Segment Information

6 Months Ended

Jun. 30, 2019

We are organized into six geographic operating segments based on management responsibilities. The operating segments have been aggregated (based on economic similarities, the nature of their products, end-user markets and methods of distribution) into three reportable segments: Americas, International, and Corporate.

The Americas segment is comprised of our operations in North America and Latin America geographies. The International segment is comprised of our operations of all geographies outside of the Americas. Certain global expenses are allocated to each segment in a manner consistent with where the benefits from the expenses are derived.

The Company's sales are allocated to each country based primarily on the destination of the end-customer.

Adjusted operating income (loss), adjusted operating margin, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) and adjusted EBITDA margin are the measures used by the chief operating decision maker to evaluate segment performance and allocate resources. Adjusted operating income (loss) is defined as operating income excluding restructuring charges, currency exchange gains/losses, product liability expense and strategic transaction costs and adjusted operating margin is defined as adjusted operating income (loss) divided by segment sales to external customers. Adjusted EBITDA is defined as adjusted operating income (loss) plus depreciation and amortization and adjusted EBITDA margin is defined as adjusted EBITDA divided by segment sales to external customers. Adjusted operating income (loss), adjusted operating margin, adjusted EBITDA and adjusted EBITDA margin are not recognized terms under U.S. GAAP and therefore do not purport to be alternatives to operating income or operating margin as a measure of operating performance. Further, the Company's measure of adjusted operating income (loss), adjusted operating margin, adjusted EBITDA and adjusted EBITDA margin may not be comparable to similarly titled measures of other companies. Adjusted operating income (loss) and adjusted EBITDA on a consolidated basis is presented in the following table to reconcile the segment operating performance measure to operating income as presented on the unaudited Condensed Consolidated Statement of Income.

The accounting principles applied at the operating segment level in determining operating income (loss) are generally the same as those applied at the consolidated financial statement level. Sales and transfers between operating segments are accounted for at market-based transaction prices and are eliminated in consolidation.

Reportable segment information is presented in the following table:



(In thousands, except percentage amounts)	Americas			International			Corporate			Reconciling Items₁			Consolidated Totals
Three Months Ended June 30, 2019
Sales to external customers	$	231,389		$	118,286		$	—		$	—		$	349,675
Intercompany sales	148,776			77,454			—			(226,230		)	—
Operating income													54,478
Restructuring charges (Note 4)													3,522
Currency exchange losses, net (Note 6)													1,290
Product liability expense (Note 18)													3,529
Strategic transaction costs (Note 19)													1,529
Adjusted operating income (loss)	57,689			15,072			(8,413		)	—			64,348
Adjusted operating margin %	24.9		%	12.7		%
Depreciation and amortization													9,466
Adjusted EBITDA	63,842			18,288			(8,316		)	—			73,814
Adjusted EBITDA %	27.6		%	15.5		%
Six Months Ended June 30, 2019
Sales to external customers	$	445,076		$	230,637		$	—		$	—		$	675,713
Intercompany sales	308,038			156,783			—			(464,821		)	—
Operating income													86,638
Restructuring charges (Note 4)													9,353
Currency exchange losses, net (Note 6)													18,251
Product liability expense (Note 18)													6,425
Strategic transaction costs (Note 19)													1,985
Adjusted operating income (loss)	112,492			26,112			(15,952		)	—			122,652
Adjusted operating margin %	25.3		%	11.3		%
Depreciation and amortization													18,792
Adjusted EBITDA	124,742			32,459			(15,757		)	—			141,444
Adjusted EBITDA %	28.0		%	14.1		%



(In thousands, except percentage amounts)	Americas			International			Corporate			Reconciling Items₁			Consolidated Totals
Three Months Ended June 30, 2018
Sales to external customers	$	215,339		$	123,992		$	—		$	—		$	339,331
Intercompany sales	36,445			84,514						(120,959		)	—
Operating income													46,797
Restructuring charges (Note 4)													2,335
Currency exchange losses, net (Note 6)													815
Product liability expense (Note 18)													8,018
Strategic transaction costs (Note 19)													58
Adjusted operating income (loss)	49,838			15,853			(7,668		)	—			58,023
Adjusted operating margin %	23.1		%	12.8		%
Depreciation and amortization													9,536
Adjusted EBITDA	55,894			19,233			(7,568		)				67,559
Adjusted EBITDA %	26.0		%	15.5		%
Six Months Ended June 30, 2018
Sales to external customers	$	424,468		$	240,757		$	—		$	—		$	665,225
Intercompany sales	70,643			166,893			—			(237,536		)	—
Operating income													91,232
Restructuring charges (Note 4)													7,609
Currency exchange losses, net (Note 6)													2,823
Product liability expense (Note 18)													10,842
Strategic transaction costs													152
Adjusted operating income (loss)	99,924			28,631			(15,897		)	—			112,658
Adjusted operating margin %	23.5		%	11.9		%
Depreciation and amortization													19,207
Adjusted EBITDA	112,119			35,441			(15,695		)				131,865
Adjusted EBITDA %	26.4		%	14.7		%

₁Reconciling items consist primarily of intercompany eliminations and items not directly attributable to reporting segments.

Total sales by product group was as follows:



Three Months Ended June 30, 2019	Consolidated			Americas			International
(In thousands, except percentages)	Dollars		Percent	Dollars		Percent	Dollars		Percent
Breathing Apparatus	$	74,907	22%	$	50,584	22%	$	24,323	21%
Fixed Gas & Flame Detection	70,310		20%	39,118		17%	31,192		26%
Firefighter Helmets & Protective Apparel	48,799		14%	39,091		17%	9,708		8%
Portable Gas Detection	42,343		12%	33,844		13%	8,499		7%
Industrial Head Protection	38,921		11%	25,045		12%	13,876		12%
Fall Protection	31,629		9%	18,720		8%	12,909		11%
Other	42,766		12%	24,987		11%	17,779		15%
Total	$	349,675	100%	$	231,389	100%	$	118,286	100%

Six Months Ended June 30, 2019	Consolidated			Americas			International
(In thousands, except percentages)	Dollars		Percent	Dollars		Percent	Dollars		Percent
Breathing Apparatus	$	150,354	22%	$	101,489	23%	$	48,865	21%
Fixed Gas & Flame Detection	130,709		19%	72,048		16%	58,661		25%
Firefighter Helmets & Protective Apparel	92,376		14%	74,155		17%	18,221		8%
Portable Gas Detection	83,069		12%	55,458		12%	27,611		12%
Industrial Head Protection	74,665		12%	58,258		13%	16,407		7%
Fall Protection	61,756		9%	36,680		8%	25,076		11%
Other	82,784		12%	46,988		11%	35,796		16%
Total	$	675,713	100%	$	445,076	100%	$	230,637	100%



Three Months Ended June 30, 2018	Consolidated			Americas			International
(In thousands, except percentages)	Dollars		Percent	Dollars		Percent	Dollars		Percent
Breathing Apparatus	$	75,283	22%	$	46,678	22%	$	28,605	23%
Fixed Gas & Flame Detection	63,599		19%	33,128		15%	30,471		25%
Firefighter Helmets & Protective Apparel	46,676		14%	37,779		18%	8,897		7%
Portable Gas Detection	41,307		12%	27,137		13%	14,170		11%
Industrial Head Protection	39,639		12%	31,151		14%	8,488		7%
Fall Protection	26,052		8%	15,094		7%	10,958		9%
Other	46,775		13%	24,372		11%	22,403		18%
Total	$	339,331	100%	$	215,339	100%	$	123,992	100%

Six Months Ended June 30, 2018	Consolidated			Americas			International
(In thousands, except percentages)	Dollars		Percent	Dollars		Percent	Dollars		Percent
Breathing Apparatus	$	149,901	23%	$	96,012	23%	$	53,889	22%
Fixed Gas & Flame Detection	124,530		19%	65,654		15%	58,876		24%
Firefighter Helmets & Protective Apparel	91,159		14%	72,533		17%	18,626		8%
Portable Gas Detection	83,534		13%	55,899		13%	27,635		11%
Industrial Head Protection	74,594		11%	58,992		14%	15,602		6%
Fall Protection	51,757		8%	29,203		7%	22,554		9%
Other	89,750		12%	46,175		11%	43,575		20%
Total	$	665,225	100%	$	424,468	100%	$	240,757	100%