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As of December 31, 2013 | ||||||||||||
($000) | Previously Reported | Correction | As Corrected | |||||||||
Accounts payable and accrued liabilities | $ | 52,877 | $ | (10,746 | ) | $ | 42,131 | |||||
Deferred rent | $ | 13,192 | $ | 10,746 | $ | 23,938 |
|
|
|
($000) | ||||
Cash and cash equivalents | $ | 3,739 | ||
Accounts receivable and other current assets | 150 | |||
Other current and non-current assets | 318 | |||
Deferred tax asset | 7,340 | |||
Intangible assets | 9,460 | |||
Goodwill | 40,472 | |||
Deferred revenue | (2,897 | ) | ||
Deferred tax liability | (3,595 | ) | ||
Other current and non-current liabilities | (981 | ) | ||
Total fair value of HelloWallet | $ | 54,006 |
($000) | Weighted Average Useful Life (years) | |||||
Technology based assets | 6,670 | 5 | ||||
Intellectual property (trademarks and trade names) | 169 | 3 | ||||
Non-competition agreement | 2,621 | 5 | ||||
Total intangible assets | $ | 9,460 | 5 |
($000) | ||||
Cash and cash equivalents | $ | 287 | ||
Accounts receivable and other current assets | 152 | |||
Deferred tax asset | 3,685 | |||
Other current and non-current assets | 257 | |||
Intangible assets | 8,681 | |||
Goodwill | 18,778 | |||
Deferred revenue | (79 | ) | ||
Deferred tax liability | (3,299 | ) | ||
Other current and non-current liabilities | (513 | ) | ||
Total purchase price | $ | 27,949 |
($000) | Weighted Average Useful Life (years) | |||||
Customer-related assets | $ | 5,506 | 24 | |||
Technology-based assets | 3,020 | 4.5 | ||||
Intellectual property (trademarks and trade names) | 47 | 1 | ||||
Non-competition agreement | 108 | 3 | ||||
Total intangible assets | $ | 8,681 | 19 |
($000) | ||||
Balance as of December 31, 2013 | $ | 326,450 | ||
Acquisitions of HelloWallet and ByAllAccounts | 59,250 | |||
Foreign currency translation | (6,731 | ) | ||
Balance as of September 30, 2014 | $ | 378,969 |
As of September 30, 2014 | As of December 31, 2013 | |||||||||||||||||||||||||||
($000) | Gross | Accumulated Amortization | Net | Weighted Average Useful Life (years) | Gross | Accumulated Amortization | Net | Weighted Average Useful Life (years) | ||||||||||||||||||||
Intellectual property | $ | 29,539 | $ | (24,844 | ) | $ | 4,695 | 9 | $ | 29,477 | $ | (23,128 | ) | $ | 6,349 | 9 | ||||||||||||
Customer-related assets | 144,359 | (82,076 | ) | 62,283 | 12 | 141,833 | (74,311 | ) | 67,522 | 12 | ||||||||||||||||||
Supplier relationships | 240 | (117 | ) | 123 | 20 | 240 | (108 | ) | 132 | 20 | ||||||||||||||||||
Technology-based assets | 89,789 | (56,050 | ) | 33,739 | 8 | 80,489 | (50,673 | ) | 29,816 | 9 | ||||||||||||||||||
Non-competition agreement | 4,379 | (1,776 | ) | 2,603 | 5 | 1,661 | (1,571 | ) | 90 | 4 | ||||||||||||||||||
Total intangible assets | $ | 268,306 | $ | (164,863 | ) | $ | 103,443 | 11 | $ | 253,700 | $ | (149,791 | ) | $ | 103,909 | 10 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Amortization expense | $ | 5,912 | $ | 5,287 | $ | 16,555 | $ | 16,249 |
($000) | ||||
2014 | $ | 22,059 | ||
2015 | 22,251 | |||
2016 | 17,693 | |||
2017 | 13,145 | |||
2018 | 10,965 | |||
Thereafter | 33,885 |
|
External revenue by product group | ||||||||||||||||
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Investment information | $ | 152,252 | $ | 137,216 | $ | 443,049 | $ | 412,332 | ||||||||
Investment management | 40,854 | 36,266 | 120,607 | 105,434 | ||||||||||||
Consolidated revenue | $ | 193,106 | $ | 173,482 | $ | 563,656 | $ | 517,766 |
External revenue by geographical area | ||||||||||||||||
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
United States | $ | 141,276 | $ | 124,998 | $ | 407,681 | $ | 372,746 | ||||||||
United Kingdom | 15,190 | 14,148 | 46,071 | 41,316 | ||||||||||||
Continental Europe | 15,562 | 14,666 | 47,109 | 41,826 | ||||||||||||
Australia | 8,866 | 8,041 | 26,267 | 26,569 | ||||||||||||
Canada | 7,391 | 7,603 | 22,599 | 23,151 | ||||||||||||
Asia | 3,950 | 3,363 | 11,547 | 10,236 | ||||||||||||
Other | 871 | 663 | 2,382 | 1,922 | ||||||||||||
Total International | 51,830 | 48,484 | 155,975 | 145,020 | ||||||||||||
Consolidated revenue | $ | 193,106 | $ | 173,482 | $ | 563,656 | $ | 517,766 |
Long-lived assets by geographical area | ||||||||
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
United States | $ | 94,103 | $ | 84,321 | ||||
United Kingdom | 6,994 | 6,873 | ||||||
Continental Europe | 1,410 | 1,873 | ||||||
Australia | 926 | 1,051 | ||||||
Canada | 926 | 1,275 | ||||||
Asia | 8,138 | 9,479 | ||||||
Other | 87 | 114 | ||||||
Total International | 18,481 | 20,665 | ||||||
Consolidated property, equipment, and capitalized software, net | $ | 112,584 | $ | 104,986 |
|
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
Available-for-sale | $ | 12,226 | $ | 91,461 | ||||
Held-to-maturity | 18,059 | 31,214 | ||||||
Trading securities | 8,205 | 7,732 | ||||||
Total | $ | 38,490 | $ | 130,407 |
As of September 30, 2014 | As of December 31, 2013 | |||||||||||||||||||||||||||||||
($000) | Cost | Unrealized Gain | Unrealized Loss | Fair Value | Cost | Unrealized Gain | Unrealized Loss | Fair Value | ||||||||||||||||||||||||
Available-for-sale: | ||||||||||||||||||||||||||||||||
Government obligations | $ | — | $ | — | $ | — | $ | — | $ | 19,693 | $ | 8 | $ | (3 | ) | $ | 19,698 | |||||||||||||||
Corporate bonds | — | — | — | — | 49,913 | 22 | (124 | ) | 49,811 | |||||||||||||||||||||||
Foreign obligations | — | — | — | — | 505 | — | (2 | ) | 503 | |||||||||||||||||||||||
Commercial paper | — | — | — | — | 9,482 | 7 | — | 9,489 | ||||||||||||||||||||||||
Equity securities and exchange-traded funds | 6,499 | 477 | (81 | ) | 6,895 | 8,872 | 1,011 | (141 | ) | 9,742 | ||||||||||||||||||||||
Mutual funds | 5,097 | 372 | (138 | ) | 5,331 | 2,095 | 221 | (98 | ) | 2,218 | ||||||||||||||||||||||
Total | $ | 11,596 | $ | 849 | $ | (219 | ) | $ | 12,226 | $ | 90,560 | $ | 1,269 | $ | (368 | ) | $ | 91,461 | ||||||||||||||
Held-to-maturity: | ||||||||||||||||||||||||||||||||
Certificates of deposit | $ | 18,059 | $ | — | $ | — | $ | 18,059 | $ | 31,214 | $ | — | $ | — | $ | 31,214 |
As of September 30, 2014 | As of December 31, 2013 | |||||||||||||||
($000) | Cost | Fair Value | Cost | Fair Value | ||||||||||||
Available-for-sale: | ||||||||||||||||
Due in one year or less | $ | — | $ | — | $ | 45,486 | $ | 45,402 | ||||||||
Due in one to two years | — | — | 34,107 | 34,099 | ||||||||||||
Equity securities, exchange-traded funds, and mutual funds | 11,596 | 12,226 | 10,967 | 11,960 | ||||||||||||
Total | $ | 11,596 | $ | 12,226 | $ | 90,560 | $ | 91,461 | ||||||||
Held-to-maturity: | ||||||||||||||||
Due in one year or less | $ | 18,054 | $ | 18,054 | $ | 31,210 | $ | 31,210 | ||||||||
Due in one to three years | 5 | 5 | 4 | 4 | ||||||||||||
Total | $ | 18,059 | $ | 18,059 | $ | 31,214 | $ | 31,214 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Realized gains | $ | 158 | $ | 94 | $ | 731 | $ | 2,320 | ||||||||
Realized losses | — | (136 | ) | (226 | ) | (1,214 | ) | |||||||||
Realized gains (losses), net | $ | 158 | $ | (42 | ) | $ | 505 | $ | 1,106 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Unrealized gains (losses), net | $ | 272 | $ | (741 | ) | $ | 117 | $ | (468 | ) |
Fair Value | Fair Value Measurements as of September 30, 2014 | |||||||||||||||
as of | Using Fair Value Hierarchy | |||||||||||||||
($000) | September 30, 2014 | Level 1 | Level 2 | Level 3 | ||||||||||||
Available-for-sale investments: | ||||||||||||||||
Government obligations | $ | — | $ | — | $ | — | $ | — | ||||||||
Corporate bonds | — | — | — | — | ||||||||||||
Foreign obligations | — | — | — | — | ||||||||||||
Commercial paper | — | — | — | — | ||||||||||||
Equity securities and exchange-traded funds | 6,895 | 6,895 | — | — | ||||||||||||
Mutual funds | 5,331 | 5,331 | — | — | ||||||||||||
Trading securities | 8,205 | 8,205 | — | — | ||||||||||||
Cash equivalents | 428 | 428 | — | — | ||||||||||||
Total | $ | 20,859 | $ | 20,859 | $ | — | $ | — |
Fair Value | Fair Value Measurements as of December 31, 2013 | |||||||||||||||
as of | Using Fair Value Hierarchy | |||||||||||||||
($000) | December 31, 2013 | Level 1 | Level 2 | Level 3 | ||||||||||||
Available-for-sale investments: | ||||||||||||||||
Government obligations | $ | 19,698 | $ | — | $ | 19,698 | $ | — | ||||||||
Corporate bonds | 49,811 | — | 49,811 | — | ||||||||||||
Foreign obligations | 503 | — | 503 | — | ||||||||||||
Commercial paper | 9,489 | — | 9,489 | — | ||||||||||||
Equity securities and exchange-traded funds | 9,742 | 9,742 | — | — | ||||||||||||
Mutual funds | 2,218 | 2,218 | — | — | ||||||||||||
Trading securities | 7,732 | 7,732 | — | — | ||||||||||||
Cash equivalents | 925 | 925 | — | — | ||||||||||||
Total | $ | 100,118 | $ | 20,617 | $ | 79,501 | $ | — |
Level 1: | Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access. |
Level 2: | Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly. |
Level 3: | Valuations based on inputs that are unobservable and significant to the overall fair value measurement. |
|
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
Investment in MJKK | $ | 22,615 | $ | 21,782 | ||||
Other equity method investments | 5,440 | 6,166 | ||||||
Investments accounted for using the cost method | 2,373 | 10,766 | ||||||
Total investments in unconsolidated entities | $ | 30,428 | $ | 38,714 |
As of September 30 | As of December 31 | |||||||
2014 | 2013 | |||||||
Morningstar’s approximate ownership of MJKK | 34 | % | 34 | % | ||||
Approximate market value of Morningstar’s ownership in MJKK: | ||||||||
Japanese yen (¥000) | ¥ | 7,264,858 | ¥ | 9,824,068 | ||||
Equivalent U.S. dollars ($000) | $ | 66,401 | $ | 94,999 |
|
As of September 30 | |||
(in thousands) | 2014 | ||
Shares available for future grants | 4,257 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Restricted stock units | $ | 4,587 | $ | 3,196 | $ | 12,262 | $ | 10,493 | ||||||||
Restricted stock | 97 | 97 | 291 | 291 | ||||||||||||
Performance share awards | 172 | — | 372 | — | ||||||||||||
Stock options | 95 | 123 | 328 | 369 | ||||||||||||
Total stock-based compensation expense | $ | 4,951 | $ | 3,416 | $ | 13,253 | $ | 11,153 | ||||||||
Income tax benefit related to the stock-based compensation expense | $ | 1,446 | $ | 846 | $ | 3,808 | $ | 2,944 |
Unrecognized stock-based compensation expense ($000) | Expected amortization period (months) | |||||
Restricted stock units | $ | 34,989 | 34 | |||
Restricted stock | 257 | 9 | ||||
Performance share awards | 1,545 | 27 | ||||
Stock options | 226 | 7 | ||||
Total unrecognized stock-based compensation expense | $ | 37,017 | 33 |
Restricted Stock Units (RSUs) | Unvested | Vested but Deferred | Total | Weighted Average Grant Date Value per RSU | |||||||||
RSUs outstanding—December 31, 2013 | 680,002 | 16,682 | 696,684 | $ | 62.02 | ||||||||
Granted | 245,350 | — | 245,350 | 73.11 | |||||||||
Dividend equivalents | 2,083 | 113 | 2,196 | 58.13 | |||||||||
Vested | (235,053 | ) | — | (235,053 | ) | 57.48 | |||||||
Issued | — | (2,054 | ) | (2,054 | ) | 53.54 | |||||||
Forfeited | (27,673 | ) | — | (27,673 | ) | 64.45 | |||||||
RSUs Outstanding - September 30, 2014 | 664,709 | 14,741 | 679,450 | $ | 67.49 |
As of September 30, 2014 | ||||
Target performance share awards granted | 23,685 | |||
Fair value per award (1) | $ | 80.91 | ||
Number of shares that would be issued based on current performance levels | 23,685 | |||
Unamortized expense, based on current performance levels | $ | 1,545,000 |
Options Granted At an Exercise Price Below the Fair Value Per Share on the Grant Date | Underlying Shares | Weighted Average Exercise Price | |||||
Options outstanding—December 31, 2013 | 179,559 | $ | 21.47 | ||||
Granted | — | — | |||||
Canceled | — | — | |||||
Exercised | (93,116 | ) | 21.92 | ||||
Options outstanding—September 30, 2014 | 86,443 | 22.14 | |||||
Options exercisable—September 30, 2014 | 86,443 | $ | 22.14 |
All Other Option Grants, Excluding Activity Shown Above | Underlying Shares | Weighted Average Exercise Price | |||||
Options outstanding—December 31, 2013 | 253,972 | $ | 36.48 | ||||
Granted | — | — | |||||
Canceled | — | — | |||||
Exercised | (58,326 | ) | 30.09 | ||||
Options outstanding—September 30, 2014 | 195,646 | 39.02 | |||||
Options exercisable—September 30, 2014 | 179,176 | $ | 37.31 |
Nine months ended September 30 | ||||||||
($000) | 2014 | 2013 | ||||||
Intrinsic value of options exercised | $ | 7,238 | $ | 8,964 |
Options Outstanding | Options Exercisable | |||||||||||||||||||||||||
Range of Exercise Prices | Number of Options | Weighted Average Remaining Contractual Life (years) | Weighted Average Exercise Price | Aggregate Intrinsic Value ($000) | Exercisable Shares | Weighted Average Remaining Contractual Life (years) | Weighted Average Exercise Price | Aggregate Intrinsic Value ($000) | ||||||||||||||||||
$22.06 - $27.24 | 203,908 | 0.42 | $ | 25.08 | $ | 8,732 | 203,908 | 0.42 | $ | 25.08 | $ | 8,732 | ||||||||||||||
$40.08 - $50.46 | 6,506 | 1.17 | 48.61 | 125 | 6,506 | 1.17 | 48.61 | 125 | ||||||||||||||||||
$57.28 - $59.35 | 71,675 | 6.76 | 57.46 | 749 | 55,205 | 6.75 | 57.39 | 555 | ||||||||||||||||||
$22.06 - $59.35 | 282,089 | 2.05 | $ | 33.85 | $ | 9,606 | 265,619 | 1.75 | $ | 32.37 | $ | 9,412 | ||||||||||||||
Vested or Expected to Vest | ||||||||||||||||||||||||||
$22.06 - $59.35 | 282,089 | 2.05 | $ | 33.85 | $ | 9,606 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Excess tax benefits related to stock-based compensation | $ | 1,032 | $ | 251 | $ | 2,945 | $ | 4,093 |
|
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Income before income taxes and equity in net income of unconsolidated entities | $ | 44,963 | $ | 45,384 | $ | 65,478 | $ | 133,584 | ||||||||
Equity in net income of unconsolidated entities | 337 | 315 | 1,433 | 1,172 | ||||||||||||
Net loss attributable to the noncontrolling interest | 29 | 29 | 64 | 93 | ||||||||||||
Total | $ | 45,329 | $ | 45,728 | $ | 66,975 | $ | 134,849 | ||||||||
Income tax expense | $ | 15,149 | $ | 14,265 | $ | 20,188 | $ | 42,647 | ||||||||
Effective tax rate | 33.4 | % | 31.2 | % | 30.1 | % | 31.6 | % |
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
Gross unrecognized tax benefits | $ | 11,469 | $ | 12,958 | ||||
Gross unrecognized tax benefits that would affect income tax expense | $ | 11,469 | $ | 10,557 | ||||
Decrease in income tax expense upon recognition of gross unrecognized tax benefits | $ | 9,932 | $ | 9,262 |
As of September 30 | As of December 31 | |||||||
Liabilities for Unrecognized Tax Benefits ($000) | 2014 | 2013 | ||||||
Current liability | $ | 4,075 | $ | 6,211 | ||||
Non-current liability | 7,085 | 6,012 | ||||||
Total liability for unrecognized tax benefits | $ | 11,160 | $ | 12,223 |
|
|
|
As of December 31, 2013 | ||||||||||||
($000) | Previously Reported | Correction | As Corrected | |||||||||
Accounts payable and accrued liabilities | $ | 52,877 | $ | (10,746 | ) | $ | 42,131 | |||||
Deferred rent | $ | 13,192 | $ | 10,746 | $ | 23,938 |
|
($000) | ||||
Balance as of December 31, 2013 | $ | 326,450 | ||
Acquisitions of HelloWallet and ByAllAccounts | 59,250 | |||
Foreign currency translation | (6,731 | ) | ||
Balance as of September 30, 2014 | $ | 378,969 |
As of September 30, 2014 | As of December 31, 2013 | |||||||||||||||||||||||||||
($000) | Gross | Accumulated Amortization | Net | Weighted Average Useful Life (years) | Gross | Accumulated Amortization | Net | Weighted Average Useful Life (years) | ||||||||||||||||||||
Intellectual property | $ | 29,539 | $ | (24,844 | ) | $ | 4,695 | 9 | $ | 29,477 | $ | (23,128 | ) | $ | 6,349 | 9 | ||||||||||||
Customer-related assets | 144,359 | (82,076 | ) | 62,283 | 12 | 141,833 | (74,311 | ) | 67,522 | 12 | ||||||||||||||||||
Supplier relationships | 240 | (117 | ) | 123 | 20 | 240 | (108 | ) | 132 | 20 | ||||||||||||||||||
Technology-based assets | 89,789 | (56,050 | ) | 33,739 | 8 | 80,489 | (50,673 | ) | 29,816 | 9 | ||||||||||||||||||
Non-competition agreement | 4,379 | (1,776 | ) | 2,603 | 5 | 1,661 | (1,571 | ) | 90 | 4 | ||||||||||||||||||
Total intangible assets | $ | 268,306 | $ | (164,863 | ) | $ | 103,443 | 11 | $ | 253,700 | $ | (149,791 | ) | $ | 103,909 | 10 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Amortization expense | $ | 5,912 | $ | 5,287 | $ | 16,555 | $ | 16,249 |
($000) | ||||
2014 | $ | 22,059 | ||
2015 | 22,251 | |||
2016 | 17,693 | |||
2017 | 13,145 | |||
2018 | 10,965 | |||
Thereafter | 33,885 |
($000) | ||||
Cash and cash equivalents | $ | 3,739 | ||
Accounts receivable and other current assets | 150 | |||
Other current and non-current assets | 318 | |||
Deferred tax asset | 7,340 | |||
Intangible assets | 9,460 | |||
Goodwill | 40,472 | |||
Deferred revenue | (2,897 | ) | ||
Deferred tax liability | (3,595 | ) | ||
Other current and non-current liabilities | (981 | ) | ||
Total fair value of HelloWallet | $ | 54,006 |
($000) | Weighted Average Useful Life (years) | |||||
Technology based assets | 6,670 | 5 | ||||
Intellectual property (trademarks and trade names) | 169 | 3 | ||||
Non-competition agreement | 2,621 | 5 | ||||
Total intangible assets | $ | 9,460 | 5 |
($000) | ||||
Cash and cash equivalents | $ | 287 | ||
Accounts receivable and other current assets | 152 | |||
Deferred tax asset | 3,685 | |||
Other current and non-current assets | 257 | |||
Intangible assets | 8,681 | |||
Goodwill | 18,778 | |||
Deferred revenue | (79 | ) | ||
Deferred tax liability | (3,299 | ) | ||
Other current and non-current liabilities | (513 | ) | ||
Total purchase price | $ | 27,949 |
($000) | Weighted Average Useful Life (years) | |||||
Customer-related assets | $ | 5,506 | 24 | |||
Technology-based assets | 3,020 | 4.5 | ||||
Intellectual property (trademarks and trade names) | 47 | 1 | ||||
Non-competition agreement | 108 | 3 | ||||
Total intangible assets | $ | 8,681 | 19 |
|
External revenue by product group | ||||||||||||||||
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Investment information | $ | 152,252 | $ | 137,216 | $ | 443,049 | $ | 412,332 | ||||||||
Investment management | 40,854 | 36,266 | 120,607 | 105,434 | ||||||||||||
Consolidated revenue | $ | 193,106 | $ | 173,482 | $ | 563,656 | $ | 517,766 |
External revenue by geographical area | ||||||||||||||||
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
United States | $ | 141,276 | $ | 124,998 | $ | 407,681 | $ | 372,746 | ||||||||
United Kingdom | 15,190 | 14,148 | 46,071 | 41,316 | ||||||||||||
Continental Europe | 15,562 | 14,666 | 47,109 | 41,826 | ||||||||||||
Australia | 8,866 | 8,041 | 26,267 | 26,569 | ||||||||||||
Canada | 7,391 | 7,603 | 22,599 | 23,151 | ||||||||||||
Asia | 3,950 | 3,363 | 11,547 | 10,236 | ||||||||||||
Other | 871 | 663 | 2,382 | 1,922 | ||||||||||||
Total International | 51,830 | 48,484 | 155,975 | 145,020 | ||||||||||||
Consolidated revenue | $ | 193,106 | $ | 173,482 | $ | 563,656 | $ | 517,766 |
Long-lived assets by geographical area | ||||||||
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
United States | $ | 94,103 | $ | 84,321 | ||||
United Kingdom | 6,994 | 6,873 | ||||||
Continental Europe | 1,410 | 1,873 | ||||||
Australia | 926 | 1,051 | ||||||
Canada | 926 | 1,275 | ||||||
Asia | 8,138 | 9,479 | ||||||
Other | 87 | 114 | ||||||
Total International | 18,481 | 20,665 | ||||||
Consolidated property, equipment, and capitalized software, net | $ | 112,584 | $ | 104,986 |
|
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
Available-for-sale | $ | 12,226 | $ | 91,461 | ||||
Held-to-maturity | 18,059 | 31,214 | ||||||
Trading securities | 8,205 | 7,732 | ||||||
Total | $ | 38,490 | $ | 130,407 |
As of September 30, 2014 | As of December 31, 2013 | |||||||||||||||||||||||||||||||
($000) | Cost | Unrealized Gain | Unrealized Loss | Fair Value | Cost | Unrealized Gain | Unrealized Loss | Fair Value | ||||||||||||||||||||||||
Available-for-sale: | ||||||||||||||||||||||||||||||||
Government obligations | $ | — | $ | — | $ | — | $ | — | $ | 19,693 | $ | 8 | $ | (3 | ) | $ | 19,698 | |||||||||||||||
Corporate bonds | — | — | — | — | 49,913 | 22 | (124 | ) | 49,811 | |||||||||||||||||||||||
Foreign obligations | — | — | — | — | 505 | — | (2 | ) | 503 | |||||||||||||||||||||||
Commercial paper | — | — | — | — | 9,482 | 7 | — | 9,489 | ||||||||||||||||||||||||
Equity securities and exchange-traded funds | 6,499 | 477 | (81 | ) | 6,895 | 8,872 | 1,011 | (141 | ) | 9,742 | ||||||||||||||||||||||
Mutual funds | 5,097 | 372 | (138 | ) | 5,331 | 2,095 | 221 | (98 | ) | 2,218 | ||||||||||||||||||||||
Total | $ | 11,596 | $ | 849 | $ | (219 | ) | $ | 12,226 | $ | 90,560 | $ | 1,269 | $ | (368 | ) | $ | 91,461 | ||||||||||||||
Held-to-maturity: | ||||||||||||||||||||||||||||||||
Certificates of deposit | $ | 18,059 | $ | — | $ | — | $ | 18,059 | $ | 31,214 | $ | — | $ | — | $ | 31,214 |
As of September 30, 2014 | As of December 31, 2013 | |||||||||||||||
($000) | Cost | Fair Value | Cost | Fair Value | ||||||||||||
Available-for-sale: | ||||||||||||||||
Due in one year or less | $ | — | $ | — | $ | 45,486 | $ | 45,402 | ||||||||
Due in one to two years | — | — | 34,107 | 34,099 | ||||||||||||
Equity securities, exchange-traded funds, and mutual funds | 11,596 | 12,226 | 10,967 | 11,960 | ||||||||||||
Total | $ | 11,596 | $ | 12,226 | $ | 90,560 | $ | 91,461 | ||||||||
Held-to-maturity: | ||||||||||||||||
Due in one year or less | $ | 18,054 | $ | 18,054 | $ | 31,210 | $ | 31,210 | ||||||||
Due in one to three years | 5 | 5 | 4 | 4 | ||||||||||||
Total | $ | 18,059 | $ | 18,059 | $ | 31,214 | $ | 31,214 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Realized gains | $ | 158 | $ | 94 | $ | 731 | $ | 2,320 | ||||||||
Realized losses | — | (136 | ) | (226 | ) | (1,214 | ) | |||||||||
Realized gains (losses), net | $ | 158 | $ | (42 | ) | $ | 505 | $ | 1,106 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Unrealized gains (losses), net | $ | 272 | $ | (741 | ) | $ | 117 | $ | (468 | ) |
Fair Value | Fair Value Measurements as of September 30, 2014 | |||||||||||||||
as of | Using Fair Value Hierarchy | |||||||||||||||
($000) | September 30, 2014 | Level 1 | Level 2 | Level 3 | ||||||||||||
Available-for-sale investments: | ||||||||||||||||
Government obligations | $ | — | $ | — | $ | — | $ | — | ||||||||
Corporate bonds | — | — | — | — | ||||||||||||
Foreign obligations | — | — | — | — | ||||||||||||
Commercial paper | — | — | — | — | ||||||||||||
Equity securities and exchange-traded funds | 6,895 | 6,895 | — | — | ||||||||||||
Mutual funds | 5,331 | 5,331 | — | — | ||||||||||||
Trading securities | 8,205 | 8,205 | — | — | ||||||||||||
Cash equivalents | 428 | 428 | — | — | ||||||||||||
Total | $ | 20,859 | $ | 20,859 | $ | — | $ | — |
Fair Value | Fair Value Measurements as of December 31, 2013 | |||||||||||||||
as of | Using Fair Value Hierarchy | |||||||||||||||
($000) | December 31, 2013 | Level 1 | Level 2 | Level 3 | ||||||||||||
Available-for-sale investments: | ||||||||||||||||
Government obligations | $ | 19,698 | $ | — | $ | 19,698 | $ | — | ||||||||
Corporate bonds | 49,811 | — | 49,811 | — | ||||||||||||
Foreign obligations | 503 | — | 503 | — | ||||||||||||
Commercial paper | 9,489 | — | 9,489 | — | ||||||||||||
Equity securities and exchange-traded funds | 9,742 | 9,742 | — | — | ||||||||||||
Mutual funds | 2,218 | 2,218 | — | — | ||||||||||||
Trading securities | 7,732 | 7,732 | — | — | ||||||||||||
Cash equivalents | 925 | 925 | — | — | ||||||||||||
Total | $ | 100,118 | $ | 20,617 | $ | 79,501 | $ | — |
|
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
Investment in MJKK | $ | 22,615 | $ | 21,782 | ||||
Other equity method investments | 5,440 | 6,166 | ||||||
Investments accounted for using the cost method | 2,373 | 10,766 | ||||||
Total investments in unconsolidated entities | $ | 30,428 | $ | 38,714 |
As of September 30 | As of December 31 | |||||||
2014 | 2013 | |||||||
Morningstar’s approximate ownership of MJKK | 34 | % | 34 | % | ||||
Approximate market value of Morningstar’s ownership in MJKK: | ||||||||
Japanese yen (¥000) | ¥ | 7,264,858 | ¥ | 9,824,068 | ||||
Equivalent U.S. dollars ($000) | $ | 66,401 | $ | 94,999 |
|
As of September 30 | |||
(in thousands) | 2014 | ||
Shares available for future grants | 4,257 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Restricted stock units | $ | 4,587 | $ | 3,196 | $ | 12,262 | $ | 10,493 | ||||||||
Restricted stock | 97 | 97 | 291 | 291 | ||||||||||||
Performance share awards | 172 | — | 372 | — | ||||||||||||
Stock options | 95 | 123 | 328 | 369 | ||||||||||||
Total stock-based compensation expense | $ | 4,951 | $ | 3,416 | $ | 13,253 | $ | 11,153 | ||||||||
Income tax benefit related to the stock-based compensation expense | $ | 1,446 | $ | 846 | $ | 3,808 | $ | 2,944 |
Unrecognized stock-based compensation expense ($000) | Expected amortization period (months) | |||||
Restricted stock units | $ | 34,989 | 34 | |||
Restricted stock | 257 | 9 | ||||
Performance share awards | 1,545 | 27 | ||||
Stock options | 226 | 7 | ||||
Total unrecognized stock-based compensation expense | $ | 37,017 | 33 |
Restricted Stock Units (RSUs) | Unvested | Vested but Deferred | Total | Weighted Average Grant Date Value per RSU | |||||||||
RSUs outstanding—December 31, 2013 | 680,002 | 16,682 | 696,684 | $ | 62.02 | ||||||||
Granted | 245,350 | — | 245,350 | 73.11 | |||||||||
Dividend equivalents | 2,083 | 113 | 2,196 | 58.13 | |||||||||
Vested | (235,053 | ) | — | (235,053 | ) | 57.48 | |||||||
Issued | — | (2,054 | ) | (2,054 | ) | 53.54 | |||||||
Forfeited | (27,673 | ) | — | (27,673 | ) | 64.45 | |||||||
RSUs Outstanding - September 30, 2014 | 664,709 | 14,741 | 679,450 | $ | 67.49 |
As of September 30, 2014 | ||||
Target performance share awards granted | 23,685 | |||
Fair value per award (1) | $ | 80.91 | ||
Number of shares that would be issued based on current performance levels | 23,685 | |||
Unamortized expense, based on current performance levels | $ | 1,545,000 |
Options Granted At an Exercise Price Below the Fair Value Per Share on the Grant Date | Underlying Shares | Weighted Average Exercise Price | |||||
Options outstanding—December 31, 2013 | 179,559 | $ | 21.47 | ||||
Granted | — | — | |||||
Canceled | — | — | |||||
Exercised | (93,116 | ) | 21.92 | ||||
Options outstanding—September 30, 2014 | 86,443 | 22.14 | |||||
Options exercisable—September 30, 2014 | 86,443 | $ | 22.14 |
All Other Option Grants, Excluding Activity Shown Above | Underlying Shares | Weighted Average Exercise Price | |||||
Options outstanding—December 31, 2013 | 253,972 | $ | 36.48 | ||||
Granted | — | — | |||||
Canceled | — | — | |||||
Exercised | (58,326 | ) | 30.09 | ||||
Options outstanding—September 30, 2014 | 195,646 | 39.02 | |||||
Options exercisable—September 30, 2014 | 179,176 | $ | 37.31 |
Nine months ended September 30 | ||||||||
($000) | 2014 | 2013 | ||||||
Intrinsic value of options exercised | $ | 7,238 | $ | 8,964 |
Options Outstanding | Options Exercisable | |||||||||||||||||||||||||
Range of Exercise Prices | Number of Options | Weighted Average Remaining Contractual Life (years) | Weighted Average Exercise Price | Aggregate Intrinsic Value ($000) | Exercisable Shares | Weighted Average Remaining Contractual Life (years) | Weighted Average Exercise Price | Aggregate Intrinsic Value ($000) | ||||||||||||||||||
$22.06 - $27.24 | 203,908 | 0.42 | $ | 25.08 | $ | 8,732 | 203,908 | 0.42 | $ | 25.08 | $ | 8,732 | ||||||||||||||
$40.08 - $50.46 | 6,506 | 1.17 | 48.61 | 125 | 6,506 | 1.17 | 48.61 | 125 | ||||||||||||||||||
$57.28 - $59.35 | 71,675 | 6.76 | 57.46 | 749 | 55,205 | 6.75 | 57.39 | 555 | ||||||||||||||||||
$22.06 - $59.35 | 282,089 | 2.05 | $ | 33.85 | $ | 9,606 | 265,619 | 1.75 | $ | 32.37 | $ | 9,412 | ||||||||||||||
Vested or Expected to Vest | ||||||||||||||||||||||||||
$22.06 - $59.35 | 282,089 | 2.05 | $ | 33.85 | $ | 9,606 |
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Excess tax benefits related to stock-based compensation | $ | 1,032 | $ | 251 | $ | 2,945 | $ | 4,093 |
|
Three months ended September 30 | Nine months ended September 30 | |||||||||||||||
($000) | 2014 | 2013 | 2014 | 2013 | ||||||||||||
Income before income taxes and equity in net income of unconsolidated entities | $ | 44,963 | $ | 45,384 | $ | 65,478 | $ | 133,584 | ||||||||
Equity in net income of unconsolidated entities | 337 | 315 | 1,433 | 1,172 | ||||||||||||
Net loss attributable to the noncontrolling interest | 29 | 29 | 64 | 93 | ||||||||||||
Total | $ | 45,329 | $ | 45,728 | $ | 66,975 | $ | 134,849 | ||||||||
Income tax expense | $ | 15,149 | $ | 14,265 | $ | 20,188 | $ | 42,647 | ||||||||
Effective tax rate | 33.4 | % | 31.2 | % | 30.1 | % | 31.6 | % |
As of September 30 | As of December 31 | |||||||
($000) | 2014 | 2013 | ||||||
Gross unrecognized tax benefits | $ | 11,469 | $ | 12,958 | ||||
Gross unrecognized tax benefits that would affect income tax expense | $ | 11,469 | $ | 10,557 | ||||
Decrease in income tax expense upon recognition of gross unrecognized tax benefits | $ | 9,932 | $ | 9,262 |
As of September 30 | As of December 31 | |||||||
Liabilities for Unrecognized Tax Benefits ($000) | 2014 | 2013 | ||||||
Current liability | $ | 4,075 | $ | 6,211 | ||||
Non-current liability | 7,085 | 6,012 | ||||||
Total liability for unrecognized tax benefits | $ | 11,160 | $ | 12,223 |
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