Segment Information |
Segment Information We use the management approach to identify operating segments. We organize our business around differences in regulatory environment and/or products or services, and the operating results of each segment are regularly reviewed by the chief operating decision maker (our Chief Executive Officer) in order to make decisions about resources and to assess performance. The segments are evaluated based on their pre-tax operating income. Our operations comprise three operating segments: | | • | Regulated Energy. The regulated energy segment includes natural gas distribution, electric distribution and natural gas transmission operations. All operations in this segment are regulated, as to their rates and services, by the PSC having jurisdiction in each operating territory or by the FERC in the case of Eastern Shore. |
| | • | Unregulated Energy. The unregulated energy segment includes natural gas marketing, propane distribution and propane wholesale marketing operations, which are unregulated as to their rates and charges for their services. |
| | • | Other. The “other” segment consists primarily of the advanced information services operation, unregulated subsidiaries that own real estate leased to Chesapeake and certain corporate costs not allocated to other operations. |
The following table presents financial information about our reportable segments. | | | | | | | | | | | | | | | | | | | | Three Months | | Six Months | For the Periods Ended June 30, | | 2013 | | 2012 | | 2013 | | 2012 | (in thousands) | | | | | | | | | Operating Revenues, Unaffiliated Customers | | | | | | | | | Regulated Energy | | $ | 54,975 |
| | $ | 55,253 |
| | $ | 136,279 |
| | $ | 127,271 |
| Unregulated Energy | | 34,273 |
| | 24,253 |
| | 89,264 |
| | 69,140 |
| Other | | 4,898 |
| | 4,391 |
| | 9,331 |
| | 8,400 |
| Total operating revenues, unaffiliated customers | | $ | 94,146 |
| | $ | 83,897 |
| | $ | 234,874 |
| | $ | 204,811 |
| Intersegment Revenues (1) | | | | | | | | | Regulated Energy | | $ | 241 |
| | $ | 300 |
| | $ | 504 |
| | $ | 578 |
| Unregulated Energy | | 1,752 |
| | 923 |
| | 1,752 |
| | 923 |
| Other | | 227 |
| | 221 |
| | 470 |
| | 456 |
| Total intersegment revenues | | $ | 2,220 |
| | $ | 1,444 |
| | $ | 2,726 |
| | $ | 1,957 |
| Operating Income | | | | | | | | | Regulated Energy | | $ | 8,619 |
| | $ | 10,505 |
| | $ | 25,925 |
| | $ | 25,303 |
| Unregulated Energy | | 447 |
| | (401 | ) | | 9,816 |
| | 4,753 |
| Other and eliminations | | 86 |
| | 351 |
| | (39 | ) | | 472 |
| Total operating income | | 9,152 |
| | 10,455 |
| | 35,702 |
| | 30,528 |
| Other income, net of other expenses | | 24 |
| | 153 |
| | 312 |
| | 349 |
| Interest | | 2,016 |
| | 2,241 |
| | 4,088 |
| | 4,532 |
| Income before Income Taxes | | 7,160 |
| | 8,367 |
| | 31,926 |
| | 26,345 |
| Income taxes | | 2,804 |
| | 3,307 |
| | 12,701 |
| | 10,558 |
| Net Income | | $ | 4,356 |
| | $ | 5,060 |
| | $ | 19,225 |
| | $ | 15,787 |
|
| | (1) | All significant intersegment revenues are billed at market rates and have been eliminated from consolidated operating revenues. |
| | | | | | | | | | (in thousands) | | June 30, 2013 | | December 31, 2012 | Identifiable Assets | | | | | Regulated energy | | $ | 658,171 |
| | $ | 615,438 |
| Unregulated energy | | 92,838 |
| | 79,287 |
| Other | | 28,649 |
| | 39,021 |
| Total identifiable assets | | $ | 779,658 |
| | $ | 733,746 |
|
Our operations are almost entirely domestic. Our advanced information services subsidiary, BravePoint, has infrequent transactions in foreign countries, which are denominated and paid primarily in U.S. dollars. These transactions are immaterial to the consolidated revenues. |