Business Segment Information

3 Months Ended

Jun. 30, 2013

Business Segment Information

Business Segment Information

10. Business Segment Information

We operate in three reportable segments: Roadway Sensors, Transportation Systems and iPerform.

The Roadway Sensors segment includes, among other products, our Vantage, VersiCam, Pico, Vantage Vector, SmartCycle, SmartScan and Abacus vehicle detection systems for traffic intersection control, incident detection and certain highway traffic data collection applications.

The Transportation Systems segment includes transportation engineering and consulting services and the development of transportation management and traveler information systems for the ITS industry. During Fiscal 2012 and Fiscal 2013, this segment included the operations of MET, which specializes in 511 advanced traveler information systems and offers predictive weather and Maintenance Decision Support System (“MDSS”) management tools that allow users to create solutions to meet roadway maintenance decision needs. As of April 1, 2013, the predictive weather and MDSS services were reassigned to the iPerform segment to better align our predictive weather and traffic capabilities, resources and initiatives. Prior year segment information presented in the table below has been re-classified to reflect this change.

The iPerform segment includes our performance measurement and information management solutions, including all the operations of BTS, which specializes in transportation performance measurement, as well as the predictive weather and MDSS services reassigned from the Transportation Systems segment on April 1, 2013. During Fiscal 2012, we began the development of IterisPeMS.  IterisPeMS is a state-of-the-art, information management software suite that utilizes a wide range of data resources and analytical techniques to determine current and future traffic patterns, permitting the effective performance analysis and management of traffic infrastructure resources. This information can then be analyzed by traffic professionals to measure how a transportation network is performing and to identify potential areas of improvement. IterisPeMS is also capable of providing users with predictive traffic analytics and easy-to-use visualization and animation features based on historical traffic conditions.

The accounting policies of our reportable segments are the same as those described in the summary of significant accounting policies (Note 1). Certain corporate expenses, including interest and amortization of intangible assets, are not allocated to the segments. The reportable segments are each managed separately because they manufacture and distribute distinct products or provide services with different processes. All reported segment revenues are derived from external customers.

The following table sets forth selected unaudited consolidated financial information for our reportable segments for the three months ended June 30, 2013 and 2012:

	Roadway Sensors		Transportation Systems		iPerform			Total
	(In thousands)
Three Months Ended June 30, 2013
Total revenues	$	7,529	$	8,258	$	1,243		$	17,030
Segment operating income (loss)	1,214		1,286		(246		)	2,254
Three Months Ended June 30, 2012
Total revenues	$	7,184	$	7,849	$	1,271		$	16,304
Segment operating income (loss)	1,392		856		(51		)	2,197

The following table reconciles total segment income to unaudited consolidated income from continuing operations before income taxes:

	Three Months Ended
	June 30,
	2013			2012
	(In thousands)
Segment operating income:
Total income from reportable segments	$	2,254		$	2,197
Unallocated amounts:
Corporate and other expenses	(1,417		)	(1,467		)
Amortization of intangible assets	(161		)	(161		)
Change in fair value of contingent consideration	(7		)	334
Other (expense) income, net	(3		)	5
Interest expense, net	(4		)	(5		)
Income from continuing operations before income taxes	$	662		$	903