Business Segments

12 Months Ended

Dec. 31, 2012

Business Segments

Segment Reporting Disclosure [Text Block]

(12) Business Segments

As of December 31, 2012, we operated through five reportable business segments: (i) Learning Solutions, (ii) Professional & Technical Services, (iii) Sandy Training & Marketing, (iv) Performance Readiness Solutions (formerly RWD), and (v) Energy Services. Our Learning Solutions segment represents an aggregation of two operating groups in accordance with the aggregation criteria in U.S. GAAP, while all of the other reportable segments each represent one operating group. We are organized by operating group primarily based upon the markets served by each group and/or the services performed. Each operating group consists of business units which are focused on providing specific products and services to certain classes of customers or within targeted markets. Marketing and communications, accounting, finance, legal, human resources, information systems and other administrative services are organized at the corporate level. Business development and sales resources are aligned with operating groups to support existing customer accounts and new customer development.

Further information regarding our business segments is discussed below.

Learning Solutions. The Learning Solutions segment delivers training, curriculum design and development, e-Learning services, system hosting, training business process outsourcing and consulting services primarily to large companies in the electronics and semiconductors, healthcare, software, financial and other industries as well as to government agencies. The ability to deliver a wide range of training services on a global basis allows this segment to take over the entire learning function for the client, including their training personnel. The October 2012 acquisition of BlessingWhite added proprietary leadership training content and employee engagement tools and services to this segment’s offerings.

Professional & Technical Services. This segment has over four decades of experience providing training, consulting, engineering and technical services, including lean consulting, emergency preparedness, safety and regulatory compliance, chemical demilitarization and environmental services primarily to large companies in the manufacturing, steel, pharmaceutical and petrochemical industries, federal and state government agencies and large government contractors. This segment also provides services to users of alternative fuels, including designing and constructing liquefied natural gas (LNG), liquid to compressed natural gas (LCNG) and hydrogen fueling stations, as well as supplying fuel and equipment.

Sandy Training & Marketing. The Sandy segment provides custom product sales training and has been a leader in serving manufacturing customers in the U.S. automotive industry for over 30 years. Sandy provides custom product sales training designed to better educate customer sales forces with respect to new vehicle features and designs, in effect rapidly increasing the sales force knowledge base and enabling them to address detailed customer queries. Furthermore, Sandy helps our clients assess their customer relationship marketing strategy, measure performance against competitors and connect with their customers on a one-to-one basis. This segment also provides technical training services to automotive manufacturers as well as customers in other industries.

Performance Readiness Solutions. Formerly named RWD, this segment represents a portion of the consulting business acquired from RWD Technologies, LLC in April 2011. Certain of the other acquired RWD business units are managed within the Professional & Technical Services and Sandy segments discussed above. Performance Readiness Solutions provides human capital management and IT consulting services, end-user training, change management, knowledge management and operator effectiveness management solutions in industries such as manufacturing, aerospace, healthcare, life sciences, consumer products, financial, telecommunications, services and higher education as well as the public sector.

Energy Services. The Energy Services segment provides engineering services, products and training primarily to electric power utilities. Our proprietary EtaPro^TM Performance and Condition Monitoring System provides a suite of performance and reliability solutions for power generation plants and is installed at over 1,000 power generating units in 34 countries. In addition to providing custom training solutions, this segment provides web-based training through our GPiLearn^TM portal, which offers over 1,300 courses to over 30,000 power plant personnel in the U.S. and in over 40 countries.

We do not allocate the following items to the segments: other income, interest expense, gain (loss) on change in fair value of contingent consideration and income tax expense. Inter-segment revenue is eliminated in consolidation and is not significant.

Prior to the merger of GP Strategies Corporation and General Physics on December 31, 2011, we did not allocate certain corporate selling, general and administrative (SG&A) expenses to our operating segments. After the merger, we began allocating these costs to the operating segments on a consistent basis as other SG&A expenses. As a result, we have reclassified the prior period operating income by segment amounts below to allocate the corporate SG&A expenses that were previously not allocated.

The following table sets forth the revenue and operating results attributable to each reportable segment and includes a reconciliation of segment revenue to consolidated revenue and operating results to consolidated income before income tax expense (in thousands):

	Years ended December 31,
	2012			2011			2010
Revenue:
Learning Solutions	$	161,455		$	130,392		$	118,922
Professional & Technical Services		87,844			85,285			70,893
Sandy Training & Marketing		70,243			54,604			47,153
Performance Readiness Solutions		55,794			40,079			—
Energy Services		26,236			22,807			22,958
	$	401,572		$	333,167		$	259,926
Operating income:
Learning Solutions	$	16,487		$	9,700		$	9,074
Professional & Technical Services		5,717			7,526			3,310
Sandy Training & Marketing		4,897			3,018			1,518
Performance Readiness Solutions		2,548			601			—
Energy Services		6,822			5,540			5,322
Gain on reversal of deferred rent liability		—			1,041			—
Gain (loss) on change in fair value of contingent consideration, net		(789	)		517			1,313
Operating income		35,682			27,943			20,537
Interest expense		(269	)		(209	)		(236	)
Other income		389			657			551
Income before income tax expense	$	35,802		$	28,391		$	20,852

Additional information relating to our business segments is as follows (in thousands):

	December 31,
	2012		2011
Identifiable assets:
Learning Solutions	$	116,753	$	95,389
Professional & Technical Services		56,160		59,675
Sandy Training & Marketing		24,250		16,819
Performance Readiness Solutions		27,472		25,747
Energy Services		19,799		13,946
Total assets	$	244,434	$	211,576

Corporate and other assets which consist primarily of cash and cash equivalents, other assets, and deferred tax assets and liabilities are allocated to the segments based on their respective percentage of consolidated revenues.

	Years ended December 31,
	2012		2011		2010
Additions to property, plant and equipment:
Learning Solutions	$	1,004	$	1,116	$	380
Professional & Technical Services		299		1,068		336
Sandy Training & Marketing		38		6		9
Performance Readiness Solutions		61		161		—
Energy Services		203		48		31
Corporate and other		931		1,576		775
	$	2,536	$	3,975	$	1,531
Depreciation and amortization:
Learning Solutions	$	3,794	$	2,695	$	1,824
Professional & Technical Services		439		294		327
Sandy Training & Marketing		428		424		478
Performance Readiness Solutions		1,102		871		—
Energy Services		357		353		386
Corporate and other		1,851		1,550		1,215
	$	7,971	$	6,187	$	4,230

Information about our revenue in different geographic regions, which are attributable to our wholly owned subsidiaries located in the United Kingdom, Canada, Netherlands, Denmark, Germany, France, Mexico, Colombia, Singapore, China and India is as follows (in thousands):

	Years ended December 31,
	2012		2011		2010
United States	$	323,867	$	274,010	$	214,194
United Kingdom		61,102		48,151		36,518
Other		16,603		11,006		9,214
	$	401,572	$	333,167	$	259,926

 Information about our total assets in different geographic regions is as follows (in thousands):

	December 31,
	2012		2011
United States	$	188,596	$	165,482
United Kingdom		40,163		39,033
Other		15,675		7,061
	$	244,434	$	211,576