Segment Information

6 Months Ended

Jun. 30, 2016

Segment Information

Segment Information

Note 10.  Segment Information

The company’s operations are primarily organized and managed by operating segment, which are steel operations, metals recycling operations, and steel fabrication operations. The segment operations are more fully described in Note 1 to the financial statements. 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. Amounts included in the category “Other” are from subsidiary operations that are below the quantitative thresholds required for reportable segments and primarily consist of our Minnesota ironmaking operations and several small joint ventures. In addition, “Other” also includes certain unallocated corporate accounts, such as the company’s senior secured credit facility, senior notes, certain other investments and certain profit sharing expenses.

The company’s segment results for the three- and six-month periods ended June 30, 2016, and 2015, each adjusted consistent with our current reportable segments presentation, are as follows (in thousands):

For the three months ended			Metals Recycling		Steel Fabrication
June 30, 2016	Steel Operations		Operations		Operations		Other			Eliminations			Consolidated
Net Sales
External	$	1,408,993	$	271,985	$	170,477	$	75,450		$	—		$	1,926,905
External Non-U.S.	57,711		39,075		65		146			—			96,997
Other segments	66,594		279,664		1,178		1,269			(348,705		)	—
	1,533,298		590,724		171,720		76,865			(348,705		)	2,023,902
Operating income (loss)	273,111		11,093		23,470		(45,569		)(1)	(5,983		)(2)	256,122
Income (loss) before income taxes	250,683		8,086		21,514		(53,006		)	(5,983		)	221,294
Depreciation and amortization	53,675		14,250		2,762		4,160			(52		)	74,795
Capital expenditures	30,098		4,482		567		539			—			35,686
As of June 30, 2016
Assets	$	3,992,230	$	1,076,596	$	334,530	$	1,348,290	(3)	$	(121,970	)(4)	$	6,629,676

Footnotes related to the three months ended June 30, 2016 segment results (in millions):

(1)	Corporate SG&A	$	(14.8	)
	Company-wide equity-based compensation	(7.3		)
	Profit sharing	(18.5		)
	Minnesota ironmaking operations	(4.0		)
	Other, net	(1.0		)
		$	(45.6	)
(2)	Gross profit decrease from intra-company sales	$	(6.0	)
(3)	Cash and equivalents	$	954.8
	Accounts receivable	21.0
	Inventories	33.2
	Property, plant and equipment, net	299.2
	Intra-company debt	6.3
	Other	33.8
		$	1,348.3
(4)	Elimination of intra-company receivables	$	(103.1	)
	Elimination of intra-company debt	(6.3		)
	Other	(12.6		)
		$	(122.0	)

For the three months ended			Metals Recycling		Steel Fabrication
June 30, 2015	Steel Operations		Operations		Operations		Other			Eliminations			Consolidated
Net Sales
External	$	1,303,278	$	346,103	$	154,513	$	83,467		$	—		$	1,887,361
External Non-U.S.	72,399		45,108		—		139			—			117,646
Other segments	53,560		254,238		12		6,702			(314,512		)	—
	1,429,237		645,449		154,525		90,308			(314,512		)	2,005,007
Operating income (loss)	99,013		8,282		27,660		(52,970		)(1)	(4,426		)(2)	77,559
Income (loss) before income taxes	77,290		4,723		25,879		(61,858		)	(4,426		)	41,608
Depreciation and amortization	51,242		17,014		2,158		3,910			(51		)	74,273
Capital expenditures	14,149		4,632		534		3,506			—			22,821
As of June 30, 2015
Assets	$	4,127,487	$	1,666,384	$	295,642	$	869,929	(3)	$	(132,679	)(4)	$	6,826,763

Footnotes related to the three months ended June 30, 2015 segment results (in millions):

(1)	Corporate SG&A	$	(8.1	)
	Company-wide equity-based compensation	(6.3		)
	Profit sharing	(3.5		)
	Minnesota ironmaking operations	(33.2		)
	Other, net	(1.9		)
		$	(53.0	)
(2)	Gross profit decrease from intra-company sales	$	(4.4	)
(3)	Cash and equivalents	$	356.9
	Accounts receivable	29.0
	Inventories	48.3
	Property, plant and equipment, net	315.7
	Intra-company debt	6.6
	Other	113.4
		$	869.9
(4)	Elimination of intra-company receivables	$	(117.1	)
	Elimination of intra-company debt	(6.6		)
	Other	(9.0		)
		$	(132.7	)

For the six months ended			Metals Recycling		Steel Fabrication
June 30, 2016	Steel Operations		Operations		Operations		Other			Eliminations			Consolidated
Net Sales
External	$	2,565,962	$	508,742	$	350,518	$	150,076		$	—		$	3,575,298
External Non-U.S.	117,918		71,725		79		183			—			189,905
Other segments	107,806		497,442		1,204		2,495			(608,947		)	—
	2,791,686		1,077,909		351,801		152,754			(608,947		)	3,765,203
Operating income (loss)	405,386		13,860		55,486		(77,499		)(1)	(9,146		)(2)	388,087
Income (loss) before income taxes	360,058		7,863		51,530		(92,297		)	(9,146		)	318,008
Depreciation and amortization	106,158		28,830		5,583		8,312			(103		)	148,780
Capital expenditures	54,002		7,562		1,171		659			—			63,394

Footnotes related to the six months ended June 30, 2016 segment results (in millions):

(1)	Corporate SG&A	$	(25.9	)
	Company-wide equity-based compensation	(14.3		)
	Profit sharing	(26.7		)
	Minnesota ironmaking operations	(8.3		)
	Other, net	(2.3		)
		$	(77.5	)
(2)	Gross profit decrease from intra-company sales	$	(9.1	)

For the six months ended			Metals Recycling			Steel Fabrication
June 30, 2015	Steel Operations		Operations			Operations		Other			Eliminations			Consolidated
Net Sales
External	$	2,616,704	$	720,395		$	315,537	$	158,699		$	—		$	3,811,335
External Non-U.S.	144,392		96,411			—		304			—			241,107
Other segments	102,463		480,654			16		24,905			(608,038		)	—
	2,863,559		1,297,460			315,553		183,908			(608,038		)	4,052,442
Operating income (loss)	213,978		3,784			49,021		(88,872		)(1)	(581		)(2)	177,330
Income (loss) before income taxes	166,621		(5,813		)	45,473		(123,600		)	(581		)	82,100
Depreciation and amortization	102,212		34,294			4,388		6,303			(102		)	147,095
Capital expenditures	30,349		11,047			1,571		13,205			—			56,172

Footnotes related to the six months ended June 30, 2015 segment results (in millions):

(1)	Corporate SG&A	$	(17.5	)
	Company-wide equity-based compensation	(12.2		)
	Profit sharing	(7.0		)
	Minnesota ironmaking operations	(46.1		)
	Other, net	(6.1		)
		$	(88.9	)
(2)	Gross profit decrease from intra-company sales	$	(0.6	)