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Segments | 6 Months Ended
--- | ---
Jun. 30, 2014
Segment Reporting [Abstract] |
SEGMENTS | SEGMENTS The segment reporting structure uses the Company’s management reporting structure as its foundation to reflect how the Company manages the business internally and is organized by geographic regions which provide better socio-political-economic understanding of our business. The management reporting structure is organized along six strategic business units (“SBUs”) — led by our Chief Executive Officer (“CEO”). Using the accounting guidance on segment reporting, the Company has determined that it has six reportable segments corresponding to its six SBUs:
• | US SBU;
• | Andes SBU;
• | Brazil SBU;
• | MCAC SBU;
• | EMEA SBU; and
• | Asia SBU
Corporate and Other — Silver Ridge Power (formerly AES Solar Holding Company) and certain other unconsolidated businesses are accounted for using the equity method of accounting; therefore, their operating results are included in “Net Equity in Earnings of Affiliates” on the face of the Condensed Consolidated Statements of Operations, not in revenue. “Corporate and Other” also includes corporate overhead costs which are not directly associated with the operations of our six reportable segments and other intercompany charges such as self-insurance premiums which are fully eliminated in consolidation. The Company uses Adjusted PTC as its primary segment performance measure. Adjusted PTC, a non-GAAP measure, is defined by the Company as pretax income from continuing operations attributable to AES excluding unrealized gains or losses related to derivative transactions, unrealized foreign currency gains or losses, gains or losses due to dispositions and acquisitions of business interests, losses due to impairments and costs due to the early retirement of debt. The Company has concluded that Adjusted PTC best reflects the underlying business performance of the Company and is the most relevant measure considered in the Company’s internal evaluation of the financial performance of its segments. Additionally, given its large number of businesses and complexity, the Company concluded that Adjusted PTC is a more transparent measure that better assists the investors in determining which businesses have the greatest impact on the overall Company results. Corporate allocations include certain self-insurance activities which are reflected within segment Adjusted PTC. All intra-segment activity has been eliminated with respect to revenue and Adjusted PTC within the segment. Inter-segment activity has been eliminated within the total consolidated results. Asset information for businesses that were discontinued or classified as held-for-sale as of June 30, 2014 is segregated and is shown in the line “Discontinued businesses” in the accompanying segment tables. Information about the Company’s operations by segment for the periods indicated was as follows:
Revenue |  | Total Revenue |  | Intersegment |  | External Revenue
Three Months Ended June 30, | 2014 |  | 2013 |  | 2014 |  | 2013 |  | 2014 |  | 2013
|  | (in millions)
US SBU |  | $ | 893 |  |  | $ | 858 |  |  | $ | — |  |  | $ | — |  |  | $ | 893 |  |  | $ | 858 |
Andes SBU |  | 724 |  |  | 725 |  |  | (1 | ) |  | — |  |  | 723 |  |  | 725 |
Brazil SBU |  | 1,533 |  |  | 1,230 |  |  | — |  |  | — |  |  | 1,533 |  |  | 1,230 |
MCAC SBU |  | 692 |  |  | 694 |  |  | — |  |  | — |  |  | 692 |  |  | 694 |
EMEA SBU |  | 305 |  |  | 295 |  |  | — |  |  | — |  |  | 305 |  |  | 295 |
Asia SBU |  | 163 |  |  | 142 |  |  | — |  |  | — |  |  | 163 |  |  | 142 |
Corporate and Other |  | 5 |  |  | 3 |  |  | (3 | ) |  | (2 | ) |  | 2 |  |  | 1 |
Total Revenue |  | $ | 4,315 |  |  | $ | 3,947 |  |  | $ | (4 | ) |  | $ | (2 | ) |  | $ | 4,311 |  |  | $ | 3,945 |
Revenue |  | Total Revenue |  | Intersegment |  | External Revenue
Six Months Ended June 30, | 2014 |  | 2013 |  | 2014 |  | 2013 |  | 2014 |  | 2013
|  | (in millions)
US SBU |  | $ | 1,894 |  |  | $ | 1,744 |  |  | $ | — |  |  | $ | — |  |  | $ | 1,894 |  |  | $ | 1,744 |
Andes SBU |  | 1,344 |  |  | 1,415 |  |  | (1 | ) |  | — |  |  | 1,343 |  |  | 1,415 |
Brazil SBU |  | 2,978 |  |  | 2,659 |  |  | — |  |  | — |  |  | 2,978 |  |  | 2,659 |
MCAC SBU |  | 1,330 |  |  | 1,363 |  |  | (1 | ) |  | — |  |  | 1,329 |  |  | 1,363 |
EMEA SBU |  | 696 |  |  | 638 |  |  | — |  |  | — |  |  | 696 |  |  | 638 |
Asia SBU |  | 331 |  |  | 275 |  |  | — |  |  | — |  |  | 331 |  |  | 275 |
Corporate and Other |  | 7 |  |  | 4 |  |  | (5 | ) |  | (3 | ) |  | 2 |  |  | 1 |
Total Revenue |  | $ | 8,580 |  |  | $ | 8,098 |  |  | $ | (7 | ) |  | $ | (3 | ) |  | $ | 8,573 |  |  | $ | 8,095 |
|  | Total Adjusted Pretax Contribution |  | Intersegment |  | External Adjusted Pretax Contribution
Adjusted Pretax Contribution (1)
Three Months Ended June 30, | 2014 |  | 2013 |  | 2014 |  | 2013 |  | 2014 |  | 2013
|  | (in millions)
US SBU |  | $ | 80 |  |  | $ | 63 |  |  | $ | 3 |  |  | $ | 3 |  |  | $ | 83 |  |  | $ | 66 |
Andes SBU |  | 104 |  |  | 88 |  |  | 1 |  |  | 4 |  |  | 105 |  |  | 92 |
Brazil SBU |  | 115 |  |  | 78 |  |  | — |  |  | — |  |  | 115 |  |  | 78 |
MCAC SBU |  | 95 |  |  | 104 |  |  | 10 |  |  | 4 |  |  | 105 |  |  | 108 |
EMEA SBU |  | 73 |  |  | 72 |  |  | 3 |  |  | 2 |  |  | 76 |  |  | 74 |
Asia SBU |  | 23 |  |  | 40 |  |  | — |  |  | — |  |  | 23 |  |  | 40 |
Corporate and Other |  | (150 | ) |  | (156 | ) |  | (17 | ) |  | (13 | ) |  | (167 | ) |  | (169 | )
Total Adjusted Pretax Contribution |  | $ | 340 |  |  | $ | 289 |  |  | $ | — |  |  | $ | — |  |  | $ | 340 |  |  | $ | 289 |
Reconciliation to Income from Continuing Operations before Taxes and Equity Earnings of Affiliates:
Non-GAAP Adjustments: |  |  |  |
Unrealized derivative gains (losses) |  | 22 |  |  | 53 |
Unrealized foreign currency gains (losses) |  | (7 | ) |  | (23 | )
Disposition/acquisition gains (losses) |  | (2 | ) |  | 23 |
Impairment losses |  | (99 | ) |  | — |
Loss on extinguishment of debt |  | (13 | ) |  | (164 | )
Pretax contribution |  | 241 |  |  | 178 |
Add: income from continuing operations before taxes, attributable to noncontrolling interests |  | 197 |  |  | 231 |
Less: Net equity in earnings of affiliates |  | 20 |  |  | 2 |
Income from continuing operations before taxes and equity in earnings of affiliates |  | $ | 418 |  |  | $ | 407 |
|  | Total Adjusted Pretax Contribution |  | Intersegment |  | External Adjusted Pretax Contribution
Adjusted Pretax Contribution (1)
Six Months Ended June 30, | 2014 |  | 2013 |  | 2014 |  | 2013 |  | 2014 |  | 2013
|  | (in millions)
US SBU |  | $ | 155 |  |  | $ | 196 |  |  | $ | 6 |  |  | $ | 5 |  |  | $ | 161 |  |  | $ | 201 |
Andes SBU |  | 157 |  |  | 169 |  |  | 4 |  |  | 7 |  |  | 161 |  |  | 176 |
Brazil SBU |  | 184 |  |  | 120 |  |  | 1 |  |  | 1 |  |  | 185 |  |  | 121 |
MCAC SBU |  | 160 |  |  | 160 |  |  | 14 |  |  | 7 |  |  | 174 |  |  | 167 |
EMEA SBU |  | 188 |  |  | 168 |  |  | 6 |  |  | 5 |  |  | 194 |  |  | 173 |
Asia SBU |  | 31 |  |  | 71 |  |  | 1 |  |  | 1 |  |  | 32 |  |  | 72 |
Corporate and Other |  | (292 | ) |  | (325 | ) |  | (32 | ) |  | (26 | ) |  | (324 | ) |  | (351 | )
Total Adjusted Pretax Contribution |  | $ | 583 |  |  | $ | 559 |  |  | $ | — |  |  | $ | — |  |  | $ | 583 |  |  | $ | 559 |
Reconciliation to Income from Continuing Operations before Taxes and Equity Earnings of Affiliates:
Non-GAAP Adjustments: |  |  |  |
Unrealized derivative gains (losses) |  | 32 |  |  | 39 |
Unrealized foreign currency gains (losses) |  | (33 | ) |  | (49 | )
Disposition/acquisition gains (losses) |  | (1 | ) |  | 26 |
Impairment losses |  | (265 | ) |  | (48 | )
Loss on extinguishment of debt |  | (147 | ) |  | (207 | )
Pretax contribution |  | 169 |  |  | 320 |
Add: income from continuing operations before taxes, attributable to noncontrolling interests |  | 412 |  |  | 403 |
Less: Net equity in earnings of affiliates |  | 45 |  |  | 6 |
Income from continuing operations before taxes and equity in earnings of affiliates |  | $ | 536 |  |  | $ | 717 |
_____________________________
(1) | Adjusted pretax contribution in each segment before intersegment eliminations includes the effect of intercompany transactions with other segments except for interest, charges for certain management fees and the write-off of intercompany balances.
Assets by segment as of the periods indicated were as follows:
|  | Total Assets
|  | June 30, 2014 |  | December 31, 2013
Assets |  | (in millions)
US SBU |  | $ | 9,835 |  |  | $ | 9,952 |
Andes SBU |  | 7,458 |  |  | 7,356 |
Brazil SBU |  | 9,144 |  |  | 8,388 |
MCAC SBU |  | 5,060 |  |  | 5,075 |
EMEA SBU |  | 4,240 |  |  | 4,191 |
Asia SBU |  | 2,953 |  |  | 2,810 |
Discontinued businesses |  | — |  |  | 1,718 |
Corporate and Other & eliminations |  | 743 |  |  | 921 |
Total Assets |  | $ | 39,433 |  |  | $ | 40,411 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8864-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8933-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8844-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8538-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8981-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8984-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8906-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8924-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9031-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8971-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e8595-108599 + Details
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