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Business Segment Information
 12 Months Ended
Dec. 31, 2013
Business Segment Information
17. Business Segment Information

The Company is a contract research organization (“CRO”), providing outsourced development services on a global basis to the pharmaceutical, biotechnology and medical device industries. It specializes in the strategic development, management and analysis of programs that support all stages of the clinical development process - from compound selection to Phase I-IV clinical studies.  The Company has the expertise and capability to conduct clinical trials in most major therapeutic areas on a global basis and has the operational flexibility to provide development services on a stand-alone basis or as part of an integrated “full service” solution.  The Company has expanded predominately through internal growth, together with a number of strategic acquisitions to enhance its expertise and capabilities in certain areas of the clinical development process.  The Company also provides laboratory services through its central laboratory business, which includes the Company’s central laboratories located in Dublin, New York, India, Singapore and China.

The Company determines and presents operating segments based on the information that is internally provided to the Chief Executive Officer and Chief Financial Officer, who together are considered the Company’s chief operating decision maker, in accordance with FASB ASC 280-10 Disclosures about Segments of an Enterprises and Related Information. Historically, the Group organized, operated and assessed its business in two segments, the clinical research segment and the central laboratory segment.  In Q1 2013 the Group consolidated and reclassified the results of the former central laboratory segment into the clinical research segment as the central laboratory segment does not reach the thresholds of net revenue, income from operations and total assets as a requirement for being reported as a separate segment.  Management determined that its clinical research and central laboratory businesses operate in the same clinical research market, have a similar customer profile, are subject to the same regulatory environment, support the development of new clinical therapies and are so economically similar, reporting their results on an aggregated basis would be more useful to users of the Company’s financial statements.

The Company's areas of operation outside of Ireland include the United States, United Kingdom, France, Germany, Italy, Spain, The Netherlands, Sweden, Belgium, Turkey, Poland, Czech Republic, Lithuania, Latvia, Russia, Ukraine, Hungary, Israel, Romania, Canada, Mexico, Brazil, Colombia, Argentina, Chile, Peru, India, China, South Korea, Japan, Thailand, Taiwan, Singapore, The Philippines, Australia, New Zealand, and South Africa.

Segment information as at December 31, 2013 and December 31, 2012 and for the years ended December 31, 2013, December 31, 2012 and December 31, 2011 is as follows:

a)  The distribution of net revenue by geographical area was as follows:
 
     
Year ended
  
     
December
      
December
      
December
  
     
2013
      
2012
      
2011
  
     
(in thousands)
  
Ireland
   $ 272,683     $ 171,977     $ 88,869  
Rest of Europe
     333,543       338,537       348,492  
U.S.
     582,250       471,700       393,957  
Other
     147,582       132,792       114,411  
Total
   $ 1,336,058     $ 1,115,006     $ 945,729  

b) The distribution of income from operations, including restructuring and other items, by geographical area was as follows:
 
   
Year ended
  
   
December
    
December
    
December
  
   
2013
    
2012
    
2011
  
   
(in thousands)
  
Ireland
   $ 81,811     $ 9,659     $ (34,703 )
Rest of Europe
     2,831       29,240       32,175  
U.S.
     29,472       21,036       24,874  
Other
     7,053       8,082       7,097  
Total
   $ 121,167     $ 68,017     $ 29,443  

c) The distribution of income from operations, excluding restructuring and other items, by geographical area was as follows:

   
Year ended
  
   
December
    
December
    
December
  
   
2013
    
2012
    
2011
  
   
(in thousands)
  
Ireland
   $ 82,867     $ 11,733     $ (33,139 )
Rest of Europe
     6,269       29,786       35,175  
U.S.
     33,564       23,687       30,127  
Other
     7,500       8,447       7,097  
Total
   $ 130,200     $ 73,653     $ 39,260  

d) The distribution of property, plant and equipment, net, by geographical area was as follows:

   
December 31,
    
December 31,
  
   
2013
    
2012
  
   
(in thousands)
  
Ireland
   $ 103,868     $ 110,369  
Rest of Europe
     14,630       16,115  
U.S.
     33,947       32,400  
Other
     8,385       9,489  
Total
   $ 160,830     $ 168,373  

e) The distribution of depreciation and amortization by geographical area was as follows:

   
Year ended
  
   
December
    
December
    
December
  
   
2013
    
2012
    
2011
  
   
(in thousands)
  
Ireland
   $ 19,826     $ 17,885     $ 15,192  
Rest of Europe
     6,595       7,211       7,057  
U.S.
     16,233       13,865       12,427  
Other
     3,860       3,862       4,006  
Total
   $ 46,514     $ 42,823     $ 38,682  
 
f)    The distribution of total assets by geographical area was as follows:

   
December 31,
    
December 31,
  
   
2013
    
2012
  
   
(in thousands)
  
Ireland
   $ 581,568     $ 476,159  
Rest of Europe
     321,661       236,305  
U.S.
     486,232       437,756  
Other
     52,999       51,888  
Total
   $ 1,442,460     $ 1,202,108  

g) The distribution of capital expenditures by geographical area was as follows:

   
Year ended
  
   
December
    
December
    
December
  
   
2013
    
2012
    
2011
  
   
(in thousands)
  
Ireland
   $ 3,976     $ 12,406     $ 16,987  
Rest of Europe
     1,887       2,506       4,795  
U.S.
     20,842       13,389       10,222  
Other
     2,783       4,725       4,001  
Total
   $ 29,488     $ 33,026     $ 36,005  

h) The following table sets forth the clients which represented 10% or more of the Company's net revenue in each of the periods set out below.
 
   
Year ended
  
   
December
    
December
    
December
  
   
2013
    
2012
    
2011
  
                   
Client A
     26 %     18 %     *  
                         
Client B
     10 %     12 %     13 %
 
* Net revenue did not exceed 10%.

i) The distribution of interest income by geographical area was as follows:

   
Year ended
  
   
December
    
December
    
December
  
   
2013
    
2012
    
2011
  
   
(in thousands)
  
Ireland
   $ 355     $ 464     $ 762  
Rest of Europe
     501       661       364  
U.S.
     -       3       18  
Other
     130       23       50  
Total
   $ 986     $ 1,151     $ 1,194  
 
j) The distribution of the tax charge by geographical area was as follows:

   
Year ended
  
   
December
    
December
    
December
  
   
2013
    
2012
    
2011
  
   
(in thousands)
  
Ireland
   $ 11,073     $ 1,216     $ (3,475 )
Rest of Europe
     (7 )     3,298       657  
U.S.
     5,072       3,669       4,656  
Other
     1,915       3,618       4,277  
Total
   $ 18,053     $ 11,801     $ 6,115