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Reportable Segments | 9 Months Ended
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Sep. 30, 2019
Segment Reporting [Abstract] |
Reportable Segments | Reportable Segments As reported in our Annual Report on Form 10-K for the year ended December 31, 2018, the structure of our internal organization was divided into the following reportable segments, which were also our operating segments: Energy & Chemicals (“E&C”), Distribution and Storage Western Hemisphere (“D&S West”) and Distribution and Storage Eastern Hemisphere (“D&S East”). Corporate includes operating expenses for executive management, accounting, tax, treasury, corporate development, human resources, information technology, investor relations, legal, internal audit, and risk management. Corporate support functions are not currently allocated to the segments. Upon closing of our acquisition of AXC (see Note 10, “Business Combinations” for more information), effective July 1, 2019, we changed our reportable segments from three segments to four segments: (i) D&S East, (ii) D&S West, (iii) Energy & Chemicals Cryogenics (“E&C Cryogenics”), and (iv) Energy & Chemicals FinFans (“E&C FinFans”). AXC was combined with Chart’s Hudson Products business and Chart Cooler Services businesses from the prior E&C segment to create a new segment called E&C FinFans. The E&C FinFans segment is focused on our unique and broad product offering and capabilities in air cooled heat exchangers (“ACHX”) and fans. E&C Cryogenics supplies mission critical engineered equipment and systems used in the separation, liquefaction, and purification of hydrocarbon and industrial gases that span gas-to-liquid applications. All prior period amounts presented in the tables below have been reclassified based on our current reportable segments. The following table represents information for our reportable segments and our corporate function:
| Three Months Ended September 30, 2019
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Corporate |  | Consolidated
Sales to external customers (1) (2) | $ | 48.9 |  |  | $ | 128.6 |  |  | $ | 114.9 |  |  | $ | 70.4 |  |  | $ | (5.0 | ) |  | $ | — |  |  | $ | 357.8 |
Depreciation and amortization expense | 2.0 |  |  | 15.1 |  |  | 2.9 |  |  | 3.7 |  |  | — |  |  | 0.4 |  |  | 24.1 |
Operating income (loss) (1) - (4) | 3.6 |  |  | 16.2 |  |  | 24.9 |  |  | 7.1 |  |  | (0.9 | ) |  | (21.0 | ) |  | 29.9 |
Capital expenditures | 0.9 |  |  | 1.0 |  |  | 2.4 |  |  | 3.8 |  |  | — |  |  | 3.5 |  |  | 11.6 |
| Three Months Ended September 30, 2018
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Corporate |  | Consolidated
Sales to external customers | $ | 35.6 |  |  | $ | 62.5 |  |  | $ | 119.0 |  |  | $ | 56.8 |  |  | $ | (1.7 | ) |  | $ | — |  |  | $ | 272.2 |
Depreciation and amortization expense | 2.5 |  |  | 4.0 |  |  | 2.8 |  |  | 2.5 |  |  | — |  |  | 0.3 |  |  | 12.1 |
Operating income (loss) (3) - (7) | 6.4 |  |  | 5.7 |  |  | 31.9 |  |  | 3.3 |  |  | (0.5 | ) |  | (15.3 | ) |  | 31.5 |
Capital expenditures | 2.9 |  |  | 0.9 |  |  | 1.3 |  |  | 2.5 |  |  | — |  |  | 0.8 |  |  | 8.4 |
| Nine Months Ended September 30, 2019
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Corporate |  | Consolidated
Sales to external customers (1) (2) | $ | 131.3 |  |  | $ | 272.0 |  |  | $ | 344.8 |  |  | $ | 216.8 |  |  | $ | (8.2 | ) |  | $ | — |  |  | $ | 956.7 |
Depreciation and amortization expense | 11.1 |  |  | 23.3 |  |  | 8.7 |  |  | 11.9 |  |  | — |  |  | 1.1 |  |  | 56.1 |
Operating income (loss) (1) - (6) | (7.1 | ) |  | 36.0 |  |  | 77.7 |  |  | 7.1 |  |  | (2.5 | ) |  | (51.4 | ) |  | 59.8 |
Capital expenditures | 4.0 |  |  | 1.9 |  |  | 6.2 |  |  | 9.7 |  |  | — |  |  | 4.9 |  |  | 26.7 |
| Nine Months Ended September 30, 2018
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Corporate |  | Consolidated
Sales to external customers | $ | 98.6 |  |  | $ | 190.2 |  |  | $ | 337.2 |  |  | $ | 174.3 |  |  | $ | (6.1 | ) |  | $ | — |  |  | $ | 794.2 |
Depreciation and amortization expense | 7.5 |  |  | 12.1 |  |  | 8.4 |  |  | 7.9 |  |  | — |  |  | 1.0 |  |  | 36.9 |
Operating income (loss) (3) (4) (6) (7) | 2.9 |  |  | 17.9 |  |  | 77.7 |  |  | 13.5 |  |  | (1.7 | ) |  | (44.5 | ) |  | 65.8 |
Capital expenditures | 9.9 |  |  | 2.0 |  |  | 4.7 |  |  | 6.0 |  |  | — |  |  | 3.8 |  |  | 26.4 |
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(1) | Includes sales and operating loss for AXC, included in the E&C FinFans segment results since the acquisition date, July 1, 2019 as follows:
• | Sales were $60.1 for both the three and nine months ended September 30, 2019.
• | Operating income was $2.6 for both the three and nine months ended September 30, 2019.
(2) | Includes sales and operating income (loss) for VRV S.r.l and its subsidiaries (“VRV”), included in the E&C Cryogenics and D&S East segment results since the acquisition date, November 15, 2018 as follows:
• | Sales were $25.9 (E&C Cryogenics: $13.5, D&S East: $12.4) for the three months ended September 30, 2019.
• | Sales were $77.0 (E&C Cryogenics: $35.0, D&S East: $42.0) for the nine months ended September 30, 2019.
• | Operating income (loss) was $2.4 (E&C Cryogenics: $2.6, D&S East: $(0.2)) for the three months ended September 30, 2019.
• | Operating loss was $(6.8) (E&C Cryogenics: $(3.0), D&S East: $(3.8)) for the nine months ended September 30, 2019, which includes VRV inventory step-up of $1.7.
(3) | Restructuring costs for the:
• | Three Months Ended September 30, 2019 were $1.5 ($0.2 E&C Cryogenics, $0.6 E&C FinFans, $0.4 D&S West, $0.3 D&S East).
• | Three Months Ended September 30, 2018 were $2.0 ($0.1 E&C FinFans, $0.1 D&S East, $1.8 Corporate).
• | Nine Months Ended September 30, 2019 were $13.3 ($2.4 E&C Cryogenics, $1.8 E&C FinFans, $0.8 D&S West, $8.1 D&S East, $0.2 Corporate).
• | Nine Months Ended September 30, 2018 were $3.5 ($0.4 E&C Cryogenics, $0.1 E&C FinFans, $0.6 D&S East, $2.4 Corporate).
(4) | Corporate includes transaction-related costs of: (transaction-related costs include costs associated with business development and other one-time transactions)
• | $4.3 and $2.0 for the three months ended September 30, 2019 and 2018, respectively, and
• | $7.0 and $4.1 for the nine months ended September 30, 2019 and 2018, respectively.
(5) | Includes $0.8 related to AXC integration activities during the third quarter of 2019 (E&C FinFans: $0.7, Corporate: $0.1), and $0.6 (D&S East: $0.2, Corporate: $0.4) and $1.8 (D&S East: $0.2, Corporate: $1.6) related to VRV integration activities for the three and nine months ended September 30, 2019, respectively.
(6) | Includes an expense of $3.8 recorded to cost of sales related to the estimated costs of the aluminum cryobiological tank recall for the nine months ended September 30, 2018.
(7) | Includes net severance costs of $0.9 related to headcount reductions associated with strategic realignment of our segment structure, which includes $1.8 in payroll severance costs partially offset by a $0.9 credit due to related share-based compensation forfeitures for the nine months ended September 30, 2018. Includes net severance costs of $1.4 related to the departure of our former CEO on June 11, 2018, which includes $3.2 in payroll severance costs partially offset by a $1.8 credit due to share-based compensation forfeitures for the nine months ended September 30, 2018.
Product Sales Information
| Three Months Ended September 30, 2019
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Consolidated
Natural gas processing (including petrochemical) applications | $ | 17.6 |  |  | $ | 88.6 |  |  | $ | — |  |  | $ | 1.0 |  |  | $ | (1.5 | ) |  | $ | 105.7 |
Liquefied natural gas (LNG) applications | 17.3 |  |  | 11.0 |  |  | 16.1 |  |  | 10.2 |  |  | (0.1 | ) |  | 54.5 |
Industrial gas applications | 6.7 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 6.7 |
HVAC, power and refining applications | 7.3 |  |  | 29.0 |  |  | — |  |  | — |  |  | (0.6 | ) |  | 35.7 |
Bulk industrial gas applications | — |  |  | — |  |  | 40.7 |  |  | 48.2 |  |  | (2.2 | ) |  | 86.7 |
Packaged gas industrial applications | — |  |  | — |  |  | 38.3 |  |  | 11.0 |  |  | (0.6 | ) |  | 48.7 |
Cryobiological storage | — |  |  | — |  |  | 19.8 |  |  | — |  |  | — |  |  | 19.8 |
Total | $ | 48.9 |  |  | $ | 128.6 |  |  | $ | 114.9 |  |  | $ | 70.4 |  |  | $ | (5.0 | ) |  | $ | 357.8 |
| Three Months Ended September 30, 2018
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Consolidated
Natural gas processing (including petrochemical) applications | $ | 17.2 |  |  | $ | 43.1 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 60.3 |
Liquefied natural gas (LNG) applications | 3.4 |  |  | 9.0 |  |  | 20.5 |  |  | 11.8 |  |  | (0.4 | ) |  | 44.3 |
Industrial gas applications | 3.3 |  |  | 3.3 |  |  | — |  |  | — |  |  | — |  |  | 6.6 |
HVAC, power and refining applications | 11.7 |  |  | 7.1 |  |  | — |  |  | — |  |  | — |  |  | 18.8 |
Bulk industrial gas applications | — |  |  | — |  |  | 41.1 |  |  | 31.8 |  |  | (0.4 | ) |  | 72.5 |
Packaged gas industrial applications | — |  |  | — |  |  | 37.2 |  |  | 13.2 |  |  | (0.9 | ) |  | 49.5 |
Cryobiological storage | — |  |  | — |  |  | 20.2 |  |  | — |  |  | — |  |  | 20.2 |
Total | $ | 35.6 |  |  | $ | 62.5 |  |  | $ | 119.0 |  |  | $ | 56.8 |  |  | $ | (1.7 | ) |  | $ | 272.2 |
| Nine Months Ended September 30, 2019
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Consolidated
Natural gas processing (including petrochemical) applications | $ | 64.1 |  |  | $ | 193.9 |  |  | $ | — |  |  | $ | 1.0 |  |  | $ | (1.5 | ) |  | $ | 257.5 |
Liquefied natural gas (LNG) applications | 26.5 |  |  | 32.2 |  |  | 58.2 |  |  | 38.6 |  |  | (0.1 | ) |  | 155.4 |
Industrial gas applications | 17.3 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 17.3 |
HVAC, power and refining applications | 23.4 |  |  | 45.9 |  |  | — |  |  | — |  |  | (0.6 | ) |  | 68.7 |
Bulk industrial gas applications | — |  |  | — |  |  | 114.2 |  |  | 136.3 |  |  | (3.0 | ) |  | 247.5 |
Packaged gas industrial applications | — |  |  | — |  |  | 109.8 |  |  | 40.9 |  |  | (3.0 | ) |  | 147.7 |
Cryobiological storage | — |  |  | — |  |  | 62.6 |  |  | — |  |  | — |  |  | 62.6 |
Total | $ | 131.3 |  |  | $ | 272.0 |  |  | $ | 344.8 |  |  | $ | 216.8 |  |  | $ | (8.2 | ) |  | $ | 956.7 |
| Nine Months Ended September 30, 2018
| E&C Cryogenics |  | E&C FinFans |  | D&S West |  | D&S East |  | Intersegment Eliminations |  | Consolidated
Natural gas processing (including petrochemical) applications | $ | 53.1 |  |  | $ | 134.9 |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 188.0 |
Liquefied natural gas (LNG) applications | 11.7 |  |  | 16.8 |  |  | 54.4 |  |  | 48.3 |  |  | (2.0 | ) |  | 129.2 |
Industrial gas applications | 13.0 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 13.0 |
HVAC, power and refining applications | 20.8 |  |  | 38.5 |  |  | — |  |  | — |  |  | — |  |  | 59.3 |
Bulk industrial gas applications | — |  |  | — |  |  | 105.7 |  |  | 85.8 |  |  | (1.2 | ) |  | 190.3 |
Packaged gas industrial applications | — |  |  | — |  |  | 117.8 |  |  | 40.2 |  |  | (2.9 | ) |  | 155.1 |
Cryobiological storage | — |  |  | — |  |  | 59.3 |  |  | — |  |  | — |  |  | 59.3 |
Total | $ | 98.6 |  |  | $ | 190.2 |  |  | $ | 337.2 |  |  | $ | 174.3 |  |  | $ | (6.1 | ) |  | $ | 794.2 |
Total Assets |  | September 30, 2019 |  | December 31, 2018
E&C Cryogenics |  | $ | 447.1 |  |  | $ | 455.0 |
E&C FinFans |  | 1,045.6 |  |  | 434.2 |
D&S West |  | 441.4 |  |  | 420.3 |
D&S East |  | 497.2 |  |  | 496.1 |
Corporate |  | 66.5 |  |  | 92.1 |
Total |  | $ | 2,497.8 |  |  | $ | 1,897.7 |

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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