Segment Information

9 Months Ended

Sep. 30, 2017

Segment Information

Segment Information

Note 9.  Segment Information

The company’s operations are primarily organized and managed by reportable operating segments, which are steel operations, metals recycling operations, and steel fabrication operations. The segment operations are more fully described in Note 1 to these 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 these 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.

Note 9.  Segment Information (Continued)

The company’s segment results are as follows (in thousands):

			Metals		Steel
For the three months ended	Steel		Recycling		Fabrication
September 30, 2017	Operations		Operations		Operations		Other			Eliminations			Consolidated
Net Sales
External	$	1,700,707	$	301,422	$	211,271	$	101,057		$	-		$	2,314,457
External Non-U.S.		82,098		46,793		34		-			-			128,925
Other segments		65,321		360,982		89		116			(426,508)			-
		1,848,126		709,197		211,394		101,173			(426,508)			2,443,382
Operating income (loss)		276,547		17,624		21,862		(44,326)	(1)		(692)			271,015
Income (loss) before income taxes		255,539		16,020		20,199		(56,754)			(692)			234,312
Depreciation and amortization		57,644		12,020		2,866		2,680			-			75,210
Capital expenditures		31,654		8,589		1,524		1,028			-			42,795
As of September 30, 2017
Assets	$	4,353,904	$	1,032,018	$	381,931	$	1,346,968	(2)	$	(154,084)	(3)	$	6,960,737

	Footnotes related to the three months ended September 30, 2017, segment results (in millions):
(1)	Corporate SG&A	$	(12.1)	(3)	Elimination of intra-company receivables	$	(130.4)
	Company-wide equity-based compensation		(6.8)		Elimination of intra-company debt		(10.7)
	Profit sharing		(20.2)		Other		(13.0)
	Other, net		(5.2)			$	(154.1)
		$	(44.3)
(2)	Cash and equivalents	$	1,065.9
	Accounts receivable		14.0
	Inventories		42.8
	Property, plant and equipment, net		162.4
	Intra-company debt		10.7
	Other		51.2
		$	1,347.0

Note 9.  Segment Information (Continued)

			Metals		Steel
For the three months ended	Steel		Recycling		Fabrication
September 30, 2016	Operations		Operations		Operations		Other			Eliminations		Consolidated
Net Sales
External	$	1,502,726	$	260,518	$	177,341	$	60,282		$	-	$	2,000,867
External Non-U.S.		54,776		45,574		88		5			-		100,443
Other segments		70,384		259,171		1,211		1,108			(331,874)		-
		1,627,886		565,263		178,640		61,395			(331,874)		2,101,310
Operating income (loss)		307,553		6,154		17,744		(47,687)	(1)		91		283,855
Income (loss) before income taxes		285,131		2,437		15,645		(59,999)			91		243,305
Depreciation and amortization		53,456		13,836		2,848		4,101			(51)		74,190
Capital expenditures		49,200		9,506		747		321			-		59,774

Footnotes related to the three months ended September 30, 2016, segment results (in millions):
(1)	Corporate SG&A	$	(12.6)
	Company-wide equity-based compensation		(6.1)
	Profit sharing		(21.0)
	Other, net		(8.0)
		$	(47.7)

			Metals		Steel
For the nine months ended	Steel		Recycling		Fabrication
September 30, 2017	Operations		Operations		Operations		Other			Eliminations		Consolidated
Net Sales
External	$	5,025,310	$	910,830	$	603,140	$	281,091		$	-	$	6,820,371
External Non-U.S.		237,070		144,750		127		-			-		381,947
Other segments		183,374		1,067,770		244		1,065			(1,252,453)		-
		5,445,754		2,123,350		603,511		282,156			(1,252,453)		7,202,318
Operating income (loss)		895,008		51,968		65,735		(141,406)	(1)		(371)		870,934
Income (loss) before income taxes		830,865		46,674		61,171		(164,456)			(371)		773,883
Depreciation and amortization		170,125		37,048		8,743		8,152			-		224,068
Capital expenditures		101,939		18,539		5,748		1,520			-		127,746

Footnotes related to the nine months ended September 30, 2017, segment results (in millions):
(1)	Corporate SG&A	$	(37.9)
	Company-wide equity-based compensation		(23.5)
	Profit sharing		(66.8)
	Other, net		(13.2)
		$	(141.4)

Note 9.  Segment Information (Continued)

			Metals		Steel
For the nine months ended	Steel		Recycling		Fabrication
September 30, 2016	Operations		Operations		Operations		Other			Eliminations			Consolidated
Net Sales
External	$	4,068,688	$	769,260	$	527,859	$	210,358		$	-		$	5,576,165
External Non-U.S.		172,694		117,299		167		188			-			290,348
Other segments		178,190		756,613		2,415		3,603			(940,821)			-
		4,419,572		1,643,172		530,441		214,149			(940,821)			5,866,513
Operating income (loss)		712,939		20,014		73,230		(125,186)	(1)		(9,055)	(2)		671,942
Income (loss) before income taxes		645,189		10,300		67,175		(152,296)			(9,055)			561,313
Depreciation and amortization		159,614		42,666		8,431		12,413			(154)			222,970
Capital expenditures		103,202		17,068		1,918		980			-			123,168

Footnotes related to the nine months ended September 30, 2016, segment results (in millions):
(1)	Corporate SG&A	$	(38.5)	(2)	Gross profit decrease from intra-company sales	$	(9.1)
	Company-wide equity-based compensation		(20.4)
	Profit sharing		(47.7)
	Other, net		(18.6)
		$	(125.2)