Segment Information

12 Months Ended

Sep. 30, 2013

Segment Information

Segment Information

Note 21.  Segment information

Woodward serves the aerospace market and the energy market through its two reportable segments - Aerospace and Energy.  Woodward’s reportable segments are aggregations of Woodward’s operating segments.  Woodward usesreportable segment information internally to manage its business, including the assessment of business segment performance and decisions for the allocation of resources between segments.

The accounting policies of the reportable segments are the same as those of the Company.  Woodward evaluates segment profit or loss based on internal performance measures for each segment in a given period.  In connection with that assessment, Woodward excludes matters such as charges for restructuring costs, interest income and expense, and certain gains and losses from asset dispositions. 

A summary of consolidated net sales and earnings by segment follows:

	Year Ended September 30,
	2013		2012		2011
Segment external net sales:
Aerospace	$	1,061,477	$	896,083	$	843,032
Energy		874,499		969,544		868,670
Total consolidated net sales	$	1,935,976	$	1,865,627	$	1,711,702
Segment earnings:
Aerospace	$	166,122	$	130,192	$	129,502
Energy		98,940		126,441		113,872
Total segment earnings		265,062		256,633		243,374
Nonsegment expenses		(39,061)		(33,365)		(30,942)
Interest expense, net		(26,430)		(25,461)		(24,865)
Consolidated earnings before income taxes	$	199,571	$	197,807	$	187,567

Segment assets consist of accounts receivable, inventories, property, plant, and equipment, net, goodwill, and other intangibles, net.  A summary of consolidated total assets, consolidated depreciation and amortization and consolidated capital expenditures follows:

	Year Ended September 30,
	2013		2012		2011
Segment assets:
Aerospace	$	1,349,027	$	1,059,754	$	1,036,797
Energy		599,007		605,842		569,929
Total segment assets		1,948,034		1,665,596		1,606,726
Unallocated corporate property, plant and equipment, net		50,115		15,763		8,556
Other unallocated assets		207,535		178,605		166,152
Consolidated total assets	$	2,205,684	$	1,859,964	$	1,781,434
Segment depreciation and amortization:
Aerospace	$	49,887	$	43,840	$	50,167
Energy		20,890		21,738		21,691
Total segment depreciation and amortization		70,777		65,578		71,858
Unallocated corporate amounts		3,456		3,039		3,535
Consolidated depreciation and amortization	$	74,233	$	68,617	$	75,393
Segment capital expenditures:
Aerospace	$	74,964	$	32,244	$	34,007
Energy		28,137		22,590		14,168
Total segment capital expenditures		103,101		54,834		48,175
Unallocated corporate amounts		38,499		10,066		80
Consolidated capital expenditures	$	141,600	$	64,900	$	48,255

Sales to General Electric were made by all of Woodward’s reportable segments and totaled approximately 15% of net sales in fiscal year 2013, 14% of net sales in fiscal year 2012, and 14% of net sales in fiscal year 2011.  Accounts receivable from General Electric totaled approximately 11% and 10% of accounts receivable at September 30, 2013 and 2012, respectively.

U.S. Government related sales from our reportable segments were as follows:

	Direct U.S. Government Sales		Indirect U.S. Government Sales		Total U.S. Government Related Sales
Fiscal year ended September 30, 2013
Aerospace	$	104,410	$	289,197	$	393,607
Energy		3,649		8,106		11,755
Total net external sales	$	108,059	$	297,303	$	405,362
Percentage of total net sales		6%		15%		21%
Fiscal year ended September 30, 2012
Aerospace	$	78,075	$	254,636	$	332,711
Energy		3,904		7,228		11,132
Total net external sales	$	81,979	$	261,864	$	343,843
Percentage of total net sales		4%		14%		18%
Fiscal year ended September 30, 2011
Aerospace	$	67,116	$	252,462	$	319,578
Energy		3,448		7,530		10,978
Total net external sales	$	70,564	$	259,992	$	330,556
Percentage of total net sales		4%		15%		19%

Accounts receivable from the U.S. Government totaled approximately 4% and 2% of accounts receivable at September 30, 2013 and 2012, respectively.

The customers who account for approximately 10% or more of sales to each of Woodward’s reporting segments for the fiscal year ended September 30, 2013 follow:

	Customer
Aerospace	Boeing, General Electric, United Technologies
Energy	General Electric, Weichai Westport

Net sales by geographical area, as determined by the location of the customer invoiced, were as follows:

	Year Ended September 30,
	2013		2012		2011
United States	$	1,058,912	$	927,345	$	874,791
Europe (1)		480,922		542,753		473,054
Asia		287,742		288,738		264,493
Other countries		108,400		106,791		99,364
Consolidated net sales	$	1,935,976	$	1,865,627	$	1,711,702

(1) Net sales to customers in Germany accounted for 9%,  13%, and 12% of consolidated net sales for the years ended September 30, 2013, 2012, and 2011, respectively.

Property, plant, and equipment, net by geographical area, as determined by the physical location of the assets, were as follows:

	At September 30,
	2013		2012
United States	$	285,038	$	175,233
Germany		29,619		26,964
Other countries		35,391		32,308
Consolidated property, plant and equipment, net	$	350,048	$	234,505