13.	Segment Information

September 30, 2016,

the Company had

six

business segments. The overnight air cargo segment, comprised of the Company

’s Mountain Air Cargo, Inc. (“MAC”) and CSA Air, Inc. (“CSA”) subsidiaries, operates in the air express delivery services industry. The ground equipment sales segment, comprised of the Company’s Global Ground Support, LLC (“GGS”) subsidiary, manufactures and provides mobile deicers and other specialized equipment products to passenger and cargo airlines, airports, the U.S. military and industrial customers. The ground support services segment, comprised of the Company’s Global Aviation Services, LLC (“GAS”) subsidiary, provides ground support equipment maintenance and facilities maintenance services to domestic airlines and aviation service providers. The printing equipment and maintenance segment is comprised of Delphax and its subsidiaries, which was consolidated for financial accounting purposes beginning

November 24, 2015.

Delphax designs, manufactures and sells advanced digital print production equipment, maintenance contracts, spare parts, supplies and consumable items for these systems. The equipment is sold through Delphax and its subsidiaries located in Canada, the United Kingdom and France. A significant portion of Delphax’s net sales is related to service and support provided after the sale. Delphax has a significant presence in the check production marketplace in North America, Europe, Latin America, Asia and the Middle East. See Note

for a discussion of recent market and business developments impacting Delphax. The Company’s leasing segment, comprised of the Company’s Air T Global Leasing, LLC subsidiary (“ATGL”), provides funding for equipment leasing transactions, which includes transactions for the leasing of equipment manufactured by GGS and Delphax and transactions initiated by

third

parties unrelated to equipment manufactured by the Company or any of its subsidiaries. ATGL commenced operations during the quarter ended

December 31, 2015.

The commercial jet engines segment, comprised of Contrail Aviation, engages in the business of acquiring surplus commercial jet engines and components and supplying surplus and aftermarket commercial jet engine components. The segment commenced operations in

July 2016

in connection with Contrail Aviation’s acquisition of substantially all of the assets of Contrail Aviation Support, Inc.

Each business segment has separate management teams and infrastructures that offer different products and services. We evaluate the performance of our business segments based on operating income. In

March 2014,

the Company formed Space Age Insurance Company (“SAIC”), a captive insurance company licensed in Utah, and initially capitalized with

$250,000.

SAIC insures risks of the Company and its subsidiaries that were

not

previously insured by the Company

’s insurance programs and underwrites

third

-party risk through certain reinsurance arrangements. Beginning with the

fourth

quarter of fiscal year

2016,

premiums paid to SAIC by the Company are allocated among the operating segments based on segment revenue and certain identified corporate expenses was allocated to the segments based on the relative benefit of those expenses to each segment. Amounts previously presented for the quarter and

six

months ended

September 30, 2015

have been reclassified to conform to the current period allocation of these expenses.

Segment data is summarized as follows:

	Three Months Ended September 30,						Six Months Ended September 30,
	2016			2015			2016			2015
Operating Revenues:
Overnight Air Cargo	$	17,151,214		$	17,385,753		$	33,788,379		$	30,274,943
Ground Equipment Sales:
Domestic		10,305,102			20,163,034			15,691,171			22,141,063
International		783,775			1,120,106			2,068,394			3,181,314
Total Ground Equipment Sales		11,088,877			21,283,140			17,759,565			25,322,377
Ground Support Services		7,038,151			5,985,036			13,838,193			11,415,129
Printing Equipment and Maintenance:
Domestic		1,016,697			-			3,249,403			-
International		732,041			-			1,709,423			-
Total Printing Equipment and Maintenance		1,748,738			-			4,958,826			-
Commercial Jet Engines:
Domestic		450,188			-			450,188			-
International		844,919			-			844,919			-
Total Commercial Jet Engines		1,295,107			-			1,295,107			-
Leasing		221,745			-			463,515			-
Corporate		281,926			265,838			563,852			531,047
Intercompany		(302,768	)		(265,838	)		(3,651,194	)		(531,047	)
Total	$	38,522,990		$	44,653,929		$	69,016,243		$	67,012,449

Operating Income (Loss):
Overnight Air Cargo	$	440,804		$	1,479,205		$	1,419,981		$	1,384,762
Ground Equipment Sales		1,243,037			4,363,084			1,585,357			3,843,913
Ground Support Services		(240,717	)		(270,737	)		(350,769	)		(606,193	)
Printing Equipment and Maintenance		(11,851	)		-			(6,947,210	)		-
Commercial Jet Engines		42,806			-			42,806			-
Leasing		72,157			-			179,415			-
Corporate		(531,696	)		(66,901	)		(1,463,533	)		(166,931	)
Intercompany		7,199			-			(517,790	)		-
Total	$	1,021,739		$	5,504,651		$	(6,051,743	)	$	4,455,551

Capital Expenditures:
Overnight Air Cargo	$	36,040		$	51,664		$	36,040		$	75,989
Ground Equipment Sales		-			92,969			19,596			218,739
Ground Support Services		110,728			139,371			212,139			208,772
Printing Equipment and Maintenance		-			-			9,927			-
Commercial Jet Engines		-			-			-			-
Corporate		244,703			9,933			633,338			9,933
Leasing		-			-			3,066,500			-
Intercompany		-			-			(3,066,500	)		-
Total	$	391,471		$	293,937		$	911,040		$	513,433

Depreciation, amortization and impairment:
Overnight Air Cargo	$	30,100		$	34,621		$	59,309		$	69,093
Ground Equipment Sales		47,326			103,624			94,920			199,064
Ground Support Services		87,273			47,335			170,709			88,567
Printing Equipment and Maintenance		45,803			-			1,726,404			-
Commercial Jet Engines		28,406			-			28,406			-
Leasing		85,921			-			218,290			-
Corporate		36,042			6,924			66,785			14,397
Intercompany		(7,199	)		-			(21,550	)		-
Total	$	353,672		$	192,504		$	2,343,273		$	371,121

The elimination of intercompany revenues is related to the sale during the

six

months ended

September 30, 2016

ten

commercial deicing units by GGS to ATGL and

two

élan printers by Delphax to ATGL and premiums paid to SAIC, and the elimination of intercompany operating income for such period reflects the margins on the sales of those assets, elimination of excess depreciation and amortization related to the margin on those assets, and the premiums paid to SAIC. The assets are held for lease by ATGL.