XML 32 R25.htm IDEA: XBRL DOCUMENT v3.3.0.814
Reportable Segments
 9 Months Ended
Sep. 30, 2015
Segment Reporting [Abstract]  
Reportable Segments
18. Reportable Segments
 
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 related to the manufacturing of critical process equipment for refinery and petrochemical facilities, the fabrication of tank farms and evaporators and brine heaters for desalination plants.
 
We evaluate the performance of our segments based on gross margin for each segment. Revenue includes only sales to external customers. We do not include intersegment sales when we evaluate our segments’ performance.

The following tables present revenue and other financial information by reportable segment during the three and nine months ended September 30, 2015 and 2014 (in thousands):
 
Three Months Ended
North
America
Contract
Operations
 
International
Contract
Operations
 
Aftermarket
Services
 
Fabrication
 
Reportable
Segments
Total
September 30, 2015:
 

 
 

 
 

 
 

 
 

Revenue from external customers
$
191,692

 
$
114,104

 
$
82,443

 
$
261,262

 
$
649,501

Gross margin(1)
113,765

 
72,990

 
18,670

 
34,337

 
239,762

September 30, 2014:
 

 
 

 
 

 
 

 
 

Revenue from external customers
$
191,000

 
$
124,355

 
$
96,005

 
$
312,472

 
$
723,832

Gross margin(1)
108,547

 
76,372

 
20,495

 
61,071

 
266,485

 
Nine Months Ended
North
America
Contract
Operations
 
International
Contract
Operations
 
Aftermarket
Services
 
Fabrication
 
Reportable
Segments
Total
September 30, 2015:
 

 
 

 
 

 
 

 
 

Revenue from external customers
$
592,212

 
$
350,045

 
$
260,133

 
$
860,025

 
$
2,062,415

Gross margin(1)
350,385

 
219,847

 
60,255

 
125,128

 
755,615

September 30, 2014:
 

 
 

 
 

 
 

 
 

Revenue from external customers
$
529,463

 
$
369,787

 
$
284,412

 
$
922,448

 
$
2,106,110

Gross margin(1)
298,415

 
234,270

 
61,784

 
161,476

 
755,945

________________________________
(1)
Gross margin, a non-GAAP financial measure, is reconciled, in total, to net income (loss), its most directly comparable measure calculated and presented in accordance with GAAP, 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 income (loss) to gross margin (in thousands):
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2015
 
2014
 
2015
 
2014
Net income (loss)
$
(4,233
)
 
$
42,158

 
$
44,641

 
$
97,915

Selling, general and administrative
82,124

 
94,806

 
252,684

 
283,096

Depreciation and amortization
94,924

 
98,256

 
285,057

 
295,734

Long-lived asset impairment
23,708

 
12,385

 
51,860

 
26,039

Restructuring and other charges
11,998

 
219

 
36,392

 
5,394

Interest expense
28,577

 
25,737

 
84,273

 
86,767

Equity in income of non-consolidated affiliates
(5,084
)
 
(4,951
)
 
(15,152
)
 
(14,553
)
Other (income) expense, net
30,129

 
4,663

 
38,975

 
(1,442
)
Provision for (benefit from) income taxes
(3,605
)
 
11,215

 
14,628

 
31,494

Income from discontinued operations, net of tax
(18,776
)
 
(18,003
)
 
(37,743
)
 
(54,499
)
Gross margin
$
239,762

 
$
266,485

 
$
755,615

 
$
755,945