15. INDUSTRY SEGMENT INFORMATION

The Company operates primarily in two industry groups, HVAC and Construction Products. The Company has identified two reportable segments in each of the two industry groups: the Heating and Cooling segment and the Evaporative Cooling segment in the HVAC industry group and the CACS segment and the Door segment in the Construction Products industry group. The Heating and Cooling segment primarily produces and sells gas-fired wall furnaces, console heaters and fan coils from the Company’s wholly-owned subsidiary, WFC of Colton, California. The Evaporative Cooling segment primarily produces and sells evaporative coolers from the Company’s wholly-owned subsidiary, PMI of Phoenix, Arizona. Sales of these two segments are nationwide, but are concentrated in the southwestern United States. Concrete, aggregates and construction supplies are offered by the CACS segment from numerous locations along the Southern portion of the Front Range of Colorado operated by the Company’s wholly-owned subsidiaries collectively referred to as TMC. The Door segment sells hollow metal and wood doors, door frames and related hardwares, lavatory fixtures and electronic access and security systems from the Company’s wholly-owned subsidiary, MDHI, which operates out of facilities in Pueblo and Colorado Springs, Colorado. Sales of these latter two segments are highly concentrated in the Southern Front Range area in Colorado although door sales are also made throughout the United States.

The Company evaluates the performance of its segments and allocates resources to them based on a number of criteria including operating income, return on investment and other strategic objectives. Operating income is determined by deducting operating expenses from all revenues. In computing operating income, none of the following has been added or deducted: unallocated corporate expenses, interest, other income or loss or income taxes.

In addition to the above reporting segments, an “Unallocated Corporate” classification is used to report the unallocated expenses of the corporate office which provides treasury, insurance and tax services as well as strategic business planning and general management services. Expenses related to the corporate information technology group are allocated to all locations, including the corporate office.

The following table presents information about reported segments for the fiscal years 2017 and 2016 along with the items necessary to reconcile the segment information to the totals reported in the financial statements (amounts in thousands):


	Construction Products Industry						HVAC Industry
	Concrete,
	Aggregates &				Combined		Heating						Unallocated
	Construction				Construction		and		Evaporative		Combined		Corporate
	Supplies		Doors		Products		Cooling		Cooling		HVAC		(a)		Total
Year Ended December 30, 2017
Revenues from external customers	$	66,407	$	18,652	$	85,059	$	42,517	$	25,216	$	67,733	$	18	$	152,810
Depreciation, depletion and amortization		1,405		152		1,557		550		409		959		38		2,554
Operating income (loss)		2,656		1,861		4,517		2,140		(550)		1,590		(3,091)		3,016
Segment assets		39,020		7,360		46,380		21,543		11,896		33,439		2,670		82,489
Capital expenditures		4,566		135		4,701		804		230		1,034		46		5,781


	Construction Products Industry						HVAC Industry
	Concrete,
	Aggregates &				Combined		Heating						Unallocated
	Construction				Construction		and		Evaporative		Combined		Corporate
	Supplies		Doors		Products		Cooling		Cooling		HVAC		(a)		Total
Year Ended December 31, 2016
Revenues from external customers	$	67,091	$	16,990	$	84,081	$	41,853	$	25,642	$	67,495	$	16	$	151,592
Depreciation, depletion and amortization		1,340		134		1,474		526		413		939		23		2,436
Operating income (loss)		3,433		1,563		4,996		3,046		1,413		4,459		(3,614)		5,841
Segment assets		33,518		6,173		39,691		22,381		12,283		34,664		3,653		78,008
Capital expenditures		3,296		110		3,406		655		182		837		162		4,405

(a)

Includes unallocated corporate office expenses and assets which consist primarily of cash and cash equivalents, prepaid expenses, property, plant and equipment.

There are no differences in the basis of segmentation or in the basis of measurement of segment profit or loss from the last annual report.