16.

Business Segment Information

The Company’s operations are organized and reviewed by management along its product lines and presented in four reportable segments. The results of the segments are reviewed through to the “(Loss) income from operations” line on the condensed consolidated statements of operations.

Engineered Equipment Technology and Parts Group (“EET&P”)

Our Engineered Equipment and Parts Group, located in the United States as well as the Netherlands, Canada, Brazil, China, and India, is comprised of Aarding, Adwest, AVC, CECO Abatement, CECO Filters, Busch International, Effox, Fisher-Klosterman, and Flextor. We enable our customers to meet Best Available Control Technology requirements and compliance targets for fumes, volatile organic compounds, process, and industrial odors. Our services eliminate toxic emission fumes and volatile organic compounds from large-scale industrial processes. Global industries served include refining, petrochemical, traditional power, natural gas power, aluminum, steel, automotive, chemical, and the largest industrial facilities.

Met-Pro Group (“MP”)

Our Met-Pro Group is comprised of our recent acquisition of Met-Pro, a global provider of a wide range of products and services for industrial, commercial, municipal and residential markets. These include product recovery and pollution control technologies for purification of air and liquids; fluid handling technologies for corrosive, abrasive and high temperature liquids; and filtration and purification technologies, which include proprietary water treatment chemicals and filter products for air and liquid filtration. The MP Group includes Met-Pro’s three main business areas: Product Recovery/Pollution Control Technologies, Fluid Handling Technologies, and Filtration/Purification Technologies, each of which is comprised of a variety of business units and brands.

Contracting / Services Group (“C/S”)

Our Contracting/Services Group is comprised of the contracting/services operations of our Kirk & Blum divisions. We provide custom metal fabrication services at our Kirk & Blum Columbia, Tennessee and Louisville, Kentucky locations. These facilities are used to fabricate parts, subassemblies, and customized products for air pollution and non-air pollution applications from sheet, plate, and structurals.

Component Parts Group (“CP”)

We market component parts for industrial air systems to contractors, distributors and dealers throughout the United States.

The accounting policies of the segments are the same as those in the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC.

Summary of Business by Segment


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2013			2012			2013		2012
Net Sales (less intra-, inter-segment sales)
Engineered Equipment Technology and Parts
United States	$	21,741		$	18,425		$	64,444	$	55,889
Netherlands		7,510			—			17,904		—
Canada		842			1,855			3,304		5,883
China		2,553			1,787			5,564		3,289
Brazil		—			—			—		121
India		—			173			—		173

subtotal		32,646			22,240			91,216		65,355
Met-Pro		7,273			—			7,273		—
Contracting / Services		4,412			5,644			13,507		19,472
Component Parts		5,664			5,238			16,497		15,854
Corporate		(199	)		(20	)		97		39

Net sales	$	49,796		$	33,102		$	128,590	$	100,720


	Three Months Ended September 30,						Nine Months Ended September 30,
(dollars in thousands)	2013			2012			2013			2012
Net Operating (Loss) Income
Engineered Equipment Technology and Parts	$	4,176		$	3,946		$	14,209		$	11,110
Met-Pro		(406	)		—			(406	)		—
Contracting / Services		(2,187	)		836			(1,268	)		2,520
Component Parts		1,028			966			3,085			3,378
Corporate and other (a)		(5,334	)		(1,455	)		(11,485	)		(4,667	)
Eliminations		(633	)		(42	)		(846	)		(58	)

Net operating (loss) income	$	(3,356	)	$	4,251		$	3,289		$	12,283

(a)	Includes acquisition and integration expenses, corporate compensation, professional services, information technology, and other general and administrative corporate expenses.


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2013		2012		2013		2012
Property and Equipment Additions
Engineered Equipment Technology and Parts	$	251	$	57	$	434	$	109
Met-Pro		—		—		—		—
Contracting / Services		7		14		28		44
Component Parts		39		21		71		59
Corporate		—		10		—		22

Property and equipment additions	$	297	$	102	$	533	$	234


	Three Months Ended September 30,				Nine Months Ended September 30,
(dollars in thousands)	2013		2012		2013		2012
Depreciation and Amortization
Engineered Equipment Technology and Parts	$	909	$	146	$	1,960	$	445
Met-Pro		849		—		849		—
Contracting / Services		51		53		155		163
Component Parts		46		48		139		144
Corporate		33		53		98		158

Depreciation and Amortization	$	1,888	$	300	$	3,201	$	910


(dollars in thousands)	September 30, 2013		December 31, 2012
Identifiable Assets
Engineered Equipment Technology and Parts	$	127,653	$	60,516
Met-Pro		205,201		—
Contracting / Services		6,230		8,055
Component Parts		6,037		5,573
Corporate (b)		8,515		19,960

Identifiable Assets (c)	$	353,636	$	94,104

(b)	Corporate assets primarily consists of cash and income tax related assets.

(c)	The Company has revised its business segment reporting primarily to exclude nontrade accounts receivable in order to better reflect the manner in which such assets are reviewed by management.


(dollars in thousands)	September 30, 2013		December 31, 2012
Goodwill
Engineered Equipment Technology and Parts	$	28,122	$	19,548
Met-Pro		105,429		—


Goodwill	$	133,551	$	19,548

Intra-segment and Inter-segment Revenues

The Company has multiple divisions that sell to each other within segments (intra-segment sales) and between segments (inter-segment sales) as indicated in the following tables:


	Three months ended September 30, 2013
(dollars in thousands)	Total sales		Less intra- segment Sales			Less inter-segment sales												Net sales to outside customers
(dollars in thousands)	Total sales		Less intra- segment Sales			EE&P			C/S			CP			Corp. (a)			Net sales to outside customers
Net Sales
Engineered Equipment Technology and Parts
United States	$	22,519	$	(616	)	$	—		$	(162	)	$			$	—		$	21,741
Netherlands		7,405		105			—			—			—			—			7,510
China		2,696		(143	)		—			—			—			—			2,553
Canada		1,503		(661	)		—			—			—			—			842

Subtotal		34,123		(1,315	)		—			(162	)		—			—			32,646
Met-Pro		7,559		(286	)		—			—			—			—			7,273
Contracting / Services		5,018		(205	)		(328	)		—			(73	)		—			4,412
Component Parts		5,994		(135	)		(4	)		(191	)		—			—			5,664
Corporate and other (a)		—		—			—			—			—			(199	)		(199	)

Net sales	$	52,694	$	(1,941	)	$	(332	)	$	(353	)	$	(73	)	$	(199	)	$	49,796


	Three months ended September 30, 2012
(dollars in thousands)	Total sales		Less intra- segment sales			Less inter-segment sales											Net sales to outside customers
(dollars in thousands)	Total sales		Less intra- segment sales			EE&P			C/S			CP		Corp. (a)			Net sales to outside customers
Net Sales
Engineered Equipment Technology and Parts
United States	$	18,775	$	(334	)	$	—		$	(16	)	$	—	$	—		$	18,425
China		2,166		(379	)		—			—			—		—			1,787
Canada		1,865		(10	)		—			—			—		—			1,855
Brazil		—		—			—			—			—		—			—
India		173		—			—			—			—		—			173

Subtotal		22,979		(723	)		—			(16	)		—		—			22,240
Contracting / Services		6,166		(20	)		(502	)		—			—		—			5,644
Component Parts		5,524		(89	)		(3	)		(194	)		—		—			5,238
Corporate and other (a)		0		—			—			—			—		(20	)		(20	)

Net sales	$	34,669	$	(832	)	$	(505	)	$	(210	)	$	—	$	(20	)	$	33,102


	Nine months ended September 30, 2013
(dollars in thousands)	Total sales		Less intra- segment Sales			Less inter-segment sales											Net sales to outside customers
(dollars in thousands)	Total sales		Less intra- segment Sales			EE&P			C/S			CP			Corp. (a)		Net sales to outside customers
Net Sales
Engineered Equipment Technology and Parts
United States	$	66,473	$	(1,391	)	$	—		$	(638	)	$	—		$	—	$	64,444
Netherlands		17,799		105			—			—			—			—		17,904
China		6,672		(1,108	)		—			—			—			—		5,564
Canada		4,636		(1,332	)		—			—			—			—		3,304

Subtotal		95,580		(3,726	)		—			(638	)		—			—		91,216
Met-Pro		7,559		(286	)		—			—			—			—		7,273
Contracting / Services		15,383		(412	)		(1,391	)		—			(73	)		—		13,507
Component Parts		17,525		(405	)		(17	)		(606	)		—			—		16,497
Corporate and other (a)		—		—			—			—			—			97		97

Net sales	$	136,047	$	(4,829	)	$	(1,408	)	$	(1,244	)	$	(73	)	$	97	$	128,590


	Nine months ended September 30, 2012
(dollars in thousands)	Total sales		Less intra- segment sales			Less inter-segment sales										Net sales to outside customers
(dollars in thousands)	Total sales		Less intra- segment sales			EE&P			C/S			CP		Corp. (a)		Net sales to outside customers
Net Sales
Engineered Equipment Technology and Parts
United States	$	57,202	$	(687	)	$	—		$	(626	)	$	—	$	—	$	55,889
China		5,223		(1,934	)		—			—			—		—		3,289
Canada		5,820		63			—			—			—		—		5,883
Brazil		121		—			—			—			—		—		121
India		173		—			—			—			—		—		173

Subtotal		68,539		(2,558	)		—			(626	)		—		—		65,355
Contracting / Services		20,577		(68	)		(1,037	)		—			—		—		19,472
Component Parts		16,804		(236	)		(21	)		(693	)		—		—		15,854
Corporate and other (a)		19		—			—			(10	)		—		30		39

Net sales	$	105,939	$	(2,862	)	$	(1,058	)	$	(1,329	)	$	—	$	30	$	100,720

(a)	Includes adjustment for revenue on intercompany jobs.