Segment Information

12 Months Ended

Dec. 31, 2011

Segment Information [Abstract]

Segment Information

(15) Segment Information

The Company operates in one industry segment, container leasing, but has two reportable business segments; container leasing and container management. The container leasing segment derives its revenue via the ownership and leasing of containers to container shipping lines. The container management segment derives its revenue from management fees earned from portfolios of containers and associated leases which are managed on behalf of container investors. The Company also derives revenue from the sale of containers to container investors who in turn enter into management agreements with the Company.

There are no inter-segment revenues.

With the exception of amortization of intangible assets and marketing, general and administrative expenses (MG&A), operating expenses are allocated directly to the container leasing segment. Amortization of intangible assets relating to owned and third party contracts is allocated directly to the container leasing segment and container management segment, respectively. The amortization of remaining intangible assets relating to the trademark and software is allocated to the segments based on average segment TEUs during the year.

During the year ended December 31, 2010, the Company refined its methodology for allocating MG&A expense to each segment based on a study which analyzed the departmental composition of MG&A expense. The expense allocation was based on either revenue or twenty-foot equivalent units (TEUs) of containers in each segment, depending on the function of the department which incurred the expense, after directly assigning MG&A expense relating to Consent and CAIJ subsidiaries to the container leasing and container management segment, respectively. Management believes that this allocation method results in a more representative distribution of MG&A expense between the two segments. Prior to the year ended December 31, 2010, the Company had been allocating MG&A expense to each segment based solely on the ratio of owned and managed TEUs to its total fleet of TEUs after directly assigning MG&A expense relating to Consent to the container leasing segment.

The Company makes its management decisions based on pre-tax income, and as such does not allocate income tax expense/benefit to its segments.

The allocation of assets between segments is determined by the direct allocation of the managed accounts receivable, the net carrying value of the intangible asset relating to third party contracts and a portion of the intangible asset relating to trademark and software (determined based on the percentage of average TEUs of managed containers to total average TEUs), to the managed container segment. The remaining balance of total assets is allocated to the container leasing business.

The following tables show segment information for the years ended December 31, 2011, 2010 and 2009, reconciled to the Company's income before taxes as shown in its consolidated statements of operations (in thousands):

	Year Ended December 31, 2011
	Container Leasing			Container Management		Unallocated			Total
Container rental revenue	$	106,694		$	-	$	-		$	106,694
Management fee revenue		-			12,957		-			12,957
Gain on sale of container portfolios		-			2,345		-			2,345
Finance lease income		3,710			-		-			3,710
Total revenue		110,404			15,302		-			125,706
Depreciation of container rental equipment		33,633			-		-			33,633
Amortization of intangible assets		625			629		-			1,254
Gain on disposition of used container equipment		(13,374	)		-		-			(13,374	)
Storage, handling and other expenses		5,513			-		-			5,513
Marketing, general and administrative expenses		14,412			6,597		-			21,009
Gain on foreign exchange		(354	)		-		-			(354	)
Total operating expenses		40,455			7,226		-			47,681
Operating income		69,949			8,076		-			78,025
Interest expense		16,139			-		-			16,139
Interest income		-			-		(12	)		(12	)
Net interest expense		16,139			-		(12	)		16,127
Net income before income taxes and non-controlling interest	$	53,810		$	8,076	$	12		$	61,898
Total assets	$	933,094		$	20,274	$	-		$	953,368

	Year Ended December 31, 2010
	Container Leasing			Container Management		Unallocated			Total
Container rental revenue	$	64,892		$	-	$	-		$	64,892
Management fee revenue		-			10,348		-			10,348
Gain on sale of container portfolios		-			614		-			614
Finance lease income		2,045			-		-			2,045
Total revenue		66,937			10,962		-			77,899
Depreciation of container rental equipment		20,807			-		-			20,807
Amortization of intangible assets		752			625		-			1,377
Gain on disposition of used container equipment		(9,112	)		-		-			(9,112	)
Storage, handling and other expenses		6,170			-		-			6,170
Marketing, general and administrative expenses		15,807			5,411		-			21,218
Loss on foreign exchange		513			-		-			513
Total operating expenses		34,937			6,036		-			40,973
Operating income		32,000			4,926		-			36,926
Interest expense		5,278			-		-			5,278
Interest income		-			-		(109	)		(109	)
Net interest expense		5,278			-		(109	)		5,169
Net income before income taxes and non-controlling interest	$	26,722		$	4,926	$	109		$	31,757
Total assets	$	592,080		$	21,372	$	-		$	613,452

	Year Ended December 31, 2009
	Container Leasing			Container Management		Unallocated			Total
Container rental revenue	$	53,747		$	-	$	-		$	53,747
Management fee revenue		-			8,546		-			8,546
Gain on sale of container portfolios		-			753		-			753
Finance lease income		2,218			-		-			2,218
Total revenue		55,965			9,299		-			65,264
Depreciation of container rental equipment		17,226			-		-			17,226
Amortization of intangible assets		805			761					1,566
Gain on disposition of used container equipment		(3,626	)		-		-			(3,626	)
Storage, handling and other expenses		8,717			-		-			8,717
Marketing, general and administrative expenses		14,042			4,806		-			18,848
Restructuring charges		972			-		-			972
Income on foreign exchange		(215	)		-		-			(215	)
Total operating expenses		37,921			5,567		-			43,488
Operating income		18,044			3,732		-			21,776
Interest expense		4,311			-		-			4,311
Interest income		-			-		(10	)		(10	)
Net interest expense		4,311			-		(10	)		4,301
Net income before income taxes and non-controlling interest	$	13,733		$	3,732	$	10		$	17,475

Geographic Segment Information

The Company's container lessees use containers for their global trade utilizing many worldwide trade routes. The Company earns its revenue from international carriers when the containers are in use and carrying cargo around the world. Most of the Company's leasing related revenue is denominated in U.S. dollars. All of the Company's containers are used internationally and no one container is domiciled in one particular place for a prolonged period of time. As such, all of the Company's long-lived assets are considered to be international with no single country of use.