Cogent Communications (CCOI) 10-Q 3 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 31, 2016
Document and Entity Information
Entity Registrant Name	COGENT COMMUNICATIONS HOLDINGS, INC.
Entity Central Index Key	1,158,324
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		45,486,222
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 148,151	$ 203,591
Accounts receivable, net of allowance for doubtful accounts of $1,804 and $1,757, respectively	33,487	30,718
Prepaid expenses and other current assets	20,642	17,030
Total current assets	202,280	251,339
Property and equipment, net	370,749	360,136
Deferred tax assets - noncurrent	36,716	45,142
Deposits and other assets - $132 and $355 restricted, respectively	7,877	6,199
Total assets	617,622	662,816
Current liabilities:
Accounts payable	13,019	12,401
Accrued and other current liabilities	41,790	38,355
Installment payment agreement, current portion, net of discount of $106 and $678	1,028	11,901
Current maturities, capital lease obligations	6,122	6,247
Total current liabilities	61,959	68,904
Senior secured 2022 notes, net of unamortized debt costs of $1,121 and $1,252, respectively	248,879	248,748
Senior unsecured 2021 notes, net of unamortized debt costs of $2,703 and $3,305, respectively	186,522	196,695
Capital lease obligations, net of current maturities	134,229	129,763
Other long term liabilities	26,519	30,977
Total liabilities	658,108	675,087
Commitments and contingencies:
Stockholders' equity:
Common stock, $0.001 par value; 75,000,000 shares authorized; 45,537,353 and 45,198,718 shares issued and outstanding, respectively	45	45
Additional paid-in capital	442,125	434,161
Accumulated other comprehensive income-foreign currency translation	(11,898)	(14,693)
Accumulated deficit	(470,758)	(431,784)
Total stockholders' (deficit) equity	(40,486)	(12,271)
Total liabilities and stockholders' equity	$ 617,622	$ 662,816

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Assets
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 1,804	$ 1,757
Deposits and other assets, restricted (in dollars)	132	355
Liabilities and stockholders' equity
Installment payment agreement, discount	$ 106	$ 678
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	75,000,000	75,000,000
Common stock, shares issued	45,537,353	45,198,718
Common stock, shares outstanding	45,537,353	45,198,718
Senior Secured 2022 Notes
Liabilities and stockholders' equity
Unamortized debt costs	$ 1,121	$ 1,252
Senior Unsecured Notes
Liabilities and stockholders' equity
Unamortized debt costs	$ 2,703	$ 3,305

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Service Revenue
Service revenue	$ 113,057	$ 103,017	$ 331,304	$ 299,057
Operating expenses:
Network operations (including $161 and $126 of equity-based compensation expense, respectively, exclusive of depreciation and amortization shown separately below)	48,827	45,182	143,976	128,673
Selling, general, and administrative (including $2,830 and $2,578 of equity-based compensation expense, respectively)	30,050	27,318	89,403	85,922
Depreciation and amortization expense	18,804	17,634	55,161	52,517
Total operating expenses	97,681	90,134	288,540	267,112
Loss on debt purchases and installment loan repayment			(587)
Gain on capital lease terminations		1,484		11,593
Gain on equipment transactions	687	1,152	7,071	3,420
Loss on debt extinguishment and redemption				(10,144)
Operating income	16,063	15,519	49,248	36,814
Interest income and other, net	207	50	677	566
Interest expense	(9,891)	(10,002)	(30,200)	(31,000)
Income before income taxes	6,379	5,567	19,725	6,380
Income tax provision	(2,920)	(2,406)	(8,688)	(3,964)
Net income	3,459	3,161	11,037	2,416
Comprehensive income (loss):
Net income	3,459	3,161	11,037	2,416
Foreign currency translation adjustment	688	228	2,795	(5,485)
Comprehensive income (loss)	$ 4,147	$ 3,389	$ 13,832	$ (3,069)
Net income per common share:
Basic and diluted net income per common share (in dollars per share)	$ 0.08	$ 0.07	$ 0.25	$ 0.05
Dividends declared per common share (in dollars per share)	$ 0.38	$ 0.34	$ 1.11	$ 1.11
Weighted-average common shares - basic (in shares)	44,574,583	44,474,724	44,563,279	44,907,505
Weighted-average common shares - diluted (in shares)	44,776,918	44,702,127	44,758,202	45,190,206

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Network operations, equity-based compensation expense	$ 161	$ 126
Selling, general, and administrative, equity-based compensation expense	$ 2,830	$ 2,578

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash flows from operating activities:
Net income	$ 11,037	$ 2,416
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	55,161	52,517
Amortization of debt discount and premium	879	(10)
Equity-based compensation expense (net of amounts capitalized)	7,859	8,944
Losses on debt extinguishment and redemption		10,144
Gain on capital lease termination		(11,593)
Loss on debt purchases and installment loan repayment	(587)
Gains - equipment transactions and other, net	(7,124)	(3,018)
Deferred income taxes	8,453	3,830
Changes in operating assets and liabilities:
Accounts receivable	(2,478)	1,118
Prepaid expenses and other current assets	(3,256)	(3,254)
Accounts payable, accrued liabilities and other long-term liabilities	4,499	766
Deposits and other assets	(1,529)	(50)
Net cash provided by operating activities	74,088	61,810
Cash flows from investing activities:
Purchases of property and equipment	(38,039)	(30,620)
Proceeds from dispositions of assets		111
Net cash used in investing activities	(38,039)	(30,509)
Cash flows from financing activities:
Dividends paid	(50,011)	(50,269)
Purchases of common stock	(1,666)	(39,394)
Purchases of senior unsecured 2021 notes	(10,775)
Net proceeds from issuance of senior secured 2022 notes		248,603
Redemption of senior secured 2018 notes		(251,280)
Proceeds from exercises of stock options	894	288
Principal payments of installment payment agreement	(21,203)	(95)
Principal payments of capital lease obligations	(9,658)	(16,942)
Net cash used in financing activities	(92,419)	(109,089)
Effect of exchange rates changes on cash	930	(2,712)
Net decrease in cash and cash equivalents	(55,440)	(80,500)
Cash and cash equivalents, beginning of period	203,591	287,790
Cash and cash equivalents, end of period	148,151	207,290
Supplemental disclosure of non-cash financing and investing activities:
Non-cash component of network equipment obtained in exchange transactions	7,071	5,717
PP&E obtained for installment payment agreement	19,875	15,602
Fair value of equipment acquired in leases	1,744	595
Capital lease obligations incurred	$ 13,120	$ 17,820

Description of the business and

Description of the business and recent developments:	9 Months Ended
	Sep. 30, 2016
Description of the business and recent developments:
Description of the business and recent developments:	1. Description of the business and recent developments: Reorganization and merger On May 15, 2014, pursuant to the Agreement and Plan of Reorganization (the “Merger Agreement”) by and among Cogent Communications Group, Inc. (“Group”), a Delaware corporation, Cogent Communications Holdings, Inc., a Delaware corporation (“Holdings”) and Cogent Communications Merger Sub, Inc., a Delaware corporation (“Merger Sub”), Group adopted a new holding company organizational structure whereby Group is now a wholly owned subsidiary of Holdings. Holdings is a “successor issuer” to Group pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). References to the “Company” for events that occurred prior to May 15, 2014 refer to Cogent Communications Group, Inc. and its subsidiaries and on and after May 15, 2014 the “Company” refers to Cogent Communications Holdings, Inc. and its subsidiaries. Description of business The Company is a Delaware corporation and is headquartered in Washington, DC. The Company is a facilities-based provider of low-cost, high-speed Internet access and Internet Protocol (“IP”) communications services. The Company’s network is specifically designed and optimized to transmit data using IP. The Company delivers its services primarily to small and medium-sized businesses, communications service providers and other bandwidth-intensive organizations in North America, Europe and Asia. The Company offers on-net Internet access services exclusively through its own facilities, which run from its network to its customers’ premises. The Company is not dependent on local telephone companies to serve its customers for its on-net Internet access services because of its integrated network architecture. The Company offers its on-net services to customers located in buildings that are physically connected to its network. The Company’s on-net service consists of high-speed Internet access and IP connectivity ranging from 100 Megabits per second to 100 Gigabits per second of bandwidth. The Company provides its on-net Internet access services to its corporate and net-centric customers. The Company’s corporate customers are located in multi-tenant office buildings and typically include law firms, financial services firms, advertising and marketing firms and other professional services businesses. The Company’s net-centric customers include bandwidth-intensive users such as universities, other Internet service providers, telephone companies, cable television companies, web hosting companies, content delivery network companies and commercial content and application service providers. These net-centric customers obtain the Company’s services in carrier neutral data centers and in the Company’s data centers. The Company operates data centers throughout North America and Europe that allow its customers to collocate their equipment and access the Company’s network. In addition to providing its on-net services, the Company provides Internet connectivity to customers that are not located in buildings directly connected to its network. The Company provides this off-net service primarily to corporate customers using other carriers’ facilities to provide the “last mile” portion of the link from the customers’ premises to the Company’s network. The Company also provides certain non-core services that resulted from acquisitions. The Company continues to support but does not actively sell these non-core services. Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the unaudited condensed consolidated financial statements reflect all normal recurring adjustments that the Company considers necessary for the fair presentation of its results of operations and cash flows for the interim periods covered, and of the financial position of the Company at the date of the interim condensed consolidated balance sheet. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The operating results for interim periods are not necessarily indicative of the operating results for the entire year. While the Company believes that the disclosures are adequate to not make the information misleading, these interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in its annual report on Form 10-K for the year ended December 31, 2015. The accompanying unaudited consolidated financial statements include all wholly-owned subsidiaries. All inter-company accounts and activity have been eliminated. Use of estimates The preparation of consolidated financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates. Financial instruments At September 30, 2016, the carrying amount of cash and cash equivalents, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses approximated fair value because of the short-term nature of these instruments. The Company measures its cash equivalents at amortized cost, which approximates fair value based upon quoted market prices (Level 1). Based upon recent trading prices (Level 2 — market approach) at September 30, 2016 the fair value of the Company’s $189.2 million senior unsecured notes was $193.0 million and the fair value of the Company’s $250.0 million senior secured notes was $256.6 million. The Company was party to letters of credit totaling $0.1 million as of September 30, 2016 and $0.3 million as of December 31, 2015. These letters of credit are secured by investments that are restricted and included in other assets. Gross receipts taxes, universal service fund and other surcharges Revenue recognition standards include guidance relating to taxes or surcharges assessed by a governmental authority that are directly imposed on a revenue-producing transaction between a seller and a customer and may include, but are not limited to, gross receipts taxes, excise taxes, Universal Service Fund fees and certain state regulatory fees. Such charges may be presented gross or net based upon the Company’s accounting policy election. The Company records certain excise taxes and surcharges on a gross basis and includes them in its revenues and costs of network operations. Excise taxes and surcharges billed to customers and recorded on a gross basis (as service revenue and network operations expense) were $2.4 million, $6.5 million, $1.8 million and $1.9 million for the three and nine months ended September 30, 2016 and September 30, 2015, respectively. Basic and diluted net income (loss) per common share Basic earnings per share (“EPS”) excludes dilution for common stock equivalents and is computed by dividing net income or (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS is based on the weighted-average number of shares of common stock outstanding during each period, adjusted for the effect of dilutive common stock equivalents. Shares of restricted stock are included in the computation of basic EPS as they vest and are included in diluted EPS, to the extent they are dilutive, determined using the treasury stock method. For the three and nine months ended September 30, 2016 and 2015, the Company’s employees exercised options for 10,995, 39,473, 6,883 and 19,507 common shares, respectively. The following details the determination of diluted weighted average shares: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Weighted average common shares - basic Dilutive effect of stock options Dilutive effect of restricted stock Weighted average common shares - diluted The following details unvested shares of restricted common stock as well as the anti-dilutive effects of stock options and restricted stock awards outstanding: Three Months Three Months Nine Months Nine Months Unvested shares of restricted common stock Anti-dilutive options for common stock Anti-dilutive shares of restricted common stock — Recent accounting pronouncements—to be adopted In February 2016, the FASB issued ASU No. 2016-02, Leases . The ASU will replace most existing accounting for lease guidance when it becomes effective. The new standard is effective for the Company beginning on January 1, 2019. Early application is permitted. The standard must be adopted using the modified retrospective approach. The standard will require the Company to record a right to use asset and a lease liability for most of the Company’s leases including the Company’s leases currently treated as operating leases. The Company is evaluating the effect that ASU 2016-02 will have on its consolidated financial statements and related disclosures and has not yet determined the effect of the standard on its ongoing financial reporting. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers , which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company beginning on January 1, 2018. Early application is permitted for annual periods beginning after December 31, 2016. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

Property and equipment_

Property and equipment:	9 Months Ended
	Sep. 30, 2016
Property and equipment:
Property and equipment:	2. Property and equipment: Depreciation and amortization expense related to property and equipment and capital leases was $18.8 million, $55.2 million, $17.6 million and $52.5 million for the three and nine months ended September 30, 2016 and 2015, respectively. The Company capitalized salaries and related benefits of employees working directly on the construction and build-out of its network of $2.2 million, $6.6 million, $2.1 million and $6.3 million for the three and nine months ended September 30, 2016 and 2015, respectively. Exchange agreement In the three and nine months ended September 30, 2016 and 2015, the Company exchanged certain used network equipment and cash consideration for new network equipment. The fair value of the equipment received was estimated to be $1.6 million, $14.1 million, $2.7 million and $11.0 million, respectively. After considering the fair value of the new network equipment less the carrying amount of the returned used network equipment and the cash paid, the transactions resulted in gains of $0.7 million, $7.1 million, $1.1 million and $3.3 million respectively. The estimated fair value of the equipment received was based upon the cash consideration price the Company pays for the new network equipment on a standalone basis (Level 3). Installment payment agreement In March 2015, the Company entered into an installment payment agreement (“IPA”) with a vendor. Under the IPA the Company is able to purchase up to $25.0 million of network equipment in exchange for interest free note obligations each with a twenty-four month term. There are no payments under each note obligation for the first six months followed by eighteen equal installment payments for the remaining eighteen month term. In June 2016, the Company elected to repay the outstanding $17.1 million principal balance of the IPA prior to its maturity resulting in a loss of $0.4 million from the remaining unamortized discount. During the three months ended September 30, 2016 the Company entered into additional note obligations totaling $2.7 million. As of September 30, 2016 and December 31, 2015 there was $2.7 million and $21.2 million, respectively, of note obligations outstanding under the IPA, secured by the related equipment. The Company records the net present value of each note obligation utilizing an imputed interest rate. The resulting discount of $0.1 million and $0.8 million as of September 30, 2016 and December 31, 2015, respectively, is amortized over the note term using the effective interest rate method. Gains on capital lease terminations In March 2015 the Company elected to terminate certain IRU capital lease obligations in Spain with a vendor. The Company has obtained alternative fiber to serve its customers in Spain. Under its estimate of the termination provisions of the related contracts the Company has recorded an estimated termination liability of $8.1 million included in accrued and other current liabilities. The difference between the remaining carrying amount of the related IRU capital lease liabilities ($29.9 million), the remaining net book value of the IRU assets ($10.0 million) and the termination liability and amounts due through the termination date was recorded as a gain on capital lease termination of $10.1 million. In July 2015, the Company settled a dispute for the payment of the remaining balances for certain IRU capital lease obligations in Europe with a vendor. The IRU assets were fully depreciated in 2012 when the related fiber was replaced and was no longer used by the Company. The difference between the remaining net present value of the related IRU capital lease obligations ($1.8 million) and the settlement liability ($0.4 million) was recorded as a $1.5 million gain on termination of capital lease obligations.

Long-term debt_

Long-term debt:	9 Months Ended
	Sep. 30, 2016
Long-term debt:
Long-term debt:	3. Long-term debt: Senior unsecured notes- $189.2 million Group is obligor on $189.2 million (originally $200.0 million) of 5.625% Senior Notes due 2021 (the “2021 Notes”). The 2021 Notes were sold in private offerings for resale to qualified institutional buyers pursuant to SEC Rule 144A. Holdings provided a guarantee of the 2021 Notes but Holdings is not subject to the covenants under the indenture. In the second quarter of 2016, the Company paid $10.9 million for the purchase of $10.8 million of par value and accrued interest on its 2021 Notes reducing the principal amount to $189.2 million and resulting in a loss of $0.2 million. The loss resulted from the write off of the remaining unamortized debt issuance costs related to the purchased notes. Debt extinguishment, redemption and new debt issuance- $250.0 million senior secured notes In March 2015, Group redeemed its $240.0 million 8.375% senior notes due in 2018 (the “2018 Notes”) with the proceeds from its February 2015 issuance of $250.0 million of 5.375% senior secured notes (the “2022 Notes”) and existing cash on hand. In February 2015 the Company deposited $251.6 million with the trustee for the benefit of the holders of the 2018 Notes in order to redeem on March 12, 2015 the entire outstanding amount of 2018 Notes at a redemption price of 104.188% of the $240.0 million principal amount thereof plus accrued and unpaid interest. As a result of this transaction the Company incurred a loss on debt extinguishment and redemption of $10.1 million. The 2022 Notes were sold in private offerings for resale to qualified institutional buyers pursuant to SEC Rule 144A and mature on March 1, 2022. Interest accrues at 5.375% beginning on February 20, 2015 and is paid semi-annually in arrears on March 1 and September 1 of each year, commencing on September 1, 2015. The net proceeds from the offering were $248.7 million after deducting discounts and commissions and offering expenses. Senior secured notes- $240.0 million On January 26, 2011 and on August 19, 2013, the Company issued its 8.375% 2018 Notes for aggregate principal amounts of $175.0 million and $65.0 million, respectively, in private offerings for resale to qualified institutional buyers pursuant to SEC Rule 144A. The 2018 Notes were secured and bore interest at 8.375% per annum. Interest was payable in cash semiannually in arrears on February 15 and August 15, of each year. On January 26, 2011, the Company received net proceeds of $170.5 million after deducting $4.5 million of issuance costs from issuing $175.0 million of its 2018 Notes. On August 19, 2013, the Company received net proceeds of approximately $69.9 million after deducting $1.0 million of issuance costs from issuing $65.0 million of 2018 Notes. The 2018 Notes sold in August 2013 were sold at 109.00% of par value. The resulting $5.9 million premium was being amortized as a reduction to interest expense to the maturity date using the effective interest rate method. In March 2015, the 2018 Notes were extinguished and redeemed with the proceeds of the Company’s issuance of its $250.0 million of 2022 Notes and cash on hand. Limitations under the indentures The indentures governing the 2022 and 2021 Notes, among other things, limit the Company’s ability to incur indebtedness; to pay dividends or make other distributions; to make certain investments and other restricted payments; to create liens; consolidate, merge, sell or otherwise dispose of all or substantially all of its assets; to incur restrictions on the ability of a subsidiary to pay dividends or make other payments; and to enter into certain transactions with its affiliates. Limitations on the ability to incur additional indebtedness (excluding IRU agreements incurred in the normal course of business) include a restriction on incurring additional indebtedness if the Company’s consolidated leverage ratio, as defined in the indentures, is greater than 5.0. The indentures prohibit certain payments, such as dividends and stock purchases, when the Company’s consolidated leverage ratio, as defined by the indentures, is greater than 4.25. A certain amount of such unrestricted payments is permitted notwithstanding this prohibition. The unrestricted payment amount may be increased by the Company’s consolidated cash flow, as defined in the indentures, as long as the Company’s consolidated leverage ratio is less than 4.25. The Company’s consolidated leverage ratio is currently below 4.25 as of September 30, 2016, and as a result a total of $169.4 million is permitted for investment payments including dividends and stock purchases.

Commitments and contingencies_

Commitments and contingencies:	9 Months Ended
	Sep. 30, 2016
Commitments and contingencies:
Commitments and contingencies:	4. Commitments and contingencies : Current and potential litigation In accordance with the accounting guidance for contingencies, the Company accrues its estimate of a contingent liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Where it is probable that a liability has been incurred and there is a range of expected loss for which no amount in the range is more likely than any other amount, the Company accrues at the low end of the range. The Company reviews its accruals at least quarterly and adjusts them to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular matter. The Company has taken certain positions related to its obligations for leased circuits for which it is reasonably possible could result in a loss of up to $2.3 million in excess of the amount accrued at September 30, 2016. In December 2011, certain former sales employees of the Company filed a collective action against the Company in the United States District Court, Southern District of Texas, Houston Division alleging misclassification of the Company’s sales employees throughout the United States in violation of the Fair Labor Standards Act. The lawsuit sought to recover pay for allegedly unpaid overtime and other damages, including attorney’s fees. In March 2014, the judge de-certified the collective action. Each of the former employees that opted-in to the collective action retained the right to file an individual action. Approximately 70 former employees did so. The Company has settled a number of the cases that were filed and made the required settlement payments. Currently, only one case in California remains (Ambrosia v. Cogent Communications, Inc. in the U. S. District Court for the Northern District of California). On January 4, 2016, the judge provisionally certified a class and collective action related to the employees in California. The Company denies the claims and believes that the claims for unpaid overtime are without merit. The Company believes its classification of sales employees is in compliance with applicable law. In the ordinary course of business the Company is involved in other legal activities and claims. Because such matters are subject to many uncertainties and the outcomes are not predictable with assurance, the liability related to these legal actions and claims cannot be determined with certainty. Management does not believe that such claims and actions will have a material impact on the Company’s financial condition or results of operations. Judgment is required in estimating the ultimate outcome of any dispute resolution process, as well as any other amounts that may be incurred to conclude the negotiations or settle any litigation. Actual results may differ from these estimates under different assumptions or conditions and such differences could be material.

Income taxes_

Income taxes:	9 Months Ended
	Sep. 30, 2016
Income taxes:
Income taxes:	5. Income taxes: The components of income (loss) before income taxes consist of the following (in thousands): Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Domestic $ $ $ $ Foreign ) ) ) ) Total $ $ $ $

Common stock buyback program_

Common stock buyback program:	9 Months Ended
	Sep. 30, 2016
Common stock buyback program:
Common stock buyback program:	6. Common stock buyback program: The Company’s Board of Directors has approved purchases of the Company’s common stock under a buyback program (the “Buyback Program”) through December 31, 2016. At September 30, 2016, there was approximately $46.1 million remaining for purchases under the Buyback Program. During the three and nine months ended September 30, 2016 and 2015 the Company purchased 46,983, 46,983, 0.4 million and 1.2 million shares of its common stock for $1.7 million, $1.7 million, $12.2 million and $39.4 million, respectively.

Dividends on common stock_

Dividends on common stock:	9 Months Ended
	Sep. 30, 2016
Dividends on common stock:
Dividends on common stock:	7. Dividends on common stock: Dividends are recorded as a reduction to retained earnings. Dividends on unvested restricted shares of common stock are paid as the awards vest. The Company’s initial quarterly dividend payment was made in the third quarter of 2012. On October 31, 2016, the Company’s Board of Directors approved the payment of our quarterly dividend of $0.40 per common share. The dividend for the fourth quarter of 2016 will be paid to holders of record on November 22, 2016. This estimated $16.9 million dividend payment is expected to be made on December 9, 2016. The payment of any future dividends and any other returns of capital, including stock buybacks, will be at the discretion of the Company’s Board of Directors and may be reduced, eliminated or increased and will be dependent upon the Company’s financial position, results of operations, available cash, cash flow, capital requirements, limitations under the Company’s debt indentures and other factors deemed relevant by the Company’s Board of Directors. The Company is a Delaware Corporation and under the General Corporate Law of the State of Delaware distributions may be restricted including a restriction that distributions, including stock purchases and dividends, do not result in an impairment of a corporation’s capital, as defined under Delaware Law. The indentures governing the Company’s notes limit the Company’s ability to return cash to its stockholders.

Incentive award plan_

Incentive award plan:	9 Months Ended
	Sep. 30, 2016
Incentive award plan:
Incentive award plan	8. Incentive award plan: The Company has an award plan, the 2004 Incentive Award Plan, as amended (the “Award Plan”), under which grants of stock and options are made. In May 2016 the Company granted 73,450 restricted shares under the Award Plan with a grant date fair value of $2.9 million that are subject to certain performance conditions based upon the Company’s operating metrics and will be recognized as equity-based compensation expense on a straight line basis over the service period. In the second quarter of 2016, the Company also granted 247,180 restricted shares to certain of its employees that will vest on a quarterly basis in 2019 and over a four year period. These restricted shares had a grant date fair value of $9.6 million and will be recognized as equity-based compensation expense on a straight line basis over the service period.

Related party transactions_

Related party transactions:	9 Months Ended
	Sep. 30, 2016
Related party transactions:
Related party transactions:	9. Related party transactions: Office leases The Company’s headquarters was located in an office building owned by Niobium LLC (a successor to 6715 Kenilworth Avenue Partnership). The two owners of Niobium LLC are the Company’s Chief Executive Officer, David Schaeffer, who has a 51% interest in Niobium LLC and his wife who has a 49% interest. The lease was scheduled to end on August 31, 2016 and was cancellable by the Company upon 60 days’ notice. The Company terminated the lease effective as of May 10, 2015. In April 2015, the Company entered into a new lease agreement for its headquarters building with Sodium LLC whose two owners are the Company’s Chief Executive Officer, who has a 51% interest in Sodium LLC and his wife who has a 49% interest. The Company moved into the new headquarters building in May 2015. The fixed annual rent for the new headquarters building is $1.0 million per year plus an allocation of taxes and utilities. The lease term is for five years and is cancellable by the Company upon 60 days’ notice. The Company’s audit committee reviews and approves all transactions with related parties. The Company paid $0.5 million, $1.3 million, $0.3 million and $0.7 million in the three and nine months ended September 30, 2016 and 2015, respectively, for rent and related costs (including taxes and utilities) to these lessors for these leases.

Segment information_

Segment information:	9 Months Ended
	Sep. 30, 2016
Segment information:
Segment information:	10. Segment information: The Company operates as one operating segment. The Company’s service revenue and long lived assets by geographic region are as follows (in thousands): Three Months Three Months Nine Months Nine Months Revenues North America $ $ $ $ Europe Total $ $ $ $ September 30, December 31, Long lived assets, net North America $ $ Europe Total $ $ The majority of North American revenue consists of services delivered within the United States.

Description of the business a17

Description of the business and recent developments: (Policies)	9 Months Ended
	Sep. 30, 2016
Description of the business and recent developments:
Basis of presentation	Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the unaudited condensed consolidated financial statements reflect all normal recurring adjustments that the Company considers necessary for the fair presentation of its results of operations and cash flows for the interim periods covered, and of the financial position of the Company at the date of the interim condensed consolidated balance sheet. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The operating results for interim periods are not necessarily indicative of the operating results for the entire year. While the Company believes that the disclosures are adequate to not make the information misleading, these interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in its annual report on Form 10-K for the year ended December 31, 2015. The accompanying unaudited consolidated financial statements include all wholly-owned subsidiaries. All inter-company accounts and activity have been eliminated.
Use of estimates	Use of estimates The preparation of consolidated financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates.
Financial instruments	Financial instruments At September 30, 2016, the carrying amount of cash and cash equivalents, accounts receivable, prepaid and other current assets, accounts payable and accrued expenses approximated fair value because of the short-term nature of these instruments. The Company measures its cash equivalents at amortized cost, which approximates fair value based upon quoted market prices (Level 1). Based upon recent trading prices (Level 2 — market approach) at September 30, 2016 the fair value of the Company’s $189.2 million senior unsecured notes was $193.0 million and the fair value of the Company’s $250.0 million senior secured notes was $256.6 million. The Company was party to letters of credit totaling $0.1 million as of September 30, 2016 and $0.3 million as of December 31, 2015. These letters of credit are secured by investments that are restricted and included in other assets.
Gross receipts taxes, universal service fund and other surcharges	Gross receipts taxes, universal service fund and other surcharges Revenue recognition standards include guidance relating to taxes or surcharges assessed by a governmental authority that are directly imposed on a revenue-producing transaction between a seller and a customer and may include, but are not limited to, gross receipts taxes, excise taxes, Universal Service Fund fees and certain state regulatory fees. Such charges may be presented gross or net based upon the Company’s accounting policy election. The Company records certain excise taxes and surcharges on a gross basis and includes them in its revenues and costs of network operations. Excise taxes and surcharges billed to customers and recorded on a gross basis (as service revenue and network operations expense) were $2.4 million, $6.5 million, $1.8 million and $1.9 million for the three and nine months ended September 30, 2016 and September 30, 2015, respectively.
Basic and diluted net income (loss) per common share	Basic and diluted net income (loss) per common share Basic earnings per share (“EPS”) excludes dilution for common stock equivalents and is computed by dividing net income or (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted EPS is based on the weighted-average number of shares of common stock outstanding during each period, adjusted for the effect of dilutive common stock equivalents. Shares of restricted stock are included in the computation of basic EPS as they vest and are included in diluted EPS, to the extent they are dilutive, determined using the treasury stock method. For the three and nine months ended September 30, 2016 and 2015, the Company’s employees exercised options for 10,995, 39,473, 6,883 and 19,507 common shares, respectively. The following details the determination of diluted weighted average shares: Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Weighted average common shares - basic Dilutive effect of stock options Dilutive effect of restricted stock Weighted average common shares - diluted The following details unvested shares of restricted common stock as well as the anti-dilutive effects of stock options and restricted stock awards outstanding: Three Months Three Months Nine Months Nine Months Unvested shares of restricted common stock Anti-dilutive options for common stock Anti-dilutive shares of restricted common stock —
Recent accounting pronouncements-to be adopted	Recent accounting pronouncements—to be adopted In February 2016, the FASB issued ASU No. 2016-02, Leases . The ASU will replace most existing accounting for lease guidance when it becomes effective. The new standard is effective for the Company beginning on January 1, 2019. Early application is permitted. The standard must be adopted using the modified retrospective approach. The standard will require the Company to record a right to use asset and a lease liability for most of the Company’s leases including the Company’s leases currently treated as operating leases. The Company is evaluating the effect that ASU 2016-02 will have on its consolidated financial statements and related disclosures and has not yet determined the effect of the standard on its ongoing financial reporting. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers , which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company beginning on January 1, 2018. Early application is permitted for annual periods beginning after December 31, 2016. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

Description of the business a18

Description of the business and recent developments: (Tables)	9 Months Ended
	Sep. 30, 2016
Description of the business and recent developments:
Schedule of diluted weighted average shares	Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Weighted average common shares - basic Dilutive effect of stock options Dilutive effect of restricted stock Weighted average common shares - diluted
Schedule of unvested and anti-dilutive shares	Three Months Three Months Nine Months Nine Months Unvested shares of restricted common stock Anti-dilutive options for common stock Anti-dilutive shares of restricted common stock —

Income taxes_ (Tables)

Income taxes: (Tables)	9 Months Ended
	Sep. 30, 2016
Income taxes:
Schedule of components of income (loss) before income taxes	The components of income (loss) before income taxes consist of the following (in thousands): Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended Domestic $ $ $ $ Foreign ) ) ) ) Total $ $ $ $

Segment information_ (Tables)

Segment information: (Tables)	9 Months Ended
	Sep. 30, 2016
Segment information:
Schedule of service revenues and long lived assets by geographic region	The Company’s service revenue and long lived assets by geographic region are as follows (in thousands): Three Months Three Months Nine Months Nine Months Revenues North America $ $ $ $ Europe Total $ $ $ $ September 30, December 31, Long lived assets, net North America $ $ Europe Total $ $

Description of the business a21

Description of the business and recent developments: (Details)	9 Months Ended
	Sep. 30, 2016MB
Minimum
On-net service - high-speed Internet access and IP connectivity
Speed per second of bandwidth (in megabits)	100
Maximum
On-net service - high-speed Internet access and IP connectivity
Speed per second of bandwidth (in megabits)	100

Description of the business a22

Description of the business and recent developments: Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Financial instruments
Senior unsecured notes	$ 186,522	$ 196,695
Letters of credit, outstanding amount	100	$ 300
Senior Unsecured Notes | Level 2
Financial instruments
Senior unsecured notes	189,200
Debt instrument, fair value amount	193,000
Senior Secured Notes | Level 2
Financial instruments
Debt instrument, fair value amount	256,600
Senior secured notes	$ 250,000

Description of the business a23

Description of the business and recent developments: Gross receipts taxes, universal service fund and other surcharges (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Gross receipts taxes, universal service fund and other surcharges
Excise and Sales Taxes	$ 2.4	$ 1.8	$ 6.5	$ 1.9

Description of the business a24

Description of the business and recent developments: Basic and diluted net (loss) income per common share (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Basic and diluted net (loss) income per common share
Weighted-average common shares - basic (in shares)	44,574,583	44,474,724	44,563,279	44,907,505
Weighted average common shares-diluted	44,776,918	44,702,127	44,758,202	45,190,206
Stock options
Basic and diluted net (loss) income per common share
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period	10,995	6,883	39,473	19,507
Dilutive effect of awards (in shares)	29,400	33,370	33,792	42,182
Diluted weighted average shares
Anti-dilutive shares	75,687	136,220	87,611	118,517
Restricted stock
Basic and diluted net (loss) income per common share
Dilutive effect of awards (in shares)	172,935	194,033	161,131	240,519
Diluted weighted average shares
Unvested shares of restricted common stock	999,464	1,028,197	999,464	1,028,197
Anti-dilutive shares		617,243	126,993	360,101

Property and equipment_ Propert

Property and equipment: Property and equipment additional information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Property and equipment
Depreciation and amortization expense	$ 18,804	$ 17,634	$ 55,161	$ 52,517
Capitalized salaries and related benefits of employees	2,200	2,100	6,600	6,300
Gain (Loss) on Asset Exchange Transactions			7,071	5,717
Property, equipment and capital leases
Property and equipment
Depreciation and amortization expense	18,800	17,600	55,200	52,500
Network equipment
Property and equipment
Gain (Loss) on Asset Exchange Transactions	700	1,100	7,100	3,300
Network equipment | Level 3
Property and equipment
Fair market value of equipment received in exchange	$ 1,600	$ 2,700	$ 14,100	$ 11,000

Property and equipment_ Purchas

Property and equipment: Purchase and installment payment agreements (Details) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Mar. 31, 2015USD ($)payment	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Jun. 30, 2016USD ($)	Dec. 31, 2015USD ($)
Installment payment agreement
Gains on equipment transactions		$ (687)	$ (1,152)	$ (7,071)	$ (3,420)
Network equipment | Note obligations
Installment payment agreement
Amount of installment payment agreement	$ 25,000
Term of debt	24 months
Number of payments during the first six months | payment	0
Number of equal payments | payment	18
Remaining term	18 months
Outstanding obligation		2,700		2,700		$ 17,100	$ 21,200
Gains on equipment transactions				400
Unamortized discount		$ 100		$ 100			$ 800

Property and equipment_ Gain on

Property and equipment: Gain on capital lease termination (Details) - USD ($) $ in Thousands	1 Months Ended		9 Months Ended
	Jul. 31, 2015	Mar. 31, 2015	Sep. 30, 2015	Sep. 30, 2016	Dec. 31, 2015
Gain on capital lease termination
Net book value				$ 370,749	$ 360,136
Gain on capital lease termination			$ 11,593
Vendor in Spain
Gain on capital lease termination
Estimated termination liability of IRU capital leases		$ 8,100
Indefeasible rights of use (IRUs) | Vendor in Spain
Gain on capital lease termination
Carrying value of lease liabilities		29,900
Net book value		10,000
Gain on capital lease termination		$ 10,100
Indefeasible rights of use (IRUs) | Vendor In Europe Member
Gain on capital lease termination
Carrying value of lease liabilities	$ 1,800
Gain on capital lease termination	1,500
Settlement liability	$ 400

Long-term debt_ Senior unsecure

Long-term debt: Senior unsecured notes- $200.0 million (Details) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2016USD ($)	Sep. 30, 2016USD ($)
Senior unsecured notes- $200.0 million 2021 Notes
Loss on debt purchases		$ (587)
Senior Unsecured Notes | Cogent Finance
Senior unsecured notes- $200.0 million 2021 Notes
Repurchased amount	$ 189,200	189,200
Original amount of debt	$ 200,000	$ 200,000
Interest rate (as a percent)	5.625%	5.625%
Interest expense on original debt	$ 10,900
Interest expense on repurchased debt	10,800
Loss on debt purchases	$ 200

Long-term debt_ Debt extinguish

Long-term debt: Debt extinguishment, redemption and new debt issuance- $250.0 million (Details) - USD ($) $ in Thousands	Mar. 12, 2015	Mar. 31, 2015	Feb. 28, 2015	Mar. 31, 2015	Sep. 30, 2016	Sep. 30, 2015	Aug. 19, 2013	Jan. 26, 2011
Debt extinguishment, redemption and new debt issuance- $250.0 million
Amount of debt redeemed						$ 251,280
Loss on debt extinguishment and redemption				$ (10,100)		$ (10,144)
Senior Secured 2018 Notes
Debt extinguishment, redemption and new debt issuance- $250.0 million
Amount of debt redeemed		$ 240,000
Interest rate (as a percent)		8.375%		8.375%			8.375%	8.375%
Aggregate principal amount of debt issued							$ 65,000	$ 175,000
Amount deposited with the trustee for the benefit of the holders			$ 251,600
Percentage of principal amount that the holders of the Convertible Notes may require the Company to repurchase	104.188%
Aggregate face value of debt repurchased	$ 240,000
Senior Secured 2022 Notes
Debt extinguishment, redemption and new debt issuance- $250.0 million
Interest rate (as a percent)		5.375%	5.375%	5.375%
Aggregate principal amount of debt issued		$ 250,000	$ 250,000	$ 250,000
Net proceeds from issuance of senior secured 2022 notes					$ 248,700

Long-term debt_ Limitations und

Long-term debt: Limitations under the Indentures (Details) $ in Millions	9 Months Ended
	Sep. 30, 2016USD ($)
Limitations under the Indentures
Permitted investments and payments including dividends and stock purchases	$ 169.4
Maximum
Limitations under the Indentures
Consolidated leverage ratio to be maintained to increase amount of permitted investments and payments by consolidated cash flow	4.25
Senior Unsecured Notes | Minimum
Limitations under the Indentures
Consolidated leverage ratio to restrict on incurring additional indebtedness	5

Long-term debt_ Senior secured

Long-term debt: Senior secured notes - $240.0 millions (Details) - USD ($) $ in Millions	Aug. 19, 2013	Jan. 26, 2011	Mar. 31, 2015	Feb. 28, 2015
Senior Secured 2022 Notes
Senior secured notes-2018 Notes
Interest rate (as a percent)			5.375%	5.375%
Aggregate principal amount of debt issued			$ 250	$ 250
Senior Secured 2018 Notes
Senior secured notes-2018 Notes
Interest rate (as a percent)	8.375%	8.375%	8.375%
Aggregate principal amount of debt issued	$ 65	$ 175
Proceeds from issuance of long-term debt, net of issuance costs	69.9	170.5
Debt issuance costs	1	$ 4.5
Senior secured notes, premium (in dollars)	$ 5.9
Premium price of debt instrument (as a percent)	109.00%

Commitments and contingencies_

Commitments and contingencies: (Details) $ in Millions	9 Months Ended
	Sep. 30, 2016USD ($)employee
Former Sales Employees Fair Labor Standards Act
Commitments and contingencies
Number of employees who opted to file an action | employee	70
Maximum | Leased circuit and dark fiber costs
Commitments and contingencies
Estimate of possible loss in excess of the amount accrued | $	$ 2.3

Income taxes_ (Details)

Income taxes: (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Components of (loss) income before income taxes
Domestic	$ 11,971	$ 9,343	$ 36,589	$ 10,245
Foreign	(5,592)	(3,776)	(16,864)	(3,865)
Income before income taxes	$ 6,379	$ 5,567	$ 19,725	$ 6,380

Common stock buyback programs_

Common stock buyback programs: (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Common stock buyback program:
Remaining authorized amount of common stock repurchases under the Buyback Program	$ 46.1		$ 46.1
Repurchase of common stock (in shares)	46,983	400,000	46,983	1,200,000
Cost of shares of common stock repurchase under buyback program	$ 1.7	$ 12.2	$ 1.7	$ 39.4

Dividends on common stock_ (Det

Dividends on common stock: (Details) - USD ($) $ / shares in Units, $ in Thousands	Dec. 09, 2016	Oct. 31, 2016	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Dividends on common stock and return of capital program
Dividends declared per common share (in dollars per share)		$ 0.40	$ 0.38	$ 0.34	$ 1.11	$ 1.11
Dividends paid					$ 50,011	$ 50,269
Expected
Dividends on common stock and return of capital program
Dividends paid	$ 16,900

Incentive award plan (Details)

Incentive award plan (Details) - 2004 Incentive Award Plan - Restricted stock - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	May 31, 2016	Sep. 30, 2016
Incentive award plan
Number of shares granted to employees	73,450	247,180
Vesting period		4 years
Fair value of shares	$ 2.9	$ 9.6

Related party transactions_ (De

Related party transactions: (Details) $ in Millions	1 Months Ended	3 Months Ended		4 Months Ended	9 Months Ended
	Apr. 30, 2015USD ($)item	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	May 10, 2015item	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)
Office lease
Payment for rent and related costs (in dollars) | $		$ 0.5	$ 0.3		$ 1.3	$ 0.7
Niobium LLC
Office lease
Number of owners of the LLC | item				2
Niobium LLC | Lease
Office lease
Notice period for cancellation of lease				60 days
Sodium LLC
Office lease
Number of owners of the LLC | item	2
Sodium LLC | Lease
Office lease
Notice period for cancellation of lease	60 days
Fixed annual rent | $	$ 1
Lease term (in years)	5 years
Chief Executive Officer | Niobium LLC
Office lease
Ownership interest of related parties held in the partnership (as a percent)				51.00%
Chief Executive Officer | Sodium LLC
Office lease
Ownership interest of related parties held in the partnership (as a percent)	51.00%
Chief Executive Officer's wife | Niobium LLC
Office lease
Ownership interest of related parties held in the partnership (as a percent)				49.00%
Chief Executive Officer's wife | Sodium LLC
Office lease
Ownership interest of related parties held in the partnership (as a percent)	49.00%

Segment information_ (Details)

Segment information: (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)segment	Sep. 30, 2015USD ($)	Dec. 31, 2015USD ($)
Segment information
Number of operating segments | segment			1
Revenues	$ 113,057	$ 103,017	$ 331,304	$ 299,057
Long lived assets, net	370,775		370,775		$ 360,163
North America
Segment information
Revenues	94,597	85,084	276,080	245,914
Long lived assets, net	289,275		289,275		285,187
Europe
Segment information
Revenues	18,460	$ 17,933	55,224	$ 53,143
Long lived assets, net	$ 81,500		$ 81,500		$ 74,976