Business Segment Information

3 Months Ended

Mar. 31, 2014

Business Segment Information

Note 2—Business segment information:

Business segment	Entity	% controlled at March 31, 2014
Chemicals	Kronos	80	%
Component products	CompX	87	%
Waste management	WCS	100	%
Real estate management and development	BMI and LandWell	63% - 77	%

Our control of Kronos includes 50% we hold directly and 30% held directly by NL. We own 83% of NL. Our control of CompX is through NL. Our control of LandWell includes the 27% we hold directly and 50% held by BMI.  

	Three months ended March 31,
	2013			2014
	(unaudited)
Net sales:
Chemicals	$	463.6		$	420.1
Component products		21.5			25.8
Waste management		14.1			7.0
Real estate management and development		—			9.5
Total net sales	$	499.2		$	462.4
Cost of sales:
Chemicals	$	460.3		$	340.2
Component products		15.5			18.0
Waste management		10.5			10.7
Real estate management and development		—			7.7
Total cost of sales	$	486.3		$	376.6
Gross margin:
Chemicals	$	3.3		$	79.9
Component products		6.0			7.8
Waste management		3.6			(3.7	)
Real estate management and development		—			1.8
Total gross margin	$	12.9		$	85.8
Operating income (loss):
Chemicals	$	(45.1	)	$	27.6
Component products		1.5			3.3
Waste management		(1.6	)		(8.5	)
Real estate management and development		—			.4
Total operating income (loss)		(45.2	)		22.8
Equity in earnings of investees		(.3	)		—
General corporate items:
Securities earnings		6.6			6.8
Insurance recoveries		.6			.8
Loss on prepayment of debt		(6.6	)		—
General expenses, net		(9.7	)		(8.3	)
Interest expense		(15.4	)		(13.7	)
Income (loss) before income taxes	$	(70.0	)	$	8.4

Segment results we report may differ from amounts separately reported by our various subsidiaries and affiliates due to purchase accounting adjustments and related amortization or differences in the way we define operating income. Intersegment sales are not material.  Our Real Estate Management and Development Segment consists of BMI and LandWell.  We acquired a controlling interest in BMI and LandWell in December 2013, see Note 3.  We commenced consolidating the results of operations and cash flows of BMI and LandWell beginning January 1, 2014.