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10-K
GRAHAM HOLDINGS CO filed this Form 10-K on 02/23/2018
Entire Document
 


Other Businesses. A summary of Other Businesses’ operating results for 2016 compared to 2015 is as follows:
  
 
Year Ended December 31
 
%
(in thousands)
 
2016
 
2015
 
Change
Operating Revenues
 
  
 
  
 
  
Manufacturing
 
$
241,604

 
$
92,255

 

Healthcare
 
146,962

 
135,550

 
8

SocialCode
 
58,851

 
45,829

 
28

Other
 
26,433

 
25,883

 
2

  
 
$
473,850

 
$
299,517

 
58

Operating Expenses
 
  

 
  

 
  

Manufacturing
 
$
228,887

 
$
85,839

 

Healthcare
 
144,163

 
129,317

 
11

SocialCode
 
71,258

 
46,375

 
54

Other
 
51,644

 
51,653

 

  
 
$
495,952

 
$
313,184

 
58

Operating Income (Loss)
 
  

 
  

 
  

Manufacturing
 
$
12,717

 
$
6,416

 
98

Healthcare
 
2,799

 
6,233

 
(55
)
SocialCode
 
(12,407
)
 
(546
)
 

Other
 
(25,211
)
 
(25,770
)
 
2

  
 
$
(22,102
)
 
$
(13,667
)
 
(62
)
Depreciation
 
 
 
 
 
 
Manufacturing
 
$
7,251

 
$
1,868

 

Healthcare
 
2,805

 
2,836

 
(1
)
SocialCode
 
929

 
402

 

Other
 
1,390

 
1,062

 
31

  
 
$
12,375

 
$
6,168

 

Amortization of Intangible Assets and Impairment of Goodwill and Other Long-Lived Assets
 
 
 
 
 
 
Manufacturing
 
$
12,119

 
$
6,319

 
92

Healthcare
 
6,701

 
6,875

 
(3
)
SocialCode
 

 

 

Other
 
1,687

 
2,918

 
(42
)
  
 
$
20,507

 
$
16,112

 
27

Pension Expense
 
  

 
  

 
  

Manufacturing
 
$
86

 
$
73

 
18

Healthcare
 

 

 

SocialCode
 
541

 
270

 

Other
 
491

 
621

 
(21
)
  
 
$
1,118

 
$
964

 
16

Manufacturing includes three businesses: Dekko, a manufacturer of electrical workspace solutions, architectural lighting and electrical components and assemblies acquired in November 2015; Joyce/Dayton Corp., a Dayton, OH-based manufacturer of screw jacks and other linear motion systems; and Forney, a global supplier of products and systems that control and monitor combustion processes in electric utility and industrial applications.
Manufacturing revenues and operating income increased in 2016 due primarily to the Dekko acquisition. Also, in September 2016, Dekko acquired Electri-Cable Assemblies (ECA), a Shelton, CT-based manufacturer of power, data and electrical solutions for the office furniture industry.
The Graham Healthcare Group (GHG) provides home health and hospice services in six states. In June 2016, the Company acquired the outstanding 20% redeemable noncontrolling interest in Residential Healthcare (Residential). Also in June 2016, Celtic Healthcare (Celtic) and Residential combined their business operations and the Company now owns 90% of the combined entity, known as GHG. The Company incurred approximately $2.0 million in expenses in conjunction with these transactions in the second quarter of 2016. Healthcare revenues increased 8% in 2016 due primarily to patient growth for both home health and hospice. Operating results were down in 2016, largely due to the expenses incurred related to the transactions in the second quarter of 2016 and an increase in information systems and other integration costs.
In June 2016, Residential and a Michigan hospital formed a joint venture to provide home health services to West Michigan patients. Residential manages the operations of the joint venture and holds a 40% interest. The pro rata operating results of the joint venture are included in the Company’s equity in earnings of affiliates. In connection with this transaction, the Company recorded a pre-tax gain of $3.2 million in the second quarter of 2016 that is included in other non-operating income.

58