Segment Information

3 Months Ended

Mar. 31, 2015

Segment Information

Segment Information

Note 10.  Segment Information

The company has three reportable segments: steel operations, metals recycling and ferrous resources operations, and steel fabrication operations.  Columbus is reported in the steel operations reporting segment from its September 16, 2014, acquisition date. The segment operations are described in Note 1 to the financial statements. Revenues included in the category “Other” are from subsidiary operations that are below the quantitative thresholds required for reportable segments and primarily consist of further processing, slitting, and sale of certain steel products, and the resale of certain secondary and excess steel products.  In addition, “Other” also includes certain unallocated corporate accounts, such as the company’s senior secured credit facility, senior notes, convertible senior notes, certain other investments and certain profit sharing expenses.

The company’s operations are primarily organized and managed by operating segment. Operating segment performance and resource allocations are primarily based on operating results before income taxes. The accounting policies of the reportable segments are consistent with those described in Note 1 to the financial statements. Intra-segment sales and any related profits are eliminated in consolidation. Refer to the company’s Annual Report on Form 10-K for the year ended December 31, 2014, for more information related to the company’s segment reporting. The company’s segment results for the three months ended March 31, 2015, and 2014, are as follows (in thousands):

For the three months ended			Metals Recycling /			Steel Fabrication
March 31, 2015	Steel Operations		Ferrous Resources			Operations		Other			Eliminations			Consolidated
Net Sales
External	$	1,313,426	$	427,411		$	161,024	$	22,114		$	—		$	1,923,975
External Non-U.S.	71,993		51,303			—		164			—			123,460
Other segments	48,903		227,078			4		6,689			(282,674		)	—
	1,434,322		705,792			161,028		28,967			(282,674		)	2,047,435
Operating income (loss)	111,540		(17,066		)	21,361		(19,920		)(1)	3,856		(2)	99,771
Income (loss) before income taxes	85,906		(24,670		)	19,594		(44,194		)	3,856			40,492
Depreciation and amortization	48,614		20,838			2,230		1,190			(50		)	72,822
Capital expenditures	14,686		17,658			1,037		(30		)	—			33,351
As of March 31, 2015
Assets	4,130,841		2,022,821			289,814		481,726		(3)	(189,364		)(4)	6,735,838
Liabilities	617,868		521,404			46,328		2,810,613		(5)	(183,468		)(6)	3,812,745

Footnotes related to the three months ended March 31, 2015 segment results (in millions):

(1) Corporate SG&A	$	(9.4	)
Company-wide equity-based compensation	(5.9		)
Profit sharing	(3.5		)
Other, net	(1.1		)
	$	(19.9	)

(2) Gross profit increase from intra-company sales $ 3.9 

(3) Cash and equivalents	$	136.5
Accounts receivable	11.0
Inventories	12.8
Deferred income taxes	33.4
Property, plant and equipment, net	67.9
Debt issuance costs	37.0
Intra-company debt	146.6
Other	36.5
	$	481.7

(4) Elimination of intra-company receivables	$	(37.6	)
Elimination of intra-company debt	(146.6		)
Other	(5.2		)
	$	(189.4	)

(5) Accounts payable	$	52.5
Income taxes payable	5.2
Accrued interest	51.6
Accrued profit sharing	3.5
Debt	2,600.1
Deferred income taxes	77.5
Other	20.2
	$	2,810.6

(6) Elimination of intra-company payables	$	(38.0	)
Elimination of intra-company debt	(146.6		)
Other	1.1
	$	(183.5	)

For the three months ended			Metals Recycling /			Steel Fabrication
March 31, 2014	Steel Operations		Ferrous Resources			Operations		Other			Eliminations			Consolidated
Net Sales
External	$	1,061,079	$	517,957		$	115,861	$	20,621		$	—		$	1,715,518
External Non-U.S.	56,519		57,817			—		228			—			114,564
Other segments	43,732		343,928			—		6,673			(394,333		)	—
	1,161,330		919,702			115,861		27,522			(394,333		)	1,830,082
Operating income (loss)	105,643		(15,519		)	3,126		(16,545		)(1)	4,227		(2)	80,932
Income (loss) before income taxes	91,998		(22,696		)	1,652		(24,187		)	4,227			50,994
Depreciation and amortization	27,377		26,621			2,222		1,399			(51		)	57,568
Capital expenditures	18,606		5,779			311		145			—			24,841
As of March 31, 2014
Assets	2,731,246		2,537,892			263,688		609,206		(3)	(228,175		)(4)	5,913,857
Liabilities	576,643		613,611			17,022		2,290,332		(5)	(218,081		)(6)	3,279,527

Footnotes related to the three months ended March 31, 2014 segment results (in millions):

(1) Corporate SG&A	$	(8.3	)
Company-wide equity-based compensation	(4.6		)
Profit sharing	(4.7		)
Other, net	1.1
	$	(16.5	)

(2) Gross profit increase from intra-company sales $ 4.2 

(3) Cash and equivalents	$	285.6
Accounts receivable	12.3
Inventories	13.5
Deferred income taxes	17.8
Property, plant and equipment, net	71.6
Debt issuance costs	24.4
Intra-company debt	153.8
Other	30.2
	$	609.2

(4) Elimination of intra-company receivables	$	(65.1	)
Elimination of intra-company debt	(153.8		)
Other	(9.3		)
	$	(228.2	)

(5) Accounts payable	$	44.1
Income taxes payable	23.5
Accrued interest	21.7
Accrued profit sharing	4.8
Debt	2,031.4
Deferred income taxes	138.0
Other	26.8
	$	2,290.3

(6) Elimination of intra-company payables	$	(65.5	)
Elimination of intra-company debt	(153.8		)
Other	1.2
	$	(218.1	)