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Separate Financial Information of Subsidiary Guarantors of Indebtedness | 3 Months Ended
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Mar. 31, 2017
Condensed Financial Information of Parent Company Only Disclosure [Abstract] |
Separate Financial Information of Subsidiary Guarantors of Indebtedness | Separate Financial Information of Subsidiary Guarantors of Indebtedness On April 28, 2014, Quad/Graphics completed an offering of the Senior Unsecured Notes. Each of the Company's existing and future domestic subsidiaries that is a borrower or guarantees indebtedness under the Company's Senior Secured Credit Facility or that guarantees certain of the Company's other indebtedness or indebtedness of the Company's restricted subsidiaries (other than intercompany indebtedness) fully and unconditionally guarantee or, in the case of future subsidiaries, will guarantee, on a joint and several basis, the Senior Unsecured Notes (the "Guarantor Subsidiaries"). All of the current Guarantor Subsidiaries are 100% owned by the Company. Guarantor Subsidiaries will be automatically released from these guarantees upon the occurrence of certain events, including the following:
• | the designation of any of the Guarantor Subsidiaries as an unrestricted subsidiary;
• | the release or discharge of any guarantee or indebtedness that resulted in the creation of the guarantee of the Senior Unsecured Notes by any of the Guarantor Subsidiaries; or
• | the sale or disposition, including the sale of substantially all the assets, of any of the Guarantor Subsidiaries.
The following condensed consolidating financial information reflects the summarized financial information of Quad/Graphics, the Company's Guarantor Subsidiaries on a combined basis and the Company's non-guarantor subsidiaries on a combined basis. Condensed Consolidating Statement of Operations For the Three Months Ended March 31, 2017
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
Net sales | $ | 422.3 |  |  | $ | 563.4 |  |  | $ | 101.4 |  |  | $ | (88.5 | ) |  | $ | 998.6 |
Cost of sales | 303.1 |  |  | 483.6 |  |  | 81.7 |  |  | (87.3 | ) |  | 781.1 |
Selling, general and administrative expenses | 60.2 |  |  | 29.1 |  |  | 7.9 |  |  | (1.2 | ) |  | 96.0 |
Depreciation and amortization | 27.5 |  |  | 25.9 |  |  | 5.3 |  |  | — |  |  | 58.7 |
Restructuring, impairment and transaction-related charges | 11.4 |  |  | (3.0 | ) |  | 0.8 |  |  | — |  |  | 9.2 |
Total operating expenses | 402.2 |  |  | 535.6 |  |  | 95.7 |  |  | (88.5 | ) |  | 945.0 |
Operating income (loss) | $ | 20.1 |  |  | $ | 27.8 |  |  | $ | 5.7 |  |  | $ | — |  |  | $ | 53.6 |
Interest expense (income) | 17.3 |  |  | — |  |  | 0.9 |  |  | — |  |  | 18.2 |
Loss (gain) on debt extinguishment | 2.6 |  |  | — |  |  | — |  |  | — |  |  | 2.6 |
Earnings (loss) before income taxes and equity in (earnings) loss of consolidated and unconsolidated entities | 0.2 |  |  | 27.8 |  |  | 4.8 |  |  | — |  |  | 32.8 |
Income tax expense (benefit) | (2.8 | ) |  | 13.8 |  |  | (4.3 | ) |  | — |  |  | 6.7 |
Earnings (loss) before equity in (earnings) loss of consolidated and unconsolidated entities | 3.0 |  |  | 14.0 |  |  | 9.1 |  |  | — |  |  | 26.1 |
Equity in (earnings) loss of consolidated entities | (22.4 | ) |  | (0.5 | ) |  | — |  |  | 22.9 |  |  | — |
Equity in (earnings) loss of unconsolidated entity | — |  |  | — |  |  | 0.7 |  |  | — |  |  | 0.7 |
Net earnings (loss) | $ | 25.4 |  |  | $ | 14.5 |  |  | $ | 8.4 |  |  | $ | (22.9 | ) |  | $ | 25.4 |
Condensed Consolidating Statement of Comprehensive Income (Loss) For the Three Months Ended March 31, 2017
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
Net earnings (loss) | $ | 25.4 |  |  | $ | 14.5 |  |  | $ | 8.4 |  |  | $ | (22.9 | ) |  | $ | 25.4 |
Other comprehensive income (loss), net of tax | 8.1 |  |  | 0.4 |  |  | 7.4 |  |  | (7.8 | ) |  | 8.1 |
Total comprehensive income (loss) | $ | 33.5 |  |  | $ | 14.9 |  |  | $ | 15.8 |  |  | $ | (30.7 | ) |  | $ | 33.5 |
Condensed Consolidating Statement of Operations For the Three Months Ended March 31, 2016
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
Net sales | $ | 438.5 |  |  | $ | 587.9 |  |  | $ | 105.0 |  |  | $ | (88.9 | ) |  | $ | 1,042.5 |
Cost of sales | 308.9 |  |  | 501.2 |  |  | 82.3 |  |  | (88.9 | ) |  | 803.5 |
Selling, general and administrative expenses | 69.3 |  |  | 38.7 |  |  | 11.0 |  |  | — |  |  | 119.0 |
Depreciation and amortization | 45.4 |  |  | 25.2 |  |  | 7.5 |  |  | — |  |  | 78.1 |
Restructuring, impairment and transaction-related charges | 11.4 |  |  | 16.9 |  |  | 0.6 |  |  | — |  |  | 28.9 |
Total operating expenses | 435.0 |  |  | 582.0 |  |  | 101.4 |  |  | (88.9 | ) |  | 1,029.5 |
Operating income (loss) | $ | 3.5 |  |  | $ | 5.9 |  |  | $ | 3.6 |  |  | $ | — |  |  | $ | 13.0 |
Interest expense (income) | 20.8 |  |  | (1.1 | ) |  | 1.0 |  |  | — |  |  | 20.7 |
Loss (gain) on debt extinguishment | (14.1 | ) |  | — |  |  | — |  |  | — |  |  | (14.1 | )
Earnings (loss) before income taxes and equity in (earnings) loss of consolidated and unconsolidated entities | (3.2 | ) |  | 7.0 |  |  | 2.6 |  |  | — |  |  | 6.4 |
Income tax expense (benefit) | 8.1 |  |  | (6.3 | ) |  | (0.1 | ) |  | — |  |  | 1.7 |
Earnings (loss) before equity in (earnings) loss of consolidated and unconsolidated entities | (11.3 | ) |  | 13.3 |  |  | 2.7 |  |  | — |  |  | 4.7 |
Equity in (earnings) loss of consolidated entities | (15.1 | ) |  | (1.5 | ) |  | — |  |  | 16.6 |  |  | — |
Equity in (earnings) loss of unconsolidated entity | — |  |  | — |  |  | 0.9 |  |  | — |  |  | 0.9 |
Net earnings (loss) | $ | 3.8 |  |  | $ | 14.8 |  |  | $ | 1.8 |  |  | $ | (16.6 | ) |  | $ | 3.8 |
Condensed Consolidating Statement of Comprehensive Income (Loss) For the Three Months Ended March 31, 2016
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
Net earnings (loss) | $ | 3.8 |  |  | $ | 14.8 |  |  | $ | 1.8 |  |  | $ | (16.6 | ) |  | $ | 3.8 |
Other comprehensive income (loss), net of tax | 8.4 |  |  | (1.1 | ) |  | 6.6 |  |  | (5.5 | ) |  | 8.4 |
Total comprehensive income (loss) | $ | 12.2 |  |  | $ | 13.7 |  |  | $ | 8.4 |  |  | $ | (22.1 | ) |  | $ | 12.2 |
Condensed Consolidating Balance Sheet As of March 31, 2017
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
ASSETS |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 0.2 |  |  | $ | 0.8 |  |  | $ | 5.5 |  |  | $ | — |  |  | $ | 6.5 |
Receivables, less allowances for doubtful accounts | 382.3 |  |  | 39.1 |  |  | 83.7 |  |  | — |  |  | 505.1 |
Intercompany receivables | — |  |  | 729.8 |  |  | — |  |  | (729.8 | ) |  | — |
Inventories | 98.1 |  |  | 128.5 |  |  | 42.4 |  |  | — |  |  | 269.0 |
Other current assets | 29.3 |  |  | 13.3 |  |  | 12.1 |  |  | — |  |  | 54.7 |
Total current assets | 509.9 |  |  | 911.5 |  |  | 143.7 |  |  | (729.8 | ) |  | 835.3 |
Property, plant and equipment—net | 757.9 |  |  | 569.3 |  |  | 160.0 |  |  | — |  |  | 1,487.2 |
Investment in consolidated entities | 1,320.5 |  |  | 9.7 |  |  | — |  |  | (1,330.2 | ) |  | — |
Intangible assets—net | 10.7 |  |  | 33.1 |  |  | 11.6 |  |  | — |  |  | 55.4 |
Intercompany loan receivable | 106.5 |  |  | — |  |  | — |  |  | (106.5 | ) |  | — |
Other long-term assets | 48.7 |  |  | 10.0 |  |  | 34.3 |  |  | — |  |  | 93.0 |
Total assets | $ | 2,754.2 |  |  | $ | 1,533.6 |  |  | $ | 349.6 |  |  | $ | (2,166.5 | ) |  | $ | 2,470.9 |
LIABILITIES AND SHAREHOLDERS' EQUITY |  |  |  |  |  |  |  |  |
Accounts payable | $ | 172.2 |  |  | $ | 74.6 |  |  | $ | 57.6 |  |  | $ | — |  |  | $ | 304.4 |
Intercompany accounts payable | 710.4 |  |  | — |  |  | 19.4 |  |  | (729.8 | ) |  | — |
Short-term debt and current portion of long-term debt and capital lease obligations | 67.8 |  |  | 2.5 |  |  | 8.5 |  |  | — |  |  | 78.8 |
Other current liabilities | 193.9 |  |  | 71.4 |  |  | 26.3 |  |  | — |  |  | 291.6 |
Total current liabilities | 1,144.3 |  |  | 148.5 |  |  | 111.8 |  |  | (729.8 | ) |  | 674.8 |
Long-term debt and capital lease obligations | 1,009.3 |  |  | 2.2 |  |  | 12.5 |  |  | — |  |  | 1,024.0 |
Intercompany loan payable | — |  |  | 40.0 |  |  | 66.5 |  |  | (106.5 | ) |  | — |
Other long-term liabilities | 139.9 |  |  | 157.3 |  |  | 14.2 |  |  | — |  |  | 311.4 |
Total liabilities | 2,293.5 |  |  | 348.0 |  |  | 205.0 |  |  | (836.3 | ) |  | 2,010.2 |
Total shareholders' equity | 460.7 |  |  | 1,185.6 |  |  | 144.6 |  |  | (1,330.2 | ) |  | 460.7 |
Total liabilities and shareholders' equity | $ | 2,754.2 |  |  | $ | 1,533.6 |  |  | $ | 349.6 |  |  | $ | (2,166.5 | ) |  | $ | 2,470.9 |
Condensed Consolidating Balance Sheet As of December 31, 2016
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
ASSETS |  |  |  |  |  |  |  |  |
Cash and cash equivalents | $ | 0.3 |  |  | $ | 1.9 |  |  | $ | 6.8 |  |  | $ | — |  |  | $ | 9.0 |
Receivables, less allowances for doubtful accounts | 439.7 |  |  | 37.7 |  |  | 86.2 |  |  | — |  |  | 563.6 |
Intercompany receivables | — |  |  | 720.5 |  |  | — |  |  | (720.5 | ) |  | — |
Inventories | 102.2 |  |  | 115.9 |  |  | 47.3 |  |  | — |  |  | 265.4 |
Other current assets | 40.6 |  |  | 15.7 |  |  | 8.3 |  |  | — |  |  | 64.6 |
Total current assets | 582.8 |  |  | 891.7 |  |  | 148.6 |  |  | (720.5 | ) |  | 902.6 |
Property, plant and equipment—net | 777.3 |  |  | 577.9 |  |  | 164.7 |  |  | — |  |  | 1,519.9 |
Investment in consolidated entities | 1,288.9 |  |  | 61.8 |  |  | — |  |  | (1,350.7 | ) |  | — |
Intangible assets—net | 12.0 |  |  | 20.3 |  |  | 27.4 |  |  | — |  |  | 59.7 |
Intercompany loan receivable | 104.2 |  |  | — |  |  | — |  |  | (104.2 | ) |  | — |
Other long-term assets | 43.5 |  |  | 10.1 |  |  | 34.3 |  |  | — |  |  | 87.9 |
Total assets | $ | 2,808.7 |  |  | $ | 1,561.8 |  |  | $ | 375.0 |  |  | $ | (2,175.4 | ) |  | $ | 2,570.1 |
LIABILITIES AND SHAREHOLDERS' EQUITY |  |  |  |  |  |  |  |  |
Accounts payable | $ | 159.3 |  |  | $ | 98.5 |  |  | $ | 65.7 |  |  | $ | — |  |  | $ | 323.5 |
Intercompany accounts payable | 711.2 |  |  | — |  |  | 9.3 |  |  | (720.5 | ) |  | — |
Short-term debt and current portion of long-term debt and capital lease obligations | 79.5 |  |  | 2.9 |  |  | 9.7 |  |  | — |  |  | 92.1 |
Other current liabilities | 253.9 |  |  | 76.2 |  |  | 28.9 |  |  | — |  |  | 359.0 |
Total current liabilities | 1,203.9 |  |  | 177.6 |  |  | 113.6 |  |  | (720.5 | ) |  | 774.6 |
Long-term debt and capital lease obligations | 1,022.0 |  |  | 2.4 |  |  | 14.3 |  |  | — |  |  | 1,038.7 |
Intercompany loan payable | — |  |  | 39.9 |  |  | 64.3 |  |  | (104.2 | ) |  | — |
Other long-term liabilities | 141.3 |  |  | 150.0 |  |  | 24.0 |  |  | — |  |  | 315.3 |
Total liabilities | 2,367.2 |  |  | 369.9 |  |  | 216.2 |  |  | (824.7 | ) |  | 2,128.6 |
Total shareholders' equity | 441.5 |  |  | 1,191.9 |  |  | 158.8 |  |  | (1,350.7 | ) |  | 441.5 |
Total liabilities and shareholders' equity | $ | 2,808.7 |  |  | $ | 1,561.8 |  |  | $ | 375.0 |  |  | $ | (2,175.4 | ) |  | $ | 2,570.1 |
Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2017
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
OPERATING ACTIVITIES |  |  |  |  |  |  |  |  |
Net cash from operating activities | $ | 63.9 |  |  | $ | (1.6 | ) |  | $ | 1.0 |  |  | $ | — |  |  | $ | 63.3 |
INVESTING ACTIVITIES |  |  |  |  |  |  |  |  |
Purchases of property, plant and equipment | (4.3 | ) |  | (16.6 | ) |  | (2.5 | ) |  | — |  |  | (23.4 | )
Intercompany investing activities | (5.3 | ) |  | 3.2 |  |  | 0.4 |  |  | 1.7 |  |  | — |
Other investing activities | (3.9 | ) |  | 18.9 |  |  | 0.1 |  |  | — |  |  | 15.1 |
Net cash from (used in) investing activities | (13.5 | ) |  | 5.5 |  |  | (2.0 | ) |  | 1.7 |  |  | (8.3 | )
FINANCING ACTIVITIES |  |  |  |  |  |  |  |  |
Proceeds from issuance of long-term debt | 375.0 |  |  | — |  |  | — |  |  | — |  |  | 375.0 |
Payments of long-term debt and capital lease obligations | (383.3 | ) |  | (0.8 | ) |  | (2.0 | ) |  | — |  |  | (386.1 | )
Borrowings on revolving credit facilities | 65.1 |  |  | — |  |  | 1.9 |  |  | — |  |  | 67.0 |
Payments on revolving credit facilities | (80.5 | ) |  | — |  |  | (3.3 | ) |  | — |  |  | (83.8 | )
Payment of cash dividends | (16.8 | ) |  | — |  |  | — |  |  | — |  |  | (16.8 | )
Intercompany financing activities | (0.8 | ) |  | — |  |  | 2.5 |  |  | (1.7 | ) |  | — |
Other financing activities | (9.2 | ) |  | (4.1 | ) |  | — |  |  | — |  |  | (13.3 | )
Net cash from (used in) financing activities | (50.5 | ) |  | (4.9 | ) |  | (0.9 | ) |  | (1.7 | ) |  | (58.0 | )
Effect of exchange rates on cash and cash equivalents | — |  |  | (0.1 | ) |  | 0.6 |  |  | — |  |  | 0.5 |
Net increase (decrease) in cash and cash equivalents | (0.1 | ) |  | (1.1 | ) |  | (1.3 | ) |  | — |  |  | (2.5 | )
Cash and cash equivalents at beginning of period | 0.3 |  |  | 1.9 |  |  | 6.8 |  |  | — |  |  | 9.0 |
Cash and cash equivalents at end of period | $ | 0.2 |  |  | $ | 0.8 |  |  | $ | 5.5 |  |  | $ | — |  |  | $ | 6.5 |
Condensed Consolidating Statement of Cash Flows For the Three Months Ended March 31, 2016
| Quad/Graphics, Inc. |  | Guarantor Subsidiaries |  | Non-Guarantor Subsidiaries |  | Eliminations |  | Total
OPERATING ACTIVITIES |  |  |  |  |  |  |  |  |
Net cash from operating activities | $ | 78.6 |  |  | $ | 25.2 |  |  | $ | 8.8 |  |  | $ | — |  |  | $ | 112.6 |
INVESTING ACTIVITIES |  |  |  |  |  |  |  |  |
Purchases of property, plant and equipment | (12.4 | ) |  | (6.9 | ) |  | (6.9 | ) |  | — |  |  | (26.2 | )
Intercompany investing activities | 14.5 |  |  | (17.4 | ) |  | (0.1 | ) |  | 3.0 |  |  | — |
Other investing activities | 0.6 |  |  | 0.4 |  |  | 1.5 |  |  | — |  |  | 2.5 |
Net cash from (used in) investing activities | 2.7 |  |  | (23.9 | ) |  | (5.5 | ) |  | 3.0 |  |  | (23.7 | )
FINANCING ACTIVITIES |  |  |  |  |  |  |  |  |
Proceeds from issuance of long-term debt | — |  |  | — |  |  | 18.4 |  |  | — |  |  | 18.4 |
Payments of long-term debt and capital lease obligations | (115.8 | ) |  | (0.9 | ) |  | — |  |  | — |  |  | (116.7 | )
Borrowings on revolving credit facilities | 273.8 |  |  | — |  |  | 19.8 |  |  | — |  |  | 293.6 |
Payments on revolving credit facilities | (238.5 | ) |  | — |  |  | (20.0 | ) |  | — |  |  | (258.5 | )
Purchases of treasury stock | (8.8 | ) |  | — |  |  | — |  |  | — |  |  | (8.8 | )
Payment of cash dividends | (15.4 | ) |  | — |  |  | — |  |  | — |  |  | (15.4 | )
Intercompany financing activities | 25.5 |  |  | 0.1 |  |  | (22.6 | ) |  | (3.0 | ) |  | — |
Other financing activities | (2.1 | ) |  | — |  |  | — |  |  | — |  |  | (2.1 | )
Net cash from (used in) financing activities | (81.3 | ) |  | (0.8 | ) |  | (4.4 | ) |  | (3.0 | ) |  | (89.5 | )
Effect of exchange rates on cash and cash equivalents | — |  |  | — |  |  | 0.1 |  |  | — |  |  | 0.1 |
Net increase (decrease) in cash and cash equivalents | — |  |  | 0.5 |  |  | (1.0 | ) |  | — |  |  | (0.5 | )
Cash and cash equivalents at beginning of period | 2.3 |  |  | 2.8 |  |  | 5.7 |  |  | — |  |  | 10.8 |
Cash and cash equivalents at end of period | $ | 2.3 |  |  | $ | 3.3 |  |  | $ | 4.7 |  |  | $ | — |  |  | $ | 10.3 |

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