

(21) Segment and Related Information

Our reportable business segments are primarily engaged in the electric and natural gas business. The remainder of our operations are presented as other, which primarily consists of unallocated corporate costs and unregulated activity.

We evaluate the performance of these segments based on gross margin. The accounting policies of the operating segments are the same as the parent except that the parent allocates some of its operating expenses to the operating segments according to a methodology designed by management for internal reporting purposes and involves estimates and assumptions.

Financial data for the business segments for the twelve months ended are as follows (in thousands):



December 31, 2018	Electric			Gas			Other			Eliminations		Total
Operating revenues	$	921,093		$	270,916		$	—		$	—	$	1,192,009
Cost of sales	194,608			78,275			—			—		272,883
Gross margin	726,485			192,641			—			—		919,126
Operating, general and administrative	223,598			82,864			657			—		307,119
Property and other taxes	134,681			36,569			9			—		171,259
Depreciation and depletion	144,636			29,822			18			—		174,476
Operating income (loss)	223,570			43,386			(684		)	—		266,272
Interest expense, net	(79,033		)	(5,858		)	(7,097		)	—		(91,988		)
Other income, net	2,794			962			210			—		3,966
Income tax benefit (expense)	21,686			9,268			(12,244		)	—		18,710
Net income (loss)	$	169,017		$	47,758		$	(19,815	)	$	—	$	196,960
Total assets	$	4,512,392		$	1,127,252		$	4,732		$	—	$	5,644,376
Capital expenditures	$	221,968		$	61,998		$	—		$	—	$	283,966



December 31, 2017	Electric			Gas			Other			Eliminations		Total
Operating revenues	$	1,037,053		$	268,599		$	—		$	—	$	1,305,652
Cost of sales	334,029			76,320			—			—		410,349
Gross margin	703,024			192,279			—			—		895,303
Operating, general and administrative (1)	216,003			78,757			43			—		294,803
Property and other taxes	127,391			35,214			9			—		162,614
Depreciation and depletion	136,556			29,548			33			—		166,137
Operating income (loss)	223,074			48,760			(85		)	—		271,749
Interest expense, net	(82,454		)	(5,920		)	(3,889		)	—		(92,263		)
Other (loss) income, net (1)	(3,487		)	(878		)	950			—		(3,415		)
Income tax (expense) benefit	(7,424		)	(6,684		)	740			—		(13,368		)
Net income (loss)	$	129,709		$	35,278		$	(2,284	)	$	—	$	162,703
Total assets	$	4,346,484		$	1,071,847		$	2,586		$	—	$	5,420,917
Capital expenditures	$	226,077		$	50,361		$	—		$	—	$	276,438



December 31, 2016	Electric			Gas			Other			Eliminations		Total
Operating revenues	$	1,011,595		$	245,652		$	—		$	—	$	1,257,247
Cost of sales	332,817			68,156			—			—		400,973
Gross margin	678,778			177,496			—			—		856,274
Operating, general and administrative (1)	210,523			83,896			(556		)	—		293,863
Property and other taxes	115,583			32,505			10			—		148,098
Depreciation and depletion	130,236			29,067			33			—		159,336
Operating income	222,436			32,028			513			—		254,977
Interest expense, net	(86,038		)	(6,589		)	(2,343		)	—		(94,970		)
Other (loss) income, net (1)	(2,967		)	(1,488		)	973			—		(3,482		)
Income tax benefit (expense)	7,392			(1,687		)	1,942			—		7,647
Net income	$	140,823		$	22,264		$	1,085		$	—	$	164,172
Total assets	$	4,363,848		$	1,129,355		$	6,118		$	—	$	5,499,321
Capital expenditures	$	236,014		$	51,887		$	—		$	—	$	287,901

_____________

(1) We adopted ASU 2017-07 on January 1, 2018. As a result, we recorded the non-service cost component of net periodic benefit cost within other income (expense), net. We adopted this standard retrospectively and $7.5 million and $2.9 million, respectively, were reclassified from electric and gas operating, general and administrative expenses to other income (expense), net for the twelve months ended December 31, 2017, to conform to current period presentation. For the twelve months ended December 31, 2016, $6.2 million and $2.8 million respectively, were reclassified from electric and gas operating, general and administrative expenses to other income (expense), net.