15. OPERATING SEGMENTS

The Company’s organizational structure consists of global business unit and global regional leadership teams. The Company’s operating segments follow its commercial and product-based activities and are based on engagement in business activities, availability of discrete financial information and review of operating results by the Chief Operating Decision Maker at the identified operating segment level.

The Company’s operating segments that share similar economic characteristics and future prospects, nature of the products and production processes, end-use markets, channels of distribution and regulatory environment have been aggregated into three reportable segments: Global Industrial, Global Institutional and Global Energy. The Company’s operating segments that do not meet the quantitative criteria to be separately reported have been combined into the Other segment. The Company provides similar information for the Other segment as the Company considers the information regarding its underlying operating segments as useful in understanding its consolidated results.

Comparability of Reportable Segments

Refer to Note 17 for additional information regarding adoption of new accounting standards for the changes presented in the “Revenue Standard Adoption” and “Pension Standard Adoption” columns in the table below.

Effective in the first quarter of 2018, the Company established the Colloidal Technologies Group (“CTG”) operating segment. The CTG operating segment has not been aggregated, based on qualitative criteria, and is included in Other. CTG produces and sells colloidal silica, which is comprised of nano-sized particles of silica in water; these products and associated programs are used primarily for binding and polishing applications. CTG was previously recorded in the Water operating segment which is aggregated into the Global Industrial reportable segment. The Company also made insignificant changes to its reportable segments, including the movement of certain customers and cost allocations between reportable segments. These changes are presented in "Segment Change" column of the table below.

The Company evaluates the performance of its non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminates the impact of exchange rate fluctuations on its international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. Fixed currency rates are generally based on existing market rates at the time they are established. The “Fixed Currency Rate Change” column shown in the following table reflects the impact on previously reported values related to fixed currency exchange rates established by management at the beginning of 2018.

The impact of the preceding changes on previously reported full year 2017 reportable segment net sales and operating income is summarized as follows:


	December 31, 2017
	2017 Reported		Revenue		Pension				Fixed	2017 Revised
	Valued at 2017		Standard		Standard		Segment		Currency	Valued at 2018
(millions)	Management Rates		Adoption		Adoption		Change		Rate Change	Management Rates
Net Sales
Global Industrial		$4,878.5		$(0.8)		$-		$(56.9)	$286.0	$5,106.8
Global Institutional		4,744.9		(1.4)		-		(23.7)	190.2	4,910.0
Global Energy		3,199.3		-		-		0.7	81.7	3,281.7
Other		823.5		-		-		79.9	28.1	931.5
Subtotal at fixed currency rates		13,646.2		(2.2)		-		-	586.0	14,230.0
Effect of foreign currency translation		192.1		(0.2)		-		-	(586.0)	(394.1)
Consolidated reported GAAP net sales		$13,838.3		$(2.4)		$-		$-	$-	$13,835.9

Operating Income
Global Industrial		$722.0		$(0.8)		$(12.8)		$2.6	$47.5	$758.5
Global Institutional		985.7		(1.4)		(13.1)		(14.9)	23.5	979.8
Global Energy		338.5		-		(16.7)		(0.7)	15.0	336.1
Other		149.3		-		(24.5)		13.0	4.7	142.5
Corporate		(208.6)		-		-		-	(5.3)	(213.9)
Subtotal at fixed currency rates		1,986.9		(2.2)		(67.1)		-	85.4	2,003.0
Effect of foreign currency translation		32.9		(0.2)		(0.2)		-	(85.4)	(52.9)
Consolidated reported GAAP operating income		$2,019.8		$(2.4)		$(67.3)		$-	$-	$1,950.1

Reportable Segment Information

Financial information for each of the Company’s reportable segments, including the impact of all preceding segment structure changes, is as follows:


	Third Quarter Ended				Nine Months Ended
	September 30				September 30
(millions)	2018		2017		2018		2017
Net Sales
Global Industrial		$1,411.6		$1,309.4		$4,001.4		$3,754.7
Global Institutional		1,340.8		1,268.9		3,870.5		3,646.3
Global Energy		889.6		817.5		2,590.7		2,406.6
Other		232.9		247.6		652.6		711.6
Subtotal at fixed currency rates		3,874.9		3,643.4		11,115.2		10,519.2
Effect of foreign currency translation		(127.7)		(78.9)		(207.5)		(332.3)
Consolidated reported GAAP net sales		$3,747.2		$3,564.5		$10,907.7		$10,186.9

Operating Income
Global Industrial		$224.9		$217.4		$527.9		$529.4
Global Institutional		292.5		276.1		743.2		720.0
Global Energy		94.1		89.8		256.4		232.8
Other		48.3		41.4		114.7		102.7
Corporate		(122.1)		(48.2)		(246.1)		(202.9)
Subtotal at fixed currency rates		537.7		576.5		1,396.1		1,382.0
Effect of foreign currency translation		(21.5)		(12.4)		(31.0)		(41.1)
Consolidated reported GAAP operating income		$516.2		$564.1		$1,365.1		$1,340.9

The profitability of the Company’s operating segments is evaluated by management based on operating income. The Company has no intersegment revenues.

Consistent with the Company’s internal management reporting, Corporate amounts in the table above include amortization specifically from the Nalco merger and special (gains) and charges, as discussed in Note 2, that are not allocated to the Company’s reportable segments.