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Segment Information
 12 Months Ended
Sep. 30, 2016
Segment Information  
Segment Information

Note 20.  Segment information

Woodward serves the aerospace, industrial and energy markets through its two reportable segments - Aerospace and Industrial.  Woodward’s reportable segments are aggregations of Woodward’s operating segments.  Woodward uses operating segment information internally to manage its business, including the assessment of operating segment performance and decisions for the allocation of resources between operating segments.

In the first quarter of fiscal year 2016, Woodward changed the name of its Energy segment to Industrial.  The term “energy” is largely viewed as “oil and gas” and therefore was not representative of the broader markets Woodward serves in this segment.

The accounting policies of the reportable segments are the same as those of the Company.  Woodward evaluates segment profit or loss based on internal performance measures for each segment in a given period.  In connection with that assessment, Woodward excludes matters such as certain charges for restructuring costs, interest income and expense, certain gains and losses from asset dispositions, or other non-recurring and/or non-operationally related expenses. 

A summary of consolidated net sales and earnings by segment follows:







 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 



Year Ended September 30,



2016

 

2015

 

2014

Segment external net sales:

 

 

 

 

 

 

 

 

Aerospace

$

 1,233,176 

 

$

 1,160,883 

 

$

 1,084,025 

Industrial

 

 789,902 

 

 

 877,420 

 

 

 917,215 

Total consolidated net sales

$

 2,023,078 

 

$

 2,038,303 

 

$

 2,001,240 

Segment earnings:

 

 

 

 

 

 

 

 

Aerospace

$

 232,166 

 

$

 187,747 

 

$

 159,200 

Industrial

 

 82,237 

 

 

 126,641 

 

 

 134,278 

Total segment earnings

 

 314,403 

 

 

 314,388 

 

 

 293,478 

Nonsegment expenses

 

 (63,166)

 

 

 (49,362)

 

 

 (43,701)

Interest expense, net

 

 (24,751)

 

 

 (24,077)

 

 

 (22,533)

Consolidated earnings before income taxes

$

 226,486 

 

$

 240,949 

 

$

 227,244 



 

 

 

 

 

 

 

 

Segment assets consist of accounts receivable, inventories, property, plant, and equipment, net, goodwill, and other intangibles, net.  A summary of consolidated total assets, consolidated depreciation and amortization and consolidated capital expenditures follows:







 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 



Year Ended September 30,



2016

 

2015

 

2014

Segment assets:

 

 

 

 

 

 

 

 

Aerospace

$

 1,637,522 

 

$

 1,566,421 

 

$

 1,440,355 

Industrial

 

 705,169 

 

 

 653,848 

 

 

 610,345 

Total segment assets

 

 2,342,691 

 

 

 2,220,269 

 

 

 2,050,700 

Unallocated corporate property, plant and equipment, net

 

 89,988 

 

 

 85,834 

 

 

 72,992 

Other unallocated assets

 

 209,683 

 

 

 206,301 

 

 

 234,911 

Consolidated total assets

$

 2,642,362 

 

$

 2,512,404 

 

$

 2,358,603 



 

 

 

 

 

 

 

 

Segment depreciation and amortization:

 

 

 

 

 

 

 

 

Aerospace

$

 40,825 

 

$

 46,488 

 

$

 46,895 

Industrial

 

 20,412 

 

 

 20,768 

 

 

 22,672 

Total segment depreciation and amortization

 

 61,237 

 

 

 67,256 

 

 

 69,567 

Unallocated corporate amounts

 

 7,799 

 

 

 7,979 

 

 

 7,786 

Consolidated depreciation and amortization

$

 69,036 

 

$

 75,235 

 

$

 77,353 



 

 

 

 

 

 

 

 

Segment capital expenditures:

 

 

 

 

 

 

 

 

Aerospace

$

 90,749 

 

$

 150,021 

 

$

 134,307 

Industrial

 

 62,065 

 

 

 113,292 

 

 

 55,780 

Total segment capital expenditures

 

 152,814 

 

 

 263,313 

 

 

 190,087 

Unallocated corporate amounts

 

 22,878 

 

 

 23,299 

 

 

 17,019 

Consolidated capital expenditures

$

 175,692 

 

$

 286,612 

 

$

 207,106 

Sales to General Electric were made by both of Woodward’s reportable segments and totaled approximately 17% of net sales in fiscal year 2016, 18% of net sales in fiscal year 2015, and 15% of net sales in fiscal year 2014.  Accounts receivable from General Electric totaled approximately 14% of accounts receivable at September 30, 2016 and 15% of accounts receivable at September 30, 2015.

U.S. Government related sales from Woodward’s reportable segments were as follows:





 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 



Direct U.S. Government Sales

 

Indirect U.S. Government Sales

 

Total U.S. Government Related Sales

Year ended September 30, 2016

 

 

 

 

 

 

 

 

Aerospace

$

 103,026 

 

$

 310,952 

 

$

 413,978 

Industrial

 

 6,550 

 

 

 9,845 

 

 

 16,395 

Total net external sales

$

 109,576 

 

$

 320,797 

 

$

 430,373 

Percentage of total net sales

 

 5% 

 

 

 16% 

 

 

 21% 



 

 

 

 

 

 

 

 

Year ended September 30, 2015

 

 

 

 

 

 

 

 

Aerospace

$

 92,322 

 

$

 258,391 

 

$

 350,713 

Industrial

 

 4,836 

 

 

 8,839 

 

 

 13,675 

Total net external sales

$

 97,158 

 

$

 267,230 

 

$

 364,388 

Percentage of total net sales

 

 5% 

 

 

 13% 

 

 

 18% 



 

 

 

 

 

 

 

 

Year ended September 30, 2014

 

 

 

 

 

 

 

 

Aerospace

$

 76,982 

 

$

 254,806 

 

$

 331,788 

Industrial

 

 2,517 

 

 

 5,588 

 

 

 8,105 

Total net external sales

$

 79,499 

 

$

 260,394 

 

$

 339,893 

Percentage of total net sales

 

 4% 

 

 

 13% 

 

 

 17% 



 

 

 

 

 

 

 

 

Accounts receivable from the U.S. Government totaled approximately 2% of accounts receivable at September 30, 2016 and 3% of accounts receivable at September 30, 2015.

The customers who account for approximately 10% or more of sales to each of Woodward’s reportable segments for the fiscal year ended September 30, 2016 follow:







 

 



 

 



 

Customer

Aerospace

 

Boeing, United Technologies

Industrial

 

General Electric

Net sales by geographical area, as determined by the location of the customer invoiced, were as follows:





 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 



Year Ended September 30,



2016

 

2015

 

2014

United States

$

 1,118,833 

 

$

 1,054,895 

 

$

 1,025,149 

Europe (1)

 

 537,901 

 

 

 569,322 

 

 

 519,721 

Asia

 

 228,683 

 

 

 241,875 

 

 

 299,755 

Other countries

 

 137,661 

 

 

 172,211 

 

 

 156,615 

Consolidated net sales

$

 2,023,078 

 

$

 2,038,303 

 

$

 2,001,240 



 

 

 

 

 

 

 

 

(1)

As a percentage of consolidated net sales, net sales to customers in Germany accounted for 10% for the year ended September 30, 2016, 10% for the year ended September 30, 2015 and 9% for the year ended September 30, 2014.

Property, plant, and equipment, net by geographical area, as determined by the physical location of the assets, were as follows:













 

 

 

 

 



 

 

 

 

 



At September 30,



2016

 

2015

United States

$

 826,225 

 

$

 704,686 

Germany

 

 24,468 

 

 

 25,634 

Other countries

 

 25,657 

 

 

 25,780 

Consolidated property, plant and equipment, net

$

 876,350 

 

$

 756,100