Note 14 - Segment Reporting

9 Months Ended

Sep. 30, 2020

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

NOTE

14—

SEGMENT REPORTING

 

The Company is organized into reporting segments based on the nature of the products 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: 

Heavy Fabrications

The Company provides large, complex and precision fabrications to customers in a broad range of industrial markets. The Company's most significant presence is within the U.S. wind energy industry, although it has diversified into other industrial markets in order to improve capacity utilization, reduce customer concentrations, and reduce exposure to uncertainty related to governmental policies currently impacting the U.S. wind energy industry. Within the U.S. wind energy industry, the Company provides steel towers and adapters primarily to wind turbine manufacturers. 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 up to approximately

550

towers (

1,650

tower sections), sufficient to support turbines generating more than

1,100

 megawatts of power. The Company has expanded production capabilities and leveraged manufacturing competencies, including welding, lifting capacity and stringent quality practices, into aftermarket and original equipment manufacturer (“OEM”) components utilized in surface and underground mining, construction, material handling, oil and gas (“O&G”) and other infrastructure markets.

Gearing 

The Company provides gearing and gearboxes to a broad set of customers in diverse markets including; onshore and offshore O&G fracking and drilling, surface and underground mining, defense, wind energy, steel, material handling and other infrastructure markets. For nearly a century, the Company has manufactured loose gearing, gearboxes and systems, and provided heat treatment services for aftermarket and OEM applications. The Company uses an integrated manufacturing process, which includes machining and finishing processes in Cicero, Illinois, and heat treatment in Neville Island, Pennsylvania.

Industrial Solutions 

The Company provides supply chain solutions, inventory management, kitting and assembly services, primarily serving the combined cycle natural gas turbine market.

Corporate

“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. 

The accounting policies of the reportable segments are the same as those referenced in Note

1,

“Basis of Presentation” of these condensed consolidated financial statements. Summary financial information by reportable segment for the

three

and

nine

months ended

September 30, 2020

and

2019

is as follows:

	Heavy Fabrications		Gearing			Industrial Solutions		Corporate			Eliminations			Consolidated
For the Three Months Ended September 30, 2020
Revenues from external customers	$	43,434		7,100			4,080		—			—		$	54,614
Intersegment revenues		6		25			1		—			(32	)		—
Net revenues		43,440		7,125			4,081		—			(32	)		54,614
Operating profit (loss)		2,020		(1,023	)		87		(1,559	)		—			(475	)
Depreciation and amortization		928		488			109		42			—			1,567
Capital expenditures		601		42			7		18			—			668

	Heavy Fabrications		Gearing		Industrial Solutions		Corporate			Eliminations			Consolidated
For the Three Months Ended September 30, 2019
Revenues from external customers	$	33,834		7,989		4,315		—			—		$	46,138
Intersegment revenues		—		—		2		—			(2	)		—
Net revenues		33,834		7,989		4,317		—			(2	)		46,138
Operating profit (loss)		693		496		141		(1,588	)		—			(258	)
Depreciation and amortization		951		508		123		34			—			1,616
Capital expenditures		346		235		8		4			—			593

	Heavy Fabrications		Gearing			Industrial Solutions		Corporate			Eliminations			Consolidated
For the Nine Months Ended September 30, 2020
Revenues from external customers	$	125,418		20,241			12,515		—			—		$	158,174
Intersegment revenues		6		32			1		—			(39	)		—
Net revenues		125,424		20,273			12,516		—			(39	)		158,174
Operating profit (loss)		8,760		(1,935	)		496		(5,081	)		—			2,240
Depreciation and amortization		2,831		1,503			319		108			—			4,761
Capital expenditures		1,199		211			134		53			—			1,597

	Heavy Fabrications		Gearing		Industrial Solutions			Corporate			Eliminations			Consolidated
For the Nine Months Ended September 30, 2019
Revenues from external customers	$	91,098	$	27,282	$	10,587		$	—		$	—		$	128,967
Intersegment revenues		—		—		2			—			(2	)		—
Net revenues		91,098		27,282		10,589			—			(2	)		128,967
Operating profit (loss)		789		2,797		(116	)		(4,428	)		—			(958	)
Depreciation and amortization		3,024		1,472		368			142			—			5,006
Capital expenditures		855		875		22			24			—			1,776

	Total Assets as of
	September 30,			December 31,
Segments:	2020			2019
Heavy Fabrications	$	43,256		$	41,432
Gearing		45,742			47,022
Industrial Solutions		10,563			8,893
Corporate		230,680			239,629
Eliminations		(204,185	)		(214,110	)
	$	126,056		$	122,866