Business Segments

3 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Business Segments

Business Segments

The company operates in four primary business segments: NA/HME, IPG, Europe and Asia/Pacific. Both the NA/HME and IPG segments operate in the Americas. The NA/HME segment sells each of the three primary product lines, which includes: lifestyle, mobility and seating, and respiratory therapy products. IPG sells long-term care medical equipment, health care furnishings and accessory products. Europe and Asia/Pacific sell product lines similar to those of NA/HME and IPG. The accounting policies of each segment are the same as those described in the summary of significant accounting policies for the company’s consolidated financial statements. Intersegment sales and transfers are based on the costs to manufacture plus a reasonable profit element.

Segment performance is measured and resources are allocated based on a number of factors, with the primary profit or loss measure being segment operating profit (loss). Segment operating profit

(loss) represents net sales less cost of products sold less selling general and administrative expenses. Segment operating profit (loss) excludes unallocated corporate general and administrative expenses not allocated to the segments and intersegment sales and profit eliminations, which are included in All Other. In addition, segment operating profit (loss) further excludes charges related to restructuring activities, asset impairments and gain on sale of business (as applicable).

Segment operating income (loss), is used by the CODM for purposes of making decisions about allocating resources to a segment and assessing its performance. In addition, this metric is reviewed by the company’s Board of Directors regarding segment performance and is a key metric in the performance management assessment of the company's employees.

(in thousands)	For the Three Months Ended March 31,
	2018			2017
Revenues from external customers
Europe	$	131,314		$	119,508
NA/HME	79,782			84,262
IPG	14,887			16,373
Asia/Pacific	11,077			11,580
Consolidated	$	237,060		$	231,723
Intersegment revenues
Europe	$	3,857		$	3,675
NA/HME	23,503			22,095
IPG	89			768
Asia/Pacific	5,660			3,860
Consolidated	$	33,109		$	30,398
Restructuring charges before income taxes
Europe	$	293		$	690
NA/HME	97			2,242
Asia/Pacific	11			351
Consolidated	$	401		$	3,283
Operating income (loss)
Europe	$	6,594		$	5,100
NA/HME	(8,138		)	(9,426		)
IPG	1,598			1,898
Asia/Pacific	972			(430		)
All Other	(5,773		)	(4,510		)
Charge expense related to restructuring activities	(401		)	(3,283		)
Consolidated operating loss	(5,148		)	(10,651		)
Net gain on convertible debt derivatives	103			901
Net Interest expense	(6,713		)	(4,430		)
Loss before income taxes	$	(11,758	)	$	(14,180	)