Segment and Geographic Information

12 Months Ended

Dec. 31, 2016

Segment Reporting [Abstract]

Segment and Geographic Information

15.    Segment and Geographic Information

The Company currently operates through three business segments that are aligned with key product types and end markets served:

• Couplings, Clutches & Brakes.Couplings are the interface between two shafts, which enable power to be transmitted from one shaft to the other. Clutches in this segment are devices which use mechanical, hydraulic, pneumatic, or friction type connections to facilitate engaging or disengaging two rotating members. Brakes are combinations of interacting parts that work to slow or stop machinery.  Products in this segment are generally used in heavy industrial applications and energy markets.

• Electromagnetic Clutches & Brakes.    Products in this segment include brakes and clutches that are used to electronically slow, stop, engage or disengage equipment utilizing electromagnetic friction type connections.   Products in this segment are used in industrial and commercial markets including agricultural machinery, material handling, motion control, and turf & garden.

• Gearing.    Gears are utilized to reduce the speed and increase the torque of an electric motor or engine to the level required to drive a particular piece of equipment. Gears produced by the Company are primarily utilized in industrial applications.

The segment information presented below for the prior periods has been reclassified to conform to the new presentation.

Segment financial information and a reconciliation of segment results to consolidated results follows:

	Year Ended December 31,
	2016			2015			2014
Net Sales:
Couplings, Clutches & Brakes	$	305,406		$	342,299		$	396,089
Electromagnetic Clutches & Brakes		217,856			219,676			218,550
Gearing		192,003			192,252			212,628
Inter-segment eliminations		(6,359	)		(7,575	)		(7,450	)
Net sales		708,906			746,652			819,817
Income from operations:
Segment earnings:
Couplings, Clutches & Brakes		20,941			38,750			49,299
Electromagnetic Clutches & Brakes		26,406			21,634			22,014
Gearing		22,718			21,094			22,698
Restructuring		(9,849	)		(7,214	)		(1,767	)
Corporate expenses (1)		(12,670	)		(10,050	)		(17,135	)
Income from operations		47,546			64,214			75,109
Other non-operating (income) expense:
Net interest expense		11,679			12,164			11,994
Loss on extinguishment of convertible debt		1,989		-			-
Other non-operating (income) expense, net		(7	)		963			(3	)
		13,661			13,127			11,991
Income before income taxes		33,885			51,087			63,118
Provision for income taxes		8,745			15,744			22,936
Net income	$	25,140		$	35,343		$	40,182

⁽¹⁾ Certain expenses are maintained at the corporate level and not allocated to the segments. These include various administrative expenses related to the corporate headquarters, depreciation on capitalized software costs, non-capitalizable software implementation costs, acquisition related expenses and non-cash partial pension settlements.

While the Company did not have any customers that represented total sales of greater than 10%, the Gearing business segment had one customer that approximated 10.2% of total sales during the year ended December 31, 2016.

Selected information by segment (continued)

	Years Ended December 31,
	2016		2015		2014
Depreciation and amortization:
Couplings, Clutches & Brakes	$	15,180	$	15,897	$	17,196
Electromagnetic Clutches & Brakes		4,615		4,565		5,009
Gearing		7,000		6,617		7,447
Corporate		3,103		3,042		2,485
Total depreciation and amortization	$	29,898	$	30,121	$	32,137
	Years Ended December 31,
	2016		2015
Total assets:
Couplings, Clutches & Brakes	$	511,934	$	312,117
Electromagnetic Clutches & Brakes		169,507		125,887
Gearing		147,829		150,860
Corporate (2)		40,554		43,468
Total assets	$	869,824	$	632,332

⁽²⁾ Corporate assets are primarily cash and cash equivalents, tax related asset accounts, certain capitalized software costs, property, plant and equipment and deferred financing costs.

	Net Sales						Property, Plant and Equipment
	Years Ended December 31,
	2016		2015		2014		2016		2015
North America (primarily U.S.)	$	418,536	$	452,172	$	488,523	$	81,675	$	84,960
Europe		217,736		218,857		255,049		89,672		52,949
Asia and other		72,634		75,623		76,245		5,696		7,504
Total	$	708,906	$	746,652	$	819,817	$	177,043	$	145,413

Net sales to third parties are attributed to the geographic regions based on the country in which the shipment originates. Amounts attributed to the geographic regions for property, plant and equipment are based on the location of the entity, which holds such assets.