Segment Reporting

3 Months Ended

Mar. 31, 2015

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. During the first quarter of 2015, our management structure changed within the supply chain business. We created the role of President of DTS for the dedicated product offering which was within SCS. Beginning with the three-month period ended March 31, 2015, we are reporting our financial performance based on three business segments: (1) FMS, which provides full service leasing, commercial rental, contract maintenance, and contract-related maintenance of trucks, tractors and trailers to customers principally in the U.S., Canada and the U.K.; (2) DTS, which provides vehicles and drivers as part of a dedicated transportation solution in the U.S; and (3) SCS, which provides comprehensive supply chain solutions including distribution and transportation services in North America and Asia. Dedicated services provided as part of an integrated, multi-service, supply chain solution will continue to be reported in the SCS business segment where those services will continue to be managed.

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 other items discussed in Note (N), "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 DTS and SCS segments. 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 the business segment which served the customer 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 endedMarch 31, 2015 and 2014. 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		DTS	SCS	Eliminations		Total
For the three months ended March 31, 2015
Revenue from external customers	$	983,440	212,659	371,054	—		1,567,153
Inter-segment revenue	103,710		—	—	(103,710	)	—
Total revenue	$	1,087,150	212,659	371,054	(103,710	)	1,567,153
Segment EBT	$	89,919	8,970	15,689	(11,534	)	103,044
Unallocated CSS							(11,942		)
Non-operating pension costs							(4,883		)
Restructuring and other charges, net and other items (1)							(1,841		)
Earnings from continuing operations before income taxes							$	84,378
Segment capital expenditures paid (2)	$	538,743	709	5,987	—		545,439
Unallocated CSS							7,803
Capital expenditures paid							$	553,242
For the three months ended March 31, 2014
Revenue from external customers	$	1,013,396	215,962	381,379	—		1,610,737
Inter-segment revenue	121,691		—	—	(121,691	)	—
Total revenue	$	1,135,087	215,962	381,379	(121,691	)	1,610,737
Segment EBT	$	76,991	8,686	13,098	(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 (2), (3)	$	568,239	250	3,622	—		572,111
Unallocated CSS							6,611
Capital expenditures paid							$	578,722

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(1) See Note (N), "Other Items Impacting Comparability," for additional information.

(2) Excludes revenue earning equipment acquired under capital leases.

(3) Excludes acquisition payments of $1.6 million during the three months ended March 31, 2014.