Segment Information

6 Months Ended

12 Months Ended

Jun. 30, 2011

Dec. 31, 2010

Business Segments

Business Segments

13. Segment Information

        Our reporting segments consist of Medical Equipment Outsourcing, Technical and Professional Services, and Medical Equipment Sales and Remarketing. Segment assets for the three business segments (excluding Corporate and Unallocated) primarily include goodwill and intangible assets, which is consistent with the Company's reporting to its Chief Operating Decision Maker. Other assets are not allocated to the three business segments. Thus, assets included in Corporate and Unallocated contain all other Company assets. Certain operating information for our segments as well as a reconciliation of total Company gross margin to loss before income tax was as follows:

Medical Equipment Outsourcing
(in thousands)

		Three Months Ended June 30,				Six Months Ended June 30,
		2011		2010		2011		2010
Revenues		$	73,847	$	60,818	$	140,086	$	125,992
Cost of revenue			28,466		22,452		52,900		45,069
Medical equipment depreciation			17,505		17,358		34,673		34,815
	Gross margin	$	27,876	$	21,008	$	52,513	$	46,108

Technical and Professional Services
(in thousands)

		Three Months Ended June 30,				Six Months Ended June 30,
		2011		2010		2011		2010
Revenues		$	11,361	$	11,152	$	22,231	$	21,965
Cost of revenue			8,227		8,064		16,110		15,848
	Gross margin	$	3,134	$	3,088	$	6,121	$	6,117

Medical Equipment Sales and Remarketing
(in thousands)

		Three Months Ended June 30,				Six Months Ended June 30,
		2011		2010		2011		2010
Revenues		$	5,876	$	4,763	$	11,482	$	8,950
Cost of revenue			4,600		3,724		8,900		7,071
	Gross margin	$	1,276	$	1,039	$	2,582	$	1,879

Total Gross Margin and Reconciliation to Loss Before Income Tax
(in thousands)

		Three Months Ended June 30,						Six Months Ended June 30,
		2011			2010			2011			2010
Total gross margin		$	32,286		$	25,135		$	61,216		$	54,104
Selling, general and administrative			27,111			20,982			49,491			42,052
Acquisition and integration expenses			1,225			—			1,999			—
Interest expense			12,745			11,855			24,450			23,362
	Loss before income tax	$	(8,795	)	$	(7,702	)	$	(14,724	)	$	(11,310	)

Total Assets by Reporting Segment
(in thousands)

		June 30, 2011		December 31, 2010
Medical Equipment Outsourcing		$	444,497		409,315
Technical and Professional Services			87,726		85,175
Medical Equipment Sales and Remarketing			18,603		18,603
Corporate and Unallocated			418,964		319,935
	Total Company Assets	$	969,790		833,028

14. Business Segments

        The Company operates in three reportable segments:

• •

  Medical equipment outsourcing is the segment which the Company provides medical equipment outsourcing services to its customers, including more than 4,250 acute care hospitals and 4,350 alternate site providers in the United States, including some of the nation's premier health care institutions.

  •

  Technical and professional services offers a broad range of inspection, preventative maintenance, repair, logistic and consulting services through the Company's team of over 325 technicians and professionals located in its nationwide network of offices.

   

  •

  Medical equipment sales and remarketing is the segment through which the Company buys, sources, remarkets and disposes of pre-owned medical equipment for its customers through the Company's Asset Recovery Program; provides sales and distribution of specialty medical equipment; and offers its customers disposable items that are used on a single use basis.

        The Company identifies its segments based on its organizational structure and its internal reporting.

			Year Ended December 31,
(in thousands)			2010			2009			2008
Medical Equipment Outsourcing
	Net Sales		$	250,455		$	232,623		$	223,676
	Gross margin			89,439			84,803			79,895
	Assets			409,315			420,940			432,643
	Amortization and Depreciation			11,625			11,793			12,643
Technical and Professional Services
	Net Sales			44,426			42,395			45,225
	Gross margin			12,736			11,856			12,549
	Assets			85,175			85,867			86,559
	Amortization and Depreciation			692			692			692
	Intangible asset impairment charge			—			—			4,000
Medical Equipment Sales and Remarketing
	Net Sales			22,541			22,186			20,218
	Gross margin			6,199			4,009			4,745
	Assets			18,603			18,603			18,603
Corporate and Unallocated
	Assets			319,935			309,993			339,920
	Amortization and Depreciation			79,422			74,562			72,488
	Capital Expenditures			76,998			53,527			73,903
Total Company Assets, Amortization and Depreciation and Capital Expenditures
	Assets			833,028			835,403			877,725
	Amortization and Depreciation			91,739			87,047			85,823
	Capital Expenditures			76,998			53,527			73,903
	Impairment charge			—			—			4,000
Total Gross Margin and Reconciliation to Loss Before Income Taxes
	Total gross margin		$	108,374		$	100,668		$	97,189
	Selling, general and administrative			89,336			84,225			85,166
	Intangible asset impairment charge			—			—			4,000
	Interest expense			46,457			46,505			46,878
		Loss before income tax	$	(27,419	)	$	(30,062	)	$	(38,855	)

        Gross margin represents net revenues less total direct costs.

        Segment assets for the three business segments (excluding Corporate and Unallocated) primarily include goodwill and intangible assets, which is consistent with the Company's reporting to its Chief Operating Decision Maker, other assets are not allocated to the three business segments. Thus, assets included in Corporate and Unallocated contain all other Company assets.