Segment Information

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Segment Information

Segment Information

We manage our operations through three segments: real estate, oil and gas and other natural resources. Real estate secures entitlements and develops infrastructure on our lands for single-family residential and mixed-use communities, and manages our undeveloped land, commercial and income producing properties, primarily a hotel and our multifamily investments. Oil and gas is an independent oil and gas exploration, development and production operation and manages our owned and leased mineral interests. Other natural resources manages our timber, recreational leases and water resource initiatives.

Total assets allocated by segment are as follows:

	First Quarter-End		Year-End
	2015		2014
	(In thousands)
Real estate	$	670,067	$	654,774
Oil and gas	352,695		342,703
Other natural resources	20,077		22,531
Assets not allocated to segments (a)	194,132		238,191
	$	1,236,971	$	1,258,199

  _________________________

^(a)  Assets not allocated to segments at first quarter-end2015 principally consist of cash and cash equivalents of $126,262,000 and a net deferred tax asset of $44,583,000. Assets not allocated to segments at year-end 2014 principally consist of cash and cash equivalents of $170,127,000 and a net deferred tax asset of $40,624,000.

We evaluate performance based on segment earnings (loss) before unallocated items and income taxes. Segment earnings (loss) consist of operating income, equity in earnings (loss) of unconsolidated ventures, gain on sales of assets, interest income on loans secured by real estate and net (income) loss attributable to noncontrolling interests. Items not allocated to our business segments consist of general and administrative expense, share-based and long-term incentive compensation, gain on sale of strategic timberland, interest expense and other corporate non-operating income and expense. The accounting policies of the segments are the same as those described in Note 1—Basis of Presentation. Our revenues are derived from U.S. operations and all of our assets are located in the U.S. In first quarter2015, no single customer accounted for more than ten percent of our total revenues.

Segment revenues and earnings are as follows:

	First Quarter
	2015			2014
	(In thousands)
Revenues:
Real estate	$	32,830		$	65,480
Oil and gas	13,185			17,554
Other natural resources	1,790			1,571
Total revenues	$	47,805		$	84,605
Segment earnings (loss):
Real estate	$	9,066		$	23,575
Oil and gas	(2,941		)	807
Other natural resources	(391		)	(528		)
Total segment earnings	5,734			23,854
Items not allocated to segments (a)	(18,251		)	(10,862		)
Income (loss) before taxes attributable to Forestar Group Inc.	$	(12,517	)	$	12,992

  _________________________

^(a)  Items not allocated to segments consist of:

	First Quarter
	2015			2014
	(In thousands)
General and administrative expense	$	(6,020	)	$	(5,168	)
Shared-based and long-term incentive compensation expense	(3,458		)	(313		)
Interest expense	(8,821		)	(5,503		)
Other corporate non-operating income	48			122
	$	(18,251	)	$	(10,862	)