XML 22 R10.htm IDEA: XBRL DOCUMENT v3.20.2
Note 2 - Segment Information
 9 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

2. Segment Information

 

The accounting policies of the segments are described under note 1 – Summary of Significant Accounting Policies. The Company's businesses have been classified into three segments to be consistent with its business strategy and the reporting and review process used by the Company’s chief operating decision maker. These businesses sell products and provide services to customers primarily in the United States. The Company’s business structure currently includes the following three segments: Electric, Manufacturing and Plastics. The chart below indicates the companies included in each segment.

 

 

Electric includes the production, transmission, distribution and sale of electric energy in Minnesota, North Dakota and South Dakota by OTP. In addition, OTP is a participant in the Midcontinent Independent System Operator, Inc. (MISO) markets. OTP’s operations have been the Company’s primary business since 1907.

 

Manufacturing consists of businesses in the following manufacturing activities: contract machining, metal parts stamping, fabrication and painting, and production of plastic thermoformed horticultural containers, life science and industrial packaging, and material handling components. These businesses have manufacturing facilities in Georgia, Illinois and Minnesota and sell products primarily in the United States.

 

Plastics consists of businesses producing PVC pipe at plants in North Dakota and Arizona. The PVC pipe is sold primarily in the United States, west of the Mississippi River.

 

OTP is a wholly owned subsidiary of the Company. All of the Company’s other businesses are owned by its wholly owned subsidiary, Varistar Corporation. The Company’s Corporate operating costs include items such as corporate staff and overhead costs, the results of the Company’s captive insurance company and other items excluded from the measurement of operating segment performance. Corporate assets consist primarily of cash, prepaid expenses, investments and fixed assets. Corporate is not an operating segment. Rather, it is added to operating segment totals to reconcile to totals on the Company’s consolidated financial statements.

 

While no single customer accounted for over 10% of consolidated revenue in 2019, certain customers provided a significant portion of each business segment’s 2019 revenue. The Electric segment has one customer that provided 11.9% of 2019 segment revenues. The Manufacturing segment has one customer that manufactures and sells recreational vehicles that provided 23.8% of 2019 segment revenues and one customer that manufactures and sells lawn and garden equipment that provided 11.1% of 2019 segment revenues. The Manufacturing segment’s top five revenue-generating customers provided over 54% of 2019 segment revenues. The Plastics segment has two customers that individually provided 25.3% and 20.4% of 2019 segment revenues. The loss of any one of these customers would have a significant negative impact on the financial position and results of operations of the respective business segment and the Company.

 

All of the Company’s long-lived assets are within the United States and sales within the United States accounted for 98.9% and 98.5% of operating revenues for the respective three-month periods ended September 30, 2020 and 2019, and 99.0% and 98.7% of operating revenues for the respective nine-month periods ended September 30, 2020 and 2019.

 

The Company evaluates the performance of its business segments and allocates resources to them based on earnings contribution and return on total invested capital. Information for the business segments for the three- and nine-month periods ended September 30, 2019 and 2020 and total assets by business segment as of September 30, 2020 and December 31, 2019 are presented in the following tables:

 

Operating Revenue

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 

(in thousands)

 

2020

  

2019

  

2020

  

2019

 

Electric Segment:

                

Retail Sales Revenue from Contracts with Customers

 $96,827  $100,345  $288,861  $303,276 

Changes in Accrued ARP Revenues

  2,778   (921)  2,900   (1,601)

Total Retail Sales Revenue

  99,605   99,424   291,761   301,675 

Transmission Services Revenue

  12,288   11,692   32,802   34,023 

Wholesale Revenues – Company Generation

  1,500   1,631   3,141   4,099 

Other Revenues

  1,830   1,626   5,548   4,929 

Total Electric Segment Revenues

  115,223   114,373   333,252   344,726 

Manufacturing Segment:

                

Metal Parts and Tooling

  50,957   56,255   145,435   185,520 

Plastic Products and Tooling

  7,600   8,088   25,323   26,486 

Other

  1,292   1,379   3,518   5,034 

Total Manufacturing Segment Revenues

  59,849   65,722   174,276   217,040 

Plastics Segment – Sale of PVC Pipe Products

  60,693   48,566   155,769   142,100 

Intersegment Eliminations

  (10)  (9)  (39)  (39)

Total

 $235,755  $228,652  $663,258  $703,827 

 

Interest Charges

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 

(in thousands)

 

2020

  

2019

  

2020

  

2019

 

Electric

 $7,334  $6,300  $22,066  $19,566 

Manufacturing

  553   561   1,661   1,791 

Plastics

  163   197   497   561 

Corporate and Intersegment Eliminations

  518   481   1,129   1,272 

Total

 $8,568  $7,539  $25,353  $23,190 

 

Income Taxes

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 

(in thousands)

 

2020

  

2019

  

2020

  

2019

 

Electric

 $6,048  $4,066  $12,247  $9,874 

Manufacturing

  891   285   2,163   2,888 

Plastics

  3,638   1,914   7,373   5,287 

Corporate

  (1,480)  (1,329)  (3,240)  (4,142)

Total

 $9,097  $4,936  $18,543  $13,907 

 

Net Income (Loss)

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 

(in thousands)

 

2020

  

2019

  

2020

  

2019

 

Electric

 $24,737  $17,682  $54,225  $43,884 

Manufacturing

  3,311   3,155   8,476   11,987 

Plastics

  10,343   5,397   20,922   14,918 

Corporate

  (2,457)  (1,489)  (6,440)  (4,294)

Total

 $35,934  $24,745  $77,183  $66,495 

 

Identifiable Assets

 

  

September 30,

  

December 31,

 

(in thousands)

 

2020

  

2019

 

Electric

 $2,191,215  $1,931,525 

Manufacturing

  189,525   195,742 

Plastics

  104,661   92,049 

Corporate

  49,106   54,279 

Total

 $2,534,507  $2,273,595