SEGMENT REPORTING

The Company has three operating segments, which are also its reportable segments: Infrastructure Solutions; Corrosion Protection; and Energy Services. The Company’s operating segments correspond to its management organizational structure. Each operating segment has a president who reports to the Company’s chief executive officer, who is also the chief operating decision manager (“CODM”). The operating results and financial information reported by each of the segments are evaluated separately, regularly reviewed and used by the CODM to evaluate segment performance, allocate resources and determine management incentive compensation.

The following disaggregated financial results have been prepared using a management approach that is consistent with the basis and manner with which management internally disaggregates financial information for the purpose of making internal operating decisions. The Company evaluates performance based on stand-alone operating income (loss), which includes acquisition-related expenses, restructuring charges and an allocation of corporate-related expenses.

Financial information by segment was as follows (in thousands):



	Quarters Ended June 30,						Six Months Ended June 30,
	2017			2016 ⁽¹⁾			2017 ⁽²⁾			2016 ⁽³⁾
Revenues:
Infrastructure Solutions	$	148,311		$	150,199		$	277,179		$	275,961
Corrosion Protection	127,715			94,410			251,105			186,856
Energy Services	78,447			53,077			151,364			128,777
Total revenues	$	354,473		$	297,686		$	679,648		$	591,594

Gross profit:
Infrastructure Solutions	$	34,364		$	39,175		$	65,615		$	68,919
Corrosion Protection	35,636			17,103			63,599			34,302
Energy Services	9,768			4,912			17,966			12,383
Total gross profit	$	79,768		$	61,190		$	147,180		$	115,604

Operating income (loss):
Infrastructure Solutions ⁽⁴⁾	$	8,391		$	13,067		$	14,001		$	18,875
Corrosion Protection ⁽⁵⁾	11,239			(2,469		)	18,451			(8,139		)
Energy Services ⁽⁶⁾	2,029			(2,453		)	3,340			(6,730		)
Total operating income	21,659			8,145			35,792			4,006
Other income (expense):
Interest expense	(4,005		)	(3,641		)	(8,052		)	(7,256		)
Interest income	35			128			84			160
Other ⁽⁷⁾	(408		)	(498		)	(795		)	(1,471		)
Total other expense	(4,378		)	(4,011		)	(8,763		)	(8,567		)
Income (loss) before taxes on income	$	17,281		$	4,134		$	27,029		$	(4,561	)

_______________________


⁽¹⁾	Results include: (i) $3.8 million of 2016 Restructuring charges (see Note 3); (ii) $0.7 million of costs incurred related to the acquisition of Underground Solutions, Fyfe Europe, LMJ and other acquisition targets; and (iii) inventory step up expense of $2.4 million recognized as part of the accounting for business combinations (see Note 1).


⁽²⁾	Results include $0.5 million of costs incurred related to the acquisitions of Environmental Techniques and other acquisition targets.


⁽³⁾	Results include: (i) $13.3 million of 2016 Restructuring charges (see Note 3); (ii) $1.7 million of costs incurred related to the acquisition of Underground Solutions and other acquisition targets; and (iii) inventory step up expense of $3.6 million recognized as part of the accounting for business combinations (see Note 1).


⁽⁴⁾	Operating income in the second quarter of 2016 includes: (i) $1.0 million of 2016 Restructuring charges (see Note 3); (ii) $0.7 million of costs incurred related to the acquisitions of Underground Solutions, Fyfe Europe, LMJ and other acquisition targets; and (iii) inventory step up expense of $2.4 million recognized as part of the accounting for business combinations (see Note 1).

Operating income in the six months ended June 30, 2017 includes $0.5 million of costs incurred related to the acquisition of Environmental Techniques and other acquisition targets. Operating income in the six months ended June 30, 2016 includes: (i) $3.1 million of 2016 Restructuring charges (see Note 3); (ii) $1.7 million of costs incurred related to the acquisitions of Underground Solutions, Fyfe Europe, LMJ and other acquisition targets; and (iii) inventory step up expense of $3.6 million recognized as part of the accounting for business combinations (see Note 1).


⁽⁵⁾	Operating loss in the quarter and six months ended June 30, 2016 includes $1.0 million and $3.7 million of 2016 Restructuring charges, respectively (see Note 3).


⁽⁶⁾	Operating loss in the quarter and six months ended June 30, 2016 includes $1.6 million and $6.4 million of 2016 Restructuring charges, respectively (see Note 3).


⁽⁷⁾	Other expenses for the second quarter and six months ended June 30, 2016 includes $0.3 million of 2016 Restructuring charges in both periods (see Note 3).

The following table summarizes revenues, gross profit and operating income by geographic region (in thousands):



	Quarters Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Revenues ⁽¹⁾:
United States	$	278,507		$	227,784		$	536,231		$	451,353
Canada	29,287			27,333			56,114			54,952
Europe	18,144			16,101			34,289			29,922
Other foreign	28,535			26,468			53,014			55,367
Total revenues	$	354,473		$	297,686		$	679,648		$	591,594

Gross profit:
United States	$	66,703		$	47,791		$	122,734		$	87,652
Canada	6,090			5,856			10,604			11,271
Europe	3,266			3,309			6,425			6,099
Other foreign	3,709			4,234			7,417			10,582
Total gross profit	$	79,768		$	61,190		$	147,180		$	115,604

Operating income (loss):
United States	$	19,614		$	5,145		$	32,131		$	145
Canada	2,478			3,147			3,938			4,798
Europe	(220		)	616			188			756
Other foreign	(213		)	(763		)	(465		)	(1,693		)
Total operating income	$	21,659		$	8,145		$	35,792		$	4,006

__________________________


⁽¹⁾	Revenues are attributed to the country of origin for the Company’s legal entities. For a significant majority of its legal entities, the country of origin relates to the country or geographic area that it services.