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Year Ended December 31, | |||||||
(in millions) | 2017 | 2016 | |||||
Allowance for doubtful accounts | $ | 32.4 | $ | 23.7 | |||
Other allowances | 11.6 | 10.8 | |||||
Total accounts receivable allowances | $ | 44.0 | $ | 34.5 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Beginning balance, January 1 | $ | 34.5 | $ | 33.3 | $ | 39.0 | |||||
Add / (Deduct): | |||||||||||
Provision for bad debt expense | 15.9 | 2.2 | 7.4 | ||||||||
Net write-offs and recoveries | (7.7 | ) | (6.7 | ) | (13.1 | ) | |||||
Other adjustments(1) | 1.3 | 5.7 | — | ||||||||
Ending balance, December 31 | $ | 44.0 | $ | 34.5 | $ | 33.3 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Land, buildings and improvements | $ | 106.6 | $ | 132.0 | |||
Machinery and equipment | 145.3 | 131.1 | |||||
Equipment capital leases and assets related to financing obligations (including financing obligations with related party) | 233.3 | 215.5 | |||||
Internal use software | 159.2 | 151.0 | |||||
Construction-in-progress | 10.4 | 35.0 | |||||
Less: Accumulated depreciation and software amortization | (314.6 | ) | (292.8 | ) | |||
Property and equipment, net | $ | 340.2 | $ | 371.8 |
Buildings | 40 years |
Leasehold improvements | 1 to 20 years |
Machinery and equipment | 3 to 15 years |
Equipment capital leases and assets related to financing obligations (including financing obligations with related party) | 3 to 15 years |
Internal use software | 3 to 5 years |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Depreciation expense (1) | $ | 33.5 | $ | 33.8 | $ | 32.6 | |||||
Amortization expense - internal use software | 16.5 | 17.5 | 18.4 | ||||||||
Depreciation and amortization expense related to property and equipment | $ | 50.0 | $ | 51.3 | $ | 51.0 | |||||
Accumulated depreciation on equipment capital leases and assets related to financing obligations (including financing obligations with related party) | $ | 35.6 | $ | 29.7 | |||||||
Unamortized internal use software costs, including amounts recorded in CIP | $ | 37.6 | $ | 43.9 |
Level 1 – | Quoted market prices in active markets for identical assets or liabilities. |
Level 2 – | Observable market-based inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. |
Level 3 – | Unobservable inputs for the asset or liability reflecting the reporting entity’s own assumptions or external inputs from inactive markets. |
Recently Issued Accounting Standards Not Yet Adopted | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
Accounting Standards Update ("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. A proposed ASU has been issued that would add the option for organizations to not provide comparative period financial statements and instead apply the transition requirements as of 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 substantially all operating leases on the balance sheet as a lease obligation and right of use asset. 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. The Company currently does not anticipate making a policy election to use hindsight to determine lease term. 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 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220) | The standard allows companies to reclassify the effect of the change in tax laws and rates on deferred tax assets and liabilities as part of the Tax Act from accumulated other comprehensive income (loss) to retained earnings. The guidance is to be applied to each period in which the effect of the Tax Act (or portion thereof) is recorded and companies may apply it either (1) retrospectively as of the date of enactment or (2) as of the beginning of the period of adoption. | January 1, 2019; early adoption is permitted. | The Company is currently evaluating early adoption and the impact this ASU will have on its Consolidated Financial Statements and related disclosures. |
Recently Adopted Accounting Standards | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
ASU 2014-09, Revenue from Contracts with Customers (Topic 606) | The standard replaces previous revenue recognition standards and significantly expands 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 adopted this ASU on January 1, 2018 applying the modified retrospective method. Focus areas were customer rebates, accounting for customer dedicated inventory and principal/agent considerations. The adoption did not materially impact the Company's Financial Statements and is not expected to have a material impact on future financial results as the adoption did not change the recognition pattern for the Company's existing revenue streams. The Company implemented new internal controls related to contract reviews and revenue recognition disclosures. Additional disclosures will be made as needed in future reports as a result of the adoption in 2018. | |||
Recently Adopted Accounting Standards (continued) | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
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 adopted this ASU on January 1, 2018. The adoption did not materially impact the Company's historical Consolidated Financial Statements or related disclosures. Impacts to future results and disclosures will be dependent upon the presence of any items noted in the standard. | |||
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 adopted 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 adopted this ASU on January 1, 2018. The adoption did not materially impact its historical Consolidated Financial Statements or related disclosures. | |||
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 will not apply to inventories measured by either the last-in first-out 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. For the years ended December 31, 2017 and 2016, approximately 86% and 87% of the inventory balances were measured using LIFO, respectively. |
Recently Adopted Accounting Standards (continued) | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
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. Impacts to future results and disclosures will be dependent upon the presence of any items noted in the standard. |
|
(in millions) | |||
Cash consideration | $ | 112.0 | |
Loan pay-off | 34.3 | ||
Contingent consideration | 22.2 | ||
Other | 1.3 | ||
Total preliminary estimated purchase price | $ | 169.8 |
(in millions) | |||
Cash | $ | 1.5 | |
Accounts receivable | 30.4 | ||
Inventories | 38.5 | ||
Other current assets | 5.7 | ||
Property and equipment | 3.5 | ||
Goodwill | 55.5 | ||
Other intangible assets | 49.0 | ||
Other non-current assets | 1.4 | ||
Accounts payable | (12.4 | ) | |
Other current liabilities | (2.7 | ) | |
Other non-current liabilities | (0.6 | ) | |
Total preliminary estimated purchase price | $ | 169.8 |
(Unaudited) | Year Ended December 31, | ||||||
(in millions, except share and per share data) | 2017 | 2016 | |||||
Net sales | $ | 8,527.6 | $ | 8,548.2 | |||
Net income (loss) | (7.2 | ) | 14.1 | ||||
Earnings (loss) per share: | |||||||
Basic earnings (loss) per share | $ | (0.46 | ) | $ | 0.88 | ||
Diluted earnings (loss) per share | $ | (0.46 | ) | $ | 0.87 | ||
Weighted-average shares outstanding | |||||||
Basic | 15.70 | 15.97 | |||||
Diluted | 15.70 | 16.15 |
|
Year Ended December 31, | ||||||||||||
(in millions) | 2017 | 2016 | 2015 | |||||||||
Integration management | $ | 14.5 | $ | 8.3 | $ | — | ||||||
Retention compensation | 0.2 | 2.5 | 10.8 | |||||||||
Information technology conversion costs | 8.8 | 6.3 | 7.4 | |||||||||
Rebranding | 0.5 | 2.4 | 6.1 | |||||||||
Legal, consulting and other professional fees | 1.5 | 2.3 | 7.8 | |||||||||
Other | 3.0 | 4.1 | 2.8 | |||||||||
AAC acquisition and integration | 8.0 | — | — | |||||||||
Total acquisition and integration expenses | $ | 36.5 | $ | 25.9 | $ | 34.9 |
(in millions) | Severance and Related Costs | Other Direct Costs | Gain on Sale of Assets and Other | Total | |||||||||||
2017 | $ | 7.5 | $ | 33.6 | $ | (24.4 | ) | $ | 16.7 | ||||||
2016 | 3.5 | 11.0 | (2.1 | ) | 12.4 | ||||||||||
2015 | 4.3 | 2.9 | 4.1 | 11.3 | |||||||||||
Cumulative | 20.0 | 47.9 | (22.4 | ) | 45.5 |
(in millions) | Severance and Related Costs | Other Direct Costs | Total | ||||||||
Balance at December 31, 2015 | $ | 1.7 | $ | 0.4 | $ | 2.1 | |||||
Costs incurred | 3.5 | 11.0 | 14.5 | ||||||||
Payments | (3.4 | ) | (3.4 | ) | (6.8 | ) | |||||
Balance at December 31, 2016 | 1.8 | 8.0 | 9.8 | ||||||||
Costs incurred | 7.5 | 33.6 | 41.1 | ||||||||
Payments | (4.9 | ) | (16.4 | ) | (21.3 | ) | |||||
Balance at December 31, 2017 | $ | 4.4 | $ | 25.2 | $ | 29.6 |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 |
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(in millions) | Packaging | Facility Solutions | Print | Publishing | Corporate & Other | Total | |||||||||||||||||
Balance at December 31, 2015: | |||||||||||||||||||||||
Goodwill | $ | 44.1 | $ | 59.0 | $ | 265.4 | $ | 50.5 | $ | 6.1 | $ | 425.1 | |||||||||||
Accumulated impairment losses | — | (59.0 | ) | (265.4 | ) | (50.5 | ) | — | (374.9 | ) | |||||||||||||
Net goodwill 2015 | 44.1 | — | — | — | 6.1 | 50.2 | |||||||||||||||||
2016 Activity: | |||||||||||||||||||||||
Goodwill acquired | — | — | — | — | — | — | |||||||||||||||||
Impairment of goodwill | — | — | — | — | — | — | |||||||||||||||||
Balance at December 31, 2016: | |||||||||||||||||||||||
Goodwill | 44.1 | 59.0 | 265.4 | 50.5 | 6.1 | 425.1 | |||||||||||||||||
Accumulated impairment losses | — | (59.0 | ) | (265.4 | ) | (50.5 | ) | — | (374.9 | ) | |||||||||||||
Net goodwill 2016 | 44.1 | — | — | — | 6.1 | 50.2 | |||||||||||||||||
2017 Activity: | |||||||||||||||||||||||
Goodwill acquired | 55.5 | — | — | — | — | 55.5 | |||||||||||||||||
Impairment of goodwill | — | — | — | — | (6.1 | ) | (6.1 | ) | |||||||||||||||
Balance at December 31, 2017: | |||||||||||||||||||||||
Goodwill | 99.6 | 59.0 | 265.4 | 50.5 | 6.1 | 480.6 | |||||||||||||||||
Accumulated impairment losses | — | (59.0 | ) | (265.4 | ) | (50.5 | ) | (6.1 | ) | (381.0 | ) | ||||||||||||
Net goodwill 2017 | $ | 99.6 | $ | — | $ | — | $ | — | $ | — | $ | 99.6 |
December 31, 2017 | December 31, 2016 | ||||||||||||||||||||||
(in millions) | Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net | |||||||||||||||||
Customer relationships | $ | 67.7 | $ | 6.1 | $ | 61.6 | $ | 23.6 | $ | 4.0 | $ | 19.6 | |||||||||||
Trademarks/Trade names | 3.8 | 2.3 | 1.5 | 2.7 | 1.3 | 1.4 | |||||||||||||||||
Non-compete agreements | 1.5 | 0.5 | 1.0 | — | — | — | |||||||||||||||||
Total | $ | 73.0 | $ | 8.9 | $ | 64.1 | $ | 26.3 | $ | 5.3 | $ | 21.0 |
Gross Value (in millions) | Estimated Useful Life (in years) | ||||
Customer relationships | $ | 46.4 | 14.0 | ||
Trademarks/Trade names | 1.1 | 1.0 | |||
Non-compete agreements | 1.5 | 1.0 | |||
Total identifiable intangible assets acquired | $ | 49.0 |
Year | Total | |||
2018 | $ | 6.7 | ||
2019 | 4.8 | |||
2020 | 4.8 | |||
2021 | 4.8 | |||
2022 | 4.8 |
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(in millions) | December 31, 2017 | December 31, 2016 | |||||
Asset-Based Lending Facility (the "ABL Facility") | $ | 897.7 | $ | 726.9 | |||
Equipment capital lease and other obligations | 13.5 | 25.2 | |||||
Total debt | 911.2 | 752.1 | |||||
Less: current maturities of long-term debt | (2.9 | ) | (2.9 | ) | |||
Long-term debt, net of current maturities | $ | 908.3 | $ | 749.2 |
(in millions) | December 31, 2017 | December 31, 2016 | |||||
Obligations to related party | $ | 162.3 | $ | 191.0 | |||
Obligations - other financing | 27.1 | — | |||||
Total financing obligations | 189.4 | 191.0 | |||||
Less: current portion of financing obligations | (7.8 | ) | (14.9 | ) | |||
Financing obligations, less current portion | $ | 181.6 | $ | 176.1 |
Year Ended December 31, | |||||||||||
(in millions, except number of agreements) | 2017 | 2016 | Total | ||||||||
Property and equipment | $ | 14.6 | $ | 3.7 | $ | 18.3 | |||||
Financing obligations | 15.2 | 8.4 | 23.6 | ||||||||
Number of terminated property agreements | 8 | 3 | 11 |
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Financing Obligations and Equipment Capital Leases (1) | Operating Leases | ||||||||||||||
(in millions) | Lease Obligations | Sublease Income | Total | ||||||||||||
2018 | $ | 12.8 | $ | 94.3 | $ | (0.2 | ) | $ | 94.1 | ||||||
2019 | 5.0 | 80.3 | (0.2 | ) | 80.1 | ||||||||||
2020 | 4.6 | 70.4 | — | 70.4 | |||||||||||
2021 | 4.0 | 57.7 | — | 57.7 | |||||||||||
2022 | 3.8 | 45.8 | — | 45.8 | |||||||||||
Thereafter | 22.4 | 135.6 | — | 135.6 | |||||||||||
52.6 | 484.1 | (0.4 | ) | 483.7 | |||||||||||
Amount representing interest | (12.5 | ) | — | — | — | ||||||||||
Total future minimum lease payments | $ | 40.1 | $ | 484.1 | $ | (0.4 | ) | $ | 483.7 |
|
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Domestic (United States) | $ | (18.0 | ) | $ | 27.6 | $ | 46.6 | ||||
Foreign | 16.1 | 13.2 | (1.7 | ) | |||||||
Income (loss) before income taxes | $ | (1.9 | ) | $ | 40.8 | $ | 44.9 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Current Provision: | |||||||||||
U.S. Federal | $ | 4.8 | $ | 3.6 | $ | — | |||||
U.S. State | 1.5 | 1.5 | 1.7 | ||||||||
Foreign | 3.2 | 3.6 | 1.6 | ||||||||
Total current income tax expense | $ | 9.5 | $ | 8.7 | $ | 3.3 | |||||
Deferred, net: | |||||||||||
U.S. Federal | $ | 16.3 | $ | 9.6 | $ | 14.8 | |||||
U.S. State | (2.7 | ) | 1.9 | 0.5 | |||||||
Foreign | (11.7 | ) | (0.4 | ) | (0.4 | ) | |||||
Total deferred, net | $ | 1.9 | $ | 11.1 | $ | 14.9 | |||||
Provision for income tax expense (benefit) | $ | 11.4 | $ | 19.8 | $ | 18.2 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Income (loss) before income taxes | $ | (1.9 | ) | $ | 40.8 | $ | 44.9 | ||||
Statutory U.S. income tax rate | 35.0 | % | 35.0 | % | 35.0 | % | |||||
Tax expense using statutory U.S. income tax rate | $ | (0.7 | ) | $ | 14.3 | $ | 15.7 | ||||
Foreign income tax rate differential | (1.4 | ) | (1.1 | ) | 0.2 | ||||||
State tax (net of federal benefit) | (0.5 | ) | 2.8 | 1.6 | |||||||
Non-deductible expenses | 2.2 | 2.3 | 1.5 | ||||||||
Tax Receivable Agreement (a) | (3.8 | ) | 1.6 | 0.7 | |||||||
Tax credits (b) | (4.0 | ) | — | — | |||||||
Foreign exchange loss (c) | — | — | (1.2 | ) | |||||||
Impact of U.S. Tax Act (Federal and State) | 30.2 | — | — | ||||||||
Change in valuation allowance - U.S. Federal and State (d) | — | — | (0.8 | ) | |||||||
Change in valuation allowance - Foreign | (13.7 | ) | (0.5 | ) | 1.7 | ||||||
Goodwill impairment | 2.1 | — | 0.7 | ||||||||
Foreign taxes | 0.7 | 0.5 | 0.1 | ||||||||
Other (e) | 0.3 | (0.1 | ) | (2.0 | ) | ||||||
Income tax provision (benefit) | $ | 11.4 | $ | 19.8 | $ | 18.2 | |||||
Effective income tax rate | (600.0 | )% | 48.5 | % | 40.5 | % |
December 31, 2017 | December 31, 2016 | ||||||||||||||
(in millions) | U.S. | Non-U.S. | U.S. | Non-U.S. | |||||||||||
Deferred income tax assets: | |||||||||||||||
Accrued compensation | $ | 11.6 | $ | 0.2 | $ | 17.7 | $ | 0.1 | |||||||
Financing obligations to related party | 47.3 | 0.8 | 77.5 | 0.8 | |||||||||||
Goodwill and other intangibles, net | 1.9 | — | 4.6 | — | |||||||||||
Long-term compensation | 21.3 | 4.1 | 21.2 | 3.8 | |||||||||||
Net operating losses and credit carryforwards | 44.9 | 11.8 | 74.1 | 13.6 | |||||||||||
Allowance for doubtful accounts | 10.0 | 0.1 | 11.9 | — | |||||||||||
Other | 5.6 | 0.6 | 3.5 | 0.8 | |||||||||||
Gross deferred income tax assets | 142.6 | 17.6 | 210.5 | 19.1 | |||||||||||
Less valuation allowance | (4.7 | ) | (3.6 | ) | (6.5 | ) | (18.1 | ) | |||||||
Total deferred tax asset | 137.9 | 14.0 | 204.0 | 1.0 | |||||||||||
Deferred income tax liabilities: | |||||||||||||||
Property and equipment, net | (54.2 | ) | — | (86.7 | ) | — | |||||||||
Inventory reserve | (33.5 | ) | — | (48.2 | ) | — | |||||||||
Other | (4.6 | ) | — | (8.3 | ) | — | |||||||||
Total deferred tax liability | (92.3 | ) | — | (143.2 | ) | — | |||||||||
Net deferred income tax asset | $ | 45.6 | $ | 14.0 | $ | 60.8 | $ | 1.0 |
(in millions) | U.S. | Non-U.S. | Total | ||||||||
Balance at December 31, 2015 | $ | 6.3 | $ | 15.5 | $ | 21.8 | |||||
Additions | 0.2 | 3.4 | 3.6 | ||||||||
Subtractions | — | (0.9 | ) | (0.9 | ) | ||||||
Currency translation adjustments | — | 0.1 | 0.1 | ||||||||
Balance at December 31, 2016 | 6.5 | 18.1 | 24.6 | ||||||||
Additions | — | 0.2 | 0.2 | ||||||||
Subtractions (a) | (1.8 | ) | (16.0 | ) | (17.8 | ) | |||||
Currency translation adjustments | — | 1.3 | 1.3 | ||||||||
Balance at December 31, 2017 | $ | 4.7 | $ | 3.6 | $ | 8.3 |
|
• | Registration Rights Agreement: The Registration Rights Agreement provides the UWWH Stockholder with certain demand and piggyback registration rights. Under this Agreement, the UWWH Stockholder is also entitled to transfer its Veritiv common stock to one or more of its affiliates or equity-holders and may exercise registration rights on behalf of such transferees if such transferees become a party to the Registration Rights Agreement. The UWWH Stockholder, on behalf of the holders of shares of Veritiv’s common stock that are party to the Registration Rights Agreement, under certain circumstances and provided certain thresholds described in the Registration Rights Agreement are met, may make a written request to the Company for the registration of the offer and sale of all or part of the shares subject to such registration rights. If the Company registers the offer and sale of its common stock (other than pursuant to a demand registration or in connection with registration on Form S-4 and Form S-8 or any successor or similar forms, or relating solely to the sale of debt or convertible debt instruments) either on its behalf or on the behalf of other security holders, the holders of the registration rights under the Registration Rights Agreement are entitled to include their shares in such registration. The demand rights described commenced 180 days after the Distribution Date. Veritiv is not required to effect more than one demand registration in any 150-day period or more than two demand registrations in any 365-day period. If Veritiv believes that a registration or an offering would materially affect a significant transaction or would require it to disclose confidential information which it in good faith believes would be adverse to its interest, then Veritiv may delay a registration or filing for no more than 120 days in a 360-day period. |
• | Tax Receivable Agreement: The Tax Receivable Agreement sets forth the terms by which Veritiv generally will be obligated to pay the UWWH Stockholder an amount equal to 85% of the U.S. federal, state and Canadian income tax savings that Veritiv actually realizes as a result of the utilization of Unisource's net operating losses attributable to taxable periods prior to the date of the Merger. For purposes of the Tax Receivable Agreement, Veritiv’s income tax savings will generally be computed by comparing Veritiv’s actual aggregate U.S. federal, state and Canadian income tax liability for taxable periods (or portions thereof) beginning after the date of the Merger to the amount of Veritiv’s aggregate U.S. federal, state and Canadian income tax liability for the same periods had Veritiv not been able to utilize Unisource's net operating losses attributable to taxable periods prior to the date of the Merger. Veritiv will pay to the UWWH Stockholder an amount equal to 85% of such tax savings, plus interest at a rate of LIBOR plus 1.00%, computed from the earlier of the date that Veritiv files its U.S. federal income tax return for the applicable taxable year and the date that such tax return is due (without extensions) until payments are made. Under the Tax Receivable Agreement, the UWWH Stockholder will not be required to reimburse Veritiv for any payments previously made if such tax benefits are subsequently disallowed or adjusted (although future payments under the Tax Receivable Agreement would be adjusted to the extent possible to reflect the result of such disallowance or adjustment). The Tax Receivable Agreement will be binding on and adapt to the benefit of any permitted assignees of the UWWH Stockholder and to any successors to any of the parties of the Tax Receivable Agreement to the same extent as if such permitted assignee or successor had been an original party to the Tax Receivable Agreement. In January 2018 and 2017, Veritiv paid $10.1 million and $8.7 million, respectively, in principal and interest, to the UWWH Stockholder for the utilization of pre-merger NOLs in its 2016 and 2015 federal and state tax returns, respectively. As of December 31, 2017, the Tax Receivable Agreement was revalued for the Tax Act change, lowering the U.S. federal corporate tax rate from 35% to 21%. This change reduced the value of the Tax Receivable Agreement liability by $13.5 million. |
Year Ended December 31, | ||||||||||||
(in millions) | 2017 | 2016 | 2015 | |||||||||
Sales to Georgia-Pacific, reflected in net sales | $ | 32.2 | $ | 35.6 | $ | 33.6 | ||||||
Purchases of inventory from Georgia-Pacific, recognized in cost of products sold | $ | 181.6 | $ | 224.9 | $ | 264.7 | ||||||
Inventories purchased from Georgia-Pacific that remained on Veritiv's balance sheet | $ | 22.7 | $ | 24.8 | ||||||||
Related party payable to Georgia-Pacific | $ | 8.5 | $ | 9.0 | ||||||||
Related party receivable from Georgia-Pacific | $ | 3.3 | $ | 3.9 |
|
Deferred Compensation Liability | ||||||||
(in millions) | December 31, 2017 | December 31, 2016 | ||||||
Other accrued liabilities | $ | 2.6 | $ | 2.7 | ||||
Other non-current liabilities | 23.7 | 21.6 | ||||||
Total liabilities | $ | 26.3 | $ | 24.3 |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | ||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||||||
Accumulated benefit obligation, end of year | $ | 91.0 | $ | 83.2 | $ | 89.7 | $ | 71.9 | |||||||
Change in projected benefit obligation: | |||||||||||||||
Benefit obligation, beginning of year | $ | 89.7 | $ | 79.0 | $ | 89.0 | $ | 76.0 | |||||||
Service cost | 0.8 | 0.3 | 0.7 | 0.3 | |||||||||||
Interest cost | 2.7 | 2.7 | 3.4 | 3.1 | |||||||||||
Actuarial (gain) loss | 3.3 | 6.1 | — | 2.2 | |||||||||||
Benefits paid | (5.5 | ) | (3.9 | ) | (3.4 | ) | (4.8 | ) | |||||||
Foreign exchange adjustments | — | 5.8 | — | 2.2 | |||||||||||
Projected benefit obligation, end of year | $ | 91.0 | $ | 90.0 | $ | 89.7 | $ | 79.0 | |||||||
Change in plan assets: | |||||||||||||||
Plan assets, beginning of year | $ | 75.9 | $ | 64.9 | $ | 74.4 | $ | 61.6 | |||||||
Employer contributions | — | 3.1 | — | 3.1 | |||||||||||
Investment returns | 12.0 | 6.0 | 5.9 | 3.1 | |||||||||||
Benefits paid | (5.5 | ) | (3.9 | ) | (3.4 | ) | (4.8 | ) | |||||||
Administrative expenses paid | (1.0 | ) | — | (1.0 | ) | — | |||||||||
Foreign exchange adjustments | — | 4.8 | — | 1.9 | |||||||||||
Plan assets, end of year | $ | 81.4 | $ | 74.9 | $ | 75.9 | $ | 64.9 | |||||||
Underfunded status, end of year | $ | (9.6 | ) | $ | (15.1 | ) | $ | (13.8 | ) | $ | (14.1 | ) |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | ||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||||||
Amounts recognized in the Consolidated Balance Sheets consist of: | |||||||||||||||
Other accrued liabilities | $ | 0.1 | $ | 0.2 | $ | 0.1 | $ | 0.2 | |||||||
Defined benefit pension obligations | 9.5 | 14.9 | 13.7 | 13.9 | |||||||||||
Net liability recognized | $ | 9.6 | $ | 15.1 | $ | 13.8 | $ | 14.1 |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | ||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||||||
Amounts not yet reflected in net periodic benefit cost and included in AOCL consist of: | |||||||||||||||
Net loss, net of tax | $ | 3.2 | $ | 6.1 | $ | 5.7 | $ | 3.4 |
Year Ended December 31, | |||||||||||||||||||||||
2017 | 2016 | 2015 | |||||||||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | U.S. | Canada | |||||||||||||||||
Components of net periodic benefit cost (credit): | |||||||||||||||||||||||
Service cost | $ | 2.0 | $ | 0.3 | $ | 1.7 | $ | 0.3 | $ | 1.6 | $ | 0.2 | |||||||||||
Interest cost | 2.7 | 2.7 | 3.4 | 3.1 | 3.2 | 3.2 | |||||||||||||||||
Expected return on plan assets | (5.1 | ) | (3.7 | ) | (5.0 | ) | (3.5 | ) | (5.2 | ) | (3.3 | ) | |||||||||||
Amortization of net loss | 0.1 | 0.2 | 0.1 | 0.2 | — | — | |||||||||||||||||
Net periodic benefit cost (credit) | $ | (0.3 | ) | $ | (0.5 | ) | $ | 0.2 | $ | 0.1 | $ | (0.4 | ) | $ | 0.1 | ||||||||
Changes to funded status recognized in other comprehensive (income) loss: | |||||||||||||||||||||||
Net loss (gain) during year, net of tax | $ | (2.5 | ) | $ | 2.7 | $ | (0.5 | ) | $ | 2.2 | $ | 1.0 | $ | (1.0 | ) |
As of December 31, 2017 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – U.S.: | |||||||||||||||
Equity securities | $ | 56.8 | $ | 56.8 | $ | — | $ | — | |||||||
Fixed income securities | 24.3 | 24.3 | — | — | |||||||||||
Cash and short-term securities | 0.3 | 0.3 | — | — | |||||||||||
Total | $ | 81.4 | $ | 81.4 | $ | — | $ | — |
As of December 31, 2017 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – Canada: | |||||||||||||||
Cash and short-term securities | $ | 0.1 | $ | 0.1 | $ | — | $ | — | |||||||
Investments measured at NAV: | |||||||||||||||
Equity securities | 49.2 | ||||||||||||||
Fixed income securities | 25.6 | ||||||||||||||
Total | $ | 74.9 | $ | 0.1 | $ | — | $ | — |
As of December 31, 2016 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – U.S.: | |||||||||||||||
Equity securities | $ | 50.0 | $ | 50.0 | $ | — | $ | — | |||||||
Fixed income securities | 25.7 | 25.7 | — | — | |||||||||||
Cash and short-term securities | 0.2 | 0.2 | — | — | |||||||||||
Total | $ | 75.9 | $ | 75.9 | $ | — | $ | — |
As of December 31, 2016 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – Canada: | |||||||||||||||
Cash and short-term securities | $ | 0.3 | $ | 0.3 | $ | — | $ | — | |||||||
Investments measured at NAV: | |||||||||||||||
Equity securities | 43.8 | ||||||||||||||
Fixed income securities | 20.8 | ||||||||||||||
Total | $ | 64.9 | $ | 0.3 | $ | — | $ | — |
As of December 31, 2017 | Asset Allocation Range | ||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||
Equity securities | $ | 56.8 | $ | 49.2 | 55 - 75% | 50 - 70% | |||||
Fixed income securities | 24.3 | 25.6 | 20 - 40% | 30 - 50% | |||||||
Cash and short-term securities | 0.3 | 0.1 | 0 - 10% | 0 - 5% | |||||||
Total | $ | 81.4 | $ | 74.9 |
As of December 31, 2016 | Asset Allocation Range | ||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||
Equity securities | $ | 50.0 | $ | 43.8 | 55 - 75% | 50 - 70% | |||||
Fixed income securities | 25.7 | 20.8 | 20 - 40% | 30 - 50% | |||||||
Cash and short-term securities | 0.2 | 0.3 | 0 - 10% | 0 - 5% | |||||||
Total | $ | 75.9 | $ | 64.9 |
December 31, | |||||||||||
2017 | 2016 | ||||||||||
U.S. | Canada | U.S. | Canada | ||||||||
Discount rate | 3.33 | % | 3.40 | % | 3.76 | % | 3.85 | % | |||
Rate of compensation increases | N/A | 3.00 | % | N/A | 3.00 | % |
Year Ended December 31, | |||||||||||
2017 | 2016 | ||||||||||
U.S. | Canada | U.S. | Canada | ||||||||
Discount rate | 3.76 | % | 3.85 | % | 4.05 | % | 4.00 | % | |||
Rate of compensation increases | N/A | 3.00 | % | N/A | 3.00 | % | |||||
Expected long-term rate of return on assets | 7.15 | % | 5.50 | % | 7.15 | % | 5.50 | % |
(in millions) | U.S. | Canada | |||||
2018 | $ | 9.6 | $ | 2.8 | |||
2019 | 5.7 | 2.9 | |||||
2020 | 5.4 | 3.0 | |||||
2021 | 5.6 | 3.2 | |||||
2022 | 5.5 | 3.4 | |||||
2023-2027 | 27.7 | 20.1 |
• | Assets contributed to the multi-employer plans by one employer may be used to provide benefits to employees of other participating employers, |
• | If a participating employer ceases contributing to the plan, the unfunded obligations of the plan may be inherited by the remaining participating employers, and |
• | If the Company stops participating in any of the multi-employer plans, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability. |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 | ||||||||
At December 31, | |||||||||||
(in millions) | Other accrued liabilities | Other non-current liabilities | |||||||||
2017 | $ | 0.7 | $ | 27.2 | |||||||
2016 | 0.0 | 9.8 |
Pension Fund | EIN/Pension Plan No. | Pension Protection Act Zone Status | FIP/RP Status Pending/ Implemented | Veritiv's Contributions | Surcharge Imposed | Expiration Date(s) of Collective Bargaining Agreement(s) | |||||||||||||||
2017 | 2016 | 2015 | |||||||||||||||||||
Western Conference of Teamsters Pension Trust Fund (1) | 916145047/001 | Green | No | $ | 1.6 | $ | 1.7 | $ | 1.7 | No | 7/31/2017 - 10/31/2020 | ||||||||||
Central States, Southeast & Southwest Areas Pension Fund (2) | 366044243/001 | Red | Implemented | 0.2 | 0.3 | 0.4 | Yes | 7/31/2018 | |||||||||||||
Teamsters Pension Plan of Philadelphia & Vicinity | 231511735/001 | Yellow | Implemented | 0.4 | 0.4 | 0.4 | Yes | 3/31/2018 & 7/31/2018 | |||||||||||||
Graphic Arts Industry Joint Pension Trust | 521074215/001 | Red | Implemented | — | — | 0.1 | Yes | Exited during 2016 | |||||||||||||
New England Teamsters & Trucking Industry Pension | 046372430/001 | Red | Implemented | 0.4 | 0.5 | 0.4 | Yes | Exited during 2017 | |||||||||||||
Western Pennsylvania Teamsters and Employers Pension Plan | 256029946/001 | Red | Implemented | 0.3 | 0.3 | 0.3 | Yes | 3/31/2019 & 3/31/2020 | |||||||||||||
Contributions for individually significant plans | 2.9 | 3.2 | 3.3 | ||||||||||||||||||
Contributions to other multi-employer plans | 0.6 | 0.5 | 0.6 | ||||||||||||||||||
Total contributions | $ | 3.5 | $ | 3.7 | $ | 3.9 |
|
(in millions) | TRA Contingent Liability | |||
Balance at December 31, 2015 | $ | 63.0 | ||
Change in fair value adjustment recorded in other (income) expense, net | 4.9 | |||
Balance at December 31, 2016 | 67.9 | |||
Change in fair value adjustment recorded in other (income) expense, net (a) | (9.4 | ) | ||
Principal payments | (8.5 | ) | ||
Balance at December 31, 2017 | $ | 50.0 |
(in millions) | AAC Contingent Liability | |||
Balance at August 31, 2017 | $ | 30.0 | ||
Purchase accounting adjustment | (7.8 | ) | ||
Adjusted purchase price | 22.2 | |||
Change in fair value adjustment recorded in other (income) expense, net | 2.0 | |||
Balance at December 31, 2017 | $ | 24.2 |
|
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Rebates receivable | $ | 61.1 | $ | 62.3 | |||
Prepaid expenses | 33.8 | 26.1 | |||||
Other | 38.6 | 30.5 | |||||
Other current assets | $ | 133.5 | $ | 118.9 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Deferred financing costs | $ | 9.3 | $ | 11.9 | |||
Investments in real estate joint ventures | 6.4 | 6.0 | |||||
Below market leasehold agreements | 4.7 | 4.7 | |||||
Other | 10.4 | 7.7 | |||||
Other non-current assets | $ | 30.8 | $ | 30.3 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Accrued payroll and related taxes | $ | 18.0 | $ | 26.0 | |||
Accrued commissions | 23.2 | 21.8 | |||||
Accrued incentive plans | 28.7 | 33.1 | |||||
Other | 3.6 | 3.5 | |||||
Accrued payroll and benefits | $ | 73.5 | $ | 84.4 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Accrued taxes | $ | 12.1 | $ | 9.1 | |||
Accrued customer incentives | 25.1 | 23.3 | |||||
Accrued freight | 16.0 | 13.9 | |||||
Accrued professional fees | 6.7 | 7.3 | |||||
Tax Receivable Agreement contingent liability | 9.9 | 8.5 | |||||
AAC contingent liability and working capital adjustment | 18.4 | — | |||||
Other | 46.4 | 40.4 | |||||
Other accrued liabilities | $ | 134.6 | $ | 102.5 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Tax Receivable Agreement contingent liability | $ | 40.1 | $ | 59.4 | |||
AAC contingent liability | 7.1 | — | |||||
Deferred compensation | 23.7 | 21.6 | |||||
Straight-line rent | 17.5 | 15.7 | |||||
Above market leasehold agreements | 2.1 | 3.1 | |||||
Other, including multi-employer pension plan withdrawals | 46.5 | 21.4 | |||||
Other non-current liabilities | $ | 137.0 | $ | 121.2 |
|
(units in thousands) | Number of RSUs | Weighted-Average Grant Date Fair Value Per Share | |||||
Non-vested at December 31, 2015 | 59 | $ | 51.21 | ||||
Granted | 98 | $ | 36.43 | ||||
Vested | (1 | ) | $ | 47.71 | |||
Forfeited | (10 | ) | $ | 41.35 | |||
Non-vested at December 31, 2016 | 146 | $ | 42.05 | ||||
Granted | 111 | $ | 49.86 | ||||
Vested | — | $ | — | ||||
Forfeited | (8 | ) | $ | 44.21 | |||
Non-vested at December 31, 2017 | 249 | $ | 45.43 |
(units in thousands) | Number of PCSUs | Weighted-Average Grant Date Fair Value Per Share | ||||||
Non-vested at December 31, 2015 | 159 | $ | 51.23 | |||||
Granted | 244 | $ | 47.98 | (1) | ||||
Shares lost based on actual performance | (22 | ) | $ | 36.43 | ||||
Vested | — | $ | — | |||||
Forfeited | (26 | ) | $ | 41.49 | ||||
Non-vested at December 31, 2016 | 355 | $ | 42.14 | |||||
Granted | 166 | $ | 53.56 | (2) | ||||
Shares lost based on actual performance | (45 | ) | $ | 53.56 | ||||
Vested | — | $ | — | |||||
Forfeited | (22 | ) | $ | 40.78 | ||||
Non-vested at December 31, 2017 | 454 | $ | 40.87 |
(units in thousands) | Number of MCPSUs | Weighted-Average Grant Date Fair Value Per Share | |||||
Non-vested at December 31, 2015 | 91 | $ | 62.52 | ||||
Granted | 146 | $ | 42.23 | ||||
Shares earned based on actual performance | 15 | $ | — | ||||
Vested | — | $ | — | ||||
Forfeited/cancelled | (44 | ) | $ | 58.16 | |||
Non-vested at December 31, 2016 | 208 | $ | 48.23 | ||||
Granted | 100 | $ | 71.63 | ||||
Shares lost based on actual performance | (103 | ) | $ | 71.63 | |||
Vested | — | $ | — | ||||
Forfeited/cancelled | (12 | ) | $ | 55.65 | |||
Non-vested at December 31, 2017 | 193 | $ | 56.23 |
|
|
• | Packaging – The Packaging segment provides standard as well as custom and comprehensive packaging solutions for customers based in North America and in key global markets. The business is strategically focused on higher growth industries including light industrial/general manufacturing, food production, fulfillment and internet retail, as well as niche verticals based on geographical and functional expertise. |
• | Facility Solutions – The Facility Solutions segment sources and sells cleaning, break-room and other supplies such as towels, tissues, wipers and dispensers, can liners, commercial cleaning chemicals, soaps and sanitizers, sanitary maintenance supplies and equipment, safety and hazard supplies, and shampoos and amenities primarily in the U.S., Canada and Mexico. |
• | Print – The Print segment sells and distributes commercial printing, writing, copying, digital, wide format and specialty paper products, graphics consumables and graphics equipment primarily in the U.S., Canada and Mexico. This segment also includes customized paper conversion services of commercial printing paper for distribution to document centers and form printers. |
• | Publishing – The Publishing segment sells and distributes coated and uncoated commercial printing papers to publishers, retailers, converters, printers and specialty businesses for use in magazines, catalogs, books, directories, gaming, couponing, retail inserts and direct mail. This segment also provides print management, procurement and supply chain management solutions to simplify paper and print procurement processes for its customers. |
(in millions) | Packaging | Facility Solutions | Print | Publishing | Total Reportable Segments | Corporate & Other | Total | ||||||||||||||||||||
Year Ended December 31, 2017 | |||||||||||||||||||||||||||
Net sales | $ | 3,157.8 | $ | 1,309.7 | $ | 2,793.7 | $ | 958.0 | $ | 8,219.2 | $ | 145.5 | $ | 8,364.7 | |||||||||||||
Adjusted EBITDA | 238.0 | 35.5 | 60.8 | 26.4 | 360.7 | (184.3 | ) | ||||||||||||||||||||
Depreciation and amortization | 15.9 | 6.0 | 10.4 | 1.5 | 33.8 | 20.4 | 54.2 | ||||||||||||||||||||
Restructuring charges, net | 6.1 | 2.3 | 8.0 | 0.0 | 16.4 | 0.3 | 16.7 | ||||||||||||||||||||
Year Ended December 31, 2016 | |||||||||||||||||||||||||||
Net sales | 2,854.2 | 1,271.6 | 3,047.4 | 1,033.6 | 8,206.8 | 119.8 | 8,326.6 | ||||||||||||||||||||
Adjusted EBITDA | 221.2 | 47.0 | 76.8 | 23.6 | 368.6 | (176.4 | ) | ||||||||||||||||||||
Depreciation and amortization | 12.4 | 5.9 | 12.4 | 3.1 | 33.8 | 20.9 | 54.7 | ||||||||||||||||||||
Restructuring charges, net | 4.6 | 2.3 | 5.2 | 0.1 | 12.2 | 0.2 | 12.4 | ||||||||||||||||||||
Year Ended December 31, 2015 | |||||||||||||||||||||||||||
Net sales | 2,829.9 | 1,289.3 | 3,271.8 | 1,215.5 | 8,606.5 | 111.2 | 8,717.7 | ||||||||||||||||||||
Adjusted EBITDA | 212.6 | 41.7 | 79.0 | 34.7 | 368.0 | (186.0 | ) | ||||||||||||||||||||
Depreciation and amortization | 14.4 | 7.1 | 13.5 | 3.1 | 38.1 | 18.8 | 56.9 | ||||||||||||||||||||
Restructuring charges | 3.8 | 2.5 | 3.6 | 0.0 | 9.9 | 1.4 | 11.3 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Income (loss) before income taxes | $ | (1.9 | ) | $ | 40.8 | $ | 44.9 | ||||
Interest expense, net | 31.2 | 27.5 | 27.0 | ||||||||
Depreciation and amortization | 54.2 | 54.7 | 56.9 | ||||||||
Restructuring charges, net | 16.7 | 12.4 | 11.3 | ||||||||
Stock-based compensation | 15.7 | 8.3 | 3.8 | ||||||||
LIFO reserve increase (decrease) | 7.1 | 3.6 | (7.3 | ) | |||||||
Non-restructuring asset impairment charges | 8.4 | 7.7 | 2.6 | ||||||||
Non-restructuring severance charges | 3.5 | 3.1 | 3.3 | ||||||||
Non-restructuring pension charges | 2.2 | 2.4 | — | ||||||||
Acquisition and integration expenses | 36.5 | 25.9 | 34.9 | ||||||||
Fair value adjustment on Tax Receivable Agreement contingent liability | (9.4 | ) | 4.9 | 1.9 | |||||||
Fair value adjustment on contingent consideration liability | 2.0 | — | — | ||||||||
Escheat audit contingent liability | 7.5 | — | — | ||||||||
Other | 2.7 | 0.9 | 2.7 | ||||||||
Adjustment for Corporate & Other | 184.3 | 176.4 | 186.0 | ||||||||
Adjusted EBITDA for reportable segments | $ | 360.7 | $ | 368.6 | $ | 368.0 |
(in millions) | December 31, 2017 | December 31, 2016 | |||||
Packaging | $ | 1,192.2 | $ | 875.9 | |||
Facility Solutions | 416.9 | 397.9 | |||||
Print | 801.8 | 874.1 | |||||
Publishing | 168.6 | 170.0 | |||||
Corporate & Other | 128.9 | 165.8 | |||||
Total assets | $ | 2,708.4 | $ | 2,483.7 |
Net Sales | Property and Equipment, Net | ||||||||||||||||||
Year Ended December 31, | December 31, 2017 | December 31, 2016 | |||||||||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||||||||||
U.S. | $ | 7,510.9 | $ | 7,552.3 | $ | 7,961.3 | $ | 300.6 | $ | 333.8 | |||||||||
Canada | 682.0 | 631.2 | 628.9 | 36.7 | 35.0 | ||||||||||||||
Rest of world | 171.8 | 143.1 | 127.5 | 2.9 | 3.0 | ||||||||||||||
Total | $ | 8,364.7 | $ | 8,326.6 | $ | 8,717.7 | $ | 340.2 | $ | 371.8 |
|
2017 | |||||||||||||||
Three Months Ended | |||||||||||||||
(in millions, except per share data) | March 31 | June 30 | September 30 | December 31 | |||||||||||
Net sales | $ | 1,994.6 | $ | 2,028.9 | $ | 2,116.8 | $ | 2,224.4 | |||||||
Cost of products sold | 1,629.3 | 1,660.5 | 1,736.6 | 1,820.2 | |||||||||||
Net income (loss) | (2.2 | ) | (9.1 | ) | (14.3 | ) | 12.3 | ||||||||
Weighted-average number of shares outstanding – basic | 15.69 | 15.70 | 15.70 | 15.70 | |||||||||||
Weighted-average number of shares outstanding – diluted | 15.69 | 15.70 | 15.70 | 15.98 | |||||||||||
Earnings (loss) per share (1): | |||||||||||||||
Basic earnings (loss) per share | $ | (0.14 | ) | $ | (0.58 | ) | $ | (0.91 | ) | $ | 0.78 | ||||
Diluted earnings (loss) per share | (0.14 | ) | (0.58 | ) | (0.91 | ) | 0.77 | ||||||||
(1) See Note 13, Earning (Loss) Per Share, for discussion about the shares of common stock utilized in the computation of basic and diluted earnings per share for the year ended December 31, 2017. | |||||||||||||||
2016 | |||||||||||||||
Three Months Ended | |||||||||||||||
(in millions, except per share data) | March 31 | June 30 | September 30 | December 31 | |||||||||||
Net sales | $ | 2,019.8 | $ | 2,060.8 | $ | 2,126.6 | $ | 2,119.4 | |||||||
Cost of products sold | 1,654.5 | 1,687.9 | 1,743.8 | 1,740.2 | |||||||||||
Net income | 3.3 | 7.9 | 5.6 | 4.2 | |||||||||||
Weighted-average number of shares outstanding – basic | 16.00 | 16.00 | 16.00 | 15.87 | |||||||||||
Weighted-average number of shares outstanding – diluted | 16.00 | 16.00 | 16.27 | 16.21 | |||||||||||
Earnings per share (1): | |||||||||||||||
Basic earnings per share | $ | 0.21 | $ | 0.49 | $ | 0.35 | $ | 0.26 | |||||||
Diluted earnings per share | 0.21 | 0.49 | 0.34 | 0.26 |
2017 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.4 | $ | 7.5 | $ | 14.2 | $ | 8.4 | |||||||
Restructuring charges, net | 4.1 | 23.2 | 2.7 | (13.3 | ) | ||||||||||
2016 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.2 | $ | 6.1 | $ | 7.3 | $ | 6.3 | |||||||
Restructuring charges, net | 1.7 | (0.3 | ) | 5.8 | 5.2 |
|
Level 1 – | Quoted market prices in active markets for identical assets or liabilities. |
Level 2 – | Observable market-based inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. |
Level 3 – | Unobservable inputs for the asset or liability reflecting the reporting entity’s own assumptions or external inputs from inactive markets. |
Recently Issued Accounting Standards Not Yet Adopted | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
Accounting Standards Update ("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. A proposed ASU has been issued that would add the option for organizations to not provide comparative period financial statements and instead apply the transition requirements as of 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 substantially all operating leases on the balance sheet as a lease obligation and right of use asset. 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. The Company currently does not anticipate making a policy election to use hindsight to determine lease term. 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 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220) | The standard allows companies to reclassify the effect of the change in tax laws and rates on deferred tax assets and liabilities as part of the Tax Act from accumulated other comprehensive income (loss) to retained earnings. The guidance is to be applied to each period in which the effect of the Tax Act (or portion thereof) is recorded and companies may apply it either (1) retrospectively as of the date of enactment or (2) as of the beginning of the period of adoption. | January 1, 2019; early adoption is permitted. | The Company is currently evaluating early adoption and the impact this ASU will have on its Consolidated Financial Statements and related disclosures. |
Recently Adopted Accounting Standards | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
ASU 2014-09, Revenue from Contracts with Customers (Topic 606) | The standard replaces previous revenue recognition standards and significantly expands 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 adopted this ASU on January 1, 2018 applying the modified retrospective method. Focus areas were customer rebates, accounting for customer dedicated inventory and principal/agent considerations. The adoption did not materially impact the Company's Financial Statements and is not expected to have a material impact on future financial results as the adoption did not change the recognition pattern for the Company's existing revenue streams. The Company implemented new internal controls related to contract reviews and revenue recognition disclosures. Additional disclosures will be made as needed in future reports as a result of the adoption in 2018. | |||
Recently Adopted Accounting Standards (continued) | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
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 adopted this ASU on January 1, 2018. The adoption did not materially impact the Company's historical Consolidated Financial Statements or related disclosures. Impacts to future results and disclosures will be dependent upon the presence of any items noted in the standard. | |||
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 adopted 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 adopted this ASU on January 1, 2018. The adoption did not materially impact its historical Consolidated Financial Statements or related disclosures. | |||
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 will not apply to inventories measured by either the last-in first-out 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. For the years ended December 31, 2017 and 2016, approximately 86% and 87% of the inventory balances were measured using LIFO, respectively. |
Recently Adopted Accounting Standards (continued) | ||||||
Standard | Description | Effective Date | Effect on the Financial Statements or Other Significant Matters | |||
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. Impacts to future results and disclosures will be dependent upon the presence of any items noted in the standard. |
|
Year Ended December 31, | |||||||
(in millions) | 2017 | 2016 | |||||
Allowance for doubtful accounts | $ | 32.4 | $ | 23.7 | |||
Other allowances | 11.6 | 10.8 | |||||
Total accounts receivable allowances | $ | 44.0 | $ | 34.5 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Beginning balance, January 1 | $ | 34.5 | $ | 33.3 | $ | 39.0 | |||||
Add / (Deduct): | |||||||||||
Provision for bad debt expense | 15.9 | 2.2 | 7.4 | ||||||||
Net write-offs and recoveries | (7.7 | ) | (6.7 | ) | (13.1 | ) | |||||
Other adjustments(1) | 1.3 | 5.7 | — | ||||||||
Ending balance, December 31 | $ | 44.0 | $ | 34.5 | $ | 33.3 |
Buildings | 40 years |
Leasehold improvements | 1 to 20 years |
Machinery and equipment | 3 to 15 years |
Equipment capital leases and assets related to financing obligations (including financing obligations with related party) | 3 to 15 years |
Internal use software | 3 to 5 years |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Land, buildings and improvements | $ | 106.6 | $ | 132.0 | |||
Machinery and equipment | 145.3 | 131.1 | |||||
Equipment capital leases and assets related to financing obligations (including financing obligations with related party) | 233.3 | 215.5 | |||||
Internal use software | 159.2 | 151.0 | |||||
Construction-in-progress | 10.4 | 35.0 | |||||
Less: Accumulated depreciation and software amortization | (314.6 | ) | (292.8 | ) | |||
Property and equipment, net | $ | 340.2 | $ | 371.8 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Depreciation expense (1) | $ | 33.5 | $ | 33.8 | $ | 32.6 | |||||
Amortization expense - internal use software | 16.5 | 17.5 | 18.4 | ||||||||
Depreciation and amortization expense related to property and equipment | $ | 50.0 | $ | 51.3 | $ | 51.0 | |||||
Accumulated depreciation on equipment capital leases and assets related to financing obligations (including financing obligations with related party) | $ | 35.6 | $ | 29.7 | |||||||
Unamortized internal use software costs, including amounts recorded in CIP | $ | 37.6 | $ | 43.9 |
|
(in millions) | |||
Cash consideration | $ | 112.0 | |
Loan pay-off | 34.3 | ||
Contingent consideration | 22.2 | ||
Other | 1.3 | ||
Total preliminary estimated purchase price | $ | 169.8 |
(in millions) | |||
Cash | $ | 1.5 | |
Accounts receivable | 30.4 | ||
Inventories | 38.5 | ||
Other current assets | 5.7 | ||
Property and equipment | 3.5 | ||
Goodwill | 55.5 | ||
Other intangible assets | 49.0 | ||
Other non-current assets | 1.4 | ||
Accounts payable | (12.4 | ) | |
Other current liabilities | (2.7 | ) | |
Other non-current liabilities | (0.6 | ) | |
Total preliminary estimated purchase price | $ | 169.8 |
(Unaudited) | Year Ended December 31, | ||||||
(in millions, except share and per share data) | 2017 | 2016 | |||||
Net sales | $ | 8,527.6 | $ | 8,548.2 | |||
Net income (loss) | (7.2 | ) | 14.1 | ||||
Earnings (loss) per share: | |||||||
Basic earnings (loss) per share | $ | (0.46 | ) | $ | 0.88 | ||
Diluted earnings (loss) per share | $ | (0.46 | ) | $ | 0.87 | ||
Weighted-average shares outstanding | |||||||
Basic | 15.70 | 15.97 | |||||
Diluted | 15.70 | 16.15 |
|
Year Ended December 31, | ||||||||||||
(in millions) | 2017 | 2016 | 2015 | |||||||||
Integration management | $ | 14.5 | $ | 8.3 | $ | — | ||||||
Retention compensation | 0.2 | 2.5 | 10.8 | |||||||||
Information technology conversion costs | 8.8 | 6.3 | 7.4 | |||||||||
Rebranding | 0.5 | 2.4 | 6.1 | |||||||||
Legal, consulting and other professional fees | 1.5 | 2.3 | 7.8 | |||||||||
Other | 3.0 | 4.1 | 2.8 | |||||||||
AAC acquisition and integration | 8.0 | — | — | |||||||||
Total acquisition and integration expenses | $ | 36.5 | $ | 25.9 | $ | 34.9 |
(in millions) | Severance and Related Costs | Other Direct Costs | Total | ||||||||
Balance at December 31, 2015 | $ | 1.7 | $ | 0.4 | $ | 2.1 | |||||
Costs incurred | 3.5 | 11.0 | 14.5 | ||||||||
Payments | (3.4 | ) | (3.4 | ) | (6.8 | ) | |||||
Balance at December 31, 2016 | 1.8 | 8.0 | 9.8 | ||||||||
Costs incurred | 7.5 | 33.6 | 41.1 | ||||||||
Payments | (4.9 | ) | (16.4 | ) | (21.3 | ) | |||||
Balance at December 31, 2017 | $ | 4.4 | $ | 25.2 | $ | 29.6 |
(in millions) | Severance and Related Costs | Other Direct Costs | Gain on Sale of Assets and Other | Total | |||||||||||
2017 | $ | 7.5 | $ | 33.6 | $ | (24.4 | ) | $ | 16.7 | ||||||
2016 | 3.5 | 11.0 | (2.1 | ) | 12.4 | ||||||||||
2015 | 4.3 | 2.9 | 4.1 | 11.3 | |||||||||||
Cumulative | 20.0 | 47.9 | (22.4 | ) | 45.5 |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 | ||||||||
At December 31, | |||||||||||
(in millions) | Other accrued liabilities | Other non-current liabilities | |||||||||
2017 | $ | 0.7 | $ | 27.2 | |||||||
2016 | 0.0 | 9.8 |
2017 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.4 | $ | 7.5 | $ | 14.2 | $ | 8.4 | |||||||
Restructuring charges, net | 4.1 | 23.2 | 2.7 | (13.3 | ) | ||||||||||
2016 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.2 | $ | 6.1 | $ | 7.3 | $ | 6.3 | |||||||
Restructuring charges, net | 1.7 | (0.3 | ) | 5.8 | 5.2 |
|
(in millions) | Packaging | Facility Solutions | Print | Publishing | Corporate & Other | Total | |||||||||||||||||
Balance at December 31, 2015: | |||||||||||||||||||||||
Goodwill | $ | 44.1 | $ | 59.0 | $ | 265.4 | $ | 50.5 | $ | 6.1 | $ | 425.1 | |||||||||||
Accumulated impairment losses | — | (59.0 | ) | (265.4 | ) | (50.5 | ) | — | (374.9 | ) | |||||||||||||
Net goodwill 2015 | 44.1 | — | — | — | 6.1 | 50.2 | |||||||||||||||||
2016 Activity: | |||||||||||||||||||||||
Goodwill acquired | — | — | — | — | — | — | |||||||||||||||||
Impairment of goodwill | — | — | — | — | — | — | |||||||||||||||||
Balance at December 31, 2016: | |||||||||||||||||||||||
Goodwill | 44.1 | 59.0 | 265.4 | 50.5 | 6.1 | 425.1 | |||||||||||||||||
Accumulated impairment losses | — | (59.0 | ) | (265.4 | ) | (50.5 | ) | — | (374.9 | ) | |||||||||||||
Net goodwill 2016 | 44.1 | — | — | — | 6.1 | 50.2 | |||||||||||||||||
2017 Activity: | |||||||||||||||||||||||
Goodwill acquired | 55.5 | — | — | — | — | 55.5 | |||||||||||||||||
Impairment of goodwill | — | — | — | — | (6.1 | ) | (6.1 | ) | |||||||||||||||
Balance at December 31, 2017: | |||||||||||||||||||||||
Goodwill | 99.6 | 59.0 | 265.4 | 50.5 | 6.1 | 480.6 | |||||||||||||||||
Accumulated impairment losses | — | (59.0 | ) | (265.4 | ) | (50.5 | ) | (6.1 | ) | (381.0 | ) | ||||||||||||
Net goodwill 2017 | $ | 99.6 | $ | — | $ | — | $ | — | $ | — | $ | 99.6 |
December 31, 2017 | December 31, 2016 | ||||||||||||||||||||||
(in millions) | Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net | |||||||||||||||||
Customer relationships | $ | 67.7 | $ | 6.1 | $ | 61.6 | $ | 23.6 | $ | 4.0 | $ | 19.6 | |||||||||||
Trademarks/Trade names | 3.8 | 2.3 | 1.5 | 2.7 | 1.3 | 1.4 | |||||||||||||||||
Non-compete agreements | 1.5 | 0.5 | 1.0 | — | — | — | |||||||||||||||||
Total | $ | 73.0 | $ | 8.9 | $ | 64.1 | $ | 26.3 | $ | 5.3 | $ | 21.0 |
Gross Value (in millions) | Estimated Useful Life (in years) | ||||
Customer relationships | $ | 46.4 | 14.0 | ||
Trademarks/Trade names | 1.1 | 1.0 | |||
Non-compete agreements | 1.5 | 1.0 | |||
Total identifiable intangible assets acquired | $ | 49.0 |
Year | Total | |||
2018 | $ | 6.7 | ||
2019 | 4.8 | |||
2020 | 4.8 | |||
2021 | 4.8 | |||
2022 | 4.8 |
|
(in millions) | December 31, 2017 | December 31, 2016 | |||||
Obligations to related party | $ | 162.3 | $ | 191.0 | |||
Obligations - other financing | 27.1 | — | |||||
Total financing obligations | 189.4 | 191.0 | |||||
Less: current portion of financing obligations | (7.8 | ) | (14.9 | ) | |||
Financing obligations, less current portion | $ | 181.6 | $ | 176.1 |
(in millions) | December 31, 2017 | December 31, 2016 | |||||
Asset-Based Lending Facility (the "ABL Facility") | $ | 897.7 | $ | 726.9 | |||
Equipment capital lease and other obligations | 13.5 | 25.2 | |||||
Total debt | 911.2 | 752.1 | |||||
Less: current maturities of long-term debt | (2.9 | ) | (2.9 | ) | |||
Long-term debt, net of current maturities | $ | 908.3 | $ | 749.2 |
Year Ended December 31, | |||||||||||
(in millions, except number of agreements) | 2017 | 2016 | Total | ||||||||
Property and equipment | $ | 14.6 | $ | 3.7 | $ | 18.3 | |||||
Financing obligations | 15.2 | 8.4 | 23.6 | ||||||||
Number of terminated property agreements | 8 | 3 | 11 |
|
Financing Obligations and Equipment Capital Leases (1) | Operating Leases | ||||||||||||||
(in millions) | Lease Obligations | Sublease Income | Total | ||||||||||||
2018 | $ | 12.8 | $ | 94.3 | $ | (0.2 | ) | $ | 94.1 | ||||||
2019 | 5.0 | 80.3 | (0.2 | ) | 80.1 | ||||||||||
2020 | 4.6 | 70.4 | — | 70.4 | |||||||||||
2021 | 4.0 | 57.7 | — | 57.7 | |||||||||||
2022 | 3.8 | 45.8 | — | 45.8 | |||||||||||
Thereafter | 22.4 | 135.6 | — | 135.6 | |||||||||||
52.6 | 484.1 | (0.4 | ) | 483.7 | |||||||||||
Amount representing interest | (12.5 | ) | — | — | — | ||||||||||
Total future minimum lease payments | $ | 40.1 | $ | 484.1 | $ | (0.4 | ) | $ | 483.7 |
|
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Domestic (United States) | $ | (18.0 | ) | $ | 27.6 | $ | 46.6 | ||||
Foreign | 16.1 | 13.2 | (1.7 | ) | |||||||
Income (loss) before income taxes | $ | (1.9 | ) | $ | 40.8 | $ | 44.9 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Current Provision: | |||||||||||
U.S. Federal | $ | 4.8 | $ | 3.6 | $ | — | |||||
U.S. State | 1.5 | 1.5 | 1.7 | ||||||||
Foreign | 3.2 | 3.6 | 1.6 | ||||||||
Total current income tax expense | $ | 9.5 | $ | 8.7 | $ | 3.3 | |||||
Deferred, net: | |||||||||||
U.S. Federal | $ | 16.3 | $ | 9.6 | $ | 14.8 | |||||
U.S. State | (2.7 | ) | 1.9 | 0.5 | |||||||
Foreign | (11.7 | ) | (0.4 | ) | (0.4 | ) | |||||
Total deferred, net | $ | 1.9 | $ | 11.1 | $ | 14.9 | |||||
Provision for income tax expense (benefit) | $ | 11.4 | $ | 19.8 | $ | 18.2 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Income (loss) before income taxes | $ | (1.9 | ) | $ | 40.8 | $ | 44.9 | ||||
Statutory U.S. income tax rate | 35.0 | % | 35.0 | % | 35.0 | % | |||||
Tax expense using statutory U.S. income tax rate | $ | (0.7 | ) | $ | 14.3 | $ | 15.7 | ||||
Foreign income tax rate differential | (1.4 | ) | (1.1 | ) | 0.2 | ||||||
State tax (net of federal benefit) | (0.5 | ) | 2.8 | 1.6 | |||||||
Non-deductible expenses | 2.2 | 2.3 | 1.5 | ||||||||
Tax Receivable Agreement (a) | (3.8 | ) | 1.6 | 0.7 | |||||||
Tax credits (b) | (4.0 | ) | — | — | |||||||
Foreign exchange loss (c) | — | — | (1.2 | ) | |||||||
Impact of U.S. Tax Act (Federal and State) | 30.2 | — | — | ||||||||
Change in valuation allowance - U.S. Federal and State (d) | — | — | (0.8 | ) | |||||||
Change in valuation allowance - Foreign | (13.7 | ) | (0.5 | ) | 1.7 | ||||||
Goodwill impairment | 2.1 | — | 0.7 | ||||||||
Foreign taxes | 0.7 | 0.5 | 0.1 | ||||||||
Other (e) | 0.3 | (0.1 | ) | (2.0 | ) | ||||||
Income tax provision (benefit) | $ | 11.4 | $ | 19.8 | $ | 18.2 | |||||
Effective income tax rate | (600.0 | )% | 48.5 | % | 40.5 | % |
December 31, 2017 | December 31, 2016 | ||||||||||||||
(in millions) | U.S. | Non-U.S. | U.S. | Non-U.S. | |||||||||||
Deferred income tax assets: | |||||||||||||||
Accrued compensation | $ | 11.6 | $ | 0.2 | $ | 17.7 | $ | 0.1 | |||||||
Financing obligations to related party | 47.3 | 0.8 | 77.5 | 0.8 | |||||||||||
Goodwill and other intangibles, net | 1.9 | — | 4.6 | — | |||||||||||
Long-term compensation | 21.3 | 4.1 | 21.2 | 3.8 | |||||||||||
Net operating losses and credit carryforwards | 44.9 | 11.8 | 74.1 | 13.6 | |||||||||||
Allowance for doubtful accounts | 10.0 | 0.1 | 11.9 | — | |||||||||||
Other | 5.6 | 0.6 | 3.5 | 0.8 | |||||||||||
Gross deferred income tax assets | 142.6 | 17.6 | 210.5 | 19.1 | |||||||||||
Less valuation allowance | (4.7 | ) | (3.6 | ) | (6.5 | ) | (18.1 | ) | |||||||
Total deferred tax asset | 137.9 | 14.0 | 204.0 | 1.0 | |||||||||||
Deferred income tax liabilities: | |||||||||||||||
Property and equipment, net | (54.2 | ) | — | (86.7 | ) | — | |||||||||
Inventory reserve | (33.5 | ) | — | (48.2 | ) | — | |||||||||
Other | (4.6 | ) | — | (8.3 | ) | — | |||||||||
Total deferred tax liability | (92.3 | ) | — | (143.2 | ) | — | |||||||||
Net deferred income tax asset | $ | 45.6 | $ | 14.0 | $ | 60.8 | $ | 1.0 |
(in millions) | U.S. | Non-U.S. | Total | ||||||||
Balance at December 31, 2015 | $ | 6.3 | $ | 15.5 | $ | 21.8 | |||||
Additions | 0.2 | 3.4 | 3.6 | ||||||||
Subtractions | — | (0.9 | ) | (0.9 | ) | ||||||
Currency translation adjustments | — | 0.1 | 0.1 | ||||||||
Balance at December 31, 2016 | 6.5 | 18.1 | 24.6 | ||||||||
Additions | — | 0.2 | 0.2 | ||||||||
Subtractions (a) | (1.8 | ) | (16.0 | ) | (17.8 | ) | |||||
Currency translation adjustments | — | 1.3 | 1.3 | ||||||||
Balance at December 31, 2017 | $ | 4.7 | $ | 3.6 | $ | 8.3 |
|
Year Ended December 31, | ||||||||||||
(in millions) | 2017 | 2016 | 2015 | |||||||||
Sales to Georgia-Pacific, reflected in net sales | $ | 32.2 | $ | 35.6 | $ | 33.6 | ||||||
Purchases of inventory from Georgia-Pacific, recognized in cost of products sold | $ | 181.6 | $ | 224.9 | $ | 264.7 | ||||||
Inventories purchased from Georgia-Pacific that remained on Veritiv's balance sheet | $ | 22.7 | $ | 24.8 | ||||||||
Related party payable to Georgia-Pacific | $ | 8.5 | $ | 9.0 | ||||||||
Related party receivable from Georgia-Pacific | $ | 3.3 | $ | 3.9 |
|
Deferred Compensation Liability | ||||||||
(in millions) | December 31, 2017 | December 31, 2016 | ||||||
Other accrued liabilities | $ | 2.6 | $ | 2.7 | ||||
Other non-current liabilities | 23.7 | 21.6 | ||||||
Total liabilities | $ | 26.3 | $ | 24.3 |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | ||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||||||
Accumulated benefit obligation, end of year | $ | 91.0 | $ | 83.2 | $ | 89.7 | $ | 71.9 | |||||||
Change in projected benefit obligation: | |||||||||||||||
Benefit obligation, beginning of year | $ | 89.7 | $ | 79.0 | $ | 89.0 | $ | 76.0 | |||||||
Service cost | 0.8 | 0.3 | 0.7 | 0.3 | |||||||||||
Interest cost | 2.7 | 2.7 | 3.4 | 3.1 | |||||||||||
Actuarial (gain) loss | 3.3 | 6.1 | — | 2.2 | |||||||||||
Benefits paid | (5.5 | ) | (3.9 | ) | (3.4 | ) | (4.8 | ) | |||||||
Foreign exchange adjustments | — | 5.8 | — | 2.2 | |||||||||||
Projected benefit obligation, end of year | $ | 91.0 | $ | 90.0 | $ | 89.7 | $ | 79.0 | |||||||
Change in plan assets: | |||||||||||||||
Plan assets, beginning of year | $ | 75.9 | $ | 64.9 | $ | 74.4 | $ | 61.6 | |||||||
Employer contributions | — | 3.1 | — | 3.1 | |||||||||||
Investment returns | 12.0 | 6.0 | 5.9 | 3.1 | |||||||||||
Benefits paid | (5.5 | ) | (3.9 | ) | (3.4 | ) | (4.8 | ) | |||||||
Administrative expenses paid | (1.0 | ) | — | (1.0 | ) | — | |||||||||
Foreign exchange adjustments | — | 4.8 | — | 1.9 | |||||||||||
Plan assets, end of year | $ | 81.4 | $ | 74.9 | $ | 75.9 | $ | 64.9 | |||||||
Underfunded status, end of year | $ | (9.6 | ) | $ | (15.1 | ) | $ | (13.8 | ) | $ | (14.1 | ) |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | ||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||||||
Amounts recognized in the Consolidated Balance Sheets consist of: | |||||||||||||||
Other accrued liabilities | $ | 0.1 | $ | 0.2 | $ | 0.1 | $ | 0.2 | |||||||
Defined benefit pension obligations | 9.5 | 14.9 | 13.7 | 13.9 | |||||||||||
Net liability recognized | $ | 9.6 | $ | 15.1 | $ | 13.8 | $ | 14.1 |
Year Ended December 31, | |||||||||||||||
2017 | 2016 | ||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||||||
Amounts not yet reflected in net periodic benefit cost and included in AOCL consist of: | |||||||||||||||
Net loss, net of tax | $ | 3.2 | $ | 6.1 | $ | 5.7 | $ | 3.4 |
Year Ended December 31, | |||||||||||||||||||||||
2017 | 2016 | 2015 | |||||||||||||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | U.S. | Canada | |||||||||||||||||
Components of net periodic benefit cost (credit): | |||||||||||||||||||||||
Service cost | $ | 2.0 | $ | 0.3 | $ | 1.7 | $ | 0.3 | $ | 1.6 | $ | 0.2 | |||||||||||
Interest cost | 2.7 | 2.7 | 3.4 | 3.1 | 3.2 | 3.2 | |||||||||||||||||
Expected return on plan assets | (5.1 | ) | (3.7 | ) | (5.0 | ) | (3.5 | ) | (5.2 | ) | (3.3 | ) | |||||||||||
Amortization of net loss | 0.1 | 0.2 | 0.1 | 0.2 | — | — | |||||||||||||||||
Net periodic benefit cost (credit) | $ | (0.3 | ) | $ | (0.5 | ) | $ | 0.2 | $ | 0.1 | $ | (0.4 | ) | $ | 0.1 | ||||||||
Changes to funded status recognized in other comprehensive (income) loss: | |||||||||||||||||||||||
Net loss (gain) during year, net of tax | $ | (2.5 | ) | $ | 2.7 | $ | (0.5 | ) | $ | 2.2 | $ | 1.0 | $ | (1.0 | ) |
As of December 31, 2017 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – U.S.: | |||||||||||||||
Equity securities | $ | 56.8 | $ | 56.8 | $ | — | $ | — | |||||||
Fixed income securities | 24.3 | 24.3 | — | — | |||||||||||
Cash and short-term securities | 0.3 | 0.3 | — | — | |||||||||||
Total | $ | 81.4 | $ | 81.4 | $ | — | $ | — |
As of December 31, 2017 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – Canada: | |||||||||||||||
Cash and short-term securities | $ | 0.1 | $ | 0.1 | $ | — | $ | — | |||||||
Investments measured at NAV: | |||||||||||||||
Equity securities | 49.2 | ||||||||||||||
Fixed income securities | 25.6 | ||||||||||||||
Total | $ | 74.9 | $ | 0.1 | $ | — | $ | — |
As of December 31, 2016 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – U.S.: | |||||||||||||||
Equity securities | $ | 50.0 | $ | 50.0 | $ | — | $ | — | |||||||
Fixed income securities | 25.7 | 25.7 | — | — | |||||||||||
Cash and short-term securities | 0.2 | 0.2 | — | — | |||||||||||
Total | $ | 75.9 | $ | 75.9 | $ | — | $ | — |
As of December 31, 2016 | |||||||||||||||
(in millions) | Total | Level 1 | Level 2 | Level 3 | |||||||||||
Investments – Canada: | |||||||||||||||
Cash and short-term securities | $ | 0.3 | $ | 0.3 | $ | — | $ | — | |||||||
Investments measured at NAV: | |||||||||||||||
Equity securities | 43.8 | ||||||||||||||
Fixed income securities | 20.8 | ||||||||||||||
Total | $ | 64.9 | $ | 0.3 | $ | — | $ | — |
As of December 31, 2017 | Asset Allocation Range | ||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||
Equity securities | $ | 56.8 | $ | 49.2 | 55 - 75% | 50 - 70% | |||||
Fixed income securities | 24.3 | 25.6 | 20 - 40% | 30 - 50% | |||||||
Cash and short-term securities | 0.3 | 0.1 | 0 - 10% | 0 - 5% | |||||||
Total | $ | 81.4 | $ | 74.9 |
As of December 31, 2016 | Asset Allocation Range | ||||||||||
(in millions) | U.S. | Canada | U.S. | Canada | |||||||
Equity securities | $ | 50.0 | $ | 43.8 | 55 - 75% | 50 - 70% | |||||
Fixed income securities | 25.7 | 20.8 | 20 - 40% | 30 - 50% | |||||||
Cash and short-term securities | 0.2 | 0.3 | 0 - 10% | 0 - 5% | |||||||
Total | $ | 75.9 | $ | 64.9 |
December 31, | |||||||||||
2017 | 2016 | ||||||||||
U.S. | Canada | U.S. | Canada | ||||||||
Discount rate | 3.33 | % | 3.40 | % | 3.76 | % | 3.85 | % | |||
Rate of compensation increases | N/A | 3.00 | % | N/A | 3.00 | % |
Year Ended December 31, | |||||||||||
2017 | 2016 | ||||||||||
U.S. | Canada | U.S. | Canada | ||||||||
Discount rate | 3.76 | % | 3.85 | % | 4.05 | % | 4.00 | % | |||
Rate of compensation increases | N/A | 3.00 | % | N/A | 3.00 | % | |||||
Expected long-term rate of return on assets | 7.15 | % | 5.50 | % | 7.15 | % | 5.50 | % |
(in millions) | U.S. | Canada | |||||
2018 | $ | 9.6 | $ | 2.8 | |||
2019 | 5.7 | 2.9 | |||||
2020 | 5.4 | 3.0 | |||||
2021 | 5.6 | 3.2 | |||||
2022 | 5.5 | 3.4 | |||||
2023-2027 | 27.7 | 20.1 |
(in millions) | Severance and Related Costs | Other Direct Costs | Gain on Sale of Assets and Other | Total | |||||||||||
2017 | $ | 7.5 | $ | 33.6 | $ | (24.4 | ) | $ | 16.7 | ||||||
2016 | 3.5 | 11.0 | (2.1 | ) | 12.4 | ||||||||||
2015 | 4.3 | 2.9 | 4.1 | 11.3 | |||||||||||
Cumulative | 20.0 | 47.9 | (22.4 | ) | 45.5 |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 | ||||||||
At December 31, | |||||||||||
(in millions) | Other accrued liabilities | Other non-current liabilities | |||||||||
2017 | $ | 0.7 | $ | 27.2 | |||||||
2016 | 0.0 | 9.8 |
2017 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.4 | $ | 7.5 | $ | 14.2 | $ | 8.4 | |||||||
Restructuring charges, net | 4.1 | 23.2 | 2.7 | (13.3 | ) | ||||||||||
2016 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.2 | $ | 6.1 | $ | 7.3 | $ | 6.3 | |||||||
Restructuring charges, net | 1.7 | (0.3 | ) | 5.8 | 5.2 |
Pension Fund | EIN/Pension Plan No. | Pension Protection Act Zone Status | FIP/RP Status Pending/ Implemented | Veritiv's Contributions | Surcharge Imposed | Expiration Date(s) of Collective Bargaining Agreement(s) | |||||||||||||||
2017 | 2016 | 2015 | |||||||||||||||||||
Western Conference of Teamsters Pension Trust Fund (1) | 916145047/001 | Green | No | $ | 1.6 | $ | 1.7 | $ | 1.7 | No | 7/31/2017 - 10/31/2020 | ||||||||||
Central States, Southeast & Southwest Areas Pension Fund (2) | 366044243/001 | Red | Implemented | 0.2 | 0.3 | 0.4 | Yes | 7/31/2018 | |||||||||||||
Teamsters Pension Plan of Philadelphia & Vicinity | 231511735/001 | Yellow | Implemented | 0.4 | 0.4 | 0.4 | Yes | 3/31/2018 & 7/31/2018 | |||||||||||||
Graphic Arts Industry Joint Pension Trust | 521074215/001 | Red | Implemented | — | — | 0.1 | Yes | Exited during 2016 | |||||||||||||
New England Teamsters & Trucking Industry Pension | 046372430/001 | Red | Implemented | 0.4 | 0.5 | 0.4 | Yes | Exited during 2017 | |||||||||||||
Western Pennsylvania Teamsters and Employers Pension Plan | 256029946/001 | Red | Implemented | 0.3 | 0.3 | 0.3 | Yes | 3/31/2019 & 3/31/2020 | |||||||||||||
Contributions for individually significant plans | 2.9 | 3.2 | 3.3 | ||||||||||||||||||
Contributions to other multi-employer plans | 0.6 | 0.5 | 0.6 | ||||||||||||||||||
Total contributions | $ | 3.5 | $ | 3.7 | $ | 3.9 |
|
(in millions) | TRA Contingent Liability | |||
Balance at December 31, 2015 | $ | 63.0 | ||
Change in fair value adjustment recorded in other (income) expense, net | 4.9 | |||
Balance at December 31, 2016 | 67.9 | |||
Change in fair value adjustment recorded in other (income) expense, net (a) | (9.4 | ) | ||
Principal payments | (8.5 | ) | ||
Balance at December 31, 2017 | $ | 50.0 |
(in millions) | AAC Contingent Liability | |||
Balance at August 31, 2017 | $ | 30.0 | ||
Purchase accounting adjustment | (7.8 | ) | ||
Adjusted purchase price | 22.2 | |||
Change in fair value adjustment recorded in other (income) expense, net | 2.0 | |||
Balance at December 31, 2017 | $ | 24.2 |
|
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Rebates receivable | $ | 61.1 | $ | 62.3 | |||
Prepaid expenses | 33.8 | 26.1 | |||||
Other | 38.6 | 30.5 | |||||
Other current assets | $ | 133.5 | $ | 118.9 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Deferred financing costs | $ | 9.3 | $ | 11.9 | |||
Investments in real estate joint ventures | 6.4 | 6.0 | |||||
Below market leasehold agreements | 4.7 | 4.7 | |||||
Other | 10.4 | 7.7 | |||||
Other non-current assets | $ | 30.8 | $ | 30.3 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Accrued payroll and related taxes | $ | 18.0 | $ | 26.0 | |||
Accrued commissions | 23.2 | 21.8 | |||||
Accrued incentive plans | 28.7 | 33.1 | |||||
Other | 3.6 | 3.5 | |||||
Accrued payroll and benefits | $ | 73.5 | $ | 84.4 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Accrued taxes | $ | 12.1 | $ | 9.1 | |||
Accrued customer incentives | 25.1 | 23.3 | |||||
Accrued freight | 16.0 | 13.9 | |||||
Accrued professional fees | 6.7 | 7.3 | |||||
Tax Receivable Agreement contingent liability | 9.9 | 8.5 | |||||
AAC contingent liability and working capital adjustment | 18.4 | — | |||||
Other | 46.4 | 40.4 | |||||
Other accrued liabilities | $ | 134.6 | $ | 102.5 |
(in millions) | December 31, | December 31, | |||||
2017 | 2016 | ||||||
Tax Receivable Agreement contingent liability | $ | 40.1 | $ | 59.4 | |||
AAC contingent liability | 7.1 | — | |||||
Deferred compensation | 23.7 | 21.6 | |||||
Straight-line rent | 17.5 | 15.7 | |||||
Above market leasehold agreements | 2.1 | 3.1 | |||||
Other, including multi-employer pension plan withdrawals | 46.5 | 21.4 | |||||
Other non-current liabilities | $ | 137.0 | $ | 121.2 |
|
(units in thousands) | Number of RSUs | Weighted-Average Grant Date Fair Value Per Share | |||||
Non-vested at December 31, 2015 | 59 | $ | 51.21 | ||||
Granted | 98 | $ | 36.43 | ||||
Vested | (1 | ) | $ | 47.71 | |||
Forfeited | (10 | ) | $ | 41.35 | |||
Non-vested at December 31, 2016 | 146 | $ | 42.05 | ||||
Granted | 111 | $ | 49.86 | ||||
Vested | — | $ | — | ||||
Forfeited | (8 | ) | $ | 44.21 | |||
Non-vested at December 31, 2017 | 249 | $ | 45.43 |
(units in thousands) | Number of PCSUs | Weighted-Average Grant Date Fair Value Per Share | ||||||
Non-vested at December 31, 2015 | 159 | $ | 51.23 | |||||
Granted | 244 | $ | 47.98 | (1) | ||||
Shares lost based on actual performance | (22 | ) | $ | 36.43 | ||||
Vested | — | $ | — | |||||
Forfeited | (26 | ) | $ | 41.49 | ||||
Non-vested at December 31, 2016 | 355 | $ | 42.14 | |||||
Granted | 166 | $ | 53.56 | (2) | ||||
Shares lost based on actual performance | (45 | ) | $ | 53.56 | ||||
Vested | — | $ | — | |||||
Forfeited | (22 | ) | $ | 40.78 | ||||
Non-vested at December 31, 2017 | 454 | $ | 40.87 |
(units in thousands) | Number of MCPSUs | Weighted-Average Grant Date Fair Value Per Share | |||||
Non-vested at December 31, 2015 | 91 | $ | 62.52 | ||||
Granted | 146 | $ | 42.23 | ||||
Shares earned based on actual performance | 15 | $ | — | ||||
Vested | — | $ | — | ||||
Forfeited/cancelled | (44 | ) | $ | 58.16 | |||
Non-vested at December 31, 2016 | 208 | $ | 48.23 | ||||
Granted | 100 | $ | 71.63 | ||||
Shares lost based on actual performance | (103 | ) | $ | 71.63 | |||
Vested | — | $ | — | ||||
Forfeited/cancelled | (12 | ) | $ | 55.65 | |||
Non-vested at December 31, 2017 | 193 | $ | 56.23 |
|
(in millions) | Packaging | Facility Solutions | Print | Publishing | Total Reportable Segments | Corporate & Other | Total | ||||||||||||||||||||
Year Ended December 31, 2017 | |||||||||||||||||||||||||||
Net sales | $ | 3,157.8 | $ | 1,309.7 | $ | 2,793.7 | $ | 958.0 | $ | 8,219.2 | $ | 145.5 | $ | 8,364.7 | |||||||||||||
Adjusted EBITDA | 238.0 | 35.5 | 60.8 | 26.4 | 360.7 | (184.3 | ) | ||||||||||||||||||||
Depreciation and amortization | 15.9 | 6.0 | 10.4 | 1.5 | 33.8 | 20.4 | 54.2 | ||||||||||||||||||||
Restructuring charges, net | 6.1 | 2.3 | 8.0 | 0.0 | 16.4 | 0.3 | 16.7 | ||||||||||||||||||||
Year Ended December 31, 2016 | |||||||||||||||||||||||||||
Net sales | 2,854.2 | 1,271.6 | 3,047.4 | 1,033.6 | 8,206.8 | 119.8 | 8,326.6 | ||||||||||||||||||||
Adjusted EBITDA | 221.2 | 47.0 | 76.8 | 23.6 | 368.6 | (176.4 | ) | ||||||||||||||||||||
Depreciation and amortization | 12.4 | 5.9 | 12.4 | 3.1 | 33.8 | 20.9 | 54.7 | ||||||||||||||||||||
Restructuring charges, net | 4.6 | 2.3 | 5.2 | 0.1 | 12.2 | 0.2 | 12.4 | ||||||||||||||||||||
Year Ended December 31, 2015 | |||||||||||||||||||||||||||
Net sales | 2,829.9 | 1,289.3 | 3,271.8 | 1,215.5 | 8,606.5 | 111.2 | 8,717.7 | ||||||||||||||||||||
Adjusted EBITDA | 212.6 | 41.7 | 79.0 | 34.7 | 368.0 | (186.0 | ) | ||||||||||||||||||||
Depreciation and amortization | 14.4 | 7.1 | 13.5 | 3.1 | 38.1 | 18.8 | 56.9 | ||||||||||||||||||||
Restructuring charges | 3.8 | 2.5 | 3.6 | 0.0 | 9.9 | 1.4 | 11.3 |
Year Ended December 31, | |||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||
Income (loss) before income taxes | $ | (1.9 | ) | $ | 40.8 | $ | 44.9 | ||||
Interest expense, net | 31.2 | 27.5 | 27.0 | ||||||||
Depreciation and amortization | 54.2 | 54.7 | 56.9 | ||||||||
Restructuring charges, net | 16.7 | 12.4 | 11.3 | ||||||||
Stock-based compensation | 15.7 | 8.3 | 3.8 | ||||||||
LIFO reserve increase (decrease) | 7.1 | 3.6 | (7.3 | ) | |||||||
Non-restructuring asset impairment charges | 8.4 | 7.7 | 2.6 | ||||||||
Non-restructuring severance charges | 3.5 | 3.1 | 3.3 | ||||||||
Non-restructuring pension charges | 2.2 | 2.4 | — | ||||||||
Acquisition and integration expenses | 36.5 | 25.9 | 34.9 | ||||||||
Fair value adjustment on Tax Receivable Agreement contingent liability | (9.4 | ) | 4.9 | 1.9 | |||||||
Fair value adjustment on contingent consideration liability | 2.0 | — | — | ||||||||
Escheat audit contingent liability | 7.5 | — | — | ||||||||
Other | 2.7 | 0.9 | 2.7 | ||||||||
Adjustment for Corporate & Other | 184.3 | 176.4 | 186.0 | ||||||||
Adjusted EBITDA for reportable segments | $ | 360.7 | $ | 368.6 | $ | 368.0 |
(in millions) | December 31, 2017 | December 31, 2016 | |||||
Packaging | $ | 1,192.2 | $ | 875.9 | |||
Facility Solutions | 416.9 | 397.9 | |||||
Print | 801.8 | 874.1 | |||||
Publishing | 168.6 | 170.0 | |||||
Corporate & Other | 128.9 | 165.8 | |||||
Total assets | $ | 2,708.4 | $ | 2,483.7 |
Net Sales | Property and Equipment, Net | ||||||||||||||||||
Year Ended December 31, | December 31, 2017 | December 31, 2016 | |||||||||||||||||
(in millions) | 2017 | 2016 | 2015 | ||||||||||||||||
U.S. | $ | 7,510.9 | $ | 7,552.3 | $ | 7,961.3 | $ | 300.6 | $ | 333.8 | |||||||||
Canada | 682.0 | 631.2 | 628.9 | 36.7 | 35.0 | ||||||||||||||
Rest of world | 171.8 | 143.1 | 127.5 | 2.9 | 3.0 | ||||||||||||||
Total | $ | 8,364.7 | $ | 8,326.6 | $ | 8,717.7 | $ | 340.2 | $ | 371.8 |
|
2017 | |||||||||||||||
Three Months Ended | |||||||||||||||
(in millions, except per share data) | March 31 | June 30 | September 30 | December 31 | |||||||||||
Net sales | $ | 1,994.6 | $ | 2,028.9 | $ | 2,116.8 | $ | 2,224.4 | |||||||
Cost of products sold | 1,629.3 | 1,660.5 | 1,736.6 | 1,820.2 | |||||||||||
Net income (loss) | (2.2 | ) | (9.1 | ) | (14.3 | ) | 12.3 | ||||||||
Weighted-average number of shares outstanding – basic | 15.69 | 15.70 | 15.70 | 15.70 | |||||||||||
Weighted-average number of shares outstanding – diluted | 15.69 | 15.70 | 15.70 | 15.98 | |||||||||||
Earnings (loss) per share (1): | |||||||||||||||
Basic earnings (loss) per share | $ | (0.14 | ) | $ | (0.58 | ) | $ | (0.91 | ) | $ | 0.78 | ||||
Diluted earnings (loss) per share | (0.14 | ) | (0.58 | ) | (0.91 | ) | 0.77 | ||||||||
(1) See Note 13, Earning (Loss) Per Share, for discussion about the shares of common stock utilized in the computation of basic and diluted earnings per share for the year ended December 31, 2017. | |||||||||||||||
2016 | |||||||||||||||
Three Months Ended | |||||||||||||||
(in millions, except per share data) | March 31 | June 30 | September 30 | December 31 | |||||||||||
Net sales | $ | 2,019.8 | $ | 2,060.8 | $ | 2,126.6 | $ | 2,119.4 | |||||||
Cost of products sold | 1,654.5 | 1,687.9 | 1,743.8 | 1,740.2 | |||||||||||
Net income | 3.3 | 7.9 | 5.6 | 4.2 | |||||||||||
Weighted-average number of shares outstanding – basic | 16.00 | 16.00 | 16.00 | 15.87 | |||||||||||
Weighted-average number of shares outstanding – diluted | 16.00 | 16.00 | 16.27 | 16.21 | |||||||||||
Earnings per share (1): | |||||||||||||||
Basic earnings per share | $ | 0.21 | $ | 0.49 | $ | 0.35 | $ | 0.26 | |||||||
Diluted earnings per share | 0.21 | 0.49 | 0.34 | 0.26 |
(in millions) | Severance and Related Costs | Other Direct Costs | Gain on Sale of Assets and Other | Total | |||||||||||
2017 | $ | 7.5 | $ | 33.6 | $ | (24.4 | ) | $ | 16.7 | ||||||
2016 | 3.5 | 11.0 | (2.1 | ) | 12.4 | ||||||||||
2015 | 4.3 | 2.9 | 4.1 | 11.3 | |||||||||||
Cumulative | 20.0 | 47.9 | (22.4 | ) | 45.5 |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 |
Year Ended December 31, | |||||||||||
(in millions) | Restructuring charges, net | Distribution expenses | Total Net Charges | ||||||||
2017 | $ | 17.4 | $ | 2.1 | $ | 19.5 | |||||
2016 | 7.5 | 2.3 | 9.8 | ||||||||
At December 31, | |||||||||||
(in millions) | Other accrued liabilities | Other non-current liabilities | |||||||||
2017 | $ | 0.7 | $ | 27.2 | |||||||
2016 | 0.0 | 9.8 |
2017 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.4 | $ | 7.5 | $ | 14.2 | $ | 8.4 | |||||||
Restructuring charges, net | 4.1 | 23.2 | 2.7 | (13.3 | ) | ||||||||||
2016 | |||||||||||||||
(in millions) | Three Months Ended | ||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||
Acquisition and integration expenses | $ | 6.2 | $ | 6.1 | $ | 7.3 | $ | 6.3 | |||||||
Restructuring charges, net | 1.7 | (0.3 | ) | 5.8 | 5.2 |
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