Quarterly report pursuant to Section 13 or 15(d)

SEGMENT DISCLOSURES

v3.5.0.2
SEGMENT DISCLOSURES
 9 Months Ended
Sep. 30, 2016
Segment Reporting [Abstract]  
SEGMENT DISCLOSURES
SEGMENT DISCLOSURES

In connection with the LEEVAC transaction (See Note 2), management restructured the operation of our business units into three divisions which we believe meet the criteria of reportable segments under GAAP. These segments consist of Fabrication, Shipyards and Services.

Fabrication - Our Fabrication division primarily fabricates structures such as offshore drilling and production platforms and other steel structures for customers in the oil and gas industries including jackets and deck sections of fixed production platforms along with pressure vessels. Our Fabrication segment also fabricates structures for alternative energy customers (such as the five jackets and piles we constructed for a shallow water wind turbine project off the coast of Rhode Island during 2015) as well as LNG facilities. We perform these activities out of our fabrication yards in Houma, Louisiana and Ingleside, Texas.

Shipyards - Our Shipyards division primarily fabricates and repairs marine vessels including offshore supply vessels, anchor handling vessels, lift boats, tugboats, and towboats. Our Shipyards division also constructs and owns dry docks to lift marine vessels out of the water in order to make repairs or modifications. Our marine repair activities include steel repair, blasting and painting services, electrical systems repair, machinery and piping system repairs, and propeller, shaft and rudder reconditioning. Our Shipyards division also performs conversion projects that consist of lengthening or modifying the use of existing vessels to enhance their capacity or functionality. We perform these activities out of our facilities in Houma, Jennings and Lake Charles, Louisiana.

Services - Our Services division primarily provides interconnect piping services on offshore platforms and inshore structures. Interconnect piping services involve sending employee crews to offshore platforms in the Gulf of Mexico to perform welding and other activities required to connect production equipment, service modules and other equipment on a platform. We also contract with oil and gas companies that have platforms and other structures located in the inland lakes and bays throughout the Southeast for various on-site construction and maintenance activities. In addition, our Services division can fabricate packaged skid units and provide various municipal and drainage projects, such as pump stations, levee reinforcement, bulkheads and other projects for state and local governments.

We generally evaluate the performance of, and allocate resources to, our segments based upon gross profit (loss) and operating income (loss). Segment assets are comprised of all assets attributable to each segment. Corporate administrative costs and overhead are generally allocated to our segments except for those costs that are not directly related to the operations of our divisions. Intersegment revenues are priced at the estimated fair value of work performed. Summarized financial information concerning our segments as of and for the three and nine months ended September 30, 2016 and 2015 is as follows (in thousands):
 
Three Months Ended September 30, 2016
 
Fabrication
Shipyards (1), (2)
Services
Corp. & Eliminations
Consolidated
Revenue
$
22,311

$
23,060

$
20,928

$
(915
)
$
65,384

Gross profit
532

1,877

2,850

—

5,259

Operating income (loss)
(949
)
(188
)
1,310

—

173

 
 
 
 
 
 
Total assets
285,320

75,779

100,781

(124,668
)
337,212

Depreciation expense
4,637

1,183

443

123

6,386

CAPEX
1,228

318

565

14

2,125

 
 
 
 
 
 
 
Three Months Ended September 30, 2015
 
Fabrication
Shipyards (1)
Services
Corp. & Eliminations
Consolidated
Revenue
$
32,133

$
12,936

$
23,487

$
(1,025
)
$
67,531

Gross profit (loss)
(14,009
)
1,937

4,235

—

(7,837
)
Operating income (loss)
(22,747
)
1,545

3,241

(274
)
(18,235
)
 
 
 
 
 
 
Total assets
363,710

54,726

90,567

(171,967
)
337,036

Depreciation expense
5,495

480

432

127

6,534

CAPEX
1,054

662

382

1

2,099

 
 
 
 
 
 

 
Nine Months Ended September 30, 2016
 
Fabrication
Shipyards (1), (2)
Services
Corp. & Eliminations
Consolidated
Revenue
$
70,436

$
86,553

$
76,179

$
(2,304
)
$
230,864

Gross profit
4,418

9,595

11,012

—

25,025

Operating income (loss)
(61
)
3,720

6,893

(160
)
10,392

 
 
 
 
 
 
Total assets
285,320

75,779

100,781

(124,668
)
337,212

Depreciation expense
14,081

3,507

1,342

332

19,262

CAPEX
2,539

534

1,612

730

5,415

 
 
 
 
 
 
 
Nine Months Ended September 30, 2015
 
Fabrication
Shipyards (1)
Services
Corp. & Eliminations
Consolidated
Revenue
$
137,431

$
47,177

$
70,987

$
(4,493
)
$
251,102

Gross profit (loss)
(14,055
)
6,022

10,449

—

2,416

Operating income (loss)
(27,681
)
4,779

7,441

(540
)
(16,001
)
 
 
 
 
 
 
Total assets
363,710

54,726

90,567

(171,967
)
337,036

Depreciation expense
16,554

1,438

1,297

385

19,674

CAPEX
2,737

998

1,243

74

5,052

 
 
 
 
 
 
____________
(1)
Included in our results of operations for our Shipyards segment were revenue and net income (loss) of $16.8 million and $(471,000), for the three months ended September 30, 2016, and $55.9 million and $280,000 for the nine months ended September 30, 2016, respectively, attributable to the assets and operations acquired in the LEEVAC transaction. No amounts were included in the comparable 2015 periods as the LEEVAC transaction was effective January 1, 2016. See also Note 2.
(2)
Revenue for the three and nine months ended September 30, 2016 includes $1.5 million and $4.1 million of non-cash amortization of deferred revenue, respectively, related to the values assigned to contracts acquired in the LEEVAC transaction.