Segment reporting

3 Months Ended

Mar. 31, 2020

Segment reporting

The Company’s operations are comprised of its U.S. dialysis and related lab services business, its various ancillary services and strategic initiatives, including its international operations, and its corporate administrative support.

On June 19, 2019, the Company completed the sale of its DMG division to Optum, a subsidiary of UnitedHealth Group Inc. As a result of this transaction, DMG's results of operations have been reported as discontinued operations for all periods presented.

The Company’s separate operating segments include its U.S. dialysis and related lab services business, each of its ancillary services and strategic initiatives, its kidney care operations in each foreign sovereign jurisdiction, its other health operations in each foreign sovereign jurisdiction, and its equity method investment in the APAC JV. The U.S. dialysis and related lab services business qualifies as a separately reportable segment, and all other ancillary services and strategic initiatives operating segments, including the international operating segments, have been combined and disclosed in the other segments category. See Note 25 to the Company's consolidated financial statements included in the 10-K for further description of how the Company determines and measures results for its operating segments.

The following is a summary of segment net revenues, segment operating margin (loss), and a reconciliation of segment operating margin to consolidated income before income taxes:



	Three months ended March 31,
	2020			2019
Segment revenues:
U.S. dialysis
Dialysis patient service revenues:
External sources	$	2,579,240		$	2,511,826
Intersegment revenues	31,941			30,420
U.S. dialysis patient service revenues	2,611,181			2,542,246
Other revenues⁽¹⁾:
External sources	5,141			4,684
Intersegment revenues	301			221
Total U.S. dialysis revenues	2,616,623			2,547,151
Other—Ancillary services
Dialysis patient service revenues, net	134,041			117,863
Other external sources	122,815			108,739
Intersegment revenues	4,152			3,336
Total ancillary services revenues	261,008			229,938
Total net segment revenues	2,877,631			2,777,089
Elimination of intersegment revenues	(36,394		)	(33,977		)
Consolidated revenues	$	2,841,237		$	2,743,112
Segment operating margin (loss):
U.S. dialysis	$	491,607		$	416,981
Other—Ancillary services	(2,646		)	(57,630		)
Total segment operating margin	488,961			359,351
Reconciliation of segment operating margin to consolidated income from continuing operations before income taxes:
Corporate administrative support	(23,585		)	(18,844		)
Consolidated operating income	465,376			340,507
Debt expense	(88,603		)	(131,519		)
Debt refinancing charges	(2,948		)	—
Other income, net	(4,350		)	6,940
Consolidated income from continuing operations before income taxes	$	369,475		$	215,928


(1)	Includes management fee revenue from providing management and administrative services to dialysis ventures in which the Company owns a noncontrolling equity investment or which are wholly-owned by third parties.

A summary of assets by reportable segment was as follows:



	March 31, 2020		December 31, 2019
U.S. dialysis (including equity investments of $130,144 and $124,188, respectively)	$	16,075,622	$	15,778,880
Other—Ancillary services (including equity investments of $124,355 and $117,795, respectively)	1,520,678		1,532,514
Consolidated assets	$	17,596,300	$	17,311,394

Depreciation and amortization expense by reportable segment was as follows:



	Three months ended March 31,
	2020		2019
U.S. dialysis	$	146,300	$	140,780
Other—Ancillary services	8,379		7,748
	$	154,679	$	148,528

Expenditures for property and equipment by reportable segment were as follows:



	Three months ended March 31,
	2020		2019
U.S. dialysis	$	148,763	$	170,548
Other—Ancillary services	6,179		8,578
DMG—Discontinued operations	—		19,752
	$	154,942	$	198,878