| Information About the Company's Segments |
The following table sets forth information about the Company's segments, including a reconciliation of adjusted EBITDA to net income.
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Three Months Ended
December 31, |
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2019 |
|
2018 |
Sales: |
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SGK Brand Solutions |
$ |
174,880 |
|
|
$ |
185,300 |
|
Memorialization |
154,405 |
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|
153,886 |
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Industrial Technologies |
35,659 |
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|
34,991 |
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Consolidated Sales |
$ |
364,944 |
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$ |
374,177 |
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Adjusted EBITDA: |
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SGK Brand Solutions |
$ |
18,738 |
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|
$ |
27,351 |
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Memorialization |
30,093 |
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|
30,321 |
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Industrial Technologies |
4,314 |
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|
3,595 |
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Corporate and Non-Operating |
(12,915 |
) |
|
(14,786 |
) |
Total Adjusted EBITDA |
$ |
40,230 |
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$ |
46,481 |
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Acquisition costs (1)**
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(1,948 |
) |
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(2,032 |
) |
ERP integration costs (2)**
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(665 |
) |
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(2,177 |
) |
Strategic initiatives and other charges (3)**
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(10,251 |
) |
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— |
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Loss on divestiture (4)
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— |
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(4,465 |
) |
Joint Venture depreciation, amortization, interest expense and other charges (5)
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(797 |
) |
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— |
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Stock-based compensation |
(2,031 |
) |
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(3,647 |
) |
Non-service pension and postretirement expense (6)
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(2,228 |
) |
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(931 |
) |
Depreciation and amortization *
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(28,933 |
) |
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(19,226 |
) |
Interest expense |
(9,240 |
) |
|
(10,301 |
) |
Net income (loss) attributable to noncontrolling interests |
160 |
|
|
(113 |
) |
(Loss) income before income taxes |
(15,703 |
) |
|
3,589 |
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Income tax benefit (provision) |
5,397 |
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|
(605 |
) |
Net (loss) income |
$ |
(10,306 |
) |
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$ |
2,984 |
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(1) Includes certain non-recurring costs associated with recent acquisition activities.
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(2) Represents costs associated with global ERP system integration efforts.
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(3) Includes certain non-recurring costs associated with productivity and cost-reduction initiatives intended to result in improved operating performance, profitability and working capital levels.
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(4) Represents a loss on the sale of a controlling interest in a subsidiary within the Memorialization segment.
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(5) Represents the Company's portion of depreciation, intangible amortization, interest expense, and other non-recurring charges incurred by non-consolidated subsidiaries accounted for as equity-method investments within the Memorialization segment.
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(6) Non-service pension and postretirement expense includes interest cost, expected return on plan assets and amortization of actuarial gains and losses. These benefit cost components are excluded from adjusted EBITDA since they are primarily influenced by external market conditions that impact investment returns and interest (discount) rates. The service cost and prior service cost components of pension and postretirement expense are included in the calculation of adjusted EBITDA, since they are considered to be a better reflection of the ongoing service-related costs of providing these benefits. Please note that GAAP pension and postretirement expense or the adjustment above are not necessarily indicative of the current or future cash flow requirements related to these employee benefit plans.
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** Acquisition costs, ERP integration costs, and strategic initiatives and other charges were $3,446 and $601 for the SGK Brand Solutions segment and $9,090 and $3,608 for Corporate and Non-Operating, for the three months ended December 31, 2019 and 2018, respectively. Acquisition costs, ERP integration costs, and strategic initiatives and other charges were $328 for the Memorialization segment for the three months ended December 31, 2019.
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