Segment Information

12 Months Ended

Dec. 31, 2020

Segment Information

Note 3: Segment Information

Unitil reports three segments: utility gas operations, utility electric operations and non-regulated. Unitil’s principal business is the local distribution of electricity in the southeastern seacoast and state capital regions of New Hampshire and the greater Fitchburg area of north central Massachusetts and the local distribution of natural gas in southeastern New Hampshire, portions of southern Maine to the Lewiston-Auburn area and in the greater Fitchburg area of north central Massachusetts. Unitil has three distribution utility subsidiaries, Unitil Energy, which operates in New Hampshire, Fitchburg, which operates in Massachusetts and Northern Utilities, which operates in New Hampshire and Maine.

Granite State is an interstate natural gas transmission pipeline company, operating 86 miles of underground gas transmission pipeline primarily located in Maine and New Hampshire. Granite State provides Northern Utilities with interconnection to three major natural gas pipelines and access to domestic natural gas supplies in the south and Canadian natural gas supplies in the north. Granite State derives its revenues principally from the transmission services provided to Northern Utilities and, to a lesser extent, third-party marketers. Granite State is included in the utility gas operations segment.

Unitil Resources is the Company’s wholly-owned non-regulated subsidiary. Usource, Inc. and Usource L.L.C. (collectively, Usource), which the Company divested of in the first quarter of 2019, were wholly-owned subsidiaries of Unitil Resources. Usource provided brokering and advisory services to large commercial and industrial customers in the northeastern United States. Unitil Realty and Unitil Service provide centralized facilities, operations and administrative services to support the affiliated Unitil companies. Unitil Resources and Usource are included in the Non-Regulated segment.

Unitil Realty, Unitil Service and the holding company are included in Other. Unitil Service provides centralized management and administrative services, including information systems management and financial record keeping. Unitil Realty owns certain real estate, principally the Company’s corporate headquarters. The earnings of the holding company are principally derived from income earned on short-term investments and real property owned for Unitil and its subsidiaries’ use.

The segments follow the same accounting policies as described in the Summary of Significant Accounting Policies. Intersegment sales take place at cost and the effects of all intersegment and/or intercompany transactions are eliminated in the consolidated financial statements. Segment profit or loss is based on profit or loss from operations after income taxes and preferred stock dividends. Expenses used to determine operating income before taxes are charged directly to each segment or are allocated based on cost allocation factors included in rate applications approved by the FERC, NHPUC, MDPU, and MPUC. Assets allocated to each segment are based upon specific identification of such assets provided by Company records.

The following tables provide significant segment financial data for the years ended December 31, 2020, 2019 and 2018 (millions):

Year Ended December 31, 2020	Gas			Electric			Non- Regulated		Other			Total
Revenues:
Billed and Unbilled Revenue	$	185.2		$	226.7		$	—	$	—		$	411.9
Rate Adjustment Mechanism Revenue		6.2			0.5			—		—			6.7
Total Operating Revenues		191.4			227.2			—		—			418.6
Interest Income		1.1			1.1			—		0.4			2.6
Interest Expense		14.2			8.7			—		3.5			26.4
Depreciation & Amortization Expense		29.8			23.8			—		0.9			54.5
Income Tax Expense (Benefit)		7.3			4.7			—		(1.8	)		10.2
Segment Profit		19.3			12.9			—		—			32.2
Segment Assets		886.3			571.8			—		19.8			1,477.9
Capital Expenditures		71.1			45.5			—		6.0			122.6
Year Ended December 31, 2019
Revenues:
Billed and Unbilled Revenue	$	212.1		$	223.1		$	—	$	—		$	435.2
Rate Adjustment Mechanism Revenue		(8.7	)		10.8			—		—			2.1
Other Operating Revenue—Non-Regulated		—			—			0.9		—			0.9
Total Operating Revenues		203.4			233.9			0.9		—			438.2
Interest Income		1.2			0.9			0.2		0.6			2.9
Interest Expense		14.4			9.4			—		2.8			26.6
Depreciation & Amortization Expense		28.5			22.6			—		0.9			52.0
Income Tax Expense (Benefit)		7.2			4.2			3.8		(1.4	)		13.8
Segment Profit		19.1			11.5			10.2		3.4			44.2
Segment Assets		823.3			529.3			0.3		17.9			1,370.8
Capital Expenditures		74.0			39.6			—		5.6			119.2
Year Ended December 31, 2018
Revenues:
Billed and Unbilled Revenue	$	210.7		$	228.7		$	—	$	—		$	439.4
Rate Adjustment Mechanism Revenue		5.4			(5.4	)		—		—			—
Other Operating Revenue—Non-Regulated		—			—			4.7		—			4.7
Total Operating Revenues		216.1			223.3			4.7		—			444.1
Interest Income		0.8			0.8			0.2		0.6			2.4
Interest Expense		14.2			9.0			—		3.2			26.4
Depreciation & Amortization Expense		24.9			23.1			0.1		2.3			50.4
Income Tax Expense (Benefit)		7.1			4.2			0.5		(3.4	)		8.4
Segment Profit		18.8			11.4			1.3		1.5			33.0
Segment Assets		764.1			484.2			6.9		43.1			1,298.3
Capital Expenditures		70.8			28.4			—		3.2			102.4