CAMBIUM LEARNING GROUP, INC.

CIK:0001466815|SEC Filings

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Net revenues	$ 44,734	$ 43,523	$ 122,337	$ 119,855
Cost of revenues:
Cost of revenues	7,801	7,928	20,902	21,328
Amortization expense	4,200	4,676	12,147	13,094
Total cost of revenues	12,001	12,604	33,049	34,422
Research and development expense	4,059	3,352	11,678	9,744
Sales and marketing expense	12,283	12,771	37,803	37,871
General and administrative expense	5,962	5,457	17,378	15,240
Shipping and handling costs	323	414	630	727
Depreciation and amortization expense	721	670	2,156	2,020
Total costs and expenses	35,349	35,268	102,694	100,024
Income before interest and income taxes	9,385	8,255	19,643	19,831
Net interest expense	(897)	(1,271)	(2,654)	(3,834)
Other income (expense), net	(103)	(108)	(88)	(325)
Income before income taxes	8,385	6,876	16,901	15,672
Income tax expense	(2,508)	(399)	(3,982)	(873)
Net income	5,877	6,477	12,919	14,799
Other comprehensive income:
Amortization of net pension loss	36	23	107	69
Comprehensive income	$ 5,913	$ 6,500	$ 13,026	$ 14,868
Net income per common share:
Basic (in USD per share)	$ 0.12	$ 0.14	$ 0.27	$ 0.32
Diluted (in USD per share)	$ 0.12	$ 0.14	$ 0.27	$ 0.31
Average number of common shares and equivalents outstanding:
Basic (shares)	47,273	46,460	47,116	46,316
Diluted (shares)	48,503	47,629	48,351	47,522

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Statement of Cash Flows [Abstract]
Net income	$ 12,919	$ 14,799
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense	14,303	15,114
Deferred income taxes	3,318	0
Amortization of note discount and deferred financing costs	405	607
Stock-based compensation and expense	728	641
Other	(5)	14
Changes in operating assets and liabilities:
Accounts receivable, net	(13,459)	(17,311)
Inventory	687	375
Other current assets	(2,528)	(277)
Other assets	(463)	(786)
Restricted assets	678	776
Accounts payable	(44)	945
Accrued expenses	4,267	3,595
Deferred revenue	12,887	7,646
Other long-term liabilities	(451)	(568)
Net cash provided by operating activities	33,242	25,570
Investing activities:
Expenditures for property, equipment, software and pre-publication costs	(12,056)	(13,912)
Net cash used in investing activities	(12,056)	(13,912)
Financing activities:
Repayment of debt	(4,512)	(5,261)
Borrowings under revolving credit facility	11,000	16,000
Payments of revolving credit facility	(11,000)	(16,000)
Proceeds from exercise of stock options	1,088	766
Net cash used in financing activities	(3,424)	(4,495)
Change in cash and cash equivalents	17,762	7,163
Cash and cash equivalents, beginning of period	8,493	4,930
Cash and cash equivalents, end of period	$ 26,255	$ 12,093

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 26,255	$ 8,493
Accounts receivable, net	26,327	12,937
Inventory	1,704	2,382
Restricted assets, current	961	961
Other current assets	13,167	11,193
Total current assets	68,414	35,966
Property, equipment and software at cost	63,720	65,250
Accumulated depreciation and amortization	(43,440)	(43,164)
Property, equipment and software, net	20,280	22,086
Goodwill	43,518	43,518
Other intangible assets, net	2,858	3,607
Pre-publication costs, net	18,071	17,758
Restricted assets, less current portion	615	1,293
Deferred tax assets	27,497	30,614
Other assets	4,040	3,712
Total assets	185,293	158,554
Current liabilities:
Accounts payable	2,344	2,388
Accrued expenses	16,302	12,121
Current portion of long-term debt	6,776	5,958
Deferred revenue, current	96,468	86,913
Total current liabilities	121,890	107,380
Long-term liabilities:
Long-term debt	36,781	41,841
Deferred revenue, less current portion	17,751	13,995
Other liabilities	9,072	9,630
Total long-term liabilities	63,604	65,466
Commitments and contingencies (See Note 13)
Stockholders' equity (deficit):
Preferred stock ($.001 par value, 15,000 shares authorized, zero shares issued and outstanding at September 30, 2018 and December 31, 2017)	0	0
Common stock ($.001 par value, 150,000 shares authorized, 53,832 and 53,333 shares issued, and 47,300 and 46,800 shares outstanding at September 30, 2018 and December 31, 2017, respectively)	54	53
Capital surplus	290,837	289,022
Accumulated deficit	(276,322)	(288,490)
Treasury stock at cost (6,532 shares at September 30, 2018 and December 31, 2017)	(12,784)	(12,784)
Accumulated other comprehensive loss:
Pension and postretirement plans	(1,986)	(2,093)
Accumulated other comprehensive loss	(1,986)	(2,093)
Total stockholders' equity (deficit)	(201)	(14,292)
Total liabilities and stockholders' equity (deficit)	$ 185,293	$ 158,554