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Segment Information

12 Months Ended

Dec. 31, 2019

Segment Information

Note 3: Segment Information

Unitil reports three​​​​​​​ segments: utility gas operations, utility electric operations and non-regulated. Unitil’s principal business is the local distribution of electricity in the southeastern seacoast and state capital  

regions of New Hampshire and the greater Fitchburg area of north central Massachusetts and the local distribution of natural gas in southeastern New Hampshire, portions of southern Maine to the Lewiston-Auburn area and in the greater Fitchburg area of north central Massachusetts. Unitil has three distribution utility subsidiaries, Unitil Energy, which operates in New Hampshire, Fitchburg, which operates in Massachusetts and Northern Utilities, which operates in New Hampshire and Maine.

Granite State is an interstate natural gas transmission pipeline company, operating 86 miles of underground gas transmission pipeline primarily located in Maine and New Hampshire. Granite State provides Northern Utilities with interconnection to three major natural gas pipelines and access to domestic natural gas supplies in the south and Canadian natural gas supplies in the north. Granite State derives its revenues principally from the transmission services provided to Northern Utilities and, to a lesser extent, third-party marketers. Granite State is included in the Gas column below.

Unitil Resources is the Company’s wholly-owned non-regulated subsidiary. Usource, Inc. and Usource L.L.C. (collectively, Usource), which the Company divested of in the first quarter of 2019, were wholly-owned subsidiaries of Unitil Resources. Usource provided brokering and advisory services to large commercial and industrial customers in the northeastern United States. Unitil Realty and Unitil Service provide centralized facilities, operations and administrative services to support the affiliated Unitil companies. Unitil Resources and Usource are included in the Non-Regulated column below.

Unitil Realty, Unitil Service and the holding company are included in the Other column of the table below. Unitil Service provides centralized management and administrative services, including information systems management and financial record keeping. Unitil Realty owns certain real estate, principally the Company’s corporate headquarters. The earnings of the holding company are principally derived from income earned on short-term investments and real property owned for Unitil and its subsidiaries’ use.

The segments follow the same accounting policies as described in the Summary of Significant Accounting Policies. Intersegment sales take place at cost and the effects of all intersegment and/or intercompany transactions are eliminated in the consolidated financial statements. Segment profit or loss is based on profit or loss from operations after income taxes and preferred stock dividends. Expenses used to determine operating income before taxes are charged directly to each segment or are allocated based on cost allocation factors included in rate applications approved by the FERC, NHPUC, MDPU, and MPUC. Assets allocated to each segment are based upon specific identification of such assets provided by Company records. 

The following table provides significant segment financial data for the years ended December 31, 2019, 2018 and 2017 (millions):

Year Ended December 31, 2019		Gas				Electric				Non- Regulated				Other				Total
Revenues:
Billed and Unbilled Revenue		$	212.1			$	223.1			$	—			$	—			$	435.2
Rate Adjustment Mechanism Revenue			(8.7	)			10.8				—				—				2.1
Other Operating Revenue—Non-Regulated			—				—				0.9				—				0.9
Total Operating Revenues			203.4				233.9				0.9				—				438.2
Interest Income			1.2				0.9				0.2				0.6				2.9
Interest Expense			14.4				9.4				—				2.8				26.6
Depreciation & Amortization Expense			28.5				22.6				—				0.9				52.0
Income Tax Expense (Benefit)			7.2				4.2				3.8				(1.4	)			13.8
Segment Profit			19.1				11.5				10.2				3.4				44.2
Segment Assets			823.3				529.3				0.3				17.9				1,370.8
Capital Expenditures			74.0				39.6				—				5.6				119.2
Year Ended December 31, 2018
Revenues:
Billed and Unbilled Revenue		$	210.7			$	228.7			$	—			$	—			$	439.4
Rate Adjustment Mechanism Revenue			5.4				(5.4	)			—				—				—
Other Operating Revenue—Non-Regulated			—				—				4.7				—				4.7
Total Operating Revenues			216.1				223.3				4.7				—				444.1
Interest Income			0.8				0.8				0.2				0.6				2.4
Interest Expense			14.2				9.0				—				3.2				26.4
Depreciation & Amortization Expense			24.9				23.1				0.1				2.3				50.4
Income Tax Expense (Benefit)			7.1				4.2				0.5				(3.4	)			8.4
Segment Profit			18.8				11.4				1.3				1.5				33.0
Segment Assets			764.1				484.2				6.9				43.1				1,298.3
Capital Expenditures			70.8				28.4				—				3.2				102.4
Year Ended December 31, 2017
Revenues		$	194.0			$	206.2			$	6.0			$	—			$	406.2
Interest Income			0.7				1.0				0.1				0.6				2.4
Interest Expense			13.7				8.8				—				3.0				25.5
Depreciation & Amortization Expense			22.4				23.4				0.1				1.0				46.9
Income Tax Expense (Benefit)			10.7				7.5				0.7				(1.4	)			17.5
Segment Profit			16.4				11.9				1.2				(0.5	)			29.0
Segment Assets			714.3				476.9				6.7				44.0				1,241.9
Capital Expenditures			72.1				33.7				—				13.5				119.3

X

- 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://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI http://asc.fasb.org/topic&trid=2134510

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