SEGMENT REPORTING

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

SEGMENT REPORTING

NOTE 13 – SEGMENT REPORTING

Our three operating segments are:

• Domestic and Canada Regulated Waste and Compliance Services (“Domestic and Canada RCS”),

• Domestic Communication and Related Services (“Domestic CRS”), and

• International Regulated Waste and Compliance Services (“International RCS”).

Domestic CRS does not meet the quantitative criteria to be a separate reportable segment and therefore is included in All other. Costs related to our corporate headquarter functions are also included in All other.

Our Domestic and Canada, and International Regulated Waste and Compliance Services segments include medical waste disposal, pharmaceutical waste disposal, hazardous waste management, sustainability solutions for expired or unused inventory, secure information destruction of documents and e-media, training and consulting through our Steri-Safe® and Clinical Services programs, and other regulatory compliance services.

Our Domestic Communication and Related Services segment consists of inbound/outbound communication, automated patient reminders, online scheduling, notifications, product retrievals, product returns, and quality audits.

Our two reportable segments are:

• Domestic and Canada RCS,

• International RCS.

The following tables show financial information for the Company's reportable segments:

In thousands
	Three Months Ended March 31,
	2017			2016
Revenues
Domestic and Canada RCS	$	633,733		$	616,131
International RCS		181,580			188,009
All other		77,086			70,041
Total	$	892,399		$	874,181
Gross Profit
Domestic and Canada RCS	$	278,103		$	273,915
International RCS		58,492			60,733
All other		32,067			31,932
Total	$	368,662		$	366,580
Intangible amortization
Domestic and Canada RCS	$	21,700		$	11,317
International RCS		5,344			4,977
All other		2,045			1,980
Total	$	29,089		$	18,274
Adjusted EBITA (a)
Domestic and Canada RCS	$	186,449		$	184,852
International RCS		20,045			18,931
All other		(36,124	)		(23,431	)
Total	$	170,370		$	180,352

(a) Adjusted EBITA is defined as income from operations exclusive of intangible amortization and other adjusting items reconciled in the table below.

The following table reconciles the Company's primary measure of segment profitability (EBITA) to income from operations:

In thousands
	Three Months Ended March 31,
	2017			2016
Adjusted EBITA (a)	$	170,370		$	180,352
Intangible amortization expenses (see Note 10)		(29,089	)		(18,274	)
Acquisition and integration expenses (see Note 3)		(19,820	)		(22,258	)
Litigation  and professional services expenses (b)		(3,620	)		(1,300	)
Restructuring, contract exit and plant conversion expenses (see Note 4)		(2,891	)		(241	)
Change in fair value of contingent consideration (see Note 9)		(401	)		2,644
Income from operations	$	114,549		$	140,923

(b) Litigation and professional services expenses generally consist of legal expenses to defend significant lawsuits and any related settlements as well as certain advisory and consultative services for significant project initiatives which are reflected as part of SG&A in our Condensed Consolidated Statements of Income.

The following table shows consolidated revenues by service:

In thousands
	Three Months Ended March 31,
	2017		2016
Regulated Waste and Compliance Services	$	511,177	$	506,581
Secure Information Destruction Services		204,075		184,630
Communication and Related Services		93,516		87,949
Manufacturing and Industrial Services		83,631		95,021
Revenues	$	892,399	$	874,181