Business Segment Information

12 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Business Segment Information

BUSINESS SEGMENT INFORMATION

Our business segments share a focus on industrial flow control technology and have a high number of common customers. These segments also have complementary product offerings and technologies that are often combined in applications that provide us a net competitive advantage. Our segments also benefit from our global footprint and our economies of scale in reducing administrative and overhead costs to serve customers more cost effectively.

We conduct our operations through these three business segments based on type of product and how we manage the business:

• EPD for long lead time, custom and other highly-engineered pumps and pump systems, mechanical seals, auxiliary systems and replacement parts and related services;

• IPD for engineered and pre-configured industrial pumps and pump systems and related products and services; and

• FCD for engineered and industrial valves, control valves, actuators and controls and related services.

For decision-making purposes, our Chief Executive Officer ("CEO") and other members of senior executive management use financial information generated and reported at the reportable segment level. Our corporate headquarters does not constitute a separate division or business segment. We evaluate segment performance and allocate resources based on each reportable segment’s operating income. Amounts classified as "Eliminations and All Other" include corporate headquarters costs and other minor entities that do not constitute separate segments. Intersegment sales and transfers are recorded at cost plus a profit margin, with the sales and related margin on such sales eliminated in consolidation.

The following is a summary of the financial information of our reportable segments as of and for the years ended December 31, 2017, 2016 and 2015 reconciled to the amounts reported in the consolidated financial statements.

								Subtotal—Reportable Segments		Eliminations and All Other			Consolidated Total
	EPD		IPD			FCD
	(Amounts in thousands)
Year Ended December 31, 2017:
Sales to external customers		$1,738,082	$	739,656		$	1,183,093	$	3,660,831	$	—		$	3,660,831
Intersegment sales	37,347		35,552			5,018		77,917		(77,917		)	—
Segment operating income (loss)	156,830		(49,475		)	321,230		428,585		(93,163		)	335,422
Depreciation and amortization	48,659		28,864			27,278		104,801		13,653			118,454
Identifiable assets	1,956,638		1,028,255			1,317,944		4,302,837		607,637			4,910,474
Capital expenditures	19,790		8,368			16,626		44,784		16,818			61,602

								Subtotal—Reportable Segments		Eliminations and All Other			Consolidated Total
	EPD		IPD			FCD
	(Amounts in thousands)
Year Ended December 31, 2016:
Sales to external customers		$1,963,086	$	799,923		$	1,227,478	$	3,990,487	$	—		$	3,990,487
Intersegment sales	32,873		35,156			6,234		74,263		(74,263		)	—
Segment operating income (loss)	167,420		(6,370		)	198,620		359,670		(91,705		)	267,965
Depreciation and amortization	48,957		28,824			28,189		105,970		10,782			116,752
Identifiable assets	2,082,729		1,010,107			1,310,273		4,403,109		305,814			4,708,923
Capital expenditures	29,426		17,336			26,467		73,229		16,470			89,699

							Subtotal—Reportable Segments		Eliminations and All Other			Consolidated Total
	EPD		IPD		FCD
	(Amounts in thousands)
Year Ended December 31, 2015:
Sales to external customers	$	2,209,809	$	937,756	$	1,410,226	$	4,557,791	$	—		$	4,557,791
Intersegment sales	46,821		44,137		5,276		96,234		(96,234		)	—
Segment operating income	319,980		29,128		233,616		582,724		(68,059		)	514,665
Depreciation and amortization	50,289		36,826		30,404		117,519		9,568			127,087
Identifiable assets	2,230,134		1,056,400		1,323,758		4,610,292		352,814			4,963,106
Capital expenditures	88,496		19,446		63,569		171,511		10,350			181,861

Geographic Information — We attribute sales to different geographic areas based on the facilities’ locations. Long-lived assets are classified based on the geographic area in which the assets are located and exclude deferred taxes, goodwill and intangible assets. Prior period information has been updated to conform to current year presentation. Sales and long-lived assets by geographic area are as follows:

	Year Ended December 31, 2017
	Sales		Percentage		Long-Lived Assets		Percentage
	(Amounts in thousands, except percentages)
United States	$	1,460,899	40.0	%	$	333,126	38.2	%
EMA(1)	1,434,506		39.2	%	321,256		36.9	%
Asia(2)	471,054		12.9	%	148,757		17.1	%
Other(3)	294,372		7.9	%	68,379		7.8	%
Consolidated total	$	3,660,831	100.0	%	$	871,518	100.0	%

	Year Ended December 31, 2016
	Sales		Percentage		Long-Lived Assets		Percentage
	(Amounts in thousands, except percentages)
United States	$	1,537,779	38.5	%	$	338,038	37.2	%
EMA(1)	1,541,984		38.6	%	288,903		31.8	%
Asia(2)	500,424		12.5	%	144,599		15.9	%
Other(3)	410,300		10.4	%	136,391		15.1	%
Consolidated total	$	3,990,487	100.0	%	$	907,931	100.0	%

	Year Ended December 31, 2015
	Sales		Percentage		Long-Lived Assets		Percentage
	(Amounts in thousands, except percentages)
United States	$	1,679,075	36.9	%	$	338,556	34.4	%
EMA(1)	1,773,281		38.9	%	326,728		33.2	%
Asia(2)	562,792		12.3	%	143,767		14.6	%
Other(3)	542,643		11.9	%	173,706		17.8	%
Consolidated total	$	4,557,791	100.0	%	$	982,757	100.0	%

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(1) "EMA" includes Europe, the Middle East and Africa. In 2017, 2016 and 2015, Germany accounted for approximately 10%, 10% and 11%, respectively, of consolidated long-lived assets. No other individual country within this group represents 10% or more of consolidated totals for any period presented.

(2) "Asia" includes Asia and Australia. No individual country within this group represents 10% or more of consolidated totals for any period presented.

(3) "Other" includes Canada and Latin America. No individual country within this group represents 10% or more of consolidated totals for any period presented.

Net sales to international customers, including export sales from the U.S., represented approximately 64% of total sales in 2017 and 2016 and 66% in 2015.

Major Customer Information — We have a large number of customers across a large number of manufacturing and service facilities and do not believe that we have sales to any individual customer that represent 10% or more of consolidated sales for any of the years presented.