Operating Segments and Related Information

9 Months Ended

Sep. 30, 2011

Operating Segments and Related Information

Note 18. Operating Segments and Related Information

Operating Segments

The Company has two business divisions: Commercial Systems and Government Systems.

Commercial Systems Division

The Commercial Systems division is focused on the design, manufacture, and marketing of instrument, sensor, and electronics solutions that facilitate improved situational awareness and environmental analytics for commercial customers. The division is comprised of two operating segments: Thermal Vision and Measurement and Raymarine. The Thermal Vision and Measurement segment provides advanced thermal imaging solutions for emerging commercial and industrial markets that enable people to see at night or through adverse weather conditions and to capture, measure, and analyze temperature data. The Raymarine segment provides electronics for the maritime market and is a leading global provider of fully integrated “stem to stern” networked electronic systems for boats of all sizes.

Government Systems Division

The Government Systems division designs, manufactures, and markets advanced imaging and detection systems for government markets where high performance is required. The division is comprised of three operating segments: Surveillance, Detection, and Integrated Systems. The Surveillance segment provides enhanced imaging and recognition solutions to a wide variety of military, law enforcement, public safety, and other government customers around the world for the protection of borders, troops, and public welfare. The Detection segment produces sensor instruments that detect and identify chemical, biological, radiological, nuclear, and explosives (“CBRNE”) threats for military force protection, homeland security, and commercial applications. The Integrated Systems segment develops platform solutions for combating sophisticated security threats and incorporates multiple sensor systems in order to deliver actionable intelligence for wide area surveillance, intrusion detection, and facility security.

As of January 1, 2011, within the Commercial Systems division, the Company combined its former Thermography and Commercial Vision Systems operating segments into the Thermal Vision and Measurement operating segment. Also on January 1, 2011 within the Government Systems division, certain ICx business units were combined with the legacy Government Systems operating segment to form the Surveillance operating segment. The remaining business units of ICx have been separated into the Detection and Integrated Systems operating segments. Accordingly, the Company has retrospectively reported the September 30, 2010 amounts on a comparable basis.

Raymarine was acquired in May 2010 and ICx was acquired in October 2010 and therefore, the operating results for the nine month period ended September 30, 2011 for the Raymarine operating segment, and for the three month and nine month periods ended September 30, 2011 for the Detection and Integrated Systems operating segments are not comparable to the operating results for the prior periods described below.

Operating segment information is as follows (in thousands):

	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
Revenue – External Customers:
Thermal Vision and Measurement	$	160,998		$	132,399		$	470,799		$	397,377
Raymarine		35,442			36,909			136,169			64,133
Surveillance		139,827			163,189			431,164			489,418
Detection		21,193			—			56,284			—
Integrated Systems		13,867			—			44,434			—
	$	371,327		$	332,497		$	1,138,850		$	950,928
	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
Revenue – Intersegments:
Thermal Vision and Measurement	$	3,799		$	3,039		$	14,197		$	11,588
Raymarine		—			—			7			—
Surveillance		5,982			4,790			23,003			17,982
Detection		1,913			—			3,391			—
Integrated Systems		—			—			1,811			—
Eliminations		(11,694	)		(7,829	)		(42,409	)		(29,570	)
	$	—		$	—		$	—		$	—

	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
Earnings (loss) from operations:
Thermal Vision and Measurement	$	47,162		$	39,868		$	131,447		$	109,753
Raymarine		(2,824	)		977			11,829			4,420
Surveillance		51,872			62,177			149,672			190,807
Detection		1,997			—			(4,878	)		—
Integrated Systems		298			—			126			—
Other		(13,096	)		(17,235	)		(84,669	)		(45,036	)
	$	85,409		$	85,787		$	203,527		$	259,944

The loss from operations of Other for the nine months ended September 30, 2011 includes a litigation settlement payment of $39.0 million made during the second quarter of 2011.

	September 30, 2011		December 31, 2010
Segment assets (accounts receivable, net and inventories):
Thermal Vision and Measurement	$	211,486	$	198,419
Raymarine		59,497		58,236
Surveillance		330,228		327,240
Detection		29,310		39,270
Integrated Systems		12,217		11,516
Discontinued Operations		4,805		8,198
	$	647,543	$	642,879

Revenue and Long-Lived Assets by Geographic Area

Information related to revenue by significant geographical location, determined by the end customer, is as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
United States	$	205,579	$	182,732	$	598,236	$	503,193
Europe		87,647		71,737		279,341		220,740
Other international		78,101		78,028		261,273		226,995
	$	371,327	$	332,497	$	1,138,850	$	950,928

Long-lived assets by significant geographic locations are as follows (in thousands):

	September 30, 2011		December 31, 2010
United States	$	590,509	$	583,299
Europe		293,163		287,081
Other international		9,329		9,423
	$	893,001	$	879,803

Major Customers

Revenue derived from major customers is as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
US Government	$	118,659	$	120,741	$	348,944	$	339,897