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Business Segments
 12 Months Ended
Dec. 31, 2020
Segment Reporting [Abstract]  
Business Segments BUSINESS SEGMENTS
Basis of Presentation.  The Company’s organizational structure is based on a number of factors that management uses to evaluate, view and run its business operations, which include, but are not limited to, customers, the nature of products and services and use of resources. The business segments disclosed in the Consolidated Financial Statements are based on this organizational structure and information reviewed by the Company’s management to evaluate the business segment results.
In June 2020, Kaplan announced a plan to combine its three primary divisions based in the United States (Kaplan Test Preparation, Kaplan Professional, and Kaplan Higher Education) into one business known as Kaplan North America. The plan for this combination was implemented in the second half of 2020 and is designed to create and reinforce Kaplan’s competitiveness in each market, and new markets into which Kaplan extends. Following completion of the plan, the Kaplan Test Preparation and Kaplan Professional segments were combined into the Kaplan Supplemental Education segment. Prior to the combination, the Company performed an impairment review of the $64.7 million and $89.5 million goodwill balances at the Kaplan Test Preparation and Kaplan Professional reporting units, respectively. The quantitative goodwill impairment analysis indicated the estimated fair value of both reporting units exceeded their carrying values.
In July 2020, SocialCode announced it will split into two separate companies. SocialCode’s marketing agency business continues to operate under the new name Code3, and the legacy business surrounding the Audience Intelligence Platform (AIP) continues as a separate software company, operating under the new name, Decile. Following the split, the Company started reporting Code3 and Decile in other businesses.
As a result of these changes, the Company changed the presentation of its segments in the third and fourth quarters of 2020 into the following six reportable segments: Kaplan International, Kaplan Higher Education, Kaplan Supplemental Education, Television Broadcasting, Manufacturing and Healthcare.
The Company evaluates segment performance based on operating income before amortization of intangible assets and impairment of goodwill and other long-lived assets. The accounting policies at the segments are the same as
described in Note 2. In computing operating income before amortization by segment, the effects of amortization of intangible assets, impairment of goodwill and other long-lived assets, equity in earnings (losses) of affiliates, interest income, interest expense, non-operating pension and postretirement benefit income, other non-operating income and expense items and income taxes are not included. Intersegment sales are not material.
Identifiable assets by segment are those assets used in the Company’s operations in each business segment. The investments in marketable equity securities and affiliates, and prepaid pension cost are not included in identifiable assets by segment. Investments in marketable equity securities are discussed in Note 4.  
Education.  Education products and services are provided by Kaplan, Inc. Kaplan International includes professional training and postsecondary education businesses largely outside the U.S., as well as English-language programs. Prior to the KU Transaction closing on March 22, 2018, KHE included Kaplan’s domestic postsecondary education business, made up of fixed-facility colleges and online postsecondary and career programs. Following the KU Transaction closing, KHE includes the results as a service provider to higher education institutions. Supplemental Education includes Kaplan’s standardized test preparation, domestic professional and other continuing education businesses.
As of December 31, 2020, Kaplan had a total outstanding accounts receivable balance of $87.3 million from Purdue Global related to amounts due for reimbursements for services, fees earned and a deferred fee. In addition, Kaplan has a $19.9 million long-term receivable balance due from Purdue Global at December 31, 2020, related to the advance of $20.0 million during the initial KU Transaction.
Television Broadcasting.  Television broadcasting operations are conducted through seven television stations serving the Detroit, Houston, San Antonio, Orlando, Jacksonville and Roanoke television markets. All stations are network-affiliated (except for WJXT in Jacksonville), with revenues derived primarily from sales of advertising time. In addition, the stations generate revenue from retransmission consent agreements for the right to carry their signals.
Manufacturing. Manufacturing operations include Hoover, a Thomson, GA-based supplier of pressure impregnated kiln-dried lumber and plywood products for fire retardant and preservative application; Dekko, a Garrett, IN-based manufacturer of electrical workspace solutions, architectural lighting, and electrical components and assemblies; Joyce/Dayton Corp., a Dayton, OH-based manufacturer of screw jacks and other linear motion systems; and Forney, a global supplier of products and systems that control and monitor combustion processes in electric utility and industrial applications.
Healthcare. Graham Healthcare Group provides home health, hospice and palliative services.
Other Businesses. Other businesses includes the following:
•Three automotive dealerships, including Lexus of Rockville and Honda of Tysons Corner, which were acquired on January 31, 2019 and Jeep of Bethesda, which opened in December 2019.
•Clyde’s Restaurant Group (acquired on July 31, 2019) owns and operates eleven restaurants and entertainment venues in the Washington, D.C. metropolitan area.
•Code3 is a marketing and insights company that manages digital advertising companies.
•Decile is a customer data and analytics software company.
•Framebridge, a custom framing service company, which was acquired in May 2020.
•The Slate Group and Foreign Policy Group, which publish online and print magazines and websites; and three investment stage businesses, Megaphone (sold in December 2020), Pinna and CyberVista.
Corporate Office.  Corporate office includes the expenses of the Company’s corporate office, defined benefit pension expense, and certain continuing obligations related to prior business dispositions.
Geographical Information.  The Company’s non-U.S. revenues in 2020, 2019 and 2018 totaled approximately $642 million, $691 million and $657 million, respectively, primarily from Kaplan’s operations outside the U.S. Additionally, revenues in 2020, 2019 and 2018 totaled approximately $375 million, $384 million, and $345 million, respectively, from Kaplan’s operations in the U.K. The Company’s long-lived assets in non-U.S. countries (excluding goodwill and other intangible assets), totaled approximately $442 million and $431 million at December 31, 2020 and 2019, respectively.
Restructuring. Kaplan developed and implemented a number of initiatives across its businesses to help mitigate the negative revenue impact arising from COVID-19 and to re-align its program offerings to better pursue opportunities from the disruption. These initiatives include employee salary and work-hour reductions; temporary furlough and other employee reductions; reduced discretionary spending; facility restructuring to reduce its
classroom and office facilities; reduced capital expenditures; and accelerated development and promotion of various online programs and solutions.
In 2020, Kaplan recorded restructuring costs related to severance, the exit of classroom and office facilities, and approved Separation Incentive Programs that reduced the number of employees at all of Kaplan’s divisions.
In 2020, Code3 and Decile recorded restructuring costs in connection with a restructuring plan that included the exit of an office facility, an approved Separation Incentive Program to reduce the number of employees, and other cost reduction initiatives to mitigate the adverse impact of COVID-19 on advertising demand.
Restructuring related costs across all businesses in 2020 were recorded as follows:
(in thousands)Kaplan InternationalHigher EducationSupplemental EducationKaplan CorporateTotal EducationOther BusinessesTotal
Severance$4,366 $— $1,797 $— $6,163 $— $6,163 
Facility related costs:
Operating lease cost2,905 3,451 3,586 — 9,942 — 9,942 
Accelerated depreciation of property, plant and equipment1,620 152 1,801 — 3,573 — 3,573 
Total Restructuring Costs Included in Segment Results (1)
$8,891 $3,603 $7,184 $— $19,678 $— $19,678 
Impairment of other long-lived assets:
Lease right-of-use assets$3,976 $2,062 $4,005 $— $10,043 $1,405 $11,448 
Property, plant and equipment1,248 174 813 — 2,235 86 2,321 
Non-operating pension and postretirement benefit income, net1,100 2,233 8,566 883 12,782 999 13,781 
Total Restructuring Related Costs$15,215 $8,072 $20,568 $883 $44,738 $2,490 $47,228 
(1)    These amounts are included in the segments’ Income (Loss) from Operations before Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets.
Total accrued restructuring costs at Kaplan were $4.7 million and $1.3 million as of December 31, 2020 and 2019, respectively.
In June 2020, CRG made the decision to close its restaurant and entertainment venue in Columbia, MD effective July 19, 2020 and recorded accelerated depreciation of property, plant and equipment totaling $5.7 million for the year ended December 31, 2020.
Company information broken down by operating segment and education division:
Year Ended December 31
(in thousands)202020192018
Operating Revenues   
Education$1,305,713 $1,451,750 $1,451,015 
Television broadcasting525,212 463,464 505,549 
Manufacturing416,137 449,053 487,619 
Healthcare198,196 161,768 149,275 
Other businesses445,491 406,731 102,608 
Corporate office— — — 
Intersegment elimination(1,628)(667)(100)
 $2,889,121 $2,932,099 $2,695,966 
Income (Loss) before Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets
Education$41,056 $63,680 $106,498 
Television broadcasting199,938 166,076 216,165 
Manufacturing40,427 46,809 53,597 
Healthcare30,327 14,319 6,454 
Other businesses(72,413)(32,786)(28,169)
Corporate office(51,978)(51,157)(52,861)
$187,357 $206,941 $301,684 
Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets
Education$29,452 $15,608 $9,362 
Television broadcasting5,440 13,408 5,632 
Manufacturing28,099 26,342 24,746 
Healthcare4,220 6,411 14,855 
Other businesses19,739 626 928 
Corporate office— — — 
 $86,950 $62,395 $55,523 
Income (Loss) from Operations
Education$11,604 $48,072 $97,136 
Television broadcasting194,498 152,668 210,533 
Manufacturing12,328 20,467 28,851 
Healthcare26,107 7,908 (8,401)
Other businesses(92,152)(33,412)(29,097)
Corporate office(51,978)(51,157)(52,861)
 $100,407 $144,546 $246,161 
Equity in Earnings of Affiliates, Net6,664 11,664 14,473 
Interest Expense, Net(34,439)(23,628)(32,549)
Debt Extinguishment Costs— — (11,378)
Non-Operating Pension and Postretirement Benefit Income, Net59,315 162,798 120,541 
Gain (Loss) on Marketable Equity Securities, net60,787 98,668 (15,843)
Other Income, Net214,534 32,431 2,103 
Income Before Income Taxes$407,268 $426,479 $323,508 
Depreciation of Property, Plant and Equipment   
Education$31,759 $25,655 $28,099 
Television broadcasting13,830 12,817 13,204 
Manufacturing10,333 10,036 9,515 
Healthcare1,665 2,314 2,577 
Other businesses15,964 7,556 2,320 
Corporate office706 875 1,007 
 $74,257 $59,253 $56,722 
Pension Service Cost   
Education$10,024 $10,385 $8,753 
Television broadcasting3,263 3,025 2,188 
Manufacturing1,424 80 72 
Healthcare543 492 573 
Other businesses1,698 1,640 1,301 
Corporate office5,704 4,800 5,334 
 $22,656 $20,422 $18,221 
Capital Expenditures   
Education$33,553 $57,246 $54,159 
Television broadcasting13,470 19,362 27,013 
Manufacturing8,034 11,218 14,806 
Healthcare2,481 2,303 1,741 
Other businesses8,256 3,703 348 
Corporate office80 115 — 
 $65,874 $93,947 $98,067 
Asset information for the Company’s business segments is as follows:
 As of December 31
(in thousands)20202019
Identifiable Assets  
Education$1,975,104 $2,032,425 
Television broadcasting453,988 463,689 
Manufacturing551,611 564,251 
Healthcare160,654 160,033 
Other businesses517,533 567,395 
Corporate office348,045 103,764 
 $4,006,935 $3,891,557 
Investments in Marketable Equity Securities573,102 585,080 
Investments in Affiliates155,777 162,249 
Prepaid Pension Cost1,708,305 1,292,350 
Total Assets$6,444,119 $5,931,236 
The Company’s education division comprises the following operating segments:
Year Ended December 31
(in thousands)202020192018
Operating Revenues   
Kaplan international$653,892 $750,245 $719,982 
Higher education316,095 305,672 342,085 
Supplemental education327,087 388,814 390,289 
Kaplan corporate and other12,643 9,480 1,142 
Intersegment elimination(4,004)(2,461)(2,483)
 $1,305,713 $1,451,750 $1,451,015 
Income (Loss) From Operations before Amortization of Intangible Assets and Impairment of Long-Lived Assets
Kaplan international$15,248 $42,129 $70,315 
Higher education24,364 13,960 15,217 
Supplemental education19,705 34,487 47,704 
Kaplan corporate and other(18,266)(26,891)(26,702)
Intersegment elimination5 (5)(36)
$41,056 $63,680 $106,498 
Amortization of Intangible Assets$17,174 $14,915 $9,362 
Impairment of Long-Lived Assets$12,278 $693 $— 
Income (Loss) from Operations   
Kaplan international$15,248 $42,129 $70,315 
Higher education24,364 13,960 15,217 
Supplemental education19,705 34,487 47,704 
Kaplan corporate and other(47,718)(42,499)(36,064)
Intersegment elimination5 (5)(36)
 $11,604 $48,072 $97,136 
Depreciation of Property, Plant and Equipment   
Kaplan international$19,562 $15,394 $15,755 
Higher education3,082 2,883 4,826 
Supplemental education8,724 7,132 7,037 
Kaplan corporate and other391 246 481 
 $31,759 $25,655 $28,099 
Pension Service Cost   
Kaplan international$433 $454 $298 
Higher education4,150 4,535 4,310 
Supplemental education4,207 4,734 3,773 
Kaplan corporate and other1,234 662 372 
 $10,024 $10,385 $8,753 
Capital Expenditures   
Kaplan international$24,085 $48,362 $44,469 
Higher education3,234 3,463 4,045 
Supplemental education6,030 5,362 5,526 
Kaplan corporate and other204 59 119 
 $33,553 $57,246 $54,159 
Asset information for the Company’s education division is as follows:
 As of December 31
(in thousands)20202019
Identifiable Assets
Kaplan international$1,455,722 $1,455,122 
Higher education187,123 196,761 
Supplemental education274,687 312,454 
Kaplan corporate and other57,572 68,088 
 $1,975,104 $2,032,425