Note 9 — Disclosures about Segments

Cleco’s reportable segment is based on its method of internal reporting, which disaggregates business units by its first-tier subsidiary.

Cleco Power, the reportable segment, engages in business activities from which it earns revenue and incurs expenses. Segment managers report periodically to Cleco’s CEO with discrete financial information and, at least quarterly, present discrete financial information to Cleco and Cleco Power’s Boards of Managers. The reportable segment prepares budgets that are presented to and approved by Cleco and Cleco Power’s Boards of Managers. The column shown as Other in the chart below includes the holding company, a shared services subsidiary, two transmission interconnection facility subsidiaries, and an investment subsidiary.

The financial results of Cleco’s segment are presented on an accrual basis. Management evaluates the performance of its segment and allocates resources to it based on segment profit and the requirements to implement new strategic initiatives and projects to meet current business objectives. Material intercompany transactions occur on a regular basis. These intercompany transactions relate primarily to joint and common administrative support services.



SEGMENT INFORMATION FOR THE THREE MONTHS ENDED SEPT. 30,
2017 (THOUSANDS)	CLECO POWER			OTHER			ELIMINATIONS			CONSOLIDATED
Revenue
Electric operations	$	320,009		$	(2,420	)	$	—		$	317,589
Other operations	20,768			514			—			21,282
Electric customer credits	(372		)	—			—			(372		)
Affiliate revenue	209			13,517			(13,726		)	—
Operating revenue, net	$	340,614		$	11,611		$	(13,726	)	$	338,499
Depreciation and amortization	$	40,049		$	2,179		$	—		$	42,228
Merger transaction and commitment costs	$	—		$	185		$	—		$	185
Interest charges	$	17,141		$	13,331		$	(10	)	$	30,462
Interest income	$	332		$	31		$	(9	)	$	354
Federal and state income tax expense (benefit)	$	30,092		$	(7,038	)	$	—		$	23,054
Net income (loss)	$	54,852		$	(9,548	)	$	—		$	45,304



2016 (THOUSANDS)	CLECO POWER		OTHER			ELIMINATIONS			CONSOLIDATED
Revenue
Electric operations	$	326,281	$	(2,574	)	$	—		$	323,707
Other operations	18,460		517			(1		)	18,976
Electric customer credits	177		—			—			177
Affiliate revenue	213		13,060			(13,273		)	—
Operating revenue, net	$	345,131	$	11,003		$	(13,274	)	$	342,860
Depreciation and amortization	$	40,353	$	2,182		$	—		$	42,535
Merger transaction and commitment costs	$	—	$	1,869		$	—		$	1,869
Interest charges	$	19,177	$	12,709		$	(28	)	$	31,858
Interest income	$	264	$	82		$	(28	)	$	318
Federal and state income tax expense (benefit)	$	29,427	$	(5,728	)	$	1		$	23,700
Net income (loss)	$	52,572	$	(12,952	)	$	1		$	39,621



SEGMENT INFORMATION FOR THE NINE MONTHS ENDED SEPT. 30,
	SUCCESSOR
2017 (THOUSANDS)	CLECO POWER			OTHER			ELIMINATIONS			CONSOLIDATED
Revenue
Electric operations	$	847,417		$	(8,337	)	$	—		$	839,080
Other operations	58,083			1,544			—			59,627
Electric customer credits	(1,045		)	—			—			(1,045		)
Affiliate revenue	649			41,882			(42,531		)	—
Operating revenue, net	$	905,104		$	35,089		$	(42,531	)	$	897,662
Depreciation and amortization	$	118,280		$	6,351		$	(1	)	$	124,630
Merger transaction and commitment costs	$	—		$	187		$	—		$	187
Interest charges	$	52,654		$	40,297		$	(151	)	$	92,800
Interest income	$	926		$	271		$	(151	)	$	1,046
Federal and state income tax expense (benefit)	$	63,010		$	(20,629	)	$	—		$	42,381
Net income (loss)	$	108,439		$	(31,398	)	$	—		$	77,041
Additions to property, plant, and equipment	$	183,604		$	2,005		$	—		$	185,609
Equity investment in investees ⁽¹⁾	$	18,172		$	—		$	—		$	18,172
Goodwill ⁽¹⁾	$	1,490,797		$	—		$	—		$	1,490,797
Total segment assets ⁽¹⁾	$	5,822,302		$	592,681		$	(17,282	)	$	6,397,701
⁽¹⁾Balances as of September 30, 2017



	SUCCESSOR APR. 13, 2016 - SEPT. 30, 2016												PREDECESSOR JAN. 1, 2016 - APR. 12, 2016
2016 (THOUSANDS)	CLECO POWER			OTHER			ELIMINATIONS			CONSOLIDATED			CLECO POWER			OTHER			ELIMINATIONS			CONSOLIDATED
Revenue
Electric operations	$	558,439		$	(4,805	)	$	—		$	553,634		$	281,154		$	—		$	—		$	281,154
Other operations	32,145			965			—			33,110			18,493			587			—			19,080
Electric customer credits	(381		)	—			—			(381		)	(364		)	—			—			(364		)
Affiliate revenue	406			23,823			(24,229		)	—			263			15,024			(15,287		)	—
Operating revenue, net	$	590,609		$	19,983		$	(24,229	)	$	586,363		$	299,546		$	15,611		$	(15,287	)	$	299,870
Depreciation and amortization	$	71,498		$	5,198		$	(1	)	$	76,695		$	43,698		$	377		$	1		$	44,076
Merger transaction and commitment costs	$	151,501		$	21,671		$	—		$	173,172		$	—		$	34,928		$	(16	)	$	34,912
Interest charges	$	35,937		$	22,430		$	(44	)	$	58,323		$	21,840		$	295		$	(12	)	$	22,123
Interest income	$	382		$	177		$	(44	)	$	515		$	208		$	69		$	(12	)	$	265
Federal and state income tax (benefit) expense	$	(10,028	)	$	(18,474	)	$	—		$	(28,502	)	$	12,993		$	(9,525	)	$	—		$	3,468
Net (loss) income	$	(9,326	)	$	(32,968	)	$	—		$	(42,294	)	$	21,548		$	(25,508	)	$	—		$	(3,960	)
Additions to property, plant, and equipment	$	102,284		$	393		$	—		$	102,677		$	42,353		$	39		$	—		$	42,392
Equity investment in investees ⁽¹⁾	$	18,672		$	—		$	—		$	18,672
Goodwill ⁽¹⁾	$	1,490,797		$	—		$	—		$	1,490,797
Total segment assets ⁽¹⁾	$	5,758,245		$	614,959		$	(30,060	)	$	6,343,144
⁽¹⁾Balances as of December 31, 2016