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Business Segment Information | 9 Months Ended
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Sep. 30, 2017
Segment Reporting [Abstract] |
Business Segment Information |
15. | Business Segment Information
The Company’s operations are organized and reviewed by management along its product lines or end market that the segment serves and presented in three reportable segments. Energy Segment Our Energy segment provides customized solutions for the power generation and petrochemical industry. This includes natural gas turbine exhaust systems, dampers and diverters, gas and liquid separation and filtration equipment, selective catalytic reduction (“SCR”) and selective non-catalytic reduction (“SNCR”) systems, acoustical components and silencers, secondary separators (nuclear plant reactor vessels) and expansion joints, the design and manufacture of technologies for flue gas and diverter dampers, non-metallic expansion joints, and silencer and precipitator applications, primarily for natural gas and coal-fired power plants, refining, oil production and petrochemical processing, as well as a variety of other industries. Environmental Segment Our Environmental segment provides the air pollution control technologies that enable our customers to reduce their carbon footprint, lower energy consumption, minimize waste and meet compliance targets for toxic emissions, fumes, volatile organic compounds, process and industrial odors. These products and solutions include chemical and biological scrubbers, fabric filters and cartridge collectors, thermal and catalytic oxidation systems, cyclones, separators, gas absorbers and industrial ventilation systems. In addition, this segment designs and manufactures fluid catalytic cracking unit cyclones used in the petroleum and petrochemical refining process. This segment also provides component parts for industrial air systems and provides cost effective alternatives to traditional duct components, as well as custom metal engineered fabrication services. These products and services are applicable to a wide variety of industries. Fluid Handling and Filtration Segment Our Fluid Handling and Filtration segment provides the design and manufacture of high quality pump, filtration and fume exhaust solutions. This includes centrifugal pumps for corrosive, abrasive and high temperature liquids, filter products for air and liquid filtration, precious metal recovery systems, carbonate precipitators, and technologically advanced air movement and exhaust systems. These products are applicable to a wide variety of industries, particularly the aquarium/aquaculture, plating and metal finishing, food and beverage, chemical/petrochemical, wastewater treatment, desalination and pharmaceutical markets. The accounting policies of the reporting segments are the same as those described in the summary of significant accounting policies in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the SEC. Interest income and expense are not included in the measure of segment profit reviewed by management. Income taxes are also not included in the measure of segment operating profit reviewed by management. The operating results of the segments are reviewed through to the “Income from operations” line on the Condensed Consolidated Statements of Income. The financial segment information is presented in the following tables:
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
(dollars in thousands) |  | 2017 |  |  | 2016 |  |  | 2017 |  |  | 2016 |
Net Sales (less intra-, inter-segment sales) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 36,182 |  |  | $ | 50,259 |  |  | $ | 114,681 |  |  | $ | 151,058 |
Environmental Segment |  |  | 29,735 |  |  |  | 36,606 |  |  |  | 103,543 |  |  |  | 119,939 |
Fluid Handling and Filtration Segment |  |  | 20,105 |  |  |  | 14,866 |  |  |  | 54,269 |  |  |  | 46,874 |
Corporate and Other(1) |  |  | (1,035 | ) |  |  | (135 | ) |  |  | (985 | ) |  |  | (842 | )
Net sales |  | $ | 84,987 |  |  | $ | 101,596 |  |  | $ | 271,508 |  |  | $ | 317,029 |
(1) | Includes adjustment for revenue on intercompany jobs.
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
(dollars in thousands) |  | 2017 |  |  | 2016 |  |  | 2017 |  |  | 2016 |
Income from Operations |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 5,287 |  |  | $ | 8,502 |  |  | $ | 14,428 |  |  | $ | 20,065 |
Environmental Segment |  |  | 2,157 |  |  |  | 5,459 |  |  |  | 12,043 |  |  |  | 16,324 |
Fluid Handling and Filtration Segment |  |  | 4,299 |  |  |  | 3,109 |  |  |  | 11,756 |  |  |  | 9,507 |
Corporate and Other(2) |  |  | (5,404 | ) |  |  | (6,520 | ) |  |  | (20,184 | ) |  |  | (20,058 | )
Eliminations |  |  | (709 | ) |  |  | (51 | ) |  |  | (1,808 | ) |  |  | (971 | )
Income from operations |  | $ | 5,630 |  |  | $ | 10,499 |  |  | $ | 16,235 |  |  | $ | 24,867 |
(2) | Includes corporate compensation, professional services, information technology, acquisition and integration expenses, and other general and administrative corporate expenses / income. This figure excludes earn-out expenses / income, which are recorded in the segment in which the expense / income occurs. See Note 7 for the earn-out expenses / income by segment.
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
(dollars in thousands) |  | 2017 |  |  | 2016 |  |  | 2017 |  |  | 2016 |
Property and Equipment Additions |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 69 |  |  | $ | 4 |  |  | $ | 419 |  |  | $ | 232 |
Environmental Segment |  |  | 68 |  |  |  | 225 |  |  |  | 110 |  |  |  | 529 |
Fluid Handling and Filtration Segment(3) |  |  | 17 |  |  |  | 1,118 |  |  |  | 236 |  |  |  | 4,428 |
Corporate and Other |  |  | 11 |  |  |  | 1 |  |  |  | 41 |  |  |  | 7 |
Property and equipment additions |  | $ | 165 |  |  | $ | 1,348 |  |  | $ | 806 |  |  | $ | 5,196 |
(3) | Includes non-cash additions of $1,089 and $4,385 for property, plant, and equipment acquired under capital leases during the three months ended September 30, 2016 and nine months ended September 30, 2016, respectively.
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
(dollars in thousands) |  | 2017 |  |  | 2016 |  |  | 2017 |  |  | 2016 |
Depreciation and Amortization |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 1,927 |  |  | $ | 2,341 |  |  | $ | 5,957 |  |  | $ | 8,082 |
Environmental Segment |  |  | 813 |  |  |  | 994 |  |  |  | 2,500 |  |  |  | 2,868 |
Fluid Handling and Filtration Segment |  |  | 1,168 |  |  |  | 1,321 |  |  |  | 3,563 |  |  |  | 3,969 |
Corporate and Other |  |  | 29 |  |  |  | 33 |  |  |  | 85 |  |  |  | 98 |
Depreciation and Amortization |  | $ | 3,937 |  |  | $ | 4,689 |  |  | $ | 12,105 |  |  | $ | 15,017 |
(dollars in thousands) |  | September 30, 2017 |  |  | December 31, 2016 |
Identifiable Assets |  |  |  |  |  |  |  |
Energy Segment |  | $ | 234,575 |  |  | $ | 257,566 |
Environmental Segment |  |  | 106,373 |  |  |  | 118,680 |
Fluid Handling and Filtration Segment |  |  | 102,485 |  |  |  | 104,294 |
Corporate and Other(4) |  |  | 12,110 |  |  |  | 18,094 |
Identifiable Assets |  | $ | 455,543 |  |  | $ | 498,634 |
(4) | Corporate assets primarily consist of cash and income tax related assets.
(dollars in thousands) |  | September 30, 2017 |  |  | December 31, 2016 |
Goodwill |  |  |  |  |  |  |  |
Energy Segment |  | $ | 76,913 |  |  | $ | 75,827 |
Environmental Segment |  |  | 48,203 |  |  |  | 48,203 |
Fluid Handling and Filtration Segment |  |  | 46,123 |  |  |  | 46,123 |
Goodwill |  | $ | 171,239 |  |  | $ | 170,153 |
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, 2017 |
|  |  |  |  |  |  |  |  |  | Less Inter-Segment Sales |  |  |  |  |
(dollars in thousands) |  | Total Sales |  |  | Intra- Segment Sales |  |  | Environmental |  |  | Energy |  |  | FHF |  |  | Corp and Other |  |  | Net Sales to Outside Customers |
Net Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 37,290 |  |  | $ | (1,102 | ) |  | $ | (6 | ) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 36,182 |
Environmental Segment |  |  | 30,138 |  |  |  | (396 | ) |  |  | — |  |  |  | (1 | ) |  |  | (6 | ) |  |  | — |  |  |  | 29,735 |
Fluid Handling and Filtration Segment |  |  | 20,768 |  |  |  | (570 | ) |  |  | (55 | ) |  |  | (38 | ) |  |  | — |  |  |  | — |  |  |  | 20,105 |
Corporate and Other(5) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (1,035 | ) |  |  | (1,035 | )
Net Sales |  | $ | 88,196 |  |  | $ | (2,068 | ) |  | $ | (61 | ) |  | $ | (39 | ) |  | $ | (6 | ) |  | $ | (1,035 | ) |  | $ | 84,987 |
|  | Three Months Ended September 30, 2016 |
|  |  |  |  |  |  |  |  |  | Less Inter-Segment Sales |  |  |  |  |
(dollars in thousands) |  | Total Sales |  |  | Intra- Segment Sales |  |  | Environmental |  |  | Energy |  |  | FHF |  |  | Corp and Other |  |  | Net Sales to Outside Customers |
Net Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 51,155 |  |  | $ | (874 | ) |  | $ | (22 | ) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 50,259 |
Environmental Segment |  |  | 38,454 |  |  |  | (941 | ) |  |  | — |  |  |  | (878 | ) |  |  | (29 | ) |  |  | — |  |  |  | 36,606 |
Fluid Handling and Filtration Segment |  |  | 15,451 |  |  |  | (313 | ) |  |  | (88 | ) |  |  | (184 | ) |  |  | — |  |  |  | — |  |  |  | 14,866 |
Corporate and Other(5) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (135 | ) |  |  | (135 | )
Net Sales |  | $ | 105,060 |  |  | $ | (2,128 | ) |  | $ | (110 | ) |  | $ | (1,062 | ) |  | $ | (29 | ) |  | $ | (135 | ) |  | $ | 101,596 |
|  | Nine Months Ended September 30, 2017 |
|  |  |  |  |  |  |  |  |  | Less Inter-Segment Sales |  |  |  |  |
(dollars in thousands) |  | Total Sales |  |  | Intra- Segment Sales |  |  | Environmental |  |  | Energy |  |  | FHF |  |  | Corp and Other |  |  | Net Sales to Outside Customers |
Net Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 120,958 |  |  | $ | (6,249 | ) |  | $ | (28 | ) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 114,681 |
Environmental Segment |  |  | 106,404 |  |  |  | (2,086 | ) |  |  | — |  |  |  | (730 | ) |  |  | (45 | ) |  |  | — |  |  |  | 103,543 |
Fluid Handling and Filtration Segment |  |  | 56,620 |  |  |  | (1,727 | ) |  |  | (477 | ) |  |  | (147 | ) |  |  | — |  |  |  | — |  |  |  | 54,269 |
Corporate and Other(5) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (985 | ) |  |  | (985 | )
Net Sales |  | $ | 283,982 |  |  | $ | (10,062 | ) |  | $ | (505 | ) |  | $ | (877 | ) |  | $ | (45 | ) |  | $ | (985 | ) |  | $ | 271,508 |
|  | Nine Months Ended September 30, 2016 |
|  |  |  |  |  |  |  |  |  | Less Inter-Segment Sales |  |  |  |  |
(dollars in thousands) |  | Total Sales |  |  | Intra- Segment Sales |  |  | Environmental |  |  | Energy |  |  | FHF |  |  | Corp and Other |  |  | Net Sales to Outside Customers |
Net Sales |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Energy Segment |  | $ | 153,476 |  |  | $ | (2,019 | ) |  | $ | (399 | ) |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 151,058 |
Environmental Segment |  |  | 126,029 |  |  |  | (3,539 | ) |  |  | — |  |  |  | (2,345 | ) |  |  | (206 | ) |  |  | — |  |  |  | 119,939 |
Fluid Handling and Filtration Segment |  |  | 48,508 |  |  |  | (1,168 | ) |  |  | (282 | ) |  |  | (184 | ) |  |  | — |  |  |  | — |  |  |  | 46,874 |
Corporate and Other(5) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (842 | ) |  |  | (842 | )
Net Sales |  | $ | 328,013 |  |  | $ | (6,726 | ) |  | $ | (681 | ) |  | $ | (2,529 | ) |  | $ | (206 | ) |  | $ | (842 | ) |  | $ | 317,029 |
(5) | Includes adjustment for revenue on intercompany jobs.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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