10.	Segment Information :

The Company follows the accounting guidance that requires the utilization of a “management approach” to define and report the financial results of operating segments. The management approach defines operating segments along the lines used by the Company’s chief operating decision maker (CODM) to assess performance and make operating and resource allocation decisions. Our CODM evaluates performance and allocates resources based primarily on operating income (loss). Our operating segments are based primarily on internal management reporting.

The Company operates in

three

reportable segments; carbon flat products, specialty metals flat products, and tubular and pipe products. The flat products segments’ assets and resources are shared by the carbon and specialty metals segments and both segments’ products are stored in the shared facilities and, in some locations, processed on shared equipment. As such, total assets and capital expenditures are reported in the aggregate for the flat products segments. Due to the shared assets and resources, certain of the flat products segment expenses are allocated between the carbon flat products segment and the specialty metals flat products segment based upon an established allocation methodology. Through its carbon flat products segment, the Company sells and distributes large volumes of processed carbon and coated flat-rolled sheet, coil and plate products. Through its specialty metals flat products segment, the Company sells and distributes processed aluminum and stainless flat-rolled sheet and coil products, flat bar products and fabricated parts. Through its tubular and pipe products segment, the Company distributes metal tubing, pipe, bar, valve and fittings and fabricates pressure parts supplied to various industrial markets.

Corporate expenses are reported as a separate line item for segment reporting purposes. Corporate expenses include the unallocated expenses related to managing the entire Company (i.e., all

three

segments), including compensation for certain personnel, expenses related to being a publicly traded entity such as board of directors’ expenses, audit expenses, and various other professional fees.

The following table provides financial information by segment and reconciles the Company’s operating income by segment to the consolidated income before income taxes for the

three

months ended

March

31,

2017

and

2016.

	For the Three Months Ended
	March 31,
(in thousands)	2017			2016
Net sales
Carbon flat products	$	216,916		$	161,434
Specialty metals flat products		57,955			45,830
Tubular and pipe products		60,022			51,085
Total net sales	$	334,893		$	258,349

Depreciation and amortization
Carbon flat products	$	2,889		$	2,954
Specialty metals flat products		226			193
Tubular and pipe products		1,396			1,559
Corporate		25			25
Total depreciation and amortization	$	4,536		$	4,731

Operating income (loss)
Carbon flat products	$	7,375		$	(2,178	)
Specialty metals flat products		3,985			1,756
Tubular and pipe products		2,487			2,243
Corporate expenses		(2,796	)		(1,786	)
Total operating income	$	11,051		$	35
Other income (loss), net		(26	)		(5	)
Income before interest and income taxes		11,025			30
Interest and other expense on debt		1,626			1,285
Income (loss) before income taxes	$	9,399		$	(1,255	)

	For the Three Months Ended
	March 31,
(in thousands)	2017		2016
Capital expenditures
Flat products segments	$	1,405	$	1,234
Tubular and pipe products		661		162
Total capital expenditures	$	2,066	$	1,396

	As of
	March 31,		December 31,
(in thouands)	2017		2016
Assets
Flat products segments	$	403,492	$	363,626
Tubular and pipe products		195,248		192,088
Corporate		329		354
Total assets	$	599,069	$	556,068

There were no material revenue transactions between the carbon flat products, specialty metals products, and tubular and pipe products segments.

The Company sells certain products internationally, primarily in Canada, Mexico and Dominican Republic. International sales are immaterial to the consolidated financial results and to the individual segments’ results.