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Business Segment Information
6 Months Ended
Jun. 30, 2016
Segment Reporting [Abstract]  
Business Segment Information

18.

Business Segment Information

The Company’s operations are organized and reviewed by management along its product lines and presented in three reportable segments.

Environmental Segment

Our Environmental segment, formerly known as the Air Pollution Control segment, provides the design and manufacture of product recovery and air pollution control technologies that enable our customers to meet compliance targets for toxic emissions, fumes, volatile organic compounds, process and industrial odors. These products and solutions include chemical and biological scrubbers, fabric filters and cartridge collectors, thermal and catalytic oxidation systems, cyclones, separators, gas absorbers and industrial ventilation systems. This segment also provides component parts for industrial air systems and provides cost effective alternatives to traditional duct components, as well as custom metal engineered fabrication services. These products and services are applicable to a wide variety of industries. During 2015, the Company concluded that changing the name of this segment was appropriate to more accurately describe the long-term goals of the Company in conjunction with the products and services offered within the segment.

Energy Segment

Our Energy segment provides customized solutions for the power and petrochemical industry. This includes gas turbine exhaust systems, dampers and diverters, gas and liquid separation and filtration equipment, selective catalytic reduction (“SCR”) and selective non-catalytic reduction (“SNCR”) systems, acoustical components and silencers, secondary separators (nuclear plant reactor vessels) and expansion joints, the design and manufacture of technologies for flue gas and diverter dampers, non-metallic expansion joints, natural gas turbine exhaust systems, and silencer and precipitator applications, primarily for coal-fired and natural gas power plants, refining, oil production and petrochemical processing, as well as a variety of other industries.

Fluid Handling and Filtration Segment

Our Fluid Handling and Filtration (“FHF”) segment provides the design and manufacture of high quality pump, filtration and fume exhaust solutions. This includes centrifugal pumps for corrosive, abrasive and high temperature liquids, filter products for air and liquid filtration, precious metal recovery systems, carbonate precipitators, and technologically advanced air movement and exhaust systems. These products are applicable to a wide variety of industries, particularly the aquarium/aquaculture, plating and metal finishing, food and beverage, chemical/petrochemical, wastewater treatment, desalination and pharmaceutical markets.

The accounting policies of the reporting segments are the same as those described in the summary of significant accounting policies in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC. Interest income and expense are not included in the measure of segment profit reviewed by management. Income taxes are also not included in the measure of segment operating profit reviewed by management. The operating results of the segments are reviewed through to the “Income from operations” line on the Condensed Consolidated Statements of Income.

The financial segment information is presented in the following tables:

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

(dollars in thousands)

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Net Sales (less intra-, inter-segment sales)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

44,211

 

 

$

41,798

 

 

$

83,333

 

 

$

83,514

 

Energy Segment

 

 

52,867

 

 

 

27,303

 

 

 

100,799

 

 

 

51,652

 

Fluid Handling and Filtration Segment

 

 

15,413

 

 

 

17,745

 

 

 

32,008

 

 

 

32,939

 

Corporate and Other(1)

 

 

(233

)

 

 

115

 

 

 

(707

)

 

 

(159

)

Net sales

 

$

112,258

 

 

$

86,961

 

 

$

215,433

 

 

$

167,946

 

 

(1)

Includes adjustment for revenue on intercompany jobs.

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

(dollars in thousands)

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Income from Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

6,119

 

 

$

5,140

 

 

$

10,865

 

 

$

9,158

 

Energy Segment

 

 

6,367

 

 

 

215

 

 

 

11,563

 

 

 

635

 

Fluid Handling and Filtration Segment

 

 

3,200

 

 

 

4,431

 

 

 

6,398

 

 

 

7,387

 

Corporate and Other(2)

 

 

(6,618

)

 

 

(5,074

)

 

 

(13,537

)

 

 

(8,891

)

Eliminations

 

 

(507

)

 

 

(224

)

 

 

(921

)

 

 

(822

)

Income from operations

 

$

8,561

 

 

$

4,488

 

 

$

14,368

 

 

$

7,467

 

 

(2)

Includes corporate compensation, professional services, information technology, acquisition and integration expenses, and other general and administrative corporate expenses.

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

(dollars in thousands)

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Property and Equipment Additions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

115

 

 

$

17

 

 

$

228

 

 

$

81

 

Energy Segment

 

 

220

 

 

 

139

 

 

 

304

 

 

 

179

 

Fluid Handling and Filtration Segment(3)

 

 

3,301

 

 

 

63

 

 

 

3,310

 

 

 

68

 

Corporate and Other

 

 

2

 

 

 

3

 

 

 

6

 

 

 

13

 

Property and equipment additions

 

$

3,638

 

 

$

222

 

 

$

3,848

 

 

$

341

 

 (3)

Includes noncash additions of $3,296 for property, plant, and equipment acquired under capital leases during the second quarter of 2016.  See Note 15 for further detail.

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

(dollars in thousands)

 

2016

 

 

2015

 

 

2016

 

 

2015

 

Depreciation and Amortization

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

907

 

 

$

1,104

 

 

$

1,874

 

 

$

2,257

 

Energy Segment

 

 

2,939

 

 

 

760

 

 

 

5,741

 

 

 

1,431

 

Fluid Handling and Filtration Segment

 

 

1,254

 

 

 

1,590

 

 

 

2,648

 

 

 

3,186

 

Corporate and Other

 

 

32

 

 

 

37

 

 

 

65

 

 

 

69

 

Depreciation and Amortization

 

$

5,132

 

 

$

3,491

 

 

$

10,328

 

 

$

6,943

 

 

(dollars in thousands)

 

June 30,

2016

 

 

December 31,

2015

 

Identifiable Assets

 

 

 

 

 

 

 

 

Environmental Segment

 

$

131,047

 

 

$

135,171

 

Energy Segment

 

 

270,196

 

 

 

283,002

 

Fluid Handling and Filtration Segment

 

 

161,378

 

 

 

161,394

 

Corporate and Other(4)

 

 

29,081

 

 

 

19,252

 

Identifiable Assets

 

$

591,702

 

 

$

598,819

 

 

(4)

Corporate assets primarily consist of cash and income tax related assets.

 

(dollars in thousands)

 

June 30,

2016

 

 

December 31,

2015

 

Goodwill

 

 

 

 

 

 

 

 

Environmental Segment

 

$

55,031

 

 

$

55,031

 

Energy Segment

 

 

72,587

 

 

 

72,075

 

Fluid Handling and Filtration Segment

 

 

93,057

 

 

 

93,057

 

Goodwill

 

$

220,675

 

 

$

220,163

 

 

Intra-segment and Inter-segment Revenues

The Company has multiple divisions that sell to each other within segments (intra-segment sales) and between segments (inter-segment sales) as indicated in the following tables:

 

 

 

Three Months Ended June 30, 2016

 

 

 

 

 

 

 

 

 

 

 

Less Inter-Segment Sales

 

 

 

 

 

(dollars in thousands)

 

Total

Sales

 

 

Intra-

Segment

Sales

 

 

Environmental

 

 

Energy

 

 

FHF

 

 

Corp

and

Other

 

 

Net Sales to

Outside

Customers

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

45,522

 

 

$

(844

)

 

$

 

 

$

(427

)

 

$

(40

)

 

$

 

 

$

44,211

 

Energy Segment

 

 

53,740

 

 

 

(654

)

 

 

(219

)

 

 

 

 

 

 

 

 

 

 

 

52,867

 

Fluid Handling and Filtration Segment

 

 

16,045

 

 

 

(452

)

 

 

(180

)

 

 

 

 

 

 

 

 

 

 

 

15,413

 

Corporate and Other(5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(233

)

 

 

(233

)

Net Sales

 

$

115,307

 

 

$

(1,950

)

 

$

(399

)

 

$

(427

)

 

$

(40

)

 

$

(233

)

 

$

112,258

 

 

 

 

Three Months Ended June 30, 2015

 

 

 

 

 

 

 

 

 

 

 

Less Inter-Segment Sales

 

 

 

 

 

(dollars in thousands)

 

Total

Sales

 

 

Intra-

Segment

Sales

 

 

Environmental

 

 

Energy

 

 

FHF

 

 

Corp

and

Other

 

 

Net Sales to

Outside

Customers

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

43,833

 

 

$

(1,476

)

 

$

 

 

$

(559

)

 

$

 

 

$

 

 

$

41,798

 

Energy Segment

 

 

29,445

 

 

 

(1,560

)

 

 

(582

)

 

 

 

 

 

 

 

 

 

 

 

27,303

 

Fluid Handling and Filtration Segment

 

 

18,459

 

 

 

(699

)

 

 

(15

)

 

 

 

 

 

 

 

 

 

 

 

17,745

 

Corporate and Other(5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

115

 

 

 

115

 

Net Sales

 

$

91,737

 

 

$

(3,735

)

 

$

(597

)

 

$

(559

)

 

$

 

 

$

115

 

 

$

86,961

 

 

 

 

Six Months Ended June 30, 2016

 

 

 

 

 

 

 

 

 

 

 

Less Inter-Segment Sales

 

 

 

 

 

(dollars in thousands)

 

Total

Sales

 

 

Intra-

Segment

Sales

 

 

Environmental

 

 

Energy

 

 

FHF

 

 

Corp

and

Other

 

 

Net Sales to

Outside

Customers

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

87,575

 

 

$

(2,598

)

 

$

 

 

$

(1,467

)

 

$

(177

)

 

$

 

 

$

83,333

 

Energy Segment

 

 

102,321

 

 

 

(1,145

)

 

 

(377

)

 

 

 

 

 

 

 

 

 

 

 

100,799

 

Fluid Handling and Filtration Segment

 

 

33,057

 

 

 

(855

)

 

 

(194

)

 

 

 

 

 

 

 

 

 

 

 

32,008

 

Corporate and Other(5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(707

)

 

 

(707

)

Net Sales

 

$

222,953

 

 

$

(4,598

)

 

$

(571

)

 

$

(1,467

)

 

$

(177

)

 

$

(707

)

 

$

215,433

 

 

 

 

Six Months Ended June 30, 2015

 

 

 

 

 

 

 

 

 

 

 

Less Inter-Segment Sales

 

 

 

 

 

(dollars in thousands)

 

Total

Sales

 

 

Intra-

Segment

Sales

 

 

Environmental

 

 

Energy

 

 

FHF

 

 

Corp

and

Other

 

 

Net Sales to

Outside

Customers

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Environmental Segment

 

$

87,390

 

 

$

(3,283

)

 

$

 

 

$

(593

)

 

$

 

 

$

 

 

$

83,514

 

Energy Segment

 

 

54,526

 

 

 

(2,255

)

 

 

(619

)

 

 

 

 

 

 

 

 

 

 

$

51,652

 

Fluid Handling and Filtration Segment

 

 

34,193

 

 

 

(1,151

)

 

 

(103

)

 

 

 

 

 

 

 

 

 

 

$

32,939

 

Corporate and Other(5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(159

)

 

 

(159

)

Net Sales

 

$

176,109

 

 

$

(6,689

)

 

$

(722

)

 

$

(593

)

 

$

-

 

 

$

(159

)

 

$

167,946

 

 

(5)

Includes adjustment for revenue on intercompany jobs.