Chegg 2015 Annual Report Download - page 88

Download and view the complete annual report

Please find page 88 of the 2015 Chegg annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 139

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139

Table of Contents
49
Restructuring Charges
For the year ended December 31, 2015, we recorded restructuring charges of $4.9 million related to the exit from our
print coupon business and closing our Kentucky warehouse. These charges include one-time employee termination benefits for
approximately 71 employees of $1.9 million and lease termination and other costs of $3.0 million. As a result of our strategic
partnership with Ingram, we have successfully exited our warehouse facilities in the year ended December 31, 2015. Costs
incurred to date related to employee termination benefits are expected to be paid within the next three months. Costs incurred to
date related to the lease termination and other costs are expected to be fully paid by 2021.
Gain on Liquidation of Textbooks
During the years ended December 31, 2015, 2014 and 2013, we had a gain on liquidation of print textbooks of $4.3
million, $4.6 million and $1.2 million, respectively, resulting from proceeds received from liquidation of previously rented
print textbooks on our website and through various other liquidation channels.
Interest Expense and Other Income, Net
The following table sets forth our interest expense and other income, net, for the periods shown (dollars in thousands):
Year Ended
December 31, Change in 2015 Change in 2014
2015 2014 2013 $ % $ %
Interest expense, net . . . . . . . . . . . . . . $ (247) $ (317) $ (3,818) $ 70 (22)% 3,501 (92)%
Other income (expense), net. . . . . . . . 216 879 (359)(663) (75) 1,238 (345)
Total interest expense and other
income (expense), net. . . . . . . . . . . . . $ (31) $ 562 $ (4,177) $ (593) (106)% 4,739 (113)%
Interest expense, net decreased during the year ended December 31, 2015 compared to the same period in 2014. In the
year ended December 31, 2015, we reduced our line of credit to $30.0 million. Interest expense, net decreased by $3.5
million during the year ended December 31, 2014 primarily due to the pay-off of our outstanding loan balance in 2013.
Other income (expense), net decreased during the year ended December 31, 2015 compared to the same period in 2014,
primarily due to the interest earned on our investments. Other income (expense), net was a net income during the year
ended December 31, 2014, primarily due to the interest earned on our investments.
Provision for Income Taxes
The following table sets forth our provision for income taxes for the periods shown (dollars in thousands):
Year Ended
December 31, Change in 2015 Change in 2014
2015 2014 2013 $ % $ %
Provision for income taxes . . . . . . . . . $ 1,479 $ 186 $ 642 $ 1,293 695% (456) (71)%
We recorded an income tax provision of approximately $1.5 million for the year ended December 31, 2015, which was
primarily due to state and foreign income tax expense and federal tax expense related to the tax amortization of acquired
indefinite lived intangible assets. We recorded an income tax provision of approximately $0.2 million in the year
ended December 31, 2014 primarily the result of the release of a valuation allowance of $1.3 million resulting from our
acquisition of InstaEDU, offset by foreign and state income taxes. We recorded an income tax provision of $0.6 million in the
year ended December 31, 2013 that was comprised of state and foreign income tax expense.