Segment Reporting

3 Months Ended

Sep. 30, 2015

Segment Reporting [Abstract]

Segment Reporting

Note  10. Segment Reporting

The Company reports its business segments using the “management approach” model for segment reporting. This means that the Company determines its reportable business segments based on the way the chief operating decision maker organizes business segments within the Company for making operating decisions and assessing performance.

The Company reports its financial results in the following three segments: (i) II-VI Laser Solutions, (ii) II-VI Photonics, and (iii) II-VI Performance Products, and the Company’s chief operating decision maker receives and reviews financial information based on these segments.  The Company evaluates business segment performance based upon segment operating income, which is defined as earnings before income taxes, interest and other income or expense. The segments are managed separately due to the market, production requirements and facilities unique to each segment.

The II-VI Laser Solutions segment is located in the U.S., Singapore, China, Germany, Switzerland, Japan, Belgium, the U.K., Italy, South Korea and the Philippines. II-VI Laser Solutions is directed by the President of II-VI Laser Solutions, while each geographic location is directed by a general manager, and is further divided into production and administrative units that are directed by managers. II-VI Laser Solutions designs, manufactures and markets optical and electro-optical components and materials sold under the II-VI Infrared brand name and used primarily in high-power CO₂ lasers. II-VI Laser Solutions also manufactures fiber-delivered beam delivery systems and processing tools and direct diode lasers for industrial lasers sold under the II-VI HIGHYAG and II-VI Laser Enterprise brand names.

The II-VI Photonics segment is located in the U.S., China, Vietnam, Germany, Japan, the U.K., Italy and Hong Kong. II-VI Photonics is directed by the President of II-VI Photonics and is further divided into production and administrative units that are directed by managers. II-VI Photonics manufactures crystal materials, optics, microchip lasers and opto-electronic modules for use in optical communication networks and other diverse consumer and commercial applications.  In addition, the segment also manufactures pump lasers, and optical amplifiers and micro-optics for optical amplifiers for both terrestrial and submarine applications within the optical communications market.

The II-VI Performance Products segment is located in the U.S., Vietnam, Japan, China, Germany and the Philippines. II-VI Performance Products is directed by a Corporate Executive Vice President, while each geographic location is directed by a general manager. II-VI Performance Products is further divided into production and administrative units that are directed by managers. II-VI Performance Products designs, manufactures and markets infrared optical components and high-precision optical assemblies for military, medical and commercial laser imaging applications.  In addition, the segment designs, manufactures and markets unique engineered materials for thermo-electric and silicon carbide applications servicing the semiconductor, military and medical markets.

The accounting policies of the segments are the same as those of the Company. The Company’s corporate expenses are allocated to the segments. The Company evaluates segment performance based upon reported segment operating income, which is defined as earnings from continuing operations before income taxes, interest and other income or expense. Inter-segment sales and transfers have been eliminated.

The following tables summarize selected financial information of the Company’s operations by segment ($000):

	Three Months Ended September 30, 2015
	II-VI				II-VI
	Laser		II-VI		Performance
	Solutions		Photonics		Products		Eliminations			Total
Revenues	$	71,583	$	71,895	$	45,729	$	-		$	189,207
Inter-segment revenues		4,530		3,031		2,395		(9,956	)		-
Operating income		12,175		6,284		3,269		-			21,728
Interest expense		-		-		-		-			(649	)
Other income (expense), net		-		-		-		-			1,057
Income taxes		-		-		-		-			(4,922	)
Net earnings		-		-		-		-			17,214
Depreciation and amortization		3,704		5,093		4,508		-			13,305
Segment assets		331,159		429,764		273,103		-			1,034,026
Expenditures for property, plant and equipment		5,880		2,152		1,392		-			9,424
Investment		-		-		12,178		-			12,178
Goodwill		43,580		98,124		52,890		-			194,594

	Three Months Ended September 30, 2014
	II-VI				II-VI
	Laser		II-VI		Performance
	Solutions		Photonics		Products		Eliminations			Total
Revenues	$	72,824	$	63,613	$	49,396	$	-		$	185,833
Inter-segment revenues		5,064		2,820		2,228		(10,112	)		-
Operating income		12,923		2,072		4,401		-			19,396
Interest expense		-		-		-		-			(1,204	)
Other income (expense), net		-		-		-		-			(1,682	)
Income taxes		-		-		-		-			(4,208	)
Net earnings		-		-		-		-			12,302
Depreciation and amortization		3,533		5,522		4,506		-			13,561
Expenditures for property, plant and equipment		16,066		2,893		2,571		-			21,530