XML 13 R17.htm IDEA: XBRL DOCUMENT
v2.4.0.8

SEGMENT REPORTING | 9 Months Ended
--- | ---
Sep. 30, 2013
Segment Reporting [Abstract] |
SEGMENT REPORTING | SEGMENT REPORTING The Company manages its business geographically in two operating segments, with the primary areas of measurement and decision-making being the U.S. and International, which includes the U.K. and France. The Company’s subscription-based information services consist primarily of CoStar Suite™ and FOCUS™ services. CoStar Suite is sold as a platform of service offerings consisting of CoStar Property Professional®, CoStar COMPS Professional® and CoStar Tenant® and through the Company's mobile application, CoStarGo®. CoStar Suite is the Company's primary service offering in the U.S. operating segment. FOCUS is the Company's primary service offering in the International operating segment. Additionally, the Company introduced CoStar Suite in the U.K. in the fourth quarter of 2012. CoStar's and its subsidiaries' subscription-based services consist primarily of similar services offered over the Internet to commercial real estate industry and related professionals. Management relies on an internal management reporting process that provides revenue and operating segment EBITDA, which is the Company's net income before interest, income taxes, depreciation and amortization. Management believes that operating segment EBITDA is an appropriate measure for evaluating the operational performance of the Company's operating segments. EBITDA is used by management to internally measure operating and management performance and to evaluate the performance of the business. However, this measure should be considered in addition to, not as a substitute for or superior to, income from operations or other measures of financial performance prepared in accordance with GAAP.
11. | SEGMENT REPORTING — (CONTINUED)
Summarized information by operating segment consists of the following (in thousands):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2013 |  | 2012 |  | 2013 |  | 2012
Revenues |  |  |  |  |  |  |
United States | $ | 107,230 |  |  | $ | 91,153 |  |  | $ | 310,762 |  |  | $ | 235,606 |
International |  |  |  |  |  |  |  |  |  |  |
External customers | 5,071 |  |  | 4,848 |  |  | 14,571 |  |  | 14,247 |
Intersegment revenue | 131 |  |  | 388 |  |  | 277 |  |  | 1,154 |
Total international revenue | 5,202 |  |  | 5,236 |  |  | 14,848 |  |  | 15,401 |
Intersegment eliminations | (131 | ) |  | (388 | ) |  | (277 | ) |  | (1,154 | )
Total revenues | $ | 112,301 |  |  | $ | 96,001 |  |  | $ | 325,333 |  |  | $ | 249,853 |
EBITDA |  |  |  |  |  |  |  |  |  |  |
United States | $ | 30,855 |  |  | $ | 22,688 |  |  | $ | 66,609 |  |  | $ | 46,302 |
International | (1,063 | ) |  | (3,047 | ) |  | (3,917 | ) |  | (6,568 | )
Total EBITDA | $ | 29,792 |  |  | $ | 19,641 |  |  | $ | 62,692 |  |  | $ | 39,734 |
Reconciliation of EBITDA to net income |  |  |  |  |  |  |
EBITDA | $ | 29,792 |  |  | $ | 19,641 |  |  | $ | 62,692 |  |  | $ | 39,734 |
Purchase amortization in cost of revenues | (2,954 | ) |  | (3,027 | ) |  | (9,007 | ) |  | (5,607 | )
Purchase amortization in operating expenses | (3,680 | ) |  | (4,824 | ) |  | (11,699 | ) |  | (9,038 | )
Depreciation and other amortization | (3,388 | ) |  | (2,844 | ) |  | (9,531 | ) |  | (7,554 | )
Interest income | 52 |  |  | 59 |  |  | 239 |  |  | 440 |
Interest expense | (1,736 | ) |  | (1,822 | ) |  | (5,249 | ) |  | (3,022 | )
Income tax expense, net | (7,034 | ) |  | (404 | ) |  | (10,510 | ) |  | (9,752 | )
Net income | $ | 11,052 |  |  | $ | 6,779 |  |  | $ | 16,935 |  |  | $ | 5,201 |
Intersegment revenue is attributable to services performed for the Company’s wholly owned subsidiary, Property and Portfolio Research, Inc. (“PPR”) by Property and Portfolio Research Ltd., a wholly owned subsidiary of PPR. Intersegment revenue is recorded at an amount the Company believes approximates fair value. U.S. EBITDA includes a corresponding cost for the services performed by Property and Portfolio Research Ltd. for PPR. U.S. EBITDA includes an allocation of approximately $300,000 and $0 for the three months ended September 30, 2013 and 2012, respectively. U.S. EBITDA includes an allocation of approximately $600,000 and $0 for the nine months ended September 30, 2013 and 2012, respectively. This allocation represents costs incurred for International employees involved in development activities of the Company's U.S. operating segment. International EBITDA includes a corporate allocation of approximately $100,000 and $2.3 million for the three months ended September 30, 2013 and 2012, respectively. International EBITDA includes a corporate allocation of approximately $300,000 and $4.5 million for the nine months ended September 30, 2013 and 2012, respectively. The corporate allocation represents costs incurred for U.S. employees involved in management and expansion activities of the Company's International operating segment.
11. | SEGMENT REPORTING — (CONTINUED)
Summarized information by operating segment consists of the following (in thousands):
| September 30, 2013 |  | December 31, 2012
Property and equipment, net |  |  |
United States | $ | 51,781 |  |  | $ | 42,480 |
International | 3,922 |  |  | 3,828 |
Total property and equipment, net | $ | 55,703 |  |  | $ | 46,308 |
Goodwill |  |  |  |  |
United States | $ | 692,639 |  |  | $ | 692,639 |
International | 25,400 |  |  | 25,439 |
Total goodwill | $ | 718,039 |  |  | $ | 718,078 |
Assets |  |  |  |  |
United States | $ | 1,285,779 |  |  | $ | 1,215,949 |
International | 41,963 |  |  | 40,933 |
Total operating segment assets | $ | 1,327,742 |  |  | $ | 1,256,882 |
Reconciliation of operating segment assets to total assets |  |  |  |  |
Total operating segment assets | $ | 1,327,742 |  |  | $ | 1,256,882 |
Investment in subsidiaries | (18,344 | ) |  | (18,344 | )
Intersegment receivables | (79,024 | ) |  | (73,399 | )
Total assets | $ | 1,230,374 |  |  | $ | 1,165,139 |
Liabilities |  |  |  |  |
United States | $ | 326,850 |  |  | $ | 335,855 |
International | 77,209 |  |  | 70,108 |
Total operating segment liabilities | $ | 404,059 |  |  | $ | 405,963 |
Reconciliation of operating segment liabilities to total liabilities |  |  |  |  |
Total operating segment liabilities | $ | 404,059 |  |  | $ | 405,963 |
Intersegment payables | (73,004 | ) |  | (67,167 | )
Total liabilities | $ | 331,055 |  |  | $ | 338,796 |

X
- Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 1 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599 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 10 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599 Reference 4: 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 5: 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 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
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration