Segment information

As a result of our business combination with the Sagicor Parties, we evaluated and modified the presentation of our reportable segments to reflect the management of our resorts after the incorporation of the Sagicor Assets. We divided our Caribbean Basin segment into separate Dominican Republic and Jamaica segments, which caused us to change from three to four reportable segments. The results for all comparative prior periods have been reclassified to conform to the current period presentation.

We consider each one of our resorts to be an operating segment, none of which meets the threshold for a reportable segment. We also allocate resources and assess operating performance based on individual resorts. Our operating segments meet the aggregation criteria and thus, we present four separate reportable segments by geography: (i) Yucatán Peninsula, (ii) Pacific Coast, (iii) Dominican Republic and (iv) Jamaica. For the three and nine months ended September 30, 2018 and 2017, we have excluded the immaterial amounts of management fees, cost reimbursements and other from our segment reporting.

Our operating segments are components of the business which are managed discretely and for which discrete financial information is reviewed regularly by our Chief Executive Officer, Chief Financial Officer and Chief Operating Officer, all of whom represent our chief operating decision maker (“CODM”). Financial information for each reportable segment is reviewed by the CODM to assess performance and make decisions regarding the allocation of resources. We did not provide a reconciliation of reportable segments' assets to our consolidated assets as this information is not regularly reviewed by the CODM to assess performance and make decisions regarding the allocation of resources.

The performance of our operating segments is evaluated primarily on adjusted earnings before interest expense, income tax provision, and depreciation and amortization expense (“Adjusted EBITDA”), which should not be considered an alternative to net (loss) income or other measures of financial performance or liquidity derived in accordance with U.S. GAAP. We define Adjusted EBITDA as net (loss) income, determined in accordance with U.S. GAAP, for the period presented, before interest expense, income tax provision, and depreciation and amortization expense, further adjusted to exclude the following items: (a) other (expense) income, net; (b) share-based compensation; (c) loss on extinguishment of debt; (d) transaction expenses; (e) severance expense; (f) other tax expense; (g) Jamaica delayed opening accrual reversal; (h) pre-opening expenses; (i) property damage insurance proceeds; and (j) repairs from hurricanes and tropical storms.

There are limitations to using financial measures such as Adjusted EBITDA. For example, other companies in our industry may define Adjusted EBITDA differently than we do. As a result, it may be difficult to use Adjusted EBITDA or similarly named financial measures that other companies publish to compare the performance of those companies to our performance. Because of these limitations, Adjusted EBITDA should not be considered as a measure of the income or loss generated by our business or discretionary cash available for investment in our business and investors should carefully consider our U.S. GAAP results presented in our Condensed Consolidated Financial Statements.

The following tables present segment net revenue, a reconciliation to gross revenue and segment Adjusted EBITDA and a reconciliation to net (loss) income ($ in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Revenue:
Yucatàn Peninsula	$	57,087	$	59,630	$	200,025	$	209,305
Pacific Coast	16,211		15,872		65,081		67,377
Dominican Republic	27,580		26,139		99,493		96,935
Jamaica	36,651		13,144		87,141		49,091
Segment net revenue ⁽¹⁾	137,529		114,785		451,740		422,708
Other	—		10		343		12
Management fees	152		—		503		—
Cost reimbursements	227		—		349		—
Compulsory tips	4,904		3,547		12,296		10,287
Total gross revenue	$	142,812	$	118,342	$	465,231	$	433,007

________

⁽¹⁾ Segment net revenue represents total gross revenue less compulsory tips paid to employees, cost reimbursements and other miscellaneous revenue not derived from segment operations.



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Adjusted EBITDA:
Yucatàn Peninsula	$	18,484		$	20,824		$	83,814		$	93,070
Pacific Coast	2,869			3,758			23,327			27,242
Dominican Republic	7,161			5,460			35,174			31,263
Jamaica	6,688			1,821			25,421			11,590
Segment Adjusted EBITDA	35,202			31,863			167,736			163,165
Other corporate - unallocated	(9,322		)	(7,544		)	(26,331		)	(23,354		)
Management fees	152			—			503			—
Total consolidated Adjusted EBITDA	26,032			24,319			141,908			139,811
Less:
Other expense (income), net	390			(1,939		)	1,836			(626		)
Share-based compensation	1,182			1,843			5,072			2,803
Loss on extinguishment of debt	—			—			—			12,526
Transaction expenses	1,447			1,893			7,678			11,193
Severance expense	333			—			333			442
Other tax expense	399			175			1,257			598
Jamaica delayed opening accrual reversal	—			(41		)	(342		)	(152		)
Pre-opening expenses	87			—			87			—
Property damage insurance proceeds	(203		)	—			(203		)	—
Repairs from hurricanes and tropical storms	—			765			—			765
Add:
Non-service cost components of net periodic pension cost (benefit)	335			(157		)	492			565
Interest expense	(7,637		)	(13,099		)	(35,151		)	(41,187		)
Depreciation and amortization	(20,138		)	(13,808		)	(51,709		)	(40,093		)
Net (loss) income before tax	(5,043		)	(5,441		)	39,822			31,547
Income tax provision	(379		)	(226		)	(6,606		)	(20,105		)
Net (loss) income	$	(5,422	)	$	(5,667	)	$	33,216		$	11,442