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Segment Information
 3 Months Ended
Feb. 28, 2013
Segment Reporting Disclosure [Text Block]

3. Segment Information


The Company categorizes its businesses into five reportable segments: Children’s Book Publishing and Distribution; Educational Technology and Services; Classroom and Supplemental Materials Publishing; Media, Licensing and Advertising; andInternational. This classification reflects the nature of products and services consistent with the method by which the Company’s chief operating decision-maker assesses operating performance and allocates resources.


 

 

•

Children’s Book Publishing and Distribution operates as an integrated business which includes the publication and distribution of children’s books and other products in the United States through school-based book clubs and book fairs, ecommerce and the trade channel. This segment is comprised of three operating segments.

 

 

•

Educational Technology and Services includes the production and distribution to schools of curriculum-based learning technology and materials for grades pre-kindergarten to 12 in the United States, together with related implementation and assessment services and school consulting services. This segment is comprised of one operating segment.

 

 

•

Classroom and Supplemental Materials Publishing includes the publication and distribution to schools and libraries of children’s books, classroom magazines, supplemental classroom materials and print and on-line reference and non-fiction products for grades pre-kindergarten to 12 in the United States. This segment is comprised of two operating segments.

 

 

•

Media, Licensing and Advertising includes the production and/or distribution of digital media, consumer promotions and merchandising and advertising revenue, including sponsorship programs. This segment is comprised of two operating segments.

 

 

•

International includes the publication and distribution of products and services outside the United States by the Company’s international operations, and its export and foreign rights businesses. This segment is comprised of two operating segments.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Children’s
Book
 Publishing
and
Distribution(1) (2)

 

Educational
 Technology
and Services(1)

 

Classroom and
 Supplemental
 Materials
Publishing(1)

 

Media,
 Licensing
and
Advertising(1) (2)

 

Overhead(1) (3)

 

Total
 Domestic

 

International(1)

 

Total

 

Three months ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

February 28, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

189.4

 

$

41.8

 

$

43.2

 

$

11.7

 

$

—

 

$

286.1

 

$

94.4

 

$

380.5

 

Bad debt expense

 

 

(1.6

)

 

0.5

 

 

—

 

 

—

 

 

—

 

 

(1.1

)

 

0.5

 

 

(0.6

)

Depreciation and amortization(4)

 

 

4.0

 

 

0.3

 

 

0.3

 

 

0.1

 

 

10.3

 

 

15.0

 

 

1.5

 

 

16.5

 

Amortization(5)

 

 

3.7

 

 

5.5

 

 

2.1

 

 

1.0

 

 

—

 

 

12.3

 

 

0.4

 

 

12.7

 

Loss on leases and asset impairments

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

Segment operating income (loss)

 

 

(10.1

)

 

(3.5

)

 

(0.2

)

 

(2.3

)

 

(13.6

)

 

(29.7

)

 

2.0

 

 

(27.7

)

Expenditures for long-lived assets including royalty advances

 

 

11.9

 

 

10.6

 

 

2.7

 

 

1.7

 

 

7.6

 

 

34.5

 

 

3.5

 

 

38.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

February 29, 2012

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

268.8

 

$

40.0

 

$

38.2

 

$

14.4

 

$

—

 

$

361.4

 

$

105.6

 

$

467.0

 

Bad debt expense

 

 

1.6

 

 

0.3

 

 

0.4

 

 

—

 

 

—

 

 

2.3

 

 

0.8

 

 

3.1

 

Depreciation and amortization(4)

 

 

4.4

 

 

0.2

 

 

0.3

 

 

—

 

 

9.1

 

 

14.0

 

 

2.0

 

 

16.0

 

Amortization(5)

 

 

2.8

 

 

5.3

 

 

1.8

 

 

1.5

 

 

—

 

 

11.4

 

 

0.6

 

 

12.0

 

Loss on leases and asset impairments

 

 

0.5

 

 

—

 

 

—

 

 

—

 

 

—

 

 

0.5

 

 

0.3

 

 

0.8

 

Segment operating income (loss)

 

 

12.2

 

 

(5.9

)

 

(3.4

)

 

(1.2

)

 

(17.9

)

 

(16.2

)

 

4.3

 

 

(11.9

)

Expenditures for long-lived assets including royalty advances

 

 

11.7

 

 

6.7

 

 

4.9

 

 

1.3

 

 

9.4

 

 

34.0

 

 

5.1

 

 

39.1

 


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Children’s
Book
 Publishing
and
Distribution(1) (2)

 

Educational
 Technology
and Services(1)

 

Classroom and
 Supplemental
 Materials
Publishing(1)

 

Media,
 Licensing
and
Advertising(1) (2)

 

Overhead(1) (3)

 

Total
 Domestic

 

International(1)

 

Total

 

Nine months ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

February 28, 2013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

610.6

 

$

174.0

 

$

134.3

 

$

43.1

 

$

—

 

$

962.0

 

$

328.3

 

$

1,290.3

 

Bad debt expense

 

 

—

 

 

0.6

 

 

1.2

 

 

—

 

 

—

 

 

1.8

 

 

2.1

 

 

3.9

 

Depreciation and amortization(4)

 

 

12.1

 

 

0.9

 

 

1.0

 

 

0.3

 

 

31.0

 

 

45.3

 

 

4.0

 

 

49.3

 

Amortization(5)

 

 

11.0

 

 

16.2

 

 

5.7

 

 

2.3

 

 

—

 

 

35.2

 

 

1.3

 

 

36.5

 

Loss on leases and asset impairments

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

Segment operating income (loss)

 

 

3.6

 

 

26.6

 

 

4.6

 

 

(0.9

)

 

(37.7

)

 

(3.8

)

 

29.5

 

 

25.7

 

Segment assets at 2/28/2013

 

 

549.0

 

 

177.1

 

 

159.9

 

 

27.2

 

 

434.4

 

 

1,347.6

 

 

298.9

 

 

1,646.5

 

Goodwill at 2/28/2013

 

 

54.3

 

 

22.7

 

 

65.4

 

 

5.4

 

 

—

 

 

147.8

 

 

10.2

 

 

158.0

 

Expenditures for long-lived assets including royalty advances

 

 

39.1

 

 

28.0

 

 

6.9

 

 

4.8

 

 

25.9

 

 

104.7

 

 

8.6

 

 

113.3

 

Long-lived assets at 2/28/2013

 

 

170.2

 

 

111.8

 

 

90.2

 

 

13.6

 

 

241.5

 

 

627.3

 

 

68.4

 

 

695.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine months ended

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

February 29, 2012

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

739.3

 

$

202.0

 

$

142.6

 

$

49.0

 

$

—

 

$

1,132.9

 

$

337.4

 

$

1,470.3

 

Bad debt expense

 

 

3.2

 

 

1.0

 

 

1.3

 

 

—

 

 

—

 

 

5.5

 

 

2.3

 

 

7.8

 

Depreciation and amortization(4)

 

 

11.9

 

 

0.9

 

 

0.8

 

 

0.4

 

 

27.7

 

 

41.7

 

 

4.9

 

 

46.6

 

Amortization(5)

 

 

9.0

 

 

15.6

 

 

4.9

 

 

5.1

 

 

—

 

 

34.6

 

 

1.8

 

 

36.4

 

Loss on leases and asset impairments

 

 

0.5

 

 

—

 

 

—

 

 

—

 

 

6.2

 

 

6.7

 

 

0.3

 

 

7.0

 

Segment operating income (loss)

 

 

70.7

 

 

47.5

 

 

9.0

 

 

(3.3

)

 

(59.8

)

 

64.1

 

 

30.8

 

 

94.9

 

Segment assets at 2/29/2012

 

 

597.1

 

 

156.6

 

 

153.3

 

 

38.2

 

 

397.4

 

 

1,342.6

 

 

294.3

 

 

1,636.9

 

Goodwill at 2/29/2012

 

 

54.3

 

 

22.7

 

 

70.5

 

 

5.4

 

 

—

 

 

152.9

 

 

10.0

 

 

162.9

 

Expenditures for long-lived assets including royalty advances

 

 

32.8

 

 

18.0

 

 

9.3

 

 

5.3

 

 

22.0

 

 

87.4

 

 

9.0

 

 

96.4

 

Long-lived assets at 2/29/2012

 

 

173.7

 

 

98.5

 

 

88.3

 

 

19.7

 

 

242.8

 

 

623.0

 

 

67.6

 

 

690.6

 


 

 

(1)

As discussed under “Discontinued Operations” in Note 1, “Basis of Presentation,” the Company closed or sold several operations during fiscal 2009, fiscal 2010 and fiscal 2012, and presently holds for sale one facility. All of these businesses are classified as discontinued operations in the Company’s financial statements and, as such, are not reflected in this table.

 

 

(2)

As discussed under “Segment” in Note 1, a business previously reported in the Media, Licensing and Advertising segment is now included in the Children’s Book Publishing and Distribution segment.

 

 

(3)

Overhead includes all domestic corporate amounts not allocated to segments, including expenses and costs related to the management of corporate assets. Unallocated assets are principally comprised of deferred income taxes and property, plant and equipment related to the Company’s headquarters in the metropolitan New York area, its fulfillment and distribution facilities located in Missouri and its facility located in Connecticut.

 

 

(4)

Includes depreciation of property, plant and equipment and amortization of intangible assets.

 

 

(5)

Includes amortization of prepublication and production costs.