Business Segments

12 Months Ended

Sep. 30, 2014

Business Segments

Segment Reporting Disclosure

19.  BUSINESS SEGMENTS

We view our business in two operating segments , North America and International, each incorporating all revenue categories—Gaming Operations, Product Sales, and Interactive.

NORTH AMERICA, comprising 79 % of consolidated revenues in 2014, 78 % in 2013 and 76 % in 2012, includes operations associated with our land-based and online real-money customers located in the US and Canada, as well as all customers serviced by our US-based social gaming operations.

INTERNATIONAL, comprising 21 % of consolidated revenues in 2014, 22 % in 2013, and 24 % in 2012, consists of our land-based and online real-money customers located in all other jurisdictions worldwide.

Certain income and expenses related to company-wide initiatives, primarily comprised of general and administrative costs and other income (expense), are managed at the corporate level and not allocated to an operating segment. Our business segments are designed to allocate resources within a framework of management responsibility. Operating costs included in one segment may benefit other segments. Ongoing realignment of business development and administrative functions may result in ongoing changes to allocations of operating cost amongst our operating segments.

We do not recognize inter-company revenues or expenses upon the transfer of gaming products between operating segments. Segment accounting policies are consistent with those of our consolidated financial statements and segment profit is measured on the basis of operating income. Impairment and restructuring charges (see Note 20) are reflected within the segment where actions occurred.

BUSINESS SEGMENTS FINANCIAL INFORMATION

Years Ended September 30,	2014		2013		2012
NORTH AMERICA
Revenues	$	1,619.2	$	1,835.1	$	1,644.1
Gaming operations		770.1		854.2		907.8
Product sales		562.5		759.8		648.2
Interactive		286.6		221.1		88.1
Gross profit		966.9		1,066.9		961.2
Gaming operations		462.9		522.4		541.2
Product sales		324.9		407.3		366.6
Interactive		179.1		137.2		53.4
Operating income		427.7		487.9		425.8
Depreciation and amortization		148.1		190.4		195.3
Long-lived assets		373.8		479.8		590.3
Additions to long-lived assets		67.9		103.3		146.2
Total assets		2,758.4		2,745.6		2,560.0

INTERNATIONAL
Revenues	$	438.9	$	506.5	$	506.6
Gaming operations		116.8		137.2		132.2
Product sales		284.5		325.4		318.6
Interactive		37.6		43.9		55.8
Gross profit		247.7		277.5		276.4
Gaming operations		84.5		94.7		93.1
Product sales		140.0		157.7		155.7
Interactive		23.2		25.1		27.6
Operating income		90.6		120.1		103.6
Depreciation and amortization		34.1		35.3		40.3
Long-lived assets		36.5		51.1		79.4
Additions to long-lived assets		14.9		7.3		40.1
Total assets		695.9		760.1		812.7

CORPORATE (unallocated)
Operating expense	$	(109.7	)	$	(113.9	)	$	(107.7	)
Depreciation and amortization		6.8			5.9			4.7
Long-lived assets		83.3			83.6			79.4
Additions to long-lived assets		6.8			19.1			23.9
Total assets		535.2			1,107.1			912.4

CONSOLIDATED
Revenues	$	2,058.1	$	2,341.6	$	2,150.7
Gaming operations		886.9		991.4		1,040.0
Product sales		847.0		1,085.2		966.8
Interactive		324.2		265.0		143.9
Gross profit		1,214.6		1,344.4		1,237.6
Gaming operations		547.4		617.1		634.3
Product sales		464.9		565.0		522.3
Interactive		202.3		162.3		81.0
Operating income		408.6		494.1		421.7
Depreciation and amortization		189.0		231.6		240.3
Long-lived assets		493.6		614.5		749.1
Additions to long-lived assets		89.6		129.7		210.2
Total assets		3,989.5		4,612.8		4,285.1

GEOGRAPHICAL INFORMATION

Revenues below were identified by customer location, except social gaming was by selling location.

Years Ended September 30,	2014		2013		2012
US	$	1,518.9	$	1,612.2	$	1,490.1
Non-US		539.2		729.4		660.6
Total revenues	$	2,058.1	$	2,341.6	$	2,150.7