SEGMENT REPORTING

9 Months Ended

Sep. 30, 2013

SEGMENT REPORTING

SEGMENT REPORTING

NOTE 14 — SEGMENT REPORTING

The Company is organized into reporting segments based on the nature of the products and services offered and business activities from which it earns revenues and incurs expenses for which discrete financial information is available and regularly reviewed by the Company’s chief operating decision maker. The Company’s segments and their product and service offerings are summarized below:

Towers and Weldments

The Company manufactures towers for wind turbines, specifically the large and heavier wind towers that are designed for 2 megawatt (“MW”) and larger wind turbines. Production facilities, located in Manitowoc, Wisconsin and Abilene, Texas, are situated in close proximity to the primary U.S. domestic wind energy and equipment manufacturing hubs. The two facilities have a combined annual tower production capacity of approximately 500 towers, sufficient to support turbines generating more than 1,200 MW of power. This product segment also encompasses the manufacture of specialty fabrications and specialty weldments for mining and other industrial customers.

Gearing

The Company engineers, builds and remanufactures precision gears and gearing systems for oil and gas, wind, mining, steel and other industrial applications. The Company uses an integrated manufacturing process, which includes machining and finishing processes in Cicero, Illinois, and heat treatment in Neville Island, Pennsylvania.

Services

The Company offers a comprehensive range of services, primarily to wind farm developers and operators. The Company specializes in non-routine maintenance services for both kilowatt and MW turbines. The Company also offers comprehensive field services to the wind industry. The Company is increasingly focusing its efforts on the identification and/or development of product and service offerings which will improve the reliability and efficiency of wind turbines, and therefore enhance the economic benefits to its customers. The Company provides wind services across the U.S., with primary service locations in South Dakota and Texas. In February 2011, the Company put into operation its Abilene, Texas gearbox service facility (the “Gearbox Facility”), which is focused on servicing the growing installed base of MW wind turbines as they come off warranty and, to a limited extent, industrial gearboxes requiring precision repair and testing.

Corporate and Eliminations

“Corporate” includes the assets and selling, general and administrative expenses of the Company’s corporate office. “Eliminations” comprises adjustments to reconcile segment results to consolidated results.

Summary financial information by reportable segment for the three and nine months ended September 30, 2013 and 2012 is as follows:

For the Three Months Ended September 30, 2013:	Towers and Weldments		Gearing			Services			Corporate			Eliminations			Consolidated
Revenues from external customers	$	48,594	$	10,138		$	3,704		$	—		$	—		$	62,436
Intersegment revenues (1)	64		251			—			—			(315		)	—
Operating profit (loss)	6,723		(5,653		)	(1,276		)	(2,197		)	22			(2,381		)
Depreciation and amortization	941		2,014			409			15			—			3,379
Capital expenditures	750		2,459			7			22			—			3,238

For the Three Months Ended September 30, 2012:	Towers and Weldments		Gearing			Services			Corporate			Eliminations			Consolidated
Revenues from external customers	$	37,423	$	10,778		$	6,844		$	—		$	—		$	55,045
Intersegment revenues (1)	—		478			55			—			(533		)	—
Operating profit (loss)	1,740		(2,637		)	(570		)	(2,048		)	(12		)	(3,527		)
Depreciation and amortization	942		2,995			413			17			—			4,367
Capital expenditures	127		893			44			71			—			1,135

For the Nine Months Ended September 30, 2013:	Towers and Weldments		Gearing			Services			Corporate			Eliminations			Consolidated
Revenues from external customers	$	116,127	$	28,098		$	15,238		$	—		$	—		$	159,463
Intersegment revenues (1)	67		3,456			15			—			(3,538		)	—
Operating profit (loss)	12,828		(12,394		)	(3,239		)	(7,386		)	(19		)	(10,210		)
Depreciation and amortization	2,841		7,469			1,064			38			—			11,412
Capital expenditures	1,235		4,114			240			378			—			5,967

For the Nine Months Ended September 30, 2012:	Towers and Weldments		Gearing			Services			Corporate			Eliminations			Consolidated
Revenues from external customers	$	109,587	$	40,256		$	15,956		$	—		$	—		$	165,799
Intersegment revenues (1)	—		1,096			81			—			(1,177		)	—
Operating profit (loss)	3,306		(5,390		)	(3,331		)	(6,224		)	12			(11,627		)
Depreciation and amortization	2,722		8,217			1,237			51			—			12,227
Capital expenditures	540		1,657			944			159			—			3,300

	Total Assets as of
	September 30,			December 31,
Segments:	2013			2012
Towers and Weldments	$	51,054		$	50,801
Gearing	70,561			71,371
Services	15,906			13,976
Assets held for sale	2,152			8,042
Corporate	303,401			308,336
Eliminations	(278,845		)	(309,616		)
	$	164,229		$	142,910

(1) Intersegment revenues generally include a 10% markup over costs and primarily consist of sales from Gearing to Services. Sales from Gearing to Services totaled $3,456 and $1,096 for the nine months ended September 30, 2013 and 2012, respectively.