(15) Segment Information

As of September 30, 2016, the Company’s operations consisted of its North America, Europe, and Corporate & Other segments. The Company’s ATM operations in the U.S., Canada, Mexico, and Puerto Rico are included in its North America segment. The Company’s ATM operations in the U.K., Ireland, Germany, Poland, Spain, and its ATM advertising business (i- design group plc (“i-design”)) are included in its Europe segment. The Company’s transaction processing operations, which service its North American and European operations along with external customers, and the Company’s corporate general and administrative functions comprise the Corporate & Other segment. In the first quarter of 2016, the Company reorganized and created the Corporate & Other segment to separately present transaction processing operations from its primary ATM operations and present the corporate general and administrative functions separate from the North America segment. Additionally, i-design was previously included within the North America segment and due to organizational changes, is now a part of the Europe segment. While both regional reporting segments provide similar kiosk-based and/or ATM-related services, each of the regional segments is managed separately and requires different marketing and business strategies. Similarly, the transaction processing and corporate general and administrative functions are also managed separately. Segment information presented for prior periods has been revised to reflect this change in segments.

Management uses Adjusted EBITDA and Adjusted EBITA, along with U.S. GAAP measures, to manage and measure the performance of its segments. Management believes Adjusted EBITDA and Adjusted EBITA are useful measures because they allow management to more effectively evaluate the performance of the business and compare its results of operations from period to period without regard to financing methods or capital structure. Adjusted EBITDA and Adjusted EBITA excludes amortization of intangible assets, stock-based compensation expense, acquisition and divestiture-related expenses, certain non-operating expenses, certain costs not anticipated to occur in future periods (if applicable in a particular period), gains or losses on disposal of assets, the Company’s obligations for the payment of income taxes, interest expense, and other obligations such as capital expenditures, and includes an adjustment for noncontrolling interests. Additionally, Adjusted EBITDA excludes depreciation and accretion expense. Depreciation and accretion expense and amortization of intangible assets are excluded as these amounts can vary substantially from company to company within the Company’s industry depending upon accounting methods and book values of assets, capital structures, and the methods by which the assets were acquired.

Adjusted EBITDA and Adjusted EBITA, as defined by the Company, are non-GAAP financial measures provided as a complement to results prepared in accordance with U.S. GAAP and may not be comparable to similarly-titled measures reported by other companies. In evaluating the Company’s performance as measured by Adjusted EBITDA and Adjusted EBITA, management recognizes and considers the limitations of these measurements. Accordingly, Adjusted EBITDA and Adjusted EBITA are only two of the measurements that management utilizes. Therefore, Adjusted EBITDA and Adjusted EBITA should not be considered in isolation or as a substitute for operating income, net income, cash flows from operating, investing, or financing activities, or other income or cash flow measures prepared in accordance with U.S. GAAP.

Below is a reconciliation of Net income attributable to controlling interests and available to common stockholders to EBITDA and Adjusted EBITA:


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
	(In thousands)
Net income attributable to controlling interests and available to common stockholders	$	27,490	$	22,009	$	63,022	$	52,239
Adjustments:
Interest expense, net		4,269		5,033		13,227		14,496
Amortization of deferred financing costs and note discount		2,872		2,859		8,636		8,455
Income tax expense		8,388		12,629		26,204		29,837
Depreciation and accretion expense		23,308		22,127		69,085		64,142
Amortization of intangible assets		9,175		10,048		28,129		29,040
EBITDA	$	75,502	$	74,705	$	208,303	$	198,209
Add back:
Loss (gain) on disposal of assets		469		(12,139)		(475)		(12,425)
Other expense (1)		360		1,067		748		2,882
Noncontrolling interests (2)		(15)		(336)		(50)		(1,047)
Stock-based compensation expense (3)		6,642		5,147		15,780		14,360
Acquisition and divestiture-related expenses (4)		2,680		13,289		4,938		21,207
Redomicile-related expenses (5)		951		—		12,201		—
Adjusted EBITDA	$	86,589	$	81,733	$	241,445	$	223,186
Less:
Depreciation and accretion expense (6)		23,301		22,014		69,063		63,767
Adjusted EBITA	$	63,288	$	59,719	$	172,382	$	159,419

⁽¹⁾

Includes foreign currency translation gains or losses and other non-operating costs.

⁽²⁾

Noncontrolling interest adjustment made such that Adjusted EBITDA includes only the Company’s ownership interest in the Adjusted EBITDA of its Mexico subsidiary. In December 2015, the Company increased its ownership interest in its Mexico subsidiary from 51.0% to 95.7%.

⁽³⁾

For the three and nine months ended September 30, 2015, amounts exclude a portion of the expenses incurred by the Company’s Mexico subsidiary to account for the amounts allocable to the noncontrolling interest stockholders. The Company’s Mexico subsidiary recognized no stock-based compensation expense for the three and nine months ended September 30, 2016.

⁽⁴⁾

Acquisition and divestiture-related expenses include costs incurred for professional and legal fees and certain other transition and integration-related costs.

⁽⁵⁾

Expenses associated with the Company’s redomicile of its parent company to the U.K., which was completed on July 1, 2016.

⁽⁶⁾

Amounts exclude a portion of the expenses incurred by the Company’s Mexico subsidiary to account for the amounts allocable to the noncontrolling interest stockholders. In December 2015, the Company increased its ownership interest in its Mexico subsidiary.

The following tables reflect certain financial information for each of the Company’s reporting segments for the three and nine months ended September 30, 2016 and 2015, respectively:


	Three Months Ended September 30, 2016
	North America		Europe		Corporate & Other		Eliminations		Total
	(In thousands)
Revenue from external customers	$	226,961	$	95,185	$	6,188	$	—	$	328,334
Intersegment revenues		—		378		6,079		(6,457)		—
Cost of revenues		146,786		58,907		8,954		(6,457)		208,190
Selling, general, and administrative expenses		14,504		8,437		17,253		—		40,194
Redomicile-related expenses		—		77		874		—		951
Acquisition and divestiture-related expenses		612		378		1,690		—		2,680
Loss (gain) on disposal of assets		510		(41)		—		—		469

Adjusted EBITDA		65,661		28,219		(7,285)		(6)		86,589

Depreciation and accretion expense		12,341		9,148		1,819		—		23,308
Adjusted EBITA		53,323		19,071		(9,112)		6		63,288

Capital expenditures (1)	$	17,843	$	18,098	$	538	$	—	$	36,479


	Three Months Ended September 30, 2015
	North America		Europe		Corporate & Other		Eliminations		Total
	(In thousands)
Revenue from external customers	$	207,362	$	98,652	$	5,336	$	—	$	311,350
Intersegment revenues		—		361		6,059		(6,420)		—
Cost of revenues		132,310		65,309		7,835		(6,420)		199,034
Selling, general, and administrative expenses		14,979		8,050		12,730		—		35,759
Acquisition and divestiture-related expenses		732		12,073		484		—		13,289
Loss (gain) on disposal of assets		571		(12,709)		(1)		—		(12,139)

Adjusted EBITDA		60,055		25,647		(4,012)		43		81,733

Depreciation and accretion expense		11,837		8,824		1,466		—		22,127
Adjusted EBITA		48,218		16,822		(5,534)		213		59,719

Capital expenditures (1)	$	37,085	$	10,245	$	129	$	—	$	47,459


	Nine Months Ended September 30, 2016
	North America		Europe		Corporate & Other		Eliminations		Total
	(In thousands)
Revenue from external customers	$	657,520	$	279,616	$	18,406	$	—	$	955,542
Intersegment revenues		—		1,042		17,663		(18,705)		—
Cost of revenues		428,557		178,556		25,985		(18,705)		614,393
Selling, general, and administrative expenses		44,753		26,542		44,210		—		115,505
Redomicile-related expenses		—		89		12,112		—		12,201
Acquisition and divestiture-related expenses		1,447		1,299		2,192		—		4,938
Loss (gain) on disposal of assets		1,266		(1,741)		—		—		(475)

Adjusted EBITDA		184,214		75,565		(18,343)		9		241,445

Depreciation and accretion expense		36,343		27,605		5,137		—		69,085
Adjusted EBITA		147,870		47,960		(23,478)		30		172,382

Capital expenditures (1)	$	37,353	$	37,532	$	1,165	$	—	$	76,050


	Nine Months Ended September 30, 2015
	North America		Europe		Corporate & Other		Eliminations		Total
	(In thousands)
Revenue from external customers	$	607,797	$	283,864	$	5,336	$	—	$	896,997
Intersegment revenues		—		1,069		16,321		(17,390)		—
Cost of revenues		389,723		198,159		16,884		(17,390)		587,376
Selling, general, and administrative expenses		44,387		23,927		32,515		—		100,829
Acquisition and divestiture-related expenses		3,860		16,802		545		—		21,207
Loss (gain) on disposal of assets		1,854		(14,278)		(1)		—		(12,425)

Adjusted EBITDA		173,719		62,846		(13,401)		22		223,186

Depreciation and accretion expense		35,239		25,759		3,144		—		64,142
Adjusted EBITA		138,480		37,086		(16,544)		397		159,419

Capital expenditures (1)	$	68,274	$	35,474	$	129	$	—	$	103,877

⁽¹⁾

Capital expenditure amounts include payments made for exclusive license agreements, site acquisition costs, and other intangible assets. Additionally, capital expenditure amounts for Mexico (included in the North America segment) are reflected gross of any noncontrolling interest amounts.

Identifiable Assets



	September 30, 2016		December 31, 2015
	(In thousands)
North America	$	876,272	$	870,445
Europe		365,201		382,920
Corporate & Other		71,653		66,570
Total	$	1,313,126	$	1,319,935