Reportable Segments

6 Months Ended

Jul. 02, 2023

Segment Reporting [Abstract]

Reportable Segments

Reportable Segments

We are organized around two global businesses: Enterprise Solutions and Industrial Automation Solutions. Each of the global businesses represents a reportable segment. The key measures of segment profit or loss are Segment Revenues and Segment EBITDA. Segment Revenues represent non-affiliate revenues. 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 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. Inter-company revenues between our segments is not material.

	Enterprise Solutions		Industrial Automation Solutions		Total Segments
	(In thousands)
As of and for the three months ended July 2, 2023
Segment Revenues	$	312,529	$	379,716	$	692,245
Segment EBITDA	43,956		78,631		122,587
Depreciation expense	6,193		6,489		12,682
Amortization of intangibles	6,208		4,918		11,126
Amortization of software development intangible assets	—		1,820		1,820
Severance, restructuring, and acquisition integration costs	1,669		2,390		4,059
Adjustments related to acquisitions and divestitures	325		(76)		249
Segment assets	648,344		699,092		1,347,436
As of and for the three months ended July 3, 2022
Segment Revenues	$	307,444	$	359,107	$	666,551
Segment EBITDA	41,887		68,060		109,947
Depreciation expense	5,768		5,602		11,370
Amortization of intangibles	4,442		4,735		9,177
Amortization of software development intangible assets	22		959		981
Severance, restructuring, and acquisition integration costs	4,575		1,282		5,857
Adjustments related to acquisitions and divestitures	(558)		1,134		576
Segment assets	607,386		649,595		1,256,981
As of and for the six months ended July 2, 2023
Segment revenues	$	587,872	$	746,162	$	1,334,034
Segment EBITDA	81,161		152,418		233,579
Depreciation expense	12,147		12,889		25,036
Amortization of intangibles	10,703		10,033		20,736
Amortization of software development intangible assets	—		3,272		3,272
Severance, restructuring, and acquisition integration costs	1,694		4,077		5,771
Adjustments related to acquisitions and divestitures	325		222		547
Segment assets	648,344		699,092		1,347,436
As of and for the six months ended July 3, 2022
Segment Revenues	$	575,874	$	701,048	$	1,276,922
Segment EBITDA	72,708		135,588		208,296
Depreciation expense	11,194		11,402		22,596
Amortization of intangibles	8,539		9,455		17,994
Amortization of software development intangible assets	44		1,944		1,988
Severance, restructuring, and acquisition integration costs	4,903		4,677		9,580
Adjustments related to acquisitions and divestitures	(558)		1,134		576
Segment assets	607,386		649,595		1,256,981

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				Six Months Ended
	July 2, 2023		July 3, 2022		July 2, 2023		July 3, 2022
	(In thousands)
Total Segment and Consolidated Revenues	$	692,245	$	666,551	$	1,334,034	$	1,276,922
Total Segment EBITDA	$	122,587	$	109,947	$	233,579	$	208,296
Depreciation expense	(12,682)		(11,370)		(25,036)		(22,596)
Amortization of intangibles	(11,126)		(9,177)		(20,736)		(17,994)
Severance, restructuring, and acquisition integration costs (1)	(4,059)		(5,857)		(5,771)		(9,580)
Amortization of software development intangible assets	(1,820)		(981)		(3,272)		(1,988)
Adjustments related to acquisitions and divestitures (2)	(249)		(576)		(547)		(576)
Eliminations	(54)		(50)		(83)		(105)
Consolidated operating income	92,597		81,936		178,134		155,457
Interest expense, net	(8,812)		(11,276)		(17,013)		(25,687)
Loss on debt extinguishment	—		—		—		(6,392)
Total non-operating pension benefit	646		1,070		1,134		2,270
Consolidated income from continuing operations before taxes	$	84,431	$	71,730	$	162,255	$	125,648

(1) Severance, restructuring, and acquisition integration costs for the three and six months ended July 2, 2023 and July 3, 2022 included costs related to our Acquisition Integration program. See Note 11.

(2) Adjustments related to acquisitions and divestitures included fair value adjustments of acquired inventory and investments as well as gains associated with the sales of businesses.