Classmates.com 2007 Annual Report Download - page 48

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Information for our two reportable operating segments was as follows (in thousands):
A reconciliation of segment income from operations (which excludes depreciation and amortization of intangible assets) to consolidated
operating income, is as follows for each period presented (in thousands):
Communications segment income from operations for the year ended December 31, 2007 included restructuring charges of $3.4 million.
Classmates Media segment income from operations for the year ended December 31, 2007 was impacted by expenses of $3.6 million in
connection with the proposed IPO of our CMC subsidiary.
Communications segment income from operations for the year ended December 31, 2006 included restructuring charges of $0.6 million and
impairment charges of $13.3 million.
Year Ended December 31, 2007 compared to Year Ended December 31, 2006
Revenues
Billable Services Revenues
Billable services revenues are comprised of amounts charged to pay accounts for our billable services. Classmates Media billable services
revenues consist of amounts charged to pay accounts for social networking services. Communications billable services revenues consist of
amounts charged to pay accounts for Internet access, email, Web hosting, Internet security, and other services, with
46
Classmates Media
Communications
Year Ended December 31,
Year Ended December 31,
2007
2006
2005
2007
2006
2005
Billable services
$
106,514
$
81,146
$
63,550
$
273,012
$
342,419
$
402,430
Advertising
86,905
58,300
21,342
47,072
40,789
37,739
Total revenues
193,419
139,446
84,892
320,084
383,208
440,169
Operating expenses:
Cost of revenues
39,497
26,939
10,518
69,254
83,509
91,426
Sales and marketing
78,918
60,743
43,182
84,094
115,955
165,891
Product development
16,016
10,481
5,615
29,613
37,422
31,315
General and administrative
30,769
21,345
15,178
36,672
39,399
38,096
Restructuring charges
42
—
—
3,377
627
—
Impairment of goodwill, intangible assets and
long
-
lived assets
—
—
—
—
13,285
—
Total operating expenses
165,242
119,508
74,493
223,010
290,197
326,728
Segment income from operations
$
28,177
$
19,938
$
10,399
$
97,074
$
93,011
$
113,441
Year Ended December 31,
2007
2006
2005
Segment income from operations:
Classmates Media
$
28,177
$
19,938
$
10,399
Communications
97,074
93,011
113,441
Total segment income from operations
125,251
112,949
123,840
Depreciation
(20,150
)
(21,290
)
(15,481
)
Amortization of intangible assets
(12,800
)
(17,640
)
(21,799
)
Consolidated operating income
$
92,301
$
74,019
$
86,560