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Operating Segment and Enterprise Wide Reporting
 12 Months Ended
Dec. 31, 2012
Operating Segment and Enterprise Wide Reporting [Abstract]  
Operating Segment and Enterprise Wide Reporting

(11)    Operating Segment and Enterprise Wide Reporting

Forrester is organized into two client groups with each client group responsible for writing relevant research for the roles within the client organization on a worldwide basis. The two client groups, which are considered operating segments, are: Business Technology (“BT”) and Marketing and Strategy (“M&S”). In addition, the Company’s Events segment supports both client groups. Each client group generates revenues through sales of research, advisory and other service offerings targeted at specific roles within their targeted clients. Each client group consists of research personnel focused primarily on issues relevant to particular roles and to the day-to-day responsibilities of persons within the roles. Amounts included in the Events segment relate to the operations of the events production department. Revenue reported in the Events segment consists primarily of sponsorships and event tickets to Forrester events.

Forrester evaluates reportable segment performance and allocates resources based on direct margin. Direct margin, as presented below, is defined as operating income excluding sales expenses, certain marketing and fulfillment expenses, stock-based compensation expense, general and administrative expenses, depreciation expense, amortization of intangible assets and reorganization costs. In the second quarter of 2012 the Company modified its management structure by consolidating its former Technology Industry client group segment into its two remaining client groups: BT and M&S. In addition, in the first quarter of 2012, the Company modified its calculation of segment direct margin to exclude certain marketing costs and Springboard Research integration costs and to include certain business development costs. Accordingly, the 2011 and 2010 amounts have been reclassified to conform to the current presentation. The accounting policies used by the segments are the same as those used in the consolidated financial statements.

Forrester does not identify or allocate assets, including capital expenditures, by operating segment. Accordingly, assets are not being reported by segment because the information is not available by segment and is not reviewed in the evaluation of performance or making decisions in the allocation of resources.

The following tables present information about reportable segments (in thousands).

 

                                 
    BT     M&S     Events     Consolidated  

Year ended December 31, 2012

                                

Revenue

   $ 159,216     $ 120,885     $ 12,829     $ 292,930  

Direct margin

     105,288       82,225       3,941       191,454  

Selling, marketing, administrative and other expenses

                             (156,929 ) 

Amortization of intangible assets

                             (2,445 ) 

Reorganization costs

                             (1,421 ) 

Other income and gains/losses on investments

                             851  
                           

 

 

  

Income before income taxes

                           $ 31,510  
                           

 

 

  
         
    BT     M&S     Events     Consolidated  

Year ended December 31, 2011

                                

Revenue

   $ 154,777     $ 115,666     $ 13,173     $ 283,616  

Direct margin

     103,616       77,510       5,765       186,891  

Selling, marketing, administrative and other expenses

                             (146,957 ) 

Amortization of intangible assets

                             (2,562 ) 

Reorganization costs

                             (375 ) 

Other income and gains/losses on investments

                             1,648  
                           

 

 

  

Income before income taxes

                           $ 38,645  
                           

 

 

  

Year ended December 31, 2010

                                

Revenue

   $ 143,992     $ 95,534     $ 11,200     $ 250,726  

Direct margin

     97,699       63,002       4,753       165,454  

Selling, marketing, administrative and other expenses

                             (131,084 ) 

Amortization of intangible assets

                             (3,620 ) 

Other income and gains/losses on investments

                             3,550  
                           

 

 

  

Income before income taxes

                           $ 34,300  
                           

 

 

  

Net long-lived tangible assets by location as of December 31, 2012 and 2011 are as follows (in thousands):

 

                 
    2012     2011  

United States

   $ 41,928     $ 46,928  

United Kingdom

     2,626       2,997  

Europe (excluding United Kingdom)

     313       521  

Other

     1,263       2  
   

 

 

    

 

 

  
    $ 46,130     $ 50,448  
   

 

 

    

 

 

  

Net revenues by geographic destination and as a percentage of total revenues for the years ended December 31, 2012, 2011, and 2010 are as follows (in thousands):

 

                         
    2012     2011     2010  

United States

   $ 211,110     $ 198,456     $ 180,065  

Europe (excluding United Kingdom)

     33,146       37,205       31,188  

United Kingdom

     16,555       17,870       15,285  

Canada

     16,742       16,056       13,724  

Other

     15,377       14,029       10,464  
   

 

 

    

 

 

    

 

 

  
    $ 292,930     $ 283,616     $ 250,726  
   

 

 

    

 

 

    

 

 

  

 

                         
    2012     2011     2010  

United States

     72 %      70 %      72 % 

Europe (excluding United Kingdom)

     11 %      13 %      12 % 

United Kingdom

     6 %      6 %      6 % 

Canada

     6 %      6 %      6 % 

Other

     5 %      5 %      4 % 
   

 

 

    

 

 

    

 

 

  
      100 %      100 %      100 %