Segment Information

9 Months Ended

Sep. 30, 2011

Segment Information

Segment Information

Note 11—Segment Information

        The Company's reportable segments are strategic business units arranged geographically which have separate management teams. The business units have been aggregated into three reportable segments following the Western Coal acquisition described in Note 1. These reportable segments are U.S. Operations, Canadian and U.K. Operations, and Other. Both the U.S. Operations and Canadian and U.K. Operations reportable segments primary business is that of mining and exporting metallurgical for the steel industry. Beginning in the second quarter of 2011 the Company reports its U.S. operations under the U.S. Operations segment which includes Walter Energy's historical operating segments of Underground Mining, Surface Mining and Walter Coke as well as the results, since the date of acquisition, of the West Virginia mining operations acquired through the acquisition of Western Coal on April 1, 2011. The Company reports the results of its mining operations acquired through the Western Coal acquisition located in Northeast British Columbia (Canada) and South Wales (United Kingdom) under the Canadian and U.K. Operations segment, since the April 1, 2011 date of acquisition. The Other segment primarily includes corporate expenses. Previously reported segment amounts have been restated to conform to the current period presentation.

        The accounting policies of the segments are the same as those described in Note 2 of the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form-10K for the fiscal year ended December 31, 2010. The Company evaluates performance primarily based on operating income of the respective business segments.

        Summarized financial information of the Company's reportable segments is shown in the following table (in thousands):

			For the three months ended September 30,
			2011			2010
Revenues:
	U.S. Operations		$	467,130		$	463,478
	Canadian and U.K. Operations			222,681			—
	Other			258			784
		Total Revenues	$	690,069		$	464,262
Segment operating income (loss):
	U.S. Operations		$	112,867		$	215,518
	Canadian and U.K. Operations			50,195			—
	Other			(14,412	)		(7,731	)
	Operating income			148,650			207,787
	Less interest expense, net			(27,602	)		(4,004	)
	Other loss			(13,143	)		—
	Income from continuing operations before income tax expense			107,905			203,783
	Income tax expense			31,684			66,811
		Income from continuing operations	$	76,221		$	136,972
Depreciation and depletion:
	U.S. Operations		$	46,732		$	25,733
	Canadian and U.K. Operations			16,124			—
	Other			190			172
		Total	$	63,046		$	25,905
Capital Expenditures:
	U.S. Operations		$	41,435		$	35,147
	Canadian and U.K. Operations			115,426			—
	Other			99			43
		Total	$	156,960		$	35,190

			For the nine months ended September 30,
			2011			2010
Revenues:
	U.S. Operations		$	1,381,918		$	1,184,783
	Canadian and U.K. Operations			488,256			—
	Other			1,629			2,150
		Total Revenues	$	1,871,803		$	1,186,933
Segment operating income (loss):
	U.S. Operations		$	420,511		$	477,010
	Canadian and U.K. Operations			62,643			—
	Other			(61,088	)		(27,683	)
	Operating income			422,066			449,327
	Less interest expense, net			(62,889	)		(12,487	)
	Other income, net			11,360			—
	Income from continuing operations before income tax expense			370,537			436,840
	Income tax expense			105,145			141,063
		Income from continuing operations	$	265,392		$	295,777
Depreciation and depletion:
	U.S. Operations		$	114,170		$	71,623
	Canadian and U.K. Operations			66,089			—
	Other			571			336
		Total	$	180,830		$	71,959
Capital Expenditures:
	U.S. Operations		$	126,543		$	76,008
	Canadian and U.K. Operations			166,837			—
	Other			(3	)		4,222
		Total	$	293,377		$	80,230

			September 30, 2011		December 31, 2010
Identifiable Assets:
	U.S. Operations		$	1,141,890	$	1,021,534
	Canadian and U.K. Operations			5,537,155		—
	Other			492,902		636,231
		Total	$	7,171,947	$	1,657,765