(16) Segments and Foreign Operations

The Company is a global solutions provider to the world of essential natural resources – water, minerals and energy. Management defines the Company’s operational and organizational structure into discrete divisions based on its primary product lines. Each division comprises a combination of individual district offices, which primarily offer similar types of services and serve similar types of markets. Although individual offices within a division may periodically perform services normally provided by another division, the results of those services are recorded in the offices’ own division. For example, if a Mineral Exploration Division office performed water well drilling services, the revenues would be recorded in the Mineral Exploration Division rather than the Water Resources Division.

The Company’s segments are defined as follows:

Water Resources Division

Our Water Resources Division provides our customers with every aspect of water supply system development and technology, including hydrologic design and construction, source of supply exploration, well and intake construction and well and pump rehabilitation. The division also brings new technologies to the water and wastewater markets and offers water treatment equipment engineering services, providing systems for the treatment of regulated and “nuisance” contaminants, specifically, iron, manganese, hydrogen sulfide, arsenic, radium, nitrate, perchlorate, and volatile organic compounds. The Water Resources Division provides water systems and services in most regions of the U.S.

Inliner Division

Our Inliner Division provides a wide range of process, sanitary and storm water rehabilitation solutions to municipalities and industrial customers dealing with aging infrastructure needs. We focus on our proprietary Inliner® cured-in-place pipe (“CIPP”) which allows us to rehabilitate aging sanitary sewer, storm water and process water infrastructure to provide structural rebuilding as well as infiltration and inflow reduction. Our trenchless technology minimizes environmental impact and reduces or eliminates surface and social disruption. We are somewhat unique in that the technology itself, the liner tube manufacturer and the largest installer of the Inliner CIPP technology are all housed within our family of companies. While we focus on our proprietary Inliner CIPP, we are committed to full system renewal. We also provide a wide variety of other rehabilitative methods including Janssen structural renewal for service lateral connections and mainlines, slip lining, traditional excavation and replacement, U-Liner high-density polyethylene fold and form and manhole renewal with cementitious and epoxy products. The Inliner Division provides services in most regions of the U.S.

Heavy Civil Division

Our Heavy Civil Division delivers sustainable solutions to government agencies and industrial clients by overseeing the design and construction of water and wastewater treatment plants and pipeline installation. In addition, Heavy Civil builds radial collector wells (Ranney Method), surface water intakes, pumping stations, hard rock tunnels and marine construction services – all in support of the world’s water infrastructure. Beyond water solutions, our Heavy Civil Division also designs and constructs biogas facilities (anaerobic digesters) for the purpose of generating and capturing methane gas, an emerging renewable energy resource. The Heavy Civil Division provides services in most regions of the U.S.

Geoconstruction Division

We provide specialized geotechnical foundation construction services to the heavy civil, industrial, commercial and private construction markets around the globe. We have the expertise and equipment to provide the most appropriate deep foundation system, ground improvement and earth support solution to be applied given highly variable geological and site conditions. In addition, we offer extensive experience in successful completion of complex and schedule-driven major underground construction projects. We provide services that are focused primarily on the foundation systems for dams/levees, tunnel shafts, utility systems, subways or transportation systems, commercial building and port facilities. Services offered include jet grouting, structural diaphragm and slurry cutoff walls, cement and chemical grouting, drilled piles, ground improvement and earth retention systems. The Geoconstruction Division provides services in most regions of the U.S., as well as Brazil and Uruguay.

Mineral Exploration Division

Our Mineral Exploration Division conducts primarily aboveground drilling activities, including all phases of core drilling, reverse circulation, dual tube, hammer and rotary air-blast methods. Our service offerings include both exploratory (‘greenfield’) and definition (‘brownfield’) drilling. Global mining companies hire us to extract samples from their sites that they analyze for mineral content before investing heavily in development to extract the minerals. We help our clients determine if a minable mineral deposit exists on the site, the economic viability of mining the site and the geological properties of the ground, which helps in the determination of mine planning. Our primary markets are in the western U.S., Mexico, Australia, Brazil and Africa. We also have ownership interests in foreign affiliates operating in Latin America that form our primary presence in this market.

Other

Other includes our Layne Energy Services initiative of expanding water related services to the energy markets and any other specialty operations not included in one of the other divisions.

Financial information for the Company’s segments is presented below. Unallocated corporate expenses primarily consist of general and administrative functions performed on a company-wide basis and benefiting all segments. These costs include accounting, financial reporting, internal audit, treasury, corporate and securities law, tax compliance, executive management and board of directors. Corporate assets are all assets of the Company not directly associated with a segment, and consist primarily of cash and deferred income taxes.

	Years Ended January 31,
(in thousands)	2013			2012			2011
Revenues
Water Resources	$	278,529		$	274,556		$	248,907
Inliner		133,256			132,108			116,566
Heavy Civil		278,131			343,760			353,304
Geoconstruction		133,247			89,210			77,969
Water Infrastructure Group		823,163			839,634			796,746
Mineral Exploration		246,582			268,909			199,946
Other		5,879			4,215			3,213
Total revenues	$	1,075,624		$	1,112,758		$	999,905

Equity in earnings of affiliates
Geoconstruction	$	3,872		$	3,345		$	517
Mineral Exploration		16,700			21,302			12,636
Total equity in earnings of affiliates	$	20,572		$	24,647		$	13,153

Income (loss) from continuing operations before income taxes
Water Resources	$	4,426		$	(5,967	)	$	17,377
Inliner		9,936			(13,236	)		9,426
Heavy Civil		(32,308	)		(61,649	)		9,637
Geoconstruction		517			12,828			11,708
Water Infrastructure Group		(17,429	)		(68,024	)		48,148
Mineral Exploration		45,969			62,259			34,947
Other		(7,445	)		(4,520	)		(400	)
Unallocated corporate expenses		(36,009	)		(30,866	)		(30,224	)
Interest expense		(4,309	)		(2,357	)		(1,594	)
Total (loss) income from continuing operations before income taxes	$	(19,223	)	$	(43,508	)	$	50,877

Investment in affiliates
Geoconstruction	$	384		$	20,011		$	16,666
Mineral Exploration		77,906			68,286			52,486
Total investment in affiliates	$	78,290		$	88,297		$	69,152

	As of and Years Ended January 31,
(in thousands)	2013		2012		2011
Revenues by product line
Water systems	$	219,693	$	208,558	$	181,281
Water treatment technologies		54,276		51,410		49,109
Sewer rehabilitation		133,256		132,108		116,757
Water and wastewater plant construction		129,446		200,513		237,360
Pipeline construction		108,408		112,446		85,486
Soil stabilization		167,711		115,402		100,685
Environmental and specialty drilling		7,246		17,902		14,312
Exploration drilling		249,247		271,442		201,479
Other		6,341		2,977		13,436
Total revenues by product line	$	1,075,624	$	1,112,758	$	999,905

Capital expenditures
Water Resources	$	36,077	$	27,816	$	28,535
Inliner		2,579		3,218		2,938
Heavy Civil		1,088		5,413		4,302
Geoconstruction		6,760		8,240		3,242
Mineral Exploration		24,682		16,921		19,309
Other		1,650		2,529		2,717
Discontinued operations		1,672		4,126		3,289
Corporate		2,995		2,563		2,871
Total capital expenditures	$	77,503	$	70,826	$	67,203

Depreciation and amortization
Water Resources	$	15,285	$	14,222	$	12,405
Inliner		2,647		2,880		2,332
Heavy Civil		7,096		7,389		7,095
Geoconstruction		11,413		8,819		3,619
Mineral Exploration		19,030		15,145		13,070
Other		550		5,381		4,712
Corporate		5,376		2,204		1,604
Total depreciation and amortization	$	61,397	$	56,040	$	44,837

Assets
Water Resources	$	154,207	$	194,902	$	178,744
Inliner		67,027		61,601		46,262
Heavy Civil		114,361		123,475		187,333
Geoconstruction		170,064		113,612		118,805
Mineral Exploration		213,908		203,277		165,230
Other		6,804		13,585		15,600
Discontinued operations		-		52,893		57,047
Corporate		85,855		42,491		47,631
Total assets	$	812,226	$	805,836	$	816,652

	As of and Years Ended January 31,
(in thousands)	2013		2012		2011
Geographic Information :
Revenues
United States	$	839,337	$	877,757	$	832,465
Africa/Australia		88,888		110,012		79,546
Mexico		69,970		58,166		43,734
Other foreign		77,429		66,823		44,160
Total revenues	$	1,075,624	$	1,112,758	$	999,905

Property and equipment, net
United States	$	177,198	$	231,838	$	215,966
Africa/Australia		29,875		24,900		24,749
Mexico		10,582		9,559		9,311
Other foreign		48,885		11,060		9,830
Total property and equipment, net	$	266,540	$	277,357	$	259,856