SEGMENT INFORMATION

Wabtec has two reportable segments—the Freight Segment and the Transit Segment. The key factors used to identify these reportable segments are the organization and alignment of the Company’s internal operations, the nature of the products and services, and customer type. The business segments are:

Freight Segment primarily manufactures and services components for new and existing freight cars and locomotives, builds new switcher locomotives, rebuilds freight locomotives, supplies railway electronics, positive train control equipment, signal design and engineering services, and provides related heat exchange and cooling systems. Customers include large, publicly traded railroads, leasing companies, manufacturers of original equipment such as locomotives and freight cars, and utilities.

Transit Segment primarily manufactures and services components for new and existing passenger transit vehicles, typically regional trains, high speed trains, subway cars, light-rail vehicles and buses, builds new commuter locomotives, refurbishes subway cars, provides heating, ventilation, and air conditioning equipment, and doors for buses and subways. Customers include public transit authorities and municipalities, leasing companies, and manufacturers of subway cars and buses around the world.

The Company evaluates its business segments’ operating results based on income from operations. Intersegment sales are accounted for at prices that are generally established by reference to similar transactions with unaffiliated customers. Corporate activities include general corporate expenses, elimination of intersegment transactions, interest income and expense and other unallocated charges. Since certain administrative and other operating expenses and other items have not been allocated to business segments, the results in the following tables are not necessarily a measure computed in accordance with generally accepted accounting principles and may not be comparable to other companies.



Segment financial information for 2017 is as follows:
					Corporate
	Freight		Transit		Activities and
In thousands	Segment		Segment		Elimination			Total
Sales to external customers	$	1,396,588	$	2,485,168	$	—		$	3,881,756
Intersegment sales/(elimination)	37,630		21,548		(59,178		)	—
Total sales	$	1,434,218	$	2,506,716	$	(59,178	)	$	3,881,756
Income (loss) from operations	$	264,603	$	188,546	$	(31,416	)	$	421,733
Interest expense and other, net	—		—		(69,670		)	(69,670		)
Income (loss) from operations before income taxes	$	264,603	$	188,546	$	(101,086	)	$	352,063
Depreciation and amortization	$	43,721	$	57,441	$	2,086		$	103,248
Capital expenditures	33,921		50,762		4,783			89,466
Segment assets	3,504,289		7,562,122		(4,486,431		)	6,579,980

Segment financial information for 2016 is as follows:
					Corporate
	Freight		Transit		Activities and
In thousands	Segment		Segment		Elimination			Total
Sales to external customers	$	1,543,098	$	1,388,090	$	—		$	2,931,188
Intersegment sales/(elimination)	39,519		9,393		(48,912		)	$	—
Total sales	$	1,582,617	$	1,397,483	$	(48,912	)	$	2,931,188
Income (loss) from operations	$	344,455	$	171,446	$	(57,540	)	$	458,361
Interest expense and other, net	—		—		(45,524		)	(45,524		)
Income (loss) from operations before income taxes	$	344,455	$	171,446	$	(103,064	)	$	412,837
Depreciation and amortization	$	36,519	$	31,545	$	1,731		$	69,795
Capital expenditures	22,726		20,987		6,503			50,216
Segment assets	2,949,668		6,720,302		(3,088,952		)	6,581,018



Segment financial information for 2015 is as follows:
					Corporate
	Freight		Transit		Activities and
In thousands	Segment		Segment		Elimination			Total
Sales to external customers	$	2,054,715	$	1,235,283	$	—		$	3,307,998
Intersegment sales/(elimination)	35,372		10,895		(46,267		)	—
Total sales	$	2,090,087	$	1,264,178	$	(46,267	)	$	3,307,998
Income (loss) from operations	$	482,640	$	150,988	$	(26,061	)	$	607,567
Interest expense and other, net	—		—		(22,199		)	(22,199		)
Income (loss) from operations before income taxes	$	482,640	$	150,988	$	(48,260	)	$	585,368
Depreciation and amortization	$	36,834	$	26,196	$	1,704		$	64,734
Capital expenditures	24,715		22,996		1,717			49,428
Segment assets	2,708,724		2,202,614		(1,681,825		)	3,229,513

The following geographic area data as of and for the years ended December 31, 2017, 2016 and 2015, respectively, includes net sales based on product shipment destination and long-lived assets, which consist of plant, property and equipment, net of depreciation, resident in their respective countries:



	Net Sales						Long-Lived Assets
In thousands	2017		2016		2015		2017		2016		2015
United States	$	1,323,781	$	1,362,255	$	1,754,924	$	211,608	$	205,895	$	171,362
United Kingdom	356,493		322,563		368,505		57,668		54,215		63,694
Canada	279,013		206,258		204,674		5,822		5,156		4,876
France	237,454		66,287		45,565		57,849		33,636		7,194
Germany	208,817		98,364		92,422		71,709		57,902		31,642
China	178,137		106,357		100,586		36,388		42,672		12,256
Mexico	160,029		183,583		190,034		9,117		8,766		8,839
Italy	142,037		45,771		38,164		30,329		27,253		15,170
India	137,837		24,161		12,345		12,519		1,271		1,946
Australia	136,127		82,099		86,809		10,483		8,039		8,424
Brazil	69,378		51,493		84,595		13,184		13,227		9,318
Other international	652,653		381,997		329,375		57,296		60,344		18,472
Total	$	3,881,756	$	2,931,188	$	3,307,998	$	573,972	$	518,376	$	353,193

Export sales from the Company’s United States operations were $448.0 million, $470.5 million and $508.4 million for the years ended December 31, 2017, 2016 and 2015, respectively.

Sales by product are as follows:



In thousands	2017		2016		2015
Specialty Products & Electronics	$	1,350,727	$	1,374,580	$	1,733,881
Brake Products	749,959		588,081		627,552
Remanufacturing, Overhaul & Build	522,275		559,284		606,624
Transit Products	1,112,340		276,124		189,581
Other	146,455		133,119		150,360
Total sales	$	3,881,756	$	2,931,188	$	3,307,998