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Segment Reporting | 12 Months Ended
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Dec. 31, 2014
Segment Reporting [Abstract] |
Segment Reporting | NOTE 14. SEGMENT REPORTING Prior to January 1, 2013, we operated primarily through three business segments: diagnostic and information technology-based products and services for the veterinary market, which we continue to refer to as CAG; water quality products (“Water”); and diagnostic products for livestock and poultry health, which we referred to as Livestock and Poultry Diagnostics. We also operated two smaller operating segments that comprised products for milk quality and safety (“Dairy”) and products for the human point-of-care medical diagnostics market (“OPTI Medical”). Financial information about our Dairy and OPTI Medical operating segments was combined and presented with our remaining pharmaceutical product line and our out-licensing arrangements in an “Other” category because they did not meet the quantitative or qualitative thresholds for reportable segments. In 2013, we combined the management of our Livestock and Poultry Diagnostics and Dairy lines of business into our LPD segment to more effectively realize the market synergies between the product lines and to achieve operational efficiencies. Our OPTI Medical operating segment remains combined and presented with our remaining pharmaceutical product line and our out-licensing arrangements in an “Other” category because they do not meet the quantitative or qualitative thresholds for reportable segments. The segment income (loss) from operations discussed within this report for the years ended December 31, 2012 has been retrospectively revised to reflect this change in the composition of our reportable segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision-maker is our Chief Executive Officer. Our operating segments include: CAG, Water, LPD, and Other. Assets are not allocated to segments for internal reporting purposes. CAG develops, designs, manufactures and distributes products and performs services for veterinarians and the bioresearch market, primarily related to diagnostics and information management. Water develops, designs, manufactures and distributes a range of products used in the detection of various microbiological parameters in water. LPD develops, designs, manufactures and distributes diagnostic tests and related instrumentation that are used to manage the health status of livestock and poultry, to improve bovine reproductive efficiency, and to ensure the quality and safety of milk and food. OPTI Medical develops, designs, manufactures and distributes point-of-care electrolyte and blood gas analyzers and related consumable products for the human medical diagnostics market. The accounting policies of our segments are the same as those described in the summary of significant accounting policies in Note 2 except for inventories, as discussed below. Intersegment revenues, which are not included in the table below, were not material for the years ended December 31, 201 4, 2013 and 201 2. Items that are not allocated to our operating segments are as follows: a portion of corporate support function and personnel-related expenses; certain manufacturing costs; corporate research and development expenses that do not align with one of our existing business or service categories; the difference between estimated and actual share-based compensation expense; and certain foreign currency exchange gains and losses. These amounts are shown under the caption “Unallocated Amounts.” We estimate our share-based compensation expense, corporate support function expenses and certain personnel-related costs and allocate the estimated expense s to the operating segments. T his allocation differs from actual expense and consequently yields a difference that is reported under the caption “Unallocated Amounts.” With respect to manufacturing costs, the costs reported in our operating segments include our standard cost for products sold and any variances from standard cost for products purchased or manufactured within the period. We capitalize these variances for inventory on hand at the end of the period to record inventory in accordance with U.S. GAAP. We then record these variances as cost of product revenue as that inventory is sold. The impact to cost of product revenue resulting from this variance capita lization and subsequent recognition is reported within the caption “Unallocated Amounts.” Additionally, in certain geographies where we maintain inventories in currencies other than the U.S. dollar, the product costs reported in our operating segments include our standard cost for products sold, which is stated at the budgeted currency exchange rate from the beginning of the fiscal year. In these geographies, the variances from standard cost for products sold related to changes in currency exchange rates are reported within the caption “Unallocated Amounts.” Below is our segment information (in thousand s):
For the Years Ended December 31, |  |  |
|  | CAG |  | Water |  | LPD |  | Other |  | Unallocated Amounts |  | Consolidated Total |
2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenue |  | $ | 1,236,855 |  | $ | 94,725 |  | $ | 127,388 |  | $ | 26,839 |  | $ | - |  | $ | 1,485,807 |
Income (loss) from operations |  | $ | 213,109 |  | $ | 39,262 |  | $ | 24,215 |  | $ | 2,479 |  | $ | (18,810) |  | $ | 260,255 |
Interest expense, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (13,700) |
Income before provision for income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 246,555 |
Provision for income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 64,604 |
Net income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 181,951 |
Less: Net income attributable to noncontrolling interest |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 45 |
Net income attributable to IDEXX Laboratories, Inc. stockholders |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 181,906 |
Depreciation and amortization |  | $ | 48,740 |  | $ | 2,553 |  | $ | 5,144 |  | $ | 2,451 |  | $ | - |  | $ | 58,888 |
Expenditures for long-lived assets (1) |  | $ | 49,270 |  | $ | 2,499 |  | $ | 4,025 |  | $ | 4,729 |  | $ | - |  | $ | 60,523 |
2013 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenue |  | $ | 1,150,169 |  | $ | 87,959 |  | $ | 113,811 |  | $ | 25,119 |  | $ | - |  | $ | 1,377,058 |
Income (loss) from operations |  | $ | 218,645 |  | $ | 37,321 |  | $ | 14,159 |  | $ | 2,405 |  | $ | (5,768) |  | $ | 266,762 |
Interest expense, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (3,501) |
Income before provision for income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 263,261 |
Provision for income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 75,467 |
Net income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 187,794 |
Less: Net loss attributable to noncontrolling interest |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (6) |
Net income attributable to IDEXX Laboratories, Inc. stockholders |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 187,800 |
Depreciation and amortization |  | $ | 45,079 |  | $ | 2,470 |  | $ | 4,906 |  | $ | 2,141 |  | $ | - |  | $ | 54,596 |
Expenditures for long-lived assets (1) |  | $ | 66,134 |  | $ | 3,254 |  | $ | 5,569 |  | $ | 2,655 |  | $ | - |  | $ | 77,612 |
2012 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Revenue |  | $ | 1,072,211 |  | $ | 84,680 |  | $ | 111,308 |  | $ | 25,139 |  | $ | - |  | $ | 1,293,338 |
Income (loss) from operations |  | $ | 203,236 |  | $ | 37,687 |  | $ | 20,808 |  | $ | 2,902 |  | $ | (2,070) |  | $ | 262,563 |
Interest expense, net |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (1,946) |
Income before provision for income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 260,617 |
Provision for income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 82,330 |
Net income |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 178,287 |
Less: Net income attributable to noncontrolling interest |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 20 |
Net income attributable to IDEXX Laboratories, Inc. stockholders |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 178,267 |
Depreciation and amortization |  | $ | 43,042 |  | $ | 2,358 |  | $ | 4,943 |  | $ | 2,065 |  | $ | - |  | $ | 52,408 |
Expenditures for long-lived assets (1) |  | $ | 47,531 |  | $ | 2,099 |  | $ | 5,767 |  | $ | 2,221 |  | $ | - |  | $ | 57,618 |
__________ (1) Expenditures for long-lived assets exclude expenditures for intangible assets. See Note 3 for information regarding acquisitions of intangible assets during the years ended December 31, 2014, 2013 and 2012. Revenue by product and service categories was as follows (in thousands):
|  | For the Years Ended December 31, |
|  |  | 2014 |  |  | 2013 |  |  | 2012 |
CAG segment revenue: |  |  |  |  |  |  |  |  |  |
CAG Diagnostics recurring revenue: |  | $ | 1,053,410 |  | $ | 973,886 |  | $ | 896,449 |
VetLab consumables |  |  | 341,397 |  |  | 312,457 |  |  | 278,818 |
VetLab service and accessories |  |  | 53,383 |  |  | 50,675 |  |  | 48,056 |
Rapid assay products |  |  | 165,647 |  |  | 169,547 |  |  | 162,232 |
Reference laboratory diagnostic and consulting services |  |  | 492,983 |  |  | 441,207 |  |  | 407,343 |
CAG Diagnostics capital instruments |  |  | 79,626 |  |  | 83,492 |  |  | 90,177 |
Customer information management and digital imaging systems |  |  | 103,819 |  |  | 92,791 |  |  | 85,585 |
CAG segment revenue |  |  | 1,236,855 |  |  | 1,150,169 |  |  | 1,072,211 |
Water segment revenue |  |  | 94,725 |  |  | 87,959 |  |  | 84,680 |
LPD segment revenue |  |  | 127,388 |  |  | 113,811 |  |  | 111,308 |
Other segment revenue |  |  | 26,839 |  |  | 25,119 |  |  | 25,139 |
Total revenue |  | $ | 1,485,807 |  | $ | 1,377,058 |  | $ | 1,293,338 |
Revenue by principal geographic area, based on customers’ domiciles, was as follows (in thousands):
|  | For the Years Ended December 31, |
|  |  | 2014 |  |  | 2013 |  |  | 2012 |
Americas |  |  |  |  |  |  |  |  |  |
United States |  | $ | 848,928 |  | $ | 802,345 |  | $ | 759,419 |
Canada |  |  | 69,743 |  |  | 69,947 |  |  | 66,405 |
Latin America |  |  | 34,086 |  |  | 26,893 |  |  | 22,901 |
|  |  | 952,757 |  |  | 899,185 |  |  | 848,725 |
Europe, the Middle East and Africa |  |  |  |  |  |  |  |  |  |
Germany |  |  | 85,189 |  |  | 78,109 |  |  | 72,983 |
United Kingdom |  |  | 74,131 |  |  | 65,027 |  |  | 64,412 |
France |  |  | 53,322 |  |  | 49,093 |  |  | 45,927 |
Italy |  |  | 28,794 |  |  | 26,443 |  |  | 24,625 |
Spain |  |  | 21,566 |  |  | 20,194 |  |  | 19,776 |
Switzerland |  |  | 14,544 |  |  | 12,246 |  |  | 12,967 |
Other |  |  | 88,844 |  |  | 75,573 |  |  | 59,948 |
|  |  | 366,390 |  |  | 326,685 |  |  | 300,638 |
Asia Pacific Region |  |  |  |  |  |  |  |  |  |
Australia |  |  | 58,448 |  |  | 53,063 |  |  | 50,658 |
Japan |  |  | 44,132 |  |  | 44,869 |  |  | 49,204 |
China |  |  | 34,674 |  |  | 29,044 |  |  | 24,628 |
Other |  |  | 29,406 |  |  | 24,212 |  |  | 19,485 |
|  |  | 166,660 |  |  | 151,188 |  |  | 143,975 |
Total |  | $ | 1,485,807 |  | $ | 1,377,058 |  | $ | 1,293,338 |
Net long-lived assets, consisting of net property and equipment, are subject to geographic risks because they are generally difficult to move and to effectively utilize in another geographic area in a reasonable time period and because they are relatively illiquid. Net long-lived assets by principal geographic areas were as follows (in thousands):
|  |  |  |  | December 31, |  | December 31, |
|  |  |  |  |  | 2014 |  |  | 2013 |
Americas |  |  |  |  |  |  |  |  |  |
United States |  |  |  |  | $ | 262,475 |  | $ | 245,511 |
Brazil |  |  |  |  |  | 3,206 |  |  | 869 |
Canada |  |  |  |  |  | 2,270 |  |  | 2,114 |
|  |  |  |  |  | 267,951 |  |  | 248,494 |
Europe, the Middle East and Africa |  |  |  |  |  |  |  |  |  |
United Kingdom |  |  |  |  |  | 14,366 |  |  | 12,959 |
Germany |  |  |  |  |  | 4,836 |  |  | 5,733 |
France |  |  |  |  |  | 3,172 |  |  | 3,127 |
Netherlands |  |  |  |  |  | 3,456 |  |  | 2,956 |
Switzerland |  |  |  |  |  | 2,631 |  |  | 3,076 |
Other |  |  |  |  |  | 1,674 |  |  | 1,190 |
|  |  |  |  |  | 30,135 |  |  | 29,041 |
Asia Pacific Region |  |  |  |  |  |  |  |  |  |
Japan |  |  |  |  |  | 2,204 |  |  | 690 |
Australia |  |  |  |  |  | 1,789 |  |  | 1,801 |
Other |  |  |  |  |  | 1,508 |  |  | 1,188 |
|  |  |  |  |  | 5,501 |  |  | 3,679 |
Total |  |  |  |  | $ | 303,587 |  | $ | 281,214 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599 + Details
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