Segment Disclosures

12 Months Ended

Dec. 31, 2019

Our reportable segments are strategic business units that offer different products and services. Our segments are managed separately because each segment requires different marketing strategies and business knowledge. Management evaluates performance based on segment operating margin, which includes revenue from affiliates and external customers, operating expenses, cost of product sales and earnings of non-controlled entities.

We believe that investors benefit from having access to the same financial measures used by management. Operating margin, which is presented in the following tables, is an important measure used by management to evaluate the economic performance of our core operations. Operating margin is not a GAAP measure, but the components of operating margin are computed using amounts that are determined in accordance with GAAP. A reconciliation of operating margin to operating profit, which is its nearest comparable GAAP financial measure, is included in the tables below. Operating profit includes depreciation, amortization and impairment expense and G&A expense that management does not consider when evaluating the core profitability of our separate operating segments.

During 2018, we adopted ASC 606, Revenue from Contracts with Customers. Amounts from 2017 reflected in the following tables have not been adjusted and continue to be reflected in accordance with our historical accounting. Refer to Note 4 – Revenue for further details.



	Year Ended December 31, 2017
	(in thousands)
	Refined Products		Crude Oil			Marine Storage			Intersegment Eliminations			Total
Transportation and terminals revenue	$	1,096,040	$	458,455		$	180,683		$	(3,403	)	$	1,731,775
Product sales revenue	717,140		35,053			6,013			—			758,206
Affiliate management fee revenue	1,388		13,950			2,342			—			17,680
Total revenue	1,814,568		507,458			189,038			(3,403		)	2,507,661
Operating expenses	400,439		120,920			65,296			(8,677		)	577,978
Cost of product sales	586,751		41,325			7,541			—			635,617
(Earnings) losses of non-controlled entities	1,632		(120,173		)	(2,453		)	—			(120,994		)
Operating margin	825,746		465,386			118,654			5,274			1,415,060
Depreciation, amortization and impairment expense	109,434		48,796			33,126			5,274			196,630
G&A expenses	103,225		41,490			21,002			—			165,717
Operating profit	$	613,087	$	375,100		$	64,526		$	—		$	1,052,713
Additions to long-lived assets	$	269,369	$	168,306		$	127,012					$	564,687

	As of December 31, 2017
Segment assets	$	3,499,492	$	2,817,186		$	871,557					$	7,188,235
Corporate assets												206,140
Total assets												$	7,394,375
Goodwill	$	38,369	$	12,082		$	2,809					$	53,260
Investments in non-controlled entities	$	29,578	$	961,032		$	91,901					$	1,082,511



	Year Ended December 31, 2018
	(in thousands)
	Refined Products			Crude Oil			Marine Storage			Intersegment Eliminations			Total
Transportation and terminals revenue	$	1,151,980		$	549,849		$	180,850		$	(3,691	)	$	1,878,988
Product sales revenue	872,144			46,767			8,309			—			927,220
Affiliate management fee revenue	1,512			14,832			4,021			—			20,365
Total revenue	2,025,636			611,448			193,180			(3,691		)	2,826,573
Operating expenses	424,851			166,213			68,010			(9,638		)	649,436
Cost of product sales	650,071			44,128			10,114			—			704,313
Earnings of non-controlled entities	(16,039		)	(162,233		)	(2,845		)	—			(181,117		)
Operating margin	966,753			563,340			117,901			5,947			1,653,941
Depreciation, amortization and impairment expense	168,954			54,318			35,858			5,947			265,077
G&A expenses	118,491			51,523			24,269			—			194,283
Operating profit	$	679,308		$	457,499		$	57,774		$	—		$	1,194,581
Additions to long-lived assets	$	298,502		$	142,108		$	65,744					$	506,354

	As of December 31, 2018
Segment assets	$	3,715,653		$	2,710,068		$	1,065,525					$	7,491,246
Corporate assets													256,291
Total assets													$	7,747,537
Goodwill	$	38,369		$	12,082		$	2,809					$	53,260
Investments in non-controlled entities	$	37,574		$	783,486		$	255,246					$	1,076,306



	Year Ended December 31, 2019
	(in thousands)
	Refined Products			Crude Oil			Marine Storage			Intersegment Eliminations			Total
Transportation and terminals revenue	$	1,186,966		$	602,045		$	187,036		$	(5,417	)	$	1,970,630
Product sales revenue	699,766			28,280			8,046			—			736,092
Affiliate management fee revenue	1,747			14,471			4,972			—			21,190
Total revenue	1,888,479			644,796			200,054			(5,417		)	2,727,912
Operating expenses	411,849			164,236			68,919			(10,923		)	634,081
Cost of product sales	582,271			28,051			8,957			—			619,279
Other operating (income) expense	(2,555		)	7,213			(7,633		)	—			(2,975		)
Earnings of non-controlled entities	(4,140		)	(160,891		)	(3,930		)	—			(168,961		)
Operating margin	901,054			606,187			133,741			5,506			1,646,488
Depreciation, amortization and impairment expense	136,861			63,315			40,452			5,506			246,134
G&A expenses	117,291			53,310			26,049			—			196,650
Operating profit	$	646,902		$	489,562		$	67,240		$	—		$	1,203,704
Additions to long-lived assets	$	761,135		$	66,452		$	52,550					$	880,137

	As of December 31, 2019
Segment assets	$	4,302,945		$	2,791,035		$	1,212,673					$	8,306,653
Corporate assets													131,076
Total assets													$	8,437,729
Goodwill	$	38,369		$	12,082		$	2,809					$	53,260
Investments in non-controlled entities	$	24,457		$	818,167		$	397,927					$	1,240,551