Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | Apr. 15, 2014 | |
Document Information [Line Items] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Trading Symbol | 'IQNT | ' |
Entity Registrant Name | 'INTELIQUENT, INC. | ' |
Entity Central Index Key | '0001292653 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 32,442,499 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $70,679 | $77,004 |
Receivables, net of allowance of $695 and $900, respectively | 38,100 | 22,200 |
Deferred income taxes-current | 136 | 720 |
Prepaid expenses | 3,251 | 2,375 |
Other current assets | 1,245 | 1,977 |
Total current assets | 113,411 | 104,276 |
Property and equipment - net | 25,292 | 25,815 |
Restricted cash | 125 | 125 |
Deferred income taxes-non-current | 5,824 | 5,495 |
Other assets | 1,486 | 1,534 |
Total assets | 146,138 | 137,245 |
Current liabilities: | ' | ' |
Accounts payable | 2,846 | 2,176 |
Accrued liabilities: | ' | ' |
Taxes payable | 2,477 | 2,437 |
Circuit cost | 9,418 | 8,987 |
Rent | 2,071 | 2,071 |
Payroll and related items | 2,584 | 3,079 |
Other | 1,304 | 1,674 |
Total current liabilities | 20,700 | 20,424 |
Shareholders' equity: | ' | ' |
Preferred stock - par value of $.001; 50,000 authorized shares; no shares issued and outstanding at March 31, 2014 and December 31, 2013 | ' | ' |
Common stock - par value of $.001; 150,000 authorized shares; 32,383 shares and 32,215 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively | 32 | 32 |
Less treasury stock, at cost; 3,351 shares at March 31, 2014 and December 31, 2013 | -51,668 | -51,668 |
Additional paid-in capital | 205,847 | 203,989 |
Accumulated deficit | -28,773 | -35,532 |
Total shareholders' equity | 125,438 | 116,821 |
Total liabilities and shareholders' equity | $146,138 | $137,245 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Receivables, allowance | $695 | $900 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, authorized shares | 50,000 | 50,000 |
Preferred stock, shares issued | ' | ' |
Preferred stock, shares outstanding | ' | ' |
Common stock, par value | $0.00 | $0.00 |
Common stock, authorized shares | 150,000 | 150,000 |
Common stock, shares issued | 32,383 | 32,215 |
Common stock, shares outstanding | 32,383 | 32,215 |
Treasury stock, at cost, shares | 3,351 | 3,351 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Income (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Revenue | $56,217 | $59,288 |
Operating expense: | ' | ' |
Network and facilities expense (excluding depreciation and amortization) | 24,890 | 24,636 |
Operations | 7,307 | 7,798 |
Sales and marketing | 676 | 2,034 |
General and administrative | 3,800 | 4,499 |
Depreciation and amortization | 3,141 | 4,513 |
Loss on sale of Americas Data assets | 1,081 | ' |
Total operating expense | 40,895 | 43,480 |
Income from operations | 15,322 | 15,808 |
Other (expense) income: | ' | ' |
Interest (expense) income | -2 | 39 |
Other expense | ' | -5 |
Total other (expense) income | -2 | 34 |
Income from continuing operations before provision for income taxes | 15,320 | 15,842 |
Provision for income taxes | 6,127 | 3,606 |
Income from continuing operations | 9,193 | 12,236 |
Loss from discontinued operations, net of provision for income taxes | ' | -5,336 |
Net income | $9,193 | $6,900 |
Earnings per share-continuing operations: | ' | ' |
Basic | $0.28 | $0.38 |
Diluted | $0.28 | $0.38 |
Loss per share - discontinued operations: | ' | ' |
Basic | ' | ($0.17) |
Diluted | ' | ($0.16) |
Earnings per share - net income: | ' | ' |
Basic | $0.28 | $0.21 |
Diluted | $0.28 | $0.21 |
Weighted average number of shares outstanding: | ' | ' |
Basic | 32,273 | 32,337 |
Diluted | 32,616 | 32,453 |
Dividends per share: | $0.08 | ' |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Net income | $9,193 | $6,900 |
Other comprehensive loss: | ' | ' |
Foreign currency translation | ' | -174 |
Net other comprehensive loss | ' | -174 |
Comprehensive income | $9,193 | $6,726 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Operating | ' | ' |
Net income | $9,193 | $6,900 |
Adjustments to reconcile net income to net cash flows (used for) provided by operating activities: | ' | ' |
Depreciation and amortization | 3,141 | 5,444 |
Deferred income taxes | 255 | -1,039 |
Non-cash share-based compensation | 1,024 | 1,870 |
Loss on sale of Americas Data assets | 1,081 | ' |
Loss on intercompany foreign exchange transactions | ' | 250 |
Excess tax (benefit) deficiency associated with share-based payments | -112 | 488 |
Changes in assets and liabilities: | ' | ' |
Receivables | -15,900 | -2,848 |
Other current assets | -1,225 | 2,337 |
Other noncurrent assets | 48 | -195 |
Accounts payable | 634 | -1,005 |
Accrued liabilities | -608 | -164 |
Noncurrent liabilities | ' | -23 |
Net cash (used for) provided by operating activities | -2,469 | 12,015 |
Investing | ' | ' |
Purchase of equipment | -2,582 | -6,154 |
Decrease in restricted cash | ' | 837 |
Net cash used for investing activities | -2,582 | -5,317 |
Financing | ' | ' |
Proceeds from the exercise of stock options | 1,343 | ' |
Restricted shares withheld to cover employee taxes paid | -295 | -117 |
Excess tax benefit (deficiency) associated with share-based payments | 112 | -488 |
Dividends paid | -2,434 | ' |
Net cash used for financing activities | -1,274 | -605 |
Effect of exchange rate changes on cash | ' | -127 |
Net (decrease) increase in cash and cash equivalents | -6,325 | 5,966 |
Cash and cash equivalents - Beginning | 77,004 | 31,479 |
Cash and cash equivalents - End | 70,679 | 37,445 |
Supplemental disclosure of cash flow information: | ' | ' |
Cash paid for taxes | 6,579 | 979 |
Supplemental disclosure of noncash flow items: | ' | ' |
Investing activity - Accrued purchases of equipment | $1,778 | $1,848 |
DESCRIPTION_OF_THE_BUSINESS
DESCRIPTION OF THE BUSINESS | 3 Months Ended |
Mar. 31, 2014 | |
DESCRIPTION OF THE BUSINESS | ' |
1. DESCRIPTION OF THE BUSINESS | |
Organization—Inteliquent, Inc. (the Company) provides voice telecommunications services primarily on a wholesale basis. The Company offers these services using an all-IP network, which enables the Company to deliver global connectivity for a variety of media, including voice and, historically, data and video. The Company’s solutions enable carriers and other providers to deliver voice traffic or other services where they do not have their own network or elect not to use their own network. These solutions are sometimes called “off-net” services. | |
On April 30, 2013, the Company sold its global data business to Global Telecom & Technology, Inc. (GTT) for $54.5 million, subject to certain adjustments. The total consideration consisted of $52.5 million in cash, subject to net working capital adjustments, and $2.0 million of non-cash commercial IP Transit and point-to-point Ethernet data network services to be provided to the Company by GTT free-of-charge for a three-year period. The $2.0 million of non-cash commercial services was calculated based upon the discounted present value of the market cost of such services as of the date on which the commercial services agreement was signed with GTT. In addition, the Company recorded in its condensed consolidated statement of operations, as part of its gain amount on the sale of its global data business, approximately $2.4 million for divestiture-related costs, including legal and advisory services. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||
Principles of Consolidation — The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. | |||||||||
Interim Condensed Consolidated Financial Statements — The accompanying condensed consolidated balance sheets as of March 31, 2014 and December 31, 2013, the condensed consolidated statements of income for the three months ended March 31, 2014 and 2013, the condensed consolidated statements of comprehensive income for the three months ended March 31, 2014 and 2013, and the condensed consolidated statements of cash flows for the three months ended March 31, 2014 and 2013 are unaudited. The condensed consolidated balance sheet data as of December 31, 2013 was derived from the audited consolidated financial statements which are included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. The accompanying statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. | |||||||||
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) pursuant to the rules and regulations of the Securities and Exchange Commission applicable to interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. | |||||||||
In the opinion of management, the unaudited interim condensed consolidated financial statements as of March 31, 2014 and for the three months ended March 31, 2014 and 2013 have been prepared on the same basis as the audited consolidated statements and reflect all adjustments, which are normal recurring adjustments, necessary for the fair presentation of its statement of financial position, results of operations and cash flows. The results of operations for the three months ended March 31, 2014 are not necessarily indicative of the operating results for any subsequent quarter, for the full fiscal year or any future periods. | |||||||||
Changes in Presentation—On April 30, 2013, the Company sold its global data business to GTT for $54.5 million, subject to certain adjustments. The Company determined that the appropriate level in which to assess discontinued operations was at its reporting unit level. As such, the Company’s Europe, Middle East and Africa (EMEA) and Asia Pacific (APAC) reporting units of the global data business consist of results of operations and cash flows that can be clearly distinguished from the rest of the entity and are therefore reflected in the condensed consolidated statements of operations as discontinued operations. Historical information related to these reporting units have been reclassified accordingly. The Americas reporting unit of the global data business does not consist of results of operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity. This reporting unit does not qualify for discontinued operations accounting treatment. Therefore, the Americas reporting unit of the global data business is reported in continuing operations in the condensed consolidated statements of operations. Refer to Note 9 “Business Disposition” for more information regarding the sale of the global data business. | |||||||||
Cash and Cash Equivalents — The Company considers all highly liquid investments with an original maturity of 90 days or less to be cash and cash equivalents. The carrying values of our cash and cash equivalents approximate fair value. At March 31, 2014, the Company had $23.9 million of cash in banks and $46.8 million in three money market mutual funds. At December 31, 2013, the Company had $35.2 million of cash in banks and $41.8 million in three money market mutual funds. | |||||||||
Fair Value Measurements —Certain assets and liabilities are required to be recorded at fair value on a recurring basis. Fair value is determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Assets measured at fair value on a nonrecurring basis include long-lived assets held and used, long-lived assets held for sale, goodwill and other intangible assets. The fair value of cash and cash equivalents, accounts receivable and accounts payable approximate their carrying values. The three-tier value hierarchy, which prioritizes valuation methodologies based on the reliability of the inputs, is: | |||||||||
Level 1— Valuations based on quoted prices for identical assets and liabilities in active markets. | |||||||||
Level 2— Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. | |||||||||
Level 3— Valuations based on unobservable inputs reflecting the Company’s own assumptions, consistent with reasonably available assumptions made by other market participants. | |||||||||
Property and Equipment — Property and equipment is recorded at cost. These values are depreciated over the estimated useful lives of the individual assets using the straight-line method. Any gains and losses from the disposition of property and equipment are included in operations as incurred. The estimated useful life for network equipment and tools and test equipment is five years. The estimated useful life for computer equipment, computer software and furniture and fixtures is three years. Leasehold improvements are amortized on a straight-line basis over an estimated useful life of five years or the life of the lease, whichever is less. The impairment of long-lived assets is periodically evaluated when events or changes in circumstances indicate that a potential impairment has occurred. | |||||||||
Revenue Recognition —The Company generates revenue from sales of its voice services. The Company maintains tariffs and executed service agreements with each of its customers in which specific fees and rates are determined. Voice revenue is recorded each month on an accrual basis based upon minutes of traffic switched by the Company’s network by each customer, which is referred to as minutes of use. The rates charged per minute are determined by contracts between the Company and its customers, or by filed and effective tariffs. | |||||||||
Prior to the sale of the Company’s global data business in April 2013, IP Transit and Ethernet services revenues related to the Company’s Americas reporting unit for the first four months of 2013 were recorded each month on an accrual basis based upon bandwidth used by each customer. The rates charged were the total of a monthly fee for bandwidth (the Committed Traffic Rate) plus additional charges for the sustained peak bandwidth used monthly in excess of the Committed Traffic Rate. | |||||||||
Earnings (Loss) Per Share — Basic earnings (loss) per share is computed based on the weighted average number of common shares and participating securities outstanding. Diluted earnings (loss) per share is computed based on the weighted average number of common shares and participating securities outstanding adjusted by the number of additional shares that would have been outstanding during the period had the potentially dilutive securities been issued. The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings (loss) per share of common stock: | |||||||||
Three Months Ended March 31, | 2014 | 2013 | |||||||
Numerator: | |||||||||
Income from continuing operations | $ | 9,193 | $ | 12,236 | |||||
Loss from discontinued operations, net of provision for income taxes | — | (5,336 | ) | ||||||
Net income | $ | 9,193 | $ | 6,900 | |||||
Denominator: | |||||||||
Weighted average common shares outstanding | 32,273 | 32,337 | |||||||
Effect of dilutive securities: | |||||||||
Stock options | 343 | 116 | |||||||
Denominator for diluted earnings per share | 32,616 | 32,453 | |||||||
Earnings per share-continuing operations: | |||||||||
Basic | $ | 0.28 | $ | 0.38 | |||||
Diluted | $ | 0.28 | $ | 0.38 | |||||
Loss per share—discontinued operations: | |||||||||
Basic | $ | — | $ | (0.17 | ) | ||||
Diluted | $ | — | $ | (0.16 | ) | ||||
Earnings per share—net income: | |||||||||
Basic | $ | 0.28 | $ | 0.21 | |||||
Diluted | $ | 0.28 | $ | 0.21 | |||||
Outstanding share-based awards of 2.0 million and 3.6 million were outstanding during the three months ended March 31, 2014 and March 31, 2013, respectively, but were not included in the computation of diluted earnings per share because the effect would have been antidilutive. | |||||||||
For the three months ended March 31, 2014 and 2013, the undistributed earnings allocable to participating securities were $0.1 million and $0.2 million, respectively. | |||||||||
Accounting for Share-Based Payments — The fair value of stock options is determined using the Black-Scholes valuation model. This model takes into account the exercise price of the stock option, the fair value of the common stock underlying the stock option as measured on the date of grant and an estimation of the volatility of the common stock underlying the stock option. Such value is recognized as expense over the service period, net of estimated forfeitures, using the straight line method. The estimation of stock awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from the Company’s current estimates, such amounts will be recorded as a cumulative adjustment in the period estimates are revised. The Company considers many factors when estimating expected forfeitures, including types of awards, employee class and historical experience. Actual results, and future changes in estimates, may differ from the Company’s current estimates. | |||||||||
The amount of share-based expense recorded in the three months ended March 31, 2014 and 2013 was $1.0 million and $1.9 million, respectively. | |||||||||
Compensation expense for non-vested shares is measured based upon the quoted closing market price for the stock on the date of grant. The compensation cost is recognized on a straight-line basis over the vesting period. See Note 5, “Stock Options and Non-vested Shares” | |||||||||
Foreign Currency Translation — As a result of the sale of the global data business, the Company now operates substantially only within the United States and is no longer exposed to any foreign currency risk. | |||||||||
Recent Accounting Pronouncements — No new accounting pronouncement issued or effective during the three months ended March 31, 2014 had or is expected to have a material impact on the condensed consolidated financial statements. |
LEGAL_PROCEEDINGS
LEGAL PROCEEDINGS | 3 Months Ended |
Mar. 31, 2014 | |
LEGAL PROCEEDINGS | ' |
3. LEGAL PROCEEDINGS | |
From time to time, the Company is a party to legal proceedings arising in the normal course of its business. Aside from the matter discussed below, the Company does not believe that it is a party to any pending legal action that could reasonably be expected to have a material effect on its business or operating results, financial position or cash flows. | |
Municipal Audit | |
The Company is sometimes subject to examination by various local authorities. These examinations, or audits, may relate to property taxes, use taxes or other telecommunications taxes. As a result of one of these audits, the Company had received a telecommunications tax assessment for approximately $1.0 million. During the first quarter of 2014, the Company resolved this audit for less than $0.1 million, which was recorded in operations. |
INCOME_TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2014 | |
INCOME TAXES | ' |
4. INCOME TAXES | |
Income taxes were computed using an effective tax rate, which is subject to ongoing review and evaluation by the Company. The Company’s estimated effective income tax rate was 40.0% for the three months ended March 31, 2014, compared to 22.8% for the same period last year. | |
The difference in the effective tax rate for the three months ended March 31, 2014 as compared to the three months ended March 31, 2013 is due primarily to the Illinois EDGE Credit benefit in the prior year, the settlement of the net working capital adjustment related to the 2013 sale of the data business in the current year and the impact of the sale of the data business that was included in the prior year results. | |
The Company has recorded a valuation allowance against the capital loss created by the sale of its global data business and the Illinois EDGE Credit. The Company believes it is more likely than not that these assets will not be fully realized in the foreseeable future. The realization of deferred tax assets is dependent upon whether the Company can generate future taxable income in the appropriate jurisdiction to utilize the assets. The amount of the deferred tax assets considered realizable is subject to adjustment in future periods. |
STOCK_OPTIONS_AND_NONVESTED_SH
STOCK OPTIONS AND NON-VESTED SHARES | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
STOCK OPTIONS AND NON-VESTED SHARES | ' | ||||||||||||||||
5. STOCK OPTIONS AND NON-VESTED SHARES | |||||||||||||||||
In 2003, the Company established the 2003 Stock Option and Stock Incentive Plan (2003 Plan), which provided for the issuance of up to 4.7 million options and non-vested shares to eligible employees, officers, and independent contractors of the Company. In 2007, the Company adopted the Neutral Tandem, Inc. 2007 Equity Incentive Plan (2007 Plan) and ceased awarding equity grants under the 2003 Plan. As of March 31, 2014, the Company had granted a total of 2.9 million options and 0.5 million non-vested shares that remained outstanding under the 2007 Plan. Awards for 1.6 million shares, representing approximately 4.8% of the Company’s outstanding common stock as of March 31, 2014, remained available for additional grants under the 2007 Plan. | |||||||||||||||||
The Company records share-based compensation expense in connection with any grant of options and non-vested shares to its employees. The Company calculates the expense associated with its stock options and non-vested shares by determining the fair value of the options and non-vested shares. | |||||||||||||||||
Options | |||||||||||||||||
All options granted under the 2003 Plan and the 2007 Plan have an exercise price equal to the market value of the underlying common stock on the date of the grant. During the three months ended March 31, 2014, the Company granted less than 0.1 million options at a weighted-average exercise price of $13.86. During the three months ended March 31, 2013, the Company granted 0.7 million options at a weighted-average exercise price of $3.40. | |||||||||||||||||
The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model. The following table summarizes the assumptions used for estimating the fair value of options for the three months ended March 31, 2014 and March 31, 2013: | |||||||||||||||||
March 31, | March 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Expected life | 7.2 years | 7.3 years | |||||||||||||||
Risk-free interest rate range | 2.08% | 1.32% | |||||||||||||||
Expected dividends | 2.10% | — | |||||||||||||||
Volatility | 60.00% | 45.00% | |||||||||||||||
The weighted-average fair value of options granted, as determined by using the Black-Scholes valuation model, during the three months ended March 31, 2014 and 2013 was $6.90 and $1.64, respectively. The total grant date fair value of options that vested during the three months ended March 31, 2014 and 2013 was approximately $0.5 million and $0.4 million, respectively. The total intrinsic value (market value of stock less option exercise price) of stock options exercised was $0.2 million during the three months ended March 31, 2014. There were no stock options exercised during the three months ended March 31, 2013. | |||||||||||||||||
The following summarizes activity under the Company’s stock option plan for the three months ended March 31, 2014: | |||||||||||||||||
Shares | Weighted- | Aggregate | Weighted- | ||||||||||||||
0 | Average | Intrinsic | Average | ||||||||||||||
Exercise | Value | Remaining | |||||||||||||||
Price | $0 | Term (yrs) | |||||||||||||||
Options outstanding — January 1, 2014 | 2,991 | $ | 12.91 | ||||||||||||||
Granted | 40 | 13.86 | |||||||||||||||
Exercised | 111 | 12.53 | |||||||||||||||
Cancelled | — | — | |||||||||||||||
Options outstanding — March 31, 2014 | 2,920 | $ | 12.94 | $ | 9,902 | 5.78 | |||||||||||
Vested or expected to vest — March 31, 2014 | 2,903 | $ | 12.99 | $ | 9,727 | 5.76 | |||||||||||
Exercisable — March 31, 2014 | 2,347 | $ | 14.92 | $ | 4,348 | 5.07 | |||||||||||
The unrecognized compensation cost associated with options outstanding at March 31, 2014 and December 31, 2013 was $1.7 million and $1.7 million, respectively. The weighted average remaining term that the compensation will be recorded is 2.3 years and 2.1 years as of March 31, 2014 and December 31, 2013, respectively. | |||||||||||||||||
Non-vested Shares | |||||||||||||||||
During the three months ended March 31, 2014 and March 31, 2013, the Company granted 0.1 million and 0.1 million non-vested shares, respectively, to members of the Company’s executive management team as well as various employees within the Company. The non-vested shares were issued as part of the 2007 Plan. The shares typically vest over a four-year period. The fair value of the non-vested shares is determined using the Company’s closing stock price on the grant date. Compensation cost, measured using the grant date fair value, is recognized over the requisite service period on a straight-line basis. | |||||||||||||||||
A summary of the Company’s non-vested share activity and related information for the three months ended March 31, 2014 is as follows: | |||||||||||||||||
Shares | Weighted- | Aggregate | |||||||||||||||
0 | Average | Intrinsic | |||||||||||||||
Grant Date | Value | ||||||||||||||||
Fair Value | $0 | ||||||||||||||||
Non-vested shares outstanding — January 1, 2014 | 477 | $ | 9.66 | ||||||||||||||
Granted | 80 | 11.4 | |||||||||||||||
Vested | (72 | ) | 11.65 | ||||||||||||||
Cancelled | — | — | |||||||||||||||
Non-vested shares outstanding — March 31, 2014 | 485 | $ | 9.65 | $ | 7,047 | ||||||||||||
Non-vested shares vested or expected to vest — March 31, 2014 | 453 | $ | 9.65 | $ | 6,582 | ||||||||||||
The aggregate intrinsic value represents the total pre-tax intrinsic value based on the Company’s closing stock price of $14.53 on March 31, 2014. The amount changes based upon the fair market value of the Company’s common stock. | |||||||||||||||||
The unrecognized compensation cost associated with non-vested shares at March 31, 2014 and December 31, 2013 was $3.9 million and $3.9 million, respectively. The weighted average remaining term that the compensation will be recorded is 2.1 years and 1.7 years as of March 31, 2014 and December 31, 2013, respectively. |
FAIR_VALUE_MEASUREMENT
FAIR VALUE MEASUREMENT | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
FAIR VALUE MEASUREMENT | ' | ||||||||||||||||
6. FAIR VALUE MEASUREMENT | |||||||||||||||||
The Company’s money market funds are recognized and disclosed at fair value in the financial statements on a recurring basis. Fair value is defined as the price that would be received to sell an asset in an orderly transaction between market participants as of the measurement date. Fair value is measured using the fair value hierarchy and related valuation methodologies as defined in the authoritative literature. This guidance specifies a hierarchy of valuation techniques based on whether the inputs to each measurement are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s assumptions about current market conditions. The prescribed fair value hierarchy and related valuation methodologies are as follows: | |||||||||||||||||
Level 1 - Quoted prices for identical instruments in active markets. | |||||||||||||||||
Level 2 - Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations, in which all significant inputs are observable in active markets. | |||||||||||||||||
Level 3 - Valuations derived from valuation techniques, in which one or more significant inputs are unobservable. | |||||||||||||||||
The fair value of the Company’s financial asset by level in the fair value hierarchy as of March 31, 2014 and December 31, 2013 was as follows: | |||||||||||||||||
31-Mar-14 | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Money Market Funds | $ | 46,828 | $ | — | $ | — | $ | 46,828 | |||||||||
31-Dec-13 | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Money Market Funds | $ | 41,827 | $ | — | $ | — | $ | 41,827 | |||||||||
Valuation methodology | |||||||||||||||||
Level 1—Quoted market prices in active markets are available for investments in money market funds. As such, these investments are classified within Level 1. |
CREDIT_FACILITY
CREDIT FACILITY | 3 Months Ended |
Mar. 31, 2014 | |
CREDIT FACILITY | ' |
7. CREDIT FACILITY | |
On March 5, 2013, the Company entered into a $15.0 million revolving credit facility. The credit facility has a term of three years and an interest rate of LIBOR + 3.25%. The Company may use any borrowings under the revolving credit facility for general corporate purposes. No obligations were outstanding under the revolving credit facility at any time during the year ended December 31, 2013 and for the three months ended March 31, 2014. As of March 31, 2014, the Company is currently in compliance with all of the covenants of the credit facility agreement. |
ACCUMULATED_OTHER_COMPREHENSIV
ACCUMULATED OTHER COMPREHENSIVE LOSS | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
ACCUMULATED OTHER COMPREHENSIVE LOSS | ' | ||||
8. ACCUMULATED OTHER COMPREHENSIVE LOSS | |||||
There was no balance of accumulated other comprehensive loss for the three months ended March 31, 2014. Changes in the balance of accumulated other comprehensive loss for the three months ended March 31, 2013 are summarized in the following table: | |||||
Three Months Ended March 31, | 2013 | ||||
Balance as of January 1 | $ | (4,904 | ) | ||
Other comprehensive loss before reclassifications, net of tax | (174 | ) | |||
Less: Amounts reclassified from AOCI, net of tax | — | ||||
Net other comprehensive loss | (174 | ) | |||
Balance as of March 31 | $ | (5,078 | ) | ||
BUSINESS_DISPOSITION
BUSINESS DISPOSITION | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
BUSINESS DISPOSITION | ' | ||||
9. BUSINESS DISPOSITION | |||||
On April 30, 2013, the Company sold its global data business to GTT and, as a result, no longer provides data services. The transaction consisted of the Americas, EMEA and APAC reporting units’ data assets and liabilities. The Americas reporting unit of the global data business did not qualify for discontinued operations because it did not constitute a separate component of the Company. The data activity associated with the Americas reporting unit is reported in continuing operations in the consolidated statements of operations and consolidated balance sheets. The data activity associated with the EMEA and APAC reporting units is reflected in the consolidated statements of operations and in the consolidated balance sheets as discontinued operations. Historical information related to these reporting units has been reclassified accordingly. | |||||
The Company sold its global data business for $54.5 million which consisted of $52.5 million in cash, subject to net working capital adjustments, and $2.0 million of non-cash commercial services to be provided by GTT to the Company over a three-year period. After an initial net working capital reduction of $3.3 million based on the balance sheet information as of March 31, 2013, the Company received $51.2 million of cash and non-cash services from GTT. Transaction costs and the additional net working capital adjustment, resulting from balance sheet changes during the month of April following the initial calculation, amounted to approximately $2.4 million and $1.0 million, respectively, reducing net cash and non-cash consideration to approximately $47.8 million. Of this amount, $43.5 million was allocated to the sale of the Americas reporting unit of the global data business and the remaining amount of $4.3 million was allocated to the EMEA and APAC reporting units of the global data business. The Company based its allocation of the $47.8 million amount based upon the relative percentage of the fair value of the Americas reporting unit and the EMEA and APAC reporting units, to the total fair value of these three reporting units combined. | |||||
The Company and GTT disagreed over the amount of certain post-closing purchase price adjustment provisions in the agreement governing the sale of the Company’s global data business to GTT. GTT claimed that the Company owed GTT $3.8 million. The Company, however, believed that GTT owed the Company $1.1 million. During the first quarter of 2014, the parties tentatively agreed to resolve their differences with respect to the post-closing adjustments to the purchase price in a manner that would require neither party to make a payment to the other and would waive all other claims. As a result of the tentative agreement, the Company reduced other assets by $1.1 million and charged $1.1 million to continuing operations within Loss on Sale of Americas Data Assets. If the parties are unable to consummate this tentative agreement or otherwise resolve their differences through negotiations, a neutral third party accounting firm will hear and decide the matter. | |||||
Disposition Not Qualifying for Discontinued Operations | |||||
The Americas reporting unit assets, which were sold as part of the sales of the global data business, had an approximate net book value of $14.7 million at the time of the sale. The purchase price allocation of $43.5 million for this portion of the global data business, less its net book basis of assets and liabilities yielded a gain from sale of $28.8 million. | |||||
Discontinued Operations | |||||
The net book basis of the assets and liabilities for the EMEA and APAC reporting units of the global data business at the date of sale was approximately $10.1 million. In addition, the Company is entitled to approximately $1.0 million of cash that remained with the EMEA and APAC reporting units of the global data business at the time of the transaction. The purchase price allocation of $4.3 million for this portion of the global data business plus the additional $1.0 million of cash yielded a loss on the sale from discontinued operations of $4.8 million. | |||||
The following table displays summarized activity in the Company’s consolidated statements of operations for discontinued operations during the three months ended March 31, 2013. | |||||
Three Months Ended March 31, | 2013 | ||||
Revenue | $ | 10,378 | |||
Operating loss | (4,603 | ) | |||
Loss before provision for income taxes | (5,109 | ) | |||
Provision for income taxes | 227 | ||||
Loss from discontinued operations | $ | (5,336 | ) |
SEGMENT_AND_GEOGRAPHIC_INFORMA
SEGMENT AND GEOGRAPHIC INFORMATION | 3 Months Ended |
Mar. 31, 2014 | |
SEGMENT AND GEOGRAPHIC INFORMATION | ' |
10. SEGMENT AND GEOGRAPHIC INFORMATION | |
Segment Reporting establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision making group, in deciding how to allocate resources and in assessing performance. | |
The Company’s chief operating decision maker is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis. The Company operates in one industry segment which is to provide voice interconnection services via the Company’s international telecommunications network to fulfill customer agreements. Therefore, the Company has concluded that it has one operating segment. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Principles of Consolidation | ' | ||||||||
Principles of Consolidation — The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. | |||||||||
Interim Condensed Consolidated Financial Statements — The accompanying condensed consolidated balance sheets as of March 31, 2014 and December 31, 2013, the condensed consolidated statements of income for the three months ended March 31, 2014 and 2013, the condensed consolidated statements of comprehensive income for the three months ended March 31, 2014 and 2013, and the condensed consolidated statements of cash flows for the three months ended March 31, 2014 and 2013 are unaudited. The condensed consolidated balance sheet data as of December 31, 2013 was derived from the audited consolidated financial statements which are included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. The accompanying statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. | |||||||||
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) pursuant to the rules and regulations of the Securities and Exchange Commission applicable to interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. | |||||||||
In the opinion of management, the unaudited interim condensed consolidated financial statements as of March 31, 2014 and for the three months ended March 31, 2014 and 2013 have been prepared on the same basis as the audited consolidated statements and reflect all adjustments, which are normal recurring adjustments, necessary for the fair presentation of its statement of financial position, results of operations and cash flows. The results of operations for the three months ended March 31, 2014 are not necessarily indicative of the operating results for any subsequent quarter, for the full fiscal year or any future periods. | |||||||||
Changes in Presentation | ' | ||||||||
Changes in Presentation—On April 30, 2013, the Company sold its global data business to GTT for $54.5 million, subject to certain adjustments. The Company determined that the appropriate level in which to assess discontinued operations was at its reporting unit level. As such, the Company’s Europe, Middle East and Africa (EMEA) and Asia Pacific (APAC) reporting units of the global data business consist of results of operations and cash flows that can be clearly distinguished from the rest of the entity and are therefore reflected in the condensed consolidated statements of operations as discontinued operations. Historical information related to these reporting units have been reclassified accordingly. The Americas reporting unit of the global data business does not consist of results of operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity. This reporting unit does not qualify for discontinued operations accounting treatment. Therefore, the Americas reporting unit of the global data business is reported in continuing operations in the condensed consolidated statements of operations. Refer to Note 9 “Business Disposition” for more information regarding the sale of the global data business. | |||||||||
Cash and Cash Equivalents | ' | ||||||||
Cash and Cash Equivalents — The Company considers all highly liquid investments with an original maturity of 90 days or less to be cash and cash equivalents. The carrying values of our cash and cash equivalents approximate fair value. At March 31, 2014, the Company had $23.9 million of cash in banks and $46.8 million in three money market mutual funds. At December 31, 2013, the Company had $35.2 million of cash in banks and $41.8 million in three money market mutual funds. | |||||||||
Fair Value Measurements | ' | ||||||||
Fair Value Measurements —Certain assets and liabilities are required to be recorded at fair value on a recurring basis. Fair value is determined based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Assets measured at fair value on a nonrecurring basis include long-lived assets held and used, long-lived assets held for sale, goodwill and other intangible assets. The fair value of cash and cash equivalents, accounts receivable and accounts payable approximate their carrying values. The three-tier value hierarchy, which prioritizes valuation methodologies based on the reliability of the inputs, is: | |||||||||
Level 1— Valuations based on quoted prices for identical assets and liabilities in active markets. | |||||||||
Level 2— Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. | |||||||||
Level 3— Valuations based on unobservable inputs reflecting the Company’s own assumptions, consistent with reasonably available assumptions made by other market participants. | |||||||||
Property and Equipment | ' | ||||||||
Property and Equipment — Property and equipment is recorded at cost. These values are depreciated over the estimated useful lives of the individual assets using the straight-line method. Any gains and losses from the disposition of property and equipment are included in operations as incurred. The estimated useful life for network equipment and tools and test equipment is five years. The estimated useful life for computer equipment, computer software and furniture and fixtures is three years. Leasehold improvements are amortized on a straight-line basis over an estimated useful life of five years or the life of the lease, whichever is less. The impairment of long-lived assets is periodically evaluated when events or changes in circumstances indicate that a potential impairment has occurred. | |||||||||
Revenue Recognition | ' | ||||||||
Revenue Recognition —The Company generates revenue from sales of its voice services. The Company maintains tariffs and executed service agreements with each of its customers in which specific fees and rates are determined. Voice revenue is recorded each month on an accrual basis based upon minutes of traffic switched by the Company’s network by each customer, which is referred to as minutes of use. The rates charged per minute are determined by contracts between the Company and its customers, or by filed and effective tariffs. | |||||||||
Prior to the sale of the Company’s global data business in April 2013, IP Transit and Ethernet services revenues related to the Company’s Americas reporting unit for the first four months of 2013 were recorded each month on an accrual basis based upon bandwidth used by each customer. The rates charged were the total of a monthly fee for bandwidth (the Committed Traffic Rate) plus additional charges for the sustained peak bandwidth used monthly in excess of the Committed Traffic Rate. | |||||||||
Earnings (Loss) Per Share | ' | ||||||||
Earnings (Loss) Per Share — Basic earnings (loss) per share is computed based on the weighted average number of common shares and participating securities outstanding. Diluted earnings (loss) per share is computed based on the weighted average number of common shares and participating securities outstanding adjusted by the number of additional shares that would have been outstanding during the period had the potentially dilutive securities been issued. The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings (loss) per share of common stock: | |||||||||
Three Months Ended March 31, | 2014 | 2013 | |||||||
Numerator: | |||||||||
Income from continuing operations | $ | 9,193 | $ | 12,236 | |||||
Loss from discontinued operations, net of provision for income taxes | — | (5,336 | ) | ||||||
Net income | $ | 9,193 | $ | 6,900 | |||||
Denominator: | |||||||||
Weighted average common shares outstanding | 32,273 | 32,337 | |||||||
Effect of dilutive securities: | |||||||||
Stock options | 343 | 116 | |||||||
Denominator for diluted earnings per share | 32,616 | 32,453 | |||||||
Earnings per share-continuing operations: | |||||||||
Basic | $ | 0.28 | $ | 0.38 | |||||
Diluted | $ | 0.28 | $ | 0.38 | |||||
Loss per share—discontinued operations: | |||||||||
Basic | $ | — | $ | (0.17 | ) | ||||
Diluted | $ | — | $ | (0.16 | ) | ||||
Earnings per share—net income: | |||||||||
Basic | $ | 0.28 | $ | 0.21 | |||||
Diluted | $ | 0.28 | $ | 0.21 | |||||
Outstanding share-based awards of 2.0 million and 3.6 million were outstanding during the three months ended March 31, 2014 and March 31, 2013, respectively, but were not included in the computation of diluted earnings per share because the effect would have been antidilutive. | |||||||||
For the three months ended March 31, 2014 and 2013, the undistributed earnings allocable to participating securities were $0.1 million and $0.2 million, respectively. | |||||||||
Accounting for Share-Based Payments | ' | ||||||||
Accounting for Share-Based Payments — The fair value of stock options is determined using the Black-Scholes valuation model. This model takes into account the exercise price of the stock option, the fair value of the common stock underlying the stock option as measured on the date of grant and an estimation of the volatility of the common stock underlying the stock option. Such value is recognized as expense over the service period, net of estimated forfeitures, using the straight line method. The estimation of stock awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from the Company’s current estimates, such amounts will be recorded as a cumulative adjustment in the period estimates are revised. The Company considers many factors when estimating expected forfeitures, including types of awards, employee class and historical experience. Actual results, and future changes in estimates, may differ from the Company’s current estimates. | |||||||||
The amount of share-based expense recorded in the three months ended March 31, 2014 and 2013 was $1.0 million and $1.9 million, respectively. | |||||||||
Compensation expense for non-vested shares is measured based upon the quoted closing market price for the stock on the date of grant. The compensation cost is recognized on a straight-line basis over the vesting period. See Note 5, “Stock Options and Non-vested Shares” | |||||||||
Foreign Currency Translation | ' | ||||||||
Foreign Currency Translation — As a result of the sale of the global data business, the Company now operates substantially only within the United States and is no longer exposed to any foreign currency risk. | |||||||||
Recent Accounting Pronouncements | ' | ||||||||
Recent Accounting Pronouncements — No new accounting pronouncement issued or effective during the three months ended March 31, 2014 had or is expected to have a material impact on the condensed consolidated financial statements. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Earnings (Loss) Per Share | ' | ||||||||
The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings (loss) per share of common stock: | |||||||||
Three Months Ended March 31, | 2014 | 2013 | |||||||
Numerator: | |||||||||
Income from continuing operations | $ | 9,193 | $ | 12,236 | |||||
Loss from discontinued operations, net of provision for income taxes | — | (5,336 | ) | ||||||
Net income | $ | 9,193 | $ | 6,900 | |||||
Denominator: | |||||||||
Weighted average common shares outstanding | 32,273 | 32,337 | |||||||
Effect of dilutive securities: | |||||||||
Stock options | 343 | 116 | |||||||
Denominator for diluted earnings per share | 32,616 | 32,453 | |||||||
Earnings per share-continuing operations: | |||||||||
Basic | $ | 0.28 | $ | 0.38 | |||||
Diluted | $ | 0.28 | $ | 0.38 | |||||
Loss per share—discontinued operations: | |||||||||
Basic | $ | — | $ | (0.17 | ) | ||||
Diluted | $ | — | $ | (0.16 | ) | ||||
Earnings per share—net income: | |||||||||
Basic | $ | 0.28 | $ | 0.21 | |||||
Diluted | $ | 0.28 | $ | 0.21 |
STOCK_OPTIONS_AND_NONVESTED_SH1
STOCK OPTIONS AND NON-VESTED SHARES (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Assumptions Used to Estimate Fair Value of Stock Options | ' | ||||||||||||||||
The following table summarizes the assumptions used for estimating the fair value of options for the three months ended March 31, 2014 and March 31, 2013: | |||||||||||||||||
March 31, | March 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Expected life | 7.2 years | 7.3 years | |||||||||||||||
Risk-free interest rate range | 2.08% | 1.32% | |||||||||||||||
Expected dividends | 2.10% | — | |||||||||||||||
Volatility | 60.00% | 45.00% | |||||||||||||||
Stock Option Plan Activity | ' | ||||||||||||||||
The following summarizes activity under the Company’s stock option plan for the three months ended March 31, 2014: | |||||||||||||||||
Shares | Weighted- | Aggregate | Weighted- | ||||||||||||||
0 | Average | Intrinsic | Average | ||||||||||||||
Exercise | Value | Remaining | |||||||||||||||
Price | $0 | Term (yrs) | |||||||||||||||
Options outstanding — January 1, 2014 | 2,991 | $ | 12.91 | ||||||||||||||
Granted | 40 | 13.86 | |||||||||||||||
Exercised | 111 | 12.53 | |||||||||||||||
Cancelled | — | — | |||||||||||||||
Options outstanding — March 31, 2014 | 2,920 | $ | 12.94 | $ | 9,902 | 5.78 | |||||||||||
Vested or expected to vest — March 31, 2014 | 2,903 | $ | 12.99 | $ | 9,727 | 5.76 | |||||||||||
Exercisable — March 31, 2014 | 2,347 | $ | 14.92 | $ | 4,348 | 5.07 | |||||||||||
Non-Vested Share Activity | ' | ||||||||||||||||
A summary of the Company’s non-vested share activity and related information for the three months ended March 31, 2014 is as follows: | |||||||||||||||||
Shares | Weighted- | Aggregate | |||||||||||||||
0 | Average | Intrinsic | |||||||||||||||
Grant Date | Value | ||||||||||||||||
Fair Value | $0 | ||||||||||||||||
Non-vested shares outstanding — January 1, 2014 | 477 | $ | 9.66 | ||||||||||||||
Granted | 80 | 11.4 | |||||||||||||||
Vested | (72 | ) | 11.65 | ||||||||||||||
Cancelled | — | — | |||||||||||||||
Non-vested shares outstanding — March 31, 2014 | 485 | $ | 9.65 | $ | 7,047 | ||||||||||||
Non-vested shares vested or expected to vest — March 31, 2014 | 453 | $ | 9.65 | $ | 6,582 |
FAIR_VALUE_MEASUREMENT_Tables
FAIR VALUE MEASUREMENT (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Fair Value of Company's Financial Assets by Level in Fair Value Hierarchy | ' | ||||||||||||||||
The fair value of the Company’s financial asset by level in the fair value hierarchy as of March 31, 2014 and December 31, 2013 was as follows: | |||||||||||||||||
31-Mar-14 | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Money Market Funds | $ | 46,828 | $ | — | $ | — | $ | 46,828 | |||||||||
31-Dec-13 | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Assets: | |||||||||||||||||
Money Market Funds | $ | 41,827 | $ | — | $ | — | $ | 41,827 |
ACCUMULATED_OTHER_COMPREHENSIV1
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Changes in Accumulated Other Comprehensive Loss | ' | ||||
Changes in the balance of accumulated other comprehensive loss for the three months ended March 31, 2013 are summarized in the following table: | |||||
Three Months Ended March 31, | 2013 | ||||
Balance as of January 1 | $ | (4,904 | ) | ||
Other comprehensive loss before reclassifications, net of tax | (174 | ) | |||
Less: Amounts reclassified from AOCI, net of tax | — | ||||
Net other comprehensive loss | (174 | ) | |||
Balance as of March 31 | $ | (5,078 | ) | ||
BUSINESS_DISPOSITION_Tables
BUSINESS DISPOSITION (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Summarized Activity in Company's Consolidated Statements of Income and Summary of Assets and Liabilities for Discontinued Operations | ' | ||||
The following table displays summarized activity in the Company’s consolidated statements of operations for discontinued operations during the three months ended March 31, 2013. | |||||
Three Months Ended March 31, | 2013 | ||||
Revenue | $ | 10,378 | |||
Operating loss | (4,603 | ) | |||
Loss before provision for income taxes | (5,109 | ) | |||
Provision for income taxes | 227 | ||||
Loss from discontinued operations | $ | (5,336 | ) |
Description_of_the_Business_Ad
Description of the Business - Additional Information (Detail) (USD $) | 0 Months Ended |
In Millions, unless otherwise specified | Apr. 30, 2013 |
Business Acquisition [Line Items] | ' |
Proceeds from sale of business | $54.50 |
Proceed from sale of business, cash | 52.5 |
Sale of business non-cash consideration | 2 |
Period of free service provided | '3 years |
Divestiture related costs included in gain on sale of business | $2.40 |
Recovered_Sheet1
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | ||
In Millions, unless otherwise specified | Apr. 30, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Investment | Investment | |||
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Proceeds from sale of business | $54.50 | ' | ' | ' |
Cash in banks | ' | 23.9 | ' | 35.2 |
Money market mutual funds | ' | 46.8 | ' | 41.8 |
Number of money market mutual fund invested | ' | 3 | ' | 3 |
Undistributed earnings allocable to participating securities | ' | 0.1 | 0.2 | ' |
Share-based expense | ' | $1 | $1.90 | ' |
Share-based awards | ' | ' | ' | ' |
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities not included in the computation of diluted earnings per share | ' | 2 | 3.6 | ' |
Network Equipment And Tools And Test Equipment | ' | ' | ' | ' |
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Estimated useful lives, years | ' | '5 years | ' | ' |
Furniture and fixtures | ' | ' | ' | ' |
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Estimated useful lives, years | ' | '3 years | ' | ' |
Leasehold Improvements | ' | ' | ' | ' |
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Estimated useful lives, years | ' | 'Five years or the life of the lease, whichever is less | ' | ' |
Earnings_Per_Share_Detail
Earnings Per Share (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Income from continuing operations | $9,193 | $12,236 |
Loss from discontinued operations, net of provision for income taxes | ' | -5,336 |
Net income | $9,193 | $6,900 |
Weighted average common shares outstanding | 32,273 | 32,337 |
Stock options | 343 | 116 |
Denominator for diluted earnings per share | 32,616 | 32,453 |
Earnings per share-continuing operations: | ' | ' |
Basic | $0.28 | $0.38 |
Diluted | $0.28 | $0.38 |
Loss per share-discontinued operations: | ' | ' |
Basic | ' | ($0.17) |
Diluted | ' | ($0.16) |
Earnings per share-net income: | ' | ' |
Basic | $0.28 | $0.21 |
Diluted | $0.28 | $0.21 |
Legal_Proceedings_Additional_I
Legal Proceedings - Additional Information (Detail) (State and Local Jurisdiction, USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Loss Contingencies [Line Items] | ' |
Income tax examination, tax assessment | $1 |
Maximum | ' |
Loss Contingencies [Line Items] | ' |
Tax interest and penalties | $0.10 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Income Tax [Line Items] | ' | ' |
Estimated effective income tax rate | 40.00% | 22.80% |
Recovered_Sheet2
Stock Options and Non-Vested Shares - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |
In Millions, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Granted options outstanding | 2,920,000 | ' | 2,991,000 |
Non-vested granted shares remaining outstanding | 485,000 | ' | 477,000 |
Options granted | ' | 700,000 | ' |
Weighted-average exercise price | $13.86 | 3.4 | ' |
Weighted-average fair value of options granted | $6.90 | 1.64 | ' |
Total grant date fair value of options granted | $0.50 | 0.4 | ' |
Total intrinsic value of stock options exercised | 0.2 | ' | ' |
Stock options exercised | 111,000 | 0 | ' |
Shares granted, non vested | 80,000 | ' | ' |
Closing stock price | $14.53 | ' | ' |
Maximum | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Options granted | 100,000 | ' | ' |
2003 Plan | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Issuance of stock options and non-vested shares | 4,700,000 | ' | ' |
2007 Plan | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Granted options outstanding | 2,900,000 | ' | ' |
Non-vested granted shares remaining outstanding | 500,000 | ' | ' |
Additional outstanding shares available for grant | 1,600,000 | ' | ' |
Shares available for grant as a percentage of the Company's outstanding common stock | 4.80% | ' | ' |
Non-Vested Shares | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Weighted average remaining term recorded for options, in years | '2 years 1 month 6 days | ' | '1 year 8 months 12 days |
Shares granted, non vested | 100,000 | 100,000 | ' |
Non-vested shares, vesting period, years | '4 years | '4 years | ' |
Unrecognized compensation cost | 3.9 | ' | 3.9 |
Stock Options | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Unrecognized compensation cost | $1.70 | ' | $1.70 |
Weighted average remaining term recorded for options, in years | '2 years 3 months 18 days | ' | '2 years 1 month 6 days |
Estimated_Fair_Value_of_Option
Estimated Fair Value of Options (Detail) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Expected life | '7 years 2 months 12 days | '7 years 3 months 18 days |
Risk-free interest rate range | 2.08% | 1.32% |
Expected dividends | 2.10% | ' |
Volatility | 60.00% | 45.00% |
Stock_Option_Plan_Activity_Det
Stock Option Plan Activity (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Shares, Options outstanding beginning | 2,991,000 | ' |
Shares, Granted | 40,000 | ' |
Shares, Exercised | 111,000 | 0 |
Shares, Cancelled | ' | ' |
Shares, Options outstanding ending | 2,920,000 | ' |
Shares, Vested or expected to Vest | 2,903,000 | ' |
Shares, Exercisable | 2,347,000 | ' |
Weighted Average Exercise Price, Options outstanding beginning | $12.91 | ' |
Weighted Average Exercise Price, Granted | $13.86 | $3.40 |
Weighted Average Exercise Price, Exercised | $12.53 | ' |
Weighted Average Exercise Price, Canceled | ' | ' |
Weighted Average Exercise Price, Options outstanding ending | $12.94 | ' |
Weighted Average Exercise Price, Vested or expected to vest | $12.99 | ' |
Weighted Average Exercise Price, Exercisable | $14.92 | ' |
Aggregate Intrinsic Value, Options outstanding ending | $9,902 | ' |
Aggregate Intrinsic Value, Vested or expected to vest | 9,727 | ' |
Aggregate Intrinsic Value, Exercisable | $4,348 | ' |
Weighted Average Remaining Term, Options outstanding ending, years | '5 years 9 months 11 days | ' |
Weighted Average Remaining Term, vested or expected to vest, years | '5 years 9 months 4 days | ' |
Weighted Average Remaining Term, Exercisable, years | '5 years 26 days | ' |
NonVested_Share_Activity_Detai
Non-Vested Share Activity (Detail) (USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Shares, Non-vested shares outstanding beginning | 477 |
Shares, Granted | 80 |
Shares, Vested | -72 |
Shares, Cancelled | ' |
Shares, Non-vested shares outstanding ending | 485 |
Shares, Non-vested shares vested or expected to vest | 453 |
Weighted Average Grant Date Fair Value, Non-vested shares outstanding beginning | $9.66 |
Weighted Average Grant Date Fair Value, Granted | $11.40 |
Weighted Average Grant Date Fair Value, Vested | $11.65 |
Weighted Average Grant Date Fair Value, Cancelled | ' |
Weighted Average Grant Date Fair Value, Non-vested shares outstanding ending | $9.65 |
Weighted Average Grant Date Fair Value, Non-vested shares vested or expected to vest | $9.65 |
Aggregate Intrinsic Value, Non-vested shares outstanding ending | $7,047 |
Aggregate Intrinsic Value, Non-vested shares vested or expected to vest | $6,582 |
Fair_Value_of_Companys_Financi
Fair Value of Company's Financial Assets by Level in Fair Value Hierarchy (Detail) (Fair Value, Measurements, Recurring, Money Market Funds, USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Assets: | ' | ' |
Assets, fair Value | $46,828 | $41,827 |
Level 1 | ' | ' |
Assets: | ' | ' |
Assets, fair Value | $46,828 | $41,827 |
Credit_Facility_Additional_Inf
Credit Facility - Additional Information (Detail) (Revolving Credit Facility, USD $) | 0 Months Ended | ||
In Millions, unless otherwise specified | Mar. 05, 2013 | Mar. 31, 2014 | Dec. 31, 2013 |
Line of Credit Facility [Line Items] | ' | ' | ' |
Credit facility, maximum borrowing capacity | $15 | ' | ' |
Credit facility, maturity term | '3 years | ' | ' |
Revolving credit facility outstanding | ' | $0 | $0 |
LIBOR | ' | ' | ' |
Line of Credit Facility [Line Items] | ' | ' | ' |
Credit facility, interest rate | 3.25% | ' | ' |
Recovered_Sheet3
Accumulated Other Comprehensive Loss - Additional Information (Detail) (USD $) | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' | ' |
Accumulated other comprehensive income (loss) | $0 | ($5,078) | ($4,904) |
Changes_in_Accumulated_Other_C
Changes in Accumulated Other Comprehensive Loss (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2013 | Mar. 31, 2014 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' |
Beginning balance | ($4,904) | $0 |
Other comprehensive loss before reclassifications, net of tax | -174 | ' |
Less: Amounts reclassified from AOCI, net of tax | ' | ' |
Net other comprehensive loss | -174 | ' |
Ending balance | ($5,078) | $0 |
Business_Disposition_Additiona
Business Disposition - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | |
Apr. 30, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' |
Proceeds from sale of business | $54,500,000 | ' | ' |
Proceed from sale of business, cash | 52,500,000 | ' | ' |
Sale of business non-cash consideration | 2,000,000 | ' | ' |
Period of free service provided | '3 years | ' | ' |
Proceeds from business after working capital adjustment | 3,300,000 | ' | ' |
Proceeds from sale of discontinued operations | 51,200,000 | ' | ' |
Transaction costs from sale of business | 2,400,000 | ' | ' |
Working capital adjustment | 1,000,000 | ' | ' |
Proceeds from sale of business net of working capital adjustment and transaction cost | 47,800,000 | ' | ' |
Claims pursuant to post closing purchase price adjustment by GTT | 3,800,000 | ' | ' |
Due from GTT related to post closing purchase price adjustment | 1,100,000 | ' | ' |
Reduction in other assets | ' | 1,225,000 | -2,337,000 |
Gain (Loss) on sale of asset held for sale | 28,800,000 | -1,081,000 | ' |
Book value of asset held for sale | 14,700,000 | ' | ' |
Disposal group including discontinued operation cash and cash equivalents | 1,000,000 | ' | ' |
Loss on sale of the global data business | -4,800,000 | ' | ' |
Americas | ' | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' |
Proceeds from sale of asset held for sale | 43,500,000 | ' | ' |
Reduction in other assets | ' | -1,100,000 | ' |
Gain (Loss) on sale of asset held for sale | ' | -1,100,000 | ' |
EMEA and APAC | ' | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' |
Proceeds from sale of discontinued operations | 4,300,000 | ' | ' |
Book value of asset held for sale | $10,100,000 | ' | ' |
Summarized_Activity_in_Consoli
Summarized Activity in Consolidated Statements of Income for Discontinued Operations (Detail) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2013 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' |
Revenue | $10,378 |
Operating loss | -4,603 |
Loss before provision for income taxes | -5,109 |
Provision for income taxes | 227 |
Loss from discontinued operations | ($5,336) |
Recovered_Sheet4
Segment and Geographic Information - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2014 | |
Segment | |
Segment Reporting Information [Line Items] | ' |
Number of operating segments | 1 |