Segment Information

9 Months Ended

Mar. 31, 2020

The accounting policies of the Company’s reportable segments are generally the same as those used to prepare the condensed consolidated financial statements. LIFO expense of $1,950 and $3,650 in the three months ended March 31, 2020 and 2019, respectively, and $4,237 and $7,997 in the nine months ended March 31, 2020 and 2019, respectively, is recorded in cost of sales in the condensed statements of income, and is included in operating income for the Service Center Based Distribution segment. The Company allocates LIFO expense between the segments in the fourth quarter of its fiscal year. Intercompany sales, primarily from the Fluid Power & Flow Control segment to the Service Center Based Distribution segment, of $7,685 and $7,328, in the three months ended March 31, 2020 and 2019, respectively, and $22,434 and $21,013 in the nine months ended March 31, 2020 and 2019, respectively, have been eliminated in the Segment Financial Information tables below.



Three Months Ended	Service Center Based Distribution		Fluid Power & Flow Control		Total
March 31, 2020
Net sales	$	574,368	$	256,429	$	830,797
Operating income for reportable segments	53,014		26,449		79,463
Depreciation and amortization of property	4,373		1,007		5,380
Capital expenditures	3,588		670		4,258

March 31, 2019
Net sales	$	630,438	$	255,005	$	885,443
Operating income for reportable segments	64,763		25,837		90,600
Depreciation and amortization of property	3,969		1,057		5,026
Capital expenditures	4,024		591		4,615



Nine Months Ended	Service Center Based Distribution		Fluid Power & Flow Control		Total
March 31, 2020
Net sales	$	1,753,316	$	767,260	$	2,520,576
Operating income for reportable segments	167,279		82,755		250,034
Assets used in business	1,310,754		978,775		2,289,529
Depreciation and amortization of property	12,831		3,166		15,997
Capital expenditures	14,022		2,201		16,223

March 31, 2019
Net sales	$	1,823,785	$	766,211	$	2,589,996
Operating income for reportable segments	185,889		85,960		271,849
Assets used in business	1,252,161		1,070,649		2,322,810
Depreciation and amortization of property	11,791		3,254		15,045
Capital expenditures	9,724		1,987		11,711

A reconciliation of operating income for reportable segments to the condensed consolidated income before income taxes is as follows:



	Three Months Ended						Nine Months Ended
	March 31,						March 31,
	2020			2019			2020			2019
Operating income for reportable segments	$	79,463		$	90,600		$	250,034		$	271,849
Adjustment for:
Intangible amortization—Service Center Based Distribution	3,811			2,794			9,697			10,785
Intangible amortization—Fluid Power & Flow Control	7,291			7,117			21,974			21,038
Intangible impairment—Service Center Based Distribution	—			31,594			—			31,594
Goodwill Impairment—Fluid Power & Flow Control	131,000			—			131,000			—
Corporate and other expense, net	15,311			14,586			45,402			46,619
Total operating (loss) income	(77,950		)	34,509			41,961			161,813
Interest expense, net	8,805			9,947			28,447			30,001
Other income, net	(1,428		)	(1,256		)	(1,643		)	(549		)
(Loss) income before income taxes	$	(85,327	)	$	25,818		$	15,157		$	132,361

The change in corporate and other expense, net is due to changes in corporate expenses, as well as in the amounts and levels of certain expenses being allocated to the segments. The expenses being allocated include corporate charges for working capital, logistics support and other items.