Segment Information

6 Months Ended

Jun. 30, 2015

Segment Information

Segment Information

13.  Segment Information

The Company operates in two reportable segments of telecommunications and data center colocation.  This conclusion is based on how resources are allocated and performance is assessed by the Chief Executive Officer, the Company’s chief operating decision maker.  The telecommunications segment provides local voice services, video, high-speed internet and long distance voice services.  In addition, the segment provides network access which includes data transport.  Various related telephony services are provided including equipment and managed services.  The data center colocation segment provides physical colocation, virtual colocation and various related telephony services.

The following table provides operating financial information for the Company’s reportable segments for the three and six months ended June 30, 2015 and 2014 (dollars in thousands):

	Tele-		Data Center			Intersegment
	communications		Colocation			Elimination			Total
Three months ended June 30, 2015
Operating revenues	$	93,812	$	2,784		$	(409	)	$	96,187
Depreciation and amortization	21,374		567			—			21,941
Operating income (loss)	5,570		(310		)	—			5,260
Three months ended June 30, 2014
Operating revenues	$	94,700	$	2,323		$	(239	)	$	96,784
Depreciation and amortization	18,467		417			—			18,884
Operating income (loss)	8,126		(234		)	—			7,892
Six months ended June 30, 2015
Operating revenues	$	188,649	$	5,381		$	(727	)	$	193,303
Depreciation and amortization	42,102		1,119			—			43,221
Operating income (loss)	11,818		(637		)	—			11,181
Capital expeditures	46,377		578			—			46,955
Six months ended June 30, 2014
Operating revenues	$	189,576	$	4,728		$	(448	)	$	193,856
Depreciation and amortization	36,781		823			—			37,604
Operating income (loss)	16,166		(136		)	—			16,030
Capital expeditures	50,716		345			—			51,061

Intersegment revenue represents primarily network access services provided by the telecommunications segment for data center colocation.  For the three and six months ended June 30, 2015 and 2014, total operating income above reconciles to the condensed consolidated statement of income as follows (dollars in thousands):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2015			2014			2015			2014
Operating income	$	5,260		$	7,892		$	11,181		$	16,030
Corporate other expense	(4,162		)	(4,104		)	(8,492		)	(8,285		)
Income before income tax provision	$	1,098		$	3,788		$	2,689		$	7,745

The following table provides information on the Company’s revenue, net of intersegment eliminations, by product group (dollars in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2015		2014		2015		2014
Local voice and other retail services	$	63,142	$	62,951	$	126,354	$	125,887
Network access services	30,261		31,510		61,568		63,241
Data center colocation	2,784		2,323		5,381		4,728
	$	96,187	$	96,784	$	193,303	$	193,856