Segment Information

The Company operates one principal homebuilding business. In accordance with FASB ASC Topic 280, Segment Reporting ("ASC 280"), the Company has determined that each of its operating divisions is an operating segment. The Company’s President and Chief Executive Officer has been identified as the chief operating decision maker. The Company’s chief operating decision maker directs the allocation of resources to operating segments based on the profitability and cash flows of each respective segment.

The Company’s homebuilding operations design, construct and sell a wide range of homes designed to meet the specific needs in each of its markets. In accordance with ASC 280, prior to the acquisition of RSI Communities (see Note 2), the Company's homebuilding operations had been grouped into six operating segments. During the three months ended March 31, 2018, the Company added one additional operating segment, Texas, as a result of the RSI Acquisition. As such, in accordance with the aggregation criteria defined by ASC 280, the Company’s homebuilding operating segments have been grouped into seven reportable segments:

California, consisting of operations in Orange, Los Angeles, San Diego, Alameda, Contra Costa, Santa Clara, Riverside and San Bernardino counties.

Arizona, consisting of operations in the Phoenix, Arizona metropolitan area.

Nevada, consisting of operations in the Las Vegas, Nevada metropolitan area.

Colorado, consisting of operations in the Denver, Colorado metropolitan area.

Washington, consisting of operations in the Seattle, Washington metropolitan area.

Oregon, consisting of operations in the Portland, Oregon metropolitan area.

Texas, consisting of operations in the Austin, Texas and San Antonio, Texas metropolitan areas.

Corporate develops and implements strategic initiatives and supports the Company’s operating segments by centralizing key administrative functions such as finance and treasury, information technology, risk management and litigation and human resources.

Segment financial information relating to the Company’s operations was as follows (in thousands):



	Three Months Ended March 31, 2019			Three Months Ended March 31, 2018
Operating revenue:
California	$	186,118		$	134,812
Arizona	29,594			32,039
Nevada	37,705			49,176
Colorado	56,036			40,063
Washington (1)	43,940			55,651
Oregon	51,087			46,853
Texas	51,384			14,774
Total operating revenue	$	455,864		$	373,368

(1) Operating revenue in the Washington segment includes construction services revenue in the periods ended March 31, 2019 and 2018.


	Three Months Ended March 31, 2019			Three Months Ended March 31, 2018
Income before provision for income taxes:
California	$	16,105		$	11,419
Arizona	2,493			2,487
Nevada	4,192			4,839
Colorado	6,024			3,164
Washington	1,145			4,511
Oregon	2,070			3,637
Texas	1,181			434
Corporate	(13,563		)	(15,089		)
Income before gain on extinguishment of debt	$	19,647		$	15,402
Corporate - Gain on extinguishment of debt	383			—
Income before provision for income taxes	$	20,030		$	15,402



	March 31, 2019		December 31, 2018
Homebuilding assets:
Owned:
California	$	878,608	$	930,714
Arizona	171,124		168,507
Nevada	190,787		189,363
Colorado	138,148		149,450
Washington	306,596		308,270
Oregon	429,448		440,105
Texas	271,652		234,093
Corporate (1)	214,565		193,696
	$	2,600,928	$	2,614,198
Not Owned:
California	$	78,543	$	91,849
Arizona	114,858		114,858
Washington	21,657		21,657
Texas	79,027		87,212
Total homebuilding assets	$	2,895,013	$	2,929,774


(1)	Comprised primarily of cash and cash equivalents, receivables, deferred income taxes, and other assets.