In the third quarter of 2017, the Company recorded an estimated liability with respect to certain transactions in connection with the pending audit. The Company does not consider this amount to be material to the Company’s results of operations or financial condition. There are other transactions under audit based upon which potential liability cannot be reasonably estimated at this time. Any claims or liabilities resulting from the audit could have a material impact on the Company’s results of operations, financial condition or cash flows. The Company will continue to monitor the matter for any developments that would make the loss contingency associated with other transactions under audit probable or reasonably estimable.

New England Teamsters and Trucking Industry Pension Fund

During the second quarter of 2017, the Company closed its facility in Wilmington, Massachusetts as part of its plan to consolidate operations in the northeastern United States. In connection with this closure, the Company ceased contributions to the New England Teamsters and Trucking Industry Pension Fund (the “NE Fund”), a multi-employer pension plan, for participating employees who previously worked at this facility. In June 2017, the Company was presented with a Demand for Payment of Withdrawal Liability (the “Demand”) from the NE Fund in the amount of $10.9 million, payable in 240 equal monthly installments beginning in August 2017. The Company has assessed the merits of the Demand and, pursuant to Employee Retirement Income Security Act of 1974 ("ERISA") regulations, requested review of the Demand. The NE Fund responded, confirming its Demand and the Company is considering arbitration. A charge for the Demand was recorded as a component of restructuring charges in the Condensed Consolidated Statements of Operations for the nine months ended September 30, 2017. Depending on the Company's decision whether or not to arbitrate and the decision of such arbitration, an adjustment to the charge recorded for the withdrawal liability contained in the Demand may be required.

Also as part of this same consolidation, the Company's Windsor and Middletown, Connecticut facilities were closed and relocated to Enfield, Connecticut. Employees at both the Windsor and Middletown locations were covered by separate collective bargaining agreements. Employees at the Middletown location and those subject to this agreement also participate in the NE Fund. The Company is currently negotiating a new collective bargaining agreement for the Enfield, Connecticut facility to replace the legacy Windsor and Middletown, Connecticut agreements. If, as a result of these negotiations, participation in the NE Fund ends, the Company may incur an additional withdrawal liability charge.
Segment Information
Segment Information
13. SEGMENT INFORMATION

Veritiv's business is organized under four reportable segments: Packaging, Facility Solutions, Print, and Publishing and Print Management ("Publishing"). This segment structure is consistent with the way the Chief Operating Decision Maker, who is Veritiv's Chief Executive Officer, makes operating decisions and manages the growth and profitability of the Company’s business. The Company also has a Corporate & Other category, which includes certain assets and costs not primarily attributable to any of the reportable segments, as well as the Veritiv logistics solutions business, which provides transportation and warehousing solutions.
    
The following tables present net sales, Adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization, restructuring charges (income), acquisition and integration expenses and other similar charges including any severance costs, costs associated with warehouse and office openings or closings, consolidation, and relocation and other business optimization expenses, stock-based compensation expense, changes in the LIFO reserve, non-restructuring asset impairment charges, non-restructuring severance charges, non-restructuring pension charges, fair value adjustments on the contingent liability associated with the TRA and certain other adjustments), which is the metric management uses to assess operating performance of the segments, and certain other measures for each of the reportable segments and Corporate & Other for the periods presented:
    
(in millions)
Packaging
 
Facility Solutions
 
Print
 
Publishing
 
Total Reportable Segments
 
Corporate & Other
 
Total
Three Months Ended September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
799.6

 
$
339.6

 
$
701.6

 
$
238.7

 
$
2,079.5

 
$
37.3

 
$
2,116.8

Adjusted EBITDA
62.1

 
10.3

 
13.1

 
5.5

 
91.0

 
(46.9
)
 


Depreciation and amortization
4.0

 
1.6

 
2.7

 
0.2

 
8.5

 
4.6

 
13.1

Restructuring charges
5.8

 
1.9

 
5.9

 
0.0

 
13.6

 
(10.9
)
 
2.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
730.1

 
$
328.7

 
$
788.2

 
$
248.4

 
$
2,095.4

 
$
31.2

 
$
2,126.6

Adjusted EBITDA
59.5

 
13.0

 
20.0

 
6.6

 
99.1

 
(42.0
)
 


Depreciation and amortization
3.1

 
1.5

 
3.1

 
0.8

 
8.5

 
4.9

 
13.4

Restructuring charges
2.2

 
1.0

 
2.6

 
0.0

 
5.8

 
0.0

 
5.8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
2,266.0

 
$
975.5

 
$
2,095.1

 
$
696.6

 
$
6,033.2

 
$
107.1

 
$
6,140.3

Adjusted EBITDA
166.7

 
25.1

 
44.8

 
17.6

 
254.2

 
(137.8
)
 

Depreciation and amortization
10.5

 
4.5

 
7.9

 
1.3

 
24.2

 
15.7

 
39.9

Restructuring charges
12.3

 
5.2

 
12.2

 
0.0

 
29.7

 
0.3

 
30.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
2,106.4

 
$
951.6

 
$
2,299.0

 
$
763.2

 
$
6,120.2

 
$
87.0

 
$
6,207.2

Adjusted EBITDA
165.4

 
34.3

 
55.7

 
16.4

 
271.8

 
(129.7
)
 

Depreciation and amortization
9.3

 
4.5

 
9.5

 
2.5

 
25.8

 
14.7

 
40.5

Restructuring charges
2.6

 
1.5

 
2.9

 
0.0

 
7.0

 
0.2

 
7.2


    
    

The table below presents a reconciliation of income (loss) before income taxes as reflected in the Condensed Consolidated Statements of Operations to Adjusted EBITDA for the reportable segments:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
(in millions)
2017
 
2016
 
2017
 
2016
Income (loss) before income taxes
$
(18.3
)
 
$
13.6

 
$
(38.7
)
 
$
35.2

Interest expense, net
8.3

 
8.2

 
22.1

 
21.1

Depreciation and amortization
13.1

 
13.4

 
39.9

 
40.5

Restructuring charges
2.7

 
5.8

 
30.0

 
7.2

Stock-based compensation
3.8

 
2.1

 
11.6

 
7.2

LIFO reserve increase (decrease)
3.7

 
0.4

 
3.4

 
(2.7
)
Non-restructuring asset impairment charges
7.7

 
3.1

 
8.4

 
4.0

Non-restructuring severance charges
0.5

 
0.2

 
1.5

 
2.4

Non-restructuring pension charges
3.2

 
2.3

 
2.1

 
2.3

Acquisition and integration expenses
14.2

 
7.3

 
28.1

 
19.6

Fair value adjustments on TRA contingent liability
(0.4
)
 
1.0

 
1.6

 
4.8

Other
5.6

 
(0.3
)
 
6.4

 
0.5

Adjustment for Corporate & Other
46.9

 
42.0

 
137.8

 
129.7

Adjusted EBITDA for reportable segments
$
91.0

 
$
99.1

 
$
254.2

 
$
271.8




The following table summarizes total assets as of September 30, 2017:

(in millions)
September 30, 2017

 
December 31, 2016
Packaging
$
1,137.3

 
$
875.9

Facility Solutions
424.1

 
397.9

Print
883.6

 
874.1

Publishing
178.3

 
170.0

Corporate & Other
151.8

 
165.8

Total assets
$
2,775.1

 
$
2,483.7

Business and Summary of Significant Accounting Policies (Policies)
Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for a complete set of annual audited financial statements.

The accompanying unaudited financial information should be read in conjunction with the Consolidated and Combined Financial Statements and Notes contained in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2016. In the opinion of management, all adjustments, including normal recurring accruals and other adjustments, considered necessary for a fair presentation of the interim financial information have been included. The operating results for the interim periods are not necessarily indicative of results for the full year.

All significant intercompany transactions between Veritiv's businesses have been eliminated.
    
        
Use of Estimates

The preparation of unaudited financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and certain financial statement disclosures. Estimates and assumptions are used for, but not limited to, revenue recognition, accounts receivable valuation, inventory valuation, employee benefit plans, income tax contingency accruals and valuation allowances, multi-employer pension plan withdrawal liabilities and goodwill and other intangible asset valuations. Although these estimates are based on management's knowledge of current events and actions it may undertake in the future, actual results may ultimately differ from these estimates and assumptions. Estimates are revised as additional information becomes available.
Recently Issued Accounting Standards Not Yet Adopted
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial Statements or Other Significant Matters
Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606)
 
The standard will replace existing revenue recognition standards and significantly expand the disclosure requirements for revenue arrangements. It may be adopted either retrospectively or on a modified retrospective basis to new contracts and existing contracts with remaining performance obligations as of the effective date.
 
January 1, 2018; early adoption date is no earlier than the annual period beginning after December 15, 2016
 
The Company’s analysis of the impact of this standard is ongoing. Focus areas include the impacts of accounting for customer dedicated inventory and principal/agent considerations. During the third quarter, work continued on the disclosure requirements and internal control assessments. As the analysis is not yet complete, the Company cannot provide a financial impact assessment at this time, nor provide a determination as to the effect of the new standard on its internal control over financial reporting and other changes in business practices and processes. The Company anticipates applying the modified retrospective method of adoption. The Company will adopt this ASU on January 1, 2018.

ASU 2016-02, Leases (Topic 842)
 
The standard requires lessees to put most leases on their balance sheet but recognize expenses in their statement of operations in a manner similar to current accounting guidance. The new standard also eliminates the current guidance related to real estate specific provisions. The guidance requires application on a modified retrospective basis to leases that existed at the beginning of the earliest period presented and those entered into thereafter but prior to the effective date. The standard permits entities to elect a package of practical expedients which must be applied consistently to all leases that commenced prior to the effective date. If the package of practical expedients is elected, entities do not need to reassess: (i) whether expired or existing contracts contain leases; (ii) lease classification for any expired or existing leases; and (iii) initial direct costs for any existing leases. The guidance also allows entities to make certain policy elections under the new standard, including: (i) the use of hindsight to determine lease term and when assessing existing right of use assets for impairment; (ii) a policy to not record short-term leases on the balance sheet; and (iii) a policy to not separate lease and non-lease components.

 
January 1, 2019; early adoption is permitted
 
The Company is currently evaluating this standard and anticipates that its adoption will have a material impact on the Consolidated Financial Statements and related disclosures as it will result in recording virtually all operating leases on the balance sheet as a lease obligation and right of use asset. The Company’s preliminary assessment has focused on system readiness and the policy elections and practical expedients permitted by the standard. Lease software has been implemented that will better enable the Company to implement the standard. The Company currently anticipates electing to apply the package of practical expedients to all leases that commenced prior to the date of adoption. Based on the analysis performed to date, the Company anticipates making a policy election to not include short-term leases on the Consolidated Balance Sheets and to separate lease and non-lease components. A decision has not been made regarding the use of hindsight when determining lease term and assessing existing right of use assets for impairment. The assessment is ongoing and the preliminary conclusions are subject to change. At this time the Company is unable to quantify the impact that the adoption of this standard will have on the Consolidated Financial Statements and related disclosures. The Company currently plans to adopt this ASU on January 1, 2019.

 
 
 
 
 
 
 
Recently Issued Accounting Standards Not Yet Adopted (continued)
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial Statements or Other Significant Matters
ASU 2016-13, Financial Instruments-Credit Losses (Topic 326)
 
The standard will replace the currently required incurred loss impairment methodology with guidance that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to be considered in making credit loss estimates. The guidance requires application on a modified retrospective basis. Other application requirements exist for specific assets impacted by a more-than-insignificant credit deterioration since origination.
 
January 1, 2020; early adoption is permitted for fiscal years beginning after December 15, 2018
 
The Company is currently evaluating the impact this ASU will have on its Consolidated Financial Statements and related disclosures. The Company currently plans to adopt this ASU on January 1, 2020.
ASU 2016-15, Statement of Cash Flows (Topic 230)

 
The standard addresses eight specific cash flow issues and is intended to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The guidance requires application on a retrospective basis.

 
January 1, 2018; early adoption is permitted (early adoption requires the adoption of all amendments in the same period)

 
The Company is currently evaluating the impact this ASU will have on its Consolidated Financial Statements and related disclosures; the impact is not expected to be material. The Company will adopt this ASU on January 1, 2018.
ASU 2017-01, Business Combinations (Topic 805)
 
The standard clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The guidance requires application on a prospective basis.
 
January 1, 2018; early adoption is permitted
 
The Company will adopt this ASU on January 1, 2018.
ASU 2017-07, Compensation-Retirement Benefits (Topic 715)
 
The standard requires employers to disaggregate the service cost component from the other components of net benefit cost and disclose the amount of net benefit cost that is included in the income statement or capitalized in assets, by line item. The standard requires employers to report the service cost component in the same line item(s) as other compensation costs and to report other pension-related costs (which include interest costs, amortization of pension-related costs from prior periods and the gains or losses on plan assets) separately and exclude them from the subtotal of operating income. The standard also allows only the service cost component to be eligible for capitalization when applicable. The guidance requires application on a retrospective basis for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and on a prospective basis for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets.
 
January 1, 2018; early adoption is permitted as of the first interim period of an annual period for which interim or annual financial statements have not been issued
 
The Company is currently making its assessment of the impact that this ASU will have on its Consolidated Financial Statements and related disclosures using results from 2016 and year-to-date 2017; the impact is not expected to be material. The Company will adopt this ASU on January 1, 2018.


Recently Adopted Accounting Standards
 
 
 
 
Standard
 
Description
 
Effective Date
 
Effect on the Financial Statements or Other Significant Matters
ASU 2015-11, Inventory - Simplifying the Measurement of Inventory (Topic 330)
 
The standard requires companies to measure inventory at the lower of cost and net realizable value, thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market. This ASU does not apply to inventories measured by either the last-in first-out ("LIFO") method or retail inventory method. The guidance requires application on a prospective basis.
 
January 1, 2017
 
The Company adopted this ASU on January 1, 2017. The adoption did not materially impact its Consolidated Financial Statements or related disclosures. As of September 30, 2017, approximately 87% of the inventory balance was measured using LIFO.
ASU 2017-04, Intangibles - Goodwill and Other (Topic 350)
 
The standard simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. Step 2 measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The guidance requires application on a prospective basis.
 
January 1, 2020; early adoption is permitted
 
The Company adopted this ASU on January 1, 2017.
ASU 2017-09, Compensation - Stock Compensation (Topic 718)
 
The standard clarifies the changes to the terms and conditions of a share-based payment award that require an entity to apply modification accounting. The guidance requires application on a prospective basis.
 
January 1, 2018; early adoption is permitted
 
The Company adopted this ASU on April 1, 2017. The adoption did not materially impact its Consolidated Financial Statements or related disclosures.
2017 Acquisition (Tables)
The following table summarizes the components of the preliminary estimated purchase price for AAC:

Preliminary estimated purchase price:
 
(in millions)
Cash consideration
$
112.0

Repayment of loans
34.3

Contingent consideration: Earn-out
30.0

Contingent bonus tax payment
0.3

Total preliminary estimated purchase price
$
176.6

Preliminary allocation:
 
(in millions)
Cash
$
1.5

Accounts receivable
30.4

Inventories
39.2

Other current assets
5.7

Property and equipment
2.2

Goodwill
61.2

Other intangible assets
51.2

Other non-current assets
0.9

Accounts payable
(12.4
)
Other current liabilities
(2.7
)
Other non-current liabilities
(0.6
)
Total preliminary estimated purchase price
$
176.6

Accordingly, the unaudited pro forma financial information is not necessarily indicative of the results of operations as they would have been had the transaction been effected on the assumed date, nor is it necessarily an indication of future operating results.

(Unaudited)
Three Months Ended September 30,
 
Nine Months Ended September 30,
(in millions, except share and per share data)
2017
 
2016
 
2017
 
2016
Net sales
$
2,157.8

 
$
2,181.9

 
$
6,303.2

 
$
6,378.3

Net income (loss)
(11.3
)
 
5.4

 
(21.5
)
 
12.0

Earnings (loss) per share:
 
 
 
 
 
 
 
Basic earnings (loss) per share
$
(0.72
)
 
$
0.34

 
$
(1.37
)
 
$
0.75

Diluted earnings (loss) per share
$
(0.72
)
 
$
0.33

 
$
(1.37
)
 
$
0.75

Weighted-average shares outstanding
 
 
 
 
 
 
 
Basic
15.70

 
16.00

 
15.70

 
16.00

Diluted
15.70

 
16.27

 
15.70

 
16.05

Acquisition Integration and Restructuring Charges (Tables)
The following table summarizes the components of acquisition and integration expenses:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
(in millions)
2017
 
2016
 
2017
 
2016
Integration management
$
3.8

 
$
2.2

 
$
10.5

 
$
6.0

Retention compensation

 
0.4

 
0.2

 
2.4

Information technology conversion costs
2.8

 
1.9

 
6.8

 
4.3

Rebranding
0.1

 
0.9

 
0.4

 
2.1

Legal, consulting and other professional fees
0.4

 
0.8

 
1.3

 
1.8

Other
0.6

 
1.1

 
2.4

 
3.0

AAC acquisition and integration
6.5

 

 
6.5

 

Total acquisition and integration expenses
$
14.2

 
$
7.3

 
$
28.1

 
$
19.6

The following is a summary of the Company's restructuring activity for the three and nine months ended September 30, 2016:
(in millions)
Severance and Related Costs
 
Other Direct Costs
 
Total
Balance at December 31, 2015
$
1.7

 
$
0.4

 
$
2.1

Costs incurred
0.7

 
0.3

 
1.0

Payments
(0.9
)
 
(0.4
)
 
(1.3
)
Balance at March 31, 2016
1.5

 
0.3

 
1.8

Costs incurred
0.9

 
1.5

 
2.4

Payments
(0.6
)
 
(1.0
)
 
(1.6
)
Balance at June 30, 2016
1.8

 
0.8

 
2.6

Costs incurred
0.3

 
5.4

 
5.7

Payments
(1.0
)
 
(0.7
)
 
(1.7
)
Balance at September 30, 2016
$
1.1

 
$
5.5

 
$
6.6

The following is a summary of the Company's restructuring activity for the three and nine months ended September 30, 2017:
(in millions)
Severance and Related Costs
 
Other Direct Costs
 
Total
Balance at December 31, 2016
$
1.8

 
$
8.0

 
$
9.8

Costs incurred
1.4

 
3.1

 
4.5

Payments
(1.2
)
 
(2.8
)
 
(4.0
)
Balance at March 31, 2017
2.0

 
8.3

 
10.3

Costs incurred
3.9

 
19.7

 
23.6

Payments
(2.0
)
 
(5.4
)
 
(7.4
)
Balance at June 30, 2017
3.9

 
22.6

 
26.5

Costs incurred
0.7

 
3.8

 
4.5

Payments
(0.7
)
 
(4.7
)
 
(5.4
)
Balance at September 30, 2017
$
3.9

 
$
21.7

 
$
25.6



Goodwill and Other Intangible Assets (Tables)
The following table sets forth the changes in the carrying amount of goodwill during the three and nine months ended September 30, 2017:

(in millions)
Packaging
 
Corporate & Other
 
Total
Balance at December 31, 2016:
 
 
 
 
 
   Goodwill
$
44.1

 
$
6.1

 
$
50.2

   Accumulated impairment losses

 

 

      Net goodwill 2016
44.1

 
6.1

 
50.2

2017 Activity:
 
 
 
 
 
   Goodwill acquired
61.2

 

 
61.2

   Impairment of goodwill

 
(6.1
)
 
(6.1
)
Balance at September 30, 2017:


 

 

   Goodwill
105.3

 
6.1

 
111.4

   Accumulated impairment losses

 
(6.1
)
 
(6.1
)
      Net goodwill at September 30, 2017
$
105.3

 
$

 
$
105.3

The components of the Company's other intangible assets were as follows:
 
September 30, 2017
 
December 31, 2016
(in millions)
Gross Carrying Amount
 
Accumulated Amortization
 
Net
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net
Customer relationships
$
64.9

 
$
5.0

 
$
59.9

 
$
23.6

 
$
4.0

 
$
19.6

Trademarks/Trade names
7.8

 
1.9

 
5.9

 
2.7

 
1.3

 
1.4

Non-compete agreements
2.6

 
0.1

 
2.5

 

 

 

     Total
$
75.3

 
$
7.0

 
$
68.3

 
$
26.3

 
$
5.3

 
$
21.0

Preliminary allocated values from the AAC acquisition are as follows:
 
Gross Value (in millions)
 
Estimated Useful Life (in years)
Customer relationships
$
43.5

 
10
Trademarks/Trade names
5.1

 
5
Non-compete agreements
2.6

 
2
Total identifiable intangible assets acquired
$
51.2

 
 
Debt And Other Obligations (Tables)
Long-term Obligations
The Company's long-term debt obligations were as follows:
(in millions)
September 30, 2017
 
December 31, 2016
Asset-Based Lending Facility (the "ABL Facility")
$
969.3

 
$
726.9

Equipment capital lease and other obligations
4.5

 
25.2

Total debt
973.8

 
752.1

Less: current maturities of long-term debt
(1.8
)
 
(2.9
)
Long-term debt, net of current maturities
$
972.0

 
$
749.2

The Company's long-term financing obligations were as follows:
(in millions)
September 30, 2017
 
December 31, 2016
Obligations to related party
$
165.6

 
$
191.0

Obligations - other financing
27.4

 

Total financing obligations
193.0

 
191.0

Less: current portion of financing obligations
(11.1
)
 
(14.9
)
Financing obligations, less current portion
$
181.9

 
$
176.1

Income Taxes (Tables)
Provision for Income Taxes and the Effective Tax Rates
The following table presents the provision for income taxes and the effective tax rates for the three and nine months ended September 30, 2017 and 2016:
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
(in millions)
2017
 
2016
 
2017
 
2016
Income (loss) before income taxes
$
(18.3
)
 
$
13.6

 
$
(38.7
)
 
$
35.2

Income tax expense (benefit)
(4.0
)
 
8.0

 
(13.1
)
 
18.4

Effective tax rate
21.9
%
 
58.8
%
 
33.9
%
 
52.3
%
Related Party Transactions (Tables)
Summarized Financial Impact of Transactions with Related Party
The following tables summarize the financial impact of these related party transactions with Georgia-Pacific:
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
(in millions)
 
2017
 
2016
 
2017
 
2016
Sales to Georgia-Pacific, reflected in net sales
 
$
8.6

 
$
8.5

 
$
24.9

 
$
26.6

Purchases of inventory from Georgia-Pacific, recognized in cost of products sold
 
45.7

 
71.4

 
138.0

 
174.3


(in millions)
 
September 30, 2017
 
December 31, 2016
Inventories purchased from Georgia-Pacific that remained on Veritiv's balance sheet
 
$
23.5

 
$
24.8

Related party payable to Georgia-Pacific
 
11.2

 
9.0

Related party receivable from Georgia-Pacific
 
3.8

 
3.9

Defined Benefit Plans (Tables)
Net Periodic Benefit Costs and Credits
Net periodic benefit cost (credit) associated with these plans is summarized below:
    
 
Three Months Ended September 30, 2017
 
Three Months Ended September 30, 2016
(in millions)
U.S.
 
Canada
 
U.S.
 
Canada
Components of net periodic benefit cost (credit):
 
 
 
 
 
 
 
Service cost
$
0.5

 
$
0.0

 
$
0.4

 
$
0.1

Interest cost
0.6

 
0.8

 
0.7

 
0.8

Expected return on plan assets
(1.2
)
 
(1.0
)
 
(1.2
)
 
(0.9
)
Amortization of net loss
0.1

 
0.0

 
0.0

 
0.0

Net periodic benefit cost (credit)
$
0.0

 
$
(0.2
)
 
$
(0.1
)
 
$
0.0


        
 
Nine Months Ended September 30, 2017
 
Nine Months Ended September 30, 2016
(in millions)
U.S.
 
Canada
 
U.S.
 
Canada
Components of net periodic benefit cost (credit):
 
 
 
 
 
 
 
Service cost
$
1.5

 
$
0.2

 
$
1.3

 
$
0.2

Interest cost
2.0

 
2.1

 
2.5

 
2.4

Expected return on plan assets
(3.8
)
 
(2.8
)
 
(3.8
)
 
(2.7
)
Amortization of net loss
0.1

 
0.1

 
0.1

 
0.1

Net periodic benefit cost (credit)
$
(0.2
)
 
$
(0.4
)
 
$
0.1

 
$
0.0

Fair Value Measurements (Tables)
The Company's liabilities disclosed at fair value at September 30, 2017 were as follows:
(in millions)
 
Total

Level 1

Level 2

Level 3
ABL Facility
 
$
969.3



 
$
969.3

 

Tax Receivable Agreement
 
61.0



 

 
61.0

Contingent Consideration: Earn-out
 
30.0

 
 
 
 
 
30.0


The Company's liabilities disclosed at fair value at December 31, 2016 were as follows:
(in millions)
 
Total
 
Level 1
 
Level 2
 
Level 3
ABL Facility
 
$
726.9

 

 
$
726.9

 

Tax Receivable Agreement
 
67.9

 

 

 
67.9

The following table provides a reconciliation of the beginning and ending balance of the TRA contingent liability for the three and nine months ended September 30, 2017:    
(in millions)
 
TRA Contingent Liability
Balance at December 31, 2016
 
$
67.9

Change in fair value adjustment recorded in other expense, net
 
0.9

Principal payment
 
(8.5
)
Balance at March 31, 2017
 
60.3

Change in fair value adjustment recorded in other expense, net
 
1.1

Balance at June 30, 2017
 
61.4

Change in fair value adjustment recorded in other expense, net
 
(0.4
)
Balance at September 30, 2017
 
$
61.0



The following table provides a reconciliation of the beginning and ending balance of the TRA contingent liability for the three and nine months ended September 30, 2016:    
(in millions)
 
TRA Contingent Liability
Balance at December 31, 2015
 
$
63.0

Change in fair value adjustment recorded in other expense, net
 
1.8

Balance at March 31, 2016
 
64.8

Change in fair value adjustment recorded in other expense, net
 
2.0

Balance at June 30, 2016
 
66.8

Change in fair value adjustment recorded in other expense, net
 
1.0

Balance at September 30, 2016
 
$
67.8

Earnings (Loss) Per Share (Tables)
Summary of the Numerators and Denominators Used in the Basic and Diluted Earnings Per Share Calculation
A summary of the numerators and denominators used in the basic and diluted earnings (loss) per share calculations is as follows:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
(in millions, except per share data)
2017
 
2016
 
2017
 
2016
Numerator:
 
 
 
 
 
 
 
Net income (loss)
$
(14.3
)
 
$
5.6

 
$
(25.6
)
 
$
16.8

 
 
 
 
 
 
 
 
Denominator:
 
 
 
 
 
 
 
Weighted average number of shares outstanding – basic
15.70

 
16.00

 
15.70

 
16.00

Dilutive effect of stock-based awards

 
0.27

 

 
0.05

Weighted average number of shares outstanding – diluted
15.70

 
16.27

 
15.70

 
16.05

 
 
 
 
 
 
 
 
Earnings (loss) per share:
 
 
 
 
 
 
 
     Basic earnings (loss) per share
$
(0.91
)
 
$
0.35

 
$
(1.63
)
 
$
1.05

     Diluted earnings (loss) per share
$
(0.91
)
 
$
0.34

 
$
(1.63
)
 
$
1.04

 
 
 
 
 
 
 
 
Antidilutive stock-based awards excluded from computation of diluted earnings per share ("EPS")
0.68

 
0.00

 
0.66

 
0.20

Performance stock-based awards excluded from computation of diluted EPS because performance conditions had not been met
0.48

 
0.33

 
0.48

 
0.33

Accumulated Other Comprehensive Loss (Tables)
Components of Accumulated Other Comprehensive Loss
The following table provides the components of accumulated other comprehensive loss ("AOCL") at September 30, 2017 (amounts are shown net of their related income tax effect, if any):
(in millions)
 
Foreign currency translation adjustments
 
Retirement liabilities
 
Interest rate swap
 
AOCL
Balance at December 31, 2016
 
$
(29.2
)
 
$
(9.1
)
 
$
(0.7
)
 
$
(39.0
)
     Unrealized net gains (losses) arising during the period
 
2.8

 
0.1

 
(0.1
)
 
2.8

Net current period other comprehensive income (loss)
 
2.8

 
0.1

 
(0.1
)
 
2.8

Balance at March 31, 2017
 
(26.4
)
 
(9.0
)
 
(0.8
)
 
(36.2
)
     Unrealized net gains (losses) arising during the period
 
2.6

 

 

 
2.6

Net current period other comprehensive income (loss)
 
2.6

 

 

 
2.6

Balance at June 30, 2017
 
(23.8
)
 
(9.0
)
 
(0.8
)
 
(33.6
)
     Unrealized net gains (losses) arising during the period
 
2.4

 

 

 
2.4

     Amounts reclassified from AOCL
 

 

 
0.1

 
0.1

Net current period other comprehensive income (loss)
 
2.4

 

 
0.1

 
2.5

Balance at September 30, 2017
 
$
(21.4
)
 
$
(9.0
)
 
$
(0.7
)
 
$
(31.1
)
    
The following table provides the components of AOCL at September 30, 2016 (amounts are shown net of their related income tax effect, if any):
(in millions)
 
Foreign currency translation adjustments
 
Retirement liabilities
 
Interest rate swap
 
AOCL
Balance at December 31, 2015
 
$
(27.1
)
 
$
(7.4
)
 
$
(0.5
)
 
$
(35.0
)
     Unrealized net gains (losses) arising during the period
 
3.8

 

 
(0.3
)
 
3.5

     Amounts reclassified from AOCL
 

 
0.1

 

 
0.1

Net current period other comprehensive income (loss)
 
3.8

 
0.1

 
(0.3
)
 
3.6

Balance at March 31, 2016
 
(23.3
)
 
(7.3
)
 
(0.8
)
 
(31.4
)
     Unrealized net gains (losses) arising during the period
 
(1.6
)
 

 
0.0

 
(1.6
)
     Amounts reclassified from AOCL
 

 
0.1

 

 
0.1

Net current period other comprehensive income (loss)
 
(1.6
)
 
0.1

 

 
(1.5
)
Balance at June 30, 2016
 
(24.9
)
 
(7.2
)
 
(0.8
)
 
(32.9
)
     Unrealized net gains (losses) arising during the period
 
(1.6
)
 

 

 
(1.6
)
Net current period other comprehensive income (loss)
 
(1.6
)
 

 

 
(1.6
)
Balance at September 30, 2016
 
$
(26.5
)
 
$
(7.2
)
 
$
(0.8
)
 
$
(34.5
)



Segment Information (Tables)
The table below presents a reconciliation of income (loss) before income taxes as reflected in the Condensed Consolidated Statements of Operations to Adjusted EBITDA for the reportable segments:
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
(in millions)
2017
 
2016
 
2017
 
2016
Income (loss) before income taxes
$
(18.3
)
 
$
13.6

 
$
(38.7
)
 
$
35.2

Interest expense, net
8.3

 
8.2

 
22.1

 
21.1

Depreciation and amortization
13.1

 
13.4

 
39.9

 
40.5

Restructuring charges
2.7

 
5.8

 
30.0

 
7.2

Stock-based compensation
3.8

 
2.1

 
11.6

 
7.2

LIFO reserve increase (decrease)
3.7

 
0.4

 
3.4

 
(2.7
)
Non-restructuring asset impairment charges
7.7

 
3.1

 
8.4

 
4.0

Non-restructuring severance charges
0.5

 
0.2

 
1.5

 
2.4

Non-restructuring pension charges
3.2

 
2.3

 
2.1

 
2.3

Acquisition and integration expenses
14.2

 
7.3

 
28.1

 
19.6

Fair value adjustments on TRA contingent liability
(0.4
)
 
1.0

 
1.6

 
4.8

Other
5.6

 
(0.3
)
 
6.4

 
0.5

Adjustment for Corporate & Other
46.9

 
42.0

 
137.8

 
129.7

Adjusted EBITDA for reportable segments
$
91.0

 
$
99.1

 
$
254.2

 
$
271.8


The following table summarizes total assets as of September 30, 2017:

(in millions)
September 30, 2017

 
December 31, 2016
Packaging
$
1,137.3

 
$
875.9

Facility Solutions
424.1

 
397.9

Print
883.6

 
874.1

Publishing
178.3

 
170.0

Corporate & Other
151.8

 
165.8

Total assets
$
2,775.1

 
$
2,483.7

The following tables present net sales, Adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization, restructuring charges (income), acquisition and integration expenses and other similar charges including any severance costs, costs associated with warehouse and office openings or closings, consolidation, and relocation and other business optimization expenses, stock-based compensation expense, changes in the LIFO reserve, non-restructuring asset impairment charges, non-restructuring severance charges, non-restructuring pension charges, fair value adjustments on the contingent liability associated with the TRA and certain other adjustments), which is the metric management uses to assess operating performance of the segments, and certain other measures for each of the reportable segments and Corporate & Other for the periods presented:
    
(in millions)
Packaging
 
Facility Solutions
 
Print
 
Publishing
 
Total Reportable Segments
 
Corporate & Other
 
Total
Three Months Ended September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
799.6

 
$
339.6

 
$
701.6

 
$
238.7

 
$
2,079.5

 
$
37.3

 
$
2,116.8

Adjusted EBITDA
62.1

 
10.3

 
13.1

 
5.5

 
91.0

 
(46.9
)
 


Depreciation and amortization
4.0

 
1.6

 
2.7

 
0.2

 
8.5

 
4.6

 
13.1

Restructuring charges
5.8

 
1.9

 
5.9

 
0.0

 
13.6

 
(10.9
)
 
2.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
730.1

 
$
328.7

 
$
788.2

 
$
248.4

 
$
2,095.4

 
$
31.2

 
$
2,126.6

Adjusted EBITDA
59.5

 
13.0

 
20.0

 
6.6

 
99.1

 
(42.0
)
 


Depreciation and amortization
3.1

 
1.5

 
3.1

 
0.8

 
8.5

 
4.9

 
13.4

Restructuring charges
2.2

 
1.0

 
2.6

 
0.0

 
5.8

 
0.0

 
5.8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2017
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
2,266.0

 
$
975.5

 
$
2,095.1

 
$
696.6

 
$
6,033.2

 
$
107.1

 
$
6,140.3

Adjusted EBITDA
166.7

 
25.1

 
44.8

 
17.6

 
254.2

 
(137.8
)
 

Depreciation and amortization
10.5

 
4.5

 
7.9

 
1.3

 
24.2

 
15.7

 
39.9

Restructuring charges
12.3

 
5.2

 
12.2

 
0.0

 
29.7

 
0.3

 
30.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
Net sales
$
2,106.4

 
$
951.6

 
$
2,299.0

 
$
763.2

 
$
6,120.2

 
$
87.0

 
$
6,207.2

Adjusted EBITDA
165.4

 
34.3

 
55.7

 
16.4

 
271.8

 
(129.7
)
 

Depreciation and amortization
9.3

 
4.5

 
9.5

 
2.5

 
25.8

 
14.7

 
40.5

Restructuring charges
2.6

 
1.5

 
2.9

 
0.0

 
7.0

 
0.2

 
7.2

Business and Summary of Significant Accounting Policies - Narrative (Details)
Sep. 30, 2017
Distribution_Center
Organization, Consolidation and Presentation of Financial Statements [Abstract]
 
Number of distribution centers
170 
Percentage of LIFO inventory
87.00% 
2017 Acquisition - Narrative (Details) (USD $)
In Millions, unless otherwise specified
0 Months Ended 1 Months Ended 3 Months Ended 9 Months Ended
Aug. 31, 2017
Sep. 30, 2017
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Aug. 31, 2017
Business Acquisition [Line Items]
 
 
 
 
 
 
 
Net sales
 
 
$ 2,116.8 
$ 2,126.6 
$ 6,140.3 
$ 6,207.2 
 
Acquisition and integration expenses
 
 
14.2 
7.3 
28.1 
19.6 
 
Depreciation and amortization
 
 
13.1 
13.4 
39.9 
40.5 
 
Interest expense
 
 
8.3 
8.2 
22.1 
21.1 
 
All American Containers
 
 
 
 
 
 
 
Business Acquisition [Line Items]
 
 
 
 
 
 
 
Percent of business acquired
 
 
 
 
 
 
100.00% 
Acquisition related costs
6.3 
 
 
 
 
 
 
Payments to acquire business
176.6 
 
 
 
 
 
 
Net sales
 
16.0 
 
 
 
 
 
Net income before tax
 
(0.9)
 
 
 
 
 
Acquisition and integration expenses
 
 
6.5 
6.5 
 
Income tax rate used to determine after-tax impact on net income of pro forma adjustments
 
 
 
39.00% 
 
 
 
Acquisition-related Costs |
All American Containers
 
 
 
 
 
 
 
Business Acquisition [Line Items]
 
 
 
 
 
 
 
Acquisition and integration expenses
 
 
(6.9)
(7.4)
7.4 
 
Depreciation and amortization
 
 
1.1 
1.7 
4.4 
5.0 
 
Interest expense
 
 
$ 0.5 
$ 0.6 
$ 2.0 
$ 1.8 
 
2017 Acquisition - Schedule of Purchase Price (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended 0 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Aug. 31, 2017
All American Containers
Business Acquisition [Line Items]
 
 
 
Cash consideration
$ 144.8 
$ 0 
$ 112.0 
Repayment of loans
 
 
34.3 
Contingent consideration: Earn-out
 
 
30.0 
Contingent bonus tax payment
 
 
0.3 
Total preliminary estimated purchase price
 
 
$ 176.6 
2017 Acquisition - Schedule of Preliminary Purchase Price Allocation (Details) (All American Containers, USD $)
In Millions, unless otherwise specified
Aug. 31, 2017
All American Containers
 
Business Acquisition [Line Items]
 
Cash
$ 1.5 
Accounts receivable
30.4 
Inventories
39.2 
Other current assets
5.7 
Property and equipment
2.2 
Goodwill
61.2 
Other intangible assets
51.2 
Other non-current assets
0.9 
Accounts payable
(12.4)
Other current liabilities
(2.7)
Other non-current liabilities
(0.6)
Total preliminary estimated purchase price
$ 176.6 
2017 Acquisition - Schedule of Pro Forma Information (Details) (All American Containers, USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
All American Containers
 
 
 
 
Business Acquisition, Pro Forma Information [Abstract]
 
 
 
 
Net sales
$ 2,157.8 
$ 2,181.9 
$ 6,303.2 
$ 6,378.3 
Net income (loss)
$ (11.3)
$ 5.4 
$ (21.5)
$ 12.0 
Basic earnings (loss) per share (in dollars per share)
$ 0 
$ 0.34 
$ (1.37)
$ 0.75 
Diluted earnings (loss) per share (in dollars per share)
$ 0 
$ 0.33 
$ (1.37)
$ 0.75 
Weighted average shares outstanding, basic (in shares)
15.70 
16.00 
15.70 
16.00 
Weighted average shares outstanding, diluted (in shares)
15.70 
16.27 
15.70 
16.05 
Acquisition Integration and Restructuring Charges - Narrative (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended 39 Months Ended 62 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 1, 2019
Scenario, Forecast
Sep. 1, 2019
Scenario, Forecast
Minimum
Sep. 1, 2019
Scenario, Forecast
Maximum
Sep. 30, 2016
Severance and Related Costs
Sep. 30, 2017
Veritiv Restructuring Plan
Sep. 30, 2016
Veritiv Restructuring Plan
Sep. 30, 2017
Veritiv Restructuring Plan
Sep. 30, 2016
Veritiv Restructuring Plan
Sep. 30, 2017
Veritiv Restructuring Plan
MEPP Withdrawal Estimate
Sep. 30, 2017
Veritiv Restructuring Plan
Severance and Related Costs
Jun. 30, 2017
Veritiv Restructuring Plan
Severance and Related Costs
Mar. 31, 2017
Veritiv Restructuring Plan
Severance and Related Costs
Jun. 30, 2016
Veritiv Restructuring Plan
Severance and Related Costs
Mar. 31, 2016
Veritiv Restructuring Plan
Severance and Related Costs
Sep. 30, 2017
Veritiv Restructuring Plan
Severance and Related Costs
Sep. 30, 2017
Veritiv Restructuring Plan
Non-Cash Items
Sep. 30, 2016
Veritiv Restructuring Plan
Non-Cash Items
Sep. 30, 2017
Veritiv Restructuring Plan
Non-Cash Items
Sep. 30, 2016
Veritiv Restructuring Plan
Non-Cash Items
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets held for sale
$ 4.2 
 
$ 4.2 
 
$ 4.2 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Integration and restructuring charges including capital expenditures
 
 
 
 
233 
 
225 
250 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Integration and restructuring charges, capital expenditures
 
 
 
 
78 
105 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
2.7 
5.8 
30.0 
7.2 
 
 
 
 
0.3 
2.7 
5.8 
30.0 
7.2 
15.5 
0.7 
3.9 
1.4 
0.9 
0.7 
4.1 
 
 
 
 
Non-cash gain (loss) on restructuring activities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 1.8 
$ (0.1)
$ 2.6 
$ 1.9 
Acquisition Integration and Restructuring Charges - Summary of the Components of Integration Expense (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Business Acquisition [Line Items]
 
 
 
 
Acquisition and integration related costs
$ 14.2 
$ 7.3 
$ 28.1 
$ 19.6 
UWW Holdings, Inc. XPEDX Merger
 
 
 
 
Business Acquisition [Line Items]
 
 
 
 
Integration management
3.8 
2.2 
10.5 
6.0 
Retention compensation
0.4 
0.2 
2.4 
Information technology conversion costs
2.8 
1.9 
6.8 
4.3 
Rebranding
0.1 
0.9 
0.4 
2.1 
Legal, consulting and other professional fees
0.4 
0.8 
1.3 
1.8 
Other
0.6 
1.1 
2.4 
3.0 
All American Containers
 
 
 
 
Business Acquisition [Line Items]
 
 
 
 
Acquisition and integration related costs
$ 6.5 
$ 0 
$ 6.5 
$ 0 
Acquisition Integration and Restructuring Charges - Summary of the Company's Restructuring Activity (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Veritiv Restructuring Plan
Sep. 30, 2016
Veritiv Restructuring Plan
Sep. 30, 2017
Veritiv Restructuring Plan
Sep. 30, 2016
Veritiv Restructuring Plan
Sep. 30, 2016
Severance and Related Costs
Sep. 30, 2017
Severance and Related Costs
Veritiv Restructuring Plan
Jun. 30, 2017
Severance and Related Costs
Veritiv Restructuring Plan
Mar. 31, 2017
Severance and Related Costs
Veritiv Restructuring Plan
Jun. 30, 2016
Severance and Related Costs
Veritiv Restructuring Plan
Mar. 31, 2016
Severance and Related Costs
Veritiv Restructuring Plan
Sep. 30, 2017
Severance and Related Costs
Veritiv Restructuring Plan
Sep. 30, 2016
Other Direct Costs
Sep. 30, 2017
Other Direct Costs
Veritiv Restructuring Plan
Jun. 30, 2017
Other Direct Costs
Veritiv Restructuring Plan
Mar. 31, 2017
Other Direct Costs
Veritiv Restructuring Plan
Jun. 30, 2016
Other Direct Costs
Veritiv Restructuring Plan
Mar. 31, 2016
Other Direct Costs
Veritiv Restructuring Plan
Sep. 30, 2017
Restructuring Costs, Excluding Non-Cash Items
Veritiv Restructuring Plan
Jun. 30, 2017
Restructuring Costs, Excluding Non-Cash Items
Veritiv Restructuring Plan
Mar. 31, 2017
Restructuring Costs, Excluding Non-Cash Items
Veritiv Restructuring Plan
Sep. 30, 2016
Restructuring Costs, Excluding Non-Cash Items
Veritiv Restructuring Plan
Jun. 30, 2016
Restructuring Costs, Excluding Non-Cash Items
Veritiv Restructuring Plan
Mar. 31, 2016
Restructuring Costs, Excluding Non-Cash Items
Veritiv Restructuring Plan
Restructuring Reserve [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Restructuring reserve, beginning balance
 
 
 
 
 
 
 
 
 
$ 3.9 
$ 2.0 
$ 1.8 
$ 1.5 
$ 1.7 
$ 1.8 
 
$ 22.6 
$ 8.3 
$ 8.0 
$ 0.3 
$ 0.4 
$ 26.5 
$ 10.3 
$ 9.8 
$ 2.6 
$ 1.8 
$ 2.1 
Costs incurred
2.7 
5.8 
30.0 
7.2 
2.7 
5.8 
30.0 
7.2 
0.3 
0.7 
3.9 
1.4 
0.9 
0.7 
4.1 
5.4 
3.8 
19.7 
3.1 
1.5 
0.3 
4.5 
23.6 
4.5 
5.7 
2.4 
1.0 
Payments
 
 
 
 
 
 
 
 
(1.0)
(0.7)
(2.0)
(1.2)
(0.6)
(0.9)
 
(0.7)
(4.7)
(5.4)
(2.8)
(1.0)
(0.4)
(5.4)
(7.4)
(4.0)
(1.7)
(1.6)
(1.3)
Restructuring reserve, ending balance
 
 
 
 
 
 
 
 
$ 1.1 
$ 3.9 
$ 3.9 
$ 2.0 
$ 1.8 
$ 1.5 
$ 3.9 
$ 5.5 
$ 21.7 
$ 22.6 
$ 8.3 
$ 0.8 
$ 0.3 
$ 25.6 
$ 26.5 
$ 10.3 
$ 6.6 
$ 2.6 
$ 1.8 
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets - Narrative (Details) (USD $)
In Millions, unless otherwise specified
0 Months Ended 3 Months Ended
Sep. 30, 2017
Dec. 31, 2016
Aug. 31, 2017
All American Containers
Aug. 31, 2017
All American Containers
Packaging
Sep. 30, 2017
Customer relationships
Goodwill [Line Items]
 
 
 
 
 
Goodwill
$ 105.3 
$ 50.2 
 
 
 
Goodwill expected to be deductible for taxes
 
 
61.2 
 
 
Allocation of goodwill acquired during period
 
 
 
100.00% 
 
Other intangible assets
 
 
51.2 
 
 
Intangible asset impairment
 
 
 
 
$ 1.6 
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets - Schedule of Changes in Goodwill (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2017
Dec. 31, 2016
Goodwill [Roll Forward]
 
 
Goodwill
$ 111.4 
$ 50.2 
Accumulated impairment losses
(6.1)
Goodwill acquired
61.2 
 
Impairment of goodwill
(6.1)
 
Net goodwill
105.3 
50.2 
Corporate & Other
 
 
Goodwill [Roll Forward]
 
 
Goodwill
6.1 
6.1 
Accumulated impairment losses
(6.1)
Goodwill acquired
 
Impairment of goodwill
(6.1)
 
Net goodwill
6.1 
Operating Segments |
Packaging
 
 
Goodwill [Roll Forward]
 
 
Goodwill
105.3 
44.1 
Accumulated impairment losses
Goodwill acquired
61.2 
 
Impairment of goodwill
 
Net goodwill
$ 105.3 
$ 44.1 
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets - Schedule of Other Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
0 Months Ended 0 Months Ended 0 Months Ended
Sep. 30, 2017
Dec. 31, 2016
Sep. 30, 2017
Customer relationships
Dec. 31, 2016
Customer relationships
Sep. 30, 2017
Trademarks/Trade names
Dec. 31, 2016
Trademarks/Trade names
Sep. 30, 2017
Non-compete agreements
Dec. 31, 2016
Non-compete agreements
Aug. 31, 2017
All American Containers
Aug. 31, 2017
All American Containers
Customer relationships
Aug. 31, 2017
All American Containers
Customer relationships
Aug. 31, 2017
All American Containers
Trademarks/Trade names
Aug. 31, 2017
All American Containers
Trademarks/Trade names
Aug. 31, 2017
All American Containers
Non-compete agreements
Aug. 31, 2017
All American Containers
Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross Carrying Amount
$ 75.3 
$ 26.3 
$ 64.9 
$ 23.6 
$ 7.8 
$ 2.7 
$ 2.6 
$ 0 
$ 51.2 
 
$ 43.5 
 
$ 5.1 
 
$ 2.6 
Accumulated Amortization
7.0 
5.3 
5.0 
4.0 
1.9 
1.3 
0.1 
 
 
 
 
 
 
 
Other intangibles, net
$ 68.3 
$ 21.0 
$ 59.9 
$ 19.6 
$ 5.9 
$ 1.4 
$ 2.5 
$ 0 
 
 
 
 
 
 
 
Estimated useful life
 
 
 
 
 
 
 
 
 
10 years 
 
5 years 
 
2 years 
 
Goodwill and Other Intangible Assets Goodwill and Other Intangible Assets - Schedule of Acquired Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Sep. 30, 2017
Customer relationships
Dec. 31, 2016
Customer relationships
Sep. 30, 2017
Trademarks/Trade names
Dec. 31, 2016
Trademarks/Trade names
Sep. 30, 2017
Non-compete agreements
Dec. 31, 2016
Non-compete agreements
Aug. 31, 2017
All American Containers
Aug. 31, 2017
All American Containers
Customer relationships
Aug. 31, 2017
All American Containers
Trademarks/Trade names
Aug. 31, 2017
All American Containers
Non-compete agreements
Finite-Lived Intangible Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Gross Carrying Amount
$ 75.3 
$ 26.3 
$ 64.9 
$ 23.6 
$ 7.8 
$ 2.7 
$ 2.6 
$ 0 
$ 51.2 
$ 43.5 
$ 5.1 
$ 2.6 
Debt And Other Obligations - Long-Term Debt Obligations (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Debt Instrument [Line Items]
 
 
Equipment capital lease and other obligations
$ 4.5 
$ 25.2 
Total debt
973.8 
752.1 
Less: current maturities of long-term debt
(1.8)
(2.9)
Long-term debt, net of current maturities
972.0 
749.2 
Line of Credit |
Asset-Based Lending Facility
 
 
Debt Instrument [Line Items]
 
 
Asset-Based Lending Facility (the ABL Facility)
$ 969.3 
$ 726.9 
Debt And Other Obligations - Narrative (Details) (USD $)
In Millions, unless otherwise specified
1 Months Ended 3 Months Ended 9 Months Ended 39 Months Ended
May 31, 2017
renewal
Sep. 30, 2017
Dec. 31, 2016
Dec. 31, 2016
Toronto Build-to-Suit Arrangement
Sep. 30, 2017
Line of Credit
Asset-Based Lending Facility
Sep. 30, 2017
Georgia-Pacific
UWW Holdings Inc
Sep. 30, 2017
Georgia-Pacific
UWW Holdings Inc
Property
Sep. 30, 2017
Georgia-Pacific
UWW Holdings Inc
Property
Sep. 30, 2017
Unisource
Georgia-Pacific
Line of Credit Facility [Line Items]
 
 
 
 
 
 
 
 
 
Remaining borrowing capacity
 
 
 
 
$ 272.3 
 
 
 
 
Capital lease obligations
 
4.5 
25.2 
19.1 
 
 
 
 
 
Subleases agreements, number of properties exited
 
 
 
 
 
 
11 
 
Non-cash derecognition of property plant and equipment
 
 
 
 
 
5.3 
14.6 
 
 
Non-cash derecognition of other financing obligations
 
 
 
 
 
5.6 
15.2 
 
 
Financing obligation at end of lease term
 
 
 
 
 
 
 
 
155.2 
Lease back contractual term
10 years 
 
 
 
 
 
 
 
 
Lease back optional renewal
 
 
 
 
 
 
 
 
Lease back optional renewal term
5 years 
 
 
 
 
 
 
 
 
Net proceeds from leaseback sale of facility
9.1 
 
 
 
 
 
 
 
 
Deferred gain related to leaseback sale of facility
$ 5.4 
 
 
 
 
 
 
 
 
Income Taxes - Provision for Income Taxes and the Effective Tax Rates (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Income Tax Disclosure [Abstract]
 
 
 
 
Income (loss) before income taxes
$ (18.3)
$ 13.6 
$ (38.7)
$ 35.2 
Income tax expense (benefit)
$ (4.0)
$ 8.0 
$ (13.1)
$ 18.4 
Effective tax rate
21.90% 
58.80% 
33.90% 
52.30% 
Income Taxes - Narrative (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Tax Credit Carryforward [Line Items]
 
 
 
 
Federal statutory income tax rate
35.00% 
35.00% 
35.00% 
35.00% 
Income tax benefit from credit
$ (4.0)
$ 8.0 
$ (13.1)
$ 18.4 
Foreign Taxes, Research And Experimentation Activities
 
 
 
 
Tax Credit Carryforward [Line Items]
 
 
 
 
Income tax benefit from credit
 
 
$ 3.1 
 
Related Party Transactions - Narrative (Details) (USD $)
In Millions, unless otherwise specified
0 Months Ended 9 Months Ended 1 Months Ended 0 Months Ended
Mar. 22, 2017
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
UWW Holdings, LLC
Jan. 31, 2017
UWW Holdings, LLC
Tax Receivable Agreement
Apr. 30, 2016
Georgia-Pacific
Settlement of Financing Obligation
Mar. 22, 2017
Block Trade
UWW Holdings, LLC
Related Party Transaction [Line Items]
 
 
 
 
 
 
 
Shares sold by existing shareholders (in shares)
 
 
 
 
 
 
1.8 
Transaction-related fees
$ 0.2 
 
 
 
 
 
 
Percentage of Veritiv outstanding common stock owned
 
 
 
27.30% 
 
 
 
Payments to UWWF for utilization of pre-merger net operating losses in federal and state tax returns
 
 
 
 
8.7 
 
 
Payments under Tax Receivable Agreement
 
8.5 
 
8.5 
 
 
Purchase of facility from related party
 
 
 
 
 
5.4 
 
Loss on settlement of financing obligations
 
 
 
 
 
$ 1.3 
 
Defined Benefit Plans - Net Periodic Benefit Costs and Credits (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
U.S.
 
 
 
 
Components of net periodic benefit cost (credit):
 
 
 
 
Service cost
$ 0.5 
$ 0.4 
$ 1.5 
$ 1.3 
Interest cost
0.6 
0.7 
2.0 
2.5 
Expected return on plan assets
(1.2)
(1.2)
(3.8)
(3.8)
Amortization of net loss
0.1 
0.1 
0.1 
Net periodic benefit cost (credit)
(0.1)
(0.2)
0.1 
Canada
 
 
 
 
Components of net periodic benefit cost (credit):
 
 
 
 
Service cost
0.1 
0.2 
0.2 
Interest cost
0.8 
0.8 
2.1 
2.4 
Expected return on plan assets
(1.0)
(0.9)
(2.8)
(2.7)
Amortization of net loss
0.1 
0.1 
Net periodic benefit cost (credit)
$ (0.2)
$ 0 
$ (0.4)
$ 0 
Fair Value Measurements - Narrative (Details) (USD $)
In Millions, unless otherwise specified
9 Months Ended 0 Months Ended 3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Jul. 1, 2014
UWW Holdings, Inc. XPEDX Merger
Sep. 30, 2017
Fair Value, Measurements, Nonrecurring
Sep. 30, 2016
Fair Value, Measurements, Nonrecurring
Sep. 30, 2017
Fair Value, Measurements, Nonrecurring
Sep. 30, 2016
Fair Value, Measurements, Nonrecurring
Sep. 30, 2017
Fair Value, Measurements, Recurring
Level 3
Contingent Liability
UWW Holdings, Inc. XPEDX Merger
Sep. 30, 2017
Earn Out Payment
All American Containers
Sep. 30, 2016
Earn Out Payment
All American Containers
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
 
 
Asset impairment charges
$ 8.4 
$ 4.0 
 
$ 7.7 
$ 3.1 
$ 8.4 
$ 4.0 
 
 
 
Fair value of contingent liability associated with the Tax Receivable Agreement
 
 
59.4 
 
 
 
 
 
 
 
Fair value discount rate
 
 
 
 
 
 
 
4.30% 
8.30% 
 
Contingent liability, earn-out amount
 
 
 
 
 
 
 
 
 
30.0 
Contingent liability, earn-out payment hight range
 
 
 
 
 
 
 
 
 
$ 50.0 
Fair Value Measurements - Liabilities Disclosed at Fair Value (Details) (Fair Value, Measurements, Recurring, USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
ABL Facility |
Asset-Backed Lending Facility |
Line of Credit
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Liabilities disclosed at fair value
$ 969.3 
$ 726.9 
ABL Facility |
Asset-Backed Lending Facility |
Line of Credit |
Level 2
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Liabilities disclosed at fair value
969.3 
726.9 
Tax Receivable Agreement |
UWW Holdings, Inc. XPEDX Merger
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Liabilities disclosed at fair value
61.0 
67.9 
Tax Receivable Agreement |
UWW Holdings, Inc. XPEDX Merger |
Level 3
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Liabilities disclosed at fair value
61.0 
67.9 
Contingent Earnout Liability |
All American Containers
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Liabilities disclosed at fair value
30.0 
 
Contingent Earnout Liability |
All American Containers |
Level 3
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Liabilities disclosed at fair value
$ 30.0 
 
Fair Value Measurements - Reconciliation of the Contingent Liability (Details) (Contingent Liability, UWW Holdings, Inc. XPEDX Merger, Fair Value, Measurements, Recurring, Level 3, USD $)
In Millions, unless otherwise specified
3 Months Ended
Sep. 30, 2017
Jun. 30, 2017
Mar. 31, 2017
Sep. 30, 2016
Jun. 30, 2016
Mar. 31, 2016
Contingent Liability |
UWW Holdings, Inc. XPEDX Merger |
Fair Value, Measurements, Recurring |
Level 3
 
 
 
 
 
 
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
 
 
 
 
 
 
Beginning balance
$ 61.4 
$ 60.3 
$ 67.9 
$ 66.8 
$ 64.8 
$ 63.0 
Change in fair value adjustment recorded in other expense (income), net
(0.4)
1.1 
0.9 
1.0 
2.0 
1.8 
Principal payment
 
 
(8.5)
 
 
 
Ending balance
$ 61.0 
$ 61.4 
$ 60.3 
$ 67.8 
$ 66.8 
$ 64.8 
Earnings (Loss) Per Share - Summary of the Numerators and Denominators Used in the Basic and Diluted Earnings Per Share Calculation (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Numerator:
 
 
 
 
Net income (loss)
$ (14.3)
$ 5.6 
$ (25.6)
$ 16.8 
Denominator:
 
 
 
 
Weighted average number of shares outstanding – basic (in shares)
15.70 
16.00 
15.70 
16.00 
Dilutive effect of stock-based awards (in shares)
0.27 
0.05 
Weighted average number of shares outstanding – diluted (in shares)
15.70 
16.27 
15.70 
16.05 
Earnings (loss) per share:
 
 
 
 
Earnings (loss) per share - basic (in dollars per share)
$ (0.91)
$ 0.35 
$ (1.63)
$ 1.05 
Earnings (loss) per share - diluted ( in dollars per share)
$ (0.91)
$ 0.34 
$ (1.63)
$ 1.04 
Antidilutive stock-based awards excluded from computation of diluted earnings per share (EPS) (in shares)
0.68 
0.66 
0.20 
Performance stock-based awards excluded from computation of diluted EPS because performance conditions had not been met (in shares)
0.48 
0.33 
0.48 
0.33 
Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Sep. 30, 2017
Dec. 31, 2016
Sep. 30, 2017
Foreign currency translation adjustments
Jun. 30, 2017
Foreign currency translation adjustments
Mar. 31, 2017
Foreign currency translation adjustments
Sep. 30, 2016
Foreign currency translation adjustments
Jun. 30, 2016
Foreign currency translation adjustments
Mar. 31, 2016
Foreign currency translation adjustments
Sep. 30, 2017
Retirement liabilities
Jun. 30, 2017
Retirement liabilities
Mar. 31, 2017
Retirement liabilities
Sep. 30, 2016
Retirement liabilities
Jun. 30, 2016
Retirement liabilities
Mar. 31, 2016
Retirement liabilities
Sep. 30, 2017
Interest rate swap
Jun. 30, 2017
Interest rate swap
Mar. 31, 2017
Interest rate swap
Sep. 30, 2016
Interest rate swap
Jun. 30, 2016
Interest rate swap
Mar. 31, 2016
Interest rate swap
Sep. 30, 2017
AOCL
Jun. 30, 2017
AOCL
Mar. 31, 2017
AOCL
Sep. 30, 2016
AOCL
Jun. 30, 2016
AOCL
Mar. 31, 2016
AOCL
AOCI Attributable to Parent, Net of Tax [Roll Forward]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Beginning balance
$ 535.7 
$ 541.8 
$ (23.8)
$ (26.4)
$ (29.2)
$ (24.9)
$ (23.3)
$ (27.1)
$ (9.0)
$ (9.0)
$ (9.1)
$ (7.2)
$ (7.3)
$ (7.4)
$ (0.8)
$ (0.8)
$ (0.7)
$ (0.8)
$ (0.8)
$ (0.5)
$ (33.6)
$ (36.2)
$ (39.0)
$ (32.9)
$ (31.4)
$ (35.0)
Unrealized net gains (losses) arising during the period
 
 
2.4 
2.6 
2.8 
(1.6)
(1.6)
3.8 
0.1 
(0.1)
(0.3)
2.4 
2.6 
2.8 
(1.6)
(1.6)
3.5 
Amounts reclassified from AOCL
 
 
 
 
 
 
 
 
0.1 
0.1 
0.1 
 
 
 
0.1 
 
 
 
0.1 
0.1 
Net current period other comprehensive income (loss)
 
 
2.4 
2.6 
2.8 
(1.6)
(1.6)
3.8 
0.1 
0.1 
0.1 
0.1 
(0.1)
(0.3)
2.5 
2.6 
2.8 
(1.6)
(1.5)
3.6 
Ending balance
$ 535.7 
$ 541.8 
$ (21.4)
$ (23.8)
$ (26.4)
$ (26.5)
$ (24.9)
$ (23.3)
$ (9.0)
$ (9.0)
$ (9.0)
$ (7.2)
$ (7.2)
$ (7.3)
$ (0.7)
$ (0.8)
$ (0.8)
$ (0.8)
$ (0.8)
$ (0.8)
$ (31.1)
$ (33.6)
$ (36.2)
$ (34.5)
$ (32.9)
$ (31.4)
Commitments and Contingencies - Narrative (Details) (USD $)
In Millions, unless otherwise specified
1 Months Ended 9 Months Ended
Jun. 30, 2017
installemnt
Sep. 30, 2017
state
Loss Contingencies [Line Items]
 
 
Additional states joining escheat audit
 
Loss contingency
 
$ 10.9 
Monthly installments payments
240 
 
Minimum
 
 
Loss Contingencies [Line Items]
 
 
Escheat audit period
 
4 years 
Segment Information - Narrative (Details)
9 Months Ended
Sep. 30, 2017
segment
Segment Reporting [Abstract]
 
Number of reportable segments
Segment Information - Segment Reporting Information, by Segment (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
$ 2,116.8 
$ 2,126.6 
$ 6,140.3 
$ 6,207.2 
Adjusted EBITDA
   
   
   
   
Depreciation and amortization
13.1 
13.4 
39.9 
40.5 
Restructuring charges
2.7 
5.8 
30.0 
7.2 
Operating Segments
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
2,079.5 
2,095.4 
6,033.2 
6,120.2 
Adjusted EBITDA
91.0 
99.1 
254.2 
271.8 
Depreciation and amortization
8.5 
8.5 
24.2 
25.8 
Restructuring charges
13.6 
5.8 
29.7 
7.0 
Corporate & Other
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
37.3 
31.2 
107.1 
87.0 
Adjusted EBITDA
(46.9)
(42.0)
(137.8)
(129.7)
Depreciation and amortization
4.6 
4.9 
15.7 
14.7 
Restructuring charges
(10.9)
0.3 
0.2 
Packaging |
Operating Segments
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
799.6 
730.1 
2,266.0 
2,106.4 
Adjusted EBITDA
62.1 
59.5 
166.7 
165.4 
Depreciation and amortization
4.0 
3.1 
10.5 
9.3 
Restructuring charges
5.8 
2.2 
12.3 
2.6 
Facility Solutions |
Operating Segments
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
339.6 
328.7 
975.5 
951.6 
Adjusted EBITDA
10.3 
13.0 
25.1 
34.3 
Depreciation and amortization
1.6 
1.5 
4.5 
4.5 
Restructuring charges
1.9 
1.0 
5.2 
1.5 
Print |
Operating Segments
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
701.6 
788.2 
2,095.1 
2,299.0 
Adjusted EBITDA
13.1 
20.0 
44.8 
55.7 
Depreciation and amortization
2.7 
3.1 
7.9 
9.5 
Restructuring charges
5.9 
2.6 
12.2 
2.9 
Publishing |
Operating Segments
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Net sales
238.7 
248.4 
696.6 
763.2 
Adjusted EBITDA
5.5 
6.6 
17.6 
16.4 
Depreciation and amortization
0.2 
0.8 
1.3 
2.5 
Restructuring charges
$ 0 
$ 0 
$ 0 
$ 0 
Segment Information - Reconciliation of Income Before Income Taxes to Total Adjusted EBITDA (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2017
Sep. 30, 2016
Sep. 30, 2017
Sep. 30, 2016
Segment Reporting Information [Line Items]
 
 
 
 
Income (loss) before income taxes
$ (18.3)
$ 13.6 
$ (38.7)
$ 35.2 
Interest expense, net
8.3 
8.2 
22.1 
21.1 
Depreciation and amortization
13.1 
13.4 
39.9 
40.5 
Restructuring charges
2.7 
5.8 
30.0 
7.2 
Stock-based compensation
3.8 
2.1 
11.6 
7.2 
LIFO reserve increase (decrease)
3.7 
0.4 
3.4 
(2.7)
Non-restructuring asset impairment charges
7.7 
3.1 
8.4 
4.0 
Non-restructuring severance charges
0.5 
0.2 
1.5 
2.4 
Non-restructuring pension charges
3.2 
2.3 
2.1 
2.3 
Acquisition and integration expenses
14.2 
7.3 
28.1 
19.6 
Fair value adjustments on TRA contingent liability
(0.4)
1.0 
1.6 
4.8 
Other
5.6 
(0.3)
6.4 
0.5 
Adjusted EBITDA
   
   
   
   
Corporate & Other
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Depreciation and amortization
4.6 
4.9 
15.7 
14.7 
Restructuring charges
(10.9)
0.3 
0.2 
Adjusted EBITDA
(46.9)
(42.0)
(137.8)
(129.7)
Operating Segments
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
Depreciation and amortization
8.5 
8.5 
24.2 
25.8 
Restructuring charges
13.6 
5.8 
29.7 
7.0 
Adjusted EBITDA
$ 91.0 
$ 99.1 
$ 254.2 
$ 271.8 
Segment Information - Summary of Assets (Details) (USD $)
In Millions, unless otherwise specified
Sep. 30, 2017
Dec. 31, 2016
Segment Reporting Information [Line Items]
 
 
Assets
$ 2,775.1 
$ 2,483.7 
Operating Segments |
Packaging
 
 
Segment Reporting Information [Line Items]
 
 
Assets
1,137.3 
875.9 
Operating Segments |
Facility Solutions
 
 
Segment Reporting Information [Line Items]
 
 
Assets
424.1 
397.9 
Operating Segments |
Print
 
 
Segment Reporting Information [Line Items]
 
 
Assets
883.6 
874.1 
Operating Segments |
Publishing
 
 
Segment Reporting Information [Line Items]
 
 
Assets
178.3 
170.0 
Corporate & Other
 
 
Segment Reporting Information [Line Items]
 
 
Assets
$ 151.8 
$ 165.8