Note 9 — Segment Information

The financial results for our operating segments are prepared using a management approach, which is consistent with the basis and manner in which we internally segregate financial information for the purpose of assisting in making internal operating decisions. We evaluate the performance of our operating segments based on operating income, and generally account for intersegment sales based on arm’s length prices. Corporate and certain other expenses are not allocated to the operating segments, except to the extent that the expense can be directly attributable to the business segment.

Financial information for our operating segments for the quarters and six months ended June 30, 2017 and 2016 is as follows:

	(Unaudited)
	Composite		Engineered		Corporate &
(In millions	Materials		Products		Other (a)			Total
Second Quarter 2017
Net sales to external customers	$	397.3	$	94.0	$	—		$	491.3
Intersegment sales		15.1		—		(15.1	)		—
Total sales		412.4		94.0		(15.1	)		491.3
Operating income		92.1		12.1		(14.5	)		89.7
Depreciation and amortization		23.3		1.8		—			25.1
Stock-based compensation		1.2		0.2		1.0			2.4
Accrual basis additions to capital expenditures		74.5		2.7		—			77.2

Second Quarter 2016
Net sales to external customers	$	425.3	$	97.3	$	—		$	522.6
Intersegment sales		18.9		—		(18.9	)		—
Total sales		444.2		97.3		(18.9	)		522.6
Operating income		101.6		11.7		(13.2	)		100.1
Depreciation and amortization		21.4		1.8		0.1			23.3
Stock-based compensation		1.1		0.3		0.9			2.3
Accrual basis additions to capital expenditures		67.2		1.7		—			68.9

Six Months Ended June 30, 2017
Net sales to external customers	$	784.8	$	185.3	$	—		$	970.1
Intersegment sales		32.2		—		(32.2	)		—
Total sales		817.0		185.3		(32.2	)		970.1
Operating income		174.0		25.1		(30.8	)		168.3
Depreciation and amortization		45.8		3.7		—			49.5
Stock-based compensation		4.6		0.9		7.8			13.3
Accrual basis additions to capital expenditures		161.1		9.0		—			170.1

Six Months Ended June 30, 2016
Net sales to external customers	$	821.1	$	199.2	$	—		$	1,020.3
Intersegment sales		37.0		—		(37.0	)		—
Total sales		858.1		199.2		(37.0	)		1,020.3
Operating income		192.4		23.9		(32.3	)		184.0
Depreciation and amortization		41.8		3.6		0.1			45.5
Stock-based compensation		4.2		0.9		7.7			12.8
Accrual basis additions to capital expenditures		137.2		5.0		—			142.2
_________________

(a)

We do not allocate Corporate expenses to the operating segments

Goodwill and Intangible Assets

The carrying amount of gross goodwill and intangible assets by segment is as follows:

	June 30,		December 31,
(In millions)	2017		2016
Composite Materials	$	57.4	$	56.1
Engineered Products		16.1		16.1
Goodwill and intangible assets	$	73.5	$	72.2

No impairments have been recorded against these amounts.