SEGMENT INFORMATION

12 Months Ended

Jun. 30, 2018

NOTE 16: SEGMENT INFORMATION

Beginning in the second quarter of fiscal year 2018, DeVry University operations are classified as discontinued operations. In addition, beginning in the fourth quarter of fiscal year 2018, Carrington operations are classified as discontinued operations. See “Note 2: Discontinued Operations and Assets Held for Sale” for further information. Therefore, segment information presented excludes the results of DeVry University and Carrington, which were previously classified within the U.S. Traditional Postsecondary segment and are presented as discontinued operations in the Consolidated Financial Statements. Discontinued operations assets are included in the table below to reconcile to Total Consolidated Assets presented on the Consolidated Balance Sheets. In addition, certain expenses previously allocated to DeVry University and Carrington within the U.S. Traditional Postsecondary segment have been reclassified to the Home Office and Other segment based on discontinued operating reporting guidance regarding allocation of corporate overhead.

Adtalem’s principal business is the provision of educational services. Adtalem presents three reporting segments: “Medical and Healthcare,” which includes the operations of Chamberlain and the medical and veterinary schools (which include AUC, RUSM and RUSVM); “Professional Education,” which includes the operations of Becker, ACAMS and EduPristine; and “Technology and Business,” which includes the operations of Adtalem Brazil.

These segments are consistent with the method by which the Chief Operating Decision Maker (Adtalem’s President and Chief Executive Officer) evaluates performance and allocates resources. Performance evaluations are based, in part, on each segment’s operating income. Intersegment sales are accounted for at amounts comparable to sales to nonaffiliated customers and are eliminated in consolidation. “Home Office and Other” includes activity not allocated to a reporting segment and is included to reconcile segment results to the Consolidated Financial Statements.

Segments may have allocated depreciation expense related to depreciable assets reported as an asset in a different segment.

The accounting policies of the segments are the same as those described in “Note 4: Summary of Significant Accounting Policies.”

Summary financial information by reporting segment is as follows (in thousands):

	Year Ended June 30,
	2018			2017			2016
Revenue:
Medical and Healthcare	$	815,674		$	802,462		$	783,655
Professional Education		147,195			131,769			102,921
Technology and Business		270,934			276,341			196,097
Home Office and Other		(2,592	)		(2,663	)		(2,598	)
Total Consolidated Revenue	$	1,231,211		$	1,207,909		$	1,080,075
Operating Income (Loss) from Continuing Operations:
Medical and Healthcare	$	189,672		$	187,138		$	178,484
Professional Education		27,695			19,866			28,043
Technology and Business		29,431			36,204			13,580
Home Office and Other (1)		(39,322	)		(107,710	)		(64,017	)
Total Consolidated Operating Income from Continuing Operations	$	207,476		$	135,498		$	156,090
Segment Assets:
Medical and Healthcare	$	988,920		$	905,741		$	834,975
Professional Education		456,589			451,261			91,741
Technology and Business		547,110			606,563			583,020
Home Office and Other		291,760			186,217			386,617
Discontinued Operations		60,582			165,236			200,643
Total Consolidated Assets	$	2,344,961		$	2,315,018		$	2,096,996
Additions to Long-Lived Assets:
Medical and Healthcare	$	34,099		$	15,774		$	25,645
Professional Education		15,063			364,275			1,120
Technology and Business		25,998			19,222			206,955
Home Office and Other		10,675			6,477			10,806
Total Consolidated Additions to Long-Lived Assets	$	85,835		$	405,748		$	244,526
Reconciliation to Consolidated Financial Statements
Capital Expenditures	$	66,530		$	42,508		$	51,455
Increase in Capital Assets from Acquisitions		381			4,913			13,778
Increase in Intangible Assets and Goodwill		18,924			358,327			179,293
Total Increase in Consolidated Long-Lived Assets	$	85,835		$	405,748		$	244,526
Depreciation Expense (2):
Medical and Healthcare	$	29,731		$	31,938		$	33,795
Professional Education		1,999			1,869			1,550
Technology and Business		10,282			10,117			5,444
Home Office and Other		1,274			1,881			2,530
Total Consolidated Depreciation Expense	$	43,286		$	45,805		$	43,319
Intangible Asset Amortization Expense:
Professional Education	$	6,501		$	7,482		$	563
Technology and Business		3,037			3,687			4,629
Total Consolidated Amortization Expense	$	9,538		$	11,169		$	5,192

(1) Home Office and Other Operating Loss includes $52.2 million in charges in the year ended June 30, 2017 for regulatory settlements as described in "Note 3: Regulatory Settlements."

(2) Depreciation expense for each reporting segment has been modified to current presentation to include the Home Office and Other depreciation which is allocated to each reporting segment.

Adtalem conducts its educational operations in the U.S., Dominica, St. Kitts, St. Maarten, Brazil, Canada, Europe, the Middle East, India, China and the Pacific Rim. Other international revenue, which is derived principally from Europe and the Pacific Rim, was less than 5% of total revenue for each of the years ended June 30, 2018, 2017 and 2016. Revenue and long-lived assets by geographic area are as follows (in thousands):

	Year Ended June 30,
	2018		2017		2016
Revenue from Unaffiliated Customers:
Domestic Operations	$	610,967	$	585,865	$	531,025
International Operations:
Dominica, St. Kitts and St. Maarten		342,831		340,861		346,235
Brazil		270,934		276,341		196,097
Other		6,479		4,842		6,718
Total International		620,244		622,044		549,050
Total Consolidated Revenue	$	1,231,211	$	1,207,909	$	1,080,075
Long-Lived Assets:
Domestic Operations	$	148,724	$	164,324	$	191,966
International Operations:
Dominica, St. Kitts and St. Maarten		182,701		190,843		190,513
Brazil		94,467		104,497		106,878
Other		2,021		3,378		3,388
Total International		279,189		298,718		300,779
Total Consolidated Long-Lived Assets	$	427,913	$	463,042	$	492,745

No one customer accounted for more than 10% of Adtalem's consolidated revenue.