Sign In  |  Register  |  About Santa Clara  |  Contact Us

Santa Clara, CA
September 01, 2020 1:39pm
7-Day Forecast | Traffic
  • Search Hotels in Santa Clara

  • CHECK-IN:
  • CHECK-OUT:
  • ROOMS:

Graham Holdings Company Reports 2023 and Fourth Quarter Earnings

Graham Holdings Company (NYSE: GHC) today reported its financial results for the fourth quarter and full year of 2023. The Company also filed its Form 10-K today for the year ended December 31, 2023 with the Securities and Exchange Commission.

Division Operating Results

Revenue for 2023 was $4,414.9 million, up 12% from $3,924.5 million in 2022. Revenues increased at education, healthcare and automotive, partially offset by declines at television broadcasting, manufacturing and other businesses. The Company reported operating income for 2023 of $69.4 million, compared to $83.9 million in 2022. The decrease in operating results is due to goodwill impairment charges at World of Good Brands (WGB, formerly Leaf Media) and Dekko and declines at television broadcasting and manufacturing, partially offset by increases at education, healthcare and automotive, and reduced losses at other businesses due to goodwill and other long-lived asset impairment charges in 2022 at Society6 and Saatchi Art (both formerly included in Leaf Marketplace). The Company reported adjusted operating cash flow (non-GAAP) for 2023 of $338.3 million, compared to $377.6 million in 2022. Adjusted operating cash flow declined at television broadcasting, manufacturing and other businesses, partially offset by increases at education, healthcare and automotive.

For the fourth quarter of 2023, revenue was $1,166.8 million, up 10% from $1,064.0 million in 2022. Revenues increased at education, healthcare and automotive, partially offset by declines at television broadcasting, manufacturing and other businesses. The Company reported operating income of $40.8 million in the fourth quarter of 2023, compared to an operating loss of $54.9 million in 2022. The increase in operating results is due to goodwill and other long-lived asset impairment charges at Society6 and Saatchi Art in 2022 and increases at healthcare and automotive, partially offset by declines at education, television broadcasting and manufacturing. The Company reported adjusted operating cash flow (non-GAAP) for the fourth quarter of 2023 of $83.0 million, compared to $119.2 million in 2022. Adjusted operating cash flow declined at education, television broadcasting and manufacturing, partially offset by increases at healthcare and automotive.

Acquisitions and Dispositions of Businesses

There were no significant business acquisitions or dispositions during the fourth quarter of 2023.

Debt, Cash and Marketable Equity Securities

At December 31, 2023, the Company had $811.8 million in borrowings outstanding at an average interest rate of 6.4%, including $97.9 million outstanding on its $300 million revolving credit facility. Cash, marketable equity securities and other investments totaled $898.9 million at December 31, 2023.

At December 31, 2022, the Company had $726.4 million in borrowings outstanding at an average interest rate of 5.7%, including $200.2 million outstanding on its $300 million revolving credit facility. Cash, marketable equity securities and other investments totaled $812.8 million at December 31, 2022.

The Company recognized $24.6 million and $33.3 million in net gains on marketable equity securities in the fourth quarter of 2023 and 2022, respectively.

Common Stock Repurchases

During the fourth quarter of 2023, the Company purchased a total of 100,263 shares of its Class B common stock at a cost of $62.1 million. At December 31, 2023, there were 4,478,810 shares outstanding. On May 4, 2023, the Board of Directors authorized the Company to acquire up to 500,000 shares of Class B common stock; the Company has remaining authorization for 236,403 shares as of December 31, 2023.

Pension Plan

At December 31, 2023, the Company had a pension surplus of $2,113.6 million, reported in the Company’s Consolidated Balance Sheet as Prepaid Pension Cost, an increase from $1,658.0 million at December 31, 2022.

Overall Company Results

The Company reported net income attributable to common shares of $205.3 million ($43.82 per share) for the year ended December 31, 2023, compared to $67.1 million ($13.79 per share) for the year ended December 31, 2022. For the fourth quarter of 2023, the Company reported net income attributable to common shares of $53.3 million ($11.72 per share), compared to $6.2 million ($1.28 per share) for the same period of 2022.

The results for 2023 and 2022 were affected by a number of items as described in the Non-GAAP Financial Information schedule attached to this release. Excluding these items, net income attributable to common shares was $200.5 million ($42.78 per share) for 2023, compared to $287.2 million ($59.03 per share) for 2022. Excluding these items, net income attributable to common shares was $49.7 million ($10.94 per share) for the fourth quarter of 2023, compared to $90.5 million ($18.80 per share) for the fourth quarter of 2022.

* * * * * * * * * * * *

Additional Commentary on Fourth Quarter 2023 Results

Division Results

Education

For the fourth quarter of 2023, education division revenue totaled $395.5 million, up 9% from $361.8 million for the same period of 2022. Kaplan reported operating income for the fourth quarter of 2023 of $21.5 million, compared to $25.2 million in the fourth quarter of 2022.

Kaplan International revenue increased 16% in the fourth quarter of 2023 (11% on a constant currency basis). The increase is due largely to growth at Pathways and Australia. Kaplan International reported operating income of $23.3 million for the fourth quarter of 2023, a small decline from $23.9 million in 2022. The decrease is due to lower earnings at UK Professional and increased incentive compensation costs, partially offset by improved results at Australia and Singapore.

Higher Education revenue in the fourth quarter of 2023 was flat compared to the same period of 2022. Kaplan recorded $11.3 million in fees from Purdue Global in its Higher Education operating results for each of the fourth quarters of 2023 and 2022. Higher education results declined in the fourth quarter of 2023 due to increased other higher education development costs.

Supplemental Education revenue declined 3% in the fourth quarter of 2023, driven mostly by softness in Real Estate, Securities and Medical Licensure test preparation, offset in part by growth in CFP, CFA, Architecture and Engineering and MCAT test preparation and publishing activities. Operating results improved in the fourth quarter of 2023 due to savings from reduced headcount, partially offset by lower revenues.

In the fourth quarter of 2022, Kaplan implemented a Separation Incentive Program (SIP) to reduce the number of employees at Supplemental Education and Higher Education, which was funded by the assets of the Company’s pension plan. In connection with the SIP, the Company recorded $3.6 million in non-operating pension expense in the fourth quarter of 2022.

Kaplan corporate and other expenses increased in the fourth quarter of 2023 due to higher incentive compensation costs compared to the fourth quarter of 2022.

Television Broadcasting

For the fourth quarter of 2023, revenue decreased 19% to $124.6 million, from $154.7 million in 2022, due primarily to a $34.0 million decline in political advertising revenue as well as a small decline in retransmission revenues, partially offset by increased digital advertising revenues. Operating income for the fourth quarter of 2023 declined 43% to $40.2 million, from $70.0 million in the same period of 2022, due to reduced revenues and higher network fees.

Manufacturing

Manufacturing revenues decreased 14% in the fourth quarter of 2023 due to lower revenues at Hoover, Dekko and Joyce, partially offset by increased revenues at Forney. The revenue decline at Hoover is due to lower wood prices and a decrease in overall product demand, partially offset by increased rates. Revenues declined at Dekko due largely to lower product demand, particularly in the commercial office electrical products sector. In the fourth quarter of 2023, Hoover results included wood gains on inventory sales, compared to modest losses in the fourth quarter of 2022. Operating results were down in the fourth quarter of 2023 due to a decline in results at Hoover, Dekko and Joyce, partially offset by improved results at Forney.

Healthcare

Healthcare revenues increased 34% in the fourth quarter of 2023, largely due to significant growth at CSI and from businesses acquired in 2022, along with growth in home health and hospice services.

Graham Healthcare Group (GHG) recorded pension expense of $3.4 million related to the pension credit retention program in the fourth quarter of 2023. In the fourth quarter of 2022, GHG recorded pension expense of $10.5 million related to this program. Of this amount, $7.8 million related to the first three quarters of 2022; the Company concluded that this adjustment was not material to the Company’s operating results for the relevant interim periods. The improvement in GHG operating results in the fourth quarter of 2023 is due to higher pension expense in the fourth quarter of 2022 related to the GHG pension credit retention program and improved results at CSI, partially offset by increased net losses from newly acquired businesses and a decline in home health and hospice results. Adjusted operating cash flow (non-GAAP) at GHG increased to $12.7 million in the fourth quarter of 2023, from $10.5 million in the fourth quarter of 2022.

GHG recorded equity in earnings of $3.1 million and $2.9 million for the fourth quarter of 2023 and 2022, respectively, related to its interests in home health and hospice joint ventures.

Automotive

Revenues for the fourth quarter of 2023 increased due to the acquisition of the Toyota of Richmond dealership and sales growth at the other dealerships, except for the Jeep dealership, which had lower revenues due a decline in new vehicle sales, and a small revenue decline at CDJR. Operating results for the fourth quarter of 2023 improved due largely to the Toyota of Richmond acquisition, partially offset by declines at the Jeep and CDJR dealerships.

Other Businesses

A summary of revenue by category for other businesses:

 

 

Three Months Ended

 

 

 

 

December 31

 

%

(in thousands)

 

2023

 

 

2022

 

Change

Operating Revenues

 

 

 

 

 

 

Retail (1)

 

$

34,108

 

$

41,335

 

(17

)

Media (2)

 

 

28,131

 

 

30,449

 

(8

)

Specialty (3)

 

 

38,304

 

 

36,150

 

6

 

 

 

$

100,543

 

$

107,934

 

(7

)

____________

(1)

Includes Society6 and Saatchi Art (formerly Leaf Marketplace) and Framebridge

(2)

Includes WGB (formerly Leaf Media), Code3, Slate, Foreign Policy, Pinna and City Cast

(3)

Includes Clyde’s Restaurant Group, Decile and CyberVista

Overall, revenue from other businesses declined 7% in the fourth quarter of 2023. Retail revenue declined largely due to significantly lower revenue at Society6, partially offset by revenue growth at Framebridge and Saatchi Art. Media revenue declined due to lower revenue at WGB and Code3, partially offset by revenue growth at Slate, Foreign Policy and City Cast. Specialty revenue increased due to revenue growth at Clyde’s Restaurant Group (CRG). Excluding the former Leaf businesses, revenues from other businesses increased in the fourth quarter of 2023.

Operating results improved in the fourth quarter of 2023 due to the $129.0 million in impairment charges at the former Leaf businesses recorded in the fourth quarter of 2022. Excluding the impairment charges, operating results declined in the fourth quarter of 2023, due to increased losses at the former Leaf businesses and Framebridge, partially offset by improved results at Code3, Slate, Foreign Policy and CRG and a reduction in losses due to the sales of Pinna and CyberVista. In the fourth quarter of 2023, the former Leaf businesses continued to incur transition-related costs in connection with the overall restructuring of Leaf into three stand-alone businesses. Adjusted operating cash flow losses (non-GAAP) at other businesses declined slightly to $20.0 million in the fourth quarter of 2023, from $20.3 million in the fourth quarter of 2022.

In the fourth quarter of 2022, the former Leaf businesses recorded a net depreciation expense credit of $5.9 million that related to the period from June 2021 through September 30, 2022; the Company concluded that this adjustment was not material to the Company’s operating results for the relevant periods.

Equity in Losses of Affiliates

Overall, the Company recorded equity in losses of affiliates of $2.9 million for the fourth quarter of 2023, compared to $5.8 million for 2022. These amounts include $6.4 million and $9.0 million in net losses for 2023 and 2022, respectively, from affiliates whose operations are not managed by the Company.

Net Interest Expense

The Company incurred net interest expense of $23.0 million and $14.4 million for the fourth quarter of 2023 and 2022, respectively. The Company recorded interest expense of $8.7 million and $3.7 million in the fourth quarter of 2023 and 2022, respectively, to adjust the fair value of the mandatorily redeemable noncontrolling interest at GHG. Excluding these adjustments, the increase in net interest expense relates primarily to increased debt at the automotive dealerships and higher interest rates on the Company’s variable debt.

Non-Operating Pension and Postretirement Benefit Income, Net

The Company recorded net non-operating pension and postretirement benefit income of $36.5 million for the fourth quarter of 2023, compared to $45.9 million for the fourth quarter of 2022.

In the fourth quarter of 2023, the Company recorded $0.2 million in expenses related to a non-operating SIP at the television broadcasting division. In the fourth quarter of 2022, the Company recorded $3.6 million in expenses related to a non-operating SIP at the education division.

Other Non-Operating (Expense) Income

For the fourth quarter of 2023, the Company recorded other non-operating expense, net, of $3.4 million, compared to non-operating income, net, of $27.1 million for the fourth quarter of 2022. The 2023 amounts included $3.0 million in foreign currency losses; a $0.5 million impairment on a cost method investment, and other items; partially offset by $1.3 million in gains related to sales of businesses and contingent consideration. The 2022 amounts included a non-cash gain of $18.4 million on the sale of CyberVista; a $6.3 million increase in the fair value of cost method investments; a $2.3 million gain on sale of a cost method investment; $1.3 million in gains related to sales of businesses and contingent consideration and other items; partially offset by a $1.3 million impairment on a cost method investment and other items.

Earnings Per Share

The calculation of diluted earnings per share for the fourth quarter of 2023 was based on 4,515,022 weighted average shares outstanding compared to 4,785,904 for the fourth quarter of 2022.

Forward-Looking Statements

All public statements made by the Company and its representatives that are not statements of historical fact, including certain statements in this press release, in the Company’s Annual Report on Form 10-K and in the Company’s 2023 Annual Report to Stockholders, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on expectations, forecasts, and assumptions by the Company’s management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ from those stated, including, without limitation, comments about expectations related to acquisitions or dispositions or related business activities, the Company’s business strategies and objectives, the prospects for growth in the Company’s various business operations, the Company’s future financial performance, and the risks and uncertainties described in Item 1A of the Company’s Annual Report on Form 10-K. Accordingly, undue reliance should not be placed on any forward-looking statement made by or on behalf of the Company. The Company assumes no obligation to update any forward-looking statement after the date on which such statement is made, even if new information subsequently becomes available.

GRAHAM HOLDINGS COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

 

Three Months Ended

 

 

December 31

%

(in thousands, except per share amounts)

 

2023

 

 

 

2022

 

Change

Operating revenues

$

1,166,813

 

 

$

1,064,032

 

10

 

Operating expenses

 

1,092,258

 

 

 

960,808

 

14

 

Depreciation of property, plant and equipment

 

22,729

 

 

 

14,752

 

54

 

Amortization of intangible assets

 

11,032

 

 

 

14,415

 

(23

)

Impairment of goodwill and other long-lived assets

 

 

 

 

128,990

 

 

Operating income (loss)

 

40,794

 

 

 

(54,933

)

 

Equity in losses of affiliates, net

 

(2,938

)

 

 

(5,757

)

(49

)

Interest income

 

2,384

 

 

 

1,012

 

 

Interest expense

 

(25,423

)

 

 

(15,434

)

65

 

Non-operating pension and postretirement benefit income, net

 

36,499

 

 

 

45,876

 

(20

)

Gain on marketable equity securities, net

 

24,638

 

 

 

33,289

 

(26

)

Other (expense) income, net

 

(3,364

)

 

 

27,090

 

 

Income before income taxes

 

72,590

 

 

 

31,143

 

 

Provision for income taxes

 

16,900

 

 

 

24,500

 

(31

)

Net income

 

55,690

 

 

 

6,643

 

 

Net income attributable to noncontrolling interests

 

(2,431

)

 

 

(483

)

 

Net Income Attributable to Graham Holdings Company Common Stockholders

$

53,259

 

 

$

6,160

 

 

Per Share Information Attributable to Graham Holdings Company Common Stockholders

 

 

 

 

Basic net income per common share

$

11.76

 

 

$

1.28

 

 

Basic average number of common shares outstanding

 

4,498

 

 

 

4,771

 

 

Diluted net income per common share

$

11.72

 

 

$

1.28

 

 

Diluted average number of common shares outstanding

 

4,515

 

 

 

4,786

 

 

GRAHAM HOLDINGS COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

 

Twelve Months Ended

 

 

December 31

%

(in thousands, except per share amounts)

 

2023

 

 

 

2022

 

Change

Operating revenues

$

4,414,877

 

 

$

3,924,493

 

12

 

Operating expenses

 

4,110,315

 

 

 

3,579,457

 

15

 

Depreciation of property, plant and equipment

 

86,064

 

 

 

73,297

 

17

 

Amortization of intangible assets

 

50,039

 

 

 

58,851

 

(15

)

Impairment of goodwill and other long-lived assets

 

99,066

 

 

 

128,990

 

(23

)

Operating income

 

69,393

 

 

 

83,898

 

(17

)

Equity in losses of affiliates, net

 

(5,183

)

 

 

(2,837

)

83

 

Interest income

 

7,122

 

 

 

3,226

 

 

Interest expense

 

(63,301

)

 

 

(54,403

)

16

 

Non-operating pension and postretirement benefit income, net

 

133,812

 

 

 

197,939

 

(32

)

Gain (loss) on marketable equity securities, net

 

138,067

 

 

 

(139,589

)

 

Other income, net

 

19,094

 

 

 

33,500

 

(43

)

Income before income taxes

 

299,004

 

 

 

121,734

 

 

Provision for income taxes

 

87,300

 

 

 

51,300

 

70

 

Net income

 

211,704

 

 

 

70,434

 

 

Net income attributable to noncontrolling interests

 

(6,416

)

 

 

(3,355

)

91

 

Net Income Attributable to Graham Holdings Company Common Stockholders

$

205,288

 

 

$

67,079

 

 

Per Share Information Attributable to Graham Holdings Company Common Stockholders

 

 

 

 

Basic net income per common share

$

43.96

 

 

$

13.83

 

 

Basic average number of common shares outstanding

 

4,639

 

 

 

4,823

 

 

Diluted net income per common share

$

43.82

 

 

$

13.79

 

 

Diluted average number of common shares outstanding

 

4,654

 

 

 

4,836

 

 

GRAHAM HOLDINGS COMPANY

BUSINESS DIVISION INFORMATION

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Twelve Months Ended

 

 

 

 

December 31

 

%

 

December 31

 

%

(in thousands)

 

2023

 

 

 

2022

 

 

Change

 

 

2023

 

 

 

2022

 

 

Change

Operating Revenues

 

 

 

 

 

 

 

Education

$

395,476

$

361,826

 

9

 

$

1,587,581

 

$

1,427,915

 

11

 

Television broadcasting

 

 

124,618

 

 

 

154,681

 

 

(19

)

 

 

472,436

 

 

 

535,651

 

 

(12

)

Manufacturing

 

 

104,028

 

 

 

120,677

 

 

(14

)

 

 

447,910

 

 

 

486,643

 

 

(8

)

Healthcare

 

 

127,976

 

 

 

95,184

 

 

34

 

 

 

459,481

 

 

 

326,000

 

 

41

 

Automotive

 

 

314,642

 

 

 

224,220

 

 

40

 

 

 

1,079,893

 

 

 

734,185

 

 

47

 

Other businesses

 

 

100,543

 

 

 

107,934

 

 

(7

)

 

 

369,653

 

 

 

416,084

 

 

(11

)

Corporate office

 

 

365

 

 

 

 

 

 

 

 

1,580

 

 

 

 

 

 

Intersegment elimination

 

 

(835

)

 

 

(490

)

 

 

 

 

(3,657

)

 

 

(1,985

)

 

 

 

 

$

1,166,813

 

 

$

1,064,032

 

 

10

 

 

$

4,414,877

 

 

$

3,924,493

 

 

12

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

Education

 

$

374,020

 

 

$

336,655

 

 

11

 

 

$

1,483,110

 

 

$

1,344,982

 

 

10

 

Television broadcasting

 

 

84,400

 

 

 

84,713

 

 

0

 

 

 

338,498

 

 

 

333,772

 

 

1

 

Manufacturing

 

 

99,157

 

 

 

111,094

 

 

(11

)

 

 

464,703

 

 

 

452,936

 

 

3

 

Healthcare

 

 

121,415

 

 

 

98,588

 

 

23

 

 

 

435,636

 

 

 

310,735

 

 

40

 

Automotive

 

 

303,924

 

 

 

215,080

 

 

41

 

 

 

1,040,635

 

 

 

699,552

 

 

49

 

Other businesses

 

 

127,854

 

 

 

258,045

 

 

(50

)

 

 

529,379

 

 

 

644,437

 

 

(18

)

Corporate office

 

 

16,084

 

 

 

15,280

 

 

5

 

 

 

57,180

 

 

 

56,166

 

 

2

 

Intersegment elimination

 

 

(835

)

 

 

(490

)

 

 

 

 

(3,657

)

 

 

(1,985

)

 

 

 

 

$

1,126,019

 

 

$

1,118,965

 

 

1

 

 

$

4,345,484

 

 

$

3,840,595

 

 

13

 

Operating Income (Loss)

 

 

 

 

 

 

 

 

 

 

 

Education

 

$

21,456

 

 

$

25,171

 

 

(15

)

 

$

104,471

 

 

$

82,933

 

 

26

 

Television broadcasting

 

 

40,218

 

 

 

69,968

 

 

(43

)

 

 

133,938

 

 

 

201,879

 

 

(34

)

Manufacturing

 

 

4,871

 

 

 

9,583

 

 

(49

)

 

 

(16,793

)

 

 

33,707

 

 

 

Healthcare

 

 

6,561

 

 

 

(3,404

)

 

 

 

 

23,845

 

 

 

15,265

 

 

56

 

Automotive

 

 

10,718

 

 

 

9,140

 

 

17

 

 

 

39,258

 

 

 

34,633

 

 

13

 

Other businesses

 

 

(27,311

)

 

 

(150,111

)

 

82

 

 

 

(159,726

)

 

 

(228,353

)

 

30

 

Corporate office

 

 

(15,719

)

 

 

(15,280

)

 

(3

)

 

 

(55,600

)

 

 

(56,166

)

 

1

 

 

 

$

40,794

 

 

$

(54,933

)

 

 

 

$

69,393

 

 

$

83,898

 

 

(17

)

Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets

 

 

 

 

 

 

 

 

 

 

 

 

Education

 

$

2,943

 

 

$

3,980

 

 

(26

)

 

$

14,553

 

 

$

16,170

 

 

(10

)

Television broadcasting

 

 

1,362

 

 

 

1,360

 

 

0

 

 

 

5,450

 

 

 

5,440

 

 

0

 

Manufacturing

 

 

3,120

 

 

 

4,969

 

 

(37

)

 

 

63,803

 

 

 

20,372

 

 

 

Healthcare

 

 

973

 

 

 

954

 

 

2

 

 

 

3,675

 

 

 

3,776

 

 

(3

)

Automotive

 

 

10

 

 

 

 

 

 

 

 

13

 

 

 

 

 

 

Other businesses

 

 

2,624

 

 

 

132,142

 

 

(98

)

 

 

61,611

 

 

 

142,083

 

 

(57

)

Corporate office

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

$

11,032

 

 

$

143,405

 

 

(92

)

 

$

149,105

 

 

$

187,841

 

 

(21

)

Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets

 

 

 

 

 

 

 

 

 

 

 

Education

 

$

24,399

 

 

$

29,151

 

 

(16

)

 

$

119,024

 

 

$

99,103

 

 

20

 

Television broadcasting

 

 

41,580

 

 

 

71,328

 

 

(42

)

 

 

139,388

 

 

 

207,319

 

 

(33

)

Manufacturing

 

 

7,991

 

 

 

14,552

 

 

(45

)

 

 

47,010

 

 

 

54,079

 

 

(13

)

Healthcare

 

 

7,534

 

 

 

(2,450

)

 

 

 

 

27,520

 

 

 

19,041

 

 

45

 

Automotive

 

 

10,728

 

 

 

9,140

 

 

17

 

 

 

39,271

 

 

 

34,633

 

 

13

 

Other businesses

 

 

(24,687

)

 

 

(17,969

)

 

(37

)

 

 

(98,115

)

 

 

(86,270

)

 

(14

)

Corporate office

 

 

(15,719

)

 

 

(15,280

)

 

(3

)

 

 

(55,600

)

 

 

(56,166

)

 

1

 

 

 

$

51,826

 

 

$

88,472

 

 

(41

)

 

$

218,498

 

 

$

271,739

 

 

(20

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Twelve Months Ended

 

 

 

 

December 31

 

%

 

December 31

 

%

(in thousands)

 

2023

 

 

 

2022

 

 

Change

 

 

2023

 

 

 

2022

 

 

Change

Depreciation

 

 

 

 

 

 

 

 

 

 

 

Education

 

$

9,759

 

 

$

8,718

 

 

12

 

 

$

38,187

 

 

$

34,114

 

 

12

 

Television broadcasting

 

 

2,981

 

 

 

2,959

 

 

1

 

 

 

12,224

 

 

 

12,294

 

 

(1

)

Manufacturing

 

 

2,496

 

 

 

2,290

 

 

9

 

 

 

9,453

 

 

 

9,399

 

 

1

 

Healthcare

 

 

1,673

 

 

 

2,326

 

 

(28

)

 

 

5,475

 

 

 

3,781

 

 

45

 

Automotive

 

 

1,612

 

 

 

1,113

 

 

45

 

 

 

5,177

 

 

 

3,709

 

 

40

 

Other businesses

 

 

4,059

 

 

 

(2,806

)

 

 

 

 

14,941

 

 

 

9,392

 

 

59

 

Corporate office

 

 

149

 

 

 

152

 

 

(2

)

 

 

607

 

 

 

608

 

 

0

 

 

 

$

22,729

 

 

$

14,752

 

 

54

 

 

$

86,064

 

 

$

73,297

 

 

17

 

Pension Expense

 

 

 

 

 

 

 

 

 

 

 

Education

 

$

2,227

 

 

$

2,234

 

 

0

 

 

$

8,907

 

 

$

8,934

 

 

0

 

Television broadcasting

 

 

833

 

 

 

888

 

 

(6

)

 

 

3,331

 

 

 

3,554

 

 

(6

)

Manufacturing

 

 

279

 

 

 

276

 

 

1

 

 

 

1,115

 

 

 

1,104

 

 

1

 

Healthcare

 

 

3,520

 

 

 

10,591

 

 

(67

)

 

 

14,083

 

 

 

11,008

 

 

28

 

Automotive

 

 

9

 

 

 

5

 

 

80

 

 

 

35

 

 

 

22

 

 

59

 

Other businesses

 

 

661

 

 

 

524

 

 

26

 

 

 

2,508

 

 

 

2,073

 

 

21

 

Corporate office

 

 

952

 

 

 

1,468

 

 

(35

)

 

 

3,808

 

 

 

5,872

 

 

(35

)

 

 

$

8,481

 

 

$

15,986

 

 

(47

)

 

$

33,787

 

 

$

32,567

 

 

4

 

Adjusted Operating Cash Flow (non-GAAP)(1)

 

 

 

 

 

 

 

 

 

 

 

Education

 

$

36,385

 

 

$

40,103

 

 

(9

)

 

$

166,118

 

 

$

142,151

 

 

17

 

Television broadcasting

 

 

45,394

 

 

 

75,175

 

 

(40

)

 

 

154,943

 

 

 

223,167

 

 

(31

)

Manufacturing

 

 

10,766

 

 

 

17,118

 

 

(37

)

 

 

57,578

 

 

 

64,582

 

 

(11

)

Healthcare

 

 

12,727

 

 

 

10,467

 

 

22

 

 

 

47,078

 

 

 

33,830

 

 

39

 

Automotive

 

 

12,349

 

 

 

10,258

 

 

20

 

 

 

44,483

 

 

 

38,364

 

 

16

 

Other businesses

 

 

(19,967

)

 

 

(20,251

)

 

1

 

 

 

(80,666

)

 

 

(74,805

)

 

(8

)

Corporate office

 

 

(14,618

)

 

 

(13,660

)

 

(7

)

 

 

(51,185

)

 

 

(49,686

)

 

(3

)

 

 

$

83,036

 

 

$

119,210

 

 

(30

)

 

$

338,349

 

 

$

377,603

 

 

(10

)

____________

(1)

Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets plus Depreciation Expense and Pension Expense.

GRAHAM HOLDINGS COMPANY

EDUCATION DIVISION INFORMATION

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

Twelve Months Ended

 

 

 

 

December 31

 

%

 

December 31

 

%

(in thousands)

 

 

2023

 

 

 

2022

 

 

Change

 

 

2023

 

 

 

2022

 

 

Change

Operating Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Kaplan international

 

$

252,164

 

 

$

217,770

 

 

16

 

 

$

966,879

 

 

$

816,239

 

 

18

 

Higher education

 

 

76,404

 

 

 

76,417

 

 

0

 

 

 

326,961

 

 

 

310,407

 

 

5

 

Supplemental education

 

 

66,241

 

 

 

68,209

 

 

(3

)

 

 

292,776

 

 

 

301,625

 

 

(3

)

Kaplan corporate and other

 

 

2,652

 

 

 

2,439

 

 

9

 

 

 

11,012

 

 

 

9,853

 

 

12

 

Intersegment elimination

 

 

(1,985

)

 

 

(3,009

)

 

 

 

 

(10,047

)

 

 

(10,209

)

 

 

 

 

$

395,476

 

 

$

361,826

 

 

9

 

 

$

1,587,581

 

 

$

1,427,915

 

 

11

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

Kaplan international

 

$

228,906

 

 

$

193,834

 

 

18

 

 

$

879,349

 

 

$

744,173

 

 

18

 

Higher education

 

 

70,805

 

 

 

69,021

 

 

3

 

 

 

288,019

 

 

 

285,588

 

 

1

 

Supplemental education

 

 

60,761

 

 

 

64,811

 

 

(6

)

 

 

270,304

 

 

 

280,556

 

 

(4

)

Kaplan corporate and other

 

 

12,469

 

 

 

7,807

 

 

60

 

 

 

40,903

 

 

 

28,659

 

 

43

 

Amortization of intangible assets

 

 

2,943

 

 

 

3,980

 

 

(26

)

 

 

14,076

 

 

 

16,170

 

 

(13

)

Impairment of long-lived assets

 

 

 

 

 

 

 

 

 

 

477

 

 

 

 

 

 

Intersegment elimination

 

 

(1,864

)

 

 

(2,798

)

 

 

 

 

(10,018

)

 

 

(10,164

)

 

 

 

 

$

374,020

 

 

$

336,655

 

 

11

 

 

$

1,483,110

 

 

$

1,344,982

 

 

10

 

Operating Income (Loss)

 

 

 

 

 

 

 

 

 

 

 

 

Kaplan international

 

$

23,258

 

 

$

23,936

 

 

(3

)

 

$

87,530

 

 

$

72,066

 

 

21

 

Higher education

 

 

5,599

 

 

 

7,396

 

 

(24

)

 

 

38,942

 

 

 

24,819

 

 

57

 

Supplemental education

 

 

5,480

 

 

 

3,398

 

 

61

 

 

 

22,472

 

 

 

21,069

 

 

7

 

Kaplan corporate and other

 

 

(9,817

)

 

 

(5,368

)

 

(83

)

 

 

(29,891

)

 

 

(18,806

)

 

(59

)

Amortization of intangible assets

 

 

(2,943

)

 

 

(3,980

)

 

26

 

 

 

(14,076

)

 

 

(16,170

)

 

13

 

Impairment of long-lived assets

 

 

 

 

 

 

 

 

 

 

(477

)

 

 

 

 

 

Intersegment elimination

 

 

(121

)

 

 

(211

)

 

 

 

 

(29

)

 

 

(45

)

 

 

 

 

$

21,456

 

 

$

25,171

 

 

(15

)

 

$

104,471

 

 

$

82,933

 

 

26

 

Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets

 

 

 

 

 

 

 

 

 

 

 

Kaplan international

 

$

23,258

 

 

$

23,936

 

 

(3

)

 

$

87,530

 

 

$

72,066

 

 

21

 

Higher education

 

 

5,599

 

 

 

7,396

 

 

(24

)

 

 

38,942

 

 

 

24,819

 

 

57

 

Supplemental education

 

 

5,480

 

 

 

3,398

 

 

61

 

 

 

22,472

 

 

 

21,069

 

 

7

 

Kaplan corporate and other

 

 

(9,817

)

 

 

(5,368

)

 

(83

)

 

 

(29,891

)

 

 

(18,806

)

 

(59

)

Intersegment elimination

 

 

(121

)

 

 

(211

)

 

 

 

 

(29

)

 

 

(45

)

 

 

 

 

$

24,399

 

 

$

29,151

 

 

(16

)

 

$

119,024

 

 

$

99,103

 

 

20

 

Depreciation

 

 

 

 

 

 

 

 

 

 

 

 

Kaplan international

 

$

7,669

 

 

$

6,012

 

 

28

 

 

$

28,501

 

 

$

23,270

 

 

22

 

Higher education

 

 

985

 

 

 

1,117

 

 

(12

)

 

 

4,416

 

 

 

4,373

 

 

1

 

Supplemental education

 

 

1,078

 

 

 

1,557

 

 

(31

)

 

 

5,165

 

 

 

6,344

 

 

(19

)

Kaplan corporate and other

 

 

27

 

 

 

32

 

 

(16

)

 

 

105

 

 

 

127

 

 

(17

)

 

 

$

9,759

 

 

$

8,718

 

 

12

 

 

$

38,187

 

 

$

34,114

 

 

12

 

Pension Expense

 

 

 

 

 

 

 

 

 

 

 

 

Kaplan international

 

$

81

 

 

$

68

 

 

19

 

 

$

325

 

 

$

270

 

 

20

 

Higher education

 

 

934

 

 

 

980

 

 

(5

)

 

 

3,737

 

 

 

3,842

 

 

(3

)

Supplemental education

 

 

1,037

 

 

 

1,008

 

 

3

 

 

 

4,147

 

 

 

4,114

 

 

1

 

Kaplan corporate and other

 

 

175

 

 

 

178

 

 

(2

)

 

 

698

 

 

 

708

 

 

(1

)

 

 

$

2,227

 

 

$

2,234

 

 

0

 

 

$

8,907

 

 

$

8,934

 

 

0

 

Adjusted Operating Cash Flow (non-GAAP)(1)

 

 

 

 

 

 

 

 

 

 

 

Kaplan international

 

$

31,008

 

 

$

30,016

 

 

3

 

 

$

116,356

 

 

$

95,606

 

 

22

 

Higher education

 

 

7,518

 

 

 

9,493

 

 

(21

)

 

 

47,095

 

 

 

33,034

 

 

43

 

Supplemental education

 

 

7,595

 

 

 

5,963

 

 

27

 

 

 

31,784

 

 

 

31,527

 

 

1

 

Kaplan corporate and other

 

 

(9,615

)

 

 

(5,158

)

 

(86

)

 

 

(29,088

)

 

 

(17,971

)

 

(62

)

Intersegment elimination

 

 

(121

)

 

 

(211

)

 

 

 

 

(29

)

 

 

(45

)

 

 

 

 

$

36,385

 

 

$

40,103

 

 

(9

)

 

$

166,118

 

 

$

142,151

 

 

17

 

____________

(1)

Adjusted Operating Cash Flow (non-GAAP) is calculated as Operating Income (Loss) before Amortization of Intangible Assets and Impairment of Long-Lived Assets plus Depreciation Expense and Pension Expense.

NON-GAAP FINANCIAL INFORMATION

GRAHAM HOLDINGS COMPANY

(Unaudited)

In addition to the results reported in accordance with accounting principles generally accepted in the United States (GAAP) included in this press release, the Company has provided information regarding Adjusted Operating Cash Flow and Net income excluding certain items described below, reconciled to the most directly comparable GAAP measures. Management believes that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering:

  • the ability to make meaningful period-to-period comparisons of the Company’s ongoing results;
  • the ability to identify trends in the Company’s underlying business; and
  • a better understanding of how management plans and measures the Company’s underlying business.

Adjusted Operating Cash Flow and Net income, excluding certain items, should not be considered substitutes or alternatives to computations calculated in accordance with and required by GAAP. These non-GAAP financial measures should be read only in conjunction with financial information presented on a GAAP basis.

The gains and losses on marketable equity securities relate to the change in the fair value (quoted prices) of its portfolio of equity securities. The mandatorily redeemable noncontrolling interest represents the ownership portion of a group of minority shareholders at a subsidiary of the Company's Healthcare business. The Company measures the redemption value of this minority ownership on a quarterly basis with changes in the fair value recorded as interest expense or income, which is included in net income for the period. The effect of gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest are not directly related to the core performance of the Company’s business operations since these items do not directly relate to the sale of the Company’s services or products. The accounting principles generally accepted in the United States (“GAAP”) require that the Company include the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest in net income on the Statement of Operations. The Company excludes the gains and losses on marketable equity securities and net interest expense related to fair value adjustments of the mandatorily redeemable noncontrolling interest from the non-GAAP adjusted net income because these items are independent of the Company’s core operations and not indicative of the performance of the Company’s business operations.

The following tables reconcile the non-GAAP financial measures for Net income, excluding certain items, to the most directly comparable GAAP measures:

 

Three Months Ended December 31

 

2023

 

2022

(in thousands, except per share amounts)

Income

before

income

taxes

 

Income

Taxes

 

Net

Income

 

Income

before

income

taxes

 

Income

Taxes

 

Net

Income

Amounts attributable to Graham Holdings Company Common Stockholders

 

 

 

 

 

 

 

 

 

 

 

As reported

$

72,590

 

 

$

16,900

 

 

$

55,690

 

 

$

31,143

 

 

$

24,500

 

 

$

6,643

 

Attributable to noncontrolling interests

 

 

 

 

 

(2,431

)

 

 

 

 

 

 

(483

)

Attributable to Graham Holdings Company Stockholders

 

 

 

 

 

53,259

 

 

 

 

 

 

 

6,160

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

Net credit related to fair value changes in contingent consideration from prior acquisitions

 

(2,267

)

 

 

(330

)

 

 

(1,937

)

 

 

(1,317

)

 

 

(10

)

 

 

(1,307

)

Goodwill and other long-lived asset impairment charges

 

 

 

 

(3,874

)

 

 

3,874

 

 

 

128,990

 

 

 

11,953

 

 

 

117,037

 

Charges related to non-operating Separation Incentive Programs

 

240

 

 

 

61

 

 

 

179

 

 

 

3,624

 

 

 

915

 

 

 

2,709

 

Net gains on marketable equity securities

 

(24,639

)

 

 

(5,491

)

 

 

(19,148

)

 

 

(33,289

)

 

 

(8,266

)

 

 

(25,023

)

Net losses of affiliates whose operations are not managed by the Company

 

6,391

 

 

 

1,637

 

 

 

4,754

 

 

 

9,026

 

 

 

2,386

 

 

 

6,640

 

Gain on sale of CyberVista

 

 

 

 

 

 

 

 

 

 

(18,355

)

 

 

(4,832

)

 

 

(13,523

)

Non-operating loss (gain), net, from write-ups, sales and impairments of cost and equity method investments

 

500

 

 

 

111

 

 

 

389

 

 

 

(7,268

)

 

 

(1,889

)

 

 

(5,379

)

Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest

 

8,701

 

 

 

377

 

 

 

8,324

 

 

 

3,690

 

 

 

537

 

 

 

3,153

 

Net Income, adjusted (non-GAAP)

 

 

 

 

$

49,694

 

 

 

 

 

 

$

90,467

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share information attributable to Graham Holdings Company Common Stockholders

 

 

 

 

 

 

 

 

 

 

 

Diluted income per common share, as reported

 

 

 

 

$

11.72

 

 

 

 

 

 

$

1.28

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

Net credit related to fair value changes in contingent consideration from prior acquisitions

 

 

 

 

 

(0.43

)

 

 

 

 

 

 

(0.27

)

Goodwill and other long-lived asset impairment charges

 

 

 

 

 

0.85

 

 

 

 

 

 

 

24.32

 

Charges related to non-operating Separation Incentive Programs

 

 

 

 

 

0.04

 

 

 

 

 

 

 

0.56

 

Net gains on marketable equity securities

 

 

 

 

 

(4.21

)

 

 

 

 

 

 

(5.20

)

Net losses of affiliates whose operations are not managed by the Company

 

 

 

 

 

1.05

 

 

 

 

 

 

 

1.38

 

Gain on sale of CyberVista

 

 

 

 

 

 

 

 

 

 

 

 

(2.81

)

Non-operating loss (gain), net, from write-ups, sales and impairments of cost and equity method investments

 

 

 

 

 

0.09

 

 

 

 

 

 

 

(1.12

)

Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest

 

 

 

 

 

1.83

 

 

 

 

 

 

 

0.66

 

Diluted income per common share, adjusted (non-GAAP)

 

 

 

 

$

10.94

 

 

 

 

 

 

$

18.80

 

 

 

 

 

 

 

 

 

 

 

 

 

The adjusted diluted per share amounts may not compute due to rounding.

 

Twelve Months Ended December 31

 

2023

 

2022

(in thousands, except per share amounts)

Income

before

income

taxes

 

Income

Taxes

 

Net

Income

 

Income

before

income

taxes

 

Income

Taxes

 

Net

Income

Amounts attributable to Graham Holdings Company Common Stockholders

 

 

 

 

 

 

 

 

 

 

 

As reported

$

299,004

 

 

$

87,300

 

 

$

211,704

 

 

$

121,734

 

 

$

51,300

 

 

$

70,434

 

Attributable to noncontrolling interests

 

 

 

 

 

(6,416

)

 

 

 

 

 

 

(3,355

)

Attributable to Graham Holdings Company Stockholders

 

 

 

 

$

205,288

 

 

 

 

 

 

$

67,079

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

Net credit related to fair value changes in contingent consideration from prior acquisitions

 

(6,955

)

 

 

(473

)

 

 

(6,482

)

 

 

(6,113

)

 

 

(34

)

 

 

(6,079

)

Goodwill and other long-lived asset impairment charges

 

99,066

 

 

 

10,204

 

 

 

88,862

 

 

 

128,990

 

 

 

11,953

 

 

 

117,037

 

Charges related to non-operating Separation Incentive Programs

 

9,886

 

 

 

2,542

 

 

 

7,344

 

 

 

3,624

 

 

 

915

 

 

 

2,709

 

Net (gains) losses on marketable equity securities

 

(138,067

)

 

 

(35,351

)

 

 

(102,716

)

 

 

139,589

 

 

 

36,747

 

 

 

102,842

 

Net losses of affiliates whose operations are not managed by the Company

 

16,047

 

 

 

4,178

 

 

 

11,869

 

 

 

11,832

 

 

 

3,115

 

 

 

8,717

 

Gain on sale of Pinna and CyberVista

 

(10,033

)

 

 

(2,641

)

 

 

(7,392

)

 

 

(18,355

)

 

 

(4,832

)

 

 

(13,523

)

Non-operating gain, net, from write-ups, sales and impairments of cost and equity method investments

 

(3,435

)

 

 

(896

)

 

 

(2,539

)

 

 

(9,507

)

 

 

(2,456

)

 

 

(7,051

)

Credit to interest expense resulting from gains realized related to the termination of interest rate swaps

 

(4,581

)

 

 

(1,252

)

 

 

(3,329

)

 

 

 

 

 

 

 

 

 

Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest

 

10,122

 

 

 

529

 

 

 

9,593

 

 

 

16,489

 

 

 

1,068

 

 

 

15,421

 

Net Income, adjusted (non-GAAP)

 

 

 

 

$

200,498

 

 

 

 

 

 

$

287,152

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share information attributable to Graham Holdings Company Common Stockholders

 

 

 

 

 

 

 

 

 

 

 

Diluted income per common share, as reported

 

 

 

 

$

43.82

 

 

 

 

 

 

$

13.79

 

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

Net credit related to fair value changes in contingent consideration from prior acquisitions

 

 

 

 

 

(1.38

)

 

 

 

 

 

 

(1.25

)

Goodwill and other long-lived asset impairment charges

 

 

 

 

 

18.97

 

 

 

 

 

 

 

24.06

 

Charges related to non-operating Separation Incentive Programs

 

 

 

 

 

1.57

 

 

 

 

 

 

 

0.56

 

Net (gains) losses on marketable equity securities

 

 

 

 

 

(21.93

)

 

 

 

 

 

 

21.14

 

Net losses of affiliates whose operations are not managed by the Company

 

 

 

 

 

2.53

 

 

 

 

 

 

 

1.79

 

Gain on sale of Pinna and CyberVista

 

 

 

 

 

(1.59

)

 

 

 

 

 

 

(2.78

)

Non-operating gain, net, from write-ups, sales and impairments of cost and equity method investments

 

 

 

 

 

(0.54

)

 

 

 

 

 

 

(1.45

)

Credit to interest expense resulting from gains realized related to the termination of interest rate swaps

 

 

 

 

 

(0.72

)

 

 

 

 

 

 

 

Interest expense related to the fair value adjustment of the mandatorily redeemable noncontrolling interest

 

 

 

 

 

2.05

 

 

 

 

 

 

 

3.17

 

Diluted income per common share, adjusted (non-GAAP)

 

 

 

 

$

42.78

 

 

 

 

 

 

$

59.03

 

 

 

 

 

 

 

 

 

 

 

 

 

The adjusted diluted per share amounts may not compute due to rounding.

 

Contacts

Wallace R. Cooney

(703) 345-6470

Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
 
 
Copyright © 2010-2020 SantaClara.com & California Media Partners, LLC. All rights reserved.