Segment Information
We prepare our financial reports and analyze our business results within our four operating segments: Resources, Transportation, CMS, and Financial Services. The Financial Services segment consists entirely of the legacy Markit business. We evaluate revenue performance at the segment level and also by transaction type. No single customer accounted for 10% or more of our total revenue for the three and nine months ended August 31, 2016 and 2015. There are no material inter-segment revenues for any period presented.
We evaluate segment operating performance at the Adjusted EBITDA level for each of our four segments. We define Adjusted EBITDA as net income before net interest, provision for income taxes, depreciation and amortization, stock-based compensation cost, restructuring charges, acquisition-related costs, exceptional litigation, net other gains and losses, pension mark-to-market and settlement expense, the impact of joint ventures and noncontrolling interests, and discontinued operations. Information about the operations of our four segments is set forth below (in millions).
| | | | | | | | | | | | | | | | | | Three months ended August 31, | | Nine months ended August 31, | | 2016 | | 2015 | | 2016 | | 2015 | Revenue | | | | | | | | Resources | $ | 210.4 |
| | $ | 217.8 |
| | $ | 647.4 |
| | $ | 670.1 |
| Transportation | 227.1 |
| | 193.4 |
| | 657.7 |
| | 559.3 |
| CMS | 130.2 |
| | 146.7 |
| | 399.0 |
| | 399.2 |
| Financial Services | 156.9 |
| | — |
| | 156.9 |
| | — |
| Total revenue | $ | 724.6 |
| | $ | 557.9 |
| | $ | 1,861.0 |
| | $ | 1,628.6 |
| | | | | | | | | Adjusted EBITDA | | | | | | | | Resources | $ | 94.4 |
| | $ | 91.0 |
| | $ | 275.4 |
| | $ | 266.4 |
| Transportation | 88.6 |
| | 72.4 |
| | 252.6 |
| | 204.0 |
| CMS | 33.3 |
| | 29.1 |
| | 91.6 |
| | 72.8 |
| Financial Services | 65.0 |
| | — |
| | 65.0 |
| | — |
| Shared services | (12.3 | ) | | (12.9 | ) | | (35.0 | ) | | (33.3 | ) | Total Adjusted EBITDA | $ | 269.0 |
| | $ | 179.6 |
| | $ | 649.6 |
| | $ | 509.9 |
| | | | | | | | | Reconciliation to the consolidated statements of operations: | | | | | | | | Interest income | 0.3 |
| | 0.3 |
| | 0.9 |
| | 0.6 |
| Interest expense | (36.5 | ) | | (18.2 | ) | | (92.0 | ) | | (52.6 | ) | Benefit (provision) for income taxes | 23.1 |
| | (16.3 | ) | | (0.7 | ) | | (36.7 | ) | Depreciation | (30.2 | ) | | (21.0 | ) | | (78.2 | ) | | (61.9 | ) | Amortization related to acquired intangible assets | (61.5 | ) | | (33.8 | ) | | (138.3 | ) | | (97.6 | ) | Stock-based compensation expense | (80.4 | ) | | (31.8 | ) | | (142.6 | ) | | (96.4 | ) | Restructuring charges | (10.6 | ) | | (1.9 | ) | | (23.9 | ) | | (22.0 | ) | Acquisition-related costs | (104.5 | ) | | (0.1 | ) | | (119.9 | ) | | (0.6 | ) | Impairment of assets | — |
| | — |
| | — |
| | (1.2 | ) | Share of joint venture results not attributable to Adjusted EBITDA | 0.3 |
| | — |
| | 0.3 |
| | — |
| Adjusted EBITDA attributable to noncontrolling interest | 0.3 |
| | — |
| | 0.3 |
| | — |
| Income (loss) from discontinued operations, net | (1.0 | ) | | 2.3 |
| | 8.0 |
| | 8.1 |
| Net income (loss) | $ | (31.7 | ) | | $ | 59.1 |
| | $ | 63.5 |
| | $ | 149.6 |
|
Revenue by transaction type was as follows (in millions): | | | | | | | | | | | | | | | | | | Three months ended August 31, | | Nine months ended August 31, | | 2016 | | 2015 | | 2016 | | 2015 | Recurring fixed revenue | $ | 548.0 |
| | $ | 449.4 |
| | $ | 1,453.2 |
| | $ | 1,320.3 |
| Recurring variable revenue | 56.8 |
| | — |
| | 56.8 |
| | — |
| Non-recurring revenue | 119.8 |
| | 108.5 |
| | 351.0 |
| | 308.3 |
| Total revenue | $ | 724.6 |
| | $ | 557.9 |
| | $ | 1,861.0 |
| | $ | 1,628.6 |
|
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