Note 2 – Business and geographic segments:

Our operating segments are defined as components of our operations about which separate financial information is available that is regularly evaluated by our chief operating decision maker in determining how to allocate resources and in assessing performance. At December 31, 2017, we had two reportable operating segments – Security Products and Marine Components.

The Security Products segment, with a facility in South Carolina and a facility shared with Marine Components in Illinois, manufactures locking mechanisms and other security products for sale to the transportation, postal, office and institutional furniture, cabinetry, tool storage, healthcare and other industries.

Our Marine Components segment, with a facility in Wisconsin and a facility shared with Security Products in Illinois, manufactures and distributes stainless steel exhaust systems, gauges and throttle controls primarily for recreational boats.

The chief operating decision maker evaluates segment performance based on segment operating income, which is defined as income before income taxes, exclusive of certain general corporate income and expense items (primarily interest income) and certain non-recurring items (such as gains or losses on the disposition of long-lived assets outside the ordinary course of business). The accounting policies of the reportable operating segments are the same as those described in Note 1. Capital expenditures include additions to property and equipment, but exclude amounts attributable to business combinations.

Segment assets are comprised of all assets attributable to the reportable segments. Corporate assets are not attributable to the operating segments and consist primarily of cash, cash equivalents and note receivable from affiliate. For geographic information, the point of origin (place of manufacture) for all net sales is the U.S., the point of destination for net sales is based on the location of the customer, and property and equipment are attributable to their physical location. Intersegment sales are not material.

	Years ended December 31,
	2015			2016			2017
	(In thousands)
Net sales:
Security Products	$	95,614		$	94,693		$	96,600
Marine Components		13,380			14,227			15,435
Total	$	108,994		$	108,920		$	112,035
Operating income (loss):
Security Products	$	18,585		$	19,981		$	19,182
Marine Components		1,433			1,707			1,342
Corporate		(6,047	)		(6,114	)		(5,289	)
Total operating income		13,971			15,574			15,235
Interest income		50			390			1,929

Income before income taxes	$	14,021		$	15,964		$	17,164


Depreciation and amortization:
Security Products	$	2,831	$	3,025	$	3,072
Marine Components		695		663		591
Corporate		10		10		10
Total	$	3,536	$	3,698	$	3,673
Capital expenditures:
Security Products	$	3,805	$	3,017	$	2,389
Marine Components		408		153		405
Corporate		5		5		2
Total	$	4,218	$	3,175	$	2,796


Net sales point of destination:
United States	$	103,737	$	98,526	$	103,646
Canada		2,352		7,515		5,353
Mexico		1,334		1,315		1,486
Other		1,571		1,564		1,550
Total	$	108,994	$	108,920	$	112,035

	December 31,
	2015		2016		2017
	(In thousands)
Total assets:
Security Products	$	72,561	$	73,345	$	72,961
Marine Components		12,761		12,209		11,704
Corporate and eliminations		49,470		58,426		66,294
Total	$	134,792	$	143,980	$	150,959

Net property and equipment for 2015, 2016 and 2017 is entirely located in the United States.