Redbox 2006 Annual Report Download - page 70

COINSTAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
YEARS ENDED DECEMBER 31, 2006, 2005, AND 2004
We also maintain a 401(k) profit sharing plan, which covers substantially all of the employees of our
entertainment services subsidiaries. Employees are permitted to contribute up to 15% of their eligible
compensation. We make contributions to the plan matching 50% of the employees’ contribution up to 10% of
their compensation. Matching contributions were $685,000 and $611,000 for the years ended December 31, 2006
and 2005, respectively, and $349,000 for the period July 7, 2004 (acquisition date) through December 31, 2004.
NOTE 13: TERMINATION OF SUPPLIER RELATIONSHIP
Through April 1999, Scan Coin AB of Malmo, Sweden, was our sole source provider of our coin-counting
devices. Coinstar and Scan Coin have been in a contract dispute since September 1998, at which time Scan Coin
claimed that we had breached the contract and made claims to certain of our intellectual property. On May 5,
1999, Scan Coin terminated its agreement with us and reasserted the breach of contract claim and the claim to
certain of our intellectual property. The parties have been working to settle the dispute amicably since that time.
There is no assurance, however, that the disagreement will be settled amicably, and litigation may commence.
NOTE 14: BUSINESS SEGMENT INFORMATION
FASB Statement No. 131, Disclosure about Segments of an Enterprise and Related Information, requires
that companies report separately in the financial statements certain financial and descriptive information about
operating segments profit or loss, certain specific revenue and expense items and segment assets. The method for
determining what information is reported is based on the way that management organizes the operating segments
for making operational decisions and assessments of financial performance. Our chief operating decision maker
is considered to be the Chief Executive Officer (“CEO”). We are organized into two reportable business
segments: the North American business (which includes the United States, Canada and Mexico), and our
International business (which primarily includes the United Kingdom as well as other European operations of
CMT). The total revenue of the North American segment mainly relates to operations located within the United
States, and the total revenue of the International segment mainly relates to the operations located within the
United Kingdom. Goodwill from the acquisition of CMT has been included in the International business
segment. Goodwill arising in all other acquisitions has been allocated to our North American business segment.
Year ended December 31,
2006 2005 2004
(in thousands)
Revenue:
North American ............................................. $500,462 $438,482 $289,485
International ................................................ 33,980 21,257 17,615
Total revenue ........................................... $534,442 $459,739 $307,100
Net income (loss):
North American business ...................................... $ 22,935 $ 22,402 $ 17,311
International business ......................................... (4,308) (130) 3,057
Total net income ......................................... $ 18,627 $ 22,272 $ 20,368
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