Compuware Annual Report 2001

Compuware Corporation and Subsidiaries
Consolidated Financial Statements
Notes to Consolidated Financial Statements


10. SEGMENT INFORMATION

Compuware operates in two business segments in the software industry: products and services. The Company provides software products and professional services to IT organizations that help IT professionals efficiently develop, implement and support the applications that run their businesses.

The Company's products are designed to support four key activities within the application development process: development and integration, quality assurance, production readiness and performance management of the application to optimize performance in production.

The Company also offers a broad range of data processing professional services including business systems analysis, design and programming, software conversion and system planning and consulting.

The Company evaluates the performance of its segments based primarily on operating profit before corporate expenses and purchased research and development expense. The allocation of income taxes is not evaluated at the segment level.

No single customer provides more than 10% of the Company's revenue.

Financial information for the Company's business segments is as follows (in thousands):




YEAR ENDED MARCH 31,



2001   

2000   

1999   

Revenue:
   
   
   
   Products:
   
   
   
      Mainframe
$   762,778   
$ 1,031,273   
$   830,256   
      Distributed systems
189,328   
220,681   
187,469   



         Total products revenue
952,106   
1,251,954   
1,017,725   
   Services
1,057,944   
978,674   
620,720   



Total revenue
$ 2,010,050   
$ 2,230,628   
$ 1,638,445   









   
   
   
   
Operating Expenses:
   
   
   
   Products
$   646,963   
$   624,299   
$   548,359   
   Services
1,039,237   
946,710   
506,765   
   Corporate staff
89,916   
65,134   
73,476   
   Goodwill amortization
41,302   
25,252   
4,857   



Total operating expenses
$ 1,817,418   
$ 1,661,395   
$ 1,133,457   










Income from operations, before other income
(expense) and purchased research and
development charges:
   
   
   
   Products
$   305,143   
$   627,655   
$   469,366   
   Services
18,707   
31,964   
113,955   
   Corporate staff
(89,916)  
(65,134)  
(73,476)  
   Goodwill amortization
(41,302)  
(25,252)  
(4,857)  



Income from operations, before other income
(expense) and purchased research and

   
   
   
development charges:
192,632   
569,233   
504,988   
   Purchased research and development charges
   
(17,900)  
(4,350)  
   Other income (expense)
(563)  
10,443   
29,403   



Income before income taxes
$   192,069   
$   561,776   
$   530,041   












Financial information regarding geographic operations are presented in the table below (in thousands):




YEAR ENDED MARCH 31,



2001   

2000   

1999   

Revenue:
   
   
   
   United States
$  1,560,798   
$ 1,736,511   
$  1,202,266   
   Europe
323,882   
351,427   
316,393   
   Other international operations
125,370   
142,690   
119,786   



Total revenue
$  2,010,050   
$  2,230,628   
$  1,638,445   












The Company does not evaluate assets and capital expenditures on a segment basis, and accordingly such information is not provided. Less than 10% of the Company's long lived assets, other than financial instruments, are located outside of the United Slates.