Segment Information

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Segment Information

4. SEGMENT INFORMATION

We primarily operate in two reportable business segments: local gas distribution and gas storage. We also have other investments and business activities not specifically related to one of these two reporting segments, which we aggregate and report as other. We refer to our local gas distribution business as the utility, and our gas storage segment and other as non-utility. Our utility segment also includes the utility portion of our Mist underground storage facility in Oregon (Mist) and NWN Gas Reserves, which is a wholly-owned subsidiary of Energy Corp. Our gas storage segment includes NWN Gas Storage, which is a wholly-owned subsidiary of NWN Energy, Gill Ranch, which is a wholly-owned subsidiary of NWN Gas Storage, the non-utility portion of Mist, and all third-party asset management services. Other includes NNG Financial and NWN Energy's equity investment in TWH, which is pursuing development of a cross-Cascades transmission pipeline project. See Note 4 in our 2014 Form 10-K for further discussion of our segments.

Inter-segment transactions are insignificant. The following table presents summary financial information concerning the reportable segments:

	Three Months Ended June 30,
In thousands	Utility		Gas Storage			Other		Total
2015
Operating revenues	$	132,891	$	5,333		$	56	$	138,280
Depreciation and amortization	18,602		1,628			—		20,230
Income from operations	12,163		739			12		12,914
Net income (loss)	2,245		(86		)	38		2,197
Capital expenditures	30,464		473			—		30,937
2014
Operating revenues	$	128,075	$	5,038		$	56	$	133,169
Depreciation and amortization	18,087		1,622			—		19,709
Income (loss) from operations	13,735		(485		)	16		13,266
Net income (loss)	2,205		(1,157		)	23		1,071
Capital expenditures	26,726		175			—		26,901

	Six Months Ended June 30,
In thousands	Utility		Gas Storage		Other		Total
2015
Operating revenues	$	389,197	$	10,636	$	112	$	399,945
Depreciation and amortization	37,077		3,264		—		40,341
Income from operations	64,043		1,794		78		65,915
Net income	30,580		28		75		30,683
Capital expenditures	56,273		1,799		—		58,072
Total assets at June 30, 2015	2,646,457		270,509		14,913		2,931,879
2014
Operating revenues	$	413,570	$	12,873	$	112	$	426,555
Depreciation and amortization	36,054		3,244		—		39,298
Income from operations	85,192		3,068		34		88,294
Net income	38,224		470		261		38,955
Capital expenditures	52,076		413		—		52,489
Total assets at June 30, 2014	2,487,771		282,939		16,404		2,787,114
Total assets at December 31, 2014	$	2,775,011	$	273,813	$	16,121	$	3,064,945

Utility Margin

Utility margin is a financial measure consisting of utility operating revenues, which are reduced by revenue taxes and the associated cost of gas. The cost of gas purchased for utility customers is generally a pass-through cost in the amount of revenues billed to regulated utility customers. By subtracting cost of gas from utility operating revenues, utility margin provides a key metric used by our chief operating decision maker in assessing the performance of the utility segment. The gas storage segment and other emphasize growth in operating revenues as opposed to margin because they do not incur a product cost (i.e. cost of gas sold) like the utility and, therefore, use operating revenues and net income to assess performance.

The following table presents additional segment information concerning utility margin:

	Three Months Ended June 30,				Six Months Ended June 30,
In thousands	2015		2014		2015		2014
Utility margin calculation:
Utility operating revenues	$	132,891	$	128,075	$	389,197	$	413,570
Less: Utility cost of gas	62,176		58,280		187,881		213,481
Utility margin	$	70,715	$	69,795	$	201,316	$	200,089