Segment Information

12 Months Ended

Dec. 31, 2014

Segment Information

SEGMENT INFORMATION

In 2014 the Company changed its financial segment reporting to reflect management and organizational changes made by the Company. Under the new structure, the manager of two primary segments is accountable for results at the segment profit level and reports directly to the Company’s Chief Executive Officer, who is responsible for evaluating companywide performance and resource allocation decisions between the segments, and is the chief operating decision maker. Accordingly, the Company will report its financial performance based on two reportable segments: Critical Materials Handling (CMH) and Electronic Materials (EM). The Company's two reportable segments are business divisions that provide unique products and services.

• CMH: provides a broad range of products that filter, handle, dispense, and protect critical materials used in the semiconductor manufacturing process and in other high-technology manufacturing. CMH’s products and subsystems include high-purity materials packaging, fluid handling and dispensing systems and liquid filters as well as microenvironment products that protect critical substrates such as wafers during shipping and manufacturing. CMH also provides specialized graphite components and specialty coatings for high-temperature applications.

• EM: provides high performance materials, materials packaging and materials delivery systems that enable high yield, cost effective semiconductor manufacturing. EM’s products consist of specialized chemistries and performance materials, gas microcontamination control systems and components, and sub-atmospheric pressure gas delivery systems for the safe and efficient handling of hazardous gases to semiconductor process equipment.

Inter-segment sales are not significant. Segment profit is defined as net sales less direct segment operating expenses, excluding certain unallocated expenses, consisting mainly of general and administrative costs for the Company’s human resources, finance and information technology functions as well as interest expense, amortization of intangible assets, charges for the fair value write-up of acquired inventory sold, contingent consideration fair value adjustments, income taxes and equity in net income of affiliates.

Corporate assets consist primarily of cash and cash equivalents, short-term investments, assets held for sale, investments, deferred tax assets and deferred tax charges.

Summarized financial information for the Company’s reportable segments is shown in the following tables.

(In thousands)	2014		2013		2012
Net sales:
CMH	$	653,964	$	609,826	$	630,929
EM	308,105		83,633		84,974
Total net sales	$	962,069	$	693,459	$	715,903
(In thousands)	2014		2013		2012
Segment profit:
CMH	$	138,379	$	128,910	$	144,758
EM	90,121		20,034		21,051
Total segment profit	$	228,500	$	148,944	$	165,809
(In thousands)	2014		2013		2012
Total assets:
CMH	$	500,575	$	395,291	$	362,672
EM	804,889		46,831		41,348
Corporate	456,627		433,172		407,524
Total assets	$	1,762,091	$	875,294	$	811,544

(In thousands)	2014		2013		2012
Depreciation and amortization:
CMH	$	37,455	$	32,797	$	31,612
EM	41,671		4,238		4,358
Corporate	4,578		1,780		1,637
Total depreciation and amortization	$	83,704	$	38,815	$	37,607
(In thousands)	2014		2013		2012
Capital expenditures:
CMH	$	33,619	$	49,893	$	40,683
EM	19,450		6,842		5,579
Corporate	4,664		3,625		3,667
Total capital expenditures	$	57,733	$	60,360	$	49,929

The following table reconciles total segment profit to income before income taxes and equity in net loss (income) of affiliates:

(In thousands)	2014			2013			2012
Total segment profit	$	228,500		$	148,944		$	165,809
Less:
Charge for fair value write-up of acquired inventory sold	48,586			—			—
Amortization of intangibles	37,067			9,347			9,594
Contingent consideration fair value adjustment	(1,282		)	(1,813		)	—
Unallocated general and administrative expenses	122,775			47,173			56,771
Operating income	21,354			94,237			99,444
Interest expense	33,355			153			271
Interest income	(1,336		)	(317		)	(281		)
Other expense (income), net	2,727			(1,794		)	(249		)
(Loss) income before income tax (benefit) expense and equity in net loss (income) of affiliates	$	(13,392	)	$	96,195		$	99,703

The following table presents amortization of intangibles for each of the Company’s segments for the years ended December 31, 2014, 2013 and 2012:

(In thousands)	2014		2013		2012
Amortization of intangibles:
CMH	$	10,180	$	8,620	$	8,772
EM	26,887		727		822
	$	37,067	$	9,347	$	9,594

The following table summarizes total net sales, based upon the country to which sales to external customers were made for the years ended December 31, 2014, 2013 and 2012:

(In thousands)	2014		2013		2012
Net sales:
United States	$	239,040	$	201,380	$	218,903
Japan	121,452		101,529		131,521
Germany	27,867		23,240		24,437
Taiwan	230,824		128,194		126,732
Singapore	46,051		30,942		25,607
South Korea	122,328		76,353		70,763
China	66,186		36,299		31,499
Other	108,321		95,522		86,441
	$	962,069	$	693,459	$	715,903

The following table summarizes property, plant and equipment, net, attributed to significant countries for the years ended December 31, 2014, 2013 and 2012:

(In thousands)	2014		2013		2012
Property, plant and equipment:
United States	$	222,125	$	123,846	$	86,476
Korea	32,163		4,422		4,946
Japan	22,261		24,007		27,024
Malaysia	20,607		23,801		28,398
Other	16,413		10,364		10,177
	$	313,569	$	186,440	$	157,021

In the year ended December 31, 2014, one individual customer accounted for 13.6% of net sales, which includes sales from both of the Company's segments. In the years ended December 31, 2013 and 2012, no single customer accounted for ten percent or more of net sales.