Segment Information

6 Months Ended

Jun. 29, 2014

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company operates in two principal reportable business segments: Kratos Government Solutions ("KGS") and Public Safety & Security ("PSS"). The Company organizes its reportable business segments based on the nature of the services offered.

Revenues, depreciation and amortization, and operating income generated by the Company’s current reportable segments for the three and six month periods ended June 30, 2013 and June 29, 2014 are as follows (in millions):

	Three Months Ended					Six Months Ended
	June 30, 2013		June 29, 2014			June 30, 2013			June 29, 2014
Revenues:
Kratos Government Solutions
Service revenues	$	58.5	$	51.2		$	123.9		$	102.9
Product sales	125.0		114.5			262.3			214.0
Total Kratos Government Solutions	183.5		165.7			386.2			316.9
Public Safety & Security
Service revenues	51.7		50.6			102.3			99.5
Product sales	—		13.0			—			13.0
Total Public Safety & Security	51.7		63.6			102.3			112.5
Total revenues	$	235.2	$	229.3		$	488.5		$	429.4
Depreciation & amortization:
Kratos Government Solutions	$	12.7	$	9.2		$	25.9		$	18.3
Public Safety & Security	0.9		0.5			1.9			1.0
Total depreciation and amortization	$	13.6	$	9.7		$	27.8		$	19.3
Operating income:
Kratos Government Solutions	$	5.3	$	5.3		$	17.4		$	9.4
Public Safety & Security	2.7		3.0			3.9			4.0
Unallocated corporate expense, net	0.9		(3.6		)	(1.0		)	(5.4		)
Total operating income	$	8.9	$	4.7		$	20.3		$	8.0

Total operating income of the reportable business segments is reconciled to the corresponding consolidated amount. The reconciling item “Unallocated corporate expense, net” includes costs for certain stock-based compensation programs, the effects of items not considered part of management’s evaluation of segment operating performance, merger and acquisition expenses, corporate costs not allocated to the operating segments, and other miscellaneous corporate activities. Transactions between segments are generally negotiated and accounted for under terms and conditions similar to other government and commercial contracts.