Segment Reporting

3 Months Ended

Mar. 31, 2015

Segment Reporting

Segment Reporting

(14) Segment Reporting

The Company is organized into four geographic operating segments through which the Company’s chief operating decision maker manages the Company’s business. The U.S., Canadian, European and Asia Pacific Operations segments provide the following categories of products and services:

· Electronic Brokerage — includes self-directed trading using algorithms, smart routing and matching through POSIT in cash equities (including single stocks and portfolio lists), futures and options

· Research, Sales and Trading — includes (a) differentiated, unbiased, data-driven equity research through the use of innovative data mining and analysis, as well as detailed analysis of energy plays, and (b) portfolio trading and high-touch trading desks providing execution expertise and trading ideas based on investment research

· Platforms — includes trade order and execution management software applications in addition to network connectivity

· Analytics — includes tools enabling portfolio managers and traders to improve pre-trade and real-time execution performance, portfolio construction and optimization decisions and securities valuation.

The accounting policies of the reportable segments are the same as those described in Note 2, Summary of Significant Accounting Policies, in our Annual Report on Form 10-K  for the year ended December 31, 2014 except for the change reported in Note 1, Organization and Basis of Presentation, and described below.  The Company allocates resources to, and evaluates the performance of, its reportable segments based on income or loss before income tax expense. Consistent with the Company’s resource allocation and operating performance evaluation approach, the effects of inter-segment activities are eliminated except in limited circumstances where certain technology related costs are allocated to a segment to support that segment’s revenue producing activities. Commissions and fees revenue for trade executions and commission share revenues are principally attributed to each segment based upon the location of execution of the related transaction. Recurring revenues are principally attributed based upon the location of the client using the respective service.

Effective in the first quarter of 2015, the Company is presenting its regional segment results excluding corporate activity. For this purpose, corporate activity includes investment income from all treasury activity as well as costs not associated with operating the businesses within the Company’s regional segments. These costs include, among others, (a) the costs of being a public company, such as certain staff costs, a portion of external audit fees, and reporting, filing and listing costs, (b) intangible asset amortization, (c) interest expense, (d) professional fees associated with our global transfer pricing structure and (e) foreign exchange gains or losses. Prior to this change in segment measure, corporate activity was included in the region where the income/expense was earned/incurred, which primarily was in the U.S. Operations segment. Prior period segment data has been restated to conform to the 2015 presentation.  Identifiable assets all relate to an operating segment and are not separately identified as corporate activity.

A summary of the segment financial information is as follows (dollars in thousands):

	U.S. Operations		Canadian Operations		European Operations		Asia Pacific Operations			Corporate			Consolidated Total
Three Months Ended March 31, 2015
Total revenues	$	80,454	$	18,913	$	36,605	$	13,522		$	233		$	149,727
Income before income tax expense	11,056		3,756		11,129		1,107			(4,708		)	22,340
Identifiable assets	1,098,740		78,782		281,637		70,292			—			1,529,451
Three Months Ended March 31, 2014
Total revenues	$	75,607	$	19,218	$	32,790	$	9,697		$	297		$	137,609
Income (loss) before income tax expense (benefit)	10,256		4,510		10,824		(1,818		)	(5,352		)	18,420
Identifiable assets	1,068,577		97,016		1,268,145		596,822			—			3,030,560

The table below details the total revenues for the categories of products and services provided by the Company (dollars in thousands):

	Three months ended March 31,
	2015		2014
Revenues:
Electronic Brokerage	$	80,454	$	72,884
Research, Sales and Trading	32,513		29,245
Platforms	25,073		23,733
Analytics	11,454		11,450
Corporate	233		297
Total Revenues	$	149,727	$	137,609