Segment information

6 Months Ended

Jun. 30, 2020

Segment information

Segment information

12. SEGMENT INFORMATION

As of June 30, 2020, the Company’s business is organized into two reportable segments: Earth Intelligence and Space Infrastructure. With the Company’s closing of the MDA Transaction on April 8, 2020, MDA is no longer considered a reportable segment and has been classified within Income from discontinued operations, net of tax in the Unaudited Condensed Consolidated Statements of Operations. All prior-period amounts have been adjusted to reflect the reportable segment change.

The Earth Intelligence reportable segment is a supplier of high-resolution space-based optical and radar imagery products and analytics. The Space Infrastructure reportable segment is a provider of Space Infrastructure that designs, builds, integrates and tests solutions for space-based communication satellites, on-orbit servicing, robotic assembly and space exploration.

The Company’s CODM measures the performance of each segment based on revenue and Adjusted EBITDA. Adjusted EBITDA is defined as earnings before interest, tax, depreciation and amortization (“EBITDA”) adjusted for certain items affecting comparability as specified in the calculation. Certain items affecting comparability include restructuring, impairments, satellite insurance recovery, gain on sale of assets, CEO severance and transaction and integration related expense. Transaction and integration related expense includes costs associated with de-leveraging activities, acquisitions and dispositions and the integration of acquisitions. Corporate and other expenses include items such as corporate office costs, regulatory costs, executive and director compensation, foreign exchange gains and losses, and fees for audit, legal and consulting services.

Intersegment sales are generally recorded at cost plus a specified margin, which may differ from what the segment may be able to obtain on sales to external customers.

The following table summarizes the operating performance of the Company’s segments:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Revenues:
Earth Intelligence	$	278	$	263	$	549	$	517
Space Infrastructure		184		181		316		391
Intersegment eliminations		(23)		(32)		(45)		(65)
Total revenues	$	439	$	412	$	820	$	843

Adjusted EBITDA:
Earth Intelligence	$	146	$	124	$	279	$	249
Space Infrastructure		11		7		(28)		5
Intersegment eliminations		(7)		(4)		(14)		(8)
Corporate and other expenses		(12)		(19)		(22)		(39)
Restructuring		—		(4)		—		(15)
Transaction and integration related expense		(3)		(2)		(4)		(7)
Impairment loss, including inventory		—		—		(14)		(3)
Satellite insurance recovery		—		183		—		183
CEO severance		—		—		—		(3)
Depreciation and amortization		(89)		(96)		(179)		(191)
Interest expense, net		(48)		(49)		(97)		(98)
Interest income 1		—		—		1		—
Equity in (income) loss from joint ventures, net of tax		(2)		2		(1)		3
(Loss) income from continuing operations before taxes	$	(4)	$	142	$	(79)	$	76

¹ Included in Other (income) expense, net on the Unaudited Condensed Consolidated Statements of Operations.

The Company’s capital expenditures are as follows:

Three Months Ended June 30, 2020	Earth Intelligence		Space Infrastructure		Corporate and Eliminations		Total
Capital expenditures:
Property, plant and equipment	$	28	$	5	$	11	$	44
Intangible assets		20		—		4		24
	$	48	$	5	$	15	$	68
Three Months Ended June 30, 2019	Earth Intelligence		Space Infrastructure		Corporate and Eliminations		Total
Capital expenditures:
Property, plant and equipment	$	51	$	3	$	(13)	$	41
Intangible assets		13		1		(1)		13
	$	64	$	4	$	(14)	$	54

Six Months Ended June 30, 2020	Earth Intelligence		Space Infrastructure		Corporate and Eliminations		Total
Capital expenditures:
Property, plant and equipment	$	62	$	8	$	18	$	88
Intangible assets		36		—		4		40
	$	98	$	8	$	22	$	128
Six Months Ended June 30, 2019	Earth Intelligence		Space Infrastructure		Corporate and Eliminations		Total
Capital expenditures:
Property, plant and equipment	$	101	$	8	$	(12)	$	97
Intangible assets		26		1		—		27
	$	127	$	9	$	(12)	$	124

Substantially all of the Company’s long-lived tangible assets were in the United States as of June 30, 2020 and December 31, 2019.