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Reportable Segments and Geographic Information
 12 Months Ended
Dec. 31, 2012
Reportable Segments and Geographic Information  
Reportable Segments and Geographic Information

22.  Reportable Segments and Geographic Information

 

We manage our business segments primarily based upon the type of product or service provided. We have four reportable segments: North America contract operations, international contract operations, aftermarket services and fabrication. The North America and international contract operations segments primarily provide natural gas compression services, production and processing equipment services and maintenance services to meet specific customer requirements on Exterran-owned assets. The aftermarket services segment provides a full range of services to support the surface production, compression and processing needs of customers, from parts sales and normal maintenance services to full operation of a customer’s owned assets. The fabrication segment provides (i) design, engineering, fabrication, installation and sale of natural gas compression units and accessories and equipment used in the production, treating and processing of crude oil and natural gas and (ii) engineering, procurement and fabrication services primarily related to the manufacturing of critical process equipment for refinery and petrochemical facilities, the fabrication of tank farms and the fabrication of evaporators and brine heaters for desalination plants.

 

We evaluate the performance of our segments based on gross margin for each segment. Revenues include only sales to external customers. We do not include intersegment sales when we evaluate the performance of our segments.

 

No individual customer accounted for more than 10% of our consolidated revenues during any of the periods presented. The following table presents sales and other financial information by reportable segment for the years ended December 31, 2012, 2011 and 2010 (in thousands):

 

 

 

North

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

America

 

International

 

 

 

 

 

Reportable

 

 

 

 

 

 

 

Contract

 

Contract

 

Aftermarket

 

 

 

Segments

 

 

 

 

 

 

 

Operations

 

Operations

 

Services

 

Fabrication

 

Total

 

Other(1)

 

Total(2)

 

2012:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue from external customers

 

$

605,367

 

$

463,957

 

$

385,861

 

$

1,348,417

 

$

2,803,602

 

$

—

 

$

2,803,602

 

Gross margin(3)

 

316,123

 

279,349

 

82,271

 

156,480

 

834,223

 

—

 

834,223

 

Total assets

 

1,846,447

 

918,187

 

98,104

 

469,520

 

3,332,258

 

900,843

 

4,233,101

 

Capital expenditures

 

247,021

 

138,694

 

3,304

 

23,518

 

412,537

 

16,194

 

428,731

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2011:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue from external customers

 

$

588,034

 

$

445,059

 

$

371,327

 

$

1,225,459

 

$

2,629,879

 

$

—

 

$

2,629,879

 

Gross margin(3)

 

284,984

 

260,654

 

59,567

 

123,222

 

728,427

 

—

 

728,427

 

Total assets

 

1,982,513

 

887,046

 

92,169

 

384,099

 

3,345,827

 

896,951

 

4,242,778

 

Capital expenditures

 

182,178

 

58,767

 

1,768

 

22,077

 

264,790

 

7,395

 

272,185

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2010:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue from external customers

 

$

592,055

 

$

465,144

 

$

293,757

 

$

1,066,227

 

$

2,417,183

 

$

—

 

$

2,417,183

 

Gross margin(3)

 

300,431

 

289,787

 

45,365

 

161,505

 

797,088

 

—

 

797,088

 

Total assets

 

1,981,757

 

976,700

 

144,554

 

580,255

 

3,683,266

 

928,476

 

4,611,742

 

Capital expenditures

 

106,720

 

106,530

 

1,332

 

12,187

 

226,769

 

4,838

 

231,607

 

 

The following table presents assets from reportable segments to total assets as of December 31, 2012 and 2011 (in thousands):

 

 

 

Years Ended December 31,

 

 

 

2012

 

2011

 

Assets from reportable segments

 

$

3,332,258

 

$

3,345,827

 

Other assets(1)

 

900,843

 

896,951

 

Assets associated with discontinued operations

 

21,746

 

117,884

 

Consolidated assets

 

$

4,254,847

 

$

4,360,662

 

 

The following table presents geographic data as of and for the years ended December 31, 2012, 2011 and 2010 (in thousands):

 

 

 

U.S.

 

International

 

Consolidated

 

2012:

 

 

 

 

 

 

 

Revenues from external customers

 

$

1,820,069

 

$

983,533

 

$

2,803,602

 

Property, plant and equipment, net

 

$

1,882,580

 

$

959,451

 

$

2,842,031

 

 

 

 

 

 

 

 

 

2011:

 

 

 

 

 

 

 

Revenues from external customers

 

$

1,453,758

 

$

1,176,121

 

$

2,629,879

 

Property, plant and equipment, net

 

$

1,993,082

 

$

941,582

 

$

2,934,664

 

 

 

 

 

 

 

 

 

2010:

 

 

 

 

 

 

 

Revenues from external customers

 

$

1,090,096

 

$

1,327,087

 

$

2,417,183

 

Property, plant and equipment, net

 

$

1,985,180

 

$

1,029,418

 

$

3,014,598

 

 

(1)                  Includes corporate related items.

 

(2)                  Totals exclude assets, capital expenditures and the operating results of discontinued operations.

 

(3)                  Gross margin, a non-GAAP financial measure, is reconciled to net income (loss) below.

 

We define gross margin as total revenue less cost of sales (excluding depreciation and amortization expense). Gross margin is included as a supplemental disclosure because it is a primary measure used by our management to evaluate the results of revenue and cost of sales (excluding depreciation and amortization expense), which are key components of our operations. As an indicator of our operating performance, gross margin should not be considered an alternative to, or more meaningful than, net income (loss) as determined in accordance with GAAP. Our gross margin may not be comparable to a similarly titled measure of another company because other entities may not calculate gross margin in the same manner.

 

The following table reconciles net loss to gross margin (in thousands):

 

 

 

Years Ended December 31,

 

 

 

2012

 

2011

 

2010

 

Net loss

 

$

(37,169

)

$

(339,618

)

$

(113,241

)

Selling, general and administrative

 

376,359

 

352,780

 

351,998

 

Depreciation and amortization

 

350,847

 

356,972

 

392,153

 

Long-lived asset impairment

 

183,445

 

6,068

 

143,874

 

Restructuring charges

 

6,636

 

11,594

 

—

 

Goodwill impairment

 

—

 

196,807

 

—

 

Interest expense

 

134,376

 

149,473

 

136,149

 

Equity in (income) loss of non-consolidated affiliates

 

(51,483

)

471

 

609

 

Other (income) expense, net

 

430

 

(5,620

)

(11,413

)

Benefit from income taxes

 

(62,375

)

(10,605

)

(62,302

)

(Income) loss from discontinued operations, net of tax

 

(66,843

)

10,105

 

(40,739

)

Gross margin

 

$

834,223

 

$

728,427

 

$

797,088