Assets Held for Sale

9 Months Ended

Sep. 30, 2024

Discontinued Operations and Disposal Groups [Abstract]

Effective during the third quarter of 2024, the Company, having the authority to approve the action, committed to a plan to sell the majority of its European operations as part of an ongoing strategic focus to optimize its business portfolio for growth as a marketing experience company. Accordingly, as of September 30, 2024, the Company has classified the majority of its European operations as held for sale, as required by ASC 360-10 – “Long Lived Assets”. The majority of its European operations primarily consists of all employees and facilities for Quad/Graphics Europe print and ink manufacturing headquartered in Wyszkow, Poland; the Peppermint agency in Warsaw, Poland; and Quad Point of Sale (including Marin’s International SAS), which has locations throughout Europe. The Company’s European operations has historically been included within the International segment and reporting unit.

The following table summarizes the components of the European operations classified as held for sale on the condensed consolidated balance sheet as of September 30, 2024:


	September 30, 2024
Cash	$	1.4
Receivables, Net	23.2
Inventories	9.6
Prepaid expenses and other current assets	1.4
Included in prepaids and other current assets	$	35.6

Property, plant and equipment—net	$	30.3
Operating lease right-of-use assets—net	1.9
Other long-term assets	4.5
Included in other long-term assets	$	36.7

Accounts payable	$	14.6
Other current liabilities	7.9
Short-term debt and current portion of long-term debt	9.9
Current portion of finance lease obligations	1.4
Current portion of operating lease obligations	0.9
Included in other current liabilities	$	34.7

Finance lease obligations	$	3.6
Operating lease obligations	1.0
Other long-term liabilities	1.0
Included in other long-term liabilities	$	5.6

Restructuring reserve (included in other current liabilities)	$	38.3

Cumulative translation adjustments (loss) (included in accumulated other comprehensive loss)	$	(38.3)

The Company recognized non-cash impairment charges of $50.9 million during the third quarter of 2024, to reduce the carrying value of the majority of the European operations to its estimated fair value, including $38.3 million of non-cash impairment of foreign currency translation adjustments and $12.6 million of non-cash impairment of tangible property, plant and equipment. The fair value of the assets held for sale were determined by the Company to be Level 2 under the fair value hierarchy (see Note 10, “Financial Instruments and Fair Value Measurements,” for the definition of Level 2 inputs) and were estimated based on expected net proceeds.

On October 22, 2024, the Company announced it entered into a definitive agreement with Germany-based entrepreneurial private capital investment manager Capmont GmbH to sell the majority of the European operations. The expected net proceeds are approximately $32.0 million. The sale is expected to close by December 31, 2024, pending customary regulatory clearances and other closing conditions.