Segment Information

6 Months Ended

Jun. 30, 2013

Segment Reporting [Abstract]

Segment Information

Segment Information

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. In accordance with ASC 280, “Segment Reporting,” and based on the nature of the financial information that is received by the CODM, the Company operates in two operating segments, which are also its two reportable segments, Imaging and Radiation Oncology, based on similar economic and other characteristics.

The Imaging segment is comprised of diagnostic imaging services including MRI, PET/CT and other imaging services. The Radiation Oncology segment is comprised of radiation oncology services. All intercompany revenues, expenses, payables and receivables are eliminated in consolidation and are not reviewed when evaluating segment performance. Each segment’s performance is evaluated based on Revenue, Segment Income and Net Income. The accounting policies of the segments are the same as those described in the summary of significant accounting policies in Note 1 of the Notes to the Consolidated Financial Statements on Form 10-K for the year ended December 31, 2012. Additionally, the Company does not consider its wholesale revenue and retail revenue sources to constitute separate operating segments as discrete financial information does not exist and is not provided to the CODM.

The following table summarizes the Company’s revenue by segment:

	Quarter Ended June 30,				Six Months Ended June 30,
	2012		2013		2012		2013
Revenue
Imaging	$	98,163	$	94,613	$	198,998	$	186,586
Radiation Oncology	22,501		19,805		42,419		38,214
Total	$	120,664	$	114,418	$	241,417	$	224,800

The following are components of revenue:

	Quarter Ended June 30,				Six Months Ended June 30,
	2012		2013		2012		2013
Revenue
MRI revenue	$	49,157	$	47,359	$	99,234	$	93,440
PET/CT revenue	39,573		37,656		80,586		74,406
Radiation Oncology revenue	22,501		19,805		42,419		38,214
Other modalities and other revenue	9,433		9,598		19,178		18,740
Total	$	120,664	$	114,418	$	241,417	$	224,800

Segment income represents net income (loss) before income taxes; interest expense and other, net; amortization expense; depreciation expense; share-based payment; severance and related costs; noncontrolling interest in subsidiaries; restructuring charges; transaction costs; impairment charges and other non-cash charges. Segment income is the most frequently used measure of each segment’s performance by the CODM and is commonly used in setting performance goals. The following table summarizes the Company’s segment income:

	Quarter Ended June 30,						Six Months Ended June 30,
	2012			2013			2012			2013
Segment income
Imaging	$	37,528		$	38,311		$	76,033		$	73,474
Radiation Oncology	9,800			9,121			17,506			16,806
Corporate / Other	(7,920		)	(8,847		)	(16,373		)	(16,534		)
Total	$	39,408		$	38,585		$	77,166		$	73,746

The reconciliation of Net loss to total segment income is shown below:

	Quarter Ended June 30,						Six Months Ended June 30,
	2012			2013			2012			2013
Net loss attributable to Alliance HealthCare Services, Inc.	$	(801	)	$	(12,964	)	$	(5,623	)	$	(15,382	)
Income tax (benefit) expense	(2,427		)	(7,195		)	(5,069		)	(7,333		)
Interest expense and other, net	13,679			11,053			27,367			23,325
Amortization expense	3,994			2,911			8,006			6,705
Depreciation expense	20,693			16,322			42,138			32,838
Share-based payment (included in selling, general and administrative expenses)	(840		)	329			36			735
Noncontrolling interest in subsidiaries	2,728			3,509			4,978			6,339
Restructuring charges (Note 2)	873			1,890			2,995			3,363
Transaction costs	20			—			379			80
Impairment charges	—			4,867			—			4,867
Loss on extinguishment of debt	—			17,069			—			17,069
Other non-recurring charges (included in selling, general and administrative expenses	—			633			—			950
Other non-cash charges (included in other income and expense, net)	1,489			161			1,959			190
Total segment income	$	39,408		$	38,585		$	77,166		$	73,746

Net income for the Imaging and Radiation Oncology segments does not include charges for interest expense, net of interest income, income taxes or certain selling, general and administrative expenses. These costs are charged against the Corporate / Other segment. The following table summarizes the Company’s net income (loss) by segment:

	Quarter Ended June 30,						Six Months Ended June 30,
	2012			2013			2012			2013
Net (loss) income
Imaging	$	15,280		$	18,093		$	31,188		$	37,746
Radiation Oncology	3,771			2,782			5,282			4,031
Corporate / Other	(19,852		)	(33,839		)	(42,093		)	(57,159		)
Total	$	(801	)	$	(12,964	)	$	(5,623	)	$	(15,382	)

The following table summarizes the Company’s identifiable assets by segment:

	As of December 31, 2012		As of June 30, 2013
Identifiable assets
Imaging	$	282,906	$	269,426
Radiation Oncology	176,353		182,900
Corporate / Other	100,882		75,852
Total	$	560,141	$	528,178

The following table summarizes the Company’s goodwill by segment:

	Imaging			Radiation Oncology			Corporate / Other		Total
Balance at January 1, 2012	$	41,684		$	14,809		$	—	$	56,493
Goodwill acquired during the period	—			—			—		—
Impairment charges	—			—			—		—
Adjustments to goodwill during the period	—			—			—		—
Balance at December 31, 2012	$	41,684		$	14,809		$	—	$	56,493
Goodwill acquired during the period	—			—			—		—
Impairment charges	—			—			—		—
Adjustments to goodwill during the period	—			—			—		—
Balance at June 30, 2013	$	41,684		$	14,809		$	—	$	56,493
Gross goodwill	$	196,026		$	34,711		$	—	$	230,737
Accumulated impairment charges	(154,342		)	(19,902		)	—		(174,244		)
Balance at June 30, 2013	$	41,684		$	14,809		$	—	$	56,493

Capital expenditures for the Imaging, Radiation Oncology and Corporate segments were $3,468, $258, and $1,075, respectively, for the quarter ended June 30, 2013. Capital expenditures in the Imaging, Radiation Oncology and Corporate segments were $5,163, $771 and $231, respectively, for the quarter ended June 30, 2012. Capital expenditures for the Imaging, Radiation Oncology and Corporate segments were $5,481, $671, and $4,205, respectively, for the six months ended June 30, 2013. Capital expenditures in the Imaging, Radiation Oncology and Corporate segments were $6,803, $2,605 and $501, respectively, for the six months ended June 30, 2012.