Note 4. - Financial information by segment

Atlantica’s segment structure reflects how management currently makes financial decisions and allocates resources. Its operating segments are based on the following geographies where the contracted concessional assets are located:

•

North America

•

South America

•

EMEA

Based on the type of business, as of September 30, 2019, the Company had the following business sectors:

Renewable energy: Renewable energy assets include two solar plants in the United States, Solana and Mojave, each with a gross capacity of 280 MW and located in Arizona and California, respectively. The Company owns eight solar platforms in Spain: Solacor 1 and 2 with a gross capacity of 100 MW, PS10 and PS20 with a gross capacity of 31 MW, Solaben 2 and 3 with a gross capacity of 100 MW, Helioenergy 1 and 2 with a gross capacity of 100 MW, Helios 1 and 2 with a gross capacity of 100 MW, Solnova 1, 3 and 4 with a gross capacity of 150 MW, Solaben 1 and 6 with a gross capacity of 100 MW and Seville PV with a gross capacity of 1 MW. The Company also owns a solar plant in South Africa, Kaxu with a gross capacity of 100 MW. Additionally, the Company owns three wind farms in Uruguay, Palmatir, Cadonal and Melowind, with a gross capacity of 50 MW each, and a hydroelectric power plant in Peru with a gross capacity of 4 MW.

Efficient natural gas: Efficient natural gas assets include (i) ACT, a 300 MW cogeneration plant in Mexico, which is party to a 20-year take-or-pay contract with Pemex for the sale of electric power and steam, and (ii) a minority interest in Monterrey, a 142 MW gas-fired engine facility including 130MW installed capacity and 12 MW battery capacity.

Electric transmission lines: Electric transmission assets include (i) three lines in Peru, ATN, ATS and ATN2, spanning a total of 1,015 miles; and (ii) four lines in Chile, Quadra 1, Quadra 2, Palmucho and Chile TL3, spanning a total of 137 miles.

Water: Water assets include a minority interest in two desalination plants in Algeria, Honaine and Skikda with an aggregate capacity of 10.5 Mft3 per day.

Atlantica’s Chief Operating Decision Maker (CODM) assesses the performance and assignment of resources according to the identified operating segments. The CODM considers the revenues as a measure of the business activity and the Further Adjusted EBITDA as a measure of the performance of each segment. Further Adjusted EBITDA is calculated as profit/(loss) for the period attributable to the parent company, after adding back loss/(profit) attributable to non-controlling interests from continued operations, income tax, share of profit/(loss) of associates carried under the equity method, finance expense net, depreciation, amortization and impairment charges of entities included in these consolidated financial statements, and compensations received from Abengoa in lieu of Abengoa Concessões Brasil Holding (“ACBH”) dividends (for the period up to the first quarter of 2017 only).

In order to assess performance of the business, the CODM receives reports of each reportable segment using revenues and Further Adjusted EBITDA. Net interest expense evolution is assessed on a consolidated basis. Financial expense and amortization are not taken into consideration by the CODM for the allocation of resources.

In the nine-month periods ended September 30, 2019 and September 30, 2018, Atlantica had four customers with revenues representing more than 10% of the total revenues, three in the renewable energy and one in the efficient natural gas business sectors.

The following tables show Revenues and Further Adjusted EBITDA by operating segments and business sectors for the nine-month periods ended September 30, 2019 and 2018:

	Revenue				Further Adjusted EBITDA
	For the nine-month period ended September 30,				For the nine-month period ended September 30,
	($ in thousands)
Geography	2019		2018		2019		2018
North America		273,913		294,625		254,492		272,157
South America		105,760		91,807		87,757		76,234
EMEA		418,490		450,493		308,755		359,970
Total		798,163		836,925		651,004		708,361

	Revenue				Further Adjusted EBITDA
	For the nine-month period ended September 30,				For the nine-month period ended September 30,
	($ in thousands)
Business sector	2019		2018		2019		2018
Renewable energy		609,828		652,135		493,311		565,915
Efficient natural gas		92,891		95,355		81,668		71,724
Electric transmission lines		77,024		71,920		65,133		60,447
Water		18,420		17,515		10,892		10,275
Total		798,163		836,925		651,004		708,361

The reconciliation of segment Further Adjusted EBITDA with the profit/(loss) attributable to the Company is as follows:

	For the nine-month period ended September 30, ($ in thousands)
	2019			2018
Profit/(Loss) attributable to the Company	$	60,832			120,512
(Loss)/Profit attributable to non-controlling interests		7,548			9,828
Income tax		46,979			59,068
Share of (profits)/losses of associates		(3,881	)		(4,690	)
Financial expense, net		304,637			279,844
Depreciation, amortization, and impairment charges		234,889			243,799
Total segment Further Adjusted EBITDA	$	651,004			708,361

The assets and liabilities by operating segments (and business sector) as of September 30, 2019 and December 31, 2018 are as follows:

Assets and liabilities by geography as of September 30, 2019:

	North America		South America		EMEA		Balance as of September 30, 2019
	($ in thousands)
Assets allocated
Contracted concessional assets		3,332,194		1,179,488		3,591,658		8,103,340
Investments carried under the equity method		93,054		-		47,531		140,585
Current financial investments		157,972		73,054		28,308		259,334
Cash and cash equivalents (project companies)		210,487		47,431		310,444		568,362
Subtotal allocated		3,793,707		1,299,973		3,977,941		9,071,621
Unallocated assets
Other non-current assets								249,916
Other current assets (including cash and cash equivalents at holding company level)								415,611
Subtotal unallocated								665,527
Total assets								9,737,148

	North America		South America		EMEA		Balance as of September 30, 2019
	($ in thousands)
Liabilities allocated
Long-term and short-term project debt		1,722,879		893,497		2,314,971		4,931,347
Grants and other liabilities		1,503,410		7,404		129,390		1,640,204
Subtotal allocated		3,226,289		900,901		2,444,361		6,571,551
Unallocated liabilities
Long-term and short-term corporate debt								686,409
Other non-current liabilities								621,150
Other current liabilities								160,993
Subtotal unallocated								1,468,552
Total liabilities								8,040,103
Equity unallocated								1,697,045
Total liabilities and equity unallocated								3,165,597
Total liabilities and equity								9,737,148

Assets and liabilities by geography as of December 31, 2018:

	North America		South America		EMEA		Balance as of December 31, 2018
	($ in thousands)
Assets allocated
Contracted concessional assets		3,453,652		1,210,624		3,884,905		8,549,181
Investments carried under the equity method		-		-		53,419		53,419
Current financial investments		147,213		61,959		30,080		239,252
Cash and cash equivalents (project companies)		195,678		41,316		287,456		524,450
Subtotal allocated		3,796,543		1,313,899		4,255,860		9,366,302
Unallocated assets
Other non-current assets								188,736
Other current assets (including cash and cash equivalents at holding company level)								363,993
Subtotal unallocated								552,729
Total assets								9,919,031

	North America		South America		EMEA		Balance as of December 31, 2018
			($ in thousands)
Liabilities allocated
Long-term and short-term project debt		1,725,961		900,801		2,464,352		5,091,114
Grants and other liabilities		1,527,724		7,550		122,852		1,658,126
Subtotal allocated		3,253,685		908,351		2,587,204		6,749,240
Unallocated liabilities
Long-term and short-term corporate debt								684,073
Other non-current liabilities								523,827
Other current liabilities								205,779
Subtotal unallocated								1,413,679
Total liabilities								8,162,919
Equity unallocated								1,756,112
Total liabilities and equity unallocated								3,169,791
Total liabilities and equity								9,919,031

Assets and liabilities by business sector as of September 30, 2019:

	Renewable energy		Efficient natural gas		Electric transmission lines		Water		Balance as of September 30, 2019
					($ in thousands)
Assets allocated
Contracted concessional assets		6,593,786		563,937		860,987		84,630		8,103,340
Investments carried under the equity method		82,328		15,184		125		42,948		140,585
Current financial investments		13,953		150,257		77,196		17,928		259,334
Cash and cash equivalents (project companies)		534,712		4,297		21,903		7,450		568,362
Subtotal allocated		7,224,779		733,675		960,211		152,956		9,071,621
Unallocated assets
Other non-current assets										249,916
Other current assets (including cash and cash equivalents at holding company level)										415,611
Subtotal unallocated										665,527
Total assets										9,737,148

	Renewable energy		Efficient natural gas		Electric transmission lines		Water		Balance as of September 30, 2019
	($ in thousands)
Liabilities allocated
Long-term and short-term project debt		3,723,984		532,961		649,142		25,260		4,931,347
Grants and other liabilities		1,638,376		143		951		734		1,640,204
Subtotal allocated		5,362,360		533,104		650,093		25,994		6,571,551
Unallocated liabilities
Long-term and short-term corporate debt										686,409
Other non-current liabilities										621,150
Other current liabilities										160,993
Subtotal unallocated										1,468,552
Total liabilities										8,040,103
Equity unallocated										1,697,045
Total liabilities and equity unallocated										3,165,597
Total liabilities and equity										9,737,148

Assets and liabilities by business sector as of December 31, 2018:

	Renewable energy		Efficient natural gas		Electric transmission lines		Water		Balance as of December 31, 2018
	($ in thousands)
Assets allocated
Contracted concessional assets		6,998,020		580,997		882,980		87,184		8,549,181
Investments carried under the equity method		10,257		-		-		43,162		53,419
Current financial investments		15,396		147,192		61,102		15,562		239,252
Cash and cash equivalents (project companies)		453,096		45,625		14,043		11,686		524,450
Subtotal allocated		7,476,769		773,814		958,125		157,594		9,366,302
Unallocated assets
Other non-current assets										188,736
Other current assets (including cash and cash equivalents at holding company level)										363,993
Subtotal unallocated										552,729
Total assets										9,919,031

	Renewable energy		Efficient natural gas		Electric transmission lines		Water		Balance as of December 31, 2018
	($ in thousands)
Liabilities allocated
Long-term and short-term project debt		3,868,626		545,123		647,820		29,545		5,091,114
Grants and other liabilities		1,656,146		161		1,025		794		1,658,126
Subtotal allocated		5,524,772		545,284		648,845		30,339		6,749,240
Unallocated liabilities
Long-term and short-term corporate debt										684,073
Other non-current liabilities										523,827
Other current liabilities										205,779
Subtotal unallocated										1,413,679
Total liabilities										8,162,919
Equity unallocated										1,756,112
Total liabilities and equity unallocated										3,169,791
Total liabilities and equity										9,919,031

The amount of depreciation, amortization and impairment charges recognized for the nine-month periods ended September 30, 2019 and 2018 are as follows:

	For the nine-month period ended September 30,
Depreciation, amortization and impairment by geography	2019			2018
	($ in thousands)
North America		(88,647	)		(95,713	)
South America		(35,553	)		(30,806	)
EMEA		(110,689	)		(117,280	)
Total		(234,889	)		(243,799	)

	For the nine-month period ended September 30,
Depreciation, amortization and impairment by business sectors	2019			2018
	($ in thousands)
Renewable energy		(215,941	)		(213,465	)
Efficient natural gas		784			(9,433	)
Electric transmission lines		(20,093	)		(21,070	)
Water		361			169
Total		(234,889	)		(243,799	)