Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 02, 2016 | Jun. 30, 2015 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | EGOV | ||
Entity Registrant Name | NIC INC | ||
Entity Central Index Key | 1,065,332 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 65,652,223 | ||
Entity Public Float | $ 1,126,290,996 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash | $ 98,388,249 | $ 87,983,398 |
Cash restricted for payment of dividend | 36,455,955 | |
Trade accounts receivable, net (Note 2) | 80,362,227 | 57,467,548 |
Prepaid expenses & other current assets | 12,583,536 | 11,501,338 |
Total current assets | 227,789,967 | 156,952,284 |
Property and equipment, net | 9,332,791 | 12,247,240 |
Intangible assets, net | 2,266,675 | 2,393,704 |
Deferred income taxes, net (Note 2) | 1,421,453 | |
Other assets | 426,484 | 446,051 |
Total assets | 241,237,370 | 172,039,279 |
Current liabilities: | ||
Accounts payable | 61,132,765 | 41,402,523 |
Accrued expenses | 20,985,853 | 19,750,737 |
Dividend payable | 36,455,955 | |
Other current liabilities | 2,597,602 | 2,902,879 |
Total current liabilities | 121,172,175 | 64,056,139 |
Deferred income taxes, net (Note 2) | 496,542 | |
Other long-term liabilities | 4,259,175 | 3,349,820 |
Total liabilities | $ 125,431,350 | $ 67,902,501 |
Commitments and contingencies (Notes 2, 3, 6, 7 and 9) | ||
Stockholders' equity: | ||
Common stock, $0.0001 par, 200,000,000 shares authorized, 65,636,707 and 65,303,205 shares issued and outstanding | $ 6,564 | $ 6,531 |
Additional paid-in capital | 100,929,461 | 94,689,650 |
Retained earnings | 14,869,995 | 9,440,597 |
Total stockholders' equity | 115,806,020 | 104,136,778 |
Total liabilities and stockholders' equity | $ 241,237,370 | $ 172,039,279 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 |
Common stock, par | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 65,636,707 | 65,303,205 |
Common stock, shares outstanding | 65,636,707 | 65,303,205 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | |||||||||||
Portal revenues | $ 66,435,417 | $ 70,122,162 | $ 71,030,846 | $ 65,913,898 | $ 62,148,395 | $ 65,304,664 | $ 66,807,907 | $ 61,482,452 | $ 273,502,323 | $ 255,743,418 | $ 235,183,005 |
Software & services revenues | 4,723,198 | 4,924,120 | 4,781,930 | 4,444,725 | 3,869,507 | 4,222,534 | 4,345,879 | 3,915,233 | 18,873,973 | 16,353,153 | 14,095,660 |
Total revenues | 71,158,615 | 75,046,282 | 75,812,776 | 70,358,623 | 66,017,902 | 69,527,198 | 71,153,786 | 65,397,685 | 292,376,296 | 272,096,571 | 249,278,665 |
Operating expenses: | |||||||||||
Cost of portal revenues, exclusive of depreciation & amortization (Note 2) | 42,798,666 | 41,057,942 | 42,815,102 | 41,494,301 | 39,984,873 | 39,090,865 | 39,550,094 | 37,559,503 | 168,166,011 | 156,185,335 | 147,007,246 |
Cost of software & services revenues, exclusive of depreciation & amortization | 1,456,122 | 1,364,726 | 1,321,259 | 1,289,860 | 1,258,356 | 1,287,083 | 1,244,843 | 993,324 | 5,431,967 | 4,783,606 | 4,498,233 |
Selling & administrative | 11,165,707 | 10,576,445 | 10,818,680 | 10,537,491 | 9,490,401 | 10,396,876 | 9,840,579 | 9,208,685 | 43,098,323 | 38,936,541 | 36,881,346 |
Depreciation & amortization | 1,673,405 | 2,116,319 | 2,303,571 | 2,292,118 | 2,357,854 | 2,292,382 | 2,277,048 | 2,249,734 | 8,385,413 | 9,177,018 | 8,333,089 |
Total operating expenses | 57,093,900 | 55,115,432 | 57,258,612 | 55,613,770 | 53,091,484 | 53,067,206 | 52,912,564 | 50,011,246 | 225,081,714 | 209,082,500 | 196,719,914 |
Operating income (loss) before income taxes | 67,294,582 | 63,014,071 | 52,558,751 | ||||||||
Income tax provision | 5,080,726 | 7,180,660 | 7,250,724 | 5,803,949 | 4,634,174 | 6,098,567 | 7,213,057 | 6,010,054 | 25,316,059 | 23,955,852 | 20,520,660 |
Net income | $ 8,983,989 | $ 12,750,190 | $ 11,303,440 | $ 8,940,904 | $ 8,292,244 | $ 10,361,425 | $ 11,028,165 | $ 9,376,385 | $ 41,978,523 | $ 39,058,219 | $ 32,038,091 |
Basic net income per share (Note 2) | $ 0.13 | $ 0.19 | $ 0.17 | $ 0.14 | $ 0.12 | $ 0.16 | $ 0.17 | $ 0.14 | $ 0.63 | $ 0.59 | $ 0.49 |
Diluted net income per share (Note 2) | $ 0.13 | $ 0.19 | $ 0.17 | $ 0.14 | $ 0.12 | $ 0.16 | $ 0.17 | $ 0.14 | $ 0.63 | $ 0.59 | $ 0.49 |
Weighted average shares outstanding: | |||||||||||
Basic | 65,621,684 | 65,617,812 | 65,587,822 | 65,387,427 | 65,301,797 | 65,287,702 | 65,244,575 | 65,056,725 | 65,554,655 | 65,223,549 | 64,888,978 |
Diluted | 65,715,951 | 65,636,436 | 65,587,822 | 65,387,427 | 65,363,104 | 65,287,702 | 65,244,575 | 65,056,725 | 65,639,682 | 65,277,758 | 64,954,366 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Total | Common Stock | Additional Paid-in Capital | Retained Earnings |
Beginning Balance (in shares) at Dec. 31, 2012 | 64,628,105 | |||
Beginning Balance at Dec. 31, 2012 | $ 78,924,370 | $ 6,463 | $ 84,308,249 | $ (5,390,342) |
Net income | 32,038,091 | 32,038,091 | ||
Dividends declared | (22,982,447) | (22,982,447) | ||
Dividend equivalents on performance-based restricted stock awards | (132,215) | (132,215) | ||
Dividend equivalents cancelled upon forfeiture of performance-based restricted stock awards | 49,909 | 49,909 | ||
Restricted stock vestings (in shares) | 401,794 | |||
Restricted stock vestings | 82,620 | $ 40 | 82,580 | |
Shares surrendered and cancelled upon vesting of restricted stock to satisfy tax withholdings (in shares) | (124,890) | |||
Shares surrendered and cancelled upon vesting of restricted stock to satisfy tax withholdings | (2,276,163) | $ (12) | (2,276,151) | |
Stock-based compensation | 4,025,960 | 4,025,960 | ||
Tax deductions relating to stock-based compensation | 1,302,005 | 1,302,005 | ||
Shares issuable in lieu of dividend payments on unvested performance-based restricted stock awards | (314) | (314) | ||
Issuance of common stock under employee stock purchase plan (in shares) | 87,578 | |||
Issuance of common stock under employee stock purchase plan | 904,471 | $ 9 | 904,462 | |
Ending Balance at Dec. 31, 2013 | 91,936,287 | $ 6,500 | 88,396,700 | 3,533,087 |
Ending Balance (in shares) at Dec. 31, 2013 | 64,992,587 | |||
Net income | 39,058,219 | 39,058,219 | ||
Dividends declared | (32,977,016) | (32,977,016) | ||
Dividend equivalents on performance-based restricted stock awards | (173,693) | (173,693) | ||
Dividend equivalents cancelled upon forfeiture of performance-based restricted stock awards | 35,496 | 35,496 | ||
Restricted stock vestings (in shares) | 357,960 | |||
Restricted stock vestings | 72,519 | $ 36 | 72,483 | |
Shares surrendered and cancelled upon vesting of restricted stock to satisfy tax withholdings (in shares) | (115,443) | |||
Shares surrendered and cancelled upon vesting of restricted stock to satisfy tax withholdings | (2,276,247) | $ (12) | (2,276,235) | |
Stock-based compensation | 6,103,898 | 6,103,898 | ||
Tax deductions relating to stock-based compensation | 1,184,860 | 1,184,860 | ||
Shares issuable in lieu of dividend payments on unvested performance-based restricted stock awards | 65,678 | 65,678 | ||
Issuance of common stock under employee stock purchase plan (in shares) | 68,101 | |||
Issuance of common stock under employee stock purchase plan | 1,106,777 | $ 7 | 1,106,770 | |
Ending Balance at Dec. 31, 2014 | $ 104,136,778 | $ 6,531 | 94,689,650 | 9,440,597 |
Ending Balance (in shares) at Dec. 31, 2014 | 65,303,205 | 65,303,205 | ||
Net income | $ 41,978,523 | 41,978,523 | ||
Dividends declared | (36,455,955) | (36,455,955) | ||
Dividend equivalents on performance-based restricted stock awards | (158,652) | (158,652) | ||
Dividend equivalents cancelled upon forfeiture of performance-based restricted stock awards | 82,423 | 16,941 | 65,482 | |
Restricted stock vestings (in shares) | 364,380 | |||
Restricted stock vestings | 73,941 | $ 36 | 73,905 | |
Shares surrendered and cancelled upon vesting of restricted stock to satisfy tax withholdings (in shares) | (106,206) | |||
Shares surrendered and cancelled upon vesting of restricted stock to satisfy tax withholdings | (1,838,173) | $ (11) | (1,838,162) | |
Stock-based compensation | 6,440,841 | 6,440,841 | ||
Tax deductions relating to stock-based compensation | 412,617 | 412,617 | ||
Shares issuable in lieu of dividend payments on unvested performance-based restricted stock awards | 2,288 | 2,288 | ||
Issuance of common stock under employee stock purchase plan (in shares) | 75,328 | |||
Issuance of common stock under employee stock purchase plan | 1,131,389 | $ 8 | 1,131,381 | |
Ending Balance at Dec. 31, 2015 | $ 115,806,020 | $ 6,564 | $ 100,929,461 | $ 14,869,995 |
Ending Balance (in shares) at Dec. 31, 2015 | 65,636,707 | 65,636,707 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Net income | $ 41,978,523 | $ 39,058,219 | $ 32,038,091 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation & amortization | 8,385,413 | 9,177,018 | 8,333,089 |
Provision for losses on accounts receivable (Note 2) | 289,666 | 414,042 | 5,229,277 |
Stock-based compensation expense | 6,440,841 | 6,103,898 | 4,025,960 |
Deferred income taxes | (3,814,774) | (2,461,240) | (1,069,988) |
Loss on disposal of property and equipment | 98,181 | 174,497 | 51,301 |
Changes in operating assets and liabilities: | |||
(Increase) in trade accounts receivable, net | (23,184,345) | (5,063,238) | (2,786,606) |
(Increase) decrease in prepaid expenses & other current assets | 814,581 | 1,631,159 | (927,644) |
(Increase) decrease in other assets | 19,567 | (156,083) | (37,203) |
Increase (decrease) in accounts payable | 19,730,242 | 2,326,103 | (4,502,022) |
(Decrease) in accrued expenses | (603,735) | (3,450,041) | (586,798) |
Increase (decrease) in other current liabilities | (305,277) | 2,627,655 | 222,786 |
Increase in other long-term liabilities | 909,355 | 900,344 | 863,096 |
Net cash provided by operating activities | 50,758,238 | 51,282,333 | 40,853,339 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (4,453,495) | (5,380,800) | (6,717,034) |
Proceeds from sale of property and equipment | 3,600 | 400 | 16,153 |
Capitalized internal use software development costs | (991,543) | (1,478,623) | (1,489,286) |
Net cash used in investing activities | (5,441,438) | (6,859,023) | (8,190,167) |
Cash flows from financing activities: | |||
Cash dividends on common stock | (32,977,016) | ||
Cash restricted for payment of dividend | (36,455,955) | (22,982,447) | |
Proceeds from employee common stock purchases | 1,131,389 | 1,106,777 | 904,471 |
Tax deductions related to stock-based compensation | 412,617 | 1,184,860 | 1,302,005 |
Net cash used in financing activities | (34,911,949) | (30,685,379) | (20,775,971) |
Net increase in cash and cash equivalents | 10,404,851 | 13,737,931 | 11,887,201 |
Cash and cash equivalents, beginning of period | 87,983,398 | 74,245,467 | 62,358,266 |
Cash and cash equivalents, end of period | 98,388,249 | 87,983,398 | 74,245,467 |
Non-cash investing activities: | |||
Capital expenditures accrued but not yet paid | 678 | 102,088 | 185,001 |
Cash payments: | |||
Income taxes paid | $ 27,222,391 | 25,059,316 | $ 15,939,214 |
Cash dividends on common stock previously restricted for payment of dividend | $ 22,982,447 |
THE COMPANY
THE COMPANY | 12 Months Ended |
Dec. 31, 2015 | |
THE COMPANY | 1. THE COMPANY NIC Inc. (the “Company” or “NIC”) is a leading provider of digital government services that help governments use technology to reduce internal costs, increase efficiencies and provide a higher level of service to businesses and citizens. The Company accomplishes this currently through two channels: its primary outsourced portal businesses and its software & services businesses. In its primary outsourced portal businesses, the Company generally designs, builds, and operates Internet-based portals on an enterprise-wide basis on behalf of state and local governments desiring to provide access to government information and to complete secure government-based transactions through multiple online channels, including mobile devices. These portals consist of websites and applications the Company has built that allow businesses and citizens to access government information online and complete transactions, such as applying for a permit, retrieving government records, or filing a government-mandated form or report. Operating under multiple-year contracts (see Note 3), NIC markets the services and solicits users to complete government-based transactions and to enter into subscriber contracts permitting users to access the portal and the government information contained therein in exchange for transactional and/or subscription user fees. The Company typically manages operations for each contractual relationship through separate local subsidiaries that operate as decentralized businesses with a high degree of autonomy. NIC’s self-funded business model allows the Company to generate revenues by sharing in the fees the Company collects from online transactions. The Company’s government partners benefit by reducing their financial and technological risks, increasing their operational efficiencies, and gaining a centralized, customer-focused presence on the Internet, while businesses and citizens receive a faster, more convenient, and more cost-effective means to interact with governments. The Company is typically responsible for funding the up-front investments and ongoing operations and maintenance costs of the outsourced government portals. The Company’s software & services businesses primarily include its subsidiaries that provide software development and services, other than outsourced portal services, to state and local governments as well as federal agencies (see Note 3). |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2015 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The Company classifies its revenues and cost of revenues into two categories: (1) portal and (2) software & services. The portal category generally includes revenues and cost of revenues from the Company’s subsidiaries operating outsourced portals on behalf of state and local governments. The software & services category primarily includes revenues and cost of revenues from the Company’s subsidiaries that provide software development and services, other than outsourced portal services, to state and local governments as well as federal agencies. The primary categories of operating expenses include: cost of portal revenues, cost of software & services revenues, selling & administrative and depreciation & amortization. Cost of portal revenues consists of all direct costs associated with operating government portals on an outsourced basis including employee compensation and benefits (including stock-based compensation), fees required to process credit/debit card and automated clearinghouse transactions, subcontractor labor costs, telecommunications, provision for losses on accounts receivable, gains and losses on disposal of assets and all other costs associated with the provision of dedicated client service such as dedicated facilities. Basis of consolidation The accompanying consolidated financial statements consolidate the Company together with all of its direct and indirect wholly owned subsidiaries. All intercompany balances and transactions have been eliminated. Cash and cash equivalents Cash and cash equivalents primarily include cash on hand in the form of bank deposits. For purposes of the consolidated balance sheets and consolidated statements of cash flows, the Company considers all non-restricted highly liquid instruments purchased with an original maturity of one month or less to be cash equivalents. Cash restricted for payment of dividend Restricted cash represents cash which is restricted for use by NIC. On November 2, 2015, the Company’s Board of Directors declared a special cash dividend of $0.55 per share, payable to stockholders of record as of November 13, 2015. The dividend, totaling approximately $36.5 million, was paid on January 4, 2016 out of the Company’s available cash. Cash used to pay the special dividend was classified as restricted at December 31, 2015. Trade accounts receivable The Company records trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts. The Company calculates this allowance based on its history of write-offs, the level of past-due accounts, and its relationship with, and the economic status of, its customers. Trade accounts receivable are written off when deemed uncollectible. Recoveries of receivables previously written off are recorded when received. As previously disclosed in prior filings with the SEC, in September 2013, the Company elected not to pursue collection of outstanding accounts receivable from the Commonwealth of Pennsylvania (the “Commonwealth”) and recorded a non-cash pre-tax charge of approximately $5.1 million (approximately $0.05 per share on an after-tax basis) in the third quarter of 2013 to write-off amounts due from the Commonwealth through June 30, 2013. The charge is included in cost of portal revenues in the Company’s consolidated statements of income for the year ended December 31, 2013. The Company continued to provide eGovernment solutions under the contract with the Commonwealth, but did not recognize revenues under the contract subsequent to June 30, 2013 until the contract became self-funded in October 2013. The Company’s allowance for doubtful accounts at both December 31, 2015 and 2014 was approximately $0.5 million. Property and equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over estimated useful lives of 8 years for furniture and fixtures, 3-10 years for equipment, 3-5 years for purchased software, and the lesser of the term of the lease or 5 years for leasehold improvements. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in results of operations for the period. The cost of maintenance and repairs is charged to expense as incurred. Significant betterments are capitalized. The Company periodically evaluates the carrying value of property and equipment to be held and used when events and circumstances warrant such a review. The carrying value of property and equipment is considered impaired when the anticipated undiscounted cash flow from the asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the asset. Fair value is determined primarily using the anticipated cash flow discounted at a rate commensurate with the risk involved. Losses on assets to be disposed of are determined in a similar manner, except that fair values are reduced for the cost to dispose. The Company did not record any material impairment losses on property and equipment during the periods presented. Software development costs and intangible assets The Company expenses as incurred all employee costs to start up, operate, and maintain government portals on an outsourced basis as costs of performance under the contracts because, after the completion of a defined contract term, the government entity with which the Company contracts typically receives a perpetual, royalty-free license to the applications the Company developed, excluding applications provided on a SaaS basis. Such costs are included in cost of portal revenues in the consolidated statements of income. The Company accounts for the costs of developing internal use computer software in accordance with authoritative accounting guidance for internal use computer software, whereby certain costs of developing internal use computer software are capitalized and amortized over their estimated useful life. For internal use computer software, the estimated economic life is typically 36 months from the date the software is placed in production. At December 31, 2015 and 2014, such costs are included in intangible assets in the consolidated balance sheets. The Company carries intangible assets at cost less accumulated amortization. Intangible assets are generally amortized on a straight-line basis over estimated economic lives of the respective assets. At each balance sheet date, or whenever events or changes in circumstances warrant, the Company assesses the carrying value of intangible assets for possible impairment based primarily on the ability to recover the balances from expected future cash flows on an undiscounted basis. If the sum of the expected future cash flows on an undiscounted basis were to be less than the carrying amount of the intangible asset, an impairment loss would be recognized for the amount by which the carrying value of the intangible asset exceeds its estimated fair value. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. The Company has not recorded any material impairment losses on intangible assets during the periods presented. Accrued expenses As of each balance sheet date, the Company estimates expenses which have been incurred but not yet paid or for which invoices have not yet been received. Significant components of accrued expenses consist primarily of employee compensation and benefits (including incentive compensation, bonuses, vacation, health insurance and employer 401(k) contributions), third-party professional service fees, payment processing fees, and miscellaneous other accruals. Revenue recognition Portal revenues The Company recognizes revenue from providing outsourced digital government services (primarily transaction-based information access fees and filing fees) net of the transaction fees due to the government when the services are provided at the time of the transactions. The fees that the Company must remit to state agencies for data access and other statutory fees are accrued as accounts payable when the services are provided at the time of the transactions. The Company must remit a certain amount or percentage of these fees to government agencies regardless of whether the Company ultimately collects the fees. As a result, trade accounts receivable and accounts payable reflect the gross amounts outstanding at the balance sheet dates. Revenue from service contracts to provide portal consulting, application development, and management services to governments is recognized as the services are provided at rates provided for in the contract. Amounts received prior to providing services are recorded as unearned revenue. At each balance sheet date, the Company makes a determination as to the portion of unearned revenue that will be earned within one year and records that amount in other current liabilities in the consolidated balance sheets. The remainder, if any, is recorded in other long-term liabilities. Unearned revenues at December 31, 2015 and 2014 were approximately $0.9 million and $1.3 million, respectively, and were recorded in other current liabilities in the consolidated balance sheets. Software & services revenues The Company’s software & services revenues primarily include revenues from subsidiaries that provide software development and services, other than outsourced portal services, to state and local governments as well as federal agencies. The Company’s subsidiary, NIC Federal, LLC (“NIC Federal”) currently earns a significant portion of its revenues from its contract with the Federal Motor Carrier Safety Administration (“FMCSA”) to develop and manage the FMCSA’s Pre-Employment Screening Program (“PSP”) for motor carriers nationwide, using a self-funded, transaction-based business model. NIC Federal recognizes revenue from its contract with the FMCSA (primarily transaction-based information access fees) when the services are provided at the time of the transactions. NIC Federal also earns a portion of its revenues from fixed fee and time and materials application development and outsourced maintenance contracts with other government agencies and recognizes revenues as the services are provided. Stock-based compensation The Company measures stock-based compensation cost for service-based restricted stock awards at the grant date based on the calculated fair value of the award, and recognizes an expense over the employee’s requisite service period (generally the vesting period of the grant). The Company measures stock-based compensation cost for performance-based restricted stock awards at the date of grant, based on the fair value of shares expected to be earned at the end of the performance period, and recognizes an expense over the performance period based upon the probable number of shares expected to vest. The Company estimates and excludes compensation cost related to awards not expected to vest based upon estimated forfeitures (See Note 10). Income taxes The Company, along with its wholly owned subsidiaries, files a consolidated federal income tax return. Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end based on enacted laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized. The Company does not recognize a tax benefit for uncertain tax positions unless management’s assessment concludes that it is “more likely than not” that the position is sustainable, based on its technical merits. If the recognition threshold is met, the Company recognizes a tax benefit based upon the largest amount of the tax benefit that is greater than 50% likely to be realized. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense in the consolidated statements of income. Fair value of financial instruments The carrying values of the Company’s accounts receivable and accounts payable approximate fair value. Comprehensive income The Company has no components of other comprehensive income or loss and, accordingly, the Company’s comprehensive income is the same as its net income for all periods presented. Earnings per share Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are considered participating securities and are included in the computation of earnings per share pursuant to the two-class method for all periods presented. The two-class method is an earnings allocation formula that treats a participating security as having rights to undistributed earnings that would otherwise have been available to common stockholders. The Company’s service-based restricted stock awards contain non-forfeitable rights to dividends and are considered participating securities. Accordingly, service-based restricted stock awards were included in the calculation of earnings per share using the two-class method for all periods presented. Unvested service-based restricted shares totaled approximately 0.6 million, 0.6 million and 0.7 million, respectively, at December 31, 2015, 2014 and 2013. Basic earnings per share is calculated by first allocating earnings between common stockholders and participating securities. Earnings attributable to common stockholders are divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by giving effect to dilutive potential common shares outstanding during the period. The dilutive effect of shares related to the Company’s employee stock purchase plan is determined based on the treasury stock method. The dilutive effect of service-based restricted stock awards is based on the more dilutive of the treasury stock method or the two-class method assuming a reallocation of undistributed earnings to common stockholders after considering the dilutive effect of potential common shares other than the participating unvested restricted stock awards. The dilutive effect of performance-based restricted stock awards is based on the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share: December 31, 2015 2014 2013 Numerator: Net income $ 41,978,523 $ 39,058,219 $ 32,038,091 Less: Income allocated to participating securities (384,246 ) (368,668 ) (325,182 ) Net income available to common stockholders $ 41,594,277 $ 38,689,551 $ 31,712,909 Denominator: Weighted average shares - basic 65,554,655 65,223,549 64,888,978 Performance-based restricted stock awards 85,027 54,209 65,388 Weighted average shares - diluted 65,639,682 65,277,758 64,954,366 Basic net income per share: Net income $ 0.63 $ 0.59 $ 0.49 Diluted net income per share: Net income $ 0.63 $ 0.59 $ 0.49 Concentration of credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and accounts receivable. The Company limits its exposure to credit loss by depositing its cash with high credit quality financial institutions and monitoring the financial stability of those institutions. The Federal Deposit Insurance Corporation (“FDIC”) provides deposit insurance coverage up to $250,000 per depositor for deposit accounts at each FDIC-insured depository institution. At December 31, 2015, the amount of cash covered by FDIC deposit insurance was approximately $10.2 million, and approximately $88.2 million of cash was above the FDIC deposit insurance limit. The Company performs ongoing credit evaluations of its customers and generally requires no collateral to secure accounts receivable. Segment reporting The Company reports segment information in accordance with authoritative accounting guidance for segment disclosures based upon the “management” approach, which designates the internal organization that is used by management for making operating decisions and assessing performance as the source of the Company’s segments. Authoritative guidance for segment disclosures also requires disclosures about products and services and major customers (See Note 11). Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recently adopted accounting pronouncements In November 2015, the Financial Accounting Standards Board (“FASB”) issued new authoritative literature, Balance Sheet Classification of Deferred Taxes, to simplify the financial statement presentation of deferred taxes in the balance sheet. The standard requires that all deferred tax assets and liabilities be classified as noncurrent. The standard is effective for the annual reporting period beginning January 1, 2017, including interim periods within that reporting period, and early adoption is permitted as of the beginning of any interim or annual reporting period. The standard may be adopted either prospectively to all deferred tax assets and liabilities or retrospectively to all periods presented. The Company adopted the standard on a retrospective basis effective for the year ended December 31, 2015. The adoption of the standard resulted in a decrease in current net deferred tax assets of approximately $1.0 million and a corresponding decrease in noncurrent net deferred tax liabilities in the Company’s consolidated balance sheet at December 31, 2014. Recently issued accounting pronouncements In May 2014, the FASB issued new authoritative literature, Revenue from Contracts with Customers, as part of a joint effort by the FASB and the International Accounting Standards Board to enhance financial reporting by creating common revenue recognition guidance and thereby improve the consistency of requirements, comparability of practices and usefulness of disclosures. The new standard will supersede much of the existing authoritative literature for revenue recognition. The standard and related amendments will be effective for the Company for its annual reporting period beginning January 1, 2018, including interim periods within that reporting period. Entities are allowed to transition to the new standard by either recasting prior periods presented or recognizing the cumulative effect of the change in accounting principle in beginning stockholders’ equity. The Company is currently evaluating the newly issued guidance, including which transition approach will be applied and the estimated impact it will have on the Company’s consolidated financial statements. |
OUTSOURCED GOVERNMENT CONTRACTS
OUTSOURCED GOVERNMENT CONTRACTS | 12 Months Ended |
Dec. 31, 2015 | |
OUTSOURCED GOVERNMENT CONTRACTS | 3. OUTSOURCED GOVERNMENT CONTRACTS Outsourced portal contracts The Company’s outsourced government portal contracts generally have an initial multi-year term with provisions for renewals for various periods at the option of the government. The Company’s primary business obligation under these contracts is generally to design, build, and operate Internet-based portals on an enterprise-wide basis on behalf of governments desiring to provide access to government information and to complete government-based transactions online. NIC typically markets the services and solicits users to complete government-based transactions and to enter into subscriber contracts permitting the user to access the portal and the government information contained therein in exchange for transactional and/or subscription user fees. The Company enters into separate agreements with various agencies and divisions of the government to provide specific services and to conduct specific transactions. These agreements preliminarily establish the pricing of the online transactions and data access services the Company provides and the division of revenues between the Company and the government agency. The government oversight authority must approve prices and revenue sharing agreements. The Company has limited control over the level of fees it is permitted to retain. Any changes made to the amount or percentage of fees retained by NIC, or to the amounts charged for the services offered, could materially affect the profitability of the respective contract. The Company is typically responsible for funding the up-front investments and ongoing operations and maintenance costs of the government portals, and generally owns all of the intellectual property in connection with the applications developed under these contracts. After completion of a defined contract term, the government partner typically receives a perpetual, royalty-free license to use the software only in its own portal. However, certain customer management, billing and payment processing software applications that the Company has developed and standardized centrally and that are utilized by the Company’s portal businesses, are being provided to a number of government partners on a software-as-a-service (“SaaS”) basis, and thus would not be included in any royalty-free license. If the Company’s contract is not renewed after a defined term or if its contract is terminated by a government partner for cause, the government agency would be entitled to take over the portal in place, and NIC would have no future revenue from, or obligation to, such former government partner, except as otherwise provided in the contract. Any renewal of these contracts beyond the initial term by the government is optional and a government may terminate its contract prior to the expiration date if the Company breaches a material contractual obligation and fails to cure such breach within a specified period or upon the occurrence of other events or circumstances specified in the contract. In addition, 18 contracts under which the Company provides outsourced portal services, software development and digital government services can be terminated by the other party without cause on a specified period of notice. Collectively, revenues generated from these contracts represented approximately 64% of the Company’s total consolidated revenues for the year ended December 31, 2015. In the event that any of these contracts is terminated without cause, the terms of the respective contract may require the government to pay the Company a fee in order to continue to use the Company’s software in its portal. In addition, the loss of one or more of the Company’s larger state portal partners, such as Alabama, Arkansas, Colorado, Indiana, Kentucky, New Jersey, Pennsylvania, South Carolina, Tennessee, Texas, or Utah, as a result of the expiration, termination or failure to renew the respective contract, if such partner is not replaced, could significantly reduce the Company’s revenues and profitability. See the discussion below under “Expiring Contracts” regarding the expiration of the Company’s contracts with the states of Arizona and Delaware. Under a typical portal contract, the Company is required to fully indemnify its government clients against claims that the Company’s services infringe upon the intellectual property rights of others and against claims arising from the Company’s performance or the performance of the Company’s subcontractors under the contract. At December 31, 2015, the Company was bound by performance bond commitments totaling approximately $6.1 million on certain outsourced portal contracts. The Company has never had any defaults resulting in draws on performance bonds (See Note 6). The following is a summary of the portals in each state through which the Company provides enterprise-wide outsourced portal services to multiple government agencies: NIC Portal Entity Portal Website (State) Year Services Commenced Contract Expiration Date (Renewal Options Through) Connecticut Interactive, LLC www.ct.gov (Connecticut) 2014 1/9/2017 (1/9/2020) Wisconsin Interactive Network, LLC www.wisconsin.gov (Wisconsin) 2013 5/13/2018 (5/13/2023) Pennsylvania Interactive, LLC www.pa.gov (Pennsylvania) 2012 11/30/2017 (11/30/2022) NICUSA, OR Division www.oregon.gov (Oregon) 2011 11/22/2021 NICUSA, MD Division www.maryland.gov (Maryland) 2011 8/10/2017 (8/10/2019) Mississippi Interactive, LLC www.ms.gov (Mississippi) 2011 12/31/2017 (12/31/2021) New Jersey Interactive, LLC www.nj.gov (New Jersey) 2009 5/1/2020 (5/1/2022) Texas NICUSA, LLC www.Texas.gov (Texas) 2009 8/31/2018 West Virginia Interactive, LLC www.WV.gov (West Virginia) 2007 3/31/2016 Vermont Information Consortium, LLC www.Vermont.gov (Vermont) 2006 6/8/2016 (6/8/2019) Colorado Interactive, LLC www.Colorado.gov (Colorado) 2005 4/30/2019 (4/30/2023) South Carolina Interactive, LLC www.SC.gov (South Carolina) 2005 7/15/2019 (7/15/2021) Kentucky Interactive, LLC www.Kentucky.gov (Kentucky) 2003 8/31/2016 Alabama Interactive, LLC www.Alabama.gov (Alabama) 2002 3/1/2016 (3/1/2017) Rhode Island Interactive, LLC www.RI.gov (Rhode Island) 2001 7/1/2017 (7/1/2019) Oklahoma Interactive, LLC www.OK.gov (Oklahoma) 2001 3/31/2016 (3/31/2020) Montana Interactive, LLC www.MT.gov (Montana) 2001 12/31/2017 (12/31/2020) NICUSA, TN Division www.TN.gov (Tennessee) 2000 3/31/2017 Hawaii Information Consortium, LLC www.eHawaii.gov (Hawaii) 2000 1/3/2019 (3-year renewal options) Idaho Information Consortium, LLC www.Idaho.gov (Idaho) 2000 6/30/2017 Utah Interactive, LLC www.Utah.gov (Utah) 1999 6/5/2019 Maine Information Network, LLC www.Maine.gov (Maine) 1999 7/1/2018 Arkansas Information Consortium, LLC www.Arkansas.gov (Arkansas) 1997 6/30/2018 Iowa Interactive, LLC www.Iowa.gov (Iowa) 1997 6/30/2016 (6/30/2020) Indiana Interactive, LLC www.IN.gov (Indiana) 1995 7/31/2016 Nebraska Interactive, LLC www.Nebraska.gov (Nebraska) 1995 4/1/2019 (4/1/2021) Kansas Information Consortium, LLC www.Kansas.gov (Kansas) 1992 12/31/2021 (annual 1-year renewal options) During the first quarter of 2015, the Company received two-year contract extensions from the states of Montana and Idaho. In addition, the Company executed one-year contract extensions with the states of Alabama and Tennessee. During the second quarter of 2015, the Company signed a new one-year contract with the state of Oklahoma, which includes four one-year renewal options. In addition, the Company was awarded a new five-year contract with the state of New Jersey, which includes two one-year renewal options. The Company also executed a three-year contract extension with the state of Utah. During the third quarter of 2015, the Company executed one-year contract extensions with the Commonwealth of Kentucky and the state of Maryland. During the fourth quarter of 2015, the Company executed a two-year contract extension with the state of Maine and a one-year contract extension with the state of Texas. In addition, the Company signed a new three-year contract with the state of Nebraska, which includes two one-year renewal options. The Company also executed a three-year contract extension with the state of Hawaii and a two-year contract extension with the state of Mississippi. Other outsourced state contracts During the third quarter of 2014, the Company’s subsidiary, Louisiana Interactive, LLC, signed a master contract with the state of Louisiana Division of Administration, Office of Technology Services (“Louisiana Division”) that creates a framework to provide certain digital government services for a pilot period. The pilot period commenced during the first quarter of 2015 and the Company anticipates it will conclude within approximately 18 months after the commencement of the pilot period. Subsequent to the pilot period, the Louisiana Division has the option to receive enterprise-wide eGovernment solutions pursuant to the master contract. The Company’s subsidiary, New Mexico Interactive, LLC, has a contract to manage digital government services for the New Mexico Motor Vehicle Division and its parent, the New Mexico Taxation and Revenue Department. The current contract runs through June 30, 2016 and includes two one-year renewal options. During the third quarter of 2015, the Company’s subsidiary, Virginia Interactive, LLC (“VI”) extended its agreement with the Office of the Executive Secretary of the Supreme Court of Virginia to provide digital government services through August 31, 2016. The agreement includes seven one-year renewal options. During the third quarter of 2015, VI extended its agreement with the Virginia Department of Game and Inland Fisheries (“DGIF”) to provide digital government services through August 31, 2016. During the fourth quarter of 2015, DGIF informed VI it does not intend to renew its contract with VI when the contract term expires on August 31, 2016. VI will provide transition services as required by the contract through the August 31, 2016 expiration date of the contract. The Company does not believe the expiration of its contract with DGIF will have a material impact on the Company’s consolidated results of operations, cash flows or financial condition. Outsourced federal contracts NIC Federal has a contract with the FMCSA to develop and manage the FMCSA’s Pre-Employment Screening Program for motor carriers nationwide, using the self-funded, transaction-based business model. During the third quarter of 2015, the Company signed a new one-year contract with the FMCSA that runs through August 31, 2016, which includes two one-year renewal options. Any renewal of the contract with the FMCSA beyond the current term is at the option of the FMCSA and the contract can be terminated by the FMCSA without cause on a specified period of notice. The loss of the contract as a result of the expiration, termination or failure to renew the contract, if not replaced, could significantly reduce the Company’s revenues and profitability. In addition, the Company has limited control over the level of fees it is permitted to retain under the contract with the FMCSA. Any changes made to the amount or percentage of fees retained by the Company, or to the amounts charged for the services offered, could materially affect the profitability of this contract. Expiring contracts As of December 31, 2015, there were 10 contracts under which the Company provides outsourced portal services, software development and digital government services that have expiration dates within the 12-month period following December 31, 2015. Collectively, revenues generated from these contracts represented approximately 22% of the Company’s total consolidated revenues for the year ended December 31, 2015. As described above, if a contract is not renewed after a defined term, the government partner would be entitled to take over the portal in place, and NIC would have no future revenue from, or obligation to, such former government partner, except as otherwise provided in the contract. During the first quarter of 2013, the Company’s subsidiary, NICUSA, Inc. (“NICUSA”), chose not to respond to a request for proposal issued by the state of Arizona for a new contract. NICUSA provided transition services as required by the contract through the March 26, 2014 final expiration date of the contract. The costs incurred in transitioning out of NICUSA’s contract with the state of Arizona, including employee retention bonuses, operating lease termination costs, and fixed asset impairment, did not have a material impact on the Company’s consolidated results of operations, cash flows, or financial condition. For the years ended December 31, 2014 and 2013 revenues from the legacy Arizona portal contract were approximately $0.8 million and $3.7 million, respectively. The contract under which the Company’s subsidiary, Delaware Interactive, LLC (“DI”), managed the state of Delaware’s official government portal expired on March 31, 2015. The primary revenue source for DI under the contract was an annual portal management fee paid to DI by the state. During the second quarter of 2014, the state informed DI that due to fiscal constraints, it did not intend to renew its contract with DI when the contract term expired. The costs incurred in transitioning out of DI’s contract with the state of Delaware, including employee retention bonuses, operating lease termination costs, and fixed asset impairment, did not have a material impact on the Company’s consolidated results of operations, cash flows, or financial condition. For the years ended December 31, 2015, 2014 and 2013 revenues from the Delaware portal contract were approximately $0.6 million, $2.4 million, and $2.2 million, respectively. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2015 | |
INTANGIBLE ASSETS, NET | 4. INTANGIBLE ASSETS, NET Intangible assets, net consisted of the following at December 31: December 31, 2015 December 31, 2014 Gross Carrying Value Accumulated Amortization Net Book Value Gross Carrying Value Accumulated Amortization Net Book Value Internal use capitalized $ 7,657,843 $ (5,391,168 ) $ 2,266,675 $ 6,666,300 $ (4,272,596 ) $ 2,393,704 Amortization expense for internal use capitalized software totaling approximately $1.1 million, $1.0 million and $0.6 million for the years ended December 31, 2015, 2014 and 2013, respectively, is included in depreciation & amortization in the consolidated statements of income. The total estimated intangible asset amortization expense in future years related to assets that have been placed in production is as follows: Fiscal Year 2016 $ 899,629 2017 468,474 2018 101,867 $ 1,469,970 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2015 | |
PROPERTY AND EQUIPMENT, NET | 5. PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following at December 31: 2015 2014 Equipment $ 29,573,499 $ 28,714,059 Purchased software 11,269,384 10,972,449 Furniture and fixtures 5,127,814 4,924,108 Leasehold improvements 1,956,822 1,402,487 47,927,519 46,013,103 Less accumulated depreciation (38,594,728 ) (33,765,863 ) Property and equipment, net $ 9,332,791 $ 12,247,240 Depreciation expense for the years ended December 31, 2015, 2014 and 2013 was $7.3 million, $8.2 million and $7.7 million, respectively. |
DEBT OBLIGATIONS AND COLLATERAL
DEBT OBLIGATIONS AND COLLATERAL REQUIREMENTS | 12 Months Ended |
Dec. 31, 2015 | |
DEBT OBLIGATIONS AND COLLATERAL REQUIREMENTS | 6. DEBT OBLIGATIONS AND COLLATERAL REQUIREMENTS On July 9, 2015, the Company entered into Amendment No. 1 to Amended and Restated Credit Agreement (the “First Amendment’), which amends the Amended and Restated Credit Agreement, dated as of August 6, 2014, by and between the Company and Bank of America, N.A. (the “Credit Agreement”). The material amendments to the Credit Agreement made by the First Amendment include (a) extending the maturity date to May 1, 2017; and (b) decreasing the margin added to the LIBOR rate for any amounts selected by the Company to be borrowed at the LIBOR rate, and the fees payable on outstanding letters of credit, to either 1.15% (if the Company’s consolidated leverage ratio is less than 1.50:1) or 1.25% (if the Company’s consolidated leverage ratio is greater than or equal to 1.50:1) of face value per annum. On December 14, 2015, the Company entered into Amendment No. 2 to the Credit Agreement (the “Second Amendment”), which amends the Credit Agreement dated as of August 6, 2014, as amended by the First Amendment. The Second Amendment provides that the interest rate on any amounts borrowed by the Company under the Credit Agreement will be at an annual rate benchmarked to LIBOR with a term equivalent to such borrowing or at an annual rate adjusted daily and benchmarked to LIBOR for a one-month term, in each event plus a margin of 1.15% or 1.25% depending on the Company’s consolidated leverage ratio, as discussed above. The Second Amendment also decreases the fees payable by the Company on outstanding letters of credit to 1.00% times the daily amount available to be drawn under any letter of credit. The other material terms of the Credit Agreement remain unchanged, including customary representations and warranties, affirmative and negative covenants and events of default. The Credit Agreement also continues to require the Company to maintain compliance with the following financial covenants (in each case, as defined in the Credit Agreement): ● Consolidated tangible net worth of at least $36 million (plus the amount of net proceeds from equity issued, or debt converted to equity, in each case after the date of the Credit Agreement); and ● Consolidated maximum leverage ratio of 1.5:1 (the ratio of total funded debt to EBITDA). The Company was in compliance with each of these covenants at December 31, 2015. The Company issues letters of credit mainly as collateral for certain office leases, and to a much lesser extent, as collateral for performance on one of its outsourced government portal contracts. These irrevocable letters of credit are generally in force for one year. In total, the Company and its subsidiaries had unused outstanding letters of credit of approximately $1.2 million at December 31, 2015. The Company is not currently required to cash collateralize these letters of credit. The Company had $3.8 million in available capacity to issue additional letters of credit and $8.8 million of unused borrowing capacity at December 31, 2015 under the Credit Agreement. Letters of credit may have an expiration date of up to one year beyond the expiration date of the Credit Agreement. The Credit Agreement also includes an accordion feature that allows the Company to increase the available capacity under the Credit Agreement to $50.0 million, subject to securing additional commitments from the bank. The Company has a $1.0 million line of credit with a bank in conjunction with a corporate credit card agreement. At December 31, 2015, the Company was bound by performance bond commitments totaling approximately $6.1 million on certain outsourced government portal contracts. The Company has never had any defaults resulting in draws on performance bonds. Had the Company been required to post 100% cash collateral at December 31, 2015 for the face value of all performance bonds, letters of credit and its line of credit in conjunction with a corporate credit card agreement, unrestricted cash would have decreased by approximately $8.3 million and would have been classified as restricted cash. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2015 | |
COMMITMENTS AND CONTINGENCIES | 7. COMMITMENTS AND CONTINGENCIES Operating leases The Company and its subsidiaries lease office space and certain equipment under noncancellable operating leases. Future minimum lease payments under all noncancellable operating leases at December 31, 2015 are as follows: Fiscal Year 2016 $ 4,343,767 2017 3,775,439 2018 3,460,437 2019 1,723,802 2020 551,542 Thereafter 205,749 Total minimum lease payments $ 14,060,736 Rent expense for operating leases for the years ended December 31, 2015, 2014 and 2013 was approximately $4.5 million, $4.3 million, and $4.2 million, respectively. Litigation The Company is involved from time to time in legal proceedings and litigation arising in the ordinary course of business. However, the Company is not currently a party to any material legal proceedings. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2015 | |
STOCKHOLDERS' EQUITY | 8. STOCKHOLDERS’ EQUITY Dividends On November 2, 2015, the Company’s Board of Directors declared a special cash dividend of $0.55 per share, payable to stockholders of record as of November 13, 2015. The dividend, totaling approximately $36.5 million, was paid on January 4, 2016 on 65,618,141 outstanding shares of common stock. A dividend equivalent of $0.55 per share was also paid simultaneously on 665,414 unvested shares of service-based restricted stock. The dividend was paid out of the Company’s available cash. On October 27, 2014, the Company’s Board of Directors declared a special cash dividend of $0.50 per share, payable to stockholders of record as of November 7, 2014. The dividend, totaling approximately $33.0 million, was paid on November 20, 2014 on 65,298,472 outstanding shares of common stock. A dividend equivalent of $0.50 per share was also paid simultaneously on 655,499 unvested shares of service-based restricted stock. The dividend was paid out of the Company’s available cash. On October 28, 2013, the Company’s Board of Directors declared a special cash dividend of $0.35 per share, payable to stockholders of record as of November 8, 2013. The dividend, totaling approximately $23.0 million, was paid on January 2, 2014 on 64,987,854 outstanding shares of common stock. A dividend equivalent of $0.35 per share was also paid simultaneously on 676,281 unvested shares of service-based restricted stock. The dividend was paid out of the Company’s available cash. In addition, holders of performance-based restricted stock accrued dividend equivalents, for each of the dividends declared noted above, that could be earned and become payable in the form of shares of common stock at the end of the respective performance period to the extent that the underlying shares of restricted stock were earned. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2015 | |
INCOME TAXES | 9. INCOME TAXES The provision for income taxes consists of the following: Year Ended December 31, 2015 2014 2013 Current income taxes: Federal $ 25,608,500 $ 23,161,061 $ 18,436,209 State 3,522,333 3,256,031 3,154,439 Total 29,130,833 26,417,092 21,590,648 Deferred income taxes: Federal (3,485,844 ) (2,295,450 ) (1,111,536 ) State (328,930 ) (165,790 ) 41,548 Total (3,814,774 ) (2,461,240 ) (1,069,988 ) Total income tax provision $ 25,316,059 $ 23,955,852 $ 20,520,660 Deferred income taxes on the balance sheet result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. Significant components of the Company’s deferred tax assets and liabilities were as follows at December 31: 2015 2014 Deferred tax assets: Stock-based compensation $ 2,175,291 $ 1,836,673 Amortization of internal use software development costs 1,999,641 1,755,520 Federal benefit of state uncertain tax positions 1,110,917 767,867 Accrued vacation 894,591 854,463 State net operating loss carryforwards 457,485 341,794 Deferred rent 233,326 224,187 Allowance for doubtful accounts 178,015 184,675 Other 326,138 48,529 7,375,404 6,013,708 Less: Valuation allowance (412,821 ) (332,863 ) Total 6,962,583 5,680,845 Deferred tax liabilities: Depreciation & capitalized internal use software and development costs (4,421,900 ) (5,056,061 ) Nonrecurring gain on acquisition of business (1,119,230 ) (1,121,326 ) Total (5,541,130 ) (6,177,387 ) Net deferred tax asset (liability) $ 1,421,453 $ (496,542 ) The Company has identified certain estimated state net operating loss (“NOL”) carryforwards that it might be unable to use. Based on a review of applicable state tax statutes, the Company concluded that there is substantial doubt it would be able to realize the full amount of certain estimated NOL carryforwards in states where the Company cannot file a consolidated income tax return or where future taxable income will not be sufficient to utilize the state NOL before it expires. As a result, the Company recorded a deferred tax asset valuation allowance totaling approximately $0.4 million and $0.3 million respectively at December 31, 2015 and 2014. The Company’s net deferred tax asset at December 31, 2015 is primarily attributable to cumulative timing differences between book and tax stock-based compensation expense. The Company’s net deferred tax liability at December 31, 2014 is primarily attributable to timing differences between book and tax depreciation on property and equipment purchased during 2014 and 2013. See Note 10 for discussion of the accounting for income tax deductions relating to the vesting of restricted stock. The following table reconciles the statutory federal income tax rate and the effective income tax rate indicated by the consolidated statements of income: Year Ended December 31, 2015 2014 2013 Statutory federal income tax rate 35.0 % 35.0 % 35.0 % State income taxes 2.1 2.2 3.2 Nondeductible expenses 1.0 1.2 1.4 Uncertain tax positions 0.9 1.1 1.2 Federal and state tax credits (1.2 ) (1.2 ) (2.0 ) Other (0.2 ) (0.3 ) 0.2 Effective federal and state income tax rate 37.6 % 38.0 % 39.0 % On December 18, 2015, the Protecting Americans from Tax Hikes Act (the “2015 Act”) was signed into law. The 2015 Act includes a provision making permanent the federal research and development credit (which previously expired at the end of 2014). For the 2015 tax year, the Company recognized a favorable benefit related to the federal research and development tax credit totaling approximately $0.4 million, which was recognized by the Company in the fourth quarter of 2015, the period in which the legislation was enacted. On December 19, 2014, the Tax Increase Prevention Act of 2014 (the “2014 Act”) was signed into law. The 2014 Act retroactively extended the federal research and development credit (which previously expired at the end of 2013). For the 2014 tax year, the Company recognized a favorable benefit related to the federal research and development tax credit totaling approximately $0.4 million, which was recognized by the Company in the fourth quarter of 2014, the period in which the legislation was enacted. On January 2, 2013, the American Taxpayer Relief Act of 2012 (the “2012 Act”) was signed into law. The 2012 Act retroactively extended the federal research and development credit (which previously expired at the end of 2011) through the end of 2013. In accordance with authoritative accounting guidance, the Company recognized the impact of this legislation for the 2012 tax year in 2013, when the Act was signed into law. For the 2013 and 2012 tax years, the Company recognized a favorable benefit related to the federal research and development tax credit totaling approximately $0.8 million, which was recognized in 2013. The following table provides a reconciliation of the beginning and ending amount of the consolidated liability for unrecognized income tax benefits (included in other long-term liabilities in the consolidated balance sheets) for the years ended December 31, 2015, 2014 and 2013: 2015 2014 2013 Balance at January 1 $ 2,797,671 $ 1,760,434 $ 688,575 Additions for tax positions of current years 1,093,963 1,072,333 632,309 Additions for tax positions of prior years 338,123 112,459 439,550 Expiration of the statute of limitations (365,762 ) (126,918 ) - Reductions for tax positions of prior years (142,973 ) (20,637 ) - Balance at December 31 $ 3,721,022 $ 2,797,671 $ 1,760,434 At December 31, 2015, 2014 and 2013, there were approximately $2.6 million, $2.0 million and $1.3 million, respectively, of unrecognized tax benefits that if recognized would affect the annual effective tax rate. It is reasonably possible that events will occur during the next 12 months that would cause the total amount of unrecognized tax benefits to increase or decrease. However, the Company does not expect such increases or decreases to be material to its financial condition or results of operations. The Company, along with its wholly owned subsidiaries, files a consolidated U.S. federal income tax return and separate income tax returns in many states throughout the U.S. The Company remains subject to U.S. federal examination for the tax years ended on or after December 31, 2013. State income tax returns are generally subject to examination for a period of three to five years after filing of the respective return. The Company recognizes accrued interest and penalties associated with uncertain tax positions as part of income tax expense in the consolidated statements of income. At December 31, 2015, 2014 and 2013, accrued interest and penalty amounts were not material. |
STOCK-BASED COMPENSATION AND EM
STOCK-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2015 | |
STOCK-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS | 10. STOCK-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS The following table presents stock-based compensation expense included in the Company’s consolidated statements of income: Year Ended December 31, 2015 2014 2013 Cost of portal revenues, exclusive of depreciation & amortization $ 1,404,093 $ 1,311,827 $ 1,100,396 Cost of software & services revenues, exclusive of depreciation & amortization 82,814 47,105 48,128 Selling & administrative 4,953,934 4,744,966 2,877,436 Stock-based compensation expense before income taxes 6,440,841 6,103,898 4,025,960 Income tax benefit (2,423,029 ) (2,320,499 ) (1,571,867 ) Net stock-based compensation expense $ 4,017,812 $ 3,783,399 $ 2,454,093 Stock option and restricted stock plans The Company has a formal stock compensation plan (the “NIC plan”) to provide for the granting of incentive stock options, non-qualified stock options, or restricted stock awards to encourage certain employees of the Company and its subsidiaries, and directors of the Company to participate in the ownership of the Company and to provide additional incentive for such employees and directors to promote the success of its business through sharing in the future growth of such business. The NIC plan was amended and restated in May 2014. The May 2014 amendment and restatement, as approved by the Company’s Board of Directors and stockholders, modified the NIC plan to increase the number of shares the Company is authorized to grant under the NIC plan from 14,286,754 to 15,825,223 common shares. At December 31, 2015, a total of 4,681,841 shares were available for future grants under the NIC plan. The Company did not grant any stock options in 2015, 2014, or 2013, and does not currently anticipate granting stock options in the future. Instead, the Company currently expects to continue to grant only restricted stock awards. Restricted stock During 2015, the Board of Directors of the Company granted to certain management-level employees and executive officers, service-based restricted stock awards totaling 273,327 shares with a grant-date fair value totaling approximately $4.6 million. Such restricted stock awards vest beginning one year from the date of grant in annual installments of 25%. In addition, non-employee directors of the Company were granted service-based restricted stock awards totaling 45,619 shares with a grant-date fair value totaling approximately $0.8 million. Such restricted stock awards vest one year from the date of grant. During 2015, the Board of Directors of the Company also granted to certain executive officers performance-based restricted stock awards pursuant to the terms of the Company’s executive compensation program totaling 109,705 shares with a grant-date fair value totaling approximately $1.9 million, which represents the maximum number of shares able to be earned by the executive officers at the end of a three-year performance period ending December 31, 2017. The actual number of shares earned will be based on the Company’s performance related to the following performance criteria over the performance period: ● ● ● Cash flow return on invested capital, excluding income taxes paid (three-year average). At the end of the three-year period, the executive officers are eligible to receive up to a specified number of shares based upon the Company’s performance relative to these performance criteria over the performance period. In addition, the executive officers will accrue dividend equivalents for any cash dividend declared during the performance period, payable in the form of shares of Company common stock, based upon the maximum number of shares to be earned by the executive officers for each performance-based restricted stock award. Such hypothetical cash dividend payment shall be divided by the fair value of the Company’s common stock on the dividend payment date to determine the maximum number of notional shares to be awarded. At the end of the three-year performance period and on the date some or all of the shares are paid under the agreement, a pro rata number of notional dividend shares will be converted into an equivalent number of dividend shares paid and granted to the executive officers based upon the actual number of underlying shares earned during the performance period. At December 31, 2015, the three-year performance period related to the performance-based restricted stock awards granted to certain executive officers on February 5, 2013 ended. Based on the Company’s actual financial results from 2013 through 2015, 96,732 of the shares subject to the awards and 6,990 dividend shares were earned and vested on February 5, 2016. At December 31, 2014, the three-year performance period related to the performance-based restricted stock awards granted to certain executive officers on January 30, 2012 ended. Based on the Company’s actual financial results from 2012 through 2014, 67,239 of the shares subject to the awards and 4,043 dividend shares were earned and vested on January 30, 2015. At December 31, 2013, the three-year performance period related to the performance-based restricted stock awards granted to certain executive officers on March 7, 2011 ended. Based on the Company’s actual financial results from 2011 through 2013, 85,365 of the shares subject to the awards and 4,350 dividend shares were earned and vested on March 7, 2014. A summary of restricted stock activity for the year ended December 31, 2015 is presented below: Restricted Shares Weighted Average Grant Date Fair Value Outstanding at January 1, 2015 993,453 $ 16.28 Granted 432,694 16.80 Vested (364,380 ) 15.02 Canceled (136,737 ) 15.27 Outstanding at December 31, 2015 925,030 17.17 The fair value of restricted stock vested during the years ended December 31, 2015, 2014 and 2013 was approximately $5.5 million, $4.1 million and $3.5 million, respectively. The weighted average grant date fair value per share of restricted stock granted during the years ended December 31, 2015, 2014 and 2013 was $16.80, $19.05 and $16.54, respectively. At December 31, 2015, the Company had approximately $6.9 million of total unrecognized compensation cost, net of estimated forfeitures, related to nonvested restricted stock awards. The Company expects to recognize this cost over the next 2.4 years from December 31, 2015. As previously disclosed in prior filings with the SEC, the Company’s former Executive Vice President, Chief Administrative Officer, General Counsel and Secretary (“EVP”), retired effective December 31, 2015. In connection with the EVP’s retirement, the Compensation Committee of the Board of Directors of the Company authorized the accelerated vesting of a portion of the EVP’s unvested service-based restricted stock representing 21,813 shares. The EVP forfeited his remaining balance of 5,269 shares of unvested service-based restricted stock and 33,651 shares of performance-based restricted stock, granted in 2014 and 2015, upon his retirement. The incremental cost to the Company to accelerate the vesting of a portion the EVP’s unvested service-based restricted stock, net of all performance-based and service-based restricted stock forfeited upon his retirement, was insignificant. Income taxes The Company is permitted to recognize a credit to additional paid-in capital for federal income tax deductions, or windfall tax benefits, resulting from the vesting of restricted stock if such windfall tax benefits reduce income taxes payable. Following the with-and-without approach for utilization of tax attributes, the Company increased additional paid-in capital for windfall tax benefits totaling approximately $0.4 million, $1.2 million and $1.3 million, respectively, during the years ended December 31, 2015, 2014 and 2013. Earnings per share In calculating diluted earnings per share, the assumed proceeds in the treasury stock calculation are adjusted for any restricted stock windfall tax benefits or shortfalls that would be credited or debited, respectively, to additional paid-in capital. Upon adoption of authoritative accounting guidance for share-based payments, the Company elected to exclude the impact of pro forma deferred tax assets (i.e., the windfall or shortfall that would be recognized in the financial statements upon exercise of an award) when calculating diluted earnings per share. Employee stock purchase plan In 1999, the Company’s Board of Directors approved an employee stock purchase plan (“ESPP”) intended to qualify as an “employee stock purchase plan” under Section 423 of the Internal Revenue Code. A total of 2,321,688 shares of NIC common stock have been reserved for issuance under this plan. Terms of the plan permit eligible employees to purchase NIC common stock through payroll deductions up to the lesser of 15% of each employee’s compensation or $25,000. Amounts deducted and accumulated by the participant are used to purchase shares of NIC’s common stock at 85% of the lower of the fair value of the common stock at the beginning or the end of the offering period, as defined in the plan. In the offering period commencing on April 1, 2014 and ending on March 31, 2015, 75,328 shares were purchased at a price of $15.02 per share, resulting in total cash proceeds to the Company of approximately $1.1 million. In the offering period commencing on April 1, 2013 and ending on March 31, 2014, 68,101 shares were purchased at a price of $16.25 per share, resulting in total cash proceeds to the Company of approximately $1.1 million. In the offering period commencing on April 1, 2012 and ending on March 31, 2013, 87,578 shares were purchased at a price of $10.33 per share, resulting in total cash proceeds to the Company of approximately $0.9 million. The next offering period under this plan commenced on April 1, 2015. The closing fair market value of NIC common stock on the first day of the current offering period was $17.48 per share. The fair values of the offerings were estimated on the dates of grant using the Black-Scholes model using the assumptions in the following table. March 31, 2016 Offering March 31, 2015 Offering March 31, 2014 Offering Risk-free interest rate 0.27 % 0.13 % 0.14 % Expected dividend yield 3.07 % 3.08 % 3.73 % Expected life 1.0 year 1.0 year 1.0 year Expected stock price volatility 37.86 % 35.97 % 28.84 % Weighted average fair value of ESPP rights $ 4.88 $ 5.38 $ 4.59 The Black-Scholes option-pricing model was not developed for use in valuing employee ESPP rights, but was developed for use in estimating the fair value of traded stock options that have no vesting restrictions and are fully transferable. In addition, it requires the use of subjective assumptions including expectations of future dividends and stock price volatility. Such assumptions are only used for making the required fair value estimate and should not be considered as indicators of future dividend policy or stock price appreciation, or should not be used to predict the value ultimately realized by employees who receive equity awards. Because changes in the subjective assumptions can materially affect the fair value estimate and because employee stock options have characteristics significantly different from those of traded options, the use of the Black-Scholes option-pricing model may not provide a reliable estimate of the fair value of employee ESPP rights. Defined contribution 401(k) profit sharing plan The Company and its subsidiaries sponsor a defined contribution 401(k) profit sharing plan. In accordance with the plan, all full-time employees are eligible immediately upon employment and non-full time employees are eligible upon reaching 1,000 hours of service in the relevant period. A discretionary match by the Company of an employee’s contribution of up to 5% of base salary and a discretionary contribution may be made to the plan as determined by the Board of Directors. Expense related to Company matching contributions totaled approximately $2.2 million, $2.1 million and $1.8 million for the years ended December 31, 2015, 2014 and 2013, respectively. |
REPORTABLE SEGMENTS AND RELATED
REPORTABLE SEGMENTS AND RELATED INFORMATION | 12 Months Ended |
Dec. 31, 2015 | |
REPORTABLE SEGMENTS AND RELATED INFORMATION | 11. REPORTABLE SEGMENTS AND RELATED INFORMATION The Outsourced Portals segment is the Company’s only reportable segment and generally includes the Company’s subsidiaries operating outsourced state and local government portals. The Other Software & Services category primarily includes the Company’s subsidiaries that provide software development and digital government services, other than outsourced portal services, to state and local governments as well as federal agencies. Each of the Company’s businesses within the Other Software & Services category is an operating segment and has been grouped together to form the Other Software & Services category, as none of the operating segments meets the quantitative threshold of a separately reportable segment. Beginning in the fourth quarter of 2015, certain corporate divisions that support the Company’s portal businesses, which were previously reported in the Outsourced Portals segment, are now reported with all other corporate divisions as unallocated corporate-level expenses and reported in the reconciliation of the segments totals to the related consolidated totals as “Other Reconciling Items.” The new presentation is consistent with the manner by which information is presently used internally by the Company’s chief operating decision maker to evaluate performance and make resource allocation decisions. All prior periods presented have been recast to conform to the current segment reporting. These changes had no impact on total consolidated revenues, total operating expenses or total operating income before income taxes. There have been no significant intersegment transactions for the periods reported. The summary of significant accounting policies applies to all reportable and operating segments. The measure of profitability by which management, including the Company’s chief operating decision maker, evaluates the performance of its segments and allocates resources to them is operating income (loss) before income taxes. Segment assets or other segment balance sheet information is not presented to the Company’s chief operating decision maker. Accordingly, the Company has not presented information relating to segment assets. The table below reflects summarized financial information for the Company’s reportable and operating segments for the years ended December 31: Outsourced Portals Other Software & Services Other Reconciling Items Consolidated Total 2015 Revenues $ 273,502,323 $ 18,873,973 $ - $ 292,376,296 Costs & expenses 168,166,011 5,431,967 43,098,323 216,696,301 Depreciation & amortization 4,648,870 47,015 3,689,528 8,385,413 Operating income (loss) before income taxes $ 100,687,442 $ 13,394,991 $ (46,787,851 ) $ 67,294,582 2014 Revenues $ 255,743,418 $ 16,353,153 $ - $ 272,096,571 Costs & expenses 156,185,335 4,783,606 38,936,541 199,905,482 Depreciation & amortization 5,305,302 36,999 3,834,717 9,177,018 Operating income (loss) before income taxes $ 94,252,781 $ 11,532,548 $ (42,771,258 ) $ 63,014,071 2013 Revenues $ 235,183,005 $ 14,095,660 $ - $ 249,278,665 Costs & expenses 147,007,246 4,498,233 36,881,346 188,386,825 Depreciation & amortization 4,962,692 53,475 3,316,922 8,333,089 Operating income (loss) before income taxes $ 83,213,067 $ 9,543,952 $ (40,198,268 ) $ 52,558,751 The highest volume, most commercially valuable service the Company offers is access to motor vehicle driver history records, referred to as DHR, through the Company’s outsourced government portals. This service accounted for approximately 35%, 35% and 34% of the Company’s total consolidated revenues in 2015, 2014 and 2013, respectively. In addition, the Company offers a service in several states for online motor vehicle registration and licensing. This service accounted for approximately 13%, 12% and 13% of the Company’s total consolidated revenues in 2015, 2014 and 2013, respectively. No other services accounted for 10% or more of the Company’s total consolidated revenues for the years ended December 31, 2015, 2014 or 2013. A primary source of revenue is derived from data resellers, who use the Company’s government portals to access DHR records for the auto insurance industry. For the years ended December 31, 2015, 2014 and 2013, one of these data resellers accounted for approximately 23%, 24% and 22% of the Company’s total consolidated revenues, respectively. At December 31, 2015 and 2014, this one data reseller accounted for approximately 17% and 24%, respectively, of the Company’s accounts receivable. For the years ended December 31, 2015, 2014 and 2013, the Company’s Texas portal accounted for approximately 21%, 22% and 23% of the Company’s total consolidated revenues, respectively. No other state portal contract accounted for more than 10% of the Company’s total consolidated revenues for the years ended December 31, 2015, 2014 or 2013. |
UNAUDITED QUARTERLY OPERATING R
UNAUDITED QUARTERLY OPERATING RESULTS | 12 Months Ended |
Dec. 31, 2015 | |
UNAUDITED QUARTERLY OPERATING RESULTS | 12. UNAUDITED QUARTERLY OPERATING RESULTS The unaudited quarterly information below is subject to seasonal fluctuations resulting in lower portal revenues in the fourth quarter of each calendar year (on an individual portal basis, and excluding revenues from new outsourced government portal contracts awarded or acquired during the year), due to the lower number of business days in the quarter and a lower volume of business-to-government and citizen-to-government transactions during the holiday periods. 2015 Three Months Ended Year Ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 December 31, 2015 Revenues: Portal revenues $ 65,913,898 $ 71,030,846 $ 70,122,162 $ 66,435,417 $ 273,502,323 Software & services revenues 4,444,725 4,781,930 4,924,120 4,723,198 18,873,973 Total revenues 70,358,623 75,812,776 75,046,282 71,158,615 292,376,296 Operating expenses: Cost of portal revenues, exclusive of depreciation & amortization 41,494,301 42,815,102 41,057,942 42,798,666 168,166,011 Cost of software & services revenues, exclusive of depreciation & amortization 1,289,860 1,321,259 1,364,726 1,456,122 5,431,967 Selling & administrative 10,537,491 10,818,680 10,576,445 11,165,707 43,098,323 Depreciation & amortization 2,292,118 2,303,571 2,116,319 1,673,405 8,385,413 Total operating expenses 55,613,770 57,258,612 55,115,432 57,093,900 225,081,714 Operating income before income taxes 14,744,853 18,554,164 19,930,850 14,064,715 67,294,582 Income tax provision 5,803,949 7,250,724 7,180,660 5,080,726 25,316,059 Net income $ 8,940,904 $ 11,303,440 $ 12,750,190 $ 8,983,989 $ 41,978,523 Basic net income per share $ 0.14 $ 0.17 $ 0.19 $ 0.13 $ 0.63 Diluted net income per share $ 0.14 $ 0.17 $ 0.19 $ 0.13 $ 0.63 Weighted average shares outstanding: Basic 65,387,427 65,587,822 65,617,812 65,621,684 65,554,655 Diluted 65,387,427 65,587,822 65,636,436 65,715,951 65,639,682 2014 Three Months Ended Year Ended March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 December 31, 2014 Revenues: Portal revenues $ 61,482,452 $ 66,807,907 $ 65,304,664 $ 62,148,395 $ 255,743,418 Software & services revenues 3,915,233 4,345,879 4,222,534 3,869,507 16,353,153 Total revenues 65,397,685 71,153,786 69,527,198 66,017,902 272,096,571 Operating expenses: Cost of portal revenues, exclusive of depreciation & amortization 37,559,503 39,550,094 39,090,865 39,984,873 156,185,335 Cost of software & services revenues, exclusive of depreciation & amortization 993,324 1,244,843 1,287,083 1,258,356 4,783,606 Selling & administrative 9,208,685 9,840,579 10,396,876 9,490,401 38,936,541 Depreciation & amortization 2,249,734 2,277,048 2,292,382 2,357,854 9,177,018 Total operating expenses 50,011,246 52,912,564 53,067,206 53,091,484 209,082,500 Operating income before income taxes 15,386,439 18,241,222 16,459,992 12,926,418 63,014,071 Income tax provision 6,010,054 7,213,057 6,098,567 4,634,174 23,955,852 Net income $ 9,376,385 $ 11,028,165 $ 10,361,425 $ 8,292,244 $ 39,058,219 Basic net income per share $ 0.14 $ 0.17 $ 0.16 $ 0.12 $ 0.59 Diluted net income per share $ 0.14 $ 0.17 $ 0.16 $ 0.12 $ 0.59 Weighted average shares outstanding: Basic 65,056,725 65,244,575 65,287,702 65,301,797 65,223,549 Diluted 65,056,725 65,244,575 65,287,702 65,363,104 65,277,758 |
SUMMARY OF SIGNIFICANT ACCOUN19
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Basis of presentation | Basis of presentation The Company classifies its revenues and cost of revenues into two categories: (1) portal and (2) software & services. The portal category generally includes revenues and cost of revenues from the Company’s subsidiaries operating outsourced portals on behalf of state and local governments. The software & services category primarily includes revenues and cost of revenues from the Company’s subsidiaries that provide software development and services, other than outsourced portal services, to state and local governments as well as federal agencies. The primary categories of operating expenses include: cost of portal revenues, cost of software & services revenues, selling & administrative and depreciation & amortization. Cost of portal revenues consists of all direct costs associated with operating government portals on an outsourced basis including employee compensation and benefits (including stock-based compensation), fees required to process credit/debit card and automated clearinghouse transactions, subcontractor labor costs, telecommunications, provision for losses on accounts receivable, gains and losses on disposal of assets and all other costs associated with the provision of dedicated client service such as dedicated facilities. |
Basis of consolidation | Basis of consolidation The accompanying consolidated financial statements consolidate the Company together with all of its direct and indirect wholly owned subsidiaries. All intercompany balances and transactions have been eliminated. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents primarily include cash on hand in the form of bank deposits. For purposes of the consolidated balance sheets and consolidated statements of cash flows, the Company considers all non-restricted highly liquid instruments purchased with an original maturity of one month or less to be cash equivalents. |
Cash restricted for payment of dividend | Cash restricted for payment of dividend Restricted cash represents cash which is restricted for use by NIC. On November 2, 2015, the Company’s Board of Directors declared a special cash dividend of $0.55 per share, payable to stockholders of record as of November 13, 2015. The dividend, totaling approximately $36.5 million, was paid on January 4, 2016 out of the Company’s available cash. Cash used to pay the special dividend was classified as restricted at December 31, 2015. |
Trade accounts receivable | Trade accounts receivable The Company records trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts. The Company calculates this allowance based on its history of write-offs, the level of past-due accounts, and its relationship with, and the economic status of, its customers. Trade accounts receivable are written off when deemed uncollectible. Recoveries of receivables previously written off are recorded when received. As previously disclosed in prior filings with the SEC, in September 2013, the Company elected not to pursue collection of outstanding accounts receivable from the Commonwealth of Pennsylvania (the “Commonwealth”) and recorded a non-cash pre-tax charge of approximately $5.1 million (approximately $0.05 per share on an after-tax basis) in the third quarter of 2013 to write-off amounts due from the Commonwealth through June 30, 2013. The charge is included in cost of portal revenues in the Company’s consolidated statements of income for the year ended December 31, 2013. The Company continued to provide eGovernment solutions under the contract with the Commonwealth, but did not recognize revenues under the contract subsequent to June 30, 2013 until the contract became self-funded in October 2013. The Company’s allowance for doubtful accounts at both December 31, 2015 and 2014 was approximately $0.5 million. |
Property and equipment | Property and equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over estimated useful lives of 8 years for furniture and fixtures, 3-10 years for equipment, 3-5 years for purchased software, and the lesser of the term of the lease or 5 years for leasehold improvements. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in results of operations for the period. The cost of maintenance and repairs is charged to expense as incurred. Significant betterments are capitalized. The Company periodically evaluates the carrying value of property and equipment to be held and used when events and circumstances warrant such a review. The carrying value of property and equipment is considered impaired when the anticipated undiscounted cash flow from the asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the asset. Fair value is determined primarily using the anticipated cash flow discounted at a rate commensurate with the risk involved. Losses on assets to be disposed of are determined in a similar manner, except that fair values are reduced for the cost to dispose. The Company did not record any material impairment losses on property and equipment during the periods presented. |
Software development costs and intangible assets | Software development costs and intangible assets The Company expenses as incurred all employee costs to start up, operate, and maintain government portals on an outsourced basis as costs of performance under the contracts because, after the completion of a defined contract term, the government entity with which the Company contracts typically receives a perpetual, royalty-free license to the applications the Company developed, excluding applications provided on a SaaS basis. Such costs are included in cost of portal revenues in the consolidated statements of income. The Company accounts for the costs of developing internal use computer software in accordance with authoritative accounting guidance for internal use computer software, whereby certain costs of developing internal use computer software are capitalized and amortized over their estimated useful life. For internal use computer software, the estimated economic life is typically 36 months from the date the software is placed in production. At December 31, 2015 and 2014, such costs are included in intangible assets in the consolidated balance sheets. The Company carries intangible assets at cost less accumulated amortization. Intangible assets are generally amortized on a straight-line basis over estimated economic lives of the respective assets. At each balance sheet date, or whenever events or changes in circumstances warrant, the Company assesses the carrying value of intangible assets for possible impairment based primarily on the ability to recover the balances from expected future cash flows on an undiscounted basis. If the sum of the expected future cash flows on an undiscounted basis were to be less than the carrying amount of the intangible asset, an impairment loss would be recognized for the amount by which the carrying value of the intangible asset exceeds its estimated fair value. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. The Company has not recorded any material impairment losses on intangible assets during the periods presented. |
Accrued expenses | Accrued expenses As of each balance sheet date, the Company estimates expenses which have been incurred but not yet paid or for which invoices have not yet been received. Significant components of accrued expenses consist primarily of employee compensation and benefits (including incentive compensation, bonuses, vacation, health insurance and employer 401(k) contributions), third-party professional service fees, payment processing fees, and miscellaneous other accruals. |
Revenue recognition | Revenue recognition Portal revenues The Company recognizes revenue from providing outsourced digital government services (primarily transaction-based information access fees and filing fees) net of the transaction fees due to the government when the services are provided at the time of the transactions. The fees that the Company must remit to state agencies for data access and other statutory fees are accrued as accounts payable when the services are provided at the time of the transactions. The Company must remit a certain amount or percentage of these fees to government agencies regardless of whether the Company ultimately collects the fees. As a result, trade accounts receivable and accounts payable reflect the gross amounts outstanding at the balance sheet dates. Revenue from service contracts to provide portal consulting, application development, and management services to governments is recognized as the services are provided at rates provided for in the contract. Amounts received prior to providing services are recorded as unearned revenue. At each balance sheet date, the Company makes a determination as to the portion of unearned revenue that will be earned within one year and records that amount in other current liabilities in the consolidated balance sheets. The remainder, if any, is recorded in other long-term liabilities. Unearned revenues at December 31, 2015 and 2014 were approximately $0.9 million and $1.3 million, respectively, and were recorded in other current liabilities in the consolidated balance sheets. Software & services revenues The Company’s software & services revenues primarily include revenues from subsidiaries that provide software development and services, other than outsourced portal services, to state and local governments as well as federal agencies. The Company’s subsidiary, NIC Federal, LLC (“NIC Federal”) currently earns a significant portion of its revenues from its contract with the Federal Motor Carrier Safety Administration (“FMCSA”) to develop and manage the FMCSA’s Pre-Employment Screening Program (“PSP”) for motor carriers nationwide, using a self-funded, transaction-based business model. NIC Federal recognizes revenue from its contract with the FMCSA (primarily transaction-based information access fees) when the services are provided at the time of the transactions. NIC Federal also earns a portion of its revenues from fixed fee and time and materials application development and outsourced maintenance contracts with other government agencies and recognizes revenues as the services are provided. |
Stock-based compensation | Stock-based compensation The Company measures stock-based compensation cost for service-based restricted stock awards at the grant date based on the calculated fair value of the award, and recognizes an expense over the employee’s requisite service period (generally the vesting period of the grant). The Company measures stock-based compensation cost for performance-based restricted stock awards at the date of grant, based on the fair value of shares expected to be earned at the end of the performance period, and recognizes an expense over the performance period based upon the probable number of shares expected to vest. The Company estimates and excludes compensation cost related to awards not expected to vest based upon estimated forfeitures (See Note 10). |
Income taxes | Income taxes The Company, along with its wholly owned subsidiaries, files a consolidated federal income tax return. Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end based on enacted laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized. The Company does not recognize a tax benefit for uncertain tax positions unless management’s assessment concludes that it is “more likely than not” that the position is sustainable, based on its technical merits. If the recognition threshold is met, the Company recognizes a tax benefit based upon the largest amount of the tax benefit that is greater than 50% likely to be realized. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense in the consolidated statements of income. |
Fair value of financial instruments | Fair value of financial instruments The carrying values of the Company’s accounts receivable and accounts payable approximate fair value. |
Comprehensive income | Comprehensive income The Company has no components of other comprehensive income or loss and, accordingly, the Company’s comprehensive income is the same as its net income for all periods presented. |
Earnings per share | Earnings per share Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are considered participating securities and are included in the computation of earnings per share pursuant to the two-class method for all periods presented. The two-class method is an earnings allocation formula that treats a participating security as having rights to undistributed earnings that would otherwise have been available to common stockholders. The Company’s service-based restricted stock awards contain non-forfeitable rights to dividends and are considered participating securities. Accordingly, service-based restricted stock awards were included in the calculation of earnings per share using the two-class method for all periods presented. Unvested service-based restricted shares totaled approximately 0.6 million, 0.6 million and 0.7 million, respectively, at December 31, 2015, 2014 and 2013. Basic earnings per share is calculated by first allocating earnings between common stockholders and participating securities. Earnings attributable to common stockholders are divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by giving effect to dilutive potential common shares outstanding during the period. The dilutive effect of shares related to the Company’s employee stock purchase plan is determined based on the treasury stock method. The dilutive effect of service-based restricted stock awards is based on the more dilutive of the treasury stock method or the two-class method assuming a reallocation of undistributed earnings to common stockholders after considering the dilutive effect of potential common shares other than the participating unvested restricted stock awards. The dilutive effect of performance-based restricted stock awards is based on the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share: December 31, 2015 2014 2013 Numerator: Net income $ 41,978,523 $ 39,058,219 $ 32,038,091 Less: Income allocated to participating securities (384,246 ) (368,668 ) (325,182 ) Net income available to common stockholders $ 41,594,277 $ 38,689,551 $ 31,712,909 Denominator: Weighted average shares - basic 65,554,655 65,223,549 64,888,978 Performance-based restricted stock awards 85,027 54,209 65,388 Weighted average shares - diluted 65,639,682 65,277,758 64,954,366 Basic net income per share: Net income $ 0.63 $ 0.59 $ 0.49 Diluted net income per share: Net income $ 0.63 $ 0.59 $ 0.49 |
Concentration of credit risk | Concentration of credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and accounts receivable. The Company limits its exposure to credit loss by depositing its cash with high credit quality financial institutions and monitoring the financial stability of those institutions. The Federal Deposit Insurance Corporation (“FDIC”) provides deposit insurance coverage up to $250,000 per depositor for deposit accounts at each FDIC-insured depository institution. At December 31, 2015, the amount of cash covered by FDIC deposit insurance was approximately $10.2 million, and approximately $88.2 million of cash was above the FDIC deposit insurance limit. The Company performs ongoing credit evaluations of its customers and generally requires no collateral to secure accounts receivable. |
Segment reporting | Segment reporting The Company reports segment information in accordance with authoritative accounting guidance for segment disclosures based upon the “management” approach, which designates the internal organization that is used by management for making operating decisions and assessing performance as the source of the Company’s segments. Authoritative guidance for segment disclosures also requires disclosures about products and services and major customers (See Note 11). |
Use of estimates | Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Recent Accounting Pronouncements | Recently adopted accounting pronouncements In November 2015, the Financial Accounting Standards Board (“FASB”) issued new authoritative literature, Balance Sheet Classification of Deferred Taxes, to simplify the financial statement presentation of deferred taxes in the balance sheet. The standard requires that all deferred tax assets and liabilities be classified as noncurrent. The standard is effective for the annual reporting period beginning January 1, 2017, including interim periods within that reporting period, and early adoption is permitted as of the beginning of any interim or annual reporting period. The standard may be adopted either prospectively to all deferred tax assets and liabilities or retrospectively to all periods presented. The Company adopted the standard on a retrospective basis effective for the year ended December 31, 2015. The adoption of the standard resulted in a decrease in current net deferred tax assets of approximately $1.0 million and a corresponding decrease in noncurrent net deferred tax liabilities in the Company’s consolidated balance sheet at December 31, 2014. Recently issued accounting pronouncements In May 2014, the FASB issued new authoritative literature, Revenue from Contracts with Customers, as part of a joint effort by the FASB and the International Accounting Standards Board to enhance financial reporting by creating common revenue recognition guidance and thereby improve the consistency of requirements, comparability of practices and usefulness of disclosures. The new standard will supersede much of the existing authoritative literature for revenue recognition. The standard and related amendments will be effective for the Company for its annual reporting period beginning January 1, 2018, including interim periods within that reporting period. Entities are allowed to transition to the new standard by either recasting prior periods presented or recognizing the cumulative effect of the change in accounting principle in beginning stockholders’ equity. The Company is currently evaluating the newly issued guidance, including which transition approach will be applied and the estimated impact it will have on the Company’s consolidated financial statements. |
SUMMARY OF SIGNIFICANT ACCOUN20
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share: December 31, 2015 2014 2013 Numerator: Net income $ 41,978,523 $ 39,058,219 $ 32,038,091 Less: Income allocated to participating securities (384,246 ) (368,668 ) (325,182 ) Net income available to common stockholders $ 41,594,277 $ 38,689,551 $ 31,712,909 Denominator: Weighted average shares - basic 65,554,655 65,223,549 64,888,978 Performance-based restricted stock awards 85,027 54,209 65,388 Weighted average shares - diluted 65,639,682 65,277,758 64,954,366 Basic net income per share: Net income $ 0.63 $ 0.59 $ 0.49 Diluted net income per share: Net income $ 0.63 $ 0.59 $ 0.49 |
OUTSOURCED GOVERNMENT CONTRAC21
OUTSOURCED GOVERNMENT CONTRACTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Enterprise-Wide Portal Outsourcing Services to Multiple Governments Agencies | The following is a summary of the portals in each state through which the Company provides enterprise-wide outsourced portal services to multiple government agencies: NIC Portal Entity Portal Website (State) Year Services Commenced Contract Expiration Date (Renewal Options Through) Connecticut Interactive, LLC www.ct.gov (Connecticut) 2014 1/9/2017 (1/9/2020) Wisconsin Interactive Network, LLC www.wisconsin.gov (Wisconsin) 2013 5/13/2018 (5/13/2023) Pennsylvania Interactive, LLC www.pa.gov (Pennsylvania) 2012 11/30/2017 (11/30/2022) NICUSA, OR Division www.oregon.gov (Oregon) 2011 11/22/2021 NICUSA, MD Division www.maryland.gov (Maryland) 2011 8/10/2017 (8/10/2019) Mississippi Interactive, LLC www.ms.gov (Mississippi) 2011 12/31/2017 (12/31/2021) New Jersey Interactive, LLC www.nj.gov (New Jersey) 2009 5/1/2020 (5/1/2022) Texas NICUSA, LLC www.Texas.gov (Texas) 2009 8/31/2018 West Virginia Interactive, LLC www.WV.gov (West Virginia) 2007 3/31/2016 Vermont Information Consortium, LLC www.Vermont.gov (Vermont) 2006 6/8/2016 (6/8/2019) Colorado Interactive, LLC www.Colorado.gov (Colorado) 2005 4/30/2019 (4/30/2023) South Carolina Interactive, LLC www.SC.gov (South Carolina) 2005 7/15/2019 (7/15/2021) Kentucky Interactive, LLC www.Kentucky.gov (Kentucky) 2003 8/31/2016 Alabama Interactive, LLC www.Alabama.gov (Alabama) 2002 3/1/2016 (3/1/2017) Rhode Island Interactive, LLC www.RI.gov (Rhode Island) 2001 7/1/2017 (7/1/2019) Oklahoma Interactive, LLC www.OK.gov (Oklahoma) 2001 3/31/2016 (3/31/2020) Montana Interactive, LLC www.MT.gov (Montana) 2001 12/31/2017 (12/31/2020) NICUSA, TN Division www.TN.gov (Tennessee) 2000 3/31/2017 Hawaii Information Consortium, LLC www.eHawaii.gov (Hawaii) 2000 1/3/2019 (3-year renewal options) Idaho Information Consortium, LLC www.Idaho.gov (Idaho) 2000 6/30/2017 Utah Interactive, LLC www.Utah.gov (Utah) 1999 6/5/2019 Maine Information Network, LLC www.Maine.gov (Maine) 1999 7/1/2018 Arkansas Information Consortium, LLC www.Arkansas.gov (Arkansas) 1997 6/30/2018 Iowa Interactive, LLC www.Iowa.gov (Iowa) 1997 6/30/2016 (6/30/2020) Indiana Interactive, LLC www.IN.gov (Indiana) 1995 7/31/2016 Nebraska Interactive, LLC www.Nebraska.gov (Nebraska) 1995 4/1/2019 (4/1/2021) Kansas Information Consortium, LLC www.Kansas.gov (Kansas) 1992 12/31/2021 (annual 1-year renewal options) |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Intangible Assets, Net | Intangible assets, net consisted of the following at December 31: December 31, 2015 December 31, 2014 Gross Carrying Value Accumulated Amortization Net Book Value Gross Carrying Value Accumulated Amortization Net Book Value Internal use capitalized $ 7,657,843 $ (5,391,168 ) $ 2,266,675 $ 6,666,300 $ (4,272,596 ) $ 2,393,704 |
Estimated Amortization Expense in Future Years | The total estimated intangible asset amortization expense in future years related to assets that have been placed in production is as follows: Fiscal Year 2016 $ 899,629 2017 468,474 2018 101,867 $ 1,469,970 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property and Equipment, Net | Property and equipment, net consisted of the following at December 31: 2015 2014 Equipment $ 29,573,499 $ 28,714,059 Purchased software 11,269,384 10,972,449 Furniture and fixtures 5,127,814 4,924,108 Leasehold improvements 1,956,822 1,402,487 47,927,519 46,013,103 Less accumulated depreciation (38,594,728 ) (33,765,863 ) Property and equipment, net $ 9,332,791 $ 12,247,240 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Future Minimum Lease Payments Under All Noncancellable Operating Leases | Future minimum lease payments under all noncancellable operating leases at December 31, 2015 are as follows: Fiscal Year 2016 $ 4,343,767 2017 3,775,439 2018 3,460,437 2019 1,723,802 2020 551,542 Thereafter 205,749 Total minimum lease payments $ 14,060,736 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Provision for Income Taxes | The provision for income taxes consists of the following: Year Ended December 31, 2015 2014 2013 Current income taxes: Federal $ 25,608,500 $ 23,161,061 $ 18,436,209 State 3,522,333 3,256,031 3,154,439 Total 29,130,833 26,417,092 21,590,648 Deferred income taxes: Federal (3,485,844 ) (2,295,450 ) (1,111,536 ) State (328,930 ) (165,790 ) 41,548 Total (3,814,774 ) (2,461,240 ) (1,069,988 ) Total income tax provision $ 25,316,059 $ 23,955,852 $ 20,520,660 |
Deferred Income Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities were as follows at December 31: 2015 2014 Deferred tax assets: Stock-based compensation $ 2,175,291 $ 1,836,673 Amortization of internal use software development costs 1,999,641 1,755,520 Federal benefit of state uncertain tax positions 1,110,917 767,867 Accrued vacation 894,591 854,463 State net operating loss carryforwards 457,485 341,794 Deferred rent 233,326 224,187 Allowance for doubtful accounts 178,015 184,675 Other 326,138 48,529 7,375,404 6,013,708 Less: Valuation allowance (412,821 ) (332,863 ) Total 6,962,583 5,680,845 Deferred tax liabilities: Depreciation & capitalized internal use software and development costs (4,421,900 ) (5,056,061 ) Nonrecurring gain on acquisition of business (1,119,230 ) (1,121,326 ) Total (5,541,130 ) (6,177,387 ) Net deferred tax asset (liability) $ 1,421,453 $ (496,542 ) |
Statutory Federal Income Tax Rate and Effective Income Tax Rate Reconciliation | The following table reconciles the statutory federal income tax rate and the effective income tax rate indicated by the consolidated statements of income: Year Ended December 31, 2015 2014 2013 Statutory federal income tax rate 35.0 % 35.0 % 35.0 % State income taxes 2.1 2.2 3.2 Nondeductible expenses 1.0 1.2 1.4 Uncertain tax positions 0.9 1.1 1.2 Federal and state tax credits (1.2 ) (1.2 ) (2.0 ) Other (0.2 ) (0.3 ) 0.2 Effective federal and state income tax rate 37.6 % 38.0 % 39.0 % |
Reconciliation of Unrecognized Income Tax Benefits | The following table provides a reconciliation of the beginning and ending amount of the consolidated liability for unrecognized income tax benefits (included in other long-term liabilities in the consolidated balance sheets) for the years ended December 31, 2015, 2014 and 2013: 2015 2014 2013 Balance at January 1 $ 2,797,671 $ 1,760,434 $ 688,575 Additions for tax positions of current years 1,093,963 1,072,333 632,309 Additions for tax positions of prior years 338,123 112,459 439,550 Expiration of the statute of limitations (365,762 ) (126,918 ) - Reductions for tax positions of prior years (142,973 ) (20,637 ) - Balance at December 31 $ 3,721,022 $ 2,797,671 $ 1,760,434 |
STOCK-BASED COMPENSATION AND 26
STOCK-BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Stock-based Compensation Expense | The following table presents stock-based compensation expense included in the Company’s consolidated statements of income: Year Ended December 31, 2015 2014 2013 Cost of portal revenues, exclusive of depreciation & amortization $ 1,404,093 $ 1,311,827 $ 1,100,396 Cost of software & services revenues, exclusive of depreciation & amortization 82,814 47,105 48,128 Selling & administrative 4,953,934 4,744,966 2,877,436 Stock-based compensation expense before income taxes 6,440,841 6,103,898 4,025,960 Income tax benefit (2,423,029 ) (2,320,499 ) (1,571,867 ) Net stock-based compensation expense $ 4,017,812 $ 3,783,399 $ 2,454,093 |
Restricted Stock Activity | A summary of restricted stock activity for the year ended December 31, 2015 is presented below: Restricted Shares Weighted Average Grant Date Fair Value Outstanding at January 1, 2015 993,453 $ 16.28 Granted 432,694 16.80 Vested (364,380 ) 15.02 Canceled (136,737 ) 15.27 Outstanding at December 31, 2015 925,030 17.17 |
Assumptions Used to Estimate Grant Date Fair Value Using Black-Scholes Model | The fair values of the offerings were estimated on the dates of grant using the Black-Scholes model using the assumptions in the following table. March 31, 2016 Offering March 31, 2015 Offering March 31, 2014 Offering Risk-free interest rate 0.27 % 0.13 % 0.14 % Expected dividend yield 3.07 % 3.08 % 3.73 % Expected life 1.0 year 1.0 year 1.0 year Expected stock price volatility 37.86 % 35.97 % 28.84 % Weighted average fair value of ESPP rights $ 4.88 $ 5.38 $ 4.59 |
REPORTABLE SEGMENTS AND RELAT27
REPORTABLE SEGMENTS AND RELATED INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Financial Information for Reportable Segments | The table below reflects summarized financial information for the Company’s reportable and operating segments for the years ended December 31: Outsourced Portals Other Software & Services Other Reconciling Items Consolidated Total 2015 Revenues $ 273,502,323 $ 18,873,973 $ - $ 292,376,296 Costs & expenses 168,166,011 5,431,967 43,098,323 216,696,301 Depreciation & amortization 4,648,870 47,015 3,689,528 8,385,413 Operating income (loss) before income taxes $ 100,687,442 $ 13,394,991 $ (46,787,851 ) $ 67,294,582 2014 Revenues $ 255,743,418 $ 16,353,153 $ - $ 272,096,571 Costs & expenses 156,185,335 4,783,606 38,936,541 199,905,482 Depreciation & amortization 5,305,302 36,999 3,834,717 9,177,018 Operating income (loss) before income taxes $ 94,252,781 $ 11,532,548 $ (42,771,258 ) $ 63,014,071 2013 Revenues $ 235,183,005 $ 14,095,660 $ - $ 249,278,665 Costs & expenses 147,007,246 4,498,233 36,881,346 188,386,825 Depreciation & amortization 4,962,692 53,475 3,316,922 8,333,089 Operating income (loss) before income taxes $ 83,213,067 $ 9,543,952 $ (40,198,268 ) $ 52,558,751 |
UNAUDITED QUARTERLY OPERATING28
UNAUDITED QUARTERLY OPERATING RESULTS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Operating Results | The unaudited quarterly information below is subject to seasonal fluctuations resulting in lower portal revenues in the fourth quarter of each calendar year (on an individual portal basis, and excluding revenues from new outsourced government portal contracts awarded or acquired during the year), due to the lower number of business days in the quarter and a lower volume of business-to-government and citizen-to-government transactions during the holiday periods. 2015 Three Months Ended Year Ended March 31, 2015 June 30, 2015 September 30, 2015 December 31, 2015 December 31, 2015 Revenues: Portal revenues $ 65,913,898 $ 71,030,846 $ 70,122,162 $ 66,435,417 $ 273,502,323 Software & services revenues 4,444,725 4,781,930 4,924,120 4,723,198 18,873,973 Total revenues 70,358,623 75,812,776 75,046,282 71,158,615 292,376,296 Operating expenses: Cost of portal revenues, exclusive of depreciation & amortization 41,494,301 42,815,102 41,057,942 42,798,666 168,166,011 Cost of software & services revenues, exclusive of depreciation & amortization 1,289,860 1,321,259 1,364,726 1,456,122 5,431,967 Selling & administrative 10,537,491 10,818,680 10,576,445 11,165,707 43,098,323 Depreciation & amortization 2,292,118 2,303,571 2,116,319 1,673,405 8,385,413 Total operating expenses 55,613,770 57,258,612 55,115,432 57,093,900 225,081,714 Operating income before income taxes 14,744,853 18,554,164 19,930,850 14,064,715 67,294,582 Income tax provision 5,803,949 7,250,724 7,180,660 5,080,726 25,316,059 Net income $ 8,940,904 $ 11,303,440 $ 12,750,190 $ 8,983,989 $ 41,978,523 Basic net income per share $ 0.14 $ 0.17 $ 0.19 $ 0.13 $ 0.63 Diluted net income per share $ 0.14 $ 0.17 $ 0.19 $ 0.13 $ 0.63 Weighted average shares outstanding: Basic 65,387,427 65,587,822 65,617,812 65,621,684 65,554,655 Diluted 65,387,427 65,587,822 65,636,436 65,715,951 65,639,682 2014 Three Months Ended Year Ended March 31, 2014 June 30, 2014 September 30, 2014 December 31, 2014 December 31, 2014 Revenues: Portal revenues $ 61,482,452 $ 66,807,907 $ 65,304,664 $ 62,148,395 $ 255,743,418 Software & services revenues 3,915,233 4,345,879 4,222,534 3,869,507 16,353,153 Total revenues 65,397,685 71,153,786 69,527,198 66,017,902 272,096,571 Operating expenses: Cost of portal revenues, exclusive of depreciation & amortization 37,559,503 39,550,094 39,090,865 39,984,873 156,185,335 Cost of software & services revenues, exclusive of depreciation & amortization 993,324 1,244,843 1,287,083 1,258,356 4,783,606 Selling & administrative 9,208,685 9,840,579 10,396,876 9,490,401 38,936,541 Depreciation & amortization 2,249,734 2,277,048 2,292,382 2,357,854 9,177,018 Total operating expenses 50,011,246 52,912,564 53,067,206 53,091,484 209,082,500 Operating income before income taxes 15,386,439 18,241,222 16,459,992 12,926,418 63,014,071 Income tax provision 6,010,054 7,213,057 6,098,567 4,634,174 23,955,852 Net income $ 9,376,385 $ 11,028,165 $ 10,361,425 $ 8,292,244 $ 39,058,219 Basic net income per share $ 0.14 $ 0.17 $ 0.16 $ 0.12 $ 0.59 Diluted net income per share $ 0.14 $ 0.17 $ 0.16 $ 0.12 $ 0.59 Weighted average shares outstanding: Basic 65,056,725 65,244,575 65,287,702 65,301,797 65,223,549 Diluted 65,056,725 65,244,575 65,287,702 65,363,104 65,277,758 |
The Company - Additional Inform
The Company - Additional Information (Detail) | Dec. 31, 2015Categories |
Nature Of Operations [Line Items] | |
Number of business channels | 2 |
Summary of Significant Accoun30
Summary of Significant Accounting Policies - Additional Information (Detail) $ / shares in Units, shares in Millions | Nov. 02, 2015USD ($)$ / shares | Oct. 27, 2014USD ($)$ / shares | Oct. 28, 2013USD ($)$ / shares | Dec. 31, 2015USD ($)Categories | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($)Categoriesshares | Dec. 31, 2014USD ($)shares | Dec. 31, 2013USD ($)$ / sharesshares |
Significant Accounting Policies [Line Items] | ||||||||||||||
Number of revenue and cost categories | Categories | 2 | 2 | ||||||||||||
Provision for losses on accounts receivable | $ 289,666 | $ 414,042 | $ 5,229,277 | |||||||||||
Non-cash charge per share after-tax | $ / shares | $ 0.05 | |||||||||||||
Selling & administrative | $ 11,165,707 | $ 10,576,445 | $ 10,818,680 | $ 10,537,491 | $ 9,490,401 | $ 10,396,876 | $ 9,840,579 | $ 9,208,685 | 43,098,323 | 38,936,541 | $ 36,881,346 | |||
Special cash dividend declared, date | Nov. 2, 2015 | Oct. 27, 2014 | Oct. 28, 2013 | |||||||||||
Special cash dividend declared per share | $ / shares | $ 0.55 | $ 0.50 | $ 0.35 | |||||||||||
Special cash dividend record, date | Nov. 13, 2015 | Nov. 7, 2014 | Nov. 8, 2013 | |||||||||||
Special cash dividend paid | $ 36,455,955 | $ 32,977,016 | $ 22,982,447 | 36,455,955 | 32,977,016 | $ 22,982,447 | ||||||||
Special cash dividend paid, date | Jan. 4, 2016 | Nov. 20, 2014 | Jan. 2, 2014 | |||||||||||
Allowance for doubtful accounts | 500,000 | 500,000 | $ 500,000 | 500,000 | ||||||||||
Depreciation method | Depreciation is computed using the straight-line method over estimated useful live | |||||||||||||
Unearned revenues | 900,000 | $ 1,300,000 | $ 900,000 | $ 1,300,000 | ||||||||||
Unvested service-based restricted stock awards included in the calculation of earnings per share | shares | 0.6 | 0.6 | 0.7 | |||||||||||
Decrease in current net deferred tax assets | $ 1,000,000 | |||||||||||||
Internal use capitalized software | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated economic useful life, in months | 36 months | 36 months | ||||||||||||
Legal Fees and Other Third Party Costs | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Selling & administrative | $ 4,000,000 | |||||||||||||
Deposits Assets | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Cash subject to FDIC insurance | 10,200,000 | $ 10,200,000 | ||||||||||||
Cash not subject to FDIC insurance | $ 88,200,000 | $ 88,200,000 | ||||||||||||
Furniture and Fixtures | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated useful lives | 8 years | 8 years | 8 years | |||||||||||
Equipment | Minimum | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated useful lives | 3 years | 3 years | 3 years | |||||||||||
Equipment | Maximum | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated useful lives | 10 years | 10 years | 10 years | |||||||||||
Purchased Software | Minimum | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated useful lives | 3 years | 3 years | 3 years | |||||||||||
Purchased Software | Maximum | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated useful lives | 5 years | 5 years | 5 years | |||||||||||
Leasehold Improvements | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated life | The lesser of the term of the lease or 5 years | |||||||||||||
Leasehold Improvements | Maximum | ||||||||||||||
Significant Accounting Policies [Line Items] | ||||||||||||||
Estimated useful lives | 5 years | 5 years | 5 years |
Computation of Basic and Dilute
Computation of Basic and Diluted Earnings per Share (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Numerator: | |||||||||||
Net income | $ 8,983,989 | $ 12,750,190 | $ 11,303,440 | $ 8,940,904 | $ 8,292,244 | $ 10,361,425 | $ 11,028,165 | $ 9,376,385 | $ 41,978,523 | $ 39,058,219 | $ 32,038,091 |
Less: Income allocated to participating securities | (384,246) | (368,668) | (325,182) | ||||||||
Net income available to common stockholders | $ 41,594,277 | $ 38,689,551 | $ 31,712,909 | ||||||||
Denominator: | |||||||||||
Weighted average shares - basic | 65,621,684 | 65,617,812 | 65,587,822 | 65,387,427 | 65,301,797 | 65,287,702 | 65,244,575 | 65,056,725 | 65,554,655 | 65,223,549 | 64,888,978 |
Performance-based restricted stock awards | 85,027 | 54,209 | 65,388 | ||||||||
Weighted average shares - diluted | 65,715,951 | 65,636,436 | 65,587,822 | 65,387,427 | 65,363,104 | 65,287,702 | 65,244,575 | 65,056,725 | 65,639,682 | 65,277,758 | 64,954,366 |
Basic net income per share: | |||||||||||
Net income | $ 0.13 | $ 0.19 | $ 0.17 | $ 0.14 | $ 0.12 | $ 0.16 | $ 0.17 | $ 0.14 | $ 0.63 | $ 0.59 | $ 0.49 |
Diluted net income per share: | |||||||||||
Net income | $ 0.13 | $ 0.19 | $ 0.17 | $ 0.14 | $ 0.12 | $ 0.16 | $ 0.17 | $ 0.14 | $ 0.63 | $ 0.59 | $ 0.49 |
Outsourced Government Contrac32
Outsourced Government Contracts - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015USD ($)ContractRenewalOptions | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($)RenewalOptions | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Sep. 30, 2015 | Dec. 31, 2015USD ($)ContractRenewalOptions | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Contracts [Line Items] | ||||||||||||
Number of portal outsourcing contracts that can be terminated by the other party without cause on period of notice | Contract | 18 | 18 | ||||||||||
Performance bond commitments | $ 6,100,000 | $ 6,100,000 | ||||||||||
Number of outsourced portal services or software development and services contracts with expiration date within a 12-month period | Contract | 10 | 10 | ||||||||||
Revenues | $ 71,158,615 | $ 75,046,282 | $ 75,812,776 | $ 70,358,623 | $ 66,017,902 | $ 69,527,198 | $ 71,153,786 | $ 65,397,685 | $ 292,376,296 | $ 272,096,571 | $ 249,278,665 | |
Portal revenues | $ 66,435,417 | $ 70,122,162 | $ 71,030,846 | $ 65,913,898 | $ 62,148,395 | $ 65,304,664 | $ 66,807,907 | $ 61,482,452 | $ 273,502,323 | 255,743,418 | 235,183,005 | |
New Mexico Interactive, LLC | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
Contract renewal option | RenewalOptions | 2 | |||||||||||
NICUSA, AZ Division | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract Expiration Date | Mar. 26, 2014 | |||||||||||
NICUSA, AZ Division | Consolidated Revenues | ||||||||||||
Contracts [Line Items] | ||||||||||||
Revenues | 800,000 | 3,700,000 | ||||||||||
Delaware Interactive, LLC | ||||||||||||
Contracts [Line Items] | ||||||||||||
Portal revenues | $ 600,000 | $ 2,400,000 | $ 2,200,000 | |||||||||
Customer Concentration Risk | Consolidated Revenues | ||||||||||||
Contracts [Line Items] | ||||||||||||
Concentration risk percentage | 64.00% | |||||||||||
Government Contracts Concentration Risk | Consolidated Revenues | ||||||||||||
Contracts [Line Items] | ||||||||||||
Concentration risk percentage | 22.00% | |||||||||||
Montana | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 2 years | |||||||||||
IDAHO | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 2 years | |||||||||||
State of Alabama | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
TENNESSEE | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
State of Oklahoma | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
Contract renewal option | RenewalOptions | 4 | |||||||||||
State of Oklahoma | Renewal Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
State of New Jersey | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 5 years | |||||||||||
Contract renewal option | RenewalOptions | 2 | |||||||||||
State of New Jersey | Renewal Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
State of Utah | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 3 years | |||||||||||
KENTUCKY | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
State of Maryland | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
US Department of Transportation, Federal Motor Carrier Safety Administration | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract Expiration Date | Aug. 31, 2016 | |||||||||||
State of Maine | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 2 years | |||||||||||
State of Texas | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
State of Nebraska | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 3 years | |||||||||||
Contract renewal option | RenewalOptions | 2 | |||||||||||
State of Nebraska | Renewal Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 1 year | |||||||||||
State of Hawaii | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 3 years | |||||||||||
State of Mississippi | Extended Term | ||||||||||||
Contracts [Line Items] | ||||||||||||
Contract period | 2 years |
Summary of Enterprise-Wide Port
Summary of Enterprise-Wide Portal Outsourcing Services to Multiple Governments Agencies (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Connecticut Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.ct.gov (Connecticut) |
Year Service Commenced | 2,014 |
Contract Expiration Date | Jan. 9, 2017 |
Connecticut Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Jan. 9, 2020 |
Wisconsin Interactive Network, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.wisconsin.gov (Wisconsin) |
Year Service Commenced | 2,013 |
Contract Expiration Date | May 13, 2018 |
Wisconsin Interactive Network, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | May 13, 2023 |
Pennsylvania Interactive LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.pa.gov (Pennsylvania) |
Year Service Commenced | 2,012 |
Contract Expiration Date | Nov. 30, 2017 |
Pennsylvania Interactive LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Nov. 30, 2022 |
NICUSA, OR Division | |
Contracts [Line Items] | |
Portal Website (State) | www.oregon.gov (Oregon) |
Year Service Commenced | 2,011 |
Contract Expiration Date | Nov. 22, 2021 |
NICUSA, MD Division | |
Contracts [Line Items] | |
Portal Website (State) | www.maryland.gov (Maryland) |
Year Service Commenced | 2,011 |
Contract Expiration Date | Aug. 10, 2017 |
NICUSA, MD Division | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Aug. 10, 2019 |
Mississippi Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.ms.gov (Mississippi) |
Year Service Commenced | 2,011 |
Contract Expiration Date | Dec. 31, 2017 |
Mississippi Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Dec. 31, 2021 |
New Jersey Interactive LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.nj.gov (New Jersey) |
Year Service Commenced | 2,009 |
Contract Expiration Date | May 1, 2020 |
New Jersey Interactive LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | May 1, 2022 |
Texas NICUSA, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Texas.gov (Texas) |
Year Service Commenced | 2,009 |
Contract Expiration Date | Aug. 31, 2018 |
West Virginia Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.WV.gov (West Virginia) |
Year Service Commenced | 2,007 |
Contract Expiration Date | Mar. 31, 2016 |
Vermont Information Consortium, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Vermont.gov (Vermont) |
Year Service Commenced | 2,006 |
Contract Expiration Date | Jun. 8, 2016 |
Vermont Information Consortium, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Jun. 8, 2019 |
Colorado Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Colorado.gov (Colorado) |
Year Service Commenced | 2,005 |
Contract Expiration Date | Apr. 30, 2019 |
Colorado Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Apr. 30, 2023 |
South Carolina Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.SC.gov (South Carolina) |
Year Service Commenced | 2,005 |
Contract Expiration Date | Jul. 15, 2019 |
South Carolina Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Jul. 15, 2021 |
Kentucky Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Kentucky.gov (Kentucky) |
Year Service Commenced | 2,003 |
Contract Expiration Date | Aug. 31, 2016 |
Alabama Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Alabama.gov (Alabama) |
Year Service Commenced | 2,002 |
Contract Expiration Date | Mar. 1, 2016 |
Alabama Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Mar. 1, 2017 |
Rhode Island Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.RI.gov (Rhode Island) |
Year Service Commenced | 2,001 |
Contract Expiration Date | Jul. 1, 2017 |
Rhode Island Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Jul. 1, 2019 |
Oklahoma Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.OK.gov (Oklahoma) |
Year Service Commenced | 2,001 |
Contract Expiration Date | Mar. 31, 2016 |
Oklahoma Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Mar. 31, 2020 |
Montana Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.MT.gov (Montana) |
Year Service Commenced | 2,001 |
Contract Expiration Date | Dec. 31, 2017 |
Montana Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Dec. 31, 2020 |
NICUSA, TN Division | |
Contracts [Line Items] | |
Portal Website (State) | www.TN.gov (Tennessee) |
Year Service Commenced | 2,000 |
Contract Expiration Date | Mar. 31, 2017 |
Hawaii Information Consortium, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.eHawaii.gov (Hawaii) |
Year Service Commenced | 2,000 |
Contract Expiration Date | Jan. 3, 2019 |
Hawaii Information Consortium, LLC | Renewal Term | |
Contracts [Line Items] | |
Term of contract | 3-year renewal options |
Idaho Information Consortium, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Idaho.gov (Idaho) |
Year Service Commenced | 2,000 |
Contract Expiration Date | Jun. 30, 2017 |
Utah Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Utah.gov (Utah) |
Year Service Commenced | 1,999 |
Contract Expiration Date | Jun. 5, 2019 |
Maine Information Network, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Maine.gov (Maine) |
Year Service Commenced | 1,999 |
Contract Expiration Date | Jul. 1, 2018 |
Arkansas Information Consortium, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Arkansas.gov (Arkansas) |
Year Service Commenced | 1,997 |
Contract Expiration Date | Jun. 30, 2018 |
Iowa Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Iowa.gov (Iowa) |
Year Service Commenced | 1,997 |
Contract Expiration Date | Jun. 30, 2016 |
Iowa Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Jun. 30, 2020 |
Indiana Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.IN.gov (Indiana) |
Year Service Commenced | 1,995 |
Contract Expiration Date | Jul. 31, 2016 |
Nebraska Interactive, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Nebraska.gov (Nebraska) |
Year Service Commenced | 1,995 |
Contract Expiration Date | Apr. 1, 2019 |
Nebraska Interactive, LLC | Renewal Term | |
Contracts [Line Items] | |
Contract Expiration Date | Apr. 1, 2021 |
Kansas Information Consortium, LLC | |
Contracts [Line Items] | |
Portal Website (State) | www.Kansas.gov (Kansas) |
Year Service Commenced | 1,992 |
Contract Expiration Date | Dec. 31, 2021 |
Kansas Information Consortium, LLC | Renewal Term | |
Contracts [Line Items] | |
Term of contract | annual 1-year renewal options |
Intangible Assets, Net (Detail)
Intangible Assets, Net (Detail) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Finite Lived Intangible Assets Future Amortization Expense Total | $ 1,469,970 | |
Internal use capitalized software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 7,657,843 | $ 6,666,300 |
Accumulated Amortization | (5,391,168) | (4,272,596) |
Finite Lived Intangible Assets Future Amortization Expense Total | $ 2,266,675 | $ 2,393,704 |
Intangible Assets, Net - Additi
Intangible Assets, Net - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Internal use capitalized software | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of internal use capitalized software | $ 1.1 | $ 1 | $ 0.6 |
Estimated Amortization Expense
Estimated Amortization Expense in Future Years (Detail) | Dec. 31, 2015USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
2,016 | $ 899,629 |
2,017 | 468,474 |
2,018 | 101,867 |
Finite Lived Intangible Assets Future Amortization Expense Total | $ 1,469,970 |
Property and Equipment, Net (De
Property and Equipment, Net (Detail) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment [Line Items] | ||
Equipment | $ 29,573,499 | $ 28,714,059 |
Purchased software | 11,269,384 | 10,972,449 |
Furniture and fixtures | 5,127,814 | 4,924,108 |
Leasehold improvements | 1,956,822 | 1,402,487 |
Property and equipment, Gross | 47,927,519 | 46,013,103 |
Less accumulated depreciation | (38,594,728) | (33,765,863) |
Property and equipment, net | $ 9,332,791 | $ 12,247,240 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 7.3 | $ 8.2 | $ 7.7 |
Debt Obligations and Collater39
Debt Obligations and Collateral Requirements - Additional Information (Detail) - USD ($) $ in Millions | Dec. 14, 2015 | Jul. 09, 2015 | Dec. 31, 2015 |
Debt Instrument [Line Items] | |||
Debt instrument, covenant compliance | The Company was in compliance with each of these covenants at December 31, 2015. | ||
Letters of credit, maximum effective in force period | 1 year | ||
Performance bond commitments | $ 6.1 | ||
Amount that unrestricted cash would have decreased had the Company been required to post 100% cash collateral for the face value of all performance bonds, letters of credit and its line of credit in conjunction with a corporate credit card agreement | 8.3 | ||
First Amendment | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Credit facility, amended expiration date | May 1, 2017 | ||
First Amendment | Revolving Credit Facility | Letter of Credit | If the Company's consolidated leverage ratio is less than or equal to 1.25:1 | |||
Debt Instrument [Line Items] | |||
Fees on outstanding letters of credit | 1.15% | ||
Consolidated leverage ratio | 150.00% | ||
First Amendment | Revolving Credit Facility | Letter of Credit | If the Company's consolidated leverage ratio is greater than 1.25:1 | |||
Debt Instrument [Line Items] | |||
Fees on outstanding letters of credit | 1.25% | ||
Consolidated leverage ratio | 150.00% | ||
Unsecured Credit Agreement | Letter of Credit | |||
Debt Instrument [Line Items] | |||
Credit facility, available borrowing capacity | 3.8 | ||
Unsecured Credit Agreement | Covenant Requirement | |||
Debt Instrument [Line Items] | |||
Consolidated leverage ratio | 150.00% | ||
Consolidated tangible net worth required | $ 36 | ||
Unsecured Credit Agreement | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Credit facility, outstanding letters of credit | 1.2 | ||
Credit facility, available borrowing capacity | 8.8 | ||
Credit facility, increase available capacity under the credit agreement | 50 | ||
Credit card | |||
Debt Instrument [Line Items] | |||
Credit facility, maximum borrowing capacity | $ 1 | ||
Second Amendment | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Fees payable on outstanding letters of credit to daily amount available to be drawn under any letter of credit | 1.00% | ||
Second Amendment | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | |||
Debt Instrument [Line Items] | |||
Debt instrument, term | One-month term | ||
Second Amendment | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Minimum | |||
Debt Instrument [Line Items] | |||
Debt instrument, variable rate | 1.15% | ||
Second Amendment | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Maximum | |||
Debt Instrument [Line Items] | |||
Debt instrument, variable rate | 1.25% |
Future Minimum Lease Payments U
Future Minimum Lease Payments Under All Noncancellable Operating Leases (Detail) | Dec. 31, 2015USD ($) |
Operating Leased Assets [Line Items] | |
2,016 | $ 4,343,767 |
2,017 | 3,775,439 |
2,018 | 3,460,437 |
2,019 | 1,723,802 |
2,020 | 551,542 |
Thereafter | 205,749 |
Total minimum lease payments | $ 14,060,736 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Commitments and Contingencies Disclosure [Line Items] | |||
Rent expense for operating leases | $ 4.5 | $ 4.3 | $ 4.2 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) | Nov. 02, 2015 | Oct. 27, 2014 | Oct. 28, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Stockholders Equity Note [Line Items] | ||||||
Special cash dividend declared, date | Nov. 2, 2015 | Oct. 27, 2014 | Oct. 28, 2013 | |||
Special cash dividend record, date | Nov. 13, 2015 | Nov. 7, 2014 | Nov. 8, 2013 | |||
Special cash dividend declared per share | $ 0.55 | $ 0.50 | $ 0.35 | |||
Special cash dividend paid | $ 36,455,955 | $ 32,977,016 | $ 22,982,447 | $ 36,455,955 | $ 32,977,016 | $ 22,982,447 |
Special cash dividend paid, date | Jan. 4, 2016 | Nov. 20, 2014 | Jan. 2, 2014 | |||
Common stock, shares outstanding | 65,618,141 | 65,298,472 | 64,987,854 | 65,636,707 | 65,303,205 | |
Dividend equivalent paid per share on unvested shares of restricted stock outstanding on the dividend record date granted under the Company's 2006 Stock Option and Incentive Plan | $ 0.55 | $ 0.50 | $ 0.35 | |||
Unvested shares of restricted stock on the dividend record date | 665,414 | 655,499 | 676,281 |
Provision for Income Taxes (Det
Provision for Income Taxes (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current income taxes: | |||||||||||
Federal | $ 25,608,500 | $ 23,161,061 | $ 18,436,209 | ||||||||
State | 3,522,333 | 3,256,031 | 3,154,439 | ||||||||
Total | 29,130,833 | 26,417,092 | 21,590,648 | ||||||||
Deferred income taxes: | |||||||||||
Federal | (3,485,844) | (2,295,450) | (1,111,536) | ||||||||
State | (328,930) | (165,790) | 41,548 | ||||||||
Total | (3,814,774) | (2,461,240) | (1,069,988) | ||||||||
Total income tax provision | $ 5,080,726 | $ 7,180,660 | $ 7,250,724 | $ 5,803,949 | $ 4,634,174 | $ 6,098,567 | $ 7,213,057 | $ 6,010,054 | $ 25,316,059 | $ 23,955,852 | $ 20,520,660 |
Deferred Income Tax Assets and
Deferred Income Tax Assets and Liabilities (Detail) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Stock-based compensation | $ 2,175,291 | $ 1,836,673 |
Amortization of internal use software development costs | 1,999,641 | 1,755,520 |
Federal benefit of state uncertain tax positions | 1,110,917 | 767,867 |
Accrued vacation | 894,591 | 854,463 |
State net operating loss carryforwards | 457,485 | 341,794 |
Deferred rent | 233,326 | 224,187 |
Allowance for doubtful accounts | 178,015 | 184,675 |
Other | 326,138 | 48,529 |
Deferred Tax Assets, Gross, Total | 7,375,404 | 6,013,708 |
Less: Valuation allowance | (412,821) | (332,863) |
Total | 6,962,583 | 5,680,845 |
Total | 6,962,583 | 5,680,845 |
Deferred tax liabilities: | ||
Depreciation & capitalized internal use software and development costs | (4,421,900) | (5,056,061) |
Nonrecurring gain on acquisition of business | (1,119,230) | (1,121,326) |
Total | (5,541,130) | (6,177,387) |
Total | (5,541,130) | (6,177,387) |
Net deferred tax liability | $ (496,542) | |
Net Deferred tax asset | $ 1,421,453 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes [Line Items] | |||
Deferred tax asset valuation allowance | $ 412,821 | $ 332,863 | |
Federal research and development tax credit | 400,000 | 400,000 | $ 800,000 |
Unrecognized tax benefits that if recognized would affect the annual effective tax rate | $ 2,600,000 | $ 2,000,000 | $ 1,300,000 |
Internal Revenue Service (IRS) | |||
Income Taxes [Line Items] | |||
Tax examinations | 2,013 | ||
Remaining years subject to tax examination | The Company remains subject to U.S. federal examination for the tax years ended on or after December 31, 2013. | ||
State income tax returns | Minimum | |||
Income Taxes [Line Items] | |||
Tax examination period | 3 years | ||
State income tax returns | Maximum | |||
Income Taxes [Line Items] | |||
Tax examination period | 5 years |
Statutory Federal Income Tax Ra
Statutory Federal Income Tax Rate and the Effective Income Tax Rate Reconciliation (Detail) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of Statutory Federal Tax Rate [Line Items] | |||
Statutory federal income tax rate | 35.00% | 35.00% | 35.00% |
State income taxes | 2.10% | 2.20% | 3.20% |
Nondeductible expenses | 1.00% | 1.20% | 1.40% |
Uncertain tax positions | 0.90% | 1.10% | 1.20% |
Federal and state tax credits | (1.20%) | (1.20%) | (2.00%) |
Other | (0.20%) | (0.30%) | 0.20% |
Effective federal and state income tax rate | 37.60% | 38.00% | 39.00% |
Reconciliation of Unrecognized
Reconciliation of Unrecognized Income Tax Benefits (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of Unrecognized Tax Benefits [Line Items] | |||
Beginning balance | $ 2,797,671 | $ 1,760,434 | $ 688,575 |
Additions for tax positions of current years | 1,093,963 | 1,072,333 | 632,309 |
Additions for tax positions of prior years | 338,123 | 112,459 | 439,550 |
Expiration of the statute of limitations | (365,762) | (126,918) | |
Reductions for tax positions of prior years | (142,973) | (20,637) | |
Ending balance | $ 3,721,022 | $ 2,797,671 | $ 1,760,434 |
Stock Based Compensation Expens
Stock Based Compensation Expenses (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense before income taxes | $ 6,440,841 | $ 6,103,898 | $ 4,025,960 |
Income tax benefit | (2,423,029) | (2,320,499) | (1,571,867) |
Net stock-based compensation expense | 4,017,812 | 3,783,399 | 2,454,093 |
Cost of portal revenues, exclusive of depreciation & amortization | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense before income taxes | 1,404,093 | 1,311,827 | 1,100,396 |
Cost of software & services revenues, exclusive of depreciation & amortization | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense before income taxes | 82,814 | 47,105 | 48,128 |
Selling & administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense before income taxes | $ 4,953,934 | $ 4,744,966 | $ 2,877,436 |
Stock-Based Compensation and 49
Stock-Based Compensation and Employee Benefit Plans - Additional Information (Detail) - USD ($) | 12 Months Ended | |||||||
Dec. 31, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | May. 31, 2014 | May. 30, 2014 | |
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation shares authorized for future grant | 4,681,841 | |||||||
Share based compensation shares authorized | 15,825,223 | 14,286,754 | ||||||
Effective date of retirement | Dec. 31, 2015 | |||||||
Tax deductions relating to stock-based compensation | $ 412,617 | $ 1,184,860 | $ 1,302,005 | |||||
Percentage of compensation that eligible employees can use to purchase common stock, maximum | 15.00% | 15.00% | 15.00% | |||||
Compensation Amount that eligible employees can use to purchase common stock | $ 25,000 | $ 25,000 | $ 25,000 | |||||
Percentage of fair market value eligible employees can purchase common stock as defined, minimum | 85.00% | 85.00% | 85.00% | |||||
Proceeds from employee common stock purchases | $ 1,131,389 | $ 1,106,777 | $ 904,471 | |||||
Employee Stock Purchase Plan | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation shares authorized | 2,321,688 | |||||||
Employee stock purchase plan, shares purchased | 75,328 | 68,101 | 87,578 | |||||
Employee stock purchase plan, per share price | $ 15.02 | $ 16.25 | $ 10.33 | |||||
Proceeds from employee common stock purchases | $ 1,100,000 | $ 1,100,000 | $ 900,000 | |||||
Closing fair market value of common stock on first day of current offering period | $ 17.48 | |||||||
Defined Contribution 401(k) Profit Sharing Plan | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Matching contribution to 401k, maximum | 5.00% | |||||||
Company matching contribution expense | $ 2,200,000 | $ 2,100,000 | $ 1,800,000 | |||||
Performance Shares | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award shares granted in period | 109,705 | |||||||
Share based compensation award granted in period grant-date fair value | $ 1,900,000 | |||||||
Share based compensation award vesting period from date of grant | 3 years | |||||||
Share based compensation award end date of the a three-year performance period | Dec. 31, 2017 | |||||||
Performance criteria over the performance period | The actual number of shares earned will be based on the Company's performance related to the following performance criteria over the performance period Operating income growth (three-year compound annual growth rate); Total consolidated revenue growth (three-year compound annual growth rate); and Cash flow return on invested capital, excluding income taxes paid (three-year average). | |||||||
Performance Shares | Performance Period 2012 to 2014 | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award shares earned in period | 67,239 | |||||||
Share based compensation dividend earned on shares subject to the awards, shares | 4,043 | |||||||
Share based compensation performance-based restricted stock awards, vesting date | Jan. 30, 2015 | |||||||
Share based compensation performance-based restricted stock awards, grant date | Jan. 30, 2012 | |||||||
Performance Shares | Performance Period 2013 to 2015 | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award shares earned in period | 96,732 | |||||||
Share based compensation dividend earned on shares subject to the awards, shares | 6,990 | |||||||
Share based compensation performance-based restricted stock awards, vesting date | Feb. 5, 2016 | |||||||
Share based compensation performance-based restricted stock awards, grant date | Feb. 5, 2013 | |||||||
Performance Shares | Performance Period 2011 to 2013 | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award shares earned in period | 85,365 | |||||||
Share based compensation dividend earned on shares subject to the awards, shares | 4,350 | |||||||
Share based compensation performance-based restricted stock awards, vesting date | Mar. 7, 2014 | |||||||
Share based compensation performance-based restricted stock awards, grant date | Mar. 7, 2011 | |||||||
Restricted Stock | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award shares granted in period | 432,694 | |||||||
Share based compensation fair value of restricted stock vested | $ 5,500,000 | $ 4,100,000 | $ 3,500,000 | |||||
Share based compensation award granted in period weighted average fair value at grant date, per share | $ 16.80 | $ 19.05 | $ 16.54 | |||||
Unrecognized compensation related to equity-based awards that have yet to vest | $ 6,900,000 | |||||||
Unrecognized compensation costs are expected to be recognized over a weighted average period (years) | 2 years 4 months 24 days | |||||||
Number of forfeited shares | 136,737 | |||||||
Restricted Stock | Service Based Awards | Employees And Executives | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award shares granted in period | 273,327 | |||||||
Share based compensation award granted in period grant-date fair value | $ 4,600,000 | |||||||
Share based compensation award vesting period from date of grant | 1 year | |||||||
Restricted Stock | Service Based Awards | Employees And Executives | Annual installment | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award annual installment vesting rate | 25.00% | |||||||
Restricted Stock | Service Based Awards | Non Employee Directors | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Share based compensation award shares granted in period | 45,619 | |||||||
Share based compensation award granted in period grant-date fair value | $ 800,000 | |||||||
Share based compensation award vesting period from date of grant | 1 year | |||||||
Service Based Restricted Stock | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Accelerated vesting of unvested service-based restricted stock | 21,813 | |||||||
Number of forfeited shares | 5,269 | |||||||
Performance Based Restricted Stock | ||||||||
Stock Based Compensation And Employee Benefit Plans [Line Items] | ||||||||
Number of forfeited shares | 33,651 |
Restricted Stock Activity (Deta
Restricted Stock Activity (Detail) - Restricted Stock - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Number of Shares | |||
Outstanding beginning of period | 993,453 | ||
Granted | 432,694 | ||
Vested | (364,380) | ||
Canceled | (136,737) | ||
Outstanding at end of period | 925,030 | 993,453 | |
Weighted-Average Grant Date Fair Value | |||
Outstanding beginning of period | $ 16.28 | ||
Granted | 16.80 | $ 19.05 | $ 16.54 |
Vested | 15.02 | ||
Canceled | 15.27 | ||
Outstanding at end of period | $ 17.17 | $ 16.28 |
Assumptions Used to Estimate Gr
Assumptions Used to Estimate Grant Date Fair Value Using the Black-Scholes Model (Detail) - $ / shares | 12 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2014 | |
Employee Stock Purchase Plan, Fair Value Assumptions, Method Used [Line Items] | |||
Risk-free interest rate | 0.13% | 0.14% | |
Expected dividend yield | 3.08% | 3.73% | |
Expected life | 1 year | 1 year | |
Expected stock price volatility | 35.97% | 28.84% | |
Weighted average fair value of ESPP rights | $ 5.38 | $ 4.59 | |
Scenario, Forecast | |||
Employee Stock Purchase Plan, Fair Value Assumptions, Method Used [Line Items] | |||
Risk-free interest rate | 0.27% | ||
Expected dividend yield | 3.07% | ||
Expected life | 1 year | ||
Expected stock price volatility | 37.86% | ||
Weighted average fair value of ESPP rights | $ 4.88 |
Reportable Segments and Relat52
Reportable Segments and Related Information - Additional Information (Detail) - Segment | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | 1 | ||
Customer Concentration Risk | Consolidated Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk percentage | 64.00% | ||
Customer Concentration Risk | Consolidated Revenues | Data Resellers | |||
Segment Reporting Information [Line Items] | |||
Concentration risk percentage | 23.00% | 24.00% | 22.00% |
Customer Concentration Risk | Accounts Receivable | Data Resellers | |||
Segment Reporting Information [Line Items] | |||
Concentration risk percentage | 17.00% | 24.00% | |
Product Concentration Risk | Consolidated Revenues | Outsourced Portals - DMV Transaction - Based | |||
Segment Reporting Information [Line Items] | |||
Concentration risk percentage | 35.00% | 35.00% | 34.00% |
Product Concentration Risk | Consolidated Revenues | Motor Vehicle Registration And Licensing | |||
Segment Reporting Information [Line Items] | |||
Concentration risk percentage | 13.00% | 12.00% | 13.00% |
Texas NICUSA, LLC | Customer Concentration Risk | Consolidated Revenues | |||
Segment Reporting Information [Line Items] | |||
Concentration risk percentage | 21.00% | 22.00% | 23.00% |
Summary of Financial Informatio
Summary of Financial Information for Reportable Segments (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 71,158,615 | $ 75,046,282 | $ 75,812,776 | $ 70,358,623 | $ 66,017,902 | $ 69,527,198 | $ 71,153,786 | $ 65,397,685 | $ 292,376,296 | $ 272,096,571 | $ 249,278,665 |
Costs & expenses | 216,696,301 | 199,905,482 | 188,386,825 | ||||||||
Depreciation & amortization | $ 1,673,405 | $ 2,116,319 | $ 2,303,571 | $ 2,292,118 | $ 2,357,854 | $ 2,292,382 | $ 2,277,048 | $ 2,249,734 | 8,385,413 | 9,177,018 | 8,333,089 |
Operating income (loss) before income taxes | 67,294,582 | 63,014,071 | 52,558,751 | ||||||||
Total segment operating income | Outsourced Portals | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 273,502,323 | 255,743,418 | 235,183,005 | ||||||||
Costs & expenses | 168,166,011 | 156,185,335 | 147,007,246 | ||||||||
Depreciation & amortization | 4,648,870 | 5,305,302 | 4,962,692 | ||||||||
Operating income (loss) before income taxes | 100,687,442 | 94,252,781 | 83,213,067 | ||||||||
Total segment operating income | Other Software & Services | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 18,873,973 | 16,353,153 | 14,095,660 | ||||||||
Costs & expenses | 5,431,967 | 4,783,606 | 4,498,233 | ||||||||
Depreciation & amortization | 47,015 | 36,999 | 53,475 | ||||||||
Operating income (loss) before income taxes | 13,394,991 | 11,532,548 | 9,543,952 | ||||||||
Other Reconciling Items | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Costs & expenses | 43,098,323 | 38,936,541 | 36,881,346 | ||||||||
Depreciation & amortization | 3,689,528 | 3,834,717 | 3,316,922 | ||||||||
Operating income (loss) before income taxes | $ (46,787,851) | $ (42,771,258) | $ (40,198,268) |
Quarterly Operating Results (De
Quarterly Operating Results (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | |||||||||||
Portal revenues | $ 66,435,417 | $ 70,122,162 | $ 71,030,846 | $ 65,913,898 | $ 62,148,395 | $ 65,304,664 | $ 66,807,907 | $ 61,482,452 | $ 273,502,323 | $ 255,743,418 | $ 235,183,005 |
Software & services revenues | 4,723,198 | 4,924,120 | 4,781,930 | 4,444,725 | 3,869,507 | 4,222,534 | 4,345,879 | 3,915,233 | 18,873,973 | 16,353,153 | 14,095,660 |
Total revenues | 71,158,615 | 75,046,282 | 75,812,776 | 70,358,623 | 66,017,902 | 69,527,198 | 71,153,786 | 65,397,685 | 292,376,296 | 272,096,571 | 249,278,665 |
Operating expenses: | |||||||||||
Cost of portal revenues, exclusive of depreciation & amortization | 42,798,666 | 41,057,942 | 42,815,102 | 41,494,301 | 39,984,873 | 39,090,865 | 39,550,094 | 37,559,503 | 168,166,011 | 156,185,335 | 147,007,246 |
Cost of software & services revenues, exclusive of depreciation & amortization | 1,456,122 | 1,364,726 | 1,321,259 | 1,289,860 | 1,258,356 | 1,287,083 | 1,244,843 | 993,324 | 5,431,967 | 4,783,606 | 4,498,233 |
Selling & administrative | 11,165,707 | 10,576,445 | 10,818,680 | 10,537,491 | 9,490,401 | 10,396,876 | 9,840,579 | 9,208,685 | 43,098,323 | 38,936,541 | 36,881,346 |
Depreciation & amortization | 1,673,405 | 2,116,319 | 2,303,571 | 2,292,118 | 2,357,854 | 2,292,382 | 2,277,048 | 2,249,734 | 8,385,413 | 9,177,018 | 8,333,089 |
Total operating expenses | 57,093,900 | 55,115,432 | 57,258,612 | 55,613,770 | 53,091,484 | 53,067,206 | 52,912,564 | 50,011,246 | 225,081,714 | 209,082,500 | 196,719,914 |
Operating income before income taxes | 14,064,715 | 19,930,850 | 18,554,164 | 14,744,853 | 12,926,418 | 16,459,992 | 18,241,222 | 15,386,439 | 67,294,582 | 63,014,071 | |
Income tax provision | 5,080,726 | 7,180,660 | 7,250,724 | 5,803,949 | 4,634,174 | 6,098,567 | 7,213,057 | 6,010,054 | 25,316,059 | 23,955,852 | 20,520,660 |
Net income | $ 8,983,989 | $ 12,750,190 | $ 11,303,440 | $ 8,940,904 | $ 8,292,244 | $ 10,361,425 | $ 11,028,165 | $ 9,376,385 | $ 41,978,523 | $ 39,058,219 | $ 32,038,091 |
Basic net income per share | $ 0.13 | $ 0.19 | $ 0.17 | $ 0.14 | $ 0.12 | $ 0.16 | $ 0.17 | $ 0.14 | $ 0.63 | $ 0.59 | $ 0.49 |
Diluted net income per share | $ 0.13 | $ 0.19 | $ 0.17 | $ 0.14 | $ 0.12 | $ 0.16 | $ 0.17 | $ 0.14 | $ 0.63 | $ 0.59 | $ 0.49 |
Weighted average shares outstanding: | |||||||||||
Basic | 65,621,684 | 65,617,812 | 65,587,822 | 65,387,427 | 65,301,797 | 65,287,702 | 65,244,575 | 65,056,725 | 65,554,655 | 65,223,549 | 64,888,978 |
Diluted | 65,715,951 | 65,636,436 | 65,587,822 | 65,387,427 | 65,363,104 | 65,287,702 | 65,244,575 | 65,056,725 | 65,639,682 | 65,277,758 | 64,954,366 |