Segment Information

6 Months Ended

Jun. 30, 2011

Segment Information [Abstract]

Segment Information

(10) Segment Information

The Company is currently organized into three primary divisions or operating segments: Molycorp Minerals, Molycorp Silmet and Molycorp Metals and Alloys. Molycorp Minerals owns and operates the rare earth mine and processing facilities in Mountain Pass, California. Molycorp Silmet produces rare earth oxides and rare metals at the manufacturing facility located in Sillamäe, Estonia. MMA manufactures neodymium and samarium magnet alloy and other specialty alloy products in Tolleson, Arizona.

The accounting policies of these segments are the same as those described in the summary of significant accounting policies except that asset retirement obligations are recognized only for the Molycorp Minerals, certain government grants are recognized only for Molycorp Silmet, and annual profit earned by Molycorp Silmet is not taxed. In accordance with the Estonian Income Tax Act, only distribution of annual profit is subject to income tax.

Intersegment sales and transfers are based on similar arms-length transactions with third parties at the time of the sale.

Molycorp’s reportable segments are strategic business units that fit into the Company’s “mine-to-magnet” strategy to be the world’s most integrated producer of rare earth products, including oxides, metals, alloys and magnets. All three segments were acquired as a unit and management at the time of the acquisition was retained.

							Molycorp			Eliminations
Three Months Ended June 30, 2011	Molycorp			Molycorp			Metals and			and Other			Total
(In thousands)	Minerals			Silmet			Alloys			Adjustments			Molycorp
Sales:
Total	$	76,295		$	32,656		$	10,250		$	(19,586	)	$	99,615
Intersegment		(15,947	)		(3,639	)		—			19,586			—
Cost of goods sold
Total		(21,709	)		(20,472	)		(11,143	)		10,401			(42,923	)
Intersegment		2,770			7,631			—			(10,401	)		—
Selling, general and administrative expenses		(12,294	)		(1,411	)		(112	)		—			(13,817	)
Depreciation, amortization and accretion expense		(332	)		—			(191	)		—			(523	)
Stock-based compensation		(412	)		—			—			—			(412	)
Operating income (loss)		28,371			14,765			(1,196	)		—			41,940
Other income (expense)		304			(103	)		2			—			203
Income before income taxes	$	28,675		$	14,662		$	(1,194	)	$	—		$	42,143
Total assets at June 30, 2011	$	1,099,900		$	152,984		$	29,705		$	(140,923	)	$	1,141,666
Capital expenditures (accrual basis)	$	70,742		$	2,231		$	—		$	—		$	72,973

							Molycorp			Eliminations
Six Months Ended June 30, 2011	Molycorp			Molycorp			Metals and			and Other			Total
(In thousands)	Minerals			Silmet			Alloys			Adjustments			Molycorp
Sales:
Total	$	102,556		$	32,656		$	10,250		$	(19,586	)	$	125,876
Intersegment		(15,947	)		(3,639	)		—			19,586			—
Cost of goods sold
Total		(38,386	)		(20,472	)		(11,143	)		10,401			(59,600	)
Intersegment		2,770			7,631			—			(10,401	)		—
Selling, general and administrative expenses		(20,633	)		(1,411	)		(112	)		—			(22,156	)
Depreciation, amortization and accretion expense		(649	)		—			(191	)		—			(840	)
Stock-based compensation		(3,311	)		—			—			—			(3,311	)
Operating income (loss)		26,400			14,765			(1,196	)		—			39,969
Other income (expense)		276			(103	)		2			—			175
Income before income taxes	$	26,676		$	14,662		$	(1,194	)	$	—		$	40,144
Total assets at June 30, 2011	$	1,099,900		$	152,984		$	29,705		$	(140,923	)	$	1,141,666
Capital expenditures (accrual basis)	$	111,966		$	2,231		$	—		$	—		$	114,197

The total assets elimination of $141.0 million is comprised of $16.4 million of intercompany accounts receivable, $10.6 million of intercompany inventory and $114.0 million of intercompany investments.