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  • 10-Q (Aug 8, 2017)
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  • 10-Q (Nov 6, 2015)

 
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Forrester Research 10-Q 2016

Documents found in this filing:

  1. 10-Q
  2. Ex-31.1
  3. Ex-31.2
  4. Ex-32.1
  5. Ex-32.2
  6. Ex-32.2
forr-10q_20160630.htm

 

 

FORM 10-Q

 

(MARK ONE)

x

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934.

FOR THE QUARTERLY PERIOD ENDED June 30, 2016

OR

o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934.

COMMISSION FILE NUMBER: 000-21433

 

FORRESTER RESEARCH, INC.

(Exact name of registrant as specified in its charter)

 

 

DELAWARE

 

04-2797789

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification Number)

 

 

 

60 Acorn Park Drive

CAMBRIDGE, MASSACHUSETTS

 

02140

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code: (617) 613-6000

 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x     No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x     No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer

 

¨

  

Accelerated filer

 

x

 

 

 

 

 

 

 

Non-accelerated filer

 

¨  (Do not check if a smaller reporting company)

  

Smaller reporting company

 

¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o     No  x

As of August 4, 2016 18,060,000 shares of the registrant’s common stock were outstanding.

 

 

 

 

 


 

FORRESTER RESEARCH, INC.

INDEX TO FORM 10-Q

 

 

  

PAGE

 

PART I. FINANCIAL INFORMATION

  

3

 

ITEM 1. Financial Statements (Unaudited)

  

3

 

Consolidated Balance Sheets as of June 30, 2016 and December 31, 2015

  

3

 

Consolidated Statements of Income for the Three and Six Months Ended June 30, 2016 and 2015

  

4

 

Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2016 and 2015

  

5

 

Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2016 and 2015

  

6

 

Notes to Consolidated Financial Statements

  

7

 

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

  

15

 

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

  

23

 

ITEM 4. Controls and Procedures

  

23

 

PART II. OTHER INFORMATION

  

24

 

ITEM 1A. Risk Factors

  

24

 

ITEM 6. Exhibits

  

25

  

 

 

 

 

2


 

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

FORRESTER RESEARCH, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data, unaudited)

 

 

 

June 30,

 

 

December 31,

 

 

 

2016

 

 

2015

 

ASSETS

 

Current Assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

68,856

 

 

$

53,331

 

Marketable investments (Note 3)

 

 

57,673

 

 

 

47,775

 

Accounts receivable, net

 

 

42,714

 

 

 

67,355

 

Deferred commissions

 

 

11,576

 

 

 

13,529

 

Prepaid expenses and other current assets

 

 

14,208

 

 

 

15,737

 

Total current assets

 

 

195,027

 

 

 

197,727

 

Property and equipment, net

 

 

25,833

 

 

 

27,569

 

Goodwill

 

 

74,444

 

 

 

74,071

 

Intangible assets, net

 

 

1,933

 

 

 

2,334

 

Other assets

 

 

18,837

 

 

 

17,290

 

Total assets

 

$

316,074

 

 

$

318,991

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

Current Liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

694

 

 

$

525

 

Accrued expenses and other current liabilities

 

 

30,648

 

 

 

41,252

 

Deferred revenue

 

 

138,597

 

 

 

140,676

 

Total current liabilities

 

 

169,939

 

 

 

182,453

 

Non-current liabilities

 

 

9,436

 

 

 

9,236

 

Total liabilities

 

 

179,375

 

 

 

191,689

 

 

 

 

 

 

 

 

 

 

Stockholders' Equity (Note 7):

 

 

 

 

 

 

 

 

Preferred stock, $0.01 par value

 

 

 

 

 

 

 

 

Authorized - 500 shares; issued and outstanding - none

 

 

 

 

 

 

Common stock, $0.01 par value

 

 

 

 

 

 

 

 

Authorized - 125,000 shares

 

 

 

 

 

 

 

 

Issued - 21,258 and 21,063 shares as of June 30, 2016 and December 31, 2015,

respectively

 

 

 

 

 

 

 

 

Outstanding - 17,947 and 17,752 shares as of June 30, 2016 and December 31, 2015, respectively

 

 

213

 

 

 

211

 

Additional paid-in capital

 

 

141,869

 

 

 

134,967

 

Retained earnings

 

 

119,456

 

 

 

117,135

 

Treasury stock - 3,311 shares as of June 30, 2016 and December 31, 2015,

  at cost

 

 

(120,185

)

 

 

(120,185

)

Accumulated other comprehensive loss

 

 

(4,654

)

 

 

(4,826

)

Total stockholders’ equity

 

 

136,699

 

 

 

127,302

 

Total liabilities and stockholders’ equity

 

$

316,074

 

 

$

318,991

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

3


 

FORRESTER RESEARCH, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data, unaudited)

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30,

 

June 30,

 

 

2016

 

 

2015

 

2016

 

 

2015

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research services

$

55,023

 

 

$

52,604

 

$

108,271

 

 

$

104,462

 

Advisory services and events

 

32,798

 

 

 

30,207

 

 

56,951

 

 

 

53,536

 

Total revenues

 

87,821

 

 

 

82,811

 

 

165,222

 

 

 

157,998

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of services and fulfillment

 

34,417

 

 

 

32,560

 

 

65,540

 

 

 

63,321

 

Selling and marketing

 

29,335

 

 

 

28,481

 

 

59,739

 

 

 

58,112

 

General and administrative

 

10,300

 

 

 

9,276

 

 

20,273

 

 

 

19,034

 

Depreciation

 

2,076

 

 

 

2,096

 

 

4,041

 

 

 

4,203

 

Amortization of intangible assets

 

210

 

 

 

224

 

 

419

 

 

 

445

 

Reorganization costs

 

11

 

 

 

81

 

 

1,026

 

 

 

3,505

 

Total operating expenses

 

76,349

 

 

 

72,718

 

 

151,038

 

 

 

148,620

 

Income from operations

 

11,472

 

 

 

10,093

 

 

14,184

 

 

 

9,378

 

Other income (expense), net

 

473

 

 

 

(99

)

 

145

 

 

 

183

 

Gains (losses) on investments, net

 

(54

)

 

 

10

 

 

(54

)

 

 

(9

)

Income before income taxes

 

11,891

 

 

 

10,004

 

 

14,275

 

 

 

9,552

 

Income tax provision

 

4,431

 

 

 

4,254

 

 

5,526

 

 

 

4,026

 

Net income

$

7,460

 

 

$

5,750

 

$

8,749

 

 

$

5,526

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic income per common share

$

0.42

 

 

$

0.32

 

$

0.49

 

 

$

0.31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted income per common share

$

0.41

 

 

$

0.31

 

$

0.49

 

 

$

0.30

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic weighted average common shares outstanding

 

17,863

 

 

 

18,007

 

 

17,812

 

 

 

18,033

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted weighted average common shares outstanding

 

18,145

 

 

 

18,268

 

 

18,035

 

 

 

18,314

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per common share

$

0.18

 

 

$

0.17

 

$

0.36

 

 

$

0.34

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

4


 

FORRESTER RESEARCH, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands, unaudited)

 

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

June 30,

 

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Net income

$

7,460

 

 

$

5,750

 

 

$

8,749

 

 

$

5,526

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss), net of taxes:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation

 

(1,429

)

 

 

1,067

 

 

 

52

 

 

 

(1,933

)

Net change in market value of investments

 

3

 

 

 

(51

)

 

 

120

 

 

 

47

 

Other comprehensive income (loss)

 

(1,426

)

 

 

1,016

 

 

 

172

 

 

 

(1,886

)

Comprehensive income

$

6,034

 

 

$

6,766

 

 

$

8,921

 

 

$

3,640

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

5


 

FORRESTER RESEARCH, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, unaudited)

 

 

Six Months Ended

 

 

June 30,

 

 

2016

 

 

2015

 

 

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net income

$

8,749

 

 

$

5,526

 

Adjustments to reconcile net income to net cash provided by operating

   activities:

 

 

 

 

 

 

 

Depreciation

 

4,041

 

 

 

4,203

 

Amortization of intangible assets

 

419

 

 

 

445

 

Net losses from investments

 

54

 

 

 

9

 

Deferred income taxes

 

(1,409

)

 

 

(1,514

)

Stock-based compensation

 

3,761

 

 

 

3,661

 

Amortization of premium on investments

 

187

 

 

 

381

 

Foreign currency losses

 

147

 

 

 

70

 

Changes in assets and liabilities

 

 

 

 

 

 

 

Accounts receivable

 

24,445

 

 

 

24,353

 

Deferred commissions

 

1,953

 

 

 

2,769

 

Prepaid expenses and other current assets

 

892

 

 

 

(511

)

Accounts payable

 

189

 

 

 

(195

)

Accrued expenses and other liabilities

 

(10,891

)

 

 

(7,268

)

Deferred revenue

 

(1,915

)

 

 

(7,168

)

Net cash provided by operating activities

 

30,622

 

 

 

24,761

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Purchases of property and equipment

 

(2,318

)

 

 

(1,678

)

Purchases of marketable investments

 

(23,902

)

 

 

(18,575

)

Proceeds from sales and maturities of marketable investments

 

14,025

 

 

 

12,478

 

Other investing activity

 

(35

)

 

 

266

 

Net cash used in investing activities

 

(12,230

)

 

 

(7,509

)

Cash flows from financing activities:

 

 

 

 

 

 

 

Dividends paid on common stock

 

(6,428

)

 

 

(6,126

)

Repurchases of common stock

 

 

 

 

(11,786

)

Proceeds from issuance of common stock under employee equity

   incentive plans

 

4,147

 

 

 

1,906

 

Excess tax benefits from stock-based compensation

 

70

 

 

 

31

 

Net cash used in financing activities

 

(2,211

)

 

 

(15,975

)

Effect of exchange rate changes on cash and cash equivalents

 

(656

)

 

 

(764

)

Net increase in cash and cash equivalents

 

15,525

 

 

 

513

 

Cash and cash equivalents, beginning of period

 

53,331

 

 

 

49,650

 

Cash and cash equivalents, end of period

$

68,856

 

 

$

50,163

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

 

6


 

FORRESTER RESEARCH, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

 

Note 1 — Interim Consolidated Financial Statements

Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for reporting on Form 10-Q. Accordingly, certain information and footnote disclosures required for complete financial statements are not included herein. The year-end balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. It is recommended that these financial statements be read in conjunction with the consolidated financial statements and related notes that appear in the Forrester Research, Inc. (“Forrester”) Annual Report on Form 10-K for the year ended December 31, 2015. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of the financial position, results of operations, comprehensive income and cash flows as of the dates and for the periods presented have been included. The results of operations for the three and six months ended June 30, 2016 may not be indicative of the results for the year ending December 31, 2016, or any other period.

Fair Value Measurements

The carrying amounts reflected in the Consolidated Balance Sheets for cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses approximate fair value due to their short-term maturities. See Note 3 – Marketable Investments - for the fair value of the Company’s marketable investments.

 

 

Note 2 — Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss) are as follows (in thousands):

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Net Unrealized Gain

 

 

Cumulative

 

 

Accumulated

 

 

 

(Loss) on Marketable

 

 

Translation

 

 

Other Comprehensive

 

 

 

Investments

 

 

Adjustment

 

 

Income (Loss)

 

Balance at January 1, 2016

 

$

(100

)

 

$

(4,726

)

 

$

(4,826

)

Foreign currency translation

 

 

 

 

 

52

 

 

 

52

 

Unrealized gain on investments, net of tax of $79

 

 

120

 

 

 

 

 

 

120

 

Balance at June 30, 2016

 

$

20

 

 

$

(4,674

)

 

$

(4,654

)

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Net Unrealized Gain

 

 

Cumulative

 

 

Accumulated

 

 

 

(Loss) on Marketable

 

 

Translation

 

 

Other Comprehensive

 

 

 

Investments

 

 

Adjustment

 

 

Income (Loss)

 

Balance at April 1, 2016

 

$

17

 

 

$

(3,245

)

 

$

(3,228

)

Foreign currency translation

 

 

 

 

 

(1,429

)

 

 

(1,429

)

Unrealized gain on investments, net of tax of $3

 

 

3

 

 

 

 

 

 

3

 

Balance at June 30, 2016

 

$

20

 

 

$

(4,674

)

 

$

(4,654

)

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Net Unrealized Gain

 

 

Cumulative

 

 

Accumulated

 

 

 

(Loss) on Marketable

 

 

Translation

 

 

Other Comprehensive

 

 

 

Investments

 

 

Adjustment

 

 

Income (Loss)

 

Balance at January 1, 2015

 

$

(74

)

 

$

(1,539

)

 

$

(1,613

)

Foreign currency translation before reclassification

 

 

 

 

 

(2,251

)

 

 

(2,251

)

Reclassification adjustment for write-off of foreign

   currency translation loss

 

 

 

 

 

318

 

 

 

318

 

Unrealized gain on investments, net of tax of $29

 

 

47

 

 

 

 

 

 

47

 

Balance at June 30, 2015

 

$

(27

)

 

$

(3,472

)

 

$

(3,499

)

 

7


 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Net Unrealized Gain

 

 

Cumulative

 

 

Accumulated

 

 

 

(Loss) on Marketable

 

 

Translation

 

 

Other Comprehensive

 

 

 

Investments

 

 

Adjustment

 

 

Income (Loss)

 

Balance at April 1, 2015

 

$

24

 

 

$

(4,539

)

 

$

(4,515

)

Foreign currency translation before reclassification

 

 

 

 

 

749

 

 

 

749

 

Reclassification adjustment for write-off of foreign

   currency translation loss

 

 

 

 

 

318

 

 

 

318

 

Unrealized loss on investments, net of tax of $33

 

 

(51

)

 

 

 

 

 

(51

)

Balance at June 30, 2015

 

$

(27

)

 

$

(3,472

)

 

$

(3,499

)

 

 

 

Note 3 — Marketable Investments

The following table summarizes the Company’s marketable investments (in thousands):

 

 

 

As of  June 30, 2016

 

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Market

 

 

 

Cost

 

 

Gains

 

 

Losses

 

 

Value

 

Corporate obligations

 

$

57,639

 

 

$

50

 

 

$

(16

)

 

$

57,673

 

 

 

 

As of December 31, 2015

 

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Market

 

 

 

Cost

 

 

Gains

 

 

Losses

 

 

Value

 

Corporate obligations

 

$

47,939

 

 

$

 

 

$

(164

)

 

$

47,775

 

 

Realized gains and losses on securities are included in earnings and are determined using the specific identification method. Realized gains or losses on the sale of the Company’s corporate obligations were not material in the three and six months ended June 30, 2016 or 2015.

The following table summarizes the maturity periods of the marketable securities in the Company’s portfolio as of June 30, 2016 (in thousands).

 

 

 

FY 2016

 

 

FY 2017

 

 

FY 2018

 

 

Total

 

Corporate obligations

 

$

9,071

 

 

$

34,789

 

 

$

13,813

 

 

$

57,673

 

 

The following table shows the gross unrealized losses and market value of Forrester’s available-for-sale securities with unrealized losses that are not deemed to be other-than-temporary, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position (in thousands):

 

 

 

As of  June 30, 2016

 

 

 

Less Than 12 Months

 

 

12 Months or Greater

 

 

 

Market

 

 

Unrealized

 

 

Market

 

 

Unrealized

 

 

 

Value

 

 

Losses

 

 

Value

 

 

Losses

 

Corporate obligations

 

$

20,531

 

 

$

16

 

 

$

 

 

$

 

 

 

 

As of December 31, 2015

 

 

 

Less Than 12 Months

 

 

12 Months or Greater

 

 

 

Market

 

 

Unrealized

 

 

Market

 

 

Unrealized

 

 

 

Value

 

 

Losses

 

 

Value

 

 

Losses

 

Corporate obligations

 

$

45,748

 

 

$

158

 

 

$

2,027

 

 

$

6

 

 

 

8


 

Fair Value

The Company measures certain financial assets at fair value on a recurring basis, including cash equivalents and available-for-sale securities. The fair values of these financial assets have been classified as Level 1, 2 or 3 within the fair value hierarchy as described in the accounting standards for fair value measurements.

Level 1 — Fair value based on quoted prices in active markets for identical assets or liabilities.

Level 2 — Fair value based on inputs other than Level 1 inputs that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 — Fair value based on unobservable inputs that are supported by little or no market activity and such inputs are significant to the fair value of the assets or liabilities.

The following table represents the Company’s fair value hierarchy for its financial assets (cash equivalents and investments) measured at fair value on a recurring basis (in thousands):

 

 

 

As of  June 30, 2016

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Money market funds (1)

 

$

866

 

 

$

 

 

$

 

 

$

866

 

Corporate obligations

 

 

 

 

 

57,673

 

 

 

 

 

 

57,673

 

Total

 

$

866

 

 

$

57,673

 

 

$

 

 

$

58,539

 

 

 

 

As of December 31, 2015

 

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Money market funds (1)

 

$

325

 

 

$

 

 

$

 

 

$

325

 

Corporate obligations

 

 

 

 

 

47,775

 

 

 

 

 

 

47,775

 

Total

 

$

325

 

 

$

47,775

 

 

$

 

 

$

48,100

 

 

(1)

Included in cash and cash equivalents. 

Level 2 assets consist of the Company’s entire portfolio of corporate obligations. Level 2 assets have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, typically utilizing third party pricing services or other market observable data. The pricing services utilize industry standard valuation methods, including both income and market based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events.

 

 

Note 4 — Non-Marketable Investments

At June 30, 2016 and December 31, 2015, the carrying value of the Company’s non-marketable investments, which were composed primarily of interests in technology-related private equity funds, was $3.6 million and is included in other assets in the Consolidated Balance Sheets.

One of the Company’s investments, with a book value of $0.4 million at June 30, 2016 and December 31, 2015, is being accounted for using the cost method and, accordingly, is valued at cost unless an other-than-temporary impairment in its value occurs. The other investments are being accounted for using the equity method as the investments are limited partnerships and the Company has an ownership interest in excess of 5% and, accordingly, the Company records its share of the investee’s operating results each period. Gains and losses from non-marketable investments were insignificant during the three and six months ended June 30, 2016 and 2015, and are included in gains (losses) on investments, net in the Consolidated Statements of Income. No distributions were received from the funds during the six months ended June 30, 2016. During the six months ended June 30, 2015, distributions of $0.1 million were received from the funds.

 

 

 

9


 

 

Note 5 — Reorganization

 

In the first quarter of 2016, the Company implemented a reduction in its workforce of approximately 2% of its employees across various geographies and functions. The Company recorded $1.0 million of severance and related costs for this action during the three months ended March 31, 2016. All costs under this plan are expected to be paid during 2016.

In the first quarter of 2015, the Company implemented a reduction in its workforce of approximately 4% of its employees across various geographies and functions, in order to reallocate investment in 2015 to planned sales expansion and to delivery areas seeing the greatest client demand. The Company incurred $(0.2) million and $3.2 million of severance and related costs for this action during the three and six months ended June 30, 2015. In addition, the Company incurred $0.3 million during the three months ended June 30, 2015 primarily for a non-cash charge for the liquidation of a small non-U.S. subsidiary.

The following table rolls forward the activity in the reorganization accrual for the six months ended June 30, 2016 (in thousands):

 

 

 

Workforce

 

 

Subsidiary

 

 

Products Group

 

 

 

 

 

 

 

Reduction