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Segment Reporting | 12 Months Ended
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Dec. 31, 2019
Segment Reporting [Abstract] |
SEGMENT REPORTING | SEGMENT REPORTING Ryder is a global leader in transportation and supply chain management solutions. Our operating segments are aggregated into reportable business segments based upon similar economic characteristics, products, services, customers and delivery methods. We report our financial performance based on three business segments: (1) FMS, which provides full service leasing and leasing with flexible maintenance options, commercial rental, and contract or transactional maintenance services of trucks, tractors and trailers to customers principally in the U.S., Canada and the U.K.; (2) SCS, which provides integrated logistics solutions, including distribution, management, dedicated transportation and professional services in North America; and (3) DTS, which provides turnkey transportation solutions in the U.S. that includes dedicated vehicles, drivers and engineering and administrative support. Dedicated transportation services provided as part of an operationally integrated, multi-service, supply chain solution to SCS customers are primarily reported in the SCS business segment. Our primary measurement of segment financial performance, defined as “Earnings from continuing operations before taxes” (EBT) from continuing operations, includes an allocation of Central Support Services (CSS) and excludes non-operating pension costs and certain other items as discussed in Note 5, "Restructuring and Other Items, Net" and Note 22, "Other Items Impacting Comparability." CSS represents those costs incurred to support all business segments, including finance and procurement, corporate services, human resources, information technology, public affairs, legal, marketing and corporate communications. The objective of the EBT measurement is to provide clarity on the profitability of each business segment and, ultimately, to hold leadership of each business segment accountable for their allocated share of CSS costs. Certain costs are not attributable to any segment and remain unallocated in CSS, including costs for investor relations, public affairs and certain executive compensation. CSS costs attributable to the business segments are predominantly allocated to FMS, SCS and DTS as follows:
• | Finance, corporate services, and health and safety — allocated based upon estimated and planned resource utilization;
• | Human resources — individual costs within this category are allocated under various methods, including allocation based on estimated utilization and number of personnel supported;
• | Information technology — principally allocated based upon utilization-related metrics such as number of users or minutes of CPU time. Customer-related project costs and expenses are allocated to the business segment responsible for the project; and
• | Other — represents legal and other centralized costs and expenses including certain share-based incentive compensation costs. Expenses, where allocated, are based primarily on the number of personnel supported.
Our FMS segment leases revenue earning equipment and provides fuel, maintenance and other ancillary services to the SCS and DTS segments. EBT related to inter-segment equipment and services billed to SCS and DTS customers (equipment contribution) are included in both FMS and the segment that served the customer and then eliminated upon consolidation (presented as “Eliminations”). Inter-segment EBT allocated to SCS and DTS includes earnings related to equipment used in providing services to SCS and DTS customers. Segment results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented. Each business segment follows the same accounting policies as described in Note 1, “Summary of Significant Accounting Policies.” However, we do not record right-of-use assets or liabilities for our intercompany operating leases between FMS and SCS and DTS business segments. The following tables set forth financial information for each of our segments and provide a reconciliation between segment EBT and earnings from continuing operations before income taxes. Prior period segment amounts have been revised to reflect the adoption of the new leasing standard (refer to Note 2 for further information).
|  | Years ended December 31,
|  | 2019 |  | 2018 |  | 2017
|  | (In thousands)
Revenue: |  |  |  |  |  |
Fleet Management Solutions: |  |  |  |  |  |
ChoiceLease |  | $ | 3,112,311 |  |  | $ | 2,860,266 |  |  | $ | 2,671,687 |
Commercial rental |  | 1,009,086 |  |  | 960,606 |  |  | 813,539 |
SelectCare |  | 541,358 |  |  | 502,835 |  |  | 464,056 |
Other |  | 92,286 |  |  | 87,331 |  |  | 77,450 |
Fuel services revenue |  | 816,362 |  |  | 847,655 |  |  | 689,809 |
Fleet Management Solutions |  | 5,571,403 |  |  | 5,258,693 |  |  | 4,716,541 |
Supply Chain Solutions |  | 2,551,271 |  |  | 2,398,144 |  |  | 1,937,352 |
Dedicated Transportation Solutions |  | 1,417,483 |  |  | 1,333,313 |  |  | 1,095,645 |
Eliminations |  | (614,356 | ) |  | (576,204 | ) |  | (469,464 | )
Total revenue |  | $ | 8,925,801 |  |  | $ | 8,413,946 |  |  | $ | 7,280,074 |
Earnings (Loss) Before Taxes: |  |  |  |  |  |
Fleet Management Solutions |  | $ | (70,274 | ) |  | $ | 340,038 |  |  | $ | 295,618 |
Supply Chain Solutions |  | 145,060 |  |  | 130,262 |  |  | 98,825 |
Dedicated Transportation Solutions |  | 81,149 |  |  | 61,236 |  |  | 55,346 |
Eliminations |  | (50,732 | ) |  | (63,593 | ) |  | (53,273 | )
|  | 105,203 |  |  | 467,943 |  |  | 396,516 |
Unallocated Central Support Services |  | (49,114 | ) |  | (49,081 | ) |  | (48,259 | )
Non-operating pension costs (1) |  | (60,406 | ) |  | (7,541 | ) |  | (27,741 | )
Other items impacting comparability, net (2) |  | (37,954 | ) |  | (21,852 | ) |  | (24,080 | )
Earnings (loss) from continuing operations before income taxes |  | $ | (42,271 | ) |  | $ | 389,469 |  |  | $ | 296,436 |
______________
(1) | Non-operating pension costs include the amortization of net actuarial loss and prior service costs, interest cost and expected return on plan assets
components of pension and postretirement benefit costs and pension settlement charges. Refer to Note 20, "Employee Benefit Plans," for a discussion on these items.
(2) | Refer to Note 22, “Other Items Impacting Comparability,” for a discussion of items excluded from our primary measure of segment performance.
The following table sets forth depreciation expense, amortization expense and other non-cash charges, net, interest expense (income), capital expenditures paid and total assets for the years ended December 31, 2019, 2018 and 2017, as provided to the chief operating decision-maker for each of our reportable business segments:
|  | FMS |  | SCS |  | DTS |  | CSS |  | Eliminations |  | Total
|  | (In thousands)
2019 |  |  |  |  |  |  |  |  |  |  |  |
Depreciation expense (1) |  | $ | 1,825,816 |  |  | 42,428 |  |  | 3,795 |  |  | 6,890 |  |  | — |  |  | $ | 1,878,929 |
Amortization expense and other non-cash charges, net |  | $ | 126,224 |  |  | 55,658 |  |  | 1,427 |  |  | 3,815 |  |  | — |  |  | $ | 187,124 |
Interest expense (income) (2) |  | $ | 243,406 |  |  | 1,038 |  |  | (3,224 | ) |  | 161 |  |  | — |  |  | $ | 241,381 |
Capital expenditures paid |  | $ | 3,643,573 |  |  | 49,421 |  |  | 2,182 |  |  | 39,998 |  |  | — |  |  | $ | 3,735,174 |
Total assets |  | $ | 12,991,716 |  |  | 1,236,589 |  |  | 327,384 |  |  | 305,631 |  |  | (385,986 | ) |  | $ | 14,475,334 |
2018 |  |  |  |  |  |  |  |  |  |  |  |
Depreciation expense (1) |  | $ | 1,346,484 |  |  | 34,631 |  |  | 4,773 |  |  | 2,682 |  |  | — |  |  | $ | 1,388,570 |
Amortization expense and other non-cash charges, net |  | $ | 81,041 |  |  | 65,443 |  |  | 1,469 |  |  | 1,053 |  |  | — |  |  | $ | 149,006 |
Interest expense (income) (2) |  | $ | 181,335 |  |  | 1,171 |  |  | (2,262 | ) |  | 244 |  |  | — |  |  | $ | 180,488 |
Capital expenditures paid |  | $ | 2,979,482 |  |  | 45,348 |  |  | 1,444 |  |  | 24,135 |  |  | — |  |  | $ | 3,050,409 |
Total assets |  | $ | 11,854,454 |  |  | 1,123,864 |  |  | 324,906 |  |  | 404,999 |  |  | (360,415 | ) |  | $ | 13,347,808 |
2017 |  |  |  |  |  |  |  |  |  |  |  |
Depreciation expense (1) |  | $ | 1,218,897 |  |  | 32,245 |  |  | 3,513 |  |  | 3,026 |  |  | — |  |  | $ | 1,257,681 |
Amortization expense and other non-cash charges, net |  | $ | 79,252 |  |  | 28,032 |  |  | 1,801 |  |  | (263 | ) |  | — |  |  | $ | 108,822 |
Interest expense (income) (2) |  | $ | 145,400 |  |  | (2,398 | ) |  | (1,659 | ) |  | 533 |  |  | — |  |  | $ | 141,876 |
Capital expenditures paid |  | $ | 1,783,917 |  |  | 50,117 |  |  | 3,375 |  |  | 23,027 |  |  | — |  |  | $ | 1,860,436 |
Total assets |  | $ | 10,528,482 |  |  | 907,627 |  |  | 278,863 |  |  | 280,371 |  |  | (269,614 | ) |  | $ | 11,725,729 |
____________
(1) | Depreciation expense totaling $27 million, $25 million and $24 million during 2019, 2018 and 2017, respectively, associated with CSS assets was allocated to business segments based upon estimated and planned asset utilization.
(2) | Interest expense was primarily allocated to the FMS segment since such borrowings were used principally to fund the purchase of revenue earning equipment used in FMS; however, interest income was also reflected in SCS and DTS based on targeted segment leverage ratios.
Geographic Information
|  | Years ended December 31,
|  | 2019 |  | 2018
|  | (In thousands)
Long-lived assets: |  |  |  |
United States |  | $ | 10,106,520 |  |  | $ | 9,125,278 |
Foreign: |  |  |  |
Canada |  | 737,037 |  |  | 651,424 |
Europe |  | 439,772 |  |  | 444,468 |
Mexico |  | 62,134 |  |  | 56,608 |
Singapore |  | — |  |  | 237 |
|  | 1,238,943 |  |  | 1,152,737 |
Total |  | $ | 11,345,463 |  |  | $ | 10,278,015 |

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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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