Reportable Segments

3 Months Ended

Mar. 29, 2020

Segment Reporting [Abstract]

Reportable Segments

Reportable Segments

We are organized around two global business platforms: Enterprise Solutions and Industrial Solutions. Each of the global business platforms represents a reportable segment.

Effective January 1, 2020, we transferred our West Penn Wire business and multi-conductor product lines from the Enterprise Solutions segment to the Industrial Solutions segment as a result of a shift in responsibilities among the segments. We have recast the prior period segment information to conform to the change in the composition of reportable segments.

The key measures of segment profit or loss are Segment Revenues and Segment EBITDA. Segment Revenues represent non-affiliate revenues and include revenues that would have otherwise been recorded by acquired businesses as independent entities but were not recognized in our Condensed Consolidated Statements of Operations and Comprehensive Income due to the effects of purchase accounting and the associated write-down of acquired deferred revenue to fair value. Segment EBITDA excludes certain items, including depreciation expense; amortization of intangibles; asset impairment; severance, restructuring, and acquisition integration costs; purchase accounting effects related to acquisitions, such as the adjustment of acquired

inventory and deferred revenue to fair value; and other costs. We allocate corporate expenses to the segments for purposes of measuring Segment EBITDA. Corporate expenses are allocated on the basis of each segment’s relative EBITDA prior to the allocation.

Our measure of segment assets does not include cash, goodwill, intangible assets, deferred tax assets, or corporate assets. All goodwill is allocated to reporting units of our segments for purposes of impairment testing. 

	Enterprise Solutions		Industrial Solutions		Total Segments
	(In thousands)
As of and for the three months ended March 29, 2020
Segment revenues	$	212,213	$	251,313	$	463,526
Affiliate revenues	224		6		230
Segment EBITDA	24,712		35,527		60,239
Depreciation expense	5,081		5,201		10,282
Amortization of intangibles	5,504		10,681		16,185
Amortization of software development intangible assets	55		275		330
Severance, restructuring, and acquisition integration costs	2,550		1,069		3,619
Purchase accounting effects of acquisitions	20		—		20
Segment assets	503,658		468,600		972,258
As of and for the three months ended March 31, 2019
Segment revenues	$	207,083	$	293,057	$	500,140
Affiliate revenues	1,544		17		1,561
Segment EBITDA	21,635		54,664		76,299
Depreciation expense	4,805		5,298		10,103
Amortization of intangibles	4,699		13,465		18,164
Amortization of software development intangible assets	36		23		59
Segment assets	447,707		531,440		979,147

The following table is a reconciliation of the total of the reportable segments’ Revenues and EBITDA to consolidated revenues and consolidated income from continuing operations before taxes, respectively. 

	Three Months Ended
	March 29, 2020		March 31, 2019
	(In thousands)
Total Segment and Consolidated Revenues	$	463,526	$	500,140
Total Segment EBITDA	$	60,239	$	76,299
Amortization of intangibles	(16,185)		(18,164)
Depreciation expense	(10,282)		(10,103)
Severance, restructuring, and acquisition integration costs (1)	(3,619)		—
Amortization of software development intangible assets	(330)		(59)
Purchase accounting effects related to acquisitions (2)	(20)		—
Eliminations	(95)		(483)
Consolidated operating income	29,708		47,490
Interest expense, net	(13,324)		(13,988)
Total non-operating pension benefit	699		603
Consolidated income from continuing operations before taxes	$	17,083	$	34,105

(1) See Note 11, Severance, Restructuring, and Acquisition Integration Activities, for details.

(2) During the three months ended March 29, 2020, we recognized cost of sales related to purchase accounting adjustments of acquired inventory to fair value for the SPC acquisition.