Quarterly report pursuant to Section 13 or 15(d)

Segment Information

v2.4.0.8
Segment Information
6 Months Ended
Jun. 30, 2013
Segment Reporting [Abstract]  
Segment Information
10. SEGMENT INFORMATION:

Quanta presents its operations under three reportable segments: (1) Electric Power Infrastructure Services, (2) Natural Gas and Pipeline Infrastructure Services and (3) Fiber Optic Licensing and Other. This structure is generally based on the broad end-user markets for Quanta’s services. See Note 1 for additional information regarding Quanta’s reportable segments.

Quanta’s segment results are derived from the types of services provided across its operating units in each of the end user markets described above. Quanta’s entrepreneurial business model allows each of its operating units to serve the same or similar customers and to provide a range of services across end user markets. Quanta’s operating units are organized into one of three internal divisions, namely, the electric power division, natural gas and pipeline division and fiber optic licensing division. These internal divisions are closely aligned with the reportable segments described above based on their operating units’ predominant type of work.

Reportable segment information, including revenues and operating income by type of work, is gathered from each operating unit for the purpose of evaluating segment performance in support of Quanta’s market strategies. These classifications of Quanta’s operating unit revenues by type of work for segment reporting purposes can at times require judgment on the part of management. Quanta’s operating units may perform joint infrastructure service projects for customers in multiple industries, deliver multiple types of network services under a single customer contract or provide service across industries, for example, joint trenching projects to install distribution lines for electric power and natural gas customers. Quanta’s integrated operations and common administrative support at each of its operating units require that certain allocations, including allocations of shared and indirect costs, such as facility costs, indirect operating expenses, including depreciation, and general and administrative costs, be made to determine operating segment profitability. Corporate costs, such as payroll and benefits, employee travel expenses, facility costs, professional fees, acquisition costs and amortization related to certain intangible assets are not allocated.

Summarized financial information for Quanta’s reportable segments is presented in the following tables (in thousands):

 

    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2013     2012     2013     2012  

Revenues:

       

Electric Power

  $ 1,046,379      $ 1,006,073      $ 2,227,362      $ 1,938,286   

Natural Gas and Pipeline

    385,942        337,595        744,874        694,562   

Fiber Optic Licensing and Other

    42,056        42,494        87,851        82,078   
 

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

  $ 1,474,377      $ 1,386,162      $ 3,060,087      $ 2,714,926   
 

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss):

       

Electric Power

  $ 120,809      $ 110,735      $ 253,359      $ 224,949   

Natural Gas and Pipeline

    27,644        15,055        38,001        4,520   

Fiber Optic Licensing and Other

    14,301        15,423        31,184        29,963   

Corporate and non-allocated costs

    (45,580     (42,868     (86,079     (82,296
 

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

  $ 117,174      $ 98,345      $ 236,465      $ 177,136   
 

 

 

   

 

 

   

 

 

   

 

 

 

Depreciation:

       

Electric Power

  $ 15,776      $ 13,342      $ 30,699      $ 26,710   

Natural Gas and Pipeline

    11,335        10,634        22,600        20,990   

Fiber Optic Licensing and Other

    4,230        3,727        8,281        7,402   

Corporate and non-allocated costs

    1,699        1,673        3,340        3,300   
 

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated

  $ 33,040      $ 29,376      $ 64,920      $ 58,402   
 

 

 

   

 

 

   

 

 

   

 

 

 

 

Separate measures of Quanta’s assets and cash flows by reportable segment, including capital expenditures, are not produced or utilized by management to evaluate segment performance. Quanta’s fixed assets, including operating machinery, equipment and vehicles, as well as office equipment, buildings and leasehold improvements, which are held at the operating unit level, are used on an interchangeable basis across its reportable segments. As such, for reporting purposes, total depreciation expense is allocated each quarter among Quanta’s reportable segments based on the ratio of each reportable segment’s revenue contribution to consolidated revenues.

Foreign Operations

During the three months ended June 30, 2013 and 2012, Quanta derived $208.4 million and $155.8 million of its revenues from foreign operations. During the six months ended June 30, 2013 and 2012, Quanta derived $505.8 million and $405.6 million of its revenues from foreign operations. Of Quanta’s foreign revenues, approximately 96% and 95% was earned in Canada for the three months ended June 30, 2013 and 2012 and approximately 97% and 96% was earned in Canada for the six months ended June 30, 2013 and 2012. In addition, Quanta held property and equipment of $169.4 million and $151.9 million in foreign countries, primarily Canada, as of June 30, 2013 and December 31, 2012.