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Segment Data (Notes)
 6 Months Ended
Jun. 30, 2013
Segment Reporting [Abstract]  
Segment Data
Segment Data
We report our assets and operating results in two reportable segments: (i) pipelines and transportation and (ii) wholesale marketing and terminalling:
•
The pipelines and transportation segment provides crude oil gathering, transportation and storage services to Delek's refining operations and independent third parties.
•
The wholesale marketing and terminalling segment provides marketing and terminalling services to Delek's refining operations and independent third parties.
Our operating segments adhere to the same accounting polices used for our consolidated financial statements. Our operating segments are managed separately because each segment requires different industry knowledge, technology and marketing strategies. Decisions concerning the allocation of resources and assessment of operating performance are made based on this segmentation. Management measures the operating performance of each of its reportable segments based on the segment contribution margin. Segment contribution margin is defined as net sales less cost of sales and operating expenses, excluding depreciation and amortization.
The following is a summary of business segment operating performance as measured by contribution margin for the period indicated (in thousands):
 
 
Three Months Ended June 30, 2013
 
 
Pipelines and Transportation
 
Wholesale Marketing and Terminalling
 
Consolidated
Net sales
 
$
13,666

 
$
216,475

 
$
230,141

Operating costs and expenses:
 
 
 
 
 
 
Cost of goods sold
 
—

 
207,966

 
207,966

Operating expenses
 
4,727

 
1,340

 
6,067

Segment contribution margin
 
$
8,939

 
$
7,169

 
16,108

General and administrative expenses
 
 
 
 
 
1,111

Depreciation and amortization
 
 
 
 
 
2,372

Operating income
 
 
 
 
 
$
12,625

Total assets
 
$
156,842

 
$
101,980

 
$
258,822

Capital spending (excluding business combinations)
 
365

 
688

 
$
1,053


 
 
Three Months Ended June 30, 2012
 
 
Predecessor
 
 
Pipelines and Transportation
 
Wholesale Marketing and Terminalling
 
Combined
Net sales
 
$
6,801

 
$
255,679

 
$
262,480

Operating costs and expenses:
 
 
 
 
 
 
Cost of goods sold
 
—

 
249,060

 
249,060

Operating expenses
 
3,815

 
1,069

 
4,884

Segment contribution margin
 
$
2,986

 
$
5,550

 
8,536

General and administrative expenses
 
 
 
 
 
2,346

Depreciation and amortization
 
 
 
 
 
2,260

Loss on sale of assets
 
 
 
 
 
(5
)
Operating income
 
 
 
 
 
$
3,935

Total assets
 
$
111,214

 
$
125,592

 
$
236,806

Capital spending (excluding business combinations)
 
$
715

 
$
475

 
$
1,190


 
 
Six Months Ended June 30, 2013
 
 
Pipelines and Transportation
 
Wholesale Marketing and Terminalling
 
Consolidated
Net sales
 
$
27,265

 
$
413,771

 
$
441,036

Operating costs and expenses:
 
 
 
 
 
 
Cost of goods sold
 
—

 
395,826

 
395,826

Operating expenses
 
9,348

 
2,581

 
11,929

Segment contribution margin
 
$
17,917

 
$
15,364

 
33,281

General and administrative expenses
 
 
 
 
 
2,788

Depreciation and amortization
 
 
 
 
 
4,724

Operating income
 
 
 
 
 
$
25,769

Total assets
 
$
156,842

 
$
101,980

 
$
258,822

Capital spending (excluding business combinations)
 
$
1,493

 
$
836

 
$
2,329


 
 
Six Months Ended June 30, 2012
 
 
Predecessor
 
 
Pipelines and Transportation
 
Wholesale Marketing and Terminalling
 
Combined
Net sales
 
$
13,480

 
$
488,083

 
$
501,563

Operating costs and expenses:
 
 
 
 
 
 
Cost of goods sold
 
—

 
474,469

 
474,469

Operating expenses
 
7,093

 
2,001

 
9,094

Segment contribution margin
 
$
6,387

 
$
11,613

 
18,000

General and administrative expenses
 
 
 
 
 
4,753

Depreciation and amortization
 
 
 
 
 
4,394

Loss on sale of assets
 
 
 
 
 
—

Operating income
 
 
 
 
 
$
8,853

Total assets
 
$
111,214

 
$
125,592

 
$
236,806

Capital spending (excluding business combinations)
 
$
1,091

 
$
1,112

 
$
2,203


Property, plant and equipment, accumulated depreciation and depreciation expense by reporting segment as of and for the three and six months ended June 30, 2013 were as follows (in thousands):

 
 
Pipelines and Transportation
 
Wholesale Marketing and Terminalling
 
Consolidated
Property, plant and equipment
 
$
127,293

 
$
47,336

 
$
174,629

Less: Accumulated depreciation
 
(11,288
)
 
(11,659
)
 
(22,947
)
Property, plant and equipment, net
 
$
116,005

 
$
35,677

 
$
151,682

Depreciation expense for the three months ended June 30, 2013
 
$
1,660

 
$
446

 
$
2,106

Depreciation expense for the six months ended June 30, 2013
 
$
3,265

 
$
892

 
$
4,157


In accordance with ASC 360, Property, Plant & Equipment, we evaluate the realizability of property, plant and equipment as events occur that might indicate potential impairment.