Vonage 2015 Annual Report Download - page 100

VONAGE HOLDINGS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(In thousands, except per share amounts)
F-40 VONAGE ANNUAL REPORT 2015
Pro forma financial information (unaudited)
The following unaudited supplemental pro forma information presents the combined historical results of operations of Vonage, Simple
Signal, and iCore for the years 2015 and 2014, as if the Acquisitions had been completed at the beginning of 2014.
For the years ended December 31,
2015 2014
Revenue $ 943,554 $ 942,882
Net income attributable to Vonage 20,653 14,036
Net income attributable to Vonage per share - basic 0.10 0.07
Net income attributable to Vonage per share - diluted 0.09 0.06
The pro forma financial information includes certain
adjustments to reflect expenses in the appropriate pro forma periods as
though the companies were combined as of the beginning of 2014.
These adjustments include:
>an increase in amortization expense of $3,970 and
$7,666 for the year ended 2015 and 2014,
respectively, related to the identified intangible assets
of Simple Signal and iCore;
>a decrease in income tax expense of $1,511 and
$1,888 for the year ended 2015 and 2014,
respectively, related to pro forma adjustments and
Simple Signal and iCore's results prior to acquisition;
>the exclusion of our transaction-related expenses of
$2,610 for the year ended 2015;
>an increase in interest expense of $1,790 and $3,060
for the years ended 2015 and 2014, respectively
associated with borrowings under our revolving credit
facility.
The Company recorded revenue of $34,243 and net loss of
$2,385 attributable to iCore and Simple Signal for the year ended
December 31, 2015.
Note 12. Noncontrolling Interest and Redeemable
Noncontrolling Interest
In the third quarter of 2013, we formed a consolidated foreign
subsidiary in Brazil in connection with our previously announced joint
venture in Brazil, which created a redeemable noncontrolling interest.
The redeemable noncontrolling interest consists of the 30.0% interest
in this subsidiary held by our joint venture partner.
In 2014, our joint venture partner did not make required capital
calls and correspondingly its interest was diluted to 4% and was no
longer contingently redeemable. As such, we reclassified the
redeemable noncontrolling interest previously included in the
mezzanine section of our Consolidated Balance Sheets to
noncontrolling interest in the Stockholders' Equity section of our
Consolidated Balance Sheets.
In December 2014 we announced plans to exit the Brazilian
market for consumer telephony services and wind down our joint venture
operations in the country. We completed the process at the end of the
first quarter of 2015.
We expect to avoid material operating losses in Brazil in 2016
due to the significant planned incremental investment that would have
been required to scale the business. In connection with the wind down,
we incurred approximately $111 and $1,972 in cash and non-cash
charges, respectively, in the fourth quarter of 2014 related to severance-
related expenses and asset write downs. We incurred approximately
$500 in cash charges in 2015 related to contract terminations and
severance-related expenses.
Note 13. Discontinued Operations
On March 31, 2015, the Company completed its previously
announced exit from the Brazilian market for consumer telephony
services and the associated wind down of its joint venture operations
in the country. The Company incurred a loss on disposal of $824. The
loss on disposal is comprised of the write-off of noncontrolling interest
of $907, foreign currency loss on intercompany loan forgiveness of
$783, and residual cumulative translation of $192, partially offset by
a tax benefit of $1,058.