Segments

9 Months Ended

Sep. 30, 2018

Our businesses are organized based on the nature and location of the services they provide. Certain summarized information related to our reportable segments is shown in the tables below. None of the operating segments have been aggregated. Although Corporate and Other does not represent an operating segment, it is included in the tables below to reconcile segment information to that of the consolidated Company. Prior period segment disclosures have been recast to include the former SemMexico and SemLogistics segments within Corporate and Other, as these businesses are no longer significant and are not expected to be significant in the future. These businesses were sold during the nine months ended September 30, 2018. Eliminations of transactions between segments are also included within Corporate and Other in the tables below.

During the fourth quarter of 2017, we changed our definition of segment profit to focus on the results of each segment exclusive of general and administrative costs and related overhead allocations. Segment Profit is defined as revenue, less cost of products sold (exclusive of depreciation and amortization) and operating expenses, plus equity earnings and is adjusted to remove unrealized gains and losses on commodity derivatives and to reflect equity earnings on an earnings before interest, taxes and depreciation and amortization (“EBITDA”) basis. Reflecting equity earnings on an EBITDA basis is achieved by adjusting equity earnings to exclude our percentage of interest, taxes, depreciation and amortization from equity earnings for operated equity method investees. For our investment in NGL Energy, we exclude equity earnings and include cash distributions received. Prior period segment profit has been recast to be consistent with the revised definition.

The accounting policies of each segment are the same as the accounting policies of the consolidated Company. Transactions between segments are generally recorded based on prices negotiated between the segments.

Our results by segment are presented in the tables below (in thousands):



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Revenues:
Crude Transportation
External	$	27,309		$	18,824		$	82,025		$	46,822
Intersegment	7,630			8,988			22,669			22,443
Crude Facilities
External	8,657			9,053			27,762			28,513
Intersegment	2,831			2,567			8,669			7,563
Crude Supply and Logistics
External	434,591			339,874			1,259,709			928,664
HFOTCO
External	49,728			34,675			139,869			34,675
SemGas
External	71,772			54,095			183,177			167,605
Intersegment	4,703			2,152			11,567			8,693
SemCAMS
External	41,939			39,500			156,715			136,412
Corporate and Other
External	—			49,902			42,142			132,421
Intersegment	(15,164		)	(13,708		)	(42,905		)	(38,700		)
Total Revenues	$	633,996		$	545,922		$	1,891,399		$	1,475,111



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018		2017
Earnings from equity method investments:
Crude Transportation	$	14,546		$	17,372		$	41,489	$	52,207
Corporate and Other	(18		)	(5		)	4		4
Total earnings from equity method investments	$	14,528		$	17,367		$	41,493	$	52,211



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Depreciation and amortization:
Crude Transportation	$	12,802	$	11,170	$	38,331	$	23,595
Crude Facilities	2,170		2,058		6,455		6,024
Crude Supply and Logistics	217		103		608		243
HFOTCO	21,575		19,300		60,373		19,300
SemGas	10,837		9,114		32,107		27,140
SemCAMS	5,250		4,727		15,752		13,657
Corporate and Other	747		3,663		2,263		10,377
Total depreciation and amortization	$	53,598	$	50,135	$	155,889	$	100,336



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018		2017
Income tax expense (benefit):
HFOTCO	$	209		$	166		$	599	$	166
SemCAMS	2,837			1,270			8,943		4,961
Corporate and Other⁽¹⁾	(5,743		)	(38,685		)	7,231		(38,656		)
Total income tax expense (benefit)	$	(2,697	)	$	(37,249	)	$	16,773	$	(33,529	)
(1) Corporate and Other includes the impact of intra-period tax allocation.



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Segment profit:
Crude Transportation	$	38,135		$	34,585		$	110,310		$	91,864
Crude Facilities	8,209			8,806			27,233			27,851
Crude Supply and Logistics	(7,005		)	(1,693		)	(15,547		)	(6,294		)
HFOTCO	36,161			28,504			101,953			28,504
SemGas	19,754			15,555			49,468			53,266
SemCAMS	20,543			16,704			64,104			52,606
Corporate and Other	(913		)	8,421			9,878			25,084
Total segment profit	$	114,884		$	110,882		$	347,399		$	272,881



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Reconciliation of segment profit to net income (loss):
Total segment profit	$	114,884		$	110,882		$	347,399		$	272,881
Less:
Adjustment to reflect equity earnings on an EBITDA basis	4,926			6,678			14,695			20,079
Net unrealized loss (gain) related to commodity derivative instruments	(4,860		)	1,833			1,775			932
General and administrative expense	21,904			38,389			71,267			86,920
Depreciation and amortization	53,598			50,135			155,889			100,336
Loss (gain) on disposal or impairment, net	(383		)	41,625			(2,125		)	43,801
Interest expense	35,318			32,711			113,683			60,055
Loss on early extinguishment of debt	—			—			—			19,930
Foreign currency transaction loss (gain)	(983		)	(747		)	4,625			(1,758		)
Other income, net	(400		)	(3,390		)	(1,883		)	(4,116		)
Income tax expense (benefit)	(2,697		)	(37,249		)	16,773			(33,529		)
Net income (loss)	$	8,461		$	(19,103	)	$	(27,300	)	$	(19,769	)



	September 30, 2018		December 31, 2017
Total assets (excluding intersegment receivables):
Crude Transportation	$	1,019,010	$	1,039,399
Crude Facilities	148,332		153,953
Crude Supply and Logistics	600,455		674,684
HFOTCO	2,033,840		2,003,298
SemGas	725,520		714,777
SemCAMS	672,471		518,900
Corporate and Other	98,147		271,806
Total assets	$	5,297,775	$	5,376,817



	September 30, 2018		December 31, 2017
Equity investments:
Crude Transportation	$	258,098	$	266,362
Corporate and Other	18,923		18,919
Total equity investments	$	277,021	$	285,281