NOTE 19 – SEGMENT AND GEOGRAPHIC DATA

Historically, our business activities were organized into two reportable segments – Wireless DataCom and Satellite. Effective August 31, 2016, we ceased operations of the Satellite business and reported thereafter through the first quarter of fiscal 2018 under one reportable segment: Wireless DataCom. In the quarter ended August 31, 2017, we realigned our operations and now operate under two reportable segments: Telematics Systems and Software & Subscription Services. Our organizational structure is based on a number of factors that our CEO, the Chief Operating Decision Maker (“CODM”), uses to evaluate and operate the business, which include customer base, homogeneity of products, and technology. We have recast prior period amounts to conform to the way we internally manage and monitor segment performance.

The Telematics Systems segment offers a portfolio of wireless data communications products which includes asset tracking units, mobile telematics devices, fixed and mobile wireless gateways and routers. These wireless networking devices underpin a wide range of our own and third party software and service solutions worldwide and are critical for applications demanding secure, reliable and business-critical communications.

The Software & Subscription Services segment offers cloud-based, application enablement and telematics service platforms that facilitate integration of our own applications, as well as those of third parties, through open Applications Programing Interfaces (“APIs”) to deliver full-featured IoT solutions to a wide range of customers and markets. Our scalable proprietary SaaS offerings enable rapid and cost-effective deployment of high-value solutions for customers all around the globe.

Information by business segment is as follows (in thousands):

	Year ended February 28, 2018
	Operating Segments
	Telematics Systems		Software & Subscription Services		Corporate Expenses			Total
Revenues	$	302,126	$	63,786	$	-		$	365,912
Adjusted EBITDA	$	48,943	$	8,233	$	(4,794	)	$	52,382

	Year ended February 28, 2017
	Operating Segments
	Telematics Systems		Software & Subscription Services		Satellite		Corporate Expenses			Total
Revenues	$	274,314	$	61,719	$	15,069	$	-		$	351,102
Adjusted EBITDA	$	47,432	$	3,075	$	2,447	$	(3,586	)	$	49,368

	Year ended February 28, 2016
	Operating Segments
	Telematics Systems		Software & Subscription Services		Satellite		Corporate Expenses			Total
Revenues	$	205,209	$	36,178	$	39,332	$	-		$	280,719
Adjusted EBITDA	$	34,051	$	9,677	$	8,573	$	(3,294	)	$	49,007

	Operating Segments
	Telematics Systems		Software & Subscription Services		Satellite		Total
Goodwill
As of February 28, 2018	$	50,899	$	22,081	$	-	$	72,980
As of February 28, 2017	$	50,899	$	22,081	$	-	$	72,980

The amount shown for each period in the “Corporate Expenses” column above consists of expenses that are not allocated to the business segments. These nonallocated corporate expenses include salaries and benefits of certain corporate staff and expenses such as audit fees, investor relations, stock listing fees, director and officer liability insurance, and director fees and expenses.

Our CODM evaluates each segment based on Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”), and we therefore consider Adjusted EBITDA to be a primary measure of operating performance of our operating segments. We define Adjusted EBITDA as earnings before investment income, interest expense, taxes, depreciation, amortization and stock-based compensation and other adjustments as identified below. The adjustments to our financial results prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) to calculate Adjusted EBITDA are itemized below (in thousands):

	Year Ended February 28,
	2018			2017			2016
Net income (loss)	$	16,617		$	(7,904	)	$	16,940
Investment income		(2,256	)		(1,691	)		(1,871	)
Interest expense		10,280			9,896			7,595
Income tax provision (benefits)		10,681			(1,563	)		4,572
Depreciation		7,968			8,408			3,582
Amortization of intangible assets		14,989			15,061			6,626
Stock-based compensation		9,298			7,833			5,854
Equity in net loss of affiliate		1,411			1,284			829
Acquisition and integration expenses		-			4,513			1,980
Non-cash adjustment to inventory and fixed asset		335			4,339			-
Legal expenses for LoJack battery performance issue		3,323			1,948			-
Litigation provision		7,415			7,244			2,900
Gain on LoJack battery performance legal Settlement		(28,333	)		-			-
Other		654			-			-
Adjusted EBITDA	$	52,382		$	49,368		$	49,007

It is not practicable for us to report identifiable assets by segment because these businesses share resources, functions and facilities.

We do not have significant long-lived assets outside the United States.

Revenue by geographic area are as follows (in thousands):

	Year Ended February 28,
	2018		2017		2016
United States	$	265,613	$	259,974	$	232,995
Europe, Middle East and Africa		45,830		49,918		19,178
South America		20,699		17,738		9,019
Canada		14,958		8,412		7,752
Asia and Pacific Rim		12,873		8,967		4,524
All other		5,939		6,093		7,251
	$	365,912	$	351,102	$	280,719

Revenues by geographic area are based upon the country of billing. The geographic location of distributors and OEM customers may be different from the geographic location of the ultimate end users of the products and services provided by us. No single non-U.S. country accounted for more than 10% of our revenue in fiscal years ended February 28, 2018, 2017 and 2016.