Operating Segments

9 Months Ended

Sep. 30, 2014

Operating Segments [Abstract]

Operating Segments

Note 3.  Operating Segments

Our six operating segments, Jones Act, Pure Car Truck Carriers, Dry Bulk Carriers, Rail-Ferry, Specialty Contracts, and Other are distinguished primarily by the market in which the segment assets are deployed, the physical characteristics of those assets, and the type of services provided to our customers. We report in the Other category the results of several of our subsidiaries that provide ship and cargo charter brokerage, ship management services and agency services to our operating subsidiaries as well as third party customers.  Also included in the Other category are corporate related items, results of insignificant operations, and income and expense items not allocated to the other reportable segments. We manage each reportable segment separately, as each requires different resources depending on the nature of the contract or terms under which the vessels within the segment operate. 

We allocate interest expense to the segments in proportion to the fixed assets (defined as the carrying value of vessels, property, and other equipment) within each segment.  Additionally, we include the results of two of our unconsolidated entities, Oslo Bulk, AS and  Oslo Bulk Holding Pte. Ltd, in our Dry Bulk Carriers segment, and the results of another unconsolidated entity, Terminales Transgolfo, S.A. de C.V., to our Rail-Ferry segment.  The results of our remaining unconsolidated entities, Saltholmen Shipping Ltd (a company owning two Chemical Tankers) and Brattholmen Shipping Ltd (a company owning two Asphalt Tankers), are included in our Specialty Contracts segment.  We do not allocate to our segments; (i) administrative and general expenses, (ii) (loss) gain on sale of other assets, (iii) derivative (income) loss, (iv) income taxes, (v) loss (gain) on sale of investment, (vi) other income from vessel financing, (vii) investment income, and (viii) foreign exchange loss (gain).  Intersegment revenues are based on market prices and include revenues earned by our subsidiaries that provide specialized services to our operating companies. Finally, we use “gross voyage profit” as the primary measure for our segments’ profitability to assist in monitoring and managing our business.

The following table presents information about segment profit and loss for the three months ended September 30, 2014 and 2013:

RESULTS OF OPERATIONS

three MONTHS ENDED September 30, 2014

COMPARED TO THE three MONTHS ENDED September 30, 2013

(All Amounts in Thousands)		Jones Act			Pure Car Truck Carriers			Dry Bulk Carriers			Rail-Ferry			Specialty Contracts			Other			Total
2014
Fixed Revenue	$	32,101		$	15,290		$	1,910		$	-		$	9,462		$	-		$	58,763
Variable Revenue		-			3,520			1,786			9,435			1,497			(591)			15,647
Total Revenue from External Customers		32,101			18,810			3,696			9,435			10,959			(591)			74,410
Intersegment Revenues(Eliminated)		-			-			-			-			-			(4,321)			(4,321)
Intersegment Expenses Eliminated		-			-			-			-			-			4,321			4,321
Voyage Expenses		25,340			16,199			2,933			7,940			10,351			(1,134)			61,629
Loss (Income) of Unconsolidated Entities		-			-			373			81			(278)			-			176
Gross Voyage Profit	$	6,761		$	2,611		$	390		$	1,414		$	886		$	543		$	12,605
Gross Voyage Profit Margin		21	%		14	%		11	%		15	%		8	%		92	%		17	%
2013
Fixed Revenue	$	31,003		$	14,843		$	919		$	-		$	7,928		$	-		$	54,693
Variable Revenue		-			7,990			4,634			10,419			227			(25)			23,245
Total Revenue from External Customers		31,003			22,833			5,553			10,419			8,155			(25)			77,938
Intersegment Revenues (Eliminated)		-			-			-			-			-			(5,519)			(5,519)
Intersegment Expenses Eliminated		-			-			-			-			-			5,519			5,519
Voyage Expenses		24,400			19,728			4,801			8,494			7,602			(193)			64,832
Loss of Unconsolidated Entities		-			-			315			45			-			-			360
Gross Voyage Profit	$	6,603		$	3,105		$	437		$	1,880		$	553		$	168		$	12,746
Gross Voyage Profit Margin		21	%		14	%		8	%		18	%		7	%		(672)	%		16	%

The following table presents information about segment profit and loss for the nine months ended September 30, 2014 and 2013:

RESULTS OF OPERATIONS

NINE MONTHS ENDED September 30, 2014

COMPARED TO THE NINE MONTHS ENDED September 30, 2013

(All Amounts in Thousands)		Jones Act			Pure Car Truck Carriers			Dry Bulk Carriers			Rail-Ferry			Specialty Contracts			Other			Total
2014
Fixed Revenue	$	94,408		$	46,200		$	5,194		$	-		$	26,650		$	-		$	172,452
Variable Revenue		-			11,319			8,881			27,101			4,624			(521)			51,404
Total Revenue from External Customers		94,408			57,519			14,075			27,101			31,274			(521)			223,856
Intersegment Revenues(Eliminated)		-			-			-			-			-			(12,963)			(12,963)
Intersegment Expenses Eliminated		-			-			-			-			-			12,963			12,963
Voyage Expenses		77,370			50,355			9,992			22,874			28,826			(1,831)			187,586
Loss (Income) of Unconsolidated Entities		-			-			542			148			(326)			-			364
Gross Voyage Profit	$	17,038		$	7,164		$	3,541		$	4,079		$	2,774		$	1,310		$	35,906
Gross Voyage Profit Margin		18	%		12	%		25	%		15	%		9	%		(252)	%		16	%
2013
Fixed Revenue	$	90,581		$	48,043		$	2,457		$	-		$	21,519		$	-		$	162,600
Variable Revenue		-			27,755			12,183			29,115			2,253			53			71,359
Total Revenue from External Customers		90,581			75,798			14,640			29,115			23,772			53			233,959
Intersegment Revenues (Eliminated)		-			-			-			-			-			(16,557)			(16,557)
Intersegment Expenses Eliminated		-			-			-			-			-			16,557			16,557
Voyage Expenses		72,106			63,574			14,688			23,894			22,100			(431)			195,931
Loss of Unconsolidated Entities		-			-			653			52			-			-			705
Gross Voyage Profit (Loss)	$	18,475		$	12,224		$	(701)		$	5,169		$	1,672		$	484		$	37,323
Gross Voyage Profit Margin		20	%		16	%		(5)	%		18	%		7	%		913	%		16	%

The following table is a reconciliation of the totals reported for the operating segments to the applicable line items in the consolidated financial statements:

	Three Months Ended September 30,				Year to date as of September 30,
(All Amounts in Thousands)		2014		2013		2014		2013
Revenues	$	74,410	$	77,938	$	223,856	$	233,959
Voyage Expenses*		61,629		64,832		187,586		195,931
Net Loss of Unconsolidated Entities		176		360		364		705
Gross Voyage Profit		12,605		12,746		35,906		37,323
Vessel Depreciation		6,290		6,130		19,528		17,705
Other Depreciation		18		17		54		51
Gross Profit		6,297		6,599		16,324		19,567
Other Operating Expenses:
Administrative and General Expenses		5,398		4,994		16,209		16,597
Loss on Sale  of Other Assets		1		6		1		6
Less:  Net Loss of Unconsolidated Entities		(176)		(360)		(364)		(705)
Total Other Operating Expenses		5,223		4,640		15,846		15,898
Operating Income	$	1,074	$	1,959	$	478	$	3,669
* Includes Intangible Amortization