Annual report pursuant to Section 13 and 15(d)

Industry Segments

v3.19.3.a.u2
Industry Segments
 12 Months Ended
Dec. 31, 2019
Segment Reporting [Abstract]  
Industry Segments
Industry Segments
The Company's business is divided into two operating segments: Metals and Specialty Chemicals. The Company identifies such segments based on products and services, long-term financial performance and end markets targeted. The Metals Segment operates as three reporting units including Welded Pipe & Tube Operations, a unit that includes Bristol Metals, LLC ("BRISMET") and American Stainless Tubing, LLC ("ASTI"), Palmer of Texas Tanks, Inc. ("Palmer"), and Specialty Pipe & Tube, Inc. ("Specialty").Welded Pipe & Tube Operations manufactures pipe and tube from stainless steel, galvanized, ornamental stainless steel tubing, and other alloy pipe and tube. Palmer manufactures liquid storage solutions and separation equipment. Specialty is a master distributor of seamless carbon pipe and tube. The Metals Segment's markets include the oil and gas, chemical, petrochemical, pulp and paper, mining, power generation (including nuclear), water and waste water treatment, liquid natural gas ("LNG"), brewery, food processing, petroleum, pharmaceutical, automotive & commercial transportation, appliance, architectural, and other heavy industries. The Specialty Chemicals Segment operates as one reporting unit which includes Manufacturers Chemicals, LLC ("MC"), a wholly-owned subsidiary of Manufacturers Soap and Chemical Company ("MS&C"), and CRI Tolling, LLC ("CRI Tolling"). The Specialty Chemicals Segment produces specialty chemicals for the chemical, paper, metals, mining, agricultural, fiber, paint, textile, automotive, petroleum, cosmetics, mattress, furniture, janitorial and other industries. MC manufactures lubricants, surfactants, defoamers, reaction intermediaries and sulfated fats and oils. CRI Tolling provides chemical tolling manufacturing resources to global and regional chemical companies and contracts with other chemical companies to manufacture certain, pre-defined products.
The chief operating decision maker evaluates performance and determines resource allocations based on a number of factors, the primary measure being operating income (loss). The accounting policies of the segments are the same as those described in the summary of significant accounting policies.
Segment operating income is the segment's total revenue less operating expenses. Identifiable assets, all of which are located in the U.S., are those assets used in operations by each segment. Centralized data processing and accounting expenses are allocated to the two segments based upon estimates of their percentage of usage. Corporate assets consist principally of cash, certain investments and equipment.
Segment Information:
All values are for continuing operations only.
(in thousands)
2019
 
2018
 
2017
Net sales
 
 
 
 
 
Metals Segment
$
251,078

 
$
222,242

 
$
152,957

Specialty Chemicals Segment
54,090

 
58,599

 
48,191

 
$
305,168

 
$
280,841

 
$
201,148

Operating (loss) income
 

 
 

 
 

Metals Segment
$
3,692

 
$
27,544

 
$
5,424

Gain on sale-leaseback
—

 
240

 
240

   Total Metals Segment
3,692

 
27,784

 
5,664

Specialty Chemicals Segment
2,811

 
3,879

 
4,295

Gain on sale-leaseback
—

 
95

 
95

   Total Specialty Chemicals Segment
2,811

 
3,974

 
4,390

 
6,503

 
31,758

 
10,054

 
 
 
 
 
 
Unallocated corporate expenses
8,357

 
7,878

 
6,513

Earn-out adjustments
(747
)
 
1,431

 
689

Acquisition related costs
601

 
1,212

 
795

Operating (loss) income
(1,708
)
 
21,237

 
2,057

Interest expense
3,818

 
2,211

 
985

Change in fair value of interest rate swap
141

 
(20
)
 
(96
)
Other income, net
(1,904
)
 
2,573

 
(310
)
(Loss) income before income taxes
$
(3,763
)
 
$
16,473

 
$
1,478

 
 
 
 
 
 
Identifiable assets
 

 
 

 
 

Metals Segment
$
186,758

 
$
192,196

 
 
Specialty Chemicals Segment
25,428

 
28,175

 
 
Corporate
45,011

 
8,028

 
 
 
$
257,197

 
$
228,399

 
 
Depreciation and amortization
 

 
 

 
 

Metals Segment
$
9,439

 
$
7,198

 
$
6,281

Specialty Chemicals Segment
1,461

 
1,428

 
1,302

Corporate
164

 
149

 
155

 
$
11,064

 
$
8,775

 
$
7,738

Capital expenditures
 

 
 

 
 

Metals Segment
$
2,812

 
$
5,969

 
$
3,406

Specialty Chemicals Segment
1,157

 
1,298

 
1,650

Corporate
568

 
88

 
223

 
$
4,537

 
$
7,355

 
$
5,279

Sales by product group
 
 
 
 
 
Specialty chemicals
$
54,090

 
$
58,599

 
$
48,191

Stainless steel pipe and tube
167,907

 
146,237

 
100,254

Heavy wall seamless carbon steel pipe and tube
30,607

 
32,474

 
25,103

Fiberglass and steel liquid storage tanks and separation equipment
28,722

 
31,654

 
27,600

Galvanized pipe and tube
23,842

 
11,877

 
—

 
$
305,168

 
$
280,841

 
$
201,148

Geographic sales
 

 
 

 
 

United States
$
297,808

 
$
273,244

 
$
196,172

Elsewhere
7,360

 
7,597

 
4,976

 
$
305,168

 
$
280,841

 
$
201,148