10. Segment Information

The Company’s reportable segments are Performance Materials, Thermal/Acoustical Metals, and Thermal/Acoustical Fibers. The Performance Materials segment reports the results of the Company’s Filtration, Thermal Insulation, and Life Sciences Filtration businesses. The Thermal/Acoustical Metals segment reports the results of the Company’s metal-based automotive business. The Thermal/Acoustical Fibers segment reports the results of the Company’s fiber-based automotive business. Other Products and Services (“OPS”) includes Life Sciences Vital Fluids.

Performance Materials Segment

The Performance Materials segment includes filtration media solutions for air, fluid power, and industrial applications (“Filtration”), air and liquid life science applications (“Life Sciences Filtration”), and thermal insulation solutions for building products, appliances, and energy and industrial markets (“Thermal Insulation”). Filtration products include LydAir® MG (Micro-Glass) Air Filtration Media, LydAir® MB (Melt Blown) Air Filtration Media, LydAir® SC (Synthetic Composite) Air Filtration Media, and Arioso^TM Membrane Composite Media. These products constitute the critical media components of clean-air systems for applications in clean-space, commercial, industrial and residential HVAC, power generation, and industrial processes. Lydall has leveraged its extensive technical expertise and applications knowledge into a suite of media products covering the vast liquid filtration landscape across the engine and industrial fields. The LyPore® Liquid Filtration Media series address a variety of application needs in fluid power, including hydraulic filters, air-water and air-oil coalescing, industrial fluid processes and diesel fuel filtration.

Life Sciences Filtration products have been developed to meet the requirements of life science applications, including biopharmaceutical pre-filtration and clarification, diagnostic and analytical testing, respiratory protection, life protection, medical air filtration, drinking water filtration and high purity process filtration such as that found in food and beverage and medical applications. Lydall also offers Solupor® Membrane specialty microporous membranes that are utilized in various markets and applications, including air and liquid filtration and transdermal drug delivery. Solupor® membranes are made from ultra-high molecular weight polyethylene and incorporate a unique combination of mechanical strength, chemical inertness, and high porosity in a unique open structure.

Thermal Insulation products are high performance non-woven veils, papers, mats and specialty composites for the building products, appliance, and energy and industrial fields. The Manniglas® Thermal Insulation brand is diverse in its product application, ranging from high temperature seals and gaskets in ovens to specialty veils for HVAC and cavity wall insulation. The appLY® Needled Glass Mats have been developed to expand Lydall’s high temperature technology portfolio for broad application into the appliance market and supplements the Lytherm® Insulation Media product brand, traditionally utilized in the industrial market for kilns and furnaces used in metal processing. Lydall’s Cryotherm^® Super-Insulating Media, CRS-Wrap® Super-Insulating Media and Cryo-Lite^TM Cryogenic Insulation products are industry standards for state-of-the-art cryogenic insulation designs used by manufacturers of cryogenic equipment for liquid gas storage, piping, and transportation.

Thermal/Acoustical Metals Segment

The Thermal/Acoustical Metals segment offers a full range of innovative engineered products to assist in noise and heat abatement within the transportation sector. Lydall products are found in the underbody (tunnel, fuel tank, exhaust, rear muffler, and spare tire) and under hood (engine compartment, turbo charger, and manifolds) of cars, trucks, SUVs, heavy duty trucks and recreational vehicles.

Thermal/Acoustical Metals segment products are stamped metal combinations which provide thermal and acoustical shielding solutions for the global automotive and truck markets. Thermal/Acoustical Metals products include AMS^® which is an all metal shield designed to be used in various vehicle applications, and Direct Exhaust Mount Heat shields, which are mounted to high temperature surfaces like exhaust down-pipes or engine manifolds using aluminized and stainless steel with high performance heat absorbing metals. Additionally, a patented CLD (constraint layer damped) material is a lightweight material with characteristics to reduce vibration and parasitic noise on powertrain mounted heat shields.

Thermal/Acoustical Fibers Segment

The Thermal/Acoustical Fibers segment offers a line of innovative engineered products to assist in noise and heat abatement within the transportation sector. Lydall products are found in the interior (dash insulators), underbody (wheel well, fuel tank, and exhaust) and under hood (engine compartment) of cars, vans, trucks, SUVs, heavy duty trucks and recreational vehicles.

Thermal/Acoustical Fibers segment products offer thermal and acoustical insulating solutions comprised of organic and inorganic fiber composites for the automotive and truck markets primarily in North America. Lydall’s dBCore^® composite is a lightweight acoustical composite that emphasizes absorption principles over heavy-mass type systems. Lydall’s dBLyte®is a high-performance acoustical barrier with sound absorption and blocking properties and can be used throughout a vehicle’s interior to minimize intrusive noise from an engine compartment and road. Lydall’s ZeroClearance^® barrier is an innovative thermal solution that utilizes an adhesive backing for attachment and is ideal for protecting floor sheet metal from excessive exhaust heat. Lydall’s specially engineered wheel wells provide a solution with weight reduction and superior noise suppression capabilities over conventional designs.

Thermal/Acoustical Metals segment and Thermal/Acoustical Fibers segment operating results include allocations of certain costs shared between the segments.

Other Products and Services

The Life Sciences Vital Fluids business offers specialty products for blood filtration devices, blood transfusion single-use containers and the design and manufacture of single-use solutions for cell growth, frozen storage and fluid handling, as well as equipment for bioprocessing applications.

Net sales by segment and for OPS, as well as reconciling items, to equal to consolidated net sales for the years ended December 31, 2013, 2012, and 2011 were as follows:

Consolidated Net Sales	For the Years Ended December 31,
In thousands	2013		2012		2011
Performance Materials Segment:
Filtration	$	64,752	$	68,379	$	72,888
Thermal Insulation		36,929		38,449		47,299
Life Sciences Filtration		10,320		11,207		13,872
Performance Materials Segment net sales		112,001		118,035		134,059
Thermal/Acoustical Metals Segment
Metal parts		135,833		136,276		142,646
Tooling		22,573		17,645		13,290
Thermal/Acoustical Metals Segment net sales		158,406		153,921		155,936
Thermal/Acoustical Fibers Segment:
Fiber parts		105,876		93,519		79,631
Tooling		8,444		917		2,116
Thermal/Acoustical Fibers Segment net sales		114,320		94,436		81,747
Other Products and Services:
Life Sciences Vital Fluids		17,175		16,853		14,670
Other Products and Services net sales		17,175		16,853		14,670
Eliminations and Other		(3,933)		(4,321)		(2,824)
Consolidated Net Sales	$	397,969	$	378,924	$	383,588

Operating income from continuing operations by segment and for OPS and Corporate Office Expenses for the years ended December 31, 2013, 2012, and 2011 were as follows:

Operating Income from Continuing Operations	For the Years Ended December 31,
In thousands	2013		2012		2011
Performance Materials Segment	$	9,462	$	10,400	$	18,194
Thermal/Acoustical Metals Segment		14,088		14,708		15,915
Thermal/Acoustical Fibers Segment		21,486		12,851		(3,055)
Other Products and Services:
Life Sciences Vital Fluids		778		1,190		(1,040)
Corporate Office Expenses		(17,101)		(17,771)		(13,826)
Consolidated Operating Income from Continuing Operations	$	28,713	$	21,378	$	16,188

Operating results were impacted by a net gain on sale of a product line in the Performance Materials segment of $ 0.8 million in 2012 and $ 1.6 million in 2011 and a loss on disposal of assets in Corporate Office Expenses and the Performance Materials segment of $ 1.5 million and $ 0.3 million in 2012, respectively. Total assets by segment and for OPS and the Corporate Office were as follows at December 31, 2013, 2012 and 2011:

Total Assets	December 31,
In thousands	2013		2012		2011
Performance Materials Segment	$	74,838	$	74,119	$	71,379
Thermal/Acoustical Metals Segment		104,908		96,019		93,921
Thermal/Acoustical Fibers Segment		30,176		26,830		28,844
Other Products and Services		11,866		11,195		11,064
Corporate Office		52,897		43,753		29,977
Total Assets	$	274,685	$	251,916	$	235,185

Total capital expenditures and depreciation and amortization by segment and for OPS and the Corporate Office for the years ended December 31, 2013, 2012 and 2011 were as follows:

	Capital Expenditures						Depreciation and Amortization
In thousands	2013		2012		2011		2013		2012		2011
Performance Materials Segment	$	4,604	$	5,231	$	3,801	$	4,667	$	5,290	$	5,718
Thermal/Acoustical Metals Segment		6,027		4,063		2,413		4,777		5,019		5,210
Thermal/Acoustical Fibers Segment		1,887		1,033		1,148		2,217		2,324		2,536
Other Products and Services		243		128		270		588		596		726
Corporate Office		1,065		949		1,252		344		343		288
Total	$	13,826	$	11,404	$	8,884	$	12,593	$	13,572	$	14,478

Net sales by geographic area for the years ended December 31, 2013, 2012 and 2011 and long-lived asset information by geographic area as of December 31, 2013, 2012, and 2011 were as follows:

	Net Sales						Long-Lived Assets
In thousands	2013		2012		2011		2013		2012		2011
United States	$	269,989	$	251,695	$	239,101	$	48,787	$	45,979	$	48,803
France		47,831		52,517		58,974		16,436		17,463		17,621
Germany		77,229		71,896		81,424		13,287		13,542		14,065
Other		2,920		2,816		4,089		1,815		1,024		1,280
Total	$	397,969	$	378,924	$	383,588	$	80,325	$	78,008	$	81,769

Foreign sales are based on the country in which the sales originated (i.e., where the Company’s legal entity is domiciled). Sales to Ford Motor Company in 2013, 2012, and 2011 were $ 79.7 million, $ 71.2 million, and $ 62.2 million respectively and accounted for 20.0%, 18.8%, and 16.2% of Lydall’s net sales in the years ended December 31, 2013, 2012, and 2011, respectively. Sales to Chrysler Group LLC in 2013 and 2012 were $ 43.5 million and $ 38.0 million, respectively and accounted for 10.9% and 10.0% of Lydall’s net sales in the years ended December 31, 2013 and 2012, respectively. These sales were reported in the Thermal/Acoustical Metal and Thermal/Acoustical Fiber segments. No other customers accounted for more than 10.0% of total net sales in 2013, 2012, and 2011.