Segment Information

12 Months Ended

Dec. 31, 2013

Segment Information

Note 19. Segment Information

The Company operates primarily in the print and related services industry, with product and service offerings designed to offer customers complete solutions for communicating their messages to target audiences.

During the fourth quarter of 2013, management changed the Company’s reportable segments to reflect changes in the management reporting structure of the organization and the manner in which the chief operating decision maker regularly assesses information for decision-making purposes, including allocation of resources. The revised reporting structure includes four operating segments: “Publishing and Retail Services,” “Variable Print,” “Strategic Services,” and “International.” All prior periods have been reclassified to conform to the current reporting structure.

The Company’s segments and their product and service offerings are summarized below:

Publishing and Retail Services

The Publishing and Retail Services segment’s primary product offerings include magazines, catalogs, retail inserts, books, directories and packaging.

The Publishing and Retail Services segment accounted for 26.5% of the Company’s consolidated net sales in 2013.

Variable Print

The Variable Print segment includes the Company’s U.S. short-run and transactional printing operations. This segment’s primary product offerings include commercial and digital print, direct mail, labels, statement printing, office products, forms and packaging.

The Variable Print segment accounted for 24.7% of the Company’s consolidated net sales in 2013.

Strategic Services

The Strategic Services segment includes the Company’s financial print products and related services, logistics services, digital and creative solutions and print management offerings.

The Strategic Services segment accounted for 23.4% of the Company’s consolidated net sales in 2013.

International

The International segment includes the Company’s non-U.S. printing operations in Asia, Europe, Latin America and Canada. This segment’s product and service offerings include magazines, catalogs, retail inserts, books, directories, direct mail, packaging, forms, labels, manuals, statement printing, commercial and digital print, logistics services and digital and creative solutions. Additionally, this segment includes the Company’s business process outsourcing and Global Turnkey Solutions operations. Business process outsourcing provides transactional print and outsourcing services, statement printing, direct mail and print management offerings through its operations in Europe, Asia and North America. Global Turnkey Solutions provides outsourcing capabilities, including product configuration, customized kitting and order fulfillment for technology, medical device and other companies around the world through its operations in Europe, North America and Asia.

The International segment accounted for 25.4% of the Company’s consolidated net sales in 2013.

Corporate

Corporate consists of unallocated selling, general and administrative activities and associated expenses including, in part, executive, legal, finance, communications, certain facility costs and LIFO inventory provisions. In addition, certain costs and earnings of employee benefit plans, such as pension and other postretirement benefits plan expense and share-based compensation, are included in Corporate and not allocated to the operating segments. Corporate also manages the Company’s cash pooling structures, which enables participating international locations to draw on the Company’s overseas cash resources to meet local liquidity needs.

Information by Segment

The Company has disclosed income (loss) from operations as the primary measure of segment earnings (loss). This is the measure of profitability used by the Company’s chief operating decision-maker and is most consistent with the presentation of profitability reported within the Consolidated Financial Statements.

	Total Sales		Intersegment Sales			Net Sales		Income(Loss) from Operations			Assets of Operations		Depreciation and Amortization		Capital Expenditures
Year ended December 31, 2013
Publishing and Retail Services	$	2,777.7	$	(2.9	)	$	2,774.8	$	109.6		$	1,369.6	$	166.0	$	57.7
Variable Print		2,650.7		(57.9	)		2,592.8		197.9			1,567.1		103.4		63.4
Strategic Services		2,587.7		(134.7	)		2,453.0		232.8			1,355.6		58.4		34.9
International		2,746.9		(87.2	)		2,659.7		147.3			2,060.0		102.5		50.8
Total operating segments		10,763.0		(282.7	)		10,480.3		687.6			6,352.3		430.3		206.8
Corporate		—		—			—		(107.9	)		885.9		5.5		9.8
Total operations	$	10,763.0	$	(282.7	)	$	10,480.3	$	579.7		$	7,238.2	$	435.8	$	216.6
Year ended December 31, 2012
Publishing and Retail Services	$	2,938.3	$	(18.8	)	$	2,919.5	$	(659.4	)	$	1,517.8	$	213.5	$	57.8
Variable Print		2,697.5		(60.3	)		2,637.2		202.1			1,616.0		103.8		42.7
Strategic Services		2,210.2		(144.8	)		2,065.4		59.0			1,404.3		52.3		39.9
International		2,678.6		(78.8	)		2,599.8		91.6			2,192.1		105.8		43.9
Total operating segments		10,524.6		(302.7	)		10,221.9		(306.7	)		6,730.2		475.4		184.3
Corporate		—		—			—		(63.1	)		532.5		6.2		21.6
Total operations	$	10,524.6	$	(302.7	)	$	10,221.9	$	(369.8	)	$	7,262.7	$	481.6	$	205.9
Year ended December 31, 2011
Publishing and Retail Services	$	3,205.2	$	(30.1	)	$	3,175.1	$	227.6		$	2,529.5	$	240.2	$	51.7
Variable Print		2,825.8		(61.8	)		2,764.0		(204.7	)		1,651.8		135.7		54.2
Strategic Services		2,196.1		(137.3	)		2,058.8		180.6			1,541.6		48.2		34.6
International		2,682.8		(69.7	)		2,613.1		23.6			2,213.8		116.2		91.1
Total operating segments		10,909.9		(298.9	)		10,611.0		227.1			7,936.7		540.3		231.6
Corporate		—		—			—		(161.9	)		345.0		9.6		19.3
Total operations	$	10,909.9	$	(298.9	)	$	10,611.0	$	65.2		$	8,281.7	$	549.9	$	250.9

Corporate assets primarily consisted of the following items at December 31, 2013, 2012 and 2011:

	2013			2012			2011
Cash and cash equivalents	$	494.9		$	(137.2	)	$	(138.1	)
Current and deferred income tax assets net of valuation allowances		39.2			324.5			152.7
Property, plant and equipment, net		61.7			60.7			81.8
Software, net		71.1			71.8			53.1
Deferred compensation plan assets		63.0			57.2			50.6
LIFO reserves		(92.0	)		(92.1	)		(96.4	)

Restructuring, impairment and other charges by segment for 2013, 2012 and 2011 are described in Note 3.