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General and Administrative Expense:
2013 vs. 2012
2012 vs. 2011
($ in millions)
2013
2012
$
%
2011
$
%
General and administrative expense........................... $ 54.7 $ 54.3 $ 0.4
1% $ 46.2 $ 8.1 18%
Percent of revenue .....................................................
15%
11%
11%
General and administrative (“G&A”) expense primarily represents management, finance, legal (including intellectual property
management), human resources and internal information system functions. These costs include compensation, benefits, professional
fees, travel, and a proportionate share of rent, utilities and other facilities costs which are expensed as incurred. G&A expenses in
2013 increased slightly over 2012 mainly due to an increase in G&A expenses related to our intellectual property monetization efforts
and higher spending on the security and operations of internal data networks, offsetting cost reductions and the absence of non-
recurring 2012 microDATA acquisition expenses. G&A expenses increased $8.1 million, or 18% in 2012 over 2011 mainly due to
legal and professional costs associated with the protection and monetization of intellectual property, accruals for variable
compensation, incremental overhead and other operating costs, and transaction expenses associated with the microDATA acquisition.
Depreciation and Amortization of Property and Equipment:
2013 vs. 2012
2012 vs. 2011
($ in millions)
2013
2012
$
%
2011
$
%
Depreciation and amortization of property and
equipment............................................................... $ 14.9 $ 14.2 $ 0.7
5% $ 12.1 $ 2.1 17%
Average gross cost of property and equipment ........... $ 111.4 $ 117.3 $ (5.9) (5%) $ 104.6 $ 12.7 12%
Depreciation and amortization of property and equipment represents the period costs associated with our investment in
information technology and telecommunications equipment, software, furniture and fixtures, and leasehold improvements, as well as
amortization of capitalized software developed for internal use, including hosted applications. We compute depreciation and
amortization using the straight-line method over the estimated useful lives of the assets, generally five years for furniture, fixtures, and
leasehold improvements, and three to seven years for other types of assets including computers, software, and telephone equipment.
Depreciation expense has increased year-over-year as a result of cumulative capital expenditures made over time. Our depreciable
asset base decreased in 2013 as a result of a $12.6 million write-down. Our depreciable asset base increased $12.7 million, or 12% in
2012 primarily as a result of about $23 million of capital spending, and the microDATA purchase, offset by the 2012 $13 million
write-down related to our Navigation report unit.
Amortization of Acquired Intangible Assets:
2013 vs. 2012
2012 vs. 2011
($ in millions)
2013
2012
$
%
2011
$
%
Amortization of acquired intangible assets ................. $
4.6 $ 4.4 $ 0.2
5% $ 5.5
$ (1.1) (20)%
Acquired intangible assets are being amortized over estimated useful lives of between four and nineteen years. Amortization of
acquired intangibles increased $0.2 million, or 5% in 2013 compared to 2012 and decreased $1.1 million, or 20% in 2012 from 2011
as a result of the lower asset basis following the 2012 write-down of Navigation reporting unit intangibles, partly offset by additional
amortization resulting from the 2012 acquisition of microDATA.
Impairment of goodwill and long-lived assets:
2013 vs. 2012
2012 vs. 2011
($ in millions)
2013
2012
$
%
2011
$
%
Impairment of goodwill and long-lived assets ............ $ 32.0 $ 125.7 $ (93.7) (75
%
) $
—
125.7 100%
In 2013, we recorded a $32.0 million impairment charge for the excess of the carrying value over the estimated fair value of our
Platforms and Applications reporting unit’s goodwill and long-lived assets. In 2012, we recorded a $125.7 million impairment charge
for the excess of the carrying value over the estimated fair value of our Navigation reporting unit’s goodwill and other long-lived
assets. No impairment charges were recorded in 2011.
