| Schedule of New Accounting Pronouncements and Changes in Accounting Principles |
The following table presents the effect of the adoption of ASU 2014-09 on its Consolidated Balance Sheets as of December 31, 2018 (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2018 |
|
Without ASC 606 Adoption |
|
Effect of Change Increase/ (Decrease) |
|
As Reported |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
39,154 |
|
|
— |
|
|
$ |
39,154 |
|
Restricted cash |
801 |
|
|
— |
|
|
801 |
|
Accounts receivable, net |
98,136 |
|
|
(513 |
) |
|
97,623 |
|
Inventories |
34,649 |
|
|
— |
|
|
34,649 |
|
Prepaid expenses |
9,104 |
|
|
— |
|
|
9,104 |
|
Other current assets |
10,498 |
|
|
— |
|
|
10,498 |
|
TOTAL CURRENT ASSETS |
192,342 |
|
|
(513 |
) |
|
191,829 |
|
Content library |
6,966 |
|
|
— |
|
|
6,966 |
|
Property, plant and equipment |
176,577 |
|
|
— |
|
|
176,577 |
|
Goodwill |
159,562 |
|
|
— |
|
|
159,562 |
|
Intangible assets, net |
84,136 |
|
|
— |
|
|
84,136 |
|
Equity method investments |
83,135 |
|
|
— |
|
|
83,135 |
|
Other non-current assets |
7,866 |
|
|
7,016 |
|
|
14,882 |
|
TOTAL ASSETS |
$ |
710,584 |
|
|
$ |
6,503 |
|
|
$ |
717,087 |
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
$ |
178,916 |
|
|
(1,860 |
) |
|
$ |
177,056 |
|
Deferred revenue |
7,574 |
|
|
(144 |
) |
|
7,430 |
|
Current portion of long-term debt |
22,673 |
|
|
— |
|
|
22,673 |
|
Other current liabilities |
5,032 |
|
|
— |
|
|
5,032 |
|
TOTAL CURRENT LIABILITIES |
214,195 |
|
|
(2,004 |
) |
|
212,191 |
|
Deferred revenue, non-current |
1,116 |
|
|
— |
|
|
1,116 |
|
Long-term debt |
686,938 |
|
|
— |
|
|
686,938 |
|
Deferred tax liabilities |
8,406 |
|
|
— |
|
|
8,406 |
|
Other non-current liabilities |
34,771 |
|
|
— |
|
|
34,771 |
|
TOTAL LIABILITIES |
945,426 |
|
|
(2,004 |
) |
|
943,422 |
|
|
|
|
|
|
|
Preferred stock |
— |
|
|
— |
|
|
— |
|
Common stock |
10 |
|
|
— |
|
|
10 |
|
Treasury stock |
(30,659 |
) |
|
— |
|
|
(30,659 |
) |
Additional paid-in capital |
814,488 |
|
|
— |
|
|
814,488 |
|
Subscriptions receivable |
(597 |
) |
|
— |
|
|
(597 |
) |
Prior year accumulated deficit |
(773,791 |
) |
|
932 |
|
|
$ |
(772,859 |
) |
Current year retained deficit |
(244,174 |
) |
|
7,575 |
|
|
$ |
(236,599 |
) |
Accumulated other comprehensive loss |
(119 |
) |
|
— |
|
|
(119 |
) |
TOTAL STOCKHOLDERS’ DEFICIT |
(234,842 |
) |
|
8,507 |
|
|
(226,335 |
) |
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT |
$ |
710,584 |
|
|
6,503 |
|
|
$ |
717,087 |
|
The following table presents the effect of the adoption of ASU 2014-09 on the Company’s Consolidated Statements of Operations for the twelve months ended December 31, 2018 (in thousands, except per share amounts):
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, 2018 |
|
Without ASC 606 Adoption |
|
Effect of Change Increase/ (Decrease) |
|
As Reported |
Revenue: |
|
|
|
|
|
Licensing and services |
$ |
607,648 |
|
|
(1,421 |
) |
|
$ |
606,227 |
|
Equipment |
35,375 |
|
|
5,492 |
|
|
40,867 |
|
Total revenue |
643,023 |
|
|
4,071 |
|
|
647,094 |
|
Cost of sales: |
|
|
|
|
|
Licensing and services |
482,194 |
|
|
(1,330 |
) |
|
480,864 |
|
Equipment |
31,362 |
|
|
167 |
|
|
31,529 |
|
Total cost of sales |
513,556 |
|
|
(1,163 |
) |
|
512,393 |
|
Gross Margin |
129,467 |
|
|
5,234 |
|
|
134,701 |
|
Operating expenses: |
|
|
|
|
|
Sales and marketing |
37,594 |
|
|
30 |
|
|
37,624 |
|
Product development |
35,111 |
|
|
(2,371 |
) |
|
32,740 |
|
General and administrative |
134,663 |
|
|
— |
|
|
134,663 |
|
Provision for legal settlements |
1,317 |
|
|
— |
|
|
1,317 |
|
Amortization of intangible assets |
38,440 |
|
|
— |
|
|
38,440 |
|
Goodwill impairment |
— |
|
|
— |
|
|
— |
|
Total operating expenses |
247,125 |
|
|
(2,341 |
) |
|
244,784 |
|
Loss from operations |
(117,658 |
) |
|
7,575 |
|
|
(110,083 |
) |
Other income (expense): |
|
|
|
|
|
Interest expense, net |
(76,218 |
) |
|
— |
|
|
(76,218 |
) |
Income from equity method investments |
(46,310 |
) |
|
— |
|
|
(46,310 |
) |
Change in fair value of derivatives |
97 |
|
|
— |
|
|
97 |
|
Other expense, net |
(1,017 |
) |
|
— |
|
|
(1,017 |
) |
Loss before income taxes |
(241,106 |
) |
|
7,575 |
|
|
(233,531 |
) |
Income tax expense |
3,068 |
|
|
— |
|
|
3,068 |
|
Net loss |
$ |
(244,174 |
) |
|
7,575 |
|
|
$ |
(236,599 |
) |
|
|
|
|
|
|
Net loss per share – basic and diluted |
$ |
(2.67 |
) |
|
|
|
$ |
(2.59 |
) |
Weighted average shares outstanding – basic and diluted |
91,325 |
|
|
|
|
91,325 |
|
|
| Schedule of Accounts Receivable and Allowance For Doubtful Accounts |
Accounts receivable consist of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
December 31, |
|
December 31, |
|
2018 |
|
2017 |
Accounts receivable, gross |
$ |
103,301 |
|
|
$ |
122,225 |
|
Less: Allowance for doubtful accounts |
(5,678 |
) |
|
(8,680 |
) |
Accounts receivable, net |
$ |
97,623 |
|
|
$ |
113,545 |
|
Movements in the balance for allowance for doubtful accounts for the twelve months ended December 31, 2018 and 2017 are as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, |
|
2018 |
|
2017 |
|
2016 |
Beginning balance |
$ |
8,680 |
|
|
$ |
10,091 |
|
|
$ |
8,640 |
|
Additions charged to statements of operations |
1,227 |
|
|
2,788 |
|
|
2,624 |
|
Less: Bad debt write offs |
(4,229 |
) |
|
(4,199 |
) |
|
(1,173 |
) |
Ending balance |
$ |
5,678 |
|
|
$ |
8,680 |
|
|
$ |
10,091 |
|
|