Annual report pursuant to Section 13 and 15(d)

Segment Information

v3.10.0.1
Segment Information
 12 Months Ended
Dec. 31, 2018
Segment Reporting [Abstract]  
Segment Data
Segment Information

Brunswick is a manufacturer and marketer of leading consumer brands and has three reportable segments: Marine Engine, Boat and Fitness. The Company’s segments are defined by management’s reporting structure and operating activities.

The Marine Engine segment manufactures and markets a full range of outboard engines, sterndrive engines, inboard engines and marine parts and accessories, which are principally sold directly to boat builders, including Brunswick's Boat segment, or through marine retail dealers and distributors worldwide. The Company's engine manufacturing plants are located mainly in the United States, China and Japan, with sales mainly to markets in the Americas, Europe and Asia-Pacific.

The Boat segment designs, manufactures and markets the following types of boats: fiberglass pleasure, sport cruiser, sport fishing and center-console, offshore fishing, aluminum and fiberglass fishing, pontoon, utility, deck, inflatable, and heavy-gauge aluminum. The Boat segment's products are manufactured mainly in the United States, Europe and Mexico and sold through a global network of dealer and distributor locations, primarily in North America and Europe.

The Fitness segment designs, manufactures and markets a full line of commercial-grade fitness equipment (including treadmills, total body cross-trainers, stair climbers, and stationary exercise bicycles and strength-training equipment) under the Life Fitness, Hammer Strength, Cybex, ICG, and SCIFIT brands. The Fitness segment also includes our active recreation product categories including billiards, table tennis and air hockey tables, as well as game room furniture and related accessories under the Brunswick and Contender brands. The segment's products are manufactured mainly in the United States and Hungary or are sourced from international suppliers. Fitness equipment is sold mainly in the Americas, Europe and Asia to health clubs, corporate, university, hospitality, military and government facilities, and to consumers through selected mass merchants, specialty retail dealers and through the Company's website. Consumer active recreation equipment is predominantly sold in the United States and distributed primarily through dealers.

The Company evaluates performance based on business segment operating earnings. Segment operating earnings do not include the expenses of corporate administration, pension costs, pension settlement charges, impairments or gains on the sale of equity investments, earnings from unconsolidated equity affiliates, other expenses and income of a non-operating nature, transaction financing charges, interest expense and income or provisions or benefits for income taxes.

Corporate/Other results include items such as corporate staff and administrative costs, investments in technology solutions, business development and other growth-related expenses, including IT enhancements. Corporate/Other total assets consist of mainly cash, cash equivalents and investments in marketable securities, restricted cash, income tax balances and investments in unconsolidated affiliates. Marine eliminations adjust for sales between the Marine Engine and Boat segments, primarily for the sale of engines and parts and accessories to various boat brands, which are consummated at established arm’s length transfer prices as the intersegment pricing for these engines and parts and accessories are based upon and consistent with selling prices to third party customers.

Information about the operations of Brunswick's reportable segments is set forth below:

Operating Segments
 
Net Sales
 
Operating Earnings (Loss)
 
Total Assets
(in millions)
2018
 
2017
 
2016
 
2018
 
2017
 
2016
 
2018
 
2017
Marine Engine
$
2,993.6

 
$
2,631.8

 
$
2,441.1

 
$
454.4

 
$
411.3

 
$
378.4

 
$
2,380.9

 
$
1,205.0

Boat
1,471.3

 
1,490.6

 
1,369.9

 
(12.5
)
 
5.3

 
60.8

 
423.2

 
411.6

Marine eliminations
(344.0
)
 
(320.2
)
 
(302.9
)
 
—

 
—

 
—

 
—

 
—

Total Marine
4,120.9

 
3,802.2

 
3,508.1

 
441.9

 
416.6

 
439.2

 
2,804.1

 
1,616.6

Fitness
1,038.3

 
1,033.7

 
980.4

 
22.4

 
64.1

 
117.3

 
972.7

 
1,012.8

Corporate/Other
—

 
—

 
—

 
(97.3
)
 
(82.4
)
 
(77.0
)
 
508.9

 
728.8

Total
$
5,159.2

 
$
4,835.9

 
$
4,488.5

 
$
367.0

 
$
398.3

 
$
479.5

 
$
4,285.7

 
$
3,358.2

    
 
Depreciation
 
Amortization
(in millions)
2018
 
2017
 
2016
 
2018
 
2017
 
2016
Marine Engine
$
69.3

 
$
48.8

 
$
48.4

 
$
23.0

 
$
1.7

 
$
1.8

Boat
26.7

 
31.8

 
29.3

 
1.0

 
1.0

 
0.8

Fitness
20.0

 
18.0

 
15.9

 
5.7

 
5.7

 
4.2

Corporate/Other
3.9

 
3.8

 
3.5

 
—

 
—

 
—

Total
$
119.9

 
$
102.4

 
$
97.1

 
$
29.7

 
$
8.4

 
$
6.8



 
Capital Expenditures
 
Research & Development Expense
(in millions)
2018
 
2017
 
2016
 
2018
 
2017
 
2016
Marine Engine
$
126.3

 
$
111.1

 
$
112.4

 
$
98.5

 
$
90.5

 
$
85.6

Boat
48.5

 
55.4

 
44.5

 
22.9

 
21.1

 
20.2

Fitness
13.2

 
24.3

 
35.7

 
27.4

 
34.8

 
33.4

Corporate/Other
5.4

 
12.4

 
1.3

 
—

 
—

 
—

Total
$
193.4

 
$
203.2

 
$
193.9

 
$
148.8

 
$
146.4

 
$
139.2



Geographic Segments
 
Net Sales
 
Net property
(in millions)
2018
 
2017
 
2016
 
2018
 
2017
United States
$
3,451.9

 
$
3,231.8

 
$
3,031.5

 
$
713.3

 
$
615.0

International
1,707.3

 
1,604.1

 
1,457.0

 
75.5

 
75.8

Corporate/Other
—

 
—

 
—

 
16.5

 
15.2

Total
$
5,159.2

 
$
4,835.9

 
$
4,488.5

 
$
805.3

 
$
706.0