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Business Segments
 9 Months Ended
Dec. 31, 2011
Business Segments [Abstract]  
Business Segments

12. Business Segments

     Business segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in assessing performance and deciding how to allocate resources.

 

     The Company segments its business into two market-facing business units: Wind and Grid. The Company believes this market-centric structure enables it to more effectively anticipate and meet the needs of wind turbine manufacturers, power generation project developers and electric utilities.

  • Wind. Through its Windtec Solutions, the Wind business segment enables manufacturers to field wind turbines with exceptional power output, reliability and affordability. The Company licenses its highly engineered wind turbine designs, provides extensive customer support services and supplies advanced power electronics and control systems to wind turbine manufactures. The Company's design portfolio includes a broad range of drive trains and power ratings up to 10 megawatts. The Company believes its unique engineering capabilities, ranging from bearings to advanced synchronous generators to blades, enables it to provide its partners with highly-optimized wind turbine platforms. Furthermore, these designs and support services typically lead to sales of its power electronics and software-based control systems, which are designed for optimized performance, efficiency and grid compatibility.
  • Grid. Through its Gridtec Solutions, the Grid business segment enables electric utilities and renewable energy project developers to connect, transmit and distribute power with exceptional efficiency, reliability and affordability. The Grid business unit provides transmission planning services that allow us to identify power grid congestion, poor power quality and other risks, which helps the Company determine how its solutions can improve network performance. These services often lead to sales of grid interconnection solutions for wind farms and solar power plants, power quality systems and transmission and distribution cable systems.

     Prior to April 1, 2011, the Company segmented its operations through two technology-centric business units: AMSC Power Systems and AMSC Superconductors. AMSC Power Systems included all of its Wind products, as well as Grid products that regulate voltage for wind farm voltage electric utilities, renewable generation project developers and industrial operations. Solutions from the Company's AMSC Superconductors business unit have been incorporated into its Grid business unit. All prior period segment disclosures have been revised to conform to management's current view of the Company's business segments.

The operating results for the two business segments are as follows (in thousands):

    Three months ended           Nine months ended    
    December 31,           December 31,    
    2011 2010     2011       2010
 
Revenues:                    
Wind $ 10,125   $ 10,840   $ 27,836 $ 183,162
Grid   7,933     20,730     20,080   43,691
Total $ 18,058   $ 31,570   $ 47,916 $ 226,853

 

                Nine months ended        
    Three months ended           December 31,        
    December 31,                    
    2011     2010     2011     2010  
Operating (loss) income:                        
Wind ($ 14,014 ) ($ 12,494 ) ($ 54,719 ) $ 51,499  
Grid   (6,313 )   (8,189 )   (24,511 )   (35,166 )
Unallocated corporate   (6,242 )   (2,277 )   (36,790 )   (10,135 )
expenses                        
Total ($ 26,569 ) ($ 22,960 ) ($ 116,020 ) $ 6,198  

 

     The accounting policies of the business segments are the same as those for the consolidated Company. The Company's business segments have been determined in accordance with the Company's internal management structure, which is organized based on operating activities. The Company evaluates performance based upon several factors, of which the primary financial measures are segment revenues and segment operating (loss) income. The disaggregated financial results of the segments reflect allocation of certain functional expense categories consistent with the basis and manner in which Company management

 

internally disaggregates financial information for the purpose of assisting in making internal operating decisions. In addition, certain corporate expenses which the Company does not believe are specifically attributable or allocable to either of the two business segments have been excluded from the segment operating (loss) income.

     For the three and nine months ended December 31, 2011, unallocated corporate expenses primarily consist of restructuring and impairment charges of $4.1 million and $8.4 million, respectively, and stock-based compensation expense of $2.1 million and $7.7 million, respectively. In addition, the nine months ended December 31, 2011 includes expense of $20.6 million for the write-off of an advanced payment to The Switch. Unallocated corporate expenses primarily consist of stock-based compensation expense of $2.2 million and $10.1 million for the three and nine months ended December 31, 2010, respectively.

Total assets for the two business segments are as follows (in thousands):

    December 31,   March 31,
    2011   2011
Wind $ 89,370 $ 145,464
Grid   70,285   67,081
Corporate assets   115,708   228,664
Total $ 275,363 $ 441,209

 

The following table sets forth customers who represented 10% or more of the Company's total revenues:

    Three months ended     Nine months ended  
    December 31,     December 31,  
    2011     2010     2011     2010  
Inox Wind, Ltd.   27 % < 10 %   21 % < 10 %
Doosan Heavy Industries & Construction Co Ltd.   12 % < 10 %   15 % < 10 %
Ergon Energy Corporation Limited   11 %   —   < 10 %   —  
Vestas – Australian Wind Technology Ltd < 10 %   44 % < 10 % < 10 %
Hyundai Heavy Industries Co., Ltd. < 10 %   10 % < 10 % < 10 %
Shenyang Blower Works Group Co., Ltd. < 10 %   11 % < 10 % < 10 %
Sinovel Wind Co., Ltd   —     —     —     66 %