5. Segment information

Primary segments

A business segment is a group of assets and operations engaged in providing products and services subject to risks and returns that are different from those of other business segments.

Operating divisions

The Group is divided operationally on a worldwide basis into three divisions, Digital Television Solutions, Public Access and Middleware & Advertising. These divisions, which are also based on internal management structures, can be described as follows:

  • The Digital TV Solutions division provides open conditional access solutions allowing digital TV and content providers to operate a wide range of high value-added pay TV services on a secure platform.
  • The Public Access division provides access control systems and ticketing services for ski lifts, car parks, stadiums, concert halls and important events as well as multifunctional cards for universities and corporations.
  • The Middleware & Advertising division provides middleware software, applications, including advanced advertising and interactive services as well as professional services for digital and interactive television.

Corporate

Income and expenses relating to Corporate include the costs of Group Headquarters and the items of income and expense which are not directly attributable to specific divisions.

Intersegment sales

Inter-segment transactions are contracted on arm’s length basis.

The primary segment information for 2007 and 2006 is as follows:

Operating divisions
Digital Television Solutions Public Access Middleware & Advertising Corporate Eliminations Total
In CHF’000 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006
Revenues
External sales 573 410 500 593 224 303 193 747 128 100 - - - - - 925 813 694 340
Inter-segment sales 8 667 6 691 101 873 499 - - - -9 267 -7 564 - -
Total revenues 582 077 507 284 224 404 194 620 128 599 - - - -9 267 -7 564 925 813 694 340
Income statement
Operating income (EBIT) 87 981 92 357 25 776 76 705 -7 575 - -18 527 -18 855 87 655 150 207
Interest expense and other Finance income/(expense), net -7 734 -3 142
Share of result of associates -109 144 2 574 3 087 - - - - 2 465 3 231
Income before tax 82 386 150 296
Income tax expense -14 938 -11 766
Net income for the year 67 448 138 530
Balance sheet
Assets
Segment assets 679 151 584 850 186 140 170 844 280 171 - 48 007 278 878 1 193 469 1 034 572
Investments in associates - 351 10 700 9 090 - - - - 10 700 9 441
679 151 585 201 196 840 179 934 280 171 - 48 007 278 878 1 204 169 1 044 013
Liabilities
Segment liabilities 130 655 131 640 81 233 77 556 40 556 - 326 170 319 549 578 614 528 745
Other information
Capital expenditures 75 495 58 425 13 831 10 891 4 078 - - - 93 404 69 316
Depreciation and amortization -33 290 -33 807 -6 206 -4 108 -7 118 - - -40 -46 614 -37 955
Impairment losses -2 897 - - - - - - - -2 897 -

Expenses, assets and liabilities relating to Corporate include the costs, assets and liabilities of Group headquarters and the items of expenses, assets and liabilities which are not directly attributable to specific divisions.

Secondary segments

A geographical segment provides products or services within a particular economic environment that is subject to risks and returns that are different from those segments operating in other economic environments.

Sales

Digital Television
Solutions		 Public Access Middleware &
Advertising		 Total
In CHF’000 2007 2006 2007 2006 2007 2006 2007 2006
Europe 321 996 286 134 186 420 162 749 56 918 - 565 334 448 883
Americas 139 898 143 183 18 378 16 042 33 861 - 192 137 159 225
Asia & Oceania 109 280 69 404 19 200 14 496 31 027 - 159 507 83 900
Africa 2 236 1 872 305 460 6 294 - 8 835 2 332
573 410 500 593 224 303 193 747 128 100 - 925 813 694 340

Sales are allocated based on where the client is located.

Other geographical information

In CHF’000 Europe Americas Others Total
Total assets as of December 31,
-2007 789 049 412 635 2 485 1 204 169
-2006 928 055 109 891 6 067 1 044 013
Capital expenditures for
-2007 87 855 5 459 90 93 404
-2006 67 864 832 620 69 316

Assets and capital expenditures are allocated based on location of the entity owning the assets.

Revenue categories

In CHF’000 2007 2006
Sale of goods 546 924 481 891
Services rendered 215 985 158 987
Royalties and licenses 162 904 53 462
925 813 694 340