Segment Reporting

We are an integrated agricultural enterprise, providing grain, foods and energy resources to businesses and consumers on a global basis. We provide a wide variety of products and services, from initial agricultural inputs such as fuels, farm supplies, crop nutrients and crop protection products, to agricultural outputs that include grains and oilseeds, grain and oilseed processing and food products, and the production and marketing of ethanol. We define our operating segments in accordance with ASC Topic 280, Segment Reporting, to reflect the manner in which our chief operating decision maker, our Chief Executive Officer, evaluates performance and allocates resources in managing the business. We have aggregated those operating segments into four reportable segments: Energy, Ag, Nitrogen Production and Foods.

Our Energy segment produces and provides primarily for the wholesale distribution of petroleum products and transportation of those products. Our Ag segment purchases and further processes or resells grains and oilseeds originated by our country operations business, by our member cooperatives and by third parties; serves as a wholesaler and retailer of crop inputs; and produces and markets ethanol. Our Nitrogen Production segment consists solely of our equity method investment in CF Nitrogen, which was completed in February 2016 and which entitles us, pursuant to a supply agreement that we entered into with CF Nitrogen, to purchase granular urea and UAN annually from CF Nitrogen to a specified annual quantity. The addition of the Nitrogen Production segment had no impact on historically reported segment results and balances as this segment came into existence in fiscal 2016. Our Foods segment consists solely of our equity method investment in Ventura Foods. In prior years Ventura Foods was reported as a component of Corporate and Other because it was an insignificant operating segment. Historically reported segment results and balances have been revised to reflect the addition of the Foods segment. There were no changes to the composition of our Energy or Ag segments as a result of the addition of the Nitrogen Production or Foods segments. Corporate and Other primarily represents our non-consolidated wheat milling operations, as well as our business solutions operations, which consists of commodities hedging, insurance and financial services related to crop production.

Corporate administrative expenses and interest are allocated to each business segment, and Corporate and Other, based on direct usage for services that can be tracked, such as information technology and legal, and other factors or considerations relevant to the costs incurred.

Prior to fiscal 2015, our renewable fuels marketing business was included in our Energy segment and our renewable fuels production business was included in our Ag segment. At the beginning of fiscal 2015, we reorganized certain parts of our business to better align our ethanol supply chain. As a result, our renewable fuels marketing business is now managed together with our renewable fuels production business within our Ag segment. Prior period segment information below has been revised to reflect this change to ensure comparability.

Many of our business activities are highly seasonal and operating results vary throughout the year. For example, in our Ag segment, our crop nutrients and country operations businesses generally experience higher volumes and income during the spring planting season and in the fall, which corresponds to harvest. Our grain marketing operations are also subject to fluctuations in volume and earnings based on producer harvests, world grain prices and demand. Our Energy segment generally experiences higher volumes and profitability in certain operating areas, such as refined products, in the summer and early fall when gasoline and diesel fuel usage is highest and is subject to global supply and demand forces. Other energy products, such as propane, may experience higher volumes and profitability during the winter heating and crop drying seasons.

Our revenues, assets and cash flows can be significantly affected by global market prices for commodities such as petroleum products, natural gas, grains, oilseeds, crop nutrients and flour. Changes in market prices for commodities that we purchase without a corresponding change in the selling prices of those products can affect revenues and operating earnings. Commodity prices are affected by a wide range of factors beyond our control, including the weather, crop damage due to disease or insects, drought, the availability and adequacy of supply, government regulations and policies, world events, and general political and economic conditions.

While our revenues and operating results are derived from businesses and operations which are wholly-owned and majority-owned, a portion of our business operations are conducted through companies in which we hold ownership interests of 50% or less and do not control the operations. We account for these investments primarily using the equity method of accounting, wherein we record our proportionate share of income or loss reported by the entity as equity income from investments, without consolidating the revenues and expenses of the entity in our Consolidated Statements of Operations. In our Ag segment, this principally includes our 50% ownership in TEMCO. In our Nitrogen Production segment, this consists of our 11.4% membership interest (based on product tons) in CF Nitrogen. In our Foods segment, this consists of our 50% ownership in Ventura Foods. In Corporate and Other, this principally includes our 12% ownership in Ardent Mills. See Note 4, Investments for more information on these entities.

Reconciling amounts represent the elimination of revenues between segments. Such transactions are executed at market prices to more accurately evaluate the profitability of the individual business segments.

Segment information for the years ended August 31, 2016, 2015 and 2014 is presented in the tables below. We have previously revised amounts for the year ended August 31, 2014 in the table below to include activity and amounts related to capital leases that were previously accounted for as operating leases. See Note 18, Correction of Immaterial Errors for more information on the nature and amounts of these revisions.



	Energy			Ag			Nitrogen Production			Foods			Corporate and Other			Reconciling Amounts			Total
	(Dollars in thousands)
For the year ended August 31, 2016:
Revenues	$	5,789,307		$	24,849,634		$	—		$	—		$	92,725		$	(384,463	)	$	30,347,203
Operating earnings	248,173			52,334			(6,193		)	(7,719		)	23,601			—			310,196
(Gain) loss on investments	—			(6,157		)	—			—			(3,095		)	—			(9,252		)
Interest expense, net	(22,531		)	35,199			34,437			2,692			25,550			—			75,347
Equity (income) loss from investments	(4,739		)	(7,644		)	(74,700		)	(75,175		)	(13,519		)	—			(175,777		)
Income before income taxes	$	275,443		$	30,936		$	34,070		$	64,764		$	14,665		$	—		$	419,878
Intersegment revenues	$	(341,765	)	$	(40,336	)	$	—		$	—		$	(2,362	)	$	384,463		$	—
Capital expenditures	$	376,841		$	260,865		$	—		$	—		$	55,074		$	—		$	692,780
Depreciation and amortization	$	193,525		$	230,172		$	—		$	—		$	23,795		$	—		$	447,492
Total assets as of August 31, 2016	$	4,306,297		$	7,002,916		$	2,796,323		$	369,487		$	2,842,686		$	—		$	17,317,709



	Energy			Ag			Foods			Corporate and Other			Reconciling Amounts			Total
	(Dollars in thousands)
For the year ended August 31, 2015:
Revenues	$	8,694,326		$	26,311,350		$	—		$	74,828		$	(498,062	)	$	34,582,442
Operating earnings	523,451			190,860			(1,454		)	2,555			—			715,412
(Gain) loss on investments	—			(2,875		)	—			(2,364		)	—			(5,239		)
Interest expense, net	(12,350		)	56,380			3,854			12,449			—			60,333
Equity (income) loss from investments	(2,330		)	(12,293		)	(67,955		)	(25,272		)	—			(107,850		)
Income before income taxes	$	538,131		$	149,648		$	62,647		$	17,742		$	—		$	768,168
Intersegment revenues	$	(483,989	)	$	(11,403	)	$	—		$	(2,670	)	$	498,062		$	—
Capital expenditures	$	696,825		$	417,950		$	—		$	72,015		$	—		$	1,186,790
Depreciation and amortization	$	148,292		$	192,438		$	—		$	14,692		$	—		$	355,422
Total assets as of August 31, 2015	$	4,624,471		$	7,814,689		$	347,748		$	2,441,404		$	—		$	15,228,312



	Energy			Ag			Foods			Corporate and Other			Reconciling Amounts			Total
For the year ended August 31, 2014:	(Dollars in thousands)
Revenues	$	12,181,212		$	31,022,507		$	—		$	73,827		$	(613,513	)	$	42,664,033
Operating earnings	793,924			249,944			(1,292		)	7,372			—			1,049,948
(Gain) loss on investments	—			(1,949		)	—			(112,213		)	—			(114,162		)
Interest expense, net	69,522			60,742			5,419			4,570			—			140,253
Equity (income) loss from investments	(4,014		)	(22,279		)	(55,104		)	(26,049		)	—			(107,446		)
Income before income taxes	$	728,416		$	213,430		$	48,393		$	141,064		$	—		$	1,131,303
Intersegment revenues	$	(600,433	)	$	(9,960	)	$	—		$	(3,120	)	$	613,513		$	—
Capital expenditures	$	539,170		$	329,613		$	—		$	50,293		$	—		$	919,076
Depreciation and amortization	$	137,408		$	157,102		$	—		$	11,737		$	—		$	306,247

We have international sales, which are predominantly in our Ag segment. The following table presents our sales, based on the geographic locations in which the sales originated, for the years ended August 31, 2016, 2015 and 2014:



	2016		2015		2014
	(Dollars in millions)
North America	$	23,276	$	27,821	$	38,287
South America	1,847		1,529		2,133
Europe, the Middle East and Africa (EMEA)	4,166		4,221		1,602
Asia Pacific (APAC)	1,058		1,011		642
Total	$	30,347	$	34,582	$	42,664