Segment Disclosures

Our reportable segments are strategic business units that offer different products and services. Our segments are managed separately as each segment requires different marketing strategies and business knowledge. Management evaluates performance based on segment operating margin, which includes revenue from affiliates and external customers, operating expenses, cost of product sales and earnings of non-controlled entities.

We believe that investors benefit from having access to the same financial measures used by management. Operating margin, which is presented in the following tables, is an important measure used by management to evaluate the economic performance of our core operations. Operating margin is not a GAAP measure, but the components of operating margin are computed using amounts that are determined in accordance with GAAP. A reconciliation of operating margin to operating profit, which is its nearest comparable GAAP financial measure, is included in the tables below. Operating profit includes depreciation and amortization expense and G&A expense that management does not consider when evaluating the core profitability of our separate operating segments.



	Three Months Ended March 31, 2017
	(in thousands)
	Refined Products			Crude Oil			Marine Storage			Intersegment Eliminations			Total
Transportation and terminals revenue	$	241,905		$	105,053		$	46,407		$	(694	)	$	392,671
Product sales revenue	240,170			3,103			2,347			—			245,620
Affiliate management fee revenue	329			3,134			320			—			3,783
Total revenue	482,404			111,290			49,074			(694		)	642,074
Operating expenses	93,533			27,418			12,655			(2,014		)	131,592
Cost of product sales	167,681			2,577			2,618			—			172,876
Earnings of non-controlled entities	(111		)	(20,650		)	(685		)	—			(21,446		)
Operating margin	221,301			101,945			34,486			1,320			359,052
Depreciation and amortization expense	26,966			10,856			8,156			1,320			47,298
G&A expense	24,901			10,039			5,341			—			40,281
Operating profit	$	169,434		$	81,050		$	20,989		$	—		$	271,473



	Three Months Ended March 31, 2018
	(in thousands)
	Refined Products			Crude Oil			Marine Storage			Intersegment Eliminations			Total
Transportation and terminals revenue	$	260,394		$	126,258		$	46,200		$	(915	)	$	431,937
Product sales revenue	232,774			6,439			2,379			—			241,592
Affiliate management fee revenue	297			4,016			937			—			5,250
Total revenue	493,465			136,713			49,516			(915		)	678,779
Operating expenses	94,049			33,591			17,964			(2,308		)	143,296
Cost of product sales	190,333			7,050			2,209			—			199,592
Earnings of non-controlled entities	(2,318		)	(31,608		)	(612		)	—			(34,538		)
Operating margin	211,401			127,680			29,955			1,393			370,429
Depreciation and amortization expense	28,907			12,762			8,817			1,393			51,879
G&A expense	28,887			11,906			5,763			—			46,556
Operating profit	$	153,607		$	103,012		$	15,375		$	—		$	271,994