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Operating Segments
 6 Months Ended
Dec. 31, 2015
Segment Reporting [Abstract]  
Operating Segments
Segments

Historically, the Company had one operating segment. However, in connection with the Perk Agreement entered into on December 13, 2015 to sell the Viggle rewards business (discontinued operations), which represents a significant portion of the Company's assets and revenues (see Note 2, Lines of Business), the Company's remaining operations were divided into 3 operating segments, as described below. These segments offer different products and services and are currently presented separately in internal management reports, and managed separately.

•
Wetpaint: a media channel reporting original news stories and publishing information content covering top television shows, music, celebrities, entertainment news and fashion.
•
Choose Digital: a business-to-business platform for delivering digital content.
•
DDGG: a business-to-business operator of daily fantasy sports.

The accounting policies followed by the segments are described in Note 3, Summary of Significant Accounting Policies. The operating segments of the Company include the assets, liabilities, revenues and expenses that management has determined are specifically or primarily identifiable to each segment, as well as direct and indirect costs that are attributable to the operations of each segment. These direct costs are the operational costs that are administered by the Company following the shared services concept. Indirect costs are the costs of support functions that are provided on a centralized or geographic basis by the Company, which include, but are not limited to, finance, human resources, benefits administration, procurement support, information technology, legal, corporate strategy, corporate governance and other professional services and general commercial support functions.
Central support costs have been allocated to each operating segment based on a specific identification basis or, when specific identification is not practicable, a proportional cost allocation method (primarily based on net sales or direct payroll costs), depending on the nature of the services received. Management considers that such allocations have been made on a reasonable basis, but may not necessarily be indicative of the costs that would have been incurred if the operating segments had been operated on a stand-alone basis for the periods presented.
Information regarding the results of each reportable segment is included below. Performance is measured based on unit profit after tax, as included in the internal management reports that are reviewed by the Chief Operating Decision Maker. Business unit profit is used to measure performance as management believes that such information is the most relevant in evaluating the success of each business and determining the going forward strategy for the Company as a whole.
Information about reportable segments:


For The Three Months Ended December 31,

Wetpaint
Choose Digital
DDGG
Total
In thousands of U.S. dollars
2015
2014
2015
2014
2015
2014
2015
2014
External revenues
530

1,102

217

237

243

—

990

1,339

Inter-segment revenues (1)
—

—

668

79

—

—

668

79










Net loss, net of income taxes (2)
(28,478
)
(2,470
)
(3,645
)
(1,500
)
(1,533
)
—

(33,656
)
(3,970
)



















For The Six Months Ended December 31,

Wetpaint
Choose Digital
DDGG
Total
In thousands of U.S. dollars
2015
2014
2015
2014
2015
2014
2015
2014
External revenues
1,046

2,081

415

454

326

—

1,787

2,535

Inter-segment revenues (1)
—

—

1,219

98

—

—

1,219

98










Net loss, net of income taxes (2)
(30,338
)
(5,087
)
(4,120
)
(2,917
)
(1,507
)
—

(35,965
)
(8,004
)









Notes:








(1) The Choose Digital business provides digital content to the Viggle business. These inter-segment revenues are presented at Choose Digital's cost and are eliminated in the consolidated statements of operations.
(2) The net loss figures presented exclude certain corporate expenses detailed in the reconciliation to the consolidated net loss below.
(3) Assets and liabilities are not presented as they are reviewed at the consolidated level by management and not accounted for by segment.



















Reconciliation of net loss for reportable segments, net of income taxes to consolidated net loss from continuing operations, net of income taxes:
In thousands of U.S. dollars
Three Months Ended December 31, 2015
Three Months Ended December 31, 2014
Six Months Ended December 31, 2015
Six Months Ended December 31, 2014
Net loss for reportable segments, net of income taxes
(33,656
)
(3,970
)
(35,965
)
(8,004
)
Other net loss
(88
)
(297
)
(297
)
(453
)

(33,744
)
(4,267
)
(36,262
)
(8,457
)





Stock compensation related to corporate financing activities (1)
(4,250
)
(7,306
)
(8,500
)
(11,539
)
Corporate expenses allocated to discontinued operations (2)
(650
)
(918
)
(1,791
)
(2,127
)
Interest expense (3)
(926
)
(353
)
(1,783
)
(480
)
Consolidated net loss from continuing operations, net of income taxes
(39,570
)
(12,844
)
(48,336
)
(22,603
)





Notes:




(1) Stock compensation expense related to RSUs, options and warrants issues in connection with financing activities. Expenses related to financing activities are considered to be corporate expenses and are not allocated to reportable segments.
(2) Certain corporate expenses were allocated to the Viggle segment, however such expenses are not classified as discontinued operations because they are fixed and are not affected by the sales transaction.
(3) Interest expense related to corporate debt instruments is not allocated to reportable segments.

The Company continues to support the cash needs and operations of DDGG. As of December 31, 2015 the Company has transferred $474 to the DDGG subsidiary. This transfer has been accounted for as an interest free loan.