Segment Information | 6 Months Ended |
Jun. 30, 2014 |
Segment Reporting [Abstract] | ' |
Segment Information | ' |
3 | Segment Information | | | | | | | | | | | | | | | |
The Company is organized into two separately managed segments: the Reis Services segment and the discontinued Residential Development Activities segment. The following tables present condensed balance sheet and operating data for these segments: |
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(amounts in thousands) | | | | | | | | | | | | |
Condensed Balance Sheet Data June 30, 2014 | | Reis | | | Discontinued | | | Other (B) | | | Consolidated | |
Services | Operations (A) |
Assets | | | | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | $ | 16,241 | | | $ | — | | | $ | 162 | | | $ | 16,403 | |
Restricted cash and investments | | | 212 | | | | — | | | | — | | | | 212 | |
Accounts receivable, net | | | 4,469 | | | | — | | | | — | | | | 4,469 | |
Prepaid and other assets | | | 225 | | | | — | | | | 2,237 | | | | 2,462 | |
Assets attributable to discontinued operations | | | — | | | | — | | | | 5 | | | | 5 | |
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Total current assets | | | 21,147 | | | | — | | | | 2,404 | | | | 23,551 | |
Furniture, fixtures and equipment, net | | | 831 | | | | — | | | | 20 | | | | 851 | |
Intangible assets, net | | | 15,375 | | | | — | | | | — | | | | 15,375 | |
Deferred tax asset, net | | | 285 | | | | — | | | | 20,545 | | | | 20,830 | |
Goodwill | | | 57,203 | | | | — | | | | (2,378 | ) | | | 54,825 | |
Other assets | | | 183 | | | | — | | | | — | | | | 183 | |
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Total assets | | $ | 95,024 | | | $ | — | | | $ | 20,591 | | | $ | 115,615 | |
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Liabilities and stockholders’ equity | | | | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | | | | |
Current portion of debt | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
Accrued expenses and other liabilities | | | 2,278 | | | | — | | | | 692 | | | | 2,970 | |
Liability for option cancellations | | | — | | | | — | | | | 151 | | | | 151 | |
Deferred revenue | | | 17,693 | | | | — | | | | — | | | | 17,693 | |
Liabilities attributable to discontinued operations | | | — | | | | 271 | | | | 40 | | | | 311 | |
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Total current liabilities | | | 19,971 | | | | 271 | | | | 883 | | | | 21,125 | |
Other long-term liabilities | | | 500 | | | | — | | | | — | | | | 500 | |
Deferred tax liability, net | | | 21,098 | | | | — | | | | (21,098 | ) | | | — | |
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Total liabilities | | | 41,569 | | | | 271 | | | | (20,215 | ) | | | 21,625 | |
Total stockholders’ equity | | | 53,455 | | | | (271 | ) | | | 40,806 | | | | 93,990 | |
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Total liabilities and stockholders’ equity | | $ | 95,024 | | | $ | — | | | $ | 20,591 | | | $ | 115,615 | |
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(A) | Includes the assets and liabilities of the Company’s discontinued Residential Development Activities segment, to the extent that such assets and liabilities existed at the date presented. | | | | | | | | | | | | | | | |
(B) | Includes cash, other assets and liabilities not specifically attributable to or allocable to a specific operating segment. | | | | | | | | | | | | | | | |
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(amounts in thousands) | | | | | | | | | | | | |
Condensed Balance Sheet Data December 31, 2013 | | Reis | | | Discontinued | | | Other (B) | | | Consolidated | |
Services | Operations (A) |
Assets | | | | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | | | | |
Cash and cash equivalents | | $ | 10,347 | | | $ | — | | | $ | 213 | | | $ | 10,560 | |
Restricted cash and investments | | | 217 | | | | — | | | | — | | | | 217 | |
Accounts receivable, net | | | 11,386 | | | | — | | | | — | | | | 11,386 | |
Prepaid and other assets | | | 187 | | | | — | | | | 2,601 | | | | 2,788 | |
Assets attributable to discontinued operations | | | — | | | | — | | | | 9 | | | | 9 | |
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Total current assets | | | 22,137 | | | | — | | | | 2,823 | | | | 24,960 | |
Furniture, fixtures and equipment, net | | | 829 | | | | — | | | | 24 | | | | 853 | |
Intangible assets, net | | | 15,687 | | | | — | | | | — | | | | 15,687 | |
Deferred tax asset, net | | | 285 | | | | — | | | | 21,032 | | | | 21,317 | |
Goodwill | | | 57,203 | | | | — | | | | (2,378 | ) | | | 54,825 | |
Other assets | | | 225 | | | | — | | | | — | | | | 225 | |
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Total assets | | $ | 96,366 | | | $ | — | | | $ | 21,501 | | | $ | 117,867 | |
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Liabilities and stockholders’ equity | | | | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | | | | |
Current portion of debt | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
Accrued expenses and other liabilities | | | 2,623 | | | | — | | | | 956 | | | | 3,579 | |
Liability for option cancellations | | | — | | | | — | | | | 268 | | | | 268 | |
Deferred revenue | | | 20,284 | | | | — | | | | — | | | | 20,284 | |
Liabilities attributable to discontinued operations | | | — | | | | 271 | | | | 71 | | | | 342 | |
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Total current liabilities | | | 22,907 | | | | 271 | | | | 1,295 | | | | 24,473 | |
Other long-term liabilities | | | 523 | | | | — | | | | — | | | | 523 | |
Deferred tax liability, net | | | 18,957 | | | | — | | | | (18,957 | ) | | | — | |
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Total liabilities | | | 42,387 | | | | 271 | | | | (17,662 | ) | | | 24,996 | |
Total stockholders’ equity | | | 53,979 | | | | (271 | ) | | | 39,163 | | | | 92,871 | |
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Total liabilities and stockholders’ equity | | $ | 96,366 | | | $ | — | | | $ | 21,501 | | | $ | 117,867 | |
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(A) | Includes the assets and liabilities of the Company’s discontinued Residential Development Activities segment, to the extent that such assets and liabilities existed at the date presented. | | | | | | | | | | | | | | | |
(B) | Includes cash, other assets and liabilities not specifically attributable to or allocable to a specific operating segment. | | | | | | | | | | | | | | | |
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(amounts in thousands) | | | | | | | | | | | | |
Condensed Operating Data for the Three Months Ended June 30, 2014 | | Reis | | | Discontinued | | | Other (B) | | | Consolidated | |
Services | Operations (A) |
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Subscription revenue | | $ | 10,194 | | | $ | — | | | $ | — | | | $ | 10,194 | |
Cost of sales of subscription revenue | | | 1,974 | | | | — | | | | — | | | | 1,974 | |
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Gross profit | | | 8,220 | | | | — | | | | — | | | | 8,220 | |
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Operating expenses: | | | | | | | | | | | | | | | | |
Sales and marketing | | | 2,541 | | | | — | | | | — | | | | 2,541 | |
Product development | | | 814 | | | | — | | | | — | | | | 814 | |
General and administrative expenses | | | 2,079 | | | | — | | | | 1,123 | | | | 3,202 | |
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Total operating expenses | | | 5,434 | | | | — | | | | 1,123 | | | | 6,557 | |
Other income (expenses): | | | | | | | | | | | | | | | | |
Interest and other income | | | 6 | | | | — | | | | — | | | | 6 | |
Interest expense | | | (28 | ) | | | — | | | | — | | | | (28 | ) |
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Total other income (expenses) | | | (22 | ) | | | — | | | | — | | | | (22 | ) |
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Income (loss) before income taxes and discontinued operations | | $ | 2,764 | | | $ | — | | | $ | (1,123 | ) | | $ | 1,641 | |
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(Loss) from discontinued operations, before income taxes | | $ | — | | | $ | — | | | $ | (175 | ) | | $ | (175 | ) |
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Condensed Operating Data for the Three Months Ended June 30, 2013 | | Reis | | | Discontinued | | | Other (B) | | | Consolidated | |
Services | Operations (A) |
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Subscription revenue | | $ | 8,498 | | | $ | — | | | $ | — | | | $ | 8,498 | |
Cost of sales of subscription revenue | | | 1,675 | | | | — | | | | — | | | | 1,675 | |
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Gross profit | | | 6,823 | | | | — | | | | — | | | | 6,823 | |
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Operating expenses: | | | | | | | | | | | | | | | | |
Sales and marketing | | | 2,032 | | | | — | | | | — | | | | 2,032 | |
Product development | | | 791 | | | | — | | | | — | | | | 791 | |
General and administrative expenses | | | 1,723 | | | | — | | | | 1,382 | | | | 3,105 | |
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Total operating expenses | | | 4,546 | | | | — | | | | 1,382 | | | | 5,928 | |
Other income (expenses): | | | | | | | | | | | | | | | | |
Interest and other income | | | 2 | | | | — | | | | — | | | | 2 | |
Interest expense | | | (28 | ) | | | — | | | | — | | | | (28 | ) |
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Total other income (expenses) | | | (26 | ) | | | — | | | | — | | | | (26 | ) |
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Income (loss) before income taxes and discontinued operations | | $ | 2,251 | | | $ | — | | | $ | (1,382 | ) | | $ | 869 | |
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(Loss) from discontinued operations, before income taxes | | $ | — | | | $ | — | | | $ | (62 | ) | | $ | (62 | ) |
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(A) | Includes the results of the Company’s discontinued Residential Development Activities segment, to the extent that such operations existed during the periods presented. | | | | | | | | | | | | | | | |
(B) | Includes interest and other income, depreciation expense and general and administrative expenses that have not been allocated to the operating segments. | | | | | | | | | | | | | | | |
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(amounts in thousands) | | | | | | | | | | | | |
Condensed Operating Data for the Six Months Ended June 30, 2014 | | Reis | | | Discontinued | | | Other (B) | | | Consolidated | |
Services | Operations (A) |
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Subscription revenue | | $ | 20,140 | | | $ | — | | | $ | — | | | $ | 20,140 | |
Cost of sales of subscription revenue | | | 3,890 | | | | — | | | | — | | | | 3,890 | |
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Gross profit | | | 16,250 | | | | — | | | | — | | | | 16,250 | |
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Operating expenses: | | | | | | | | | | | | | | | | |
Sales and marketing | | | 5,093 | | | | — | | | | — | | | | 5,093 | |
Product development | | | 1,577 | | | | — | | | | — | | | | 1,577 | |
General and administrative expenses | | | 3,971 | | | | — | | | | 2,269 | | | | 6,240 | |
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Total operating expenses | | | 10,641 | | | | — | | | | 2,269 | | | | 12,910 | |
Other income (expenses): | | | | | | | | | | | | | | | | |
Interest and other income | | | 9 | | | | — | | | | — | | | | 9 | |
Interest expense | | | (56 | ) | | | — | | | | — | | | | (56 | ) |
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Total other income (expenses) | | | (47 | ) | | | — | | | | — | | | | (47 | ) |
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Income (loss) before income taxes and discontinued operations | | $ | 5,562 | | | $ | — | | | $ | (2,269 | ) | | $ | 3,293 | |
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(Loss) from discontinued operations, before income taxes | | $ | — | | | $ | (28 | ) | | $ | (760 | ) | | $ | (788 | ) |
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Condensed Operating Data for the Six Months Ended June 30, 2013 | | Reis | | | Discontinued | | | Other (B) | | | Consolidated | |
Services | Operations (A) |
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Subscription revenue | | $ | 16,732 | | | $ | — | | | $ | — | | | $ | 16,732 | |
Cost of sales of subscription revenue | | | 3,356 | | | | — | | | | — | | | | 3,356 | |
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Gross profit | | | 13,376 | | | | — | | | | — | | | | 13,376 | |
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Operating expenses: | | | | | | | | | | | | | | | | |
Sales and marketing | | | 4,001 | | | | — | | | | — | | | | 4,001 | |
Product development | | | 1,513 | | | | — | | | | — | | | | 1,513 | |
General and administrative expenses | | | 3,519 | | | | — | | | | 2,755 | | | | 6,274 | |
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Total operating expenses | | | 9,033 | | | | — | | | | 2,755 | | | | 11,788 | |
Other income (expenses): | | | | | | | | | | | | | | | | |
Interest and other income | | | 4 | | | | — | | | | — | | | | 4 | |
Interest expense | | | (56 | ) | | | — | | | | — | | | | (56 | ) |
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Total other income (expenses) | | | (52 | ) | | | — | | | | — | | | | (52 | ) |
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Income (loss) before income taxes and discontinued operations | | $ | 4,291 | | | $ | — | | | $ | (2,755 | ) | | $ | 1,536 | |
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(Loss) from discontinued operations, before income taxes | | $ | — | | | $ | — | | | $ | (313 | ) | | $ | (313 | ) |
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(A) | Includes the results of the Company’s discontinued Residential Development Activities segment, to the extent that such operations existed during the periods presented. | | | | | | | | | | | | | | | |
(B) | Includes interest and other income, depreciation expense and general and administrative expenses that have not been allocated to the operating segments. | | | | | | | | | | | | | | | |
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Reis Services |
See Note 1 for a description of Reis Services’s business and products at June 30, 2014. |
The Company’s largest individual subscriber accounted for 3.0% and 3.6% of Reis Services’s revenue for the six months ended June 30, 2014 and 2013, respectively. |
The balance of outstanding accounts receivables of Reis Services at June 30, 2014 and December 31, 2013 follows: |
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| | June 30, | | | December 31, | | | | | | | | | |
2014 | 2013 | | | | | | | | |
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Accounts receivables | | $ | 4,546,000 | | | $ | 11,465,000 | | | | | | | | | |
Allowance for doubtful accounts | | | (77,000 | ) | | | (79,000 | ) | | | | | | | | |
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Accounts receivables, net | | $ | 4,469,000 | | | $ | 11,386,000 | | | | | | | | | |
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Five subscribers accounted for an aggregate of approximately 30.1% of Reis Services’s accounts receivable at June 30, 2014, with the largest representing 16.5%. Through July 28, 2014, the Company received payments of approximately $2,189,000 or 48.1% against the June 30, 2014 accounts receivable balance. |
At June 30, 2014, the largest individual subscriber accounted for 4.0% of deferred revenue. |
Discontinued Operations – Residential Development Activities |
(Loss) from discontinued operations is comprised of the following: |
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| | For the Three Months Ended | | | For the Six Months Ended | |
June 30, | June 30, |
| | 2014 | | | 2013 | | | 2014 | | | 2013 | |
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Litigation recoveries (see Note 11) | | $ | 16,000 | | | $ | 80,000 | | | $ | 16,000 | | | $ | 80,000 | |
Other income (expense), net | | | (191,000 | ) | | | (142,000 | ) | | | (804,000 | ) | | | (393,000 | ) |
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(Loss) from discontinued operations before income tax | | | (175,000 | ) | | | (62,000 | ) | | | (788,000 | ) | | | (313,000 | ) |
Income tax (benefit) from discontinued operations | | | (82,000 | ) | | | (24,000 | ) | | | (317,000 | ) | | | (123,000 | ) |
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(Loss) from discontinued operations, net of income tax (benefit) | | $ | (93,000 | ) | | $ | (38,000 | ) | | $ | (471,000 | ) | | $ | (190,000 | ) |
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In September 2009, the Company sold the final unit at Gold Peak, the final phase of Palomino Park, a five phase multifamily residential development in Highlands Ranch, Colorado. Gold Peak was a 259 unit condominium project on the remaining 29 acre land parcel at Palomino Park. On March 13, 2012, in connection with litigation regarding construction defects at the Gold Peak project, a jury rendered its verdict, whereby Reis, one of its subsidiaries (Gold Peak at Palomino Park LLC, the developer of the project (“GP LLC”)), and the construction manager/general contractor for the project (Tri-Star Construction West, LLC (“Tri-Star”)) were found jointly and severally liable for an aggregate of $18,200,000, plus other costs of approximately $756,000. On June 20, 2012, following denial of all of the defendants’ post-trial motions, Reis and its subsidiaries reached a settlement with the plaintiff, the Gold Peak homeowners association, providing for a total payment of $17,000,000. Of this amount, $5,000,000 was paid on August 3, 2012 and the remaining $12,000,000 was paid on October 15, 2012, in accordance with the settlement terms. During the three and six months ended June 30, 2014 and 2013, the Company’s efforts resulted in cash recoveries of $16,000, $80,000, $16,000 and $80,000, respectively. For additional information pertaining to the Gold Peak litigation, see Note 11. |