Travelzoo 2007 Annual Report Download - page 84

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The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference
between the Company’s closing stock price on the last trading day of fiscal year 2007 and the exercise price,
multiplied by the number of in-the-money options) that would have been received by the option holders had all
option holders exercised their options on December 31, 2007. This amount changes based on the fair market value
of the Company’s stock. The Company’s policy is to issue shares from the authorized shares to fulfill stock option
exercises.
Exercise Price
Shares
Outstanding and
Exercisable
Weighted-Average
Remaining
Contractual Life
Weighted-Average
Exercise Price
$1.00 ............................... 2,158,349 3.09 years $1.00
$2.00 ............................... 42,725 3.83 years 2.00
$3.00 ............................... 10,000 4.25 years 3.00
2,211,074 3.11 years $1.03
(7) Segment Reporting and Significant Customer Information
The Company manages its business geographically and has three operating segments: North America, Europe,
and Asia Pacific. North America consists of the Company’s operations in Canada and the U.S. Europe consists of
the Company’s operations in France, Germany, Spain, and the U.K. Asia Pacific consists of the Company’s
operations in Australia, China, Hong Kong, Japan, and Taiwan. The Company began operations in Europe in May
2005 and began operations in Asia Pacific in April 2007.
Management relies on an internal management reporting process that provides revenue and segment operating
income (loss) for making financial decisions and allocating resources. Management believes that segment revenues
and operating income (loss) are appropriate measures of evaluating the operational performance of the Company’s
segments.
The following is a summary of operating results and assets (in thousands) by business segment:
Year Ended December 31, 2007: North America Europe Asia Pacific Elimination Consolidated
Revenues from unaffiliated
customers................ $73,061 $ 5,842 $ 8 $ — $78,911
Intersegment revenues ........ 171 14 — (185) —
Total net revenues ........... 73,232 5,856 8 (185) 78,911
Operating income (loss) ....... 28,959 (5,172) (3,166) 3 20,624
Year Ended December 31, 2006: North America Europe Asia Pacific Elimination Consolidated
Revenues from unaffiliated
customers................ $66,303 $ 3,222 $— $ — $69,525
Intersegment revenues ........ 206 10 — (216) —
Total net revenues ........... 66,509 3,232 — (216) 69,525
Operating income (loss) ....... 31,337 (1,586) — 2 29,753
As of December 31, 2007 North America Europe Asia Pacific Elimination Consolidated
Property and equipment,
net: .................. $ 383 $ 70 $ 169 $ — $ 622
Total assets . . ............ 45,801 3,525 2,094 (14,134) 37,286
52
TRAVELZOO INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)