Segment Information (Text Block)

9 Months Ended

Sep. 30, 2012

Segment Information [Abstract]

Segment Information [Text Block]

Segment Information

As part of the global reorganization we announced in the first quarter of 2011, Itron is now managed and reports under two operating segments, Energy and Water. A transition to the new organizational structure, including changes to operations and financial and operational management systems, was completed in the first quarter of 2012. Therefore, financial reporting as of and for the three and nine months ended September 30, 2012 is based on the new operating segments, Energy and Water. Prior period segment information has been recast to reflect our new operating segments.

The Energy operating segment includes our global electricity and gas businesses, while the Water operating segment includes our global water and heat businesses.

We have three measures of segment performance: revenue, gross profit (margin), and operating income (margin). Our operating segments have distinct products, and therefore intersegment revenues are minimal. Corporate operating expenses, interest income, interest expense, other income (expense), and income tax provision (benefit) are not allocated to the segments, nor included in the measure of segment profit or loss. In addition, we allocate only certain production assets and intangible assets to our operating segments. We do not manage the performance of the segments on a balance sheet basis.

Segment Products

Energy

Standard electricity (electromechanical and electronic) and gas meters; advanced electricity and gas meters and communication modules; smart electricity meters; smart electricity and gas communication modules; prepayment systems, including smart key, keypad, and smart card communication technologies; advanced systems including handheld, mobile, and fixed network collection technologies; smart network technologies; meter data management software; knowledge application solutions; and professional services including implementation, installation, consulting, and analysis.

Water

Standard water and heat meters; advanced and smart water meters and communication modules; advanced systems including handheld, mobile, and fixed network collection technologies; meter data management software; knowledge application solutions; and professional services including implementation, installation, consulting, analysis, and system management.

Revenues, gross profit, and operating income associated with our segments were as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
	(in thousands)
Revenues
Energy	$	377,489		$	483,748		$	1,259,834		$	1,389,979
Water	126,574			131,807			395,009			401,668
Total Company	$	504,063		$	615,555		$	1,654,843		$	1,791,647
Gross profit
Energy	$	125,503		$	144,120		$	409,057		$	426,457
Water	46,294			32,876			142,590			127,468
Total Company	$	171,797		$	176,996		$	551,647		$	553,925
Operating income (loss)
Energy	$	30,978		$	(166,197	)	$	116,211		$	(77,566	)
Water	22,293			(321,191		)	49,896			(290,582		)
Corporate unallocated	(7,304		)	(9,864		)	(34,456		)	(30,930		)
Total Company	45,967			(497,252		)	131,651			(399,078		)
Total other income (expense)	(3,523		)	(12,043		)	(11,151		)	(38,041		)
Income (loss) before income taxes	$	42,444		$	(509,295	)	$	120,500		$	(437,119	)

One customer represented 10% of total Company revenues for the nine months ended September 30, 2012, while no customer represented more than 10% of total Company revenues during the three months ended September 30, 2012 and during the three and nine months ended September 30, 2011. One customer represented 11% and 13% of the Energy operating segment revenues in the three and nine months ended September 30, 2012, respectively, and one customer represented 10% and 11% of the Energy operating segment revenues in the three and nine months ended September 30, 2011, respectively. No single customer represented more than 10% of the Water operating segment revenues for the three and nine months ended September 30, 2012 and 2011.

Revenues by region were as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(in thousands)
United States and Canada	$	224,956	$	292,322	$	802,542	$	852,715
Europe, Middle East, and Africa	211,195		227,884		648,050		702,296
Other	67,912		95,349		204,251		236,636
Total revenues	$	504,063	$	615,555	$	1,654,843	$	1,791,647

Depreciation and amortization expense associated with our segments was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
	(in thousands)
Energy	$	20,452	$	24,246	$	61,596	$	72,169
Water	7,116		8,368		20,211		24,742
Corporate Unallocated	17		6		49		8
Total Company	$	27,585	$	32,620	$	81,856	$	96,919