BUSINESS SEGMENTS

The Company sells its products domestically and internationally and operates within three industry segments: Feed Ingredients, Food Ingredients and Fuel Ingredients. The measure of segment profit (loss) includes all revenues, operating expenses (excluding certain amortization of intangibles), and selling, general and administrative expenses incurred at all operating locations and excludes general corporate expenses.

Included in corporate activities are general corporate expenses and the amortization of intangibles. Assets of corporate activities include cash, unallocated prepaid expenses, deferred tax assets, prepaid pension, and miscellaneous other assets.

Feed Ingredients

Feed Ingredients consists principally of (i) the Company's U.S. ingredients business, including the Company's fats and proteins, used cooking oil, trap grease and food residuals collection businesses, the Rothsay ingredients business, and the ingredients and specialty products businesses conducted by Darling Ingredients International under the Sonac name (proteins, fats, and plasma products) and (ii) the Company's bakery residuals business.

Food Ingredients

Food Ingredients consists principally of (i) the gelatin and collagen hydrolysates business conducted by Darling Ingredients International under the Rousselot name, (ii) the natural casings and meat-by-products business conducted by Darling Ingredients International under the CTH name and (iii) certain specialty products businesses conducted by Darling Ingredients International under the Sonac name.

Fuel Ingredients

The Company's Fuel Ingredients segment consists of (i) the Company's biofuel business conducted under the Dar Pro® and Rothsay names (ii) the bioenergy business conducted by Darling Ingredients International under the Ecoson and Rendac names and (iii) the Company's investment in the DGD Joint Venture.

The Fuel Ingredients segment results did not include any blenders tax credits in fiscal 2017. In February 2018, the blender tax credits for calendar year 2017 were retroactively reinstated by the U.S. Congress. The Fuel Ingredients segment is expected to receive approximately $12.6 million in fiscal 2018 for these reinstated blenders tax credits.

Business Segments (in thousands):



	Feed Ingredients		Food Ingredients		Fuel Ingredients		Corporate			Total
Fiscal Year Ended December 30, 2017
Net Sales	$	2,239,492	$	1,156,976	$	265,783	$	—		$	3,662,251
Cost of sales and operating expenses	1,744,768		920,575		210,508		—			2,875,851
Gross Margin	494,724		236,401		55,275		—			786,400

Selling, general and administrative expense	180,866		104,982		10,467		51,172			347,487
Depreciation and amortization	184,172		75,010		31,019		11,899			302,100
Segment operating income/(loss)	129,686		56,409		13,789		(63,071		)	136,813

Equity in net income of unconsolidated subsidiaries	265		—		28,239		—			28,504
Segment income	129,951		56,409		42,028		(63,071		)	165,317

Total other expense										(101,117		)
Income before income taxes										$	64,200

Segment assets at December 30, 2017	$	2,614,545	$	1,499,027	$	688,890	$	155,763		$	4,958,225



	Feed Ingredients		Food Ingredients		Fuel Ingredients		Corporate			Total
Fiscal Year Ended December 31, 2016
Net Sales	$	2,089,145	$	1,055,725	$	247,058	$	—		$	3,391,928
Cost of sales and operating expenses	1,624,858		828,223		182,466		—			2,635,547
Gross Margin	464,287		227,502		64,592		—			756,381

Selling, general and administrative expense	169,648		96,170		6,895		41,292			314,005
Acquisition costs	—		—		—		401			401
Depreciation and amortization	178,845		70,120		28,531		12,412			289,908
Segment operating income/(loss)	115,794		61,212		29,166		(54,105		)	152,067

Equity in net income of unconsolidated subsidiaries	467		—		69,912		—			70,379
Segment income	116,261		61,212		99,078		(54,105		)	222,446

Total other expense										(99,907		)
Income before income taxes										$	122,539

Segment assets at December 31, 2016	$	2,464,509	$	1,414,409	$	657,637	$	161,462		$	4,698,017



	Feed Ingredients		Food Ingredients		Fuel Ingredients		Corporate			Total
Fiscal Year Ended January 2, 2016
Net Sales	$	2,074,333	$	1,088,727	$	228,195	$	—		$	3,391,255
Cost of sales and operating expenses	1,613,402		863,562		177,061		—			2,654,025
Gross Margin	460,931		225,165		51,134		—			737,230

Selling, general and administrative expense	178,624		97,110		7,264		33,385			316,383
Acquisition costs	—		—		—		8,299			8,299
Depreciation and amortization	165,854		66,817		26,711		10,522			269,904
Segment operating income/(loss)	116,453		61,238		17,159		(52,206		)	142,644

Equity in net income of unconsolidated subsidiaries	1,521		—		71,895		—			73,416
Segment income	117,974		61,238		89,054		(52,206		)	216,060

Total other expense										(117,280		)
Income before income taxes										$	98,780

Business Segment Property, Plant and Equipment (in thousands):



	December 30, 2017		December 31, 2016		January 2, 2016
Depreciation and amortization:
Feed Ingredients	$	184,172	$	178,845	$	165,854
Food Ingredients	75,010		70,120		66,817
Fuel Ingredients	31,019		28,531		26,711
Corporate Activities	11,899		12,412		10,522
Total	$	302,100	$	289,908	$	269,904
Capital expenditures:
Feed Ingredients	$	191,953	$	167,313	$	153,894
Food Ingredients	50,099		50,020		49,066
Fuel Ingredients	24,707		22,323		19,478
Corporate Activities	7,409		3,867		7,410
Total (a)	$	274,168	$	243,523	$	229,848


(a)	Excludes immaterial capital assets acquired by acquisition in fiscal 2017, fiscal 2016 and fiscal 2015.

Geographic Area Net Trade Revenues (in thousands):



	December 30, 2017		December 31, 2016		January 2, 2016
North America	$	1,937,027	$	1,817,659	$	1,951,421
Europe	1,372,750		1,225,397		1,066,779
China	209,780		218,480		234,978
South America	60,111		55,089		62,035
Other	82,583		75,303		76,042
Total	$	3,662,251	$	3,391,928	$	3,391,255

The Company attributes revenues from external customers to individual foreign countries based on the origin of the Company's shipments.

Long-lived assets related to the Company's operations in North America, Europe, China, South American and other were as follows (in thousands):



	FY 2017		FY 2016
	Long-Lived Assets		Long-Lived Assets
North America	$	2,468,111	$	2,411,489
Europe	1,292,020		1,158,087
China	151,760		152,150
South America	81,247		74,837
Other	8,642		8,152
Total	$	4,001,780	$	3,804,715