Segment Information

6 Months Ended

Jun. 30, 2014

Segment Information

Segment Information

(7) Segment Information

        As a result of the restructuring of our operations late in 2013 and early in 2014, we evaluated changes to our internal financial reporting to better align our internal reporting to how we will manage our business going forward. This evaluation resulted in changes to our reportable segments effective January 1, 2014 and, as a result, we have restated previously reported segment information. As a result of the changes to our reportable segments, the former North American Business segment has been separated into two unique reportable segments, which we refer to as (1) North American Records and Information Management Business segment and (2) North American Data Management Business segment. In addition, the Emerging Businesses segment, which was previously reported as a component of the former North American Business segment, is now reported as a component of the Corporate and Other segment.

        Our reportable operating segments and Corporate and Other are described as follows:

• •

  North American Records and Information Management Business—storage and information management services throughout the United States and Canada, including the storage of paper documents, as well as other media such as microfilm and microfiche, master audio and videotapes, film, X-rays and blueprints, including healthcare information services, vital records services, service and courier operations, and the collection, handling and disposal of sensitive documents for corporate customers ("Records Management"); information destruction services ("Destruction"); DMS; Fulfillment Services; and Intellectual Property Management.

  •

  North American Data Management Business—the storage and rotation of backup computer media as part of corporate disaster recovery plans throughout the United States and Canada, including service and courier operations ("Data Protection & Recovery"); server and computer backup services; digital content repository systems to house, distribute, and archive key media assets; and storage, safeguarding and electronic or physical delivery of physical media of all types, primarily for entertainment and media industry clients.

  •

  International Business—storage and information management services throughout Europe, Latin America and Asia Pacific, including Records Management, Data Protection & Recovery, Destruction and DMS. Our European operations provide Records Management, Data Protection & Recovery and DMS throughout Europe, and Destruction services are primarily provided in the United Kingdom and Ireland. Our Latin America operations provide Records Management, Data Protection & Recovery, Destruction and DMS throughout Argentina, Brazil, Chile, Colombia, Mexico and Peru. Our Asia Pacific operations provide Records Management, Data Protection & Recovery, Destruction and DMS throughout Australia, with Records Management and Data Protection & Recovery services also provided in certain cities in India, Singapore, Hong Kong-SAR and China.

  •

  Corporate and Other—consists of our data center business in the United States, the primary product offering of our Emerging Businesses segment, as well as costs related to executive and staff functions, including finance, human resources and information technology, which benefit the enterprise as a whole. These costs are primarily related to the general management of these functions on a corporate level and the design and development of programs, policies and procedures that are then implemented in the individual segments, with each segment bearing its own cost of implementation. Corporate and Other also includes stock-based employee compensation expense associated with all Employee Stock-Based Awards.

        An analysis of our business segment information and reconciliation to the accompanying Consolidated Financial Statements is as follows:

	North American Records and Information Management Business			North American Data Management Business			International Business		Corporate and Other			Total Consolidated
Three Months Ended June 30, 2013
Total Revenues	$	446,015		$	99,480		$	205,703	$	3,198		$	754,396
Depreciation and Amortization		41,484			4,372			25,963		7,109			78,928
Depreciation		38,240			4,175			20,328		7,076			69,819
Amortization		3,244			197			5,635		33			9,109
Adjusted OIBDA		169,391			60,081			52,909		(50,036	)		232,345
Expenditures for Segment Assets		51,266			3,875			48,292		15,880			119,313
Capital Expenditures		24,928			3,751			18,263		15,880			62,822
Cash Paid for Acquisitions, Net of Cash Acquired		23,412			—			29,454		—			52,866
Additions to Customer Relationship and Acquisition Costs		2,926			124			575		—			3,625
Three Months Ended June 30, 2014
Total Revenues		452,271			97,551			233,590		3,480			786,892
Depreciation and Amortization		42,807			4,938			31,799		9,397			88,941
Depreciation		38,144			4,876			24,031		9,353			76,404
Amortization		4,663			62			7,768		44			12,537
Adjusted OIBDA		173,327			59,020			55,704		(46,202	)		241,849
Expenditures for Segment Assets		41,448			4,813			49,876		9,389			105,526
Capital Expenditures		34,678			4,702			32,120		9,389			80,889
Cash Paid for Acquisitions, Net of Cash Acquired		(161	)		(40	)		15,786		—			15,585
Additions to Customer Relationship and Acquisition Costs		6,931			151			1,970		—			9,052
Six Months Ended June 30, 2013
Total Revenues		885,705			198,307			410,256		6,834			1,501,102
Depreciation and Amortization		82,337			8,714			52,969		15,109			159,129
Depreciation		75,799			8,312			40,760		15,043			139,914
Amortization		6,538			402			12,209		66			19,215
Adjusted OIBDA		331,894			119,498			100,807		(92,703	)		459,496
Total Assets(1)		3,538,248			632,681			1,792,933		370,957			6,334,819
Expenditures for Segment Assets		91,188			8,060			81,320		38,725			219,293
Capital Expenditures		61,858			7,877			49,780		38,725			158,240
Cash Paid for Acquisitions, Net of Cash Acquired		23,338			—			29,454		—			52,792
Additions to Customer Relationship and Acquisition Costs		5,992			183			2,086		—			8,261
Six Months Ended June 30, 2014
Total Revenues		898,403			194,275			458,020		6,320			1,557,018
Depreciation and Amortization		88,313			9,968			60,558		16,535			175,374
Depreciation		78,965			9,841			45,820		16,491			151,117
Amortization		9,348			127			14,738		44			24,257
Adjusted OIBDA		340,736			113,288			114,467		(98,118	)		470,373
Total Assets(1)		3,678,690			642,392			2,154,819		259,223			6,735,124
Expenditures for Segment Assets		90,714			10,320			114,817		36,470			252,321
Capital Expenditures		77,239			10,209			64,827		36,470			188,745
Cash Paid for Acquisitions, Net of Cash Acquired		(1,077	)		(40	)		47,483		—			46,366
Additions to Customer Relationship and Acquisition Costs		14,552			151			2,507		—			17,210

(1)

Excludes all intercompany receivables or payables and investment in subsidiary balances.

        The accounting policies of the reportable segments are the same as those described in Note 2. Adjusted OIBDA for each segment is defined as operating income before depreciation, amortization, intangible impairments, (gain) loss on disposal/write-down of property, plant and equipment, net and REIT Costs (defined below) directly attributable to the segment. Internally, we use Adjusted OIBDA as the basis for evaluating the performance of, and allocating resources to, our operating segments.

        A reconciliation of Adjusted OIBDA to income from continuing operations before provision (benefit) for income taxes on a consolidated basis is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2014			2013			2014
Adjusted OIBDA	$	232,345		$	241,849		$	459,496		$	470,373
Less: Depreciation and Amortization		78,928			88,941			159,129			175,374
(Gain) Loss on Disposal/Write-down of Property, Plant and Equipment, Net		(1,663	)		(107	)		(2,202	)		(8,414	)
REIT Costs(1)		23,536			5,725			48,508			14,048
Interest Expense, Net		62,989			62,201			126,171			124,513
Other Expense (Income), Net		15,275			(4,838	)		18,014			479
Income from Continuing Operations before Provision (Benefit) for Income Taxes	$	53,280		$	89,927		$	109,876		$	164,373

(1)

Includes costs associated with our 2011 proxy contest, the previous work of the former Strategic Review Special Committee of the board of directors and costs associated with our conversion to a REIT, excluding REIT compliance costs beginning January 1, 2014 which we expect to recur in future periods ("REIT Costs").