XML 35 R15.htm IDEA: XBRL DOCUMENT
v3.22.4

Business Acquisitions | 12 Months Ended
--- | ---
Dec. 31, 2022
Business Combination and Asset Acquisition [Abstract] |
Business Acquisitions | Business Acquisitions The Company uses acquisitions as a strategy to grow its customer base by increasing its presence in new and existing markets, expand and diversify its service offerings, enhance its technology, and acquire skilled personnel. 2022 Acquisitions The Company completed the following acquisitions during the year ended December 31, 2022, paying the purchase price in cash in each transaction: (a) a purchase of 100% equity interests of Lifecycle Marketing Group Limited, acquired on January 21, 2022, a United Kingdom-based portfolio of pregnancy and parenting brands, including Emma’s Diary and Health Professional Academy, reported within our Digital Media segment; (b) a purchase of 100% equity interests of FitNow, Inc., acquired on June 2, 2022, a Massachusetts-based provider of weight loss products and support, reported within our Digital Media segment; and (c) four other immaterial Digital Media acquisitions. The Consolidated Statement of Operations since the date of each acquisition and balance sheet as of December 31, 2022, reflect the results of operations of all 2022 acquisitions. For the year ended December 31, 2022, these acquisitions contributed $33.0 million to the Company’s revenues. Net income from continuing operations contributed by these acquisitions was not separately identifiable due to the Company’s integration activities and is impracticable to provide. Total consideration for these transactions was $121.7 million, net of cash acquired and assumed liabilities and is subject to certain post-closing adjustments which may increase or decrease the final consideration paid. The following table summarizes the allocation of the preliminary purchase consideration for all 2022 acquisitions as of December 31, 2022 (in thousands):
Assets and Liabilities | Valuation
Accounts receivable | $ | 7,433 |
Prepaid expenses and other current assets | 4,915 |
Property and equipment | 369 |
Operating lease right-of-use assets, noncurrent | 545 |
Trade names | 12,839 |
Customer relationships | 20,040 |
Goodwill | 95,737 |
Other intangibles | 18,166 |
Other long-term assets | 11 |
Accounts payable and accrued expenses | (6,221) |
Deferred revenue | (21,474) |
Deferred tax liability | (10,140) |
Other long-term liabilities | (516) |
Total | $ | 121,704 |
The initial accounting for all of the 2022 acquisitions is incomplete due to timing of available information and is subject to change. The Company has recorded provisional amounts which may be based upon past acquisitions with similar attributes for certain intangible assets (including trade names, software and customer relationships), preliminary acquisition date working capital, and related tax items. The fair value of the assets acquired includes accounts receivable of $7.4 million, all of which is expected to be collectible. The Company did not acquire any other classes of receivables as a result of its acquisitions. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired and represents intangible assets that do not qualify for separate recognition. Goodwill recognized associated with these acquisitions during the year ended December 31, 2022 is $95.7 million, of which $1.2 million is expected to be deductible for income tax purposes. During the year ended December 31, 2022, the purchase price accounting has been finalized for the following 2021 acquisitions: DailyOM, SEOmoz, Solutelia, LLC, Arthur L. Davis Publishing and four other immaterial Digital Media and Cybersecurity and Martech acquired businesses. During the year ended December 31, 2022, the Company recorded adjustments to the initial working capital and to the purchase accounting of certain other prior period acquisitions due to the finalization of prior period acquisitions in the Digital Media business. These measurement period adjustments resulted in a net increase in goodwill of $4.5 million, which included a $3.2 million increase in connection with the unfavorable contract liability for an acquired contract. The unfavorable contract liability is expected to be accreted over 3 years as of December 31, 2022. In addition, the Company recorded adjustments to the initial working capital and to the purchase accounting of certain prior period acquisitions due to the finalization of prior period acquisitions in the Cybersecurity and Martech businesses which resulted in a net decrease in goodwill of $0.1 million. Such adjustments had an immaterial impact on the amortization expense within the Consolidated Statements of Operations for the year ended December 31, 2022. Refer to Note 9 - Goodwill and Intangible Assets for additional information. Unaudited Pro Forma Financial Information for All 2022 Acquisitions The following unaudited pro forma information is not necessarily indicative of the Company’s consolidated results of operations in future periods or the results that actually would have been realized had the Company and the acquired businesses been combined companies during the periods presented. These pro forma results are estimates and exclude any savings or synergies that would have resulted from these business acquisitions had they occurred on January 1, 2021. This unaudited pro forma supplemental information includes incremental intangible asset amortization and other charges as a result of the acquisitions, net of the related tax effects. The supplemental information on an unaudited pro forma financial basis presents the combined results of the Company and its 2022 acquisitions as if each acquisition had occurred on January 1, 2021 (in thousands, except per share amounts):
| Year ended December 31,
| 2022 |  | 2021
| (unaudited)
Revenues | $ | 1,407,300 |  |  | $ | 1,461,178 |
Net income from continuing operations | $ | 64,877 |  |  | $ | 398,201 |
Income per common share from continuing operations - Basic | $ | 1.38 |  |  | $ | 8.67 |
Income per common share from continuing operations - Diluted | $ | 1.38 |  |  | $ | 8.31 |
2021 Acquisitions The Company completed the following acquisitions during the year ended December 31, 2021, paying the purchase price in cash in each transaction: (a) an asset purchase of DailyOM, acquired on April 30, 2021, a California-based provider of health and wellness digital media, content and learning business; (b) a share purchase of SEOmoz, acquired on June 4, 2021, a Seattle-based provider of search engine optimization (“SEO”) solutions; (c) an asset purchase of Solutelia, LLC, acquired on July 15, 2021, a Colorado-based on-demand wireless telecommunications network monitoring and analysis, testing and optimization software business and related wireless telecommunications engineering services business; (d) a stock purchase of Arthur L. Davis Publishing, acquired on September 23, 2021, an Iowa-based digital nursing publication; (e) a stock purchase of Root Wireless, Inc. acquired on December 13, 2021, a Washington-based mobile analytics firm; and (f) four other immaterial Digital Media acquisitions. The Consolidated Statement of Operations since the date of each acquisition and balance sheet as of December 31, 2021, reflect the results of operations of all 2021 acquisitions. For the year ended December 31, 2021, these acquisitions contributed $39.9 million to the Company’s revenues. Net income from continuing operations contributed by these acquisitions was not separately identifiable due to the Company’s integration activities and is impracticable to provide. Total consideration for these transactions was $160.4 million, net of cash acquired and assumed liabilities and is subject to certain post-closing adjustments which may increase or decrease the final consideration paid. The following table summarizes the allocation of the purchase consideration for all 2021 acquisitions as of December 31, 2021, including individually material acquisitions noted separately (in thousands):
Assets and Liabilities | Valuation
Accounts receivable | $ | 9,513 |
Prepaid expenses and other current assets | 1,655 |
Property and equipment | 2,188 |
Operating lease right-of-use assets, noncurrent | 5,888 |
Trade names | 16,349 |
Customer relationships | 21,945 |
Goodwill | 97,032
Other intangibles | 38,894 |
Other long-term assets | 62 |
Deferred tax asset | 230 |
Accounts payable and accrued expenses | (5,863) |
Deferred revenue | (9,491) |
Operating lease liabilities, current | (7,191) |
Other current liabilities | (14) |
Deferred tax liability | (9,237) |
Other long-term liabilities | (1,511) |
Total | $ | 160,449 |
The fair value of the assets acquired includes accounts receivable of $9.5 million. The gross amount due under contracts is $9.9 million, of which $0.4 million was expected to be uncollectible. The Company did not acquire any other classes of receivables as a result of its acquisitions. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired and represents intangible assets that do not qualify for separate recognition. Goodwill recognized associated with these acquisitions during the year ended December 31, 2021 is $97.0 million, of which $42.1 million is expected to be deductible for income tax purposes. Unaudited Pro Forma Financial Information for All 2021 Acquisitions The following unaudited pro forma information is not necessarily indicative of the Company’s consolidated results of operations in future periods or the results that actually would have been realized had the Company and the acquired businesses been combined companies during the periods presented. These pro forma results are estimates and exclude any savings or synergies that would have resulted from these business acquisitions had they occurred on January 1, 2020. This unaudited pro forma supplemental information includes incremental intangible asset amortization and other charges as a result of the acquisitions, net of the related tax effects. The supplemental information on an unaudited pro forma financial basis presents the combined results of the Company and its 2021 acquisitions as if each acquisition had occurred on January 1, 2020 (in thousands, except per share amounts):
| Year ended December 31,
| 2021 |  | 2020
| (unaudited)
Revenues | $ | 1,482,323 |  |  | $ | 1,267,280 |
Net income from continuing operations | $ | 416,348 |  |  | $ | 33,351 |
Income per common share from continuing operations - Basic | $ | 9.06 |  |  | $ | 0.72 |
Income per common share from continuing operations - Diluted | $ | 8.69 |  |  | $ | 0.71 |
SEOmoz Acquisition On June 4, 2021, the Company acquired all the outstanding issued capital of SEOmoz at a purchase consideration of $67.0 million, net of cash acquired and assumed liabilities. SEOmoz is a provider of search engine optimization (“SEO”) solutions. The Consolidated Statement of Operations since the date of acquisition and balance sheet as of December 31, 2021, reflect the results of operations of SEOmoz. For the year ended December 31, 2021, SEOmoz contributed $25.6 million to the Company’s revenues. Net income from continuing operations contributed by SEOmoz since the acquisition date was not separately identifiable due to the Company’s integration activities and is impracticable to provide. The following table summarizes the allocation of the purchase consideration for the SEOmoz acquisition (in thousands):
Assets and Liabilities | Valuation
Accounts receivable | $ | 3,278 |
Prepaid expenses and other current assets | 1,547 |
Property and equipment | 1,845 |
Operating lease right of use asset | 5,888 |
Trade names | 7,406 |
Customer relationships | 5,000 |
Goodwill | 41,329 |
Other intangibles | 22,777 |
Other long-term assets | 62 |
Accounts payables and accrued expenses | (2,655) |
Other current liabilities | (14) |
Deferred revenue | (6,398) |
Operating lease liabilities, current | (7,191) |
Deferred tax liability | (5,327) |
Other long-term liabilities | (550) |
Total | $ | 66,997 |
The fair value of the assets acquired includes accounts receivable of $3.3 million. The gross amount due under contracts is $3.6 million, of which $0.3 million was expected to be uncollectible. The Company did not acquire any other classes of receivables as a result of its acquisitions. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired and represents intangible assets that do not qualify for separate recognition. Goodwill recognized in connection with this acquisition during the year ended December 31, 2021 is $41.3 million of which zero is expected to be deductible for income tax purposes. During the year ended December 31, 2021, the Company recorded adjustments to the initial working capital and to the purchase accounting due to the finalization of prior period acquisitions in the Digital Media business, which resulted in a net decrease in goodwill of $1.4 million. In addition, the Company recorded adjustments to the initial working capital and to the purchase accounting due to the finalization of prior period acquisitions in the Cybersecurity and Martech businesses which resulted in a net increase in goodwill of $0.5 million. Such adjustments had an immaterial impact on the amortization expense within the Consolidated Statements of Operations for the year ended December 31, 2021. Refer to Note 9 - Goodwill and Intangible Assets for additional information. Unaudited Pro Forma Financial Information for SEOmoz Acquisition The following unaudited pro forma information is not necessarily indicative of the Company’s consolidated results of operations in future periods or the results that actually would have been realized had the Company and the acquired business been combined companies during the periods presented. These pro forma results are estimates and exclude any savings or synergies that would have resulted from this business acquisition had it occurred on January 1, 2020. This unaudited pro forma supplemental information includes incremental intangible asset amortization and other charges as a result of the SEOmoz acquisition, net of the related tax effects. The supplemental information on an unaudited pro forma financial basis presents the combined results of the Company and SEOmoz as if the acquisition had occurred on January 1, 2020 (in thousands, except per share amounts):
| Year ended December 31,
| 2021 |  | 2020
| (unaudited)
Revenues | $ | 1,438,099 |  |  | $ | 1,207,910 |
Net income from continuing operations | $ | 406,281 |  |  | $ | 29,382 |
Income per common share from continuing operations - Basic | $ | 8.84 |  |  | $ | 0.63 |
Income per common share from continuing operations - Diluted | $ | 8.48 |  |  | $ | 0.62 |
2020 Acquisitions The Company completed the following acquisitions during the year ended December 31, 2020, paying the purchase price in cash in each transaction: (a) a share purchase of the entire issued capital of RetailMeNot, Inc. acquired on October 28, 2020, a Texas-based provider of marketing solutions; (b) a share purchase of the entire issued capital of Inspired eLearning, LLC, acquired on November 2, 2020, a Texas-based platform for cybersecurity awareness and compliance training; (c) a share purchase of the entire issued capital of The Aberdeen Group, LLC and The Big Willow, Inc., acquired on November 20, 2020, a Massachusetts-based provider in digital marketing solutions; and (d) other immaterial acquisitions of email marketing, security and digital media businesses. The Consolidated Statement of Operations since the date of each acquisition and balance sheet as of December 31, 2020, reflect the results of operations of all 2020 acquisitions. For the year ended December 31, 2020, these acquisitions contributed $54.6 million to the Company’s revenues. Net income from continuing operations contributed by these acquisitions was not separately identifiable due to the Company’s integration activities and is impracticable to provide. Total consideration for these transactions was $472.8 million, net of cash acquired and assumed liabilities and subject to certain post-closing adjustments which may increase or decrease the final consideration paid. The following table summarizes the allocation of the purchase consideration for all 2020 acquisitions, including individually material acquisitions noted separately (in thousands):
Assets and Liabilities | Valuation
Accounts receivable | $ | 46,138 |
Prepaid expenses and other current assets | 9,105 |
Property and equipment | 2,204 |
Operating lease right of use asset | 10,644 |
Trade names | 66,763 |
Customer relationships | 214,347 |
Goodwill | 202,901 |
Other intangibles | 56,424 |
Other long-term assets | 685 |
Deferred tax asset | 992 |
Accounts payables and accrued expenses | (28,979) |
Deferred revenue | (21,918) |
Operating lease liabilities, current | (4,520) |
Long-term debt | (910) |
Operating lease liabilities, noncurrent | (13,104) |
Income taxes payable | (3,297) |
Liability for uncertain tax positions | (1,576) |
Deferred tax liability | (53,870) |
Other long-term liabilities | (9,269) |
Total | $ | 472,760 |
During the year ended December 31, 2020, the Company recorded adjustments to prior period acquisitions due to changes in the initial working capital and related purchase accounting within the Cybersecurity and Martech businesses, which resulted in a net decrease in goodwill of $2.1 million. In addition, the Company recorded adjustments to prior period acquisitions due to changes in the initial working capital and related purchase accounting within the Digital Media business, which resulted in a net increase in goodwill of $9.7 million. Such adjustments had an immaterial impact to amortization expense within the Consolidated Statements of Operations for the year ended December 31, 2020. The fair value of the assets acquired includes accounts receivable of $46.1 million. The gross amount due under contracts is $53.0 million, of which $6.9 million was expected to be uncollectible. The Company did not acquire any other classes of receivables as a result of its acquisitions. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired and represents intangible assets that do not qualify for separate recognition. Goodwill recognized in connection with these acquisitions during the year ended December 31, 2020 is $202.9 million, of which $55.0 million is expected to be deductible for income tax purposes. Unaudited Pro Forma Financial Information for All 2020 Acquisitions The following unaudited pro forma information is not necessarily indicative of the Company’s consolidated results of operations in future periods or the results that actually would have been realized had the Company and the acquired businesses been combined companies during the periods presented. These pro forma results are estimates and exclude any savings or synergies that would have resulted from these business acquisitions had they occurred on January 1, 2020 and do not take into consideration the exiting of any acquired lines of business. The Company acquired a line of business through the RetailMeNot, Inc. acquisition which was in the process of being exited prior to the acquisition. This line of business accounts for $0.1 million of revenue in 2020, respectively, which is included in the pro forma results below. In addition, during 2020, the Company sold certain Voice assets in Australia and New Zealand. This divestiture represented $8.4 million of revenue during the 2020 fiscal year. This unaudited pro forma supplemental information includes incremental intangible asset amortization, income tax expense, and interest income as a result of the acquisitions, net of the related tax effects. The supplemental information on an unaudited pro forma financial basis presents the combined results of the Company and its 2020 acquisitions as if each acquisition had occurred on January 1, 2020 (in thousands, except per share amounts):
| Year ended
| December 31, 2020 |  |
| (unaudited)
Revenues | $ | 1,339,927 |  |  |
Net income from continuing operations | $ | 21,450 |  |  |
Income per common share from continuing operations - Basic | $ | 0.46 |  |  |
Income per common share from continuing operations - Diluted | $ | 0.45 |  |  |
RetailMeNot, Inc. Acquisition On October 28, 2020, the Company acquired all the outstanding issued capital of RetailMeNot, Inc. at a purchase consideration of $414.4 million, net of cash acquired and assumed liabilities. RetailMeNot, Inc. (“RMN”) is a leading savings destination that influences purchase decisions through the power of savings and coupons. The multinational company operates digital savings websites and mobile applications connecting consumers, both online and in-store, to retailers that advertise with RMN. The Consolidated Statement of Operations since the date of acquisition and balance sheet as of December 31, 2020, reflect the results of operations of RetailMeNot, Inc. For the year ended December 31, 2020, RetailMeNot, Inc. contributed $47.6 million to the Company’s revenues. Net income from continuing operations contributed by RetailMeNot, Inc. since the acquisition date was not separately identifiable due to the Company’s integration activities and is impracticable to provide. The following table summarizes the allocation of the purchase consideration for the RetailMeNot, Inc. acquisition (in thousands):
Assets and Liabilities | Valuation
Accounts receivable | $ | 40,525 |
Prepaid expenses and other current assets | 7,367 |
Property and equipment | 587 |
Operating lease right of use asset | 10,313 |
Trade names | 62,940 |
Customer relationships | 198,840 |
Goodwill | 169,581 |
Other intangibles | 42,610 |
Other long-term assets | 494 |
Deferred tax asset | 605 |
Accounts payables and accrued expenses | (24,526) |
Deferred revenue | (11,175) |
Operating lease liabilities, current | (4,029) |
Operating lease liabilities, noncurrent | (13,085) |
Income taxes payable | (3,308) |
Liability for uncertain tax positions | (1,576) |
Deferred tax liability | (52,504) |
Other long-term liabilities | (9,275) |
Total | $ | 414,384 |
The fair value of the assets acquired included accounts receivable of $40.5 million. The gross amount due under contracts was $47.2 million, of which $6.7 million was expected to be uncollectible. The Company did not acquire any other classes of receivables as a result of its acquisitions. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired and represents intangible assets that do not qualify for separate recognition. Goodwill recognized in connection with this acquisition during the year ended December 31, 2020 was $169.6 million, of which $36.6 million was expected to be deductible for income tax purposes. Unaudited Pro Forma Financial Information for RetailMeNot, Inc. Acquisition The following unaudited pro forma information is not necessarily indicative of the Company’s consolidated results of operations in future periods or the results that actually would have been realized had the Company and the acquired business been combined companies during the periods presented. These pro forma results are estimates and exclude any savings or synergies that would have resulted from this business acquisition had it occurred on January 1, 2020 and do not take into consideration the exiting of any acquired lines of business. The Company acquired a line of business, through the RetailMeNot, Inc. acquisition which was in the process of being exited prior to the acquisition. The supplemental information on an unaudited pro forma financial basis presents the combined results of the Company and RetailMeNot, Inc. as if the acquisition had occurred on January 1, 2020 (in thousands, except per share amounts):
| Year ended
| December 31, 2020 |  |
| (unaudited)
Revenues | $ | 1,308,731 |  |  |
Net income from continuing operations | $ | 23,395 |  |  |
Income per common share from continuing operations - Basic | $ | 0.50 |  |  |
Income per common share from continuing operations - Diluted | $ | 0.49 |  |  |
As of December 31, 2022, future payments associated with long-term contractual obligations for holdback payments in connection with all business acquisitions are as follows (in thousands):
2023 | $ | 19,208 |
2024 | 7,359 |
| $ | 26,567 |

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationAndAssetAcquisitionAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI https://asc.fasb.org/topic&trid=2303972 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 20 -Section 50 -Paragraph 5 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=128092470&loc=d3e4946-128472 + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration