Segment and Related Information

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

Segment and Related Information

Segment and Related Information

We provide integrated information management solutions and services for the public sector, with a focus on local governments.

We provide our software systems and services and appraisal services through four business units, which focus on the following products:

• financial management, education and planning, regulatory and maintenance software solutions;

• financial management, municipal courts, planning, regulatory and maintenance, and land and vital records management software solutions;

• courts and justice and public safety software solutions; and

• appraisal and tax software solutions and property appraisal services.

In accordance with ASC 280-10, Segment Reporting, the financial management, education and planning, regulatory and maintenance software solutions unit; financial management, municipal courts, planning, regulatory and maintenance, and land and vital records management software solutions unit; and the courts and justice and public safety software solutions unit meet the criteria for aggregation and are presented in one reportable segment, the Enterprise Software (“ES”) segment. The ES segment provides municipal and county governments and schools with software systems and services to meet their information technology and automation needs for mission-critical “back-office” functions such as financial management and courts and justice processes; public safety; planning, regulatory and maintenance; and land and vital records management. The Appraisal and Tax (“A&T”) segment provides systems and software that automate the appraisal and assessment of real and personal property as well as property appraisal outsourcing services for local governments and taxing authorities. Property appraisal outsourcing services include: the physical inspection of commercial and residential properties; data collection and processing; computer analysis for property valuation; preparation of tax rolls; community education; and arbitration between taxpayers and the assessing jurisdiction.

We evaluate performance based on several factors, of which the primary financial measure is business segment operating income. We define segment operating income for our business units as income before non-cash amortization of intangible assets associated with their acquisitions, interest expense and income taxes. Segment operating income includes intercompany transactions. The majority of intercompany transactions relate to contracts involving more than one unit and are valued based on the contractual arrangement. Segment operating income for corporate primarily consists of compensation costs for the executive management team and certain accounting and administrative staff and share-based compensation expense for the entire company. Corporate segment operating income also includes revenues and expenses related to a company-wide user conference.

For the three months ended June 30, 2017
	Enterprise Software		Appraisal and Tax		Corporate			Totals
Revenues
Software licenses and royalties	$	15,354	$	1,753	$	—		$	17,107
Subscriptions	39,051		1,896		—			40,947
Software services	42,696		4,676		—			47,372
Maintenance	84,306		5,106		—			89,412
Appraisal services	—		6,366		—			6,366
Hardware and other	3,295		—		4,624			7,919
Intercompany	2,486		—		(2,486		)	—
Total revenues	$	187,188	$	19,797	$	2,138		$	209,123
Segment operating income	$	54,130	$	4,410	$	(12,642	)	$	45,898

For the six months ended June 30, 2017
	Enterprise Software		Appraisal and Tax		Corporate			Totals
Revenues
Software licenses and royalties	$	31,928	$	3,402	$	—		$	35,330
Subscriptions	77,364		3,685		—			81,049
Software services	83,364		9,026		—			92,390
Maintenance	166,472		9,799		—			176,271
Appraisal services	—		12,978		—			12,978
Hardware and other	6,023		—		4,624			10,647
Intercompany	4,649		—		(4,649		)	—
Total revenues	$	369,800	$	38,890	$	(25	)	$	408,665
Segment operating income	$	106,181	$	8,624	$	(23,890	)	$	90,915

For the three months ended June 30, 2016
	Enterprise Software		Appraisal and Tax		Corporate			Totals
Revenues
Software licenses and royalties	$	16,439	$	1,112	$	—		$	17,551
Subscriptions	32,316		1,652		—			33,968
Software services	42,159		3,881		—			46,040
Maintenance	74,110		4,633		—			78,743
Appraisal services	—		6,984		—			6,984
Hardware and other	2,942		—		2,744			5,686
Intercompany	1,612		—		(1,612		)	—
Total revenues	$	169,578	$	18,262	$	1,132		$	188,972
Segment operating income	$	46,109	$	3,990	$	(10,051	)	$	40,048

For the six months ended June 30, 2016
	Enterprise Software		Appraisal and Tax		Corporate			Totals
Revenues
Software licenses and royalties	$	32,093	$	2,308	$	—		$	34,401
Subscriptions	64,301		3,756		—			68,057
Software services	80,763		7,707		—			88,470
Maintenance	145,510		9,265		—			154,775
Appraisal services	—		13,542		—			13,542
Hardware and other	5,977		16		3,027			9,020
Intercompany	2,772		—		(2,772		)	—
Total revenues	$	331,416	$	36,594	$	255		$	368,265
Segment operating income	$	86,778	$	8,821	$	(18,689	)	$	76,910

	Three months ended June 30,						Six months ended June 30,
Reconciliation of reportable segment operating income to the Company's consolidated totals:	2017			2016			2017			2016
Total segment operating income	$	45,898		$	40,048		$	90,915		$	76,910
Amortization of acquired software	(5,360		)	(5,680		)	(10,770		)	(11,139		)
Amortization of customer and trade name intangibles	(3,463		)	(3,453		)	(6,921		)	(6,815		)
Other expense, net	(101		)	(720		)	(291		)	(1,187		)
Income before income taxes	$	36,974		$	30,195		$	72,933		$	57,769