Segment Information

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Segment Information

Segment Information

Reportable Operating Segments

U.S. GAAP establishes standards for reporting information regarding operating segments in annual financial statements. Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the chief operating decision-maker, or decision-making group in making decisions on how to allocate resources and assess performance.

We manage and evaluate our operations in two reportable segments: Housekeeping (housekeeping, laundry, linen and other services), and Dietary (dietary department services). Although both segments serve the same client base and share many operational similarities, they are managed separately due to distinct differences in the type of service provided, as well as the specialized expertise required of the professional management personnel responsible for delivering the respective segment’s services. We consider the various services provided within each reportable segment to comprise an identifiable reportable operating segment since such services are rendered pursuant to a single service agreement, specific to that reportable segment, as well as the fact that the delivery of the respective reportable segment’s services are managed by the same management personnel of the particular reportable segment.

The Company’s accounting policies for the segments are generally the same as the Company’s significant accounting policies. Differences between the reportable segments’ operating results and other disclosed data and our consolidated financial statements relate primarily to corporate level transactions and recording of transactions at the reportable segment level which use methods other than generally accepted accounting principles. There are certain inventories and supplies that are primarily expensed when incurred within the operating segments, while they are capitalized for the consolidated financial statements. As discussed, most corporate expense is not allocated to the operating segments, and such expenses include corporate salary and benefit costs, bad debt expense, certain legal costs, information technology costs, depreciation, amortization of finite lived intangibles, share based compensation costs and other corporate specific costs. Additionally, there are allocations for workers compensation and general liability expense within the operating segments that differ from our actual expense recorded for U.S. GAAP. Additionally, included in the differences between the reportable segments’ operating results and other disclosed data are amounts attributable to Huntingdon, our investment holding company subsidiary. Huntingdon does not transact any business with the reportable segments. Segment amounts disclosed are prior to any elimination entries made in consolidation.

Housekeeping provides services in Canada, although essentially all of its revenues and net income, 99% in both categories, are earned in one geographic area, the United States. Dietary provides services solely in the United States.

	Housekeeping Services		Dietary Services		Corporate and Eliminations				Total
Year Ended December 31, 2013
Revenues	$	759,093,000	$	390,797,000	$	—			$	1,149,890,000
Income before income taxes	68,872,000		21,244,000		(23,627,000		)	(1)	66,489,000
Depreciation and amortization	5,105,000		693,000		406,000				6,204,000
Total assets	213,397,000		92,424,000		119,521,000			(2)	425,342,000
Capital expenditures	$	2,726,000	$	460,000	$	576,000			$	3,762,000
Year Ended December 31, 2012
Revenues	$	737,407,000	$	339,855,000	$	173,000		(1)	$	1,077,435,000
Income before income taxes	69,429,000		18,474,000		(17,639,000		)	(1)	70,264,000
Depreciation and amortization	4,069,000		676,000		371,000				5,116,000
Total assets	144,412,000		62,263,000		124,508,000			(2)	331,183,000
Capital expenditures	$	2,765,000	$	453,000	$	266,000			$	3,484,000
Year Ended December 31, 2011
Revenues	$	654,886,000	$	234,247,000	$	(68,000	)	(1)	$	889,065,000
Income before income taxes	63,395,000		11,678,000		(17,261,000		)	(1)	57,812,000
Depreciation and amortization	3,428,000		614,000		345,000				4,387,000
Total assets	135,223,000		57,034,000		97,438,000			(2)	289,695,000
Capital expenditures	$	4,697,000	$	372,000	$	476,000			$	5,545,000

(1) represents primarily corporate office cost and related overhead, recording of transactions at the reportable segment level which use methods other than generally accepted accounting principles, as well as consolidated subsidiaries’ operating expenses that are not allocated to the reportable segments, net of investment and interest income.

(2) represents primarily cash and cash equivalents, marketable securities, deferred income taxes and other current and noncurrent assets.

Total Revenues from Clients

The following revenues earned from clients differ from segment revenues reported above due to the inclusion of adjustments used for segment reporting purposes by management. We earned total revenues from clients in the following service categories:

	Year Ended December 31,
	2013		2012		2011
Housekeeping services	$	514,180,000	$	492,319,000	$	440,924,000
Laundry and linen services	241,540,000		240,670,000		210,896,000
Dietary services	390,797,000		339,867,000		234,542,000
Maintenance services and other	3,373,000		4,579,000		2,703,000
	$	1,149,890,000	$	1,077,435,000	$	889,065,000