Business segment data

6 Months Ended

Jun. 30, 2018

The Company's reportable segments are those that are based on the Company's method of internal reporting, which generally segregates the strategic business units due to differences in products, services and regulation. The internal reporting of these operating segments is defined based on the reporting and review process used by the Company's chief executive officer. The vast majority of the Company's operations are located within the United States.

The electric segment generates, transmits and distributes electricity in Montana, North Dakota, South Dakota and Wyoming. The natural gas distribution segment distributes natural gas in those states as well as in Idaho, Minnesota, Oregon and Washington. These operations also supply related value-added services.

The pipeline and midstream segment provides natural gas transportation, underground storage and gathering services through regulated and nonregulated pipeline systems primarily in the Rocky Mountain and northern Great Plains regions of the United States. This segment also provides cathodic protection and other energy-related services.

The construction materials and contracting segment operations mine, process and sell construction aggregates (crushed stone, sand and gravel); produce and sell asphalt mix; and supply ready-mixed concrete. This segment focuses on vertical integration of its contracting services with its construction materials to support the aggregate based product lines including aggregate placement, asphalt and concrete paving, and site development and grading. Although not common to all locations, other products include the sale of cement, liquid asphalt for various commercial and roadway applications, various finished concrete products and other building materials and related contracting services. This segment operates in the central, southern and western United States and Alaska and Hawaii.

The construction services segment provides inside and outside specialty contracting services. Its outside services include design, construction and maintenance of overhead and underground electrical distribution and transmission lines, substations, external lighting, traffic signalization, and gas pipelines, as well as utility excavation and the manufacture and distribution of transmission

line construction equipment. Its inside services include design, construction and maintenance of electrical and communication wiring and infrastructure, fire suppression systems, and mechanical piping and services. This segment also constructs and maintains renewable energy projects. These specialty contracting services are provided to utilities and large manufacturing, commercial, industrial, institutional and government customers.

The Other category includes the activities of Centennial Capital, which insures various types of risks as a captive insurer for certain of the Company's subsidiaries. The function of the captive insurer is to fund the self-insured layers of the insured Company's general liability, automobile liability, pollution liability and other coverages. Centennial Capital also owns certain real and personal property. The Other category also includes certain general and administrative costs (reflected in operation and maintenance expense) and interest expense which were previously allocated to the refining business and Fidelity and do not meet the criteria for income (loss) from discontinued operations. The Other category also includes Centennial Resources' former investment in Brazil.

Discontinued operations includes the results and supporting activities of Dakota Prairie Refining and Fidelity other than certain general and administrative costs and interest expense as described above. For more information on discontinued operations, see Note 10.

The information below follows the same accounting policies as described in Note 1 of the Company's Notes to Consolidated Financial Statements in the 2017 Annual Report. Information on the Company's segments was as follows:



	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2018			2017			2018			2017
	(In thousands)
External operating revenues:
Regulated operations:
Electric	$	78,499		$	74,574		$	165,904		$	162,799
Natural gas distribution	129,540			131,592			462,204			474,111
Pipeline and midstream	18,645			19,319			23,035			22,190
	226,684			225,485			651,143			659,100
Nonregulated operations:
Pipeline and midstream	5,415			4,520			9,858			8,163
Construction materials and contracting	509,388			501,426			722,672			702,203
Construction services	323,020			336,009			657,071			635,580
Other	90			199			146			519
	837,913			842,154			1,389,747			1,346,465
Total external operating revenues	$	1,064,597		$	1,067,639		$	2,040,890		$	2,005,565

Intersegment operating revenues:
Regulated operations:
Electric	$	—		$	—		$	—		$	—
Natural gas distribution	—			—			—			—
Pipeline and midstream	6,446			6,353			28,182			27,841
	6,446			6,353			28,182			27,841
Nonregulated operations:
Pipeline and midstream	93			59			116			93
Construction materials and contracting	235			172			336			258
Construction services	540			295			550			301
Other	2,667			1,758			5,306			3,501
	3,535			2,284			6,308			4,153
Intersegment eliminations	(9,981		)	(8,637		)	(34,490		)	(31,994		)
Total intersegment operating revenues	$	—		$	—		$	—		$	—



	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2018			2017			2018			2017
	(In thousands)
Earnings (loss) on common stock:
Regulated operations:
Electric	$	9,133		$	7,859		$	22,216		$	22,191
Natural gas distribution	(6,852		)	(2,797		)	25,771			25,064
Pipeline and midstream	5,240			5,492			10,699			10,048
	7,521			10,554			58,686			57,303
Nonregulated operations:
Pipeline and midstream	467			(238		)	288			(865		)
Construction materials and contracting	24,336			21,168			815			1,255
Construction services	14,088			12,391			29,179			19,753
Other	(2,337		)	(2,163		)	(2,932		)	(2,440		)
	36,554			31,158			27,350			17,703
Intersegment eliminations*	—			2,093			—			4,266
Earnings on common stock before income (loss) from discontinued operations	44,075			43,805			86,036			79,272
Income (loss) from discontinued operations, net of tax*	(273		)	(3,190		)	203			(1,504		)
Total earnings on common stock	$	43,802		$	40,615		$	86,239		$	77,768


*	Includes the eliminations for the presentation of income tax adjustments between continuing and discontinued operations.