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v2.3.0.15
Segment Information
9 Months Ended
Sep. 30, 2011
Segment Information 
Segment Information

6. Segment Information

 

The Company’s management evaluates revenues for three business divisions: telecommunication services, payments and financial services. The Company operates as one reportable segment since the chief operating decision maker allocates resources based on the consolidated financial results.

 

Revenue for the Company’s three business divisions is presented below (in thousands):

 

 

 

Three months ended
September 30,

 

Nine months ended
September 30,

 

 

 

2010

 

2011

 

2010

 

2011

 

Revenues:

 

 

 

 

 

 

 

 

 

Telecommunication services

 

$

64,652

 

$

74,471

 

$

194,375

 

$

214,402

 

Payments

 

49,380

 

51,278

 

143,832

 

152,408

 

Financial services

 

16,545

 

16,982

 

49,613

 

50,596

 

Total revenues

 

$

130,577

 

$

142,731

 

$

387,820

 

417,406

 

 

Management evaluates the Company’s performance on EBITDA before stock compensation expense. The Company defines EBITDA before stock compensation expense as net income before loss from discontinued operations, depreciation, amortization, stock compensation expense, interest expense, other income (expense), equity in net loss of unconsolidated affiliate, contingent consideration expense, milestone compensation expense and provision for income taxes. EBITDA before stock compensation expense is not a generally accepted accounting principle measure, but rather a measure employed by management to view operating results. The Company believes that this measure, viewed in addition to and not in lieu of the Company’s reported GAAP results, provides additional useful information to the investors regarding the Company’s performance and overall operating results exclusive of selected significant non-cash items. This metric is frequently requested by investors and is also an integral part of the Company’s internal reporting to measure the performance of senior management. The Company’s definition of EBITDA before stock compensation expense may not be comparable to similarly titled measures used by other entities.

 

EBITDA before stock compensation expense was approximately $35.2 million and $36.4 million, and $100.8 million and $103.2 million, for the three and nine months ended September 30, 2010 and 2011, respectively. Management evaluates performance before consideration of certain intercompany transactions. Accordingly, these transactions are not reflected in EBITDA. In addition, certain corporate expenses are reflected consistent with information reviewed by our chief operating decision maker.

 

EBITDA before stock compensation expense differs from net income reported in the condensed consolidated statements of operations as follows (in thousands):

 

 

 

Three months ended
September 30,

 

Nine months ended
September 30,

 

 

 

2010

 

2011

 

2010

 

2011

 

EBITDA before stock compensation expense

 

$

35,248

 

$

36,365

 

$

100,850

 

$

103,205

 

Reconciling items:

 

 

 

 

 

 

 

 

 

Depreciation and amortization of property and equipment

 

(11,462

)

(10,912

)

(35,231

)

(33,838

)

Amortization of intangible assets

 

(8,547

)

(9,888

)

(28,430

)

(30,070

)

Stock compensation expense

 

(1,418

)

(1,720

)

(4,987

)

(4,170

)

Interest expense

 

(5,746

)

(6,266

)

(17,692

)

(19,394

)

Interest income and other income (expense), net

 

(2,556

)

(98

)

3,376

 

(1,279

)

Milestone compensation expense

 

 

(526

)

 

(667

)

Contingent consideration expense

 

 

(918

)

 

(1,668

)

Equity in net loss of unconsolidated affiliate

 

(224

)

 

 

(289

)

 

 

Provision for income taxes

 

(987

)

(3,901

)

(5,763

)

(7,278

)

Loss on discontinued operations

 

(287

)

(538

)

(212

)

(1,391

)

Net income

 

$

4,021

 

$

1,598

 

$

11,622

 

$

3,450

 

 

Geographic Information

 

The Company sells its services through foreign subsidiaries in Australia, Austria, Bermuda, Canada, France, Germany, Hong Kong, India, Ireland, Italy, Japan, Malaysia, Mexico, the Netherlands, New Zealand, Poland, Romania, Singapore, South Korea, Spain, Sweden, Thailand, Turkey and the United Kingdom. Information regarding revenues and long-lived tangible assets attributable to each geographic region is stated below.

 

The Company’s revenues were generated in the following geographic regions (in thousands):

 

 

 

Three months ended
September 30,

 

Nine months ended
September 30,

 

 

 

2010

 

2011

 

2010

 

2011

 

Telecommunications Services Division

 

 

 

 

 

 

 

 

 

North America

 

$

64,652

 

$

74,471

 

$

194,375

 

$

214,402

 

Payments Division

 

 

 

 

 

 

 

 

 

North America

 

$

16,478

 

$

14,331

 

$

49,951

 

$

44,643

 

Europe

 

25,783

 

28,208

 

73,895

 

82,692

 

Asia-Pacific

 

7,119

 

8,739

 

19,986

 

25,073

 

 

 

$

49,380

 

$

51,278

 

$

143,832

 

$

152,408

 

Financial Services Division

 

 

 

 

 

 

 

 

 

North America

 

$

11,305

 

$

10,850

 

$

34,493

 

$

33,061

 

Europe

 

3,093

 

3,471

 

9,238

 

10,118

 

Asia-Pacific

 

2,147

 

2,661

 

5,882

 

7,417

 

 

 

$

16,545

 

$

16,982

 

$

49,613

 

$

50,596

 

Total

 

 

 

 

 

 

 

 

 

North America

 

$

92,435

 

$

99,652

 

$

278,819

 

$

292,106

 

Europe

 

28,876

 

31,679

 

83,133

 

92,810

 

Asia-Pacific

 

9,266

 

11,400

 

25,868

 

32,490

 

Total Revenues

 

$

130,577

 

$

142,731

 

$

387,820

 

$

417,406

 

 

The Company’s long-lived assets, including goodwill and intangible assets, were located as follows (in thousands):

 

 

 

December 31,
2010

 

September 30,
2011

 

North America

 

$

440,536

 

$

408,065

 

Europe

 

19,343

 

17,612

 

Asia-Pacific

 

20,235

 

22,818

 

Total long lived assets

 

$

480,114

 

$

448,495