Segments

3 Months Ended

Mar. 31, 2019

As described in Note 1, 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.

In the fourth quarter of 2018, due to recent changes in our asset portfolio, the company elected to reorganize its business structure and reporting relationships to enhance execution and capture operating efficiencies. In conjunction with the reorganization, our reportable segments have changed. Prior period segment disclosures have been recast to reflect the new segments. U.S. Liquids includes the results of our U.S. crude oil operations, including the results of our historical HFOTCO segment. U.S. Gas contains the results of our historical SemGas segment. Canada includes the operations of our historical SemCAMS segment. Our prior SemMexico and SemLogistics segments are included within Corporate and Other, as these businesses were disposed of in 2018. Eliminations of transactions between segments are also included within Corporate and Other in the tables below.

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.

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 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.

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



	Three Months Ended March 31,
	2019		2018
Revenues:
U.S. Liquids
External	$	473,468	$	522,945
U.S. Gas
External	48,937		52,256



Intersegment	4,289			3,640
Canada
External	44,827			45,145
Corporate and Other
External	—			41,263
Intersegment	(4,289		)	(3,640		)
Total Revenues	$	567,232		$	661,609



	Three Months Ended March 31,
	2019		2018
Earnings from equity method investments:
U.S. Liquids	$	13,937	$	12,605
Corporate and Other	14		9
Total earnings from equity method investments	$	13,951	$	12,614



	Three Months Ended March 31,
	2019		2018
Depreciation and amortization:
U.S. Liquids	$	39,487	$	34,107
U.S. Gas	11,095		10,449
Canada	7,783		5,238
Corporate and Other	671		742
Total depreciation and amortization	$	59,036	$	50,536



	Three Months Ended March 31,
	2019			2018
Income tax expense (benefit):
U.S. Liquids	$	147		$	209
Canada	207			2,970
Corporate and Other	(4,960		)	19,904
Total income tax expense (benefit)	$	(4,606	)	$	23,083



	Three Months Ended March 31,
	2019			2018
Segment profit:
U.S. Liquids	$	89,511		$	68,056
U.S. Gas	12,165			14,277
Canada	22,693			22,113
Corporate and Other	(237		)	10,963
Total segment profit	$	124,132		$	115,409



	Three Months Ended March 31,
	2019			2018
Reconciliation of segment profit to net income (loss):
Total segment profit	$	124,132		$	115,409
Less:
Adjustment to reflect equity earnings on an EBITDA basis	4,710			4,883
Net unrealized loss (gain) related to commodity derivative instruments	4,818			2,226
General and administrative expense	29,547			26,477
Depreciation and amortization	59,036			50,536
Gain on disposal of long-lived assets, net	(1,444		)	(3,566		)
Interest expense	36,652			42,461
Foreign currency transaction loss (gain)	(288		)	3,294
Other income, net	(979		)	(950		)
Income tax expense (benefit)	(4,606		)	23,083
Net income (loss)	$	(3,314	)	$	(33,035	)



	March 31, 2019		December 31, 2018
Total assets (excluding intersegment receivables):
U.S. Liquids	$	4,005,344	$	3,689,384
U.S. Gas	703,069		716,837
Canada	1,304,837		684,418
Corporate and Other	360,788		119,668
Total assets	$	6,374,038	$	5,210,307



	March 31, 2019		December 31, 2018
Equity investments:
U.S. Liquids	$	257,914	$	255,043
Corporate and Other	18,979		18,966
Total equity investments	$	276,893	$	274,009