Segment Information

6 Months Ended

Mar. 31, 2012

Segment Information

8. Segment Information

The Company reports financial results in four segments: Brooks Product Solutions, Brooks Global Services, Brooks Life Science Systems and Contract Manufacturing. A description of segments is included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2011.

The Company evaluates performance and allocates resources based on revenues, operating income (loss) and returns on invested assets. Operating income (loss) for each segment includes selling, general and administrative expenses directly attributable to the segment. Intersegment revenues between Brooks Product Solutions and Contract Manufacturing were eliminated from Contract Manufacturing revenues. The profits reported on intercompany transactions are based on the transfer prices charged which approximates fair value to third parties. Other unallocated corporate expenses (primarily certain legal costs associated with the Company’s past equity incentive-related practices and costs to indemnify a former executive in connection with these matters), amortization of acquired intangible assets (excluding completed technology) and restructuring are excluded from the segments’ operating income (loss). The Company’s non-allocable overhead costs, which include various general and administrative expenses, are allocated among the segments based upon various cost drivers associated with the respective administrative function, including segment revenues, segment headcount, or an analysis of the segments that benefit from a specific administrative function. Segment assets exclude investments in joint ventures, marketable securities and cash equivalents.

Financial information for the Company’s business segments is as follows (in thousands):

	Brooks Product Solutions		Brooks Global Services		Brooks Life Science Systems			Contract Manufacturing		Total
Three months ended March 31, 2012
Revenues
Product	$	103,456	$	3,015	$	11,150		$	—	$	117,621
Services		—		18,220		3,496			—		21,716
	$	103,456	$	21,235	$	14,646		$	—	$	139,337
Gross profit	$	35,885	$	6,591	$	5,806		$	—	$	48,282
Segment operating income	$	7,597	$	2,195	$	(105	)	$	—	$	9,687
Three months ended March 31, 2011
Revenues
Product	$	121,664	$	4,149	$	—		$	49,123	$	174,936
Services		—		17,715		—			—		17,715
	$	121,664	$	21,864	$	—		$	49,123	$	192,651
Gross profit	$	47,490	$	7,920	$	—		$	6,264	$	61,674
Segment operating income	$	20,677	$	3,062	$	—		$	4,000	$	27,739
Six months ended March 31, 2012
Revenues
Product	$	188,750	$	5,392	$	20,577		$	—	$	214,719
Services		—		37,937		6,909			—		44,846
	$	188,750	$	43,329	$	27,486		$	—	$	259,565
Gross profit	$	64,286	$	13,727	$	10,626		$	—	$	88,639
Segment operating income	$	8,682	$	5,144	$	(738	)	$	—	$	13,088
Six months ended March 31, 2011
Revenues
Product	$	233,665	$	7,447	$	—		$	95,013	$	336,125
Services		—		34,893		—			—		34,893
	$	233,665	$	42,340	$	—		$	95,013	$	371,018
Gross profit	$	90,580	$	15,187	$	—		$	13,226	$	118,993
Segment operating income	$	38,148	$	5,572	$	—		$	8,643	$	52,363
Assets
March 31, 2012	$	225,588	$	57,192	$	109,314		$	—	$	392,094
September 30, 2011	$	235,322	$	52,354	$	101,331		$	—	$	389,007

Revenues for the Brooks Product Solutions segment for the three months and six months ended March 31, 2011 include intercompany sales of $16.5 million and $33.0 million, respectively, from this segment to the Contract Manufacturing segment. These intercompany revenues have been eliminated from the revenues of Contract Manufacturing.

Revenues for the Contract Manufacturing segment for the three months and six months ended March 31, 2011 exclude intercompany sales of $4.1 million and $7.9 million, respectively, from this segment to the Brooks Product Solutions segment.

A reconciliation of the Company’s reportable segment operating income to the corresponding consolidated amounts for the three and six month periods ended March 31, 2012 and 2011 is as follows (in thousands):

	Three months ended March 31,					Six months ended March 31,
	2012			2011		2012			2011
Segment operating income	$	9,687		$	27,739	$	13,088		$	52,363
Other unallocated corporate expenses		(2,934	)		303		(2,416	)		534
Amortization of acquired intangible assets		1,138			449		2,355			899
Restructuring charges		42			246		245			460
In-process research and development		3,026			—		3,026			—
Total operating income	$	8,415		$	26,741	$	9,878		$	50,470

A reconciliation of the Company’s reportable segment assets to the corresponding consolidated amounts as of March 31, 2012 and September 30, 2011 is as follows (in thousands):

	March 31, 2012		September 30, 2011
Segment assets	$	392,094	$	389,007
Investments in cash equivalents, marketable securities, joint ventures, and other unallocated corporate net assets		244,582		247,613
Total assets	$	636,676	$	636,620