Segment reporting

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Segment reporting

Segment reporting

Segment information is presented in accordance with ASC 280, Segment Reporting, which establishes standards for reporting information about operating segments. It also establishes standards for related disclosures about products and geographic areas. Operating segments are defined as components of an enterprise that engage in business activities that earn revenues, incur expenses and prepare separate financial information that is evaluated regularly by the Company’s chief operating decision maker (“CODM”) in order to allocate resources and assess performance. The Company's Chief Executive Officer is its CODM. The Corporate and Other segment includes expenses related to certain executive salaries, interest costs related to the Company's credit agreements, acquisition-related costs, and other corporate costs that are not directly attributable to the Company's operating segments. The Company's segments follow the same accounting policies as the Company.

Net sales from the major products sold to external customers include drainage pipe and precast products and concrete and steel water transmission pipe.

The Company’s three geographic areas consist of the United States, Canada, and Mexico for which it reports net sales, fixed assets and total assets. For purposes of evaluating segment profit, the CODM reviews EBITDA as a basis for making the decisions to allocate resources and assess performance.

The following tables set forth the disaggregation of revenue earned from contracts with customers based on the Company's reportable segments as well as other financial information attributable to the Company's reportable segments for the three and six months ended June 30, 2020 and 2019 (in thousands):

	For the three months ended June 30,						For the six months ended June 30,
	2020			2019			2020			2019
Net sales:
Drainage Pipe & Products	$	235,596		$	241,680		$	405,830		$	405,414
Water Pipe & Products	190,590			168,539			351,232			296,663
Corporate and Other	—			—			—			—
Total	$	426,186		$	410,219		$	757,062		$	702,077
Depreciation and amortization:
Drainage Pipe & Products	$	8,300		$	9,456		$	16,545		$	18,658
Water Pipe & Products	13,493			14,595			27,372			29,470
Corporate and Other	613			339			990			654
Total	$	22,406		$	24,390		$	44,907		$	48,782
Segment EBITDA and reconciliation to income (loss) before income taxes:
Drainage Pipe & Products	$	57,414		$	48,997		$	83,466		$	74,063
Water Pipe & Products	39,717			24,973			62,590			33,714
Corporate and Other	(20,453		)	(19,962		)	(40,120		)	(37,048		)
Less: Interest expense	(19,702		)	(25,783		)	(40,447		)	(50,448		)
Depreciation and amortization	(22,406		)	(24,390		)	(44,907		)	(48,782		)
Income (loss) before income taxes	$	34,570		$	3,835		$	20,582		$	(28,501	)
Capital expenditures:
Drainage Pipe & Products	$	2,366		$	7,519		$	5,396		$	15,448
Water Pipe & Products	1,942			2,248			3,123			4,525
Corporate and Other	223			695			362			2,463
Total	$	4,531		$	10,462		$	8,881		$	22,436
							June 30,			December 31,
							2020			2019
Total assets:
Drainage Pipe & Products							$	837,390		$	819,373
Water Pipe & Products							865,237			862,542
Corporate and Other							68,870			58,143
Total							$	1,771,497		$	1,740,058

The Company has an investment in an equity method investee included in the Drainage Pipe & Products segment for which earnings from equity method investee were $3.1 million, $5.9 million, $3.4 million and $5.0 million for the three and six months ended June 30, 2020 and June 30, 2019, respectively, and with the following balances (in thousands):

	June 30,		December 31,
	2020		2019
Investment in equity method investee	$	51,459	$	50,034

Disaggregated revenue by geographic location is provided in the tables below. The Company has operations in the United States, Canada and Mexico. The economic characteristics of the Company's customers do not significantly vary across geographic locations or product lines. The Company has both revenues and long-lived assets in each country; and those assets and revenues are recorded within geographic location as follows (in thousands):

Property, plant, and equipment, net:	June 30,		December 31,
	2020		2019
United States	$	408,159	$	422,486
Canada	29,903		43,754
Mexico	8,912		9,335
	$	446,974	$	475,575

Net sales:	For the three months ended June 30,				For the six months ended June 30,
	2020		2019		2020		2019
United States	$	407,764	$	391,721	$	723,144	$	668,458
Canada	16,322		16,555		29,808		29,655
Mexico	2,100		1,943		4,110		3,964
	$	426,186	$	410,219	$	757,062	$	702,077