Business Segment Information

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Business Segment Information

BUSINESS SEGMENT INFORMATION

Our business segments share a focus on industrial flow control technology and have a high number of common customers. These segments also have complementary product offerings and technologies that are often combined in applications that provide us a net competitive advantage. Our segments also benefit from our global footprint and our economies of scale in reducing administrative and overhead costs to serve customers more cost effectively.

We conduct our operations through these three business segments based on type of product and how we manage the business:

• EPD for long lead time, custom and other highly-engineered pumps and pump systems, mechanical seals, auxiliary systems and replacement parts and related services;

• IPD for engineered and pre-configured industrial pumps and pump systems and related products and services; and

• FCD for engineered and industrial valves, control valves, actuators and controls and related services.

For decision-making purposes, our Chief Executive Officer ("CEO") and other members of senior executive management use financial information generated and reported at the reportable segment level. Our corporate headquarters does not constitute a separate division or business segment. On January 11, 2012, a new unified operational leadership structure was announced resulting in the creation of a Chief Operating Officer position. The creation of this position did not impact how we have defined the above three business segments or our assessment of our CEO as the chief operating decision maker.

We evaluate segment performance and allocate resources based on each reportable segment’s operating income. Amounts classified as "Eliminations and All Other" include corporate headquarters costs and other minor entities that do not constitute separate segments. Intersegment sales and transfers are recorded at cost plus a profit margin, with the sales and related margin on such sales eliminated in consolidation.

The following is a summary of the financial information of our reportable segments as of and for the years ended December 31, 2014, 2013 and 2012 reconciled to the amounts reported in the consolidated financial statements.

							Subtotal—Reportable Segments		Eliminations and All Other(1)			Consolidated Total
	EPD		IPD		FCD
	(Amounts in thousands)
Year Ended December 31, 2014:
Sales to external customers		$2,396,068	$	872,563	$	1,609,254	$	4,877,885	$	—		$	4,877,885
Intersegment sales	67,974		60,364		6,474		134,812		(134,812		)	—
Segment operating income	427,080		125,292		322,845		875,217		(85,385		)	789,832
Depreciation and amortization	48,765		17,000		35,458		101,223		9,054			110,277
Identifiable assets	2,249,033		774,964		1,467,756		4,491,753		476,267			4,968,020
Capital expenditures	65,762		18,510		37,496		121,768		10,851			132,619

							Subtotal—Reportable Segments		Eliminations and All Other(1)			Consolidated Total
	EPD		IPD		FCD
	(Amounts in thousands)
Year Ended December 31, 2013:
Sales to external customers		$2,473,731	$	873,389	$	1,607,499	$	4,954,619	$	—		$	4,954,619
Intersegment sales	63,365		76,779		8,213		148,357		(148,357		)	—
Segment operating income	423,339		115,658		307,967		846,964		(86,681		)	760,283
Depreciation and amortization	46,494		14,122		36,590		97,206		9,186			106,392
Identifiable assets	2,260,961		827,155		1,520,085		4,608,201		428,532			5,036,733
Capital expenditures	75,379		17,445		40,205		133,029		6,061			139,090

							Subtotal—Reportable Segments		Eliminations and All Other(1)			Consolidated Total
	EPD		IPD		FCD
	(Amounts in thousands)
Year Ended December 31, 2012:
Sales to external customers		$2,338,527	$	863,941	$	1,548,871	$	4,751,339	$	—		$	4,751,339
Intersegment sales	64,621		89,957		8,206		162,784		(162,784		)	—
Segment operating income	396,082		99,526		253,398		749,006		(73,228		)	675,778
Depreciation and amortization	48,007		13,408		36,418		97,833		9,393			107,226
Identifiable assets	2,223,791		745,276		1,485,686		4,454,753		356,205			4,810,958
Capital expenditures	64,038		17,351		46,239		127,628		7,911			135,539

Geographic Information — We attribute sales to different geographic areas based on the facilities’ locations. Long-lived assets are classified based on the geographic area in which the assets are located and exclude deferred taxes, goodwill and intangible assets. Prior period information has been updated to conform to current year presentation. Sales and long-lived assets by geographic area are as follows:

	Year Ended December 31, 2014
	Sales		Percentage		Long-Lived Assets		Percentage
	(Amounts in thousands, except percentages)
United States	$	1,724,392	35.4	%	$	386,489	41.6	%
EMA(1)	1,991,638		40.8	%	268,334		28.9	%
Asia(2)	571,195		11.7	%	126,878		13.7	%
Other(3)	590,660		12.1	%	147,145		15.8	%
Consolidated total	$	4,877,885	100.0	%	$	928,846	100.0	%

	Year Ended December 31, 2013
	Sales		Percentage		Long-Lived Assets		Percentage
	(Amounts in thousands, except percentages)
United States	$	1,699,053	34.3	%	$	374,125	41.5	%
EMA(1)	2,102,428		42.4	%	287,071		31.8	%
Asia(2)	552,383		11.2	%	124,619		13.8	%
Other(3)	600,755		12.1	%	115,904		12.9	%
Consolidated total	$	4,954,619	100.0	%	$	901,719	100.0	%

	Year Ended December 31, 2012
	Sales		Percentage		Long-Lived Assets		Percentage
	(Amounts in thousands, except percentages)
United States	$	1,597,737	33.6	%	$	332,667	39.6	%
EMA(1)	2,054,809		43.2	%	273,274		32.5	%
Asia(2)	548,589		11.6	%	122,911		14.6	%
Other(3)	550,204		11.6	%	111,257		13.3	%
Consolidated total	$	4,751,339	100.0	%	$	840,109	100.0	%

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(1) "EMA" includes Europe, the Middle East and Africa. No individual country within this group represents 10% or more of consolidated totals for any period presented.

(2) "Asia" includes Asia and Australia. No individual country within this group represents 10% or more of consolidated totals for any period presented.

(3) "Other" includes Canada and Latin America. No individual country within this group represents 10% or more of consolidated totals for any period presented.

Net sales to international customers, including export sales from the U.S., represented approximately 68% of total sales in 2014 and 71% for both 2013 and 2012.

Major Customer Information — We have a large number of customers across a large number of manufacturing and service facilities and do not believe that we have sales to any individual customer that represent 10% or more of consolidated sales for any of the years presented.