XML 73 R26.htm IDEA: XBRL DOCUMENT v2.4.0.8
Segment Reporting
 3 Months Ended
Mar. 31, 2014
Segment Reporting [Abstract]  
SEGMENT REPORTING
SEGMENT REPORTING

Our operating segments are aggregated into reportable business segments based upon similar economic characteristics, products, services, customers and delivery methods. We operate in two reportable business segments: (1) FMS, which provides full service leasing, contract maintenance, contract-related maintenance and commercial rental of trucks, tractors and trailers to customers, principally in the U.S., Canada and the U.K.; and (2) SCS, which provides comprehensive supply chain management solutions including distribution and transportation services in North America and Asia. The SCS segment also provides dedicated services, which includes vehicles and drivers as part of a dedicated transportation solution in the U.S.

Our primary measurement of segment financial performance, defined as “Earnings Before Tax” (EBT) from continuing operations, includes an allocation of Central Support Services (CSS) and excludes non-operating pension costs, restructuring and other charges, net and the items discussed in Note (P), “Other Items Impacting Comparability.” CSS represents those costs incurred to support all business segments, including human resources, finance, corporate services, public affairs, information technology, health and safety, legal, marketing and corporate communications. The objective of the EBT measurement is to provide clarity on the profitability of each business segment and, ultimately, to hold leadership of each business segment and each operating segment within each business segment accountable for their allocated share of CSS costs. Certain costs are considered to be overhead not attributable to any segment and remain unallocated in CSS. Included among the unallocated overhead remaining within CSS are the costs for investor relations, public affairs and certain executive compensation.

Our FMS segment leases revenue earning equipment and provides fuel, maintenance and other ancillary services to the SCS segment. Inter-segment revenue and EBT are accounted for at rates similar to those executed with third parties. EBT related to inter-segment equipment and services billed to customers (equipment contribution) are included in both FMS and SCS and then eliminated (presented as “Eliminations”). 

The following tables set forth financial information for each of our business segments and provides a reconciliation between segment EBT and earnings from continuing operations before income taxes for the three months ended March 31, 2014 and 2013. Segment results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented.
 
FMS
 
SCS
 
Eliminations
 
Total
 
(In thousands)
 
 
For the three months ended March 31, 2014
 
 
 
 
 
 
Revenue from external customers
$
1,013,396

 
597,341

 
—

 
1,610,737

Inter-segment revenue
121,691

 
—

 
(121,691
)
 
—

Total revenue
$
1,135,087

 
597,341

 
(121,691
)
 
1,610,737

 
 
 
 
 
 
 
 
Segment EBT
$
76,991

 
21,784

 
(9,628
)
 
89,147

Unallocated CSS
 
 
 
 
 
 
(10,829
)
     Non-operating pension costs 
 
 
 
 
 
 
(3,314
)
Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
75,004

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1), (2)
$
568,239

 
3,872

 
—

 
572,111

Unallocated CSS
 
 
 
 
 
 
6,611

Capital expenditures paid
 
 
 
 
 
 
$
578,722

 
 
 
 
 
 
 
 
For the three months ended March 31, 2013
 
 
 
 
 
 
Revenue from external customers
$
986,538

 
576,479

 
—

 
1,563,017

Inter-segment revenue
113,194

 
—

 
(113,194
)
 
—

Total revenue
$
1,099,732

 
576,479

 
(113,194
)
 
1,563,017

 
 
 
 
 
 
 
 
Segment EBT
$
60,745

 
24,436

 
(7,958
)
 
77,223

Unallocated CSS
 
 
 
 
 
 
(11,375
)
Non-operating pension costs 
 
 
 
 
 
 
(5,244
)
Restructuring and other charges, net and other items
 
 
 
 
 
 
1,904

Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
62,508

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1), (2)
$
406,511

 
5,800

 
—

 
412,311

Unallocated CSS
 
 
 
 
 
 
7,743

Capital expenditures paid
 
 
 
 
 
 
$
420,054

 ————————————
(1)
Excludes revenue earning equipment acquired under capital leases.
(2)
Excludes acquisition payments of $1.6 million and $1.4 million during the three months ended March 31, 2014, and 2013, respectively.