XML 32 R19.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Segment Information | 3 Months Ended
--- | ---
Mar. 31, 2018
Segment Reporting [Abstract] |
Segment Information | Segment Information The Company determines an operating segment if a component (i) engages in business activities from which it earns revenues and incurs expenses, (ii) has discrete financial information, and is (iii) regularly reviewed by the Chief Operating Decision Maker (“CODM”) to make decisions regarding resource allocation for the segment and assess its performance. Once operating segments are identified, the Company performs an analysis to determine if aggregation of its operating segments is consistent with the principles detailed in ASC 280. This determination is based upon a quantitative analysis of the expected and historic average long-term profitability for each operating segment, together with an assessment of the qualitative characteristics set forth in ASC Topic 280-10-50. The four reportable segments that result from applying the aggregation criteria are as follows: “Global Integrated Agencies”; “Domestic Creative Agencies”; “Specialist Communications”; and “Media Services.” In addition, the Company combines and discloses those operating segments that do not meet the aggregation criteria as “All Other.” The Company also reports corporate expenses, as further detailed below, as “Corporate.” All segments follow the same basis of presentation and accounting policies as those described in Note 1 and 2, respectively.
• | The Global Integrated Agencies reportable segment is comprised of the Company’s six global, integrated operating segments with broad marketing communication capabilities, including advertising, branding, digital, social media, design and production services, serving multinational clients around the world. The Global Integrated Agencies reportable segment includes 72andSunny, Anomaly, Crispin Porter + Bogusky, Doner, Forsman & Bodenfors, and kbs+. These operating segments share similar characteristics related to (i) the nature of their services; (ii) the type of global clients and the methods used to provide services; and (iii) the extent to which they may be impacted by global economic and geopolitical risks. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Global Integrated Agencies reportable segment.
• | The Domestic Creative Agencies reportable segment is comprised of four operating segments that are national advertising agencies leveraging creative capabilities at their core. The Domestic Creative Agencies reportable segment includes Colle + McVoy, Laird+Partners, Mono Advertising and Union. These operating segments share similar characteristics related to (i) the nature of their creative advertising services; (ii) the type of domestic client accounts and the methods used to provide services; and (iii) the extent to which they may be impacted by domestic economic and policy factors within North America. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Domestic Creative Agencies reportable segment.
• | The Specialist Communications reportable segment is comprised of seven operating segments that are each communications agencies with core service offerings in public relations and related communications services. The Specialist Communications reportable segment includes Allison & Partners, Hunter PR, HL Group Partners, Kwittken, Luntz Global, Sloane & Company and Veritas. These operating segments share similar characteristics related to (i) the nature of their public relations and communication services, including content creation, social media and influencer marketing; (ii) the type of client accounts and the methods used to provide services; (iii) the extent to which they may be impacted by domestic economic and policy factors within North America; and (iv) the regulatory environment regarding public relations and social media. In addition, these operating segments compete with each other for new business and from time to time have business move between them. The Company believes the historic and expected average long-term profitability is similar among the operating segments aggregated in the Specialist Communications reportable segment.
• | The Media Services reportable segment is comprised of a single operating segment known as MDC Media Partners. MDC Media Partners is comprised of the Company’s network of stand-alone agencies with media buying and planning as their core competency, including the integrated platform Assembly. The agencies within this single operating segment share a Chief Executive Officer and Chief Financial Officer, who have operational oversight of these agencies. These agencies provide other services, including influencer marketing, content, insights & analytics, out-of-home, paid search, social media, lead generation, programmatic, artificial intelligence, and corporate barter. MDC Media Partners operates primarily in North America.
• | All Other consists of the Company’s remaining operating segments that provide a range of diverse marketing communication services, but generally do not have similar services offerings or financial characteristics as those aggregated in the reportable segments. The All Other category includes 6Degrees, Bruce Mau Design, Concentric Partners, Civilian, Gale Partners, Hello Design, Kenna, Kingsdale, Northstar Research Partners, Redscout, Relevent, Team, Vitro, Yamamoto and Y Media Labs. The nature of the specialist services provided by these operating segments vary among each other and from those operating segments aggregated into the reportable segments. This results in these operating segments having current and long-term performance expectations inconsistent with those operating segments aggregated in the reportable segments.
Prior to January 1, 2018, Source Marketing was included in the All Other category. Effective January 1, 2018, due to changes in the Company’s internal management and reporting structure, the operations of Source Marketing are included within the Doner operating segment. As a result of this change, the results of Source Marketing are included in the Global Integrated Agencies reportable segment beginning in the first quarter of 2018. Prior period segment information included herein has been adjusted to reflect this change.
• | Corporate consists of corporate office expenses incurred in connection with the strategic resources provided to the operating segments, as well as certain other centrally managed expenses that are not fully allocated to the operating segments. These office and general expenses include (i) salaries and related expenses for corporate office employees, including employees dedicated to supporting the operating segments, (ii) occupancy expenses relating to properties occupied by all corporate office employees, (iii) other office and general expenses including professional fees for the financial statement audits and other public company costs, and (iv) certain other professional fees managed by the corporate office. Additional expenses managed by the corporate office that are directly related to the operating segments are allocated to the appropriate reportable segment and the All Other category.
| Three Months Ended March 31,
| 2018 |  | 2017
Revenue: |  |  |
Global Integrated Agencies | $ | 150,355 |  |  | $ | 179,225 |
Domestic Creative Agencies | 21,296 |  |  | 20,910 |
Specialist Communications | 43,150 |  |  | 40,684 |
Media Services | 31,257 |  |  | 35,244 |
All Other | 80,910 |  |  | 68,637 |
Total | $ | 326,968 |  |  | $ | 344,700 |
Operating Income (Loss): |  |  |
Global Integrated Agencies | $ | (15,761 | ) |  | $ | (626 | )
Domestic Creative Agencies | 3,454 |  |  | 3,523 |
Specialist Communications | 4,027 |  |  | 4,335 |
Media Services | 487 |  |  | 2,642 |
All Other | 7,232 |  |  | 7,094 |
Corporate | (14,072 | ) |  | (8,569 | )
Total | $ | (14,633 | ) |  | $ | 8,399 |
Other Income (Expense): |  |  |
Other (expense) income, net | (6,219 | ) |  | 2,567 |
Interest expense and finance charges, net | (16,083 | ) |  | (16,541 | )
Loss before income taxes and equity in earnings of non-consolidated affiliates | (36,935 | ) |  | (5,575 | )
Income tax expense (benefit) | (8,330 | ) |  | 3,969 |
Loss before equity in earnings of non-consolidated affiliates | (28,605 | ) |  | (9,544 | )
Equity in earnings (losses) of non-consolidated affiliates | 86 |  |  | (139 | )
Net loss | (28,519 | ) |  | (9,683 | )
Net income attributable to the noncontrolling interest | (897 | ) |  | (883 | )
Net loss attributable to MDC Partners Inc. | $ | (29,416 | ) |  | $ | (10,566 | )
| Three Months Ended March 31,
| 2018 |  | 2017
Depreciation and amortization: |  |  |
Global Integrated Agencies | $ | 8,016 |  |  | $ | 5,961 |
Domestic Creative Agencies | $ | 353 |  |  | $ | 360 |
Specialist Communications | $ | 1,002 |  |  | $ | 1,216 |
Media Services | $ | 644 |  |  | $ | 1,005 |
All Other (1) | $ | 2,136 |  |  | $ | 2,047 |
Corporate | $ | 224 |  |  | $ | 309 |
Total | $ | 12,375 |  |  | $ | 10,898 |
Stock-based compensation: |  |  |
Global Integrated Agencies | $ | 2,547 |  |  | $ | 2,989 |
Domestic Creative Agencies | $ | 149 |  |  | $ | 155 |
Specialist Communications | $ | 336 |  |  | $ | 518 |
Media Services | $ | 74 |  |  | $ | 160 |
All Other | $ | 683 |  |  | $ | 524 |
Corporate | $ | 1,248 |  |  | $ | 604 |
Total | $ | 5,037 |  |  | $ | 4,950 |
Capital expenditures: |  |  |
Global Integrated Agencies | $ | 2,837 |  |  | $ | 6,907 |
Domestic Creative Agencies | $ | 191 |  |  | $ | 286 |
Specialist Communications | $ | 240 |  |  | $ | 291 |
Media Services | $ | 193 |  |  | $ | 1,014 |
All Other | $ | 330 |  |  | $ | 914 |
Corporate | $ | 8 |  |  | $ | 1 |
Total | $ | 3,799 |  |  | $ | 9,413 |
The Company’s CODM does not use segment assets to allocate resources or to assess performance of the segments and therefore, total segment assets have not been disclosed. See Note 3 for a summary of the Company’s revenue by geographic region for the three months ended March 31, 2018 and 2017.

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

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration